Smith Micro to sell 3.32M shares at $1.17 in registered direct offering

Smith Micro announced that it has entered into definitive agreements with respect to two separate offerings; a registered offering with certain institutional and accredited investors, and an unregistered offering with the company’s chief executive officer. Both offerings have been priced based on the market value of the offered securities as of the time of signing the purchase agreements. The aggregate gross proceeds of the two offerings are expected to be approximately $6.9M, which includes a committed investment of $3M from the company’s chief executive officer. The company and certain investors have entered into a definitive agreement for the issuance of an aggregate of 3,321,881 registered shares of the company’s common stock at a price of $1.165 per share. Each warrant will be exercisable for one share of common stock at an exercise price of $1.04 per share. The warrants will become exercisable six months after they are issued and will expire five years thereafter. The registered offering will result in gross proceeds to the company of approximately $3.9M prior to offering expenses. The registered offering is expected close on October 2, subject to customary closing conditions. In addition, the company concurrently entered into a definitive purchase agreement for an investment in company securities by the company’s chief executive officer, to be completed pursuant to the private placement of 2,575,107 unregistered shares of the company’s common stock at a purchase price of $1.165 per share, which represents the market value of the securities as of the signing of the definitive purchase agreement for the transaction. Each warrant issued as part of the Private Placement transaction will be exercisable for one share of common stock at an exercise price of $1.04 per share, will become exercisable six months after it is issued and will expire five years thereafter; provided, however, that the warrants will not be exercisable if such exercise would cause the holder’s ownership of company common stock to exceed 19.99%, unless and until the transaction is approved by company stockholders in accordance with Nasdaq Listing Rule 5635(b). The private placement transaction is expected to result in aggregate gross proceeds to the company of approximately $3M. The private placement transaction is expected close on October 2.