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): May 15,
2023
VENUS CONCEPT INC.
(Exact name of registrant as specified in its charter)
Delaware
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001-38238
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06-1681204
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification Number)
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235 Yorkland Blvd, Suite 900
Toronto, Ontario M2J 4Y8
(Address of principal executive offices, including Zip Code)
Registrant’s telephone number, including area code: (877)
848-8430
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:
☐
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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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Securities registered pursuant to Section 12(b) of the Act:
Title of each class
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Trading
Symbol(s)
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Name of each exchange
on which registered
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Common Stock, $0.0001 par value per share
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VERO
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The Nasdaq
Capital Market
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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.
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Multi-Tranche Private Placement
On May 15, 2023, Venus Concept Inc. (the “Company”) entered into
a stock purchase agreement (the “Stock Purchase
Agreement”) with EW Healthcare Partners, L.P. and EW
Healthcare Partners-A, L.P. (collectively, the “Investors”). Under the
Stock Purchase Agreement, the Company may issue and sell to the
Investors up to $9,000,000 in shares of newly-created senior
convertible preferred stock, par value $0.0001 per share (the
“Senior Preferred
Stock”), in multiple tranches from time to time until
December 31, 2025, subject to a minimum aggregate purchase amount
of $500,000 in each tranche (the “Private Placement”).
Other than the Initial Placement (as defined below), sales of
Senior Preferred Stock in the Private Placement are purely
discretionary and must be approved by both the Company and the
Investors.
The purchase price for each share of Senior Preferred Stock floats
at a price equal to the product of (a) the lower of (i) the closing
price of the Company’s common stock, par value $0.0001 per share
(“Common
Stock”), on the trading day immediately preceding the
applicable closing date and (ii) the average closing price of the
Common Stock for the five trading days immediately preceding the
applicable closing date, multiplied
by (b) two (the “Purchase Price”). The
Senior Preferred Stock is convertible into shares of Common Stock
on a 1-for-2.6667 basis at the option of (x) the Investors at any
time or (y) the Company within 30 days following the occurrence of
specified trigger events. The terms of the Senior Preferred Stock
are further described below under Item 5.03 of this Current Report
on Form 8‑K.
The initial sale in the Private Placement occurred on May 15, 2023,
under which the Company sold the Investors 280,899 shares of Senior
Preferred Stock for an aggregate purchase price of $2,000,000 (the
“Initial
Placement”). The Company expects to use the proceeds of the
Initial Placement, after the payment of transaction expenses, for
general working capital purposes.
Subject to the terms and conditions of the Stock Purchase
Agreement, the Company is required, upon the request of the
Purchasers, to call one or more shareholder meetings for the
purpose of eliminating any limitations on the convertibility of the
Senior Preferred Stock imposed by the rules and regulations of the
Nasdaq Capital Market. On May 15, 2023, the Company secured
agreements from certain of its investors, currently holding an
aggregate of 59.2% of the Company’s voting securities, to vote
their shares in favor of eliminating any such limitations at any
shareholder meeting called for such purpose.
Contemporaneously with the execution of the Stock Purchase
Agreement, the Company and the Investors entered into a
Registration Rights Agreement, dated May 15, 2023 (the
“Registration
Rights Agreement”), under which the Company is required to
file one or more demand shelf registration statements with respect
to the shares of Common Stock issuable upon conversion of Senior
Preferred Stock that has been sold under the Stock Purchase
Agreement. Pursuant to the Registration Rights Agreement, the
Company must file a registration statement for the offer and resale
of the Common Stock underlying the Senior Preferred Stock then
issued no later than July 15, 2023, and cause to be declared by the
U.S. Securities and Exchange Commission (the “SEC”) as promptly as
possible thereafter, but in no event later than 90 days
thereafter.
The shares of Senior Preferred Stock issued or issuable by the
Company under the Stock Purchase Agreement, as well as the shares
of Common Stock issuable upon conversion of the Senior Preferred
Stock, have not been registered under the Securities Act and may
not be offered or sold in the United States absent registration or
an applicable exemption from registration requirements. The Company
relied on, and will rely on, the private placement exemption from
registration provided by Section 4(a)(2) of the Securities Act and
by Rule 506 of Registration D, promulgated by the SEC, and on
similar exemptions under applicable state laws.
