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Stockholders' Equity
6 Months Ended
Sep. 30, 2018
Equity [Abstract]  
STOCKHOLDERS' EQUITY

NOTE 4 — STOCKHOLDERS’ EQUITY

 

Preferred stock

 

The Company is authorized to issue 10,000,000 shares of $0.0001 par value preferred stock. As of September 30, 2018 and March 31, 2018, the Company has 1,009,539 and 716,939 shares of preferred stock issued and outstanding, respectively.

 

Series A Convertible Redeemable Preferred Stock

 

On October 24, 2017, the Company filed a Certificate of Designations (a “COD”) with the Delaware Secretary of State designating 700,000 shares of the Company’s authorized preferred stock as Series A Convertible Preferred Stock (the “Series A”), which converts into 200 shares of common stock per share of Series A, subject to adjustment in the event of stock splits, stock dividends or reverse splits and issuances of securities at prices below the prevailing conversion price of the Series A. During the year ended March 31, 2018, the Company entered into Securities Purchase Agreements (each a “SPA”) with the two Investors who converted their Notes into Series C Convertible Preferred Stock (the “Series C”) and Series C-1 Convertible Preferred Stock (the “Series C-1”). Pursuant to the SPAs, the Investors paid the Company a total of $600,000 and purchased in the aggregate 600,000 of shares of Series A and Warrants to purchase 120,000,000 shares of the Company’s common stock.

  

Dividends accrue on the Series A at a rate of 10% per annum. Holders of Series A are entitled to vote together with holders of the common stock on an as-converted basis, subject to a beneficial ownership limitation of 4.99%. The Series A is redeemable in the same manner as the Series C and C-1, defined below. The Series A is senior to all other preferred stock, except the Company’s Series A-1 Convertible Preferred Stock (the “Series A-1”) and the common stock upon liquidation of the Company. The Warrants have a five year term and an exercise price of $0.01 per share, subject to adjustment in the event of stock splits, stock dividends or reverse splits and issuances of securities at prices below the prevailing exercise price of the Warrants.

 

Series A-1 Convertible Redeemable Preferred Stock

 

On May 25, 2018, the Company filed a COD authorizing 600,000 shares of the Company’s preferred stock as the Series A-1. The Series A-1 converts into 200 shares of common stock per share of Series A-1, subject to adjustment in the event of stock splits, stock dividends or reverse splits, and issuances of securities at prices below the prevailing conversion price of the Series A-1. Dividends accrue on the Series A-1 at a rate of 10% per annum. Holders of Series A-1 are entitled to vote together with holders of the common stock on an as-converted basis, subject to a beneficial ownership limitation of 4.99%. The Series A-1 is redeemable upon the occurrence of certain triggering events.

 

On June 1, 2018, the Company entered into SPAs with the Investors. Pursuant to the SPA, the Investors purchased a total of 300,000 of shares of Series A-1 and Warrants to purchase 60,000,000 shares of the Company’s common stock in exchange for a total of $300,000.

 

The Investors agreed to waive the Series A, Series C and Series C-1 conversion price adjustments as they relate to the sale of the Series A-1 preferred stock.

 

The Warrants have a five year term and an exercise price of $0.01 per share, subject to adjustment in the event of stock splits, stock dividends or reverse splits and issuances of securities at prices below the prevailing exercise price of the Warrants.

 

Series B Convertible Preferred Stock

 

On October 24, 2017, the Company filed a COD with the Delaware Secretary of State designating 1,875,000 shares of the Company’s authorized preferred stock as Series B which converts into 200 shares of common stock per share of Series B, subject to adjustments in the event of stock splits, stock dividends and reverse splits. Recruiter will receive 625,000 shares of Series B upon the launch of a functional software platform and receipt of $10,000 in sales revenue. Recruiter is entitled to receive up to an additional 1,250,000 shares of Series B following the achievement of certain milestones as provided for in the License.

 

Series C and Series C-1 Convertible Redeemable Preferred Stock

  

On October 24, 2017, the Company filed a COD with the Delaware Secretary of State designating 102,100 shares of the Company’s authorized preferred stock as Series C which converts into 1,000 shares of common stock per share of Series C, subject to adjustments in the event of stock splits, stock dividends and reverse splits and issuances of securities at prices below the prevailing conversion price of the Series C. In accordance with the terms of the License, on October 30, 2017 holders of the Company’s outstanding 4% Convertible Notes converted their 4% Convertible Notes and accrued interest into 102,099,752 shares of Series C.

 

Also on October 24, 2017, the Company filed a COD with the Delaware Secretary of State designating 18,839 shares of the Company’s authorized preferred stock as Series C-1 which converts into 1,000 shares of common stock per share of Series C-1, subject to adjustments in the event of stock splits, stock dividends and reverse splits and issuances of securities at prices below the prevailing conversion price of the Series C-1. In accordance with the terms of the License, on October 30, 2017 holders of the Company’s 10% Convertible Notes converted their 10% Convertible Notes and accrued interest into 18,839 shares of Series C-1.

 

Holders of shares of Series C and Series C-1 may cause the Company to redeem in cash the outstanding shares of Series C and C-1 beginning on October 30, 2019, and earlier than that date upon the occurrence of certain triggering events contained in the COD for the Series C and Series C-1, at a redemption price based upon a formula contained in the COD for each series. Subject to the prior conversion, the total redemption price if redeemed after two years from issuance is equal to the amount of the principal and accrued interest on the 4% Convertible Notes and 10% Convertible Notes due as of the closing date plus potential additional amounts.

 

During February 2018, the Company filed an amendment to the Certificates of Designations for the Series C and Series C-1 extending the redemption date to October 2022 and reducing the redemption amount of the preferred shares then outstanding at a redemption price equal to one-half of the Conversion Amount (as defined) of such preferred shares. During the three and six months ended September 30, 2018 we recorded a credit to additional paid in capital of $24,777 and $50,479, respectively, as a result of the reduction in the redemption amount. During the year ended March 31, 2018 we recorded a credit to additional paid in capital of $1,071,932 as a result of the reduction in the redemption amount.

 

On February 1, 2018, the Company issued 4,000,000 shares of common stock upon the conversion of 4,000 shares of Series C.

 

During the three months ended September 30, 2018, the Company issued 7,400,000 shares of common stock upon the conversion of 7,400 shares of Series C.

 

Common stock

 

The Company is authorized to issue 250,000,000 shares of common stock, par value $0.0001 per share. As of September 30, 2018 and March 31, 2018 the Company had 138,954,197 and 131,554,197 shares of common stock outstanding, respectively. 

 

On June 21, 2018, pursuant to shareholder approval, the shareholders approved a reverse stock split in the range of one-for-50 to one-for-100 or any amount in between and a reduction of its authorized common stock in order to save annual fees in Delaware. The reverse stock split has not yet been implemented.

  

Common stock options

 

During the six months ended September 30, 2018 the Company granted to various advisors an aggregate of 1,200,000 options to purchase common stock, exercisable at $0.06 per share, under the terms of the 2017 Equity Incentive Plan. The options have a term of five years. The options vest on various dates in the three months ending March 31, 2019.

 

Common stock warrants

 

In connection with the sale of our Series A-1 preferred stock, we issued an aggregate of 60,000,000 common stock purchase warrants to the Investors. The warrants are exercisable any time on or after 90 days after the issuance date at an exercise price of $0.01 and expire, if unexercised, on September 1, 2023. The exercise price and number of warrants are subject to adjustment in the event of stock splits, stock dividends or reverse splits and issuances of securities at prices below the prevailing conversion price of the warrants.