Item 1.01 Entry into a Material Definitive Agreement.
Note Regarding Presentation of Capitalization in this Current Report
Unless indicated otherwise, all share amounts, share price amounts and amounts
derived from share amounts and share price amounts contained in this Current
Report on Form 8-K do not give effect to: (i) the filing of a Certificate of
Change Pursuant to Nevada Revised Statutes ("NRS") 78.209 with the Secretary of
State of the State of Nevada (the "Nevada Secretary of State") on August 3,
2022, which provided for a decrease of the registrant's authorized common stock
from 75,000,000 shares to 18,750,000 shares and corresponding decrease of every
four (4) shares of the registrant's issued and outstanding shares of common
stock into one (1) share, and which became effective upon filing; (ii) the
filing of a Certificate of Change Pursuant to NRS 78.209 with the Nevada
Secretary of State on January 5, 2023, which provided for a decrease of the
registrant's authorized common stock from 75,000,000 shares to 20,000,000 shares
and a corresponding change of every three-and-three-quarters (3.75) shares of
the registrant's issued and outstanding shares of common stock to one (1) share,
and which became effective upon filing; (iii) the filing of a Certificate of
Change Pursuant to NRS 78.209 with the Nevada Secretary of State on January 13,
2023, which provided for the increase of the registrant's authorized common
stock from 20,000,000 shares to 75,000,000 shares and the corresponding increase
of every issued and outstanding share of the registrant's common stock to
three-and-three-quarters (3.75) shares, and which became effective at 4:45 PM
Pacific Time on January 17, 2023; (iv) the filing of a Certificate of Change
Pursuant to NRS 78.209 with the Nevada Secretary of State on January 13, 2023,
which provided for the increase of the registrant's authorized common stock from
75,000,000 shares to 300,000,000 shares and the corresponding increase of every
issued and outstanding share of the registrant's common stock to
three-and-three-quarters (3.75) shares, and which became effective at 5:00 PM
Pacific Time on January 17, 2023; and (v) the filing of a Certificate of Change
Pursuant to NRS 78.209 with the Nevada Secretary of State on January 13, 2023,
which provided for the decrease of the registrant's authorized common stock from
300,000,000 to 20,000,000 and the corresponding change of every fifteen (15)
shares of the registrant's issued and outstanding common stock to one (1) share,
and became effective at 5:15 PM Pacific Time on January 17, 2023. See "Part I.
Note Regarding Presentation of Capitalization in this Current Report" of the
registrant's Annual Report on Form 10-K for the fiscal year ended December
31, 2022, filed on March 24, 2023, for related discussion, which is incorporated
by reference herein.
Exercise of Somahlution Warrants with Reduced Exercise Price
As previously reported in Current Reports on Form 8-K filed by Marizyme, Inc.
(the "Company") on December 19, 2019 and August 5, 2020 , on December 15,
2019, the Company entered into an asset purchase agreement, as amended on March
31, 2020, May 29, 2020, and July 30, 2020 (the "Asset Purchase Agreement"), with
Somahlution, LLC, a Delaware limited liability company ("Somahlution, LLC"),
Somahlution, Inc., a Delaware corporation ("Somahlution, Inc."), and
Somaceutica, LLC, a Delaware limited liability company (collectively, the
"Sellers"). Pursuant to the terms of the Asset Purchase Agreement, the Company
agreed to purchase all of the assets and none of the liabilities of the Sellers,
provided that the Company agreed to acquire the outstanding capital stock of
Somahlution, Inc., held by Somahlution, LLC, rather than the assets of
Somahlution, Inc. (the "Acquisition"). On August 4, 2020, the Acquisition
closed. As consideration for the Acquisition, the Company issued to certain
designees of the Sellers (the "Warrant Holders") a total of 10,000,000
restricted shares of common stock and five-year warrants to purchase an
additional 2,999,955 shares of common stock with an exercise price of $5.00 per
share (the "Somahlution Warrants").
On April 13, 2023, Marizyme, Inc. (the "Company") delivered offer letter
agreements (the "Somahlution Warrant Offer Letter Agreements") to the Warrant
Holders, which offered to allow the Warrant Holders to exercise the Somahlution
Warrants to purchase the number of restricted shares of common stock issuable
under their Somahlution Warrants at an exercise price reduced by the Company
from $5.00 per share to $0.10 per share, on or prior to April 21, 2023, for
maximum total cash proceeds of $299,995.50. Since April 14, 2023, and as of the
date of this Current Report on Form 8-K, four of the Warrant Holders had entered
into Somahlution Warrant Offer Letter Agreements and had exercised their
Somahlution Warrants to purchase a total of 2,652,159 shares of common stock for
gross proceeds of approximately $265,216 the (the "Warrant Exercise"). Univest
Securities, LLC, as the Company's placement agent ("Univest"), which facilitated
the Warrant Exercise, waived any fees or reimbursable expenses that would
otherwise have been payable with respect to the Warrant Exercise pursuant to the
Placement Agency Agreement, dated as of December 21, 2021, between Univest and
the Company.
