GridAI Technologies Corp S-3, filed May 26, 2021
GridAI Technologies Corp. (GRDX)
S-3
2021-05-26
View Original
Added on
October 17, 2026
As filed with the Securities and Exchange Commission on May 26,
2021
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AZURRX BIOPHARMA, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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2834
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46-4993860
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(State or Other Jurisdiction of
Incorporation or Organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification Number)
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1615 South Congress Avenue, Suite 103
Delray Beach, Florida 33445
(646) 699-7855
(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive
offices)
James Sapirstein, President, Chief Executive Officer and
Chairman
AzurRx BioPharma, Inc.
1615 South Congress Avenue, Suite 103
Delray Beach, Florida 33445
(646) 699-7855
(Name, address, including zip code, and telephone
number,
including area code, of agent for service)
Copies to
James O’Grady, Esq.
Michael J. Lerner, Esq.
Lowenstein Sandler LLP
1251 Avenue of the Americas
New York, New York 10020
Telephone: (212) 262-6700
Approximate date of commencement of proposed sale to the
public: From time to
time after this registration statement becomes
effective.
If the only securities being registered on this form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box. ☐
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. ☒
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act of 1933,
please check the following box and list the Securities Act
registration statement number of the earlier effective registration
statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same
offering. ☐
If this Form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that shall
become effective upon filing with the Commission pursuant to Rule
462(e) under the Securities Act, check the following
box. ☐
If this Form is a post-effective amendment to a registration
statement filed pursuant to General Instruction I.D. filed to
register additional securities or additional classes of securities
pursuant to Rule 413(b) under the Securities Act, check the
following box. ☐
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer,
smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,”
“accelerated filer,” “smaller reporting
company,” and “emerging growth company” in Rule
12b-2 of the Exchange Act.
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Large accelerated filer
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[ ]
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Accelerated filer
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[ ]
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Non-accelerated filer
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[X]
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Smaller reporting company
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[X]
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Emerging growth company
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[X]
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If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 7(a)(2)(B) of the Securities
Act. ☐
CALCULATION OF
REGISTRATION FEE
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Title
of each class of
securities
to be registered(1)
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Amount
to be registered
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Proposed
maximum offering price per unit
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Proposed
maximum aggregate offering price
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Amount
of registration fee
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Primary
Offering
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(1)(2)
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(1)(2)
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(1)(2)
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(2)
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Common Stock, par
value $0.0001 per share(3)
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Preferred Stock,
par value $0.0001 per share(4)
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Warrants(5)
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Subscription
Rights(6)
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Units(7)
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Total
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$150,000,000
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$150,000,000
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$16,365
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Secondary
Offering
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Common Stock, par
value $0.0001 per share
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3,464,664(8)(9)
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0.875(8)(9)
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3,031,581(8)(9)
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331(8)(9)
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Total Registration
Fee
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$16,696
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(1)
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In no
event will the aggregate offering price of all securities issued
from time to time by the registrant in the primary offering under
this registration statement exceed $150,000,000 or its equivalent
in any other currency, currency units, or composite currency or
currencies. The securities covered by this registration statement
may be sold separately, together or as units with other securities
registered under this registration statement.
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(2)
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The
proposed maximum aggregate price for the primary offering has been
estimated solely for the purpose of calculating the registration
fee pursuant to Rule 457(o) under the Securities Act of 1933, as
amended (the “Securities Act”).
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(3)
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Subject
to note (1), this registration statement covers such an
indeterminate amount of common stock (with accompanying purchase
rights, if any) as may be sold, from time to time, at indeterminate
prices, by the registrant and such indeterminate number of shares
of common stock as may, from time to time, be issued upon
conversion or exchange of other securities registered hereunder, to
the extent any such securities are, by their terms, convertible or
exchangeable for common stock.
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(4)
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Subject
to note (1), this registration statement covers such an
indeterminate number of shares of preferred stock (with
accompanying purchase rights, if any) as may be sold from time to
time at indeterminate prices by the registrant. Also covered is
such an indeterminate amount of common stock (with accompanying
purchase rights, if any) (i) as may be issuable or deliverable upon
conversion of shares of preferred stock, and (ii) as may be
required for delivery upon conversion of shares of preferred stock
as a result of anti-dilution provisions.
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(5)
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Subject
to note (1), this registration statement covers such an
indeterminate amount and number of warrants (including subscription
rights) representing rights to purchase common stock and preferred
stock registered under this registration statement as may be sold
from time to time at indeterminate prices by the registrant. Also
covered is such an indeterminate amount of common stock and
preferred stock (in each case, with accompanying purchase rights,
if any) (i) as may be issuable or deliverable upon exercise of
warrants, and (ii) as may be required for delivery upon exercise of
any warrants as a result of anti-dilution provisions.
