Current Report Filing (8-k)
June 28 2018 - 9:07AM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 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): June 27, 2018
CELSION
CORPORATION
(Exact
Name of Registrant as Specified in Charter)
Delaware
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001-15911
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52-1256615
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(State
or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification No.)
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997
Lenox Drive, Suite 100
Lawrenceville,
NJ 08648
Registrant’s
telephone number, including area code: (609) 896-9100
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:
[ ]
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ]
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate
by check mark whether the registrant is an emerging growth company as defined in 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.
Please
see the disclosure set forth under “Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant,” which is incorporated by reference into this Item 1.01.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On
June 27, 2018, Celsion Corporation, a Delaware corporation (“Celsion”), entered into a loan agreement with Horizon
Technology Finance Corporation (“Horizon”) that provides $10 million in new capital (the “Horizon Credit Agreement”).
Celsion drew down $10 million upon closing of the Horizon Credit Agreement on June 27, 2018. The Company anticipates that it will
use the funding provided under the Horizon Credit Agreement for working capital and advancement of its product pipeline including
ThermoDox® for the treatment of hepatocellular carcinoma (“HCC”) and GEN-1 for the treatment of newly diagnosed
ovarian cancer, as well as other strategic initiatives designed to broaden its development pipeline.
The
obligations under the Horizon Credit Agreement are secured by a first-priority security interest in substantially all assets of
Celsion other than intellectual property assets. The obligations will bear interest at a rate calculated based on one-month LIBOR
plus 7.625%. Payments under the loan agreement are interest only for the first twenty-four (24) months after loan closing, followed
by a 24-month amortization period of principal and interest through the scheduled maturity date.
As
a fee in connection with the Horizon Credit Agreement, Celsion issued Horizon warrants exercisable for a total of 190,114 shares
of Celsion’s common stock (the “Warrants”) at a per share exercise price of $2.63. The Warrants are immediately
exercisable for cash or by net exercise from the date of grant and will expire after ten years from the date of grant. Following
the date of grant and within 90 days, Celsion is required to register the common stock underlying the Warrants.
The
Horizon Credit Agreement contains customary representations, warranties and affirmative and negative covenants
including, among other things, covenants that limit or restrict Celsion’s ability to grant liens, incur indebtedness,
make certain restricted payments, merge or consolidate and make dispositions of assets. Upon the occurrence of an event of
default under the Horizon Credit Agreement, the lenders may cease making loans, terminate the Horizon Credit Agreement,
declare all amounts outstanding to be immediately due and payable and foreclose on or liquidate Celsion’s assets that
comprise the lenders’ collateral. The Horizon Credit Agreement specifies a number of events of default (some of which
are subject to applicable grace or cure periods), including, among other things, non-payment defaults, covenant defaults, a
material adverse effect on Celsion or its assets, cross-defaults to other material indebtedness, bankruptcy and insolvency
defaults and material judgment defaults.
The
foregoing description of the Horizon Credit Agreement does not purport to be complete and is qualified in its entirety by reference
to the Horizon Credit Agreement, a copy of which the Company intends to file as an exhibit to its Quarterly Report on Form 10-Q
for the quarter ending June 30, 2018.
Item
3.02 Unregistered Sales of Equity Securities.
Please
see the disclosure set forth under “Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant” regarding the Warrant, which is incorporated by reference into this Item 3.02.
The
purchase and issuance of the Warrant occurred concurrent with the closing of the Horizon Credit Facility and no separate consideration
was paid for the Warrant.
The
Warrants have not been registered under the Securities Act of 1933, as amended, and was issued pursuant to the exemptions from
registration provided by Section 4(2) of the Securities Act of 1933 and/or Regulation D promulgated thereunder. The shares issued
or issuable thereunder are restricted in accordance with Rule 144 under the Securities Act of 1933. The issuances and the potential
issuances did not involve any public offering; the Company made no solicitation in connection with the private placement other
than communications with the purchasers; the Company obtained representations from the purchasers regarding their investment intent,
knowledge and experience; the purchasers either received or had access to adequate information about the Company in order to make
informed investment decisions; the Company reasonably believed that the purchasers are capable of evaluating the merits and risks
of their investment; and the shares potentially issuable thereunder are issuable with restricted securities legends.
This
current report on Form 8-K does not constitute an offer to sell or the solicitation of an offer to buy any security. The Warrant
and the shares issued upon exercise thereof have not been registered under the Securities Act of 1933 or applicable state securities
laws and may not be offered or sold in the United States or any state thereof absent registration under the Securities Act and
applicable state securities laws or an applicable exemption from registration requirements.
Safe
Harbor Statement
This
Current Report on Form 8-K contains forward-looking statements. Actual results and the timing of events could differ materially
from those anticipated in such forward-looking statements as a result of risks and uncertainties including, without limitation,
Horizon may not issue additional loan tranches and has no obligation to issue them; Celsion may be unable to find suitable assets
or companies to acquire on attractive terms; any failure to satisfy the closing conditions of subsequent borrowings of the credit
facility; any increase in Celsion’s cash needs; unforeseen changes in the course of Celsion’s research and development
activities and clinical trials; possible actions by customers, suppliers, competitors or regulatory authorities; and other risks
detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission. Celsion
undertakes no obligation to update any forward-looking statement, whether written or oral, that may be made from time to time,
whether as a result of new information, future developments or otherwise.
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.
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CELSION CORPORATION
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June
28, 2018
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By:
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/s/
Jeffrey W. Church
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Jeffrey
W. Church
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Senior
Vice President and Chief Financial Officer
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