CEO of Limitless X (LIMX) settles $50,000 bonus in preferred stock
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Limitless X Holdings Inc. approved a binding Memorandum of Understanding with CEO and chairman Jaspreet Mathur to settle previously promised bonus and incentive compensation valued at $50,000. Instead of cash, the company will issue 550,000 shares of its Class B Convertible Preferred Stock as full payment for these bonuses.
The Class B preferred shares carry no voting rights and no dividends, but each has a $3.00 per share liquidation preference, ranking ahead of common stock and behind Class A preferred. Each preferred share is convertible, at the holder’s option, into 0.067 shares of common stock, subject to a beneficial-ownership cap that generally limits Mathur’s post-conversion stake to 4.99% of outstanding common stock, with an option to increase this cap to 9.99%. The shares will be issued as restricted securities under the Securities Act.
Positive
- None.
Negative
- None.
8-K Event Classification
4 items: 1.01, 2.03, 3.02, 9.01
4 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 3.02
Unregistered Sales of Equity Securities
Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Settled bonus amount: $50,000
Class B preferred shares issued: 550,000 shares
Liquidation preference: $3.00 per share
+3 more
6 metrics
Settled bonus amount
$50,000
Benefits previously promised to CEO under offer letter
Class B preferred shares issued
550,000 shares
Stock compensation to CEO in lieu of cash bonuses
Liquidation preference
$3.00 per share
Priority ahead of common stock, junior to Class A preferred
Conversion ratio
0.067 common shares per preferred share
Holder-option conversion terms for Class B stock
Beneficial ownership cap
4.99%
Standard post-conversion ownership limit for holder and affiliates
Increased ownership cap option
9.99%
Maximum cap attainable at holder’s election on conversion
Key Terms
Memorandum of Understanding, Class B Convertible Preferred Stock, liquidation preference, beneficial-ownership cap, +1 more
5 terms
Memorandum of Understanding regulatory
"entered into a binding Memorandum of Understanding for Stock Issuance Settlement"
A memorandum of understanding (MOU) is a formal agreement between two or more parties that outlines their shared intentions and plans to work together. It acts like a handshake in writing, clarifying each side’s roles and expectations before any official contract is signed. For investors, an MOU signals that parties are serious about collaboration, which can influence future business opportunities and potential growth.
Class B Convertible Preferred Stock financial
"a total of 550,000 shares of the Company’s Class B Convertible Preferred Stock"
liquidation preference financial
"Each share of Class B Stock is entitled to a liquidation preference of $3.00 per share"
A liquidation preference is a rule that determines who gets paid first and how much they receive when a company is sold, goes bankrupt, or distributes its assets. It gives certain investors a priority claim—often returning their original investment plus any agreed multiple—before other owners receive money, which shapes how much common shareholders and founders ultimately get; think of it as a front-of-the-line pass that affects payout order and investor returns.
beneficial-ownership cap regulatory
"subject to a beneficial-ownership cap if, after giving effect to the conversion"
restricted securities regulatory
"The Class B Preferred Shares will be restricted securities under the Securities Act of 1933"
Restricted securities are shares or other investment instruments that come with legal or contractual limits on when and how they can be sold, like stock given to founders or bought in a private offering. Think of them as assets in a locked box that can’t be freely traded until certain conditions — such as a waiting period, company registration, or specific approvals — are met. For investors this matters because restricted securities are less liquid and can affect timing, price, and perceived value when they eventually enter the market.
FAQ
What agreement did Limitless X Holdings Inc. (LIMX) enter with its CEO?
Limitless X entered a binding Memorandum of Understanding with CEO Jaspreet Mathur to settle previously promised bonus and incentive compensation. The settlement substitutes stock-based payment in Class B Convertible Preferred Stock for cash bonuses.
How much compensation is being settled for LIMX’s CEO Jaspreet Mathur?
The agreement settles benefits previously promised to Jaspreet Mathur in the amount of $50,000. This covers bonus and incentive stock compensation tied to his offer letter and efforts such as securing celebrity contracts for the company.
What are the key rights of Limitless X’s Class B Convertible Preferred Stock?
Class B Convertible Preferred Stock has no voting rights and earns no dividends. Each share carries a $3.00 liquidation preference and is senior to common stock but junior to Class A preferred in liquidation priority.