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Item
1.01.
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Entry
into a Material Definitive Agreement.
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On
January 24, 2021, we entered into a securities purchase agreement with certain institutional investors and accredited investors
for the sale by us of an aggregate of 15,455,960 unregistered shares of our common stock and unregistered warrants to purchase
up to an aggregate of 7,727,980 shares of our common stock, at a purchase price of $1.294 per share and associated warrant. The
aggregate gross proceeds for the sale of the shares and warrants were approximately $20.0 million. Subject to certain ownership
limitations, the warrants are exercisable immediately upon issuance at an exercise price equal to $1.231 per share of common stock,
subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five and one-half years from
the issuance date. We closed the sale of these securities on January 27, 2021.
The
net proceeds to us from the transactions, after deducting placement agent fees and expenses and the estimated offering expenses,
are expected to be approximately $18.4 million, excluding the proceeds, if any, from the exercise of the warrants. We intend to
use the net proceeds from the offering for general corporate purposes, including pre-clinical and clinical development of our
product candidates and working capital and capital expenditures.
The
sales of common stock and warrants and the shares issuable upon exercise of the warrants were sold and issued 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 securities purchase agreement were made solely for the benefit of the
parties to the securities purchase agreement. In addition, such representations, warranties and covenants (i) are intended as
a way of allocating the risk between the parties to the securities 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, our company. Accordingly, the form of securities purchase agreement is included with this filing only to provide
investors with information regarding the terms of the transactions. Moreover, information concerning the subject matter of the
representations and warranties may change after the date of the securities purchase agreement, which subsequent information may
or may not be fully reflected in public disclosures.
In
connection with the sale of the common stock and warrants, on January 24, 2021, we also entered into a registration rights agreement
with each investor whereby we agreed to file a registration statement within five days to register for resale under the Securities
Act the shares of common stock and the shares of common stock issuable upon exercise of the investor warrants.
We
entered into an engagement letter with H.C. Wainwright & Co., LLC, dated January 23, 2021, pursuant to which Wainwright agreed
to serve as exclusive placement agent for the issuance and sale of the shares of common stock and warrants. We paid Wainwright
an aggregate fee of $1.4 million, which is equal to 7.0% of the gross proceeds received by us from the sale of the securities
in the transactions. Pursuant to the engagement letter, we also granted to Wainwright and its designees warrants to purchase up
to an aggregate of 1,081,917 shares of common stock, which represents 7.0% of the aggregate number of shares sold in the transaction.
The placement agent warrants have substantially the same terms as the investor warrants, except that the exercise price of the
placement agent warrants is $1.6175 per share. The placement agent warrants and the shares issuable upon exercise of the placement
agent warrants are being issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act
as transactions not involving a public offering and in reliance on similar exemptions under applicable state laws. We also paid
Wainwright for non-accountable expenses of $85,000. The engagement letter has indemnity and other customary provisions for transactions
of this nature.
The
forms of the securities purchase agreement, the investor warrant, the placement agent warrant, the registration rights agreement
and the engagement letter are filed as Exhibits 10.1, 4.1, 4.2, 4.3 and 10.2, respectively, to this Current Report on Form 8-K.
The foregoing descriptions of the securities purchase agreement, the investor warrant, the placement agent warrant, the registration
rights agreement and the engagement letter are not complete and are qualified in their entirety by reference to Exhibits 10.1,
4.1, 4.2, 4.3 and 10.2, respectively.