Notes Payable and Notes Payable - Related Parties

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

NOTES PAYABLE AND NOTES PAYABLE - RELATED PARTIES

NOTE 6 – NOTES PAYABLE AND NOTES PAYABLE - RELATED PARTIES

At March 31, 2019 and December 31, 2018, notes payable consisted of the following categories:

	March 31, 2019	December 31, 2018
Notes payable	$328,783	$328,783
Notes payable, convertible	25,000	25,000
Notes payable, related parties	926,475	926,475
Notes payable, related parties, convertible	1,327,450	1,327,450
Total	$2,607,708	$2,607,708

Notes Payable

Notes payable consisted of two unsecured notes. The first note payable in the amount of $28,783 as of March 31, 2019 and December 31, 2018, respectively, is to a former shareholder with a due date of January 2012, together with accrued interest at 5% APR and interest on overdue principal accruing at 10% APR. The second note payable in the amount of $300,000 as of March 31, 2019 and December 31, 2018, respectively, is to a shareholder with a due date of August 1, 2015, together with accrued interest at 10% APR.

At March 31, 2019, the Company was in default for both unsecured notes payable and all related accrued interest.

Notes Payable, Convertible

Notes payable, convertible consisted of one note payable in the amount of $25,000 as of March 31, 2019 and December 31, 2018, respectively, to an investor with a due date of January 20, 2018, together with accrued interest at 10% APR and is convertible at $0.01 per share of common stock.

At March 31, 2019, the Company was in default for this secured note payable and all related accrued interest.

Notes Payable, Related Parties

Notes payable, related parties consisted of the following:

		March 31, 2019	December 31, 2018
Note payable to the Company's general counsel (also a shareholder), due November 10, 2017.	(a)	$7,000	$7,000
Note payable to an independent contractor (also a shareholder), which note payable was due December 3, 2017.	(b)	10,000	10,000
Note payable to an independent contractor (also a shareholder), which note payable was due December 20, 2017.	(c)	10,000	10,000
Note payable to an independent contractor (also a shareholder), which note payable was due March 16, 2018.	(d)	10,000	10,000
Note payable to an independent contractor (also a shareholder), which note payable was due June 22, 2018.	(e)	10,000	10,000
Two notes payable ($150,000 and $120,000) each to the Company's general counsel (also a shareholder), due on demand together with accrued interest at 4.5% APR.	(f)	270,000	270,000
Note payable to the Company's general counsel (also a shareholder), due on demand together with accrued interest at 12% APR.	(g)	10,000	10,000
Two notes payable ($349,329 and $87,532) each to the Company's president and chief executive officer (also a shareholder), due on demand together with accrued interest at 4.5% APR.	(h)	436,861	436,861
Two notes payable ($134,604 and $28,010) each to the Company's controller (also a shareholder), due on demand together with accrued interest at 4.5% APR.	(i)	162,614	162,614
Total		$926,475	$926,475

At March 31, 2019, the Company was in default with the contractual payment terms with the unsecured term note payable (a) to the Company's general counsel, also a shareholder, and on the unsecured term note payables (b), (c), (d) and (e) to an independent contractor, also a shareholder.

Note (f) reflects two unsecured notes payable for payment obligations owed to the Company's general counsel for legal services incurred by the Company for the years ended December 31, 2015 and 2014. In addition, note (g) reflects a debt investment made by the Company's general counsel to the Company.

Note (h) reflects two unsecured notes payable for amounts due to the Company's president and chief executive officer, who is also a shareholder, for previously accrued base salary.

Note (i) reflects two unsecured notes payable for amounts due to the Company's controller, who is also a shareholder, for previously accrued base salary.

On December 24, 2018, and in connection with the Company's acquisition of Advanced Cement Sciences LLC, each holder of notes (f), (h) and (i) agreed to relinquish their previous respective rights of conversion on the Company promissory notes held by them.

