Note 10 - Related Party Relations and Transactions

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

Note

10.

Related Party Relations and Transactions

Gary O. Marino, the Company’s chairman of the board, is the chairman, president, and chief executive officer of Boca Equity Partners LLC (“BEP”), Patriot Equity LLC (“Patriot”), Banyan Medical Partners LLC (“BMP”), and Banyan Surprise Plaza LLC (“BSP”). Mr. Marino owns

100%

of Patriot, Patriot owns

100%

of BMP and BSP through and along with other wholly owned subsidiaries. Mr. Marino, Mr. Paul S. Dennis,Mr. Donald Denbo and Mr. Bennett Marks, members of the Company's board of directors, Mr. Joseph Bencivenga, a member of the Company’s board of directors and the Company’s President and Chief Executive Officer and Ms. Patricia Sheridan, the Company’s Chief Financial Officer also hold membership interests in BEP.

During

2016,

the Company established BMP, and certain other subsidiaries wholly-owned by BMP. The Company formed these entities to acquire medical office buildings in the United States. The Company was unable to raise the capital needed to consummate the

first

medical building opportunity. On

March 9, 2017,

the Company sold BMP and BMP’s wholly-owned subsidiaries to Patriot. The selling price was

$277,756

in the form of BMP assuming a portion of the Company’s note payable balance due to BEP. The consideration of

$277,756

was used to recoup the

$110,000

in property deposits as of

December 31, 2016

and reimbursement of

$117,756

of other

2016

and

2017

expenses incurred by the Company on behalf of BMP. This reimbursement of expenses is offset in general and administrative expenses.  

On

July 27, 2016,

the Company entered into a Demand Note and Loan Agreement (the “Note”) with BEP providing for draws of up to

$250,000.

Loans under the Note bore interest at an annual rate of

10%

and outstanding principal and interest were due on demand. This Note was cancelled and terminated on

December 31, 2016

when the Company entered into a new Demand Note and Loan Agreement (the “New Note”) with BEP for

$471,826.

The New Note represents advances from BEP under the New Note, payments made since the date of the New Note and interest accrued thereon. The New Note bore interest at the rate of

10%

per annum and is payable upon demand. BEP is committed to making advances to the Company under the New Note as the Company

may

from time to time request. The balance drawn on the New Note including accrued interest was paid in full

May 31, 2017.

The Note remains available to the Company to draw upon until

May 2020

and the balance as of the date of this report due under the New Note is

$0.

On

September 13, 2018,

the Company entered into an office lease and administrative support agreement (the

“2018

Lease Agreement”) with BEP. The

2018

Lease Agreement has a month-to-month term commencing on

September 1, 2018.

The

2018

Lease Agreement provides for the Company’s use of a portion of BEP’s offices and certain overhead items at the BEP offices such as space, utilities and other administrative services for

$5,000

a month. The

2018

Lease Agreement replaces the

June 8, 2017

office lease and administrative support agreement between the Company and BEP. Total expense incurred under these agreements amounted to

$140,000

and

$138,025

for the years ended

December 31, 2018

and

2017,

respectively.

During

2018

the Company's President and CEO performed work for International Rail Partners LLC (“IRP”), an entity controlled by the Company’s Chairman. The Company billed back IRP for compensation and expenses in the amount of

$125,090

for the year ended

December 31, 2018.

The Company’s directors have

not

received cash compensation for their services in

2018

or

2017

but were compensated with stock options. See footnote

9

Stock-Based Compensation for further discussion. In the

third

quarter of

2017,

the Company hired a new president and chief executive officer and a new chief financial officer who are husband and wife. Also, in the

third

quarter of

2017,

the Company issued

15,000

common stock options to the president and CEO and

45,000

shares to other board members and officers. The related stock compensation was

not

material.

As of

December 31, 2018,

the Company’s board of directors and officers beneficially own

838,060

shares of the Company’s common stock or

32.10%

of the outstanding common stock. Included in the

838,060

shares are

351,966

shares owned by Marino Family Holdings LLC controlled by our chairman, Gary O. Marino, and

91,348

shares owned by Banyan Rail Holdings LLC, of which Mr. Marino is the president and significant stockholder. 

Paul Dennis, director and previously interim president, interim chief executive officer and interim chief financial officer, participated in the

2017

Private Placement by investing

$150,000

for

100,000

shares of common stock.