Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 13, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | SOBR Safe, Inc | |
Entity Central Index Key | 0001425627 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Jun. 30, 2021 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 | |
Entity Common Stock Shares Outstanding | 25,981,203 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Entity File Number | 000-53316 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 26-0731818 | |
Entity Address Address Line 1 | 885 Arapahoe Avenue | |
Entity Address City Or Town | Boulder | |
Entity Address State Or Province | CO | |
Entity Address Postal Zip Code | 80302 | |
City Area Code | 844 | |
Local Phone Number | 762-7723 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 609,526 | $ 232,842 |
Prepaid expenses | 41,622 | 115,230 |
Total current assets | 651,148 | 348,072 |
SOBR Safe Intellectual Technology, net of accumulated amortization of $417,586 and $224,854 at June 30, 2021 and December 31, 2020, respectively | 3,437,089 | 3,629,821 |
Other assets | 8,680 | 8,680 |
Total Assets | 4,096,917 | 3,986,573 |
Current liabilities | ||
Accounts payable | 216,117 | 101,308 |
Accrued expenses | 299,688 | 313,032 |
Accrued interest payable | 134,227 | 134,444 |
Related party payables | 18,504 | 28,624 |
Common stock subscriptions payable | 209,354 | 253,688 |
Current portion notes payable - related parties | 11,810 | 11,810 |
Current portion notes payable - non-related parties | 104,183 | 79,183 |
Total current liabilities | 993,883 | 922,089 |
Notes payable -related parties-less current portion | ||
* Includes unamortized debt discount and beneficial conversion feature related to detached warrants and convertible notes of $897,603 and none at June 30, 2021 and December 31, 2020, respectively | 102,397 | 0 |
Notes payable -non-related parties-less current portion | ||
* Includes unamortized debt discount and beneficial conversion feature related to detached warrants and convertible notes of $901,121 and none at June 30, 2021 and December 31, 2020, respectively | 103,879 | 25,000 |
Total Liabilities | 1,200,159 | 947,089 |
Stockholders' Equity | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of June 30, 2021 and December 31, 2020 | 0 | 0 |
Common stock, $0.00001 par value; 100,000,000 shares authorized; 25,981,203 and 25,922,034 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively | 260 | 260 |
Additional paid-in capital | 55,096,399 | 52,693,974 |
Accumulated deficit | (52,146,273) | (49,601,220) |
Total SOBR Safe, Inc. stockholders' equity | 2,950,386 | 3,093,014 |
Noncontrolling interest | (53,628) | (53,530) |
Total Stockholders' Equity | 2,896,758 | 3,039,484 |
Total Liabilities and Stockholders' Equity | 4,096,917 | 3,986,573 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Equity | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of June 30, 2021 and December 31, 2020 | 0 | 0 |
Series A-1 Convertible Preferred stock [Member] | ||
Stockholders' Equity | ||
Preferred stock, $0.00001 par value; 19,300,000 shares authorized, no shares issued or outstanding as of June 30, 2021 and December 31, 2020 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
SOBR Safe Intellectual Technology, net of accumulated amortization | $ 417,586 | $ 224,854 |
Current liabilities | ||
Notes payable -related parties-less current portion | 897,603 | 897,603 |
Notes payable -non-related parties-less current portion | $ 901,121 | $ 901,121 |
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 | 25,981,203 | 25,922,034 |
Common stock, shares outstanding | 25,981,203 | 25,922,034 |
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 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Operating expenses: | ||||
General and administrative | 295,966 | 177,915 | 559,049 | 276,107 |
Stock-based compensation expense | 168,375 | 0 | 187,065 | 41,302 |
Management salaries and consulting fees | 535,815 | 461,864 | 1,049,593 | 683,993 |
Research and development | 314,532 | 89,570 | 485,995 | 157,280 |
Asset impairment adjustment | 0 | 25,320,555 | 29,222,955 | 25,320,555 |
Total operating expenses | 1,314,688 | 26,049,904 | 2,281,702 | 26,479,237 |
Loss from operations | (1,314,688) | (26,049,904) | (2,281,702) | (26,479,237) |
Other income (expense): | ||||
Loss on extinguishment of debt, net | 0 | (297,711) | 86,739 | (269,144) |
Gain on fair value adjustment - derivatives | 0 | 61,350 | 0 | 60,650 |
Interest expense | (146,028) | (17,397) | (171,906) | (65,631) |
Amortization of interest - beneficial conversion features | (82,001) | (1,407,501) | (91,543) | (1,407,675) |
Total other expense, net | (228,029) | (1,661,259) | (263,449) | (1,681,800) |
Loss before provision for income taxes | (1,542,717) | (27,711,163) | (2,545,151) | (28,161,037) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net loss | (1,542,717) | (27,711,163) | (2,545,151) | (28,161,037) |
Net loss attributable to noncontrolling interest | 4 | 199 | 98 | 50 |
Net loss attributable to SOBR Safe, Inc. | $ (1,542,713) | $ (27,710,964) | $ (2,545,053) | $ (28,160,987) |
Basic and diluted loss per common share | $ (0.06) | $ (2.45) | $ (0.10) | $ (2.97) |
Weighted average number of common shares outstanding | 25,978,390 | 11,330,815 | 25,970,402 | 9,484,508 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - USD ($) | Total | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Non controlling Interest [Member] | Stockholders Deficit SOBR Safe Inc [Member] |
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 compensation, shares | 601 | ||||||
Common stock issued for compensation, amount | 20,800 | $ 0 | 0 | 20,800 | 0 | 0 | 20,800 |
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 to settle related party payables, shares | 214,883 | ||||||
Common stock issued to settle related party payables, amount | 493,074 | $ 2 | 0 | 493,072 | 0 | 0 | 493,074 |
Common stock issued to settle accounts payable and accrued expenses, shares | 38,323 | ||||||
Common stock issued to settle accounts payable and accrued expenses, amount | 92,385 | $ 0 | 0 | 92,385 | 0 | 0 | 92,385 |
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 |
Paid-in capital - fair value of stock options vested | 39,450 | 0 | 0 | 39,450 | 0 | 0 | 39,450 |
Paid-in capital - gain on related party debt conversion | 124,291 | 0 | 0 | 124,291 | 0 | 0 | 124,291 |
Paid-in capital - gain on related party payables conversion | 221,557 | 0 | 0 | 221,557 | 0 | 0 | 221,557 |
Paid-in capital - loss on debt extinguishment | 116,893 | 0 | 0 | 116,893 | 0 | 0 | 116,893 |
Paid-in capital - beneficial conversion feature | 174 | 0 | 0 | 174 | 0 | 0 | 174 |
Net loss for the period | (449,874) | $ 0 | 0 | 0 | (450,023) | 149 | (450,023) |
Balance, shares at Mar. 31, 2020 | 7,880,084 | ||||||
Balance, amount at Mar. 31, 2020 | (1,875,153) | $ 78 | 0 | 18,139,221 | (19,961,191) | (53,261) | (1,821,892) |
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) |
Net loss for the period | (28,161,037) | ||||||
Balance, shares at Jun. 30, 2020 | 20,046,424 | ||||||
Balance, amount at Jun. 30, 2020 | 478,356 | $ 201 | 0 | 48,203,770 | (47,672,155) | (53,460) | 531,816 |
Balance, shares at Mar. 31, 2020 | 7,880,084 | ||||||
Balance, amount at Mar. 31, 2020 | (1,875,153) | $ 78 | 0 | 18,139,221 | (19,961,191) | (53,261) | (1,821,892) |
Common stock issued to settle related party payables, shares | 45,268 | ||||||
Common stock issued to settle related party payables, amount | 86,740 | $ 1 | 0 | 86,739 | 0 | 0 | 86,740 |
Common stock issued to settle accounts payable and accrued expenses, shares | 121,072 | ||||||
Common stock issued to settle accounts payable and accrued expenses, amount | 173,292 | $ 2 | 0 | 173,290 | 0 | 0 | 173,292 |
Paid-in capital - fair value of stock options vested | 257,482 | 0 | 0 | 257,482 | 0 | 0 | 257,482 |
Paid-in capital - gain on related party payables conversion | 50,741 | 0 | 0 | 50,741 | 0 | 0 | 50,741 |
Paid-in capital - beneficial conversion feature | 1,407,501 | 0 | 0 | 1,407,501 | 0 | 0 | 1,407,501 |
Net loss for the period | (27,711,163) | $ 0 | 0 | 0 | (27,710,964) | (199) | (27,710,964) |
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 |
Paid-in capital - fair value of stock warrants granted | 695,454 | 0 | 0 | 695,454 | 0 | 0 | 695,454 |
Paid-in capital - loss on extinguishment of convertible notes | 273,462 | $ 0 | 0 | 273,462 | 0 | 0 | 273,462 |
Balance, shares at Jun. 30, 2020 | 20,046,424 | ||||||
Balance, amount at Jun. 30, 2020 | 478,356 | $ 201 | 0 | 48,203,770 | (47,672,155) | (53,460) | 531,816 |
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 |
Paid-in capital - beneficial conversion feature | 480,619 | 0 | 0 | 480,619 | 0 | 0 | 480,619 |
Net loss for the period | (1,002,434) | $ 0 | 0 | 0 | (1,002,340) | (94) | (1,002,340) |
Common stock issued to settle dividends - Series A-1 Convertible Preferred stock, shares | 43,169 | ||||||
Common stock issued to settle dividends - Series A-1 Convertible Preferred stock, amount | 107,880 | $ 0 | 0 | 107,880 | 0 | 0 | 107,880 |
Paid-in capital - fair value of stock options and RSU vested | 105,013 | 0 | 0 | 105,013 | 0 | 0 | 105,013 |
Paid-in capital - relative fair value of stock warrants granted | 619,381 | $ 0 | 0 | 619,381 | 0 | 0 | 619,381 |
Balance, shares at Mar. 31, 2021 | 25,965,203 | ||||||
Balance, amount at Mar. 31, 2021 | 3,349,943 | $ 260 | 0 | 54,006,867 | (50,603,560) | (53,624) | 3,403,567 |
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 |
Net loss for the period | (2,545,151) | ||||||
Balance, shares at Jun. 30, 2021 | 25,981,203 | ||||||
Balance, amount at Jun. 30, 2021 | 2,896,758 | $ 260 | 0 | 55,096,399 | (52,146,273) | (53,628) | 2,950,386 |
Balance, shares at Mar. 31, 2021 | 25,965,203 | ||||||
Balance, amount at Mar. 31, 2021 | 3,349,943 | $ 260 | 0 | 54,006,867 | (50,603,560) | (53,624) | 3,403,567 |
Paid-in capital - beneficial conversion feature | 428,595 | 0 | 0 | 428,595 | 0 | 0 | 428,595 |
Net loss for the period | (1,542,717) | 0 | 0 | 0 | (1,542,713) | (4) | (1,542,713) |
Paid-in capital - fair value of stock options and RSU vested | 138,010 | 0 | 0 | 138,010 | 0 | 0 | 138,010 |
Paid-in capital - relative fair value of stock warrants granted | 473,327 | $ 0 | 0 | 473,327 | 0 | 0 | 473,327 |
Common stock issued for facility lease, shares | 16,000 | ||||||
Common stock issued for facility lease, amount | 49,600 | $ 0 | 0 | 49,600 | 0 | 0 | 49,600 |
