| CONVERTIBLE NOTES PAYABLE, INCLUDING RELATED PARTY |
NOTE 3 – CONVERTIBLE NOTES PAYABLE, INCLUDING RELATED PARTY
Convertible notes payable at June 30, 2017 and December 31, 2016 consist of the following:
| |
|
June 30, |
|
|
December 31, |
|
| |
|
2017 |
|
|
2016 |
|
| Convertible notes to stockholder due on various dates through August 24, 2016; interest at 4%; convertible in shares of common stock at 90% of the Company's stock price at date of conversion. (in default at June 30, 2016) |
|
$ |
59,599 |
|
|
$ |
59,599 |
|
| Convertible note to investor due on September 22, 2017; interest at 10%; included an original issue discount of $7,245; convertible in shares of common stock at 50% of the Company's stock price at date of conversion. |
|
|
19,571 |
|
|
|
56,750 |
|
| Convertible note to investor due on July 3, 2017; interest at 10%; convertible in shares of common stock at 50% of the Company's stock price at date of conversion. |
|
|
34,101 |
|
|
|
58,745 |
|
| Convertible note to investor due on January 11, 2017; interest at 12%; convertible in shares of common stock at 50% of the Company's stock price at date of conversion. |
|
|
65,000 |
|
|
|
- |
|
| Convertible note to investor due on January 11, 2017; interest at 8%; convertible in shares of common stock at 58% of the Company's stock price at date of conversion. |
|
|
58,000 |
|
|
|
- |
|
| Convertible note to investor due on January 12, 2017; interest at 6%; convertible in shares of common stock at 55% of the Company's stock price at date of conversion. |
|
|
38,066 |
|
|
|
- |
|
| Convertible note to investor due on February 15, 2017; interest at 12%; convertible in shares of common stock at 58% of the Company's stock price at date of conversion. |
|
|
43,000 |
|
|
|
- |
|
| Convertible note to investor due on February 20, 2017; interest at 10%; convertible in shares of common stock at 50% of the Company's stock price at date of conversion. |
|
|
56,750 |
|
|
|
- |
|
| Convertible note to investor due on June 1, 2017; interest at 12%; convertible in shares of common stock at 58% of the Company's stock price at date of conversion. |
|
|
23,000 |
|
|
|
- |
|
| |
|
|
397,087 |
|
|
|
175,094 |
|
| Less debt discount |
|
|
(153,176 |
) |
|
|
(80,796 |
) |
| Convertible notes, net of discount |
|
$ |
243,911 |
|
|
$ |
94,298 |
|
| |
|
|
|
|
|
|
|
|
| Convertible notes payable - related party |
|
$ |
59,599 |
|
|
$ |
59,599 |
|
| Less debt discount |
|
|
- |
|
|
|
- |
|
| Convertible notes - related party, net of discount |
|
$ |
59,599 |
|
|
$ |
59,599 |
|
| |
|
|
|
|
|
|
|
|
| Convertible notes payable - unrelated parties |
|
$ |
337,488 |
|
|
$ |
115,495 |
|
| Less debt discount |
|
|
(153,176 |
) |
|
|
(80,796 |
) |
| Convertible notes - unrelated parties, net of discount |
|
$ |
184,312 |
|
|
$ |
34,699 |
|
During the six months ended June 30, 2017, the Company issued convertible notes in the aggregate principal amount of $295,750, with original issue discounts of $19,250. Due to the variable conversion price associated with these convertible notes, the Company has determined that the conversion feature is considered derivative liabilities. The embedded conversion feature was initially calculated to be $743,375, which is recorded as a derivative liability as of the date of issuance. The derivative liability was first recorded as a debt discount up to the face amount of the convertible notes of $295,750, with the remainder being charge as a financing cost during the period. The debt discount is being amortized over the terms of the convertible notes. The Company recognized interest expense of $223,370 during the six months ended June 30, 2017 related to the amortization of the debt discount.
A rollfoward of the convertible notes payable from December 31, 2016 to June 30, 2017 is below:
| Convertible notes payable, December 31, 2016 |
|
$ |
94,298 |
|
| Issued for cash |
|
|
276,500 |
|
| Issued for original issue discount |
|
|
19,250 |
|
| Penalties added to convertible notes payable balance |
|
|
14,719 |
|
| Conversion into common stock |
|
|
(88,476 |
) |
| Debt discount related to new convertible notes |
|
|
(295,750 |
) |
| Amortization of debt discounts during the period |
|
|
223,370 |
|
| Convertible notes payable, June 30, 2017 |
|
$ |
243,911 |
|
|