Notes Payable Disclosure

12 Months Ended

Dec. 31, 2020

Notes

Notes Payable Disclosure

NOTE 7 - NOTES PAYABLE

Notes payable consist of the following at:

	December 31, 2020		December 31, 2019
Note payable, secured, 12% interest, due July 2020	$	-	$	150,000
Note payable, secured, 12% interest, due July 2020		-		100,000
Note payable, secured, 12% interest, due January 2020		-		50,000
Note payable, secured, 12% interest, due July 2020		-		100,000
Note payable, secured, 12% interest, due June 1, 2022		249,027		-
Note payable, secured, 12% interest, due June 1, 2021		300,000		-
Note payable, secured, 12% interest, due October 2019		-		5,750
Note payable, secured, 12% interest, due March 2020		-		12,000
Note payable, secured, 10% interest, due June 2021		231,813		-
Notes payable, secured, 12% interest, due August 2021		258,207		-
Total Notes Payable	$	1,039,047	$	417,750
Less unamortized debt discounts		(308,999)		(5,943)
Total Notes Payable		730,048		411,807
Less current portion		(481,021)		(411,807)
Total Notes Payable - long term	$	249,027	$	-

On September 2, 2016, the Company issued a $100,000 12% promissory note. The note was due on September 1, 2017. As an incentive to enter into the agreement the noteholder was also granted 25,000 shares valued at $25,000 which was recognized as a debt discount. On May 16, 2019, the maturity date of the note was extended to July 1, 2020 (see below) for the issuance of 50,000 shares of common stock valued at $21,000, which was recognized as a debt discount over the extended maturity date, which was recognized as a debt discount over the extended maturity date. As of December 31, 2020, the full amounts of the debt discount have been amortized.

On February 2, 2018, the Company entered into an agreement with the note holder to split a certain note payable dated July 1, 2015 into two notes in the amount of $150,000 and $50,000, respectively. In addition to splitting the notes the noteholder also agreed to extend the due date of the new $50,000 note to July 1, 2018 and on June 4, 2018, for consideration of 15,000 shares the noteholder further agreed to extend the due date of the new $50,000 note to April 1, 2019. On November 15, 2018, both notes were further extended to January 1, 2020 (see below) for the issuance of 80,000 shares valued $40,800. On May 16, 2019, the maturity dates of both notes were extended to July 1, 2020 for the issuance of 50,000 shares of common stock valued at $21,000. The Company recorded the fair market value of all the shares issued for extensions to financing cost.

On January 1, 2020, the Company entered into an agreement to consolidate three notes payable above dated September 2, 2016 and February 2, 2018 into one $300,000, 12% note due June 1, 2021. On June 1, 2021, the Company granted 1,000,000 $0.125 warrants to extend the date of the note to June 1, 2022 (See note 12). As consideration the Company issued the note holder 175,000 shares of common stock valued at $68,250 which was recorded as financing expense. The Company evaluated the modification under ASC 470-50 and determined that the modifications were considered substantial and qualified for extinguishment accounting under such guidance. As such the Company recorded a loss on extinguishment of debt of $68,250 associated with the excess reacquisition cost of the new debt over the carrying value of the original debt. No payments were made and the balance was $300,000 as of December 31, 2020.

On June 11, 2018 the Company issued $160,000 of principal amount of 12% secured convertible promissory notes and warrants to purchase common stock. The notes were due between May and August 2018 and bear interest of percent (12%). The notes are secured by all of the Company’s assets. The outstanding principal amounts and accrued but unpaid interest of the notes is convertible at any time at the option of the holder into common stock at a conversion price of $1.00 per share. The notes were issued with warrants to purchase up to 160,000 shares of the Company’s common stock which were valued at $119,616. On May 16, 2019, the maturity date of the note was

extended to January 11, 2020 for the issuance of 90,000 shares of common stock valued at $45,900. As of December 31, 2020, $165,516 of the debt discount was amortized and the note was shown net of unamortized discount of $0.

On January 30, 2019, the Company issued a $100,000 12% promissory note. The note was due on December 31, 2019. As an incentive to enter into the agreement the noteholder was also granted 100,000 shares valued at $45,000 which was recognized as a debt discount. On May 16, 2019, the maturity date of the note was extended to December 31, 2020 (see below) for the issuance of 55,000 shares of common stock valued at $23,100 The Company recorded the fair market value of all the shares issued for extensions to financing cost.

