COATES INTERNATIONAL, LTD. (OTCMKTS:COTE) Files An 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.

On September 13, 2017, the Registrant entered into a Securities Purchase Agreement and three back-end collateralized, convertible promissory notes, each, in the face amount of Twenty-Five ($25,000.00) Dollars and no cents issued to Adar Abays, LLC, an independent third party accredited investor (the “Holder”). The Promissory Notes mature in September 2018 and provide for interest at the rate of ten (10%) percent per annum. The Holder is not expected to fund the Notes until 180 days after the issuance date of the Notes, provided the Company determines that it requires the additional working capital at that time. Legal fees of $2,000.00 will be deducted from the amount funded to the Company for each Note. Upon funding, a Note may be converted into unregistered shares of the Registrant’s common stock, par value $0.0001 per share, at the Conversion Price, as defined, in whole, or in part, at any time, at the option of the Holder. All outstanding principal and unpaid accrued interest is due at maturity, if not converted prior thereto. The Company is not permitted to prepay the Notes.

The Conversion Price shall be equal to 62% multiplied by the Market Price, as defined. The Market Price shall be equal to the lowest trading price of the Registrant’s common stock on the OTC Pink during the twenty-five (25) trading-day period ending one trading day prior to the date of conversion by the Holder. The Holder anticipates that upon any conversion, the shares of stock it receives from the Registrant will be freely tradable in reliance on an exemption from registration under Rule 144 of the U.S. Securities and Exchange Commission.

The convertible promissory notes were privately offered and sold to the Holder in reliance on specific exemptions from the registration requirements of the United States federal and state securities laws which the Registrant believes are available to cover this transaction based on representations, warranties, agreements, acknowledgements and understandings provided to the Registrant by the Holder.

ITEM 9.01 FINANCIAL STATEMENT AND EXHIBITS.

(a) Financial Statements of Business Acquired.

N/A

(b) Pro Forma Financial Information.

N/A

(c) Exhibits.

COATES INTERNATIONAL LTD DE Exhibit
EX-10.1 2 f8k091317ex10-1_coatesinter.htm BACK-END,…
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About COATES INTERNATIONAL, LTD. (OTCMKTS:COTE)

Coates International, Ltd. is engaged in developing the Coates Spherical Rotary Valve (CSRV) system technology, which is adaptable for use in piston-driven internal combustion engines of various types. The Company’s CSRV Engines produce only ultra-low levels of harmful emissions while in operation. Engines operating on the CSRV system technology can be powered by a selection of fuels. The CSRV system is designed to replace the intake and exhaust conventional poppet valves used in almost all piston-driven stationary, automotive, motorcycle and marine engines. Unlike conventional valves, which protrude into the engine combustion chamber, the Coates rotary valve system utilizes spherical valves that rotate in a cavity formed between an over two-piece cylinder head. The Coates rotary valve system uses approximately 1/10th the moving parts of conventional poppet valve assemblies. The Company has adapted its technology to industrial engines to power electric generators.