Item 1.01
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Entry into a Material Definitive Agreement.
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On January 12, 2018, AquaBounty Technologies, Inc.
(the Company) entered into an underwriting agreement (the Underwriting Agreement) with H.C. Wainwright & Co., LLC, as the representative of the underwriters named therein (collectively, the Underwriters),
relating to the public offering (the Offering) of 3,692,307 shares of the Companys common stock, par value $0.001 per share (the Common Stock), together with warrants to purchase up to 3,692,307 shares of Common Stock
with an initial exercise price of $3.25 per share of Common Stock (the Warrants), subject to adjustment as described in the Warrants, at an offering price of $3.25 per fixed combination consisting of one share of Common Stock and an
associated Warrant to purchase one share of Common Stock.
The Warrants are exercisable beginning on the date of issuance and will expire five years
thereafter. The exercise price and number of shares of Common Stock issuable upon exercise of the Warrants will be subject to adjustment in the event of any stock split, reverse stock split, stock dividend, recapitalization, reorganization, or
similar transaction, among other events as described in the Warrants. The holders must surrender payment in cash of the aggregate exercise price of the shares being acquired upon exercise of the Warrants. In addition, the Warrant holders are
entitled to a cashless exercise option if, at any time of exercise, there is no effective registration statement registering, or no current prospectus available for, the issuance or resale of the shares of Common Stock underlying the
Warrants. In the event of a sale of the Company or other similar fundamental transaction at any time while the Warrants are outstanding, each holder is entitled to receive, upon exercise of the Warrant, the same amount and kind of securities, cash,
or property as that holder would have been entitled to receive upon the occurrence of such fundamental transaction if that holder had been, immediately prior to such fundamental transaction, the holder of the number of shares of Common Stock then
issuable upon exercise of the Warrant, and any additional consideration payable as part of the fundamental transaction.
The Offering is expected to close
on January 17, 2018, subject to the satisfaction of customary closing conditions. The Company has also granted the Underwriters a
30-day
option to purchase up to 553,846 additional shares of Common Stock
and/or additional Warrants to purchase 553,846 shares of common stock at the Offering Price, less underwriting discounts and commissions. The net proceeds to the Company are expected to be approximately $10.9 million, assuming no exercise of
the Underwriters overallotment option and no exercise of the Warrants, and after deducting underwriting discounts and commissions and payment of other estimated expenses associated with the Offering that are payable by the Company.
The Offering is being made pursuant to the Companys registration statement on Form
S-1
(File
No. 333-221435),
which was initially filed with the Securities and Exchange Commission (the Commission) on November 8, 2017, subsequently amended on December 7, 2017, January 9, 2018,
and January 11, 2018 and declared effective by the Commission on January 12, 2018, and a registration statement on Form
S-1
filed by the Company with the Commission on January 12, 2018, which
became effective upon filing in accordance with Rule 462(b) under the Securities Act of 1933, as amended (the Securities Act).
The
Underwriting Agreement contains customary representations, warranties, and agreements by the Company; customary conditions to closing; indemnification obligations of the Company and the Underwriter, including for liabilities under the Securities
Act; other obligations of the parties; and termination provisions. Pursuant to the Underwriting Agreement, the Company agreed, subject to certain exceptions, not to offer, issue, or sell any shares of Common Stock or securities convertible into or
exercisable or exchangeable for shares of Common Stock for a period of ninety days following the Offering without the prior written consent of the Underwriter. The foregoing is only a brief description of the terms of the Underwriting Agreement,
does not purport to be a complete description of the rights and obligations of the parties thereunder, and is qualified in its entirety by reference to the Underwriting Agreement that is filed as Exhibit 1.1 to this Current Report on
Form 8-K
and incorporated by reference herein.