DIGITAL POWER CORPORATION (DPW) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On November 15, 2016, Digital Power Company, a California
corporation (the Company), entered into a subscription agreement
(the Subscription Agreement) with the purchasers listed on the
page thereto (the Investors). to the terms of the Subscription
Agreement, the Company sold approximately 901,666 units (Units)
at $0.60 for an aggregate purchase price of approximately
$541,000. Each unit consists of one share of common stock (Common
Stock) and one warrant to purchase one share of common stock (the
Warrant Shares) at an exercise price of $0.80 (the Financing).
The Financing closed on November 15, 2016 (Closing).
In connection with the Financing, the Company entered into a
registration rights agreement (the Registration Rights Agreement)
with the Investors.
At the Closing, the Company received gross proceeds of
approximately up to $541,000.
The Subscription Agreement provides that, until November 15,
2017, Investors who purchased at least $100,000 have the right to
participate in the purchase of up to 50% of the securities
offered by the Company in any future financing transactions, with
limited exceptions.
Description of the Warrants
The Warrants entitle the holders to purchase, in the aggregate,
up to 901,666 shares of Common Stock at an exercise price of
$0.80 per share for a period of three years. The Warrants are
exercisable upon the six month anniversary of the issuance date.
The exercise price of the Warrants is subject to adjustment for
stock splits, stock dividends, combinations or similar events.
The Warrants may be exercised for cash or, upon the failure to
maintain an effective registration statement, on a cashless
basis.
Registration Rights Agreement
The Company entered into a Registration Rights Agreement to which
the Company agreed to register (a) all of the shares of Common
Stock then issued as part of the Units and (b) all Warrant Shares
then issued and issuable upon exercise of the Warrants (assuming
on such date the Warrants are exercised in full without regard to
any exercise limitations therein). to the Registration Rights
Agreement, the Company is required to file the initial
registration statement no later than December 15, 2016 and to
have such registration statement declared effective by February
14, 2017, or March 15, 2017 if the SEC conducts a full review. If
the Company is unable to meet its obligations under the
Registration Rights Agreement, it may be required to pay certain
cash damages to holders of the Warrants.
The foregoing are only brief descriptions of the material terms
of the Subscription Agreement, the Warrants, and Registration
Rights Agreement, which are attached hereto as Exhibits 4.1,
10.1, and 10.2, respectively, and are incorporated herein by
reference. The foregoing does not purport to be a complete
description of the rights and obligations of the parties
thereunder and such descriptions are qualified in their entirety
by reference to such exhibits.
Item 3.02 Unregistered Sales of Equity
Securities.
The information contained in Item 1.01 of this Current Report
on Form 8-K is incorporated herein by reference to this Item
3.02. The Debentures and the Warrants described in this Current
Report on Form 8-K were offered and sold to an instructional
accredited investor in reliance upon exemption from the
registration requirements under Section 4(a)(2) under the
Securities Act of 1933, as amended (Securities Act), and Rule
506 of Regulation D promulgated thereunder.
Item 9.01 Financial Statements and
Exhibits.
(d) Exhibits.
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4.1 |
Form of Warrant |
|
10.1 |
Form of Subscription Agreement |
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10.2 |
Form of Registration Rights Agreement |
About DIGITAL POWER CORPORATION (DPW)