0001213900-21-004865.txt : 20210128 0001213900-21-004865.hdr.sgml : 20210128 20210128142426 ACCESSION NUMBER: 0001213900-21-004865 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 53 CONFORMED PERIOD OF REPORT: 20200331 FILED AS OF DATE: 20210128 DATE AS OF CHANGE: 20210128 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LegacyXChange, Inc. CENTRAL INDEX KEY: 0001423579 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 208628868 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-55608 FILM NUMBER: 21564185 BUSINESS ADDRESS: STREET 1: 301 YAMATO ROAD CITY: BOCA RATON STATE: FL ZIP: 33431 BUSINESS PHONE: 800-630-4190 MAIL ADDRESS: STREET 1: 301 YAMATO ROAD CITY: BOCA RATON STATE: FL ZIP: 33431 FORMER COMPANY: FORMER CONFORMED NAME: LegacyXChange, Inc DATE OF NAME CHANGE: 20150803 FORMER COMPANY: FORMER CONFORMED NAME: True 2 Beauty Inc. DATE OF NAME CHANGE: 20100608 FORMER COMPANY: FORMER CONFORMED NAME: Burrow Mining Inc. DATE OF NAME CHANGE: 20080111 10-K 1 f10k2020_legacyxchange.htm ANNUAL REPORT
 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended: March 31, 2020

 

or

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _________ to _________

 

COMMISSION FILE NO. 333-201811

 

LegacyXchange, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada   46-1515670
(State or other jurisdiction of incorporation)   (I.R.S. Employer Identification Number)
     
301 Yamato Rd., Suite 1240, Boca Raton, FL 33431   (800) 630-4190
(Address of principal executive offices and zip code)   (Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class   Trading Symbol   Name of each Exchange on which registered
N/A   N/A   N/A

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.001 per share

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐     No ☒

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐     No ☒

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐     No ☒

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐     No ☒

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☒     No ☐

 

The aggregate market value of the voting and non-voting common stock held by non-affiliates of the registrant as of September 30, 2019, the last business day of the registrant’s last completed second quarter, based upon the closing price of the common stock of $0.0019 on such date is $90,384.

 

As of January 25, 2021, there were 62,570,659 shares of the issuer’s common stock, par value $0.001, issued and outstanding.

 

 

 

 

 

 

TABLE OF CONTENTS

 

      Page
    PART I  
       
Item 1.   Business 1
Item 1A.   Risk Factors 1
Item 1B.   Unresolved Staff Comments 1
Item 2.   Properties 1
Item 3.   Legal Proceedings 1
Item 4.   Mine Safety Disclosures 1
       
    PART II  
       
Item 5.   Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 2
Item 6.   Selected Financial Data 2
Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations 3
Item 7A.   Quantitative and Qualitative Disclosures About Market Risk 7
Item 8.   Financial Statements and Supplementary Data 8
Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 8
Item 9A.   Controls and Procedures 8
Item 9B.   Other Information 9
       
    PART III  
       
Item 10.   Directors, Executive Officers and Corporate Governance 10
Item 11.   Executive Compensation 11
Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 13
Item 13.   Certain Relationships and Related Transactions, and Director Independence 14
Item 14.   Principal Accounting Fees and Services 15
       
    PART IV  
       
Item 15.   Exhibits and Financial Statement Schedules 16
Item 16.   Form 10-K Summary 16
    Signatures 17

 

i

 

 

PART I

 

Item 1. Business

 

Business Development

 

LegacyXchange, Inc., formerly known as True 2 Beauty, Inc. (the “Company”) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus.

 

On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (“True2Bid”) which was incorporated in the state of Nevada. This subsidiary’s name was changed to LegacyXchange, Inc. (“LegacyXchange”) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction. The Company is currently inactive and management is seeking other business opportunities.

 

The Company’s articles authorize the Company to issue 190,000,000 shares of common stock and 10,000,000 shares of preferred stock, both at a par value of $0.001 per share.

 

Item 1A. Risk Factors.

 

N/A

 

Item 1B. Unresolved Staff Comments.

 

N/A

 

Item 2. Properties.

 

The Company has no property as of the date of this report.

 

Item 3. Legal Proceedings.

 

None.

 

Item 4. Submission of matters to a vote of Security holders.

 

None.

 

1

 

 

PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 

Market Information

 

Our shares of common stock are quoted on OTC Pink operated by the OTC Markets Group, under the symbol “LEGX”. The following table sets forth the range of reported high and low closing bid quotations for our common stock for the fiscal quarters indicated. These quotations reflect inter-dealer prices, without retail markup, markdown or commission, and may not represent actual transactions. Consequently, the information provided below may not be indicative of our common stock price under different conditions.

 

   High   Low 
Fiscal Year 2020          
First Quarter ended June 30, 2019  $0.03   $0.001 
Second Quarter ended September 30, 2019  $0.03   $0.001 
Third Quarter ended December 31, 2019  $0.05   $0.001 
Fourth Quarter Ended March 31, 2020  $0.04   $0.002 
           
Fiscal Year 2019          
First Quarter ended June 30, 2018  $0.02   $0.001 
Second Quarter ended September 30, 2018  $0.02   $0.002 
Third Quarter ended December 31, 2018  $0.02   $0.001 
Fourth Quarter Ended March 31, 2019  $0.02   $0.001 

 

Holders of Common Stock

 

As of January 22, 2021, there were approximately 80 record holders of our common stock. The number of record holders does not include beneficial owners of common stock whose shares are held in the names of banks, brokers, nominees or other fiduciaries.

 

Cash Dividends

 

We have not paid any cash dividends on our common stock and have no intention of paying any dividends on the shares of our common stock. Our current policy is to retain earnings, if any, for use in our operations and in the development of our business. Our future dividend policy will be determined from time to time by our board of directors.

 

Recent Sales of Unregistered Securities

 

Except for provided below, all unregistered sales of our securities during the quarter ended March 31, 2020, were previously disclosed in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.

 

During the three months ended March 31, 2020, there were no unregistered sales of our securities.

  

The shares of common stock, notes and warrants referenced herein were issued in reliance upon the exemption from securities registration afforded by the provisions of Section 4(a)(2) of the Securities Act of 1933, as amended, (“Securities Act”).

  

Securities Authorized for Issuance under Equity Compensation Plans

 

None.

 

Repurchases of Equity Securities by our Company and Affiliated Purchasers

 

None.

 

Item 6. Selected Financial Data

 

Not applicable.

 

2

 

 

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Overview

 

LegacyXchange, Inc., formerly known as True 2 Beauty, Inc. (the “Company”) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus.

 

On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (“True2Bid”) which was incorporated in the state of Nevada. This subsidiary’s name was changed to LegacyXchange, Inc. (“LegacyXchange”) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction. The Company has ceased all operations related to LegacyXchange. Currently, management is seeking other business opportunities.

 

The Company’s articles authorize the Company to issue 190,000,000 shares of common stock and 10,000,000 shares of preferred stock, both at a par value of $0.001 per share.

 

The following table summarizes the results of operations for the years ended March 31, 2020 and 2019 and is based primarily on the comparative audited financial statements, footnotes and related information for the periods identified and should be read in conjunction with the financial statements and the notes to those statements that are included elsewhere in this annual report.

 

   For the Years Ended March 31, 
   2020   2019 
Loss from operations  $(88,287)  $(63,425)
Other expense, net   (64,049)   (79,285)
Net loss  $(152,336)  $(142,710)

 

Revenue:

 

We did not generate any revenues from operations during the years ended March 31, 2020 and 2019.

 

Operating expenses:

 

For the years ended March 31, 2020 and 2019, operating expenses amounted to $88,287 and $63,425, respectively, an increase of $24,862 or 39%. For the years ended March 31, 2020 and 2019, operating expenses consisted of the following:

 

   For the Years Ended March 31, 
   2020   2019 
Executive compensation  $58,964   $60,000 
Professional and consulting fees   28,400    2,550 
Other selling, general and administrative   923    875 
Total  $88,287   $63,425 

 

  Executive compensation:

 

For the years ended March 31, 2020 and 2019, executive compensation amounted to $58,964 and $60,000, respectively, a decrease of $1,036 or 1.7%.

 

  Professional and consulting fees:

 

For the years ended March 31, 2020 and 2019, professional and consulting fees amounted to $28,400 and $2,550 respectively, an increase of $25,850 or 1,014%. The increase was primarily attributable to an increase in accounting fee of $20,000 and increase in legal fee of $7,500 in 2020.

 

3

 

 

  Other selling, general and administrative:

 

For the years ended March 31, 2020 and 2019, other selling, general and administrative expenses amounted to $923 and $875 respectively, an increase of $48 or 5%.

  

Loss from operations:

 

For the years ended March 31, 2020 and 2019, loss from operations amounted to $88,287 and $63,425, respectively, an increase of $24,862 or 39%. The increase was a result of the changes in operating expenses as discussed above.

 

Other income (expense):

 

Other income (expense) includes interest expense, gain from the change in fair value of derivative liabilities and gain from extinguishment of account payable.

 

For the year ended March 31, 2020, total other expense, net, amounted to $64,049 as compared to $79,285 for the year ended March 31, 2019, a decrease of $15,236 or 19%. The decrease in other expense, net, was attributable to a decrease in interest expense of $20,934, or 25% offset by a decrease in gain from change in fair value of derivative liabilities of $3,148 or 100% and a decrease from gain from extinguishment of debt of $2,550 or 100%.

 

Net loss:

 

For the year ended March 31, 2020, net loss amounted to $152,336, or per common share loss of $(0.00) (basic and diluted) as compared to $142,710 net loss, or per common share loss of $(0.00) (basic and diluted) for the year ended March 31, 2019, an increase of $9,626, or 7%. The increase was a result of the changes in operating expenses and other income (expense) as discussed above.

 

Liquidity and Capital Resources

 

Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. We had a working capital deficit of $1,422,848 and $21,152 of cash as of March 31, 2020 and working capital deficit of $1,317,838 and $0 of cash as of March 31, 2019.

 

   March 31,
2020
   March 31,
2019
   Change   Percentage
Change
 
Working capital deficit:                    
Total current assets  $21,152   $   $21,152    100%
Total current liabilities   (1,444,000)   (1,317,838)   (126,162)   10%
Working capital deficit:  $(1,422,848)  $(1,317,838)  $(105,010)   8%

 

The increase in working capital deficit was primarily attributable to an increase in current assets of $21,152 offset by an increase in current liabilities of $126,162.

 

Cash Flow

 

A summary of cash flow activities is summarized as follows:

 

   For the Years Ended March 31, 
   2020   2019 
Cash used in operating activities  $(23,848)  $ 
Cash provided by financing activities   45,000     
Net increase in cash  $21,152   $ 

 

Net cash used in operating activities:

 

Net cash flow used in operating activities was $23,848 and $0 for the year ended March 31, 2020 and 2019, respectively.

 

  Net cash flow used in operating activities for the year ended March 31, 2020 primarily reflected our net loss of $152,336 adjusted for the changes in operating assets and liabilities primarily consisting of an increase in accounts payable of $5,475 and an increase in accrued liabilities of $123,013.

 

4

 

 

  Net cash flow used in operating activities for the year ended March 31, 2019 primarily reflected our net loss of $142,710 adjusted for the add-back on non-cash items such amortization of debt discount of $21,649, gain from change in fair value of derivative liabilities of $3,148, gain from extinguishment of debt of $2,550 and the changes in operating assets and liabilities primarily consisting of an increase in accounts payable of $3,425 and an increase in accrued liabilities of $123,334.

 

Cash provided by financing activities:

 

Net cash provided by financing activities was $45,000 for the year ended March 31, 2020 as compared to $0 for the year ended March 31, 2019, an increase of $45,000 or 100%.

 

  Net cash provided by financing activities for the year ended March 31, 2020 consisted of $45,000 of net proceeds from investor loans.

 

Cash Requirements

 

Our management does not believe that our current capital resources will be adequate to continue operating our company and maintaining our business strategy for more than 12 months from the date of this report. Accordingly, we will have to raise additional capital in the near future to meet our working capital requirements. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to scale down or perhaps even cease the operation of our business.

 

Going Concern

 

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company’s loans payable in the aggregate amount of $143,924 and $480,470 convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report.

  

Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.

 

Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Future Financings

 

We will require additional financing to fund our planned operations. We currently do not have committed sources of additional financing and may not be able to obtain additional financing particularly, if the volatile conditions of the stock and financial markets persist.

 

There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to further delay or further scale down some or all of our activities or perhaps even cease the operations of the business.

 

Since inception we have funded our operations primarily through equity and debt financings and we expect that we will continue to fund our operations through the equity and debt financing. If we are able to raise additional financing by issuing equity securities, our existing stockholders’ ownership will be diluted. Obtaining commercial or other loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

 

There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on his, her, or its investment in our common stock. Further, we may continue to be unprofitable.

 

5

 

 

Critical Accounting Policies

 

We have identified the following policies as critical to our business and results of operations. Our reported results are impacted by the application of the following accounting policies, certain of which require management to make subjective or complex judgments. These judgments involve making estimates about the effect of matters that are inherently uncertain and may significantly impact quarterly or annual results of operations. For all of these policies, management cautions that future events rarely develop exactly as expected, and the best estimates routinely require adjustment. Specific risks associated with these critical accounting policies are described in the following paragraphs.

