Item 1.01
|
Entry into a Material Definitive Agreement.
|
On March 2, 2021, Navidea Biopharmaceuticals, Inc. (the “Company”) entered into a Stock Purchase Agreement and Letter of Investment Intent (the “Purchase Agreement”) with an existing accredited investor, John K. Scott, Jr. (“Investor”) pursuant to which the Company issued to Investor in a private placement transaction 50,000 shares of newly-designated Series E Redeemable Convertible Preferred Stock (the “Transaction Shares”) for an aggregate purchase price of $5,000,000. The Transaction Shares have the rights set forth in the Series E Preferred Certificate (as defined below).
Under the Purchase Agreement, Investor was granted a right of first offer with respect to future issuances of Company securities (the “Right of First Offer”); provided, however, that in no event shall Investor have such right if the acquisition of any of such securities would result in Investor beneficially holding more than thirty three and one-third percent (33.33%) of the Company’s outstanding common stock, par value $0.001 per share (“Common Stock”) on an as-converted basis, as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules thereunder (the “Share Cap”). In the event that Investor does not exercise the Right of First Offer, the Company will then be entitled to offer and sell the new securities to any third party at a price not less than, and upon terms no more favorable to the offeree than, those offered to Investor (a “Third Party Offering”).
Pursuant to the Purchase Agreement, Investor also has the option to purchase up to thirty three and one-third percent (33.33%) of the new securities offered in a Third-Party Offering at the same price and upon the terms available to the other purchaser(s) (the “Preemptive Right”); provided, however, that in no event may Investor acquire new Company securities in a Third-Party Offering to the extent the acquisition thereof would violate the Share Cap.
The Right of First Offer and the Preemptive Right will expire upon the earlier of (i) December 31, 2021 or (ii) upon the voluntary or involuntary liquidation, dissolution, or winding up of the Company.
In connection with the private placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”), pursuant to which, among other things, the Company will prepare and file with the Securities and Exchange Commission (the “SEC”) one or more registration statements to register for resale the maximum number of Conversion Shares (as defined below) issuable upon conversion of the Transaction Shares. In the event that both (i) the number of shares of Common Stock beneficially held by Investor falls below twenty percent (20%) of the outstanding Common Stock on an as-converted basis, as determined in accordance with Section 13(d) of the Exchange Act and the rules thereunder and (ii) Investor is an affiliate (as that term is defined under Rule 144) at the time of the Reload Request (as defined below), the Company, upon written request from Investor (the “Reload Request”), will be required prepare and file with the SEC one, and only one, additional registration statement covering the resale of those shares of Common Stock owned by Investor as of the date of the Reload Request that, as of such time, are not registered for resale under the Securities Act of 1933, as amended (the “Securities Act”).
The securities issued in the offering have not been registered under the Securities Act, and until so registered the securities may not be offered or sold absent registration or availability of an applicable exemption from registration.
The foregoing description of the material terms of the Purchase Agreement and the Registration Rights Agreement are qualified in their entirety by reference thereto, which are filed as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K, and are incorporated herein by reference.
A press release announcing the transaction is attached hereto as Exhibit 99.1, and is incorporated herein by reference.