SCND Reports Unregistered Equity Sale from Jan 2023

TL;DR

**SCND sold unregistered shares last year, potentially diluting current stock value.**

AI Summary

SCIENTIFIC INDUSTRIES, INC. (SCND) filed an 8-K on January 22, 2024, reporting an unregistered sale of equity securities that occurred on January 17, 2023. This filing indicates that the company issued new shares without a public registration, which can dilute the value of existing shares. For current or prospective shareholders, this matters because an increase in the total number of shares outstanding, without a corresponding increase in company value, typically reduces the earnings per share and the value of each individual share.

Why It Matters

This filing reveals that SCIENTIFIC INDUSTRIES, INC. issued new shares without public registration, which could dilute the ownership stake and value for existing shareholders.

Risk Assessment

Risk Level: medium — The unregistered sale of equity securities can lead to dilution for existing shareholders, impacting per-share metrics and potentially stock price.

Analyst Insight

A smart investor would investigate the details of the unregistered equity sale, including the number of shares issued and the price, to assess the potential dilution and its impact on per-share metrics before making any investment decisions.

Key Players & Entities

• SCIENTIFIC INDUSTRIES, INC. (company) — registrant
• January 17, 2023 (date) — date of earliest event reported
• January 22, 2024 (date) — filing date
• $0.05 (dollar_amount) — par value per share of Common Stock
• SCND (company) — trading symbol
• OTCMKTS (company) — exchange where registered

FAQ

Key Financial Figures

• $0.05 — ch registered Common Stock, par value $0.05 per share SCND OTCMKTS Indicate b
• $716,776 — mmon Stock for a total consideration of $716,776. Pursuant to the Purchase Agreement, th
• $7,000,000 — or an aggregate gross purchase price of $7,000,000. The Company intends to use the net pro
• $2.50 — rants held by such Existing Investor to $2.50 per share and extend the period in whic
• $2.00 — of Common Stock at an exercise price of $2.00 per share on substantially the same ter

Filing Documents

• scnd_8k.htm (8-K) — 29KB
• 0001654954-24-000793.txt ( ) — 144KB
• scnd-20230117.xsd (EX-101.SCH) — 6KB
• scnd-20230117_lab.xml (EX-101.LAB) — 13KB
• scnd-20230117_cal.xml (EX-101.CAL) — 1KB
• scnd-20230117_pre.xml (EX-101.PRE) — 8KB
• scnd-20230117_def.xml (EX-101.DEF) — 2KB
• scnd_8k_htm.xml (XML) — 3KB

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities The Offering On January 17, 2024, the Company completed the last closing of the sale of securities pursuant to the Company's Securities Purchase Agreement (the "Purchase Agreement") entered on December 13, 2023, as filed in the Company's Form 8-K on December 15, 2023. At this closing, the Company sold, and Investors purchased, an aggregate of 358,388 Units, comprising 358,388 shares of the Company's common stock, par value $.05 per share ("Common Stock") and warrants ("Warrants") to purchase 358,388 shares of Common Stock for a total consideration of $716,776. Pursuant to the Purchase Agreement, the Company sold an aggregate of 3,500,000 Units, comprising 3,500,000 shares of Common Stock and Warrants to purchase 4,535,000 shares of Common Stock for an aggregate gross purchase price of $7,000,000. The Company intends to use the net proceeds from the sale of the Units for working capital needs of its Bioprocessing Systems Operations. As an incentive to certain Investors of the Company who participated in previous private placements ("Existing Investors") and received as part of those financings, warrants ("Outstanding Warrants") to purchase shares of Common Stock, the Company agreed that, if any Existing Investor were to purchase Units at a certain level in the offering thereof under the Purchase Agreement (the "Offering"), the Company would reduce the exercise price of the Outstanding Warrants held by such Existing Investor to $2.50 per share and extend the period in which such Outstanding Warrants could be exercised to the period ending on the fifth anniversary of the date on which the Existing Investor purchased Units under the Purchase Agreement. Each such Existing Investor purchasing Units at the requisite level will receive a new warrant (the "Replacement Warrants") to replace such Existing Investor's Outstanding Warrants. On January 17, 2024, as a result of their purchase of Units, Existing Investors becam

01 Financial Statements and Exhibits

ITEM 9.01 Financial Statements and Exhibits (a),(b),(c) not applicable (d) Exhibits Exhibit No. Description 4.1 Forms of Warrant (incorporated by reference to Form 8-K as filed on December 15, 2023) 4.2 Registration Rights Agreement by and among the Company and the Investors (incorporated by reference to Form 8-K as filed on December 15, 2023) 10.1 Purchase Agreement by and among the Company and the Investors (incorporated by reference to Form 8-K as filed on December 15, 2023) 10.2 Replacement Warrant (incorporated by reference to Form 8-K as filed on December 15, 2023) 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. SCIENTIFIC INDUSTRIES, INC. Date: January 22, 2023 By: /s/ Helena R. Santos Helena R. Santos, President and Chief Executive Officer 3

View Full Filing

View this 8-K filing on SEC EDGAR