  

Use of Estimates

 

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in estimation of deferred tax valuation allowances and the valuation of derivative liabilities.

 

Fair Value of Financial Instruments and Fair Value Measurements

 

FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

 

The three levels of the fair value hierarchy are as follows:

 

  Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
   
  Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
   
  Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

 

The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments.

 

Derivative Liabilities

 

The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.

 

In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.

  

6

 

 

Revenue Recognition

 

In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31, 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.

 

Stock-Based Compensation

 

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

 

In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements.

 

Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company’s financial statements.

 

Recent Accounting Pronouncements

 

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

 

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

 

Not applicable.

 

7

 

 

Item 8. Financial Statements and Supplementary Data.

 

See Index to Financial Statements and Financial Statement Schedules of this annual report on Form 10-K.

 

Item 9. Changes and Disagreements with Accountants on Accounting and Financial Disclosures

 

None.

 

Item 9A. Controls and Procedures

 

Disclosure Controls and Procedures

 

We maintain “disclosure controls and procedures,” as that term is defined in Rule 13a-15(e), promulgated by the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer to allow timely decisions regarding required disclosure. Our management, with the participation of our principal executive officer and principal financial officer, evaluated our company’s disclosure controls and procedures as of the end of the period covered by this annual report on Form 10-K. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of March 31, 2020, our disclosure controls and procedures were not effective. The ineffectiveness of our disclosure controls and procedures was due to material weaknesses, which we identified, in our report on internal control over financial reporting.

 

Internal Control Over Financial Reporting

 

Management’s Annual Report on Internal Control over Financial Reporting

 

Our management, including our principal executive officer and principal financial officer, is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our internal control over financial reporting as of March 31, 2020. Our management’s evaluation of our internal control over financial reporting was based on the framework in Internal Control-Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that as of March 31, 2020, our internal control over financial reporting was not effective.

 

The ineffectiveness of our internal control over financial reporting was due to the following material weaknesses which we identified in our internal control over financial reporting:

 

  (1) the lack of multiples levels of management review on complex accounting and financial reporting issues, and business transactions,
     
  (2) a lack of adequate segregation of duties and necessary corporate accounting resources in our financial reporting process and accounting function as a result of our limited financial resources to support hiring of personnel and implementation of accounting systems, and

 

We expect to be materially dependent upon third parties to provide us with accounting consulting services related to accounting services for the foreseeable future. We believe this will be sufficient to remediate the material weaknesses related to our accounting discussed above. Until such time as we have a chief financial officer with the requisite expertise in U.S. GAAP, there are no assurances that the material weaknesses and significant deficiencies in our disclosure controls and procedures will not result in errors in our financial statements which could lead to a restatement of those financial statements.

 

A material weakness is a deficiency or a combination of control deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

 

8

 

 

Limitations on Effectiveness of Controls

 

Our principal executive officer and principal financial officer do not expect that our disclosure controls or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additional controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

 

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the company’s registered public accounting firm pursuant to SEC rules that permit us to provide only management’s report on internal control over financial reporting in this annual report on Form 10-K.

 

Changes in Internal Control over Financial Reporting

 

There was no change in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934) during the quarter ended March 31, 2020 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

Item 9B. Other Information

 

Not Applicable.

 

9

 

 

PART III

 

Item 10. Directors, Executive Officers and Corporate Governance

 

Board of Directors and Executive Officers

 

The following table sets forth the names, positions and ages of our directors and executive officers as of the date of this report.

 

Name   Age   Position
William Bollander   50   Chief Executive Officer/President/Director/Secretary/Treasurer

 

Biographical information concerning the executive officer and director listed above is set forth below. The information presented includes information each individual has given us about all positions they hold and their principal occupation and business experience for the past five years. In addition to the information presented below regarding each director’s specific experience, qualifications, attributes and skills that led our board to conclude that he should serve as a director, we also believe that all of our directors have a reputation for integrity, honesty and adherence to high ethical standards. Each has demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment of service to our company and our board of directors.

 

William Bollander. Mr. Bollander has served as our President/Chief Executive Officer/Chief Financial Officer/Chief Accountancy Officer/Director/Secretary/Treasurer since January 17, 2012. From November 2008 to March 2011, he was an independent financial consultant for vFinance, a registered securities broker dealer located in located in Boca Raton FL. From March 2011 to November 2011, William Bollander was our business consultant. William Bollander received a Bachelor’s Degree in Accounting & Information Systems from Queens College/City University of New York in February 1992.

 

Board of Directors

 

Directors are elected at our annual meeting of shareholders and serve for one year until the next annual meeting of shareholders or until their successors are elected and qualified. We reimburse all directors for their expenses in connection with their activities as our directors.

 

Family Relationships

 

No family relationships exist between any of our current or former directors or executive officers.

 

Involvement in Certain Legal Proceedings

 

There are no material proceedings to which any director or executive officer or any associate of any such director or officer is a party adverse to our company or has a material interest adverse to our company.

 

Section 16(a) Beneficial Ownership Reporting Compliance

 

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors, and persons who own more than 10% of our common stock, to file reports regarding ownership of, and transactions in, our securities with the Securities and Exchange Commission and to provide us with copies of those filings.

 

Code of Ethics

 

We have not yet adopted a formal, written Code of Business Conduct and Ethics.

  

Corporate Governance

 

Board Leadership Structure and Role in Risk Oversight

 

Although we have not adopted a formal policy on whether the Chairman and Chief Executive Officer positions should be separate or combined, we have determined that it is in our best interests and its shareholders to combine these roles. Due to the small size and our early development stage, we believe it is currently most effective to have the Chairman and Chief Executive Officer positions combined.

 

10

 

 

Our board of directors is primarily responsible for overseeing our risk management processes. The board of directors receives and reviews periodic reports from management, auditors, legal counsel, and others, as considered appropriate regarding our assessment of risks. The board of directors focuses on the most significant risks facing us and our general risk management strategy, and also ensures that risks undertaken by us are consistent with the board’s appetite for risk. While the board oversees our risk management, management is responsible for day-to-day risk management processes. We believe this division of responsibilities is the most effective approach for addressing the risks facing us and that our board leadership structure supports this approach.

 

We have had no meetings of our Board of Directors. Our Board of Directors have approved corporate actions by Board resolution.

 

We do not have any defined policy or procedure requirements for shareholders to submit recommendations or nominations for directors. We do not currently have any specific or minimum criteria for the election of nominees to our board of directors and we do not have any specific process or procedure for evaluating such nominees. Our board of directors assesses all candidates, whether submitted by management or shareholders, and makes recommendations for election or appointment.

 

A shareholder who wishes to communicate with our board of directors may do so by directing a written request to the address appearing on the first page of this annual report.

 

Terms of Office

 

Our directors are appointed for one-year terms to hold office until the next annual general meeting of the holders of our Common Stock or until removed from office in accordance with our by-laws. Our officers are appointed by our board of directors and hold office until removed by our Board of Directors or terminated pursuant to their employment agreements.

 

Committees of the Board of Directors

 

We presently do not have an audit committee, compensation committee, nominating committee, corporate governance committee or any other committee of our board of directors. Our entire Board of Directors meets to undertake the responsibilities that would otherwise be delegated to a committee of our board of directors.

 

Audit Committee and Audit Committee Financial Expert

 

We do not have a standing audit committee at the present time. Our board of directors has determined that we do not have a board member that qualifies as an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K.

 

We believe that our board of directors is capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. The board of directors of our Company does not believe that it is necessary to have an audit committee because we believe that the functions of an audit committee can be adequately performed by the board of directors. In addition, we believe that retaining an independent director who would qualify as an “audit committee financial expert” would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development.

  

Item 11. Executive Compensation

 

Summary Compensation

 

The following table sets forth information regarding executive compensation earned in or with respect to our fiscal year 2020 and 2019 by:

 

  each person who served as our CEO; and

 

  each person who served as our CFO; and

 

  each person who served as our President.

 

11

 

 

SUMMARY COMPENSATION TABLE

FOR OUR NAMED EXECUTIVE OFFICERS

 

Name and Position  Year   Compensation
($)
   Stock Awards
($)
   Option Awards
($)
   Non-Equity Incentive Plan Compensation
($)
   Nonqualified Deferred Compensation Earnings
($)
   All Other Compensation
($)
   Total
($)
 
William Bollander:
Chief Executive Officer,
  2020   60,000(1)                       60,000 
President and Director(1)  2019    60,000(1)                       60,000 

 

 

(1) William Bollander serves as our Chief Executive Officer, Chief Financial Officer, President and sole Director. Mr. Bollander has no employment agreement with the Company and his annual compensation was reduced from $120,000 to $60,000 effective July 2017. As of March 31, 2020, Mr. Bollander had $332,173 of his compensation accrued and payable of which $60,000 were for fiscal year 2020 and $272,173 are for prior fiscal years.

 

Compensation of Management

 

We have no contractual arrangements with any executives or directors.

 

Outstanding Equity Awards at 2020 Fiscal Year-End for Named Executive Officers

 

The following table sets forth certain information concerning the outstanding equity awards as of March 31, 2020, for each named executive officer.

 

   Option Awards       Stock Awards     
Name  Number of Securities Underlying Unexercised Options (#) Exercisable  Number of Securities Underlying Unexercised Options (#) Unexercisable   Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options   Option Exercise Price
($)
   Option Expiration Date   Number of Shares or Units of Stock that Have Not Vested   Market Value of Shares or Units of Stock that Have Not Vested   Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested   Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested 
William Bollander                         

 

Compensation of Directors

 

The following table sets forth certain information regarding the compensation paid to our directors during the fiscal years ended March 31, 2020 and 2019:

 

Name   Year   Fees
Earned
or Paid
in Cash
($)
    Stock
Awards
($)
    Option
Awards
Vested
($)
    Option
Awards
Unvested
($)
    Non-Equity
Incentive Plan
Compensation
($)
    Nonqualified
Deferred
Compensation
Earnings
($)
    All Other
Compensation
($)
    Total
($)
 
William   2020                                
Bollander(1)   2019                                

 

 

(1)

William Bollander is the sole member of the Board of Directors director of the Company and did not receive cash compensation for such position. 

 

There are no contractual arrangements with any member of the Board of Directors.

 

12

 

 

Long-Term Incentive Plans, Retirement or Similar Benefit Plans

 

There are currently no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers.

 

Our directors, executive officers and employees may receive common stock at the discretion of our board of directors.

 

Resignation, Retirement, Other Termination, or Change in Control Arrangements

 

We do not have arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The following table sets forth certain information regarding beneficial ownership of our common stock, as of January 25, 2021, by (i) each person known by us to be the beneficial owner of more than 5% of our outstanding common stock, (ii) each director and each of our Named Executive Officers and (iii) all executive officers and directors as a group.

 

The number of shares of common stock beneficially owned by each person is determined under the rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares as to which such person has sole or shared voting power or investment power and also any shares which the individual has the right to acquire within 60 days after the date hereof, through the exercise of any stock option, warrant or other right. Unless otherwise indicated, each person has sole investment and voting power (or shares such power with his or her spouse) with respect to the shares set forth in the following table. The inclusion herein of any shares deemed beneficially owned does not constitute an admission of beneficial ownership of those shares.

 

This table is based upon information derived from our stock records. Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, each of the shareholders named in this table has sole or shared voting and investment power with respect to the shares indicated as beneficially owned. Except as set forth above, applicable percentages are based upon 62,570,659 shares of common stock outstanding as of the date of this annual report.

 

Name and Address of Beneficial Owner  Common Stock Beneficial Ownership   Percent of Outstanding Shares (%) 
Five Percent Stockholders:          
William Bollander(1)   15,000,000    24.0%
Ascendant Partners LLC(2)   15,410,667    24.6%
Red Clover Capital LLC(3)   5,005,556    8.0%
           
Named Executive Officers and Directors:          
William Bollander(1)   15,000,000    24.0%

 

 

1. Represents the 15,000,000 shares of commons stock held by Mr. Bollander.

2. Ascendant Partners LLC (“Ascendant”) and Ascendant’s managing member Richard Galierio may be deemed to beneficially own shares of common stock beneficially owned by Ascendant, including shares issuable to Ascendant upon conversion of a series of convertible notes. The address of the principal business office of Ascendant is 112 Serpentine Dr, Morganville, NJ 07751. Voting and dispositive power with respect to the shares owned by Ascendant is exercised by Mr. Galierio. Ascendant disclaims beneficial ownership or control of any of the securities listed above as control may be deemed to be held by the other members of Ascendant. However, by reason of the provisions of Rule 13d-3 of the Exchange Act, as amended, Ascendant and Mr. Galierio may be deemed to beneficially own or control the shares owned by Ascendant. Includes an estimated of 13,610,667 shares of common stock issuable upon conversion of outstanding convertible note balance as of the date of this report.

3. Red Clover Capital LLC (“Red Clover”) and Red Clover’s managing member Roger Ralston may be deemed to beneficially shares of common stock beneficially owned by Red Clover, including shares issuable to Red Clover upon conversion of a series of convertible notes. The address of the principal business office of Red Clover is 40 Wall St., 62nd Floor, New York, NY 10005. Voting and dispositive power with respect to the shares owned by Red Clover is exercised by Mr. Ralston. Red Clover disclaims beneficial ownership or control of any of the securities listed above as control may be deemed to be held by the other members of Red Clover. However, by reason of the provisions of Rule 13d-3 of the Exchange Act, as amended, Red Clover and Mr. Ralston may be deemed to beneficially own or control the shares owned by Red Clover. Includes an estimated of 5,005,556 shares of common stock issuable upon conversion of outstanding convertible note balance as of the date of this report.

