Axiom Corp. (OTCPK:AXMM) announced that it has entered into securities purchase agreements for private placement of 10% convertible promissory notes with two investors for gross proceeds of $575,000 on October 5, 2015. The notes have principal value of $612,250; carry a fixed annual interest of 10%, and with a maturity date of October 5, 2016. Any amount of principal or interest not paid when due on the notes will bear interest at an annual rate of 24% applied from the due date until the date of payment. The notes carry an original issue discount of $28,750. The company agrees to pay the investor $8,500 to cover certain fees, including legal counsel directly in the amount of $5,000, incurred in connection with the transaction. The conversion price is equal to 60% multiplied by the lowest average trading price for its common stock during the twenty day trading period ending on the latest complete trading day prior to the date of conversion. The company will issue securities pursuant to exemption provided under Regulation D.


In the event the company redeems the notes in full, the company is required to pay off all principal balance, interest and any other amounts owing multiplied by 125%. The agreement restricts the ability of the investors to convert the note and receive shares of common stock such that the number of shares of common stock held by them in the aggregate and their affiliates after such conversion or exercise does not exceed 4.99% of the then issued and outstanding shares of common stock.

The company will receive $250,000 at the time of closing of the agreements, $75,000 upon the filing of a registration statement with the Securities and Exchange Commission, $50,000 upon receipt of the first round of comments from the Securities and Exchange Commission regarding the registrations statement, $100,000 upon the effectiveness of the registration statement, and at its option, $100,000 thirty days after the registration statement becomes effective.