Convertible Notes Payable | Note 6. Convertible Notes Payable Convertible notes payable at December 31, 2021 and December 31, 2020 consist of the following: Schedule of Convertible Notes Payable December 31, 2021 December 31, 2020 Note 1 and accrued interest and premium – Principal shareholder $ - $ 195,177 Note 2 and accrued interest – Principal shareholder - 126,210 Note 3 and accrued interest – Shareholder - 62,951 Note 4 and accrued interest – Principal shareholder - 97,537 Note 5 and accrued interest – Accredited investors - 56,462 Note 6 and accrued interest – Principal shareholder - 89,347 Note 7 and accrued interest – Accredited investors - 101,781 Note 8 and accrued interest – Accredited investors 27,555 25,055 Note 9 and accrued interest – Shareholder 106,521 - Note 10 and accrued interest, net of discount and issuance costs – Mercer Note 532,551 - Total Convertible notes payable and accrued interest $ 665,627 $ 754,520 Note 1 – In October 2009, the Company issued a Convertible Promissory Note with a principal amount of $ 73,500 to its principal shareholder (Note 1). The note bears interest at the rate of 12 % per annum until paid or the note and accrued interest is converted into shares of the Company’s common stock. On February 27, 2020, the note was modified to extend the maturity date to March 31, 2023 0.10 Debt, Modification and Extinguishments 21,299 On December 30, 2021, the Company and its principal shareholder entered into an agreement to exchange certain convertible promissory notes of the Company held by the principal shareholder along with associated accrued interest into 2,644,424 73,500 21,299 109,198 0.10 0 100,378 Note 2 – Effective September 1, 2019, the Company issued a Convertible Promissory Note in the principal amount of $ 124,562 1 0.25 On December 30, 2021, the Company and its principal shareholder entered into an agreement to exchange certain convertible promissory notes of the Company held by the principal shareholder along with associated accrued interest into 2,644,424 124,562 2,894 0.25 0 1,648 Note 3 – Effective September 12, 2019, the Company issued a Convertible Promissory Note in the principal amount of $ 55,000 12 0.25 55,000 7,951 0.25 251,805 Note 4 – Effective December 27, 2019, the Company issued a Convertible Promissory Note in the principal amount of $ 88,626 to its principal shareholder in consideration for advances previously made to the Company (Note 4). This note bore interest at the rate of 10 % per annum and was due and payable on December 30, 2022 . The Note was convertible into shares of common stock at a price of $ 0.55 per share. On March 15, 2021, the principal shareholder assigned this convertible note along with all accrued and future interest to a third-party shareholder. On March 31, 2021 the shareholder elected to convert the outstanding principal of $ 88,626 along with accrued interest of $ 11,096 into common stock at a price of $ 0.55 per share resulting in the issuance of 181,313 shares of common stock. As of December 31, 2021 and December 31, 2020, this note had accumulated $ 0 and $ 8,911 , respectively of accrued interest. Note 5 – Under subscription agreements dated September 25, 2020, the Company issued Convertible Promissory Notes (the “Notes”) to various individuals totaling $ 55,000 . The Notes bore interest at the rate of 10 % per annum and matured on September 30, 2022 (the “Maturity Date”) at which date all outstanding principal and accrued and unpaid interest are due and payable unless a Default Event, as defined, occurs. The Company could satisfy the Notes upon maturity or Default, as defined, by the issuance of Common shares at a conversion price equal to the greater of a 20% discount to the 15 day average market price of the Company’s common stock or $0.10. The principal and interest accrued are convertible at any time after six months through the Maturity Date at the option of the holder at a 20% discount to the 15 day average market price of the Company’s share price, but in no event less than $0.10 per share. Upon conversion of any portion of the Notes, the investor will receive warrants to purchase up to 25% of the number of common shares issued as a result of such conversion exercisable for a period of two years at a price per share equal to 150% of the conversion price of the Notes . As of March 16, 2021 one of the note holders had elected to convert outstanding principal of $ 30,000 along with accrued interest into 63,600 shares of common stock at a price of $ 0.50 . Additionally, the shareholder received warrants, exercisable for two years, to purchase 15,900 common shares at $ 0.75 per