Item 1.01 Entry into a Material Definitive Agreement.
On
The Investors purchased a total of 1,000 units and the Company issued Debentures
for the total principal amount of
The Debentures mature three years from their date of issuance and bear interest
at a rate of 12% per annum compounded annually and payable on the maturity date.
Each Debenture is convertible, at the option of the holder, at any time, into
such number of shares of common stock of the Company equal to the principal
amount of the Debenture plus all accrued and unpaid interest at a price equal to
the volume weighted average price per share (calculated to the nearest
one-hundredth of
In addition, the Company may accelerate this right of conversion on at least ten (10) business days prior written notice to the Holder if there is an effective Registration Statement registering, or a current prospectus available for, the resale of the common shares issuable on the conversion and (i) the closing price of the Company's common shares exceeds two hundred (200%) per cent of the Conversion Price for five (5) trading days in a thirty (30) day period or (ii) the Company wishes to redeem or pre-pay the Debentures prior to the Maturity Date.
If at any time that the common shares issuable to the Investors on conversion of the Debenture in whole or in part would be free trading without resale restrictions or statutory hold periods, the Debenture is redeemable by the Company at any time or times prior to the Maturity Date on not less than ten (10) Business Days prior written notice from the Company to the Investor of the proposed date of Redemption (the "Redemption Date"), without bonus or penalty, provided, however, that prior to the Redemption Date, the Investor has the right to convert the whole or any part of the principal and accrued and unpaid interest of the Debenture into common shares of the Company.
The warrants are exercisable at an exercise price equal to the volume weighted
average price per share (calculated to the nearest one-hundredth of
The Company may accelerate the right to exercise the Warrant on at least ten (10) business days prior written notice to the Holder if there is an effective Registration Statement registering, or a current prospectus available for, the resale of the common shares issuable on exercise of the Warrant and the closing price of the Company's common shares exceeds two hundred (200%) per cent of the Exercise Price for five (5) trading days in a thirty (30) day period.
The Company paid no finders fees in connection with the subscriptions.
The foregoing descriptions of the Subscription Agreement, Debenture and Warrant are qualified in their entirety by reference to the full text of the forms of Subscription Agreement, Debenture and Warrant, copies of each of which are attached hereto as Exhibits 10.1, 10.2 and 10.3, respectively.
Item 2.03 - Creation of Direct Financial Obligation
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 3.02 - Unregistered Sales of
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
The Debentures and Warrants were issued pursuant to an exemption from
registration under Section 4(a)(2) of the Securities Act of 1933, as amended and
Rule 506 of Regulation D promulgated thereunder (the "Securities Act") and
therefore are not registered under the Securities Act or the securities laws of
any state of
Item 9.01. Financial Statements and Exhibits. (d)Exhibits.
The following exhibits are filed with this Current Report on Form 8-K.
Exhibit Number Exhibit Description 10.1 Form of Subscription Document between the Company and the Investors 10.2 Form of Debenture 10.3 Form of Warrant 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
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