Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 14, 2021 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ALR Technologies Inc. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding | 530,716,344 | |
Entity File Number | 000-30414 | |
Entity Shell Company | false | |
Entity Incorporation, State or Country Code | NV | |
Amendment Flag | false | |
Entity Interactive Data Current | Yes | |
Entity Central Index Key | 0001087022 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 257,995 | $ 66,190 |
Prepaid expenses | 46,329 | 62,659 |
Total assets | 304,324 | 128,849 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 1,265,065 | 1,113,720 |
Promissory notes payable due to related parties | 3,031,966 | 3,031,966 |
Promissory notes payable to unrelated parties | 2,243,368 | 2,254,353 |
Interest payable | 3,718,529 | 3,575,326 |
Lines of credit from related parties | 12,202,762 | 11,914,092 |
Total liabilities | 22,461,690 | 21,889,457 |
Stockholders' Deficit | ||
Common stock Authorized: Authorized: 10,000,000,000 (December 31, 2020 - 10,000,000,000) shares of common stock with a par value of $0.001 per share Shares issued and outstanding: 526,316,344 shares of common stock (December 31, 2020 - 511,020,709) | 526,316 | 511,020 |
Obligation to issue shares | 200,000 | |
Additional paid-in capital | 71,905,003 | 71,100,134 |
Accumulated deficit | (94,588,685) | (93,571,762) |
Stockholders' deficit | (22,157,366) | (21,760,608) |
Total liabilities and stockholders' deficit | $ 304,324 | $ 128,849 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock: par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock: Authorized | 500,000,000 | 500,000,000 |
Preferred stock: issued | 0 | 0 |
Preferred stock: outstanding | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock Authorized | 10,000,000,000 | 10,000,000,000 |
Common stock Shares, issued | 526,316,344 | 511,020,709 |
Common stock Shares, outstanding | 526,316,344 | 511,020,709 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating Expenses | ||
Product development | $ 112,042 | $ 95,210 |
Professional fees | 217,228 | 37,304 |
Selling, general and administration | 208,286 | 123,045 |
Operating Loss | 537,556 | 255,559 |
Other Item | ||
Interest expense | 479,367 | 518,991 |
Total Other Items | 479,367 | 518,991 |
Net loss | $ (1,016,923) | $ (774,550) |
Weighted average number of shares of common stock outstanding, basic and diluted | 521,414,066 | 269,300,131 |
Loss per share, basic and diluted | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
OPERATING ACTIVITIES | ||
Net loss | $ (1,016,923) | $ (774,550) |
Stock-based compensation-product development | 36,145 | 79 |
Stock-based compensation-professional fees | 15,225 | |
Interest expense on line of credit | 314,737 | 356,454 |
Non-cash imputed interest expense | 31,963 | 30,319 |
Changes in assets and liabilities: | ||
Decrease in prepaid expenses | 16,330 | |
Increase in accounts payable and accrued liabilities | 151,345 | 35,084 |
Increase in interest payable | 132,218 | 132,218 |
Net cash used in operating activities | (318,960) | (220,396) |
FINANCING ACTIVITIES | ||
Proceeds from line of credit | 192,331 | 218,908 |
Repayment of line of credit interest | (218,398) | |
Proceeds from sales of shares of common stock | 536,832 | |
Net cash provided by financing activities | 510,765 | 218,908 |
Decrease in cash | 191,805 | (1,488) |
Cash, beginning of year | 66,190 | 1,838 |
Cash, end of year | $ 257,995 | $ 350 |
Basis of Presentation, Nature o
Basis of Presentation, Nature of Operations and Going Concern | 3 Months Ended |
Mar. 31, 2021 | |
Basisof Presentation Natureof Operationsand Going Concern [Abstract] | |
Basis of Presentation Nature of Operations and Going Concern | 1. Basis of Presentation, Nature of Operations and Going Concern ALR Technologies Inc. (the “Company”) was incorporated under the laws of the State of Nevada on March 24, 1987. On May 16, 2020, the Company incorporated a wholly owned subsidiary, ALR Technologies Sg Pte. Ltd., under the Companies Act These unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) in U.S. dollars and on a going concern basis, which presumes the realization of assets and the discharge of liabilities and commitments in the normal course of operations for the foreseeable future. Several adverse conditions cast substantial doubt on the validity of this assumption. The Company has incurred significant losses over the three-month periods ended March 31, 2021 and 2020 of $1,016,923 and $774,550, respectively. As of March 31, 2021, the Company is unable to self-finance its operations, has a working capital deficit of $22,157,366 (December 31, 2020 - $21,760,608), accumulated deficit of $94,588,685 (December 31, 2020 - $93,571,762), limited resources, no source of operating cash flow and no assurance that sufficient funding will be available to conduct continued product development activities. If the Company is able to finance its required product development activities, there is no assurance the Company’s current projects will be commercially viable or profitable. The Company has debts comprised of accounts payable and accrued liabilities, interest payable, lines of credit and promissory notes payable totaling $22,461,690 currently due, due on demand or considered delinquent. There is no assurance that the Company will not face additional legal action from creditors regarding delinquent accounts payable, promissory notes payable and interest payable. Any one or a combination of these above conditions could result in the failure of the business and cause the Company