(a) On March 31, 2015, the Company issued a convertible promissory note in the principal amount of $310,000 to a company owned by a director of the Company for marketing services. The convertible promissory note is unsecured, bears interest at 5% per annum, is convertible at $1.25 per common share, and is due on demand. As at June 30, 2018, the carrying value of the convertible promissory note was $310,000 (December 31, 2017 - $310,000).
Third Party Convertible Loans Payable
(b) On August 25, 2015, the Company issued a convertible promissory note in the principal amount of $250,000. The convertible promissory note is unsecured, bears interest at 10% per annum, is due on demand, and is convertible at $1.75 per share. As at June 30, 2018, the carrying value of the convertible promissory note was $250,000 (December 31, 2017 - $250,000).
(c) On November 7, 2016, the Company entered into a securities purchase agreement with a non-related party. Pursuant to the agreement, the Company was provided with proceeds of $125,000 on November 10, 2016 in exchange for the issuance of a secured convertible promissory note in the principal amount of $138,889, which was inclusive of an 8% original issue discount and bears interest at 8% per annum to the holder. The convertible promissory note matures six months from the date of issuance and is convertible at the option of the holder into our common shares at a price per share that is the lower of $0.12 or the closing price of the Company’s common stock on the conversion date. In addition, under the same terms, the Company also issued a secured convertible note of $50,000 in consideration for proceeds of $10,000 and another secured convertible note of $75,000 in consideration for proceeds of $10,000. Under the agreements, the Company has the right to redeem $62,500 and $40,000 of the notes for consideration of $1 each at any time prior to the maturity date in the event that the convertible promissory note is exchanged or converted into a revolving credit facility with the lender, whereupon the two $10,000 convertible note balances shall be rolled into such credit facility.
On May 7, 2017, the Company triggered an event of default in the convertible note by failing to repay the full principal amount and all accrued interest on the due date. The entire convertible note payable became due on demand and would accrue interest at an increased rate of 1.5% per month (18% per annum) or the maximum rate permitted under applicable law until the convertible note payable was repaid in full.
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On May 8, 2017, the Company issued 100,000 common shares for the conversion of $5,000 of the $72,500 convertible note dated November 7, 2016. On May 24, 2017, the Company issued 210,000 common shares for the conversion of $10,500 of the $72,500 convertible note dated November 7, 2016. Refer to Note 11.
On May 25, 2017, the lender provided conversion notice for the remaining principal $57,000 of the $72,500 convertible note dated November 7, 2016. This conversion was not processed by the Company’s transfer agent due to direction from the Company not to honor any further conversion notices from the lender. In response, the Company received legal notification pursuant to the refusal to process further conversion notices. Refer to Note 14.
As at June 30, 2018, the carrying value of the note was $245,889 (December 31, 2017 - $245,889) and the fair value of the derivative liability was $758,016 (December 31, 2017 - $629,759). During the six months ended June 30, 2018, the Company accreted $nil (2017 - $72,099) of the debt discount to finance costs.
(d)
On December 21, 2016, the Company entered into a convertible note agreement for the principal amount of $74,500 for consideration of $72,250 which was received on January 10, 2017. The note is unsecured, bears interest at 12% per annum, was due on December 21, 2017, and is convertible into common shares at a conversion price equal to the lessor of: (i) the closing sale price of the Company’s common stock on the trading day immediately preceding the closing date, and (ii) 50% of the lowest sale price for the Company’s common stock during the twenty-five consecutive trading days immediately preceding the conversion date. Interest will be accrued and payable at the time of repayment of the note. Financing fees on the note were $4,750. The derivative liability applied as a discount on the note was $72,250 and is being accreted over the life of the note.
On July 24, 2017, the Company issued 800,000 common shares for the conversion of $26,850 of principal and a $750 finance fee. On October 10, 2017, the Company issued 1,000,000 common shares for the conversion of $705 of principal, $3,200 of penalty interest, and a $750 finance fee. On October 19, 2017, the Company issued 4,400,000 common shares for the conversion of $4,814 of principal and a $1,500 finance fee. On October 25, 2017, the Company issued 2,700,000 common shares for the conversion of $3,030 of principal and a $750 finance fee. On October 27, 2017, the Company issued 3,000,000 common shares for the conversion of $3,450 of principal and a $750 finance fee. On October 31, 2017, the Company issued 3,000,000 common shares for the conversion of $3,450 of principal and a $750 finance fee. On December 27, 2017, the Company issued 4,200,000 common shares for the conversion of $1,182 of principal and a $750 finance fee. On December 29, 2017, the Company issued 4,600,000 common shares for the conversion of $1,132 of principal and a $750 conversion fee.
