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Related Party Transactions
 3 Months Ended
May 31, 2017
Notes to Financial Statements  
Note 5. Related Party Transactions

Advances from Major Shareholder

 

Mr. Daniel Solomita, the Company’s major stockholder and CEO, or companies controlled by him, previously made advances to the Company. The advances were unsecured, non-interest bearing with no formal terms of repayment. As of February 28, 2017, the aggregate amount due to Mr. Solomita or companies controlled by him was $391,695. During the period ended May 31, 2017, the Company repaid to Mr. Solomita or companies controlled by him, as applicable, an aggregate amount of $278,472 and reclassified from value added taxes and other receivables an aggregate amount of $113,223.

 

Employment Agreement and Accrued Compensation due to Major Shareholder

 

The Company entered into an employment agreement with Daniel Solomita, the Company’s President and Chief Executive Officer for an indefinite term. During the term, the officer shall receive monthly salary of $15,000. Compensation expense under this agreement amounted to $45,000 during the three months ended May 31, 2017 and May 31, 2016. As of May 31 and February 28, 2017, accrued compensation of $35,156 and $360,000, respectively, was due to Mr. Solomita. On May 5, 2017, the total accrued compensation due to Mr. Solomita for an amount of $360,000 was paid.

  

In addition, the Company agreed to grant the officer 4 million shares of the Company’s common stock, form of equity to be determined, if certain milestones were met.

 

Effective April 10, 2017, the Company qualified to trade on the OTCQX and began trading the same date. Accordingly, as at May 31, 2017, the officer’s entitlement to 1,000,000 shares with a fair value of $5,500,000, in aggregate, have vested. The milestones for the remaining 3,000,000 shares of common stock have not yet been met.