Item
1.01 Entry into a Material Definitive Agreement.
On
February 11, 2021, Hancock Jaffe Laboratories, Inc., a Delaware corporation (the “Company”), closed a firm commitment
public offering of its securities for gross proceeds of approximately $41.4 million, including the exercise in full and closing
of the over-allotment option granted to the underwriters in the offering (the “Offering”). The Offering was completed
pursuant to an Underwriting Agreement (the “Underwriting Agreement”) with Ladenburg Thalmann & Co. Inc., as representative
of the several underwriters named therein (the “Underwriters”), dated February 9, 2021. In accordance with the terms
of the Underwriting Agreement, the Underwriters purchased an aggregate of 5,914,284 units (the “Units”), consisting
of (i) 5,914,284 shares of common stock (including 771,428 shares of common stock issued upon exercise of the Underwriters over-allotment
option, the “Shares”) and (ii) warrants to purchase up to 2,957,142 shares of common stock (including warrants to
purchase 385,714 shares of common stock issued upon exercise of the Underwriters over-allotment option the “Warrants”),
at a public offering price of $7.00 per Unit.
The
Warrants have an initial exercise price of $7.00 per share, subject to customary adjustments, and will expire five years from
the date of issuance. The Warrants are exercisable immediately following closing. In connection with the issuance of the Warrants,
the Company entered into a Warrant Agent Agreement (the “Warrant Agent Agreement”), with VStock Transfer, LLC, as
warrant agent.
The
Underwriting Agreement contains customary representations, warranties, covenants, agreements, and indemnification, including for
liabilities under the Securities Act of 1933, as amended. In addition, pursuant to the terms of the Underwriting Agreement, the
Company’s officers and directors agreed with the Underwriters to be subject to a lock-up period of 90 days and the Company
also agreed to similar lock-up restrictions on the issuance and sale of Company securities for 90 days following the closing date
of the Offering, in each case subject to customary exclusions.
The
total discounts and expenses of the Offering are estimated to be approximately $3.3 million. The Company intends to use the net
proceeds from the Offering for the continued development of its two lead products, VenoValve and the CoreoGraft, and for general
corporate purposes, including working capital and investing in or acquiring companies that are synergistic with or complementary
to the Company’s technologies.
The
foregoing summaries of the Underwriting Agreement, the Warrants and the Warrant Agent Agreement do not purport to be complete
and are qualified in their entirety by reference to the form of Underwriting Agreement attached to the Registration Statement
as Exhibit 1.1 and the form of Warrant and Warrant Agent Agreement attached to the Registration Statement as Exhibit 4.20.
The
Offering of the Units was pursuant to a registration statement on Form S-1, as amended (File No. 333- 251528), which was declared
effective by the United States Securities and Exchange Commission (“SEC”) on February 8, 2021 and a registration statement
on Form S-1 (File No. 333-252874) filed pursuant to Rule 462(b) of the Securities Act of 1933, as amended, which became effective
on February 8, 2021. The final prospectus relating to the Offering has been filed with the SEC.
