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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):
January 10, 2022
Celsion
Corporation
(Exact
Name of Registrant as Specified in Charter)
|
Delaware |
|
001-15911 |
|
52-1256615 |
|
(State
or Other Jurisdiction
of
Incorporation)
|
|
(Commission
File
Number)
|
|
(IRS
Employer
Identification
No.)
|
|
997 Lenox Drive,
Suite 100,
Lawrenceville,
NJ |
|
08648 |
| (Address of Principal Executive
Offices) |
|
(Zip
Code) |
(609)
896-9100
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 (see General Instruction A.2.
below):
|
|
☐ |
Written
communication 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
communication pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b)) |
| |
|
|
| |
☐ |
Pre-commencement
communication 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, par value $0.01 per share |
|
CLSN |
|
Nasdaq Capital Market |
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
☐
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 January 10, 2022, Celsion Corporation, a Delaware Corporation
(the “Company”), entered into a Securities Purchase Agreement (the
“Purchase Agreement”) with several institutional investors,
pursuant to which the Company agreed to issue and sell, in
concurrent registered direct offerings (the “Offerings”), (i)
50,000 shares of the Company’s Series A Convertible Redeemable
Preferred Stock, par value $0.01 per share (the “Series A Preferred
Stock”), and (ii) 50,000 shares of the Company’s Series B
Convertible Redeemable Preferred Stock, par value $0.01 per share
(the “Series B Preferred Stock” and together with the Series A
Preferred Stock, the “Preferred Stock”), in each case at an
offering price of $285 per share, representing a 5% original issue
discount to the stated value of $300 per share, for gross proceeds
of each Offering of $14.25 million, or approximately $28.50 million
in the aggregate for the Offerings, before the deduction of the
Placement Agent’s (as defined below) fee and offering expenses. The
shares of Series A Preferred Stock will have a stated value of $300
per share and will be convertible, at a conversion price of $0.91
per share, into 16,483,516 shares of common stock (subject in
certain circumstances to adjustments). The shares of Series B
Preferred Stock will have a stated value of $300 per share and will
be convertible, at a conversion price of $1.00 per share, into
15,000,000 shares of common stock (subject in certain circumstances
to adjustments). The Series A Preferred Stock and the Series B
Preferred Stock are being offered by the Company pursuant to a
registration statement on Form S-3 (File No. 333-254515)
(the “Registration Statement”) filed under the Securities Act of
1933, as amended (the “Securities Act”). The Purchase Agreement
contains customary representations, warranties and agreements by
the Company and customary conditions to closing. The closing of the
Offerings is expected to occur on January 13,
2022.
The
Company intends to call a special meeting of stockholders to
consider an amendment (the “Amendment”) to the Company’s
Certificate of Incorporation, as amended (the “Charter”), to effect
a reverse stock split of the outstanding shares of common stock
(“Common Stock”) by a
ratio to be determined by the Board of Directors of the Company
(the “Reverse Stock Split”), ranging from 7-to-1 to, 10-to-1,
12-to-1 or 15-to-1. The
Investors have agreed in the Purchase Agreement to not transfer,
offer, sell, contract to sell, hypothecate, pledge or otherwise
dispose of the shares of the Preferred Stock until the Reverse
Stock Split, to vote the shares of the Series A Preferred Stock
purchased in the Offerings in favor of such Amendment and to vote
the shares of the Series B Preferred Stock purchased in the
Offerings in a manner that “mirrors” the proportions on which the
shares of Common Stock (excluding any shares of Common Stock that
are not voted) and Series A Preferred Stock are voted on the
Reverse Stock Split and the Amendment. The Amendment requires the
approval of the majority of the votes associated with our
outstanding stock entitled to vote on the proposal. Since the
Series B Preferred Stock will mirror only votes cast, abstentions
or broker non-votes by common stockholders, which would ordinarily
have the effect of a no vote, will not have any effect on the
outcome of the vote.
Pursuant
to the Purchase Agreement, the Company will file two certificates
of designation (the “Certificates of Designation”) with the
Secretary of the State of Delaware designating the rights,
preferences and limitations of the shares of Preferred Stock. The
Certificates of Designation will provide, in particular, that the
Preferred Stock will have no voting rights, other than the right to
vote as a class on certain specified matters, except that (i) each
share of Series A Preferred Stock will have the right to vote, on
an as converted basis, on the Reverse Stock Split (together with
the Company’s Common Stock and the Series B Preferred Stock as a
single class), and (ii) each share of Series B Preferred Stock will
have the right to cast 45,000 votes per share of Series B Preferred
Stock on the Reverse Stock Split.
The
holder of Preferred Stock will be entitled to dividends, on an
as-if converted basis, equal to dividends actually paid, if any, on
shares of Common Stock. The Preferred Stock is convertible into
shares of Common Stock at a rate of $0.91 per share for the Series
A Preferred Stock and $1.00 per share for the Series B Preferred
Stock. The conversion price can be adjusted pursuant to the
Certificate of Designation for stock dividends and stock splits,
subsequent rights offerings, pro rata distributions of dividends or
the occurrence of a fundamental transaction (as defined in the
applicable Certificate of Designation). The Preferred Stock can be
converted at the option of the holder at any time after the Company
has received stockholder approval for the Reverse Stock Split and
filed the requisite Amendment with the Delaware Secretary of
State’s office to effectuate the Reverse Stock Split (the “Reverse
Stock Split Date”), subject to beneficial ownership limitations set
forth in the applicable Certificate of Designation. In addition, on
or after the Reverse Stock Split Date, and subject to the
satisfaction of certain conditions, the Company can cause the
holder of the Preferred Stock to convert their shares of Preferred
Stock, subject to such beneficial ownership limitations.
