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Subsequent Events
6 Months Ended
Jun. 30, 2023
Subsequent Events  
Subsequent Events

Note 13. Subsequent Events

 

On July 13, 2023, Donald Reeve, Chairman of the Board, and the Company, entered into a short term note wherein the Company borrowed $40,000 from Mr. Reeve.  Interest will accrue monthly at a rate of 10% per annum.  The note was due in full with interest on August 14, 2023 and has been extended to a new term date of September 13, 2023.  This note remains outstanding as of the filing date.

 

In July 2023, warrants were exercised via a cashless exercise, resulting in 14,567 shares of common stock being issued.

 

On August 7, 2023, the Company received legal notice from a former employee, that he is suing the Company for alleged violations of Oregon labor law, related to his July 2023 termination. The Company believes this lawsuit is without merit and will defend it vigorously.

On August 25, 2023, the Company, as borrower, entered into a business loan arrangement (the “Loan”) with WebBank (the “Lender”). In exchange for the Loan, Lender agreed to lend the Company $150,000.00, with a payment plan of $2,671.15 per week for 78 weeks effective August 28, 2023.  The effective interest rate of the Loan is 46.8%. If Loan is prepaid, the unpaid portion of the finance charge of $58,350 will be due to Lender.

 

On September 14, 2023, the Company, as borrower, entered into a Financing and Security Agreement ("Agreement") with Celtic Bank Corporation (the “Celtic”). In exchange for a line of credit (“LOC”), Celtic agreed to lend the Company $200,000.00, with a payment plan of $20,892.15 per month for 12 months effective October 16, 2023.  The annual percentage rate of the LOC is 48.4%, If LOC is prepaid, the unpaid interest accrued will be due to Celtic.  If an additional draw on the LOC is requested, a draw fee will be imposed.

 

On October 13, 2023, the Company received funding from a loan agreement with Stripe and Celtic Bank.  The loan amount was $140,200 plus a fixed fee of $16,403. The repayment amount of $156,603 will be repaid at a repayment rate of 20% of the Company’s receivables automatically withheld by Stripe.  There is no financing percentage.  The repayment start date is October 19, 2023, with a minimum payment amount of $17,400 over every 60-day period. The final repayment date is April 25, 2025, if total repayment amount is not paid as of that date.  This loan agreement also eliminates the remaining balance of $35,754 from the previous Stripe loan dated March 16, 2023, as the remaining balance was rolled into this new loan.