QHSLab, Inc. announced it has entered into Securities Purchase Agreement with lead investor Mercer Street Global Opportunity Fund, LLC, a fund managed by Mercer Street Capital Partners, LLC pursuant to which the company will issue secured convertible promissory note and warrants to purchase 550,000 shares of the company's common stock for gross proceeds of $400,000 on July 21, 2022. The principal amount of the note is $440,000, which is issued at a discount of $40,000 and will mature after 12 months. The principal amount of the note and all interest accrued thereon is payable on July 21, 2023 and are secured by a lien on substantially all of the company's assets.

The note provides for interest at the rate of 5% per annum, payable at maturity, and is convertible into common stock at a price of $0.20 per share. The 550,000 Warrants are initially exercisable for a period of three years at a price of $0.50 per share, subject to customary anti-dilution adjustments upon the occurrence of certain corporate events as set forth in the Warrant. For services rendered in connection with the Securities Purchase Agreement the company paid Carter, Terry & Company a cash fee of $20,000.

In addition, the company reimbursed the investor $5,000 for legal expenses incurred in connection with the transaction.