SCHEDULE OF NOTES PAYABLE |
The
following table summarizes the Company’s notes payable:
SCHEDULE OF NOTES PAYABLE
|
|
Interest
rate |
|
|
Date
of maturity |
|
|
March
31, 2021 |
|
|
December
31, 2020 |
|
Truck
loan (i) |
|
|
5 |
% |
|
|
January
20, 2022 |
|
|
$ |
7,990 |
|
|
$ |
9,916 |
|
Credit
note I (ii) |
|
|
12 |
% |
|
|
May
11, 2021 |
|
|
|
— |
|
|
|
800,000 |
|
Credit
note II (iii) |
|
|
12 |
% |
|
|
October
17, 2019 |
|
|
|
— |
|
|
|
346,038 |
|
Credit
note III (iv) |
|
|
15 |
% |
|
|
April
25, 2021 |
|
|
|
— |
|
|
|
750,000 |
|
Discount
on credit note III |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,976 |
) |
Credit
note IV(v) |
|
|
10 |
% |
|
|
June
30, 2021 |
|
|
|
933,095 |
|
|
|
937,109 |
|
Discount
on credit note IV |
|
|
— |
|
|
|
— |
|
|
|
(238,577 |
) |
|
|
(285,768 |
) |
Credit
note V(vi) |
|
|
10 |
% |
|
|
December
31, 2021 |
|
|
|
918,049 |
|
|
|
— |
|
Discount
on credit note V |
|
|
— |
|
|
|
— |
|
|
|
(1,195 |
) |
|
|
— |
|
Credit
note VI (vii) |
|
|
10 |
% |
|
|
December
31, 2021 |
|
|
|
1,133,104 |
|
|
|
— |
|
Lee
Lytton |
|
|
— |
|
|
|
On
demand |
|
|
|
3,500 |
|
|
|
3,500 |
|
Joel
Oppenheim (viii) |
|
|
10 |
% |
|
|
On
demand |
|
|
|
— |
|
|
|
161,900 |
|
Joel
Oppenheim (viii) |
|
|
10 |
% |
|
|
On
demand |
|
|
|
— |
|
|
|
15,000 |
|
Joel
Oppenheim(viii) |
|
|
10 |
% |
|
|
October
17, 2018 |
|
|
|
— |
|
|
|
240,000 |
|
Credit
Note VII (viii) |
|
|
10 |
% |
|
|
December
31, 2021 |
|
|
|
416,900 |
|
|
|
— |
|
Origin
Bank (PPP loan) (ix) |
|
|
— |
|
|
|
— |
|
|
|
56,680 |
|
|
|
56,680 |
|
M.
Horowitz |
|
|
10 |
% |
|
|
October
14, 2016 |
|
|
|
10,000 |
|
|
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
$ |
3,239,546 |
|
|
$ |
3,038,309 |
|
Current
portion: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Truck
loan |
|
|
|
|
|
|
|
|
|
$ |
7,990 |
|
|
$ |
9,343 |
|
Credit
note I |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
800,000 |
|
Credit
note II |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
346,038 |
|
Credit
note III |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
744,023 |
|
Credit
note IV |
|
|
|
|
|
|
|
|
|
|
694,518 |
|
|
|
651,251 |
|
Credit
note V |
|
|
|
|
|
|
|
|
|
|
916,854 |
|
|
|
— |
|
Credit
note VII |
|
|
|
|
|
|
|
|
|
|
1,133,104 |
|
|
|
— |
|
Lee
Lytton |
|
|
|
|
|
|
|
|
|
|
3,500 |
|
|
|
3,500 |
|
Joel
Oppenheim |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
161,900 |
|
Joel
Oppenheim |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
15,000 |
|
Joel
Oppenheim |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
240,000 |
|
Credit
note VII |
|
|
|
|
|
|
|
|
|
|
416,900 |
|
|
|
— |
|
Origin
Bank (PPP loan) |
|
|
|
|
|
|
|
|
|
|
56,680 |
|
|
|
56,680 |
|
M.
Horowitz |
|
|
|
|
|
|
|
|
|
|
10,000 |
|
|
|
10,000 |
|
Current
portion of notes payable |
|
|
|
|
|
|
|
|
|
$ |
3,239,546 |
|
|
$ |
3,037,737 |
|
|
(i) |
On
January 6, 2017, the Company purchased a truck and entered into an installment note in the amount of $35,677 for a term of five years
and interest at 5.49% per annum. Payments of principal and interest in the amount of $683 are due monthly. |
|
(ii) |
On
May 9, 2018, Bow entered into an Amended and Restated Loan Agreement with a third party. The Loan Agreement increased by $800,000
the amount of a previous loan agreement entered into between Bow and the Lender, to $1,530,000. The amount owed under the Loan Agreement
accrues interest at the rate of 12% per annum (19% upon the occurrence of an event of default) and is due and payable on May 11,
2021, provided that the amount owed can be prepaid prior to maturity, beginning 60 days after the date of the Loan Agreement, provided
that the Company gives the Lender 10 days’ notice of our intent to repay and pays the Lender the interest which would have
been due through the maturity date at the time of repayment. The Loan Agreement contains standard and customary events of default,
including cross defaults under other indebtedness obligations of us and Bow, and the occurrence of any event which would have a material
adverse effect on us or Bow. The Company is required to make principal payments of $10,000 per month from January through September
2019 with the remaining balance of $710,000 due at maturity on May 11, 2021. The additional $800,000 borrowed in connection with
the entry into the Loan Agreement was used by the Company to acquire a 25% working interest in approximately 41,526 acres located
in the Luseland, Hearts Hill, and Cuthbert fields, located in Southwest Saskatchewan and Eastern Alberta, Canada (collectively, the
“Canadian Properties” and the “Working Interest”). Upon the disposition of Bow, a total of $730,000 of the
obligations owed under the Loan Agreement were transferred to Blue Sky Resources Ltd. (“Blue Sky”). |
|
|
|
|
|
In
order to induce the Lender to enter into the Loan Agreement, the Company agreed to issue the Lender 500,000 shares of restricted
common stock (the “Loan Shares”), which were issued on May 18, 2018, and warrants to purchase 2,320,000 shares of common
stock (the “Loan Warrants”), of which warrants to purchase (a) 320,000 shares of common stock have an exercise price
of $0.10 per share in Canadian dollars and expire in May 15, 2021, (b) 500,000 shares of common stock have an exercise price of $0.12
per share in U.S. dollars, and expire on May 15, 2021; and (c) 1,500,000 shares of common stock have an exercise price of $0.10 per
