1
(conformed)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 8, 2001
DEMEGEN, INC.
(Exact name of registrant as specified in this charter)
Colorado 0-25353 84-1065575
---------------------------- ------------ -------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1051 Brinton Road, Pittsburgh, PA 15221
- ---------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including area code: (412) 241-2150
2
ITEM 5 - OTHER EVENTS
Effective January 1, 2001 the Company entered into a definitive license
agreement with an option to purchase with Periodontix, Inc for all of their
technologies and rights in related clinical trials, except for Periodontix'
photodynamic technology. The transaction is structured under a short-term
license agreement to permit the Company a period of time to evaluate
Periodontix's technology and obtain the necessary funds to support the
additional research, prior to exercising the purchase option. The terms or the
agreement are as follows:
o On December 15, 2000 the Company made a $50,000 good faith
non-refundable payment to Periodontix
o At the inception of the license agreement, the Company will issue
Periodontix 2.3 million restricted common shares of the Company's
Common Stock and warrants to purchase up to 2.3 million Common Shares
of the Company's Common Stock at an exercise price of $1.25 per share.
The Warrants have a five year term and are callable by the Company if
the price of the Company's common Stock trades above $2.50 per shares
for twenty consecutive trading days.
o Periodontix will receive a second issuance under the license agreement
by April 2, 2001 of 2 million restricted common shares of the Company's
Common Stock and warrants to purchase up to 2 million Common Shares of
the Company's Common Stock at an exercise price of $1.25 per share. The
Warrants have a five year term and is callable by the Company if the
price of the Company's common Stock trades above $2.50 per shares for
twenty consecutive trading days. If the Company does not make this
second issuance of shares and warrants because there is a material
adverse event related to the Periodontix technology or because the
Company does not secure sufficient new capital, the option will
expire and the license will be returned to Periodontix. If the
license is returned, Periodontix will return 80% of the common
shares and warrants previously issued.
o Under the license agreement, the Company will have an option to
purchase the aforementioned technologies, free and clear of all liens
and to terminate the license by July 31, 2001 with the issuance of 4.7
million restricted common shares of the Company's Common Stock and
warrants to purchase up to 4.7 million Common Shares of the Company's
Common Stock at an exercise price of $1.25 per share. The Warrants have
a five year term and is callable by the Company if the price of the
Company's common Stock trades above $2.50 per shares for twenty
consecutive trading days. The option date may be extended by the
Company until January 31, 2002 with the payment of 1 million restricted
Common Shares of the Company by July 31, 2001. If the option is
exercised after July 31, 2001, the number of Common Shares and Warrants
required to purchase the technologies will be 7 million each.
o Periodontix has agreed not to sell the technologies while the Company's
option is in force.
o Should any license or sublicense agreements be negotiated by the
Company with a customer for the licensed Periodontix technologies
prior to the exercise of the option to purchase by the Company, the
Company will receive the first $350,000 of any upfront license fees.
The remaining balance of any upfront license fees will be paid to
Periodontix in the Company's restricted Common Stock valued at the
closing price for the preceding twenty trading days.
o On January 1, 2001 the Company hired selected Periodontix employees to
facilitate the clinical trials and other tasks related to the combined
Company
o Beginning January 1, 2001 the Company agrees to pay Periodontix
for rent and utilities at their office and other operating expenses.
o As part of the license fee the Company agreed to pay $175,000 to
Periodontix on April 2, 2001 providing the Company makes the April 2,
2001 share and warrant issuance. If the aforementioned
2
3
issuance occurs, the Company will make a second $175,000 payment to
Periodontix on December 1, 2001.
ITEM 7 - FINANCIAL STATEMENTS & EXHIBITS
(c) Exhibits
PAGES OF
SEQUENTIAL
EXHIBIT INDEX NUMBERING SYSTEM
------------- ----------------
(99a) Option Agreement between Demegen, Inc. and Periodontix, Inc., dated
February 16, 2001
(99b) License Agreement between Demegen, Inc. and Periodontix, Inc.,
dated February 8, 2001
(99c) Form of Asset Purchase Agreement between Demegen, Inc. and
Periodontix, Inc.
(99d) Form of Demegen Warrant
(99e) Escrow Agreement between Demegen, Inc. and Periodontix, Inc.
dated February 16, 2001
3
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DEMEGEN, INC.
By /s/ Richard D. Ekstrom
-------------------------------------
Richard D. Ekstrom
Chairman and Chief Executive Officer
Date: February 20, 2001
4