LOANS PAYABLE

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

LOANS PAYABLE

NOTE 7-– LOANS PAYABLE

As part of a bankruptcy settlement that occurred in 2019, the Company was obligated to provide a third-party lender 8,000 shares of common stock in the Company (subject to certain transfer restrictions), in an amount which will have a public trading value within 24 months of at least $85,000. If the value of the stock does not reach $85,000 at the end of 24 months, the shareholders of the Company will provide the third party lender make-up stock to reach the value of $85,000 with a maximum amount of shares to be issued of 17,000 shares. As of March 31, 2021 and December 31, 2020, the company did not grant any stock to the lender and a liability of $85,000 remains outstanding in accounts payable and accrued expenses. In April of 2021, the two parties settled the amount in cash for $65,000 and a gain on settlement of $20,000 was recorded as other income.

In June of 2018, the Company received advances from On Deck Capital in the amounts of $150,000. The June 2018 note matured in one year from the date of issuance and required 52 weekly payments of $3,605. As of December 31, 2018, the company made no repayments on this note and had an outstanding principal balance of $150,000. As part of the Chapter 11 Bankruptcy, the outstanding principal balance of $150,000 was reclassed to liabilities subject to compromise (note payable- pre-petition). Accrued interest on this note as of December 31, 2018 was $17,360 and an additional $20,140 was accrued for based on the proof of claim submitted by the note holder. These amounts were also reclassed to liabilities subject to compromise (accounts payable and accrued expenses- pre-petition). In 2019, the Company paid $18,750, which was 10% of the allowed proof of claim in the Chapter 11 Bankruptcy of $187,500. In addition, the Company was required to pay $157,500 in five payments in the amount of $30,000 per year, with an additional $7,500 in year two. The Company recognized a gain on extinguishments of $11,250 in relation to the settlement in the year ended December 31, 2019. As of March 31, 2021 and 2020, the company has an outstanding balance of $157,500, respectively.

Minimum obligations under this loan agreement is as follows:

For the year Ending December 31,
2021	$	67,500
2022		30,000
2023		30,000
2024		30,000
	$	157,500