Ecoark Holdings, Inc. (OTCMKTS:EARK) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.
| Entry into a Material Definitive Agreement. |
On March 14, 2017, Ecoark Holdings, Inc. (the
Company) entered into a Securities Purchase
Agreement (the Purchase Agreement) with two
institutional investors (the Investors) for the
sale by the Company of 2,000,000 shares (the Common
Shares) of the Companys common stock, par value $0.001
per share (the Common Stock), at a purchase
price of $4.00 per share in a registered direct offering. The
investors in this offering also purchased warrants to purchase
1,000,000 shares of Common Stock (the Warrants).
The aggregate gross proceeds for the sale of the Common Shares
and Warrants will be $8.0 million, excluding potential proceeds
from the exercise of the Warrants.Subject to certain ownership
limitations, the Warrants will be exercisable commencing on the
issuance date at an exercise price equal to $5.00 per share of
Common Stock, subject to adjustments as provided under the terms
of the Warrants. The Warrants are exercisable for five years from
the date of issuance. The closing of the sales of these
securities under the Purchase Agreement is expected to occur on
March 17, 2017, subject to customary closing conditions.
Rodman Renshaw, a unit of H.C. Wainwright Co. (the
Placement Agent), is acting as the exclusive
placement agent in connection with the offering. The Company has
agreed to pay Placement Agent an aggregate fee equal to 7% of the
gross proceeds received by the Company from the sale of the
securities in the transactions plus a management fee equal to 1%
of the gross proceeds from this offering. to the Engagement
Letter, the Company also agreed to reimburse the Placement Agent
for certain expenses in the amount of up to $100,000 and grant to
the Placement Agent or its designees five-year warrants to
purchase up to 7% of the aggregate number of shares sold in the
transactions at an exercise price equal to $5.00 per share (the
Placement Agent Warrants). The Engagement Letter
has a twelve-month tail period and an eight-month right of first
offer period, indemnity and other customary provisions for
transactions of this nature. The Placement Agent Warrants and the
shares issuable upon exercise of the Placement Agent Warrants
will be issued in reliance on the exemption from registration
provided by Section4(a)(2)of the Securities Act as transactions
not involving a public offering and in reliance on similar
exemptions under applicable state laws.
The net proceeds to the Company from the transactions, after
deducting the placement agents fees and expenses (not including
the Placement Agent Warrants), the Companys estimated offering
expenses, and excluding the potential proceeds, if any, from the
exercise of the Warrants, are expected to be approximately $7.3
million. The Company intends to use the net proceeds from the
offering for growth working capital and increasing its
stockholders equity as it prepares to complete its application
for uplisting on the NASDAQ Capital Market following both the
changing of its fiscal year end to March 31, 2017 and the filing
of its March 31, 2017 audited financial statements.
The Common Shares and the Warrants sold in the offering were
offered and sold by the Company to an effective shelf
registration statement on FormS-3, which was filed on August 7,
2017 with the Securities and Exchange Commission (the
SEC) and declared effective on August 24, 2016
(File No.333-213186) (the Registration
Statement). The Company will file a prospectus
supplement with the SEC in connection with the sale of the
securities.
The representations, warranties and covenants contained in the
Purchase Agreement were made solely for the benefit of the
parties to the Purchase Agreement. In addition, such
representations, warranties and covenants (i)are intended as a
way of allocating the risk between the parties to the Purchase
Agreement and not as statements of fact, and (ii)may apply
standards of materiality in a way that is different from what may
be viewed as material by stockholders of, or other investors in,
the Company. Accordingly, the Purchase Agreement is included with
this filing only to provide investors with information regarding
the terms of transaction, and not to provide investors with any
other factual information regarding the Company. Stockholders
should not rely on the representations, warranties and covenants
or any descriptions thereof as characterizations of the actual
state of facts or condition of the Company or any of its
subsidiaries or affiliates. Moreover, information concerning the
subject matter of the representations and warranties may change
after the date of the Purchase Agreement, which subsequent
information may or may not be fully reflected in public
disclosures.
The forms of the Purchase Agreement and the Warrant, are filed as
Exhibits 10.1 and 4.1, respectively, to this Current Report on
Form8-K. The foregoing summaries of the terms of these documents
are subject to, and qualified in their entirety by, such
documents, which are incorporated herein by reference.
The legal opinion and consent of Carmel, Milazzo DiChiara LLP
relating to the securities is filed as Exhibit 5.1 to this
Current Report on Form 8-K and is incorporated herein by
reference.
| Item3.02. | Unregistered Sales of Equity Securities. |
See Item 1.01 with respect to the Placement Agent Warrants.
| Item8.01. | Other Events. |
On March 14, 2017, the Company issued a press release regarding
the transactions described above under Item 1.01 of this Current
Report on Form 8-K. A copy of the press release is attached
hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in this Item 8.01 of this Current Report on Form
8-K, including Exhibit 99.1 attached hereto, shall not be deemed
filed for purposes of Section 18 of the United States Securities
Exchange Act of 1934 (the Exchange Act) or
otherwise subject to the liabilities of that section, nor shall
it be deemed incorporated by reference in any filing under the
United States Securities Act of 1933 or the Exchange Act, except
as shall be expressly set forth by specific reference in such a
filing.
| Item9.01. | Financial Statements and Exhibits. |
| (d) | Exhibit No. | Description. | ||
| 4.1 | Form of Warrant Agreement of Ecoark Holdings, Inc. | |||
| 5.1 | Opinion of Carmel, Milazzo DiChiara LLP | |||
| 10.1 |
Form of Securities Purchase Agreement, dated March 14, 2017, by and between Ecoark Holdings, Inc. and various purchasers named therein |
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| 23.1 |
Consent of Carmel, Milazzo DiChiara LLP (included in the opinion of Carmel, Milazzo DiChiara LLP as Exhibit5.1) |
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| 99.1 | Press Release, dated March 14, 2017 |
About Ecoark Holdings, Inc. (OTCMKTS:EARK)
Ecoark Holdings, Inc. is a technology solutions company. The Company offers technologies to fight waste in operations, logistics, and supply chains worldwide. It provides pallet-level time and temperature tracking, pre-cool prioritization and monitoring, pallet routing, real-time in-transit monitoring, remote visibility, and quality management solutions. The Company also offers Point Clouds, which creates two dimensional (2d) and three dimensional (3d) digital replications; High definition (HD) photos, a 360 degree rotational bubble image from various project perspectives; 2d Plans that plan and elevates views in CAD/PDF; and 3d models, such as Revit, CAD, Cyclone, 3dS, and others; as well as provides training and consultation services on laser scan and/or creates 2d as-builts or 3d models. In addition, it provides tech driven consumer products. Ecoark Holdings, Inc. (OTCMKTS:EARK) Recent Trading Information
Ecoark Holdings, Inc. (OTCMKTS:EARK) closed its last trading session down -1.75 at 6.00 with 162,122 shares trading hands.