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Notes Receivable | 3 Months Ended
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Mar. 31, 2022
Receivables [Abstract] |
Notes Receivable | 3. Notes Receivable American Premium Water Corporation On October 15, 2020, APB entered into a loan agreement with (“APW Note”) with American Premium Water Corporation,(“APW”), a Nevada corporation. The loan, not to exceed the principal sum of $200,000, has an interest rate of 12%, and matures on October 15, 2022. The outstanding principal and interest as of March 31, 2022 and December 31, 2021, approximated $39,000 and is classified as a Current portion of notes receivable on the Consolidated Balance Sheets at March 31, 2022 and December 31, 2021. GSX repaid the principal and interest in full in April 2022. GSX Group Limited On February 8, 2021, the Company entered into a convertible promissory note (“GSX Note”) with GSX Group Limited (“GSX”), a company registered in Gibraltar. The Company loaned the principal sum of $800,000, with principal and interest at a rate of 4%, due in one year from date of issuance. The outstanding principal and interest as of March 31, 2022 and December 31, 2021, approximated $837,000 and $829,000, respectively, and is classified as a Current portion of notes receivable on the Consolidated Balance Sheets at December 31, 2021. GSX repaid the principal and interest in full in April 2022. On February 3, 2021, USX Holdings Company, Inc., a subsidiary of the Company entered into a binding joint venture term sheet (“GSX JV”), along with Coinstreet, whose CEO is also a member of the Company’s board of directors, for the creation of a USA based joint venture alternative trading system or exchange (“JV Exchange”). During the nine-months ended September 30, 2021, the Company and GSX finalized the terms of the JV Exchange. This JV is currently in the planning stages. Dustin Crum On February 21, 2021, Impact BioMedical, Inc. a subsidiary of the Company, entered into a promissory note (“Crum Note”) with Dustin Crum (“Mr. Crum”). The Company loaned the principal sum of $206,000, with interest at a rate of 6.5%, and maturity date of August 19, 2022. Monthly payments are due on the twenty-first day of each month and continuing each month thereafter until August 19, 2022, at which time all accrued interest and the entire remaining principal shall be due and payable in full. This note is secured by certain real property situated in Collier County, Florida. The outstanding principal and interest as of March 31, 2022, approximated $207,000 and is classified in current notes receivable on the accompanying consolidated balance sheets. Sentinel Brokers Company, Inc. On May 13, 2021, Sentinel Brokers, LLC, a subsidiary of the Company entered a revolving credit promissory note (“Sentinel Note”) with Sentinel Brokers Company, Inc. (“Sentinel”), a company registered in the state of New York. The Sentinel Note has an aggregate principal balance up to $600,000, to be funded at request of Sentinel. The Sentinel Note, which incurs interest at a rate of 6.65% is payable in areas until the principal is paid in full at the maturity date of May 13, 2023. As of March 31, 2022 and December 31, 2021, there was $151,000 and $0, respectively, outstanding on the Sentinel Note, and is included in current notes receivable on the accompanying consolidated balance sheet. Also on May 13, 2021, the Company entered into a stock purchase agreement (“Sentinel Agreement”) to acquire a 24.9% equity position of Sentinel for the purchase price of $300,000. During April 2022, the Sentinel Note was amended to increase the available revolving credit principal to $3,000,000. See Note 6. Puradigm, LLC On May 14, 2021, DSS Pure Air, Inc. a subsidiary of the Company entered into a convertible promissory note (“Puradigm Note”) with Puradigm, LLC (“Puradigm”), a company registered in the state of Texas. The Puradigm Note has an aggregate principal balance up to $5,000,000, to be funded at request of Puradigm. The Puradigm Note, which incurs interest at a rate of 6.5% due quarterly, has a maturity date of May 14, 2023. The Puradigm Note contains an options conversion clause that allows the Company to convert all, or a portion of all, into new issued member units of Puradigm with the maximum principal amount equal to 18% of the total equity position of Puradigm at conversion. The outstanding principal and interest as of March 31, 2022 and December 31, 2021, approximated $5,164,000 and $5,081,000, respectively, which is classified as Notes receivable on the consolidated balance sheet. South Regional Management District (formally Harris-Montgomery Counties Management District) On September 23, 2021, APB entered into refunding bond anticipatory note (“District Note”) with South Regional Management District (the “District”), which operates as a conservation and reclamation district pursuant to Chapter 3891, Texas Special District Local Laws Code; Chapter 375, Texas Local Government Code; and Chapter 49, Texas Water Code. The District Note was in the sum of $3,500,000 and incurs interest at a rate of 4.15% per annum. Principal and interest are due in full on September 22, 2022. This note may be redeemed prior to maturity with 10 days written notice to APB at a price equal to principal plus interest accrued on the redemption date. The outstanding principal and interest of $3,576,000 and $3,540,000 of the District