AUTHENTIDATE HOLDING CORP. (OTCMKTS:ADAT) Files An 8-K Entry into a Material Definitive Agreement

AUTHENTIDATE HOLDING CORP. (OTCMKTS:ADAT) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01

Entry into a Material Definitive Agreement.

On March 20, 2017, Authentidate Holding Corp. (the Company)
entered into a note exchange agreement with the holders of an
aggregate principal amount of $2,170,000 of outstanding
promissory notes (the Original Notes) which were due and payable,
to which the Company agreed to issue the holders of such notes,
in consideration of the cancellation of the Original Notes, new
promissory notes in the aggregate principal amount of $2,545,199,
which is equal to the sum of the aggregate principal amount of
the Original Notes plus the accrued but unpaid interest on the
Original Notes (the New Notes). The New Notes are convertible
into shares of the Companys Common Stock at an initial conversion
price of $2.03 per share. Based on the initial conversion price,
the New Notes are convertible into up to 1,253,792 shares of
common stock. If the Company issues or sells shares of its common
stock, rights to purchase shares of its common stock, or
securities convertible into shares of its common stock for a
price per share that is less than the conversion price then in
effect, such conversion price will be decreased to equal 85% of
such lower price. The foregoing adjustments to the conversion
price will not apply to certain exempt issuances, including
issuances to certain employee benefit plans. In addition, the
conversion price is subject to adjustment upon stock splits,
reverse stock splits, and similar capital changes. The right of
holders of the New Notes to convert these securities into common
stock is subject to a 4.99% beneficial ownership limitation,
which beneficial ownership limitation may be increased by a
holder to a greater percentage not in excess of 9.99% after
providing notice to us. The closing of the exchange transaction
occurred on March 20, 2017 and all of the New Notes have a
maturity date of one year from the closing date. The New Notes
are being issued in consideration of the exchange of (i) an
aggregate principal amount of $950,000 of Original Notes held by
VER 83, LLC, which were convertible at a price of $2.25 per
share, (ii) an aggregate principal amount of $520,000 of Original
Notes, held by MKA 79, LLC, which were convertible at a price of
$3.00 per share, and (iii) an aggregate principal amount of
$700,000 of unconvertible Original Notes, of which a note in the
principal amount of $250,000 was held by Hanif A. Roshan, the
Chairman and Chief Executive Officer of the Company and the
remainder was held by Optimum Ventures, LLC, a party affiliated
by ownership with the former members of Peachstate Health
Management, LLC, our subsidiary.

The New Notes bear interest at the rate of 5% per annum with
interest payable upon maturity, the conversion of the New Notes
or on any earlier redemption date. Commencing one month after the
Companys common stock is listed for trading on a national
securities exchange the Company will have the right to redeem all
or any portion of the outstanding principal balance of the New
Notes, plus all accrued but unpaid interest at a price equal to
110% of such amount. The holders of the New Notes shall have the
right to convert any or the entire amount to be redeemed into
common stock prior to redemption. Subject to certain exceptions,
the New Notes are senior to existing and future indebtedness of
the Company and will be secured by a first priority lien on all
of the Companys assets to the extent and as provided in a
Security Agreement entered into between the Company and the
holders. Subject to certain exceptions, the New Notes contain
customary covenants against incurring additional indebtedness and
granting additional liens and contains customary events of
default. Upon the occurrence of an event of default under the New
Notes, the holders may require the Company to repay all or a
portion of the note in cash, at a price equal to 110% of the
principal, plus accrued and unpaid interest.

In connection with the exchange of the Original Notes for the New
Notes, the Company also agreed with the holder of all of our
outstanding shares of Series B Convertible Preferred Stock (the
Series B Preferred Stock) to exchange all of its outstanding
shares of Series B Preferred Stock for shares of a new series of
convertible preferred stock designated as Series E Convertible
Preferred Stock (the Series E Preferred Stock). Accordingly, on
March 20, 2017, the Company also entered into a separate exchange
agreement with the holder of the shares of Series B Preferred
Stock, to exchange such shares for a total of 25,000 shares of
Series E Preferred Stock. Each share of Series E Preferred Stock
will have a stated value of $30.00 per share. to this exchange
agreement, the holder of the shares of Series B Preferred Stock
agreed to waive all unpaid dividends that had accrued on the
shares of Series B Preferred Stock. The shares of Series E
Preferred Stock are initially convertible by the holder into an
aggregate of 187,500 shares of Common Stock at the initial
conversion rate of $4.00 per share. The conversion price of the
new preferred stock is subject to adjustment solely in the event
of stock dividends, combinations, splits, recapitalizations, and
similar corporate events. The right of holders of Series E
Preferred Stock to convert these securities into common stock is
subject to a 4.99% beneficial ownership limitation, which
beneficial ownership limitation may be increased by a holder to a
greater percentage not in excess of 9.99% after providing notice
to us. The Certificate of Designations, Rights and Preferences
and Number of Shares of Series E Convertible Preferred Stock,
referred to as the Series E Designation, was filed with the
Secretary of State of the State of Delaware on March 20, 2017.
The Series E Designation, which defines the rights and
preferences of the Series E Preferred Stock, also provides that:
(i)each holder of the Series E Preferred Stock will have the
right, at any time, to convert the shares of Series E Preferred
Stock into shares of common stock; (ii)the Series E Preferred
Stock will be redeemable at our option commencing one year after
the closing date, provided that the Companys common stock is
listed on a national securities exchange at such time; and
(iii)the Series E Preferred Stock will pay dividends at the rate
of 5%per annum in cash. The Series E Preferred Stock is held by
Greener Fairways, Inc., a party affiliated by ownership with VER
83, LLC.

