Item 1.01 Entry into a Material Definitive Agreement
On
September 21, 2022, Loop Media, Inc. (the “Company”), entered into an underwriting agreement (the
“Underwriting Agreement”), with Roth Capital Partners, LLC, (the “Underwriter”), pursuant to which the
Company agreed to sell to the Underwriter, acting as the sole manager, in a firm commitment underwritten public offering (the “Offering”)
2,400,000 shares (the “Shares”) of its common stock, par value $0.0001 per share
(“Common Stock”) at a public offering price of $5.00 per share, less underwriting discounts and commissions. In addition, the Company granted the Underwriter a
30-day over-allotment option to purchase up to an additional 360,000 Shares at the public offering price, less underwriting
discounts and commissions. The Offering is expected to close on September 26, 2022.
Pursuant to the Underwriting
Agreement, the Company will issue to the Underwriter warrants to purchase up to an aggregate of 192,000 shares of Common Stock (or up to 220,800 shares of Common
Stock if the Underwriter’s option to purchase additional shares is exercised in full) (the “Underwriter
Warrants”). The Underwriter Warrants are exercisable upon issuance and will expire on September 21, 2027. The initial exercise
price of Representative’s Warrants is $6.00 per share, which equals 120% of the per share public offering price in the Offering.
The net proceeds to the Company from the
Offering are expected to be approximately $10.4 million (or approximately $12.0 million if the Underwriter’s option to
purchase additional shares is exercised in full), after deducting underwriting discounts and commissions and estimated offering
expenses. The Company expects to use the proceeds from
the Offering for marketing, new customer development, payment of offering-related bonuses to certain of its officers, working
capital and other general corporate purposes.
The Shares are being sold to the public pursuant to the Company’s registration statement on Form S-1 (File No. 333-262416), initially filed
by the Company with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”)
on January 28, 2022, and declared effective on September 21, 2022.
In connection with the offering, the Company
was approved for the listing of its common stock on the NYSE American and commenced trading on the NYSE American under the ticker symbol
“LPTV” on September 22, 2022.
The Underwriting Agreement
contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations
of the Company and the Underwriter, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties
and termination provisions. Further, pursuant to the terms of the Underwriting Agreement and related “lock-up” agreements,
the Company, each director and executive officer of the Company, and certain stockholders have agreed with the Underwriter not to offer
for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our Common Stock or securities convertible into Common
Stock for a period of 90 days commencing on the date of the final prospectus.
The foregoing description
of the Underwriting Agreement and the Underwriter Warrants are not complete and are qualified in their entirety by references to the full
text of the Underwriting Agreement and the form of Underwriter Warrants which are filed as exhibits 1.1 and 4.1, respectively, to this
report and are incorporated by reference herein.