Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 20, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | PotNetwork Holdings, Inc. | |
Entity Central Index Key | 0001746563 | |
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 | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Sep. 30, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 779,836,384 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
BALANCE SHEET
BALANCE SHEET - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash/Bank Balances | $ 33,628 | $ 70,581 |
Accounts Receivable | ||
From Customers | 325,305 | |
From related parties | 0 | |
From others | 649,312 | 649,312 |
Total Accounts Receivable | 649,312 | 974,617 |
Advances - Drop Shipper | 4,717,051 | 5,070,696 |
Prepaid Expenses | 9,000 | |
Total Current assets | 5,399,991 | 6,124,893 |
TOTAL ASSETS | 5,399,991 | 6,124,893 |
Current Liabilities | ||
Payables | 1,199,770 | 1,673,501 |
Current portion of Notes Payable, convertible | 319,161 | 358,949 |
Total Current Liabilities | 1,518,930 | 2,032,450 |
Long-term Liabilities | ||
Loan from 3rd Party with interest | 26,412 | 32,000 |
Notes Payable | 4,036,182 | 3,842,550 |
PPP Loan from SBA | 135,404 | 0 |
EIDL loan from SBA | 159,900 | 0 |
Total long-term liabilities | 4,357,898 | 3,874,550 |
Total Liabilities | 5,876,828 | 5,907,000 |
Stockholders' Equity | ||
Common: Authorized 1,500,000,000 shares, $ .00001 par value; and 779,836,384 Issued and outstanding as of September 30, 2020 and 700,836,384 shares issued and outstanding as of December 31, 2019 | 4,185,656 | 3,995,840 |
Additional Paid-in Capital | 1,626,589 | 1,626,589 |
Retained Earnings | (6,289,482) | (5,404,935) |
Total Stockholders' Equity | (476,837) | 217,893 |
Total Liabilities & Equity | 5,399,991 | 6,124,893 |
Preferred Stock Class A Authorized - 50,000 shares, $ .00001 Par value; and 34,289 Issued and outstanding, as of September 30, 2020 and 34,289 issued and outstanding as of December 31, 2019 | $ 400 | $ 400 |
BALANCE SHEET (Parenthetical)
BALANCE SHEET (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Stockholders' Equity | ||
Common stock, shares par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued | 779,836,384 | 700,836,384 |
Common stock, shares outstanding | 779,836,384 | 700,836,384 |
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 50,000 | 50,000 |
Preferred stock, shares issued | 34,289 | 34,289 |
Preferred stock, shares outstanding | 34,289 | 34,289 |
INCOME STATEMENT
INCOME STATEMENT - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue | ||||
Sales | $ 2,486,678 | $ 3,629,621 | $ 7,476,938 | $ 14,157,742 |
Cost of goods sold | 1,682,902 | 2,181,802 | 4,655,274 | 8,557,686 |
Gross profit | 803,776 | 1,447,819 | 2,821,664 | 5,600,056 |
Operating expenses | ||||
Research and development | 0 | 0 | 0 | 0 |
Sales & Marketing | 743,209 | 1,695,562 | 2,422,382 | 5,108,343 |
General & Administrative Expenses | 437,242 | 172,461 | 927,757 | 627,756 |
Total operating expenses | 1,180,451 | 1,868,023 | 3,350,139 | 5,736,099 |
Financing expenses | ||||
Interest Exp | 90,122 | 84,764 | 356,072 | 247,982 |
Total financing expenses | 90,122 | 84,764 | 356,072 | 247,982 |
Total Expenses | 1,270,573 | 1,952,787 | 3,706,211 | 5,984,081 |
Profit (Loss) before Income Tax | (466,797) | (504,968) | (884,546) | (384,025) |
Provision for Income Tax | 0 | 0 | 0 | 0 |
Net Profit (Loss) | $ (466,797) | $ (504,968) | $ (884,546) | $ (384,025) |
Earnings per share | ||||
Basic and diluted | $ (0.000599) | $ (0.000721) | $ (0.001134) | $ (0.000548) |
Basic and diluted weighted average common shares outstanding | 779,836,384 | 700,836,384 | 779,836,384 | 700,836,384 |
CASH FLOWS STATEMENT
CASH FLOWS STATEMENT - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
CASH FLOWS STATEMENT | ||||
Net Income (Loss) | $ (466,797) | $ (504,968) | $ (884,546) | $ (384,025) |
Adjustments to reconcile net income (loss) | ||||
Accounts Receivable from customers | 43,847 | 55,860 | ||
Accounts Receivable from others | 751,810 | (500,000) | 353,644 | (500,000) |
Other Assets | 54,401 | 570,696 | 334,305 | (1,189,851) |
Payable | (427,074) | 75,682 | (473,731) | (356,963) |
Total Adjustments to reconcile net income (loss) | 379,137 | 190,224 | 214,218 | (1,990,953) |
Net cash from the current year operations | (87,660) | (314,744) | (670,328) | (2,374,978) |
Investing | ||||
Common Stock | 97,296 | 9,875 | 189,816 | 396,025 |
Preferred A Stock | 0 | 0 | ||
Net cash provided by investing activities | 97,296 | 9,875 | 189,816 | 396,025 |
Financing | ||||
Third Party Loan | (14,636) | 640 | (13,356) | 1,920 |
PPP Loan from SBA | 159,900 | |||
EIDL Loan from SBA | 135,404 | |||
Notes Payable | 1,962 | 268,332 | 161,612 | 1,461,082 |
Net cash provided by financing activities | (12,674) | 268,972 | 443,560 | 1,463,002 |
Net change in cash and cash equivalents | (3,038) | (35,896) | (36,953) | (515,950) |
Cash and cash equivalents, beginning of period | 36,666 | 104,372 | 70,581 | 584,426 |
Cash and cash equivalents, end of period | $ 33,628 | $ 68,476 | $ 33,628 | $ 68,476 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY - USD ($) | Total | Preferred Shares [Member] | Common Shares [Member] | Surplus (Deficit) |
Balance, shares at Dec. 31, 2017 | 39,839 | 569,920,485 | ||
Balance, amount at Dec. 31, 2017 | $ (1,828,766) | $ 400 | $ 450,573 | $ (2,279,739) |
Shares Issued, shares | 215,444,227 | |||
Shares Issued, amount | 2,718,467 | $ 2,718,467 | ||
Shares Cancelled, shares | (216,000,000) | |||
Shares Cancelled, amount | (2,323,469) | |||
Net Profit (Loss) | 242,634 | 242,634 | ||
Balance, shares at Dec. 31, 2018 | 39,839 | 569,364,712 | ||
Balance, amount at Dec. 31, 2018 | 1,132,335 | $ 400 | $ 3,169,040 | (2,037,105) |
Shares Issued, shares | 131,471,672 | |||
Shares Issued, amount | 826,800 | $ 826,800 | ||
Net Profit (Loss) | (3,367,831) | (3,367,831) | ||
Addl Paid-in Capital | 1,626,589 | 1,626,589 | ||
Balance, shares at Dec. 31, 2019 | 34,289 | 700,836,384 | ||
Balance, amount at Dec. 31, 2019 | 217,893 | $ 400 | $ 3,995,840 | (3,778,347) |
Shares Issued, shares | 79,000,000 | |||
Shares Issued, amount | 189,816 | $ 189,816 | ||
Net Profit (Loss) | (884,546) | (884,546) | ||
Balance, shares at Sep. 30, 2020 | 39,839 | 779,836,384 | ||
Balance, amount at Sep. 30, 2020 | $ (476,837) | $ 400 | $ 4,185,656 | $ (4,662,893) |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 9 Months Ended |
Sep. 30, 2020 | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | |