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(6)
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Subject
to note (1), this registration statement covers such an
indeterminate amount and number of subscription rights,
representing rights to purchase common stock, preferred stock and
warrants registered under this registration statement, as may be
sold from time to time at indeterminate prices by the registrant.
Also covered is such an indeterminate amount of common stock,
preferred stock and warrants (in each case, with accompanying
purchase rights, if any) (i) as may be issuable or deliverable upon
exercise of subscription rights, and (ii) as may be required for
delivery upon exercise of any subscription rights as a result of
anti-dilution provisions.
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(7)
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Each
unit will represent an interest in two or more securities, which
may or may not be separable from one another.
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(8)
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Pursuant
to Rule 416 under the Securities Act, the shares of common stock
being registered hereunder include such indeterminate number of
shares of common stock as may be issuable with respect to the
shares being registered hereunder as a result of stock splits,
stock dividends or similar transactions.
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(9)
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The
proposed maximum offering price per unit for the secondary offering
was determined pursuant to Rule 457(c) under the Securities Act
based on the average high and low prices reported for the
registrant’s common stock on May 21, 2021.
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The
registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states
that this registration statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act of 1933 or
until the registration statement shall become effective on such
date as the Commission acting pursuant to said Section 8(a), may
determine.
EXPLANATORY
NOTE
This
registration statement contains three prospectuses:
●
a base
prospectus which covers the offering, issuance and sale by the
registrant of up to a maximum aggregate offering price of
$150,000,000 of the registrant’s common stock, preferred
stock, warrants, subscription rights and/or units;
●
a sales
agreement prospectus supplement covering the offering, issuance and
sale by the registrant of up to a maximum aggregate offering price
of $50,000,000 of the registrant’s common stock that may be
issued and sold under a sales agreement with H.C. Wainwright &
Co., LLC; and
●
a
secondary offering prospectus which covers the offer and sale by
the selling stockholders named therein of up to 3,464,664 shares of
common stock from time to time in one or more
offerings.
The
base prospectus immediately follows this explanatory note. The
specific terms of any securities to be offered pursuant to the base
prospectus will be specified in a prospectus supplement to the base
prospectus. The sales agreement prospectus supplement immediately
follows the base prospectus. The common stock that may be offered,
issued and sold by the registrant under the sales agreement
prospectus supplement is included in the $150,000,000 of securities
that may be offered, issued and sold by the registrant under the
base prospectus. Upon termination of the sales agreement with H.C.
Wainwright & Co., LLC, any portion of the $50,000,000 included
in the sales agreement prospectus supplement that is not sold
pursuant to the sales agreement will be available for sale in other
offerings pursuant to the base prospectus and a corresponding
prospectus supplement, and if no shares are sold under the sales
agreement, the full $50,000,000 of securities may be sold in other
offerings pursuant to the base prospectus and a corresponding
prospectus supplement. The secondary offering prospectus
immediately follows the sales agreement prospectus. The 3,464,664
shares of common stock that may be offered and sold under the
secondary offering prospectus is not included in the $150,000,000
of securities that may be offered, issued and sold by us under the
base prospectus.
The information in this prospectus is not complete and may be
changed. A registration statement relating to these securities has
been filed with the Securities and Exchange Commission. These
securities may not be sold until the registration statement is
declared effective. This prospectus is not an offer to sell these
securities and is not soliciting an offer to buy these securities,
nor shall there be any sale of these securities in any state or
other jurisdiction where such offer, solicitation or sale is not
permitted or would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
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PROSPECTUS
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SUBJECT TO COMPLETION
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DATED MAY 26, 2021
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AzurRx BioPharma, Inc.
$150,000,000
Common Stock
Preferred Stock
Warrants
Subscription Rights
Units
We may offer, issue and sell from time to time together or
separately, in one or more offerings, any combination of (i) our
common stock, (ii) our preferred stock, which we may issue in one
or more series, (iii) warrants, (iv) subscription rights and (v)
units. The preferred stock, warrants and subscription rights may be
convertible into, or exercisable or exchangeable for, common or
preferred stock or other securities of ours. The units may consist
of any combination of the securities listed above.
