Subordinated Notes - Related Parties
|3 Months Ended|
Mar. 31, 2019
|Subordinated Notes - Related Parties|
|SUBORDINATED NOTES - RELATED PARTIES||
5 — SUBORDINATED NOTES — RELATED PARTIES
On November 20, 2017, the Company entered into subordinated notes (the “Subordinated Notes”), subordinate to the Senior Secured Bridge Note, with certain insiders, including directors and a consultant, (the “Subordinated Holders”) in the aggregate principal amount of $115,000, of which $100,000 was received as proceeds and $15,000 was recorded as original issue discount. In addition, upon repayment, the Subordinated Holders were to receive a number of warrants to purchase shares of common stock.
On February 22, 2018 the Subordinated Holders settled the Subordinated Notes for newly issued Senior Secured Notes in the principal amount of $100,000, in full and complete satisfaction of the all obligations, including the principal sum of the Subordinated Notes, all accrued and unpaid interest thereon, and warrant issuance obligations. As a result of this settlement, the Company realized a gain of $12,241. As a result of the settlement of these securities for newly issued Secured Notes, no stock or warrants were issued as a result of these provisions of the Subordinated Notes.
For the three months ended March 31, 2018, interest expense on the Subordinated Notes was $8,287.