Item 8.01 Other Events
On March 10, 2020, InVivo Therapeutics Holdings Corp. (the "Company") completed a registered public offering (the "Offering") in which it sold an
aggregate of (i) 955,613 shares of common stock, $0.00001 par value per share, of the Company (the "Shares"), (ii) Series B warrants (the "Series B Warrants") exercisable
for an aggregate of 1,589,842 shares of common stock and (iii) Series A Warrants (the "Series A Warrants") exercisable for an aggregate of 2,545,455 shares of common stock (the
Series A Warrants together with the Series B Warrants, the "Warrants") pursuant to a Placement Agency Agreement (the "Placement Agency Agreement") the Company entered into with H.C.
Wainwright & Co., LLC ("Wainwright") on March 6, 2020.
The
Company's net proceeds from the Offering, after deducting Wainwright's placement agent fees and other estimated offering expenses payable by the Company, were approximately $6.1 million.
In
connection with the Offering, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") on March 6, 2020 with an institutional investor. The Purchase Agreement
contains customary representations and warranties of the Company, termination rights of the parties, and certain indemnification obligations of the Company and ongoing covenants of the Company,
including a prohibition on issuance of common stock or securities convertible or exchangeable into common stock by the Company for a period of 90 days after the date of the Purchase Agreement
and a
prohibition on the Company entering into variable rate transactions for a period of 12 months after the date of the Purchase Agreement, subject to certain exceptions.
The
Series A Warrants are immediately exercisable at a price of $2.75 per share of common stock, subject to adjustment in certain circumstances, and expire on March 10, 2025. The
Series B Warrants are immediately exercisable at a price of $0.00001 per share of common stock, subject to adjustment in certain circumstances, and expire when exercised in full, subject to
certain conditions. The Shares and Series B Warrants were each offered together with the Series A Warrants, but the Shares and Warrants were issued separately from the Series A
Warrants.
The
offering price to the public was $2.75 per Share and Series A Warrant and $2.74999 per Series B Warrant and Series A Warrant. The Series B Warrants were issued and sold
to certain purchasers whose purchase of shares of common stock in the Offering would have otherwise resulted in the purchaser, together with its affiliates and certain related parties, beneficially
owning more than 4.99% (or, at the election of the purchaser, 9.99%) of the Company's outstanding common stock immediately following the consummation of this Offering, if the purchaser so chose in
lieu of shares of common stock that would otherwise result in the purchaser's beneficial ownership exceeding 4.99% of the Company's outstanding common stock (or at the election of the purchaser,
9.99%).
The
Shares, Warrants and Placement Agent Warrants (as defined below) were issued pursuant to a registration statement on Form S-1 that was filed with the Securities and Exchange Commission
("SEC") on February 21, 2020 and declared effective by the SEC on March 6, 2020 (File No. 333-236572).
The
Company is also party to an engagement letter (the "Engagement Letter") with Wainwright, pursuant to which Wainwright acted as exclusive placement agent for the Offering. In accordance with the
terms of the Engagement Letter and the Placement Agency Agreement, the Company paid Wainwright a cash fee of $525,000, which represents 7.5% of the gross proceeds of the Offering, a management fee of
$70,000, which represents 1.0% of the gross proceeds of the Offering, and $25,000 for non-accountable expenses, as well as reimbursed Wainwright for its reasonable and documented out-of-pocket
expenses incurred in connection with the Offering, including its legal expenses, subject to a limit of $100,000 in the case of its legal expenses.
Pursuant
to the Engagement Letter and the Placement Agency Agreement, the Company issued to Wainwright's designees placement agent warrants (the "Placement Agent Warrants") to purchase 165,455 shares
of common stock, which represents a number of shares of common stock equal to 6.5% of the aggregate number of shares of common stock and Series B Warrants sold in the Offering. The Placement
Agent Warrants have an exercise price of $3.43 per share of common stock. The Placement Agent Warrants are immediately exercisable and expire March 6, 2025.
In
addition, under the Engagement Letter the Company has granted to Wainwright, subject to certain conditions, a 12-month right of first refusal to act as the Company's exclusive agent, advisor or
underwriter with respect to specified strategic transactions or financings that the Company may engage in. In addition, if any investor introduced to the Company by Wainwright participates in a
Company financing or capital raising transaction during the 12 months following closing of any offering in which Wainwright acts as the Company's exclusive agent, advisory or underwriter
pursuant to the Engagement Letter, the Company will
be
obligated to pay to Wainwright the cash and warrant compensation described above in connection with capital provided by such investor.
The
descriptions of terms and conditions of the Series A Warrants, the Series B Warrants, the Placement Agent Warrants and the Purchase Agreement set forth herein are qualified in their
entirety by the full text of the Form of Series A Warrant, Form of Series B Warrant, Form of Placement Agent Warrant and Form of Securities Purchase Agreement, which are filed as
Exhibits 4.1, 4.2, 4.3 and 99.1, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.