SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 18, 2020
VENUS CONCEPT INC.
(Exact name of registrant as specified in its charter)
(State or other jurisdiction
235 Yorkland Blvd, Suite 900
Toronto, Ontario M2J 4Y8
(Address of principal executive offices, including Zip Code)
Registrants telephone number, including area code (877) 848-8430
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange
on which registered
|Common Stock, $0.0001 par value per share||VERO||The Nasdaq Global Market|
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Entry into a Material Definitive Agreement.
On March 18, 2020, Venus Concept, Inc. (the Company) entered into a securities purchase agreement (the Securities Purchase Agreement) with certain investors named therein (collectively, the Investors) pursuant to which the Company will issue and sell to the Investors an aggregate of 2,300,000 shares (the Shares) of common stock, par value $0.0001 per share (the Common Stock), 660,000 shares of Series A Convertible Preferred Stock, par value $0.0001 per share (the Series A Preferred Stock), which is convertible into 6,600,000 shares of Common Stock (the Conversion Shares), and warrants (the Warrants) to purchase up to 6,675,000 shares of Common Stock (the Warrant Shares) with an exercise price of $3.50 per share (the Private Placement), subject to adjustments as provided under the terms of the Warrants. The Warrants have a five-year term and are exercisable beginning 181 days after their issue date. The Series A Preferred Stock will automatically convert into shares of Common Stock upon receipt of stockholder approval. The Series A Preferred Stock has no voting rights other than as required by law.
The closing of the Private Placement is subject to certain conditions and is expected to occur on or before March 20, 2020. The gross proceeds to the Company from the Private Placement are expected to be $22.25 million, before placement agent fees and other offering expenses. Proceeds from the Private Placement will be used to for general corporate purposes.
The Securities Purchase Agreement contains customary representations, warranties and agreements by the Company, indemnification obligations of the Company, including for liabilities under the Securities Act of 1933, as amended (the Securities Act), and other obligations of the parties. The representations, warranties, and covenants contained in the Securities Purchase Agreement were made only for purposes of such agreement and are made as of specific dates; are solely for the benefit of the parties (except as specifically set forth therein); may be subject to qualifications and limitations agreed upon by the parties in connection with negotiating the terms of the Securities Purchase Agreement, including being qualified by confidential disclosures made for the purpose of allocating contractual risk between the parties, instead of establishing matters as facts; and may be subject to standards of materiality and knowledge applicable to the contracting parties that differ from those applicable to the investors generally. Investors should not rely on the representations, warranties, and covenants or any description thereof as characterizations of the actual state of facts or condition of the Company.
The securities issued by the Company pursuant to the Securities Purchase Agreement and to be issued upon conversion of the shares of Series A Preferred Stock and the exercise of the Warrants have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Company relied and will rely on the private placement exemption from registration provided by Section 4(a)(2) of the Securities Act and by Rule 506 of Registration D, promulgated by the SEC, and on similar exemptions under applicable state laws.
Pursuant to the terms of the Securities Purchase Agreement, the Company entered into a registration rights agreement (the Registration Rights Agreement) with the Investors pursuant to which the Company is required, among other things, to file a shelf registration statement with respect to the Shares, the Conversion Shares and the Warrant Shares held by such Investors with the U.S. Securities and Exchange Commission (the SEC) within 30 days following the closing of the Private Placement. The Registration Rights Agreement contains customary terms and conditions for a transaction of this type.
The foregoing description of the Securities Purchase Agreement, the Series A Preferred Stock, the Warrants and the Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Securities Purchase Agreement, the form of Warrant and the Registration Rights Agreement, each of which will be filed as an exhibit to the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and the Certificate of Designation for the Series A Preferred Stock filed herewith as Exhibit 3.1.
Unregistered Sales of Equity Securities.
The information contained in Items 1.01 and 5.03 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
Amendment to Articles of Incorporation of Company or Bylaws; Change in Fiscal Year
On March 18, 2020, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of the Series A Convertible Preferred Stock with the Secretary of State of the State of Delaware (the Certificate of Designation) creating a new series of authorized preferred stock of the Company designated as the Series A Convertible Preferred Stock. The Certificate of Designation became effective with the Secretary of State of the State of Delaware upon filing.
