UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
|
| |||
(State or other jurisdiction | (Commission | (IRS Employer |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code (
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:
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||
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. |
As previously reported, on October 10, 2022, Kiromic BioPharma, Inc. (the “Company”) and certain current and former officers and directors of the Company (together with the Company, the “Defendants”) entered into a Stipulation of Settlement and Mutual Release (the “Initial Settlement Agreement”) with entities related to Empery Asset Management, LP (the “Empery Entities”) and entered into an Initial Settlement Agreement with Sabby Volatility Warrant Master Fund Ltd. (“Sabby”, together with the Empery Entities, the “Plaintiffs”), respectively, in connection with a case filed by the Plaintiffs against the Defendants for alleged violations of Sections 11, 12, and 15 of the Securities Act of 1933, as amended (the “Securities Act”) in connection with the purchase of Company’s common stock through the Company’s public offering that closed on July 2, 2021. Pursuant to the Initial Settlement Agreements, the Plaintiffs and the Defendants agreed to dismiss the case with prejudice against all Defendants (including ThinkEquity, LLC) with no admission of liability (the “Settlement”). As part of the Settlement, the Company agreed to (a) make a $75,000 cash payment to each of the Empery Entities and Sabby and (b) issue convertible notes (the “Settlement Notes”) in the aggregate principal amount of $1,656,720 to each of the Empery Entities and Sabby. The Settlement Notes are convertible into shares of the Company’s common stock (the “Conversion Shares”) at an initial conversion price per share of $0.3068 (the “Conversion Price”), subject to a beneficial ownership limitation equivalent to 9.99% (“Beneficial Ownership Limitation”).
Both Initial Settlement Agreements were conditioned upon the Company obtaining financing no later than October 18, 2022 for aggregate gross proceeds to the Company of not less than $5 million (the “Conditional Financing”), after which within one business day the parties should promptly submit a joint motion seeking approval of the Initial Settlement Agreements under Section 3(a)(10) of the Securities Act (the “Joint Motion”) from the United States District Court for the Southern District of New York (the “Court”).
On October 27, 2022, the Defendants entered into an Amended Stipulation of Settlement and Mutual Release with the Empery Entities (the “Amended Empery Settlement Agreement”) and Sabby (together with the Amended Empery Settlement Agreement, the “Amended Settlement Agreements”), respectively. Both Amended Settlement Agreements removed the satisfaction of the Conditional Financing as a condition to the Settlement and provided that the parties shall file the Joint Motion no later than October 25, 2022. The Amended Empery Settlement Agreement shall become void if the Court does not approve the Joint Motion by November 15, 2022, subject to extension by the Empery Entities.
On November 2, 2022, the Court granted the Joint Motion, pursuant to which the Settlement Notes will be unrestricted and exempt from the registration requirements of the Securities Act, and the Conversion Shares, when issued upon conversion of the Settlement Notes in accordance with the terms set forth therein, will also be unrestricted and exempt from the registration requirements of the Securities Act.
The foregoing description of the Amended Settlement Agreements is qualified in its entirety by reference to the full text of such Amended Settlement Agreements, copies of which are attached hereto as exhibits 10.1 and 10.2, respectively, and incorporated herein by reference.
Item 3.02 | Unregistered Sales of Equity Securities |
Reference is made to the disclosure set forth under Item 1.01 above, which disclosure is incorporated herein by reference. The Settlement Notes, in aggregate, shall be convertible into a maximum of 10,800,000 shares of the Company’s common stock, subject to the adjustment of the Conversion Price and the Beneficial Ownership Limitation. The issuance of the Settlement Notes and the Conversion Shares will be under the exemption provided by Section 3(a)(10) of the Securities Act in accordance with the Joint Motion.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
Exhibit No. |
| Description |
| ||
10.1 | ||
10.2 | ||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
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: November 2, 2022 | KIROMIC BIOPHARMA, INC. | ||
By: | /s/ Daniel Clark | ||
Name: | Daniel Clark | ||
Title: | Chief Financial Officer | ||
AMENDED STIPULATION OF SETTLEMENT AND MUTUAL RELEASE