share in U.S. dollars and expire on May 15, 2020. The fair value of the 500,000 common shares issued were assessed at the market
price of the stock on the date of issuance and valued at $47,500. The fair value of the Canadian dollar denominated warrants issued
were assessed at $30,012 using the Black Scholes Option Pricing Model. The fair value of the U.S. dollar denominated warrants issued
were assessed at $182,650 using the Black Scholes Option Pricing Model. The Company determined the debt modification to be an extinguishment
of debt and recorded a total loss on extinguishment of debt of $260,162. |
|
|
|
|
|
On
January 1, 2021, the Lender signed an amended loan agreement, which moved the balance of this note to credit note VI. More details
can be found in footnote (vii). |
|
|
|
|
(iii) |
On
September 17, 2018, the Company entered into a loan agreement with a third party for $200,000
to acquire an additional
3%
working interest in the Canadian Properties. The loan bears interest at 12%
per annum and has a maturity date of October 17, 2019. Payments of principal and interest in the amount of $6,000
are due monthly. The loan
is secured against the Company’s 3%
working interest in the Canadian Properties and has no financial covenants. During 2020, the LOC balance increased by $146,000
resulting in a $346,038
ending balance. On January
1, 2021, the Lender signed an amended loan agreement, which moved the balance of this note to credit note VI. More details can be
found in footnote (vi) and (vii). |
|
|
|
|
(iv) |
On
April 25, 2019, the Company entered into a promissory note (an “Acquisition Note”) with a third-party in the amount of
$750,000
to acquire working interests in the Utikuma oil
field in Alberta Canada. The Note bears interest at 9%
per annum and is due in full at maturity on April
25, 2021. No payments are required on the
note until maturity while interest is accrued. In addition, warrants to purchase 500,000
shares of common stock with an exercise price
of $0.12
per share expiring on May 1, 2021, were issued
associated with the note. The fair value of issued warrants were recorded as a debt discount of $38,249
and amortization of $8,366.
The notes hold a security guarantee of working interest in the Utikuma oil field and a working
interest in the TLSAU field. On January 1, 2021, the Lender signed an amended loan agreement, which moved the balance of this note
to credit note V. More details can be found in footnote (vi). |
|
|
|
|
(v) |
On
January 2, 2020, the Company entered into a loan agreement in the amount of $1,000,000 with a third party (including a $120,000 origination
fee). The note bore interest at an interest rate of $10% per annum and matures on June 30, 2020, with warrants to purchase 5,000,000
shares of common stock (the “Loan Warrants”), at an exercise price of $0.10 per share in Canadian dollars and expire
on January 2, 2023. The fair value of issued warrants were recorded as a debt discount of $266,674 and monthly amortization of $11,111.
These funds were initially placed in escrow, then on May 29, 2020, they were used for the purchase of the Utikuma oil field. Pursuant
to a loan extension agreement, on October 30, 2020, the Company issued warrants to purchase 5,000,000 of common stock, at an exercise
price of $0.05 per share, expiring on January 6, 2023. The fair value of the issued warrants was recorded as a debt discount of $166,289
and monthly amortization of $4,614.14. |
|
|
|
|
(vi) |
On
January 1, 2021, the Company signed an amended loan agreement with a third party for $918,049,
which combined credit note III along with $146,038
of credit note II and
accrued interest on those amounts. The loan bears interest at 10%
per annum and has a maturity date of December 31, 2021. The warrants associated with credit note III are applied as a discount to
the amended loan. The note holds a security guarantee of a working interest in the Utikuma oil field and a working interest in the
TLSAU field. This modification created a gain of $77,576, which was recorded in additional paid in capital, due to the related
party nature of the transaction. |
|
|
|
|
(vii) |
On
January 1, 2021, the Company signed an amended loan agreement with a third party for $1,133,104,
which combined credit note I along with $200,000
of credit note II and
accrued interest on those amounts. The loan bears interest at 10%
per annum and has a maturity date of December 31, 2021. The note holds a security interest against the 25%
Working Interest in the Cona assets. This modification created a gain of $104,235, which was recorded in additional paid in capital,
due to the related party nature of the transaction. |
|
|
|
|
(viii) |
Various
Shareholder Advances provided by Mr. Oppenheim during 2018 and 2019. There were no formal documents drawn. Interest rates were applied
based on other similar loan agreements entered into by the Company during that period. On February 12, 2021, the Company entered
into an amended loan agreement in the amount of $416,900 that consolidated these amounts. The loan bears interest at 10% per annum
and has a maturity date of December 31, 2021. |
|
|
|
|
(ix) |
On
April 23, 2020, the Company was granted a $56,680
business loan through the
Paycheck Protection Program (PPP) administered through the CARES act. The loan amount was based 2.5 times the Company’s average
monthly payroll costs. The company applied for loan forgiveness, and it was granted on July 26, 2021.. |
|