Filed Pursuant to Rule 424(b)(5)
Registration No. 333-220014
PROSPECTUS SUPPLEMENT
(To Prospectus dated
November 9, 2017)
$35,000,000
Common Stock
We have entered into an At Market Issuance Sales
Agreement, or sales agreement, with Stifel, Nicolaus & Company, Incorporated, or Stifel, dated August 2, 2018, relating to the sale of shares of our common stock offered by this prospectus supplement. In accordance with the terms of
the sales agreement, under this prospectus supplement we may offer and sell shares of our common stock, $0.0001 par value per share, having an aggregate offering price of up to $35.0 million from time to time through Stifel, acting as agent.
Sales of our common stock, if any, under this prospectus supplement will be made by any method permitted that is deemed an “at the market
offering” as defined in Rule 415 under the Securities Act of 1933, as amended, or the Securities Act, including sales made directly on or through the Nasdaq Global Market, the existing trading market for our common stock, sales made to or
through a market maker other than on an exchange or otherwise, in negotiated transactions at market prices, and/or any other method permitted by law. Stifel is not required to sell any specific amount, but will act as our sales agent using
commercially reasonable efforts consistent with its normal trading and sales practices. There is no arrangement for funds to be received in any escrow, trust or similar arrangement.
Stifel will be entitled to compensation at a commission rate equal to up to 3% of the gross sales price per share sold. In connection with the sale of the
common stock on our behalf, Stifel may be deemed to be an “underwriter” within the meaning of the Securities Act and the compensation of Stifel may be deemed to be underwriting commissions or discounts. We have also agreed to provide
indemnification and contribution to Stifel with respect to certain liabilities, including liabilities under the Securities Act.
INVESTING IN OUR SECURITIES INVOLVES RISKS. SEE
THE “
RISK FACTORS
” ON PAGE
S-7
OF THIS PROSPECTUS SUPPLEMENT CONCERNING FACTORS YOU SHOULD CONSIDER BEFORE INVESTING IN OUR SECURITIES.
Our common stock is listed on the Nasdaq Global Market under the symbol “CNAT.” On August 1, 2018, the last reported sale price of our common
stock on the Nasdaq Global Market was $3.99 per share.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus supplement or the accompanying base prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus supplement is August 2, 2018.
TABLE OF CONTENTS
Prospectus Supplement
Prospectus
ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus supplement relates to the offering of our common stock. Before buying any of the common stock that we are offering, we urge
you to carefully read this prospectus supplement, together with the accompanying base prospectus and information incorporated by reference as described under the heading “Where You Can Find More Information; Incorporation by Reference.”
These documents contain important information that you should consider when making your investment decision.
We provide information to
you about this offering of our common stock in two separate documents that are bound together: (1) this prospectus supplement, which describes the specific details regarding this offering; and (2) the accompanying base prospectus, which
provides general information, some of which may not apply to this offering. Generally, when we refer to this “prospectus,” we are referring to both documents combined. If information in this prospectus supplement is inconsistent with the
accompanying base prospectus, you should rely on this prospectus supplement. To the extent there is a conflict between the information contained in this prospectus supplement, on the one hand, and the information contained in any document
incorporated by reference in this prospectus supplement, on the other hand, you should rely on the information in this prospectus supplement. If any statement in one of these documents is inconsistent with a statement in another document having a
later date—for example, a document incorporated by reference into this prospectus supplement—the statement in the document having the later date modifies or supersedes the earlier statement.
You should rely only on the information contained in or incorporated by reference in this prospectus supplement and any free writing
prospectus that we may authorize for use in connection with this offering. We have not, and Stifel has not, authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should
not rely on it. We are not, and Stifel is not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted or in which the person making that offer or solicitation is not qualified to do so or to anyone to
whom it is unlawful to make an offer or solicitation. You should assume that the information appearing in this prospectus supplement, the documents incorporated by reference in this prospectus supplement and any free writing prospectus that we have
authorized for use in connection with this offering, is accurate only as of the date of those respective documents. Our business, financial condition, results of operations and prospects may have changed since those dates. You should read this
prospectus supplement, the documents incorporated by reference in this prospectus supplement and any free writing prospectus that we have authorized for use in connection with this offering, in their entirety before making an investment decision.
When we refer to “Conatus,” “we,” “our,” “us” and the “Company” in this prospectus
supplement, we mean Conatus Pharmaceuticals Inc., unless otherwise specified. When we refer to “you,” we mean the holders of the applicable series of securities.
We use our registered trademark, CONATUS PHARMACEUTICALS, in this prospectus supplement. This prospectus supplement also includes trademarks,
tradenames and service marks that are the property of other organizations. Solely for convenience, trademarks and tradenames referred to in this prospectus supplement appear without the
®
and
™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or that the applicable owner will not assert its rights, to these trademarks and
tradenames.
S-1
WHERE YOU CAN FIND MORE INFORMATION; INCORPORATION BY REFERENCE
Available Information
We file
reports, proxy statements and other information with the U.S. Securities and Exchange Commission, or the SEC. Information filed with the SEC by us can be inspected and copied at the Public Reference Room maintained by the SEC at 100 F Street, N.E.,
Washington, D.C. 20549. You may also obtain copies of this information by mail from the Public Reference facilities of the SEC at prescribed rates. Further information on the operation of the SEC’s Public Reference Room in Washington, D.C. can
be obtained by calling the SEC at
1-800-SEC-0330.
The SEC also maintains a web site that contains reports, proxy and information
statements and other information about issuers, such as us, who file electronically with the SEC. The address of that website is
http://www.sec.gov
.
Our web site address is www.conatuspharma.com. The information on our web site, however, is not, and should not be deemed to be, a part of
this prospectus supplement.
This prospectus supplement is part of a registration statement that we filed with the SEC and does not
contain all of the information in the registration statement. The full registration statement may be obtained from the SEC or us, as provided below. Forms of the indenture and other documents establishing the terms of the offered securities are or
may be filed as exhibits to the registration statement. Statements in this prospectus supplement about these documents are summaries and each statement is qualified in all respects by reference to the document to which it refers. You should refer to
the actual documents for a more complete description of the relevant matters. You may inspect a copy of the registration statement at the SEC’s Public Reference Room in Washington, D.C. or through the SEC’s website, as provided above.
Incorporation by Reference
The
SEC’s rules allow us to “incorporate by reference” information into this prospectus supplement, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The
information incorporated by reference is deemed to be part of this prospectus supplement, and subsequent information that we file with the SEC will automatically update and supersede that information. Any statement contained in a previously filed
document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus supplement to the extent that a statement contained in this prospectus supplement modifies or replaces that statement.
We incorporate by reference our documents listed below and any future filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act” in this prospectus supplement, between the date of this prospectus supplement and the termination of the offering of the securities described in
this prospectus supplement. We are not, however, incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not deemed “filed” with the SEC, including our Compensation
Committee report and performance graph or any information furnished pursuant to Items 2.02 or 7.01 of Form
8-K
or related exhibits furnished pursuant to Item 9.01 of Form
8-K.
This prospectus supplement incorporates by reference the documents set forth below that have
previously been filed with the SEC:
|
|
•
|
|
our Annual Report on Form
10-K
for the year ended December 31, 2017,
filed with the SEC on March 8, 2018;
|
|
|
•
|
|
our Quarterly Reports on Form
10-Q
for the quarters ended March 31,
2018 and June 30, 2018, filed with the SEC on May 3, 2018 and August 2, 2018, respectively;
|
|
|
•
|
|
our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 27, 2018;
|
S-2
|
|
•
|
|
our Current Reports on Form
8-K
filed with the SEC on February 5,
2018, April 4, 2018 and June 25, 2018; and
|
|
|
•
|
|
the description of our Common Stock contained in our registration statement on Form
8-A,
filed with the SEC on July 12, 2013 and any amendment or report filed with the SEC for the purpose of updating the description.
|
All reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the
termination of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior to the effectiveness of the registration statement, but excluding any information furnished to, rather
than filed with, the SEC, will also be incorporated by reference into this prospectus supplement and deemed to be part of this prospectus supplement from the date of the filing of such reports and documents.
You may request a free copy of any of the documents incorporated by reference in this prospectus supplement (other than exhibits, unless they
are specifically incorporated by reference in the documents) by writing or telephoning us at the following address:
Conatus
Pharmaceuticals Inc.
Attn: Corporate Secretary
16745 West Bernardo Drive, Suite 200
San Diego, California 92127
(858)
376-2600
S-3
THE COMPANY
Overview
We are a biotechnology company
focused on the development and commercialization of novel medicines to treat liver disease. We are developing emricasan, a
first-in-class,
orally active
pan-caspase
protease inhibitor, for the treatment of patients with chronic liver disease. Emricasan is designed to reduce the activities of human caspases, which are enzymes that mediate inflammation and apoptosis.
We believe that by reducing the activity of these enzymes, caspase inhibitors have the potential to interrupt the progression of a variety of diseases.
We plan to continue advancing toward registration of emricasan for patients with fibrosis or cirrhosis due to nonalcoholic steatohepatitis, or
NASH. Our current clinical program for emricasan includes the following randomized, double-blind, placebo-controlled Phase 2b clinical trials:
|
|
•
|
|
Phase 2b
ENCORE-PH
(Portal Hypertension) Clinical Trial
: In
November 2016, we initiated a clinical trial to evaluate the effect of emricasan in approximately 240 compensated or early decompensated NASH cirrhosis patients with severe portal hypertension.
Top-line
results are expected in the fourth quarter of 2018. In addition, this trial has a
24-week
treatment extension that is intended to further evaluate clinical outcomes.
|
|
|
•
|
|
Phase 2b
ENCORE-NF
(NASH Fibrosis) Clinical Trial
: In
January 2016, we initiated a clinical trial to evaluate emricasan in approximately 330 patients with liver fibrosis resulting from NASH.
Top-line
results are expected in the first half of 2019.
|
|
|
•
|
|
Phase 2b
ENCORE-LF
(Liver Function) Clinical Trial
: In May
2017, we initiated a clinical trial to evaluate emricasan in approximately 210 patients with decompensated NASH cirrhosis.
Top-line
results are expected in the second half of 2019.
|
In April 2018, we announced
top-line
results from our exploratory Phase 2b
POLT-HCV-SVR
proof-of-concept
clinical trial of emricasan in post-orthotopic liver transplant,
or POLT, recipients with reestablished liver fibrosis post-transplant as a result of recurrent hepatitis C virus, or HCV, infection who have successfully achieved a sustained viral response, or SVR, following HCV antiviral therapy, or
POLT-HCV-SVR
patients, with residual fibrosis or cirrhosis. Although the trial did not meet its primary endpoint in the heterogeneous overall trial population, emricasan
provided evidence of an anti-fibrotic treatment effect in the subgroup of patients with advanced fibrosis and early cirrhosis.
In
February 2018, we initiated a
non-treatment
observational study pursuant to which subjects from the four trials above will be followed for an up to three-year safety
follow-up.
In May 2017, Novartis Pharma AG, or Novartis, exercised its option under the Option,
Collaboration and License Agreement, or the Collaboration Agreement, we entered into with Novartis in December 2016. Pursuant to such exercise, we granted Novartis an exclusive, worldwide license to our intellectual property rights relating to
emricasan to collaborate with us for the global development and commercialization of products containing emricasan either as a single active ingredient or in combination with other Novartis compounds for liver cirrhosis or liver fibrosis for the
treatment, diagnosis and prevention of disease in all indications in humans. The license became effective upon our receipt of a $7.0 million option exercise payment in July 2017.
