IIOT-OXYS, Inc. 10-Q

Item 1. Financial Statements IIOT-OXYS, Inc. and Subsidiaries Condensed Consolidated Balance Sheets June 30, 2023 December 31, 2022 ASSETS (Unaudited) Current Assets Cash and cash equivalents $ 7,896 $ 33,336 Accounts receivable, net 25,353 28,941 Prepaid expenses and other current assets 12,760 7,773 Total Current Assets 46,009 70,050 Note receivable, net of discount of $ 2,856 and $ 4,716 at June 30, 2023 and December 31, 2022, respectively 197,144 195,284 Intangible assets, net 224,038 248,585 Total Assets $ 467,191 $ 513,919 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities Accounts payable $ 214,967 $ 133,408 Accrued liabilities 469,032 395,714 Deferred revenue 31,425 31,425 Unearned interest 2,219 5,151 Notes payable - current 310,000 363,167 Shares payable to related parties 17,629 14,624 Salaries payable to related parties 305,183 263,516 Derivative liabilities 626,563 469,873 Total Current Liabilities 1,977,018 1,676,878 Notes payable 124,300 104,300 Due to stockholders 1,000 1,000 Total Liabilities 2,102,318 1,782,178 Commitments and Contingencies (Note 4) – – Series B Convertible Preferred Stock, 600 shares designated, $0.001 Par Value, $ 1,200 stated value; 454 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively. Liquidation preference $ 544,800 at June 30, 2023 and December 31, 2022, respectively 544,800 544,800 Stockholders' Equity (Deficit) Series A Preferred Stock, $ 0.001 par value, 10,000,000 Shares authorized; 25,845 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively 26 26 Common Stock $ 0.001 Par Value, 1,000,000,000 shares authorized; 406,815,293 shares and 352,174,583 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively 406,816 352,175 Additional paid in capital 7,181,596 7,141,877 Accumulated deficit ( 9,768,365 ) ( 9,307,137 ) Total Stockholders' Equity (Deficit) ( 2,179,927 ) ( 1,813,059 ) Total Liabilities and Stockholders' Equity $ 467,191 $ 513,919 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 IIOT-OXYS, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) For The Three Months Ended June 30, For The Six Months Ended June 30, 2023 2022 2023 2022 Revenues $ 35,289 $ 16,500 $ 78,572 $ 16,500 Cost of Sales 8,495 510 25,459 510 Gross Profit 26,794 15,990 53,113 15,990 Operating Expenses General and administrative 117,739 217,621 283,938 384,630 Amortization of intangible assets 12,341 12,341 24,547 24,547 Total Operating Expenses 130,080 229,962 308,485 409,177 Other Income (Expense) Gain (Loss) on change in FMV of derivative liability ( 155,398 ) 36,057 ( 156,690 ) 151,856 Loss on derivative – – – ( 201,943 ) Interest income 5,921 5,661 11,777 5,661 Interest expense ( 13,996 ) ( 16,319 ) ( 28,524 ) ( 263,691 ) Total Other Income (Expense) ( 163,473 ) 25,399 ( 173,437 ) ( 308,117 ) Net Loss Before Income Taxes ( 266,759 ) ( 188,573 ) ( 428,809 ) ( 701,304 ) Provision for Income Tax – – – – Net Loss $ ( 266,759 ) $ ( 188,573 ) $ ( 428,809 ) $ ( 701,304 ) Convertible Preferred Stock Dividend ( 16,299 ) ( 12,280 ) ( 32,419 ) ( 24,708 ) Net Loss Attributable to Common Stockholders $ ( 283,058 ) $ ( 200,853 ) $ ( 461,228 ) $ ( 726,012 ) Net Loss Per Share Attributable to Common Stockholders - Basic and Diluted $ ( 0.00 ) $ ( 0.00 ) $ ( 0.00 ) $ ( 0.00 ) Weighted Average Shares Outstanding Attributable to Common Stockholders - Basic and Diluted 405,346,758 256,513,245 389,868,003 240,541,359 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 IIOT-OXYS, Inc. and Subsidiaries Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) For the three months ended June 30, 2023 Preferred Stock Common Stock Additional Paid-In Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance - March 31, 2023 25,845 $ 26 401,865,786 $ 401,866 $ 7,179,122 $ ( 9,485,307 ) $ ( 1,904,293 ) Common stock issued for conversion of convertible note payable – – 4,949,507 4,950 2,475 – 7,424 Net loss – – – – – ( 283,058 ) ( 283,058 ) Balance - June 30, 2023 25,845 $ 26 406,815,293 $ 406,816 $ 7,181,597 $ ( 9,768,365 ) $ ( 2,179,927 ) For the six months ended June 30, 2023 Preferred Stock Common Stock Additional Paid-In Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance - December 31, 2022 25,845 $ 26 352,174,584 $ 352,175 $ 7,141,877 $ ( 9,307,137 ) $ ( 1,813,059 ) Common stock issued for financing commitments – 31,603,364 31,603 22,592 – 54,195 Sales commissions paid on capital raise – – – – ( 1,084 ) – ( 1,084 ) Common stock issued for services – – 250,000 250 575 – 825 Common stock issued for conversion of convertible note payable – – 22,787,345 22,788 17,637 – 40,425 Net loss – – – – – ( 461,228 ) ( 461,228 ) Balance - June 30, 2023 25,845 $ 26 406,815,293 $ 406,816 $ 7,181,597 $ ( 9,768,365 ) $ ( 2,179,927 ) For the three months ended June 30, 2022 Preferred Stock Common Stock Additional Paid-In Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance - March 31, 2022 25,896 $ 26 237,205,464 $ 237,206 $ 6,783,471 $ ( 8,755,416 ) $ ( 1,734,713 ) Common Stock Issued for Financing Commitments – – 32,337,487 32,337 247,202 – 279,539 Sales commissions paid on capital raise – – – – ( 5,590 ) – ( 5,590 ) Common stock issued for conversion of convertible note payables – – 11,250,000 11,250 78,750 – 90,000 Net Income (loss) – – – – – ( 200,853 ) ( 200,853 ) Balance - June 30, 2022 25,896 $ 26 280,792,951 $ 280,793 $ 7,103,833 $ ( 8,956,269 ) $ ( 1,571,617 ) For the six months ended June 30, 2022 Preferred Stock Common Stock Additional Paid-In Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance - December 31, 2021 25,896 $ 26 220,254,396 $ 220,255 $ 7,059,098 $ ( 8,544,232 ) $ ( 1,264,853 ) Common Stock Issued for Financing Commitments – – 49,188,555 49,188 344,177 – 393,365 Sales commissions paid on capital raise – – – – ( 7,867 ) – ( 7,867 ) Common Stock Issued for Services – – 100,000 100 800 – 900 Common stock issued for conversion of convertible note payables – – 11,250,000 11,250 78,750 – 90,000 Beneficial Conversion Feature Associated with Discounts – – – – ( 371,125 ) 313,975 ( 57,150 ) Net Loss – – – – – ( 726,012 ) ( 726,012 ) Balance - June 30, 2022 25,896 $ 26 280,792,951 $ 280,793 $ 7,103,833 $ ( 8,956,269 ) $ ( 1,571,617 ) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 IIOT-OXYS, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) For the Six Months Ended June 30, 2023 2022 Cash Flows From Operating Activities Net loss $ ( 461,228 ) $ ( 726,012 ) Adjustments to reconcile net loss to net cash (used) by operating activities Stock compensation expense for services 825 900 Discount on note receivable ( 1,860 ) 6,606 Amortization of debt discount on notes payable and preferred stock – 37,400 Amortization of intangible assets 24,547 24,547 Changes in Operating Assets and Liabilities (Increase) Decrease in: Accounts receivable 3,588 ( 16,500 ) Prepaid expenses and other current assets ( 4,987 ) – Increase (Decrease) in: Accounts payable 81,559 ( 4,371 ) Accrued liabilities 80,574 53,280 Derivative liability 156,690 241,591 Unearned interest ( 2,932 ) 15,233 Shares payable to related parties 3,006 8,604 Salaries payable to related parties 41,667 11,899 Net Cash Used by Operating Activities ( 78,551 ) ( 346,823 ) Cash Flows from Investing Activities Cash paid for note receivable – ( 200,000 ) Net Cash used in Investing Activities – ( 200,000 ) Cash Flows from Financing Activities Cash received from sale of common stock 54,195 393,365 Cash payments of offering costs ( 1,084 ) ( 7,867 ) Proceeds from sale of Series B Preferred Stock – 188,000 Net Cash Provided By Financing Activities 53,111 573,498 Net Increase (Decrease) in Cash and Cash Equivalents ( 25,440 ) 26,675 Cash and Cash Equivalents - Beginning of Period 33,336 46,821 Cash and Cash Equivalents - End of Period $ 7,896 $ 73,496 Supplement Disclosures of Cash Flow Information Interest paid $ – $ – Income taxes paid $ – $ – Supplemental Disclosures of Non-Cash Investing and Financing Activities Conversion of convertible notes payable