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As filed with the Securities and Exchange Commission on December 31, 2015

Registration No. 333-            

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

PROVECTUS BIOPHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   2834   90-0031917

(State or jurisdiction of

incorporation or organization)

 

(Primary Standard Industrial

classification Code)

 

(I.R.S. Employer

Identification No.)

7327 Oak Ridge Highway, Suite A

Knoxville, Tennessee 37931

(866) 594-5999

(Address and telephone number of registrant’s principal executive offices and principal place of business)

 

 

Timothy C. Scott, Ph.D., President

Provectus Biopharmaceuticals, Inc.

7327 Oak Ridge Highway, Suite A

Knoxville, Tennessee 37931

Telephone: (866) 594-5999

(Name, address and telephone number of agent for service)

 

 

Copies to:

Tonya Mitchem Grindon, Esq.

Lori B. Metrock, Esq.

Baker, Donelson, Bearman,

Caldwell & Berkowitz, PC

211 Commerce Street

Suite 800

Nashville, Tennessee 37201

(615) 726-5600

 

 

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement has become effective.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.   ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. (Check one):

 

Large accelerated filer   ¨    Accelerated filer   x
Non-accelerated filer   ¨   (Do not check if a smaller reporting company)    Smaller reporting company   ¨

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)   ¨

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)   ¨

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of each class of

securities to be registered

 

Amount

to be

registered

 

Proposed

maximum

offering price
per unit

 

Proposed

maximum

aggregate

offering price

 

Amount of

registration fee

Common Stock, par value $0.001 per share, underlying Existing Warrants

  59,861,601   $0.75 (1)   $44,896,200.75 (1)   $4,521.05 (1)

Replacement Warrants

  59,861,601 (2)   —   (2)   —   (2)   —   (2)

Common Stock, par value $0.001 per share, underlying the Replacement Warrants

  59,861,601 (3)   $1.11 (4)   $66,446,377.11 (4)   $6,691.15 (4)

TOTAL

          $111,342,577.86   $11,212.20

 

 

(1) Calculated pursuant to Rule 457(g) based on the reduced exercise price of the Registrant’s outstanding warrants issued by the Registrant between January 6, 2011 and November 1, 2015 (the “Existing Warrants”) in transactions exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Warrant Exchange Transaction described herein.
(2) Represents the maximum number of Replacement Warrants (as defined below) to be issued to certain holders of the Existing Warrants. Pursuant to Rule 457(g), no separate registration fee is required for the Replacement Warrants.
(3) Pursuant to Rule 416, the number of shares of common stock, par value $0.001 per share, of the Registrant (the “Common Stock”) being registered shall include an indeterminate number of shares of Common Stock that may be issued pursuant to the antidilution provisions of the warrants.
(4) Calculated pursuant to Rule 457(i) of the Securities Act, based upon the per share exercise price of $0.85 for the Common Stock underlying the warrants expiring June 19, 2020 that will be issued pursuant to the Warrant Exchange Transaction described in the prospectus to which this Registration Statement relates (the “Replacement Warrants”) plus the price per Replacement Warrant, based on the average of the high and low prices of the Registrant’s warrants trading under the symbol “PVCTWS” on the NYSE MKT on December 28, 2015, which warrants are of the same class as the Replacement Warrants, pursuant to Rule 457(c).

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 


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A registration statement relating to these securities has been filed with the Securities and Exchange Commission. The information in this prospectus may change. We may not complete the exchange offer and issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer is not permitted, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.

 

Subject to change, dated December 31, 2015

OFFER LETTER/PROSPECTUS

LOGO

OFFER TO HOLDERS OF

FIVE-YEAR COMMON STOCK WARRANTS OF PROVECTUS BIOPHARMACEUTICALS, INC.

TO RECEIVE UPON EXERCISE OF SUCH WARRANTS, IN ADDITION TO THE COMMON STOCK PURCHASED, AN EQUAL NUMBER OF NEW $0.85 COMMON STOCK WARRANTS EXPIRING JUNE 19, 2020 (THE “REPLACEMENT WARRANTS”)

AND

PROSPECTUS FOR (i) 59,861,601 SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THE EXISTING WARRANTS, (ii) THE REPLACEMENT WARRANTS and (iii) 59,861,601 SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THE REPLACEMENT WARRANTS

 

 

THE EXCHANGE OFFER EXPIRES AT 4:00 P.M., EASTERN TIME,

ON FEBRUARY 15, 2016 UNLESS WE EXTEND THE OFFER

 

 

The Offer

For a limited period of time, Provectus Biopharmaceuticals, Inc. (“we,” “us,” or the “Company”) is offering to certain of its holders of outstanding warrants the opportunity to receive new warrants expiring June 19, 2020 upon the exercise of their warrants (the “Exchange Offer” or the “Offer”). The Offer is being made to certain holders of our warrants to purchase shares of common stock, $0.001 par value per share (“Common Stock”), issued between January 6, 2011 and November 1, 2015 (the “Existing Warrants”) in transactions exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Offer is to temporarily modify the terms of such Existing Warrants so that each holder who tenders Existing Warrants during the Offer Period (as defined below) for early exercise will be able to do so at a discounted exercise price of $0.75 per share (Existing Warrants currently have exercise prices ranging between $1.00 and $3.00 per share). The Company will receive all of the proceeds from the exercise of the Existing Warrants. During the Offer Period, each Existing Warrant holder who tenders Existing Warrants for exercise will receive, in addition to the shares of Common Stock purchased upon exercise, new warrants expiring June 19, 2020 to purchase an equal number of shares of our Common Stock at an exercise price of $0.85 per share (each, a “Replacement Warrant” and collectively the “Replacement Warrants”). Such exchange of Existing Warrants for shares of Common Stock and Replacement Warrants on the terms described herein is referred to in this Offer Letter/Prospectus as the “Warrant Exchange Transaction.”

We are offering pursuant to this Offer Letter/Prospectus 59,861,601 shares of our Common Stock for issuance upon exercise of the Existing Warrants. The terms of each of the Existing Warrants are substantially identical to each other except for the exercise prices and the expiration dates of the Existing Warrants.

We are also offering pursuant to this Offer Letter/Prospectus 59,861,601 Replacement Warrants and 59,861,601 shares of our Common Stock for issuance upon exercise of the Replacement Warrants. The terms of the Replacement Warrants will be identical to the terms of the warrants we issued in connection with our public offering of Common Stock and warrants (the “June 2015 Warrants”) that we completed on June 24, 2015 (the “June 2015 Offering”). The June 2015 Warrants began trading on the NYSE MKT LLC (the “NYSE MKT”) under the ticker symbol “PVCTWS” on June 22, 2015. At this time, only the June 2015 Warrants are listed on NYSE MKT, and there is currently no public market for our Existing Warrants. The June 2015 Warrants have an exercise price of $0.85 per share, are exercisable immediately and will expire on June 19, 2020. We intend to list the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants on the NYSE MKT after the closing of this Offer. However, there can be no assurance that the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants will be approved for listing on the NYSE MKT.


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The Offer is made upon the terms and conditions in this Offer Letter/Prospectus and related Letter of Transmittal. The Offer will be open until February 15, 2016 at 4:00 p.m. Eastern Time, unless earlier withdrawn or otherwise extended by the Company (the period during which the Offer is open, giving effect to any withdrawal or further extension, is referred to herein as the “Offer Period”). The Offer is not made to those holders who reside in states or other jurisdictions where an offer, solicitation or sale would be unlawful. We will pay no interest on the cash tendered for the exercise price of the Existing Warrants regardless of any extension of, or amendment to, the Offer or any delay. The Company may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, the Company will return the tendered Existing Warrants along with the cash delivered therewith.

You may tender some or all of your Existing Warrants on the terms set forth herein. If you elect to tender Existing Warrants in response to this Offer, please follow the instructions in this document and the related documents, including the Letter of Transmittal. If you tender Existing Warrants, you may withdraw your tendered Existing Warrants before the expiration of the Offer Period and retain them on their original terms, by following the instructions herein. If the Offer Period is extended, you may withdraw your tendered Existing Warrants at any time until the expiration of such extended Offer Period. In addition, Existing Warrants that are not accepted by us for payment by March 15, 2016 may be withdrawn.

Existing Warrants which are not tendered, or which are tendered and withdrawn in accordance with the procedures herein, will retain their current terms. The Existing Warrants have exercise prices ranging from $1.00 to $3.00 per share and expire between January 6, 2016 and November 1, 2020.

During the Offer Period, holders of Existing Warrants may not transfer their Existing Warrants, other than to other holders of Existing Warrants.

This Offer is conditioned upon the existence of an effective Registration Statement on Form S-4 regarding the Common Stock issuable upon exercise of the Existing Warrants, the Replacement Warrants and the Common Stock issuable upon exercise of the Replacement Warrants and the approval for the listing of the Replacement Warrants on the NYSE MKT.

The Company’s board of directors (the “Board”) has unanimously approved this Offer. Neither the Board nor any of the Company’s officers or employees, Maxim Group LLC (“Maxim”), Network 1 Financial Securities, Inc. (“Network 1”), Broadridge Corporate Issuer Solutions, Inc. (“Broadridge”) or any other person is, however, making any recommendation as to whether you should exercise your Existing Warrants. Each holder of an Existing Warrant must make his, her or its own decision as to whether to exercise some or all of his, her or its Existing Warrant after reading this prospectus and the documents incorporated by reference herein and consulting with your advisors.

If you have any questions or need assistance, you should contact the Company, Maxim, Network 1 or Broadridge as provided in this Offer Letter/Prospectus. See “The Exchange Offer—Additional Information; Miscellaneous” beginning on page 31.

We will amend our offering materials, including this Offer Letter/Prospectus, to the extent required by applicable securities laws to disclose any material changes to information previously published, sent or given to Existing Warrant holders.

The securities offered by this Offer Letter/Prospectus involve a high degree of risk.

 

 

See “ Risk Factors ” beginning on page 10.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or determined that this prospectus is truthful or complete. A representation to the contrary is a criminal offense.

 

 

The Lead Dealer Manager for the Exchange Offer is:

Maxim Group LLC

The Co-Dealer Manager for the Exchange Offer is:

Network 1 Financial Securities, Inc.

The date of this prospectus is                     , 2016.


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ABOUT THIS PROSPECTUS

     1   

WHERE YOU CAN FIND MORE INFORMATION

     1   

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

     1   

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     3   

PROSPECTUS SUMMARY

     4   

RISK FACTORS

     10   

THE EXCHANGE OFFER

     13   

SELECTED FINANCIAL DATA

     33   

USE OF PROCEEDS

     35   

DETERMINATION OF PRICE OF EXISTING WARRANTS AND REPLACEMENT WARRANTS

     36   

DILUTION

     36   

PLAN OF DISTRIBUTION

     38   

DESCRIPTION OF SECURITIES TO BE REGISTERED

     39   

LEGAL MATTERS

     40   

EXPERTS

     40   

PART II

     II-1   

INFORMATION NOT REQUIRED IN PROSPECTUS

     II-1   

SIGNATURES

     II-4   

POWER OF ATTORNEY

     II-4   

EXHIBIT INDEX

     II-5   


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ABOUT THIS PROSPECTUS

This Offer Letter/Prospectus is not an offer or solicitation in respect to these securities in any jurisdiction in which such offer or solicitation would be unlawful. This Offer Letter/Prospectus is part of a Registration Statement on Form S-4 that we filed with the SEC. The Registration Statement that contains this Offer Letter/Prospectus (including the exhibits to the Registration Statement) contains additional information about the Company and the securities offered pursuant to this Offer Letter/Prospectus. That Registration Statement can be read at the SEC’s website or at the SEC’s offices. See “Where You Can Find More Information.”

You should rely only on the information provided in this Offer Letter/Prospectus, including the documents incorporated by reference herein, the documents filed as exhibits to the registration statement that contains this Offer Letter/Prospectus, or any supplement or amendment to this Offer Letter/Prospectus. We have not authorized anyone else to provide you with different information or additional information. You should not assume that the information in this Offer Letter/Prospectus, including the documents incorporated by reference herein, the documents filed as exhibits to the registration statement that contains this Offer Letter/Prospectus, or any supplement or amendment to this Offer Letter/Prospectus, is accurate at any date other than the date indicated on the cover page of such documents. We will amend our offering materials, including this Offer Letter/Prospectus, to the extent required by applicable securities laws to disclose any material changes to information previously published, sent or given to holders of the Existing Warrants.

WHERE YOU CAN FIND MORE INFORMATION

Before you decide whether to invest in the Replacement Warrants and Common Stock, you should read this prospectus and the information we otherwise file with the SEC. We file reports, proxy statements and other information with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). You may read and copy this information from the Public Reference Room of the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549, at prescribed rates. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website that contains reports, proxy statements and other information about issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

This Offer Letter/Prospectus “incorporates by reference” information that we have filed with the SEC pursuant to the Exchange Act, which means that we are disclosing important information to you by referring you to those documents. Any statement contained in this Offer Letter/Prospectus or in any document incorporated or deemed to be incorporated by reference into this Offer Letter/Prospectus will be deemed modified or superseded for the purposes of this Offer Letter/Prospectus to the extent that a statement contained in this Offer Letter/Prospectus or any subsequently filed document which also is, or is deemed to be, incorporated by reference into this Offer Letter/Prospectus modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this Offer Letter/Prospectus. Accordingly, we incorporate by reference the specific documents listed below and any future filings made with the SEC after the date hereof pursuant to Section 13(a), 13(c), 14, or 15(d) of the Exchange Act which will be deemed to be incorporated by reference into this Offer Letter/Prospectus and to be part of this Offer Letter/Prospectus from the date we subsequently file such reports and documents after the date hereof and prior to the effectiveness of the registration statement of which this Offer Letter/Prospectus forms a part :

 

    our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on March 12, 2015 (including the information specifically incorporated by reference therein from our definitive proxy statement on Schedule 14A, filed with the SEC on April 30, 2015);

 

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    our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2015, filed with the SEC on May 7, 2015;

 

    our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2015, filed with the SEC on August 6, 2015;

 

    our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2015, filed with the SEC on November 5, 2015;

 

    our Current Reports on Form 8-K, filed with the SEC on January 2, 2015, June 19, 2015, June 22, 2015, June 24, 2015 and October 2, 2015; and

 

    the description of our Common Stock contained in our Registration Statement on Form 8-A filed with the SEC on April 30, 2014, including any subsequent amendment or any report filed for the purpose of updating such description.

Notwithstanding the foregoing, we are not incorporating by reference information furnished under Items 2.02 and 7.01 of any Current Report on Form 8-K (including any Form 8-K itemized above), including the related exhibits, nor in any document or information deemed to have been “furnished” and not “filed” in accordance with SEC rules.

This Offer Letter/Prospectus incorporates important business and financial information about us from documents that are not included in or delivered with this prospectus. You may have already been sent some of the documents incorporated by reference, but you can obtain any of them through the SEC’s website at http://www.sec.gov or from us, excluding all exhibits (unless an exhibit has been specifically incorporated herein by reference), free of charge, by requesting them in writing or by telephone from us at the following address:

Provectus Biopharmaceuticals, Inc.

Attn: Peter R. Culpepper

7327 Oak Ridge Highway, Suite A

Knoxville, Tennessee 37931

(866) 594-5999

In order to obtain timely delivery of any of the documents noted above, you must request the information no later February 8, 2016.

 

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Offer Letter/Prospectus, including the documents incorporated by reference herein, and any free writing prospectus that we have authorized for use in connection with this offering contain forward-looking statements. Forward-looking statements relate to future events or our future financial performance. We generally identify forward-looking statements by terminology such as “may,” “will,” “would,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “assume,” “intend,” “seeks,” “potential,” “continue” or other similar words or the negative of these terms. These statements are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in “Risk Factors” and in our periodic filings with the SEC, incorporated by reference or included in this Offer Letter/Prospectus. Accordingly, you should not place undue reliance upon these forward-looking statements. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Also, the timing of events and circumstances and actual results could differ materially from those projected in the forward-looking statements.

We have included important factors in the cautionary statements included in this Offer Letter/Prospectus and incorporated herein by reference, including under the caption entitled “Risk Factors” that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Such risks and uncertainties relate to, among other factors:

 

    general economic or industry conditions;

 

    our ability to fund our working capital needs and clinical trials;

 

    our ability to complete the development of our prescription drug candidates, PV-10 and PH-10, on a timely basis or at all;

 

    our ability to secure all FDA and other regulatory approvals;

 

    the development of pharmaceutical products that may be superior to our drug candidates;

 

    securing and protecting our intellectual property, and enforcing breaches of our intellectual property;

 

    clinical results not anticipated by management;

 

    changes in accounting principles, policies or guidelines;

 

    financial or political instability;

 

    acts of war or terrorism; and

 

    other economic, competitive, governmental, regulatory and technical factors affecting our operations, our two prescription drug candidates and our intellectual property and other non-core technologies.

The forward-looking statements made or incorporated by reference in this Offer Letter/Prospectus relate only to events as of the date on which the statements are made. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. Except as required by law, we do not assume any intent to update any forward-looking statements after the date on which the statement is made, whether as a result of new information, future events or circumstances or otherwise.

 

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PROSPECTUS SUMMARY

This summary provides a brief overview of the key aspects of this offering. Because it is only a summary, it does not contain all of the detailed information contained elsewhere in this Offer Letter/Prospectus or in the documents included as exhibits to the registration statement that contains this Offer Letter/Prospectus. Accordingly, you are urged to carefully review this Offer Letter/Prospectus in its entirety (including all documents filed as exhibits to the registration statement that contains this Offer Letter/Prospectus, which may be obtained by following the procedures set forth herein in the section entitled “Where You Can Find More Information”).

Overview

 

The Company

Provectus Biopharmaceuticals, Inc., a Delaware corporation, is a development-stage biopharmaceutical company that is primarily engaged in developing ethical pharmaceuticals for oncology and dermatology indications.

 

Corporate Contact Information

Our principal executive offices are located at 7327 Oak Ridge Highway, Suite A, Knoxville, Tennessee 37931, and our telephone number is 1-866-597-5999.

Exchange Offer

 

Warrants that qualify for the Exchange Offer

As of December 28, 2015 we had outstanding Existing Warrants to purchase an aggregate of 59,861,601 shares of Common Stock, which were issued between January 6, 2011 and November 1, 2015 in transactions exempt from registration under the Securities Act. Each Existing Warrant has an exercise price of between $1.00 and $3.00 per share (not taking into account the discounted exercise price), and expires between January 6, 2016 and November 1, 2020. We are offering pursuant to this Offer Letter/Prospectus 59,861,601 shares of our Common Stock for issuance upon exercise of the Existing Warrants. The shares issued upon exercise of the Existing Warrants will be unrestricted and freely transferable.

 

Market Price of the Common Stock and
Existing Warrants

Our Common Stock is listed on the NYSE MKT under the symbol “PVCT”. On December 28, 2015, the last reported sale price of our Common Stock was $0.39. See “The Exchange Offer—Price Range of Common Stock” beginning on page 24. The June 2015 Warrants are listed on the NYSE MKT under the ticker symbol “PVCTWS.” On December 28, 2015, the last reported sale price for the June 2015 Warrants was $0.2594.

 

  There is no established trading market for the Existing Warrants.

 

The Exchange Offer/Terms of Replacement Warrants

The Offer is to temporarily modify the terms of the Existing Warrants so that each holder who tenders Existing Warrants during the Offer Period for early exercise will be able to do so at a discounted exercise price of $0.75 per share (Existing Warrants currently have an exercise price ranging between $1.00 and $3.00 per share). Each Existing Warrant holder who tenders Existing Warrants for early exercise during the Offer Period will receive, in addition to the shares of

 



 

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Common Stock purchased upon exercise, an equal number of Replacement Warrants. Each Replacement Warrant will have a cash exercise price of $0.85 per share and will expire on June 19, 2020, unless sooner exercised.

 

  For example, if an Existing Warrant holder tenders 1,000 Existing Warrants during the Offer Period that have an exercise price of $3.00, the Existing Warrant holder will be required to pay an exercise price of $0.75 per share, for a total of $750 (rather than $3,000), and will receive as a result of the exercise of the Existing Warrant 1,000 shares of our Common Stock plus a Replacement Warrant to purchase 1,000 shares of our Common Stock at an exercise price of $0.85. See “The Exchange Offer—General Terms—Terms of the Replacement Warrants” beginning on page 16.

 

  The Company expects the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants to be listed on the NYSE MKT under ticker symbol “PVCTWS” and “PVCT”, respectively. The listing of the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants on the NYSE MKT is dependent upon the existence of an effective registration statement regarding the Replacement Warrants and the cooperation of the NYSE MKT for the Replacement Warrants.

 

  This Offer is being made to all Existing Warrant holders except those holders who reside in states or other jurisdictions where an offer, solicitation or sale would be unlawful. The purpose of the Offer is to provide an incentive to exercise the Existing Warrants and thereby raise additional capital for the Company. See “The Exchange Offer—General Terms” and “—Background and Purpose of the Exchange Offer” beginning on pages 13 and 22, respectively.

 

Expiration Date of Exchange Offer

4:00 p.m., Eastern Time, on February 15, 2016, unless earlier withdrawn or extended by the Company. All Existing Warrants and related paperwork, as well as payment for Existing Warrants exercised for cash, must be received by the depositary by this time, as described in this Offer Letter/Prospectus.

 

  If the Offer Period is extended, the Company will make a public announcement of such extension by no later than 9:00 a.m., Eastern Time, on the next business day following the scheduled expiration date of the Offer.

 

  The Company may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, the Company will return the tendered Existing Warrants along with the cash delivered therewith. The Company will announce any intention to withdraw the offer by disseminating notice by public announcement or otherwise as permitted by applicable law.

 



 

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  See “The Exchange Offer—General Terms—Exchange Offer Period” beginning on page 16.

 

Withdrawal Rights

If you tender your Existing Warrants and change your mind, you may withdraw your tendered Existing Warrants at any time until the expiration of the Offer Period, as described in greater detail in the section entitled “The Exchange Offer—Withdrawal Rights” beginning on page 19. If the Offer Period is extended, you may withdraw your tendered Existing Warrants at any time until the expiration of such extended Offer Period. In addition, Existing Warrants that are not accepted by the Company for payment by March 15, 2016 may be withdrawn.

 

Participation by Officers, Directors and Affiliates

Certain of our directors, officers and affiliates intend to exercise their Existing Warrants in accordance with the terms of the Offer: Jan Koe, director of the Company, intends to exercise 350,000 Existing Warrants, Eric A. Wachter, PhD, Chief Technology Officer of the Company, intends to exercise 666,666 Existing Warrants and Peter R. Culpepper, Chief Financial Officer and Chief Operating Officer of the Company, intends to exercise 266,666 Existing Warrants.

 

Absence of Dissenters’ Rights

Holders of the Existing Warrants do not have any appraisal or dissenters’ rights under applicable law in connection with the Offer.

 

Tax Consequences of the Exchange Offer

For U.S. federal income tax purposes, we intend to treat an Existing Warrant holder’s participation in the Offer as a deemed material modification of the terms of the Existing Warrant which qualifies as a tax-free recapitalization exchange, followed by an exercise of the modified Existing Warrant for Common Stock and the Replacement Warrant, which would not result in the recognition of taxable income. The U.S. federal income tax consequences of participation in the Offer are, however, uncertain. Alternative characterizations are possible, and such alternative characterizations could result in taxable income being recognized currently by a holder that participates in the Offer.

 

  See “The Exchange Offer—U.S. Federal Income Tax Consequences” beginning on page 27.

 

Conditions of the Exchange Offer

The conditions of the Offer are:

 

    the existence of an effective registration statement regarding the Replacement Warrants, and the Common Stock issuable upon the exercise of Existing Warrants and Replacement Warrants;

 

    each Existing Warrant holder desiring to participate in the Offer delivering to the depositary in a timely manner a completed Letter of Transmittal, Notice of Guaranteed Delivery, along with the holder’s Existing Warrants and proper discounted cash payment (in the form of a certified bank check or by wire transfer of immediately available funds, payable to the depositary); and

 



 

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    approval for the listing of the Replacement Warrants on the NYSE MKT.

 

  We may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, we will return the tendered Existing Warrants along with the cash delivered therewith. We will announce any intention to withdraw by disseminating notice by public announcement or otherwise as permitted by applicable law.

 

  Except for the requirements of applicable federal and state securities laws, we know of no federal or state regulatory requirements to be complied with or approvals to be obtained by us in connection with the Offer. In the event that we make material changes to the Offer, we may be required to file an amendment to this Registration Statement.

 

  See “The Exchange Offer—Extension of Exchange Offer Period; Termination; Amendments; Conditions” beginning on page 26.

