UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________________________
FORM 8-K/A
(Amendment No. 1)
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
___________________________________________________________________
Date of Report (Date of earliest event reported): August 16, 2023
AULT ALLIANCE, INC.
(Exact name of registrant as specified in its charter)
| Delaware | | 001-12711 | | 94-1721931 |
(State or other jurisdiction of
incorporation or organization) | | (Commission File Number) | | (I.R.S. Employer Identification No.) |
11411 Southern Highlands Parkway, Suite 240, Las Vegas, NV 89141
(Address of principal executive offices) (Zip Code)
(949) 444-5464
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common Stock, $0.001 par value | | AULT | | NYSE American |
| 13.00% Series D Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share | | AULT PRD | | NYSE American |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
EXPLANATORY NOTE
This Current Report on Form 8-K/A (this “Amendment No. 1”) amends and restates the Current Report on Form 8-K (the “Original Form 8-K”) filed by Ault Alliance, Inc. (the “Company”) with the Securities and Exchange Commission on August 3, 2023.
This Amendment No. 1 is solely for the purpose of disclosing an amended and restated Assignment Agreement (the “A&R Assignment”), which was entered into by the Company and Ault & Company, Inc., a Delaware corporation and a related party to the Company (“A&C”), and to clarify and disclose the consideration paid by the Company to A&C for A&C to assume from the Company the Exchange Notes (as hereinafter defined).
Other than the foregoing, this Amendment No. 1 speaks as of the original date of the Original Form 8-K and does not reflect events that may have occurred subsequent to the date of the Original Form 8-K.
| Item 1.01 | Entry into a Material Definitive Agreement. |
As previously reported on a Current Report on Form 8-K filed on March 30, 2023, on March 28, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain institutional investors (the “Investors”), pursuant to which the Company agreed to issue and sell, in a private placement (the “Offering”), an aggregate of 100,000 shares of its preferred stock, with each such share having a stated value of $100.00 and consisting of (i) 83,000 shares of Series E Convertible Preferred Stock (the “Series E Preferred Stock”), (ii) 1,000 shares of Series F Convertible Preferred Stock (the “Series F Preferred Stock”) and (iii) 16,000 shares of Series G Convertible Preferred Stock (the “Series G Preferred Stock” and collectively, the “Preferred Shares”).
Each share of Series E Preferred Stock and Series F Preferred Stock had a purchase price of $100.00, equal to each such share’s stated value. The purchase price of the Series E Preferred Stock and the Series F Preferred Stock was paid for by the Investors’ canceling outstanding secured promissory notes in the then principal amount of $8.4 million (the “Prior Notes”), whereas the purchase price of the shares of Series G Preferred Stock consisted of accrued but unpaid interest on these notes, as well as for other good and valuable consideration. The Offering closed on March 30, 2023.
Exchange Agreement and Exchange Notes
The Company and the Investors entered into an Exchange Agreement (the “Exchange Agreement”) dated July 28, 2023 but effective as of August 3, 2023. The Preferred Shares had originally been acquired by the Investors through their surrender for cancellation of two Prior Notes issued to them by Sentinum, Inc., a Nevada corporation (formerly known as Bit Nile, Inc.), in the aggregate principal amount of $11 million, as reported on a Current Report on Form 8-K filed by the Company on August 11, 2022. A form of the Exchange Agreement is attached hereto as Exhibit 10.1.
Pursuant to the Exchange Agreement, the Investors exchanged (the “Exchange”) all of their Preferred Shares as well as their demand notes (the “Demand Notes”) issued to the Investors by the Company on or about May 20, 2023, with each Demand Note having a principal outstanding amount of approximately $888,000 for two new 10% Secured OID Promissory Notes (the “Exchange Notes”), each with a principal face amount of $5,272,416 as of July 28, 2023 for an aggregate of amount owed of $10,544,832 (the “Principal Amount”). A form of the Exchange Note is attached hereto as Exhibit 4.1. The Exchange Agreement closed on August 3, 2023.
Assignment
The Company and A&C entered into the A&R Assignment dated August 10, 2023 but effective as of August 3, 2023, whereby the Company assigned the Exchange Notes to A&C. As consideration for A&C assuming the Exchange Notes from the Company, the Company issued a 10% demand promissory note in the principal face amount equal to the Exchange Notes to A&C. A form of the A&R Assignment is attached hereto as Exhibit 10.2.
Guaranty
In connection with a security and pledge agreement entered into on August 3, 2023, by and among A&C and the Investors, to which the Company is not a party, the Company signed a guaranty dated July 28, 2023 but effective as of August 3, 2023, guaranteeing the full payment of A&C’s obligations under the Exchange Notes (the “Guaranty”). A form of the Guaranty is attached hereto as Exhibit 10.3. Milton C. Ault, III, the Company’s Executive Chairman, executed and delivered a similar instrument in connection with the Exchange.
The foregoing summaries of the Exchange Agreement, the Exchange Notes, the A&R Assignment and the Guaranty do not purport to be complete and are subject to, and qualified in their entirety by, forms of such documents attached as Exhibits 4.1, 10.1, 10.2, and 10.3, respectively, to this Current Report on Form 8-K, which are incorporated herein by reference.
The representations, warranties and covenants contained in the Exchange Agreement, the Exchange Notes and the A&R Assignment were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to the agreements and are subject to limitations agreed upon by the contracting parties. Accordingly, the foregoing agreements incorporated herein by reference are include herein only to provide readers with information regarding the terms of the Exchange and related matters and not to provide investors with any other factual information regarding the Company or its business and should be read in conjunction with the disclosures in the Company’s periodic reports and other filings with the Securities and Exchange Commission.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The disclosure required by this Item and included in Item 1.01 of this Current Report is incorporated herein by reference.
| Item 3.02 | Unregistered Sales of Equity Securities. |
The disclosure required by this Item and included in Item 1.01 of this Current Report is incorporated herein by reference.
| Item 3.03 | Material Modifications to Rights of Security Holders. |
The disclosure required by this Item and included in Item 1.01 of this Current Report is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
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* Filed previously.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | AULT ALLIANCE, INC. | |
| | | |
| | | |
| Dated: August 16, 2023 | /s/ Henry Nisser | |
| | Henry Nisser | |
| | President and General Counsel | |
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