Item 1.01 Entry into a Material Definitive Agreement.
On February 6, 2023, Marizyme, Inc. (the "Company") entered into a securities
purchase agreement (the "Securities Purchase Agreement") with Walleye
Opportunities Master Fund Ltd (the "Investor"), pursuant to which the Company
issued to the Investor an Unsecured Subordinated Convertible Promissory Note
(the "Note") in the aggregate principal amount of $1,000,000 (the "Subscription
Amount") and a Class D Common Stock Purchase Warrant (the "Warrant") to purchase
up to a number of shares of the Company's common stock equal to the quotient of
250% of the Subscription Amount divided by the price per share at which shares
are sold in the Public Offering (as defined below) (the "Warrant Shares").
The principal amount of the Note must be repaid in full by the Company to the
holder of the Note on or before the date that is 90 days following the issuance
of the Note, or May 7, 2023 (the "Maturity Date"). If all obligations arising
under the Note are not paid or otherwise satisfied in full on the Maturity Date,
then the principal amount of the Note shall be increased from $1,000,000 to
$1,250,000. The Note bears no interest. If an event constituting an event of
default under the Note occurs, including non-payment, defaults of covenants, an
adverse judgment for payment of $500,000 or more, defaults on certain other
indebtedness, bankruptcy-type events, or failure to maintain directors and
officers insurance coverage of at least $1,000,000, and such event of default is
not cured with the period specified, the obligations of the Company under the
Note will become subject to immediate repayment obligations. The Note may be
assigned.
The Warrant shall be exercisable immediately upon the date (the "Public Offering
Date") that the registration statement on Form S-1 of the Company (File No.
333-262697) registering units to be issued in the proposed public offering of
the Company (the "Public Offering Registration Statement") is declared effective
by the Securities and Exchange Commission ("SEC") and may be exercised until the
date that is five years after the Public Offering Date (the "Termination Date").
The exercise price of the Warrant (the "Exercise Price") will be equal to the
public offering price per unit at which units are sold under the Public Offering
Registration Statement (the "Public Offering"). The Warrant provides for
voluntary cashless exercise if at the time of exercise thereof there is no
effective registration statement registering, or the prospectus contained
therein is not available for the issuance of, the Warrant Shares to the Warrant
holder, and provides for automatic cashless exercise upon the Termination Date
if the Warrant is not otherwise exercised. The Warrant holder may not exercise
the Warrant to the extent that the Warrant holder (together with its Affiliates
(as defined by the Warrant)) would beneficially own in excess of 4.99% of the
number of shares of common stock outstanding, as such percentage ownership is
determined in accordance with the terms of the Warrant (the "Beneficial
Ownership Limit"). The Warrant holder may increase the Beneficial Ownership
Limit to any other percentage not in excess of 9.99%, provided that any increase
in such percentage shall not be effective until 61 days following notice from
the Warrant holder. The number of Warrant Shares, the Exercise Price and other
terms of the Warrant are subject to customary adjustments upon the occurrence of
certain corporate events subject to the Beneficial Ownership Limit to the extent
specified. The Company may also voluntarily reduce the Exercise Price to any
amount and for any period of time deemed appropriate by the Board of Directors
of the Company subject to the prior written consent of the Warrant holder. The
Warrant is transferable but may only be disposed of in compliance with state and
federal securities laws pursuant to the Securities Purchase Agreement. The
Warrant Shares acquired upon the exercise of the Warrant, if not registered,
will also have restrictions upon resale imposed by state and federal securities
laws.
Pursuant to the Securities Purchase Agreement, the Company shall promptly, but
in any event no later than 90 days following the Public Offering Date, prepare
and file with the SEC a registration statement covering the resale of the
Warrant Shares (the "Resale Registration Statement"). The Company shall use its
commercially reasonable efforts to have the Resale Registration Statement
declared effective as soon as practicable after filing thereof but in no event
later than the date that is 120 days following the Public Offering Date. After
the Resale Registration Statement is declared effective, the Company shall
continue to keep the Resale Registration Statement effective until the Warrant
Shares may be resold pursuant to Rule 144 under the Securities Act of 1933, as
amended, or have been sold.
The Securities Purchase Agreement and the Note contain customary representations
and warranties and customary covenants for a loan of this kind. The Note is
unsecured and is subordinated in right of payment to the prior payment in full
of all senior indebtedness. For purposes of the Note, "senior indebtedness"
means all indebtedness of the Company to banks, insurance companies and other
financial institutions or funds, unless in the instrument creating or evidencing
such indebtedness it is provided that such indebtedness is not senior in right
of payment to the Note. Subject to the other subordination provisions of the
Note, the Note provides that in the event that the holder of any Senior
Indebtedness accelerates such Senior Indebtedness, then the Note holder may
accelerate the indebtedness evidenced by the Note, and if the Company is
permitted under the terms of the Senior Indebtedness to pay an amount due and
owing under the Note and fails to make such payment, then so long as the terms
of the Senior Indebtedness do not prohibit such action, the Note holder may
exercise its rights to be paid such amount, but only such amount (and the Note
holder shall not be permitted to accelerate under the Note).
The foregoing summary of the terms and conditions of each of the Securities
Purchase Agreement, the Note and the Warrant does not purport to be complete and
is qualified in its entirety by reference to such documents which are filed
hereto as Exhibits 10.1, 4.1 and 4.2.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 is incorporated by reference into this
Item 2.03.
Item 3.02. Unregistered Sales of Equity Securities.
The information set forth under Item 1.01 regarding the issuance of the Note and
the Warrant is incorporated by reference into this Item 3.02 to the extent that
such Item is applicable. The issuance of these securities was effected in
reliance on the exemption from registration provided by Section 4(a)(2) of the
Securities Act of 1933, as amended, Regulation D promulgated thereunder for
transactions not involving a public offering, and/or Regulation S promulgated
thereunder for transactions not involving a U.S. person.
Item 9.01 Financial Statements and Exhibits.
(d)
Number Description
4.1 Unsecured Subordinated Convertible Promissory Note issued by Marizyme,
Inc., dated February 6, 2023
4.2 Class D Common Stock Purchase Warrant issued by Marizyme, Inc.
10.1 Securities Purchase Agreement, dated as of February 6, 2023, by and
between Marizyme, Inc. and Walleye Opportunities Master Fund Ltd.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
© Edgar Online, source Glimpses