SEC Form 4 · accession 0000899243-15-010402

LIGHTING SCIENCE GROUP CORP · LSCG

Statement of changes in beneficial ownership, as filed. Original on EDGAR ↗

Table I — non-derivative securities

Table II — derivative securities

Explanation of responses

• F1On December 7, 2015, Lighting Science Group Corporation (the "Issuer") issued to Pegasus Partners IV, L.P. ("Pegasus Partners") 20,106.03 units of the Issuer's securities (the "Series K Securities"), with each unit consisting of (a) one share of the Issuer's Series K Preferred Stock (the "Series K Preferred Stock") and (b) a warrant to purchase 735 shares of common stock of the Issuer (an "Appeal Bond Warrant") in consideration of Pegasus Partners providing assistance to the Issuer with securing an appeal bond in the amount of $20,106,028.29 (the "Appeal Bond") on the terms set forth in a General Indemnity Agreement and related side letter entered into by and among the Issuer, Pegasus Partners and the issuer of the Appeal Bond (the "Appeal Bond Agreements").
• F2(Continued From Footnote 1) The Series K Preferred Stock is senior to the Issuer's Series H Convertible Preferred Stock (the "Series H Preferred Stock"), the Issuer's Series I Convertible Preferred Stock (the "Series I Preferred Stock"), the Issuer's Series J Convertible Preferred Stock (the "Series J Preferred Stock") and the Issuer's common stock with respect to the payment of dividends and distribution of assets upon liquidation, dissolution or winding up of the Issuer. Depending on whether the Appeal Bond has been drawn or fully released, the Certificate of Designation for the Series K Preferred Stock (the "Series K COD") requires the Issuer to redeem the outstanding shares of Series K Preferred Stock in the event of a liquidation, dissolution or winding up of the Issuer or an earlier change of control or "junior security redemption," which includes events triggering a redemption of the outstanding shares of Series H Preferred Stock,
• F3(Continued From Footnote 2) Series I Preferred Stock or Series J Preferred Stock. The Issuer posted the Appeal Bond in support of its appeal of an Order Granting Plaintiff's Motion for Partial Summary Judgment Under its First Cause of Action for Violation of the Florida Securities and Investment Protection Act (the "Order") that was granted by the Circuit Court of the Ninth Judicial Circuit in and for Orange County, Florida, in securities litigation brought by Geveran Investments Limited. In connection with the issuance of the Series K Securities to Pegasus Partners,
• F4(Continued From Footnote 3) the Issuer agreed to commence a rights offering of the Series K Securities pursuant to which it will offer all holders of Issuer common stock and securities convertible into common stock (other than derivative securities issued pursuant to the Issuer's equity-based compensation plan and employee stock purchase plan) the right to purchase a pro rata share of a like number of Series K Securities as the number issued to Pegasus Partners upon entry into the Appeal Bond Agreements (the "Rights Offering"). The Series K Securities offered pursuant to the Rights Offering will be issued in exchange for a commitment from any exercising holder to fund an amount equal to the product obtained by multiplying (i) the number of Series K Securities to be acquired by such holder by (ii) $1,000, with such commitment to be payable when, as and if the Appeal Bond is drawn upon.
• F5(Continued From Footnote 4) If an exercising holder fails to fund its obligations in accordance with the terms of the Series K COD, Pegasus Partners will remain obligated to fund the applicable amount of the Appeal Bond. Pursuant to the Series K COD, in the event of a claim on the Appeal Bond resulting in a payment by Pegasus Partners to the issuer of the Appeal Bond, such as a loss on appeal and collection of the bond amount from Pegasus Partners pursuant to the Appeal Bond Agreements, the outstanding shares of Series K Preferred Stock will be retained by the holders who have satisfied their obligations to fund their portion of the Appeal Bond in accordance with the terms of the Series K COD (the "Funding Series K Holders").
• F6(Continued From Footnote 5) The Series K COD provides that, following the release or satisfaction in full of the commitments under the Appeal Bond, the Issuer will cancel for no additional consideration all of the shares of Series K Preferred Stock issued to Pegasus Partners and the Funding Series K Holders except a number of shares equal to the product of (x) the number of shares of Series K Preferred Stock held by such holder and (y) a fraction, the numerator of which is the aggregate amount of payments made by such holder with respect to funding the Appeal Bond and the denominator of which is the aggregate liquidation value (calculated by multiplying the number of shares held by such holder by $1,000) of such shares of Series K Preferred Stock, rounded down to the nearest whole share. In the event that the Issuer wins the appeal of the Order, upon the expiration or termination of the Appeal Bond, all shares of Series K Preferred Stock will be cancelled for no consideration.
• F7(Continued From Footnote 6)The Appeal Bond Warrant will be exercisable beginning on the date that the Appeal Bond has been fully drawn or all commitments thereunder have been released and ending on the earlier of: (i) December 31, 2025, (ii) the date on which the Issuer consummates a Qualified Public Offering (as defined in the Appeal Bond Warrant), or (iii) the date of any Change of Control (as defined in the Appeal Bond Warrant). The Appeal Bond Warrant will be exercisable at an exercise price of $0.12 per share, subject to adjustments as provided in the Appeal Bond Warrant. Pegasus Partners and any Funding Series K Holders will retain the Appeal Bond Warrant(s) issued to such holders as consideration for their agreement to support the Appeal Bond regardless of whether such holders are required to make payments with respect to funding the Appeal Bond.
• F8Pegasus Investors IV, L.P. ("Pegasus Investors") may be deemed to indirectly beneficially own the securities of the Issuer held by Pegasus Partners because Pegasus Investors is the general partner of Pegasus Partners. Pegasus Investors IV GP, L.L.C. ("Pegasus GP") is the general partner of Pegasus Investors. Pegasus GP is wholly owned by Pegasus Capital, LLC ("Pegasus Capital"). Craig Cogut ("Mr. Cogut") may be deemed to directly or indirectly control Pegasus Capital. Each of Pegasus Investors, Pegasus GP, Pegasus Capital and Mr. Cogut disclaims beneficial ownership of any of the Issuer's securities directly held by Pegasus Partners except to the extent of their pecuniary interest therein, and this report shall not be deemed an admission that any of Pegasus Investors, Pegasus GP, Pegasus Capital or Mr. Cogut is the beneficial owner of such securities for purposes of Section 16 or any other purpose.

Remarks

For purposes of Section 16 of the Securities Exchange Act of 1934, as amended, the reporting persons are deemed directors by deputization by virtue of their representation on the Board of Directors of Lighting Science Group Corporation.