Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2024 | Jun. 13, 2024 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 000-56192 | |
Entity Registrant Name | ELECTROMEDICAL TECHNOLOGIES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2619815 | |
Entity Address, Address Line One | 16413 N. 91st Street | |
Entity Address, Address Line Two | Ste. C140 | |
Entity Address, City or Town | Scottsdale | |
Entity Address State Or Province | AZ | |
Entity Address, Postal Zip Code | 85260 | |
City Area Code | 888 | |
Local Phone Number | 880-7888 | |
Title of 12(g) Security | Common Stock | |
Trading Symbol | EMED | |
Security Exchange Name | NONE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 566,111,930 | |
Entity Central Index Key | 0001715819 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 78,843 | $ 87,704 |
Accounts receivable | 3,501 | 4,399 |
Inventories | 46,561 | 68,517 |
Prepaid expenses and other current assets | 290,470 | 288,565 |
Total current assets | 419,375 | 449,185 |
Right of use asset | 137,942 | 149,493 |
Property and equipment, net | 149,705 | 149,705 |
Total assets | 707,022 | 748,383 |
Current liabilities: | ||
Accounts payable | 241,970 | 239,481 |
Credit cards payable | 27,077 | 28,097 |
Accrued expenses and other current liabilities | 603,630 | 916,971 |
Customer deposits | 185,275 | 197,325 |
Convertible promissory notes, net of discount of $0 and $375,865, respectively | 1,629,559 | 1,393,601 |
Lease liability, current portion | 50,762 | 48,745 |
Derivative liabilities- convertible promissory notes | 1,408,002 | 532,334 |
Total current liabilities | 4,146,275 | 3,356,554 |
Government debt, net of current portion | 150,000 | 150,000 |
Lease liability, net of current portion | 92,671 | 106,200 |
Other liabilities | 6,260 | 8,416 |
Total liabilities | 4,395,206 | 3,621,170 |
Commitments and contingencies (Note 10) | ||
Stockholders' deficit | ||
Common stock, $.00001 par value, 1,999,000,000 shares authorized; 486,482,787 and 463,286,208 shares outstanding at March 31, 2024 and December 31, 2023, respectively | 4,863 | 4,631 |
Additional paid-in-capital | 23,847,975 | 23,827,330 |
Accumulated deficit | (28,306,022) | (27,469,748) |
Total stockholders' deficit | (3,688,184) | (2,872,787) |
Total liabilities and stockholders' deficit | 707,022 | 748,383 |
Series A Preferred Stock | ||
Stockholders' deficit | ||
Preferred Stock | 365,000 | 365,000 |
Series B Preferred Stock | ||
Stockholders' deficit | ||
Preferred Stock | $ 400,000 | $ 400,000 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Discount on convertible promissory notes | $ 0 | $ 375,865 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 1,999,000,000 | 1,999,000,000 |
Common stock, shares outstanding | 486,482,787 | 463,286,208 |
Series A Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 1,000,000 | 1,000,000 |
Series B Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 1 | 1 |
Preferred stock, shares outstanding | 1 | 1 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
STATEMENTS OF OPERATIONS | ||
Net sales | $ 290,244 | $ 378,646 |
Cost of sales | 72,857 | 87,696 |
Gross profit | 217,387 | 290,950 |
Selling, general and administrative expenses | 372,263 | 1,552,488 |
Loss from operations | (154,876) | (1,261,538) |
Other income (expense) | ||
Interest expense | (59,320) | (388,201) |
Change in fair value of derivative liabilities | (676,374) | |
Gain on sale of fixed assets | 1,193,676 | |
Gain (loss) on derivative liabilities | (196,510) | |
Other income | 250,806 | |
Total other expense | (681,398) | 805,475 |
Net loss | (836,274) | (456,063) |
Net loss attributable to common stockholders | $ (836,274) | $ (456,063) |
Weighted average shares outstanding - basic (in shares) | 464,815,653 | 240,567,805 |
Weighted average shares outstanding - diluted (in shares) | 464,815,653 | 240,567,805 |
Weighted average loss per share - basic (in dollars per share) | $ (0.002) | $ (0.002) |
Weighted average loss per share - diluted (in dollars per share) | $ (0.002) | $ (0.002) |
STATEMENTS OF STOCKHOLDERS' DEF
STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Series A Preferred Stock Preferred Stock | Series B Preferred Stock Preferred Stock | Common Stock | Paid in Capital | Accumulated Deficit | Total |
Beginning balance at Dec. 31, 2022 | $ 365,000 | $ 1,896 | $ 22,237,300 | $ (24,825,041) | $ (2,220,845) | |
Beginning balance (in shares) at Dec. 31, 2022 | 1,000,000 | 189,784,529 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Shares issued for consulting services | $ 350 | 314,650 | 315,000 | |||
Shares issued for consulting services (in shares) | 35,000,000 | |||||
Conversion of convertible promissory note | $ 50 | 49,950 | 50,000 | |||
Conversion of convertible promissory note (In shares) | 5,000,000 | |||||
Cashless warrant exercises | $ 180 | (180) | ||||
Cashless warrant exercises (in shares) | 18,000,000 | |||||
Share issued as CEO compensation | $ 400,000 | 400,000 | ||||
Share issued as CEO compensation (in shares) | 1 | |||||
Shares issued in conjunction with settlement reset | $ 461 | 697,539 | 698,000 | |||
Shares issued in conjunction with settlement reset (in shares) | 46,102,156 | |||||
Settlement of stock-based compensation liabilities | $ 30 | 20,970 | 21,000 | |||
Settlement of stock-based compensation liabilities (in shares) | 3,000,000 | |||||
Net loss | (456,063) | (456,063) | ||||
Ending balance at Mar. 31, 2023 | $ 365,000 | $ 400,000 | $ 2,967 | 23,480,229 | (25,281,104) | (1,032,908) |
Ending balance (in shares) at Mar. 31, 2023 | 1,000,000 | 1 | 296,886,685 | |||
Increase (Decrease) in Stockholders' Equity | ||||||
Trigger warrants issued | 160,000 | 160,000 | ||||
Beginning balance at Dec. 31, 2023 | $ 365,000 | $ 400,000 | $ 4,631 | 23,827,330 | (27,469,748) | (2,872,787) |
Beginning balance (in shares) at Dec. 31, 2023 | 1,000,000 | 1 | 463,286,208 | |||
Increase (Decrease) in Stockholders' Equity | ||||||
Conversion of convertible promissory notes, accrued interest and derivative liabilities | $ 232 | 20,645 | 20,877 | |||
Conversion of convertible promissory notes, accrued interest and derivative liabilities (in Shares) | 23,196,579 | |||||
Net loss | (836,274) | (836,274) | ||||
Ending balance at Mar. 31, 2024 | $ 365,000 | $ 400,000 | $ 4,863 | $ 23,847,975 | $ (28,306,022) | $ (3,688,184) |
Ending balance (in shares) at Mar. 31, 2024 | 1,000,000 | 1 | 486,482,787 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities: | ||
Net loss | $ (836,274) | $ (456,063) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense | 715,000 | |
Depreciation and amortization | 0 | 4,557 |
Amortization of right of use asset | 11,551 | |
Amortization of debt discount and warrant expense | 320,204 | |
Change in fair value of derivative liabilities | 676,374 | |
Loss on derivatives | 196,510 | |
Gain on sale of fixed assets | (1,193,676) | |
Other | 876 | |
Change in operating assets and liabilities: | ||
Accounts receivable | 898 | 3,618 |
Inventories | 21,956 | (97,643) |
Prepaid expenses and other current assets | (1,905) | 37,670 |
Accounts payable | 2,489 | 276,900 |
Credit cards payable | (1,020) | (3,001) |
Accrued expenses and other current liabilities | (205,378) | 22,044 |
Customer deposits | (12,050) | (83,588) |
Lease liability | (11,512) | |
Other liabilities | 366 | |
Net cash used in operating activities | (158,361) | (452,736) |
Cash flows from investing activities: | ||
Sale of property and equipment | 1,894,588 | |
Net cash provided by investing activities | 1,894,588 | |
Cash flows from financing activities: | ||
Repayments on bank debt | (522,401) | |
Issuance of convertible promissory notes | 149,500 | |
Repayments on convertible promissory notes | (52,849) | |
Net cash provided by (used in) provided by financing activities | 149,500 | (575,250) |
Net increase (decrease) in cash and cash equivalents | (8,861) | 866,602 |
Cash and cash equivalents, beginning of period | 87,704 | 368,425 |
Cash and cash equivalents, end of period | 78,843 | 1,235,027 |
Cash paid during the period for: | ||
Interest | 23,227 | 22,934 |
Non-cash investing and financing activities: | ||
Settlement of stock-based compensation liabilities | 719,000 | |
Conversion of convertible promissory notes, derivatives and accrued interest into shares of common stock | $ 20,877 | $ 50,000 |
ORGANIZATION AND NATURE OF BUSI
ORGANIZATION AND NATURE OF BUSINESS | 3 Months Ended |
Mar. 31, 2024 | |
ORGANIZATION AND NATURE OF BUSINESS | |