Pursuant to the Collaboration Agreement, we are responsible for completing the three ENCORE trials described above. We share the costs of the
ENCORE trials equally with Novartis. In addition, until the completion of the ENCORE trials, we will equally share the costs of the
non-treatment
observational study. After the completion of the ENCORE trials,
Novartis will assume 100% of the observational study costs. Novartis is responsible for 100% of certain expenses for required registration-supportive nonclinical activities. Novartis is also responsible for the development of emricasan beyond the
ENCORE trials and the observational study
S-4
described above, including the Phase 3 development of emricasan single agent products and all development for emricasan combination products, and Novartis has agreed to use commercially
reasonable efforts to develop and commercialize emricasan products. A joint steering committee comprised of representatives from our company and Novartis oversees the collaboration, development and commercialization of emricasan products.
Under the Collaboration Agreement, Novartis paid us an upfront payment of $50.0 million and the option exercise payment of
$7.0 million. In addition, we are eligible to receive up to an aggregate of $650.0 million in milestone payments, as well as royalties.
We also plan to expand our development pipeline by internally developing new preclinical product candidates leveraging our expertise with
caspase inhibition and/or by
in-licensing
or acquiring preclinical or clinical product candidates consistent with our product development and regulatory expertise. We will continue to evaluate the potential of
IDN-7314
as a product candidate as a component of our pipeline expansion plans. In addition to liver disease, we may pursue the development of product candidates in other disease areas.
Corporate Information
We were
incorporated under the laws of the state of Delaware in 2005. Our principal executive offices are located at 16745 West Bernardo Drive, Suite 200, San Diego, California 92127, and our telephone number is
(858) 376-2600.
S-5
THE OFFERING
|
|
|
|
|
Common stock offered by us pursuant to this prospectus supplement
|
|
Shares of our common stock having an aggregate offering price of up to $35.0 million.
|
|
|
|
|
Manner of offering
|
|
“At the market offering” that may be made from time to time on the Nasdaq Global Market or other market for our common stock in the United States through our agent, Stifel. See the section entitled “Plan of
Distribution” on page
S-12
of this prospectus supplement.
|
|
|
|
|
Use of proceeds
|
|
We intend to use the net proceeds of this offering to fund pipeline development through internally developing new preclinical product candidates and/or by
in-licensing
or acquiring
preclinical or clinical product candidates and for working capital and other general corporate purposes. See the section entitled “Use of Proceeds” on page
S-10
of this prospectus
supplement.
|
|
|
|
|
Risk factors
|
|
See “Risk Factors” beginning on page
S-7
of this prospectus supplement and the other information included in, or incorporated by reference into, this prospectus supplement for a
discussion of certain factors you should carefully consider before deciding to invest in shares of our common stock.
|
|
|
|
|
Nasdaq Global Market symbol
|
|
CNAT
|
S-6
RISK FACTORS
Investment in any securities offered pursuant to this prospectus supplement involves risks. You should carefully consider the risk factors
described below and the risk factors incorporated by reference to our most recent Annual Report on Form
10-K
and any subsequent Quarterly Reports on Form
10-Q
or Current
Reports on Form
8-K
we file after the date of this prospectus supplement, and all other information contained or incorporated by reference into this prospectus supplement, as updated by our subsequent filings
under the Exchange Act, before acquiring any of such securities. The occurrence of any of these risks might cause you to lose all or part of your investment in the offered securities.
Risks Relating to this Offering
If
you purchase shares of our common stock sold in this offering, you will experience immediate and substantial dilution in the net tangible book value of your shares. In addition, we may issue additional equity or convertible debt securities in the
future, which may result in additional dilution to investors.
The price per share of our common stock being offered may be higher
than the net tangible book value per share of our outstanding common stock prior to this offering. Assuming that an aggregate of 8,771,929 shares of our common stock are sold at a price of $3.99 per share, the last reported sale price of
our common stock on the Nasdaq Global Market on August 1, 2018, for aggregate gross proceeds of approximately $35.0 million, and after deducting commissions and estimated offering expenses payable by us, new investors in this offering will
incur immediate dilution of $2.60 per share. For a more detailed discussion of the foregoing, see the section entitled “Dilution” below. To the extent outstanding stock options or warrants are exercised, there will be further dilution
to new investors. In addition, to the extent we need to raise additional capital in the future and we issue additional shares of common stock or securities convertible or exchangeable for our common stock, our then existing stockholders may
experience dilution and the new securities may have rights senior to those of our common stock offered in this offering.
We have broad
discretion in the use of the net proceeds from this offering and may not use them effectively.
Our management will have broad
discretion in the application of the net proceeds from this offering, including for any of the purposes described in the section entitled “Use of Proceeds,” and you will not have the opportunity as part of your investment decision to
assess whether the net proceeds are being used appropriately. Because of the number and variability of factors that will determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently
intended use. Our management might not apply our net proceeds in ways that ultimately increase the value of your investment. We expect to use the net proceeds from this offering to fund the development of new internal preclinical product candidates
and/or to
in-license
or acquire preclinical or clinical product candidates and for working capital and other general corporate purposes. The failure by our management to apply these funds effectively could
harm our business. Pending their use, we may invest the net proceeds from this offering in short-term, investment-grade, interest-bearing securities. These investments may not yield a favorable return to our stockholders. If we do not invest or
apply the net proceeds from this offering in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline.
Future sales of substantial amounts of our common stock, or the possibility that such sales could occur, could adversely affect the market
price of our common stock.
We may issue up to $35.0 million of common stock from time to time in this offering. The issuance
from time to time of shares in this offering, as well as the fact that we have the ability to issue such shares in this offering, could have the effect of depressing the market price or increasing the market price volatility of our common stock.
S-7
It is not possible to predict the actual number of shares we will sell under the sales
agreement, or the gross proceeds resulting from those sales.
Subject to certain limitations in the sales agreement and compliance
with applicable law, we have the discretion to deliver a placement notice to Stifel at any time throughout the term of the sales agreement. The number of shares that are sold through Stifel after delivering a placement notice will fluctuate based on
a number of factors, including the market price of our common stock during the sales period, the limits we set with Stifel in any applicable placement notice, and the demand for our common stock during the sales period. Because the price per share
of each share sold will fluctuate during this offering, it is not currently possible to predict the number of shares that will be sold or the gross proceeds to be raised in connection with those sales.
The common stock offered hereby will be sold in “at the market offerings”, and investors who buy shares at different times will
likely pay different prices.
Investors who purchase shares in this offering at different times will likely pay different prices, and
so may experience different levels of dilution and different outcomes in their investment results. We will have discretion, subject to market demand, to vary the timing, prices, and numbers of shares sold in this offering. In addition, subject to
the final determination by our board of directors, there is no minimum or maximum sales price for shares to be sold in this offering. Investors may experience a decline in the value of the shares they purchase in this offering as a result of sales
made at prices lower than the prices they paid.
S-8
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus supplement and the documents incorporated by reference herein contain forward-looking statements. All statements other than
statements of historical facts contained in this prospectus supplement and the documents incorporated by reference herein are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors
that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. This prospectus supplement and the documents
incorporated by reference herein also contain estimates and other statistical data made by independent parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions and
limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates of our future performance and the future performance of the markets in which we operate are necessarily subject to a
high degree of uncertainty and risk.
In some cases, you can identify forward-looking statements by terms such as “may,”
“will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,”
“estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this prospectus supplement and the documents incorporated by
reference herein are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and
results of operations. These forward- looking statements speak only as of the date of this prospectus supplement and are subject to a number of risks, uncertainties and assumptions, including those under “Risk Factors” and elsewhere in
this prospectus supplement. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate
in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Except as required by applicable law, we do not plan to publicly update
or revise any forward-looking statements contained in this prospectus supplement or the documents incorporated by reference herein, whether as a result of any new information, future events, changed circumstances or otherwise.
S-9
USE OF PROCEEDS
We may issue and sell shares of our common stock having aggregate sales proceeds of up to $35.0 million from time to time. Because there
is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable at this time.
We intend to use the net proceeds of this offering to fund pipeline development through internally developing new preclinical product
candidates and/or by
in-licensing
or acquiring preclinical or clinical product candidates and for working capital and other general corporate purposes.
The amounts and timing of our actual expenditures will depend on numerous factors, including the progress of our internal development
activities, availability of product candidates for
in-licensing
or acquiring and other factors described under “Risk Factors” in this prospectus supplement and in the documents incorporated by
reference herein, as well as the amount of cash used in our operations. We may find it necessary or advisable to use the net proceeds for other purposes, and we will have broad discretion in the application of the net proceeds. Pending the uses
described above, we plan to invest the net proceeds from this offering in short- and intermediate-term, interest-bearing obligations, investment-grade instruments, certificates of deposit or direct or guaranteed obligations of the U.S. government.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our capital stock. We intend to retain future earnings, if any, to finance the operation
of our business and do not anticipate paying any cash dividends in the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition,
results of operations, capital requirements, business prospects and other factors the board of directors deems relevant, and subject to the restrictions contained in any future financing instruments.
S-10
DILUTION
If you invest in our common stock, your interest will be diluted to the extent of the difference between the price per share you pay in this
offering and the net tangible book value per share of our common stock immediately after this offering. Our net tangible book value of our common stock as of June 30, 2018 was approximately $20.0 million, or approximately $0.66 per share
of common stock based upon 30,144,799 shares outstanding. Net tangible book value per share is equal to our total tangible assets, less our total liabilities, divided by the total number of shares outstanding as of June 30, 2018.
After giving effect to the sale of our common stock in the aggregate amount of $35.0 million at an assumed offering price of $3.99 per
share, the last reported sale price of our common stock on the Nasdaq Global Market on August 1, 2018, and after deducting estimated offering commissions and estimated offering expenses payable by us, our net tangible book value as of
June 30, 2018 would have been $54.2 million, or $1.39 per share of common stock. This represents an immediate increase in net tangible book value of $0.73 per share to our existing stockholders and an immediate dilution in net tangible book
value of $2.60 per share to new investors in this offering.
The following table illustrates this calculation on a per share basis:
|
|
|
|
|
|
|
Assumed public offering price per share
|
|
$
|
3.99
|
|
|
Net tangible book value per share
|
|
$
|
0.66
|
|
|
Increase in net tangible book value per share attributable to the offering
|
|
$
|
0.73
|
|
|
As adjusted net tangible book value per share after giving effect to the offering
|
|
$
|
1.39
|
|
|
Dilution in net tangible book value per share to new investors in this offering
|
|
$
|
2.60
|
|
The number of shares of our common stock to be outstanding immediately after this offering is based on
30,144,799 shares of our common stock outstanding as of June 30, 2018. The number of shares outstanding as of June 30, 2018 excludes:
|
|
•
|
|
5,527,901 shares of common stock issuable upon exercise of stock options outstanding as of June 30, 2018, at
a weighted exercise price of $5.15 per share;
|
|
|
•
|
|
817,733 shares of common stock reserved for future issuance under our 2013 incentive award plan;
|
|
|
•
|
|
515,667 shares of common stock reserved for future issuance under our 2013 employee stock purchase plan;
|
|
|
•
|
|
13,468 shares of common stock issuable upon exercise of warrants outstanding as of June 30, 2018, at a
weighted average exercise price of $7.43 per share; and
|
|
|
•
|
|
2,845,609 shares of common stock issuable as of June 30, 2018 upon the optional conversion of a convertible
promissory note in the principal amount of $15.0 million (including accrued interest of $1.2 million thereon) that we issued to Novartis Pharma AG, or Novartis, in February 2017, at a price per share equal to 120% of the
20-day
trailing average closing price per share of the common stock leading up to June 30, 2018.
|
The foregoing table does not give effect to the exercise of any outstanding options or warrants or the conversion of the promissory note
issued to Novartis. To the extent such options or warrants are exercised or such promissory note is converted, there may be further dilution to new investors.