Balance, shares at Jun. 30, 2021 | 25,981,203 | ||||||
Balance, amount at Jun. 30, 2021 | $ 2,896,758 | $ 260 | $ 0 | $ 55,096,399 | $ (52,146,273) | $ (53,628) | $ 2,950,386 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Operating Activities: | ||
Net loss | $ (2,545,151) | $ (28,161,037) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization | 192,732 | 33,227 |
Loss on debt extinguishment, net | 269,144 | |
Change in fair value of derivative liability | 0 | (60,650) |
Amortization of interest - beneficial conversion feature | 91,543 | 1,407,675 |
Amortization of interest | 111,655 | 8,656 |
Stock options expense | 140,726 | 296,932 |
Stock-based compensation expense | 187,065 | 41,302 |
Asset impairment adjustment | 0 | 25,320,555 |
Changes in assets and liabilities: | ||
Due from related party | 0 | (6,446) |
Prepaid expenses | 13,517 | (434) |
Other assets | 0 | (8,680) |
Accounts payable | 114,809 | 123,736 |
Accrued expenses | (13,344) | 39,644 |
Accrued interest payable | (217) | (47,675) |
Related party payables | (10,120) | (21,740) |
Common stock subscriptions payable | 88,469 | 0 |
Net cash used in operating activities | (1,628,316) | (765,791) |
Financing Activities: | ||
Proceeds from notes payable - related parties | 1,030,000 | 0 |
Repayments of notes payable - related parties | (30,000) | 0 |
Proceeds from notes payable - non-related parties | 1,005,000 | 41,665 |
Proceeds from offering of preferred stock - related parties | 0 | 770,000 |
Net cash provided by financing activities | 2,005,000 | 811,665 |
Net Change In Cash | 376,684 | 45,874 |
Cash At The Beginning Of The Period | 232,842 | 681,759 |
Cash At The End Of The Period | 609,526 | 727,633 |
Schedule Of Non-Cash Investing And Financing Activities: | ||
Prepaid expenses with common shares | 49,600 | 0 |
Issuance of common stock for prior year accrued dividends | 107,880 | 0 |
Intrinsic value-beneficial conversion feature | 909,214 | 1,407,501 |
Relative fair value of stock warrants granted | 1,092,708 | 0 |
Gain on related party payables converted to capital | 0 | 272,299 |
Accounts payable and accrued expenses converted to capital | 0 | 265,677 |
Related party payables converted to capital | 0 | 579,814 |
Related party debt converted to capital after exercise of cashless stock warrants | 0 | 65,728 |
Related party debt converted to capital | 0 | 826,964 |
Non-related party debt converted to capital | 0 | 166,526 |
Gain on related party debt converted to capital | 0 | 124,291 |
Shares issued for cash received in prior years | 0 | 20,800 |
Issuance of common stock, stock warrants and convertible note for asset purchase | 0 | 29,222,955 |
Supplemental Disclosure: | ||
Cash paid for interest | 62,491 | 765 |
Cash paid for income taxes | $ 0 | $ 0 |
ORGANIZATION, OPERATIONS AND SU
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2021 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 1. 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, TransBiotec was acquired by TransBiotec - CA in a transaction classified as a reverse acquisition as the shareholders of TransBiotec - CA retained the majority of the outstanding common stock of TransBiotec 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 14C providing notice that the Board of Directors has recommended, and that holders of a majority of the voting power of the Company’s outstanding stock voted, to approve the following. 1. To remove and re-elect four (4) directors to serve until the next Annual Meeting of Shareholders and thereafter until their successors are elected and qualified; and 2. To approve an amendment to the Company’s Certificate of Incorporation to: (a) change the Company’s name to SOBR SAFE, Inc., (b) decrease the Company’s authorized common stock from 800,000,000 shares, par value $0.00001 to 100,000,000 shares, par value $0.00001, and (c) effect a reverse stock split of the Company’s outstanding common stock at a ratio between 1-for-32 and 1-for-35 (with the exact ratio to be determined by the directors in their sole discretion without further approval by the shareholders). The above actions taken by the Company’s stockholders became effective on or about May 21, 2020. The effective dates of the above actions were June 5, 2020 and April 20, 2020, respectively, and the actual reverse stock split ratio was 1-for-33.26. All share and per share amounts have been adjusted in these consolidated financial statements to reflect the effect of the reverse stock split. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2021. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2021 and December 31, 2020, and results of operations and cash flows for the three and six month periods ended June 30, 2021 and 2020. Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiary, TransBiotec-CA. We have eliminated all intercompany transactions and balances between entities consolidated in these unaudited condensed financial statements. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the recoverability and useful lives of long-lived assets, the intellectual technology, the valuation of the derivative liabilities, beneficial conversion feature expenses, stock-based compensation and the valuation allowance related to deferred tax assets. 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. Cash The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. The Company does not have any cash equivalents as of June 30, 2021 and December 31, 2020. Cash held by escrow agent related to Offering proceeds is readily available to the Company with no restrictions, see Note 2. 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. Preferred Stock We apply the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any), which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity. Minority Interest (Noncontrolling Interest) A subsidiary of the Company has minority members representing ownership interests of 1.38% at June 30, 2021 and December 31, 2020. 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 common stock 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 $485,995 and $157,280 during the six month periods ended June 30, 2021 and 2020, respectively. Advertising and Marketing Costs Advertising and marketing costs are charged to operations as incurred. Advertising and marketing costs were $59,500 and $34,973 during the six month periods ended June 30, 2021 and 2020, respectively, and are included in general and administrative expenses in the consolidated statements of operations. 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 not recorded any deferred tax assets or liabilities at June 30, 2021 and December 31, 2020 as these have been offset by a 100% valuation allowance. 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 June 30, 2021 and December 31, 2020, the Company had no amounts in excess of the FDIC insured limits. 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 In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (S Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entitiy’s Own Equity (Subtpoic 815-40) Correction of Error While preparing financial statements for periods in 2021, the Company discovered an error in the statement of operations for the year ended December 31, 2020. The error related to the presentation of the loss on disposal of property and equipment and asset impairment adjustment in accordance with ASC 360-10-45. Loss on disposal of property and equipment and asset impairment adjustment of $39,434 and $25,320,555, respectively, were presented as other income/expense-net, instead of as operating expenses. As a result, loss from operations for the year ended December 31, 2020, was understated by $25,359,989 and other income/expenses-net was overstated by the same amount. The errors had no affect on the net loss or net loss per share for the year ended December 31, 2020. As a result of this correction, the statement of operations for the three and six month periods ended June 30, 2020 in the accompanying financial statements has been retroactively restated. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jun. 30, 2021 | |
GOING CONCERN | |
NOTE 2. 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 June 30, 2021, the Company has an accumulated deficit of approximately $52,146,000. During the six months ended June 30, 2021, the Company also experienced negative cash flows from operating activities of approximately $1,628,000 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 per share, and a Warrant to purchase 25,000 shares of the Company’s common stock at $3 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 closed on May 31, 2021 and raised $2,005,000, see Note 7. As of June 30, 2021, the Company has received $1,505,000 of the Offering proceeds, of which $500,000 is readily available in the cash escrow account. We will need additional funds beyond the money raised in this Offering. 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 an 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 June 30, 2021. 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 June 30, 2021. |
ASSET PURCHASE
ASSET PURCHASE | 6 Months Ended |
Jun. 30, 2021 | |
ASSET PURCHASE | |
NOTE 3. 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. 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 | 6 Months Ended |
Jun. 30, 2021 | |
PREPAID EXPENSES | |
NOTE 4. PREPAID EXPENSES | NOTE 4. PREPAID EXPENSES Prepaid expenses consist of the following: June 30, 2021 December 31, 2020 Consulting service $ - $ 111,860 Rent 33,067 - Insurance 8,555 3,370 Prepaid expenses $ 41,622 $ 115,230 On February 26, 2021, the Company entered into a new lease agreement for its office facility for a 12-month term beginning March 1, 2021. In addition to monthly base rent of $6,000, the agreement requires the issuance on 16,000 shares of its common stock valued at $49,600, all of which has been issued as of June 30, 2021. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2021 | |
INTANGIBLE ASSETS | |
NOTE 5. INTANGIBLE ASSETS | NOTE 5. INTANGIBLE ASSETS Intangible assets consist of the following at June 30, 2021: Gross Carrying Accumulated Net Intangible Amortization Period Amount Amortization Asset (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 417,586 $ 3,437,089 10 Amortization expense for the six-month period ended June 30, 2021 and 2020 was $192,732 and 32,122, respectively, and is included in general and administrative expenses in the consolidated statements of operations. Estimated future amortization expense for device technology intangible assets is as follows: 2022 2023 2024 2025 2026 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,509,754 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2021 | |
