Filed pursuant to Rule 424(b)(3)
SEC File No. 333-267449
PROSPECTUS SUPPLEMENT NO. 5
(to Prospectus dated May 12, 2023)
Nogin, Inc.
1,069,334 Shares of Common Stock Issuable Upon Exercise of Warrants
3,801,966 Shares of Common Stock
9,982,754 Warrants
This prospectus supplement updates, amends and supplements the prospectus dated May 12, 2023 (as supplemented or amended from time to time, the “Prospectus”), which forms a part of our Registration Statement on Form S-1 (Registration No. 333-267449). Capitalized terms used in this prospectus supplement and not otherwise defined herein have the meanings specified in the Prospectus.
This prospectus supplement is being filed to update, amend and supplement the information included in the Prospectus with information contained in our Quarterly Report on Form 10-Q filed with the SEC on August 14, 2023, which is set forth below.
This prospectus supplement is not complete without the Prospectus. This prospectus supplement should be read in conjunction with the Prospectus, which is to be delivered with this prospectus supplement, and is qualified by reference thereto, except to the extent that the information in this prospectus supplement updates or supersedes the information contained in the Prospectus. Please keep this prospectus supplement with your Prospectus for future reference.
Our Common Stock and Warrants are listed on the Nasdaq Stock Market LLC under the trading symbols “NOGN” and “NOGNW,” respectively. On August 11, 2023, the closing prices for our Common Stock and Warrants on the Nasdaq Stock Market LLC were $0.75 per share of Common Stock and $0.011 per Warrant.
Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 9 of the Prospectus and other risk factors contained in the documents incorporated by reference therein for a discussion of information that should be considered in connection with an investment in our securities.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if the Prospectus or this prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus supplement is August 14, 2023
|
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2023
OR
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For transition period from to
Commission File Number 001-40682
Nogin, Inc.
(Exact name of registrant as specified in its charter)
Delaware |
|
86-1370703 |
(State or other jurisdiction of incorporation or organization) |
|
(I.R.S. Employer Identification Number) |
1775 Flight Way STE 400
Tustin, CA 92782
(949) 222-0209
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
|
Trading Symbol |
|
Name of each exchange on which registered |
Common stock, par value $0.0001 per share |
|
NOGN |
|
The Nasdaq Stock Market LLC |
Warrants to purchase common stock |
|
NOGNW |
|
The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☐ |
Accelerated filer |
☐ |
Non-accelerated filer |
☒ |
Smaller reporting company |
☒ |
|
|
Emerging growth company |
☒ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒
