Exhibit 4.1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): August 22, 2022
mPHASE TECHNOLOGIES INC.
(Exact name of Registrant as specified in its charter)
| New Jersey | 000-30202 | 22-2287503 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
1101 Wootton Parkway, #1040
Rockville, MD 20852
(Address of principal executive offices, including zip code)
(301) 329-2700
(Registrant’s telephone number, including area code)
Check the appropriate box below if the 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
| ☐ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| None | None | None |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
As previously disclosed, mPhase Technologies, Inc. (“the Company”) entered into a Securities Purchase Agreement with an accredited investor, AJB Capital Investments, LLC (“AJB”) on June 22, 2022 (“Original SPA”) pursuant to which the Company issued a promissory note in an original principal amount of $1,200,000 (“Original Note”), for which reference is made to a Forms 8-K/A filed with the Securities Exchange Commission on June 30, 2022 and July 5, 2022, respectively.
On August 22, 2022, the Company agreed to an amendment and waiver agreement with respect to the Original SPA and the Original Note (the “Amendment and Waiver”) with AJB. The Amendment and Waiver modified and amended certain terms and conditions set forth in the Original SPA and the Original Note. Pursuant to the Amendment and Waiver, AJB waived any events of default resulting from the Company’s failure to timely make filings with the Security Exchange Commission for the quarter ending March 31, 2022. The Amendment and Waiver further amended the Original Note to provide that the Company shall have thirty (30) days from the date of any further failure or breach resulting in an event of default to cure such event of default. In consideration for entering into the Amended and Waiver, the Company and AJB agreed to amend Section 4(o) of the Original SPA to adjust the strike price of the incentive fee shares from $0.20 to $0.10.
On August 22, 2022, the Company and AJB entered into an additional securities purchase agreement (the “August SPA”), Pursuant to the August SPA, AJB bought a 10% promissory note with an aggregate principal amount of $300,000 (the “August Note”) and warrants (the “August Warrants”) to purchase up to 250,000 shares of Common Stock for proceeds of $270,000 (the “Purchase Price”). The Company further issued 2,250,000 additional incentive fee shares (the “August Incentive Shares”) as additional consideration for the purchase of the August Note. Pursuant to the August SPA, the Company is obligated to file with the Securities and Exchange Commission, within 90 days of the date of closing of the August SPA, a registration statement covering the resale of the August Incentive Fee Shares and the shares underlying the August Note and the August Warrants.
The August Note matures on February 22, 2023, bears interest at the rate of 10% per annum and beginning 180 days after the issuance of the Note and only upon the occurrence of an Event of Default (as defined in the August Note), AJB may convert amounts owing under the August Note into shares of Common Stock. The Company has the right to prepay all or any portion of the outstanding balance of the August Note. The August Note provides that the Company has 90 days to cure any events of default resulting from the Company’s failure to timely make filings with the Security Exchange Commission for the quarter ending March 31, 2022 and a further 30 days to cure any events of default for any other filings failures.
In connection with the August SPA and August Note, the Security Agreement, entered into in connection with the Original SPA, was amended to also secure the obligations of the Company under the August SPA and August Note.
The August SPA contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company, other obligations of the parties thereto, and termination provisions.
Item 1.01 of this Current Report on Form 8-K contains only a brief description of the material terms of the Original SPA, Amended SPA, the Notes and any other agreements between parties, and does not purport to be a complete description of the rights and obligations of the parties thereunder, and such descriptions are qualified in their entirety by reference to the full text of the agreements and Notes, the forms of which are attached as Exhibits 4.1, 4.2, 4.3 and 4.4, respectively, to this Current Report on Form 8-K, and are incorporated herein by reference.
Item 9.01. Exhibits.
(d) Exhibits
Exhibit No. |
Exhibit | |
| 4.1 | Securities and Purchase Agreement, dated as August 22, 2022 by and between mPhase Technologies, Inc. and AJB Capital Investments, LLC | |
| 4.2 | Promissory Note, dated August 22, 2022 by and between mPhase Technologies, Inc, and AJB Capital Investments, LLC | |
| 4.3 | Common Stock Purchase Warrant Agreement by and between mPhase Technologies, Inc, and AJB Capital Investments, LLC | |
| 4.4 | One-Time Waiver/Amendment by and between mPhase Technologies, Inc, and AJB Capital Investments, LLC | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| mPhase Technologies, Inc. | ||
| Date: August 26, 2022 | By: | /s/ Chester White |
| Name: | Chester White | |
| Title: | Director | |
Exhibit 4.1
Exhibit 4.2
Exhibit 4.3
Exhibit 4.4
August 22, 2022
mPhase Technologies, Inc.