share. As of June 17, 2021 the other note holder had elected to convert outstanding principal of $ 25,000 48,755 0.55 12,189 0.83 As of December 31, 2021 and December 31, 2020, these notes had accumulated $ 0 1,462 Note 6 – Effective September 30, 2020, the Company issued a Convertible Promissory Note in the principal amount of $ 88,016 to its principal shareholder in consideration for advances previously made to the Company (Note 6). This note bears interest at the rate of 6 % per annum and is due and payable on December 31, 2022 . The Note is convertible into shares of common stock at a price of $ 1.00 per share. On December 30, 2021, the Company and its principal shareholder entered into an agreement to exchange certain convertible promissory notes of the Company held by the principal shareholder along with associated accrued interest into 2,644,424 of newly authorized Series A-2 Convertible Preferred Shares. Note 6 was included in that agreement with $ 88,016 of principal combined with accrued interest of $ 6,612 converted at $ 1.00 per share. As of December 31, 2021 and December 31, 2020, this note had accumulated $ 0 and $ 1,331 , respectively of accrued interest. Note 7 – Effective October 27, 2020, the Company issued a Convertible Promissory Note in the principal amount of $ 100,000 September 25, 2020 100,000 214,817 0.49 53,704 0.74 0 1,781 Note 8 – Effective December 23, 2020, the Company issued a Convertible Promissory Note in the principal amount of $ 25,000 September 25, 2020 2,555 55 Note 9 – Effective May 7, 2021, the Company issued a Convertible Promissory Note in the principal amount of $ 100,000 to a shareholder (Note 9). The Note bears interest at the rate of 10 % per annum and matures on September 30, 2022 (the “Maturity Date”) at which date all outstanding principal and accrued and unpaid interest are due and payable unless a Default Event, as defined, occurs. The Company may satisfy the Note upon maturity or Default, as defined, by the issuance of common shares at a conversion price equal to the greater of a 25% discount to the 15 day average market price of the Company’s common stock or $0.50. The principal and interest accrued are convertible at any time through the maturity date of September 30, 2022 at the option of the holder using the same conversion calculation. As of December 31, 2021, this note had accumulated $ 6,521 of accrued interest. Note 10 – Effective August 10, 2021, the Company entered into a Securities Purchase Agreement with an accredited investor pursuant to which it issued to the investor an Original Issue Discount Secured Convertible Promissory Note (the “Note”) in the principal amount of $ 806,000 930,000 750,000 The principal amount of the Note and all interest accrued thereon is payable on August 10, 2022, and are secured by a lien on substantially all of the Company’s assets. The Note provides for interest at the rate of 5 0.65 0.65 0.65 Mercer Street Global Opportunity Fund, LLC, converted $ 50,000 806,000 76,923 0.65 The 930,000 1.25 The Company accounts for the allocation of its issuance costs to its Warrants in accordance with ASC 470-20, Debt with Conversion and Other Options. Under this guidance, if debt or stock is issued with detachable warrants, the proceeds need to be allocated to the two instruments using either the fair value method, the relative fair value method, or the residual value method. The Company used the relative fair value at the time of issuance to allocate the value received between the convertible note and the warrants. The Company estimated the fair value of warrants utilizing the Black-Scholes pricing model, which is dependent upon several assumptions such as the expected term of the Warrants, expected volatility of the Company’s stock price over the expected term, expected risk-free interest rate over the expected term and expected dividend yield rate over the expected term. The Company believes this valuation methodology is appropriate for estimating the fair value of warrants. The value allocated to the relative fair value of the Warrants was recorded as debt issuance costs and additional paid in capital. The principal, net of the original issue discount and debt issuance costs, including the allocated relative fair value of the Warrants, which are being recognized over the life of the note, along with associated interest, is recorded with current liabilities on the Company’s consolidated balance sheets. As of December 31, 2021, this note had accumulated $ 15,446 of accrued interest, total unamortized debt issuance costs of $ 204,835 , including the Warrant value, and the remaining discount of $ 34,060 . |