As of August 10, 2023, there were 11,092,559 shares of the registrant’s common stock outstanding, par value $0.0001 per share.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (this “Report”) contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Report, including statements concerning possible or assumed future actions, business strategies, events or results of operations, and any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking statements by terms such as “may,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Report are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Report and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the risks, uncertainties and assumptions described under the section in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (the “SEC”) on March 23, 2023 titled “Risk Factors.” These forward-looking statements are subject to numerous risks, including, without limitation, the following:
|
Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur, and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. As a result of these factors, we cannot assure you that the forward-looking statements in this Report will prove to be accurate. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
You should read this Report completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
Nogin, Inc. and Subsidiaries
Form 10-Q
Table of Contents
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
Nogin, Inc. and Subsidiaries
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2023 |
|
|
2022 |
|
||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash |
|
$ |
3,143 |
|
|
$ |
15,385 |
|
Accounts receivable, net |
|
|
1,908 |
|
|
|
1,578 |
|
Inventory |
|
|
13,146 |
|
|
|
15,726 |
|
Prepaid expenses and other current assets |
|
|
1,977 |
|
|
|
2,539 |
|
Total current assets |
|
|
20,174 |
|
|
|
35,228 |
|
Property and equipment, net |
|
|
1,895 |
|
|
|
1,595 |
|
Right-of-use asset, net (Note 19) |
|
|
16,272 |
|
|
|
17,391 |
|
Goodwill |
|
|
6,748 |
|
|
|
6,748 |
|
Intangible assets, net |
|
|
5,384 |
|
|
|
5,493 |
|
Investment in unconsolidated affiliates |
|
|
6,466 |
|
|
|
7,404 |
|
Other non-current asset |
|
|
972 |
|
|
|
1,074 |
|
Total assets |
|
$ |
57,911 |
|
|
$ |
74,933 |
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
13,936 |
|
|
$ |
19,605 |
|
Due to clients |
|
|
3,609 |
|
|
|
10,891 |
|
Related party payables |
|
|
869 |
|
|
|
1,033 |
|
Loans (Note 7) |
|
|
3,155 |
|
|
|
— |
|
Accrued expenses and other liabilities (Note 6) |
|
|
16,281 |
|
|
|
17,826 |
|
Lease liabilities, current portion (Note 19) |
|
|
4,512 |
|
|
|
4,367 |
|
Total current liabilities |
|
|
42,362 |
|
|
|
53,722 |
|
Long-term note payable, net |
|
|
329 |
|
|
|
— |
|
Convertible notes (Note 7) |
|
|
59,134 |
|
|
|
60,852 |
|
Deferred tax liabilities |
|
|
407 |
|
|
|
394 |
|
Lease liabilities, net of current portion (Note 19) |
|
|
13,637 |
|
|
|
15,223 |
|
Other long-term liabilities (Note 6) |
|
|
23,472 |
|
|
|
17,766 |
|
Total liabilities |
|
|
139,341 |
|
|
|
147,957 |
|
|
|
|
|
|
|
|
||
STOCKHOLDERS’ DEFICIT |
|
|
|
|
|
|
||
Common stock, $0.0001 par value, 500,000,000 shares authorized; 11,092,559 and 3,334,714 shares issued and outstanding as of June 30, 2023 and December 31, 2022 |
|
|
1 |
|
|
|
— |
|
Additional paid-in capital |
|
|
22,596 |
|
|
|
9,270 |
|
Accumulated deficit |
|
|
(104,027 |
) |
|
|
(82,294 |
) |
Total stockholders’ deficit |
|
|
(81,430 |
) |
|
|
(73,024 |
) |
Total liabilities and stockholders’ deficit |
|
$ |
57,911 |
|
|
$ |
74,933 |
|
See the accompanying notes to the unaudited condensed consolidated financial statements.
1
Nogin, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Operations
(In thousands, except share and per share data)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
||||
Net service revenue |
|
$ |
7,543 |
|
|
$ |
9,254 |
|
|
$ |
16,461 |
