Current Report Filing (8-k)
December 11 2018 - 3:07PM
Edgar (US Regulatory)
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): December 7,
2018
Tenax
Therapeutics, Inc.
(Exact
name of registrant as specified in its charter)
Delaware
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001-34600
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26-2593535
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(State
or other jurisdiction of incorporation)
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(CommissionFile
Number)
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(IRS
EmployerIdentification No.)
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ONE Copley Parkway, Suite 490
Morrisville, NC 27560
(Address
of principal executive offices) (Zip Code)
919-855-2100
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
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:
☐
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 (17 CFR
230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17
CFR 240.12b-2).
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 December 7, 2018, Tenax Therapeutics, Inc. (the
“Company”) entered into an underwriting agreement (the
“Underwriting Agreement”) with Ladenburg
Thalmann & Co. Inc. (the “Underwriter”),
pursuant to which the Company agreed to issue and sell, in an
underwritten offering by the Company (the “Offering”),
5,181,346 units (the “Units”), with each Unit
consisting of (a) one share of Series A convertible preferred
stock, par value $0.0001 per share (the “Series A Preferred
Stock”), (b)
a two-year warrant to
purchase one share of common stock, exercisable at a price of $1.93
(the “Series 1 Warrants”), and (c) a five-year warrant
to purchase one share of common stock, exercisable at a price of
$1.93 (the “Series 2 Warrants” and collectively with
the Series 1 Warrants, the
“Warrants”)
, with
each Unit to be offered at an offering price of $1.93 per Unit. The
initial conversion price of the Series A Preferred Stock is $1.93
per share. The Company agreed to pay the Underwriter an aggregate
fee equal to 8.0% of the gross proceeds received in the Offering
and to reimburse the Underwriter for up to $95,000 of expenses
incurred by the Underwriter in connection with the Offering. The
Offering closed on December 11, 2018.
The Units were offered by the Company pursuant to a registration
statement
on Form S-1 (File No. 333-228212), as
amended, as initially filed with the Securities and Exchange
Commission (the “Commission”) on November 6, 2018 and
declared effective by the Commission on December 7, 2018 (the
“Registration Statement”).
The Series A Preferred Stock has full ratchet price-based
anti-dilution protection as described further below. The exercise
price of the warrants is fixed and the warrants do not contain any
variable pricing features or any price-based anti-dilutive
features. The securities comprising the Units are immediately
separable and have been issued separately. The conversion price of
the Series A Preferred Stock and exercise price of the warrants is
subject to appropriate adjustment in the event of recapitalization
events, stock dividends, stock splits, stock combinations,
reclassifications, reorganizations or similar events affecting the
Company’s common stock.
The net proceeds to the Company from the Offering, after deducting
Underwriter fees and expenses and the Company’s estimated
Offering expenses, and excluding the proceeds, if any, from the
exercise of the Warrants issued in the Offering, are expected to be
approximately $9 million. The Company currently intends
to use the net proceeds of the Offering to further its clinical
trials and efforts to obtain regulatory approval of levosimendan,
for research and development and for general corporate purposes,
including working capital and potential acquisitions.
The Underwriting Agreement contains representations and warranties
that the parties made to, and solely for the benefit of, the other
in the context of all of the terms and conditions of that agreement
and in the context of the specific relationship between the
parties. The provisions of the Underwriting Agreement,
including the representations and warranties contained therein, are
not for the benefit of any party other than the parties to such
agreements and are not intended as documents for investors and the
public to obtain factual information about the current state of
affairs of the parties to those documents and agreements. Rather,
investors and the public should look to other disclosures contained
in the Company’s filings with the Commission.
The Company also entered into a warrant agency agreement with
Direct Transfer LLC, who will act as warrant agent for the Company,
setting forth the terms and conditions of the Warrants sold in the
Offering (the “Warrant Agency Agreement”).
The foregoing summaries of the terms of the Underwriting Agreement,
the form of Warrants, and the Warrant Agency Agreement are subject
to, and qualified in their entirety by reference to, the
Underwriting Agreement, the form of Warrants and the Warrant Agency
Agreement which are filed as Exhibits 1.1, 4.3 and 4.4,
respectively, to this Current Report on Form 8-K (this
“Report”) and are incorporated herein by
reference.
Item 3.02 Unregistered Sales of Equity Securities.
Under
the terms of the Underwriting Agreement, upon closing of the
Offering on December 11, 2018, the Company issued to the
Underwriter a five-year warrant (the “Representative
Warrant”) to purchase 207,253 shares of the Company’s
common stock, which is equal to 4% of the aggregate number of
shares of common stock issuable upon conversion of the Series A
Preferred Stock, as partial compensation for the
Underwriter’s services in connection with the Offering. The
Representative Warrant has an exercise price of $2.4125 per share,
which is equal to 125% of the offering price for the Units sold in
the Offering. Pursuant to FINRA Rule 5110(g), the Representative
Warrants and any shares issued upon exercise of the Representative
Warrant shall not be sold, transferred, assigned, pledged, or
hypothecated, or be the subject of any hedging, short sale,
derivative, put or call transaction that would result in the
effective economic disposition of the securities by any person for
a period of 180 days immediately following the date of
effectiveness or commencement of sales of the Offering, except for
transfers in certain limited circumstances.
The
Representative Warrant was issued in a private placement
transaction exempt from registration in reliance on Section 4(a)(2)
of the Securities Act of 1933, as amended (the “Securities
Act”), as a transaction by an issuer not involving any public
offering.