RELATED PARTY TRANSACTIONS | |
NOTE 6. RELATED PARTY TRANSACTIONS | NOTE 6. RELATED PARTY TRANSACTIONS On July 1, 2015, the Company amended a December 3, 2014, note payable agreement with Lanphere Law Group, a related party and shareholder, which forgave $108,000 of a 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 three months ended March 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. 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 former 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. On February 12, 2021, the Company entered into a note payable agreement with David Gandini, an officer and shareholder, under which Mr. Gandini advanced the Company $30,000 for working capital purposes. The unsecured note carried interest at 0% and was paid in April 2021. On March 30, 2021, the Company received notification from IDTEC that it was exercising a portion of the 320,000 warrants issued resulting from the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with IDTEC. The warrant exercise price is $0.50 per share. With the proceeds of the exercise we paid $88,469 during the six-month period ended June 30, 2021 to settle an outstanding judgement (see Note 13) against the Company which was considered as a non-permitted liability under the Post-Closing Covenant Agreement. We will issue 176,938 shares of our common stock for the $88,469 we received from IDTEC to pay the settlement. As the shares had not been issued by June 30, 2021, the amount received from IDTEC is included in the common stock subscriptions payable balance at June 30, 2021. On March 3 and 31, 2021, the Company issued convertible notes payable (see Note 7) totaling $450,000 to existing shareholders holding a direct or indirect interest in the Company and $100,000 to a Company’s director and another director’s family member. The principal amount of the secured convertible debentures are convertible at $3 per share, and include warrants to purchase in total 275,000 shares of the Company’s common stock at $3 per share. On May 31, 2021, the Company issued convertible notes payable (see Note 7) totaling $400,000 to existing shareholders holding a direct or indirect interest in the Company and $50,000 to a Company’s officer. The principal amount of the secured convertible debentures are convertible at $3 per share, and include warrants to purchase in total 225,000 shares of the Company’s common stock at $3 per share. |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2021 | |
NOTES PAYABLE | |
NOTE 7. NOTES PAYABLE | NOTE 7. NOTES PAYABLE RELATED PARTIES Related party notes payable consist of the following: June 30, 2021 December 31, 2020 Convertible Notes Payable with Detached Free-standing Warrants $ 1,000,000 $ - Conventional Non-Convertible Notes Payable 11,810 11,810 Unamortized Debt Discount (897,603 ) - Net Related Party Notes Payable $ 114,207 $ 11,810 Current Portion (11,810 ) (11,810 ) Net Long-Term Portion $ 102,397 $ - Total interest expense for related party notes was $24,904 and $42,161 for the six month period ended June 30, 2021 and 2020, respectively. Related Party Convertible Notes Payable with Warrants The Company has thirteen convertible notes payable to related parties, each with detached free-standing warrants to purchase the Company’s common stock at $3 per share, that have a total principal balance of $1,000,000 as of June 30, 2021. The notes, secured by the Company’s patents and patents applications, include interest at 12%, are convertible at $3 per share of the Company’s common stock and are due 24 months after issuance. The note holders may elect to have the interest paid in cash monthly or have the interest accrue and be payable on the maturity date. Interest elected to be accrued 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 notes contain both voluntary and automatic conversion features. The notes will be convertible at any time, by the holders, beginning on the date of issuance. However, the holders may not convert any outstanding amounts due under the note if at the time of such conversion the amount of common stock issued for the conversion, when added to other shares of Company common stock owned by the holders or which can be acquired by holders upon exercise or conversion of any other instrument, would cause the holder to own more than 4.9% of the Company’s outstanding common stock. Beginning on the issuance date, the outstanding principal amount of the note, and any accrued interest, will automatically convert into shares of the Company’s common stock if the Company’s common stock closes at or above $6 per share for five (5) consecutive trading days while listed on NASDAQ. The Company evaluated the convertible notes payable for derivative embedded and beneficial conversion features. The Company determined that there were beneficial conversion features to record. The total beneficial conversion feature debt discount of $448,999 is amortized over the life of the convertible notes payable. The debt discount amortization expense recorded as amortization of interest – beneficial conversion feature in the consolidated statements of operations was $46,155 for the six-month period ended June 30, 2021. As of June 30, 2021, these notes carry outstanding warrants of 500,000. The relative fair market value of the related stock warrants granted during the six-month period ended June 30, 2021 and 2020 was $551,001 and none, respectively. The unamortized discount at June 30, 2021 and December 31, 2020 is $494,759 and none, respectively. Stock warrants amortization expense recorded as interest expense was $56,242 for the six-month period ended June 30, 2021. Related Party Convertible Notes Payable 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 non-convertible note payable to a related party that has a principal balance of $11,810 as of June 30, 2021 and December 31, 2020. The note carries an interest rate at 0%. The note payable had a due date of December 31, 2012 and is currently in default. NON-RELATED PARTIES Non-related party notes payable consist of the following: June 30, 2021 December 31, 2020 Convertible Notes Payable with Detached Free-standing Warrants $ 1,005,000 $ - Convertible Notes Payable 56,683 56,683 Conventional Non-Convertible Notes Payable 42,500 42,500 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Unamortized Debt Discount (901,121 ) - Net Non-Related Party Notes Payable $ 208,062 $ 104,183 Current Portion (104,183 ) (79,183 ) Net Long-Term Portion $ 103,879 $ 25,000 Total interest expense for non-related party notes was $31,614 and $10,885 for the six-month periods ended June 30, 2021 and 2020, respectively. Convertible Notes Payable with Warrants The Company has sixteen convertible notes payable to non-related parties, each with detached free-standing warrants to purchase the Company’s common stock at $3 per share, that have a total principal balance of $1,005,000 as of June 30, 2021. The notes, secured by the Company’s patents and patents applications, include interest at 12%, are convertible at $3 per share of the Company’s common stock and are due 24 months after issuance. The note holders may elect to have the interest paid in cash monthly or have the interest accrue and be payable on the maturity date. Interest elected to be accrued 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 notes contain both voluntary and automatic conversion features. The notes will be convertible at any time, by the holders, beginning on the date of issuance. However, the holders may not convert any outstanding amounts due under the note if at the time of such conversion the amount of common stock issued for the conversion, when added to other shares of Company common stock owned by the holders or which can be acquired by holders upon exercise or conversion of any other instrument, would cause the holder to own more than 4.9% of the Company’s outstanding common stock. Beginning on the issuance date, the outstanding principal amount of the note, and any accrued interest, will automatically convert into shares of the Company’s common stock if the Company’s common stock closes at or above $6 per share for five (5) consecutive trading days while listed on NASDAQ. The Company evaluated the convertible notes payable for derivative embedded and beneficial conversion features. The Company determined that there were beneficial conversion features to record. The total beneficial conversion feature debt discount of $460,215 is amortized over the life of the convertible notes payable. The debt discount recorded as amortization of interest – beneficial conversion feature in the consolidated statements of operations was $45,388 for the six-month period ended June 30, 2021. As of June 30, 2021, these notes carry outstanding warrants of 502,500. The relative fair market value of the related stock warrants granted during the six-month period ended June 30, 2021 and 2020 was $541,707 and none, respectively. The unamortized discount at June 30, 2021 and December 31, 2020 was $486,294 and none, respectively. Stock warrants amortization expense recorded as interest expense was $55,413 for the six-month period ended June 30, 2021. Convertible Notes Payable The Company has three convertible notes payable to non-related parties that have a principal balance of $56,683 as of June 30, 2021 and December 31, 2020. These notes carry interest rates ranging from 5% - 12% and have due dates ranging from 2/19/2013 – 3/06/2022. Two of the three notes are currently in default. These notes carry conversion prices ranging from $1.99- $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 prior to 2020. During the three months ended March 31, 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with six non-related parties, under which the Company agreed to issue 50,135 shares of its common stock in exchange for a reduction of eleven convertible notes payable to non-related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $166,750 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 the three months ended March 31, 2020, the Company 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 as of June 30, 2021, and December 31, 2020. These notes carry interest rates ranging from 5% - 10% and have due dates ranging from 12/25/2013 - 6/06/2022. Two of the three notes are currently 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 as of June 30, 2021 and December 31, 2020. 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. |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 6 Months Ended |