 

13

 

 

Item 13. Certain Relationships and Related Transaction, and Director Independence

 

Transactions with Related Persons

 

There were no transactions, or currently proposed transactions, in which we were or are to be a participant and the amount involved exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal years, and in which any of the following persons had or will have a direct or indirect material interest:

 

  (i) Any director or executive officer of our company;
     
  (ii) Any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our outstanding shares of common stock;
     
  (iii) Any member of the immediate family (including spouse, parents, children, siblings and in-laws) of any of the foregoing persons, and any person (other than a tenant or employee) sharing the household of any of the foregoing persons.

 

Director Independence

 

Because the Company’s Common Stock is not currently listed on a national securities exchange, the Company has used the definition of “independence” of the NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an “independent director” is a person other than an officer or employee of the company or any other individual having a relationship which, in the opinion of the company’s board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if:

 

  the director is, or at any time during the past three years was, an employee of the company;
     
  the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for board or board committee service);
     
  a family member of the director is, or at any time during the past three years was, an executive officer of the company;
     
  the director or a family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions);
     
  the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three years, any of the executive officers of the Company served on the compensation committee of such other entity; or
     
  the director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit.

 

Based on this review, we have no independent directors pursuant to the requirements of the NASDAQ Stock Market.

 

14

 

 

Item 14. Principal Accounting Fees and Services

 

The following table sets forth the fees billed to our company for the years ended March 31, 2020 and 2019 for professional services rendered by our independent registered public accounting firm, Salberg and Company, P.A.:

 

   Years Ended March 31, 
Fees  2020   2019 
Audit Fees  $3,800   $3,800 
Audit Related Fees        
Tax Fees        
All other fees        
Total  $3,800   $3,800 

 

Audit Fees

 

Audit fees were for professional services rendered for the audits of our annual financial statements and for review of our quarterly financial statements during the fiscal years ended March 31, 2020 and 2019.

 

Audit-Related Fees

 

This category consists of assurance and related services by the independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees”.

 

Tax Fees

 

As our independent registered public accountants did not provide any services to us for tax compliance, tax advice and tax planning during the fiscal years ended March 31, 2020 and 2019, no tax fees were billed or paid during those fiscal years.

 

All Other Fees

 

Our independent registered public accountants did not provide any products and services not disclosed in the table above during the 2020 and 2019 fiscal years. As a result, there were no other fees billed or paid during those fiscal years.

 

Pre-Approval Policies and Procedures

 

Our entire board of directors, which acts as our audit committee, pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by our board of directors before the respective services were rendered.

 

Our board of directors has considered the nature and amount of fees billed by our independent registered public accounting firm and believe that the provision of services for activities unrelated to the audit is compatible with maintaining their respective independence.

 

15

 

 

PART IV

 

ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES

 

(a) 1. Financial Statements
     
    The financial statements and Report of Independent Registered Public Accounting Firm are listed in the “Index to Financial Statements and Schedules” on page F-1 and included on pages F-2 through F-14.
     
  2. Financial Statement Schedules
     
    All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission (the “Commission”) are either not required under the related instructions, are not applicable (and therefore have been omitted), or the required disclosures are contained in the financial statements included herein.
     
  3. Exhibits (including those incorporated by reference).

 

Exhibit No.   Description
3.1   Articles of Incorporation*
     
3.5   Bylaws*
     
31.1   Certification pursuant to Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934, as amended, filed herewith (Chief Executive Officer and Chief Financial Officer) **
     
32.1   Certification furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer and Chief Financial Officer) **
     
101.INS   XBRL INSTANCE DOCUMENT
101.SCH   XBRL TAXONOMY EXTENSION SCHEMA
101.CAL   XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.DEF   XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.LAB   XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.PRE   XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

 

 

*Previously filed as exhibit to Form S-1 Registration Statement filed on March 20, 2015.
**Filed herein

 

ITEM 16. FORM 10-K SUMMARY

 

Not Applicable.

 

16

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  LegacyXchange, Inc.
Date: January 28, 2021    
  By: /s/ William Bollander
    William Bollander
    Chief Executive Officer, Chief Financial Officer and President (Principal Executive, Financial and Accounting Officer)

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Signature   Title   Date
         

/s/ William Bollander

  Chief Executive Officer, Chief Financial Officer, President and Director (Principal Executive, Financial and Accounting Officer) January 28, 2021
William Bollander        

 

17

 

 

LEGACYXCHANGE, INC

 

INDEX TO FINANCIAL STATEMENTS

March 31, 2020 and 2019

 

CONTENTS

 

Report of Independent Registered Public Accounting Firm F-2
   
Financial Statements:  
   
Balance Sheets as of March 31, 2020 and 2019 F-3
   
Statements of Operations for the Years Ended March 31, 2020 and 2019 F-4
   
Statements of Changes in Stockholders’ Deficit for the Years Ended March 31, 2020 and 2019 F-5
   
Statements of Cash Flows for the Years Ended March 31, 2020 and 2019 F-6
   
Notes to Financial Statements F-7 to F-14

 

F-1

 

 

 

 

Report of Independent Registered Public Accounting Firm

 

To the Stockholders and the Board of Directors of:

LegacyXChange, Inc.

 

Opinion on the Financial Statements

 

We have audited the accompanying balance sheets of LegacyXChange, Inc. (the “Company”) as of March 31, 2020 and 2019, the related statements of operations, changes in stockholders’ deficit and cash flows for each of the two years in the period ended March 31, 2020 and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2020 and 2019, and the results of its operations and its cash flows for each of the two years in the period ended March 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

 

Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2, to the financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had an accumulated deficit, stockholders’ deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenue for the year ended March 31, 2020 and has defaulted on certain loans and convertible notes. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s Plan regarding these matters is also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

/s/ Salberg & Company, P.A.  
   
SALBERG & COMPANY, P.A.  

 

We have served as the Company’s auditor since 2013

Boca Raton, Florida

January 28, 2021

  

2295 NW Corporate Blvd., Suite 240 • Boca Raton, FL 33431

Phone: (561) 995-8270 • Toll Free: (866) CPA-8500 • Fax: (561) 995-1920

www.salbergco.com • info@salbergco.com

Member National Association of Certified Valuation Analysts • Registered with the PCAOB

Member CPAConnect with Affiliated Offices Worldwide Member Center for Public Company Audit Firms

 

F-2

 

 

LEGACYXCHANGE, INC.

BALANCE SHEETS

 

   March 31,
2020
   March 31,
2019
 
ASSETS        
CURRENT ASSETS:          
Cash  $21,152   $- 
           
Total Current Assets   21,152    - 
           
TOTAL ASSETS  $21,152   $- 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
CURRENT LIABILITIES:          
Accounts payable  $143,628   $138,153 
Accrued liabilities   675,708    552,695 
Loans payable - current portion   143,924    143,924 
Convertible notes   480,740    480,740 
Derivative liabilities   -    2,326 
           
Total Current Liabilities   1,444,000    1,317,838 
           
Loans payable - long term   45,000    - 
           
TOTAL LIABILITIES   1,489,000    1,317,838 
           
COMMITMENTS AND CONTINGENCIES          
           
STOCKHOLDERS’ DEFICIT:          
Preferred stock: $0.001 par value; 10,000,000 shares authorized; No shares issued or outstanding at March 31, 2020 and 2019   -    - 
Common stock: $0.001 par value; 190,000,000 shares authorized; 62,570,659 shares issued and outstanding at March 31, 2020 and 2019   62,571    62,571 
Additional paid-in capital   9,182,575    9,182,575 
Accumulated deficit   (10,712,994)   (10,562,984)
           
TOTAL STOCKHOLDERS’ DEFICIT   (1,467,848)   (1,317,838)
           
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT  $21,152   $- 

 

The accompanying notes are an integral part of these financial statements.

 

F-3

 

 

LEGACYXCHANGE, INC.

 STATEMENTS OF OPERATIONS

 

   For the Years Ended March 31, 
   2020   2019 
REVENUE, NET  $-   $- 
           
OPERATING EXPENSES          
Executive compensation   58,964    60,000 
Professional and consulting fees   28,400    2,550 
Other selling, general and administrative   923    875 
           
TOTAL OPERATING EXPENSES   88,287    63,425 
           
LOSS FROM OPERATIONS   (88,287)   (63,425)
           
OTHER INCOME (EXPENSE)          
Interest expense   (64,049)   (84,983)
Gain from extinguishment of debt   -    2,550 
Gain from change in fair value of derivative liabilities   -    3,148 
           
TOTAL OTHER EXPENSE, NET   (64,049)   (79,285)
           
NET LOSS  $(152,336)  $(142,710)
           
NET LOSS PER COMMON SHARE          
Basic and diluted  $(0.00)  $(0.00)
           
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:          
Basic and diluted   62,570,659    62,570,659 

 

The accompanying notes are an integral part of these financial statements.

 

F-4

 

 

LEGACYXCHANGE, INC.

STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

For the Years Ended March 31, 2020 and 2019

  

   Preferred Stock   Common Stock   Additional       Total 
   Number of
Shares
   Amount   Number of
Shares
   Amount   Paid-in
Capital
   Accumulated
Deficit
   Stockholders’
Deficit
 
Balance at March 31, 2018   -    -    62,570,659   $62,571   $9,182,575   $(10,420,274)   (1,175,128)
                                    
Net loss   -    -    -    -    -    (142,710)   (142,710)
                                    
Balance at March 31, 2019   -    -    62,570,659    62,571    9,182,575    (10,562,984)   (1,317,838)
                                    
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11   -    -    -    -    -    2,326    2,326 
                                    
Net loss   -    -    -    -    -    (152,336)   (152,336)
                                    
Balance at March 31, 2020   -    -    62,570,659   $62,571   $9,182,575   $(10,712,994)  $(1,467,848)

 

The accompanying notes are an integral part of these financial statements.

 

F-5

 

 

LEGACYXCHANGE, INC.

STATEMENTS OF CASH FLOWS

  

   For the Years Ended March 31, 
   2020   2019 
CASH FLOWS FROM OPERATING ACTIVITIES        
Net loss  $(152,336)  $(142,710)
Adjustments to reconcile net loss to net cash used in operating activities:          
Amortization of debt discount   -    21,649 
Gain from change in fair value of derivative liabilities   -    (3,148)
Gain from extinguishment of debt   -    (2,550)
Changes in operating assets and liabilities:          
Accounts payable   5,475    3,425 
Accrued liabilities   123,013    123,334 
           
Net cash used in operating activities   (23,848)   - 
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Proceeds from investor loans   45,000    - 
           
Net cash provided by financing activities   45,000    - 
           
Net increase in cash   21,152    - 
Cash - Beginning of year   -    - 
Cash - End of the year  $21,152   $- 
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          
Cash paid for:          
Interest  $-   $- 
Income taxes  $-   $- 
NON-CASH INVESTING AND FINANCING ACTIVITIES:          
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11  $-   $2,326 

 

The accompanying notes are an integral part of these financial statements.

 

F-6

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

 

LegacyXchange, Inc., formerly known as True 2 Beauty, Inc. (the “Company”) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus.

 

On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (“True2Bid”) which was incorporated in the state of Nevada. This subsidiary’s name was changed to LegacyXchange, Inc. (“LegacyXchange”) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction.

 

On July 2, 2015, pursuant to a Certificate of Dissolution filing with the Nevada Secretary of State, the Company dissolved LegacyXchange (formerly True2Bid, Inc.) to allow for the change in name of its parent company, True 2 Beauty, Inc., to LegacyXchange, Inc.

 

The Company is currently inactive due to lack of working capital to fund its operations.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”).

 

Going Concern

 

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company’s loans payable in the aggregate amount of $143,924 and $480,470 of convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report.

 

Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.

 

 Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Use of Estimates

 

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities.

 

F-7

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

Fair Value of Financial Instruments and Fair Value Measurements

 

FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

 

The three levels of the fair value hierarchy are as follows:

 

  Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
   
  Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
   
  Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

 

The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments.

 

Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2020 and 2019:

 

   At March 31, 2020   At March 31, 2019 
Description  Level 1   Level 2   Level 3   Level 1   Level 2   Level 3 
Derivative liabilities          $           $2,326 

 

A roll forward of the level 3 valuation financial instruments is as follows:

 

   For the Year Ended March 31, 
   2020   2019 
Balance at beginning of year  $2,326   $5,474 
Gain from change in fair value of derivative liabilities       (3,148)
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11   (2,326)    
Balance at end of year  $   $2,326 

 

ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments.

 

Cash

 

The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2020 and 2019. The Company has not experienced any losses in such accounts through March 31, 2020.

 

F-8

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

Derivative Liabilities

 

The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.

  

In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.

 

Revenue Recognition

 

In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.

 

Stock-Based Compensation

 

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

 

In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements.

 

Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company’s financial statements.

 

F-9

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

Income Taxes

 

The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

 

The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of March 31, 2020, and 2019, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. However, no such interest and penalties were recorded as of March 31, 2020.

 

Basic and Diluted Loss Per Share

 

Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2020 and 2019 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:

 

   March 31, 
   2020   2019 
Stock warrants   4,225,000    4,539,706 
Convertible notes   73,131,346    68,243,823 
Total   77,356,346    72,783,529 

 

Related Parties

 

Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.

