UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) of the

SECURITIES EXCHANGE ACT OF 1934

April 5, 2021

Date of Report (Date of Earliest event reported)

SHARING SERVICES GLOBAL CORPORATION

(Exact Name of Registrant as Specified in Charter)

(Former Name or Former 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:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (/Section 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (Section 240.12b-2 of this chapter).

Emerging growth company [X]

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. [  ]

Item 1.01 Entry into a Material Definitive Agreement.

As previously disclosed in Note 16, Subsequent Events, of the Notes to our Condensed Consolidated Financial Statements contained in our Form 10-Q for the period ending January 31, 2021, Sharing Services Global Corporation (the “Company”) and Document Security Systems, Inc. (“DSS”) who, together with its wholly owned subsidiary, Decentralized Sharing Systems, Inc. (“DSSI”), is currently a major shareholder of the Company, executed a Binding Letter of Intent pursuant to which DSS agreed to loan the Company, directly or through its subsidiaries, the aggregate principal amount of $30.0 million, subject to the parties entering into a definitive loan agreement.

The information contained in Item 2.03 of this Current Report on Form 8-K is incorporated in its entirety herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of the Registrant.

On April 5, 2021, the Company and DSSI entered into a Securities Purchase Agreement, pursuant to the Binding Letter of Intent discussed above. Under the terms of the Securities Purchase Agreement, the Company issued: (a) a Convertible Promissory Note in the principal amount of $30.0 million (the “Note”) in favor of DSSI, and (b) a detachable Warrant to purchase up to 150,000,000 shares of the Company’s Class A Common Stock, at $0.22 per share.

The Note bears interest at the annual rate of 8% and matures on April 5, 2024, subject to certain acceleration provisions upon the occurrence of an Event of Default, as defined in the Note. Interest on the Note is prepayable annually in cash or in shares of the Company’s Class A Common Stock, at the option of the Company, except that interest for the first year is prepayable in shares of the Company’s Class A Common Stock, at the rate of $0.20 per share. Borrowings under the Note may be prepaid without penalty, in full or in part, at the option of the Company, at any time after the first anniversary of the Note. At any time during the term of the Note, all or part of the Note, including principal, less unamortized prepaid interest, if any, plus any accrued interest and other fees can be converted into shares of the Company’s Class A Common Stock at the rate of $0.20 per share, at the option of the holder.

The detachable Warrant confers the right to purchase up to 150,000,000 shares of the Company’s Class A Common Stock, is fully vested and may be exercised at any time on or before April 5, 2026, at the exercise price of $0.22 per share.

In connection with the loan, the Company agreed to pay to DSSI a loan Origination Fee of $3.0 million, payable in shares of the Company’s Class A Common Stock, at the rate of $0.20 per share. Accordingly, upon funding of the loan, the Company will issue to DSSI 27,000,000 shares of its Class A Common Stock, including 15,000,000 shares in payment of the loan Origination Fee and 12,000,000 shares in prepayment of interest for the first year.

Proceeds from the loan are to be deposited in a special purpose bank account and are intended primarily to fund the Company’s domestic and international growth initiatives. The Company’s Board of Directors retained oversight and delegated control responsibility to a specified Company Director, who also holds an executive position with DSS. The Company’s Board of Directors has stipulated that authority to disburse funds from the designated bank account is delegated to: (a) the specified Director acting together with (b) the Company’s Chief Executive Officer or the Company’s Chief Financial Officer.

Shareholder approval will be required to increase the number of authorized shares of the Company’s Class A Common Stock for the potential conversion of 100% of the Note. Under the terms of the Securities Purchase Agreement, the Company has agreed to seek such shareholder approval on or before July 30, 2021.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.