Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 31, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | SOBR Safe, Inc. | ||
Entity Central Index Key | 0001425627 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Entity Common Stock Shares Outstanding | 25,965,203 | ||
Entity Public Float | $ 13,497,633 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash | $ 232,842 | $ 681,759 |
Prepaid expenses | 115,230 | 9,054 |
Total current assets | 348,072 | 690,813 |
SOBR Safe Intellectual Technology, net of accumulated amortization of $224,854 at December 31, 2020 | 3,629,821 | 0 |
Other assets | 8,680 | 0 |
Total Assets | 3,986,573 | 690,813 |
Current liabilities | ||
Accounts payable | 101,308 | 213,880 |
Accrued expenses | 313,032 | 419,836 |
Accrued interest payable | 134,444 | 674,041 |
Related party payables | 28,624 | 905,443 |
Derivative liabilities | 0 | 60,650 |
Common stock subscriptions payable | 253,688 | 79,624 |
Preferred stock subscriptions payable | 0 | 1,000,000 |
Notes payable - current - related parties | 11,810 | 760,886 |
Notes payable - current - non-related parties | 104,183 | 169,574 |
Total current liabilities | 947,089 | 4,283,934 |
Total Liabilities | 947,089 | 4,283,934 |
Stockholders' Equity (Deficit) | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of December 31, 2020 and December 31, 2019 | 0 | 0 |
Common stock, $0.00001 par value; 100,000,000 shares authorized; 25,922,034 and 6,452,993 shares issued and outstanding as of December 31, 2020 and December 31, 2019, respectively, after 1-for-33.26 reverse stock split | 260 | 65 |
Additional paid-in capital | 52,693,974 | 15,971,392 |
Accumulated deficit | (49,601,220) | (19,511,168) |
Total SOBR Safe, Inc. stockholders' equity (deficit) | 3,093,014 | (3,539,711) |
Noncontrolling interest | (53,530) | (53,410) |
Total Stockholders' Equity (Deficit) | 3,039,484 | (3,593,121) |
Total Liabilities and Stockholders' Equity (Deficit) | 3,986,573 | 690,813 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of December 31, 2020 and December 31, 2019 | 0 | 0 |
Additional paid-in capital | 1,329,561 | |
Series A-1 Convertible Preferred stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of December 31, 2020 and December 31, 2019 | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current liabilities | ||
Notes payable current - related parties, unamortized debt discount | $ 8,656 | $ 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 | 25,922,034 | 6,452,993 |
Common stock, shares outstanding | 25,922,034 | 6,452,993 |
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 19,300,000 | 19,300,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 3,000,000 | 3,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Series A-1 Convertible Preferred stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 2,700,000 | 2,700,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 0 | $ 0 |
Operating expenses: | ||
General and administrative | 632,426 | 232,178 |
Stock-based compensation expense | 273,443 | 44,082 |
Management salaries and consulting fees | 1,370,681 | 498,246 |
Research and development | 633,050 | 12,787 |
Total operating expenses | 2,909,600 | 787,293 |
Loss from operations | (2,909,600) | (787,293) |
Other income (expense): | ||
Loss on debt extinguishment, net | (224,166) | 0 |
Loss on disposal of property and equipment | (39,434) | 0 |
Gain on fair value adjustment - derivatives | 60,650 | 4,150 |
Interest expense | (141,512) | (457,505) |
Amortization of interest - beneficial conversion feature | (1,407,675) | (11,509) |
Asset impairment adjustment | (25,320,555) | 0 |
Total other expense, net | (27,072,692) | (464,864) |
Loss before provision for income taxes | (29,982,292) | (1,252,157) |
Provision for income taxes | 0 | 0 |
Provision for income tax | 0 | 0 |
Net loss | (29,982,292) | (1,252,157) |
Net loss attributable to noncontrolling interest | 120 | 3,125 |
Net loss attributable to SOBR Safe, Inc. | (29,982,172) | (1,249,032) |
Dividends on convertible preferred stock | (107,880) | 0 |
Net loss attributable to common stockholders | $ (30,090,052) | $ (1,249,032) |
Basic and diluted loss per common share | $ (1.95) | $ (0.23) |
Weighted average number of common shares outstanding | 15,399,208 | 5,081,122 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Total | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Noncontrolling Interest [Member] | Stockholders Deficit SOBR Safe Inc [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) | $ (50,285) | $ (3,373,146) |
Common stock issued for cash, shares | 1,065,982 | ||||||
Common stock issued for cash, amount | 39,000 | $ 11 | $ 0 | 38,989 | 0 | 0 | 39,000 |
Common stock issued for executive compensation, shares | 420,926 | ||||||
Common stock issued for executive compensation, amount | 59,500 | $ 4 | $ 0 | 59,496 | 0 | 0 | 59,500 |
Common stock issued due to stock warrants exercise, shares | 1,038,339 | ||||||
Common stock issued due to stock warrants exercise, amount | 146,774 | $ 11 | $ 0 | 146,763 | 0 | 0 | 146,774 |
Common stock issued upon conversion of convertible preferred stock to common stock, shares | 417,491 | (1,388,575) | |||||
Common stock issued upon conversion of convertible preferred stock to common stock, amount | (1,329,560) | $ 4 | $ (14) | (1,329,550) | 0 | 0 | (1,329,560) |
Paid-in capital - fair value of stock warrants granted | 160,544 | 0 | 0 | 160,544 | 0 | 0 | 160,544 |
Paid-in capital - fair value of related party stock options vested | 71,655 | 0 | 0 | 71,655 | 0 | 0 | 71,655 |
Paid-in capital - fair value of non-related party stock options granted | 23,912 | 0 | 0 | 23,912 | 0 | 0 | 23,912 |
Paid-in capital - gain on related party executive compensation conversion | 535,500 | 0 | 0 | 535,500 | 0 | 0 | 535,500 |
Paid-in capital - gain on related party debt conversion | 39,992 | 0 | 0 | 39,992 | 0 | 0 | 39,992 |
Paid-in capital - gain on related party preferred stock conversion | 1,329,561 | 0 | 0 | 1,329,561 | 0 | 0 | 1,329,561 |
Paid-in capital - beneficial conversion feature | 5,589 | 0 | 0 | 5,589 | 0 | 0 | 5,589 |
Net loss | (1,252,157) | $ 0 | $ 0 | 0 | (1,249,032) | (3,125) | (1,249,032) |
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) | (53,410) | (3,539,711) |
Common stock issued for executive compensation, shares | 72,159 | ||||||
Common stock issued for executive compensation, amount | 76,480 | $ 1 | $ 0 | 76,479 | 0 | 0 | 76,480 |
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 | 0 | 65,728 |
Common stock issued upon conversion of convertible preferred stock to common stock, shares | 2,700,000 | (2,700,000) | |||||
Common stock issued upon conversion of convertible preferred stock to common stock, amount | 0 | $ 27 | $ (27) | 0 | 0 | 0 | 0 |
Paid-in capital - fair value of stock warrants granted | 915,124 | 0 | 0 | 915,124 | 0 | 0 | 915,124 |
Paid-in capital - gain on related party debt conversion | 124,291 | 0 | 0 | 124,291 | 0 | 0 | 124,291 |
Paid-in capital - beneficial conversion feature | 1,407,675 | 0 | 0 | 1,407,675 | 0 | 0 | 1,407,675 |
Net loss | (29,982,292) | $ 0 | $ 0 | 0 | (29,982,172) | (120) | (29,982,172) |
Common stock issued for compensation, shares | 1,025 | ||||||
Common stock issued for compensation, amount | 20,800 | $ 0 | $ 0 | 20,800 | 0 | 0 | 20,800 |
Common stock issued for asset purchase, shares | 12,000,000 | ||||||
Common stock issued for asset purchase, amount | 27,120,000 | $ 120 | $ 0 | 27,119,880 | 0 | 0 | 27,120,000 |
Common stock issued to settle accounts payable and accrued expenses, shares | 159,395 | ||||||
Common stock issued to settle accounts payable and accrued expenses, amount | 265,677 | $ 2 | $ 0 | 265,675 | 0 | 0 | 265,677 |
Common stock issued to settle related party payables, shares | 260,150 | ||||||
Common stock issued to settle related party payables, amount | 579,814 | $ 3 | $ 0 | 579,811 | 0 | 0 | 579,814 |
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 | 0 | 826,964 |
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 | 0 | 166,526 |
Common stock issued upon conversion of related party debt and accrued interest, shares | 3,103,028 | ||||||
Common stock issued upon conversion of related party debt and accrued interest, amount | 1,551,514 | $ 31 | $ 0 | 1,551,483 | 0 | 0 | 1,551,514 |
Series A-1 Convertible Preferred stock issued for cash, shares | 2,700,000 | ||||||
Series A-1 Convertible Preferred stock issued for cash, amount | 2,700,000 | $ 0 | $ 27 | 2,699,973 | 0 | 0 | 2,700,000 |
Paid-in capital - fair value of stock options vested | 239,476 | 0 | 0 | 239,476 | 0 | 0 | 239,476 |
Paid-in capital - gain on related party payables conversion | 272,299 | 0 | 0 | 272,299 | 0 | 0 | 272,299 |
Paid-in capital - loss on debt extinguishment | 390,409 | 0 | 0 | 390,409 | 0 | 0 | 390,409 |
Dividends - Series A-1 Convertible Preferred stock | (107,880) | $ 0 | $ 0 | 0 | (107,880) | 0 | (107,880) |
Balance, shares at Dec. 31, 2020 | 25,922,034 | ||||||
Balance, amount at Dec. 31, 2020 | $ 3,039,484 | $ 260 | $ 0 | $ 52,693,974 | $ (49,601,220) | $ (53,530) | $ 3,093,014 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Activities: | ||
Net loss | $ (29,982,292) | $ (1,252,157) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 232,194 | 0 |
Loss on debt extinguishment, net | 224,166 | 0 |
Loss on disposal of property and equipment | 39,434 | 0 |
Change in fair value of derivative liability | (60,650) | (4,150) |
Interest expense-embedded conversion feature | 0 | 64,800 |
Amortization-debt discount | 8,656 | 5,920 |
Amortization of interest - beneficial conversion feature | 1,407,675 | 5,589 |
Stock warrants expense | 219,670 | 159,961 |
Stock options expense | 239,478 | 95,567 |
Stock-based compensation expense | 54,283 | 44,082 |
Asset impairment adjustment | 25,320,555 | 0 |
Changes in assets and liabilities: | ||
Prepaid expenses | 3,515 | 3,937 |
Other assets | (8,680) | 0 |
Accounts payable | 113,158 | 22,166 |
Accrued expenses | (4,666) | (1,165) |
Accrued interest payable | 26,677 | 160,772 |
Related party payables | (24,706) | 72,369 |
Stock subscriptions payable | 0 | 78,353 |
Net cash used in operating activities | (2,191,533) | (543,956) |
Investing Activities: | ||
Proceeds from disposal of property and equipment | 951 | 0 |
Financing Activities: | ||
Proceeds from notes payable - related parties | 0 | 186,626 |
Proceeds from notes payable - non-related parties | 41,665 | 0 |
Proceeds from issuances of common stock - non-related parties | 0 | 39,000 |
Proceeds from offering of preferred stock - related parties | 1,700,000 | 1,000,000 |
Net cash provided by financing activities | 1,741,665 | 1,225,626 |
Net Change In Cash | (448,917) | 681,670 |
Cash At The Beginning Of The Period | 681,759 | 89 |
Cash At The End Of The Period | 232,842 | 681,759 |
Schedule Of Non-Cash Investing And Financing Activities: | ||
Prepaid expenses with common shares | $ 122,162 | $ 0 |
Issuance of common stock, stock warrants and convertible note for asset purchase | 29,222,955 | |
Accounts payables and accrued expenses converted to capital | $ 265,677 | $ 0 |
Related party payables converted to capital | 579,814 | 59,500 |
Gain on related party payables converted to capital | 272,299 | 575,492 |
Related party debt converted to capital | 2,378,478 | 0 |
Related party debt converted to capital after exercise of cashless stock warrants | 65,728 | 0 |
Gain on related party debt converted to capital | 124,291 | 0 |
Non-related party debt converted to capital | 166,526 | 0 |
Shares issued for cash received in prior years | 1,000,000 | 0 |
Shares issued for executive compensation in prior year | 76,480 | 0 |
Gain on related party conversion of preferred stock into common stock | 0 | 1,329,561 |
Shares to be issued for accrued dividends | 107,880 | 0 |
Fair value of embedded conversion feature | 0 | 64,800 |
Intrinsic value-beneficial conversion feature | 1,407,501 | 5,589 |
Fair value of stock options granted | 0 | 95,567 |
Fair value of stock warrants granted | 0 | 160,544 |
Exercise of cashless stock warrants | 0 | 146,774 |
Supplemental Disclosure: | ||
Cash paid for interest | 1,979 | 3,750 |
Cash paid for income taxes | $ 0 | $ 0 |
ORGANIZATION, OPERATIONS AND SU
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SOBR Safe, Inc. (“SOBR Safe”), formerly TransBiotec, Inc., was incorporated as Imagine Media, Ltd. in 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 SOBR Safe 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 SOBR Safe after the share exchange. The consolidated financial statements represent the activity of TransBiotec - CA from July 4, 2004 forward, and the consolidated activity of SOBR Safe and TransBiotec - CA from September 19, 2011 forward. SOBR Safe 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 14-C 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 share amounts have been adjusted in these consolidated financial statements to reflect the effect of the reverse stock split. Basis of Presentation The accompanying audited 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”) for the presentation of annual financial information. In management’s opinion, the audited consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position for the years ended December 31, 2020 and December 31, 2019, and results of operations and cash flows for the years ended December 31, 2020 and December 31, 2019. Principles of Consolidation The accompanying audited 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 audited financial statements. The preparation of audited 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. 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, related party payables, notes payable, convertible debentures, and other liabilities. 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 December 31, 2020 and December 31, 2019: December 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 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 December 31, 2020 and December 31, 2019. Prepaid Expenses Amounts incurred in advance of contractual performance or coverage periods are recorded as prepaid assets and recognized as expense in the period service or coverage is provided. 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 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 December 31, 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. 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 $633,050 and $12,787 during the years ended December 31, 2020 and December 31, 2019, respectively. Advertising and Marketing Costs Advertising and marketing costs are charged to operations as incurred. Advertising and marketing costs were $96,637 and $3,724 during the years ended December 31, 2020 and December 31, 2019, respectively. Income Tax The Company accounts for income taxes pursuant to 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 a deferred tax asset of approximately $2,830,000 and $1,832,000 that is offset by a 100% valuation allowance at December 31, 2020 and December 31, 2019, respectively. Therefore, the Company has not recorded any deferred tax assets or liabilities at December 31, 2020 and December 31, 2019. Net Loss Per Share Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share gives the effect to all dilutive potential common shares outstanding during the period, including stock options, warrants and convertible instruments. Diluted net loss per share excludes all potentially issuable shares if their effect is anti-dilutive. Because the effect of the Company’s dilutive securities is anti-dilutive, diluted net loss per share is the same as basic loss per share for the periods presented. Concentration of Credit Risk Certain financial instruments potentially subject the Company to concentrations of credit risk. Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Cash held in operating accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”), insurance limits. Accounts at each institution are insured by the FDIC up to $250,000. While the Company monitors cash balances in our operating accounts on a regular basis and adjust the balances as appropriate, these balances could be impacted if the underlying financial institutions fail. To date, the Company has experienced no loss or lack of access to our cash; however, the Company can provide no assurances that access to our cash will not be impacted by adverse conditions in the financial markets. At December 31, 2020 and December 31, 2019, the Company had $0 and $431,759 in excess of the FDIC insured limit, respectively. 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 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, In October 2020, the FASB issued ASU No. 2020-08, Codification Improvements to Subtopic 310-20, Receivables-Nonrefundable Fees and Other Costs, Premium Amortization on Purchased Callable Debt Securities |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Dec. 31, 2020 | |
