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RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2019

14	RELATED PARTY TRANSACTIONS

The following transactions were entered into with related parties:

LOANS PAYABLE

Description	Interest Rate			Maturity Date	June 30, 2019		December 31, 2018

Vladimir Skigin
Equipment funding		36	%	On Demand	$	91,188	$	81,316
Promissory note		15	%	January 11, 2020		59,199		55,474

Notes payable – Related parties					$	150,377	$	136,790

Interest expense totaled $6,814 and $32,898 for the three months ended June 30, 2019 and 2018, respectively and $13,598 and $102,646 for the six months ended June 30, 2019 and 2018, respectively.

Vladimir Skigin

Vladimir Skigin has personally advanced the Company equipment funding. Mr. Skigin is considered to be a related party as his shareholding and that of the Company's under his control exceeds 5%.

Equipment funding

The Company entered into an agreement with Gibbs, whereby the importation of kiosks and accessories was arranged and funded by Gibbs, Skigin funded a portion of the kiosks and accessories purchased under the same terms and conditions of the agreement entered into with Gibbs. In terms of the agreement, a 5% margin has been added to the cost of the kiosks and accessories purchased and to the liability outstanding. The amount was due on November 1, 2017. The amount has not been paid to date. The agreement does not provide for any default provisions and management is currently negotiating the terms of repayment with Skigin. A penalty interest rate has been provided for on the loan.

The balance of the note plus accrued interest at June 30, 2019 is $91,188.

Promissory note

On April 17, 2018, the Company issued a Promissory Note in the aggregate principal amount of $49,491 to Vladimir Skigin. The note has a maturity date of September 13, 2018 and a coupon of eighteen percent per annum. The Company has the right to prepay the note without penalty prior to maturity date. On September 13, 2018, the maturity date of the note was extended to January 11, 2019. On February 21, 2019 the maturity date was extended to September 13, 2019, with the interest rate changed to 15%.

The balance of the note plus accrued interest at June 30, 2019 is $59,199.

CONVERTIBLE NOTES PAYABLE

											June 30 2019		December 31 2018
Description	Interest rate			Maturity Date	Principal		Accrued interest		Unamortized debt discount		Balance, net		Balance, net

Cobbolo Limited		15	%	December 26, 2019		53,438		15,263		—		68,701		64,726
		15	%	December 26, 2019		52,959		15,126		—		68,085		64,146

Total convertible notes payable					$	106,397	$	30,389	$	—	$	136,786	$	128,872

Interest expense, together with amortized debt discount totaled $3,979 and $7,968 for the three months ended June 30, 2019 and 2018, respectively and $7,914 and $515,579 for the six months ended June 30, 2019 and 2018, respectively.

The convertible notes above have a fixed conversion price of $0.20 per common share.

Vladimir Skigin

Vladimir Skigin is the principal and has control over Cobbolo Limited and has also personally advanced the Company funds.

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Cobbolo Limited

On June 29, 2017, the Company exchanged a note issued to Cobbolo Limited with a principal amount of $50,000, together with accrued interest thereon of $3,438, totaling $53,438, for a convertible note, principal amount of $53,438, bearing interest at 12% per annum and matured on December 26, 2017. In terms of an agreement entered into with the note holder, the maturity date was extended to December 26, 2018 and the interest rate was increased to 15% per annum. On February 21, 2019 the maturity date was extended to December 26, 2019, with the interest rate remaining unchanged. The note is convertible into common shares of the Company at a conversion price of $0.20 per share.

The balance of the note plus accrued interest at June 30, 2019 was $68,701.

On June 29, 2017, the Company exchanged a note issued to Cobbolo Limited with a principal amount of $50,000, together with accrued interest thereon of $2,959, totaling $52,959, for a convertible note, principal amount of $52,959, bearing interest at 12% per annum and matured on December 26, 2017. In terms of an agreement entered into with the note holder, the maturity date was extended to December 26, 2018 and the interest rate was increased to 15% per annum. On February 21, 2019 the maturity date was extended to December 26, 2019, with the interest rate remaining unchanged. The note is convertible into common shares of the Company at a conversion price of $0.20 per share.

The balance of the note plus accrued interest at June 30, 2019 was $68,085.

In connection with the Convertible notes above, the Company issued a warrant to purchase 531,987 common shares of the Company at a variable exercise price of $0.20 per share, if the convertible note above is converted into common shares prior to its maturity date or $0.30 per share if the convertible note is not converted prior to its maturity date.