v3.21.2

CONVERTIBLE NOTES PAYABLE | 3 Months Ended
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Jun. 30, 2021
Debt Disclosure [Abstract] |
CONVERTIBLE NOTES PAYABLE | NOTE 9 – CONVERTIBLE NOTES PAYABLE The following is a summary of convertible notes payable as of June 30, 2021:
Convertible note payable |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Note* |  | Inception Date |  | Maturity |  | Coupon |  |  | Face Value |  |  | Unamortized Discount |  |  | Carrying Value |
Note 5 |  | 1/27/2020 |  | 1/27/2021 |  |  | 8% |  |  | $ | 202,400 |  |  | $ | – |  |  | $ | 202,400 |
Note 6 |  | 2/19/2020 |  | 2/19/2021 |  |  | 8% |  |  |  | 85,800 |  |  |  | – |  |  |  | 85,800 |
Note 7 |  | 3/10/2020 |  | 3/10/2021 |  |  | 8% |  |  |  | 85,800 |  |  |  | – |  |  |  | 85,800 |
Note 8 |  | 8/4/2020 |  | 8/4/2021 |  |  | 8% |  |  |  | 156,000 |  |  |  | 9,379 |  |  |  | 146,621 |
Note 9 |  | 10/2/2020 |  | 10/2/2021 |  |  | 8% |  |  |  | 205,000 |  |  |  | 37,415 |  |  |  | 167,585 |
Note 10 |  | 10/15/2020 |  | 10/15/2021 |  |  | 8% |  |  |  | 172,000 |  |  |  | 27,964 |  |  |  | 144,036 |
Note 11 |  | 11/2/2020 |  | 11/2/2021 |  |  | 8% |  |  |  | 69,000 |  |  |  | 13,114 |  |  |  | 55,886 |
Note 12 |  | 11/12/2020 |  | 11/12/2021 |  |  | 8% |  |  |  | 69,000 |  |  |  | 8,318 |  |  |  | 60,682 |
Note 14 |  | 12/10/2020 |  | 12/10/2021 |  |  | 8% |  |  |  | 80,000 |  |  |  | 16,515 |  |  |  | 63,485 |
Note 16 |  | 1/14/2021 |  | 1/14/2022 |  |  | 8% |  |  |  | 107,000 |  |  |  | 23,068 |  |  |  | 83,932 |
Note 17 |  | 1/27/2021 |  | 1/27/2021 |  |  | 8% |  |  |  | 60,000 |  |  |  | 15,969 |  |  |  | 44,031 |
Note 18 |  | 2/3/2021 |  | 2/3/2022 |  |  | 8% |  |  |  | 45,250 |  |  |  | 33,439 |  |  |  | 11,811 |
Note 19 |  | 2/12/2021 |  | 2/12/2022 |  |  | 8% |  |  |  | 69,000 |  |  |  | 47,402 |  |  |  | 21,598 |
Note 20 |  | 4/30/2021 |  | 4/30/2022 |  |  | 8% |  |  |  | 104,000 |  |  |  | 3,343 |  |  |  | 100,657 |
Note 21 |  | 5/25/2021 |  | 5/25/2022 |  |  | 8% |  |  |  | 104,000 |  |  |  | 5,586 |  |  |  | 98,414 |
Note 22 |  | 6/24/2021 |  | 6/24/2022 |  |  | 8% |  |  |  | 185,652 |  |  |  | 57,529 |  |  |  | 128,123 |
Total |  |  |  |  |  |  |  |  |  | $ | 1,799,902 |  |  | $ | 299,041 |  |  | $ | 1,500,861 |
* Notes 1, 2, 3 and 4 in the amounts of $82,000, $208,000, $27,000 and $62,000, respectively, were fully converted as of March 31, 2021. Between April 1, 2021 and June 30, 2021, the Company issued to “accredited investors,” Convertible Promissory Notes aggregating a principal amount of $393,652. The Company received an aggregate net proceeds of $370,181 after $23,471 in original note discount. The Company has agreed to pay interest on the unpaid principal balance at the rate of eight percent (8%) per annum from the dates on which Notes are issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the Notes, provided it makes a payment as set forth in the agreements. The outstanding principal amount of the Notes is convertible into the Company’s common stock at the lender’s option at $0.01 per share for the first six months of the term of the Notes. After the six-month anniversary, the conversion price is equal to 63% of the average of the three lowest trading prices of the Company’s common stock. Accounting Considerations The Company has accounted for the Notes as a financing