The number of shares of Series A Preferred Stock designated shall be up to 660,000. No dividends will be paid on the outstanding shares of Series A Preferred Stock. Except as otherwise required by law, the Series A Preferred Stock does not have voting rights. However, as long as any shares of Series A Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series A Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series A Preferred Stock or alter or amend the Certificate of Designation, (b) amend its amended and restated certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders of Series A Preferred Stock, (c) increase the number of authorized shares of Series A Preferred Stock, or (d) enter into any agreement with respect to any of the foregoing. The Series A Preferred Stock does not have a preference upon any liquidation, dissolution or winding-
up of the Company. Pursuant to the terms of the Certificate of Designation, the Company is not permitted to issue any shares of Common Stock upon conversion of the Series A Preferred Stock to the extent that the issuance of such shares of Common Stock would exceed 19.99% of the Companys outstanding shares of Common Stock as of the date of the initial issuance of the Series A Preferred Stock, unless the Company obtains shareholder approval to issue more than such 19.99% (the Conversion Cap). The Conversion Cap will be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction. The Series A Preferred Stock is automatically convertible into shares of Common Stock, based on an initial conversion ratio of 1:10, as adjusted in accordance with the Certificate of Designation, upon receipt of the approval of the Companys stockholders.
The foregoing description of the Certificate of Designation does not purport to be complete and is qualified in its entirety by reference to the full text of the Certificate of Designation which is filed herewith as Exhibit 3.1 and is incorporated herein by reference.
On March 18, 2020, the Company issued a press release regarding the Private Placement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Financial Statements and Exhibits.
|3.1||Certificate of Designation of Series A Convertible Preferred Stock|
|99.1||Press Release dated March 18, 2020.|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|VENUS CONCEPT INC.|
|By:||/s/ Domenic Della Penna|
|Domenic Della Penna|
|Chief Financial Officer|
Date: March 18, 2020
VENUS CONCEPT INC.
CERTIFICATE OF DESIGNATION OF PREFERENCES,
RIGHTS AND LIMITATIONS
PURSUANT TO SECTION 151 OF THE DELAWARE GENERAL CORPORATION LAW
The undersigned, Domenic Serafino and Domenic DiSisto do hereby certify that:
They are the Chief Executive Officer and the General Counsel and Corporate Secretary, respectively, of Venus Concept Inc., a Delaware corporation (the Corporation).
The Corporation is authorized to issue 10,000,000 shares of preferred stock, none of which have heretofore been issued.
The following resolutions were duly adopted by the board of directors of the Corporation (the Board of Directors):
WHEREAS, the amended and restated certificate of incorporation of the Corporation provides for a class of its authorized stock known as preferred stock, consisting of 10,000,000 shares, $0.0001 par value per share (the Preferred Stock), issuable from time to time in one or more series;
WHEREAS, the Board of Directors is authorized by the amended and restate certificate of incorporation to fix the dividend rights, dividend rate, voting rights, conversion rights, rights and terms of redemption and liquidation preferences of any wholly unissued series of preferred stock and the number of shares constituting any series and the designation thereof, of any of them; and
WHEREAS, it is the desire of the Board of Directors, pursuant to its authority as aforesaid, to fix the rights, preferences, restrictions and other matters relating to a series of the preferred stock, which shall consist of up to 660,000 shares of Preferred Stock to be designated as Series A Convertible Preferred Stock which the Corporation has the authority to issue, as follows:
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby provide for the issuance of a series of Preferred Stock for cash and does hereby fix and determine the rights, preferences, restrictions and other matters relating to such series of Preferred Stock as follows:
TERMS OF SERIES A CONVERTIBLE PREFERRED STOCK
Section 1. Definitions. For the purposes hereof, the following terms shall have the following meanings:
Affiliate means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 of the Securities Act.
Commission means the United States Securities and Exchange Commission.
Common Stock means the Corporations common stock, par value $0.0001 per share, and stock of any other class of securities into which such securities may hereafter be reclassified or changed.
Conversion Cap shall have the meaning set forth in Section 6(v).
Conversion Date shall have the meaning set forth in Section 6(a).
Conversion Ratio means the ratio at which each share of Series A Preferred Stock shall convert, without the payment of additional consideration by the Holder, into Common Stock; the initial Conversion Ratio shall be 1.0 to 10.0, subject to adjustment herein.
Conversion Shares means, collectively, the shares of Common Stock issuable upon conversion of the shares of Series A Preferred Stock in accordance with the terms hereof.
