NOTE 15 - RELATED PARTY TRANSACTIONS

Alchemist Holdings, LLC

In connection with the Company’s acquisition of Total Travel Media, Inc. in May 2017, the Company issued 7,500,000 shares of its Series B preferred stock and 7,500,000 shares of its Class B common stock to Alchemist Holdings, LLC (“Alchemist”), an entity which was under the operational control of the then Chairman of our Board of Directors. In connection with the Company’s acquisition of Four Oceans Holdings, Inc. in September 2017, the Company issued 50,000,000 shares of its Series A preferred stock to Alchemist. Such shares of Series A preferred stock have since been converted to shares of the Company’s Class A common stock. The information contained in Note 1 of Notes to the Consolidated Financial Statements located in ITEM 8 – Financial Statements and Supplementary Data in our Annual Report on Form 10-K for the fiscal year ended April 30, 2019 is incorporated herein by reference.

Bear Bull Market Dividends, Inc.

In connection with the Company’s acquisition of Total Travel Media, Inc., the Company issued 2,500,000 shares of its Series B preferred stock and 2,500,000 shares of its Class B common stock to Bear Bull Market Dividends, Inc. In connection with the Company’s acquisition of Four Oceans Holdings, Inc., the Company issued 20,000,000 shares of its Series A preferred stock to Bear Bull Market Dividends, Inc.

Related Party Sublease

The Company subleases warehouse and office space from Alchemist. During the fiscal years ended April 30, 2020 and 2019, rent expense associated with such sublease agreement was $91,980 and $8,184, respectively.

Accounts Receivable, Related Party

As disclosed earlier, in January 2019, the Company became aware of an unliquidated amount of potential liability arising from a series of cash advance loan transactions (the “Loan Transactions”) entered into by eight different lending sources and a Related Party entity (the “debtor entity”) at the time owned and/or controlled by a former Company officer. Without the knowledge of the Company and in contravention of the express provisions of both the Company’s Bylaws and the controlling Nevada Revised Statutes, this former officer also purported to obligate the Company (and two of the Company’s affiliates) to repay the amounts owed by the debtor entities under the Loan Transactions. The Company has settled all the debt associated with the Loan Transactions at a substantial discount from the amounts alleged by the holders of such debt. Additionally, in February 2019, the Company, the debtor entity, and the former Company officer entered into a comprehensive Settlement Agreement (the “February 2019 Settlement Agreement”), secured by substantial assets, pursuant to which the debtor entity and the former Company officer became obligated jointly and severally to repay the Company the sums expended by the Company in the resolution of the Loan Transactions. The Company had recorded an accounts receivable of $3.4 million from the debtor entity and the former Company officer in connection therewith. This amount was reported in accounts receivable, related party in our consolidated balance sheets.

In February 2020, the Company, the debtor entity, and the former Company officer entered into a Settlement Accommodation Agreement (the “Accommodation Agreement”) pursuant to which the debtor entity and the former Company officer agreed to transfer to the Company 22,683,864 shares of the Company’s common stock held by the debtor entity, in settlement of the obligations to the Company under the February 2019 Settlement Agreement. In addition, the Company, the debtor entity, and the former Company officer entered into a Securities Escrow Agreement (the “Escrow Agreement”). Under the terms of the Escrow Agreement, the Company acquired control of the 22,683,864 shares of the Company’s common stock to be transferred to the Company, which shares are to be transferred to the Company at a time that the Company, in its sole discretion, decides. In connection with Accommodation Agreement and Escrow Agreement, the Company recognized a deemed dividend in the amount of $2.6 million for the difference between the fair value of the 22,683,864 shares of the Company’s common stock on the effective date of such agreements, and the accounts receivable settled.

Under the terms of the Accommodation Agreement discussed in the preceding paragraph, the Company will also receive 15,625,000 shares of its common stock to offset certain legal and other expenses incurred by the Company in connection with various related-party legal claims. Under the terms of the Escrow Agreement discussed in the preceding paragraph, such shares are to be transferred to the Company at a time that the Company, in its sole discretion, decides. The Company has recognized a deemed dividend in the amount of $937,500 for the difference between the fair value of such 15,625,000 shares of the Company’s common stock and the settlement amount. In addition, under the terms of the Accommodation Agreement, the Company awarded to the debtor entity, a put option to sell to the Company up to 5.0 million shares of the Company’s common stock held by the debtor entity at $0.10 per share, subject to certain conditions. In connection therewith, the Company recorded a deemed dividend in the amount of $177,880 for the fair value of the put option.

See Note 17 – “Commitments and Contingencies” below for more information about our related parties.