VerifyMe, Inc. (OTCMKTS:VRME) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01

Effective as of June 15, 2020, VerifyMe, Inc. (the “Company”) entered into an agreement (the “Agreement”) with 23 of the 25 holders (the “Holders”) of senior secured convertible debentures (the “Debentures”) of the Company, representing $1,792,000 of the $1,992,000 aggregate principal amount of the Debentures, and three-year warrants (the “Warrants”) to purchase shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), received in connection with the Company’s private placement completed on March 6, 2020. The Company is currently engaged in a public offering (the “Offering”) of units (the “Units”) with each Unit consisting of one share of Common Stock (the “Uplist Shares”) and one warrant to purchase a share of Common Stock (the “Uplist Warrants”), and the listing of the Uplist Shares and Uplist Warrants in the Offering on a national securities exchange (collectively with the Offering, the “Uplist Transaction”).

to the Agreement, immediately upon the closing of the Uplist Transaction, the Warrants will be canceled and each Holder will receive 0.4 of a share of Common Stock (the “Shares”) for each share formerly underlying such canceled Warrant. Also, immediately upon the closing of the Uplist Transaction, each Debenture will automatically convert into Uplist Shares and Uplist Warrants at the lower of $0.08 per Unit or a 30% discount to the public offering price of the Units.

In connection with the Agreement, the Holders entered into lock-up agreements with the representative of the underwriters for the Uplist Transaction to which the Holders have agreed not to offer, sell, contract to sell, pledge or otherwise dispose of any Shares received upon cancelation of the Warrants, any Uplist Shares and Uplist Warrants acquired upon the automatic conversion of the Debentures, and any shares of Common Stock underlying such warrants for a period concluding on the earlier to occur of (i) 120 days after the closing of the Uplist Transaction or (ii) any time after 60 days after the closing of the Uplist Transaction in the event the shares of the Company’s Common Stock trade above two times the public offering price of the Uplist Shares for five consecutive trading days.

The Company has agreed to file a registration statement with the Securities and Exchange Commission registering for resale the Shares, the Uplist Shares, the Uplist Warrants and the shares of Common Stock underlying the Uplist Warrants (together, the “Registerable Securities”). The Company will use its best efforts to file the registration statement for the Registrable Shares within 90 days from the closing of the Uplist Transaction and have the registration statement declared effective within 120 days from the closing of the Uplist Transaction.

No changes will be made to the Debentures and Warrants issued to the two Holders who did not enter into the Agreement.

The foregoing summary of the Agreement does not purport to be complete, and is qualified in its entirety by reference to the Agreement, a copy of which is being filed herewith as Exhibit 10.1 and is incorporated herein by reference.

To the extent required by Item 3.03 of Form 8-K, the disclosure in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

(d)       Exhibits.

Exhibit No.	Description
10.1	Agreement dated as of June 15, 2020 (incorporated herein by reference from Exhibit 10.28 to the Company’s Registration Statement on Form S-1 (File No. 333-234155) filed on June 15, 2020).

  

About VerifyMe, Inc. (OTCMKTS:VRME)

VerifyMe, Inc., formerly LaserLock Technologies, Inc., operates in the anti-counterfeiting industry. The Company offers security solutions for identification and authentication of people, products and packaging in a range of applications in the security field for both digital and physical transactions. Its products are used to manage and issue secure credentials, including national identifications, passports, driver licenses and access control credentials, as well as authentication security software to secure physical and logical access to facilities, computer networks, Internet sites and mobile applications. Its digital technologies involve the utilization of multiple authentication mechanisms, some of which it owns and some of which it license. These mechanisms include biometric factors, knowledge factors, possession factors and location factors. The Company’s solutions allow the assessment and quantification of risk using a scoring mechanism.