 

Risk Factors

There are risks associated with participating in the Offer. For a discussion of some of the risks you should consider before deciding whether to participate in the Offer, you are urged to carefully review and consider the information in the section entitled “Risk Factors” beginning on page 10.

 

How to Tender Existing Warrants

To tender your Existing Warrants, you must complete one of the actions described in this Offer Letter/Prospectus in the section entitled “The Exchange Offer—Procedure for Exercising and Tendering Existing Warrants” beginning on page 17 before the expiration of the Offer Period. You may also contact the Company or your broker for assistance.

 

Further Information

If you have any questions or need assistance, you should contact the Company, Maxim, Network 1 or Broadridge as provided in this Offer Letter/Prospectus. See “The Exchange Offer—Additional Information; Miscellaneous” beginning on page 31.

 

  We will amend our offering materials, including this Offer Letter/Prospectus, to the extent required by applicable securities laws to disclose any material changes to information previously published, sent or given to Existing Warrant holders.

 

Co-Dealer Managers

The co-dealer managers for the Offer are Maxim and Network 1.

 

Dealer Manager Fees and Expenses

The Company will (i) pay to Maxim a dealer manager fee consisting of a cash payment equal to four percent (4.0%) of the total proceeds received from the exchange of the Existing Warrants participating in the Offer; (ii) pay Maxim an investment banking advisory fee consisting of a cash payment equal to two percent (2.0%) of the total proceeds received by the Company in the Offer; (iii) pay Maxim

 



 

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$25,000 as an advance to be applied toward Maxim’s anticipated out-of-pocket expenses; and (iv) issue to Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to six percent (6.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised in connection with the Offer, other than Existing Warrants exercised pursuant to the Offer by clients of Network 1, as discussed below. Maxim will pay to Network 1 a cash fee equal to 100% of Maxim’s dealer manager fee for any Existing Warrants that are tendered by clients of Network 1 in the Offer.

 

  In connection with the exercise of any Existing Warrants pursuant to the Offer held by clients of Network 1, the Company will (i) issue Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer; and (ii) issue Network 1 warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer.

 

Depositary

The depositary for the Offer is Broadridge.

Securities Issuable in Exchange Offer

The Company is offering 59,861,601 shares of Common Stock for issuance upon exercise of the Existing Warrants during or after the Offer Period. The Existing Warrants will have an exercise price of $0.75 per share (after taking into account the discounted exercise price), subject to adjustment pursuant to the terms of the Existing Warrants.

The Company is offering 59,861,601 shares of Common Stock, which are issuable upon exercise of the Replacement Warrants during or after the Offer Period. The Replacement Warrants have an exercise price of $0.85 per share, subject to adjustment pursuant to the terms of the Replacement Warrants, and will expire on June 19, 2020, unless sooner exercised.

Set forth below is information regarding outstanding Common Stock and Common Stock to be issued in connection with the Exchange Offer.

 

Common Stock outstanding before the exercise of Existing Warrants and Replacement Warrants (1)

   204,979,100 shares

Common Stock issuable under the Existing Warrants

   59,861,601 shares

Common Stock issuable under the Replacement Warrants (2)

   59,861,601 shares

Common Stock outstanding after the exercise of Existing Warrants and Replacement Warrants (3)

   324,702,302 shares

 

(1) The calculation is based on the number of shares of Common Stock outstanding as of December 28, 2015, not including 59,861,601 shares of Common Stock issuable upon exercise of the Existing Warrants and approximately 30,889,994 shares of Common Stock issuable upon exercise of various other warrants and options to purchase Common Stock not subject to the Exchange Offer.

 



 

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(2) Assumes all outstanding Existing Warrants are tendered in the Offer.
(3) In order to show the effect of the Exchange Offer on the number of shares of Common Stock outstanding, the exercise of all Existing Warrants during the Offer Period and the exercise of all Replacement Warrants is assumed. The calculation is based on the number of shares of Common Stock outstanding as of December 28, 2015, not including approximately 30,889,994 shares of Common Stock issuable upon exercise of various other warrants and options to purchase Common Stock not subject to the Exchange Offer.

 



 

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RISK FACTORS

An investment in the Replacement Warrants and the Common Stock involves a high degree of risk. You should carefully consider the risks described below and the risk factors incorporated by reference herein, as well as the other information included or incorporated by reference in this Offer Letter/Prospectus, including the financial statements and related notes incorporated by reference into this Offer Letter/Prospectus, before deciding to exchange your Existing Warrants for Replacement Warrants pursuant to this Offer. Certain risks related to us and our business are contained in our Annual, Quarterly or Current Reports that we file with the SEC and that are incorporated by reference in this Offer Letter/Prospectus. See the section titled “Where You Can Find More Information” for information about how to obtain a copy of these documents. If any of these risks actually occur, our business, financial condition, operating results, or cash flow could be materially and adversely affected. Additional risks or uncertainties not presently known to us, or that we currently deem immaterial, also may impair our business operations. We cannot assure you that any of these events will not occur and if such events do occur, the value of our Common Stock and the Replacement Warrants could decline substantially .

Risks Related to Our Business

For a discussion of the risks and uncertainties related to our business, please read “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 12, 2015, which is incorporated by reference into this Offer Letter/Prospectus.

Risks Related to the Exchange Offer

There is no assurance that the Replacement Warrants will be listed on the NYSE MKT, and they may be illiquid and difficult to sell.

The June 2015 Warrants are currently listed on the NYSE MKT. We have applied for the Replacement Warrants to be listed on the NYSE MKT. We will need to satisfy certain qualitative and quantitative requirements for the Replacement Warrants to be listed on the NYSE MKT. We cannot assure you that we will be able to meet these additional listing requirements or that our application will be approved by the NYSE MKT. Therefore, there is no assurance that the Replacement Warrants will be listed on the NYSE MKT. If the Replacement Warrants are not listed on the NYSE MKT, we will not be able to consummate the Offer and issue the Replacement Warrants.

In addition, it is likely that there will be relatively small trading volume in the Replacement Warrants, even if they are listed, and this will likely make it difficult for our warrant holders to sell their Replacement Warrants as, and when, they choose. As a result, investors may not always be able to resell such Replacement Warrants publicly at the times and prices that they feel are fair or appropriate.

If you participate in the Exchange Offer and exercise your Existing Warrants, you are paying an exercise price at a premium over the market price of the Common Stock and could only sell the Common Stock you acquire upon exercise of your Existing Warrants at a loss.

As of December 28, 2015, the market price of our Common Stock was $0.39. If you participate in the Exchange Offer and exercise your Existing Warrants, you will pay $0.75 for each share of Common Stock you receive upon exercise of your Existing Warrant (after taking into account the discounted exercise price), which is $0.36 more than the market price of our Common Stock on December 28, 2015. As a result, you will only be able to sell the shares of Common Stock you acquire through participation in the Exchange Offer at a loss unless and until the market price of our Common Stock exceeds such exercise price.

The exercise prices of the Existing Warrants and the Replacement Warrants have been arbitrarily determined.

The exercise prices of the Existing Warrants were and the Replacement Warrants have been arbitrarily determined. The exercise price of the Existing Warrants was originally determined by our Board at the time of

 

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each issuance of such Existing Warrants. Our Board established the exercise price for the Replacement Warrants based on its estimation of those terms that would encourage holders of Existing Warrants to participate in the Offer. The exercise prices of the Existing Warrants and the Replacement Warrants bear no relationship to our assets, book value, lack of earnings, net worth or other recognized criteria of value, including our quoted Common Stock and warrant prices.

Because we will have broad discretion over the use of the net proceeds from the exercise of the Existing Warrants, you may not agree with how we use the proceeds.

We will have broad discretion with respect to the use of the proceeds for the exercise of the Existing Warrants. While we currently anticipate that we will use the net proceeds for clinical development, working capital and general corporate purposes. We cannot estimate precisely the allocation of the net proceeds from this offering. The amounts and timing of the expenditures may vary significantly, depending on numerous factors. Some of these factors include the amount of cash used in our operations, progress of our clinical trials, and other development efforts, including immunology work for both our oncology and dermatology programs to determine the unique immuno-chemoablative and anti-inflammatory characteristics of our respective drug product candidates. Accordingly, our management will have broad discretion in the application of the net proceeds from the exercise of the Existing Warrants. Until we use the net proceeds from the exercise of the tendered Existing Warrants, we intend to invest the funds in short-term, investment grade, interest-bearing securities and short-term U.S. Treasury bills.

If you elect to tender Existing Warrants and purchase Common Stock in this offering, you will experience immediate dilution.

If you elect to tender Existing Warrants in response to the Offer and purchase our Common Stock, you will experience immediate dilution, which would have been $0.51 per share as of September 30, 2015, because the price that you pay for our Common Stock will be greater than the net tangible book value per share of our Common Stock. See “Dilution” on page 36 for more information.

The issuance and sale of Common Stock upon exercise of the Existing Warrants and Replacement Warrants may depress the market price of our Common Stock.

If all 59,861,601 Existing Warrants are exercised pursuant to this Exchange Offer, the price of our Common Stock may decline. In addition, the Common Stock issuable upon exercise of the Existing Warrants and Replacement Warrants may represent overhang that may also adversely affect the market price of our Common Stock. Overhang occurs when there is a greater supply of a company’s stock in the market than there is demand for that stock. When this happens the price of the company’s stock will decrease, and any additional shares which stockholders attempt to sell in the market will only further decrease the share price. If the share volume of our Common Stock cannot absorb shares sold by the Existing Warrant and Replacement Warrant holders, then the value of our Common Stock will likely decrease.

In the event you elect not to exchange your Existing Warrants for Replacement Warrants, your Existing Warrants will have no trading market and will remain illiquid.

The Company plans to list the Replacement Warrants on NYSE MKT, but will not list the Existing Warrants. Accordingly, if you retain your Existing Warrant, there is no trading market for such Existing Warrant and it will remain subject to resale restrictions under federal securities laws. This will make the Existing Warrants more difficult to sell.

There must be a current prospectus in effect in order for you to exercise the Existing Warrants and the Replacement Warrants.

Investors will be able to exercise the Existing Warrants and the Replacement Warrants only if a current prospectus relating to the Common Stock underlying such Existing Warrants and Replacement Warrants is then

 

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in effect and only if such securities are qualified for sale or exempt from qualification under the applicable securities laws of the states in which the various holders of warrants reside. Although we will use our best efforts to maintain the effectiveness of a current prospectus covering the Common Stock underlying the Existing Warrants and the Replacement Warrants, there can be no assurance that we will be able to do so. We will be unable to issue Common Stock to those persons desiring to exercise their Existing Warrants or Replacement Warrants if a current prospectus covering the Common Stock issuable upon the exercise of the warrants is not kept effective or if such Common Stock is not qualified nor exempt from qualification in the states in which the holders of the warrants reside.

 

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THE EXCHANGE OFFER

Participation in the Offer involves a number of risks, including, but not limited to, the risks identified in the section entitled “Risk Factors.” Existing Warrant holders should carefully consider these risks and are urged to speak with their personal financial, investment and/or tax advisor as necessary before deciding whether or not to participate in this Offer. In addition, we strongly encourage you to read this Offer Letter/Prospectus in its entirety and the publicly-filed information about the Company referenced herein, before making a decision regarding the Offer.

 

This Exchange Offer will expire at on February 15, 2016 at 4:00 p.m. Eastern (such date and time may be extended in accordance with applicable law). You may withdraw your Existing Warrants that you tendered in the Exchange Offer on or prior to this date.

General Terms

For a limited period of time, the Company is offering to certain of its holders of Existing Warrants the opportunity to receive Replacement Warrants upon the exercise of their Existing Warrants. The Offer is to temporarily modify the terms of such Existing Warrants so that each holder who tenders Existing Warrants during the Offer Period for early exercise will be able to do so for the discounted exercise price of $0.75 per share (Existing Warrants currently have exercise prices ranging between $1.00 and $3.00 per share).

The terms of each of the Existing Warrants are substantially identical to each other except for the exercise prices and the expiration dates of the Existing Warrants. A summary of the terms of the Existing Warrants is provided below:

 

Title of Security

   Warrant Shares      Date    Date    Price  

Warrant to Purchase Common Stock

     200,000       1/3/2011    1/6/2016    $ 1.75   

Warrant to Purchase Common Stock

     100,000       3/11/2011    3/11/2016    $ 2.00   

Warrant to Purchase Common Stock

     100,000       3/11/2011    3/11/2016    $ 2.00   

Warrant to Purchase Common Stock

     110,000       3/17/2011    3/16/2016    $ 1.12   

Warrant to Purchase Common Stock

     1,483,545       4/15/11    4/15/2016    $ 1.25   

Warrant to Purchase Common Stock

     211,607       4/15/11    4/15/2016    $ 1.25   

Warrant to Purchase Common Stock

     638,368       4/15/11    4/15/2016    $ 1.25   

Warrant to Purchase Common Stock

     200,000       11/4/2011    11/4/2016    $ 1.50   

Warrant to Purchase Common Stock

     200,000       11/4/2011    11/4/2016    $ 1.50   

Warrant to Purchase Common Stock

     371,035       6/15/12    6/15/2017    $ 1.12   

Warrant to Purchase Common Stock

     100,000       6/28/2012    4/15/2016    $ 1.25   

Warrant to Purchase Common Stock

     2,841,236       10/31/12    10/31/2017    $ 1.00   

Warrant to Purchase Common Stock

     317,249       10/31/12    10/31/2017    $ 1.00   

Warrant to Purchase Common Stock

     268,333       12/1/12    12/1/2017    $ 1.00   

Warrant to Purchase Common Stock

     100,000       12/11/2012    12/31/2017    $ 1.12   

Warrant to Purchase Common Stock

     100,000       12/11/2012    12/31/2017    $ 1.12   

Warrant to Purchase Common Stock

     252,500       12/31/2012    12/31/2015    $ 1.12   

Warrant to Purchase Common Stock

     1,648,613       1/31/13    1/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     349,418       1/31/13    1/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     400,000       2/5/2013    2/5/2016    $ 1.12   

Warrant to Purchase Common Stock

     3,500       3/31/2013    3/31/2016    $ 1.12   

Warrant to Purchase Common Stock

     2,409,001       3/31/13    3/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     189,983       3/31/13    3/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     300,000       3/31/2013    3/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     62,500       4/1/2013    4/1/2016    $ 1.00   

 

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Title of Security

   Warrant Shares      Date    Date    Price  

Warrant to Purchase Common Stock

     100,000       4/1/2013    4/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     62,500       4/1/2013    4/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     25,000       4/1/2013    4/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     25,000       4/1/2013    4/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     1,330,000       04/01/13    4/1/2018    $ 1.00   

Warrant to Purchase Common Stock

     5,008,002       4/30/13    4/30/2018    $ 1.00   

Warrant to Purchase Common Stock

     352,200       4/30/13    4/30/2018    $ 1.00   

Warrant to Purchase Common Stock

     50,000       7/1/2013    7/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     3,500       7/1/2013    7/1/2016    $ 1.00   

Warrant to Purchase Common Stock

     250,000       7/1/2013    7/1/2018    $ 1.00   

Warrant to Purchase Common Stock

     1,842,251       7/31/13    7/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     124,483       7/31/13    7/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     3,450,500       8/1/13    8/1/2018    $ 1.00   

Warrant to Purchase Common Stock

     7,358,826       8/31/13    8/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     490,589       8/31/13    8/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     69,500       9/30/2013    9/30/2018    $ 1.00   

Warrant to Purchase Common Stock

     4,000       9/30/2013    9/30/2018    $ 1.00   

Warrant to Purchase Common Stock

     65,000       9/30/2013    9/30/2018    $ 1.00   

Warrant to Purchase Common Stock

     100,000       10/23/2013    10/23/2018    $ 1.00   

Warrant to Purchase Common Stock

     11,641,176       10/31/13    10/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     1,492,500       10/31/13    10/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     776,078       10/31/13    10/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     10,000       12/15/2013    12/15/2018    $ 1.00   

Warrant to Purchase Common Stock

     3,000       12/31/2013    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     96,473       12/31/2013    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     100,000       1/1/2014    12/31/2018    $ 2.00   

Warrant to Purchase Common Stock

     12,500       1/1/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     37,500       1/1/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     50,000       1/14/2014    1/1/2017    $ 1.00   

Warrant to Purchase Common Stock

     400,000       1/31/2014    1/31/2016    $ 1.00   

Warrant to Purchase Common Stock

     20,000       3/29/2014    3/28/2018    $ 2.00   

Warrant to Purchase Common Stock

     12,500       3/31/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     3,000       3/31/2014    12/31/2018    $ 2.00   

Warrant to Purchase Common Stock

     50,000       3/31/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     37,500       3/31/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     2,000,000       4/30/14    4/30/2019    $ 3.00   

Warrant to Purchase Common Stock

     300,000       4/30/14    4/30/2019    $ 2.50   

Warrant to Purchase Common Stock

     50,000       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     12,500       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     12,500       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     37,500       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     37,500       6/30/2014    6/30/2019    $ 1.00   

Warrant to Purchase Common Stock

     2,000       6/30/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     6,000       9/30/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     1,793,150       9/30/14    9/30/2019    $ 1.25   

Warrant to Purchase Common Stock

     358,630       9/30/14    9/30/2019    $ 1.25   

Warrant to Purchase Common Stock

     400,000       10/1/2014    12/31/2018    $ 1.00   

Warrant to Purchase Common Stock

     50,000       10/1/2014    10/1/2019    $ 1.00   

Warrant to Purchase Common Stock

     250,000       10/1/2014    10/1/2018    $ 1.00   

Warrant to Purchase Common Stock

     12,500       10/1/2014    10/1/2019    $ 1.00   

 

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Title of Security

   Warrant Shares      Date    Date    Price  

Warrant to Purchase Common Stock

     50,000       10/1/2014    10/1/2018    $ 1.00   

Warrant to Purchase Common Stock

     37,500       10/1/2014    10/1/2019    $ 1.00   

Warrant to Purchase Common Stock

     300,000       10/28/14    10/28/2019    $ 1.00   

Warrant to Purchase Common Stock

     2,099,150       11/15/14    11/15/2019    $ 1.25   

Warrant to Purchase Common Stock

     419,830       11/15/14    11/15/2019    $ 1.25   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     12,500       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     37,500       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     3,913       12/31/2014    12/31/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       12/15/2014    12/15/2019    $ 1.00   

Warrant to Purchase Common Stock

     3,000       3/31/2015    12/31/2019    $ 1.00   

Warrant to Purchase Common Stock

     388,000       3/31/15    3/31/2020    $ 1.25   

Warrant to Purchase Common Stock

     77,600       3/31/15    3/31/2020    $ 1.25   

Warrant to Purchase Common Stock

     100,000       4/1/2015    12/31/2019    $ 1.00   

Warrant to Purchase Common Stock

     505,550       4/30/15    4/30/2020    $ 1.25   

Warrant to Purchase Common Stock

     101,110       4/30/15    4/30/2020    $ 1.25   

Warrant to Purchase Common Stock

     4,500       7/1/2015    12/31/2019    $ 1.00   

Warrant to Purchase Common Stock

     50,000       8/1/2015    8/1/2020    $ 1.00   

Warrant to Purchase Common Stock

     25,000       8/1/2015    8/1/2020    $ 1.00   

Warrant to Purchase Common Stock

     3,000       10/1/2015    12/31/2019    $ 1.00   

Warrant to Purchase Common Stock

     618,867       11/1/2015    11/1/2020    $ 1.00   

Warrant to Purchase Common Stock

     25,168       11/1/2015    11/1/2020    $ 1.00   

Warrant to Purchase Common Stock

     866,667       11/1/2015    11/1/2020    $ 1.00   

During the Offer Period, each Existing Warrant holder who tenders Existing Warrants for early exercise will receive, in addition to the shares of Common Stock purchased upon exercise, Replacement Warrants expiring June 19, 2020 to purchase an equal number of shares of our Common Stock at an exercise price of $0.85 per share. For example, if an Existing Warrant holder tenders 1,000 Existing Warrants during the Offer Period that have an exercise price of $3.00, the Existing Warrant holder will be required to pay an exercise price of $0.75 per share (after taking into account the discounted exercise price), for a total of $750 (rather than $3,000), and will receive as a result of the exercise of the Existing Warrant 1,000 shares of our Common Stock plus a Replacement Warrant to purchase 1,000 shares of our Common Stock.

The Offer is subject to the terms and conditions contained in this Offer Letter/Prospectus and the Letter of Transmittal. You may tender some or all of your Existing Warrants on these terms.

If you elect to tender Existing Warrants in response to this Offer, please follow the instructions in this Offer Letter/Prospectus and the related documents, including the Letter of Transmittal.

If you tender Existing Warrants, you may withdraw your tendered Existing Warrants before the expiration of the Offer Period and retain them on their original terms, by following the instructions herein. If the Offer Period is extended, you may withdraw your tendered Existing Warrants at any time until the expiration of such extended Offer Period. In addition, Existing Warrants that are not accepted by us for payment by March 15, 2016 may be withdrawn.

 

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Terms of the Replacement Warrants

During the Offer Period, each Existing Warrant holder who tenders Existing Warrants for early exercise will receive, in addition to the shares of Common Stock purchased upon exercise, Replacement Warrants expiring June 19, 2020 to purchase an equal number of shares of our Common Stock at an exercise price of $0.85 per share. The terms of the Replacement Warrants will be the same as the terms of June 2015 Warrants. For additional details regarding the terms of the Replacement Warrants, see “Description of Securities to be Registered—Replacement Warrants” beginning on page 39.

The Company expects the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants to be listed on the NYSE MKT under the ticker symbol “PVCTWS” and “PVCT,” respectively. The listing of the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants on the NYSE MKT is dependent upon the existence of an effective registration statement regarding the Replacement Warrants and the cooperation of NYSE MKT for the Replacement Warrants and the Common Stock issuable upon the exercise of the Replacement Warrants.

Exchange Offer Period

The Offer will be open until February 15, 2016 at 4:00 p.m., Eastern Time, unless earlier withdrawn or extended by the Company. We expressly reserve the right, in our sole discretion, at any time or from time to time, to extend the period of time during which the Offer is open. There can be no assurance that we will exercise our right to extend the Offer Period. During any extension, all Existing Warrant holders who previously tendered Existing Warrants will have a right to withdraw such previously tendered Existing Warrants until the expiration of the Offer Period, as extended. We will pay no interest on cash tendered for the exercise price of the Existing Warrants regardless of any extension of, or amendment to, the Offer. If we extend the Offer Period, we will make a public announcement of such extension by no later than 9:00 a.m., Eastern Time, on the next business day following the scheduled expiration of the Offer.

We may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, we will return the tendered Existing Warrants along with the cash delivered therewith. We will announce any intention to withdrawal by disseminating notice by public announcement or otherwise as permitted by applicable law.

At the expiration of the Offer Period, the original terms of any untendered Existing Warrants shall resume and continue to apply until the Existing Warrants expire by their terms of their respective expiration dates.

Partial Exercise Permitted

If you choose to participate in the Offer, you may exercise less than all of your Existing Warrants pursuant to the terms of the Offer.

EXISTING WARRANTS NOT EXERCISED DURING THE OFFER PERIOD SHALL, AFTER THE EXPIRATION OF THE OFFER PERIOD, BE EXERCISABLE IN ACCORDANCE WITH THE GENERAL TERMS OF SUCH EXISTING WARRANTS, AS THE TERMS OF SUCH EXISTING WARRANTS EXISTED PRIOR TO THE COMMENCEMENT OF THIS OFFER. UNEXERCISED EXISTING WARRANTS SHALL EXPIRE IN ACCORDANCE WITH THEIR TERMS BETWEEN JANUARY 6, 2016 AND NOVEMBER 1, 2020, UNLESS, IN EACH CASE, SOONER EXERCISED AS PERMITTED BY THEIR RESPECTIVE TERMS.

Conditions to the Exchange Offer

The Offer is conditioned upon the existence of an effective registration statement on Form S-4 regarding the Replacement Warrants, and the Common Stock issuable upon the exercise of the shares of Common Stock

 

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issuable upon the exercise of the Existing Warrants and of the Replacement Warrants. In order to register the Replacement Warrants to be issued upon the exercise of the Existing Warrants in this Offer, we have filed with the SEC this Registration Statement.

We will not complete the Offer unless and until the registration statement on Form S-4 is declared effective by the SEC. If there is a delay in such effectiveness, we may, in our discretion, extend, suspend or cancel the Offer, and will inform Existing Warrant holders of such event. If we extend the Offer Period, we will make a public announcement of such extension by no later than 9:00 a.m., Eastern Time, on the next business day following the scheduled expiration of the Offer.

