Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | May 15, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | CORRELATE INFRASTRUCTURE PARTNERS INC. | |
Entity Central Index Key | 0001108645 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Mar. 31, 2023 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2023 | |
Entity Common Stock Shares Outstanding | 35,350,571 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-55825 | |
Entity Incorporation State Country Code | NV | |
Entity Tax Identification Number | 84-4250492 | |
Entity Interactive Data Current | Yes | |
Entity Address Address Line 1 | 220 Travis Street | |
Entity Address Address Line 2 | Suite 501 | |
Entity Address City Or Town | Shreveport | |
Entity Address State Or Province | LA | |
Entity Address Postal Zip Code | 71101 | |
City Area Code | 855 | |
Local Phone Number | 264-4060 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash | $ 741,405 | $ 96,308 |
Contract assets | 342,649 | 684,185 |
Prepaid expenses and other current assets | 564,783 | 395,953 |
Total current assets | 1,648,837 | 1,176,446 |
Property and equipment | ||
Property and equipment, net | 3,604 | 4,004 |
Total property and equipment | 3,604 | 4,004 |
Other assets | ||
Intangible assets - customer relationships, net | 175,350 | 187,040 |
Intangible assets - developed technology, net | 10,400 | 13,870 |
Intangible assets - development rights, net | 102,796 | 112,744 |
Goodwill | 762,851 | 762,851 |
Total other assets | 1,051,397 | 1,076,505 |
Total assets | 2,703,838 | 2,256,955 |
Current liabilities | ||
Accounts payable | 1,049,872 | 1,069,743 |
Accrued expenses | 963,579 | 1,285,898 |
Shareholder advances | 96,519 | 96,519 |
Line of credit | 30,000 | 30,000 |
Notes payable, current portion, net of discount | 932,664 | 1,513,546 |
Convertible notes payable, current portion, net of discount | 126,888 | 0 |
Derivative liability | 5,357,570 | 722,328 |
Total current liabilities | 8,557,092 | 4,718,034 |
Notes payable, net of current portion and discount | 31,251 | 344,595 |
Total liabilities | 8,588,343 | 5,062,629 |
Stockholders' equity (deficit) | ||
Preferred stock $.0001 par value; authorized 50,000,000 shares with -0- issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 0 | 0 |
Common stock $0.0001 par value; authorized 400,000,000 shares with 35,350,571 and 35,323,626 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 3,535 | 3,532 |
Additional paid-in capital | 5,790,739 | 5,459,220 |
Accumulated deficit | (11,678,779) | (8,268,426) |
Total stockholders' equity (deficit) | (5,884,505) | (2,805,674) |
Total liabilities and stockholders' equity (deficit) | $ 2,703,838 | $ 2,256,955 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 400,000,000 | 400,000,000 |
Common Stock, Shares, Issued | 35,350,571 | 35,323,626 |
Common Stock, Shares, Outstanding | 35,350,571 | 35,323,626 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 50,734 | $ 68,408 |
Cost of revenues | 45,859 | 69,114 |
Gross profit (loss) | 4,875 | (706) |
Operating expenses | ||
General and administrative | 1,023,930 | 546,234 |
Insurance | 2,230 | 1,171 |
Legal and professional | 120,225 | 182,008 |
Travel | 36,255 | 28,955 |
Depreciation and amortization | 25,508 | 15,160 |
Total operating expenses | 1,208,148 | 773,528 |
Loss from operations | (1,203,273) | (774,234) |
Other income (expense) | ||
Interest expense | (97,353) | (32,741) |
Amortization of debt discount | (788,282) | (166,485) |
Financing costs | (3,808,565) | 0 |
Change in fair value of derivative liability | 2,487,120 | 0 |
Total other income (expense) | (2,207,080) | (199,226) |
Net loss | $ (3,410,353) | $ (973,460) |
Loss per share | $ (0.10) | $ (0.03) |
Weighted average shares outstanding - basic | 35,332,384 | 35,159,920 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) - USD ($) | Total | Common Class B [Member] | Common Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Common Class A [Member] |
Balance, shares at Dec. 31, 2021 | 34,639,920 | |||||
Balance, amount at Dec. 31, 2021 | $ 432,420 | $ 0 | $ 0 | $ 1,534,474 | $ (1,105,518) | $ 3,464 |
Issuance of warrants in connection with debt | 799,128 | 0 | 0 | 799,128 | 0 | 0 |
Stock-based compensation | 150,504 | 0 | 0 | 150,504 | 0 | $ 0 |
Issuance of shares for cash, shares | 600,000 | |||||
Issuance of shares for cash, amount | 150,000 | 0 | 0 | 149,940 | 0 | $ 60 |
Net loss | (973,460) | 0 | 0 | 0 | (973,460) | $ 0 |
Settlement of derivative liability | 0 | |||||
Balance, shares at Mar. 31, 2022 | 35,239,920 | |||||
Balance, amount at Mar. 31, 2022 | 558,592 | 0 | $ 0 | 2,634,046 | (2,078,978) | $ 3,524 |
Balance, shares at Dec. 31, 2022 | 35,323,626 | |||||
Balance, amount at Dec. 31, 2022 | (2,805,674) | 0 | $ 3,532 | 5,459,220 | (8,268,426) | 0 |
Stock-based compensation | 253,851 | 0 | 0 | 253,851 | 0 | 0 |
Net loss | (3,410,353) | 0 | $ 0 | 0 | (3,410,353) | 0 |
Issuance of shares for services, shares | 17,045 | |||||
Issuance of shares for services, amount | 15,000 | 0 | $ 2 | 14,998 | 0 | 0 |
Issuance of shares for financing costs, shares | 4,245 | |||||
Issuance of shares for financing costs, amount | 4,500 | 0 | $ 0 | 4,500 | 0 | 0 |
Issuance of shares for the payment of accrued interest, shares | 5,655 | |||||
Issuance of shares for the payment of accrued interest, amount | 7,589 | 0 | $ 1 | 7,588 | 0 | 0 |
Settlement of derivative liability | 50,582 | $ 0 | $ 0 | 50,582 | 0 | 0 |
Balance, shares at Mar. 31, 2023 | 35,350,571 | |||||
Balance, amount at Mar. 31, 2023 | $ (5,884,505) | $ 3,535 | $ 5,790,739 | $ (11,678,779) | $ 0 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities | ||
Net loss | $ (3,410,353) | $ (973,460) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 25,508 | 15,160 |
Amortization of debt discount | 788,282 | 166,485 |
Stock issued for services | 15,000 | 0 |
Stock-based compensation | 253,851 | 150,504 |
Financing costs | 3,808,565 | 0 |
Change in fair value of derivative liability | (2,487,120) | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 0 | (51,180) |
Contract assets | 341,536 | 0 |
Prepaid expenses and other current assets | (168,830) | (11,000) |
Accounts payable | (19,871) | (75,080) |
Accrued expenses | (235,801) | 46,919 |
Net cash used in operating activities | (1,089,233) | (731,652) |
Investing activities | ||
Net cash provided by investing activities | 0 | 0 |
Financing activities | ||
Proceeds from issuance of notes payable | 0 | 1,350,000 |
Proceeds from issuance of convertible notes payable | 1,804,950 | 0 |
Repayment of notes payable | (70,620) | 0 |
Proceeds from issuance of common stock | 0 | 150,000 |
Net cash provided by financing activities | 1,734,330 | 1,500,000 |
Net increase in cash | 645,097 | 768,348 |
Cash - beginning of period | 96,308 | 252,189 |
Cash - end of period | 741,405 | 1,020,537 |
Cash paid for income taxes | 0 | 0 |
Cash paid for interest | 70,274 | 0 |
Supplemental schedule of non-cash investing and financing activities | ||
Discount on note payable from issuance of warrants | 0 | 799,128 |
Discount on notes payable from derivative liability | 1,563,929 | 0 |
Discount on convertible notes payable from derivative liability | 1,804,950 | 0 |
Shares issued for settlement of accrued interest | 7,589 | 0 |
Accrued interest settled through note payable | 78,929 | 0 |
Settlement of derivative liability | $ 50,582 | $ 0 |
NATURE OF THE ORGANIZATION AND
NATURE OF THE ORGANIZATION AND BUSINESS | 3 Months Ended |
Mar. 31, 2023 | |
NATURE OF THE ORGANIZATION AND BUSINESS | |