S-11
PLAN OF DISTRIBUTION
We have entered into an At Market Issuance Sales Agreement with Stifel under which we may issue and sell our common stock from time to time
through Stifel acting as agent, subject to certain limitations, including the number of shares registered under the registration statement to which the offering relates. The sales, if any, of shares made under the sales agreement will be made by any
method that is deemed an “at the market offering” as defined in Rule 415 promulgated under the Securities Act, including sales made directly on or through the Nasdaq Global Market, the existing trading market for our common stock, sales
made to or through a market maker other than on an exchange or otherwise, in negotiated transactions at market prices, and/or any other method permitted by law. We may instruct Stifel not to sell common stock if the sales cannot be effected at or
above the price designated by us from time to time. We or Stifel may suspend the offering of common stock upon notice and subject to other conditions.
Each time we wish to issue and sell common stock under the sales agreement, we will notify Stifel of the number of shares to be issued, the
dates on which such sales are anticipated to be made, any minimum price below which sales may not be made and other sales parameters as we deem appropriate. Once we have so instructed Stifel, unless Stifel declines to accept the terms of the notice,
Stifel has agreed to use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such shares up to the amount specified on such terms. The obligations of Stifel under the sales agreement to sell our common
stock are subject to a number of conditions that we must meet.
We will pay Stifel commissions for its services in acting as agent in the
sale of common stock. Stifel will be paid a commission in an amount equal to up to 3.0% of the gross sales price per share sold. In addition, we have agreed to reimburse Stifel for fees and disbursements related to its legal counsel in an amount not
to exceed $50,000, and for certain other expenses. We estimate that the total expenses for the offering, excluding compensation payable to Stifel under the terms of the sales agreement, will be approximately $130,000.
Settlement for sales of common stock will generally occur on the second business day following the date on which any sales are made, or on
some other date that is agreed upon by us and Stifel in connection with a particular transaction, in return for payment of the net proceeds to us. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.
We will report at least quarterly the number of shares of common stock sold through Stifel, as sales agent, under the sales agreement, the net
proceeds to us and the compensation paid by us to Stifel in connection with the sales of our common stock.
In connection with the sale of
the common stock on our behalf, Stifel may, and will with respect to sales effected in an “at the market offering,” be deemed to be an “underwriter” within the meaning of the Securities Act and the compensation of Stifel may be
deemed to be underwriting commissions or discounts. We have agreed to provide indemnification and contribution to Stifel against certain civil liabilities, including liabilities under the Securities Act. We have also agreed to reimburse Stifel for
certain other specified expenses.
The offering of our common stock pursuant to the sales agreement will terminate upon the earlier of
(i) the sale of all of our common stock provided for in this prospectus supplement or (ii) termination of the sales agreement as provided therein.
Stifel and its affiliates have in the past provided, and may in the future provide, various investment banking and other financial services
for us and our affiliates, for which services they may in the future receive customary fees. To the extent required by Regulation M, Stifel will not engage in any market making activities involving our common stock while the offering is ongoing
under this prospectus supplement.
S-12
LEGAL MATTERS
Latham & Watkins LLP, San Diego, California, will pass upon certain legal matters relating to the issuance and sale of the securities
offered hereby on behalf of Conatus Pharmaceuticals Inc. Goodwin Procter LLP, New York, New York, is counsel for Stifel in connection with this offering.
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our
Annual Report on Form
10-K
for the year ended December 31, 2017, as set forth in their report, which is incorporated by reference in this prospectus supplement and elsewhere in the registration statement.
Our financial statements are incorporated by reference in reliance on Ernst & Young LLP’s report, given on their authority as experts in accounting and auditing.
S-13
PROSPECTUS
$100,000,000
Common Stock
Preferred
Stock
Debt Securities
Warrants
Units
We may offer and sell up to $100.0 million in the aggregate of the securities identified above from time to time in one or more offerings.
This prospectus provides you with a general description of the securities.
Each time we offer and sell securities, we will provide a
supplement to this prospectus that contains specific information about the offering and the amounts, prices and terms of the securities. The supplement may also add, update or change information contained in this prospectus with respect to that
offering. You should carefully read this prospectus and the applicable prospectus supplement before you invest in any of our securities.
We may offer and sell the securities described in this prospectus and any prospectus supplement to or through one or more underwriters,
dealers and agents, or directly to purchasers, or through a combination of these methods. If any underwriters, dealers or agents are involved in the sale of any of the securities, their names and any applicable purchase price, fee, commission or
discount arrangement between or among them will be set forth, or will be calculable from the information set forth, in the applicable prospectus supplement. See the sections of this prospectus entitled “About this Prospectus” and
“Plan of Distribution” for more information. No securities may be sold without delivery of this prospectus and the applicable prospectus supplement describing the method and terms of the offering of such securities.
INVESTING IN OUR SECURITIES INVOLVES RISKS. SEE THE “
RISK FACTORS
” ON PAGE 6 OF THIS PROSPECTUS AND
ANY SIMILAR SECTION CONTAINED IN THE APPLICABLE PROSPECTUS SUPPLEMENT CONCERNING FACTORS YOU SHOULD CONSIDER BEFORE INVESTING IN OUR SECURITIES.
Our common stock is listed on The Nasdaq Global Market under the symbol “CNAT.” On August 16, 2017, the last reported sale
price of our common stock on The Nasdaq Global Market was $5.11 per share.
Neither the Securities and Exchange Commission nor any
state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is November 9, 2017.
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the U.S. Securities and Exchange Commission, or the SEC, using a
“shelf” registration process. By using a shelf registration statement, we may sell securities from time to time and in one or more offerings up to a total dollar amount of $100.0 million as described in this prospectus. Each time that we
offer and sell securities, we will provide a prospectus supplement to this prospectus that contains specific information about the securities being offered and sold and the specific terms of that offering. We may also authorize one or more free
writing prospectuses to be provided to you that may contain material information relating to these offerings. The prospectus supplement may also add, update or change information contained in this prospectus with respect to that offering. If there
is any inconsistency between the information in this prospectus and the applicable prospectus supplement, you should rely on the prospectus supplement. Before purchasing any securities, you should carefully read both this prospectus and the
applicable prospectus supplement, together with the additional information described under the heading “Where You Can Find More Information; Incorporation by Reference.”
We have not authorized anyone to provide you with any information or to make any representations other than those contained in this
prospectus, any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other
information that others may give you. We will not make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the applicable prospectus
supplement to this prospectus is accurate only as of the date on its respective cover, and that any information incorporated by reference is accurate only as of the date of the document incorporated by reference, unless we indicate otherwise. Our
business, financial condition, results of operations and prospects may have changed since those dates. This prospectus incorporates by reference, and any prospectus supplement or free writing prospectus may contain and incorporate by reference,
market data and industry statistics and forecasts that are based on independent industry publications and other publicly available information. Although we believe these sources are reliable, we do not guarantee the accuracy or completeness of this
information and we have not independently verified this information. Although we are not aware of any misstatements regarding the market and industry data presented in this prospectus and the documents incorporated herein by reference, these
estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading “Risk Factors” contained in this prospectus, the applicable prospectus supplement and any related
free writing prospectus, and under similar headings in other documents that are incorporated by reference into this prospectus. Accordingly, investors should not place undue reliance on this information.
When we refer to “Conatus,” “we,” “our,” “us” and the “Company” in this prospectus, we mean
Conatus Pharmaceuticals Inc., unless otherwise specified. When we refer to “you,” we mean the holders of the applicable series of securities.
We use our registered trademark, CONATUS PHARMACEUTICALS, in this prospectus. This prospectus also includes trademarks, tradenames and service
marks that are the property of other organizations. Solely for convenience, trademarks and tradenames referred to in this prospectus appear without the
®
and ™ symbols, but those
references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or that the applicable owner will not assert its rights, to these trademarks and tradenames.
1
WHERE YOU CAN FIND MORE INFORMATION; INCORPORATION BY REFERENCE
Available Information
We file
reports, proxy statements and other information with the SEC. Information filed with the SEC by us can be inspected and copied at the Public Reference Room maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You may also obtain
copies of this information by mail from the Public Reference Room of the SEC at prescribed rates. Further information on the operation of the SEC’s Public Reference Room in Washington, D.C. can be obtained by calling the SEC at 1-800-SEC-0330.
The SEC also maintains a web site that contains reports, proxy and information statements and other information about issuers, such as us, who file electronically with the SEC. The address of that website is
http://www.sec.gov
.
Our web site address is www.conatuspharma.com. The information on our web site, however, is not, and should not be deemed to be, a part of
this prospectus.
This prospectus and any prospectus supplement are part of a registration statement that we filed with the SEC and do not
contain all of the information in the registration statement. The full registration statement may be obtained from the SEC or us, as provided below. Forms of the indenture and other documents establishing the terms of the offered securities are or
may be filed as exhibits to the registration statement. Statements in this prospectus or any prospectus supplement about these documents are summaries and each statement is qualified in all respects by reference to the document to which it refers.
You should refer to the actual documents for a more complete description of the relevant matters. You may inspect a copy of the registration statement at the SEC’s Public Reference Room in Washington, D.C. or through the SEC’s website, as
provided above.
Incorporation by Reference
The SEC’s rules allow us to “incorporate by reference” information into this prospectus, which means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, and subsequent information that we file with the SEC will
automatically update and supersede that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus modifies or replaces that statement.
We incorporate by reference our documents listed below and any future
filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act” in this prospectus, between the date of this prospectus and the
termination of the offering of the securities described in this prospectus. We are not, however, incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not deemed
“filed” with the SEC, including our Compensation Committee report and performance graph or any information furnished pursuant to Items 2.02 or 7.01 of Form 8-K or related exhibits furnished pursuant to Item 9.01 of Form 8-K.
This prospectus and any accompanying prospectus supplement incorporate by reference the documents set forth below that have previously been
filed with the SEC:
|
|
•
|
|
our Annual Report on Form 10-K for the year ended December 31, 2016, filed with the SEC on March 16,
2017;
|
|
|
•
|
|
our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017, filed with
the SEC on May 5, 2017 and August 4, 2017, respectively;
|
|
|
•
|
|
our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 28, 2017;
|
|
|
•
|
|
our Current Reports on Form 8-K filed with the SEC on January 26, 2017, February 1,
2017, February 7, 2017, February 16, 2017, February 17, 2017, March 21, 2017, May 4, 2017, May 11, 2017, June 26, 2017 and July 6, 2017; and
|
2
|
|
•
|
|
the description of our Common Stock contained in our registration statement on Form 8-A, filed with the SEC on
July 12, 2013 and any amendment or report filed with the SEC for the purpose of updating the description.
|
All
reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering, including all such documents we may file with the SEC after the date of the initial
registration statement and prior to the effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will also be incorporated by reference into this prospectus and deemed to be part of
this prospectus from the date of the filing of such reports and documents.
