Item 1.01 Entry into a Material Definitive Agreement.
On May 6, 2021,
| | (i) | American Superconductor Corporation, a Delaware corporation (the “Company”), entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Antonio Capanna, Sr. (“Capanna, Sr.”), Antonio Capanna, Jr. (“Capanna, Jr.”), The Antonio Capanna 2010 Spousal Lifetime Access Trust Dated December 28, 2010 (the “Trust, and together with Capanna, Sr., the “Neeltran, Inc. Selling Stockholders”) and the Other Seller Parties, and |
| | (ii) | AMSC Husky LLC, the Company’s wholly-owned Connecticut limited liability company (“AMSC Husky”), entered into a Purchase and Sale Agreement (the “Real Property Purchase Agreement,” and together with the Stock Purchase Agreement, the “Purchase Agreements”) with 71 Pickett District Road, LLC (the “Owner”), Capanna, Sr. and Filomena Capanna (“F. Capanna,” and together with Owner and Capanna, Sr., the “RE Selling Parties”). |
Stock Purchase Agreement
Pursuant to the terms of the Stock Purchase Agreement and concurrently with entering into such agreement, the Company purchased all of the issued and outstanding shares of capital stock of (i) Neeltran, Inc., a Connecticut corporation (“Neeltran”) that supplies rectifiers and transformers to industrial customers, and (ii) Neeltran International, Inc., a Connecticut corporation (“International”), for: (a) $1.0 million in cash, and (b) 301,556 shares of the Company’s common stock, $0.01 par value per share (“AMSC Shares”), that were paid and issued to the Neeltran, Inc. Selling Stockholders, respectively, at closing. The Company also paid $1.1 million to Capanna, Sr. and Capanna, Jr. at closing to pay off previous loans made by them to Neeltran.
Additionally, the Company paid approximately $7.6 million, including $1.9 million of indebtedness secured by the mortgage on the real property as described below, directly to Neeltran lenders at closing to extinguish outstanding Neeltran indebtedness to third parties.
Under the terms of the Stock Purchase Agreement, the Company is obligated to file either (i) a new registration statement, or (ii) a prospectus supplement to an already effective Company registration statement, covering the resale of the AMSC Shares by the Neeltran, Inc. Selling Stockholders no later than ten business days following the closing, and in the case of a new registration statement, to use commercially reasonable efforts to cause such registration statement to be declared effective by the Securities and Exchange Commission (“SEC”) as soon as practicable thereafter. In the event that a new registration statement has not been declared effective by the SEC, or a prospectus supplement to an already effective Company registration statement has not been filed, as the case may be, within thirty days following the closing, the Company is obligated to pay, no later than the date that is forty-five days after the closing, an amount in cash equal to the purchase price originally paid in AMSC Shares (the “Cash Payment”) and the Neeltran, Inc. Selling Stockholders shall furnish to the Company all documentation as reasonably requested by the Company for the cancellation of the AMSC Shares.
Real Property Purchase Agreement
Pursuant to the terms of the Real Property Purchase Agreement and concurrently with entering into such agreement, AMSC Husky purchased the real property that serves as Neeltran’s headquarters for $4.3 million, of which (a) $2.4 million was paid in immediately available funds by AMSC Husky to the RE Selling Parties, and (b) $1.9 million was paid directly to TD Bank as full payment for the outstanding indebtedness secured by the mortgage on such real property.
The Purchase Agreements also contain customary representations, warranties, covenants and indemnities.
The AMSC Shares issued to the Neeltran, Inc. Selling Stockholders were issued in reliance on the exemption from the registration provisions of Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), relating to sales by an issuer not involving any public offering.
The sale of the AMSC Shares pursuant to the Stock Purchase Agreement has not been registered under the Securities Act or any state securities laws. The AMSC Shares may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws. This Current Report on Form 8-K is not an offer to sell or the solicitation of an offer to buy shares of common stock or other securities of the Company.
The foregoing descriptions of the Stock Purchase Agreement and the Real Property Purchase Agreement are not complete and are qualified in their entirety by reference to the full text of such agreements, copies of which are filed herewith as Exhibit 10.1 and Exhibit 10.2, respectively, to this Current Report on Form 8-K and is incorporated herein by reference.
