Thanks I did !!!as well as others via tweet . Clue-so @Magnum7419 · 9m How is $OZSC fundiing the 100,000 first of four payments to PCTI. I hope not thru convertible debt.
In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak was largely concentrated in China and caused significant disruptions to its economy, it has now spread to most other countries and infections have been reported globally. Because COVID-19 infections have been reported throughout the United States, certain federal, state and local governmental authorities have issued stay-at-home orders, proclamations and/or directives aimed at minimizing the spread of COVID-19. The ultimate impact of the COVID-19 pandemic on the Company’s operations is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that governments, or the Company, may direct, which may result in an extended period of continued business disruption, and reduced operations. Any resulting financial impact cannot be reasonably estimated at this time but it may have a material adverse impact on our business, financial condition and results of operations. Management expects that its business will be impacted to some degree, but the significance of the impact of the COVID-19 outbreak on the Company’s business and the duration for which it may have an impact cannot be determined at this time.
From January 1, 2020, through the date of this report the Company has issued 243,562,612 shares of common stock upon the conversion of $1,168,383 of principal and $195,437 of accrued interest and fees of convertible notes. The Company also issued 13,244,492 shares of common stock upon the exercise of warrants.
On January 16, 2020, the Company received via email from SRI notice that the Agreement dated August 23, 2019, between SRI and the Company has been revoked, as the Company did not make the required January 6, 2020, license payment nor cure the default. Based on the termination of the Agreement, the Company recorded an impairment charge to goodwill of $274,854 as of December 31, 2019. The impairment charge was calculated as the difference of the carrying values of the assets acquired compared to the consideration and liabilities assumed in the transaction as follows:
Assets Inventory $ 378,061 Instruments, net 353,985 Patent rights, net 2,724,848 Goodwill 2,277,168 Total assets as of December 31, 2019 $ 5,734,062
Consideration issued and liabilities assumed Common Stock payable $ 245,000 License fee payable 1,234,089 Equity Line payable 45,359 Iberia Note 447,153 Inventory and Instrument note 595,379 Option to buy 2,892,228 Total consideration and liabilities assumed balances $ 5,459,208 Impairment recorded December 31, 2019 $ 274,854
F-27
On January 8, 2020, the Company entered into a securities purchase agreement (the “SPA”) with an investor (the “Investor”), pursuant to which the Company agreed to issue to the Investor a 12% Convertible Promissory Note, (the “Note”) in the principal amount of $38,000 in exchange for a purchase price of $35,000. The Note was funded by the Investor on January 13, 2020, and on such date pursuant to the SPA, the Company reimbursed the Investor for expenses for legal fees and due diligence of $3,000. The Note proceeds will be used by the Company for general working capital purposes. The SPA includes customary representations, warranties and covenants by the Company and customary closing conditions.
On February 4, 2020, the Company filed an Amended and Restated Certificate of Designation with the State of Nevada of the Company’s Series C Preferred Stock (the “Preferred Stock”). The voting rights associated with the Preferred Stock were amended whereby each share of Preferred Stock shall entitle the holder thereof to have voting rights equal to two times the sum of all the number of shares of other classes of Company capital stock eligible to vote on all matters submitted to a vote of the stockholders of the Company, divided by the number of shares of Preferred Stock issued and outstanding at the time of voting.
On February 7, 2020, the Financial Industry Regulatory Authority (“FINRA”) announced the Company’s 1:1,000 reverse stock split of the Company’s common stock. The reverse stock split took effect on February 10, 2020. The Company filed a Certificate of Amendment – Certificate to Accompany Amended and Restated Articles of Incorporation with the State of Nevada, adding a paragraph to registrant’s Articles of Incorporation to effect the reverse stock split.
