| Equity and Debt Financing Agreements and Fair Value Measurements | 8. Equity and Debt Financing Agreements
and Fair Value Measurements Convertible Note Financings Short-term convertible debt for the years ended
December 31, 2016 and 2015 are as follows (in thousands):
2016 2015
Notes Accrued Interest Total Notes Accrued Interest Total
Convertible notes with accrued interest accounted for as stock settled debt $ 602 $ 36 $ 638 $ 200 $ — $ 200
Conversion premiums 287 — 287 — — —
889 36 925 200 — 200
Convertible notes with embedded derivatives 4,611 819 5,430 5,984 650 6,634
Derivative discounts (1,367 ) — (1,367 ) (4,054 ) — (4,054 )
3,244 819 4,063 1,930 650 2,580
Original issue discounts and loan fee discounts (180 ) — (180 ) (652 ) — (652 )
$ 3,953 $ 855 $ 4,808 $ 1,478 $ 650 $ 2,128 Dominion Convertible Debt Financings On November 25, 2014, the
Company closed a financing transaction by entering into a Securities Purchase Agreement dated November 25, 2014 (the “Note
I SPA”) with Dominion Capital LLC (the “Purchaser”) for an aggregate subscription amount of $4,000,000 (the “Purchase
Price”). Pursuant to the Note I SPA, the Company issued a series of 4% Original Issue Discount Senior Secured Convertible
Promissory Notes (collectively, the “Note I”) to the Purchaser. The Purchase Price will be paid in eight equal monthly
payments of $500,000. Each individual Note was issued upon payment and will be amortized beginning six months after issuance, with
amortization payments being 1/24 th On December 24, 2014, Ironridge
and Dominion Capital LLC entered into a purchase and assignment of the debenture, and the Company and Dominion amended the Debenture,
with the total amount owed as of December 24, 2014 at $434,592, making the note a demand note with terms and conditions identical
to Purchaser’s notes pursuant to the $4 Million Financing Agreement. Pursuant to the amendment the maturity date was extended
to May 31, 2015. Additionally, on December 24, 2014 the Company and Purchaser entered into a $158,400 Senior Convertible, Redeemable
Debenture of PositiveID Corporation, which was issued without proceeds as consideration for the Purchaser’s expenses in conjunction
with the purchase and assignment with Ironridge, including legal and transaction fees. This amount was recorded as a loss on debt
extinguishment. As of December 31, 2014, the Company no longer has any outstanding debt owed to Ironridge. In connection with the
issuance of the Debenture and the Note, the Company recorded a debt discount of $522,061 related to the embedded conversion option
derivative liability which has been fully amortized during the year ended December 31, 2015. The outstanding principal and interest
on the Debenture was fully converted into 6,775,018 shares of common stock as of December 31, 2015. As the note conversion includes
a “lesser of” pricing provision, a derivative liability of $571,387 was recorded when the note was entered into. The
derivative liability was remeasured at each balance sheet date and $466,035 was reclassified into equity on a pro-rata basis upon
conversion of the note. On August 14, 2015, the
Company closed a financing transaction by entering into a Securities Purchase Agreement dated August 14, 2015 (the “Note
II SPA”) with Dominion Capital LLC (the “Purchaser”) for an aggregate subscription amount of $2,400,000 (the
“Purchase Price”). Pursuant to the Note II SPA, the Company issued a series of 4% Original Issue Discount Senior Secured
Convertible Promissory Note (collectively, the “Note II”) to the Purchaser. The Purchase Price was paid in six equal
monthly payments of $400,000. Each individual Note was issued upon payment and is amortized beginning six months after issuance,
with amortization payments being 1/24 th The aggregate principal
amount of both Notes I and II are issued with a 4% original issue discount whereby the aggregate principal amount of Notes I and
II is $6,400,000 but the actual purchase price of Notes I and II is $6,144,000. Each of Notes I and II accrue interest at a rate
equal to 12% per annum and with maturity dates, depending on the date funded, between June 26, 2016 and June 30, 2017. Notes I
and II are convertible any time after the issuance date of the notes. The Purchasers have the right to convert Note I into shares
