UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
Securities Purchase Agreements
Effective on December 18th and 19th, 2024, Mangoceuticals, Inc., a Texas corporation (the “Company”, “we” and “us”), agreed to definitive terms on Securities Purchase Agreements (the “SPAs”), with certain institutional accredited investors (the “Purchasers”), pursuant to which the Company sold the Purchasers, and the Purchasers purchased from the Company, 250 shares of Series B Convertible Preferred Stock of the Company (“Series B Preferred Stock”) for $250,000, and warrants to purchase 330,000 shares of common stock (the “Warrants”, and the shares of common stock issuable upon exercise thereof, the “Warrant Shares”), with an exercise price of $2.71 per share, and 100 shares of Series B Preferred Stock for $100,000, and Warrants to purchase 132,000 shares of common stock with an exercise price of $2.57 per share, respectively.
The Company anticipates selling up to an additional $900,000 of shares of Series B Preferred Stock and 1,188,000 Warrants on similar terms as the SPAs.
The SPAs provide that until the 18th month anniversary of the applicable closing date, the Purchasers have the right to participate in any issuance by the Company or any of its subsidiaries of common stock or common stock equivalents or any offering of debt or any other type of financing, or a combination thereof (other certain customary exempt issuances)(each a “Subsequent Financing”), in an amount not to exceed the amount of the Purchaser’s subscription, on the same terms, conditions and price provided for in the Subsequent Financing.
The Company has reserved from its duly authorized capital stock 3,000,000 shares of common stock issuable upon exercise of the Warrants and conversion of the Series B Preferred Stock.
The SPAs contain customary representations, warranties and covenants by the Company (including a restriction on entering into any variable rate transaction for a period of 180 days from the applicable closing date), customary conditions to closing, indemnification obligations of the Company and the Purchasers, other obligations of the parties and termination provisions.
This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation to buy nor shall there be any sale of securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
The terms of the Company’s Series B Preferred Stock are described in greater detail in the Current Reports on Form 8-K filed with the Securities and Exchange Commission (SEC) on April 11, 2024 and July 2, 2024, which description is incorporated by reference herein.
Warrants
In connection with the December 18, 2024 and December 19, 2024, closings under the SPAs, the Company issued the Purchasers Warrants to purchase up to 462,000 shares of common stock. The exercise price of the Warrants as discussed above (as applicable, the “Exercise Price”), are equal to one hundred and five percent (105%) of the 10-trading day average volume weighted average price of the Company’s common stock calculated on the trading day immediately preceding the applicable closing. The Exercise Price is subject to adjustment in the event of customary stock splits, stock dividends, combinations or similar events. If at any time following the Initial Exercise Date (as defined below) of the Warrants, there is no effective registration statement registering, or the prospectus contained therein is not available for the shares of common stock issuable upon exercise of the Warrants, the Warrants can be exercised on a cashless basis as described in greater detail in the Common Share Purchase Warrants entered into to evidence the Warrants (the “Warrant Agreements”).
The Warrants are exercisable on or after 180 days from their grant date (“Initial Exercise Date”), and for five years thereafter.
The Warrants contain provisions that prohibit exercise if the holder thereof, together with its affiliates, would beneficially own in excess of 4.99% of the number of the Company’s shares of common stock outstanding immediately after giving effect to such exercise. A holder of the Warrants may increase or decrease this percentage, but not in excess of 9.99%, by providing at least 61 days’ prior notice to the Company. In the event of certain corporate transactions, a holder of the Warrants will be entitled to receive, upon exercise of the Warrants, the kind and amount of securities, cash or other property that the holder would have received had it exercised the Warrants immediately prior to such transaction.
If the Company or any subsidiary at any time while the Warrants are outstanding, shall sell, enter into an agreement to sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any option to purchase or other disposition) any common stock or common stock equivalents, at an effective price per share less than the exercise price of the Warrants then in effect (such lower price, the “Base Share Price” and such issuances collectively, a “Dilutive Issuance”) then simultaneously with the consummation (or, if earlier, the announcement) of each Dilutive Issuance the exercise price shall be reduced and only reduced to equal the Base Share Price. No adjustment however is to be made for certain customary Exempt Issuances (as defined in the SPAs).
The Warrants also include customary buy-in rights in the event the Company fails to timely deliver the shares of common stock issuable upon exercise thereof.
If at any time the Warrants are outstanding there occurs any share split, share dividend, share combination recapitalization or other similar transaction involving the common stock (each, a “Share Combination Event”, and such date thereof, the “Share Combination Event Date”) and the Event Market Price (defined below) is less than the then exercise price then in effect, then on the sixth trading day immediately following such Share Combination Event Date, the exercise price then in effect on such sixth trading day is automatically reduced (but in no event increased) to the Event Market Price. The “Event Market Price” means, with respect to any Share Combination Event Date, the quotient determined by dividing (x) the sum of the volume weighted average price of the common stock for each of the five trading days ending and including the trading day immediately preceding the sixth trading day after such Share Combination Event Date, divided by (y) five.
The foregoing description of the SPAs, Warrants, and Series B Preferred Stock, is only a summary of the material terms of such agreements/filings and does not purport to be complete and is qualified in its entirety by reference to the full text of such agreements/filings, which are filed (or incorporated by reference) as Exhibits 10.1, 4.1, 3.1, and 3.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities.
The information set forth in Item 1.01 above is incorporated herein by reference.
The issuance of the Series B Preferred Stock and the Warrants, as discussed above, were each exempt from registration pursuant to an exemption from registration provided by Section 4(a)(2), and/or Rule 506 of Regulation D of the Securities Act, since the foregoing issuances did not involve a public offering, the recipients took the securities for investment and not resale, we took appropriate measures to restrict transfer, and the recipients were each (a) an “accredited investor”; and/or (b) had access to similar documentation and information as would be required in a Registration Statement under the Securities Act of 1933, as amended (the “Securities Act”). The securities are subject to transfer restrictions, and the securities contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom. The securities were not registered under the Securities Act and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws.
If the Series B Preferred Stock shares were converted in full, without factoring in any dividends which can be paid in-kind, a maximum of 171,112 shares of common stock would be due to the holder thereof, based on a Floor Price of $2.25 per share.
If the Warrants issued to the Purchasers on December 18, 2024 and December 19, 2024, were exercised in full, a maximum of 462,000 shares of common stock would be due to the holder thereof.
Item 9.01 Exhibits.
(d) Exhibits.
* Filed herewith.
# Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2)(ii) of Regulation S-K. A copy of any omitted schedule or Exhibit will be furnished supplementally to the Securities and Exchange Commission upon request; provided, however that Mangoceuticals, Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or Exhibit so furnished.
£ Represents management contract or compensatory plan or arrangement.
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.
| MANGOCEUTICALS, INC. | ||
| Date: December 26, 2024 | By: | /s/ Jacob D. Cohen |
| Jacob D. Cohen | ||
| Chief Executive Officer | ||