Item 1.01. Entry into Material Definitive
Agreement
On January 15, 2021, Titan Pharmaceuticals,
Inc. (the “Company” or “Titan”) entered into a Securities Purchase Agreement (the “Purchase Agreement”)
with several accredited institutional investors (the “Purchasers”) pursuant to which the Company shall issue to the
Purchasers, in a registered direct offering, an aggregate of 2,725,000 shares (the “Shares”) of the Company’s
common stock, par value $0.001 per share (“Common Stock”), for a purchase price per share of $3.55 for aggregate gross
proceeds to the Company of approximately $9.7 million, before deducting fees to the placement agent and other estimated offering
expenses payable by the Company. The Shares are being offered by the Company pursuant to an effective shelf registration statement
on Form S-3 (File No. 333-230742), which was declared effective on April 24, 2019 (the “Registration Statement”).
Pursuant to the terms of the Purchase Agreement,
Titan has agreed to certain restrictions on future stock offerings, including that during the 45-day period following the closing,
the Company will not issue (or enter into any agreement to issue) any shares of Common Stock or Common Stock equivalents, subject
to certain exceptions, and will not file any registration statements.
In a concurrent private placement, the
Company is also selling to the Purchasers warrants to purchase an aggregate of 2,725,000 shares of Common Stock at an exercise
price of $3.55 (the “Warrants”). The Warrants will be exercisable immediately and will expire five years and six months
following the issuance date. The exercise price of the Warrants and the shares of the Common Stock issuable upon the exercise of
the Warrants (the “Warrant Shares”) will be subject to adjustment in the event of any stock dividends and splits, reverse
stock split, recapitalization, reorganization or similar transaction, as described in the Warrants. The Warrants will be exercisable
on a “cashless” basis in certain circumstances.
The Warrants and the Warrant Shares have
not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and are instead being offered
pursuant to the exemption provided in Section 4(a)(2) under the Securities Act and Rule 506(b) promulgated thereunder. The Company
has agreed to file a registration statement on Form S-1 to register the resale of the Warrant Shares within 30 days of the date
of the Purchase Agreement and to use its commercially reasonable efforts to obtain effectiveness of such registration statement
within 181 days following the closing of the offering.
The Purchasers are “accredited investors”
as defined under the Securities Act. The Purchasers, either alone or together with their respective representatives, have enough
knowledge and experience to be considered sophisticated investors, have access to the type of information normally provided in
a prospectus for a registered securities offering, and have agreed not to resell or distribute the Warrants or the Warrant Shares
to the public except pursuant to an effective registration statement under the Securities Act or an exemption thereto.
Maxim Group LLC acted as the sole placement
agent (the “Placement Agent”) on a “reasonable best efforts” basis, in connection with the offering. A
copy of the Placement Agency Agreement, dated as of January 15, 2021, by and between the Company and the Placement Agent is attached
hereto as Exhibit 10.2 and incorporated herein by reference (the “Placement Agency Agreement”). Pursuant to the Placement
Agency Agreement, the Placement Agent will be entitled to a cash fee of 7% of the gross proceeds paid to Titan for the securities
and reimbursement of certain out-of-pocket expenses.
The foregoing summaries of the offering,
the securities to be issued in connection therewith, the Purchase Agreement, the Placement Agency Agreement and the Warrants do
not purport to be complete and are qualified in their entirety by reference to the definitive transaction documents. Copies of
the form of Purchase Agreement, the Placement Agency Agreement and the form of Warrant are attached hereto as Exhibits 10.1, 10.2
and 4.1, respectively, and are incorporated herein by reference.