Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 18, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | SOBR Safe, Inc. | |
Entity Central Index Key | 0001425627 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Jun. 30, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity Common Stock Shares Outstanding | 20,046,847 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash | $ 727,633 | $ 681,759 |
Related party receivables | 6,446 | 0 |
Prepaid expenses | 9,488 | 9,054 |
Total current assets | 743,567 | 690,813 |
Property and Equipment-net accumulate depreciation $44,788 and $43,683 at June 30, 2020 and December 31, 2019, respectively | 46,620 | 0 |
SOBR Safe Intellectual Technology net of accumaulted amortization of $32,122 at June 30, 2020 | 3,822,553 | 0 |
Other assets | 8,680 | 0 |
Total Assets | 4,621,420 | 690,813 |
Current liabilities | ||
Accounts payable | 78,202 | 213,880 |
Accrued expenses | 393,882 | 419,836 |
Accrued interest payable | 126,417 | 674,041 |
Related party payables | 31,590 | 905,443 |
Derivative liabilities | 0 | 60,650 |
Common stock subscriptions payable | 100,126 | 79,624 |
Preferred stock subscriptions payable | 1,770,000 | 1,000,000 |
Notes payable - current - related parties* Includes unamortized debt discount related to detached warrants of none and $8,656 at June 30, 2020 and December 31, 2019, respectively | 1,496,999 | 760,886 |
Notes payable - current - non-related parties | 145,848 | 169,574 |
Total current liabilities | 4,143,064 | 4,283,934 |
Total Liabilities | 4,143,064 | 4,283,934 |
Stockholders' Equity (Deficit) | ||
Common stock, $0.00001 par value; 100,000,000 shares authorized; 20,046,424 and 6,452,993 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively after 1-for-33.26 reverse stock split | 201 | 65 |
Additional paid-in capital | 48,203,770 | 15,971,392 |
Accumulated deficit | (47,672,155) | (19,511,168) |
Total SOBR Safe, Inc. stockholders' equity (deficit) | 531,816 | (3,539,711) |
Noncontrolling interest | (53,460) | (53,410) |
Total Stockholders' Equity (Deficit) | 478,356 | (3,593,121) |
Total Liabilities and Stockholders' Equity (Deficit) | 4,621,420 | 690,813 |
Series A-1 Convertible Preferred stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Series A-1 Convertible Preferred stock, $0.00001 par value; 2,000,000 shares authorized, no shares issued and outstanding as of June 30, 2020 and December 31, 2019 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Property and Equipment-net accumulate depreciation | $ 44,788 | $ 43,683 |
SOBR Safe Intellectual Technology net, accumaulted amortization | 32,122 | |
Current liabilities | ||
Notes payable current - related parties, unamortized debt discount | $ 0 | $ 8,656 |
Stockholders' Deficit | ||
Common stock, shares par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 20,046,424 | 6,452,993 |
Common stock, shares outstanding | 20,046,424 | 6,452,993 |
Series A-1 Convertible Preferred stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Operating expenses: | ||||
General and administrative | 177,915 | 81,483 | 276,107 | 150,497 |
Stock-based compensation expense | 0 | 0 | 41,302 | 0 |
Management salaries and consulting fees | 461,864 | 0 | 683,993 | 0 |
Research and development | 89,570 | 0 | 157,280 | 0 |
Total operating expenses | 729,349 | 81,483 | 1,158,682 | 150,497 |
Loss from operations | (729,349) | (81,483) | (1,158,682) | (150,497) |
Other income (expense): | ||||
Loss on extinguishment of debt, net | (297,711) | 0 | (269,144) | 0 |
Gain on fair value adjustment - derivatives | 61,350 | 4,000 | 60,650 | 3,200 |
Interest expense | (17,397) | (67,065) | (65,631) | (130,951) |
Amortization of interest - beneficial conversion feature | (1,407,501) | (12,407) | (1,407,675) | (17,763) |
Asset impairment adjustment | (25,320,555) | 0 | (25,320,555) | 0 |
Total other income (expense) | (26,981,814) | (75,472) | (27,002,355) | (145,514) |
Loss before provision for income taxes | (27,711,163) | (156,955) | (28,161,037) | (296,011) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net loss | (27,711,163) | (156,955) | (28,161,037) | (296,011) |
Net loss attributable to noncontrolling interest | 199 | 818 | 50 | 1,585 |
Net loss attributable to SOBR Safe, Inc. | $ (27,710,964) | $ (156,137) | $ (28,160,987) | $ (294,426) |
Net loss per share | ||||
(Basic and fully diluted) | $ (2.45) | $ (0.034) | $ (2.97) | $ (0.069) |
Weighted average number of common shares outstanding | 11,330,815 | 4,576,236 | 9,484,508 | 4,246,430 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) | Total | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Stockholders Equity (Deficit) SOBR Safe Inc [Member] | Noncontrolling Interest [Member] |
Balance, shares at Dec. 31, 2018 | 3,510,255 | 1,388,575 | |||||
Balance, amount at Dec. 31, 2018 | $ (3,423,431) | $ 35 | $ 14 | $ 14,888,941 | $ (18,262,136) | $ (3,373,146) | $ (50,285) |
Common stock issued for cash, shares | 1,065,982 | ||||||
Common stock issued for cash, amount | 39,000 | $ 11 | $ 0 | 38,989 | 0 | 39,000 | 0 |
Paid-in capital - fair value of stock warrants granted | 22,665 | 0 | 0 | 22,665 | 0 | 22,665 | 0 |
Paid-in capital - gain on related party debt conversion | 8,113 | 0 | 0 | 8,113 | 0 | 8,113 | 0 |
Net loss for the period | (139,056) | $ 0 | $ 0 | 0 | (138,289) | (138,289) | (767) |
Balance, shares at Mar. 31, 2019 | 4,576,236 | 1,388,575 | |||||
Balance, amount at Mar. 31, 2019 | (3,492,709) | $ 46 | $ 14 | 14,958,708 | (18,400,425) | (3,441,657) | (51,052) |
Balance, shares at Dec. 31, 2018 | 3,510,255 | 1,388,575 | |||||
Balance, amount at Dec. 31, 2018 | (3,423,431) | $ 35 | $ 14 | 14,888,941 | (18,262,136) | (3,373,146) | (50,285) |
Net loss for the period | (296,011) | ||||||
Balance, shares at Jun. 30, 2019 | 4,576,236 | 1,388,575 | |||||
Balance, amount at Jun. 30, 2019 | (3,629,890) | $ 46 | $ 14 | 14,978,482 | (18,556,562) | (3,578,020) | (51,870) |
Balance, shares at Mar. 31, 2019 | 4,576,236 | 1,388,575 | |||||
Balance, amount at Mar. 31, 2019 | (3,492,709) | $ 46 | $ 14 | 14,958,708 | (18,400,425) | (3,441,657) | (51,052) |
Paid-in capital - fair value of stock warrants granted | 12,365 | 0 | 0 | 12,365 | 0 | 12,365 | 0 |
Paid-in capital - gain on related party debt conversion | 7,409 | 0 | 0 | 7,409 | 0 | 7,409 | 0 |
Net loss for the period | (156,955) | $ 0 | $ 0 | 0 | (156,137) | (156,137) | (818) |
Balance, shares at Jun. 30, 2019 | 4,576,236 | 1,388,575 | |||||
Balance, amount at Jun. 30, 2019 | (3,629,890) | $ 46 | $ 14 | 14,978,482 | (18,556,562) | (3,578,020) | (51,870) |
Balance, shares at Dec. 31, 2019 | 6,452,993 | ||||||
Balance, amount at Dec. 31, 2019 | (3,593,121) | $ 65 | $ 0 | 15,971,392 | (19,511,168) | (3,539,711) | (53,410) |
Paid-in capital - gain on related party debt conversion | 124,291 | 0 | 0 | 124,291 | 0 | 124,291 | 0 |
Net loss for the period | (449,874) | $ 0 | $ 0 | 0 | (450,023) | (450,023) | 149 |
Common stock issued for compensation, shares | 601 | ||||||
Common stock issued for compensation, amount | 20,800 | $ 0 | $ 0 | 20,800 | 0 | 20,800 | 0 |
Common stock issued due to stock warrants exercise, shares | 454,097 | ||||||
Common stock issued due to stock warrants exercise, amount | 65,728 | $ 4 | $ 0 | 65,724 | 0 | 65,728 | 0 |
Common stock issued to settle related party payables, shares | 214,883 | ||||||
Common stock issued to settle related party payables, amount | 493,074 | $ 2 | $ 0 | 493,072 | 0 | 493,074 | 0 |
Common stock issued to settle accounts payable and accrued expenses, shares | 38,323 | ||||||
Common stock issued to settle accounts payable and accrued expenses, amount | 92,385 | $ 0 | $ 0 | 92,385 | 0 | 92,385 | 0 |
Common stock issued to settle related party debt, shares | 648,739 | ||||||
Common stock issued to settle related party debt, amount | 826,964 | $ 6 | $ 0 | 826,958 | 0 | 826,964 | 0 |
Common stock issued to settle non-related party debt, shares | 70,448 | ||||||
Common stock issued to settle non-related party debt, amount | 166,526 | $ 1 | $ 0 | 166,525 | 0 | 166,526 | 0 |
Paid-in capital - fair value of stock options vested | 39,450 | 0 | 0 | 39,450 | 0 | 39,450 | 0 |
Paid-in capital - gain on related party payables conversion | 221,557 | 0 | 0 | 221,557 | 0 | 221,557 | 0 |
Paid-in capital - loss on related party debt extinguishment | 116,893 | 0 | 0 | 116,893 | 0 | 116,893 | 0 |
Paid-in capital - beneficial conversion feature | 174 | $ 0 | $ 0 | 174 | 0 | 174 | 0 |
Balance, shares at Mar. 31, 2020 | 7,880,084 | ||||||
Balance, amount at Mar. 31, 2020 | (1,875,153) | $ 78 | $ 0 | 18,139,221 | (19,961,191) | (1,821,892) | (53,261) |
Balance, shares at Dec. 31, 2019 | 6,452,993 | ||||||
Balance, amount at Dec. 31, 2019 | (3,593,121) | $ 65 | $ 0 | 15,971,392 | (19,511,168) | (3,539,711) | (53,410) |
Net loss for the period | (28,161,037) | ||||||
Balance, shares at Jun. 30, 2020 | 20,046,424 | ||||||
Balance, amount at Jun. 30, 2020 | 478,356 | $ 201 | $ 0 | 48,203,770 | (47,672,155) | 531,816 | (53,460) |
Balance, shares at Mar. 31, 2020 | 7,880,084 | ||||||
Balance, amount at Mar. 31, 2020 | (1,875,153) | $ 78 | $ 0 | 18,139,221 | (19,961,191) | (1,821,892) | (53,261) |
Common stock issued for cash, amount | 27,120,000 | 120 | 0 | 27,119,880 | 0 | 27,120,000 | 0 |
Paid-in capital - fair value of stock warrants granted | 695,454 | 0 | 0 | 695,454 | 0 | 695,454 | 0 |
Net loss for the period | (27,711,163) | $ 0 | $ 0 | 0 | (27,710,964) | (27,710,964) | (199) |
Common stock issued to settle related party payables, shares | 45,268 | ||||||
Common stock issued to settle related party payables, amount | 86,740 | $ 1 | $ 0 | 86,739 | 0 | 86,740 | 0 |
Common stock issued to settle accounts payable and accrued expenses, shares | 121,072 | ||||||
Common stock issued to settle accounts payable and accrued expenses, amount | 173,292 | $ 2 | $ 0 | 173,290 | 0 | 173,292 | 0 |
Paid-in capital - gain on related party payables conversion | 50,741 | 0 | 0 | 50,741 | 0 | 50,741 | 0 |
Paid-in capital - beneficial conversion feature | 1,407,501 | $ 0 | $ 0 | 1,407,501 | 0 | 1,407,501 | 0 |
Common stock issued for asset purchase, shares | 12,000,000 | ||||||
Paid-in capital - loss on extinguishment of convertible notes | 273,462 | $ 0 | $ 0 | 273,462 | 0 | 273,462 | 0 |
Paid-in capital - fair value of stock options vested | 257,482 | $ 0 | $ 0 | 257,482 | 0 | 257,482 | 0 |
Balance, shares at Jun. 30, 2020 | 20,046,424 | ||||||
Balance, amount at Jun. 30, 2020 | $ 478,356 | $ 201 | $ 0 | $ 48,203,770 | $ (47,672,155) | $ 531,816 | $ (53,460) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Operating Activities: | ||
Net loss | $ (28,161,037) | $ (296,011) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 33,227 | 0 |
Loss on debt extinguishment, net | 269,144 | 0 |
Change in fair value of derivative liability | (60,650) | (3,200) |
Amortization of interest - beneficial conversion feature | 1,407,675 | 17,763 |
Stock warrants expense | 8,656 | 15,093 |
Stock options expense | 296,932 | 0 |
Stock-based compensation expense | 41,302 | 0 |
Impairment loss | 25,320,555 | 0 |
Changes in assets and liabilities: | ||
Related party receivables | (6,446) | 0 |
Prepaid expenses | (434) | 2,025 |
Other assets | (8,680) | 0 |
Accounts payable | 123,736 | (28,617) |
Accrued expenses | 39,644 | (1,428) |
Accrued interest payable | (47,675) | 78,767 |
Related party payables | (21,740) | 45,913 |
Stock subscriptions payable | 0 | 787 |
Net cash used in operating activities | (765,791) | (168,908) |
Financing Activities: | ||
Proceeds from notes payable - related parties | 0 | 74,750 |
Proceeds from notes payable - non-related parties | 41,665 | 60,000 |
Proceeds from issuances of common stock - non-related parties | 0 | 39,000 |
Proceeds from offering of preferred stock - related parties | 770,000 | 0 |
Net cash provided by financing activities | 811,665 | 173,750 |
Net Change In Cash | 45,874 | 4,842 |
Cash At The Beginning Of The Period | 681,759 | 89 |
Cash At The End Of The Period | 727,633 | 4,931 |
Schedule Of Non-Cash Investing And Financing Activities: | ||
Gain on related party payables converted to capital | 272,299 | 15,522 |
Accounts payables and accrued expenses converted to capital | 265,677 | 0 |
Related party payables converted to capital | 579,814 | 0 |
Related party debt converted to capital after exercise of cashless stock warrants | 65,728 | 0 |
Related party debt converted to capital | 826,964 | 0 |
Non-related party debt converted to capital | 166,526 | 0 |
Gain on related party debt converted to capital | 124,291 | 0 |
Shares issued for cash received in prior years | 20,800 | |
Fair value of stock warrants granted | 0 | 35,030 |
Fair value of embedded conversion feature | $ 0 | $ 56,100 |
Issuance of common stock, stock warrants and convertible note for asset purchase | 29,222,955 | |
Intrinic Value Beneficial Conversion Feature | $ 1,407,501 | $ 0 |
Supplemental Disclosure: | ||
Cash paid for interest | 765 | 3,750 |
Cash paid for income taxes | $ 0 | $ 0 |
ORGANIZATION, OPERATIONS AND SU
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | TransBiotec, Inc. (“TransBiotec – DE”), formerly Imagine Media LTD., was incorporated August, 2007 in the State of Delaware. A corporation also named TransBiotec, Inc. (“TransBiotec – CA”) was formed in the state of California July 4, 2004. Effective September 19, 2011 TransBiotec - DE was acquired by TransBiotec - CA in a transaction classified as a reverse acquisition as the shareholders of TransBiotec - CA retained the majority of the outstanding common stock of TransBiotec - DE after the share exchange. The financial statements represent the activity of TransBiotec - CA from July 4, 2004 forward, and the consolidated activity of TransBiotec - DE and TransBiotec - CA from September 19, 2011 forward. TransBiotec - DE and TransBiotec - CA are hereinafter referred to collectively as the “Company” or “We”. The Company has developed and plans to market and sell a non-invasive alcohol sensing system which includes an ignition interlock. The Company has not generated any revenues from its operations. On March 23, 2020, the Company filed a Definitive 14C providing notice that the Board of Directors has recommended, and that holders of a majority of the voting power of the Company’s outstanding stock voted, to approve the following. 1. To remove and re-elect four (4) directors to serve until the next Annual Meeting of Shareholders and thereafter until their successors are elected and qualified; and 2. To approve an amendment to the Company’s Certificate of Incorporation to: (a) change the Company’s name to SOBR SAFE, Inc., (b) decrease the Company’s authorized common stock from 800,000,000 shares, par value $0.00001 to 100,000,000 shares, par value $0.00001, and (c) effect a reverse stock split of the Company’s outstanding common stock at a ratio between 1-for-32 and 1-for-35 (with the exact ratio to be determined by the directors in their sole discretion without further approval by the shareholders). The above actions taken by the Company’s stockholders became effective on or about May 21, 2020. The effective dates of the above actions were June 5, 2020 and April 20, 2020, respectively, and the actual reverse stock split ratio was 1-for-33.26. All share and per amounts have been adjusted in the financial statements to reflect the effect of the reverse stock split. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended December 31, 2019, included in the Company’s Annual Report on Form 10-K filed with the SEC on April 17, 2020. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2020 and December 31, 2019, and results of operations for the three month and six month periods ended June 30, 2020 and 2019. Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiary, TransBiotec-CA. We have eliminated all intercompany transactions and balances between entities consolidated in these unaudited condensed financial statements. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the valuation of the derivative liabilities, beneficial conversion feature expenses and intellectual technology. Actual results could differ from those estimates. Cash The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. The Company does not have any cash equivalents as of June 30, 2020 and December 31, 2019. Financial Instruments Pursuant to Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures Financial Instruments Level Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets: quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company’s financial instruments consist primarily of cash, accounts payable, accrued expenses, accrued interest payable, notes payable, related party payables, convertible debentures, and other payables. Pursuant to ASC 820 and 825, the fair value of our derivative liabilities is determined based on “Level 3” inputs. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations. The following table presents assets and liabilities that are measured and recognized at fair value as of June 30, 2020 and December 31, 2019: June 30, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 $ - $ - $ 60,650 Beneficial Conversion Features From time to time, the Company may issue convertible notes that may contain a beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid-in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method. Derivative Instruments The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instruments are initially recorded at their fair values and are then re-valued at each reporting date, with changes in the fair value reported in the unaudited condensed consolidated statements of operations under other income (expense). The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option at its fair value as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As a result of entering into warrant agreements, for which such instruments contained a variable conversion feature with no floor, the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 whereby all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation issued to employees or directors. For stock-based derivative financial instruments, the Company uses a Monte Carlo Simulation model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. Preferred Stock We apply the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any), which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity. Minority Interest (Noncontrolling Interest) A subsidiary of the Company has minority members representing ownership interests of 1.38% at June 30, 2020 and December 31, 2019. The Company accounts for these minority, or noncontrolling interests, pursuant to ASC 810-10-65 whereby gains and losses in a subsidiary with a noncontrolling interest are allocated to the noncontrolling interest based on the ownership percentage of the noncontrolling interest, even if that allocation results in a deficit noncontrolling interest balance. Stock-based Compensation The Company follows the guidance of the accounting provisions of ASC 718 Share-based Compensation, which requires the use of the fair-value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (warrants and options). The fair value of each option award is estimated on the date of grant using the Black-Scholes options-pricing model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. The Company has not paid dividends historically and does not expect to pay them in the future. Expected volatilities are based on weighted averages of the historical volatility of the Company’s common stock estimated over the expected term of the options. The expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term as historically the Company had limited activity surrounding its options. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term. In applying the Black-Scholes options-pricing model, assumptions used were as follows: Dividend yield 0 % Expected volatility 133% - 171 % Risk free interest rate 0.43% - 1.70 % Expected life 1.5 - 7.17 years Research and Development The Company accounts for its research and development costs pursuant to ASC 730, whereby it requires the Company to disclose the amounts of costs for company and customer-sponsored research and development activities, if material. Research and development costs are expensed as incurred. The Company incurred research and development costs as it acquired new knowledge to bring about significant improvements in the functionality and design of its SOBR product. Research and development costs were $157,280 and none during the six month periods ended June 30, 2020 and June 30, 2019, respectively. Income Tax The Company accounts for income taxes pursuant to Accounting Standards Codification ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has not recorded any deferred tax assets or liabilities at June 30, 2020 and December 31, 2019, respectively. Net Loss Per Share The basic and fully diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding. Related Parties Related parties are any entities or individuals that, through employment, ownership or other means, possess the ability to direct or cause the direction of the management and policies of the Company. New Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) Codification Improvements to Leases (Topic 842): Amendments to the FASB Accounting Standards Codification. Management adopted the provisions of this statement and took them into account in the preparation of the financial statements for the year ended December 31, 2019. The Company has only short-term leases and has elected to utilize the practical expedient and as a result, has not recognized a right of use asset or related liability on its balance sheet. In July 2017, the FASB issued ASU-2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Noncontrolling Interests of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception The effective date for ASU 2017-11 is for annual or any interim periods beginning after December 15, 2018. In March 2018, the FASB issued ASU 2018-05, Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendments in this update provide guidance on when to record and disclose provisional amounts for certain income tax effects of the Tax Cuts and Jobs Act (“Tax Reform Act”). The amendments also require any provisional amounts or subsequent adjustments to be included in net income from continuing operations. Additionally, this ASU discusses required disclosures that an entity must make with regard to the Tax Reform Act. This ASU is effective immediately as new information is available to adjust provisional amounts that were previously recorded. Management adopted the provisions of this statement and took them into account in the preparation of the financial statements for the year ended December 31, 2019. The Company currently has no revenue and only net operating loss carryforwards that result in a tax benefit. The Company has no deferred tax assets (offset in full by a valuation allowance) or tax liabilities on its balance sheet as of June 30, 2020 and December 31, 2019. In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting In July 2019, the FASB issued ASU 2019-07, Codification Updates to SEC Sections Management adopted the provisions of this statement and took them into account in the preparation of the unaudited condensed consolidated financial statements, and it did not have a material impact on the Company’s reported consolidated financial results. In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes Income Taxes In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jun. 30, 2020 | |
GOING CONCERN | |
NOTE 2. GOING CONCERN | The Company has suffered recurring losses from operations and has a working capital deficit and stockholders’ deficit, and in all likelihood, will be required to make significant future expenditures in connection with continuing marketing efforts along with general and administrative expenses. As of June 30, 2020, the Company has an accumulated deficit of approximately $47,700,000. During the six months ended June 30, 2020, the Company also experienced negative cash flows from operating activities of $765,791. It appears these principal conditions or events, considered in the aggregate, indicate it is probable that the entity will be unable to meet its obligations as they become due within one year after the date the financial statements are issued. As such, there is substantial doubt about the entity’s ability to continue as a going concern. The Company has been considering opportunities to create synergy with its SOBR product to mitigate the probable conditions that have raised substantial doubt about the entity’s ability to continue as a going concern. On May 6, 2019, the Company entered into an Asset Purchase Agreement with IDTEC, LLC (and Amendment No. 1 dated March 9, 2020) (the “APA”), under which IDTEC, LLC (“IDTEC”), an affiliate owned by First Capital Holdings, LLC (“FCH”), agreed to provide personnel, experience, and access to funding to assist with the development of the Company’s SOBR device, as well as to sell to the Company certain robotics assets, which the Company’s management believes are synergistic with its current assets. The APA transaction closed on June 5, 2020 providing the Company with ownership in the SOBR Safe intellectual technology. On December 12, 2019, the Company entered into a Series A-1 Preferred Stock Purchase Agreement (the “SPA”) with SOBR SAFE, LLC (“SOBR SAFE”), a Delaware limited liability company and an entity controlled by Gary Graham, one of the Company’s Directors, under which (i) the Company agreed to create a new series of convertible preferred stock entitled “Series A-1 Convertible Preferred Stock,” with 2,000,000 shares authorized and the following rights: (a) dividend rights of 8% per annum based on the original issuance price of $1 per share, (b) liquidation preference over our common stock, (c) conversion rights into shares of our common stock at $1 per share, (d) redemption rights such that the Company has the right, upon thirty days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price, (e) shall not be callable by the Company, and (f) each share of Series A-1 Convertible Preferred Stock will vote on an “as converted” basis; and (ii) SOBR SAFE agreed to acquire 1,000,000 shares of the Company’s Series A-1 Convertible Preferred Stock (the “Preferred Shares”), once created, in exchange for $1,000,000 (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019 and has not issued these Preferred Shares as of June 30, 2020: however, the Company plans to issue these Preferred Shares in Summer 2020. As a result of the offering, the Company has a cash balance of $727,633 and $681,759 at June 30, 2020 and December 31, 2019, respectively. On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to evolve as of the date of this Annual Report. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity for fiscal year 2020. However, if the pandemic continues, it will have an adverse effect on the Company’s results of future operations, financial position, and liquidity in year 2020. Management believes actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern; however, these plans are contingent upon actions to be performed by the Company and these conditions have not been met on or before June 30, 2020. Additionally, the COVID-19 outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown, which would impair the Company’s ability to raise needed funds |
ASSET PURCHASE
ASSET PURCHASE | 6 Months Ended |
Jun. 30, 2020 | |
ASSET PURCHASE | |
Note 3. Assest purchase | On June 5, 2020, the Company completed a transaction (the “Transaction”) with IDTEC subject to the terms and conditions of the APA and that was accounted for as an asset purchase. Pursuant to the APA, IDTEC provided personnel, experience, and access to funding to assist with the development of the SOBR device, as well as sold to us certain robotics assets, which our management believes are synergistic with our current assets, in exchange for 12,000,000 shares of our common stock after giving effect to the reverse stock split effected in connection with closing the Transaction. The closing of the Transaction was subject to several conditions precedent, primarily: (i) the Company had to be current in reporting requirements under the Securities Exchange Act of 1934, as amended, (ii) had to complete a reverse stock split of common stock such that approximately 8,000,000 shares were outstanding immediately prior to closing the transaction, (iii) could only have outstanding convertible instruments as set forth in the APA, (iv) authorized common stock had to be reduced to 100,000,000 shares, and (v) not have more than approximately $125,000 in current liabilities. Effective with the closing of the Transaction all of the closing conditions had been met, modified or waived by IDTEC, and the Company issued the 12,000,000 shares to IDTEC. In advance of closing the Transaction, IDTEC and a few other affiliated parties voluntarily committed personnel and funds to the Company to assist with (i) general costs related to the Transaction, (ii) ongoing operating expenses and pay for further engineering and development work on the Company’s products and prototypes, (iii) protect, maintain and develop the Company’s products and intellectual property, (iv) hire, pay and retain the proposed management team, third party consultants and advisors for the Company following the consummation of the sale contemplated in the APA and, (v) take such further actions as are necessary to more quickly expand the Company’s business subsequent to the sale of the purchased assets. The parties agreed that the funds advanced directly to the Company’s vendors were voluntary and were not the obligation of the Company and the Company had no obligation to repay these funds in the event the transaction contemplated by the APA did not close. In the event the Transaction did close, then on the closing date, the Company would issue promissory notes for the aggregate amounts incurred, paid or advanced. As a result of closing the Transaction, the Company issued a convertible promissory note for all the funds spent or advanced by IDTEC prior to closing. This note totaled $1,485,189 (the “APA Note”), carries a simple interest at 10% per annum, is due upon demand, and may be convertible into shares of common stock at $0.50 per share (after giving effect to the reverse stock split and subject to anti-dilution protection against any future securities we may issue at an effective price of less than $0.50 per share) at the discretion of the holder. The repayment of APA Note is secured by a first priority security lien or security interest in the patents, trademarks, tradenames, and other intellectual property of the Company. At closing, some of the closing conditions under the APA were either waived and/or modified by the parties. In order to document those modifications and waivers, we entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with IDTEC. One of the closing conditions that was the subject of the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement was the requirement that the Company have under $125,000 in permitted liabilities (not including aged liabilities) after closing of the Transaction. At closing we had approximately $158,000 in non-permitted liabilities under the APA. As a result, the Company issued a Warrant to Purchase Common Stock to IDTEC (the “Warrant”), under which IDTEC will purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share, if either (i) we are forced to pay a non-permitted liability, then we may force IDTEC to exercise the Warrant and pay the exercise price to pay the non-permitted liability, but only in an amount sufficient to pay the non-permitted liability, or (ii) if IDTEC otherwise elects to exercise the Warrant and acquire some or all of the shares underlying the Warrant. The Warrant expires five years after the date of issuance. The Transaction recorded as an asset purchase was valued at $29,222,955, which consists of the market price as of June 5, 2020 of the Company’s 12,000,000 shares of common stock issued totaling $27,120,000, the funds spent by IDTEC and affiliates prior to closing of $1,407,051 and the fair value of the Warrant issued of $695,454. The following summarizes the transaction closing with IDTEC on June 5, 2020: Property and equipment $ 47,725 Intangible assets 29,175,230 Total assets $ 29,222,955 Net purchase (fair value of stock issued, warrants and funds spent) $ 29,222,955 Subsequent to the Transaction closing, the Company evaluated the fair value of the assets acquired based on market estimates for property and equipment and discounted net cash flow for the SOBR Safe intellectual technology. The present value of the discounted cash flow utilized a 75% discount, which included a 25% risk return premium, over an estimated five-year net revenue stream expected to be derived from the technology acquired. Based on the assessment of fair value, the Company recognized an asset impairment loss of $25,320,555 resulting from the APA during the three-month period ended June 30, 2020. The impairment was due to the increase of the Company’s stock price value. The stock price of the Company at closing of the Transaction was significantly higher than expected from the stock price of the Company when the Company signed the APA. The number of shares to be given to IDTEC as consideration for the Transaction would not get updated for any stock price changes. In determining the fair value of the intangible assets, the Company considered, among other factors, the best use of acquired assets such as the analysis of historical financial performance of the products and estimates of future performance of the products and intellectual properties acquired. The preliminary establishment of the allocation to identifiable intangible assets required extensive use of financial information and management’s best estimate of fair value. The Company has preliminarily recorded the purchase price of the identified intangible assets and is, if applicable, amortizing such assets over their estimated useful lives of ten years. The assessment of fair value is preliminary and is based on information that was available to management at the time the unaudited condensed consolidated financial statements were prepared. Measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the acquisition date. Accordingly, differences between these preliminary estimates and the final allocation to the intangible assets may occur and these differences could have a material impact on the accompanying consolidated financial statements. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2020 | |
