UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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): July 26, 2018

 

 

Superconductor Technologies Inc.

(Exact Name of Registrant as Specified in Charter)

 

 

 

Delaware   0-21074   77-0158076

(State or Other Jurisdiction

of Incorporation)

 

Commission

File Number

 

(IRS Employer

Identification No.)

 

9101 Wall Street, Suite 1300, Austin, TX   78754
(Address of Principal Executive Offices)   (Zip Code)

Registrant’s telephone number, including area code: (512) 334-8900

N/A

(Former name or former address, if changed since last report)

 

 

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 ( see General Instruction A.2. below):

 

☐

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))

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.  ☐

 

 

 

Item 1.01

Entry into a Material Definitive Agreement

Equity Financing

On July 26, 2018, Superconductor Technologies Inc. (the “Company”), announced the pricing of a public offering of 2,571,429 shares of common stock (and common stock equivalents) at a public offering price of $3.50 per share of common stock (or common stock equivalent). The closing of the registered public offering occurred on July 30, 2018.

In connection with the offering, the Company issued 1,390,000 shares of its common stock at a price of $3.50 per share, with each share of common stock coupled with a five year warrant to purchase one share of common stock, at an exercise price of $3.50 (the “Warrants”). These securities were offered in the form of a Class A Unit but were immediately separable and were issued separately at the closing.

For certain investors who would otherwise hold more than 4.99% (or at the election of a purchaser, 9.99%) of the Company’s common stock following the registered offering, the Company issued to such investors an aggregate of 4,135.0015 Class B Units (equivalent to 1,181,429 shares of its common stock), consisting of shares of a new class of preferred stock designated Series E Convertible Preferred Stock (as outlined below) (the “Series E Preferred Stock”) with a stated value of $1,000 and which are convertible into the Company’s common stock at a conversion price equal to $3.50 per share of common stock, together with an equivalent number of Warrants in the same form and economic terms based on the related purchase price as the purchasers of the Class A Units (the “Class B Units” and together with the “Class A Units”, the “Units”). These securities offered in the form of a Class B Unit were immediately separable and were issued separately at the closing.

The rights and obligations associated with Class A Units and Class B Units consist only in the constituent parts of each such unit, except that the Company approved the sale of the constituent parts as units on the terms and conditions described in the prospectus filed in the Registration Statement (as defined below).

In connection with the offering, the Company entered into a Securities Purchase Agreement (“Purchase Agreement”) with certain of the investors in the offering purchasing the Class B Units and engaged H.C. Wainwright & Co. (the “Placement Agent”) to act as placement agent. The Company agreed to pay the Placement Agent a cash placement fee equal to 7% of the gross proceeds from the sales of the Units sold in the registered offering, a management fee equal to 1% of the gross proceeds of the registered offering, reimbursement of $100,000 for the Placement Agent’s legal fees and expenses, and a non-accountable expense allowance up to $25,000. The Company also granted the Placement Agent a right of first refusal to act as its exclusive advisor, manager or underwriter or agent, as applicable, if the Company or its subsidiaries sells or acquires a business, finances any indebtedness using an agent, or raises capital through a public or private offering of equity or debt securities at any time prior to the twelve month anniversary of the date of commencement of sales in the offering.

In addition, the Company agreed to issue to the Placement Agent warrants (the “Placement Agent Warrants”) to purchase up to 154,286 common shares, which represents 6.0% of the aggregate number of common stock and common stock equivalents sold in the offering. The Placement Agent warrants will have a termination date of July 25, 2023 and an exercise price per share equal to $4.375, or 125% of the public offering price for the Class A Units sold in the offering. The Placement Agent Warrants are subject to a six month lock-up, subject to certain limited exceptions, in accordance with Financial Industry Regulatory Authority Rule 5110(g).

The net proceeds to the Company from the offering, after deducting the Placement Agent’s fees and expenses, the Company’s estimated offering expenses, and excluding the proceeds, if any, from the exercise of the Warrants issued in the offering, are expected to be approximately $7.98 million. The Company intends to use the net proceeds of the offering for working capital and general corporate purposes, which may include acquiring complementary products, technologies or businesses.

A registration statement, as amended, relating to these securities (File No. 333-226025) was declared effective on July 25, 2018 (the “Registration Statement”). The offering was made only by means of a prospectus forming a part of the effective Registration Statement.

