Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): February 16,
2021
EXACTUS, INC.
(Exact
name of the registrant as specified in its charter)
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Nevada
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000-55828
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27-1085858
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(State
or other jurisdiction of
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(Commission
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(IRS
Employer
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of
incorporation)
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File
Number)
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Identification
No.)
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80 NE 4th Avenue, Suite 28, Delray Beach, FL 33483
(Address
of principle executive offices) (Zip code)
Registrant’s
telephone number, including area code: (561) 455-4822
_____________________________________________________________________
(Former
name or 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):
[
] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425).
[
] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12).
[
] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b)).
[
] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c)).
Securities
registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading symbol(s)
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Name of 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. ☐
SECTION 1 – REGISTRANT’S BUSINESS AND
OPERATIONS
Item
1.01
Entry
Into a Material Definitive Agreement
On
February 16, 2021, we entered into a Securities Purchase Agreement
with 3i, LP (“3i”) and an institutional
investor (“Investor”) under which
the Investor agreed to purchase and 3i agreed to sell that certain
8% senior secured convertible note dated November 27, 2019 (the
“Note”)
and all of our warrants previously issued to 3i and 3i agreed
settle and release all claims asserted against us. As a result, 3i
agreed to dismissal of all pending litigation against
us.
As a
result, the Subsidiary Guaranty, IP Security Agreement and
Registration Rights Agreement with 3i were also
terminated.
In
addition, we entered into an Exchange Agreement with the Investor
and filed with the Secretary of State of the State of Nevada a
Certificate of Designation of
Preferences, Rights and Limitations for Series A Preferred
Stock under which the Note in the original principal amount
of $750,000 would be exchanged for $500,000 of a new series of our
preferred stock designated 0% Series A Convertible Preferred Stock
(the “Series A
Preferred”) with a stated value of $1,000 per share
(the “Stated
Value”).
We
authorized the issuance of a total of 1,000 ($1,000,000) of our
Series A Preferred for issuance. Each share of Series A Preferred
is convertible at the option of the Holder, into that number of
shares of our common stock, par value $0.0001 per share) (the
“Common
Stock”) (subject to certain limitations on beneficial
ownership) determined by dividing the Stated Value by $0.05 per
share (the “Conversion Price”),
subject to adjustment in the event of stock dividends, stock
splits, stock combinations, reclassifications or similar
transactions that proportionately decrease or increase the Common
Stock.
We are prohibited from effecting the conversion of the Series A
Preferred to the extent that, as a result of such conversion, the
holder beneficially owns more than 4.99% (which may be increased to
9.99% upon 61 days’ written notice to the Company), in the
aggregate, of the issued and outstanding shares of the Common Stock
calculated immediately after giving effect to the issuance of
shares of Common Stock upon the conversion of the Series A
Preferred. Holders of the Series A Preferred shall be entitled to
vote on all matters submitted to the Company’s stockholders
and shall be entitled to the number of votes equal to the number of
shares of Common Stock into which the shares of Series A Preferred
Stock are convertible, subject to applicable beneficial ownership
limitations. The Series A Preferred Stock provides a liquidation
preference equal to the Stated Value, plus any accrued and unpaid
dividends, fees or liquidated damages.
The Series A Preferred can be redeemed at our option upon payment
of a redemption premium between 120% to 135% of the Stated Value of
the outstanding Series A Preferred redeemed. We are not obligated
to file a registration statement under the Securities Act of 1933,
as amended (the “Act”), with respect to the shares of Common
Stock into which Series A Preferred may be converted however the
Investor will be deemed to have held the Series A Preferred on the
original issue date to 3i for the purposes of the availability of
an exemption from registration provided by Rule 144 under the
Act.
On February 16, 2021 we filed a Certificate of Cancellation and
Withdrawal with the Secretary of State of the State of Nevada
cancelling our previous Certificate of Designation of Preferences, Rights and Limitations
for Series A Preferred Stock, all of which has been converted to
Common Stock.
The
foregoing description of the Securities Purchase Agreement,
Exchange Agreement and Certificate of Designation of Preferences, Rights and Limitations
for Series A Preferred Stock of is a summary of the material
terms of such Agreements, which are filed herewith as Exhibits
10.1, 10.2 and 4.1, respectively, hereto. The Agreements contain
additional terms, covenants, and conditions and should be reviewed
in their entirety for additional information
SECTION 3 – SECURITIES AND TRADING MARKETS
Item
3.02
Unregistered
Sales of Equity Securities
On
February 16, 2021, our board of directors authorized the issuance
of up to 1,000 shares of our Series A Preferred.
We also
have offered to our Series B-1 and Series B-2 preferred stock
inducements to voluntarily convert preferred shares into our Common
Stock and expect to file a Certificate of Cancellation and
Withdrawal with the Secretary of State
of the State of Nevada cancelling our previous Certificate of
Designation of Preferences, Rights and Limitations for Series B-1,
B-2, C. D and E Preferred Stock upon conversion or cancellation of
all such Series.
The foregoing issuances do not involve any public offering
and are exempt from registration pursuant to Section 4(a)(2) of the
Securities Act of 1933, as amended.
Item 8.01
Other Events.
Strategic Alternatives Committee
On
January 22, 2021, our Board of Directors formed a Strategic
Alternatives Committee, for the purpose of evaluating potential
acquisitions, mergers, and other strategic business combinations.
The new committee consists of Directors Larry Wert and Julian
Pittam, with Mr. Wert serving as its chairman. During January and
February 2021, the Strategic Alternatives Committee reviewed
various business combination proposals and entered into separate
negotiations to acquire two companies with existing business and
operations in the electric vehicle industry. Ongoing due diligence
is continuing with respect to one of the two
companies.
As
previously reported, on January 22, 2021, our Board of Directors
authorized a possible reverse split of our common stock at a ratio
of between 1 share for every 40 shares held and 1 share for every
50 shares held, to be determined in the further discretion of the
Board. The reverse split is subject to approval by our shareholders
unless the number of authorized shares of our capital stock is
reduced proportionately in accordance with Nevada law, and may be
authorized, if at all, in connection with a recapitalization
required in connection with an acquisition or similar event. In
connection with a potential acquisition, we are continuing our
recapitalization efforts through, among other things, cancellation
and exchange of existing indebtedness for equity, cancellation of
our outstanding series of preferred stock, and a reverse split.
Under the terms under discussion for the possible acquisition of a
company in the electric vehicle industry, we believe that a reverse
split of our Common Stock of approximately 1:40 may be authorized
by our Board of Directors.
Section 9 – FINANCIAL STATEMENTS AND EXHIBITS
Item
9.01
Financial
Statements and Exhibits
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Exhibit No.
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Description
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Certificate
of Designation of Preferences, Rights
and Limitations for Series A Preferred Stock
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Securities
Purchase Agreement (redacted)
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Exchange
Agreement
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(1)
Portions of this
Exhibit have been redacted.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on behalf of the
undersigned hereunto duly authorized.
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EXACTUS,
INC.
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Date:
February 17, 2021
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By:
/s/ Alvaro Daniel
Alberttis
Alvaro
Daniel Alberttis
Principal
Executive Officer
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