PROPERTY AND EQUIPMENT | |
Note 4. Property and equipment | Property and equipment, net consists of the following: June 30, December 31, 2020 2019 Robotics and testing equipment $ 46,200 $ - Office furniture and equipment 45,208 43,683 91,408 43,683 Accumulated depreciation (44,788 ) (43,683 ) Property and equipment, net $ 46,620 $ - Depreciation is computed on a straight-line basis over the assets estimated useful lives of three years. Depreciation for the three and six months ended June 30, 2020 was $1,105. There was no depreciation for the three and six months ended June 30, 2019. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2020 | |
INTANGIBLE ASSETS | |
Note 5. Intangible assets | Intangible assets consist of the following at June 30, 2020: Gross Carrying Accumulated Net Intangible Amortization Period Amount Amortization Asset (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 32,122 $ 3,822,553 10 Amortization expense for the three and six months ended June 30, 2020 was $32,122. There was no amortization expense for the three and six months ended June 30, 2019. Estimated future amortization expense for device intellectual technology intangible assets is as follows: 2021 2022 2023 2024 2025 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,895,218 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2020 | |
RELATED PARTY TRANSACTIONS | |
NOTE 6. RELATED PARTY TRANSACTIONS | On December 3, 2014, Lanphere Law Group, a related party and the Company’s largest shareholder, entered into an agreement with the Company to convert 50% of its outstanding accounts payable of $428,668 to a note payable. This note payable represents one half of the balance in the amount of $214,334 of legal fees and costs owed up until October 31, 2014. This agreement further provided that the remaining 50% of unpaid legal fees in accounts payable were to be paid and retained as a current payable. In addition, 50% of the legal fees and costs incurred beginning with the legal services provided to the Company on November 1, 2014 are to be converted on a monthly basis to common stock at a price of $0.09 per share until the accounts payable balance for legal fees is paid current. The Company has recorded to equity, a total related party gain connected to these conversions during the six month period ended June 30, 2020 and 2019 of none and $15,522, respectively. The Company converted the remaining payables to common stock through a separate agreement and there are no more payables to convert as of June 30, 2020. On July 1, 2015, the Company amended the December 3, 2014 note payable agreement with Lanphere Law Group, a related party and the C ompany’s largest shareholder, which forgave $108,000 of the note payable’s principal balance. This debt forgiveness decreased the original principal balance on the note of $214, 334 to a new principal balance of $106,335, and a related party gain of $108,000 was recorded to additional paid-in capital. On March 8, 2017, Lanphere Law Group, a related party and the Company’s largest shareholder, irrevocably elected to exercise warrants in order to acquire 969,601 shares of the Company’s common stock in exchange for an aggregate exercise price of $112,871, which was used for the deduction of $74,672 of principal and $38,199 of accrued interest related to the December 3, 2014 note payable agreement with Lanphere Law Group. The forgiveness of the note payable principal of $74,672 was recorded to equity and the $38,199 of related accrued interest was also recorded to equity. The principal balance of the note after the debt deduction was $31,662. On January 3, 2020, the note payable principal balance of $31,662 was converted to 9,520 common shares at a per share price of $3.326. As of June 30, 2020 and December 31, 2019, the principal balance of this note was none and $31,662, respectively. As of June 30, 2020 and December 31, 2019, the accrued interest on this note was none and $9,508, respectively . On January 3, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Michael Lanphere, one of the Company’s officers, under which he agreed to exercise and the Company agreed to issue 454,097 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere under two promissory notes. Mr. Lanphere’s option to acquire the shares was under the terms of certain Loan Agreement with Promissory Note and Stock Fees agreements entered into with the Company and Mr. Lanphere on April 17, 2019 and July 17, 2019. The amount of the debt reduction, and therefore the purchase price of the shares, was $65,875 which was used for the deduction of related party notes payable principal of $65,875. 180,397 common shares were issued on January 3, 2020 at an effective conversion price of $0.133 and 273,700 common shares were issued on January 3, 2020 at an effective conversion price of $0.153. After this exercise, Lanphere Law Group owns no warrants for shares of our common stock. On January 3, 2020, the Company entered into another Debt Conversion and Common Stock Purchase Plan with Michael Lanphere, one of the Company’s officers, under which the Company agreed to issue 63,225 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere under numerous other remaining promissory notes. The amount of the debt reduction, and therefore the purchase price of the shares, was $210,285 which was used for the deduction of related party notes payable principal of $169,606 and accrued interest of $40,679. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $52,000 and accounted for it as additional paid-in capital. The common shares were issued on January 3, 2020 at an effective conversion price of $3.326 per share. On January 3, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Vernon Justus, a related party, under which the Company agreed to issue 84,963 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Justus under a promissory note. The amount of the debt reduction, and therefore the purchase price of the shares, was $282,588 which was used for the deduction of a related party note payable principal of $180,001 and accrued interest of $102,587. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $70,000 and accounted for it as additional paid-in capital. The common shares were issued on January 3, 2020 at an effective conversion price of $3.326 per share. On January 16, 2020, the Company entered into a Accounts Payable Conversion and Common Stock Purchase Plan with Michael Lanphere, one of the Company’s officers, under which the Company agreed to issue 214,883 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere for unpaid legal bills. The amount of the debt reduction, and therefore the purchase price of the shares, was $714,700 which was used for the deduction of related party payables of $714,700. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $222,000 and accounted for it as additional paid-in capital. The common shares were issued on January 16, 2020 at an effective conversion price of $3.326 per share. On January 30, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Devadatt Mishal, one of the Company’s directors, under which the Company agreed to issue 499,965 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Mishal under numerous promissory notes. The amount of the debt reduction, and therefore the purchase price of the shares, was $456,641 which was used for the deduction of related party notes payable principal of $270,300 and accrued interest of $186,500. The Company also recorded a loss on related party debt extinguishment of approximately $144,000. The common shares were issued on January 30, 2020 at an effective conversion price of $0.91465 per share. On March 23, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Prakash Gadgil, one of the Company’s former directors, under which the Company agreed to issue 586 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Gadgil under a promissory note. The amount of the debt reduction, and therefore the purchase price of the shares, was $1,950 which was used for the deduction of a related party note payable principal of $1,950. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $1,000 and accounted for it as additional paid-in capital. The common shares were issued on March 23, 2020 at an effective conversion price of $3.326 per share. On April 6, 2020, the Company agreed with Nick Noceti, the Company’s former Chief Financial Officer, to issue 38,437 shares of its common stock in exchange for amounts due for accounting fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $127,840 which was used for the deduction of a related party accounts payable of $127,480. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $49,000 and accounted for it as additional paid-in capital. The common shares were issued on April 4, 2020 at an effective conversion price of $3.326 per share. On April 7, 2020, the Company agreed with Charles Bennington, one of the Company’s former directors, to issue 6,831 shares of its common stock in exchange for amounts due for Board of Director fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $9,656 which was used for the deduction of a related party accounts payable of $9,656. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $2,000 and accounted for it as additional paid-in capital. The common shares were issued on April 7, 2020 at an effective conversion price of $1.41 per share. |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2020 | |
NOTES PAYABLE | |
NOTE 7. NOTES PAYABLE | Related Parties The Company has convertible notes payable to related parties that have a principal balance of $1,485,189 and $161,000 as of June 30, 2020 and December 31, 2019, respectively. These notes carry interest rates of 10% and are due on demand. The notes carry fixed and variable conversion prices per share at June 30, 2020. The Company evaluated these convertible notes payable for derivative embedded conversion features and beneficial conversion features. The Company determined that there were both derivative embedded conversion features and beneficial conversion features to record. The conversion features were either fully amortized upon grant or over the life of the convertible notes payable. The conversion features were fully amortized as of June 30, 2020 and December 31, 2019. During the six months ended June 30, 2020 and 2019, beneficial conversion feature amortization expense related to these convertible notes payable of $1,485,189 and none, respectively, was accounted for as amortization of interest - beneficial conversion feature expense in the condensed consolidated statements of operations. During the six months ended June 30, 2020 and 2019, derivative embedded conversion feature amortization expense related to these convertible notes payable of $0 and $56,100 respectively, was accounted for as interest expense in the condensed consolidated statements of operations. During the three months ended March 31, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with a related party, under which the Company agreed to issue 156,474 shares of its common stock in exchange for a reduction of four convertible notes payable to related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $143,119 which was used for the deduction of related party convertible notes payable principal of $91,000 and accrued interest of $52,119. The Company has a non-convertible notes payable to related parties principal balance of $11,810 and $328,423 as of June 30, 2020 and December 31, 2019, respectively. The principal balance consist of one zero interest note payable with a due date of December 31, 2012. This note is currently in default. During the three months ended March 31, 2020, the Company converted eight non-convertible notes payable to related parties that had a principal balance of $316,613. During the three months ended March 31, 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with four related parties, under which the Company agreed to issue 342,399 shares of its common stock in exchange for a reduction of eight non-convertible notes payable to related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $549,311 which was used for the deduction of related party non-convertible notes payable principal of $316,613 and accrued interest of $232,698. The Company has a notes payable with detached free-standing warrants to related parties principal balance of none and $280,119 as of June 30, 2020 and December 31, 2019, respectively. These notes carried interest rates ranging from 7% - 10% and had due dates ranging from 08/05/2015 – 03/30/2020. The exercise price for each note payable with detached free-standing warrants ranged from $0.03 - $0.53. As of June 30, 2020 and December 31, 2019, these notes carried outstanding detached free-standing warrants of none and 454,097, respectively. The unamortized discount at June 30, 2020 and December 31, 2019 is none and $8,656, respectively. During the six-month period ended June 30, 2020 and 2019, stock warrants amortization expense recorded as interest expense was $8,656 and $15,093, respectively. The relative fair market value of the related stock warrants granted during the six-month period ended June 30, 2020 and 2019 was none and $35,030, respectively. During the three months ended March 31, 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with two related parties, under which the Company agreed to issue 601,783 shares of its common stock in exchange for a reduction of 24 notes payable with detached free-standing warrants to related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $320,858 which was used for the deduction of related party notes payable with detached free-standing warrants principal of $280,119 and accrued interest of $40,739. Total interest expense for related party notes was $42,161 and $43,235 for the six-month period ended June 30, 2020 and 2019, respectively. Related party notes payable consist of the following: June 30, 2020 December 31, 2019 Convertible Notes Payable $ 1,485,189 $ 161,000 Conventional Non-Convertible Notes Payable 11,810 328,423 Notes Payable with Detached Free-standing Warrants - 280,119 Unamortized Discount - (8,656 ) Net Related Party Notes Payable $ 1,1496,999 $ 760,886 Non-Related Parties The Company has convertible notes payable to non-related parties that have a principal balance of $56,683 and $143,136 as of June 30, 2020 and December 31, 2019, respectively. These notes carry interest rates ranging from 5% - 30% and have due dates ranging from 2/20/2013 – 3/06/2022. Three of the four notes are currently in default. These notes carry conversion prices ranging from $1.99 - $10.76 per share. The Company evaluated these convertible notes payable for derivative embedded conversion features and beneficial conversion features. The Company determined that there were beneficial conversion features to record. The conversion features were either fully amortized upon grant or over the life of the convertible notes payable. The conversion features were fully amortized as of June 30, 2020 and December 31, 2019. During the six months ended June 30, 2020 and 2019, beneficial conversion feature amortization expense related to these convertible notes payable of none and $5,356, respectively, was accounted for as amortization of interest - beneficial conversion feature expense in the condensed consolidated statements of operations. During the three month period ended March 31, 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with six non-related parties, under which the Company agreed to issue 50,135 shares of its common stock in exchange for a reduction of eleven convertible notes payable to non-related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $166,749 which was used for the deduction of non-related party convertible notes payable principal of $83,952 and accrued interest of $82,797. The Company recorded a non-related party gain on loan extinguishment of approximately $68,000. During the three months ended March 31, 2020, the Company also entered into a non-related party convertible note payable agreement to convert a high interest rate convertible non-related party note payable with a principal balance of $25,000 and accrued interest due of $22,500 to a non-related party convertible note payable of $47,500 that accrues interest at 5%. The note conversion rate is $2 per common share. The Company recorded a loss on non-related party debt extinguishment of $11,697. On June 9, 2020, the holder of a $25,000 convertible promissory note with interest at 30% and accrued interest of $61,875 replaced the carrying amount of the note and its conversion features with a new non-convertible note totaling $47,500 that bears interest at 5%. The Company recorded a gain on non-related party debt extinguishment of $61,875. The Company has non-convertible notes payable to non-related parties that have a principal balance of $84,165 and $21,438 as of June 30, 2020 and December 31, 2019, respectively. These notes carry interest rates ranging from 1% - 10% and have due dates ranging from 12/27/2013 - 6/6/2022. Two of the four notes are currently in default. During the three month period ended March 31, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with a non-related party, under which the Company agreed to issue 20,313 shares of its common stock in exchange for a reduction of his non-convertible non-related party note payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $67,561 which was used for the deduction of non-related party non-convertible notes payable principal of $3,938 and accrued interest of $63,623. The Company recorded a non-related party gain on loan extinguishment of $39,000. On May 12, 2020, the Company received proceeds of $41,665 from a commercial bank under the SBA Payroll Protection Loan Program. The loan requires interest at 1% and 18 monthly payments of principal and interest beginning December 5, 2020. Provisions of the SBA Payroll Protection Loan Program allow for portions or all the loan balance to be forgiven should certain criteria be met. The Company expects that it will meet the criteria for the full of amount of loan forgiveness. The Company has one note payable with detached free-standing warrants to a non-related party that has a principal balance of $5,000 and $5,000 as of June 30, 2020 and December 31, 2019, respectively. This note carries an interest rate of 10% and had a due date of 9/11/2014. This note is currently in default. The detached free-standing warrants for this note payable were not exercised by the note holder and expired on May 16, 2019. Total interest expense for non-related party notes was $10,885 and $28,762 for the six month period ended June 30, 2020 and 2019, respectively. Non- related party notes payable consist of the following: June 30, 2020 December 31, 2019 Convertible Notes Payable $ 84,165 $ 143,136 Conventional Non-Convertible Notes Payable 56,683 21,438 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Unamortized Beneficial Conversion Feature - - Net Non-Related Party Notes Payable $ 145,848 $ 169,574 |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 6 Months Ended |
