BLOOMIOS, INC. Item 1.01 Entry into a Material Definitive Agreement.
Membership Interest Purchase Agreement
On
Seller also agreed to transfer certain equipment used in connection with operation of the Business and agreed to allow the Company to provide: (i) white label and private label manufacturing services to Seller's customers and (ii) contracted services for certain brands of the Seller that were manufactured by the Seller ((i) and (ii) are referred to collectively herein as the "Assets").
The closing of the purchase of the LLC Interests and the transfer of the Assets
occurred on
The purchase price of the LLC Interests was twenty-three million five hundred
thousand dollars (
As further described below under the heading "Senior Secured Convertible
Debenture Offering, " on
As further described under Item 5.03 of this Current Report on Form 8-K, the
Company filed a Certificate of Designation of Preferences, Rights and
Limitations of Series D Convertible Preferred Stock (the "COD") with the
Secretary of State of the
The non-cash consideration consisted of the issuance by the Company to the
Seller of: (i) a Debenture having a subscription amount of four million five
hundred thousand dollars (
To the extent that the working capital of Infusionz on the Closing Date
is respectively greater than or less than one million
Item 2.01 Completion of Acquisition or Disposition of Assets.
The applicable information regarding the closing of the purchase of the LLC Interests and the transfer of the Assets set forth in Item 1.01 is incorporated by reference herein.
Item 2.03 Creation of Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The applicable information regarding the Debentures and the Note set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference in this Item 2.03.
Item 3.02 Unregistered Sales of
The applicable information regarding the Debentures, the Note, the Warrant, the Series D Preferred Shares set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference in this Item 3.02. The Debentures, the Note, the Warrant, the Underlying Shares, the shares of Common Stock underlying the Note, and the shares of Common Stock underlying Series D Preferred Shares were not registered under the Securities Act, but qualified for exemption under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act") or Rule 506(b) promulgated thereunder. The securities were exempt from registration under Section 4(a)(2) of the Securities Act or Rule 506(b) because the issuance of such securities by the Company did not involve a "public offering," as defined in Section 4(a)(2) of the Securities Act, due to the insubstantial number of persons involved in the transaction and manner of the offering. The Company did not undertake an offering in which it sold securities to a high number of investors. In addition, the Seller and each holder of the Debentures, Warrants, and Underlying Shares had the necessary investment intent as required by Section 4(a)(2) or Rule 506(b) since the Seller and each holder agreed to, and received, the securities bearing a legend stating that such securities are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a "public offering." Based on an analysis of the above factors, the Company has met the requirements to qualify for exemption under Section 4(a)(2) of the Securities Act or Rule 506(b) promulgated thereunder.
Item 3.03 Material Modification to Rights of Security Holders.
The applicable information regarding the Series D Preferred set forth in Item 5.03 of this Current Report on Form 8-K is incorporated by reference in this Item 3.03.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
Although the Company filed the COD with the Secretary of State of the
The Series D Preferred shares entitle the holder to receive dividends equal to eight and one-half percent (8.50%) per annum of the Stated Value of the Series D Preferred shares, on a monthly basis, 30 days in arrears, for each month during which the Series D Preferred shares remain outstanding.
The monthly dividends shall be declared but not become due and payable and shall not be paid (but instead shall accrue) until the date that is three (3) months following the date on which the Debentures are fully repaid and /or converted into shares of Common Stock (such date the "Dividend and Conversion Restriction Release Date"). In addition, no asserted claims, losses or liabilities related to the Debentures to which the holders of the Debentures are entitled to indemnification or reimbursement can remain unresolved. The monthly dividends shall be fully paid in twelve equal monthly installments.
On or after the Dividend and Conversion Restriction Release Date, the holder of the Series D Preferred shares can convert the Series D Preferred shares into shares of Common Stock. The number of shares of Common Stock will equal the product obtained by dividing the number of shares of Series D Preferred Stock being converted by the closing price per share of the Common Stock on the conversion date and multiplying that number by 100.
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The holders of the Series D Preferred shares shall have the same voting rights as the holders of the Common Stock and the shares of Series D Preferred shall vote equally with the shares of Common Stock, and not as a separate class, at any annual or special meeting, upon the following basis: the holder of Series D Preferred shares shall be entitled to cast such number of votes as shall be equal to the aggregate number of shares of Common Stock into which such holder's shares of Series D Preferred Stock are convertible immediately after the close of business on the record date fixed for such meeting.
The Series D Preferred shares have a liquidation preference over all other
Company securities other than the Debentures. In addition, the Company may, in
its sole discretion, on or after one year anniversary of the Closing Date,
subject to whether the Debentures are still outstanding, elect to redeem all or
any portion of the Series D Preferred shares at a price per share equal to
The foregoing summary of the COD contains only a brief description of the material terms of the COD and such description is qualified in its entirety by reference to the full text of the COD, a form of which is filed herewith as Exhibit 3.1.
Item 8.01. Other Events.
On
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Businesses Acquired:
The Company will file financial statements as required under Regulation S-X for Infusionz by amendment to this Current Report on Form 8-K.
(b) Pro Forma Financial Information.
The Company will file pro-forma financial information as required under Regulation S-X for Infusionz by amendment to this Current Report on Form 8-K.
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(d) Exhibits.
Exhibit Incorporated by Reference Filed
Number Exhibit Description Form Date Number Herewith
Membership Interest Purchase
2.1# Agreement by and among Bloomios, Inc., ?
Upexi, Inc., and Infused Confections
LLC, dated as October 26, 2022
Form of Certificate of Designation of
3.1 Preferences, Rights and Limitations of ?
Series D Convertible Preferred Stock
Form of 15% OID Senior Secured
4.1 Convertible Debentures issued October ?
26, 2022
4.2 Form of Warrant issued to Debenture ?
Holders, dated October 26, 2022
Convertible Secured Subordinated
4.3 Promissory Note issued by Bloomios, ?
Inc. to Upexi, Inc., dated October 26,
2022
Transition Services Agreement by and
10.1* between Bloomios, Inc., and Upexi, ?
Inc., dated October 26, 2022
Form of Securities Purchase Agreement
10.2 for Debentures Offering, dated October ?
26, 2022
Form of Security Agreement for
10.3# Debentures Offering, dated October 26, ?
2022
Pledge and Security Agreement by and
10.4 between Infusionz LLC and Upexi, Inc., ?
dated October 26, 2022
99.1 Bloomios, Inc. Press Release, dated ?
October 27, 2022
Cover Page Interactive Data File
104 (embedded within the Inline XBRL ?
document).
# Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of
Regulation S-K.
* Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of
Regulation S-K because such information is (i) not material and (ii) would
likely be competitively harmful if publicly disclosed. The Company will furnish
supplementally an unredacted copy of such exhibit to the
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