NRXP NRX Pharmaceuticals Inc

 

Filed Pursuant to Rule 424(b)(5)
Registration File No. 333-265492

 

The information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus are part of an effective registration statement filed with the Securities and Exchange Commission. This preliminary prospectus supplement and the accompanying prospectus are not an offer to sell these securities, and we are not soliciting an offer to buy these securities, in any jurisdiction where the offer or sale is not permitted.

 

Subject to completion, dated February 26, 2024

 

Preliminary Prospectus Supplement
(To Prospectus dated June 21, 2022)

 

 

 

Shares of Common Stock

 

Pre-Funded Warrants to Purchase                            Shares of Common Stock

 

 

We are offering              shares of our common stock, par value, $0.001 per share, and pre-funded warrants to purchase (the “Pre-Funded Warrants”) to purchase up to              shares of common stock (and the shares of common stock issuable from time to time upon exercise of the Pre-Funded Warrants) in this offering. The public offering price of each share of common stock is $            and the public offering price of each Pre-Funded Warrant to purchase one share of common stock is $             .

 

We are offering the Pre-Funded Warrants to purchase shares of common stock (and the shares of common stock issuable from time to time upon exercise of the Pre-Funded Warrants), in lieu of shares of common stock, to investors whose purchase of shares of common stock in this offering would otherwise result in any such investor, together with its affiliates, beneficially owning more than 4.99% (or, at the election of such investor, 9.99%) of our outstanding shares of common stock immediately following the consummation of this offering, in lieu of shares of common stock that would otherwise result in such investor’s beneficial ownership exceeding 4.99% (or, at the election of such investor, 9.99%) of our outstanding shares of common stock. Each Pre-Funded Warrant will be exercisable for one share of common stock at an exercise price of $0.001 per share of common stock, will be exercisable immediately and will expire when exercised in full. The offering price per Pre-Funded Warrant is equal to the offering price per share of common stock, less $0.001. We are also offering the shares of common stock that are issuable from time to time upon exercise of the Pre-Funded Warrants.

 

There is no established public trading market for the Pre-Funded Warrants, and we do not expect a market to develop. In addition, we do not intend to list the Pre-Funded Warrants, nor do we expect the Pre-Funded Warrants to be quoted, on the Nasdaq Capital Market (“Nasdaq”) or any other national securities exchange or any other nationally recognized trading system. Without an active trading market, the liquidity of the Pre-Funded Warrants will be limited.

 

Our common stock and our public warrants (the “Public Warrants”) are listed on Nasdaq under the symbols “NRXP” and “NRXPW”, respectively. On February 23, 2024, the closing price of our common stock was $0.44 and the closing price of our Public Warrants was $0.1101. 

 

As of the date of this prospectus supplement, the aggregate market value of our common stock held by our non-affiliates, as calculated pursuant to the rules of the Securities and Exchange Commission (the “SEC”), was $34,842,686, based upon 68,052,122 shares of our outstanding common stock held by non-affiliates at the per share price of $0.512, the closing sale price of our common stock on Nasdaq on February 9, 2024. Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell securities in a public offering with a value exceeding more than one-third of our “public float” (i.e., the market value of our common stock held by our non-affiliates) in any 12-month period so long as our public float remains below $75.0 million. We have offered $8,285,501 of securities pursuant to General Instruction I.B.6 of Form S-3 during the 12 calendar months prior to and including the date of this prospectus supplement.

 

Investing in our securities involves a high degree of risk. You should read this prospectus supplement and the accompanying prospectus carefully before you make your investment decision. See “Risk Factors” beginning on page S-5 of this prospectus supplement, page 10 of the accompanying prospectus, and the other documents we file or have filed with the SEC that are incorporated by reference in this prospectus supplement and in the accompanying prospectus, for a discussion of the factors you should consider before investing in our securities.

 

Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

		Per Share			Per Pre- Funded Warrant		Total
Public offering price		$			$		$
Underwriting discounts and commissions(1)		$			$		$
Proceeds, before expenses, to us		$			$		$

 

⁽¹⁾ Does not include a non-accountable expense allowance of 1.0% of the gross proceeds of this offering or other expenses payable by the Company to the underwriter in connection with this offering. In addition, we have agreed to issue the representative of the underwriters, or its designees, warrants to purchase a number of shares of common stock equal to 5.0% of the aggregate number of shares of common stock sold in this offering with an assumed exercise price of $                 per share, or 110% of the public offering price per share (the “underwriter's warrants”). See “Underwriting” on page S-10 for additional disclosure regarding underwriting dicsounts, commissions and expenses.

 

We have granted the representative of the underwriters a 45-day option to purchase up to                 additional shares of common stock and/or Pre-Funded Warrants from us at the same terms and conditions set forth above.

 

We are a “smaller reporting company” under the federal securities laws and, as such, we have elected to comply with certain reduced public company reporting requirements and scaled disclosures for this prospectus and future filings. See “Prospectus Supplement Summary—Implication of Being a Smaller Reporting Company.”

 

Delivery of the shares of common stock and the Pre-Funded Warrants offered pursuant to this prospectus supplement and accompanying prospectus is expected to be made on or about                            , 2024, subject to satisfaction of customary closing conditions.

 

Sole Book-Running Manager

 

 

 

The date of this prospectus supplement is February            , 2024

 

 

TABLE OF CONTENTS

 

Prospectus Supplement

 

About This Prospectus Supplement	S-ii
Cautionary Note Regarding Forward-Looking STATEMENTS	S-iv
Prospectus Supplement Summary	S-1
Risk Factors	S-5
Use of Proceeds	S-8
Dividend Policy	S-8
Dilution	S-9
Underwriting	S-10
Description of Securities being offered	S-14
Material U.S. Federal Income Tax Considerations	S-16
Legal Matters	S-20
Experts	S-20
Where You Can Find More Information	S-20
Incorporation of Certain Documents by Reference	S-20

 

PROSPECTUS

 

	ABOUT THIS PROSPECTUS					1
	WHERE YOU CAN FIND MORE INFORMATION					2
	INCORPORATION BY REFERENCE					3
	CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS					4
	THE COMPANY					5
	RISK FACTORS					10
	USE OF PROCEEDS					11
	DESCRIPTION OF CAPITAL STOCK					12
	DESCRIPTION OF THE DEBT SECURITIES					16
	DESCRIPTION OF DEPOSITARY SHARES					26
	DESCRIPTION OF THE WARRANTS					29
	DESCRIPTION OF THE RIGHTS					31
	DESCRIPTION OF THE PURCHASE CONTRACTS					32
	DESCRIPTION OF THE UNITS					33
	PLAN OF DISTRIBUTION					34
	LEGAL MATTERS					37
	EXPERTS					37

 

 

About This Prospectus Supplement

 

This prospectus supplement relates to the offering of our securities. Before buying the securities offered hereby, we urge you to read carefully this prospectus supplement, the accompanying prospectus, and any free writing prospectus that we have authorized for use in connection with this offering, together with the information incorporated by reference herein, as described under the heading “Incorporation of Certain Documents by Reference.” These documents contain important information that you should consider when making your investment decision. This prospectus supplement contains information about the securities offered hereby.

 

This document is in two parts. The first part is this prospectus supplement, which describes the specific terms of the securities we are offering. The second part is the accompanying prospectus, including the information incorporated by reference therein, which provides more general information, some of which may not apply to this offering. This prospectus supplement and the information incorporated by reference in this prospectus supplement also may add to, update and change information contained in, or incorporated by reference into, the accompanying prospectus. Generally, when we refer to this prospectus, we are referring to both parts of this document combined. To the extent there is a conflict between (i) the information contained in this prospectus supplement and (ii) the information contained in the accompanying prospectus or in any information incorporated by reference that was filed with the SEC before the date of this prospectus supplement, 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, information incorporated by reference in this prospectus supplement or the accompanying prospectus, the statement in the document having the later date modifies or supersedes the earlier statement.