WHEREAS, on July 2, 2021, Empery Asset Master, Ltd., Empery Tax Efficient, LP, and Empery Tax Efficient III, LP (collectively, the “Empery Funds”) participated in a public offering by Kiromic Biopharma, Inc. (“Kiromic” or the “Company”) pursuant to which the Empery Funds purchased an aggregate of 1,000,000 shares of common stock, par value $0.001 per share (“Common Stock”) of Kiromic for $5 million (the “Offering”);
WHEREAS, on June 25, 2021, Kiromic filed a registration statement (the “Registration Statement”) with the Securities Exchange Commission in connection with the Offering, signed by Maurizio Chiriva-Inernati, Tony Tontat, Gianluca Rotino, Pietro Bersani, Americo Cicchetti, Michael Nagel, and Jerry Schneider (collectively, the “Individual Defendants,” and together with Kiromic and ThinkEquity (as defined below), the “Defendants”) (Defendants, together with the Empery Funds, the “Parties”);
WHEREAS, on June 29, 2021, Kiromic filed a final prospectus (the “Prospectus,” and together with the Registration Statement, the “Offering Documents”) with the Securities Exchange Commission in connection with the Offering;
WHEREAS, the Empery Funds claim that the Offering Documents contained untrue statements of material fact, omitted material facts, and failed to make adequate disclosures concerning the imposition of a hold by the Food and Drug Administration relating to certain clinical trials that Kiromic was conducting;
WHEREAS, on March 7, 2022, the Empery Funds filed an action against Kiromic and the Individual Defendants in the United States District Court for the Southern District of New York, entitled Sabby Volatility Warrant Master Fund Ltd., et al. v. Kiromic Biopharma Inc, et al., Civil Action No. 1:22-cv-01927, alleging violations of Sections 11, 12(a)(2) and 15 of the Securities Act (the “Action”);
WHEREAS, on July 22, 2022, the Empery Funds amended their complaint against Kiromic (the “Amended Complaint”), to add, among other things, ThinkEquity LLC (“ThinkEquity”) as a defendant;
WHEREAS, the Defendants (with the exception of ThinkEquity) moved to dismiss the Amended Complaint on September 22, 2022, and ThinkEquity filed an answer on September 17, 2022;
WHEREAS, the Defendants deny the allegations in the Amended Complaint and maintain that the Offering Documents complied in all respects with the Securities Act of 1933, the rules and regulations thereunder, and all other applicable law;
| | |
WHEREAS, the Parties (with the exception of ThinkEquity) desire to fully settle and resolve all issues and claims that relate in any way to the allegations set forth in the Action without the admission of any fault or liability on the part of any of the Parties;
WHEREAS, the Parties entered into the initial Stipulation of Settlement and Mutual Release on October 9, 2022 (the “Initial Agreement”);
WHEREAS, prior to the execution of the Initial Agreement by all Parties, the Empery Funds voluntarily dismissed their claims against ThinkEquity without prejudice;
AND WHEREAS, the Parties, each acting on his or its own behalf and having been represented by counsel, have approved the Initial Agreement and the amended settlement terms described below (the “Amended Agreement”);
NOW, THEREFORE, in consideration of and in return for the promises and covenants undertaken by the Parties herein and the releases given herein, the adequacy of which consideration is acknowledged, the Parties agree as follows:
| | |
| | |
| | |
| | |
If to the Empery Funds:
c/o Empery Asset Management, LP
1 Rockefeller Plaza, Suite 1205
New York, NY 10020
Attention: Ryan M. Lane
| | |
Telephone: +1(212) 608-3300
Email: notices@emperyam.com
With a copy (for informational purposes only) to:
Andrew Gladstein
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Telephone:(212) 756-2000
Facsimile:(212) 593-5955
E-mail:andrew.gladstein@srz.com
If to Kiromic:
Kiromic Biopharma Inc.
Attention: Pietro Bersani, Chief Executive Officer
7707 Fannin, Suite 140
Houston, TX 77054
Telephone:(832) 968-4888
E-mail:pbersani@kiromic.com
With a copy (for informational purposes only) to:
Hogan Lovells US LLP 390 Madison Ave.
New York, NY 10017 Attention: William M. Regan, Esq. Telephone: (212) 918-3000
E-Mail: William.Regan@hoganlovells.com
| | |
| | |
IN WITNESS WHEREOF, the Parties have caused this Amended Agreement to be executed by themselves or their duly authorized representatives on the respective dates set forth below.
EMPERY ASSET MASTER, LTD.
By: Empery Asset Management, LP
By: ____________________
Name: Brett Director
Title: General Counsel
Date:
EMPERY TAX EFFICIENT, LP
By: Empery Asset Management, LP
By: ____________________
Name: Brett Director
Title: General Counsel
Date:
EMPERY TAX EFFICIENT III, LP
By: Empery Asset Management, LP
By: ____________________
Name: Brett Director
Title: General Counsel
Date:
KIROMIC BIOPHARMA, INC.
