| RELATED PARTY TRANSACTIONS |
NOTE 13—RELATED PARTY TRANSACTIONS
The following table sets forth information relating to our loans from related persons outstanding at any time during the year ended December 31, 2019 (in thousands except for conversion rate and share information).
|
Class
|
Lender
|
|
Interest
Rate
|
|
|
Date of
Loan
|
|
Term of Loan
|
|
Principal Amount Outstanding at December 31, 2019
|
|
|
Highest
Principal
Outstanding
|
|
|
Amount of
Principal
Repaid or
Converted
into Stock
|
|
|
Amount of
Interest
Paid
|
|
|
Conversion
Rate
|
|
|
Shares Underlying Notes December 31, 2019
|
|
|
Current, Promissory note payable to related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lan T. Tran (2)
|
|
10%
|
|
|
4/29/2016
|
|
Due on Demand
|
|
$
|
20
|
|
|
$
|
20
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Hope International Hospice, Inc. (1)
|
|
10%
|
|
|
6/3/2016
|
|
Due on Demand
|
|
|
—
|
|
|
|
250
|
|
|
|
250
|
|
|
|
78
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
10%
|
|
|
2/9/2017
|
|
Due on Demand
|
|
|
—
|
|
|
|
12
|
|
|
|
—
|
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Yutaka Niihara (2)(3)
|
|
10%
|
|
|
9/14/2017
|
|
Due on Demand
|
|
|
—
|
|
|
|
904
|
|
|
|
27
|
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
11%
|
|
|
2/10/2018
|
|
Due on Demand
|
|
|
159
|
|
|
|
159
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
10%
|
|
|
2/9/2019
|
|
Due on Demand
|
|
|
14
|
|
|
|
14
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
$
|
193
|
|
|
$
|
1,359
|
|
|
$
|
277
|
|
|
$
|
82
|
|
|
|
|
|
|
|
—
|
|
|
Current, Convertible notes payable to related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yasushi Nagasaki (2)
|
|
10%
|
|
|
6/29/2012
|
|
Due on Demand
|
|
$
|
—
|
|
|
$
|
200
|
|
|
$
|
200
|
|
|
$
|
56
|
|
|
$
|
3.30
|
|
|
|
—
|
|
|
|
Yutaka & Soomi Niihara (2)(3)
|
|
10%
|
|
|
11/16/2015
|
|
2 years
|
|
|
—
|
|
|
|
200
|
|
|
|
200
|
|
|
|
73
|
|
|
$
|
4.50
|
|
|
|
—
|
|
|
|
Wei Peu Zen (3)
|
|
10%
|
|
|
11/6/2017
|
|
2 years
|
|
|
—
|
|
|
|
5,000
|
|
|
|
5,000
|
|
|
|
597
|
|
|
$
|
10.00
|
|
|
|
—
|
|
|
|
Profit Preview International Group, Ltd. (4)
|
|
10%
|
|
|
2/1/2018
|
|
2 years
|
|
|
—
|
|
|
|
4,037
|
|
|
|
4,037
|
|
|
|
385
|
|
|
$
|
10.00
|
|
|
|
—
|
|
|
|
Profit Preview International Group, Ltd. (4)
|
|
10%
|
|
|
3/21/2018
|
|
2 years
|
|
|
—
|
|
|
|
5,363
|
|
|
|
5,363
|
|
|
|
442
|
|
|
$
|
10.00
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
$
|
—
|
|
|
$
|
14,800
|
|
|
$
|
14,800
|
|
|
$
|
1,553
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
193
|
|
|
$
|
16,159
|
|
|
$
|
15,077
|
|
|
$
|
1,635
|
|
|
|
|
|
|
|
—
|
|
The following table sets forth information relating to our loans from related persons outstanding at any time during the year ended December 31, 2018 (in thousands except for conversion rate and share information).
