Item
1.01 Entry into a Material Definitive Agreement.
Securities
Purchase Agreement with EMA Financial, LLC
On June 29, 2021 (the “Effective Date”), RespireRx Pharmaceuticals
Inc. (the “Company”) and EMA Financial, LLC (“EMA”) entered into a Securities Purchase Agreement (the “SPA”)
pursuant to which EMA provided a sum of $103,500 (the “Consideration”) to the Company, in return for a convertible promissory
note (the “Note”) with a face amount of $115,000 (which difference in value as compared to the Consideration is due to an
original issue discount of $11,500), and a common stock purchase warrant (the “Warrant”) exercisable for five years at an
exercise price of $0.02 per share on a cash or cashless basis, to purchase up to 2,453,333 shares of the Company’s common stock,
par value $0.001 (“Common Stock”). In addition, and to induce EMA to enter into the SPA, the Company and EMA entered into
a Piggy-Back Registration Rights Agreement (the “Registration Rights Agreement”) under which the Company has agreed to provide
certain piggy-back registration rights under the Securities Act of 1933, as amended (the “Securities Act”) with respect to
the Common Stock issuable pursuant to the SPA. The net proceeds of the Consideration, which were received by the Company on June 30, 2021,
were used for general corporate purposes, including the payment of accrued obligations, and equaled $100,000 after payment of $2,750 in
EMA’s legal fees and the withholding by EMA of $750 in diligence fees.
The
Note obligates the Company to pay by June 29, 2022 (the “Maturity Date”) a principal amount of $115,000 together with interest
at a rate equal to 10% per annum. The first twelve months of interest, equal to $11,500, is guaranteed and earned in full as of the Effective
Date. Any amount of principal or interest that is not paid by the Maturity Date would bear interest at the rate of 24% from the Maturity
Date to the date it is paid.
EMA
has the right, in its discretion, at any time, to convert any outstanding and unpaid amount of the Note into shares of Common Stock,
provided that the conversion would not result in EMA beneficially owning more than 4.99% of the Company’s then outstanding Common
Stock. EMA may convert at a per share conversion price equal to $0.02, subject to equitable adjustments for stock splits, stock dividends,
combinations, recapitalizations, extraordinary distributions and similar events. Upon any conversion, all rights with respect to the
portion of the Note being so converted will terminate, except for the right to receive Common Stock or other securities, cash or other
assets as provided for in the Note.
The
Company may, in the absence of an Event of Default (as defined in the Note), and with prior written notice to EMA, prepay the outstanding
principal amount under the Note during the initial 180 day period after the Effective Date by making a payment to EMA of an amount in
cash equal to 115% of the outstanding principal, interest, default interest and other amounts owed. Under certain circumstances, including
the occurrence of an Event of Default, a sale, merger or other business combination where the Company is not the survivor, or the conveyance
or disposition of all or substantially all of the assets of the Company, the Company may be required to prepay in cash an amount equal
to 125% of the outstanding principal, interest, default interest and other amounts owed. The Company’s wholly owned subsidiary,
Pier Pharmaceuticals, Inc., provided an unlimited guarantee of the Company’s obligations under the Note.
The
Note requires that the Company reserve the greater of (i) 8,625,000 shares of Common Stock or (ii) one and a half times the number of
shares into which the Note may convert. The Warrant requires that the Company reserve three times the number of shares into which the
Warrant is at any time exercisable.
The
SPA includes, among other things: (1) the grant of an option to EMA to incorporate into the Note any terms applicable to a subsequent
issuance of a convertible note or security by the Company that are more beneficial to an investor than the terms of the SPA and Note
are to EMA; and (2) certain registration rights by reference to the Registration Rights Agreement, and the right to have any shares of
Common Stock issued in connection with the conversion of the Note or exercise of the Warrant included in any Regulation A offering statement
that the Company files with the Securities and Exchange Commission.
The
Note, the Warrant, and the shares of Common Stock issuable upon conversion or exercise thereof, as applicable, were offered and sold
to EMA in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws, which
include Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506 of Regulation D promulgated
thereunder. Pursuant to these exemptions, EMA represented to the Company under the SPA, among other representations, that it was an “accredited
investor” as that term is defined in Rule 501(a) of Regulation D under the 1933 Act.
The
descriptions of the SPA, the Registration Rights Agreement, the Note, and the Warrant do not purport to be complete and are qualified
in their entirety by reference to the SPA, the Registration Rights Agreement, the Note, and the Warrant, which are included as Exhibits
99.1, 99.2, 99.3, and 99.4, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
Exchange
Agreements with EMA Financial, LLC and FirstFire Global Opportunities Fund LLC
The Company has entered into two separately negotiated exchange agreements
with each of EMA (such agreement, the “EMA Exchange Agreement”) and FirstFire Global Opportunities Fund LLC (“FirstFire”
and such agreement, the “FirstFire Exchange Agreement” and together with the EMA Exchange Agreement, the “Exchange Agreements”).
Prior to the execution of the Exchange Agreements the Company had issued each of EMA and FirstFire common stock purchase warrants. On
July 30, 2020, the Company issued to EMA a common stock purchase warrant exercisable until September 30, 2023 at an initial exercise price
of $0.007 per share on a cash basis, to purchase up to 3,750,000 shares of Common Stock (the “Existing EMA Warrant”). On July
2, 2020, the Company issued to FirstFire a common stock purchase warrant exercisable until September 30, 2023 at an initial exercise price
of $0.007 per share on a cash basis, to purchase up to 6,875,000 shares of Common Stock (the “Existing FirstFire Warrant”).
On January 5, 2021, the Company effected a ten-to-one reverse stock split which had the effect of reducing the number of shares into which
the Existing EMA Warrant and the Existing FirstFire Warrant would be exercisable, in each case, by dividing the number of shares by ten
and increasing the exercise price by multiplying the exercise price by ten.
On June 29, 2021, the Company and EMA entered into the EMA Exchange Agreement,
dated as of June 28, 2021, and pursuant to its terms, EMA exchanged the Existing EMA Warrant for a new common stock purchase warrant exercisable
(on a cash or cashless basis) for five years at an initial exercise price of $0.02 per share, to purchase up to 327,273 shares of Common
Stock (the “New EMA Warrant”).
On June 30, 2021, the Company and FirstFire entered into the FirstFire
Exchange Agreement and pursuant to its terms, FirstFire exchanged the Existing FirstFire Warrant for a new common stock purchase warrant
exercisable (on a cash or cashless basis) until September 30, 2023 at an initial exercise price of $0.02 per share, to purchase up to
600,000 shares of Common Stock (the “New FirstFire Warrant”).
Before
entering into the Exchange Agreements, the Company received from certain counterparties to existing agreements requisite waivers of provisions
that prohibit the Company’s entry into transactions in accordance with, based upon, or related or pursuant to Section 3(a)(9) of
the Securities Act.
The
descriptions of the EMA Exchange Agreement, the New EMA Warrant, the Existing EMA Warrant, the FirstFire Exchange Agreement, the New
FirstFire Warrant, and the Existing FirstFire Warrant do not purport to be complete and are qualified in their entirety by reference
to each exchange agreement or warrant, as applicable, copies of which are attached to this Current Report on Form 8-K as Exhibit 99.5,
Exhibit 99.6, Exhibit 99.7, Exhibit 99.8, Exhibit 99.9, and Exhibit 99.10, respectively. The information set forth in Item 3.02 herein
is incorporated into this Item 1.01 by reference.