Business Context and Reporting Period
This Form 8-K is a current report filed by MassRoots, Inc. (not Greenwave Technology Solutions, Inc.) on April 2, 2021, covering events occurring between March 10, 2021, and April 1, 2021. The company is a Delaware corporation and an emerging growth company.
Key Financial Metrics and Capital Events
- Capital Raise: The company closed the sale of 3.75 shares of Series X Convertible Preferred Stock to an accredited investor on March 15, 2021, generating proceeds of $75,000.
- Aggregate Proceeds: Including prior sales, the company has received a total of $521,000 from the issuance of Series X Preferred Stock.
- Conversion Terms: Each share of Series X Preferred Stock is convertible into 10,000,000 shares of Common Stock, subject to beneficial ownership limitations (4.99% cap, adjustable to 9.99%) and a pending amendment to the Certificate of Incorporation to authorize sufficient common shares.
- Liquidity and Debt: The filing text does not provide specific values for total cash, debt, or liquidity ratios outside of the specific proceeds mentioned above.
Material Changes and Corporate Actions
- Executive Departure: Jesus M. Quintero resigned as Chief Financial Officer effective March 29, 2021. The resignation was not due to any disagreement with the company.
- Interim Appointment: Isaac Dietrich, the Chief Executive Officer, has assumed the role of interim Chief Financial Officer.
- Transaction Extension: On April 1, 2021, the company entered into a third amendment to a Letter of Intent with Herbfluence, extending the closing deadline for proposed transactions to April 16, 2021.
Outlook, Risks, and Contingencies
- Transaction Uncertainty: The company explicitly states there can be no assurance that the transactions with Herbfluence will be completed on anticipated terms or at all.
- Conversion Restrictions: The Series X Preferred Stock is currently not convertible until the company files and receives effectiveness for an amendment to its Certificate of Incorporation to increase authorized common stock.
- Forward-Looking Statements: The filing includes standard disclaimers that actual results may differ materially from expectations due to various risks and uncertainties.
Investor Verification Checklist
- Verify the status of the amendment to the Certificate of Incorporation required to enable conversion of Series X Preferred Stock.
- Monitor the April 16, 2021 deadline for the Herbfluence transaction to determine if the deal closes or is further extended.
- Confirm the timeline for the appointment of a permanent Chief Financial Officer to replace the interim arrangement.
- Review the full text of the Series X Securities Purchase Agreement and Certificate of Designation (Exhibits 10.1 and 3.1) for detailed rights and preferences.