GOING CONCERN | |
NOTE 2. GOING CONCERN | The Company has incurred recurring losses from operations and has limited cash liquidity and capital resources. Future capital requirements will depend on many factors, including the Company’s ability to develop products, cash flow from operations, and competing market developments. The Company will need additional capital in the near future. Sources of debt financing may result in high interest expense. Any financing, if available, may be on unfavorable terms. If adequate funds are not obtained, we will be required to reduce or curtail operations. As of December 31, 2020, the Company has an accumulated deficit of approximately $50,000,000. During the year ended December 31, 2020, the Company also experienced negative cash flows from operating activities of approximately $2,200,000. It appears these principal conditions or events, considered in the aggregate, indicate it is probable that the Company 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 identified factors that mitigate the probable conditions that have raised substantial doubt about the entity’s ability to continue as a going concern. On January 15, 2021, the Company initiated a Private Offering (the “Offering”) of up to 40 Units ($2,000,000) with each Unit consisting of one $50,000 principal amount secured convertible debenture, convertible at $3.00 per share, and a Warrant to purchase 25,000 shares of the Company’s common stock at $3.00 per share. The Secured Debentures carry interest at 12% and mature 24 months after issuance. The Warrants are exercisable six months after issuance and expire 24 months after issuance . The Offering will be made on a continuous basis until March 31, 2021, which may be extended one-time by our Board of Directors until April 30, 2021 (the “Termination Date”), unless earlier terminated or canceled. There will be no closing of the Offering until a minimum of $500,000 is raised. After an initial closing is held, offers to purchase Units will be aggregated for subsequent closings to be held on a monthly basis until the maximum of $2,000,000 has been raised or until the Termination Date, whichever is earlier. The Offering may be canceled by the Company at any time and will in any event be canceled if no closing has occurred before the Termination Date. As of the date of this report the Company has received $1,100,000 of the Offering amount. We will need additional funds beyond the money raised in this Offering, even if the maximum Offering is met. As a result, we are planning on additional financings in the future. 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 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 2021. However, if the pandemic continues, it may have a adverse effect on the Company’s results of future operations, financial position, and liquidity in fiscal year 2021. 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 December 31, 2020. Additionally, the COVID-19 outbreak could have a continued material 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 to continue as a going concern. As such, substantial doubt about the entity’s ability to continue as a going concern was not alleviated as of December 31, 2020. |
ASSET PURCHASE
ASSET PURCHASE | 12 Months Ended |
Dec. 31, 2020 | |
ASSET PURCHASE | |
NOTE 3. ASSET 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”), with simple interest at 10% per annum, 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. 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 allocation to identifiable intangible assets required extensive use of financial information and management's best estimate of fair value. 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 notes payable) $ 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 year ended December 31, 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. |
PREPAID EXPENSES
PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2020 | |
PREPAID EXPENSES | |
NOTE 4. PREPAID EXPENSES | Prepaid expenses consist of the following: December 31, 2020 December 31, 2019 Insurance $ 3,370 $ - Consulting services 111,860 7,343 Other prepaid expenses - 1,711 Prepaid expenses $ 115,230 $ 9,054 During 2020, the Company entered into two consulting agreements for marketing services. The Company has to issue a total of 87,500 of its common shares valued at $142,714 under the terms of the agreements. As of December 31, 2020, the share value is included in common stock subscriptions payable as the shares had not been issued. Stock- based compensation expense for the year ended December 31, 2020 includes approximately $33,000 for these service agreements. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT | |
NOTE 5. PROPERTY AND EQUIPMENT | Property and equipment, net consists of the following: December 31, 2020 Robotics and testing equipment $ 46,200 Office furniture and equipment 1,525 47,725 Accumulated depreciation (7,340 ) Net property and equipment disposed (40,385 ) Property and equipment, net $ 0 Depreciation is computed on a straight-line basis over the assets estimated useful lives of three years. Depreciation for the years ended December 31, 2020 and 2019 was $7,340 and none, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
INTANGIBLE ASSETS | |
NOTE 6. INTANGIBLE ASSETS | Intangible assets consist of the following at December 31, 2020: Gross Carrying Amount Accumulated Amortization Net Intangible Asset Amortization Period (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 224,854 $ 3,629,821 10 Amortization expense for the years ended December 31, 2020 and 2019 was $224,854 and none, respectively. Estimated future amortization expense for device technology intangible assets is as follows: 2021 2022 2023 2024 2025 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,702,486 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
NOTE 7. RELATED PARTY TRANSACTIONS | On December 3, 2014, Lanphere Law Group, a related party and 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 years ended December 31, 2020 and 2019 of none and $22,585, respectively. The Company converted the remaining payables to common stock through a separate agreement and there are no more payables to convert as of December 31, 2020. On July 1, 2015, the Company amended the December 3, 2014 note payable agreement with Lanphere Law Group, 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. This amendment also extended the note payable’s due date to December 2, 2015. The note was converted to common stock during the year ended December 31, 2020. On March 8, 2017, Lanphere Law Group 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 December 31, 2020 and December 31, 2019, the principal balance of this note was none and $31,662, respectively. As of December 31, 2020 and December 31, 2019, the accrued interest on this note was none and $9,508, respectively. Due to cash flow constraints, the Company experienced difficulty in compensating its directors for their service in their capacity as directors; therefore, such directors may receive stock options to purchase common shares as awarded by its Board of Directors or (as to future stock options) a compensation committee which may be established. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with business related travel and attendance at meetings of its Board of Directors. The Company’s Board of Directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director. On August 23, 2019, the Company entered into a Common Stock Purchase Agreement (the “Bennington SPA”) with Charles Bennington, one of the Company’s directors, under which the Company agreed to issue 420,926 shares of its common stock in exchange for Mr. Bennington forgiving $595,000 in accrued compensation and services due. The Company also recorded a related party gain on the conversion of executive compensation to common shares of $535,500 that was accounted for as additional paid-in capital. The common shares were issued on or about August 28, 2019 at a per-share purchase price of $1.4135 per share. On August 23, 2019, the Company entered into a Debt Conversion and Common Stock Purchase Plan (the “Lanphere SPA”) with Michael Lanphere, a beneficial owner of the Company, under which the Company agreed to issue 643,438 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere under numerous 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. The amount of the debt reduction and, therefore the purchase price of the shares, was $96,303 which was used for the deduction of related party notes payable principal of $77,927 and accrued interest of $18,376. The Company recognized a related party gain of $5,350 and accounted for it as additional paid-in capital. The common shares were issued on or about August 28, 2019 at an effective conversion price of $0.1497 per share. After this exercise, Lanphere Law Group owned warrants to acquire an additional 454,097 shares of our common stock, which were subsequently exercised during 2020. On August 23, 2019, the Company entered into a Debt Conversion and Common Stock Purchase Plan (the “Mishal SPA”) with Devadatt Mishal, one of the Company’s former directors and current shareholder, under which the Company agreed to issue 394,901 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Mishal under numerous promissory notes. Mr. Mishal’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. Mishal. The amount of the debt reduction and, therefore the purchase price of the shares, was $56,478 which was used for the deduction of related party notes payable principal of $45,000 and accrued interest of $11,478. The Company recognized a related party gain of $657 and accounted for it as additional paid-in capital. The common shares were issued on or about August 28, 2019 at an effective conversion price of $0.1430 per share. After this exercise, Devadatt Mishal owns no warrants to acquire additional shares of our common stock. On August 23, 2019, the Company entered, into a Share Exchange Agreement (the “Lanphere SEA”) with Michael Lanphere, a beneficial owner of the Company under which the Company agreed to issue 156,537 shares of its common stock in exchange for 520,643 shares of the Company’s Series A Convertible Preferred Stock owned by Mr. Lanphere. The Series A Convertible Preferred Stock were exchanged for the Company’s common shares at a price of $3.326 per share. The fair value of the common shares was $22,127. Per ASC 470-50-40-2, debt modification and extinguishment transactions between related parties are in essence a capital contribution from a related party. As a result, rather than recording a gain on extinguishment of debt, the Company recorded $498,516 to additional paid-in capital. On August 23, 2019, the Company entered into a Share Exchange Agreement (the “Justus SEA”) with Vernon Justus, a shareholder, under which the Company agreed to issue 260,954 shares of its common stock in exchange for 867,932 shares of the Company’s Series A Convertible Preferred Stock owned by Mr. Justus. The Series A Convertible Preferred Stock were exchanged for the Company’s common shares at a price of $3.326 per share. The fair value of the common shares was $36,887. Per ASC 470-50-40-2, debt modification and extinguishment transactions between related parties are in essence a capital contribution from a related party. As a result, rather than recording a gain on extinguishment of debt, the Company recorded $831,045 to additional paid-in capital. The Company entered into a lease agreement with Lanphere Law Group, a related party and shareholder, whereas the Company was the tenant and paying monthly rent of $4,100. The term of this operating lease ran from July 1, 2015 to June 30, 2019. From July 1, 2019 through December 31, 2019, the Company leased the same office space on a month to month basis. Rent expense, including CAM charges, for the years ended December 31, 2020 and 2019 of none and $39,315, respectively, was accounted for as general and administrative expense. On October 25, 2019, the Company granted Charles Bennington, one of the Company’s directors, an option to acquire 24,053 shares of the Company’s common stock under the Company’s 2019 Equity Incentive Plan. The stock option has an exercise price of $0.2635, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a one-year period commencing January 1, 2020. The stock option has a five-year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Bennington is one of the Company’s directors, is a sophisticated investor and familiar with our operations. None of Mr. Bennington’s common stock options vested, and therefore none were expensed during the year ended December 31, 2019. For the year ended December 31, 2020, stock option expense for the options vested was $4,592. No vested options were exercised as of December 31, 2020. On October 25, 2019, the Company granted Nick Noceti, the Company’s former Chief Financial Officer, an option to acquire 24,053 shares of our common stock under our 2019 Equity Incentive Plan. The stock option has an exercise price of $0.2635, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a two-year period commencing January 1, 2020. The stock option has a five-year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Noceti was at that time the Company’s Chief Financial Officer, is a sophisticated investor and familiar with our operations. None of Mr. Noceti’s common stock options vested, and therefore none were expensed during the year ended December 31, 2019. For the year ended December 31, 2020, stock option expense for the options vested was $2,271. No vested