Item 1.01 Entry into a Material Definitive Agreement
On
Upon the closing of the Purchase Agreement (the "Closing"), the Company will acquire all of Evrythng's outstanding share capital for the consideration described below and Evrythng will become a wholly owned subsidiary of the Company (the "Acquisition").
Upon the Closing, the Company will acquire all outstanding shares of Evrythng's
share capital held by the Sellers for (i) aggregate initial consideration of
The Company Warrants issuable at Closing will be exercisable for a number of
shares of Company Common Stock (the "Warrant Shares") equal to approximately the
quotient of (i) 1.3 times (1.3x) the Closing Costs, divided by (ii) the First
Payment Stock Price. The aggregate exercise price of all the Company Warrants
will be equal to the Closing Costs. The per share exercise price of the Company
Warrants will be equal to the quotient of (i) the Closing Costs, divided by
(ii) the total number of Warrant Shares. The Company Warrants will expire on the
later of (i)
At the Closing, the Company will assume all vested options to purchase Evrythng
capital shares that are held by
The Second Payment Consideration (if any) will be calculated in part based on
whether Evrythng achieves annual recurring revenue, as defined in the Purchase
Agreement, of
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(a) if the intraday volume-weighted average price of Company Common Stock as
reported on the Nasdaq Global Market for the 20 consecutive trading days ending
on (and including)
(b) if the Second Payment Stock Price is equal to or less than the First
Payment Stock Price and the Product ARR Milestone is not achieved, a number of
shares of Company Common Stock equal to (i) (A)
(c) if the Second Payment Stock Price is greater than the First Payment Stock
Price but less than two times (2.0x) the First Payment Stock Price and the
Product ARR Milestone is achieved, a number of shares of Company Common Stock
equal to (i)
(d) if the Second Payment Stock Price is greater than the First Payment Stock
Price but less than two times (2.0x) the First Payment Stock Price and the
Product ARR Milestone is not achieved, a number of shares of Company Common
Stock equal to (i) (A)
(e) if the Second Payment Stock Price is greater than the First Payment Stock Price by two times (2.0x) or more, no consideration (i.e., there would be no Second Payment Consideration in this scenario, regardless of whether or not the Product ARR Milestone is achieved).
With respect to Evrythng's potential achievement of the Product ARR Milestone, the Company has agreed, among other things, to operate the Evrythng business in good faith in order to support the achievement of the Product ARR Milestone, and not to take any action with the purpose of preventing the achievement of the Product ARR Milestone.
In addition, in connection with the Purchase Agreement, the Company is entering
into a loan agreement with Evrythng (the "Bridge Loan Agreement"). Under the
terms of the Bridge Loan Agreement, the Company has agreed to lend to Evrythng
up to
Item 3.02 Unregistered Sales of
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
Item 8.01 Other Events.
On
Forward Looking Statements
This Current Report on Form 8-K may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including the expected completion of the transactions contemplated by the Purchase Agreement, the time frame in which this will occur, and the estimated cash costs to be funded by the Company. Statements regarding future events are based on the parties' current expectations and are necessarily subject to associated risks related to, among other things, conditions to the Closing that may not be satisfied, the potential impact on the business of the Company due to the announcement of the acquisition, the occurrence of any event, change or other circumstances that could give rise to the termination of the Purchase Agreement, changes to Evrythng's financial condition (including any unknown or unexpected liabilities), and general economic conditions. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. For information regarding other related risks, see the "Risk Factors" section of the Company's most recent annual report on Form 10-K. The forward-looking statements included herein are made only as of the date hereof, and the Company undertakes no obligation to revise or update any forward-looking statements for any reason.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Exhibit Description 99.1 Press Release, datedNovember 15, 2021 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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