CONVERTIBLE NOTE PAYABLE

3 Months Ended

Mar. 31, 2019

Convertible Notes Payable [Abstract]

Convertible Notes Payable [Text Block]

NOTE 4 – CONVERTIBLE NOTE PAYABLE

On January 22, 2019, the Company executed a converted promissory note with Redstart Holdings Corp. (“Redstart”) for $103,000. The note is unsecured, bears interest at 10% per annum and matures on January 22, 2020. The note is convertible, after 180 days, into shares of common stock at the rate of 61% (39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion. The Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $379,120 based on the Black Scholes Merton pricing model and a corresponding debt discount of $103,000 to be amortized utilizing the interest method of accretion over the term of the note. As of March 31, 2019, the Company fair valued the derivative at $181,967. In addition, $19,471 of the debt discount has been amortized to interest expense.

A summary of the activity of the derivative liability for the notes above is as follows:

Balance at December 31, 2018	$	-
Increase to derivative due to new issuances		379,120
Derivative gain due to mark to market adjustment		(197,153	)
Balance at March 31, 2019	$	181,967

A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liability that are categorized within Level 3 of the fair value hierarchy for the three months ended March 31, 2019 is as follows:

Inputs	March 31, 2019			Initial Valuation
Stock price	$	0.0400		$	0.0406
Conversion price	$	0.0203		$	0.0105
Volatility (annual)		316.98	%		318.13	%
Risk-free rate		2.60	%		2.59	%
Years to maturity		.81			1

The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management