Jun. 30, 2021 | |
DERIVATIVE LIABILITY | |
NOTE 8. DERIVATIVE LIABILITY | NOTE 8. DERIVATIVE LIABILITY In 2019, the Company borrowed $70,000 under convertible promissory notes agreement from an unrelated party that are due upon demand. The notes bear interest at a rate of 10% per annum and are convertible into the Company’s common shares at a variable conversion price based on a 50% discount of the market price at an undetermined future date. The Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASU 2017-11 (ASC 815-15, Derivatives and Hedging), and determined the embedded conversion features should be classified as a derivative because the exercise price of the convertible note is subject to a variable conversion rate and should therefore be accounted for at fair value under ASC 820, Fair Value Measurements and Disclosures, Financial Instruments The embedded derivatives 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 consolidated 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 at December 31, 2020. Utilizing level 3 inputs, the Company recorded a fair market value gain of none and $60,650 for the six months ended June 30, 2021 and 2020, respectively. |
STOCK SUBSCRIPTIONS PAYABLE
STOCK SUBSCRIPTIONS PAYABLE | 6 Months Ended |
Jun. 30, 2021 | |
STOCK SUBSCRIPTIONS PAYABLE | |
NOTE 9. STOCK SUBSCRIPTIONS PAYABLE | NOTE 9. STOCK SUBSCRIPTIONS PAYABLE The Company has common stock subscriptions payable due to related parties of $91,613 payable with 193,856 of its common shares at June 30, 2021. The Company has common stock subscriptions payable due to related parties of $111,024 payable with 60,087 of its common shares at December 31, 2020. The Company has common stock subscriptions payable due to non-related parties of $117,741 payable with 87,500 of its common shares at June 30, 2021 and December 31,2020. |
COMMON STOCK
COMMON STOCK | 6 Months Ended |
Jun. 30, 2021 | |
COMMON STOCK | |
NOTE 10. COMMON STOCK | NOTE 10. COMMON STOCK The Company’s common stock transactions for the six months ended June 30, 2020, consist of the following: The Company issued 601 shares of its common stock for compensation for services rendered. The Company issued 454,097 shares of its common stock 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. The Company issued 214,883 shares of its common stock for the settlement of related party payables of $714,700. A related party gain of approximately $222,000 was recorded as additional paid-in capital from the stock issuance. The Company issued 38,323 shares of its common stock for the settlement of accounts payables and accrued expenses of approximately $127,000. The Company recorded a net gain of approximately $27,000 from the stock issuance. The Company issued 648,739 shares of its common stock 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 as additional paid in-capital as a result of the stock issuance. The Company issued 70,448 shares of its common stock 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. The Company agreed to convert 121,072 shares of its common stock at values between $0.5821 to $1.039 per share to non-related parties in exchange for their agreement to settle payable balances of $91,464 owed to them. The conversion was in full satisfaction of all outstanding amounts owed. The Company recorded a non-related party loss of $81,867 as other expense in the consolidated statements of operations. The Company issued 45,268 shares of its common stock to related parties in exchange for their agreement to settle related party accounts payable of $137,496 owed to them. The shares were issued at a value of $86,739 and recorded a related party gain of $50,741 to additional paid-in-capital. The Company issued 12,000,000 shares of its common stock valued at $2.26 as result of the Transaction with IDTEC (see Note 3). The Company’s common stock transactions for the six months ended June 30, 2021, consist of the following: The Company issued 43,169 shares of its common stock to SOBR Safe, LLC, an entity controlled by a beneficial owner of the Company, in full satisfaction of $107,880 of accrued dividends resulting from the December 2020 conversion of the Series A-1 Convertible Preferred Stock into common shares, see Note 11. The Company issued 16,000 shares of its common stock valued at $49,600 to its landlord under the terms of a lease agreement expiring in February 2022. The amount has been recorded as prepaid expense and amortized monthly over the lease term as general and administrative expense in the consolidated statement of operations. |
PREFERRED STOCK
PREFERRED STOCK | 6 Months Ended |
Jun. 30, 2021 | |
PREFERRED STOCK | |
NOTE 11. 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 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 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 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 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 of Series A-1 Convertible Preferred Stock. 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, which were issued in January 2021. |
STOCK WARRANTS AND STOCK OPTION
STOCK WARRANTS AND STOCK OPTIONS | 6 Months Ended |
Jun. 30, 2021 | |
STOCK WARRANTS AND STOCK OPTIONS | |
NOTE 12. STOCK WARRANTS AND STOCK OPTIONS | NOTE 12. STOCK WARRANTS AND STOCK OPTIONS Stock Warrants The Company accounts for employee stock options and 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. 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 per share on December 12, 2019. Upon purchase, the Company issued the SPV through FCV a three-year warrant to purchase 144,317 shares of the Company’s common stock at an exercise price of $1.039375 per share. The number of warrants outstanding to the SPV through FCV at June 30, 2021 and December 31, 2020 are 144,317. 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, at closing of the Transaction, the Company entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement under which we issued warrants to IDTEC to purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share. The warrants expire five years after the date of issuance. During March, April and May 2021, the Company issued through the Offering convertible notes payable with warrants, see Note 7, to purchase up to 1,002,500 shares of our common stock at an exercise price of $3 per share. The warrants expire two years after the date of issuance. The total outstanding balance of all stock warrants in the Company is 1,409,879 and 584,317 at June 30, 2021 and December 31 2020, respectively. There were 1,002,500 detached free-standing stock warrants granted during the six-month period ended June 30, 2021, and 320,000 detached free-standing stock warrants granted during the six month period ended June 30, 2020. The fair value of these non-employee stock warrants granted during the six-month periods ended June 30, 2021 and 2020 totaled $1,092,708 and $695,454, respectively, and were determined using the Black-Scholes option pricing model based on the following assumptions: June 30, 2021 June 30, 2020 Exercise Price $ 3.00 $ 0.50 Dividend Yield 0 % 0 % Volatility 158 % 153 % Risk-free Interest Rate 0.14%-0.16 % 0.29 % Life of Warrants 2 Years 5 Years The following table summarizes the changes in the Company’s outstanding warrants during the six-month period ended June 30, 2021 and 2020, and as of June 30, 2021 and 2020: Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 598,414 $ 0.13304 –1.039375 3.97 Years $ 0.3607 $ 1,276,870 Warrants Granted 320,000 $ 0.50 4.93Years $ 0.50 $ 768,000 Warrants Exercised (454,097 ) $ 0.13304 - 0.15299 $ 0.1451 Warrants Expired - Balance at June 30, 2020 464,317 $ 0.50- 1.039375 4.16 Years $ 0.66765 $ 1,036,521 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, 2020 584,317 $ 0.50 – 2.00 3.80 Years $ 0.9413 $ 1,173,737 Warrants Granted 1,002,500 $ 3.00 1.79 Years $ 3.00 $ 952,375 Warrants Exercised (176,938 ) $ 0.50 $ 0.50 Warrants Expired - Balance at June 30, 2021 1,409,879 $ 0.50 – 3.00 2.15 Years $ 2.4605 $ 2,099,993 Stock Options On October 24, 2019, the Company’s 2019 Equity Incentive Plan went effective. The plan was approved by the Company’s Board of Directors and the holders of a majority of the Company’s voting stock on September 9, 2019. The plan’s number of authorized shares is 3,848,467. As of June 30, 2021 and December 31, 2020, the Company has granted stock options to acquire 2,909,422 and 2,521,921 shares of common stock under the plan, respectively. As of June 30, 2021, the plan has 1,600,986 vested shares and 1,308,436 non-vested shares. As of December 31, 2020, the plan had 1,202,724 vested shares and 1,319,197 non-vested shares. As of June 30, 2021 and December 31, 2020 the plan has options available to be issued of 939,045 and 1,326,546, respectively. The stock options are held by our officers, directors, employees, and certain key consultants. In total for the six months ended June 30, 2021 and 2020, the Company recorded $243,023 and $296,932, respectively, of share-based compensation expense related to stock options and restricted stock units. The unrecognized compensation expense as of June 30, 2021, was approximately $1,325,000 for non-vested share-based awards to be recognized over periods of approximately one 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 six-month period ended June 30, 2021 and 2020 were as follows: June 30, 2021 June 30, 2020 Exercise Price $ 2.77 - $3.38 $ 2.00 Dividend Yield 0 % 0 % Expected Volatility 152% - 158 % 153 % Risk-free Interest Rate 0.27% - 0.34 % 0.29 % Expected Life 2 - 5 years 5 years The following table summarizes the changes in the Company’s outstanding stock options during the six-month period ended June 30, 2021 and 2020, and as of June 30, 2021 and 2020: Options Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 2,381,239 $ 0.2634-1.039 8.86 Years $ 0.2948 $ 5,238,080 Options Granted 140,000 $ 0.26341-2.00 4.54 Years $ 1.7504 $ 160,732 Options Exercised - Options Cancelled - Options Expired - Balance at June 30, 2020 2,521,239 $ 0.2634 – 2.00 8.15 Years $ 0.3170 $ 6,512,360 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, 2020 