Notes Payable and Note payable-other

6 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Notes Payable and Note payable-other

Note 7 – Notes Payable and Note payable-other

Notes payable consists of notes payable from our subsidiary, notes payable-other, convertible notes payable, notes payable for stock purchases under Reg A, short term notes payable, and notes payable-BOAPIN portal, as follows: 

	December 31, 2022		June 30, 2022
Notes from subsidiary	$	159,134	$	174,243
Notes payable – Reg A deposits		138,856		138,856
Short term bridge loan		100,000		100,000
Total Notes Payable	$	397,990	$	413,099

Notes Payable - subsidiary

The Company has various loans and credit lines outstanding. The credit line carries an interest rate of 6.24%. The bank loans carry interest rates varying between 9.24% – 10.90%.

	December 31, 2022		June 30, 2022
Wells Fargo Loan	$	8,770	$	8,770
On Deck Loan		139,569		139,569
Susquehanna Salt Loan		–		10,500
Prosper Loans		9,994		9,994
Marcus Loan		801		5,410
Total Notes from Subsidiary (See Table Above)	$	159,134	$	174,243

Short term bridge loan - COHEN

On July 31, 2020, the Company secured a $500,000 short term bridge loan from an unaffiliated individual (“COHEN”), 12% interest, due and payable October 20, 2020. The loan is currently in default and continues to accrue interest at 12%.

On August 19, 2021, the Company repaid $300,000 of principal and in November 2021, the Company repaid an additional $100,000 in principal.

At December 31, 2022 and June 30, 2022, the Company recorded a short term note payable of $100,000, respectively. During the three and six months ended December 31, 2022, the Company expensed $3,000 and $6,000 in interest expense, respectively. During the three and six months ended December 31, 2021, the Company expensed $4,668 and $15,649, respectively. The accrued interest payable at December 31, 2022 and June 30, 2022 was $82,677 and $76,677, respectively. These notes are included in the Notes payable total on the Company’s balance sheet.

Note payable – stock purchases under Reg A

In March 2021 and June 2021, the Company accepted payments of $115,000 for stock purchases under the Reg A filing from two unaffiliated investors, pending blue sky registrations in two states. In July 2021, the Company accepted loans totaling $20,000 from two unaffiliated investors pending blue sky registrations in two additional states. The notes mature in one year and bear interest at 5%. The full amount of the note plus interest is convertible at the Reg A fixed price of $0.01, when possible.

In October 2021, the Company accepted a loan of $5,000 from two unaffiliated investors pending blue sky registrations in two additional states.

At December 31, 2022 and June 30, 2022, the Company has recorded $138,856 and $138,856 in notes payable for stock purchases under Reg A. During the three and six months ended December 31, 2022, the Company recorded interest expense of $2,700 and $5,400, respectively. During the three and six months ended December 31, 2021, the Company recorded interest expense of $2,700 and $8,736, respectively. The accrued interest payable at December 31, 2022 and June 30, 2022 was $17,707 and $12,307, respectively. These notes are included in the Notes payable total on the Company’s balance sheet.

Note Payable – Other

In November, 2016, the Company secured a $50,000 loan from a party related to a previous CEO, bearing 4% interest, the loan maturing after a successful money raise of $1,000,000 through the acquisition of convertible notes payable (See BENZA, D2CF). The $1,000,000 fundraising was never completed, and the Company has been accruing interest on the original principal amount at 4% since inception. On July 22, 2021, the Company filed suit for damages and the party filed a countersuit on August 26, 2021. There has been no resolution to this situation, and we continue to accrue interest at the face amount.

During the three and six months ended December 31, 2022, the Company recorded interest expense of $500 and $1,000, respectively. During the three and six months ended December 31, 2021, the Company recorded interest expense of $500 and $1,000, respectively. The accrued interest payable at December 31, 2022 and June 30, 2022 was $12,282 and $11,282, respectively. These notes are included in the Notes payable total on the Company’s balance sheet.

