CONVERTIBLE NOTES | NOTE 6 – CONVERTIBLE NOTES The following table summarizes the convertible notes as of June 30, 2024, and December 31, 2023: Put Premium June 30, December 31, On Stock Creditor 2024 2023 Settled Debt Frondeur $ 16,083 $ 123,793 $ 16,083 Kings Wharf 46,900 42,200 - 1800 Diagonal Lending 152,000 117,000 40,000 Trillium 124,000 - 124,000 Matterhorn - 8,454 - Travel Data Solutions - 125,000 - Third Party * 40,099 230,232 25,601 Total 379,083 646,679 205,684 Less: Debt discount (273,330 ) (206,570 ) Total Convertible notes payable $ 105,753 $ 440,109 Frondeur Between June 1, 2022 and December 1, 2022, the Company entered into several convertible notes with Frondeur Partners, LLC bearing interest at 10% per annum and totaling $160,000. These convertible notes are convertible between 50% and 70% of the lowest close bid price of the Company’s stock price for a twenty day period. These convertible notes were accounted for as stock settled debt in accordance with ASC 480 - “Distinguishing Liabilities from Equity”, resulting in put premiums on stock settled debt being recognized. See Note 7. During the years ended December 31, 2023 and 2022,the lender opted to convert certain portions of the note into shares of the Company’s common stock. Through March 31, 2024, the Company issued three convertible notes. The total principal amount of these notes is $30,000. They bear interest at 12% and are due in full at October 31, 2024, November 30, 2024 and December 31, 2024, respectively. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $16,083 and $123,793, respectively. Between November 1, 2021 and May 1, 2022, Cruzani entered into several convertible notes with Frondeur Partners, LLC bearing interest at 10% per annum and totaling $175,000. These convertible notes were convertible at 70% of the lowest close bid price of the Company’s stock price for a twenty day period. These convertible notes were accounted for as stock settled debt in accordance with ASC 480 - “Distinguishing Liabilities from Equity”, resulting in put premiums on stock settled debt being recognized. See Note 7. As of December 31, 2022, these convertible notes were converted into shares of the Company’s common stock. During the three months ended March 31, 2024, the Company issued three additional convertible notes to Fondeur. The aggregate principal amount of these notes is $30,000, and the notes are dated January 1, 2024 ($10,000), February 1, 2024 ($10,000) and March 1, 2024 ($10,000). They bear interest at 12% and are due in full at October 31, 2024, November 30, 2024 and December 31, 2024, respectively. During Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $16,083 and $123,793, respectively. The Company granted 150,000 warrants to purchase 150,000 shares of the Company’s common stock with these convertible notes. These warrants have an exercise price of $0.0001 and a term of five years. Kings Wharf On October 19, 2022, the Company entered into a convertible note with King Wharf Opportunities Fund bearing interest at 8% totaling $275,000. The note included an original issue discount of $25,000. This convertible note is convertible at the lesser of $0.0001 or 50% of the lowest trading price of the Company’s stock price for a thirty day period. The embedded conversion option of the convertible note contains conversion features that qualify for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. See Note 8. This convertible note is fully guaranteed by the Company’s Chief Executive Officer, Eddie Aizman, and President, Michael Lakshin. Additionally, on October 19, 2022, both Mr., Aizman and Mr. Lakshin, entered into pledge agreements in which they each have agreed to secure the Company’s payment obligations to the lender with a guaranty and a pledge of 163,461 shares of Series G preferred stock of the Company, for a total of 326,922 shares of Series G Preferred Stock. During the years ended December 31, 2023 and 2022, the lender opted to convert certain portions of the note into shares of the Company’s common stock. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $46,900 and $42,200, respectively. 1800 Diagonal Lending November 10, 2023, the Company entered into a convertible note with 1800 Diagonal Lending bearing interest at 10% totaling $77,000. This convertible note is convertible at the lesser of $0.0001 or 61% of the lowest trading price of the Company’s stock price for a thirty-day period. The embedded conversion option of the convertible note contains conversion features that quality for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. The outstanding remaining principal balances at June 30, 2024, and December 31, 2023, was $112,000 and $77,000, respectively. December 12, 2023, the Company entered into a convertible note with 1800 Diagonal Lending bearing interest at 10% totaling $40,000. This convertible note is convertible at the lesser of $0.0001 or 61% of the lowest trading price of the Company’s stock price for a thirty-day period. The embedded conversion option of the convertible note contains conversion features that quality for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. The outstanding remaining principal balances at June 30, 2024, and December 31, 2023, was $40,000 and $40,000, respectively. During the six months ended June 30, 2024, the Company entered into a convertible note with 1800 Diagonal Lending bearing interest at 10% totaling $35,000. This convertible note is convertible at the lesser of $0.0001 or 61% of the lowest trading price of the Company’s stock price for a thirty-day period. The embedded conversion option of the convertible note contains conversion features that quality for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. The outstanding remaining principal balances at June 30, 2024, and December 31, 2023, was $35,000 and $0, respectively. Trillium Between May 25, 2021 and July 6, 2021, Cruzani entered into two convertible notes with Trillium Partners, LP bearing interest at 10% per annum and totaling $44,000. These convertible notes were convertible at a fixed price of $0.0001. During the years ended December 31, 2023 and 2022, the lender opted to convert certain portions of the note into shares of the Company’s common stock. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $0 and $0. Between June 1, 2022 and December 6, 2022, the Company entered into several convertible notes with Trillium Partners, LP bearing interest between 10% and 12% per annum and totaling $332,800. These convertible notes are convertible at a fixed price between $0.0001 and $0.0002. During the years ended December 31, 2023 and 2022, the lender opted to convert certain portions of the note into shares of the Company’s common stock. