v3.22.1
Interest, advances and promissory notes payable
 3 Months Ended
Mar. 31, 2022
Interest Advances And Promissory Notes Payable  
Interest, advances and promissory notes payable

4.       Interest, advances and promissory notes payable

 

a)       Promissory notes payable to related parties

 

A summary of activities of promissory notes payable to related parties is as follows:

 

Summary of activities of promissory notes payable   
Promissory Notes Payable to Related Parties  Carrying Value
Balance, December 31, 2020  $3,031,966 
Transferred from promissory notes payable pursuant to private transaction   10,000 
Balance, December 31, 2021 and March 31, 2022  $3,041,966 

 

A summary of the promissory notes payable to related parties is as follows:

 

       
Promissory Notes Payable to Related Parties

March 31,

2022

 December 31, 2021
Promissory notes payable to relatives of directors collateralized by a general security agreement over all the assets of the Company, past maturity:        
i.        Interest at 1% per month $ 720,619 $ 720,619
ii.      Interest at 1.25% per month   51,347   51,347
iii.    Interest at the U.S. bank prime rate plus 1%   100,000   100,000
iv.     Interest at 0.5% per month   695,000   695,000
         
Promissory notes payable, unsecured, to relatives of a director, bearing interest at 1% per month, past maturity   1,475,000   1,475,000
Total Promissory Notes Payable to Related Parties $ 3,041,966 $ 3,041,966
                   

 

All amounts past maturity continue to accrue interest at their stated rates and are considered due on demand.

 

b)       Promissory notes payable to unrelated parties

 

A summary of activities of promissory notes payable to unrelated parties is as follows:

 

     
Promissory Notes Payable to Unrelated Parties  Carrying Value
Balance, December 31, 2020  $2,254,353 
Reclassified to interest payable   (10,985)
Extinguished through issuance of shares of common stock (note 6)   (20,000)
Transferred to promissory notes payable pursuant to private transaction   (10,000)
Balance, December 31, 2021   2,213,368 
Promissory note received   199,395 
Balance, March 31, 2022  $2,412,763 

 

A summary of the promissory notes payable to unrelated parties is as follows:

 

       
Promissory Notes Payable to Unrelated Parties

March 31,

2022

December 31,

2021

Unsecured promissory notes payable to unrelated lenders, past maturity:        
i.        Interest at 1% per month $ 1,317,456 $ 1,317,456
ii.      Interest at 0.667% per month   425,000   425,000
iii.    Interest at 0.625% per month   150,000   150,000
iv.     Non-interest-bearing   270,912   270,912
v.       Fixed interest   199,395   -
         
Promissory notes payable, secured by a guarantee from the Chief Executive Officer, bearing interest at 1% per month past maturity   50,000   50,000
Total Promissory Notes Payable to Unrelated Parties $ 2,412,763 $ 2,213,368
                   

 

The Company received an advance from a shareholder for Singapore dollars (“SGD”) $270,000 (US$199,395), with a fixed interest amount of SGD$8,000, which will mature and be repayable on July 31, 2022.

 

All amounts past maturity continue to accrue interest at their stated rates and are considered due on demand.

c)       Interest payable

 

A summary of the interest payable activity is as follows:

 

Schedule of interest payable activity   
Interest Payable  Carrying Value
Balance, December 31, 2020  $3,575,326 
Reclassified from promissory notes payable   10,985 
Interest incurred on promissory notes payable   527,336 
Interest payable retired through issuance of shares   (3,000)
Balance, December 31, 2021   4,110,647 
Interest incurred on promissory notes payable   137,536 
Balance, March 31, 2022  $4,248,183 

 

Interest payable is due to related and non-related parties as follows:

 

          
Interest Payable 

March 31,

2022

  December 31, 2021
Related parties  $1,279,462   $1,200,170 
Unrelated parties   2,968,721    2,910,477 
Interest payable  $4,248,183   $4,110,647 

 

The payment terms, security and any interest payable are based on the underlying promissory notes payable that the Company has outstanding.

 

d)       Interest expense

 

During the period ended March 31, 2022, the Company incurred interest expense of $550,636 (2021 - $479,367) as follows:

 

·$384,922 (2021 - $314,737) incurred on lines of credit payable as shown in note 5;
·$137,536 (2021 - $132,218) incurred on promissory notes (notes 4(a) and 4(b));
·$26,138 (2021 - $31,963) incurred from the calculation of imputed interest on accounts payable outstanding for longer than one year, advances payable and promissory notes payable, which had no stated interest rate; and
·$2,040 (2021 - $449) interest on other items.