Current Report Filing (8-k)

Date : 07/02/2019 @ 8:45PM
Source : Edgar (US Regulatory)
Stock : DPW Holdings Inc (DPW)
Quote : 0.8368  0.0132 (1.60%) @ 1:00AM
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Current Report Filing (8-k)







Washington, D.C. 20549








Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934




Date of Report (Date of earliest event reported):  July 2, 2019



(Exact name of registrant as specified in its charter)


Delaware   001-12711   94-1721931
(State or other jurisdiction of incorporation or organization)   (Commission File Number)   (I.R.S. Employer Identification No.)


201 Shipyard Way, Newport Beach, CA 92663

(Address of principal executive offices) (Zip Code)


(949) 444-5464

(Registrant's telephone number, including area code)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


o        Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o        Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12(b) of the Act:


Title of each class  



  Name of each exchange on which registered
Common Stock, $0.001 par value   DPW   NYSE American


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).


 Emerging growth company o


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o






Item 1.01 Entry into a Material Definitive Agreement.


On July 2, 2019 (the “ Closing Date ”), DPW Holdings, Inc., a Delaware corporation (the “ Company ”) entered into an Exchange Agreement (the “ Exchange Agreement ”) with a certain institutional investor (the “ Investor ”) pursuant to which, in exchange for that certain Term Promissory Note issued by the Company to the Investor on September 21, 2018 (the “ Original Note ”), the Company sold to the Investor a new convertible promissory note in the principal amount of $783,031.14 (subject to adjustments pursuant to that certain side letter of even date therewith) with an interest rate of 12% per annum (the “ New Note ”). Subject to the approval by the NYSE American, the New Note shall be convertible into shares of common stock, par value $0.001 per share (the “ Conversion Shares ”), commencing on July 15, 2019, at conversion price equal to the greater of (A) $0.22 or (B) 80% of the lowest daily VWAP in the three Trading Days prior to the date of conversion (the “ Conversion Price ”).


Pursuant to a registration rights agreement by and between the Company and the Investor (the “ RRA ”), the Company shall file with the Securities and Exchange Commission (the “ SEC ”) the initial registration statement on Form S-3 (the “ Registration Statement ”) under the Securities Act of 1933, as amended (the “ Securities Act ”), relating to the resale by the Investor of all (or such other number as the SEC will permit) of the Conversion Shares no later than July 10, 2019.


Description of Convertible Promissory Note


The New Note has a principal face amount of $783,031.14 with an interest rate of 12% per annum and a maturity date of December 31, 2019. Commencing on July 15, 2019, the New Note shall be convertible into such number of shares of Common Stock issuable determined by dividing the principal amount of the New Note, subject to adjustments as provided in the Exchange Agreement and that certain side letter agreement made of even date thereof, by the Conversion Price. The New Note contains standard and customary events of default including, but not limited to, failure to make payments when due under the New Note, failure to comply with certain covenants contained in the New Note, or bankruptcy or insolvency of the Company.


 After the occurrence of any Event of Default (as defined in the New Note) that results in the eventual acceleration of the New Note, the interest rate on the New Note shall accrue at an additional interest rate equal to the lesser of 18.0% per annum or the maximum rate permitted under applicable law, shall be compounded daily, and shall be due and payable on the first Trading Day of each calendar month during the continuance of such Event of Default.


The Conversion Shares were offered and sold to the Investor in reliance upon exemption from the registration requirements under Section 3(a)(9) under the Securities Act of 1933, as amended.


The foregoing is only brief description of the material terms of the Exchange Agreement, the New Note and the Registration Rights Agreement, the forms of which are attached hereto as exhibits to this Current Report on Form 8-K and are incorporated herein by reference. The foregoing does not purport to be a complete description of the rights and obligations of the parties thereunder and such descriptions are qualified in their entirety by reference to the respective exhibit.


Item 3.02   Unregistered Sales of Equity Securities


The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference to this Item 3.02.


Item 9.01 Exhibits and Financial Statements.


(d)           Exhibits:




4.1   Form of Convertible Promissory Note
10.1   Form of Exchange Agreement
10.2   Form of Registration Rights Agreement








Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



 Dated: July 2, 2019 /s/ Milton C. Ault, III  

Milton C. Ault, III

Chief Executive Officer







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