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Item 1.01
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Entry into a Material Definitive Agreement.
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GW Holdings Financing
On August 12, 2019, NanoFlex Power Corporation,
a Florida corporation (the “Company”) entered into a Securities Purchase Agreement (the “GW SPA”) with
GW Holdings Group, LLC (“GW”) pursuant to which GW agreed to purchase a convertible redeemable promissory note (the
“GW Note”) in the aggregate principal amount of $69,300. On August 12, 2019, the Company issued the GW Note and received
a net amount of $60,000. The GW Note entitles the holder to 12% interest per annum and matures on August 12, 2020.
Pursuant to the GW Note, during the first six months after
issuance, GW may convert all or a portion of the outstanding principal of the GW Note into shares of Common Stock of the Company
at a fixed price equal to $0.25 per share. Thereafter, the conversion price per share shall be equal to 60% of the lowest trading
price during the 20 prior trading days (including the day upon which a notice of conversion is received), provided, however, that
if the Company experiences a DTC “Chill” on its shares of Common Stock, the conversion price shall be reduced to 40%
while such DTC “Chill” remains in effect. GW may not convert the GW Note to the extent that such conversion would result
in beneficial ownership by GW and its affiliates of more than 9.99% of the Company’s issued and outstanding Common Stock.
If the Company redeems the GW Note within 90 days of its
issuance, the Company must pay all of the principal at a cash redemption premium of 135%; if such redemption is made between the
90th day and the 180th day after the issuance of the GW Note, then such redemption premium is 150%. After the 180th day following
the issuance of the GW Note, there shall be no further right of redemption.
In the event all or substantially all of the assets or
equity of the Company is acquired by a third party, GW may elect to either (i) have the GW Note redeemed by the Company in cash
at a premium of 150% of the principal amount of the GW Note, plus accrued but unpaid interest or (ii) convert the GW Note into
shares of Common Stock of the Company at the applicable conversion price.
In connection with the GW Note, the Company agreed to cause
its transfer agent to reserve 6,800,000 shares of Common Stock, in the event that the GW Note is converted. GW has the right to
periodically request that the number of shares reserved be increased to at least 400% the number of shares of Common Stock issuable
upon conversion of the GW Note.
MorningView Financing
On August 15, 2019, the Company entered into a Securities
Purchase Agreement (the “MorningView SPA”) MorningView Financial, LLC (“MorningView”) pursuant to which
MorningView agreed to purchase a convertible promissory note (the “MorningView Note”) in the aggregate principal amount
of $75,000. On August 15, 2019, the Company issued the MorningView Note and received a net amount of $75,000. The MorningView Note
entitles the holder to 12% interest per annum and matures on August 15, 2020.
Under the MorningView Note, MorningView may, at any time,
convert all or a portion of the outstanding principal of the MorningView Note into shares of Common Stock at a fixed price equal
to $0.25 per share during the first 180 days following the issuance of the MorningView Note. Thereafter, the conversion price per
share shall be equal to lower of (i) the closing price of the Common Stock on the trading day immediately prior to the date of
issuance of the MorningView Note and (ii) 60% of the lowest trading price during the 20 prior trading days, provided, however,
that if the Common Stock is not deliverable by DWAC, the conversion price shall be reduced by 10%. MorningView may not convert
the MorningView Note to the extent that such conversion would result in beneficial ownership by MorningView and its affiliates
of more than 4.99% of the Company’s issued and outstanding Common Stock.
If the Company prepays the MorningView Note within 90 days
of its issuance, the Company must pay all of the principal at a cash redemption premium of 115%; if such prepayment is made between
the 91st day and the 120th day after the issuance of the MorningView Note, then such redemption premium is 130%; if such prepayment
is made from the 121st to the 150th day after issuance, then such redemption premium is 135%; if such prepayment is made from the
151st to the 180th day after issuance, then such redemption premium is 150%. After the 180th day following
the issuance of the MorningView Note, there shall be no further right of prepayment.
At all times, the Company must have
reserved the amount of shares of Common Stock equal to at least 800% the number of shares of Common Stock issuable upon conversion
of the MorningView Note.
The foregoing summaries of the terms of
the GW Note, the MorningView Note, the GW SPA and the MorningView SPA are subject to, and qualified in their entirety by, the agreements
and instruments attached hereto as Exhibits 4.1, 4.2, 10.1, and 10.2, respectively, which are incorporated by reference herein.