Accrued Payroll – Related Parties

Included in other accrued expenses on the accompanying consolidated balance sheet as of March 31, 2020 and 2019 is approximately $176,000 and $217,000 owing to the former Chief Executive Officer of the Company, approximately $84,000 and $69,000 owing to the President and current Chief Executive Officer of the Company, and approximately $166,000 and $96,000 (which includes $50,000 in both fiscal years, from consulting services prior to his employment) owing to the Chief Operating Officer, respectively. These amounts include both accrued payroll and accrued allowances and expenses.

Notes Payable – Related Parties

On April 20, 2017, the Company entered into a convertible debenture with an affiliate of the Company whose managing member is the Treasurer, Chief Financial Officer, and a director of the Company (the “affiliate”), for $140,000. The convertible debenture matures one year from date of issuance, and bears interest at 6%. Upon an event of default, as defined in the debenture, the principal and any accrued interest becomes immediately due, and the interest rate increases to 24%. The convertible debenture is convertible at the holder’s option at a conversion price of $0.30.

During the year ending March 31, 2019, the Company had paid $52,400 on this note, with $87,600 remaining outstanding as of March 31, 2019. During the year ending March 31, 2020, on three separate dates, the Company paid the remaining balance in full.

NaturalShrimp Holdings, Inc.

On January 1, 2016 the Company entered into a notes payable agreement with NaturalShrimp Holdings, Inc.(“NSH”), a shareholder. Between January 16, 2016 and March 7, 2016, the Company borrowed $134,750 under this agreement. An additional $601,361 was borrowed under this agreement in the year ended March 31, 2017. The note payable has no set monthly payment or maturity date with a stated interest rate of 2%. As of March 31, 2020 and March 31, 2019 the outstanding balance is approximately $735,000. At March 31, 2020 and March 31, 2019, accrued interest payable was $21,570 and $36,174, respectively.

Shareholder Notes

The Company has entered into several working capital notes payable to multiple shareholders of NSH and Bill Williams, an officer, a director, and a shareholder of the Company, for a total of $486,500. The notes are unsecured and bear interest at 8%. These notes have no set monthly payment or maturity date. The balance of these notes at both March 31, 2020 and March 31, 2019 was $426,404, and is classified as a current liability on the consolidated balance sheets. At March 31, 2020 and March 31, 2019, accrued interest payable was $275,054 and $266,616, respectively..

Shareholders

In 2009, the Company entered into a note payable to Randall Steele, a shareholder of NSH, for $50,000. The note bears interest at 6.0% and was payable upon maturity on January 20, 2011, and was in default. The note is unsecured. On January 22, 2020, the Company paid the note payable in full.

Beginning in 2010, the Company started entering into several working capital notes payable with various shareholders of NSH for a total of $290,000 and bearing interest at 8%. The balance of these notes at March 31, 2020 and March 31, 2019 was $54,647 and is classified as a current liability on the consolidated balance sheets.