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Notes Payable
3 Months Ended
Mar. 31, 2015
Notes and Loans Payable [Abstract]  
Notes Payable

Note 8 – Notes Payable

 

On January 22, 2015, the Company entered into a Loan and Security Agreement, pursuant to which Knight Therapeutics (Barbados) Inc. (“Knight”) agreed to loan the Company $6.0 million (the “Loan”), and which amount was borrowed at closing for the purpose of acquiring the Focus Factor Business (see note 1). The Loan bears interest at a rate of 15% per year; provided, however, that upon the occurrence of an equity or convertible equity offering by the Company of at least $1.0 million, the interest rate will drop to 13% per year. Interest accrues quarterly and is payable in arrears on March 31, June 30, September 30 and December 31 in each year, beginning on March 31, 2015. All outstanding principal and accrued and unpaid interest is due on the earliest to occur of either January 20, 2017, or the date that Knight, in its discretion, accelerates the Company’s obligations due to an event of default.

 

In connection with the Loan, the Company issued warrants that were recorded as a debt discount at an initial aggregate value of $3,415,514 (see note 1). The value of these warrants was amortized during the three months ended March 31, 2015, resulting in a final debt discount balance of $1,326,508 as of March 31, 2015.

 

On January 22, 2015, the Company issued a 0% promissory note in a principal amount of $1,500,000 in connection with an Asset Purchase Agreement (see note 1). The note has a maturity date of January 20, 2017, with $750,000 to be paid on or before January 20, 2016 and an additional $750,000 to be paid on or before January 20, 2017.