Exchange Act means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
Holder shall have the meaning given such term in Section 2.
Liquidation shall have the meaning set forth in Section 5.
Original Issue Date means the date of the first issuance of any shares of Series A Preferred Stock regardless of the number of transfers of any particular shares of Series A Preferred Stock and regardless of the number of certificates which may be issued to evidence such shares of Series A Preferred Stock.
Person means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
Preferred Stock shall have the meaning set forth in the Preamble.
Shareholder Approval means such approval as required by the applicable Nasdaq Stock Market Rules by the stockholders of the Corporation with respect to the conversion of all shares of Series A Preferred Stock and the issuance of the shares of Common Stock issuable upon conversion of the Series A Preferred Stock.
Securities Act means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
Series A Preferred Stock shall have the meaning set forth in Section 2.
Trading Day means a day on which the principal Trading Market is open for business.
Trading Market means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE
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American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).
Transfer Agent means Computershare Inc., the current transfer agent of the Corporation with a mailing address of 150 Royall Street, Canton, MA 02021, and any successor transfer agent of the Corporation.
Section 2. Designation, Amount and Par Value. The series of preferred stock shall be designated as Series A Convertible Preferred Stock (the Series A Preferred Stock) and the number of shares so designated shall be up to 660,000 (which shall not be subject to increase without the written consent of Holders (each, a Holder and collectively, the Holders) of a majority of the then outstanding shares of the Series A Preferred Stock). Each share of Series A Preferred Stock shall have a par value of $0.0001 per share. The Series A Preferred Stock will initially be issued in certificated form. As between the Corporation and a beneficial owner of Series A Preferred Stock, such beneficial owner of Series A Preferred Stock shall have all of the rights and privileges of a Holder hereunder.
Section 3. Dividends. No dividends shall be paid on the outstanding shares of Series A Preferred Stock.
Section 4. Voting Rights. Except as otherwise provided herein or as otherwise required by the Delaware General Corporation Law, the Series A Preferred Stock shall have no voting rights. However, as long as any shares of Series A Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the Holders of a majority of the then outstanding shares of Series A Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series A Preferred Stock or alter or amend this Certificate of Designation, (b) amend its amended and restated certificate of incorporation or other charter documents in any manner that adversely affects any rights of the Holders, (c) increase the number of authorized shares of Series A Preferred Stock, or (d) enter into any agreement with respect to any of the foregoing. Shares of Common Stock acquired upon the conversion of shares of Series A Preferred Stock shall be entitled to the same voting rights as the shares of Common Stock.
Section 5. Liquidation. Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary (a Liquidation), the Holders shall be entitled to receive out of the assets, whether capital or surplus, of the Corporation the same amount that a holder of Common Stock would receive if the shares of Series A Preferred Stock were fully converted to Common Stock, which amounts shall be paid pari passu with all holders of Common Stock. The Corporation shall mail written notice of any such Liquidation, not less than 45 days prior to the payment date stated therein, to each Holder.
Section 6. Conversion.
(a) Automatic Conversion. Upon receipt of Shareholder Approval, each share of Series A Preferred Stock shall automatically convert, without any notice to, or action on the part of, the Holder, into that number of shares of Common Stock determined by multiplying the
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number of shares of Series A Preferred Stock held by such Holder by the Conversion Ratio. Upon the automatic conversion of each share of Series A Preferred Stock pursuant to this Section 6(a) (such date, the Conversion Date), the Corporation shall instruct the Transfer Agent to issue the Conversion Shares in book-entry form in the name of such Holder. Each Holder shall deliver any certificate(s) representing such shares of Series A Preferred Stock to the Corporation promptly following the Conversion Date. Shares of Series A Preferred Stock converted into Common Stock shall be canceled. Immediately following any conversion, the rights of the Holders of any converted Series A Preferred Stock shall cease and the Persons entitled to receive Common Stock upon the conversion of Series A Preferred Stock shall be treated for all purposes as having become the owners of such Common Stock.