The Stock Purchase Agreement and the Registration Rights Agreement
contain customary representations, warranties and agreements by the
Company, indemnification obligations of the Company, including for
liabilities under the Securities Act of 1933, as amended (the
“Securities
Act”), and other obligations of the parties. The
representations, warranties, and covenants contained in such
agreements were made only for purposes of such agreements and are
made as of specific dates; are solely for the benefit of the
parties (except as specifically set forth therein); may be subject
to qualifications and limitations agreed upon by the parties in
connection with negotiating the terms of the such agreements; and
may be subject to standards of materiality and knowledge applicable
to the contracting parties that differ from those applicable to the
investors generally. Investors should not rely on such
representations, warranties, and covenants, or any description
thereof, as characterizations of the actual state of facts or
condition of the Company.
The foregoing descriptions of the Stock Purchase Agreement and the
Registration Rights Agreement do not purport to be complete and are
qualified in their entirety by reference to the full text of the
Stock Purchase Agreement and the Registration Rights Agreement,
copies of which are filed herewith as Exhibits 10.1 and 10.2,
respectively.
Item 3.02. |
Unregistered Sales
of Equity Securities.
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The information contained in Items 1.01 and 5.03 of this Current
Report on Form 8-K is incorporated by reference into this Item
3.02.
Item 5.03 |
Amendment to
Articles of Incorporation of Company or Bylaws; Change in Fiscal
Year.
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Certificate of Elimination of Nonvoting Preferred Stock
On May 15, 2023, the Company filed with the Delaware Secretary of
State a Certificate of Elimination (the Certificate of
Elimination”) with respect to the Company’s nonvoting
convertible preferred stock (the “Nonvoting Preferred
Stock”). All shares of Nonvoting Preferred Stock were
previously converted into Common Stock, and thus no such shares are
outstanding, nor will any such shares be issued in the
future. Accordingly, the Company filed the Certificate of
Elimination to eliminate the Nonvoting Preferred Stock from the
Company’s authorized capital, thereby returning such shares to the
status of authorized but unissued shares of “blank check” preferred
stock of the Company.
The foregoing description of the Certificate of Elimination does
not purport to be complete and is qualified in its entirety by
reference to the full text of the Certificate of Amendment, which
is filed herewith as Exhibit 3.1.
Certificate of Designations of Senior Preferred Stock
On May 15, 2023, the Company filed with the Delaware Secretary of
State a Certificate of Designations of with respect to the Senior
Preferred Stock (the “Certificate of
Designations”), thereby creating the Senior Preferred
Stock.
The Certificate of Designations authorizes the issuance of up to
3,000,000 shares of Senior Preferred Stock. The Senior Preferred
Stock is convertible into shares of Common Stock on a 1-for-2.6667
basis at the option of (a) the Investors at any time or (b) the
Company within 30 days following the date on which the 30-day
volume-weighted average price of the Common Stock exceeds the
product of (i) the Purchase Price for the shares of Senior
Preferred Stock sought to be converted, multiplied by (ii)
2.75. In addition, the Certificate of Designations provides that,
while the Senior Preferred Stock is outstanding but not later than
December 31, 2025, the holders of Senior Preferred Stock, which
includes the Investors and any of their affiliates holding shares
of Senior Preferred Stock, have the right to exchange their shares
of Senior Preferred Stock under certain conditions if the Company
issues or sells other securities that such holders of Senior
Preferred Stock reasonably believe contain more favorable terms,
taken as a whole.
Each share of Senior Preferred Stock carries a liquidation
preference, senior to the Common Stock and the Company’s voting
convertible preferred stock, par value $0.0001 per share
(“Junior
Preferred Stock”), in an amount equal to the product of the
Purchase Price for such share, multiplied by 2.50.
Each share of Senior Preferred Stock is entitled to participate in
dividends and other non-liquidating distributions (if, as and when
declared by the Board of Directors of the Company) on an
as-converted basis, pari passu with the Common Stock and Junior
Preferred Stock.
