NOTE 16 - SUBSEQUENT EVENTS

The Company has evaluated subsequent events from the condensed consolidated balance sheet date through November 23, 2020 (the condensed consolidated financial statement issuance date) and noted the following disclosures:

On October 6, 2020, the Company put 300,000 common shares at $0.043 under the Equity Purchase Agreement and received $12,673 in net proceeds.

On October 20, 2020, the Company put 300,000 common shares at $0.0399 under the Equity Purchase Agreement and received $11,722 in net proceeds.

The Company is currently negotiating a further extension of the maturity of the 8% Senior Secured Convertible Promissory Notes, since the Company does not believe it will be able to repay the outstanding principal balance and accrued interest by the extended maturity date of November 28, 2020.

Reverse Stock Split

Effective October 8, 2020, the Company’s majority stockholder approved a 1-for-15 reverse common stock split (“the reverse stock split”). The Company intends to effectuate the reverse stock split as soon as practicable, however, the transaction is subject to approval from the Financial Industry Regulatory Authority (FINRA). Since the Company cannot guaranty FINRA’s approval, management believes that the transaction has not occurred and has presented the financial information in this 10Q as if the transaction has not occurred.

If the Company receives FINRA’s approval and the reverse stock split is completed, it will reduce the number of common shares outstanding at September 30, 2020 from 83,135,586 to 5,542,372. As a result of the reverse stock split, every 15 shares of issued and outstanding common stock will be combined into one issued and outstanding share of common stock, without any change in the par value per share or the number of authorized common shares. As well, the number of outstanding common stock warrants will be reduced by a factor of 15 and exercise price increased by a factor of 15 concurrently. By contract, the terms of the Series A and Series B Convertible Preferred Stock will not change.

The following is the impact of the 1 for 15 reverse stock split in the presentation of the three and nine months ended September 30, 2020 and 2019 basic and diluted loss per share:

		Three Months Ended September 30,						Nine Months Ended September 30,
		2020			2019			2020			2019

Net Loss Available to Common Stockholders	$	(210,318	)	$	(168,466	)	$	(1,017,155	)	$	(1,775,898	)
Series A Preferred Stock Dividends		2,500			2,500			7,500			7,500
Net Loss Available to Common Stockholders and Assumed Conversions	$	(212,818	)	$	(170,966	)	$	(1,024,655	)	$	(1,783,398	)

Weighted-Average Shares - Basic		5,443,858			4,811,795			5,210,618			4,721,318
Shares Issuable Upon Conversion of 8% Senior Secured Convertible Promissory Notes		—			—			—			—
Shares Issuable Upon Conversion of Preferred Stock — Series A		—			—			—			—
Shares Issuable Upon Conversion of Preferred Stock — Series B		—			—			—			—
Weighted-Average Shares - Diluted		5,443,858			4,811,795			5,210,618			4,721,318
Net Loss Per Common Share:
Basic	$	(0.04	)	$	(0.04	)	$	(0.20	)	$	(0.38	)
Diluted	$	(0.04	)	$	(0.04	)	$	(0.20	)	$	(0.38	)