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 Exchange Act of 1934
Date of Report (Date of earliest event reported): January 14, 2015
HANGOVER JOE'S HOLDING CORPORATION
(Exact name of registrant as specified in its charter)
| Colorado | 000-525-33 | 20-8097439 |
(State of Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
Nine Music Square South
Nashville, TN 37023
(Address of principal executive offices)
303-872-5939
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications 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)) |
| Item 1.01 | Entry Into A Material Definitive Agreement |
| Item 2.03 | Creation of a Direct Financial Obligation |
| Item 3.02 | Unregistered Sales of Equity Securities |
On February 23, 2015, Hangover Joe's Holding Corporation (the "Company") amended its Articles of Incorporation to increase its authorized shares of common stock from 500,000,000 to 5,000,000,000 (the "Increase Amendment"). The Increase Amendment was approved by the board of directors as well as the shareholders holding a majority of the issued and outstanding shares of common stock pursuant to a written consent dated December 1, 2014.
In addition, on January 2, 2015, the Company entered into a Securities Purchase Agreement with KBM Worldwide, Inc. ("KBM"), for the sale of an 8% convertible note in the principal amount of $43,000 (the "KBM Note"). The financing closed on January 14, 2015.
The KBM Note bears interest at the rate of 8% per annum. All interest and principal must be repaid on October 6, 2015. The KBM Note is convertible into common stock, at KBM's option, at a 45% discount to the average of the three lowest closing bid prices of the common stock during the 10 trading day period prior to conversion. In the event the Company prepays the KBM Note in full, the Company is required to pay off all principal, interest and any other amounts owing multiplied by (i) 115% if prepaid during the period commencing on the closing date through 30 days thereafter, (ii) 120% if prepaid 31 days following the closing through 60 days following the closing and (iii) 125% if prepaid 61 days following the closing through 90 days following the closing and (iv) 130% if prepaid 91 days following the closing through 120 days following the closing and (v) 135% if prepaid 121 days following the closing through 150 days following the closing and (vi) 140% if prepaid 151 days following the closing through 180 days following the closing. After the expiration of 180 days following the date of the KBM Note, the Company has no right of prepayment.
KBM has agreed to restrict its ability to convert the KBM Note and receive shares of common stock such that the number of shares of common stock held by them in the aggregate and their affiliates after such conversion or exercise does not exceed 4.99% of the then issued and outstanding shares of common stock. The total net proceeds the Company received from this Offering was $43,000, less attorneys fees.
As of the date hereof, the Company is obligated on the KBM Note in connection with the offering. The KBM Note is a debt obligation arising other than in the ordinary course of business, which constitutes a direct financial obligation of the Company.
The Company claims an exemption from the registration requirements of the Securities Act of 1933, as amended (the "Act") for the private placement of these securities pursuant to Section 4(2) of the Act and/or Regulation D promulgated there under since, among other things, the above transaction did not involve public a offering. KBM is an accredited investor, had access to information about the Company and its investment, took the securities for investment and not resale, and the Company took appropriate measures to restrict the transfer of the securities.
The foregoing information is a summary of each of the agreements involved in the transactions described above, is not complete, and is qualified in its entirety by reference to the full text of those agreements, each of which is attached an exhibit to this Current Report on Form 8-K. Readers should review those agreements for a complete understanding of the terms and conditions associated with this transaction.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits.
Exhibit Number | | Description |
3.1 | | Certificate of Amendment to the Articles of Incorporation of Hangover Joe's Holding Corporation |
4.1 | | Securities Purchase Agreement by and among the Company and the KBM Worldwide, Inc., dated January 2, 2015 |
| 4.2 | | Convertible Promissory Note issued to KBM Worldwide, Inc. dated January 2, 2015 |
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.
| | HANGOVER JOE'S HOLDING CORPORATION | |
| | | | |
| Date: February 23, 2015 | By: | /s/ Matthew Veal | |
| | | Matthew Veal Interim CEO and Chief Financial Officer | |
