Related Party Transactions	12 Months Ended
May 31, 2014
Related Party Transactions
Related Party Transactions	Note T – Related Party Transactions Borrowing and other transactions of Largest Shareholder and CEO For the past several years the Company’s operating expenses were partially funded by advances from its largest shareholder and chief executive officer, John M. Jacobs. The source of funding for these advances originated with obligations incurred by Mr. Jacobs with third parties (such obligations together with the loans by Mr. Jacobs to the Company, “back-to-back loans”) with interest rates ranging from 6% to 12%. This amount is unsecured and payable on demand. To assure that repayments of the various borrowings by the Company that were either guaranteed by Mr. Jacobs or loaned to the Company by Mr. Jacobs via such back-to-back loan arrangements did not result in a deemed loan to Mr. Jacobs, because Mr. Jacobs entered into an Assumption Agreement with the Company. Pursuant to the assumption agreement Mr. Jacobs assumes, and agrees to hold the Company harmless from, principal of specified indebtedness of the Company and to fully offset when necessary what might otherwise be deemed an advance of funds arising out of the Company’s financing activities. During fiscal 2014, advances to the Company from Mr. Jacobs amounted to $1,040,612, and repayments to Mr. Jacobs amounted to $855,019. As of May 31, 2014, the balance due Mr. Jacobs was $10,281. The largest aggregate amount outstanding to Mr. Jacobs in fiscal 2014 was $103,539. During fiscal 2013, advances to the Company from Mr. Jacobs amounted to $1,310,925, which included assumption of company debt in the amount of $319,653, and repayments to Mr. Jacobs amounted to $1,429,190. As of May 31, 2013, the balance due the Company from Mr. Jacobs was $175,312. The largest aggregate amount outstanding to Mr. Jacobs in fiscal 2013 was $20,925. As of June 30, 2017, $22,500 was owed to Mr. Jacobs by the Company. The rate of interest on such amounts due from and obligations due to Mr. Jacobs was 6% and 12% respectively for 2014. The rate of interest on such amounts due from and obligations due to Mr. Jacobs was 12% for 2013. Other related parties During the years ended May 31, 2014 and May 31, 2013, a company owned by a board member provided consulting services. This company provided services totaling $62,100 and $62,100 in 2014 and 2013. Amounts owed to this company at year end are treated as related party payables in the amounts $136,775 and $124,409 at May 31, 2014 and 2013 respectively. During the year ended May 31, 2009, the Company borrowed money from an individual that became a board member during 2010. On March 22, 2013 this individual resigned his duties as a board member. Total amounts owed to this individual at May 31, 2014 consisted of $75,000 in demand notes and $360,000 in bridge financing.

Related Party Transactions

12 Months Ended

May 31, 2014

Note T – Related Party Transactions

Borrowing and other transactions of Largest Shareholder and CEO

For the past several years the Company’s operating expenses were partially funded by advances from its largest shareholder and chief executive officer, John M. Jacobs. The source of funding for these advances originated with obligations incurred by Mr. Jacobs with third parties (such obligations together with the loans by Mr. Jacobs to the Company, “back-to-back loans”) with interest rates ranging from 6% to 12%. This amount is unsecured and payable on demand.

To assure that repayments of the various borrowings by the Company that were either guaranteed by Mr. Jacobs or loaned to the Company by Mr. Jacobs via such back-to-back loan arrangements did not result in a deemed loan to Mr. Jacobs, because Mr. Jacobs entered into an Assumption Agreement with the Company. Pursuant to the assumption agreement Mr. Jacobs assumes, and agrees to hold the Company harmless from, principal of specified indebtedness of the Company and to fully offset when necessary what might otherwise be deemed an advance of funds arising out of the Company’s financing activities.

During fiscal 2014, advances to the Company from Mr. Jacobs amounted to $1,040,612, and repayments to Mr. Jacobs amounted to $855,019. As of May 31, 2014, the balance due Mr. Jacobs was $10,281. The largest aggregate amount outstanding to Mr. Jacobs in fiscal 2014 was $103,539.

During fiscal 2013, advances to the Company from Mr. Jacobs amounted to $1,310,925, which included assumption of company debt in the amount of $319,653, and repayments to Mr. Jacobs amounted to $1,429,190. As of May 31, 2013, the balance due the Company from Mr. Jacobs was $175,312. The largest aggregate amount outstanding to Mr. Jacobs in fiscal 2013 was $20,925.

As of June 30, 2017, $22,500 was owed to Mr. Jacobs by the Company.

The rate of interest on such amounts due from and obligations due to Mr. Jacobs was 6% and 12% respectively for 2014. The rate of interest on such amounts due from and obligations due to Mr. Jacobs was 12% for 2013.

Other related parties

During the years ended May 31, 2014 and May 31, 2013, a company owned by a board member provided consulting services. This company provided services totaling $62,100 and $62,100 in 2014 and 2013. Amounts owed to this company at year end are treated as related party payables in the amounts $136,775 and $124,409 at May 31, 2014 and 2013 respectively.

During the year ended May 31, 2009, the Company borrowed money from an individual that became a board member during 2010. On March 22, 2013 this individual resigned his duties as a board member. Total amounts owed to this individual at May 31, 2014 consisted of $75,000 in demand notes and $360,000 in bridge financing.