|
|
$ |
17,787 |
|
Net product revenue |
|
|
4,739 |
|
|
|
7,834 |
|
|
|
11,284 |
|
|
|
20,756 |
|
Net revenue from related parties |
|
|
460 |
|
|
|
3,262 |
|
|
|
1,674 |
|
|
|
7,005 |
|
Total net revenue |
|
|
12,742 |
|
|
|
20,350 |
|
|
|
29,419 |
|
|
|
45,548 |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cost of services (1) |
|
|
3,277 |
|
|
|
5,757 |
|
|
|
8,807 |
|
|
|
11,192 |
|
Cost of product revenue (1) |
|
|
1,972 |
|
|
|
5,156 |
|
|
|
5,913 |
|
|
|
15,407 |
|
Sales and marketing |
|
|
715 |
|
|
|
620 |
|
|
|
1,417 |
|
|
|
1,186 |
|
Research and development |
|
|
1,163 |
|
|
|
1,250 |
|
|
|
2,126 |
|
|
|
2,827 |
|
General and administrative |
|
|
15,814 |
|
|
|
13,140 |
|
|
|
33,139 |
|
|
|
30,362 |
|
Depreciation and amortization |
|
|
235 |
|
|
|
219 |
|
|
|
437 |
|
|
|
420 |
|
Total operating costs and expenses |
|
|
23,176 |
|
|
|
26,142 |
|
|
|
51,839 |
|
|
|
61,394 |
|
Operating loss |
|
|
(10,434 |
) |
|
|
(5,792 |
) |
|
|
(22,420 |
) |
|
|
(15,846 |
) |
Interest expense |
|
|
(2,777 |
) |
|
|
(1,464 |
) |
|
|
(4,791 |
) |
|
|
(2,117 |
) |
Change in fair value of promissory notes |
|
|
(259 |
) |
|
|
(2,566 |
) |
|
|
(418 |
) |
|
|
(2,566 |
) |
Change in fair value of derivative instruments |
|
|
3,462 |
|
|
|
— |
|
|
|
4,309 |
|
|
|
— |
|
Change in fair value of unconsolidated affiliates |
|
|
(293 |
) |
|
|
(949 |
) |
|
|
(938 |
) |
|
|
(1,982 |
) |
Change in fair value of convertible notes |
|
|
(1,296 |
) |
|
|
— |
|
|
|
3,295 |
|
|
|
— |
|
Debt extinguishment gain |
|
|
63 |
|
|
|
— |
|
|
|
63 |
|
|
|
— |
|
Other (loss) income, net |
|
|
(259 |
) |
|
|
(292 |
) |
|
|
(818 |
) |
|
|
1,661 |
|
Loss before income taxes |
|
|
(11,793 |
) |
|
|
(11,063 |
) |
|
|
(21,718 |
) |
|
|
(20,850 |
) |
(Benefit) Provision for income taxes |
|
|
39 |
|
|
|
(93 |
) |
|
|
13 |
|
|
|
65 |
|
Net loss |
|
$ |
(11,832 |
) |
|
$ |
(10,970 |
) |
|
$ |
(21,732 |
) |
|
$ |
(20,915 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss per common share – basic and diluted |
|
$ |
(1.13 |
) |
|
$ |
(5.54 |
) |
|
$ |
(3.13 |
) |
|
$ |
(10.56 |
) |
Weighted average shares outstanding – basic and diluted |
|
|
10,506,521 |
|
|
|
1,981,097 |
|
|
|
6,940,429 |
|
|
|
1,981,097 |
|
See the accompanying notes to the unaudited condensed consolidated financial statements
2
Nogin, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Stockholders’ Deficit
(In thousands, except share data)
|
|
Convertible Redeemable Preferred Stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
|
|
Series A |
|
|
Series B |
|
|
Common Stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Additional Paid-in Capital |
|
|
Treasury Stock |
|
|
Accumulated Deficit |
|
|
Total Stockholders’ Deficit |
|
||||||||||
Balance, December 31, 2021 |
|
|
443,224 |
|
|
|
4,687 |
|
|
|
316,707 |
|
|
|
6,502 |
|
|
|
1,981,097 |
|
|
|
— |
|
|
|
4,362 |
|
|
|
(1,330 |
) |
|
|
(16,262 |
) |
|
|
(13,230 |
) |
Stock-based Compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
58 |
|
|
|
— |
|
|
|
— |
|
|
|
58 |
|
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(9,942 |
) |
|
|
(9,942 |
) |
Balance, March 31, 2022 |
|
|
443,224 |
|
|
$ |
4,687 |
|
|
|
316,707 |
|
|
$ |
6,502 |
|
|
|
1,981,097 |
|
|
$ |
— |
|
|
$ |
4,420 |
|
|
$ |
(1,330 |
) |
|
$ |
(26,204 |
) |
|
$ |
(23,114 |
) |
Stock-based Compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
Warrant issuance |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
