CYREN LTD. (NASDAQ:CYRN) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On March 19, 2020, we closed the previously announced issuance and sale of $10.25 million aggregate principal amount of our 5.75% Convertible Debentures due March 19, 2024, or the Debentures, to Securities Purchase Agreements, dated March 16, 2020, or the Purchase Agreements, by and among us and certain purchasers named therein, or the Purchasers, which included the purchase by Brett Jackson, our Chief Executive Officer, of a Debenture in the principal amount of $250,000 to a Purchase Agreement. We refer to the issuance and sale of the Debentures herein as the Financing. Upon the closing, we received net proceeds of approximately $9.6 million after deducting placement agent and escrow agent fees and expenses.
As previously disclosed in connection with the Financing, on March 16, 2020, we entered into a registration rights agreement with the Purchasers.
Descriptions of the Purchase Agreements and the Registration Rights Agreement were included in our Current Report on Form 8-K dated March 17, 2020. Copies of the forms of Purchase Agreement and Registration Rights Agreement are filed as exhibits to this Current Report on Form 8-K, which copies are incorporated by reference herein.
We are filing a copy of the form of Purchase Agreement to provide security holders with information regarding its terms. It is not intended to provide any other factual information about us. The representations, warranties and covenants contained in the Purchase Agreement were made solely for purposes of the Financing and as of specific dates, were solely for the benefit of the parties to the Purchase Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to security holders. Security holders are not third-party beneficiaries under the Purchase Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of our company. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in our public disclosures.
Convertible Debentures and Subsidiary Guarantee
The Debentures are guaranteed on an unsecured basis by certain existing and future subsidiaries. The Debentures rank junior in right of payment to our convertible notes due December 2021. The Debentures have an initial conversion price of $0.75 per share, subject to adjustments, provided that the conversion price for the Debenture purchased by Mr. Jackson cannot be less than $0.73 per share. Interest on the Debentures is payable on September 19 and March 19 of each year, beginning on September 19, 2020 in cash or, subject to the satisfaction of certain equity conditions set forth in the Debentures, in ordinary shares at a rate of 5.75% per annum, calculated on the basis of a 360-day year, and will accrue daily until payment in full of the outstanding principal, together with all accrued and unpaid interest. We must pay late fees at a rate of the lesser of 18% per annum or the maximum rate permitted by law on overdue accrued and unpaid interest. If the closing bid price of our ordinary shares has been at least $2.25 (subject to adjustment) for at least 20 trading days during any 30 consecutive trading day period and certain conditions are satisfied, we may force the conversion of all or any part of the outstanding principal amount of the Debentures, accrued and unpaid interest and any other amounts then owing, subject to certain conditions.
As long as the Debentures are outstanding, we must obtain consent of the holders of at least 51% in principal amount of the Debentures to engage in, and for our subsidiaries to engage in, any of the following:
| 4.1 | Form of 5.75% Convertible Debenture due March 19, 2024 |
| 10.1 | Form of Securities Purchase Agreement, dated as of March 16, 2020, by and among Cyren Ltd. And the purchasers named therein |
| 10.2 | Form of Registration Rights Agreement, dated as of March 16, 2020, by and among Cyren Ltd. And the purchasers named therein |
| 10.3 | Form of Subsidiary Guarantee, dated as of March 19, 2020 |
CYREN Ltd. Exhibit
EX-4.1 2 ea119750ex4-1_cyren.htm FORM OF 5.75% CONVERTIBLE DEBENTURE DUE 2024 Exhibit 4.1 EXHIBIT A NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,…
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About CYREN LTD. (NASDAQ:CYRN)
CYREN Ltd. (CYREN) is engaged in developing and marketing information security solutions for protecting Web, e-mail and mobile transactions. The Company is a Security-as-a-Service provider of integrated cloud-based security technology solutions that mitigate cyber threats, malware attacks, information leaks, legal liability and productivity loss through the application of cyber intelligence. It delivers security services to a range of customers and original equipment manufacturer, and service provider distribution partners, including network and security vendors offering content security gateways, unified threat management solutions and antivirus solutions, and to service providers, such as Software-as-a-Service vendors, Web hosting providers and Internet service providers. Its technologies include CYREN GlobalView Cloud and Recurrent Pattern Detection. Its offerings include CYREN WebSecurity (CWS), CYREN EmailSecurity, Cyber Intelligence Suite and Embedded Solutions.
