Item 1.01 Entry into a Material Definitive Agreement.
On
The Note accrues interest at an annual interest rate of 8% and a default
interest rate of 22%, and matures on
The Company has the right to prepay the outstanding principal amount of the Note, plus any accrued interest on the outstanding principal (including any default interest) at a rate of (x) 120% during the period ending 120 days after the Issue Date and (y) 125% during the period between 121 days and 180 days after the Issue Date. The Company does not have a prepayment right following the expiration of the 180 day period.
Upon the occurrence and during the continuation of any event of default under the Note, the Note becomes immediately due and payable and the Company is obligated to pay the Investor in full satisfaction of its obligations thereunder an amount equal to the greater of (i) the principal amount then outstanding plus accrued interest (including any default interest) through the date of full repayment multiplied by 150% and (ii)(a) the highest number of shares of Common Stock issuable upon conversion of the default sum at the Conversion Price, multiplied by (b) the highest closing price for the Common Stock during the period beginning on the date of first occurrence of the event of default and ending one day prior to the mandatory prepayment date.
The obligations under the Note are not secured by any assets of the Company.
The Agreements contain other provisions, covenants and restrictions common with this type of debt transaction. Furthermore, the Company is subject to negative covenants under the Agreements, which the Company also believes are also customary for transactions of this type.
The preceding summaries of the SPA and the Note do not purport to be complete and are qualified in their entirety by reference to the full text of the SPA and the Note, which are filed as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
The Agreements have been included as exhibits to this Current Report on Form 8-K
to provide investors and securityholders with information regarding certain of
its terms. This information is not intended to provide any financial or other
information about the parties to the Agreements or their respective subsidiaries
or affiliates. The representations, warranties and covenants contained in the
Agreements are made only for purposes of the Agreements and as of the date of
the Agreements, are solely for the benefit of the parties to the Agreements, may
be subject to limitations agreed upon by the parties, and may be subject to
standards of materiality applicable to the parties that differ from those
applicable to investors. Investors should not rely on the representations,
warranties and covenants or any description thereof as characterizations of the
actual state of facts or condition of the parties to the Agreements or any of
their respective subsidiaries or affiliates. Moreover, information concerning
the subject matter of the representations, warranties and covenants may change
after the date of the Agreements, and such subsequent information may not be
fully reflected in public disclosures by the parties to the Agreements. The
information in the Agreements should be considered in conjunction with the
entirety of the factual disclosure about the Company in the Company's public
reports filed with the
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Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The description of the Note set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Item 3.02 Unregistered Sales of
The descriptions of the SPA and the Note set forth in Item 1.01 of this Current
Report on Form 8-K are incorporated by reference into this Item 3.02. The shares
of Common Stock issued pursuant to the SPA, and the Note, were issued in
reliance upon the exemption from securities registration afforded by Section
4(a)(2) of the Securities Act and Rule 506(b) of Regulation D as promulgated by
the
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 10.1 Securities Purchase Agreement, dated as ofJuly 19, 2022 , by and betweenHome Bistro, Inc. and 1800Diagonal Lending LLC 10.2 Convertible Promissory Note, datedJuly 19, 2022 , issued to 1800Diagonal Lending LLC . 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 2
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