The Offer is also conditioned upon each Existing Warrant holder desiring to participate in the Offer delivering to the depositary in a timely manner a completed Letter of Transmittal, along with the holder’s Existing Warrants, proper discounted cash payment (in the form of a certified bank check or by wire transfer of immediately available funds, payable to the depositary), and any other paperwork the depositary deems necessary to effect such participation.

Finally, the Offer is conditioned upon the approval for listing of the Replacement Warrants on the NYSE MKT. The June 2015 Warrants are currently listed on the NYSE MKT under the symbol “PVCTWS.” We intend to apply to list the Replacement Warrants on the NYSE MKT after the closing of the Offer. There can be no assurance, however, that our application will be approved.

We may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, we will return the tendered Existing Warrants along with the cash delivered therewith. We will announce any intention to withdrawal by disseminating notice by public announcement or otherwise as permitted by applicable law.

No Recommendation; Existing Warrant Holder’s Own Decision

The Board has unanimously approved this Offer. Neither the Board nor any of the Company’s officers or employees, Maxim, Network 1, Broadridge or any other person, however, is making any recommendation as to whether you should exercise your Existing Warrants. Each holder of an Existing Warrant must make his, her or its own decision as to whether to exercise some or all of his, her or its Existing Warrant after reading this prospectus and the documents incorporated by reference herein and consulting with your advisors.

Procedure for Exercising and Tendering Existing Warrants

Issuance of Common Stock and Replacement Warrants upon exercise of Existing Warrants pursuant to this Offer and acceptance of Existing Warrants pursuant to this Offer will be made only if Existing Warrants are exercised and tendered pursuant to the procedures described below. An exercise of Existing Warrants pursuant to the procedures below will constitute a binding agreement between the exercising holder of Existing Warrants and the Company upon the terms and subject to the conditions of the Offer.

Proper Exercise and Tender of Existing Warrants

Required Submissions

Existing Warrant holders who have received a Letter of Transmittal are considered “registered owners” of Existing Warrants and, in order to exercise and tender Existing Warrants pursuant to the Offer, must ensure that the depositary receives the following: (i) a properly completed and duly executed Letter of Transmittal or photocopy/facsimile thereof; (ii) the holder’s Existing Warrant certificate(s); (iii) any required signature guarantees; and (iv) proper discounted payment for the exercise of the tendered Existing Warrants calculated as described in “General Terms” above.

 

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The method of delivery of all required documents is at the option and risk of the tendering Existing Warrant holders. If delivery is by mail, we recommend registered mail with return receipt requested (properly insured). In all cases, sufficient time should be allowed to assure timely delivery. Existing Warrants will be deemed properly tendered during the Offer Period only if the Existing Warrants being exercised are delivered to the depositary by 4:00 p.m., Eastern Time, on February 15, 2016, at the address of the depositary set forth in the section entitled “The Offer-Depositary,” and are accompanied by proper payment and a properly completed and duly executed Letter of Transmittal or, if applicable, the guaranteed delivery procedures set forth herein are followed.

In the Letter of Transmittal, the exercising Existing Warrant holder must: (1) set forth his, her or its name and address; (2) set forth the number of Existing Warrants exercised; and (3) set forth the number of the Existing Warrant certificate(s) representing such Existing Warrants. The Common Stock and Replacement Warrants to be issued upon exercise of Existing Warrants during the Offer Period, along with a certificate representing the balance of any unexercised Existing Warrants, will be delivered as set forth in the section of this Offer Letter/Prospectus entitled “The Exchange Offer—Acceptance for Issuance of Common Stock and Replacement Warrants” beginning on page 20.

If the Letter of Transmittal is signed by someone other than the registered owner of the Existing Warrants (for example, if the registered owner has appointed a Power of Attorney, assigned the Existing Warrants to a third-party, or is unable to execute the Letter of Transmittal), the Existing Warrants must be endorsed or accompanied by appropriate assignment documents, in either case signed exactly as the name(s) of the registered owner(s) appear on the Existing Warrants, with the signature(s) on the Existing Warrants or assignment documents guaranteed.

None of the Existing Warrants are eligible to be held through a direct or indirect Depository Trust Company (“DTC”) participant, such as a broker, dealer, commercial bank, trust company or other financial intermediary. Therefore, Broadridge has not established an account for the Existing Warrants at the DTC for purposes of the Offer and book-entry delivery of the Existing Warrants is not available.

ALL DELIVERIES IN CONNECTION WITH THE OFFER, INCLUDING THE LETTER OF TRANSMITTAL, EXISTING WARRANTS AND PROPER DISCOUNTED PAYMENT FOR THE EARLY EXERCISE OF THE TENDERED EXISTING WARRANTS, MUST BE MADE TO THE DEPOSITARY. NO DELIVERIES SHOULD BE MADE TO THE COMPANY, AND ANY DOCUMENTS DELIVERED TO THE COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT BE DEEMED TO BE PROPERLY TENDERED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY TO THE DEPOSITARY.

Signature Guarantees

In certain cases, all signatures on the Letter of Transmittal must be guaranteed by an “Eligible Institution.” An “Eligible Institution” is a bank, broker dealer, credit union, savings association or other entity that is a member in good standing of the Securities Transfer Agents Medallion Program or a bank, broker, dealer, credit union, savings association or other entity which is an “eligible guarantor institution,” as that term is defined in Rule 17Ad-15 promulgated under the Exchange Act.

Signatures on the Letter of Transmittal need not be guaranteed if (1) the Letter of Transmittal is signed by the registered owner of the Existing Warrants tendered therewith and such holder has not completed the box entitled “Special Delivery Instructions” or “Special Issuance Instructions” in the Letter of Transmittal; or (2) such Existing Warrants are tendered for the account of an Eligible Institution.

Where Existing Warrants are exercised by a registered owner of the Existing Warrants who has completed either the box entitled “Special Payment Instructions” or the box entitled “Special Delivery Instructions” on the Letter of Transmittal, all signatures on the Letter of Transmittal must be guaranteed by an Eligible Institution. Additionally, where the Letter of Transmittal is signed by someone other than the registered owner of the Existing Warrants, all signatures on the Letter of Transmittal must be guaranteed by an Eligible Institution.

 

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Guaranteed Delivery Procedures

If a holder of Existing Warrants wants to exercise his, her or its Existing Warrants pursuant to the Offer, but (1) the Existing Warrant certificates are not immediately available, or (2) time will not permit all required documents to reach the depositary prior to the expiration of the Offer Period, Existing Warrant holders can still exercise their Existing Warrants if all the following conditions are met:

1. the tender is made by or through an “Eligible Institution”;

2. the depositary receives by hand, mail, overnight courier or facsimile transmission, prior to the expiration of the Offer Period, a properly completed and duly executed Notice of Guaranteed Delivery in the form the Company has provided with this document, with signatures guaranteed by an Eligible Institution, accompanied by proper discounted payment for the early exercise of the tendered Existing Warrants; and

3. the depositary receives, within three business days after the date of its receipt of the Notice of Guaranteed Delivery: (i) the certificates for all tendered Existing Warrants, (ii) a properly completed and duly executed Letter of Transmittal or photocopy/facsimile thereof, and (iii) any other required documents.

In any event, the issuance of shares of Common Stock and Replacement Warrants for Existing Warrants exercised pursuant to the Exchange Offer and accepted pursuant to the Exchange Offer will be made only if the depositary has timely received the applicable foregoing items.

Determination of Validity

All questions as to the form of documents and the validity, eligibility (including time of receipt) and acceptance for payment of any tender of Existing Warrants will be determined by us, in our sole discretion, and our determination shall be final and binding, subject to the judgment of any court with jurisdiction over us. We reserve the absolute right, subject to the judgment of any court, to reject any or all tenders of Existing Warrants that we determine are not in proper form or reject Existing Warrants that may, in the opinion of our counsel, be unlawful. We also reserve the absolute right, subject to the judgment of any court with jurisdiction over us, to waive any defect or irregularity in any tender of the Existing Warrants. Neither we nor any other person will be under any duty to give notice of any defect or irregularity in tenders, nor shall any of them incur any liability for failure to give any such notice.

The exercise of Existing Warrants pursuant to the procedure described above will constitute a binding agreement between the tendering Existing Warrant holder and the Company upon the terms and subject to the conditions of the Offer.

Withdrawal Rights

Tenders of Existing Warrants made pursuant to the Offer may be withdrawn at any time prior to the expiration of the Offer Period. If the Offer Period is extended, you may withdraw your tendered Existing Warrants at any time until the expiration of such extended Offer Period. After the Offer Period expires, such tenders are irrevocable, provided, however, that Existing Warrants that are not accepted by us for payment by March 15, 2016 may be withdrawn. We will pay no interest on the exercise price of the Existing Warrants regardless of any withdrawal of tendered warrants during the Offer Period, or any extension of, or amendment to, the Offer.

To be effective, a written notice of withdrawal must be timely received by the depositary at its address identified in this Offer Letter/Prospectus. Any notice of withdrawal must specify the name of the person who tendered the Existing Warrants for which tenders are to be withdrawn and the number of Existing Warrants to be withdrawn. If the Existing Warrants to be withdrawn have been delivered to the depositary, a signed notice of withdrawal must be submitted prior to release of such Existing Warrants. In addition, such notice must specify

 

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the name of the registered owner (if different from that of the tendering Existing Warrant holder) and the serial numbers shown on the particular certificates evidencing the Existing Warrants to be withdrawn. Withdrawal may not be cancelled, and Existing Warrants for which tenders are withdrawn will thereafter be deemed not validly tendered for purposes of the Offer. However, Existing Warrants for which tenders are withdrawn may be tendered again by following one of the procedures described above in the section entitled “The Offer-Procedure for Exercising and Tendering Existing Warrants” at any time prior to the expiration of the Offer Period.

All questions as to the form and validity (including time of receipt) of any notice of withdrawal will be determined by us, in our sole discretion, which determination shall be final and binding, subject to the judgments of any courts with jurisdiction over us that might provide otherwise. Neither we nor any other person will be under any duty to give notification of any defect or irregularity in any notice of withdrawal or incur any liability for failure to give any such notification, subject to the judgment of any court with jurisdiction over us.

Acceptance for Issuance of Common Stock and Replacement Warrants

Upon the terms and subject to the conditions of the Offer, we will accept for exercise Existing Warrants validly tendered until 4:00 p.m., Eastern Time, on February 15, 2016, unless earlier withdrawn or further extended by the Company. The Common Stock and Replacement Warrants to be issued upon exercise of Existing Warrants during the Offer Period, along with a certificate representing the balance of any unexercised Existing Warrants, will be delivered promptly following the expiration of the Offer Period (the “Closing Date”). In all cases, Existing Warrants will only be accepted for exercise pursuant to the Offer after timely receipt by the depositary of (i) certificates for Existing Warrants tendered either physically, (ii) a properly completed and duly executed Letter of Transmittal or manually signed photocopy/facsimile thereof, (iii) a certified bank check or wire transfer of immediately available funds in accordance with the instructions herein, in the amount for the discounted exercise price for the Common Stock being acquired upon exercise of the Existing Warrants tendered, payable to “Broadridge Corporate Issuer Solutions, Inc.”, as warrant agent and depositary, and (iv) any required signature guarantees, if applicable.

For purposes of the Offer, we will be deemed to have accepted for exercise Existing Warrants that are validly tendered and for which tenders are not withdrawn, unless we give written notice to the Existing Warrant holder of our non-acceptance.

Overview

We are a development-stage biopharmaceutical company that is primarily engaged in developing ethical pharmaceuticals for oncology and dermatology indications. Our goal is to develop alternative treatments that are safer, more effective, less invasive and more economical than conventional therapies. We develop and intend to license or market and sell our two prescription drug candidates, PV-10 and PH-10. We also hold patents and other intellectual property which we believe may be used in over-the-counter products, which we refer to as OTC products, and various other non-core technologies. We have transferred all our intellectual property related to OTC products and non-core technologies to our subsidiaries and have designated such subsidiaries as non-core to our primary business of developing our oncology and dermatology prescription drug candidates.

We focus on developing our prescription drug candidates PV-10 and PH-10. We are developing PV-10 for treatment of several life threatening cancers including metastatic melanoma, liver cancer, and breast cancer. We are developing PH-10 to provide minimally invasive treatment of chronic severe skin afflictions such as psoriasis and atopic dermatitis, a type of eczema. We believe that our prescription drug candidates will be safer and more specific than currently existing products. All of our prescription drug candidates are in either the pre-clinical or clinical trial stage.

 

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The table below sets forth our two drug candidates and our progress in developing those candidates for these indications:

 

PV-10

Melanoma

 

•    Patient enrollment for Phase 3 study for treatment of locally advanced cutaneous melanoma opened in April 2015

 

•    Phase 1b/2 combination study of PV-10 + immune checkpoint blockade is being designed 2014 into 2015

 

•    Type C FDA Meeting December 2013

 

•    Finalized Phase 2 data October 2012 and September 2013

 

•    End-of-Phase 2 FDA meeting April 2010, March 2011, and October 2011

 

•    Phase 2 study completed May 2010

 

•    Phase 2 treatments completed September 2009

 

•    Phase 2 recruitment completed May 2009

 

•    Phase 2 study initiated September 2007

 

•    Orphan drug status January 2007

PH-10

Psoriasis

 

•    Full Phase 2c study report submitted to FDA February 2014

 

•    Toxicity study research and development for advanced studies 2012, 2013 and into 2014

 

•    Phase 2c randomized study final data collection February 2012

 

•    Phase 2c randomized study initiated December 2010 and completed August 2011

 

•    Phase 2 study completed April 2010

 

•    Phase 2 recruitment completed October 2009

 

•    Replacement Phase 2 initiated July 2009 due to dose regimen change

 

•    Phase 2 study initiated November 2007

PH-10

Atopic Dermatitis

 

•    Toxicity study research and development for advanced studies 2012, 2013, 2014 and 2015

 

•    Phase 2 study completed September 2009

 

•    Phase 2 recruitment completed June 2009

 

•    Phase 2 study initiated June 2008

PV-10

Breast Cancer

 

•    Assessing further development in 2013, 2014 and 2015 in conjunction with Moffitt Cancer Center research

 

•    Phase 1 study completed July 2008

 

•    Phase 1 initial cohort treatment completed April 2006

 

•    Phase 1 study initiated October 2005

PV-10

Liver Metastasis

 

•    Expanded Phase 1 trial, currently in progress, is expected to continue in 2016

 

•    Phase 1 protocol expansion September 2012 through 2014 into 2015

 

•    Orphan drug status April 2011

 

•    Phase 1 patient accrual and treatment completed January 2011

 

•    Phase 1 study initiated October 2009

 

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PV-10

Mechanism of Action

 

•    Moffitt Cancer Center initiates Phase 1 feasibility study to detect immune cell infiltration into melanomas treated by PV-10 in January 2013 into 2014 and 2015

 

•    Phase 1 trial is currently in progress and enrollment has been completed

PH-10

Mechanism of Action

 

•    Phase 2 study initiated January 2015

In addition to clinical trials, patients enrolled in the expanded access or compassionate use program for PV-10 are also receiving PV-10 treatments for cutaneous and subcutaneous cancer indications.

Corporate Information

On April 23, 2002, Provectus Pharmaceutical, Inc., a Nevada corporation and a merger “blank check” public company, acquired Provectus Pharmaceuticals, Inc., a privately-held Tennessee corporation (“PPI”), by issuing 6,680,000 shares of Common Stock of Provectus Pharmaceutical to the stockholders of PPI in exchange for all of the issued and outstanding shares of PPI, as a result of which Provectus Pharmaceutical changed its name to Provectus Pharmaceuticals, Inc. and PPI became a wholly-owned subsidiary of us. On December 16, 2013, Provectus Pharmaceuticals, Inc. was reincorporated in Delaware and changed its name to Provectus Biopharmaceuticals, Inc. Our principal executive offices are located at 7327 Oak Ridge Highway, Suite A, Knoxville, Tennessee 37931, and our telephone number is 1-866-597-5999. Our website address is www.pvct.com. The information on, or accessible through, our website is not part of, and is not incorporated into, this prospectus or any prospectus supplement and should not be considered part of this prospectus or any prospectus supplement.

Background and Purpose of the Exchange Offer

Background

Since 2011, the Company has issued the Existing Warrants in transactions exempt from the registration requirements of the Securities Act. After the issuance of the June 2015 Warrants in the Company’s June 2015 public offering, the Company became interested in having the Existing Warrants listed on the NYSE MKT and simplifying its capitalization structure by consolidating its classes of outstanding warrants.

The Company completed the June 2015 Offering of Common Stock and June 2015 Warrants on June 24, 2015, underwritten by Maxim. Following the June 2015 Offering, the Company believed there was investor interest in purchasing the June 2015 Warrants.

In July, August and September 2015, the Company held a series of discussions with its advisors, including Maxim, regarding the idea of exchanging some or all of its outstanding warrants issued in one or more private placements for June 2015 Warrants. As a result of these discussions, the Company determined that it would be desirable to have these warrant holders exchange their warrants for warrants that were the same class as the June 2015 Warrants and cash in order to simplify its warrant structure and raise capital.

In October 2015, the Company and its advisors evaluated the merits of the Offer, including the potential for listing the new warrants, the Replacement Warrants, on the NYSE MKT.

On October 14, 2015, the Company met with Maxim and decided to formally pursue the Offer.

On December 10, 2015, the Company held a meeting of its Board where the Board discussed the Offer and its intended purposes and reasons for entering into such Offer. The Board acted by unanimous written consent to

 

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approve a Letter of Engagement between the Company and Maxim on December 14, 2105, at which time Maxim was formally engaged as the Company’s advisor and dealer manager for the Offer. On December 31, 2015, Maxim entered into an agreement with Network 1, pursuant to which Network 1 agreed to act as co-dealer manager for the Offer.

On December 30, 2015, the Board acted by unanimous written consent to approve the final terms of the Offer and to enter into the transactions contemplated thereby.

Purpose of the Exchange Offer

The purpose of the Offer is to provide an incentive to exercise the Existing Warrants and thereby raise additional capital for the Company. The Existing Warrants that are tendered for early exercise pursuant to the Offer will be retired. The proceeds we raise as a result of the Offer will be used for clinical development, working capital and general corporate purposes. See the section entitled “Use of Proceeds” on page 35 for additional information. The purpose is also to simplify the Company’s outstanding warrants by making the terms of the Company’s outstanding warrants the same so investors can more easily understand its capital structure.

Agreements, Regulatory Requirements and Legal Proceedings

Other than as set forth under the sections entitled “The Exchange Offer—Interests of Directors, Officers and Affiliates” and “—Transactions and Agreements Concerning Our Securities” beginning on page 24 and page 25, respectively, and as set forth in our Certificate of Incorporation, as amended (“Certificate”), or Bylaws, as amended (“Bylaws”), there are no present or proposed agreements, arrangements, understandings or relationships between the Company, or any of its directors, executive officers, affiliates or any other person relating, directly or indirectly, to the Offer or to the securities of the Company that are the subject of this Offer.

There are no present plans or proposals which relate to or would result in: (a) other than the acquisition of Replacement Warrants and shares of Common Stock issuable upon exercise of Replacement Warrants pursuant to this Offer, the acquisition by any person of additional securities of the Company, or the disposition of securities of the Company; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation involving the Company or any of its subsidiaries; (c) a purchase, sale or transfer of a material amount of assets of the Company or any of its subsidiaries; (d) any change in the present Board or management of the Company; (e) any material change in the present dividend rate or policy, or indebtedness or capitalization of the Company; (f) any other material change in the Company’s corporate structure or business; (g) changes in the Certificate or Bylaws or instruments corresponding thereto or other actions which may impede the acquisition of control of the Company by any person; (h) a class of equity security of the Company becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (i) the suspension of the Company’s obligation to file reports pursuant to Section 15(d) of the Exchange Act.

The exercise of the Existing Warrants pursuant to the Offer would trigger the acquisition by such exercising holders of the Replacement Warrants and additional shares of the Common Stock of the Company.

Except for the requirements of applicable federal and state securities laws, we know of no federal or state regulatory requirements to be complied with or approvals to be obtained by us in connection with the Offer. There are no antitrust laws applicable to the Offer. The margin requirements under Section 7 of the Exchange Act, and the related regulations thereunder, are inapplicable.

There are no pending legal proceedings relating to the Offer.

 

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Interests of Directors, Officers and Affiliates

The Company does not beneficially own any of the Existing Warrants. The following table sets forth the Existing Warrants owned by our executive officers, directors and affiliates:

 

Name

   Aggregate
Existing
Warrants

beneficially
owned (#)
     Percentage of
Existing Warrants

beneficially owned
(%)
 

Jan Koe (1)

     350,000         100

Eric A. Wachter, PhD (2)

     666,666         100

Peter R. Culpepper (3)

     266,666         100

 

(1) Director of the Company.
(2) Chief Technology Officer of the Company.
(3) Chief Financial Officer and Chief Operating Officer of the Company.

Certain of our directors, officers and affiliates intend to exercise their Existing Warrants in accordance with the terms of the Offer: Jan Koe, director of the Company, intends to exercise 350,000 Existing Warrants, Eric A. Wachter, PhD, Chief Technology Officer of the Company, intends to exercise 666,666 Existing Warrants and Peter R. Culpepper, Chief Financial Officer and Chief Operating Officer of the Company, intends to exercise 266,666 Existing Warrants.

Market Price, Dividends and Related Stockholder Matters

Price Range of Common Stock

We currently have two equity securities that are listed on the NYSE MKT: Common Stock and the June 2015 Warrants. Our Common Stock is listed under the ticker symbol “PVCT” on the NYSE MKT. The June 2015 Warrants are listed under the ticker symbol “PVCTWS” on the NYSE MKT. The listing of the Replacement Warrants on the NYSE MKT is dependent upon the existence of an effective registration statement regarding the Replacement Warrants and the cooperation of the NYSE MKT for the Replacement Warrants.

We recommend that Existing Warrant holders obtain current market values for the Common Stock and June 2015 Warrants before deciding whether or not to exercise their Existing Warrants.

The following table lists the high and low sales prices for our Common Stock as listed on the NYSE MKT, by quarter from January 1, 2013 through December 28, 2015. Our Common Stock began trading on the NYSE MKT in May 2014. On December 28, 2015, the last reported sale price of our Common Stock was $0.39.

Price Range of Common Stock

 

     High      Low  

2013

     

First Quarter

   $ 0.88       $ 0.55   

Second Quarter

   $ 0.80       $ 0.58   

Third Quarter

   $ 1.14       $ 0.58   

Fourth Quarter

   $ 2.59       $ 0.75   

2014

     

First Quarter

   $ 6.03       $ 1.16   

Second Quarter

   $ 3.75       $ 0.30   

Third Quarter

   $ 1.20       $ 0.81   

Fourth Quarter

   $ 1.10       $ 0.75   

2015

     

First Quarter

   $ 0.93       $ 0.76   

Second Quarter

   $ 0.99       $ 0.49   

Third Quarter

   $ 0.70       $ 0.32   

Fourth Quarter (through December 28, 2015)

   $ 0.60       $ 0.38   

 

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As of December 28, 2015, the number of holders of record of our Common Stock was 1,186.

Price Range of June 2015 Warrants

The following table lists the high and low sales prices for our June 2015 Warrants as listed on the NYSE MKT, by quarter. Our June 2015 Warrants began trading on the NYSE MKT in June 2015. On December 28, 2015, the last reported sale price of our June 2015 Warrants was $0.2594.

 

     High      Low  

2015

     

First Quarter

   $ —         $ —     

Second Quarter (beginning June 19, 2015)

   $ 0.23       $ 0.12   

Third Quarter

   $ 0.66       $ 0.22   

Fourth Quarter (through December 28, 2015)

   $ 0.34       $ 0.20   

As of December 28, 2015, the number of holders of record of our June 2015 Warrants was one, DTC.

Dividend Policy

We have never declared or paid any cash dividends on our Common Stock and do not expect to pay any dividends for the foreseeable future. We intend to use future earnings, if any, in the operation and expansion of our business. Any future determination relating to our dividend policy will be made at the discretion of our Board, based on our financial condition, results of operations, contractual restrictions, capital requirements, business properties, restrictions imposed by applicable law and other factors our Board may deem relevant. Future debt covenants may prohibit payment of dividends.

Source and Amount of Funds

Because this transaction is an offer to Existing Warrant holders to exercise their Existing Warrants, there is no source of funds or other cash consideration being paid by us to those tendering Existing Warrants. We will use existing working capital to pay expenses associated with this Offer, estimated to be $3,003,772.

