Item 1.01 Entry into a Material Definitive Agreement.
On May 9, 2023, PharmaCyte Biotech, Inc. (the "Company") entered into a
Securities Purchase Agreement (the "Purchase Agreement") with certain accredited
investors (the "Investors"), pursuant to which it agreed to sell to the
Investors (i) an aggregate of 35,000 shares of the Company's newly-designated
Series B convertible preferred stock with a stated value of $1,000 per share,
initially convertible into up to 8,750,000 shares of the Company's common stock,
par value $0.0001 per share (the "Common Stock") at a conversion price of $4.00
per share (the "Preferred Shares"), and (ii) warrants to acquire up to an
aggregate of 8,750,000 shares of Common Stock (the "Warrants") (collectively,
the "Private Placement").
The Private Placement is exempt from the registration requirements of the
Securities Act pursuant to the exemption for transactions by an issuer not
involving any public offering under Section 4(a)(2) of the Securities Act of
1933, as amended (the "Securities Act") and Rule 506 of Regulation D of the
Securities Act and in reliance on similar exemptions under applicable state
laws. Each of the Investors has represented to the Company that it is an
accredited investor within the meaning of Rule 501(a) of Regulation D and that
it is acquiring the securities for investment only and not with a view towards,
or for resale in connection with, the public sale or distribution thereof. The
Preferred Shares and Warrants are being offered without any general solicitation
by the Company or its representatives.
The closing of the Private Placement occurred on May 10, 2023. The aggregate
gross proceeds from the Private Placement were approximately $35 million. The
Company expects to use the net proceeds from the Private Placement for general
corporate purposes.
The Purchase Agreement contains certain representations and warranties,
covenants and indemnities customary for similar transactions. The
representations, warranties and covenants contained in the Purchase Agreement
were made solely for the benefit of the parties to the Purchase Agreement and
may be subject to limitations agreed upon by the contracting parties.
In connection with the Private Placement, pursuant to an Engagement Letter,
dated May 9, 2023, between the Company and Katalyst Securities LLC (the
"Placement Agent"), the Company has agreed to pay the Placement Agent a cash fee
equal to 6% of the gross proceeds from any sale of securities in the Private
Placement.
Preferred Shares
The terms of the Preferred Shares are as set forth in the Certificate of
Designations, which was filed with the Secretary of State of the State of Nevada
on May 10, 2023 and is attached as Exhibit 4.1 to this Current Report on Form
8-K (the "Certificate of Designations"). The Preferred Shares will be
convertible into Common Stock (the "Conversion Shares") at the election of the
holder at any time at an initial conversion price of $4.00 (the "Conversion
Price"). The Conversion Price is subject to customary adjustments for stock
dividends, stock splits, reclassifications and the like, and subject to
price-based adjustment in the event of any issuances of Common Stock, or
securities convertible, exercisable or exchangeable for Common Stock, at a price
below the then-applicable Conversion Price (subject to certain exceptions). The
Company will be required to redeem the Preferred Shares in equal monthly
installments, commencing on November 9, 2023. The amortization payments due upon
such redemption are payable, at the company's election, in cash, or subject to
certain limitations, in shares of common stock valued at the lower of (i) the
Conversion Price then in effect and (ii) the greater of (A) a 20% discount to
the average of the three lowest closing prices of the Company's common stock
during the thirty trading day period immediately prior to the date the
amortization payment is due or (B) the lower of $0.556 and 20% of the Minimum
Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) on the
date of receipt of Nasdaq Stockholder Approval (as defined below); provided that
if the amount set forth in clause B is the lowest effective price, the Company
will be required to pay the amortization payment in cash. The Company may
require holders to convert their Preferred Shares into Conversion Shares if the
closing price of the Common Stock exceeds $6.00 per share for 20 consecutive
trading days and the daily trading volume of the Common Stock exceeds 1,000,000
shares per day during the same period and certain equity conditions described in
the Certificate of Designations are satisfied.
1
The holders of the Preferred Shares will be entitled to dividends of 4% per
annum, compounded monthly, which will be payable in cash or shares of Common
. . .
Item 3.02 Unregistered Sales of Equity Securities
The matters described in Section 1.01 of this Current Report on Form 8-K related
to the Private Placement are incorporated herein by reference. In connection
with the issuance of the Preferred Shares and Warrants in the Private Placement
described in Item 1.01, the Company relied upon the exemption from registration
provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and
Regulation D promulgated thereunder for transactions not involving a public
offering.
This report shall not constitute an offer to sell or a solicitation of an offer
to buy nor shall there be any sale of these securities in any state or
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to the registration or qualification under the securities laws of any such state
or jurisdiction.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
The matters described in Section 1.01 of this Current Report on Form 8-K related
to the Preferred Shares and the Certificate of Designations are incorporated
herein by reference.
Item 5.07 Submission of Matters to a Vote of Security Holders.
As previously disclosed, on December 28, 2022, the Company held its 2022 annual
meeting of stockholders (the "Annual Meeting") via live webcast. At the Annual
Meeting, a majority of votes were cast in favor of holding non-binding advisory
votes on the compensation of the Company's named executive officers every year.
In accordance with these results and the previous recommendation of the
Company's board of directors (as set forth in the Company's Definitive Proxy
Statement on Schedule 14A filed with the Commission on November 25, 2022), the
Company intends to hold such votes every year until the next required vote on
the frequency of stockholder advisory votes on the compensation of the Company's
named executive officers, which will be no later than the Company's annual
meeting of stockholders in 2028.
Item 8.01. Other Events.
On May 11, 2023, the Company issued a press release announcing (i) the Private
Placement and (ii) that the Company intends to commence, on May 11, 2023, a
tender offer to purchase for cash up to 7,750,000 shares of its Common Stock,
less any applicable withholding taxes and without interest.
The press release attached hereto as Exhibit 99.1 is for informational purposes
only and is neither an offer to purchase nor a solicitation of an offer to sell
securities. The tender offer described in this Current Report on Form 8-K and in
Exhibit 99.1 has not yet commenced. The solicitation of offers to buy shares of
Common Stock will only be made pursuant to an Offer to Purchase and other
related documents that the Company will send to its stockholders once the tender
offer has commenced. Stockholders of the Company are urged to read these
materials when they become available, as well as any other relevant documents
filed with the SEC when they become available, carefully and in their entirety
because they will contain important information, including the terms and
conditions of the tender offer. Those materials will be distributed by the
Company to the Company's stockholders at no expense to them.
Upon commencement of the tender offer, the Company will file the Offer to
Purchase and other related documents with the SEC, and, when available,
investors may obtain them for free from the SEC at its website (www.sec.gov) or
free of charge from the Company as described in Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Number Description
3.1 Certificate of Designations
4.1 Form of Warrant
10.1 Form of Purchase Agreement
10.2 Form of Registration Rights Agreement
10.3 Engagement Letter, dated May 9, 2023 by and between Synaptogenix, Inc.
and Katalyst Securities LLC
99.1 Press Release
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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PHARMACYTE BIOTECH, INC. 
