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Related Party Transactions
6 Months Ended
Jun. 30, 2017
Related Party Transactions [Abstract]  
Related Party Transactions

Note 8. Related Party Transactions

The Company entered into a distributor agreement with CPM effective August 2, 2012, pursuant to which the Company acts as a non-exclusive distributor of certain amniotic membrane products. The term of the agreement is one year and renews on each annual anniversary date for successive one-year terms unless it is terminated in writing by either party. Effective January 1, 2017, this agreement was amended to expand and include Orthopedic Implants and a broader assortment of Biologics. (See Note 1)

During the three-months ended June 30, 2017 and 2016 the Company sold $112,140 and $3,940, respectively, of its products purchased from CPM that are reflected in cost of revenues on the accompanying condensed statements of operations. During the six-months ended June 30, 2017 and 2016 the Company sold $157,582 and $13,000, respectively, of its products purchased from CPM that are reflected in cost of revenues on the accompanying condensed statements of operations.

During the three-months ended June 30, 2017 and 2016 the Company purchased $112,665 and $13,200, respectively, of its products from CPM. During the six-months ended June 30, 2017 and 2016 the Company purchased $158,107 and $13,200, respectively, of its products from CPM. The balance due to CPM at June 30, 2017 and December 31, 2016 was $112,140 and $77,178, respectively, and are reflected within accounts payable – related parties on the accompanying condensed balance sheets.

During July 2016 through October 2016, the Company obtained three short-term loans from the Investors in the aggregate amount of $150,000 in exchange for promissory notes bearing 10% interest per annum, and 18% interest per annum after December 31, 2016, which principal shall be due and payable, upon demand of the payee, at any time after the earlier of: (i) December 31, 2016, or (ii) upon a change in control of the Company. Notwithstanding, on or after January 16, 2017, at the holder’s sole discretion, the holder has the right to convert all or any portion of the then unpaid principal and interest balance into shares of the Company’s common stock at a conversion price of $0.08 per share. The balance of the notes payable at June 30, 2017 and December 31, 2016 was $150,000.

On December 19, 2016, the Company entered into the Purchase Agreement by and among the Company, NC 143, and RMI, pursuant to which NC 143 acquired 5,000,000 shares of the Company’s common stock for a purchase price of $400,000 and RMI acquired 4,000,000 shares of the Company’s common stock for a purchase price of $320,000, effective as of the Closing Date. As direct offering costs amounted to $64,609, net proceeds from the sale of these shares were $655,391. (See Note 1)

During the three-months and six-months ended June 30, 2017, CPM provided shared services for back-office functions such as accounting, finance, supply chain management, and sales support. In addition, the Company’s Chief Executive Officer and Interim Chief Financial Officer provided services at no charge to the Company. The financial statements do not reflect an estimate of fair value of these services.

Effective January 1, 2017 the Company engaged AmBio Staffing, LLC, a Texas licensed professional employment organization to provide payroll processing, employee benefit administration, and related human capital services. AmBio Staffing, LLC is owned and controlled by the Company’s Chairman of the Board of Directors. The balance due to AmBio Staffing, LLC at June 30, 2017 and December 31, 2016 was $8,660 and $0, respectively, and is reflected within accounts payable on the accompanying condensed balance sheets. For the three-months and six-months ended June 30, 2017, $2,757 and $6,877 of fees were paid to AmBio Staffing, LLC for such services, respectively and are reflected within general, administrative and other expenses on the accompanying condensed statements of operations.