and derivative liabilities $ 40,425 $ – Effect of adopting ASU-2020-06 $ – $ 57,149 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 IIOT-OXYS, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements June 30, 2023 and 2022 (Unaudited) NOTE 1 - NATURE OF OPERATIONS, BASIS OF PRESENTATION AND GOING CONCERN Unless otherwise indicated, any reference to “the Company”, “we”, “us”, or “its” refers to IIOT-OXYS, Inc., a Nevada corporation, and as applicable to its wholly-owned subsidiaries, OXYS Corporation, a Nevada corporation, and HereLab, Inc., a Delaware corporation. IIOT-OXYS, Inc., incorporated in Nevada on July 6, 2017, (the “ Company ”) was established for the purpose of designing, building, testing, and selling Edge Computing Systems for the Industrial Internet. The Company is currently devoting substantially all its efforts in identifying, developing and marketing engineered products, software and services for applications in the Industrial Internet which involves collecting and processing data collected from a wide variety of industrial systems and machines. Impact of COVID-19 The global COVID-19 pandemic continues to present uncertainty and unforeseeable risks to the Company’s operations and business plan. The Company has closely monitored recent developments, including the lifting of COVID-19 safety measures, the spread of new strains or variants of the coronavirus (such as the Delta and Omicron variants), and supply chain and labor shortages. Thus, the full impact of the COVID-19 pandemic on the business and operations remains uncertain and will vary depending on the pandemic’s future impact on the third parties with whom the Company does business, as well as any legal or regulatory consequences resulting therefrom. The Company has been following the recommendations of health authorities to minimize exposure risk for its team members and may take further actions that alter our operations, including any required by federal, state or local authorities, or that it determines are in the best interests of its employees and other third parties with whom the Company does business. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“ GAAP ”) and include the accounts of the Company. The financial statements and accompanying notes are the representations of the Company’s management, who is responsible for their integrity and objectivity. In the opinion of the Company’s management, the financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. Going Concern The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying financial statements, the Company has suffered continuing operating losses, has a working capital deficit of $ 1,931,009 , used cash flows in operating activities of $ 78,551 , and has an accumulated deficit of $ 9,768,365 as of June 30, 2023. These factors, among others, raise a substantial doubt about the Company’s ability to continue as a going concern. If the Company is unable to obtain adequate capital, it could be forced to cease operations. The accompanying condensed financial statements do not include any adjustments to reflect the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management believes that the Company will be able to achieve a satisfactory level of liquidity to meet the Company’s obligations for the next twelve months by generating cash through additional borrowings and/or sale of equity securities, as needed. However, there can be no assurance that the Company will be able to generate sufficient liquidity to maintain its operations. The financial statements do not include any adjustments that might result from the outcome of these uncertainties. 7 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following summary of significant accounting policies of the Company is presented to assist in the understanding of the Company’s financial statements. These accounting policies conform to GAAP in all material respects and have been consistently applied in preparing the accompanying consolidated financial statements. Interim Financial Statements The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with GAAP for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) with respect to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2022 filed with the SEC on April 13, 2023. Principles of Consolidation The consolidated financial statements for June 30, 2023 and 2022, respectively, include the accounts of Company, and its wholly-owned subsidiaries OXYS Corporation and HereLab, Inc. All significant intercompany balances and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the valuation of accounts payable, accrued liabilities and payable to related parties. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. Basic and Diluted Earnings (Loss) Per Common Share The Company computes earnings (loss) per share in accordance with Financial Accounting Standards Board Accounting Standards Codification (“ ASC ”), ASC 260, “ Earnings per Share” . ASC 260 requires presentation of both basic and diluted earnings per share (“ EPS ”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible note and preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. 8 Revenue Recognition The Company’s revenue is derived primarily from providing services under contractual agreements. The Company recognizes revenue in accordance with ASC Topic No. 606, Revenue from Contracts with Customers (“ASC 606”) which was adopted on January 1, 2018. According to ASC 606, the Company recognizes revenue based on the following criteria: · Identification of a contract or contracts, with a customer. · Identification of the performance obligations in the contract. · Determination of contract price. · Allocation of transaction price to the performance obligation. · Recognition of revenue when, or as, performance obligation is satisfied. The Company used a practical expedient available under ASC 606-10-65-1(f)4 that permits it to consider the aggregate effect of all contract modifications that occurred before the beginning of the earliest period presented when identifying satisfied and unsatisfied performance obligations, transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations. The Company has elected to treat shipping and handling activities as cost of sales. Additionally, the Company has elected to record revenue net of sales and other similar taxes. Recent Accounting Pronouncements Accounting standards that have been issued or proposed by FASB and do not require adoption until a future date, are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. NOTE 3 - NOTE RECEIVABLE On April 4, 2022, the Company was issued an unsecured convertible promissory note with the principal sum of $200,000 (“Note”) with a company incorporated under the laws of the Province of British Columbia. The Note bears an original issuance discount of $7,500 and matures on April 4, 2024. The interest on the Note will begin to accrue at the rate of 10% per annum from the date of the Note, and will continue to accrue on the outstanding principal until the entire balance is paid or converted into shares of common stock equal to 3.23% of the fully diluted share capital of the borrower on the conversion date. The terms of the Note require the borrower to prepay (i) within 30 days of April 4, 2022, the first twelve months of interest totaling $20,000, and (ii) within six months of April 4, 2022, the interest for the second twelve months under the Note totaling $20,000. The Company will have the right, at its option on the maturity date, to convert all the principal sum into the common stock equal to 3.23% of the fully diluted share capital of the borrower as of the conversion date. On April 4, 2022, the Company advanced to the borrower $ 192,500 cash and recorded an original issuance discount on note receivable of $ 7,500 . On April 21, 2022, the Company received $ 20,000 as prepaid interest from the borrower for the first twelve months of the Note. The Company recorded interest income earned on the Note of $ 5,921 and $ 11,777 for the three months and six months ended June 30, 2023, and $ 5,661 and $ 5,661 for the three months and six months ended June 30, 2022. The Company recorded unearned interest of $ 0 and $ 5,151 , and unamortized original debt discount of $ 2,856 and $ 4,716 at June 30, 2023 and December 31, 2022, respectively. 