ALT5 Sigma Corporation(ALTS) - 2025 Q2 - Quarterly Results

Securities Purchase Agreement Overview This agreement outlines ALT5 Sigma Corporation's private placement offering to raise up to $1.5 billion, including concurrent Registration Rights and Token Purchase Agreements Agreement Parties and Offering The agreement, dated August 11, 2025, details ALT5 Sigma Corporation's private placement to raise up to $1.5 billion, involving specific securities and a concurrent token purchase - The agreement is dated August 11, 2025, between ALT5 Sigma Corporation and the purchasers identified on the signature pages[2] Offering Details | Offering Detail | Value / Description | | :--- | :--- | | Maximum Gross Proceeds | Up to $1.5 billion | | Offering Basis | Commercially reasonable best efforts | | Securities Act Exemption | Section 4(a)(2) and Rule 506(b) of Regulation D | - Contemporaneously with this offering, the parties will execute a Registration Rights Agreement and a Token Purchase Agreement, under which the Company will purchase $WLFI from the Lead Investor[3] - The purchase of securities is intended to be treated as a tax-free exchange under Section 351(a) of the Internal Revenue Code[4] Article I: Definitions This article defines key terms, including the $7.50 per share purchase price, the Lead Investor, and the various securities offered Key Definitions Key terms defined include the $7.50 per share price, World Liberty Financial as Lead Investor, and the various common stock and warrant securities - The "Per Share Purchase Price" for the Common Stock is established at $7.50[37] - The "Lead Investor" is identified as World Liberty Financial, Inc.[30] - The "Securities" being sold include Shares of Common Stock, Pre-Funded Warrants, Lead Investor Warrants, Management Warrants, and the shares issuable upon their exercise[53] - The agreement defines several stablecoins that can be used for payment: USD1 (World Liberty Financial USD coin), USDC (USD Coin), and USDT (Tether)[50][51][52] - The "Placement Agent" for the offering is A.G.P./Alliance Global Partners[39] Article II: Purchase and Sale This article details the closing terms, including share sales, beneficial ownership limits, payment methods, and required deliverables Closing The closing involves selling up to $750 million in shares, with options for Pre-Funded Warrants and payment in cash or specified stablecoins/tokens Transaction Closing Details | Item | Detail | | :--- | :--- | | Aggregate Purchase | Up to ~$750 million of Shares | | Beneficial Ownership Limitation | 4.99% or 9.99% (at Purchaser's election) | | Payment Methods | Cash, USD1, USDT, USDC, or $WLFI | | $WLFI Fixed Exchange Rate | $0.20 per $WLFI token | - Purchasers may elect to purchase Pre-Funded Warrants in lieu of Shares to manage their beneficial ownership percentage[65] Deliveries This section specifies the Company's provision of executed documents and warrants, and Purchasers' delivery of agreements and subscription amounts - Company's deliverables include the executed Agreement, legal opinions, irrevocable instructions to the Transfer Agent, various Warrants (Pre-Funded, Asset Manager, Lead Investor, Management), and other related agreements[66] - Purchasers' deliverables include the executed Agreement, the Registration Rights Agreement, the TPA (from Lead Investor), and the Subscription Amount in the specified form (cash or crypto)[66] Closing Conditions Closing is contingent on accurate representations, covenant fulfillment, and required deliveries, with additional conditions for Purchasers regarding material adverse effects - The Company's obligation to close is subject to the accuracy of Purchasers' representations and their performance of all obligations[67] - The Purchasers' obligation to close is subject to the accuracy of the Company's representations, its performance of obligations, the absence of a Material Adverse Effect, and that the Company's stock has not been suspended from trading[67] Article III: Representations and Warranties This article covers the Company's and Purchasers' assurances regarding corporate status, financial compliance, and investment intent Representations and Warranties of the Company The Company warrants its SEC compliance, non-investment company status, valid securities issuance, and the governance-only utility of $WLFI tokens - The Company represents that its SEC Reports are filed on time, comply with regulations, and do not contain any untrue statements of a material fact[77] - The Company confirms it is not an "investment company" under the Investment Company Act of 1940 and will conduct its business to avoid becoming one[91] - The Company represents that, assuming the accuracy of the Purchasers' representations, the offering is a private placement exempt from registration under the Securities Act[90] - The Company acknowledges that the sole utility of the $WLFI token is for governance participation in the World Liberty Financial Protocol and that it does not confer economic rights or represent an expectation of profits[116] Representations and Warranties of the Purchasers Purchasers confirm their accredited investor status, acquisition for own account, and clear title to any digital assets used for payment - Each Purchaser represents they are an "accredited investor" as defined under the Securities Act[125] - Each Purchaser confirms they are acquiring the Securities for their own account and not as a result of any "general solicitation" or "general advertising"[124][127] - Purchasers paying with digital assets (USD1, USDC, USDT, or $WLFI) represent that they have full rights and title to the assets, which are held in a secure digital wallet under their exclusive control[131] Article IV: Other Agreements of the Parties This article outlines ongoing covenants, including disclosure, equity sales, Lead Investor board rights, and the $WLFI-centric Treasury Reserve Policy Covenants and Post-Closing Obligations Key covenants include public disclosure, use of proceeds for $WLFI acquisition, board nomination rights for Lead Investor, and adoption of a $WLFI-focused Treasury Reserve Policy - The Company is required to issue a press release and file a Form 8-K to publicly disclose the transaction, after which the Purchasers are released from confidentiality obligations[144] - Net proceeds from the sale will be used to acquire $WLFI and establish the company's cryptocurrency treasury operations, managed by an Asset Manager[147] - The Company agrees to seek stockholder approval to increase its authorized shares to ensure sufficient reserves for warrant exercises, with a meeting to be held by September 30, 2025[151] - The Lead Investor obtains the right to nominate two directors to the Company's board (including the Chairman) and to select the Chief Investment Officer[162] - The Company will adopt a "Treasury Reserve Policy" making $WLFI its primary treasury reserve asset, with oversight from a board subcommittee chaired by a Lead Investor director[163] - The parties agree to treat the transaction as a tax-free exchange under Section 351(a) of the IRC, with $WLFI valued at $0.20 per token for tax purposes[165][166] Article V: Miscellaneous This article covers general legal provisions, including termination conditions, expense allocation, governing law, and waiver of jury trial General Provisions Standard clauses include termination rights, expense reimbursement, New York governing law, and a mutual waiver of jury trial for disputes - A Purchaser may terminate their obligation if the Closing has not occurred on or before the seventh Trading Day following the agreement's date[170] - The Company agrees to reimburse the Lead Investor for up to $1,000,000 in costs and expenses related to the transaction[171] - The agreement shall be governed by the internal laws of the State of New York, with legal proceedings to be commenced in New York City courts[178] - All parties knowingly and irrevocably waive their right to a trial by jury in any action, suit, or proceeding related to the agreement[190] Exhibits This section lists the ancillary documents forming part of the agreement, including the Registration Rights Agreement and various warrant forms Attached Exhibits The agreement incorporates key exhibits such as the Registration Rights Agreement, various lock-up agreements, and forms for different warrant types - The agreement references and includes the following key exhibits: * Exhibit A: Registration Rights Agreement * Exhibit B: Form of Management Lock-Up Agreement * Exhibit C: Form of Pre-Funded Warrant * Exhibit D: Form of Lead Investor Warrant * Exhibit E: Form of Management Warrant * Exhibit F: Token Purchase Agreement * Exhibit G: Investor Lock-Up Agreement[196][197][198]