Copies of the form of the note exchange agreement and preferred
stock exchange agreement are attached hereto as Exhibits 10.1 and
10.2, respectively, and a copy of the form of security agreement
is attached as Exhibit 10.3. Further, a copy of the Series E
Designation is attached as Exhibit 3.1 and a copy of the form of
New Notes is attached as Exhibit 4.2. The above descriptions of
each of the exchange agreements and the security agreement are
qualified in their entirety by reference to Exhibits 10.1, 10.2,
and 10.3, respectively and such agreements are incorporated
herein by reference. In addition, the above descriptions of the
Series E Designation and the New Notes are qualified in their
entirety by reference to Exhibits 3.1 and 4.1 respectively, and
such instruments are incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities.

The information disclosed in Item1.01 of this Current Report on
Form 8-K is incorporated by reference into this Item3.02. The
offer and sale of the securities to the exchange agreements (and
the issuance of shares of the Companys common stock upon exercise
or conversion thereof) have been determined to be exempt from
registration under the Securities Act of 1933, in reliance on
Section4(a)(2) thereof, as transactions by an issuer not
involving a public offering, in which the investors are
accredited and have acquired the securities for investment
purposes and not with a view to or for sale in connection with
any distribution thereof. The securities issued under the
exchange agreements have not been registered under the Securities
Act and may not be offered or sold in the United States absent
registration or an applicable exemption from registration
requirements.This disclosure does not constitute an offer to sell
or the solicitation of an offer to buy any of the Companys
securities, nor will there be any sales of these securities by
the Company in any state or jurisdiction in which the offer,
solicitation or sale would be unlawful.

Item 3.03 Material Modification to Rights of Security
Holders.

The Series E Designation, as filed with the Secretary of State of
the State of Delaware, establishes the Series E Preferred Stock
and defines the rights and preferences of the Series E Preferred
Stock. The material terms and conditions of the Series E
Designation are disclosed in Item 1.01 of this Current Report on
Form 8-K, which information is incorporated by reference into
this Item3.03. In addition, the Series E Designation provides
that no dividends shall be declared or paid or set apart for
payment on any securities that are junior to or on parity with
the Series E Preferred Stock unless full dividends have been or
contemporaneously are declared and paid for all dividends due on
the Series E Preferred Stock. In addition, for so long as any
shares of Series E Preferred Stock remain outstanding, the
company may not without the consent of the holders of a majority
of the shares of Series E Preferred Stock, among other things,
(i)amend, alter or repeal any provisions of the Series E
Preferred Stock or Certificate of Incorporation so as to
materially adversely affect any of the preferences, rights,
powers or privileges of the Series E Preferred Stock or the
holders thereof, (ii)create, authorize or issue any other class
or series of preferred stock on a parity with, or having greater
or preferential rights than, the Series E Preferred Stock with
respect to liquidation or dividends, (iii)directly or indirectly,
redeem, repurchase or otherwise acquire for value, or set aside
for payment or make available for a sinking fund for the purchase
or redemption of, any stock ranking junior to on a parity with
the Series E Preferred Stock, or (iv)enter into any agreement
which would prohibit or restrict its right to pay dividends on
the Series E Preferred Stock.

Item 5.03 Amendments to Articles of Incorporation or Bylaws;
Change in Fiscal Year.

The Series E Designation was filed with the Secretary of State of
the State of Delaware on March 20, 2017. A copy of the Series E
Designation is attached hereto as Exhibit 3.1 and incorporated
herein by reference. The Series E Designation establishes and
designates the Series E Preferred Stock and the rights,
preferences, privileges and restrictions thereof. The summary of
the Series E Designation included in Items 1.01 and 3.03 of this
Current Report on Form8-K is also incorporated herein by
reference.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are attached to this Form 8-K:
Exhibit No. Description
3.1 Certificate of Designations, Preferences and Rights and
Number of Series E Convertible Preferred Stock
4.1 Form of New Note
10.1 Form of Note Exchange Agreement
10.2 Form of Exchange Agreement for Preferred Stock Exchange
10.3 Form of Security Agreement


About AUTHENTIDATE HOLDING CORP. (OTCMKTS:ADAT)

Authentidate Holding Corp. and its subsidiaries provide Web-based revenue cycle management applications, and telehealth products and services. The Company enables healthcare organizations to coordinate care for patients and to manage related administrative and clinical workflows. Its Web-based solutions incorporate multiple features and security technologies, such as business-rules based electronic forms, intelligent routing, transaction management, electronic signatures, identity credentialing, content authentication, automated audit trails and remote patient management capabilities. The Company’s Inscrybe Healthcare is a Web-based revenue cycle management workflow automation solution. Its Telehealth Solutions provide an advanced in-home patient vital signs monitoring system and a Web-based management and monitoring software module for use by healthcare providers. The Company’s AuthentiProof is a content integrity and time-and-date stamp application.

AUTHENTIDATE HOLDING CORP. (OTCMKTS:ADAT) Recent Trading Information

AUTHENTIDATE HOLDING CORP. (OTCMKTS:ADAT) closed its last trading session down -0.07 at 2.35 with shares trading hands.

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