Current Report Filing (8-k)
June 09 2021 - 3:36PM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 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 3, 2021
CLUBHOUSE
MEDIA GROUP, INC.
(Exact
name of registrant as specified in its charter)
Nevada
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333-140645
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99-0364697
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(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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3651
Lindell Road, D517
Las
Vegas, Nevada 89103
(Address
of principal executive offices) (Zip code)
(702)
479-3016
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
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 (see General Instruction A.2. below):
[ ]
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)
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[ ]
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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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Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class
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Trading
Symbol(s)
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Name
of each exchange on which registered
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N/A
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N/A
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N/A
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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 [ ]
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. [ ]
Item
1.01 Entry Into A Material Definitive Agreement.
Convertible
Promissory Note – GS Capital Partners
On
June 3, 2021, Clubhouse Media Group, Inc. (the “Company”) entered into a securities purchase agreement (the “Securities
Purchase Agreement”) with GS Capital Partners, LLC (“GS Capital”), pursuant to which, on same date, the Company issued
a convertible promissory note to GS Capital in the aggregate principal amount of $550,000 for a purchase price of $500,000, reflecting
a $50,000 original issue discount (the “June 2021 GS Capital Note”) and, in connection therewith, sold to GS Capital 85,000
shares of the Company’s common stock, par value $0.001 per share (the “Company Common Stock”) at a purchase price of
$85, representing a per share price of $0.001 per share. In addition, at the closing of this sale, the Company reimbursed GS Capital
the sum of $5,000 for GS Capital’s costs in completing the transaction, which amount GS Capital withheld from the total purchase
price paid to the Company.
The
June 2021 GS Capital Note has a maturity date of June 3, 2022 and bears interest at 10% per year. No payments of the principal amount
or interest are due prior to the maturity date other than as specifically set forth in the June 2021 GS Capital Note, and the Company
may prepay all or any portion of the principal amount and any accrued and unpaid interest at any time without penalty.
The
June 2021 GS Capital Note (and the principal amount and any accrued and unpaid interest) is convertible into shares of the Company’s
common stock, par value $0.001 per share (the “Company Common Stock”) at GS Capital’s election at any time following
the time that the SEC qualifies the Company’s offering statement related to the Company’s planned offering of Company Common
Stock pursuant to Regulation A under the Securities Act of 1933, as amended (the “Regulation A Offering”). At such time,
the June 2021 GS Capital Note (and the principal amount and any accrued and unpaid interest) will be convertible at a conversion price
equal to 70% of the initial offering price of the Company Common Stock in the Regulation A Offering, subject to a customary beneficial
ownership limitation of 9.99%, which may be waived by GS Capital on 61 days’ notice to the Company. The conversion price is subject
to customary adjustments for any stock splits, etc. which occur following the determination of the conversion price.
The
June 2021 GS Capital Note contains customary events of default, including, but not limited to:
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if
the Company fails to pay the then-outstanding principal amount and accrued interest on the June 2021 GS Capital Note on any date
any such amounts become due and payable, and any such failure is not cured within three business days of written notice thereof by
GS Capital; or
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the
Company fails to remain compliant with the Depository Trust Company (“DTC”), thus incurring a “chilled” status
with DTC; or
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any
trading suspension is imposed by the SEC under Section 12(j) of the Exchange Act or Section 12(k) of the Exchange Act; or
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the
occurrence of any delisting of the Company Common Stock from any securities exchange on which the Company Common Stock is listed
or suspension of trading of the Company Common Stock on the OTC Markets.
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If
an event of default has occurred and is continuing, GS Capital may declare all or any portion of the then-outstanding principal amount
of the June 2021 GS Capital Note, together with all accrued and unpaid interest thereon, due and payable, and the June 2021 GS Capital
Note shall thereupon become immediately due and payable in cash and GS Capital will also have the right to pursue any other remedies
that GS Capital may have under applicable law. In the event that any amount due under the June 2021 GS Capital Note is not paid as and
when due, such amounts shall accrue interest at the rate of 18% per year, simple interest, non-compounding, until paid.
The
foregoing description of the Securities Purchase Agreement and June 2021 GS Capital Note does not purport to be complete and is qualified
in its entirety by reference to the full texts of the Securities Purchase Agreement and the June 2021 GS Capital Note, copies of which
are filed as Exhibit 10.1 and Exhibit 10.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
As
disclosed in Item 1.01 of this Current Report on Form 8-K, the Company issued the June 2021 GS Capital Note. The disclosure in Item 1.01
hereof concerning this note is incorporated by reference into this Item 2.03.
Item
2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.
As
disclosed in the Company’s Current Report on Form 8-K filed with the SEC on May 5, 2021, on March 11, 2021, the Company entered
into a securities purchase agreement (the “Labrys SPA”) with Labrys Fund, LP (“Labrys”), pursuant to which the
Company issued a 10% promissory note (the “Labrys Note”) with a maturity date of March 11, 2022 (the “Labrys Maturity
Date”), in the principal sum of $1,000,000. Pursuant to the terms of the Labrys Note, the Company agreed to pay to $1,000,000 (the
“Principal Sum”) to Labrys and to pay interest on the principal balance at the rate of 10% per annum.
In
addition, the Labrys Note provides that, if (i) the Labrys Note is still outstanding; and (ii) since the issuance of the Labrys Note,
the Company has received cash proceeds from any source of series of sources of $1,500,000, then Labrys shall have the right to require
the Company to apply up to 50% of any future proceeds received by the Company to repay the outstanding balance of the Labrys Note.
The
Company has now raised over $1,500,000 since the issuance of the Labrys Note on March 11, 2021, and therefore, Labrys has the
right to demand up to 50% of the proceeds received by the Company from the issuance of the June 2021 GS Capital Note –
or $250,000. As of the date of this Current Report on Form 8-K, report, Labrys has not yet made a demand for $250,000 from the Company. If Labrys does make such a demand, the Company intends to pay Labrys from the proceeds of the June 2021 GS Capital Note.
The
foregoing description of the Labrys Note does not purport to be complete and is qualified in its entirety by reference to the full text
of the Labrys Note, a copy of which is filed as Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2020 filed with the SEC on March 15, 2021.
Item
9.01 Financial Statement and Exhibits.
(d)
Exhibits
The
following exhibits are filed or furnished with this Current Report on Form 8-K:
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 thereunto duly authorized.
Date:
June 9, 2021
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CLUBHOUSE
MEDIA GROUP, INC.
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By:
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/s/
Amir Ben-Yohanan
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Amir
Ben-Yohanan
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Chief
Executive Officer
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Clubhouse Media (PK) (USOTC:CMGR)
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