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Item
1.01
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Entry
into a Material Definitive Agreement.
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Equity
Offering
On
August 30, 2019, the Company entered into a Securities Purchase Agreement with the investor parties thereto (collectively, the
“Equity Investors”), pursuant to which the Equity Investors agreed to purchase, severally and not jointly, approximately
$1,067,500 worth of units of the Company, each unit comprised of one (1) share of common stock, $0.001 par value
per share (“Common Stock”), and a Warrant to purchase one (1) share of Common Stock (the “Equity Offering”).
In connection with the Equity Offering, the Company entered into a Registration Rights Agreement, pursuant to which the Company
agreed to file a registration statement on Form S-1 to register the resale of the shares issuable to the Equity Investors in the
Equity Offering.
Copies
of the Security Purchase Agreement, Warrant, and Registration Rights Agreement in connection with the Equity Offering are attached
hereto as Exhibits 10.1 and 10.2, and 4.1, respectively, and are incorporated herein by reference.
Debt
Offering
On
August 30, 2019, the Company entered into a Securities Purchase Agreement with the investor parties thereto (collectively, the
“Debt Investors”) pursuant to which the Debt Investors agreed to purchase, severally and not jointly, (i) original
issue discount Senior Secured Convertible Notes (the “Notes”), issued at a 10% original issue discount, for a total
purchase price of $2,222,854, and (ii) 987,940 Warrants, which are equal to 100% of the shares issuable upon conversion
of the Notes (the “Debt Offering”). In connection with the Debt Offering, the Company entered into a Registration
Rights Agreement, pursuant to which the Company agreed to file a registration statement on Form S-1 to register the resale of
the shares issuable to the Debt Investors in the Debt Offering.
Pursuant
to the Notes, the Company promises to pay the principal sum of the Notes to the respective Debt Investor, or its permitted assigns
(the “Holder”), on the date that is the 15 month anniversary of the original issue date, or November 30, 2020 (the
“Maturity Date”) or such earlier date as the Note is required or permitted to be repaid as provided thereunder, and
to pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of the Note in accordance with
the provisions thereof. Interest shall accrue to the Holders on the aggregate unconverted and then outstanding principal amount
of the Notes at the rate of 10% per annum, calculated on the basis of a 360-day year and shall accrue daily commencing on the
original issue date until payment in full of the outstanding principal (or conversion to the extent applicable), together with
all accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Commencing
on the four month anniversary of the Note, monthly payments of interest and monthly principal payments, based on a 12 month amortization
schedule (each, an “Amortization Payment”), are due and payable, until the Maturity Date, at which time all outstanding
principal, accrued and unpaid interest and all other amounts due and payable under the Note shall be immediately due and payable.
The Amortization Payments are to be made in cash unless the Holder requests it to be issued in the Company’s Common Stock
in lieu of a cash payment (“Stock Payment”). If the Holder requests a Stock Payment, the number of shares of Common
Stock will be issued in an amount as provided in the Note. After the original issue date until the Notes are no longer outstanding,
the Notes shall be convertible, in whole or in part, at any time, and from time to time, into shares of Common Stock at the option
of the Holder. The conversion price in effect is $2.50 per share, subject to adjustment as provided in the Notes.
Copies
of the Securities Purchase Agreement, Note, Warrant, and Registration Rights Agreement in connection with the Debt Offering are
attached hereto as Exhibits 10.3, 10.4, 10.5, and 4.2, respectively, and are incorporated herein by reference.