ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OF A REGISTRANT
In February, 2021,
The Note is convertible into shares of common stock at a conversion price equal to 90% of the lowest trading price of the common stock during the 20 Trading Days immediately preceding the conversion. The conversion price is subject to adjustment under certain circumstances.
ITEM 7.01 REGULATION FD DISCLOSURE
The following sets forth the information required by Item 701 of Regulation S-K
with respect to the unregistered sales of equity securities by
a. In February, 2021, the Company sold a 10% Convertible Promissory Note in the
principal amount of$200,000 as described in Item 2.03 above. The Company also issued to the investor an aggregate of 266,667 shares of common stock as a commitment fee (the "CommitmentFee Shares ").
b. The Note and Commitment
sold to one (1) investor who qualified as an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the Securities Act of 1933 as amended (the "Securities Act").
c. The Company paid no fees or commissions in connection with the issuance of the
Securities.
d. The issuance of the Securities was undertaken without registration under the
Securities Act in reliance upon an exemption from the registration requirements of the Securities Act set forth in Rule 506(b) of Regulation D and Section 4(2) thereunder. The investors each qualified as an "accredited investor" within the meaning of Rule 501(a) of Regulation D. In addition, the Securities, which were taken for investment purposes and not for resale, were subject to restrictions on transfer. We did not engage in any public advertising or general solicitation in connection with this transaction, and we provided the investor with disclosure of all aspects of our business, including providing the investor with our reports filed with theSecurities and Exchange Commission and other financial, business and corporate information. Based on our investigation, we believed that the accredited investors obtained all information regarding the Company that each requested, received answers to all questions posed and otherwise understood the risks of accepting our Securities for investment purposes.
e. The terms of conversion of the Note are set forth in the form Note filed
herewith. f. Not applicable.
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