The aggregate public offering price of
the securities that we may offer will not exceed
$150,000,000. We
will offer the securities in an amount and on terms that market
conditions will determine at the time of the offering. Our common
stock is listed on the Nasdaq Capital Market under the symbol
“AZRX.” The last reported sale price for our common
stock on May 21, 2021 as quoted on the Nasdaq Capital Market was
$0.89 per share. You are urged to obtain current market quotations
of our common stock. We have no preferred stock, warrants,
subscription rights or units listed on any market. Each prospectus
supplement will indicate if the securities offered thereby will be
listed on any securities exchange.
Should we offer any of the securities described in this prospectus,
we will provide you with the specific terms of the particular
securities being offered in supplements to this prospectus. You
should read this prospectus and any supplement, together with
additional information described under the headings “Where
You Can Find More Information” and “Incorporation of
Certain Information by Reference” carefully before you
invest. This prospectus may not be used to sell securities unless
accompanied by a prospectus supplement.
We may sell these securities directly to our stockholders or to
other purchasers or through agents on our behalf or through
underwriters or dealers as designated from time to time. If any
agents or underwriters are involved in the sale of any of these
securities, the applicable prospectus supplement will provide the
names of the agents or underwriters and any applicable fees,
commissions or discounts.
We are an “emerging growth company” as defined in
Section 2(a) of the Securities Act of 1933, as amended the
(“Securities Act”), and we have elected to comply with
certain reduced public company reporting requirements.
Investing in our securities involves a high degree of risk. See
“Risk Factors” beginning on page 2 of this prospectus
and the documents incorporated by reference into this prospectus
for a discussion of the risks that you should consider in
connection with an investment in our securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus is
,
2021.
TABLE OF
CONTENTS
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AzurRx
BioPharma, Inc. is referred to herein as “AzurRx,”
“the Company,” “we,” “us,” and
“our,” unless the context indicates
otherwise.
You may
only rely on the information contained in this prospectus and any
accompanying prospectus supplement or that we have referred you to.
We have not authorized anyone to provide you with different
information. This prospectus and any prospectus supplement do not
constitute an offer to sell or a solicitation of an offer to buy
any securities other than the securities offered by this prospectus
and the prospectus supplement. This prospectus and any prospectus
supplement do not constitute an offer to sell or a solicitation of
an offer to buy any securities in any circumstances in which such
offer or solicitation is unlawful. Neither the delivery of this
prospectus or any prospectus supplement nor any sale made hereunder
shall, under any circumstances, create any implication that there
has been no change in our affairs since the date of this prospectus
or such prospectus supplement or that the information contained by
reference to this prospectus or any prospectus supplement is
correct as of any time after its date.
This
prospectus is part of a registration statement that we filed with
the Securities and Exchange Commission, or SEC, using a
“shelf” registration process. Under this shelf
registration process, we may from time to time offer and sell, in
one or more offerings, any or all of the securities described in
this prospectus, separately or together, up to an aggregate
offering price of $150,000,000. This prospectus provides you with a
general description of our securities being offered. When we issue
the securities being offered by this prospectus, we will provide a
prospectus supplement (which term includes, as applicable, the
at-the-market sales agreement prospectus supplement filed with the
registration statement of which this prospectus forms a part) that
will contain specific information about the terms of that offering.
The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this
prospectus and any prospectus supplement together with additional
information described under the heading “Where You Can Find
More Information” and “Incorporation of Certain
Information By Reference.”
PROSPECTUS SUMMARY
The
following summary highlights some information from this prospectus.
It is not complete and does not contain all of the information that
you should consider before making an investment decision. You
should read this entire prospectus, including the “Risk
Factors” section on page 2 and the disclosures to which that
section refers you, the financial statements and related notes and
the other more detailed information appearing elsewhere or
incorporated by reference into this prospectus before investing in
any of the securities described in this prospectus.
Overview
We are engaged in the research and development of
targeted, non-systemic therapies for the treatment of patients with
gastrointestinal (“GI”) diseases. Non-systemic therapies are
non-absorbable drugs that act locally, i.e. in the intestinal
lumen, skin or mucosa, without reaching an individual’s
systemic circulation. We are focused on
developing our pipeline of gut-restricted GI clinical drug
candidates, including MS1819 and niclosamide.
Our lead drug candidate
is MS1819, a recombinant lipase for the treatment of exocrine
pancreatic insufficiency (“EPI”)
in patients with cystic
fibrosis (“CF”) and chronic pancreatitis
(“CP”), currently in two
Phase 2 CF clinical trials. In March 2021, we announced topline results from
our Phase 2b OPTION 2 monotherapy trial, and in May 2021, we
announced positive interim results from the first 18 patients in
our Phase 2 Combination trial in Europe.
