Item 1.01
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Entry into Material Definitive Agreement.
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On March 16, 2018, Organovo Holdings, Inc. (the
Company) entered into a Sales Agreement (the Sales Agreement) with H.C. Wainwright & Co., LLC and JonesTrading Institutional Services LLC (each an Agent and together, the Agents), pursuant to
which the Company may offer and sell, from time to time through the Agents, shares of its common stock in at the market sales transactions having an aggregate offering price of up to $50,000,000 (the Shares). Any Shares
offered and sold will be issued pursuant to the Companys Shelf Registration Statement on Form
S-3
(Registration
No. 333-222929)
and the related prospectus
previously declared effective by the Securities and Exchange Commission (the SEC) on February 22, 2018, as supplemented by a prospectus supplement, dated March 16, 2018.
Under the Sales Agreement, the Agents may each sell Shares by any method permitted by law and deemed to be an at the market offering as
defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended.
The Company is not obligated to make any sales of Shares under the
Sales Agreement, and if it elects to make any sales, it can set a minimum sales price for the Shares. The offering of Shares pursuant to the Sales Agreement will terminate upon the sale of an aggregate of $50,000,000 of Shares pursuant to the Sales
Agreement. In addition, the Sales Agreement may be individually terminated by the Agents or the Company, as permitted therein.
The Company will pay the
Agents a commission rate of up to 3.0% of the aggregate gross proceeds from each sale of Shares, if any, and has agreed to provide the Agents with customary indemnification and contribution rights. The Company will also reimburse the Agents for
certain specified expenses in connection with entering into the Sales Agreement.
The Company intends to use discretion in initiating sales, if any, under
the Sales Agreement and believes that it is in the best interests of its stockholders to have the flexibility to raise additional capital under favorable market conditions to support its efforts to build long-term stockholder value. There are a
number of potential benefits to raising funds through the Sales Agreement, including minimizing dilution by avoiding share price discounts, greater banking fees and the potential for share price degradation that can result from raising capital
through private or public underwritten offerings.
The Company currently intends to use the net proceeds from the sale of the securities for operating
costs, research and development and for general corporate purposes, including working capital. It may also use a portion of the net proceeds to invest in or acquire businesses or technologies that it believes are complementary to its own,
although the Company has no current plans, commitments or agreements with respect to any acquisitions as of the date hereof.
The foregoing description of
the Sales Agreement is not complete and is qualified in its entirety by reference to the full text of such agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form
8-K
and is
incorporated herein by reference. The opinion of the Companys counsel regarding the validity of the Shares that will be issued pursuant to the Sales Agreement is also filed herewith as Exhibit 5.1.
This Current Report on Form
8-K
shall not constitute an offer to sell or the solicitation of an offer to buy the
Shares, nor shall there be any offer, solicitation, or sale of the Shares in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.