Item 1.01 Entry into a Material Definitive
Agreement.
On August 24, 2022 (the “Issue Date”),
Home Bistro, Inc., a Nevada corporation (the “Company”), entered into a certain Securities Purchase Agreement dated
as of August 24, 2022 (the “SPA”), by and between the Company and 1800 Diagonal Lending LLC, a Virginia limited liability
company (the “Investor”). Pursuant to the SPA, among other things, the Company agreed to issue to the Investor a convertible
note in the original principal amount of $104,250.00 (the “Note,” and together
with the SPA, the “Agreements”). Upon closing, the Company received $104,250.00
in gross proceeds from the Investor.
The Note accrues interest at an annual interest
rate of 8% and a default interest rate of 22%, and matures on August 24, 2023 (the “Maturity Date”). The Investor may
convert the Note into shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”),
180 days after the Issue Date until the later of (i) the Maturity Date and (ii) the date the Company pays any amounts owed in connection
with an event of default. The per share conversion price into which the Note is convertible into shares of Common Stock (the “Conversion
Price”) is 65% multiplied by the average of the lowest two closing bid prices for the Common Stock during the ten trading days
ending on the last trading day prior to the conversion date.
The Company has the right to prepay the outstanding
principal amount of the Note, plus any accrued interest on the outstanding principal (including any default interest) at a rate of (x)
120% during the period ending 120 days after the Issue Date and (y) 125% during the period between 121 days and 180 days after the Issue
Date. The Company does not have a prepayment right following the expiration of the 180 day period.
Upon the occurrence and during the continuation
of any event of default under the Note, the Note becomes immediately due and payable and the Company is obligated to pay the Investor
in full satisfaction of its obligations thereunder an amount equal to the greater of (i) the principal amount then outstanding plus accrued
interest (including any default interest) through the date of full repayment multiplied by 150% and (ii)(a) the highest number of shares
of Common Stock issuable upon conversion of the default sum at the Conversion Price, multiplied by (b) the highest closing price for the
Common Stock during the period beginning on the date of first occurrence of the event of default and ending one day prior to the mandatory
prepayment date.
The obligations
under the Note are not secured by any assets of the Company.
The
Agreements contain other provisions, covenants and restrictions common with this type of debt transaction. Furthermore, the Company is
subject to negative covenants under the Agreements, which the Company also believes are also customary for transactions of this type.
The preceding summaries of the SPA and the Note
do not purport to be complete and are qualified in their entirety by reference to the full text of the SPA and the Note, which are filed
as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
The Agreements have been included as exhibits
to this Current Report on Form 8-K to provide investors and securityholders with information regarding certain of its terms. This information
is not intended to provide any financial or other information about the parties to the Agreements or their respective subsidiaries or
affiliates. The representations, warranties and covenants contained in the Agreements are made only for purposes of the Agreements and
as of the date of the Agreements, are solely for the benefit of the parties to the Agreements, may be subject to limitations agreed upon
by the parties, and may be subject to standards of materiality applicable to the parties that differ from those applicable to investors.
Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual
state of facts or condition of the parties to the Agreements or any of their respective subsidiaries or affiliates. Moreover, information
concerning the subject matter of the representations, warranties and covenants may change after the date of the Agreements, and such subsequent
information may not be fully reflected in public disclosures by the parties to the Agreements. The information in the Agreements should
be considered in conjunction with the entirety of the factual disclosure about the Company in the Company’s public reports filed
with the Securities and Exchange Commission (the “SEC”).