9 NOTE 4 - INTANGIBLE ASSETS The Company’s intangible assets comprise of intellectual property revolving around their field tests, sensor integrations, and board designs. Intangible assets, net of amortization amounted to $ 224,038 and $ 248,585 at June 30, 2023 and December 31, 2022, respectively. Schedule of intangible assets June 30, 2023 December 31, 2022 Intangible Assets $ 495,000 $ 495,000 Accumulated amortization ( 270,962 ) ( 246,415 ) Intangible Assets, net $ 224,038 $ 248,585 The Company determined that none of its intangible assets were impaired as of June 30, 2023 and December 31, 2022, respectively, Amortizable intangible assets are amortized using the straight-line method over their estimated useful lives of ten years. Amortization expense of finite-lived intangibles was $ 12,341 and $ 12,341 for the three months ended June 30, 2023 and 2022, respectively. Amortization expense of finite-lived intangibles was $ 24,547 and $ 24,547 for the six months ended June 30, 2023 and 2022, respectively. The following table summarizes the Company’s estimated future amortization expense of intangible assets with finite lives as of June 30, 2023: Schedule of future amortization Amortization Expense 2023 (Remainder of the year) $ 24,953 2024 49,500 2025 49,500 2026 49,500 2027 49,500 Thereafter 1,085 Total $ 224,038 NOTE 5 - COMMITMENTS AND CONTINGENCIES In prior years, the Company entered into consulting agreements with one director, three executive officers, and one engineer of the Company, which include commitments to issue shares of the Company’s common stock from the Company’s 2017 Stock Incentive Plan and 2019 Stock Incentive Plans. All the consulting agreements have been terminated and shares have been issued in conjunction with the related separation agreements. According to the terms of the agreements, 3,547,788 shares were vested and issued per the Company’s 2017 Stock Incentive Plan as of June 30, 2023 and December 31, 2022, and 3,080,000 shares and 2,980,000 shares were vested and issued per the Company’s 2019 Stock Incentive Plan as of June 30, 2023 and December 31, 2022, respectively. In the event that the agreement is terminated by either party pursuant to the terms of the agreement, all unvested shares which have been earned shall vest on a pro-rata basis as of the effective date of the termination of the agreement and all unearned, unvested shares shall be terminated. The value of the shares was assigned at fair market value on the effective date of the agreement and the pro-rata number of shares earned was calculated and amortized at the end of each reporting period. On March 18, 2022, the Company adopted 2022 Stock Incentive Plan and reserved for issuance 20,000,000 shares of common stock for incentivizing its management team. 10 Employment Agreement – CEO/Interim CTO On June 2, 2022, the Board approved an Employment Agreement with the CEO/Interim CTO dated effective April 1, 2022 whereby, the CEO will receive an annual salary of $100,000 which accrues unless converted into shares of common stock of the Company at a stipulated conversion rate. If the Company reaches $1,000,000 in cumulative sales over a 12-month period, the annual salary will increase to $150,000 commencing the following month. If the Company reaches $5,000,000 in cumulative sales over a 12-month period, the annual salary will increase to $200,000 commencing the following month. The Company awarded the CEO an aggregate of 7,000,000 shares of the Company’s common stock under the 2022 Stock Incentive Plan, which will vest (i) 1,500,000 shares on April 1, 2023, (ii) 2,500,000 shares on April 1, 2024, and (iii) 3,000,000 shares on April 1, 2025. The shares are valued at the 90% of the average market price of the shares of 30 trading days at the end of each quarter. As of June 30, 2023, 1,500,000 shares of the common stock were vested and payable to the CEO, and 5,500,000 shares of common stock remain unvested. The Company has recorded $ 142,424 in salaries payable to the CEO as of June 30, 2023 and December 31, 2022, respectively. Employment Agreement – COO/Interim CFO On June 2, 2022, the Board approved an Employment Agreement with the COO/Interim CFO dated effective April 1, 2022, whereby, the officer will receive an annual salary of $100,000 which accrues unless converted into shares of common stock of the Company at a stipulated conversion rate. If the Company reaches $1,000,000 in cumulative sales over a 12-month period, the annual salary will increase to $150,000 commencing the following month. If the Company reaches $5,000,000 in cumulative sales over a 12-month period, the annual salary will increase to $200,000 commencing the following month. The Company awarded the COO/Interim CFO an aggregate of 7,000,000 shares of the Company common stock under the 2022 Stock Incentive Plan, which will vest (i) 1,500,000 shares on April 1, 2023, (ii) 2,500,000 shares on April 1, 2024, and (iii) 3,000,000 shares on April 1, 2025. The shares are valued at the 90% of the average market price of the shares of 30 trading days at the end of each quarter. As of June 30, 2023, 1,500,000 shares of the common stock were vested and payable to the officer, and 5,500,000 shares of common stock remain unvested The Company recorded $ 121,092 in salaries payable to the COO/Interim CFO as of June 30, 2023 and December 31, 2022, respectively. NOTE 6 - CONVERTIBLE NOTES PAYABLE The following table summarizes the outstanding balance of convertible notes payable, interest and conversion rates as of June 30, 2023 and December 31, 2022, respectively. Schedule of convertible notes payable June 30, 2023 December 31, 2022 A. Convertible note payable to an investor with interest at 12% per annum, convertible at any time into shares of common stock at $0.008 per share. The balance of principal and accrued and unpaid interest is payable on maturity on March 1, 2024, unless automatically extended for one-year periods if no Event of Default is existing. The note is secured by substantially all the assets of the Company. $ 205,000 $ 205,000 B. Convertible note payable to an investor with interest at 5% per annum, convertible at any time into shares of common stock at $0.00084 per share. Interest is payable annually with the balance of principal and interest due on maturity on March 1, 2024. The note is secured by substantially all the assets of the Company. 55,000 55,000 D. Convertible note payable to an investor with interest at 12% per annum, convertible at any time into shares of common stock at $0.008 per share. The balance of principal and accrued and unpaid interest is payable on March 1, 2024, unless automatically extended for one-year periods if no Event of Default is existing. The note is secured by substantially all the assets of the Company. 50,000 50,000 E. Convertible notes payable to a related party with interest at 12% per annum, convertible at any time into shares of common stock at $0.00084 per share. Interest is payable quarterly with the balance of principal and interest due on maturity on August 2, 2024. The notes are secured by substantially all the assets of the Company. 125,000 125,000 F. Convertible note payable to an investor with interest at 10% per annum, convertible at any time into shares of common stock at $0.0014 per share. Principal and interest due on maturity on April 29, 2023. – 33,167 G. Convertible note payable to an investor with interest at 10% per annum, convertible at any time into shares of common stock at $0.0014 per share. Note was issued as payment for future fees to be incurred under the related Equity Financing Agreement. Principal and interest due on maturity on April 29, 2025. 75,000 75,000 510,000 543,167 Less: deferred financing costs ( 75,700 ) ( 75,700 ) Less unamortized discount – – Net balance 434,300 467,467 Less current portion ( 310,000 ) ( 363,167 ) Long term portion $ 124,300 $ 104,300 11 A. January 18, 2018 Convertible Note and Warrants (“Note A”) On March 14, 2022, the noteholder of Note A agreed to extend the maturity date of March 1, 2022 of the Senior Secured Convertible Promissory Note to March 1, 2023, in exchange for the reduction of the conversion price to $0.008 per share, and all prior Events of Default (as defined in the Note A) including penalties were waived, and all future Events of Default (as defined in the Note A) pertaining to the future payment of interest were waived through maturity. The Company was in default with the terms of the Note A as of June 30, 2023 and negotiated with the noteholder to extend the maturity date to cure the default on July 21, 2023 (See Note 10 – Subsequent Events). The Company recorded interest expense of $ 6,133 and $ 12,199 for the three months and six months ended June 30, 2023, and $ 7,701 and $ 16,430 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note A was $ 172,067 and $ 159,868 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable on Note A amounted to $ 205,000 on June 30, 2023 and December 31, 2022, respectively. B. January 2019 Convertible Note and Warrants (“Note B”) Effective March 1, 2021, the noteholder of Note B agreed to extend the maturity date of March 1, 2021 of the Secured Convertible Promissory Note to March 1, 2024, and all prior Events of Default (as defined in the Note B) including penalties were waived, and all other terms of the Note B remain the same. The Company recorded interest expense of $ 686 and $ 1,364 on Note B for the three months and six months ended June 30, 2023, and $ 678 and $ 1,364 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note B was $ 12,206 and $ 10,842 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable on Note B amounted to $ 55,000 on June 30, 2023 and December 31, 2022, respectively. D. March 2019 Convertible Note and Warrants (“Note D”) On March 14, 2022, the noteholder of Note D agreed to extend the maturity date of March 1, 2022 of the Senior Secured Convertible Promissory Note to March 1, 2023, in exchange for the reduction of the conversion price to $ 0.008 per share, and all prior Events of Default (as defined in the Note D) including penalties were waived, and all future Events of Default (as defined in the Note D) pertaining to the future payment of interest were waived through maturity. The Company was in default with the terms of the Note D as of June 30, 2023 and negotiated with the noteholder to extend the maturity date to cure the default on July 21, 2023 (See Note 10 – Subsequent Events). The Company recorded interest expense of $ 1,496 and $ 2,975 on Note D for the three months and six months ended June 30, 2023, and $ 1,496 and $ 2,975 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note D was $ 23,673 and $ 20,698 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable on Note D amounted to $ 50,000 on June 30, 2023 and December 31, 2022, respectively. 12 E. August 2019 Convertible Note and Warrants (“Note E”) On August 2, 2021, the noteholder of Note E agreed to extend the maturity date of the Secured Convertible Promissory Note to August 2, 2024. All other terms and conditions of the Note E remain the same. The Company recorded interest expense of $ 3,740 and $ 7,438 on Note E for the three months and six months ended June 30, 2023, and $ 3,740 and $ 7,438 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note E was $ 56,128 and $ 48,690 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable on Note E amounted to $ 125,000 on June 30, 2023 and December 31, 2022, respectively. F. July 2020 Equity Financing Arrangement (“Note F”) On April 29, 2022, the noteholder of Note F agreed to extend the maturity date of the Secured Convertible Promissory Note to April 29, 2023 . All other terms and conditions of the Note F remain the same. On March 23, 2023, the noteholder of Note F converted the principal balance of its convertible promissory note of $ 25,814 and $ 7,186 of accrued interest into 17,837,838 shares of common stock of the Company valued at the fair value of $ 0.00185 per share. On April 27, 2023, the noteholder of Note F converted the remaining principal balance of $ 7,353 and accrued interest of $ 71 into 4,949,507 shares of common stock of the Company valued at the fair value of $ 0.0015 per share. The Company recorded interest expense of $ 71 and $ 828 on Note F for the three months and six months ended June 30, 2023, and $ 827 and $ 1,645 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note F was $ 0 and $ 5,029 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable on Note F amounted to $ 0 and $ 33,167 on June 30, 2023 and December 31, 2022, respectively. G . July 2020 Equity Financing Arrangement (“Note G”) On April 29, 2022, the noteholder of Note G agreed to extend the maturity date of the Secured Convertible Promissory Note to April 29, 2023 . On May 1, 2023, the noteholder of Note G agreed to extend the maturity date of the Secured Convertible Promissory Note to April 29, 2025. All other terms and conditions of the Note G remain the same. The Company recorded interest expense of $ 1,870 and $ 3,719 on Note G for the three months and six months ended June 30, 2023, and $ 1,870 and $ 3,719 for the three months and six months ended June 30, 2022, respectively. Accrued interest payable on Note G was $ 19,559 and $ 17,240 as of June 30, 2023 and December 31, 2022, respectively. The principal balance payable of Note G amounted to $ 75,000 at June 30, 2023 and December 31, 2022, respectively. 13 NOTE 7 - EARNINGS (LOSS) PER SHARE The following table sets forth the computation of basic and diluted net loss per share of common stock for the three months ended June 30, 2023 and 2022: Schedule of earnings per share Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net loss attributable to common stockholders (basic) $ ( 283,058 ) $ ( 200,853 ) $ ( 461,228 ) $ ( 726,012 ) Shares used to compute net loss per common share, basic and diluted 405,346,758 256,513,245 389,868,003 240,541,359 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.00 ) $ ( 0.00 ) $ ( 0.00 ) $ ( 0.00 ) Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company’s potentially dilutive securities which include stock options, convertible debt, convertible preferred stock and common stock warrants have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares outstanding due to the Company’s net loss position. The following outstanding common stock equivalents have been excluded from diluted net loss per common share for the six months ended June 30, 2023 and 2022, respectively, because their inclusion would be anti-dilutive: Schedule of anti dilutive shares As of June 30, 2023 2022 Warrants to purchase common stock 2,868,397 2,868,397 Potentially issuable shares related to convertible notes payable and convertible preferred stock 419,519,773 359,560,236 Total anti-dilutive common stock equivalents 422,388,170 362,428,633 NOTE 8 - RELATED PARTIES At June 30, 2023 and December 31, 2022, respectively, the amount due to two stockholders was $ 1,000 relating to depositing funds for opening bank accounts for the Company. The Company executed an operating lease to rent its current office facility from a stockholder on a month-to-month basis at a monthly rent of $ 250 starting January 1, 2020. The Company recorded rent expense of $ 750 and $ 1,500 for the three months and six months ended June 30, 2023 and 2022, respectively. The Company has recorded $ 1,000 and $ 250 of rent payable to the stockholder in accounts payable as of June 30, 2023 and December 31, 2022, respectively. 