to cease operations. The Company’s ability to continue as a going concern is dependent upon the continued financial support of its creditors and its ability to obtain financing to fund working capital and overhead requirements, fund the development of the Company’s product line, and ultimately, the Company’s ability to achieve profitable operations and repay overdue obligations. Management has obtained short-term financing from related parties through line of credit facilities with available borrowing in principal up to $12,300,000. As of March 31, 2021, the total principal balance outstanding was $11,731,456. The resolution of whether the Company is able to continue as a going concern is dependent upon the realization of management’s plans. When additional financing is required, the Company plans to raise needed capital through the exercise of share options and by future common share private placements. There can be no assurance that the Company will be able to raise any additional debt or equity capital from the sources described above or that the lenders in the line of credit arrangements will maintain the availability of borrowing from the line. If management is unsuccessful in obtaining short-term financing or achieving long-term profitable operations, the Company will be required to cease operations. In March 2020, the World Health Organization declared coronavirus, COVID-19, a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies and financial markets globally, potentially leading to an economic downturn. Management does not expect that COVID-19 will have a significant impact on the Company; however, it could have a potential impact on the Company’s ability to raise money, market its products to attract customers or procure equipment and parts for its glucose monitoring system. All of the Company’s debt is either due on demand or is in default, while continuing to accrue interest at its stated rates. The Company will seek to obtain creditors’ consents to delay repayment of the outstanding promissory notes payable and related interest thereto, until it is able to replace this financing with funds generated by operations, recapitalization with replacement debt or from equity financings through private placements. While some of the Company’s creditors have agreed to extend repayment deadlines in the past, there is no assurance that they will continue to do so in the future. In the past, creditors have successfully commenced legal action against the Company to recover debts outstanding. In those instances, the Company was able to obtain financing from related parties to cover the verdict or settlement; however, there is no assurance that the Company would be able to obtain the same financing in the future. If the Company is unsuccessful in obtaining financing to cover any potential verdicts or settlements, the Company will be required to cease operations. The Company’s activities will necessitate significant uses of working capital beyond 2021. Additionally, the Company’s capital requirements will depend on many factors, including the success of the Company’s continued product development and distribution efforts. The Company plans to continue financing its operations with the lines of credit it has available. |
Significant accounting policies
Significant accounting policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies These condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, ALR Technologies Sg Pte. Ltd., which was incorporated on May 16, 2020 in Singapore and is currently inactive. All significant intercompany balances and transactions have been eliminated on consolidation. The unaudited condensed consolidated financial statements as of March 31, 2021 and for the period then ended have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. In the opinion of management, all adjustments necessary to present fairly the financial position as of March 31, 2021 and December 31, 2020, and the results of operations and cash flows as of March 31, 2021 and 2020, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2020. The results of operations for the three-month period ended March 31, 2021 are not necessarily indicative of the results to be expected for the full year. |
Interest, Advances and Promisso
Interest, Advances and Promissory Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Interest Advancesand Promissory Notes Payable [Abstract] | |
Interest, Advances and Promissory Notes Payable | 3. Interest, Advances and Promissory Notes Payable a) Promissory notes payable to related parties A summary of the promissory notes payable to related parties is as follows: Promissory Notes Payable to Related Parties March 31, December 31, 2020 Promissory notes payable to relatives of directors collateralized by a general security agreement over all the assets of the Company, past maturity: i. Interest at 1% per month $ 720,619 $ 720,619 ii. Interest at 1.25% per month 51,347 51,347 iii. Interest at the U.S. bank prime rate plus 1% 100,000 100,000 iv. Interest at 0.5% per month 695,000 695,000 Promissory notes payable, unsecured, to relatives of a director, bearing interest at 1% per month, past maturity 1,465,000 1,465,000 Total Promissory Notes Payable to Related Parties $ 3,031,966 $ 3,031,966 All amounts past maturity continue to accrue interest at their stated rate and are considered due on demand. b) Promissory notes payable to unrelated parties A summary of the promissory notes payable to unrelated parties is as follows: Promissory Notes Payable to Unrelated Parties March 31, December 31, 2020 Unsecured promissory notes payable to