NATURE OF THE ORGANIZATION AND BUSINESS | NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS Nature of the Business The accompanying condensed consolidated financial statements include the accounts of the Company, and its subsidiaries Correlate, Inc. (“Correlate”), a Delaware corporation, and Loyal Enterprises LLC dba Solar Site Design (“Loyal”), a Tennessee limited liability company. Correlate is a portfolio-scale development and finance platform offering commercial and industrial facilities access to clean electrification solutions focused on locally-sited solar, energy storage, EV infrastructure, and intelligent efficiency measures. Its unique data-driven approach is powered by proprietary analytics and concierge subscription services. Loyal provided consulting services on acquisitions and project development tools to customers in the commercial solar industry. Effective November 2022, all of Loyal’s assets and operations were transferred to Correlate and Loyal was dissolved. Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception and has not generated positive cash flows from operations. These matters, among others, raise substantial doubt about the Company's ability to continue as a going concern. The Company’s ability to continue in existence is dependent on its ability to develop additional sources of capital, and/or achieve profitable operations and positive cash flows. Management’s plans with respect to operations include aggressive marketing, acquisitions, and raising additional capital through sales of equity or debt securities as may be necessary to pursue its business plans and sustain operations until such time as the Company can achieve profitability. Management believes that aggressive marketing combined with acquisitions and additional financing as necessary will result in improved operations and cash flow in 2023 and beyond. However, there can be no assurance that management will be successful in obtaining additional funding or in attaining profitable operations. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the interim reporting rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s latest Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments (unless otherwise indicated), necessary for a fair presentation of the financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents. There were no cash equivalents as of March 31, 2023 and December 31, 2022. The Company maintains its cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”). The FDIC provides coverage of up to $250,000 per depositor, per financial institution, for the aggregate total of depositors’ interest and non-interest-bearing accounts. At March 31, 2023, approximately $280,000 of the Company’s cash balances were in excess of FDIC limits. The Company has not experienced any losses on these accounts and management does not believe that the Company is exposed to any significant risks. Accounts Receivable Accounts receivable consists of invoiced and unpaid sales. The Company records an allowance for doubtful accounts to allow for any amounts that may not be recoverable, which is based on an analysis of the Company’s prior collection experience, customer credit worthiness, and current economic trends. Accounts are considered delinquent when payments have not been received within the agreed upon terms and are written off when management determines that collection is not probable. As of March 31, 2023 and December 31, 2022, the Company’s allowance for doubtful accounts was $90,189. Intangible Assets Intangible assets are amortized over their estimated useful lives. Each period, the Company evaluates the estimated remaining useful life of its intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. Management tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. Impairment Assessment The Company evaluates intangible assets and other long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. This includes but is not limited to significant adverse changes in business climate, market conditions or other events that indicate an asset's carrying amount may not be recoverable. Recoverability of these assets is measured by comparing the carrying amount of each asset to the future cash flows the asset is expected to generate. If the cash flows used in the test for recoverability are less than the carrying amount of these assets, the carrying amount of such assets is reduced to fair value. The Company evaluates and tests the recoverability of its goodwill for impairment at least annually during its fourth quarter of each fiscal year or more often if and when circumstances indicate that goodwill may not be recoverable. Revenue Recognition The Company accounts for revenue in accordance with FASB ASC 606, Revenue from Contracts with Customers. A performance obligation is a promise in a contract to transfer a distinct good or service to the client and is the unit of accounting in ASC 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on the relative standalone selling price. Determining relative standalone selling price and identifying separate performance obligations requires judgment. Contract modifications may occur in the performance of the Company’s contracts. Contracts may be modified to account for changes in the contract specifications, requirements or duration. If a contract modification results in the addition of performance obligations priced at a standalone selling price or if the post-modification services are distinct from the services provided prior to the modification, the modification is accounted for separately. If the modified services are not distinct, they are accounted for as part of the existing contract. The Company’s revenues are derived from contracts for engineering, procurement and construction services (“EPC”) and consulting. These contracts may have different terms based on the scope, performance obligations and complexity of the engagement, which may require us to make judgments and estimates in recognizing revenues. The Company’s performance obligations are satisfied as work progresses or at a point in time (for defined milestones). The selection of the method to measure progress towards completion requires judgment and is based on the contract and the nature of the services to be provided. The Company’s contracts for consulting services are typically less than a year in duration and require us to a) assist the client in achieving certain defined milestones for milestone fees or b) provide a series of distinct services each period over the contract term for a pre-determined fee for each period. When contractual billings represent an amount that corresponds directly with the value provided to the client, revenues are recognized as amounts become billable in accordance with contract terms. The Company’s contracts for EPC services are typically less than a year in duration and require us to a) provide engineering services, b) obtain materials, and c) install materials to agreed-upon specifications. The Company recognizes revenues for engineering services as the services are provided. Revenues for materials are recognized as materials are transferred to the client. Installation results in enhancements to customer-controlled assets and therefore installation revenues are recognized over time utilizing the input method wherein revenues are recognized on the basis of efforts or inputs to the satisfaction of the performance obligation. Financial Instruments The Company’s financial instruments include cash and cash equivalents, receivables, payables, and debt and are accounted for under the provisions of ASC Topic 825, “Financial Instruments”. The carrying amount of these financial instruments, with the exception of discounted debt, as reflected in the accompanying condensed consolidated balance sheets approximates fair value. Fair Value Measurement ASC Topic 820, “Fair Value Measurement”, requires that certain financial instruments be recognized at their fair values at our condensed consolidated balance sheet dates. However, other financial instruments, such as debt obligations, are not required to be recognized at their fair values, but GAAP provides an option to elect fair value accounting for these instruments. GAAP requires the disclosure of the fair values of all financial instruments, regardless of whether they are recognized at their fair values or carrying amounts in our condensed consolidated balance sheets. For financial instruments recognized at fair value, GAAP requires the disclosure of their fair values by type of instrument, along with other information, including changes in the fair values of certain financial instruments recognized in income or other comprehensive income. For financial instruments not recognized at fair value, the disclosure of their fair values is provided below under “Financial Instruments.” Nonfinancial assets, such as property, plant and equipment, and nonfinancial liabilities are recognized at their carrying amounts in the Company’s condensed consolidated balance sheets. GAAP does not permit nonfinancial assets and liabilities to be remeasured at their fair values. However, GAAP requires the remeasurement of such assets and liabilities to their fair values upon the occurrence of certain events, such as the impairment of property, plant and equipment. In addition, if such an event occurs, GAAP requires the disclosure of the fair value of the asset or liability along with other information, including the gain or loss recognized in income in the period the remeasurement occurred. Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; Level 2 – Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; or Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company did not have any Level 1 or Level 2 assets and liabilities at March 31, 2023 or December 31, 2022. The Derivative liabilities are Level 3 fair value measurements. The following is a summary of activity of Level 3 liabilities during the three months ended March 31, 2023: Balance – December 31, 2022 $ 722,328 Additions 7,172,944 Settlement (50,582 ) Change in fair value (2,487,120 ) Balance – March 31, 2023 $ 5,357,570 Under the Company’s contract ordering policy, the Company first considers common shares issued and outstanding as well as reserved but unissued equity awards, such as under an equity award program. All remaining equity linked instruments such as, but not limited to, options, warrants, and debt and equity with conversion features are evaluated based on the date of issuance. If the number of shares which may be issued under the Company’s agreements exceed the authorized number of shares or are unable to be determined, equity linked instruments from that date forward are considered to be derivative liabilities until such time as the number of shares which may be issued under the Company’s agreements no longer exceed the authorized number of shares and are able to be determined. On November 7, 2022 and December 21, 2022, the Company issued note payable agreements which contain default provisions that contain a conversion feature meeting the definition of a derivative liability which therefore require bifurcation. Further, pursuant to the Company’s contract ordering policy, the warrant and convertible note issuances subsequent to November 7, 2022, resulted in derivative liabilities. At December 31, 2022, the Company estimated the fair value of the conversion feature derivatives embedded in the notes payable and warrants based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock of $1.06; risk-free interest rates ranging from 4.41% to 4.73%; expected volatility of the Company’s common stock ranging from 164% to 379%; exercise prices of $1.00; and terms from one to two years. At March 31, 2023, the Company estimated the fair value of the conversion feature derivatives embedded in the notes payable, convertible notes payable and warrants based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock of $0.70; risk-free interest rates ranging from 3.60% to 4.94%; expected volatility of the Company’s common stock ranging from 97% to 305%; exercise prices ranging from $0.46 to $3.20; and terms ranging from six months to five years. Commitments and Contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties and other sources are recorded when management assesses that it is probable that a liability has been incurred and the amount can be reasonably estimated. Income Taxes In accordance with FASB ASC Topic 740, "Income Taxes," the Company provides for the recognition of deferred tax assets if realization of such assets is more likely than not. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. In addition, the Company’s management performs an evaluation of all uncertain income tax positions taken or expected to be taken in the course of preparing the Company’s income tax returns to determine whether the income tax positions meet a “more likely than not” standard of being sustained under examination by the applicable taxing authorities. This evaluation is required to be performed for all open tax years, as defined by the various statutes of limitations, for federal and state purposes. If the Company has interest or penalties associated with insufficient taxes paid, such expenses are reported in income tax expense. Basic and Diluted Loss Per Share FASB ASC Topic 260, “Earnings Per Share”, requires a reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share (“EPS”) computations. Basic earnings (loss) per share are computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company had potential additional dilutive securities outstanding at March 31, 2023 and 2022, as follows. March 31, March 31, 2023 2022 Options 5,784,068 3,059,068 Warrants 10,517,758 2,700,000 Notes payable 877,897 - Convertible notes payable 564,048 - 17,743,771 5,759,068 Recently Issued Accounting Standards During the period ended March 31, 2023, there were several new accounting pronouncements issued by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s condensed consolidated financial statements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 3 – COMMITMENTS AND CONTINGENCIES From time to time, the Company may be involved in litigation in the ordinary course of business. The Company is not currently involved in any litigation that the Company believes could have a material adverse effect on its financial condition or results of operations. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2023 | |
DEBT | |
DEBT | NOTE 4 – DEBT Convertible Notes Payable From January 24, 2023 to March 30, 2023, the Company entered into eight 14% convertible note payable agreements with proceeds totaling $1,804,950. The convertible notes, which have identical terms, require quarterly interest payments with the principal due at maturity eighteen months from issuances and are convertible at $3.20 per share of common stock. The conversion features were valued at $358,176 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. In connection with the convertible notes, the Company issued a total of 3,609,900 warrants to purchase shares of common stock exercisable at $0.85 per share. The warrants, which were immediately vested, were valued at $3,505,723 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. As a result of the derivative liabilities, the Company recorded additional debt discounts totaling $3,505,723. Included in the eight convertible notes payable is a 14% convertible note payable agreement with proceeds totaling $100,000 with the Company’s CEO issued on January 24, 2023. The convertible note requires quarterly interest payments with the principal due at maturity eighteen months from issuance and is convertible at $3.20 per share of common stock. The conversion feature was valued at $22,569 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. In connection with the convertible note, the Company issued 200,000 warrants to purchase shares of common stock exercisable at $0.85 per share. The warrants, which were immediately vested, were valued at $209,180 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. As a result of the derivative liabilities, the Company recorded a debt discount totaling $100,000. The following table presents a summary of the Company’s convertible notes payable at March 31, 2023: Balances - At Issuance Balances - 3/31/2023 Origination Maturity Interest Conversion Rate Principal Discount Principal Discount 1/24/2023 7/24/2024 14 % $3.20/Share $ 100,000 $ 100,000 $ 100,000 $ 87,888 1/25/2023 7/25/2024 14 % $3.20/Share 74,975 74,975 74,975 66,145 1/30/2023 7/30/2024 14 % $3.20/Share 100,000 100,000 100,000 88,888 2/17/2023 8/17/2024 14 % $3.20/Share 1,000,000 1,000,000 1,000,000 916,666 3/7/2023 9/7/2024 14 % $3.20/Share 100,000 100,000 100,000 96,000 3/14/2023 9/10/2024 14 % $3.20/Share 250,000 250,000 250,000 243,000 3/27/2023 9/27/2024 14 % $3.20/Share 100,000 100,000 100,000 99,500 3/30/2023 9/30/2024 14 % $3.20/Share 79,975 79,975 79,975 79,975 $ 1,804,950 $ 1,678,062 Notes Payable On May 29, 2020, Loyal received a $20,400 Economic Injury Disaster Loan through the Small Business Administration. The note bears interest at 3.75% until maturity in March 2050. The note requires $100 monthly payments beginning in May 2022 until maturity. On January 11, 2022, the Company entered into a 10% note agreement with P&C Ventures, Inc. totaling $1,485,000, including an original issuance discount of $135,000. The note requires quarterly interest payments with the principal due at maturity on January 11, 2023. On January 11, 2023, the Company and P&C Ventures, Inc. agreed to amend the January 11, 2022, note payable. The Company accounted for the amendment as an extinguishment of existing debt and issuance of new debt pursuant to ASC 470-50-40. As part of the agreement, $78,929 in accrued and unpaid interest was added to the principal balance, bringing the total principal balance of the note payable to $1,563,929. Additionally, the interest rate and maturity date were amended to 14% and October 11, 2023, respectively. In connection with the amendment, the Company issued P&C Ventures, Inc. 3,127,858 warrants to purchase shares of common stock exercisable at $0.85 per share. The warrants, which were immediately vested, were valued at $3,309,045 and recorded as a derivative liability