XML 15 R23.htm IDEA: XBRL DOCUMENT v2.3.0.15
Related Party Transactions
9 Months Ended
Sep. 30, 2011
Related Party Transactions
Note 17 – Related Party Transactions
 
           On May 23, 2011, the Company issued a demand promissory note (the “Demand Note”) to Brilliant Digital, a related party, in exchange for the principal sum of $0.5 million.  The Demand Note was subject to an annual simple interest rate of 0.56% on the unpaid principal.  The proceeds of the note were used to satisfy a portion of the Company’s accrued expenses. On May 31, 2011, the Company applied the full principal balance of the Demand Note, along with accrued interest, against Brilliant Digital’s purchase of Convertible Promissory Notes and warrants for $2.2 million and the Demand Note was cancelled.
 
           Brilliant Digital is the owner of the Kazaa digital music service, which is jointly operated with the Company.  See Note 4 – Kazaa, for details of the agreements in effect between the Company and Brilliant Digital.  Brilliant Digital is also the holder of 1,040,358 shares of the Company’s common stock, representing approximately 16.4% of the Company’s issued and outstanding shares.