On January 1, 2020, the Company entered into an agreement to consolidate the above two notes payable dated June 11, 2018 and January 30, 2019 into one $260,000, 12% note due June 1, 2022. On February 24, 2021, the Company issued 500,000 shares to extend the date of the note to May 1, 2023 (See note 12). As consideration the Company issued the note holder 175,000 shares of common stock valued at $68,250, which was recognized as a financing cost. The Company evaluated the modification under ASC 470-50 and determined that the modifications were considered substantial and qualified for extinguishment accounting under such guidance. As such, the Company recorded a loss on extinguishment of debt of $68,250 associated with the excess reacquisition cost of the new debt over the carrying value of the original debt. During the year ended December 31, 2020, the Company paid $10,973 to the noteholder, and the balance of note was $249,027 as of December 31, 2020.

On March 1, 2019, the Company issued a $12,000 12% promissory note. The note was due on March 1, 2020 has been paid in full as of December 31, 2020.

On March 4, 2020, the Company issued a $12,000 10% promissory note. The note is due on March 4, 2021. On March 4, 2020, the Company issued a $12,000 promissory note. On April 17, 2020, the note and accrued interest in the amount of $12,140 was paid.

On June 2, 2020, the Company entered in to a $345,000 note payable, including an original issue discount of $34,500 promissory note. Interest under the promissory note is 12% per annum, and the principal and all accrued but unpaid interest is due twelve (12) months from funding with monthly payment of $37,150 beginning on September 1, 2020. On September 6, 2020, the note was amended to increase the payments on the note to $41,420 and extended the first payment to October 2, 2020. In addition, as part of the amendment the Company can further extend the due date of the first payment with notice to the noteholder and payment of an extension fee of $4,142. The holder has the right upon an event of default to convert the note and accrued interest into common shares at the closing bid price on the date preceding the notice of conversion. As an incentive to enter into the agreement, the noteholder was also granted 1,468,085 shares valued at $308,298, based on market value of the shares of $0.21 on the date of the agreement which was recognized as a debt discount. During the year ended December 31, 2020, $196,287 of the discount was amortized and the note was shown net of unamortized discount of $146,511. During the year ended December 31, 2020, the Company paid $105,180 to the noteholder, and the balance of note was $239,820 as of December 31, 2020.

On August 20, 2020, the Company entered in to a $278,000 note payable, including an original issue discount of $27,800 promissory note. Interest under the promissory note is 12% per annum, and the principal and all accrued but unpaid interest is due twelve (12) months from funding with monthly payment of $31,136 beginning on November 18, 2020. The holder has the right upon an event of default to convert the note and accrued interest into common shares at the closing bid price on the date preceding the notice of conversion. As an incentive to enter into the agreement, the noteholder was also granted 1,002,919 shares valued at $183,334, based on market value of the shares of $0.1828 on the date of the agreement which was recognized as a debt discount. During the year ended December 31, 2020, $76,934 of the discount was amortized and the note was shown net of unamortized discount of $162,488. During the year ended December 31, 2020, the Company paid $27,800 to the noteholder, and the balance of note was $250,200 as of December 31, 2020.

Interest expense including amortization of the associated debt discount for the years ended December 31, 2020 and 2019 was $384,109 and $85,370, respectively.

Payroll Protection Program

On May 4, 2020, we received funds under the Paycheck Protection Program, a part of the CARES Act. The loan is serviced by Bank of America, and the application for these funds required us to, in good faith, certify that the current economic uncertainty made the loan necessary to support our ongoing operations. We used the funds for payroll and

related costs. The receipt of these funds, and the forgiveness of the loan attendant to these funds, is dependent on our ability to adhere to the forgiveness criteria. The loan bears interest at a rate of 1.0% per annum and matures on May 4, 2022, with the first payment deferred until November 2020. Under the terms of the PPP, certain amounts may be forgiven if they are used in accordance with the CARES Act. The Company believes that the full amount of the $107,485 Paycheck Protection Program loan will be forgiven, and therefore, the entire loan is classified as a current liability in the accompanying Balance Sheet.

Interest expense for the years ended December 31, 2020 and 2019 was $710 and $0, respectively.

