Item 1.01. Entry into a Material Definitive
Agreement.
On October 17, 2022, Sysorex, Inc. (the “Company”)
entered into a Placement Agency Agreement (the “Placement Agency Agreement”), dated October 17, 2022, by and between the Company
and Joseph Gunnar & Co., LLC (the “Placement Agent”). Pursuant to the terms of the Placement Agency Agreement, the Company
engaged the Placement Agent to act as the Company’s exclusive placement agent with respect to effectuating a private placement (the
“Offering”) to accredited investors, pursuant to which the Company offered up to $500,000 of its common stock and a warrant
to purchase common stock (collectively, the “Securities”). Placement of the Securities was made on a “commercially reasonable
efforts” basis.
Pursuant to the terms of the Placement Agency
Agreement, the Company agreed to pay to the Placement Agent a cash fee (the “Cash Fee”) equal to 12.5% of the aggregate gross
proceeds of the Offering. In addition, the Company agreed to reimburse the Placement Agent for all reasonable, documented marketing, travel
and other out-of-pocket expenses incurred in connection with the Offering and to pay the Placement Agent’s counsel fees in the amount
of $40,000 (“Legal Fees”); provided, however, that any fees or expenses incurred in connection with the Offering for which
the Company will be responsible for reimbursement, including Legal Fees, will not exceed $50,000 collectively. The Company also agreed
to pay to the Placement Agent the Cash Fee to the extent any party first introduced to the Company by the Placement Agent at any time
prior to the date that is 12 months after the applicable termination date of the Offering or the final closing, whichever is applicable,
makes any investment into the Company through the acquisition of Company securities from the Company.
For a period of 12 months following October 18,
2022 and subject to a closing of the Offering having been effected, in the event that the Company desires to raise additional capital
in the form of debt, equity or otherwise (a “Prospective Financing”), the Placement Agent will have the right of first refusal
to act as Placement Agent with respect to any such Prospective Financing.
On October 18, 2022, the Company entered into
a Securities Purchase Agreement (the “SPA”), dated as of October 18, 2022, by and among the Company and each of the each of
the investors signatories thereto (each an “Investor” and collectively, the “Investors”). Pursuant to the terms
of the SPA, the Company agreed to sell to each Investor a number of Units of securities of the Company (each, a “Unit”), at
a purchase price of $0.001 per Unit, with each Unit being comprised of: (i) one share of common stock (each, a “Purchased Share”
and collectively, the “Purchased Shares”); (ii) a warrant to acquire one share of common stock at an exercise price of $0.001
per share, which exercise price will not be subject to adjustment as a result of any forward or reverse split of the common stock (each,
a “Warrant 1”); and (iii) a warrant to acquire one share of common stock at an exercise price of $0.001 per share, which exercise
price will not be subject to adjustment as a result of any forward or reverse split of the common stock (each, a “Warrant 2”).
The Investors, collectively, subscribed for a total of 500,000,000 Units, consisting of 500,000,000 shares of common stock, Warrant 1s
to acquire 500,000,000 shares of common stock, and Warrant 2s to acquire 500,000,000 shares of common stock, for total consideration payable
to the Company of $500,000.
The Company will use the net proceeds from the
sale of the Units for working capital purposes and will not use such proceeds (a) for the redemption of any common stock or preferred
stock or convertible debt which is convertible into common stock (provided that, for the avoidance of doubt, the Company may use such
net proceeds for the repayment of any convertible debt in accordance with the terms thereof); (b) for the settlement of any outstanding
litigation; (c) in violation of the Foreign Corrupt Practices Act or Office of Foreign Assets Control regulations; or (d) to lend, give
credit or make advances to any officers, directors, employees or affiliates (provided that, for the avoidance of doubt, the Company may
use such net proceeds for the payment of costs, fees, salaries and benefits in the ordinary course of business with respect to such officers,
directors, employees or affiliates).
The SPA contains customary representations, warranties
and closing conditions.