options were exercised as of December 31, 2020. On October 25, 2019, the Company granted Gary Graham, one of the Company’s former directors and current beneficial owner of the Company, an option to acquire 24,053 shares of our common stock under our 2019 Equity Incentive Plan. The stock option has an exercise price of $0.2635, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a one-year period commencing January 1, 2020. The stock option has a five-year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Graham had been consulting with the Company for more than one year at the time of grant, is a sophisticated investor and familiar with our operations. None of Mr. Graham’s common stock options vested, and therefore none were expensed during the year ended December 31, 2019. For the year ended December 31, 2020, stock option expense for the options vested was $4,592. No vested options were exercised as of December 31, 2020. On October 25, 2019, the Company entered into an Employment Agreement with Mr. Kevin Moore to serve as the Company’s Chief Executive Officer (the “Moore Agreement”). Under the terms of the Moore Agreement, Mr. Moore will perform services for the Company that are customary and usual for a chief executive officer of a company, in exchange for: (i) 24,053 shares of our common stock per month until the IDTEC Transaction closes, (ii) thereafter, an annual base salary of $213,000, (iii) sales bonuses based on the Company’s sales, and (iv) incentive stock options under the Company’s 2019 Equity Compensation Plan to acquire 1,058,329 shares of our common stock, at an exercise price of $0.2635, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with the stock options to vest in 36 equal monthly installments of 29,398 shares during the three-year term of the Moore Agreement. The stock options have a ten-year term. 58,796 of these common stock option shares, valued at $14,080, were vested and expensed at December 31, 2019. No shares have been issued to Mr. Moore as of December 31, 2019. For the year ended December 31, 2020, stock option expense for the 352,776 options vested was $79,557. No vested options were exercised as of December 31, 2020. On October 25, 2019, the Company entered into an Employment Agreement with Mr. David Gandini to serve as the Company’s Chief Revenue Officer (the “Gandini Agreement”). Under the terms of the Gandini Agreement, Mr. Gandini will perform services for the Company that are customary and usual for a chief revenue officer of a company, in exchange for: (i) an annual base salary of $185,000, (ii) sales bonuses based on the Company’s sales, (iii) incentive stock options under our 2019 Equity Compensation Plan to acquire 721,588 shares of our common stock, at an exercise price of $0.2635, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with the stock options to vest in 36 equal monthly installments of 20,044 shares during the three-year term of the Gandini Agreement, and (iv) an aggregate of 240,530 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 40,091 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. The Company will be issuing Mr. Gandini a stock option agreement for the options he was issued under the Gandini Agreement. 240,530 of these common stock option shares, valued at $57,574, were vested and expensed at December 31, 2019. No shares have been issued to Mr. Gandini as of December 31, 2019. For the year ended December 31, 2020, stock option expense for the 240,530 options vested was $54,720. No vested options were exercised as of December 31, 2020. On January 3, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Michael Lanphere, a beneficial owner of the Company, under which he agreed to exercise warrants 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 approximately $66,000 which was used for the deduction of related party notes payable principal of approximately $66,000. 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, 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 shareholder, 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, 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 former directors and current shareholder, 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 $186,341. 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 and current shareholder, 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. 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 directors, to issue 6,831 shares of its common stock in exchange for amounts due for Board of Director fees. 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 | 12 Months Ended |
Dec. 31, 2020 | |
NOTES PAYABLE | |
NOTE 8. NOTES PAYABLE | RELATED PARTIES Related party notes payable consist of the following: December 31, 2020 December 31, 2019 Convertible Notes Payable $ - $ 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 $ 11,810 $ 760,886 Total interest expense for related party notes was $98,313 and $91,845 for the years ended December 31, 2020 and 2019, respectively. Related Party Convertible Notes Payable The Company has none and seven convertible notes payable to related parties that have a principal balance of none and $161,000 as of December 31, 2020 and December 31, 2019, respectively. These notes carried interest rates ranging from 7% to 10%. These notes carried fixed and variable conversion prices per share. The Company evaluated these convertible notes payable for embedded 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 Company evaluated these convertible notes and determined that its embedded conversion feature carried a debt discount that should be fully amortized upon grant. The Company fully amortized this debt discount and recorded it as amortization of debt discount – interest expense in the amount of $64,800 for the year end December 31, 2019. During 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with a related party, under which the Company agreed to issue approximately 157,000 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. On June 5, 2020 the Company issued the convertible APA Note to a related party with a principal balance of $1,485,189, which included the $70,000 balance of three convertible notes payable to related parties and related accrued interest of $7,689 outstanding at December 31, 2019. The note includes simple interest at 10% per annum, 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 Company evaluated the convertible note payable for derivative embedded and beneficial conversion features. The Company determined that there was a beneficial conversion feature to record. During the year ended December 31, 2020, beneficial conversion feature amortization expense related to this related party convertible note payable of $1,407,675 was accounted for as amortization of interest - beneficial conversion feature expense in the consolidated statements of operations. On November 15, 2020, the related party holder elected to convert the note principal and accrued interest balance of $1,551,514 into 3,103,028 of shares of common stock. Related Party Non-convertible Notes Payable The Company has one and nine non-convertible notes payable to related parties that have a principal balance of $11,810 and $328,423 as of December 31, 2020 and December 31, 2019, respectively. These notes carry interest rates ranging from 0% to 10%. The outstanding note payable as of December 31, 2020 had a due date of December 31, 2012 and is currently in default. During 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with four related parties, under which the Company agreed to issue approximately 343,000 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 reduction of related party non-convertible notes payable principal of $316,613 and accrued interest of $232,698. Related Party Notes Payable with Warrants The Company has none and twenty-four notes payable with detached free-standing warrants to related parties that have a principal balance of none and $280,119 as of December 31, 2020 and December 31, 2019, respectively. These notes carried interest rates ranging from 7% to 10%. The exercise price for each note payable with detached free-standing warrant ranged from $0.1330 - $0.1530. As of December 31, 2019, these notes carried outstanding detached free-standing warrants of 454,097. The unamortized discount related to these stock warrants at December 31, 2020 and December 31, 2019 is none and $8,656, respectively. During the years ended December 31, 2020 and 2019, stock warrants amortization expense recorded as interest expense related to these stock warrants was $8,656 and $37,072, respectively. The relative fair market value of the related stock warrants granted during the years ended December 31, 2020 and 2019 was none and $38,998, respectively. During 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with two related parties, under which the Company agreed to issue approximately 602,000 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. NON- RELATED PARTIES Non- related party notes payable consist of the following: December 31, 2020 December 31, 2019 Convertible Notes Payable $ 56,683 $ 143,136 Conventional Non-Convertible Notes Payable 42,500 21,438 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Net Non-Related Party Notes Payable $ 104,183 $ 169,574 Total interest expense for non-related party notes was $17,415 and $56,546 for the years ended December 31, 2020 and 2019, respectively. Convertible Notes Payable The Company has three and fifteen convertible notes payable to non-related parties that have a principal balance of $56,683 and $143,136 as of December 31, 2020 and December 31, 2019, respectively. These notes carry interest rates ranging from 5% - 30% and have due dates ranging from 2/08/2012 – 3/06/2022. Two of the three notes as of December 31, 2020 are in default. These notes carry conversion prices ranging from $0.0565- $10.7619 per share. The Company evaluated these convertible notes payable for derivative embedded 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 December 31, 2020 and 2019. During the years ended December 31, 2020 and 2019, beneficial conversion feature amortization expense related to these convertible notes payable of none and $5,920, respectively, was accounted for as amortization of interest - beneficial conversion feature expense in the consolidated statements of operations. During 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 $166,750 which was used for the deduction of non-related party convertible notes payable principal of $83,953 and accrued interest of $82,797. The Company recorded a non-related party gain on loan extinguishment of approximately $103,000. During 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. During 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 $25,000 that bears interest at 5%. The Company recorded a gain on non-related party debt extinguishment of $61,875. Non-convertible Notes Payable The Company has three non-convertible notes payable to non-related parties that have a principal balance of $42,500 and $21,438 as of December 31, 2020 and December 31, 2019, respectively. These notes carry interest rates ranging from 5% - 18% and have due dates ranging from 1/31/2013 - 6/09/2022. Two of the three notes as of December 31, 2020 are in default. During 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 a 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 approximately $14,000. 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. On December 7, 2020 the Company was notified that the principal balance and accrued interest of $242 was forgiven, and thus the Company recorded a gain on loan extinguishment of approximately $42,000. Notes Payable with Warrants 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 December 31, 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. There was no unamortized discount related to these stock warrants as of December 31, 2020 and December 31, 2019, and no stock warrant amortization expense was recorded to interest expense during the years ended December 31, 2020 and 2019. F-21 v |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 12 Months Ended |
Dec. 31, 2020 | |
DERIVATIVE LIABILITY | |
NOTE 9. 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 were carried on the Company’s balance sheet at fair value. The derivative liability was 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 was adjusted by the change. The Company fair valued 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 amounts of these notes were settled and transferred to the APA Note and a loss on debt extinguishment of $273,462 was recognized during the year ended December 31, 2020. The fair value of the embedded derivative recorded on the balance sheet as a liability was none and $60,650 at December 31, 2020 and December 31, 2019, respectively. Utilizing level 3 inputs, the Company recorded a fair market value gain of $60,650 and $4,150 for the years ended December 31, 2020 and 2019, respectively. 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 December 31, 2020 $ 0 |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 31, 2020 | |
COMMON STOCK | |
NOTE 10. COMMON STOCK | The Company’s common stock transactions for the year ended December 31, 2019 consists of the following: 1,065,982 shares were issued to non-related parties for $39,000 in cash. 420,926 shares were issued for the conversion of $595,500 of accrued executive compensation owed to a related party at $0.0143 per share. A related party gain of $535,500 was recorded as additional paid-in capital. 1,038,339 shares were issued for the conversion of $152,781 of related party debt from $0.1430 to $0.1497 per share. 1,038,339 stock warrants were settled along with the related party debt. 417,491 shares were issued to related parties in exchange for 1,388,575 shares of the Company’s Series A Convertible Preferred Stock at $3.326 per share. A related party gain of $1,329,561 was recorded as additional paid-in capital. The Company’s common stock transactions for the year ended December 31, 2020 consists of the following: 1,025 shares were issued at $20.29 per share to a non-related party as compensation for services provided. 72,159 shares were issued for services provided under an Employment Agreement with Kevin Moore dated October 25, 2019. 454,097 shares were issued for the conversion of $65,728 of related parties’ debt from $0.1530 to $0.13304 per share pursuant to terms of the convertible promissory notes. 454,097 stock warrants were settled along with the related party debt. 12,000,000 shares were issued to complete the Transaction with IDTEC that was accounted for as an asset purchase. The shares were issued at a value of $27,120,000. 159,395 shares were issued to non-related parties for the conversion of approximately $266,000 of accounts payable and accrued expenses from $0.5821 to $3.326 per share. The Company recorded a net gain of approximately $62,000 resulting from the stock issuance. 260,150 shares were issued to related parties for the conversion of $852,196 of related party payables from $1.115 to $3.326 per share. A related party gain of $272,299 was recorded as additional paid-in capital. 648,739 shares were issued to related parties for the conversion of $622,004 of debt from $0.9146 to $3.326 per share. The Company recorded $143,660 of loss on debt extinguishment and a related party gain of $124,291 was recorded as additional paid in-capital as a result of the stock issuance. 70,448 shares were issued to non-related parties for the conversion of $65,391 of debt at $3.326 per share. The Company recorded $41,665 of loss resulting from the stock issuance. 3,103,028 shares were issued to a related party for the conversion of $1,551,514 of debt under the terms of a convertible promissory note. The note converted at $0.50 per share. 2,700,000 shares were issued to a related party under the terms governing the shares of Series A-1 Convertible Preferred Stock. In addition, as a result of the conversion of the Series A-1 Convertible Preferred Stock we owed accrued dividends totaling $107,880, which we could pay in cash or in shares of our common stock based on the price of common stock on the applicable dividend dates. Our management and Board of Directors elected to pay the accrued dividends in shares of common stock. Based on the price of the common stock on the applicable dividend dates, we owed 43,169 shares of common stock in full satisfaction of the accrued dividends. As of December 31, 2020, 43,169 shares were recorded in common stock subscriptions payable and were issued on January 6, 2021. |
