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Item 1.01.
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Entry
into a Material Definitive Agreement.
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On
March 7, 2019, ParkerVision, Inc. (the “
Company
”) consummated the sale of a convertible promissory note with
a face value of $200,000. In addition, on March 11, 2019, the Company consummated the sale of an additional convertible promissory
note on the same terms and conditions with a face value of $50,000. These notes were issued pursuant to a securities purchase
agreement dated February 25, 2019, as previously reported on a Current Report on Form 8-K filed March 4, 2019.
In addition, on March 13, 2019, the Company consummated the sale
of additional convertible promissory notes (the “
Notes
”) for aggregate proceeds of $250,000. In connection with
the transaction, the Company entered into a securities purchase agreement (the “
Purchase Agreement
”) with accredited
investors identified on Exhibit 10.4 hereof (the “
Holders
”) which provides for the sale of the Notes. The Notes
are convertible at any time and from time to time by the Holders into shares (the “
Shares
”) of the Company’s
common stock, par value $0.01 per share (“
Common Stock
”) at a fixed conversion price of $0.25 per share. Any
unconverted, outstanding principal amount of the Notes is payable on the five year anniversary of the Note issuance date (the “
Issuance
Date
”).
At any time following the one-year anniversary of the Issuance Date,
the Company may prepay the then outstanding principal amount of the Note, along with any accrued interest, at cash premium of 125%
prior to the two-year anniversary, 120% prior to the three-year anniversary, 115% prior to the four-year anniversary or 110% thereafter.
Interest accrues at a rate of 8% per annum on each Note, and is
payable quarterly either in cash, shares of Common Stock, or a combination thereof at the Company’s option, subject to certain
equity conditions, beginning on the earlier of (i) the ninety (90) day anniversary of the Issuance Date, provided that a registration
statement for the underlying shares has been declared effective, or (ii) the first quarterly anniversary of the Issuance Date following
the effective date of registration of the underlying shares.
The Notes provide for events of default that include (i) failure
to pay principal or interest when due, (ii) any breach of any of the representations, warranties, covenants or agreements made
by the Company in the Purchase Agreement or Notes, (iii) events of liquidation or bankruptcy, and (iii) a change in control. In
the event of default, the interest rate increases to 12% per annum and the outstanding principal balance of the Notes plus all
accrued interest due may be declared immediately payable by the holders of a majority of the then outstanding principal balance
of the Notes.
The Company also entered into a registration rights agreement (the
“
Registration Rights Agreement
”) with the Holders pursuant to which the Company will register the shares of
Common Stock underlying the Notes. The Company has committed to file the registration statement by the 60
th
calendar
day following the Issuance Date and to cause the registration statement to become effective by the 120
th
calendar day
following the Issuance Date. The Registration Rights Agreement provides for liquidated damages upon the occurrence of certain events
including failure by the Company to file the registration statement or cause it to become effective by the deadlines set forth
above. The amount of the liquidated damages is 1.0% of the aggregate subscription amount paid by the Holders for the Notes upon
the occurrence of the event, and monthly thereafter, up to a maximum of 6%.
The Notes were offered and sold solely to accredited investors on
a private placement basis under Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder.
The foregoing summaries of the Purchase Agreement,
the Notes and the Registration Rights Agreement are qualified in their entirety by reference to the full text of the agreements,
which are attached as part of Exhibits 10.1, 10.2 and 10.3 hereto and are incorporated herein by reference.