 

Recent Accounting Pronouncements

 

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements.

 

NOTE 3 – ACCRUED LIABILITIES

 

At March 31, 2020 and 2019, accrued liabilities consisted of the following:

 

   March 31, 
   2020   2019 
Accrued interest  $312,210   $248,161 
Accrued professional fees   2,634    2,634 
Accrued payroll taxes   28,691    29,727 
Accrued executive and director compensation   332,173    272,173 
Total  $675,708   $552,695 

  

F-10

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

NOTE 4 – LOANS PAYABLE

 

   March 31, 
   2020   2019 
Current loans payable  $143,924   $143,924 
Long-term loans payable   45,000     
Total  $188,924   $143,924 

 

Between July 2015 through March 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $132,769. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.

 

Between April 2016 through May 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $11,155. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.

 

In November 2019 through March 2020, the Company entered into loan agreements with an investor in the principal amount of $45,000. This loan bears an interest rate of 6% and were due and payable on the second anniversary of the date of issuance of the loan.

 

As of March 31, 2020, these loans had outstanding principal and accrued interest of $188,924 and $61,637, respectively and $143,924 of the loans were on default. As of March 31, 2019, these loans were in default and had outstanding principal and accrued interest of $143,924 and $46,463, respectively.

 

During the years ended March 31, 2020 and 2019, the Company recorded interest expense of $15,174 and $14,592, respectively, on these loans.

 

NOTE 5 – CONVERTIBLE NOTES PAYABLE

 

At March 31, 2020 and 2019, convertible notes consisted of the following:

 

   March 31, 
   2020   2019 
Principal amount  $480,740   $480,740 
Convertible notes payable  $480,740   $480,740 

 

Fiscal 2015 Financing

 

In October and November 2014, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2015 Agreements”) for the sale of the Company’s convertible notes. Pursuant to the Fiscal 2015 Agreements, the Company issued to these purchasers, convertible promissory notes (the “Fiscal 2015 Convertible Notes”) for an aggregate principal amount of $400,000 with the Company receiving proceeds equal to the principal amount. The Fiscal 2015 Convertible Notes bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through October and November 2017. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2015 Convertible Notes, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.02 During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. During the year ended March 31, 2016, the purchasers converted $130,510 and $10,792 of outstanding principal and accrued interest, respectively, into 7,065,084 shares of the Company’s common stock. As of March 31, 2019, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $122,167, respectively. As of March 31, 2020, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $149,565, respectively.

 

F-11

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

Fiscal 2016 Financing

 

In May and June 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements I”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes I bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through May and June 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes I, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes I shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $45,053, respectively. As of March 31, 2020, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $56,744, respectively.

 

During August through September 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements II”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the “Fiscal 2016 Notes II”) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants II”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes II bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through August through September 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes II, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes II shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $34,478, respectively. As of March 31, 2020, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $44,264, respectively.

 

During the year ended March 31, 2020 and 2019, the Company recorded interest expense of $64,049 and $63,334, respectively, on these convertible notes.

 

Derivative Liabilities Pursuant to Notes and Warrants

 

In connection with the issuance of the Notes and Warrants, the Company determined that the terms of the Notes and Warrants contain terms that included a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception and included various other terms such as default provisions that caused derivative treatment. Accordingly, under the provisions of ASC 815-40 –Derivatives and Hedging – Contracts in an Entity’s Own Stock, the embedded conversion option contained in the convertible instruments and the Warrants were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives and warrant derivatives were determined using the Binomial valuation model. At the end of each period, on the date that debt was converted into common shares, and on the date of a cashless exercise of warrants, the Company revalued the embedded conversion option and warrants derivative liabilities.

 

In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability recorded.

 

At March 31, 2019, the Company revalued the conversion option and warrant derivative liabilities. In connection with this revaluation, the Company recorded gain from change on fair value of derivative liabilities of $3,148 for the year ended March 31, 2019.

 

F-12

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

At March 31, 2019, the fair value of the derivative liabilities was estimated using the Binomial option-pricing model with the following assumptions:

 

   2019 
Dividend rate  —% 
Term (in years)  0.1 to 1.5 years 
Volatility  159% to 219% 
Risk—free interest rate  2.40%

 

For the years ended March 31, 2020 and 2019, amortization of debt discounts related to the convertible notes amounted to $0 and $21,649, respectively, which has been included in interest expense on the accompanying statements of operations.

 

NOTE 6 – STOCKHOLDERS’ DEFICIT

 

Authorized shares

 

The Company is authorized to issue 200,000,000 consisting of 190,000,000 shares of common stock at $0.001 per share par value, and 10,000,000 shares of preferred stock at $0.001 per share par value.

 

Preferred Stock

 

As of March 31, 2020 and 2019, the Company did not have any preferred stock issued and outstanding.

 

Common Stock

 

As of March 31, 2020 and 2019, the Company had 62,570,659 shares of common stock issued and outstanding.

 

Warrants

 

Warrants issued pursuant to equity subscription agreements

 

During fiscal years 2013 to 2015, in connection with the sale of common stock, the Company issued an aggregate of 1,048,315 five-year warrants to purchase common shares for an exercise price of $0.40 per common share to investors pursuant to unit subscription agreements. These warrants were accounted for as equity. As of March 31, 2019, 314,706 warrants were issued and outstanding. During the year ended March 31, 2020, all of the 314,706 warrants expired. As of March 31, 2020, there were no warrants issued and outstanding.

 

Warrants issued in connection with the Fiscal 2016 Financing

 

During fiscal years 2016, pursuant to the convertible note agreements under the fiscal 2016 financing discussed in Note 5, the Company issued five-year warrants to purchase an aggregate of 4,225,000 (twenty warrants for each dollar of the principal amount) shares of the Company’s common stock at an exercise price of $0.07. The exercise price of these warrants shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price and were accounted for as derivative liabilities. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2020 and 2019, 4,225,000 warrants were issued and outstanding.

 

Warrant activity for the years ended March 31, 2020 and 2019 are summarized as follows

 

   Number of
Warrants
   Weighted
Average
Exercise Price
   Weighted
Average
Remaining
Contractual
Term (Years)
   Aggregate
Intrinsic Value
 
Balance Outstanding at March 31, 2018   4,554,707   $0.04    2.2   $ 
Expired   (15,001)  $0.40       $ 
Balance Outstanding at March 31, 2019   4,539,706   $0.04    1.2   $ 
Expired   (314,706)  $0.40       $ 
Balance Outstanding at March 31, 2020   4,225,000   $0.01    0.3   $ 
Exercisable at March 31, 2020   4,225,000   $0.01    0.3   $ 

 

F-13

 

 

LEGACYXCHANGE, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2020 and 2019

 

NOTE 7 – INCOME TAXES

 

The Company maintains deferred tax assets and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets at March 31, 2020 and 2019 consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the uncertainty of the attainment of future taxable income.

 

The items accounting for the difference between income taxes at the effective statutory rate and the provision for income taxes for the years ended March 31, 2020 and 2019 were as follows:

 

   Years Ended March 31, 
   2020   2019 
Income tax benefit at U.S. statutory rate of 21%  $(31,991)  $(29,969)
Income tax benefit - State   (7,617)   (7,136)
Non-deductible expenses   605    4,147 
Change in valuation allowance   39,003    32,958 
Total provision for income tax  $   $ 

 

The Company’s approximate net deferred tax asset at March 31, 2020 and 2019 was as follows:

 

   Years Ended March 31, 
Deferred Tax Asset:  2020   2019 
Net operating losses  $1,076,355   $1,037,352 
Valuation allowance   (1,076,355)   (1,037,352)
Net deferred tax asset  $   $ 

 

The net operating loss carryforward was $4,139,824 and $3,989,814 at March 31, 2020 and 2019, respectively. The Company provided a valuation allowance equal to the deferred income tax asset for the years ended March 31, 2020 and 2019 because it was not known whether future taxable income will be sufficient to utilize the loss carryforward. The change in the allowance was $39,003 and $32,958 for the years ended March 31, 2020 and 2019, respectively.

 

These net operating loss carryforwards may be available to reduce future years’ taxable income. The potential tax benefit arising from the loss carryforward of $967,537 will expire through 2037. The potential tax benefit arising from the net operating loss carryforward of $108,818 from the period following to the Act’s effective date can be carried forward indefinitely within the annual usage limitations.

 

Additionally, the future utilization of the net operating loss carryforward to offset future taxable income may be subject to an annual limitation as a result of ownership changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforward that expires prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance.

 

The Company does not have any uncertain tax positions or events leading to uncertainty in a tax position. The Company’s Corporate Income Tax Returns from 2017 through 2020 are subject to Internal Revenue Service examination.

 

NOTE 8 – SUBSEQUENT EVENTS

 

In June 2020, the Company entered into loan agreements with an investor in the aggregate principal amount of $46,000. The loans bear interest rate of 6% and were due and payable two-years from the date of issuances.

 

F-14

EX-31.1 2 f10k2020ex31-1_legacyx.htm CERTIFICATION

Exhibit 31.1

 

Certificate of Principal Executive Officer

Pursuant to Rule 13a-14(a)/15d-14(a)

 

I, William Bollander, certify that:

 

1.I have reviewed this annual report on Form 10-K for the year ended March 31, 2020 of LegacyXchange, Inc. (the “registrant”);

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present, in all material respects, the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

 

4.The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in the Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting) as defined in the Exchange Act Rules 13a - 15(f) and 15d - 15(f)) for the registrant and have:

 

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the registrant’s board of directors:

 

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

  LegacyXchange, Inc.
 Date: January 28, 2021    
  By: s/ William Bollander
    William Bollander
    Chief Executive Officer, Chief Financial Officer and President (Principal Executive, Financial and Accounting Officer)
EX-32.1 3 f10k2020ex32-1_legacyx.htm CERTIFICATION

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report on Form 10-K of LegacyXchange, Inc. (the “Company”) for the year ended March 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, William Bollander, Chief Executive Officer, Chief Financial Officer and President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

 

1.The Report fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

 

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

  LegacyXchange, Inc.
 Date: January 28, 2021    
  By: /s/ William Bollander
    William Bollander
    Chief Executive Officer, Chief Financial Officer and President (Principal Executive, Financial and Accounting Officer)

 

 

 

 