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS | PotNetwork Holdings, Inc. is a publicly traded holding company trading under the symbol “POTN”. The Company website is www.potnetworkholding.com. The Company has two (2) wholly-owned subsidiaries: (1) First Capital Venture Co., a Florida corporation which has as its wholly-owned subsidiary, Diamond CBD, Inc., a Delaware corporation. First Capital Venture Co. was acquired by the Company on January 31, 2017. (2) PotNetwork Media Group, Inc., a Nevada corporation Since the acquisition of First Capital Venture Co., the focus of the Company has been the development of the business of Diamond CBD, Inc. PotNetwork Media Group, Inc. is an early stage company. Any other subsidiaries are dormant having ceased operations. Hence, the financial statements reflect principally the business results of Diamond CBD business. Diamond CBD, Inc. focuses on the research, development, and multinational marketing of premium hemp extracts that contain a broad range of cannabinoids and natural hemp derivatives. Diamond CBD’s catalog can be found in http://catalog.diamondcbd.com. Since the acquisition of First Capital Venture Co. and Diamond CBD on January 31, 2017, Diamond CBD’s business has become the primary business of this Company. Diamond CBD is treated as a wholly owned subsidiary of the Company and the accounts of the subsidiary are presented in the Company’s consolidated statements eliminating inter-company transactions. In accordance with ASC 805-40-45 the consolidated financial statements represent the continuation of the financial statements of the wholly owned subsidiary except for its capital structure. The Company, being the legal acquirer, but the accounting acquirer, did not have significant assets or revenues prior to the consolidation. Investment in the wholly owned subsidiary is accounted for in accordance with ASC 810. In February 2018, the Company reversed ab initio the March 17, 2017 holding company reorganization. As a result, the Company re-assumed its prior name, PotNetwork Holdings, Inc. (with an “s” on Holding), while remaining a Colorado corporation. None of the acquisitions or the share capital structure was affected. In February 2018, the shares issued pursuant to the reorganization were cancelled, no other adjustments had been made. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ➢ BASIS OF PRESENTATIONS ➢ USE OF ESTIMATES ➢ REVENUE RECOGNITION - DIAMOND CBD BUSINESS The Company applies the five-step model of revenue recognition under ASC 606 to the sales orders in the e-commerce platform. The following describes the Company’s process per each step (1-5) of ASC606: Step 1: “Identify the contract with a customer”. A. The company’s ecommerce website is making the offer to the customer. B. The customer chooses the product(s) and quantities of each. C. The customer enters its credit card information. D. The contract between the company and the customer is concluded when the authorization is taken vis-a-vis the merchant account which processes the credit card payment. Step 2: “Identify the performance obligations in the contract”. The company ships the merchandise and subsequently records the customer payment Step 3: “Determine the transaction price”. The website states each product’s regular price, and applicable sale price which is the amount that the customer pays the company. Step 4: “Allocate the transaction price to the performance obligations in the contract”. The company’s e-commerce platform applies any quantity discount or other discount offered by the Company, automatically. Step 5: “Recognize revenue when the entity satisfies a performance obligation”. The Company records the sale upon the order’s shipping, identified by a tracking number. ➢ CASH AND CASH EQUIVALENTS: ➢ ACCOUNTS RECEIVABLE: ➢ ASSESSMENT OF COLLECTABILITY: 1. Receivables supervisor is authorized to collect delinquent accounts 2. The Treasurer has the authority to assign accounts to a third party for collection 3. Recording of Accounts Receivable: All amounts due on physical delivery of the merchandise from the drop-shipper, must be promptly recorded as an accounts receivable. Each account receivable must be recorded and maintained until payment is received or the recorded amount is written off or extinguished. 4. An adequate provision for doubtful accounts must be established. When all reasonable efforts fail to collect an account receivable and it has been approved for write off, the related provision for doubtful accounts should be reduced. 5. Control and Subsidiary Accounts: The accounting system incorporates control accounts, where applicable, to ensure the completeness and accuracy of individual accounts. The Receivables supervisor must maintain subsidiary accounts for individual debtors in a manner that discloses, at a given point in time, the aggregate amount owed by each debtor as well as individual amounts making up the aggregate amount. Monthly, the subsidiary accounts for each accounts receivable must be reconciled with the control account. 6. Checks that are returned from the bank as non-negotiable are assessed a returned cheque charge. If there are 2 cheques returned from the same customer within a month, no further cheques will be accepted from the customer unless the cheques are certified, until there is an acceptable payment history for a further one-year period. 7. Statements to Debtors: Statements must be issued to debtors, on a monthly basis, providing meaningful and concise information on the status of their debts. Accounts receivable are considered overdue when a debtor does not pay or resolve the debt within 30 days from the invoice date or a written request for payment to the debtor. 8. All actions taken to collect overdue accounts must be documented. 9. If there is no response after the initial contact at the 30-day point (within a 30-day period - 60 days from date of invoice), accounts will be forwarded to Treasury Staff to take prompt and vigorous action to collect overdue accounts receivable. 