SMART FOR LIFE, INC.: debt financing — Smart for Life converts $5.8M debt to equity, nets $4.1M from warrant exercise; regains Nasdaq equity compliance

SMART FOR LIFE, INC.

Over $5.8M of debt and $1.2M of executive/board deferred comp converted into Series B preferred stock convertible at $2.23/share.
Warrant inducement: 3,513,750 warrants exercised at $1.30/share for $4.5M gross ($4.1M net); new warrants for 7,027,500 shares at $2.17, 5.5-year term.
Nasdaq granted extension to May 30, 2023; company now has stockholders' equity above $2.5M minimum.
Executive Chairman A. Cervantes converted $827,494 deferred comp into 3,711 Series B shares; CEO D. Minton converted $350,826 into 1,574 shares.
New 6% Secured Subordinated Promissory Note of $1,734,950 issued to Dr. Moulavi for unconverted principal and interest.

item 1.01 item 2.03 item 3.02 item 3.03 item 5.03 item 8.01 item 9.01

Key facts

Extracted from this filing and checked against the source text.

Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

SMART FOR LIFE, INC. incurred loan of $1,734,950 with Dr. Sasson E. Moulavi at 6%.

Instrument: loan
Principal: $1,734,950
Counterparty: Dr. Sasson E. Moulavi
Rate: 6%
Event: incurrence

Exact text from the filing

on May 26, 2023, the Company issued Dr. Moulavi a new 6% Secured Subordinated Promissory Note (the "Moulavi Balance Note"), having identical terms to the Moulavi Note but with a principal amount of $1,734,950

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Source: SEC EDGAR

accession 0001213900-23-043695

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