Transactions and Agreements Concerning Our Securities

Other than as set forth below and under “The Exchange Offer—Interests of Directors, Officers and Affiliates,” and as set forth in our Certificate and Bylaws, there are no agreements, arrangements or understandings between the Company, or any of its directors or executive officers, and any other person with respect to the securities of the Company that are the subject of this Offer.

The Company has retained Maxim to serve as its co-dealer manager in connection with the Offer pursuant to the terms of that certain Letter of Engagement, dated December 14, 2015 (the “LOE”). As compensation for services rendered by Maxim under the LOE, the Company has agreed to: (i) pay to Maxim a dealer manager fee consisting of a cash payment equal to four percent (4.0%) of the total proceeds received from the exchange of the Existing Warrants participating in the Offer; (ii) pay Maxim an investment banking advisory fee consisting of a cash payment equal to two percent (2.0%) of the total proceeds received by the Company in the Offer; (iii) pay Maxim $25,000 as an advance to be applied toward Maxim’s anticipated out-of-pocket expenses; and (iv) issue to Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to six percent (6.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised in connection with the Offer, other than Existing Warrants exercised pursuant to the Offer by clients of Network 1, as discussed below. The Company provided customary representations and indemnification to Maxim under the LOE. The LOE is effective for a period of one hundred and eighty (180) business days from December 14, 2015 and will continue to be in effect for a period of thirty (30) business days subsequent to the Company’s filing of a Form 8-K, which will be filed upon closing of the Offer.

 

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In connection with any Existing Warrants tendered by clients of Network 1 in the Offer, the Company will (i) issue Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer; and (ii) issue Network 1 warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer. Maxim will pay to Network 1 a cash fee equal to 100% of Maxim’s dealer manager fee for any Existing Warrants that are tendered by clients of Network 1 in the Offer.

In connection with the June 2015 Warrants, on June 19, 2015 we entered into a Warrant Agreement with Broadridge, appointing Broadridge as warrant agent for the June 2015 Warrants. In connection with this Offer, we have amended the Warrant Agreement to appoint Broadridge as warrant agent for the Replacement Warrants. As amended, the Warrant Agreement provides for the various terms, restrictions and governing provisions that dictate all of the terms of the Existing Warrants subject to the Offer. We have also engaged Broadridge as the Company’s exchange and escrow agent with respect to the Offer. Broadridge will receive reasonable and customary compensation for its services in connection with the Offer, plus reimbursement for out-of-pocket expenses, and will be indemnified by the Company against certain liabilities and expenses in connection therewith.

Accounting Treatment

The modification of the exercise price of the Existing Warrants and the Replacement Warrants are treated as an inducement to enter into the Exchange Offer. As such, the difference between the actual fair value of the Existing Warrants as of the date of their exchange and the actual fair value of the modified Existing Warrants and the fair value of the Replacement Warrants will be recorded as an incentive for early warrant exercise expense, with an offsetting entry to additional paid-in-capital. The fair value of the Existing Warrants exchanged will be determined using the Black-Scholes pricing model as of the date of the exchange. The fair value of the modified Existing Warrants and the Replacement Warrants issued will be determined using the Black-Scholes pricing model on the Closing Date. The Exchange Offer does not modify any terms of the warrant agreements or the current accounting treatment for the un-exchanged warrants.

Extension of Exchange Offer Period; Termination; Amendments; Conditions

We expressly reserve the right, in our sole discretion and at any time or from time to time, to extend the period of time during which the Offer is open. There can be no assurance, however, that we will exercise our right to extend the Offer Period. During any such extension, all Existing Warrant holders who previously tendered Existing Warrants will have a right to withdraw such previously tendered Existing Warrants until the expiration of the Offer Period, as extended.

Material changes to information previously published, sent or given to holders of the Existing Warrants in this Offer, including this Offer Letter/Prospectus, or in documents furnished subsequent thereto will be disseminated to holders of Existing Warrants to the extent required by applicable securities laws. Also, should we, pursuant to the terms and conditions of the Offer, materially amend the Offer, we will ensure that the Offer remains open long enough to comply with U.S. federal securities laws. It is possible that such changes could involve an extension of the Offer of up to 10 additional business days.

If we materially change the terms of the Offer or the information concerning the Offer, or waive a material condition of the Offer, we will extend the Offer to the extent required under applicable law. The minimum period during which the Offer must remain open following any material change in the terms of the Offer or information concerning the Offer (other than a change in exercise price, change in dealer’s soliciting fee or change in percentage of Existing Warrants sought, all of which require up to 10 additional business days) will depend on the facts and circumstances, including the relative materiality of such terms or information.

 

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If we extend the Offer Period, we will make a public announcement of such extension by no later than 9:00 a.m., Eastern Time, on the next business day following the scheduled expiration of the Offer.

The conditions to the Offer are:

 

    the existence of an effective registration statement regarding the Replacement Warrants and the Common Stock issuable upon the exercise of the Existing Warrants and of the Replacement Warrants;

 

    each Existing Warrant holder desiring to participate in the Offer delivering to the depositary in a timely manner a completed Letter of Transmittal and Notice of Guaranteed Delivery, along with the Existing Warrant holder’s Existing Warrants and proper discounted cash payment (in the form of a certified bank check or by wire transfer of immediately available funds, payable to the depositary); and

 

    approval for the listing of the Replacement Warrants on the NYSE MKT.

We may withdraw the Offer only if the conditions of the Offer are not satisfied prior to expiration of the Offer Period. Promptly upon any such withdrawal, we will return the tendered Existing Warrants along with the cash delivered therewith. We will announce any intention to withdrawal by disseminating notice by public announcement or otherwise as permitted by applicable law.

Except for the requirements of applicable federal and state securities laws, we know of no federal or state regulatory requirements to be complied with or approvals to be obtained by us in connection with the Offer.

Absence of Appraisal and Dissenters’ Rights

Holders of the Existing Warrants do not have any appraisal or dissenters’ rights under applicable law in connection with the Offer.

U.S. Federal Income Tax Consequences

General

The following summary describes the material U.S. federal income tax consequences of the Offer to U.S. Holders (as defined below) of the Existing Warrants, and the acceptance by such holders of the limited offer to exercise the Existing Warrants to acquire Common Stock and Replacement Warrants. This description also addresses the material U.S. federal income tax consequences of the exercise, disposition and lapse of the Replacement Warrants and the acquisition, ownership and disposition of the Common Stock received upon the exercise of the Existing Warrants. This summary assumes that holders hold the Existing Warrants, and will hold the Replacement Warrants and Common Stock received upon exercise of the Existing Warrants or Replacement Warrants, as capital assets (generally, property held for investment). This description does not address the tax considerations applicable to holders that may be subject to special tax rules, such as financial institutions, insurance companies, real estate investment trusts, regulated investment companies, grantor trusts, tax exempt organizations, dealers or traders in securities, or holders that hold Common Stock or Existing Warrants as part of a position in a straddle or as part of a hedging, conversion or integrated transaction for U.S. federal income tax purposes or holders that have a functional currency other than the U.S. dollar.

The following description addresses the U.S. federal income tax consequences to U.S. Holders only. A holder of Common Stock, Existing Warrants or Replacement Warrants is a “U.S. Holder” if such holder is:

 

    an individual who is a citizen of the United States;

 

    a corporation created or organized in or under the laws of the United States or any State thereof, including the District of Columbia;

 

    an estate the income of which is subject to U.S. federal income taxation regardless of its source; or

 

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    a trust (i) if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more U.S. Persons, as defined in Section 7701(a)(30) of the Code, have the authority to control all substantial decisions of such trust or (ii) that has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. citizen.

This description does not address the tax consequences to any person that is not a U.S. Holder. A holder of Existing Warrants that is not a U.S. Holder should consult its own tax advisor regarding the U.S. federal income tax consequences of participation in the Offer in light of its particular tax circumstances. If a partnership (or any other entity treated as a partnership for U.S. federal income tax purposes) holds Common Stock or Existing Warrants, the tax treatment of the partnership and a partner in such partnership generally will depend on the status of the partner and the nature of the activities of the partnership. Such partner should consult its own tax advisor as to the application of the U.S. tax laws to its particular situation.

Moreover, this description does not address the U.S. federal estate and gift tax, alternative minimum tax or other tax consequences of the acquisition, ownership and disposition of Common Stock, exercise of the Existing Warrants, or the exercise, disposition and lapse of the Replacement Warrants. Holders should consult their tax advisors with respect to the application of the U.S. tax laws to their particular situation.

This description is based on the Internal Revenue Code of 1986, as amended (the “Code”), existing and proposed Treasury Regulations promulgated thereunder, judicial decisions, published positions of the Internal Revenue Service (the “IRS”) and other applicable authorities, each as in effect on the date hereof. All of the foregoing are subject to change, possibly with retroactive effect, or differing interpretations by the IRS or a court, which could affect the tax consequences described herein. We have not obtained, and have no plans to request, a ruling from the IRS with respect to any of the U.S. federal income tax consequences described below, and as a result there can be no assurance that the IRS or the courts will agree with any of the conclusions described herein. We can provide no assurances that our treatment of the transaction will be respected by the IRS.

This summary is for general information only and is not intended to constitute a complete description of all tax consequences for U.S. Holders relating to the exercise of Existing Warrants in exchange for our Common Stock and the Replacement Warrants and the ownership and disposition of our Common Stock and the Replacement Warrants. You are urged to consult with your tax advisor regarding the tax consequences to you (including the application and effect of any state, local, or foreign income tax, estate tax and other tax laws) of participation in the Offer, the receipt of Common Stock and the Replacement Warrants, the ownership and disposition of our Common Stock, and the exercise, disposition and lapse of the Replacement Warrants.

The Exchange Offer

If you participate in the Offer in accordance with the procedures set forth in this Offer Letter/Prospectus, we intend to treat your participation for U.S. federal income tax purposes in the manner described below.

The U.S. federal income tax consequences of participation in the Offer are uncertain. We intend to treat the Offer as (i) a material modification of the terms of the Existing Warrant to provide that it is exercisable for Common Stock and the Replacement Warrant, followed by (ii) an exercise of the modified Existing Warrant. For U.S. federal income tax purposes, upon such a modification the participating holder would be deemed to exchange the “old” Existing Warrants for “new” Existing Warrants and then to exercise the “new” Existing Warrants. We intend to treat any such deemed exchange of “old” Existing Warrants for “new” Existing Warrants as a tax-free “recapitalization” within the meaning of Section 368(a)(1)(E) of the Code.

In accordance with such treatment as a recapitalization, (i) you generally would recognize no gain or loss on the deemed exchange; (ii) your tax basis in each “new” Existing Warrant received in the deemed exchange would be equal to the tax basis in such Existing Warrant; and (iii) your holding period in each “new” Existing Warrant would include your holding period in such “old” Existing Warrant.

 

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Due to lack of direct legal authority, it is unclear whether the IRS will agree with this characterization and whether the Offer will qualify as a recapitalization followed by an exercise of the “new” Existing Warrants for Common Stock and the Replacement Warrant. The IRS could take the position that the deemed exchange is properly treated as a fully taxable deemed exchange of “old” Existing Warrants for “new” Existing Warrants, in which case the holder would recognize capital gain or loss equal to the difference between the holder’s adjusted tax basis in the “old” Existing Warrant and the fair market value of the “new” Existing Warrant. In the alternative, it is also possible that the IRS could take the position that the Offer should be treated as an early exercise of the Existing Warrants (without a deemed exchange of the Existing Warrants), accompanied by the receipt of a taxable “fee” or Section 305 distribution, taxable to the participating holder as described below. The IRS could seek to re-characterize the transaction in other ways inconsistent with the Company’s treatment. The following discussion assumes that the Offer will be treated as a recapitalization exchange followed by exercise of the “new” Existing Warrant.

Assuming the Company’s treatment is correct for tax purposes, subject to the following discussion regarding the receipt of the Replacement Warrant upon the exercise of an Existing Warrant during the Offer Period, you should not recognize gain or loss on the exercise of the Existing Warrant and related receipt of Common Stock. The U.S. federal income tax consequences of the receipt of a Replacement Warrant upon exercise of an Existing Warrant during the Offer Period are, however, uncertain. We intend to take the position that a holder should be treated as simultaneously purchasing Common Stock and a Replacement Warrant upon the exercise of the Existing Warrant during the Offer Period, in which case the holder would not be required to recognize income or gain upon the receipt of the Replacement Warrant or Common Stock. In that case your aggregate tax basis in the Common Stock and the Replacement Warrant received would equal your tax basis in the Existing Warrant plus the exercise price paid pursuant to the Offer, and this aggregate basis would be allocated between the Common Stock and the Replacement Warrant based on their relative fair market values. Your holding period for the Common Stock and the Replacement Warrant received will begin on the day following the date of exercise.

The IRS may take the position, however, that the Replacement Warrant represents a taxable fee for exercising the Existing Warrant during the Offer Period, in which case you generally would recognize ordinary income in an amount equal to the fair market value of the Replacement Warrant on the date of receipt. In that case, your tax basis in the Replacement Warrant would equal the amount of income recognized and your tax basis in the Common Stock received would equal the sum of your tax basis in the Existing Warrant plus the exercise price paid pursuant to the Offer. Your holding period for the Common Stock and Replacement Warrant received would begin on the day following the date of exercise. In this connection, we note that for financial accounting purposes the fair value of the Replacement Warrants issued will be recorded as an incentive for early warrant exercise expense, with an offsetting entry to additional paid-in capital. See “The Exchange Offer—Accounting Treatment” beginning on page 26.

In the alternative, the IRS may take the position that the receipt of a Replacement Warrant should be treated as a distribution of a right to acquire stock under Section 305 of the Code, which could result in a taxable distribution to you in an amount equal to the fair market value of the Replacement Warrant on the date of receipt, depending on the circumstances (for example, if cash is distributed to holders of Common Stock within 36 months of the date of receipt of the Replacement Warrant). See the discussion below under the heading “Ownership and Disposition of Common Stock” regarding tax treatment of distributions. In that case, the tax basis in the Common Stock received would equal the sum of your tax basis in the Existing Warrant plus the exercise price paid pursuant to the Offer, and the tax basis in the Replacement Warrant would depend on the particular circumstances. Your holding period for the Common Stock and Replacement Warrant received would begin on the day following the date of exercise.

You should consult your own tax advisor regarding the tax consequences to you of participation in the Offer, in particular regarding the possibility that the Offer may result in current recognition of taxable income.

 

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If you do not participate in the Offer, we intend to treat the Offer as not resulting in any U.S. federal income tax consequences to you.

Ownership and Disposition of Common Stock

The following discussion summarizes the material U.S. federal income tax consequences of the ownership and disposition of the Common Stock applicable to U.S. Holders, subject to the limitations described above.

Ownership of Common Stock

Distributions of cash or property that we pay in respect to the Common Stock will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits (as determined under U.S. federal income tax principles) and will be includible in the U.S. Holder’s gross income upon receipt. Any such dividend will be eligible for the dividends received deduction if received by an otherwise qualifying corporate U.S. Holder that meets the holding period and other requirements for the dividends received deduction. Dividends paid by us to certain non-corporate U.S. Holders (including individuals), with respect to taxable years beginning on or before December 31, 2010, are eligible for U.S. federal income taxation at the rates generally applicable to long-term capital gains for individuals, provided that the holder receiving the dividend satisfies applicable holding period and other requirements. If the amount of a distribution exceeds our current and accumulated earnings and profits, such excess will be treated first as a tax-free return of capital to the extent of the U.S. Holder’s tax basis in such Holder’s Common Stock, and thereafter will be treated as capital gain.

Dispositions of Common Stock

Upon a sale, exchange or other taxable disposition of shares of the Common Stock, a U.S. Holder generally will recognize capital gain or loss equal to the difference between the amount realized on the sale, exchange or other taxable disposition and such holder’s adjusted tax basis in its shares of Common Stock. Such capital gain or loss will be long-term capital gain or loss if such holder has held such Common Stock for more than one year at the time of disposition. The deductibility of capital losses is subject to limitations under the Code.

Exercise, Disposition and Lapse of the Replacement Warrants

Exercise of Replacement Warrants

You will not recognize gain or loss on the exercise of a Replacement Warrant and related receipt of Common Stock. Your initial tax basis in the Common Stock received on the exercise of a Replacement Warrant will equal the sum of (i) your tax basis in such Replacement Warrant plus (ii) the exercise price paid on the exercise of such Replacement Warrant. Your holding period for the Common Stock received on the exercise of a Replacement Warrant should begin on the date that you exercise the Replacement Warrant.

Disposition of Replacement Warrants

You will recognize gain or loss on the sale or other taxable disposition of a Replacement Warrant in an amount equal to the difference, if any, between (i) the amount of cash plus the fair market value of any property received and (ii) your tax basis in the Replacement Warrant sold or otherwise disposed of. Any such gain or loss generally will be a capital gain or loss. Any such capital gain or loss will be short-term capital gain or loss or long-term capital gain or loss, depending on whether the Replacement Warrants are held for more than one year.

Lapse of Replacement Warrant

Upon the lapse or expiration of a Replacement Warrant, you should recognize a loss in an amount equal to your tax basis in the Replacement Warrant. Any such loss generally will be a capital loss. Any such capital loss will be short-term capital loss or long-term capital loss, depending on whether the Replacement Warrants are held for more than one year.

 

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Adjustment to Conversion Ratio

Under Section 305 of the Code, an adjustment to the number of shares of Common Stock that will be issued on exercise of the Replacement Warrants, or an adjustment to the exercise price of the Replacement Warrants, may be treated as a constructive distribution to a holder of the Replacement Warrants if, and to the extent that, such adjustment has the effect for U.S. federal income tax purposes of increasing such U.S. Holder’s proportionate interest in the earnings and profits or assets of the Company, depending on the circumstances of such adjustment (for example, if such adjustment is to compensate for a distribution of cash or other property to shareholders).

U.S. Backup Withholding Tax and Information Reporting Requirements

Information reporting generally will apply to payments of dividends on the Common Stock and proceeds from the sale or exchange of the Common Stock or Existing Warrants made within the United States to a U.S. Holder, other than an exempt recipient (including a corporation). If information reporting applies to any such payment, we or our paying agent will be required to withhold backup withholding tax from the payment if the holder fails to furnish its correct taxpayer identification number or otherwise fails to comply with, or establish an exemption from, such backup withholding tax requirements.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules from a payment to a U.S. Holder will be refunded or credited against the U.S. Holder’s U.S. federal income tax liability, if any, provided that the required information is furnished to the IRS.

Risk Factors

For a detailed discussion of some of the risks you should consider before participating in the Offer, you are urged to carefully review and consider the section entitled “Risk Factors” beginning on page 10 of this Offer Letter/Prospectus.

Additional Information; Miscellaneous

We have filed with the SEC a Tender Offer Statement on Schedule TO, of which this Offer Letter/Prospectus is a part. This Offer Letter/Prospectus does not contain all of the information contained in the Schedule TO and the exhibits to the Schedule TO. We recommend that Existing Warrant holders review the Schedule TO, including the exhibits, and our other materials that have been filed with the SEC before making a decision on whether to accept the Offer.

We will assess whether we are permitted to make the Offer in all jurisdictions. If we determine that we are not legally able to make the Offer in a particular jurisdiction, we reserve the right to withdraw the Offer in that particular jurisdiction and we will inform Existing Warrant holders of this decision. If we withdraw the Offer in a particular jurisdiction, the Offer will not be made to, nor will exercises or tenders be accepted from or on behalf of, the holders residing in that jurisdiction.

Our Board recognizes that the decision to accept or reject this Offer is an individual one that should be based on a variety of factors and Existing Warrant holders should consult with personal advisors if they have questions about their financial or tax situation. The information about this Offer from us is limited to this Offer Letter/Prospectus and the Schedule TO relating to this Offer.

We are subject to the information requirements of the Exchange Act, and in accordance therewith file and furnish reports and other information with the SEC. All reports and other documents we have filed or furnished with the SEC, including the Schedule TO relating to the Offer, or will file or furnish with the SEC in the future, can be accessed electronically on the SEC’s website at www.sec.gov.

 

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Any questions regarding procedures for delivering a completed Letter of Transmittal or Notice of Guaranteed Delivery, tendering your Existing Warrants, or tendering your proper discounted cash payment (in the form of a certified bank check or by wire transfer of immediately available funds, payable to the depositary) should be directed to Broadridge using the contact information below:

Broadridge Corporate Issuer Solutions, Inc.

By hand or overnight courier : Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail :* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

Wire Instructions:

US Bank

ABA/Routing number: 123000848

International/Swift code: USBKUS44IMT

Bank: U.S. Bank

800 Nicollet Mall

City/State/Country: Minneapolis, MN 55402 United States

Beneficiary Account Name: Broadridge

Account Number: 153910728465

Any questions or requests for assistance concerning the Offer should be directed to Maxim or the Company using the contact information below:

Maxim Group LLC

Attn: Summer Kotb

405 Lexington Avenue, 2nd Floor

New York, NY 10174

Phone: (212) 895-3511

Email: skotb@maximgrp.com

Network 1 Financial Securities, Inc.

Attn: William Heming Jr.

2 Bridge Avenue

Red Bank, NJ 07701

Phone: 1 (800) 866-7007

Email: billheming@netw1.com

Provectus Biopharmaceuticals, Inc.

Attn: Peter R. Culpepper

7327 Oak Ridge Highway, Suite A

Knoxville, Tennessee 37931

Phone: (866) 597-5999

Email: pete@pvct.com

We will amend our offering materials, including this Offer Letter/Prospectus, to the extent required by applicable securities laws to disclose any material changes to information previously published, sent or given to Existing Warrant holders.

 

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SELECTED FINANCIAL DATA

The following selected consolidated financial and operating data should be read in conjunction with (i) “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes thereto appearing in our Annual Report on Form 10-K for the year ended December 31, 2014 and (iii) “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our condensed consolidated financial statements and the related notes thereto included in our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2015, which is incorporated by reference in this Offer Letter/Prospectus. The selected consolidated statement of operations data set forth below for the years ended December 31, 2014, 2013 and 2012, and the selected consolidated balance sheet data set forth below at December 31, 2014 and 2013, are derived from our audited consolidated financial statements and related notes thereto which are incorporated by reference into this Offer Letter/Prospectus. The selected consolidated statement of operations data set forth below for the years ended December 31, 2011 and 2010, and the selected consolidated balance sheet data set forth below at December 31, 2012, 2011 and 2010, are derived from our audited consolidated financial statements and related notes thereto that are not incorporated by reference in this Offer Letter/Prospectus. The selected historical financial and operating data as of and for the nine months ended September 30, 2015 and 2014 were derived from our unaudited condensed consolidated financial statements incorporated by reference in this Offer Letter/Prospectus and in management’s opinion, reflect all adjustments, consisting of normal accruals, necessary for a fair presentation of the information in these periods. The historical results presented below are not necessarily indicative of the results to be expected for any future period.

 

     Nine Months
Ended

September 30,
2015
    Years ended December 31,  
       2014     2013     2012     2011     2010  
           (all amounts in thousands except per share data)  

Consolidated Statement of Operations Data:

        

Gain on settlement—net of discount

   $ —        $ 4,178      $ —        $ —        $ —        $ —     

Operating expenses

            

Research and development

     2,697        5,138        3,596        5,006        8,808        8,417   

General and administrative

     2,914        11,002        8,761        8,661        11,962        11,605   

Amortization

     168        671        671        671        671        671   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating loss

     (5,779     (12,633     (13,028     (14,338     (21,441     (20,693

Other income (loss), net

     (1     2,390        (14,670     1,769        2,006        2,141   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

     (5,780     (10,243     (27,698     (12,569     (19,435     (18,552

Dividends on preferred stock

     —          —          (1,188     (183     (247     (10,408
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss applicable to common stockholders

   $ (5,780   $ (10,243   $ (28,886   $ (12,752   $ (19,682   $ (28,960
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic and diluted loss per common share

   $ (0.03   $ (0.06   $ (0.22   $ (0.11   $ (0.19   $ (0.37

Weighted average number of common shares outstanding—basic and diluted

     204,610        175,828        132,001        112,987        105,725        78,818   

 

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     As of
September 30,
2015
    As of December 31,  
       2014     2013     2012     2011     2010  

Consolidated Balance Sheet Data:

            

Cash, cash equivalents and marketable securities

   $ 18,884      $ 17,392      $ 15,696      $ 1,222      $ 7,705      $ 8,087   

Patents, net

     3,080        3,584        4,255        4,926        5,598        6,268   

Other assets

     4,640        5,208        57        56        47        48   

Total assets

     26,604        26,184        20,008        6,204        13,350        14,403   

Current liabilities

     2,075        847        513        511        263        1,350   

Warrant liability

     —          147        12,866        1,300        3,067        2,353   

Preferred stock

     —          —          —          2        4        5   

Common stock

     205        185        160        118        110        91   

Additional paid-in capital

     195,469        181,299        152,520        122,626        115,690        96,953   

Accumulated deficit

     (171,144     (156,294     (146,051     (118,353     (105,784     (86,350

Total stockholders’ equity

     24,529        25,190        6,629        4,393        10,020        10,699   

Book value per share

     0.12        0.14        0.05        0.04        0.09        0.14   

The pro forma consolidated financial information presented below assumes that all 59,861,601 Existing Warrants are tendered for early exercise in the Offer on September 30, 2015, resulting in net proceeds to the Company of $41,892,429 after estimated offering expenses of $3,003,772.