1101 Wootton Parkway
#1040
Rockville, MD 20852
Attn: Chet White
E-mail: cwhite@mpower.co
VIA ELECTRONIC MAIL
Re: One-Time Waiver/Amendment
Ladies and Gentlemen:
Reference is made to that certain (i) Securities Purchase Agreement, dated June 22, 2022 (the “Purchase Agreement”), between mPhase Technologies, Inc. (the “Company”), and AJB Capital Investments, LLC (the “Purchaser,”; and, together with the Company, the “Parties”); and (ii) Promissory Note dated June 22, 2022, made by the Company in favor of the Purchaser and issued pursuant to the Purchase Agreement (the “Purchaser Note”). Defined terms used herein but not defined herein shall have the meanings ascribed to such terms in the Purchase Agreement.
For good and valuable consideration, including the One-Time Waiver and Amendment Shares (each as hereinafter defined), the receipt and sufficiency of which are hereby acknowledged, the Purchaser hereby (i) waives any Event of Default or any other breach of any provision of the Purchase Agreement, the Purchaser Note or any other Transaction Document, resulting from the Company’s failure to timely file all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934 for the quarter ending March 31, 2022 (the “One-Time Waiver”); and (ii) in respect of Event of Default under Section 3.9 of the Note, apart from any Event of Default resulting from the Company’s failure to make filings as described in the foregoing clause (i), the Company shall have thirty (30) days from the date of the failure or breach resulting in such Event of Default, to cure such Event of Default (the “Amendment”).
In consideration for the One-Time Waiver and the Amendment, the Company and the Purchaser agree that the reference in Section 4(o) of the Purchase Agreement, to a strike price of $0.10 down from $0.20 of the Company’s Common Stock (the “Waiver and Amendment Shares”). The Company shall instruct its transfer agent (the “Transfer Agent”) to issue a certificate or book entry statement representing the Waiver and Amendment Shares, issuable to the Purchaser immediately upon the Company’s execution of this letter agreement (the “Letter Agreement”) and shall cause its Transfer Agent to deliver such certificate or book entry statement to the Purchaser. In the event such certificate or book entry statement representing the Waiver and Amendment Shares issuable hereunder shall not be delivered to the Purchaser, it shall be an immediate default under Section 3.2 of the Purchaser Note and the other Transaction Documents. The Waiver and Amendment Shares, when issued, shall be deemed to be validly issued, fully paid, and non-assessable shares of the Company’s Common Stock. The Waiver and Amendment Shares shall be deemed fully earned as of the date hereof.
The One-Time Waiver set forth in this letter constitute one-time waivers in respect of the transactions are limited to the matters expressly set forth herein and should not be construed as an indication that the Purchaser has agreed to any other modifications to, consents of, or waivers of any other terms or provisions of the Purchase Agreement or any Transaction Document or of the terms of any other agreement, instrument or security or any modifications to, consents of, or waivers of any default that may exist or occur thereunder.
The Company hereby represents and warrants and covenants to the Purchaser that nothing contained herein or otherwise disclosed to the Purchaser by the Company connection herewith constitutes material non-public information. As of the date hereof, the Company shall have disclosed all material, non-public information (if any) provided up to the date hereof to the Purchaser by the Company or any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents, that has not previously been publicly disclosed by the Company in a filing with the Securities and Exchange Commission.
The Company hereby covenants and agrees that, as of the date hereof, (i) the Purchaser has no confidentiality or similar obligation under any agreement to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents and (ii) the Purchaser has not made any agreement with the Company, any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agent not to purchase or sell, long and/or short, the Common Stock or any other securities of the Company.
This letter agreement shall be governed by and construed in accordance with the laws of the State of Nevada without regard to choice of law principles. Any dispute arising under or relating to or in connection with this letter agreement shall be subject to the exclusive jurisdiction and venue of the State and/or Federal courts located in New York. This letter agreement may be executed in any number of counterparts (including by facsimile, .pdf or other electronic transmission), each of which shall be an original but all of which together shall constitute one and the same instrument.
| Very truly yours, | ||
| AJB CAPITAL INVESTMENTS, LLC | ||
| By: | ||
| Name: | ||
| Title: | ||
Acknowledged and Agreed
as of August 22, 2022
| mPHASE TECHNOLOGIES, INC. | ||
| By: |  |
|
| Name: | Chester White | |
| Title: | Board Member | |
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