LM FUNDING AMERICA, INC. (NASDAQ:LMFA) Files An 8-K Unregistered Sales of Equity SecuritiesItem 3.02Unregistered Sales of Equity Securities.
The disclosure provided in Item 8.01 of this Report is hereby incorporated by reference into this Item 3.02.The shares and warrants described in Item 8.01 were issued to Investor in reliance upon the exemption set forth in Section 3(a)(9) of the Securities Act of 1933, as amended.
Item 8.01 Other Information.
As previously disclosed in a Form 8-K filed on December 11, 2017, by LM Funding America, Inc. (the “Company”), on December 11, 2017, the Company entered into a Master Exchange Agreement (the “Agreement”) with a New York-based family office (the “Investor”).Under the Agreement, the Investor agreed to exchange two promissory notes payable by the Company and previously acquired by the Investor for a combination of shares of the Company’s common stock (“Common Stock”) and warrants to acquire common stock (the “Pre-Funded Warrants”), with the first promissory note being in the principal amount of $2,798,672.71 (the “Term Note A”) and the second promissory note being in the principal amount of $1,720,859.76 (the “Term Note B”).As previously announced, on December 11, 2017, the Term Note A was exchanged for an aggregate of 170,000 shares of Common Stock and initial Pre-Funded Warrants to purchase an aggregate of 924,595 additional shares of Common Stock, subject to the previously disclosed true-up provisions in the Agreement.The Company also disclosed in a Form 8-K filed on December 22, 2017, that the entire Term Note B was exchanged for an aggregate of 200,000 shares of Common Stock and initial Pre-Funded Warrants to purchase an aggregate of 1,270,140 additional shares of common stock, subject to the true-up provisions in the Agreement.
As of December 26, 2017, all exchanges, true-up issuances, and warrant exercises contemplated by the Agreement had been completed, with an aggregate of 2,676,378 shares of Common Stock being issued under the Agreement to the Investor.Although the pricing period for true-ups under the Exchange Agreement was scheduled to end on or around February 11, 2018, the Investor has informed the Company that the Investor elected to end the pricing period on December 26, 2017.After giving effect to the issuance of such shares, the total number of shares of issued and outstanding Common Stock was 5,976,378 as of December 26, 2017.As a result of the transactions contemplated by the Agreement, the Company’s entire indebtedness to Heartland Bank has been satisfied.