Annual report pursuant to Section 13 and 15(d)

Subsequent Events

v3.5.0.2
Subsequent Events
12 Months Ended
Apr. 30, 2016
Subsequent Events [Abstract]  
Subsequent Events

Note 14. Subsequent Events

 

Entry into a Material Definitive Agreement

 

On June 13, 2016, Dataram Corporation, a Nevada corporation ("we" or the "Company") entered into an Agreement and Plan of Merger (the "Merger Agreement") with its wholly owned subsidiary, Dataram Acquisition Sub, Inc., a Nevada corporation (“Acquisition Sub”), U.S. Gold Corp., a Nevada corporation ("U.S. Gold") an exploration state company that owns certain mining leases and other mineral rights comprising the Copper King gold and copper development project located in the Silver Crown Ming District of southeast Wyoming (the “Copper King Project”) and Copper King, LLC, a principal stockholder of U.S. Gold (“Copper King”). The closing of the Merger is subject to customary closing conditions, including, among other things:

 

  the approval of the Company’s shareholders holding a majority of the Company’s outstanding voting capital to issue the Merger Consideration (as defined below) pursuant to the continued listing standards of The NASDAQ Stock Market LLC;

 

  the approval of the Company’s shareholders holding a majority of the Company’s outstanding voting capital to increase the number of shares of authorized Common Stock;

 

  the closing by U.S. Gold of a financing pursuant to which it receives at least $3 million in net proceeds from the sale of its securities (the “U.S. Gold Financing”);

 

  the closing by U.S. Gold of the acquisition of certain mining claims related to a gold development project in Eureka County, Nevada (the “Keystone Project”);

 

  the receipt by the Company of a fairness opinion with respect to the Merger and the Merger Consideration; and

 

  the Company’s Board of Directors shall have declared, as a special dividend, a right entitling each stockholder as of a record date (which shall be no less than five business days prior to the closing of the Merger) to a proportionate ownership interest, record or beneficial, equal to their ownership interest in the Company, of certain pre-Merger Company assets or the proceeds therefrom, as, when and if the Company’s Board of Directors elects to divest such assets within 18 months from the closing of the Merger.

 

Pursuant to the terms and conditions of the Merger Agreement, at the closing of the Merger, the holders of U.S. Gold’s common stock, Series A Preferred Stock and Series B Preferred Stock will be converted into the right to receive shares of the Company’s Common Stock or, at the election of any U.S. Gold stockholder, shares of the Company’s newly designated 0% Series C Convertible Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock), which are convertible into shares of Common Stock (collectively, the “Merger Consideration”). The Merger Consideration shall be allocated as follows and is presented below in terms of Common Stock:

 

  Twenty Million (20,000,000) shares of Common Stock shall be issued to the holders of U.S. Gold’s Series A Preferred Stock;

  One Million Eight Hundred Sixty Six Thousand Seven Hundred and Seventeen (1,866,717) shares of Common Stock shall be issued to the holders of U.S. Gold’s Series B Preferred Stock;

  Up to Fifteen Million One Hundred and Fifty One Thousand Five Hundred and Fifteen (15,151,515) shares of Common Stock shall be issued to holders of U.S. Gold’s common stock issued in connection with the U.S. Gold Financing;

  One Million Eight Hundred and Fifty Thousand (1,850,000) shares of Common Stock shall be issued to the holders of U.S. Gold’s common stock issued in connection with the closing of the acquisition of the Keystone Project; and

 

  One Million Six Hundred and Fifty Thousand (1,650,000) shares of Common Stock shall be issued to certain incoming officers and consultants pursuant to a shareholder approved equity incentive plan of the Company.

 

Restricted Common Share Bonus Awards to Employees, Executive Officers and Directors

 

Between May 1, 2016 and July 29, 2016 the Company awarded approximately 188,280 restricted shares of the Company’s Common Stock to employees, Executive Officers and Directors. The approximate value of these grants is $429,000.

 

Series B Preferred Stock converted to Common Shares

 

The holders of 232,623 Series B Preferred Stock have converted into approximately 1,550,820 restricted shares of Common Stock since the end of the reporting period to the close of business on July 27, 2016.

 

On July 6, 2016, the Company filed a certificate of amendment to its Articles of Incorporation with the Secretary of State of the State of Nevada in order to effectuate a reverse stock split of the Company’s issued and outstanding common stock on a 1 for 3 basis, effective with the State of Nevada on July 8, 2016 in order to regain compliance with NASDAQ’s minimum bid price requirement. The reverse stock split was effective with The NASDAQ Capital Market on July 11, 2016.