 

We further note that the representations, warranties and covenants made by us in any agreement that is filed as an exhibit to the registration statement to which the accompanying prospectus forms a part or to any document that is incorporated by reference in this prospectus supplement or the accompanying prospectus were made solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing the current state of our affairs.

 

The accompanying prospectus is part of a registration statement that we filed with the SEC using a shelf registration process on Form S-3 (File No. 333-265492), which such registration statement was originally filed on June 9, 2022, and declared effective by the SEC on June 21, 2022. Under the shelf registration process, from time to time, we may offer and sell any of the securities described in the accompanying prospectus separately or together with other securities described therein.

 

You should rely only on the information contained in, or incorporated by reference into, this prospectus supplement, the accompanying prospectus, the information incorporated by reference herein, and any related free writing prospectus that we authorized to be distributed to you. Neither we nor the underwriters have authorized anyone to provide you with different or additional information. If anyone provides you with different or additional information, you should not rely on it. Neither we nor the underwriters is making an offer to sell the securities in any jurisdiction where the offer or sale is not permitted, and you should not consider this prospectus supplement or the accompanying prospectus to be an offer or solicitation relating to the securities in any jurisdiction in which such an offer or solicitation relating to the securities is not authorized. You should assume that the information contained in this prospectus supplement, the accompanying prospectus, any related free writing prospectus that we have authorized to be delivered to you and the information incorporated by reference herein and therein is accurate only as of their respective dates, regardless of the time of delivery of this prospectus supplement, the accompanying prospectus, and any related free writing prospectus or of any sale of securities. Our business, financial condition, results of operations and prospects may have changed since those dates. Furthermore, you should not consider this prospectus supplement or the accompanying prospectus to be an offer or solicitation relating to the securities if the person making the offer or solicitation is not qualified to do so, or if it is unlawful for you to receive such an offer or solicitation.

 

 

Unless otherwise indicated, information contained in this prospectus supplement and the accompanying prospectus or the information incorporated by reference herein or therein concerning our industry and the markets in which we operate, including our general expectations and market position, market opportunity and market share, is based on information from our own management estimates and research, as well as from industry and general publications and research, surveys and studies conducted by third parties. Management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on such information and knowledge, which we believe to be reasonable. In addition, assumptions and estimates of our and our industry's future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section entitled “Risk Factors” in this prospectus supplement and the accompanying prospectus, and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on May 1, 2023, and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023, and September 30, 2023, filed with the SEC on May 15, 2023, August 14, 2023, and November 14, 2023, respectively, which are incorporated by reference into this prospectus supplement. These and other important factors could cause our future performance to differ materially from our assumptions and estimates. See “Cautionary Note Regarding Forward-Looking Statements.”

 

This prospectus supplement, the accompanying prospectus, and the information incorporated herein and therein by reference includes trademarks, service marks and trade names owned by us or other companies. All trademarks, service marks and trade names included or incorporated by reference into this prospectus supplement or the accompanying prospectus are the property of their respective owners.

 

In this prospectus, the terms “NRx,” “the Company,” “we,” “us” and “our” refer to NRx Pharmaceuticals, Inc.

 

We are offering to sell, and are seeking offers to buy, the securities only in jurisdictions where such offers and sales are permitted. The distribution of this prospectus supplement and the accompanying prospectus and the offering of the securities in certain jurisdictions may be restricted by law. Persons outside the United States who come into possession of this prospectus supplement and the accompanying prospectus must inform themselves about and observe any restrictions relating to the offering of the securities and the distribution of this prospectus supplement and the accompanying prospectus outside the United States. This prospectus supplement and the accompanying prospectus do not constitute, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy, any securities offered by this prospectus supplement and the accompanying prospectus to or by any person in any jurisdiction in which it is unlawful for such person to make such an offer or solicitation.

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This prospectus supplement and the information incorporated by reference herein include “forward-looking statements” within the meaning of the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995, which may include, but are not limited to, statements regarding our financial outlook, product development, business prospects, and market and industry trends and conditions, as well as our strategies, plans, objectives, and goals. These forward-looking statements are based on current beliefs, expectations, estimates, forecasts, and projections of, as well as assumptions made by, and information currently available to, our management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “would,” “seek,” “plan,” “intend,” “shall,” and variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements.

 

These forward- looking statements are, by their nature, subject to significant risks and uncertainties, many of which involve factors or circumstances that are beyond our control. These risks and uncertainties include, but are not limited to, our relatively limited operating history; our ability to expand, retain and motivate our employees and manage our growth; risks associated with general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the ongoing effects of the COVID-19 endemic; the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; our ability to accurately predict future market conditions; our ability to regain and maintain compliance with Nasdaq’s listing standards; maintain compliance with the terms of our indebtedness; manufacturing difficulties or delays; changes in laws, rules or regulations relating to any aspect of our business operations, or general economic, market and business conditions; financial instability of international economies and sovereign risk; dependence on the effectiveness of our patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions. Furthermore, there can be no guarantees with respect to pipeline products that the products will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements. We assume no obligation and does not intend to update or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law. As a result of these and other risks, uncertainties and assumptions, forward-looking events and circumstances discussed herein might not occur in the way that tour management expects, if at all. Accordingly, you should not place reliance on any forward-looking statement, and all forward-looking statements are herein qualified by reference to the cautionary statements set forth above.

 

You also should carefully review the risk factors and cautionary statements described in the other documents we file or furnish from time to time with the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The forward-looking statements included in this prospectus supplement, the accompanying prospectus and any other offering material, or in the documents incorporated by reference into this prospectus supplement, the accompanying prospectus and any other offering material, are made only as of the date of the prospectus supplement, the accompanying prospectus, any other offering material or the incorporated document.

 

We do not assume any obligation to update any forward-looking statements. We disclaim any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

 

 

RISK FACTORS

 

An investment in our securities involves a high degree of risk. Prior to making a decision about investing in our securities, you should consider carefully the specific risk factors discussed in the sections entitled “Risk Factors” contained in our most recent Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 31, 2023, as amended on May 1, 2023, and May 26, 2023, which are incorporated into this prospectus supplement and the accompanying prospectus by reference in their entirety, as updated or superseded by the risks and uncertainties described under similar headings in our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K, and the other documents that are filed after the date hereof and incorporated by reference into this prospectus supplement and the accompanying prospectus, together with other information in this prospectus supplement and the accompanying prospectus and any free writing prospectus that we may authorize for use in connection with this offering. These risks and uncertainties are not the only risks and uncertainties we face. Additional risks and uncertainties not presently known to us, or that we currently view as immaterial, may also impair our business. Past financial performance may not be a reliable indicator of future performance, and historical trends should not be unduly relied upon to anticipate results or trends in future periods. If any of the risks or uncertainties described in our SEC filings or any additional risks and uncertainties actually occur, our business, financial condition, results of operations and cash flow could be materially and adversely affected. In that case, the trading price of our common stock could decline and you might lose all or part of your investment. Please also read carefully the section above titled “Cautionary Note Regarding Forward-Looking Statements.”

 

Risks Related to our Common Stock and this Offering

 

If we fail to meet the applicable continued listing requirements of Nasdaq, our common stock may be delisted, in which case the liquidity and market price of our common stock could decline.