The foregoing description of the Somahlution Warrant Offer Letter Agreements is
qualified in its entirety by reference to the form of such documents which is
filed as Exhibit 10.1 to this Current Report on Form 8-K.
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Adjustment to Conversion Price of Convertible Notes and Exercise Price of Class
C Warrants
As previously reported in a Current Report on Form 8-K filed by the Company
on January 17, 2023 (the "January 2023 Form 8-K"), which is incorporated by
reference herein, from May 2021 to August 2022, the Company conducted a private
placement (the "Units Private Placement") of units consisting of 10% secured
convertible promissory notes (the "Convertible Notes") and accompanying warrants
(the "Class C Warrants"), as were modified or amended from time to time, with
Univest, the terms of which were described in detail in the January 2023 Form
8-K. As reported in the January 2023 Form 8-K, among their other terms, the
Convertible Notes and Class C Warrants provide that a lower price per share, or
more favorable terms, respectively, under subsequent equity issuances, not
including qualified financings and certain other exempt issuances, will be
applicable to the conversion or exercise rights under the Convertible Notes and
Class C Warrants, respectively. In addition, as reported in the January 2023
Form 8-K, under a Letter Agreement between the Company and Univest as placement
agent for the investors in the Units Private Placement, dated January 12, 2023
(the "Univest Letter Agreement"), the parties agreed that simultaneously with
any adjustment to the exercise price under the Class C Warrants as a result of
any equity issuances, not including qualified financings and certain other
exempt issuances, the number of shares of common stock that may be purchased
under the Class C Warrants will be increased such that the aggregate exercise
price of such shares will be the same as the same as the aggregate exercise
price in effect immediately prior to the adjustment, without regard to any
limitations on exercise contained in the Class C Warrants, including the
beneficial ownership limitation described above.
At the time of the Warrant Exercise, the Convertible Notes were convertible at a
conversion price of $1.75 per share and the Class C Warrants were exercisable at
an exercise price of $2.25 per share. Outstanding Convertible Notes have
underlying principal of $14,471,177, and outstanding Class C Warrants were
exercisable to purchase a total of 16,538,473 shares of common stock. In
connection with the transaction contemplated by the Somahlution Warrant Offer
Letter Agreements and certain unrelated matters, the Company obtained exercise
and conversion rights waivers and amendments from certain holders of the
Convertible Notes and Class C Warrants, which reduced the principal underlying
Convertible Notes' with conversion rights to Convertible Notes with a total of
$4,471,177 in principal, and reduced outstanding Class C Warrants with exercise
rights to Class C Warrants having exercise rights to Class C Warrants
exercisable to purchase 5,109,904 shares of common stock. As a result of the
Warrant Exercise and pursuant to the adjustment provisions described above, the
conversion price of the Convertible Notes and the exercise price of the Class C
Warrants adjusted to $0.10 per share. As a result of these adjustment provisions
and the conversion and exercise terms of the Convertible Notes and Class C
Warrants, the number of shares into which the Convertible Notes may be converted
adjusted from 2,554,944 shares of common stock, not including shares convertible
from interest under the Convertible Notes, to 44,711,770 shares of common stock,
not including shares convertible from interest under the Convertible Notes,
subject to rounding adjustments, and the number of shares that the Class C
Warrants may be exercised to purchase adjusted from 5,109,904 shares of common
stock to 114,972,840 shares, subject to rounding adjustments.
The foregoing description of the Univest Letter Agreement, the Convertible Notes
and the Class C Warrants is qualified in its entirety by reference to the
description of these and related documents and transactions in "Item 1.01 Entry
into a Material Definitive Agreement." of the January 2023 Form 8-K.
Item 3.02. Unregistered Sales of Equity Securities.
The disclosure set forth under "Item 1.01. Entry into a Material Definitive
Agreement - Note Regarding Presentation of Capitalization in this Current
Report" and "Item 1.01. Entry into a Material Definitive Agreement - Exercise of
Somahlution Warrants with Reduced Exercise Price" is incorporated by reference
into this Item 3.02. The offer of securities pursuant to the Somahlution Warrant
Offer Letter Agreements and sale of restricted common stock pursuant to the
exercise of the Somahlution Warrants described above was conducted as a private
placement pursuant to and in reliance on the exemption from registration
provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the
"Securities Act"), and Rule 506(b) of Regulation D promulgated thereunder
("Regulation D") for transactions not involving a public offering. In connection
with the execution of the Somahlution Warrant Offer Letter Agreements, each of
the Warrant Holders represented that such Warrant Holder was an "accredited
investor" as such term is defined in Rule 501(a) of Regulation D.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description of Exhibit
10.1 Form of Letter Agreement with certain holders of Common Share
Purchase Warrants of Marizyme, Inc. dated August 4, 2020
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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