SeqLL : Material Agreement - Form 8-K

Item 1.01 Entry Into a Material Definitive Agreement.

Amendment No. 4 to the Merger Agreement

As previously reported, on May 29, 2023, SeqLL, Inc., a Delaware corporation (the "Company"), SeqLL Merger LLC, a Delaware limited liability company and a wholly-owned subsidiary of the Company ("Purchaser Sub"), Atlantic Acquisition Corp, a Delaware corporation ("Atlantic"), Atlantic Merger LLC, a Delaware limited liability company and a majority-owned subsidiary of Atlantic ("Atlantic Merger Sub"), Lyneer Investments, LLC, a Delaware limited liability company ("Lyneer"), IDC Technologies, Inc., a California corporation ("IDC"), and Lyneer Management Holdings LLC, a Delaware limited liability company ("Lyneer Management"), entered into an Agreement and Plan of Reorganization, as amended on June 23, 2023, on October 5, 2023, and on October 17, 2023 (the "Merger Agreement"), pursuant to which (i) Atlantic Merger Sub will be merged with and into Lyneer, with Lyneer continuing as the surviving entity (the "Lyneer Merger"), and (ii) Purchaser Sub will subsequently be merged with and into Lyneer, with Lyneer continuing as the surviving entity and as a wholly-owned subsidiary of the Company (the "SeqLL Merger" and, together with the Lyneer Merger, the "Mergers").

On November 3, 2023, the Company entered into Amendment No. 4 to the Agreement and Plan of Reorganization (the "Amendment") with the other parties thereto. Prior to the Amendment, as consideration for the acquisition by the Company of Lyneer in the Mergers, the Company was to (i) pay to IDC and Lyneer Management an aggregate of $35,000,000 in cash (the "Cash Consideration") and (ii) issue to (a) IDC and Lyneer Management a number of shares of the Company's common stock (the "Lyneer Stock Consideration") equal to the quotient of $55,000,000 divided by the price per share (the "Offering Price") at which the Company's common stock is sold in the Capital Raise (as defined in the Merger Agreement) , of which 90% percent of such shares will be issued to IDC and 10% percent of such shares will be issued to Lyneer Management and (b) Atlantic a number of shares of the Company's common stock (the "Atlantic Stock Consideration") to be determined based upon the following formula:

(A/B) - [(C/B) + D]

Where:

A= $150,000,000

B= the Offering Price

C= $67,000,000

D= number of shares of the Company's common stock sold in the Capital Raise

(exclusive of shares issued in respect of any over-allotment option).

The Amendment amends (i) the Lyneer Stock Consideration such that 90% of the shares that were previously issuable to IDC shall now be issuable at the direction of IDC to Prateek Gattani,,the Chief Executive Officer and principal stockholder of IDC and the Chairman of the Board of the Company following the Mergers, (ii) the Atlantic Stock Consideration to be a number of shares of the Company's common stock equal to the quotient of $43,000,000 divided by the Offering Price, and (iii) the Cash Consideration such that $20,000,000 of the aggregate $35,000,000 of Cash Consideration payable to IDC and Lyneer Management shall now be paid in the form of a convertible promissory note in the principal amount of $20,000,000 (the "Merger Note"), which shall be issued to IDC. The Merger Note will not bear interest and will not be convertible prior to an event of default under the Merger Note. If an event of default should occur under the Merger Note, the Merger Note will bear interest at the rate of 7% per annum commencing upon the date of such event of default and will be convertible into shares of the Company's common stock at a price per share that equals then-current market prices, but not less than 80% of the price per share at which the Company's common stock is sold in the Capital Raise. If the Merger Note is convertible into shares of the Company's common stock, IDC would have demand and incidental registration rights with respect to such shares.

Additionally, prior to the Amendment, in connection with the consummation of the Mergers, the Company was required to declare (i) a cash dividend payable to its stockholders of record as of April 26, 2023 (the "Record Date") in an amount equal to the Company's cash and cash equivalents as of the closing date of the SeqLL Merger (exclusive of any proceeds of the Capital Raise), less any amounts withheld for taxes and certain other obligations as of such date and (ii) a stock dividend issuable to such stockholders of an aggregate of 819,352 shares of the Company's common stock, assuming a public offering price of $10.00 per share in the Capital Raise. The Amendment removes the requirement for the declaration of such dividends in consideration of the Company's agreement to make a settlement offer within 90 days of the closing of the Mergers to its stockholders of record as of the Record Date for such dividends to settle any claims for failing to pay such dividends by issuing to such stockholders the amount of cash and the number of shares of the Company's common stock that such stockholders would have received had such dividends been declared and made.