pursuant to the Company’s contract ordering policy and resulted in additional debt discounts totaling $1,563,929. The following table presents a summary of the Company’s notes payable at March 31, 2023: Balances - At Issuance Balances - 3/31/2023 Origination Maturity Interest Principal Discount Principal Discount 5/29/2020 3/31/2050 4 % $ 20,400 $ - $ 20,400 $ - 7/29/2022 1/29/2024 10 % 50,000 29,664 50,000 16,480 8/11/2022 2/11/2024 10 % 150,000 88,247 150,000 51,476 8/15/2022 2/15/2024 10 % 50,000 29,513 50,000 17,213 8/31/2022 2/28/2024 10 % 80,000 45,827 80,000 28,005 9/1/2022 3/1/2024 10 % 50,000 29,922 50,000 18,288 9/7/2022 3/7/2024 10 % 50,000 29,922 50,000 18,288 9/12/2022 3/12/2024 10 % 50,000 30,316 50,000 19,370 9/29/2022 3/29/2024 10 % 100,000 59,839 100,000 39,893 11/7/2022 11/7/2023 7 % 200,000 220,000 188,320 137,497 11/9/2022 5/9/2024 10 % 25,000 25,000 25,000 18,750 11/15/2022 5/15/2024 10 % 100,000 100,000 100,000 74,999 12/21/2022 12/21/2023 7 % 200,000 220,000 211,860 155,831 1/11/2023 10/11/2023 14 % 1,563,929 1,563,929 1,563,929 1,129,504 $ 2,689,509 $ 1,725,594 The following table presents a summary of the Company’s notes payable at December 31, 2022: Balances - At Issuance Balances - 12/31/2022 Origination Maturity Interest Principal Discount Principal Discount 5/29/2020 3/31/2050 4 % $ 20,400 $ - $ 20,400 $ - 1/11/2022 1/11/2023 10 % 1,350,000 934,128 1,485,000 38,922 7/29/2022 1/29/2024 10 % 50,000 29,664 50,000 21,424 8/11/2022 2/11/2024 10 % 150,000 88,247 150,000 66,185 8/15/2022 2/15/2024 10 % 50,000 29,513 50,000 22,133 8/31/2022 2/28/2024 10 % 80,000 45,827 80,000 35,643 9/1/2022 3/1/2024 10 % 50,000 29,922 50,000 23,274 9/7/2022 3/7/2024 10 % 50,000 29,922 50,000 23,274 9/12/2022 3/12/2024 10 % 50,000 30,316 50,000 24,422 9/29/2022 3/29/2024 10 % 100,000 59,839 100,000 49,866 11/7/2022 11/7/2023 7 % 200,000 220,000 235,400 192,499 11/9/2022 5/9/2024 10 % 25,000 25,000 25,000 22,917 11/15/2022 5/15/2024 10 % 100,000 100,000 100,000 91,667 12/21/2022 12/21/2023 7 % 200,000 220,000 235,400 210,833 $ 2,681,200 $ 823,059 Line of Credit On October 3, 2014, the Company entered into a $30,000 line of credit agreement with a former member of Loyal. The line of credit has no maturity with interest at 8.00%. As of March 31, 2023 and December 31, 2022, the outstanding principal and accrued interest totaled $30,200 and $42,130, respectively. Future Maturities The table below summarizes future maturities of the Company’s debt as of March 31, 2023: December 31, Amount 2023 $ 1,994,109 2024 2,509,950 2025 - 2026 - 2027 - Thereafter 20,400 4,524,459 Less - Discounts (3,403,656 ) $ 1,120,803 |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2023 | |
EQUITY | |
EQUITY | NOTE 5 – EQUITY Common Stock During January 2023, the Company issued 4,245 shares of common stock valued at $4,500 for financing costs. During March 2023, the Company issued 17,045 shares of common stock valued at $15,000 for services. During January 2023, the Company paid $7,589 in accrued interest due to four noteholders by issuing 5,655 shares of common stock. Warrants During the period ended March 31, 2023, the Company calculated the fair value of the warrants granted based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock on the date of issuance; risk-free interest rates ranging from 3.66% to 5.00%; volatility ranging from 278% to 346% based on the historical volatility of the Company’s common stock; exercise prices of $0.85; and terms of 24 to 60 months. On January 11, 2023, the Company issued 3,127,858 warrants valued at $3,309,000 as part of a note agreement amendment (Note 4). From January 24, 2023 to March 30, 2023, the Company issued warrants to purchase 3,609,900 shares of common stock valued at approximately $3,506,000 as part of note agreements (Note 4). Included in these warrants is a warrant to purchase 200,000 shares of common stock which was issued to the Company’s CEO. The table below summarizes the Company’s warrants for the period ended March 31, 2023: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Life (in years) Warrants as of December 31, 2022 3,780,000 $ 0.48 0.87 Issued 6,737,758 $ 0.85 3.39 Exercised - $ - - Warrants as of March 31, 2023 10,517,758 $ 0.72 2.30 Options During the period ended March 31, 2023, the Company calculated the fair value of the options granted based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock on the date of issuance; risk-free interest rate of 4.27%; volatility of 277% based on the historical volatility of the Company’s common stock; exercise price of $0.99; and terms of 5 years. The fair value of options granted is expensed as vesting occurs over the applicable service periods. During March 2023, the Company issued 500,000 options to purchase shares of common stock exercisable at $0.99 per share. The options, which were issued as part of a services agreement, vest over 36 months and were valued at $448,950. The following table summarizes the Company’s options for the period ended March 31, 2023: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Life (in years) Options as of December 31, 2022 5,284,068 $ 0.80 4.17 Issued 500,000 $ 0.99 5.00 Exercised - $ - - Options as of March 31, 2023 5,784,068 $ 0.82 4.01 At March 31, 2023, options to purchase 2,630,803 shares of common stock were vested and options to purchase 3,153,265 shares of common stock remained unvested. The Company expects to incur expenses for the unvested options totaling $2,167,081 as they vest. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS Shareholder Advances and Payables At March 31, 2023 and December 31, 2022, the Company had advances payable of $22,154, respectively, due to the Company’s President and CEO, Mr. Todd Michaels. Mr. Michaels is also a member of the Company’s Board of Directors and holds approximately 10% of the Company’s common stock. At March 31, 2023 and December 31, 2022, the Company had advances payable of $11,865, respectively, due to an individual who holds less than 5% of the Company’s common stock. At March 31, 2023 and December 31, 2022, the Company had advances payable of $62,500 due to an individual who is the Company’s largest shareholder. At March 31, 2023, this individual held approximately 31% of the Company’s common stock. At March 31, 2023 and December 31, 2022, the Company had accounts payable of $259,000 and $256,000, respectively, due to Elysian Fields Disposal, LLC, an entity owned by the Company’s largest shareholder. The Company incurred $3,000 of operating expenses with the entity during the period ended March 31, 2023. At March 31, 2023 and December 31, 2022, the Company had accounts payable of $73,000, respectively, due to Loutex Production Company, an entity owned by the Company’s largest shareholder. At March 31, 2023, the Company had accounts payable of $20,000 due to P&C Ventures, Inc. The Company incurred $20,000 of operating expenses with P&C Ventures Inc. during the period ended March 31, 2023. Mr. Cory Hunt, who was named a director of the Company on December 28, 2021, is an owner and officer of P&C Ventures, Inc. Michaels Consulting At March 31, 2023 and December 31, 2022, the Company had accounts payable of $344,000, respectively, due to Michaels Consulting, an entity owned by the wife of Mr. Michaels. Notes Payable During January 2023, the Company amended the January 2022 note agreement with P&C Ventures, Inc. and issued warrants related to the amendment, as disclosed in Note 4. Convertible Notes Payable During January 2023, the Company entered into a convertible note agreement with Mr. Michaels totaling $100,000 and issued 200,000 warrants, valued at approximately $209,000, related to the note, as disclosed in Note 4. Accrued Bonus At March 31, 2023, the Company accrued bonus compensation for its CEO and CFO of approximately $150,000 and $115,000, respectively. The accrued bonus compensation was unchanged from December 31, 2022. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 7 – SUBSEQUENT EVENTS From April to May 2023, the Company entered into four 14% convertible note payable agreements with proceeds totaling $700,000. The convertible notes, which have identical terms, require quarterly interest payments with the principal due at maturity eighteen months from issuances and are convertible at $3.20 per share of common stock. The conversion features were valued at $93,549 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. In connection with the convertible notes, the Company issued a total of 1,400,000 warrants to purchase shares of common stock exercisable at $0.85 per share. The warrants, which were immediately vested, were valued at $932,739 and recorded as a derivative liability pursuant to the Company’s contract ordering policy. As a result of the derivative liabilities, the Company recorded additional debt discounts totaling $700,000. From April to May 2023, the Company issued 150,000 options to purchase shares of common stock exercisable at prices ranging from $0.54 to $0.572 per share. The options, which vest over 36 months, were valued at $105,796. During April 2023, the Company entered into a consulting agreement. Pursuant to the consulting agreement, the Company issued 500,000 shares of common stock valued at $425,000. 