of the Company’s common stock at a conversion price equal to 95% of the daily VWAP on the trading day immediately prior to
the closing of each tranche. The Purchasers have the right to convert Note II into shares of the Company’s common stock at
a conversion price equal to $1.40. Additionally, under certain conditions defined in Notes I and II, the notes would be convertible
into common stock at a price equal to 62.5% of the lowest VWAP during the 15 Trading Days immediately prior to the applicable amortization
date. In the event that there is an Event of Default or certain conditions are not met, the conversion price will be adjusted to
equal to 55% of the lowest VWAP during the thirty (30) Trading Days immediately prior to the applicable Conversion Date. Notes
I and II can be prepaid at any time upon five days’ notice to the Holder by paying an amount in cash equal to the outstanding
principal and interest and a 120% premium. During 2015, the Company
had received all eight tranches under the Note I SPA ($500,000 principal in 2014 and $3,650,000 principal in 2015 which includes
an additional $150,000 added to one of the agreed $500,000 monthly funding as requested by the Company), with maturity dates, depending
on the date funded, between June 26, 2016 and December 29, 2016, pursuant to a convertible note. Under the agreement, the Company
received $3,540,600, which was net of the $448,400 Purchaser’s expenses and legal fees and $166,000 which represents the
4% original issue discount. As of June 30, 2016, the Company has received, all six tranches under the Note II SPA ($2,281,250 in
principal in 2015 and $208,333 in 2016) with maturity dates of February 15, 2017 and June 30, 2017, pursuant to a convertible note.
Under the agreement, the Company received $2,143,000, which was net of Purchaser’s expenses, legal fees of $247,000 and a
4% original issue discount of $99,583. The notes might be accelerated if an event of default occurs under the terms of the note,
including the Company’s failure to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent
in its SEC filings. In connection with the issuance of Notes I and II, the Company recorded a debt discount of $387,000 in 2014,
$5,116,600 in 2015 and $180,000 in 2016, totaling to $5,683,600 of debt discount recorded, related to the embedded conversion option
derivative liability. The amortization expense related to that discount recorded were approximately $3,331,000 and $3,287,000 as
of December 31, 2015 and 2016, respectively. During the year ended December 31, 2016, $4,064,000 of the outstanding principal and
interest on Notes I and II was converted into 1,332,319,530 shares of common stock. As of December 31, 2016, the outstanding principal
and interest on Notes I and II were $2,128,700. As the note conversion includes a “lesser of” pricing provision, a
derivative liability of $8,936,405 was recorded when Notes I and II were entered into. The derivative liability is re-measured
at each balance sheet date and reclassified to equity on a pro-rata basis upon conversion of the note, the derivative liability
balance for Notes I and II at December 31, 2016 was $2,176,258. On December 22, 2015, in
order to finance the acquisition of ENG, the Company closed a financing transaction by entering into a Securities Purchase Agreement
dated December 22, 2015 (the “Note III SPA”) for an aggregate principal amount of $904,042 and subscription amount
of $865,000, net of OID (the “Purchase Price”). The Company also reimbursed the Purchaser $30,000 for legal fees and
expenses from the proceeds of the Note. Pursuant to the Note III SPA, the Company shall issue a 4% Original Issue Discount Senior
Secured Convertible Promissory Note (the “Note III”) to Dominion. Note III was issued upon payment and will be amortized
beginning six months after issuance, with amortization payments being 1/24th of the principal and accrued interest, made in cash
or common stock, on a semi-monthly basis, subject to certain conditions contained in the Note III SPA. The amortization payments
will begin to be due starting on the 15th day of the month immediately following the six-month anniversary of the Closing Date.
