Convertible Notes Payable

12 Months Ended

Jun. 30, 2024

Convertible Notes Payable

Convertible Notes Payable

Note 8 — Convertible Notes Payable

Convertible notes payable consisted of the following:

	June 30, 2024			June 30, 2023
September 2018 – Convertible note of $440,000 with interest rate at 10% per annum with maturity date of September 2019.		-			79,000
September 2018 – Convertible note of $220,000 with interest rate at 10% per annum with maturity date of September 2019.		220,000			220,000
March 2019 – Convertible note of $640,000 with interest rate at 7% per annum with maturity date of September 2020.		244,802			244,802
Total notes payable		464,802			543,802
Less current portion of notes payable		(464,802	)		(543,802	)
Notes payable, less current portion	$	-		$	-

·	September 2018 - $440,000
	On September 21, 2018, the Company entered into a convertible note with an investor of the Company with a face value of $440,000 in exchange for $400,000 cash payment with an interest rate of 10% per annum.   The discount of this note was amortized over the life of the note.   The key term of this convertible note is as follows:
	o	Twelve-month term with no payment required for the initial six months; after six months, the Company is required to repay investor interest and principal in six equal installments.
	o	The principal and interest of the note is convertible into the Company’s common stock at a purchase price of $0.70 per common share after the six months.
	o	If the Company defaults on this note, the interest is increased to 12% and at the investors’ option, the principal and interest can be converted into the Company’s common stock at a 20% discount to the then current market.
	o	The Company issued five-year warrants to purchase up to 200,000 common shares of the Company’s common stock at a price of $0.75 per share. The value assigned to the warrants of $125,723 has been fully amortized. The cash for this Convertible Note was received prior to September 30, 2018. As of June 30, 2023, the Convertible Note is payable upon demand and total unpaid principal and interest outstanding is approximately $355,834.
	As of June 30, 2024 and 2023, the total unpaid and accrued interest was $0 and $0, respectively.
·	September 2018 - $220,000
	During the year ended June 30, 2019, the Company entered a convertible note with an investor of the Company with a face value of $220,000 in exchange for $200,000 cash payment with an interest rate of 10% per annum.  The discount of this note was amortized over the life of the note.  The note is in default and payable upon demand.  As of June 30, 2024 and 2023, the total unpaid and accrued interest was $149,829 and $123,417, respectively, and is recorded in accrued liabilities.
·	March 2019 - $640,000
	During the year ended June 30, 2019, the Company entered into two promissory notes with an investor of the Company with a face value of $640,000 in exchange for a total of $600,000 cash payment. The discount of the Notes was amortized over the life of the Note and has an interest rate of 7%. The remaining principal is in default and payable upon demand and included as current debt on the balance sheet. As of June 30, 2024 and 2023, the total unpaid and accrued interest was $159,871 and $123,097, respectively, and is recorded in accrued liabilities.

Total interest expense on convertible notes payable was $63,186 and $57,341 for the years ended June 30, 2024 and 2023, respectively.