SG BLOCKS, INC. (OTCMKTS:SGBXQ) Files An 8-K Entry into a Material Definitive Agreement

SG BLOCKS, INC. (OTCMKTS:SGBXQ) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01 Entry into a Material Definitive Agreement.

On November 17, 2016, SG Blocks, Inc. (the Company)
entered into a Securities Purchase Agreement (theSecurities
Purchase Agreement
), to which the Company sold for a
subscription price of $750,000 an Original Issue Discount Senior
Secured Convertible Debenture to Hillair Capital Investments L.P.
(HCI) in the principal amount of $937,500, with a
maturity date of June 30, 2018 (the Debenture). The
Debenture is convertible at HCIs option, at any time and from
time to time, in whole or in part, into shares of common stock of
the Company at a ratio of 1 share for every $1.25 of debt. Upon a
payment default, a breach of a representation, warranty or
covenant, a Change in Control Transaction, a Fundamental
Transaction or any other Event of Default (each as defined in the
Debenture), at HCIs election the entire amount of the Debenture
at the Mandatory Default Amount will become due and, until paid
in full, any outstanding amounts will bear interest at the lesser
of 18% or the maximum rate permitted by law. The Mandatory
Default Amount is the greater of 130% of the outstanding
principal amount of the Debenture or a formula price reflecting
the fair market value of the number of shares of common stock of
the Company into which the outstanding principal amount of the
Debenture could be converted, in either case plus all other
amounts, costs, expenses and liquidated damages due in respect of
the Debenture. to that certain Subsidiary Guarantee, effective as
of June 30, 2016 (the Guarantee Agreement), by the
Companys subsidiary, SG Building Blocks, Inc. (SGBB), in
favor of HCI, SGBB unconditionally guaranteed (the
Guarantee) the obligations and indebtedness owed to HCI
under the Debenture. The Debenture and SGBBs obligations under
the Guarantee are secured by a first-priority lien and security
interest on all of the Companys and SGBBs assets to that certain
Security Agreement, dated as of June 30, 2016, by and between the
Company, SGBB and HCI (the Security Agreement). The
proceeds from the issuance of the Debenture will be used for
general working capital purposes of the Company. This is an
original issue discount obligation and accordingly there are no
regularly scheduled interest payments. The Company may not prepay
any portion of the principal amount of the Debenture without the
prior written consent of HCI.

Copies of the Debenture, the Securities Purchase Agreement, the
Guarantee Agreement, and the Security Agreement are attached to
this Current Report on Form 8-K as Exhibit 4.1, Exhibit 4.2,
Exhibit 4.3, and 4.4, respectively, and are incorporated herein
by reference.

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

The information described in Item 1.01 of this Current Report on
Form 8-K is incorporated by reference into this Item 2.03.

Item 8.01 Other Events.

On November 22, 2016, the Company issued a press release
announcing the financing transaction contemplated by the
Securities Purchase Agreement. A copy of the press release is
filed as Exhibit 99.1 to this Current Report on Form 8-K and is
incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits
4.1 Original Issue Discount Senior Secured Convertible Debenture,
dated as of November 17, 2016, by and between Hillair Capital
Investments, L.P. and SG Blocks, Inc.
4.2 Securities Purchase Agreement, dated as of November 17, 2016,
by and between SG Blocks, Inc. and each of the purchasers
identified therein.
4.3 Subsidiary Guarantee, dated as of June 30, 2016, by SG
Building Blocks, Inc. (Incorporated herein by reference to
Exhibit 4.5 to the Companys Current Report on Form 8-K/A,
filed August 8, 2016)
4.4 Security Agreement, dated as of June 30, 2016, by and between
SG Blocks Inc., SG Building Blocks, Inc. and Hillair Capital
Investments L.P. (Incorporated herein by reference to Exhibit
4.6 to the Companys Current Report on Form 8-K/A, filed
August 8, 2016)
99.1 Press Release, dated November 22, 2016.


About SG BLOCKS, INC. (OTCMKTS:SGBXQ)

SG Blocks, Inc., through SG Building Blocks, Inc. (SG Building), provides code engineered cargo shipping containers. SG Building modifies and delivers containers. SG Building enables developers, architects, builders and owners to achieve greener construction. In addition to providing code engineered cargo shipping containers for construction use, SG Building is engaged in structural steel framing systems. SG Building first selects shipping containers appropriate for the project, which are then designed and engineered. These steel containers are then modified or manufactured under contract into a structure, which is referred as SG Blocks. A combination of engineering and architecture is used to make the containers adaptable for a variety of commercial and residential uses. SG Blocks can be used to build a range of construction, from traditional to modern.

SG BLOCKS, INC. (OTCMKTS:SGBXQ) Recent Trading Information

SG BLOCKS, INC. (OTCMKTS:SGBXQ) closed its last trading session at 0.00770 with 4,500 shares trading hands.

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