Item 1.01 Entry into a Material Definitive Agreement.
Subordinated Promissory Note with AirStrip Technologies, Inc.
On October 3, 2022, NantHealth, Inc. (the "Company") entered into an unsecured
subordinated promissory note (the "Note") with Airstrip Technologies, Inc., a
Delaware corporation ("Airstrip"), whereby AirStrip loaned $4,000,000 to the
Company. AirStrip is an entity affiliated with Dr. Patrick Soon-Shiong, our
Chairman of the Board of Directors (the "Board") and Chief Executive Officer.
The Note contains an 8.5% interest rate compounded annually and a maturity date
of October 31, 2026. The payment of the Note shall be subordinated and subject
in right of payment to the prior payment in full of all Senior Debt (as defined
in the Note).
The description of the related-party Note contained herein is qualified in its
entirety by reference to the Note attached hereto as Exhibit 10.1 to this
Current Report on Form 8-K and is incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
See Item 1.01 above for a discussion of the Company's Note with Airstrip.
Item 8.01 Other Events.
As previously reported, the Company received written notification from the
Listing Qualifications Department of the Nasdaq Stock Market LLC ("Nasdaq") on
August 18, 2022 stating that the Company had failed to regain compliance with
the minimum bid price requirement of $1.00 per share for continued listing of
the Company's common stock on the Nasdaq Global Select Market, as set forth in
Nasdaq Listing Rule 5810(c)(3)(A) (the "Minimum Bid Price Requirement"). The
Company timely requested a hearing before the Nasdaq Hearings Panel (the
"Panel"), which was held on September 22, 2022. Subsequent to the hearing, the
Company received notice from Nasdaq that the Panel granted the Company's request
to continue listing of the Company's common stock on Nasdaq through at least
December 1, 2022 (the "Extended Date"), subject to certain conditions, to afford
the Company the opportunity to regain compliance with the Minimum Bid Price
Requirement. The Panel has requested that on or before December 1, 2022, the
Company advise the Panel as to the current status of any efforts to increase the
Company's bid price above the Minimum Bid Price Requirement. At such time, the
Panel may determine if additional time to cure the Minimum Bid Price Requirement
deficiency is appropriate.
To regain compliance with the Minimum Bid Price Requirement, the Board approved
a 1-for-15 reverse stock split of the Company's common stock (the "Reverse Stock
Split") on August 17, 2022. Subsequently, the Company's stockholders approved
the Reverse Stock Split on August 18, 2022, and the Company filed a Definitive
Information Statement on DEF 14C with the Securities and Exchange Commission on
September 7, 2022. The Company is taking definitive steps to comply with the
terms of the Panel's decision and to timely regain compliance with the Minimum
Bid Price Requirement; however, there can be no assurance that it will be able
to do so by December 1, 2022, or that the Panel will grant a further extension
if required, notwithstanding the fact that the Panel has discretion to grant an
extension through February 14, 2023, pursuant to the Nasdaq Listing Rules.
Forward-Looking Statements:
In addition to historical information, this Current Report on Form 8-K contains
or may imply forward-looking statements within the meaning of the federal
securities laws, such as any implication that the Company's shares will continue
trading on the Nasdaq Global Select Market. Such forward-looking statements
include projections regarding the Company's beliefs and expectations about
future performance and, in some cases, may be identified by words like
"anticipate," "assume," "believe," "continue," "could," "estimate," "expect,"
"intend," "may," "plan," "potential," "predict," "project," "future," "will,"
"seek" and similar terms or phrases. These statements are based on the Company's
beliefs and assumptions, which in turn are based on information available as of
the date of this Current Report on Form 8-K. Forward-looking statements involve
known and unknown risks and uncertainties, which could cause actual results to
differ materially from those contained in any forward-looking statement and
could harm the Company's business, prospects, results of operations, liquidity
and financial condition and cause its stock price to decline significantly. Many
of these factors are beyond the Company's ability to control or predict.
Important factors that could cause the Company's actual results to differ
materially from those indicated in the forward-looking statements include, among
others: the ability to meet the bid price requirement as a result of the
proposed Reverse Split or otherwise in the future, the ability to meet Nasdaq
compliance standards, or that Nasdaq will grant the Company any relief from
delisting as necessary or whether the Company can agree to or ultimately meet
applicable Nasdaq requirements for any such relief, and the events and risks
referenced in the sections titled "Risk Factors" in the Company's Annual Report
on Form 10-K for the year ended December 31, 2021 and subsequent Quarterly
Reports on Form 10-Q and in other documents filed or furnished with the
Securities and Exchange Commission. As a result of these factors, actual results
may differ materially from those indicated or implied by forward-looking
statements. Our forward-looking statements do not reflect the potential impact
of any acquisitions, mergers, dispositions, business development transactions,
joint ventures or investments we may enter into or make in the future. Given
these uncertainties, you should not place undue reliance on these
forward-looking statements. These forward-looking statements are made only as of
the date hereof and the Company undertakes no obligation to update or revise
publicly any forward-looking statements, except as required by law. New factors
emerge from time to time, and it is not possible for us to predict all such
factors.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
10.1 Subordinated Promissory Note by and between the Company and AirStrip
Technologies, Inc. dated as of October 3, 2022.
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