NOTE 5 – LINE OF CREDIT

In connection with the Purchase Agreement of the Acquisition Companies (see Note 1) the Company assumed a $350,000 revolving line of credit (“Line of Credit”) that VS and Apex are jointly and severally liable for that expires on April 7, 2018. As of the filing date of this quarterly report the line of credit has not been repaid and is in default. The Line of Credit is guaranteed by VS, Apex and the Acquisition Companies’ previous managing member and collateralized by all of the assets of VS and Apex. The line of credit has an interest rate of prime plus 1. The interest rate was 6.24% as of March 31, 2018. For the three month period ended March 31, 2018, the company had $0 borrowings and made repayments of $4,020. The balance outstanding on the line of credit was approximately $257, 000 and $261,000 as of March 31, 2018 and December 31, 2017, respectively. As of March 31, 2018 the Company is out of compliance with the debt covenants related to the Line of Credit.