Item 1.01. Entry into a Material Definitive Agreement.
As previously disclosed on August 13, 2024, simultaneously with the execution of that certain Arrangement Agreement by and between Greenbrook TMS Inc. and Neuronetics, Inc. (the “Neuronetics”), Neuronetics and Madryn Asset Management LP (“Madryn”) and its affiliates (the “Madryn Parties”) entered into a Registration Rights Agreement (the “Registration Rights Agreement”), pursuant to which the Madryn Parties are entitled to registration rights in respect of the Consideration Shares (as defined in the Arrangement Agreement) that the Madryn Parties receive upon consummation of the Arrangement Agreement.
Neuronetics and the Madryn Parties have agreed to amend the Registration Rights Agreement (the “Amendment”). Pursuant to the Amendment, three-hundred sixty-five (365) days following the consummation of the Arrangement (the “Demand Registration Period”), the Madryn Parties will have the right to demand registration of their Consideration Shares, subject to certain limitations. The Demand Registration Period was previously one hundred eighty (180) days. The Amendment is attached hereto as Exhibit 10.1.
The foregoing description of the Registration Rights Agreement and the Amendment does not purport to be complete and are qualified in their entirety by reference to the form of Registration Rights Agreement, which is filed as Exhibit 10.4 to the Current Report on Form 8-K filed on August 13, 2024 and the Amendment, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and are incorporated herein by reference.
“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995:
Certain statements in this communication and the Amendment, including the documents incorporated by reference therein, include “forward-looking statements” within the meaning of U.S. federal securities laws. These forward-looking statements are subject to the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words or expressions such as “expect”, “anticipate”, “intend”, “plan”, “believe”, “estimate”, “may”, “will”, “project”, “could”, “should”, “would”, “seek”, “forecast”, “expect”, “anticipate”, “predict”, “outlook”, “potential”, or other similar expressions, including without limitation the negative of these terms. Forward-looking statements represent current judgments about possible future events, including, but not limited to statements regarding expectations or forecasts of business, operations, financial performance, prospects, and other plans, intentions, expectations, estimates, and beliefs relating to the proposed transaction between Greenbrook TMS Inc. (“Greenbrook”) and Neuronetics, such as statements regarding the combined operations and prospects of Greenbrook and Neuronetics, estimates of pro forma financial information of the combined company, the current and projected market, growth opportunities and synergies for the combined company, federal and state regulatory tailwinds, the expected cash balance of Greenbrook at the time of the closing of the proposed Arrangement (as such term is defined in the Neuronetics definitive proxy statement), expectations regarding Neuronetics’ ability to leverage Greenbrook’s assets, the expected composition of the management and the board of directors of the combined company, gross margin and future profitability expectations, and the timing and completion of the Arrangement, including the satisfaction or waiver of all the required conditions thereto. These forward-looking statements are based upon the current beliefs and expectations of the management of Neuronetics and are subject to known and unknown risks and uncertainties. Factors that could cause actual events to differ include, but are not limited to:
| | • | | the inherent uncertainty associated with financial or other projections or outlooks, including due to the unpredictability of the underlying assumptions, adjustments and estimates; |
| | • | | Neuronetics’ ability to maintain the listing requirements of Nasdaq; |
| | • | | the total addressable market of Neuronetics’ and Greenbrook’s businesses; |
| | • | | general economic conditions in the markets where Neuronetics and Greenbrook operate; |
| | • | | the expected timing of any regulatory approvals relating to the Arrangement, the businesses of Greenbrook and Neuronetics and of the combined company and product launches of such businesses and companies; |
| | • | | the non-performance of third-party vendors and contractors; |
