NovAccess Global : Securities Purchase Agreement (Form 8-K)

Entry into a Material Definitive Agreement.

On May 28, 2021, NovAccess Global Inc. ('NovAccess' or the 'company'), entered into a securities purchase agreement (the 'SPA') with Power Up Lending Group Ltd. ('Power Up') and issued a convertible promissory note in the original principal amount of $55,000 (the 'note') to Power Up pursuant to the SPA. NovAccess will use the proceeds of the loan for general working capital purposes.

NovAccess provided typical representations and agreed to standard covenants pursuant to the SPA. The SPA does not include any financial covenants.

The note bears interest at 12% a year and is due on May 28, 2022. NovAccess may prepay the note upon payment of a prepayment penalty ranging from 20-40% of the amount outstanding on the note when prepaid. Under the terms of the note, NovAccess may not sell a significant portion of its assets without the approval of Power Up, must comply with the company's reporting requirements under the Securities Exchange Act of 1934, and must maintain the listing of the company's common stock on the OTC Market or other exchange. NovAccess' failure to comply with any of these covenants, among other matters, would constitute an event of default. Upon an event of default, the note will bear interest at 22% and Power Up will be entitled to its costs of collection.

Beginning on November 24, 2021, Power Up may convert the amount outstanding under the note into shares of NovAccess common stock at a conversion price equal to 61% of the lowest trade price of the stock during the fifteen trading days before the conversion date.

The SPA and note are filed as exhibits to this Current Report on Form 8-K. The descriptions above are qualified in their entirety by reference to the full text of these documents.

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure included under Item 1.01 above is incorporated by reference to this Item 2.03.

Unregistered Sales of Equity Securities.

The disclosure included under Item 1.01 above is incorporated by reference to this Item 3.02. The issuances of the note to Power Up was exempt from registration under Section 4(a)(2) of the Securities Act of 1933.

Financial Statements and Exhibits.

Exhibit 10.1 Securities Purchase Agreement dated May 28, 2021 between NovAccess Global Inc. and Power Up Lending Group Ltd.

Exhibit 10.2 Convertible Promissory Note dated May 28, 2021 in the original principal amount of $55,000 issued by NovAccess Global Inc. to Power Up Lending Group Ltd.