 

Our common stock is currently listed on Nasdaq. In order to maintain that listing, we must satisfy certain continued listing requirements. In the past, we have received deficiency letters from Nasdaq for failing to maintain compliance with such listing requirements. For example, on July 20, 2023, we received a written notification from the Staff indicating that we were not in compliance with Nasdaq Listing Rule 5450(b)(2)(A) because we had not maintained a minimum MVLS of $50,000,000 for the previous 33 consecutive business days. We were provided an initial compliance period of 180 calendar days, or until January 22, 2024, to regain compliance with the minimum MVLS requirement. Additionally, on April 18, 2023, we received a written notification from the Staff indicating we were not in compliance with Nasdaq Listing Rule 5450(a)(1), and were provided an initial compliance period of 180 calendar days, or until October 16, 2023, to regain compliance. On October 17, 2023, we received a written notification from the Staff indicating that based upon our non-compliance with Nasdaq Listing Rule 5450(a)(1), our securities were subject to delisting unless we timely requested a hearing before the Panel, which such hearing was timely requested and subsequently held on January 4, 2024. On January 16, 2024, the Panel granted our request for an exception to the Nasdaq Listing Rules until April 16, 2024, to demonstrate compliance with the Minimum Bid Price Requirement, subject to our filing all necessary documentation required to transfer our listing from the Nasdaq Global Market to Nasdaq on or before January 19, 2024, and our demonstrating compliance with the Minimum Bid Price Requirement on or before April 16, 2024. On February 1, 2024, the Nasdaq Stock Market informed us that it had approved our application to transfer our listing to Nasdaq. Our securities were transferred from the Nasdaq Global Market to Nasdaq at the opening of business on January 19, 2024.

 

If our common stock is delisted, an active trading market for our common stock may not be sustained and the market price of our common stock could decline. Delisting of our common stock could adversely affect our ability to raise additional capital through the public or private sale of equity securities, would significantly affect the ability of investors to trade our securities and would negatively affect the value and liquidity of our common stock. Delisting could also have other negative results, including the potential loss of confidence by employees, the loss of institutional investor interest and fewer business development opportunities.

 

Fluctuations in the price of our common stock, including as a result of actual or anticipated sales of shares by us and/or our directors, officers or stockholders, may make our common stock more difficult to resell.

 

 

The market price and trading volume of our common stock have been, and may continue to be, subject to significant fluctuations due not only to general stock market conditions, but also to changes in sentiment in the market regarding the industry in which we operate, our operations, business prospects or liquidity, or this offering. In addition to the risk factors discussed in our periodic reports and in this prospectus supplement, the price and volume volatility of our common stock may be affected by actual or anticipated sales of common stock by us and/or our directors, officers or stockholders, whether in the market, in connection with business acquisitions, in this offering or in subsequent public offerings. Stock markets in general have at times experienced extreme volatility unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock, regardless of our operating results.

 

As a result, these fluctuations in the market price and trading volume of our common stock may make it difficult to predict the market price of our common stock in the future, cause the value of your investment to decline and make it more difficult to resell our common stock.

 

Management will have broad discretion as to the use of the net proceeds of this offering, and we may use the net proceeds in ways in which you and other stockholders may disagree.

 

We currently intend to use the net proceeds of this offering as described in the section entitled “Use of Proceeds” on page S-8. However, our management will have broad discretion over the use and investment of the net proceeds from this offering, and, accordingly, investors in this offering will need to rely upon the judgment of our management with respect to the use of proceeds, with only limited information concerning our specific intentions Our stockholders may not agree with the manner in which our management chooses to allocate and spend the net proceeds.

 

Investors in this offering will experience immediate and substantial dilution in the net tangible book value per share of our common stock.

 

The public offering price of our common stock will be substantially higher than the net tangible book value per share. Therefore, if you purchase shares of common stock in this offering, you will pay a price per share that substantially exceeds our net tangible book value per share after this offering. If you purchase shares of common stock in this offering, you will suffer immediate and substantial dilution of $            per share, representing the difference between the public offering price of $            per share in this offering and our as adjusted net tangible book value per share as of September 30, 2023, after giving effect to this offering, and after underwriting discounts and commissions and estimated offering expenses payable by us. Please refer to the section below entitled “Dilution” for more information.

 

You may experience future dilution as a result of future equity offerings or acquisitions.

 

In order to raise additional capital, we may in the future offer additional shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that may not be the same as the price per share in this offering. We may sell shares or other securities in any future offering at a price per share that is less than the price per share paid by investors in this offering, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per share at which we sell additional shares of our common stock, or securities convertible or exchangeable into our common stock, in future transactions or acquisitions may be higher or lower than the price per share paid by investors in this offering.

 

In addition, we may engage in one or more potential acquisitions in the future, which could involve issuing our common stock as some or all of the consideration payable by us to complete such acquisitions. If we issue common stock or securities linked to our common stock, the newly issued securities may have a dilutive effect on the interests of the holders of our common stock. Additionally, future sales of newly issued shares used to effect an acquisition could depress the market price of our common stock.

 

The Pre-Funded Warrants are speculative in nature and may never have any value.

 

Commencing on the date of issuance, holders of Pre-Funded Warrants may exercise their rights to acquire our common stock and pay an exercise price per share equal to $0.001 per share, subject to certain adjustments, without expiration. Following this offering, the market value of the Pre-Funded Warrants, if any, is uncertain and there can be no assurance that the market price of our common stock will ever equal or exceed their imputed offering price.

 

There is no public market for the Pre-Funded Warrants being offered in this offering.

 

There is no established public trading market for the Pre-Funded Warrants to purchase shares of our common stock being offered in this offering, and we do not expect a market to develop. In addition, we do not intend to apply to list the Warrants on any national securities exchange or other nationally recognized trading system. Without an active market, the liquidity of the Pre-Funded Warrants will be limited.

 

Holders of Pre-Funded Warrants will have no rights as a common stockholder until such holders exercise their Pre-Funded Warrants and acquire our common stock.

 

Until holders of Pre-Funded Warrants acquire shares of our common stock upon exercise of such warrants, holders of the Warrants will have no rights with respect to the shares of our common stock underlying such Pre-Funded Warrants. Upon exercise of the Pre-Funded Warrants, the holders will be entitled to exercise the rights of a common stockholder only as to matters for which the record date occurs after the exercise date.

 

 

We do not anticipate paying cash dividends and, accordingly, stockholders must rely on share appreciation for any return on their investment.

 

We currently intend to retain our future earnings, if any, to fund the development and growth of our businesses and do not anticipate that we will declare or pay any cash dividends on our capital stock in the foreseeable future. See the section titled “Dividend Policy” in this prospectus supplement. In addition, our ability to pay dividends is limited by covenants of our existing and outstanding indebtedness and may be limited by covenants of any future indebtedness we incur. As a result, capital appreciation, if any, of our common stock will be your sole source of gain on your investment for the foreseeable future. Investors seeking cash dividends should not invest in our common stock.

 

Our common stock may become the target of a “short squeeze”.

 

In recent years, the securities of several companies have increasingly experienced significant and extreme volatility in stock price due to short sellers of common stock and buy-and-hold decisions of longer investors, resulting in what is sometimes described as a “short squeeze.” Short squeezes have caused extreme volatility in those companies and in the market and have led to the price per share of those companies to trade at a significantly inflated rate that is disconnected from the underlying value of the company. Sharp rises in a company’s stock price may force traders in a short position to buy the shares to avoid even greater losses. Many investors who have purchased shares in those companies at an inflated rate face the risk of losing a significant portion of their original investment as the price per share has declined steadily as interest in those shares have abated. We may be a target of a short squeeze, and investors may lose a significant portion or all of their investment if they purchase our shares at a rate that is significantly disconnected from our underlying value.

