Item 1.01
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Entry
into a Material Definitive Agreement
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On
April 20, 2018, Inpixon (the “Company”) entered into a Placement Agency Agreement (the “Agreement”) with
Roth Capital Partners, LLC (the “Placement Agent”) pursuant to which the Company agreed to sell and the Placement Agreement
agreed to use its “best efforts” to assist with selling, in a public offering (the “Offering”), subject
to the terms and conditions expressed therein, approximately $10.4 million in securities of the Company, consisting of units (the
“Units”), at a price to the public of $1,000 per Unit, each consisting of (i) one share of our newly designated Series
4 convertible preferred stock, par value $0.001 per share (the “Series 4 Preferred”), containing the relative rights,
preferences, limitations and designations set forth in the certificate of designation (the “Certificate of Designation”),
with a stated value of $1,000 and initially convertible into approximately 2,174 shares of the Company’s common stock, par
value $0.001 per share (the “Common Stock”), at a conversion price of $0.46 per share (subject to adjustment) and (ii)
one warrant to purchase such number of shares of Common Stock as each share of Series 4 Preferred is convertible into (each a “Warrant”,
and collectively, the “Warrants”).
The
Units, the shares of Series 4 Preferred, the Warrants and the Common Stock underlying such securities, as applicable, are immediately
separable and will be issued separately in this Offering. Pursuant to the terms of a Securities Purchase Agreement by and between
the Company and certain institutional purchasers of the Units (the “Institutional Purchasers") in the Offering (the
“SPA”), an aggregate of 10,115 Units will be sold to the Institutional Purchasers and certain other purchasers of Units
that are not a party to the SPA for an aggregate of 10,115 shares of Series 4 Preferred convertible into an aggregate of 21,989,160
(subject to rounding) shares of Common Stock and Warrants to purchase an equivalent number of shares of Common Stock.
The
Company expects to receive approximately $10.1 million in gross proceeds from the Offering, before deducting placement agent fees
and Offering expenses payable by the Company. After deducting placement agent fees and expenses, we expect the net proceeds from
the Offering to be approximately $9.2 million. The Company intends to use the net proceeds from the Offering for working capital,
general corporate purposes (including research and development, sales and marketing and the satisfaction of outstanding amounts
payable to our vendors in connection with trade payables). Additionally, the Company may use a portion of the net proceeds of
this Offering to finance acquisitions of, or investments in, competitive and complementary businesses, products or services as
a part of our growth strategy. However, the Company does not have any current commitments with respect to any such acquisitions
or investments.
The
Series 4 Preferred contain an anti-dilution protection feature, to adjust the conversion price if shares of common stock are
sold or issued for a consideration per share less than the conversion price then in effect (subject to certain exemptions),
provided, that the conversion price will not be less than $0.124. In addition, on the 60th day following the original
issuance date of the Series 4 Preferred, the conversion price will be reduced, and only reduced, to the lesser of (x) the
then conversion price, as may be adjusted, and (y) 80% of the VWAP (as defined in the Certificate of Designation) on the
trading day immediately prior to the 60th day, provided that the conversion price will not be less than $0.124.
Subject
to certain ownership limitations, the Series 4 Preferred is convertible at any time at the option of the holder. The Series 4
Preferred will be non-voting (except to the extent required by law) and convertible into the number of shares of Common Stock
determined by dividing the aggregate stated value of $1,000 per share by the conversion price then in effect.
The
Warrants will be immediately exercisable at an exercise price of $0.67 per share (subject to adjustment). If, at any time while
the Warrants are outstanding, the Company or any significant subsidiary thereof, as applicable, shall sell or grant any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any
option to purchase or other disposition) any Common Stock or Common Stock equivalents, at an effective price per share that is
less than the exercise price then in effect (such lower price, the “Base Share Price”), the applicable exercise price
shall be reduced and only reduced to equal the Base Share Price, provided that the Base Share Price shall not be less than $0.124
(subject to adjustment for reverse and forward stock splits, recapitalizations and similar transactions following the date of
the SPA).
The
Company expects the Offering to close on or about April 24, 2018, subject to the satisfaction of customary closing conditions
including the filing of a Certificate of Designation with the Secretary of State of the State of Nevada with respect to the Series
4 Preferred.
The
Company will conduct the Offering of the Units pursuant to a Registration Statement on Form S-3 (File No. 333-204159), which was
declared effective by the Securities and Exchange Commission on May 28, 2015 (the “Registration Statement”). A preliminary
prospectus supplement and the accompanying prospectus relating to the Offering was filed with the SEC on April 19, 2018, and a
final prospectus supplement and the accompanying prospectus relating the Offering will be filed with the SEC no later than April
24, 2018.
Each
of the Company’s officers, directors and more than 5% beneficial owners of common stock have agreed that for a period of
180 days after the date of the Registration Statement, they will be subject to a lockup prohibiting certain sales, transfers or
hedging transactions in the Company’s securities held by them.
The
Placement Agent will be entitled to a cash fee of up to 8.0% of the aggregate gross proceeds and reimbursement of certain out-of-pocket
expenses up to an aggregate of $100,000.
The
foregoing description of the Agreement, the Series 4 Preferred, the SPA, the Warrants and the Lock-Up Agreement is not complete
and is qualified in its entirety by reference to the full text of the Agreement, the Certificate of Designation and the forms
of SPA, Warrant and Lock-Up Agreement, which are attached as Exhibits 3.1, 4.1, 10.1, 10.2 and 10.3 respectively, to this Current
Report on Form 8-K and are incorporated herein by reference.
The
legal opinion and consent of Mitchell Silberberg & Knupp LLP relating to the securities is filed as Exhibit 5.1 to this Current
Report on Form 8-K and is incorporated herein by reference.