AZURRX BIOPHARMA, INC. (NASDAQ:AZRX) Files An 8-K Entry into a Material Definitive Agreement

AZURRX BIOPHARMA, INC. (NASDAQ:AZRX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement

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On February 14, 2019, AzurRx BioPharma, Inc. (the “Company”) entered into a Note Purchase Agreement (the “NPA”), a copy of which is attached hereto as Exhibit 10.1, with ADEC Private Equity Investments, LLC (“ADEC”), to which the Company issued to ADEC two Senior Convertible Notes (each a “Note,” and together, the “Notes”), in the principal amount of $1.0 million per Note, copies of which are attached hereto as Exhibit 10.2 (“Note A”) and Exhibit 10.3 (“Note B”), resulting in gross proceeds to the Company of $2.0 million.

The Notes accrue interest at a rate of 10% per annum (the “Interest Rate”); provided, however, that in the event the Company elects to repay the full balance due under the terms of both Notes prior to December 31, 2019, then the interest rate will be reduced to 6% per annum. The Notes shall mature on the earlier to occur of (i) the tenth business day following the receipt by the Company or AzurRx BioPharma SAS, a wholly owned subsidiary of the Company (“ABS”), of certain tax credits that the Company is expected to receive prior to July 2019 in the case of Note A (the “2019 Tax Credit”) and July 2020 in the case of Note B (the “2020 Tax Credit”), or (ii) December 31, 2019 in the case of Note A and December 31, 2020 in the Case of Note B (the “Maturity Dates”). As a condition to entering into the NPA, ABS and ADEC also entered into a Pledge Agreement, in substantially the form attached hereto as Exhibit 10.4, to which ABS agreed to pledge an interest in the 2019 and 2020 Tax Credits to ADEC in order to guarantee payment of all amounts due under the terms of the Notes.

Prior to their respective Maturity Dates, each of the Notes is convertible, at ADEC’s option, into shares of the Company’s common stock, $0.0001 par value (“Common Stock”), at a conversion price equal to the principal and accrued interest due under the terms of the Notes divided by $2.50 (“Conversion Shares”); provided, however, that to the term of the Notes, ADEC may not convert all or a portion of the Notes if such conversion would result in ADEC and/or entities or persons affiliated with ADEC beneficially owning in excess of 19.99% of the Company’s shares of Common Stock issued and outstanding immediately after giving effect to the issuance of the Conversion Shares.

As additional consideration for entering into the NPA, to a Warrant Amendment Agreement, a copy of which is attached hereto as Exhibit 10.5, the Company agreed to reduce the exercise price of certain warrants previously issued by the Company to ADEC and its affiliates, totaling warrants to purchase 1,009,565 shares (the “Warrants”), to $1.50 per share. The Warrant AmendmentAgreement does not alter any other terms of the Warrants.

In connection with the above transaction, the Company also entered into a registration rights agreement with ADEC (the “Registration Rights Agreement”), a copy of which is attached hereto as Exhibit 10.6, to which the Company agreed to file a registration statement with the Securities and Exchange Commission no later than 45 days after the closing date in order to register, on behalf of ADEC, the Conversion Shares.

The issuance of the Notes was exempt from the registration requirements of the Securities Act of 1933, as amended, in accordance with Section 4(a)(2) and/or Regulation 506 promulgated thereunder, as a transaction by an issuer not involving a public offering.

The foregoing description of the NPA, Note A, Note B, form of Pledge Agreement, Warrant AmendmentAgreement and Registration Rights Agreement do not purport to be complete, and are qualified in their entirety by reference to the same, attached hereto asExhibits 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6, respectively, each of which are incorporated by reference herein.

Item 2.03Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

See Item 1.01.

Item 3.02Unregistered Sales of Equity Securities.

See Item 1.01.

Item 3.03 Material Modifications to Rights of Security Holders

See Item 1.01.

Item 8.01 Other Events

On February 20, 2019, the Company announced that it has dosed the first patients in the Company’s Phase II OPTION study to investigate MS1819-SD in cystic fibrosis patients with exocrine pancreatic insufficiency. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K, and is incorporated by reference herein.

Item 9.01Financial Statements and Exhibits

See Exhibit Index.

AzurRx BioPharma, Inc. Exhibit
EX-10.1 2 azrx_ex101.htm NOTE PURCHASE AGREEMENT Blueprint   Exhibit 10.1   NOTE PURCHASE AGREEMENT   This Note Purchase Agreement (this “Agreement”) is dated as of February 14,…
To view the full exhibit click here

About AZURRX BIOPHARMA, INC. (NASDAQ:AZRX)

AzurRx BioPharma, Inc. is a clinical development-stage biopharmaceutical company. The Company is engaged in the research and development of non-systemic biologics for the treatment of patients with gastrointestinal (GI) disorders. The Company’s product pipeline consists of two therapeutic proteins, such as MS1819 and AZX1101. MS1819 is an acid-resistant secreted lipase produced by Yarrowia lipolytica, known as LIP2, that the Company is developing through recombinant deoxyribonucleic acid (DNA) technology for the treatment of exocrine pancreatic insufficiency (EPI), associated with chronic pancreatitis (CP) and cystic fibrosis (CF). AZX1101 is a recombinant-lactamase combination of bacterial origin under development for the prevention of hospital-acquired infections by resistant bacterial strains induced by parenteral administration of b-lactam antibiotics (known as nosocomial infections), as well as the prevention of antibiotic-associated diarrhea (AAD).

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