 

We are subject to certain contractual obligations and limitations on our ability to consummate future financings under the Promissory Note issued by us to Streeterville on November 4, 2022, as amended in March 2023, July 2023, and February 2024.

 

Pursuant to the securities purchase agreement we entered into in connection with the issuance of the Note to Streeterville, we are subject to certain restrictions on our ability to issue securities during the term of the Note. Specifically, we agreed to obtain the Lender’s consent prior to issuing any debt securities or certain equity securities where the pricing of such equity securities is tied to the public trading price of our common stock. Furthermore, we also must offer the Lender the right to purchase up to 10% of future equity and debt securities offerings, subject to certain exceptions and limitations, during the term of the Note.

 

Further, we have agreed to make certain monthly redemption payments at the request of the Lender. Our failure to pay such redemptions, when due, may result in defaults under our agreements with the Lender. If we are in default with respect to our obligations under the Note, the Lender may consider the Note immediately due and payable and may elect to substantially increase the interest rate of the Note. We may not have the required funds to pay the required note redemptions and such redemptions, or penalties in connection therewith, may have an adverse effect on our cash flows, results of operations, and ability to pay our other debts as they come due.

 

 

Use of Proceeds

 

We estimate that the net proceeds from this offering will be approximately $             (or approximately $             million if the underwriters exercise in full their option to purchase additional shares of common stock and/or Pre-Funded Warrants), based on a public offering price of $           per share or $              per Pre-Funded Warrant, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

 

We expect to use any proceeds that we receive from this offering for working capital and general corporate purposes. We may also use the proceeds from this offering to repay the Note issued to Streeterville. The Note bears interest at a rate of 9% per annum and matures in August 2024. Accordingly, we retain broad discretion over the use of the net proceeds from this offering. The precise amount and timing of the application of such proceeds will depend upon our liquidity needs and the availability and cost of other capital over which we have little or no control. As of the date of this prospectus supplement, we cannot specify with certainty all of the particular uses, and the respective amounts we may allocate to those uses, for the net proceeds we receive.

 

DIVIDEND POLICY

 

We have never declared or paid any cash dividends on our capital stock. We currently intend to retain all available funds and future earnings, if any, for the operation and expansion of our business and do not anticipate declaring or paying any dividends in the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our board of directors (the “Board”) after considering our financial condition, results of operations, capital requirements, business prospects and other factors the Board deems relevant, and subject to the restrictions contained in any financing instruments. Our ability to declare dividends may also be limited by restrictive covenants pursuant to any other future debt financing agreements.

 

 

Dilution

 

If you invest in our securities, you will experience immediate dilution to the extent of the difference between the public offering price per share of common stock that you pay in this offering and the as adjusted net tangible book value per share after this offering (excluding the shares of common stock issuable upon exercise of the Pre-Funded Warrants). The net tangible book value of our common stock as of September 30, 2023, was approximately $(6,217,449), or $(0.09) per share. Net tangible book value per share of our common stock is equal to total assets minus intangible assets, goodwill, and equity investments, less total liabilities, dividend by the total number of shares of common stock issued and outstanding as of September 30, 2023.

 

After giving effect to the issuance and sale of               shares of common stock offered hereby at a public offering price of $               per share and Pre-Funded Warrants to purchase up to                shares of common stock at a public offering price of $                per Pre-Funded Warrant, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our as adjusted net tangible book value as of September 30, 2023, would have been approximately $               million, or $               per share. The change represents an immediate increase in the net tangible book value per share of our common stock of $               per share to existing stockholders and an immediate dilution of $               per share to new investors purchasing common stock in this offering.

 

If holders of Pre-Funded Warrants exercise the Pre-Funded Warrants in full, the as adjusted net tangible book value per share of common stock after giving effect to this offering (but not the exercise of the underwriters’ option to purchase additional shares and/or Pre-Funded Warrants) would be $               per share, and the dilution in net tangible book value per share to investors purchasing common stock in this offering would be $               per share.

 

The following table illustrates this per share dilution, assuming the the underwriters do not exercise their option to purchase additional shares of common stock and the holders of the Pre-Funded Warrants do not exercise any of the Pre-Funded Warrants:

 

Public offering price per share						$
Net tangible book value per share as of September 30, 2023		$	(0.09	)
Increase in as adjusted net tangible book value per share attributable to this offering		$
As adjusted net tangible book value per share as of September 30, 2023, after giving effect to this offering						$
Dilution per share to new investors participating in the offering						$

 

The information above assumes that the underwriters do not exercise their option to purchase additional shares of common stock and/or Pre-Funded Warrants. If the underwriters exercise in full their option to purchase additional                        shares of common stock and/or Pre-Funded Warrants, our adjusted net tangible book value after this offering would be approximately $                       , or $                       per share, representing an increase in net tangible book value of approximately $                       per share to existing stockholders and immediate dilution in net tangible book value of approximately $                       per share to investors participating in this offering.

 

The table above is based on 83,919,554 shares of common stock outstanding as of September 30, 2023, and excludes:

 

·

3,450,000 shares of common stock issuable upon the exercise of the Public Warrants, at an exercise price of $11.50 per share;

 

·

2,548,849 shares of common stock reserved for future issuance pursuant to outstanding option awards, with a weighted average exercise price of $3.32 per share;

 

·

964,214 shares of common stock available for future grants under the 2021 Plan;

 

·

up to 45,000,000 shares of common stock issuable upon conversion of the Note;

	·	3,000,000 shares of common stock issuable upon the conversion of 3,000,000 shares of Series A Preferred Stock at a conversion price of $0.40 per share;
	·	3,000,000 shares of common stock issuable upon the exercise of warrants issued to certain investors pursuant to the August 2023 Purchase Agreement, at an exercise price of $0.40 per share; and
	·	the shares of common stock issuable upon exercise of the underwriters warrants issued in this offering.

 

To the extent outstanding options or warrants are exercised, including any of the Pre-Funded Warrants, or outstanding convertible securities are converted into shares of common stock, there will be further dilution to investors. In addition, to the extent that we issue additional equity securities in connection with future capital raising activities, our then-existing stockholders may experience dilution.

 

 

UNDERWRITING

 

EF Hutton LLC is acting as representative of each of the underwriters named below (the “Representative”). Subject to the terms and conditions set forth in an underwriting agreement between us and the Representative, we have agreed to sell to each underwriter named below such securities set forth opposite its name in the below table at the public offering price, less the underwriting discounts and commissions set forth on the cover page of this prospectus.

  

Underwriter		Number of Shares of Common Stock				Number of Pre-Funded Warrants
EF Hutton LLC
Total

 

The underwriting agreement provides that, subject to the terms and conditions contained therein, the underwriters are obligated to take and pay for all of the shares of common stock in the offering if any of the shares of common stock are purchased, other than the shares of common stock covered by the over-allotment option described below. If an underwriter defaults, the underwriting agreement provides that the purchase commitments of the non-defaulting underwriters may be increased or the underwriting agreement may be terminated.

 

Over-Allotment Option

 

We have granted to the Representative an option, exercisable no later than 45 calendar days after the date of the underwriting agreement, to purchase up to an additional                      shares of common stock and/or Pre-Funded Warrants (15% of shares and shares subject to Pre-Funded Warrants sold in this offering) at the public offering prices, less the underwriting discounts. If the Representative exercises this option, it will be obligated, subject to conditions contained in the underwriting agreement, to purchase a number of additional shares and/or Pre-Funded Warrants on the same terms as those on which the shares and Pre-Funded Warrants are being offered.