You may request a free copy of any of the documents
incorporated by reference in this prospectus (other than exhibits, unless they are specifically incorporated by reference in the documents) by writing or telephoning us at the following address:
Conatus Pharmaceuticals Inc.
Attn: Corporate Secretary
16745
West Bernardo Drive, Suite 200
San Diego, California 92127
(858) 376-2600
Exhibits to the
filings will not be sent, however, unless those exhibits have specifically been incorporated by reference in this prospectus and any accompanying prospectus supplement.
3
THE COMPANY
We are a biotechnology company focused on the development and commercialization of novel medicines to treat liver disease. We are developing
emricasan, a first-in-class, orally active pan-caspase protease inhibitor, for the treatment of patients with chronic liver disease. Emricasan is designed to reduce the activities of human caspases, which are enzymes that mediate inflammation and
apoptosis. We believe that by reducing the activity of these enzymes, caspase inhibitors have the potential to interrupt the progression of a variety of diseases.
We plan to continue advancing toward initial registration of emricasan for patients with cirrhosis due to nonalcoholic steatohepatitis, or
NASH, with parallel development toward registration of emricasan for patients with NASH fibrosis. Our current clinical program for emricasan includes the following randomized, double-blind, placebo-controlled Phase 2b clinical trials:
|
|
•
|
|
Phase 2b ENCORE-PH (Portal Hypertension) Clinical Trial
: In November 2016, we initiated a clinical trial
to evaluate the effect of emricasan in approximately 240 compensated or early decompensated NASH cirrhosis patients with severe portal hypertension. Top-line results are expected in 2018.
|
|
|
•
|
|
Phase 2b ENCORE-LF (Liver Function) Clinical Trial
: In May 2017, we initiated a clinical trial to evaluate
emricasan in approximately 210 patients with decompensated NASH cirrhosis. Top-line results are expected in 2019.
|
|
|
•
|
|
Phase 2b ENCORE-NF (NASH Fibrosis) Clinical Trial
: In January 2016, we initiated a clinical trial to
evaluate emricasan in approximately 330 patients with liver fibrosis resulting from NASH. Top-line results are expected in the first half of 2019.
|
|
|
•
|
|
Phase 2b POLT-HCV-SVR Clinical Trial
: In May 2014, we initiated a clinical trial in approximately
60 post-orthotopic liver transplant, or POLT, recipients with reestablished liver fibrosis post-transplant as a result of recurrent hepatitis C virus, or HCV, infection who have successfully achieved a sustained viral response, or SVR,
following HCV antiviral therapy, or POLT-HCV-SVR, patients with residual fibrosis or cirrhosis, classified as Ishak Fibrosis Score 2-6. Top-line results are expected in the first half of 2018.
|
In May 2017, Novartis Pharma AG, or Novartis, exercised its option under the Option, Collaboration and License Agreement, or the Collaboration
Agreement, we entered into with Novartis in December 2016. Pursuant to such exercise, we granted Novartis an exclusive, worldwide license to our intellectual property rights relating to emricasan to collaborate with us and develop and commercialize
emricasan products, containing emricasan either as a single active ingredient or in combination with other Novartis compounds for liver cirrhosis or liver fibrosis, for the treatment, diagnosis and prevention of disease in all indications in humans.
The license became effective upon our receipt of a $7.0 million option exercise payment in July 2017.
Pursuant to the Collaboration
Agreement, we are responsible for completing the three ENCORE trials and the POLT-HCV-SVR trial described above. We and Novartis will share the costs of these four Phase 2b trials equally. Novartis is responsible for 100% of certain expenses for
required registration-supportive nonclinical activities. Novartis is also responsible for the development of emricasan beyond the four Phase 2b trials described above, including the Phase 3 development of emricasan single agent products and all
development for emricasan combination products, and Novartis has agreed to use commercially reasonable efforts to develop and commercialize emricasan products. A joint steering committee comprised of representatives from our company and Novartis
oversees the collaboration, development and commercialization of emricasan products.
Under the Collaboration Agreement, Novartis paid us
an upfront payment of $50.0 million and an option exercise payment of $7.0 million. In addition, we are eligible to receive up to an aggregate of $650.0 million in milestone payments, as well as royalties.
We also plan to expand our development pipeline by developing our existing preclinical product candidates, developing new product candidates,
or purchasing or in-licensing product candidates. In addition to liver disease,
4
we may pursue the development of product candidates in other disease areas. In June 2017, the U.S. Food and Drug Administration granted Orphan Drug Designation to our preclinical product
candidate IDN-7314, a pan-caspase inhibitor, for the treatment of primary sclerosing cholangitis, a disease affecting bile ducts in the liver, which can lead to cirrhosis and liver failure. We believe the Orphan Drug Designation provides a potential
opportunity to address an important unmet medical need and expand our development pipeline beyond emricasan. We will continue to evaluate the potential of IDN-7314 as a product candidate, along with other product candidate opportunities, and we plan
to announce initial pipeline expansion plans later in 2017.
We were incorporated under the laws of the state of Delaware in 2005. Our
principal executive offices are located at 16745 West Bernardo Drive, Suite 200, San Diego, California 92127, and our telephone number is (858) 376-2600.
5
RISK FACTORS
Investment in any securities offered pursuant to this prospectus and the applicable prospectus supplement involves risks. You should carefully
consider the risk factors incorporated by reference to our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K we file after the date of this prospectus, and all other
information contained or incorporated by reference into this prospectus, as updated by our subsequent filings under the Exchange Act, and the risk factors and other information contained in the applicable prospectus supplement before acquiring any
of such securities. The occurrence of any of these risks might cause you to lose all or part of your investment in the offered securities.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference herein contain forward-looking statements. All statements other than statements of
historical facts contained in this prospectus and the documents incorporated by reference herein are forward-looking statements, including statements regarding our future results of operations and financial position, business strategy, prospective
products, product approvals, research and development costs, timing and likelihood of success, plans and objectives of management for future operations and future results of anticipated products. These statements involve known and unknown risks,
uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the
forward-looking
statements. This prospectus and the documents incorporated by reference herein also contain estimates and other statistical data made by independent parties and by us relating to market size
and growth and other data about our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates of our future performance
and the future performance of the markets in which we operate are necessarily subject to a high degree of uncertainty and risk.
In some
cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,”
“project,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. The
forward-looking
statements in this prospectus and the documents incorporated by reference herein are only predictions. We have based these forward-looking statements largely on our current expectations and
projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this prospectus and are subject to a number of
risks, uncertainties and assumptions, which we discuss in greater detail in the documents incorporated by reference herein, including under the heading “Risk Factors” and elsewhere in this prospectus. The events and circumstances reflected
in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may
emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by
applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this prospectus or the documents incorporated by reference herein, whether as a result of any new information, future events, changed
circumstances or otherwise. For all forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
6
USE OF PROCEEDS
We intend to use the net proceeds from the sale of the securities as set forth in the applicable prospectus supplement.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our capital stock. We currently anticipate that we will retain future earnings, if any,
for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our board
of directors after considering our financial condition, results of operations, capital requirements, business prospects and other factors the board of directors deems relevant, and subject to the restrictions contained in any future financing
instruments.
7
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed charges for Conatus for the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
Six Months
Ended
June 30, 2017
|
|
|
|
2012
|
|
|
2013
|
|
|
2014
|
|
|
2015
|
|
|
2016
|
|
|
Ratio of earnings to fixed charges (1)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
Our earnings were inadequate to cover fixed charges for the years ended December 31, 2012, 2013, 2014,
2015 and 2016 by $8.7 million, $15.6 million, $22.3 million, $24.1 million, and $29.7 million, respectively, and by $9.0 million for the six months ended June 30, 2017.
|
For purposes of calculating the ratio of earnings to fixed charges, earnings represent net income (loss) before provision for income taxes
plus fixed charges. Fixed charges consist of interest expense, the remeasurement of convertible debt to fair value, and an estimate of the interest factor inherent in our operating leases. The portion of total rental expense that represents the
interest factor is estimated to be 4%.
For the periods indicated above, we had no outstanding shares of preferred stock with required
dividend payments. Therefore, the ratios of earnings to combined fixed charges and preferred stock dividends are identical to the ratios presented in the tables above.
8
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is not complete and may not contain all the information you should consider before investing in
our capital stock. This description is summarized from, and qualified in its entirety by reference to, our amended and restated certificate of incorporation, which has been publicly filed with the SEC. See “Where You Can Find More Information;
Incorporation by Reference.”
Our authorized capital stock consists of:
|
|
•
|
|
200,000,000 shares of common stock, $0.0001 par value; and
|
|
|
•
|
|
10,000,000 shares of preferred stock, $0.0001 par value.
|
Common Stock
As of June 30, 2017,
there were 29,994,275 shares of our common stock outstanding and held of record by 27 stockholders. Under the terms of our amended and restated certificate of incorporation, holders of our common stock are entitled to one vote for each share held on
all matters submitted to a vote of stockholders, including the election of directors, and do not have cumulative voting rights. Accordingly, the holders of a majority of the outstanding shares of common stock entitled to vote in any election of
directors can elect all of the directors standing for election, if they so choose, other than any directors that holders of any preferred stock we may issue may be entitled to elect. Subject to preferences that may be applicable to any then
outstanding preferred stock, holders of common stock are entitled to receive ratably those dividends, if any, as may be declared by the board of directors out of legally available funds. In the event of our liquidation, dissolution or winding up,
the holders of common stock will be entitled to share ratably in the assets legally available for distribution to stockholders after the payment of or provision for all of our debts and other liabilities, subject to the prior rights of any preferred
stock then outstanding. Holders of common stock have no preemptive or conversion rights or other subscription rights and there are no redemption or sinking funds provisions applicable to the common stock. All outstanding shares of common stock are
duly authorized, validly issued, fully paid and nonassessable. The rights, preferences and privileges of holders of common stock are subject to and may be adversely affected by the rights of the holders of shares of any series of preferred stock
that we may designate and issue in the future.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.
Preferred Stock
We currently have no
outstanding shares of preferred stock. Under the terms of our amended and restated certificate of incorporation, our board of directors has the authority, without further action by our stockholders, to issue up to 10,000,000 shares of preferred
stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the dividend, voting and other rights, preferences and privileges of the shares of each wholly unissued series and any
qualifications, limitations or restrictions thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding. Prior to the issuance of shares of each series, the board
of directors is required by the General Corporation Law of the State of Delaware, or the DGCL, and our amended and restated certificate of incorporation to adopt resolutions and file a certificate of designation with the Secretary of State of the
State of Delaware. The certificate of designation fixes for each class or series the designations, powers, preferences, rights, qualifications, limitations and restrictions, including dividend rights, conversion rights, redemption privileges and
liquidation preferences.
All shares of preferred stock offered by this prospectus will, when issued, be fully paid and nonassessable and
will not have any preemptive or similar rights. Our board of directors may authorize the issuance of preferred
9
stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of the common stock. The issuance of preferred stock, while providing
flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in our control and may adversely affect the market price of the common stock
and the voting and other rights of the holders of common stock.