ORGANIZATION AND NATURE OF BUSINESS | NOTE 1. ElectroMedical Technologies, LLC (“the Company”), was formed in November 2010 as an Arizona limited liability company. In August 2017, the Company converted to a Delaware C Corporation under Electromedical Technologies, Inc. The Company is a bioelectronic engineering company with medical device certifications in the United States (FDA) and Mexico (Cofepris). The Company engineers simple-to-use portable bioelectronics devices, which provide fast and long -lasting pain relief across a broad range of ailments. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2024 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. Accounting Method The accompanying unaudited financial statements of Electromedical Technologies, Inc. have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (“GAAP”) for interim financial information and in accordance with Rule 8-03 of Regulation S-X. Certain information and disclosures normally included in the annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring adjustments considered necessary for a fair presentation, have been included. We have reclassified certain amounts in prior-period financial statements to conform to the current period’s presentation. These interim financial statements should be read in conjunction with the audited annual financial statements of the Company as of and for the year ended December 31, 2023. The results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results that may be expected for the full year. 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 certain assets and liabilities, certain disclosures at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates affecting the financial statements have been prepared on the basis of the most current and best available information. However, actual results from the resolution of such estimates and assumptions may vary from those used in the preparation of the financial statements. Going Concern Since inception, the Company has incurred approximately $24.6 million of accumulated net losses. In addition, during the three months ended March 31, 2024, the Company used $158,361 in operations and had a working capital deficit of $3,726,900. These factors, among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. The Company expects to obtain funding through additional debt and equity placement offerings until it consistently achieves positive cash flows from operations. If the Company is unable to obtain additional funding, it may not be able to meet all of its obligations as they come due for the next twelve months. The continuing viability of the entity and its ability to continue as a going concern is dependent upon the entity being successful in its continuing efforts in growing its revenue base and/or accessing additional sources of capital, and/or selling assets. As a result, there is significant uncertainty whether the entity will continue as a going concern and, therefore, whether it will realize its assets and settle its liabilities and commitments in the normal course of business and at the amounts stated in the financial statements. Accordingly, no adjustments have been made to the financial statements relating to the recoverability and classification of the asset carrying amounts or the amount and classification of liabilities that might be necessary should the entity not continue as a going concern. At this time, management is of the opinion that no asset is likely to be realized for an amount less than the amount at which it is recorded in the financial statements as at March 31, 2024. Revenue Recognition Revenues are recognized in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, when performance obligations are satisfied through the transfer of promised goods to the Company’s customers. Control transfers upon shipment of product and when the title has been passed to the customers. This includes the transfer of legal title, physical possession, the risks and rewards of ownership, and customer acceptance. Revenue is recorded net of sales taxes collected from customers on behalf of taxing authorities, allowance for estimated returns, chargebacks, and markdowns based upon management’s estimates and the Company’s historical experience. The Company’s liability for sales return refunds is recognized within other current liabilities, and an asset for the value of inventory which is expected to be returned is recognized within other current assets on the balance sheets. The Company generally allows a 30 day right of return to its customers. As of both March 31, 2024 and December 31, 2023 the sales returns allowance was $6,990. Certain larger customers pay in advance for future shipments. These advance payments totaled $185,275 and $197,325 at March 31, 2024 and December 31, 2023, respectively, and are recorded as customer deposits in the accompanying balance sheets. Revenue related to these advance payments is recognized upon shipment to the distributor or the end-customer. At the completion of the initial three-year warranty, the Company sells extended warranties for periods ranging from one three years Financial Instruments and Concentrations of Business and Credit Risk The Company maintains cash balances that can, at times, exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses in these accounts and believes it is not exposed to any significant credit risk. The Company’s accounts receivable, which are unsecured, expose the Company to credit risks such as collectability and business risks such as customer concentrations. The Company mitigates credit risk by investigating the creditworthiness of all customers prior to establishing relationships with them, performing periodic review of the credit activities of those customers during the course of the business relationship, regularly analyzing the collectability of accounts receivables, and recording allowances for doubtful accounts when these receivables become uncollectible. The Company mitigates business risks by attempting to diversify its customer base. Significant customer sales as a percentage of total sales are as follows: THREE MONTHS ENDED MARCH 31, 2024 2023 Customer A 34.8 % 18.8 % Customer B 14.9 % 10.2 % Customer F 11.2 % — Amounts due these customers totaled $14,142 and $12,442 at March 31, 2024 and December 31, 2023, respectively for commissions and reimbursements. Amounts due from these customers, totaled $297 and $594 at March 31, 2024 and December 31, 2023, respectively. Customer deposits on hand from these customers totaled $58,900 and $70,950 at March 31, 2024 and December 31, 2023, respectively. The loss of these customers would have a significant impact on the operations and cash flows of the Company. The Company’s supplier concentrations expose the Company to business risks, which the Company mitigates by attempting to diversify its supply chain. Significant supplier purchases as a percentage of total inventory purchases are as follows: THREE MONTHS ENDED MARCH 31, 2024 2023 Supplier A 69.9 % 64.0 % Supplier D — 25.5 % Supplier F 17.8 % — There were no amounts outstanding due these suppliers at March 31, 2024 and December 31, 2023. The loss of key vendors may have a significant impact on the operations and cash flows of the Company. The estimated fair value of financial instruments has been determined using available market information and appropriate valuation methodologies. However, considerable judgment is often required to interpret market data used to develop the estimates of fair value. Accordingly, the estimates presented may not be indicative of the amounts the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies could have a material effect on the estimated fair value amounts. Disclosure of Fair Value The disclosure requirements within Accounting Standards Codification (ASC) Topic 820-10, Fair Value Measurement, require disclosure of estimated fair values of certain financial instruments. For financial instruments recognized at fair value in the Company’s statements of operations, the disclosure requirements of ASC Topic 820-10 also apply. The methods and assumptions are set forth below: ● Cash and cash equivalents are carried at cost, which approximates fair value. ● The carrying amounts of receivables approximate fair value due to their short-term maturities. ● The carrying amounts of payables approximate fair value due to their short-term maturities. ● Derivative liabilities are adjusted to fair value utilizing the Lattice method Asset and liabilities measured and reported at fair value are classified and disclosed in one of the following categories based on inputs: Level 1 — Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability Level 3 — Pricing inputs include significant unobservable inputs used in determining the fair value of investments. The types of investments, which would generally be included in this category include equity securities issued by private entities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment. The Company’s convertible promissory notes contain variable conversion provisions upon default, Pursuant to ASC 815-15 Embedded Derivatives, the fair values of the variable conversion options and shares to be issued were recorded as derivative liabilities on the default dates. The following table presents changes during the three months ended March 31, 2024 in Level 3 liabilities measured at fair value on a recurring basis: Fair value- December 31, 2023 $ 532,334 Derivative liabilities in conjunction with settlement of convertible promissory notes 213,957 Conversion of convertible promissory notes (14,663) Change in fair value of derivative liabilities 676,374 Fair value- March 31, 2024 $ 1,408,002 The levels of the fair value hierarchy into which the Company’s assets and liabilities fall as of March 31, 2024, are as follows: Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities – convertible promissory notes $ — $ — $ 1,408,002 $ 1,408,002 Total fair value $ — $ — $ 1,408,002 $ 1,408,002 Inventories Inventories are stated