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(the &#x201c;Company&#x201d;) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (&#x201c;True2Bid&#x201d;) which was incorporated in the state of Nevada. This subsidiary&#x2019;s name was changed to LegacyXchange, Inc. (&#x201c;LegacyXchange&#x201d;) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On July 2, 2015, pursuant to a Certificate of Dissolution filing with the Nevada Secretary of State, the Company dissolved LegacyXchange (formerly True2Bid, Inc.) to allow for the change in name of its parent company, True 2 Beauty, Inc., to LegacyXchange, Inc.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company is currently inactive due to lack of working capital to fund its operations.</font></p><br/> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 2 &#x2013; <font style="text-decoration:underline">SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Basis of Presentation </b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the &#x201c;U.S. GAAP&#x201d;).</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Going Concern</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders&#x2019; deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company&#x2019;s loans payable in the aggregate amount of $143,924 and $480,470 of convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company&#x2019;s ability to continue as a going concern for twelve months from the issuance date of this report.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#xa0;Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Use of Estimates</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities.</font></p><br/><p style="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Fair Value of Financial Instruments and Fair Value Measurements</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. 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text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 2</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 3</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 28%; text-align: left">Derivative liabilities</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; 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text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Balance at beginning of year</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">5,474</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left">Gain from change in fair value of derivative liabilities</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">&#x2014;</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(3,148</td><td style="text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(2,326</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Balance at end of year</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">2,326</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">ASC 825-10 &#x201c;Financial Instruments&#x201d;, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Cash </b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2020 and 2019. The Company has not experienced any losses in such accounts through March 31, 2020.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Derivative Liabilities</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 <i>&#x2013; Derivative and Hedging &#x2013; Contract in Entity&#x2019;s Own Equity</i>. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Revenue Recognition</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31 2018. The adoption of ASU 2014-09 did not have any material impact on the Company&#x2019;s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Stock-Based Compensation</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation &#x2014; Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company&#x2019;s financial statements.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company&#x2019;s financial statements.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Income Taxes</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 <i>&#x201c;Income Taxes</i>&#x201d;. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of March 31, 2020, and 2019, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. However, no such interest and penalties were recorded as of March 31, 2020.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Basic and Diluted Loss Per Share</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2020 and 2019 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31,</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2020</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Stock warrants</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,225,000</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,539,706</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Convertible notes</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">73,131,346</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">68,243,823</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">77,356,346</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">72,783,529</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Related Parties</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Recent Accounting Pronouncements</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company&#x2019;s financial statements.</font></p><br/> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Basis of Presentation </b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the &#x201c;U.S. GAAP&#x201d;).</font></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Going Concern</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders&#x2019; deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company&#x2019;s loans payable in the aggregate amount of $143,924 and $480,470 of convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company&#x2019;s ability to continue as a going concern for twelve months from the issuance date of this report.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#xa0;Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.</font></p> -152336 1467848 1422848 480470 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Use of Estimates</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities.</font></p> <p style="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Fair Value of Financial Instruments and Fair Value Measurements</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. 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font-size: 10pt">Level 1&#x2014;Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.</font></td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#xa0;</font></td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#xa0;</font></td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#xa0;</font></td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level 2&#x2014;Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.</font></td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; 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margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2020 and 2019:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="text-align: left">&#xa0;</td><td style="font-weight: bold; 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text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 2</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 3</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 28%; text-align: left">Derivative liabilities</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; 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text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">5,474</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left">Gain from change in fair value of derivative liabilities</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">&#x2014;</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(3,148</td><td style="text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(2,326</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Balance at end of year</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">2,326</td><td style="padding-bottom: 2pt; 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The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 <i>&#x2013; Derivative and Hedging &#x2013; Contract in Entity&#x2019;s Own Equity</i>. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.</font></p> 2326 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Revenue Recognition</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31 2018. The adoption of ASU 2014-09 did not have any material impact on the Company&#x2019;s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.</font></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Stock-Based Compensation</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation &#x2014; Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company&#x2019;s financial statements.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company&#x2019;s financial statements.</font></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Income Taxes</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 <i>&#x201c;Income Taxes</i>&#x201d;. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of March 31, 2020, and 2019, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. However, no such interest and penalties were recorded as of March 31, 2020.</font></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Basic and Diluted Loss Per Share</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2020 and 2019 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31,</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2020</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Stock warrants</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,225,000</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,539,706</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Convertible notes</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">73,131,346</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">68,243,823</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">77,356,346</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">72,783,529</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Related Parties</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.</font></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Recent Accounting Pronouncements</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company&#x2019;s financial statements.</font></p> <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="text-align: left">&#xa0;</td><td style="font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="10" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">At March 31, 2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="10" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">At March 31, 2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: left">Description</td><td style="font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 1</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 2</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 3</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 1</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 2</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Level 3</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 28%; text-align: left">Derivative liabilities</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> </table> 2326 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">For the Year Ended March&#xa0;31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Balance at beginning of year</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">2,326</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">5,474</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left">Gain from change in fair value of derivative liabilities</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">&#x2014;</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(3,148</td><td style="text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(2,326</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Balance at end of year</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">2,326</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 5474 -3148 -2326 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31,</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-indent: -0.125in; text-align: center">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2020</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Stock warrants</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,225,000</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,539,706</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Convertible notes</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">73,131,346</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">68,243,823</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">77,356,346</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">72,783,529</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 4225000 4539706 73131346 68243823 77356346 72783529 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 3 &#x2013; <font style="text-decoration:underline">ACCRUED LIABILITIES</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">At March 31, 2020 and 2019, accrued liabilities consisted of the following:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Accrued interest</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">312,210</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">248,161</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left">Accrued professional fees</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">2,634</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">2,634</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left">Accrued payroll taxes</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">28,691</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">29,727</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Accrued executive and director compensation</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">332,173</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">272,173</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">675,708</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">552,695</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/> <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Accrued interest</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">312,210</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">248,161</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left">Accrued professional fees</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">2,634</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">2,634</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left">Accrued payroll taxes</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">28,691</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">29,727</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Accrued executive and director compensation</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">332,173</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">272,173</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.25in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">675,708</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">552,695</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 312210 248161 2634 2634 28691 29727 332173 272173 675708 552695 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 4 &#x2013; <font style="text-decoration:underline">LOANS PAYABLE</font></b></font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Current loans payable</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">143,924</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">143,924</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Long-term loans payable</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">45,000</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">188,924</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">143,924</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Between July 2015 through March 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $132,769. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Between April 2016 through May 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $11,155. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In November 2019 through March 2020, the Company entered into loan agreements with an investor in the principal amount of $45,000. This loan bears an interest rate of 6% and were due and payable on the second anniversary of the date of issuance of the loan.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">As of March 31, 2020, these loans had outstanding principal and accrued interest of $188,924 and $61,637, respectively and $143,924 of the loans were on default. As of March 31, 2019, these loans were in default and had outstanding principal and accrued interest of $143,924 and $46,463, respectively.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">During the years ended March 31, 2020 and 2019, the Company recorded interest expense of $15,174 and $14,592, respectively, on these loans.</font></p><br/> 132769 0.10 11155 0.10 45000 0.06 188924 61637 143924 143924 46463 15174 14592 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; padding-left: 0.125in; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left">Current loans payable</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">143,924</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">143,924</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 1.5pt">Long-term loans payable</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">45,000</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Total</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">188,924</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">143,924</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 188924 143924 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 5 &#x2013; <font style="text-decoration:underline">CONVERTIBLE NOTES PAYABLE</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">At March 31, 2020 and 2019, convertible notes consisted of the following:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left; padding-bottom: 1.5pt">Principal amount</td><td style="width: 1%; padding-bottom: 1.5pt">&#xa0;</td> <td style="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">480,740</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="width: 1%; padding-bottom: 1.5pt">&#xa0;</td> <td style="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">480,740</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Convertible notes payable</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">480,740</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">480,740</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b><i>Fiscal 2015 Financing</i></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In October and November 2014, the Company entered into a subscription agreement with various purchasers (the &#x201c;Fiscal 2015 Agreements&#x201d;) for the sale of the Company&#x2019;s convertible notes. Pursuant to the Fiscal 2015 Agreements, the Company issued to these purchasers, convertible promissory notes (the &#x201c;Fiscal 2015 Convertible Notes&#x201d;) for an aggregate principal amount of $400,000 with the Company receiving proceeds equal to the principal amount. The Fiscal 2015 Convertible Notes bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through October and November 2017. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2015 Convertible Notes, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company&#x2019;s common stock at a conversion price of $0.02 During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. During the year ended March 31, 2016, the purchasers converted $130,510 and $10,792 of outstanding principal and accrued interest, respectively, into 7,065,084 shares of the Company&#x2019;s common stock. As of March 31, 2019, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $122,167, respectively. As of March 31, 2020, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $149,565, respectively.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b><i>Fiscal 2016 Financing</i></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In May and June 2015, the Company entered into a subscription agreement with various purchasers (the &#x201c;Fiscal 2016 Agreements I&#x201d;) for the sale of the Company&#x2019;s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the &#x201c;Fiscal 2016 Notes I&#x201d;) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company&#x2019;s common stock at an exercise price of $0.07 (the &#x201c;Fiscal 2016 Warrants I&#x201d;). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes I bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through May and June 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes I, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company&#x2019;s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes I shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $45,053, respectively. As of March 31, 2020, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $56,744, respectively.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">During August through September 2015, the Company entered into a subscription agreement with various purchasers (the &#x201c;Fiscal 2016 Agreements II&#x201d;) for the sale of the Company&#x2019;s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the &#x201c;Fiscal 2016 Notes II&#x201d;) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company&#x2019;s common stock at an exercise price of $0.07 (the &#x201c;Fiscal 2016 Warrants II&#x201d;). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes II bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through August through September 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes II, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company&#x2019;s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes II shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $34,478, respectively. As of March 31, 2020, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $44,264, respectively.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">During the year ended March 31, 2020 and 2019, the Company recorded interest expense of $64,049 and $63,334, respectively, on these convertible notes.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b><i>Derivative Liabilities Pursuant to Notes and Warrants</i></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In connection with the issuance of the Notes and Warrants, the Company determined that the terms of the Notes and Warrants contain terms that included a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception and included various other terms such as default provisions that caused derivative treatment. Accordingly, under the provisions of ASC 815-40 &#x2013;<i>Derivatives and Hedging &#x2013; Contracts in an Entity&#x2019;s Own Stock</i>, the embedded conversion option contained in the convertible instruments and the Warrants were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives and warrant derivatives were determined using the Binomial valuation model. At the end of each period, on the date that debt was converted into common shares, and on the date of a cashless exercise of warrants, the Company revalued the embedded conversion option and warrants derivative liabilities.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability recorded.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">At March 31, 2019, the Company revalued the conversion option and warrant derivative liabilities. In connection with this revaluation, the Company recorded gain from change on fair value of derivative liabilities of $3,148 for the year ended March 31, 2019.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">At March 31, 2019, the fair value of the derivative liabilities was estimated using the Binomial option-pricing model with the following assumptions:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">&#xa0;</td><td style="font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">2019</td><td style="padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Dividend rate</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#x2014;%</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Term (in years)</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">0.1 to 1.5 years</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Volatility</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">159% to 219%</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 86%; text-align: left; vertical-align: top">Risk&#x2014;free interest rate</td><td style="width: 1%">&#xa0;</td> <td style="width: 12%; text-align: center">2.40%</td><td style="width: 1%; text-align: left"></td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">For the years ended March 31, 2020 and 2019, amortization of debt discounts related to the convertible notes amounted to $0 and $21,649, respectively, which has been included in interest expense on the accompanying statements of operations.</font></p><br/> 400000 400000 0.10 0.10 0.02 0.01 130510 10792 7065084 269490 122167 269490 149565 Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the &#x201c;Fiscal 2016 Notes I&#x201d;) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company&#x2019;s common stock at an exercise price of $0.07 (the &#x201c;Fiscal 2016 Warrants I&#x201d;). Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the &#x201c;Fiscal 2016 Notes I&#x201d;) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company&#x2019;s common stock at an exercise price of $0.07 (the &#x201c;Fiscal 2016 Warrants I&#x201d;). 0.10 0.10 0.05 0.01 115000 45053 115000 56744 Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the &#x201c;Fiscal 2016 Notes II&#x201d;) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company&#x2019;s common stock at an exercise price of $0.07 (the &#x201c;Fiscal 2016 Warrants II&#x201d;). 0.10 0.05 0.01 96250 34478 96250 44264 64049 63334 2326 3148 0 21649 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="6" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31,</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: left">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2020</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">2019</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 76%; text-align: left; padding-bottom: 1.5pt">Principal amount</td><td style="width: 1%; padding-bottom: 1.5pt">&#xa0;</td> <td style="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">480,740</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="width: 1%; padding-bottom: 1.5pt">&#xa0;</td> <td style="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">480,740</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; padding-bottom: 4pt">Convertible notes payable</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">480,740</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">480,740</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 480740 480740 480740 480740 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">&#xa0;</td><td style="font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">2019</td><td style="padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Dividend rate</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#x2014;%</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Term (in years)</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">0.1 to 1.5 years</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; text-align: left; vertical-align: top">Volatility</td><td>&#xa0;</td> <td style="text-align: center"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">159% to 219%</font></td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 86%; text-align: left; vertical-align: top">Risk&#x2014;free interest rate</td><td style="width: 1%">&#xa0;</td> <td style="width: 12%; text-align: center">2.40%</td><td style="width: 1%; text-align: left"></td></tr> </table> P36D P1Y6M 1.59 2.19 0.0240 <p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 6 &#x2013; <font style="text-decoration:underline">STOCKHOLDERS&#x2019; DEFICIT</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Authorized shares</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company is authorized to issue 200,000,000 consisting of 190,000,000 shares of common stock at $0.001 per share par value, and 10,000,000 shares of preferred stock at $0.001 per share par value.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Preferred Stock</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">As of March 31, 2020 and 2019, the Company did not have any preferred stock issued and outstanding.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Common Stock</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">As of March 31, 2020 and 2019, the Company had 62,570,659 shares of common stock issued and outstanding.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Warrants</b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><font style="text-decoration:underline">Warrants issued pursuant to equity subscription agreements</font></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">During fiscal years 2013 to 2015, in connection with the sale of common stock, the Company issued an aggregate of 1,048,315 five-year warrants to purchase common shares for an exercise price of $0.40 per common share to investors pursuant to unit subscription agreements. These warrants were accounted for as equity. As of March 31, 2019, 314,706 warrants were issued and outstanding. During the year ended March 31, 2020, all of the 314,706 warrants expired. As of March 31, 2020, there were no warrants issued and outstanding.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><font style="text-decoration:underline">Warrants issued in connection with the Fiscal 2016 Financing</font></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">During fiscal years 2016, pursuant to the convertible note agreements under the fiscal 2016 financing discussed in Note 5, the Company issued five-year warrants to purchase an aggregate of 4,225,000 (twenty warrants for each dollar of the principal amount) shares of the Company&#x2019;s common stock at an exercise price of $0.07. The exercise price of these warrants shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price and were accounted for as derivative liabilities. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2020 and 2019, 4,225,000 warrants were issued and outstanding.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrant activity for the years ended March 31, 2020 and 2019 are summarized as follows</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Number of<br/> Warrants</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Weighted<br/> Average<br/> Exercise Price</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Weighted<br/> Average<br/> Remaining<br/> Contractual<br/> Term (Years)</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Aggregate<br/> Intrinsic Value</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 52%; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2018</b></font></td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,554,707</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">0.04</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">2.2</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 1.5pt; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Expired</font></td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(15,001</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">0.40</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2019</b></font></td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">4,539,706</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">$</td><td style="text-align: right">0.04</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">1.2</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">$</td><td style="text-align: right">&#x2014;</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 1.5pt; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Expired</font></td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(314,706</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">0.40</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 4pt; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2020</b></font></td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">4,225,000</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">0.01</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 2pt; text-align: right">0.3</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 4pt; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Exercisable at March 31, 2020</b></font></td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">4,225,000</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">0.01</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 2pt; text-align: right">0.3</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/> 200000000 1048315 0.40 314706 314706 4225000 0.07 0.01 4225000 4225000 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="padding-left: 0.125in; text-indent: -0.125in; vertical-align: bottom; text-align: center">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Number of<br/> Warrants</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Weighted<br/> Average<br/> Exercise Price</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Weighted<br/> Average<br/> Remaining<br/> Contractual<br/> Term (Years)</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td><td style="vertical-align: bottom; text-align: center; font-weight: bold; padding-bottom: 1.5pt">&#xa0;</td> <td colspan="2" style="vertical-align: bottom; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Aggregate<br/> Intrinsic Value</td><td style="vertical-align: bottom; text-align: center; padding-bottom: 1.5pt; font-weight: bold">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; width: 52%; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2018</b></font></td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">4,554,707</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">0.04</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 9%; text-align: right">2.2</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">&#x2014;</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 1.5pt; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Expired</font></td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(15,001</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">0.40</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2019</b></font></td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">4,539,706</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">$</td><td style="text-align: right">0.04</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">1.2</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">$</td><td style="text-align: right">&#x2014;</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 1.5pt; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Expired</font></td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(314,706</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">0.40</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="padding-bottom: 1.5pt; text-align: left">$</td><td style="padding-bottom: 1.5pt; text-align: right">&#x2014;</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 4pt; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Balance Outstanding at March 31, 2020</b></font></td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">4,225,000</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">0.01</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 2pt; text-align: right">0.3</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="padding-left: 0.125in; text-indent: -0.125in; padding-bottom: 4pt; font-weight: bold; text-align: left"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>Exercisable at March 31, 2020</b></font></td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">&#xa0;</td><td style="border-bottom: Black 4pt double; text-align: right">4,225,000</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">0.01</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 2pt; text-align: right">0.3</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="padding-bottom: 2pt; text-align: left">$</td><td style="padding-bottom: 2pt; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 4554707 0.04 P2Y73D 15001 0.40 4539706 0.04 P1Y73D 314706 0.40 4225000 0.01 P109D 4225000 0.01 P109D <p style="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-top: 0pt; margin-bottom: 0pt"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 7 &#x2013; <font style="text-decoration:underline">INCOME TAXES</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The Company maintains deferred tax assets and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets at March 31, 2020 and 2019 consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the uncertainty of the attainment of future taxable income.</font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The items accounting for the difference between income taxes at the effective statutory rate and the provision for income taxes for the years ended March 31, 2020 and 2019 were as follows:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; text-align: center; padding-left: 0.125in; text-indent: -0.125in">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="6" style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">Years Ended March 31,</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; text-align: center; padding-left: 0.125in; text-indent: -0.125in">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">2020</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="2" style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">2019</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold; vertical-align: bottom">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%; text-align: left; padding-left: 0.125in; text-indent: -0.125in">Income tax benefit at U.S. statutory rate of 21%</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">(31,991</td><td style="width: 1%; text-align: left">)</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">(29,969</td><td style="width: 1%; text-align: left">)</td></tr> <tr style="vertical-align: bottom; "> <td style="text-align: left; padding-left: 0.125in; text-indent: -0.125in">Income tax benefit - State</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(7,617</td><td style="text-align: left">)</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(7,136</td><td style="text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 0.125in; text-indent: -0.125in">Non-deductible expenses</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">605</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">4,147</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="text-align: left; padding-bottom: 1.5pt; padding-left: 0.125in; text-indent: -0.125in">Change in valuation allowance</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">39,003</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">32,958</td><td style="padding-bottom: 1.5pt; 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text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,076,355</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,037,352</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 4pt; padding-left: 0.125in; text-indent: -0.125in">Net deferred tax asset</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table><br/><p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The net operating loss carryforward was $4,139,824 and $3,989,814 at March 31, 2020 and 2019, respectively. 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text-align: left">)</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">(29,969</td><td style="width: 1%; text-align: left">)</td></tr> <tr style="vertical-align: bottom; "> <td style="text-align: left; padding-left: 0.125in; text-indent: -0.125in">Income tax benefit - State</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(7,617</td><td style="text-align: left">)</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">(7,136</td><td style="text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 0.125in; text-indent: -0.125in">Non-deductible expenses</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">605</td><td style="text-align: left">&#xa0;</td><td>&#xa0;</td> <td style="text-align: left">&#xa0;</td><td style="text-align: right">4,147</td><td style="text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="text-align: left; padding-bottom: 1.5pt; padding-left: 0.125in; text-indent: -0.125in">Change in valuation allowance</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">39,003</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">32,958</td><td style="padding-bottom: 1.5pt; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 4pt; padding-left: 0.125in; text-indent: -0.125in">Total provision for income tax</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> -31991 -29969 -7617 -7136 605 4147 39003 32958 0.2100 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td style="vertical-align: bottom; text-align: center; padding-left: 0.125in; text-indent: -0.125in">&#xa0;</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt; vertical-align: bottom">&#xa0;</td> <td colspan="6" style="border-bottom: Black 1.5pt solid; vertical-align: bottom; font-weight: bold; text-align: center">Years Ended March&#xa0;31,</td><td style="text-align: center; padding-bottom: 1.5pt; 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text-align: left">$</td><td style="width: 9%; text-align: right">1,076,355</td><td style="width: 1%; text-align: left">&#xa0;</td><td style="width: 1%">&#xa0;</td> <td style="width: 1%; text-align: left">$</td><td style="width: 9%; text-align: right">1,037,352</td><td style="width: 1%; text-align: left">&#xa0;</td></tr> <tr style="vertical-align: bottom; "> <td style="text-align: left; padding-bottom: 1.5pt; padding-left: 0.125in; text-indent: -0.125in">Valuation allowance</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,076,355</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt">&#xa0;</td> <td style="border-bottom: Black 1.5pt solid; text-align: left">&#xa0;</td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,037,352</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 4pt; padding-left: 0.125in; text-indent: -0.125in">Net deferred tax asset</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td><td style="padding-bottom: 4pt">&#xa0;</td> <td style="border-bottom: Black 4pt double; text-align: left">$</td><td style="border-bottom: Black 4pt double; text-align: right">&#x2014;</td><td style="padding-bottom: 2pt; text-align: left">&#xa0;</td></tr> </table> 1076355 1037352 1076355 1037352 <p style="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><font style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 8 &#x2013; <font style="text-decoration:underline">SUBSEQUENT EVENTS</font></b></font></p><br/><p style="font: 10pt Times New Roman, Times, Serif; 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12 Months Ended
Mar. 31, 2020
Jan. 25, 2021
Sep. 30, 2019
Document Information Line Items      
Entity Registrant Name LegacyXChange, Inc.    
Document Type 10-K    
Current Fiscal Year End Date --03-31    
Entity Common Stock, Shares Outstanding   62,570,659  
Entity Public Float     $ 90,384
Amendment Flag false    
Entity Central Index Key 0001423579    
Entity Current Reporting Status No    
Entity Voluntary Filers No    
Entity Filer Category Non-accelerated Filer    
Entity Well-known Seasoned Issuer No    
Document Period End Date Mar. 31, 2020    
Document Fiscal Year Focus 2020    
Document Fiscal Period Focus FY    
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Mar. 31, 2020
Mar. 31, 2019
CURRENT ASSETS:    
Cash $ 21,152
Total Current Assets 21,152
TOTAL ASSETS 21,152
CURRENT LIABILITIES:    
Accounts payable 143,628 138,153
Accrued liabilities 675,708 552,695
Loans payable - current portion 143,924 143,924
Convertible notes 480,740 480,740
Derivative liabilities 2,326
Total Current Liabilities 1,444,000 1,317,838
Loans payable - long term 45,000
TOTAL LIABILITIES 1,489,000 1,317,838
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT:    
Preferred stock: $0.001 par value; 10,000,000 shares authorized; No shares issued or outstanding at March 31, 2020 and 2019
Common stock: $0.001 par value; 190,000,000 shares authorized; 62,570,659 shares issued and outstanding at March 31, 2020 and 2019 62,571 62,571
Additional paid-in capital 9,182,575 9,182,575
Accumulated deficit (10,712,994) (10,562,984)
TOTAL STOCKHOLDERS’ DEFICIT (1,467,848) (1,317,838)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT $ 21,152
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Mar. 31, 2019
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Preferred stock, shares issued
Preferred stock, shares outstanding
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Common stock, shares authorized 190,000,000 190,000,000
Common stock, shares issued 62,570,659 62,570,659
Common stock, shares outstanding 62,570,659 62,570,659
XML 14 R4.htm IDEA: XBRL DOCUMENT v3.20.4
Statements of Operations - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Income Statement [Abstract]    
REVENUE, NET
OPERATING EXPENSES    
Executive compensation 58,964 60,000
Professional and consulting fees 28,400 2,550
Other selling, general and administrative 923 875
TOTAL OPERATING EXPENSES 88,287 63,425
LOSS FROM OPERATIONS (88,287) (63,425)
OTHER INCOME (EXPENSE)    
Interest expense (64,049) (84,983)
Gain from extinguishment of debt 2,550
Gain from change in fair value of derivative liabilities 3,148
TOTAL OTHER EXPENSE, NET (64,049) (79,285)
NET LOSS $ (152,336) $ (142,710)
NET LOSS PER COMMON SHARE    
Basic and diluted (in Dollars per share) $ 0.00 $ 0.00
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:    
Basic and diluted (in Shares) 62,570,659 62,570,659
XML 15 R5.htm IDEA: XBRL DOCUMENT v3.20.4
Statement of Changes in Stockholders’ Deficit - USD ($)
Preferred Stock
Common Stock
Additional Paid-in Capital
Accumulated Deficit
Total
Balance at beginning at Mar. 31, 2018 $ 62,571 $ 9,182,575 $ (10,420,274) $ (1,175,128)
Balance at beginning (in Shares) at Mar. 31, 2018 62,570,659      
Net loss (142,710) (142,710)
Balance at Ending at Mar. 31, 2019 $ 62,571 9,182,575 (10,562,984) (1,317,838)
Balance at Ending (in Shares) at Mar. 31, 2019 62,570,659      
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11 2,326 2,326
Net loss (152,336) (152,336)
Balance at Ending at Mar. 31, 2020 $ 62,571 $ 9,182,575 $ (10,712,994) $ (1,467,848)
Balance at Ending (in Shares) at Mar. 31, 2020 62,570,659      
XML 16 R6.htm IDEA: XBRL DOCUMENT v3.20.4
Statements of Cash Flows - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES    
Net loss $ (152,336) $ (142,710)
Adjustments to reconcile net loss to net cash used in operating activities:    
Amortization of debt discount 21,649
Gain from change in fair value of derivative liabilities (3,148)
Gain from extinguishment of debt (2,550)
Changes in operating assets and liabilities:    
Accounts payable 5,475 3,425
Accrued liabilities 123,013 123,334
Net cash used in operating activities (23,848)
CASH FLOWS FROM FINANCING ACTIVITIES    
Proceeds from investor loans 45,000
Net cash provided by financing activities 45,000
Net increase in cash 21,152
Cash - Beginning of year
Cash - End of the year 21,152
Cash paid for:    
Interest
Income taxes
NON-CASH INVESTING AND FINANCING ACTIVITIES:    
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11 $ 2,326
XML 17 R7.htm IDEA: XBRL DOCUMENT v3.20.4
Organization and Nature of Operations
12 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
ORGANIZATION AND NATURE OF OPERATIONS