125,000 shares vested immediately, with the remaining 375,000 shares vested over 24 months. During April 2023, the Company paid $6,995 in accrued interest due to four noteholders by issuing 7,661 shares of common stock. Included in these shares were 1,350 shares issued to the wife of the Company’s CEO and 2,815 shares issued to the Company’s CEO. During April 2023, the Company issued 58,496 warrants to purchase shares of common stock exercisable at $0.85 per share for two years. The warrants, which were immediately vested, were valued at $47,858. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation | The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents. There were no cash equivalents as of March 31, 2023 and December 31, 2022. The Company maintains its cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”). The FDIC provides coverage of up to $250,000 per depositor, per financial institution, for the aggregate total of depositors’ interest and non-interest-bearing accounts. At March 31, 2023, approximately $280,000 of the Company’s cash balances were in excess of FDIC limits. The Company has not experienced any losses on these accounts and management does not believe that the Company is exposed to any significant risks. |
Accounts Receivable | Accounts receivable consists of invoiced and unpaid sales. The Company records an allowance for doubtful accounts to allow for any amounts that may not be recoverable, which is based on an analysis of the Company’s prior collection experience, customer credit worthiness, and current economic trends. Accounts are considered delinquent when payments have not been received within the agreed upon terms and are written off when management determines that collection is not probable. As of March 31, 2023 and December 31, 2022, the Company’s allowance for doubtful accounts was $90,189. |
Intangible Assets | Intangible assets are amortized over their estimated useful lives. Each period, the Company evaluates the estimated remaining useful life of its intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. Management tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. |
Impairment Assessment | The Company evaluates intangible assets and other long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. This includes but is not limited to significant adverse changes in business climate, market conditions or other events that indicate an asset's carrying amount may not be recoverable. Recoverability of these assets is measured by comparing the carrying amount of each asset to the future cash flows the asset is expected to generate. If the cash flows used in the test for recoverability are less than the carrying amount of these assets, the carrying amount of such assets is reduced to fair value. The Company evaluates and tests the recoverability of its goodwill for impairment at least annually during its fourth quarter of each fiscal year or more often if and when circumstances indicate that goodwill may not be recoverable. |
Revenue Recognition | The Company accounts for revenue in accordance with FASB ASC 606, Revenue from Contracts with Customers. A performance obligation is a promise in a contract to transfer a distinct good or service to the client and is the unit of accounting in ASC 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on the relative standalone selling price. Determining relative standalone selling price and identifying separate performance obligations requires judgment. Contract modifications may occur in the performance of the Company’s contracts. Contracts may be modified to account for changes in the contract specifications, requirements or duration. If a contract modification results in the addition of performance obligations priced at a standalone selling price or if the post-modification services are distinct from the services provided prior to the modification, the modification is accounted for separately. If the modified services are not distinct, they are accounted for as part of the existing contract. The Company’s revenues are derived from contracts for engineering, procurement and construction services (“EPC”) and consulting. These contracts may have different terms based on the scope, performance obligations and complexity of the engagement, which may require us to make judgments and estimates in recognizing revenues. The Company’s performance obligations are satisfied as work progresses or at a point in time (for defined milestones). The selection of the method to measure progress towards completion requires judgment and is based on the contract and the nature of the services to be provided. The Company’s contracts for consulting services are typically less than a year in duration and require us to a) assist the client in achieving certain defined milestones for milestone fees or b) provide a series of distinct services each period over the contract term for a pre-determined fee for each period. When contractual billings represent an amount that corresponds directly with the value provided to the client, revenues are recognized as amounts become billable in accordance with contract terms. The Company’s contracts for EPC services are typically less than a year in duration and require us to a) provide engineering services, b) obtain materials, and c) install materials to agreed-upon specifications. The Company recognizes revenues for engineering services as the services are provided. Revenues for materials are recognized as materials are transferred to the client. Installation results in enhancements to customer-controlled assets and therefore installation revenues are recognized over time utilizing the input method wherein revenues are recognized on the basis of efforts or inputs to the satisfaction of the performance obligation. |
Financial Instruments | The Company’s financial instruments include cash and cash equivalents, receivables, payables, and debt and are accounted for under the provisions of ASC Topic 825, “Financial Instruments”. The carrying amount of these financial instruments, with the exception of discounted debt, as reflected in the accompanying condensed consolidated balance sheets approximates fair value. |
Fair Value Measurement | ASC Topic 820, “Fair Value Measurement”, requires that certain financial instruments be recognized at their fair values at our condensed consolidated balance sheet dates. However, other financial instruments, such as debt obligations, are not required to be recognized at their fair values, but GAAP provides an option to elect fair value accounting for these instruments. GAAP requires the disclosure of the fair values of all financial instruments, regardless of whether they are recognized at their fair values or carrying amounts in our condensed consolidated balance sheets. For financial instruments recognized at fair value, GAAP requires the disclosure of their fair values by type of instrument, along with other information, including changes in the fair values of certain financial instruments recognized in income or other comprehensive income. For financial instruments not recognized at fair value, the disclosure of their fair values is provided below under “Financial Instruments.” Nonfinancial assets, such as property, plant and equipment, and nonfinancial liabilities are recognized at their carrying amounts in the Company’s condensed consolidated balance sheets. GAAP does not permit nonfinancial assets and liabilities to be remeasured at their fair values. However, GAAP requires the remeasurement of such assets and liabilities to their fair values upon the occurrence of certain events, such as the impairment of property, plant and equipment. In addition, if such an event occurs, GAAP requires the disclosure of the fair value of the asset or liability along with other information, including the gain or loss recognized in income in the period the remeasurement occurred. Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; Level 2 – Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; or Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company did not have any Level 1 or Level 2 assets and liabilities at March 31, 2023 or December 31, 2022. The Derivative liabilities are Level 3 fair value measurements. The following is a summary of activity of Level 3 liabilities during the three months ended March 31, 2023: Balance – December 31, 2022 $ 722,328 Additions 7,172,944 Settlement (50,582 ) Change in fair value (2,487,120 ) Balance – March 31, 2023 $ 5,357,570 Under the Company’s contract ordering policy, the Company first considers common shares issued and outstanding as well as reserved but unissued equity awards, such as under an equity award program. All remaining equity linked instruments such as, but not limited to, options, warrants, and debt and equity with conversion features are evaluated based on the date of issuance. If the number of shares which may be issued under the Company’s agreements exceed the authorized number of shares or are unable to be determined, equity linked instruments from that date forward are considered to be derivative liabilities until such time as the number of shares which may be issued under the Company’s agreements no longer exceed the authorized number of shares and are able to be determined. On November 7, 2022 and December 21, 2022, the Company issued note payable agreements which contain default provisions that contain a conversion feature meeting the definition of a derivative liability which therefore require bifurcation. Further, pursuant to the Company’s contract ordering policy, the warrant and convertible note issuances subsequent to November 7, 2022, resulted in derivative liabilities. At December 31, 2022, the Company estimated the fair value of the conversion feature derivatives embedded in the notes payable and warrants based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock of $1.06; risk-free interest rates ranging from 4.41% to 4.73%; expected volatility of the Company’s common stock ranging from 164% to 379%; exercise prices of $1.00; and terms from one to two years. At March 31, 2023, the Company estimated the fair value of the conversion feature derivatives embedded in the notes payable, convertible notes payable and warrants based on assumptions used in the Cox-Ross-Rubinstein binomial pricing model using the following inputs: the price of the Company’s common stock of $0.70; risk-free interest rates ranging from 3.60% to 4.94%; expected volatility of the Company’s common stock ranging from 97% to 305%; exercise prices ranging from $0.46 to $3.20; and terms ranging from six months to five years. |
Commitments and Contingencies | Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties and other sources are recorded when management assesses that it is probable that a liability has been incurred and the amount can be reasonably estimated. |
Income Taxes | In accordance with FASB ASC Topic 740, "Income Taxes," the Company provides for the recognition of deferred tax assets if realization of such assets is more likely than not. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. In addition, the Company’s management performs an evaluation of all uncertain income tax positions taken or expected to be taken in the course of preparing the Company’s income tax returns to determine whether the income tax positions meet a “more likely than not” standard of being sustained under examination by the applicable taxing authorities. This evaluation is required to be performed for all open tax years, as defined by the various statutes of limitations, for federal and state purposes. If the Company has interest or penalties associated with insufficient taxes paid, such expenses are reported in income tax expense. |
Basic and Diluted Loss Per Share | FASB ASC Topic 260, “Earnings Per Share”, requires a reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share (“EPS”) computations. Basic earnings (loss) per share are computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company had potential additional dilutive securities outstanding at March 31, 2023 and 2022, as follows. March 31, March 31, 2023 2022 Options 5,784,068 3,059,068 Warrants 10,517,758 2,700,000 Notes payable 877,897 - Convertible notes payable 564,048 - 17,743,771 5,759,068 |
Going Concern | The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception and has not generated positive cash flows from operations. These matters, among others, raise substantial doubt about the Company's ability to continue as a going concern. The Company’s ability to continue in existence is dependent on its ability to develop additional sources of capital, and/or achieve profitable operations and positive cash flows. Management’s plans with respect to operations include aggressive marketing, acquisitions, and raising additional capital through sales of equity or debt securities as may be necessary to pursue its business plans and sustain operations until such time as the Company can achieve profitability. Management believes that aggressive marketing combined with acquisitions and additional financing as necessary will result in improved operations and cash flow in 2023 and beyond. However, there can be no assurance that management will be successful in obtaining additional funding or in attaining profitable operations. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Recently Issued Accounting Standards | During the period ended March 31, 2023, there were several new accounting pronouncements issued by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Fair Value Measurement | Balance – December 31, 2022 $ 722,328 Additions 7,172,944 Settlement (50,582 ) Change in fair value (2,487,120 ) Balance – March 31, 2023 $ 5,357,570 |
potential additional dilutive securities outstanding | March 31, March 31, 2023 2022 Options 5,784,068 3,059,068 Warrants 10,517,758 2,700,000 Notes payable 877,897 - Convertible notes payable 564,048 - 17,743,771 5,759,068 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
DEBT | |
summary of the Company's convertible notes payable | Balances - At Issuance Balances - 3/31/2023 Origination Maturity Interest Conversion Rate Principal Discount Principal Discount 1/24/2023 7/24/2024 14 % $3.20/Share $ 100,000 $ 100,000 $ 100,000 $ 87,888 1/25/2023 7/25/2024 14 % $3.20/Share 74,975 74,975 74,975 66,145 1/30/2023 7/30/2024 14 % $3.20/Share 100,000 100,000 100,000 88,888 2/17/2023 8/17/2024 14 % $3.20/Share 1,000,000 1,000,000 1,000,000 916,666 3/7/2023 9/7/2024 14 % $3.20/Share 100,000 100,000 100,000 96,000 3/14/2023 9/10/2024 14 % $3.20/Share 250,000 250,000 250,000 243,000 3/27/2023 9/27/2024 14 % $3.20/Share 100,000 100,000 100,000 99,500 3/30/2023 9/30/2024 14 % $3.20/Share 79,975 79,975 79,975 79,975 $ 1,804,950 $ 1,678,062 |
summary of the Company's notes payable | Balances - At Issuance Balances - 3/31/2023 Origination Maturity Interest Principal Discount Principal Discount 5/29/2020 3/31/2050 4 % $ 20,400 $ - $ 20,400 $ - 7/29/2022 1/29/2024 10 % 50,000 29,664 50,000 16,480 8/11/2022 2/11/2024 10 % 150,000 88,247 150,000 51,476 8/15/2022 2/15/2024 10 % 50,000 29,513 50,000 17,213 8/31/2022 2/28/2024 10 % 80,000 45,827 80,000 28,005 9/1/2022 3/1/2024 10 % 50,000 29,922 50,000 18,288 9/7/2022 3/7/2024 10 % 50,000 29,922 50,000 18,288 9/12/2022 3/12/2024 10 % 50,000 30,316 50,000 19,370 9/29/2022 3/29/2024 10 % 100,000 59,839 100,000 39,893 11/7/2022 11/7/2023 7 % 200,000 220,000 188,320 137,497 11/9/2022 5/9/2024 10 % 25,000 25,000 25,000 18,750 11/15/2022 5/15/2024 10 % 100,000 100,000 100,000 74,999 12/21/2022 12/21/2023 7 % 200,000 220,000 211,860 155,831 1/11/2023 10/11/2023 14 % 1,563,929 1,563,929 1,563,929 1,129,504 $ 2,689,509 $ 1,725,594 Balances - At Issuance Balances - 12/31/2022 Origination Maturity Interest Principal Discount Principal Discount 5/29/2020 3/31/2050 4 % $ 20,400 $ - $ 20,400 $ - 1/11/2022 1/11/2023 10 % 1,350,000 934,128 1,485,000 38,922 7/29/2022 1/29/2024 10 % 50,000 29,664 50,000 21,424 8/11/2022 2/11/2024 10 % 150,000 88,247 150,000 66,185 8/15/2022 2/15/2024 10 % 50,000 29,513 50,000 22,133 8/31/2022 2/28/2024 10 % 80,000 45,827 80,000 35,643 9/1/2022 3/1/2024 10 % 50,000 29,922 50,000 23,274 9/7/2022 3/7/2024 10 % 50,000 29,922 50,000 23,274 9/12/2022 3/12/2024 10 % 50,000 30,316 50,000 24,422 9/29/2022 3/29/2024 10 % 100,000 59,839 100,000 49,866 11/7/2022 11/7/2023 7 % 200,000 220,000 235,400 192,499 11/9/2022 5/9/2024 10 % 25,000 25,000 25,000 22,917 11/15/2022 5/15/2024 10 % 100,000 100,000 100,000 91,667 12/21/2022 12/21/2023 7 % 200,000 220,000 235,400 210,833 $ 2,681,200 $ 823,059 |
