Unregistered Sales of Equity Securities

From September 23, 2019, through October 4, 2019, the Company issued and sold to accredited US investors an aggregate of $264,550 Convertible Promissory Notes (the “Notes”) and warrants to purchase an aggregate of 1,889,644 shares of common stock (the “Warrants”). The Company received proceeds from the closing of the private placement of $240,500, which funds were used, and are being used, for general corporate purposes and working capital.

The Notes are due twelve (12) months from their respective issuance dates (the “Maturity Date”). The Notes do not bear interest and were issued in the face amount equal to 110% of the purchasers’ commitments. The Notes are convertible into shares of the Company’s common stock at a rate of $0.07 per share. If the Notes are not paid in full by the Maturity Date, the balance remaining on the Maturity Date shall be increased by 10% and the Company shall be required to pay interest at a rate of 10% per annum thereon until all sums thereunder are paid in full.

The Warrants are exercisable into shares of the Company’s common stock for a term of one (1) year at an exercise price of $0.07 per share. The Warrants also contain provisions that protect the holders against dilution by adjustment of the conversion price in certain events involving a reduction or increase in the Company’s shares.

The offering was made U.S. “accredited investors,” as the term is defined in Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and were made without general advertising or solicitation. The securities sold in the offering were not registered under the Securities Act, or the securities laws of any state, and were offered and sold in reliance on exemptions from registration including the exemption from registration afforded by Section 4(a)(2) of the Securities Act and Regulation S promulgated under the Securities Act, and corresponding provisions of state securities law, which, respectively, exempt transactions by an issuer not involving any public offering or transactions with non-U.S. Investors.

Conversion of Convertible Notes

From October 1, 2019 up to November 13, 2019, Company issued 3,535,714 shares of common stock upon conversion of previously issued convertible notes in aggregate value of $247,500.

Exercise of Warrants

From October 1, 2019 up to November 13, 2019, Company issued 110,000 shares of common stock upon the exercise of previously issued warrants for aggregate cash proceeds of $5,500.

Amendment to Employment Agreements

Effective November 15, 2019, the Company amended the employment agreement of its President and Chief Executive Officer. Under this amendment the term of the agreement was extended for three months, expiring February 15, 2020, cash compensation was reduced to $0 per month, and the Company agreed to grant an option on the Effective Date to the employee to purchase 300,000 shares of Company restricted stock at an exercise price equal to the market closing price on the date of grant, vesting monthly at 100,000 shares per month, and expiring 10 years from the date of grant. The Company will value this option based upon market conditions on the date of grant at a value derived from the Black-Scholes Option Pricing model, which will be amortized over the three-month vesting period as a non-cash compensation expense.

Effective November 15, 2020, the Company amended the employment agreement of its Chief Financial Officer. Under this amendment the term of the agreement is three months, expiring February 15, 2019. No other terms were modified under this amendment.