Material Agreement - Form 8-K

Item 1.01 Entry into a Material Definitive Agreement.

Financing

Securities Purchase Agreement

On April 16, 2024, Trio Petroleum Corp., a Delaware corporation (the "Company"), entered into a securities purchase agreement (the "SPA") with an institutional investor (the "Investor"). Pursuant to the terms and conditions of the SPA, the Investor provided financing to the Company for gross proceeds in the amount of $360,000 resulting in net proceeds to the Company, after offering expenses, of $310,000 (the "Financing"). The Company also issued to the Investor 750,000 shares of its common stock, par value $0.0001 per share, as and for a commitment fee in connection with the Financing (the "Commitment Shares").

Pursuant to the provisions of the SPA, the Company granted the Investor certain "piggy-back registration rights" for the registration for resale of the Commitment Shares and the Conversion Shares (defined hereafter), Additionally, for a period beginning on April 16, 2024 and terminating 18 months after the later of (i) August 16, 2024 or the full repayment of the Investor Note, the Company provided the Investor with the right to participate in future financings in an amount up to 100% of any debt financing and up to 45% of any other type of financing. Further, the Company is prohibited from entering into any variable rate transactions for as long as the Investor holds any of the Commitment Shares; provided, however, that the Company is permitted to enter into At-the-Market offerings with a nationally recognized broker-dealer. The Company has also agreed to use commercially reasonable efforts to consummate a reverse stock split of its shares of common stock, in the event that it is required in order to maintain the listing of its common stock on the NYSE American.

The SPA also contains customary representations and warranties of the Company and the Investor, indemnification obligations of the Company, termination provisions, and other obligations and rights of the parties.

The Company intends to use the net proceeds raised in the Financing for working capital and general corporate purposes.

The above description of the SPA is qualified in its entirety by the text of the SPA, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K.

Senior Secured Convertible Note

In connection with the Financing, the Company issued a Senior Secured Convertible Promissory Note to the Investor in the principal amount of $400,000, having an original issue discount of $40,000, or 10% (the "Investor Note"). There is no interest payable on the outstanding balance of the Investor Note, unless an Event of Default has occurred, in which case interest will accrue on the outstanding balance of the Investor Note at a rate of 15% per annum until cured (the "Default Interest"). The Company may prepay all or any portion of the Investor Note at any time and must prepay the Investor Note in full from the proceeds of any debt or equity financing of the Company generating, in a single transaction or a series of related transactions, gross proceeds of not less than $1,000,000, during any time that the Investor Note remains outstanding. The maturity date of the Investor Note is August 16, 2024.

The Investor Note is convertible into shares common stock of the Company (the "Conversion Shares") at a per share conversion price of $0.25, subject to certain adjustments. The Investor Note also contains certain beneficial ownership limitations prohibiting the Investor from converting the Investor Note, if any such conversion would result in the Investor's ownership of shares in excess of the applicable beneficial ownership limitation. The Investor Note also contains customary provisions constituting an Event of Default (as such term is defined in the Investor Note) and, in addition to the requirement to pay Default Interest upon an Event of Default, after an Event of Default has existed for at least 15 days without being cured, the Investor Note may be accelerated by the Investor, in which case it will become immediately due and payable.

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