at the lower of cost or market. Cost is determined based on the first-in, first-out cost flow assumption (“FIFO”) while market is determined based upon the estimated net realizable value less an allowance for selling and distribution expenses and a normal gross profit. The Company evaluates the need for inventory reserves associated with obsolete, slow moving, and non-sellable inventory by reviewing estimated net realizable values on a periodic basis. As of March 31, 2024 and December 31, 2023, the Company believes there are no excess and obsolete inventories and accordingly, did not record an inventory reserve. Inventories consist of purchased finished goods. Sales Taxes Sales taxes for the three-month periods ended March 31, 2024 and 2023, were recorded on a net basis. Included in accrued expenses at both March 31, 2024 and December 31, 2023 is approximately $61,000 related to sales taxes. Warranty The Company warranties the sale of most of its products and records an accrual for estimated future claims. The standard warranty is typically for a period of three years Lease Commitment The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. Lease expense for variable lease components are recognized when the obligation is probable. Operating lease right of use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease payments are recognized as lease expense on a straight-line basis over the lease term. ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As an implicit interest rate is not readily determinable in the Company’s lease, the incremental borrowing rate is used based on the information available at commencement date in determining the present value of lease payments. The lease term for the Company’s lease includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. The Option for the lease renewal has been excluded from the lease term (and lease liability) for the Company’s lease as the reasonably certain threshold is not met. Lease payments included in the measurement of the lease liability are comprised of fixed payments, variable payments that depend on index or rate, and amounts probable to be payable under the exercise of the Company option to purchase the underlying asset if reasonably certain. Variable lease payments not dependent on a rate or index associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed as probable. Variable lease payments are presented as operating expenses in the Company’s statement of operations in the same line as expense arising from fixed lease payments. As of March 31, 2024, management determined that there were no variable lease costs. Net Loss per Share Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. As all potentially dilutive securities are anti-dilutive as of March 31, 2024 and December 31, 2023, diluted net loss per share is the same as basic net loss per share for each period. Conversion of outstanding warrants, certain accrued liabilities and convertible promissory notes at March 31, 2024 may result in an estimated 1,690,762,268 additional shares of common stock outstanding. At March 31, 2024, there are 1,999,000,000 common shares authorized and 486,482,787 outstanding. Management has agreed to amend its shares outstanding to meet the future requirements resulting from any of the above conversions. COVID-19 On January 30, 2020, the World Health Organization declared the COVID-19 outbreak a “Public Health Emergency of International Concern” and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the COVID-19 include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. COVID-19, and actions taken to mitigate it, have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. While it is unknown how long these conditions will last and what the complete financial effect will be to the company, COVID-19 has had an adverse effect on our business, including our supply chains and distribution systems. While we are taking diligent steps to mitigate disruptions to our supply chain, we are unable to predict the extent or nature of these impacts at this time to our future financial condition and results of operations. Recently Issued Accounting Pronouncements Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2024 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | NOTE 3. Property and equipment consisted of the following as of: March 31, December 31, 2024 2023 Building $ — $ — Tooling 149,705 149,705 Furniture and equipment 24,987 24,987 174,692 174,692 Less: accumulated depreciation and amortization (24,987) (24,987) $ 149,705 $ 149,705 On March 15, 2023, the Company entered into an agreement to sell the building of its principal offices at a purchase price of $2 million and net proceeds of $1,363,818, upon repayment in full of the Company’s bank debt. The sale resulted in a realized gain of $1,193,676, which has been recorded as other income on the accompanying statement of operations. Depreciation and amortization expense related to property and equipment was $0 and $4,557 the three months ended March 31, 2024 and 2023, respectively. Depreciation and amortization are included in selling, general and administrative expenses on the accompanying statements of operations. |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2024 | |
NOTES PAYABLE | |
NOTES PAYABLE | NOTE 4. Convertible Promissory Notes The aggregate of convertible promissory notes is as follows: March 31, December 31, Convertible promissory notes 2024 2023 Principal balance $ 1,648,204 $ 1,393,601 Debt discount balance (18,645) — Net Notes balance $ 1,629,559 $ 1,393,601 The Net Notes balance at March 31, 2024 is comprised of the following: Principal Debt Discount Net Pre 2020 $ 50,000 $ — $ 50,000 October 2021 90,639 — 90,639 February 2022 29,573 — 29,573 March 2022 305,501 — 305,501 August 2022 105,500 — 105,500 September 2022 917,491 — 917,491 March 2024 149,500 (18,645) 130,855 $ 1,648,204 $ (18,645) $ 1,629,559 The Net Notes balance at December 31, 2023 is comprised of the following: Principal Debt Discount Net Pre 2020 $ 50,000 $ — $ 50,000 October 2021 73,336 — 73,336 February 2022 44,882 — 44,882 March 2022 305,500 — 305,500 August 2022 105,500 — 105,500 September 2022 814,383 — 814,383 $ 1,393,601 $ — $ 1,393,601 In March, 2024, the Company entered into a settlement agreement with one of its lenders for amounts in default under the October 2021, February 2022 and September 2022 convertible promissory notes. The settlement agreements have been accounted for as a debt modification. (See Note 6). Principal of $932,601 and accrued interest of $128,763 are covered by the agreement and subject to the following settlement terms: ● Any and all outstanding warrants are to be cancelled without consideration. ● The maturity date has been extended to September 25, 2025 . ● Interest rate is capped at 12% per annum. ● Default penalties accrued up to the settlement date are no longer due and from the effective date forward are amended to 115% from 125% . Accrued default penalties totaling $251,000 and outstanding at December 31, 2023 have been reversed and recorded as other income in the Company’s statement of operations for the three months ended March 31, 2024. ● All payments will be applied first to outstanding principal and will include the note holders’ pro-rata share of $600 per unit, from futures sales of the Company’s Wellness ProPlus Infinity units. ● Conversions of outstanding principal are limited to $30,000 per calendar month through December 31, 2024 and may be waived under certain conditions and after such date. As of March 31, 2024, and separately, the Company is in default of two matured convertible promissory notes, including defaults resulting from the Company’s sale of its real property on March 15, 2023, issued to two lenders on March 10, 2022, and August 8, 2022, with principal and interest due in the amounts of $342,070 and $145,354, respectively. The convertible notes included a cross-default and a cross-default provision which required the Company to remit payment of principal, accrued interest, default interest, and legal fees, multiplied by 125% and 150%, respectively. The amount of $158,000 in default penalties has been accrued and is recorded in the Company’s balance sheet as of March 31,2024, for these lenders. On April 3, 2024, the Company entered into a settlement agreement with the lender of the March 10,2022 convertible promissory note. The Company is in negotiations with the other lender to reform the note in default. See Note 11. In March 2024, the Company borrowed $149,500 in conjunction with an unsecured promissory note with an investor. Proceeds of $130,000 include an original issue discount of $19,500. An up-front interest charge at twelve percent (12%) of the principal will be added to the principal balance for an outstanding balance of $167,440 to be paid in nine monthly payments of $18,604 beginning April 15, 2024. The note matures on December 15, 2024. At any time following an event of default, the investor shall have the right, to convert all or any part of the outstanding and unpaid amount of the note into fully paid and non-assessable shares of common stock. The note may be converted at a 35% discount to trading prices during the 10 days prior to conversion. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Mar. 31, 2024 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | NOTE 5. Government Debt In June 2020, the Company received a $150,000 economic injury disaster loan (“EIDL”). The loan accrues interest at a rate of 3.75% annually and is collateralized by all personal property and intangible assets of the Company. The loan has a 30-month moratorium on payments, after which monthly principal and interest payments of $731 will be made through the maturity date of June 2050. Interest expense totaled $1,402 and $1,387 for the three months ended March 31, 2024 and 2023, respectively. |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
