|3 Months Ended|
Mar. 31, 2020
|Subsequent Events [Abstract]|
NOTE 15 – SUBSEQUENT EVENTS
Cost Reduction Plan
On April 5, 2020, the Board of Directors approved workforce reductions as part of the Company’s cost cutting measures implemented in response to the negative financial and operational impacts resulting from the rapidly evolving novel coronavirus (“COVID-19”) pandemic. Approximately 19% of the Company’s 115 employees are impacted through workforce reductions as well as some reduced-hour work weeks.
On April 7, 2020, the Company implemented a cost reduction plan which included the termination of certain employees and elimination of certain costs. Estimated savings from this effort are expected to be $2.5 to $3.0 million for the year ending 2020.
Bressner – Line of Credit
On April 9, 2020, Bressner converted €500,000 of their line of credit from UniCredit Bank to a one year term loan at 1.9% interest with principal and interest due upon maturity.
Senior Secured Convertible Promissory Notes
On April 20, 2020, the Company entered into a Securities Purchase Agreement providing for the issuance of the Company’s Senior Secured Convertible Promissory Notes with a principal face amount of up to 6,000,000. The Notes are, subject to certain conditions, convertible into shares of the Company’s common stock, par value $0.0001 per share at an initial conversion price per share of $2.50. Pursuant to the Purchase Agreement, the Notes will be issued with a 10% original issue discount.
On April 24, 2020, the Company consummated the initial closing of the offering (the “Initial Closing”) under the Purchase Agreement and issued a Senior Secured Convertible Promissory Note with an aggregate of $3,000,000 to an institutional investor (“Initial Note”). The investors purchased the Initial Note for an aggregate purchase price of $2,700,000, at the Initial Closing after a 10% original issue discount. The Initial Note bears no interest rate (except upon event of default) and, unless earlier converted or redeemed, will mature on the date that is the twenty-three (23) month anniversary of the last day from the Initial Closing.
On April 28, 2020, the Company received a two year, 1% Paycheck Protection Program (PPP) loan of $1.5 million.
The Company has evaluated subsequent events after the consolidated balance sheet dated as of March 31, 2020 through the date of filing of this quarterly report. Based upon the Company’s evaluation, management has determined that, other than as disclosed in the accompanying notes, no subsequent events have occurred that would require recognition in the accompanying consolidated financial statements or disclosure in the notes thereto.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef