Current Report Filing (8-k)
June 13 2017 - 11:30AM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of report (Date of earliest event reported): June 13, 2017 (June 7, 2017)
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COATES
INTERNATIONAL, LTD.
(Exact name
of registrant as specified in its charter)
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Delaware
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000-33155
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22-2925432
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(State
or Other Jurisdiction
of Incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification No.)
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Highway
34 & Ridgewood Road, Wall Township, New Jersey 07719
(Address
of principal executive offices)
(732)
449-7717
(Registrant's telephone number including area code)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
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☐
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
o
If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act.
o
FORWARD
LOOKING STATEMENTS
This
Form 8-K and other reports filed by Registrant from time to time with the Securities and Exchange Commission (collectively the
"Filings") contain or may contain forward looking statements and information that are based upon beliefs of, and information
currently available to, Registrant's management as well as estimates and assumptions made by Registrant's management. When used
in the filings the words "anticipate", "believe", "estimate", "expect", "future",
"intend", "plan" or the negative of these terms and similar expressions as they relate to Registrant or Registrant's
management identify forward looking statements. Such statements reflect the current view of Registrant with respect to future
events and are subject to risks, uncertainties, assumptions and other factors relating to Registrant's industry, Registrant's
operations and results of operations and any businesses that may be acquired by Registrant. Should one or more of these risks
or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from
those anticipated, believed, estimated, expected, intended or planned.
Although
Registrant believes that the expectations reflected in the forward looking statements are reasonable, Registrant cannot guarantee
future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities
laws of the United States, Registrant does not intend to update any of the forward-looking statements to conform these statements
to actual results.
ITEM
2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
On
June 7, 2017, the Registrant entered into a 9.75% convertible note facility agreement (the “Agreement”) with an
investor. The Agreement provides that the investor will fund up to $369,000, including an initial tranche of $55,000, which was
funded at the closing of the Agreement and twelve additional tranches of $26,250 each. All tranches mature 17 months after the
date of the Agreement. The Agreement provides that the entire outstanding balance under the Agreement, along with a required 25%
prepayment penalty, may be paid to the investor at the option of the Registrant, in whole, at any time. The investor may convert
the remaining outstanding balance of convertible notes in whole, or in part, at any time beginning six months after funding, into
shares of the Registrant’s common stock. The Registrant may, at its option, pay all or any portion of a note conversion
in cash, or a combination of cash and conversion shares, without penalty, provided it makes a timely election to do so. The number
of shares of common stock to be initially delivered upon conversion shall be equal to the dollar amount being converted divided
by the variable conversion price. The variable conversion price is the lesser of $0.01 per share, or 70% of the average of the
three lowest daily volume weighted average prices (“VWAP”) over the 15 trading day period prior to the date of conversion.
The number of shares of the Registrant’s common stock required to be issued to the investor upon any conversion may be subsequently
adjusted upward in the event that the recalculated variable conversion price on the 23rd trading day following the date of conversion
is lower than the calculated variable conversion price on the date of conversion. In such case, the Registrant would be required
to deliver the incremental number of shares to the investor, determined based on the recalculated variable conversion price. The
Registrant has reserved 50 million shares of its unissued common stock for potential conversion of the convertible notes under
this convertible note facility.
The
investor anticipates that upon any conversion, the shares of stock it receives from the Registrant will be freely tradable in
compliance with Rule 144 of the U.S. Securities and Exchange Commission.
The
convertible promissory note was privately offered and sold to the Holder in reliance on specific exemptions from the registration
requirements of the United States federal and state securities laws which the Registrant believes are available to cover this
transaction based on representations, warranties, agreements, acknowledgements and understandings provided to the Registrant by
the investor.
ITEM
9.01 FINANCIAL STATEMENT AND EXHIBITS.
(a)
Financial Statements of Business Acquired.
N/A
(b)
Pro Forma Financial Information.
N/A
(c)
Exhibits.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf
by the undersigned hereunto duly authorized.
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COATES INTERNATIONAL, LTD.
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By:
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/s/ Barry C. Kaye
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Barry C. Kaye
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Chief Financial Officer
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Dated: June 13, 2017
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