TERRA TECH CORP. (OTCMKTS:TRTC) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
Amendment of Existing Senior Convertible Promissory Notes
On January 25, 2021, Terra Tech Corp. (the “Company”) entered into Amendment No. 3 (the “June 2019 Note Amendment”) to the 7.5% Senior Convertible Promissory Note issued by the Company on June 11, 2019 (the “June 2019 Note”) and Amendment No. 1 (the “October 2019 Note Amendment”; together with the June 2019 Note Amendment, the “Note Amendments”) to the 7.5% Senior Convertible Promissory Note issued by the Company on October 21, 2019 (the “October 2019 Note”; together with the June 2019 Note, the “Old Notes”) with the accredited investor that holds the Old Notes (the “Lender”). The Note Amendments, among other things, (1) extends the maturity date of the June 2019 Note from January 26, 2021 to December 31, 2021 and (2) extends the maturity date of the October 2019 Note from April 21, 2021 to December 31, 2021. Except as modified by the Note Amendments, the terms of the Old Notes are unchanged. There is no material relationship between the Company or its affiliates and the Lender other than in respect of the transactions contemplated by the Note Amendments and the Old Notes. In connection with the Note Amendments, the Company issued to the Lender warrants to purchase 5,000,000 shares of the Company’s common stock (the “Old Note Warrants”) at an exercise price of $0.01 per share. The Old Note Warrants will be exercisable at any time before the close of business on June 25, 2026. The Old Note Warrants will contain cashless exercise provisions and, to the extent not previously exercised, will be automatically exercised via cashless exercise on June 25, 2026.
The foregoing descriptions of the June 2019 Note Amendment, the October 2019 Note Amendment and the Old Note Warrants do not purport to be complete and are qualified in their entirety by reference to the full text of the June 2019 Note Amendment, the October 2019 Note Amendment and the Old Note Warrants, which are filed as Exhibits 4.1, 4.2 and 4.3, respectively, hereto and are incorporated herein by reference.
Securities Purchase Agreement
On January 22, 2021, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain accredited investors (the “Purchasers”), to which the Company agreed to sell to the Purchasers $3,500,000 in aggregate principal amount of the Company’s senior convertible promissory notes (the “Notes”) and warrants to purchase shares of the Company’s common stock (the “Warrants”), exercisable at any time before the close of business on June 25, 2026. The Warrants are comprised of 15,000,000 “A Warrants” with an exercise price of $0.01 per share and 15,000,000 “B Warrants” with an exercise price of $0.2284 per share. The closing of the purchase and sale of the Notes and Warrants is expected to occur on or about January 25, 2021.
The Notes, which are convertible into common stock at any time at the discretion of the respective Purchasers at a conversion price of $0.175 per share of common stock, will bear an interest rate of 3%. The Notes mature on or about July 24, 2022 unless accelerated due to an event of default. The Company has the right to prepay the Notes at any time upon 10 days’ prior notice to the Purchasers. If the Company elects to prepay the Notes, the Company must pay the respective Purchasers an amount in cash equal to the product of (i) the sum of the then-outstanding principal amount of the Notes and all accrued but unpaid interest, multiplied by (ii) (x) 110%, if the prepayment date is within 90 days of the original issue date, (y) 115%, if the prepayment date is between 91 days and 180 days following the original issue date or (z) 125%, if the prepayment date is after the 180th day following the original issue date.
The Purchasers of the Notes will not have the right to convert any portion of the Notes, to the extent that, after giving effect to such conversion, such Purchaser (together with certain related parties) would beneficially own in excess of 4.99% of the shares of our common stock outstanding immediately after giving effect to such conversion. A holder may from time to time increase this limit to 9.99%, provided that any such increase will not be effective until the 61st day after delivery of a notice to the Company of such increase.
The Company can demand that the Purchasers convert the Notes at any time, on five calendar days’ notice, that (i) the daily dollar volume-weighted average price for the Company’s common stock for the prior five consecutive trading days is $0.30 or more and (ii) (1) the shares underlying the Notes have been registered with the U.S. Securities and Exchange Commission (the “SEC”) or (2) there is a fundamental transaction that has been announced by the Company.
The Warrants contain cashless exercise provisions and, to the extent not previously exercised, will be automatically exercised via cashless exercise on or about June 25, 2026.
Terra Tech Corp. Exhibit
EX-4.1 2 trtc_ex41.htm FORM OF AMENDMENT TO SENIOR CONVERTIBLE PROMISSORY NOTE trtc_ex41.htmEXHIBIT 4.1 AMENDMENT NO. 3 TO 7.5% SENIOR CONVERTIBLE PROMISSORY NOTE This Amendment No. 3 (this “Amendment”),…
To view the full exhibit click here
About TERRA TECH CORP. (OTCMKTS:TRTC)
Terra Tech Corp. is a cannabis-focused agriculture company. The Company operates through two segments: Hydroponic Produce and Cannabis Products. The Company, through its subsidiary, GrowOp Technology Ltd., is engaged in the design, marketing and sale of hydroponic equipment. It is also a retail seller of locally grown hydroponic produce, herbs, and floral products through its subsidiary, Edible Garden Corp. (Edible Garden). It intends to operate medical marijuana cultivation, production and dispensary facilities in Nevada through its subsidiaries, MediFarm, LLC (MediFarm), MediFarm I, LLC (MediFarm I) and MediFarm II, LLC (MediFarm II). Through its subsidiary, IVXX, Inc. (IVXX), it produces and sells a line of cannabis flowers and cigarettes, among others. The hydroponic produce segment consists of Edible Garden’s business and operations. Its cannabis products segment consists of IVXX’s business, as well as the proposed business operations of MediFarm, MediFarm I and MediFarm II.