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Preferred and Common Stock
12 Months Ended
Dec. 31, 2019
Notes  
Preferred and Common Stock

 

NOTE 5 - PREFERRED STOCK

 

On October 19, 2011, the Company filed Articles of Incorporation with the State of Utah so as to authorize 10,000,000 shares of preferred stock having a par value of $0.001 per share. No preferred shares are issued or outstanding at December 31, 2019.

 

NOTE 6 - COMMON STOCK

 

Common Stock Issued for Cash and Subscription Payable:

 

In May 2018, the Company entered into three stock subscriptions agreements with two investors.  The subscriptions gave the investors the right to purchase up to 440,000 shares of restricted common stock at $0.25 per share.  The Company received $110,000 under these subscription agreements and issued the 440,000 shares of restricted stock in June to fully satisfy its obligations under the agreements.   

 

In October and December 2018, the Company entered into four stock purchase agreements under which the buyer may purchase up to $10,000, $15,000, $20,000, and $50,000, respectively, in shares of common stock at $0.25 per share.  During 2018 the buyers the buyers exercised their rights and purchased 380,000 shares of stock under those agreements for $95,000.  The Company issued 340,000 shares of restricted common stock in 2018 and the remaining 40,000 shares 2019.

 

In 2019 the Company issued 200,000 shares of restricted common stock for $50,000 to an unrelated investor.  Also during 2019 the Company received $367,866 in proceeds from a related party (a significant shareholder and convertible note holder), pursuant to a stock purchase agreement, which is convertible at $0.25per share. 

 

At December 31, 2019 and 2018, the Company had $465,541 and $849,175, respectively, in stock subscriptions payable for which it is obligated to issue 1,862,164 and 3,392,950 shares of restricted common stock, respectively.  Additionally, as of December 31, 2019, an agreement for a purchase of a total of 516,256 shares of common stock for $129,064 are open to be subscribed to by the related party.

 

Common Stock Issued to Officer:

 

In February 14, 2018 the Company announced that the consulting agreement with the Chief Financial Officer (Mr. Merrell) was terminated effective December 31, 2017, and that a new agreement was entered into effective January 1, 2018 under which Mr. Merrell would receive 2,000,000 shares of restricted common stock, vesting at 500,000 shares per year, for his service.  The term of the agreement is for one year, which term automatically renews for one-year extensions up to four years unless terminated by either party with 30 days written notice.  The Company issued all 2,000,000 shares to Mr. Merrell on August 20, 2018.  Any common shares not earned during the four-year period are to be returned or cancelled.  An expense of $200,000 was recorded for the year ended December 31, 2019, which represents the fair value of the stock vested. A charge will be made each quarter as the shares are earned under the provisions of the agreement until such time as all shares have been earned.

 

Common Stock Issued for Services:

 

In September 2018, the Company issued 650,000 shares of stock to two consultants.  Of these shares, 150,000 were issued under a consulting contract for services rendered and vested upon issue and 500,000 shares of restricted stock were issued to a consultant for services rendered and to be rendered through June 1, 2019.  The common stock was valued at $639,000, of which $432,863 was recorded during the year ended December 31, 2018.  A prepaid expense for the remaining balance of $206,250 is recorded and will be amortized over the term of the consulting agreement.