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Commitments, Contingencies and Legal Matters
12 Months Ended
Dec. 31, 2019
Notes  
Commitments, Contingencies and Legal Matters

 

NOTE 10 – Contingencies and Commitments and Legal Matters Agreement and Plan of Merger

 

Management of the Company has conducted a diligent search and concluded that there were no commitments, contingencies, or legal matters pending at the balance sheet dates, other than what has been disclosed below.

 

The Company on May 13, 2019 entered into an Agricultural Lease for approximately 200 acres in Northern Nevada to plant its Hemp Grow for 2019.

 

The term of the lease is for five years commencing May 18, 2019 through May 17, 2024.

 

There are no minimum fixed monthly payments due on this lease, but an annual participation bonus in an amount equal to fifteen percent of the gross crop yield from the leasehold properties.  The Gross Crop Yield is defined by the actual amount received from the crop harvest less all expenses derived from the growing, processing and sale of the crop harvested from the Property. 

 

The Company is solely responsible for all crop care, labor, irrigation, insurance, taxes, repairs and maintenance of the crop, equipment and other costs of planting, raising and harvesting of crops.  The Company is responsible for all other miscellaneous cost to grow and take it to market.

 

Due to the lease payments being variable, the Company has not recorded a right of use asset or lease liability on the balance sheet and will recognize the variable lease payments in the period when the obligation for those payments has occurred in accordance with ASC 842, Leases.

 

No gross crop yields have been achieved by the Company to date, and therefore no lease payments have been made or required under the lease terms.  The Hemp Grow farming activities were ceased at the end of 2019, and the leased property is not currently being used by the Company.