Coupons for promissory convertibles have been set at 10%, 8% and 12.5%
By Susanna Moon
Chicago, Feb. 11 – Flasr Inc. raised $101,500 through the private placement of three separate convertible promissory notes, according to an 8-K filing with the Securities and Exchange Commission. In the first tranche, the company sold a $61,000 10% convertible promissory note due Nov. 5, 2016 to Auctus Fund, LLC on Feb. 5.
The Auctus note is convertible into shares of the company’s common stock at a conversion price equal to the lesser of (i) a 45% discount to the lowest trading price of the common stock during the 25 trading days prior to issue and (ii) a 45% discount to the lowest trading price of the common stock during the 25 trading day period prior to conversion.
The conversion price discount will increase by 10% if the company is no longer DWAC-eligible; increase by 15% if the company experiences a DTC “chill” on its shares; and increase by 25% if the company both is no longer DWAC-eligible and experiences a DTC chill. The discount rises by an additional 15% if the company no longer files its reports under the Securities Exchange Act of 1934 or if it fails to deliver to Auctus free trading stock upon a conversion of the Auctus note after 181 days from the issue date of the Auctus note. Failure of the company to timely deliver shares to Auctus upon conversion will result in a payment of $1,000 cash per day.
The company may prepay the Auctus note with a premium of up to 140% of all amounts owed. The Auctus note may not be prepaid after 180 days of issue.
GW note
On Feb. 2, the company issued a $15,500 8% convertible promissory note due on Feb. 2, 2017 to GW Holdings Group, LLC.
All principal and accrued interest is convertible at any time beginning six months after issue into shares of the company’s common stock at a conversion price equal to 50% of the lowest trading price of the common stock during the 20 trading day period prior to conversion. The conversion price discount will be increased to 60% if the company experiences a DTC chill on its shares.
The company may prepay the GW note during the first six months following issue with a premium of up to 145% of all amounts owed to GW, including default interest.
Essex note
On Feb. 3, the company sold a $25,000 12.5% convertible promissory note due Feb. 3, 2017 to Essex Global Investment Corp.
The note is convertible at any time into shares of the company’s common stock at a conversion price equal to 50% of the lowest trading price of the common stock during the 20 trading day period prior to conversion. The conversion price discount will be increased to 60% if the company experiences a DTC chill on its shares.
The company may prepay the Essex note during the first six months after issue with a premium of up to 140% of all amounts owed to Essex, including default interest.
Flasr is an Atlanta company that sells a reusable spittoon system for consumers of moist tobacco products.
| Issuer: | Flasr Inc.
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| Issue: | Convertible promissory note
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| Amount: | $101,500
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| Warrants: | No
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| Stock symbol: | OTCBB: FLSR
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| Market cap: | $29,700
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| Auctus note
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| Amount: | $61,000
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| Maturity: | Nov. 5, 2016
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| Coupon: | 10%
|
| Conversion price: | Lesser of (i) a 45% discount to the lowest trading price of the common stock during the 25 trading days prior to issue and (ii) a 45% discount to the lowest trading price of the common stock during the 25 trading day period prior to conversion
|
| Investor: | Auctus Fund, LLC
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| Prepayment: | At premium of up to 140% of all amounts owed until 180 days of issue
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| Settlement date: | Feb. 5
|
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| GW note
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| Amount: | $15,500
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| Maturity: | Feb. 2, 2017
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| Coupon: | 8%
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| Conversion price: | At any time beginning six months after issue into shares of the company’s common stock at a conversion price equal to 50% of the lowest trading price of the common stock during the 20 trading day period prior to conversion; discount will be increased to 60% if the company experiences a DTC chill on its shares
|
| Investor: | GW Holdings Group, LLC
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| Prepayment: | During the first six months following issue with a premium of up to 145% of all amounts owed, including default interest
|
| Settlement date: | Feb. 2
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| Essex note
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| Amount: | $25,000
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| Maturity: | Feb. 3, 2017
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| Coupon: | 12.5%
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| Conversion price: | At any time at a conversion price equal to 50% of the lowest trading price of the common stock during the 20 trading day period prior to conversion; discount will be increased to 60% if the company experiences a DTC chill on its shares
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| Investor: | Essex Global Investment Corp.
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| Prepayment: | During the first six months after issue with a premium of up to 140% of all amounts owed, including default interest
|
| Settlement date: | Feb. 3
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