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RELATED PARTY TRANSACTIONS
3 Months Ended
Jun. 30, 2019
RELATED PARTY TRANSACTIONS  
NOTE 7 - RELATED PARTY TRANSACTIONS

Transaction with SBS Management LL

 

During the period SBS Management LLC, a company controlled by Mr. Scott Stevens, who was appointed to the Companys board of directors on April 15, 2019 made advances to the Company to cover certain operating expenses. These advances are unsecured, non-interest bearing, with no formal terms of repayment. As of June 30, 2019, the amounts due SBS were $19,805 and are included in accounts payable on the accompanying balance sheet. During the three months ended June 30, 2019, the Company paid SBS Management LLC $37,500 for management services. In addition, the Company reimbursed SBS Management LLC $15,000 for rent expense which amount has been included in general and administrative expense for the period. There were no such amounts invoiced during the three months ended June 30, 2018.

 

Convertible Notes Payable - Related Parties

 

On May 15, 2019, the Companys Board of Directors approved the issuance of a convertible promissory note (the Note) in the principal amount of $250,000 to Greys Peak Ventures LLC, an investment firm whose partners include Scott Stevens and Chris Bridges, both directors of the Company. The Note is due December 31, 2019, holds a 0% interest rate, and is convertible at any time, in the sole discretion of the holder of the Note, into shares of common stock of the Company at a purchase price of $1.00 per share. As of June 30, 2019, the Company had borrowed $140,000 against the Note.

 

A portion of the Notes were issued when the market price of the Companys common stock was in excess of the $1.00 per share conversion price creating a beneficial conversion feature associated with these Notes with an aggregate amount of $6,000 at issuance dates. As such, the Company recorded the $6,000 intrinsic value of the beneficial conversion feature at issuance dates of the Notes as additional paid-in capital, and recognized as a debt discount. The debt discount is being amortized as interest expense over the terms of the related notes. During the three-month period ended June 30, 2019, the Company recorded amortization of the debt discount of $912 as interest expense. As such, unamortized debt discount as of June 30, 2019 related to these Notes was $5,088.