Quarterly report pursuant to Section 13 or 15(d)

Subsequent Events

v3.20.2
Subsequent Events
6 Months Ended
Jun. 30, 2020
Subsequent Events  
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:

 

 

·

Noteholders representing $2,197,745 of such principal amount, (and approximately $38,400 of accrued interest) exchanged into new convertible promissory notes with a maturity date of February 11, 2022. Pursuant to the terms of the issuance agreements, the noteholders were also issued 3,354,218 common shares of the Company in connection with the issuance of the new notes.  Immediately thereafter, the noteholders converted the entire principal amount due under the notes into common shares of the Company at $0.15 per share pursuant to the terms of the new convertible notes, and were issued 14,907,633 common shares of the Company in the conversions.

 

 

·

 Noteholders representing $2,453,150 of such principal amount exchanged into new convertible promissory notes with a maturity date of February 11, 2022, and were issued 3,679,725 common shares of the Company in connection with the issuance of the new notes.

 

 

 

 

·

Noteholders representing $6,301,020 of such principal amount agreed to extend the maturity date of their convertible promissory notes from August 31, 2020 to December 31, 2020.

  

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.