 

Discounts and Commissions

 

The underwriters propose to offer the shares of common stock and Pre-Funded Warrants initially at the public offering prices on the cover page of this prospectus. After the initial offering, the public offering prices, concession or any other term of the offering may be changed.

 

The following table summarizes the underwriting discounts and commissions and proceeds, before expenses, to us, assuming both no exercise and full exercise of the over-allotment option:

 

Per Share

Per Pre-Funded Warrant

Total Without Over-Allotment Option

Total With Over-Allotment Option

Public offering price

$

$

$

$

Underwriting discounts and commissions (8.0%)(1)

$

$

$

$

Proceeds to us, before fees and expenses

$

$

$

$

 

(1)	We have agreed to pay a non-accountable expense allowance to the Representative equal to 1% of the gross proceeds received in this offering which is not included in the underwriting discounts and commission.

 

We estimate expenses payable by us in connection with this offering, other than the underwriting discounts and commissions and non-accountable expense allowance referred to above, will be approximately $               ($               if the over-allotment option is exercised in full), which includes certain expenses incurred by the underwriters in connection with this offering that will be reimbursed by us. We have agreed to reimburse the Representative for all reasonable out-of-pocket costs and expenses incident to the performance of its obligations under the underwriting agreement (including, without limitation, the fees and expenses of its outside attorneys), provided that, excluding certain expenses related to indemnification and Blue-Sky and FINRA filings, if any, such costs and expenses shall not exceed $100,000.

 

 

We have also agreed to indemnify the underwriters against certain liabilities, including civil liabilities under the Securities Act or to contribute to payments that the underwriters may be required to make in respect of those liabilities.

 

Underwriters’ Warrants

 

Upon closing of this offering, we have agreed to issue to the Representative warrants, or the underwriter warrants, to purchase               shares of our common stock (5% of the aggregate number of shares of common stock and Pre-Funded Warrants sold in this offering) as a portion of the underwriting compensation payable to the underwriters in connection with this offering. The underwriter warrants will be exercisable at a per share exercise price equal to 110% of the public offering price per share in this offering. The underwriter warrants are exercisable at any time and from time to time, in whole or in part, during the four and one half year period commencing 180 days from the commencement of sales in this offering.

 

In addition, the warrants provide for registration rights upon request, in certain cases. The sole demand registration right provided will not be greater than four and one-half years beginning on the Initial Exercise Date in compliance with FINRA Rule 5110(g)(8)(C). The piggyback registration rights provided will not be greater than five years from the initial exercise date of the underwriter warrants in compliance with FINRA Rule 5110(g)(8)(D). We will bear all fees and expenses attendant to registering the securities issuable on exercise of the warrants other than underwriting commissions incurred and payable by the holders. The exercise price and number of shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend or our recapitalization, reorganization, merger or consolidation. However, the warrant exercise price or underlying shares will not be adjusted for issuances of shares of common stock at a price below the warrant exercise price.

 

 

Tail Financing

 

We agreed to pay the Representative a cash fee equal to eight percent (8%) of the gross proceeds received by us from the sale of any equity, debt and/or equity derivative instruments to any investor actually introduced by the Representative to us during the term of engagement with it, in connection with any public or private financing or capital raise (each a “Tail Financing”), and such Tail Financing is consummated at any time during the term of our engagement with them or within the six month period following the expiration or termination of our engagement with them (the “Tail Period”), provided that such Tail Financing is by a party actually introduced to the Company in an offering in which we had direct knowledge of such party’s participation

 

Lock-Up Agreements

 

In connection with this offering, our executive officers and directors have agreed with the Representative that, subject to certain customary exceptions, without the prior written consent of the Representative, for a period commencing on the date of the lock-up agreement and ending on the date that is the 90 days after the closing of the offering, that they shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company.

 

Company Standstill

 

In connection with this offering, we have agreed that, without the prior written consent of the Representative, for a period commencing on the date of the underwriting agreement and ending on the date that is 90 days after the closing of the offering, we will not (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company, (ii) file or caused to be filed any registration statement with the Commission relating to the offering of any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company, (iii) complete any offering of debt securities of the Company, other than entering into a line of credit with a traditional bank, or (iv) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii), (iii) or (iv) above is to be settled by delivery of shares of capital stock of the Company or such other securities, in cash or otherwise.

 

These restrictions above do not apply in certain situations, including, among others:

 

●

the issuance and sale of shares of common stock and/or Pre-Funded Warrants (including any shares of common stock issuable upon exercise of the Pre-Funded Warrants) to be sold on connection with the offering;

 

●

the issuance by the Company of shares of common stock upon the exercise of a stock option or warrant or the conversion of a security outstanding on the date hereof; and

 

●

the issuance by the Company of stock options, shares of capital stock of the Company or other awards under any equity compensation plan of the Company.

 

 

Nasdaq Listing

 

Our common stock and the Public Warrants are listed on Nasdaq under the symbols “NRXP” and “NRXPW”, respectively. 

 

Price Stabilization, Short Positions and Penalty Bids

 

In connection with this offering, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of our common stock. Specifically, the underwriters may over-allot in connection with this offering by selling more shares of common stock than are set forth on the cover page of this prospectus. This creates a short position in our common stock for its own account. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares of common stock over-allotted by the underwriters is not greater than the number of shares of our common stock that they may purchase in the over-allotment option. In a naked short position, the number of shares of our common stock involved is greater than the number of shares of common stock in the over-allotment option. To close out a short position, the underwriters may elect to exercise all or part of the over-allotment option. The underwriters may also elect to stabilize the price of our common stock or reduce any short position by bidding for, and purchasing, our common stock in the open market.

 

The underwriters may also impose a penalty bid. This occurs when a particular underwriter or dealer repays selling concessions allowed to it for distributing a security in this offering because the underwriter repurchases that security in stabilizing or short covering transactions.

 

Finally, the underwriters may bid for, and purchase, shares of our common stock in market making transactions, including “passive” market making transactions as described below.

 

These activities may stabilize or maintain the market price of our common stock at a price that is higher than the price that might otherwise exist in the absence of these activities. The underwriters are not required to engage in these activities and may discontinue any of these activities at any time without notice.

 

In connection with this offering, the underwriters and selling group members, if any, or their affiliates may engage in passive market making transactions in our common stock immediately prior to the commencement of sales in this offering, in accordance with Rule 103 of Regulation M under the Exchange Act. Rule 103 generally provides that:

 

●

a passive market maker may not effect transactions or display bids for our common stock in excess of the highest independent bid price by persons who are not passive market makers;

 

●

net purchases by a passive market maker on each day are generally limited to 30% of the passive market maker’s average daily trading volume in our common stock during a specified two-month prior period or 200 shares, whichever is greater, and must be discontinued when that limit is reached; and

 

●

passive market making bids must be identified as such.

 

Electronic Distribution

 

A prospectus in electronic format may be made available on the websites maintained by the underwriters. The Representative may agree to allocate a number of shares to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the Representative to underwriters that may make internet distributions on the same basis as other allocations. In connection with the offering, the underwriters or syndicate members may distribute prospectuses electronically. No forms of electronic prospectus other than prospectuses that are printable as Adobe® PDF will be used in connection with this offering.

 

Other than the prospectus in electronic format, the information on any underwriter’s website and any information contained in any other website maintained by an underwriter is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or any underwriter in its capacity as underwriter and should not be relied upon by investors.

