7. LOANS

Long term

	September 30, 2018		September 30, 2017
Long-term loans payable consist of the following:

Promissory notes	$	150,000	$	150,000

Total	$	150,000	$	150,000

On November 11, 2017, the Company executed a 10% secured promissory note with a face value of $100,000 with an investor. Under the terms of the promissory note the Company received $100,000 and agreed to make monthly interest payments and repay the note principal 24 months from the date of issuance. The note is secured by 100,000 shares which would be issued to the note holder only in the case of an uncured default. As of September 30, 2018, the Company owed $100,000 in principal and $822 in accrued interest under the terms of the agreement and recorded interest expense of $6,411 for the year ended September 30, 2018.

On December 5, 2017, the Company executed a 9% secured promissory note with a face value of $50,000 with an investor. Under the terms of the promissory note the Company received $50,000 and agreed to make monthly interest payments and repay the note principal 24 months from the date of issuance. The note is secured by 50,000 shares which would be issued to the note holder only in the case of an uncured default. As of September 30, 2018, The Company owed $50,000 in principal and $370 in accrued interest under the terms of the agreement and recorded interest expense of $2,552 for the year ended September 30, 2018.

Current

	September 30, 2018			September 30, 2017
Current loans payable consist of the following:

Promissory notes	$	628,951		$	—
Insurance financing loans		10,257			7,712
Unamortized debt discount		(181,629	)		—

Total, net of unamortized discount	$	457,579		$	7,712

Promissory Notes

On September 5, 2017, the Company executed a 9% secured promissory note with a face value of $150,000 with an investor. Under the terms of the promissory note, the Company received $150,000 and agreed to make monthly interest payments and repay the note principal 24 months from the date of issuance. The note is secured by 150,000 shares which are held in escrow and would be issued to the note holder only in the case of an uncured default. As of September 30, 2018, the Company owed $150,000 in principal and $0 in accrued interest under the terms of the agreement and recorded interest expense of $13,500 during the year ended September 30, 2018.

On October 6, 2017, the Company executed an unsecured variable interest rate promissory note with a maximum interest rate of 58.3% and a face value of $45,000 with a financial institution. Under the terms of the promissory note the Company received $45,000 and agreed to repay the note evenly over 12 months. As of September 30, 2018, the Company owed $3,750 in principal and $450 in accrued interest under the terms of the agreement and recorded interest expense of $14,175 during the year ended September 30, 2018. The Company repaid all principal and outstanding interest on October 1, 2018.

On November 20, 2017, the Company executed a 10% unsecured promissory note with a face value of $80,000 with an investor. Under the terms of the promissory note the Company received $80,000 and agreed to make monthly interest payments and repay the note principal 12 months from the date of issuance. As of September 30, 2018, the Company owed $80,000 in principal and $0 in accrued interest under the terms of the agreement and recorded interest expense of $6,882 during the year ended September 30, 2018. On November 21, 2018, the investor extended the maturity date to December 31, 2018. The Company repaid all principal and outstanding interest on December 31, 2018.

On January 12, 2018, the Company executed an unsecured variable interest rate promissory note with a maximum interest rate of 58.5% and a face value of $18,400 with a financial institution. Under the terms of the promissory note the Company received $18,400 and agreed to repay the note and interest evenly over 12 months. As of September 30, 2018, the Company owed $6,133 in principal and $184 in accrued interest under the terms of the agreement and recorded interest expense of $5,520 during the year ended September 30, 2018. The Company repaid all principal and outstanding interest on October 1, 2018.

On February 27, 2018, we entered into an unsecured promissory note pursuant to which we borrowed $125,000. The note carries an original issue discount of 5.6% ($7,000). Interest under the promissory note was 10% per annum. Under the terms of the promissory note the Company agreed to make interest and principal payments equal to $2,500 or greater on a monthly basis. All unpaid balances under the note were due in full on August 1, 2018. The note was settled in full on August 1, 2018 through the issuance of a new promissory note. The Company recorded interest expense of $5,453 during the year ended September 30, 2018. The aggregate original issued issue discount has been accreted and charged to interest expenses as a financing expense in the amount of $7,000 during the year ended September 30, 2018.

On May 22, 2018, the Company executed an unsecured variable interest rate promissory note with a maximum interest rate of 51.0% and a face value of $24,500 with a financial institution. Under the terms of the promissory note the Company received $24,500 and agreed to repay the note and interest evenly over 12 months. As of September 30, 2018, the Company owed $18,375 in principal and $1,960 in accrued interest under the terms of the agreement and recorded interest expense of $4,900 during the year ended September 30, 2018. The Company repaid all principal and outstanding interest on October 1, 2018.