14 NOTE 9 - STOCKHOLDERS' EQUITY The Company has an authorized capital of 1,000,000,000 shares, $ 0.001 par value common stock, and 10,000,000 shares of $ 0.001 par value preferred stock at June 30, 2023. The Company has 406,815,293 shares 352,174,583 shares of common stock, and 25,845 shares and 25,845 shares of preferred stock, issued and outstanding as of June 30, 2023 and December 31, 2022, respectively. Common Stock Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the stockholders. Holders of common stock do not have cumulative voting rights. Holders of common stock are entitled to share ratably in dividends, if any, as may be declared from time to time by the Board of Directors in its discretion from funds legally available, therefore. In the event of liquidation, dissolution, or winding up of the Company, the holders of common stock are entitled to share pro rata in all assets remaining after payment in full of all liabilities. All of the outstanding shares of common stock are fully paid and non-assessable. Holders of common stock have no preemptive rights to purchase the Company’s common stock. There are no conversion or redemption rights or sinking fund provisions with respect to the common stock. On February 24, 2021, the Company entered into a Common Stock Purchase Agreement with an investor pursuant to which the investor agreed to purchase up to $5,000,000 of the Company’s registered common stock at $0.015 per share. Pursuant to the Agreement, purchases may be made by the Company during the Commitment Period (as defined in the Agreement) through the submission of a purchase notice to the investor no sooner than ten business days after the preceding closing. No purchase notice can be made in an amount less than $10,000 or greater than $500,000 or greater than two times the average of the daily trading dollar volume for the Company’s common stock during the ten business days preceding the purchase date. Each purchase notice is limited to the investor beneficially owning no more than 4.99% of the total outstanding common stock of the Company at any given time. There are certain conditions precedent to each purchase including, among others, an effective registration statement in place and the VWAP of the closing price of the Company’s common stock greater than $0.0175 for the Company's common stock during the five business days prior to the closing. From January 1, 2023 to March 31, 2023, the investor purchased 31,603,364 shares of common stock for a cash consideration of $ 54,196 . On February 10, 2023, the Company issued 50,000 shares of its common stock to a consultant for services. The common stock was valued at the fair market price of $ 215 on the date of issuance. The shares were issued under the Company’s 2019 Stock Incentive Plan. On February 21, 2023, the Company issued 100,000 shares of its common stock to a consultant for services. The common stock was valued at the fair market price of $ 340 on the date of issuance. The shares were issued under the Company’s 2019 Stock Incentive Plan. On March 13, 2023, the Company issued 100,000 shares of its common stock to a consultant for services. The common stock was valued at the fair market price of $ 270 on the date of issuance. The shares were issued under the Company’s 2019 Stock Incentive Plan. On March 23, 2023, the noteholder of Note F converted the principal balance of $ 25,814 and accrued interest of $ 7,186 into 17,837,838 shares of common stock. The shares issued were valued at the fair value of common stock on the date of issuance. On April 27, 2023, the noteholder of Note F converted the principal balance of $ 7,353 and accrued interest of $ 71 into 4,949,507 shares of common stock. The shares issued were valued at the fair value of common stock on the date of issuance. 15 Stock Incentive Plans On December 14, 2017, the Board of Directors of the Company approved the 2017 Stock Incentive Plan (the “ 2017 Plan ”). Awards may be made under the 2017 Plan for up to 4,500,000 shares of common stock of the Company. All of the Company’s employees, officers and directors, as well as consultants and advisors to the Company are eligible to be granted awards under the 2017 Plan. No awards can be granted under the 2017 Plan after the expiration of 10 years from the plan approval but awards previously granted may extend beyond that date. Awards may consist of both incentive and non-statutory options, restricted stock units, stock appreciation rights, and restricted stock awards. On March 11, 2019, the Board of Directors of the Company approved the 2019 Stock Incentive Plan (the “ 2019 Plan ”). Awards may be made under the 2019 Plan for up to 5,000,000 shares of common stock of the Company. All of the Company’s employees, officers and directors, as well as consultants and advisors to the Company are eligible to be granted awards under the 2019 Plan. No awards can be granted under the 2019 Plan after the expiration of 10 years from the plan approval but awards previously granted may extend beyond that date. Awards may consist of both incentive and non-statutory options, restricted stock units, stock appreciation rights, and restricted stock awards. On March 18, 2022, the Board of Directors approved and adopted the 2022 Stock Incentive Plan (the “ 2022 Plan ”). Awards may be made under the 2022 Plan for up to 20,000,000 shares of common stock of the Company, subject to adjustment as to the number and kind of shares awarded. Only employees and directors of the Company or an Affiliated company are eligible to receive Incentive Options under the 2022 Plan. The Company awarded 7,000,000 shares of the Company’s common stock to an officer and 7,000,000 shares of common stock to a director of the Company (see Note 4) vesting 1,500,000 shares vesting on the first anniversary on the date of issuance, 2,500,000 shares vesting on the second anniversary of the date of issuance, and 3,000,000 shares on the third anniversary of the date of issuance. In addition, on October 3, 2022, the Company awarded 300,000 shares of common stock to an advisor vesting 100,000 shares on the first anniversary date of issuance, 100,000 shares vesting on the second anniversary, and the remaining 100,000 vesting the third anniversary of the date of issuance. The common shares vested pursuant to the 2022 Plan amounted to 3,000,000 shares and 0 shares at June 30, 2023 and December 31, 2022, and the 11,300,000 shares remain unvested as of June 30, 2023. For the three months and six months ended June 30, 2023, the Company recorded $ 1,271 and $ 3,006 as stock compensation expense for the 747,945 shares and 1,488,942 shares payable to an officer and a director that remain unvested as of June 30, 2023. Total shares payable to an officer, consultant and a director totaled 3,756,164 shares and 2,568,493 shares at June 30, 2023 and December 31, 2022, respectively. Shares earned and issued related to the consulting agreements are issued under the 2017 Stock Incentive Plan and the 2019 Stock Incentive Plan (Note 4). Vesting of the shares is subject to acceleration of vesting upon the occurrence of certain events such as a Change of Control (as defined in the agreement) or the listing of the Company’s common stock on a senior exchange. 