Annual report pursuant to Section 13 and 15(d)


12 Months Ended
Dec. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value Disclosures [Text Block]


The Company adopted the provisions of Accounting Standards Codification subtopic 825-10, Financial Instruments (“ASC 825-10”). ASC 825-10 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. ASC 825-10 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825-10 establishes three levels of inputs that may be used to measure fair value:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

All items required to be recorded or measured on a recurring basis are based upon level 3 inputs.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed and is determined based on the lowest level input that is significant to the fair value measurement.

The carrying value of the Company’s cash and cash equivalents, accounts payable and other current assets and liabilities approximate fair value because of their short-term maturity.

As of December 31,2019, and 2018, the Company did not have any items that would be classified as level 1, 2 or 3 disclosures.

As of December 31, 2019, and 2018, the Company did not have any derivative instruments that were designated as hedges.

There were no derivative and warrant liability as of December 31, 2019 and 2018.

The following table provides a summary of changes in fair value of the Company’s level 3 financial liabilities as of December 31, 2019:







Balance, January 1, 2018

  $ 2,358,240     $ 685,922  

Total (gains) losses


Transfers out due to the adoption of ASU 2017-11 effective January 1, 2018





Balance, December 31, 2018 and 2019

  $ -     $ -