PREFERRED STOCK
PREFERRED STOCK | 12 Months Ended |
Dec. 31, 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”), an entity controlled by a beneficial owner of the Company, and its assignee. The Company desired 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. During 2020, the authorized shares were increased to 2,700,000 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 August 23, 2019, the Company entered into a Share Exchange Agreement (the “Lanphere” SEA) with Michael Lanphere, a beneficial owner of the Company, under which the Company agreed to issue 156,537 shares of its common stock in exchange for 520,643 shares of the Company’s Series A Convertible Preferred Stock owned by Mr. Lanphere. The Series A Convertible Preferred Stock were exchanged for the Company’s common shares at a price of $3.326 per share and were issued on or about August 28, 2019. The fair value of the common shares was $22,127. Per ASC 470-50-40-2, debt modification and extinguishment transactions between related parties are in essence a capital contribution from a related party. As a result, rather than recording a gain on extinguishment of debt, the Company recorded $498,516 to additional paid-in capital. On August 23, 2019, the Company entered into a Share Exchange Agreement (the “Justus” SEA) with Vernon Justus, a shareholder, under which the Company agreed to issue 260,954 shares of its common stock in exchange for 867,932 shares of the Company’s Series A Convertible Preferred Stock owned by Mr. Justus. The Series A Convertible Preferred Stock were exchanged for the Company’s common shares at a price of $3.326 per share and were issued on or about August 28, 2019. The fair value of the common shares was $36,887. Per ASC 470-50-40-2, debt modification and extinguishment transactions between related parties are in essence a capital contribution from a related party. As a result, rather than recording a gain on extinguishment of debt, the Company recorded $831,045 to additional paid-in capital. 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 a beneficial owner of the Company, under which SOBR SAFE agreed to acquire 1,000,000 shares of our Series A-1 Convertible Preferred Stock in exchange for $1,000,000 (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019. On May 7, 2020, the Company amended a Convertible Preferred Stock Investment Agreement granting the exclusive right to SOBR SAFE to purchase up to 2,700,000 shares. On July 2, 2020, the Company executed Amendment No. 2 to the Stock Investment Agreement which provides that the full amount of each dividend due on a dividend payment date, even if not declared, shall be paid to any holder regardless of the date on which the holder acquired the stock. On December 7, 2020, we sent a Notice of Automatic Conversion and Calculation of Dividend Shares to SOBR SAFE notifying them that under the terms governing the shares of Series A-1 Convertible Preferred Stock the 2,700,000 shares of Series A-1 Convertible Preferred Stock owned by SOBR SAFE automatically converted into 2,700,000 shares of our common stock. In addition, as a result of the conversion of the Series A-1 Convertible Preferred Stock we owed SOBR SAFE accrued dividends totaling $107,880, which we could pay in cash or in shares of our common stock based on the price of common stock on the applicable dividend dates. Our management and Board of Directors elected to pay SOBR SAFE the accrued dividends in shares of our common stock. |
STOCK SUBSCRIPTIONS PAYABLE
STOCK SUBSCRIPTIONS PAYABLE | 12 Months Ended |
Dec. 31, 2020 | |
STOCK SUBSCRIPTIONS PAYABLE | |
NOTE 12. STOCK SUBSCRIPTIONS PAYABLE | The Company has stock subscriptions payable of $253,688 payable with 147,587 of its common shares of which $111,024 is payable to related parties with 60,087 of its common shares as of December 31, 2020 and $79,624 payable to related parties with 60,087 of its common stock at December 31, 2019. The Company recorded a related party gain of none and $39,992 related to the outstanding stock subscriptions payable during the years ended December 31, 2020 and 2019, respectively. The Company had no preferred stock subscriptions payable as of December 31, 2020. The Company has preferred stock subscriptions payable due to a related party of $1,000,000 convertible into 1,000,000 of its 8% Series A-1 Convertible Preferred shares as of December 31, 2019. |
STOCK WARRANTS AND STOCK OPTION
STOCK WARRANTS AND STOCK OPTIONS | 12 Months Ended |
Dec. 31, 2020 | |
STOCK WARRANTS AND STOCK OPTIONS | |
NOTE 13. 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-Scholes 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 were 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 beneficial conversion feature, 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 December 31, 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”), an entity controlled by a beneficial owner of the Company. FCV set up a special purpose vehicle (“SPV”) or SOBR SAFE, LLC, an entity controlled by a beneficial owner of the Company, 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 December 31, 2020 and December 31, 2019 are 144,317 and 144,317, respectively. On May 4,2020, the Company entered into an agreement with a vendor to provide investor relations services. Under the terms of the agreement, we issued warrants to purchase up to 120,000 shares of our common stock at an exercise price of $2.00 per share. The warrants expire five years after the date of issuance. Approximately $220,000 of expense was recognized for the warrants issued for the services provide by the vendor. On June 5, 2020, upon 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, (see Note 3). The total outstanding balance of all non-employee stock warrants in the Company is 584,317 and 598,414 at December 31, 2020 and December 31 2019, respectively. There were 440,000 non-employee detached free-standing stock warrants granted during the year ended December 31, 2020 and 916,579 non-employee detached free-standing stock warrants granted during the year ended December 31, 2019. The fair value of these non-employee stock warrants granted during the years ended December 31, 2020 and 2019 totaled $915,124 and $160,544, respectively, and were determined using the Black-Scholes option pricing model based on the following assumptions: Dec. 31, 2020 Dec. 31, 2019 Exercise Price $ 0.50-$2.00 $ 0.1330-$1.0394 Dividend Yield 0 % 0 % Volatility 153%-154% 134% - 167% Risk-free Interest Rate 0.19%- 0.29% 1.69% – 2.40% Life of Warrants 5 Years .038-5 Years The following table summarizes the changes in the Company’s outstanding warrants during the years ended December 31, 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 916,579 $ 0.06 - 0.2062 3.97 Years $ 0.2860 $ 2,022,912 Warrants Exercised (1,038,339 ) $ 0.1430 - 0.1497 $ 0.1463 Warrants Expired (1,504 ) $ 0.6319 $ 0.6319 Balance at December 31, 2019 598,414 $ .13304 - 1.039375 3.97 Years $ 0.3592 $ 1,276,870 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 $ 0.3592 $ 1,276,870 Warrants Granted 440,000 $ 0.50-2.00 4.41 Years $ 0.9091 $ 898,000 Warrants Exercised (454,097 ) $ 0.13304 - 0.15299 $ 0.1451 Warrants Expired - Balance at December 31, 2020 584,317 $ 0.50 – 2.00 3.80 Years $ 0.9413 $ 1,173,737 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 December 31, 2020 and December 31, 2019, the Company has granted stock options to acquire 2,521,922 and 2,285,028 shares of common stock under the plan, respectively. As of December 31, 2020, the plan has1,202,168 vested shares and1,319,753 non-vested shares. As of December 31, 2019, the plan had 539,847 vested shares and 1,745,181 non-vested shares. As of December 31, 2020 and December 31, 2019 the plan has options available to be issued of 1,326,545 and 1,563,439, respectively. The stock options are held by our officers, directors, employees, and certain key consultants. During 2020, under the 2019 Equity Incentive Plan the Company granted stock options and units to acquire approximately 236,000 shares of its common stock at exercise prices ranging from $1.645 to $3.30 to certain employees and key consultants. The fair value of the options granted was approximately $515,000. The stock options vest monthly and quarterly over 1 to 3-year terms. A total of 15,000 stock options were vested as of December 31, 2020. None of the vested stock options have been exercised and no shares have been issued as December 31, 2020. Additionally, the Company granted stock options to acquire 1,894 shares of its common stock, in addition to the 48,106 options granted to key consultants on October 25, 2019 for a total of 50,000 shares of its common stock in accordance with the Company’s agreements with the consultants. The stock options stock exercise price is $0.2635. The stock options vest over a one-year period beginning January 1, 2020 and have a five-year term. A total of 50,000 and 0 stock options were vested at December 31, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of December 31, 2020. For the years ended December 31, 2020 and 2019, the Company recorded $239,478 and $95,566, respectively, of share-based compensation expense related to the stock options. The unrecognized compensation expense as of December 31, 2020 was approximately $650,000 for non-vested share-based awards to be recognized over periods of approximately three to seven years. In applying the Black-Scholes options pricing model, assumptions used to compute the fair value of the stock options granted during the year ended December 31, 2020 and 2019 were as follows: December 31, 2020 December 31, 2019 Exercise Price $ 1.645-3.30 $ 0.026-1.039 Dividend Yield 0 % 0 % Expected Volatility 162%-181 % 133%-146 % Risk-free Interest Rate 0.19%-0.43 % 1.61%-1.70 % Expected Life 1- 2.7 years 2.0-7.17years The following table summarizes the changes in the Company’s outstanding stock options during the years ended December 31, 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 53,368 $ 0.1497 – 8.31 2.32 Years $ 0.2761 $ - Options Granted 2,381,239 $ 0.26341-1.0393 9.00 Years $ 0.2960 $ 5,238,080 Options Exercised - - Options Cancelled (45,100 ) $ 0.1497 $ 0.1497 Options Expired (8,268 ) $ 0.2328-8.31 9.00 Years $ 0.9678 Balance at December 31, 2019 2,381,239 $ 0.2634 – 1.039 9.00 Years $ 0.2761 $ 5,238,080 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 9.00 Years $ 0.2761 $ 5,238,080 Options Granted 236,894 $ 0.2635–3.300 1.84 Years $ 2.6661 $ 67,265 Options Exercised (45,906 ) $ 1.039 Options Cancelled - - Options Expired - - Balance at December 31, 2020 2,572,227 $ 0.26342–3.300 7.45 Years $ 0.4999 $ 6,302,277 Exercisable at December 31, 2019 539,847 $ 0.2634–1.03938 8.2 Years $ 0.4 $ 1,129,786 Exercisable at December 31, 2020 1,252,474 $ 0.26342–3.300 7.4 Years $ 0.3165 $ 3,299,006 Executive Stock Options The Company has 2,521,922 outstanding executive stock options exercisable at $0.26341 to $3.30 per share with a weighted average remaining contractual life of 7.5 years as of December 31, 2020 and 2,285,028 outstanding executive stock options exercisable at $0.26341 per share with a weighted average remaining contractual life of 9 years 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 $0.2635 and vest quarterly over a one-year period commencing January 1, 2020. The stock options have a five-year term. A total of 24,053 and 0 stock options were vested as of December 31, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of December 31, 2020. On October 25, 2019, the Company granted Nick Noceti, the Company’s former 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 $0.2635 and vest quarterly over a two-year period commencing January 1, 2020. The stock options have a five-year term. A total of 12,026 and 0 stock options were vested as of December 31, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of December 31, 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 $0.2635. The stock options vest in 36 equal monthly installments of 29,398 shares during the three-year term of his Employment Agreement. A total of411,572 and 58,796 stock options were vested as of December 31, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of December 31, 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 $0.2635. 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. A total of 521,146 and 240,521 stock options were vested as of December 31, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of December 31, 2020 or December 31, 2019. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 14. 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 that is between $2,800 - $2,900 per month and ended on October 31, 2020. The lease has been renewed for another twelve months under the same general terms and conditions. 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 $63,978 and $64,679 for the years ended December 31, 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 December 2020. As of December 31, 2020, the Company has accrued $11,164 plus accrued interest of approximately $1,000. In the event we pay any money related to this lawsuit, IDTEC agreed, in connection with us closing the asset purchase transaction with IDTEC, to pay the amount for us in exchange for shares of our common stock. 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 of approximately $53,000, which has been accrued as of December 31, 2020 to our ex-employee for unpaid wages under these Orders. On March 8, 2021 we received an Acknowledgement of Satisfaction of Judgement-Full by the California Court that the judgement has been settled with a payment of approximately $83,000 including accrued interest. In the event we pay any money related to this lawsuit, IDTEC agreed, in connection with us closing the asset purchase transaction with IDTEC, to pay the amount for us in exchange for shares of our common stock. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