16 A summary of the status of the Company’s non-vested shares as of June 30, 2023 and 2022, and changes during the three months period then ended, is presented below: Schedule of summary of non-vested shares Non-vested Shares of Common Stock Weighted Average Fair Value 2022 Plan Authorized shares per the 2022 Plan – 20,000,000 shares Balance at December 31, 2022 14,300,000 $ 0.006146 Awarded – – Vested ( 3,000,000 ) – Forfeited – – Balance at June 30, 2023 11,300,000 $ – 2019 Plan Authorized shares per the 2019 Plan – 5,000,000 shares Balance at December 31, 2022 – $ 0.30 Awarded – – Vested – – Forfeited – – Balance at June 30, 2023 – $ 0.30 2017 Plan Authorized shares per the 2017 Plan – 4,500,000 shares Balance at December 31, 2022 – $ 0.30 Awarded – – Vested – – Forfeited – – Balance at June 30, 2023 – $ 0.30 Preferred Stock Series A Supervoting Convertible Preferred Stock On July 2, 2020, the Board of Directors of the Company authorized the issuance of 15,600 shares of preferred stock, $ 0.001 par value per share, designated as Series A Supervoting Convertible Preferred Stock. Dividends: Initially, there will be no dividends due or payable on the Series A Supervoting Preferred Stock. Any future terms with respect to dividends shall be determined by the Board consistent with the Corporation’s Articles of Incorporation. Liquidation and Redemption Rights: Upon the occurrence of a Liquidation Event (as defined below), the holders of Series A Supervoting Preferred Stock are entitled to receive net assets on a pro-rata basis. Each holder of Series A Supervoting Preferred Stock is entitled to receive ratably any dividends declared by the Board, if any, out of funds legally available for the payment of dividends. Liquidation Event means (i) the liquidation, dissolution or winding-up, whether voluntary or involuntary, of the corporation, (ii) the purchase or redemption by the corporation of the shares of any class of stock or the merger or consolidation of the corporation with or into any other corporation or corporations, or (iii) the sale, license or lease of all or substantially all, or any material part of, the Corporation’s assets. 17 Conversion: Each holder of Series A Supervoting Preferred Stock may voluntarily convert its shares into shares of common stock of the Corporation at a rate of 1:100 (as may be adjusted for any combinations or splits with respect to such shares). Rank: All shares of the Series A Supervoting Preferred Stock shall rank senior to the Corporation’s (A) common stock, par value $0.001 per share, and any other class or series of capital stock of the Corporation hereafter created. Voting Rights: A. If at least one share of Series A Super Voting Preferred Stock is issued and outstanding, then the total aggregate issued shares of Series A Super Voting Preferred Stock at any given time, regardless of their number, shall have voting rights equal to 20 times the sum of: i) the total number of shares of Common stock which are issued and outstanding at the time of voting, plus ii) the total number of shares of all Series of Preferred stocks which are issued and outstanding at the time of voting. B. Each individual share of Series A Super Voting Preferred Stock shall have the voting rights equal to: [twenty times the sum of: {all shares of Common stock issued and outstanding at the time of voting + all shares of Series A and any newly designated Preferred stock issued and outstanding at the time of voting}] Divided by: [the number of shares of Series A Super Voting Preferred Stock issued and outstanding at the time of voting] With respect to all matters upon which stockholders are entitled to vote or to which stockholders are entitled to give consent, the holders of the outstanding shares of Series A Super Voting Preferred Stock shall vote together with the holders of Common Stock without regard to class, except as to those matters on which separate class voting is required by applicable law or the Articles of Incorporation or Bylaws. The Company had 25,845 shares of preferred stock issued and outstanding at June 30, 2023 and December 31, 2022, respectively. Series B Convertible Preferred Stock Equity Financing On November 16, 2020, the Board of Directors of the Company authorized the issuance of up to 600 shares of preferred stock, $ 0.001 par value per share, designated as Series B Convertible Preferred Stock. Each share of Preferred Stock has a par value of $0.001 per share and a stated value of $ 1,200 , subject to increase set forth in the Certificate of Designation. Dividends: Each share of Series B Convertible Preferred Stock shall be entitled to receive, and the Corporation shall pay, cumulative dividends of 12% per annum, payable quarterly, beginning on the Original Issuance Date and ending on the date that such share of Series B Convertible Preferred Share has been converted or redeemed (the “Dividend End Date”). Dividends may be paid in cash or in shares of Series B Convertible Preferred Stock. From and after the initial Closing Date, in addition to the payment of dividends pursuant to Section 2(a), each Holder shall be entitled to receive, and the Corporation shall pay, dividends on shares of Series B Convertible Preferred Stock equal to (on an as-if-converted-to-Common-Stock basis) and in the same form as dividends actually paid on shares of the common stock when, as and if such dividends are paid on shares of the common stock. The Corporation shall pay no dividends on shares of the common stock unless it simultaneously complies with the previous sentence. Voting Rights: The Series B Convertible Preferred Stock will vote together with the common stock on an as converted basis subject to the Beneficial Ownership Limitations (not in excess of 4.99% conversion limitation). However, as long as any shares of Series B Convertible Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the Holders of a majority of the then outstanding shares of the Series B Convertible Preferred Stock directly and/or indirectly (a) alter or change adversely the powers, preferences or rights given to the Series B Convertible Preferred Stock or alter or amend this Certificate of Designation, (b) authorize or create any class of stock ranking as to redemption or distribution of assets upon a Liquidation (as defined in Section 5) senior to, or otherwise pari passu with, the Series B Convertible Preferred Stock or, authorize or create any class of stock ranking as to dividends senior to, or otherwise pari passu with, the Series B Convertible Preferred Stock, (c) amend its Articles of Incorporation or other charter documents in any manner that adversely affects any rights of the Holders, (d) increase the number of authorized shares of Series B Convertible Preferred Stock, or (e) enter into any agreement with respect to any of the foregoing. 18 Liquidation: Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary (a “Liquidation”), the Holders shall be entitled to receive out of the assets, whether capital or surplus, of the Corporation an amount equal to the Stated Value, plus any accrued and unpaid dividends thereon and any other fees or liquidated damages then due and owing thereon under this Certificate of Designation, for each share of Series B Convertible Preferred Stock before any distribution or payment shall be made to the holders of any Junior Securities, and if the assets of the Corporation shall be insufficient to pay in full such amounts, then the entire assets to be distributed to the Holders shall be ratably distributed among the Holders in accordance with the respective amounts that would be payable on such shares if all amounts payable thereon were paid in full. Conversion: Each share of Series B Convertible Preferred Stock shall be convertible, at any time and from time to time from and after the Original Issue Date at the option of the Holder thereof, into that number of shares of common stock (subject to the limitations) determined by dividing the Stated Value of such share of Series B Convertible Preferred Stock by the Conversion Price. The Conversion Price for the Series B Convertible Preferred Stock shall be the amount equal to the lowest traded price for the Company’s common stock for the fifteen (15) Trading Days immediately preceding the date of such conversion. All such foregoing determinations will be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the common stock during such measuring period. Following an event of default, the Conversion price shall equal the lower of: (a) the then applicable Conversion Price; or (b) a price per share equaling 80% of the lowest traded price for the Company’s common stock during the ten (10) trading days preceding the relevant