10. Accounts receivable, in most cases, should be at least 30 days overdue (i.e., 60 days after invoice notification), before staff advises debtors that their accounts are overdue and that the accounts may be: i. Turned over to a private collection agency; ii. subject to legal action iii. Credit privileges will be revoked; and/or account may be suspended. ➢ PREPAID EXPENSES: ➢ PROPERTY AND EQUIPMENT: Property and equipment are stated at the written-down value [that is, after deducting depreciation from the cost]. This Company adapted the depreciation rates as provided in IRS publications, using the Modified Accelerated Cost Recovery System (MACRS). Computers and office equipment are considered as 5-year property. Office furniture and fixtures are 7-year property in MACRS and apply the 200% declining balance method over a GDS recovery period. Wherever possible, section 179 depreciation is also applied. However, the accumulated depreciation shall not exceed the actual cost at any point of time. As on the date of the financial statements, the Company does not hold any assets. ➢ INTANGIBLE ASSETS 1) Initial Measurement: Intangible asset acquisitions in which the consideration given is cash are measured by the amount of cash paid, which generally includes the transaction costs of the asset acquisition. However, if the consideration given is not in the form of cash (that is, in the form of non-cash assets, liabilities incurred, or equity interests issued), measurement is based on either the cost which shall be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is clearer and, thus, more reliably measurable 2) Subsequent Measurement: The Company accounts for its intangible assets under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Subtopic (“ASC”) 350-30-35 “Intangibles-- Goodwill and Other--General Intangibles Other than Goodwill-Subsequent Measurement”. Under this method the Company is required to test an indefinite-lived intangible asset for impairment on at least an annual basis. This is done by comparing the asset’s fair value with its carrying amount. If the carrying amount exceeds the asset’s fair value, the difference in those amounts is recognized as an impairment loss. ➢ FINANCIAL INSTRUMENTS The carrying amounts reported in the balance sheets for current liabilities qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of valuation hierarchy are defined as follows: Level 1 Level 2 Level 3 ASC 350 requires capitalizing any money spent on product development and product improvement. During the current year, money spent on product development is very little and is not significant. ➢ Investments in subsidiaries: ➢ Redemption Right: |
GOING CONCERN
GOING CONCERN | 9 Months Ended |
Sep. 30, 2020 | |
GOING CONCERN | |
NOTE 3 - GOING CONCERN | The financial statements are prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. Since PotNetwork Holdings, Inc. has no uncertainties as on the balance sheet date, the financial statements need no adjustments. Since Diamond CBD’s business originated in 2015, it is considered as a business with limited operating history. Hence, this business is subject to all risks inherent in a developing business enterprise. Continued success depends on the problems, difficulties, complications, and delays frequently encountered in the competitive and regulatory environment in which it operates. Since the CBD business is a burgeoning industry, there are no established entities whose business model Diamond CBD can follow or build upon. Regulatory risk: Hemp-based CBD is often confused with marijuana-based CBD which remains illegal under federal Law; although the Company maintains that its products are legal. Yet, this legal risk cannot be ignored. Although Diamond CBD does not sell any marijuana-based CBD products, its products could be treated as being illegal by federal/state authorities and by consumers. The Company is involved in a highly competitive industry where it may compete with numerous other companies who offer alternative methods or approaches, who may have far greater resources, more experience, and personnel perhaps more qualified than the Company does. Such resources, experience and personnel may provide a substantial competitive advantage to the competition. |
DEFERRED TAX COMPUTATION
DEFERRED TAX COMPUTATION | 9 Months Ended |
Sep. 30, 2020 | |
DEFERRED TAX COMPUTATION | |
NOTE 4 - DEFERRED TAX COMPUTATION | The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes”. Under this method, income tax expense is recognized for: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all the deferred tax assets will not be realized. ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented. There was no income tax expense during this quarter. However, the availability of a net operating loss carryforward and the associated deduction, is subject to complex and restrictive federal income tax provisions as codified by Internal Revenue Code section 172 and related Treasury Regulations, all of which are subject to change and the availability of which can never be free from doubt. The components of the deferred tax assets and liabilities are as follows: Deferred tax assets: September 30, 2020 December 31, 2019 Net operating loss carryovers $ 6,289,482 $ 5,404,935 Stock-based compensation - - Other temporary differences - - Total deferred tax assets $ 6,289,482 5,404,935 Valuation allowance (6,289,482 ) (5,404,935 ) Net deferred tax asset $ - $ - |
INVENTORY DIAMOND CBD
INVENTORY DIAMOND CBD | 9 Months Ended |
Sep. 30, 2020 | |
INVENTORY DIAMOND CBD | |
NOTE 5 - INVENTORY DIAMOND CBD | This Company has arranged to buy the exact quantity from the suppliers, based on the customer orders and thereby has eliminated the need for holding inventory on hand at any point of time. Otherwise, this Company values the inventory at the lower of cost or market. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 6 - COMMITMENTS AND CONTINGENCIES | There are no commitments and contingencies that exist at present, other than the legal disputes mentioned supra. |
BUDGET INTERNAL CONTROL PROCEDU
BUDGET INTERNAL CONTROL PROCEDURES | 9 Months Ended |
Sep. 30, 2020 | |
BUDGET INTERNAL CONTROL PROCEDURES | |
NOTE 7 - BUDGET & INTERNAL CONTROL PROCEDURES | 1) Internal control procedures for inventory and cash control are being developed and implemented on an ongoing basis to ensure higher levels of performances. 2) Annual financial budget is reviewed by the Board of Directors. 3) Quarterly variance reports are reviewed by the Board of Directors. |
CAPITAL STOCK
CAPITAL STOCK | 9 Months Ended |
Sep. 30, 2020 | |
CAPITAL STOCK | |
NOTE 8 - CAPITAL STOCK | Common Stock Class A Preferred Stock - |
Loan from Kabbage
Loan from Kabbage | 9 Months Ended |
Sep. 30, 2020 | |
Loan from Kabbage | |
NOTE 9 - Loan from Kabbage | Company received a new loan on 1/9/2020 amounting $100,000 from Kabbage. Monthly payments are made on 2/29/2020, 3/27/2020,4/27/2020,5/27/2020 and 6/27/2020.The payment of $10,833.34 includes interest portion Date Beginning Interest Payment Ending 2/27/2020 $ 100,000.00 $ 2,500.00 $ 10,833.34 $ 91,666.66 3/27/2020 $ 91,666.66 $ 2,500.00 $ 10,833.34 $ 83,333.32 4/27/2020 $ 83,333.32 $ 2,500.00 $ 10,833.34 $ 74,999.98 5/27/2020 $ 74,999.98 $ 2,500.00 $ 10,833.34 $ 66,666.64 6/27/2020 $ 66,666.64 $ 2,500.00 $ 10,833.34 $ 58,333.30 7/27/2020 $ 58,333.30 $ 2,500.00 $ 10,833.34 $ 49,999.90 8/27/2020 $ 49,999.90 $ 2,500.00 $ 10,833.34 $ 41,666.50 9/27/2020 $ 41,666.50 $ 2,500.00 $ 10,833.34 $ 33,333.10 |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2020 | |
