CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

9 Months Ended

Sep. 30, 2023

Convertible Notes Payable Related Parties

CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

15. CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

The convertible notes payable, related party were issued as part of consideration for the acquisition of Forever 8. The discount was calculated based on the fair value of the instrument as of October 1, 2022. See Note 3 – “Acquisitions” for further information. Principal due under the convertible note payable – related parties was as follows at September 30, 2023 and December 31, 2022:

	September 30, 2023			December 31, 2022
Notes payable, 10%		27,383,700			27,500,000
Less: debt discount		(2,000,000	)		(2,750,000	)
Notes payable, net	$	25,383,700		$	24,750,000

Interest expense under convertible notes payable – related parties was $187,000 and $0, of which $250,000 and $0 was related to amortization of the debt discount, for the three months ended September 30, 2023 and 2022, respectively, and $2,061,000 and $0, of which $500,000 and $0 was related to amortization of the debt discount, for the nine months ended September 30, 2023 and 2022, respectively.