2,572,227 $ 0.2634– 3.300 7.45 Years $ 0.4999 $ 6,302,277 Options Granted 387,500 $ 2.772 – 3.377 2.94 Years $ 3.2854 $ 257,540 Options Exercised - Options Cancelled - Options Expired - Balance at June 30, 2021 2,959,727 $ 0.2634 – 3.377 6.43 Years $ 0.8646 $ 9,132,060 Exercisable at December 31, 2020 1,253,030 $ 0.2634 – 3.300 7.4 Years $ 0.3165 $ 3,299,765 Exercisable at June 30, 2021 1,651,291 $ 0.2634 – 3.377 6.78 Years $ 0.4540 $ 5,772,880 Executive Stock Options The Company has 1,328,230 and 981,771 outstanding executive stock options exercisable at $0.2634 to $3.38 per share as of June 30, 2021, and December 31, 2020, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 13. COMMITMENTS AND CONTINGENCIES | NOTE 13. COMMITMENTS AND CONTINGENCIES Operating Leases 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 lease was subsequently canceled to accommodate additional space, and a new lease was executed February 26, 2021, effective for a 12-month term beginning March 1, 2021. The lease requires monthly base rent payments of $6,000 and the issuance of 16,000 shares of the Company’s common stock. The value of the common stock of $49,600 is amortized to rent expense on a monthly basis over the lease term. The Company also leases an office space for approximately $1,800 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 $65,197 and $42,348 for the six-month period ended June 30, 2021 and 2020, 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 the date of this report. As of June 30, 2021, and December 31, 2020, the Company has accrued $11,164 plus accrued interest of approximately $17,000. 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 had one outstanding judgment against us involving a past employee of the Company. The matter was under the purview of the State of California, Franchise Tax Board, Industrial Health and Safety Collections. We owed $28,786 plus accrued interest of approximately $53,000, which had 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 $85,000 including accrued interest through settlement date and legal fees of approximately $3,000. IDTEC agreed, in connection with us closing the asset purchase transaction with IDTEC, to pay the amounts for us in exchange for shares of our common stock. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2021 | |
SUBSEQUENT EVENTS | |
NOTE 14. SUBSEQUENT EVENTS | NOTE 14. SUBSEQUENT EVENTS The Company has evaluated subsequent events for recognition and disclosure through August 16, 2021, which is the date the condensed consolidated financial statements were available to be issued, and has determined that there are no other material subsequent events that require recognition or disclosure in the accompanying condensed consolidated financial statements. |
ORGANIZATION, OPERATIONS AND _2
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2021. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2021 and December 31, 2020, and results of operations and cash flows for the three and six month periods ended June 30, 2021 and 2020. |
Principles of consolidation | The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiary, TransBiotec-CA. We have eliminated all intercompany transactions and balances between entities consolidated in these unaudited condensed financial statements. |
Use of Estimates | The preparation of unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the recoverability and useful lives of long-lived assets, the intellectual technology, the valuation of the derivative liabilities, beneficial conversion feature expenses, stock-based compensation and the valuation allowance related to deferred tax assets. 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. |
Cash | The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. The Company does not have any cash equivalents as of June 30, 2021 and December 31, 2020. Cash held by escrow agent related to Offering proceeds is readily available to the Company with no restrictions, see Note 2. |
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. |
Preferred Stock | We apply the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any), which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity. |
Minority Interest (Noncontrolling Interest) | A subsidiary of the Company has minority members representing ownership interests of 1.38% at June 30, 2021 and December 31, 2020. 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 common stock 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 $485,995 and $157,280 during the six month periods ended June 30, 2021 and 2020, respectively. |
Advertising and Marketing Costs | Advertising and marketing costs are charged to operations as incurred. Advertising and marketing costs were $59,500 and $34,973 during the six month periods ended June 30, 2021 and 2020, respectively, and are included in general and administrative expenses in the consolidated statements of operations. |
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 not recorded any deferred tax assets or liabilities at June 30, 2021 and December 31, 2020 as these have been offset by a 100% valuation allowance. |
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 June 30, 2021 and December 31, 2020, the Company had no amounts in excess of the FDIC insured limits. |
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 In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (S Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entitiy’s Own Equity (Subtpoic 815-40) |
Correction of Error | While preparing financial statements for periods in 2021, the Company discovered an error in the statement of operations for the year ended December 31, 2020. The error related to the presentation of the loss on disposal of property and equipment and asset impairment adjustment in accordance with ASC 360-10-45. Loss on disposal of property and equipment and asset impairment adjustment of $39,434 and $25,320,555, respectively, were presented as other income/expense-net, instead of as operating expenses. As a result, loss from operations for the year ended December 31, 2020, was understated by $25,359,989 and other income/expenses-net was overstated by the same amount. The errors had no affect on the net loss or net loss per share for the year ended December 31, 2020. As a result of this correction, the statement of operations for the three and six month periods ended June 30, 2020 in the accompanying financial statements has been retroactively restated. |
ASSET PURCHASE (Tables)
ASSET PURCHASE (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
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) | 6 Months Ended |
Jun. 30, 2021 | |
PREPAID EXPENSES | |
Schedule of prepaid expenses | June 30, 2021 December 31, 2020 Consulting service $ - $ 111,860 Rent 33,067 - Insurance 8,555 3,370 Prepaid expenses $ 41,622 $ 115,230 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
INTANGIBLE ASSETS | |
Summary of Intangible Assets | Gross Carrying Accumulated Net Intangible Amortization Period Amount Amortization Asset (in years) SOBR Safe Intellectual Technology $ 3,854,675 $ 417,586 $ 3,437,089 10 |
Schedule of estimated future amortization expense | 2022 2023 2024 2025 2026 Thereafter $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 385,467 $ 1,509,754 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
NOTES PAYABLE | |
Schedule of notes payables - related parties | June 30, 2021 December 31, 2020 Convertible Notes Payable with Detached Free-standing Warrants $ 1,000,000 $ - Conventional Non-Convertible Notes Payable 11,810 11,810 Unamortized Debt Discount (897,603 ) - Net Related Party Notes Payable $ 114,207 $ 11,810 Current Portion (11,810 ) (11,810 ) Net Long-Term Portion $ 102,397 $ - |
Schedule of notes payables - non related parties | June 30, 2021 December 31, 2020 Convertible Notes Payable with Detached Free-standing Warrants $ 1,005,000 $ - Convertible Notes Payable 56,683 56,683 Conventional Non-Convertible Notes Payable 42,500 42,500 Notes Payable with Detached Free-standing Warrants 5,000 5,000 Unamortized Debt Discount (901,121 ) - Net Non-Related Party Notes Payable $ 208,062 $ 104,183 Current Portion (104,183 ) (79,183 ) Net Long-Term Portion $ 103,879 $ 25,000 |
STOCK WARRANTS AND STOCK OPTI_2
STOCK WARRANTS AND STOCK OPTIONS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
STOCK WARRANTS AND STOCK OPTIONS | |
Schedule of fair value of non-employee stock/warrants | June 30, 2021 June 30, 2020 Exercise Price $ 3.00 $ 0.50 Dividend Yield 0 % 0 % Volatility 158 % 153 % Risk-free Interest Rate 0.14%-0.16 % 0.29 % Life of Warrants 2 Years 5 Years Warrants Outstanding Number of Shares Exercise Price Per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2019 598,414 $ 0.13304 –1.039375 3.97 Years $ 0.3607 $ 1,276,870 Warrants Granted 320,000 $ 0.50 4.93Years $ 0.50 $ 768,000 Warrants Exercised (454,097 ) $ 0.13304 - 0.15299 $ 0.1451 Warrants Expired - Balance at June 30, 2020 464,317 $ 0.50- 1.039375 4.16 Years $ 0.66765 $ 1,036,521 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, 2020 584,317 $ 0.50 – 2.00 3.80 Years $ 0.9413 $ 1,173,737 Warrants Granted 1,002,500 $ 3.00 1.79 Years $ 3.00 $ 952,375 Warrants Exercised (176,938 ) $ 0.50 $ 0.50 Warrants Expired - Balance at June 30, 2021 1,409,879 $ 0.50 – 3.00 2.15 Years $ 2.4605 $ 2,099,993 |
Schedule of fair value of stock options | June 30, 2021 June 30, 2020 Exercise Price $ 2.77 - $3.38 $ 2.00 Dividend Yield 0 % 0 % Expected Volatility 152% - 158 % 153 % Risk-free Interest Rate 0.27% - 0.34 % 0.29 % Expected Life 2 - 5 years 5 years |
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, 2019 2,381,239 $ 0.2634-1.039 8.86 Years $ 0.2948 $ 5,238,080 Options Granted 140,000 $ 0.26341-2.00 4.54 Years $ 1.7504 $ 160,732 Options Exercised - Options Cancelled - Options Expired - Balance at June 30, 2020 2,521,239 $ 0.2634 – 2.00 8.15 Years $ 0.3170 $ 6,512,360 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, 2020 2,572,227 $ 0.2634– 3.300 7.45 Years $ 0.4999 $ 6,302,277 Options Granted 387,500 $ 2.772 – 3.377 2.94 Years $ 3.2854 $ 257,540 Options Exercised - Options Cancelled - Options Expired - Balance at June 30, 2021 2,959,727 $ 0.2634 – 3.377 6.43 Years $ 0.8646 $ 9,132,060 Exercisable at December 31, 2020 1,253,030 $ 0.2634 – 3.300 7.4 Years $ 0.3165 $ 3,299,765 Exercisable at June 30, 2021 1,651,291 $ 0.2634 – 3.377 6.78 Years $ 0.4540 $ 5,772,880 |
ORGANIZATION, OPERATIONS AND _3
