Item 1.01
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Entry Into a Material Definitive Agreement.
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On January 31, 2020, CytoDyn Inc. (the Company), issued in private placements to accredited investors an aggregate of 7,570
shares of its newly authorized Series D Convertible Preferred Stock, par value $0.001 per share, with an initial stated value of $1,000 per share (the Series D Preferred Stock), together with warrants to purchase an aggregate of up to
3,785,000 shares of its common stock, par value $0.001 per share (Common Stock), with an initial exercise price of $1.00 per share (the Series D Warrants) for aggregate gross proceeds to the Company of approximately
$7,570,000 million (the Series D Offering).
The shares of Series D Preferred Stock are convertible into shares of Common
Stock at an initial conversion price of $0.80 per share (the Conversion Price) and will carry dividends at a rate of 10% per annum (subject to adjustment as provided in the Certificate of Designation of the Rights, Preferences,
Privileges and Restrictions of the Series D Convertible Preferred Stock (the Series D Certificate of Designation)) and have the preferences, rights and limitations set forth in the Series D Certificate of Designation. The Series D
Warrants have a five-year term and are immediately exercisable. Pursuant to the subscription agreements entered into with each of the investors (the Subscription Agreements), the Company has agreed to use commercially reasonable efforts
to prepare and file with the United States Securities and Exchange Commission within 120 days following the closing of the Series D Offering, but not later than April 30, 2020, a registration statement under the Securities Act of 1933, as
amended, covering the resale of all of the Common Stock issuable to the investors upon the conversion of the Series D Preferred Stock and the exercise of the Series D Warrants.
The representations, warranties and covenants contained in the Subscription Agreements were made solely for the benefit of the parties to the
Subscription Agreements. In addition, such representations, warranties and covenants (i) are intended as a way of allocating the risk between the parties to the Subscription Agreements and not as statements of fact, and (ii) may apply
standards of materiality in a way that is different from what may be viewed as material by stockholders of, or other investors in, the Company. Accordingly, the forms of the Subscription Agreements are included with this filing only to provide
investors with information regarding the terms of transaction, and not to provide investors with any other factual information regarding the Company. Stockholders should not rely on the representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or condition of the Company or any of its subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of
the Subscription Agreements, which subsequent information may or may not be fully reflected in public disclosures.
The shares of Series D
Preferred Stock and the Series D Warrants were offered and sold in reliance on an exemption from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506 of Regulation D. Each investor has represented
that it is an accredited investor, as defined in Regulation D, and has acquired the securities for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof. The securities were not issued through any
general solicitation or advertisement.