In July 2022, the Company’s authorized common stock was increased from 700,000,000 to 2,000,000,000 shares, with an effective date of the Amendment to the Articles of Incorporation of August 5, 2022. There was no change in the shares outstanding of either the common stock or preferred stock as a result of the increase.
During the six months ended June 30, 2023, the Company had the following transactions related to its convertible note financings:
• 1800 Diagonal Lending LLC converted, in three tranches, the outstanding principal balance of $23,600 together with accrued and unpaid interest thereon of $2,787 due on their note of May 5, 2022 into 75,643,939 shares of the Company’s common stock at conversion prices of $0.00033 to $0.00036 per share under the conversion provision and terms of the note agreement. • 1800 Diagonal Lending LLC converted the total outstanding principal balance of $43,750 together with accrued and unpaid interest thereon of $2,788 due on their note of August 30, 2022 into 305,250,000 shares of the Company’s common stock at conversion prices of $0.00013 to $0.00026 per share under the conversion provision and terms of the note agreement. ? 1800 Diagonal Lending LLC made a $6,070 partial conversion of the principal portion of their October 31, 2022 note into 46,692,308 shares of the Company’s common stock at a conversion price of $0.00013 per share under the conversion provision and terms of the note agreement. • GS Capital Partners made a $5,933 partial conversion, in two tranches, of the principal portion of their October 11, 2021 note together with accrued and unpaid interest of $1,267 into 59,998,666 shares of the Company’s common stock at a conversion price of $0.00012 per share under the conversion provision and terms of the note agreement.
At June 30, 2023, we had a working capital deficit of $1,176,489 and cash of $19,942 as compared to a working capital deficit of $971,295 and cash of $62,085, at December 31, 2022. The decrease in cash and increase in working capital deficit was due primarily to the utilization of available cash for operations and an increase in debt funding from $125,000 of loans received in the six months ended June 30, 2023. The Company used new and existing fundings to maintain operating activities and complete filings of amendments to the Company’s Registration Statement on Form S-1. During the six months ended June 30, 2023, we used $151,142 of cash for operating activities and paid $16,001 in investing activities for software development and patent costs. In the comparable 2022 period, operating activities utilized cash of $329,832 and investing activities for software development and patent costs utilized cash of $9,634.
Substantially all of our funding in 2023 and 2022 has been from notes and convertible debt financings from non-related investment firms and individuals. During the six months ended June 30, 2023, we borrowed $125,000 from four individuals, due nine months from issuance with interest at 11%. During the six months ended June 30, 2022, we issued convertible debt with a face value of $111,500, receiving cash proceeds, net of financing costs, of $104,000. The convertible debt instruments were with non-related investment firms, carried an interest rate of 10%, matured six months to one year from date of financing and were convertible into shares of the Company’s common stock at a discount to the trading prices of the common shares of 35% to 40%. During the six months ended June 30, 2023, note holders were issued 487,584,913 shares of common stock for conversion of $85,595 face value of debt and related accrued interest. In the comparable 2022 period, convertible note holders were issued 143,872,288 shares of common stock for conversion of $461,584 face value of debt and related accrued interest and fees.
I swear I’ll never use the phrase “you can’t make this stuff up” ever again after being on the OTC. Apparently you can.