We will describe in a prospectus supplement relating to the class or
series of preferred stock being offered the following terms:
|
|
•
|
|
the title and stated value of the preferred stock;
|
|
|
•
|
|
the number of shares of the preferred stock offered, the liquidation preference per share and the offering price
of the preferred stock;
|
|
|
•
|
|
the dividend rate(s), period(s) or payment date(s) or method(s) of calculation applicable to the preferred stock;
|
|
|
•
|
|
whether dividends are cumulative or non-cumulative and, if cumulative, the date from which dividends on the
preferred stock will accumulate;
|
|
|
•
|
|
the procedures for any auction and remarketing, if any, for the preferred stock;
|
|
|
•
|
|
the provisions for a sinking fund, if any, for the preferred stock;
|
|
|
•
|
|
the provision for redemption, if applicable, of the preferred stock;
|
|
|
•
|
|
any listing of the preferred stock on any securities exchange;
|
|
|
•
|
|
the terms and conditions, if applicable, upon which the preferred stock will be convertible into common stock,
including the conversion price or manner of calculation and conversion period;
|
|
|
•
|
|
voting rights, if any, of the preferred stock;
|
|
|
•
|
|
a discussion of any material or special U.S. federal income tax considerations applicable to the preferred stock;
|
|
|
•
|
|
the relative ranking and preferences of the preferred stock as to dividend rights and rights upon the
liquidation, dissolution or winding up of our affairs;
|
|
|
•
|
|
any limitations on issuance of any class or series of preferred stock ranking senior to or on a parity with the
class or series of preferred stock as to dividend rights and rights upon liquidation, dissolution or winding up of our affairs; and
|
|
|
•
|
|
any other specific terms, preferences, rights, limitations or restrictions of the preferred stock.
|
Unless we specify otherwise in the applicable prospectus supplement, the preferred stock will rank, relating to
dividends and upon our liquidation, dissolution or winding up:
|
|
•
|
|
senior to all classes or series of our common stock and to all of our equity securities ranking junior to the
preferred stock;
|
|
|
•
|
|
on a parity with all of our equity securities the terms of which specifically provide that the equity securities
rank on a parity with the preferred stock; and
|
|
|
•
|
|
junior to all of our equity securities the terms of which specifically provide that the equity securities rank
senior to the preferred stock.
|
The term equity securities does not include convertible debt securities.
Warrants
As of June 30, 2017, there
were outstanding warrants to purchase 149,704 shares of our common stock. The warrants contain customary anti-dilution and net issuance provisions and are not callable by us.
10
Registration Rights
As of June 30, 2017, holders of 2,015,847 shares of our common stock, which includes 35,096 shares of common stock issuable upon the
exercise of warrants, or their transferees will be entitled to the following rights with respect to the registration of such shares for public resale under the Securities Act of 1933, as amended, or the Securities Act, pursuant to an investor rights
agreement by and among us and certain of our stockholders. The registration of shares of common stock as a result of the following rights being exercised would enable holders to trade these shares without restriction under the Securities Act when
the applicable registration statement is declared effective.
Demand Registration Rights
If at any time the holders of at least 30% of the registrable securities request in writing that we effect a registration with respect to at
least 30% of the registrable securities then outstanding or a lesser percentage if shares in an offering with an anticipated aggregate offering price of at least $5.0 million, we may be required to register their shares. We are obligated to effect
at most two registrations in any 12-month period for the holders of registrable securities in response to these demand registration rights. If the holders requesting registration intend to distribute their shares by means of an underwriting, the
managing underwriter of such offering will have the right to limit the numbers of shares to be underwritten for reasons related to the marketing of the shares.
Piggyback Registration Rights
If at any
time we propose to register any shares of our common stock under the Securities Act, subject to certain exceptions, the holders of registrable securities will be entitled to notice of the registration and to include their shares of registrable
securities in the registration. If our proposed registration involves an underwriting, the managing underwriter of such offering will have the right to limit the number of shares to be underwritten for reasons related to the marketing of the shares.
Form S-3 Registration Rights
If at
any time a holder of registrable securities requests in writing that we register their shares for public resale on Form S-3 and the reasonably anticipated price to the public of the offering is $1.0 million or more, we will be required to use our
best efforts to effect such registration; provided, however, that we will not be required to effect such a registration if, within the preceding 12 months, we have already effected two registrations on Form S-3 for the holders of registrable
securities.
Expenses
Ordinarily,
other than underwriting discounts and commissions, we will be required to pay all expenses incurred by us related to any registration effected pursuant to the exercise of these registration rights. These expenses may include all registration and
filing fees, printing expenses, fees and disbursements of our counsel, reasonable fees and disbursements of a counsel for the selling securityholders, blue sky fees and expenses and the expenses of any special audits incident to the registration.
Termination of Registration Rights
The registration rights terminate upon the earlier of July 24, 2020, or, with respect to the registration rights of an individual holder,
when the holder can sell all of such holder’s registrable securities in a three-month period in compliance with Rule 144 of the Securities Act.
Anti-Takeover Effects of Delaware Law and Our Certificate of Incorporation and Bylaws
Some provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws contain provisions
that could make the following transactions more difficult: an acquisition
11
of us by means of a tender offer; an acquisition of us by means of a proxy contest or otherwise; or the removal of our incumbent officers and directors. It is possible that these provisions could
make it more difficult to accomplish or could deter transactions that stockholders may otherwise consider to be in their best interest or in our best interests, including transactions which provide for payment of a premium over the market price for
our shares.
These provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids.
These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of the increased protection of our potential ability to negotiate with the
proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging these proposals because negotiation of these proposals could result in an improvement of their terms.
Undesignated Preferred Stock
The ability
of our board of directors, without action by the stockholders, to issue up to 10,000,000 shares of undesignated preferred stock with voting or other rights or preferences as designated by our board of directors could impede the success of any
attempt to change control of us. These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of our company.
Stockholder Meetings
Our amended and
restated bylaws provide that a special meeting of stockholders may be called only by our chairman of the board, chief executive officer or president, or by a resolution adopted by a majority of our board of directors.
Requirements for Advance Notification of Stockholder Nominations and Proposals
Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals to be brought before a stockholder
meeting and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors.
Elimination of Stockholder Action by Written Consent
Our amended and restated certificate of incorporation and amended and restated bylaws eliminate the right of stockholders to act by written
consent without a meeting.
Staggered Board
Our board of directors is divided into three classes. The directors in each class will serve for a three-year term, one class being elected
each year by our stockholders. This system of electing and removing directors may tend to discourage a third-party from making a tender offer or otherwise attempting to obtain control of us, because it generally makes it more difficult for
stockholders to replace a majority of the directors.
Removal of Directors
Our amended and restated certificate of incorporation provides that no member of our board of directors may be removed from office by our
stockholders except for cause and, in addition to any other vote required by law, upon the approval of not less than two-thirds of the total voting power of all of our outstanding voting stock then entitled to vote in the election of directors.
12
Stockholders Not Entitled to Cumulative Voting
Our amended and restated certificate of incorporation does not permit stockholders to cumulate their votes in the election of directors.
Accordingly, the holders of a majority of the outstanding shares of our common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they choose, other than any directors that holders of our
preferred stock may be entitled to elect.
Delaware Anti-Takeover Statute
We are subject to Section 203 of the Delaware General Corporation Law, which prohibits persons deemed to be “interested
stockholders” from engaging in a “business combination” with a publicly held Delaware corporation for three years following the date these persons become interested stockholders unless the business combination is, or the transaction
in which the person became an interested stockholder was, approved in a prescribed manner or another prescribed exception applies. Generally, an “interested stockholder” is a person who, together with affiliates and associates, owns, or
within three years prior to the determination of interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction
resulting in a financial benefit to the interested stockholder. The existence of this provision may have an anti-takeover effect with respect to transactions not approved in advance by the board of directors.
Amendment of Charter Provisions
The
amendment of any of the above provisions, except for the provision making it possible for our board of directors to issue preferred stock, would require approval by holders of at least two-thirds of the total voting power of all of our outstanding
voting stock.
The provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws
could have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover
attempts. These provisions may also have the effect of preventing changes in the composition of our board and management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise
deem to be in their best interests.
13
DESCRIPTION OF DEBT SECURITIES
The following description, together with the additional information we include in any applicable prospectus supplement, summarizes certain
general terms and provisions of the debt securities that we may offer under this prospectus. When we offer to sell a particular series of debt securities, we will describe the specific terms of the series in a supplement to this prospectus. We will
also indicate in the supplement to what extent the general terms and provisions described in this prospectus apply to a particular series of debt securities. To the extent the information contained in the prospectus supplement differs from this
summary description, you should rely on the information in the prospectus supplement.
We may issue debt securities either separately, or
together with, or upon the conversion or exercise of or in exchange for, other securities described in this prospectus. Debt securities may be our senior, senior subordinated or subordinated obligations and, unless otherwise specified in a
supplement to this prospectus, the debt securities will be our direct, unsecured obligations and may be issued in one or more series.
The
debt securities will be issued under an indenture between us and a trustee named in the prospectus supplement. We have summarized select portions of the indenture below. The summary is not complete. The form of the indenture has been filed as an
exhibit to the registration statement and you should read the indenture for provisions that may be important to you. In the summary below, we have included references to the section numbers of the indenture so that you can easily locate these
provisions. Capitalized terms used in the summary and not defined herein have the meanings specified in the indenture.
General
The terms of each series of debt securities will be established by or pursuant to a resolution of our board of directors and set forth or
determined in the manner provided in a resolution of our board of directors, in an officer’s certificate or by a supplemental indenture. (Section 2.2) The particular terms of each series of debt securities will be described in a prospectus
supplement relating to such series (including any pricing supplement or term sheet).