713 |
|
|
|
— |
|
|
|
— |
|
|
|
713 |
|
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(10,970 |
) |
|
|
(10,970 |
) |
Balance, June 30, 2022 |
|
|
443,224 |
|
|
$ |
4,687 |
|
|
|
316,707 |
|
|
$ |
6,502 |
|
|
|
1,981,097 |
|
|
$ |
— |
|
|
$ |
5,158 |
|
|
$ |
(1,330 |
) |
|
$ |
(37,174 |
) |
|
$ |
(33,346 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, December 31, 2022 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,334,714 |
|
|
|
— |
|
|
|
9,270 |
|
|
|
— |
|
|
|
(82,294 |
) |
|
|
(73,024 |
) |
Stock-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
253 |
|
|
|
— |
|
|
|
— |
|
|
|
253 |
|
Fair value of equity classified warrants in common stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
430 |
|
|
|
— |
|
|
|
— |
|
|
|
430 |
|
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(9,901 |
) |
|
|
(9,901 |
) |
Balance, March 31, 2023 |
|
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
|
|
3,334,714 |
|
|
$ |
— |
|
|
$ |
9,953 |
|
|
$ |
— |
|
|
$ |
(92,195 |
) |
|
$ |
(82,242 |
) |
Stock and warrant issuance |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,699,277 |
|
|
|
1 |
|
|
|
12,526 |
|
|
|
— |
|
|
|
— |
|
|
|
12,527 |
|
Stock-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
117 |
|
|
|
— |
|
|
|
— |
|
|
|
117 |
|
Warrant exercise |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
58,568 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(11,832 |
) |
|
|
(11,832 |
) |
Balance, June 30, 2023 |
|
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
|
|
11,092,559 |
|
|
$ |
1 |
|
|
$ |
22,596 |
|
|
$ |
— |
|
|
$ |
(104,027 |
) |
|
$ |
(81,430 |
) |
See the accompanying notes to the unaudited condensed consolidated financial statements
3
Nogin, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Cash Flows
(In thousands)
|
|
Six Months Ended June 30, |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
||
Net loss |
|
$ |
(21,732 |
) |
|
$ |
(20,915 |
) |
Adjustments to reconcile net loss to net cash used by operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
437 |
|
|
|
420 |
|
Amortization of debt issuance costs and discounts |
|
|
722 |
|
|
|
802 |
|
Debt issuance costs expensed under fair value option |
|
|
554 |
|
|
|
— |
|
Stock-based compensation |
|
|
370 |
|
|
|
83 |
|
Deferred income taxes |
|
|
13 |
|
|
|
65 |
|
Change in fair value of unconsolidated affiliates |
|
|
938 |
|
|
|
1,982 |
|
Change in fair value of warrant liability |
|
|
(3,739 |
) |
|
|
509 |
|
Change in fair value of promissory notes |
|
|
878 |
|
|
|
2,566 |
|
Change in fair value of convertible notes |
|
|
(3,295 |
) |
|
|
— |
|
Change in fair value of derivatives |
|
|
(847 |
) |
|
|
— |
|
Settlement of deferred revenue |
|
|
— |
|
|
|
(1,611 |
) |
Gain on extinguishment of accounts payable liabilities |
|
|
(63 |
) |
|
|
— |
|
(Gain) loss on disposal of asset |
|
|
(1 |
) |
|
|
82 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
(331 |
) |
|
|
(546 |
) |
Related party receivables |
|
|
— |
|
|
|
(880 |
) |
Inventory |
|
|
2,580 |
|
|
|
6,392 |
|
Prepaid expenses and other current assets |
|
|
2,469 |
|
|
|
(2,306 |
) |
Other non-current assets |
|
|
85 |
|
|
|
— |
|
Accounts payable |
|
|
(3,673 |
) |
|
|
(12 |
) |
Due to clients |
|
|
(7,280 |
) |
|
|
(555 |
) |
Related party payables |
|
|
(164 |
) |
|
|
1,870 |
|
Lease assets and liabilities |
|
|
(323 |
) |
|
|
— |
|
Accrued expenses and other liabilities |
|
