| Notes Payable Disclosure | (6) Notes Payable As of June 30, 2019 and March 31, 2019, the Company had the following long-term and short-term debt obligations: June 30, March 31, 2019 2019 Convertible promissory notes issued to former owners in acquisition of Power Blockchain, accruing interest at 5% per annum, principal repayments due in four equal installments on 2nd, 3rd, 4th and 5th anniversaries, convertible into common stock at $0.13 per share. $ 2,200,000 $ 2,200,000 Other short term notes issued to various affiliates of the former owners of Power Blockchain for acqusition of Treasury Stock, computers and equipment, and working capital financing, at stated interest rates of 10%. 749,035 741,035 Long term debt, net of current portion $ 2,949,035 $ 2,941,035 The Company performed an analysis of the convertible notes payable in the amount of $2,200,000 to determine whether there was a beneficial conversion feature and noted none. Future maturities of notes payable as of June 30, 2019 are as follows: Year ending June 30, 2020 $ 749,035 Year ending June 30, 2021 550,000 Year ending June 30, 2022 550,000 Year ending June 30, 2023 550,000 Year ending June 30, 2024 550,000 $ 2,949,035 At the time of the Power Blockchain acquisition, Power Blockchain had outstanding unsecured notes payable to the two owners in the amount of $570,000, which were overdue and in default. Shortly thereafter, the Company entered into negotiations with the note holders in an attempt to settle these obligations. As a result of those efforts, a settlement agreement was reached in March 2018 to convert the notes payable into the right for the two note holders (the Plaintiffs) in an attempt to settle these obligations. As a result of those efforts, a settlement agreement was reached in March 2018 to convert the notes payable into the right for the two note holders to receive periodic issuances of the Companys common stock of up to approximately 3,000,000 shares each, that would be exempted from registration pursuant to Section 3(a)(10) of the Securities Act of 1933. The settlement agreement stipulated that the issuance of such shares shall occur in respective tranches such that the resulting number of shares owned by each holder would not exceed 4.9% of the Companys then outstanding shares of common stock. Per the settlement agreement, the Plaintiffs right to make requests for periodic tranche issuances shall expire on September 17, 2019. Thereafter, the Company shall have no obligation to issue shares to either Plaintiff. In the agreement the Plaintiffs acknowledged that they may be unable to sell, prior to the expiration of their right to make requests for periodic tranche issuances, a sufficient number of shares to recoup the debt and they expressly assumed that risk. As at the date of settlement it was not known if any shares would be requested to be issued prior to the expiration date, and the Plaintiffs accepted risk, the Company could not estimate an amount of shares to be issued, and therefore no amount was recognized for the settlement. To date, no such shares have been issued. |
