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RELATED PARTY TRANSACTIONS
3 Months Ended
Dec. 31, 2014
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

On December 31, 2014, Stratean Inc. (the "Company") and two Promissory Note holders, Burkeley J. Priest ("Priest") and The Munson Family Limited Partnership ("Munson") entered into Debt Settlement Agreements ("Agreements"), to settle two Promissory Notes ("Notes") with a face value of $33,341 and $16,659, respectively. Priest and Munson agreed that, upon execution of their agreements and receipt of the stock, all claims of Priest and Munson against Stratean Inc., were deemed released.

 

Pursuant to the Agreements the Company issued Priest 38,342 shares of Stratean Inc. $0.001 par value common stock which had a fair value on December 31, 2014 of approximately $1.00 per share, or $38,342. On the date of the transaction Burkeley J. Priest owned approximately 6.2% of the Company's outstanding common stock and is considered a related party, therefore in accordance with ASC 470-50 approximately $5,001 will be recorded as a charge against additional paid in capital as a result of the Agreement.

 

Pursuant to the Agreements the Company issued Munson 19,158 shares of Stratean Inc. $0.001 par value common stock which had a fair value on December 31, 2014 of approximately $1.00 per share, or $19,158. On the date of the transaction The Munson Family Limited Partnership owned approximately 7.5% of the Company's outstanding common stock and is considered a related party, therefore in accordance with ASC 470-50 approximately $2,499 will be recorded as a charge against additional paid in capital as a result of the Agreement.

 

Pursuant to the Agreements Priest has been granted a 10 year royalty ("Royalty") of one-half of one percent (.5%) of "Gross Revenues" derived from the "Sale of Stratean Downdraft Gasifer units".

 

Pursuant to the Agreements Munson has been granted a 10 year royalty ("Royalty") of one-quarter of one percent (.25%) of "Gross Revenues" derived from the "Sale of Stratean Downdraft Gasifer units".

 

The Agreements define 'Gross Revenues' as; monies actually received by Stratean arising from the sale of its units. The Agreement further defines the 'Sale of Stratean Gasifier Units' as revenues received by Stratean as a direct result and occurrence of a sale of physical gasifier units to third parties. All other revenues generated by Stratean whether related to the Company's Gasifier or otherwise are explicitly excluded. Under this agreement Stratean is required to render statements and make payments to Priest and Munson within 60 days after the last day of each fiscal quarter.

 

Stratean remains free to exercise all the rights of ownership of its property and intellectual property including the right to sell its intellectual property and make licensing and sub-license agreements without consulting Priest or Munson and upon whatever terms it deems wise.