Item 1.01 Entry into a Material Definitive Agreement.
On November 23, 2021, Aridis Pharmaceuticals, Inc. (the "Company") entered into
a note purchase agreement (the "Note Purchase Agreement") with Streeterville
Capital, LLC (the "Investor"), pursuant to which we issued to the Investor a
secured promissory note (the "Note") in the aggregate principal amount of
$5,250,000. Closing occurred on November 23, 2021 (the "Issuance Date"). The
Note carries an original issue discount of $250,000. The Note bears interest at
the rate of 6% per annum and matures on November 23, 2023. Beginning on May 23,
2021, the Investor has the right to redeem all or any portion of the Note up to
the Maximum Monthly Redemption Amount which is $450,000. Payments of each
redemption amount must be made in cash. Pursuant to the Note, the Company can
defer all redemption payments that the Investor could otherwise elect to make
during any calendar month on three (3) separate occasions by providing written
notice to Investor at least three (3) trading days prior to the first day of
each such calendar month for which it wishes to defer redemptions for that
month. In the event the Company elects to defer, the aggregate principal amount
plus accrued but unpaid interest ("Outstanding Amount") shall automatically be
increased by (a) 0.5% for the first exercise; (b) 1% for the second exercise and
(c) 1.5% for the third exercise. The Company can prepay all or any portion of
the Outstanding Amount at a rate of 105% of the portion of the Outstanding
Balance Company elects to prepay if prepayment occurs on or before the
three-month anniversary of the Issuance Date; (b) 107.5% of the portion of the
Outstanding Balance Company elects to prepay if prepayment occurs after the
three-month anniversary of the Issuance Date but on or before the six-month
anniversary of the Issuance Date and (c) 110% of the Outstanding Balance if the
prepayment occurs after the six-month anniversary of the Issuance Date.
Provided that there is no material breach of the Note Purchase Agreement or
event of default, on February 21, 2022, the Company will issue a second Note to
the Investor in the aggregate principal amount of $5,250,000 which shall be
substantially similar to the Note except the maturity date will be February 21,
2024.
Pursuant to the Note Purchase Agreement, we are subject to certain covenants,
including the obligations to: (i) timely file all reports required to be filed
under Sections 13 or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and not terminate its status as an issuer required to file
reports under the Exchange Act; (ii) maintain listing of our common stock on a
securities exchange; and (iii) avoid trading in our common stock from being
suspended, halted, chilled, frozen or otherwise ceased.
In addition, pursuant to the Security Agreement dated November 23, 2021 between
the Company and the Investor, the Note is secured by the Company's MabIgX
assets.
The foregoing descriptions of the Note Purchase Agreement, the Security
Agreement and the Note do not purport to be complete and are qualified in their
entirety by reference to the full text of the Note Purchase Agreement, the
Security Agreement and the Note, forms of which are attached as Exhibit 10.1,
10.2 and 4.1, respectively, to this Current Report on Form 8-K, 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 included in Item 1.01 of this Form 8-K is hereby incorporated by
reference into this Item 2.03.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
4.1 Form of Secured Promissory Note
10.1 Note Purchase Agreement dated as of November 23, 2021
10.2 Security Agreement dated as of November 23, 2021
Cover Page Interactive File (the cover page tags are embedded within the
104 Inline XBRL document)
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