The most recent 8-K directly contradicts that old 8-K. And I expect the next 10-Q will as well.
Not only has INBI not redeemed the Vicis preferred stock for $8 million cash, they had to borrow an additional $2 million from Vicis (of which $1 miliion went to CD3) for short-term cash requirements just to stay afloat!
Item 1.01 Entry Into a Material Definitive Agreement.
On September 12, 2012, Infusion Brands International, Inc. (the “Company) purchased from CD3 Holdings, Inc. (“CD3”) a promissory note in the principal amount of One Million Dollars ($1,000,000) (the “CD3 Note”), which is due and payable on October 15, 2012 (the “CD3 Maturity Date”). Additionally, under the terms of the CD3 Note, on the CD3 Maturity Date, CD3 shall pay the Company an additional $75,000 payment for reimbursement of legal fees, due diligence and other costs incurred by the Company. CD3 may prepay the CD3 Note, in whole or in part, without penalty, upon not less than three days’ prior notice. Notwithstanding the foregoing, if CD3 consummates an equity or debt financing, all net proceeds realized by CD3 shall be paid towards satisfaction of the CD3 Note. Upon an Event of Default (as defined in the CD3 Note), the entire unpaid principal amount under the CD3 Note shall become due and payable.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On September 12, 2012, the Company sold to Vicis Captial Master Fund (“Vicis”) a promissory note in the principal amount of Two Million Dollars ($2,000,000) (the “Vicis Note’), which is due and payable on October 15, 2012 (the “Vicis Maturity Date’). Additionally, under the terms of the Vicis Note, on the Vicis Maturity Date, the Company shall pay Vicis an additional $150,000 payment for reimbursement of legal fees, due diligence and other costs incurred by Vicis. The Company may prepay the Vicis Note, in whole or in part, without penalty, upon not less than three days’ prior notice. Notwithstanding the foregoing, if the Company consummates an equity or debt financing, all net proceeds realized by the Company shall be paid towards satisfaction of the Vicis Note. Upon an Event of Default (as defined in the Vicis Note), the entire unpaid principal amount under the Vicis Note shall become due and payable.
I wonder if either party was able to pay them back last month when due or are they in default? The next 10-Q should be quite interesting for many reasons.