Jun. 30, 2020 | |
DERIVATIVE LIABILITY | |
NOTE 8. DERIVATIVE LIABILITY | In 2019, the Company borrowed $ 70,000 under convertible promissory notes agreement from an unrelated party that are due upon demand. The notes bear interest at a rate of 10% per annum and are convertible into the Company’s common shares at a variable conversion price based on a 50% discount of the market price at an undetermined future date. The Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASU 2017-11 (ASC 815-15 Derivatives and Hedging), and determined the embedded conversion features should be classified as a derivative because the exercise price of the convertible note is subject to a variable conversion rate and should therefore be accounted for at fair value under ASC 820, Fair Value Measurements and Disclosures, Financial Instruments The embedded derivative for the notes is carried on the Company’s balance sheet at fair value. The derivative liability is marked to market each measurement period and any unrealized change in fair value is recorded as a component of the statement of operations and the associated fair value carrying amount on the balance sheet is adjusted by the change. The Company fair values the embedded derivatives using a Monte Carlo simulation model based on the following assumptions: (1) expected volatility of 180%, (2) risk-free interest rate of 0.13%, and (3) expected life from 1 month to 1 year. On March 1, 2019, the date of the first note, the fair value of the embedded derivative was $28,000. On May 3, 2019, the date of the second note, the fair value of the embedded derivative was $28,100. On October 26, 2019, the date of the third note, the fair value of the embedded derivative was $8,700. The notes carried an embedded conversion feature of $64,800 that was fully amortized to interest expense during the year ended December 31, 2019. The notes were not converted and deemed paid in full at the closing of the Transaction on June 5, 2020. The principal amount of these notes were settled and transferred to the APA Note and a loss on debt extinguishment of $273,462 was recognized during the six-month period ended June 30, 2020. The fair value of the embedded derivative recorded on the balance sheet as a liability was none and $60,650 at June 30, 2020 and December 31, 2019, respectively. Utilizing level 3 inputs, the Company recorded a fair market value gain of $60,650 during the six months ended June 30, 2020 and a gain of $3,200 during same period ended June 30, 2019. A summary of the activity of the derivative liability is shown below: Balance at December 31, 2019 $ 60,650 Fair market value adjustments, including settlements (60,650 ) Balance at June 30, 2020 $ 0 |
STOCK SUBSCRIPTION PAYABLE
STOCK SUBSCRIPTION PAYABLE | 6 Months Ended |
Jun. 30, 2020 | |
STOCK SUBSCRIPTION PAYABLE | |
NOTE 9. STOCK SUBSCRIPTIONS PAYABLE | The Company has common stock subscriptions payable due to related parties of $79,624 payable with 89,077 of its common shares at June 30, 2020. The Company has common stock subscriptions payable due to related parties of $79,624 payable with 89,077 of its common shares at December 31, 2019. The Company recorded a related party gain of none and $15,522 related to the outstanding common stock subscriptions payable during the six month period ended June 30, 2020 and 2019, respectively. The Company has common stock subscriptions payable due to non-related parties of $20,503 payable with 15,108 of its common shares at June 30, 2020. The Company had no common stock subscriptions payable due to non-related parties at December 31, 2019. The Company has preferred stock subscriptions payable due to related parties of $1,770,000 payable with 1,770,000 of its 8% Series A-1 Convertible Preferred shares as of June 30, 2020. The Company has preferred stock subscriptions payable due to related parties of $1,000,000 payable with 1,000,000 of its 8% Series A-1 Convertible Preferred shares as of December 31, 2019. |
COMMON STOCK
COMMON STOCK | 6 Months Ended |
Jun. 30, 2020 | |
COMMON STOCK | |
NOTE 10. COMMON STOCK | On February 25, 2019, the Company issued 1,065,982 shares of its common stock to non-related parties for $39,000 in cash. On January 3, 2020, the Company converted $34,534 of non-related party debt into 10,383 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $6,907 as other income in the consolidated statements of operations. On January 3, 2020, the Company converted $6,482 of non-related party debt into 1,949 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $1,296 as other income in the consolidated statements of operations. On January 3, 2020, the Company converted $39,356 of non-related party debt into 11,833 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $7,871 as other income in the consolidated statements of operations. On January 3, 2020, the Company converted $97,624 of non-related party debt into 29,352 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $19,525 as other income in the consolidated statements of operations. On January 3, 2020, a related party exercised 273,700 stock warrants and in exchange converted $41,875 in related party debt owed to him under a promissory note. The shares were issued at a value of $0.1530 per share pursuant to the terms of the convertible note. On January 3, 2020, a related party exercised 180,397 stock warrants and in exchange converted $24,000 in related party debt owed to him under a promissory note. The shares were issued at a value of $0.13304 per share pursuant to the terms of the convertible note. On January 3, 2020, the Company converted $210,285 of related party debt into 63,225 issued shares of its common stock at $3.326 per share and recorded a related party gain of $42,057 to additional paid-in capital. On January 3, 2020, the Company converted $282,588 of related party debt into 84,963 issued shares of its common stock at $3.326 per share and recorded a related party gain of $56,518 to additional paid-in capital. On January 16, 2020, the Company converted $40,000 of non-related party accounts payable into 12,026 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $22,840 as other income in the consolidated statements of operations. On January 16, 2020, the Company converted $87,464 of non-related party accounts payable into 26,297 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $49,942 as other income in the consolidated statements of operations. On January 16, 2020, the Company converted $714,700 of related party payables into 214,883 issued shares of its common stock at $3.326 per share and recorded a related party gain of $408,094 to additional paid-in capital. On January 22, 2020, the Company converted $23,814 of non-related party debt into 7,160 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $14,289 as other income in the consolidated statements of operations. On January 30, 2020, the Company converted $456,641 of related party debt into 499,965 issued shares of its common stock at $0.9146 per share and recorded a related party gain of $456,634 to additional paid-in capital. The Company recorded a loss on debt extinguishment of $143,660 as other expense in the consolidated statements of operations. On March 15, 2020, the Company converted $32,500 of non-related party debt into 9,771 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $19,240 as other income in the consolidated statements of operations. On March 20, 2020, the Company issued 601 common shares at $34.59 per share to a non-related party as stock compensation for services provided. On March 23, 2020, the Company converted $1,950 of related party debt into 586 issued shares of its common stock at $3.326 per share and recorded a related party gain of $1,073 to additional paid-in capital. On April 1, 2020, the Company converted $43,750 of non-related party debt into 75,165 issued shares of its common stock at $.5821 per share and recorded a non-related party loss of $43,743 as other expense in the consolidated statements of operations. On April 6, 2020, the Company issued 38,437 shares of its common stock to a related party in exchange for their agreement to settle a related party accounts payable of $127,840 owed to them. The shares were issued at a value of $79,133 and recorded a related party gain of $48,707 to additional paid-in-capital. On April 7, 2020, the Company issued 6,831 shares of its common stock to a related party in exchange for their agreement to settle an accounts payable balance of $9,656 owed to them. The shares were issued at a value of $7,621 and recorded a related party gain of $2,035 to additional paid-in-capital. On April 20, 2020, the Company agreed to convert 9,346 shares of its common stock at $1.039 per share to a non-related party in exchange for their agreement to settle a payable balance of $9,714 owed to them. The conversion was in full satisfaction of all outstanding amounts owed. The Company recorded a non-related party loss of $854 as other expense in the consolidated statements of operations. On April 21, 2020, the Company agreed to convert 36,560 shares of its common stock at $1.039 per share to a non-related party in exchange for their agreement to settle a payable balance of $38,000 owed to them. The conversion was in full satisfaction of all outstanding amounts owed. The Company recorded a non-related party loss of $37,270 as other expense in the consolidated statements of operations. |
PREFERRED STOCK
PREFERRED STOCK | 6 Months Ended |
Jun. 30, 2020 | |
PREFERRED STOCK | |
NOTE 11. PREFERRED STOCK | On November 20, 2015, the Company’s Board of Directors authorized a class of stock designated as preferred stock with a par value of $0.00001 per share comprising 25,000,000 shares, 3,000,000 shares of which were classified as Series A Convertible Preferred Stock. In each calendar year, the holders of the Series A Convertible Preferred Stock are entitled to receive, when, as and if, declared by the Board of Directors, out of any funds and assets of the Company legally available, non-cumulative dividends, in an amount equal to any dividends or other Distribution on the common stock in such calendar year (other than a Common Stock Dividend). No dividends (other than a Common Stock Dividend) shall be paid and no distribution shall be made with respect to the common stock unless dividends shall have been paid or declared and set apart for payment to the holders of the Series A Convertible Preferred Stock simultaneously. Dividends on the Series A Convertible Preferred Stock shall not be mandatory or cumulative, and no rights or interest shall accrue to the holders of the Series A Convertible Preferred Stock by reason of the fact that the Company shall fail to declare or pay dividends on the Series A Convertible Preferred Stock, except for such rights or interest that may arise as a result of the Company paying a dividend or making a distribution on the common stock in violation of the terms. The holders of each share of Series A Convertible Preferred Stock then outstanding shall be entitled to be paid, out of the Available Funds and Assets, and prior and in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of common stock, and equal in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of any other series of preferred stock that have liquidation preference, an amount per share equal to the Original Issue Price of the Series A Convertible Preferred Stock plus all declared but unpaid dividends on the Series A Convertible Preferred Stock. A reorganization, or any other consolidation or merger of the Company with or into any other corporation, or any other sale of all or substantially all of the assets of the Company, shall not be deemed a liquidation, dissolution, or winding up of the Company. Shares of the Series A Convertible Preferred Stock are convertible at a 35% discount rate to the average closing price per share of the Company’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion. However, no conversions of the Series A Convertible Preferred Stock to shares of common stock can occur unless the average closing price per share of the Corporation’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion is at least $1.67. The shares of Series A Convertible Preferred Stock vote on a one for one basis. The right of conversion is limited by the fact the holder of the Series A Convertible Preferred Stock may not convert if such conversion would cause the holder to beneficially own more than 4.9% of the Company’s common stock after giving effect to such conversion. On August 8, 2019, the Company entered into an 8% Series A-1 Convertible Preferred Stock Investment Agreement (the “Investment Agreement”) with First Capital Ventures, LLC (“FCV”), and its assignee. The Company desires to raise between $1,000,000 and $2,000,000 from the sale of its 8% Series A-1 Convertible Preferred Stock and FCV intends to raise between $1,000,000 and $2,000,000 (net after offering expenses) in a special purchase vehicle (“SPV”) created by FCV to purchase the 8% Series A-1 Convertible Preferred Stock. The Company granted FCV and its assigns, the exclusive right to purchase the 8% Series A-1 Convertible Preferred Stock. The Company also agreed to cancel all shares of its previously issued and outstanding Series A Convertible Preferred Stock immediately following the closing date. The Company further agreed to issue FCV a three-year stock warrant to purchase 144,317 shares of its common stock at an exercise price of $ 1.039375 per share immediately following the closing date, which was valued at $122,889 and expensed upon grant for services provided. The Company agreed to enter into a “business development” agreement with FCV, or its assignee, on the sale of the first $1,000,000 of 8% Series A-1 Convertible Preferred Stock and also granted FCV and its assigns, the right to use the name “SOBR SAFE” and any related intellectual property in connection with the SPV, and the offering of the Interests in the SPV. In accordance with the August 8, 2019 Investment Agreement with FCV, on December 9, 2019, the Company’s Board of Directors created a class of preferred stock designated as 8% Series A-1 Convertible Preferred Stock comprising of 2,000,000 shares. The rights and preferences of the 8% Series A-1 Convertible Preferred Stock are as follows: (a) dividend rights of 8% per annum based on the original issuance price of $1 per share, (b) liquidation preference over the Company’s common stock, (c) conversion rights into shares of the Company’s common stock at $1 per share (not to be affected by any reverse stock split in connection with the Asset Purchase Agreement with IDTEC), (d) redemption rights such that we have the right, upon 30 days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price, (e) no call rights by the Company, and (f) each share of Series A-1 Convertible Preferred Stock will vote on an “as converted” basis. On December 12, 2019, the Company entered into a Series A-1 Preferred Stock Purchase Agreement (the “SPA”) with SOBR SAFE, LLC (“SOBR SAFE”), a Delaware limited liability company and an entity controlled by Gary Graham, one of our Directors, under which SOBR SAFE agreed to acquire 1,000,000 shares of our Series A-1 Convertible Preferred Stock (the “Preferred Shares”), in exchange for $1,000,000 (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019. In connection with the closing of the SPA, holders of the Company’s common stock representing approximately 52% of the Company’s then-outstanding common stock and voting rights signed irrevocable proxies to Gary Graham and/or Paul Spieker for the purpose of allowing Mr. Graham and/or Mr. Spieker to vote those shares on any matters necessary to close the transaction that is the subject of the certain Asset Purchase Agreement with IDTEC dated May 6, 2019, as amended. As of June 30, 2020 and December 31, 2019, the Company has sold 1,770,000 and 1,000,000 shares of its 8% Series A-1 Convertible Preferred Stock, respectively, but has not issued any stock certificates yet. The Series A-1 Convertible Preferred Stock earns cumulative dividends at a rate of 8% per annum, payable in cash or common stock at the option of the Company on June 30 and December 31 of each year. If paid in common stock, the common stock will be valued at the average of the closing price for the five business days prior to the dividend payment date. The preferred shareholders will participate in any common stock dividends on an as converted basis. During the six month period ended June 30, 2020 and 2019, no dividends have been declared for holders of the 8% Series A-1 Convertible Preferred Stock. |