On July 26, 2018, the Company issued a press release announcing the pricing of the registered offering. A copy of the press release is filed as Exhibit 99.1 hereto and is incorporated herein by reference.

On July 30, 2018, the Company issued a press release announcing the completion of the registered offering. A copy of the press release is filed as Exhibit 99.2 hereto and is incorporated herein by reference.

The foregoing summaries of the Purchase Agreement, Warrants, and Placement Agent Warrants are subject to, and qualified in their entirety by, such documents included as Exhibits 4.26, 4.27 and 4.28 to the Registration Statement, respectively, which are incorporated herein by reference. Certain of these documents contain representations and warranties and other statements which are not for the benefit of any party other than the parties to such document or agreement and are not intended as a document for investors (to the extent they are not a party to such agreement) or the public generally to obtain factual information about us.

Adjustment of Exercise Price of other Warrants

As a result of the registered offering described above, the exercise price of the Term A warrants issued in the Company’s underwritten public offering that closed on August 9, 2013, will each be adjusted to $3.50 per share due to the price-based anti-dilution adjustment mechanisms in such warrants. This adjustment mechanism provides that if the Company sells shares of common stock or common stock equivalents at an effective per share price less than the then exercise price of such warrants, that the exercise price of the Term A warrants will be reset to such lower price. This feature will terminate when the volume-weighted average price of the Company’s common stock as reported by its principal trading market exceeds 300% of the then exercise price of the warrant for thirty consecutive trading days and does not apply to certain exempt issuances, including, in certain circumstances, issuances under equity incentive plans, securities issued upon exercise or conversion of existing securities or securities issued in connection with acquisitions or strategic transactions. Each Term A warrant expires on August 9, 2018.

 

Item 5.03

Amendment to Articles of Incorporation or Bylaws

The information contained above in Item 1.01 is hereby incorporated by reference into this Item 5.03. On July 27, 2018, and in connection with the anticipated issuance of the Series E Preferred Stock in the offering, the Company filed a Certificate of Designation to its Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, authorizing and establishing the rights, preferences, and privileges of the Series E Convertible Preferred Stock. Copies of the form of stock certificate and Certificate of Designation relating to the Series E Convertible Preferred Stock are included as Exhibits 4.5 and 4.10 to the Registration Statement, respectively, which are incorporated herein by reference.

Forward-Looking Statements

Certain statements in this Form 8-K are forward-looking statements that involve a number of risks and uncertainties. For such statements, the Company claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from the Company’s expectations. Factors that could cause actual results to differ materially from those stated or implied by the Company’s forward-looking statements are disclosed in the Company’s other reports filed with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Readers are cautioned not to place undue reliance upon these forward-looking statements, which speak only as to the date of this report. Except as required by law, the Company undertakes no obligation to update any forward-looking or other statements in this report, whether as a result of new information, future events or otherwise.

Item 9.01

Financial Statements and Exhibits

(d) Exhibits

 

            99.1    Press Release of the Company dated July 26, 2018.
            99.2    Press Release of the Company dated July 30, 2018.

SIGNATURES

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 thereunto duly authorized.

 

    Superconductor Technologies Inc.
Dated: July 30, 2018     By:   /s/ WILLIAM J. BUCHANAN
      William J. Buchanan
      Vice President and Chief Financial Officer

Exhibit 99.1

Superconductor Technologies Announces Pricing of $9 Million Public Offering

AUSTIN, Texas, July 26, 2018 (GLOBE NEWSWIRE) — Superconductor Technologies Inc. (NASDAQ:SCON) (the “Company”), a leading company in developing and commercializing high temperature superconductor (“HTS”) materials and related technologies, announced today the pricing of a public offering of an aggregate of 2,571,429 shares of common stock (or common stock equivalents) and warrants to purchase an aggregate of 2,571,429 shares of common stock, with expected total gross proceeds of approximately $9 million. The offering is expected to close on or about July 30, 2018, subject to satisfaction of customary closing conditions.

H.C. Wainwright & Co. is acting as exclusive placement agent for the offering.

The offering was priced at $3.50 per share of common stock (or common stock equivalent) and related warrant, with each share of common stock (or common stock equivalent) sold with one five-year warrant to purchase one share of common stock, at an exercise price of $3.50 per share.