NOTE 15. INCOME TAXES | Deferred income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses. These loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur. For the years ended December 31, 2020 and 2019, the Company incurred net losses and therefore has no tax liability. The Company began operations in 2007 and has net operating loss carry-forwards of approximately $13,346,000 that will be carried forward and can be used through the year 2040 to offset future taxable income. In the future, the cumulative net operating loss carry forward for income tax purposes may differ from the cumulative financial statement loss due to timing differences between book and tax reporting. At December 31, 2020 and 2019, the Company has net operating loss carry forwards of approximately $13,346,000 and $9,634,000, respectively, that may be offset against future taxable income, if any. These carry-forwards are subject to review by the Internal Revenue Service. As of December 31, 2020 and 2019, the deferred tax asset of approximately $2,830,000 and $1,832,000, respectively, created by the net operating losses has been offset by a 100% valuation allowance because the likelihood of realization of the tax benefit cannot be determined. The change in the valuation allowance in 2020 and 2019 was approximately $998,000 and $187,000, respectively. There is no current or deferred tax expense for the years ended December 31, 2020 and 2019. The Company has not filed its tax returns for the years ended 2012 through 2020; however, management believes there are no taxes due as of December 31, 2020 and 2019. The Company includes interest and penalties arising from the underpayment of income taxes in general and administrative expense in the consolidated statements of operations. The provision for Federal income tax consists of the following for the years ended December 31, 2020 and 2019: December 31, December 31, 2020 2019 Income tax benefit attributable to: Net loss $ (29,982,222 ) $ (1,249,032 ) Permanent differences 1,830,697 313,778 Valuation allowance 28,151,525 935,254 Net provision for income tax $ - $ - The cumulative tax effect at the expected federal tax rate of 21% of significant items comprising our net deferred tax amount is as follows on December 31, 2020 and 2019: December 31, December 31, 2020 2019 Deferred tax asset attributable to: Net operating loss carry forward $ 2,163,000 $ 1,832,000 Valuation allowance (2,163,000 ) (1,832,000 ) Net deferred tax asset $ - $ - The cumulative tax effect at the expected state tax rate of 5% of significant items comprising our net deferred tax amount is as follows on December 31, 2020 and 2019: December 31, December 31, 2020 2019 Deferred tax asset attributable to: Net operating loss carry forward $ 667,000 $ 482,000 Valuation allowance (667,000 ) (482,000 ) Net deferred tax asset $ - $ - Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $13,304,000 for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be further limited to use in future years. The Company has identified the United States Federal tax returns as its “major” tax jurisdiction. The United States Federal tax return years 2012 – 2020 are still subject to tax examination by the United States Internal Revenue Service; however, we do not currently have any ongoing tax examinations. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 16. SUBSEQUENT EVENTS | The Company has evaluated subsequent events for recognition and disclosure through March 31, 2021, which is the date the consolidated financial statements were available to be issued. On January 6, 2021, the Company issued 43,169 shares of its common stock to SOBR Safe, LLC in full satisfaction of accrued dividends resulting from the December 2020 conversion of the Series A-1 Convertible Preferred Stock into common shares. On January 15, 2021, the Company initiated a Private Offering (the “Offering”) of up to 40 Units ($2,000,000) with each Unit consisting of one $50,000 principal amount secured convertible debenture, convertible at $3.00 per share (“Secured Debentures”), and a warrant to purchase 25,000 shares of the Company’s common stock (the “Debenture Warrants”). The Secured Debentures will mature 24 months after issuance. The Secured Debentures will not be redeemable but contain an automatic conversion feature. Interest on the Secured Debentures will accrue at a rate of 12% per annum, beginning on the date we have access to the investor’s funds. At the date of their investment in the Offering, investors may elect to have the interest due under the Secured Debenture paid in cash monthly or have the interest accrue and be payable on the maturity date of the Secured Debenture. For investors that elect to accrue the interest due under the Secured Debenture, the interest will be paid in cash or may be converted into shares of our common stock under the same terms as the principal amount on the maturity date. The Secured Debentures will be convertible at any time, and from time to time, by the holder beginning on the date of issuance, into shares of our common stock. The Secured Debentures will be convertible at $3.00 per share (the “Conversion Price”); provided, however, that the right of conversion will be limited by the terms of the Secured Debentures to the extent necessary to ensure that each Secured Debenture holder will never beneficially own more than 4.9% of our class of common stock at any one time while any portion of the holder’s Secured Debenture remains outstanding. The repayment of the Secured Debentures will be secured by the Company’s patent and patent applications. The Debenture Warrants will be exercisable at any time, and from time to time, beginning six months after issuance and expiring two years after issuance, into shares at an exercise price of $3.00 per share. The Debenture Warrants contain a repurchase right by the Company. The shares underlying the Secured Debentures and Debenture Warrants will have registration rights. Units may be purchased in increments of $50,000, with the minimum investment being one Unit for $50,000. The Offering will be made on a continuous basis until 5:00 p.m. on March 31, 2021, which may be extended one-time by our Board of Directors until April 30, 2021 (the “Termination Date”), unless earlier terminated or canceled. There will be no closing of the Offering until a minimum of $500,000 is raised (the “Minimum Offering”). After an initial closing is held, offers to purchase Units will be aggregated for subsequent closings to be held on a monthly basis until the maximum of $2,000,000 has been raised or until the Termination Date, whichever is earlier. The Offering may be canceled by the Company at any time and will in any event be canceled if no closing has occurred before the Termination Date. In the event the offer to purchase Units is rejected or the Offering is canceled, then the amounts remitted will be promptly returned without interest or deduction. As of the date of this report the Company has received $1,100,000 of Offering proceeds. |
ORGANIZATION, OPERATIONS AND _2
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | The accompanying audited 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”) for the presentation of annual financial information. In management’s opinion, the audited consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position for the years ended December 31, 2020 and December 31, 2019, and results of operations and cash flows for the years ended December 31, 2020 and December 31, 2019. |
Principles of consolidation | The accompanying audited 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 audited financial statements. |
Use of Estimates | The preparation of audited 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. |
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, related party payables, notes payable, convertible debentures, and other liabilities. 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 December 31, 2020 and December 31, 2019: December 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 |
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 December 31, 2020 and December 31, 2019. |
Prepaid Expenses | Amounts incurred in advance of contractual performance or coverage periods are recorded as prepaid assets and recognized as expense in the period service or coverage is provided. |
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 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 December 31, 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. |
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 $633,050 and $12,787 during the years ended December 31, 2020 and December 31, 2019, respectively. |
Advertising and Marketing Costs | Advertising and marketing costs are charged to operations as incurred. Advertising and marketing costs were $96,637 and $3,724 during the years ended December 31, 2020 and December 31, 2019, respectively. |
Income tax | The Company accounts for income taxes pursuant to 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 a deferred tax asset of approximately $2,830,000 and $1,832,000 that is offset by a 100% valuation allowance at December 31, 2020 and December 31, 2019, respectively. Therefore, the Company has not recorded any deferred tax assets or liabilities at December 31, 2020 and December 31, 2019. |
Net loss per share | Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share gives the effect to all dilutive potential common shares outstanding during the period, including stock options, warrants and convertible instruments. Diluted net loss per share excludes all potentially issuable shares if their effect is anti-dilutive. Because the effect of the Company’s dilutive securities is anti-dilutive, diluted net loss per share is the same as basic loss per share for the periods presented. |
Concentration of Credit Risk | Certain financial instruments potentially subject the Company to concentrations of credit risk. Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Cash held in operating accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”), insurance limits. Accounts at each institution are insured by the FDIC up to $250,000. While the Company monitors cash balances in our operating accounts on a regular basis and adjust the balances as appropriate, these balances could be impacted if the underlying financial institutions fail. To date, the Company has experienced no loss or lack of access to our cash; however, the Company can provide no assurances that access to our cash will not be impacted by adverse conditions in the financial markets. At December 31, 2020 and December 31, 2019, the Company had $0 and $431,759 in excess of the FDIC insured limit, respectively. |
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 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, In October 2020, the FASB issued ASU No. 2020-08, Codification Improvements to Subtopic 310-20, Receivables-Nonrefundable Fees and Other Costs, Premium Amortization on Purchased Callable Debt Securities |
ORGANIZATION OPERATIONS AND SUM
ORGANIZATION OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of fair value of assets and liabilities | December 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ - December 31, 2019 Level 1 Level 2 Level 3 Derivative liabilities $ - $ - $ 60,650 |
ASSET PURCHASE (Table)
ASSET PURCHASE (Table) | 12 Months Ended |
Dec. 31, 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 notes payable) $ 29,222,955 |
PREPAID EXPENSES (Tables)
PREPAID EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PREPAID EXPENSES | |
Schedule of prepaid expenses | December 31, 2020 December31, 2019 Insurance $ 3,370 $ - Consulting services 111,860 7,343 Other prepaid expenses - 1,711 Prepaid expenses $ 115,230 $ 9,054 |
PROPERTY AND EQUIPMENT (Table)
PROPERTY AND EQUIPMENT (Table) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT | |
Summary of property plant and equipment | December 31, 2020 Robotics and testing equipment $ 46,200 Office furniture and equipment 1,525 47,725 Accumulated depreciation (7,340 ) Net property and equipment disposed (40,385 ) Property and equipment, net $ 0 |
INTANGIBLE ASSETS (Table)
INTANGIBLE ASSETS (Table) | 12 Months Ended |
Dec. 31, 2020 | |
INTANGIBLE ASSETS | |
Summary of Intangible Assets | Gross Carrying Amount Accumulated Amortization Net Intangible Asset Amortization Period (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 224,854 $ 3,629,821 10 |
Schedule of estimated future amortization expense | 2021 2022 2023 2024 2025 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,702,486 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
NOTES PAYABLE | |
Schedule of notes payables - related parties | December 31, 2020 December31, 2019 Convertible Notes Payable $ - $ 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 $ 11,810 $ 760,886 |
Schedule of notes payables - non related parties | December 31, 2020 December 31, 2019 Convertible Notes Payable $ 56,683 $ 143,136 Conventional Non-Convertible Notes Payable 42,500 21,438 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Net Non-Related Party Notes Payable $ 104,183 $ 169,574 |
DERIVATIVE LIABILITY (Tables)
DERIVATIVE LIABILITY (Tables) | 12 Months Ended |
Dec. 31, 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 December 31, 2020 $ 0 |
STOCK WARRANTS AND STOCK OPTI_2
STOCK WARRANTS AND STOCK OPTIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
STOCK WARRANTS AND STOCK OPTIONS | |
Schedule of fair value of non-employee stock/warrants | Dec. 31, 2020 Dec. 31, 2019 Exercise Price $ 0.50-$2.00 $ 0.1330-$1.0394 Dividend Yield 0 % 0 % Volatility 153%-154% 134% - 167% Risk-free Interest Rate 0.19%- 0.29% 1.69% – 2.40% Life of Warrants 5 Years .038-5 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 916,579 $ 0.06 - 0.2062 3.97 Years $ 0.2860 $ 2,022,912 Warrants Exercised (1,038,339 ) $ 0.1430 - 0.1497 $ 0.1463 Warrants Expired (1,504 ) $ 0.6319 $ 0.6319 Balance at December 31, 2019 598,414 $ .13304 - 1.039375 3.97 Years $ 0.3592 $ 1,276,870 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 $ 0.3592 $ 1,276,870 Warrants Granted 440,000 $ 0.50-2.00 4.41 Years $ 0.9091 $ 898,000 Warrants Exercised (454,097 ) $ 0.13304 - 0.15299 $ 0.1451 Warrants Expired - Balance at December 31, 2020 584,317 $ 0.50 – 2.00 3.80 Years $ 0.9413 $ 1,173,737 |
Schedule of fair value of stock options | December 31, 2020 December 31, 2019 Exercise Price $ 1.645-3.30 $ 0.026-1.039 Dividend Yield 0 % 0 % Expected Volatility 162%-181 % 133%-146 % Risk-free Interest Rate 0.19%-0.43 % 1.61%-1.70 % Expected Life 1- 2.7 years 2.0-7.17years |
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 53,368 $ 0.1497 – 8.31 2.32 Years $ 0.2761 $ - Options Granted 2,381,239 $ 0.26341-1.0393 9.00 Years $ 0.2960 $ 5,238,080 Options Exercised - - Options Cancelled (45,100 ) $ 0.1497 $ 0.1497 Options Expired (8,268 ) $ 0.2328-8.31 9.00 Years $ 0.9678 Balance at December 31, 2019 2,381,239 $ 0.2634 – 1.039 9.00 Years $ 0.2761 $ 5,238,080 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 9.00 Years $ 0.2761 $ 5,238,080 Options Granted 236,894 $ 0.2635–3.300 1.84 Years $ 2.6661 $ 67,265 Options Exercised (45,906 ) $ 1.039 Options Cancelled - - Options Expired - - Balance at December 31, 2020 2,572,227 $ 0.26342–3.300 7.45 Years $ 0.4999 $ 6,302,277 Exercisable at December 31, 2019 539,847 $ 0.2634–1.03938 8.2 Years $ 0.4 $ 1,129,786 Exercisable at December 31, 2020 1,252,474 $ 0.26342–3.300 7.4 Years $ 0.3165 $ 3,299,006 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of provision for income tax | December 31, December 31, 2020 2019 Income tax benefit attributable to: Net loss $ (29,982,222 ) $ (1,249,032 ) Permanent differences 1,830,697 313,778 Valuation allowance 28,151,525 935,254 Net provision for income tax $ - $ - |
