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ANYI > SEC Filings for ANYI > Form 8-K on 13-Aug-2014All Recent SEC Filings

Show all filings for ANYTHINGIT, INC.

Form 8-K for ANYTHINGIT, INC.


13-Aug-2014

Entry into a Material Definitive Agreement, Creation of a Direct Financial Oblig


ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

Convertible Notes to Adar Bays, LLC

On August 4, 2014 (the "Note I Issuance Date" and "Note II Issuance Date"), AnythingIT, Inc. (the "Company") entered into a securities purchase agreement (the "Purchase Agreement") with Adar Bays, LLC ("Adar") (collectively, the "Parties"), whereby Adar agreed to invest $105,000.00 into the Company in exchange for the Company's issuance of two convertible promissory notes, each in the original principal amount of $52,500.00, which bear interest at 8% per annum ("Note I" and "Note II"). All outstanding principal and accrued interest on Note I and Note II is due and payable on the maturity date, which is August 4, 2015 (the "Note I Maturity Date" and "Note II Maturity Date"). The Company paid legal fees of $2,500.00 on both Note I and Note II, for a total of $5,000.00, and is using the remaining net proceeds for working capital.

The Note I Purchase Price was paid to the Company in cash by Adar on August 6, 2014. Note I is convertible by Adar at any time into shares of the Company's common stock ("Common Stock"), at a conversion price for each share equal to 50% of the lowest trading price of the common stock as reported on the relevant exchange for the fifteen prior trading days. Interest on any unpaid principal balance of Note I may be paid by the Company with Common Stock. The Company may prepay Note I within 90 days of the Note I Issuance Date by paying 130% of the outstanding principal plus any accrued but unpaid interest. The Company may prepay Note I after 90 days, but before 181 days, after the Note I Issuance Date, by paying 145% of the outstanding principal plus any accrued but unpaid interest. Note I cannot be prepaid after the 180th day.

The Note II Purchase Price was initially paid to the Company by Adar's issuance of an offsetting Note III on the Note II Issuance Date. Note II is convertible into Common Stock by Adar after the expiration of the requisite Rule 144 holding period and full cash payment by Adar to the Company of all principal and interest due under Note III, at a conversion price for each share equal to 50% of the lowest trading price of the common stock as reported on the relevant exchange for the fifteen prior trading days. The Company may not prepay Note
II. However, if Note I is prepaid by the Company within 180 days of the Note II Issuance Date, then all of the Company's and Adar's obligations under Note II and Note III will be deemed satisfied, and Note II and Note III will be cancelled in full. The Company may terminate Note II before six months has elapsed from the Note II Issuance Date, by cancelling Note II and Note
III. Thus, if Note II is cancelled, or if the Company does not meet the "current information requirements" required under Rule 144 of the Securities Act of 1933, as amended ("Securities Act"), then the Parties' obligations under Note II and Note III will be cancelled in full.

All amounts due under Note I and Note II become immediately due and payable by the Company upon the occurrence of an event of default, including but not limited to (i) the Company's failure to pay the amounts due at maturity under any promissory note issued to Adar by the Company, (ii) the Company's failure to deliver shares of Common Stock upon any conversion of Note I and Note II, respectively, (iii) a breach of the covenants (subject to cure period), representations or warranties under Note I or Note II, respectively, (iv) the appointment of a trustee or liquidator (subject to a cure period), a judgment against the Company in excess of $50,000 (subject to a cure period), or the filing of a bankruptcy petition, or (v) failure to remain current in our reporting obligations under the Securities Exchange Act of 1934 or the removal of our common stock from quotation on the OTC Bulletin Board or similar over the counter quotation service.

The Company claims an exemption from the registration requirements of the Securities Act, for the private placement of these securities pursuant to
Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder because, among other things, the transaction did not involve a public offering, Adar is an accredited investor, Adar acquired the securities for investment and not resale, and the Company took appropriate measures to restrict the transfer of the securities.

Convertible Note from Adar Bays, LLC

On August 4, 2014 (the "Note III Issuance Date"), Adar issued to the Company a convertible promissory back end note (the "Note III") in the original principal amount of $52,500.00 (the "Note III Purchase Price"), which bears simple interest at the rate of 8%. Note III has been initially secured by the Company's issuance of Note II. All outstanding principal and accrued interest on the Note II is due and payable on the maturity date, which is April 4, 2015 (the "Note III Maturity Date"). However, if Note II is cancelled by the Company as described above, or if the Company does not meet the "current information requirements" required under Rule 144 of the Securities Act, then the Parties' obligations under Note II and Note III will be cancelled in full. Adar may prepay Note III at any time. Adar may exchange Note III for other collateral with an appraised value of at least $52,500.00 by providing three days prior written notice to the Company, if the Company does not object within those three days. All amounts due under Note III become immediately due and payable by Adar upon the occurrence of an event of default, including but not limited to (i) Adar's failure to pay the amounts due at maturity or (ii) the initiation of any bankruptcy or insolvency proceedings by or against Adar (subject to a cure period and/or waiver by the Company).


Convertible Note to KBM Worldwide, Inc.

On August 11, 2014 (the "Note IV Issuance Date"), the Company issued a convertible promissory note ("Note IV") to KBM Worldwide, Inc. ("KBM"), in the original principal amount of $10,500.00 (the "Note IV Purchase Price"), which bears interest at 8% per annum. All outstanding principal and accrued interest on Note IV is due and payable on the maturity date, which is May 13, 2015 (the "Note IV Maturity Date"). The Note IV Purchase Price was paid in cash to the Company by KBM on August 13, 2014. Any amount of principal or interest that is due under Note IV, which is not paid by the Note IV Maturity Date, will bear interest at the rate of 22% per annum until it is paid ("Default Interest"). Note IV is convertible by KBM into Common Stock at any time during the conversion period, which begins 180 days after the Note IV Issuance Date and ends on the later of (i) the Note IV Maturity Date and the (ii) date of payment . . .



ITEM 2.03 CREATION OF 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.



ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits

 Exhibit   Description
  4.1      Convertible Promissory Note between AnythingIT, Inc. and Adar
           Bays, LLC dated August 4, 2014.
  4.2      Convertible Promissory Back End Note between AnythingIT, Inc. and
           Adar Bays, LLC dated August 4, 2014.
  4.3      Collateralized Convertible Promissory Back End Note between Adar
           Bays, LLC and AnythingIT, Inc. dated August 4, 2014.
  4.4      Convertible Promissory Note between AnythingIT, Inc. and KBM
           Worldwide, Inc. dated August 11, 2014.
  4.5      Convertible Promissory Note between AnythingIT, Inc. and JMJ
           Financial dated August 1, 2014.
  10.1     Securities Purchase Agreement between AnythingIT, Inc. and Adar
           Bays, LLC dated August 4, 2014.


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