Item 8.01. Other Events.
On July 22, 2016,
ContraFect Corporation (the Company or ContraFect) entered into an underwriting agreement (the Underwriting Agreement) with Piper Jaffray & Co., as representative of the several underwriters named therein
(collectively, the Underwriters), relating to the offering, issuance and sale (the Offering) of 14,000,000 shares (the Shares) of the Companys common stock, par value $0.0001 per share (the Common
Stock), and warrants to purchase 14,000,000 shares of Common Stock (the Warrants). The Warrants will be exercisable immediately upon their initial issuance date at an exercise price of $3.00 per share and will expire five years
from the date of issuance. The shares of Common Stock and the Warrants are immediately separable. The exercise price and number of shares of Common Stock issuable upon exercise of the Warrants will be subject to adjustment in the event of stock
dividends, stock splits or similar events affecting the Common Stock. The Company does not intend to list the Warrants on any securities exchange or automated quotation system.
The public offering price in the Offering was $2.50 per Share and accompanying Warrant. The Underwriters have agreed to purchase the Shares and Warrants from
the Company pursuant to the Underwriting Agreement at a price of $2.3375 per Share and accompanying Warrant. The net proceeds to the Company from the Offering are expected to be approximately $32.2 million, assuming no exercise of the Warrants,
after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Offering is expected to close on or about July 27, 2016, subject to customary closing conditions.
The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification
obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the
Underwriting Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties.
The Company intends to use the net proceeds of the Offering to fund the clinical development of its lead product candidate, CF-301, the advancement of its
portfolio, including CF-404 and the discovery of additional product candidates and for working capital and general corporate purposes. The Company believes that its cash, cash equivalents and short-term investments, together with the net proceeds
from the Offering, will fund its operations into the second half of 2018.
The Offering is being made pursuant to the Companys effective shelf
registration statement on Form S-3 (Registration Statement No. 333-211748) previously filed with and declared effective by the Securities and Exchange Commission (the SEC) and a prospectus supplement and accompanying prospectus
filed with the SEC.
Upon closing of the Offering, the Company will enter into a warrant agreement (the Warrant Agreement) with American Stock
Transfer & Trust Company, LLC (the Transfer Agent), pursuant to which the Warrants will be issued and the Transfer Agent will act as warrant agent, registrar and transfer agent for the Warrants. The terms and conditions of the
Warrants are set forth in the Warrant Agreement and the form of Warrant Certificate attached as Exhibit A thereto. The Warrants initially will be represented by one or more permanent global certificates in fully registered form and will be deposited
with a custodian for, and registered in the name of, a nominee of The Depository Trust Company, New York, New York (DTC), as depository.
The foregoing
descriptions of the Underwriting Agreement, the Warrant Agreement and the Warrants are not complete and are qualified in their entireties by reference to the full text of the Underwriting Agreement, the Form of Warrant Agreement and Form of Warrant
Certificate, copies of which are filed as Exhibit 1.1, Exhibit 4.1 and Exhibit 4.2 respectively, to this report and are incorporated by reference herein.
A copy of the opinion of Latham & Watkins LLP relating to the legality of the issuance and sale of the
Shares, the Warrants and the shares of Common Stock issuable upon exercise of the Warrants is attached as Exhibit 5.1 to this report.
Forward-Looking
Statements
This current report contains forward-looking statements within the meaning of the U.S. federal securities laws.
Forward-looking statements can be identified by words such as projects, may, will, could, would, should, believes, expects, anticipates,
estimates, intends, plans, potential, promise or similar references to future periods. Examples of forward-looking statements in this current report include, without limitation, statements
regarding the Companys intent not to list the warrants on a securities exchange or automated quotation system; the anticipated amount of net proceeds from the Offering and the intended use of such proceeds; the anticipated timing of the
closing of the Offering; and the Companys belief that its cash, cash equivalents and short-term investments will fund its operations into the second half of 2018. Forward-looking statements are statements that are not historical facts, nor
assurances of future performance. Instead, they are based on the Companys current beliefs, expectations and assumptions regarding the future of its business, future plans, strategies, projections, anticipated events and trends, the economy and
other future conditions. Because forward-looking statements relate to the future, they are subject to inherent risks and uncertainties, and actual results may differ materially from those set forth in the forward-looking statements. Important
factors that could cause actual results to differ include, without limitation: the Company may list the warrants on a securities exchange or automated quotation system; the amount of and use of net proceeds from the Offering may differ from the
Companys current expectations; the Offering may not close in the timeframe the Company expects, or at all; the Company has incurred significant losses since its inception and may never achieve profitability; the Companys recurring losses
from operations could raise substantial doubt regarding its ability to continue as a going concern; the Company has no product revenues; the Companys short operating history; the Companys need for substantial additional funding; the
Company may be required to suspend or discontinue clinical trials due to adverse side effects or other safety risks; clinical trials of the Companys product candidates are subject to delays, which could result in increased costs and jeopardize
its ability to obtain regulatory approval and commence product sales as currently contemplated; the Companys ability to attract and retain qualified personnel, and changes in management; difficulties in managing the Companys growth; and
the important factors described under the caption Risk Factors in the Companys Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (the SEC) on May 10, 2016 and its other filings with the SEC
for the Offering. Any forward-looking statement made by the Company in this current report is based only on information currently available and speaks only as of the date on which it is made. Except as required by applicable law, the Company
expressly disclaims any obligation to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.