On May 27th, 2022 the Company entered into a Securities Purchase Agreement (the “Mast Hill Purchase Agreement”), with Mast Hill Fund, LP (“Mast Hill”), primarily to repay the November / December 2021 Notes with Talos Victory Funds, LP (“Talos”) and FirstFire Global Opportunities Fund, LLC (“FirstFire”), leaving Mast Hill, Fourth Man and Blue Lake Partners as the only note holders. For this the Company issued a convertible promissory note in the aggregate principal amount of $605,000 (the ‘Mast Hill Note”). After the repayment of the Talos and Firstfire notes and retirement of their respective notes, the Company has Mast Hill, Fourth Man LLC and Blue Lake Partners, LLC as remaining debt holders under the November / December 2021 Financing. The Mast Hill Note is convertible into shares of the Company’s common stock, par value $0.01 per share (“Common Stock”). Part of the funds generated from the notes were utilized to pay off Talos on June 1, 2022 and First Fire). As of June 2, 2022, both notes with Talos and Firstfire have been repaid.

The Purchase Agreement and the Note were entered into for aggregate gross proceeds to the Company of up to $0.25 million (the “Financing”), undertaken by the Company pursuant to that certain Finder’s Fee Agreement between the Company and JH Darbie & Co., Inc. (“JH Darbie”), dated October 26, 2021 (the “Agreement”). Pursuant to the Agreement, JH Darbie will be entitled to a finder’s fee of: (a) 10% of the gross proceeds received by the Company in cash; and (b) warrants equal 10% warrant coverage of the amount raised, with a purchase price equal to the Conversion Price, with such warrants to expire five years from the date of issuance. The Purchase Agreement and the Note contain identical terms to the securities purchase agreements (and promissory notes issued thereunder), to Talos Victory Fund, LLC on November 24, 2021 and Mast Hill Fund, LP on November 30, 2021 (the “Prior Issuances”), except with reference to the name of the holders, the use of proceeds, which included repayment of certain debt, general corporate expenses and payroll, as applicable, and the law governing the terms of the Prior Issuances. The Prior Issuances were previously reported on our Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on December 1, 2021.

The Notes carry an interest rate of 12% per annum and matures on the earlier of (a) the one-year anniversary of the date of the Purchase Agreements, or (b) the acceleration of the maturity of the Notes by the applicable holder upon occurrence of an Event of Default (as defined below). The Notes contain a voluntary conversion mechanism whereby the applicable holder may convert the outstanding principal and accrued interest under the terms of the Notes into shares of Common Stock (the “Conversion Shares”), at a fixed price of $0.10 per share (the “Conversion Price”), subject to adjustments upon the occurrence of certain corporate events. The Company also issued 3,025,000 warrants to purchase shares of Common Stock of the Company at an exercise price of $0.20. Prepayment of the Notes may be made at any time upon three trading days’ prior written notice to the respective holder, by payment of the then outstanding principal amount plus accrued and unpaid interest and reimbursement of such holder’s administrative fees. The Notes contains customary events of default (each an “Event of Default”). If an Event of Default occurs, at the respective holder’s election, the outstanding principal amount of the Notes, plus accrued but unpaid interest, will become immediately due and payable in cash. The Purchase Agreements require the Company to use the proceeds for general working capital, and not for (i) the repayment of any indebtedness owed to officers, directors or employees of the Company or their affiliates, (iii) any loan to or investment in any other corporation, partnership, enterprise or other person (except in connection with the Company’s currently existing operations), (iv) any loan, credit, or advance to any officers, directors, employees, or affiliates of the Company, or (v) in violation or contravention of any applicable law, rule or regulation.

The issuance of the Notes are exempt from the registration requirements of the Securities Act of 1933, as amended (“Securities Act”), in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act. The shares of Common Stock issuable upon conversion of the Notes have not been registered under the Securities Act or any other applicable securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act.

The foregoing descriptions of the Purchase Agreements and the Notes are qualified in their entirety by reference to the full text of the form of such agreements, copies of which were attached as Exhibit 10.1 and 10.2, respectively, and the Agreement, attached as Exhibit 10.3, with our Current Report on form 8-K filed with the SEC on December 1, 2021 and each of which is incorporated herein in its entirety by reference.