unrelated lenders, past maturity: i. Interest at 1% per month $ 1,337,456 $ 1,337,456 i. Interest at 0.667% per month 425,000 435,985 ii. Interest at 0.625% per month 150,000 150,000 iii. Non-interest-bearing 270,912 270,912 Promissory notes payable, secured by a guarantee from the Chief Executive Officer, bearing interest at 1% per month past maturity 60,000 60,000 Total Promissory Notes Payable to Unrelated Parties $ 2,243,368 $ 2,254,353 All amounts past maturity continue to accrue interest at their stated rate and are considered due on demand. c) Interest payable A summary of the interest payable activity is as follows: Balance, December 31, 2019 $ 5,364,997 Interest incurred on promissory notes payable 528,871 Interest payable retired through issuance of shares (2,318,542 ) Balance, December 31, 2020 3,575,326 Reclassified from promissory notes payable 10,985 Interest incurred on promissory notes payable 132,218 Balance, March 31, 2021 $ 3,718,529 Interest payable is due to related and non-related parties as follows: March 31, December 31, 2020 Related parties (relatives of the Chairman) $ 952,647 $ 873,666 Non-related parties 2,765,882 2,701,660 $ 3,718,529 $ 3,575,326 The payment terms, security and any interest payable are based on the underlying promissory notes payable that the Company has outstanding. d) Interest expense During the period ended March 31, 2021, the Company incurred interest expense of $479,367 (2020 - $518,991) as follows: · $314,737 (2020 - $356,454) incurred on lines of credit payable as shown in note 4; · $132,218 (2020 - $132,218) incurred on promissory notes (notes 3(a) and 3(b)); · $31,963 (2020 - $30,319) incurred from the calculation of imputed interest on accounts payable outstanding for longer than one year, advances payable and promissory notes payable, which had no stated interest rate; and · $449 (2020 - $nil) interest on other items. |
Lines of Credit
Lines of Credit | 3 Months Ended |
Mar. 31, 2021 | |
Linesof Credit Related Party [Abstract] | |
Lines of Credit | 4. Lines of Credit As of March 31, 2021, the Company had two lines of credit as follows: Creditor Interest Rate Borrowing Limit Repayment Terms Principal Borrowed Accrued Interest Total Outstanding Security Purpose Chairman and CEO 1% per Month $ 10,300,000 Due on Demand $ 9,731,456 $ 401,291 $ 10,132,747 General Security over Assets General Corporate Requirements Wife of Chairman 1% per Month 2,000,000 Due on Demand 2,000,000 70,015 2,070,015 General Security over Assets General Corporate Requirements Total $ 12,300,000 $ 11,731,456 $ 471,306 $ 12,202,762 As of December 31, 2020, the Company had two lines of credit as follows: Creditor Interest Rate Borrowing Limit Repayment Terms Principal Borrowed Accrued Interest Total Outstanding Security Purpose Chairman and CEO 1% per Month $ 10,300,000 Due on Demand $ 9,539,125 $ 314,967 $ 9,854,092 General Security over Assets General Corporate Requirements Wife of Chairman 1% per Month 2,000,000 Due on Demand 2,000,000 60,000 2,060,000 General Security over Assets General Corporate Requirements Total $ 12,300,000 $ 11,539,125 $ 374,967 $ 11,914,092 On September 21, 2020, the Company, the Chairman and the Chairman’s spouse agreed to retire a portion of the principal of $1,038,967 and accrued interest of $8,642,491 pursuant to two shares for debt agreements (note 5(b)). |
Capital Stock
Capital Stock | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Capital Stock | 5. Capital Stock a) Authorized capital stock i. Common stock 10,000,000,000 shares of common stock with a par value of $0.001 per share. ii. Preferred stock 500,000,000 shares of preferred stock with a par value of $0.001 per share. b) Issued capital stock During the period ended March 31, 2021: i) On January 4, 2021, 1,000 shares of common stock were cancelled by a shareholder; no consideration was exchanged. ii) The Company collected subscriptions of $524,832 pursuant to its registration statement and issued a total of 14,496,635 shares of common stock for gross proceeds of $724,832. $200,000 of the proceeds had been collected during the year ended December 31, 2020 and recognized as Obligation to Issue Shares. The Company has until July 31, 2021 to sell the remaining 113,025,592 shares of common stock (note 9(a)). iii) The Company received proceeds of $12,000 pursuant to the exercise of options to acquire 800,000 shares of common stock at a price of $0.015 per share. During the year ended December 31, 2020: i) On February 11, 2020, the Company issued 2,000,000 restricted shares of common stock at a price of $0.04 per share with a value of $80,000 in exchange for the retirement of $60,000 of accounts payable and $20,000 for the provision of services. ii) On August 24, 2020, the Company issued 242,800 restricted shares of common stock at a price of $0.05 per share for proceeds of $12,140. iii) On September 21, 2020, the Company entered into two shares for debt agreements with the Chairman and his spouse to issue an aggregate 240,000,000 restricted shares of common stock at a price of $0.05 per share for a purchase price of $12,000,000 in exchange for the retirement of $12,000,000 of liabilities comprised of: · Promissory Notes - Accrued interest - $ 2,318,542 · Line of Credit - Accrued interest - $ 8,642,491 · Line of Credit - Principal - $ 1,038,967 iv) On December 4, 2020, the Company filed a Form S-1 Registration Statement to distribute subscription rights to purchase up to an aggregate 127,522,227 shares of common stock at a price of $0.05 per share for maximum aggregate offering proceeds of $6,376,111. The Company collected subscriptions of $200,000 related to management’s right to allocate unsubscribed shares of common stock. |