We can issue an unlimited amount of debt securities
under the indenture that may be in one or more series with the same or various maturities, at par, at a premium, or at a discount. (Section 2.1) We will set forth in a prospectus supplement (including any pricing supplement or term sheet) relating
to any series of debt securities being offered, the aggregate principal amount and the following terms of the debt securities, if applicable:
|
|
•
|
|
the title and ranking of the debt securities (including the terms of any subordination provisions);
|
|
|
•
|
|
the price or prices (expressed as a percentage of the principal amount) at which we will sell the debt
securities;
|
|
|
•
|
|
any limit on the aggregate principal amount of the debt securities;
|
|
|
•
|
|
the date or dates on which the principal on a particular series of debt securities is payable;
|
|
|
•
|
|
the rate or rates (which may be fixed or variable) per annum or the method used to determine the rate or rates
(including any commodity, commodity index, stock exchange index or financial index) at which the debt securities will bear interest, the date or dates from which interest will accrue, the date or dates on which interest will commence and be payable
and any regular record date for the interest payable on any interest payment date;
|
|
|
•
|
|
the place or places where principal of, and interest, if any, on the debt securities will be payable (and the
method of such payment), where the debt securities of such series may be surrendered for registration of transfer or exchange, and where notices and demands to us in respect of the debt securities may be delivered;
|
14
|
|
•
|
|
the period or periods within which, the price or prices at which and the terms and conditions upon which we may
redeem the debt securities;
|
|
|
•
|
|
any obligation we have to redeem or purchase the debt securities pursuant to any sinking fund or analogous
provisions or at the option of a holder of debt securities and the period or periods within which, the price or prices at which and the terms and conditions upon which the debt securities of a particular series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
|
|
|
•
|
|
the dates on which and the price or prices at which we will repurchase debt securities at the option of the
holders of debt securities and other detailed terms and provisions of these repurchase obligations;
|
|
|
•
|
|
the denominations in which the debt securities will be issued, if other than denominations of $1,000 and any
integral multiple thereof;
|
|
|
•
|
|
whether the debt securities will be issued in the form of certificated debt securities or global debt securities;
|
|
|
•
|
|
the portion of principal amount of the debt securities payable upon declaration of acceleration of the maturity
date, if other than the principal amount;
|
|
|
•
|
|
the currency of denomination of the debt securities, which may be U.S. dollars or any foreign currency, and if
such currency of denomination is a composite currency, the agency or organization, if any, responsible for overseeing such composite currency;
|
|
|
•
|
|
the designation of the currency, currencies or currency units in which payment of principal of, and premium and
interest on, the debt securities will be made;
|
|
|
•
|
|
if payments of principal of, or premium or interest on, the debt securities will be made in one or more
currencies or currency units other than that or those in which the debt securities are denominated, the manner in which the exchange rate with respect to these payments will be determined;
|
|
|
•
|
|
the manner in which the amounts of payment of principal of, and premium, if any, and interest on, the debt
securities will be determined, if these amounts may be determined by reference to an index based on a currency or currencies or by reference to a commodity, commodity index, stock exchange index or financial index;
|
|
|
•
|
|
any provisions relating to any security provided for the debt securities;
|
|
|
•
|
|
any addition to, deletion of or change in the Events of Default described in this prospectus or in the indenture
with respect to the debt securities and any change in the acceleration provisions described in this prospectus or in the indenture with respect to the debt securities;
|
|
|
•
|
|
any addition to, deletion of or change in the covenants described in this prospectus or in the indenture with
respect to the debt securities;
|
|
|
•
|
|
any depositaries, interest rate calculation agents, exchange rate calculation agents or other agents with respect
to the debt securities;
|
|
|
•
|
|
the provisions, if any, relating to conversion or exchange of any debt securities of such series, including if
applicable, the conversion or exchange price and period, provisions as to whether conversion or exchange will be mandatory, the events requiring an adjustment of the conversion or exchange price and provisions affecting conversion or exchange;
|
|
|
•
|
|
any other terms of the debt securities, which may supplement, modify or delete any provision of the indenture as
it applies to that series, including any terms that may be required under applicable law or regulations or advisable in connection with the marketing of the securities; and
|
|
|
•
|
|
whether any of our direct or indirect subsidiaries will guarantee the debt securities of that series, including
the terms of subordination, if any, of such guarantees. (Section 2.2)
|
15
We may issue debt securities that provide for an amount less than their stated principal amount
to be due and payable upon declaration of acceleration of their maturity pursuant to the terms of the indenture. We will provide you with information on the federal income tax considerations and other special considerations applicable to any of
these debt securities in the applicable prospectus supplement.
If we denominate the purchase price of any of the debt securities in a
foreign currency or currencies or a foreign currency unit or units, or if the principal of, and premium, if any, and interest on, any series of debt securities is payable in a foreign currency or currencies or a foreign currency unit or units, we
will provide you with information on the restrictions, elections, general tax considerations, specific terms and other information with respect to that issue of debt securities and such foreign currency or currencies or foreign currency unit or
units in the applicable prospectus supplement.
Transfer and Exchange
Each debt security will be represented by either one or more global securities registered in the name of The Depository Trust Company, DTC or
the Depositary, or a nominee of the Depositary (we will refer to any debt security represented by a global debt security as a “book-entry debt security”), or a certificate issued in definitive registered form (we will refer to any debt
security represented by a certificated security as a “certificated debt security”) as set forth in the applicable prospectus supplement. Except as set forth under the heading “Global Debt Securities and Book-Entry System” below,
book-entry debt securities will not be issuable in certificated form.
Certificated Debt Securities. You may transfer or exchange
certificated debt securities at any office we maintain for this purpose in accordance with the terms of the indenture. (Section 2.4) No service charge will be made for any transfer or exchange of certificated debt securities, but we may require
payment of a sum sufficient to cover any tax or other governmental charge payable in connection with a transfer or exchange. (Section 2.7)
You may effect the transfer of certificated debt securities and the right to receive the principal of, premium and interest on certificated
debt securities only by surrendering the certificate representing those certificated debt securities and either reissuance by us or the trustee of the certificate to the new holder or the issuance by us or the trustee of a new certificate to the new
holder.
Global Debt Securities and Book-Entry System. Each global debt security representing book-entry debt securities will be deposited
with, or on behalf of, the Depositary, and registered in the name of the Depositary or a nominee of the Depositary. Please see the section entitled “Global Securities” for more information.
Covenants
We will set forth in the
applicable prospectus supplement any restrictive covenants applicable to any issue of debt securities. (Article IV)
No Protection in the Event of a
Change of Control
Unless we state otherwise in the applicable prospectus supplement, the debt securities will not contain any
provisions that may afford holders of the debt securities protection in the event we have a change in control or in the event of a highly leveraged transaction (whether or not such transaction results in a change in control) that could adversely
affect holders of debt securities.
16
Consolidation, Merger and Sale of Assets
We may not consolidate with or merge with or into, or convey, transfer or lease all or substantially all of our properties and assets to, any
person (a “successor person”) unless:
|
|
•
|
|
we are the surviving corporation or the successor person (if other than Conatus) is a corporation organized and
validly existing under the laws of any U.S. domestic jurisdiction and expressly assumes our obligations on the debt securities and under the indenture;
|
|
|
•
|
|
immediately after giving effect to the transaction, no Default or Event of Default, shall have occurred and be
continuing; and
|
|
|
•
|
|
certain other conditions are met.
|
Notwithstanding the above, any of our subsidiaries may consolidate with, merge into or transfer all or part of its properties to us. (Section
5.1)
Events of Default
“Event
of Default” means with respect to any series of debt securities, any of the following:
|
|
•
|
|
default in the payment of any interest upon any debt security of that series when it becomes due and payable, and
continuance of such default for a period of 30 days (unless the entire amount of the payment is deposited by us with the trustee or with a paying agent prior to the expiration of the 30-day period);
|
|
|
•
|
|
default in the payment of principal of any debt security of that series at its maturity;
|
|
|
•
|
|
default in the performance or breach of any other covenant or warranty by us in the indenture or any debt
security (other than a covenant or warranty that has been included in the indenture solely for the benefit of a series of debt securities other than that series), which default continues uncured for a period of 60 days after we receive written
notice from the trustee or Conatus and the trustee receive written notice from the holders of not less than 25% in principal amount of the outstanding debt securities of that series as provided in the indenture;
|
|
|
•
|
|
certain voluntary or involuntary events of bankruptcy, insolvency or reorganization of Conatus; or
|
|
|
•
|
|
any other Event of Default provided with respect to debt securities of that series that is described in the
applicable prospectus supplement. (Section 6.1)
|
No Event of Default with respect to a particular series of debt
securities (except as to certain events of bankruptcy, insolvency or reorganization) necessarily constitutes an Event of Default with respect to any other series of debt securities. (Section 6.1) The occurrence of certain Events of Default or an
acceleration under the indenture may constitute an event of default under certain indebtedness of ours or our subsidiaries outstanding from time to time.
We will provide the trustee written notice of any Default or Event of Default within 30 days of becoming aware of the occurrence of such
Default or Event of Default, which notice will describe in reasonable detail the status of such Default or Event of Default and what action we are taking or propose to take in respect thereof. (Section 6.1)
If an Event of Default with respect to debt securities of any series at the time outstanding occurs and is continuing, then the trustee or the
holders of not less than 25% in principal amount of the outstanding debt securities of that series may, by a notice in writing to us (and to the trustee if given by the holders), declare to be due and payable immediately the principal of (or, if the
debt securities of that series are discount securities, that portion of the principal amount as may be specified in the terms of that series) and accrued and unpaid interest, if
17
any, on all debt securities of that series. In the case of an Event of Default resulting from certain events of bankruptcy, insolvency or reorganization, the principal (or such specified amount)
of and accrued and unpaid interest, if any, on all outstanding debt securities will become and be immediately due and payable without any declaration or other act on the part of the trustee or any holder of outstanding debt securities. At any time
after a declaration of acceleration with respect to debt securities of any series has been made, but before a judgment or decree for payment of the money due has been obtained by the trustee, the holders of a majority in principal amount of the
outstanding debt securities of that series may rescind and annul the acceleration if all Events of Default, other than the non-payment of accelerated principal and interest, if any, with respect to debt securities of that series, have been cured or
waived as provided in the indenture. (Section 6.2) We refer you to the prospectus supplement relating to any series of debt securities that are discount securities for the particular provisions relating to acceleration of a portion of the principal
amount of such discount securities upon the occurrence of an Event of Default.