NOTES PAYABLE | |
NOTE 10 - NOTES PAYABLE | Payee: SBA On June 18, 2020 this Company received $159,900 from the SBA as the Economic Injury Disaster Loan which is repayable with 1% interest for staying in the business during the pandemic. On May 5, 2020 this Company received from the SBA, the sum of $135,404 as part of the Paycheck Protection Program, which is a grant and not re-payable, provided the lending bank certifies the forgiveness within this calendar year. Payee: Sign N Drive Principal Value: $1,850,000 Issue date: June 2, 2014, amended March 10, 2017 Terms: Interest Free, Fixed Conversion Rate at $.003 per share Embedded Conversion Option: Given the fixed rate conversion price, no derivative liability calculation for the conversion option was deemed required. There is no maturity date for this note. Year Interest Waived 2017 $ 7,318 2018 $ 4,351 2019 $ 4,770 2020 $ 4,831 The following table sets forth the number of shares of common stock issued pursuant to each conversion under the Note: Dates Quantity of shares Conversion price Amount converted August 13, 2014 161,127,812 0.00032 $ 51,561 April 4, 2016 2,750,000 0.004 11,000 August 2, 2016 4,500,000 0.0012 5,400 November 8, 2016 2,500,000 0.00152 3,800 December 22, 2016 10,000,000 0.00088 8,800 July 5, 2017 42,000,000 0.003 126,000 September 27, 2017 40,000,000 0.003 120,000 February 2, 2018 25,000,000 0.003 75,000 May 29, 2018 25,000,000 0.003 75,000 June 5, 2018 25,000,000 0.003 75,000 December 4, 2018 1,550,000 0.003 4,650 December 14, 2018 6,000,000 0.003 18,000 December 20, 2018 12,333,334 0.003 37,000 April 17, 2019 46,050,000 0.003 138,150 June 26, 2019 26,000,000 0.003 78,000 February 2,2020 27,000,000 0.003 92,520 August 20, 2020 24,000,000 0.003 82,248 Per the above table: $246,000 was converted into common stock in 2017; $284,650 was converted into common stock in 2018; $216,150 was converted into common stock in 2019; $174,768 was converted into common stock in 2020. Payee: Iliad Research & Trading LP On October 25, 2018, the Company issued a Note in the face amount of $5,525,000 which accrues interest at the rate of 10% per annum. The note has an Original Issue Discount (OID) of $500,000. The Note and any interest thereon is convertible at a fixed rate of $0.45 per share of common stock or after 12 months, at a variable conversion rate, the “redemption conversion price” at the lower of the fixed rate of $.45 per share, or a discount to the market price as defined in the Note. The Note is comprised of five (5) tranches (each, a “Tranche”), consisting of (i) an Initial Tranche in an amount equal to $1,400,000.00 and any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents (as defined in the Purchase Agreement) (the ‘‘Initial Tranche”), and (ii) four (4) additional Tranches, one (l) in the amount of $1,375,000.00, one (l) in the amount of $550,000.00, and two (2) in the amount of $1,100,000.00, plus any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents. $1,400,000 was received on 10/31/2018 $825,000 was received on 12/18/2018 $18,410 is the accrued interest for 2018 On February 8, 2019, the Company issued a Note in the face amount of $3,325,000 which accrues interest at the rate of 10% per annum. The note has an Original Issue Discount (OID) of $300,000. The Note and any interest thereon is convertible at a fixed rate of $0.45 per share of common stock or after 12 months, at a variable conversion rate, the “redemption conversion price” at the lower of the fixed rate of $.45 per share, or a discount to the market price as defined in the Note. The Note is comprised of three (3) tranches (each, a “Tranche”), consisting of (i) an Initial Tranche in an amount equal to $1,125,000.00 and any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents (as defined in the Purchase Agreement) (the ‘‘Initial Tranche”), and (ii) two (2) additional Tranches, one (l) in the amount of $500,000.00, and one (1) in the amount of $1,650,000.00, plus any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents. $1,125,000 was received on 2/17/2019 $77,794 is the accrued interest through 3/31/19 $84,144 is the accrued interest from 4/1/2019 to 6/30/2019 $169,641 is the accrued interest from 7/1/2019 to 12/31/19 $415,557 is the accrued interest from 1/1/2020 to 3/31/2020 $83,979 is the accrued interest from 4/1/2020 to 6/30/2020 $84,210 is the accrued interest from 6/30/2020 to 9/30/2020 On June 16, 2020, the Board of Directors approved the Company’s subsidiary, First Capital Venture, entering into a Disaster Relief Loan from the US Small Business Administration in the amount of $150,000. The loan is secured by a security interest in all the assets of First Capital Venture and is for working capital purposes. |
Management Assertions Regarding
Management Assertions Regarding Current Legal Proceedings | 9 Months Ended |
Sep. 30, 2020 | |
Management Assertions Regarding Current Legal Proceedings | |
NOTE 11 - Management Assertions Regarding Current Legal Proceedings | First Capital Venture Co. VS T1 Payments, LLC In addition to the above, Company is involved in the following legal proceedings, each of which is specific to each plaintiff suing the Company based upon the convertibility of a promissory note. In each case the Company is contesting the validity of the request for conversion of shares pursuant to each such note (each referred to as a “Note”). The following are the case references to each case filed by each of the plaintiffs (collectively, the “Plaintiffs”): • Mammoth West Corporation v PotNetwork Holdings Inc., Case No. 17 CH 778, 19th Circuit Court of Lake County, IL. Filed May 26, 2017. • Southridge Partners II Limited Partnership vs. SND Auto Group, Inc., Case No. 3:17-cv-01925 US District Court for the District of Connecticut, filed January 5, 2018. • J. P. Carey Limited Partners, L.P. v. PotNetwork Holdings, Inc., Case No.3:18-CV-00873-WWE, US District Court for the District of Connecticut, filed May 24, 2018. Each Plaintiff filed a civil complaint with regard to their rights to convert a specific convertible promissory Note. In each case, the Note was issued not by the Company, but by its predecessor issuer, SND Auto Company Inc. (which predecessor issuer had changed its name before changing it back to SND Auto Group, Inc.). Each Note was issued by SND Auto Company