STOCK WARRANTS AND STOCK OPTION
STOCK WARRANTS AND STOCK OPTIONS | 6 Months Ended |
Jun. 30, 2020 | |
STOCK WARRANTS AND STOCK OPTIONS | |
NOTE 12. STOCK WARRANTS AND STOCK OPTIONS | Stock Warrants The Company accounts for employee stock options and non-employee stock warrants under ASC 718 and ASC 505, whereby option costs are recorded based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable, utilizing the Black Sholes pricing model. Unless otherwise provided for, the Company covers option exercises by issuing new shares. Beginning on December 12, 2012, Michael A. Lanphere, a related party and non-employee, loaned the Company money for a variety of purposes, some for working capital and some to allow the Company to pay outstanding obligations. Each of these loans was made pursuant to the terms of a Loan Agreement with Promissory Note and Stock Fee (the “Agreements”). Under the terms of the Agreements, Mr. Lanphere was not only entitled to repayment of the principal amount loaned to us, with interest, but also what was termed in the Agreements as a “Stock Fee” that the parties are interpreting as a stock warrant, which permits Mr. Lanphere to acquire shares of our common stock in exchange for an exercise price that was estimated based on the date of the loan agreement. The number of shares to be issued to Mr. Lanphere as a Stock Fee under each Agreement was an estimate and varied based on the loan amount and the price of our common stock on the day of the loan and was calculated by this formula: 60% or 80% of the loan amount divided by the Company’s stock price on the day of the loan, but at a price per share no higher than $0.025. Each Stock Fee is fully vested immediately and expires 5 years from the date of the loan. Although the Stock Fee could be taken by Mr. Lanphere as a stock grant or a stock warrant, due to the fully vested nature of the Stock Fee, Mr. Lanphere is deemed to beneficially own those shares on the date of each Agreement. After the Company entered into a Debt Conversion and Common Stock Purchase Plan with Mr. Lanphere dated January 3, 2020, Mr. Lanphere agreed to exercise his stock warrants and the Company agreed to convert and issue 454,097 shares of its common stock to reduce a notes payable principal balance consisting of two notes in the amount of $65,875. The Company did not record a loss on debt extinguishment for this conversion pursuant to ASC 470-20-40-4 that states that upon conversion in accordance with its original terms, the carrying amount of the convertible debt without a BCF, including any unamortized premium or discount, is credited to the capital accounts and no gain or loss should be recognized. Mr. Lanphere owns no more warrants to shares of our common stock. The number of warrants outstanding to Mr. Lanphere at June 30, 2020 and December 31, 2019 were none and 454,097, respectively. On August 8, 2019, the Company entered into an 8% Series A-1 Convertible Preferred Stock Investment agreement with First Capital Ventures, LLC (“FCV”). FCV set up a special purpose vehicle (“SPV”) that purchased 1,000,000 of the 8% Series A-1 Convertible Preferred Shares at $1.00 per share on December 12, 2019. Upon purchase, the Company issued the SPV through FCV a three-year warrant to purchase 144,317 shares of the Company’s common stock at an exercise price of $1.039375 per share. The number of warrants outstanding to the SPV through FCV at June 30, 2020 and December 31, 2019 are 144,317 and 144,317, respectively. On June 5, 2020, at closing of the Transaction, the Company entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement under which we issued warrants to IDTEC to purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share. The warrants expire five years after the date of issuance. The total outstanding balance of all non-employee stock warrants in the Company is 464,317 and 598,414 at June 30, 2020 and December 31 2019, respectively. There were 320,000 non-employee detached free-standing stock warrants granted during the six month period ended June 30, 2020 and 498,562 non-employee detached free-standing stock warrants granted during the six month period ended June 30, 2019. The relative fair value of these non-employee stock warrants granted during the six month period ended June 30, 2020 and 2019 totaled $695,454 and $35,030, respectively, and were determined using the Black-Sholes option pricing model based on the following assumptions: June 30, 2020 June 30, 2019 Exercise Price $ 0.50 $ 0.06 - 0.2 Dividend Yield 0 % 0 % Volatility 153 % 135% - 138 % Risk-free Interest Rate 0.29 % 2.31% – 2.53 % Life of Warrants 5 Years 5 Years The following table summarizes the changes in the Company’s outstanding warrants during the six month period ended June 30, 2020 and 2019, and as of June 30, 2020 and 2019: Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2018 721,678 $ 0.1397 - 0.6319 3.45 Years $ 0.1929 $ - Warrants Granted 498,562 $ 0.06 - 0.2062 4.72 Years $ 0.1064 $ 22,428 Warrants Exercised - - Warrants Expired 1,503 $ 0.6319 $ 0.6319 Balance at June 30, 2019 1,218,737 $ 0.06 - 0.6319 3.68 Years $ 0.1596 $ - Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 598,414 $ 0.13304–1.039375 3.97 Years $ 0.3607 $ 1,276,870 Warrants Granted 320,000 $ 0.50 4.93 Years $ 0.50 $ 768,000 Warrants Exercised (454,097 ) $ 0.13304-0.15299 $ 0.7143 Warrants Expired - Balance at June 30, 2020 464,317 $ 0.50-1.039375 4.16 Years $ 0.66765 $ 1,036,521 Exercisable at December 31, 2019 598,414 $ 0.13304 – 1.039375 3.97 Years $ 0.3607 $ 1,276,870 Exercisable at June 30, 2020 464,317 $ 0.050 - 1.039375 4.16 Years $ 0.66765 $ 1,036,521 Stock Options On October 24, 2019, the Company’s 2019 Equity Incentive Plan went effective. The plan was approved by the Company’s Board of Directors and the holders of a majority of the Company’s voting stock on September 9, 2019. The plan’s number of authorized shares is 3,848,467. As of June 30, 2020 and December 31, 2019, the Company granted stock options to acquire 2,521,239 and 2,381,239 shares of common stock under the plan, respectively. As of June 30, 2020, the plan has 1,040,355 vested shares and 1,480,884 non-vested shares. As of December 31, 2019, the plan had 539,847 vested shares and 1,841,392 non-vested shares. The stock options are held by our officers, directors, and certain key consultants. In total for the six months ended June 30, 2020 and 2019, the Company recorded $296,932 and none, respectively, of share-based compensation expense related to the stock options. The unrecognized compensation expense as of June 30, 2020 was approximately $348,000 for non-vested share-based awards to be recognized over periods of approximately three to seven years. The fair value of the stock options granted during the six month period ended June 30, 2020 was determined using the Black-Sholes option pricing model based on the following assumptions: exercise price $2, dividend yield 0%, volatility 153%, risk-free interest rate 0.29%, life of options 5 years. The following table summarizes the changes in the Company’s outstanding stock options during the six month period ended June 30, 2020 and 2019, and as of June 30, 2020 and 2019. Options Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2018 53,367 $ 0.1497 – 8.31 2.32 Years $ 0.2761 $ - Options Granted - - Options Exercised - - Options Cancelled 45,100 $ 0.1497 $ 0.1497 Options Expired - - Balance at June 30, 2019 8,267 $ 0.2328 – 8.31 0.32 Years $ 0.9678 $ - Options Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 2,381,239 $ 0.2634 - 1.039 8.86 Years $ 0.2946 $ 5,238,080 Options Granted 140,000 $ 0.2634 – 2 4.54 Years $ 1.7504 $ 160,732 Options Exercised - - Options Cancelled - - Options Expired - - Balance at June 30, 2020 2,521,239 $ 0.26342 – 2 8.15 Years $ 0.3170 $ 6,512,360 Exercisable at December 31, 2019 539,847 $ 0.2634 – 1.03938 8.93 Years $ 0.4 $ 1,129,786 Exercisable at June 30, 2020 1,040,355 $ 0.26342 – 2 8.93 Years $ 0.5359 $ 2,459,933 Executive Stock Options The Company has 660,119 outstanding executive stock options exercisable at $0.2634 per share as of June 30, 2020 and 299,317 outstanding executive stock options as of December 31, 2019. On October 25, 2019, the Company granted Charles Bennington, one of the Company’s directors, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a one-year period commencing January 1, 2020. The stock options have a five-year term. A total of 12,027 and 0 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020. On October 25, 2019, the Company granted Nick Noceti, the former Company’s Chief Financial Officer, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a two-year period commencing January 1, 2020. The stock options have a five-year term. A total of 6,013 and 0 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020. On October 25, 2019, the Company granted Gary Graham, one of the Company’s directors, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a one-year period commencing January 1, 2020. The stock options have a five-year term. A total of 12,027 and 0 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020. On October 25, 2019, the Company entered into an Employment Agreement with Kevin Moore to serve as the Company’s Chief Executive Officer. Under the terms of the agreement, the Company granted Kevin Moore stock options under its 2019 Equity Compensation Plan to acquire 1,058,328 shares of its common stock at an exercise price of $0.2634. The stock options vest in 36 equal monthly installments of 29,398 shares during the three-year term of his Employment Agreement. 176,388 stock options vested during the six month period ended June 30, 2020. A total of 235,184 and 58,796 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020 or December 31, 2019. On October 25, 2019, the Company entered into an Employment Agreement with David Gandini to serve as the Company’s Chief Revenue Officer. Under the terms of the agreement, the Company granted David Gandini stock options under its 2019 Equity Compensation Plan to acquire 721,588 shares of its common stock at an exercise price of $0.2634. The stock options vest in 36 equal monthly installments of 20,044 shares during the three-year term of his Employment Agreement. David Gandini was also granted an aggregate of 240,529 additional option shares (the “Pre-Vesting Option Shares”) to vest as follows: (i) 200,439 Pre-Vesting Option Shares representing the monthly vesting option shares for the ten months ended October 31, 2019 to vest on November 1, 2019; and (ii) the remaining 40,090 Pre-Vesting Option Shares representing the monthly vesting option shares for the two months ended December 31, 2019 shall vest on January 1, 2020. The stock options have a ten-year term. 160,361 stock options vested during the six month period ended June 30, 2020. A total of 400,882 and 240,521 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020 or December 31, 2019. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 13. COMMITMENTS AND CONTINGENCIES | Operating Leases The Company leased office space under a long-term operating lease that expired in June 2019. The Company leased the same office space on a month to month basis until December 31, 2019. On October 15, 2019, the Company entered into a short-term lease agreement with Highland School that is between $2,800 - $2,900 per month and ends on October 31, 2020. The Company also leases an office space for $1,300 per month on a short-term (month to month) basis through a related party that terminates at any time. Rent expense under office leases, including CAM charges, was $42,348 and $26,210 for the six month period ended June 30, 2020 and 2019, respectively. Legal Proceedings On December 6, 2006, Orange County Valet and Security Patrol, Inc. filed a lawsuit against us in Orange County California State Superior Court for Breach of Contract in the amount of $11,164. A default judgment was taken against us in this matter. In mid-2013 we learned the Plaintiff’s perfected the judgment against us, but we have not heard from the Plaintiffs as of August 2020. We currently have one outstanding judgment against us involving a past employee of the Company. The matter is under the purview of the State of California, Franchise Tax Board, Industrial Health and Safety Collections. We currently owe approximately $28,786, plus accrued interest, to our ex-employee for unpaid wages under these Orders and we are working to get this amount paid off. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 14. SUBSEQUENT EVENTS | Between July 1, 2020 and August 3, 2020, the Company sold 953,000 shares of the Company’s 8% Series A-1 Convertible Preferred Stock to SOBR Safe, LLC, pursuant to the Investment Agreement by and between the Company and SOBR Safe, LLC (as designee of First Capital Ventures, LLC) dated August 8, 2019, as amended, and a corresponding Series A-1 Preferred Stock Purchase Agreement. The shares were sold for $1 per share for a total purchase price of $953,000. |
ORGANIZATION, OPERATIONS AND _2
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended December 31, 2019, included in the Company’s Annual Report on Form 10-K filed with the SEC on April 17, 2020. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2020 and December 31, 2019, and results of operations for the three month and six month periods ended June 30, 2020 and 2019. |
Principles of consolidation | The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiary, TransBiotec-CA. We have eliminated all intercompany transactions and balances between entities consolidated in these unaudited condensed financial statements. |
Use of Estimates | The preparation of unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the valuation of the derivative liabilities, beneficial conversion feature expenses and intellectual technology. Actual results could differ from those estimates. |
Cash | The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. The Company does not have any cash equivalents as of June 30, 2020 and December 31, 2019. |
Financial Instruments | Pursuant to Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures Financial Instruments Level Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets: quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company’s financial instruments consist primarily of cash, accounts payable, accrued expenses, accrued interest payable, notes payable, related party payables, convertible debentures, and other payables. Pursuant to ASC 820 and 825, the fair value of our derivative liabilities is determined based on “Level 3” inputs. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations. The following table presents assets and liabilities that are measured and recognized at fair value as of June 30, 2020 and December 31, 2019: June 30, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 $ - $ - $ 60,650 |
Beneficial Conversion Features | From time to time, the Company may issue convertible notes that may contain a beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid-in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method. |
Derivative Instruments | The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instruments are initially recorded at their fair values and are then re-valued at each reporting date, with changes in the fair value reported in the unaudited condensed consolidated statements of operations under other income (expense). The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option at its fair value as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As a result of entering into warrant agreements, for which such instruments contained a variable conversion feature with no floor, the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 whereby all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation issued to employees or directors. For stock-based derivative financial instruments, the Company uses a Monte Carlo Simulation model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. |
Preferred Stock | We apply the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any), which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity. |
