SEC Filing Summary: Amedica Corporation (8-K)
Business Context and Reporting Period
Company: Amedica Corporation (Note: Request metadata listed "Sintx Technologies, Inc.", but the filing text identifies the registrant as Amedica Corporation).
Filing Date: May 10, 2018 (Report Date: May 15, 2018).
Event: Entry into a Material Definitive Agreement for a public offering of Series B Convertible Preferred Stock and Warrants. The offering closed on May 14, 2018.
Key Financial Metrics and Transaction Details
- Offering Size: 15,000 units sold at $1,000 per unit, totaling $15,000,000 in gross proceeds.
- Security Structure: Each unit consists of one share of Series B Convertible Preferred Stock (stated value $1,100) and 758 Warrants to purchase Common Stock.
- Conversion Terms: Initial conversion price of $1.4512 per share (758 shares per preferred share). Subject to full ratchet anti-dilution adjustments and a floor price of $0.48.
- Warrant Terms: Exercise price of $1.60 per share; exercisable immediately; 5-year term.
- Debt Repayment: Proceeds were used to satisfy Senior Secured Convertible Promissory Notes held by Anson Investments Master Fund LP and MEF I, L.P.
- Liquidity Impact: The filing indicates cash proceeds exceeded $2,000,000, triggering acceleration rights for a separate note held by L2 Capital LLC.
Material Changes and Obligations
- Capital Structure Change: Creation of Series B Preferred Stock, which ranks senior to Common Stock regarding redemption and liquidation (on an as-converted basis).
- Debt Acceleration: Notification given to L2 Capital LLC regarding the receipt of proceeds exceeding $2,000,000. L2 may elect to accelerate payment of an $840,000 OID promissory note (purchased for $750,000).
- Beneficial Ownership Limits: Holders of Preferred Stock and Warrants are restricted from converting/exercising if it results in beneficial ownership exceeding 4.99% (or 9.99% at election) of outstanding Common Stock.
Guidance, Risks, and Unusual Items
- Dilution Risk: The securities contain aggressive anti-dilution provisions (full ratchet) that could significantly lower the conversion price if the company issues equity at a lower price in the future.
- Forced Conversion: The Company has the right to force conversion if the Common Stock VWAP exceeds $4.3536 for 30 consecutive trading days with daily volume over $500,000.
- Redemption: The Company may redeem the Series B Preferred Stock after six months at a 25% premium to the stated value.
- Legal Jurisdiction: Disputes are subject to exclusive jurisdiction in New York courts with a waiver of jury trial.
Investor Verification Checklist
- Verify the exact amount of net proceeds received after underwriting discounts and expenses.
- Confirm the status of the L2 Capital LLC note acceleration and whether it has been repaid.
- Review the Certificate of Designation (Exhibit 3.1) for specific exclusions to the full ratchet anti-dilution provision.
- Assess the impact of the 15,000 units (plus warrants) on the fully diluted share count and potential future dilution.
- Check if the registration statement for the underlying Common Stock remains effective for warrant exercises.