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
May 21, 2020 | Mar. 23, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Research and development costs | $ 314,532 | $ 89,570 | $ 485,995 | $ 157,280 | |||
Impairment loss | 39,434 | 25,320,555 | |||||
Loss from operation | (1,314,688) | $ (26,049,904) | (2,281,702) | (26,479,237) | $ (25,359,989) | ||
Advertising and marketing costs | $ 59,500 | $ 34,973 | |||||
Valuation allowance, percentage | 100.00% | 100.00% | |||||
FDIC insured limit | $ 250,000 | $ 250,000 | |||||
Ownership interest, percentage | 1.38% | 1.38% | 1.38% | ||||
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||
Common stock, par value | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||
Annual Meeting of Shareholders [Member] | |||||||
Common stock, shares authorized | 100,000,000 | 800,000,000 | 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 ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Accumulated deficit | $ (52,146,273) | $ (49,601,220) | ||
Net cash used in operating activities | $ (1,628,000) | (1,628,316) | $ (765,791) | |
Private Offering [Member] | January 15, 2021 [Member] | ||||
Additional offering amount | 500,000 | |||
Termination date description | 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 per share, and a Warrant to purchase 25,000 shares of the Company’s common stock at $3 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 closed on May 31, 2021 and raised $2,005,000, see Note 7. As of June 30, 2021 | |||
Offering amount | $ 1,505,000 |
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 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | May 31, 2021 | Mar. 31, 2021 |
Liability required | $ 125,000 | $ 158,000 | $ 158,000 | ||||
Exercise price per share | $ 0.50 | ||||||
Market price of shares | $ 27,120,000 | ||||||
Assets purchase upon shares issued | $ 29,222,955 | 1,407,051 | $ 1,407,051 | ||||
Assets purchase upon shares issued, shares | 12,000,000 | ||||||
Common stock issuable upon exercise of warrant, shares | 320,000 | ||||||
Asset impairment loss | 0 | $ 25,320,555 | $ 29,222,955 | $ 25,320,555 | |||
Fair value of warrants issued | $ 695,454 | $ 695,454 | |||||
Description of fair value of assets evaluation | 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 | ||||||
Convertible Notes Payable | $ 225,000 | $ 275,000 | |||||
Asset Purchase Agreement [Member] | IDTEC [Member] | |||||||
Common stock, shares issued upon assets purchase | 12,000,000 | ||||||
Convertible notes, conversion price | $ 0.50 | $ 0.50 | |||||
Interest rate | 10.00% | ||||||
Convertible Notes Payable | $ 1,485,189 | $ 1,485,189 |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
ASSET PURCHASE | ||
Consulting services | $ 0 | $ 111,860 |
Rent | 33,067 | 0 |
Insurance | 8,555 | 3,370 |
Prepaid expenses | $ 41,622 | $ 115,230 |
PREPAID EXPENSES (Details Narra
PREPAID EXPENSES (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Rent | $ 65,197 | $ 42,348 |
Lease Agreement [Member] | ||
Prepaid expenses with common shares | $ 49,600 | |
Common stock issued | 16,000 | |
Rent | $ 6,000 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2020 | |
Intangible assets, net | $ 3,437,089 | $ 3,629,821 |
Intellectual Technology [Member] | ||
Intangible assets, gross | 3,854,675 | |
Accumulated amortization | 417,586 | |
Intangible assets, net | $ 3,437,089 | |
Amortization Period | 10 years |
INTANGIBLE ASSETS (Details 1)
INTANGIBLE ASSETS (Details 1) | Jun. 30, 2021USD ($) |
INTANGIBLE ASSETS | |
2022 | $ 385,467 |
2023 | 385,467 |
2024 | 385,467 |
2025 | 385,467 |
2026 | 385,467 |
Thereafter | $ 1,509,754 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
INTANGIBLE ASSETS | ||
Amortization expense | $ 192,732 | $ 33,227 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Dec. 07, 2020 | Jun. 05, 2020 | Apr. 07, 2020 | Apr. 06, 2020 | Jan. 03, 2020 | Jul. 02, 2015 | May 31, 2021 | Mar. 31, 2021 | Mar. 30, 2021 | Mar. 23, 2020 | Jan. 30, 2020 | Jan. 16, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Feb. 12, 2021 | Dec. 31, 2020 | Mar. 08, 2017 | Jul. 01, 2015 |
Exercise price | $ 112,871 | |||||||||||||||||||
Warrants purchased | 250,000 | |||||||||||||||||||
Convertible notes payable | $ 225,000 | $ 275,000 | ||||||||||||||||||
Debt conversion rate | $ 1.41 | $ 3.326 | $ 3 | $ 3 | ||||||||||||||||
Debt amount after debt forgiveness | $ 31,662 | |||||||||||||||||||
Issuance of convertible notes payable | 450,000 | |||||||||||||||||||
Indirect interest amount recieved | $ 50,000 | $ 100,000 | ||||||||||||||||||
Acquired shares | 969,601 | |||||||||||||||||||
Common stock, shares issued | 25,981,203 | 25,981,203 | 25,922,034 | |||||||||||||||||
Gain on related party debt conversion | $ 42,000 | $ 0 | $ (297,711) | $ 86,739 | $ (269,144) | |||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 45,268 | |||||||||||||||||||
Accrued interest | $ 299,688 | $ 299,688 | $ 313,032 | |||||||||||||||||
Director [Member] | ||||||||||||||||||||
Convertible notes payable | $ 400,000 | |||||||||||||||||||
David Gandini [Member] | ||||||||||||||||||||
Working capital | $ 30,000 | |||||||||||||||||||
Unseured note interest rate | 0.00% | |||||||||||||||||||
IDTEC [Member] | ||||||||||||||||||||
Warrants purchased | 320,000 | 320,000 | ||||||||||||||||||
Warrants exercise price | $ 0.50 | $ 0.50 | ||||||||||||||||||
Settlement of outstanding judgement | $ 88,469 | |||||||||||||||||||
Common stock issue for settlement | 176,938 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 12,000,000 | |||||||||||||||||||
Nick Noceti [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Purchase price of shares issued | $ 127,480 | |||||||||||||||||||
Reduction in related party debt | $ 127,840 | |||||||||||||||||||
Common stock, shares issued | 38,437 | |||||||||||||||||||
Gain on related party debt conversion | $ 49,000 | |||||||||||||||||||
Charles Bennington [Member] | ||||||||||||||||||||
Debt conversion rate | $ 1.41 | |||||||||||||||||||
Purchase price of shares issued | $ 9,656 | $ 3 | ||||||||||||||||||
Reduction in related party debt | $ 9,656 | |||||||||||||||||||
Common stock, shares issued | 6,831 | |||||||||||||||||||
Gain on related party debt conversion | $ 2,000 | |||||||||||||||||||
Prakash Gadgil [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Purchase price of shares issued | $ 1,950 | |||||||||||||||||||
Reduction in related party debt | 1,950 | |||||||||||||||||||
Gain on related party debt conversion | $ 1,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 586 | |||||||||||||||||||
Devdatt Mishal [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||||||
Debt conversion rate | $ 0.91465 | |||||||||||||||||||
Purchase price of shares issued | $ 456,641 | |||||||||||||||||||
Reduction in related party debt | 270,300 | |||||||||||||||||||
Gain on related party debt conversion | $ 144,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 499,965 | |||||||||||||||||||
Accrued interest | $ 186,341 | |||||||||||||||||||
Lanphere Law Group [Member] | December 3 2014 [Member] | ||||||||||||||||||||
Accrued interest | $ 38,199 | |||||||||||||||||||
Debt amount | $ 74,672 | |||||||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Common stock issue for settlement | 180,397 | |||||||||||||||||||
Reduction in related party debt | $ 66,000 | |||||||||||||||||||
Common stock, shares issued | 273,700 | |||||||||||||||||||
Gain on related party debt conversion | $ 108,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 9,520 | |||||||||||||||||||
Debt amount | $ 214,334 | |||||||||||||||||||
Debt instrument principal value, after forgivness | $ 31,662 | 106,335 | ||||||||||||||||||
Due date notes payable | Dec. 2, 2015 | |||||||||||||||||||
Debt Instrument, Forgiveness | $ 108,000 | |||||||||||||||||||
Acquired additional shares of common stock | 454,097 | |||||||||||||||||||
Purchase price of additional shares of common stock | $ 66,000 | |||||||||||||||||||
Conversion price | $ 0.133 | |||||||||||||||||||
Common stock issued price per share | 0.153 | |||||||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan Three [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Purchase price of shares issued | $ 714,700 | |||||||||||||||||||
Reduction in related party debt | 714,700 | |||||||||||||||||||
Gain on related party debt conversion | $ 222,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 214,883 | |||||||||||||||||||
Lanphere Law Group [Member] | Stock Purchase Plan Two [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Purchase price of shares issued | $ 210,285 | |||||||||||||||||||
Reduction in related party debt | 169,606 | |||||||||||||||||||
Gain on related party debt conversion | $ 52,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 63,225 | |||||||||||||||||||
Accrued interest | $ 40,679 | |||||||||||||||||||
Vemon Justus [Member] | Stock Purchase Plan One [Member] | ||||||||||||||||||||
Debt conversion rate | $ 3.326 | |||||||||||||||||||
Purchase price of shares issued | $ 282,588 | |||||||||||||||||||
Reduction in related party debt | 180,001 | |||||||||||||||||||
Gain on related party debt conversion | $ 70,000 | |||||||||||||||||||
Debt conversion, converted instrument, shares issued, shares | 84,963 | |||||||||||||||||||
Accrued interest | $ 102,587 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Jun. 30, 2021 | May 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Net Related Party Notes Payable | $ 11,810 | $ 11,810 | ||
Net Long-Term Portion | $ 225,000 | $ 275,000 | ||
Related Party Notes Payable [Member] | ||||
Convertible Notes Payable with Detached Free-standing Warrants | 1,000,000 | 0 | ||
Conventional Non-Convertible Notes Payable | 11,810 | 11,810 | ||
Unamortized Debt Discount | (897,603) | 0 | ||
Net Related Party Notes Payable | 114,207 | 11,810 | ||
Current portion | (11,810) | (11,810) | ||
Net Long-Term Portion | $ 102,397 | $ 0 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) - USD ($) | Jun. 30, 2021 | May 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Net Long-Term Portion | $ 225,000 | $ 275,000 | ||
Non-Related Party Notes Payable [Member] | ||||
Convertible Notes Payable with Detached Free-standing Warrants | $ 1,005,000 | $ 0 | ||
Convertible Notes Payable | 56,683 | 56,683 | ||
Conventional Non-Convertible Notes Payable | 42,500 | 42,500 | ||
Notes Payable with Detached Free-standing Warrants | 5,000 | 5,000 | ||
Unamortized Debt Discount | (901,121) | 0 | ||
