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$1.8M in default notes hit on March 28th

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SilverBack   Monday, 03/26/18 09:58:14 PM
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$1.8M in default notes hit on March 28th per the last 8K and agreement with EMA.

On January 30, 2018, Omagine, Inc. (the “Company”) received written notice (“Notice”) from EMA Financial, LLC (“EMA” or the “Lender”) that an event of default had occurred with respect to the Convertible Promissory Note issued by the Company in favor of EMA on September 28, 2017 (the “Note”). The Lender advised the Company that the default occurred because of, among other things, the failure to reserve a sufficient number of shares of the Company’s $0.001 par value common stock (“Common Stock”) for possible future issuance to the Lender, and for the breach of representations and warranties under the Note. As of the Notice date, considering default penalties, twenty four percent accrued interest and application of a default calculation, the alleged outstanding balance of the Note as calculated by EMA is $1,868,313. The Company does not agree with such outstanding balance as calculated by EMA. EMA has demanded full payment from the Company and reserves all rights and remedies available to it under the Note and related transaction documents.

The Note and Securities Purchase Agreement were filed as Exhibits to the Company’s Current Report on Form 8-K filed with the Securities & Exchange Commission on October 18, 2017 and incorporated herein by reference. The foregoing summary of the Notice does not purport to be complete and is qualified in its entirety by reference to the full text of the Notice attached hereto as Exhibit 10.1.

As previously disclosed, pursuant to the Note the Company is obligated to increase the number of its authorized common shares (“Common Shares”) in order to reserve an agreed number of such Common Shares for possible future issuance to the Lender. The Company was of the opinion that this increase could have been accomplished via the written consent of a majority of its shareholders without the necessity of a proxy filing and meeting of its shareholders. This turned out to be inaccurate and the Company now understands that such a proxy filing and meeting is required and the Company presently intends to file such proxy and schedule and conduct such meeting.

Omagine, Inc. (the ”Company”) and EMA Financial, LLC (“EMA”), an accredited investor, entered into a convertible promissory note dated September 28, 2017 (the “EMA Convertible Note” or the “Note”) for the principal amount of $55,000. Funding pursuant to the Note will be received following the filing of this Form 8-K.

1.1. Conversion Right . The Holder shall have the right, in its sole and absolute discretion, as of one hundred eighty (180) days after the Issue Date, to convert all or any part of the outstanding amount due under this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the conversion price (the “Conversion Price”) determined as provided herein (a “Conversion”); provided , however , that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.9% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulation 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided , further , however , that the limitations on conversion may be waived by the Holder upon, at the election of the Holder, not less than 61 days’ prior notice to the Borrower, and the provisions of the conversion limitation shall continue to apply until such 61st day (or such later date, as determined by the Holder, as may be specified in such notice of waiver). The number of shares of Common Stock to be issued upon each Conversion of this Note (“Conversion Shares”) shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 11:59 p.m., New York, New York time on such conversion date (the “Conversion Date”). The term “Conversion Amount” means, with respect to any Conversion of this Note, the sum of (1) the principal amount of this Note to be converted in such Conversion, plus (2) accrued and unpaid interest, if any, on such principal amount being converted at the interest rates provided in this Note to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2), plus (4) any Additional Principal for such Conversion, plus (5) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 1.2(c) and 1.4(g) hereof.



Everything is IMHO. Do your own DD. I don't make you push buttons. You do. Glad I could clear that up for you.
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