Inc., respectively on June 13, 2016 to Mammoth West Corporation and on July 18, 2016 to Southridge Partners II Limited Partnership, for money paid to SND Auto Company Inc., at a time when SND Auto Company Inc. was the public entity, with sole operations in the automotive industry. (Plaintiff, J. P. Carey Limited Partners, L.P., on March 1, 2018, was a subsequent purchaser of a portion of the Southridge Partners II Limited Partnership Note and conversion rights connected to the amount purchased, which it then attempted to convert on the pre-reorganization terms and conditions of the Note, as more fully defined below.) Subsequent to the issuance of the Notes, on March 14, 2017, SND Auto Company Inc. engaged in a holding company reorganization whereby SND Auto Company Inc., became a subsidiary of the public entity. The holding company reorganization was an express condition of a private company, First Capital Venture Holdings Co., whose acquisition was the principal reason for the reorganization. Each Plaintiff has sought to convert into shares of the post reorganization Company, at a conversion price of a fraction of a penny per share, based on SND Auto Group, Inc.’s share price prior to the reorganization. The Company disputed the conversion amounts presented by the Plaintiffs The relief sought by each Plaintiff in each case is as follows: • Mammoth West Corporation: Issuance of the shares per each of its conversion notices per the original terms of its Note, reasonable attorneys’ fees and reimbursement of court costs, and such other and further relief as the court deems appropriate. • Southridge Partners II Limited Partnership: Damages of at least $743,150, interest, punitive damages, a mandatory injunction seeking specific performance, reasonable attorneys’ fees and reimbursement of court costs, and such other and further relief as the court deems appropriate. • J. P. Carey Limited Partners, L.P.; Damages of at least $573,890, interest, punitive damages, a mandatory injunction seeking specific performance, reasonable attorneys’ fees and reimbursement of court costs, and such other and further relief as the court deems appropriate. On August 17, 2020, JP Carey Limited Partners L.P. and the Company came to a settlement, whereby the Company agreed to issue 28 million shares of the Company’s common stock to JP Carey, subject to certain leak out provisions. The case has subsequently been dismissed. On August 27, 2020, the Court dismissed the case brought by Southridge Partners II Limited Partnership for failing to obtain counsel to prosecute the case after the Court’s order to do so. Southridge may seek to refile its claim. On October 22, 2020, the Company entered into a settlement agreement with Mammoth Corporation which is subject to a fairness hearing scheduled for November 20, 2020. Potter v. PotNetwork Holdings, Inc., Diamond CBD, Inc., and First Capital Venture Co., Plaintiff Potter alleged that she purchased certain products from Diamond CBD that contained levels of CBD that were less than the amount stated on the packaging and south class action status. The Company and its subsidiaries settled the matter at mediation on July 14, 2020. The parties completed the final documentation of the settlement and the case was dismissed on August 27, 2020. Pursuant to the settlement agreement the Company agreed to issue a $10 voucher to purported class members, pay the named plaintiff $5,000 and pay the law firms that brought the suit $200,000 in legal fees to be paid over 30 months, secured by a pledge of shares of the Company’s common stock. |
CERTAIN RELATIONSHIPS AND RELAT
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR INDEPENDENCE | 9 Months Ended |
Sep. 30, 2020 | |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR INDEPENDENCE | |
NOTE 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR INDEPENDENCE, | Related Party Transactions During the fiscal year 2019, Distribution Wholesale, Inc, a Florida Corporation, of which Kevin Hagen, CEO and President, advanced to the company $1,626,588.64 (the Advances) in the form of payments to several suppliers. On December 31, 2019, on the settlement of the debt created by the Advances, the board of Directors of the company issued a common stock Purchase Warrant, exercisable over 5 years, for 75,305,030 shares of common stock of the company at a price per share of $0.0216 to the Distribution Wholesale, Inc. Consequently, the advances have been recorded as additional paid in capital on the Balance sheet of the company as of March 31, 2020. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 13 - SUBSEQUENT EVENTS | We have evaluated events subsequent to the period ended September 30, 3030 through November 17, 2020. On October 1, 2020, the Company issued 8,854,782 common shares to a note holder upon the conversion of $75,000 of indebtedness owed. The common stock issued in the transaction were issued pursuant to the exemption for registration contained in Section 4(a)(2) of the Securities Act of 1933. As reported on Form 8-K on October 27, 2020, on October 22, 2020 Kevin Hagen resigned as Chief Executive Officer, President and a director of PotNetwork Holdings, Inc. (the “Company”). Mr. Hagen will retain his position as President of First Capital Venture Co., a subsidiary of the Company. Mr. Hagen’s resignation was not the result any disagreement with the Board of Directors of the Registrant with respect to its operations, policies or practices. He continues to be a significant shareholder of the Registrant. On October 22, 2020, Lee Lefkowitz was appointed as Chief Executive Officer, President and a director of the Company. At this time, the Company has not entered into an employment agreement with Mr. Lefkowitz. Lee Lefkowitz, age 50, CEO, President, Director. For much of his career Mr. Lefkowitz has been a serial entrepreneur owning and operating his own businesses. Most recently he has invested in and co-founded All Natural Way Corp. and B2H LLC, companies operating in areas of CBD business that POTN does not. He also was an early investor in several other startup companies. Prior to 2015 he worked as an accountant, focusing on both domestic and international corporate accounts. Mr. Lefkowitz, in addition, has considerable experience managing multi-faceted accounting functions, and in the private sector has overseen and administered an over $10 million annual budget. He holds a BA in Psychology for the State University of New York as well as an AAS in Business Administration. On November 1, 2020, Murugan Venkat, Chief Financial Officer of the Company resigned due to other business commitments. As a result, Mr. Lefkowitz, CEO, assumed the responsibilities of the Chief Financial Officer position. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATIONS | The statements were prepared following generally accepted accounting principles of the United States of America which were consistently applied. |
