Item
1.01
|
Entry
into a Material Definitive Agreement.
|
On
January 8, 2021, Sigma Labs, Inc. (“we,” “our,” “us,” or the “Company”) entered
into an underwriting agreement (the “Underwriting Agreement”) with H.C. Wainwright & Co. (the “Underwriter”),
which provided for the issuance and sale by the Company in an underwritten public offering (the “Offering”)
and the purchase by the Underwriter of 1,488,507 shares of the Company’s common stock, $0.001 par value per share. The
offering closed on January 12, 2021.
Subject
to the terms and conditions contained in the Underwriting Agreement, the shares were sold to the Underwriter at a public
offering price of $3.00 per share, less underwriting discounts and commissions. The Company also granted the Underwriters a 30-day
option to purchase up to 223,276 additional shares of the Company’s common stock on the same terms and conditions. The Underwriter
fully exercised such option to purchase up to 223,276 additional shares of the Company’s common stock, for an aggregate
of 1,711,783 shares of Common Stock. Pursuant to the Underwriting Agreement, we have also issued to the Underwriter
or its designee warrants to purchase a number of shares equal to 8% of the aggregate number of shares of common stock sold in
the Offering, including shares issued upon exercise of the option to purchase additional shares (the “Underwriter Warrants”).
The Underwriter Warrants have a term of five years from the commencement of sales in the Offering and an exercise price of
$3.75 per share. The net offering proceeds to the Company from the Offering are approximately $3,919,552 (or approximately
$4,532,444 taking into account the Underwriter’s exercise of its option to purchase additional shares in full), after deducting
underwriting discounts and commissions and other estimated offering expenses. We intend to use the net proceeds from the Offering
for our operations, including the development and marketing of our products and services, and working capital and general corporate
purposes.
The Offering was made pursuant to the Company’s registration statement on Form S-3 (File No. 333-225377), which was declared
effective by the Securities and Exchange Commission (the “SEC”) on June 14, 2018, under the Securities Act of
1933, as amended (the “Securities Act”), and the prospectus dated June 14, 2018, included in such registration
statement, as supplemented by the preliminary prospectus supplement, dated January 7, 2021 and a final prospectus supplement
dated January 8, 2021, as supplemented by supplement no. 1 dated January 11, 2021.
The
Underwriting Agreement contains customary representations, warranties and covenants of the Company, customary conditions to closing,
indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act and termination
and other provisions customary for transactions of this nature. The Company and all of the Company’s officers and directors
have also agreed not to sell or transfer any securities of the Company held by them for a period of 90 days from the closing date
of the Offering, subject to limited exceptions.
On
January 8, 2021, the Company obtained a waiver (“Waiver”) from certain investors (“Investors”) with respect
to certain anti-dilution adjustment provisions of a January 2020 warrant and an April 2020 warrant issued to the Investors. As
consideration for the Waiver, the Company issued an additional warrant (“Warrant”) to the Investors to purchase
an aggregate of 100,000 shares of common stock, each exercisable after six months for a five-year period with an exercise
price equal to 115% of the closing price of the Company’s stock on the date of the waiver.
The
foregoing summary of the Underwriting Agreement, the Underwriter Warrants, the Warrant and the Waivers are qualified in its entirety
by reference to the full text of the Underwriting Agreement, the Underwriter Warrants, the Warrant and the Waivers, copies
of which are filed herewith as Exhibits 1.1, 4.1, 4.2 and 10.1, respectively, to this Current Report on Form 8-K and incorporated
herein by reference. A copy of the opinion of TroyGould PC relating to the legality of the issuance and sale of the shares of
common stock in the Offering is filed as Exhibit 5.1 hereto and is incorporated herein and into the Registration Statement by
reference.