On February 26, 2020, the Company entered into a securities purchase agreement (the “SPA”) with an investor (the “Investor”), pursuant to which the Company agreed to issue to the Investor a 12% secured convertible promissory note (the “Note”) in the aggregate principal amount of $132,750 in exchange for a purchase price of $117,750. Pursuant to the SPA, the Company agreed to pay the Investor $15,000 to cover the Investor’s due diligence expenses incurred in connection with the SPA and Note, which is to be offset against the proceeds of the Note. The Note was funded by the Investor on February 26, 2020, and on such date pursuant to the SPA, the Company reimbursed the Investor for expenses for legal fees and due diligence of $2,750. The Note proceeds will be used by the Company for general working capital purposes. The SPA includes customary representations, warranties and covenants by the Company and customary closing conditions. The proceeds will be used by the Company for general corporate purposes. The SPA includes customary representations, warranties and covenants by the Company and customary closing conditions.
On February 28, 2020, the Company entered into a Binding Letter of Intent (the “LOI”) with Power Conversion Technologies, Inc., a Pennsylvania corporation (“PCTI”), and Catherine Chis (“Chis”), PCTI’s Chief Executive Officer (“CEO”) and its sole shareholder. Pursuant to the terms of the LOI, the Company will acquire 100% of the issued and outstanding shares of PCTI (the “PCTI Shares”) from Chis (the “Acquisition”). PCTI operates in the very high power niche of the power electronics market, designing and manufacturing leading edge equipment for use in power conversion applications. PCTI serves clients in several industries including energy storage, shore power, DEWs, microgrid, telecommunications, military, transportation, renewable energy, aerospace and mission critical defense systems. PCTI’s clients include Fortune 500 companies, all branches of the US Department of Defense including the US Army and the US Air Force, NASA as well as other global military organizations. The Company believes the Acquisition will close by June 30, 2020, and is in the best interests of the Company and its’ shareholders. In conjunction with the LOI, Michael Chermak and Barry Hollander resigned as Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), respectively, and Brian Conway was named CEO and Interim CFO. Also, on February 28, 2020, in connection with entering into the LOI, the Company agreed to purchase and redeem 50,000 shares of the Company’s Series C Preferred Stock from Mr. Chermak for a total purchase price of $100,000 pursuant to a Redemption Agreement (the “Redemption Agreement”) requiring aggregate redemption payments of $100,000, of which $50,000 was paid upon the signing of the Redemption Agreement and $50,000 was paid on April 28, 2020, On April 28 2020 Mr. Conway was appointed to the Board of the Company, and Mr. Chermak resigned from the Board. Mr. Conway is the sole officer and director of the Company.
On February 28, 2020, the Company and Mr. Conway entered into an employment agreement (the “Employment Agreement”). Pursuant to the terms of the Employment Agreement, Mr. Conway is to receive an annual salary of $120,000, for his position of CEO of the Company, payable monthly.
F-28
On March 9, 2020, (the “Issuance Date”) the Company issued a 12% convertible promissory note, (the “Note”) in the principal amount of $80,000, to an investor. The Note matures 6 months after the Issuance Date. The Note is convertible into shares of the Company’s common stock beginning on the Issuance Date at $.25 for the first three months after the Issuance Date. After the first three months after the Issuance Date, the conversion price shall be equal to the lower of (i) $.25 or 50% of the lowest trading price for the thirty trading days prior to the conversion.
On April 28, 2020, the Company issued a 12% convertible promissory note, (the “Note”) in the principal amount of $53,000, pursuant to a Securities Purchase Agreement we entered into with an investor. The Note matures 12 months after the date of issuance. The Note is convertible into shares of the Company’s common stock beginning on the date which is 180 days from the issuance date of the Note, at a conversion price equal to 58% multiplied by the lowest closing bid price during the 20- trading day period ending on the last completed trading date in the OTC Markets prior to the date of conversion.
On May 4, 2020, the Company issued a 12% convertible promissory note, (the “Note”) in the principal amount of $110,000, pursuant to a Securities Purchase Agreement we entered into with an investor. The Note matures 12 months after the date of issuance. The Note is convertible into shares of the Company’s common stock beginning on the date which is 180 days from the issuance date of the Note, at a conversion price equal to the lower of $0.50 or 58% multiplied by the average of the two lowest closing trading price or bid price during the 20- trading day period ending on the last completed trading date in the OTC Markets prior to the date of conversion.
The Company has evaluated subsequent events through the date the financial statements were issued. The Company has determined that there are no other such events that warrant disclosure or recognition in the financial statements, except as stated herein.
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