Item 1.03 Bankruptcy or Receivership.





Chapter 11 Filing

On August 28, 2020, IronClad Encryption Corporation ("IronClad" or the "Company") filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11 Case") in the United States Bankruptcy Court for the Southern District of Texas (the "Bankruptcy Court").

The Company will continue to operate its business as a "debtor-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.

The bankruptcy petition and other documents filed by IronClad as debtor are available at the court's Internet home page http://www.txs.uscourts.gov/ or at the Clerk's Office, United States Bankruptcy Court, P. O. Box 61010, Houston, Texas 77208. The assigned case number is 20-34332.

Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.

The filing of the Chapter 11 Case described above in Item 1.03 constitutes an event of default that accelerated IronClad's obligations under the following unsecured debt instruments (the "Debt Instruments"):

$108,925.00 in outstanding aggregate principal amount of the 12% Convertible Note dated 2018 October 26.

$ 15,300.00 in outstanding aggregate principal amount of the 10% Convertible Note dated 2019 February 14.

$ 23,260.00 in outstanding aggregate principal amount of the 12% Convertible Note dated 2019 February 14.

$108,486.00 in outstanding aggregate principal amount of the 09% Convertible Note dated 2018 July 19.

$ 53,650.00 in outstanding aggregate principal amount of the 12% Convertible Note dated 2019 April 01.

$ 39,276.00 in outstanding aggregate principal amount of the 12% Convertible Note dated 2019 April 23.

$126,000.00 in outstanding aggregate principal amount of the 10% Convertible Note dated 2019 May 19.

$ 66,400.00 in outstanding aggregate principal amount of the 08% Convertible Note dated 2019 October 01.

$150,000.00 in outstanding aggregate principal amount of the 10% Convertible Note dated 2019 October 31.

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$ 61,584.49 in outstanding aggregate principal amount of the 01% Note dated 2020 April 20.

The Debt Instruments provide that, as a result of the Chapter 11 Case, the principal and interest due thereunder shall be immediately due and payable. Any efforts to enforce such payment obligations under the Debt Instruments are automatically stayed as a result of the Chapter 11 Case, and the creditors' rights of enforcement in respect of the Debt Instruments are subject to the applicable provisions of the Bankruptcy Code.




Item 8.01   Other Events

Cautionary Note about Trading in IronClad's Common Stock

The Company cautions that trading in its securities during the pendency of the Bankruptcy Petitions is highly speculative and poses substantial risks. Trading prices for the Company's securities may bear little or no relationship to the probable outcome for equity security holders at the conclusion of the proceeding in Bankruptcy Court described above.

IronClad expects that its equity holders could experience a significant or complete loss of the value of their investment, depending on the outcome of the Chapter 11 Case.

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