Filed Pursuant to Rule 424(b)(5)
Registration No. 333-219434
Prospectus Supplement
(to Prospectus dated August 11, 2017)
9,375,000 Units, Each Consisting of One
Share of Common Stock
and 0.5 of a Warrant to Purchase One
Share of Common Stock
We are offering up to 9,375,000 units (each a “Unit”)
at a purchase price of $1.60 per Unit. Each Unit consists of one share of our common stock and 0.5 of a warrant to purchase one
share of our common stock at an exercise price of $1.75 per share (each a “Warrant”). Each Warrant will be exercisable
immediately and will expire five years from the date of issuance.
The shares of common stock and the Warrants included in the
Units can only be purchased together in this offering, but the securities contained in the Units will be issued separately and
will be immediately separable upon issuance.
We are also offering the shares of common
stock that are issuable from time to time upon exercise of the Warrants being offered by this prospectus.
Our common stock is listed on The Nasdaq
Capital Market, or Nasdaq, under the symbol “MBRX.” On April 22, 2019, the last reported sale price of our common stock
on Nasdaq was $2.98 per share. There is no established public trading
market for the Warrants, and we do not expect a market to develop. We do not intend to apply for listing of the Warrants on any
securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the Warrants
will be limited.
We are an “emerging growth company”
under the federal securities laws and are subject to reduced public company reporting requirements for this prospectus and future
filings.
Investing in our securities involves a high degree of risk.
See “Risk Factors” beginning on page S-6 of this prospectus supplement and the risk factors incorporated by reference
into this prospectus supplement and the accompanying prospectus.
We are selling the Units directly to the
investors. We have retained Oppenheimer & Co. Inc. to act as our sole placement agent in connection with this offering. The
placement agent may engage one or more sub-placement agents or selected dealers to assist with this offering. The placement agent
is not purchasing the securities offered by us and is not required to sell any specific number or dollar amount of securities but
has agreed to use its reasonable best efforts to solicit offers to purchase the Units. There are no arrangements to place the funds
raised in this offering in an escrow, trust or similar account. We have agreed to pay the placement agent a fee of 6% of the aggregate
gross proceeds in this offering. We have also agreed to issue to the placement agent warrants to purchase up to 562,500 shares
of our common stock, which equates to 6.0% of the number of shares of our common stock to be issued and sold in this offering,
and to reimburse the placement agent for certain expenses. See “Plan of Distribution” beginning on page S-11 of this
prospectus supplement for more information regarding these arrangements.
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Per Unit
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Total
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Public offering price
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$
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1.60
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$
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15,000,000
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Placement agent fees
(1)
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$
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0.096
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$
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900,000
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Proceeds, before expenses, to us
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$
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1.504
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$
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14,100,000
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(1)
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The placement agent will
receive compensation in addition to the cash commission set forth above. See “Plan of Distribution” beginning on page
S-11 of this prospectus supplement for more information regarding the compensation payable to the placement agent.
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Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy
of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
Delivery of the securities offered hereby
is expected to be made on or about April 25, 2019, subject to the satisfaction of certain conditions.
Oppenheimer & Co.
The date of this prospectus supplement is
April 23, 2019
TABLE OF CONTENTS
About This Prospectus Supplement
This prospectus supplement and the accompanying
prospectus are part of a registration statement that we filed with the Securities and Exchange Commission (the “SEC”)
utilizing a “shelf” registration process. Each time we conduct an offering to sell securities under the accompanying
prospectus we will provide a prospectus supplement that will contain specific information about the terms of that offering, including
the price, the amount of securities being offered and the plan of distribution. The shelf registration statement was initially
filed with the SEC on July 24, 2017, and was declared effective by the SEC on August 21, 2017. This prospectus supplement describes
the specific details regarding this offering and may add, update or change information contained in the accompanying prospectus.
The accompanying prospectus provides general information about us and our securities, some of which, such as the section entitled
“Plan of Distribution,” may not apply to this offering. This prospectus supplement and the accompanying prospectus
are an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to
do so. We are not making offers to sell or solicitations to buy our common stock in any jurisdiction in which an offer or solicitation
is not authorized or in which the person making that offer or solicitation is not qualified to do so or to anyone to whom it is
unlawful to make an offer or solicitation.
If information in this prospectus supplement
is inconsistent with the accompanying prospectus or the information incorporated by reference with an earlier date, you should
rely on this prospectus supplement. This prospectus supplement, together with the base prospectus, the documents incorporated by
reference into this prospectus supplement and the accompanying prospectus and any free writing prospectus we have authorized for
use in connection with this offering include all material information relating to this offering. We have not, and the placement
agent has not, authorized anyone to provide you with different or additional information and you must not rely on any unauthorized
information or representations. You should assume that the information appearing in this prospectus supplement, the accompanying
prospectus, the documents incorporated by reference in this prospectus supplement and the accompanying prospectus and any free
writing prospectus we have authorized for use in connection with this offering is accurate only as of the respective dates of those
documents. Our business, financial condition, results of operations and prospects may have changed since those dates. You should
carefully read this prospectus supplement, the accompanying prospectus and the information and documents incorporated herein by
reference herein and therein, as well as any free writing prospectus we have authorized for use in connection with this offering,
before making an investment decision. See “Incorporation by Reference” and “Where You Can Find More Information”
in this prospectus supplement and in the accompanying prospectus.
No action is being taken in any jurisdiction
outside the United States to permit a public offering of these securities or possession or distribution of this prospectus supplement
or the accompanying prospectus in that jurisdiction. Persons who come into possession of this prospectus supplement and the accompanying
prospectus in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions as
to this offering and the distribution of this prospectus supplement and the accompanying prospectus applicable to that jurisdiction.
This prospectus supplement and the accompanying
prospectus contain summaries of certain provisions contained in some of the documents described herein which are summaries only
and are not intended to be complete. Reference is made to the actual documents for complete information. All of the summaries are
qualified in their entirety by the full text of the actual documents, some of which have been filed or will be filed and incorporated
by reference herein. See “Where You Can Find More Information” in this prospectus supplement. We further note that
the representations, warranties and covenants made by us in any agreement that is filed as an exhibit to any document that is incorporated
by reference into 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.
This prospectus supplement and the accompanying
prospectus contain and incorporate by reference certain market data and industry statistics and forecasts that are based on Company-sponsored
studies, independent industry publications and other publicly available information. Although we believe these sources are reliable,
estimates as they relate to projections involve numerous assumptions, are subject to risks and uncertainties, and are subject to
change based on various factors, including those discussed under “Risk Factors” in this prospectus supplement and the
accompanying prospectus and under similar headings in the documents incorporated by reference herein and therein. Accordingly,
investors should not place undue reliance on this information.
Unless otherwise stated or the context
requires otherwise, all references in this prospectus supplement to the “Company,” “we,” “us,”
“our”, “MBI” and “Moleculin” refer to Moleculin Biotech, Inc., a Delaware corporation, and
its wholly-owned subsidiary.
Prospectus Supplement Summary
This summary highlights information contained elsewhere in
this prospectus supplement, the accompanying prospectus and the documents incorporated by reference herein and therein. This summary
does not contain all of the information that you should consider before deciding to invest in our securities. You should read this
entire prospectus supplement and the accompanying prospectus carefully, including the section entitled “Risk Factors”
beginning on page S-6 and our consolidated financial statements and the related notes and the other information incorporated by
reference into this prospectus supplement and the accompanying prospectus, before making an investment decision.
Our Company
We are a clinical stage pharmaceutical
company focused on the treatment of highly resistant cancers. We have three core technologies, all of which are based on discoveries
made at M.D. Anderson Cancer Center, or MD Anderson. We have three drugs in four clinical trials in the US and Poland. Our clinical
stage drugs are Annamycin, believed by management to be a “Next Generation” Anthracycline, being studied for the treatment
of relapsed or refractory acute myeloid leukemia, or AML, and WP1066, an Immune/Transcription Modulator targeting brain tumors,
pancreatic cancer and AML. Additionally, a third drug, WP1220 (a molecule similar to WP1066), was approved for a clinical trial
in January 2019 in Poland for the topical treatment of cutaneous T-cell lymphoma. We are also engaged in preclinical development
of additional drug candidates, including additional Immune/Transcription Modulators, as well as Metabolism/Glycosylation Inhibitors.
We believe that our Next Generation Anthracycline,
Annamycin, is unlike any currently approved anthracyclines, as it is designed to avoid multidrug resistance mechanisms with little
to no cardiotoxicity – hence the use of the term “Next Generation.” Annamycin has preliminary clinical data suggesting
its potential to become the first successful therapy suitable for the majority of relapsed or refractory AML patients and is currently
in two Phase I/II clinical trials.
WP1066 is one of several Immune/Transcription
Modulators designed to stimulate the immune response to tumors by inhibiting the errant activity of Regulatory T-Cells (TRegs)
while also inhibiting key oncogenic transcription factors, including p-STAT3, c-Myc and HIF-1α. These transcription factors
are widely sought targets that may also play a role in the inability of immune checkpoint inhibitors to affect more resistant tumors.
We are also developing new compounds designed
to exploit the potential uses of inhibitors of glycolysis such as 2-deoxy-D-glucose, or 2-DG, which we believe may provide an opportunity
to cut off the fuel supply of tumors by taking advantage of their high level of dependence on glucose in comparison to healthy
cells. A key drawback to 2-DG is its lack of drug-like properties, including a short circulation time and poor tissue/organ distribution
characteristics. Our lead Metabolism/Glycosylation Inhibitor, WP1122, is a prodrug of 2-DG that appears to improve the drug-like
properties of 2-DG by increasing its circulation time and improving tissue/organ distribution. New research also points to the
potential for 2-DG to be capable of enhancing the usefulness of checkpoint inhibitors. Considering that 2-DG lacks sufficient drug-like
properties to be practical in a clinical setting, we believe WP1122 may also become an important drug to potentiate checkpoint
inhibitors.
Our principal executive office is located
at 5300 Memorial Drive, Suite 950, Houston, Texas 77007. Our website address is www.moleculin.com. Information contained in, or
accessible through, our website does not constitute part of this prospectus supplement and inclusions of our website address in
this prospectus supplement are inactive textual references only.
Recent Developments
On March 19, 2019, we announced that the
first two patients had been enrolled in our European clinical trial of WP1220 for the topical treatment of cutaneous T-cell lymphoma
(“CTCL”). The trial is targeting CTCL with a topical p-STAT3 inhibitor. We expect preliminary data with respect to
the trial to be available during 2019.
