Quarterly report pursuant to Section 13 or 15(d)

COMMITMENTS AND CONTINGENCIES

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COMMITMENTS AND CONTINGENCIES
9 Months Ended
Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

The Company reached an agreement in August 2018 for the settlement of approximately $1 million in debt. Payment of approximately $0.16 million in cash and 10 million shares of common stock was made. The agreement contains a provision that upon the sale of the common stock if the original debt is not fully satisfied, full payment will be made under a mutually agreed payment plan. If the stock is sold for a gain any surplus in excess of $1.3 million shall be a credit against future purchases. The agreement was determined to meet the definition of a derivative in accordance with ASC 815. At June 30, 2020, there is a derivative financial instrument liability recorded of approximately $0.8 million related to this agreement.

 

In November 2019, the Company purchased a directors and officers’ insurance policy for approximately $241,000 and financed approximately $220,000 of the premium by executing a note payable at an interest rate of 5.6%. The balance of the note payable as of June 30, 2020, is approximately $82,000 and is included in the Notes Payable balance in the Condensed Balance Sheet.