Form 8-K for NEOMEDIA TECHNOLOGIES INC
27-Mar-2012
Entry into a Material Definitive Agreement, Financial Statements and Ex
Item 1.01. Entry Into a Material Definitive Agreement
Agreement and Debenture Closing, March 26, 2012
On March 26, 2012, NeoMedia Technologies, Inc., a Delaware corporation (the " Company " ), entered into an Agreement (the " Agreement "), a copy of which is attached hereto as Exhibit 10.1 and incorporated by reference herein, to issue and sell a secured convertible debenture to YA Global Investments, L.P. (the " Buyer ") in the principal amount of $450,000 (the " Debenture "), a copy of which is attached hereto as Exhibit 10.2 and incorporated by reference herein. The closing of the transaction was held on March 26, 2012. In addition to the Debenture, the Company also issued a warrant to the Buyer to purchase 1,000,000 shares of the Company's common stock, par value $0.001 per share (the " Common Stock "), for an exercise price of $0.15 per share (the "Warrant "), a copy of which is incorporated by reference herein and attached hereto as Exhibit 10.3 .
The Debenture shall mature on July 29, 2012 ( the " Maturity Date ") and shall accrue interest at a rate equal to fourteen percent (14%) per annum and such interest shall be paid on the Maturity Date (or sooner as provided in the Debenture) in cash or, provided that certain Equity Conditions are satisfied (as such term is defined in the Debenture ), in shares of Common Stock at the applicable Conversion Price (as defined in the Debenture ). At any time, the Buyer shall be entitled to convert any portion of the outstanding and unpaid principal and accrued interest thereon into fully paid and non-assessable shares of Common Stock at a price equal to the lesser of $0.10 and ninety-five percent (95%) of the lowest volume weighted average price of the Common Stock during the sixty (60) trading days immediately preceding each conversion date.
The Debenture is secured by certain pledges made with respect to the assets of the Company and its subsidiaries as set forth in the Seventeenth Ratification Agreement dated March 26, 2012 (the "Ratification Agreement"), and that certain Security Agreement (the "Security Agreement") and Patent Security Agreement (the "Patent Security Agreement") both dated July 29, 2008, by and among the Company, each of the Company's subsidiaries made a party thereto, and the Buyer. Copies of the Security Agreement and the Patent Security Agreement are incorporated by reference herein and attached by reference hereto as Exhibits 10.4 and 10.5, respectively. The Ratification Agreement is incorporated by reference herein and attached as Exhibit 10.6 hereto.
In connection with the Agreement, the Company also entered into those certain Irrevocable Transfer Agent Instructions (the "ITAI") with the Buyer, an escrow agent and WorldWide Stock Transfer, LLC, the Company's transfer agent, a copy of which is incorporated herein by reference and attached as Exhibit 10.7 hereto.
The Company shall not affect any conversion, and the Buyer shall not have the right to convert any portion of the Debenture to the extent that after giving effect to such conversion, the Buyer (together with the Buyer's affiliates) would beneficially own in excess of 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to such conversion, except for not less than sixty-five (65) days prior written notice from the Buyer.
The Company shall have the right to redeem a portion or all amounts outstanding (subject to certain conditions) in the Debenture via Optional Redemption (as defined in the Debenture) by paying the amount equal to the principal amount being redeemed plus a redemption premium equal to ten percent (10%) of the principal amount being redeemed, and accrued interest.
The foregoing descriptions of the Agreement, Debenture, Warrant, Security Agreement, Patent Security Agreement, Ratification Agreement and ITAI do not purport to be complete and are qualified in their entirety by reference to such documents, which are attached or incorporated by reference as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, 10.6, and 10.7, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits .
EXHIBIT DESCRIPTION LOCATION
Exhibit 10.1 Agreement, dated March 26, 2012, by and Provided Herewith
between the Company and YA Global
Investments, L.P.
Exhibit 10.2 Secured Convertible Debenture, No. Provided Herewith
NEOM-12-3, dated March 26, 2012, issued by
the Company to YA Global Investments, L.P.
Exhibit 10.3 Warrant, No. NEOM-0312, dated March 26, Provided Herewith
2012, issued by the Company to YA Global
Investments, L.P.
Exhibit 10.4 Security Agreement, dated July 29, 2008, by Incorporated by
and among the Company, each of the Company's reference to Exhibit
subsidiaries made a party thereto and YA 10.3 in the Company's
Global Investments, L.P. Current Report on Form
8-K as filed with the
SEC on August 4, 2008
Exhibit 10.5 Patent Security Agreement, dated July 29, Incorporated by
2008, by and among the Company, each of the reference to Exhibit
Company's subsidiaries made a party thereto 10.4 in the Company's
and YA Global Investments, L.P. Current Report on Form
8-K as filed with the
SEC on August 4, 2008
Exhibit 10.6 Seventeenth Ratification Agreement, dated Provided Herewith
March 26, 2012, by and among the Company,
each of the Company's subsidiaries made a
party thereto, and YA Global Investments,
L.P.
Exhibit 10.7 Irrevocable Transfer Agent Instructions, Provided Herewith
dated March 26, 2012, by and among the
Company, the Buyer, David Gonzalez, Esq. and
WorldWide Stock Transfer, LLC
