Derivative Liabilities

3 Months Ended

Mar. 31, 2020

Note 6 – Derivative Liabilities

Certain of the Company’s convertible notes and warrants contain features that create derivative liabilities. The pricing model the Company uses for determining fair value of its derivatives is the Lattice Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income. The derivative components of these notes are valued at issuance, at conversion, at restructure, and at each period end.

Derivative liability activity for the year ended December 31, 2019 and the three months ended March 31, 2020 is summarized in the table below:

December 31, 2018	$	-
Conversion features issued		1,472,320
Warrants issued		187,968
Settled upon conversion or exercise		(689,469	)
Settled upon payment of note		(191,827	)
Loss on revaluation		709,431
December 31, 2019	$	1,488,423

Conversion features issued		411,433
Warrants issued		-
Settled upon payment of note		(231,323	)
Gain on revaluation		(496,369	)
March 31, 2020	$	1,172,164