SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 8, 2020
KBL MERGER CORP. IV
(Exact Name of Registrant as Specified in Charter)
or Other Jurisdiction
30 Park Place, Suite 45E
New York, NY
|(Address of Principal Executive Offices)||(Zip Code)|
Registrant’s telephone number, including area code: (302) 502-2727
(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 communications 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 communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))|
|☐||Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c))|
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. ☐
Securities registered pursuant to Section 12(b) of the Act:
|Title of each class||Trading Symbol(s)|
Name of each exchange on
|Common Stock, par value $0.0001 per share||KBLM||The NASDAQ Stock Market LLC|
|Warrants, each warrant exercisable for one-half of one share of Common Stock at an exercise price of $5.75 per half share||KBLMW||The NASDAQ Stock Market LLC|
|Rights, exchangeable into one-tenth of one share of Common Stock||KBLMR||The NASDAQ Stock Market LLC|
|Units, each consisting of one share of Common Stock, one Warrant and one Right||KBLMU||The NASDAQ Stock Market LLC|
Item 1.01 Entry into a Material Definitive Agreement.
On September 8, 2020, KBL Merger Corp. IV (“KBL” or the “Company”) entered into a Securities Purchase Agreement (the “SPA”) whereby it issued to the institutional investors party thereto secured convertible promissory notes in the aggregate principal amount of $1,111,111.11 (collectively, the “Notes”) for an aggregate purchase price of $1,000,000. The Notes are subject to 10% original issue discount, are due on April 7, 2021, and accrue interest at the rate of 10% per annum, with interest being guaranteed to the maturity of the Notes, regardless of when any Note is converted. The Notes are all initially convertible into the Company’s common stock, par value $0.0001 per share (the “Common Stock”), at a per share conversion price equal to $5.28. Beginning ninety (90) days following the Company’s completion of its contemplated business combination, as initially reported in the Company’s Current Report on Form 8-K filed with the Commission on July 23, 2019 (the “Business Combination”), the conversion price will equal the lowest VWAP of the Company’s Common Stock during the five (5) trading day period ending on the trading day immediately prior to the conversion date, but in no event will the conversion price be lower than $2.00. In connection with the closing of the transactions contemplated by the SPA, the Company issued an aggregate of 100,000 restricted shares of Common Stock to the investors (the “Commitment Shares”). The Company agreed to register with the Securities and Exchange Commission the resale of the shares of Common Stock issuable upon conversion of the Notes, as well as the Commitment Shares, and it entered into a Registration Rights Agreement dated September 8, 2020 with the investors regarding such obligation (the “Registration Rights Agreement”).
The Notes contain certain covenants, and events of default and triggering events, respectively, which would require repayment of the obligations outstanding pursuant to the Notes. The obligations of the Company under the Notes are secured by all assets of the Company, and are guaranteed by all other entities party to the Business Combination Agreement.
The foregoing description of the SPA, the Notes and the Registration Rights Agreement, and the transactions contemplated thereby, is qualified in its entirety by the full text of the SPA, the Notes and the Registration Rights Agreement, copies of which are filed herewith as Exhibits 10.1, 4.1 and 10.2, respectively, and are incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information provided under Item 1.01 in this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Item 3.02. Unregistered Sales of Equity Securities
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. The Notes and the Commitment Shares were issued without registration under the Securities Act of 1933, as amended (the “Securities Act”), based on the exemption from registration afforded by Section 4(a)(2) of the Securities Act.
Item 9.01. Financial Statements and Exhibits
|4.1||Form of 10% Senior Secured Convertible Promissory Note|
|10.1||Securities Purchase Agreement, dated September 8, 2020, by and among the Company and the purchasers signatory thereto.|
|10.2||Registration Rights Agreement, dated September 8, 2020, by and among the Company and the parties signatory thereto.|
Certain statements made herein are “forward-looking statements” within the meaning of U.S. federal securities laws. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results and, consequently, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements and factors that may cause such differences include, without limitation, statements relating to the timing and completion of the proposed business combination; KBL’s continued listing on the Nasdaq Stock Market until closing of the proposed business combination; expectations regarding the capitalization, resources and ownership structure of the combined company; the inability to recognize the anticipated benefits of the proposed business combination, which may be affected by, among other things, the amount of cash available following any redemptions by KBL stockholders; the ability to meet the Nasdaq Stock Market’s listing standards following the consummation of the transactions contemplated by the proposed business combination; costs related to the proposed business combination; expectations with respect to future performance, growth and anticipated acquisitions; ability to recognize the anticipated benefits of the proposed business combination; the Company’s ability to execute its plans to develop and market new drug products and the timing and costs of these development programs; the Company’s estimates of the size of the markets for its potential drug products; potential litigation involving KBL or the Company or the validity or enforceability of the Company’s intellectual property; global economic conditions; geopolitical events and regulatory changes; access to additional financing; and other risks and uncertainties indicated from time to time in filings with the Securities and Exchange Commission (the “SEC”). Other factors include the possibility that the proposed business combination does not close, including due to the failure to receive required security holder approvals, or the failure of other closing conditions. The foregoing list of factors is not exclusive. Additional information concerning these and other risk factors is contained in KBL’s most recent filings with the SEC and will be contained in the proxy statement/prospectus to be filed as result of the transactions described above. All subsequent written and oral forward-looking statements concerning KBL or the Company, the transactions described herein or other matters and attributable to KBL or the Company or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. None of KBL or the Company undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in their expectations or any change in events, conditions or circumstances on which any such statement is based.
Additional Information and Where to Find It
KBL has filed a registration statement on Form S-4, which includes a preliminary proxy statement/prospectus for KBL’s stockholders, with the SEC. KBL’s definitive proxy statement/prospectus will be mailed to KBL’s stockholders that do not opt to receive the document electronically. KBL and the Company urge investors, stockholders and other interested persons to read the preliminary proxy statement/prospectus, as well as other documents that will be filed with the SEC, because these documents will contain important information about the proposed business combination transaction. Such persons can also read KBL’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, for a description of the security holdings of its officers and directors and their respective interests as security holders in the consummation of the proposed business combination transaction. KBL’s definitive proxy statement/prospectus, which is included in the registration statement, will be mailed to stockholders of KBL as of a record date to be established. KBL’s stockholders will also be able to obtain a copy of such documents, without charge, by directing a request to: KBL Merger Corp. IV, 30 Park Place, Suite 45E, New York, NY 10007; e-mail: email@example.com. These documents can also be obtained, without charge, at the SEC’s web site (http://www.sec.gov).
Participants in the Solicitation
KBL and its directors and executive officers, may be deemed to be participants in the solicitation of proxies for the special meeting of KBL’s stockholders to be held to approve the proposed transactions in connection with the business combination. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of KBL’s stockholders in connection with the proposed transactions are set forth in the amended preliminary proxy statement/prospectus included in the registration statement that was filed with the SEC on August 28, 2020. You can find information about KBL’s executive officers and directors in its Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which was filed with the SEC on April 7, 2020. You can obtain free copies of these documents from KBL using the contact information above.
This communication is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed transaction and shall not constitute an offer to sell or a solicitation of an offer to buy the securities of KBL and the Company, nor shall there be any sale of any such securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
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.
Date: September 14, 2020
|KBL MERGER CORP. IV|
|By:||/s/ Marlene Krauss, M.D.|
|Name: Marlene Krauss, M.D.|
|Title: Chief Executive Officer|