Legacy Education Alliance, Inc. announced a private placement of 10% convertible debentures for gross proceeds of $250,000 September 13, 2022, and October 3, 2022. The transaction included participation from returning investor, ABCImpact I, LLC. Pursuant to the Debenture, the lender has the option to loan up to an additional $4,200,000 to the Company.

The maturity date of the Debenture is the earlier of 12 months from the issue date and the date of a Liquidity Event (as defined in the Debenture) and is the date upon which the principal and interest shall be due and payable. The Debenture bears interest at a fixed rate of 10% per annum. Any overdue accrued and unpaid interest shall entail a late fee at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted by applicable law, which shall accrue daily from the date such interest is due through and including the date of actual payment in full.

The then outstanding and unpaid principal and interest shall be converted into shares of Company common stock and an equal number of common stock purchase warrants at the option of the lender, at a conversion price per share of $0.05, subject to adjustment pursuant to the terms of the debenture. The company may not prepay the note without the prior written consent of the lender.