Sevion Therapeutics, Inc. (OTCMKTS:SVON) Files An 8-K Entry into a Material Definitive Agreement

Sevion Therapeutics, Inc. (OTCMKTS:SVON) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01 Entry into a Material Definitive Agreement.

Consent and Waiver Agreement

As previously disclosed, between May and July 2015, Sevion
Therapeutics, Inc., a Delaware corporation (the Company)
conducted a financing transaction in which it issued to investors
units consisting of either (i) shares of the Companys common
stock, par value $0.01 (the Common Stock), or, at the
election of the Subscriber, (ii) shares of the Companys 0% Series
C Convertible Preferred Stock, par value $0.01 per share (the
Series C Preferred Stock) and a warrant to purchase one
half of one share of Common Stock at an exercise price of $1.50,
and also issued certain warrants to its placement agent as
partial compensation for its services (hereinafter referred to as
the 2015 Financing). In connection with the 2015
Financing, the Company granted certain anti-dilution and exercise
price adjustment rights to the investors and placement agent
(hereinafter referred to as the Price Protection
Provisions
).

The Price Protection Provisions expired on January 27, 2017.
Notwithstanding this, on February 15, 2017, in connection with
the Notes and the Exchange Agreement (both as defined below), the
Company executed a consent and waiver agreement, by and among the
Company and certain investors (the Consent and Waiver
Agreement
), which extended the Price Protection Provisions
and set a floor at $0.40 per share, which was triggered by the
Notes. The foregoing description of the terms of the Consent and
Waiver Agreement is qualified in its entirety by the provisions
of the Consent and Waiver Agreement, which is filed as Exhibit
10.1 hereto and incorporated by reference herein.

Item 3.02 Unregistered Sale of Equity Securities

Preferred Stock Exchange Agreement

On February 15, 2017, in connection with the issuance of the
Notes discussed below, certain of the holders of the Companys
outstanding 10% Convertible Series A Preferred Stock, par value
$0.01 per share (the Series A Preferred Stock) exchanged
310 shares of Series A Preferred Stock for 1,240,000 shares of
Common Stock, at an exchange price of $0.25 per share, to a
preferred stock exchange agreement, by and among the Company and
the holders of its Series A Preferred Stock (the Exchange
Agreement
). The foregoing description of the terms of the
Exchange Agreement is qualified in its entirety by the provisions
of the Exchange Agreement, which is filed as Exhibit 10.2 hereto
and incorporated by reference herein.

The shares of Common Stock issued to the Exchange Agreement were
issued solely to former holders of Series A Preferred Stock, upon
exchange to the exemption from registration provided under
Section 3(a)(9) of the Securities Act of 1933, as amended (the
Securities Act). This exemption is available to the
Company because the shares of Common Stock were exchanged by the
Company with its existing security holders with no commission or
other remunerations being paid or given for soliciting such an
exchange.

Convertible Promissory Notes

On February 15, 2017, the Company issued convertible
promissory notes (the Notes) in the aggregate amount of
$500,000 to OPKO Health, Inc. and an existing stockholder of the
Company (the Noteholders). The Notes have customary events
of default, an interest rate of 6% per annum, and principal and
interest due six months from the date of issuance (the
Maturity Date).

The Notes provide for mandatory conversion: (a) if the Company
enters into a transaction or series of transactions for an
aggregate sale price of at least One Million Dollars ($1,000,000)
of the Companys capital stock (referred to as the Qualified
Financing
) then the outstanding principal balance and accrued
but unpaid interest on the Notes will automatically convert into
such capital stock sold in the Qualified Financing at a
conversion price equal to the lesser of (i) the price per share
paid by investors at the close of the Qualified Financing or (ii)
$0.10 (the Conversion Price); or (b) upon a sale of all or
substantially all of the Companys assets, whether by sale,
acquisition or merger, the outstanding principal balance and
accrued but unpaid interest on the Notes will automatically
convert at the Conversion Price into shares of Common Stock or
such other securities on terms and conditions agreed upon by the
Company and the holders of a majority of the outstanding
principal amount of the Notes. Additionally, the Notes contain an
optional conversion feature which provides that all or any
portion of the outstanding principal balance and accrued but
unpaid interest on the Notes may be converted at the Conversion
Price.

In connection with the issuance of the Notes, the Company also
amended and restated promissory notes issued to the Noteholders
in November 2016 (the Previous Notes) in order to make the
Previous Notes convertible upon the same terms as the Notes. As
previously publicly disclosed, the Previous Notes had customary
events of default, an interest rate of 5% per annum, and
principal and interest due twelve months from their issuance. The
Previous Notes, as amended and restated, are referred to as the
Amended Notes.

Notwithstanding the above, the Notes and the Amended Notes
contain a blocker feature which does not allow for conversion if
it would cause such purchasers beneficial ownership of the shares
of capital stock of any class of the Company outstanding at the
time of conversion to exceed 4.99%, except that the Company may
increase this beneficial ownership limitation to 9.99% in such
purchasers sole discretion upon sixty-one (61) days notice. This
limitation automatically terminates on the date that is fifteen
(15) days prior to the Maturity Date. The foregoing description
of the terms of the Notes and the Amended Notes is qualified in
its entirety by the provisions of the Notes and Amended Notes,
which are filed hereto as Exhibits 4.1 and 4.2, respectively, and
incorporated by reference herein.

The Notes and the Amended Notes were issued to the exemption from
registration afforded by Section 4(a)(2) of the Securities Act.

Item 9.01. Financial Statements and Exhibits.

(d)Exhibits.

Exhibit No. Description
4.1

Form of Convertible Promissory Note, dated as of February
15, 2017, by and among the Company and the Noteholders.

4.2

Form of Amended and Restated Convertible Promissory Note,
dated as of February 15, 2017, by and among the Company and
the Noteholders, amending and restating the Previous Notes,
dated November 10, 2016.

10.1

Form of Consent and Waiver Agreement, dated as of February
15, 2017, by and among the Company and the Investors listed
as signatories thereto.
10.2 Form of Series A Preferred Stock Exchange Agreement, dated as
of February 15, 2017, by and among the Company and the
Holders listed as signatories thereto.


About Sevion Therapeutics, Inc. (OTCMKTS:SVON)

Sevion Therapeutics, Inc. is a development-stage biotech company. The Company is engaged in building and developing a portfolio of therapeutics, from both internal discovery and acquisition, for the treatment of cancer and immunological diseases. The Company is engaged in the development and licensing of technology to discover and engineer monoclonal antibodies. The Company’s product candidates are derived from multiple technology platforms, such as cell-based arrayed antibody discovery, ultralong antibody scaffolds and Chimerasome nanocages. The Company has various antibodies in its preclinical pipeline. The Company’s antibody therapeutic candidates target the potassium channel, voltage dependent (Kv1.3) ion channel, which is essential in the pathogenesis of several autoimmune and inflammatory disorders. Other antibodies in its pipeline target cell surface molecules involved in cancer progression.

Sevion Therapeutics, Inc. (OTCMKTS:SVON) Recent Trading Information

Sevion Therapeutics, Inc. (OTCMKTS:SVON) closed its last trading session down -0.020 at 0.250 with shares trading hands.

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