tbuff_8k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of
report (Date of earliest event reported): November 9, 2017
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CORMEDIX
INC.
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(Exact
Name of Registrant as Specified in Charter)
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Delaware
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001-34673
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20-5894890
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(State
or Other Jurisdictionof Incorporation)
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(CommissionFile
Number)
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(IRS
EmployerIdentification No.)
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400
Connell Drive, Suite 5000, Berkeley Heights, NJ
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07922
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
Telephone Number, Including Area Code: (908) 517-9500
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(Former
Name or Former Address, If Changed Since Last Report)
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Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
☐
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
☐
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
☐
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
☐
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).
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. ☐
Item 1.01. Entry into a Material Definitive Agreement.
On
November 9, 2017, we entered into a securities purchase agreement
with Elliott Associates, L.P. and Elliott International, L.P., (the
“Buyers”), long-term institutional investors in
CorMedix, pursuant to which we have agreed to sell $2 million of
newly designated Series F Convertible preferred stock
(“Series F Stock”) at $1,000 per share.
On
November 9, 2017, we also entered a backstop agreement with the
Buyers pursuant to which the Buyers have agreed to purchase from
us, at our request, up to an additional $3 million of shares of the
Series F Stock at $1,000 per share. We may request purchases under
the backstop agreement from January 15, 2018 until March 31,
2018.
As
consideration for the backstop financing, we will issue the Buyers
warrants, exercisable for three years, to purchase, in the
aggregate, up to 947,329 shares (subject to adjustment) of CorMedix
common stock at a per share exercise price of $0.001. The number of
shares issuable under the warrant was determined by the closing
price of CorMedix Common Stock on November 8, 2017, which was
$0.5278. The number of
shares issuable under the warrants will be reduced to the extent
that we raise equity capital from investors other than the Buyers
that offsets the $3 million backstop amount.
Gross
proceeds of the securities purchase agreement and the backstop
agreement, if the backstop agreement is used in full, total an
aggregate of $5,000,000 (assuming cashless exercise of the
warrants).
Each
share of Series F Stock is convertible into shares of our common
stock, at the option of the Buyers, at an effective price of
$0.6334 per share, which represents a 20% premium to the closing
price of our common stock on November 8, 2017. The conversion
price of the Series F Stock is subject to anti-dilution adjustment
for customary recapitalization events such as stock splits, as well
as full ratchet anti-dilution protection in the event that we do
not obtain the subordination of the Series C-3 preferred stock to
that of the Series F Stock (as described below) or obtain
stockholder approval of the issuance of common stock that exceeds
NYSE American rules (as described below). The Series F Stock
will be mandatorily convertible on April 2, 2018, subject to
certain equity conditions, at the lower of $0.6334 and a 10%
discount to the notional price at which an equity or equity linked
transaction in an amount of $5 million or more is completed by
March 31, 2018, or if no such transaction is completed, a 10%
discount to the closing price of the stock on March 31,
2018.
The
Series F Stock is non-voting and has no dividend right outside of
receiving dividends in the same form as we pay to holders of shares
of our common stock.
The
Series F Stock contains a prohibition on its conversion if, as a
result of such conversion, we would have issued shares of our
common stock in an aggregate amount equal to 13,336,939 shares,
which is 20% of our shares of common stock outstanding on November
9, 2017, unless we have received the approval of our stockholders
for such overage.
The
Buyers will be prohibited from converting Series F Stock into
shares of our common stock to the extent that, as a result of such
conversion, the Buyers, together with their affiliates, would own
more than 9.99% of the total number of shares of our common stock
then issued and outstanding. In the event of our liquidation,
dissolution, or winding up, holders of the Series F Stock will
receive a payment equal to $1,000 per share of Series F Stock,
subject to adjustment, before any proceeds are distributed to the
holders of common stock. Shares of the Series F Stock will
rank:
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senior to all
common stock and the Series C-2, Series C-3 Convertible Preferred
Stock (subject to the us obtaining any consent, waiver or other
authorization from the holders of the Series C-3 Convertible
Preferred Stock necessary for the subordination of the Series C-3
Convertible Preferred Stock to the Series F Preferred Stock),
Series D Non-Voting Convertible Preferred Stock, Series E
Non-Voting Convertible Stock; and
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senior to any class
or series of capital stock hereafter created.
in each
case, as to distributions of assets upon our liquidation,
dissolution or winding up whether voluntarily or
involuntarily.
We
currently anticipate that closing of the sale of the Series F Stock
and the warrants will take place on or about November 16, 2017,
subject to the satisfaction of customary closing
conditions.
As a
part of the financing, we will also enter into a registration
rights agreement with the Buyers whereby the Buyers can demand that
we register the shares issuable upon exercise of the warrants, and
shares issuable upon conversion of the Series F Stock, if
issued.
No
placement agent or underwriter was involved in the
offerings.
We
intend to use the net proceeds of the offerings for general
corporate purposes, working capital and capital
expenditures.
The
certificate of designation, form of warrant, form of securities
purchase agreement, form of backstop agreement, and registration
rights agreement, are filed herewith as Exhibits 3.15, 4.15, 10.1,
10.2 and 10.3, respectively, and are incorporated herein by
reference. The foregoing descriptions of the Series F Stock, the
securities purchase agreement, the backstop agreement, the
warrants, and the registration rights agreement are not complete
and are qualified in their entirety by reference to the respective
exhibits.
The
Series F Stock and the warrants to be issued will be sold in a
transaction exempt from registration under the Securities Act of
1933, as amended, in reliance on Section 4(a)(2) thereof. Neither
the Series F Stock nor the warrants may be offered or sold in the
United States absent registration or exemption from registration
under the Securities Act and any applicable state securities
laws.
The
information contained in this Current Report on Form 8-K is not an
offer to sell or the solicitation of an offer to buy the Series F
Stock or the warrants or any other securities of our
company.
A copy
of the press release regarding the above matters is attached hereto
as Exhibit 99.1.
Item 3.02 Unregistered Sales of Equity Securities.
The information contained in Item 1.01 is incorporated herein by
reference.
Item 5.03 Amendment to Articles of Incorporation or Bylaws; Change
in Fiscal Year.
On November 9, 2017, we filed a Certificate of Designation of
Series F Stock with the Delaware Secretary of State classifying and
designating the rights, preferences and privileges of the Series F
Stock. The Series F Stock Certificate of Designation is attached
hereto as Exhibit 3.15 and is incorporated herein by
reference.
The description of the Series F Stock contained in Item 1.01 is
incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
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Exhibit
No.
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Description
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Certificate of
Designation of Series F Preferred Stock of CorMedix Inc., filed
with the Delaware Secretary of State on November 9,
2017.
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Form
of Warrant.
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Securities
Purchase Agreement, dated November 9, 2017, between CorMedix Inc.
and the investors named therein.
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Backstop
Agreement, dated November 9, 2017, between CorMedix Inc. and the
investor named therein.
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Form
of Registration Rights Agreement, dated November 9, 2017, by and
between CorMedix Inc. and the investor named therein.
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Press
release dated November 9, 2017.
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SIGNATURE
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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Date:
November 13, 2017 |
CORMEDIX
INC.
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By:
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/s/
Robert
W. Cook
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Name: Robert
W. Cook
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Title:
Chief Financial Officer |
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