Item
1.01 Entry into a Material Definitive Agreement.
On
December 19, 2019, Biotricity, Inc. (the “Company”) entered into a Securities Purchase Agreement with one accredited
investor. Pursuant to the SPA, the company sold 6,000 Shares of its Series A convertible Preferred Stock at a per share price
of$1,000 per preferred share and received gross proceeds of $6,000,000.
The Company is submitting with the Secretary
of State of Nevada a Certificate of Designation of Rights, Powers, Preferences, Privileges and Restrictions of Series A Convertible
Preferred Stock (the “Certificate of Designations) with the Sectary of State of the State of Nevada. A form of the Certificate
of Designations is attached hereto as Exhibit 3.1.
Pursuant
to the Certificate of Designations the Company designated 20,000 shares of preferred stock as Series A Convertible Preferred Stock
(the “Series A Preferred”). The Series A Preferred will not be entitled to any voting rights except as may be required
by applicable law.
Commencing
24 months after the issuance date of the Series A Preferred subject to the beneficial ownership limitations in the Certificate
of Designations and the Company’s right of redemption, and the holder of Series A Preferred may convert the Series A Preferred
into shares of the Company’s common stock on a monthly basis up to 5% of the aggregate amount of the e aggregate amount
of the purchase price of the Series A Convertible Preferred purchased by such Holder as adjusted (reduced) to reflect any Series
A Convertible Preferred that the Holder has previously converted or no longer owns at a conversion price equal to the greater
of $.001 or a 15% discount to the VWAP (as defined herein) for the (Company’s Common Stock) five Trading Days immediately
prior to the conversion date (the “Conversion Rate”). Additionally, the Company and the Holder may agree to exchange
such Holder’s outstanding Preferred Shares for shares of common stock in any common stock financing being conducted by the
Company at a 15% discount to the pricing of that financing. Except as required by law the Preferred Shares shall not have any
liquidation rights.
From
and after the first date of issuance of any Preferred Shares (the “Initial Issuance Date”), dividends shall be paid
at the rate of 12% per annum of the amount of the Holder’s (each a “Holder” and collectively the “Holders”)
purchase price for the Preferred Shares pursuant to the Securities Purchase Agreement (or similar agreement) between the Company
and the Purchaser as adjusted (reduced) to reflect any Series Convertible Preferred That the Holder has previously converted or
no longer owns and such dividend shall be paid quarterly provided that the Holder and the Company may mutually agree to accrue
and defer any such dividend
The
Company may redeem all or part of the outstanding Preferred Shares (i) pursuant to Section 4(c) and/or (ii) after one year from
the date of issuance of such Preferred Shares, by paying an amount equal to the aggregate purchase price paid by the Holder for
the Preferred Shares as adjusted (reduced) to reflect any Preferred Shares that the Holder no longer owns multiplied by 110% plus
accrued dividends. The Company may exercise its right to redemption by giving notice to the Holders whose Preferred Shares it
is seeking to redeem along with the terms and the amounts of such redemption and at such time as the Holder receives a notice
of such redemption then the Holder may no longer convert such Preferred Shares and such Preferred Shares shall be deemed to no
longer be outstanding.
The
Series A Convertible Preferred were offered and sold pursuant to an exemption from the registration requirements under Section
4(a)(2) of the Securities Act since, among other things, the transactions did not involve a public offering.
Under
the Certificate of Designations no time may all or a portion of the Series A Convertible Preferred Stock be converted if the number
of shares of Common Stock to be issued pursuant to such conversion would exceed, when aggregated with all other shares of Common
Stock owned by the Holder at such time, the number of shares of Common Stock that would result in the Holder beneficially owning
(as determined in accordance with Section 13(d) of the 1934 Act and the rules thereunder) more than 4.99% of all of the Common
Stock outstanding at such time (the “4.99% Beneficial Ownership Limitation”); provided, however, that,
upon the Holder providing the Company with sixty-one (61) days’ advance notice (the “4.99% Waiver Notice”) that
the Holder would like to waive this Section 4(e) with regard to any or all shares of Common Stock issuable upon conversion of
the Preferred Shares, this Section 4(e) will be of no force or effect with regard to all or a portion of the Series A Convertible
Preferred Stock referenced in the 4.99% Waiver Notice but shall in no event waive the 9.99% Beneficial Ownership Limitation.
Copies of the forms of the Securities Purchase
Agreement and Certificate of Designations are attached hereto as exhibits to this Current Report. The foregoing description of
the material terms of the Securities Purchase Agreement and Certificate of Designations are qualified in their entirety by reference
by such exhibits.