Item 1.01
Entry into a Material Definitive Agreement.
On August 17, 2017, Netlist, Inc. (the “
Company
”) entered into a purchase agreement (the “
Purchase Agreement
”) with Craig-Hallum Capital Group LLC and Roth Capital Partners, LLC, as representatives of the several underwriters named therein (collectively, the “
Underwriters
”), in connection with a registered firm-commitment underwritten public offering (the “
Offering
”) of 8,500,000 shares of the Company’s common stock, par value $0.001 per share (“
Common Stock
”), at a price to the Underwriters of $0.555 per share and at a price to the public of $0.60 per share. Pursuant to the terms of the Purchase Agreement, the Company also granted the Underwriters a 30-day option to purchase up to an additional 1,275,000 shares of Common Stock to cover over-allotments, if any. The Company expects to close the Offering on August 22, 2017, subject to the satisfaction or waiver of customary closing conditions.
The Company estimates the net proceeds from the Offering, after deducting the underwriting discount and commissions and estimated offering expenses payable by the Company, will be approximately $4.5 million (assuming no exercise of the underwriter’s option to purchase additional shares of Common Stock). The Company intends to use the net proceeds for general corporate purposes, including working capital and other general and administrative purposes. The Company may also use the net proceeds from the proposed offering for acquisitions of complementary products, technologies or businesses, but the Company does not have any current plans, agreements or commitments for any specific acquisitions at this time.
The shares of Common Stock to be sold in the Offering have been registered pursuant to the Company’s registration statement on Form S-3 (File No. 333-199446) (the “
Registration Statement
”), which was declared effective by the Securities and Exchange Commission (the “
SEC
”) on September 2, 2016, as supplemented by a preliminary prospectus supplement dated August 16, 2017 and a final prospectus supplement dated August 17, 2017, each filed or to be filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “
Securities Act
”).
The Purchase Agreement contains customary representations, warranties and agreements by the Company, conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the Purchase Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties. These representations, warranties and covenants are not intended to provide factual information about the Company.
Pursuant to the terms of the Purchase Agreement and certain lock-up agreements in substantially the form included as an exhibit to the Purchase Agreement, the Company and all of its directors and executive officers have agreed to a 90-day “lock-up” period with respect to sales or other dispositions of specified securities of the Company, subject to certain exceptions.
The foregoing is only a brief description of the material terms of the Purchase Agreement, does not purport to be a complete description of the rights and obligations of the parties thereunder, and is qualified in its entirety by reference to the copy of the Purchase Agreement that is filed as Exhibit 1.1 to this Current Report on Form 8-K and incorporated herein by reference. The Purchase Agreement is also filed with reference to, and is hereby incorporated by reference in, the Registration Statement.