The Company received funding for Note III on December 24, 2015, net proceeds of $751,500 (net of the $152,542 of legal fees, expenses
and OID). Note III accrues interest at a rate equal to 12% per annum (interest is guaranteed for the first twelve months) and has
a maturity date of June 15, 2017. Note III is convertible any time after its issuance date and Dominion has the right to convert
any or all of Note III into shares of the Company’s common stock at a conversion price equal to $1.10, subject to adjustment
as described in Note III. Additionally, under certain conditions defined in Note III, it may also be convertible into common stock
at a price equal to 62.5% of the lowest VWAP during the 15 Trading Days immediately prior to the applicable amortization date.
In the event that there is an Event of Default or certain conditions are not met, the conversion price will be adjusted to equal
to 55% of the lowest VWAP during the thirty (30) Trading Days immediately prior to the applicable Conversion Date. Note III can
be prepaid at any time upon five days’ notice to the Dominion by paying an amount in cash equal to the outstanding principal
and interest, and a 20% premium. In connection with the issuance of the Note III, the Company recorded a debt discount of $751,500
when Note III was entered into, related to the embedded conversion option derivative liability. The amortization expense related
to that discount recorded was approximately $10,000 and $510,000 during the year ended December 31, 2015 and 2016, respectively.
As of December 31, 2016, the outstanding principal and interest on Note III was $1,013,000. As the note conversion includes a “lesser
of” pricing provision, a derivative liability of $1,267,800 was recorded when Note III was entered into. The derivative liability
is re-measured at each balance sheet date, the derivative liability balance for Note III at December 31, 2016 was $605,719. On January 28, 2016, the
Company closed a financing transaction by entering into a Securities Purchase Agreement dated January 28, 2016 (the “Note
IV SPA”) with Dominion Capital LLC (the “Purchaser”) for an aggregate principal amount of $2,187,500 and subscription
amount of $2,100,000 (the “Purchase Price”), net of OID. Pursuant to the Note IV SPA, the Company shall issue a series
of 4% Original Issue Discount Senior Secured Convertible Promissory Notes (collectively, the “Note IV”) to the Purchaser.
The Purchase Price is scheduled to be paid in six equal monthly tranches of $350,000, subject to the discretion of the Purchaser.
Each individual Note will be issued upon payment and will be amortized beginning six months after issuance, with amortization payments
being 1/24th of the principal and accrued interest, made in cash or common stock at the option of the Company, on a semi-monthly
basis, subject to certain conditions and limitations contained in the Note IV SPA. The amortization payments will begin on the
15th day of the month immediately following the six-month anniversary of the Closing Date. The Company also reimbursed the Purchaser
$20,000 for expenses from the proceeds of the first tranche and the Purchaser’s counsel $10,000 from the first tranche. During
the year ended December 31, 2016, the Company has received a total of $604,763 net proceeds under Note IV (net of the $93,153 of
legal fees, expenses and OID). Note IV accrues interest at a rate equal to 12% per annum (interest is guaranteed for the first
twelve months) and has a maturity dates between July 15, 2017 and March 16, 2018. Note IV is convertible any time after its issuance
date and Dominion has the right to convert any or all of Note IV into shares of the Company’s common stock at a conversion
price equal to $1.10 subject to adjustment as described in Note IV. Additionally, under certain conditions defined in Note IV,
it may also be convertible into common stock at a price equal to 62.5% of the lowest VWAP during the 15 Trading Days immediately
prior to the applicable amortization date. In the event that there is an Event of Default or certain conditions are not met, the
conversion price will be adjusted to equal to 55% of the lowest VWAP during the thirty (30) Trading Days immediately prior to the
applicable Conversion Date. Note IV can be prepaid at any time upon five days’ notice to the Dominion by paying an amount
in cash equal to the outstanding principal and interest, and a 20% premium. Subsequent to the funding of the first tranche the
Purchaser and the Company agreed to delay further tranches, until such time as the Purchaser and Company mutually agree, both as
to timing and amount. In connection with the issuances of Note IV, the Company recorded a debt discount of $604,800 when the notes
