STOCKHOLDERS DEFICIT |
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STOCKHOLDERS' DEFICIT | NOTE 8 – STOCKHOLDERS’ DEFICIT
Authorized Shares
As of April 30, 2024 and 2023, the Company had authorized 25,001,000,000 and 10,001,000,000 shares of capital stock, consisting of 25,000,000,000 and 10,000,000,000 shares of common stock and 1,000,000 and 1,000,000 shares of preferred stock, respectively.
Common Stock Issuances
During the year ended April 30, 2024, the Company issued a total of 8,673,183 shares of its common stock: 1,674,153,605 shares converted from Series B preferred stock; 3,545,720,685 shares valued at $249,732 in conversion of convertible notes principal of $231,970, accrued interest payable of $16,142, gain on settlement of $1,148 and conversion fees of $1,620; 279,120,377 shares for accrued liabilities of $17,808 which were valued at $83,736 based on the closing market price of the Company’s stock on the day of conversions and therefore a loss of $65,928 was recognized; and 3,174,187,995 shares for accrued liabilities – related parties of $204,763 which were valued at $892,133 based on the closing market price of the Company’s stock on the day of conversion and therefore a loss of $687,370 was recognized (see Note 4).
During the year ended April 30, 2023, the Company issued a total of 748,413,613 shares of its common stock: 202,640,220 shares valued at $338,700 in conversion of convertible notes principal of $373,367 accrued interest payable of $34,667 and payment of fees of $2,700; 1,373,562 shares and 686,281 warrants (see Warrants below) for cash of $41,209, which was offset by $12,000 in offering costs; 91,414 shares issued for accrued expenses – related parties of $1,006 (see Note 4); 100,000 shares and 235,109,718 warrants (see Warrants below) issued for a debt discount valued at $17,371; 16,188,264 shares issued for the exercise of warrants; and 528,020,153 issued for the conversion of 356 shares of Series B preferred stock.
Series A Preferred Stock
The Series A preferred stock has no redemption, conversion or dividend rights; however, the holders of the Series A preferred stock, voting separately as a class, has the right to vote on all shareholder matters equal to 51% of the total vote.
During the year ended April 30, 2024 and 2023 no preferred shares were issued.
Series B Preferred Stock
The Series B preferred stock has a stated value equal to $1,000, has no redemption or voting rights, and are entitled to receive dividends on preferred stock equal, on an as-of-converted-to-common-stock basis, to and in the same form as the dividends paid on shares of the common stock. The Series B preferred stock was convertible, at the option of the holder, into the number of shares of common stock determined by dividing the stated value of such share of Preferred Stock by the initial Conversion Price of $0.10, which was adjusted to $0.05 per share effective June 7, 2022 and to $0.000058 effective May 5, 2023.
During the year ended April 30, 2024 the Company did not issue any shares of its Series B preferred stock, however, the Company issued 1,674,153,605 shares of its common stock upon the conversion of 115 shares of the Series B preferred stock by the holder. During the year ended April 30, 2023 the Company did not issue any shares of its Series B preferred stock, however, as a result of the change in the Conversion Price that occurred on June 7, 2022, the Company recognized a deemed dividend of $2,534,402 to account for the change in fair value of the Series B preferred stock. Further, during the year ended April 30, 2023, the Company issued 528,020,153 shares of its common stock upon the conversion of 356 shares of the Series B preferred stock by the holder.
Warrants
A summary of warrant activity during the years ended April 30, 2024 and 2023 is presented below:
During the year ended April 30, 2024 the Company terminated 3,000,000 warrants each to three entities affiliated with the Company’s two board members and shareholder (consultant) of more than ten percent (see Note 4). The Company accounted for this modification as a cancellation of the previous award and issuance of a new award in its place (50,000,000 warrants each or 150,000,000 total), and recorded $28,200 worth of stock-based compensation to capture the difference in fair market value. During the year ended April 30, 2023, the Company issued 3,209,208,693 in conjunction with the issuance of debt (see Note 4 & Note 7). Of the note proceeds, $152,672 was allocated to the warrants based on relative fair values. The 3,209,208,693 warrants have an exercise price of $0.000058 and have a five-year life.
During the year ended April 30, 2023 the Company granted 3,000,000 warrants each to two entities affiliated with the Company’s two board members and one related party consultant (see Note 4). The fair value of the warrants was $495,000 and recognized in additional paid-in capital. Additionally, effective June 7, 2022 the Company entered into an agreement to reduce the exercise price of its Series C and Series D warrants, from $0.10 to $0.05. The Company accounted for this modification as a cancellation of the previous award and issuance of a new award in its place, however, as there was no change in the fair value as a result of the modification, no additional expense was recorded on the Company’s books. During the year ended April 30, 2023 the Company issued 686,281 warrants in conjunction with the sale of common stock (see Common Stock above). As the fair value of the warrants granted would have had a net zero impact to equity (increasing additional paid-in capital and recording offering costs for the same amount), the Company did not break out or complete a separate valuation of the warrants granted in association with the capital raised. The 686,281 warrants have an exercise price of $0.045 and have a one-year life. Lastly, during the year ended April 30, 2023, the Company issued 235,109,718 in conjunction with the issuance of a promissory note (see Note 7). Of the $15,000 note proceeds, $11,991 was allocated to the warrants based on relative fair values. The 235,109,718 warrants have an exercise price of $0.0000638 and have a five-year life. Common Stock Reserved
Combined with the 9,442,800,957 common shares outstanding at April 30, 2024, all authorized common shares have been issued or reserved for issuance of outstanding warrants, stock options, and convertible notes payable and no common shares are available for share issuances other than those shares included in the reserves. |