Attached files
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| EX-99.1 - PRESS RELEASE - Liberated Syndication Inc. | lysn_ex99-1.htm |
| EX-10.1 - STOCK PURCHASE AGREEMENT - Liberated Syndication Inc. | lysn_ex10-1.htm |
| EX-2.1 - MEMBERSHIP INTEREST PURCHASE AGREEMENT - Liberated Syndication Inc. | lysn_ex2-1.htm |
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): March 29,
2020
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Liberated Syndication Inc.
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(Exact name of registrant as specified in its charter)
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Nevada
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000-55779
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47-5224851
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(State or other jurisdiction
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(Commission
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(I.R.S. Employer
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of incorporation)
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File Number)
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Identification No.)
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5001 Baum Boulevard, Suite 770, Pittsburgh, PA 15213
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(Address of principal executive offices) (Zip Code)
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(412) 621-0902
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(Registrant’s telephone number, including area code)
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(Former name or former address, if changed since last
report)
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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:
☐ 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))
Securities registered pursuant to Section 12(b) of the
Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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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.
AdvertiseCast Membership Interest Purchase Agreement
On March 29, 2021, Liberated Syndication Inc., a Nevada corporation
(the “Company”)
entered into a Membership Interest Purchase Agreement (the
“MIPA”),
by and among the Company, AdvertiseCast, LLC, a Wisconsin limited
liability company (“AdvertiseCast”),
the members of AdvertiseCast (the “Members”),
Dave Hanley, and Trevr Smithlin, as Member Representative (the
“Member
Representative”), under
which the Company agreed to acquire all of the issued and
outstanding equity interests in AdvertiseCast (the
“Acquisition”).
The consideration for the Acquisition will be paid in a combination
of cash and Company common stock, par value $0.001 per share (the
“Common
Stock”). On the closing
date, subject to the terms and conditions of the MIPA, the Company
will (i) pay the Members $18.0 million in cash, subject to
customary purchase price adjustments, and (ii) issue shares of the
Common Stock to the Members having a value equivalent to $10
million dollars, subject certain adjustments. Furthermore, the
Members and an employee trust may earn up to an additional $2.0
million as a revenue-based earn out.
The MIPA contains customary representations, warranties, covenants
and indemnities by the parties to such agreement and is subject to
customary closing conditions, including, among other things, (i)
the receipt of any regulatory approvals, (ii) the accuracy of the
respective parties’ representations and warranties, subject
to customary qualifications, (iii) material compliance by the
parties with their respective covenants and obligations, and (iv)
the Company and the Members entering into a registration rights
agreement. In addition, the MIPA contains certain termination
rights, including by the Company or the Member Representative in
the event the closing has not occurred by May 31,
2021.
Securities Purchase Agreement
On March 29, 2021, the Company entered into a Stock Purchase
Agreement (the “SPA”) between the Company and certain
Purchasers named therein pursuant to which the Company agreed to
sell to the Purchasers, in a private placement (the
“Private
Placement”) pursuant to
Section 4(a)(2) and Regulation D under the Securities Act of 1933,
as amended (the “Securities
Act”), 6,663,338 shares
of Common Stock. At the closing, the Company will receive gross
proceeds of $24,875,000. The Company has agreed to provide
customary indemnification to the Purchasers and their affiliates.
The closing of the Private Placement is subject to customary
conditions, including the entry by the Company and the Purchasers
into a registration rights agreement and closing of the
transactions contemplated by the MIPA. In addition, the SPA has
certain termination rights, including by each Purchaser if the
closing has not occurred by May 31, 2021 and automatically if the
MIPA terminates.
The summaries of the MIPA and SPA in this Current Report on Form
8-K are qualified by reference to the full text of the MIPA and
SPA, respectively, which are included as Exhibits 2.1 and 10.1 to
this Current Report on Form 8-K and incorporated herein by
reference.
The MIPA and SPA have been attached as an exhibit to this report to
provide investors and security holders with information regarding
their terms. It is not intended to provide any other information
about the Company, AdvertiseCast or their respective subsidiaries
and affiliates. The representations, warranties and covenants
contained in the MIPA and SPA were made only for purposes of such
agreements and as of specific dates, are solely for the benefit of
the parties to the MIPA and SPA, respectively, may be subject to
limitations agreed upon by the respective parties, including being
qualified by confidential disclosures made for the purposes of
allocating contractual risk between the parties to the MIPA and
SPA, respectively, instead of establishing these matters as facts,
and may be subject to standards of materiality applicable to the
parties that differ from those applicable to investors. Investors
should not rely on the representations, warranties or covenants or
any description thereof as characterizations of the actual state of
facts or condition of the Company, AdvertiseCast or any of their
respective subsidiaries or affiliates. Moreover, information
concerning the subject matter of the representations, warranties
and covenants may change after the respective dates of the MIPA and
SPA, which subsequent information may or may not be fully reflected
in public disclosures by the Company, AdvertiseCast or their
subsidiaries or affiliates.