 

Affiliations

 

Each underwriter and its affiliates may provide, from time to time, investment banking and financial advisory services to us in the ordinary course of business, for which they may receive customary fees and commissions.

 

Foreign Regulatory Restrictions on Purchase of our Shares

 

We have not taken any action to permit a public offering of our shares outside the United States or to permit the possession or distribution of this prospectus outside the United States. People outside the United States who come into possession of this prospectus must inform themselves about and observe any restrictions relating to this offering of our shares and the distribution of this prospectus outside the United States.

 

 

DESCRIPTION OF SECURITIES BEING OFFERED

 

The following is a description of our capital stock and certain provisions of our Second Amended and Restated Certificate of Incorporation, Amended and Restated By-Laws, and certain provisions of applicable law. The following is only a summary and is qualified by applicable law and by the provisions of our Second Amended and Restated Certificate of Incorporation and Amended and Restated By-Laws, copies of which are included as exhibits to the registration statement of which this prospectus forms a part. We are incorporated in the State of Delaware. The rights of our stockholders are generally covered by Delaware law and our Second Amended and Restated Certificate of Incorporation and Amended and Restated By-Laws. The terms of our capital stock are therefore subject to Delaware law.

 

We are offering                     shares of our common stock and                    Pre-Funded Warrants to purchase shares of our common stock. We are also registering the shares of common stock issuable from time to time upon exercise of the Pre-Funded Warrants offered hereby.

 

General

 

Our authorized capital stock consists of 500,000,000 shares of common stock, $0.001 par value per share, and 50,000,000 shares of preferred stock, $0.001 par value per share. As of the date of this prospectus supplement (i) 86,675,580 shares of common stock were issued and outstanding; and (ii) 3,000,000 shares of Series A Preferred Stock were issued and outstanding.

 

Common Stock

 

The material terms and provisions of our common stock are described under the caption “Description of Capital Stock” in the accompanying prospectus and are incorporated herein by reference.

 

Pre-Funded Warrants

 

The following summary of certain terms and provisions of the Pre-Funded Warrants that are being offered hereby is not complete and is subject to, and qualified in its entirety by, the provisions of the Pre-Funded Warrant, the form of which will be filed as an exhibit to a Current Report on Form 8-K in connection with this offering and incorporated by reference into the registration statement of which this prospectus supplement forms a part. Prospective investors should carefully review the terms and provisions of the form of Pre-Funded Warrant for a complete description of the terms and conditions of the Pre-Funded Warrants.

 

The Pre-Funded Warrants will be issued in certificated form only.

 

Duration and exercise price

 

Each Pre-Funded Warrant offered hereby has an initial exercise price per share equal to $0.001. The Pre-Funded Warrants are immediately exercisable and have an indefinite term. The exercise price and number of shares of common stock issuable upon exercise is subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting our common stock and the exercise price.

 

Exercisability

 

The Pre-Funded Warrants will be exercisable, at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment in full for the number of shares of our common stock purchased upon such exercise (except in the case of a cashless exercise as discussed below). A holder (together with its affiliates) may not exercise any portion of such holder’s Pre-Funded Warrant to the extent that the holder would own more than 4.99% (or, at the election of the purchaser, 9.99%) of the outstanding shares of common stock immediately after exercise, except that upon prior notice from the holder to us, the holder may increase the amount of ownership of outstanding shares of common stock after exercising the holder’s Pre-Funded Warrants up to 9.99% of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Pre-Funded Warrants. No fractional shares of common stock will be issued in connection with the exercise of a Pre-Funded Warrant. In lieu of fractional shares, we will either pay the holder an amount in cash equal to the fractional amount multiplied by the exercise price or round up to the next whole share.

 

 

Cashless exercise

 

The Pre-Funded Warrants may be exercised, in whole or in part, by means of cashless exercise. In lieu of making the cash payment otherwise contemplated to be made to us upon such exercise in payment of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either in whole or in part) the net number of shares of common stock determined according to a formula set forth in the Pre-Funded Warrants.

 

Fundamental transactions

 

In the event of any fundamental transaction, as described in the Pre-Funded Warrants and generally including any merger with or into another entity, sale of all or substantially all of our assets, tender offer or exchange offer, or reclassification of our shares of common stock, upon any subsequent exercise of a Pre-Funded Warrant, the holder will have the right to receive as alternative consideration, for each share of common stock that would have been issuable upon such exercise immediately prior to the occurrence of such fundamental transaction, the number of shares of common stock of the successor or acquiring corporation of our company, if it is the surviving corporation, and any additional consideration receivable upon or as a result of such transaction by a holder of the number of shares of common stock for which the Pre-Funded Warrant is exercisable immediately prior to such event.

 

Transferability

 

Subject to applicable laws, a Pre-Funded Warrant or the rights thereunder may be transferred or assigned, in whole or in part. The ownership of the Pre-Funded Warrants and any transfers of the Pre-Funded Warrants will be registered in a warrant register maintained by the warrant agent. We will initially act as warrant agent.

 

Exchange listing

 

There is no trading market available for the Pre-Funded Warrants on any securities exchange or nationally recognized trading system. We do not intend to list the Pre-Funded Warrants on any securities exchange or nationally recognized trading system.

 

Right as a stockholder

 

Except as otherwise provided in the Pre-Funded Warrants or by virtue of such holder’s ownership of shares of our common stock, the holders of the Pre-Funded Warrants do not have the rights or privileges of holders of our common stock, including any voting rights, until they exercise their Pre-Funded Warrants.

 

 

MATERIAL U.S. Federal Income TAX CONSIDERATIONS

 

The following is a summary of the material U.S. federal income tax considerations relating to the purchase, ownership and disposition of our common stock purchased in this offering but is for general information purposes only and does not purport to be a complete analysis of all the potential tax considerations relating thereto. This summary is based upon the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), existing and proposed Treasury regulations promulgated thereunder, administrative rulings, and judicial decisions, all as of the date hereof. These authorities may be changed, possibly retroactively, so as to result in U.S. federal income tax consequences different from those set forth below. There can be no assurance that the Internal Revenue Service (the “IRS”) will not challenge one or more of the tax consequences described herein, and we have not obtained, and do not intend to obtain, an opinion of counsel or ruling from the IRS with respect to the U.S. federal income tax considerations relating to the purchase, ownership or disposition of our common stock.

 

This summary does not address any alternative minimum tax considerations, any considerations regarding the tax on net investment income, or the tax considerations arising under the laws of any state, local or non-U.S. jurisdiction, or under any non-income tax laws, including U.S. federal gift and estate tax laws. In addition, this summary does not address tax considerations applicable to an investor’s particular circumstances or to investors that may be subject to special tax rules, including, without limitation:

 

·

banks, insurance companies, or other financial institutions;

 

·

tax-exempt organizations or governmental organizations;

 

·

regulated investment companies and real estate investment trusts;

 

·

controlled foreign corporations, passive foreign investment companies and corporations that accumulate earnings to avoid U.S. federal income tax;

 

·

brokers or dealers in securities or currencies;

 

·

traders in securities that elect to use a mark-to-market method of accounting for their securities holdings;

 

·

persons that own, or are deemed to own, more than five percent of our common stock (except to the extent specifically set forth below);

 

·

tax-qualified retirement plans;

 

·

certain former citizens or long-term residents of the United States;

 

·

partnerships or entities or arrangements classified as partnerships for U.S. federal income tax purposes and other pass-through entities (and investors therein);

 

·

persons who hold our common stock as a position in a hedging transaction, “straddle,” “conversion transaction,” or other risk reduction transaction or integrated investment;

 

·

persons who hold or receive our common stock pursuant to the exercise of any employee stock option or otherwise as compensation;

 

·

persons who do not hold our common stock as a capital asset within the meaning of Section 1221 of the Code; or

 

·

persons deemed to sell our common stock under the constructive sale provisions of the Code.

