AND EXCHANGE COMMISSION
to Section 13 or 15(d) of
Securities Exchange Act of 1934
of Report (Date of earliest event reported): December 11,
KRAIG BIOCRAFT LABORATORIES, INC.
name of registrant as specified in its charter)
or other jurisdiction
South State St. Suite 150
Arbor, Michigan 48104
(Address of principal executive offices, including Zip
telephone number, including area code)
name or former address, if changed since last
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:
communications pursuant to Rule 425 under the Securities Act (17
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
registered pursuant to Section 12(b) of the Act:
of each class
of each exchange on which registered
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).
growth company [ ]
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.
into a Material Definitive Agreement.
December 11, 2020, Kraig Biocraft Laboratories, Inc. (the
“Company”) entered into a Securities Purchase Agreement (the
“Purchase Agreement”) with one accredited investor (the
“Investor”). Pursuant to the Purchase Agreement, the Company
sold and issued a convertible debenture (the “Convertible
Debenture”) in the principal amount of $1,000,000 to the
Investor and received the purchase price of $950,000 from such
Investor (the “Financing”). The Company also issued the
Investor a five-year warrant to purchase up to 3,125,000 shares of
the Company’s common stock, no par value (the “Common
Stock”) at an initial exercise price of $0.16 per share (the
“Exercise Price”), subject to adjustment (the
“Warrant”). Maxim Group LLC (“Maxim”) acted as
placement agent in the Financing.
Convertible Debenture was issued on December 11, 2020 (the
“Issuance Date”) and the maturity date of the Convertible
Debenture is January 11, 2022 (the “Maturity Date”). The
Convertible Debenture bears an interest rate of ten percent (10%)
per annum, which increases to 15% per annum upon the occurrence of
an event of default under the Convertible Debenture and until such
default is cured. Commencing July 1, 2021 and on the first business
day of each month thereafter until the entire principal amount on
the Convertible Debenture has been paid, the Company can either:
(i) pay the Investor in cash, in an amount equal to $166,666 (the
last payment being $166,670) of principal (the “the Installment
Amount”), plus accrued and outstanding interest and an amount
equal to 10% of the current Installment Amount for Installment
Amounts due within 180 days following the closing of the Financing,
and 15% of the Installment Amount for Installment Amounts due
thereafter; (ii) by converting such Installment Amount into shares
of Common Stock, provided that certain conditions are met; or (iii)
by any combination of a cash payment and Common Stock conversion.
Should the Company decide to pay all or part of the Installment
Amount in shares of Common Stock, it shall issue that number of
shares of Common Stock as is equal to the applicable amount of the
Installment Amount divided by the then current Market Conversion
Price. “Market Conversion Price” means, as of any conversion
date, 90% of the lowest volume weighted average price of the Common
Stock during the 10 trading days immediately preceding the
conversion date, subject to adjustment; provided, that if the
Company uplists the Common Stock to Nasdaq, then the Market
Conversion Price shall not be lower than the Market Conversion
Price on the date of the first conversion (as adjusted for stock
splits and similar events).
an event of default, as outlined in the Convertible Debenture, the
holders of each Convertible Debenture may elect to convert part or
all of the outstanding balance of the Convertible Debenture into
shares of Common Stock at the Market Conversion Price. The number
of shares of Common Stock issuable upon such a conversion shall be
determined by dividing (x) the conversion amount by (y) the Market
Conversion Price. A holder may not convert any amount into shares
of Common Stock, if after such conversion the holder would
beneficially own in excess of 4.99% of the Common Stock then
outstanding (the “Ownership Limit”).
Company maintains the right to redeem the outstanding principal and
interest of the Convertible Debenture in whole or in part prior to
the Maturity Date. Upon the maturity date, the Company shall pay to
the Investor an amount, in cash, representing all outstanding
principal and accrued and unpaid interest under the Convertible
Warrant may be exercised at any time before expiration so long as
the exercise would not result in the holder exceeding the Ownership
Limit. The Warrant may also be exercised via cashless exercise. If
the Company issues any shares of Common Stock at a price less than
the Exercise Price, then the exercise price of the Warrant shall be
reduced to such lower price at which the additional shares of
Common Stock were sold.
Purchase Agreement also contains customary representation and
warranties of the Company and the Investor, indemnification
obligations of the Company, termination provisions, and other
obligations and rights of the parties.
foregoing description of the SPA, Convertible Debenture and Warrant
is qualified by reference to the full text of the forms of SPA,
Convertible Debenture and Warrant, which are filed as Exhibits
10.1, 10.2 and 10.3 hereto and incorporated herein by
shall receive a $76,000 cash fee for their services as placement
This disclosure does not constitute an offer to sell, or the
solicitation of an offer to buy nor shall there be any sales of the
Company’s securities in any state in which such offer, solicitation
or sale would be unlawful. The securities mentioned herein have not
been, nor will they be, registered under the United States
Securities Act of 1933, as amended, and may not be offered or sold
in the United States absent registration or an applicable exemption
from the registration requirements under the Securities Act and
applicable state securities laws.
of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
disclosures set forth in Item 1.01 of this Current Report are
incorporated by reference herein.
Company issued a press release on December 11, 2020 announcing the
Financing. A copy of the
press release is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
Statements and Exhibits.
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.
December 11, 2020
KRAIG BIOCRAFT LABORATORIES, INC.
Chief Financial Officer and Director