CalEthos, Inc. announced that it has entered into a subscription agreement with Nanosha Investments for a private placement of an original issue discount convertible promissory note for gross proceeds of $3,500,000 on September 15, 2021. In addition, the company will issue series A stock purchase warrant to purchase up to 1,540,000 shares of the its common stock, par value $0.001 per share. The note was issued with 10% original issue discount of $350,000 but does not otherwise bear interest, and matures on August 31, 2022. During the first six months following issuance of the note, the investor is not permitted to prepay of all or any portion of the note without the prior written consent of the investor, which consent may be withheld, conditioned or delayed in the investor’s sole and absolute discretion. Other than as set forth in the preceding sentence, the investor may prepay all or any portion of the note at any time without penalty. The outstanding principal amount of the note may be converted at any time at the election of the holder into shares of common stock at an initial conversion price equal to $1.25 per share, subject to adjustment for stock splits, stock combinations and the like, and to an adjustment for future issuances of common stock, warrants or rights to purchase common stock or securities convertible into common stock for a consideration per share that is less than the then-applicable conversion price, subject to certain exceptions. The note is subject to automatic conversion on the effective date of registration of five million or more shares of common stock, including the shares of common stock underlying the note and the warrant, or on the date on which the closing price of the common stock on the over-the-counter markets is at least $3 per share for 60 consecutive days post registration. In the event that we issue any equity securities at a purchase price less than the then-current conversion price, the conversion price shall be reduced to the price at which the new shares are issued. The series A warrant is exercisable to purchase up to 1,540,000 shares of common stock for a purchase price of $1.87 per share, subject to adjustment, at any time on or prior to August 31, 2024. The series A warrant may be exercised at the option of the holder either by the payment of the exercise price in cash or on a cashless basis provided, however, that if the series A warrant is exercised by the payment of the exercise price in cash, the holder will receive, in addition to the shares of common stock otherwise issuable upon exercise of the series A warrant, a three-year series B warrant to purchase a number of shares of common stock equal to the number of shares of common stock acquired upon the exercise in cash of the series A warrant at an exercise price equal to $1.87 per share, subject to certain adjustments. The Finder was paid with warrants to purchase 100,000 shares of common stock. The company has received in funding pursuant to Regulation D from one investors.