DERIVATIVE LIABILITIES | |
DERIVATIVE LIABILITIES | NOTE 6. DERIVATIVE LIABILITIES The Company’s convertible promissory notes contain variable conversion provisions upon default, Pursuant to ASC 815-15 Embedded Derivatives, the fair values of the variable conversion options and shares to be issued were recorded as derivative liabilities on the default dates. In March,2024, the Company entered into a settlement agreement with one of its lenders for amounts in default under the October 2021, February 2022 and September 2022 convertible promissory notes. The settlement agreement resulted in a net increase in derivative liabilities totaling $213,957 which has been recorded as a loss on derivative liabilities in the Company’s statement of operations. Based on the various convertible promissory notes described in Note 4, the fair value of applicable derivative liabilities on notes and the change in fair value of derivative liabilities are as follows for the three months ended March 31, 2024: Fair value- December 31, 2023 $ 532,334 Derivative liabilities in conjunction with settlement of convertible promissory notes 213,957 Conversion of convertible promissory notes (14,663) Change in fair value of derivative liabilities 676,374 Fair value- March 31, 2024 $ 1,408,002 The fair value of the derivative liabilities – convertible promissory notes is estimated using a Lattice pricing model with the following assumptions: 2023 Market value of common stock $ 0.0009 Expected volatility 181.2-200.3 % Expected term (in years) 0.27-1.5 Risk-free interest rate 4.91-4.98 % |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 7. In January 2023, the Company issued one share of Series B Preferred stock to the Company’s CEO. Compensation expense of $400,000 has been recorded as selling, general and administrative expense in the accompanying statement of operations. The fair value of the Series B Preferred stock was calculated in accordance with fair value defined by the Financial Accounting Standards Board (“FASB”) in ASC 820 – Fair Value Measurements and Disclosures (“ASC 820”) based on the market approach. The Company paid the Company’s CEO a bonus of $0 and $10,000 during the three months ended March 31,2024 and 2023, respectively. Effective July 15, 2023, the Company’s board of directors executed a resolution whereby the CEO’s salary shall be reduced from $365,000 to $265,000 per year, with unpaid sums being accrued on the books of the Company and subject to an option in favor of the CEO to elect to convert the unpaid sums into shares of Company common stock. Accrued salary totaling $64,154 has been recorded as of March 31, 2024 and may be converted at any time into shares of the Company’s common stock at a discount of 25% of the market value on the date of conversion. In February 2023, the Company entered into a one-year consulting agreement under the Company’s Employee and Consultant Stock Ownership Plan, with an advisor and director in exchange for compensation of 35 million shares of common stock at a basis of $0.01 per share. The value of the compensation totaling $315,000 has been recorded in selling, general and administrative expenses in the Company’s statement of operations. The fair market value of the shares was determined based on the Company’s closing price on the date of issuance. The agreement includes a registration requirement. Compensation totaling $5,000 per month has been recorded for the advisor as board of director fees for the three months ended March 31, 2023.On July 1, 2023, the advisor resigned from the board. Compensation totaling $5,000 per month has been recorded for an employee as board of director fees for the three -month period ended March 31, 2024. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 3 Months Ended |
Mar. 31, 2024 | |
STOCKHOLDERS' DEFICIT | |
STOCKHOLDERS' DEFICIT | NOTE 8. During the three months ended March 31, 2024, holders of convertible promissory notes converted $23,661 of principal into 23,196,579 shares of common stock at $0.00102 per share. |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 3 Months Ended |
Mar. 31, 2024 | |
STOCK OPTIONS AND WARRANTS | |
STOCK OPTIONS AND WARRANTS | NOTE 9. Stock Options In 2017, the Company’s Board of Directors approved the 2017 Employee and Consultant Stock Ownership Plan, (the “Plan”). The Plan provides that the Board of Directors may grant stock units, incentive stock options and non-statutory stock options to officers, key employees and certain consultants and advisors to the Company up to a maximum of 50,000,000 shares. Stock options granted under the Plan have ten-year terms with vesting terms to be determined by the administrator of the Plan. Stock unit grant terms will be set by the administrator and at the discretion of the administrator, be settled in cash, shares, or a combination of both. All options have expired. No options were granted during the three months ended March 31, 2024. Warrants As of March 31, 2024, 160,500,000 outstanding warrants were cancelled without consideration in conjunction with a settlement agreement. See Note 4. The following table summarizes the information with respect to outstanding warrants to purchase common stock of the Company, all of which were exercisable at March 31, 2024: Date Issued Exercise Price Number Outstanding Expiration Date May 1, 2020 $ 0.52 100,000 May 1, 2025 October 1, 2021 $ 0.025 9,000,000 October 1, 2026 October 17, 2021 $ 0.025 450,000 October 17, 2024 August 10, 2022 $ 0.00102 3,336,843 August 10, 2027 September 29, 2022 $ 0.00102 2,780,690 September 29,2027 February 11, 2023 $ 0.00102 500,000 February 11, 2028 16,167,533 The following table summarizes the information with respect to outstanding warrants to purchase common stock of the Company, all of which were exercisable at December 31, 2023: Date Issued Exercise Price Number Outstanding Expiration Date December 1, 2018 $ 0.00102 170,898 December 1, 2023 May 1, 2020 $ 0.52 100,000 May 1, 2025 October 1, 2021 $ 0.025 9,000,000 October 1, 2026 October 17, 2021 $ 0.025 450,000 October 17, 2024 August 10, 2022 $ 0.00102 3,336,843 August 10, 2027 September 29, 2022 $ 0.00102 2,780,690 September 29,2027 February 11, 2023 $ 0.00102 500,000 February 11, 2028 March 10, 2023 $ 0.00102 12,500,000 March 10, 2028 September 15, 2023 $ 0.00102 148,000,000 September 15, 2026 176,838,431 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 10. Commitments The Company has entered into a product development agreement with remaining payments totaling approximately $300,000. The agreement requires that approximately $150,000 of the payments be made in conjunction with certain development milestones which the Company expects to meet over the next twelve months. The remainder is to be paid in conjunction with future new product sales. In September 2023, the Company entered into an operating lease for its office location. The lease provides for a base rent of $5,280 per month through September 30, 2026. The lease may be renewed for one three-year period. At inception of the lease, the Company recorded a right of use asset and liability. The Company used an effective borrowing rate of 12.4% within the calculation. Rent expense totaled $16,236 under the current lease during the three months ended March 31, 2024. The following outlines the maturities of our operating lease liabilities for the periods ending March 31, 2025 $ 65,757 2026 $ 67,730 2027 $ 34,366 Total lease payments $ 167,853 Less imputed interest $ (24,420) Total $ 143,433 Contingencies The Company is subject to various loss contingencies and assessments arising in the normal course of the business, some of which relate to litigation, claims, property taxes, and sales and use tax or goods and services tax assessments. The Company considers the likelihood of the loss or the incurrence of a liability, as well as its ability to reasonably estimate the amount of loss in determining loss contingencies and assessments. An estimated loss contingency or assessment is accrued when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Management regularly evaluates current information available to them to determine whether such accruals should be adjusted. Currently, there are no pending court actions, or arbitration claims filed against the company that may reasonably be determined, as of the date of this filing, to exceed $5,000 individually or in the aggregate. As of March 31, 2024, the Company is in default of two matured convertible promissory notes, including defaults resulting from the Company’s sale of its real property on March 15, 2023, issued to two lenders on March 10, 2022, and August 8, 2022, with principal and interest due in the amounts of $342,070 and $145,354, respectively. The convertible notes included a cross-default and a cross-default provision which required the Company to remit payment of principal, accrued interest, default interest, and legal fees, multiplied by 125% and 150%, respectively. The amount of $158,000 in default penalties has been accrued and recorded in the Company’s balance sheet as of March 31,2024, for these lenders. On April 3, 2024, the Company entered into a settlement agreement with the lender of the March 10,2022 convertible promissory note. The Company is in negotiations with the other lender to reform the note in default. See Note 11. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2024 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 11. The Company has evaluated subsequent events that have occurred through the date of this filing and determined that there were no subsequent events or transactions that required recognition or disclosure in the financial statements, except as disclosed below. On April 3, 2024, the Company entered into a settlement agreement with the lender of the March 10,2022 convertible promissory note. Principal of $305,501 and accrued interest of $36,971 are covered by the agreement and subject to the following settlement terms: ● Any and all outstanding warrants are to be cancelled without consideration. ● The maturity date has been extended to September 25, 2025 . ● Interest rate is capped at 12% per annum. ● Default penalties accrued up to the settlement date are no longer due and from the effective date forward are amended to 115% from 125% . ● All payments will be applied first to outstanding principal and will include the note holders’ pro-rata share of $400 per unit, from futures sales of the Company’s Wellness ProPlus Infinity units. ● Conversions of outstanding principal are limited to $30,000 per calendar month through December 31, 2024, and may be waived under certain conditions and after such date. As of June 15, 2024, holders of convertible promissory notes converted $81,222 of principal into 79,629,143 shares of common stock at $0.00102 per share. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Accounting Method | Accounting Method The accompanying unaudited financial statements of Electromedical Technologies, Inc. have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (“GAAP”) for interim financial information and in accordance with Rule 8-03 of Regulation S-X. Certain information and disclosures normally included in the annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring adjustments considered necessary for a fair presentation, have been included. We have reclassified certain amounts in prior-period financial statements to conform to the current period’s presentation. These interim financial statements should be read in conjunction with the audited annual financial statements of the Company as of and for the year ended December 31, 2023. The results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results that may be expected for the full year. |
Use of Estimates | 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 certain assets and liabilities, certain disclosures at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates affecting the financial statements have been prepared on the basis of the most current and best available information. However, actual results from the resolution of such estimates and assumptions may vary from those used in the preparation of the financial statements. |
Going Concern | Going Concern Since inception, the Company has incurred approximately $24.6 million of accumulated net losses. In addition, during the three months ended March 31, 2024, the Company used $158,361 in operations and had a working capital deficit of $3,726,900. These factors, among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. The Company expects to obtain funding through additional debt and equity placement offerings until it consistently achieves positive cash flows from operations. If the Company is unable to obtain additional funding, it may not be able to meet all of its obligations as they come due for the next twelve months. The continuing viability of the entity and its ability to continue as a going concern is dependent upon the entity being successful in its continuing efforts in growing its revenue base and/or accessing additional sources of capital, and/or selling assets. As a result, there is significant uncertainty whether the entity will continue as a going concern and, therefore, whether it will realize its assets and settle its liabilities and commitments in the normal course of business and at the amounts stated in the financial statements. Accordingly, no adjustments have been made to the financial statements relating to the recoverability and classification of the asset carrying amounts or the amount and classification of liabilities that might be necessary should the entity not continue as a going concern. At this time, management is of the opinion that no asset is likely to be realized for an amount less than the amount at which it is recorded in the financial statements as at March 31, 2024. |
Revenue Recognition | Revenue Recognition Revenues are recognized in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, when performance obligations are satisfied through the transfer of promised goods to the Company’s customers. Control transfers upon shipment of product and when the title has been passed to the customers. This includes the transfer of legal title, physical possession, the risks and rewards of ownership, and customer acceptance. Revenue is recorded net of sales taxes collected from customers on behalf of taxing authorities, allowance for estimated returns, chargebacks, and markdowns based upon management’s estimates and the Company’s historical experience. The Company’s liability for sales return refunds is recognized within other current liabilities, and an asset for the value of inventory which is expected to be returned is recognized within other current assets on the balance sheets. The Company generally allows a 30 day right of return to its customers. As of both March 31, 2024 and December 31, 2023 the sales returns allowance was $6,990. Certain larger customers pay in advance for future shipments. These advance payments totaled $185,275 and $197,325 at March 31, 2024 and December 31, 2023, respectively, and are recorded as customer deposits in the accompanying balance sheets. Revenue related to these advance payments is recognized upon shipment to the distributor or the end-customer. At the completion of the initial three-year warranty, the Company sells extended warranties for periods ranging from one three years |
Financial Instruments and Concentrations of Business and Credit Risk | Financial Instruments and Concentrations of Business and Credit Risk The Company maintains cash balances that can, at times, exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses in these accounts and believes it is not exposed to any significant credit risk. The Company’s accounts receivable, which are unsecured, expose the Company to credit risks such as collectability and business risks such as customer concentrations. The Company mitigates credit risk by investigating the creditworthiness of all customers prior to establishing relationships with them, performing periodic review of the credit activities of those customers during the course of the business relationship, regularly analyzing the collectability of accounts receivables, and recording allowances for doubtful accounts when these receivables become uncollectible. The Company mitigates business risks by attempting to diversify its customer base. Significant customer sales as a percentage of total sales are as follows: THREE MONTHS ENDED MARCH 31, 2024 2023 Customer A 34.8 % 18.8 % Customer B 14.9 % 10.2 % Customer F 11.2 % — Amounts due these customers totaled $14,142 and $12,442 at March 31, 2024 and December 31, 2023, respectively for commissions and reimbursements. Amounts due from these customers, totaled $297 and $594 at March 31, 2024 and December 31, 2023, respectively. Customer deposits on hand from these customers totaled $58,900 and $70,950 at March 31, 2024 and December 31, 2023, respectively. The loss of these customers would have a significant impact on the operations and cash flows of the Company. The Company’s supplier concentrations expose the Company to business risks, which the Company mitigates by attempting to diversify its supply chain. Significant supplier purchases as a percentage of total inventory purchases are as follows: THREE MONTHS ENDED MARCH 31, 2024 2023 Supplier A 69.9 % 64.0 % Supplier D — 25.5 % Supplier F 17.8 % — There were no amounts outstanding due these suppliers at March 31, 2024 and December 31, 2023. The loss of key vendors may have a significant impact on the operations and cash flows of the Company. The estimated fair value of financial instruments has been determined using available market information and appropriate valuation methodologies. However, considerable judgment is often required to interpret market data used