Item
1.01 Entry into a Material Definitive Agreement.
On
February 14, 2023, Propanc Biopharma, Inc. (the “Company”), entered into a securities purchase agreement (the “Purchase
Agreement”) with ONE44 Capital LLC (“ONE44”), pursuant to which ONE44 purchased a convertible promissory note (the
“Note”) from the Company in the aggregate principal amount of $111,111, such principal and the interest thereon convertible
into shares of the Company’s common stock at the option of ONE44. The transaction contemplated by the Purchase Agreement closed
on February 16, 2023. The Company intends to use the net proceeds ($100,000) from the Note for general working capital purposes. The
Note contains an original issue discount amount of $11,111.
The
maturity date of the Note is February 14, 2024 (the “Maturity Date”). The Note bears interest at a rate of 10% per annum.
Interest is payable only in shares of Company’s common stock (the “Common Stock”) and is due and payable only contemporaneously
with a payment of principal, whether at the Maturity Date or upon acceleration or by prepayment, as described below. ONE44 is entitled,
at its option, at any time after the six-month anniversary of the Note, to convert all or any amount of the principal face amount of
this Note then outstanding into shares of Common Stock at a per-share price equal to 60% of the lowest trading price of the Common Stock,
as reported by the OTC Markets Group (if the shares of the Common Stock are then quoted thereon) or by any securities exchange upon which
the Common Stock is then listed, for the ten prior trading days including the day upon which a Notice of Conversion is received by the
Company. In the event the Company experiences a DTC “Chill” on its shares, the conversion price shall then be decreased to
50% instead of 60% while that “Chill” is in effect. Notwithstanding the foregoing, ONE44 shall be restricted from effecting
a conversion if such conversion, along with other shares of Common Stock then beneficially owned by ONE44 and its affiliates, exceeds
4.99% of the outstanding shares of Common Stock (which may be increased up to 9.9% of the outstanding shares of Common Stock upon 60
days’ prior written notice by ONE44 to the Company).
The
Company may prepay the principal of the Note and accrued interest until 180 days from the issuance date (August 13, 2023). If the Note
is prepaid within 60 days of the issuance date (April 15, 2023), then the prepayment premium shall be 120% of the face amount plus any
accrued interest. If the Note is prepaid after 60 days from the issuance date, but less than 120 days from the issuance date (June 14,
2023), then the prepayment premium shall be 130% of the face amount plus any accrued interest. If the Note is prepaid after 120 days
from the issuance date, up to 180 days from the issuance date (August 13, 2023), then the prepayment premium shall be 135% of the face
amount plus any accrued interest. So long as the Note is outstanding, the Company covenants not to, without prior written consent from
ONE44, sell, lease or otherwise dispose of all or substantially all of its assets outside the ordinary course of business which would
render the Company a “shell company” as such term is defined in Rule 144.
Other
than as described above, the Note contains certain events of default, including failure to issue shares timely upon receipt of a notice
of conversion, as well as certain customary events of default, including, among others, breach of covenants, representations, or warranties,
insolvency, bankruptcy, liquidation, and failure by the Company to pay the principal and interest due under the Note. Upon the occurrence
and during the continuation of certain events of default, the Note will accrue an annual interest rate of 24% or, if such rate is usurious
or not permitted by current law, then at the highest rate of interest permitted by law.
The
Note was issued, and any shares of Common Stock to be issued pursuant to any conversion of the Note shall be issued, in a private placement
in reliance upon an exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
The
foregoing descriptions of the Note and the Purchase Agreement do not purport to be complete and each is qualified in its entirety by
reference to the full text of the Note and the Purchase Agreement, which are filed as Exhibits 4.20 and 10.41, respectively, to this
Current Report on Form 8-K and are incorporated herein by reference.