Schedule of deferred tax asset | December 31, December 31, 2020 2019 Deferred tax asset attributable to: Net operating loss carry forward $ 2,163,000 $ 1,832,000 Valuation allowance (2,163,000 ) (1,832,000 ) Net deferred tax asset $ - $ - The cumulative tax effect at the expected state tax rate of 5% of significant items comprising our net deferred tax amount is as follows on December 31, 2020 and 2019: December 31, December 31, 2020 2019 Deferred tax asset attributable to: Net operating loss carry forward $ 667,000 $ 482,000 Valuation allowance (667,000 ) (482,000 ) Net deferred tax asset $ - $ - |
ORGANIZATION, OPERATIONS AND _3
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Level 1 [Member] | ||
Derivative liabilites | $ 0 | $ 0 |
Fair value assets and liabilities | 0 | 0 |
Level 2 [Member] | ||
Derivative liabilites | 0 | 0 |
Fair value assets and liabilities | 0 | 0 |
Level 3 [Member] | ||
Derivative liabilites | 0 | 0 |
Fair value assets and liabilities | $ 0 | $ 60,650 |
ORGANIZATION, OPERATIONS AND _4
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
May 21, 2020 | Mar. 23, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Research and development costs | $ 633,050 | $ 12,787 | ||
Ownership interest, percentage | 1.38% | 1.38% | ||
Advertising and marketing costs | $ 96,637 | $ 3,724 | ||
FDIC insured limit | 250,000 | |||
FDIC exceed amount | 0 | 431,759 | ||
Deferred tax asset | $ 2,830,000 | $ 1,832,000 | ||
Valuation allowance, percentage | 100.00% | |||
Common stock, shares authorized | 100,000,000 | 100,000,000 | ||
Common stock, par value | $ 0.00001 | $ 0.00001 | ||
Annual Meeting of Shareholders [Member] | ||||
Common stock, shares authorized | 100,000,000 | 800,000,000 | 800,000,000 | |
Common stock, par value | $ 0.00001 | $ 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 ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accumulated deficit | $ (49,601,220) | $ (19,511,168) |
Net cash used in operating activities | $ (2,191,533) | $ (543,956) |
Private Offering [Member] | January 15, 2021 [Member] | ||
Termination date description | The Company initiated a Private Offering (the “Offering”) of up to 40 Units ($2,000,000) with each Unit consisting of one $50,000 principal amount secured convertible debenture, convertible at $3.00 per share, and a Warrant to purchase 25,000 shares of the Company’s common stock at $3.00 per share. The Secured Debentures carry interest at 12% and mature 24 months after issuance. The Warrants are exercisable six months after issuance and expire 24 months after issuance . The Offering will be made on a continuous basis until March 31, 2021, which may be extended one-time by our Board of Directors until April 30, 2021 (the “Termination Date”), unless earlier terminated or canceled. There will be no closing of the Offering until a minimum of $500,000 is raised. After an initial closing is held, offers to purchase Units will be aggregated for subsequent closings to be held on a monthly basis until the maximum of $2,000,000 has been raised or until the Termination Date, whichever is earlier. | |
Offering amount | $ 1,100,000 |
ASSET PURCHASE (Details)
ASSET PURCHASE (Details) | Jun. 05, 2020USD ($) |
ASSET PURCHASE | |
Property and equipment | $ 47,725 |
Intangible assets | 29,175,230 |
Total assets | 29,222,955 |
Net purchase (fair value of stock issued, warrants and notes payable) | $ 29,222,955 |
ASSET PURCHASE (Details Narrati
ASSET PURCHASE (Details Narrative) - USD ($) | Jun. 05, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Liability required | $ 125,000 | $ 158,000 | |
Exercise price per share | $ 0.50 | ||
Assets purchase upon shares issued | 29,222,955 | 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 | $ 0 | |
Fair value of warrants issued | $ 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 | ||
Interest rate | 10.00% | ||
Convertible Notes Payable | $ 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 $125,000 in current liabilities. |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
ASSET PURCHASE | ||
Insurance | $ 3,370 | $ 0 |
Consulting services | 111,860 | 7,343 |
Other prepaid expenses | 0 | 1,711 |
Prepaid expenses | $ 115,230 | $ 9,054 |
PREPAID EXPENSES (Details Narra
PREPAID EXPENSES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Common stock shares issued for cash, value | $ 39,000 | |
Stock- based compensation | $ 273,443 | $ 44,082 |
Two Consulting Agreements [Member] | ||
Common stock shares issued for cash, value | $ 142,714 | |
Common stock shares issued for cash, shares | 87,500 | |
Stock- based compensation | $ 33,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Property and equipment, gross | $ 47,725 |
Accumulated depreciation | (7,340) |
Net property and equipment disposed | (40,385) |
Property and equipment, net | 0 |
Robotics and testing equipment [Member] | |
Property and equipment, gross | 46,200 |
Office furniture and equipment [Member] | |
Property and equipment, gross | $ 1,525 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Depreciation | $ 7,340 | $ 0 |
Property, Plant and Equipment [Member] | ||
Estimated useful life | 3 years |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible assets, net | $ 3,629,821 | $ 0 |
Intellectual Technology [Member] | ||
Amortization Period | 10 years | |
Intangible assets, gross | $ 3,854,675 | |
Accumulated amortization | 224,854 | |
Intangible assets, net | $ 3,629,821 |
INTANGIBLE ASSETS (Details 1)
INTANGIBLE ASSETS (Details 1) | Dec. 31, 2020USD ($) |
INTANGIBLE ASSETS | |
2021 | $ 385,467 |
2022 | 385,467 |
2023 | 385,467 |
2024 | 385,467 |
2025 | 385,467 |
Thereafter | $ 1,702,486 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
INTANGIBLE ASSETS | ||
Amortization expense | $ 224,854 | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Jun. 05, 2020 | 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 | Oct. 25, 2019 | Aug. 23, 2019 | Dec. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Aug. 28, 2019 | Mar. 08, 2017 | Jul. 01, 2015 |
Common stock conversion price | $ 0.09 | ||||||||||||||||||
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 | ||||||||||||||||
Attorney fees and costs | $ 214,334 | ||||||||||||||||||
Exercise price per share | $ 0.50 | ||||||||||||||||||
Stock option expense | $ 239,478 | $ 95,567 | |||||||||||||||||
Options vested | 320,000 | ||||||||||||||||||
Common stock, shares issued | 6,452,993 | 25,922,034 | 6,452,993 | ||||||||||||||||
Monthly rent | $ 63,978 | $ 64,679 | |||||||||||||||||
General and administrative expense | 632,426 | 232,178 | |||||||||||||||||
Additional paid-in capital | $ 15,971,392 | 52,693,974 | 15,971,392 | ||||||||||||||||
Gain on related party debt conversion | $ 224,166 | 0 | |||||||||||||||||
Debt conversion, converted instrument, per share price | $ 0.0143 | ||||||||||||||||||
Accrued interest | 419,836 | $ 313,032 | 419,836 | ||||||||||||||||
Related party payables converted to capital | 579,814 | 59,500 | |||||||||||||||||
Kevin Moore [Member] | |||||||||||||||||||
Common stock acquire | $ 1,058,329 | ||||||||||||||||||
Exercise price per share | $ 0.2635 | ||||||||||||||||||
Stock option expense | $ 79,557 | $ 14,080 | |||||||||||||||||
Options vested | 352,776 | 58,796 | |||||||||||||||||
Expected lives | 5 years | ||||||||||||||||||
Annual base salary | $ 213,000 | ||||||||||||||||||
Common stock, shares issued | 24,053 | ||||||||||||||||||
Stock options description | Stock options to vest in 36 equal monthly installments of 977,777 shares during the three-year term of the Moore Agreement. | ||||||||||||||||||
Fair market value of common stock | 110.00% | ||||||||||||||||||
Kevin Moore [Member] | Employment Agreement [Member] | |||||||||||||||||||
Common stock acquire | $ 1,058,328 | ||||||||||||||||||
Exercise price per share | $ 0.2634 | ||||||||||||||||||
Expected lives | 3 years | ||||||||||||||||||
Lanphere Law Group [Member] | December 3 2014 [Member] | |||||||||||||||||||
Accrued interest | $ 38,199 | ||||||||||||||||||
Debt amount | $ 74,672 | ||||||||||||||||||
Lanphere Law Group [Member] | Lease agreement [Member] | |||||||||||||||||||
Monthly rent | $ 4,100 | ||||||||||||||||||
General and administrative expense | $ 0 | $ 39,315 | |||||||||||||||||
Operating lease term description | The term of this operating lease ran from July 1, 2015 to June 30, 2019. From July 1, 2019 through December 31, 2019, the Company leased the same office space on a month to month basis. Rent expense, including CAM charges, | ||||||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan One [Member] | |||||||||||||||||||
Common stock, shares issued | 273,700 | ||||||||||||||||||
Conversion price | $ 0.133 | ||||||||||||||||||
Reduction in related party debt | $ 66,000 | ||||||||||||||||||
Gain on related party debt conversion | $ 108,000 | ||||||||||||||||||
Price per share | $ 0.153 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 9,520 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | ||||||||||||||||||
Accrued interest | $ 428,668 | 9,508 | $ 0 | 9,508 | |||||||||||||||
Debt amount | $ 214,334 | ||||||||||||||||||
Debt instrument principal value, after forgivness | $ 31,662 | $ 31,662 | 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 | $ 22,585 | |||||||||||||||||
Purchase price of additional shares of common stock | $ 66,000 | ||||||||||||||||||
Common stock, shares, new issue | 180,397 | ||||||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan Three [Member] | |||||||||||||||||||
Reduction in related party debt | $ 714,700 | ||||||||||||||||||
Gain on related party debt conversion | $ 222,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 214,883 | ||||||||||||||||||
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] | |||||||||||||||||||
Reduction in related party debt | $ 169,606 | ||||||||||||||||||
Gain on related party debt conversion | $ 52,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 63,225 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | ||||||||||||||||||
Purchase price of shares issued | $ 210,285 | ||||||||||||||||||
Accrued interest | $ 40,679 | ||||||||||||||||||
Vernon Justus [Member] | Share Exchange Agreement [Member] | |||||||||||||||||||
Convertible preferred stock converted | 867,932 | ||||||||||||||||||
Common stock shares issuable for preferred stock | 260,954 | ||||||||||||||||||
Conversion price | $ 0.133 | $ 3.326 | |||||||||||||||||
Fair value of the common shares | $ 36,887 | ||||||||||||||||||
Additional paid-in capital | $ 831,045 | 831,045 | |||||||||||||||||
Michael Lanphere [Member] | Share Exchange Agreement [Member] | |||||||||||||||||||
Convertible preferred stock converted | 520,643 | ||||||||||||||||||
Common stock shares issuable for preferred stock | 156,537 | ||||||||||||||||||
Conversion price | 0.133 | $ 3.326 | |||||||||||||||||
Fair value of the common shares | $ 22,157 | ||||||||||||||||||
Additional paid-in capital | 498,516 | ||||||||||||||||||
Michael Lanphere [Member] | Stock Purchase Plan [Member] | |||||||||||||||||||
Conversion price | 0.133 | $ 0.1497 | |||||||||||||||||
Common stock shares issuable | 643,438 | ||||||||||||||||||
Reduction in related party debt | $ 9,656 | $ 96,303 | |||||||||||||||||
Reduction in related party debt, principal | 77,927 | ||||||||||||||||||
Reduction in related party debt, interest | 18,376 | ||||||||||||||||||
Gain on related party debt conversion | 2,000 | $ 5,350 | |||||||||||||||||
Warrants to purchase common shares | 454,097 | ||||||||||||||||||
Devadatt Mishal [Member] | Stock Purchase Plan [Member] | |||||||||||||||||||
Conversion price | $ 0.133 | $ 0.1430 | |||||||||||||||||
Common stock shares issuable | 394,901 | ||||||||||||||||||
Reduction in related party debt | 9,656 | $ 56,478 | |||||||||||||||||
Reduction in related party debt, principal | 45,000 | ||||||||||||||||||
Reduction in related party debt, interest | 11,478 | ||||||||||||||||||
Gain on related party debt conversion | 2,000 | $ 657 | |||||||||||||||||
Charles Bennington [Member] | |||||||||||||||||||
Common stock acquire | $ 24,053 | ||||||||||||||||||
Exercise price per share | $ 0.2635 | ||||||||||||||||||
Stock option expense | $ 4,592 | ||||||||||||||||||
Options vested | 0 | 0 | |||||||||||||||||
Expected lives | 5 years | ||||||||||||||||||
Common stock shares issuable | 420,926 | ||||||||||||||||||
Reduction in related party debt | 9,656 | ||||||||||||||||||
Gain on related party debt conversion | $ 2,000 | $ 535,500 | |||||||||||||||||
Debt forgive amount | $ 595,000 | ||||||||||||||||||
Price per share | $ 3.326 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 6,831 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 1.41 | ||||||||||||||||||
Purchase price of shares issued | $ 9,656 | ||||||||||||||||||
Nick Noceti [Member] | |||||||||||||||||||
Common stock acquire | $ 24,053 | ||||||||||||||||||
Exercise price per share | $ 0.2635 | ||||||||||||||||||
Stock option expense | $ 2,271 | ||||||||||||||||||
Options vested | 0 | 0 | |||||||||||||||||
Expected lives | 5 years | ||||||||||||||||||
Reduction in related party debt | $ 127,480 | ||||||||||||||||||
Gain on related party debt conversion | $ 49,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 38,437 | ||||||||||||||||||
Purchase price of shares issued | 127,840 | ||||||||||||||||||
Prakash Gadgil [Member] | Stock Purchase Plan One [Member] | |||||||||||||||||||
Reduction in related party debt | $ 1,950 | ||||||||||||||||||
Gain on related party debt conversion | $ 1,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 586 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | ||||||||||||||||||
Purchase price of shares issued | $ 1,950 | ||||||||||||||||||
Devdatt Mishal [Member] | Stock Purchase Plan One [Member] | |||||||||||||||||||
Reduction in related party debt | $ 270,300 | ||||||||||||||||||
Gain on related party debt conversion | $ 144,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 499,965 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 0.91465 | ||||||||||||||||||
Purchase price of shares issued | $ 456,641 | ||||||||||||||||||
Accrued interest | $ 186,341 | ||||||||||||||||||
Vemon Justus [Member] | Stock Purchase Plan One [Member] | |||||||||||||||||||
Reduction in related party debt | $ 180,001 | ||||||||||||||||||
Gain on related party debt conversion | $ 70,000 | ||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 84,963 | ||||||||||||||||||
Debt conversion, converted instrument, per share price | $ 3.326 | ||||||||||||||||||
Purchase price of shares issued | $ 282,588 | ||||||||||||||||||
Accrued interest | $ 102,587 | ||||||||||||||||||
Gary Graham [Member] | |||||||||||||||||||