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS


LegacyXchange, Inc., formerly known as True 2 Beauty, Inc. (the “Company”) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus.


On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (“True2Bid”) which was incorporated in the state of Nevada. This subsidiary’s name was changed to LegacyXchange, Inc. (“LegacyXchange”) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction.


On July 2, 2015, pursuant to a Certificate of Dissolution filing with the Nevada Secretary of State, the Company dissolved LegacyXchange (formerly True2Bid, Inc.) to allow for the change in name of its parent company, True 2 Beauty, Inc., to LegacyXchange, Inc.


The Company is currently inactive due to lack of working capital to fund its operations.


XML 18 R8.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies
12 Months Ended
Mar. 31, 2020
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Basis of Presentation


The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”).


Going Concern


The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company’s loans payable in the aggregate amount of $143,924 and $480,470 of convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report.


Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.


 Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.


Use of Estimates


The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities.


Fair Value of Financial Instruments and Fair Value Measurements


FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).


The three levels of the fair value hierarchy are as follows:


  Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
   
  Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
   
  Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments.


Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2020 and 2019:


   At March 31, 2020   At March 31, 2019 
Description  Level 1   Level 2   Level 3   Level 1   Level 2   Level 3 
Derivative liabilities          $           $2,326 

A roll forward of the level 3 valuation financial instruments is as follows:


   For the Year Ended March 31, 
   2020   2019 
Balance at beginning of year  $2,326   $5,474 
Gain from change in fair value of derivative liabilities       (3,148)
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11   (2,326)    
Balance at end of year  $   $2,326 

ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments.


Cash


The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2020 and 2019. The Company has not experienced any losses in such accounts through March 31, 2020.


Derivative Liabilities


The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.


In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.


Revenue Recognition


In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.


Stock-Based Compensation


Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.


In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements.


Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company’s financial statements.


Income Taxes


The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.


The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of March 31, 2020, and 2019, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. However, no such interest and penalties were recorded as of March 31, 2020.


Basic and Diluted Loss Per Share


Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2020 and 2019 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:


   March 31, 
   2020   2019 
Stock warrants   4,225,000    4,539,706 
Convertible notes   73,131,346    68,243,823 
Total   77,356,346    72,783,529 

Related Parties


Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.


