Tonix Pharmaceuticals Announces Pricing of $15 Million Private Placement of Convertible Redeemable Preferred Stock
October 25 2022 - 07:00AM
Tonix Pharmaceuticals Holding Corp. (Nasdaq: TNXP), a
clinical-stage biopharmaceutical company, today announced that it
has entered into a securities purchase agreement with certain
institutional investors to purchase 1,400,000 shares of Series A
convertible redeemable preferred stock and 100,000 shares of Series
B convertible redeemable preferred stock. Each share of Series A
and Series B preferred stock has a purchase price of $9.50,
representing an original issue discount of 5% of the $10.00 stated
value of each share. Each share of Series A and Series B preferred
stock is convertible into shares of the Company’s common stock at
an initial conversion price of $1.00 per share. Shares of the
Series A and Series B preferred stock are convertible at the option
of the holder at any time following the Company’s receipt of
shareholder approval for an increase to the authorized shares of
common stock of the Company from 150 million to 1 billion. The
Company and the holders of the Series A and Series B preferred
stock also entered into a registration rights agreement to register
the resale of the shares of common stock issuable upon conversion
of the Series A and Series B preferred stock. Total gross proceeds
from the offerings, before deducting discounts, placement agent’s
fees and other estimated offering expenses, is $15 million.
The Series A and Series B preferred stock
permits the holders thereof to vote together with the holders of
the Company’s common stock on a proposal to effectuate an increase
to the authorized shares of common stock of the Company at a
special meeting of Company shareholders. The Series B preferred
stock permits the holder to cast 2,500 votes per share of Series B
preferred stock on such proposal, provided, that such votes must be
cast in the same proportions as the shares of common stock and
Series A preferred stock are voted on that proposal. Except as
required by law or expressly provided by the certificate of
designation, holders of the Series A and Series B preferred stock
will not be permitted to vote on any other matters. The holders of
the Series A and Series B preferred stock agreed not to transfer,
offer, sell, contract to sell, hypothecate, pledge or otherwise
dispose of their shares of preferred stock until after the special
meeting. The holders of the Series A and Series B preferred stock
have the right to require the Company to redeem their shares of
preferred stock for cash at 105% of the stated value of such shares
commencing after the earlier of (i) the date on which the Company’s
receives shareholder approval to increase the Company’s authorized
shares of common stock or (ii) 60 days after the closing of the
issuances of the Series A and Series B preferred stock and ending
90 days after such closing. The Company has the option to redeem
the Series A and Series B preferred stock for cash at 105% of the
stated value commencing after the Company’s shareholders’ approval
of the increase to the authorized shares of common stock of the
Company, subject to the holders’ rights to convert the shares prior
to a redemption at the option of the Company.
The closing of the offering is expected to occur
on or about October 26, 2022, subject to the satisfaction of
customary closing conditions. Additional information regarding the
securities described above and the terms of the offering are
included in a Current Report on Form 8-K to be filed with the
United States Securities and Exchange Commission (“SEC”).
A.G.P./Alliance Global Partners is acting as the
sole placement agent in connection with the offering.
The Series A and Series B preferred stock and
shares of common stock into which these preferred shares are
convertible are being issued in reliance upon the exemption from
the securities registration afforded by Section 4(a)(2) of the
Securities Act of 1933, as amended (the “1933 Act”) and/or Rule 506
of Regulation D as promulgated by SEC under the 1933 Act.
This press release shall not constitute an offer
to sell or a solicitation of an offer to buy these securities, nor
shall there be any sale of these securities in any state or other
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of any such state or other jurisdiction.