were entered into, related to the embedded conversion option derivative liability. The amortization expense related to that discount
recorded was approximately $263,000 for the during the year ended December 31, 2016. As of December 31, 2016, the outstanding principal
and interest on Note IV was $752,725. As the note conversion includes a “lesser of” pricing provision, a derivative
liability of $941,800 was recorded when Note IV was entered into. The derivative liability is re-measured at each balance sheet
date, the derivative liability balance for Note IV at December 31, 2016 was $465,663. Pursuant to the Company’s
obligations under Notes I, II, III and IV, the Company entered into a Security Agreement with the Purchaser, pursuant to which
the Company granted a lien on all assets of the Company, subject to existing security interests, (the “Collateral”)
for the benefit of the Purchaser, to secure the Company’s obligations under the Note. In the event of a default as defined
in Notes I, II, III and IV, the Purchaser may, among other things, collect or take possession of the Collateral, proceed with the
foreclosure of the security interest in the Collateral or sell, lease or dispose of the Collateral. Other Convertible Debt Financing On June 18, 2014, the Company
closed a financing agreement whereby the Company borrowed an aggregate principal amount of $247,500 with a 10% original note discount.
The note has an interest rate of 10%, and is convertible at the option of the lender into shares of the Company’s common
stock at the lesser of (i) a 40% discount to the lowest closing bid price in the 20 trading days prior to conversion or (ii) $3.75.
The note might be accelerated if an event of default occurs under the terms of the note, including the Company’s failure
to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent in its SEC filings. The first
tranche was funded on June 18, 2014 with a principal amount of $55,000 and net proceeds of $50,000, with a maturity date of June
17, 2016, pursuant to the convertible note. In connection with the issuance of the note, the Company recorded a debt discount of
$50,000 related to the derivative liability which was fully amortized as of June 30, 2015. As of June 30, 2015, the outstanding
principal and interest of the note was fully converted into 88,518 shares of common stock. As the note conversion includes a “lesser
of” pricing provision, a derivative liability of $59,623 was recorded when the note was entered into. The derivative liability
was re-measured at each balance sheet date and was reclassified to equity upon conversion of the note. The second tranche was funded
on September 19, 2014, with a principal amount of $55,000 and net proceeds of $50,000, with a maturity date of September 19, 2015,
pursuant to a convertible note. In connection with the issuance of the notes, the Company recorded a debt discount of $50,000 related
to the derivative liability which was fully amortized as of June 30, 2015. As of June 30, 2015, the outstanding principal and interest
on the notes was fully converted into 139,619 shares of common stock. As the note conversion includes a “lesser of”
pricing provision, a derivative liability of $59,623 was recorded when the note was entered into. The derivative liability was
re-measured at each balance sheet date and was reclassified to equity upon conversion of the note. The third tranche was funded
on December 22, 2014, with a principal amount of $55,000 and net proceeds of $50,000, with a maturity date of December 22, 2015,
pursuant to a convertible note. The Company recorded a debt discount of $50,000 related to the derivative liability which was fully
amortized as of September 30, 2015. As of September 30, 2015, the outstanding principal and interest of the note was fully converted
into 117,147 shares of common stock. As the note conversion includes a “lesser of” pricing provision, a derivative
liability of $62,118 was recorded when the note was entered into. The derivative liability was re-measured at each balance sheet
date and was reclassified to equity upon conversion of the note. The fourth tranche was funded on January 13, 2016, with a principal
amount of $82,500 and net proceeds of $75,000, with a maturity date of January 13, 2018, pursuant to a convertible note. In connection
with the issuance of the note, the Company recorded a debt discount of $75,000, related to the embedded conversion option derivative
liability which has been fully amortized during the year ended December 31, 2016. As of December 31, 2016, the outstanding principal
and interest on the note was fully converted into 2,078,184 shares of common stock. As the note conversion includes a “lesser
of” pricing provision, a derivative liability of $122,263 was recorded when the note was entered into. The derivative liability