Additional paid in capital
Additional paid in capital | 3 Months Ended |
Mar. 31, 2021 | |
Additional Paid in Capital [Abstract] | |
Additional paid in capital | 6. Additional Paid-in Capital Stock options A summary of stock option activity is as follows: Three Months Ended March 31, 2021 Year Ended December 31, 2020 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Outstanding, beginning of period 5,362,701,500 $ 0.004 5,236,401,500 $ 0.003 Granted 37,000,000 $ 0.050 139,800,000 $ 0.047 Exercised (800,000) $ (0.015) - $ - Cancelled - $ - (13,500,000) $ (0.034) Outstanding, end of period 5,398,901,500 $ 0.005 5,362,701,500 $ 0.004 Exercisable, end of period 5,201,901,500 $ 0.003 5,202,701,500 $ 0.003 During the period ended March 31, 2021: On January 28, 2021, the Company’s Board of Directors approved the grant of the option to acquire an aggregate 32,000,000 shares of common stock at a price of $0.05 per share to six individuals. All of the options will vest according to performance or time-based conditions. Options to acquire 22,000,000 shares of common stock will expire December 31, 2025, and options to acquire 10,000,000 shares of common stock will expire May 17, 2024. None of these options have vested to date. The fair value of the options granted totals $1,706,244, of which $573,292 relates to stock options that have time-based vesting conditions and $1,132,952 relates to stock options that have performance vesting conditions. During the current period, $45,597 relates to the stock options with time-based vesting conditions, which was recorded. The remaining fair value of $1,660,647 has not been recorded. On February 22, 2021, the Company’s Board of Directors approved the grant of the option to acquire an aggregate 5,000,000 shares of common stock at a price of $0.05 per share. These options were granted to three individuals and have an expiry date of May 17, 2024. None of these options have vested to date. The fair value of the options granted totals $225,141. During the current period, $5,773 relates to stock options with time-based vesting conditions, which was recorded. The remaining fair value of $219,368 has not been recorded. During the year ended December 31, 2020: On April 1, 2020, the Company granted one consultant the option to acquire 10,000,000 shares of common stock at a price of $0.035 per share for a term of five years. The fair value of the options granted totaling $391,843 was fully recorded at grant. On May 12, 2020, the Company amended the option to acquire 40,000,000 shares of common stock granted on June 12, 2019 to extend the period of vesting from May 31, 2020 to December 31, 2020. None of these options have vested to date. On May 18, 2020, the Company granted one consultant the option to acquire 500,000 shares of common stock of the Company at a price of $0.035 per share until May 17, 2024. The fair value of the options granted totaling $18,725 was fully recorded at grant. On June 1, 2020, the Company granted one consultant the option to acquire 10,000,000 shares of common stock of the Company at a price of $0.035 per share until May 31, 2025 subject to performance vesting conditions. The fair value of the options granted totaling $621,853 was not recorded, as it cannot be determined that it is more likely than not that the performance condition will be met. On June 5, 2020, the Company granted one sales agent the option to acquire 10,000,000 shares of common stock of the Company at a price of $0.035 per share until May 31, 2025 subject to the agent enrolling 20,000 patients into the ALRT Diabetes Solution by May 31, 2021. The fair value of the options granted totaling $494,868 was not recorded, as it cannot be determined that it is more likely than not that the performance condition will be met. On September 1, 2020, the Company granted thirteen individuals the option to acquire an aggregate 74,500,000 options at an exercise price of $0.05 per share; 22,000,000 stock options, which vested at the time of grant, will expire on May 17, 2024 and 52,500,000 stock options, which vest upon achievement of performance conditions, will expire on May 31, 2025. None of the stock options with performance vesting conditions have vested. The fair value of the options granted totals $3,854,619, of which $1,137,397 related to the stock options that have vested was recorded and $2,717,222 related to the options that have not vested was not recorded. On October 12, 2020, the Company granted eight individuals the option to acquire an aggregate 34,800,000 options at an exercise price of $0.05 per share until May 31, 2025; 18,300,000 vested at the time of grant and 16,500,000 of the stock options granted will vest upon achievement of performance conditions. None of the stock options with performance vesting conditions have vested. The fair value of the options granted totals $2,434,053, of which $1,279,973 related to the stock options that have vested was recorded and $1,154,080 related to the options that have not vested was not recorded. During the year ended December 31, 2020, the Company recorded a further $79 in compensation expense related to the vesting of stock options granted in previous years. Outstanding The options outstanding at March 31, 2021 and December 31, 2020 were as follows: March 31, 2021 December 31, 2020 Expiry Date Options Exercise Price Intrinsic Value Options Exercise Price Intrinsic Value July 1, 2021 4,365,001,300 $ 0.002 $ 0.048 4,365,001,300 $ 0.002 $ 0.069 November 27, 2022 6,150,000 $ 0.015 $ 0.035 