On March 26, 2019, we announced positive
interim safety and efficacy data from two ongoing open label, single arm Phase 1/2 studies of Annamycin. In the first study, being
conducted in the United States, four patients had completed treatment at 100 mg/m2 with no significant adverse events related to
Annamycin, and the study would proceed to the next higher dose of 120 mg/m2. The second trial, taking place in Poland, started
at a 120 mg/m2 dose of Annamycin and had treated three patients. The first patient treated in that trial received a single course
of Annamycin and his bone marrow blasts reduced from 60% to 11%. One patient had experienced grade 2 mucositis (which resolved
to grade 1 within 2 days) and no other adverse events related to Annamycin had been reported. Trial results for the other two patients
treated in Poland will not be known until the second quarter of this year.
On March 29, 2019 we consummated an underwritten
offering (the “March 2019 Offering) of 5,250,000 units, consisting of an aggregate of 5,250,000 shares of our common stock
and warrants to purchase up to 2,625,000 shares of our common stock at a public offering price of $1.00 per unit for estimated
net proceeds of $4.65 million. The warrants issued in the March 2019 Offering have an exercise price of $1.10 per share (subject
to adjustment in certain circumstances), are immediately exercisable and will expire five years from the date of issuance.
On April 11, 2019, we announced we had
entered into an agreement with Emory University to conduct a Phase 1 clinical trial of WP1066 in children with recurrent or refractory
malignant brain tumors. The study will be conducted at the Aflac Cancer & Blood Disorders Center at Children's Healthcare of
Atlanta.
On April 17, 2019, we announced that our
ongoing sponsored research at The University of Texas MD Anderson Cancer Center had demonstrated that Annamycin is able to significantly
improve survival in an aggressive form of triple negative breast cancer metastasized to the lungs in animal models.
On April 18, 2019, we announced that the
U.S. Food and Drug Administration (“FDA”) had granted our request for Fast Track Designation for Annamycin for the
treatment of relapsed or refractory acute myeloid leukemia.
Implications of Being an Emerging Growth
Company
We are an “emerging growth company,”
as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, enacted in April 2012, and we may remain an emerging company
for up to five years from the closing of our IPO in May 2016. For so long as we remain an emerging growth company, we are permitted
and intend to rely on certain exemptions from various public company reporting requirements, including not being required to have
our internal control over financial reporting audited by our independent registered public accounting firm pursuant to Section
404(b) of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports
and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and
any golden parachute payments not previously approved.
The Offering
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Securities offered by us
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Up to 9,375,000 Units. Each Unit consists of one share of our common stock and 0.5 of a Warrant to purchase one share of our common stock. Each Warrant included in the Units will have an exercise price of $1.75 per share, will be immediately exercisable and will expire five years from the date of issuance. This prospectus supplement also relates to the offering of the shares of our common stock issuable upon exercise of the Warrants.
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Common stock to be outstanding after this offering
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43,759,030 assuming the sale of all of the Units offered hereby and assuming no exercise of the Warrants
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Use of Proceeds
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We expect to use the net proceeds of this offering for our planned clinical trials, preclinical programs, for other research and development activities and for general corporate purposes. See “Use of Proceeds” on page S-8 prospectus supplement for a more complete description of the intended use of proceeds from this offering.
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Risk Factors
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Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page S-6 of this prospectus supplement and the risk factors incorporated by reference into this prospectus supplement and the accompanying prospectus.
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Nasdaq Capital Market Symbol
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MBRX. There is no established public trading market for the Warrants, and we do not expect a market to develop. We do not intend to apply for listing of the Warrants on any securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the Warrants will be limited.
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The number of shares of common stock expected to be outstanding
after this offering is based on 34,384,030 shares of common stock outstanding as of April 22, 2019 and excludes, as of that date,
the following:
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2,794,000 shares of common stock issuable upon the exercise of outstanding stock options, vested and unvested, with a weighted-average
exercise price of $2.61 per share;
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410,020 shares of common stock issuable upon the exercise of outstanding Series A, vested Series C and underwriter warrants
from our February 14, 2017 follow-on offering with a weighted-average exercise price of $1.50 per share;
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250,000 shares of common stock issuable upon the exercise of outstanding warrants under a consulting agreement with a weighted
average price of $2.76;
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107,802 shares of common stock issuable upon the exercise of outstanding underwriter warrants issued on May 1, 2016 related
to our IPO with an exercise price of $7.50 per share;
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up to an aggregate of 1,706,000 shares of common stock reserved for future issuance under our 2015 Stock Plan, as amended;
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2,273,700 shares of our common stock issuable upon the exercise of the warrants issued in our February 2018 private placement;
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710,212 shares of our common stock issuable upon the exercise of the warrants issued in our June 2018 private placement;
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up to 32,779 shares of common stock issuable upon the exercise of the warrants issuable to the placement agent in our June
2018 offering;
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2,625,000 shares of common stock issuable upon the exercise of the warrants issued in the March 2019 Offering;
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367,500 shares of common stock issuable upon the exercise of the warrants issuable to the representative of the underwriters
in the March 2019 Offering;
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4,687,500 shares of our common stock issuable upon the exercise of the warrants included in the Units; and
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562,500 shares of common stock issuable upon the exercise of the warrants issuable to the placement agent
in this offering.
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Risk Factors
An investment in our securities involves
risks. We urge you to consider carefully the risks described below, and in the documents incorporated by reference in this prospectus
supplement and the accompanying prospectus, before making an investment decision, including those risks identified under “Item
IA. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2018, which is incorporated by reference
in this prospectus supplement and which may be amended, supplemented or superseded from time to time by other reports that we subsequently
file with the SEC. If any of these risks actually occurs, our business, financial condition, results of operations or cash flow
could be seriously harmed. This could cause the trading price of our common stock to decline, resulting in a loss of all or part
of your investment. Please also read carefully the section below entitled “Cautionary Note Regarding Forward-Looking Statements”.
Risks Related to this Offering
You will experience immediate and substantial
dilution in the book value per share of the common stock you purchase in the offering.
Because the public offering price Unit
being offered is substantially higher than the net tangible book value per share of our outstanding common stock, you will suffer
immediate and substantial dilution in the net tangible book value of the common stock included in the Unit you purchase in this
offering. Investors purchasing Units in this offering will incur immediate dilution of $1.10 per share, after giving effect to
the sale of an aggregate of 9,375,000 Units at the public offering price set forth on the cover page of this prospectus supplement,
assuming no exercise of the Warrants included in the Units, no value is attributed to the Warrants and such Warrants are classified
and accounted for as equity, after deducting the underwriting discount and estimated offering expenses payable by us. See “Dilution”
on page S-9 of this prospectus supplement for a more detailed discussion of the dilution you will incur if you purchase Units in
this offering.
In addition, we may choose to raise additional
capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future
operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the
issuance of these securities could result in further dilution to our stockholders or result in downward pressure on the price of
our common stock
Our management will have broad discretion
over the use of the net proceeds from this offering, you may not agree with how we use the proceeds, and the proceeds may not be
invested successfully.
Our management will have broad discretion
in the application of the net proceeds from this offering, and our stockholders will not have the opportunity as part of their
investment decision to assess whether the net proceeds are being used appropriately. Because of the number and variability of factors
that will determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently
intended use. The failure by our management to apply these funds effectively could harm our business. See “Use of Proceeds”
on page S-8 of this prospectus supplement for a description of our proposed use of proceeds from this offering.
We will require additional capital funding,
the receipt of which may impair the value of our common stock.
Our future capital requirements depend
on many factors, including our research, development, sales and marketing activities. We will need to raise additional capital
through public or private equity or debt offerings or through arrangements with strategic partners or other sources in order to
continue to develop our drug candidates. There can be no assurance that additional capital will be available when needed or on
terms satisfactory to us, if at all. To the extent we raise additional capital by issuing equity securities, our stockholders may
experience substantial dilution and the new equity securities may have greater rights, preferences or privileges than our existing
common stock.
Our independent registered public accounting
firm has indicated that our recurring losses from operations raise substantial doubt about our ability to continue as a going concern.
As described in their audit report, our
auditors have included an explanatory paragraph that states that we had an accumulated deficit of $26.4 million at December 31,
2018 and have not generated any revenue from operations. These conditions raise substantial doubt about our ability to continue
as a going concern. Our consolidated financial statements do not include any adjustments that might result from the outcome of
this uncertainty. If we cannot continue as a viable entity, our securityholders may lose some or all of their investment in our
company.
We do not intend to pay dividends in
the foreseeable future.
We have never paid cash dividends on our
common stock and currently do not plan to pay any cash dividends in the foreseeable future.
There is no public market for the Warrants
being offered by us in this offering.
There is no established public trading
market for the Warrants 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, including the
Nasdaq Capital Market. Without an active market, the liquidity of the Warrants will be limited.
Holders of Warrants purchased in this
offering will have no rights as common stockholders until such holders exercise their Warrants and acquire our common stock.
Until holders of Warrants acquire shares
of our common stock upon exercise thereof, such holders will have no rights with respect to the shares of our common stock underlying
the Warrants. Upon exercise of the 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.
The Warrants are speculative in nature.
The Warrants do not confer any rights of
common stock ownership on their holders, such as voting rights or the right to receive dividends, but rather merely represent the
right to acquire shares of common stock at a fixed price for a limited period of time. Specifically, commencing on the date of
issuance, holders of the Warrants may exercise their right to acquire the common stock and pay an exercise price of $1.75 per share,
subject to certain adjustments, prior to five years from the date of issuance, after which date any unexercised Warrants will expire
and have no further value. Moreover, following this offering, the market value of the Warrants, if any, is uncertain and there
can be no assurance that the market value of the Warrants will equal or exceed their imputed offering price. The Warrants will
not be listed or quoted for trading on any market or exchange. There can be no assurance that the market price of the common stock
will ever equal or exceed the exercise price of the Warrants, and consequently, it may not ever be profitable for holders of the
Warrants to exercise the Warrants.
Cautionary Note Regarding Forward-Looking
Statements
This prospectus supplement, the accompanying
prospectus and the documents we have filed with the SEC that are incorporated by reference herein and therein contain forward-looking
statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Forward-looking statements concern our current plans, intentions, beliefs, expectations and statements
of future economic performance. Statements containing terms such as “will,” “may,” “believe,”
“do not believe,” “plan,” “expect,” “intend,” “estimate,” “anticipate”
and other phrases of similar meaning are considered to be forward-looking statements.