|
Class
|
Lender
|
|
Interest rate
|
|
|
Date of loan
|
|
Term of Loan
|
|
Principal Amount Outstanding at December 31, 2018
|
|
|
Highest Principal Outstanding
|
|
|
Amount of Principal Repaid
|
|
|
Amount of Interest Paid
|
|
|
Conversion Rate
|
|
|
Shares Underlying Notes at December 31, 2018
|
|
|
Current, Promissory note payable to related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Masaharu & Emiko Osato (3)
|
|
11%
|
|
|
12/29/2015
|
|
Due on Demand
|
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
300
|
|
|
$
|
76
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
11%
|
|
|
2/10/2016
|
|
Due on Demand
|
|
|
—
|
|
|
|
131
|
|
|
|
131
|
|
|
|
29
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Masaharu & Emiko Osato (3)
|
|
11%
|
|
|
2/25/2016
|
|
Due on Demand
|
|
|
—
|
|
|
|
400
|
|
|
|
400
|
|
|
|
94
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
10%
|
|
|
4/29/2016
|
|
Due on Demand
|
|
|
20
|
|
|
|
20
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Hope International Hospice, Inc. (1)
|
|
10%
|
|
|
6/3/2016
|
|
Due on Demand
|
|
|
250
|
|
|
|
250
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
10%
|
|
|
2/9/2017
|
|
Due on Demand
|
|
|
12
|
|
|
|
12
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Yutaka Niihara (2)(3)
|
|
10%
|
|
|
9/14/2017
|
|
Due on Demand
|
|
|
27
|
|
|
|
904
|
|
|
|
877
|
|
|
|
95
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Lan T. Tran (2)
|
|
11%
|
|
|
2/10/2018
|
|
Due on Demand
|
|
|
159
|
|
|
|
159
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
$
|
468
|
|
|
$
|
2,176
|
|
|
$
|
1,708
|
|
|
$
|
294
|
|
|
|
|
|
|
|
—
|
|
|
Current, Convertible notes payable to related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yasushi Nagasaki (2)
|
|
10%
|
|
|
6/29/2012
|
|
Due on Demand
|
|
|
200
|
|
|
|
200
|
|
|
|
—
|
|
|
|
—
|
|
|
$
|
3.30
|
|
|
|
74,182
|
|
|
|
Yutaka & Soomi Niihara (2)(3)
|
|
10%
|
|
|
11/16/2015
|
|
2 years
|
|
|
200
|
|
|
|
200
|
|
|
|
—
|
|
|
|
—
|
|
|
$
|
4.50
|
|
|
|
58,350
|
|
|
|
Wei Peu Zen (3)
|
|
10%
|
|
|
11/6/2017
|
|
2 years
|
|
|
5,000
|
|
|
|
5,000
|
|
|
|
—
|
|
|
|
250
|
|
|
$
|
10.00
|
|
|
|
532,671
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
$
|
5,400
|
|
|
$
|
5,400
|
|
|
$
|
—
|
|
|
$
|
250
|
|
|
|
|
|
|
|
665,203
|
|
|
Non Current, Convertible notes payable to related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit Preview International Group, Ltd. (4)
|
|
10%
|
|
|
2/1/2018
|
|
2 years
|
|
|
4,037
|
|
|
|
4,037
|
|
|
|
—
|
|
|
|
202
|
|
|
$
|
10.00
|
|
|
|
420,456
|
|
|
|
Profit Preview International Group, Ltd. (4)
|
|
10%
|
|
|
3/21/2018
|
|
2 years
|
|
|
5,363
|
|
|
|
5,363
|
|
|
|
—
|
|
|
|
268
|
|
|
$
|
10.00
|
|
|
|
551,507
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
$
|
9,400
|
|
|
$
|
9,400
|
|
|
$
|
—
|
|
|
$
|
470
|
|
|
|
|
|
|
|
971,963
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
15,268
|
|
|
$
|
16,976
|
|
|
$
|
1,708
|
|
|
$
|
1,014
|
|
|
|
|
|
|
|
1,637,166
|
|
|
(1)
|
Dr. Niihara, the Chairman of the Board and Chief Executive Officer of the Company, is co-owner with his wife Soomi Niihara, a director and the Chief Executive Officer of Hope International Hospice, Inc.
|
|
(4)
|
Mr. Zen, a director of the Company, is the sole owner of Profit Preview International Group, Ltd.
|
See Note 8 for a discussion of the Company’s revolving line of credit agreement with Dr. Niihara.
See Notes 4 and 12 for a discussion of the Company’s distribution and supply agreements with Telcon, which holds 4,844,622 shares of the Company common stock, or approximately 8.5% of the common stock outstanding as of December 31, 2019. As of December 31, 2019, the Company held 6,643,559 shares Telcon stock as discussed in Note 6.
|