Note is included in current portion of notes receivable on the consolidated balance sheet at March 31, 2022 and December 31, 2021, respectively. Asili, LLC. On October 25, 2021, APB entered into loan agreements (“Asili Agreement”) with Asili, LLC. (“Asili”) a company registered in the state of Utah. The Asili Agreement has an initial aggregate principal balance up to $1,000,000, to be funded at request of Asili, with an option to increase the maximum principal borrowing to $3,000,000. The Asili Agreement, which incurs interest at a rate of 8.0% with principal and interest due at the maturity date of October 25, 2022. The Asili Agreement contains an optional conversion feature allowing APB to convert the outstanding principal to a 10% membership interest. APB, as holder of the Asili Agreement, has the right to elect one member to the Asili Board of Managers. The outstanding principal and interest of approximately $803,000 and $784,000 of the Asili Agreement is included in current portion of notes receivable on the consolidated balance sheet at March 31, 2022 and December 31, 2021, respectively. Leopoldo Bustamate. On June 13, 2019, APB extended the credit to Leopoldo Bustamate (“Bustamate Note”) in the form of a promissory note for $249,540, bearing interest at 15%, with a maturity date of May 15, 2020. On June 5, 2020, the Company further extended the same credit in the form of a promissory note for $249,540, bearing interest at 15%, with a maturity date of May 14, 2021. On August 30, 2021, the Company further extended the same credit in the form of a promissory note for $249,540, bearing interest at 12.5%, with a maturity date of May 15, 2023. The modification agreement is effective May 14, 2021. This promissory note is secured by a deed of trust on a tract of land, which is approximately 315 acres, and located in Coke County, Texas. The outstanding principal and interest of approximately $289,000 of the Bustamate Note is included in long term portion of Notes receivable on the consolidated balance sheet at March 31, 2022 and December 31, 2021. HWH World Ltd. On October 7, 2021, HWH World, Inc., a subsidiary of the Company entered into a revolving loan commitment (“HWH Ltd Note”) with HWH World Ltd. (“HWH Ltd.”) a company registered in Taiwan. The HWH Ltd. Note has an principal balance of $52,000 and incurred no interest through the maturity date of December 31,2021. The outstanding principal at March 31, 2022 and December 31, 2021 is $56,000 and $52,000, respectively, and is included in the current portion of notes receivable. This note is currently in default and the Company is currently in the process of extending the terms. In accordance with the terms of the HWH Ltd. Note, the Company began charging interest at the default rate of 18% on January 1, 2022. West Park Capital Group, LLC. On December 28, 2021, APB entered into promissory note (“West Park Note”) with West Park Capital Group, LLC. (“West Park”), a company registered in the state of California. The West Park Note has an principal balance of $700,000. The West Park Note, which incurs interest at a rate of 12.0% with principal and interest due at the maturity date of December 28, 2022. The outstanding principal and interest of $680,000 and $700,000 of the West Park Note is included in current portion of notes receivable on the consolidated balance sheet at Mach 31, 2022. 1044PRO, LLC. In January 2021, SHRG and 1044PRO, LLC (“1044 PRO”) entered into a Funding Agreement pursuant to which the Company agreed to provide to 1044 PRO a $250,000 revolving credit line and loaned $204,879 to 1044 PRO under the credit line. Borrowings under the credit line are payable in monthly installments in amounts determined by the amount of each cash advance. At December 31, 2021, loans of $193,000 are outstanding, net of an allowance for the impairment losses of $115,000, and is included in Current portion of notes receivable on the consolidated balance sheet as of December 31, 2021. At March 31, 2022, this loan was fully reserved for. In connection with the loan, the Company acquired a 10% equity interest in 1044 PRO and a security interest in 1044 PRO’s cash receipts and in substantially all 1044 PRO’s assets. XIP Optimal In the fiscal year 2019, SHRG received a promissory note for $106,404 from a prior merchant payment processor in connection with amounts owed to the Company. This note is fully reserved for at March 31, 2022, and December 31, 2021. WUURII Commerce Inc., On March 2, 2022, APB and WUURII Commerce, Inc. (“WUURRII”), a corporation organized under the laws of the Republic of Korea entered into a promissory note (“WUURRII Note”). Under the terms of the WURRII Note, APB at its discretion, may lend up to the principal sum of $892,500 with an interest rate of 8%, and matures in March 2024, with interest payable quarterly. The outstanding principal and interest at March 31, 2022 is $895,000, of which $446,000 is included in current notes receivable on the accompanying consolidated balance sheet. Farah S. Khan On January 24, 2022, APB and Farah S. Khan (“Khan”) entered into a promissory note (“Khan Note”) in the principal sum of $100,000 with interest of 6%, due annually, and maturing in January 2024. The outstanding principal and interest at March 31, 2022 approximates $101,000, and is included in notes receivable on the accompanying consolidate balance sheet.

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