Q BioMed Inc. (OTCMKTS:QBIO) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
On December 6, 2019, we entered into a securities purchase agreement with an accredited investor (the “Debenture Holder”) to place Convertible Debentures (the “Debentures”) with a maturity date of June 6, 2021 in the aggregate principal amount of up to $3,000,000 (the “Transaction”), provided that in case of an event of default, the Debentures may become at the Debenture Holder’s election immediately due and payable. The initial closing of the Transaction occurred on December 6, 2019 when we issued a Debenture for $1,000,000. A second closing is scheduled for within thirty days of December 6, 2109 and a third is scheduled for within 60 days of December 6, 2019, provided that the daily VWAP of the Common Stock during each of the five consecutive trading days immediately prior to the applicable closing date is at least $2.00. The Debentures bear interest at the rate of 5.5% per annum. On the second and third debentures only, we must pay to the Debenture Holder a commitment fee equal to 2.5% of the amount of the Debentures.
The Debenture Holder may convert a Debenture in its sole discretion at any time on or prior to maturity at the lower of $3.00 or 93% of the average of the four lowest daily VWAPs during the 10 consecutive trading days immediately preceding the conversion date, provided that the conversion price may never be less than $2.00. We may not convert any portion of a Debenture if such conversion would result in the holder beneficially owning more than 4.99% of our then issued and common stock, provided that such limitation may be waived by the holder with 65 days’ notice.
Any time after the six-month anniversary of the issuance of a Debenture that the daily VWAP is less than $2.00 for a period of twenty consecutive trading days (the “Triggering Date”) and only for so long as such conditions exist after a Triggering Date as that term is defined in the Transaction documents, we shall make monthly payments beginning on the last calendar day of the month when the Triggering Date occurred. Each monthly payment shall be in an amount equal to the sum of (i) the principal amount outstanding as of the Triggering Date divided by the number of such monthly payments until maturity, (ii) a redemption premium of 20% in respect of such principal amount and (iii) accrued and unpaid interest hereunder as of each payment date. We may, no more than twice, obtain a thirty-day deferral of a monthly payment due as a result of a Triggering Date through the payment of a deferral fee in the amount equal to 10% of the total amount of such monthly payment. Each deferral payment may be paid by the issuance of such number of shares as is equal to the applicable deferral payment divided by a price per share equal to 93% of the average of the four lowest daily VWAPs during the 10 consecutive Trading Days immediately preceding the due date in respect of such monthly payment being deferred, provided that such shares issued will be immediately freely tradable shares in the hands of the holder.
The information set forth in Item 1.01 hereof is incorporated by reference into this Item 3.02.
The securities mentioned above were issued in reliance on exemptions from registration under Section 4(2) of the Securities Act of 1933, as amended (the “Act”), and Rule 506 of Regulation D promulgated under the Act. These transactions qualified for exemption from registration because among other things, the transaction did not involve a public offering, the investor was an accredited investor and/or qualified institutional buyer, the investor had access to information about our company and its investment, the investor took the securities for investment and not resale, and we took appropriate measures to restrict the transfer of the securities.
Exhibits.
| 10.1 | Securities Purchase Agreement, dated December 5, 2019 |
| 10.2 | Form of Debenture |
Q BioMed Inc. Exhibit
EX-10.1 2 tm1925000d1_ex10-1.htm EXHIBIT 10.1 Exhibit 10.1 SECURITIES PURCHASE AGREEMENT THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”),…
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About Q BioMed Inc. (OTCMKTS:QBIO)
Q BioMed, Inc., formerly ISMO Tech Solutions, Inc., is a biomedical acceleration and development company. The Company is focused on licensing, acquiring and providing strategic resources to life sciences and healthcare companies. The Company intends to acquire multiple assets over time and across a spectrum of healthcare related products, companies and sectors. The Company intends to develop these assets to provide returns through organic growth, out-licensing, sale or spin-off into new public companies. The Company holds license for a generic drug, Strontium Chloride (SR89). SR89 is a radiopharmaceutical agent and indicated for the treatment of pain associated with metastatic bone cancer. Its asset, MAN-01, is indicated for the treatment of glaucoma. MAN-01 is in pre-clinical stage. The Company is assessing multiple biomedical assets in various areas of healthcare and drug development. It is pursuing a pipeline of therapeutics, diagnostics and orphan drug candidates.
