Modular Medical, Inc 8-K, filed Feb 25, 2022
Modular Medical, Inc. (MODD)
About this 8-K
Modular Medical, Inc filed this 8-K on February 25, 2022, reporting on events of February 23, 2022.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Resignation of Chief Executive Officer
On February 23, 2022, Ellen O’Connor Vos informed the board of directors (the “Board”) of Modular Medical, Inc. (the “Company”) that she was resigning from her position as Chief Executive Officer of the Company, effective immediately (the “Resignation”). In connection with the Resignation, the Company and Ms. Vos entered into a Severance and Release Agreement dated February 23, 2022 (the “Separation Agreement”). Pursuant to the Separation Agreement, Ms. Vos will receive separation payments in an aggregate gross amount of $375,000. Under the terms of the Separation Agreement, the vesting of an option to purchase 362,452 shares of the Company’s common stock, which was granted to Ms. Vos on August 11, 2021 will cease on May 24, 2022 and the remaining unvested shares will be forfeited. The Separation Agreement also contains confidentiality and non-disparagement covenants and a release of claims by Ms. Vos. Ms. Vos will continue to serve as a member of the Board.
The foregoing is only a summary description of the terms of the Separation Agreement and does not purport to be complete and is qualified in its entirety by reference to the Separation Agreement, which will be filed as an exhibit to the Company’s Annual Report on Form 10-K for the fiscal year ending March 31, 2022.
Appointment of Chief Executive Officer
On February 23, 2022, in connection with the Resignation, the Board appointed Mr. James Besser, 46, as the Company’s Chief Executive Officer (the “Appointment”).
James “Jeb” Besser combines over 25 years of experience in alternative investments, strategic advisory, corporate strategy and corporate governance. Since 1999, he has been a Managing Member at Manchester Management Company, LLC (“Manchester”), an investment management firm. James Besser is also currently a director of River Stone Biotech, a development stage specialty bioprocessing company. He has an undergraduate degree from Brown University.
Family Relationships
Mr. Besser does not have a family relationship with any of the current officers or directors of the Company.
Related Party Transactions
Manchester, as the general partner of Manchester Explorer, L.P. (“Explorer”), combined with the holdings of its affiliates, JEB Partners LP, Mr. Besser and Morgan Frank, owns approximately 25% of the Company’s outstanding shares of common stock. Mr. Frank is one of our directors and serves as the portfolio manager of Explorer and as a managing member of Manchester.
In October 2021, the Company issued a secured promissory note (the “Bridge Note”) to Explorer that provided the Company with a $3,000,000 revolving credit facility with all amounts being drawn down by the Company thereunder being due and payable, subject to acceleration in the event of a default, on March 15, 2022. Interest at the rate of 12% was payable on each amount drawn down without regard to the draw-down date or the date when interest is paid. During the period from October 2021 to February 2022, the Company made draws of $2,100,000 on the Bridge Note, and the Company repaid to Explorer the draws and accrued interest in the amount of of $2,352,000 in February 2022.
On April 30, 2021, the Company issued a convertible promissory note (the “Convertible Note”) in the amount of $1,026,630 to Explorer. On February 14, 2022, in accordance with the terms of the Convertible Note, principal and accrued interest of $1,124,511 for the Convertible Note was converted into 234,274 shares of the Company’s common stock. In addition, in connection with the conversion, Explorer received a five-year warrant to purchase 234,274 shares of the Company’s common stock at a price of $6.60 per share.
Compensatory Arrangements
As compensation for his services as Chief Executive Officer, Mr. Besser shall be paid de minimis compensation of $1.00 per year.
| Item 8.01. | Other Events. |
On February 24, 2022, the Company issued a press release announcing the Appointment. A copy of the press release is filed hereto as Exhibit 99.1 and is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits: |
| Exhibit No. | Description | |
| 99.1 | Press Release dated February 24, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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.
| MODULAR MEDICAL, INC. | |||
| Date: February 25, 2022 | By: | /s/ James Besser | |
| James Besser | |||
| Chief Executive Officer | |||
Exhibit 99.1
Modular Medical Appoints James “Jeb” Besser as Chief Executive Officer
Lynn Vos to remain on board of directors
Besser brings 25 years of experience in life sciences, technology, capital markets
Company reaffirms timeline for 510(k) submission of MODD1 insulin pump to FDA
SAN DIEGO, CA, February 24, 2022 (ACCESSWIRE) — Modular Medical, Inc. (the “Company” or “Modular Medical”)(Nasdaq: MODD) today announced that its board of directors has appointed James “Jeb” Besser as Chief Executive Officer. Besser, a company development and capital markets veteran, has served 23 years as managing member of Manchester Management LLC, the Company’s largest outside shareholder and development partner since its inception. Lynn Vos, the Company’s CEO since August of 2021, will remain on the board of directors of the Company and continue an active role in the marketing and commercialization strategy for the Company, as the Company focuses on preparing and submitting to the FDA a 510(k) application for its next generation MODD1 insulin pump. The Company anticipates this submission to take place during Q2 of this year.
“Having been involved with the development of Modular Medical since its inception, I believe strongly in the Company and its mission to expand access to wearable insulin delivery technology,” said Besser. “This is a very exciting time in our lifecycle, and I would like to thank Lynn Vos for her role in managing the recent capital raise and Nasdaq uplist and for helping round out our board. I look forward to working with her going forward.”
“Modular Medical is now positioned with a focused team and the innovative technology to make a meaningful impact on the lives of people with diabetes. I was honored to step into the CEO role to help achieve the foundational work to set the Company upon this path,” said Vos. “I look forward to continuing to serve on the board of directors and to working with the Company on marketing and product positioning.”
Before joining the Company, Besser, 46, has served 23 years as managing member of Manchester Management LLC, the Company’s largest outside shareholder. He brings with him 25 years of U.S. public equity and capital markets experience, with a focus in life sciences and technology. Besser has provided long term strategic planning, due diligence and business development strategy, and investor relations guidance to over 100 public companies. He has been actively involved in developing the Company’s development and commercial strategy since 2017.
“The Board and I wish to thank Lynn for her leadership during this period of transition, and we are confident that Jeb is the right person to build on our current momentum and to take the Company to its next stage,” said Modular Medical founder, Paul DiPerna. “He is a seasoned leader with significant experience working with the public markets, planning strategy for development stage companies, and delivering value to shareholders. We are pleased to have him as our next CEO.”
About Modular Medical, Inc.
Modular Medical, Inc. (NASDAQ: MODD) intends to launch the first next generation of insulin delivery technology that will be both affordable and simple enough to learn and use to transform the insulin pump market into a mass market. Our patented technologies will eliminate the tradeoff between complexity and efficacy and seek to set new standards for insulin dosing that most closely mimics nature. Our mission is to improve access to the highest standards of glycemic control for people with diabetes taking it beyond “superusers” and providing “diabetes care for the rest of us.”
More information is available at https://modular-medical.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Modular Medical desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words “forecasts,” “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect,” and similar expressions, as they relate to us, are intended to identify forward-looking statements. The Company has based these forward-looking statements primarily on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements, include the Company’s expectations with respect to the Risk Factors contained within its filings with the SEC, including its Annual Report on Form 10-K for the year ended March 31, 2021. Any forward-looking statement made by the Company herein speaks only as of the date on which it is made. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. Modular Medical undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law.
All trademarks mentioned herein are the property of their respective owners.
CONTACT:
Jeb Besser
Chief Executive Officer
Modular Medical, Inc.
+1 (617) 399-1741
IR@modular-medical.com
SOURCE: Modular Medical, Inc.