 

     Nine Months
Ended

September 30,
2015
 

Consolidated Statement of Operations Data, Pro Forma:

  

Operating expenses

  

Total operating loss

   $ (5,779

Incentive expense for early warrant exercise

     (5,434

Other income, net

     (1

Net loss

     (11,214

Deficiency of earnings to cover fixed charges

     (11,214

 

     As of
September 30,
2015
 

Consolidated Balance Sheet Data, Pro Forma:

  

Cash, cash equivalents and marketable securities

   $ 60,776   

Total assets

     68,496   

Total liabilities

     2,075   

Stockholders’ equity

     66,421   

Book value per share

     0.25   

The pro forma consolidated financial information reflects the following adjustments:

(1) Cash proceeds from the exercise of 59,861,601 Existing Warrants at an exercise price of $0.75, resulting in net proceeds to the Company of $41,892,429 after estimated offering expenses of $3,003,772.

(2) The issuance of 59,861,601 shares of Common Stock upon the exercise of the Existing Warrants.

(3) The value of 59,861,601 Replacement Warrants to be issued as an inducement in the Exchange Offer based on the 59,861,601 Existing Warrants outstanding prior to December 28, 2015, using a Black-Scholes model assuming a stock price of $0.39, resulting in an estimated expense of approximately $5,434,000. The fair value of the modified Existing Warrants was determined to be zero as of December 28, 2015 using a Black-Scholes model.

 

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USE OF PROCEEDS

This Offer Letter/Prospectus relates to our Existing Warrants, the Replacement Warrants and the shares of our Common Stock underlying the Existing Warrants and the Replacement Warrants. We will not receive any proceeds as a result of the issuance of the Replacement Warrants, except that we will receive the exercise price upon the exercise of any Existing Warrants that are tendered in response to the Offer, with the exercise price of $0.75 per share (after taking into account the discounted exercise price). We will also receive the exercise price of $0.85 per share upon the exercise of any Replacement Warrants.

We intend to use the proceeds received from the exercise of the Existing Warrants and the Replacement Warrants, if any, for clinical development, working capital and general corporate purposes. We cannot estimate precisely the allocation of the net proceeds from this Offer. The amounts and timing of the expenditures may vary significantly, depending on numerous factors. Some of these factors include the amount of cash used in our operations, progress of our clinical trials, and other development efforts, including immunology work for both our oncology and dermatology programs to determine the unique immuno-chemoablative and anti-inflammatory characteristics of our respective drug product candidates. Accordingly, our management will have broad discretion in the application of the net proceeds of this Offer. Until we use the net proceeds of this Offer, we intend to invest the funds in short-term, investment grade, interest-bearing securities and short-term U.S. Treasury bills.

 

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DETERMINATION OF PRICE OF EXISTING WARRANTS

AND REPLACEMENT WARRANTS

Existing Warrants and Underlying Common Stock

The original exercise prices of the Existing Warrants was between $1.00 and $3.00 per share of our Common Stock (prior to taking into account the discounted exercise price). However, the Offer is to temporarily modify the terms of such Existing Warrants so that each holder who tenders Existing Warrants during the Offer Period for early exercise will be able to do so at an exercise price of $0.75 per share (after taking into account the discounted exercise price). The exercise prices for the Existing Warrants was arbitrarily determined by our Board and does not have any relationship to our assets, projected future earnings, book value or any other objective financial statement criteria of value at such time.

Replacement Warrants and Underlying Common Stock

The price of the shares of Common Stock issuable upon the exercise of Replacement Warrants is determined by reference to the exercise prices of such warrants, which is $0.85 per share of our Common Stock. Our Board established the exercise price for the Replacement Warrants based on its estimation of those warrant terms that would encourage Existing Warrant holders to participate in the Offer. The exercise price for the Replacement Warrants was arbitrarily determined by our Board and does not have any relationship to our assets, projected future earnings, book value or any other objective financial statement criteria of value.

DILUTION

The difference between the purchase price per share of the Common Stock issuable upon exercise of the Existing Warrants, and the pro forma net tangible book value per share of our Common Stock after this offering constitutes the dilution to purchasers in this offering. Net tangible book value per share is determined by dividing our tangible book value, which is our tangible assets less total liabilities, by the number of outstanding shares of our Common Stock. The information below assumes all of the Existing Warrants are exercised.

At September 30, 2015, our net tangible book value was $21,422,069, or approximately $0.10 per share of Common Stock. Without taking into account any other changes in the net tangible book value after September 30, 2015 other than to give effect to our receipt of the estimated proceeds from the issuance of 59,861,601 shares of Common Stock issuable upon exercise of the Existing Warrants offered by this Offer Letter/Prospectus, at an offering price of $0.75 per share, which represents the reduced exercise price of the Existing Warrants, our net tangible book value as of September 30, 2015, after giving effect to the items above, would have been approximately $63,314,498, or approximately $0.24 per share of Common Stock. This represents an immediate increase of $0.14 in net tangible book value per share to our existing stockholders and an immediate dilution of $0.51 per share to purchasers of Common Stock in this offering. Holders of Replacement Warrants issued as part of this offering who exercise their Replacement Warrants may experience dilution if our net tangible value at the time of exercise is less than the exercise price.

The following table illustrates the dilution to the purchasers in this offering on a per-share basis as if the offering had occurred on September 30, 2015:

 

Offering price of the shares of Common Stock

      $ 0.75 (1)  

Net tangible book value before this offering

   $ 0.10      

Increase attributable to purchasers in this offering

   $ 0.14      
  

 

 

    

Pro forma net tangible book value after this offering

      $ 0.24   
     

 

 

 

Dilution to purchasers in this offering

      $ 0.51   
     

 

 

 

 

(1) Represents the reduced exercise price of the Existing Warrants.

 

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This discussion of dilution, and the table set forth above, is based on 204,637,136 shares of our Common Stock issued and outstanding as of September 30, 2015 before giving effect to this offering and 264,498,737 shares of Common Stock issued and outstanding as of September 30, 2015 after giving effect to this offering. The foregoing discussion and table assume that none of the following securities have been exercised or converted for or into shares of our Common Stock as of September 30, 2015:

 

    20,125,000 shares of our Common Stock issuable upon exercise of the June 2015 Warrants outstanding as of September 30, 2015;

 

    up to 3,591,696 shares of our Common Stock issuable upon exercise of the warrants to be issued to Maxim as part of the Warrant Exchange Transaction, which number represents 6% of the maximum number of shares of Common Stock issuable upon exercise of the Existing Warrants;

 

    59,861,601 shares of our Common Stock issuable upon exercise of the Replacement Warrants;

 

    134,994 shares of our Common Stock issuable upon exercise of warrants not subject to the Exchange Offer outstanding as of September 30, 2015;

 

    9,545,214 shares of our Common Stock issuable upon exercise of stock options outstanding as of September 30, 2015; and

 

    19,850,000 shares of our Common Stock reserved for future issuance under our 2012 Stock Plan, as amended, and our 2014 Equity Compensation Plan.

 

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PLAN OF DISTRIBUTION

Replacement Warrants

The Replacement Warrants are being offered to holders of our Existing Warrants pursuant to the terms of the Offer set forth in the section entitled “The Offer.”

We are offering 59,861,601 shares of the Company’s Common Stock, which are issuable upon exercise of the Replacement Warrants. Pursuant to the terms of the Replacement Warrants, shares of our Common Stock will be issued to those Replacement Warrant holders who exercise their Replacement Warrants and provide payment of the exercise price of $0.85 per share through their brokers to our warrant agent, Broadridge, 51 Mercedes Way, Edgewood, New York 11717. We do not know if or when the Replacement Warrants will be exercised. We also do not know whether any of the shares of Common Stock acquired upon exercise of the Replacement Warrants will be sold.

Common Stock Issuable upon Exercise of Existing Warrants

We are offering 59,861,601 shares of the Company’s Common Stock, which are issuable upon exercise of the Existing Warrants during the Offer Period. Pursuant to the terms of the Existing Warrants, shares of our Common Stock will be issued to those Existing Warrant holders who exercise their Existing Warrants and provide payment of the applicable discounted exercise price through their brokers to our warrant agent, Broadridge, 151 Mercedes Way, Edgewood, New York 11717. We do not know the number of the Existing Warrants that will be exercised in connection with this Offer.

Persons Retained, Employed, Compensated or Used

The Company has retained Maxim to serve as its co-dealer manager in connection with the Offer pursuant to the terms of the LOE. As compensation for services rendered by Maxim under the LOE, the Company has agreed to: (i) pay to Maxim a dealer manager fee consisting of a cash payment equal to four percent (4.0%) of the total proceeds received from the exchange of the Existing Warrants participating in the Offer; (ii) pay Maxim an investment banking advisory fee consisting of a cash payment equal to two percent (2.0%) of the total proceeds received by the Company in the Offer; (iii) pay Maxim $25,000 as an advance to be applied toward Maxim’s anticipated out-of-pocket expenses; and (iv) issue to Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to six percent (6.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised in connection with the Offer, other than Existing Warrants exercised pursuant to the Offer by clients of Network 1, as discussed below. The Company provided customary representations and indemnification to Maxim under the LOE. The LOE is effective for a period of one hundred and eighty (180) business days from December 14, 2015 and will continue to be in effect for a period of thirty (30) business days subsequent to the Company’s filing of a Form 8-K, which will be filed upon closing of the Offer.

In connection with any Existing Warrants tendered by clients of Network 1 in the Offer, the Company will (i) issue Maxim (or its designated affiliates) warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer; and (ii) issue Network 1 warrants to purchase shares of Common Stock covering such number of shares of Common Stock equal to three percent (3.0%) of the total number of shares of the Common Stock underlying the Existing Warrants exercised by clients of Network 1 in the Offer. Maxim will pay to Network 1 a cash fee equal to 100% of Maxim’s dealer manager fee for any Existing Warrants that are tendered by clients of Network 1 in the Offer.

In connection with the June 2015 Warrants, on June 19, 2015 we entered into a Warrant Agreement with Broadridge, appointing Broadridge as warrant agent for the June 2015 Warrants. In connection with this Offer, we have amended the Warrant Agreement to appoint Broadridge as warrant agent for the Replacement Warrants.

 

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As amended, the Warrant Agreement provides for the various terms, restrictions and governing provisions that dictate all of the terms of the Existing Warrants subject to the Offer. We have also engaged Broadridge as the Company’s exchange and escrow agent with respect to the Offer. Broadridge will receive reasonable and customary compensation for its services in connection with the Offer, plus reimbursement for out-of-pocket expenses, and will be indemnified by the Company against certain liabilities and expenses in connection therewith.

DESCRIPTION OF SECURITIES TO BE REGISTERED

General

Our Certificate authorizes us to issue up to 400,000,000 shares of Common Stock having a par value of $0.001 per share and 25,000,000 shares of preferred stock having a par value of $0.001 per share (“Preferred Stock”). As of December 28, 2015, we had 204,979,100 shares of Common Stock issued and outstanding, with an aggregate of 90,751,595 shares of Common Stock issuable upon exercise of currently exercisable options and warrants. As of December 28, 2015, we had 0 shares of Preferred Stock issued and outstanding. The transfer agent and registrar for our Common Stock is Broadridge.

Common Stock

The description under the heading “Description of the Registrant’s Securities to be Registered” in our Registration Statement on Form 8-A, filed with the SEC on April 30, 2014, is hereby incorporated by reference into this registration statement. Any form of prospectus subsequently filed by us pursuant to Rule 424(b) under the Securities Act, that includes a description of the securities to be registered hereunder is also incorporated by reference into this registration statement.

Replacement Warrants

Each Existing Warrant holder who tenders Existing Warrants for early exercise pursuant to the terms of the Offer will receive, in addition to the shares of Common Stock purchased upon exercise, one Replacement Warrant to purchase the same number of shares of our Common Stock at a price of $0.85 per share, subject to adjustment pursuant to the terms of the Replacement Warrants, at any time after the closing of this offering. The Replacement Warrants will expire at 5:00 p.m., Eastern Time, on June 19, 2020.

The Replacement Warrants will be issued in registered form under a warrant agreement, as amended, between Broadridge, as warrant agent, and us. You should review a copy of the warrant agreement, which has been filed as an exhibit to the registration statement of which this Offer Letter/Prospectus is a part, for a complete description of the terms and conditions applicable to the Replacement Warrants.

The exercise price and number of shares of Common Stock issuable on exercise of the Replacement Warrants may be adjusted in certain circumstances including in the event of a stock dividend, or our recapitalization, reorganization, merger or consolidation.

The Replacement Warrants may be exercised upon surrender of the Replacement Warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the Replacement Warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price by certified or official bank check or by bank wire transfer in immediately available funds, for the number of Replacement Warrants being exercised. The Replacement Warrant holders do not have the rights or privileges of holders of Common Stock and any voting rights until they exercise their Replacement Warrants and receive shares of Common Stock. After the issuance of shares of Common Stock upon exercise of the Replacement Warrants, each holder will be entitled to one vote for each share of Common Stock held on record on all matters to be voted on by stockholders.

 

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No Replacement Warrants will be exercisable and we will not be obligated to issue shares of Common Stock unless at the time a holder seeks to exercise such Replacement Warrant, a prospectus relating to the Common Stock issuable upon exercise of the Replacement Warrants is current and the Common Stock has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the Replacement Warrants. In addition, holders of the Replacement Warrants are not entitled to net cash settlement and the Replacement Warrants may only be settled by delivery of shares of our Common Stock and not cash. In this event, under the terms of the warrant agreement, the Company shall, at the election of the registered holder of such warrant to be given within five (5) days of receipt of notice of such event, either rescind the previously submitted election to purchase and the Company shall return all consideration paid by registered holder of such warrant for such shares upon such rescission, or treat the attempted exercise as a cashless exercise pursuant to the terms of the warrant agreement and refund the cash portion of the exercise price to the registered holder of such Replacement Warrant. If, upon exercise of the Replacement Warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round up to the nearest whole number the number of shares of Common Stock to be issued to the Replacement Warrant holder.

LEGAL MATTERS

Legal matters in connection with the validity of the issuance of the securities offered by this Offer Letter/Prospectus will be passed upon by Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Nashville, Tennessee.

EXPERTS

The consolidated financial statements as of December 31, 2014 and 2013 and for each of the three years in the period ended December 31, 2014, and management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2014 incorporated by reference in this Offer Letter/Prospectus have been so incorporated in reliance on the reports of BDO USA, LLP, an independent registered public accounting firm, incorporated herein by reference, given on the authority of said firm as experts in auditing and accounting.

We have had no changes in our independent registered public accounting firm through the date of this Offer Letter/Prospectus or during our preceding two fiscal years, nor have we had any disagreements with our independent registered public accounting firm on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure during such time.

 

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 20. Indemnification of Directors and Officers

Section 102(b)(7) of the General Corporation Law of the State of Delaware (“DGCL”) allows a corporation to include in its certificate of incorporation a provision that limits or eliminates the personal liability of directors of a corporation or its stockholders for monetary damages for a breach of a fiduciary duty as a director, except where the director breached his duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved a stock repurchase or redemption in violation of Delaware corporate law or obtained an improper personal benefit.

Section 145 of the DGCL authorizes a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, other than an action by or in the right of the corporation, because such person is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with such suit or proceeding if he or she acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reason to believe his conduct was unlawful. Similar indemnity is authorized for such persons against expenses, including attorneys’ fees, actually and reasonably incurred in defense or settlement of any such pending, completed or threatened action or suit by or in the right of the corporation if such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and provided further that, unless a court of competent jurisdiction otherwise provides, such person shall not have been adjudged liable to the corporation. Any such indemnification may be made only as authorized in each specific case upon a determination by the stockholders or disinterested directors that indemnification is proper because the indemnitee has met the applicable standard of conduct.

Section 145 of the DGCL also authorizes a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or enterprise, against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the corporation would otherwise have the power to indemnify him or her. The company maintains insurance policies under which its directors and officers are insured, within the limits and subject to the limitations of the policies, against expenses in connection with the defense of actions, suits or proceedings, and certain liabilities that might be imposed as a result of such actions, suits or proceedings, to which they are parties by reason of being or having been a director or officer of the company.

Our certificate of incorporation and bylaws provide that the company will indemnify its directors and executive officers to the fullest extent provided by the DGCL and that any repeal or modification of such provisions will be prospective only and will not adversely affect the rights provided by the certificate of incorporation and bylaws in effect at the time of the alleged occurrence of any action or omission to act that is the cause of any proceeding against any agent of the company. In addition, our bylaws provide that the company is not required to indemnify any director or executive officer in connection with any proceeding initiated by such person unless the proceeding was authorized by our Board.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of Provectus pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

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Item 21. Exhibits and Financial Statement Schedules

 

  (a) Exhibits

The exhibits to this registration statement are listed in the Exhibit Index to this registration statement starting on page II-5, which Exhibit Index is hereby incorporated by reference.

 

Item 22. Undertakings

 

(a) The undersigned registrant hereby undertakes:

 

  (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

 

  (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

 

  (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

 

  (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

 

  (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

  (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

 

  (4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

 

  (i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

 

  (ii)

Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any

 

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  statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

 

  (5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

  (i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

 

  (ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

 

  (iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

 

  (iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 

(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

 

(d) The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11 or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

 

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-4 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Knoxville, State of Tennessee, on December 31, 2015.

 

PROVECTUS BIOPHARMACEUTICALS, INC.

By:

 

/s/ Peter R. Culpepper

Name:

 

Peter R. Culpepper

Title:

 

Chief Financial Officer and Chief Operating Officer

POWER OF ATTORNEY

The undersigned directors and officers do hereby constitute and appoint H. Craig Dees and Peter R. Culpepper and each of them, with full power of substitution, our true and lawful attorneys-in-fact and agents to do any and all acts and things in our name and behalf in our capacities as directors and officers, and to execute any and all instruments for us and in our names in the capacities indicated below, that such person may deem necessary or advisable to enable the registrant to comply with the Securities Act of 1933 and any rules, regulations and requirements of the Securities and Exchange Commission in connection with this registration statement, including specifically, but not limited to, power and authority to sign for us, or any of us, in the capacities indicated below, any and all amendments hereto under the Securities Act of 1933; and we do hereby ratify and confirm all that such person or persons shall do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated and on the dates indicated below.

 

Name

  

Capacity

 

Date

/s/ H. Craig Dees

H. Craig Dees, Ph.D.

   Chief Executive Officer (principal executive officer) and Chairman of the Board   December 31, 2015

/s/ Peter R. Culpepper

Peter R. Culpepper, CPA, MBA

   Chief Financial Officer (principal financial officer and principal accounting officer) and Chief Operating Officer   December 31, 2015

/s/ Timothy C. Scott

Timothy C. Scott, Ph.D.

  

President and Director

  December 31, 2015

/s/ Jan E. Koe

Jan E. Koe

  

Director

  December 31, 2015

/s/ Kelly M. McMasters

Kelly M. McMasters

  

Director

  December 31, 2015

/s/ Alfred E. Smith, IV

Alfred E. Smith, IV

  

Director

  December 31, 2015

 

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EXHIBIT INDEX

The following is a list of exhibits filed as part of this registration statement.

 

Exhibit
No.

 

Description

  3.1   Certificate of Incorporation of Provectus Biopharmaceuticals, Inc., as amended (incorporated by reference to Exhibit 3.1 of the Company’s quarterly report on Form 10-Q filed with the SEC on November 5, 2015).
  3.2   Bylaws of Provectus Biopharmaceuticals, Inc. (incorporated by reference to Exhibit 3.4 of the Company’s annual report on Form 10-K filed with the SEC on March 13, 2014).
  4.1**   Specimen certificate for the Common Stock, par value $0.001 per share, of the Company.
  4.2   Warrant Agency Agreement between Provectus Biopharmaceuticals, Inc. and Broadridge Corporate Issuer Solutions, Inc. (incorporated by reference to Exhibit 4.1 of the Company’s current report on Form 8-K filed with the SEC on June 19, 2015).
  4.3**   First Amendment to Warrant Agency Agreement between Provectus Biopharmaceuticals, Inc. and Broadridge Corporate Issuer Solutions, Inc.
  4.4   Form of Warrant Certificate (incorporated by reference to Exhibit 4.2 of the Company’s current report on Form 8-K filed with the SEC on June 19, 2015).
  4.5**   Exchange and Escrow Agent Agreement between Provectus Biopharmaceuticals, Inc. and Broadridge Corporate Issuer Solutions, Inc.
  5.1**   Legal opinion of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC.
  8.1**   Tax opinion of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC.
10.1***   Amended and Restated 2012 Stock Plan (incorporated herein by reference to Appendix A of the Company’s definitive proxy statement filed on April 30, 2012).
10.2***   Confidentiality, Inventions and Non-competition Agreement dated as of November 26, 2002 between the Company and H. Craig Dees (incorporated by reference to Exhibit 10.8 of the Company’s annual report on Form 10-KSB filed on April 15, 2003).
10.3***   Confidentiality, Inventions and Non-competition Agreement dated as of November 26, 2002 between the Company and Timothy C. Scott (incorporated by reference to Exhibit 10.9 of the Company’s annual report on Form 10-KSB filed on April 15, 2003).
10.4***   Confidentiality, Inventions and Non-competition Agreement dated as of November 26, 2002, between the Company and Eric A. Wachter (incorporated by reference to Exhibit 10.10 of the Company’s annual report on Form 10-KSB filed on April 15, 2003).
10.5   Material Transfer Agreement dated as of July 31, 2003 between Schering-Plough Animal Health Corporation and the Company (incorporated by reference to Exhibit 10.15 of the Company’s quarterly report on Form 10-QSB filed on August 14, 2003).
10.6   Securities Purchase Agreement dated as of January 13, 2011, by and between the Company and the purchasers identified on the signature pages thereto (incorporated by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on January 13, 2011).
10.7   Purchase Agreement dated as of December 22, 2010, by and between the Company and Lincoln Park Capital Fund, LLC (incorporated by reference to Exhibit 10.2 of the Company’s current report on Form 8-K filed on December 23, 2010).
10.8   Registration Rights Agreement dated as of December 22, 2010, by and between the Company and Lincoln Park Capital Fund, LLC (incorporated by reference to Exhibit 10.2 of the Company’s current report on Form 8-K filed on December 23, 2010).

 

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Exhibit
No.

