Note 3 - Notes payable to shareholders | Note 3 – Notes payable to shareholders On January 12, 2021, the Company sold convertible notes bearing 12% interest per annum on the principal amount of $360,000, respectively. The principal amount was agreed to be paid in two tranches of $180,000 each, received on February 19, 2021 and March 08, 2021. The note is subject to certain ownership limitations and will be convertible at the option of the holder at any time into shares of the Company’s common stock at an effective conversion rate of $0.144. The beneficial conversion features of this note were valued at $35,500 and $7,500 for each tranche received and are amortized over the life of the note. On December 13, 2022, the Company converted the notes, in which on that date, the outstanding $360,000 in principle and $76,044 in interest were converted into 2,952,548 fully vested options to purchase common stock. The options expire in five years with the exercise price of $0.02. The options were valued at $65,236, in the aggregate, using Black Scholes. On February 04, 2022, the Company sold convertible note bearing 12% interest per annum in the principal amount of $350,000 (“February 2022 Notes”). The note will be paid in three tranches with first tranche of $100,000 received on March 28, 2022. The second and third tranches of $150,000 and $100,000 each, were received on May 3, 2022, and June 21, 2022, respectively. The note is subject to certain ownership limitations and will be convertible at the option of the holder at any time into shares of the Company’s common stock at an effective conversion rate of $ 0.013. The February 2022 Notes contain embedded derivatives, see Note 8. On June 8, 2022, the Company converted the July 2019 Notes, November 2019 Note and the 2020 Notes (collectively “Converted Notes”), with an aggregate principal balance of $1,108,000 and $282,838 of accrued interest into stock options. The options expire in five years with the exercise prices ranging between $0.14 and $0.34. The options were valued at $216,981, in the aggregate, using Black Scholes. On August 26, 2022, the Company sold convertible note bearing 12% interest per annum in the principal amount of $325,000 (“August 2022 Notes”). The note is disbursed in three tranches with first tranche of $125,000 received on September 1, 2022. The second tranche of $100,000 was received on September 19, 2022 and the third tranche of $100,000 was received on October 15, 2022. The note is subject to certain ownership limitations and will be convertible at the option of the holder at any time into shares of the Company’s common stock at an effective conversion rate of $0.046. The August 2022 Notes contain embedded derivatives, see Note 8. On December 21, 2022, the Company sold convertible note bearing 12% interest per annum in the principal amount of $120,000 (“December 2022 Notes”). The note is disbursed in four tranches with first tranche of $40,000 received on January 10, 2023, and the remaining tranches of $20,000, $20,000 and $40,000 received on February 10, 2023, March 3, 2023 and March 31, 2023, respectively. The December 2022 Notes contain embedded derivatives, see Note 8. On April 30, 2023, the Company sold convertible note bearing 12% interest per annum in the principal amount of $100,000 (“April 2023 Notes”). The note is disbursed in three tranches with first tranche of $20,000 received on May 12, 2023, and the remaining tranches of $40,000 each received on May 31, 2023 and June 28, 2023, respectively. The April 2023 Notes contain embedded derivatives, see Note 8. Amount Balance of notes payable, net of discount on June 30, 2022 $ 389,319 Amortization of debt discount 385,413 New Issuances 545,000 Embedded Conversion Feature – Debt discount (545,000) Conversion of Notes Payable less Accrued Interest to stock options (360,000) Balance of notes payable, net of discount as of June 30, 2023 $ 414,732 |