 

 

In addition, if a partnership (or entity or arrangement classified as a partnership for U.S. federal income tax purposes) holds our common stock, the tax treatment of a partner in such partnership generally will depend on the status of the partner and upon the activities of the partnership. Accordingly, partnerships that hold our common stock, and partners in such partnerships, should consult their tax advisors.

 

You are urged to consult your own tax advisors with respect to the application of the U.S. federal income tax laws to your particular situation, as well as any tax consequences of the purchase, ownership, and disposition of our common stock arising under the U.S. federal estate or gift tax laws or under the laws of any state, local, non-U.S., or other taxing jurisdiction, or under any applicable tax treaty.

 

Consequences to U.S. Holders

 

The following is a summary of the U.S. federal income tax consequences that will apply to a U.S. holder of our common stock. For purposes of this discussion, you are a “U.S. holder” if, for U.S. federal income tax purposes, you are a beneficial owner of our common stock, other than a partnership, that is:

 

·

an individual citizen or resident of the United States;

 

·

a corporation or other entity taxable as a corporation created or organized in the United States or under the laws of the United States, any State thereof or the District of Columbia;

 

·

an estate whose income is subject to U.S. federal income tax regardless of its source; or

 

·

a trust (x) whose administration is subject to the primary supervision of a U.S. court and which has one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) who have the authority to control all substantial decisions of the trust or (y) which has made a valid election to be treated as a “United States person.”

 

Distributions

 

As described in the section titled “Dividend Policy,” we have not declared or paid cash dividends on our common stock and do not anticipate paying any dividends on our common stock in the foreseeable future. However, if we do make distributions on our common stock, those payments will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. To the extent those distributions exceed both our current and our accumulated earnings and profits, the excess will constitute a return of capital and will first reduce your basis in our common stock, but not below zero, and then will be treated as gain from the sale of stock as described below under “—Sale, Exchange or Other Taxable Disposition of Our Common Stock.”

 

Dividend income may be taxed to an individual U.S. holder at rates applicable to long-term capital gains, provided that a minimum holding period and other limitations and requirements are satisfied. Any dividends that we pay to a U.S. holder that is a taxable corporation generally will qualify for a dividends-received deduction allowed to U.S. corporations in respect of dividends received from other U.S. corporations equal to a portion of any dividends received, subject to generally applicable limitations on that deduction. U.S. holders should consult their own tax advisors regarding the holding period and other requirements that must be satisfied in order to qualify for the reduced tax rate on dividends or the dividends-received deduction.

 

Sale, Exchange, or Other Taxable Disposition of Our Common Stock

 

A U.S. holder will generally recognize capital gain or loss on the sale, exchange, or other taxable disposition of our common stock. The amount of gain or loss will equal the difference between the amount realized on the sale and such U.S. holder’s tax basis in such common stock. The amount realized will include the amount of any cash and the fair market value of any other property received in exchange for such common stock. Gain or loss will be long-term capital gain or loss if the U.S. holder has held the common stock for more than one year. Long-term capital gains of non-corporate U.S. holders are generally taxed at preferential rates. The deductibility of capital losses is subject to certain limitations.

 

 

Consequences to Non-U.S. Holders

 

The following is a summary of the U.S. federal income tax consequences that will apply to a non-U.S. holder of our common stock. A “non-U.S. holder” is a beneficial owner of our common stock (other than a partnership or an entity or arrangement treated as a partnership for U.S. federal income tax purposes) that, for U.S. federal income tax purposes, is not a U.S. holder.

 

Distributions

 

Distributions will be treated as described above under “Consequences to U.S. Holders—Distributions.” Subject to the discussion below regarding effectively connected income, any dividend paid to a non-U.S. holder generally will be subject to U.S. withholding tax either at a rate of 30% of the gross amount of the dividend or such lower rate as may be specified by an applicable income tax treaty. In order to receive a reduced treaty rate, a non-U.S. holder must provide us with an IRS Form W-8BEN, IRS Form W-8BEN-E or other applicable IRS Form W-8 properly certifying qualification for the reduced rate. These forms must be updated periodically. A non-U.S. holder eligible for a reduced rate of U.S. withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for a refund with the IRS. If a non-U.S. holder holds our common stock through a financial institution or other agent acting on the non-U.S. holder’s behalf, the non-U.S. holder will be required to provide appropriate documentation to the agent, which then may be required to provide certification to us or our paying agent, either directly or through other intermediaries.

 

Dividends received by a non-U.S. holder that are effectively connected with its conduct of a U.S. trade or business (and, if required by an applicable income tax treaty, attributable to a permanent establishment or fixed base maintained by the non-U.S. holder in the United States) are generally exempt from such withholding tax if the non-U.S. holder satisfies certain certification and disclosure requirements. In order to obtain this exemption, the non-U.S. holder must provide us with an IRS Form W-8ECI or other applicable IRS Form W-8 properly certifying such exemption. Such effectively connected dividends, although not subject to withholding tax, are taxed at the same graduated U.S. federal income tax rates applicable to U.S. holders, net of certain deductions and credits. In addition, dividends received by a corporate non-U.S. holder that are effectively connected with its conduct of a U.S. trade or business may also be subject to a branch profits tax at a rate of 30% or such lower rate as may be specified by an applicable income tax treaty. Non-U.S. holders should consult their own tax advisors regarding any applicable tax treaties that may provide for different rules.

 

Gain on Sale, Exchange, or Other Taxable Disposition of Our Common Stock

 

Subject to the discussion below regarding backup withholding and foreign accounts, a non-U.S. holder generally will not be required to pay U.S. federal income tax on any gain realized upon the sale, exchange, or other taxable disposition of our common stock unless:

 

·

the gain is effectively connected with the non-U.S. holder’s conduct of a U.S. trade or business (and, if required by an applicable income tax treaty, the gain is attributable to a permanent establishment or fixed base maintained by the non-U.S. holder in the United States);

 

·

the non-U.S. holder is a non-resident alien individual who is present in the United States for a period or periods aggregating 183 days or more during the calendar year in which the sale or disposition occurs and certain other conditions are met; or

 

·

shares of our common stock constitute U.S. real property interests by reason of our status as a “United States real property holding corporation” (a “USRPHC”) for U.S. federal income tax purposes at any time within the shorter of the five-year period preceding the non-U.S. holder’s disposition of, or the non-U.S. holder’s holding period for, our common stock.

 

 

We believe that we are not currently a USRPHC for U.S. federal income tax purposes, and the remainder of this discussion so assumes. However, because the determination of whether we are a USRPHC depends on the fair market value of our U.S. real property relative to the fair market value of our other business assets, there can be no assurance that we will not become a USRPHC in the future. Even if we become a USRPHC, however, if our common stock becomes regularly traded on an established securities market (as defined by applicable Treasury regulations), such common stock will be treated as U.S. real property interests only if the non-U.S. holder actually or constructively held more than five percent of such regularly traded common stock at any time during the shorter of the five-year period preceding the non-U.S. holder’s disposition of, or the non-U.S. holder’s holding period for, our common stock.

