Item 1.01 Entry into a Material Definitive Agreement.
NovAccess Global Inc., a Colorado corporation ("NovAccess" or the "company"),
previously entered into three securities purchase agreements dated August 20,
2021, February 15, 2022, and May 5, 2022 (collectively, the "Agreements"), with
AJB Capital Investments, LLC ("AJB"). Pursuant to the Agreements, NovAccess
issued promissory notes to AJB representing loans provided by AJB to the company
totaling $1.75 million. Also pursuant to the Agreements, NovAccess paid AJB
commitment fees totaling 1,575,000 unregistered shares of the company's common
stock (the "commitment fee shares"). If AJB is unable to sell the commitment fee
shares for amounts specified in the Agreements, then AJB may require NovAccess
to issue additional shares or pay cash in the amount of the shortfall (the
"make-whole rights"). However, AJB may only exercise its make-whole rights
within time frames following the loan dates specified in the Agreements (the
August 20, 2021 and February 15, 2022 make-whole rights each have a term of 18
months and the May 5, 2022 make-whole rights have a term of 36 months). The
August 20, 2021 make-whole rights expire on February 20 of this year. To avoid
forcing AJB to sell the commitment fee shares in order to take advantage of its
make-whole rights, on January 20, 2023 NovAccess entered into a letter agreement
with AJB extending the exercise period for the make whole-rights to 72 months.
As amended by the letter agreement, the make-whole rights now expire on August
20, 2027, February 15, 2028, and May 5, 2028. The letter agreement makes
additional less material revisions to AJB's make-whole rights and harmonizes the
make-whole rights among the Agreements.
The letter agreement with AJB is filed as an exhibit to this Current Report on
Form 8-K. The description above is qualified in its entirety by reference to the
full text of the agreement.
Item 9.01 Financial Statements and Exhibits.
10.1 Letter Agreement dated January 20, 2023 between NovAccess Global Inc. and
AJB Capital Investments, LLC
Exhibit 104 Cover Page Interactive Data File (formatted as Inline XBRL)
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