Conversion. Redemption: The Series B Convertible Preferred Stock may be redeemed by payment of the stated value thereof, with the following premiums based on the time of the redemption. · 115% of the stated value if the redemption takes place within 90 days of issuance; · 120% of the stated value if the redemption takes place after 90 days and within 120 days of issuance · 125% of the stated value if the redemption takes place after 120 days and within 180 days of issuance; and · each share of Preferred Stock is redeemed one year from the day of issuance November 19, 2020 On November 19, 2020, pursuant to the terms of a Securities Purchase Agreement dated November 16, 2020 (the “SPA”), the Company entered into a new preferred equity financing agreement with GHS Investments, LLC (“GHS”) in the amount of up to $600,000. The SPA provides for GHS’s purchase, from time to time, of up to 600 shares of the newly-designated Series B Convertible Preferred Stock. The initial closing under the SPA consisted of 45 shares of Series B Convertible Preferred Stock, stated value $1,200 per share, issued to GHS for an initial purchase price of $45,000, or $1,000 per share. At the Company’s option, and subject to the terms of the SPA and the Certificate of Designation for the Series B Convertible Preferred Stock (the “COD”), additional closings in the amount of 40 shares of Series B Convertible Preferred Stock for a total purchase price of $40,000 may take place at a rate of up to once every 30 days. In connection with the initial closing in the amount of 45 shares of Series B Convertible Preferred Stock, the Company issued an additional 25 shares of Series B Convertible Preferred Stock to GHS as a commitment fee. No additional closings may take place after the two-year anniversary of the SPA, or once the entire $600,000 amount has been funded. If the average daily dollar trading volume for the Company’s common stock for the 30 trading days preceding a particular additional closing is at least $50,000 per day, the Company may, at its option, increase the amount of that additional closing to 75 shares of Series B Convertible Preferred Stock ($75,000). The Series B Convertible Preferred Stock is classified as temporary equity, as it is convertible upon issuance at an amount equal to the lowest traded price for the Company’s common stock for the fifteen trading days immediately preceding the date of conversion. Based on the requirements of ASC 815, Derivatives and Hedging , the conversion feature represents an embedded derivative that is required to be bifurcated and accounted for as a separate derivative liability. The derivative liability is originally recorded at its estimated fair value and is required to be revalued at each conversion event and reporting period. Changes in the derivative liability fair value are reported in operating results each reporting period. 19 On November 19, 2020, GHS purchased a total of 70 shares of Series B Convertible Preferred Stock for gross proceeds of $ 45,000 . The Company paid $ 900 in selling commissions to complete this financing. On November 19, 2020 (the date of receipt of cash proceeds of $ 45,000 issuance), the Company valued the fair value of the derivative and recorded an initial derivative liability of $ 103,267 , $ 58,267 as day one loss on the derivative, $ 39,000 as interest expense, and $ 39,000 as Series B Convertible Preferred Stock mezzanine liability, and $ 45,000 as amortization. The Company recalculated the value of the derivative liability associated with this convertible preferred stock recording a loss of $ 23,960 and $ 24,159 for the three months and six months ended June 30, 2023, and a loss of $ 14,922 and gain of $ 3,147 for the three months and six months ended June 30, 2022, respectively, in connection with the change in fair market value of the derivative liability. The Company recorded $ 2,513 and $ 4,999 as preferred stock dividend expense for the three months and six months ended June 30, 2023, and $ 2,513 and $ 4,999 as preferred stock dividend for the three months and six months ended June 30, 2022. The Company recorded $ 26,319 and $ 21,320 as preferred stock dividend payable as of June 30, 2023 and December 31, 2022, respectively. Derivative liability payable for this transaction totaled $ 96,615 and $ 72,456 at June 30, 2023 and December 31, 2022, and Series B Convertible Preferred Stock mezzanine liability was $ 84,000 at June 30, 2023 and December 31, 2022, respectively. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0141, the closing stock price of the Company's common stock on the date of valuation ranging from $0.0015 to $0.0184, an expected dividend yield of 0%, expected volatility ranging from 160.41% to 440.99%, risk-free interest rates ranging from 0.38% to 5.40%, and an expected term ranging from 0.13 years to 1.50 years. December 16, 2020 On December 16, 2020, pursuant to the terms of the SPA, GHS purchased an additional 85 shares of Series B Convertible Preferred Stock for gross proceeds of $ 85,000 . The Company paid $ 1,700 in selling commissions to complete this financing. On December 16, 2020 (the date of receipt of cash proceeds of $ 85,000 issuance), the Company valued the fair value of the derivative and recorded an initial derivative liability of $ 106,241 , $ 21,241 as day one loss on the derivative, $ 17,000 as interest expense, and $ 17,000 as Series B Convertible Preferred Stock mezzanine liability, and $ 85,000 as amortization. The Company recalculated the value of the derivative liability associated with this convertible preferred stock recording a loss of $ 29,094 and $ 29,336 for the three months and six months ended June 30, 2023, and a loss of $ 11,897 and gain of $ 19,311 for the three months and six months ended June 30, 2022, in connection with the change in fair market value of the derivative liability. The Company recorded preferred stock dividend expense of $ 3,052 and $ 6,070 for the three months and six months ended June 30, 2023, and $ 3,052 and $ 6,070 for the three months and six months ended June 30, 2022. The Company recorded $ 31,053 and $ 24,983 as preferred stock dividend payable as of June 30, 2023 and December 31, 2022, respectively. Derivative liability payable for this transaction totaled $ 117,319 and 87,982 at June 30, 2023 and December 31, 2022, and Series B Convertible Preferred Stock mezzanine liability was $ 102,000 at June 30, 2023 and December 31, 2022, respectively. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0141, the closing stock price of the Company's common stock on the date of valuation ranging from $0.0015 to $0.0184, an expected dividend yield of 0%, expected volatility ranging from 160.41% to 437.59%, risk-free interest rates ranging from 0.38% to 5.40%, and an expected term ranging from 0.21 years to 1.50 years. 20 December 20, 2021 On December 20, 2021, pursuant to the terms of the SPA, GHS purchased an additional 51 shares of Series B Convertible Preferred Stock for gross proceeds of $ 51,000 . The Company paid $ 1,000 in selling commissions to complete this financing. The Company recalculated the value of the derivative liability associated with this convertible preferred stock recording a loss of $ 17,457 and $ 17,602 for the three months and six months ended June 30, 2023, in connection with the change in fair market value of the derivative liability. The Company recorded preferred stock dividend expense of $ 1,831 and $ 3,642 for the three months and six months ended June 30, 2023. The Company recorded preferred stock dividend payable of $ 11,207 and $ 7,565 as of June 30, 2023 and December 31, 2022, respectively. Derivative liability payable for this transaction totaled $ 70,391 and $ 52,789 at June 30, 2023 and December 31, 2022 and Series B Convertible Preferred Stock mezzanine liability was $ 102,000 at June 30, 2023 and December 31, 2022, respectively. