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Subsequent Events
3 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events

Note 16 - Subsequent Events

 

Management has evaluated events that occurred subsequent to the end of the reporting period shown herein:

 

Subsequent to March 31, 2020, the Company issued 14,873,256 shares of common stock for the conversion of $115,000 of convertible notes payable.

 

On April 11, 2020, Douglas Davis resigned as Chief Executive Officer of the Company so that he may fully devote all of his efforts to GBT Tokenize Corp., the Company’s joint venture, which intends to develop a new product. Mr. Davis’ resignation was not the result of any disagreements with management or board of directors of the Company.

 

The Board of Directors of the Company approved, on April 13, 2020, a reverse stock split of all of the Company’s Common Stock, pursuant to which every 50 shares of Common Stock of the Company shall be reverse split, reconstituted and converted into one (1) share of Common Stock of the Company (the “Reverse Stock Split”). The Company submitted an Issuer Company Related Action Notification regarding the Reverse Stock Split to FINRA on April 14, 2020.  To effectuate the Reverse Stock Split, the Company filed on April 21, 2020 a Certificate of Change Pursuant to Nevada Revised Statutes (“NRS”) Section 78.209 (the “Certificate of Change”) with the Secretary of State of the State of Nevada subject to FINRA approval. Since this reverse stock split has not yet been approved by the State of Nevada, the financial statements have not been retroactively restated to reflect this reverse stock split. On June 8, 2020 FINRA advised the Company that such request is deficient due to the fact that a holder of an outstanding convertible note of the Company had entered into two settlements with the Securities and Exchange Commission that related to securities laws violations but were in no way related to the Company. As a result, FINRA advised that it is necessary for the protection of investors, the public interest, and to maintain fair and orderly markets that documentation related to the Reverse Stock Split not be processed. The Company appealed the decision made by FINRA on June 15, 2020.

  

On April 13, 2020, the Company’s Board of Directors appointed Mansour Khatib, who has served as the Chief Marketing Officer and a director of the Company as Chief Executive Officer. Mr. Khatib has also previously served as Interim Chief Executive Officer from May 2018 to July 2018.

 

On June 17, 2020 the Company was approved for a long term loan of $150,000 by SBA - Economic Injury Disaster Loan. The loan was funded on June 22, 2020. Installment payments, including monthly principal and interest of $731.00, will begin Twelve (12) months from the date of the promissory Note. The balance of principal and interest will be payable Thirty (30) years from the date of the promissory Note. Interest will accrue at the rate of 3.75% per annum.

 

On September 27, 2019, Surge Holdings, Inc. (“SURG”) issued a Convertible Promissory Note issued by SURG in the principal amount of $4,000,000 (the “SURG Note”), which was assigned to AltCorp Trading LLC., a subsidiary of the Company (“AltCorp”). On June 23, 2020, AltCorp and SURG entered into an Exchange Agreement whereby AltCorp exchanged $2,750,000 of the SURG Note for 5,500,000 shares of SURG’s common stock. On June 23, 2020, SURG, AltCorp and Glen Eagles Acquisition LP (“Glen”) entered into an Exchange and Assignment Agreement pursuant to which $1,250,000 of the SURG Note was converted into 2,500,000 shares of common stock of SURG and assigned to Glen.

 

On or about June 23, 2020 Stanley which holds a pledge of 3,333,333 shares of SURG common stock (See Note 8) via its manager/member (“Stanley’s Member”) entered into an agreement with SURG, its transfer agent and an escrow officer for which Stanley’s Member agreed that 3,333,333 SURG shares will be cancelled for consideration of up to $700,000. The amount of $500,000 was paid on June 23, 2020 into a lawyer’s trust account, and 2,380,952 of SURG shares have been sent for cancelation. The remaining shares may be sent to cancelation upon receiving the remaining $200,000.