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LOANS PAYABLE
 9 Months Ended
Sep. 30, 2022
Debt Disclosure [Abstract]  
LOANS PAYABLE

NOTE 7 — LOANS PAYABLE

 

Loans Payable

 

On October 25, 2018, the Company entered in a promissory note payable with an accredited investor for $50,000 due on October 25, 2019. Pursuant to the note, the maturity date was extended to October 25, 2020. The promissory note bears interest at 100% per annum and the note holder was issued shares of the Company’s common stock in lieu of interest. On October 7, 2020, the Company entered into a Letter of Agreement Addendum with the note holder, whereas, the Company agreed to make ten monthly principal payments beginning November 1, 2020 with the full principal amount to be paid in full by August 31, 2021. In addition, if the full principal amount was not paid in full by August 31, 2021 the Company was to and did issue an additional 2,500 shares of common stock to the noteholder. On November 11, 2021, the Company entered into a Second Letter of Agreement Addendum with the note holder, whereas, the Company agreed to continue making monthly payments beginning on December 1, 2021. Total interest expense related to this note was $15,643 and $37,500 for the nine months ended September 30, 2022 and 2021, respectively. Total interest expense related to this note was $4,100 and $12,500 for the three months ended September 30, 2022 and 2021, respectively. During the nine months ended September 30, 2022 and the year ended December 31, 2021, the Company paid $27,200 and $9,600, respectively, in cash towards the outstanding principal. The amount outstanding at December 31, 2021, was $27,200. On September 28, the note holder waived the accrued interest of $165,643 and the note was paid in full as of September 30, 2022.

 

On February 4, 2021, under the U.S. Small Business Administration’s Paycheck Protection Program, the Company entered into a second note payable with a financial institution for $22,916 at an interest rate of 1% per annum and a maturity date of February 4, 2026. Pursuant to the note, principal and interest payments are deferred for ten months, which, at any time during the ten months the Company may apply for loan forgiveness. The Company applied for loan forgiveness on a timely basis, and as of September 30, 2022, the total amount of $22,916 has been forgiven.

 

Legacy Ventures International, Inc.

 

On September 11, 2017, the Company issued a promissory note (the “Promissory Note”) in favor of Legacy Ventures International, Inc. (“Legacy”) as part of a commercial transaction with Legacy that was never consummated. The Promissory Note was issued in the original principal amount of $500,000, with interest at 4% per annum and a maturity date of December 31, 2017. As of September 30, 2022, this promissory note is in default. The Company recorded $15,000 and $15,000 of interest expense for the nine months ended September 30, 2022 and 2021, respectively. The Company recorded $5,000 and $5,000 of interest expense for the three months ended September 30, 2022 and 2021, respectively. The amount outstanding at September 30, 2022 and December 31, 2021 was $500,000.