Item 1.01. Entry Into a Material Definitive Agreement
Advanced Voice Recognition Systems, Inc., a Nevada corporation (“AVRS”, “we” or “us”), previously reported in its Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission on November 14, 2017 that it had received notice that Meyers & Associates, LLC, a Colorado limited liability company (“M&A”), filed Complaint number 2017CV32482 in Arapahoe County District Court in the State of Colorado on October 30, 2017 against AVRS and Walter Geldenhuys, who is the President, Chief Executive Officer and Chief Financial Officer of AVRS. The Complaint relates to legal fees that AVRS purportedly owed M&A.
On January 31, 2018, AVRS, Mr. Geldenhuys and M&A entered into a Settlement Agreement pursuant to which the parties mutually agreed to release certain specified claims and AVRS and Mr. Geldenhuys agreed to deliver a promissory note to M&A in the original principal amount of $52,385.46 (the “Promissory Note”), which accrues interest at the rate of 12% compounded annually. Pursuant to the terms of the Promissory Note, AVRS and Mr. Geldenhuys are jointly and severally obligated to pay M&A one thousand dollars ($1,000) per month on the first day of each month beginning February 1, 2018 and continuing through July 1, 2018, and to pay all remaining unpaid principal and accrued interest on August 1, 2018.
On August 1, 2018 AVRS and M&A entered into an Agreement to Amend Promissory Note. AVRS shall pay $6,000 on or before August 1, 2018, shall pay $1,500 on the first day of each month beginning September 1, 2018 and continuing through November 1, 2018 and shall pay all remaining unpaid principal and accrued interest on December 1, 2018. Copy of the Agreement To Amend Promissory Note is furnished herewith as exhibit 10.1 and incorporated herein by reference.
On December 10, 2018 AVRS and M&A entered into a second Agreement to Amend Promissory Note. M&A agreed to further amend certain provisions of the Note on the condition that Maker make a balloon payment on the obligation under the Promissory Note, as amended by the Agreement to Amend Promissory Note in the amount of $20,000 (US) on or before November 21, 2018.
Maker shall pay one thousand five hundred dollars ($1,500) on the first day of the month beginning January 1, 2019 and continuing through June 1, 2019 and shall pay all remaining unpaid principal and accrued interest on or before July 1, 2019. Copy of the Agreement To Amend Promissory Note is furnished herewith as exhibit 10.1 and incorporated herein by reference.