Item
1.01 Entry into a Material Definitive Agreement.
Background
As
previously disclosed by Ascent Solar Technologies, Inc. (the “Company”) in its Current Report on Form 8-K dated December
20, 2022, on December 19, 2022, the Company entered into a Securities Purchase Contract (the “Securities Purchase Contract”)
with two institutional investors (each, an “Investor” and collectively, the “Investors”) for the issuance to
the Investors of $12,500,000 in aggregate principal amount of Senior Secured Original Issue 10% Discount Convertible Advance Notes pursuant
to a direct registered offering (the “Registered Advance Notes”) and $2,500,000 in aggregate principal amount of Senior Secured
Original Issue 10% Discount Convertible Advance Notes in a concurrent private placement (the “Private Placement Advance Notes”
and, together with the Registered Advance Notes, the “Advance Notes”).
As
previously disclosed in its Current Reports on Form 8-K dated March 29, 2023 and April 13, 2023 the Company and each of the Investors
have entered into a Waiver and Amendment Agreement (the “First Amendment”) relating to the Securities Purchase Contract and
the Advance Notes. The First Amendment waived any event of default arising under Section 2.1 of the Advance Notes relating to the Company’s
receipt of notice from the Listing Qualifications Department of The Nasdaq Stock Market (“Nasdaq”) indicating that the Company
is not in compliance with the $1.00 Minimum Bid Price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the “$1.00 Minimum
Bid Price Requirement”) for continued listing on The Nasdaq Capital Market (the “Nasdaq Bid Price Default”).
Pursuant
to the First Amendment, the Company and each of the Investors agreed to waive the Nasdaq Bid Price Default and further agreed to the
amend the Advance Notes to provide that (i) the new “Floor Price” for all purposes of the Advance Notes is $0.20 per share
of the Company’s common stock, (ii) until the Company regains compliance with the $1.00 Minimum Bid Price Requirement, “Conversion
Price” under the Advance Notes will mean the “Alternative Conversion Price” (as defined in the Advance Notes) and (iii)
the Company agreed to make certain prepayments of the Advance Notes held by the Investors. The Company's failure to comply with the terms
of the First Amendment would constitute an Event of Default under the Advance Notes.
Second
Amendment
On
May 25, 2023, the Company and each of the Investors entered into a Waiver and Amendment Agreement (the “Second Amendment”)
relating to the Securities Purchase Contract and the Advance Notes.
The
Second Amendment waives any default arising under Section 2.1 of the Advance Notes relating to the Company’s receipt of notice
from the Listing Qualifications Department of Nasdaq indicating that the Company is not in compliance with Nasdaq Listing Rule 5550(b)(1),
which requires companies listed on Nasdaq to maintain a minimum of $2,500,000 in stockholders’ equity (the “Stockholders’
Equity Requirement”) for continued listing on Nasdaq (the “Nasdaq Equity Default”).
Pursuant
to the Second Amendment, the Company and each of the Investors agreed to amend the Advance Notes to provide that the new “Floor
Price” for all purposes of the Advance Notes is $0.13 per share of the Company’s common stock.
The
Second Amendment also waives any default arising under the First Amendment for failure of the Company to make certain agreed prepayments
of the Advance Notes held by the Investors as set forth in the First Amendment.
Pursuant
to the Second Amendment, the Company and each of the Investors agreed to the amend the Advance Notes to provide that if the Company receives
a Notice of Conversion at a time that the Conversion Price (or, as applicable, the Alternative Conversion Price) then in effect Price,
without regard to the Floor Price (the “Applicable Conversion Price”), is less than the Floor Price then in effect, the Company
shall issue a number of shares equal to the Conversion Amount divided by such Floor Price and, at its election (x) pay the economic difference
between the Applicable Conversion Price and such Floor Price (the “Outstanding Conversion Amount”) in cash at such time or
(y) pay the Outstanding Conversion Amount following the consummation of a reverse stock split by the Company (1) in cash or (2) by issuing
to the Holder a number of shares of Common Stock with an aggregate value equal to the Outstanding Conversion Amount, with the value per
share of Common Stock for purposes of such calculation equal to (i) if such shares are issued on or prior to August 23, 2023, the daily
VWAP of the Common Stock on the Trading Day following the date of the consummation of such reverse stock split or (ii) if such shares
are issued after August 23, 2023, 90% of the daily VWAP of the Common Stock on the Trading Day following the date of the consummation
of such reverse stock split.
Pursuant
to the Second Amendment, the Company and each of the Investors agreed to amend the schedule for the prepayments set forth in the First
Amendment. After giving effect to the Second Amendment, the Company will make certain prepayments of the Advance Notes held by the Investors
on the following dates and in the following aggregate cash amounts, at a price equal to 100% of the principal amount of the Advance Notes
to be repaid plus accrued and unpaid interest thereon (if any).
| Prepayment
Date |
Schedule
A Holders
Aggregate
Prepayment Amount |
Schedule
B Holders
Aggregate Prepayment Amount |
| April
3, 2023* |
$333,333.33 |
— |
| April
13, 2023** |
— |
$333,333.33 |
| August
16, 2023 |
$333,333.33 |
$333,333.33 |
| September
17, 2023 |
$333,333.34 |
$333,333.34 |
| Total |
$1,000,000.00 |
$1,000,000.00 |
*
Paid by the Company to the Schedule A Holders on April 3, 2023
**
Paid by the Company to the Schedule B Holders on April 13, 2023
Pursuant
to the Second Amendment, (i) the Company has agreed to use reasonable best efforts to complete a reverse stock split of its Common Stock
within the next 60 days, (ii) the Company shall use its commercially reasonable efforts to, prior to August 16, 2023, conduct an equity
or debt financing for the purpose of raising additional capital for the Company to be used for general corporate purposes, and (iii)
from and after August 16, 2023, the Company shall maintain at least $2 million in cash.
The
Company’s failure to comply with the terms of the Second Amendment would constitute an “Event of Default” under the
Advance Notes.
The
foregoing description of the Second Amendment does not purport to be complete and is qualified in its entirety by the full text of the
Second Amendment, which is filed as Exhibit 10.1 hereto and incorporated herein by reference.