is re-measured at each balance sheet date and reclassified to equity on a pro-rata basis upon conversion of the note. On July 3, 2014, the Company
borrowed $115,000 with a maturity date of July 3, 2015, pursuant to a convertible note. Under the agreement, the Company received
$100,000, which was net of legal and due diligence fees. The Note has an interest rate of 8%, and is convertible at the option
of the lender into shares of the Company’s common stock at the lesser of $2.10 per share or a 40% discount of the lowest
closing bid prices in the 15 trading days prior to conversion. The note might be accelerated if an event of default occurs under
the terms of the note, including the Company’s failure to pay principal and interest when due, certain bankruptcy events
or if the Company is delinquent in its SEC filings. In connection with the issuance of the notes, the Company recorded a debt discount
of $58,571 relating to derivative liability which was fully amortized as of March 31, 2015. As of March 31, 2015, the outstanding
principal and interest on the note was fully converted into 164,974 shares of common stocks. In conjunction with the Note, the
Company granted the lender a warrant for 1,000,000 common shares at a strike price of $4.00. The warrant has a life of three years
and its relative fair value of $41,429 has been recorded as a debt discount and additional paid in capital as of March 31, 2015.
As the note conversion includes a “lesser of” pricing provision, a derivative liability of $59,623 was recorded when
the note was entered into. The derivative liability was re-measured at each balance sheet date and was reclassified to equity upon
conversion of the note. On July 7, 2014, the Company
borrowed $53,000 with a maturity date of March 25, 2015, pursuant to a financing agreement. Under the agreement, the Company received
$50,000, which was net of legal fees. The note bears interest at 8% per annum and is convertible at the option of the lender into
shares of the Company’s common stock at a 39% discount to the price of common shares in the 10 days prior to conversion.
The note might be accelerated if an event of default occurs under the terms of the note, including the Company’s failure
to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent in its SEC filings. In connection
with the issuance of the note, the Company computed a premium of $33,885 as the note is considered stock settled debt under ASC
480, all of which was accreted and charged to interest expense in the year ended December 31, 2014. As of June 30, 2015, the Company
exercised its right to prepay the outstanding principal and interest for a total redemption amount of $73,629 and recorded a loss
on extinguishment of approximately $18,550. On July 9, 2014 and August
21, 2014, the Company borrowed from a lender, notes each amounting to $110,000, which matures twelve months from the date of the
respective notes, pursuant the agreement. Each debt was issued at a 10% original issue discount resulting in net total proceeds
of $180,000, net of legal fees. The notes bear an interest rate of 10%, and are convertible at the option of the lender into shares
of the Company’s common stock at a 40% discount to the lowest closing bid price during the 15 days prior to the election
to conversion. The notes could have been accelerated if an event of default occurs under the terms of the note, including the Company’s
failure to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent in its SEC filings. In
connection with the issuance of the note, the Company computed a total premium of $146,666 as the notes were considered stock settled
debt under ASC 480. On December 30, 2014, the Lender and Dominion Capital LLC entered into a purchase and assignment of these notes.
Subsequent to the purchase and assignment, the note was amended by the Company and the Purchaser, using the form of note identical
to the notes used in the $4 Million Financing Agreement. The Company issued a new note for $222,222 convertible at the lesser of
a 37.5% discount to the common stock price on the date of the note or a 37.5% discount to the price of our common stock price at
the time of conversion. In conjunction with the purchase and assignment, the Company and Purchaser entered into a new note with
a principal value of $49,444 as compensation for Purchaser’s costs related to the purchase and assignment. This $49,444 was
expensed as a loss on debt extinguishment. In connection with the issuance of the notes, the Company recorded a debt discount of
$271,666 related to the embedded conversion option derivative liability which was fully amortized as of June 30, 2015. As of September
30, 2015, the remaining outstanding principal and interest on the notes was fully converted into 128,685 shares of common stock.
