Note 5 – NOTES PAYABLE

Related Party Convertible Loan

An officer of the Company has provided a loan to TSR under a convertible promissory note. This convertible promissory note is unsecured, non-interest bearing, and is convertible into common shares of the Company stock at $2.75 per share and due on demand. The balance due to the officer was $60,890 and $53,890 as of January 31, 2023 and April 30, 2022, respectively.

Short Term Loans

As of January 31, 2023 and April 30, 2022, the Company had two loans totaling $2,700 and $16,763, respectively. One of the loans, totaling $14,063, was converted for 597,190 shares of common stock during the period ended January 31, 2023. The remaining loan of $2,700 is unsecured, non-interest bearing and due on demand. 

Convertible Notes Payable

The following table reflects the convertible notes payable as of January 31, 2023 and April 30, 2022:

Schedule of Notes Payable 

The convertible notes payable are convertible into a fixed number of shares and with no down round protection features. The Company accounted for the beneficial conversion features based on the intrinsic value at the date of issuance. During the nine months ended January 31, 2023 and year ended April 30, 2022, the Company recognized beneficial conversion features totaling $0 and $479,579, respectively. The discount from the beneficial conversion features are being amortized through charges to interest expense over the term of the convertible notes payable. The Company recorded interest expense related to the amortization of debt discounts on these notes of $0 and $206,818 for the three months ended January 31, 2023 and 2022, respectively. The Company recorded interest expense related to the amortization of debt discounts on these notes of $21,114 and $525,448 for the nine months ended January 31, 2023 and 2022, respectively.

New Convertible Notes Payable Issued During the Nine Month Periods Ended January 31, 2023 and 2022

2023

The Company did not enter into any new convertible note payable agreements during the nine month period ended January 31, 2023.

2022

On May 5, 2021, the Company entered into a convertible note payable with a corporation. The note payable, with a face value of $150,000, including a $15,000 original issue discount, bears interest at 10.0% per annum and is due on May 5, 2023. The convertible note payable is convertible, at the holder’s option, into the Company’s common shares at a fixed conversation rate of $0.10. The conversion of the note into shares of the Company’s common stock is potentially highly dilutive to current shareholders. If the note holder elects to sell the shares that it has acquired as a result of converting the note into shares of common stock, then any such sales may result in a significant decrease in the market price of the Company’s shares.

On May 7, 2021, the Company entered into a convertible note payable with a corporation. The note payable, with a face value of $100,000, including a $10,000 original issue discount, bears interest at 10.0% per annum and is due on May 7, 2023. The convertible note payable is convertible, at the holder’s option, into the Company’s common shares at a fixed conversation rate of $0.10. The conversion of the note into shares of the Company’s common stock is potentially highly dilutive to current shareholders. If the note holder elects to sell the shares that it has acquired as a result of converting the note into shares of common stock, then any such sales may result in a significant decrease in the market price of the Company’s shares.

On May 19, 2021, the Company entered into a convertible note payable with a corporation. The note payable, with a face value of $150,000, including a $15,000 original issue discount, bears interest at 10.0% per annum and is due on May 19, 2023. The convertible note payable is convertible, at the holder’s option, into the Company’s common shares at a fixed conversation rate of $0.10. The conversion of the note into shares of the Company’s common stock is potentially highly dilutive to current shareholders. If the note holder elects to sell the shares that it has acquired as a result of converting the note into shares of common stock, then any such sales may result in a significant decrease in the market price of the Company’s shares.

On December 6, 2021, the Company entered into a convertible note payable with a corporation. The note payable, with a face value of $70,666, including a $17,666 original issue discount, bears interest at 0.0% per annum and is due on March 6, 2023. The default interest rate is 15% if the note is not repaid within ninety days of the issue date, retroactive to the date of issuance. There was also $3,000 for legal fees included in the note balance. After the occurrence of any event of default, the convertible note payable is convertible, at the holder’s option, into the Company’s common shares at a fixed conversation rate of $0.10. The lender also received 282,667 warrants to purchase the Company’s common stock at a purchase price of $0.25 for a period of five years from the date of the note. During the twelve months immediately following the Closing, with respect to each and any securities offering conducted by the Company, the Company agrees to, and hereby does, irrevocably grant to the Buyer the option to purchase up to $1,000,000 worth of the securities offered in such offering at the applicable offering prices thereunder. The conversion of the note into shares of the Company’s common stock is potentially highly dilutive to current shareholders. If the note holder elects to sell the shares that it has acquired as a result of converting the note into shares of common stock, then any such sales may result in a significant decrease in the market price of the Company’s shares.

On April 20, 2022, the Company entered into a convertible note payable with an individual who is a member of the Company’s Board of Directors.  The note payable, with a face value of $50,000, bears interest at 10.0% per annum and is due on July 21, 2023. The convertible note payable is convertible upon default, at the note holder’s option, into the Company’s common shares at a fixed conversation rate of $0.05. The conversion of the note into shares of the Company’s common stock is potentially highly dilutive to current shareholders. If the note holder elects to sell the shares that it has acquired as a result of converting the note into shares of common stock, then any such sales may result in a significant decrease in the market price of the Company’s shares.  This convertible promissory note is currently in default due to non payment of principal and interest.