Item 3.02 Unregistered Sales of Equity Securities.
The information provided in Item 1.01 of this Current Report on
Form 8-K is incorporated by reference in this Item 3.02. The Common
Stock was offered and sold in reliance upon exemptions from
registration pursuant to Section 4(a)(2) of the Securities Act and
Rule 506 of Regulation D promulgated thereunder.
Forward-Looking Statements
This communication may contain certain “forward-looking
statements” within the meaning of Section 27A of the
Securities Act, Section 21E of the Securities Exchange Act of 1934,
as amended (the “Exchange
Act”), and the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by words such as “expect,”
“anticipate,” “believe,”
“intend,” “estimate,” “plan,”
“target,” “goal,” or similar expressions,
or future or conditional verbs such as “will,”
“may,” “might,” “should,”
“would,” “could,” or similar variations.
These statements are based on the beliefs and assumptions of the
management of the Company based on information currently available
to management. Such forward-looking statements include, but are not
limited to, certain plans, expectations, goals, projections, and
statements about the benefits of the transactions. Such
forward-looking statements are subject to risks, uncertainties and
other factors that could cause actual results to differ materially
from future results expressed or implied by such forward-looking
statements. While there is no assurance that any list of risks and
uncertainties or risk factors is complete, below are certain
factors which could cause actual results to differ materially from
those contained or implied in the forward-looking statements
including: risks related to the Acquisition and Private Placement
and the integration of AdvertiseCast; the financial performance of
AdvertiseCast; the possibility that the transactions do not close
when expected or at all because required regulatory or other
approvals are not received or other conditions to closing are not
satisfied on a timely basis or at all; potential adverse reactions
or changes to business or employee relationships, including those
resulting from the completion of the Acquisition; the possibility
that the anticipated operating results and other benefits of the
Acquisition are not realized when expected or at all; and other
risks described in the section entitled “Risk Factors”
under Item 1A in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2019 and in subsequent periodic and
current Securities and Exchange Commission filings the Company may
make. The Company disclaims any obligation to revise or update any
forward-looking statement that may be made from time to time by it
or on its behalf.
Item 7.01 Regulation FD Disclosure.
Attached as Exhibit 99.1 is a press release issued by the Company
on March 31, 2021 announcing its entry into MIPA and the
SPA.
The information under Item 7.01 (including Exhibit 99.1) is
furnished pursuant to Item 7.01 and shall not be deemed filed for
purposes of Section 18 of the Exchange Act or incorporated by
reference into any filing under the Securities Act or the Exchange
Act, except as shall be expressly set forth by specific reference
in such filing.
Item 8.01 Other Events.
As disclosed in its Current Report on Form 8-K filed on March 17,
2021, the Company determined that it had incorrectly reported the
personal income related to its restricted stock vesting events in
2017, 2018, and 2019. The Company is in the process of estimating
the anticipated penalties and interest liability assessments
related to this error. In addition, as previously disclosed on
March 17, 2021, the Company is reviewing its value added tax (VAT),
general sales taxes (GST), and similar tax returns for the years
2015-2020. The Company is unable to complete assessments for prior
years until it completes its estimates of taxes, penalties, and
interest liabilities for those years. Therefore, the Company
anticipates that its Annual Report on Form 10-K for the year ended
December 31, 2020 will be filed more than 45 days after its due
date.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Number
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Description
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2.1*
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Membership Interest Purchase Agreement, dated March 29, 2021, by
and among Liberated Syndication Inc., AdvertiseCast, LLC, the
members of AdvertiseCast, LLC, Dave Hanley, and Trevr Smithlin, as
Member Representative.
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10.1*
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Stock Purchase Agreement, dated March 29, 2021, by and among
Liberated Syndication Inc. and the purchasers set forth
therein.
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99.1
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Press Release, dated March 31, 2021.
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* Schedules and exhibits have been omitted pursuant to Item
601(a)(5) of Regulation S-K. The Company hereby undertakes to
furnish supplementally a copy of any of the omitted schedules and
exhibits to the Securities and Exchange Commission upon its
request.
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 hereunto duly authorized.
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LIBERATED SYNDICATION INC.
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Date: March 31, 2021
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By:
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/s/ Richard P. Heyse
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Name: Richard P. Heyse
Title: Chief Financial Officer
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