The Senior Preferred Stock is non-voting; provided, however, that
as long as any shares of Senior Preferred Stock are outstanding,
the Company will not, without the affirmative vote of the holders
of a majority of the then outstanding shares of the Senior
Preferred Stock, (a) increase the authorized number of shares of
Senior Preferred Stock; (b) enter any agreement, contract or
understanding or otherwise incur any obligation which by its terms
would violate or be in conflict in any material respect with, or
significantly and adversely affect, the powers, rights or
preferences of the Senior Preferred Stock designated hereunder; (c)
amend the certificate of incorporation or bylaws of the Company, if
such amendment would significantly and adversely alter, change or
affect the powers, preferences or rights of the holders; (d)
redeem, repurchase or declare or pay any dividend or other
distribution on the Company’s capital stock, subject to certain
customary exceptions; or (e) amend or waive any provision of the
Certificate of Designations applicable to the holders or the Senior
Preferred.
The foregoing description of the Certificate of Designations does
not purport to be complete and is qualified in its entirety by
reference to the full text of the Certificate of Designations,
which is filed herewith as Exhibit 3.2.
Item 7.01. |
Regulation FD Disclosure.
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On May 15, 2023, the Company issued a press release regarding the
Private Placement. A copy of the press release is attached hereto
as Exhibit 99.1 and is incorporated herein by reference.
The information contained in this Item 7.01, including Exhibit 99.1
incorporated by reference herein, shall not be deemed “filed”
for purposes of Section 18 of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), or otherwise subject to the
liabilities of that Section, nor incorporated by reference in any
filing under the Securities Act of 1933, as amended, or the
Exchange Act, except as shall be expressly set forth by specific
reference in such filing.
Cautionary Statement Regarding Forward-Looking Statements
This Current Report on Form 8-K contains “forward-looking”
statements within the meaning of Section 27A of the Securities Act
and Section 21E of the Exchange Act. Any statements contained
herein that are not of historical facts may be deemed to be
forward-looking statements. In some cases, readers can identify
these statements by words such as such as “anticipates,”
“believes,” “plans,” “expects,” “projects,” “future,” “intends,”
“may,” “should,” “could,” “estimates,” “predicts,” “potential,”
“continue,” “guidance,” and other similar expressions that are
predictions of or indicate future events and future trends. These
forward-looking statements include, but are not limited to,
statements about the expecting timing of the initial closing of the
sale of Senior Preferred Stock and whether or not any subsequent
sales of the Senior Preferred Stock will occur. These
forward-looking statements are based on current expectations,
estimates, forecasts, and projections about the Company’s business
and the industry in which the Company operates and management's
beliefs and assumptions and are not guarantees of future
performance or developments and involve known and unknown risks,
uncertainties, and other factors that are in some cases beyond the
Company’s control. As a result, any or all of the Company’s
forward-looking statements in this Current Report on Form 8-K may
turn out to be inaccurate. Factors that could materially affect the
Company’s business operations and financial performance and
condition include, but are not limited to, general economic conditions,
including the global economic impact of COVID-19, and involve risks
and uncertainties that may cause results to differ materially from
those set forth in the statements and those risks and uncertainties
described under Part II Item 1A—“Risk Factors” in the Company’s
Quarterly Reports on Form 10-Q and Part I Item 1A—“Risk Factors” in
the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022. Readers are urged to consider these factors
carefully in evaluating the forward-looking statements and are
cautioned not to place undue reliance on the forward-looking
statements. The forward-looking statements are based on information
available to the Company as of the date of this Current Report on
Form 8-K. Unless required by law, the Company does not intend to
publicly update or revise any forward-looking statements to reflect
new information or future events or otherwise.
Item 9.01. |
Financial Statements and Exhibits.
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Exhibit
No.
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Description
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Certificate of Elimination of Nonvoting Convertible Preferred
Stock
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Certificate of Designations of Senior Convertible Preferred
Stock
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Stock
Purchase Agreement, dated May 15, 2023, by and among Venus Concept
Inc., EW Healthcare Partners, L.P. and EW Healthcare Partners-A
L.P.
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Registration Rights Agreement, dated May 15, 2023, by and among
Venus Concept Inc., EW Healthcare Partners, L.P. and EW Healthcare
Partners-A L.P.
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Press
release dated May 15, 2023
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104
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Cover
Page Interactive Data File (embedded within the Inline XBRL
document)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
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VENUS CONCEPT INC.
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Date: May
15, 2023
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By:
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/s/
Domenic Della Penna
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Domenic
Della Penna
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Chief
Financial Officer
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