The Company intends to use the net proceeds of the offering for working capital and general corporate purposes, which may include acquiring complementary products, technologies or businesses.

The securities are being offered pursuant to a registration statement on Form S-1 (File No. 333-226025) previously filed with the Securities and Exchange Commission (the “SEC”) and declared effective on July 25, 2018. The securities may be offered only by means of a prospectus. The preliminary prospectus related to the offering has been filed with the SEC and a final prospectus related to the offering will be filed with the SEC. Copies of the preliminary prospectus and the final prospectus, when available, may be obtained at the SEC’s website located at http://www.sec.gov, and may also be obtained from H.C. Wainwright & Co., LLC, 430 Park Avenue, 3rd Floor, New York, NY 10022, by calling (646) 975-6996 or emailing placements@hcwco.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor may there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Superconductor Technologies Inc. (STI)

Superconductor Technologies Inc. is a global leader in superconducting innovation. Its Conductus ®  superconducting wire platform offers high performance, cost-effective and scalable superconducting wire. With 100 times the current carrying capacity of conventional copper and aluminum, superconducting wire offers zero resistance with extreme high current density. This provides a significant benefit for electric power transmission and also enables much smaller or more powerful magnets for motors, generators, energy storage and medical equipment. Since 1987, STI has led innovation in HTS materials, developing more than 100 patents as well as proprietary trade secrets and manufacturing expertise. For more than 20 years STI utilized its unique HTS manufacturing process for solutions to

maximize capacity utilization and coverage for Tier 1 telecommunications operators. Headquartered in Austin, TX, Superconductor Technologies Inc.’s common stock is listed on the NASDAQ Capital Market under the ticker symbol “SCON.” For more information about STI, please visit http://www.suptech.com.

Safe Harbor Statement

Statements in this press release regarding our business and the offering described above that are not historical facts are “forward-looking statements” that involve risks and uncertainties. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors, which could cause actual results to differ materially from the forward-looking statements. These factors and uncertainties include, but are not limited to: our expectation regarding the closing of the offering, our limited cash and a history of losses; our need to materially grow our revenues from commercial operations and/or to raise additional capital (which financing may not be available on acceptable terms or at all) in the very near future, before cash reserves are depleted (which reserves, prior to the closing of the offering described above, are expected to be sufficient through the third quarter of 2018), to implement our current business plan and maintain our viability; the performance and use of our equipment to produce wire in accordance with our timetable; overcoming technical challenges in attaining milestones to develop and manufacture commercial lengths of our HTS wire; the possibility of delays in customer evaluation and acceptance of our HTS wire; the limited number of potential customers and customer pressures on the selling prices of our products; the limited number of suppliers for some of our components and our HTS wire; there being no significant backlog from quarter to quarter; our market being characterized by rapidly advancing technology; the impact of competitive products, technologies and pricing; manufacturing capacity constraints and difficulties; the impact of any financing activity on the level of our stock price; the dilutive impact of any issuances of securities to raise capital; the steps required to maintain the listing of our common stock with a U.S. national securities exchange and the impact on the liquidity and trading price of our common stock if we fail to maintain such listing; the cost and uncertainty from compliance with environmental regulations; and local, regional, and national and international economic conditions and events and the impact they may have on us and our customers.

Forward-looking statements can be affected by many other factors, including, general market conditions, the use of proceeds from the sale of the securities being offered, those described in the “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, in the “Risk Factors” section of the Company’s registration statement on Form S-1 (File No. 333-226025), and other public filings. These documents are available online at the Company’s website, www.suptech.com, or through the SEC’s website, www.sec.gov. For forward-looking statements in this press release, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on information presently available to senior management, and the Company has not assumed any duty to update any forward-looking statements.

Investor Relations Contact

Moriah Shilton or Kirsten Chapman

LHA         +1-415-433-3777                invest@suptech.com

LOGO

Superconductor Technologies Inc.