Net Non-Related Party Notes Payable | 208,062 | 104,183 | ||
Current portion | (104,183) | (79,183) | ||
Net Long-Term Portion | $ 103,879 | $ 25,000 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Dec. 07, 2020 | May 12, 2020 | Nov. 15, 2020 | Jun. 05, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | May 31, 2021 | Mar. 31, 2021 | Apr. 07, 2020 | Apr. 06, 2020 |
Proceed received from commercial bank | $ 41,665 | |||||||||||||
Interest expenses for related party notes | $ 24,904 | $ 42,161 | ||||||||||||
Loan payment, description | The loan requires interest at 1% and 18 monthly payments of principal and interest beginning December 5, 2020 | |||||||||||||
Gain on loan extinguishment | $ 42,000 | $ 0 | $ (297,711) | 86,739 | (269,144) | |||||||||
Accrued interest | $ 242 | 134,227 | 134,227 | $ 134,444 | ||||||||||
Interest expense | $ 146,028 | $ 17,397 | $ 171,906 | 65,631 | ||||||||||
Outstanding warrants | 1,002,500 | 1,002,500 | ||||||||||||
Note payable conversion price per share | $ 3 | $ 3 | $ 1.41 | $ 3.326 | ||||||||||
Non-Convertible Notes Payable Two [Member] | ||||||||||||||
Interest rate | 0.00% | |||||||||||||
Interest expense | $ 31,614 | $ 10,885 | ||||||||||||
Convertible debt, conversion, principal amount | 11,810 | |||||||||||||
Outstanding note payable | $ 11,810 | 11,810 | ||||||||||||
Related Party Convertible Notes Payable [Member] | ||||||||||||||
Gain on loan extinguishment | $ 11,697 | 61,875 | ||||||||||||
Accrued interest | $ 1,551,514 | 22,500 | ||||||||||||
Convertible notes payable principal | $ 1,485,189 | |||||||||||||
Convertible Notes Payable | $ 70,000 | 25,000 | 25,000 | |||||||||||
Convertible non-related party note payable | $ 47,500 | $ 25,000 | ||||||||||||
Convertible notes, conversion price | $ 0.50 | $ 2 | ||||||||||||
Interest rate | 10.00% | 5.00% | 10.00% | 5.00% | ||||||||||
Beneficial conversion feature debt discount | $ 1,407,675 | $ 460,215 | ||||||||||||
Interest expense | 7,689 | |||||||||||||
Outstanding warrants | 500,000 | 500,000 | ||||||||||||
Fair market value of warrants | $ 551,001 | $ 0 | ||||||||||||
Unamortized discount | $ 494,759 | 494,759 | $ 494,759 | |||||||||||
Amortization expenses, beneficial conversion feature | $ 56,242 | |||||||||||||
Stock issued during the period | 3,103,028 | 502,500 | ||||||||||||
Related Party Notes Payable [Member] | ||||||||||||||
Convertible notes payable principal | 11,810 | $ 11,810 | 11,810 | |||||||||||
Convertible Notes Payable | $ 70,000 | $ 56,683 | 56,683 | 56,683 | ||||||||||
Beneficial conversion feature debt discount | 448,999 | |||||||||||||
Interest expense | $ 55,413 | |||||||||||||
Outstanding warrants | 1,000,000 | 1,000,000 | ||||||||||||
Fair market value of warrants | $ 541,707 | $ 0 | ||||||||||||
Unamortized discount | $ 486,294 | 486,294 | ||||||||||||
Amortization expenses, beneficial conversion feature | $ 46,155 | |||||||||||||
Default interest rate | 10.00% | 12.00% | 12.00% | |||||||||||
Purchase price of shares issued | $ 12 | $ 12 | ||||||||||||
Non-Related Party Notes Payable [Member] | ||||||||||||||
Convertible notes payable principal | $ 104,183 | $ 104,183 | 79,183 | |||||||||||
Default interest rate | 12.00% | 12.00% | ||||||||||||
Purchase price of shares issued | $ 3 | $ 3 | ||||||||||||
Convertible Notes Payable with Detached Free-standing Warrants | $ 1,005,000 | $ 1,005,000 | 0 | |||||||||||
Non-Related Party Notes Payable [Member] | Minimum [Member] | ||||||||||||||
Interest rate | 5.00% | |||||||||||||
Note payable due date | 2/19/2013 | |||||||||||||
Note payable conversion price per share | $ 1.99 | $ 1.99 | ||||||||||||
Non-Related Party Notes Payable [Member] | Maximum [Member] | ||||||||||||||
Interest rate | 12.00% | |||||||||||||
Note payable due date | 3/06/2022 | |||||||||||||
Note payable conversion price per share | $ 10.7619 | $ 10.7619 | ||||||||||||
Non-Related Party Notes Payable [Member] | Non-Convertible Notes Payable [Member] | ||||||||||||||
Convertible notes payable principal | $ 42,500 | $ 42,500 | 42,500 | |||||||||||
Convertible Notes Payable | $ 5,000 | $ 5,000 | 5,000 | |||||||||||
Interest rate | 10.00% | |||||||||||||
Note payable due date | 9/11/2014 | |||||||||||||
Non-Related Party Notes Payable [Member] | Non-Convertible Notes Payable [Member] | Minimum [Member] | ||||||||||||||
Interest rate | 5.00% | |||||||||||||
Note payable due date | 12/25/2013 | |||||||||||||
Non-Related Party Notes Payable [Member] | Non-Convertible Notes Payable [Member] | Maximum [Member] | ||||||||||||||
Interest rate | 10.00% | |||||||||||||
Note payable due date | 6/06/2022 | |||||||||||||
Common Stock Purchase Plans [Member] | Six Related Parties [Member] | ||||||||||||||
Gain on loan extinguishment | $ 103,000 | 14,000 | ||||||||||||
Accrued interest | $ 82,797 | $ 63,623 | ||||||||||||
Common stock shares exchanged | 50,135 | 20,313 | ||||||||||||
Convertible notes payable principal | $ 83,953 | $ 3,938 | ||||||||||||
Reduction in related party non - convertible notes payable | $ 166,750 | $ 67,561 |
DERIVATIVE LIABILITY (Details N
DERIVATIVE LIABILITY (Details Narrative) - USD ($) | Dec. 07, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2019 |
Risk-free interest rate | 0.13% | |||||
Expected volatility rate | 180.00% | |||||
Change in fair value of derivative liability | $ 0 | $ (60,650) | ||||
Gain on loan extinguishment | $ 42,000 | $ 0 | $ (297,711) | $ 86,739 | (269,144) | |
Minimum [Member] | ||||||
Risk-free interest rate | 0.16% | |||||
Expected volatility rate | 152.00% | |||||
Maximum [Member] | ||||||
Risk-free interest rate | 0.14% | |||||
Expected volatility rate | 158.00% | |||||
Convertible promissory note agreement [Member] | ||||||
Change in fair value of derivative liability | $ 60,650 | 60,650 | ||||
Beneficial conversion feature recorded as discount | $ 64,800 | $ 64,800 | ||||
Gain on loan extinguishment | $ 273,462 | |||||
Convertible promissory note agreement [Member] | Minimum [Member] | ||||||
Expected life | 1 year | |||||
Convertible promissory note agreement [Member] | Maximum [Member] | ||||||
Expected life | 1 year | |||||
Convertible promissory note agreement [Member] | March 1, 2019 [Member] | ||||||
Fair value of embeded derivative liability | 28,000 | $ 28,000 | ||||
Convertible promissory note agreement [Member] | 2019 [Member] | ||||||
Amount borrowed under debt instrument from unrelated party | $ 70,000 | $ 70,000 | ||||
Interest rate | 10.00% | 10.00% | ||||
Conversion price, description | convertible into the Company’s common shares at a variable conversion price based on a 50% discount of the market price at an undetermined future date | |||||
Convertible promissory note agreement [Member] | May 3, 2019 [Member] | ||||||
Fair value of embeded derivative liability | $ 28,100 | $ 28,100 | ||||
Convertible promissory note agreement [Member] | October 26, 2019 [Member] | ||||||
Fair value of embeded derivative liability | $ 8,700 | $ 8,700 |
STOCK SUBSCRIPTIONS PAYABLE (De
STOCK SUBSCRIPTIONS PAYABLE (Details Narrative) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Common stock shares subscriptions, amount | $ 209,354 | $ 253,688 |
Due To Related Parties [Member] | ||
Common stock shares subscriptions, amount | $ 91,613 | $ 111,024 |
Common stock shares subscriptions, shares | 193,856 | 60,087 |
Non-Related Party Notes Payable [Member] | ||
Common stock shares subscriptions, amount | $ 117,741 | $ 117,741 |
Common stock shares subscriptions, shares | 87,500 | 87,500 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | Dec. 07, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | May 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Apr. 07, 2020 | Apr. 06, 2020 |
Common stock shares issued for services, shares | 43,169 | |||||||||
Gain on loan extinguishment | $ 42,000 | $ 0 | $ (297,711) | $ 86,739 | $ (269,144) | |||||
Debt conversion price description | values between $0.5821 to $1.039 per share | |||||||||
Settle payable balance | 137,496 | $ 137,496 | ||||||||
Additional paid in capital | $ 55,096,399 | $ 55,096,399 | $ 52,693,974 | |||||||
Debt conversion, converted instrument, shares issued | 45,268 | |||||||||
Number of warrants outstanding | 1,002,500 | 1,002,500 | ||||||||
Debt instrument, convertible, conversion price | $ 3 | $ 3 | $ 1.41 | $ 3.326 | ||||||
Lease Agreement [Member] | ||||||||||
Debt conversion, converted instrument, shares issued | 16,000 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 49,600 | |||||||||
Agreement Expiring date | February 2022 | |||||||||
Common stock shares issued for cash, shares | 16,000 | |||||||||
Convertible promissory note agreement [Member] | ||||||||||
Gain on loan extinguishment | $ 273,462 | |||||||||
Debt conversion price description | debt from $0.1530 to $0.13304 per share | |||||||||
Common stock shares issued to option exercised | 454,097 | |||||||||
Reduction in related party debt | $ 65,728 | $ 65,728 | ||||||||
Number of warrants outstanding | 454,097 | 454,097 | ||||||||
IDTEC [Member] | ||||||||||
Debt conversion, converted instrument, shares issued | 12,000,000 | |||||||||
Common stock shares issued for cash, shares | 176,938 | |||||||||
Related Party Two [Member] | ||||||||||
Additional paid in capital | $ 222,000 | $ 222,000 | ||||||||
Debt conversion, converted instrument, shares issued | 214,883 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 714,700 | |||||||||
Related Party One [Member] | ||||||||||
Gain on loan extinguishment | $ 27,000 | |||||||||
Debt conversion, converted instrument, shares issued | 38,323 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 127,000 | |||||||||
Related Party Three [Member] | ||||||||||
Gain on loan extinguishment | $ 143,660 | |||||||||
Debt conversion price description | debt from $0.9146 to $3.326 per share | |||||||||
Additional paid in capital | 124,291 | $ 124,291 | ||||||||
Debt conversion, converted instrument, shares issued | 648,739 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 622,004 | |||||||||
Series A-1 Convertible Preferred stock [Member] | ||||||||||
Common stock shares issued for services, shares | 43,169 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 107,880 | |||||||||
Non-Related Party [Member] | ||||||||||
Gain on loan extinguishment | $ 81,867 | |||||||||
Debt conversion price description | values between $0.5821 to $1.039 per share | |||||||||
Settle payable balance | $ 91,464 | $ 91,464 | ||||||||
Debt conversion, converted instrument, shares issued | 121,072 | |||||||||