The indenture provides that the trustee may refuse to
perform any duty or exercise any of its rights or powers under the indenture, unless the trustee receives indemnity satisfactory to it against any cost, liability or expense that might be incurred by it in performing such duty or exercising such
right or power. (Section 7.1(e)) Subject to certain rights of the trustee, the holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee with respect to the debt securities of that series. (Section 6.12)
No holder of any debt security of any series will have any right to institute any proceeding, judicial or otherwise, with respect to the
indenture or for the appointment of a receiver or trustee, or for any remedy under the indenture, unless:
|
|
•
|
|
that holder has previously given to the trustee written notice of a continuing Event of Default with respect to
debt securities of that series; and
|
|
|
•
|
|
the holders of not less than 25% in principal amount of the outstanding debt securities of that series have made
written request, and offered indemnity or security satisfactory to the trustee, to the trustee to institute the proceeding as trustee, and the trustee has not received from the holders of not less than a majority in principal amount of the
outstanding debt securities of that series a direction inconsistent with that request and has failed to institute the proceeding within 60 days. (Section 6.7)
|
Notwithstanding any other provision in the indenture, the holder of any debt security will have an absolute and unconditional right to receive
payment of the principal of, and premium and any interest on, that debt security on or after the due dates expressed in that debt security and to institute suit for the enforcement of payment. (Section 6.8)
The indenture requires us, within 120 days after the end of our fiscal year, to furnish to the trustee a statement as to compliance with the
indenture. (Section 4.3) If a Default or Event of Default occurs and is continuing with respect to the securities of any series and if it is known to a responsible officer of the trustee, the trustee shall mail to each holder of the securities of
that series notice of a Default or Event of Default within 90 days after it occurs or, if later, after a responsible officer of the trustee has knowledge of such Default or Event of Default. The indenture provides that the trustee may withhold
notice to the holders of debt securities of any series of any Default or Event of Default (except in payment on any debt securities of that series) with respect to debt securities of that series if the trustee determines in good faith that
withholding notice is in the interest of the holders of those debt securities. (Section 7.5)
Modification and Waiver
We and the trustee may modify, amend or supplement the indenture or the debt securities of any series without the consent of any holder of any
debt security:
|
|
•
|
|
to cure any ambiguity, defect or inconsistency;
|
18
|
|
•
|
|
to comply with covenants in the indenture described above under the heading “Consolidation, Merger and Sale
of Assets;”
|
|
|
•
|
|
to provide for uncertificated securities in addition to or in place of certificated securities;
|
|
|
•
|
|
to add guarantees with respect to debt securities of any series or secure debt securities of any series;
|
|
|
•
|
|
to surrender any of our rights or powers under the indenture;
|
|
|
•
|
|
to add covenants or Events of Default for the benefit of the holders of debt securities of any series;
|
|
|
•
|
|
to comply with the applicable procedures of the applicable depositary;
|
|
|
•
|
|
to make any change that does not adversely affect the rights of any holder of debt securities;
|
|
|
•
|
|
to provide for the issuance of and establish the form and terms and conditions of debt securities of any series
as permitted by the indenture;
|
|
|
•
|
|
to effect the appointment of a successor trustee with respect to the debt securities of any series and to add to
or change any of the provisions of the indenture to provide for or facilitate administration by more than one trustee; or
|
|
|
•
|
|
to comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under
the Trust Indenture Act. (Section 9.1)
|
We may also modify and amend the indenture with the consent of the holders of at
least a majority in principal amount of the outstanding debt securities of each series affected by the modifications or amendments. We may not make any modification or amendment without the consent of the holders of each affected debt security then
outstanding if that amendment will:
|
|
•
|
|
reduce the amount of debt securities whose holders must consent to an amendment, supplement or waiver;
|
|
|
•
|
|
reduce the rate of or extend the time for payment of interest (including default interest) on any debt security;
|
|
|
•
|
|
reduce the principal of or premium on or change the fixed maturity of any debt security or reduce the amount of,
or postpone the date fixed for, the payment of any sinking fund or analogous obligation with respect to any series of debt securities;
|
|
|
•
|
|
reduce the principal amount of discount securities payable upon acceleration of maturity;
|
|
|
•
|
|
waive a Default or Event of Default in the payment of the principal of, or premium or interest on, any debt
security (except a rescission of acceleration of the debt securities of any series by the holders of at least a majority in aggregate principal amount of the then outstanding debt securities of that series and a waiver of the payment default that
resulted from such acceleration);
|
|
|
•
|
|
make the principal of, or premium or interest on, any debt security payable in currency other than that stated in
the debt security;
|
|
|
•
|
|
make any change to certain provisions of the indenture relating to, among other things, the right of holders of
debt securities to receive payment of the principal of, and premium and interest on, those debt securities and to institute suit for the enforcement of any such payment and to waivers or amendments; or
|
|
|
•
|
|
waive a redemption payment with respect to any debt security. (Section 9.3)
|
Except for certain specified provisions, the holders of at least a majority in principal amount of the outstanding debt securities of any
series may on behalf of the holders of all debt securities of that series waive our compliance with provisions of the indenture. (Section 9.2) The holders of a majority in principal amount of
19
the outstanding debt securities of any series may on behalf of the holders of all the debt securities of such series waive any past default under the indenture with respect to that series and its
consequences, except a default in the payment of the principal of, or any interest on, any debt security of that series; provided, however, that the holders of a majority in principal amount of the outstanding debt securities of any series may
rescind an acceleration and its consequences, including any related payment default that resulted from the acceleration. (Section 6.13)
Defeasance of
Debt Securities and Certain Covenants in Certain Circumstances
Legal Defeasance
. The indenture provides that, unless otherwise
provided by the terms of the applicable series of debt securities, we may be discharged from any and all obligations in respect of the debt securities of any series (subject to certain exceptions). We will be so discharged upon the deposit with the
trustee, in trust, of money and/or U.S. government obligations or, in the case of debt securities denominated in a single currency other than U.S. dollars, government obligations of the government that issued or caused to be issued such currency,
that, through the payment of interest and principal in accordance with their terms, will provide money or U.S. government obligations in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or
investment bank to pay and discharge each installment of principal of, premium and interest on, and any mandatory sinking fund payments in respect of, the debt securities of that series on the stated maturity of those payments in accordance with the
terms of the indenture and those debt securities.
This discharge may occur only if, among other things, we have delivered to the trustee
an opinion of counsel stating that we have received from, or there has been published by, the U.S. Internal Revenue Service a ruling or, since the date of execution of the indenture, there has been a change in the applicable U.S. federal income tax
law, in either case to the effect that, and based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the deposit,
defeasance and discharge and will be subject to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the case if the deposit, defeasance and discharge had not occurred. (Section 8.3)
Defeasance of Certain Covenants
. The indenture provides that, unless otherwise provided by the terms of the applicable series of debt
securities, upon compliance with certain conditions:
|
|
•
|
|
we may omit to comply with the covenant described under the heading “Consolidation, Merger and Sale of
Assets” and certain other covenants set forth in the indenture, as well as any additional covenants that may be set forth in the applicable prospectus supplement; and
|
|
|
•
|
|
any omission to comply with those covenants will not constitute a Default or an Event of Default with respect to
the debt securities of that series (“covenant defeasance”).
|
The conditions include:
|
|
•
|
|
depositing with the trustee money and/or U.S. government obligations or, in the case of debt securities
denominated in a single currency other than U.S. dollars, government obligations of the government that issued or caused to be issued such currency, that, through the payment of interest and principal in accordance with their terms, will provide
money in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or investment bank to pay and discharge each installment of principal of, premium and interest on, and any mandatory sinking fund payments
in respect of, the debt securities of that series on the stated maturity of those payments in accordance with the terms of the indenture and those debt securities; and
|
|
|
•
|
|
delivering to the trustee an opinion of counsel to the effect that we have received from, or there has been
published by, the U.S. Internal Revenue Service a ruling or, since the date of execution of the indenture, there has been a change in the applicable U.S. federal income tax law, in either case to the
|
20
|
|
effect that, and based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize income, gain or loss for U.S. federal income tax purposes as a
result of the deposit and related covenant defeasance and will be subject to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the case if the deposit and related covenant defeasance had not
occurred. (Section 8.4)
|
No Personal Liability of Directors, Officers, Employees or Stockholders
None of our past, present or future directors, officers, employees or stockholders, as such, will have any liability for any of our obligations
under the debt securities or the indenture or for any claim based on, or in respect or by reason of, such obligations or their creation. By accepting a debt security, each holder waives and releases all such liability. This waiver and release is
part of the consideration for the issue of the debt securities. However, this waiver and release may not be effective to waive liabilities under U.S. federal securities laws, and it is the view of the SEC that such a waiver is against public policy.
Governing Law
The indenture and the
debt securities, including any claim or controversy arising out of or relating to the indenture or the debt securities, will be governed by the laws of the State of New York.
The indenture will provide that we, the trustee and the holders of the debt securities (by their acceptance of the debt securities)
irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to the indenture, the debt securities or the transactions contemplated thereby.
The indenture will provide that any legal suit, action or proceeding arising out of or based upon the indenture or the transactions
contemplated thereby may be instituted in the federal courts of the United States of America located in the City of New York or the courts of the State of New York in each case located in the City of New York, and we, the trustee and the holder of
the debt securities (by their acceptance of the debt securities) irrevocably submit to the non-exclusive jurisdiction of such courts in any such suit, action or proceeding. The indenture will further provide that service of any process, summons,
notice or document by mail (to the extent allowed under any applicable statute or rule of court) to such party’s address set forth in the indenture will be effective service of process for any suit, action or other proceeding brought in any
such court. The indenture will further provide that we, the trustee and the holders of the debt securities (by their acceptance of the debt securities) irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or
other proceeding in the courts specified above and irrevocably and unconditionally waive and agree not to plead or claim any such suit, action or other proceeding has been brought in an inconvenient forum. (Section 10.10)
21
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of shares of our common stock or preferred stock or of debt securities. We may issue warrants
independently or together with other securities, and the warrants may be attached to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement to be entered into between us and the investors
or a warrant agent. The following summary of material provisions of the warrants and warrant agreements is subject to, and qualified in its entirety by reference to, all the provisions of the warrant agreement and warrant certificate applicable to a
particular series of warrants. The terms of any warrants offered under a prospectus supplement may differ from the terms described below. We urge you to read the applicable prospectus supplement and any related free writing prospectus, as well as
the complete warrant agreements and warrant certificates that contain the terms of the warrants.
The particular terms of any issue of
warrants will be described in the prospectus supplement relating to the issue. Those terms may include:
|
|
•
|
|
the number of shares of common stock or preferred stock purchasable upon the exercise of warrants to purchase
such shares and the price at which such number of shares may be purchased upon such exercise;
|
|
|
•
|
|
the designation, stated value and terms (including, without limitation, liquidation, dividend, conversion and
voting rights) of the series of preferred stock purchasable upon exercise of warrants to purchase preferred stock;
|
|
|
•
|
|
the principal amount of debt securities that may be purchased upon exercise of a debt warrant and the exercise
price for the warrants, which may be payable in cash, securities or other property;
|
|
|
•
|
|
the date, if any, on and after which the warrants and the related debt securities, preferred stock or common
stock will be separately transferable;
|
|
|
•
|
|
the terms of any rights to redeem or call the warrants;
|
|
|
•
|
|
the date on which the right to exercise the warrants will commence and the date on which the right will expire;
|
|
|
•
|
|
U.S. federal income tax consequences applicable to the warrants; and
|
|
|
•
|
|
any additional terms of the warrants, including terms, procedures, and limitations relating to the exchange,
exercise and settlement of the warrants.
|
Holders of equity warrants will not be entitled to:
|
|
•
|
|
vote, consent or receive dividends;
|
|
|
•
|
|
receive notice as stockholders with respect to any meeting of stockholders for the election of our directors or
any other matter; or
|
|
|
•
|
|
exercise any rights as stockholders of Conatus.
|
Each warrant will entitle its holder to purchase the principal amount of debt securities or the number of shares of preferred stock or common
stock at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. Unless we otherwise specify in the applicable prospectus supplement, holders of the warrants may exercise the warrants at any time up to
the specified time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.
A holder of warrant certificates may exchange them for new warrant certificates of different denominations, present them for registration of
transfer and exercise them at the corporate trust office of the warrant agent or any
22
other office indicated in the applicable prospectus supplement. Until any warrants to purchase debt securities are exercised, the holder of the warrants will not have any rights of holders of the
debt securities that can be purchased upon exercise, including any rights to receive payments of principal, premium or interest on the underlying debt securities or to enforce covenants in the applicable indenture. Until any warrants to purchase
common stock or preferred stock are exercised, the holders of the warrants will not have any rights of holders of the underlying common stock or preferred stock, including any rights to receive dividends or payments upon any liquidation, dissolution
or winding up on the common stock or preferred stock, if any.
23
DESCRIPTION OF UNITS
We may issue units consisting of any combination of the other types of securities offered under this prospectus in one or more series. We may
evidence each series of units by unit certificates that we will issue under a separate agreement. We may enter into unit agreements with a unit agent. Each unit agent will be a bank or trust company that we select. We will indicate the name and
address of the unit agent in the applicable prospectus supplement relating to a particular series of units.
The following description,
together with the additional information included in any applicable prospectus supplement, summarizes the general features of the units that we may offer under this prospectus. You should read any prospectus supplement and any free writing
prospectus that we may authorize to be provided to you related to the series of units being offered, as well as the complete unit agreements that contain the terms of the units. Specific unit agreements will contain additional important terms and
provisions and we will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from another report that we file with the SEC, the form of each unit agreement relating to units offered
under this prospectus.