Forward-looking statements include, but
are not limited to, statements about:
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our ability to obtain additional funding to develop our product candidates;
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the effects of future government shutdowns on our ability to raise financing;
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the need to obtain regulatory approval of our product candidates;
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the success of our clinical trials through all phases of clinical development;
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our ability to complete our clinical trials in a timely fashion and within our expected budget;
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compliance with obligations under intellectual property licenses with third parties;
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any delays in regulatory review and approval of product candidates in clinical development;
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our ability to commercialize our product candidates;
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market acceptance of our product candidates;
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competition from existing products or new products that may emerge;
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potential product liability claims;
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our dependency on third-party manufacturers to supply or manufacture our product candidates;
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our ability to establish or maintain collaborations, licensing or other arrangements;
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the ability of our sublicense partners to successfully develop our product candidates in accordance
with our sublicense agreements;
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our ability and third parties’ abilities to protect intellectual property rights;
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our ability to adequately support future growth; and
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our ability to attract and retain key personnel to manage our business effectively.
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Forward-looking statements are based on
our assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially
from those reflected in or implied by these forward-looking statements. Factors that might cause actual results to differ include,
among others, those set forth under “Risk Factors” in this prospectus supplement and those discussed in “Management’s
Discussion and Analysis of Financial Condition and Results of Operation” in our most recent Annual Report on Form 10-K and
in our future reports filed with the SEC, all of which are incorporated by reference herein. Readers are cautioned not to place
undue reliance on any forward-looking statements contained in this prospectus supplement, the accompanying prospectus or the documents
we have filed with the SEC that are incorporated by reference herein and therein, which reflect management’s views and opinions
only as of their respective dates. We assume no obligation to update forward-looking statements to reflect actual results, changes
in assumptions or changes in other factors affecting such forward-looking statements, except to the extent required by applicable
securities laws.
You should carefully read this prospectus
supplement, the accompanying prospectus and the information incorporated herein by reference as described under the heading “Incorporation
of Documents by Reference,” and the documents that we reference in this prospectus supplement and the accompanying prospectus
and have filed as exhibits to the registration statement of which this prospectus supplement and the accompanying prospectus are
a part with the understanding that our actual future results, levels of activity, performance and achievements may be materially
different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
Use of Proceeds
We estimate that the net proceeds from
this offering will be approximately $14.0 million, after deducting the estimated placement agent fees and estimated offering expenses
payable by us, assuming all of the Units offered hereby are sold. This estimate excludes the proceeds, if any, from exercise of
the Warrants sold in this offering. If all of the Warrants sold in this offering were to be exercised in cash at an exercise price
of $1.75 per share, we would receive additional proceeds of approximately $8.2 million. We cannot predict when or if these Warrants
will be exercised. It is possible that these Warrants may expire and may never be exercised.
We intend to use the net proceeds from
this offering for our planned clinical trials, preclinical programs, for other research and development activities and for general
corporate purposes. This represents our best estimate of the manner in which we will use the net proceeds we receive from this
offering based upon the current status of our business, but we have not reserved or allocated amounts for specific purposes and
we cannot specify with certainty how or when we will use any of the net proceeds. Amounts and timing of our actual expenditures
will depend on numerous factors. Our management will have broad discretion in applying the net proceeds from this offering.
Dividend Policy
We have never declared or paid any cash dividends on our capital
stock, and we do not currently intend to pay any cash dividends on our common stock for the foreseeable future. We expect to retain
future earnings, if any, to fund the development and growth of our business. Any future determination to pay dividends on our common
stock will be at the discretion of our board of directors and will depend upon, among other factors, our results of operations,
financial condition, capital requirements and any contractual restrictions.
Dilution
If you invest in our Units in this offering,
your interest will be diluted immediately to the extent of the difference between the public offering price per Unit and the pro
forma as adjusted net tangible book value per share of our common stock immediately after this offering.
Our net tangible book value as of December
31, 2018 was approximately $3.1 million, or approximately $0.11 per share. Net tangible book value is determined by subtracting
our total liabilities from our total tangible assets, and net tangible book value per share is determined by dividing our net tangible
book value by the number of shares of our common stock outstanding. After giving effect to the March 2019 Offering, our pro forma
net tangible book value was approximately $7.8 million or approximately $0.23 per share. After giving further effect to the sale
of 9,375,000 Units in this offering at the public offering price of $1.60 per Unit, assuming no exercise of the Warrants included
in the Units, no value is attributed to such Warrants and such Warrants are classified and accounted for as equity, and after deducting
the placement agent fees and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of
December 31, 2018 would have been approximately $21.7 million, or approximately $0.50 per share. This represents an immediate increase
in pro forma net tangible book value of approximately $0.27 per share to our existing stockholders and an immediate dilution of
approximately $1.10 per share to new investors participating in this offering. The following table illustrates this dilution on
a per share basis:
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Public offering price per Unit
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|
$
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1.60
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|
Net tangible book value per share as of December 31, 2018
|
|
$
|
0.11
|
|
|
|
|
|
|
Increase in net tangible value per share attributable to the March 2019 Offering
|
|
$
|
0.12
|
|
|
|
|
|
|
Pro forma net tangible book value per share after March 2019 Offering
|
|
$
|
0.23
|
|
|
|
|
|
|
Increase in pro forma net tangible value per share attributable to this offering
|
|
$
|
0.27
|
|
|
|
|
|
|
Pro forma as adjusted net tangible book value per share after giving effect to this offering
|
|
|
|
|
|
$
|
0.50
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|
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Dilution per share to new investors participating in this offering
|
|
|
|
|
|
$
|
1.10
|
|
The number of shares of common stock to be outstanding after
this offering is based on 28,528,663 shares of common stock outstanding as of December 31, 2018, 33,778,663 shares on a pro forma
basis after giving effect to the March 2019 Offering, and excludes, as of that date, the following:
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|
•
|
2,794,000 shares of common stock issuable upon the exercise of outstanding stock options, vested and unvested, with a weighted-average
exercise price of $2.61 per share;
|
|
|
•
|
410,020 shares of common stock issuable upon the exercise of outstanding Series A, vested Series C and underwriter warrants
from our February 14, 2017 follow-on offering with a weighted-average exercise price of $1.50 per share;
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|
|
•
|
250,000 shares of common stock issuable upon the exercise of outstanding warrants under a consulting agreement with a weighted
average price of $2.76;
|
|
|
•
|
107,802 shares of common stock issuable upon the exercise of outstanding underwriter warrants issued on May 1, 2016 related
to our IPO with an exercise price of $7.50 per share;
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|
|
•
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up to an aggregate of 1,706,000 shares of common stock reserved for future issuance under our 2015 Stock Plan, as amended;
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|
|
•
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2,273,700 shares of our common stock issuable upon the exercise of the warrants issued in our February 2018 private placement;
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|
|
•
|
710,212 shares of our common stock issuable upon the exercise of the warrants issued in our June 2018 private placement;
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|
|
•
|
up to 32,779 shares of common stock issuable upon the exercise of the warrants issuable to the placement agent in our June
2018 offering;
|
|
|
•
|
2,625,000 shares of common stock issuable upon the exercise of the warrants issued in the March 2019 Offering;
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|
|
•
|
367,500 shares of common stock issuable upon the exercise of the warrants issuable to the representative of the underwriters
in the March 2019 Offering;
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|
|
•
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4,687,500 shares of our common stock issuable upon the exercise of the warrants included in the Units; and
|
|
|
•
|
562,500 shares of common stock issuable upon the exercise of the warrants issuable to the placement agent in this offering.
|
The above illustration of dilution per share to investors participating
in this offering assumes no exercise of outstanding options or warrants to purchase our common stock. The exercise of outstanding
options or warrants, having an exercise or conversion price less than the offering price would increase dilution to investors participating
in this offering. In addition, we may choose to raise additional capital depending on market conditions, our capital requirements
and strategic considerations, even if we believe we have sufficient funds for our current or future operating plans. To the extent
that additional capital is raised through our sale of equity or convertible debt securities, the issuance of these securities could
result in further dilution to our stockholders.
Description of the Securities We are
Offering
We are offering Units, each Unit consisting
of one share of our common stock and 0.5 of a Warrant to purchase one share of our common stock. The shares of common stock and
the Warrants included in the Units can only be purchased together in this offering, but the securities contained in the Units will
be issued separately and will be immediately separable upon issuance. We are also registering the shares of common stock included
in the Units and the shares of common stock issuable from time to time upon exercise of Warrants included in the Units offered
hereby.
Common Stock
The material terms and provisions of our
common stock are described under the caption “Description of Common Stock” starting on page 4 of the accompanying prospectus.
Warrants
The following summary of certain terms
and provisions of the Warrants is not complete and is subject to, and qualified in its entirety by, the provisions of the Warrants.
Prospective investors should carefully review the terms and provisions of the form of Warrant for a complete description of the
terms and conditions of the Warrants.
Duration and Exercise Price
Each Warrant included in the Units will
have an exercise price of $1.75 per share, will be immediately exercisable and will expire five years from the date of issuance.
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. The Warrants
will be issued separately from the common stock included in the Units. 0.5 of a Warrant to purchase one share of our common stock
will be included in each Unit purchased in this offering.
Cashless Exercise
If, at the time a holder exercises its
Warrants, a registration statement registering the issuance of the shares of common stock underlying the Warrants under the Securities
Act is not then effective or available for the issuance of such shares, then 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 will be permitted 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
Warrants.
Exercisability
The 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
above). A holder (together with its affiliates) may not exercise any portion of a Warrant to the extent that the holder would own
more than 4.99% of the outstanding common stock immediately after exercise, except that upon at least 61 days' prior notice from
the holder to us, the holder may increase the amount of ownership of outstanding stock after exercising the holder's Warrants up
to 9.99% of the number of shares of our common stock outstanding immediately after giving effect to the exercise, as such percentage
ownership is determined in accordance with the terms of the Warrants. Purchasers of Warrants in this offering may also elect prior
to the issuance of Warrants to have the initial exercise limitation set at 9.99% of our outstanding common stock.
Fractional Shares
No fractional shares of common stock will
be issued upon the exercise of the Warrants. Rather, the number of shares of common stock to be issued will be rounded to the nearest
whole number.
Transferability
Subject to applicable laws, a Warrant may
be transferred at the option of the holder upon surrender of the Warrant to us together with the appropriate instruments of transfer.
Exchange Listing
We do not intend to list the Warrants on
any securities exchange or nationally recognized trading system. The common stock issuable upon exercise of the Warrants is currently
listed on the Nasdaq Capital Market.
Right as a Stockholder
Except as otherwise provided in the Warrants
or by virtue of such holder’s ownership of shares of our common stock, the holders of the Warrants do not have the rights
or privileges of holders of our common stock, including any voting rights, until they exercise their Warrants.