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0050 the closing stock price of the Company's common stock on the date of valuation ranging from $0.0015 to $0.0070, an expected dividend yield of 0%, expected volatility ranging from 174.58% to 221.64%, risk-free interest rates ranging from 0.39% to 5.40%, and an expected term of 1.50 years. February 7, 2022 On February 7, 2022, pursuant to the terms of the SPA, GHS purchased an additional 51 shares of Series B Convertible Preferred Stock for gross proceeds of $ 51,000 . The Company paid $ 1,000 in selling commissions to complete this financing. On February 7, 2022 (the date of receipt of cash proceeds of $51,000 issuance), the Company valued the fair value of the derivative and recorded an initial derivative liability of $ 65,025 , $ 14,025 as day one loss on the derivative, $ 10,200 as interest expense, and $ 10,200 as Series B Convertible Preferred Stock mezzanine liability, and $ 51,000 as amortization. The Company recalculated the value of the derivative liability associated with this convertible preferred stock recording a loss of $ 17,457 and $ 17,602 for the three months and six months ended June 30, 2023, and a gain of $ 15,870 and a loss of $ 1,058 for the three months and six months ended June 30, 2022, in connection with the change in fair market value of the derivative liability. The Company recorded preferred stock dividend expense of $ 1,831 and $ 3,642 for the three months and six months ended June 30, 2023, and preferred stock dividend expense of $ 1,831 and $ 2,877 for the three months and six months ended June 30, 2022. The Company recorded preferred stock dividend payable of $ 10,221 and $ 6,579 as of June 30, 2023 and December 31, 2022, respectively. Derivative liability payable for this transaction totaled $ 70,391 and $ 52,789 at June 30, 2023 and December 31, 2022 and Series B Convertible Preferred Stock mezzanine liability was $ 61,200 at June 30, 2023 and December 31, 2022, respectively. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0096, the closing stock price of the Company’s common stock on the date of valuation ranging from $0.0015 to $0.0172, an expected dividend yield of 0%, expected volatility ranging from 160.35% to 189.90%, risk-free interest rates ranging from 1.09% to 5.40%, and an expected term of 1.35 to 1.5 years. 21 March 24, 2022 On March 24, 2022, pursuant to the terms of the SPA, GHS purchased an additional 136 shares of Series B Convertible Preferred Stock for gross proceeds of $ 136,000 . The Company paid $ 2,720 in selling commissions to complete this financing. On March 24, 2022 (the date of receipt of cash proceeds of $136,000 issuance), the Company valued the fair value of the derivative and recorded an initial derivative liability of $ 328,422 , $ 192,422 as day one loss on the derivative, $ 27,200 as interest expense, and $ 27,200 as Series B Convertible Preferred Stock mezzanine liability, and $ 136,000 as amortization. The Company recalculated the value of the derivative liability associated with the convertible note at June 30, 2023 and 2022, and recorded a loss of $ 46,551 and $ 46,938 for the three months and six months ended June 30, 2023 and 2022, and a gain of $ 47,006 and $ 152,201 for the three months and six months ended June 30, 2022, in connection with the change in fair market value of the derivative liability. In addition, the Company recorded preferred stock dividend expense of $ 4,883 and $ 9,712 for the three months and six months ended June 30, 2023, and $ 4,883 and $ 5,259 for the three months and six months ended June 30, 2022. Preferred stock dividend payable to GHS for this derivative totaled $ 24,843 and $ 15,131 at June 30, 2023 and December 31, 2022. Derivative liability payable for this transaction totaled $ 187,710 and $ 140,772 at June 30, 2023 and December 31, 2022, respectively, and Series B Convertible Preferred Stock mezzanine liability was $ 163,200 at June 30, 2023 and December 31, 2022. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0096, the closing stock price of the Company’s common stock on the date of valuation ranging from $0.0015 to $0.0183, an expected dividend yield of 0%, expected volatility ranging from 160.35% to 189.90%, risk-free interest rates ranging from 1.55% to 5.40%, and an expected term of 1.48 to 1.5 years. November 17, 2022 On November 17, 2022, pursuant to the terms of the SPA, GHS purchased an additional 61 shares of Series B Convertible Preferred Stock for gross proceeds of $ 61,000 . The Company paid $ 1,220 in selling commissions to complete this financing. On November 17, 2022 (the date of receipt of cash proceeds of $61,000 issuance), the Company valued the fair value of the derivative and recorded an initial derivative liability of $ 54,072 , $ 6,928 as day one gain on the derivative, $ 12,200 as interest expense, and $ 12,200 as Series B Convertible Preferred Stock mezzanine liability, and $ 61,000 as amortization. The Company recalculated the value of the derivative liability associated with the convertible note at June 30, 2023 and recorded a loss of $ 20,879 and $ 21,053 for the three months and six months ended June 30, 2023, in connection with the change in fair market value of the derivative liability. In addition, the Company recorded preferred stock dividend expense of $ 2,190 and $ 4,356 for the three months and six months ended June 30, 2023. Preferred stock dividend payable to GHS for this derivative totaled $ 5,415 and $ 1,059 at June 30, 2023 and December 31, 2022. Derivative liability payable for this transaction totaled $ 84,193 and $ 63,140 at June 30, 2023 and December 31, 2022, respectively, and Series B Convertible Preferred Stock mezzanine liability was $ 73,200 at June 30, 2023 and December 31, 2022. The Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion exercise prices ranging from $0.0013 to $0.0020, the closing stock price of the Company’s common stock on the date of valuation ranging from $0.0015 to $0.0022, an expected dividend yield of 0 %, expected volatility ranging from 174.58 % to 189.90 %, risk-free interest rates ranging from 4.64 % to 5.40 %, and an expected term of 1.5 years. As a result of issuance of derivative instruments, the Company recorded a derivative liability of $ 626,563 and $ 469,873 as of June 30, 2023 and December 31, 2022, and Series B Convertible Preferred Stock liability of $ 544,800 as of June 30, 2023 and December 31, 2022, respectively. 22 Warrants A summary of the status of the Company’s warrants as of June 30, 2023 and 2022, and changes during the six months then ended, is presented below: Schedule of summary of warrant activity Shares Under Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding at December 31, 2021 – – Issued 2,868,397 $ 0.00084 2.4 Years Exercised – – Expired/Forfeited – – Outstanding at June 30, 2022 2,868,397 $ 0.00084 2.0 Years Outstanding at December 31, 2022 – – Issued 2,868,397 $ 0.00084 1.4 Years Exercised – – Expired/Forfeited – – Outstanding at June 30, 2023 2,868,397 $ 0.00084 1.0 Years NOTE 10 – SUBSEQUENT EVENT Management has evaluated subsequent events through the date of this Report, the date the financial statements were available to be issued, noting the following items that would impact the accounting for events or transactions in the current period or require additional disclosure. On July 21, 2023, the Company and noteholders A and D agreed to amend the maturity date of the convertible promissory notes to March 1, 2024, subject to certain conditions with respect to voluntary conversions, conversion prices, incentive shares to be issued to the noteholders upon request from the noteholders (1 st incentive shares worth $20,000), and upon full conversion of the notes, the noteholder shall receive 2 nd incentive shares worth $50,000. The conversion price for the incentive shares shall be the volume weighted average price (VWAP) per common share for the previous ten (10) trading days (See Note 6 – Convertible Promissory Notes). 23