Minority Interest (Noncontrolling Interest) | A subsidiary of the Company has minority members representing ownership interests of 1.38% at June 30, 2020 and December 31, 2019. The Company accounts for these minority, or noncontrolling interests, pursuant to ASC 810-10-65 whereby gains and losses in a subsidiary with a noncontrolling interest are allocated to the noncontrolling interest based on the ownership percentage of the noncontrolling interest, even if that allocation results in a deficit noncontrolling interest balance. |
Stock based compensation | The Company follows the guidance of the accounting provisions of ASC 718 Share-based Compensation, which requires the use of the fair-value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (warrants and options). The fair value of each option award is estimated on the date of grant using the Black-Scholes options-pricing model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. The Company has not paid dividends historically and does not expect to pay them in the future. Expected volatilities are based on weighted averages of the historical volatility of the Company’s common stock estimated over the expected term of the options. The expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term as historically the Company had limited activity surrounding its options. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term. In applying the Black-Scholes options-pricing model, assumptions used were as follows: Dividend yield 0 % Expected volatility 133% - 171 % Risk free interest rate 0.43% - 1.70 % Expected life 1.5 - 7.17 years |
Research and Development | The Company accounts for its research and development costs pursuant to ASC 730, whereby it requires the Company to disclose the amounts of costs for company and customer-sponsored research and development activities, if material. Research and development costs are expensed as incurred. The Company incurred research and development costs as it acquired new knowledge to bring about significant improvements in the functionality and design of its SOBR product. Research and development costs were $157,280 and none during the six month periods ended June 30, 2020 and June 30, 2019, respectively. |
Income tax | The Company accounts for income taxes pursuant to Accounting Standards Codification ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has not recorded any deferred tax assets or liabilities at June 30, 2020 and December 31, 2019, respectively. |
Net loss per share | The basic and fully diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding. |
Related Parties | Related parties are any entities or individuals that, through employment, ownership or other means, possess the ability to direct or cause the direction of the management and policies of the Company. |
New Pronouncements | In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) Codification Improvements to Leases (Topic 842): Amendments to the FASB Accounting Standards Codification. Management adopted the provisions of this statement and took them into account in the preparation of the financial statements for the year ended December 31, 2019. The Company has only short-term leases and has elected to utilize the practical expedient and as a result, has not recognized a right of use asset or related liability on its balance sheet. In July 2017, the FASB issued ASU-2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Noncontrolling Interests of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception The effective date for ASU 2017-11 is for annual or any interim periods beginning after December 15, 2018. In March 2018, the FASB issued ASU 2018-05, Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendments in this update provide guidance on when to record and disclose provisional amounts for certain income tax effects of the Tax Cuts and Jobs Act (“Tax Reform Act”). The amendments also require any provisional amounts or subsequent adjustments to be included in net income from continuing operations. Additionally, this ASU discusses required disclosures that an entity must make with regard to the Tax Reform Act. This ASU is effective immediately as new information is available to adjust provisional amounts that were previously recorded. Management adopted the provisions of this statement and took them into account in the preparation of the financial statements for the year ended December 31, 2019. The Company currently has no revenue and only net operating loss carryforwards that result in a tax benefit. The Company has no deferred tax assets (offset in full by a valuation allowance) or tax liabilities on its balance sheet as of June 30, 2020 and December 31, 2019. In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting In July 2019, the FASB issued ASU 2019-07, Codification Updates to SEC Sections Management adopted the provisions of this statement and took them into account in the preparation of the unaudited condensed consolidated financial statements, and it did not have a material impact on the Company’s reported consolidated financial results. In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes Income Taxes In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, |
ORGANIZATION OPERATIONS AND SUM
ORGANIZATION OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of fair value of assets and liabilities | June 30, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 $ - $ - $ 60,650 |
Schedule of assumption for risk free return | Dividend yield 0 % Expected volatility 133% - 171 % Risk free interest rate 0.43% - 1.70 % Expected life 1.5 - 7.17 years |
ASSET PURCHASE (Table)
ASSET PURCHASE (Table) | 6 Months Ended |
Jun. 30, 2020 | |
ASSET PURCHASE | |
Summary of closing transactions | Property and equipment $ 47,725 Intangible assets 29,175,230 Total assets $ 29,222,955 Net purchase (fair value of stock issued, warrants and funds spent) $ 29,222,955 |
PROPERTY AND EQUIPMENT (Table)
PROPERTY AND EQUIPMENT (Table) | 6 Months Ended |
Jun. 30, 2020 | |
PROPERTY AND EQUIPMENT | |
Summary of property plant and equipment | June 30, December 31, 2020 2019 Robotics and testing equipment $ 46,200 $ - Office furniture and equipment 45,208 43,683 91,408 43,683 Accumulated depreciation (44,788 ) (43,683 ) Property and equipment, net $ 46,620 $ - |
INTANGIBLE ASSETS (Table)
INTANGIBLE ASSETS (Table) | 6 Months Ended |
Jun. 30, 2020 | |
INTANGIBLE ASSETS | |
Schedule of estimated future amortization expense | 2021 2022 2023 2024 2025 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,895,218 |
Summary of Intangible Assets | Gross Carrying Accumulated Net Intangible Amortization Period Amount Amortization Asset (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 32,122 $ 3,822,553 10 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
NOTES PAYABLE | |
Schedule of notes payables - related parties | June 30, 2020 December 31, 2019 Convertible Notes Payable $ 1,485,189 $ 161,000 Conventional Non-Convertible Notes Payable 11,810 328,423 Notes Payable with Detached Free-standing Warrants - 280,119 Unamortized Discount - (8,656 ) Net Related Party Notes Payable $ 1,1496,999 $ 760,886 |
Schedule of notes payables - non related parties | June 30, 2020 December 31, 2019 Convertible Notes Payable $ 84,165 $ 143,136 Conventional Non-Convertible Notes Payable 56,683 21,438 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Unamortized Beneficial Conversion Feature - - Net Non-Related Party Notes Payable $ 145,848 $ 169,574 |
DERIVATIVE LIABILITY (Tables)
DERIVATIVE LIABILITY (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
DERIVATIVE LIABILITY | |
Schedule of activity of derivative liability | Balance at December 31, 2019 $ 60,650 Fair market value adjustments, including settlements (60,650 ) Balance at June 30, 2020 $ 0 |
STOCK WARRANTS AND STOCK OPTI_2
STOCK WARRANTS AND STOCK OPTIONS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
STOCK WARRANTS AND STOCK OPTIONS | |
Schedule of fair value of non-employee stock/warrants | June 30, 2020 June 30, 2019 Exercise Price $ 0.50 $ 0.06 - 0.2 Dividend Yield 0 % 0 % Volatility 153 % 135% - 138 % Risk-free Interest Rate 0.29 % 2.31% – 2.53 % Life of Warrants 5 Years 5 Years |
Schedule of outstanding warrants | Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2018 721,678 $ 0.1397 - 0.6319 3.45 Years $ 0.1929 $ - Warrants Granted 498,562 $ 0.06 - 0.2062 4.72 Years $ 0.1064 $ 22,428 Warrants Exercised - - Warrants Expired 1,503 $ 0.6319 $ 0.6319 Balance at June 30, 2019 1,218,737 $ 0.06 - 0.6319 3.68 Years $ 0.1596 $ - Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 598,414 $ 0.13304–1.039375 3.97 Years $ 0.3607 $ 1,276,870 Warrants Granted 320,000 $ 0.50 4.93 Years $ 0.50 $ 768,000 Warrants Exercised (454,097 ) $ 0.13304-0.15299 $ 0.7143 Warrants Expired - Balance at June 30, 2020 464,317 $ 0.50-1.039375 4.16 Years $ 0.66765 $ 1,036,521 Exercisable at December 31, 2019 598,414 $ 0.13304 – 1.039375 3.97 Years $ 0.3607 $ 1,276,870 Exercisable at June 30, 2020 464,317 $ 0.050 - 1.039375 4.16 Years $ 0.66765 $ 1,036,521 |
Schedule of outstanding options | Options Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2018 53,367 $ 0.1497 – 8.31 2.32 Years $ 0.2761 $ - Options Granted - - Options Exercised - - Options Cancelled 45,100 $ 0.1497 $ 0.1497 Options Expired - - Balance at June 30, 2019 8,267 $ 0.2328 – 8.31 0.32 Years $ 0.9678 $ - Options Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 2,381,239 $ 0.2634 - 1.039 8.86 Years $ 0.2946 $ 5,238,080 Options Granted 140,000 $ 0.2634 – 2 4.54 Years $ 1.7504 $ 160,732 Options Exercised - - Options Cancelled - - Options Expired - - Balance at June 30, 2020 2,521,239 $ 0.26342 – 2 8.15 Years $ 0.3170 $ 6,512,360 Exercisable at December 31, 2019 539,847 $ 0.2634 – 1.03938 8.93 Years $ 0.4 $ 1,129,786 Exercisable at June 30, 2020 1,040,355 $ 0.26342 – 2 8.93 Years $ 0.5359 $ 2,459,933 |
ORGANIZATION OPERATIONS AND S_2
ORGANIZATION OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Derivative liabilites | $ 0 | $ 60,650 |
Office furniture and equipment [Member] | ||
Derivative liabilites | 0 | 0 |
Fair value assets and liabilities | 0 | 0 |
Level 1 [Member] | ||
Derivative liabilites | 0 | 0 |
Fair value assets and liabilities | 0 | 0 |
Level 3 [Member] | ||
Derivative liabilites | 0 | 60,650 |
Fair value assets and liabilities | $ 0 | $ 60,650 |
ORGANIZATION OPERATIONS AND S_3
ORGANIZATION OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 6 Months Ended |
Jun. 30, 2020 | |
Dividend yield | 0.00% |
Minimum [Member] | |
Expected volatility | 133.00% |
Risk free interest rate | 0.43% |
Expected life | 1 year 5 months 30 days |
Maximum [Member] | |
Expected life | 7 years 2 months 1 day |
Expected volatility | 171.00% |
Risk free interest rate | 1.70% |
ORGANIZATION OPERATIONS AND S_4
ORGANIZATION OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
May 21, 2020 | Mar. 23, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Research and development costs | $ 89,570 | $ 0 | $ 157,280 | $ 0 | |||
Noncontrolling ownership interest | 1.38% | 1.38% | 1.38% | ||||
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||
Common stock, par value | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||
Annual Meeting of Shareholders [Member] | |||||||
Common stock, shares authorized | 100,000,000 | 800,000,000 | |||||
Common stock, par value | $ 0.00001 | $ 0.00001 | |||||
Description of reverse stock split | The effective dates of the above actions were June 5, 2020 and April 20, 2020, respectively, and the actual reverse stock split ratio was 1-for-33.26. | Reverse stock split of the Company’s outstanding common stock at a ratio between 1-for-32 and 1-for-35 (with the exact ratio to be determined by the directors in their sole discretion without further approval by the shareholders). |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | Dec. 12, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Nov. 20, 2015 |
Accumulated deficit | $ (47,672,155) | $ (19,511,168) | |||
Net cash used in operating activities | $ (765,791) | $ (168,908) | |||
Preferred stock, shares authorized | 25,000,000 | ||||
Common stock per share | $ 0.00001 | $ 0.00001 | |||
SOBR SAFE, LLC [Member] | Asset purchase agreement [Member] | |||||
Redemption rights description | Redemption rights such that the Companyhas the right, upon thirty days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price | ||||
Business acquisition, purchase price | $ 1,000,000 | ||||
Business acquisition, shares issued | 1,000,000 | ||||
Preferred stock, shares authorized | 2,000,000 | ||||
Business acquisition, original issuance price | $ 1 | ||||
Common stock per share | $ 1 | ||||
Business acquisition, dividend rights | 8.00% | ||||
Cash acquired from acquisition | $ 727,633 | $ 681,759 |
ASSET PURCHASE (Details)
ASSET PURCHASE (Details) | Jun. 05, 2020USD ($) |
ASSET PURCHASE | |
Property and equipment, gross | $ 47,725 |
Intangible assets | 29,175,230 |
Total assets | 29,222,955 |
Net purchase (fair value of stock issued, warrants and funds spent) | $ 29,222,955 |
ASSET PURCHASE (Details Narrati
ASSET PURCHASE (Details Narrative) - USD ($) | Jun. 05, 2020 | Jun. 30, 2020 | Jun. 30, 2020 |
Liability required | $ 125,000 | $ 158,000 | $ 158,000 |
Exercise price per share | $ 0.50 | ||
Assets purchase upon shares issued | 29,222,955 | 1,407,051 | 1,407,051 |
Assets purchase upon shares issued, shares | 12,000,000 | ||
Common stock issuable upon exercise of warrant, shares | 320,000 | ||
Asset impairment loss | $ 25,320,555 | ||
Fair value of warrants issued | $ 695,454 | $ 695,454 | |
Description of fair value of assets evaluation | The Company evaluated the fair value of the assets acquired based on market estimates for property and equipment and discounted net cash flow for the SOBR Safe intellectual technology. The present value of the discounted cash flow utilized a 75% discount, which included a 25% risk return premium, over an estimated five-year net revenue stream expected to be derived from the technology acquired. | ||
Asset Purchase Agreement [Member] | IDTEC [Member] | |||
Common stock, shares issued upon assets purchase | 12,000,000 | 12,000,000 | |
Convertible notes, conversion price | $ 0.50 | $ 0.50 | |
Interest rate | 10.00% | ||
Convertible Notes Payable | $ 1,485,189 | $ 1,485,189 | |
Agreement Description | i) The Company had to be current inreporting requirements under the Securities Exchange Act of 1934, as amended, (ii) had to complete a reverse stock split of common stock such that approximately 8,000,000 shares were outstanding immediately prior to closing the transaction, (iii) could only have outstanding convertible instruments as set forth in the APA, (iv) authorized common stock had to be reduced to 100,000,000 shares, and (v) not have more than approximately $125,000 in current liabilities. |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Property and equipment, gross | $ 91,408 | $ 43,683 |
Accumulated depreciation | (44,788) | (43,683) |
Property and equipment, net | 46,620 | 0 |
Office furniture and equipment [Member] | ||
Property and equipment, gross | 45,208 | 43,683 |
Robotics and testing equipment [Member] | ||
Property and equipment, gross | $ 46,200 | $ 0 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Depreciation | $ 1,105 | $ 1,105 |
Property, Plant and Equipment [Member] | ||
Estimated useful life | 3 years |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - Intellectual Technology [Member] | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Amortization Period | 1000.00% |
Intangible assets, gross | $ 3,854,675 |
Accumulated amortization | 32,122 |
Intangible assets, net | $ 3,822,553 |
INTANGIBLE ASSETS (Details 1)
INTANGIBLE ASSETS (Details 1) | Jun. 30, 2020USD ($) |
INTANGIBLE ASSETS | |
2021 | $ 385,467 |
2022 | 385,467 |
2023 | 385,467 |
2024 | 385,467 |
2025 | 385,467 |
Thereafter | $ 1,895,218 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
INTANGIBLE ASSETS | ||
Amortization expense | $ 32,122 | $ 32,122 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Apr. 07, 2020 | Apr. 06, 2020 | Jan. 03, 2020 | Jul. 02, 2015 | Dec. 03, 2014 | Nov. 01, 2014 | Mar. 23, 2020 | Jan. 30, 2020 | Jan. 16, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Mar. 08, 2017 | Jul. 01, 2015 |
Outstanding accounts payable conversion percentage into common stock | 50.00% | |||||||||||||||
Common stock conversion price | $ 0.09 | |||||||||||||||
Attorney fees and costs | $ 214,334 | |||||||||||||||
Legal fees in accounts payable, percentages | 50.00% | |||||||||||||||
Attorney fees and costs, percentages | 50.00% | |||||||||||||||
Exercise price | $ 112,871 | |||||||||||||||
Debt amount after debt forgiveness | $ 31,662 | |||||||||||||||
Acquired shares | 969,601 | |||||||||||||||
Note payable amount | $ 74,672 | $ 74,672 | $ 74,672 | |||||||||||||
Gain on related party debt conversion | 297,711 | $ 0 | 269,144 | $ 0 | ||||||||||||
Accrued interest | $ 393,882 | 393,882 | $ 419,836 | |||||||||||||
Related party payables converted to capital | $ 579,814 | 0 | ||||||||||||||
Common stock, shares issued | 20,046,424 | 20,046,424 | 6,452,993 | |||||||||||||
Charles Bennington [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 2,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 6,831 | |||||||||||||||
Reduction in related party debt | $ 9,656 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 1.41 | |||||||||||||||
