Item 1.01 Entry into a Material Definitive Agreement.
Maturity Extension and Forbearance Agreement
On May 6, 2020 Ameri Holdings, Inc., a Delaware corporation (the "Company")
entered into a Maturity Extension and Forbearance Agreement ("Agreement") with
the holder of the Company's 5% convertible promissory notes, in the aggregate
face amount of $1,500,000, issued on November 26, 2019 and January 14, 2020
(each a "Debenture" and collectively, the "Debentures"). Pursuant to the
Agreement (i) the holder agreed to extend the Maturity Date of the Debentures to
from May 26, 2020 to September 30, 2020, (ii) the Company may now prepay each
Debenture at any time, with accrued interest to the date of such payment, but no
other premium or penalty, and (iii) the parties changed the definition of
"Permitted Indebtedness" in the Debentures so as to permit indebtedness issued
pursuant to the Coronavirus Aid, Relief, and Economic Security (CARES) Act or
related or similar governmental programs including disaster-relief or
pandemic-relief programs designed to help businesses in the wake of the
Coronavirus pandemic. In consideration for entering into the Agreement the
Company agreed to issue to the holder a prepaid warrant (the "Warrant") to
purchase up to 646,094 shares of the Company's common stock. The Warrant shall
be exercisable, commencing on May 6, 2020 until exercised in full, at a price of
$0.001 per share, and shall also be exercisable on a cashless basis. The holder
of the Warrant will not have the right to exercise any portion of its Warrant if
the holder, together with its affiliates, would beneficially own in excess of
4.99% (or at the election of a holder prior to the date of issuance, 9.99%) of
the number of shares of Common Stock outstanding immediately after giving effect
to such exercise (the "Beneficial Ownership Limitation"); provided, however,
that upon 61 days' prior notice to the Company, the holder may increase the
Beneficial Ownership Limitation, but not to above 9.99%. The exercise price and
number of shares of Common Stock issuable upon the exercise of the Warrant will
be subject to adjustment in the event of any stock dividend, stock split,
reverse stock split, certain subsequent rights offerings, recapitalization,
reorganization or similar transaction, as described in the Warrant.
The Warrant will not be listed for trading on any national securities exchange.
The Warrant and the shares issuable upon exercise of the Warrant (the "Warrant
Shares") are not currently registered under the Securities Act of 1933, as
amended (the "Securities Act").
The Company also agreed, pursuant to a Registration Rights Agreement, to file a
registration statement on Form S-3 (or other appropriate form if the Company is
not then S-3 eligible) by the second trading day following the effective date of
the Company's registration statement on Form S-4 with respect to the acquisition
of Jay Pharma Inc. by the Company (as announced on Form 8-K dated January 10,
2020) to provide for the resale of the Warrant Shares, and will be obligated to
use commercially reasonable efforts to cause such registration to become
effective within 30 days following the filing date and to keep such registration
statement effective until the date (i) upon which the holder no longer owns the
Warrant or any Warrant Shares or (ii) the Warrant Shares may be sold without
volume or manner-of-sale restrictions pursuant to Rule 144 and without the
requirement for the Company to be in compliance with the current public
information requirement under Rule 144.
The foregoing descriptions of the material terms of the Maturity Extension and
Forbearance Agreement, the Registration Rights Agreement and the Warrant do not
purport to be complete and are qualified in their entirety by reference to the
full text of the Maturity Extension and Forbearance Agreement, the Registration
Rights Agreement and the Warrant, copies of which are filed herewith as Exhibits
10.1, 10.2 and 10.3, respectively, and are incorporated herein by reference.
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Amalgamation Amendment Agreement
On May 6, 2020, the Company entered into an Amalgamation Amendment Agreement
(the "Amendment") to amend that certain Amalgamation Agreement dated January 10,
2020, by and between Ameri Holdings, Inc., Jay Pharma Merger Sub, Inc. ("Merger
Sub"), Jay Pharma Inc. ("Jay Pharma"), Jay Pharma ExchangeCo, Inc.
("ExchangeCo"), and Barry Kostiner (the "Amalgamation Agreement"). Pursuant to
the Amendment, the parties agreed that (i) at the Effective Time, Ameri
Holdings, Inc. shall issue to the holder of a certain note issued by Jay Pharma,
series B warrants (the "Series B Warrants") to acquire 8,100,000 shares of
common stock of the company resulting from the amalgamation, and (ii) providing
for certain registration rights, pursuant to a Registration Statement on Form
S-4, of the Series B Warrants and the shares issuable upon exercise of the
Series B Warrants. The Series B Warrants shall be exercisable for a period of
five years commencing on the ninetieth (90th) day after the later of the last
day of the Lock-up Period and leak-out Period (accelerated or otherwise) set
forth in the Lock-up agreement to be executed by the holders of Jay Pharma
securities in connection with the Amalgamation, at a price of $0.01 per share,
and shall also be exercisable on a cashless basis.
The holder of the Series B Warrant will not have the right to exercise any
portion of its Series B Warrant if the holder, together with its affiliates,
would beneficially own in excess of 9.99% of the number of shares of Common
Stock outstanding immediately after giving effect to such exercise (the
"Beneficial Ownership Limitation"). The exercise price and number of shares of
Common Stock issuable upon the exercise of the Series B Warrant will be subject
to adjustment in the event of any stock dividend, stock split, reverse stock
split, certain subsequent rights offerings, recapitalization, reorganization or
similar transaction, as described in the Series B Warrant.
The foregoing descriptions of the material terms of the Amalgamation Amendment
Agreement and the Series B Warrant do not purport to be complete and are
qualified in their entirety by reference to the full text of the Amalgamation
Amendment Agreement and the Series B Warrants, copies of which are filed
herewith as Exhibits 10.4 and 10.5, respectively, and are incorporated herein by
reference.
Note Amendment Agreement
On May 6, 2020, Jay Pharma Inc. (the "Borrower") entered into a Note Amendment
Agreement ("Note Amendment") with the holder of a certain secured promissory
note dated January 10, 2020, in the principal amount of $1,500,000 (the "Note").
Pursuant to the Note Amendment, (i) the parties agreed to extend the maturity
date of the Note to the earliest of (a) September 30, 2020, and (b) the date on
which all amounts under the Note shall become due and payable.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The information provided in Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
Item. 3.02 Unregistered Sales of Equity Securities.
On May 6, 2020, pursuant to the Maturity Extension and Forbearance Agreement
described in Item 1.01 of this Current Report on Form 8-K, the Company agreed to
issue the Warrant to the holder of the Debentures. The issuance of the Warrant
was made in reliance upon the exemption from registration under the Securities
Act of 1933, as amended, afforded by Section 4(a)(2) and Rule 506 of Regulation
D promulgated thereunder.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
10.1 Form of Maturity Extension and Forbearance Agreement, dated May 6, 2020
10.2 Form of Registration Rights Agreement, dated May 6, 2020
10.3 Form of Pre-Funded Warrant, dated May 6, 2020
10.4 Form of Amalgamation Amendment Agreement, dated May 6, 2020, by and
between AMERI Holdings, Inc., Jay Pharma Merger Sub, Inc., Jay Pharma
Inc., Jay Pharma ExchangeCo, Inc. and Barry Kostiner.
10.5 Form of Series B Warrant, dated May 6, 2020
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