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Convertible Promissory Notes
12 Months Ended
Dec. 31, 2013
Debt Disclosure [Abstract]  
Convertible Promissory Notes

Note 4 – Convertible Promissory Notes

 

August 19, 2011 Convertible Notes

 

On August 19, 2011, Wizard World entered into stock subscription agreements with certain investors in connection with an offering of up to $455,000 principal amount of Convertible Promissory Notes, with $453,100 being issued. The Notes accrue interest at 14% per annum and are due four (4) months from the date of issuance. The Notes are convertible to common shares at $0.40 per share.

 

In conjunction with the Notes, each investor was granted a Common Stock Purchase Warrant exercisable for one share of common stock of the Company for each $2.00 of investment. The Warrants are earned upon issuance with an exercise price of $0.40 per common share expiring five (5) years from the date of issuance, which may be paid via a cashless exercise.

 

On August 3, 2012, four (4) note-holders converted notes and accrued interest into the Company’s Series A Cumulative Convertible Preferred Stock (the “Series A Preferred”), by entering into Securities Exchange Agreements for the issuance and sale of (i) an aggregate of $406,039 in Series A Preferred. The Series A Preferred is convertible into shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), at a conversion price of $0.40 per share, subject to adjustment.

 

One (1) note-holder was re-paid $25,000 on his convertible note, and converted his remaining principal of $78,100 into the Company’s Series A Preferred. The note-holder forgave the accrued interest due in the amount of $21,298.

 

December 6, 2011 Convertible Debentures

 

Issuance of Convertible Debentures

 

On December 6, 2011, Wizard World entered into stock subscription agreements with certain accredited investors, for the issuance and sale of an aggregate of $325,000 in Senior Convertible Debentures. The Debentures bear interest at six percent (6%) per annum, maturing February 28, 2012. The notes, at issuance, gave rise to a debt discount of $206,375 which is being amortized over the lives of the notes. The debt discount was fully amortized as of February 28, 2012.

 

Mandatory Conversion of Debentures to Series A Convertible Preferred Stock

 

In connection with the March 30, 2012 Series A Preferred Stock Closing, and pursuant to mandatory conversion features of those certain Senior Convertible Debentures in the aggregate amount of $325,000, issued on December 6, 2011, the Debentures were mandatorily converted into shares of Series A Preferred and Warrants upon the same terms of the Offering. A total of 3,250 shares of Series A Preferred and 162,500 Warrants were issued by the Company to the Debenture Investors pursuant to such mandatory conversion.