(b) Mechanics of Conversion
i. Delivery of Conversion Shares upon Conversion. Promptly following the Conversion Date, but not later than the earlier of (i) two Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined below) after the Conversion Date (the Share Delivery Date), the Corporation shall deliver, or cause to be delivered, to the Holders of Series A Preferred Stock the number of Conversion Shares to be issued upon the conversion of the Series A Preferred Stock. When delivering the Conversion Shares as provided herein, the Corporation shall use commercially reasonable efforts to deliver the Conversion Shares required to be delivered by the Corporation under this Section 6 through the Transfer Agent, unless otherwise agreed to with the Holders. As used herein, Standard Settlement Period means the standard settlement period, expressed in a number of Trading Days, on the Corporations primary Trading Market with respect to the Common Stock as in effect on the Conversion Date.
ii. Obligation Absolute; Partial Liquidated Damages. The Corporations obligation to issue and deliver the Conversion Shares upon conversion of Series A Preferred Stock in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by a Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by such Holder or any other Person of any obligation to the Corporation or any violation or alleged violation of law by such Holder or any other person, and irrespective of any other circumstance which might otherwise limit such obligation of the Corporation to such Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery shall not operate as a waiver by the Corporation of any such action that the Corporation may have against such Holder. Nothing herein shall limit a Holders right to pursue actual damages for the Corporations failure to deliver Conversion Shares within the period specified herein and such Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance, injunctive relief, or both specific performance and injunctive relief. The exercise of any such rights shall not prohibit a Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.
iii. Reservation of Shares Issuable Upon Conversion. The Corporation covenants that it will at all times reserve and keep available out of its authorized and unissued shares of
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Common Stock for the sole purpose of issuance upon conversion of the Series A Preferred Stock as herein provided, free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of the Series A Preferred Stock), not less than such aggregate number of shares of the Common Stock as shall be issuable (taking into account the adjustments and restrictions of Section 7) upon the conversion of the then outstanding shares of Series A Preferred Stock. The Corporation covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable.
iv. Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of the Series A Preferred Stock. In lieu of any fractional shares to which the Holder would otherwise be entitled, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of a share of Common Stock as determined in good faith by the Board of Directors of the Corporation.
v. Compliance with Nasdaq Stock Market Rules. Notwithstanding anything to the contrary set forth in this Certificate of Designation, the Corporation shall not issue any shares of Common Stock upon conversion of the Series A Preferred Stock to the extent that the issuance of such shares of Common Stock would exceed 19.99% of the Companys outstanding shares of Common Stock as of the date of the initial issuance of the Series A Preferred Stock, unless Shareholder Approval is obtained to issue more than such 19.99% (the Conversion Cap). The Conversion Cap shall be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction. The determination of the applicability of the limitation contained in this Section 6(c)(v) shall be made solely by the Corporation in accordance with the rules and regulations of the Nasdaq Stock Market.
vi. Transfer Taxes and Expenses. The issuance of Conversion Shares upon conversion of the Series A Preferred Stock shall be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion Shares. The Corporation shall pay all transfer agent fees required for same-day processing and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for electronic delivery of the Conversion Shares, if such delivery is available pursuant to the standard rules and conditions of such clearing corporation.
vii. Effect of Conversion. Upon conversion each outstanding share of Series A Preferred Stock so converted shall cease to be outstanding and all rights in respect of such share shall terminate, other than the right to receive appropriate evidence of the shares of Common Stock registered in book-entry form into which such share of Series A Preferred Stock has been converted, together with cash in lieu of any fractional share, as provided herein.
Section 7. No Redemption. The Series A Preferred Stock shall not be redeemable at the election of the Corporation or at the election of the Holder.
Section 8. Maturity. The Series A Preferred Stock shall be perpetual unless converted in accordance herewith.
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Section 9. No Preemptive Rights. No share of Series A Preferred Stock shall have any rights of preemption whatsoever as to any securities of the Corporation, or any warrants, rights or options issued or granted with respect thereto, regardless of how such securities, or such warrants, rights or options, may be designated, issued or granted.
Section 10. Other Rights. The shares of Series A Preferred Stock shall not have any voting powers, preferences or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Certificate of Incorporation or as provided by applicable law.
Section 11. Certain Adjustments.
(a) If the Corporation, at any time while this Series A Preferred Stock is outstanding: (i) subdivides outstanding shares of Common Stock into a larger number of shares, (ii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iii) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Corporation, then the Conversion Ratio shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately after such event, and of which the denominator shall be the number of shares of Common Stock (excluding any treasury shares of the Corporation) outstanding immediately before such event. Any adjustment made pursuant to this Section 11(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
(b) Pro Rata Distributions. During such time as this Series A Preferred Stock is outstanding, if the Corporation declares or makes any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a Distribution), at any time after the issuance of this Series A Preferred Stock, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Series A Preferred Stock immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution.