On June 15, 2018, we entered into a 10% secured promissory note with a face value of $116,600 pursuant to which we received $110,000, net of an original issue discount of 6% ($6,600). The Company also issued 116,600 5-year warrants exercisable at $0.80 in connection with issuance of the promissory note. Under the terms of the promissory note the Company agreed to make monthly interest payments and repay the note principal on December 15, 2018. The note is secured by the Company’s accounts receivable. As of September 30, 2018, the Company owed $116,600 in principal and $0 in accrued interest under the terms of the agreement and recorded interest expense of $3,418 during the year ended September 30, 2018. The Company has determined the value associated with the warrants issued in connection with the note to be $110,000 which has been recorded as a debt discount. The aggregate original issue discount, and debt discount related to the warrants have been accreted and charged to interest expenses as a financing expense in the amount of $68,176 for the year ended September 30, 2018. The unamortized discount as of September 30, 2018 amounted to $48,424. The Company repaid all principal and outstanding interest on January 2, 2019.

On August 1, 2018, we entered into a 10% secured promissory note with a face value of $130,625 pursuant to which we received $125,000, net of an original issue discount of 4.5% ($5,625). The Company also issued 25,000 5-year warrants exercisable at $0.80 in connection with purchase of the promissory note. The proceeds of the note were used to settle in full a note issued on February 27, 2018. Under the terms of the promissory note the Company agreed to make monthly interest only payments and repay the note principal on November 30, 2018. The note is secured by the Company’s accounts receivable. As of September 30, 2018, the Company owed $127,748 in principal and $0 in accrued interest under the terms of the agreement and recorded interest expense of $2,171 during the year ended September 30, 2018. The Company has determined the value associated with the warrants issued in connection with the note to be $71,373 which has been recorded as a debt discount. The aggregate original issue discount, and debt discount related to the warrants have been accreted and charged to interest expenses as a financing expense in the amount of $38,499 the year ended September 30, 2018. The unamortized discount as of September 30, 2018 amounted to $38,499. The Company repaid all principal and outstanding interest on January 2, 2019.

On August 14, 2018, the Company executed an unsecured variable interest rate promissory note with a maximum interest rate of 58.57% and a face value of $19,600 with a financial institution. Under the terms of the promissory note the Company received $19,600 and agreed to repay the note and interest evenly over 12 months. As of September 30, 2018, the Company owed $17,967 in principal and $784 in accrued interest under the terms of the agreement and recorded interest expense of $1,568 during the year ended September 30, 2018. The Company repaid all principal and outstanding interest on October 1, 2018.

On September 20, 2018, the Company executed a 10% unsecured promissory note with a face value of $52,500 with an investor, net of an original issue discount of 5% ($2,500). Under the terms of the promissory note the Company received $50,000 and agreed to repay the note principal and all accrued interest on December 31, 2018. The Company also issued 25,000 5-year warrants exercisable at $0.80 in connection with purchase of the promissory note. As of September 30, 2018, the Company owed $50,000 in principal and $144 in accrued interest under the terms of the agreement and recorded interest expense of $144 during the year ended September 30, 2018. The Company has determined the value associated with the warrants issued in connection with the notes to be $50,000 which has been recorded as a debt discount. The aggregate original issue discount, and debt discount related to the warrants have been accreted and charged to interest expenses as a financing expense in the amount of $5,147 the year ended September 30, 2018. The unamortized discount as of September 30, 2018 amounted to $47,353. The Company repaid all principal and outstanding interest on December 31, 2018

On September 21, 2018, the Company executed a 10% unsecured promissory note with a face value of $52,500 with an investor, the note included an original issue discount of 5% ($2,500). Under the terms of the promissory note the Company received $50,000 and agreed to repay the note principal and all accrued interest on December 31, 2018. The Company also issued 25,000 5-year warrants exercisable at $0.80 in connection with purchase of the promissory note. As of September 30, 2018, the Company owed $50,000 in principal and $144 in accrued interest under the terms of the agreement and recorded interest expense of $144 during the year ended September 30, 2018. The Company has determined the value associated with the warrants issued in connection with the notes to be $50,000 which has been recorded as a debt discount. The aggregate original issue discount, and debt discount related to the warrants have been accreted and charged to interest expenses as a financing expense in the amount of $5,147 the year ended September 30, 2018. The unamortized discount as of September 30, 2018 amounted to $47,353. The Company repaid all principal and outstanding interest on December 31, 2018.

Insurance financing loans

In February 2018, the Company executed two unsecured 6.1% installment loans with a total face value of $35,089 with a financial institutional to finance its insurance policies. Under the terms of the installment notes the Company received $35,089 and agreed to make equal payments and repay the notes’ principal 10 months from their dates of issuance. As of September 30, 2018, the Company owed $10,257 in principal and $0 in accrued interest under the terms of the agreement. The Company repaid all principal and outstanding interest on December 1, 2018.