to develop the estimates of fair value. Accordingly, the estimates presented may not be indicative of the amounts the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies could have a material effect on the estimated fair value amounts. Disclosure of Fair Value The disclosure requirements within Accounting Standards Codification (ASC) Topic 820-10, Fair Value Measurement, require disclosure of estimated fair values of certain financial instruments. For financial instruments recognized at fair value in the Company’s statements of operations, the disclosure requirements of ASC Topic 820-10 also apply. The methods and assumptions are set forth below: ● Cash and cash equivalents are carried at cost, which approximates fair value. ● The carrying amounts of receivables approximate fair value due to their short-term maturities. ● The carrying amounts of payables approximate fair value due to their short-term maturities. ● Derivative liabilities are adjusted to fair value utilizing the Lattice method Asset and liabilities measured and reported at fair value are classified and disclosed in one of the following categories based on inputs: Level 1 — Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability Level 3 — Pricing inputs include significant unobservable inputs used in determining the fair value of investments. The types of investments, which would generally be included in this category include equity securities issued by private entities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment. The Company’s convertible promissory notes contain variable conversion provisions upon default, Pursuant to ASC 815-15 Embedded Derivatives, the fair values of the variable conversion options and shares to be issued were recorded as derivative liabilities on the default dates. The following table presents changes during the three months ended March 31, 2024 in Level 3 liabilities measured at fair value on a recurring basis: Fair value- December 31, 2023 $ 532,334 Derivative liabilities in conjunction with settlement of convertible promissory notes 213,957 Conversion of convertible promissory notes (14,663) Change in fair value of derivative liabilities 676,374 Fair value- March 31, 2024 $ 1,408,002 The levels of the fair value hierarchy into which the Company’s assets and liabilities fall as of March 31, 2024, are as follows: Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities – convertible promissory notes $ — $ — $ 1,408,002 $ 1,408,002 Total fair value $ — $ — $ 1,408,002 $ 1,408,002 |
Inventories | Inventories Inventories are stated at the lower of cost or market. Cost is determined based on the first-in, first-out cost flow assumption (“FIFO”) while market is determined based upon the estimated net realizable value less an allowance for selling and distribution expenses and a normal gross profit. The Company evaluates the need for inventory reserves associated with obsolete, slow moving, and non-sellable inventory by reviewing estimated net realizable values on a periodic basis. As of March 31, 2024 and December 31, 2023, the Company believes there are no excess and obsolete inventories and accordingly, did not record an inventory reserve. Inventories consist of purchased finished goods. |
Sales Taxes | Sales Taxes Sales taxes for the three-month periods ended March 31, 2024 and 2023, were recorded on a net basis. Included in accrued expenses at both March 31, 2024 and December 31, 2023 is approximately $61,000 related to sales taxes. |
Warranty | Warranty The Company warranties the sale of most of its products and records an accrual for estimated future claims. The standard warranty is typically for a period of three years |
Lease Commitment | Lease Commitment The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. Lease expense for variable lease components are recognized when the obligation is probable. Operating lease right of use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease payments are recognized as lease expense on a straight-line basis over the lease term. ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As an implicit interest rate is not readily determinable in the Company’s lease, the incremental borrowing rate is used based on the information available at commencement date in determining the present value of lease payments. The lease term for the Company’s lease includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. The Option for the lease renewal has been excluded from the lease term (and lease liability) for the Company’s lease as the reasonably certain threshold is not met. Lease payments included in the measurement of the lease liability are comprised of fixed payments, variable payments that depend on index or rate, and amounts probable to be payable under the exercise of the Company option to purchase the underlying asset if reasonably certain. Variable lease payments not dependent on a rate or index associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed as probable. Variable lease payments are presented as operating expenses in the Company’s statement of operations in the same line as expense arising from fixed lease payments. As of March 31, 2024, management determined that there were no variable lease costs. |
Net Loss per Share | Net Loss per Share Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. As all potentially dilutive securities are anti-dilutive as of March 31, 2024 and December 31, 2023, diluted net loss per share is the same as basic net loss per share for each period. Conversion of outstanding warrants, certain accrued liabilities and convertible promissory notes at March 31, 2024 may result in an estimated 1,690,762,268 additional shares of common stock outstanding. At March 31, 2024, there are 1,999,000,000 common shares authorized and 486,482,787 outstanding. Management has agreed to amend its shares outstanding to meet the future requirements resulting from any of the above conversions. |
COVID-19 | COVID-19 On January 30, 2020, the World Health Organization declared the COVID-19 outbreak a “Public Health Emergency of International Concern” and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the COVID-19 include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. COVID-19, and actions taken to mitigate it, have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. While it is unknown how long these conditions will last and what the complete financial effect will be to the company, COVID-19 has had an adverse effect on our business, including our supply chains and distribution systems. While we are taking diligent steps to mitigate disruptions to our supply chain, we are unable to predict the extent or nature of these impacts at this time to our future financial condition and results of operations. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of significant customer sales as a percentage of total sales | THREE MONTHS ENDED MARCH 31, 2024 2023 Customer A 34.8 % 18.8 % Customer B 14.9 % 10.2 % Customer F 11.2 % — |
Schedules of supplier purchases as percentage of total inventory purchases | THREE MONTHS ENDED MARCH 31, 2024 2023 Supplier A 69.9 % 64.0 % Supplier D — 25.5 % Supplier F 17.8 % — |
Schedule of level 3 liabilities measured at fair value on a recurring basis | Fair value- December 31, 2023 $ 532,334 Derivative liabilities in conjunction with settlement of convertible promissory notes 213,957 Conversion of convertible promissory notes (14,663) Change in fair value of derivative liabilities 676,374 Fair value- March 31, 2024 $ 1,408,002 |
Schedule of fair value hierarchy of assets and liabilities | Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities – convertible promissory notes $ — $ — $ 1,408,002 $ 1,408,002 Total fair value $ — $ — $ 1,408,002 $ 1,408,002 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
PROPERTY AND EQUIPMENT | |
Schedule of property and equipment | March 31, December 31, 2024 2023 Building $ — $ — Tooling 149,705 149,705 Furniture and equipment 24,987 24,987 174,692 174,692 Less: accumulated depreciation and amortization (24,987) (24,987) $ 149,705 $ 149,705 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
NOTES PAYABLE | |
Schedule of convertible promissory note | March 31, December 31, Convertible promissory notes 2024 2023 Principal balance $ 1,648,204 $ 1,393,601 Debt discount balance (18,645) — Net Notes balance $ 1,629,559 $ 1,393,601 The Net Notes balance at March 31, 2024 is comprised of the following: Principal Debt Discount Net Pre 2020 $ 50,000 $ — $ 50,000 October 2021 90,639 — 90,639 February 2022 29,573 — 29,573 March 2022 305,501 — 305,501 August 2022 105,500 — 105,500 September 2022 917,491 — 917,491 March 2024 149,500 (18,645) 130,855 $ 1,648,204 $ (18,645) $ 1,629,559 The Net Notes balance at December 31, 2023 is comprised of the following: Principal Debt Discount Net Pre 2020 $ 50,000 $ — $ 50,000 October 2021 73,336 — 73,336 February 2022 44,882 — 44,882 March 2022 305,500 — 305,500 August 2022 105,500 — 105,500 September 2022 814,383 — 814,383 $ 1,393,601 $ — $ 1,393,601 |
DERIVATIVE LIABILITIES (Tables)
DERIVATIVE LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
DERIVATIVE LIABILITIES | |
