Emmaus Life Sciences, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2019

Notes payable consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):

Year Issued	Interest Rate Range	Term of Notes	Conversion Price		Principal Outstanding September 30, 2019		Discount Amount September 30, 2019		Carrying Amount September 30, 2019		Shares Underlying September 30, 2019			Principal Outstanding December 31, 2018		Discount Amount December 31, 2018		Carrying Amount December 31, 2018		Shares Underlying Notes December 31, 2018
Notes payable
2013	10%	Due on demand		—	$	926	$	—	$	926		—		$	909	$	—	$	909		—
2015	10%	Due on demand		—		—		—		—		—			10		—		10		—
2016	10% - 11%	Due on demand		—		—		—		—		—			843		—		843		—
2017	5% - 11%	Due on demand		—		—		—		—		—			2,575		—		2,575		—
2018	10% - 11%	Due on demand- 18 months		—		—		—		—		—			12,311		9,233		3,078		—
2019	11%	Due on demand - 6 months		—		2,960		—		2,960		—			—		—		—		—
					$	3,886	$	—	$	3,886		—		$	16,648	$	9,233	$	7,415		—
		Current			$	3,886	$	—	$	3,886		—		$	12,448	$	6,054	$	6,394		—
		Non-current			$	—	$	—	$	—		—		$	4,200	$	3,179	$	1,021		—
Notes payable - related parties
2016	10%	Due on demand		—	$	20	$	—	$	20		—		$	270	$	—	$	270		—
2017	10%	Due on demand		—		—		—		—		—			39		—		39		—
2018	11%	Due on demand		—		159		—		159		—			159		—		159		—
2019	10%	Due on demand		—		14		—		14		—			—		—		—		—
					$	193	$	—	$	193		—		$	468	$	—	$	468		—
		Current			$	193	$	—	$	193		—		$	468	$	—	$	468		—
Convertible debentures
2019	10%	18 months	$	9.52	$	12,200	$	—	$	12,200		1,292	(a)
					$	12,200	$	—	$	12,200		1,292		$	—	$	—	$	—		—
		Current			$	11,000	$	—	$	11,000		1,166		$	—	$	—	$	—		—
		Non-current			$	1,200			$	1,200		126		$	—	$	—	$	—		—
Convertible notes payable
2011	10%	5 years	$3.05		$	—	$	—	$	—		—		$	300	$	—	$	300		98
2014	10%	Due on demand - 2 years	$3.05 - $3.60			—		—		—		—			519		—		519		184
2016	10%	1 year	$	4.50		—		—		—		—			61		—		61		17
2017	10%	Due on demand - 1 year	$3.50 - $4.50			—		—		—		—			2,820		349		2,471		899
2018	6% - 10%	Due on demand - 2 years	$3.50 - $10.00			3,000		72		2,928		356	(b)		19,556		6,169		13,387		3,664
					$	3,000	$	72	$	2,928		356		$	23,256	$	6,518	$	16,738		4,862
		Current			$	3,000	$	72	$	2,928		356		$	16,604	$	5,351	$	11,253		3,981
		Non-current			$	—	$	—	$	—		—		$	6,652	$	1,167	$	5,485		881
Convertible notes payable - related parties
2012	10%	Due on demand	$	3.30	$	—	$	—	$	—		—		$	200	$	—	$	200		74
2015	10%	2 years	$	4.50		—		—		—		—			200		—		200		58
2017	10%	2 years	$	10.00		—		—		—		—			5,000		311		4,689		533
2018	10%	2 years	$	10.00		—		—		—		—			9,400		871		8,529		972
					$	—	$	—	$	—		—		$	14,800	$	1,182	$	13,618		1,637
		Current			$	—	$	—	$	—		—		$	5,400	$	311	$	5,089		665
		Non-current			$	—	$	—	$	—		—		$	9,400	$	871	$	8,529		972
		Total			$	19,279	$	72	$	19,207	$	1,648		$	55,172	$	16,933	$	38,239	$	6,499

(a) The notes are convertible to Emmaus Life Sciences, Inc. shares.
(b) The notes are convertible to EMI Holding, Inc. shares.

Schedule of contractual principal payments of notes payable

Contractual principal payments due on notes payable and debentures are as follows (in thousands):

Year Ending
2019 (three months)	$	6,079
2020		13,200
Total	$	19,279

Schedule of fair value assumptions for warrants issued in conjunction with notes

The fair value of the warrants issued in conjunction with debentures were determined using the Binominal Monte-Carlo Cliquet Option Pricing Model with the following inputs for the nine months ended September 30, 2019 and year ended December 31, 2018 (See Note 8).

	Nine months ended September 30, 2019			Year ended December 31, 2018
Stock price	$	6.86		$	11.10
Exercise price	$	5.87		$	11.30
Term until expiration	4.26 years			5 years
Risk‑free interest rate		1.79	%		3.05	%
Expected dividend yield		—			—
Expected volatility		65.0	%		70.0	%