The
foregoing summary of the terms of the Representative Warrant is
subject to, and qualified in its entirety by reference to the
Representative Warrant which is filed as Exhibit 4.2 to this Report
and incorporated herein by reference.
Item 3.03 Material Modification to Rights of Security
Holders.
To the
extent required by Item 3.03 of Form 8-K, the information
contained in Item 5.03 of this Report is incorporated herein by
reference.
Item 5.03 Amendments to Articles of Incorporation or
Bylaws; Change in Fiscal Year.
In connection with the Offering, the Company filed a Certificate of
Designation of Preferences, Rights and Limitations of the Series A
Preferred Stock (the “Certificate of Designation”) on
December 10, 2018, with the Secretary of State of the State of
Delaware which became effective upon filing.
The Series A
Preferred Stock issued under the Certificate of Designation has no
dividend rights (except to the extent that dividends are also paid
on the common stock), liquidation preference or other preferences
over common stock, and has no voting rights, except in certain
limited situations.
Each share of Series A Preferred Stock is convertible, subject to
the beneficial ownership limitation, at any time at the
holder’s option into one share of common stock (based on a
stated value of $1.93 per share of Series A Preferred Stock and a
conversion price of $1.93) which conversion ratio will be subject
to adjustment in the event of recapitalization events, stock
dividends, stock splits, stock combinations, reclassifications,
reorganizations or similar events affecting the Company’s
common stock as specified in the Certificate of Designation.
Notwithstanding the foregoing, the Certificate of Designation
further provides that the Company shall not effect any conversion
of Series A Preferred Stock, with certain exceptions, to the extent
that, after giving effect to an attempted conversion, the holder of
Series A Preferred Stock (together with such holder’s
affiliates, and any persons acting as a group together with such
holder or any of such holder’s affiliates) would beneficially
own a number of shares of common stock in excess of 4.99% (or, at
the election of the holder prior to the issuance date, 9.99%) of
the shares of common stock then outstanding after giving effect to
such exercise. At the holder’s option, upon notice to the
Company, the holder may increase or decrease this beneficial
ownership limitation not to exceed 9.99% of the shares of common
stock then outstanding, with any such increase becoming effective
upon 61 days’ prior notice to the Company.
Until such time as 85% of the aggregate shares of Series A
Preferred Stock issued to all holders on the original issue date
have been converted to common stock, the Series A Preferred Stock
has full ratchet price-based anti-dilution protection, subject to
customary carve outs, in the event of a down-round financing at a
price per share below the conversion price of the Series A
Preferred Stock. If during any 30 consecutive trading days the
volume weighted average price of the Company’s common stock
exceeds 300% of the then-effective conversion price of the Series A
Preferred Stock and the daily dollar trading volume for each
trading day during such period exceeds $175,000, the anti-dilution
protection in the Series A Preferred Stock will expire and cease to
apply.
Additionally,
subject to certain exceptions, at any time after the issuance of
the Series A Preferred Stock, and subject to the beneficial
ownership limitation, the Company will have the right to cause each
holder of the Series A Preferred Stock to convert all or part of
such holder
’
s Series A
Preferred Stock in the event that (i) the volume weighted average
price of our common stock for any 30 consecutive trading days (the
“Measurement Period”)
,
exceeds 300% of the initial conversion
price of the Series A Preferred Stock (subject to adjustment for
forward and reverse stock splits, recapitalizations, stock
dividends and similar transactions), (ii) the average daily trading
volume for such Measurement Period exceeds $175,000 per trading day
and (iii) the holder is not in possession of any information that
constitutes or might constitute, material non-public information
which was provided by the Company. The Company’s right to
cause each holder of the Series A Preferred Stock to convert all or
part of such holder
’
s
Series A Preferred Stock shall be exercised ratably among the
holders of the then outstanding preferred
stock.
The terms of the Series A Preferred Stock are set forth in the
Certificate of Designation, and the foregoing summary of the terms
of the Certificate of Designation is subject to, and qualified in
its entirety by reference to, the Certificate of Designation which
is filed as Exhibit 4.1 to this Report and is incorporated herein
by reference.
Item 8.01 Other Events.
On December 11, 2018, the Company announced the closing of the
Offering. A copy of the press release announcing these events is
attached as Exhibit 99.1 to this Report and is hereby incorporated
herein by reference.
Following the completion of the Offering, as of 4:00 p.m. New York
City time on December 11, 2018, the Company had outstanding
3,017,249 shares of common stock (which includes 1,551,753 shares
of common stock issued upon conversion of shares of the Series A
Preferred Stock) and 3,629,593 shares of Series A Preferred
Stock.
Item
9.01
Financial
Statements and Exhibits.
Exhibit No.
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Description
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Underwriting
Agreement dated as of December 7, 2018 by and between Tenax
Therapeutics, Inc. and Ladenburg Thalmann & Co.
Inc.
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Certificate
of Designation of Series A Convertible Preferred Stock
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Representative’s
Warrant to Purchase Shares of Common Stock
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Form of
Warrant to Purchase Shares of Common Stock
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Warrant
Agency Agreement
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Press
Release dated December 11, 2018
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SIGNATURES
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.
Date: December 11, 2018
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Tenax Therapeutics, Inc.
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By:
/
s
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Michael B. Jebsen
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Michael
B. Jebsen
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President
and Chief Financial Officer
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