Schedule of fair value of derivative liabilities | Fair value- December 31, 2023 $ 532,334 Derivative liabilities in conjunction with settlement of convertible promissory notes 213,957 Conversion of convertible promissory notes (14,663) Change in fair value of derivative liabilities 676,374 Fair value- March 31, 2024 $ 1,408,002 |
Schedule of fair value of the derivative liabilities - convertible promissory notes | 2023 Market value of common stock $ 0.0009 Expected volatility 181.2-200.3 % Expected term (in years) 0.27-1.5 Risk-free interest rate 4.91-4.98 % |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
STOCK OPTIONS AND WARRANTS | |
Summary of outstanding warrants to purchase common stock | The following table summarizes the information with respect to outstanding warrants to purchase common stock of the Company, all of which were exercisable at March 31, 2024: Date Issued Exercise Price Number Outstanding Expiration Date May 1, 2020 $ 0.52 100,000 May 1, 2025 October 1, 2021 $ 0.025 9,000,000 October 1, 2026 October 17, 2021 $ 0.025 450,000 October 17, 2024 August 10, 2022 $ 0.00102 3,336,843 August 10, 2027 September 29, 2022 $ 0.00102 2,780,690 September 29,2027 February 11, 2023 $ 0.00102 500,000 February 11, 2028 16,167,533 The following table summarizes the information with respect to outstanding warrants to purchase common stock of the Company, all of which were exercisable at December 31, 2023: Date Issued Exercise Price Number Outstanding Expiration Date December 1, 2018 $ 0.00102 170,898 December 1, 2023 May 1, 2020 $ 0.52 100,000 May 1, 2025 October 1, 2021 $ 0.025 9,000,000 October 1, 2026 October 17, 2021 $ 0.025 450,000 October 17, 2024 August 10, 2022 $ 0.00102 3,336,843 August 10, 2027 September 29, 2022 $ 0.00102 2,780,690 September 29,2027 February 11, 2023 $ 0.00102 500,000 February 11, 2028 March 10, 2023 $ 0.00102 12,500,000 March 10, 2028 September 15, 2023 $ 0.00102 148,000,000 September 15, 2026 176,838,431 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of maturities of our operating lease liabilities | The following outlines the maturities of our operating lease liabilities for the periods ending March 31, 2025 $ 65,757 2026 $ 67,730 2027 $ 34,366 Total lease payments $ 167,853 Less imputed interest $ (24,420) Total $ 143,433 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Going Concern (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Accumulated net losses | $ 24,600,000 | |
Cash used in operating activities | (158,361) | $ (452,736) |
Working capital deficit | $ 3,726,900 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Right of return period | 30 days | |
Sales returns allowance | $ 6,990 | $ 6,990 |
Customer deposits | $ 185,275 | 197,325 |
Initial warranty period | 3 years | |
Deferred revenue | $ 17,424 | $ 20,787 |
Minimum | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Extended warranty period | 1 year | |
Maximum | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Extended warranty period | 3 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Financial Instruments and Concentrations of Business and Credit Risk (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Amount due from customers | $ 14,142 | $ 12,442 | |
Due from customers | 297 | 594 | |
Customer deposits on hand | $ 58,900 | 70,950 | |
Net Sales | Customer A | Customer concentration | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Concentration risk percentage | 34.80% | 18.80% | |
Net Sales | Customer B | Customer concentration | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Concentration risk percentage | 14.90% | 10.20% | |
Net Sales | Customer F | Customer concentration | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Concentration risk percentage | 11.20% | ||
Net purchase | Supplier concentrations | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Amount due to suppliers | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Supplier Purchases as a Percentage of Total Inventory Purchases (Details) - Purchases - Supplier concentrations | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Supplier A | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Concentration risk percentage | 69.90% | 64% |
Supplier D | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Concentration risk percentage | 25.50% | |
Supplier F | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Concentration risk percentage | 17.80% |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Sales tax payable | $ 61,000 | $ 61,000 |
Standard warranty period | 3 years | |
Warranty liability | $ 15,595 | $ 16,642 |
Variable lease cost | $ 0 | |
Additional shares of common stock outstanding | 1,690,762,268 | |
Common stock, shares authorized | 1,999,000,000 | 1,999,000,000 |
Common stock, shares outstanding | 486,482,787 | 463,286,208 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Changes in Level 3 liabilities measured at fair value on a recurring basis (Details) | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Liabilities measured at fair value on a recurring basis | |
Fair value, Beginning balance | $ 532,334 |
Derivative liabilities in conjunction with settlement of convertible promissory notes | 213,957 |
Conversion of convertible promissory notes | (14,663) |
Change in fair value of derivative liabilities | $ 676,374 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change In Fair Value Of Derivative Liabilities |
Fair value, Ending balance | $ 1,408,002 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Disclosure of Fair Value (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Derivative liabilities- convertible promissory notes | $ 1,408,002 | $ 532,334 |
Total fair value | 1,408,002 | |
Level 1 | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Derivative liabilities- convertible promissory notes | 0 | |
Total fair value | 0 | |
Level 2 | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Derivative liabilities- convertible promissory notes | 0 | |
Total fair value | 0 | |
Level 3 | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Derivative liabilities- convertible promissory notes | 1,408,002 | |
Total fair value | $ 1,408,002 |
PROPERTY AND EQUIPMENT - Summar
PROPERTY AND EQUIPMENT - Summary of Property and Equipment (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
PROPERTY AND EQUIPMENT | ||
Total | $ 174,692 | $ 174,692 |
Less: accumulated depreciation and amortization | (24,987) | (24,987) |
Property and equipment | 149,705 | 149,705 |
Tooling | ||
PROPERTY AND EQUIPMENT | ||
Total | 149,705 | 149,705 |
Furniture and equipment | ||
PROPERTY AND EQUIPMENT | ||
Total | $ 24,987 | $ 24,987 |
PROPERTY AND EQUIPMENT - Additi
PROPERTY AND EQUIPMENT - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 15, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
PROPERTY AND EQUIPMENT | |||
Sale of property and equipment | $ 1,894,588 | ||
Gain on sale of fixed asset | $ 1,193,676 | 1,193,676 | |
Depreciation and amortization expense | $ 0 | $ 4,557 | |
Bank debt | Building | |||
PROPERTY AND EQUIPMENT | |||
Proceeds from sale of building | 2,000,000 | ||
Sale of property and equipment | $ 1,363,818 |
NOTES PAYABLE - Convertible pro
NOTES PAYABLE - Convertible promissory notes (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
NOTES PAYABLE | ||
Principal balance | $ 1,648,204 | $ 1,393,601 |
Debt discount balance | (18,645) | |
Net Notes balance | $ 1,629,559 | $ 1,393,601 |
NOTES PAYABLE - Net Notes balan
NOTES PAYABLE - Net Notes balance (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
NOTES PAYABLE | ||
Principal | $ 1,648,204 | $ 1,393,601 |
Debt discount balance | (18,645) | |
Net | 1,629,559 | 1,393,601 |
Pre 2020 | ||
NOTES PAYABLE | ||
Principal | 50,000 | 50,000 |
Net | 50,000 | 50,000 |
October 2021 | ||
NOTES PAYABLE | ||
Principal | 90,639 | 73,336 |
Net | 90,639 | 73,336 |
February 2022 | ||
NOTES PAYABLE | ||
Principal | 29,573 | 44,882 |
Net | 29,573 | 44,882 |
March 2022 | ||
NOTES PAYABLE | ||
Principal | 305,501 | 305,500 |
Net | 305,501 | 305,500 |
August 2022 | ||
NOTES PAYABLE | ||
Principal | 105,500 | 105,500 |
Net | 105,500 | 105,500 |
September 2022 | ||
NOTES PAYABLE | ||
Principal | 917,491 | 814,383 |
Net | 917,491 | $ 814,383 |
March 2024 | ||
NOTES PAYABLE | ||
Principal | 149,500 | |
Debt discount balance | (18,645) | |
Net | $ 130,855 |
NOTES PAYABLE - Additional Info
NOTES PAYABLE - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Aug. 08, 2022 USD ($) | Mar. 10, 2022 USD ($) | Mar. 31, 2024 USD ($) D $ / shares | Mar. 31, 2024 USD ($) $ / shares | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
NOTES PAYABLE | ||||||
Principal amount due | $ 932,601 | |||||
Maturity date | Sep. 25, 2025 | |||||
Capped interest rate | 12% | 12% | ||||
Payment of principal per units | $ / shares | $ 600 | |||||
Principal amount of convertible notes converted | $ 20,877 | $ 50,000 | ||||
Debt default penalty amount | $ 251,000 | |||||
Converted of principal amount | $ 30,000 | |||||
Accrued interest | 128,763 | 128,763 | ||||
Net | $ 1,629,559 | 1,629,559 | $ 1,393,601 | |||
Maximum | ||||||
NOTES PAYABLE | ||||||
Interest Rate During Period | 125% | |||||
Minimum | ||||||
NOTES PAYABLE | ||||||
Interest Rate During Period | 115% | |||||
Convertible promissory notes | ||||||
NOTES PAYABLE | ||||||