|
2,187 |
|
|
|
(1,139 |
) |
Net cash used in operating activities |
|
|
(30,215 |
) |
|
|
(13,193 |
) |
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
||
Purchases of property and equipment |
|
|
(613 |
) |
|
|
(226 |
) |
Proceeds from sale of property and equipment |
|
|
4 |
|
|
|
— |
|
Net cash used in investing activities |
|
|
(609 |
) |
|
|
(226 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Proceeds from issuance of April 2023 Offering |
|
|
22,000 |
|
|
|
— |
|
Payment of issuance costs for April 2023 Offering |
|
|
(1,291 |
) |
|
|
— |
|
Proceeds from short-term loan |
|
|
3,275 |
|
|
|
— |
|
Payment of short-term loan |
|
|
(1,743 |
) |
|
|
— |
|
Proceeds from promissory notes |
|
|
— |
|
|
|
5,000 |
|
Proceeds from promissory notes – related parties |
|
|
— |
|
|
|
1,975 |
|
Payment of promissory notes |
|
|
(3,478 |
) |
|
|
— |
|
Payment of promissory notes – related parties |
|
|
(106 |
) |
|
|
— |
|
Payment of debt issuance costs |
|
|
(75 |
) |
|
|
(70 |
) |
Proceeds from line of credit |
|
|
— |
|
|
|
86,905 |
|
Repayments of line of credit |
|
|
— |
|
|
|
(82,255 |
) |
Net cash provided by financing activities |
|
|
18,582 |
|
|
|
11,555 |
|
NET DECREASE IN CASH AND RESTRICTED CASH |
|
|
(12,242 |
) |
|
|
(1,864 |
) |
Beginning of period |
|
|
15,385 |
|
|
|
4,571 |
|
End of period |
|
$ |
3,143 |
|
|
$ |
2,707 |
|
|
|
|
|
|
|
|
||
SUPPLEMENTAL CASH FLOW INFORMATION |
|
|
|
|
|
|
||
Cash paid for interest |
|
$ |
959 |
|
|
$ |
1,288 |
|
Cash paid for taxes |
|
|
118 |
|
|
|
169 |
|
Right-of-use assets exchanged for lease liabilities |
|
|
1,120 |
|
|
|
— |
|
|
|
|
|
|
|
|
||
Noncash Investing and Financing Activities |
|
|
|
|
|
|
||
Issuance of warrants with debt |
|
$ |
1,483 |
|
|
|
— |
|
Promissory Note Issuance (Default Interest) |
|
|
4,649 |
|
|
|
— |
|
Issuance of note to extinguish accounts payable |
|
|
1,933 |
|
|
|
— |
|
|
|
|
|
|
|
|
||
SCHEDULE OF CASH AND RESTRICTED CASH |
|
|
|
|
|
|
||
Cash |
|
$ |
3,143 |
|
|
$ |
1,207 |
|
Restricted cash |
|
|
— |
|
|
|
1,500 |
|
Total cash and restricted cash |
|
$ |
3,143 |
|
|
$ |
2,707 |
|
4
See the accompanying notes to the unaudited condensed consolidated financial statements
5
Nogin, Inc. and Subsidiaries
Note to Unaudited Condensed Consolidated Financial Statements
Nogin, Inc. (together with its subsidiaries, the “Company” or “Nogin”) is an e-commerce, technology platform provider that delivers Commerce-as-a-Service (“CaaS”) solutions as a headless, flexible full stack enterprise commerce platform with cloud services and optimizations along with experts for brands and retailers that provide a unique combination of customizability and sales efficiency. The Company manages clients’ front-to-back-end operations so clients can focus on their business. The Company’s business model is based on providing a comprehensive e-commerce solution to its customers on a revenue sharing basis. Unless the context otherwise requires, references in this subsection to “we,” “our,” “Nogin” and the “Company” refer to the business and operations of Legacy Nogin (as defined below) and its consolidated subsidiaries prior to the Business Combination (as defined below) and to Nogin, Inc. (formerly known as Software Acquisition Group Inc. III) and its consolidated subsidiaries following the consummation of the Business Combination.
The Company’s headquarters and principal place of business are in Tustin, California.
