| Schedule of Other Debt |
Schedule of Convertible Debts and Outstanding Balances
| |
|
December
31, 2022 |
|
|
December
31, 2021 |
|
| Holders |
|
Interest
Rate |
|
|
Conversion Price |
|
|
Principal |
|
|
Interest
Rate |
|
|
Conversion Price |
|
|
Principal |
|
| Main Investor |
|
|
10 |
% |
|
$ |
2.50 |
(1) |
|
$ |
9,393,150 |
|
|
|
10 |
% |
|
$ |
2.50 |
(1) |
|
$ |
9,393,150 |
|
| Others |
|
|
0
to 24 |
% |
|
$ |
2.50
or $7.50 |
(2) |
|
|
8,886,036 |
|
|
|
1
to 24 |
% |
|
$ |
2.50 |
(2) |
|
|
4,983,312 |
|
| Totals |
|
|
|
|
|
|
|
|
|
|
18,279,186 |
|
|
|
|
|
|
|
|
|
|
|
14,376,462 |
|
| Discount |
|
|
|
|
|
|
|
|
|
|
455,517 |
|
|
|
|
|
|
|
|
|
|
|
1,536,649 |
|
| Net |
|
|
|
|
|
|
|
|
|
$ |
17,823,669 |
|
|
|
|
|
|
|
|
|
|
$ |
12,839,813 |
|
Notes:
|
(1) |
Conversion
price of these note is $2.50 except for a note for $189,750, which will be adjusted
to, upon an Event of Default, the lower of (i) the conversion price or (ii) a 25% discount
to the 5-day average VWAP of the stock prior to default. |
|
(2) |
Conversion
price of these notes is $2.50 but also varies with one or more of these notes having the
following conversion adjustment: |
|
a. |
Notes
are convertible before maturity at $2.50 per share or mandatorily convertible when the Company
up-lists to the NASDAQ at the lower of $2.50 or the up-list price. |
|
b. |
Notes
are convertible upon an Event of Default at 75% multiplied by the lowest trading price for
the common stock during the five days prior to the conversion. |
|
c. |
Notes
are convertible at $2.50 per share except that following an Event of Default the conversion
price will be adjusted to 75% multiplied by the lowest trading price for the common stock
during the five days prior to the conversion. |
|
d. |
Notes
can be voluntary converted at lower of 1) $2.50/share; or 2) purchase price of stock sold
by PBI at a price lower than $2.50/share. In the event of default, these notes can be converted
at lower of 1) $2.50/share; 2) 30% discount to 5-day VWAP prior to date of default. |
|
e. |
Notes
can be voluntary converted at lower of 1) $2.50/share; or 2) purchase price of stock sold
by PBI at a price lower than $2.50/share. In the event of default, these notes can be converted
at lower of 1) $2.50/share; 2) 25% discount to 5-day VWAP prior to date of default. |
|
f. |
Conversion
price is lower of (i) $2.50 or (ii) the price per share that the Company last sold Common
Stock after the execution of an anti-dilution protection agreement. |
|
g. |
Note
can be converted at a Voluntary Conversion Price which is the lower of 1) $2.50/share; or
2) purchase price of stock sold by the Company at a price lower than $2.50 except that following
an Event of Default, the Holder shall have the right, with no further consent from the Borrower,
to convert notes which can be the lower of 1) the Voluntary Conversion Price, or 2) 70% of
the 5-day VWAP prior to conversion. |
| |
h. |
Conversion price is $2.50. If note is in default, it is $1. |
| |
i. |
Notes can be voluntarily converted before maturity at $2.50 per share.
Lender retains the option upon an Up-list to convert at the lower of $2.50 or the 10% off Up-list price. |
| |
j. |
Notes can be converted at the lesser of $2.5 per share or 25% discount
to the opening price of the Company’s first day of trading on either Nasdaq or NYSE. In addition, if the Company fails to pay the
Note in cash on maturity date, the conversion price will be adjusted to the lesser of (i) original conversion price or (ii) a 35% discount
to the VWAP prior to each conversion date. |
| |
k. |
Some notes are not convertible until 180 days from the
date of issuance of the Note and following an Event of Default will be convertible at the lowest trading price of the 20 days prior
to conversion. The loan with a principal balance of $700,000 as of December 31, 2022 is guaranteed by the Company’s Chief
Executive Officer, but the lender may only enforce this guarantee after certain conditions have been met, specifically after (i) the
occurrence of an Event of Default (as defined in the Note), (ii) the failure of the Company to cure the Default in 10 business days,
and (iii) a failure by the Company to issue, or cause to be issued, shares of its common stock upon submission by the lender of a
notice of conversion. |
| |
l. |
Some notes can be converted at the lesser of $2.50 per share or 25%
discount to the opening price of the Company’s first day of trading on either Nasdaq or NYSE. In addition, if the Company fails
to pay the Note in cash on maturity date, the conversion price will be adjusted to the lesser of original conversion price or the product
of the VWAP of the common stock for the 5 trading dates immediately prior to the maturity date multiplied by 0.75. |
| |
m. |
Some notes are not convertible until 180 days from the date of issuance of
the Note and following an Event of Default will be convertible at the lesser of $2.50 per share or 90% of the lowest trading
price over the previous 20 days. The loan is guaranteed by the Company’s Chief Executive Officer, but the lender may only enforce
this guarantee after certain conditions have been met, specifically after (i) the occurrence of an Event of Default (as defined in the
Note), (ii) the failure of the Company to cure the Default in 10 business days, and (iii) a failure by the Company to issue, or cause
to be issued, shares of its common stock upon submission by the lender of a notice of conversion. |
| |
n. |
Some notes are convertible, upon an event of default, at the lowest closing
bid price for the Company’s common stock for the five trading days prior to conversion. |
As of December
31, 2022, the approximate principal balance that are secured by the assets of the Company’s subsidiary, PBI Agrochem, Inc. is $352,188.