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $0 and $0, respectely. On October 19, 2022, the Company entered into a convertible note with Trillium Partners, LP bearing interest at 8% totaling $275,000. The note included an original issue discount of $25,000. This convertible note is convertible at the lesser of $0.0001 or 50% of the lowest trading price of the Company’s stock price for a thirty day period. The embedded conversion option of the convertible note contains conversion features that qualify for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. See Note 8. This convertible note is fully guaranteed by the Company’s Chief Executive Officer, Eddie Aizman, and President, Michael Lakshin. Additionally, on October 19, 2022, both Mr., Aizman and Mr. Lakshin, entered into pledge agreements in which they each have agreed to secure the Company’s payment obligations to the lender with a guaranty and a pledge of 163,461 shares of Series G preferred stock of the Company, for a total of 326,922 shares of Series G Preferred Stock. During the years ended December 31, 2023 and 2022, the lender opted to convert certain portions of the note into shares of the Company’s common stock. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $62,000 and $0, respectively. During the six months ended June 30, 2024, the Company entered into four additional convertible notes with Trillium Partners, LP bearing interest of 10% to 12% totaling $62,000. These notes include original issue discounts totaling $7,000. These note have 6 months maturity dates and are convertible at the lesser of $0.0001 or 50% of the lowest trading price of the Company’s stock price for a thirty day period. The embedded conversion option of the convertible note contains conversion features that qualify for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. The remaining principal balances at June 30, 2024, and December 31, 2023, was $62,000 and $0, respectively. Matterhorn On August 15, 2023, the Company entered into a convertible note with Matterhorn Partners LLC bearing interest at 12% totaling $25,000. The note included an original issue discount of $4,000. This convertible note is convertible at the lesser of $0.0001 or 50% of the lowest trading price of the Company’s stock price for a thirty-day period. The embedded conversion option of the convertible note contains conversion features that quality for embedded derivative classification as a result of variable conversion price features, which is not a fixed discount rate. This convertible note is fully guaranteed by the Company’s Chief Executive Officer, Eddie Aizman and President, Michael Lakshin. During the years ended December 31, 2023 and 2022, the lender opted to convert certain portions of the note into shares of the Company’s common stock. Due to these conversions, the remaining principal balances at June 30, 2024, and December 31, 2023, was $ 0 and $8,454, respectively. Travel Data Solutions On November 18, 2017, Cruzani entered into a convertible promissory note for $25,000 with Travel Data Solutions, Inc., pursuant to which the Company received proceeds of $25,000. The notes are convertible at any time after September 13, 2018 at a mutually agree upon conversion price, bearing interest rate at 10% per annum and due on November 30, 2019. During January and February 2018, the Company received an additional $75,000 under the same terms as the previously issued convertible promissory note. During the year ended December 31, 2023, the balance of the note was converted into shares of the Company’s common stock. As of June 30, 2024, and December 31, 2023, the outstanding balance was $ 0 Third Party As a result of the reverse merger that occurred on May 4, 2022, as discussed in Note 1, the Company assumed convertible notes from Cruzani (1-3 below). Convertible debt outstanding during the three months ended March 31, 2024, and the year ended December 31, 2023, consist of the following: 1) Between May 20, 2020 and October 1, 2021, Cruzani entered into several convertible notes with Livingston Asset Management bearing interest at 10% per annum and totaling $331,600. These convertible notes were convertible at 70% of the lowest close bid price of the Company’s stock price for a twenty day period. These convertible notes were accounted for as stock settled debt in accordance with ASC 480 - “Distinguishing Liabilities from Equity”, resulting in put premiums on stock settled debt being recognized. As of December 31, 2022, these convertible notes were converted into shares of the Company’s common stock. 2) On November 17, 2021, Cruzani entered into a convertible note with Oscaleta Partners, LLC bearing interest at 10% per annum and totaling $11,000. This convertible note was convertible at 50% of the lowest close bid price of the Company’s stock price for a twenty day period. This convertible note was accounted for as stock settled debt in accordance with ASC 480 - “Distinguishing Liabilities from Equity”, resulting in a put premium on stock settled debt being recognized. As of December 31, 2022, the convertible note was converted into shares of the Company’s common stock. 3) On July 7, 2020, the Company issued a $84,681 convertible promissory note to a third party in exchange for $84,681. The Convertible Note bears interest at 10%, per annum. All unpaid principal and accrued interest under the Convertible Note will be due and payable in full one year from issuance. After six months from the issuance date, the Holder may elect to convert into that number of shares of common stock equal to the quotient obtained by dividing the outstanding principal balance and unpaid accrued interest under this Note by the amount equal to the anticipate public market price of the Company’s common stock multiplied by fifty percent (50%). This convertible note was accounted for as stock settled debt in accordance with ASC 480 - “Distinguishing Liabilities from Equity”, resulting in put premiums on stock settled debt being recognized. See Note 7. As of December 31, 2022, this convertible note is in default and the principal and accrued interest balance remain outstanding. During the year ended December 31, 2023, the Company had additional borrowings of $6,728. As of June 30, 2024, and December 31, 2023, the outstanding balance was $40,099 and $230,232, respectively |