Fundamental Transaction
In the event of a fundamental transaction,
as described in the Warrants and generally including any reorganization, recapitalization or reclassification of our common stock,
the sale, transfer or other disposition of all or substantially all of our properties or assets, our consolidation or merger with
or into another person, the acquisition of at least 50% of our outstanding common stock, or any person or group becoming the beneficial
owner of at least 50% of the voting power represented by our outstanding common stock, the holders of the Warrants will be entitled
to receive upon exercise of the Warrants the kind and amount of securities, cash or other property that the holders would have
received had they exercised the Warrants immediately prior to such fundamental transaction. In addition, in the event of a fundamental
transaction which is approved by our Board, the holders of the Warrants have the right to require us or a successor entity to redeem
the Warrants for cash in the amount of the Black-Scholes value of the unexercised portion of the Warrants on the date of the consummation
of the fundamental transaction. In the event of a fundamental transaction which is not approved by our Board, the holders of the
Warrants have the right to require us or a successor entity to redeem the Warrants for the consideration paid in the fundamental
transaction in the amount of the Black Scholes value of the unexercised portion of the Warrants on the date of the consummation
of the fundamental transaction payable at our option in either shares of our common stock (or, in certain cases, in the securities
of the successor entity) or cash.
Plan of Distribution
We have engaged Oppenheimer & Co. Inc.
to act as our sole placement agent pursuant to a placement agent agreement in connection with this offering, dated as of April
23, 2109 by and between Oppenheimer & Co. Inc. (the “Placement Agent”) and us, in connection with this offering.
The placement agent is not purchasing or selling any of the securities we are offering by this prospectus supplement but has agreed
to use its reasonable best efforts to arrange for the sale of the Units offered by this prospectus supplement. The placement agent
may retain sub-agents and selected dealers in connection with this offering.
We have entered into subscription agreements,
each dated April 23, 2019, directly with several investors who have agreed to purchase the Units in this offering. The subscription
agreements and the placement agent agreement provide that the obligations of the placement agent and the investors are subject
to certain conditions precedent, including, among other things, the absence of any material adverse change in our business and
the receipt of customary opinions and closing certificates.
We currently anticipate that the closing
of this offering will take place on or about April 25, 2019, subject to customary closing conditions. On the closing date, the
following will occur:
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●
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we will receive funds in the amount of the aggregate purchase price;
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●
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the placement agent will receive the placement agent fees in accordance with the terms of the placement agent agreement; and
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●
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we will deliver the shares of our common stock and Warrants to the investors.
|
We have agreed to pay the placement agent
a placement agent fee in cash equal to 6.0%, or $900,000, of the gross proceeds from the sale of the Units in this offering. The
following table shows the per Unit and total placement agent fees we will pay in connection with the sale of the Units offered
hereby, assuming the purchase of all of the Units we are offering.
|
|
Per unit placement agent fee
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|
$
|
0.096
|
|
|
|
Total placement agent fees payable by us
|
|
$
|
900,000
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|
In addition, we have agreed to reimburse
the placement agent at the closing for its legal fees and expenses in connection with this offering in the amount of $75,000. We
have also agreed to issue to the placement agent warrants to purchase up to 562,500 shares of our common stock, which equates
to 6.0% of the number of shares of our common stock to be issued and sold in this offering, at an exercise price of $1.75 per share.
The placement agent warrants have been deemed compensation by the Financial Industry Regulatory Authority, Inc. (“FINRA”)
and are therefore shall not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale,
derivative, put or call transaction that would result in the effective economic disposition of the securities by any person for
a period of 180 days immediately following the date of effectiveness or commencement of sales of the public offering, pursuant
to Rule 5110(g)(1) of FINRA’s Rules. We have also agreed, subject to certain conditions, to provide the placement agent with a right of first
refusal to act as sole book-running underwriter, sole-lead initial purchaser, sole-lead placement agent, or sole-lead selling agent,
as the case may be, on any financing for us on or before January 25, 2020.
We estimate the total expenses of this
offering (including the expenses reimbursable to the placement agent) payable by us, excluding the placement agent fee, will be
approximately $125,000.
We have agreed to indemnify the placement
agent and certain other persons against certain liabilities relating to or arising out of the placement agent’s activities
under the placement agency agreement. We have also agreed to contribute to payments the placement agent may be required to make
in respect of such liabilities.
The placement agent may be deemed to be
an underwriter within the meaning of Section 2(a)(11) of the Securities Act, and any commissions received by it and any profit
realized on the resale of the shares sold by it while acting as principal might be deemed to be underwriting discounts or commissions
under the Securities Act. As an underwriter, the placement agent would be required to comply with the requirements of the Securities
Act and the Exchange Act, including, without limitation, Rule 415(a)(4) under the Securities Act and Rule 10b-5 and Regulation
M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of shares of common stock by
the placement agent acting as principal. Under these rules and regulations, the placement agent:
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●
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must not engage in any stabilization activity in connection with our securities; and
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●
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must not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other than as permitted under the Exchange Act, until it has completed its participation in the distribution.
|
A copy of the form of the subscription
agreement we entered into with the investors will be included as an exhibit to our Current Report on Form 8-K that will be filed
with the Securities and Exchange Commission in connection with the consummation of this offering.
We and our executive officers and directors have agreed to a
90-day “lock-up” with respect to shares of our common stock and other securities beneficially owned, including securities
that are convertible into, or exchangeable or exercisable for, shares of our common stock. Subject to certain exceptions, during
such lock-up period following the date of this prospectus supplement, we and our executive officers and directors may not offer,
sell, pledge or otherwise dispose of these securities without the prior written consent of the placement agent.
The placement agent and its affiliates have provided in the
past and may provide from time to time in the future certain commercial banking, financial advisory, investment banking and other
services for us and our affiliates in the ordinary course of their business, for which they may receive customary fees and commissions.
In addition, from time to time, the placement agent and its affiliates may effect transactions for their own account or the accounts
of customers, and hold on behalf of itself or its customers, long or short positions in our debt or equity securities or loans,
and may do so in the future. The placement agent served as the representative of the several underwriters in connection with the
March 2019 Offering and received an underwriting discount of $321,370 and an expense reimbursement of $115,000 in connection therewith.
In addition, we issued to the placement agent five-year warrants to purchase up to 367,500 share of our common stock at an exercise
price of $1.10 per share. We also agreed, subject to certain conditions, to provide the placement agent. with a right of first
refusal to act as sole book-running underwriter, sole-lead initial purchaser, sole-lead placement agent, or sole-lead selling agent,
as the case may be, on any financing for us on or before September 29, 2019.
Roth Capital Partners, LLC and Maxim Group LLC acted as financial
advisors to us in connection with the offering and will receive customary financial advisory fees in connection therewith. Roth
Capital Partners, LLC and Maxim Group LLC are not engaged in, nor affiliated with any entity that is engaged in, the solicitation
or distribution of this offering.
Legal Matters
The validity of the securities offered hereby will be passed
upon for us by Schiff Hardin LLP, Washington, DC. Lowenstein Sandler LLP, New York, New York, is acting as counsel for the
placement
agent
in connection with this offering.
Experts
The audited financial statements incorporated by reference in
this prospectus and elsewhere in the registration statement have been incorporated by reference in reliance upon the reports of
Grant Thornton LLP, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing.
Incorporation by Reference
The SEC allows us to “incorporate by reference”
into this prospectus supplement the information in other documents that we file with it. This means that we can disclose important
information to you by referring you to those documents. The information incorporated by reference is considered to be a part of
this prospectus supplement, and information in documents that we file later with the SEC will automatically update and supersede
information contained in documents filed earlier with the SEC or contained in this prospectus supplement. We incorporate by reference
in this prospectus supplement the documents listed below and any future filings that we may make with the SEC under Sections 13(a),
13(c), 14, or 15(d) of the Exchange Act prior to the termination of the offering under this prospectus supplement; provided, however,
that we are not incorporating, in each case, any documents or information deemed to have been furnished and not filed in accordance
with SEC rules:
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·
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Our Annual Report on Form 10-K for the year ended December 31, 2018 (filed on February 21, 2019);
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·
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Our Current Reports on Form 8-K filed on February 5, 2019; February 7, 2019; March 14, 2019; March 28, 2019; and April 23,
2019;
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·
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Our Definitive Proxy Statement on Schedule 14A filed on April 16, 2019; and
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·
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the description of our common stock, par value $0.001 per share contained in our Registration Statement on Form 8-A, dated
and filed with the SEC on April 28, 2016, and any amendment or report filed with the SEC for the purpose of updating the description.
|
All reports and other documents we subsequently file pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering, including all such documents
we may file with the SEC after the date of this prospectus supplement and accompanying prospectus, but excluding any information
furnished to, rather than filed with, the SEC, will also be incorporated by reference into this prospectus supplement and deemed
to be part of this prospectus supplement from the date of the filing of such reports and documents.
You may obtain a copy of any or all of the documents referred
to above, which may have been or may be incorporated by reference into this prospectus supplement, including exhibits, at no cost
to you by writing or telephoning us at the following address: Attention: Corporate Secretary, 5300 Memorial Drive, Suite 950, Houston,
Texas 77007, telephone (713) 300-5160..
Where You Can Find More Information
This prospectus supplement and the accompanying prospectus are
part of a registration statement on Form S-3 we filed with the SEC under the Securities Act and do not contain all the information
set forth or incorporated by reference in the registration statement. Whenever a reference is made in this prospectus supplement
or the accompanying prospectus to any of our contracts, agreements or other documents, the reference may not be complete and you
should refer to the exhibits that are a part of the registration statement or the exhibits to the reports or other documents incorporated
by reference into this prospectus supplement or the accompanying prospectus for a copy of such contract, agreement or other document.
Because we are subject to the information and reporting requirements of the Exchange Act, we file annual, quarterly and current
reports, proxy statements and other information with the SEC. You may read and copy information filed by us with the SEC at the
SEC’s public reference section, 100 F Street, N.E., Washington, D.C. 20549. Information regarding the operation of the public
reference section can be obtained by calling 1-800-SEC-0330. The SEC also maintains an Internet site at http://www.sec.gov that
contains reports, statements and other information about issuers, such as us, who file electronically with the SEC.
PROSPECTUS
$75,000,000
Moleculin Biotech, Inc.
Common Stock
Preferred Stock
Debt Securities
Warrants
Units
We may from time to time
issue up to $75,000,000 aggregate dollar amount of common stock, preferred stock, debt securities, warrants or units of securities.