Convertible notes payable, net of debt discount consist of the following:

	December 31, 2020		December 31, 2019
Convertible note payable, secured, 12% interest, due August 31, 2019, in default		50,000		50,000
Convertible note payable, secured, 12% interest, due 120 days after delivery of payment notice from lender or November 1, 2019		-		900,000
Convertible note payable, secured, 12% interest, due February 1, 2021		100,000		100,000
Convertible note payable, secured, 12% interest, due February 15, 2021		50,000		50,000
Convertible note payable, secured, 12% interest, due May 22, 2020, in default		5,000		5,000
Convertible note payable, secured, 12% interest, due Feb 15, 2021		75,000		75,000
Convertible notes payable, secured, 4% interest, due October 14, 2020, in default		75,000		75,000
Convertible note payable, secured, 12% interest, due January 11, 2020		-		160,000
Convertible note payable, secured, 10% interest, due February 8, 2020, in default		50,000		50,000
Convertible note payable ,12% interest, due May 2020		-		337,000
Convertible note payable ,12% interest, due May 2020, in default		162,750		168,500
Convertible note payable, secured, 10% interest, due February 8, 2020, in default		50,000		50,000
Convertible note payable, secured, 12% interest, due on demand		44,060		31,500
Convertible note payable, secured, 10% interest, due October 2021		29,000		23,000
Convertible note payable, secured, 10% interest, due April 2022		26,000		-
Convertible note payable, secured, 10% interest, due May 2021, in default		350,000		-
Convertible note payable, secured, 10% interest, due October 18, 2021		26,083		-
Convertible notes payable, secured, 10% interest, due May through November 2022		435,000		-
Total convertible notes payable		1,527,893		2,075,000
Less unamortized discounts		(465,719)		(474,692)
Total convertible notes payable, net	$	1,062,174	$	1,600,308
Less current portion		(970,839)		(1,583,066)
Convertible notes payable, net - Long-term	$	91,335	$	17,242

On June 2, 2016, the Company issued $50,000 of principal amount of 12% secured convertible promissory notes and 50,000 warrants to purchase common stock. The note was due on August 31, 2018, was later extended to August 31, 2019, bears interest of twelve percent (12%) and is currently past due. The outstanding principal amounts and accrued but unpaid interest of the notes is convertible at any time at the option of the holder into common stock at a conversion price of $1.00 per share. The notes were issued with warrants to purchase up to 50,000 shares of the Company’s common stock at an exercise price of $1.50 per share. No payments were made and the balance was $50,000 as of December 31, 2020.

On May 2, 2017, the Company issued $100,000 of principal amount of 12% secured convertible promissory notes and 20,000 warrants to purchase common stock. The note was due on May 2, 2020 and is secured by the Company’s accounts receivable and inventory and on August 1, 2020, for the issuance of 50,000 shares valued at $10,000 based on market value of the shares of $0.20 on the date of issuance, was further extended to February 1, 2021. On April 20, 2021, the noteholder agreed to extend the maturity date of the note to May 2, 2022 for 100,000 shares of common stock (See note 12). The outstanding principal amounts and accrued but unpaid interest of the notes is

convertible at any time at the option of the holder into common stock at a conversion price of $0.50 per share. The notes were issued with warrants to purchase up to 10,000 shares of the Company’s common stock at an exercise price of $1.00 per share. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $669 and $1,005, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On May 2, 2017, the Company issued $50,000 of principal amount of 10% secured convertible promissory notes and 10,000 warrants to purchase common stock. The note was due on May 2, 2020 and is secured by the Company’s accounts receivable and inventory. On April 22, 2020, the note was extended to May 2, 2021. As of the date of filing the note has not been paid and is currently past due. The outstanding principal amounts and accrued but unpaid interest of the notes is convertible at any time at the option of the holder into common stock at a conversion price of $0.50 per share. The notes were issued with warrants to purchase up to 10,000 shares of the Company’s common stock at an exercise price of $1.00 per share. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $334 and $503, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On May 22, 2017, the Company issued $5,000 of principal amount of 10% secured convertible promissory notes and 1,000 warrants to purchase common stock at an exercise price of $1. The note was due on May 22, 2020 and is currently in default secured by the Company’s accounts receivable and inventory. The outstanding principal amounts and accrued but unpaid interest of the notes is convertible at any time at the option of the holder into common stock at a conversion price of $0.50 per share. The notes were issued with warrants to purchase up to 1,000 shares of the Company’s common stock at an exercise price of $1.00 per share. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $32 and $50, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On February 15, 2018, the Company issued a $75,000 12% secured convertible promissory note. The note was due on February 24, 2020 and is secured by the Company’s accounts receivable and inventory. On April 22, 2020, the due date of the note was extended to February 15, 2021 for the issuance of 50,000 shares of common stock valued at $8,995 based on market value of the shares of $0.18 on the date of issuance. On February 12, 2021, the Company issued 500,000 shares to extend the date of the note to February 15, 2022 (See note 12). The Company evaluated the modification under ASC 470-50 and determined that the modifications were considered substantial and qualified for extinguishment accounting under such guidance. As such the Company recorded a loss on extinguishment of debt of $8,995 associated with the excess reacquisition cost of the new debt over the carrying value of the original debt. No payments were made and the balance was $75,000 as of December 31, 2020.