Exhibit 99.2

Superconductor Technologies Announces Closing of $9 Million Public Offering

AUSTIN, Texas, July 30, 2018 — Superconductor Technologies Inc. (NASDAQ: SCON) (the “Company”), a leading company in developing and commercializing high temperature superconductor (“HTS”) materials and related technologies, announced today the completion of its previously announced public offering of an aggregate of 2,571,429 shares of common stock (or common stock equivalents) and warrants to purchase an aggregate of up to 2,571,429 shares of common stock for total gross proceeds of approximately $9 million.

The offering was priced at $3.50 per share of common stock (or common stock equivalent) and related warrant, with each share of common stock (or common stock equivalent) sold with one five-year warrant to purchase one share of common stock, at an exercise price of $3.50 per share.

The Company intends to use the net proceeds of the offering for working capital and general corporate purposes, which may include acquiring complementary products, technologies or businesses.

H.C. Wainwright & Co. acted as exclusive placement agent for the offering.

The securities were offered pursuant to a registration statement on Form S-1, as amended (File No. 333-226025) previously filed with the Securities and Exchange Commission (the “SEC”) and declared effective on July 25, 2018. The securities may be offered only by means of a prospectus forming part of the effective registration statement. The final prospectus related to the offering, as supplemented, was filed with the SEC on July 30, 2018. Copies of the final prospectus, as supplemented, may be obtained for free at the SEC’s website located at http://www.sec.gov, and may also be obtained from H.C. Wainwright & Co., LLC, 430 Park Avenue, 3rd Floor, New York, NY 10022, by calling (646) 975-6996 or emailing placements@hcwco.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor may there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Superconductor Technologies Inc. (STI)

Superconductor Technologies Inc. is a global leader in superconducting innovation. Its Conductus ®  superconducting wire platform offers high performance, cost-effective and scalable superconducting wire. With 100 times the current carrying capacity of conventional copper and aluminum, superconducting wire offers zero resistance with extreme high current density. This provides a significant benefit for electric power transmission and also enables much smaller or more powerful magnets for motors, generators, energy storage and medical equipment. Since 1987, STI has led innovation in HTS materials, developing more than 100 patents as well as proprietary trade secrets and manufacturing expertise. For more than 20 years STI utilized its unique HTS manufacturing process for solutions to maximize capacity utilization and coverage for Tier 1 telecommunications operators. Headquartered in Austin, TX, Superconductor Technologies Inc.’s common stock is listed on the NASDAQ Capital Market under the ticker symbol “SCON.” For more information about STI, please visit  http://www.suptech.com .

Safe Harbor Statement

Statements in this press release regarding our business and the offering described above that are not historical facts are “forward-looking statements” that involve risks and uncertainties. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors, which could cause actual results to differ materially from the forward-looking statements. These factors and uncertainties include, but are not limited to: our limited cash and a history of losses; our need to materially grow our revenues from commercial operations and/or to raise additional capital (which financing may not be available on acceptable terms or at all), to implement our current business plan and maintain our viability; the performance and use of our equipment to produce wire in accordance with our timetable; overcoming technical challenges in attaining milestones to develop and manufacture commercial lengths of our HTS wire; the possibility of delays in customer evaluation and acceptance of our HTS wire; the limited number of potential customers and customer pressures on the selling prices of our products; the limited number of suppliers for some of our components and our HTS wire; there being no significant backlog from quarter to quarter; our market being characterized by rapidly advancing technology; the impact of competitive products, technologies and pricing; manufacturing capacity constraints and difficulties; the impact of any financing activity on the level of our stock price; the dilutive impact of any issuances of securities to raise capital; the steps required to maintain the listing of our common stock with a U.S. national securities exchange and the impact on the liquidity and trading price of our common stock if we fail to maintain such listing; the cost and uncertainty from compliance with environmental regulations; and local, regional, and national and international economic conditions and events and the impact they may have on us and our customers.

Forward-looking statements can be affected by many other factors, including, general market conditions, the use of proceeds from the sale of the securities being offered, those described in the “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, in the “Risk Factors” section of the Company’s registration statement on Form S-1, as amended (File No. 333-226025), and other public filings. These documents are available online at the Company’s website, www.suptech.com, or through the SEC’s website, www.sec.gov. For forward-looking statements in this press release, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on information presently available to senior management, and the Company has not assumed any duty to update any forward-looking statements.

Investor Relations Contact

Cathy Mattison or Kirsten Chapman

LHA

+1-415-433-3777

invest@suptech.com