Hydrocarb gets default note concerning Darling note, disputes claims

Typenex lifts coupon to 22% default rate, demands 15% more principal

By Devika Patel

Knoxville, Tenn., Dec. 2 – Hydrocarb Energy Corp. received a default notice regarding a secured convertible promissory note held by Typenex Co-Investment, LLC on Nov. 25, according to an 8-K filed Wednesday with the Securities and Exchange Commission. The note was issued in an Oct. 16 private placement.

The company said in the filing that it “vehemently disagrees with the default notice in every regard.”

The investor notified the company that the Nov. 17 sale of a $200,000 convertible short-term cash redeemable note to Darling Capital, LLC constituted a “variable security” that resulted in a breach of the Typenex note’s provisions because the company did not seek approval from Typenex for the November sale as required by the Typenex note.

The default notice also demands a 22% default interest on the Typenex note. Typenex informed the company that it seeks to increase the note’s balance by 15%, or $259,500, to $2,006,429 and also intends to foreclose on 3.1 million common shares that secure the note.

On Nov. 30, the company received a formal notice from Typenex demanding the $2,006,429 payment the investor alleges is owed by Dec. 2.

Hydrocarb said in Wednesday’s filing that it does not believe the Darling note was a “variable security,” since it is not convertible unless it is not repaid within 180 days, and that the company disagrees with the default claim.

In addition, the company noted in the filing, even if there were a default, Typenex must provide the company a 15-day cure period in order to fix the default, which it has failed to do.

The petroleum exploration company is based in Houston.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.