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SCWorx Corp. (NASDAQ:WORX) entered into warrant inducement agreements with certain holders of its existing warrants, according to a press release statement based on a filing with the Securities and Exchange Commission.
On Wednesday, the company announced that holders of its existing warrants agreed to exercise warrants to purchase up to an aggregate of 2,064,000 shares of common stock at an exercise price of $0.3496 per share. The exercise period ran until 4:00 p.m. Eastern Time on Thursday. As a result, SCWorx received gross proceeds of approximately $721,574 before fees and expenses.
In exchange for the holders’ agreement to exercise the existing warrants, SCWorx will issue new unregistered warrants to purchase an aggregate of 4,128,000 shares of common stock. The new warrants represent 200% of the shares issued upon the exercise of the existing warrants and will have an exercise price of $0.31004 per share. The new warrants will become exercisable following required stockholder approval and will have a five-year term.
The inducement agreements also restrict SCWorx from selling additional equity securities until ninety days after the date of stockholder approval. The company has agreed to file a registration statement on Form S-1 to register the resale of shares issuable upon exercise of the new warrants and to use commercially reasonable efforts to have the registration statement declared effective by the SEC within sixty days of stockholder approval, or ninety days if the SEC conducts a full review. If the company fails to meet these requirements, it will be obligated to pay certain liquidated damages to the warrant holders.
The company stated it expects to use the net proceeds from these transactions for working capital and general corporate purposes.
The securities issued in this transaction have not been registered under the Securities Act of 1933 and were issued pursuant to an exemption under Regulation D. The resale of shares issuable upon exercise of the existing warrants has been registered.
This information is based on a press release statement and an SEC filing.
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