MGT Capital Investments, Inc. (OTCMKTS:MGTI) Files An 8-K Entry into a Material Definitive Agreement

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MGT Capital Investments, Inc. (OTCMKTS:MGTI) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01 Entry into Material Definitive Agreements.

1. Line of Equity of up to $5,000,000

On March 14, 2017, MGT Capital Investments, Inc., a Delaware
corporation (the Company) and L2 Capital, LLC (L2 Capital), a
Kansas limited liability company, entered into an equity purchase
agreement (the Equity Purchase Agreement), to which the Company
shall issue and sell to L2 Capital from time to time up to five
million dollars ($5,000,000.00) of the Companys common stock (the
Common Stock) that will be registered with the Securities and
Exchange Commission (the SEC) under a registration statement on a
form S-1. to the Equity Purchase Agreement, the Company may
require L2 Capital to purchase shares of Common Stock in a
minimum amount of $25,000 and maximum of the lesser of (a)
$1,000,000.00 or (b) 150% of the Average Daily Trading Value,
upon the Companys delivery of a Put Notice to L2 Capital. L2
Capital shall purchase such number of shares of Common Stock at a
per share price that equals to the lowest closing bid price of
the Common Stock during the Pricing Period multiplied by 90%.
Before the expiration of the term of the Equity Purchase
Agreement, the said Agreement shall terminate, subject to certain
exceptions set forth therein, at any time by a written notice
from the Company to L2 Capital.

In connection with the Equity Purchase Agreement, the Company has
issued to L2 Capital an 8% convertible promissory note (the
Commitment Note) in the principal amount of $160,000 in
consideration of L2 Capitals contractual commitment to the Equity
Purchase Agreement. The Commitment Note matures six months after
the Issue Date. All or part of the Commitment Note is convertible
into the Common Stock of the Company upon the occurrence of any
of the Events of Default at a Variable Conversion Price that
equals to 75% of the lowest Trading Price for the Common Stock
during a thirty-day Trading Day period immediately prior to the
Conversion Date.

2. Convertible Promissory Notes and Warrants

On March 10, 2017, the Company and L2 Capital entered into a
securities purchase agreement (the Securities Purchase
Agreement), to which the Company issued two 10% convertible notes
(the Convertible Notes) in an aggregate principal amount of
$1,000,000 with a 20% original issue discount, which was funded
on March 14, 2017. The Company received gross proceeds of
$392,500 (which represents the deduction of the 20% original
discount and $7,500 for L2 Capitals legal fees) in exchange for
issuance of the first Convertible Note (the First Note) in the
Principal Amount of $500,000. The First Note matures six months
from the Issue Date and the accrued and unpaid interest at a rate
of 10% per annum is due on such date. At any time on or after the
occurrence of an Event of Default, the Holder of the First Note
shall have the right to convert all or part of the unpaid and
outstanding Principal Amount and the accrued and unpaid interest
to shares of Common Stock at a Conversion Price that equals 65%
multiplied by the lowest Trading Price for the Common Stock
during a thirty-day Trading Day period immediately prior to the
Conversion Date (the Market Price).

On the date stated immediately above, the Company received a L2
Capital Back End Note (L2 Collateralized Note) secured with the
First Note for its issuance of the Second Note to L2 Capital. In
accordance with the Second Note, the Company shall pay to the
order of L2 Capital a Principal Amount of $500,000 and the
accrued and unpaid interest at a rate of 10% per annum on the
Maturity Date, which is eight months from the Issue Date. At any
time on or after the occurrence of an Event of Default, the
Holder of the Second Note shall have the right to convert all or
part of the unpaid and outstanding Principal Amount and the
accrued and unpaid interest into shares of Common Stock at a
Conversion Price that equals to 65% multiplied by the Market
Price. to the L2 Collateralized Note, L2 Capital promises to pay
the Company the Principal Amount of $500,000 (consisting $392,500
in cash, legal fees of $7,500 and an original issuance discount
of $100,000) no later than November 10, 2017.

In connection with the issuance of the First Note and the Second
Note, the Company also issued to L2 Capital Warrants to purchase
up to 400,000 shares of Common Stock (the Warrant Shares) to the
common stock purchase warrant (the Common Stock Purchase Warrant)
executed by the Company. The Warrant shall be exercisable at a
price of 110% multiplied by the closing bid price of the Common
Stock on the Issuance Date (the Exercise Price), subject to
adjustments and exercisable from the Issue Date until the
five-year anniversary. At the time that the Second Note is funded
by the Holder thereof in cash, then on such funding date, the
Warrant Shares shall immediately and automatically be increased
by the quotient (the Second Warrant Shares) of $375,000.00
divided by the lesser of (i) the Exercise Price and (ii) 110%
multiplied by the closing bid price of the Common Stock on the
funding date of the Second Note. With respect to the Second
Warrant Shares, the Exercise Price hereunder shall be redefined
to equal the lesser of (i) the Exercise Price and (ii) 110%
multiplied by the closing bid price of the Common Stock on the
funding date of the Second Note. L2 Capital may exercise the
Warrant cashless unless the underlying shares of Common Stock
have been registered with the SEC prior to the exercise.

Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.

The information contained in Item 1.01 is hereby incorporated by
reference.

Item 3.02 Unregistered Sales of Equity
Securities.

The information contained in Item 1.01 is hereby incorporated by
reference.


About MGT Capital Investments, Inc. (OTCMKTS:MGTI)

MGT Capital Investments, Inc. (MGT), through its subsidiaries, is engaged in the business of acquiring, developing and monetizing assets in the online and mobile gaming space, as well as the social casino industry. The Company operates through two segments: Gaming and Intellectual Property. MGT’s gaming portfolio includes a social casino platform Slot Champ. It also includes minority stakes in the skill-based gaming platform MGT Play and fantasy sports operator DraftDay Gaming Group, Inc. (DDGG). The Company’s subsidiaries include Medicsight, Inc. (Medicsight), MGT Sports, Inc. (MGT Sports), MGT Studios, Inc. (MGT Studios) and MGT Gaming, Inc. (MGT Gaming). Medicsight owns medical imaging software and has designed an automated carbon dioxide insufflation device on which the Company receives royalties from an international distributor. The software is designed to detect colorectal polyps during a virtual colonoscopy performed using computed tomography.

MGT Capital Investments, Inc. (OTCMKTS:MGTI) Recent Trading Information

MGT Capital Investments, Inc. (OTCMKTS:MGTI) closed its last trading session down -0.010 at 0.850 with 98,733 shares trading hands.

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