6,950,000 $ 0.015 $ 0.056 January 31, 2023 40,500,000 $ 0.015 $ 0.035 40,500,000 $ 0.015 $ 0.056 June 13, 2023 5,000,000 $ 0.015 $ 0.035 5,000,000 $ 0.015 $ 0.056 October 1, 2023 300,000 $ 0.050 $ - 300,000 $ 0.050 $ 0.021 February 3, 2024 10,000,000 $ 0.035 $ 0.015 10,000,000 $ 0.035 $ 0.036 March 14, 2024 9,150,000 $ 0.035 $ 0.015 9,150,000 $ 0.035 $ 0.036 April 12, 2024 560,000,200 $ 0.002 $ 0.048 560,000,200 $ 0.002 $ 0.069 April 12, 2024 3,900,000 $ 0.015 $ 0.035 3,900,000 $ 0.015 $ 0.056 April 12, 2024 200,000 $ 0.030 $ 0.020 200,000 $ 0.030 $ 0.041 May 6, 2024 13,000,000 $ 0.035 $ 0.015 13,000,000 $ 0.035 $ 0.036 May 17, 2024 77,000,000 $ 0.050 $ - 62,000,000 $ 0.050 $ 0.021 May 17, 2024 25,400,000 $ 0.035 $ 0.015 25,400,000 $ 0.035 $ 0.036 June 17, 2024 5,000,000 $ 0.050 $ - 5,000,000 $ 0.050 $ 0.021 June 17, 2024 5,000,000 $ 0.035 $ 0.015 5,000,000 $ 0.035 $ 0.036 August 16, 2024 2,500,000 $ 0.050 $ - 2,500,000 $ 0.050 $ 0.021 September 6, 2024 1,000,000 $ 0.050 $ - 1,000,000 $ 0.050 $ 0.021 September 17, 2024 5,000,000 $ 0.035 $ 0.015 5,000,000 $ 0.035 $ 0.036 October 3, 2024 3,500,000 $ 0.035 $ 0.015 3,500,000 $ 0.035 $ 0.036 October 24, 2024 2,000,000 $ 0.035 $ 0.015 2,000,000 $ 0.035 $ 0.036 December 11, 2024 120,000,000 $ 0.015 $ 0.035 120,000,000 $ 0.015 $ 0.056 April 1, 2025 10,000,000 $ 0.035 $ 0.015 10,000,000 $ 0.035 $ 0.036 May 31, 2025 20,000,000 $ 0.035 $ 0.015 20,000,000 $ 0.035 $ 0.036 May 31, 2025 87,300,000 $ 0.050 $ - 87,300,000 $ 0.050 $ 0.021 December 31, 2025 22,000,000 $ 0.050 $ - - $ - $ - Total 5,398,901,500 $ 0.005 $ 0.045 5,362,701,500 $ 0.004 $ 0.066 Weighted Average Remaining Contractual Life 0.82 1.05 The fair value of the stock options granted and vested was allocated as follows: Three Months Ended Three Months Ended Product development expense $ 36,145 $ 79 Professional expense 15,225 — $ 51,370 $ 79 The Company uses the fair value method for determining stock-based compensation for all options granted during the fiscal periods. The fair value was determined using the Black-Scholes option pricing model based on the following weighted average assumptions: March 31, 2021 December 31, 2020 Risk-free interest rate 0.33 % 0.20 % Expected life 4.3 years 4.6 years Expected dividends 0 % 0 % Expected volatility 232 % 312 % Forfeiture rate 0 % 0 % The weighted average fair value for the options granted during the three months ended March 31, 2021 was $0.05 (December 31, 2020 - $0.06 ). |
Related party transactions and
Related party transactions and balances | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related party transactions and balances | 7. Related Party Transactions and Balances Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Related party transactions included within interest expense: Interest expense on promissory notes issued to relatives of the Chairman and Chief Executive Officer of the Company $ 78,982 $ 78,792 Interest expense on lines of credit payable to the Chairman and Chief Executive Officer of the Company and his spouse $ 314,737 $ 356,454 Related party transactions included within selling, general and administrative expenses: Consulting fees to the Chairman and Chief Executive Officer of the Company accrued on the line of credit available to the Company $ 62,400 $ 62,400 Related party transactions included within product development expense: Consulting fees to a relative of the Chairman and Chief Executive Officer of the Company $ - $ 30,000 Interest on promissory notes payable to related parties, management compensation and compensation paid to a relative of a director have been recorded at the exchange amount, which is the amount agreed to by the parties. Options granted to related parties have been recorded at their estimated fair value. |
Commitments and contingencies
Commitments and contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Compensation Related Costs [Abstract] | |
Commitments and contingencies | 8. Commitments and Contingencies a) Contingencies The Company has had three judgments against it relating to overdue promissory notes and accrued interest, and a fourth creditor has demanded repayment of an overdue promissory note and accrued interest. To date, the Company has not repaid any of these promissory notes and related accrued interest and could be subject to further action. The legal liability, totaling $1,224,982, of these promissory notes and related accrued interest have been fully recognized and recorded by the Company. The Company has accrued interest of $261,457 related to one of these promissory notes. On September 23, 2020, the Superior Court of Forsyth County, North Carolina, issued a Civil Summons in regards to one of the above noted judgment of $551,576, consisting of the principal amount of $300,000 and accrued interest of $251,576, as of the date of the Civil Summons. An Order for Mediated Settlement Conference in Superior Court and Trial Calendar Notice was issued and a tentative trial date in the absence of a mediated settlement has been set for June 28, 2021. b) Commitments The Company has a consulting arrangement with Mr. Sidney Chan, Chief Executive Officer and Chairman of the Board of Directors of the Company. Under the terms of the contract, Mr. Chan will be paid $240,000 per annum for services as Chief Executive Officer. The contract can be terminated at any time with thirty days’ notice and the payment of two years’ annual salary. Should the contract be terminated, all debts owed to Mr. Chan and his spouse must be immediately repaid. The initial term of the contract is for one year and automatically renews for continuous one-year terms. Also, under the terms of the contract are the following: i. Incentive revenue bonus Mr. Chan will be entitled to a 1% net sales commission from the sales of any of the Company’s products at any time during his life, regardless if Mr. Chan is still under contract with the Company. ii. Sale of business If more than 50% of the Company’s stock or assets are sold, Mr. Chan will be compensated for entering into non-compete agreements based on the selling price of the Company or its assets as follows: · 2% of sales price up to $24,999,999 plus · 3% of sales price between $25,000,000 and $49,999,999 plus · 4% of sales price between $50,000,000 and $199,999,999 plus · 5% of sales price in excess of $200,000,000. |
