Current Report Filing (8-k)
January 03 2020 - 5:29PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December
31, 2019
Red Cat Holdings, Inc.
(Exact name of registrant as specified in charter)
Nevada
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000-31587
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86-0490034
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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1607 Ponce de Leon Ave, Suite 407
San Juan, PR
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00909
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (833)
373-3228
N/A
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(Former name or former address, if changed since last report)
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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:
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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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Securities registered pursuant to Section 12(b)
of the Act:
Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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None
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N/A
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N/A
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Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth
company ☐
If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 1.01
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Entry into a Material Definitive Agreement.
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On December 31, 2019, Red Cat Holdings, Inc.,
a Nevada corporation (the “Company”), entered into an Agreement of Merger (the “Merger Agreement”) with
Rotor Riot Acquisition Corp., a newly-formed, wholly-owned Ohio subsidiary of the Company (“Acquisition Sub”), Rotor
Riot, LLC, an Ohio limited liability company (“Rotor Riot”), and the selling holder signatories thereto (the “Members”).
Pursuant to the terms of the Merger Agreement, the issued and outstanding membership interests of Rotor Riot held by the three
Members, which represents 100% of Rotor Riot’s issued and outstanding membership interests, will be converted into shares
of common stock of the Company. Upon the consummation of the merger contemplated by the Merger Agreement (the “Merger”),
the Acquisition Sub will merge with and into Rotor Riot, a provider of high-performance FPV (first-person view) drone technology,
with Rotor Riot continuing as the surviving entity and a wholly-owned subsidiary of the Company.
At the closing of the Merger, each Member will
receive its pro rata portion of the total number of shares of the Company’s common stock issued based on (A)(i) $3,700,000
minus, (ii) the aggregate amount of debt and other payables of the Company, which is expected not to exceed $700,000, divided by
(B) the VWAP of the Company’s common stock for the twenty trading days prior to the closing date.
In addition, the Company will agree to pay
all obligations of Rotor Riot, expected to be approximately $700,000. This will include the issuance to the principal Member of
Rotor Riot of a promissory note in the principal amount of $175,000, with $3,500 to be paid monthly, and the principal and any
accrued and unpaid interest being due on the earlier of (A) six months from the date of issuance and (B) the closing of an equity
offering by the Company of no less than $3,000,000. Interest shall accrue on the promissory note at the rate of 4.75% per annum.
The consummation of the Merger is subject to
the satisfaction by the parties of all of the closing conditions set forth in the Merger Agreement. The Merger Agreement contains
customary representations and warranties and pre- and post-closing covenants of each party and customary closing conditions. Breaches
of the representations and warranties will be subject to indemnification provisions; provided, however, that the maximum
amount that the Company is entitled to recover from Rotor Riot and the Members is 7.5% of the purchase price.
The Merger is intended to be treated as a tax-free
reorganization under Section 368(a) of the Internal Revenue Code of 1986, as amended.
As of the date of the Merger Agreement, there
were no material relationships between the Company or any of its affiliates and Rotor Riot, other than in respect of the Merger
Agreement.
The foregoing summary of the Merger Agreement
does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, a copy of which will be
filed as an exhibit to the Form 8-K the Company plans to file to report the closing of the Merger.
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Item 7.01
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Regulation FD Disclosure.
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On January 3, 2020, the Company issued a press
release announcing the entry into the Merger Agreement and proposed acquisition of Rotor Riot. The text of the release is furnished
as Exhibit 99.1 and incorporated herein by reference.
The information in this Item 7.01 of this Form
8-K, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for the purposes of
Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall it be deemed incorporated
by reference in any of the Company’s filings under the Securities Act of 1933, as amended,
or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference
to this Form 8-K in such filing.
Cautionary Statements
This filing includes “forward-looking
statements.” All statements other than statements of historical facts included or incorporated herein may constitute forward-looking
statements. Actual results could vary significantly from those expressed or implied in such statements and are subject to a number
of risks and uncertainties. Although the Company believes that the expectations reflected in the forward-looking statements are
reasonable, the Company can give no assurance that such expectations will prove to be correct. The forward-looking statements involve
risks and uncertainties that affect the Company’s operations, financial performance, and other factors as discussed in the
Company’s filings with the Securities and Exchange Commission (“SEC”). Among the factors that could cause results
to differ materially are those risks discussed in the periodic reports the Company files with the SEC. You are urged to carefully
review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading
“Risk Factors.” The Company does not undertake any duty to update any forward-looking statement except as required
by law.
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Item 9.01
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Financial Statements and Exhibits.
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(d) Exhibits
Exhibit No.
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Description
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99.1
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Press Release, dated January 3, 2020.
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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 thereunto duly authorized.
Date: January 3, 2020
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RED CAT HOLDINGS, INC.
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By:
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/s/ Jeffrey Thompson
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Jeffrey Thompson
President and Chief Executive Officer
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