During the six months ended June 30, 2018, the Company incurred a default fee of $36,000 for failure to honor the conversion notice in a timely manner and issued 56,200,000 common shares with a fair value of $129,676 for the conversion of $13,461 of principal, $37,491 of default fees and finance costs, $5,250 for conversion fees resulting in a loss on settlement of debt of $73,474.
On May 8, 2018, the Company paid $45,000 to settle the balance of the $74,500 convertible note including accrued interest. The Company recognized a gain on the settlement of this convertible note totaling $24,752.
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $65,887) and the fair value of the derivative liability was $nil (December 31, 2017 - $31,431). During the six months ended June 30, 2018, the Company accreted $nil (2017 - $1,180) of the debt discount and $nil (2017 - $37,905) of the financing fees to finance costs.
(e) On January 18, 2017, the Company issued a convertible promissory note in the principal amount of $75,000. The note is unsecured, bears interest at 12% per annum, was due on October 18, 2017, and is convertible into common shares at a conversion price equal to the lessor of (i) 60% multiplied by the lowest trading price (representing a discount rate of 40%) during the previous twenty-five trading day period ending on the latest complete trading day prior to the date of the note; and (ii) the variable conversion price which means 50% multiplied by the lowest trading price (representing a discount rate of 50%) during the previous twenty five trading day period ending on the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. Financing fees on the note were $2,750. The derivative liability applied as a discount on the note was $75,000 and is being accreted over the life of the note.
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On July 28, 2017, the Company issued 500,000 common shares for the conversion of $4,474 of principal and $4,586 of accrued interest. On September 7, 2017, the Company issued 750,000 common shares for the conversion of $12,549 of principal and $951 of accrued interest. On October 11, 2017, the Company issued 750,000 common shares for the conversion of $3,342 of principal and $648 of accrued interest. On October 20, 2017, the Company issued 2,229,400 common shares for the conversion of $3,369 of principal and $198 of accrued interest. On October 27, 2017, the Company issued 3,017,400 common shares for the conversion of $4,592 of principal and $236 of accrued interest. On November 7, 2017, the Company issued 3,667,000 common shares for the conversion of $5,530 of principal and $337 of accrued interest.
On November 7, 2017, the Company incurred a loan penalty of $15,000 for the conversion price being below the Company’s par value.
On June 1, 2018 the remaining $56,144 principal balance and $2,023 in accrued interest were reassigned to another unrelated note holder and the note was treated as an extinguishment. Upon reassignment, the Company incurred a finance fee of $46,833 which was added to the principle balance of the new convertible note totaling $105,000. Refer to Note 8(z).
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $56,144) and the fair value of the derivative liability was $nil (December 31, 2017 - $70,818). During the six months ended June 30, 2018, the Company accreted $nil (2017 - $3,149) of the debt discount and $nil (2017 - $49,725) of the financing fees to finance costs.
(f) On April 3, 2017, the Company issued a convertible promissory note in the principal amount of $110,000. The note is unsecured, bears interest at 10% per annum, was due on October 3, 2017, and is convertible into common shares at a conversion price equal to the lessor of: (i) 55% multiplied by the lowest trading price during the previous twenty-five trading day period ending on the latest complete trading day prior to the date of this note and (ii) the alternate conversion price which means 55% multiplied by the lowest trading price during the previous twenty-five trading day period ending on the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. In connection with the issuance, the Company issued 550,000 common shares as a commitment fee, however, these common shares must be returned if the note is fully repaid and satisfied prior to the maturity date. Financing fees on the note were $10,000. The derivative liability applied as a discount on the note was $100,000 and is being accreted over the life of the note.