Subsequent event
Subsequent event | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 9. Subsequent Events a) On April 12, 2021, the Company elected to extend the initial 90-day period (April 22, 2021) by an additional 100-day period from the closing of the Rights Offering. The Company has until July 31, 2021 to sell the remaining 113,025,592 shares of common stock. b) On April 14, 2021, the Company’s Board of Directors approved the grant of the option to acquire an aggregate 28,500,000 shares of common stock at a price of $0.05 per share until December 31, 2025. The options to acquire shares will vest according to performance or time-based conditions, and none of these options granted had vested as of the date of these financial statements. c) The Company entered into two Debt Settlement Agreements whereby the Company has agreed to issue an aggregate of 4,400,000 shares of common stock to two creditors of the Company to extinguish $194,186 in accounts payable and $23,000 in promissory notes and interest. The shares were issued on May 10, 2021. The Company also issued commitment letters to two creditors offering them an aggregate of 20,000,000 shares of common stock in exchange for the extinguishment of $1,511,377 in promissory notes and interest payable prior to December 31, 2021. d) On May 12, 2021, the Company’s Board of Directors approved the grant of the option to acquire an aggregate 1,000,000 shares of common stock at a price of $0.05 per share until December 31, 2025. The options to acquire shares will vest according to performance conditions, and none of these options granted had vested as of the date of these financial statements. |
Interest, Advances and Promis_2
Interest, Advances and Promissory Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Interest Advancesand Promissory Notes Payable [Abstract] | |
Schedule of Promissory Notes Payable - Relatives of Board of Directors | A summary of the promissory notes payable to related parties is as follows: Promissory Notes Payable to Related Parties March 31, December 31, 2020 Promissory notes payable to relatives of directors collateralized by a general security agreement over all the assets of the Company, past maturity: i. Interest at 1% per month $ 720,619 $ 720,619 ii. Interest at 1.25% per month 51,347 51,347 iii. Interest at the U.S. bank prime rate plus 1% 100,000 100,000 iv. Interest at 0.5% per month 695,000 695,000 Promissory notes payable, unsecured, to relatives of a director, bearing interest at 1% per month, past maturity 1,465,000 1,465,000 Total Promissory Notes Payable to Related Parties $ 3,031,966 $ 3,031,966 |
Schedule of Activity of Promissory Notes Payable to Unrelated Lenders | A summary of the promissory notes payable to unrelated parties is as follows: Promissory Notes Payable to Unrelated Parties March 31, December 31, 2020 Unsecured promissory notes payable to unrelated lenders, past maturity: i. Interest at 1% per month $ 1,337,456 $ 1,337,456 i. Interest at 0.667% per month 425,000 435,985 ii. Interest at 0.625% per month 150,000 150,000 iii. Non-interest-bearing 270,912 270,912 Promissory notes payable, secured by a guarantee from the Chief Executive Officer, bearing interest at 1% per month past maturity 60,000 60,000 Total Promissory Notes Payable to Unrelated Parties $ 2,243,368 $ 2,254,353 |
Schedule of Interest Payable | c) Interest payable A summary of the interest payable activity is as follows: Balance, December 31, 2019 $ 5,364,997 Interest incurred on promissory notes payable 528,871 Interest payable retired through issuance of shares (2,318,542 ) Balance, December 31, 2020 3,575,326 Reclassified from promissory notes payable 10,985 Interest incurred on promissory notes payable 132,218 Balance, March 31, 2021 $ 3,718,529 Interest payable is due to related and non-related parties as follows: March 31, December 31, 2020 Related parties (relatives of the Chairman) $ 952,647 $ 873,666 Non-related parties 2,765,882 2,701,660 $ 3,718,529 $ 3,575,326 |
Lines of Credit (Tables)
Lines of Credit (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Linesof Credit Related Party [Abstract] | |
Schedule Line of Credit Related Party | As of March 31, 2021, the Company had two lines of credit as follows: Creditor Interest Rate Borrowing Limit Repayment Terms Principal Borrowed Accrued Interest Total Outstanding Security Purpose Chairman and CEO 1% per Month $ 10,300,000 Due on Demand $ 9,731,456 $ 401,291 $ 10,132,747 General Security over Assets General Corporate Requirements Wife of Chairman 1% per Month 2,000,000 Due on Demand 2,000,000 70,015 2,070,015 General Security over Assets General Corporate Requirements Total $ 12,300,000 $ 11,731,456 $ 471,306 $ 12,202,762 As of December 31, 2020, the Company had two lines of credit as follows: Creditor Interest Rate Borrowing Limit Repayment Terms Principal Borrowed Accrued Interest Total Outstanding Security Purpose Chairman and CEO 1% per Month $ 10,300,000 Due on Demand $ 9,539,125 $ 314,967 $ 9,854,092 General Security over Assets General Corporate Requirements Wife of Chairman 1% per Month 2,000,000 Due on Demand 2,000,000 60,000 2,060,000 General Security over Assets General Corporate Requirements Total $ 12,300,000 $ 11,539,125 $ 374,967 $ 11,914,092 |
