Item 1.01 Entry into
a Material Definitive Agreement.
On June 17, 2022, Scholar Rock Holding Corporation
(the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain purchasers
(the “Purchasers”). The Purchase Agreement provides for the sale and issuance by the Company of an aggregate of: (i) 16,326,530
shares (the “Shares”) of the Company’s common stock, $0.001 par value (the “Common Stock”), (ii) pre-funded
warrants (the “Pre-funded Warrants”) to purchase up to 25,510,205 shares of Common Stock and (iii) accompanying warrants
(the “Common Warrants” and together with the Shares and the Pre-funded Warrants, the “Securities”) to purchase
up to 10,459,181 shares of Common Stock (the “Offering”). The offering price per Share and associated Common Warrant is $4.90
and the offering price per Pre-funded Warrant and associated Common Warrant is $4.8999.
The Pre-funded Warrants are immediately
exercisable, have an exercise price of $0.0001 and may be exercised at any time after the date of issuance. A holder of Pre-funded
Warrants may not exercise the warrant if the holder, together with its affiliates, would beneficially own more than 9.99% (or, at
the election of the purchaser, 4.99%, 14.99% or 19.99%) of the number of shares of the Common Stock outstanding immediately after
giving effect to such exercise. A holder of Pre-funded Warrants may increase or decrease this percentage not in excess of
19.99% by providing at least 61 days’ prior notice to the Company.
Each Common Warrant has an exercise price per
share of $7.35, are immediately exercisable and will expire on December 31, 2025. A holder of Common Warrants may not exercise the
warrant if the holder, together with its affiliates, would beneficially own more than 4.99% (or, at the election of the purchaser, 9.99%,
14.99% or 19.99%) of the number of shares of the Common Stock outstanding immediately after giving effect to such exercise. A holder of
Common Warrants may increase or decrease this percentage not in excess of 19.99% by providing at least 61 days’ prior notice
to the Company.
The Offering is expected to result in gross
proceeds to the Company of approximately $205.0 million. The net proceeds to the Company from the Offering are expected to be
approximately $195.4 million, after deducting placement agent fees and expenses and estimated offering expenses payable by the
Company. The Company intends to use the net proceeds from the Offering, together with existing cash, cash equivalents and
investments, to advance its ongoing and future clinical programs, to further develop its technology platform and to continue to
advance its preclinical pipeline. Any remaining proceeds will be used for other ongoing research and development activities and
general corporate purposes.
The Purchase Agreement contains customary representations,
warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company, other obligations
of the parties and termination provisions.
On June 17, 2022, the Company also
entered into a placement agency agreement (the “Placement Agency Agreement”) with J.P. Morgan Securities LLC as lead
placement agent and Piper Sandler & Co. as co placement agent (together, the “Placement Agents”). Pursuant to
the terms of the Placement Agency Agreement, the Placement Agents agreed to use their reasonable best efforts to arrange for the
sale of the Securities and the Company agreed to pay the Placement Agents a cash fee equal to 4.5% of the gross proceeds generated
from the sale of the Shares and Pre-funded Warrants.
The Placement Agency Agreement contains customary
representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company
and the Placement Agents, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and
termination provisions.
Pursuant to the Purchase Agreement, the Company has agreed to certain restrictions on the issuance and sale of shares of the Company’s securities
for a period of 60 days following the date of the Purchase Agreement, subject to certain exceptions.
The Offering was made pursuant to a
Registration Statement (No. 333-254057) on Form S-3, which was filed by the Company with the Securities and Exchange
Commission on March 7, 2022, and declared effective on April 13, 2022, as supplemented by a prospectus supplement dated
June 17, 2022.
The Placement Agency Agreement, form of Purchase
Agreement, form of Pre-funded Warrant and form of Common Warrant, are filed as Exhibits 1.1, 10.1, 4.1 and 4.2, respectively, to this
Current Report on Form 8-K and are incorporated herein by reference. The above descriptions of the terms of the Placement Agency
Agreement, form of Purchase Agreement, form of Pre-funded Warrant and form of Common Stock Warrant do not purport to be complete descriptions
of the rights and obligations thereunder and are qualified in their entirety by reference to the full extent of such exhibits.
The legal opinion of
Goodwin Procter LLP relating to the legality of the issuance and sale of the Securities in the Offering
is attached as Exhibit 5.1 to this Current Report on Form 8-K.