 

Description

10.9   Purchase Agreement dated as of July 22, 2013, by and between Provectus Pharmaceuticals, Inc. and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed with the SEC on July 26, 2013).
10.10***   Amended and Restated Executive Employment Agreement by and between the Company and H. Craig Dees, Ph.D., dated April 28, 2014 (incorporated by reference to Exhibit 10.1 to the Company’s current report on Form 8-K filed on April 30, 2014).
10.11***   Amended and Restated Executive Employment Agreement by and between the Company and Timothy C. Scott, Ph.D., dated April 28, 2014 (incorporated by reference to Exhibit 10.2 to the Company’s Item current report on Form 8-K filed on April 30, 2014).
10.12***   Amended and Restated Executive Employment Agreement by and between the Company and Eric A. Wachter, Ph.D., dated April 28, 2014 (incorporated by reference to Exhibit 10.3 to the Company’s current report on Form 8-K filed on April 30, 2014).
10.13***   Amended and Restated Executive Employment Agreement by and between the Company and Peter R. Culpepper, dated April 28, 2014 (incorporated by reference to Exhibit 10.4 to the Company’s current report on Form 8-K filed on April 30, 2014).
10.14   2014 Equity Compensation Plan (incorporated herein by reference to Appendix A of the Company’s definitive proxy statement filed on April 30, 2014).
10.15   Controlled Equity OfferingSM Sales Agreement, dated April 30, 2014, by and between Provectus Biopharmaceuticals, Inc. and Cantor Fitzgerald & Co. (incorporated by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed with the SEC on April 30, 2014).
10.16   Stipulated Settlement Agreement and Mutual Release, dated June 6, 2004, by and among the Company as nominal defendant, H. Craig Dees, Timothy C. Scott, Eric A. Wachter, Peter R. Culpepper, Stuart Fuchs, Kelly M. McMasters, and Alfred E. Smith, IV, as defendants, and Glenn Kleba and Don B. Dale, as plaintiffs (Exhibits Omitted) (incorporated by reference to Exhibit 10.6 of the Company’s quarterly report on Form 10-Q filed on August 7, 2014).
10.17   Consent and Waiver of Rights, between Provectus Biopharmaceuticals, Inc. and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed with the SEC on June 24, 2015).
21.1   Subsidiaries of the Company (incorporated by reference to Exhibit 21 of the Company’s annual report on Form 10-K filed on March 16, 2011).
23.1   Consent of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC (included in Exhibit 5.1)
23.2**   Consent of BDO USA, LLP
24.1   Power of attorney (included in signature page of this Form S-4)
99.1**   Form of Letter of Transmittal
99.2**   Form of Notice of Guaranteed Delivery
99.3**   Form of letter to Warrant holders

 

** Filed herewith.
*** Indicates a management contract or compensatory plan or arrangement.

 

II-6

Exhibit 4.1

LOGO

NOT VALID UNLESS COUNTERSIGNED BY TRANSFER AGENT
INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA
NUMBER SHARES
PROVECTUS
PHARMACEUTICALS, INC.
AUTHORIZED COMMON STOCK: 150,000,000 SHARES
PAR VALUE: $0.001
CUSIP 74373F 10 0
THIS CERTIFIES THAT
IS THE RECORD HOLDER OF
Shares of Provectus Pharmaceuticals, Inc. Common Stock
transferable on the books of the Corporation in person or by duly authorized attorney upon surrender of this Certificate properly endorsed. This Certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.
CERTIFICATE OF STOCK
Dated:
CHIEF FINANCIAL OFFICER AND CHIEF OPERATING OFFICER
PROVECTUS PHARMACEUTICALS, INC.
CORPORATE
Seal
NEVADA
PRESIDENT
COUNTERSIGNED AND REGISTERED:
StockTrans, a Broadridge Company.
44 W. LANCASTER AVENUE
ARDMORE, PA 19003
BY
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED OFFICER


LOGO

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations:
TEN COM – as tenants in common
TEN ENT – as tenants by the entireties
JT TEN – as joint tenants with right of
survivorship and not as tenants in common
UNIF GIFT MIN ACT– Custodian
(Cust) (Minor)
under Uniform Gifts to Minors Act
(State)
UNIF TRANS MIN ACT– Custodian
(Cust) (Minor)
under Uniform Transfers to Minors Act
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFICATION NUMBER OF ASSIGNEE
Please print or typewrite name and address including postal zip code of assignee
Shares of the Common Stock evidenced by this Certificate, and do hereby irrevocably constitute and appoint
Attorney
to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.
DATED
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED:
THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, MUTILATED OR DESTROYED, THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE.

Exhibit 4.3

FIRST AMENDMENT TO WARRANT AGENCY AGREEMENT

THIS FIRST AMENDMENT TO WARRANT AGENCY AGREEMENT made as of December 31, 2015 (this “ Amendment ”), amends that certain Warrant Agency Agreement, dated June 19, 2015 (the “ Warrant Agency Agreement ”), between Provectus Biopharmaceuticals, Inc., a Delaware corporation, with offices at 7327 Oak Ridge Highway, Suite A, Knoxville, Tennessee 37931 (the “ Company ”), and Broadridge Corporate Issuer Solutions, Inc., with offices at 1717 Arch Street, Suite 1300, Philadelphia, Pennsylvania 19103 (the “ Warrant Agent ”). Capitalized terms that are used and not defined in this Amendment shall have the meanings assigned to them in the Warrant Agency Agreement.

WHEREAS , the Company is engaged in a tender offer (the “ Tender Offer ”) to promote the early exercise of certain of the Company’s outstanding warrants that were issued to investors in connection with various private placement transactions between March 11, 2011 and November 1, 2015 with exercise prices between $1.00 and $3.00 per share (the “ Existing Warrants ”);

WHEREAS , the Tender Offer, which, as defined by the documents relating to the Tender Offer, is the period from December 31, 2015, until February 15, 2015 at 4:00 P.M. Eastern Time, unless earlier withdrawn or otherwise extended by the Company (the “ Offer Period ”), so that each Existing Warrant holder who tenders an Existing Warrant for early exercise may exercise such Existing Warrant at a discount to the applicable strike price of $0.75, and will receive, in addition to the shares of the Company’s common stock, par value $0.001 per share (the “ Common Stock ”), purchased upon exercise of such Existing Warrant, a new warrant expiring June 19, 2020 to purchase the same number of shares of Common Stock at an exercise price of $0.85 per share (the “ Replacement Warrants ”);

WHEREAS , on June 19, 2015, the Company engaged the Warrant Agent to act on behalf of the Company in connection with the issuance, registration, transfer, exchange, redemption and exercise of 17,500,000 warrants issued to investors in connection with the Company’s public offering pursuant to that certain Registration Statement, No. 333-182476 on Form S-3 (the “ 2015 Registration Statement ”), filed with the U.S. Securities and Exchange Commission (the “ Commission ”), which warrants were the subject of the Warrant Agency Agreement (the “ Public Warrants and, together with the Replacement Warrants, the “ Warrants ”);

WHEREAS , as a result of the Tender Offer, the Company may issue and deliver Replacement Warrants to purchase up to 59,861,601 shares of Common Stock to those Existing Warrant holders who tender their Existing Warrants for early exercise during the Offer Period (the “ 2016 Warrant Shares ”), pursuant to a certain Registration Statement on Form S-4 (the “ 2016 Registration Statement ”), to be filed with the Commission;

WHEREAS , the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption and exercise of the Replacement Warrants in addition to the Public Warrants;

WHEREAS , Section 9.8 of the Warrant Agency Agreement provides that the Warrant Agency Agreement may be amended by the parties thereto without the consent of any registered Warrant holder for the purpose of adding or changing any provisions with respect to matters arising under the Warrant Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the holders of the Public Warrants; and

WHEREAS , the parties desire to amend the Warrant Agency Agreement to expand the scope of the Warrant Agent’s appointment to include the Replacement Warrants, in addition to the Public Warrants, and the parties deem that such amendment does not adversely affect the interest holders of the Public Warrants.

NOW, THEREFORE,  in consideration of the foregoing and the mutual agreements herein contained, and intending to be legally bound hereby, the Company and the Warrant Agent hereby agree as follows:

 

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1. Definition of “Warrants” to Include Replacement Warrants . The term “Warrants” as used in the Warrant Agency Agreement shall be deemed to include the Public Warrants and the Replacement Warrants.

2. Definition of “Warrant Shares” to Include 2016 Warrant Shares . The term “Warrant Shares” as used in the Warrant Agency Agreement shall be deemed to include the Warrant Shares (as defined in the Warrant Agency Agreement), registered with the Commission pursuant to the 2015 Registration Statement, and the 2016 Warrant Shares, registered with the Commission pursuant to the 2016 Registration Statement.

3. Amendment to Section 3.2 . Section 3.2 of the Warrant Agency Agreement shall be deleted in its entirety and replaced with the following:

3.2 Duration of Warrants . A Public Warrant may be exercised only during the period commencing on June 19, 2015, and terminating at 5:00 P.M., Philadelphia, Pennsylvania time on June 19, 2020 (the “ Public Warrant Expiration Date ”). A Replacement Warrant may be exercised only during the period commencing on the date of issuance of the Replacement Warrant, and terminating at 4:00 p.m., Philadelphia, Pennsylvania time on June 19, 2020 (the “ Replacement Warrant Expiration Date ” and together with the Public Warrant Expiration Date, the “ Expiration Date ”). Each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Warrant Agency Agreement shall cease at the close of business on the Expiration Date. “Issuance Date” shall mean, with respect to the Public Warrants, June 19, 2015, and with respect to the Replacement Warrants, the date such Replacement Warrant was issued. “Exercise Period” shall mean, with respect to the Public Warrants, the period commencing on June 19, 2015, and terminating on the Public Warrant Expiration Date, and with respect to the Replacement Warrants, the period commencing on the date such Replacement Warrant was issued, and terminating on the Replacement Warrant Expiration Date.

4. Binding Effect . Except to the extent expressly provided herein, the Warrant Agency Agreement shall remain in full force and effect in accordance with its terms. This Amendment shall be governed by and construed as one with the Warrant Agency Agreement, and the Warrant Agency Agreement shall be read and construed so as to incorporate this Amendment.

5. Governing Law . The validity, interpretation, and performance of this Amendment shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Amendment shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenience forum. Any such process or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 9.2 of the Warrant Agency Agreement. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim.

6. Counterparts; Effectiveness . This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

[ Signature Page Follows .]

 

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IN WITNESS WHEREOF , this First Amendment to Warrant Agreement has been duly executed by the parties hereto as of the day and year first above written.

 

PROVECTUS BIOPHARMACEUTICALS, INC.
By:   /s/ Peter R. Culpepper
Name:   Peter R. Culpepper
Its:   Chief Financial Officer, Chief Operating Officer and Chief Administrative Officer
BROADRIDGE CORPORATE ISSUER SOLUTIONS, INC.
By:   /s/ Robert Schifellite
Name:   Robert Schifellite
Its:   President, Investor Communication Solutions

Signature Page to First Amendment to Warrant Agency Agreement

Exhibit 4.5

December 31, 2015

EXCHANGE AND ESCROW AGENT AGREEMENT

Broadridge Corporate Issuer Solutions, Inc.

1717 Arch Street, Suite 1300

Philadelphia, Pennsylvania 19103

Ladies and Gentlemen:

Provectus Biopharmaceuticals, Inc., a Delaware corporation (the “ Issuer ”), proposes to offer (the “ Exchange Offer ”) to holders of certain outstanding warrants (the “ Existing Warrants ”) to purchase shares of common stock, $0.001 par value per share (“ Common Stock ”), to temporarily modify the terms of such Existing Warrants so that each holder who tenders Existing Warrants during the offer period for early exercise will be able to do so at an exercise price of $0.75 per share (Existing Warrants currently have exercise prices ranging from $1.00 to $3.00 per share). Each Existing Warrant holder who tenders Existing Warrants for early exercise during the offer period will receive, in addition to the Common Stock purchased upon exercise, an equal number of warrants to purchase Common Stock (the “ Replacement Warrants ”). Each Replacement Warrant will have a cash exercise price of $0.85 per share and will expire on June 19, 2020, unless sooner exercised. The terms and conditions of the Exchange Offer as currently contemplated are set forth in a prospectus, dated December 31, 2015 (the “ Prospectus ”), and a Letter of Transmittal (the “ Letter of Transmittal ”), copies of which are attached as Exhibit A to this Exchange and Escrow Agent Agreement (this “ Agreement ”), both of which are proposed to be distributed to all record holders of the Existing Warrants.

The Issuer hereby appoints Broadridge Corporate Issuer Solutions, Inc. (i) to act as exchange agent (in such capacity, the “ Exchange Agent ”) in connection with the Exchange Offer and (ii) to act as escrow agent (in such capacity, the “ Escrow Agent ”) to hold in escrow funds to be received from the exercise of the Existing Warrants and the issuance of Common Stock and to dispense the Escrow Funds (as defined herein) in accordance with the terms of this Agreement. References hereinafter to “you” shall refer to Broadridge Corporate Issuer Solutions, Inc.

The Exchange Offer shall be commenced by the Issuer on or about December 31, 2015 (the “ Effective Time ”) and shall expire at 4:00 p.m., Eastern time, on February 15, 2016 or on such subsequent date or time to which the Issuer may extend such Exchange Offer (each, an “ Expiration Date ”). The Letter of Transmittal accompanying the Prospectus is to be used by the holders of the Existing Warrants to accept the Exchange Offer and contains instructions with respect to the delivery of certificates for Existing Warrants tendered in connection therewith.

Subject to the terms and conditions set forth in the Prospectus, the Issuer expressly reserves the right to extend the Exchange Offer from time to time and may extend the Exchange Offer by giving oral (promptly confirmed in writing) or written notice to you before 11:00 a.m., Eastern time, on the business day following the previously scheduled Expiration Date.

The Issuer expressly reserves the right to amend the Exchange Offer or to delay acceptance of the Existing Warrants, or to terminate the Exchange Offer, and not to accept for exchange any Existing Warrants not theretofore accepted for exchange, if in the Issuer’s sole


judgment, any of the conditions of the Exchange Offer specified in the Prospectus under the caption “The Exchange Offer—Conditions of the Exchange Offer” shall not have been satisfied. The Issuer will give oral (promptly confirmed in writing) or written notice of any amendment, termination or nonacceptance to you as promptly as practicable.

In carrying out your duties as the Escrow Agent, you agree to act in accordance with the following instructions:

A. You accept the designation as escrow agent under this Agreement and agree to receive and hold the Escrow Funds (as defined below) and to disburse the Escrow Funds as provided in this Agreement. Each holder exercising an Existing Warrant will pay to you the applicable discounted exercise price of such Existing Warrant (the “ Escrowed Funds ”). You agree that you will from time to time accept funds from the holders of the Existing Warrants for the exercise of Existing Warrants in the form of checks or by wire transfer in immediately available funds. All checks shall be made payable to the Issuer. If any check does not clear normal banking channels in due course, you will promptly notify the Issuer. Any check, which does not clear normal banking channels and is returned by the drawer’s bank to you will be promptly turned over to the Issuer along with all other documents relating to the Exchange Offer. Any check received that is made payable to a party other than the Issuer shall be returned to the proper party.

B. You shall hold the Escrow Funds in escrow and shall only make disbursements in respect thereof upon written notification to you by the Issuer following the Expiration Date (the “ Release Notice ”), and, subject to subsection (C) below, you shall pay to the Issuer out of the Escrow Funds the specific amount set forth in the Release Notice.

C. If the Issuer terminates the Exchange Offer at any time prior to the Expiration Date and delivers the Release Notice to you of such termination, you shall return the Escrowed Funds which are collected funds as directed in writing by the Issuer to the respective holders of Existing Warrants in amounts equal to the amount theretofore paid by each of them. All uncleared checks representing the Escrowed Funds which are not collected funds as of the Expiration Date shall be collected by the Escrow Agent, and together with all related Exchange Offer documents thereof shall be delivered to the Issuer by you, unless you are otherwise specifically directed in writing by the Issuer.

D. Upon your receipt of the Escrowed Funds, you shall invest the funds in deposit accounts or certificates of deposit which are fully insured by the Federal Deposit Insurance Corporation or another agency of the United States government, short-term securities issued or fully guaranteed by the United States government, federal funds, or such other investments as you and the Issuer shall agree. The Issuer shall provide you with instructions from time to time concerning in which of the specific investment instruments described above the Escrowed Funds shall be invested, and you shall adhere to such instructions. Interest and other earnings shall start accruing on such funds as soon as such funds would be deemed to be available for access pursuant to your own banking policies.

E. In the event the Issuer receives the Escrowed Funds pursuant to (B) above, any interest earned on the Escrowed Funds shall be retained by the Issuer. In the event the Escrowed

 

2


Funds are not deliverable to the Issuer pursuant to (C) above, interest on the Escrowed Funds shall be distributed by the Escrow Agent to the holders of Existing Warrants in proportion to the respective amounts for the exercise of their Existing Warrants and the respective periods for which the Escrowed Funds have been held.

In carrying out your duties as Exchange Agent, you are to act in accordance with the following instructions:

1. You will perform such duties and only such duties as are specifically set forth in the section of the Prospectus captioned “The Exchange Offer” or as specifically set forth herein; provided, however , that in no way will your general duty to act in good faith be discharged by the foregoing.

2. From and after the Effective Time, you are hereby authorized and directed to accept and to examine each of the Letters of Transmittal and any other documents delivered or mailed to you by or for holders of the Existing Warrants to ascertain whether: (i) the Letters of Transmittal contain the information required to be set forth therein and any such other documents are duly executed and properly completed in accordance with instructions set forth therein; and (ii) the Existing Warrants have otherwise been properly tendered. In each case where the Letter of Transmittal or any other document has been improperly completed or executed or some other irregularity in connection with the acceptance of the Exchange Offer exists, you will endeavor to inform the presenters of the need for fulfillment of all requirements and to take any other action as may be reasonably necessary or advisable, or reasonably requested by the Issuer, to cause such irregularity to be corrected. If such condition is not promptly remedied, you shall report such condition to the Issuer and await its direction. All questions as to the validity, form, eligibility (including timeliness of receipt), acceptance and withdrawal of any Existing Warrants tendered or delivered shall be determined by the Issuer, in its sole discretion; provided , however , that you shall reasonably cooperate with the Issuer in attempting to resolve all such questions.

3. With the approval of the Chief Financial Officer of the Issuer (such approval, if given orally, to be promptly confirmed in writing) or any other party designated in writing, by such Chief Financial Officer, you are authorized to waive any irregularities in connection with any tender of Existing Warrants pursuant to the Exchange Offer.

4. Tenders of Existing Warrants may be made only as set forth in the Letter of Transmittal and in the section of the Prospectus captioned “The Exchange Offer—Procedure for Exercising and Tendering Existing Warrants,” and Existing Warrants or portions thereof shall be considered properly tendered to you only when tendered in accordance with the procedures set forth therein.

You are authorized to request that any person tendering Existing Warrants provide you with such additional documents as you or the Issuer deem appropriate. You are hereby authorized and directed to process withdrawals of tenders to the extent withdrawal thereof is authorized by the Exchange Offer.

The Issuer reserves the absolute right (i) to reject any or all tenders of any particular Existing Warrant determined by the Issuer not to be in proper form or the acceptance or

 

3


exchange of which may, in the opinion of Issuer’s counsel, be unlawful and (ii) to waive any of the conditions of the Exchange Offer or any defects, irregularities or conditions to the tender of any Existing Warrant, and the Issuer’s interpretation of the terms and conditions of such Exchange Offer (including the Letter of Transmittal and the instructions set forth therein) will be final and binding. With respect to the matters in (i) and (ii) above, you shall have no duty, responsibility or liability.

Notwithstanding the provisions of this Section 4, any Existing Warrants that the Chief Financial Officer of the Issuer shall approve as having been properly tendered shall be considered to be properly tendered (such approval, if given orally, shall be promptly confirmed in writing).

5. You shall advise the Issuer with respect to any Existing Warrants received subsequent to the Expiration Date and accept the Issuer’s instructions with respect to disposition of such Existing Warrants.

6. You shall accept tenders:

(a) in cases where the Existing Warrants are registered in two or more names only if signed by all named holders; and

(b) in cases where the signing person (as indicated on the Letter of Transmittal) is acting in a fiduciary or a representative capacity only when proper evidence of his or her authority so to act is submitted.

You shall not accept tenders from persons other than the registered holder of Existing Warrants, unless you have received prior written approval from the Chief Financial Officer.

7. Upon satisfaction or waiver of all of the conditions to the Exchange Offer, the Issuer will notify you (such notice, if given orally, to be promptly confirmed in writing) of its acceptance, promptly after the Expiration Date, of all related Existing Warrants properly tendered and you, on behalf of the Issuer, will exchange such Existing Warrants for Replacement Warrants, issue Common Stock and cause such Existing Warrants to be cancelled. Delivery of Replacement Warrants and Common Stock will be made on behalf of the Issuer by you of Existing Warrants tendered promptly after notice (such notice if given orally, to be promptly confirmed in writing) of acceptance of said Existing Warrants by the Issuer; provided, however, that in all cases, Existing Warrants tendered pursuant to the Exchange Offer will be exchanged only after timely receipt by you of confirmation of a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) with any required signature guarantees and, if applicable, any other documents required by the Issuer or by the terms of the Exchange Offer.

8. Tenders pursuant to the Exchange Offer are irrevocable, except that, subject to the terms and upon the conditions set forth in the Prospectus and the Letter of Transmittal, Existing Warrants tendered pursuant to the Exchange Offer may be withdrawn at any time prior to the Expiration Date.

 

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9. The Issuer shall not be required to exchange any Existing Warrants tendered if any of the conditions set forth in the related Exchange Offer are not met. Notice of any decision by the Issuer not to exchange any Existing Warrants tendered shall be given (if given orally, to be promptly confirmed in writing) by the Issuer to you.

10. If, pursuant to the Exchange Offer, the Issuer does not accept for exchange all or part of the Existing Warrants tendered because of an invalid tender, the occurrence of certain other events set forth in the Prospectus under the caption “The Exchange Offer—General Terms” or otherwise, you shall as soon as practicable after the expiration or termination of the Exchange Offer return any related required documents that are in your possession, to the persons who deposited the Existing Warrants not accepted for exchange.

11. You are not authorized to pay or offer to pay any concessions, commissions or solicitation fees to any broker, dealer, bank or other persons or to engage or utilize any person to solicit tenders.

12. As Exchange Agent hereunder you:

(a) shall not be liable for any action or omission to act unless the same constitutes your own gross negligence, willful misconduct or bad faith, and in no event shall you be liable to a securityholder, the Issuer or any third party for special, indirect or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) arising in connection with this Agreement irrespective of whether you have been advised of the likelihood of such loss or damage and regardless of the form of action;

(b) shall have no duties or obligations other than those specifically set forth herein, or as may be subsequently agreed to in writing between you and the Issuer;

(c) will be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value or genuineness of any of the Existing Warrants deposited with you pursuant to the Exchange Offer, and will not be required to and will make no representation as to the validity, value or genuineness of the Exchange Offer;

(d) shall not be obligated to take any legal action hereunder which might in your judgment involve any expense or liability, unless you shall have been furnished with indemnity reasonably satisfactory to you;

(e) may conclusively rely on and shall be protected in acting in reliance upon any certificate, instrument, opinion, notice, letter, telegram or other document or security delivered to you and reasonably believed by you to be genuine and to have been signed or presented by the proper person or persons;

(f) may act upon any tender, statement, request, document, agreement, certificate or other instrument whatsoever not only as to its due execution and validity and effectiveness of its provisions, but also as to the truth and accuracy of any information contained therein, which you shall in good faith believe to be genuine or to have been signed or presented by the proper person or persons;

 

5


(g) may conclusively rely on and shall be protected in acting upon written or oral instructions from any authorized officer of the Issuer;

(h) may consult with counsel of your selection with respect to any questions relating to your duties and responsibilities and the advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by you hereunder in good faith and in accordance with the advice or opinion of such counsel;

(i) shall in no event be responsible or liable for any failure or delay in the performance of your obligations under this Agreement arising out of or caused by, directly or indirectly, forces beyond your reasonable control, including without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software or hardware) services; and

(j) shall not advise any person tendering Existing Warrants pursuant to the Exchange Offer as to the wisdom of making such tender or as to the market value or decline or appreciation in market value of any Existing Warrants or the Common Stock and shall not solicit any holder or beneficial owner for the purpose of causing such holder or beneficial owner to tender such holder’s or beneficial owner’s Existing Warrants.

13. You shall take such action as may from time to time be requested by the Issuer (and such other action as you may deem appropriate) to furnish copies of the Prospectus and Letter of Transmittal or such other forms as may be approved from time to time by the Issuer, to all persons requesting such documents and to accept and comply with telephone, mail or facsimile requests for information relating to the Exchange Offer, provided that such information shall relate only to the procedures for accepting (or withdrawing from) the Exchange Offer. The Issuer will furnish you with copies of such documents on your request. All other requests for information relating to the Exchange Offer shall be directed to the Issuer, Attention: Peter Culpepper, Chief Financial Officer.

14. You shall advise by electronic communication to Peter Culpepper, the Chief Financial Officer (pete@pvct.com), and such other person or persons as the Issuer may request, daily (and more frequently during the week immediately preceding the Expiration Date if requested) up to and including the Expiration Date, as to the number of Existing Warrants which have been tendered since the previous report and the aggregate number tendered pursuant to the Exchange Offer until the Expiration Date and the items received by you pursuant to this Agreement. In addition, you will also inform, and cooperate in making available to, the Issuer or any such other person or persons as the Issuer may request upon oral request made from time to time prior to the Expiration Date of such other information as they may reasonably request. Such cooperation shall include, without limitation, the granting by you to the Issuer and such person as the Issuer may request of access to those persons on your staff who are responsible for receiving tenders in order to ensure that immediately prior to the Expiration Date the Issuer shall

 

6


have received information in sufficient detail to enable the Issuer to decide whether to extend the Exchange Offer. Within two business days after the Expiration Date, (i) you shall prepare a final list of all persons whose tenders were accepted, the aggregate number of Existing Warrants tendered and the aggregate number of Existing Warrants accepted, and (ii) you shall deliver said list to the Issuer.

