Stockholders’ deficit

12 Months Ended

Sep. 30, 2022

Equity [Abstract]

Stockholders’ deficit

Note 6. Stockholders’ deficit

Preferred Stock

Our authorized preferred stock consists of 20,000,000 shares of $0.001 par value preferred stock.

Series A Preferred Stock – Our board of directors has designated up to 6,000,000 shares of Series A Preferred Stock. The Series A Preferred Stock has a liquidation value of $2.00 per share. The initial number issued is 5,000,000 with additional shares to be issued as a dividend not to exceed a total of 6,000,000 shares. The rank of the Series A is prior to all common and preferred shares. In addition, the Series A Preferred Stock retains protective provisions to maintain their seniority with respect to liquidation or dissolution. The Series A Preferred Stock holds no voting rights and earns an 8% per annum dividend, payable in additional shares of Series A Preferred Stock. At September 30, 2022 and 2021, there were no shares of our Series A Preferred Stock outstanding, respectively.

Series B Preferred Stock – Our board of directors has designated up to 1,000,000 shares of Series B Preferred Stock. The Series B Preferred Stock has a liquidation value of $1.00 per share. The holders of the Series B Preferred Stock are entitled to dividends of 8% per year payable quarterly in cash or in shares of common stock at the option of the Company. The holders of the Series B Preferred Stock have no voting rights. The Series B Preferred Stock is redeemable at the option of the Company at a price of $1.00 per share. At September 30, 2022 and 2021, there were no shares of our Series B Preferred Stock outstanding.

Series C Preferred Stock – On September 12, 2017, our board of directors designated up to 1,200,000 shares of Series C Preferred Stock with a liquidation value of $0.50 per share. The holders of the Series C Preferred Stock have no voting rights. The Series C Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of one share of common stock for each share of Series C Preferred Stock. The Series C Preferred Stock is redeemable at the option of the Company at a price of $0.50 per share. The Series C Preferred Stock has been canceled, and there are no shares of Series C Preferred Stock outstanding as of September 30, 2022 and 2021.

Series D Preferred Stock – On September 21, 2017, our board of directors designated up to 539,988 shares of Series D Preferred Stock with a liquidation value of $1.00 per share. The holders of the Series D Preferred Stock have no voting rights. The Series D Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of $0.01 per share of common stock. The Series D Preferred Stock is not redeemable. At September 30, 2022 and 2021, there were 509,988 shares of Series D Preferred Stock outstanding.

Series E Preferred Stock – On August 3, 2015, our board of directors designated 1,000,000 shares of Series E Preferred stock. The Series E Preferred stock is subordinate to our common stock. It does not receive dividends and does not participate in equity distributions. The Series E Preferred stock retained 2/3 of the voting rights in the Company.

At September 30, 2022 and 2021, there were 1,000,000 shares of Series E Preferred stock outstanding. Dividends, when, as and if declared by the Board of Directors, shall be paid out of funds at the time legally available for such purposes.

Series F Preferred Stock – On September 21, 2017, our board of directors designated up to 501,975 shares of Series F Preferred Stock with a liquidation value of $1.00 per share. The holders of the Series F Preferred Stock have no voting rights. The Series F Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of $0.01 per share of common stock. The Series F Preferred Stock is not redeemable. At September 30, 2021, 386,975 shares of the Series F Preferred Stock were issued and outstanding. During the year ended September 30, 2022, 257,984 shares of Series F Preferred Stock was converted into 25,798,400 shares of common stock. At September 30, 2022, 128,991 shares of the Series F Preferred Stock were issued and outstanding.

Conversions to Common Stock of Convertible Notes Payable

During the year ended September 30, 2021, the holders of the convertible notes payable elected to convert principal and accrued interest of $291,500 into 40,817,050 shares of common stock. There was no gain or loss recognized as the conversion occurred in accordance with the original terms of the agreement.

Common stock issued for services

In March 2021, the Company entered into severance agreement with its former CEO Alex Blankenship. The Company owed Ms. Blankenship unpaid compensation of $130,000 and agreed to issue 8,600,000 shares of common stock in full settlement of this amount and release from the employment agreement with her. The shares had a fair value of $447,200 based on the stock price at the date of the agreement. The Company recognized a loss on settlement of $317,200 in connection with this agreement. The Company also issued an additional 2,600,000 shares to Ms. Blankenship with a fair value of $102,700 in connection with this agreement, which were included in the loss on settlement total of $419,900 for the year ended September 30, 2021. Concurrently with the severance agreement, the Company agreed to purchase the 1,000,000 shares Series E Preferred Stock held by Ms. Blankenship for $325,000 in cash. The Company reissued those Series E preferred Shares to the Company’s new CEO James Katzaroff. The Company recognized stock-based compensation of $325,000 related to this reissuance.