transaction, wherein the net proceeds that were received were allocated to the financial instrument issued. Prior to making the accounting allocation, the Company evaluated the agreement under ASC 815 Derivatives and Hedging (“ASC 815”). ASC 815 generally requires the analysis embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract. The material embedded derivative features consisted of the embedded conversion option and default puts. The conversion option and default puts bear risks of equity which were not clearly and closely related to the host debt agreement and required bifurcation. The contracts do not permit the Company to settle in registered shares and the contracts also contain make-whole provisions both of which preclude equity classification. Current accounting principles that are also provided in ASC 815 do not permit an issuer to account separately for individual derivative terms and features that require bifurcation and liability classification. Rather, such terms and features must be and were bundled together and fair valued as a single, compound embedded derivative. The net proceeds were allocated to the compound embedded derivative and original issue discount. The notes will be amortized up to its face value over the life of Notes based on an effective interest rate. Amortization expense and interest expense for the three months ended June 30, 2021 is as follows:
Amortization expense, interest expense and accrued interest |  |  |  |  |  |  |  |  |  |  |  |
Note |  | Interest Expense |  |  | Accrued Interest |  |  | Amortization of Debt Discount |  |  | Unamortized |
Note 5 |  | $ | 8,730 |  |  | $ | 30,132 |  |  | $ | – |  |  | $ | – |
Note 6 |  |  | 3,850 |  |  |  | 11,800 |  |  |  | – |  |  |  | – |
Note 7 |  |  | 3,850 |  |  |  | 10,979 |  |  |  | – |  |  |  | – |
Note 8 |  |  | 3,111 |  |  |  | 11,283 |  |  |  | 13,022 |  |  |  | 9,379 |
Note 9 |  |  | 4,089 |  |  |  | 12,176 |  |  |  | 30,586 |  |  |  | 37,415 |
Note 10 |  |  | 3,431 |  |  |  | 9,726 |  |  |  | 17,947 |  |  |  | 27,964 |
Note 11 |  |  | 1,376 |  |  |  | 3,630 |  |  |  | 8,172 |  |  |  | 13,114 |
Note 12 |  |  | 1,376 |  |  |  | 3,478 |  |  |  | 5,573 |  |  |  | 8,318 |
Note 14 |  |  | 1,596 |  |  |  | 3,542 |  |  |  | 8,224 |  |  |  | 16,515 |
Note 15 |  |  | 12 |  |  |  | – |  |  |  | 43,661 |  |  |  | – |
Note 16 |  |  | 2,134 |  |  |  | 3,916 |  |  |  | 8,296 |  |  |  | 23,068 |
Note 17 |  |  | 1,198 |  |  |  | 2,026 |  |  |  | 5,469 |  |  |  | 15,969 |
Note 18 |  |  | 903 |  |  |  | 1,459 |  |  |  | 5,169 |  |  |  | 33,439 |
Note 19 |  |  | 1,376 |  |  |  | 2,087 |  |  |  | 8,468 |  |  |  | 47,402 |
Note 20 |  |  | 1,390 |  |  |  | 1,390 |  |  |  | 656 |  |  |  | 3,343 |
Note 21 |  |  | 821 |  |  |  | 821 |  |  |  | 493 |  |  |  | 5,586 |
Note 22 |  |  | 244 |  |  |  | 244 |  |  |  | – |  |  |  | 57,529 |
|  | $ | 39,487 |  |  | $ | 108,689 |  |  | $ | 155,736 |  |  | $ | 299,041 |
As of June 30, 2021, Note 5, Note 6, and Note 7 are considered in default. Upon an event of default, the interest accrues at 18%. Additionally, upon non-payment at maturity, the principal increases by 10%. The principal on Note 5 increased by $18,400, Note 6 increased by $7,800 and Note 7 increased by $7,800.

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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