Item 1.01 Entry into a Material Definitive Agreement.
Private Placement Offering of Series 1B Convertible Preferred Stock
On June 29, 2023, Ascent Solar Technologies, Inc., a Delaware corporation
(the “Company”), entered into a securities purchase agreement (“Series 1B SPA”) with accredited investors (“Investors”),
for the private placement of $900,000 of the Company’s newly designated Series 1B Convertible Preferred Stock (“Series 1B
Preferred Stock”).
The Series 1B SPA contains customary
representations and warranties and agreements and obligations of the parties.
The Company will sell 900 shares of Series 1B Preferred Stock to the Investors
in exchange for $900,000 of gross proceeds at the closing under the Series 1B SPA.
The proceeds of the offering of Series 1B Preferred Stock will be used
for the Company’s general corporate purposes.
Terms of the Series 1B Preferred Stock
The Company has filed a Certificate of Designations of Preferences, Rights
and Limitations of Series 1B Preferred Stock (“Certificate of Designation”) with the Secretary of State of the State of Delaware.
Rank
The Certificate of Designation provides that the Series 1B Preferred Stock
ranks senior to the common stock with respect to dividends and rights upon liquidation.
Voting Rights
Except as otherwise specifically provided in the Certificate of Designation
or as otherwise required by law, the Series 1B Preferred Stock shall have no voting rights. However, as long as any shares of Series 1B
Preferred Stock are outstanding, the Company shall not, without the affirmative vote of the holders of a majority of the then outstanding
shares of the Series 1B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series 1B Preferred
Stock or alter or amend the Certificate of Designation, (b) amend the Company’s certificate of incorporation or other charter documents
in any manner that adversely affects any rights of the holders of Series 1B Preferred Stock, (c) increase the number of authorized shares
of Series 1B Preferred Stock, or (d) enter into any agreement with respect to any of the foregoing.
Dividends
Holders of the Series 1B Preferred Stock will not be entitled to any fixed
rate of dividends. If the Company pays a dividend or otherwise makes a distribution or distributions payable on shares of common stock,
then the Company shall pay such dividend or make such distribution to the holders of the Series 1B Preferred Stock in such amounts as
each share of Series 1B Preferred Stock would have been entitled to receive if such share of Series 1B Preferred Stock was converted into
shares of common stock at the time of payment of such stock dividend or distribution.
Conversion Rights
Shares of the Series 1B Preferred Stock will be convertible at the option
of the holder into common stock at an initial conversion price of equal to $0.14 per share.
The conversion price for the Series 1B Preferred Stock is subject to adjustment
on the earliest of the date that (a) a resale registration statement relating to the shares of common stock underlying the Series 1B Preferred
Stock has been declared effective by the SEC, (b) all of such underlying shares of common stock have been sold pursuant to SEC Rule 144
or may be sold pursuant to SEC Rule 144 without volume or manner-of-sale restrictions, (c) the one year anniversary of the closing provided
that a holder of such underlying shares is not an affiliate of the Company or (d) all of such underlying shares may be sold pursuant to
an exemption from registration under Section 4(a)(1) of the Securities Act without volume or manner-of-sale restrictions (such earliest
date, the “Reset Date”).
On the Reset Date, the conversion price shall be equal to the lower of
(i) $0.14 and (ii) 90% of the lowest VWAP for the Company’s common stock out of the 10 trading days commencing 5 trading days immediately
prior to the Reset Date, provided that the conversion price may not be adjusted to less than $0.028 per share.
An Investor (together with its affiliates) may not convert any portion
of such Investor’s Series 1B Preferred Stock to the extent that the holder would beneficially own more than 4.99% of the Company’s
outstanding shares of common stock after conversion, except that upon at least 61 days’ prior notice from the Investor to the Company,
the Investor may increase the maximum amount of its beneficial ownership of outstanding shares of the Company’s Common Stock after
converting the holder’s Series 1B Preferred Stock up to 9.99% of the number of shares of Common Stock outstanding immediately after
giving effect to the conversion, as such percentage ownership is determined in accordance with the terms of the Series 1B Preferred Stock.
Until the Company has obtained approval of its stockholders in compliance
with Nasdaq Listing Rule 5635(d), the Company may not issue, upon conversion of the Series 1B Preferred Stock, a number of shares
of common stock which, when aggregated with any shares of common stock issued on or after the original issue date of the Series 1B Preferred
and prior to such conversion date in connection with any conversion of Series 1B Preferred Stock, would exceed 19.99% of the Company’s
currently issued and outstanding shares of common stock.
Redemption
There is no scheduled or mandatory redemption for the Series 1B Preferred
Stock. There is no redemption for the Series 1B Preferred Stock exercisable (i) at the option of the Investor, or (ii) at the option of
the Company.
Liquidation Value
Upon our liquidation, dissolution or winding up, holders of Series 1B Preferred
Stock will be entitled to be paid out of our assets, prior to the holders of our common stock, an amount equal to $1,000 per share plus
any accrued but unpaid dividends (if any) thereon.
* * * * * * * * * *
The foregoing description of the Series 1B SPA and
the Certificate of Designation is a summary and is qualified in its entirety by reference to the documents attached hereto as Exhibits
10.1 and 3.1, which documents are incorporated herein by reference.