Item 1.01 Entry into a Material Definitive Agreement
On August 30, 2019, Zynerba Pharmaceuticals, Inc. (the Company) entered into a Controlled Equity OfferingSM Sales Agreement (the Agreement) with Cantor Fitzgerald & Co., Canaccord Genuity LLC, H.C. Wainwright & Co., LLC and Ladenburg Thalmann & Co. Inc., as sales agents (the Agents), pursuant to which the Company may, from time to time, issue and sell shares of its common stock, par value $0.001 per share, in an aggregate offering price of up to $75.0 million (the Shares).
Under the terms of the Agreement, the Agents may sell the Shares at market prices by any method that is deemed to be an at the market offering as defined in Rule 415 under the Securities Act, as amended.
The offer and sales of the Shares made pursuant to the Agreement, if any, will be made under the Companys effective shelf registration statement on Form S-3 (File No. 333-233038), the base prospectus contained therein, dated August 13, 2019, and a prospectus supplement related to the offering of the Shares, dated August 30, 2019.
This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of any offer to buy the Shares, nor shall there be an offer, solicitation or sale of the Shares in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state.
The Company is not obligated to, and it cannot provide any assurances that it will, make any sales of the Shares under the Agreement. The Agreement may be terminated by the Agents or the Company at any time upon ten days prior written notice to the Company or the Agents, respectively. The Company will pay the Agents a commission rate of up to 3.0% of the gross sales price per share of any Shares sold through the Agents as sales agents under the Agreement. The Company has also provided the Agents with customary indemnification and contribution rights. The Company has agreed to reimburse the Agents for legal fees and disbursements, not to exceed $50,000 in the aggregate.
The foregoing description of the Agreement is not complete and is qualified in its entirety by reference to the full text of such agreement, a copy of which was filed as Exhibit 10.1 hereto and incorporated herein by reference.
The legal opinion of Pepper Hamilton LLP, counsel to the Company, relating to the Shares is filed as Exhibit 5.1 hereto.