Item 1.01 Entry into a Material Definitive Agreement.
As previously disclosed in the Current Report on Form 8-K filed by Gelesis Holdings, Inc. (the “Company”) with the SEC on February 23, 2023, on February 21, 2023, the Company and Gelesis, Inc., a subsidiary of the Company (the “Co-Issuer” and together with the Company, the “Notes Issuers”), entered into a Note and Warrant Purchase Agreement, dated February 21, 2023 (the “NPA”), with Gelesis 2012, Inc., Gelesis, LLC, and other subsidiaries of the Notes Issuers party thereto from time to time (the “Guarantors” and collectively with the Notes Issuers, the “Note Parties”) and PureTech Health LLC (the “Initial Investor”), pursuant to which, on February 21, 2023, for a cash purchase price of $5.0 million: (i) the Notes Issuers issued a short term convertible senior secured note of the Company in the aggregate principal amount of $5.0 million (the “Initial Note”) to the Initial Investor and (ii) the Company issued to the Initial Investor warrants to purchase 23,688,047 shares of common stock, par value $0.0001, of the Company (the “Common Stock”). As previously disclosed, pursuant to the NPA, at the Company’s option at any time after those certain conditions enumerated in the NPA (the “Conditions”) are first satisfied, or otherwise waived by the Initial Investor, the Company shall sell and issue to the Initial Investor additional notes in an aggregate principal amount of up to $5.0 million (the “Additional Notes,” collectively with the Initial Note, the “Notes”).
In addition, as previously disclosed in the Current Report on Form 8-K filed by the Company with the SEC on May 3, 2023, on May 1, 2023, the Note Parties entered into Amendment No. 1 to the NPA (the “Amendment”), pursuant to which, among other things, for a cash purchase price of $2.0 million: (i) the Initial Investor waived the Conditions with respect to the issuance of $2.0 million aggregate principal amount of Additional Notes (the “Second Closing Notes”) to the Initial Investor and the Note Parties and the Initial Investor amended the Conditions for future issuances of Additional Notes (the “Amended Conditions”), (ii) the Notes Issuers issued to the Initial Investor the Second Closing Notes and (iii) the Company issued to the Initial Investor additional warrants to purchase up to 192,307,692 shares of Common Stock, at an exercise price of $0.0182. Except as set forth in the Amendment, all other terms of the Notes and Warrants remain in full force and effect.
Limited Waiver to the NPA and Issuance of Additional Notes
On May 26, 2023, the Note Parties entered into a Limited Waiver to the NPA (the “Waiver”), pursuant to which the Initial Investor waived the Amended Conditions with respect to the issuance of $350,000 aggregate principal amount of Additional Notes (the “Third Closing Notes”) to the Initial Investor. Pursuant to the NPA and the Waiver, on May 26, 2023, for a cash purchase price of $350,000: (i) the Notes Issuers issued to the Initial Investor the Third Closing Notes and (ii) the Company issued to the Initial Investor additional warrants to purchase up to 43,133,803 shares of Common Stock, at an exercise price of $0.0142 (the “Third Closing Warrants”).
The Notes have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), and are sold in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder, and on similar exemptions under applicable state laws. The NPA, as amended, provides for registration rights with respect to all shares of Common Stock issuable upon conversion of the Notes and upon exercise of the Warrants pursuant to which the Company is required to file a shelf registration statement under the Securities Act to register such shares for resale.
The foregoing descriptions of the Waiver, the Third Closing Notes and the Third Closing Warrants do not purport to be complete and are qualified in its entirety by the full text of such agreements, which are attached as exhibit 10.1, 10.2 and 10.3 to this Current Report and incorporated herein by reference.
