Filing Summary
Business Context and Reporting Period
This Form 8-K was filed by Akerna Corp. (not American Bitcoin Corp.) regarding a material amendment dated September 28, 2023, to its securities purchase agreement with MJ Acquisition Corp. The agreement relates to the proposed sale of Akerna’s interests in MJ Freeway, LLC and Ample Organics Inc. The report was signed October 4, 2023.
Key Financial and Transaction Terms
- Cash consideration payable at closing was reduced from $4.0 million to $2.0 million.
- MJ Acquisition Corp. agreed to provide Akerna an additional $500,000 working-capital loan within three business days of the amendment.
- The related secured convertible promissory note was amended and restated, increasing principal from $1.0 million to $1.5 million.
- Accrued and unpaid interest on the note will be forfeited by MJ Acquisition Corp. upon consummation of the transaction.
- Immediately before closing, the $1.5 million principal is intended to convert into Akerna common stock based on the five-trading-day volume-weighted average price preceding closing.
- The conversion and other share issuances are capped at 19.99% of Akerna’s outstanding common stock unless Akerna stockholder approval is obtained under Nasdaq rules.
- The filing provides no revenue, profit, cash-flow, margin, debt, or liquidity metrics for the reporting period.
Material Changes Versus Prior Terms
- The transaction outside date was extended from September 29, 2023, to December 31, 2023.
- Akerna stockholder approval will also be sought for the issuance of shares under the amended and restated note.
- MJ Acquisition Corp. must use good-faith, best-efforts assistance to seek the highest possible purchase price for Ample Organics.
- If Ample Organics is sold to a third party for net proceeds above $700,000, Akerna may retain the excess over $700,000; proceeds up to that threshold are included in the assets of MJ Freeway at closing.
Outlook, Risks, and Unusual Items
Closing remains subject to conditions including stockholder approval and other required approvals. The filing highlights risks involving delayed or failed closing, operating and transaction expenses, access to additional capital, possible changes in ownership resulting from share-price adjustments, unexpected costs, adverse business reactions, failure to realize anticipated benefits, and possible Nasdaq suspension or delisting.
The filing also contains solicitation and forward-looking-statement disclaimers. It directs investors to Akerna’s registration statement, proxy statement/prospectus, and other SEC filings for additional transaction details and risk factors.
Facts Investors Should Verify
- Confirm the issuer identity: the supplied filing is for Akerna Corp., while the request identifies American Bitcoin Corp.
- Verify whether the transaction closed by December 31, 2023, and whether all required stockholder and regulatory approvals were obtained.
- Verify funding of the additional $500,000 loan and the final conversion price and number of shares issued under the amended note.
- Review the final disposition and proceeds from Ample Organics, including any amount retained above $700,000.
- Review subsequent filings for Akerna’s liquidity, Nasdaq listing status, transaction expenses, and any changes to the agreement.