Convertible Note Payable
|3 Months Ended|
Mar. 31, 2022
|Debt Disclosure [Abstract]|
|Convertible Note Payable||
Note 10 – Convertible Note Payable
Convertible note payable consists of the following at March 31, 2022 and December 31, 2021, respectively:
Schedule of Convertible Note Payable
ONE WORLD PRODUCTS, INC.
Notes to Condensed Consolidated Financial Statements
The Company recognized aggregate debt discounts on the convertible notes and notes payable to AJB Capital for the three months ended March 31, 2022 and the year ended December 31, 2021, as follows:
Schedule of Convertible Debt Discounts
The aggregate debt discounts of $869,329, for the year ended December 31, 2021, are being amortized over the life of the loan using the straight-line method, which approximates the effective interest method. The Company recorded finance expense in the amount of $142,849 and $79,921 on the amortization of these discounts for the three months ended March 31, 2022 and 2021, respectively.
The convertible note limits the maximum number of shares that can be owned by the note holder as a result of the conversions to common stock to 4.99% of the Company’s issued and outstanding shares.
The Company recorded interest expense pursuant to the stated interest rates on the convertible note in the amount of $14,795 for the three months ended March 31, 2022.
The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef