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CEMP > SEC Filings for CEMP > Form 8-K on 6-Jun-2013All Recent SEC Filings

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Form 8-K for CEMPRA, INC.


6-Jun-2013

Entry into a Material Definitive Agreement, Unregistered Sale of Equity Securities,


Item 1.01. Entry into a Material Definitive Agreement.

On May 31, 2013, Cempra, Inc. entered into an Amendment No. 2 to Loan and Security Agreement ("Amendment No. 2") with Hercules Capital Funding Trust 2012-1 ("Hercules Trust") and Hercules Technology Growth Capital, Inc. ("HTGC" and, together with Hercules Trust, "Hercules"), pursuant to which Hercules agreed to provide us with additional credit of approximately $5.2 million, which amount we borrowed at closing (the "Financing"). We paid Hercules a facility charge of $250,000 at closing. We also received an extension through September 30, 2013 for borrowing the remaining $10.0 million available under the Loan and Security Agreement with HTGC, dated December 20, 2011 (as amended, the "Loan Agreement") with the right to borrow contingent upon raising $40.0 million in an equity offering and/or a strategic partnering transaction. We will be required to make interest only payments through May 31, 2014, after which we will be required to pay the aggregate balance of the outstanding loan in 36 equal monthly installments of principal and interest, with a final payment due upon maturity on June 1, 2017. All of our assets, except for our intellectual property, remain subject to the security interest created in favor of Hercules under the Loan Agreement.

Upon the earliest to occur of (i) December 1, 2015, (ii) the date that we prepay the outstanding secured obligations under the Loan Agreement in full, or
(iii) the acceleration of the secured obligations under the Loan Agreement, we must pay HTGC an end-of-term charge of $400,000. In addition, on the earliest to occur of (i) June 1, 2017, (ii) the date that we prepay the outstanding secured obligations under the Loan Agreement in full, or (iii) the acceleration of the secured obligations under the Loan Agreement, we must pay HTGC a charge equal to $495,245.

In connection with Amendment No. 2, we issued a warrant to HTGC (the "Warrant") and amended and restated in its entirety the warrant issued to HTGC in December 2011, at the initial closing of the Loan Agreement (the "Amended and Restated Warrant"). The Warrant provides HTGC with the right to purchase an aggregate number of shares of our common stock equal to the quotient derived by dividing $609,533 by the exercise price then in effect, which is defined as the lower of
(a) $6.11, and (b) the effective price per share of our common stock issued or issuable in any offering of our equity or equity-linked securities that occurs within 12 months after May 31, 2013, provided that such offering is effected principally for equity or debt-financing purposes. The Amended and Restated Warrant provides HTGC with the right to purchase up to 39,038 shares of our common stock at an exercise price equal to the lower of (a) $6.11, and (b) the effective price per share of our common stock issued or issuable in any offering of our equity or equity-linked securities that occurs within 12 months after May 31, 2013, provided that such offering is effected principally for equity or debt-financing purposes.

The foregoing is a summary of the terms of the Financing, including the Loan Agreement, Amendment No. 2, the Warrant and the Amended and Restated Warrant, and does not purport to be complete and is qualified in its entirety by reference to the full text of the Loan Agreement, which is filed as Exhibit 10.7 to our Form S-1/A filed with the SEC on December 22, 2011, and Amendment No. 2, the Warrant and the Amended and Restated Warrant, copies of which are attached hereto as Exhibits 10.12, 4.9 and 4.10, respectively, and are incorporated by reference herein.




Item 3.02 Unregistered Sales of Equity Securities

The information contained in Item 1.01 is incorporated by reference hereunder. The securities issued in the Financing were offered and sold in transactions exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(2) thereof.



Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

        Exhibit No.        Description

         4.9               Warrant Agreement, dated May 31, 2013, issued to Hercules
                           Technology Growth Capital, Inc.

         4.10              Amended and Restated Warrant Agreement, dated May 31, 2013,
                           issued to Hercules Technology Growth Capital, Inc.

         10.12             Amendment No. 2 to Loan and Security Agreement, dated May
                           31, 2013, by and among Cempra, Inc., and each of its
                           subsidiaries signatory thereto, and Hercules Capital
                           Funding Trust 2012-1, as a lender and Hercules Technology
                           Growth Capital, Inc., as a lender and as an agent for the
                           lenders.


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