We will specify in the accompanying prospectus supplement the terms of the securities to be offered and sold. We may sell these
securities directly to you, through underwriters, dealers or agents we select, or through a combination of these methods. We will
describe the plan of distribution for any particular offering of these securities in the applicable prospectus supplement. This
prospectus may not be used to sell our securities unless it is accompanied by a prospectus supplement.
Our common stock is listed
on The NASDAQ Capital Market and traded under the symbol “MBRX”. On August 9, 2017, the closing price of the common
stock, as reported on NASDAQ was $2.87 per share.
As of August 1, 2017,
the aggregate market value of our outstanding common stock held by non-affiliates was approximately $35,633,714, based on 20,261,904
shares of outstanding common stock, of which approximately 13,148,972 shares are held by non-affiliates, and a per share price
of $2.71 based on the closing sales price of our common stock on August 1, 2017. As of the date hereof, we have not offered any
securities pursuant to General Instruction I.B.6 of Form S-3 during the prior 12 calendar month period that ends on and includes
the date hereof.
Investing in our securities
is highly speculative and involves a high degree of risk. You should purchase these securities only if you can afford a complete
loss of your investment. You should carefully consider the risks and uncertainties described under the heading “Risk Factors”
beginning on page 3 of this prospectus before making a decision to purchase our securities.
Neither the Securities
and Exchange Commission 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.
The date of this prospectus is August 21, 2017.
Table
of Contents
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the SEC, utilizing
a “shelf” registration process. Under this shelf registration process, we may sell the securities described in this
prospectus in one or more offerings up to a total dollar amount of $75,000,000.
We
have provided to you in this prospectus a general description of the securities we may offer. Each time we sell securities under
this shelf registration process, we will provide a prospectus supplement that will contain specific information about the terms
of that offering. That prospectus supplement may include additional risk factors or other special considerations applicable to
the securities being offered. We may also add, update or change in the prospectus supplement any of the information contained
in this prospectus. To the extent there is a conflict between the information contained in this prospectus and the prospectus
supplement, you should rely on the information in the prospectus supplement, provided that if a statement in any document is inconsistent
with a statement in another document having a later date — for example, a document incorporated by reference in this prospectus
or any prospectus supplement — the statement in the document having the later date modifies or supersedes the earlier statement.
You should read both this prospectus and the prospectus supplement together with the additional information described under “Where
You Can Find More Information.”
The
registration statement containing this prospectus, including the exhibits to the registration statement, provides additional information
about us and the securities offered under this prospectus. The registration statement, including the exhibits, can be read at
the SEC website or at the SEC offices mentioned under the heading “Where You Can Find More Information.”
You
should rely only on the information incorporated by reference or provided in this prospectus and the accompanying prospectus supplement.
We have not authorized anyone to provide you with different information. We are not making an offer to sell or soliciting an offer
to buy these securities in any jurisdiction in which the offer or solicitation is not authorized or in which the person making
the offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make the offer or solicitation. You
should not assume that the information in this prospectus or the accompanying prospectus supplement is accurate as of any date
other than the date on the front of the document.
Unless
the context requires otherwise, references to the “Company,” “MBI,” “we,” “our,”
and “us,” refer to Moleculin Biotech, Inc. and its subsidiaries.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities offered in
this offering. We file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange
Commission. You may read and copy the registration statement and any other documents we have filed at the Securities and Exchange
Commission’s Public Reference Room 100 F Street, N.E., Washington, D.C. 20549. Please call the Securities and Exchange Commission
at 1-800-SEC-0330 for further information on the Public Reference Room. Our Securities and Exchange Commission filings are also
available to the public at the Securities and Exchange Commission’s Internet site at www.sec.gov.
This
prospectus is part of the registration statement and does not contain all of the information included in the registration statement.
Whenever a reference is made in this prospectus to any of our contracts or other documents, the reference may not be complete
and, for a copy of the contract or document, you should refer to the exhibits that are a part of the registration statement.
INCORPORATION
BY REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus the information we file with it, which means that
we can disclose important information to you by referring you to those documents. Later information filed with the SEC will update
and supersede this information.
We
incorporate by reference the documents listed below, all filings filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of the initial registration statement of which this prospectus forms a part prior to effectiveness
of such registration statement, and any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act prior to the time that all securities covered by this prospectus have been sold or the offering is otherwise terminated; provided,
however, that we are not incorporating any information furnished under either Item 2.02 or Item 7.01 of any current
report on Form 8-K:
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•
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Our
Annual Report on Form 10-K for the year ended December 31, 2016 filed on April
3, 2017.
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•
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Our
Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2017 and
June 30, 2017.
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•
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Our
Definitive Proxy Statement on Schedule 14A filed on April 28, 2017.
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•
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Our
Current Reports on Form 8-K dated February 9, 2017; February 23, 2017; March 14,
2017; March 22, 2017; April 17, 2017; May 19, 2017; May 31, 2017; June 27, 2017; June
30, 2017; July 12, 2017; and July 27, 2017.
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•
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The
description of our common stock contained in our registration statement on Form 8-A
filed on April 28, 2016, and any amendment or report filed for the purpose of updating
that description.
|
An
updated description of our capital stock is included in this prospectus under “Description of Common Stock” and “Description
of Preferred Stock”.
We
will provide to each person, including any beneficial owner, to whom this prospectus is delivered, upon written or oral request,
at no cost to the requester, a copy of any and all of the information that is incorporated by reference in this prospectus. You
may request a copy of these filings, at no cost, by contacting us at:
Moleculin Biotech, Inc.
Attn: Corporate Secretary
2575 West Bellfort, Suite
333
Houston, TX 77054
Phone: 713-300-5160
ABOUT
MOLECULIN BIOTECH, INC.
Our Company
We are a preclinical-stage
pharmaceutical company organized as a Delaware corporation in July 2015 to focus on the development of anti-cancer drug candidates,
some of which are based on license agreements with The University of Texas System on behalf of the M.D. Anderson Cancer Center,
which we refer to as MD Anderson. Our lead drug candidate is liposomal Annamycin, which we refer to as Annamycin, an anthracycline
being studied for the treatment of relapsed or refractory acute myeloid leukemia, or AML. We have two other drug development projects
in process, one involving a collection of small molecules, which we refer to as the WP1066 Portfolio, focused on the modulation
of key regulatory transcription factors involved in the progression of cancer, and the WP1222 Portfolio, a suite of molecules
targeting the metabolic processes involved in cancer in general and glioblastoma (the most common form of brain tumor) in particular.
We also continue to sponsor ongoing research at MD Anderson in order to improve and expand our drug development pipeline.
We have been granted royalty-bearing,
worldwide, exclusive licenses for the patent and technology rights related to our WP1066 Portfolio and WP1122 Portfolio drug technologies,
as these patent rights are owned by MD Anderson. The Annamycin drug substance is no longer covered by any existing patent protection.
We intend to submit patent applications for formulation, synthetic process and reconstitution related to our Annamycin drug product
candidate, although there is no assurance that we will be successful in obtaining such patent protection. Independently from potential
patent protection, we have received Orphan Drug designation from the FDA for Annamycin for the treatment of AML, which would entitle
us to market exclusivity of 7 years from the date of approval of a New Drug Application (NDA) in the United States. If we submit
and receive approval for a New Drug Application (NDA) for Annamycin for the treatment of AML, we may then benefit from Orphan
Drug exclusivity, during which period FDA generally could not approve another Annamycin product for the same use. We also intend
to apply for similar status in the European Union (EU) where market exclusivity extends to 10 years from the date of Marketing
Authorization Application (MAA). Separately, the FDA may also grant market exclusivity of 5 years for newly approved new chemical
entities (of which Annamycin would be one), but there can be no assurance that such exclusivity will be granted.
Corporate Information
Our
corporate headquarters is located at 2575 West Bellfort, Suite 333, Houston, TX 77054. Our phone number is (713) 300-5160.
Our corporate website is www.moleculin.com. Information contained on our website or any other website does not constitute part
of this prospectus.
RISK FACTORS
Before making an investment
decision, you should consider the “Risk Factors” included under Item 1A. of our Annual Report on Form 10-K for the
period ended December 31, 2016 and in our updates to those Risk Factors in our Quarterly Reports on Form 10-Q, all of which are
incorporated by reference in this prospectus, as updated by our future filings with the SEC. The market or trading price of our
common stock could decline due to any of these risks. In addition, please read “Forward-Looking Statements” in this
prospectus, where we describe additional uncertainties associated with our business and the forward-looking statements included
or incorporated by reference in this prospectus. Please note that additional risks not currently known to us or that we currently
deem immaterial may also impair our business and operations. The accompanying prospectus supplement may contain a discussion of
additional risks applicable to an investment in us and the particular type of securities we are offering under that prospectus
supplement.
Forward-Looking
Statements
Some of the information
in this prospectus, and the documents we incorporate by reference, contain forward-looking statements within the meaning of the
federal securities laws. You should not rely on forward-looking statements in this prospectus, and the documents we incorporate
by reference. Forward-looking statements typically are identified by use of terms such as “anticipate,” “believe,”
“plan,” “expect,” “future,” “intend,” “may,” “will,” “should,”
“estimate,” “predict,” “potential,” “continue,” and similar words, although some
forward-looking statements are expressed differently. This prospectus, and the documents we incorporate by reference, may also
contain forward-looking statements attributed to third parties relating to their estimates regarding the markets we may enter
in the future. All forward-looking statements address matters that involve risk and uncertainties, and there are many important
risks, uncertainties and other factors that could cause our actual results to differ materially from the forward-looking statements
contained in this prospectus, and the documents we incorporate by reference.
You should also consider
carefully the statements under “Risk Factors” and other sections of this prospectus, and the documents we incorporate
by reference, which address additional facts that could cause our actual results to differ from those set forth in the forward-looking
statements. We caution investors not to place significant reliance on the forward-looking statements contained in this prospectus,
and the documents we incorporate by reference. We undertake no obligation to publicly update or review any forward-looking statements,
whether as a result of new information, future developments or otherwise.
USE OF PROCEEDS
We expect to use the net
proceeds from the sale of securities offered by this prospectus and the prospectus supplement for our clinical trials, if any,
and preclinical programs, for other research and development activities and for general corporate purposes. These may include
additions to working capital, repayment of existing indebtedness and acquisitions. If we decide to use the net proceeds of any
offering of securities other than for our clinical trials, if any, and preclinical programs, for other research and development
activities and for general corporate purposes, we will describe the use of the net proceeds in the prospectus supplement for that
offering.
DESCRIPTION OF COMMON
STOCK
General
We are currently authorized
to issue 75,000,000 shares of common stock, par value $0.001. As of August 1, 2017, we had 20,261,904 shares of our common stock
outstanding.
