Item
1.01 Entry into a Material Definitive Agreement.
Securities
Purchase Agreement
On
February 17, 2021 (the “Effective Date”), RespireRx Pharmaceuticals Inc. (the “Company”) and FirstFire
Global Opportunities Fund LLC (the “Lender”) entered into a Securities Purchase Agreement (the “SPA”)
by which the Lender provided a sum of $100,000 (the “Consideration”) to the Company, in return for a convertible promissory
note (the “Note”) with a face amount of $112,000 (which difference in value as compared to the Consideration is due
to an original issue discount of $12,000) and 2,000,000 commitment shares (the “Commitment Shares”) of the Company’s
common stock, par value $0.001 (“Common Stock”). In addition, and to induce the Lender to enter into the SPA, the
Company and the Lender 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 “1933 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 February 19, 2021 (the “Closing Date”), equal $97,500 after payment of $2,500
in Lender’s legal fees, and will be used for general corporate purposes.
Pursuant
to the terms of the SPA and the Note, the Lender paid the Consideration to the Company on the Closing Date. The Note obligates
the Company to pay interest at a rate of 10% per annum on any unpaid principal beginning on the Closing Date. The maturity date
of the note is November 17, 2021, at which time a final payment equal to the principal amount plus any accrued and unpaid interest
and other fees will become due. In the event of a default by the Company, the default interest rate will be the lesser of 24%
or the maximum amount permitted by law. Additionally, if during the term of the Note the Company fails to meet its reporting obligations
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company will be subject to a $3,000
penalty for each day that such failure persists, and if not timely paid, 2% interest per month on such amount.
The
Company is required under the SPA to file a Form 1-A under Regulation A of the 1933 Act within sixty days of the Effective Date
(the “Reg A Offering”) listing the Lender as a selling stockholder with respect to the shares of Common Stock underlying
any of the outstanding notes and securities between the Lender and the Company, including, but not limited to, the Note and the
Commitment Shares (collectively, the “Lender Securities”). If the Lender Securities are not included for sale in the
Reg A Offering, then the Registration Rights Agreement will require such shares to be registered for sale in one of the next three
registration statements filed by Company, subject to the permissibility of such inclusion under the 1933 Act and the Exchange
Act, and the rules and regulations promulgated thereunder.
The
Lender has the right, at any time after 180 days from the Effective Date, to convert any outstanding and unpaid amount of the
Note into shares of Common Stock or securities convertible into Common Stock, provided that such conversion would not result in
the Lender beneficially owning more than 4.99% of the Company’s then outstanding shares of Common Stock. Subject to certain
limitations and adjustments as described in the Note, the Lender may convert at a per share conversion price equal to $0.02 (the
“Fixed Conversion Price”), provided that upon any Event of Default (as defined in the Note), the per share conversion
price will equal $0.01. Additionally, in the event the Company has a DTC “Chill” on its shares, an additional discount
of 10% will apply to the conversion price while the “Chill” is in effect. Upon a conversion, all rights with respect
to the portion of the Note being so converted terminate, except for the right to receive the Company’s Common Stock or other
securities, cash or other assets as provided in the Note due upon such conversion.
The
Company may, with prior written notice to the Lender, prepay the outstanding principal amount under the Note at any time after
the Effective Date by making a payment to the Lender of an amount in cash equal to 115% of the outstanding principal, interest,
default interest and other amounts owed.
The
SPA provides the lender with certain participation rights in any subsequent offering of debt or equity. Under the SPA, the Company
may not enter into an offering of its securities with terms that would benefit an investor more than the Lender is benefited under
the SPA and the agreements ancillary thereto, unless the Company offers the Lender those same terms.
The
Commitment Shares to be issued and sold to the Lender pursuant to the SPA, the Note and the shares of the Company’s Common
Stock issuable upon conversion thereof are offered and sold to the Lender 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 1933 Act, and Rule 506(b)
promulgated by the SEC under the 1933 Act. Pursuant to these exemptions, the Lender 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 additional associated documents do not purport to
be complete. The descriptions of the SPA, the Registration Rights Agreement, and the Note are qualified in their entirety by reference
to the SPA, the Registration Rights Agreement, and the Note, which are included as Exhibit 99.1, Exhibit 99.2, and Exhibit 99.3,
respectively, to this Current Report on Form 8-K and are incorporated herein by reference.