XML 20 R9.htm IDEA: XBRL DOCUMENT v3.19.1
Related Party Transactions
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Note 3. Related Party Transactions

As of March 31, 2019 and December 31, 2018, notes payable to related parties totaled $129,121 and $8,121, respectively. These amounts are owed to Doug Beplate, our Chief Executive Officer. During the three months ended March 31, 2019, Mr. Beplate advanced the Company $121,000. During the year ended December 31, 2018, Mr. Beplate gave a personal vehicle to an employee of the Company valued at $30,000 in lieu of the Company paying travel expenses and consulting expenses. During 2018, the Company repaid a net amount of $305,207 of the outstanding notes payable balance from proceeds of private placements. These loans were for operating expenses of the Company, are due on demand and have no interest rate.

 

Per Mr. Beplate’s services agreement, he receives monthly compensation of $15,000 per month. During the year ended December 31, 2018, he received his entire salary of $180,000 and $61,500 of previously accrued compensation was paid, leaving a balance of $25,000.  During the three months ended March 31, 2019, $45,000 of compensation was accrued, leaving a balance of $70,000.

 

During the period ended March 31, 2019, 1,600,000 shares of common stock issued to Nate Knight who is the Chief Financial Officer of the Company, 500,000 shares of common stock issued to the office administrator, who is a person affiliated with the Company’s CEO and 50,000 shares of common stock issued to a Technical Product Supervisor, who is the son of the office administrator which had been held in escrow became vested by the Board of Directors. These shares had a fair market value of $1.09 per share at the date of issuance and $2,343,500 has been expensed during the three-month period ended March 31, 2019.

 

 The Company, by board resolution, approved an executive compensation stock bonus package for Mr. Beplate such that upon the sale of all or substantially all of the assets of the Company or other change in control or merger transaction in which the Company is involved, or in the event that no such transaction occurs by December 31, 2019, Mr. Beplate shall receive an amount equal to 15% post issuance of the then outstanding shares of the Company's common stock on a fully diluted basis. It was intended that the board approved stock bonus package will be in lieu of the 5% stock bonus that Mr. Beplate is already entitled to in the event of a sale of the Company’s assets or change in control or merger transaction per his services agreement. See “Note 4” regarding the granting of Restricted Stock Unit Agreements (“RSU’s”) to various officers, directors and consultants covering an aggregate of 50,100,000 shares of common stock to be issued upon the satisfaction of certain conditions described in Note 4. Included in the RSU’s are 33,000,000 to Douglas Beplate in lieu of the compensation stock bonus package described above.

 

During the three months ended March 31, 2019, the Company issued 100,000 shares of common stock to each of two directors for services rendered.  The shares had a fair market value of $200,000.