|6 Months Ended|
Jun. 30, 2020
|Note 9. Subsequent events||
In early July 2020, the Company issued a Promissory Note to Radium 2 Capital, Inc. (“Radium” a related party through affiliation with Troy Caruso), in connection with $1,350,000 advanced by Radium to the Company. The Promissory Note permitted Radium to convert all or a portion of the amount owing into common shares of the Company at a conversion price of $0.122 per share. Subsequently in July 2020, Radium elected to convert the entire principal amount and the Company issued Radium 11,065,574 common shares in the conversion.
Additionally, in early July 2020, the Company issued an investor a convertible promissory note in the principal amount of $500,000 and 1,600,000 shares of the Company’s common stock. The note matures on the earlier of (i) 180 days after the date of the note, or (ii) the completion of the Company’s up-listing to a national stock exchange, whether via merger or otherwise, if repayment of the note is required by a third party; the note accrues interest at 12% per annum, with interest due at maturity; and the note is convertible into shares of the Company’s common stock at a fixed conversion price of $0.15, subject to a 4.99% waivable beneficial ownership limitation.
From July 1, 2020 to August 14, 2020, the Company had the following activity regarding the 2018 Convertible Notes:
In a series of separate transactions subsequent to June 30, 2020, the Company issued, in the aggregate, 15,154,811 shares of common stock in exchange for services rendered by several parties.
In a series of separate transactions subsequent to June 30, 2010, the Company issued in the aggregate 610,972 shares of common stock to various noteholders as payment for interest.
On or about July 7, 2020, an individual holder of a $25,000 promissory note exchanged into a new convertible promissory note with a maturity date of February 11, 2022, and was also issued 37,500 common shares of the Company in connection with the issuance of the new note. Immediately thereafter, the noteholder converted the entire principal amount into common shares of the Company at $0.15 per share and was issued 166,667 common shares of the Company in the conversion.
On or about July 31, 2020, the Company issued 7,125 shares of common stock pursuant to a cashless exercise of warrants.
On or about July 31, 2020, the Company issued for services common stock warrants to purchase 2,500,000 shares of common stock at a price equal to $0.001 per share. The warrants have a five-year term and include a cashless exercise feature.
As discussed in Note 7, the February 3, 2020 loan agreement with various lenders in the initial amount of $36,458,333 required the Elysium subsidiaries to maintain certain financial ratios regarding collateral coverage and maximum leverage, and on August 19, 2020, the lenders waived any defaults at June 30, 2020, relating to those financial ratios in consideration of the Elysium subsidiaries agreeing to pay the lenders $87,000.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef