Item
1.01
|
Entry
into a Material Definitive Agreement
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On
January 23, 2019, Microbot Medical Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase
Agreement”) with accredited institutional investors (the “Purchasers”) providing for the issuance and sale by
the Company to the Purchasers of an aggregate of 250,000 shares (the “Shares”) of the Company’s common stock,
par value $0.01 per share (the “Common Stock”), at a purchase price per share of $9.875 (the “Offering”).
The gross proceeds to the Company will be approximately $2.47 million. The closing of the Offering took place on January 25, 2019.
Pursuant
to the Purchase Agreement, the Company also issued to the Purchasers unregistered warrants to purchase an aggregate of up to 250,000
shares of common stock, at a purchase price per warrant of $0.125 (the “Warrants”) for gross proceeds of $31,250,
and together with the sale of the Shares, aggregate gross proceeds of $2.50 million. Subject to certain ownership limitations
described in the Warrants, the Warrants are immediately exercisable on their date of issuance and will remain exercisable until
the one year anniversary of their date of issuance. The Warrants will be exercisable at an exercise price of $10.00 per share,
which, along with the number of shares of Common Stock issuable upon the exercise of the Warrants (the “Warrant Shares”),
will be subject for adjustment for stock splits, reverse splits, and similar capital transactions as described in the Warrants.
The Warrants will be exercisable on a “cashless” basis in certain circumstances as described in the Warrants, including,
among others, if there is no effective registration statement registering the Warrant Shares after the six-month anniversary of
their date of issuance. The Warrants provide that holders will have the right to participate in any rights offering or distribution
of assets together with the holders of Common Stock on an as-exercised basis.
The
net proceeds of the Offering to the Company are estimated to be approximately $2.13 million, after deducting placement agent fees
and other estimated offering expenses. The Company intends to use the net proceeds from this offering for the continuous development
of its SCS device for the treatment of hydrocephalus and NPH; to expand and develop additional applications deriving from its
existing IP portfolio, including the potential addition of complementary assets to the CardioSert portfolio either through internal
development, in-license or acquisition; and for working capital and other general corporate purposes.
On
October 12, 2018, the Company entered into an engagement letter, as amended (the “Engagement Letter”), with H.C. Wainwright
& Co., LLC (“Wainwright”), pursuant to which Wainwright agreed to serve as the exclusive placement agent for the
issuance and sale of the securities pursuant to the Purchase Agreement. As compensation for such placement agent services, the
Company has agreed to pay Wainwright an aggregate cash fee equal to 7.0% of the gross proceeds received by the Company from the
sale of the Shares, plus (a) a management fee equal to 1.0% of the gross proceeds; (b) a non-accountable expense allowance of
$70,000 for this offering and (c) certain other reimbursement amounts payable. The Company has also issued to Wainwright or its
designees warrants to purchase up to 5.0% of the aggregate number of Shares sold under the Purchase Agreement (the “Wainwright
Warrants”), or up to 12,500 shares of Common Stock. The Wainwright Warrants have a term of one year, are exercisable immediately
following issuance, and have an exercise price of $12.50 per share (equal to 125% of the combined offering price per Share and
Warrant). The Engagement Letter also includes indemnification obligations of the Company and other provisions customary for transactions
of this nature.
The
Shares (but not the Warrants, the Wainwright Warrants, the Warrant Shares or the shares of Common Stock issuable upon the exercise
of Wainwright Warrants (the “Wainwright Warrant Shares”)) were offered and sold by the Company through a shelf registration
statement on Form S-3 (File No.: 333-217076), which was initially filed with the Securities and Exchange Commission (the “SEC”)
on March 31, 2017 and declared effective by the SEC on April 14, 2017 and a prospectus supplement relating to the Offering dated
January 23, 2019 to be filed with the SEC.
The
Warrants, the Wainwright Warrants, the Warrant Shares and the Wainwright Warrant Shares are being offered and sold without registration
under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the exemption provided in
Section 4(a)(2) under the Securities Act and Regulation D promulgated thereunder and similar exemptions under applicable state
laws in reliance on the following facts: no general solicitation was used in the offer or sale of such securities; the recipients
of the securities had adequate access to information about the Company, through pre-existing relationships or otherwise; and such
securities were issued as restricted securities with restricted legends referring to the Securities Act. No such securities may
be offered or sold in the United States in the absence of an effective registration statement or exemption from applicable registration
requirements.
The
foregoing descriptions of the Warrant, the Wainwright Warrant, the Purchase Agreement and the Engagement Letter do not purport
to be complete and are qualified in their entirety by reference to the copy of each of the Form of Warrant, the Wainwright Warrant,
the Engagement Letter and the Form of Purchase Agreement which are attached hereto as Exhibits 4.1, 4.2, 10.1, and 10.2, respectively,
and which are incorporated herein by reference.
The
representations, warranties and covenants contained in the Purchase Agreement were made solely for the benefit of the parties
to the Purchase Agreement and may be subject to limitations agreed upon by the contracting parties. Accordingly, the Purchase
Agreement is incorporated herein by reference only to provide investors with information regarding the terms of the Purchase Agreement
and not to provide investors with any other factual information regarding the Company or its business, and should be read in conjunction
with the disclosures in the Company’s periodic reports and other filings with the SEC.