Purchase price of shares issued | $ 9,656 | |||||||||||||||
Nick Noceti [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 49,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 38,437 | |||||||||||||||
Reduction in related party debt | $ 127,480 | $ 127,480 | ||||||||||||||
Purchase price of shares issued | 127,840 | 127,840 | ||||||||||||||
Prakash Gadgil [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 1,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 586 | |||||||||||||||
Reduction in related party debt | $ 1,950 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | |||||||||||||||
Purchase price of shares issued | $ 1,950 | |||||||||||||||
Devdatt Mishal [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 144,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 499,965 | |||||||||||||||
Reduction in related party debt | $ 270,300 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 0.91465 | |||||||||||||||
Purchase price of shares issued | $ 456,641 | |||||||||||||||
Accrued interest | $ 186,500 | |||||||||||||||
Lanphere Law Group [Member] | December 3 2014 [Member] | ||||||||||||||||
Accrued interest | $ 38,199 | |||||||||||||||
Debt amount | $ 74,672 | |||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 108,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 9,520 | |||||||||||||||
Reduction in related party debt | $ 65,875 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | |||||||||||||||
Accrued interest | $ 428,668 | 0 | 0 | $ 9,508 | ||||||||||||
Debt amount | $ 214,334 | |||||||||||||||
Debt instrument principal value, after forgivness | $ 31,662 | $ 0 | 0 | $ 31,662 | 106,335 | |||||||||||
Due date notes payable | Dec. 2, 2015 | |||||||||||||||
Debt Instrument, Forgiveness | $ 108,000 | |||||||||||||||
Acquired additional shares of common stock | 454,097 | |||||||||||||||
Related party payables converted to capital | $ 0 | $ 15,522 | ||||||||||||||
Purchase price of additional shares of common stock | $ 65,875 | |||||||||||||||
Common stock, shares, new issue | 180,397 | |||||||||||||||
Common stock, shares issued | 273,700 | |||||||||||||||
Conversion price | $ 0.133 | |||||||||||||||
Common stock issued price per share | $ 0.153 | |||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan Three [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 222,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 214,883 | |||||||||||||||
Reduction in related party debt | $ 714,700 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | |||||||||||||||
Purchase price of shares issued | $ 714,700 | |||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan Two [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 52,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 63,225 | |||||||||||||||
Reduction in related party debt | $ 169,606 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | |||||||||||||||
Purchase price of shares issued | $ 210,285 | |||||||||||||||
Accrued interest | 40,679 | |||||||||||||||
Vemon Justus [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||
Gain on related party debt conversion | $ 70,000 | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 84,963 | |||||||||||||||
Reduction in related party debt | $ 180,001 | |||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | |||||||||||||||
Purchase price of shares issued | $ 282,588 | |||||||||||||||
Accrued interest | $ 102,587 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Conventional Non-Convertible Notes Payable | $ 84,165 | $ 21,438 |
Net Related Party Notes Payable | 31,590 | 905,443 |
Related Party Notes Payable [Member] | ||
Convertible Notes Payable | 1,485,189 | 161,000 |
Conventional Non-Convertible Notes Payable | 11,810 | 328,423 |
Notes Payable with Detached Free-standing Warrants | 0 | 280,119 |
Unamortized Discount | 0 | (8,656) |
Net Related Party Notes Payable | $ 11,496,999 | $ 760,886 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Net Non-Related Party Notes Payable | $ 74,672 | $ 74,672 |
Non-Related Party Notes Payable [Member] | ||
Convertible Notes Payable | 84,165 | 143,136 |
Conventional Non-Convertible Notes Payable | 56,683 | 21,438 |
Notes Payable with Detached Free-standing Warrants | 5,000 | 5,000 |
Unamortized Discount | 0 | 0 |
Net Non-Related Party Notes Payable | $ 145,848 | $ 169,574 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Jun. 09, 2020 | May 12, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Jan. 03, 2020 | Dec. 31, 2019 | |
Interest expense for non-related party notes | $ 10,885 | $ 28,762 | |||||||
Interest expenses for related party notes | 42,161 | 43,235 | |||||||
Conventional Non-Convertible Notes Payable | $ 84,165 | 84,165 | $ 21,438 | ||||||
Accrued interest | 126,417 | 126,417 | 674,041 | ||||||
Convertible notes payable principal | 145,848 | 145,848 | 169,574 | ||||||
Gain on related party debt conversion | 297,711 | $ 0 | 269,144 | 0 | |||||
Fair value of embedded conversion feature | 0 | 56,100 | |||||||
Non-Related Party Notes Payable One [Member] | |||||||||
Convertible Notes Payable | 47,500 | $ 47,500 | |||||||
Interest rate | 5.00% | ||||||||
Accrued interest | 22,500 | $ 22,500 | |||||||
Convertible non-related party note payable | $ 25,000 | $ 25,000 | |||||||
Convertible notes, conversion price | $ 2 | $ 2 | |||||||
Gain on related party debt conversion | $ 11,697 | ||||||||
Non-Related Party Notes Payable [Member] | |||||||||
Convertible Notes Payable | $ 56,683 | 56,683 | 143,136 | ||||||
Accrued interest | 82,797 | 82,797 | |||||||
Common stock shares exchanged | 20,313 | ||||||||
Gain on related party debt conversion | 68,000 | ||||||||
Amortization expenses, beneficial conversion feature | 5,356 | 5,356 | |||||||
Purchase price of shares issued | $ 166,749 | $ 166,749 | |||||||
Non-Related Party Notes Payable [Member] | Maximum [Member] | |||||||||
Interest rate | 30.00% | ||||||||
Note payable due date | Mar. 6, 2022 | ||||||||
Note payable conversion price per share | $ 10.76 | $ 10.76 | |||||||
Non-Related Party Notes Payable [Member] | Minimum [Member] | |||||||||
Interest rate | 5.00% | ||||||||
Note payable due date | Feb. 20, 2013 | ||||||||
Note payable conversion price per share | $ 1.99 | $ 1.99 | |||||||
Related Party Notes Payable [Member] | |||||||||
Conventional Non-Convertible Notes Payable | $ 11,810 | $ 11,810 | 328,423 | ||||||
Convertible Notes Payable | 1,485,189 | 1,485,189 | 161,000 | ||||||
Accrued interest | 52,119 | 52,119 | |||||||
Convertible notes payable principal | $ 91,000 | 91,000 | |||||||
Amortization expenses, beneficial conversion feature | $ 1,485,189 | 1,485,189 | |||||||
Default interest rate | 10.00% | 10.00% | |||||||
Fair value of embedded conversion feature | $ 0 | 56,000 | |||||||
Shares issued upon conversion of debt | 156,474 | ||||||||
Reduction in related party convertible notes | $ 143,119 | 143,119 | |||||||
Holder [Member] | |||||||||
Convertible promissory note | $ 25,000 | ||||||||
Convertible promissory note, interest rate | 30.00% | ||||||||
Accrued interest | 61,875 | 61,875 | |||||||
Related Party Notes Payable One [Member] | |||||||||
Note payable conversion price per share | $ 0.13304 | ||||||||
Related Party Notes Payable One [Member] | Warrant [Member] | |||||||||
Accrued interest | 40,739 | 40,739 | |||||||
Purchase price of shares issued | 320,858 | 320,858 | |||||||
Convertible Notes Payable | 280,119 | 280,119 | 280,119 | ||||||
Fair value of warrants granted | 35,030 | 35,030 | |||||||
Interest expense | 8,656 | $ 15,093 | |||||||
Unamortized Discount | $ 0 | $ 0 | $ 8,656 | ||||||
Number of detached free-standing warrants outstanding | 454,097 | 454,097 | 454,097 | ||||||
Related Party Notes Payable One [Member] | Warrant [Member] | Maximum [Member] | |||||||||
Interest rate | 10.00% | ||||||||
Note payable due date | Mar. 30, 2020 | ||||||||
Exercise price | $ 0.53 | $ 0.53 | |||||||
Related Party Notes Payable One [Member] | Warrant [Member] | Minimum [Member] | |||||||||
Interest rate | 7.00% | ||||||||
Note payable due date | May 8, 2015 | ||||||||
Exercise price | $ 0.03 | $ 0.03 | |||||||
New non-convertible note [Member] | |||||||||
Convertible Notes Payable | $ 47,500 | $ 47,500 | |||||||
Interest rate | 5.00% | ||||||||
Gain on non-related party debt extinguishment | $ 61,875 | ||||||||
Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | |||||||||
Convertible Notes Payable | 3,938 | $ 3,938 | |||||||
Interest rate | 10.00% | ||||||||
Accrued interest | 63,623 | $ 63,623 | |||||||
Gain on related party debt conversion | $ 39,000 | ||||||||
Note payable due date | Sep. 11, 2014 | ||||||||
Purchase price of shares issued | $ 67,561 | $ 67,561 | |||||||
Number of detached free-standing warrants outstanding | 5,000 | 5,000 | 5,000 | ||||||
Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | Maximum [Member] | |||||||||
Interest rate | 10.00% | ||||||||
Note payable due date | Jun. 6, 2022 | ||||||||
Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | Minimum [Member] | |||||||||
Interest rate | 1.00% | ||||||||
Note payable due date | Dec. 27, 2013 | ||||||||
Non-Convertible Notes Payable Two [Member] | |||||||||
Accrued interest | $ 232,698 | $ 232,698 | |||||||
Purchase price of shares issued | 549,311 | 549,311 | |||||||
Reduction in related party convertible notes | 316,613 | 316,613 | |||||||
Conventional Non-Convertible Notes Payable | 11,810 | 11,810 | $ 328,423 | ||||||
Convertible debt, conversion, principal amount | 316,613 | 316,613 | |||||||
Principal balance | $ 316,613 | ||||||||
Commercial Bank [Member] | SBA Payroll Protection Loan Program [Member] | |||||||||
Proceeds from loan | $ 41,665 | ||||||||
Loan interest rate | 1.00% | ||||||||
Description of loan interest | The loan requires interest at 1% and 18 monthly payments of principal and interest beginning December 5, 2020. | ||||||||
Common Stock Purchase Plans [Member] | Six Non-related Parties [Member] | |||||||||
Common stock shares exchanged | 50,135 | ||||||||
Common Stock Purchase Plans [Member] | Two Related Parties [Member] | |||||||||
Common stock shares exchanged | 601,783 | ||||||||
Convertible notes payable principal | 280,119 | 280,119 | |||||||
Common Stock Purchase Plans [Member] | Four Related Parties [Member] | |||||||||
Conventional Non-Convertible Notes Payable | 316,613 | 316,613 | |||||||
Accrued interest | 232,698 | 232,698 | |||||||
Common stock shares exchanged | 342,399 | ||||||||
Reduction in related party non - convertible notes payable | $ 549,311 | $ 549,311 |
DERIVATIVE LIABILITY (Details)
DERIVATIVE LIABILITY (Details) | 6 Months Ended |
Jun. 30, 2020USD ($) | |
DERIVATIVE LIABILITY | |
Beginning balance | $ 60,650 |
Fair market value adjustments, including settlements | (60,650) |
Ending balance | $ 0 |
DERIVATIVE LIABILITY (Details N
DERIVATIVE LIABILITY (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Risk-free interest rate | 0.13% | ||||
Expected volatility rate | 180.00% | ||||
Fair value of embeded derivative liability | $ 0 | $ 0 | $ 60,650 | ||
Gain on related party debt conversion | 297,711 | $ 0 | $ 269,144 | $ 0 | |
Minimum [Member] | |||||
Expected life | 1 year 5 months 30 days | ||||
Maximum [Member] | |||||
Expected life | 7 years 2 months 1 day | ||||
Convertible promissory note agreement [Member] | |||||
Fair market value gain | $ 60,650 | $ 3,200 | |||
Fair value of embeded derivative liability | 0 | 0 | 60,650 | ||
Beneficial conversion feature recorded as discount | 64,800 | $ 64,800 | |||
Gain on related party debt conversion | $ 273,642 | ||||
Convertible promissory note agreement [Member] | Minimum [Member] | |||||
Expected life | 1 month | ||||
Convertible promissory note agreement [Member] | Maximum [Member] | |||||
Expected life | 1 year | ||||
Convertible promissory note agreement [Member] | March 1, 2019 [Member] | |||||
Fair value of embeded derivative liability | 28,000 | $ 28,000 | |||
Convertible promissory note agreement [Member] | 2019 [Member] | |||||
Amount borrowed under debt instrument from unrelated party | $ 70,000 | $ 70,000 | |||
Interest rate | 10.00% | 10.00% | |||
Conversion price, description | Convertible into the Company’s common shares at a variable conversion price based on a 50% discount of the market price at an undetermined future date. | ||||
Convertible promissory note agreement [Member] | May 3, 2019 [Member] | |||||
Fair value of embeded derivative liability | $ 28,100 | $ 28,100 | |||
Convertible promissory note agreement [Member] | October 26, 2019 [Member] | |||||
Fair value of embeded derivative liability | $ 8,700 | $ 8,700 |
STOCK SUBSCRIPTIONS PAYABLE (De
STOCK SUBSCRIPTIONS PAYABLE (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Related Parties [Member] | |||
Gain (Loss) on stock subscription payable | $ 0 | $ 15,522 | |
Common stock subscription payable, shares | 89,077 | 89,077 | |
Common stock subscription payable, amount | $ 79,624 | $ 79,624 | |
Related Parties [Member] | 8% Series A-1 Convertible Preferred shares [Member] | |||
Preferred stock subscription payable, shares | 1,770,000 | 1,000,000 | |
Preferred stock subscription payable, amount | $ 1,770,000 | $ 1,000,000 | |
Non-Related Parties [Member] | |||
Common stock subscription payable, shares | 15,108 | ||
Common stock subscription payable, amount | $ 20,503 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | Mar. 15, 2020 | Jan. 03, 2020 | Apr. 21, 2020 | Apr. 20, 2020 | Apr. 07, 2020 | Apr. 06, 2020 | Mar. 23, 2020 | Mar. 20, 2020 | Jan. 30, 2020 | Jan. 22, 2020 | Jan. 16, 2020 | Feb. 25, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 |
Common stock shares issued for cash, value | $ 27,120,000 | $ 39,000 | ||||||||||||||||
Gain on related party debt conversion | 297,711 | $ 0 | $ 269,144 | $ 0 | ||||||||||||||
Common stock value | $ 201 | $ 201 | $ 65 | |||||||||||||||
Compensation [Member] | ||||||||||||||||||
Common stock shares issued for services, shares | 601 | |||||||||||||||||
Convertible notes, conversion price | $ 34.59 | |||||||||||||||||
Related Party Three [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | |||||||||||||||||
Gain on related party debt conversion | $ 56,518 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 282,588 | |||||||||||||||||
Debt conversion, converted instrument, shares issued | 84,963 | |||||||||||||||||
Related Party [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 0.1530 | $ 3.326 | $ 0.9146 | $ 3.326 | ||||||||||||||
Gain on related party debt conversion | $ 1,073 | $ 456,634 | $ 408,094 | |||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 41,875 | $ 1,950 | $ 456,641 | $ 714,700 | ||||||||||||||
Debt conversion, converted instrument, shares issued | 586 | 499,965 | 214,883 | |||||||||||||||
Number of stock warrants exercised | 273,700 | |||||||||||||||||
Other expenses | $ 143,660 | |||||||||||||||||
Related Party [Member] | Common Stock Purchase Agreement [Member] | ||||||||||||||||||
Gain on related party debt conversion | $ 2,035 | $ 48,707 | ||||||||||||||||
Common stock issued to settle notes payable | $ 9,656 | $ 127,840 | ||||||||||||||||
Common stock issued to settle accounts payable, shares | 6,831 | 38,437 | ||||||||||||||||
Common stock value | $ 7,621 | $ 79,133 | ||||||||||||||||
Non-Related Party [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | $ 3.326 | $ 1.039 | $ 3.326 | $ 3.326 | |||||||||||||
Gain on related party debt conversion | $ 19,240 | $ 6,907 | $ 854 | $ 14,289 | $ 22,840 | |||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 32,500 | $ 34,534 | $ 9,714 | $ 23,814 | $ 40,000 | |||||||||||||
Debt conversion, converted instrument, shares issued | 9,771 | 10,383 | 9,346 | 7,160 | 12,026 | |||||||||||||
Non-Related Party [Member] | April 1, 2020 [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ .5821 | $ .5821 | ||||||||||||||||
Gain on related party debt conversion | $ 43,743 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 43,750 | |||||||||||||||||
Debt conversion, converted instrument, shares issued | 75,165 | |||||||||||||||||
Related Party Two [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | |||||||||||||||||
Gain on related party debt conversion | $ 42,057 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 210,285 | |||||||||||||||||
Debt conversion, converted instrument, shares issued | 63,225 | |||||||||||||||||
Related Party One [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 0.13304 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 24,000 | |||||||||||||||||
Number of stock warrants exercised | 180,397 | |||||||||||||||||
Non-Related Parties [Member] | ||||||||||||||||||
Common stock shares issued for cash, shares | 1,065,982 | |||||||||||||||||
Common stock shares issued for cash, value | $ 39,000 | |||||||||||||||||
Debt instrument, convertible, conversion price | $ 1.039 | |||||||||||||||||
Gain on related party debt conversion | $ 37,270 | |||||||||||||||||
Common stock issued to settle notes payable | $ 38,000 | |||||||||||||||||
Common stock issued to settle accounts payable, shares | 36,560 | |||||||||||||||||
Non-Related Party Three [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | |||||||||||||||||
Gain on related party debt conversion | $ 19,525 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 97,624 | |||||||||||||||||
Debt conversion, converted instrument, shares issued | 29,352 | |||||||||||||||||