On September 17, 2018, the Company issued a $50,000 10% promissory note. The note was due on September 18, 2020. As an incentive to enter into the agreement the noteholder was also granted 10,000 shares valued at $5,000, based on market value of the shares of $0.50 on the date of issuance. On February 9, 2019, the note was amended for the issuance of 50,000 shares of common stock valued at $30,000 based on market value of the shares of $0.60 on the date of issuance, which was recognized as a debt discount, additionally, the note holder agreed to change the conversion price of the note to a price of $0.50 per share. On February 8, 2021, the Company entered into an agreement to consolidate the notes into one $100,000, 10% note due February 8, 2022 convertible at $0.10 per share (See Note 12). Additionally, the maturity date of the note was changed to February 8, 2020 and the note is currently in default. As of December 31, 2020, the shares have not been issued and were included in stock payable. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $4,204 and $21,513, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On December 14, 2018, the Company issued a $50,000 4% convertible note. The note was originally due on February 14, 2019 and is convertible at a rate of $0.50 per shares. As an incentive to enter into the agreement, the noteholder was also granted 10,000 shares valued at $5,000, based on market value of the shares of $0.60 on the date of issuance, which was recognized as a debt discount. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $0 and $0, respectively, On February 14, 2019, the noteholder agreed to extend the note through October 14, 2020, and is in default as of December 31, 2020. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On January 25, 2019, the Company issued a $100,000 8% convertible note. The note was due on March 1, 2019 and is convertible at a rate of $0.50 per shares. On April 29, 2020, the note was amended to be due on demand but not before January 25, 2021 and the conversion price was changed to $0.10 per share. As consideration, the Company granted 140,000 three year warrants exercisable at $0.125 per share and valued at $21,836.

The Company evaluated the modification under ASC 470-50 and determined that the modifications were considered substantial and qualified for extinguishment accounting under such guidance. As such the Company recorded a loss on extinguishment of debt of $34,086 associated with the excess reacquisition cost of the new debt over the carrying value of the original debt. Additionally, the reduction of the conversion price resulted in a beneficial conversion feature totaling $12,250. The noteholder is due two shares of common stock for every dollar funded. As of December 31, 2020, the noteholder advanced a total of $79,660 and is due 194,320 shares valued at $56,314, based on market value of the shares on the date of the agreement, and the Company has made payments on the principal balance of $35,600. Subsequent to year end, the Company issued 157,920 shares that are due under the note and included in stock payable as of December 31, 2020 (See note 12).

As of December 31, 2020, there was an outstanding balance on the note in the amount of $44,060. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $6,250 and $31,250, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On February 8, 2019, the Company issued a $50,000 10% convertible note. The note was due on February 8, 2020 and is currently in default. As an incentive to enter into the agreement, the noteholder was also granted 60,000 shares valued at $30,000, which was recognized as a debt discount. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $3,205 and $26,795, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On February 19, 2019, the Company issued a $25,000 4% convertible note. The note was due on August 19, 2019 and is convertible at a rate of $0.50 per share. On February 14, 2019, the noteholder agreed to extend the note through October 14, 2020. As an incentive to enter into the agreement, the noteholder was also granted 5,000 shares valued at $2,500, which was recognized as a debt discount. As of December 31, 2020, the shares have not been issued and were included in stock payable. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $0 and $2,500, respectively. As of December 31, 2020, the note was shown net of unamortized discount of $0.