Common stock acquire | $ 24,053 | ||||||||||||||||||
Exercise price per share | $ 0.2635 | ||||||||||||||||||
Stock option expense | $ 4,592 | ||||||||||||||||||
Options vested | 0 | ||||||||||||||||||
Expected lives | 5 years | ||||||||||||||||||
Mr. David Gandini [Member] | Employment Agreement [Member] | |||||||||||||||||||
Exercise price per share | $ 0.2635 | ||||||||||||||||||
Stock option expense | $ 54,720 | $ 57,574 | |||||||||||||||||
Options vested | 240,530 | 240,530 | |||||||||||||||||
Annual base salary | $ 185,000 | ||||||||||||||||||
Stock options description | Stock options to vest in 36 equal monthly installments of 666,666 shares during the three-year term of the Gandini Agreement | ||||||||||||||||||
Fair market value of common stock | 110.00% | ||||||||||||||||||
Remaining pre-vesting option shares | 40,091 | ||||||||||||||||||
Stock options term | 10 years | ||||||||||||||||||
Pre-vesting option shares | 240,530 | ||||||||||||||||||
Aggregate of additional option shares | 200,439 | ||||||||||||||||||
Shares acquire | 721,588 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Conventional Non-Convertible Notes Payable | $ 21,438 | |
Net Related Party Notes Payable | $ 11,810 | 760,886 |
Related Party Notes Payable [Member] | ||
Convertible Notes Payable | 0 | 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 | $ 11,810 | $ 760,886 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Net Non-Related Party Notes Payable | $ 104,183 | $ 169,574 |
Non-Related Party Notes Payable [Member] | ||
Convertible Notes Payable | 56,683 | 143,136 |
Conventional Non-Convertible Notes Payable | 42,500 | 21,438 |
Notes Payable with Detached Free-standing Warrants | 5,000 | 5,000 |
Net Non-Related Party Notes Payable | $ 104,183 | $ 169,574 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Dec. 07, 2020 | Jun. 05, 2020 | Nov. 15, 2020 | May 12, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | May 04, 2020 |
Interest expense for non-related party notes | $ 17,415 | $ 56,546 | |||||
Interest expenses for related party notes | 98,313 | 91,845 | |||||
Conventional Non-Convertible Notes Payable | 21,438 | ||||||
Amortization expenses, beneficial conversion feature | 8,656 | 5,920 | |||||
Exercise price | $ 2 | ||||||
Accrued interest | 134,444 | 674,041 | |||||
Gain on related party debt conversion | 224,166 | 0 | |||||
Fair value of embedded conversion feature | $ 0 | 64,800 | |||||
Number of detached free-standing warrants outstanding | 120,000 | ||||||
Note payable conversion price per share | $ 0.0143 | ||||||
Non-Related Party Notes Payable One [Member] | |||||||
Interest rate | 5.00% | ||||||
Accrued interest | $ 22,500 | ||||||
Convertible Notes Payable | 47,500 | ||||||
Convertible non-related party note payable | $ 25,000 | ||||||
Convertible notes, conversion price | $ 2 | ||||||
Gain on related party debt conversion | $ 11,697 | ||||||
Non-Related Party Notes Payable [Member] | |||||||
Convertible notes payable principal | 83,953 | ||||||
Amortization expenses, beneficial conversion feature | 5,920 | 5,920 | |||||
Accrued interest | 82,797 | ||||||
Convertible Notes Payable | $ 56,683 | 143,136 | |||||
Common stock shares exchanged | 20,313 | ||||||
Gain on related party debt conversion | $ 68,000 | ||||||
Purchase price of shares issued | 166,749 | ||||||
Related Party Notes Payable [Member] | |||||||
Conventional Non-Convertible Notes Payable | $ 11,810 | 328,423 | |||||
Default interest rate | 10.00% | ||||||
Shares issued upon conversion of debt | 157,000 | ||||||
Convertible notes payable principal | $ 91,000 | ||||||
Amortization expenses, beneficial conversion feature | 64,800 | ||||||
Accrued interest | 52,119 | 7,689 | |||||
Convertible Notes Payable | 0 | 161,000 | |||||
Fair value of embedded conversion feature | 0 | 56,000 | |||||
Reduction in related party convertible notes | 143,119 | ||||||
Holder [Member] | |||||||
Convertible promissory note | 25,000 | ||||||
Accrued interest | $ 61,875 | ||||||
Convertible promissory note, interest rate | 30.00% | ||||||
Related Party Notes Payable Twenty Four [Member] | |||||||
Accrued interest | $ 40,739 | ||||||
Purchase price of shares issued | 320,858 | ||||||
Convertible Notes Payable | 280,119 | 280,119 | |||||
Fair value of warrants granted | 38,998 | 38,998 | |||||
Interest expense | 8,656 | 37,072 | |||||
Unamortized Discount | $ 0 | 8,656 | |||||
New non-convertible note [Member] | |||||||
Interest rate | 5.00% | ||||||
Gain on non-related party debt extinguishment | $ 61,875 | ||||||
Convertible Notes Payable | $ 47,500 | ||||||
Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | |||||||
Interest rate | 10.00% | ||||||
Accrued interest | $ 63,623 | ||||||
Convertible Notes Payable | 3,938 | ||||||
Gain on related party debt conversion | 14,000 | ||||||
Purchase price of shares issued | 67,561 | ||||||
Unamortized Discount | $ 0 | $ 0 | |||||
Number of detached free-standing warrants outstanding | 5,000 | 5,000 | |||||
Note payable due date | Sep. 11, 2014 | ||||||
Non-Convertible Notes Payable Two [Member] | |||||||
Shares issued upon conversion of debt | 342,399 | ||||||
Convertible debt, conversion, principal amount | $ 316,613 | ||||||
Accrued interest | 232,698 | ||||||
Purchase price of shares issued | 549,311 | ||||||
Reduction in related party convertible notes | 316,613 | ||||||
Conventional Non-Convertible Notes Payable | 11,810 | $ 328,423 | |||||
Principal balance | 316,613 | ||||||
Commercial Bank [Member] | SBA Payroll Protection Loan Program [Member] | |||||||
Proceeds from loan | $ 41,665 | ||||||
Loan interest rate | 1.00% | ||||||
Gain on non-related party debt extinguishment | $ 42,000 | $ 61,875 | |||||
Debt forgiveness | $ 242 | ||||||
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] | |||||||
Convertible notes payable principal | $ 280,119 | ||||||
Common stock shares exchanged | 601,783 | ||||||
Common Stock Purchase Plans [Member] | Four Related Parties [Member] | |||||||
Conventional Non-Convertible Notes Payable | $ 316,613 | ||||||
Accrued interest | $ 232,698 | ||||||
Common stock shares exchanged | 343,000 | ||||||
Reduction in related party non - convertible notes payable | $ 549,311 | ||||||
Convertible APA Note[Member] | |||||||
Interest rate | 10.00% | ||||||
Shares issued upon conversion of debt | 3,103,028 | ||||||
Convertible notes payable principal | $ 1,551,514 | ||||||
Amortization expenses, beneficial conversion feature | $ 1,407,675 | ||||||
Convertible debt, conversion, principal amount | $ 1,485,189 | ||||||
Convertible promissory note | $ 70,000 | ||||||
Exercise price | $ 0.50 | ||||||
Accrued interest | $ 7,689 | ||||||
Minimum [Member] | |||||||
Default interest rate | 7.00% | ||||||
Interest rate | 0.00% | ||||||
Note payable conversion price per share | $ 0.1430 | ||||||
Minimum [Member] | Non-Related Party Notes Payable [Member] | |||||||
Interest rate | 5.00% | ||||||
Note payable due date | Feb. 8, 2012 | ||||||
Note payable conversion price per share | $ 0.0565 | ||||||
Minimum [Member] | Related Party Notes Payable Twenty Four [Member] | |||||||
Interest rate | 7.00% | ||||||
Exercise price | $ 0.1330 | ||||||
Minimum [Member] | Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | |||||||
Interest rate | 5.00% | ||||||
Note payable due date | Jan. 31, 2013 | ||||||
Maximum [Member] | |||||||
Default interest rate | 10.00% | ||||||
Interest rate | 10.00% | ||||||
Note payable conversion price per share | $ 0.1497 | ||||||
Maximum [Member] | Non-Related Party Notes Payable [Member] | |||||||
Interest rate | 30.00% | ||||||
Note payable due date | Mar. 6, 2022 | ||||||
Note payable conversion price per share | $ 10.7619 | ||||||
Maximum [Member] | Related Party Notes Payable Twenty Four [Member] | |||||||
Interest rate | 10.00% | ||||||
Exercise price | $ 0.1530 | ||||||
Maximum [Member] | Non-Convertible Notes Payable [Member] | Non-Related Party Notes Payable [Member] | |||||||
Interest rate | 18.00% | ||||||
Note payable due date | Jun. 9, 2022 |
DERIVATIVE LIABILITY (Details)
DERIVATIVE LIABILITY (Details) | 12 Months Ended |
Dec. 31, 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 ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Risk-free interest rate | 0.13% | |
Expected volatility rate | 180.00% | |
Fair market value gain | $ 60,650 | $ 4,150 |
Gain on related party debt conversion | 224,166 | 0 |
Convertible promissory note agreement [Member] | ||
Fair market value gain | 60,650 | 4,150 |
Fair value of embeded derivative liability | 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 | |
Convertible promissory note agreement [Member] | 2019 [Member] | ||
Amount borrowed under debt instrument from unrelated party | $ 70,000 | |
Interest rate | 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 | |
Convertible promissory note agreement [Member] | October 26, 2019 [Member] | ||
Fair value of embeded derivative liability | $ 8,700 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | Dec. 07, 2020 | Jun. 05, 2020 | Feb. 25, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | May 04, 2020 | Jan. 03, 2020 |
Additional paid-in capital | $ 52,693,974 | $ 15,971,392 | |||||
Debt Conversion, Converted Instrument, Amount | $ 595,500 | ||||||
Debt instrument, convertible, conversion price | $ 0.0143 | ||||||
Common stock shares issued for cash, value | 39,000 | ||||||
Number of warrants outstanding | 120,000 | ||||||
Gain on related party debt conversion | $ 224,166 | $ 0 | |||||
Non-Related Parties [Member] | |||||||
Common stock, shares, new issue | 1,065,982 | 1,065,982 | |||||
Common stock shares issued for cash, value | $ 39,000 | $ 39,000 | |||||
Non-Related Party Two [Member] | |||||||
Debt Conversion, Converted Instrument, Amount | $ 1,551,514 | ||||||
Debt instrument, convertible, conversion price | $ 0.50 | ||||||
Debt conversion, converted instrument, shares issued | 3,103,028 | ||||||
Non-Related Party One [Member] | |||||||
Debt Conversion, Converted Instrument, Amount | $ 65,391 | ||||||
Debt instrument, convertible, conversion price | $ 3.326 | ||||||
Debt conversion, converted instrument, shares issued | 70,448 | ||||||
Gain on related party debt conversion | $ 41,665 | ||||||
Related Party [Member] | |||||||
Debt Conversion, Converted Instrument, Amount | $ 152,781 | ||||||
Debt instrument, convertible, conversion price | $ 0.1530 | ||||||
Debt conversion, converted instrument, shares issued | 1,038,339 | ||||||
Stock warrants settlement | 1,038,339 | ||||||
Related Party Two [Member] | |||||||
Additional paid-in capital | $ 272,299 | ||||||
Debt Conversion, Converted Instrument, Amount | $ 852,196 | ||||||
Debt conversion, converted instrument, shares issued | 260,150 | ||||||
Related Party One [Member] | |||||||
Debt Conversion, Converted Instrument, Amount | $ 266,000 | ||||||
Debt conversion, converted instrument, shares issued | 159,395 | ||||||
Accrued expenses per share | Accrued expenses from $0.5821 to $3.326 per share. | ||||||
Gain on related party debt conversion | $ 62,000 | ||||||
Related Party Three [Member] | |||||||
Additional paid-in capital | 124,291 | ||||||
Debt Conversion, Converted Instrument, Amount | $ 622,004 | ||||||
Debt conversion, converted instrument, shares issued | 648,739 | ||||||
Gain on related party debt conversion | $ 143,660 | ||||||
Asset Purchase Agreement [Member] | IDTEC [Member] | |||||||
Common stock, shares issued upon assets purchase | 12,000,000 | 12,000,000 | |||||
Fair value of the common shares | $ 27,120,000 | ||||||
Number of warrants outstanding | 320,000 | ||||||
Convertible notes, conversion price | $ 0.50 | ||||||
Convertible promissory note agreement [Member] | |||||||
Debt instrument, convertible, conversion price | $ 0.1530 | ||||||
Common stock shares issued to option exercised | 454,097 | ||||||
Reduction in related party debt | $ 65,728 | ||||||
Number of warrants outstanding | 454,097 | ||||||
Gain on related party debt conversion | $ 273,642 | ||||||
Employment Agreement [Member] | Kevin Moore [Member] | |||||||
Common stock shares issued for services, shares | 72,159 | ||||||
Compensation [Member] | |||||||
Common stock shares issued for services, shares | 1,025 | ||||||
Convertible notes, conversion price | $ 20.29 | ||||||
Minimum [Member] | |||||||
Debt instrument, convertible, conversion price | 0.1430 | ||||||
Maximum [Member] | |||||||
Debt instrument, convertible, conversion price | $ 0.1497 | ||||||
Series A Convertible Preferred Stock [Member] | |||||||
Additional paid-in capital | $ 1,329,561 | ||||||
Common stock shares issuable for preferred stock | 417,491 | ||||||
Convertible preferred stock converted | 1,388,575 | ||||||
Conversion price | $ 3.326 | ||||||
Series A-1 Convertible Preferred stock [Member] | |||||||
Debt Conversion, Converted Instrument, Amount | $ 107,880 | ||||||
Convertible preferred stock converted | 2,700,000 | ||||||
Common stock subscriptions payable | 43,169 | ||||||
Common stock shares issued for services, shares | 43,169 | ||||||
Debt conversion, converted instrument, shares issued | 2,700,000 |
PREFERRED STOCK (Details Narrat
PREFERRED STOCK (Details Narratve) - USD ($) | Dec. 07, 2020 | Aug. 23, 2019 | Aug. 08, 2019 | Dec. 31, 2020 | May 07, 2020 | Jan. 03, 2020 | Dec. 31, 2019 | Dec. 12, 2019 | Dec. 09, 2019 | Mar. 08, 2017 | Nov. 20, 2015 |
Accrued dividends payable | $ 107,880 | ||||||||||
Preferred stock, shares authorized | 19,300,000 | 19,300,000 | 25,000,000 | ||||||||
Additional paid-in capital | $ 52,693,974 | $ 15,971,392 | |||||||||
Exercise price | $ 112,871 | ||||||||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | |||||||||
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 | ||||||||||
Series A-1 Convertible Preferred stock [Member] | |||||||||||
Preferred stock, shares authorized | 2,700,000 | 2,700,000 | |||||||||
Convertible preferred stock converted | 2,700,000 | ||||||||||
Converted shares of common stock | 2,700,000 | ||||||||||
Purchase price from SPV, shares | 1,000,000 | ||||||||||
Preferred stock shares sold | 2,700,000 | 1,000,000 | |||||||||
Purchase price from SPV, amount | $ 1,000,000 | ||||||||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | |||||||||
Series A Convertible Preferred Stock [Member] | |||||||||||
Preferred stock, shares authorized | 3,000,000 | 3,000,000 | 3,000,000 | ||||||||
Convertible preferred stock converted | 1,388,575 | ||||||||||
Common stock shares issuable for preferred stock | 417,491 | ||||||||||
Conversion price | $ 3.326 | ||||||||||
Additional paid-in capital | $ 1,329,561 | ||||||||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | $ 0.000001 | ||||||||
Preferred stock conversion description | 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. | ||||||||||
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. | ||||||||||
Investment Agreement [Member] | Convertible Preferred Stock [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. | ||||||||||
SOBR SAFE, LLC [Member] | Asset Purchase Agreement [Member] | |||||||||||
Convertible preferred stock issuable | 2,700,000 | ||||||||||
SOBR SAFE, LLC [Member] | Series A-1 Preferred Stock Purchase Agreement [Member] | Series A-1 Convertible Preferred stock [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 | ||||||||||
Vernon Justus [Member] | Share Exchange Agreement [Member] | |||||||||||
