Unusual Machines Reports Material Agreements & Equity Sales

TL;DR

UMAC filed an 8-K detailing new deals and stock sales from July 17th.

AI Summary

Unusual Machines, Inc. filed an 8-K on July 22, 2024, reporting on several key events that occurred on July 17, 2024. These include entering into a material definitive agreement, unregistered sales of equity securities, amendments to its articles of incorporation or bylaws, and a Regulation FD disclosure. The filing also contains financial statements and exhibits.

Why It Matters

This filing indicates significant corporate actions, including new agreements and equity transactions, which could impact the company's financial structure and future operations.

Risk Assessment

Risk Level: medium — The filing involves material definitive agreements and unregistered sales of equity, which can introduce financial and operational risks.

Key Players & Entities

• Unusual Machines, Inc. (company) — Registrant
• July 17, 2024 (date) — Date of earliest event reported
• July 22, 2024 (date) — Date of report

FAQ

Key Financial Figures

• $0.01 — e on Which Registered Common Stock, $0.01 UMAC NYSE American Indicate by chec
• $2,000,000 — 16, 2024, the Company issued Red Cat a $2,000,000 8% Promissory Note with interest payabl
• $4,000,000 — increased aggregate principal amount of $4,000,000 to give effect to certain working capit
• $5.0 million — re the Company receives net proceeds of $5.0 million in one or more related transactions, th

Filing Documents

• umac_8k.htm (8-K) — 37KB
• umac_ex0301.htm (EX-3.1) — 55KB
• umac_ex0401.htm (EX-4.1) — 98KB
• umac_ex1001.htm (EX-10.1) — 46KB
• umac_ex1002.htm (EX-10.2) — 12KB
• umac_ex9901.htm (EX-99.1) — 7KB
• image_001.jpg (GRAPHIC) — 356KB
• image_002.jpg (GRAPHIC) — 283KB
• image_003.jpg (GRAPHIC) — 358KB
• image_004.jpg (GRAPHIC) — 381KB
• image_005.jpg (GRAPHIC) — 372KB
• image_006.jpg (GRAPHIC) — 392KB
• image_007.jpg (GRAPHIC) — 364KB
• image_008.jpg (GRAPHIC) — 388KB
• image_009.jpg (GRAPHIC) — 369KB
• image_010.jpg (GRAPHIC) — 326KB
• image_011.jpg (GRAPHIC) — 351KB
• image_012.jpg (GRAPHIC) — 184KB
• image_013.jpg (GRAPHIC) — 47KB
• image_014.jpg (GRAPHIC) — 139KB
• 0001683168-24-004979.txt ( ) — 6432KB
• umac-20240717.xsd (EX-101.SCH) — 3KB
• umac-20240717_lab.xml (EX-101.LAB) — 33KB
• umac-20240717_pre.xml (EX-101.PRE) — 22KB
• umac_8k_htm.xml (XML) — 4KB

01 Entry into a Material Definitive

Item 1.01 Entry into a Material Definitive Agreement. Red Cat Holdings, Inc.'s Sale of Securities On July 22, 2024, Unusual Machine's Inc.'s (the "Company") principal shareholder, Red Cat Holdings, Inc. ("Red Cat") sold all of its securities in the Company to two unaffiliated third party investors (the "Investors"). Red Cat's Chief Executive Officer, Jeffrey Thompson, is a member of our Board of Directors. As part of the transaction, on July 22, 2024, Red Cat entered into an Exchange Agreement with the Company pursuant to which Red Cat exchanged 4,250,000 shares of the Company's common stock, par value $0.01 per share for 4,250 shares of the Company's newly designated Series A Convertible Preferred Stock (the "Series A"). Red Cat then sold the Series A and the New Notes, as defined, to the Investors on July 22, 2024. On February 16, 2024, the Company issued Red Cat a $2,000,000 8% Promissory Note with interest payable monthly and the principal due in 18 months (the "Original Note"). On July 19, 2024, the Original Note was reissued to Red Cat and simultaneously transferred to the Investors in two separate promissory notes (the "New Notes") with (i) an increased aggregate principal amount of $4,000,000 to give effect to certain working capital adjustments discussed below, and (ii) a maturity date of November 30, 2025. In the event of a qualified financing of debt or equity where the Company receives net proceeds of $5.0 million in one or more related transactions, the Investors may require the Company to repay the New Notes with accrued interest thereon in cash. Upon an event of default, the Investors may require the Company to convert the New Notes into shares of our common stock, subject to beneficial ownership limitations set forth in the New Notes, at a conversion price equal to an amount of the 10 day average VWAP, as defined in the New Notes prior to the conversion date. The foregoing descriptions of the Exchange Agreement and New Notes do not purport to b

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities. To the extent required by Item 3.02, the information contained in Item 1.01 regarding the issuance of the Series A to Red Cat is incorporated by reference. The transaction was exempt from registration pursuant to Section 3(a)(9) of the Securities Act of 1933.

03 Amendments to Articles of Incorporation

Item 5.03 Amendments to Articles of Incorporation or Bylaws. On July 17, 2024, following approval by the Board of Directors, the Company filed a Certificate of Designations, Preferences, and Rights of the Series A Convertible Preferred Stock (the "COD") with the Nevada Secretary of State. The COD designated 4,250 shares of Series A Convertible Preferred Stock (the "Series A"), par value $0.01 per share. The Series A ranks senior to both the Company's common stock and any other series of preferred stock with respect to the preferences as to dividends, distributions, and payments, upon the liquidation, dissolution, and winding up of the Company. Each share of Series A may be converted into 1,000 shares of the Company's common stock. 2 The Series A has a conversion beneficial ownership limitation of 4.99%, or 9.99% upon election of the holder upon at least 61 days written notice to the Company. The Series A has no voting rights, except as required by law and as expressly provided in the COD. The COD became effective on July 17, 2024. The foregoing description of the Series A and the COD does not purport to be complete and is qualified in its entirety by reference to the COD, a copy of which is filed hereto as Exhibit 3.1 and is incorporated herein by reference.

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. On July 22, 2024, the Company issued a press release announcing the Working Capital Adjustment Agreement and certain other related transactions. A copy of the press release is being furnished as Exhibit 99.1.

01 Financial

Item 9.01 Financial (d) Exhibits Exhibit No. Exhibit 3.1 Certificate of Designations, Preferences, and Rights of the Series A Convertible Preferred Stock of Unusual Machines, Inc. 4.1 Form of 8% Promissory Note * 10.1 Form of Exchange Agreement * 10.2 Form of Closing Date Working Capital Agreement and Consent * 99.1 Press Release issued by Unusual Machines, Inc. on July 22, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) * Certain schedules, appendices and exhibits to this agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission staff upon request. 3

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. Unusual Machines, Inc. Date: July 22, 2024 By: /s/ Allan Evans Name: Allan Evans Title: Chief Executive Officer 4

View Full Filing

View this 8-K filing on SEC EDGAR