On October 18, 2019, the Company issued a $23,000 10% convertible note. The note is due on October 17, 2021 and is convertible at a rate of $0.50 per share. As an incentive to enter into the agreement, the noteholder was also granted 46,000 shares valued at $15,175, based on market value of the shares of $0.33 on the date of issuance, which was recognized as a debt discount. During the year ended December 31, 2020, the Company restructured the note to reduce the conversion price to $0.10 per share and the noteholder advanced another $6,000. As consideration, the Company issued an additional 12,000 shares of common stock valued at $4,560 and 232,000 warrants valued at $82,131. The Company evaluated the modification under ASC 470-50 and determined that the modifications were considered substantial and qualified for extinguishment accounting under such guidance. As such the Company recorded a loss on extinguishment of debt of $102,905 associated with the excess reacquisition cost of the new debt over the carrying value of the original debt.

On November 5, 2019, the Company entered into a $562,000 convertible note payable, including an original issue discount of $56,200 pursuant to which we borrowed $337,000, including a $37,000 original issue discount in the first tranche during the year ended December 31, 2019. Interest under the convertible promissory note is 12% per annum, and the principal and all accrued but unpaid interest was due 180 days from funding. The note is convertible at the lesser of (i) 70% multiplied by the lowest Trading Price during the previous twenty-five (25) trading day period ending on the latest complete Trading Day prior to the date of the note and 70% of the market price. As an incentive to enter into the agreement, the noteholder was also granted 854,000 shares valued at $307,440. The Company analyzed the conversion feature and determined it was required to be bifurcated and recognized as a derivative liability. The derivative at inception was valued at $392,061, based on the Black Scholes Merton pricing model. As the fair value of the derivative and the shares issued at inception were in excess of the face amount of the note, the Company recorded a debt discount in the amount of $337,000 to be amortized utilizing the effective interest method of accretion over the term of the note. On January 30, 2020, the Company borrowed an additional $225,000, including a $25,500 original issue discount. As an incentive, the noteholder was also granted an additional 476,493 shares valued at $147,713. The Company analyzed the conversion feature and determined it was required to be bifurcated and recognized as a derivative liability. The derivative at inception was valued at $212,798, based on the Black Scholes Merton pricing model. As the fair value of the derivative and the shares issued at inception were in excess of the face amount of the note, the Company recorded a debt discount in the amount of $225,000 to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the excess of $161,011 was recognized as a financing cost on the Statement of Operations. For the years ended December 31,

2020 and 2019, the Company recorded amortization of the debt discount of $457,735 and $104,265, respectively. As of December 31, 2020, $562,000 of the debt discount has been amortized and the note was shown net of unamortized discount of $0. On May 5, 2020, the Company paid the principal and accrued interest under the first tranche of $357,852 and on August 20, 2020, the Company paid the principal and accrued interest of the second tranche of $239,055. The fair value of the derivative liability associated with the first and second tranches on the date of settlement of $275,728 and $188,276, respectively were reclassified to additional paid in capital.

On November 19, 2019, the Company entered in to a $281,000 convertible note payable, including an original issue discount of $28,100 convertible promissory note pursuant to which $150,000 was borrowed, including a $18,500 discount during the year ended December 31, 2019. Interest under the convertible promissory note is 12% per annum, and the principal and all accrued but unpaid interest is due 180 days from funding.  The note is convertible at the lesser of (i) 70% multiplied by the lowest Trading Price during the previous twenty-five (25) trading day period ending on the latest complete Trading Day prior to the date of the note and 70% of the market price. As an incentive to enter into the agreement, the noteholder was also granted 427,000 shares valued at $175,070. The Company analyzed the conversion feature and determined it was required to be bifurcated and recognized as a derivative liability. The derivative at inception was valued at $192,226, based on the Black Scholes Merton pricing model. As the fair value of the derivative and the shares issued at inception were in excess of the face amount of the note, the Company recorded a debt discount in the amount of $168,500 to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the excess of $104,041 was recognized as a financing cost on the Statement of Operations On May 20, 2020, the noteholder agreed to extend the due date of the first tranche of funding until July 19, 2020 and is currently past due. On May 20, 2020, the Company incurred a default penalty of 50% of the balance of the note amounting to $54,250. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $129,401 and $39,099, respectively. As of December 31, 2020, $168,500 of the debt discount has been amortized and the note was shown net of unamortized discount of $0. As of December 31, 2020, the Company paid the $60,000 toward the principal balance under the first tranche of $60,000.

