SUNSTOCK, INC. (OTCMKTS:SSOK) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01. Entry into a Material Definitive
Agreement.

Securities Purchase Agreements and Notes

On June 15, 2017, Sunstock, Inc. (the Company or we) entered into
a securities purchase agreement (SPA AUC) with Auctus Fund, LLC,
upon the terms and subject to the conditions of SPA, we issued a
convertible promissory note in the principal amount of
$112,250.00 (the Note) to Auctus. The Company received proceeds
of $99,500.00 in cash from Auctus. Interest accrues on the
outstanding principal amount of the Note at the rate of subject
12% per year. The Note is due and payable on February 24, 2018.
The Note is convertible into common stock, subject to Rule 144,
at any time after the issue date, at the lower of (i) the closing
sale price of the common stock on the on the trading day
immediately preceding the closing date, and (ii) 55% of the
lowest sale price for the common stock during the two (2) lowest
trading days during the twenty-five (25) Trading Day period
ending on the last complete Trading Day prior to the Conversion
Date. If the shares are not delivered to Auctus within three
business days of the Companys receipt of the conversion notice,
the Company will pay Auctus a penalty of $2,000 per day for each
day that the Company fails to deliver such common stock through
willful acts designed to hinder the delivery of common stock to
Auctus. Auctus does not have the right to convert the Note, to
the extent that it would beneficially own in excess of 4.99% of
our outstanding common stock. The Company shall have the right,
exercisable on not less than three (3) trading days prior written
notice to Auctus, to prepay the outstanding balance on this Note
for (i) 135% of all unpaid principal and interest if paid within
90 days of the issue date and (ii) 140% of all unpaid principal
and interest starting on the 91st day following the issue date.
In the event of default, the amount of principal and interest not
paid when due bear default interest at the rate of 24% per annum
and the Auctus Note becomes immediately due and payable.
Regarding the Note, the Company paid Auctus $12,750 for its
expenses and legal fees.

The Note is a long-term debt obligation that is material to the
Company. The Note also contains certain representations,
warranties, covenants and events of default including if the
Company is delinquent in its periodic report filings with the
SEC, and increases in the amount of the principal and interest
rates under the Note in the event of such defaults. In the event
of default, at the option of Auctus and in Auctuss sole
discretion, Auctus may consider the Note immediately due and
payable.

The foregoing descriptions of the SPA and Note are qualified in
their entirety by reference to such SPA and Note, which are filed
hereto as Exhibits 10.1, and 4.1 and are incorporated herein by
reference.

On June 22, 2017, the Company entered into a securities purchase
agreement (SPA2) with EMA Financial, LLC (EMA), upon the terms
and subject to the conditions of SPA2, we issued a convertible
promissory note in the principal amount of $115,000.00 (the
Note2) to EMA. The Company received proceeds of $100,000.00 in
cash from EMA. Interest accrues on the outstanding principal
amount of the Note2 at the rate of 10% per year. The Note2 is due
and payable on June 5, 2018. The Note2 is convertible into common
stock, subject to Rule 144, at any time after the issue date, at
the lower of (i) the closing sale price of the common stock on
the on the trading day immediately preceding the closing date,
and (ii) 50% of the lowest sale price for the common stock during
the twenty (25) consecutive trading days immediately preceding
the conversion date. If the closing sale price at any time fall
below $0.695 (as appropriately and equitably adjusted for stock
splits, stock dividends, stock contributions and similar events),
then such 50% figure mentioned above shall be reduced to 35%. If
the shares are not delivered to EMA within three business days of
the Companys receipt of the conversion notice, the Company will
pay EMA a penalty of $1,000 per day for each day that the Company
fails to deliver such common stock through willful acts designed
to hinder the delivery of common stock to EMA. EMA does not have
the right to convert the note, to the extent that it would
beneficially own in excess of 4.9% of our outstanding common
stock. The Company shall have the right, exercisable on not less
than five (5) trading days prior written notice to EMA, to prepay
the outstanding balance on this Note for (i) 135% of all unpaid
principal and interest if paid within 90 days of the issue date
and (ii) 150% of all unpaid principal and interest starting on
the 91st day following the issue date. In the event of default,
the amount of principal and interest not paid when due bear
default interest at the rate of 24% per annum and the Note2
becomes immediately due and payable. In connection with the
Note2, the Company paid EMA $15,000 for its expenses and legal
fees.

The Note2 is a long-term debt obligation that is material to the
Company. The Note2 also contains certain representations,
warranties, covenants and events of default including if the
Company is delinquent in its periodic report filings with the
SEC, and increases in the amount of the principal and interest
rates under the Note2 in the event of such defaults. In the event
of default, at the option of EMA and in EMAs sole discretion, EMA
may consider the Note2 immediately due and payable.

The foregoing descriptions of the SPA and Note2 are qualified in
their entirety by reference to such SPA and Note2, which are
filed hereto as Exhibits 10.2, and 4.2 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 disclosure in Item 1.01 of this Current Report on Form 8-K is
incorporated by reference into this Item.

Item 3.02 Unregistered Sales of Equity
Securities

The disclosure in Item 1.01 of this Current Report on Form 8-K is
incorporated by reference into this Item. As of June 27, 2017,
the Company had a total of approximately 41,023,638 shares of
common stock issued and outstanding.

These securities were not registered under the Securities Act of
1933, as amended (the Securities Act), but qualified for
exemption under Section 4(a)(2) of the Securities Act. The
securities were exempt from registration under Section 4(a)(2) of
the Securities Act because the issuance of such securities by the
Company did not involve a public offering, as defined in Section
4(a)(2) of the Securities Act, due to the insubstantial number of
persons involved in the transaction, size of the offering, manner
of the offering and number of securities offered. The Company did
not undertake an offering in which it sold a high number of
securities to a high number of investors. In addition, this
investor had the necessary investment intent as required by
Section 4(a)(2) of the Securities Act since they agreed to, and
will receive, share certificates bearing a legend stating that
such securities are restricted to Rule 144 of the Securities Act.
This restriction ensures that these securities would not be
immediately redistributed into the market and therefore not be
part of a public offering. Based on an analysis of the above
factors, we have met the requirements to qualify for exemption
under Section 4(a)(2) of the Securities Act.

Item 9.01. Financial Statements and
Exhibits

(d) Exhibits.

Sunstock, Inc. Exhibit
EX-4.1 2 ex4-1.htm   NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,…
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About SUNSTOCK, INC. (OTCMKTS:SSOK)

Sunstock, Inc., formerly Sandgate Acquisition Corporation, owns and operates discount retail stores. The Company operates a deep discount variety retail store under the name Dollar Green Stores (dollar stores) in Sacramento, California. The Company intends to acquire and operate hotels and residential properties in the areas of California, such as Southern California and the Bay Area. The Company intends to offer additional products, including gifts, party goods, toys, batteries, small electronics, greeting cards, pet supplies, pet food, gardening supplies, durable housewares, kitchen supplies, cookware, consumables, such as paper, plastics, household chemicals, and other items, including seasonal goods, such as Easter, Halloween and Christmas merchandise.