Subject to preferences
that may be applicable to any preferred stock outstanding at the time, the holders of our common stock are entitled to receive
dividends out of legally available assets at such times and in such amounts as our Board of Directors may from time to time determine.
Each stockholder is entitled to one vote for each share of common stock held on all matters submitted to a vote of stockholders.
Cumulative voting is not allowed.
Our common stock is not
subject to conversion or redemption and holders of our common stock are not entitled to preemptive rights. Upon the liquidation,
dissolution or winding up of our company, the remaining assets legally available for distribution to stockholders, after payment
of claims or creditors and payment of liquidation preferences, if any, on outstanding preferred stock, are distributable ratably
among the holders of our common stock and any participating preferred stock outstanding at that time. Each outstanding share of
common stock is fully paid and nonassessable.
Anti-Takeover Effects of Provisions of Delaware Law and our
Charter Documents
Provisions of Delaware
law and our Amended and Restated Certificate of Incorporation (“Certificate of Incorporation”) and our Amended and
Restated Bylaws (“Bylaws”) could make the acquisition of our company through a tender offer, a proxy contest or other
means more difficult and could make the removal of incumbent officers and directors more difficult. We expect these provisions
to discourage coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of
our company to first negotiate with our Board of Directors. We believe that the benefits provided by our ability to negotiate
with the proponent of an unfriendly or unsolicited proposal outweigh the disadvantages of discouraging these proposals. We believe
the negotiation of an unfriendly or unsolicited proposal could result in an improvement of its terms.
Our Bylaws do not permit
stockholders to call a special meeting of stockholders. Our Bylaws provide that special meetings of the stockholders may be called
by the Chairman of the Board of Directors, our Chief Executive Officer, our President, the Board of Directors, or in their absence
or disability, by any vice president. Our Bylaws require that all stockholder actions be taken by a vote of the stockholders at
an annual or special meeting, and do not permit our stockholders to act by written consent without a meeting. Our Bylaws provide
for an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders, including
proposed nominations of persons for election to the Board of Directors. At an annual meeting, stockholders may only consider proposals
or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the Board of Directors.
The Bylaws do not give our Board of Directors the power to approve or disapprove stockholder nominations of candidates or proposals
regarding other business to be conducted at a special or annual meeting of the stockholders. However, our Bylaws may have the
effect of precluding the conduct of business at a meeting if the proper procedures are not followed. These provisions may also
discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of
directors or otherwise attempting to obtain control of our company.
Quotation
Our common stock is listed
on The NASDAQ Capital Market and traded under the symbol “MBRX”.
Transfer Agent
The transfer agent for
our common stock is VStock Transfer, LLC located at 18 Lafayette Place, Woodmere, New York 11598.
DESCRIPTION OF PREFERRED
STOCK
General
We are currently authorized
to issue 5,000,000 shares of preferred stock, par value $0.001. As of the date of this prospectus, we have no shares of preferred
stock outstanding.
Our Board of Directors
has the authority, without action by our stockholders, to designate and issue preferred stock in one or more series. Our Board
of Directors may also designate the rights, preferences and privileges of each series of preferred stock, any or all of which
may be greater than the rights of the common stock. It is not possible to state the actual effect of the issuance of any shares
of preferred stock on the rights of holders of the common stock until our Board of Directors determines the specific rights of
the holders of the preferred stock. However, these effects might include: (a) restricting dividends on the common stock; (b) diluting
the voting power of the common stock; (c) impairing the liquidation rights of the common stock; and (d) delaying or preventing
a change in control of our company without further action by our stockholders.
DESCRIPTION OF DEBT
SECURITIES
General
The following description
sets forth general terms that will apply to the debt securities. We will describe the particular terms of any debt securities
that we offer in the prospectus supplement relating to those debt securities.
The debt securities will
be either our senior debt securities or our subordinated debt securities. The senior debt securities will be issued under an indenture
between us and the trustee named in the indenture. We refer to this indenture as the “senior indenture.” The subordinated
debt securities will be issued under a separate Subordinated Indenture between us and the trustee named in the indenture. We refer
to this indenture as the “subordinated indenture” and, together with the senior indenture, as the “indentures.”
Except as permitted by applicable law, the indentures have been or will be qualified under the Trust Indenture Act of 1939.
We have filed the forms
of the indentures as exhibits to the registration statement. For your convenience, we have included references to specific sections
of the indentures in the descriptions below. Capitalized terms not otherwise defined in this prospectus will have the meanings
given in the indenture to which they relate.
The following summaries
of provisions of the debt securities and the indentures are not complete and are qualified in their entirety by reference to the
provisions of the indentures and the debt securities.
Neither of the indentures
limits the principal amount of debt securities that we may issue. Each indenture provides that debt securities may be issued in
one or more series up to the principal amount that we may authorize from time to time. Each indenture also provides that the debt
securities may be denominated in any currency or currency unit that we designate. In addition, each series of debt securities
may be reopened in order to issue additional debt securities of that series in the future without the consent of the holders of
debt securities of that series. Unless otherwise described in the prospectus supplement relating to a particular offering, neither
the indentures nor the debt securities will contain any provisions to afford holders of any debt securities protection in the
event of a takeover, recapitalization or similar restructuring of our business.
Unless otherwise described
in the prospectus supplement relating to a particular offering, the senior debt securities will rank equally with all of our other
unsecured and unsubordinated debt. The subordinated debt securities will be subordinated to the prior payment in full of our senior
debt securities. We will describe the particular terms of the subordinated debt securities that we offer in the prospectus supplement
relating to those subordinated debt securities.
We will describe the specific
terms relating to each particular series of debt securities in the prospectus supplement relating to the offering of those debt
securities. The terms we will describe in the prospectus supplement will include some or all of the following:
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the
title and type of the debt securities;
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the total principal
amount or initial offering price of the debt securities;
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the date or
dates when the principal of the debt securities will be payable;
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whether we will
have the right to extend the stated maturity of the debt securities;
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whether
the debt securities will bear interest and, if so, the rate or rates, or the method for
calculating the rate or rates, of interest;
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if
the debt securities will bear interest, the date from which interest will accrue, the
dates when interest will be payable and the regular record dates for these interest payment
dates;
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the
place where the principal, premium, if any, and interest, if any, on the debt securities
will be paid, registered debt securities may be surrendered for registration of transfer,
and debt securities may be surrendered for exchange;
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any sinking
fund or other provisions that would obligate us to repurchase or otherwise redeem the
debt securities;
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the terms and
conditions upon which we will have the option or the obligation to redeem the debt securities;
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the denominations
in which any registered debt securities will be issuable;
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the identity
of each security registrar and paying agent, and the designation of the exchange rate
agent, if any, if other than the trustee;
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the
portion of the principal amount of debt securities that will be payable upon acceleration
of the maturity of the debt securities;
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the
currency used to pay principal, premium, if any, and interest, if any, on the debt securities,
if other than U.S. dollars, and whether you or we may elect to have principal, premium
and interest paid in a currency other than the currency in which the debt securities
are denominated;
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any
index, formula or other method used to determine the amount of principal, premium or
interest on the debt securities;
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any changes
or additions to the events of default, defaults or our covenants made in the applicable
indenture;
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whether
the debt securities are issuable as registered debt securities or bearer debt securities,
whether there are any restrictions relating to the form in which they are issued and
whether bearer and registered debt securities may be exchanged for each other;
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to whom interest
will be payable
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if
other than the registered holder (for registered debt securities),
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if
other than upon presentation and surrender of the related coupons (for bearer debt securities),
or
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if
other than as specified in the indentures (for global debt securities);
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whether
the debt securities are to be convertible or exchangeable for other securities and, if
so, the terms of conversion or exchange;
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particular terms
of subordination with respect to subordinated debt securities; and
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any other terms
of the debt securities consistent with the provisions of the applicable indenture.
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We may issue debt securities
as original issue discount securities to be sold at a substantial discount below their principal amount. If we issue original
issue discount securities, then we will describe the material U.S. federal income tax consequences that apply to those debt securities
in the applicable prospectus supplement.
Registration and Transfer
We presently plan to issue
each series of debt securities only as registered securities. However, we may issue a series of debt securities as bearer securities,
or a combination of both registered securities and bearer securities. If we issue senior debt securities as bearer securities,
they will have interest coupons attached unless we elect to issue them as zero coupon securities. If we issue bearer securities,
we may describe material U.S. federal income tax consequences and other material considerations, procedures and limitations in
the applicable prospectus supplement.
Holders of registered
debt securities may present the debt securities for exchange for different authorized amounts of other debt securities of the
same series and in the same aggregate principal amount at the corporate trust office of the trustee or at the office of any other
transfer agent we may designate for the purpose and describe in the applicable prospectus supplement. The registered securities
must be duly endorsed or accompanied by a written instrument of transfer. The agent will not impose a service charge on you for
the transfer or exchange. We may, however, require that you pay any applicable tax or other governmental charge. If we issue bearer
securities, we will describe any procedures for exchanging those bearer securities for other senior debt securities of the same
series in the applicable prospectus supplement. Generally, we will not allow you to exchange registered securities for bearer
securities.
In general, unless otherwise
specified in the applicable prospectus supplement, we will issue registered securities without coupons and in denominations of
$1,000 or integral multiples, and bearer securities in denominations of $5,000. We may issue both registered and bearer securities
in global form.
Conversion and Exchange
If any debt securities
will be convertible into or exchangeable for our common stock, preferred stock or other securities, the applicable prospectus
supplement will set forth the terms and conditions of the conversion or exchange, including:
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the conversion
price or exchange ratio;
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the conversion
or exchange period;
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whether the
conversion or exchange will be mandatory or at the option of the holder or us;
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provisions for
adjustment of the conversion price or exchange ratio; and
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provisions that
may affect the conversion or exchange if the debt securities are redeemed.
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Redemption
Unless otherwise indicated
in the applicable prospectus supplement, we may, at our option, redeem any series of debt securities in whole at any time or in
part from time to time. If any series of debt securities are redeemable only on or after a certain date or only upon satisfaction
of additional conditions, the applicable prospectus supplement will specify the date or the additional conditions. Unless otherwise
specified in the applicable prospectus supplement, the redemption price for debt securities will equal 100% of the principal amount
plus any accrued and unpaid interest on those debt securities.