Reverse Stock Split
On March 18, 2023, the Company’s Board of Directors (the “Board”) approved a one-for-twenty reverse stock split of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). The reverse stock split became effective upon filing of a certificate of amendment to the Company’s second amended and restated certificate of incorporation on March 28, 2023. Upon the effectiveness of the reverse stock split, (i) every twenty shares of outstanding Common Stock were reclassified and combined into one share of Common Stock and (ii) the number of Common Stock for which each outstanding option and warrant to purchase Common Stock is exercisable was proportionately decreased and the exercise price per share of Common Stock of each outstanding option and warrant to purchase Common Stock was proportionately increased. No fractional shares were issued as a result of the reverse stock split. The total number of authorized shares of Common Stock and the par value per share of Common Stock did not change as a result of the reverse stock split. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split and exercise price of each outstanding option and warrant as if the transaction had occurred as of the beginning of the earliest period presented.
Business Combination
On August 26, 2022 (the “Closing Date”), the Company completed its previously announced Business Combination pursuant to the Agreement and Plan of Merger (the “Merger Agreement”), dated as of February 14, 2022 (as amended on April 19, 2022 and August 26, 2022), by and among the Company (formerly known as Software Acquisition Group Inc. III (“SWAG”)), Nuevo Merger Sub, Inc., a wholly owned subsidiary of SWAG (“Merger Sub”), and Branded Online, Inc. dba Nogin (“Legacy Nogin”). Pursuant to the Merger Agreement, Merger Sub was merged with and into Legacy Nogin, with Legacy Nogin surviving the Business Combination as a wholly owned subsidiary of the Company (the “Business Combination” and, together with the other transactions contemplated by the Merger Agreement, the “Transactions”).
While Legacy Nogin became a wholly-owned subsidiary of the Company, Legacy Nogin was deemed to be the acquirer in the Business Combination for accounting purposes. Accordingly, the Business Combination was accounted for as a reverse recapitalization, in which case the condensed consolidated financial statements of the Company represent a continuation of Legacy Nogin and the issuance of common stock and cash consideration in exchange for the net assets of SWAG recognized at historical costs and no recognition of goodwill or other intangible assets. Operations prior to the Business Combination are those of Legacy Nogin and all share and per-share data included in these condensed consolidated financial statements have been retroactively adjusted to give effect to the Business Combination.
As a result of the Business Combination, equity holders of Legacy Nogin received approximately 2.7 million shares of Common Stock and cash consideration of $15.0 million, of which $10.9 million was deferred on the Closing Date (Note 9).
The treatment of the Business Combination as a reverse recapitalization was based on the stockholders of Legacy Nogin holding the majority of voting interests of the Company, Legacy Nogin’s existing management team serving primarily as the initial management team of the Company, Legacy Nogin’s appointment of the majority of the initial board of directors of the Company and Legacy Nogin’s operations comprising the ongoing operations of the Company.
In connection with the Business Combination, the Company received proceeds of approximately $58.8 million from SWAG’s trust account, net of redemptions by SWAG’s public shareholders, as well as approximately $65.5 million in proceeds from the contemporaneous issuance of 7.00% Convertible Senior Notes due 2026 (the “Convertible Notes”). The aggregate cash raised has been used for general business purposes, the paydown of Legacy Nogin’s outstanding debt, the payment of transaction costs and the payment of the cash consideration.
6
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying condensed financial statements should be read in conjunction with the Company’s Consolidated Financial Statements for the year ended December 31, 2022. The interim results for the six months ended June 30, 2023 are not necessarily indicative of the results to be expected for the period ending December 31, 2023, or for any future annual or interim periods.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.
Liquidity and Capital Resources
Our primary requirements for short-term liquidity and capital are working capital, inventory management, capital expenditures, public company costs and general corporate needs. We expect these needs to continue as we develop and grow our business. Our future capital requirements will depend on many factors, including our levels of revenue, the expansion of sales and marketing activities, successful customer acquisitions, the results of business initiatives, the timing of new product introductions and overall economic conditions.
Prior to the Business Combination, the Company’s available liquidity and operations were financed through equity contributions, a line of credit, promissory notes and cash flow from operations. Moving forward, the Company expects to fund operations through equity contributions and cash flow from operations.