Item 1.01. Entry into a Material Definitive Agreement.
Cavalry Exchange Agreement
On
Pursuant to the Calvary Exchange Agreement, Cavalry shall exchange (the "Cavalry Exchange") (a) 1,000,000 shares of the Company's Series C Convertible Preferred Stock (the "Series C Shares"), (b) 750,000 shares of the Company's Series D Convertible Preferred Stock (the "Series D Shares"), and (c) amounts owing under the Cavalry Note, for a number of Series E Convertible Preferred Stock (the "Series E Shares") equal to 150% of the principal amount of the Cavalry Note, plus 150% of the stated value of the Series C Shares and Series D Shares (the "Series E Exchange Value").
The Cavalry Exchange shall occur on the date of the Company's listing of its common stock on a national securities exchange. Cavalry shall surrender to the Company the Series C Shares and Series D Shares owned by it and as well as the Cavalry Note. Upon such surrender, the Company shall issue to Cavalry a number of Series E Shares equal to the Series E Exchange Value.
Cavalry Promissory Note
The maturity date of the Cavalry Note is
If and only if the Cavalry Principal Amount is not converted into Series E Shares pursuant to the term of the Cavalry Note, the unpaid Cavalry Principal Amount shall bear interest at 10% per annum, which interest shall be accrued on a monthly basis and which shall have been deemed to have been accruing from the issue date of the Cavalry Note. Following an event of default, as defined in the Cavalry Note, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18%.
The Cavalry Note contains a "most favored nations" clause that provides that, so long as the Cavalry Note is outstanding, if the Company issues any new security, which Cavalry reasonably believes contains a term that is more favorable than those in the Cavalry Note, the Company shall notify Cavalry of such term, and such term, at the option of Cavalry, shall become a part of the Cavalry Note.
Mercer Exchange Agreement
On
Pursuant to the Mercer Exchange Agreement, Mercer shall exchange (the "Mercer Exchange") (a) 47,619 shares of the Company's Series C Convertible Preferred Stock (the "Series C Shares"), (b) 750,000 shares of the Company's Series D Convertible Preferred Stock (the "Series D Shares"), and (c) amounts owing under the Mercer Note, for a number of Series E Convertible Preferred Stock (the "Series E Shares") equal to 150% of the principal amount of the Mercer Note, plus 150% of the stated value of the Series C Shares and Series D Shares (the "Series E Exchange Value").
The Mercer Exchange shall occur on the date of the Company's listing of its common stock on a national securities exchange. Mercer shall surrender to the Company the Series C Shares and Series D Shares owned by it and as well as the Mercer Note. Upon such surrender, the Company shall issue to Mercer a number of Series E Shares equal to the Series E Exchange Value.
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Mercer Promissory Note
The maturity date of the Mercer Note is
If and only if the Mercer Principal Amount is not converted into Series E Shares pursuant to the term of the Mercer Note, the unpaid Mercer Principal Amount shall bear interest at 10% per annum, which interest shall be accrued on a monthly basis and which shall have been deemed to have been accruing from the issue date of the Mercer Note. Following an event of default, as defined in the Mercer Note, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18%.
The Mercer Note contains a "most favored nations" clause that provides that, so long as the Mercer Note is outstanding, if the Company issues any new security, which Mercer reasonably believes contains a term that is more favorable than those in the Mercer Note, the Company shall notify Mercer of such term, and such term, at the option of Mercer, shall become a part of the Mercer Note.
Pinz Exchange Agreement
On
Pursuant to the Pinz Exchange Agreement, Pinz shall exchange (the "Pinz Exchange") (a) 100,000 shares of the Company's Series D Convertible Preferred Stock (the "Series D Shares"), and (b) amounts owing under the Pinz Note, for a number of Series E Convertible Preferred Stock (the "Series E Shares") equal to 150% of the principal amount of the Pinz Note, plus 150% of the stated value of the Series D Shares (the "Series E Exchange Value").
The Pinz Exchange shall occur on the date of the Company's listing of its common stock on a national securities exchange. Pinz shall surrender to the Company the Series D Shares owned by it and as well as the Pinz Note. Upon such surrender, the Company shall issue to Pinz a number of Series E Shares equal to the Series E Exchange Value.
Pinz Promissory Note
The maturity date of the Pinz Note is
Item 3.02. Unregistered Sales of
To the extent required by this Item 3.02, the information contained in Item 1.01 is incorporated herein by reference.
Item 3.03. Material Modification to Rights of Security Holders.
To the extent required by this Item 3.03, the information contained in Item 1.01 is incorporated herein by reference.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On
The foregoing description of the Certificate of Correction does not purport to be complete and is qualified in its entirety by reference to the Certificate of Correction, a copy which is filed as Exhibit 3.1, to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits Exhibit No. Description 3.1* State of Delaware Certificate of Correction datedOctober 4, 2022 4.1* Form Promissory Note datedOctober 7, 2022 10.1* Form Exchange Agreement, datedOctober 7, 2022 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). * Filed herewith.
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