Additional paid in capital (Tab
Additional paid in capital (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of stock option activity is as follows: Three Months Ended March 31, 2021 Year Ended December 31, 2020 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Outstanding, beginning of period 5,362,701,500 $ 0.004 5,236,401,500 $ 0.003 Granted 37,000,000 $ 0.050 139,800,000 $ 0.047 Exercised (800,000) $ (0.015) - $ - Cancelled - $ - (13,500,000) $ (0.034) Outstanding, end of period 5,398,901,500 $ 0.005 5,362,701,500 $ 0.004 Exercisable, end of period 5,201,901,500 $ 0.003 5,202,701,500 $ 0.003 |
Schedule of Options Outstanding | The options outstanding at March 31, 2021 and December 31, 2020 were as follows: March 31, 2021 December 31, 2020 Expiry Date Options Exercise Price Intrinsic Value Options Exercise Price Intrinsic Value July 1, 2021 4,365,001,300 $ 0.002 $ 0.048 4,365,001,300 $ 0.002 $ 0.069 November 27, 2022 6,150,000 $ 0.015 $ 0.035 6,950,000 $ 0.015 $ 0.056 January 31, 2023 40,500,000 $ 0.015 $ 0.035 40,500,000 $ 0.015 $ 0.056 June 13, 2023 5,000,000 $ 0.015 $ 0.035 5,000,000 $ 0.015 $ 0.056 October 1, 2023 300,000 $ 0.050 $ - 300,000 $ 0.050 $ 0.021 February 3, 2024 10,000,000 $ 0.035 $ 0.015 10,000,000 $ 0.035 $ 0.036 March 14, 2024 9,150,000 $ 0.035 $ 0.015 9,150,000 $ 0.035 $ 0.036 April 12, 2024 560,000,200 $ 0.002 $ 0.048 560,000,200 $ 0.002 $ 0.069 April 12, 2024 3,900,000 $ 0.015 $ 0.035 3,900,000 $ 0.015 $ 0.056 April 12, 2024 200,000 $ 0.030 $ 0.020 200,000 $ 0.030 $ 0.041 May 6, 2024 13,000,000 $ 0.035 $ 0.015 13,000,000 $ 0.035 $ 0.036 May 17, 2024 77,000,000 $ 0.050 $ - 62,000,000 $ 0.050 $ 0.021 May 17, 2024 25,400,000 $ 0.035 $ 0.015 25,400,000 $ 0.035 $ 0.036 June 17, 2024 5,000,000 $ 0.050 $ - 5,000,000 $ 0.050 $ 0.021 June 17, 2024 5,000,000 $ 0.035 $ 0.015 5,000,000 $ 0.035 $ 0.036 August 16, 2024 2,500,000 $ 0.050 $ - 2,500,000 $ 0.050 $ 0.021 September 6, 2024 1,000,000 $ 0.050 $ - 1,000,000 $ 0.050 $ 0.021 September 17, 2024 5,000,000 $ 0.035 $ 0.015 5,000,000 $ 0.035 $ 0.036 October 3, 2024 3,500,000 $ 0.035 $ 0.015 3,500,000 $ 0.035 $ 0.036 October 24, 2024 2,000,000 $ 0.035 $ 0.015 2,000,000 $ 0.035 $ 0.036 December 11, 2024 120,000,000 $ 0.015 $ 0.035 120,000,000 $ 0.015 $ 0.056 April 1, 2025 10,000,000 $ 0.035 $ 0.015 10,000,000 $ 0.035 $ 0.036 May 31, 2025 20,000,000 $ 0.035 $ 0.015 20,000,000 $ 0.035 $ 0.036 May 31, 2025 87,300,000 $ 0.050 $ - 87,300,000 $ 0.050 $ 0.021 December 31, 2025 22,000,000 $ 0.050 $ - - $ - $ - Total 5,398,901,500 $ 0.005 $ 0.045 5,362,701,500 $ 0.004 $ 0.066 Weighted Average Remaining Contractual Life 0.82 1.05 |
Schedule of Fair Value of Stock Options Granted-Allocation | The fair value of the stock options granted and vested was allocated as follows: Three Months Ended Three Months Ended Product development expense $ 36,145 $ 79 Professional expense 15,225 — $ 51,370 $ 79 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company uses the fair value method for determining stock-based compensation for all options granted during the fiscal periods. The fair value was determined using the Black-Scholes option pricing model based on the following weighted average assumptions: March 31, 2021 December 31, 2020 Risk-free interest rate 0.33 % 0.20 % Expected life 4.3 years 4.6 years Expected dividends 0 % 0 % Expected volatility 232 % 312 % Forfeiture rate 0 % 0 % |
Related party transactions an_2
Related party transactions and balances (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions And Balances | |
Schedule of related party transactions | Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Related party transactions included within interest expense: Interest expense on promissory notes issued to relatives of the Chairman and Chief Executive Officer of the Company $ 78,982 $ 78,792 Interest expense on lines of credit payable to the Chairman and Chief Executive Officer of the Company and his spouse $ 314,737 $ 356,454 Related party transactions included within selling, general and administrative expenses: Consulting fees to the Chairman and Chief Executive Officer of the Company accrued on the line of credit available to the Company $ 62,400 $ 62,400 Related party transactions included within product development expense: Consulting fees to a relative of the Chairman and Chief Executive Officer of the Company $ - $ 30,000 |
Basis of Presentation, Nature_2
Basis of Presentation, Nature of Operations and Going Concern (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Basisof Presentation Natureof Operationsand Going Concern [Abstract] | |||
Working Capital Deficit | $ 22,157,366 | $ 21,760,608 | |
Net Income (Loss) Attributable to Parent | $ (1,016,923) | $ (774,550) |
Interest, advances and promis_3
Interest, advances and promissory notes payable (Details) - Promissory Notes Payable - Relatives of Board of Directors - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Promissory notes payable to relatives of directors collateralized by a general security agreement over all the assets of the Company, due on demand: | ||
i.Interest at 1% per month | $ 720,619 | $ 720,619 |
ii.Interest at 1.25% per month | 51,347 | 51,347 |
iii.Interest at the U.S. bank prime rate plus 1% | 100,000 | 100,000 |