On October 11, 2017, the Company issued 1,415,205 common shares for the conversion of $2,590 of principal and $5,880 of accrued interest. On October 18, 2017, the Company issued 2,123,434 common shares for the conversion of $5,430 of principal and $494 of accrued interest. On October 19, 2017, the Company issued 2,229,450 common shares for the conversion of $3,879 of principal and $134 of accrued interest. On October 23, 2017, the Company issued 2,440,467 common shares for the conversion of $4,134 of principal and $258 of accrued interest. On October 26, 2017, the Company issued 1,791,445 common shares for the conversion of $3,107 of principal and $118 of accrued interest. On October 31, 2017, the Company issued 2,500,728 common shares for the conversion of $4,262 of principal and $239 of accrued interest. On November 2, 2017, the Company issued 1,499,272 common shares for the conversion of $2,528 of principal and $171 of accrued interest. On November 13, 2017, the Company issued 3,017,333 common shares for the conversion of $4,823 of principal and $608 of accrued interest. On November 22, 2017, the Company issued 4,000,565 common shares for the conversion of $4,292 of principal and $469 of accrued interest. On December 27, 2017, the Company issued 4,200,200 common shares for the conversion of $1,656 of principal and $1,725 of accrued interest. On December 29, 2017, the Company issued 4,619,360 common shares for the conversion of $3,347 of principal and $48 of accrued interest. During the six months ended June 30, 2018, the Company issued 247,495,414 common shares with a fair value of $571,886 for the conversion of $69,952 of principal and $56,227 of default fees and finance costs resulting in a loss on settlement of debt of $445,707.
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $69,952) and the derivative liability was $nil (December 31, 2017 - $108,326).
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(g) On June 5, 2017, the Company issued a convertible promissory note in the principal amount of $110,000. The note is unsecured, bears interest at 10% per annum, was due on December 5, 2017, and is convertible into common shares at a conversion price equal to the lessor of (i) 55% multiplied by the lowest trading price during the previous twenty-five trading day period ending on the latest complete trading day prior to the date of this note and (ii) the alternate conversion price which means 55% multiplied by the lowest trading price during the previous twenty-five trading day period ending on the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. Financing fees on the note were $7,000. The derivative liability applied as a discount on the note was $103,000 and is being accreted over the life of the note.
On January 19, 2018, $50,000 of the note was reassigned to another unrelated note holder and the note was treated as an extinguishment. There were no material changes to the note upon reassignment. Refer to Note 8(o).
On March 2, 2018, $25,000 of the note was reassigned to another unrelated note holder and the note was treated as an extinguishment. There were no material changes to the note upon reassignment. Refer to Note 8(r).
During the six months ended June 30, 2018, the Company issued 206,994,645 common shares with a fair value of $524,487 for the conversion of the remaining principal balance of $35,000, and default penalties and finance costs of $37,448 resulting in a loss on settlement of debt of $452,039.
As at June 30, 2018, the Company has accrued $9,487 in interest and penalties on the note and the fair value of the derivative liability was $13,936 (December 31, 2017 - $188,798).
(h) On July 17, 2017, the Company issued a convertible promissory note in the principal amount of $135,000. The note is unsecured, bears interest at 10% per annum, is due on July 17, 2018, and is convertible into common shares at a conversion price equal to the lessor of (i) 55% multiplied by the lowest trading price during the previous twenty trading day period ending on the latest complete trading day prior to the date of this note and (ii) $0.061. Interest will be accrued and payable at the time of promissory note repayment. Financing fees on the note were $16,500. Derivative liability applied as discount on the note was $118,500 and is being accreted over the life of the note. During the six months ended June 30, 2018, the Company issued 100,000,000 common shares with a fair value of $227,222 for the conversion of $53,530 of principal balance resulting in a loss on settlement of debt of $173,692.
As at June 30, 2018, the carrying value of the note was $81,470 (December 31, 2017 - $70,718) and the fair value of the derivative liability was $138,828 (December 31, 2017 - $205,563). During the six months ended June 30, 2018, the Company accreted $64,282 (2017 - $nil) of the debt discount to interest expense.
(i) On August 17, 2017, the Company issued a convertible promissory note in the principal amount of $110,250. The note is unsecured, bears interest at 8% per annum, is due on August 16, 2018, and is convertible at 58% of to the lowest trading price during the previous ten trading days to the date of a conversion notice. Interest will be accrued and payable at the time of promissory note repayment. Deferred financing fees on the note were $5,250. The derivative liability applied as a discount on the note was $105,000 and is being accreted over the life of the note. During the six months ended June 30, 2018, the Company issued 86,173,799 common shares with a fair value of $293,267 for the conversion of $121,240 of principal and interest resulting in a loss on settlement of debt of 172,027.
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $44,661) and the fair value of the derivative liability was $nil (December 31, 2017 - $166,460). During the six months ended June 30, 2018, the Company accreted $65,589 (2017 - $nil) of the debt discount to finance costs.
(j) On September 6, 2017, the Company issued a convertible promissory note in the principal amount of $107,000. The note is unsecured, bears interest at 10% per annum, is due on March 6, 2018, and is convertible into common shares at a conversion price equal to the lessor of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. Deferred financing fees on the note were $7,000. The derivative liability applied as a discount on the note was $100,000 and is being accreted over the life of the note.