USE OF ESTIMATES | Management uses estimates and assumptions in preparing these financial statements in accordance with U.S. generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. |
REVENUE RECOGNITION DIAMOND CBD BUSINESS | Revenue from the sale of goods is measured at fair value of the consideration received or receivable and is recognized in the statement of comprehensive income of the Company when significant risks and rewards of the ownership of the goods have been transferred to the buyers. The Company applies the five-step model of revenue recognition under ASC 606 to the sales orders in the e-commerce platform. The following describes the Company’s process per each step (1-5) of ASC606: Step 1: “Identify the contract with a customer”. A. The company’s ecommerce website is making the offer to the customer. B. The customer chooses the product(s) and quantities of each. C. The customer enters its credit card information. D. The contract between the company and the customer is concluded when the authorization is taken vis-a-vis the merchant account which processes the credit card payment. Step 2: “Identify the performance obligations in the contract”. The company ships the merchandise and subsequently records the customer payment Step 3: “Determine the transaction price”. The website states each product’s regular price, and applicable sale price which is the amount that the customer pays the company. Step 4: “Allocate the transaction price to the performance obligations in the contract”. The company’s e-commerce platform applies any quantity discount or other discount offered by the Company, automatically. Step 5: “Recognize revenue when the entity satisfies a performance obligation”. The Company records the sale upon the order’s shipping, identified by a tracking number. |
CASH AND CASH EQUIVALENTS | Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition and the balance cash in hand and the balance in bank accounts. |
ACCOUNTS RECEIVABLE | Accounts Receivable (AR) is the payment which the Company will receive from its customers who have purchased its goods & services in the last month of the year and on credit terms. Usually the credit period is short, approximately a few days. |
ASSESSMENT OF COLLECTABILITY | 1. Receivables supervisor is authorized to collect delinquent accounts 2. The Treasurer has the authority to assign accounts to a third party for collection 3. Recording of Accounts Receivable: All amounts due on physical delivery of the merchandise from the drop-shipper, must be promptly recorded as an accounts receivable. Each account receivable must be recorded and maintained until payment is received or the recorded amount is written off or extinguished. 4. An adequate provision for doubtful accounts must be established. When all reasonable efforts fail to collect an account receivable and it has been approved for write off, the related provision for doubtful accounts should be reduced. 5. Control and Subsidiary Accounts: The accounting system incorporates control accounts, where applicable, to ensure the completeness and accuracy of individual accounts. The Receivables supervisor must maintain subsidiary accounts for individual debtors in a manner that discloses, at a given point in time, the aggregate amount owed by each debtor as well as individual amounts making up the aggregate amount. Monthly, the subsidiary accounts for each accounts receivable must be reconciled with the control account. 6. Checks that are returned from the bank as non-negotiable are assessed a returned cheque charge. If there are 2 cheques returned from the same customer within a month, no further cheques will be accepted from the customer unless the cheques are certified, until there is an acceptable payment history for a further one-year period. 7. Statements to Debtors: Statements must be issued to debtors, on a monthly basis, providing meaningful and concise information on the status of their debts. Accounts receivable are considered overdue when a debtor does not pay or resolve the debt within 30 days from the invoice date or a written request for payment to the debtor. 8. All actions taken to collect overdue accounts must be documented. 9. If there is no response after the initial contact at the 30-day point (within a 30-day period - 60 days from date of invoice), accounts will be forwarded to Treasury Staff to take prompt and vigorous action to collect overdue accounts receivable. 10. Accounts receivable, in most cases, should be at least 30 days overdue (i.e., 60 days after invoice notification), before staff advises debtors that their accounts are overdue and that the accounts may be: i. Turned over to a private collection agency; ii. subject to legal action iii. Credit privileges will be revoked; and/or account may be suspended. |
PREPAID EXPENSES | Prepaid expenses are future expenses that have been paid in advance. In other words, prepaid expenses are costs that have been paid but are not yet used up or have not yet expired. The company’s prepaid expenses is mostly advance payment to the drop shipper. |
PROPERTY AND EQUIPMENT | As on the date of the financial statements, the Company does not hold any assets. Property and equipment are stated at the written-down value [that is, after deducting depreciation from the cost]. This Company adapted the depreciation rates as provided in IRS publications, using the Modified Accelerated Cost Recovery System (MACRS). Computers and office equipment are considered as 5-year property. Office furniture and fixtures are 7-year property in MACRS and apply the 200% declining balance method over a GDS recovery period. Wherever possible, section 179 depreciation is also applied. However, the accumulated depreciation shall not exceed the actual cost at any point of time. As on the date of the financial statements, the Company does not hold any assets. |
