Item
1.01. Entry into a Material Definitive Agreement.
On
May 17, 2018, Marina Biotech, Inc. (the “Company”) conducted the second and final closing (the “Final Closing”)
of the Company’s private placement (the “Private Placement”) of shares of the Series E convertible preferred
stock, par value $0.01 per share, of the Company (the “Preferred Stock”), and warrants to purchase shares of the common
stock, par value 0.006 per share, of the Company (the “Common Stock”). The initial closing (the “Initial Closing”)
of the Private Placement was previously reported by the Company on its Current Report on Form 8-K filed with the Securities and
Exchange Commission on April 19, 2018 (the “Prior 8-K”).
In
connection with the Final Closing, the Company entered into Subscription Agreements (the “Purchase Agreements”) with
certain accredited investors pursuant to which the Company sold 478 shares of Preferred Stock at a purchase price of $5,000
per share. Each share of Preferred Stock is initially convertible into shares of Common Stock at a conversion price of $0.50 per
share of Common Stock. In addition, each investor received a 5-year warrant (the “Warrants”, and collectively with
the Preferred Stock, the “Securities”) to purchase 0.75 shares of Common Stock for each share of Common Stock issuable
upon the conversion of the Preferred Stock purchased by such investor at an exercise price equal to $0.55 per share of Common
Stock, subject to adjustment thereunder.
The
Company received total gross proceeds of approximately $2.39 million from the Final Closing, prior to deducting placement agent
fees and estimated expenses payable by the Company associated with the Final Closing. The Company currently intends to use the
proceeds of the Private Placement for funding operations, working capital needs, capital expenditures, the repayment of certain
liabilities and other general corporate purposes in pursuit of advancing its commercial, clinical and preclinical efforts, including
advancing its commercial operations relating to the sale and promotion of the Company’s Prestalia® product. Prestalia
is a single-pill fixed dose combination of perindopril arginine, an angiotensin-converting-enzyme inhibitor, and amlodipine besylate,
a calcium channel blocker, which has been approved by the U.S. Food and Drug Administration and is marketed in the U.S. The Company
received aggregate gross proceeds of approximately $14.1 million from the Initial Closing and the Final Closing, prior to deducting
placement agent fees and estimated expenses payable by the Company associated with the Initial Closing and the Final Closing,
respectively.
The
rights, preferences and privileges of the Preferred Stock issued at the Final Closing are set forth in a Certificate of Designation
of Preferences, Rights and Limitations of the Series E Convertible Preferred Stock of Marina Biotech, Inc. (the “Certificate
of Designation”) that was filed with the Secretary of State of the State of Delaware on April 16, 2018. The Certificate
of Designation was filed as Exhibit 3.1 to the Prior 8-K, and the rights, preferences and privileges of the Preferred Stock were
summarized in the Prior 8-K. The form of Warrant that was issued at the Final Closing was filed as Exhibit 4.1 to the Prior 8-K,
and the terms and provisions thereof were summarized in the Prior 8-K.
The
Securities were offered and sold in a private placement pursuant to exemptions from the registration requirements of the Securities
Act of 1933, as amended (the “Securities Act”), afforded by Section 4(a)(2) of the Securities Act and Rule
506(b) of Regulation D promulgated thereunder. To the extent that any shares of Common Stock are issued in connection with the
conversion of the Preferred Stock or the exercise of the Warrants, the Common Stock may not be offered, transferred or sold in
the United States absent registration or the availability of an applicable exemption from the registration requirements of the
Securities Act.
Maxim
Merchant Capital, a division of Maxim Group LLC, acted as placement agent in connection with the Private Placement pursuant to
a Placement Agency Agreement, dated February 8, 2018 (the “Placement Agency Agreement”). Under the Placement Agency
Agreement, the Company agreed: (i) to pay the placement agent a cash commission equal to ten percent (10%) of the aggregate gross
proceeds of the Securities sold at each closing (including the conversion into Securities of certain outstanding promissory notes);
(ii) to grant to the placement agent or its designees 5-year warrants to purchase shares of Common Stock equal to ten percent
(10%) of the aggregate number of shares of Common Stock issuable upon conversion of the Preferred Stock sold at each closing (including the conversion into Securities of certain outstanding promissory notes), at
a price equal to the exercise price of the Warrants; (iii) to reimburse the placement agent for certain reasonable and documented
expenses; and (iv) to grant the placement agent a right of first refusal to act as lead managing underwriter and book runner for
any future public and private equity and public debt offering for a period of fifteen months from the final closing of the Private
Placement.
In
connection with the Initial Closing and the Final Closing, the Company’s placement agent, pursuant to the Placement Agency
Agreement, received a cash fee of approximately $1.48 million, plus warrants to purchase 2,958,460 shares of Common Stock at an
exercise price equal to $0.55.
The
foregoing summaries of the material terms and provisions of the Placement Agency Agreement, the Certificate of Designation, the
form of Warrant and the form of Subscription Agreement are not complete and are qualified in their entirety by reference to the
full text thereof, copies of each of which are filed herewith as Exhibits 10.1, 3.1, 4.1 and 10.2, respectively, and incorporated
by reference herein.