RELATED PARTY LOANS |
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Jun. 30, 2018 | ||||||||||||||||||||||||||||
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| RELATED PARTY LOANS | NOTE 6: RELATED PARTY LOANS: according to ASC 850, an entity and its principal owners and members of their immediate families are considered related parties.
Convertible Notes Payable
On February 21, 2018 Crown Bridge Partners LLC, sold part of its potentially dilutive convertible advance to D&D Capital, Inc, a related party. Accrued interest related to this advance was $1,855 and $0 at June 30, 2018 and December 31, 2017, respectively, and is included in accrued interest on the Balance Sheets. Face value balance as of June 30, 2018 is $40,000. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2018 dividend yield of zero, 230 days term to maturity, risk free interest rate of 2.33% and annualized volatility of 4.22%, valued at $125,311. The value of the conversion feature was assigned to the derivative liability and created a debt discount to be amortized over the life of the convertible debt. During the three months ended March 31, 2018, Kodiak Capital declared a default of the note payable to them invoking 22% retroactive interest and also put into effect a penalty of $2,000 per day for non-delivery of conversion for the shares according to the note agreement, which led to increasing the balance of the note to $142,633 (including $2,630 accrued interest on the Kodiak note) at March 31, 2018. On February 15, 2018, S&E Capital, LLC, a related party to Mining Power Group Inc., reached an agreement with Kodiak Capital to purchase the note. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2018 dividend yield of zero, 0.25 year term to maturity, risk free interest rate of 1.93% and annualized volatility of 38.55%, valued at $125,311. The value of the conversion feature was assigned to the derivative liability and created a debt discount to be amortized over the life of the convertible debt. Face Value balance as of December 31, 2017 was $34,084 and as of June 30, 2018 was $151,058.
Other Loans The following loans bears no interest and due on demand:
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