(c) Fundamental Transaction. During such time as this Series A Preferred Stock is outstanding, if (i) the Corporation, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Corporation with or into another Person and the Corporation is not the surviving entity, (ii) the Corporation, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Corporation or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or
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more of the outstanding Common Stock, (iv) the Corporation, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Corporation, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a Fundamental Transaction), then each Holder shall automatically receive, for each Conversion Share that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction, the same consideration receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which the Preferred Stock is convertible immediately prior to such Fundamental Transaction.
(d) Calculations. All calculations under this Section 11 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 11, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Corporation) issued and outstanding.
(e) Notice to the Holders. If (A) the approval of any stockholders of the Corporation shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Corporation is a party, any sale or transfer of all or substantially all of the assets of the Corporation, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property or (B) the Corporation shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Corporation, then, in each case, the Corporation shall cause to be filed at each office or agency maintained for the purpose of conversion of this Series A Preferred Stock, and shall cause to be delivered by facsimile or email to each Holder at its last facsimile number or email address as it shall appear upon the stock books of the Corporation, at least twenty (20) calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Corporation, the Corporation shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.
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Section 12. Miscellaneous.
(a) Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder shall be in writing and delivered personally, by facsimile or e-mail, or sent by a nationally recognized overnight courier service, addressed to the Corporation, at the following address: 235 Yorkland Blvd., Suite 900, Toronto, Ontario M2J 4Y8 , Attention: General Counsel, e-mail address firstname.lastname@example.org, or such other facsimile number, e-mail address or address as the Corporation may specify for such purposes by notice to the Holders delivered in accordance with this Section 12. Any and all notices or other communications or deliveries to be provided by the Corporation hereunder shall be in writing and delivered personally, by facsimile, e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number, e-mail address or address of such Holder appearing on the books of the Corporation and the Transfer Agent. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail at the e-mail address set forth in this Section 12 prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given.
(b) Lost or Mutilated Series A Preferred Stock Certificate. If a Holders Series A Preferred Stock certificate (if any) shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the shares of Series A Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership thereof reasonably satisfactory to the Corporation.
(c) Status of Converted Series A Preferred Stock. If any shares of Series A Preferred Stock shall be converted, redeemed or reacquired by the Corporation, such shares shall resume the status of authorized but unissued shares of Preferred Stock and shall no longer be designated as Series A Convertible Preferred Stock.
(d) Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Certificate of Designation shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware without regard to the principles of conflict of laws thereof. All legal proceedings concerning the interpretation, enforcement and defense of the transactions contemplated by this Certificate of Designation (whether brought against a party hereto or its respective Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the United States District Court for the District of Delaware or, to the extent that neither of the foregoing courts has jurisdiction, the Superior Court of the State of Delaware in Wilmington, Delaware (the Delaware Courts). The Corporation and each Holder hereby irrevocably submits to the
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exclusive jurisdiction of the Delaware Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such Delaware Courts, or such Delaware Courts are improper or inconvenient venue for such proceeding. The Corporation and each Holder hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Certificate of Designation and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by applicable law. The Corporation and each Holder hereto hereby irrevocably waives, 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 Certificate of Designation or the transactions contemplated hereby. If the Corporation or any Holder shall commence an action or proceeding to enforce any provisions of this Certificate of Designation, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.
(e) Waiver. Any waiver by the Corporation or a Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive that party (or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation on any other occasion. Any waiver by the Corporation or a Holder must be in writing.
(f) Severability. If any provision of this Certificate of Designation is invalid, illegal or unenforceable, the balance of this Certificate of Designation shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law.
(g) Headings. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Designation and shall not be deemed to limit or affect any of the provisions hereof.
RESOLVED, FURTHER, that the Chief Executive Officer, the president or any vice-president, and the secretary or any assistant secretary, of the Corporation be and they hereby are authorized and directed to prepare and file this Certificate of Designation of Preferences, Rights and Limitations in accordance with the foregoing resolution and the provisions of Delaware law.