15. Letters of Transmittal shall be stamped by you as to the date and, after the expiration of the Exchange Offer, the time, of receipt thereof and, if defective, the date and time the last defect was cured or waived and shall be preserved by you for a period of time at least equal to the period of time you preserve other records pertaining to the transfer of securities. You shall dispose of unused Letters of Transmittal and other surplus materials by returning them to the Issuer as soon as practicable.

16. For services rendered as Exchange Agent and Escrow Agent hereunder, you shall be entitled to such compensation as shall be agreed in writing between the Issuer and you. The provisions of this Section 16 shall survive the termination of this Agreement and your resignation or removal hereunder.

17. You hereby acknowledge receipt of the Prospectus and the Letter of Transmittal. Any inconsistency between this Agreement, on the one hand, and the Prospectus and the Letter of Transmittal (as they may be amended from time to time), on the other hand, shall be resolved in favor of the latter two documents, except with respect to your duties, liabilities and indemnification as Exchange Agent.

18. The Issuer covenants and agrees to fully indemnify and hold you harmless against any and all losses, claims, damages, liabilities, costs and expenses, including actual and reasonable costs of investigation and actual and reasonable attorneys’ fees and expenses, incurred without gross negligence or willful misconduct on your part, arising out of or in connection with its acceptance or the performance of your duties as Exchange Agent, including any act, omission, delay or refusal made by you in reliance upon any signature, endorsement, assignment, certificate, order, request, notice, instruction or other instrument or document reasonably believed by you to be valid, genuine and sufficient and in accepting any tender or effecting any transfer of Existing Warrants believed by you in good faith to be authorized, and in delaying or refusing in good faith to accept any tenders or effect any transfer of Existing Warrants.

The Issuer further covenants and agrees to fully indemnify and hold you harmless against any and all losses, claims, damages, liabilities, costs and expenses, including actual and reasonable costs of investigation and actual and reasonable attorneys’ fees and expenses, incurred without gross negligence or willful misconduct on your part, arising out of or in connection with its acceptance or the performance of your duties as Escrow Agent, including any litigation arising from this Agreement or involving the subject matter hereof. The parties hereto further agree that you shall not be liable for failure of the bank into which the Escrow Funds are deposited.

In each case, the Issuer shall be notified by you, by letter or facsimile transmission, of the written assertion of a claim against you or of any other action commenced against you, promptly

 

7


after you shall have received any such written assertion or shall have been served with a summons in connection therewith. The Issuer shall be entitled to participate at its own expense in the defense of any such claim or other action and, if the Issuer so elects, the Issuer shall assume the defense of any suit brought to enforce any such claim and you shall reasonably cooperate with the Issuer in the defense. In the event that the Issuer shall assume the defense of any such suit, the Issuer shall not be liable for the fees and expenses of any additional counsel thereafter retained by you, so long as the Issuer shall retain counsel satisfactory to you to defend such suit, and so long as you have not determined, in your reasonable judgment, that a conflict of interest exists between you and the Issuer.

The provisions of this Section 18 shall survive the termination of this Agreement and your resignation or removal hereunder.

19. You shall arrange to comply with all requirements under the tax laws of the United States imposed with respect to the activities performed by you pursuant to this Agreement, including those relating to missing Tax Identification Numbers, and shall file any appropriate reports with the Internal Revenue Service. Any questions with respect to any tax matters relating to the Exchange Offer shall be referred to the Issuer, and you shall have no duty with respect to such matter; provided , that you shall reasonably cooperate with the Issuer in attempting to resolve such questions.

20. You shall deliver or cause to be delivered, in a timely manner to each governmental authority to which any transfer taxes are payable in respect of the exchange of Existing Warrants the Issuer’s check in the amount of all transfer taxes so payable; provided, however, that you shall reimburse the Issuer for amounts refunded to you in respect of your payment of any such transfer taxes, at such time as such refund is received by you.

21. This Agreement and your appointment as Exchange Agent and as Escrow Agent hereunder shall be governed by, and construed and enforced in accordance with, the laws of the State of New York applicable to agreements made and to be performed entirely within such state, and without regard to conflicts of law principles, and shall inure to the benefit of, and the obligations created hereby shall be binding upon, the successors and assigns of each of the parties hereto.

22. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same agreement.

23. In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

24. This Agreement shall not be deemed or construed to be modified, amended, rescinded, cancelled or waived, in whole or in part, except by a written instrument signed by a duly authorized representative of the party to be charged. This Agreement may not be modified orally.

 

8


25. Unless otherwise provided herein, all notices, requests and other communications to any party hereunder shall be in writing (including facsimile or similar writing) and shall be given to such party, addressed to it, at its address or telecopy number set forth below:

If to the Issuer:

Provectus Biopharmaceuticals, Inc.

7327 Oak Ridge Highway, Suite A

Knoxville, Tennessee 37931

Telephone: (866) 594-5999

Facsimile: 1 (866) 998-0005

Attention: Peter Culpepper, CFO, COO

If to the Exchange Agent/Escrow Agent:

Broadridge Corporate Issuer Solutions, Inc.

1717 Arch Street, Suite 1300

Philadelphia, Pennsylvania 19103

Telephone: (610) 649-7300

26. Unless terminated earlier by the parties hereto, this Agreement shall terminate with respect to the Exchange Offer ninety (90) days following the Expiration Date of the Exchange Offer. Notwithstanding the foregoing, Sections 16 and 18 shall survive the termination of this Agreement. Upon any termination of this Agreement, you shall promptly deliver to the Issuer any funds or property then held by you as Exchange Agent under this Agreement.

27. You may resign from your duties under this Agreement with respect to the Exchange Offer or with respect to your duties as Escrow Agent by giving to the Issuer thirty (30) days’ prior written notice, and the Issuer may terminate your appointment hereunder on thirty (30) days’ prior written notice. Any successor exchange agent or escrow agent, as the case may be, appointed by the Issuer shall, upon such successor’s acceptance of such appointment, be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Exchange Agent or Escrow Agent, as the case may be, without any further act or deed, but you shall deliver and transfer to the successor exchange agent or escrow agent, as the case may be, at the expense of the Issuer, any property at the time held by you hereunder and shall, upon payment of all amounts due and owing to you hereunder, execute and deliver, at the expense of the Issuer, any further assurance, conveyance, act or deed necessary for such purpose as the Issuer may reasonably request. If an instrument of acceptance by a successor exchange agent or escrow agent shall not have been delivered to the Exchange Agent or Escrow Agent, as the case may be, within thirty (30) days after the giving of such notice of removal or resignation, the Exchange Agent or Escrow Agent, as the case may be, being removed or resigning may petition any court of competent jurisdiction for the appointment of a successor Exchange Agent or Escrow Agent, as the case may be. The Issuer will pay all reasonable expenses in connection with such petition.

28. You may not transfer or assign or delegate your rights or responsibilities under this Agreement without the prior written consent of the Issuer.

 

9


29. This Agreement shall be binding and effective as of the date hereof.

30. THE ISSUER AND YOU HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE EXISTING WARRANTS, THE REPLACEMENT WARRANTS, THE COMMON STOCK OR THE TRANSACTIONS CONTEMPLATED HEREBY.

[Signature page follows.]

 

10


Please acknowledge receipt of this Agreement and confirm the arrangements herein provided by signing and returning the enclosed copy.

 

PROVECTUS BIOPHARMACEUTICALS, INC.
By:   /s/ Peter Culpepper
  Name: Peter Culpepper
  Title:   Chief Financial Officer

 

Accepted as of the date first above written:

BROADRIDGE CORPORATE ISSUER SOLUTIONS, INC.

as Exchange Agent/Escrow Agent

By:   /s/ Robert Schifellite
  Name: Robert Schifellite
  Title:   President, Investor Communication Solutions

Signature page to Exchange and Escrow Agent Agreement


Exhibit A

PROSPECTUS AND LETTER OF TRANSMITTAL

Exhibit A

Exhibit 5.1

 

LOGO    COMMERCE CENTER
   SUITE 800
   211 COMMERCE STREET
   NASHVILLE, TENNESSEE 37201
   PHONE: 615.726.5600
   FAX: 615.726.0464
   MAILING ADDRESS:
   P.O. BOX 190613
   NASHVILLE, TENNESSEE 37219
  

 

www.bakerdonelson.com

L ORI B. M ETROCK

Direct Dial : (615) 726-5768

Direct Fax : (615) 744-5768

E-Mail Address : lmetrock@bakerdonelson.com

December 31, 2015

Board of Directors

Provectus Biopharmaceuticals, Inc.

7327 Oak Ridge Highway, Suite A

Knoxville, TN 37931

 

Re: Registration Statement on Form S-4

Ladies and Gentlemen:

We have acted as counsel to Provectus Biopharmaceuticals, Inc., a Delaware corporation (the “ Company ”), in connection with a Registration Statement on Form S-4 (the “ Registration Statement ”), filed by the Company with the U.S. Securities and Exchange Commission (the “ Commission ”) pursuant to the Securities Act of 1933, as amended (the “ Securities Act ”), relating to the issuance of: (i) up to 59,861,601 shares (the “ Shares ”) of the Company’s common stock, par value $.001 per share (the “ Common Stock ”), to be issued upon the exercise of certain of the Company’s outstanding warrants (the “ Existing Warrants ”), tendered pursuant to the Offer Letter/Prospectus contained in the Registration Statement (the “ Offer Letter/Prospectus ”); (ii) new warrants (the “ Warrants ”) to purchase up to an aggregate of 59,861,601 shares (the “ Warrant Shares ”) of Common Stock; and (iii) the Warrant Shares to be issued upon exercise of the Warrants. The Warrants, the Warrant Shares and the Shares are collectively referred to herein as the “ Securities ”. This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement, the Offer Letter/Prospectus contained therein and the Letter of Transmittal filed as an exhibit thereto, other than as expressly stated herein with respect to the issuance of the Securities.

In connection with this opinion, we have examined and relied upon the Registration Statement and the Offer Letter/Prospectus, the Company’s Certificate of Incorporation, as amended, the Company’s Bylaws, as amended, the Warrant Agency Agreement, as amended (the “ Warrant Agreement ”), by and between the Company and Broadridge Corporate Issuer Solutions, Inc. (“ Broadridge ”) (the “ Warrant Agent ”), the form of the Warrants, the Exchange and Escrow Agent Agreement, dated December 31, 2015 (the “ Exchange and Escrow Agreement ”), by and between the Company and Broadridge (in such capacities, the “ Exchange Agent ” or the “ Escrow Agent ,” as applicable), that certain Opinion Certificate dated as of the date hereof and delivered by Peter R. Culpepper, Chief Financial Officer, Chief Operating Officer and Chief Administrative Officer of the Company, and originals or copies certified to our satisfaction of such other records, documents, certificates, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinions expressed below.

ALABAMA  ●  FLORIDA  ●  GEORGIA  ●  LOUISIANA   ●  MISSISSIPPI  ●  TENNESSEE  ●  TEXAS  ●  WASHINGTON, D.C.


In our aforesaid examination, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the accuracy and completeness of all documents submitted to us, the authenticity of all original documents, and the conformity to authentic original documents of all documents submitted to us as certified, telecopied, photostatic, or reproduced copies. We have also assumed the accuracy, completeness and authenticity of the foregoing certifications of officers and statements of fact, on which we are relying, and have made no independent investigations thereof. This opinion letter is given, and all statements herein are made, in the context of the foregoing.

To the extent that the obligations of the Company under each of the Warrant Agreement and the Exchange and Escrow Agreement may be dependent upon such matters, we assume for purposes of this opinion that the Warrant Agent, the Exchange Agent and the Escrow Agent are duly organized, validly existing and in good standing under the laws of its jurisdiction of organization; that the Warrant Agent, the Exchange Agent and the Escrow Agent are duly qualified to engage in the activities contemplated by the Warrant Agreement and the Exchange and Escrow Agreement, respectively; that each of the Warrant Agreement and the Exchange and Escrow Agreement has been duly authorized, executed and delivered by the Warrant Agent, Exchange Agent and the Escrow Agent, respectively, and constitutes the legal, valid and binding obligations of the Warrant Agent, Exchange Agent and the Escrow Agent, respectively, enforceable against the Warrant Agent, Exchange Agent and the Escrow Agent, respectively, in accordance with its terms; that the Warrant Agent is in compliance, generally and with respect to acting as a warrant agent under the Warrant Agreement, the Exchange Agent is in compliance generally and with respect to acting as an exchange agent under the Exchange and Escrow Agreement and the Escrow Agent is in compliance generally and with respect to acting as an escrow agent under the Exchange and Escrow Agreement, as the case may be, with all applicable laws and regulations; and that each of the Warrant Agent, Exchange Agent and the Escrow Agent has the requisite organizational and legal power and authority to perform its obligations under the Warrant Agreement and Exchange and Escrow Agreement, respectively. Furthermore, our opinions as set forth herein assume that there are a sufficient number of shares of Common Stock authorized in connection with the issuance of the Warrant Shares.

Based upon and subject to the foregoing and the other assumptions and qualifications set forth herein, it is our opinion that as of the date hereof:

1. The Shares to be issued upon exercise of the Existing Warrants have been duly authorized, and when the Shares shall have been issued by the Company against payment therefor, will be validly issued, fully paid and nonassessable.

2. The Warrants to be issued by the Company pursuant to the Registration Statement, the Offer Letter/Prospectus contained therein, the Letter of Transmittal filed as an exhibit thereto and the Warrant Agreement have been duly authorized by all requisite corporate action and constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms.

3. The Warrant Shares to be issued upon exercise of the Warrants have been duly authorized and reserved for issuance and, upon issuance and delivery and payment therefor in accordance with the terms of the Warrant, will be validly issued, fully paid and nonassessable.

The opinions set forth in paragraph (2) above are subject to the following exceptions, limitations and qualifications: (i) the effect of bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or other similar laws now or hereafter in effect relating to or affecting the rights or remedies of creditors; (ii) the effect of general principles of equity, whether enforcement is considered in a proceeding in equity or at law, and the discretion of the court before which any proceeding therefor may

 

2


be brought; and (iii) the unenforceability under certain circumstances under law or court decisions of provisions providing for the indemnification of or contribution to a party with respect to a liability where such indemnification or contribution is contrary to public policy.

This opinion also is subject to the following qualifications:

 

  (a) Our opinions as set forth herein are limited in all respects to the federal laws of the United States of America and, to the extent applicable, the General Corporation Law of the State of Delaware. No opinion is given regarding the laws of any other jurisdiction.

 

  (b) We express no opinion with respect to the registration or qualification of the Securities under any state securities or “Blue Sky” laws.

 

  (c) This letter is strictly limited to those matters expressly addressed herein. We express no opinion as to any matter not specifically stated to be and numbered above as an opinion.

 

  (d) This letter is rendered as of the date hereof and we assume no responsibility to update this letter for any changes in applicable law occurring after the date hereof.

This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Securities Act. We consent to your filing this opinion as an exhibit to the Registration Statement, and to the reference to our firm under the heading “Legal Matters” in the Offer Letter/Prospectus constituting part of the Registration Statement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.

 

Very truly yours,
Baker, Donelson, Bearman, Caldwell & Berkowitz, a professional corporation

/s/ Lori B. Metrock

Lori B. Metrock, Shareholder

 

3

Exhibit 8.1

 

LOGO    4268 I-55 NORTH
  

MEADOWBROOK OFFICE PARK

JACKSON, MISSISSIPPI 39211

PHONE: 601.351.2400

FAX: 601.351.2424

MAILING ADDRESS:

  

P.O. BOX 14167

JACKSON, MISSISSIPPI 39236

 

www.bakerdonelson.com

J ON D. S EAWRIGHT

Direct Dial : (601) 351-8921

Direct Fax : (601) 974-8921

E-mail: jseawright@bakerdonelson.com

December 31, 2015

Board of Directors

Provectus Biopharmaceuticals, Inc.

7327 Oak Ridge Highway, Suite A

Knoxville, TN 37931

 

Re: Federal Tax Consequences of a Modification and Exercise of Certain Warrants

Ladies and Gentlemen:

We have acted as counsel to Provectus Biopharmaceuticals, Inc., a Delaware corporation (the “ Company ”), in connection with a Registration Statement on Form S-4 (the “ Registration Statement ”), filed by the Company with the U.S. Securities and Exchange Commission (the “ Commission ”) pursuant to the Securities Act of 1933, as amended (the “ Securities Act ”), relating to an offer by the Company to certain of its warrant holders to receive new warrants (the “ Replacement Warrants ”) upon the exercise of their existing warrants at a reduced strike price (the “ Offer ”). The Offer is being made to holders (the “ Holders ”) of the Company’s warrants to purchase common stock issued between January 6, 2011 and November 1, 2015 in private placement transactions (the “ Existing Warrants ”). No opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement, the Offer Letter/Prospectus contained therein (the “ Offer Letter/Prospectus ”) or the Letter of Transmittal filed as an exhibit thereto, other than as expressly stated herein with respect to the federal income tax consequences to the Company and the Holders resulting from the Offer or the election by any such Holders to tender Existing Warrants pursuant to the terms of the Offer.

In connection with this opinion, we have examined and relied upon the Registration Statement and the Offer Letter/Prospectus, and originals or copies certified to our satisfaction of such other records, documents, certificates, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinions expressed below.

In our aforesaid examination, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the accuracy and completeness of all documents submitted to us, the authenticity of all original documents, and the conformity to authentic original documents of all documents submitted to us as certified, telecopied, photostatic, or reproduced copies. We have also assumed the accuracy, completeness and authenticity of the foregoing certifications of officers and statements of fact, on which we are relying, and have made no independent investigations thereof. This opinion letter is given, and all statements herein are made, in the context of the foregoing.

Based upon and subject to the foregoing and the other assumptions and qualifications set forth herein, it is our opinion that as of the date hereof:

1. The Company should not experience any materially adverse federal income tax consequences as a result of making the Offer.

ALABAMA  ●  FLORIDA  ●  GEORGIA  ●  LOUISIANA   ●  MISSISSIPPI  ●  TENNESSEE  ●  TEXAS  ●  WASHINGTON, D.C.


2. The Company and the participating Holders have a reasonable basis for treating the Offer as (i) a material modification of the terms of the Existing Warrants to provide that each such Existing Warrant is exercisable for common stock at a reduced exercise price and a Replacement Warrant, followed by (ii) an exercise of the modified Existing Warrant.

3. The Company and the participating Holders have a reasonable basis to conclude that the modification of the Existing Warrants pursuant to the terms of the Offer will result in a deemed exchange of the “old” Existing Warrants for “new” Existing Warrants.

4. A deemed exchange of “old” Existing Warrants for “new” Existing Warrants should qualify as a tax-free recapitalization within the meaning of Section 368(a)(1)(E).

5. Any Holders that elect not to exercise their Existing Warrants pursuant to the terms of the Offer should not experience any materially adverse federal income tax consequences as a result of the Offer.

The opinions set forth in paragraphs (1) through (5) above are subject to the following exceptions, limitations and qualifications: (i) due to a lack of direct legal authority, it is uncertain whether the Internal Revenue Service (the “ IRS ”) will agree with the foregoing characterization of the Offer and the exercise of Existing Warrants, and whether, if challenged, such characterizations will be respected; and (ii) because the IRS could potentially treat one or more aspects of the Offer or the exercise of Existing Warrants in a different manner, the Offer and/or the exercise of Existing Warrants may yield additional tax obligations for the Company and/or the Holders.

This opinion letter also is subject to the following qualifications:

 

  (a) Our opinions as set forth herein are limited in all respects to the federal laws of the United States of America. No opinion is given regarding the laws of any other jurisdiction.

 

  (b) We express no opinion with respect to the tax consequences under any state or local jurisdictions.

 

  (c) This letter is strictly limited to those matters expressly addressed herein. We express no opinion as to any matter not specifically stated to be and numbered above as an opinion.

 

  (d) This letter is rendered as of the date hereof and we assume no responsibility to update this letter for any changes in applicable law occurring after the date hereof.

This opinion letter is for your benefit in connection with the consummation of the transactions set forth in the Offer Letter/Prospectus and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Securities Act. We consent to your filing this opinion as an

 

2


exhibit to the Registration Statement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.

 

Very truly yours,
Baker, Donelson, Bearman, Caldwell & Berkowitz, a professional corporation

/s/ Jon D. Seawright

Jon D. Seawright, Shareholder

 

3

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Provectus Biopharmaceuticals, Inc.

Knoxville, Tennessee

We hereby consent to the incorporation by reference in the Prospectus constituting a part of this Registration Statement of our reports dated March 12, 2015, relating to the consolidated financial statements and the effectiveness of Provectus Biopharmaceuticals, Inc.’s internal control over financial reporting appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

We also consent to the reference to us under the caption “Experts” in the Prospectus.

/s/ BDO USA, LLP

Chicago, Illinois

December 31, 2015

Exhibit 99.1

LETTER OF TRANSMITTAL

Pursuant to the Offer Dated December 31, 2015

by

Provectus Biopharmaceuticals, Inc.

THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 4:00 P.M. EASTERN TIME ON

FEBRUARY 15, 2016 UNLESS THE OFFER IS EARLIER WITHDRAWN OR EXTENDED

Delivery of this Letter of Transmittal or any other documents, securities or amounts payable for early exercise of the tendered Existing Warrants (as defined below) should be made to:

 

TO: Broadridge Corporate Issuer Solutions, Inc.

By hand or overnight courier : Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail :* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

Wire Instructions:

US Bank

ABA/Routing number: 123000848

International/Swift code: USBKUS44IMT

Bank: U.S. Bank

800 Nicollet Mall

City/State/Country: Minneapolis, MN 55402 United States

Beneficiary Account Name: Broadridge

Account Number: 153910728465

Delivery to an address other than to Broadridge Corporate Issuer Solutions (referred to as the “Depositary” or “Warrant Agent”) will not constitute valid delivery.

PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL, INCLUDING THE INSTRUCTIONS,

CAREFULLY AND MAKE SURE THAT YOU SIGN AND COMPLETE THE FORM.

Ladies and Gentlemen:

The undersigned hereby exercises the below described Existing Warrants (as defined below) of Provectus Biopharmaceuticals, Inc., a Delaware corporation (the “Company”), pursuant to the Company’s Offer Letter/Prospectus, dated December 31, 2015, and this Letter of Transmittal (which together constitute the “Offer”).

The Board of Directors of the Company has extended the Offer to holders of the Company’s outstanding unregistered warrants to purchase, at a discounted exercise price, an aggregate of 59,861,601 shares of common stock (except those holders who reside in states or other jurisdictions where an offer, solicitation or sale would be unlawful), which were issued between January 6, 2011 and November 1, 2015 in transactions exempt from registration under the Securities Act of 1933, as amended (the “Existing Warrants”). Such Existing Warrant holders have the opportunity to receive, upon the exercise of such Existing Warrants, new warrants to


purchase the same number of shares of the Company’s common stock, $0.001 par value per share (the “Common Stock”), at an exercise price of $0.85 per share that will expire June 19, 2020 (the “Replacement Warrants”).

The Offer is to temporarily modify the terms of the Existing Warrants so that during the Offer Period (as defined in the Offer Letter/Prospectus), each Warrant holder who tenders Existing Warrants for early exercise (i) may exercise such Existing Warrants at a discounted exercise price of $0.75 per share and (ii) will receive, in addition to the shares of Common Stock purchased upon such exercise of the Existing Warrants, new Replacement Warrants with an exercise price of $0.85 per share.

A holder may tender as few or as many Existing Warrants as the holder elects. The modified Warrant terms are only valid during the Offer Period. The Company will not pay interest on cash tendered for the exercise price of the Existing Warrants regardless of any withdrawal of tendered Existing Warrants during the Offer Period, extension of, or amendment to, the Offer.

EXISTING WARRANTS WHICH ARE NOT TENDERED, OR WHICH ARE TENDERED AND WITHDRAWN IN ACCORDANCE WITH THE PROCEDURES HEREIN, WILL RETAIN THEIR CURRENT TERMS. THE EXISTING WARRANTS HAVE EXERCISE PRICES OF BETWEEN $1.00 AND $3.00 PER SHARE AND EXPIRE BETWEEN JANUARY 6, 2016 AND NOVEMBER 1, 2020.

Subject to and effective upon acceptance for exercise of the Existing Warrants submitted with this Letter of Transmittal in accordance with the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of such extension or amendment), the undersigned hereby tenders Existing Warrants for early exercise as indicated in Box 1 of this Letter of Transmittal, with the understanding that the Company will issue the undersigned both the number of shares of Common Stock purchased as a result of the Warrant exercise and the Replacement Warrants to purchase an equal number of shares of Common Stock.