The transactions contemplated by the SPA closed
on October 18, 2022. Accordingly, on October 18, 2022, the Company sold to the Investors an aggregate of 500,000,000 Units, consisting
of 500,000,000 shares of common stock, Warrant 1s to acquire 500,000,000 shares of common stock, and Warrant 2s to acquire 500,000,000
shares of common stock, for total consideration paid to the Company of $500,000.
On October 18, 2022, pursuant to the terms of
the SPA, the Company and the Investors entered into the Initial Registration Rights Agreement (the “Initial Registration Rights
Agreement”), which provides for the registration of all of the Purchased Shares and all of the shares of common stock that may be
acquired by the Investors pursuant to the Warrant 1s. Pursuant to the terms of the Initial Registration Rights Agreement, the Company
agreed to, within 30 calendar days of October 18, 2022, use its commercially reasonable efforts to file with the Securities and Exchange
Commission (the “SEC”) a registration statement or registration statements (as is necessary) on Form S-1 (or, if such form
is unavailable for such a registration, on such other form as is available for such registration) covering the resale of all of the Registrable
Securities, or amend its current registration statement to cover the Registrable Securities. Pursuant to the terms of the SPA, the Company
agreed to use all commercially reasonable efforts to have the registration statement declared effective by the SEC within 90 days of October
18, 2022 (the “Registration Deadline”). If such registration statement has not become effective by the Registration Deadline,
and provided that the Registrable Securities cannot otherwise be sold pursuant to Rule 144 pursuant to the Securities Exchange Act of
1934, as amended (the “Exchange Act”) as of the Registration Deadline, then, subject to the provisions of the SPA and the
Initial Registration Rights Agreement, the Company agreed to issue to each Investor:
| (i) | a number of additional shares of common stock equal to 10%
of the Purchased Shares acquired by such Investor on the closing date, with such number of Purchased Shares being adjusted for any forward
or reverse splits of the common stock between the closing date and the date of such issuance (the “Additional Shares”); and |
| (ii) | a new warrant (each, a “Warrant 3”) equal to
the number of Additional Shares in the applicable issuance. |
The Additional Shares and the Warrant 3 will,
if applicable, be issuable to the Investors for each 30-day period, or portion thereof, that the registration statement registering the
Registrable Securities has not become effective by the Registration Deadline. The Company’s obligation to issue the Additional Shares
and the Warrant 3, if applicable, will not arise until the Company has amended its articles of incorporation, via a reverse split of the
common stock, an increase of the number of authorized shares of common stock, or some combination thereof, such that the Company has a
number of authorized but unissued shares of equal to (1) the number of Additional Shares that are otherwise to be issued plus (2) the
number of shares of common stock that may be issuable pursuant to the Warrant 3.
Pursuant to the terms of the SPA, the Company
also entered into a Piggyback Registration Rights Agreement (the “Piggyback Registration Rights Agreement”), dated as of October
18, 2022, by and among the Company and the Investors. The Piggyback Registration Rights Agreement provides piggyback registration rights
for the shares of common stock that may be acquired by the Investors pursuant to the Warrant 2s. In the event that the Warrant 3s are
issued pursuant to the provisions of the SPA, then at the time of such issuances, the Company and the Investors agreed to amend the Piggyback
Registration Rights Agreement such that the Piggyback Registration Rights Agreement will also apply with respect to the shares of common
stock that may be acquired by the Investors pursuant to the Warrant 3s.
The foregoing summary of the material terms of
the Placement Agency Agreement, the SPA, Warrant 1, Warrant 2, Warrant 3, the Initial Registration Rights Agreement, and the Piggyback
Registration Rights Agreement is not complete and is qualified in its entirety by reference to the full text of the Placement Agency Agreement,
the SPA, Form of Warrant 1, Form of Warrant 2, Form of Warrant 3, the Initial Registration Rights Agreement, and the Piggyback Registration
Rights Agreement, copies of which are filed herewith as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, 10.6 and 10.7, respectively, and incorporated
by reference herein.