On April 16, 2025 the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending LLC (“Holder”) relating to the issuance and sale of a Convertible Note (the “Note”) with an original principal amount of $94,300 less original issue discount of $12,300 and transaction costs of $7,000 bearing an 10% annual interest rate and maturing February 1, 2026 for $75,000 in cash. After 180 days after the issue date, the Note together with any unpaid accrued interest is convertible into shares of common stock of the Company at the Holder’s option at a variable conversion price calculated at 75% of the lowest closing bid price during the 10 trading days prior to the conversion date. Additionally, the Holder of the Note is entitled to deduct $1,500 from the conversion amount in each note conversion to cover the holder’s deposit fees associated with the conversion. The Company may prepay the Note in cash, if repaid within 90 days of date of issue, at 115% of the original principal amount plus interest, between 91 days and 150 days at 120% of the original principal amount plus interest and between 151 days and 180 days at 125% of the original principal amount plus interest.
"Kramer is a recidivist violator of federal securities laws, having twice agreed, on a no-admit "
"Recently, the Securities and Exchange Commission filed a complaint against Curt Kramer and three companies owned by Kramer, 1800 Diagonal Lending [color=red][/color]Company, LLC, Power Up Lending Group, Ltd., and Geneva Roth Remark Holdings, Inc. (Securities and Exchange Commission v. Power Up Lending Ltd., et al., No. 1:24-cv-03498). The SEC alleges that Kramer, by making convertible loans to microcap companies through 1800 Diagonal, Power Up and Geneva Roth, acted as a securities dealer without having the required securities licenses. To understand the case, and its ramifications, we first need to understand how these loans work"
https://kjk.com/2024/06/20/sec-brings-action-against-convertible-debt-lender/ Why Did the SEC Pursue Kramer? Kramer and his companies aren’t the only ones offering convertible debt to small publicly traded companies. In the complaint, the SEC referred to Kramer as a “two-time recidivist violator of the federal securities laws,” but there appear to be some other reasons why the SEC is pursuing Kramer. In our experience, most of these convertible loans are only convertible if the borrower defaults, meaning that if the borrower repays the loan on time, then the lender does not have the right to convert the loan. For these loans, the conversion right is similar to a type of security that protects the lender — if the borrower is unable to pay, the lender converts and sells shares until the loan is considered repaid. However, most of Kramer’s loans were convertible after six months, regardless of whether the loan was in default, and some were converted in full before they were due (the six-month waiting period complies with SEC Rule 144, which allows a borrower to treat the shares as having been paid for when the loan was made, and freely sell them into the market after six months have elapsed without registration). In these cases, Kramer wasn’t protecting himself when a borrower couldn’t repay a loan. Instead, it appears he made the loans with the intent to convert at a discount and profit by selling the shares in the market. And profit he did. According to the complaint, from January 2018 to March 2023, Kramer’s companies made at least $60 million selling converted shares in the market after investing in approximately 325 issuers in nearly 2,000 transactions and converting loans into more than 90 billion newly-issued shares of common stock. Bearish
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