NOTES PAYABLE | NOTE 9: NOTES PAYABLE Notes payable consists of the following: SCHEDULE OF NOTES PAYABLE June 30, 2024 December 31, 2023 Maturity Interest Rate Economic Injury Disaster Loan - originated in May 2020 $ 500,000 $ 500,000 30 3.75 % Promissory note - originated in February 2021 1,305,373 1,305,373 5 4.0 % Promissory note - originated in April 2021 (1) 676,693 676,693 1 12 % Promissory note - originated in July 2021 (1) 282,000 282,000 1 12 % Promissory note - originated in September 2021 25,803 31,758 $ 1,383.56 60 28 % Promissory note - originated in April 2022 47,633 57,577 $ 1,695.41 36 16.0 % Promissory note - originated in April 2022 - 47,392 $ 7,250 168 25 % Promissory note - originated in July 2022 36,593 43,579 $ 1,485.38 60 18 % Promissory note - originated in July 2022 45,909 67,333 $ 3,546.87 36 10 % Promissory note - originated in August 2022 18,405 20,797 $ 589.92 60 8 % Promissory note - originated in October 2022 936,532 1,081,032 $ 1,749.00 30 66 % Promissory note - originated in January 2023 3,163 4,328 $ 237.03 36 25 % Promissory note - originated in March 2023 41,624 47,570 $ 1,521.73 60 18 % Promissory note - originated in March 2023 8,707 11,754 $ 559.25 36 17 % Promissory note - originated in April 2023 21,115 24,634 $ 3,999.00 12 12 % Promissory note - originated in April 2023 23,054 33,054 $ 3,918.03 12 6 % Promissory note - originated in May 2023 (2) 122,000 322,000 3 29 % Promissory note - originated in June 2023 291,666 394,444 12 18 % Promissory note - originated in August 2023 12,879 15,895 36 14 % Promissory note - originated in December 2023 1,139,695 1,145,882 12 10 % 5,538,844 6,113,095 Less debt discount and debt issuance cost (686,183 ) (1,053,637 ) 4,842,661 5,059,458 Less current portion of promissory notes payable 3,299,271 3,704,326 Long-term promissory notes payable $ 1,553,390 $ 1,355,132 During the six months ended June 30, 2024 and 2023, we recognized interest expense of $ 668,372 630,192 367,454 479,946 During the six months ended June 30, 2024 and 2023, we issued promissory notes for a total of $- 0 1,599,772 0 1,182,344 568,064 1,047,218 Slate Advance Agreement In March 2023 we entered into an agreement (the “Slate Agreement”) with Slate Advance (“Slate”) pursuant to which we sold $ 1,482,000 975,000 40,325 14,999 In order to secure payment and performance of the Company’s obligations to Slate under the Slate Agreement, the Company granted to Slate a security interest in the following collateral: all accounts receivable and all proceeds as such term is defined by Article 9 of the UCC. We also agreed not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect to any of such collateral. We analyzed the transaction under the guidance of ASC 470-60 Troubled Debt Restructuring to determine if the transaction qualified as a troubled debt restructuring. For a debt restructuring to be considered troubled, the debtor must be experiencing financial difficulty, and the creditor must have granted a concession. We analyzed the Slate Transaction under ASC 470-60 and determined that we met one of the definitions of a company experiencing financial difficulty, such as currently in default of any of our debts. As we are not in default, the fair value of the debt has not changed, we did not recognize gain or loss as the fair value has not changed, and the future undiscounted cash flows are not greater or smaller than the carrying value, the creditor has not granted any concessions. We believe that the debt does not fall into the troubled debt restructuring guidance since no concessions were granted by the creditor. Effective June 1, 2023, the Company exchanged its convertible promissory note originally issued on December 21, 2021 in the amount of $ 555,555 665,000 a. Principal balance of $ 665,000 3 18 b. $ 115,000 c. A series of nine (9) monthly payments to the Holder in the amount of $ 38,889 d. $200,000 on the earlier of (i) three (3) business days following the Company’s successful listing (“Uplisting”) on any of the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange or (ii) the receipt of not less than $4,000,000 in funding from a single transaction (in either event an “Uplist Payment”) e. Maturity date of September 30, 2021 In addition to exchanging the original Note, Westland Properties, LLC forgave $ 4,724,299 179,782 On January 19, 2022, the Company entered into an Asset Purchase Agreement with Centurion Holdings I, LLC (“Centurion”) to acquire the intellectual property rights and certain assets collectively known as Centurion SmartShield Home and SmartShield Enterprise, patented technology that protects and recovers devices in the event of ransomware attacks. The total purchase price of $ 3,400,000 250,000 2,900,000 250,000 |