Related Party Transactions
|6 Months Ended|
Jun. 30, 2018
|Related Party Transactions [Abstract]|
|Related Party Transactions Disclosure [Text Block]||
Note 8 — Related Party Transactions
As of June 30, 2018 and December 31, 2017, due from related party consists of amounts due from SRM Entertainment Group LLC (“SRM LLC”), which was the parent of SRM prior to its acquisition by Xspand, related to operating expenses that were paid for on behalf of one related party to the other related party. As of June 30, 2018 and December 31, 2017, the net amount due from related parties was $1,250,959 and $834,897, respectively. Such amounts are due currently.
In connection with the acquisition of SRM and Fergco, Xspand issued two notes payable aggregating $2,996,500. One note was issued to NL Penn Capital, L.P, in relation to the acquisition of SRM in the amount of $2,120,000 and the other note was issued to the stockholders of Fergco in the amount of $876,500. The notes bear interest at a rate of six percent (6%) per annum and have an effective interest rate of six percent (6%) per annum. Xspand is required to make monthly payments comprised of principal and interest beginning in January 2018 that are amortized over ten (10) years, with a balloon payment of all outstanding principal and interest due at the respective maturity dates ($677,698 due on December 1, 2020 and $1,249,043 due on December 1, 2022). Related party interest expense was $102,942 and $0 for the six months ended June 30, 2018 and 2017, respectively. The scheduled maturities of the notes payable for the next five years as of June 30, 2018, are as follows:
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef