Item 2. Unregistered Sales of Equity Securities
ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds
On March 6, 2023, we issued 320,000 shares of our common stock, restricted in accordance with Rule 144, to two consultants for services.
On January 24, 2023, we entered into a Securities Purchase Agreement for the sale of convertible notes in the aggregate principal amount of $388,888, and warrants to acquire 7,421,544 shares of our common stock at an exercise price of $0.04716 per share, to two investors. The Notes contained an original issue discount of 10%, and thus the proceeds to us was $350,000. The Notes do not bear interest unless we are in default, have a maturity date of October 24, 2023, and all amounts are payable on the maturity date. The Notes are convertible into our common stock at the election of the holder at means ninety percent (90%) of the lowest VWAP of our common stock for the five (5) consecutive Trading Days immediately preceding the date of the issuance of a Conversion Election.
On March 20, 2023, we entered into a Promissory Note and a Common Stock Purchase Warrant with a single investor. The note is in the principal amount of Three Hundred Thirty Thousand Dollars ($330,000), had an original issue discount of 10% (or $30,000) and bears interest at a rate of ten percent (10%) per annum. Fifteen (15) monthly payments of $23,359.15 are due between the issue date and the maturity date of September 17, 2024. The warrants are to acquire three million three hundred thousand (3,300,000) shares of our common stock, are exercisable for three (3) years at an exercise price of $0.05 per share, and contain a cashless exercise option for the holder. The proceeds from the note were used to pay off and consolidate other outstanding debt obligations, significantly reducing our monthly cash payments.
The issuances were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, there was no solicitation involved in the offerings, and the parties were either sophisticated or accredited.
ITEM 3 Defaults Upon Senior Securities
There have been no events which are required to be reported under this Item.
ITEM 4 Mine Safety Disclosures
Not applicable.
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