Item 2.03
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Creation of a Direct Financial Obligation or an Obligation under
an Off-Balance Sheet
Arrangement of a Registrant.
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On June 10,
2019, GigCapital, Inc., a Delaware corporation (the Company) issued four
non-convertible
unsecured promissory notes (each, an Extension Note and collectively the Extension
Notes) in the aggregate principal amount of $240,000.00, as follows: (i) $174,643.99 issued to GigAcquisitions, LLC, a Delaware limited liability company (our Sponsor), (ii) $43,578.25 to Cowen Investments II LLC, a
Delaware limited liability company (Cowen Investments), (iii) $19,599.94 to Irwin Silverberg, an individual and affiliate of Cowen Investments (Silverberg) and (iv) $2,177.82 to Jeffrey Bernstein, an individual and
affiliate of Cowen Investments (Bernstein, and collectively with Sponsor, Cowen Investments, and Silverberg, our Founders). The Founders deposited such funds into the Companys trust account (the Trust
Account), as described in the prospectus filed by the Company in connection with the Companys initial public offering. The Extension Notes were issued in connection with the approval of the Charter Amendment and Extension and constitute
the first monthly Contribution as previously disclosed in the Companys Current Report on Form
8-K
as filed with the Securities and Exchange commission on May 16, 2019.
On June 10, 2019, the Company also issued an additional four convertible unsecured promissory notes (each, a Working Capital
Note and collectively the Working Capital Notes) in the aggregate principal amount of $91,666.67, as follows: (i) $66,704.30 to our Sponsor, (ii) $16,644.47 issued to Cowen Investments, (iii) $7,486.09 to Silverberg, and (iv)
$831.81 to Bernstein. The Working Capital Notes were issued to provide the Company with additional working capital during the Extension, and will not be deposited into the Trust Account. The Company issued the Working Capital Notes in consideration
for loans from the payees to fund the Companys working capital requirements. The convertible notes are convertible at the payees election upon the consummation of the Business Combination. Upon such election, the convertible notes will
convert, at a price of $10.00 per unit, into units identical to the private placement units issued in connection with the Companys initial public offering, except that the private placement warrants which comprise a part of the private
placement units issued to Cowen Investments, Silverberg, and Bernstein, so long as they are held by Cowen Investments, Silverberg, and Bernstein, respectively, or any of their related persons under FINRA rules, will expire five years from the
effective date of the Companys registration statement, or earlier upon the Companys liquidation.
The Extension Notes and
Working Capital Notes bear no interest and are repayable in full upon the consummation of the Companys previously announced business combination disclosed in its Current Report
on Form 8-K as
filed with the Securities and Exchange Commission on February 26, 2019.
The
table below sets forth the breakdown of the Extension Notes and Working Capital Notes issued to each of the payees:
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Extension Notes
(Non-Convertible
Notes)
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Working Capital
Notes
(Convertible Notes)
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Total
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GigAcquisitions LLC
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$
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174,643.99
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$
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66,704.30
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$
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241,348.29
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Cowen Investments II LLC
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$
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43,578.25
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$
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16,644.47
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$
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60,222.72
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Irwin Silverberg
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$
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19,599.94
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$
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7,486.09
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$
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27,086.03
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Jeffrey Bernstein
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$
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2,177.82
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$
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831.81
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$
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3,009.63
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Total
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$
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240,000.00
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$
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91,666.67
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$
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331,666.67
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Copies of the forms of Extension Note and Working Capital Note note are filed as Exhibits 10.1 and 10.2.
Item 3.02
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Unregistered Sales of Equity Securities
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The information set forth in Item 2.03 of this Current Report on Form
8-K
is incorporated by reference into this Item
3.02. An aggregate of 9,166 private placement units of the Company would be issued if the entire principal balance of the convertible notes is converted. The warrants constituting a part of the units would be exercisable, subject to the terms and
conditions of the warrant and during the exercise period as provided in the warrant agreement governing the warrants. The rights constituting a part of the units are exchangeable, subject to the terms and conditions of the rights, for common shares
as provided in the right agreement governing the rights. The Company has relied upon Section 4(a)(2) of the Securities Act of 1933, as amended, in connection with the issuance and sale of the convertible promissory notes, as they were issued to
sophisticated investors without a view to distribution, and were not issued through any general solicitation or advertisement.