PWFL PowerFleet Inc

Item 1.01. Entry into a Material Definitive Agreement.

On June 9, 2021, PowerFleet, Inc. (the “Company”) entered into a preferred stock redemption right agreement (the “Redemption Right Agreement”) with ABRY Senior Equity V, L.P., ABRY Senior Equity Co-Investment Fund V, L.P. and ABRY Investment Partnership, L.P. (collectively, the “Investors”), pursuant to which the Company has the right to redeem 10,000 shares of its Series A Convertible Preferred Stock (“Series A Preferred Stock”) at a price of $1,450 per share plus all accrued and unpaid dividends, to be paid in cash. The Series A Preferred Stock was originally issued to the Investors on October 3, 2019 in connection with the completion of the Company’s acquisition of Pointer Telocation Ltd.

The Company’s exercise of the redemption right under the Redemption Right Agreement is subject to, among other things, stockholder approval of an amendment to the Company’s Amended and Restated Certificate of Incorporation to modify certain terms of the Series A Preferred Stock (the “Series A Preferred Amendment”), as described in detail in the Company’s definitive proxy statement on Schedule 14A filed with the Securities and Exchange Commission on June 11, 2021, and the decision of the Company’s board of directors to effect the Series A Preferred Amendment and the redemption. Closing of the redemption is also conditioned upon, among other things, the Company having sufficient “surplus” (as defined and calculated in the General Corporation Law of the State of Delaware) and funds lawfully available to pay the aggregate redemption price in cash and the Company, after giving effect to the redemption, having (i) net assets (as such term is defined and determined in accordance with Delaware law) greater than zero and greater than the amount which would be required as of the closing date of the redemption to pay the maximum amount which would be owed to stockholders with preferential rights in a liquidation of the Company and (ii) the requisite financial wherewithal to conduct its business, pay any and all liabilities as due and all then-incurred debts as they mature.

The Redemption Right Agreement automatically terminates at 5:30 p.m. on October 1, 2021 if the redemption has not closed.

The foregoing description of the Redemption Right Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Redemption Right Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.