summarizes future maturities | December 31, Amount 2023 $ 1,994,109 2024 2,509,950 2025 - 2026 - 2027 - Thereafter 20,400 4,524,459 Less - Discounts (3,403,656 ) $ 1,120,803 |
EQUITY (Tables)
EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
EQUITY | |
Company's warrants | Number of Shares Weighted Average Exercise Price Weighted Average Remaining Life (in years) Warrants as of December 31, 2022 3,780,000 $ 0.48 0.87 Issued 6,737,758 $ 0.85 3.39 Exercised - $ - - Warrants as of March 31, 2023 10,517,758 $ 0.72 2.30 |
Company's options | Number of Shares Weighted Average Exercise Price Weighted Average Remaining Life (in years) Options as of December 31, 2022 5,284,068 $ 0.80 4.17 Issued 500,000 $ 0.99 5.00 Exercised - $ - - Options as of March 31, 2023 5,784,068 $ 0.82 4.01 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Balance | $ 722,328 |
Additions | 7,172,944 |
Settlement | (50,582) |
Change in fair value | (2,487,120) |
Balance at end | $ 5,357,570 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Options | 5,784,068 | 3,059,068 |
Warrants | 10,517,758 | 2,700,000 |
Notes payable | 877,897 | |
Convertible notes payable | $ 564,048 | $ 0 |
Dilutive Securities | 17,743,771 | 5,759,068 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
FDIC coverage amount | $ 250,000 | ||
FDIC cash balances limits | 280,000 | ||
Allowance for doubtful accounts | $ 90,189 | $ 90,189 | |
Share price | $ 0.70 | $ 1.06 | |
Risk-free interest rate, minimum | 3.60% | 4.41% | |
Risk-free interest rate, maximum | 4.94% | 4.73% | |
Expected volatility rate, minimum | 97% | 164% | |
Expected volatility rate, maximum | 305% | 379% | |
Exercise prices | $ 1 | ||
Expected term | six months to five years | one to two years | |
Minimum [Member] | |||
Exercise prices | $ 0.46 | ||
Maximum [Member] | |||
Exercise prices | $ 3.20 |
DEBT (Details)
DEBT (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Principal | $ 2,689,509 | $ 2,681,200 |
Convertible Notes Payable [Member] | ||
Principal amount | 100,000 | |
Debt Discount | 100,000 | |
Principal | 100,000 | |
Discount | $ 87,888 | |
Origination date | Jan. 24, 2023 | |
Maturity date | Jul. 24, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable One [Member] | ||
Principal amount | $ 74,975 | |
Debt Discount | 74,975 | |
Principal | 74,975 | |
Discount | $ 66,145 | |
Origination date | Jan. 25, 2023 | |
Maturity date | Jul. 25, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Two [Member] | ||
Principal amount | $ 100,000 | |
Debt Discount | 100,000 | |
Principal | 100,000 | |
Discount | $ 88,888 | |
Origination date | Jan. 30, 2023 | |
Maturity date | Jul. 30, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Three [Member] | ||
Principal amount | $ 1,000,000 | |
Debt Discount | 1,000,000 | |
Principal | 1,000,000 | |
Discount | $ 916,666 | |
Origination date | Feb. 17, 2023 | |
Maturity date | Aug. 17, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Four [Member] | ||
Principal amount | $ 100,000 | |
Debt Discount | 100,000 | |
Principal | 100,000 | |
Discount | $ 96,000 | |
Origination date | Mar. 07, 2023 | |
Maturity date | Sep. 07, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Five [Member] | ||
Principal amount | $ 250,000 | |
Debt Discount | 250,000 | |
Principal | 250,000 | |
Discount | $ 243,000 | |
Origination date | Mar. 14, 2023 | |
Maturity date | Sep. 10, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Six [Member] | ||
Principal amount | $ 100,000 | |
Debt Discount | 100,000 | |
Principal | 100,000 | |
Discount | $ 99,500 | |
Origination date | Mar. 27, 2023 | |
Maturity date | Sep. 27, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Seven [Member] | ||
Principal amount | $ 79,975 | |
Debt Discount | 79,975 | |
Principal | 79,975 | |
Discount | $ 79,975 | |
Origination date | Mar. 30, 2023 | |
Maturity date | Sep. 30, 2024 | |
Interest Rate | 14% | |
Conversion Rate | $ 3.20 | |
Convertible Notes Payable Total [Member] | ||
Principal | $ 1,804,950 | |
Discount | $ 1,678,062 |
DEBT (Details 1)
DEBT (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Principal | $ 2,689,509 | $ 2,681,200 |
Discount | 1,725,594 | 823,059 |
Notes Payable [Member] | ||
Principal amount | 20,400 | 20,400 |
Debt Discount | 0 | 0 |
Principal | 20,400 | 20,400 |
Discount | $ 0 | $ 0 |
Origination date | May 29, 2020 | May 29, 2020 |
Maturity date | Mar. 31, 2050 | Mar. 31, 2050 |
Interest Rate | 4% | 4% |
Notes Payable One [Member] | ||
Principal amount | $ 50,000 | $ 1,350,000 |
Debt Discount | 29,664 | 934,128 |
Principal | 50,000 | 1,485,000 |
Discount | $ 16,480 | $ 38,922 |
Origination date | Jul. 29, 2022 | Jan. 11, 2022 |
Maturity date | Jan. 29, 2024 | Jan. 11, 2023 |
Interest Rate | 10% | 10% |
Notes Payable Two [Member] | ||
Principal amount | $ 150,000 | $ 50,000 |
Debt Discount | 88,247 | 29,664 |
Principal | 150,000 | 50,000 |
Discount | $ 51,476 | $ 21,424 |
Origination date | Aug. 11, 2022 | Jul. 29, 2022 |
Maturity date | Feb. 11, 2024 | Jan. 29, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Four [Member] | ||
Principal amount | $ 80,000 | $ 50,000 |
Debt Discount | 45,827 | 29,513 |
Principal | 80,000 | 50,000 |
Discount | $ 28,005 | $ 22,133 |
Origination date | Aug. 31, 2022 | Aug. 15, 2022 |
Maturity date | Feb. 28, 2024 | Feb. 15, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Three [Member] | ||
Principal amount | $ 50,000 | $ 150,000 |
Debt Discount | 29,513 | 88,247 |
Principal | 50,000 | 150,000 |
Discount | $ 17,213 | $ 66,185 |
Origination date | Aug. 15, 2022 | Aug. 11, 2022 |
Maturity date | Feb. 15, 2024 | Feb. 11, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Six [Member] | ||
Principal amount | $ 50,000 | $ 50,000 |
Debt Discount | 29,922 | 29,922 |
Principal | 50,000 | 50,000 |
Discount | $ 18,288 | $ 23,274 |
Origination date | Sep. 07, 2022 | Sep. 01, 2022 |
Maturity date | Mar. 07, 2024 | Mar. 01, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Seven [Member] | ||
Principal amount | $ 50,000 | $ 50,000 |
Debt Discount | 30,316 | 29,922 |
Principal | 50,000 | 50,000 |
Discount | $ 19,370 | $ 23,274 |
Origination date | Sep. 12, 2022 | Sep. 07, 2022 |
Maturity date | Mar. 12, 2024 | Mar. 07, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Five [Member] | ||
Principal amount | $ 50,000 | $ 80,000 |
Debt Discount | 29,922 | 45,827 |
Principal | 50,000 | 80,000 |
Discount | $ 18,288 | $ 35,643 |
Origination date | Sep. 01, 2022 | Aug. 31, 2022 |
Maturity date | Mar. 01, 2024 | Feb. 28, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Eight [Member] | ||
Principal amount | $ 100,000 | $ 50,000 |
Debt Discount | 59,839 | 30,316 |
Principal | 100,000 | 50,000 |
Discount | $ 39,893 | $ 24,422 |
Origination date | Sep. 29, 2022 | Sep. 12, 2022 |
Maturity date | Mar. 29, 2024 | Mar. 12, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Nine [Member] | ||
Principal amount | $ 200,000 | $ 100,000 |
Debt Discount | 220,000 | 59,839 |
Principal | 188,320 | 100,000 |
Discount | $ 137,497 | $ 49,866 |
Origination date | Nov. 07, 2022 | Sep. 29, 2022 |
Maturity date | Nov. 07, 2023 | Mar. 29, 2024 |
Interest Rate | 7% | 10% |
Notes Payable Twelve [Member] | ||
Principal amount | $ 200,000 | $ 100,000 |
Debt Discount | 220,000 | 100,000 |
Principal | 211,860 | 100,000 |
Discount | $ 155,831 | $ 91,667 |
Origination date | Dec. 21, 2022 | Nov. 15, 2022 |
Maturity date | Dec. 21, 2023 | May 15, 2024 |
Interest Rate | 7% | 10% |
Notes Payable Ten [Member] | ||
Principal amount | $ 25,000 | $ 200,000 |
Debt Discount | 25,000 | 220,000 |
Principal | 25,000 | 235,400 |
Discount | $ 18,750 | $ 192,499 |
Origination date | Nov. 09, 2022 | Nov. 07, 2022 |
Maturity date | May 09, 2024 | Nov. 07, 2023 |
Interest Rate | 10% | 7% |
Notes Payable Eleven [Member] | ||
Principal amount | $ 100,000 | $ 25,000 |
Debt Discount | 100,000 | 25,000 |
Principal | 100,000 | 25,000 |
Discount | $ 74,999 | $ 22,917 |
Origination date | Nov. 15, 2022 | Nov. 09, 2022 |
Maturity date | May 15, 2024 | May 09, 2024 |
Interest Rate | 10% | 10% |
Notes Payable Thirteen [Member] | ||
Principal amount | $ 1,563,929 | $ 200,000 |
Debt Discount | 1,563,929 | 220,000 |
Principal | 1,563,929 | 235,400 |
Discount | $ 1,129,504 | $ 210,833 |
Origination date | Jan. 11, 2023 | Dec. 21, 2022 |
Maturity date | Oct. 11, 2023 | Dec. 21, 2023 |
Interest Rate | 14% | 7% |
DEBT (Details 2)
DEBT (Details 2) | Mar. 31, 2023 USD ($) |
DEBT | |
2023 | $ 1,994,109 |
2024 | 2,509,950 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | 20,400 |
Future maturity | 4,524,459 |
Less - Discounts | (3,403,656) |
