BTCS Inc. (OTCMKTS:BTCS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry Into a Material Definitive Agreement
On March 22, 2017, BTCS Inc. (the Company)
entered into a Settlement Agreement and Note (the CSC
Agreement) with CSC Leasing Company
(CSC) with respect to the equipment lease
schedule entered into between CSC and the Company (the
CSC Lease). The Company leased Bitmain S7
servers and power supplies (the Servers) from
CSC starting on February 2, 2016 for $12,053 per month for a term
of 36 months. Prior to the CSC Agreement the Company owed CSC
$91,823 in accrued and unpaid monthly lease payments and
interest, and had a continuing monthly payment obligation
totaling $277,225 over the remaining term of the CSC Lease for an
aggregate liability of $369,048.
to the CSC Agreement the Company has agreed to: i) issue CSC
833,333 shares of the Companys common stock (the
Shares), and ii) pay CSC $200,000 (the
Cash Payment). The Shares and Cash Payment
constitute the total payment to CSC with respect to the
termination and release from the CSC Lease. The Company agreed to
endorse and deliver to CSC the insurance check it received from
Erie Insurance in the amount of $84,278 which will be credited
against the Cash Payment. The remaining $115,722 Cash Payment is
due in full by March 31, 2018 and is subject certain payment
terms including 10% annual interest, subject to periodic
increase, as set forth in the CSC Agreement.
As a result of the Companys default on the CSC Lease and prior to
the CSC Agreement, the Company forfeited its $25,000 security
deposit with CSC and returned to CSC the remaining leased Servers
in the Companys possession.
The foregoing does not purport to be a complete description of
the terms of the CSC Agreement and is qualified in its entirety
by the full text of the agreement, which is attached to this
Current Report on Form 8-K as Exhibit 10.1 and is incorporated
herein by reference. Readers should review this agreement for a
complete understanding of the terms and conditions associated
with the transaction.
| Item 2.03 |
Creation Of A Direct Financial Obligation Or An Obligation Under An Off-Balance Sheet Arrangement Of A Registrant. |
See Item 1.01, incorporated by reference herein.
Item 3.02 Unregistered Sales of Equity
Securities.
See Item 1.01, incorporated by reference herein. The Shares were
not registered under the Securities Act of 1933, as amended (the
Securities Act), and were issued in reliance
upon the exemption from registration provided by Section 4(a)(2)
of the Securities Act and Rule 506 promulgated thereunder.
Certificates representing the Shares will contain a legend
stating the restrictions applicable to such Shares.
In addition, on March 22, 2017, the Company issued 2,933,682
shares of common stock to certain investors in the Companys April
2015 financing for their cashless warrant exercise of 4,704,961
warrants at a price of $0.032 per share. Mr. Charles Allen and
Mr. Michal Handerhan, each of whom is an executive officer and
director of the Company, were among the investors exercising
warrants, and each exercised 1,109,556 warrants, for 691,841
shares of common stock each. After giving effect to the issuance
there are 32,934,720 shares of common stock issued and
outstanding. The securities were issued and sold in reliance upon
the exemption from registration contained in Section 3(a)(9) of
the Securities Act and Rule 506(b) promulgated thereunder.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Exhibit | |
| 10.1 | CSC Agreement |
About BTCS Inc. (OTCMKTS:BTCS)
BTCS Inc., formerly Bitcoin Shop, Inc., is engaged in the business of hosting an online e-commerce marketplace where consumers can purchase merchandise using digital currencies, including bitcoin and with operations in the blockchain and digital currency ecosystems. The Company operates a beta e-commerce marketplace, which accepts a range of digital currencies, have designed a beta secure digital currency storage solution BTCS Wallet. The Company’s transaction verification services business (bitcoin mining) enables running application-specific integrated circuit (ASIC) servers. The ASIC servers solve a set of prescribed mathematical calculations in order to add a block to the blockchain and thereby confirm bitcoin transactions. The Company’s beta e-commerce marketplace offers approximately 250,000 curated products and utilizes its Intelligent Shopping Engine to find competitive prices on products from over 250 retailers. BTCS Inc. (OTCMKTS:BTCS) Recent Trading Information
BTCS Inc. (OTCMKTS:BTCS) closed its last trading session down -0.0110 at 0.0630 with shares trading hands.