Fuse Science, Inc. (OTCPK:DROP) announced a private placement of 10% senior secured convertible promissory notes for gross proceeds of $700,000 on November 7, 2013. The company will also issue 23,331,000 warrants at an initial exercise price of $0.06 per share for a five year period after closing. The notes bears interest at 10% per year, and accrues and is payable together with principal on the 60 day after closing. The notes may be converted, at the option of the holder, into the company's common shares at any time following issuance at an exercise price of $0.065 per share or if the company consummates a subsequent financing generating gross proceeds of not less than $4,000,000 into the securities sold in the subsequent financing at a specified discount from the offering price of such securities. The notes are secured by a first lien on substantially all of company's assets pursuant to a pledge and security agreement among the parties. The transaction will include participation from a group of investors including new investor MusclePharm Corporation, Barry Honig, Michael Brauser, new investor Melechdavid, Inc., new investor Frost Gama Investments Trust, Jonathan Manela, and Brian Tuffin, Chief Executive Officer of the company who will purchase noted for gross proceeds of $15,000. Dawson James Securities will act as the placement agent to the company. The company will pay a placement agent fee of $43,400 to Dawson James Securities and will also issue to Dawson James Securities and their respective designees, placement agent warrants for purchasing 7% of the number of common shares that are issuable pursuant to the notes and warrants. Pedro G. Menocal of Gutiérrez Yelin & Boulris, PLLC and Dale S. Bergman of Roetzel & Andress will act as the legal advisor to the company. Harvey Kesner of Sichenzia Ross Friedman Ference LLP will act as the legal advisor to the investors. The transaction is scheduled to close on or about November 8, 2013. The company shall be responsible for the payment of all fees and expenses in connection with the transactions contemplated in this agreement and the transaction documents, including, without limitation, the fees and out-of-pocket expenses of Sichenzia Ross Friedman Ference LLP, incurred in connection with the preparation and negotiation of the transaction documents. Such fees and expenses shall be paid from the escrow account at the time of closing. The company will issue securities pursuant to exemption provided under Regulation D.

On November 8, 2013, Fuse Science, Inc. closed the transaction. The transaction included participation from seven investors. As part of the transaction, the company paid sales commissions to Dawson James Securities Inc. with a 5% warrant coverage.