Notes Payable, Related Parties, Convertible

Notes payable, related parties, convertible consisted of the following:

		March 31, 2019	December 31, 2018
Note payable to a company controlled by an outside director (also a shareholder), due on demand together with accrued interest at 4.5% APR, and convertible at $0.01 per share of common stock.	(a)	$60,000	$60,000
Three notes payable ($30,000, $55,500 and $28,500) each to an outside director (also a shareholder), due on demand together with accrued interest at 4.5% APR, and convertible at $0.01, $0.007 and $0.015, respectively, per share of common stock.	(b)	114,000	114,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due November 13, 2018 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(c)	100,000	100,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due March 4, 2017 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(d)	50,000	50,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due March 18, 2019 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(e)	100,000	100,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due May 12, 2019 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(f)	50,000	50,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due June 7, 2019 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(g)	200,000	200,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due July 28, 2019 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(h)	300,000	300,000
Two notes payable ($20,500 and $9,500) each to an outside director (also a shareholder), due on demand together with accrued interest at 4.5% APR, and convertible at $0.007 and $0.015, respectively, per share of common stock.	(i)	30,000	30,000
Note payable to the Company's former vice president of research and development (also a shareholder), due on demand together with accrued interest at 4.5% APR, and convertible at $0.007 per share of common stock.	(j)	49,000	49,000
Note payable to an independent contractor (also a shareholder), due on demand together with interest at 4.5% APR, and convertible at $0.007 per share of common stock.	(k)	25,700	25,700
Note payable in the name of a son of an outside director (also a shareholder), due on demand together with accrued interest at 4.5% APR, and convertible at $0.05 per share of common stock.	(l)	20,000	20,000
Two notes payable ($81,250 and $77,500) each to an independent contractor (also a shareholder), due on demand together with interest at 4.5% APR, and convertible at $0.01 per share of common stock.	(m)	158,750	158,750
Note payable to an investor (also a shareholder), due on demand together with interest at 10% APR, and convertible at $0.01 per share of common stock.	(n)	20,000	20,000
Note payable to a related party investor (by virtue of shareholding percentage, both actual and on an as-converted basis), due June 15, 2018 together with accrued interest at 10% APR, and convertible at $0.01 per share of common stock.	(o)	50,000	50,000
Total		$1,327,450	$1,327,450

Notes (a), (b) and (l) reflect amounts due to a single outside director of the Company, who also is a shareholder, based on such director having (i) made certain vendor obligation payments directly on behalf of and for the benefit of the Company, (ii) having advanced certain funds to the Company at various dates for general working capital purposes, and (iii) having accrued director's fees earned through June 30, 2017. In addition, the Company has recorded accounts payable, related parties, in the amount of $18,426 to the holder of notes (a), (b), and (l).

Notes (c) through (h) and (o) reflect amounts due to a certain related party investor and significant shareholder for convertible debt investments made from time to time as indicated.

Notes (i) reflects two notes payable for amounts due to an outside director, who is also a shareholder, for accrued director's fees earned through June 30, 2017.

Note (j) reflects amounts due to the Company's former vice president of research and development, who is also a shareholder, for previously accrued wages.

Note (k) reflects amounts due to an independent contractor who was President of one of EcoSmart's divisions prior to the merger with EcoSmart and a current shareholder of the Company, for past earnings. See Note 10.

Note (m) reflects two notes payable for amounts due to an independent contractor, who is also shareholder, for previously accrued business development services. On October 31, 2018, the holder of one note with an original face value of $137,500 exercised the right to convert $60,000 of the note into six million shares (6,000,000) of common stock at the conversion rate of $0.01 per share per the terms of the note.

For the year three months ended March 31, 2019, the Company did not receive any proceeds from the issuance of notes payable. For the year ended December 31, 2018, the Company received proceeds from the issuance of notes payable to related parties in the amount of $20,000 and convertible notes payable to related parties in the amount of $70,000 (total $90,000).

At December 31, 2018, the Company was in default with the contractual payment terms with the convertible note payable (c), (d), (e) and (o) to a related party investor.