Secured Convertible Promissory Notes

9 Months Ended

Jan. 31, 2019

Debt Disclosure [Abstract]

Secured Convertible Promissory Notes

5. Secured Convertible Promissory Notes

As of January 31, 2019, REGI has outstanding senior secured convertible promissory notes (the “Convertible Notes”) of $253,783 (net of unamortized discount of $28,901) issued to related parties and $1,378,472, (net of unamortized discount of $238,855) issued to non-related parties. As of April 30, 2018, REGI has outstanding Convertible Notes of $142,762 (net of unamortized discount of $54,816) issued to related parties and $997,468 (net of unamortized discount of $523,658) issued to non-related parties.

During the nine months ended January 31, 2019 the Company issued Convertible Notes for service debt provided by related parties of $79,332 and $16,357 to non-related parties. During the nine months ended January 31, 2019 the Company issued Convertible Notes for cash proceeds of $39,200 to related parties and $457,355 to non-related parties while redeeming $16,000 of related parties and $150,000 or non-related parties Convertible Notes for cash.

The Convertible Notes are secured against all assets of the Company, repayable two years after the issuance, bearing simple interest rate of 10% during the term of the notes and simple interest rate of 20% after the due date with the exception of one Convertible Note of $220,000 (net of unamortized discount of $14,861) repayable six months after issuance, bearing simple interest of 12% during the term of the note and simple interest rate of 24% after the due date.

As of January 31, 2019, $17,436, $40,000, $1,682,576, $60,000 and $100,000 of the Convertible Notes are convertible at any time on or after ninety days from the issuance date into the Company’s common stocks at $0.174, $0.12, $0.10, $0.09 and $0.08 per share respectively.

The Company analyzed the conversion option in the notes for derivative accounting treatment under ASC Topic 815, “Derivatives and Hedging,” and determined that the instrument does qualify for derivative accounting.

The Company determined that the conversion option was subject to a beneficial conversion feature and during the nine months ended January 31, 2019 the company recorded amortization of the beneficial conversion feature of $507,066 as interest expense.