Business Context and Reporting Period
This Form 8-K was filed by Conversion Labs, Inc. on May 13, 2019, reporting events occurring on May 8, 2019. The filing details a material definitive agreement involving LegalSimpli Software, LLC ("LSS"), a majority-owned subsidiary of the Company, and Conversion Labs PR LLC ("CVLB PR"), another majority-owned subsidiary.
Key Financial Metrics
The filing does not provide consolidated revenue, profit, cash flow, or margin data. The specific financial instrument disclosed is an amended promissory note with the following terms:
- Principal Amount: $379,730
- Interest Rate: 12% per annum
- Maturity Date: June 1, 2020
- Prepayment: Allowed without penalty
- Collateral: Secured by a lien on substantially all of LSS's assets
Material Changes
The Amended Note replaces and supersedes a prior promissory note dated June 1, 2018, and a Line of Credit Agreement dated May 29, 2018. The transaction consolidates these previous obligations into a single instrument with a defined maturity date and a 12% interest rate.
Outlook, Risks, and Contingencies
The agreement includes standard event of default provisions and covenants. In the event of a default, CVLB PR holds the right to exercise remedies under the Security Agreement and the Amended Note, including the right of set-off against LSS assets. The filing does not contain forward-looking guidance, management commentary on future performance, or other unusual items.
Investor Verification Checklist
- Verify the total outstanding debt obligations of Conversion Labs, Inc. and its subsidiaries beyond this specific note.
- Review the full text of the Amended Note (Exhibit 10.1) and Security Agreement (Exhibit 10.2) for specific default triggers and covenants.
- Confirm the current liquidity position of LSS to assess the risk of default on the $379,730 obligation.
- Check for any subsequent filings regarding the repayment or further amendment of this note.