Item 3.02 Unregistered Sales of Equity Securities
On January 26, 2023, Sigma Additive Solutions, Inc. ("we," "our," "us," or the
"Company") agreed to issue to a holder of 132 shares of the Company's
outstanding Series D Preferred Stock (the "Preferred Shares") a five-year
warrant to purchase up to 225,000 shares of common stock of the Company at an
initial exercise price of $0.58 per share, the closing price of the common stock
as reported on the Nasdaq Capital Market on such date, which exercise price is
subject to adjustment in the event of a stock split, reverse stock split and
similar events. The warrant was issued in consideration of the holder's
agreement to convert, in full, the Series D Shares in accordance with their
terms into 270,828 shares of common stock, which equates to a conversion price
of $0.58 per share. The warrant was issued without registration under the
Securities Act of 1933, as amended, in reliance on the exemptions from
registration under Section 4(a)(2) of the Securities Act of 1933, as amended
(the "Act"), and Rule 506(b) of Regulation D under the Act.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Compensatory Arrangements of Certain Officers
As previously reported, on July 1, 2022, the Board of Directors (the "Board") of
the Company adopted certain compensatory arrangements of our named executive
officers, including a retention bonus plan and a change in control plan of Jacob
Brunsberg, our Chief Executive Officer, Frank Orzechowski, our Chief Financial
Officer and Darren Beckett, one of our other named executive officers, whom we
collectively refer to in this Report as the "Participating Executives." The
change in control plan contemplated that the Participating Executives each would
be entitled to a cash payment equal to his base annual salary in effect on July
1, 2022 if his employment is terminated "without cause" within 180 days
following a "change in control." At a meeting of the Board on January 24, 2023,
upon the recommendation of the Compensation Committee of the Board, the Board
determined to modify the change in control plan to provide that Messrs.
Brunsberg and Orzechowski each would be entitled to a cash payment equal to two
times his base annual salary in effect on July 1, 2022, less any base salary
payments received between the date of the "change in control" and the
termination date, if his employment is terminated "without cause" within two
years, rather than 180 days, following a "change in control."
Also on January 24, 2023, the Board approved the form of Retention Bonus and
Change in Control Agreements with each of the Participating Executives
memorializing the retention bonus plan and the change in control plan as
modified as it relates to Messrs. Brunsberg and Orzechowski as described above.
Upon the recommendations of management and of the Compensation Committee, the
Board also approved the grant to the non-employee directors, officers and key
employees of the Company under the Company's 2013 Equity Incentive Plan of
nonqualified stock options to purchase an aggregate of up to 433,665 shares of
common stock of the Company. The stock options will have an exercise price of
$0.58 per share, the market price of the common stock as reported on the Nasdaq
Capital Market on January 26, 2023, and will otherwise be on the terms and
provisions set forth in the Company's standard-form stock option agreements for
non-employee directors and officers and other employees.
Item 8.01 Other Information.
Workforce Change
As previously reported, the Company believes the additive manufacturing industry
continues to evolve and that there is also a trend toward consolidation in the
industry as companies align for profitability. The Company continues to believe
alignment with a strategic partner may allow for common growth, vision, and
funding of the Company to achieve its mission, as well as an opportunity for
other strategic relationships, including potential acquisitions that can further
accelerate the execution of our digital quality vision. In this regard, the
Company recently furloughed several of its workforce to conserve its existing
cash while it considers possible strategic or financing transactions.
Anti-dilution Adjustments
The Company's outstanding January 2020 warrants to purchase up to a total of up
to 516,400 shares of common stock and April 2020 warrants to purchase up to
383,306 shares of common stock, respectively, at exercise prices of $2.50 per
share contain so-called full-ratchet anti-dilution provisions that are triggered
by the sale or issuance of common stock or common stock derivatives at an
effective price per share below the exercise price of the warrants, including
the recent stock option grants described in Item 5.02, above. As a result, the
exercise prices of the warrants will be reduced to $0.58 per share and the
number or shares purchasable upon exercise of the April 2020 warrants will
increase to 1,648,302.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit Number Description
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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