Each
holder of the Preferred Stock shall have the right to cause the
Company to redeem all or part of their shares of the Preferred
Stock from the earlier of receipt of stockholder approval of the
reverse stock split or of 90 days following the original issue date
until 120 days following the original issue date, the “Redemption
Date,” in cash at a redemption price equal to 105% of the stated
value plus an amount equal to accumulated but unpaid dividends, if
any, on such shares (whether or not earned or declared, but
excluding interest on such dividends) up to, but excluding, the
Redemption Date. The proceeds of the Offerings will be held in an
escrow account until the expiration of the redemption period for
the Series A Preferred Stock or the Series B Preferred Stock, as
applicable, subject to the earlier payment to redeeming holders.
Upon expiration of the redemption period, any proceeds remaining in
escrow will be disbursed to the Company.
In connection with the Offerings, the Company entered into a
placement agent agreement (the “Placement Agent Agreement”) with
A.G.P./Alliance Global Partners, as placement agent (“AGP,” or the
“Placement Agent”) pursuant to which the Company agreed to pay the
Placement Agents an aggregate cash fee equal to $1,000,000 and
reimburse the Placement Agent for certain of their expenses in an
amount not to exceed $110,000.
The Placement Agent Agreement contains customary representations,
warranties and agreements by the Company, customary conditions to
closing, indemnification obligations of the Company and the
Placement Agent, including for liabilities under the Securities
Act, other obligations of the parties and termination
provisions.
Under the Placement Agent Agreement, the Company and its
subsidiaries are prohibited, for a period of 90 days after the
closing from issuing, entering into any agreement to issue or
announcing any issuance or proposed issuance of common stock,
preferred stock or common stock equivalents, subject to limited
exceptions for exempted issuances as defined in the Purchase
Agreement.
In addition, under the Purchase Agreement, to the extent shares of
Preferred Stock are outstanding, for a period of 30 days from the
date of the Purchase Agreement, the Company and its subsidiaries
are prohibited from (i) issuing entering into any agreement to
issue or announce the issuance or proposed issuance of any shares
of common stock or common stock equivalents or (ii) filing any
registration statement or amendment or supplement thereto, other
than the Prospectus Supplements for the Offerings (other than a
registration statement or amendment or supplement thereto relating
to the issuance or resale of the common stock issuable or issued on
conversion of shares of Preferred Stock). Additionally, to the
extent shares of Preferred Stock are outstanding, from the closing
date of the Purchase Agreement until the date that is 120 days
thereafter, neither the Company nor any of its subsidiaries may
issue any shares of Preferred Stock or other securities having
rights senior to or pari passu with the Preferred
Stock.
Further, from the date of the Purchase Agreement until one year
following the Reverse Stock Split Date, the Company is be
prohibited from effecting or entering into an agreement to effect
any issuance by the Company or any of its subsidiaries of common
stock or common stock equivalents (or a combination of units
thereof) involving a Variable Rate Transaction, as defined in the
Purchase Agreement. Also, until the Reverse Stock Split Date,
neither the Company nor any subsidiary may make any issuance
whatsoever of common stock or common stock equivalents.
The above limitations on issuances of stock under the Purchase
Agreement do not apply to exempt issuances as defined in the
Purchase Agreement.
The foregoing summaries of the Purchase Agreement and the Placement
Agent Agreement do not purport to be complete and are subject to,
and qualified in their entirety by, such documents attached as
Exhibits 10.1 and 1.1, respectively, to this Current Report on Form
8-K, which are incorporated herein by reference.
The representations, warranties and covenants contained in the
Purchase Agreement and the Placement Agent Agreement were made only
for purposes of such agreement and as of specific dates, were
solely for the benefit of the parties to the such agreements and
are subject to limitations agreed upon by the contracting parties.
Accordingly, the Purchase Agreement and the Placement Agent
Agreement are incorporated herein by reference only to provide
investors with information regarding the terms of the Purchase
Agreement and the Placement Agent 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 legal opinions, including the related consent, of Baker &
McKenzie LLP relating to the issuance and sale of Series A
Preferred Stock (and
the shares of Common Stock issuable upon conversion of the Series A
Preferred Stock) and the
Series B Preferred Stock (and the shares of Common Stock
issuable upon conversion of the Series B Preferred Stock)
are filed as Exhibit 5.1 and
Exhibit 5.2, respectively, hereto.
Item
3.03. Material
Modifications to Rights of Security Holders.
The
disclosure required by this Item and included in Item 1.01 of this
Current Report is incorporated herein by reference.
Item
5.03 Amendments
to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
The
disclosure required by this Item and included in Item 1.01 of this
Current Report is incorporated herein by reference.
Item
8.01 Other
Events
The
Company issued a press release announcing the Offering on January
10, 2022. A copy of the press release is attached hereto as Exhibit
99.1, and is incorporated herein by reference.
Item
9.01 Financial
Statements and Exhibits.
(a)
Not Applicable.
(b)
Not Applicable.
(c)
Not Applicable.
(d)
Exhibits
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.
| |
CELSION
CORPORATION |
|
|
|
|
| Date:
January 11, 2022 |
By: |
/s/
Jeffrey W. Church |
| |
|
Jeffrey
W. Church |
| |
|
Executive
Vice President |
| |
|
and
Chief Financial Officer |
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