Upon the terms and subject to the conditions of the Offer, the Company will accept for exercise Existing Warrants validly tendered. In all cases, Existing Warrants will only be accepted for exercise pursuant to the Offer after timely receipt by the Depositary of certificates for Existing Warrants, a properly completed and duly executed Letter of Transmittal or manually signed photocopy thereof, and a certified bank check or wire transfer of immediately available funds in accordance with the amount of the purchase price of the Common Stock being acquired upon exercise of the Existing Warrants tendered, payable to the Depositary.

The undersigned acknowledges that he, she or it has been advised to consult with their own advisors as to the consequences of participating or not participating in the Offer.

The undersigned hereby represents and warrants to the Company that:

(a) the undersigned has full power and authority to tender and purchase all of the Common Stock of the Company which may be received upon exercise of the tendered Existing Warrants pursuant to their exercise;

(b) he, she or it has good, marketable and unencumbered title to the tendered Existing Warrants, free and clear of all security interests, liens, restrictions, charges, encumbrances, conditional sales agreements or other obligations relating to their exercise, sale or transfer, and not subject to any adverse claim;

(c) on request, the undersigned will execute and deliver any additional documents the Company deems necessary to complete the exercise of the Existing Warrants tendered hereby;

(d) the undersigned understands that tenders of Existing Warrants pursuant to the Offer and in the instructions hereto will constitute the undersigned’s acceptance of the terms and conditions of the Offer; and

(e) the undersigned agrees to all of the terms of the Offer.


All authorities conferred or agreed to be conferred in this Letter of Transmittal shall survive the death or incapacity of the undersigned, and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, executors, administrators, successors, assigns, trustees in bankruptcy, and legal representatives of the undersigned. Except as stated in the Offer, this tender is irrevocable.

The undersigned hereby: (i) elects to exercise the Existing Warrants described under “Election to Exercise Existing Warrants” below (Box 1); and (ii) agrees to purchase the Common Stock issuable thereunder and is submitting the applicable discounted exercise price (payable to the Depositary by certified check or wire amount), pursuant to the terms and subject to the conditions described in the Offer Letter/Prospectus and this Letter of Transmittal. The undersigned is the registered owner of all such Existing Warrants. Subject to, and effective upon, the Company’s acceptance of the undersigned’s election to exercise the Existing Warrants described in Box 1 below and the Company’s receipt of available funds equal to the amount of the applicable discounted exercise price, the undersigned hereby assigns and transfers to, or upon the order of, the Company, all right, title and interest in, to, and under the Existing Warrants being exercised hereby, waives any and all other rights with respect to such Existing Warrants and releases and discharges the Company from any and all claims the undersigned may have now, or may have in the future, arising out of, or related to, such Existing Warrants.

The undersigned hereby irrevocably constitutes and appoints the Warrant Agent as the true and lawful agent and attorney-in-fact of the undersigned with respect to the Existing Warrants the undersigned is electing to tender for early exercise, with full power of substitution (the power of attorney being deemed to be an irrevocable power coupled with an interest), to: (i) deliver the Existing Warrants the undersigned is electing to tender for early exercise (together with any applicable discounted exercise price being tendered herewith) to the Company or cause ownership of such Existing Warrants to be transferred to, or upon the order of, the Company on the books of the Warrant Agent and deliver all accompanying evidences of transfer and authenticity to, or upon the order of, the Company upon receipt by the Company’s Warrant Agent, as the undersigned’s agent, of the Common Stock to which the undersigned is entitled upon acceptance by the Company of the undersigned’s election to exercise Existing Warrants pursuant to the Offer; and (ii) receive all benefits and otherwise exercise all rights of beneficial ownership of the exercised Existing Warrants all in accordance with the terms and subject to the conditions of the Offer described in the Offer Letter/Prospectus.

Unless otherwise indicated under “Special Issuance Instructions” below (Box 4), please issue the Common Stock for the exercised Existing Warrants and the Replacement Warrants in the name(s) of the undersigned. Similarly, unless otherwise indicated under “Special Delivery Instructions” below (Box 5), please send or cause to be sent the certificates for the Common Stock and the Replacement Warrants (and accompanying documents, as appropriate) to the undersigned at the address shown below under “Issuance Instructions” below (Box 3) or provide the name of the account with the Warrant Agent or at The Depositary Trust Company to which the Common Stock and the Replacement Warrants should be issued.

The undersigned understands that elections to exercise Existing Warrants pursuant to the procedures described in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—General Terms” and in the instructions to this Letter of Transmittal will constitute a binding agreement between the undersigned and the Company upon the terms of the Offer set forth in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—General Terms,” and subject to the conditions of the Offer set forth in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—Extension of Offer Period; Termination; Amendments; Conditions,” subject only to withdrawal of elections to exercise on the terms set forth in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—Withdrawal Rights.”

“Expiration Time” means 4:00 p.m., Eastern Time, on February 15, 2016, unless and until the Company, in its sole discretion, withdraws or extends the Offer, in which case the “Expiration Time” means the latest time and date at which the Offer, as withdrawn or extended, expires.


NOTE: SIGNATURES MUST BE PROVIDED BELOW

PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

BEFORE COMPLETING THE BOXES.

Delivery of this Letter of Transmittal or any other documents, securities or amounts payable for early exercise of the tendered Existing Warrants to an address, or transmission of instructions to a facsimile number, other than as set forth above, does not constitute a valid delivery. Please read carefully the entire Letter of Transmittal, including the accompanying instructions, before completing any box below. This Letter of Transmittal is to be used only if certificates are to be forwarded herewith (or such certificates will be delivered pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary).

If you desire to tender Existing Warrants pursuant to the Offer and you cannot deliver your Warrant and all other documents and amounts payable required by this Letter of Transmittal are delivered to the Depositary prior to the Expiration Time, you may tender your Existing Warrants according to the guaranteed delivery procedures set forth in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—Procedure for Exercising and Tendering Existing Warrants.”

Delivery of documents to the Company does not constitute delivery to the Depositary.

BOX 1: ELECTION TO EXERCISE EXISTING WARRANTS

Please list the Existing Warrant certificates you elect to exercise:

 

   

Existing

Warrant Certificate

Numbers (#)

     

Number of Existing
Warrants Represented by

Warrant Certificate (#)

     

Number of Existing

Warrants Being

Exercised (#)

   
                 

1)

                 

2)

                 

3)

                 

4)

                 

 

TOTAL NUMBER OF EXISTING WARRANTS   
EXERCISED:    

 

     

BOX 2: CALCULATION OF EXERCISE PRICE

Please calculate the discounted exercise price of the Existing Warrants you elect to exercise:

 

       

Total Number

of Existing

Warrants

Being

  Exercised (#)  

             

Aggregate

Discounted

  Exercise Price  

($)

       
                   
          multiplied by .75 =          

The aggregate discounted exercise price above is the total amount that you are required pay to the Depository by certified bank check or wire transfer of immediately available funds.


BOX 3: ISSUANCE INSTRUCTIONS

Please issue the certificates of Provectus Biopharmaceuticals, Inc. Common Stock issuable upon the exercise of the Existing Warrants listed in Box 1 above and the certificates representing the Replacement Warrants to which the undersigned is entitled pursuant to the terms of the Offer to the undersigned as set forth below:

 

 Issue Certificate(s) to:                               (Please Print) 
                       
 Name:                    
     
   
 Address:                    
     
   
     
   
 City:           State:               Postal Zip Code:          
   
 Social Security Number/Federal Tax Identification:              
                                         

BOX 4: SPECIAL ISSUANCE INSTRUCTIONS

Fill in this section ONLY if certificate(s) of Provectus Biopharmaceuticals, Inc. Common Stock and Replacement Warrant certificates are to be issued in a name OTHER than that of the undersigned whose name appears in Box 3 ABOVE.

 

 Issue Certificate(s) to:                               (Please Print) 
                       
 Name:                    
     
   
 Address:                    
     
   
     
   
 City:           State:               Postal Zip Code:          
   
 Social Security Number/Federal Tax Identification:              
                                         

BOX 5: SPECIAL DELIVERY INSTRUCTIONS

Fill in this section ONLY if certificate(s) of Provectus Biopharmaceuticals, Inc. Common Stock and Replacement Warrant certificates are to be mailed to someone OTHER than the undersigned whose name appears in Box 3 ABOVE, or to the owner at an address other than that shown in Box 4 ABOVE.

 

 Mail Certificate(s) to:                           (Please Print)    
                       
 Name:                    
     
   
 Address:                    
     
   
     
   
 City:           State:               Postal Zip Code:          
   
 Social Security Number/Federal Tax Identification:              
                                         


BOX 6: EXERCISING HOLDER SIGNATURE

Note: The registered owner of the Existing Warrants must complete this section. The registered owner of the Existing Warrants must provide a signature below as his, her or its name appears on the Existing Warrants, or a signature must be provided by person(s) authorized to become registered owner(s) (evidence of which authorization must be transmitted with this Letter of Transmittal). If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer, or other person acting in a fiduciary or representative capacity, that person must set forth his, her or its full title below and submit evidence to the Depositary of such person’s authority to act. See Instruction 7.

 

Name(s) of Registered Owner(s) (Please Print):  

 

   

 

 

 

 

   

 

Signature(s) of Registered Owner(s):  

 

   

 

 

 

 

   

 

Dated:      

 

 

 

Telephone Number:        

 

 

 

If the signature provided above is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, please provide the following information:

 

Name(s) of Person(s) Signing:      
Capacity of Person(s) Signing:      
Address:      
Telephone Number:      
Tax Identification or Social Security Number:      

Guarantee of Signature (If required by Instruction 8)

 

Authorized Signature:      
Name:      
Title:      
Name of Firm:      
  (Must be an Eligible Institution as defined in Instruction 8)
Address:      
Telephone Number:      
Dated:      


BOX 7: REPRESENTATION REGARDING OWNED SECURITIES

Please indicate by checkmark all types of securities of the Company owned by the registered owner of the Existing Warrants (other than Existing Warrants tendered for early exercise herewith). If the registered owner of the Existing Warrants does not hold any securities of the Company other than the Existing Warrants tendered for early exercise herewith, check “None.”

 

Common Stock   ¨   None               ¨  

Existing Warrants for Common    

Stock

  ¨      

[Instructions follow.]


INSTRUCTIONS

FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER

1. Execution and Delivery. This Letter of Transmittal must be properly completed, dated and signed by the registered owner(s) of the Warrant certificate(s) transmitted herewith and mailed or delivered with such Warrant certificate(s) to the Depositary at the following address:

 

TO: Broadridge Corporate Issuer Solutions, Inc.

By hand or overnight courier : Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail :* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

THE METHOD OF DELIVERY OF ALL DOCUMENTS IS AT THE OPTION AND RISK OF THE WARRANT HOLDER, BUT IF DELIVERY IS BY MAIL TO THE ABOVE ADDRESS, REGISTERED OR INSURED MAIL IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.

Questions and requests for assistance or additional copies of the Letter of Transmittal should be directed to Broadridge Corporate Issuer Solutions at the address indicated above.

Questions and requests for assistance or additional information regarding the Offer should be directed to the attention of Peter R. Culpepper at Provectus Biopharmaceuticals, Inc., via mail at 7327 Oak Ridge Hwy., Suite A, Knoxville, Tennessee 37931; telephone number (866) 594-5999; or e-mail at pete@pvct.com, or to the attention of Summer Kotb at Maxim Group LLC, via mail at 405 Lexington Avenue, 2nd Floor, New York, New York 10174; telephone number (212) 895-3511; or e-mail at skotb@maximgrp.com.

2. Delivery of Letter of Transmittal and Warrant Certificates. This Letter of Transmittal is to be used by registered Warrant holders to exercise the Existing Warrants pursuant to this Offer. To exercise the Warrant, the following documents should be mailed or delivered to the Depositary at the address set forth in Instruction 1 and must be received by the Depositary prior to the expiration of the Offer:

(a) a properly completed and duly executed Letter of Transmittal or photocopy/facsimile thereof, with any required signature guarantees;

(b) certificates for the Existing Warrants being exercised;

(c) discounted payment for the early exercise of the tendered Existing Warrants; and

(d) any other documents required by the Letter of Transmittal.

If Warrant certificates are forwarded to the Depositary in multiple deliveries, a properly completed and duly executed Letter of Transmittal must accompany each such delivery.


3. Guaranteed Delivery Procedures. If a registered owner of Existing Warrants wants to exercise his, her or its Existing Warrants pursuant to the Offer, but the Warrant certificates are not immediately available or time will not permit all required documents to reach the depositary prior to the Expiration Time, Warrant holders can still tender their Existing Warrants pursuant to the guaranteed delivery procedure set forth in the Offer Letter/Prospectus, which requires the following:

(a) the tender must be made by or through an “Eligible Institution” (as defined in Instruction 8);

(b) the Depositary must receive by hand, mail, overnight courier or facsimile transmission, prior to the expiration of the Offer Period, a properly completed and duly executed Notice of Guaranteed Delivery in the form the Company has provided with this document, with signatures guaranteed by an Eligible Institution, accompanied by proper payment for the early exercise of tendered Existing Warrants; and

(c) the Depositary must receive, within three (3) NYSE MKT trading days after the date of its receipt of the Notice of Guaranteed Delivery, as provided in the Offer Letter/Prospectus:

(i) the certificates for all tendered Existing Warrants, and

(ii) a properly completed and duly executed Letter of Transmittal or photocopy/facsimile thereof, and

(iii) any other required documents.

Except as specifically permitted by the Offer Letter/Prospectus, no alternative or contingent exercises will be accepted.

4. Inadequate Space. If the space provided in Box 1 “Election to Exercise Existing Warrants” is inadequate, the Warrant certificate numbers, numbers of shares and number of shares being exercised should be listed on a separate, signed schedule and attached to the Letter of Transmittal.

5. Existing Warrants Exercised . Warrant holders who choose to participate in the Offer may exercise some or all of such holder’s Existing Warrants pursuant to the terms of the Offer.

6. Special Issuance and Special Delivery Instructions (Boxes 4 and 5). Indicate the name and address to which the new common stock certificate(s) and Replacement Warrant certificate(s) are to be sent, if different from the name and address of the person(s) signing this Letter of Transmittal. If either of these boxes are completed, your Letter of Transmittal must be guaranteed by an Eligible Institution in the “Guarantee of Signature” portion of Box 6. See Instruction 8 below.

7. Signatures on Letter of Transmittal, Stock Powers and Endorsements. If this Letter of Transmittal is signed by the registered owner(s) of the Warrant certificate(s) transmitted herewith, the signature(s) must correspond with the name(s) as written on the face of the Warrant certificate(s) without alteration, enlargement or any change whatsoever.

If the transmitted Warrant certificate(s) are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal.

If any tendered Existing Warrants are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal (or photocopies/facsimiles thereof) as there are different registrations of certificates.

If this Letter of Transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or any other individual acting in a fiduciary or representative capacity on behalf of the registered


owner, such person should so indicate when signing, and proper evidence of their authority so to act must be submitted to the Depositary along with this Letter of Transmittal.

When this Letter of Transmittal is signed by the registered owner(s) of the Warrant certificate(s) transmitted herewith, no endorsements of Warrant certificate(s) or separate stock power(s) are required.

If this Letter of Transmittal is signed by a person other than the registered owner(s) of the Warrant certificates listed in Box 1, or if the shares of Provectus Biopharmaceuticals, Inc. Common Stock to be issued upon exercise of the tendered Existing Warrants and the Replacement Warrants are to be issued in a name or mailed to an address other than the registered owner(s) of the Warrant certificate(s) transmitted herewith, the Warrant certificate(s) must be properly endorsed or accompanied by appropriate stock power(s), in either case signed EXACTLY AS THE NAME(S) of the registered owner(s) appears on the Warrant certificate(s). Signatures on Warrant certificate(s) or separate stock power(s) required by this paragraph must be guaranteed by an Eligible Institution in the “Guarantee of Signature” portion of Box 6. See Instruction 8 below.

If the Warrant certificate(s) or stock power(s) are signed by trustees, executors, administrators, guardians, attorney-in-facts, officers of a corporation or others acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence of their authority so to act must be submitted to the Depositary along with this Letter of Transmittal.

8. Guarantee of Signatures on Letter of Transmittal or Certificates. No signature guarantee is required if:

(a) this Letter of Transmittal is signed by the registered owner of the Existing Warrants exactly as the name of the registered owner appears on the certificate tendered with this Letter of Transmittal and such owner has not completed the box entitled “Special Delivery Instructions” or “Special Issuance Instructions”; or

(b) such Existing Warrants are tendered for the account of a member firm of a registered national securities exchange, a member of the Financial Industry Regulatory Authority, Inc. or a commercial bank or trust company (not a savings bank or savings and loan association) having an office, branch or agency in the United States which is a participant in an approval Signature Guarantee Medallion Program (each such entity, an “Eligible Institution”); or

(c) the holders of such Existing Warrants reside outside of the U.S. and are not otherwise tendering the Existing Warrants in the U.S.

In all other cases, an Eligible Institution must guarantee all signatures on this Letter of Transmittal.

9. Lost Warrant Certificate(s) . Please contact the Depositary at TO: Broadridge Corporate Issuer Solutions, Inc.

By hand or overnight courier: Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail:* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

if you cannot locate your Warrant certificate(s).

10. Irregularities. All questions as to the number of Existing Warrants to be accepted, the validity, form, eligibility (including time of receipt) and acceptance for exercise of any tender of Existing Warrants will be determined by the Company in its sole discretion, which determinations shall be final and binding on all parties,


subject to the judgments of any courts. The Company reserves the absolute right to reject any or all tenders of Existing Warrants it determines not to be in proper form or to reject those Existing Warrants, the acceptance of which may, in the opinion of the Company’s counsel, be unlawful, subject to the judgments of any court. The Company also reserves the absolute right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular Existing Warrants, and the Company’s interpretation of the terms of the Offer (including these instructions) will be final and binding on all parties, subject to the judgments of any court with jurisdiction over the Company. No tender of Existing Warrants will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as the Company shall determine. Neither the Company nor any other person is or will be obligated to give notice of any defects or irregularities in tenders and none of them will incur any liability for failure to give any such notice.

IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A PHOTOCOPY THEREOF) TOGETHER WITH WARRANT CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY ON OR PRIOR TO THE EXPIRATION TIME.

Exhibit 99.2

NOTICE OF GUARANTEED DELIVERY

of Warrants of

Provectus Biopharmaceuticals, Inc.

Pursuant to the Offer dated December 31, 2015

This Notice of Guaranteed Delivery, or one substantially in the form hereof, must be used to accept the Offer (as defined below) if:

 

    Warrants are not immediately available or Warrant holders cannot deliver Warrants to Broadridge Corporate Issuer Solutions (the “Depositary”) prior to the Expiration Time; or

 

    Time will not permit all required documents, including a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile of the Letter of Transmittal) and any other required documents, to reach the Depositary prior to the Expiration Time.

“Expiration Time” means 4:00 p.m., Eastern Time, on February 15, 2016, unless and until the Company, in its sole discretion, withdraws or extends the Offer, in which case the “Expiration Time” means the latest time and date at which the Offer, as withdrawn or extended, expires.

The Offer Letter/Prospectus and the related Letter of Transmittal, as amended or supplemented from time to time, together constitute the “Offer.”

 

TO: BROADRIDGE CORPORATE ISSUER SOLUTIONS

By hand or overnight courier : Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail :* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

This Notice of Guaranteed Delivery, properly completed and duly executed, may be delivered by hand, mail, overnight courier or facsimile transmission to the Depositary, as described in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—Procedure for Exercising and Tendering Existing Warrants.” The method of delivery of all required documents is at your option and risk. If delivery is by mail, it is recommended that you use registered mail with return receipt requested (properly insured).

For this notice to be validly delivered, it must be received by the Depositary at the above address before the Offer expires and be accompanied by a certified bank check or wire transfer of immediately available funds in accordance with the amount of the purchase price of the common stock being acquired upon exercise of the Warrants tendered, payable to the Depositary. Delivery of this notice to another address will not constitute a valid delivery. Delivery to the Company will not be forwarded to the Depositary and will not constitute a valid delivery.

Your signature on this Notice of Guaranteed delivery must be guaranteed by an “Eligible Institution,” and the Eligible Institution must also execute the Guarantee of Delivery attached hereto. An “Eligible Institution” is a bank, broker dealer, credit union, savings association or other entity that is a member in good standing of the Securities Transfer Agents Medallion Program or a bank, broker, dealer, credit union, savings association or other entity which is an “eligible guarantor institution,” as that term is defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended. In addition, if the instructions to the Letter of Transmittal require a signature on a Letter of Transmittal to be guaranteed by an Eligible Institution, such signature guarantee must appear in the applicable space provided in the signature box on the Letter of Transmittal.


By signing this Notice of Guaranteed Delivery, you exercise, upon the terms and subject to the conditions described in the Offer Letter/Prospectus and the related Letter of Transmittal, receipt of which you hereby acknowledge, the number of Warrants specified below pursuant to the guaranteed delivery procedure described in the section of the Offer Letter/Prospectus entitled “The Exchange Offer—Procedure for Exercising and Tendering Existing Warrants.”

Please list the Warrant certificates you elect to exercise.

 

Certificate Numbers      

Number of Warrants

Represented by Certificate

     

Number of Warrants

Being Exercised

 

   

 

   

 

             
             
             

 

TOTAL WARRANTS EXERCISED:            

 

 

 

 

SIGNATURES

 

 

Signature(s) of Warrant Holder(s)

 

 

Name(s) of Warrant Holder(s) (Please Print)

 

 

Address

 

 

City, State Zip

 

 

Telephone Number

 

 

Date


GUARANTEE OF SIGNATURES

 

 

Authorized Signature

 

 

Name

 

 

Title

 

 

Name of Firm (must be an Eligible Institution as defined in this Notice of Guaranteed Delivery)

 

 

Address

 

 

Telephone Number

 

 

Dated


GUARANTEE OF DELIVERY

(Not to be used for signature guarantee)

The undersigned, a bank, broker dealer, credit union, savings association or other entity that is a member in good standing of the Securities Transfer Agents Medallion Program or a bank, broker, dealer, credit union, savings association or other entity which is an “eligible guarantor institution,” as that term is defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended (each of the foregoing constituting an “Eligible Institution”), guarantees delivery to the Depositary of the Warrants tendered, in proper form for transfer, together with a properly completed and duly executed Letter(s) of Transmittal (or a facsimile(s) thereof), and any other required documents, all within three (3) Pink Sheets trading days after the date of receipt by the Depositary of this Notice of Guaranteed Delivery.

The Eligible Institution that completes this form must communicate the guarantee to the Depositary and must deliver the Letter of Transmittal and certificates for Warrants to the Depositary, within the time set forth above. Failure to do so could result in a financial loss to such Eligible Institution.

 

 

Name of Firm

 

 

Authorized Signature

 

 

Name (Please Print)

 

 

Title

 

 

Address

 

 

City, State Zip

 

 

Telephone Number

 

 

Date

 

 

NOTE: DO NOT SEND WARRANTS WITH THIS FORM. WARRANTS SHOULD BE SENT WITH THE LETTER OF TRANSMITTAL.

Exhibit 99.3

 

LOGO

December 31, 2015

 

To: Provectus Warrant Holders

 

RE: Warrant Exercise and Warrant Replacement Offering

Provectus Biopharmaceuticals, Inc. is offering to certain of its warrant holders a limited-time opportunity to exercise their existing warrants, which are exercisable between $1.00 and $3.00 per share at a discounted exercise price of $0.75 per share, and receive, in addition to the common stock issued as a result of the warrant exercise, a new warrant expiring on June 19, 2020. These “replacement warrants” will be exercisable at $0.85 per share. A summary of the offer is provided beginning on page 1 of the enclosed Offer Letter/Prospectus.

We urge you to review details of this offering and follow the instructions described in the enclosed Offer Letter/Prospectus and the instructions from your brokerage firm if you are interested in taking advantage of this opportunity. Your prompt attention is requested. Although the offer is currently scheduled to expire at 4:00 p.m. Eastern Time on February 15, 2016, your broker may have an earlier cut-off time for receipt of instructions.

If you have any questions concerning the offer, please contact your broker, or contact us at (866) 594-5999 for assistance. Questions and requests for assistance or additional copies of the Letter of Transmittal or Notice of Guaranteed Delivery should be directed to Broadridge Corporate Issuer Solutions at:

By hand or overnight courier : Broadridge, Inc., Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717

By mail :* Broadridge, Inc., Attn: BCIS Re-Organization Dept., P.O. Box 1317, Brentwood, New York 11717-0693

* If your chosen delivery method is USPS Priority Mail or USPS Registered Mail, you must utilize the overnight courier address.

Sincerely,

 

LOGO

Peter R. Culpepper

Chief Financial Officer