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IN WITNESS WHEREOF, the undersigned have executed this Certificate this 18th day of March, 2020.
|By:||/s/ Domenic Serafino||By:||/s/ Domenic DiSisto|
|Name:||Domenic Serafino||Name:||Domenic DiSisto|
|Title:||Chief Executive Officer||Title:||General Counsel and Corporate Secretary|
Venus Concept Inc. Announces $22.25 Million Equity Financing
TORONTO, March 18, 2020 (GLOBE NEWSWIRE) Venus Concept Inc. (Venus Concept or the Company) (NASDAQ: VERO), a global medical aesthetic technology leader, today announced that it entered into a definitive agreement for the sale of shares of its common stock, Series A convertible preferred stock and warrants to purchase common stock in a private placement to a group of investors, including EW Healthcare Partners, HealthQuest Capital and SEDCO Capital. The private placement is expected to result in gross proceeds to the Company of approximately $22.25 million, before deducting placement agent fees and other offering expenses.
Pursuant to the terms of the securities purchase agreement, the Company will issue 2,300,000 shares of common stock, 660,000 shares of Series A convertible preferred stock, which are convertible into 6,600,000 shares of common stock, and warrants to purchase 6,675,000 shares of common stock. The Series A preferred stock will automatically convert into common stock upon receipt of stockholder approval. The Series A preferred stock has no voting rights. The closing of the private placement is subject to certain conditions and is expected to occur on or before March 20, 2020. Proceeds from the private placement will be used for general corporate purposes.
Stifel is acting as lead placement agent for the private placement. BTIG is acting as co-placement agent for the private placement.
The offer and sale of the foregoing securities are being made in a transaction not involving a public offering and have not been registered under the Securities Act of 1933, as amended (the Securities Act), or applicable state securities laws, and will be sold in a private placement pursuant to Section 4(a)(2) and/or Regulation D of the Securities Act. The securities may not be offered or sold in the United States absent registration or pursuant to an exemption from the registration requirements of the Securities Act and applicable state securities laws. The Company has agreed to file a registration statement covering the resale of the common stock acquired by the investors in the private placement.
This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any state or jurisdiction in which such offer or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction.
About Venus Concept
Venus Concept is an innovative global medical aesthetic technology leader with a broad product portfolio of minimally invasive and non-invasive medical aesthetic technologies and reach in over 60 countries and 29 direct markets. Venus Concept focuses its product sales strategy on a subscription-based business model in North America and in its well-established direct global markets. Venus Concepts product portfolio consists of aesthetic device platforms, including Venus Versa, Venus Legacy, Venus Velocity, Venus Fiore, Venus Viva, Venus Freeze Plus and Venus Bliss. Venus Concepts hair restoration division includes NeoGraft, an automated hair restoration system that facilitates the harvesting of follicles during a follicular unit extraction surgery, or FUE, process and the ARTAS® and ARTAS® iX Robotic Hair Restoration Systems,
which harvest follicular units directly from the scalp and create recipient implant sites using proprietary algorithms.
Cautionary Statement Regarding Forward-Looking Statements
This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934. These statements, including expected revenue, operating results and other financial information, and projected product launch timing, involve risks and uncertainties that may cause results to differ materially from those set forth in the statements. These statements are based on current plans, estimates and projections, and therefore, you are cautioned not to place undue reliance on them. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. Venus Concept undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by law. Forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our business and future financial results and the medical device industry, and other legal, regulatory and economic developments. We use words such as anticipates, believes, plans, expects, projects, future, intends, may, should, could, estimates, predicts, potential, continue, guidance, and similar expressions which are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results could differ materially from the results contemplated by these forward-looking statements. Material factors that could cause actual results to differ materially from current expectations include, without limitation, the following: the progress of the commercialization, marketing and manufacturing capabilities for our products; the number of Venus Concept systems that we sell; the success of the commercial launch of Venus Bliss and NeoGraft 2.0; the timing or likelihood of regulatory filings and approvals for products; the expected synergies and cost savings from the merger; the expected revenue for the company and the impact of current economic conditions as a result of the COVID-19 pandemic. Venus Concept cannot give any assurances that it will achieve its expectations. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that affect our business described in the Risk Factors included in the Current Report on Form 8-K filed with the SEC on March 18, 2020, as well as any reports that we may file with the SEC in the future.
Investor Relations Contact:
Westwicke Partners on behalf of Venus Concept
Mike Piccinino, CFA