NOTES PAYABLE, NET

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

NOTES PAYABLE, NET

NOTE 6 - NOTES PAYABLE, NET

The following is a summary of notes payable as of March 31, 2020 and December 31, 2019:

	March 31, 2020		December 31, 2019
In January 2017, the Company issued a Senior Unsecured Note ("Note") a face value of $3,000,000, payable two years from issuance, along with an aggregate of 4,500,000 shares of Common Stock, with a fair value of $1,147,500. The Company allocated the proceeds to the note payable and common stock based on their relative fair value and recorded a discount of $830,018 to be amortized into interest expense over the two-year term of the note. The Company also paid debt issuance costs consisting of a cash fee of $120,000 and 1,020,000 shares of common stock of the Company with a fair value of $306,000. On April 30, 2018, the Company and the Noteholder agreed to extend the due date of the note until April 30, 2020 for an extension fee of 1,500,000 shares of the Common Stock issued to the Noteholder. The April 2018 change in terms of the Note payable has been determined to be a debt extinguishment in accordance with ASC 470. The reported amounts under the debt extinguishment are not significantly different than that of the Company's reported amounts. The Note was amended on February 14, 2020 to conform to the terms of the 2020 Convertible Notes Payable offering. See below	$	-	$	2,000,000
Installment loan payable related to a vehicle acquisition payable in monthly payments of $539 per month at an interest rate of 10.8% per annum payable for 36 months		11,584		12,866
Total Principal Outstanding	$	11,584	$	2,012,866
Unamortized Deferred Debt Discount		-		(26,722	)
Unamortized Deferred Debt Issuance Costs		-		(9,866	)
Notes Payable, Net	$	11,584	$	1,976,278
Notes Payable, current portion, net of discounts and current portion	$	5,486	$	5,341
Notes Payable, net of discounts and current portion		6,098		1,970,937
	$	11,584	$	1,976,278

As noted above, the Company and the Stern Trust entered an Amended and Restated Promissory Note (the "Restated Stern Note") providing that the $2,000,000 Note will be due and payable on the same terms (bearing interest at 15% per annum) and on the same maturity date as the 2020 Notes and that the interest due under the Note as of January 31, 2020 in the amount of $662,000 will remain due and payable on the same terms as exist in the Note prior to modification provided that the maturity of such interest shall be extended to the same maturity date as the 2020 Notes detailed in Note 7. The Company accounted for the Restated Stern Note as an extinguishment of the Note and recorded a charge of $985,000 included in Other expenses in accompanying condensed consolidated statements of operations.

The following is a roll-forward of the Company's notes payable and related discounts for the three months ended March 31, 2020:

	Principal Balance			Debt Discounts			Debt Issuance Costs			Total
Balance at December 31, 2019	$	2,012,866		$	(9,866	)	$	(26,722	)	$	1,976,278
Payments		(1,282	)		-			-			(1,282	)
Conversion of note payable to convertible notes payable		(2,000,000	)		-			-			(2,000,000	)
Amortization		-			9,866			26,722			36,588
Balance at March 31, 2020	$	11,584		$	-		$	-		$	11,584

See Note 7 with the respect to the conversion of the $2,000,000 Senior Unsecured Note.