Item 1.01 Entry into a Material Definitive Agreement
On October 12, 2022, Statera Biopharma, Inc. (the "Company") entered a Binding
Memorandum of Understanding ("MOU") with Holobeam Technologies, Inc. ("HOLO"),
pursuant to which the Company will acquire a minority interest of twenty-five
percent in HOLO for $25 million via the issuance of the Company's preferred
stock or a combination of preferred stock and cash (the "Equity Investment").
In exchange, HOLO will provide a license to the Company to use their technology
platform for the identification and treatment of diseases (together with the
Equity Investment, the "Transaction"). Furthermore, HOLO will be provided two
board seats on the board of directors of the Company upon the consummation of
the Transaction. The MOU provides for an exclusivity period of sixty (60) days
(the "Exclusivity Period") for negotiating and finalizing a definitive stock
purchase agreement and technology license (the "Definitive Agreement"). The
consummation of the Transaction is subject to certain closing conditions,
including but not limited to the availability of at least $10 million on the
balance sheet of the Company at the close of the Transaction for the development
of HOLO's technology and general working capital, approval of the Transaction by
a majority of HOLO's stockholders and the Company's board of directors, receipt
of a fairness opinion by HOLO from an investment bank of its choosing and other
customary conditions.
The foregoing summary of the MOU does not purport to be complete and is subject
to, and qualified in its entirety by, the MOU attached as Exhibit 10.1 to this
Current Report on Form 8-K, which exhibit is incorporated herein by reference.
Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
On October 11, 2022, the Company received notice from the Listing Qualifications
Staff (the "Staff") of The Nasdaq Stock Market LLC ("Nasdaq") indicating that,
based upon information set forth in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2021 (the "Form 10-K"), the Company does not
satisfy the $2.5 million stockholders' equity requirement for continued listing
on The Nasdaq Capital Market, as required by Nasdaq Listing Rule 5550(b)(1),
which could serve as an additional basis for the delisting of the Company's
securities from Nasdaq. The Company addressed the stockholders' equity
deficiency and its plan to regain compliance with that requirement at its recent
hearing before the Nasdaq Hearings Panel (the "Panel") along with its plan to
evidence full compliance with Nasdaq's filing and bid price requirements, as set
forth in Nasdaq Listing Rules 5250(c)(1) and 5550(a)(2), respectively. The Panel
has not yet issued a determination as a result of the hearing.
The Staff also determined that the Company's failure to submit a "listing of
additional shares" notification form ("LAS Form") to Nasdaq at least 15 days in
advance of the issuance of shares totaling 10% or more of the Company's
pre-issuance shares outstanding in September 2022 constituted a violation of
Nasdaq Listing Rule 5250(c)(2)(D) (the "LAS Rule"), which could also serve as a
basis for delisting from Nasdaq. The Staff's determination was based upon the
Company's disclosure under the "Subsequent Events" section of the "Notes to
Consolidated Financial Statements" set forth in the Form 10-K (note 19), which
indicated that:
In September 2022, the Company executed multiple subscription agreements
pursuant to which the Company sold 4.75 million shares of its common stock for
approximately $0.36 million and issued warrants to purchase approximately
9.5 million shares of common stock. The purchase price for one share of common
stock and two warrants was $0.075. The warrants are exercisable immediately,
have an exercise price of $0.15 per share, and will expire two years from the
initial exercise date. The proceeds of the offering will be used for general
corporate purposes.
The above disclosure included in the Form 10-K was made in error. Although the
Company has received multiple subscription agreements from potential investors
for the financing as described, the Company has not yet executed the relevant
subscription agreements and has not issued any shares or warrants in connection
with those agreements. Given the plain language of Nasdaq Listing Rule
5250(c)(2)(D) and because no shares have yet been issued, the Company does not
believe it violated the LAS Rule. In the event the Company determines to move
forward with the financing, the Company intends to promptly file an LAS Form
with Nasdaq and to promptly announce the completion of the offering.
In addition to the above-referenced financing, the Company is also pursuing
additional fundraising activities to address the stockholders' equity issue. The
Company is committed to the timely submission of all necessary notifications to
Nasdaq and the timely and accurate disclosure of its financing activities to the
public.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements that are
based on management's beliefs and assumptions and on information currently
available to the Company's management. Forward-looking statements include
statements regarding the Company's expectations regarding the submission of a
compliance plan to Nasdaq. Forward-looking statements include statements that
are not historical facts and can be identified by terms such as "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may," "plan," "potential,"
"predict," "project," "seek," "should," "will," "would" or similar expressions
and the negatives of those terms. The Company's actual results and the timing of
events could materially differ from those anticipated in such forward-looking
statements as a result of certain risks and uncertainties including those
described in more detail in the Company's most recent Annual Report on Form 10-K
and other documents on file with the SEC, each of which can be found on the
SEC's website, www.sec.gov, or the investor relations portion of the Company's
website, https://ir.staterabiopharma.com/financial-information/sec-filings.
Except as required by law, the Company assumes no obligation to update these
forward-looking statements, or to update the reasons actual results could differ
materially from those anticipated in these forward-looking statements, even if
new information becomes available in the future.
Item 9.01 Financial Statements and Exhibits
Exhibit No. Description
10.1 Memorandum of Understanding, dated October 12, 2022, between
Statera Biopharma, Inc. and Holobeam Technologies, Inc.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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