v3.26.1
CONVERTIBLE NOTES PAYABLE AND NOTES PAYABLE
 9 Months Ended
Mar. 31, 2026
CONVERTIBLE NOTES PAYABLE AND NOTES PAYABLE  
CONVERTIBLE NOTES PAYABLE AND NOTES PAYABLE

NOTE 5: CONVERTIBLE NOTES PAYABLE AND NOTES PAYABLE

 

Convertible Notes Payable

 

At March 31, 2026 and June 30, 2025 convertible debentures consisted of the following:

 

 

 

March 31,

 

 

June 30,

 

 

 

2026

 

 

2025

 

Convertible notes payable

 

$335,018

 

 

$183,873

 

Discount on convertible notes

 

 

(143,819

) 

 

 

-

 

Convertible notes, net

 

$191,199

 

 

$183,873

 

 

The Company had convertible promissory notes net of discount aggregating approximately $191,199 and $183,873 at March 31, 2026 and June 30, 2025, respectively. The related accrued interest amounted to approximately $226,376 and $247,563 at March 31, 2026 and June 30, 2025, respectively. The convertible notes payable bear interest at rates ranging from 0% to 24% per annum. The convertible notes are generally convertible, at the holders’ option, at rates ranging from $0.00097 to $121.50 per share, as a result of the two reverse stock splits. At March 31, 2026, approximately $268,418 of convertible promissory notes had matured, are in default and remain unpaid. Certain notes contain punitive default provisions that may significantly increase the amount due upon the occurrence of certain events of default. If the Company fails to pay principal or interest at maturity, the outstanding principal, accrued interest, and any unpaid amounts (the “Default Amount”) may become immediately due and payable. For certain other events of default—such as failure to deliver conversion shares, breaches of covenants, representations, bankruptcy, or failure to maintain reporting requirements—the note holder is entitled to additional penalties. Specifically, (i) in the case of a failure to deliver conversion shares, the holder may require payment of two times the Default Amount, (ii) for other specified default events, the note accelerates and becomes immediately due at one and one-half times (1.5x) the Default Amount, and (iii) in addition, the note provides for a liquidated damages fee of $2,000 per day for delays in the issuance of conversion shares, which may be added to principal and accrue interest. Upon default, the Company is also liable for all legal and collection costs incurred by the note holder. These provisions may result in substantial financial penalties and adversely impact the Company’s liquidity and capital resources in the event of default.

The changes in the convertible notes payable balance are summarized below:

 

Convertible payable at June 30, 2025

 

$183,873

 

Convertible notes issued during the nine months ended March 31, 2026

 

 

-

 

Promissory notes reclassified as Convertible notes upon default

 

 

188,793

 

Increase in discount on convertible notes payable

 

 

 (143,819

) 

Conversion of convertible notes payable into common stock

 

 

(37,748 )

Convertible payable at March 31, 2026

 

$191,199

 

 

For the nine months ended March 31, 2026, the following summarizes the conversion of debt for common shares:

 

 

 

 

 

 

Amount of

 

 

 Amount of

 

 

 

 

 

 

 

 

Conversion

 

 

 

Shares

 

 

Converted

 

 

 Converted

 

 

Conversion

 

 

 

 

 

Price

 

Name

 

Issued

 

 

Principal

 

 

Interest

 

 

Expense

 

 

Total

 

 

Per Share

 

FirstFire

 

 

32,000,000

 

 

$4,741

 

 

$129,659

 

 

$-

 

 

$134,400

 

 

$0.0042

 

Labrys II

 

 

10,000,000

 

 

 

16,940

 

 

 

1,310

 

 

 

1,750

 

 

 

20,000

 

 

 

0.002

 

1800 Diagonal

 

 

16,834,782

 

 

 

16,067

 

 

 

8,667

 

 

 

1,750

 

 

 

26,484

 

 

 

0.00147

 

Total

 

 

58,834,782

 

 

$37,748

 

 

$139,636

 

 

$3,500

 

 

$180,884

 

 

$0.003

 

 

In the nine months ended March 31, 2026 the noteholders converted the principal and interest related to these notes at an average conversion rate of $0.003 per share.

 

Notes Payable

 

The Company had promissory notes aggregating $1,118,200 and $991,567 at March 31, 2026 and June 30, 2025, respectively. The related accrued interest amounted to approximately $266,030 and $170,481 at March 31, 2026 and June 30, 2025, respectively. The notes payable bear interest at rates ranging from 0% to 18% per annum and are payable monthly. Promissory notes totaling $835,000 have matured as of March 31, 2026, and are in default.