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):October 2, 2017
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REAC GROUP, INC. |
(Exact name of registrant as specified in its charter) |
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Florida | | 000-54845 | | 59-3800845 |
(state or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification Number) |
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8878 Covenant Avenue, Suite 209 Pittsburgh, PA | |
15237 |
(address of principal executive offices) | | (zip code) |
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(724) 656-8886 |
(registrant’s telephone number, including area code) |
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(former name or former address, if changed since last report) |
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:
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Section 1—Registrant’s Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On October 2, 2017 (the “Closing Date”), REAC Group, Inc. (the “Company”) entered into a Securities Purchase Agreement (“SPA”) with an institutional accredited investor (“Investor”) pursuant to which Investor invested $53,000 (the “Financing”). On the Closing Date, the Company issued to Investor a Convertible Promissory Note (the “Note”) in the principal amount of $53,000. There is no material relationship between the Company or its affiliates and the Investor and the Company paid no commissions or other placement agent fees.
The SPA and the Note are collectively referred to herein as the “Transaction Documents.”
The Note matures 10 months after the Closing Date and is convertible into shares of the Company’s common stock at a conversion price equal to 61% of the lowest trading price per share during the previous fifteen (15) trading days. The Company may prepay the Note within 30 days by payment to Investor of 115% of the outstanding principal, interest and other amounts then due under the Note. The prepayment amount increases by 5% for each subsequent 30 day period, up to 180 days where the Company may prepay the Note by payment to Investor of 140% of the outstanding principal, interest and other amounts then due under the Note. After 180 days, the Company will have no right of prepayment.
Pursuant to the terms of the SPA and the Note, the Company is required to reserve and keep available out of its authorized and unissued shares of common stock a number of shares of common stock at least equal to seven (7) times the number of shares issuable on full conversion of the Note.
The foregoing summary description of the terms of the Transaction Documents may not contain all information that is of interest to the reader. For further information regarding the terms of the Transaction Documents, reference is made to such Transaction Documents, which are filed hereto as Exhibits 10.1 and 10.2, and are incorporated herein by this reference.
Section 2—Financial Information
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant
The information provided above in “Item 1.01—Entry into a Material Definitive Agreement” of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Section 3—Securities and Trading Markets
Item 3.02 Unregistered Sales of Equity Securities
The information provided above in “Item 1.01—Entry into a Material Definitive Agreement” of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
The issuance of the Note and the issuance of the shares of the Company’s common stock upon conversion of any part of the outstanding interest or principal amount of the Note is exempt from registration under the Securities Act of 1933, as amended (the “Act”), in reliance on exemptions from the registration requirements of the Act in transactions not involved in a public offering pursuant to Rule 506(b) of Regulation D, as promulgated by the Securities and Exchange Commission under the Act.
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Section 9—Financial Statements and Exhibits.
Item 9.01. Financial Statements and Exhibits.
d.
Exhibits
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NUMBER | EXHIBIT |
10.1 | Convertible Promissory Note |
10.2 | Securities Purchase Agreement |
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.
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| REAC GROUP, INC. |
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November 13, 2017 | /s/ Robert DeAngelis |
| Robert DeAngelis |
| Chief Executive Officer |
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