INTANGIBLE ASSETS | 1) Initial Measurement: Intangible asset acquisitions in which the consideration given is cash are measured by the amount of cash paid, which generally includes the transaction costs of the asset acquisition. However, if the consideration given is not in the form of cash (that is, in the form of non-cash assets, liabilities incurred, or equity interests issued), measurement is based on either the cost which shall be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is clearer and, thus, more reliably measurable 2) Subsequent Measurement: The Company accounts for its intangible assets under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Subtopic (“ASC”) 350-30-35 “Intangibles-- Goodwill and Other--General Intangibles Other than Goodwill-Subsequent Measurement”. Under this method the Company is required to test an indefinite-lived intangible asset for impairment on at least an annual basis. This is done by comparing the asset’s fair value with its carrying amount. If the carrying amount exceeds the asset’s fair value, the difference in those amounts is recognized as an impairment loss. |
FINANCIAL INSTRUMENTS | For certain of the Company’s financial instruments, including cash, accrued expenses and short-term debt, the carrying amounts approximate their fair values due to their short maturities. We adopted ASC Topic 820, “Fair Value Measurements and Disclosures”, which requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, “Financial Instruments,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for current liabilities qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of valuation hierarchy are defined as follows: Level 1 Level 2 Level 3 ASC 350 requires capitalizing any money spent on product development and product improvement. During the current year, money spent on product development is very little and is not significant. |
Investments in subsidiaries | The March 17, 2017 reorganization is referred as holding Company reorganization. The Company did not make any payment in cash or check in connection with the reorganization. First Capital Venture Co., the parent of Diamond CBD, Inc. is now the wholly owned subsidiary. The entire amount of current year profit is attributable to the business generated by this wholly owned subsidiary. As required under ASC 810, consolidated accounts are presented in this financial statement. |
Redemption Right | In 2017, the Company signed convertible promissory notes for $1,200,000. The convertible notes have a redemption right, which reads as, “Notwithstanding any provision contained herein to the contrary including the conversion rights as set forth in this section, the Company shall be entitled, at any time prior to the expiration of five days from any notice of conversion, to repay this Note in full, plus interest, minus the credit accorded from prior payments, including from prior conversions, and avoid any further Note conversion and thus avoid the issuance of any additional shares of PotNetwork Holdings, Inc.” By this clause, no derivative liability exists. Further, these convertible promissory notes are exchanged for Common Stock Purchase Warrant, as mentioned supra. |
DEFERRED TAX COMPUTATION (Table
DEFERRED TAX COMPUTATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
DEFERRED TAX COMPUTATION | |
Schedule Of Deferred Tax Asset And Liabilities | Deferred tax assets: September 30, 2020 December 31, 2019 Net operating loss carryovers $ 6,289,482 $ 5,404,935 Stock-based compensation - - Other temporary differences - - Total deferred tax assets $ 6,289,482 5,404,935 Valuation allowance (6,289,482 ) (5,404,935 ) Net deferred tax asset $ - $ - |
Loan from Kabbage (Tables)
Loan from Kabbage (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Loan from Kabbage | |
Schedule of Loan | Date Beginning Interest Payment Ending 2/27/2020 $ 100,000.00 $ 2,500.00 $ 10,833.34 $ 91,666.66 3/27/2020 $ 91,666.66 $ 2,500.00 $ 10,833.34 $ 83,333.32 4/27/2020 $ 83,333.32 $ 2,500.00 $ 10,833.34 $ 74,999.98 5/27/2020 $ 74,999.98 $ 2,500.00 $ 10,833.34 $ 66,666.64 6/27/2020 $ 66,666.64 $ 2,500.00 $ 10,833.34 $ 58,333.30 7/27/2020 $ 58,333.30 $ 2,500.00 $ 10,833.34 $ 49,999.90 8/27/2020 $ 49,999.90 $ 2,500.00 $ 10,833.34 $ 41,666.50 9/27/2020 $ 41,666.50 $ 2,500.00 $ 10,833.34 $ 33,333.10 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
NOTES PAYABLE | |
Schedule of interest waived | Year Interest Waived 2017 $7,318 2018 $4,351 2019 $4,770 2020 $4,831 |
Schedule of conversion of notes in common Stock | Dates Quantity of shares Conversion price Amount converted August 13, 2014 161,127,812 0.00032 $51,561 April 4, 2016 2,750,000 0.004 11,000 August 2, 2016 4,500,000 0.0012 5,400 November 8, 2016 2,500,000 0.00152 3,800 December 22, 2016 10,000,000 0.00088 8,800 July 5, 2017 42,000,000 0.003 126,000 September 27, 2017 40,000,000 0.003 120,000 February 2, 2018 25,000,000 0.003 75,000 May 29, 2018 25,000,000 0.003 75,000 June 5, 2018 25,000,000 0.003 75,000 December 4, 2018 1,550,000 0.003 4,650 December 14, 2018 6,000,000 0.003 18,000 December 20, 2018 12,333,334 0.003 37,000 April 17, 2019 46,050,000 0.003 138,150 June 26, 2019 26,000,000 0.003 78,000 February 2,2020 27,000,000 0.003 92,520 August 20, 2020 24,000,000 0.003 82,248 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Redemption Right [Member] | |
Convertible promissory notes | $ 1,200,000 |
Property and Equipment [Member] | |
Depreciation rate | 200.00% |
Office furniture and fixtures [Member] | |
Property plant and equipment useful life | 7 years |
Computers and office equipment [Member] | |
Property plant and equipment useful life | 5 years |
DEFERRED TAX COMPUTATION (Detai
DEFERRED TAX COMPUTATION (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryovers | $ 6,289,482 | $ 5,404,935 |
Stock-based compensation | 0 | 0 |
Other temporary differences | 0 | 0 |
Total deferred tax assets | 6,289,482 | 5,404,935 |
Valuation allowance | (6,289,482) | (5,404,935) |
Net deferred tax asset | $ 0 | $ 0 |
CAPITAL STOCK (Details Narrativ
CAPITAL STOCK (Details Narrative) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
CAPITAL STOCK | ||
Common stock shares, authorized | 1,500,000,000 | 1,500,000,000 |
Common stock shares, par value | $ 0.00001 | $ 0.00001 |
Common stock shares, issued | 779,836,384 | 700,836,384 |
Common stock shares, outstanding | 779,836,384 | 700,836,384 |
Preferred stock shares, authorized | 50,000 | 50,000 |
Preferred stock shares, par value | $ 0.00001 | $ 0.00001 |
Preferred stock shares, issued | 34,289 | 34,289 |
Preferred stock shares, outstanding | 34,289 | 34,289 |
Loan from Kabbage (Details)
Loan from Kabbage (Details) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
9/27/2020 [Member] | |
Beginning | $ 41,667 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 33,333 |
8/27/2020 [Member] | |
Beginning | 50,000 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 41,667 |
7/27/2020 [Member] | |
Beginning | 58,333 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 50,000 |
