XML 41 R19.htm IDEA: XBRL DOCUMENT v3.24.1
Warrants
 12 Months Ended
Dec. 31, 2023
Guarantees and Product Warranties [Abstract]  
Warrants

Note 11 – Warrants

 

Warrants Issued

 

On November 24, 2023, additional Warrants and the 1,483,560 Warrant Shares were issued in a concurrent private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and have not been registered under the Securities Act, or applicable state securities laws to Dawson James Securities Inc.

 

On June 5, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain accredited and institutional investors (the “Investors”) pursuant to which the Company issued warrants to purchase up to 25,080,000 shares of common stock (the “Warrants”), exercisable at $0.38 per share (the “Offering”) (see Note 9 for further disclosures).

 

On March 9, 2023, the Company received an Investor Notice from Alpha (described above in Note 9) resulting in the issuance of a Common Stock warrant to purchase up to 7,142,715 shares of Common Stock at the exercise price of $0.42 per share warrant (the “Additional Warrant”) for an aggregate purchase price of $3,000,000. The Additional Warrant is exercisable upon issuance and has a three-year term. On March 10, 2023, the Company issued and sold the Additional Series F Preferred along with the associated Additional Warrant. On June 5, 2023, upon entering the Purchase Agreement a Down Round was triggered reducing the exercise price of the Additional Warrant to $0.25.

 

On December 6, 2022, the Company entered into a Promissory Note Purchase Agreement (described above in Note 8), pursuant to which the Company issued the right to purchase up to 5,000,000 shares of Common Stock at an exercise price of $0.44 per share (see Note 8 for further disclosures), subject to standard anti-dilution adjustments. The Promissory Note Warrant was not exercisable for the first six months after issuance and has a five-year term from the initial exercise date of June 6, 2023. On September 15, 2023, the Company and the Investor entered into a Warrant Exchange Agreement pursuant to which the Company has agreed to issue to the Investor 5,000,000 shares of common stock in exchange for the Promissory Note Warrant. The Promissory Note Warrant has since been cancelled and is now no longer outstanding.

 

On June 26, 2022, the Company entered into a Securities Purchase Agreement (described above in Note 8) with Alpha. In connection with the Series F Agreement the Company issued a warrant to Alpha to purchase 16,129,032 shares of Common Stock, par value $0.001 per share Series F Warrant with an exercise price equal to $0.96, subject to adjustment, per share of Common Stock. The Series F Warrants were not exercisable for the first six months after its issuance and have a three-year term from its initial exercise date of December 30, 2022. Upon the issuance of the 5,000,000 shares of Common Stock warrants at $0.44 per share, the Series F Warrant exercise price was reduced to $0.44, the warrants were further reduced in March upon issuance of additional Series F Preferred shares to $0.42 and in June to $0.25 upon entering the Purchase Agreement (see Note 8 for explanation regarding the December, March and June Down Rounds along with any other further disclosures related to Series F Preferred Stock).

 

 

AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 

Note 11 – Warrants – Continued

 

The exercise price of the Warrants and the number of Warrant Shares issuable upon the exercise thereof will be subject to adjustment in the event of any stock dividends and splits, reverse stock split, recapitalization, reorganization or similar transaction, as described in the Warrants, but has no anti-dilution protection provisions. The Warrants will be exercisable on a “cashless” basis only in the event there is no effective registration statement registering, or the prospectus contained therein is not available for the sale of the Warrant Shares. The Warrants contain a beneficial ownership limitation, such that none of such Warrants may be exercised, if, at the time of such exercise, the holder would become the beneficial owner of more than 4.99% or 9.99%, as determined by the holder, of the Company’s outstanding shares of Common Stock following the exercise of such Warrant (the “Beneficial Ownership Limitation”).

 

Warrant Conversions

 

For the twelve months ended December 31, 2023, 5,000,000 warrants were converted to 5,000,000 shares of common stock.

 

A summary of activity related to warrants for the periods presented is as follows:

 

   Shares   Weighted Average Exercise Price   Weighted Average Remaining Contractual Term 
Outstanding as of December 31, 2021   —   $—    — 
Issued   21,129,032    0.29*   — 
Exercised   —    —    — 
Outstanding as of December 31, 2022   21,129,032    0.29*   — 
Issued – March 2023   7,142,715   $0.25*   — 
Issued – June 2023   25,080,000    0.38*   — 
Issued – November 2023   16,319,165    0.12*   — 
Exercised   (5,000,000)   0.44    — 
Outstanding as of December 31, 2023   64,670,912   $0.27*   3.43 
Exercisable as of December 31, 2023   64,670,912    0.27    3.43 

 

*Reflects the exercise price after the Down Round Trigger events (see Note 8).

 

 

AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022