CONVERTIBLE DEBT (Tables)

3 Months Ended

Mar. 31, 2021

Debt Instrument Redemption [Table Text Block]

The key terms of the Series A and Series 2023 Notes, as amended, are highlighted in the table below:

Key Terms	Series 2023 Notes	Series A Notes
Inception Date	08/01/2013	11/03/2014
Cash Received	$10,500,000	$12,500,000
Principal (Initial Liability)	$10,500,000	$19,848,486
Maturity (Term)	Matures on August 1, 2023, but convertible into shares of the Company’s common stock at the discretion of the holder or by the Company based on the market price of the Company’s stock;	Matures on May 1, 2023 but extends to August 1, 2023 if the Series 2023 Notes are still outstanding. Convertible into shares of the Company’s common stock at the discretion of the holder or by the Company based on the market price of the Company’s stock;
Exercise Price	$0.57, adjusted downward based on anti-dilution provisions/down-round protection	$0.37, adjusted downward based on anti-dilution provisions/down-round protection;
Stated Interest	10% per annum through December 14, 2017, 3% per annum thereafter, due semi-annually;	10% per annum through December 14, 2017, 3% per annum thereafter, due semi-annually;
Derivative Liability	$2,055,000 established at inception due to the existence of down-round protection; revalued every quarter using Monte Carlo model.	$9,212,285 established at inception due to existence of down-round protection; revalued every quarter using a Monte Carlo model.

In April 2019 the Company entered into a settlement agreement with the holders of the Series A Notes and Series 2023 Notes (the “PIK Notes”). Per the terms of the agreement the Company will pay to holders of PIK Notes on a pro rata basis the following percentages of revenue booked during a fiscal quarter: (a) three percent (3%) of gross revenues if cash or cash equivalents on the Company’s balance sheet or otherwise is less than $3 million on the last day of the fiscal quarter; or (b) five percent (5%) of gross revenues if cash or cash equivalents on the Company’s balance sheet or otherwise is greater than $3 million but less than $5 million the last day of the fiscal quarter; or (c) twelve percent (12%) of gross revenues if cash or cash equivalents on the Company’s balance sheet or otherwise is greater than $5 million.

Convertible Debt [Table Text Block]

As of March 31, 2021, the liability components of the PIK Notes on the Company’s balance sheet are listed in the following table:

	Series 2023 Notes		Series A Notes			Total
PIK Note Payable, Gross	$	17,509,741	$	29,209,832		$	46,719,573
Less: Discount		-		(984,487	)		(984,487	)
PIK Note Payable, Net	$	17,509,741	$	28,225,345		$	45,735,086

As of December 31, 2020, the liability components of the PIK Notes on the Company’s balance sheet are listed in the following table:

	Series 2023 Notes		Series A Notes			Total
PIK Note Payable, Gross	$	17,249,430	$	29,069,548		$	46,318978
Less: Discount		-		(1,082,988	)		(1,082,988	)
PIK Note Payable, Net	$	17,249,430	$	27,986,560		$	42,235,990