FINDEX.COM, INC. (OTCMKTS:FIND) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.
During the period June 6-12, 2019, Findex.com, Inc. (the “Company”) entered into a series of related Securities Exchange Agreements and Securities Purchase Agreements with then Company debtholders by which it effectively restructured what had been an aggregate of $3,714,485 in outstanding debt on its balance sheet and leaving in its stead only a combination of a newly authorized series of convertible preferred stock and warrants to acquire two separate but also recently authorized series’ of convertible preferred stock. These transactions represented a deliberate and carefully planned initiative by the Company aimed at significantly increasing the strength of its balance sheet by eliminating 81% of its previously existing debt and relief from the resulting and mounting financial vulnerability and stress to which the Company had become increasingly exposed in recent years.
As of June 12, 2019, Findex.com, Inc. had total liabilities of $4,577,859 on its balance sheet, and had been facing increasing financial pressures for years, and challenges in raising much-needed working capital, because of it. Through a carefully structured and negotiated series of related transactions constituting a major recapitalization of the company as of June 12, 2019, however, that figure, not yet audited but confirmed by the company’s internal accounting representatives, has been reduced to $863,374. Further, all ongoing interest expense relating to the subject debt has also been eliminated and will no longer be a factor in calculating the net income of the company.
The aggregate $3,714,485 that had existed as outstanding debt obligations on the Company’s balance sheet as of the beginning of the restructuring period consisted of a combination of the following:
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
As described in Item 1.01 of this Current Report on Form 8-K, (a) to the securities exchange agreements and the securities purchase agreements, the Company issued and sold shares of Series RX-1 Preferred Stock, issued and sold Series RX-2 Warrants, and issued and sold Series RX-3 Warrants. The issuance and sale by the Company of the shares of Series RX-1 Preferred Stock and the issuance and sale of the Series RX-2 Warrants and Series RX-3 Warrants by the Company to the various recipients were made in reliance upon the exemption from securities registration afforded by Sections 3(a)(9) and 4(a)(2) of the Securities Act of 1933, as amended, as well as Rule 506 of Regulation D promulgated thereunder.
Section 5 – Corporate Governance and Management.
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
As part of the transactions described in Item 1.01 of this Current Report on Form 8-K above under the sub-heading “The Series RX-3 Preferred Stock Warrant Transactions,” our president and chief executive officer, Steven Malone, received two warrants to purchase a total of 211,733 shares of Series RX-3 Preferred Stock in exchange for debt owed to him by the Company for services rendered in the aggregate amount of $609,716. The Series RX-3 Warrants issued to Mr. Malone are only exercisable in accordance with the limitations set forth above in the description of the Series RX-3 Warrants, and only upon payment of the stated exercise prices. In the aggregate, the Series RX-3 Warrants issued to Mr. Malone are exercisable for a number of shares of Series RX-3 Preferred Stock convertible into, or, in the event that the Series RX-3 Preferred Stock is automatically converted to Company common stock prior to exercise, directly for, 211,733,000 shares of Company common stock.
Also as part of the transactions described in Item 1.01 of this Current Report on Form 8-K above under the sub-heading “The Series RX-3 Preferred Stock Warrant Transactions,” and in addition to the warrants issued to Mr. Malone, the spouse of Mr. Malone, Micki Malone, the Company controller, received two warrants to purchase a total of 81,806 shares of Series RX-3 Preferred Stock in exchange for debt owed to her by the Company for services rendered in the aggregate amount of $235,775. The Series RX-3 Warrants issued to Ms. Malone are only exercisable in accordance with the limitations set forth above in the description of the Series RX-3 Warrants, and only upon payment of the stated exercise prices. In the aggregate, the Series RX-3 Warrants issued to Ms. Malone are exercisable for a number of shares of Series RX-3 Preferred Stock convertible into, or, in the event that the Series RX-3 Preferred Stock is automatically converted to Company common stock prior to exercise, directly for, 81,806,000 shares of Company common stock. The securities issued to Ms. Malone constitute a part of Mr. Malone’s beneficial ownership in the Company.
Section 9 – Financial Statements and Exhibits.
(d) Exhibits
| 10.1 | Series RX-1 Securities Exchange Agreement. |
| 10.2 | Series RX-2 Securities Exchange Agreement. |
| 10.3 | Series RX-2 Securities Purchase Agreement. |
| 10.4 | Series RX-2 Preferred Stock Purchase Warrant. |
| 10.5 | Series RX-3 Securities Exchange Agreement. |
| 10.6 | Series RX-3 Securities Purchase Agreement. |
| 10.7 | Series RX-2 Preferred Stock Purchase Warrant. |
FINDEX COM INC Exhibit
EX-10.1 2 exhibit10_1.htm SECURITIES EXCHANGE AGREEMENT Exhibit 10.1 SECURITIES EXCHANGE AGREEMENT This Securities Exchange Agreement (this “Agreement”),…
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About FINDEX.COM, INC. (OTCMKTS:FIND)
Findex.com, Inc. develops, manufactures and markets a line of specialty industrial glass-based surface coatings materials that have a range of industrial, commercial and consumer applications. The Company’s line of products offers a range of multi-surface and end-product applications, such as marine industry, vessels and infrastructure; energy production equipment, and hardscapes. Its line of products center around a technology that either on its own or when coupled with any of the available formula additives offers a combination of surface properties. Its principal products include ECT-1110 Interior Coating, ECT-1120 General Purpose Polyurethane Coating, ECT-1390 HVAC Corrosion Energy Coating, ECT-1000 Universal Micro-Coating and ECT-1470 Hardscape Coating. It also has a business that involves a surfacing process to treat and cover existing floors, walls, counter-tops and table-tops. Its specialty surfacing operation offers a system under the brand name EcoSmart Digital Flooring.