Replies to post #147645 on Pervasip Corp (PVSP)

[Arthur]

Securities Purchase Agreement

On October 14, 2015 the Company closed on a Securities Purchase Agreement (“SPA”) with TCA Global Credit Master Fund, LP, a Cayman Islands limited partnership, as lender (“ TCA ”). Pursuant to the SPA, TCA agreed to loan the Company up to a maximum of $5 million for working capital and general operating expenses. An initial amount of $500,000 was funded by TCA at the closing of the SPA. Any increase in the amount extended to the Company shall be at the discretion of TCA.

The amounts borrowed pursuant to the Credit Agreement are evidenced by a Senior Secured, Convertible, Redeemable Debenture (the “Debenture”) and the repayment of the Debenture is secured by a first position security interest in substantially all of the Company’s assets in favor of TCA, as evidenced by a security agreement by and between the Company and TCA and a first position security interest in substantially all of the Company’s subsidiaries’ assets in favor of TCA, as evidenced by a security agreement by and among the Company’s subsidiaries and TCA and a pledge agreement for the Company’s ownership of its subsidiaries. The Debenture is in the original principal amount of $500,000, is due and payable, along with interest thereon, on April 14, 2017, and bears interest at the rate of 18% per annum. Principal payments are due in monthly installments beginning in February 2016.

Upon the occurrence of an event of default, TCA may convert all or any portion of the outstanding principal, accrued and unpaid interest, and any other sums due and payable under the Debenture into shares of the Company’s common stock at a conversion price equal to 85% of the lowest daily volume weighted average price of the Company’s common stock during the five trading days immediately prior to such applicable conversion date, in each case subject to TCA not being able to beneficially own more than 4.99% of the Company’s outstanding common stock upon any conversion.

As further consideration for TCA entering into and structuring the SPA, the Company paid TCA an advisory fee of $175,000 by issuing to TCA 17,500 shares of its Series I convertible preferred stock. Additionally, the Company issued 51 shares of its Series J preferred stock to TCA, which gives TCA voting control of the Company if the Company is in default of any agreement with TCA.

The Company used $70,000 of the proceeds of the TCA funding to make its final payment to Laurus (see Note 9). This payment satisfies all remaining debt payable to Laurus, which amounted to $1,859,582 at August 31, 2015. Consequently, the Company will record a trouble debt restructuring gain of approximately $1,790,000 in the fourth quarter of fiscal 2015.

[Cobra Kai]

Yes. I have :)


Pursuant to the SPA, TCA agreed to loan the Company up to a maximum of $5 million for working capital and general operating expenses. An initial amount of $500,000 was funded by TCA at the closing of the SPA


A $70,000 portion of the TCA proceeds was paid to Laurus on October 14, 2015, thereby eliminating the balances due from the Company to Laurus and releasing the security interest and liens filed by Laurus. Consequently, the Company will record a troubled debt restructuring gain of approximately $1,790,000 in the fourth quarter of fiscal 2015.


As of August 31, 2015 and November 30, 2014, the Company owed a third party lender, LV Administrative Services, Ltd., as agent for Laurus Master Fund, Ltd. and various affiliates (“Laurus”), $1,832,141 and $2,266,186, respectively. All of such debt became due by its terms on September 28, 2010. Pursuant to two assignment agreements, in which the Company and Laurus agreed to assign the debt to a third party, the interest rate on the debt was changed to zero percent from January 31, 2012 to April 12, 2013. Beginning on April 12, 2013, the interest rate on the Laurus debt reverted to the rate charged in the original note agreements, which ranges from 5.25% to 20% per annum. The Company has not made payments of principal or interest when due, and is not in compliance with its agreements with Laurus. Laurus has not issued a default notice and had signed an agreement, on two separate occasions, to sell all of its debt at a discount to a third party, however the third parties did not fulfill all of the terms of the agreements and $1,859,582 and $2,266,186 of debt remains due to Laurus at August 31, 2015 and November 30, 2014, respectively