AYTU AYTU BioPharma Inc

Item 1.01 Entry into a Material Definitive Agreement.

On March 19, 2020, Aytu BioScience, Inc. (the “Company”) entered into a securities purchase agreement (the “Purchase Agreement”) with certain institutional investors (the “Purchasers”), pursuant to which the Company agreed to sell and issue, in a registered direct offering, an aggregate of (i) 12,539,197 shares of the Company’s common stock (the “Common Stock”) at a purchase price per share of $1.595 (the “Shares”) and (ii) warrants to purchase up to 12,539,197 shares of Common Stock (the “Warrants”) at an exercise price of $1.47 per share, for aggregate gross proceeds to the Company of $20.0 million, before deducting placement agent fees and other offering expenses payable by the Company (the “Registered Offering”). The Warrants are exercisable immediately upon issuance and have a term of one year from the issuance date. The Shares and Warrants are being offered by the Company pursuant to an effective shelf registration statement on Form S-3, which was originally filed with the Securities and Exchange Commission (the “SEC”) on November 22, 2017, as amended, and was declared effective on December 1, 2017 (File No. 333-221735) (the “Registration Statement”) and a prospectus supplement thereunder. The Registered Offering is expected to close on or about March 23, 2020, subject to satisfaction of customer closing conditions.

Pursuant to a letter agreement dated as of January 3, 2020, as amended, the Company engaged H.C. Wainwright & Co., LLC (“Wainwright”) to act as its exclusive placement agent in connection with the Registered Offering. The Company has agreed to pay Wainwright 7.5% of the aggregate gross proceeds in the Registered Offering, excluding the proceeds, if any, from the exercise of the Warrants. The Company also agreed to pay Wainwright a management fee of 1.0% of the aggregate gross proceeds in the Registered Offering and to pay Wainwright certain non-accountable expenses of $90,000 and a clearing fee of $12,900. In addition, the Company also agreed to issue to the placement agent (or its designees) warrants to purchase up to 815,047 shares of common stock (the “Placement Agent Warrants”) as part of the compensation payable to it. The Placement Agent Warrants will be substantially on the same terms as the Warrants, except that the Placement Agent Warrants will have an exercise price of $1.9938 per share.

The foregoing descriptions of the Purchase Agreement, the Warrants and the Placement Agent Warrants are not complete and are qualified in their entireties by reference to the full text of the Purchase Agreement, the Warrants and the Placement Agent Warrants, copies of which are filed herewith as Exhibit 10.1, Exhibit 4.1, Exhibit 4.2, respectively, to this Current Report on Form 8-K and are incorporated by reference herein. On March 19, 2020, the Company also issued a press release announcing the Registered Offering. A copy of the press release is attached as Exhibit 99.1 hereto.

A copy of the legal opinion of Dorsey & Whitney LLP relating to the Shares, the Warrants, the Placement Agent Warrants and the shares of common stock underlying the Warrants and the Placement Agent Warrants is attached as Exhibit 5.1 hereto.