UNITED
STATES
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 20,
2010
VIRNETX
HOLDING CORPORATION
(Exact
name of registrant as specified in its charter)
|
Delaware
|
001-33852
|
77-0390628
|
|
(State
or other jurisdiction of incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification No.)
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| 5615 Scotts Valley Drive, Suite 110 Scotts Valley, CA | 95066 |
| (Address of principal executive offices) | (Zip Code) |
(831)
438-8200
(Registrant’s
telephone number, including area code)
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
|
o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a
-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d -2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e -4(c))
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Item
7.01.
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Regulation
FD Disclosure.
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On
February 24, 2010, VirnetX Holding Corporation, or VirnetX, announced that, as
of February 20, 2010, all Series III Warrants issued by VirnetX in a private
placement transaction that closed on September 2, 2009, or the Financing, have
been exercised in full. The aggregate cash exercise proceeds from the
Series III Warrants totaled $6,000,000. After payment of fees and
commissions, the Company received a net of $5,400,000.
As
previously announced, the Series II Warrants issued in the Financing as a price
protection feature have already expired unexercised, so there was no downward
adjustment made to the price per share paid by the investors in the
Financing.
As a
result of the expiration of the Series II Warrants, and the exercise in full of
the Series III Warrants, VirnetX believes that the Financing has occurred in the
most favorable manner possible for VirnetX. As it turns out, the Financing
enabled VirnetX to raise an aggregate of $12,000,000 of gross proceeds in two
tranches at a 20% discount to the agreed average market price at the time of the
Financing, with 50% premium warrant coverage.
The only
warrants issued in the Financing that are still outstanding are the 5-year
Series I Warrants covering the number of shares issued in the first tranche as
well as the placement agent’s warrants (2,619,036 shares) at $3.93 per share,
which reflected a premium of 125% of the agreed average market price at the time
of the Financing. Upon exercise, the Series I Warrants would yield an aggregate
of $10,300,000 in gross proceeds to VirnetX. The Series I Warrants
are not exercisable until March 11, 2010.
The
summary descriptions of the Series I Warrants, Series II Warrants and Series III
Warrants are qualified in their entirety by the terms the Series I Warrants,
Series II Warrants and Series III Warrants, copies of which were filed with the
Current Report on Form 8-K filed by VirnetX on September 3, 2009, and are
incorporated by reference herein.
On
February 24, 2010, VirnetX issued a press release announcing the exercise in
full of the Series III Warrants. A copy of the press release is
furnished as Exhibit 99.1 to this report. The information
contained in this report is furnished and not deemed to be filed for purposes of
Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that section. The information in this Current
Report on Form 8-K shall not be incorporated by reference into any filing or
other document pursuant to the Securities Act of 1933, as amended, except as
shall be expressly set forth by specific reference in such filing or
document.
Forward-Looking
Statements
Statements
in this press release that are not statements of historical or current fact
constitute “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other unknown factors that
could cause the actual results of VirnetX to be materially different from the
historical results or from any future results expressed or implied by such
forward-looking statements. In addition to statements which explicitly describe
such risks and uncertainties, readers are urged to consider statements labeled
with the terms “believes,” “belief,” “expects,” “intends,” “anticipates,” or
“plans” to be uncertain and forward-looking. The forward-looking statements
contained herein are also subject generally to other risks and uncertainties
that are described from time to time in VirnetX’s reports and registration
statements filed with the Securities and Exchange Commission, including those
under the heading “Risk Factors” in VirnetX’s Annual Report on Form 10-K filed
with the SEC on March 31, 2009 and most recently in VirnetX’s Quarterly Report
on Form 10-Q filed with the SEC on November 9, 2009.
2
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Item
9.01
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Financial
Statements and Exhibits.
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(d) Exhibits
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Exhibit
No.
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Description
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99.1
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Press
Release dated February 24, 2010.
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3
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 hereunto
duly authorized.
| Date: February 24, 2010 | VIRNETX HOLDING CORPORATION | ||
|
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By:
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/s/ Kendall Larsen | |
| Name: | Kendall Larsen | ||
| Title: | Chief Executive Officer | ||
4
Exhibit 99.1
VirnetX
Concludes $12 Million Raise
SCOTTS
VALLEY, Calif. – February 24, 2010 – VirnetX Holding Corporation (NYSE Amex:
VHC), a secure real-time communications and collaboration technology company,
today announced that as of February 20, 2010, all of the Series III Warrants
issued by VirnetX Holding Corporation, or the Company, in a private placement
transaction that closed on September 2, 2009, have been exercised in
full. The aggregate cash exercise proceeds from the Series III
Warrants totaled $6,000,000. This with the initial raise of
$6,000,000 through the purchase of common stock brings the private placement to
an aggregate of $12,000,000 to the Company.
The
Company believes that the Financing has occurred in the most favorable manner
possible for the Company. As it turns out, the Financing enabled the Company to
raise an aggregate of $12,000,000 of gross proceeds in two tranches at a 20%
discount to the agreed average market price at the time of the Financing, with
50% premium warrant coverage.
Warrants
issued in the Financing that are still outstanding are the 5-year Series I
Warrants covering the number of shares issued in the first tranche as well as
the placement agent’s warrants (2,619,036 total shares) at $3.93 per share,
which reflected a premium of 125% of the agreed average market price at the time
of the Financing. Upon exercise, the Series I Warrants would yield an aggregate
of $10,300,000 in gross proceeds to the Company. The Series I
Warrants are not exercisable until March 11, 2010.
About
VirnetX
VirnetX
Holding Corporation, a secure real-time communications and collaboration
technology company, is engaged in commercializing its patent portfolio, derived
from a Central Intelligence Agency security project, by developing a licensing
program, as well as developing software products designed to create a secure
environment for real-time communications such as instant messaging and Voice
over Internet Protocol. The Company’s patent portfolio includes over
48 U.S. and international patents and pending applications which provide the
foundation for the Company’s unique GABRIEL Connection Technology. For more
information, please visit www.virnetx.com
Safe
Harbor Agreement
Statements
in this press release that are not statements of historical or current fact
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other unknown factors that
could cause the actual results of the Company to be materially different from
the historical results or from any future results expressed or implied by such
forward-looking statements. In addition to statements which explicitly describe
such risks and uncertainties, readers are urged to consider statements labeled
with the terms "believes," "belief," "expects," "intends," "anticipates," or
"plans" to be uncertain and forward-looking. The forward-looking statements
contained herein are also subject generally to other risks and uncertainties
that are described from time to time in the Company’s reports and registration
statements filed with the Securities and Exchange Commission, including those
under the heading "Risk Factors" in the Company's Annual Report on Form 10-K
filed with the SEC on March 31, 2009 and most recently in the Company’s
Quarterly Report on Form 10-Q filed with the SEC on November 9,
2009.
Contact:
Greg
Wood
VirnetX
Holding Corporation
831.438.8200
greg_wood@virnetx.com