6/27/2020 [Member] | |
Beginning | 66,667 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 58,333 |
5/27/2020 [Member] | |
Beginning | 75,000 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 66,667 |
4/27/2020 [Member] | |
Beginning | 83,333 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 75,000 |
3/27/2020 [Member] | |
Beginning | 91,667 |
Interest | 2,500 |
Payment | 10,833 |
Ending | 83,333 |
2/27/2020 [Member] | |
Beginning | 100,000 |
Interest | 2,500 |
Payment | 10,833 |
Ending | $ 91,667 |
CERTAIN RELATIONSHIPS AND REL_2
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR INDEPENDENCE, (Details Narrative) - Kevin Hagen [Member] | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Due to related party | $ | $ 1,626,589 |
Common stock warrants issued as compensation | shares | 75,305,030 |
Warrants exercisable period | 5 years |
Exercisable price | $ / shares | $ 0.0216 |
Loan from Kabbage (Details Narr
Loan from Kabbage (Details Narrative) - Kabbage [Member] | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Payment of loan, Description | Monthly payments are made on 2/29/2020, 3/27/2020,4/27/2020,5/27/2020 and 6/27/2020 |
Proceeds from loan | $ 100,000 |
Monthly payments of loan | $ 10,833 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
NOTES PAYABLE | ||||
Interest Waived | $ 4,831 | $ 4,770 | $ 4,351 | $ 7,318 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) | 9 Months Ended |
Sep. 30, 2020USD ($)$ / sharesshares | |
August 20, 2020 [Member] | |
Amount Converted | $ | $ 82,248 |
Quantity of Shares | shares | 24,000,000 |
Conversion Price | $ / shares | $ 0.003 |
February 2, 2020 [Member] | |
Amount Converted | $ | $ 92,520 |
Quantity of Shares | shares | 27,000,000 |
Conversion Price | $ / shares | $ 0.003 |
May 29, 2018 [Member] | |
Amount Converted | $ | $ 75,000 |
Quantity of Shares | shares | 25,000,000 |
Conversion Price | $ / shares | $ 0.003 |
June 5, 2018 [Member] | |
Amount Converted | $ | $ 75,000 |
Quantity of Shares | shares | 25,000,000 |
Conversion Price | $ / shares | $ 0.003 |
December 4, 2018 [Member] | |
Amount Converted | $ | $ 4,650 |
Quantity of Shares | shares | 1,550,000 |
Conversion Price | $ / shares | $ 0.003 |
December 14, 2018 [Member] | |
Amount Converted | $ | $ 18,000 |
Quantity of Shares | shares | 6,000,000 |
Conversion Price | $ / shares | $ 0.003 |
December 20, 2018 [Member] | |
Amount Converted | $ | $ 37,000 |
Quantity of Shares | shares | 12,333,334 |
Conversion Price | $ / shares | $ 0.003 |
April 17, 2019 [Member] | |
Amount Converted | $ | $ 138,150 |
Quantity of Shares | shares | 46,050,000 |
Conversion Price | $ / shares | $ 0.003 |
June 26, 2019 [Member] | |
Amount Converted | $ | $ 78,000 |
Quantity of Shares | shares | 26,000,000 |
Conversion Price | $ / shares | $ 0.003 |
December 22, 2016 [Member] | |
Amount Converted | $ | $ 8,800 |
Quantity of Shares | shares | 10,000,000 |
Conversion Price | $ / shares | $ 0.00088 |
July 5, 2017 [Member] | |
Amount Converted | $ | $ 126,000 |
Quantity of Shares | shares | 42,000,000 |
Conversion Price | $ / shares | $ 0.003 |
September 27, 2017 [Member] | |
Amount Converted | $ | $ 120,000 |
Quantity of Shares | shares | 40,000,000 |
Conversion Price | $ / shares | $ 0.003 |
February 2, 2018 [Member] | |
Amount Converted | $ | $ 75,000 |
Quantity of Shares | shares | 25,000,000 |
Conversion Price | $ / shares | $ 0.003 |
November 8, 2016 [Member] | |
Amount Converted | $ | $ 3,800 |
Quantity of Shares | shares | 2,500,000 |
Conversion Price | $ / shares | $ 0.00152 |
August 13, 2014 [Member] | |
Amount Converted | $ | $ 51,561 |
Quantity of Shares | shares | 161,127,812 |
Conversion Price | $ / shares | $ 0.00032 |
August 2, 2016 [Member] | |
Amount Converted | $ | $ 5,400 |
Quantity of Shares | shares | 4,500,000 |
Conversion Price | $ / shares | $ 0.0012 |
April 4, 2016 [Member] | |
Amount Converted | $ | $ 11,000 |
Quantity of Shares | shares | 2,750,000 |
Conversion Price | $ / shares | $ 0.004 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | May 05, 2020 | Feb. 08, 2019 | Jun. 18, 2020 | Feb. 17, 2019 | Dec. 18, 2018 | Oct. 31, 2018 | Oct. 25, 2018 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2020 | Jun. 16, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 |
Converted into common stock | $ 174,768 | $ 216,150 | $ 284,650 | $ 246,000 | ||||||||||||
Amount received | $ 135,404 | $ 159,900 | $ 1,125,000 | $ 825,000 | $ 1,400,000 | |||||||||||
Tranche One [Member] | ||||||||||||||||
Accrued interest charges fees and costs | $ 1,125,000 | $ 1,400,000 | ||||||||||||||
Tranche Two [Member] | ||||||||||||||||
Accrued interest charges fees and costs | 500,000 | 1,375,000 | ||||||||||||||
Tranche Three [Member] | ||||||||||||||||
Accrued interest charges fees and costs | 1,650,000 | 550,000 | ||||||||||||||
Tranche Four [Member] | ||||||||||||||||
Accrued interest charges fees and costs | 1,100,000 | |||||||||||||||
Disaster Relief Loan [Member] | ||||||||||||||||
Loan approved | $ 150,000 | |||||||||||||||
Illiad Research & Trading LP [Member] | ||||||||||||||||
Face amount | $ 3,325,000 | $ 5,525,000 | ||||||||||||||
Fixed conversion rate | $ 0.45 | $ 0.45 | ||||||||||||||
Accrues interest | 10.00% | 10.00% | ||||||||||||||
Original issue discount | $ 300,000 | $ 500,000 | ||||||||||||||
Accrued interest | $ 84,210 | $ 169,641 | $ 18,410 | $ 83,979 | $ 415,557 | $ 84,144 | $ 77,794 | |||||||||
Sign N Drive Auto Mall, Inc. [Member] | ||||||||||||||||
Fixed conversion rate | $ .003 | |||||||||||||||
Principal value | $ 1,850,000 |
Management Assertions Regardi_2
Management Assertions Regarding Current Legal Proceedings (Details Narrative) - USD ($) | 9 Months Ended | |||
Sep. 30, 2020 | Aug. 17, 2020 | Apr. 22, 2020 | Dec. 31, 2017 | |
Settlement, Descriptions | Pursuant to the settlement agreement the Company agreed to issue a $10 voucher to purported class members, pay the named plaintiff $5,000 and pay the law firms that brought the suit $200,000 in legal fees | |||
Southridge Partners II Limited [Member ] | SND Auto Group, Inc [Member ] | ||||
Owed amount | $ 743,150 | |||
JP Carey Limited Partners [Member] | ||||
Shares issued upon settlement | 28,000,000 | |||
Interest payable | $ 573,890 | |||
First Capital Venture Co. [Member] | ||||
Return amount of lawsuit | $ 649,312 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - USD ($) | Oct. 22, 2020 | Oct. 01, 2020 |
Note Holder [Member] | ||
Debt conversion, converted shares, indebtedness owed | 8,854,782 | |
Debt conversion, converted amount, indebtedness owed | $ 75,000 | |
Lefkowitz [Member] | ||
Annual budget | $ 10,000,000 |