NOTES PAYABLE-RELATED PARTIES
|3 Months Ended|
Mar. 31, 2020
|NOTES PAYABLE-RELATED PARTIES|
|Note 11. NOTES PAYABLE-RELATED PARTIES||
As of March 31, 2020, and December 31, 2019, the Company had advances from Kent Emry (Chairman of the Company). The balance outstanding as of March 31, 2020 and December 31, 2019 was $1,500.
On January 26, 2018, the Company issued to Joe Galligan (a holder of between 5% and 10% of the Company’s shares of common stock) one unsecured promissory note of $125,000 bearing interest at 8% per annum with both principal and initially interest due July 26, 2018. In connection with the note issuance, the Company issued 50,000 shares of the Company's common stock to Joe Galligan. The fair value of the common stock at the date of issuance of $12,750 was recorded as a debt discount and is amortized as interest expense over the term of the note. On January 26, 2019, the note was extended until September 26, 2019. On September 23, 2019, the note was extended until September 26, 2020. On December 31, 2019, the note was extended until December 31, 2020. The balance outstanding as of March 31, 2020 and December 31, 2019 was $125,000.
On January 22, 2013, the Company issued an unsecured promissory note payable to Kent Emry (Chairman of the Company) for $200,000 due January 1, 2018, with a stated interest rate of 12% per annum beginning three months from issuance, payable monthly. Principal payments were due starting February 1, 2015 at $6,650 per month. The lender has an option to convert the note to licensing rights for the State of Oregon. The Company currently is in default of the principal and interest. The note holder subsequently became an officer of the Company. The balance outstanding as of March 31, 2020 and December 31, 2019 was $163,610.
The interest expense during the three months ended March 31, 2020 and 2019 were $7,425 and $7,344, respectively. As of March 31, 2020, and December 31, 2019, the accumulated interest on related parties notes payable were $133,328 and $125,903, respectively.