The applicable prospectus
supplement will contain the specific terms on which we may redeem a series of debt securities prior to its stated maturity. Unless
otherwise described in the prospectus supplement relating to a particular offering, we will send a notice of redemption to holders
at least 30 days but not more than 60 days prior to the redemption date. The notice will state:
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if
less than all of the debt securities of the series are being redeemed, the particular
debt securities to be redeemed (and the principal amounts, in the case of a partial redemption);
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that
on the redemption date, the redemption price will become due and payable and any applicable
interest will cease to accrue on and after that date;
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the place or
places of payment;
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whether the
redemption is for a sinking fund; and
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any other provisions
required by the terms of the debt securities of the series that are being redeemed.
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On or before any redemption
date, we will deposit an amount of money with the trustee or with a paying agent sufficient to pay the redemption price.
Unless otherwise described
in the prospectus supplement relating to a particular offering, if we are redeeming less than all the debt securities, the trustee
will select the debt securities to be redeemed using a method it considers fair and appropriate. After the redemption date, holders
of redeemed debt securities will have no rights with respect to the debt securities except the right to receive the redemption
price and any unpaid interest to the redemption date.
Events of Default
Unless otherwise described
in the prospectus supplement relating to a particular offering, an “event of default” regarding any series of debt
securities is any one of the following events:
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default for
30 days in the payment of any interest installment when due and payable;
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default in the
making of any sinking fund payment when due;
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default
in the payment of principal or premium (if any) when due at its stated maturity, by declaration,
when called for redemption or otherwise;
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default
in the performance of any covenant in the debt securities of that series or in the applicable
indenture for 60 days after notice to us by the trustee or by the holders of 25%
in principal amount of the outstanding debt securities of that series;
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certain events
of bankruptcy, insolvency and reorganization; and
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any other event
of default provided with respect to that series of debt securities.
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We are required to file
every year with each trustee an officers’ certificate stating whether any default exists and specifying any default that
exists.
Acceleration of Maturity
Unless otherwise described
in the prospectus supplement relating to a particular offering, if an event of default has occurred and is continuing with respect
to debt securities of a particular series (except, in the case of subordinated debt securities, defaults relating to bankruptcy
events), the trustee or the holders of not less than 25% in principal amount of outstanding debt securities of that series may
declare the principal amount of outstanding debt securities of that series due and payable immediately.
Unless otherwise described
in the prospectus supplement relating to a particular offering, at any time after a declaration of acceleration of maturity with
respect to debt securities of any series has been made and before a judgment or decree for payment of the money due has been obtained
by the trustee, the holders of a majority in principal amount of the outstanding debt securities of that series by written notice
to us and the trustee, may rescind and annul the declaration and its consequences if:
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we have paid
or deposited with the trustee a sum sufficient to pay:
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all
overdue interest on all outstanding debt securities of that series and any related coupons,
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all
unpaid principal of and premium, if any, on any of the debt securities which has become
due otherwise than by the declaration of acceleration, and interest on the unpaid principal
at the rate or rates prescribed in the debt securities,
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to
the extent lawful, interest on overdue interest at the rate or rates prescribed in the
debt securities, and
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all
sums paid or advanced by the trustee and the reasonable compensation, expenses, disbursements
and advances of the trustee, its agents and counsel; and
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all
events of default with respect to debt securities of that series, other than the non-payment
of amounts of principal, interest or any premium on the debt securities which have become
due solely by the declaration of acceleration, have been cured or waived.
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No rescission will affect
any subsequent default or impair any right consequent thereon.
Waiver of Defaults
Unless otherwise described
in the prospectus supplement relating to a particular offering, the holders of not less than a majority in principal amount of
the outstanding debt securities of any series may, on behalf of the holders of all the debt securities of the series and any related
coupons, waive any past default under the applicable indenture with respect to the series and its consequences, except a default:
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in
the payment of the principal of or premium, if any, or interest on any debt security
of the series or any related coupon, or
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in
respect of a covenant or provision that cannot be modified or amended without the consent
of the holder of each outstanding debt security of the series affected thereby.
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If an event of default
with respect to debt securities of a particular series occurs and is continuing, the trustee will not be obligated to exercise
any of its rights or powers under the applicable indenture at the request or direction of any of the holders of debt securities
of the series, unless the holders have offered to the trustee reasonable indemnity and security against the costs, expenses and
liabilities that might be incurred by it in compliance with the request.
The holders of a majority
in principal amount of the outstanding debt securities of any series have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the trustee under the applicable indenture, or exercising any trust or power conferred
on the trustee with respect to the debt securities of that series. The trustee may refuse to follow directions in conflict with
law or the indenture that may expose the trustee to personal liability or may be unduly prejudicial to the other, non-directing
holders. Additionally, the trustee may take any other action the trustee deems proper which is not inconsistent with the direction.
Modification of Indenture
We and the trustee may,
without the consent of any holders of debt securities, enter into supplemental indentures for various purposes, including:
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to
evidence the succession of another entity to us and the assumption by the successor of
our covenants and obligations under the debt securities and the indenture;
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establishing
the form or terms of any series of debt securities issued under the supplemental indentures;
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adding
to our covenants for the benefit of the holders or to surrender any of our rights or
powers under the indenture;
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adding additional
events of default for the benefit of the holders;
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to
change or eliminate any provisions of the indenture provided that the change or elimination
becomes effective only when there is no debt security outstanding entitled to the benefit
of any changed or eliminated provision;
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to secure the
debt securities;
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to cure any
ambiguities or correct defective or inconsistent provisions of the indenture, provided
that holders of debt securities are not materially affected by the change;
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to evidence
and provide for acceptance of a successor trustee; and
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to comply with
the requirements of the Trust Indenture Act.
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We and the trustee may,
with the consent of the holders of not less than a majority in principal amount of the outstanding debt securities of all affected
series acting as one class, execute supplemental indentures adding any provisions to or changing or eliminating any of the provisions
of the indenture or modifying the rights of the holders of the debt securities of the series. Without the consent of the holders
of all the outstanding debt securities affected thereby, no supplemental indenture may:
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change
the stated maturity of the principal of, or any installment of principal of or interest
on, any debt security;
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reduce
the principal amount of, the rate of interest on or any premium payable upon the redemption
of, or change the manner of calculating the rate of interest on, any debt security;
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reduce
the amount of the principal of any original issue discount security that would be due
and payable upon acceleration of the maturity of the debt security;
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change
the place of payment where, or the currency in which, principal or interest on any debt
security is payable;
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impair the right
to institute suit for enforcement of payments;
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reduce
the percentage in principal amount of the outstanding debt securities of any series,
the holders of which must consent to a supplemental indenture or any waiver of compliance
with various provisions of, or defaults and covenants under, the indenture; or
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modify any of
the provisions described in this section.
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Consolidation, Merger and Sale of Assets
Unless otherwise described
in the prospectus supplement relating to a particular offering, as provided in the indentures, we may not consolidate with or
merge into any other person, or convey, transfer or lease all or substantially all of our assets to any other person, unless:
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the
person surviving or formed by the transaction is organized and validly existing under
the laws of any United States jurisdiction and expressly assumes our obligations under
the debt securities and the indentures;
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immediately
after giving effect to the transaction, no event of default will have occurred and be
continuing under the indentures; and
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the trustees
under the indentures receive certain officers’ certificates and opinions of counsel.
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Satisfaction and Discharge
We may terminate our obligations
with respect to debt securities of any series not previously delivered to the trustee for cancellation when those debt securities:
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have become
due and payable;
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will become
due and payable at their stated maturity within one year; or
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are
to be called for redemption within one year under arrangements satisfactory to the indenture
trustee for giving notice of redemption.
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We may terminate our obligations
with respect to the debt securities of a series by depositing with the trustee, as trust funds in trust dedicated solely for that
purpose, an amount sufficient to pay and discharge the entire indebtedness on the debt securities of that series. In that case,
the applicable indenture will cease to be of further effect, and our obligations will be satisfied and discharged with respect
to that series (except our obligations to pay all other amounts due under the indenture and to provide certain officers’
certificates and opinions of counsel to the trustee). At our expense, the trustee will execute proper instruments acknowledging
the satisfaction and discharge.
The Trustees
Any trustee may be deemed
to have a conflicting interest for purposes of the Trust Indenture Act and may be required to resign as trustee if there is an
event of default under the applicable indenture and, as more fully described in Section 310(b) of the Trust Indenture Act,
one or more of the following occurs:
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the
trustee is a trustee under another indenture under which our securities are outstanding;
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the
trustee is a trustee for more than one outstanding series of debt securities under a
single indenture;
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we
or our affiliates or underwriters hold certain threshold ownership beneficial ownership
interest in the trustee;
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the
trustee holds certain threshold beneficial ownership interests in us or in securities
of ours that are in default;
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the trustee
is one of our creditors; or
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the trustee
or one of its affiliates acts as an underwriter or agent for us.
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We may appoint an alternative
trustee for any series of debt securities. The appointment of an alternative trustee would be described in the applicable prospectus
supplement.
We and our affiliates
may engage in transactions with the trustee and its affiliates in the ordinary course of business.
Governing Law
Each of the indentures
are, and the related senior debt securities and subordinated debt securities will be, governed by and construed under the internal
laws of the State of New York.
DESCRIPTION OF THE WARRANTS
We may issue warrants
to purchase debt securities, preferred stock or common stock. We may offer warrants separately or together with one or more additional
warrants, debt securities, shares of preferred stock or common stock, or any combination of those securities in the form of units,
as described in the applicable prospectus supplement. If we issue warrants as part of a unit, the prospectus supplement will specify
whether those warrants may be separated from the other securities in the unit prior to the warrants’ expiration date. We
may issue the warrants under warrant agreements to be entered into between us and a bank or trust company, as warrant agent, all
as described in the prospectus supplement. If we issue the warrants under warrant agreements, the warrant agent will act solely
as our agent in connection with the warrants and will not assume any obligation or relationship of agency or trust for or with
any holders or beneficial owners of warrants.
We will describe the particular
terms of any warrants that we offer in the prospectus supplement relating to those warrants. Those terms may include the following:
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the
specific designation and aggregate number of warrants, and the price at which we will
issue the warrants;
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the
currency or currency units in which the offering price, if any, and the exercise price
are payable;
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the
date on which the right to exercise the warrants will begin and the date on which the
right will expire or, if the warrants are not continuously exercisable throughout that
period, the specific date or dates on which they are exercisable;
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whether
the warrants will be issued in fully registered form or bearer form, in definitive or
global form or in any combination of these forms;
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any
applicable material United States federal income tax considerations;
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the
identity of the warrant agent, if any, for the warrants and of any other depositaries,
execution or paying agents, transfer agents, registrars or other agents;
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the
designation, aggregate principal amount, currency, denomination and terms of any debt
securities that may be purchased upon exercise of the warrants;
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the
designation, amount, currency, denominations and terms of any preferred stock or common
stock purchasable upon exercise of the warrants;
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if
applicable, the designation and terms of the debt securities, preferred stock or common
stock with which the warrants are issued and the number of warrants issued with each
security;
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if
applicable, the date from and after which the warrants and the related debt securities,
preferred stock or common stock will be separately transferable;
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the
principal amount of debt securities or the number of shares of preferred stock or common
stock purchasable upon exercise of any warrant and the price at which those shares may
be purchased;
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provisions
for changes to or adjustments in the exercise price;
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if
applicable, the minimum or maximum number of warrants that may be exercised at any one
time;
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information
with respect to any book-entry procedures;
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any
antidilution provision of the warrants;
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any
redemption or call provisions; and
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any
additional terms of the warrants, including terms, procedures and limitations relating
to the exchange and exercise of the warrants.