Recent Accounting Pronouncements


Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements.


XML 19 R9.htm IDEA: XBRL DOCUMENT v3.20.4
Accrued Liabilities
12 Months Ended
Mar. 31, 2020
Payables and Accruals [Abstract]  
ACCRUED LIABILITIES

NOTE 3 – ACCRUED LIABILITIES


At March 31, 2020 and 2019, accrued liabilities consisted of the following:


   March 31, 
   2020   2019 
Accrued interest  $312,210   $248,161 
Accrued professional fees   2,634    2,634 
Accrued payroll taxes   28,691    29,727 
Accrued executive and director compensation   332,173    272,173 
Total  $675,708   $552,695 

XML 20 R10.htm IDEA: XBRL DOCUMENT v3.20.4
Loans Payable
12 Months Ended
Mar. 31, 2020
Debt Disclosure [Abstract]  
LOANS PAYABLE

NOTE 4 – LOANS PAYABLE


   March 31, 
   2020   2019 
Current loans payable  $143,924   $143,924 
Long-term loans payable   45,000     
Total  $188,924   $143,924 

Between July 2015 through March 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $132,769. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.


Between April 2016 through May 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $11,155. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans.


In November 2019 through March 2020, the Company entered into loan agreements with an investor in the principal amount of $45,000. This loan bears an interest rate of 6% and were due and payable on the second anniversary of the date of issuance of the loan.


As of March 31, 2020, these loans had outstanding principal and accrued interest of $188,924 and $61,637, respectively and $143,924 of the loans were on default. As of March 31, 2019, these loans were in default and had outstanding principal and accrued interest of $143,924 and $46,463, respectively.


During the years ended March 31, 2020 and 2019, the Company recorded interest expense of $15,174 and $14,592, respectively, on these loans.


XML 21 R11.htm IDEA: XBRL DOCUMENT v3.20.4
Convertible Notes Payable
12 Months Ended
Mar. 31, 2020
Convertible Notes Payable [Abstract]  
CONVERTIBLE NOTES PAYABLE

NOTE 5 – CONVERTIBLE NOTES PAYABLE


At March 31, 2020 and 2019, convertible notes consisted of the following:


   March 31, 
   2020   2019 
Principal amount  $480,740   $480,740 
Convertible notes payable  $480,740   $480,740 

Fiscal 2015 Financing


In October and November 2014, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2015 Agreements”) for the sale of the Company’s convertible notes. Pursuant to the Fiscal 2015 Agreements, the Company issued to these purchasers, convertible promissory notes (the “Fiscal 2015 Convertible Notes”) for an aggregate principal amount of $400,000 with the Company receiving proceeds equal to the principal amount. The Fiscal 2015 Convertible Notes bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through October and November 2017. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2015 Convertible Notes, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.02 During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. During the year ended March 31, 2016, the purchasers converted $130,510 and $10,792 of outstanding principal and accrued interest, respectively, into 7,065,084 shares of the Company’s common stock. As of March 31, 2019, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $122,167, respectively. As of March 31, 2020, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $149,565, respectively.


Fiscal 2016 Financing


In May and June 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements I”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes I bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through May and June 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes I, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes I shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $45,053, respectively. As of March 31, 2020, the Fiscal 2016 Notes I were in default and had outstanding principal and accrued interest of $115,000 and $56,744, respectively.


During August through September 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements II”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the “Fiscal 2016 Notes II”) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants II”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes II bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through August through September 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes II, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes II shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2019, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $34,478, respectively. As of March 31, 2020, the Fiscal 2016 Notes II were in default and had outstanding principal and accrued interest of $96,250 and $44,264, respectively.


During the year ended March 31, 2020 and 2019, the Company recorded interest expense of $64,049 and $63,334, respectively, on these convertible notes.


Derivative Liabilities Pursuant to Notes and Warrants


In connection with the issuance of the Notes and Warrants, the Company determined that the terms of the Notes and Warrants contain terms that included a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception and included various other terms such as default provisions that caused derivative treatment. Accordingly, under the provisions of ASC 815-40 –Derivatives and Hedging – Contracts in an Entity’s Own Stock, the embedded conversion option contained in the convertible instruments and the Warrants were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives and warrant derivatives were determined using the Binomial valuation model. At the end of each period, on the date that debt was converted into common shares, and on the date of a cashless exercise of warrants, the Company revalued the embedded conversion option and warrants derivative liabilities.


In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability recorded.


At March 31, 2019, the Company revalued the conversion option and warrant derivative liabilities. In connection with this revaluation, the Company recorded gain from change on fair value of derivative liabilities of $3,148 for the year ended March 31, 2019.


At March 31, 2019, the fair value of the derivative liabilities was estimated using the Binomial option-pricing model with the following assumptions:


   2019 
Dividend rate  —% 
Term (in years)  0.1 to 1.5 years 
Volatility  159% to 219% 
Risk—free interest rate  2.40%

For the years ended March 31, 2020 and 2019, amortization of debt discounts related to the convertible notes amounted to $0 and $21,649, respectively, which has been included in interest expense on the accompanying statements of operations.


XML 22 R12.htm IDEA: XBRL DOCUMENT v3.20.4
Stockholders' Deficit
12 Months Ended
Mar. 31, 2020
Stockholders' Equity Note [Abstract]  
STOCKHOLDERS’ DEFICIT

NOTE 6 – STOCKHOLDERS’ DEFICIT


Authorized shares


The Company is authorized to issue 200,000,000 consisting of 190,000,000 shares of common stock at $0.001 per share par value, and 10,000,000 shares of preferred stock at $0.001 per share par value.


Preferred Stock


As of March 31, 2020 and 2019, the Company did not have any preferred stock issued and outstanding.


Common Stock


As of March 31, 2020 and 2019, the Company had 62,570,659 shares of common stock issued and outstanding.


Warrants


Warrants issued pursuant to equity subscription agreements


During fiscal years 2013 to 2015, in connection with the sale of common stock, the Company issued an aggregate of 1,048,315 five-year warrants to purchase common shares for an exercise price of $0.40 per common share to investors pursuant to unit subscription agreements. These warrants were accounted for as equity. As of March 31, 2019, 314,706 warrants were issued and outstanding. During the year ended March 31, 2020, all of the 314,706 warrants expired. As of March 31, 2020, there were no warrants issued and outstanding.


Warrants issued in connection with the Fiscal 2016 Financing


During fiscal years 2016, pursuant to the convertible note agreements under the fiscal 2016 financing discussed in Note 5, the Company issued five-year warrants to purchase an aggregate of 4,225,000 (twenty warrants for each dollar of the principal amount) shares of the Company’s common stock at an exercise price of $0.07. The exercise price of these warrants shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price and were accounted for as derivative liabilities. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2020 and 2019, 4,225,000 warrants were issued and outstanding.


Warrant activity for the years ended March 31, 2020 and 2019 are summarized as follows


   Number of
Warrants
   Weighted
Average
Exercise Price
   Weighted
Average
Remaining
Contractual
Term (Years)
   Aggregate
Intrinsic Value
 
Balance Outstanding at March 31, 2018   4,554,707   $0.04    2.2   $ 
Expired   (15,001)  $0.40       $ 
Balance Outstanding at March 31, 2019   4,539,706   $0.04    1.2   $ 
Expired   (314,706)  $0.40       $ 
Balance Outstanding at March 31, 2020   4,225,000   $0.01    0.3   $ 
Exercisable at March 31, 2020   4,225,000   $0.01    0.3   $ 

XML 23 R13.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes
12 Months Ended
Mar. 31, 2020
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE 7 – INCOME TAXES


The Company maintains deferred tax assets and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets at March 31, 2020 and 2019 consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the uncertainty of the attainment of future taxable income.


The items accounting for the difference between income taxes at the effective statutory rate and the provision for income taxes for the years ended March 31, 2020 and 2019 were as follows:


   Years Ended March 31, 
   2020   2019 
Income tax benefit at U.S. statutory rate of 21%  $(31,991)  $(29,969)
Income tax benefit - State   (7,617)   (7,136)
Non-deductible expenses   605    4,147 
Change in valuation allowance   39,003    32,958 
Total provision for income tax  $   $ 

The Company’s approximate net deferred tax asset at March 31, 2020 and 2019 was as follows:


   Years Ended March 31, 
Deferred Tax Asset:  2020   2019 
Net operating losses  $1,076,355   $1,037,352 
Valuation allowance   (1,076,355)   (1,037,352)
Net deferred tax asset  $   $ 

The net operating loss carryforward was $4,139,824 and $3,989,814 at March 31, 2020 and 2019, respectively. The Company provided a valuation allowance equal to the deferred income tax asset for the years ended March 31, 2020 and 2019 because it was not known whether future taxable income will be sufficient to utilize the loss carryforward. The change in the allowance was $39,003 and $32,958 for the years ended March 31, 2020 and 2019, respectively.


These net operating loss carryforwards may be available to reduce future years’ taxable income. The potential tax benefit arising from the loss carryforward of $967,537 will expire through 2037. The potential tax benefit arising from the net operating loss carryforward of $108,818 from the period following to the Act’s effective date can be carried forward indefinitely within the annual usage limitations.


Additionally, the future utilization of the net operating loss carryforward to offset future taxable income may be subject to an annual limitation as a result of ownership changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforward that expires prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance.


The Company does not have any uncertain tax positions or events leading to uncertainty in a tax position. The Company’s Corporate Income Tax Returns from 2017 through 2020 are subject to Internal Revenue Service examination.


XML 24 R14.htm IDEA: XBRL DOCUMENT v3.20.4
Subsequent Events
12 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

NOTE 8 – SUBSEQUENT EVENTS


In June 2020, the Company entered into loan agreements with an investor in the aggregate principal amount of $46,000. The loans bear interest rate of 6% and were due and payable two-years from the date of issuances.


XML 25 R15.htm IDEA: XBRL DOCUMENT v3.20.4
Accounting Policies, by Policy (Policies)
12 Months Ended
Mar. 31, 2020
Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation


The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”).

Going Concern

Going Concern


The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,336 for the year ended March 31, 2020. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,712,994, $1,467,848 and $1,422,848, respectively, at March 31, 2020. The Company had no revenues for the year ended March 31, 2020. The Company’s loans payable in the aggregate amount of $143,924 and $480,470 of convertible notes are currently in default. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report.


Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future.


 Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Use of Estimates

Use of Estimates


The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2020 and 2019 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities.

Fair Value of Financial Instruments and Fair Value Measurements

Fair Value of Financial Instruments and Fair Value Measurements


FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2020. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).


The three levels of the fair value hierarchy are as follows:


  Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
   
  Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
   
  Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments.


Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2020 and 2019:


   At March 31, 2020   At March 31, 2019 
Description  Level 1   Level 2   Level 3   Level 1   Level 2   Level 3 
Derivative liabilities          $           $2,326 

A roll forward of the level 3 valuation financial instruments is as follows:


   For the Year Ended March 31, 
   2020   2019 
Balance at beginning of year  $2,326   $5,474 
Gain from change in fair value of derivative liabilities       (3,148)
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11   (2,326)    
Balance at end of year  $   $2,326 

ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments.

Cash

Cash


The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2020 and 2019. The Company has not experienced any losses in such accounts through March 31, 2020.

Derivative Liabilities

Derivative Liabilities


The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.


In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was adopted as of April 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the balance sheet as of June 30, 2019, the period which the amendment is effective. The Company adopted ASU No. 2017-11 in the period ended June 30, 2019, and the adoption resulted in a cumulative-effect adjustment of $2,326 on its financial statements and at March 31, 2020, there was no derivative liability.

Revenue Recognition

Revenue Recognition


In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The Company adopted ASU 2014-09 during the three months ended March 31 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2020 and 2019.

Stock-Based Compensation

Stock-Based Compensation


Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.


In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the three months ended June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements.


Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU No. 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. The Company early adopted ASU No. 2018-07 during the three months ended March 31, 2018. The adoption ASU No. 2018-07 did not have a material impact on the Company’s financial statements.

Income Taxes

Income Taxes


The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.


The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of March 31, 2020, and 2019, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. However, no such interest and penalties were recorded as of March 31, 2020.

Basic and Diluted Loss Per Share

Basic and Diluted Loss Per Share


Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2020 and 2019 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:


   March 31, 
   2020   2019 
Stock warrants   4,225,000    4,539,706 
Convertible notes   73,131,346    68,243,823 
Total   77,356,346    72,783,529 
Related Parties

Related Parties


Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.

Recent Accounting Pronouncements

Recent Accounting Pronouncements


Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements.