As the note conversions includes a “lesser of” pricing provision, a derivative liability of $289,701 was recorded when
these notes were entered into. The derivative liability was re-measured at each balance sheet date and was reclassified to equity
upon conversion of the note. On July 17, 2014, the Company
borrowed $115,000 with a maturity date of July 17, 2016, pursuant to a convertible note. The debt was issued at a 10% original
issue discount resulting in proceeds of $100,000, has an interest rate of 10%, and is convertible at the option of the lender into
shares of the Company’s common stock at the lesser of $3.00 per share or a 40% discount of the lowest closing bid prices
in the 20 trading days prior to conversion. The note might be accelerated if an event of default occurs under the terms of the
note, including the Company’s failure to pay principal and interest when due, certain bankruptcy events or if the Company
is delinquent in its SEC filings. In connection with the issuance of the notes, the Company recorded a debt discount of $100,000
related to the derivative liability which was fully was fully amortized as of June 30, 2015. On January 8, 2015, the Company exercised
its right to prepay the outstanding principal and interest for a total redemption amount of $120,750. As the note conversion includes
a “lesser of” pricing provision, a derivative liability of $124,666 was recorded when the note was entered into. The
derivative liability was re-measured at each balance sheet date and was reclassified to equity on a pro-rata basis upon redemption
of the note. On August 19, 2014, the
Company borrowed $66,000 with a maturity date of August 15, 2015, pursuant to a convertible note. The debt was issued at a 10%
original issue discount resulting in proceeds of $54,500, net of legal fees. The Note has an interest rate of 8%, and is convertible
at the option of the lender into shares of the Company’s common stock at the lesser of $3.00 per share or a 60% of the average
of the three lowest closing bid prices 15 trading days prior to conversion. The note might be accelerated if an event of default
occurs under the terms of the note, including the Company’s failure to pay principal and interest when due, certain bankruptcy
events or if the Company is delinquent in its SEC filings. In connection with the issuance of the notes, the Company recorded a
debt discount of $54,500 related to the derivative liability which was fully amortized as of June 30, 2015. The outstanding principal
and interest on the note was fully converted into 100,000 shares of common stock as of December 31, 2015. As the note conversion
includes a “lesser of” pricing provision, a derivative liability of $71,548 was recorded when the note was entered
into. The derivative liability was re-measured at each balance sheet date and was reclassified to equity on a pro-rata basis upon
conversion of the note. On September 4, 2014, the
Company borrowed $110,000 pursuant to a convertible note with an OID of $10,000 resulting in cash received of $100,000. The debt
matures twenty four months from the date funded, has a one-time 10% interest charge if not paid within 90 days, and is convertible
at the option of the lender into shares of the Company’s common stock at the lesser of $2.10 per share or 60% of the average
of the two lowest closing bid prices in the 25 trading days prior to conversion. The note might be accelerated if an event of default
occurs under the terms of the note, including the Company’s failure to pay principal and interest when due, certain bankruptcy
events or if the Company is delinquent in its SEC filings. In connection with the issuance of the notes, the Company recorded a
debt discount of $100,000 which was fully amortized as of June 30, 2015. As of December 31, 2015, the outstanding principal and
interest on the notes was fully converted into 183,907 shares of common stock. As the note conversion includes a “lesser
of” pricing provision, a derivative liability of $119,246 was recorded when the note was entered into. The derivative liability
was re-measured at each balance sheet date and was reclassified to equity on a pro-rata basis upon conversion of the note. On September 22, 2014,
Company closed a Securities Purchase Agreement providing for the purchase of two Convertible Redeemable Notes in the aggregate
principal amount of $100,000. The two notes bear interest at the rate of 8% per annum; are due and payable on September 15, 2015;
and may be converted at the option of the lender into shares of Company common stock at a conversion price equal to a 40% discount
of the lowest closing bid price calculated at the time of conversion. The two notes also contain certain representations, warranties,
covenants and events of default, and increases in the amount of the principal and interest rates under the two Notes in the event
of such defaults. The first note in the amount of $50,000 was funded on September 22, 2014, with the Company receiving $45,000
of net proceeds, which was net of legal and due diligence fees. In connection with the issuance of the first note, the Company
computed a premium of $33,333 as the note is considered stock settled debt under ASC 480 which had been fully amortized as of June
30, 2015. As of June 30, 2015, the outstanding principal and interest on the first note was converted into 101,918 shares of common
stock. The second note in the amount of $50,000 was initially paid for by the issuance of an offsetting $50,000 secured note issued
by the lender to the Company. The second note was funded on April 24, 2015, with the Company receiving $45,000 of net proceeds,
which was net of legal and due diligence fees. In connection with the issuance of the second note, the Company computed a premium
of $33,333 as the note is considered stock settled debt under ASC 480 which was fully amortized during the as of June 30, 2015.