During the year ended December 31, 2022, the Company extended 11 loans
totaling $1,815,000 and increased the principal to $3,024,561. The Company issued 1,423,800 shares of common stock for
these extensions and added principal.
Standstill
and Forbearance Agreements
The
Company has entered into Standstill and Forbearance Agreements with lenders who hold variable-rate convertible notes with a total
principal as of December 31, 2022 of $574,984.
Pursuant to the Standstill and Forbearance Agreements, the lenders agreed to not convert any portion of their notes into shares of
common stock at a variable rate until March 31, 2021 for convertible notes with a principal balance of $469,000 and
until April 16, 2021 for convertible notes with a principal balance of $1.1 million.
During the year ended December 31, 2022, the Company settled one note with total principal of $166,703,
leaving two final lenders (four notes) with total principal of $574,984 outstanding
and incurred interest, penalties and fees of approximately $0.8 million in connection with the Standstill and Forbearance Agreement.
During the year ended December 31, 2021, the Company settled three lenders (five notes) with a total principal of
$827,500 and incurred interest, penalties, and fees of approximately $1.47 million in connection with the Standstill and forbearance
agreements.
Convertible
Loan Modifications and Extinguishments
We
refinanced certain convertible loans during the years ended December 31, 2022 and 2021 at substantially the same terms for extensions
ranging over a period of three to six months. We amortized any remaining unamortized debt discount as of the modification date over the
remaining, extended term of the new loans. We applied ASC 470 of modification accounting to the debt instruments which were modified
during the period or those settled with new notes issued concurrently for the same amounts but different maturity dates. The terms such
as the interest rate, prepayment penalties, and default rates will be the same over the new extensions. According to ASC 470, an exchange
of debt instruments between or a modification of a debt instrument by a debtor and a creditor in a nontroubled debt situation is deemed
to have been accomplished with debt instruments that are substantially different if the present value of the cash flows under the terms
of the new debt instrument is at least 10 percent different from the present value of the remaining cash flows under the terms of the
original instrument. If the terms of a debt instrument are changed or modified and the cash flow effect on a present value basis is less
than 10 percent, the debt instruments are not considered to be substantially different and will be accounted for as modifications.
The
cash flows of new debt exceeded 10% of the remaining cash flows of the original debt on several loans in 2022 and 2021. We recorded losses
on extinguishment of liabilities of $751,335 in 2022 and $1,061,073 in 2021. Our gains and losses were measured by calculating the
difference of the fair value of the new debt and the carrying value of the old debt.
Other
Debt
On October 11, 2019 we received a
non-convertible loan with a one month term and a 2% interest charge for $25,000 from a private investor. In the year
ended December 31,2021 the Company issued 17 shares of Series AA preferred stock and 17,000 warrants to acquire
common stock (five year term and $3.50 exercise price) to the investor to settle principal and interest on this
loan.
No
notes in Other Debt are past due as of December 31, 2022.
Schedule
of Other Debt
| |
|
December 31, 2022 |
|
|
December 31, 2021 |
|
| Holders |
|
Interest Rate |
|
|
Principal |
|
|
Interest Rate |
|
|
Principal |
|
| Non-Convertible |
|
|
-(1 |
) |
|
$ |
878,809 |
|
|
|
(1 |
) |
|
$ |
857,930 |
|
| Merchant debt (3) |
|
|
|
|
|
|
760,160 |
|
|
|
|
|
|
|
388,910 |
|
| SBA (2) |
|
|
3.75 |
% |
|
|
150,000 |
|
|
|
3.75 |
% |
|
|
160,000 |
|
| Totals |
|
|
|
|
|
|
1,788,969 |
|
|
|
|
|
|
$ |
1,406,840 |
|
| Long Term |
|
|
|
|
|
|
150,000 |
|
|
|
|
|
|
|
150,000 |
|
| Short Term |
|
|
|
|
|
$ |
1,638,969 |
|
|
|
|
|
|
$ |
1,256,840 |
|
Notes:
|
(1) |
Interest
varies from 1%
to 10%.
The maturity is between being past due and May
2, 2023. As of December 31, 2022, $861,500 of the non-convertible debt is past due. |
|
(2) |
The Company entered into a COVID-19 government loan in 2020, the Economic Injury Disaster Loan (or “EIDL”). The
Company’s EIDL loan, $150,000, accrues interest at 3.75% and requires monthly payments of $731 for principal and interest
beginning in December 2022. The balance of the principal will be due in 30 years. In connection with the EIDL loan the Company
entered into a security agreement with the SBA, whereby the Company granted the SBA a security interest in all of the
Company’s right, title and interest in all of the Company’s assets. During the year ended December 31, 2020, the Company
borrowed $367,039
(two-year term and 1% interest rate per annum) under Payroll Protection program (or “2020 PPP”). During the year ended
December 31, 2021, the Company borrowed $367,039 through a second Payroll Protection program (or “2021 PPP”) and
extended the monthly payment date on the EIDL to December 2022. In year 2021, both 2020 PPP and 2021 PPP was forgiven by the United States and SBA. |
| |
(3) |
During
the years ended December 31, 2022 and 2021 we signed various Merchant Agreements which are secured by second position rights to all
customer receipts until the loan has been repaid in full and subject to interest rates of 4.1%
- 14%
per month. Under the terms of these agreements, we received the disclosed Purchase Price and agreed to repay the disclosed Purchase
Amount, which is collected by the Merchant lenders at the Daily Payment Rate. We accounted for the Merchant Agreements as loans
under ASC 860 because while we provided rights to current and future receipts, we still had control over the receipts. The
difference between the Purchase Amount and the Purchase Price is imputed interest that is recorded as interest expense when paid
each day. The Company’s Chief Executive Officer guarantees the Company’s performance of all representations, warranties,
and covenants made by the Company in the Agreement. For loans outstanding on December 31, 2022, the maturity
dates ranged from April 4, 2023 to June 6, 2023. For loan outstanding on December 31, 2021, the maturity
dates ranged from January 7 to January 11, 2022.
|
|
| Schedule of Other Debt |
Schedule
of Other Debt
| |
|
December 31, 2022 |
|
|
December 31, 2021 |
|
| Holders |
|
Interest Rate |
|
|
Principal |
|
|
Interest Rate |
|
|
Principal |
|
| Non-Convertible |
|
|
-(1 |
) |
|
$ |
878,809 |
|
|
|
(1 |
) |
|
$ |
857,930 |
|
| Merchant debt (3) |
|
|
|
|
|
|
760,160 |
|
|
|
|
|
|
|
388,910 |
|
| SBA (2) |
|
|
3.75 |
% |
|
|
150,000 |
|
|
|
3.75 |
% |
|
|
160,000 |
|
| Totals |
|
|
|
|
|
|
1,788,969 |
|
|
|
|
|
|
$ |
1,406,840 |
|
| Long Term |
|
|
|
|
|
|
150,000 |
|
|
|
|
|
|
|
150,000 |
|
| Short Term |
|
|
|
|
|
$ |
1,638,969 |
|
|
|
|
|
|
$ |
1,256,840 |
|
Notes:
|
(1) |
Interest
varies from 1%
to 10%.
The maturity is between being past due and May
2, 2023. As of December 31, 2022, $861,500 of the non-convertible debt is past due. |
|
(2) |
The Company entered into a COVID-19 government loan in 2020, the Economic Injury Disaster Loan (or “EIDL”). The
Company’s EIDL loan, $150,000, accrues interest at 3.75% and requires monthly payments of $731 for principal and interest
beginning in December 2022. The balance of the principal will be due in 30 years. In connection with the EIDL loan the Company
entered into a security agreement with the SBA, whereby the Company granted the SBA a security interest in all of the
Company’s right, title and interest in all of the Company’s assets. During the year ended December 31, 2020, the Company
borrowed $367,039
(two-year term and 1% interest rate per annum) under Payroll Protection program (or “2020 PPP”). During the year ended
December 31, 2021, the Company borrowed $367,039 through a second Payroll Protection program (or “2021 PPP”) and
extended the monthly payment date on the EIDL to December 2022. In year 2021, both 2020 PPP and 2021 PPP was forgiven by the United States and SBA. |
| |
(3) |
During
the years ended December 31, 2022 and 2021 we signed various Merchant Agreements which are secured by second position rights to all
customer receipts until the loan has been repaid in full and subject to interest rates of 4.1%
- 14%
per month. Under the terms of these agreements, we received the disclosed Purchase Price and agreed to repay the disclosed Purchase
Amount, which is collected by the Merchant lenders at the Daily Payment Rate. We accounted for the Merchant Agreements as loans
under ASC 860 because while we provided rights to current and future receipts, we still had control over the receipts. The
difference between the Purchase Amount and the Purchase Price is imputed interest that is recorded as interest expense when paid
each day. The Company’s Chief Executive Officer guarantees the Company’s performance of all representations, warranties,
and covenants made by the Company in the Agreement. For loans outstanding on December 31, 2022, the maturity
dates ranged from April 4, 2023 to June 6, 2023. For loan outstanding on December 31, 2021, the maturity
dates ranged from January 7 to January 11, 2022.
|
|