On March 2, 2018, $111,808 of the note was reassigned to another unrelated note holder and the note was treated as an extinguishment. There were no material changes to the terms of the note upon reassignment. Refer to Note 8(s).
13
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $71,088) and the fair value of the derivative liability was $nil (December 31, 2017 - $100,000). During the six months ended June 30, 2018, the Company accreted $35,912 (2017 - $nil) of the debt discount to finance costs.
(k) On October 30, 2017, the Company issued a convertible promissory note in the principal amount of $107,000. The note is unsecured, bears interest at 10% per annum, is due on April 30, 2018, and is convertible into common shares at a conversion price equal to the lessor of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. Deferred financing fees on the note were $7,000. The derivative liability applied as a discount on the note was $100,000 and is being accreted over the life of the note.
On May 22, 2018, the principal balance of $87,045 and accrued interest of $5,543 was reassigned to another unrelated note holder. There were no material changes to the note upon reassignment. Refer to Note 8(y).
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $41,066) and the fair value of the derivative liability was $nil (December 31, 2017 - $100,000). During the six months ended June 30, 2018, the Company accreted $65,934 (2017 - $nil) of the debt discount to finance costs.
(l) On December 18, 2017, the Company issued a convertible promissory note in the principal amount of $82,000. The note is unsecured, bears interest at 10% per annum, is due on June 18, 2018, and is convertible into common shares at a conversion price equal to the lessor of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. Deferred financing fees on the note were $7,000. The derivative liability applied as a discount on the note was $75,000 and is being accreted over the life of the note.
On May 22, 2018, the principal balance of $82,000 and accrued interest of $3,055 was reassigned to another unrelated note holder. There were no material changes to the note upon reassignment. Refer to Note 8(y).
As at June 30, 2018, the carrying value of the note was $nil (December 31, 2017 - $12,357) and the fair value of the derivative liability was $nil (December 31, 2017 - $75,000). During the six months ended June 30, 2018, the Company accreted $69,643 (2017 - $nil) of the debt discount to finance costs.
(m) On January 18, 2018, the Company issued a convertible promissory note in the principal amount of $55,000. The note is unsecured, bears interest at 10% per annum, is due on July 18, 2018, and is convertible into common shares at a conversion price equal to the lessor of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $55,000 and is being accreted over the life of the note.
On June 18, 2018, the principal balance of $55,000 and accrued interest of $2,215 was reassigned to another unrelated note holder. There were no material changes to the note upon reassignment. Refer to Note 8(aa).
As at June 30, 2018, the carrying value of the note was $nil and the fair value of the derivative liability was $nil. During the six months ended June 30, 2018, the Company accreted $49,258 of the debt discount to finance costs.
(n) On January 19, 2018, the Company issued a convertible promissory note in the principal amount of $55,000. The note is unsecured, bears interest at 10% per annum, is due on January 19, 2019, and is convertible into common shares at a conversion price equal to 55% of the lowest trading price during the previous fifteen trading days prior to the conversion date, including the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $55,000 and is being accreted over the life of the note.
As at June 30, 2018, the carrying value of the note was $24,411 and the fair value of the derivative liability was $90,688. During the six months ended June 30, 2018, the Company accreted $24,411 of the debt discount to finance costs.
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(o) On January 19, 2018, the Company issued a convertible promissory note in the principal amount of $50,000, as partial replacement for a convertible promissory note originally issued on June 5, 2017 in the amount of $110,000. Refer to Note 8(g). The note is unsecured, bears interest at 10% per annum, is due on January 19, 2019, and is convertible into common shares at a conversion price equal to 55% of the lowest trading price during the previous fifteen trading days prior to the conversion date, including the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $50,000 and is being accreted over the life of the note. During the six months ended June 30, 2018, the Company issued 57,244,977 common shares with a fair value of $137,143 to convert principal balance of $50,000 and accrued interest of $309 resulting in a loss on settlement of debt of $86,834.
During the six months ended June 30, 2018, the Company accreted $50,000 of the debt discount to finance costs.
(p) On February 2, 2018, the Company issued a convertible promissory note in the principal amount of $107,500. The note is unsecured, bears interest at 10% per annum, is due on August 2, 2018, and is convertible into common shares at a conversion price equal to the lesser of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $107,500 and is being accreted over the life of the note.