iv. Interest at 0.5% per month | 695,000 | 695,000 |
Promissory notes payable, unsecured, to relatives of a director, bearing interest at 1% per month, due on demand | 1,465,000 | 1,465,000 |
Total Related Promissory Notes | $ 3,031,966 | $ 3,031,966 |
Interest, advances and promis_4
Interest, advances and promissory notes payable (Details) - Unsecured Promissory Notes Payable to Unrelated Leaders - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Unsecured promissory notes payable to unrelated lenders: | ||
i. Interest at 1% per month | $ 1,337,456 | $ 1,337,456 |
i. Interest at 0.625% per month | 435,985 | 425,000 |
ii. Interest at 0.667% per month | 150,000 | 150,000 |
iii. Non-interest-bearing | 270,912 | 270,912 |
Promissory notes payable, secured by a guarantee from the Chief Executive Officer, bearing interest at 1% per month | 60,000 | 60,000 |
Total Promissory Notes Payable to Unrelated Parties | $ 2,254,353 | $ 2,243,368 |
Interest, advances and promis_5
Interest, advances and promissory notes payable (Details) - Summary of Interest Payable Activity - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Summary of Interest Payable Activity [Abstract] | ||
Beginning Balance | $ 3,575,326 | $ 5,364,997 |
Reclassified from promissory notes payable | 10,985 | |
Interest incurred on promissory notes payable | 132,218 | 528,871 |
Interest payable retired through issuance of shares | (2,318,542) | |
Ending Balance | $ 3,718,529 | $ 3,575,326 |
Interest, advances and promis_6
Interest, advances and promissory notes payable (Details) - Interest Payable - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Interest Payable [Abstract] | ||||
Related parties (relatives of the Chairman) | $ 873,666 | $ 952,647 | ||
Non-related parties | 2,701,660 | 2,765,882 | ||
Total | $ 3,718,529 | $ 3,575,326 | $ 3,718,529 | $ 5,364,997 |
Lines of Credit (Details)
Lines of Credit (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Borrowing Limit | $ 12,300,000 | $ 12,300,000 | |
Principal Borrowed | 11,539,125 | 11,731,456 | |
Accrued Interest | 374,967 | 471,306 | |
Total Outstanding | $ 11,914,092 | $ 12,202,762 | |
Chairman and CEO | |||
Interest Rate | 1.00% | 1.00% | |
Borrowing Limit | $ 10,300,000 | $ 10,300,000 | |
Repayment Terms | Due on Demand | Due on Demand | |
Principal Borrowed | $ 9,731,456 | $ 9,539,125 | |
Accrued Interest | 401,291 | 314,967 | |
Total Outstanding | $ 10,132,747 | $ 9,854,092 | |
Security | General Security over Assets | General Security over Assets | |
Purpose | General Corporate Requirements | General Corporate Requirements | |
Wife of Chairman | |||
Interest Rate | 1.00% | 1.00% | |
Borrowing Limit | $ 2,000,000 | $ 2,000,000 | |
Repayment Terms | Due on Demand | Due on Demand | |
Principal Borrowed | $ 2,000,000 | $ 2,000,000 | |
Accrued Interest | 70,015 | 60,000 | |
Total Outstanding | $ 2,070,015 | $ 2,060,000 | |
Security | General Security over Assets | General Security over Assets | |
Purpose | General Corporate Requirements | General Corporate Requirements |
Additional paid in capital - Su
Additional paid in capital - Summary of Stock Option Activity (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Summary of Stock Option Activity [Abstract] | ||
Outstanding, beginning of period | 5,362,701,500 | 5,236,401,500 |
Average Exercise Price, beginning | $ 0.004 | $ 0.003 |
Granted | 37,000,000 | 139,800,000 |
Granted, per share | $ 0.050 | $ 0.047 |
Exercised | (800,000) | |
Exercised per share | $ (.015) | |
Cancelled | (13,500,000) | |
Cancelled per share | $ (0.034) | |
Outstanding, end of period | 5,398,901,500 | 5,362,701,500 |
Average Exercise price, ending | $ 0.005 | $ 0.004 |
Exercisable, end of period | 5,201,901,500 | 5,202,701,500 |
Exercisable, end of period | $ .005 | $ .003 |
Additional paid in capital - Op
Additional paid in capital - Options Outstanding (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Options Outstanding [Abstract] | |||
Options Outstanding | 5,398,901,500 | 5,362,701,500 | 5,236,401,500 |
Exercise Price | $ .005 | $ .003 | |
Weighted Average Remaining Contractual Life | 9 months 25 days | 1 year 18 days |
Additional paid in capital - Fa
Additional paid in capital - Fair Value of Stock Options (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Fair Value of Stock Options [Abstract] | ||
Product development | $ 36,145 | $ 79 |
Professional expense | 15,225 | |
Total | $ 51,370 | $ 79 |
Additional paid in capital - _2
Additional paid in capital - Fair Value Method Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Fair Value Method Stock-Based Compensation [Abstract] | ||
Risk-free interest rate | 0.33% | 0.20% |
Expected life | 4 years 3 months 19 days | 4 years 7 months 6 days |
Expected dividends | $ 0 | $ 0 |
Expected volatility | 232.00% | 312.00% |
Forfeiture rate | $ 0 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Related party transaction included within interest expense: | ||
Interest expenses on promissory notes issued to relatives of the Chairman & Chief Executive Officer of the Company | $ 78,982 | $ 78,792 |
Interest expense on lines of credit payable to the Chairman & Chief Executive Officer of the Company and his spouse | 314,737 | 356,454 |
Related party transactions including within selling, general and administration expenses: | ||
Consulting fees to the Chairman & Chief Executive Officer of the Company accrued on the line of credit available to the Company | 62,400 | 62,400 |
Related party transactions included within product development expenses | ||
Consulting fees to a relative of the Chairman and Chief Executive Officer of the Company | $ 30,000 |