The fair value of the derivative liability associated with the tranche on the date of settlement of $62,448 was recorded to additional paid in capital. The fair value of the derivative liability associated with the default penalty of $49,051, was charged it to financing cost.

The embedded conversion feature in the convertible debt instruments above, dated November 5, 2019 and November 19, 2019, were convertible at issuance, which qualified them as a derivative instrument since the number of shares issuable under the note is indeterminate based on guidance in ASC 815-15, “Derivatives and Hedging (“Topic No. 815-15”). Topic No. 815-15 requires the Company to bifurcate and separately account for the conversion features as an embedded derivative contained in the Company’s convertible debt.

The Black-Scholes model, adopted by management as an appropriate financial model, utilized the following inputs to value the derivative liabilities at the date of issuance of the convertible note through December 31, 2020:

Risk free interest rate	0.08% - 1.57%
Expected term (years)	0.000 - 0.50
Expected volatility	263% - 367
Expected dividends	0%

On January 8, 2020, the Company issued a $26,083 convertible note. The note is due on January 8, 2022 and is convertible at a rate of $0.10 per shares. As an incentive to enter into the agreement, the noteholder was also granted 52,166 shares and 208,664 2-year warrants exercisable at $0.125. The issuance of the note and warrants resulted in a discount from the beneficial conversion feature totaling $26,083, including $13,203 attributable to the conversion feature, $10,566 attributable to the warrants, and $2,313 was attributable to the shares. The excess fair value of the consideration given of $19,823 was recorded as financing expense. For the years ended December 31, 2020 and 2019, the Company recorded amortization of the debt discount of $12,574. As of December 31, 2020, the note was shown net of unamortized discount of $13,509.

On May 1, 2020, the Company issued a $350,000 6% convertible note. The note is due on May 1, 2021 and is convertible at a rate of $0.125 per shares, resulting in a debt discount from a beneficial conversion feature $42,000. On April 30, 2021, the noteholder agreed to extend the maturity date of the note to May 1, 2022 for 100,000 shares of common stock (See note 12). As an incentive to enter into the agreement the noteholder was also granted

1,500,000 shares valued at $207,000, which was also recognized as a debt discount. For the year ended December 31, 2020, the Company recorded amortization of the debt discount of $166,455. As of December 31, 2020, the note was shown net of unamortized discount of $82,545.

On April 30, 2020, the Company issued a $100,000 8% convertible note. The note is due on April 30, 2022 and is convertible at a rate of $0.125 per shares which resulted in a discount from the beneficial conversion feature totaling 20,250. The note holder is due two shares of common stock and eight three-year warrants exercisable at a rate of $0.125 for every dollar funded. As of December 31, 2020, the noteholder advanced a total of $26,000 and is due 52,000 shares valued at $7,740, based on market value of the shares of $0.14 on the date of funding and 208,000 warrants valued at $26,000 which was recorded as financing expense. As of December 31, 2020, the 52,000 shares were not issued and were included in stock payable. For the year ended December 31, 2020, the Company recorded amortization of the debt discount of $11,546. As of December 31, 2020, the note was shown net of unamortized discount of $14,454.

During year ended December 31, 2020, we issued several secured convertible promissory notes dated between May 5th and November 25th, 2020, in the aggregate principal amount of $435,000 to several accredited investors through a private placement. The convertible notes bear interest at a rate of 10% per annum, mature two years from issuance. The notes and accrued interest are convertible at the option of the noteholders into our common stock at $0.125 per share. As an incentive to enter into the agreements the Company also issued 3,480,000 three year warrants exercisable at $0.125 per share. The issuance of the note and warrants resulted in a discount from the beneficial conversion feature totaling $435,000, including $178,565 attributable to the conversion feature, $256,435 attributable to the warrants (Note 9), which was recorded as a debt discount. During the years ended December 31, 2020, $79,789 of the discount was amortized and the note was shown net of unamortized discount of $355,211.

As part of the private placement, the Company paid a consultant a $50,000 retainer and commissions equivalent to 10% of the gross proceeds received from the issuance of convertible notes which were recorded as financing cost.

Interest expense including financing cost and amortization of the associated debt discount on all of the above convertible notes for the year ended December 31, 2020 and 2019 was $1,013,972 and $697,307, respectively.