By: ____________________
Name: Pietro Bersani
Title: Chief Executive Officer
Date:
Americo Cicchetti
____________________
Name: Americo Cicchetti
Date:
| | |
Michael Nagel
____________________
Name: Michael Nagel
Date:
Jerry Schneider
____________________
Name: Jerry Schneider
Date:
Pietro Bersani
____________________
Name: Pietro Bersani
Date:
Gianluca Rotino
____________________
Name: Gianluca Rotino
Date:
Tony Tontat
____________________
Name: Tony Tontat
Date:
| | |
Maurizio Chiriva-Inernati
____________________
Name: Maurizio Chiriva-Inernati
Date:
| |
| |
| | |
AMENDED STIPULATION OF SETTLEMENT AND MUTUAL RELEASE
WHEREAS, on July 2, 2021, Sabby Volatility Warrant Master Fund Ltd. (“Sabby”) participated in a public offering by Kiromic Biopharma, Inc. (“Kiromic” or the “Company”) pursuant to which Sabby purchased an aggregate of 500,000 shares of common stock, par value $0.001 per share (“Common Stock”) of Kiromic for $2.5 million (the “Offering”);
WHEREAS, on June 25, 2021, Kiromic filed a registration statement (the “Registration Statement”) with the Securities Exchange Commission in connection with the Offering, signed by Maurizio Chiriva-Internati, Tony Tontat, Gianluca Rotino, Pietro Bersani, Americo Cicchetti, Michael Nagel, and Jerry Schneider (collectively, the “Individual Defendants,” and together with Kiromic and ThinkEquity (as defined below), the “Defendants”);
WHEREAS, on June 29, 2021, Kiromic filed a final prospectus (the “Prospectus,” and together with the Registration Statement, the “Offering Documents”) with the Securities Exchange Commission in connection with the Offering;
WHEREAS, Sabby claims that the Offering Documents contained untrue statements of material fact, omitted material facts, and failed to make adequate disclosures concerning the imposition of a hold by the Food and Drug Administration relating to certain clinical trials that Kiromic was conducting;
WHEREAS, on March 7, 2022, Sabby and its co-plaintiffs Empery Asset Master, Ltd, Empery Tax Efficient, LP and Empery Tax Efficient III, LP (collectively with Sabby, “Plaintiffs”) filed an action against Kiromic and the Individual Defendants in the United States District Court for the Southern District of New York, entitled Sabby Volatility Warrant Master Fund Ltd. et al. v. Kiromic Biopharma, Inc., et al., Civil Action No. 1:22-cv-01927, alleging violations of Sections 11, 12(a)(2) and 15 of the Securities Act (the “Action”);
WHEREAS, on July 22, 2022, the Plaintiffs amended their complaint against Kiromic (the “Amended Complaint”), to add, among other things, ThinkEquity LLC (“ThinkEquity”) as a defendant;
WHEREAS, the Defendants (with the exception of ThinkEquity) moved to dismiss the Amended Complaint on September 22, 2022, and ThinkEquity filed an answer on September 17, 2022;
WHEREAS, the Defendants deny the allegations in the Amended Complaint and maintain that the Offering Documents complied in all respects with the Securities Act of 1933, the rules and regulations thereunder, and all other applicable law;
WHEREAS, the Plaintiffs and Defendants (the “Parties”) desire to fully settle and resolve all issues and claims that relate in any way to the allegations set forth in the Action without the admission of any fault or liability on the part of any of the Parties;
| | |
WHEREAS, the Parties entered into the initial Stipulation of Settlement and Mutual Release on October 9, 2022 (the “Initial Agreement”);
WHEREAS, prior to the execution of the Initial Agreement by all Parties, Sabby voluntarily dismissed their claims against ThinkEquity without prejudice;
AND WHEREAS, the Parties, each acting on his or its own behalf and having been represented by counsel, have approved the Initial Agreement and the amended settlement terms described below (the “Amended Agreement”);
NOW, THEREFORE, in consideration of and in return for the promises and covenants undertaken by the Parties herein and the releases given herein, the adequacy of which consideration is acknowledged, the Parties agree as follows:
| | |
| | |
| | |
| | |
If to Sabby:
c/o Sabby Management, LLC
115 Hidden Hills Drive
Spicewood, Texas 78669
Attention: Robert Grundstein, General Counsel
Telephone: (646) 307-4500
Email: rgrundstein@sabbymanagement.com
With a copy (for informational purposes only) to:
Thomas Fleming
Olshan Frome Wolosky LLP
1325 Avenue of the Americas
New York, New York 10019
Telephone:(212) 451-2300
Facsimile:(212) 451-2222
E-mail:tfleming@olshanlaw.com
If to Kiromic:
Kiromic Biopharma Inc.
Attention: Pietro Bersani, Chief Executive Officer
7707 Fannin, Suite 140
Houston, TX 77054
Telephone:(832) 968-4888
E-mail:pbersani@kiromic.com
With a copy (for informational purposes only) to:
Hogan Lovells US LLP 390 Madison Ave.
New York, NY 10017 Attention: William M. Regan, Esq. Telephone: (212) 918-3000
E-Mail: William.Regan@hoganlovells.com
| | |
| | |
IN WITNESS WHEREOF, the Parties have caused this Amended Agreement to be executed by themselves or their duly authorized representatives on the respective dates set forth below.
SABBY VOLATILITY WARRANT MASTER FUND LTD.
By: Sabby Management, LLC
By: ____________________
Name: Robert Grundstein
Title: General Counsel
Date:
KIROMIC BIOPHARMA, INC.
By: ____________________
Name: Pietro Bersani
Title: Chief Executive Officer
Date:
Americo Cicchetti
____________________
Name: Americo Cicchetti
Date:
Michael Nagel
____________________
Name: Michael Nagel
Date:
Jerry Schneider
____________________
Name: Jerry Schneider
Date:
| | |
Pietro Bersani
____________________
Name: Pietro Bersani
Date:
Gianluca Rotino
____________________
Name: Gianluca Rotino
Date:
Tony Tontat
____________________
Name: Tony Tontat
Date:
Maurizio Chiriva-Inernati
____________________
Name: Maurizio Chiriva-Inernati
Date:
| |
| | |