8-K 1 body8k.htm 8-K December 17, 2020 8K DOC


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 11, 2020

Seelos Therapeutics, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada

 

000-22245

 

87-0449967

(State or Other Jurisdiction of Incorporation)

 

(Commission File Number)

 

(I.R.S. Employer Identification No.)

 

300 Park Avenue, 12th Floor, New York, NY

 

10022

(Address of principal executive offices)

 

(Zip Code)

Registrant's telephone number, including area code: (646) 293-2100

Not Applicable
(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:

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities Registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 par value

SEEL

The Nasdaq Stock Market LLC

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      o     

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.      o     



Item 1.01.    Entry into a Material Definitive Agreement.

On December 11, 2020, Seelos Therapeutics, Inc. (the "Company") entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with Lind Global Asset Management II, LLC (the "Investor") pursuant to which, among other things, on December 11, 2020, the Company issued and sold to the Investor, in a private placement transaction (the "Private Placement"), in exchange for the payment by the Investor of $10,000,000, (1) a convertible promissory note (the "Note") in an aggregate principal amount of $12,000,000 (the "Principal Amount"), which will bear no interest and mature on December 11, 2022 (the "Maturity Date"), and (2) 975,000 shares (the "Closing Shares") of common stock of the Company, par value $0.001 per share ("Common Stock").

At any time following June 11, 2021, and from time to time before the Maturity Date, the Investor shall have the option to convert any portion of the then-outstanding Principal Amount of the Note into shares of Common Stock at a price per share of $1.60, subject to adjustment for stock splits, reverse stock splits, stock dividends and similar transactions (the "Conversion Price"). Prior to June 11, 2021, the Company shall have the right to prepay up to sixty-six and two-thirds percent (662/3%) of the then-outstanding Principal Amount of the Note with no penalty. On or after July 11, 2021, the Company shall have the right to prepay up to the then-outstanding Principal Amount of the Note with no penalty; however, if the Company exercises such prepayment right, the Investor will have the option to convert up to thirty-three and one-third percent (331/3%) of the amount that the Company elects to prepay at the Conversion Price.

The Company intends to use the proceeds from the Private Placement for general corporate purposes and to advance the development of its product candidates.

Subject to certain exceptions, the Company will be required to direct proceeds from any subsequent debt financings (including subordinated debt, convertible debt or mandatorily redeemable preferred stock but other than purchase money debt or capital lease obligations or other indebtedness incurred in the ordinary course of business) to repay the Note, unless waived by the Investor in advance.

Beginning on June 9, 2021, the Note will amortize in eighteen monthly installments equal to the quotient of (i) the then-outstanding Principal Amount of the Note, divided by (ii) the number of months remaining until the Maturity Date. All amortization payments shall be payable solely in cash, plus a 2% premium.

In conjunction with the Securities Purchase Agreement and the Note, on December 11, 2020, the Company and the Investor entered into a security agreement (the "Security Agreement"), which provides the Investor with a first priority lien on the Company's assets and properties.

Until December 11, 2021, the Investor will, subject to certain exceptions, have the right to participate for up to 10% of any Common Stock equity financing of the Company.

The Securities Purchase Agreement contains customary representations and warranties of the Company and the Investor. In addition, the Note contains restrictive covenants and event of default provisions that are customary for transactions of this type.

The foregoing summaries of the Securities Purchase Agreement, the Note and the Security Agreement do not purport to be complete and are qualified in their entirety by reference to the copies of the Securities Purchase Agreement and Form of Note filed herewith as Exhibits 10.1, 4.1 and 10.2, respectively.

The representations, warranties and covenants contained in the Securities Purchase Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to the Securities Purchase Agreement, and may be subject to limitations agreed upon by the contracting parties. Accordingly, the Securities Purchase Agreement is incorporated herein by reference only to provide investors with information regarding the terms of the Securities Purchase Agreement, and not to provide investors with any other factual information regarding the Company or its business, and should be read in conjunction with the disclosures in the Company's periodic reports and other filings with the Securities and Exchange Commission (the "SEC").


Item 2.03.    Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference into this Item 2.03.

Item 3.02.    Unregistered Sales of Equity Securities.

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference into this Item 3.02.

The Note, the Closing Shares and the shares of Common Stock issuable pursuant to the Note (collectively, the "Securities") were offered and sold to the Investor on December 11, 2020 in a transaction exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), in reliance on Section 4(a)(2) thereof and Rule 506(b) of Regulation D thereunder. The Investor represented that it was an "accredited investor," as defined in Regulation D, and was acquiring the Securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. Accordingly, the Securities have not been registered under the Securities Act and the 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.

Neither this Current Report on Form 8-K nor the exhibits attached hereto is an offer to sell or the solicitation of an offer to buy shares of Common Stock, notes or any other securities of the Company.

Item 9.01.    Financial Statements and Exhibits.

(d) Exhibits.

     

Number

  

Description

 

 

4.1+

  

Form of Convertible Promissory Note due December 11, 2022.

 

 

10.1+

  

Securities Purchase Agreement, dated as of December 11, 2020, by and between Seelos Therapeutics, Inc. and Lind Global Asset Management II, LLC.

 

 

10.2

  

Security Agreement, dated as of December 11, 2020, by and between Seelos Therapeutics, Inc. and Lind Global Asset Management II, LLC.

 

 

+

  

Non-material schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish supplemental copies of any of the omitted schedules and exhibits upon request by the SEC.


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.

 

Seelos Therapeutics, Inc.

 

 

 Date: December 17, 2020

By:

/s/ Raj Mehra, Ph.D.

 

 

 

Name: Raj Mehra, Ph.D.

 

 

 

Title: Chief Executive Officer, President and Interim Chief Financial Officer