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Our Outstanding Warrants
February 2017 Public
Offering Warrants
We entered a underwriting
agreement dated February 9, 2017 with certain accredited investors pursuant to which we agreed to sell in the aggregate 3,710,000
units, with each unit consisting of: (i) one share of Company common stock, (ii) a five-year Series A warrant to purchase 0.50
of a share of Company common stock, (iii) a 90-day Series B warrant to purchase one share of Company common stock, and (iv) a
five-year Series C warrant to purchase 0.50 of a share of Company common stock. The Series C warrants in a unit may only be exercised
to the extent and in proportion to a holder of the Series C warrants exercising its Series B warrants included in the unit. The
exercise price of the Series A, Series B, and Series C warrants are $1.50, $1.35 and $1.50, respectively. In addition, pursuant
to our agreement with our underwriters, as partial compensation, we issued the underwriters warrants (“Broker warrants”)
to purchase 259,700 shares of common stock exercisable for a period of 5 years from date of issuance at an exercise price of $1.35
per share. As part of this offering, 8,235,923 warrants in the aggregate were issued. Prior to March 31, 2017, certain Series
B and C warrants were exercised, leaving 7,639,621 Series A, B, C and Broker warrants in the aggregate outstanding.
On May 15, 2017, 5,087,715
warrants expired, which represented our unexercised Series B warrants along with the associated unvested Series C warrants. During
the month of June 2017, a total of 1,308,245 Series A warrants and 295,650 Series C warrants were exercised, which resulted in
additional $2.4 million in cash being received by the Company. Subsequent to June 30, 2017, 61,050 additional Series A warrants
were exercised. As of July 19, 2017, 1,664,945 Series A and Series C warrants have been exercised, leaving 886,961 Series A, Series
C, and Broker warrants outstanding.
IPO Underwriters’
Warrants
On May 31, 2016, we completed
our IPO. Pursuant to our agreement with our underwriters, as partial compensation, we issued the underwriters warrants to purchase
107,802 shares of common stock exercisable for a period of 5 years from date of issuance at an exercise price of $7.50 per share.
DESCRIPTION
OF THE UNITS
We may issue, in one or
more series, units comprised of shares of our common stock or preferred stock, warrants to purchase common stock or preferred
stock, debt securities or any combination of those securities. Each unit will be issued so that the holder of the unit is also
the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder
of each included security.
We may evidence units
by unit certificates that we issue under a separate agreement. We may issue the units under a unit agreement between us and one
or more unit agents. If we elect to enter into a unit agreement with a unit agent, the unit agent will act solely as our agent
in connection with the units and will not assume any obligation or relationship of agency or trust for or with any registered
holders of units or beneficial owners of units. We will indicate the name and address and other information regarding the unit
agent in the applicable prospectus supplement relating to a particular series of units if we elect to use a unit agent.
We will describe in the
applicable prospectus supplement the terms of the series of units being offered, including: (i) the designation and terms of the
units and of the securities comprising the units, including whether and under what circumstances those securities may be held
or transferred separately; (ii) any provisions of the governing unit agreement that differ from those described herein; and (iii)
any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units.
The other provisions regarding
our common stock, preferred stock, warrants and debt securities as described in this section will apply to each unit to the extent
such unit consists of shares of our common stock, preferred stock, warrants and/or debt securities.
PLAN OF DISTRIBUTION
We may sell the securities
covered by this prospectus in one or more of the following ways from time to time:
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to or through
underwriters or dealers for resale to the purchasers;
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directly to
purchasers;
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through agents
or dealers to the purchasers; or
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through a combination
of any of these methods of sale.
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In addition, we may enter
into derivative or other hedging transactions with third parties, or sell securities not covered by this prospectus to third parties
in privately negotiated transactions. The applicable prospectus supplement may indicate that third parties may sell securities
covered by this prospectus and the prospectus supplement, including in short sale transactions, in connection with those derivatives.
If so, the third party may use securities we pledge or that are borrowed from us or others to settle those sales or to close out
any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out
any related open borrowings of stock. The third party in those sale transactions will be an underwriter and, if applicable, will
be identified in the prospectus supplement (or a post-effective amendment thereto).
A prospectus supplement
with respect to each series of securities will include, to the extent applicable:
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the terms of
the offering;
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the
name or names of any underwriters, dealers, remarketing firms, or agents and the terms
of any agreement with those parties, including the compensation, fees, or commissions
received by, and the amount of securities underwritten, purchased, or remarketed by,
each of them, if any;
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the
public offering price or purchase price of the securities and an estimate of the net
proceeds to be received by us from any such sale, as applicable;
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any underwriting
discounts or agency fees and other items constituting underwriters’ or agents’
compensation;
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the
anticipated delivery date of the securities, including any delayed delivery arrangements,
and any commissions we may pay for solicitation of any such delayed delivery contracts;
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that the securities
are being solicited and offered directly to institutional investors or others;
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any discounts
or concessions to be allowed or reallowed or to be paid to agents or dealers; and
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any securities
exchange on which the securities may be listed.
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Any offer and sale of
the securities described in this prospectus by us, any underwriters, or other third parties described above may be effected from
time to time in one or more transactions, including, without limitation, privately negotiated transactions, either:
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at a fixed public
offering price or prices, which may be changed;
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at market prices
prevailing at the time of sale;
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at prices related
to prevailing market prices at the time of sale; or
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Offerings of securities
covered by this prospectus also may be made into an existing trading market for those securities in transactions at other than
a fixed price, either:
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on
or through the facilities of the NASDAQ Capital Market or any other securities exchange
or quotation or trading service on which those securities may be listed, quoted, or traded
at the time of sale; and/or
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to
or through a market maker otherwise than on the NASDAQ Capital Market or those other
securities exchanges or quotation or trading services.
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Those at-the-market offerings,
if any, will be conducted by underwriters acting as our principal or agent, who may also be third-party sellers of securities
as described above.
In addition, we may sell
some or all of the securities covered by this prospectus through:
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purchases
by a dealer, as principal, who may then resell those securities to the public for its
account at varying prices determined by the dealer at the time of resale or at a fixed
price agreed to with us at the time of sale;
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block
trades in which a dealer will attempt to sell as agent, but may position or resell a
portion of the block as principal in order to facilitate the transaction; and/or
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ordinary brokerage
transactions and transactions in which a broker-dealer solicits purchasers.
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Any dealer may be deemed
to be an underwriter, as that term is defined in the Securities Act of 1933 of the securities so offered and sold.
In connection with offerings
made through underwriters or agents, we may enter into agreements with those underwriters or agents pursuant to which we receive
our outstanding securities in consideration for the securities being offered to the public for cash. In connection with these
arrangements, the underwriters or agents also may sell securities covered by this prospectus to hedge their positions in any such
outstanding securities, including in short sale transactions. If so, the underwriters or agents may use the securities received
from us under those arrangements to close out any related open borrowings of securities.
We may loan or pledge
securities to a financial institution or other third party that in turn may sell the loaned securities or, in any event of default
in the case of a pledge, sell the pledged securities using this prospectus and the applicable prospectus supplement. That financial
institution or third party may transfer its short position to investors in our securities or in connection with a simultaneous
offering of other securities covered by this prospectus.
We may solicit offers
to purchase the securities covered by this prospectus directly from, and we may make sales of such securities directly to, institutional
investors or others, who may be deemed to be underwriters within the meaning of the Securities Act with respect to any resale
of such securities.
The securities may also
be offered and sold, if so indicated in a prospectus supplement, in connection with a remarketing upon their purchase, in accordance
with a redemption or repayment pursuant to their terms, or otherwise, by one or more remarketing firms acting as principals for
their own accounts or as agents for us.
If indicated in the applicable
prospectus supplement, we may sell the securities through agents from time to time. We generally expect that any agent will be
acting on a “best efforts” basis for the period of its appointment.
If underwriters are used
in any sale of any securities, the securities may be either offered to the public through underwriting syndicates represented
by managing underwriters, or directly by underwriters. Unless otherwise stated in a prospectus supplement, the obligations of
the underwriters to purchase any securities will be conditioned on customary closing conditions, and the underwriters will be
obligated to purchase all of that series of securities, if any are purchased.
Underwriters, dealers,
agents, and remarketing firms may at the time of any offering of securities be entitled under agreements entered into with us
to indemnification by us against certain civil liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments that the underwriters, dealers, agents, and remarketing firms may be required to make. Underwriters,
dealers, agents, and remarketing agents may be customers of, engage in transactions with, or perform services in the ordinary
course of business for us and/or our affiliates.
Any underwriters to whom
securities covered by this prospectus are sold by us for public offering and sale, if any, may make a market in the securities,
but those underwriters will not be obligated to do so and may discontinue any market making at any time without notice.
LEGAL
MATTERS
Schiff Hardin LLP, Washington,
DC, will pass upon the validity of the securities offered by this prospectus for us. Legal matters will be passed upon for any
underwriters, dealers or agents by counsel named in the applicable prospectus supplement.
EXPERTS
The financial statements
of Moleculin Biotech, Inc. as of December 31, 2015 and for the period from July 28, 2015 (inception) to December 31, 2015 incorporated
by reference in this prospectus have been audited by GBH CPAs, PC, an independent registered public accounting firm, as stated
in their report appearing therein. Such financial statements have been so included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
The audited financial
statements of Moleculin Biotech, Inc. as of December 31, 2016 and for the year then ended incorporated by reference in this prospectus
and elsewhere in the registration statement have been incorporated by reference in reliance upon the report of Grant Thornton
LLP, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing.
9,375,000
Units, Each Consisting of One Share of Common Stock
and
0.5 of a Warrant to Purchase One Share of Common Stock
PROSPECTUS SUPPLEMENT
April
23, 2019
Oppenheimer & Co.
Moleculin Biotech (NASDAQ:MBRX)
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