NOTES PAYABLE |
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NOTES PAYABLE | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOTE 14 - NOTES PAYABLE | NOTE 14 – NOTES PAYABLE
Notes payable consist of the following at June 30, 2022 and December 31, 2021 (in thousands):
On May 18, 2020 and August 12, 2020, the Company entered into unsecured promissory notes (the “ Notes”) with an investor for $0.3 million and $0.5 million, respectively. The Notes were due on May 18, 2021 and August 12, 2021, respectively, and have an interest rate of 8% per annum, payable in quarterly payments. The principal and accrued interest under the Notes can convert into convertible promissory notes if the Company consummates a debt financing for the sale and issuance of promissory notes that are convertible into common stock of the Company on terms that are more favorable to new investors than the terms described in the term sheet included in the Notes. Upon notice by the Company of such debt financing, the holder of the Notes shall have the right, but not the obligation, to convert the Notes into convertible promissory notes, with the same principal amount and interest accruing from the date of issuance of the Notes, on the same terms as the convertible promissory notes issued to such new investors. On October 30, 2021, both the Company and the investor agreed to roll the amount of principal and accrued interest as of October 30, 2021 into new secured promissory notes (“New August & May Notes”) with a new principal amount of $0.3 million and $0.5 million. The New August & May Notes are due on June 15, 2022 and has an interest rate of 10% per annum, payable at maturity. The New August & May Notes are secured by all the Company’s personal property. Subsequent to June 30, 2022, the New August & May Notes were paid. See Note 22 – Subsequent Events for additional information.
On January 13, 2021 and February 25, 2021, the Company received a total of $0.5 million from an investment company in exchange for a promissory note. At the time the Company received the $0.5 million, terms of promissory note were not yet finalized. On October 30, 2021, both the Company and the investment company agreed to roll the amount of principal and accrued interest as of October 30, 2021 into a new secured promissory note (“New January 2021 Note”) with a principal amount of $0.5 million. The New January 2021 Note is due on June 15, 2022 and has an interest rate of 10% per annum, payable at maturity. The New January 2021 Note is secured by all the Company’s personal property. Subsequent to June 30, 2022, the New January 2021 Note was paid. See Note 22 – Subsequent Events for additional information.
On April 8, 2021 and September 24, 2021, the Company received $0.3 million and $0.3 million, respectively, from an investment company in exchange for two promissory notes. At the time the Company received the total amount of $0.5 million, terms of promissory notes were not yet finalized. On October 30, 2021, both the Company and the investment company agreed to roll the amount of principal and accrued interest as of October 30, 2021 into new secured promissory notes (“New April & September 2021 Notes”) with principal amounts of $0.3 million and $0.3 million. The New April & September 2021 Notes are due on June 15, 2022 and has an interest rate of 10% per annum, payable at maturity. The New April & September 2021 Notes are secured by all the Company’s personal property. Subsequent to June 30, 2022, the New April & September 2021 Notes were paid. See Note 22 – Subsequent Events for additional information. On October 27, 2021, the Company received $0.3 million from an investment company in exchange for a secured promissory note (“October 2021 Note”). The October 2021 Note is due on May 31, 2022 and has an interest rate of 10% per annum, payable at maturity. The October 2021 Note is secured by all the Company’s personal property. As of the filing date of this Quarterly Report, the Company and the investment company are negotiating the terms to extend the October 2021 Note.
On November 18, 2021, the Company received $0.1 million from an investment company in exchange for a secured promissory note (“November 2021 Note”). The November 2021 Note is due on May 31, 2022 and has an interest rate of 10% per annum, payable at maturity. The November 2021 Note is secured by all the Company’s personal property. As of the filing date of this Quarterly Report, the Company and the investment company are negotiating the terms to extend the November 2021 Note.
From October 15, 2021 to December 15, 2021, the Company received at total of $0.4 million from an investment company in exchange for promissory notes. Both the Company and the investment company agreed to negotiate the terms of the promissory notes and as of the filing date of this Quarterly Report, the Company and the investment company are still negotiating the terms of the promissory notes.
On December 16, 2021, the Company received at total of $0.2 million from an investment company in exchange for secured promissory note (“December 2021 Note”). The December 2021 Note is due on June 15, 2022 and has an interest rate of 10% per annum, payable at maturity. The December 2021 Note is secured by all the Company’s personal property. Subsequent to June 30, 2022, the December 2021 Note was paid. See Note 22 – Subsequent Events for additional information.
On January 18, 2022, the Company received $0.2 million from an investment company in exchange for a secured promissory note (“January 2022 Note”). The January 2022 Note is due on June 30, 2022 and has an interest rate of 10% per annum, payable at maturity. The January 2022 Note is secured by all the Company’s personal property. As of the filing date of this Quarterly Report, the Company and the investment company are negotiating the terms to extend the January 2022 Note.
Interest expense for the three months ended June 30, 2022 and 2021 was $0.1 million and $0.1 million, respectively. Interest expense for the six months ended June 30, 2022 and 2021 was $0.2 million and $0.1 million, respectively. |