Item 2.01 Completion of Acquisition or Disposition of Assets.
As previously disclosed and incorporated by reference on Form 8-K/A, on August
4, 2022, on May 24, 2022, the Registrant entered into material definitive
agreement with JanOne, Inc., a Nevada corporation ("JanOne"). Pursuant to the
material definitive agreement, the Company bought and assumed, all legal right,
title, and interest to all of the assets, and none of the liabilities, of
JanOne's wholly owned subsidiary, GeoTraq, Inc. ("GeoTraq"), including but not
limited to, all accounts receivable, inventory, 13,500 work in process inventory
chipsets, 170 completed IOT tracker modules, equipment, machinery, tools, rights
under existing warranties, indemnities and insurance benefits, books, records
all goodwill and all intellectual property, including an issued patent
associated with GeoTraq. The aggregate consideration for the asset purchase was
$13,500,000, consisting of the Company's issuance of 30,000,000 shares of
unregistered restricted common stock to JanOne, and a convertible promissory
note ("Note") in the amount of $12,600,000. The Note accrues interest at 8% per
annum, which is agreed to be paid in issuances of restricted common stock
quarterly while the Note is outstanding, subject to a beneficial ownership
limitation of 9.99% after giving effect to the issuance of restricted common
stock. The maturity date is May 24, 2027. There is no prepayment penalty. The
Company entered into the Note on May 24, 2022, along with the material
definitive agreement. On June 16, 2022, the transaction closed by the Company
issuing 30,000,000 restricted common shares to JanOne, completing its
acquisition of the assets.
The foregoing descriptions of the material definitive agreement and Note are
summaries and are qualified in their entirety by reference to the complete text
of the exhibits previously filed on Form 8-K and 8-K/A.
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