Convertible note payable – BENZA, D2CF

On March 1, 2016 and March 3, 2016, the Company closed a private placement of debt and received an aggregate of $612,500 by issuing $13,750 (“B2CF”) and $660,000 (“BENZA”) unsecured convertible notes (“convertible notes”) and warrants to two investors, net of original issue discount of $61,250 per the subscription agreements, maturity at March 1, 2017 and March 3, 2017, respectively, bearing 0% interest and 18% default interest. The notes are currently in default, and all outstanding warrants have expired.

The Company is currently in negotiations to settle the $660,000 BENZA loan with principles in the company, although there has been no settlement to date.

As of December 31, 2022 and June 30, 2022, the Company reported $673,750 and $673,750 in convertible notes payable, respectively.

Convertible Note – Leonite Capital, LLC

On December 5, 2022, the Company, (the “Borrower”), received $250,000 on issuing the first tranche of $1,000,000 senior secured convertible note (“Leonite Convertible Note”) from Leonite Capital, LLC, a Delaware limited liability company (“Leonite”), net of an original issue discount of $62,500. The term of the convertible note is fifteen months from the date of closing and matures on March 5, 2024. The Company is required to only pay interest expense on a monthly basis for the first six months of the term. During the three and six months ended December 31, 2022, the Company accrued $2,382 of interest expense related to the convertible notes. The Company will begin making nine equal amortization payments of $34,722 commencing in the month of July 2023. The last three months of the scheduled amortization payments are recorded as long-term convertible notes totaling $104,167 on the Company’s balance sheet at December 31, 2022. The Company is required to issue 15,000,000 commitment shares valued at $78,000 to Leonite of which $28,064 was charged to common stock to be issued. In addition, the Company also paid Leonite $10,000 for legal fees incurred by Leonite related to this transaction. The commitment shares and the legal fees have been recorded as deferred debt issuance costs totaling $59,936. The Company amortized $3,480 of the deferred debt issuance costs during the three and six months ended December 31, 2022 and the Company also amortized $3,629 of the original issue discount during the three and six months ended December 31, 2022. The Leonite Convertible Note bears annual interest at the greater of 10% or the Prime Rate plus three percent (3%). The Leonite Convertible Note is convertible into shares of the Company’s common stock at a conversion price equal to $0.007 per share with anti-dilution features.

Credit line – MediPendant New York Inc.

On September 30, 2014, our subsidiary entered into a line of credit with Medi Pendant New York, Inc. (“MNY”), which is partially owned by a principal of its subsidiary. Under the line of credit agreement, the Company will be able to borrow up to $500,000 with the rate of interest of 6.5% per annum. The maturity date of the credit line is September 30, 2017, with a one-year extension to September 30, 2018. On January 31, 2015, the limit on the line of credit was increased to $500,000 with same interest rate and due date. The company issued 200,000 shares of common stock to one of the owners of MNY as consideration for the increase of line of credit. These shares were issued on October 19, 2015 and value at $28,000 which was the fair market value at the grant date.

As of December 31, 2022 and June 30, 2022, the Company has recorded $397,500 and $397,500 in outstanding line of credit balance, respectively.

Debt settlement – On Deck, Susquehanna, MCA Cure

In 2019, our subsidiary engaged MCA CURE to negotiate settlements with two creditors: On Deck and Susquehanna Salt, noted in the table above. The Company ceased paying the loan payments and paid to MCA Cure $43,875 in 2019 and $47,000 in 2020, at which point the Company was contacted and MCA Cure assured they had enough funds to negotiate with the creditors. In 2020, the Company discovered MCA Cure had not performed when bank accounts were levied for $33,705 by the creditors. $18,705 was subsequently refunded by the collection firm. On September 30, 2020, the bank accounts were again levied for additional funds. Currently the Company has a settlement agreement in place with Susquehanna Salt Loan, and has booked a reserve against the $90,875 funds paid to MCA Cure. The Company has hired an attorney and is making every effort to recover funds and damages from MCA Cure. To date, there has been no resolution to the situation. As of December 31, 2022 and June 30, 2022, the Company recorded $-0- and $-0- in prepaid fund to MCA Cure, and $139,569 and $139,569 in indebtedness to On Deck. The Company negotiated a settlement with Susquehanna Salt for the loan balance, and as of December 31, 2022 and June 30, 2022, the Company recorded indebtedness to Susquehanna Salt of $-0- and $10,500, respectively.