UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities and Exchange Act of 1934
Date of
Report (Date of earliest reported): March 9, 2010
WELLSTAR INTERNATIONAL,
INC.
(Exact
name of registrant as specified in charter)
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Nevada
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333-130295
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20-1834908
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(State or Other Jurisdiction
of
Incorporation
or Organization)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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6911
Pilliod Road
Holland,
Ohio 43528
(Address
of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code:
(419) 865-0069
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry
Into A Material Definitive Agreement
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Item
3.02
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Unregistered
Sales of Equity Securities.
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On May
22, 2009 Wellstar International, Inc. ("Wellstar" or the "Company") issued a
Convertible Promissory Note to JMJ Financial (“JMJ”) in aggregate principal
amounts of $575,000 (the “Initial JMJ Note”). In consideration for
Wellstar’s issuing of the Initial JMJ Note, JMJ issued Wellstar a Secured and
Collateralized Promissory Note in the principle amount of $500,000 (the “Initial
Wellstar Note”).
In
addition, on August 19, 2009 Wellstar issued a Convertible Promissory Note to
JMJ in the aggregate principal amount of $1,150,000 (the “Second JMJ Note” and
together with the Initial JMJ Note, the “JMJ Notes”). In
consideration for Wellstar’s issuing of the Second JMJ Note, JMJ issued
Wellstar a Secured and Collateralized Promissory Note in the
principle amount of $1,000,000 (the “Second Wellstar Note” and together with the
Initial Wellstar Note, the “Wellstar Notes”).
The JMJ
Notes bear interest at 12%, mature three years from the date of issuance, and
were convertible into our common stock, at JMJ’s option, at a conversion price,
equal to 65% of the lowest trade for our common stock during the 20 trading days
prior to the conversion. On March 9, 2010, the Company and JMJ
amended the JMJ Notes to reduce the conversion price to 35% of the lowest trade
price during the 20 days previous to the conversion. Prior to the
conversion of the JMJ Notes, JMJ must make a payment to Wellstar reducing the
amount owed to Wellstar under the Wellstar Notes. As of March 15,
2010, the lowest trade for our common stock during the 20 trading days as
reported on the Over-The-Counter Bulletin Board was $.0014 and, therefore, the
conversion price for the JMJ Notes was $.00049. Based on this conversion price,
the JMJ Notes in the aggregate amount of approximately $1,650,000, excluding
interest, are convertible into 3.4 billion shares of our common
stock.
JMJ has
agreed to restrict their ability to convert the JMJ Notes and receive shares of
common stock such that the number of shares of common stock held by them in the
aggregate and their affiliates after such conversion or exercise does not exceed
4.99% of the then issued and outstanding shares of common stock.
The
Wellstar Notes bear interest at the rate of 13.8% per annum and mature three
years from the date of issuance. No interest or principal
payments are required until the maturity date, but both principal and interest
may be prepaid prior to Maturity Date. The Wellstar Notes are secured
by units of STIC AIM Liquidity Portfolio Select Investment Select Investment
Fund (the “JMJ Collateral”). On each of the Wellstar Notes, JMJ has
agreed to pay down the principal of the Wellstar Notes commencing 210 days after
the original issuance of the Wellstar Notes, however, JMJ may adjust the payment
schedule within its sole discretion. In the event that JMJ defaults
on the Wellstar Notes, Wellstar may take possession of the JMJ
collateral.
The JMJ
Notes were offered and sold to JMJ in a private placement transaction made in
reliance upon exemptions from registration pursuant to Section 4(2) under the
Securities Act of 1933 and Rule 506 promulgated thereunder. JMJ is an accredited
investor as defined in Rule 501 of Regulation D promulgated under the Securities
Act of 1933.
The
foregoing information is a summary of each of the agreements involved in the
transactions described above, is not complete, and is qualified in its entirety
by reference to the full text of those agreements, each of which is attached an
exhibit to this Current Report on Form 8-K. Readers should review
those agreements for a complete understanding of the terms and conditions
associated with this transaction.
Item
9.01 Financial Statements and Exhibits
(c)
Exhibits.
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Exhibit
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Number
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Description
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4.1
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Form
of Convertible Promissory Note issued by Wellstar International Inc. to
JMJ
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Financial
(1)
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4.2
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Form
of Secured and Collateralized Promissory Note issued by JMJ Financial to
Wellstar International, Inc. (1)
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4.3
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Amendment
to the May 22, 2009 Convertible Promissory Note by Wellstar International
Inc. to JMJ Financial
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4.4
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Amendment
to the August 19, 2009 Convertible Promissory Note by Wellstar
International Inc. to JMJ Financial
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(1) Incorporated
by reference to the Form 8-K Current Report filed by the Securities and Exchange
Commission on May 22, 2009
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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WELLSTAR
INTERNATIONAL, INC.
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Date:
March 12, 2010
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By:
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/s/ John
Antonio
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Name:
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John
Antonio
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Title:
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CEO
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