On June 18, 2018, the principal balance of $107,500 and accrued interest of $4,005 was reassigned to another unrelated note holder. There were no material changes to the note upon reassignment. Refer to Note 8(aa).
As at June 30, 2018, the carrying value of the note was $nil and the fair value of the derivative liability was $nil. During the six months ended June 30, 2018, the Company accreted $87,418 of the debt discount to finance costs.
(q) On March 2, 2018, the Company issued a convertible promissory note in the principal amount of $128,000. The note is unsecured, bears interest at 10% per annum, is due on March 2, 2019, and is convertible into common shares at a conversion price equal to 55% of the lowest trading price during the previous fifteen trading days prior to the conversion date, including the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $128,000 and is being accreted over the life of the note.
As at June 30, 2018, the carrying value of the note was $42,082 and the fair value of the derivative liability was $210,605. During the six months ended June 30, 2018, the Company accreted $42,082 of the debt discount to finance costs.
(r) On March 2, 2018, the Company issued a convertible promissory note in the principal amount of $25,000, as partial replacement for a convertible promissory note originally issued on June 5, 2017 in the amount of $110,000. Refer to Note 8(g). The note is unsecured, bears interest at 10% per annum, is due on March 2, 2019, and is convertible into common shares at a conversion price equal to 55% of the lowest trading price during the previous fifteen trading days prior to the conversion date, including the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $25,000 and is being accreted over the life of the note. During the six months ended June 30, 2018, the Company issued 45,518,437 common shares with a fair value of $131,335 for the conversion of $25,000 of principal and accrued interest of $35 resulting in a loss on settlement of debt of $106,300.
During the six months ended June 30, 2018, the Company accreted $25,000 of the debt discount to finance costs.
(s) On March 2, 2018, the Company issued a convertible promissory note in the principal amount of $111,808, as partial replacement for a convertible promissory note originally issued on September 6, 2017 in the amount of $107,000 plus accrued interest. Refer to Note 8(j). The note is unsecured, bears interest at 10% per annum, is due on March 2, 2019, and is convertible into common shares at a conversion price equal to 55% of the lowest trading price during the previous fifteen trading days prior to the conversion date, including the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The derivative liability applied as a discount on the note was $25,000 and is being accreted over the life of the note. During the six months ended June 30, 2018, the Company issued 84,783,673 common shares with a fair value of $290,632 for the conversion of $93,400 of principal and $1,054 of accrued interest resulting in a loss on settlement of debt of $196,178.
As at June 30, 2018, the carrying value of the note was $4,985 and the fair value of the derivative liability was $29,902. During the six months ended June 30, 2018, the Company accreted $98,385 of the debt discount to finance costs.
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(t) On March 19, 2018, the Company issued a convertible promissory note in the principal amount of up to $900,000. The note is unsecured, bears interest at 12% per annum, is due on September 19, 2018, and is convertible into common shares after 180 days from issuance date at a conversion price equal to the lessor of: (i) the lowest trading price during the previous fifteen trading days prior to the date of the promissory note; or (ii) 55% of the lowest trading price during the previous fifteen days prior to the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment.
On March 19, 2018, the Company received $270,000 pursuant to the first tranche of the agreement, which is $300,000 in the principal amount, net of the original issuance discount of $30,000. The derivative liability applied as a discount on the note was $300,000 and is being accreted over the life of the note.
As at June 30, 2018, the carrying value of the first tranche of the note was $163,043 and the fair value of the derivative liability was $423,476. During the six months ended June 30, 2018, the Company accreted $163,043 of the debt discount to finance costs.
On May 3, 2018, the Company received $146,500, net of $3,500 in legal fees, pursuant to the second tranche of the agreement, which is $166,667 in the principle amount, net of the original issuance discount of $16,667. The derivative liability applied as a discount on the note was $166,667 and is being accreted over the life of the note.
On May 3, 2018, the Company amended the convertible promissory note to include that at any time after the 100th calendar day after the funds are issued, and at the option of the holder in addition to the right of conversion, the holder may deduct daily payments from the Company’s bank account in the amount of $5,562 per calendar day or $27,812 per week until the Company has paid or the holder has converted an amount equal to the principal balance, interest, accrued interest, and default amount.
As at June 30, 2018, the carrying value of the second tranche of the note was $52,536 and the fair value of the derivative liability was $241,079. During the six months ended June 30, 2018, the Company accreted $52,536 of the debt discount to finance costs.
