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5. CONVERTIBLE DEBT SECURITIES

12 Months Ended

Dec. 31, 2018

NOTE 5 – CONVERTIBLE DEBT SECURITIES

The Company uses the Black-Scholes Model to calculate the derivative value of its convertible debt. The valuation result generated by this pricing model is necessarily driven by the value of the underlying common stock incorporated into the model. The values of the common stock used were based on the price at the date of issue of the debt security and December 31, 2018. Management determined the expected volatility range between 95.3 – 100.5%, a risk free rate of interest of 7.91%, and contractual lives of the debt varying from six months to two years. The table below details the Company's nine outstanding convertible notes, with totals for the face amount, amortization of discount, initial loss, change in the fair market value, and the derivative liability.

	Face		Amortization		Initial		Change			Derivative Balance
	Amount		of Discount		Loss		in FMV			12/31/2018
	$	189,750	$	86,817	$	58,959	$	(54,412	)	$	145,031
		201,000		88,110		74,429		(60,713	)		141,466
		97,000		70,114		11,381		(3,004	)		78,377
		100,000		35,531		8,904		(23,491	)		75,163
		103,000		38,280		5,651		(21,252	)		77,399
		247,500		54,480		–		(1,228	)		123,038
		29,250		1,053		–		(1,764	)		2,763
		49,726		1,790		–		(3,440	)		4,255
		41,774		1,502		–		(2,890	)		3,576
		29,250		1,053		–		(1,764	)		2,763
Subtotal		1,088,250		378,730		159,324		(173,958	)		653,831
Transaction expense		–		–		–		(51,250	)		–
	$	1,088,250	$	378,730	$	159,324	$	(225,208	)	$	653,831

On July 17, 2018, The Company entered into a securities purchase agreement with Carebourn Capital L.P., (“Carebourn”) issuing to Carebourn a convertible promissory note in the aggregate principal amount of $189,750 with a $24,750 original issue discount and $15,000 in transactional expenses due to Carebourn. The note bears interest at 12% per annum and may be converted into common shares of DPI's common stock at a conversion price equal to 60% of the average of the three lowest trading prices of the DPI's common stock during the 20 prior trading days. For the year ended December 31, 2018, the Company made repayments totaling $42,200. Subsequent to December 31, 2018, Carebourn converted $53,932 in principal of its' convertible note into 7,688,347 shares of common stock in addition to repayments totaling $10,150.

On July 27, 2018, The Company entered into a securities purchase agreement with Carebourn, issuing to Carebourn a convertible promissory note in the aggregate principal amount of $276,000 with a $36,000 original issue discount and $15,000 in transactional expenses due to Carebourn. The note bears interest at 12% per annum and may be converted into common shares of the Company's common stock at a conversion price equal to 60% of the average of the three lowest trading prices of the Company's common stock during the 20 prior trading days. As of the date the consolidated financial statements were available for issuance, DPI received $150,000 net cash, and $75,000 is due to be received.

On August 20, 2018, the Company entered into a securities purchase agreement with More Capital LLC, ("More") issuing to More a convertible promissory note in the aggregate principal amount of $152,000 with a $20,000 original issue discount and $7,000 in transactional expenses due to More. The note bears interest at 12% per annum and may be converted into common shares of the Company's common stock at a conversion price equal to 60% of the average of the three lowest trading prices of the Company's common stock during the 20 prior trading days. As of the date the consolidated financial statements were available for issuance, DPI received $70,000 net cash, and $55,000 is due to be received.

On September 24, 2018, the Company entered into a securities purchase agreement with Auctus Fund, LLC, (“Auctus”) issuing to Auctus a convertible promissory note in the aggregate principal amount of $100,000 with $10,250 in transactional expenses due to Auctus and its counsel. The note bears interest at 8% per annum and may be converted into common shares of the Company's common stock at a conversion price equal to 70% of the lowest trading price of the Company's common stock during the 20 prior trading days. As of November 30, 2018, the Company has been in breach of the note and default interest as of that date at the rate of 24% due to the failure to maintain the required amount of reserve shares. The Company received $89,750 net cash on September 27, 2018.

On September 25, 2018, the Company entered into a securities purchase agreement with EMA Financial, LLC, (“EMA”) issuing to EMA a convertible promissory note in the aggregate principal amount of $100,000 with a 6% original issue discount and $4,000 in transactional expenses due to EMA. The note bears interest at 8% per annum and may be converted into common shares of the Company's common stock at a conversion price equal to the lower of current market price, $0.25, or 70% of the lowest trading price of the Company's common stock during the 20 prior trading days. The Company received $90,000 net cash on September 28, 2018.

On September 24, 2018, the Company entered into a securities purchase agreement with FirstFire Global Opportunities Fund LLC, (“FirstFire”) issuing to FirstFire a convertible promissory note in the aggregate principal amount of $247,500, with a $22,500 original issue discount and $5,000 in transactional expenses due to FirstFire's counsel. The note bears interest at 8% per annum and may be converted into common shares of the Company's common stock at a conversion price equal to the lower of $0.25, or 70% of the lowest trading price of the Company's common stock during the 20 prior trading days. The Company received $220,000 net cash on October 9, 2018.

As of December 31, 2018 and 2017 respectively, there was $601,250 and $0 of convertible debt outstanding, net of debt discount of $440,800, and $0, As of December 31, 2018 and 2017 respectively, there was derivative liability of $653,831 and $0 related to convertible debt securities.