As of December 31, 2015, the outstanding principal and interest of the second note was fully converted into 104,211 shares of common
stock. On September 22, 2014,
the Company borrowed $54,750 with a maturity date of June 19, 2015, pursuant to a financing agreement. Under the agreement, the
Company received $50,000, which was net of legal and due diligence fees. The note bears interest at 8% per annum and is convertible
at the option of the lender into shares of the Company’s common stock at a 40% discount to the price of common shares in
the 10 days prior to conversion. The note might be accelerated if an event of default occurs under the terms of the note, including
the Company’s failure to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent in
its SEC filings. In connection with the issuance of the note, the Company computed a premium of $36,500 as the note is considered
stock settled debt under ASC 480. On March 10, 2015, the Lender and Dominion Capital LLC entered into a purchase and assignment
of the note (see paragraph below), and the Company and Dominion amended the note, with the total amount owed as of March 10, 2015
at $56,778, with terms and conditions identical to Purchaser’s notes pursuant to the $4 Million Financing Agreement. Pursuant
to the amendment the maturity date was extended to September 30, 2015. Additionally, on March 10, 2015, the Company and Purchaser
entered into a $24,772 Senior Convertible, Redeemable Debenture of PositiveID Corporation, which was issued without proceeds as
consideration for the Purchaser’s expenses in conjunction with the purchase and assignment with the Lender, including legal
and transaction fees (see paragraph below). This amount was recorded as a loss on debt extinguishment. As of March 31, 2015, the
Company no longer has any outstanding debt owed to the Lender. The total recorded premium was accreted and charged to interest
expense upon the assignment of the convertible note. On September 24, 2014,
the Company borrowed $75,000 pursuant to the back-end note in conjunction with the March 13, 2014 financing agreement. The debt
has an interest rate of 8% and the Company received proceeds of $67,750, net of fees, In the event that the original note is not
repaid prior to six months from its issuance, the lender has the option of converting the additional note into shares of the Company’s
common stock at a 40% discount to lowest closing bid price in the 20 trading days prior to conversion, subject to the notes payable
to the Company having been paid in full. In connection with the issuance of the note, the Company computed a premium of $50,000
as the note is considered stock settled debt under ASC 480, all of which was accreted and charged to interest expense in the year
ended December 31, 2014. As of June 30, 2015, the outstanding principal and interest on the note had been converted fully converted
into 99,108 shares of common stock. On October 6, 2014, the
Company borrowed $53,000 with a maturity date of June 1, 2015, pursuant to a financing agreement. Under the agreement the Company
received $50,000, which was net of legal fees. The note bears interest at 8% per annum and is convertible at the option of the
lender into shares of the Company’s common stock at a 39% discount to the price of common shares in the 10 days prior to
conversion. The note might be accelerated if an event of default occurs under the terms of the note, including the Company’s
failure to pay principal and interest when due, certain bankruptcy events or if the Company is delinquent in its SEC filings. In
connection with the issuance of the note, the Company computed a premium of $33,885 as the note is considered stock settled debt
under ASC 480. As |