Net future maturity | $ 1,120,803 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||||
Jan. 11, 2023 | May 29, 2020 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Oct. 03, 2014 | |
Note Interest Rate | 3.75% | 8% | ||||
Exercisable price per share | $ 0.70 | $ 1.06 | ||||
Line of credit | $ 30,000 | $ 30,000 | $ 30,000 | |||
Loans Received | $ 20,400 | |||||
Maturity note | March 2050 | |||||
Description of Monthly payments | The note requires $100 monthly payments beginning in May 2022 until maturity | |||||
Fair value outstanding amount | 30,200 | $ 42,130 | ||||
Issuance of debt discount | $ 3,808,565 | $ 0 | ||||
P C Ventures [Member] | ||||||
Exercisable price per share | $ 0.85 | |||||
Accrued and unpaid interest | $ 78,929 | |||||
Warrants purchase shares | 3,127,858 | |||||
Additional debt discount | $ 1,563,929 | |||||
Note payable balance | $ 1,563,929 | |||||
Interest rate | 14% | |||||
Warrants vested, value | $ 3,309,045 | |||||
On January 11, 2022 [Member] | ||||||
Note Interest Rate | 10% | |||||
Convertible notes payable | $ 1,485,000 | |||||
Issuance of debt discount | $ 135,000 | |||||
Description of short term debt | quarterly interest payments with the principal due at maturity on January 11, 2023 | |||||
From January 24, 2023 to March 30, 2023 [Member] | ||||||
Note Interest Rate | 14% | |||||
Convertible notes payable | $ 1,804,950 | |||||
Description of short term debt | The convertible notes, which have identical terms, require quarterly interest payments with the principal due at maturity eighteen months from issuances and are convertible at $3.20 per share of common stock | |||||
Description of warrants | the Company issued a total of 3,609,900 warrants to purchase shares of common stock exercisable at $0.85 per share | |||||
Additional discount on debt | $ 3,505,723 | |||||
Derivative liability values | 358,176 | |||||
Derivative liability values vested | $ 3,505,723 | |||||
From January 24, 2023 to March 30, 2023 [Member] | CEO Member | ||||||
Note Interest Rate | 14% | |||||
Convertible notes payable | $ 100,000 | |||||
Description of short term debt | The convertible note requires quarterly interest payments with the principal due at maturity eighteen months from issuance and is convertible at $3.20 per share of common stock | |||||
Description of warrants | the Company issued 200,000 warrants to purchase shares of common stock exercisable at $0.85 per share | |||||
Fair value of warrants | $ 209,180 | |||||
Issue of warrants | 200,000 | |||||
Additional discount on debt | $ 100,000 | |||||
Derivative liability values | $ 22,569 |
EQUITY (Details)
EQUITY (Details) - Company Warrants [Member] | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Warrants, Number of Shares begnning | shares | 3,780,000 |
Warrants, Number of Shares ending | shares | 10,517,758 |
Issued | shares | 6,737,758 |
Warrants, Weighted Average Exercise Price begnning | $ / shares | $ 0.48 |
Warrants, Weighted Average Exercise Price ending | $ / shares | 0.72 |
Issued in Period, Weighted Average Exercise Price | $ / shares | $ 0.85 |
Issued, Weighted average remaining life | 3 years 4 months 20 days |
Warrants,Weighted Average Remaining Life ending | 2 years 3 months 18 days |
Warrants,Weighted Average Remaining Life beginning | 10 months 13 days |
EQUITY (Details 1)
EQUITY (Details 1) - Company Options [Member] | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Warrants, Number of Shares begnning | shares | 5,284,068 |
Issued | shares | 500,000 |
Warrants, Number of Shares ending | shares | 5,784,068 |
Warrants, Weighted Average Exercise Price begnning | $ / shares | $ 0.80 |
Issued, Weighted Average Exercise Price | $ / shares | 0.99 |
Warrants, Weighted Average Exercise Price ending | $ / shares | $ 0.82 |
Options, Weighted Average Remaining Life beginning | 4 years 2 months 1 day |
Options, Weighted Average Remaining Life ending | 5 years |
Issued, Weighted average remaining life | 4 years 3 days |
EQUITY (Details Narrative)
EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | |||
Jan. 11, 2023 | Jan. 31, 2023 | Oct. 31, 2022 | Mar. 30, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | |
Shares of common Stock issued | 4,245 | 17,045 | ||||
Shares value of common Stock issued | $ 4,500 | $ 15,000 | ||||
Vested, number of shares | 3,153,265 | |||||
Warrant issued value | $ 119,383 | $ 2,167,081 | ||||
Warrants issued | 5,655 | |||||
Accrued interest | $ 7,589 | |||||
Options to purchase shares | 2,630,803 | |||||
Risk free interest rate, maximum | 4.94% | 4.73% | ||||
Risk free interest rate, minimum | 3.60% | 4.41% | ||||
Expected volatility rate, minimum | 97% | 164% | ||||
Expected volatility rate, maximum | 305% | 379% | ||||
Five NonExcecutive Agreement [Member] | ||||||
Stock issued options | 500,000 | |||||
Stock issued option, value | $ 448,950 | |||||
Exercise price | $ 0.99 | |||||
Options [Member] | ||||||
Risk free interest rate | 4.27% | |||||
Expected volatility rate | 277% | |||||
Fair value assumptions, expected term | 5 years | |||||
Exercise price | $ 0.99 | |||||
Warrants [Member] | ||||||
Risk free interest rate, maximum | 5% | |||||
Risk free interest rate, minimum | 3.66% | |||||
Expected volatility rate, minimum | 278% | |||||
Expected volatility rate, maximum | 346% | |||||
Exercise price | $ 0.85 | |||||
Warrants [Member] | Minimum [Member] | ||||||
Fair value assumptions, expected term | 24 months | |||||
Warrants [Member] | Maximum [Member] | ||||||
Fair value assumptions, expected term | 60 months | |||||
Note Agreement [Member] | ||||||
Warrant issued value | $ 3,309,000 | $ 3,506,000 | ||||
Warrants purchase shares | 200,000 | |||||
Warrants issued | 3,127,858 | 3,609,900 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Oct. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Warrant issued, value | $ 119,383 | $ 2,167,081 | ||
Advances payable | 1,049,872 | $ 1,069,743 | ||
Operating expenses | 1,208,148 | $ 773,528 | ||
Loutex Production Company [Member] | ||||
Advances payable | 73,000 | $ 73,000 | ||
CEO [Member] | ||||
Warrant issued, value | 209,000 | |||
Common stock percentage held | 10% | |||
Consulting expenses | 100,000 | |||
Advances payable | $ 22,154 | $ 22,154 | ||
Warrant issued | 200,000 | |||
Accrued bonus compensation | $ 150,000 | |||
CFO [Member] | ||||
Accrued bonus compensation | 115,000 | |||
P C Ventures [Member] | ||||
Advances payable | 20,000 | |||
Operating expenses | $ 20,000 | |||
Three Percent Holder [Member] | ||||
Common stock percentage held, description | individual who holds less than 5% of the Company’s common stock | |||
Advances payable | $ 11,865 | $ 11,865 | ||
Largest Shareholder [Member] | ||||
Common stock percentage held | 31% | 31% | ||
Advances payable | $ 62,500 | $ 62,500 | ||
Elysian Fields Disposal [Member] | ||||
Advances payable | 259,000 | 256,000 | ||
Operating expenses | 3,000 | |||
Michaels Consulting [Member] | ||||
Advances payable | $ 344,000 | $ 344,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
May 31, 2023 | Apr. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Exercisable price per share | $ 0.70 | $ 1.06 | ||
Options to purchase shares | 2,630,803 | |||
Accrued interest | $ 7,589 | |||
Subsequent Event [Member] | ||||
Exercisable price per share | $ 3.20 | |||
Convertible note terms, description | quarterly interest payments with the principal due at maturity eighteen months from issuances | |||
Warrants to purchase shares | 500,000 | |||
Exercise price of shares | $ 0.85 | $ 0.572 | ||
Warrants vested, value | $ 425,000 | |||
Additional debt discount | $ 93,549 | |||
Stock issued options | 58,496 | 1,350 | ||
Subsequent Event [Member] | 14% Convertible Note Payable [Member] | ||||
Exercisable price per share | $ 0.85 | |||
Options to purchase shares | 150,000 | |||
Warrants to purchase shares | 1,400,000 | |||
Options vested, value | $ 105,796 | |||
Exercise price of shares | $ 0.572 | |||
Warrants vested, value | $ 932,739 | |||
Proceeds from convertible note payable | $ 700,000 | |||
Subsequent Event [Member] | CEO [Member] | ||||
Stock issued options | 30,637 | |||
Subsequent Event [Member] | CFO [Member] | ||||
Stock issued options | 14,706 | |||
Subsequent Event [Member] | Director [Member] | ||||
Stock issued options | 18,382 | |||
Four Noteholders [Member] | Subsequent Event [Member] | ||||
Stock issued options | 7,661 | |||
Accrued interest | $ 6,995 | |||
Four Noteholders [Member] | Subsequent Event [Member] | CEO [Member] | ||||
Stock issued options | 2,815 | |||
Four Noteholders [Member] | Subsequent Event [Member] | CEO's Wife [Member] | ||||
Stock issued options | 1,350 |