Business Context and Reporting Period
This Form 8-K was filed by WiSA Technologies, Inc. (not Datavault AI Inc.) on April 7, 2023. The filing reports the entry into a Material Definitive Agreement involving a registered direct offering of common stock and a concurrent private placement of warrants.
Key Financial Metrics and Transaction Details
- Securities Issued: 743,066 shares of Common Stock and warrants exercisable for up to 1,486,132 shares.
- Offering Price: $1.66 per share of Common Stock plus accompanying Private Placement Warrant.
- Warrant Terms: Exercise price of $1.41 per share; immediately exercisable; expire five years from issuance.
- Gross Proceeds: Approximately $1.2 million from the initial offering.
- Potential Additional Proceeds: Approximately $2.1 million if all Private Placement Warrants are exercised for cash.
- Debt Repayment Obligation: At least 20% of gross proceeds must be used to repay a senior secured convertible note issued in August 2022.
Material Changes and Use of Proceeds
The primary material change is the capital raise intended to improve liquidity and reduce debt. The Company intends to use net proceeds for:
- Partial or full repayment of the outstanding principal of the senior secured convertible note.
- Working capital, capital expenditures, and product development.
- General corporate purposes, including sales and marketing investments in the U.S. and internationally.
The offering is expected to close on or about April 12, 2023, subject to customary closing conditions.
Guidance, Restrictions, and Risks
- Lock-up Periods: The Company is restricted from issuing securities for 60 days post-closing and from entering into Variable Rate Transactions for six months post-closing.
- Registration Requirements: The Company must file a Form S-1 within 45 days of closing to register the resale of shares underlying the warrants and keep it effective until no investor holds such warrants.
- Forward-Looking Statements: The filing contains projections regarding the closing date and use of proceeds, which are subject to risks including market conditions and the ability to satisfy closing conditions.
- Warrant Call Feature: The Company may call the Private Placement Warrants at $0.50 per warrant under certain conditions if the underlying shares are registered or resalable under Rule 144.
Investor Verification Checklist
- Verify the actual closing date of the offering (expected April 12, 2023) and confirm receipt of gross proceeds.
- Confirm the specific amount of the August 2022 Convertible Note repaid with the proceeds.
- Monitor the filing of the required Form S-1 registration statement for the warrant shares within 45 days of closing.
- Review the full text of the Securities Purchase Agreement (Exhibit 10.1) for detailed covenants and termination provisions.
- Check subsequent filings for any updates on the exercise of Private Placement Warrants.