Data Storage (NASDAQ: DTST) plans $10,600,000 ATM share sales
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Data Storage Corporation entered into a new Equity Distribution Agreement with Maxim Group LLC, allowing it to offer and sell, from time to time, shares of common stock under an existing at-the-market program. The related ATM prospectus covers an offering of up to $10,600,000 shares of common stock under the company’s effective Form S-3 shelf registration statement.
Maxim will act as sales agent or principal and use commercially reasonable efforts to execute sales under the company’s instructions, including price, time, and size limits. Data Storage will pay Maxim a 2.5% commission on aggregate gross proceeds, reimburse up to $25,000 of specified expenses, and pay $2,500 for Maxim’s legal fees on each Bringdown Date. The company is not obligated to sell any shares, and there is no assurance that any sales will occur.
Positive
- None.
Negative
- None.
8-K Event Classification
2 items: 1.01, 9.01
2 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
ATM program size: $10,600,000 shares of common stock
Sales commission: 2.5% of aggregate gross proceeds
Expense reimbursement cap: $25,000
+1 more
4 metrics
ATM program size
$10,600,000 shares of common stock
Covered by ATM prospectus under Form S-3 shelf
Sales commission
2.5% of aggregate gross proceeds
Commission payable to Maxim on each sale
Expense reimbursement cap
$25,000
Specified expenses reimbursable to Maxim at signing
Per Bringdown Date legal fee
$2,500
Maxim’s legal fees per Bringdown Date
Key Terms
Equity Distribution Agreement, at the market offering, shelf registration statement, Form S-3, +1 more
5 terms
Equity Distribution Agreement financial
"entered into an Equity Distribution Agreement (the “Agreement”), with Maxim Group LLC"
An equity distribution agreement is a formal plan between a company and financial institutions to sell newly issued shares of the company's stock to investors over a period of time. It helps the company raise money gradually, similar to filling a container with water in stages, rather than all at once. For investors, it provides an organized way to buy shares and can influence the stock's supply and price.
at the market offering financial
"any method deemed to be an “at the market” offering as defined in Rule 415"
An at-the-market offering is a way a company raises cash by selling newly issued shares directly into the open market at prevailing prices, rather than all at once in a single deal. Think of it like turning a faucet on to drip shares into trading at current prices when needed; it gives the company flexibility to raise funds over time but can dilute existing shareholders and potentially affect the stock price, which investors should monitor.
shelf registration statement financial
"forms a part of the Company’s shelf registration statement on Form S-3"
A shelf registration statement is a document a company files with regulators that allows it to sell shares or bonds quickly when it’s a good time to raise money. It’s like having a pre-approved plan ready so the company can act fast without going through lengthy paperwork each time they want to sell, making fundraising more flexible.
Form S-3 regulatory
"shelf registration statement on Form S-3 (File 333-280881)"
Form S-3 is a legal document companies use to register their stock sales with the government, making it easier and faster for them to raise money by selling shares to investors. It’s like having a pre-approved shopping list that lets a company quickly sell new shares when they need funds, without going through a lengthy approval process each time.
ATM Prospectus financial
"which ATM Prospectus forms a part of the Company’s shelf registration statement"
A prospectus for an "at-the-market" (ATM) offering explains a company’s plan to sell newly issued shares directly into the open market over time, at prevailing prices, through one or more broker-dealers. Investors should care because it creates a standing ability for the company to raise cash quickly and incrementally—like an open tab the company can draw on—which can dilute existing shareholders and affect share price and supply.
FAQ
What did Data Storage Corporation (DTST) announce in this 8-K?
Data Storage Corporation entered into a new Equity Distribution Agreement with Maxim Group LLC. This lets the company sell common stock from time to time under an at-the-market program using its existing Form S-3 shelf registration statement and related ATM prospectus.
What is the maximum size of Data Storage Corporation’s ATM offering?
The ATM prospectus relates to an offering of up to $10,600,000 shares of common stock. These shares are registered under the company’s Form S-3 shelf registration statement that was declared effective by the SEC on July 26, 2024.
What role does Maxim Group LLC play in Data Storage Corporation’s ATM program?
Maxim Group LLC acts as sales agent or principal under the Equity Distribution Agreement. It will use commercially reasonable efforts, consistent with normal trading practices and Nasdaq rules, to sell shares of Data Storage’s common stock based on the company’s instructions.
What fees and expenses will Data Storage Corporation pay to Maxim under this agreement?
Data Storage Corporation will pay Maxim a 2.5% commission on aggregate gross proceeds from each sale. It will also reimburse up to $25,000 of specified expenses and pay $2,500 for Maxim’s legal fees on each Bringdown Date under the Equity Distribution Agreement.
Under what registration statement will Data Storage Corporation’s ATM sales be made?
Any sales under the Equity Distribution Agreement will use a prospectus and base prospectus forming part of Data Storage Corporation’s shelf registration statement on Form S-3, File No. 333-280881, which the SEC declared effective on July 26, 2024.