Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 8 COMMITMENTS AND CONTINGENCIES

Consulting Agreements

Effective as of April 26, 2021, the Company entered into a Consulting Agreement with Benchmark Capital, LLC, a company formed under the laws of New Jersey (“Benchmark”). Pursuant to this agreement, Benchmark was engaged as a consultant to the Company, to assist with all filings requirements with the SEC. The term of the agreement is month-to-month; provided, however, that each party has the right to terminate the agreement upon 30 days’ prior written notice to the other. Pursuant to the agreement, Benchmark shall receive $7,500 per month, during the term of the agreement, starting on June 1, 2021, in addition to reimbursement of expenses approved in advance by the Company.

Effective as of May 1, 2020, the Company entered into a Consulting Agreement with Tryon Capital Ventures LLC, a North Carolina limited liability company (“Tryon”), which is 50% owned by the father of Peter L. Coker, Jr., our Chairman of the Board. Pursuant to this agreement, Tryon was engaged as a consultant to the Company, to, among other things, support in the research, development, and analysis of product, financial and strategic matters. The term of the Tryon Consulting Agreement was one year; provided, however, that each party had the right to terminate the agreement upon 30 days’ prior written notice to the other. Pursuant to the agreement, Tryon was to receive $15,000 per month during the term of the agreement, in addition to reimbursement of expenses approved in advance by the Company. On April 26, 2021, the Company terminated the consulting agreement with Tryon (See Note 9). 

Effective as of May 1, 2020, the Company also entered into a Consulting Agreement with VCH Limited, a company formed under the laws of Macau (“VCH”), which owns in excess of 10% of the Company’s common stock. Pursuant to this agreement, VCH was engaged as a consultant to the Company, to, among other things, create and build a presence with high net worth and institutional investors. The term of the agreement is one year; provided, however, that each party has the right to terminate the agreement upon 30 days’ prior written notice to the other. Pursuant to the agreement, VCH shall receive $25,000 per month during the term of the agreement, in addition to reimbursement of expenses approved in advance by the Company. Upon expiration, the agreement was not renewed. (See Note 9). 

Operating Lease Agreement

On July 1, 2014, the Company entered into a five-year non-cancelable operating lease with a related party for its store space at a monthly rate of $500. On September 21, 2015, the Company executed the lease and opened the delicatessen on October 14, 2015. On December 29, 2015, the Company signed an addendum to the lease for the lease agreement to start 30 days after the opening of the delicatessen. The delicatessen opened on October 14, 2015, and the first payments would have been due on November 15, 2015, however, since the delicatessen was not fully functioning, the first monthly rent payment was due January 1, 2016. On August 12, 2019, the Company was granted a two-year extension of non-cancelable operating lease with a related party for its store space at a monthly rate of $500. For the six months ended June 30, 2021 and 2020, the Company had a rent expense of $3,000 and $3,000, respectively. On March 22, 2021, the Company was granted an additional two-year extension of non-cancelable operating lease with a related party for its store space at a monthly rate of $500 (See Note 9). The Company accounts for lease in accordance with ASC Topic 842, “Leases”.

Operating lease assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The operating lease right-of-use (ROU) asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred, if any. In calculating the present value of the revised lease payments, the Company elected to utilize its incremental borrowing rate based on the revised lease terms as of the March 22, 2021, re-measurement date. This rate was determined to be 10%, and the Company determined the initial present value, at inception, of $10,569.

The lease expense is recognized over the expected term on a straight-line basis. Operating leases are recognized on the balance sheet as operating lease assets, current operating lease liabilities and non-current operating lease liabilities.

Supplemental consolidated balance sheet information related to leases was as follows:

Operating Leases

	June 30, 2021 (Unaudited)
Operating lease assets - right of use	$	10,835
Lease liability is summarized below:
Lease Liability	$	10,835
Less: operating lease liability, current		(5,148	)
Long term operating lease liability	$	5,687
Maturities of lease liabilities at June 30, 2021 are as follows:
2021	$	3,000
2022		6,000
2023		3,000
Total lease liability		12,000
Less: present value discount		(1,165	)
Total lease liability	$	10,835

Supplemental disclosures of cash flow information related to leases were as follows:

	For the six months ended June 30, 2021		For the six months ended June 30, 2020
	(Unaudited)		(Unaudited)
Cash paid for operating lease liabilities	$	3,000	$	3,000

	For the six months ended June 30, 2021		For the six months ended June 30, 2020
	(Unaudited)		(Unaudited)
Operating lease asset obtained for operating lease liability upon remeasurement	$	10,569	$	-

For the three months ended June 30, 2021 and 2020, the total lease costs were $1,500 and $1,500, respectively. The Company did not incur any variable lease cost for both periods.

For the six months ended June 30, 2021 and 2020, the total lease costs were $3,000 and $3,000, respectively. The Company did not incur any variable lease cost for both periods.