During the year ended September 30, 2021, the Company issued a total of 15,000,000 shares to three individuals for services rendered, including 5,000,000 to the Company’s CFO. The shares had a total fair value of $717,500 based on the stock price at the date the shares were earned, which was recognized as stock-based compensation.

Common stock issued for settlement of liabilities

During the year ended September 30, 2022, the Company issued 6,000,000 shares of common stock and 900,000 warrants for the settlement of liabilities totaling $15,000. The Company recorded a $146,460 loss on settlement of liabilities related to this transaction

Common stock issued for stock payable

In December 2021, the Company issue 19,980,000 shares of common stock as part of the common stock unit sales that occurred during the year ended September 30, 2021. As of September 30, 2022, no shares are remaining to be issued for these unit sales.

In September 2022, the Company received $5,000 of cash as a subscription for 1,515,152 shares of common stock and an equal number of warrants to purchase common stock at an exercise price of $0.01 for one year. The common shares were not yet issued as of September 30, 2022.

Common Stock Units

During the year ended September 30, 2021 the Company sold common stock units to investors. Each unit consist of 400,000 shares of common stock and 600,000 warrants to purchase common stock for three years at an exercise price of $0.03 per share. The Company received cash proceeds of $499,500 related to the issuance of 19,980,000 shares of common stock and 29,970,000 warrants. No shares of common stock were issued as of September 30, 2021. The shares were issued in December 2021. The warrants had a relative fair value of $350,462 based on a Black-Scholes pricing model with estimated volatility ranging from 261.3% to 261.8%, dividend yield of 0%, expected term of three years and a risk free rate ranging from 0.19% to 0.24%. As of September 30, 2021, the warrants had no intrinsic value, and a weighted average remaining life of 2.4 years.

Common Stock Warrants

As discussed in Note 7 below, the Company awarded common stock warrants to a consultant. The Company recognized $322,266 of expense related to these warrants during the year ended September 30, 2022. The Company estimated the fair value of the warrants based on a Black-Scholes pricing model using the following assumptions: 1) volatility of 254.43%; 2) risk free rate of 1.76%; 3) dividend yield of 0% and 4) expected term of 5 years. The following table summarizes the stock warrant activity for the years ended September 30, 2022 and 2021:

	Warrants		Weighted-Average Exercise Price Per Share
Outstanding, September 30, 2020		—	$	—
Granted		29,970,000		0.03
Exercised		—		—
Forfeited		—		—
Expired		—		—
Outstanding, September 30, 2021		29,970,000	$	0.03
Granted		41,415,152		0.01
Exercised		—		—
Forfeited		—		—
Expired		—		—
Outstanding, September 30, 2022		71,385,152	$	0.02

As of September 30, 2022, the outstanding warrants had an expected remaining life of 2.99 years and have no intrinsic value.

Common Stock Options

As discussed in Note 4, The Company awarded common stock options to Mr. Katzaroff in connection with his amended and restated employment agreement. The Company estimated the fair value of the options to be $284,840, using the following assumptions: 1) volatility of 254.43%; 2) risk free rate of 1.54%; 3) dividend yield of 0% and 4) expected term of 3.38 years. The Company recognized $186,926 of expense related to the fair value of options vesting during the year ended September 30, 2022. The Company expects to recognize an additional $97,914 of expense related to these options assuming all vest.

During the year ended September 30, 2021, the Board of Directors approved grants of 70,000,000 options to officers and medical advisory board members. The stock options have an exercise price of $0.03 per share and are exercisable through the latter of two years from the effective date or two years after certain liquidity events. The total fair value of these option grants at issuance was $4,209,179. All options vested immediately.

The following table summarizes the stock option activity for the years ended September 30, 2022 and 2021:

	Options		Weighted-Average Exercise Price Per Share
Outstanding, September 30, 2020		—	$	—
Granted		70,000,000	$	0.003
Exercised		—	$	—
Forfeited		—	$	—
Expired		—	$	—
Outstanding, September 30, 2021		70,000,000	$	0.003
Granted		35,000,000	$	0.01
Exercised		—	$	—
Forfeited		—	$	—
Expired		—	$	—
Outstanding, September 30, 2022		105,000,000	$	0.02

As of September 30, 2022, the aggregate intrinsic value of options vested and outstanding were $0. As of September 30, 2022, all outstanding options had an expected remaining life of 1.86 years.

Beneficial Conversion Feature

During the year ended September 30, 2021, the Company charged to additional paid-in capital the aggregate amount of $225,000, in connection with the beneficial conversion feature of notes payable.