XML 26 R16.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies (Tables)
12 Months Ended
Mar. 31, 2020
Accounting Policies [Abstract]  
Schedule of financial assets and liabilities categorized as Level 3
   At March 31, 2020   At March 31, 2019 
Description  Level 1   Level 2   Level 3   Level 1   Level 2   Level 3 
Derivative liabilities          $           $2,326 
Schedule of financial instruments
   For the Year Ended March 31, 
   2020   2019 
Balance at beginning of year  $2,326   $5,474 
Gain from change in fair value of derivative liabilities       (3,148)
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11   (2,326)    
Balance at end of year  $   $2,326 
Schedule of antidilutive securities excluded from the computation of dilutive loss per common share
   March 31, 
   2020   2019 
Stock warrants   4,225,000    4,539,706 
Convertible notes   73,131,346    68,243,823 
Total   77,356,346    72,783,529 
XML 27 R17.htm IDEA: XBRL DOCUMENT v3.20.4
Accrued Liabilities (Tables)
12 Months Ended
Mar. 31, 2020
Payables and Accruals [Abstract]  
Schedule of accrued liabilities
   March 31, 
   2020   2019 
Accrued interest  $312,210   $248,161 
Accrued professional fees   2,634    2,634 
Accrued payroll taxes   28,691    29,727 
Accrued executive and director compensation   332,173    272,173 
Total  $675,708   $552,695 
XML 28 R18.htm IDEA: XBRL DOCUMENT v3.20.4
Loans Payable (Tables)
12 Months Ended
Mar. 31, 2020
Debt Disclosure [Abstract]  
Schedule of loans payable
   March 31, 
   2020   2019 
Current loans payable  $143,924   $143,924 
Long-term loans payable   45,000     
Total  $188,924   $143,924 
XML 29 R19.htm IDEA: XBRL DOCUMENT v3.20.4
Convertible Notes Payable (Tables)
12 Months Ended
Mar. 31, 2020
Convertible Notes Payable [Abstract]  
Schedule of convertible debt
   March 31, 
   2020   2019 
Principal amount  $480,740   $480,740 
Convertible notes payable  $480,740   $480,740 
Schedule of fair value of the derivative liabilities
   2019 
Dividend rate  —% 
Term (in years)  0.1 to 1.5 years 
Volatility  159% to 219% 
Risk—free interest rate  2.40%
XML 30 R20.htm IDEA: XBRL DOCUMENT v3.20.4
Stockholders' Deficit (Tables)
12 Months Ended
Mar. 31, 2020
Stockholders' Equity Note [Abstract]  
Schedule of warrant activity
   Number of
Warrants
   Weighted
Average
Exercise Price
   Weighted
Average
Remaining
Contractual
Term (Years)
   Aggregate
Intrinsic Value
 
Balance Outstanding at March 31, 2018   4,554,707   $0.04    2.2   $ 
Expired   (15,001)  $0.40       $ 
Balance Outstanding at March 31, 2019   4,539,706   $0.04    1.2   $ 
Expired   (314,706)  $0.40       $ 
Balance Outstanding at March 31, 2020   4,225,000   $0.01    0.3   $ 
Exercisable at March 31, 2020   4,225,000   $0.01    0.3   $ 
XML 31 R21.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes (Tables)
12 Months Ended
Mar. 31, 2020
Income Tax Disclosure [Abstract]  
Schedule of effective statutory rate and the provision for income taxes
   Years Ended March 31, 
   2020   2019 
Income tax benefit at U.S. statutory rate of 21%  $(31,991)  $(29,969)
Income tax benefit - State   (7,617)   (7,136)
Non-deductible expenses   605    4,147 
Change in valuation allowance   39,003    32,958 
Total provision for income tax  $   $ 
Schedule of net deferred tax asset
   Years Ended March 31, 
Deferred Tax Asset:  2020   2019 
Net operating losses  $1,076,355   $1,037,352 
Valuation allowance   (1,076,355)   (1,037,352)
Net deferred tax asset  $   $ 
XML 32 R22.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies (Details) - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Accounting Policies [Abstract]    
Net loss $ (152,336)  
Accumulated deficit (10,712,994) $ (10,562,984)
Stockholders’ deficit 1,467,848  
Working capital deficit 1,422,848  
Loans payable 143,924 $ 143,924
Conversion of Stock, Amount Issued 480,470  
Derivative liability recorded $ 2,326  
XML 33 R23.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies (Details) - Schedule of financial assets and liabilities categorized as Level 3 - USD ($)
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2018
Level 1 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Derivative liabilities  
Level 2 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Derivative liabilities  
Level 3 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Derivative liabilities $ 2,326 $ 5,474
XML 34 R24.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies (Details) - Schedule of financial instruments - Level 3 [Member] - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Summary of Significant Accounting Policies (Details) - Schedule of financial instruments [Line Items]    
Balance at beginning of year $ 2,326 $ 5,474
Gain from change in fair value of derivative liabilities (3,148)
Cumulative effect adjustment of derivative liability related to adoption of ASU 2017-11 (2,326)
Balance at end of year $ 2,326
XML 35 R25.htm IDEA: XBRL DOCUMENT v3.20.4
Summary of Significant Accounting Policies (Details) - Schedule of antidilutive securities excluded from the computation of dilutive loss per common share - Warrant [Member] - shares
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Stock warrants 4,225,000 4,539,706
Convertible notes 73,131,346 68,243,823
Total 77,356,346 72,783,529
XML 36 R26.htm IDEA: XBRL DOCUMENT v3.20.4
Accrued Liabilities (Details) - Schedule of accrued liabilities - USD ($)
Mar. 31, 2020
Mar. 31, 2019
Schedule of accrued liabilities [Abstract]    
Accrued interest $ 312,210 $ 248,161
Accrued professional fees 2,634 2,634
Accrued payroll taxes 28,691 29,727
Accrued executive and director compensation 332,173 272,173
Total $ 675,708 $ 552,695
XML 37 R27.htm IDEA: XBRL DOCUMENT v3.20.4
Loans Payable (Details) - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
May 31, 2016
Mar. 31, 2016
Debt Disclosure [Abstract]        
Aggregate of principal amount $ 45,000   $ 11,155 $ 132,769
Interest rate, percentage 6.00%   10.00% 10.00%
Loan outstanding principal balance $ 188,924 $ 143,924    
Accrued interest 61,637 46,463    
Default loan 143,924      
Interest expense $ 15,174 $ 14,592    
XML 38 R28.htm IDEA: XBRL DOCUMENT v3.20.4
Loans Payable (Details) - Schedule of loans payable - USD ($)
Mar. 31, 2020
Mar. 31, 2019
Schedule of loans payable [Abstract]    
Current loans payable $ 143,924 $ 143,924
Long-term loans payable 45,000
Total $ 188,924 $ 143,924
XML 39 R29.htm IDEA: XBRL DOCUMENT v3.20.4
Convertible Notes Payable (Details) - USD ($)
1 Months Ended 2 Months Ended 3 Months Ended 12 Months Ended
Jun. 30, 2015
May 31, 2015
Sep. 30, 2018
Sep. 30, 2015
Jun. 30, 2019
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2016
Jun. 30, 2018
May 31, 2018
Nov. 30, 2017
Oct. 31, 2017
Dec. 31, 2016
Nov. 30, 2014
Oct. 31, 2014
Convertible Notes Payable (Details) [Line Items]                              
Principal amount of debt           $ 480,740 $ 480,740                
Outstanding principal amount               $ 130,510              
Accrued interest               $ 10,792              
Convertible notes converted to shares (in Shares)               7,065,084              
Interest expense           64,049 63,334                
Gain from change on fair value of derivative liabilities         $ 2,326   3,148                
Amortization of debt discounts           0 21,649                
Fiscal 2015 Convertible Notes [Member]                              
Convertible Notes Payable (Details) [Line Items]                              
Principal amount of debt                           $ 400,000 $ 400,000
Convertible note interest rate                     10.00% 10.00%      
Conversion share price (in Dollars per share)               $ 0.02              
Reduced conversion share price (in Dollars per share)               0.01              
Outstanding principal amount           269,490 269,490                
Accrued interest           149,565 122,167                
Fiscal 2016 Notes I [Member]                              
Convertible Notes Payable (Details) [Line Items]                              
Convertible note interest rate                 10.00% 10.00%          
Conversion share price (in Dollars per share)   $ 0.05                          
Reduced conversion share price (in Dollars per share)                         $ 0.01    
Outstanding principal amount           115,000 115,000                
Accrued interest           56,744 45,053                
Warrants term, description Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”). Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”).                          
Fiscal 2016 Notes II [Member]                              
Convertible Notes Payable (Details) [Line Items]                              
Conversion share price (in Dollars per share)     $ 0.05                        
Reduced conversion share price (in Dollars per share)               $ 0.01              
Outstanding principal amount           96,250 96,250                
Accrued interest           $ 44,264 $ 34,478                
Warrants term, description       Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the “Fiscal 2016 Notes II”) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants II”).                      
Interest rate percentage     10.00%                        
XML 40 R30.htm IDEA: XBRL DOCUMENT v3.20.4
Convertible Notes Payable (Details) - Schedule of convertible debt - USD ($)
Mar. 31, 2020
Mar. 31, 2019
Schedule of convertible debt [Abstract]    
Principal amount $ 480,740 $ 480,740
Convertible notes payable $ 480,740 $ 480,740
XML 41 R31.htm IDEA: XBRL DOCUMENT v3.20.4
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities
12 Months Ended
Mar. 31, 2019
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items]  
Dividend rate
Risk—free interest rate 2.40%
Minimum [Member]  
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items]  
Term (in years) 36 days
Volatility 159.00%
Maximum [Member]  
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items]  
Term (in years) 1 year 6 months
Volatility 219.00%
XML 42 R32.htm IDEA: XBRL DOCUMENT v3.20.4
Stockholders' Deficit (Details) - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2016
Stockholders' Deficit (Details) [Line Items]      
Common stock authorized to issue 200,000,000    
Common stock, shares authorized 190,000,000 190,000,000  
Common stock, par value (in Dollars per share) $ 0.001 $ 0.001  
Preferred stock, shares authorized 10,000,000 10,000,000  
Preferred stock, par value (in Dollars per share) $ 0.001 $ 0.001  
Common stock, shares issued 62,570,659 62,570,659  
Common stock, shares outstanding 62,570,659 62,570,659  
Warrants issued and outstanding   4,225,000  
Warrants [Member]      
Stockholders' Deficit (Details) [Line Items]      
Warrants issued and outstanding   314,706  
Warrants expired (in Dollars) $ 314,706    
Warrants [Member] | Fiscal years 2013 to 2015 [Member]      
Stockholders' Deficit (Details) [Line Items]      
Issuance of warrant (in Dollars) $ 1,048,315    
Warrants exercise price (in Dollars per share) $ 0.40    
Warrants [Member] | Convertible Note [Member]      
Stockholders' Deficit (Details) [Line Items]      
Warrants exercise price (in Dollars per share)     $ 0.07
Warrants issued and outstanding 4,225,000    
Issuance of warrant     4,225,000
Conversion price down (in Dollars per share)     $ 0.01
XML 43 R33.htm IDEA: XBRL DOCUMENT v3.20.4
Stockholders' Deficit (Details) - Schedule of warrant activity - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Schedule of warrant activity [Abstract]    
Number of Warrants, Beginning Balance 4,539,706 4,554,707
Weighted Average Exercise Price, Beginning Balance $ 0.04 $ 0.04
Weighted Average Remaining Contractual Term (Years), Beginning Balance   2 years 73 days
Aggregate Intrinsic Value, Beginning Balance
Number of Warrants, Ending Balance 4,225,000 4,539,706
Weighted Average Exercise Price, Ending Balance $ 0.01 $ 0.04
Weighted Average Remaining Contractual Term (Years), Ending Balance 109 days 1 year 73 days
Aggregate Intrinsic Value, Ending Balance
Number of Warrants, Exercisable 4,225,000  
Weighted Average Exercise Price, Exercisable $ 0.01  
Weighted Average Remaining Contractual Term (Years),Exercisable 109 days  
Aggregate Intrinsic Value, Exercisable  
Number of Warrants, Expired (314,706) (15,001)
Weighted Average Exercise Price, Expired $ 0.40 $ 0.40
Weighted Average Remaining Contractual Term (Years), Expired
Aggregate Intrinsic Value, Expired
XML 44 R34.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes (Details) - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Income Tax Disclosure [Abstract]    
Deferred tax asset net operating loss carryforward $ 4,139,824 $ 3,989,814
Change in allowance 39,003 $ 32,958
Potential tax benefit loss carryforward $ 967,537  
Potential tax benefit expired 2037 years  
Potential tax benefit net operating loss carryforward $ 108,818  
XML 45 R35.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes (Details) - Schedule of effective statutory rate and the provision for income taxes - USD ($)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Schedule of effective statutory rate and the provision for income taxes [Abstract]    
Income tax benefit at U.S. statutory rate of 21% $ (31,991) $ (29,969)
Income tax benefit - State (7,617) (7,136)
Non-deductible expenses 605 4,147
Change in valuation allowance 39,003 32,958
Total provision for income tax
XML 46 R36.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes (Details) - Schedule of effective statutory rate and the provision for income taxes (Parentheticals)
12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Schedule of effective statutory rate and the provision for income taxes [Abstract]    
Income tax benefit at U.S. statutory rate 21.00%
XML 47 R37.htm IDEA: XBRL DOCUMENT v3.20.4
Income Taxes (Details) - Schedule of net deferred tax asset - USD ($)
Mar. 31, 2020
Mar. 31, 2019
Schedule of net deferred tax asset [Abstract]    
Net operating losses $ 1,076,355 $ 1,037,352
Valuation allowance (1,076,355) (1,037,352)
Net deferred tax asset
XML 48 R38.htm IDEA: XBRL DOCUMENT v3.20.4
Subsequent Events (Details) - Subsequent Event [Member]
1 Months Ended
Jun. 30, 2020
USD ($)
Subsequent Events (Details) [Line Items]  
Aggregate principal amount $ 46,000
Bear interest rate 6.00%
Due and payable term 2 years
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