0000934549FALSE00009345492022-08-242022-08-24
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
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 24, 2022
ACACIA RESEARCH CORPORATION
(Exact name of registrant as specified in its charter)
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| Delaware | 001-37721 | 95-4405754 |
(State or other jurisdiction of
incorporation) | (Commission
File Number) | (I.R.S. Employer
Identification No.) |
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| 767 Third Avenue, | |
| 6th Floor | |
| New York, | |
| NY | 10017
|
| (Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code): (949) 480-8300
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:
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| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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| o | 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:
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| Title of each class | Trading Symbol | Name of each exchange on which registered |
| Common Stock, par value $0.001 per share | ACTG | The Nasdaq Stock Market, LLC |
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.
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| Item 1.01. | | Entry into a Material Definitive Agreement.
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On November 18, 2019, Acacia Research Corporation, a Delaware corporation (the “Company”), entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Starboard Value LP (“Starboard”) and the Buyers (as defined in the Purchase Agreement), pursuant to which, among other things, the Company and Starboard established a strategic and ongoing relationship including the terms of Starboard’s initial capital commitment in the Company.
The Company’s Board of Directors recently formed a Special Committee of directors not affiliated or associated with Starboard to review the Starboard relationship with the objective of establishing a simplified capital structure with increased capital resources for the next phase of the Company’s growth. The Special Committee has retained both independent financial and legal advisors to assist with its evaluation and negotiation and the Special Committee and Starboard have been working together to reach a resolution to these matters.
In connection with these negotiations, the Special Committee determined that it would be in the best interest of the Company to amend the Series B Warrants (described below) to extend the Cash Exercise Date (defined below) for three weeks from August 25, 2022 to September 15, 2022 (the “Warrant Amendment”) to allow for adequate time to reach a resolution with Starboard. The Company entered into the Warrant Amendment on August 24, 2022.
Under the terms of the Purchase Agreement, the Company has issued Series B Warrants to purchase up to 100 million shares of the Company’s common stock to the Buyers at an exercise price (subject to certain price-based anti-dilution adjustments) of either (i) $5.25 per share, if exercising by cash payment, within 30 months from the issuance date (the “Cash Exercise Date”); or (ii) $3.65 per share, if exercising by cancellation of a portion of certain senior secured notes (the “Notes”), issued by the Company.
The Series B Warrants were amended in connection with the issuance of $115.0 million in Notes to the Buyers to permit the payment of the lower exercise price of $3.65 through the payment of cash, rather than only through the cancellation of Notes outstanding, at any time until the expiration of the Series B Warrants on November 15, 2027. 31,506,849 of the Series B Warrants were subject to this adjustment with the remaining balance of 68,493,151 Series B Warrants continuing under their original terms.
The foregoing description of the Warrant Amendment is a summary of the material terms of such amendment, does not purport to be complete, and is qualified in its entirety by reference to the Warrant Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference herein.
Item 9.01.Financial Statements and Exhibits.
(d)Exhibits
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| Exhibit No. | | Description of Exhibit |
| 10.1 | | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Dated: August 24, 2022 | |
| ACACIA RESEARCH CORPORATION |
| |
| By: | /s/Clifford Press |
| Name: | Clifford Press |
| Title: | Chief Executive Officer |
AMENDMENT
TO
SERIES B WARRANT TO PURCHASE COMMON STOCK
This AMENDMENT TO SERIES B WARRANT TO PURCHASE COMMON STOCK, dated as of August 24, 2022 (this “Amendment”), is made by and between Acacia Research Corporation, a Delaware corporation (the “Company”) and Starboard Value LP (the “Designee”) on behalf of itself and on behalf of the funds and accounts under its management that as of the date hereof hold (each, a “Warrantholder” and collectively, the “Warrantholders”) the Series B Warrants to purchase common stock issued by the Company listed on Exhibit A (each, a “Series B Warrant” and collectively, the “Series B Warrants”). Capitalized terms used but not specifically defined herein shall have the meanings ascribed to such terms in the Series B Warrants.
