Roadzen Issues Equity & Warrants in Unregistered Sale

TL;DR

**Roadzen just issued new shares and warrants, likely diluting existing stock.**

AI Summary

Roadzen Inc. entered into a material definitive agreement on January 19, 2024, involving the issuance of equity securities and the creation of a direct financial obligation. This filing indicates that the company issued common stock and warrants in an unregistered sale, which could dilute the ownership stake of existing shareholders. For investors, this matters because an increase in the number of shares outstanding can reduce the value of each individual share, potentially impacting stock price.

Why It Matters

This filing signals potential dilution for current shareholders due to the issuance of new common stock and warrants, which could impact the per-share value of their investment.

Risk Assessment

Risk Level: medium — The issuance of unregistered equity securities and warrants carries a medium risk due to potential dilution for existing shareholders.

Analyst Insight

A smart investor would monitor Roadzen Inc.'s stock for potential short-term price volatility and assess the long-term implications of this dilution on their investment thesis.

Key Players & Entities

• Roadzen Inc. (company) — the registrant issuing securities
• January 19, 2024 (date) — date of earliest event reported
• 001-41094 (other) — Commission File Number

Forward-Looking Statements

• The issuance of new equity and warrants will lead to a short-term dip in Roadzen Inc.'s stock price due to dilution concerns. (Roadzen Inc.) — medium confidence, target: 2024-02-19

FAQ

Key Financial Figures

• $0.0001 — registered Ordinary Shares, par value $0.0001 per share RDZN The Nasdaq Stock Mar
• $11.50 — ary share, each at an exercise price of $11.50 per share RDZNW The Nasdaq Stock Ma
• $500,000 — le debenture in the principal amount of $500,000 to Supurna VedBrat (the “VedBrat
• $50 million — ay issue and sell an aggregate of up to $50 million in principal amount of convertible debe
• $400,000 — Private Placement, at which it received $400,000 in proceeds, on December 15, 2023, and
• $10.00 — time at an initial conversion price of $10.00 per Ordinary Share (the “Convers
• $8.50 — Brat Debenture, at an exercise price of $8.50 per share. The Company entered into a s

Filing Documents

• rdzn-20240119.htm (8-K) — 58KB
• rdzn-ex4_1.htm (EX-4.1) — 158KB
• rdzn-ex10_1.htm (EX-10.1) — 90KB
• rdzn-ex10_2.htm (EX-10.2) — 24KB
• 0000950170-24-006964.txt ( ) — 531KB
• rdzn-20240119.xsd (EX-101.SCH) — 50KB
• rdzn-20240119_htm.xml (XML) — 6KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On January 19, 2024, Roadzen Inc. (the “Company”) issued a convertible debenture in the principal amount of $500,000 to Supurna VedBrat (the “VedBrat Debenture”), a director of the Company, for a purchase price equal to the principal amount of the VedBrat Debenture. The VedBrat Debenture was issued pursuant to the terms of a Securities Purchase Agreement, dated as of December 15, 2023 (the “SPA”), among the Company and the investors party thereto from time to time (collectively, the “Investors”). Also on January 19, 2024, Ms. VedBrat became a party to the SPA and entered into a letter agreement with the Company (the “Letter Agreement”) with respect to her investment in the Company pursuant to the VedBrat Debenture. Pursuant to the terms of the SPA, the Company may issue and sell an aggregate of up to $50 million in principal amount of convertible debentures (collectively, including the VedBrat Debenture, the “Debentures”), on a private placement basis (collectively, the “Private Placement”). The Company held an initial closing of the Private Placement, at which it received $400,000 in proceeds, on December 15, 2023, and may sell additional Debentures at additional closings from time to time. The Company expects to use the net proceeds from the Private Placement for working capital and general corporate purposes. The SPA contains certain representations and warranties customary for similar transactions. In addition, the Company has agreed to file, within 30 days of closing, a registration statement with the Securities Exchange Commission to register for resale the ordinary shares, $0.0001 par value per share (the “Ordinary Shares”), issuable upon conversion of the Debentures, subject to certain conditions. The Debentures issued pursuant to the SPA bear interest, in arrears, at a rate of 13% per ann

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities. The information included in Item 1.01 of this Current Report is incorporated by reference into this Item 3.02 of this Current Report to the extent required. The Debentures and the Ordinary Shares issuable upon conversion thereof, as well as the warrants to be issued pursuant to the terms of the Letter Agreement and the Ordinary Shares issuable upon exercise thereof, have been offered and sold pursuant to exemptions from the registration requirements of the Securities Act of 1933, as amended, afforded by Section 4(a)(2) thereof and Rule 506 of Regulation D promulgated thereunder, for the sale of securities not involving a public offering.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits. Exhibit Number Description of Exhibit 4.1 Form of convertible debenture. 10.1 Securities Purchase Agreement, dated as of December 15, 2023, between Roadzen Inc. and the investors party thereto from time to time. 10.2 Letter agreement, dated as of January 19, 2024, between Roadzen Inc. and Supurna VedBrat. 104 Cover page interactive data file (embedded within the Inline XBRL document)

SIGNATURES

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. ROADZEN INC. Date: January 24, 2024 By: /s/ Rohan Malhotra Name: Title: Rohan Malhotra Chief Executive Officer

View Full Filing

View this 8-K filing on SEC EDGAR