Non-Related Party Two [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | |||||||||||||||||
Gain on related party debt conversion | $ 7,871 | |||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 39,356 | |||||||||||||||||
Debt conversion, converted instrument, shares issued | 11,833 | |||||||||||||||||
Non-Related Party One [Member] | ||||||||||||||||||
Debt instrument, convertible, conversion price | $ 3.326 | $ 3.326 | ||||||||||||||||
Gain on related party debt conversion | $ 1,296 | $ 49,942 | ||||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 6,482 | $ 87,464 | ||||||||||||||||
Debt conversion, converted instrument, shares issued | 1,949 | 26,297 |
PREFERRED STOCK (Details Narrat
PREFERRED STOCK (Details Narratve) - USD ($) | 1 Months Ended | 6 Months Ended | |||||
Aug. 08, 2019 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 12, 2019 | Dec. 09, 2019 | Mar. 08, 2017 | Nov. 20, 2015 | |
Preferred stock, shares authorized | 25,000,000 | ||||||
Preferred stock, par value | $ 0.00001 | ||||||
Exercise price | $ 112,871 | ||||||
First Capital Ventures [Member] | |||||||
Issuane of warrants upon purchase of common stock, shares | 144,317 | ||||||
Issuane of warrants upon purchase of common stock, amount | $ 122,889 | ||||||
Exercise price | $ 1.039375 | ||||||
Business Development [Member] | |||||||
Agreement term | The Company agreed to enter into a “business development” agreement with FCV, or its assignee, on the sale of the first $1,000,000 of 8% Series A-1 Convertible Preferred Stock and also granted FCV and its assigns, the right to use the name “SOBR SAFE” and any related intellectual property in connection with the SPV, and the offering of the Interests in the SPV. | ||||||
Series A-1 Convertible Preferred stock [Member] | |||||||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | |||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | |||||
Purchase price from SPV, shares | 1,000,000 | ||||||
Preferred stock shares sold | 1,770,000 | 1,000,000 | |||||
Purchase price from SPV, amount | $ 1,000,000 | ||||||
Purchase price from SPV, percentage | 52.00% | ||||||
Series A-1 Convertible Preferred stock [Member] | Series A-1 Preferred Stock Purchase Agreement [Member] | SOBR SAFE, LLC [Member] | SOBR's Director company [Member] | |||||||
Preferred stock, shares authorized | 2,000,000 | ||||||
Right of dividend | 8.00% | ||||||
Shares issuance price | $ 1 | ||||||
Preferences and rights of preferred stock | (a) dividend rights of 8% per annum based on the original issuance price of $1 per share, (b) liquidation preference over the Company’s common stock, (c) conversion rights into shares of the Company’s common stock at $1 per share (not to be affected by any reverse stock split in connection with the Asset Purchase Agreement with IDTEC), (d) redemption rights such that we have the right, upon 30 days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price, (e) no call rights by the Company, and (f) each share of Series A-1 Convertible Preferred Stock will vote on an “as converted” basis | ||||||
Convertible Preferred Stock [Member] | Investment Agreement [Member] | |||||||
Raises fund description | The Company desires to raise between $1,000,000 and $2,000,000 from the sale of its 8% Series A-1 Convertible Preferred Stock and FCV intends to raise between $1,000,000 and $2,000,000 (net after offering expenses) in a special purchase vehicle (“SPV”) created by FCV to purchase the 8% Series A-1 Convertible Preferred Stock. The Company granted FCV and its assigns, the exclusive right to purchase the 8% Series A-1 Convertible Preferred Stock. | ||||||
Series A Convertible Preferred Stock [Member] | |||||||
Preferred stock, shares authorized | 3,000,000 | ||||||
Preferred stock, par value | $ 0.000001 | ||||||
Preferred stock conversion description | Shares of the Series A Convertible Preferred Stock are convertible at a 35% discount rate to the average closing price per share of the Company’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion. However, no conversions of the Series A Convertible Preferred Stock to shares of common stock can occur unless the average closing price per share of the Corporation’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion is at least $1.67. The shares of Series A Convertible Preferred Stock vote on a one for one basis. The right of conversion is limited by the fact the holder of the Series A Convertible Preferred Stock may not convert if such conversion would cause the holder to beneficially own more than 4.9% of the Company’s common stock after giving effect to such conversion. |
STOCK WARRANTS AND STOCK OPTI_3
STOCK WARRANTS AND STOCK OPTIONS (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Dividend yield | 0.00% | |
Volatility | 180.00% | |
Risk free interest rate | 0.13% | |
Stock Options [Member] | ||
Dividend yield | 0.00% | 0.00% |
Exercise Price | $ 0.50 | |
Volatility | 153.00% | |
Risk free interest rate | 0.29% | |
Life of warrants | 5 years | 5 years |
Stock Options [Member] | Minimum [Member] | ||
Exercise Price | $ 0.06 | |
Volatility | 135.00% | |
Risk free interest rate | 2.31% | |
Stock Options [Member] | Maximum [Member] | ||
Exercise Price | $ 0.2 | |
Volatility | 138.00% | |
Risk free interest rate | 2.53% |
STOCK WARRANTS AND STOCK OPTI_4
STOCK WARRANTS AND STOCK OPTIONS (Details 1) - Warrant [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Outstanding at beginning of period | 598,414 | 721,678 |
Warrants Granted | 320,000 | 498,562 |
Warrants Exercised | (454,097) | |
Warrants Expired | 1,503 | |
Outstanding at ending of periods | 464,317 | 1,218,737 |
Exercisables at beginning of period | 598,414 | |
Exercisable at end of period | 464,317 | |
Exercise Price Per Share | ||
Warrants Expired | $ 0.6319 | |
Minimum [Member] | ||
Exercise Price Per Share | ||
Outstanding at beginning of period | $ 0.13304 | 0.1397 |
Warrants Granted | 0.50 | 0.06 |
Warrants Exercised | 0.13304 | 0 |
Outstanding at end of period | 0.50 | 0.06 |
Exercisable at beginning of period | 0.13304 | |
Exercisable at end of period | 0.050 | 0 |
Maximum [Member] | ||
Exercise Price Per Share | ||
Outstanding at beginning of period | 1.039375 | 0.6319 |
Warrants Granted | 0 | 0.2062 |
Warrants Exercised | 0.15299 | 0 |
Outstanding at end of period | 1.039375 | 0.6319 |
Exercisable at beginning of period | 1.039375 | $ 0 |
Exercisable at end of period | $ 1.039375 | |
Weighted Average Remaining Contractual Life | ||
Weighted Average Remaining Contractual Life , Beginning balance | 3 years 11 months 19 days | 3 years 5 months 12 days |
Weighted Average Remaining Contractual Life, Warrants granted | 4 years 11 months 5 days | 4 years 8 months 19 days |
Weighted Average Remaining Contractual Life, Warrants exercised | ||
Weighted Average Remaining Contractual Life, Warrants expired | ||
Weighted Average Remaining Contractual Life, Ending balance | 4 years 1 month 28 days | 3 years 8 months 5 days |
Weighted Average Remaining Contractual Life, Exercisable, beginning | 3 years 11 months 19 days | |
Weighted Average Remaining Contractual Life, Exercisable, Ending | 4 years 1 month 28 days | |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Share, Beginning balance | $ 0.3607 | $ 0.1929 |
Weighted Average Exercise Price Per Share, Warrants granted | 0.50 | 0.1064 |
Weighted Average Exercise Price Per Share, Warrants exercised | 0.7143 | 0 |
Weighted Average Exercise Price Per Share, Warrants expired | 0 | 0.6319 |
Weighted Average Exercise Price Per Share, Ending balance | 0.66765 | 0.1596 |
Weighted Average Exercise Price Per Share, Exercisable Beginning balance | 0.3607 | |
Weighted Average Exercise Price Per Share, Exercisable Ending balance | $ 0.66765 | $ 0 |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Beginning balance | $ 1,276,870 | $ 0 |
Aggregate Intrinsic Value, Warrants granted | 768,000 | 22,428 |
Aggregate Intrinsic Value, Warrants exercised | 0 | 0 |
Aggregate Intrinsic Value, Warrants expired | 0 | 0 |
Aggregate Intrinsic Value, Ending balance | 1,036,521 | 0 |
Aggregate Intrinsic Value, exercisable beginning balance | 1,276,870 | 0 |
Aggregate Intrinsic Value, exercisable ending balance | $ 1,036,521 | $ 0 |
STOCK WARRANTS AND STOCK OPTI_5
STOCK WARRANTS AND STOCK OPTIONS (Details 2) - Stock Options [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Options Outstanding Number of Shares | ||
Outstanding at beginning of period | 2,381,239 | 53,367 |
Option Granted | 140,000 | |
Options Exercised | ||
Options Cancelled | 45,100 | |
Options Expired | ||
Outstanding at ending of periods | 2,521,239 | 8,267 |
Exercisables at beginning of period | 539,847 | |
Exercisable at end of period | 1,040,355 | |
Exercise Price Per Share | ||
Exercise Price Per Share Options Cancelled | $ 0.1497 | |
Weighted Average Remaining Contractual Life | ||
Weighted Average Remaining Contractual Lifes beginning balance | 8 years 10 months 9 days | 2 years 3 months 25 days |
Weighted Average Remaining Contractual Lifes options granted | 4 years 6 months 14 days | |
Weighted Average Remaining Contractual Lifes options expired | ||
Weighted Average Remaining Contractual Lifes ending balance | 8 years 1 month 24 days | 3 months 25 days |
Weighted Average Remaining Contractual Lifes, Exercisable, Beginning balance | 8 years 11 months 5 days | |
Weighted Average Remaining Contractual Lifes, Exercisable, Ending balance | 8 years 11 months 5 days | 8 years 11 months 5 days |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Shares beginning balance | $ 0.2946 | $ 0.2761 |
Weighted Average Exercise Price Per Shares options granted | 1.7504 | 0 |
Weighted Average Exercise Price Per Shares options exercised | 0 | |
Weighted Average Exercise Price Per Shares options cancelled | 0.1497 | |
Weighted Average Exercise Price Per Shares options expired | 0 | |
Weighted Average Exercise Price Per Shares ending balance | 0.3170 | 0.9678 |
Weighted Average Exercise Price Per Shares exercisable beginning balance | 0.4 | |
Weighted Average Exercise Price Per Shares exercisable ending balance | $ 0.5359 | $ 0 |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value beginning balance | $ 5,238,080 | $ 0 |
Aggregate Intrinsic Value options granted | 160,732 | 0 |
Aggregate Intrinsic Value options exercised | 0 | 0 |
Aggregate Intrinsic Value options cancelled | 0 | 0 |
Aggregate Intrinsic Value options expired | 0 | 0 |
Aggregate Intrinsic Value ending balance | 6,512,360 | 0 |
Aggregate Intrinsic Value exercisable, beginning balance | 1,129,786 | |
Aggregate Intrinsic Value exercisable ending balance | $ 2,459,933 | $ 0 |
Minimum [Member] | ||
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | $ 0.2634 | $ 0.1497 |
Exercise Price Per Shares option granted | 0.2634 | 0 |
Outstanding at end of period | 0.26342 | 0.2328 |
Exercisable at beginning of period | 0.2634 | |
Exercisable at end of period | 0.26342 | 0 |
Maximum [Member] | ||
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | 1.039 | 8.31 |
Exercise Price Per Shares option granted | 2 | 0 |
Outstanding at end of period | 2 | 8.31 |
Exercisable at beginning of period | 1.03938 | $ 0 |
Exercisable at end of period | $ 2 |
STOCK WARRANTS AND STOCK OPTI_6
STOCK WARRANTS AND STOCK OPTIONS (Details Narrative) - USD ($) | Jan. 03, 2020 | Aug. 08, 2019 | Jun. 05, 2020 | Oct. 25, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2012 | Apr. 07, 2020 | Oct. 24, 2019 |
Share-based compensation expense | $ 0 | $ 0 | $ 41,302 | $ 0 | |||||||||
Unrecognized compensation expense | 348,000 | ||||||||||||
Stock option expenses | $ 296,932 | $ 0 | |||||||||||
Description for non-vested share-based awards | The unrecognized compensation expense as of June 30, 2020 was approximately $348,000 for non-vested share-based awards to be recognized over periods of approximately three to seven years. | ||||||||||||
Exercise price | $ 2 | $ 2 | |||||||||||
Dividend yield | 0.00% | ||||||||||||
Volatility | 15300.00% | ||||||||||||
Risk-free interest rate | 29.00% | ||||||||||||
Life of options | 5 years | ||||||||||||
Options vested | 320,000 | ||||||||||||
Exercise price per share | $ 0.50 | ||||||||||||
Non Employee Stock Warrants [Member] | |||||||||||||
Number of warrants outstanding | 464,317 | 464,317 | 598,414 | ||||||||||
Detached free-standing stock warrants granted | 498,562 | 320,000 | |||||||||||
Fair value of detached free-standing stock warrants granted | $ 35,030 | $ 695,454 | |||||||||||
2019 Equity Incentive Plan [Member] | |||||||||||||
Common stock acquire | $ 2,521,239 | $ 2,521,239 | $ 2,381,239 | ||||||||||
Common stock authorized shares | 3,848,467 | ||||||||||||
Stock option vested shares | 1,040,355 | 1,040,355 | 539,847 | ||||||||||
Stock option non-vested shares | 1,480,884 | 1,480,884 | 1,841,392 | ||||||||||
Executive Stock Options [Member] | |||||||||||||
Number of warrants outstanding | 660,119 | 660,119 | 299,317 | ||||||||||
Options exercisable per share | $ 0.2634 | $ 0.2634 | |||||||||||
Asset Purchase Agreement [Member] | IDTEC [Member] | |||||||||||||
Expected lives | 5 years | ||||||||||||
Number of warrants outstanding | 320,000 | ||||||||||||
Exercise price of warrants | $ 0.50 | $ 0.50 | |||||||||||
Michael A. Lanphere [Member] | |||||||||||||
Reduction in related party debt | $ 65,875 | ||||||||||||
Number of warrants outstanding | 454,097 | ||||||||||||
Common stock shares issued to option exercised | 454,097 | ||||||||||||
Michael A. Lanphere [Member] | Non employee stock options [Member] | |||||||||||||
Expected lives | 5 years | ||||||||||||
Loan agreement description | The number of shares to be issued to Mr. Lanphere as a Stock Fee under each Agreement was an estimate and varied based on the loan amount and the price of our common stock on the day of the loan and was calculated by this formula: 60% or 80% of the loan amount divided by the Company’s stock price on the day of the loan, but at a price per share no higher than $0.025. | ||||||||||||
Gary Graham [Member] | |||||||||||||
Options vested | 12,027 | 0 | |||||||||||
Common stock acquire | $ 24,053 | ||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||
Expected lives | 5 years | ||||||||||||
First Capital Ventures "FCV" [Member] | 8% Series A-1 Convertible Preferred Stock Investment agreement [Member] | |||||||||||||
Number of warrants outstanding | 144,317 | 144,317 | 144,317 | ||||||||||
Exercise price of warrants | $ 1.039375 | ||||||||||||
Convertible preferred stock shares sold | 1,000,000 | ||||||||||||
Sale of stock price per share | $ 1 | ||||||||||||
Common stock shares issuable upon exercise of warrants to SPV | 144,317 | ||||||||||||
David Gandini [Member] | |||||||||||||
Options vested | 160,361 | ||||||||||||
Common stock acquire | $ 721,588 | ||||||||||||
Stock options vested | 400,882 | 400,882 | 240,521 | ||||||||||
Option vesting terms | (i) 200,439 Pre-Vesting Option Shares representing the monthly vesting option shares for the ten months ended October 31, 2019 to vest on November 1, 2019; and (ii) the remaining 40,090 Pre-Vesting Option Shares representing the monthly vesting option shares for the two months ended December 31, 2019 shall vest on January 1, 2020. | ||||||||||||
Installments period description | Stock options to vest in 36 equal monthly installments of 20,044 shares during the three-year term of the employment agreement. | ||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||
Expected lives | 10 years | ||||||||||||
Kevin Moore [Member] | Employment Agreement [Member] | |||||||||||||
Options vested | 176,388 | ||||||||||||
Common stock acquire | $ 1,058,328 | ||||||||||||
Stock options vested | 235,184 | 235,184 | 58,796 | ||||||||||
Installments period description | Stock options to vest in 36 equal monthly installments of 29,398 shares during the three-year term of the employment agreement. | ||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||
Expected lives | 3 years | ||||||||||||
Nick Noceti [Member] | |||||||||||||
Options vested | 6,013 | 0 | |||||||||||
Common stock acquire | $ 24,053 | ||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||
Expected lives | 5 years | ||||||||||||
Reduction in related party debt | $ 127,480 | $ 127,480 | |||||||||||
Charles Bennington [Member] | |||||||||||||
Options vested | 12,027 | 0 | |||||||||||
Common stock acquire | $ 24,053 | ||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||
Expected lives | 5 years | ||||||||||||
Reduction in related party debt | $ 9,656 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | Oct. 15, 2015USD ($) |
Short Term Lease Agreement [Member] | Highland School [Member] | |
Lease expiration term | Oct. 31, 2020 |
Short Term Lease Agreement [Member] | Highland School [Member] | Minimum [Member] | |
Operating lease, monthly payment | $ 2,800 |
Short Term Lease Agreement [Member] | Highland School [Member] | Maximum [Member] | |
Operating lease, monthly payment | 2,900 |
Short Term Operating Lease [Member] | |
Operating lease, monthly payment | $ 1,300 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Events [Member] - July 1, 2020 and August 3, 2020 [Member] - 8% Series A-1 Convertible Preferred Stock [Member] | 6 Months Ended |
Jun. 30, 2020USD ($)shares | |
Sale of stock per transaction | $ 1 |
Total purchase price of shares | $ 953,000 |
Sale of stock number of shares issued | shares | 953,000 |