Item 2.03. Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registration.
On
September 28, 2017, the Company entered into a Securities Purchase
Agreement with EMA Financial, LLC (“EMA”), pursuant to
which the Company agreed to sell to EMA a 12% Convertible Note for
$55,000 with a maturity date of September 28, 2018 (the
“Note”). EMA has the right, at any time, to convert the
Note into the Company’s common stock, par value $0.0001, at a
conversion price equal to the lower of (i) the closing sale price
of the Company’s common stock on the Closing Date (as
hereafter defined), or (ii) 60% of either the lowest sale price for
the Company’s common stock during the twenty (20) consecutive
trading days including and immediately preceding the Closing Date,
or the closing bid price, whichever is lower (the “Conversion
Price”), provided that, if the price of the Company’s
common stock loses a bid, then the Conversion Price may be reduced,
at EMA’s absolute discretion, to a fixed conversion price of
$0.00001 (“Adjusted Conversion Price”). If at any time
the Adjusted Conversion Price for any conversion would be less than
par value of the Company’s Common Stock, then the Conversion
Price shall equal such par value for any such conversion and the
conversion amount for such conversion shall be increased to include
additional principal to the extent necessary to cause the number of
shares issuable upon conversion equal the same number of shares as
would have been issued had the Conversion Price not been subject to
the minimum par value price. The effective closing date of the
Securities Purchase Agreement and Note is October 17, 2017 (the
“Closing Date”).
The
foregoing does not purport to be a complete description of the Note
and Securities Purchase Agreement, which are qualified in their
entirety by reference to the full text of such documents, which are
filed as Exhibits 10.1 and 10.2, respectively, hereto.
