v3.21.2

Derivative Liabilities

6 Months Ended

Jun. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Liabilities

NOTE 10 – DERIVATIVE LIABILITIES

The Company classified certain conversion features in the convertible notes and preferred stock issued as embedded derivative instruments due to the variable conversion price feature and potential adjustments to conversion prices due to events of default. These conversion features are recorded as derivative liabilities at fair value in the consolidated financial statements. These fair value estimates were measured using inputs classified as Level 3 of the fair value hierarchy. The Company develops unobservable Level 3 inputs using the best information available in the circumstances, which might include its own data, or when it believes inputs based on external data better reflect the data that market participants would use, its bases its inputs on comparison with similar entities. Due to the existence of down round provisions, which create a path-dependent nature of the conversion prices of the convertible notes, the Company decided a Lattice-Based Simulation model, which incorporates inputs classified as Level 3 was appropriate.

The following table present the assumptions used in Black-Scholes Simulation model to determine the fair value of the derivative liabilities as of June 30, 2020:

For the three months ended June 30, 2020:

Derivative Liabilities at March 31, 2020		$	15,737,346
Additional new conversion option derivatives		$	-
Conversion of note derivatives		$	(131,008	)
Change in fair value		$	(1,505,242	)
Derivative Liabilities at June 30, 2020			14,101,096

For the six months ended June 30, 2020:

Derivative Liabilities at December 31, 2019		$	5,359,442
Additional new conversion option derivatives		$	7,272
Conversion of note derivatives		$	(277,298	)
Change in fair value		$	9,011,680
Derivative Liabilities at June 30, 2020			14,101,096

During the three and six months ended June 30, 2020, the Company recorded new derivative liabilities of $0 and $7,272 related to the issuance of convertible notes payable and Series D-2 Preferred Stock and converted $131,008 and $277,298 in derivative liability to additional paid-in capital due to conversions of notes payable and Series D-2 Preferred Stock into common stock.

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- References

No definition available.

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- Definition

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-URI http://asc.fasb.org/topic&trid=2229140

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 50
-Paragraph 5
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123477628&loc=d3e90205-114008

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