 

If the non-U.S. holder is described in the first bullet above, it will be required to pay tax on the net gain derived from the sale, exchange, or other taxable disposition under regular graduated U.S. federal income tax rates, and a corporate non-U.S. holder described in the first bullet above also may be subject to the branch profits tax at a rate of 30%, or such lower rate as may be specified by an applicable income tax treaty. An individual non-U.S. holder described in the second bullet above will be required to pay a flat 30% tax (or such lower rate specified by an applicable income tax treaty) on the gain derived from the sale, exchange, or other taxable disposition, which gain may be offset by U.S. source capital losses for the year (provided the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses). Non-U.S. holders should consult their own tax advisors regarding the withholding rules that may be applicable to the non-U.S. holder.

 

Backup Withholding and Information Reporting

 

Generally, we must report annually to the IRS the amount of dividends paid to you, your name and address, and the amount of tax withheld, if any. A similar report will be sent to you. Pursuant to applicable income tax treaties or other agreements, the IRS may make these reports available to tax authorities in your country of residence if you reside outside of the United States.

 

Payments of dividends on or of proceeds from the disposition of our common stock made to you may be subject to information reporting and backup withholding. Backup withholding may apply at a current rate of 24% unless you (i) provide the payor with a correct taxpayer identification number and comply with applicable certification requirements, or (ii) establish an exemption, for example, by properly certifying your non-U.S. status on an IRS Form W-8BEN or IRS Form W-8BEN-E or other applicable IRS Form W-8. Notwithstanding the foregoing, backup withholding and information reporting may apply if either we or our paying agent has actual knowledge, or reason to know, that you are a U.S. person that is not an exempt recipient.

 

Backup withholding is not an additional tax; rather, the U.S. federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund or credit may generally be obtained from the IRS, provided that the required information is furnished to the IRS in a timely manner.

 

Foreign Account Tax Compliance Act

 

The Foreign Account Tax Compliance Act (“FATCA”) generally imposes withholding tax at a rate of 30% on dividends on our common stock paid to a “foreign financial institution” (as specially defined under these rules), unless such institution enters into an agreement with the U.S. government to, among other things, withhold on certain payments and to collect and provide to the U.S. tax authorities substantial information regarding the U.S. account holders of such institution (which includes certain equity and debt holders of such institution, as well as certain account holders that are foreign entities with U.S. owners) or otherwise establishes an exemption. FATCA also generally imposes a U.S. federal withholding tax of 30% on dividends on our common stock paid to a “non-financial foreign entity” (as specially defined for purposes of these rules) unless such entity provides the withholding agent with a certification identifying certain substantial direct and indirect U.S. owners of the entity, certifies that there are no U.S. owners, or otherwise establishes an exemption. The withholding provisions under FATCA generally apply to dividends paid by us. Under certain circumstances, a non-U.S. holder might be eligible for refunds or credits of such taxes. An intergovernmental agreement between the United States and an applicable foreign country may modify the requirements described in this paragraph. Non-U.S. holders should consult their own tax advisors regarding the possible implications of this legislation on their investment in our common stock.

 

Each prospective investor should consult its own tax advisor regarding the particular U.S. federal, state and local and non-U.S. consequences of purchasing, owning and disposing of our common stock, including the consequences of any proposed changes in applicable laws.

 

 

Legal Matters

 

The validity of the common stock being offered hereby will be passed upon for us by Haynes and Boone, LLP, New York, New York. Sichenzia Ross Ference Carmel LLP, New York, New York, is counsel to the underwriters in connection with this offering.

 

Experts

 

The consolidated financial statements of NRx Pharmaceuticals, Inc. as of December 31, 2022 and 2021, and for each of the years then ended have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of such firm as experts in accounting and auditing.

 

Where You Can Find More Information

 

We file annual, quarterly and current reports, proxy statements and other information with the SEC. The SEC maintains an Internet website at http://www.sec.gov which contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Our SEC filings are available to the public from the SEC’s Internet website.

 

This prospectus supplement and the accompanying prospectus are part of a registration statement that we have filed with the SEC relating to the securities to be offered. This prospectus supplement and the accompanying prospectus omit some of the information we have included in the registration statement and the accompanying exhibits and schedules in accordance with the rules and regulations of the SEC, and we refer you to the omitted information. The statements this prospectus supplement makes pertaining to the content of any contract, agreement or other document that is an exhibit to the registration statement necessarily are summaries of their material provisions and do not describe all provisions, exceptions and qualifications contained in those contracts, agreements or documents. You should read those contracts, agreements or documents for information that may be important to you. The registration statement, exhibits and schedules are available at the SEC’s Public Reference Room or through its Internet website.

 

Incorporation of Certain Documents by Reference

 

The SEC allows us to “incorporate by reference” much of the information we file with the SEC, which means that we can disclose important information to you by referring you to those publicly available documents. The information that we incorporate by reference in this prospectus supplement is considered to be part of this prospectus supplement. Because we are incorporating by reference future filings with the SEC, this prospectus supplement is continually updated and those future filings may modify or supersede some of the information included or incorporated in this prospectus supplement. This means that you must look at all of the SEC filings that we incorporate by reference to determine if any of the statements in this prospectus supplement or in any document previously incorporated by reference have been modified or superseded. This prospectus supplement incorporates by reference the documents listed below and any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (in each case, other than information furnished under Item 2.02 or Item 7.01 of Form 8-K), on or after the date of this prospectus supplement until the earlier of the date on which all of the securities registered hereunder have been sold or the registration statement of which this prospectus supplement and the accompanying prospectus form a part of have been withdrawn:

 

·

Our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 31, 2023, as amended on Form 10-K/A on May 1, 2023, and May 26, 2023, respectively;

 

	·	Our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023, and September 30, 2023, filed with the SEC on May 15, 2023, August 14, 2023, and November 14, 2023, respectively;
	·	Our Current Reports on Form 8-K, filed with the SEC on February 2, 2023, February 13, 2023, February 23, 2023, February 24, 2023, March 3, 2023, March 9, 2023 (as amended on Form 8-K/A on March 14, 2023), April 21, 2023, June 5, 2023, June 6, 2023 (as amended on Form 8-K/A on June 7, 2023), July 28, 2023, August 14, 2023, August 31, 2023, September 1, 2023, September 14, 2023, October 23, 2023, November 21, 2023, November 22, 2023, December 21, 2023, December 29, 2023, January 23, 2024, February 2, 2024, February 14, 2024 and February 14, 2024; and

 

 

·

The description of our common stock contained in or incorporated into our Registration Statement on Form 8-A, filed with the SEC on November 20, 2017, and any amendment or report updating that description.

 

We maintain an Internet website at www.nrxpharma.com. The information contained in, or accessible through, our website does not constitute a part of this prospectus supplement or the accompanying prospectus. We have included our website address in this prospectus supplement solely as an inactive textual reference.

 

You should not assume that the information in this prospectus supplement and the accompanying prospectus, or any document incorporated by reference herein or therein is accurate as of any date other than the date of the applicable document. Any statement contained in a document incorporated or deemed to be incorporated by reference into this prospectus supplement and the accompanying prospectus 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 or the accompanying prospectus or any other subsequently filed document that is deemed to be incorporated by reference into this prospectus supplement modifies or supersedes the statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.

 

You may request a copy of any or all documents referred to above that have been or may be incorporated by reference into this prospectus supplement (excluding certain exhibits to the documents) at no cost, by writing or calling us at the following address or telephone number:

 

NRx Pharmaceuticals, Inc.

Richard Narido

Interim Chief Financial Officer

1201 North Market Street, Suite 111

Wilmington, Delaware 19801

(484) 254-6134

 

 

 

 

 

Shares of Common Stock

 

Pre-Funded Warrants to Purchase                                      Shares of Common Stock

 

PRELIMINARY PROSPECTUS SUPPLEMENT

 

 

 

 

February            , 2024

 

 

 

 

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