Soluna Holdings Inc
For the period ended Apr 29, 2024. Filed Apr 29, 2024.
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Apr 29, 2024 · Filed Apr 29, 2024
Contents
Background
On October 20, 2021, we entered into a securities purchase agreement (the “SPA”) with certain accredited investors (the “Noteholders”), and issued to the Noteholders, upon closing of the offering on October 25, 2021, convertible secured notes (the “Notes”) in the aggregate principal amount of $16,304,348, for an aggregate purchase price of $15,000,000.
On February 28, 2024 the Company and the Noteholders entered into a Fourth Amendment Agreement (the “Fourth Amendment Agreement”) to amend the Notes, SPA and related agreements (collectively, the “Transaction Documents”) to facilitate future financings by the Company by amending the Transaction Documents as follows:
The Company shall be permitted undertake at-the-market transactions (“ATMs”) in the future provided:
| ● | No Event of Default shall have occurred and be continuing under the Notes; and |
| ● | The market price of the shares of common stock shall be at least the ATM Floor Price. ATM Floor Price means $10 per share initially, which is reduced to $8 per share six months after the ATM is effective and $6 per share 12 months after the after the effective date of the ATM. |
In addition, the Company will be permitted to unilaterally extend the maturity date of the Notes for two 3-Month extensions if prior to the then in effect maturity date the Company gives notice to the Purchasers and increases the principal amount of the Notes on the date of each such extension by two percent (2%) the principal amount of the Notes outstanding on the date of this Agreement per each extension.
In consideration of the foregoing, the Company will:
| ● | Reduce the conversion price of the Notes to $3.78 per share; |
| ● | The Purchasers will receive an aggregate of 850,000 three year warrants exercisable at $0.01 per share (the “Penny Warrants”); |
| ● | An aggregate of 320,005 warrants held by the Purchasers will have the exercise price reduced to $3.78 per share (the “$3.78 Warrants”); |
| ● | An aggregate of 478,951 warrants held by the Purchasers will have the exercise price reduced to $6.00 per share (the “Repriced Warrants”). For every one Repriced Warrant exercised by a Purchaser, such Purchaser shall receive 1.36 new five year warrants with an exercise price of $0.01, 1.6 new five year warrants with an exercise price of $4.20, and 1.6 new five year warrants with an exercise price of $5.70 (the “Bonus Warrants”). |
Pursuant to additional agreements with holders of another 51,618 outstanding warrants, similar adjustments with those warrants, resulting in a total adjustment to 530,569 warrants.
We are holding the Annual meeting of our stockholders for the additional purpose of obtaining stockholder approval of reductions in the conversion prices of the Notes, the reduction of the exercise prices of the $3.78 Warrants and Repriced Warrants, and the issuance of the Penny Warrants and the Bonus Warrants.,
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