Reborn Coffee (REBN) Enters Material Agreement, Sells Unregistered Equity

TL;DR

**REBN just sold unregistered equity and signed a big deal, watch for dilution.**

AI Summary

On January 10, 2024, Reborn Coffee, Inc. entered into a material definitive agreement and engaged in unregistered sales of equity securities. This filing indicates potential dilution for existing shareholders as new shares are being issued, which could impact the stock price (REBN). Investors should be aware of these changes as they reflect the company's financing activities and corporate governance adjustments.

Why It Matters

This filing signals that Reborn Coffee is raising capital through equity sales and making significant corporate agreements, which can dilute existing shareholder value and reshape the company's financial structure.

Risk Assessment

Risk Level: medium — The sale of unregistered equity securities often leads to dilution for existing shareholders, which can negatively impact stock price.

Analyst Insight

A smart investor would closely monitor REBN's trading volume and price action for signs of dilution impact and investigate the specifics of the 'Material Definitive Agreement' to understand its long-term implications for the company's financial health and growth prospects.

Key Numbers

• $0.0001 — par value per share (par value of Reborn Coffee's Common Stock)

Key Players & Entities

• Reborn Coffee, Inc. (company) — the registrant filing the 8-K
• January 10, 2024 (date) — date of earliest event reported
• Delaware (company) — state of incorporation for Reborn Coffee, Inc.
• 001-41479 (company) — Commission File Number for Reborn Coffee, Inc.
• REBN (company) — trading symbol for Reborn Coffee, Inc. Common Stock

Forward-Looking Statements

• Reborn Coffee's stock (REBN) may experience downward pressure due to potential dilution from unregistered equity sales. (REBN) — medium confidence, target: Q1 2024

FAQ

Key Financial Figures

• $0.0001 — nge on which registered Common Stock, $0.0001 par value per share REBN The Nasdaq
• $0.60 — "Common Stock"), at a purchase price of $0.60 per share, for aggregate gross proceeds
• $1 million — gregate gross proceeds of approximately $1 million. The Company intends to use the net pro
• $5 million — rstanding for a strategic investment of $5 million from KIB Plug Energy Korea. Negotiation
• $2 million — nue as of the date of this report for a $2 million investment instead of $5 million, and a
• $5 m — for a $2 million investment instead of $5 million, and any such investment will be
• $5 Million — and KIB Plug Energy Korea Sign MOU for $5 Million Investment" 99.2 Press Release of t
• $1 Million — 0, 2024 entitled "Reborn Coffee Secures $1 Million Private Placement Equity Commitment fro

Filing Documents

• ea191660-8k_reborncoffee.htm (8-K) — 35KB
• ea191660ex3-1_reborncoffee.htm (EX-3.1) — 7KB
• ea191660ex10-1_reborncoffee.htm (EX-10.1) — 71KB
• ea191660ex99-1_reborncoffee.htm (EX-99.1) — 9KB
• ea191660ex99-2_reborncoffee.htm (EX-99.2) — 9KB
• ex99-1_001.jpg (GRAPHIC) — 3KB
• ex99-2_001.jpg (GRAPHIC) — 3KB
• 0001213900-24-003761.txt ( ) — 338KB
• rebn-20240110.xsd (EX-101.SCH) — 3KB
• rebn-20240110_lab.xml (EX-101.LAB) — 33KB
• rebn-20240110_pre.xml (EX-101.PRE) — 22KB
• ea191660-8k_reborncoffee_htm.xml (XML) — 3KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On January 10, 2024, Reborn Coffee, Inc., a Delaware corporation (the "Company"), entered into a securities subscription agreement ("Subscription Agreement") with Farooq M. Arjomand (the "Investor"), the Chairman of the Company's Board of Directors and an "accredited investor," as defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). Pursuant to the Subscription Agreement, the Company offered and sold to the Investor a total of 1,666,667 shares of the Company's common stock, par value $0.0001 (the "Common Stock"), at a purchase price of $0.60 per share, for aggregate gross proceeds of approximately $1 million. The Company intends to use the net proceeds from the sale of the Common Stock for working capital and other general corporate purposes. The foregoing description of the Subscription Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the document itself. A copy of the form of the Subscription Agreement is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities The information set forth in "Item 1.01 Entry into a Material Definitive Agreement" relating to the issuance of Common Stock is incorporated by reference herein in its entirety. The Common Stock has not been registered under the Securities Act, and cannot be offered or sold in the United States absent effective registration or an applicable exemption from registration requirements. The Company issued the Common Stock in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act. This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall such securities be offered or sold in the United States absent registration or an applicable exemption from the registration requirements and certificates evidencing such shares containing a legend stating the same.

03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year On January 12, 2024, the Company filed a Certificate of Amendment (the "Certificate of Amendment") to the Company's Certificate of Incorporation to effect a reverse stock split of its issued Common Stock in the ratio of 1-for-8 (the "Reverse Stock Split"). The Company anticipates the Common Stock will begin trading on the Nasdaq Capital Market on a Reverse Stock Split-adjusted basis at the market open on Monday, January 22, 2024. The Reverse Stock Split and the form of Certificate of Amendment were previously approved by the Company's Board of Directors and the Company's stockholders at the Company's meeting of stockholders held on November 6, 2023. No fractional shares will be issued as a result of the Reverse Stock Split. Instead, any fractional shares that would have resulted from the Reverse Stock Split will be rounded up to the next whole number. The Reverse Stock Split affects all stockholders uniformly and will not alter any stockholder's percentage interest in the Company's outstanding Common Stock, except for adjustments that may result from the treatment of fractional shares. The number of authorized shares of Common Stock of the Company and number of authorized, issued, and outstanding shares of the preferred stock of the Company will be unchanged. The above description of the Certificate of Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Certificate of Amendment, which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated by reference herein. 1

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure On November 28, 2023, the Company issued a press release announcing that the Company had entered into a non-binding memorandum of understanding for a strategic investment of $5 million from KIB Plug Energy Korea. Negotiations continue as of the date of this report for a $2 million investment instead of $5 million, and any such investment will be Company has not yet entered into any definitive agreement with KIB Plug Energy Korea. A copy of the press release is included as Exhibit 99.1 and is hereby incorporated by reference. On January 10, 2024, the Company issued a press release announcing the entry into the Subscription Agreement. A copy of the press release is included as Exhibit 99.2 and is hereby incorporated by reference. Exhibit 99.1 and Exhibit 99.2 are being furnished pursuant to Item 7.01 and will not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise be subject to the liabilities of that section, nor will they be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act, regardless of any general incorporation language in such filings. This Current Report on Form 8-K will not be deemed an admission as to the materiality of any information in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits (d) Exhibits. Exhibit No. Description 3.1 Certificate of Amendment to Certificate of Incorporation filed with the Secretary of State of the State of Delaware on January 12, 2024 10.1 Securities Subscription Agreement by and between the Company and the Investor, dated January 10, 2024 99.1 Press Release of the Company dated November 28, 2023 entitled "Reborn Coffee and KIB Plug Energy Korea Sign MOU for $5 Million Investment" 99.2 Press Release of the Company dated January 10, 2024 entitled "Reborn Coffee Secures $1 Million Private Placement Equity Commitment from Chairman Farooq Arjomand, Catalyzing International Growth Initiatives" 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 2 SIGNATURE 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. Dated: January 16, 2024 REBORN COFFEE, INC. By: /s/ Jay Kim Name: Jay Kim Title: Chief Executive Officer 3

View Full Filing

View this 8-K filing on SEC EDGAR