(u) In January 2018, the Company issued a convertible promissory note in the principal amount of $15,000 as a commitment fee. The note is unsecured, non-interest bearing until default, is due on August 16, 2018, and is convertible into common shares at a conversion price equal to 75% of the average closing trading price during the previous five trading days prior to conversion date, with a minimum of $0.00005. On March 28, 2018, the Company issued 6,230,530 common shares with a fair value of $19,937 for the conversion of $10,000 of principal resulting in a loss on settlement of debt of $9,937.
As at June 30, 2018, the carrying value of the note was $5,000 and the fair value of the derivative liability was $5,364.
(v) As at June 30, 2018, the Company owed a convertible promissory note in the principal amount of $934,939 (Cdn$1,231,128) (December 31, 2017 - $981,370 (Cdn$1,231,128)). The convertible promissory note is unsecured, bears interest at 17.2% per annum, is due on demand, and is convertible into Tags units at the average closing price of the 120 days period prior to conversion date. As at June 30, 2018, accrued interest of $604,452 (Cdn$795,960) (December 31, 2017 – $549,886(Cdn$689,832)) was recorded in accounts payable and accrued liabilities.
(w) On May 8, 2018 the Company issued a convertible note in the principal amount of $51,500. The note is unsecured, bears interest at 10% per annum, and is due on May 8, 2019. The note is convertible into common shares at a 32% discount to the lowest intra-day trading price of the Company’s common stock for the ten trading days immediately preceding the conversion date.
As at June 30, 2018, the carrying value of the note was $9,889 and the fair value of the derivative liability was $65,203. During the six months ended June 30, 2018, the Company accreted $9,889 of the debt discount to finance costs.
(x) On May 28, 2018 the Company issued a convertible note in the principal amount of $180,000. The note is unsecured, bears interest at 10% per annum, and is due on May 8, 2019. The note is convertible into common shares at a 32% discount to the lowest intra-day trading price of the Company’s common stock for the ten trading days immediately preceding the conversion date.
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As at June 30, 2018, the carrying value of the note was $21,522 and the fair value of the derivative liability was $220,004. During the six months ended June 30, 2018, the Company accreted $21,522 of the debt discount to finance costs.
(y) On May 22, 2018 the Company reassigned convertible note balances from another unrelated party in the principal amount of $177,643. Refer to Note 8(k) and 8(l). The note is unsecured, bears interest at 10% per annum, became due and payable on June 18, 2018, and is convertible into common shares at a conversion price equal to the lessor of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. During the six months ended June 30, 2018, the Company issued 163,260,000 common shares with a fair value of $304,554 for the conversion of $146,518 of principal and $817 of accrued interest resulting in a loss on settlement of debt of $157,219.
As at June 30, 2018, the carrying value of the note was $31,125 and the fair value of the derivative liability was $22,996.
(z) On June 1, 2018, the Company reassigned a convertible note from another unrelated party in the principal amount of $105,000; $58,167 in assigned principal and accrued interest and a finance fee of $46,833 Refer to Note 8(e). The note is unsecured, bears interest at 12% per annum, was due on October 18, 2017, and is convertible into common shares at a conversion price equal to the lessor of (i) 60% multiplied by the lowest trading price (representing a discount rate of 40%) during the previous twenty-five trading day period ending on the latest complete trading day prior to the date of the note; and (ii) the variable conversion price which means 50% multiplied by the lowest trading price (representing a discount rate of 50%) during the previous twenty five trading day period ending on the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. During the six months ended June 30, 2018, the Company issued 13,000,000 common shares with a fair value of $26,000 for the conversion of $9,400 of principal and $350 of accrued interest resulting in a loss on settlement of debt of $16,250.
As at June 30, 2018, the carrying value of the note was $95,600 and the fair value of the derivative liability was $126,594.
(aa) On June 18, 2018, the Company reassigned convertible note balances from another unrelated party in the principal amount of $168,721. Refer to Note 8(m) and 8(p). The note is unsecured, bears interest at 10% per annum, which is due on August 2, 2018, and is convertible into common shares at a conversion price equal to the lesser of the lowest trading price during the previous twenty-five trading days prior to: (i) the date of the promissory note; or (ii) the latest complete trading day prior to the conversion date. Interest will be accrued and payable at the time of promissory note repayment. The remaining derivative liability applied as a discount on the reassigned note was $25,824 and is being accreted over the remaining life of the note.
As at June 30, 2018, the carrying value of the note was $142,990 and the fair value of the derivative liability was $124,604. During the six months ended June 30, 2018, the Company accreted $73,669 of the debt discount to finance costs.
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