Item
1.01 Entry into a Material Definitive Agreement.
Execution
of Ancillary Agreements
As previously
disclosed, on August 7, 2018, Inpixon (“Inpixon”) entered into a Separation and Distribution Agreement with Sysorex,
Inc. pursuant to which the IT solutions and professional services business would be transferred to Sysorex and the indoor positioning
analytics business would be transferred to Inpixon (the “Separation”) and Inpixon would distribution 100% of the outstanding
common stock, par value $0.00001 per share, of Sysorex (the “Distribution”) to Inpixon’s common stockholders
of record, together with holders of Inpixon’s Series 4 Convertible Preferred Stock and certain holders of Inpixon warrants,
as of the close of business on August 21, 2018 (the “Record Date”). Pursuant to Amendment No. 1 to the Separation
and Distribution Agreement, which is described below, the Distribution was effective at 4:01 p.m., Eastern Time, on August 31,
2018 (the “Effective Date”).
On the Effective
Date, Inpixon and Sysorex entered into a Transition Services Agreement, a Tax Matters Agreement, an Employee Matters Agreement
and an Assignment and Assumption Agreement (the “Ancillary Agreements”). The Ancillary Agreements govern the relationship
of the parties following the Distribution.
A summary of the
material terms of the Transition Services Agreement, the Tax Matters Agreement and the Employee Matters Agreement can be found
in the section titled “Relationship with Inpixon Following Separation and Distribution” in Sysorex’s Information
Statement, dated August 17, 2018 (the “Information Statement”), which was included as Exhibit 99.1 to Sysorex’s
Current Report on Form 8-K filed with the Securities and Exchange Commission on August 17, 2018. This summary is incorporated by
reference into this Item 1.01 as if restated in full. This summary is qualified in its entirety by reference to the Separation
and Distribution Agreement, Transition Services Agreement, Tax Matters Agreement and Employee Matters Agreement which are included
with this report as Exhibits 2.1, 10.1, 10.2 and 10.3, respectively, each of which is incorporated herein by reference. The Assignment
and Assumption Agreement is included as Exhibit 10.4 to this Current Report on Form 8-K and incorporated by reference into this
Item 1.01. Through the Assignment and Assumption Agreement, Inpixon and Sysorex assigned to each other, as applicable, the Sysorex
Assets and the Inpixon Assets and assumed, as applicable, the Sysorex Liabilities and the Inpixon Liabilities.
In addition, prior
to and in connection with the Separation, Inpixon contributed $2 million in existing cash to Sysorex for working capital needs
and other general corporate purposes including the satisfaction of certain outstanding payables.
Amendment No. 1 to Separation and Distribution Agreement
On the Effective Date, Inpixon and Sysorex
executed Amendment No. 1 to Separation and Distribution Agreement changing the definition of “Effective Time” from
12:01 a.m., Eastern standard time, on the Distribution Date (as defined in the Separation and Distribution Agreement) to 4:01 p.m.,
Eastern standard time, on the Distribution Date.
The description
of Amendment No. 1 to Separation and Distribution Agreement set forth under this Item 1.01 is qualified in its entirety by reference
to the complete terms of that agreement, which is included as Exhibit 10.5 to this Current Report on Form 8-K and incorporated
by reference into this Item 1.01.
Amendment
to Payplant Client Agreement
On
the Effective Date, Inpixon, together with Sysorex and its wholly-owned subsidiary, Sysorex Government Services, Inc. (“SGS”),
and Payplant LLC, executed Amendment 1 to Payplant Client Agreement (the “Amendment”). Pursuant to the Amendment,
Sysorex and SGS are no longer parties to the Payplant Client Agreement, originally entered into on August 14, 2017, and have been
released from any and all obligations and liabilities arising under the Payplant Client Agreement, whether such obligations and
liabilities were in existence prior to or on the date of the Amendment or arise after the date of the Amendment.
This summary is
qualified in its entirety by reference to Amendment 1 to Payplant Client Agreement which is included with this report as Exhibit
10.6 and is incorporated herein by reference.
Standstill Agreement
On August 30, 2018,
Inpixon entered into a Standstill Agreement with Chicago Venture Partners, L.P. (the “Lender”). Pursuant to the Standstill
Agreement, the Lender has agreed that its right to redeem all or any portion of the Convertible Promissory Note dated November
17, 2017 in the principal amount of $1,745,000.00 (the “Note”) will not commence until the date that is the earlier
of (i) 12 months after the purchase price date, and (b) five trading days following receipt of approval from Inpixon’s stockholders,
as may be required in accordance with applicable Nasdaq Listing Rules, to amend the terms of the Note to modify the Conversion
Price and the Minimum Redemption Price, as those terms are defined in the Note, on terms that are acceptable to the Lender. The
Standstill Agreement also extends the maturity date of the Note to December 31, 2018. Inpixon paid the Lender $75,000 as consideration
for the Lender’s consent to enter into the Standstill Agreement.
This summary is
qualified in its entirety by reference to the Standstill Agreement which is included with this report as Exhibit 10.7 and is incorporated
herein by reference.