Compensation for services [Member] | ||||||||||
Common stock shares issued for cash, shares | 601 | |||||||||
Non-Related Party One [Member] | ||||||||||
Gain on loan extinguishment | $ 41,665 | |||||||||
Debt conversion, converted instrument, shares issued | 70,448 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 65,391 | |||||||||
Debt instrument, convertible, conversion price | $ 3.326 | $ 3.326 |
PREFERRED STOCK (Details Narrat
PREFERRED STOCK (Details Narratve) - USD ($) | Dec. 07, 2020 | Aug. 08, 2019 | Dec. 31, 2020 | Jun. 30, 2021 | May 07, 2020 | Dec. 09, 2019 | Nov. 20, 2015 |
Accrued dividends payable | $ 107,880 | ||||||
Preferred stock, shares authorized | 19,300,000 | 19,300,000 | 25,000,000 | ||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | |||||
Series A-1 Convertible Preferred stock [Member] | |||||||
Preferred stock, shares authorized | 2,700,000 | 2,700,000 | |||||
Conversion of preferred stock shares | 2,700,000 | ||||||
Converted shares of common stock | 2,700,000 | ||||||
Preferred stock shares sold | 2,700,000 | ||||||
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 | ||||
Preferred stock, par value | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||
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 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 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 | ||||||
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 |
STOCK WARRANTS AND STOCK OPTI_3
STOCK WARRANTS AND STOCK OPTIONS (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Volatility | 180.00% | |
Risk free interest rate | 0.13% | |
Maximum [Member] | ||
Exercise Price | $ 3.38 | |
Volatility | 158.00% | |
Risk free interest rate | 0.14% | |
Minimum [Member] | ||
Exercise Price | $ 2.77 | |
Volatility | 152.00% | |
Risk free interest rate | 0.16% | |
Warrants [Member] | ||
Dividend yield | 0.00% | 0.00% |
Exercise Price | $ 3 | $ 0.50 |
Volatility | 158.00% | 153.00% |
Life of warrants | 2 years | 5 years |
Risk free interest rate | 0.29% |
STOCK WARRANTS AND STOCK OPTI_4
STOCK WARRANTS AND STOCK OPTIONS (Details 1) - Warrants [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Outstanding at beginning of period | 584,317 | 598,414 |
Warrants Granted | 1,002,500 | 320,000 |
Warrants Exercised | (176,938) | (454,097) |
Outstanding at ending of periods | 1,409,879 | 464,317 |
Warrants outstanding, Granted | $ 3 | $ 0.50 |
Warrants outstanding, Exercised | 0.50 | |
Warrants outstanding exercise price per share, end of period | 1.039375 | |
Minimum [Member] | ||
Outstanding at beginning of period | 0.50 | 0.13304 |
Warrants Exercised | 0.13304 | |
Outstanding at end of period | 0.50 | 0.50 |
Maximum [Member] | ||
Outstanding at beginning of period | 2 | 1.039375 |
Warrants Exercised | 0.15299 | |
Outstanding at end of period | $ 3 | $ 1.039375 |
Weighted Average Remaining Contractual Life | ||
Weighted Average Remaining Contractual Life , Beginning balance | 3 years 9 months 18 days | 3 years 11 months 19 days |
Weighted Average Remaining Contractual Life, Warrants granted | 1 year 9 months 14 days | 4 years 11 months 4 days |
Weighted Average Remaining Contractual Life, Ending balance | 2 years 1 month 24 days | 4 years 1 month 28 days |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Share, Beginning balance | $ 0.9413 | $ 0.3607 |
Weighted Average Exercise Price Per Share, Warrants granted | 3 | 0.50 |
Weighted Average Exercise Price Per Share, Warrants exercised | 0.50 | 0.1451 |
Weighted Average Exercise Price Per Share, ending balance | $ 2.4605 | $ 0.66765 |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Beginning balance | $ 1,173,737 | $ 1,276,870 |
Aggregate Intrinsic Value, Warrants granted | 952,375 | 768,000 |
Aggregate Intrinsic Value, Ending balance | $ 2,099,993 | $ 1,036,521 |
STOCK WARRANTS AND STOCK OPTI_5
STOCK WARRANTS AND STOCK OPTIONS (Details 2) - $ / shares | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Expected volatility | 180.00% | |
Risk free interest rate | 0.13% | |
Stock Options [Member] | ||
Expected life | 5 years | |
Expected volatility | 153.00% | |
Dividend yield | 0.00% | 0.00% |
Risk free interest rate | 0.29% | |
Weighted average exercise price per share | $ 2 | |
Maximum [Member] | ||
Exercise Price | $ 3.38 | |
Expected life | 5 years | |
Risk free interest rate | 0.34% | |
Expected volatility | 158.00% | |
Risk free interest rate | 0.14% | |
Minimum [Member] | ||
Exercise Price | $ 2.77 | |
Expected life | 2 years | |
Risk free interest rate | 0.27% | |
Expected volatility | 152.00% | |
Risk free interest rate | 0.16% |
STOCK WARRANTS AND STOCK OPTI_6
STOCK WARRANTS AND STOCK OPTIONS (Details 3) - Stock Options [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Options Outstanding Number of Shares | ||
Outstanding at beginning of period | 2,572,227 | 2,381,239 |
Option Granted | 387,500 | 140,000 |
Outstanding at ending of periods | 2,959,727 | 2,521,239 |
Option outstanding, exercisable, beginning balance | 1,253,030 | |
Option outstanding, exercisable, ending balance | 1,651,291 | |
Exercise Price Per Share | ||
Exercise Price Per Shares option granted | $ 0.26341 | $ 0.26341 |
Weighted Average Remaining Contractual Life | ||
Weighted Average Remaining Contractual Lifes beginning balance | 7 years 5 months 12 days | 8 years 10 months 9 days |
Weighted Average Remaining Contractual Lifes options granted | 2 years 11 months 8 days | 4 years 6 months 14 days |
Weighted Average Remaining Contractual Lifes ending balance | 6 years 9 months 10 days | 8 years 1 month 24 days |
Weighted Average Remaining Contractual Lifes, Exercisable, Beginning balance | 7 years 4 months 24 days | |
Weighted Average Remaining Contractual Lifes, Exercisable, Ending balance | 6 years 5 months 4 days | |
Weighted Average Exercise Price Per Share | ||
Weighted Average Exercise Price Per Shares beginning balance | $ 0.4999 | $ 0.2948 |
Weighted Average Exercise Price Per Shares options granted | 3.2854 | 1.7504 |
Weighted Average Exercise Price Per Shares ending balance | $ 0.8646 | 0.3170 |
Weighted Average Exercise Price Per Shares exercisable beginning balance | 0.3165 | |
Weighted Average Exercise Price Per Shares exercisable ending balance | $ 0.4540 | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value beginning balance | $ 6,302,277 | $ 5,238,080 |
Aggregate Intrinsic Value options granted | 257,540 | 160,732 |
Aggregate Intrinsic Value options exercised | 0 | |
Aggregate Intrinsic Value options cancelled | 0 | |
Aggregate Intrinsic Value options expired | 0 | |
Aggregate Intrinsic Value ending balance | $ 9,132,060 | 6,512,360 |
Aggregate Intrinsic Value exercisable, beginning balance | 3,299,765 | |
Aggregate Intrinsic Value exercisable ending balance | $ 5,772,880 | |
Minimum [Member] | ||
Exercise Price Per Share | ||
Exercise Price Per Shares option granted | $ 2.772 | $ 0.26341 |
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | 0.2634 | 0.2634 |
Outstanding at end of period | 0.2634 | 0.2634 |
Exercise Price Per Shares exercisable beginning balance | 0.2634 | |
Exercise Price Per Shares exercisable ending balance | 0.2634 | 0.2634 |
Maximum [Member] | ||
Exercise Price Per Share | ||
Exercise Price Per Shares option granted | 3.377 | 2 |
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | 3.377 | 1.039 |
Outstanding at end of period | 3.300 | 2 |
Exercise Price Per Shares exercisable beginning balance | 3.300 | |
Exercise Price Per Shares exercisable ending balance | $ 3.377 | $ 2 |
STOCK WARRANTS AND STOCK OPTI_7
STOCK WARRANTS AND STOCK OPTIONS (Details Narrative) - USD ($) | Jun. 05, 2020 | May 04, 2020 | Aug. 08, 2019 | Mar. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | Oct. 24, 2019 |
Number of warrants outstanding | 1,002,500 | 1,002,500 | ||||||||
Exercise price of warrants | $ 3 | $ 3 | ||||||||
Share-based compensation expense | $ 168,375 | $ 0 | $ 187,065 | $ 41,302 | ||||||
Expected lives | 2 years | |||||||||
Investor relationship service, description | 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 | |||||||||
Unrecognized compensation expense | $ 1,325,000 | |||||||||
Warrants purchased | 250,000 | |||||||||
Non Employee Stock Warrants [Member] | ||||||||||
Number of warrants outstanding | 1,409,879 | 1,409,879 | 584,317 | |||||||
Detached free-standing stock warrants granted | 1,002,500 | |||||||||
Fair value of detached free-standing stock warrants granted | $ 1,092,708 | $ 695,454 | ||||||||
2019 Equity Incentive Plans [Member] | ||||||||||
Common stock authorized shares | 2,909,422 | 2,909,422 | 3,848,467 | |||||||
Stock option vested shares | 1,600,986 | 1,600,986 | 1,202,724 | |||||||
Stock option issued | $ 939,045 | $ 939,045 | $ 1,326,546 | |||||||
Stock option non-vested shares | 1,308,436 | 1,308,436 | 1,326,546 | |||||||
8% Series A-1 Convertible Preferred Stock Investment agreement [Member] | First Capital Ventures "FCV" [Member] | ||||||||||
Number of warrants outstanding | 144,317 | 144,317 | 144,317 | |||||||
Exercise price of warrants | $ 1.039375 | |||||||||
Convertible preferred stock shares sold | 1,000,000 | |||||||||
Sale of stock price per share | $ 1 | |||||||||
Common stock shares issuable upon exercise of warrants to SPV | 144,317 | |||||||||
IDTEC [Member] | ||||||||||
Warrants purchased | 320,000 | 320,000 | ||||||||
Warrants exercise price | $ 0.50 | $ 0.50 | ||||||||
Executive Stock Options [Member] | ||||||||||
Number of warrants outstanding | 1,328,230 | 1,328,230 | 981,771 | |||||||
Executive Stock Options [Member] | Minimum [Member] | ||||||||||
Options exercisable per share | $ 0.2634 | $ 0.2634 | ||||||||
Executive Stock Options [Member] | Maximum [Member] | ||||||||||
Options exercisable per share | $ 3.38 | $ 3.38 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | Oct. 15, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 06, 2006 |
Rent expense | $ 65,197 | $ 42,348 | ||||
Contract settlement amount | $ 11,164 | |||||
Due to related party | 18,504 | $ 28,624 | ||||
Prepaid expenses with common shares | 49,600 | $ 0 | ||||
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 | $ 1,800 | |||||
Issuance of common stock | 16,000 | |||||
Rent payments, monthly | $ 6,000 | |||||
Prepaid expenses with common shares | 49,600 | |||||
California [Member] | ||||||
Contract settlement amount | $ 85,000 | |||||
Legal fees | 3,000 | |||||
Due to related party | $ 28,786 | |||||
Accrued interest | $ 53,000 |