Annual report pursuant to Section 13 and 15(d)

Convertible notes receivable

v3.22.1
Convertible notes receivable
12 Months Ended
Dec. 31, 2021
Receivables [Abstract]  
Convertible notes receivable

Note 6 – Convertible notes receivable

 

Convertible notes receivable consists of the following at December 31, 2021 and 2020:

 

    2021     2020  
November 22, 2017, NeuCourt, Inc. convertible note receivable including accrued interest of $2,834 and $1,454 at December 31, 2021 and 2020. The note bears interest at 5% per annum, originally matured November 22, 2019, and was extended to mature initially to November 22, 2021, and subsequently to November 22, 2023. Principal and accrued interest are due at maturity. Upon extension in November 2021, the Company received $2,496 of accrued interest. Principal and unpaid interest may be converted into a blend of shares of a to-be-created series of Preferred Stock and Common Stock of NeuCourt (i) on closing of a future financing round of at least $750,000, (ii) on the election of NeuCourt on maturity of the Note, or (iii) on election of Mentor following NeuCourt’s election to prepay the Note. *   $ 27,834     $ 26,454  
                 
October 31, 2018, NeuCourt, Inc. convertible note receivable including accrued interest of $8,491 and $5,584 at December 31, 2021 and 2020. The note bears interest at 5% per annum and matures October 31, 2022. Principal and accrued interest are due at maturity. Principal and unpaid interest may be converted into a blend of shares of a to-be-created series of Preferred Stock and Common Stock of NeuCourt (i) on closing of a future financing round of at least $750,000, (ii) on the election of NeuCourt on maturity of the Note, or (iii) on election of Mentor following NeuCourt’s election to prepay the Note. *     58,491       55,584  
                 
Total convertible notes receivable     86,325       82,038  
                 
Less current portion     (58,491 )     (26,454 )
                 
Long term portion   $ 27,834     $ 55,584  

 

* The Conversion Price for each Note is the lower of (i) 75% of the price paid in the Next Equity Financing, or the price obtained by dividing a $3,000,000 valuation cap by the fully diluted number of shares. The number of Conversion Shares issued on conversion shall be the quotient obtained by dividing the outstanding principal and unpaid accrued interest on a Note to be converted on the date of conversion by the Conversion Price (the “Total Number of Shares”), The Total Number of Shares shall consist of Preferred Stock and Common Stock as follows: (i) That number of shares of Preferred Stock obtained by dividing (a) the principal amount of each Note and all accrued and unpaid interest thereunder by (b) the price per share paid by other purchasers of Preferred Stock in the Next Equity Financing (such number of shares, the “Number of Preferred Stock”) and (ii) that number of shares of Common Stock equal to the Total Number of Shares minus the Number of Preferred Stock. Using the valuation cap of $3,000,000, the November 22, 2017 Note would convert into 103,915 Conversion Shares and the October 31, 2018 Note would convert into 218,369 Conversion Shares. In the event of a Corporate Transaction prior to repayment or conversion of the Note, the Company shall receive back two times the outstanding principal on the Note, plus all accrued unpaid interest.