About Tonix Pharmaceuticals Holding Corp.*
Tonix is a clinical-stage biopharmaceutical
company focused on discovering, licensing, acquiring and developing
therapeutics to treat and prevent human disease and alleviate
suffering. Tonix’s portfolio is composed of central nervous system
(CNS), rare disease, immunology and infectious disease product
candidates. Tonix’s CNS portfolio includes both small molecules and
biologics to treat pain, neurologic, psychiatric and addiction
conditions. Tonix’s lead CNS candidate, TNX-102 SL (cyclobenzaprine
HCl sublingual tablet), is in mid-Phase 3 development for the
management of fibromyalgia with a new Phase 3 study launched in the
second quarter of 2022 and interim data expected in the second
quarter of 2023. TNX-102 SL is also being developed to treat Long
COVID, a chronic post-acute COVID-19 condition. Tonix initiated a
Phase 2 study in Long COVID in the third quarter of 2022 and
expects interim data in the first half of 2023. TNX-1300 (cocaine
esterase) is a biologic designed to treat cocaine intoxication and
has been granted Breakthrough Therapy designation by the FDA. A
Phase 2 study of TNX-1300 is expected to be initiated in the first
quarter of 2023. TNX-1900 (intranasal potentiated oxytocin), a
small molecule in development for chronic migraine, is expected to
enter the clinic with a Phase 2 study in the fourth quarter of
2022. TNX-601 ER (tianeptine hemioxalate extended-release tablets)
is a once-daily formulation of tianeptine being developed as a
potential treatment for major depressive disorder (MDD) with a
Phase 2 study expected to be initiated in the first quarter of
2023. Tonix’s rare disease portfolio includes TNX-2900 (intranasal
potentiated oxytocin) for the treatment of Prader-Willi syndrome.
TNX-2900 has been granted Orphan Drug designation by the FDA.
Tonix’s immunology portfolio includes biologics to address organ
transplant rejection, autoimmunity and cancer, including TNX-1500,
which is a humanized monoclonal antibody targeting CD40-ligand
(CD40L or CD154) being developed for the prevention of allograft
and xenograft rejection and for the treatment of autoimmune
diseases. A Phase 1 study of TNX-1500 is expected to be initiated
in the first half of 2023. Tonix’s infectious disease pipeline
consists of a vaccine in development to prevent smallpox and
monkeypox, next-generation vaccines to prevent COVID-19, and a
platform to make fully human monoclonal antibodies to treat
COVID-19. TNX-801, Tonix’s vaccine in development to prevent
smallpox and monkeypox, also serves as the live virus vaccine
platform or recombinant pox vaccine (RPV) platform for other
infectious diseases. A Phase 1 study of TNX-801 is expected to be
initiated in Kenya in the first half of 2023. Tonix’s lead vaccine
candidate for COVID-19 is TNX-1850, a live virus vaccines based on
Tonix’s recombinant pox live virus vector vaccine platform.
*All of Tonix’s product candidates are
investigational new drugs or biologics and none have been approved
for any indication
This press release and further information about
Tonix can be found at www.tonixpharma.com.
Forward Looking Statements
Certain statements in this press release are
forward-looking within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements may be identified
by the use of forward-looking words such as “anticipate,”
“believe,” “forecast,” “estimate,” “expect,” and “intend,” among
others. These forward-looking statements are based on Tonix's
current expectations and actual results could differ materially.
There are a number of factors that could cause actual events to
differ materially from those indicated by such forward-looking
statements. These factors include, but are not limited to, risks
related to the failure to obtain FDA clearances or approvals and
noncompliance with FDA regulations; delays and uncertainties caused
by the global COVID-19 pandemic; risks related to the timing and
progress of clinical development of our product candidates; our
need for additional financing; uncertainties of patent protection
and litigation; uncertainties of government or third party payor
reimbursement; limited research and development efforts and
dependence upon third parties; and substantial competition. As with
any pharmaceutical under development, there are significant risks
in the development, regulatory approval and commercialization of
new products. Tonix does not undertake an obligation to update or
revise any forward-looking statement. Investors should read the
risk factors set forth in the Annual Report on Form 10-K for the
year ended December 31, 2021, as filed with the Securities and
Exchange Commission (the “SEC”) on March 14, 2022, and periodic
reports filed with the SEC on or after the date thereof. All of
Tonix's forward-looking statements are expressly qualified by all
such risk factors and other cautionary statements. The information
set forth herein speaks only as of the date thereof.
Contacts
Jessica Morris (corporate)Tonix
Pharmaceuticalsinvestor.relations@tonixpharma.com(862) 799-8599
Olipriya Das, Ph.D. (media)Russo
PartnersOlipriya.Das@russopartnersllc.com(646) 942-5588
Peter Vozzo (investors)ICR
Westwickepeter.vozzo@westwicke.com(443) 213-0505
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