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Item 1.01 |
Entry into a Material Definitive Agreement. |
On October 30, 2022, the Company entered into an Underwriting Agreement (the “Underwriting Agreement”) with Maxim Group LLC (the “Underwriter”), pursuant to which they agreed to issue and sell, in a registered public offering by the Company (the “Public Offering”), 9,800,000 Units, with each Unit consisting of one share of the Company’s common stock, par value $0.0001 per share (the “Common Stock”) and two warrants with a term of five years (each, a “Unit Warrant”) to purchase one share of Common Stock at an exercise price per share of $1.70, with each Unit to be offered to the public at an offering price of $1.70 per Unit (the “Units”).
In addition, pursuant to the Underwriting Agreement, the Company granted the Underwriter a 30-day option (the “Overallotment Option”) to purchase up to (i) 1,470,000 additional shares of Common Stock and/or (ii) 2,940,000 additional warrants, solely to cover over-allotments. The Underwriter partially exercised the Overallotment Option on October 31, 2022 to purchase 2,940,000 additional warrants to purchase up to 2,940,000 shares of common stock (the "Option Warrants" and, together with the Unit Warrants, the "Warrants").
The Units were offered by the Company pursuant to (i) the registration statement on Form S-1 (File No. 333-267420), as amended, which was initially filed with the Securities and Exchange Commission (the “Commission”) on September 14, 2022 and declared effective by the Commission on October 28, 2022 (the “Registration Statement”).
On November 2, 2022, the Public Offering closed, and the Company issued and sold (i) 9,800,000 Units consisting of (a) 9,800,000 shares of Common Stock, and (b) 19,800,000 Unit Warrants, and (ii) an additional 2,940,000 Option Warrants. The net proceeds to the Company, after deducting the underwriting discounts and commissions and estimated offering expenses payable by the Company, were approximately $15.4 million.
In addition, pursuant to the Underwriting Agreement, the Company also issued to the Underwriter warrants to purchase up to a total of 392,000 shares of Common Stock (equal to 4.0% of the total number of Units sold in the offering) (the “Underwriter’s Warrants”). The Underwriter’s Warrants are exercisable at a per share price of $1.87 commencing six (6) months after the effective date of the Registration Statement and will expire on the five-year anniversary of such date.
The Underwriting Agreement contains representations, warranties and covenants made by the Company that are customary for transactions of this type. Under the terms of the Underwriting Agreement, the Company has agreed to indemnify the Underwriter against certain liabilities, including liabilities under the Securities Act of 1933, as amended. In addition, pursuant to the terms of the Underwriting Agreement, the Company and its executive officers and directors have entered into lock-up agreements providing that the Company and each of these persons may not, without the prior written approval of the Underwriter, subject to limited exceptions, offer, sell, transfer or otherwise dispose of the Company’s securities for a period of 90 days following the date of the Underwriting Agreement.
On November 2, 2022, the Company entered into a warrant agency agreement with the Company’s transfer agent, Continental Stock Transfer & Trust Company, which will also act as the warrant agent for the Company, setting forth the terms and conditions of the Warrants sold in the Public Offering (the “Warrant Agency Agreement”).
The foregoing summaries of the Underwriting Agreement, the form of Warrant, the form of Underwriter’s Warrant and the Warrant Agency Agreement do not purport to be complete and are subject to, and qualified in their entirety by, such documents attached as Exhibit 1.1, 4.1, 4.2 and 4.3 respectively, to this Current Report on Form 8-K, which are incorporated herein by reference.