If we offer any units, certain terms of that series of units will be described in the applicable prospectus
supplement, including, without limitation, the following, as applicable:
|
|
•
|
|
the title of the series of units;
|
|
|
•
|
|
identification and description of the separate constituent securities comprising the units;
|
|
|
•
|
|
the price or prices at which the units will be issued;
|
|
|
•
|
|
the date, if any, on and after which the constituent securities comprising the units will be separately
transferable;
|
|
|
•
|
|
a discussion of certain U.S. federal income tax considerations applicable to the units; and
|
|
|
•
|
|
any other terms of the units and their constituent securities.
|
24
GLOBAL SECURITIES
Book-Entry, Delivery and Form
Unless we
indicate differently in a prospectus supplement, the securities initially will be issued in book-entry form and represented by one or more global notes or global securities, or, collectively, global securities. The global securities will be
deposited with, or on behalf of DTC and registered in the name of Cede & Co., the nominee of DTC. Unless and until it is exchanged for individual certificates evidencing securities under the limited circumstances described below, a global
security may not be transferred except as a whole by the depositary to its nominee or by the nominee to the depositary, or by the depositary or its nominee to a successor depositary or to a nominee of the successor depositary.
DTC has advised us that it is:
|
|
•
|
|
a limited-purpose trust company organized under the New York Banking Law;
|
|
|
•
|
|
a “banking organization” within the meaning of the New York Banking Law;
|
|
|
•
|
|
a member of the Federal Reserve System;
|
|
|
•
|
|
a “clearing corporation” within the meaning of the New York Uniform Commercial Code; and
|
|
|
•
|
|
a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act.
|
DTC holds securities that its participants deposit with DTC. DTC also facilitates the settlement among its participants
of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in participants’ accounts, thereby eliminating the need for physical movement of securities certificates.
“Direct participants” in DTC include securities brokers and dealers, including underwriters, banks, trust companies, clearing corporations and other organizations. DTC is a wholly-owned subsidiary of The Depository Trust &
Clearing Corporation, or DTCC. DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated
subsidiaries. Access to the DTC system is also available to others, which we sometimes refer to as indirect participants, that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly. The rules
applicable to DTC and its participants are on file with the SEC.
Purchases of securities under the DTC system must be made by or through
direct participants, which will receive a credit for the securities on DTC’s records. The ownership interest of the actual purchaser of a security, which we sometimes refer to as a beneficial owner, is in turn recorded on the direct and
indirect participants’ records. Beneficial owners of securities will not receive written confirmation from DTC of their purchases. However, beneficial owners are expected to receive written confirmations providing details of their transactions,
as well as periodic statements of their holdings, from the direct or indirect participants through which they purchased securities. Transfers of ownership interests in global securities are to be accomplished by entries made on the books of
participants acting on behalf of beneficial owners. Beneficial owners will not receive certificates representing their ownership interests in the global securities, except under the limited circumstances described below.
To facilitate subsequent transfers, all global securities deposited by direct participants with DTC will be registered in the name of
DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of securities with DTC and their registration in the name of Cede & Co. or such other nominee
will not change the beneficial ownership of the securities. DTC has no knowledge of the actual beneficial owners of the securities. DTC’s records reflect only the identity of the direct participants to whose accounts the securities are
credited, which may or may not be the beneficial owners. The participants are responsible for keeping account of their holdings on behalf of their customers.
25
So long as the securities are in book-entry form, you will receive payments and may transfer
securities only through the facilities of the depositary and its direct and indirect participants. We will maintain an office or agency in the location specified in the prospectus supplement for the applicable securities, where notices and demands
in respect of the securities and the indenture may be delivered to us and where certificated securities may be surrendered for payment, registration of transfer or exchange.
Conveyance of notices and other communications by DTC to direct participants, by direct participants to indirect participants and by direct
participants and indirect participants to beneficial owners will be governed by arrangements among them, subject to any legal requirements in effect from time to time.
Redemption notices will be sent to DTC. If less than all of the securities of a particular series are being redeemed, DTC’s practice is
to determine by lot the amount of the interest of each direct participant in the securities of such series to be redeemed.
Neither DTC
nor Cede & Co. (or such other DTC nominee) will consent or vote with respect to the securities. Under its usual procedures, DTC will mail an omnibus proxy to us as soon as possible after the record date. The omnibus proxy assigns the
consenting or voting rights of Cede & Co. to those direct participants to whose accounts the securities of such series are credited on the record date, identified in a listing attached to the omnibus proxy.
So long as securities are in book-entry form, we will make payments on those securities to the depositary or its nominee, as the registered
owner of such securities, by wire transfer of immediately available funds. If securities are issued in definitive certificated form under the limited circumstances described below, we will have the option of making payments by check mailed to the
addresses of the persons entitled to payment or by wire transfer to bank accounts in the United States designated in writing to the applicable trustee or other designated party at least 15 days before the applicable payment date by the persons
entitled to payment, unless a shorter period is satisfactory to the applicable trustee or other designated party.
Redemption proceeds,
distributions and dividend payments on the securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon
DTC’s receipt of funds and corresponding detail information from us on the payment date in accordance with their respective holdings shown on DTC records. Payments by participants to beneficial owners will be governed by standing instructions
and customary practices, as is the case with securities held for the account of customers in bearer form or registered in “street name.” Those payments will be the responsibility of participants and not of DTC or us, subject to any
statutory or regulatory requirements in effect from time to time. Payment of redemption proceeds, distributions and dividend payments to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC, is our
responsibility; disbursement of payments to direct participants is the responsibility of DTC; and disbursement of payments to the beneficial owners is the responsibility of direct and indirect participants.
Except under the limited circumstances described below, purchasers of securities will not be entitled to have securities registered in their
names and will not receive physical delivery of securities. Accordingly, each beneficial owner must rely on the procedures of DTC and its participants to exercise any rights under the securities and the indenture.
The laws of some jurisdictions may require that some purchasers of securities take physical delivery of securities in definitive form. Those
laws may impair the ability to transfer or pledge beneficial interests in securities.
DTC may discontinue providing its services as
securities depositary with respect to the securities at any time by giving reasonable notice to us. Under such circumstances, in the event that a successor depositary is not obtained, securities certificates are required to be printed and delivered.
26
As noted above, beneficial owners of a particular series of securities generally will not receive
certificates representing their ownership interests in those securities. However, if:
|
|
•
|
|
DTC notifies us that it is unwilling or unable to continue as a depositary for the global security or securities
representing such series of securities or if DTC ceases to be a clearing agency registered under the Exchange Act at a time when it is required to be registered and a successor depositary is not appointed within 90 days of the notification to us or
of our becoming aware of DTC’s ceasing to be so registered, as the case may be;
|
|
|
•
|
|
we determine, in our sole discretion, not to have such securities represented by one or more global securities;
or
|
|
|
•
|
|
an Event of Default has occurred and is continuing with respect to such series of securities,
|
we will prepare and deliver certificates for such securities in exchange for beneficial interests in the global securities. Any
beneficial interest in a global security that is exchangeable under the circumstances described in the preceding sentence will be exchangeable for securities in definitive certificated form registered in the names that the depositary directs. It is
expected that these directions will be based upon directions received by the depositary from its participants with respect to ownership of beneficial interests in the global securities.
We have obtained the information in this section and elsewhere in this prospectus concerning DTC and DTC’s book-entry system from sources
that are believed to be reliable, but we take no responsibility for the accuracy of this information.
27
PLAN OF DISTRIBUTION
We may sell the securities from time to time pursuant to underwritten public offerings, negotiated transactions, block trades or a combination
of these methods or through underwriters or dealers, through agents and/or directly to one or more purchasers. The securities may be distributed from time to time in one or more transactions:
|
|
•
|
|
at a fixed price or prices, which may be changed;
|
|
|
•
|
|
at market prices prevailing at the time of sale;
|
|
|
•
|
|
at prices related to such prevailing market prices; or
|
Each time that we sell securities covered by this prospectus, we will provide a prospectus supplement or supplements that will describe the
method of distribution and set forth the terms and conditions of the offering of such securities, including the offering price of the securities and the proceeds to us, if applicable.
Offers to purchase the securities being offered by this prospectus may be solicited directly. Agents may also be designated to solicit offers
to purchase the securities from time to time. Any agent involved in the offer or sale of our securities will be identified in a prospectus supplement.
If a dealer is utilized in the sale of the securities being offered by this prospectus, the securities will be sold to the dealer, as
principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale.
If an underwriter is utilized in the sale of the securities being offered by this prospectus, an underwriting agreement will be executed with
the underwriter at the time of sale and the name of any underwriter will be provided in the prospectus supplement that the underwriter will use to make resales of the securities to the public. In connection with the sale of the securities, we or the
purchasers of securities for whom the underwriter may act as agent, may compensate the underwriter in the form of underwriting discounts or commissions. The underwriter may sell the securities to or through dealers, and those dealers may receive
compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for which they may act as agent. Unless otherwise indicated in a prospectus supplement, an agent will be acting on a best
efforts basis and a dealer will purchase securities as a principal, and may then resell the securities at varying prices to be determined by the dealer.
Any compensation paid to underwriters, dealers or agents in connection with the offering of the securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers will be provided in the applicable prospectus supplement. Underwriters, dealers and agents participating in the distribution of the securities may be deemed to be underwriters within the
meaning of the Securities Act, and any discounts and commissions received by them and any profit realized by them on resale of the securities may be deemed to be underwriting discounts and commissions. We may enter into agreements to indemnify
underwriters, dealers and agents against civil liabilities, including liabilities under the Securities Act, or to contribute to payments they may be required to make in respect thereof and to reimburse those persons for certain expenses.
Any common stock or preferred stock will be listed on The Nasdaq Global Market, but any other securities may or may not be listed on a
national securities exchange. To facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. This may include
over-allotments or short sales of the securities, which involve the sale by persons participating in the offering of more securities than were sold to them. In these circumstances, these persons would cover such over-allotments or short positions by
making purchases in the open market or by exercising their over-allotment option, if any. In addition, these persons may stabilize or maintain the price of the securities
28
by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating in the offering may be reclaimed if securities
sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market.
These transactions may be discontinued at any time.
We may engage in at the market offerings into an existing trading market in
accordance with Rule 415(a)(4) under the Securities Act. In addition, we may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the
applicable prospectus supplement so indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third
party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open
borrowings of stock. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be named in the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise
loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus and an applicable prospectus supplement. Such financial institution or other third party may transfer its
economic short position to investors in our securities or in connection with a concurrent offering of other securities.
The specific
terms of any lock-up provisions in respect of any given offering will be described in the applicable prospectus supplement.
In compliance
with the guidelines of the Financial Industry Regulatory Authority, Inc., or FINRA, the maximum consideration or discount to be received by any FINRA member or independent broker dealer may not exceed 8% of the aggregate proceeds of the offering.
The underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business
for which they receive compensation.
29
LEGAL MATTERS
Latham & Watkins LLP, San Diego, California, will pass upon certain legal matters relating to the issuance and sale of the securities
offered hereby on behalf of Conatus Pharmaceuticals Inc. Additional legal matters may be passed upon for us or any underwriters, dealers or agents, by counsel that we will name in the applicable prospectus supplement.
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our
Annual Report on Form 10-K for the year ended December 31, 2016, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by
reference in reliance on Ernst & Young LLP’s report, given on their authority as experts in accounting and auditing.
30
$35,000,000
Common Stock
PROSPECTUS SUPPLEMENT
August 2, 2018
Conatus Pharmaceuticals (NASDAQ:CNAT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Conatus Pharmaceuticals (NASDAQ:CNAT)
Historical Stock Chart
From Apr 2023 to Apr 2024
