Long-term debt and convertible promissory notes

6 Months Ended

Jul. 31, 2022

Debt Disclosure [Abstract]

Long-term debt and convertible promissory notes

NOTE 8 – Long-term debt and convertible promissory notes

Following is a summary of convertible promissory notes:

	July 31, 2022			January 31, 2022
8% convertible note payable issued October 2021, due October 2022	$	–		$	69,300
8% convertible note payable issued November 2021, due November 2022		-			69,000
8% convertible note payable issued December 2021, due December 2022		20,000			63,000
8% convertible note payable issued February 2022, due February 2023		74,800			-
8% convertible note payable issued April 2022, due April 2023		71,500			-
8% convertible note payable issued July 2022, due July 2023		45,138			-
		211,438			201,300
Less debt discount		(33,526	)		(20,178	)
Less current portion of convertible notes		(177,912	)		(181,122	)
Long-term convertible notes payable	$	-		$	-

On February 7, 2022, the Company entered into a convertible promissory note with 1800 Diagonal Lending (formerly known as Sixth Street Lending LLC) in the aggregate principal amount of $74,800 (the “February 2022 Note”). The note bears interest at 8%, with an Original Issue Discount of $9,800, matures on February 7, 2023, and is convertible after 180 days into shares of the Company’s common stock at a price of 75% of the average of the lowest 5 weighted average market price of the Company’s common stock during the 10 trading days prior to conversion.

On April 25, 2022, the Company entered into a convertible promissory note with 1800 Diagonal Lending (formerly known as Sixth Street Lending LLC) in the aggregate principal amount of $71,500 (the “April 2022 Note”). The note bears interest at 8%, with an Original Issue Discount of $8,000, matures on April 25,2023, and is convertible after 180 days into shares of the Company’s common stock at a price of 75% of the average of the lowest 5 weighted average market price of the Company’s common stock during the 10 trading days prior to conversion.

On July 14, 2022, the Company entered into a convertible promissory note with 1800 Diagonal Lending LLC in the aggregate principal amount of $45,138 (the “July 2022 Note”). The note bears interest at 8%, with an Original Issue Discount of $10,138, matures on July 14, 2023, and is convertible after 180 days into shares of the Company’s common stock at a price of 75% of the average of the lowest 5 weighted average market price of the Company’s common stock during the 10 trading days prior to conversion.

During the six months ended July 31, 2022 and 2021, the Company recorded debt discounts of $66,328 and $64,823, respectively, due to the derivative liabilities, and original issue debt discounts of $29,438 and $6,000, respectively, due to the convertible notes. The Company recorded amortization of these discounts of $61,602 and $73,551 for the six months ended July 31, 2022 and 2021, respectively.

Notes Payable

On June 22, 2020, the Company received loan proceeds of $32,300 (net of $100 loan fee) under the SBA’s Economic Injury Disaster Loan program (“EIDL”). The EIDL loan, dated June 16, 2020, bears interest at 3.75%, has a 30-year term, is secured by substantially all assets of the Company, and is due in monthly installments of $158 beginning June 18, 2021 (extended to June 18, 2023).

On February 16, 2021, the Company received loan proceeds of $32,497 under the Payroll Protection Program (“PPP”). The PPP loan bears interest at 1%, has a 5-year term, and is due in equal monthly installments beginning July 19, 2022. In March 2022, the Company’s SBA PPP loan was forgiven in full resulting in a gain on forgiveness of debt of $32,497 of principal and $354 of interest.

In April 2022, the Company entered into a Premium Finance Agreement related to an insurance policy. The policy premiums total $33,400 for a one year policy period. The Company financed $24,750 of the policy over a nine month period. The monthly payments under the agreement are due in nine installments of $2,871, at an annual interest rate of 10.45%.

As of July 31, 2022, the notes payable, net balance was $13,958, which was recorded as current portion, with accrued interest of $0. As of January 31, 2022, the notes payable, net balance was $64,897, which include term long notes payable of $64,897 and current portion of notes payable of $0, with accrued interest of $2,287.