Convertible preferred stock converted | 867,932 | ||||||||||
Common stock shares issuable for preferred stock | 260,954 | ||||||||||
Fair value of the common shares | $ 36,887 | ||||||||||
Conversion price | $ 3.326 | $ 0.133 | |||||||||
Additional paid-in capital | $ 831,045 | $ 831,045 | |||||||||
Michael Lanphere [Member] | Share Exchange Agreement [Member] | |||||||||||
Convertible preferred stock converted | 520,643 | ||||||||||
Common stock shares issuable for preferred stock | 156,537 | ||||||||||
Fair value of the common shares | $ 22,157 | ||||||||||
Conversion price | $ 3.326 | $ 0.133 | |||||||||
Additional paid-in capital | $ 498,516 |
STOCK SUBSCRIPTIONS PAYABLE (De
STOCK SUBSCRIPTIONS PAYABLE (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Preferred stock subscription payable, amount | $ 0 | $ 1,000,000 |
Related Parties [Member] | ||
Gain (Loss) on stock subscription payable | $ 39,992 | $ 39,992 |
Common stock subscription payable, shares | 147,587 | 60,087 |
Stock subscription payable to related party upon common stock shares | 60,087 | |
Stock subscription payable to related party upon common stock shares, amount | $ 111,024 | |
Common stock subscription payable, amount | $ 253,687 | $ 79,624 |
Related Parties [Member] | 8% Series A-1 Convertible Preferred shares [Member] | ||
Preferred stock subscription payable, shares | 1,000,000 | |
Preferred stock subscription payable, amount | $ 1,000,000 |
STOCK WARRANTS AND STOCK OPTI_3
STOCK WARRANTS AND STOCK OPTIONS (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | |
Volatility | 180.00% | ||
Risk free interest rate | 0.13% | ||
Warrants [Member] | |||
Dividend yield | 0.00% | ||
Life of warrants | 5 years | ||
Warrants [Member] | Minimum [Member] | |||
Life of warrants | 14 days | ||
Exercise Price | $ .50 | $ 0.1330 | |
Volatility | 153.00% | 134.00% | |
Risk free interest rate | 0.19% | 1.69% | |
Warrants [Member] | Maximum [Member] | |||
Life of warrants | 5 years | ||
Exercise Price | $ 2 | $ 1.0394 | |
Volatility | 154.00% | 167.00% | |
Risk free interest rate | 0.29% | 2.40% |
STOCK WARRANTS AND STOCK OPTI_4
STOCK WARRANTS AND STOCK OPTIONS (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Exercise Price Per wrrant expired | $ 0.6319 | |
Warrants [Member] | ||
Outstanding at beginning of period | 598,414 | 721,678 |
Warrants Granted | 440,000 | 916,579 |
Warrants Exercised | (454,097) | (1,038,339) |
Warrants Expired | (1,503) | |
Outstanding at ending of periods | 584,317 | 598,414 |
Warrants [Member] | Minimum [Member] | ||
Outstanding at beginning of period | $ 0.13304 | $ 0.1397 |
Warrants Granted | 0.50 | 0.06 |
Warrants Exercised | 0.13304 | 0.1430 |
Outstanding at end of period | 0.50 | 0.13304 |
Warrants [Member] | Maximum [Member] | ||
Outstanding at beginning of period | 1.039375 | 0.6319 |
Warrants Granted | 2 | 0.2062 |
Warrants Exercised | 0.15299 | 0.1497 |
Outstanding at end of period | $ 2 | $ 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 4 months 28 days | 3 years 11 months 19 days |
Weighted Average Remaining Contractual Life, Ending balance | 3 years 9 months 18 days | 3 years 11 months 19 days |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Share, Beginning balance | $ 0.3592 | $ 0.1929 |
Weighted Average Exercise Price Per Share, Warrants granted | 0.9091 | 0.2860 |
Weighted Average Exercise Price Per Share, Warrants exercised | 0.1451 | 0.1463 |
Weighted Average Exercise Price Per Share, ending balance | $ 0.9413 | 0.3592 |
Weighted Average Exercise Price Per Share, Warrants expired | $ 0.6319 | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Beginning balance | $ 1,276,870 | $ 0 |
Aggregate Intrinsic Value, Warrants granted | 898,000 | 2,022,912 |
Aggregate Intrinsic Value, Ending balance | $ 1,173,737 | $ 1,276,870 |
STOCK WARRANTS AND STOCK OPTI_5
STOCK WARRANTS AND STOCK OPTIONS (Details 2) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Expected Volatility | 180.00% | |
Risk free interest rate | 0.13% | |
Stock Options [Member] | ||
Expected Life | 2 years 8 months 9 days | |
Dividend yield | 0.00% | 0.00% |
Stock Options [Member] | Maximum [Member] | ||
Exercise Price | $ 3.30 | $ 1.039 |
Expected Volatility | 171.00% | 146.00% |
Risk free interest rate | 0.43% | 1.70% |
Expected Life | 7 years 2 months 1 day | |
Stock Options [Member] | Minimum [Member] | ||
Exercise Price | $ 1.643 | $ 0.026 |
Expected Volatility | 163.00% | 133.00% |
Risk free interest rate | 0.19% | 1.61% |
Expected Life | 2 years |
STOCK WARRANTS AND STOCK OPTI_6
STOCK WARRANTS AND STOCK OPTIONS (Details 3) - Stock Options [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Options Outstanding Number of Shares | ||
Outstanding at beginning of period | 2,381,239 | 53,368 |
Option Granted | 236,894 | 2,381,239 |
Options Exercised | (45,906) | |
Options Cancelled | (45,100) | |
Options Expired | (8,268) | |
Outstanding at ending of periods | 2,572,227 | 2,381,239 |
Option outstanding, exercisable, beginning balance | 539,847 | |
Option outstanding, exercisable, ending balance | 1,252,744 | 539,847 |
Exercise Price Per Share | ||
Exercise Price Per Shares option exercised | $ 1.039 | |
Exercise Price Per Share Options Cancelled | $ 0.1497 | |
Weighted Average Remaining Contractual Life | ||
Weighted Average Remaining Contractual Lifes beginning balance | 9 years | 2 years 3 months 26 days |
Weighted Average Remaining Contractual Lifes options granted | 1 year 10 months 2 days | 9 years |
Weighted Average Remaining Contractual Lifes options expired | 9 years | |
Weighted Average Remaining Contractual Lifes ending balance | 7 years 5 months 12 days | 9 years |
Weighted Average Remaining Contractual Lifes, Exercisable, Beginning balance | 9 years | |
Weighted Average Remaining Contractual Lifes, Exercisable, Ending balance | 7 years 4 months 24 days | |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Shares beginning balance | $ 0.2761 | $ 0.2761 |
Weighted Average Exercise Price Per Shares options granted | 2.6661 | 0.2960 |
Weighted Average Exercise Price Per Shares options cancelled | 0.1497 | |
Weighted Average Exercise Price Per Shares options expired | 0.9678 | |
Weighted Average Exercise Price Per Shares ending balance | 0.4999 | $ 0.2761 |
Weighted Average Exercise Price Per Shares exercisable beginning balance | 0.4523 | |
Weighted Average Exercise Price Per Shares exercisable ending balance | $ 0.3165 | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value beginning balance | $ 0 | $ 0 |
Aggregate Intrinsic Value options granted | 67,265 | 5,238,080 |
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 | 6,302,292 | $ 5,238,080 |
Aggregate Intrinsic Value exercisable, beginning balance | 807,801 | |
Aggregate Intrinsic Value exercisable ending balance | $ 3,298,370 | |
Minimum [Member] | ||
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | $ 0.2634 | $ 0.1497 |
Exercise Price Per Shares option granted | 1.645 | 0.26341 |
Exercise Price Per Shares option expired | 0 | 0.2328 |
Outstanding at end of period | 0.26342 | 0.2634 |
Exercise Price Per Shares exercisable beginning balance | 0.2634 | |
Exercise Price Per Shares exercisable ending balance | 0.26342 | 0.2634 |
Maximum [Member] | ||
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | 1.039 | 8.31 |
Exercise Price Per Shares option granted | 3.300 | 1.0393 |
Exercise Price Per Shares option expired | 8.31 | |
Outstanding at end of period | 3.300 | 1.039 |
Exercise Price Per Shares exercisable beginning balance | 1.03938 | |
Exercise Price Per Shares exercisable ending balance | $ 3.300 | $ 1.03938 |
STOCK WARRANTS AND STOCK OPTI_7
STOCK WARRANTS AND STOCK OPTIONS (Details Narrative) - USD ($) | Jun. 05, 2020 | Jun. 05, 2020 | May 04, 2020 | Aug. 08, 2019 | Oct. 25, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2012 | Apr. 07, 2020 | Oct. 24, 2019 |
Number of warrants outstanding | 120,000 | |||||||||
Exercise price of warrants | $ 2 | |||||||||
Fair value of warrants issued | $ 220,000 | |||||||||
Share-based compensation expense | $ 273,443 | $ 44,082 | ||||||||
Unrecognized compensation expense | $ 656,000 | |||||||||
Exercise price per share | $ 0.50 | |||||||||
Options vested | 320,000 | |||||||||
Non Employee Stock Warrants [Member] | ||||||||||
Number of warrants outstanding | 584,317 | 598,414 | ||||||||
Stock option granted | 440,000 | 916,579 | ||||||||
Fair value of detached free-standing stock warrants granted | $ 915,124 | $ 160,544 | ||||||||
Executive Stock Options [Member] | ||||||||||
Number of warrants outstanding | 2,521,922 | 2,285,028 | ||||||||
Options exercisable per share | $ 0.2641 | $ 0.26341 | ||||||||
Weighted average remaining contractual life | 7 years 5 months 30 days | 9 years | ||||||||
Michael A. Lanphere [Member] | ||||||||||
Number of warrants outstanding | 454,097 | 454,097 | ||||||||
Reduction in related party debt | $ 65,875 | |||||||||
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. | |||||||||
2019 Equity Incentive Plans [Member] | ||||||||||
Stock option granted | 1,894 | 2,521,922 | 2,285,028 | |||||||
Common stock acquire | $ 236,000 | |||||||||
Stock option descriptions | its common stock at exercise prices ranging from $1.645 to $3.30 to certain employees and key consultants. The fair value of the options granted was approximately $186,000. The stock options vest monthly and quarterly over 1 to 3-year terms. | |||||||||
Common stock authorized shares | 3,848,467 | |||||||||
Total stock option vested shares | 15,000 | |||||||||
Stock option vested shares | 1,202,168 | 539,847 | ||||||||
Stock option issued | $ 1,326,545 | $ 1,563,439 | ||||||||
Stock option non-vested shares | 1,319,753 | 1,745,181 | ||||||||
Asset Purchase Agreement [Member] | IDTEC [Member] | ||||||||||
Number of warrants outstanding | 320,000 | 320,000 | ||||||||
Exercise price of warrants | $ 0.50 | |||||||||
Expected lives | 5 years | |||||||||
8% Series A-1 Convertible Preferred Stock Investment agreement [Member] | First Capital Ventures "FCV" [Member] | ||||||||||
Number of warrants outstanding | 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 | |||||||||
Consultant [Member] | 2019 Equity Incentive Plans [Member] | ||||||||||
Stock option granted | 48,106 | |||||||||
Options exercisable per share | $ 0.2635 | |||||||||
Common stock acquire | $ 50,000 | |||||||||
Stock options vested | 50,000 | 0 | ||||||||
David Gandini [Member] | ||||||||||
Common stock acquire | $ 721,588 | |||||||||
Stock options vested | 521,146 | 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] | ||||||||||
Common stock acquire | $ 1,058,329 | |||||||||
Exercise price per share | $ 0.2635 | |||||||||
Expected lives | 5 years | |||||||||
Stock option descriptions | Stock options to vest in 36 equal monthly installments of 977,777 shares during the three-year term of the Moore Agreement. | |||||||||
Options vested | 352,776 | 58,796 | ||||||||
Kevin Moore [Member] | Employment Agreement [Member] | ||||||||||
Common stock acquire | $ 1,058,328 | |||||||||
Stock options vested | 411,572 | 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] | ||||||||||
Common stock acquire | $ 24,053 | |||||||||
Exercise price per share | $ 0.2635 | |||||||||
Expected lives | 5 years | |||||||||
Reduction in related party debt | $ 127,480 | |||||||||
Options vested | 0 | 0 | ||||||||
Charles Bennington [Member] | ||||||||||
Common stock acquire | $ 24,053 | |||||||||
Exercise price per share | $ 0.2635 | |||||||||
Expected lives | 5 years | |||||||||
Reduction in related party debt | $ 9,656 | |||||||||
Options vested | 0 | 0 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Net loss | $ (29,982,292) | $ (1,252,157) |
Federal Income Tax [Member] | ||
Net loss | (29,982,222) | (1,249,032) |
Permanent differences | 1,830,697 | 313,778 |
Valuation allowance | 28,151,525 | 935,254 |
Net provision for income tax | $ 0 | $ 0 |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax asset attributable to: | ||
Net operating loss carry forward | $ 13,346,000 | $ 9,634,000 |
Net deferred tax asset | 2,830,000 | 1,832,000 |
State [Member] | ||
Deferred tax asset attributable to: | ||
Net operating loss carry forward | 667,000 | 482,000 |
Valuation allowance | (667,000) | (482,000) |
Net deferred tax asset | 0 | 0 |
Federal [Member] | ||
Deferred tax asset attributable to: | ||
Net operating loss carry forward | 13,304,000 | 1,832,000 |
Valuation allowance | (2,163,000) | (1,832,000) |
Net deferred tax asset | $ 0 | $ 0 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Carryforward expiration year | 2040 | |
Deferred tax asset | $ 2,830,000 | $ 1,832,000 |
Rate of net operating losses offset by valuation allowance | 100.00% | |
Change in the valuation allowance | $ 998,000 | $ 187,000 |
Federal tax rate | 21.00% | 21.00% |
Net operating loss carry forward | $ 13,346,000 | $ 9,634,000 |
State tax rate | 5.00% | 5.00% |
Federal [Member] | ||
Net operating loss carry forward | $ 13,304,000 | $ 1,832,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | Oct. 15, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 06, 2006 |
Accrued interest for unpaid wages | $ 11,164 | |||
Accrued interest | 1,000 | |||
Rent expense | 63,978 | $ 64,679 | ||
Contract settlement amount | $ 11,164 | |||
Due to related party | 28,624 | $ 905,443 | ||
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 | |||
California [Member] | ||||
Accrued interest | 53,000 | |||
Contract settlement amount | 83,000 | |||
Due to related party | $ 28,786 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Jan. 15, 2021 | Jan. 06, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt instrument, convertible, conversion price | $ 0.0143 | |||
Common stock shares issued | 25,922,034 | 6,452,993 | ||
Subsequent Event [Member] | ||||
Convertible notes, conversion price | $ 3 | |||
Warrants purchase upon common stock | 25,000 | |||
Debt instrument, principal amount | $ 50,000 | |||
Debt instrument, convertible, conversion price | $ 3 | |||
Interest rate | 12.00% | |||
Debt conversion descriptions | The Debenture Warrants will be exercisable at any time, and from time to time, beginning six months after issuance and expiring two years after issuance, into Shares at an exercise price of $3.00 per share. The Debenture Warrants contain a repurchase right by the Company. The Shares underlying the Secured Debentures and Debenture Warrants will have registration rights. Units may be purchased in increments of $50,000, with the minimum investment being one Unit for $50,000. The Offering will be made on a continuous basis until 5:00 p.m. on March 31, 2021, which may be extended one-time by our Board of Directors until April 30, 2021 (the “Termination Date”), unless earlier terminated or canceled. There will be no closing of the Offering until a minimum of $500,000 is raised (the “Minimum Offering”). After an initial closing is held, offers to purchase Units will be aggregated for subsequent closings to be held on a monthly basis until the maximum of $2,000,000 has been raised or until the Termination Date, whichever is earlier. | |||
Gross proceeds | $ 600,000 | |||
Subsequent Event [Member] | 8% Series A-1 Convertible Preferred shares [Member] | ||||
Common stock shares issued | 43,169 |