Outstanding balance of debt | $ 149,500 | $ 149,500 | ||||
Principal and interest due amount | $ 145,354 | $ 342,070 | $ 18,604 | |||
Accrued and default interest on payment (as a percent) | 125% | 125% | ||||
Legal fees payment (as a percent) | 150% | 150% | ||||
Debt default penalty amount | $ 158,000 | |||||
Converted of principal amount | $ 23,661 | |||||
Conversion price per share (in dollars per share) | $ / shares | $ 0.00102 | $ 0.00102 | ||||
Proceeds from Issuance of Debt | $ 130,000 | |||||
Original issue discount | $ 19,500 | |||||
Interest rate (as a percent) | 12% | 12% | ||||
Net | $ 167,440 | $ 167,440 | ||||
Percentage of discount on conversion of note | 35% | |||||
Threshold trading days | D | 10 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - Government Debt - USD ($) | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2020 | Mar. 31, 2024 | Mar. 31, 2023 | |
LONG-TERM DEBT | |||
Proceeds from issuance of long-term debt | $ 150,000 | ||
Interest rate (as a percent) | 3.75% | ||
Debt instrument deferment period | 30 months | ||
Payment of principal and interest | $ 731 | ||
Interest expenses | $ 1,402 | $ 1,387 |
DERIVATIVE LIABILITIES - Fair v
DERIVATIVE LIABILITIES - Fair value of derivative liability (Details) | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
DERIVATIVE LIABILITIES | |
Fair value, Beginning balance | $ 532,334 |
Derivative liabilities in conjunction with settlement of convertible promissory notes | 213,957 |
Conversion of convertible promissory notes | (14,663) |
Change in fair value of derivative liabilities | $ 676,374 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change in fair value of derivative liabilities |
Fair value, Ending balance | $ 1,408,002 |
DERIVATIVE LIABILITIES - Lattic
DERIVATIVE LIABILITIES - Lattice pricing (Details) | Mar. 31, 2024 Y $ / shares |
Market value of common stock | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | $ / shares | 0.0009 |
Minimum | Expected volatility | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 1.812 |
Minimum | Expected term (in years) | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 0.27 |
Minimum | Risk-free interest rate | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 0.0491 |
Maximum | Expected volatility | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 2.003 |
Maximum | Expected term (in years) | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 1.5 |
Maximum | Risk-free interest rate | |
DERIVATIVE LIABILITIES | |
Derivative liability, measurement input | 0.0498 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||||
Jul. 15, 2023 | Jul. 14, 2023 | Feb. 28, 2023 | Jan. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
RELATED PARTY TRANSACTIONS | |||||||
Common stock, per share | $ 0.00001 | $ 0.00001 | |||||
Value of compensation expenses | $ 315,000 | ||||||
Selling, general and administrative expenses | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Compensation expense | $ 400,000 | ||||||
Value of compensation expenses | $ 315,000 | ||||||
Consulting agreement | Advisor | Employee and consultant stock ownership plan | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Term of consulting agreement | 1 year | ||||||
Number of compensation shares of common stock | 35,000,000 | ||||||
Common stock, per share | $ 0.01 | ||||||
Related party | Employee | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Compensation fee per month as board of director fee | $ 5,000 | ||||||
Related party | Advisor | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Compensation fee per month as board of director fee | 5,000 | ||||||
CEO | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Cash Bonus paid | 0 | $ 10,000 | |||||
Salary | $ 265,000 | $ 365,000 | |||||
Accrued salary | $ 64,154 | ||||||
Percentage of discount when accrued salary converts to shares | 25% | ||||||
CEO | Series B Preferred Stock | |||||||
RELATED PARTY TRANSACTIONS | |||||||
Number of shares issued | 1 |
STOCKHOLDERS' DEFICIT (Details)
STOCKHOLDERS' DEFICIT (Details) | 1 Months Ended | 3 Months Ended |
Mar. 31, 2024 USD ($) $ / shares | Mar. 31, 2024 USD ($) $ / shares shares | |
STOCKHOLDERS' DEFICIT | ||
Principal amount | $ 30,000 | |
Convertible notes payable | ||
STOCKHOLDERS' DEFICIT | ||
Principal amount | $ 23,661 | |
Shares issued upon conversion | shares | 23,196,579 | |
Conversion price per share (in dollars per share) | $ / shares | $ 0.00102 | $ 0.00102 |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details) - shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2017 | |
STOCK OPTIONS AND WARRANTS | ||
Number of shares authorized to be issued under the Plan | 50,000,000 | |
Term of the awards granted | 10 years | |
Number of stock options granted | 0 | |
Number of outstanding warrants cancelled | 160,500,000 |
STOCK OPTIONS AND WARRANTS - Wa
STOCK OPTIONS AND WARRANTS - Warrants (Details) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
STOCK OPTIONS AND WARRANTS | ||
Number Outstanding | 16,167,533 | 176,838,431 |
Exercise price 0.00102 | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | |
Number Outstanding | 170,898 | |
Exercise Price 0.52 | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.52 | $ 0.52 |
Number Outstanding | 100,000 | 100,000 |
Exercise Price 0.025 | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.025 | $ 0.025 |
Number Outstanding | 9,000,000 | 9,000,000 |
Exercise price 0.025 Two | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.025 | $ 0.025 |
Number Outstanding | 450,000 | 450,000 |
Exercise price 0.00102 One | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | $ 0.00102 |
Number Outstanding | 3,336,843 | 3,336,843 |
Exercise price 0.00102 Two | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | $ 0.00102 |
Number Outstanding | 2,780,690 | 2,780,690 |
Exercise price 0.00102 Three | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | $ 0.00102 |
Number Outstanding | 500,000 | 500,000 |
Exercise price 0.00102 Four | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | |
Number Outstanding | 12,500,000 | |
Exercise price 0.00102 Five | ||
STOCK OPTIONS AND WARRANTS | ||
Exercise Price | $ 0.00102 | |
Number Outstanding | 148,000,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2024 USD ($) item | Sep. 30, 2023 USD ($) | Mar. 31, 2024 USD ($) item | |
COMMITMENTS AND CONTINGENCIES | |||
Commitment for product development | $ 300,000 | ||
Amount for product development paid | $ 150,000 | ||
Renewal term (in years) | 3 years | ||
Borrowing rate (in percent) | 12.40% | 12.40% | |
Rent expense | $ 16,236 | ||
Effective borrowing rate | 12% | 12% | |
Principal amount due | $ 932,601 | ||
Expected milestone term (in months) | 12 months | ||
Base rent per month | $ 5,280 | ||
Number of filed pending court actions | item | 0 | 0 | |
Estimated loss from claims | $ 5,000 | $ 5,000 | |
Convertible promissory notes | |||
COMMITMENTS AND CONTINGENCIES | |||
Accrued interest | 145,354 | ||
Total default penalties | 158,000 | $ 158,000 | |
Principal interest rate during the period | 125% | ||
Accrued interest rate during period | 150% | ||
Principal amount due | $ 342,070 | ||
Convertible promissory notes | |||
COMMITMENTS AND CONTINGENCIES | |||
Principal amount | $ 149,500 | $ 149,500 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Maturities of our operating lease liabilities (Details) | Mar. 31, 2024 USD ($) |
Maturities of operating lease liabilities | |
2025 | $ 65,757 |
2026 | 67,730 |
2027 | 34,366 |
Total lease payments | 167,853 |
Less imputed interest | (24,420) |
Total | $ 143,433 |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Commitments and Contingencies. |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) | 1 Months Ended | 3 Months Ended | |||
Jun. 15, 2024 USD ($) item $ / shares | Apr. 03, 2024 USD ($) $ / shares | Mar. 31, 2024 USD ($) $ / shares | Mar. 31, 2024 USD ($) $ / shares | Mar. 31, 2023 USD ($) | |
SUBSEQUENT EVENTS | |||||
Principal amount due | $ 932,601 | ||||
Maturity date | Sep. 25, 2025 | ||||
Capped interest rate | 12% | 12% | |||
Payment of principal per units | $ / shares | $ 600 | ||||
Principal amount of convertible notes converted | $ 20,877 | $ 50,000 | |||
Minimum | |||||
SUBSEQUENT EVENTS | |||||
Interest Rate During Period | 115% | ||||
Maximum | |||||
SUBSEQUENT EVENTS | |||||
Interest Rate During Period | 125% | ||||
Convertible promissory notes | |||||
SUBSEQUENT EVENTS | |||||
Price per share of debt converted | $ / shares | $ 0.00102 | $ 0.00102 | |||
SUBSEQUENT EVENTS | |||||
SUBSEQUENT EVENTS | |||||
Principal amount due | $ 305,501 | ||||
Accrued interest | $ 36,971 | ||||
Maturity date | Sep. 25, 2025 | ||||
Capped interest rate | 12% | ||||
Payment of principal per units | $ / shares | $ 400 | ||||
Principal amount of convertible notes converted | $ 30,000 | ||||
SUBSEQUENT EVENTS | Minimum | |||||
SUBSEQUENT EVENTS | |||||
Interest Rate During Period | 115% | ||||
SUBSEQUENT EVENTS | Maximum | |||||
SUBSEQUENT EVENTS | |||||
Interest Rate During Period | 125% | ||||
SUBSEQUENT EVENTS | Convertible promissory notes | |||||
SUBSEQUENT EVENTS | |||||
Number of shares agreed to be issued | item | 79,629,143 | ||||
Amount of note payable | $ 81,222 | ||||
Price per share of debt converted | $ / shares | $ 0.00102 |