Item
1.01 Entry into a Material Definitive Agreement.
On
August 25, 2021, Aditxt, Inc. (the “Company”) entered into a securities purchase agreement (the “Purchase
Agreement”) with certain institutional investors, pursuant to which the Company agreed to sell to such investors an aggregate
of 4,583,334 shares of common stock of the Company (the “Common Stock”) at a purchase price of $2.40 per share (the
“Shares”). The Shares were offered by the Company pursuant to its shelf registration statement on Form S-3 (File No.
333-257645), which was declared effective by the Securities and Exchange Commission on July 13, 2021.
Concurrently
with the sale of the Shares, pursuant to the Purchase Agreement in a concurrent private placement, for each share of common stock
purchased by an investor, such investor will receive from the Company an unregistered warrant (the “Warrant”) to purchase
one share of common stock. The warrants have an exercise price of $2.53 per share, and are exercisable for a five year period commencing
six months from the date of issuance.
The
Company offered the Shares for aggregate gross proceeds of approximately $11.0 million, before commissions and expenses (the “Offering”).
Subject to certain beneficial ownership limitations, the Warrants will be exercisable at an exercise price equal to $2.53 per share,
subject to adjustments as provided under the terms of the Warrants, and are exercisable for a five year period commencing six months
from the date of issuance.
The
closing of the sales of these securities under the Purchase Agreement is expected to take place on August 30, 2021.
The
net proceeds from the transactions were approximately $10.1 million, after deducting certain fees due to the placement agent and the
Company’s estimated transaction expenses, will be used to fund a $6.5M loan to a biopharmaceutical company commercializing COVID-19
antiviral oral therapy, and for general corporate and working capital purposes, including the purchase of fixed assets.
The
Warrants and the shares issuable upon exercise of the Warrants were sold without registration under the Securities Act of 1933 (the “Securities
Act”) in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering
and Rule 506 promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions under applicable
state laws.
The
representations, warranties and covenants contained in the Purchase Agreement were made solely for the benefit of the parties to the
Purchase Agreement. In addition, such representations, warranties and covenants (i) are intended as a way of allocating the risk between
the parties to the Purchase Agreement 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 Purchase Agreement is included
with this filing only to provide investors with information regarding the terms of the 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
Purchase Agreement, which subsequent information may or may not be fully reflected in public disclosures.
On
August 25, 2021, the Company entered into a Placement Agent Agreement with Dawson James Securities, Inc., as exclusive placement agent
(the “Placement Agent”), pursuant to which the Placement Agent has agreed to act as placement agent on a reasonable “best
efforts” basis in connection with the above offering. The Company has agreed to pay the Placement Agent an aggregate fee equal
to 7.0% of the gross proceeds from the sale of shares of Common Stock and the private placement Warrants in this offering. The Company
has also agreed to issue the Placement Agent a warrant to purchase 229,166 shares (5.0%
of the number of shares sold in the offering) at an exercise price of 125% of public offering price in this offering (or $3.00 per share),
and to reimburse the Placement Agent up to $50,000 for expenses.
Pursuant
to the terms of the Purchase Agreement and subject to certain exceptions as set forth in the Purchase Agreement, from the date of the
Purchase Agreement until thirty (30) days after the Closing Date, neither the Company nor any Subsidiary shall issue, enter into any
agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents. In addition,
until the earlier of (i) one (1) year from the date of this Agreement and (ii) such time as no Purchaser holds any of the Warrants, the
Company is prohibited from entering into a Variable Rate Transaction (as defined in the Purchase Agreement), provided that the Company
shall be permitted to enter into and utilize an at-the-market offering facility with a registered broker dealer as selling agent commencing
thirty (30) days following the closing of the offering.
On
August 30, 2021, we entered into a defeasance and waiver agreement (the “Waiver Agreement”) with the holder (the “Noteholder”)
of the senior secured convertible promissory note, issued on January 25, 2021 (the “January 2021 Note”), pursuant to which
the Noteholder has agreed in exchange for (a) a cash payment by the Company to the Convertible Noteholder of $1.2 million (the “Cash
Payment”), (b) a waiver, in part, of the conversion price adjustment provision such that the January 2021 Note shall be convertible
into 4,802,497 shares of Common Stock (without giving effect to the conversion notices received by the Company from the Noteholder prior
to the date hereof totaling 1,005,748 shares) (the “Shares”) and (c) a voluntary and permanent reduction by the Company of
the exercise price of the warrant to purchase 800,000 shares of common stock of the Company (the “January 2021 Warrant”)
to $2.53 per share, effective as of the Effective Time (as defined below). In addition, the Noteholder agreed that it will forbear from
exercising certain rights available to it under the January 2021 Note until October 15, 2021 and that, upon receipt of the Cash Payment
(the “Effective Time”), all such rights shall be null and void other than the Company’s obligations to deliver the
Shares.
As
of the date hereof, we have issued an aggregate of 1,005,748 shares to the holder pursuant to conversions of the Note, and the principal
balance remaining due on the Note is $4,421,053.
The
foregoing description of the form of Warrant, form of Purchase Agreement, Placement Agent Agreement, form of Placement Agent Warrant
and Waiver Agreement is not complete and is qualified in its entirety by reference to the full text of the form of Warrant, form of Purchase
Agreement, Placement Agent Agreement, form of Placement Agent Warrant and Waiver Agreement, copies of which are filed as Exhibits 4.1,
10.1, 10.2, 10.3 and 10.4, respectively, to this Current Report on Form 8-K and are incorporated by reference herein.
The
legal opinion and consent of Sheppard, Mullin, Richter & Hampton LLP relating to the securities is filed as Exhibit 5.1 to this Current
Report on Form 8-K and is incorporated herein by reference.