WHEREAS, the Company and the Warrantholders are parties to the Series B Warrants;
WHEREAS, the Company, the Designee and certain Starboard Funds have entered into, among others, that certain Securities Purchase Agreement, dated as of November 18, 2019 (the “Securities Purchase Agreement”);
WHEREAS, pursuant to Section 9 of the Series B Warrants, the Series B Warrants may be amended if the Company has obtained the written consent of the Required Holders and any amendment by the Company and the Required Holders shall be binding on the holder of such Series B Warrant and all holders of the other SPA Warrants;
WHEREAS, the Company and the Designee are negotiating a potential exchange of warrants and other securities held by funds and accounts under the Designee’s management and wish to delay the Cash Exercise Expiration Date (as defined in each Series B Warrant) as described below until such negotiations have concluded;
WHEREAS, each of the Company and the Designee hereby agree to amend the Series B Warrants as described below; and
NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.The Designee hereby represents and warrants to the Company that it satisfies the definition of “Required Holder” for all purposes under the Series B Warrants.
2.Effective as of the date hereof, the definition of Cash Exercise Expiration Date set forth in Section 1(b) of each Series B Warrant is hereby amended as follows:
“Cash Exercise Expiration Date" means (i) as to a Limited Cash Exercise, the Expiration Date (i.e., November 15, 2027), and (ii) otherwise, September 15, 2022.”
3.Except as expressly modified hereby, all terms, conditions and provisions of the Series B Warrants will continue in full force and effect. Each reference in the Series B Warrants to “this Warrant,” “hereunder,” “hereof,” “herein” or words of similar import referring to the Series B Warrants shall mean and be a reference to the Series B Warrants as amended by this Amendment. All references in the Series B Warrants to “the date hereof”, “the date of this Warrant” or similar references shall refer to February 25, 2020.
4.Each Series B Warrant, as modified by this Amendment, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, that may have been made or entered into by or among any of the parties hereto or any of their respective affiliates relating to the Series B Warrant.
5.Sections 8 (Notices), 9 (Amendment and Waiver), 10 (Governing Law; Jurisdiction; Jury Trial), 11 (Construction; Headings), 12 (Dispute Resolution), 13 (Remedies, Other Obligations, Breaches and Injunctive Relief), 14 (Transfer), 15 (Severability), 16 (Disclosure) and 17 (Payment of Collection, Enforcement and Other Costs) of each Series B Warrant are incorporated by reference herein, mutatis mutandis.
[The remainder of this page is intentionally left blank.]
IN WITNESS WHEREOF, the parties have duly executed this Amendment as of the date first above written.
ACACIA RESEARCH CORPORATION
By
Name: Clifford Press
Title: Chief Executive Officer
STARBOARD VALUE LP
By
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| Name: | Jeffrey Smith |
| Title: | Chief Executive Officer & Chief Investment Officer |
[Signature Page to First Amendment to Series B Warrant to Purchase Common Stock]
Exhibit A
1.Series B Warrant to Purchase Common Stock issued to Starboard Value and Opportunity Master Fund Ltd, dated of issuance February 25, 2020, for 54,068,052 shares of common stock (Warrant No. B-10).
2.Series B Warrant to Purchase Common Stock issued to Starboard X Master Fund Ltd., dated of issuance February 25, 2020, for 7,631,948 shares of common stock (Warrant No. B-11).
3.Series B Warrant to Purchase Common Stock issued to Starboard Value and Opportunity S LLC, dated of issuance February 25, 2020, for 10,000,000 shares of common stock (Warrant No. B-12).
4.Series B Warrant to Purchase Common Stock issued to Starboard Value and Opportunity C LP, dated of issuance February 25, 2020, for 5,800,000 shares of common stock (Warrant No. B-13).
5.Series B Warrant to Purchase Common Stock issued to Starboard Value and Opportunity Master Fund L LP, dated of issuance February 25, 2020, for 5,500,000 shares of common stock (Warrant No. B-14).
6.Series B Warrant to Purchase Common Stock issued to an account managed by Starboard Value LP, dated of issuance February 25, 2020, for 17,000,000 shares of common stock (Warrant No. B-15).