In 2021, we intend to
launch two new clinical programs using proprietary formulations of
niclosamide, a small molecule
with anti-helminthic, anti-viral and anti-inflammatory
properties; FW-1022, for
Severe Acute Respiratory Syndrome Coronavirus 2
(“COVID-19”)
gastrointestinal infections, and FW-420, for Grade 1 and Grade 2
Immune Checkpoint Inhibitor-Associated Colitis
(“ICI-AC”)
and diarrhea in advanced stage oncology patients.
We initiated our Phase 2 RESERVOIR
clinical trial using a proprietary oral immediate-release tablet
formulation of micronized niclosamide (FW-1022) for the treatment
of COVID-19 related GI infections in April 2021, and we are
preparing to initiate our Phase 1b/2a PASSPORT ICI-AC trial using
both an oral immediate-release tablet and a topical rectal enema
foam formulations of niclosamide (FW-420) in the first half of
2021.
Corporate Information
We were incorporated on January 30, 2014 in the State of
Delaware. In June 2014, we acquired 100% of the issued
and outstanding capital stock of AzurRx SAS. Our principal
executive offices are located at 1615 South Congress Avenue, Suite
103, Delray Beach, Florida 33445. Our telephone number is (646)
699-7855. We maintain a website at www.azurrx.com. The information
contained on our website is not, and should not be interpreted to
be, a part of this prospectus.
Before
purchasing any of the securities you should carefully consider the
risk factors incorporated by reference in this prospectus from our
Annual Report on Form 10-K for the fiscal year ended December 31,
2020 and any subsequent updates described in our Quarterly Reports
on Form 10-Q and Current Reports on Form 8-K, as well as the risks,
uncertainties and additional information set forth in any
prospectus supplement, in our SEC reports on Forms 10-K, 10-Q and
8-K and in the other documents incorporated by reference in this
prospectus. For a description of these reports and documents, and
information about where you can find them, see “Where You Can
Find More Information” and “Incorporation of Certain
Information By Reference.” Additional risks not presently
known or that we presently consider to be immaterial could
subsequently materially and adversely affect our financial
condition, results of operations, business and
prospects.
FORWARD-LOOKING STATEMENTS
This
prospectus, including the documents that we incorporate by
reference, contains forward-looking statements as that term is
defined in the federal securities laws. The events described in
forward-looking statements contained in this prospectus, including
the documents that we incorporate by reference, may not occur.
Generally, these statements relate to our business plans or
strategies, projected or anticipated benefits or other consequences
of our plans or strategies, financing plans, projected or
anticipated benefits from acquisitions that we may make, or
projections involving anticipated revenues, earnings or other
aspects of our operating results or financial position, and the
outcome of any contingencies. Any such forward-looking statements
are based on current expectations, estimates and projections of
management. We intend for these forward-looking statements to be
covered by the safe-harbor provisions for forward-looking
statements. Words such as “may,” “expect,”
“believe,” “anticipate,”
“project,” “plan,” “intend,”
“estimate,” and “continue,” and their
opposites and similar expressions are intended to identify
forward-looking statements. We caution you that these statements
are not guarantees of future performance or events and are subject
to a number of uncertainties, risks and other influences, many of
which are beyond our control that may influence the accuracy of the
statements and the projections upon which the statements are based.
Factors that may cause our results to materially differ from those
expressed or implied by forward-looking statements include, but are
not limited to, the risks and uncertainties discussed in the
“Risk Factors” section on page 2 of this prospectus, in
any prospectus supplement, in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2020 or in other reports we file
with the SEC.
Any one
or more of these uncertainties, risks and other influences could
materially affect our results of operations and whether
forward-looking statements made by us ultimately prove to be
accurate. Our actual results, performance and achievements could
differ materially from those expressed or implied in these
forward-looking statements. We undertake no obligation to publicly
update or revise any forward-looking statements, whether from new
information, future events or otherwise.
You
should rely only on the information in this prospectus. We have not
authorized any other person to provide you with different
information. If anyone provides you with different or inconsistent
information, you should not rely upon it.
USE OF PROCEEDS
Unless
we inform you otherwise in the prospectus supplement relating to a
particular offering of securities, we will use the net proceeds
from the sale of the securities offered by this prospectus and the
exercise price from the exercise of any convertible securities, if
any, for general corporate purposes, which may include funding
research, development and product manufacturing, clinical trials,
acquisitions or investments in businesses, products or technologies
that are complementary to our own, increasing our working capital,
reducing indebtedness, and capital expenditures.
When
particular securities are offered, the prospectus supplement
relating to that offering will set forth our intended use of the
net proceeds received from the sale of those securities we sell.
Pending the application of the net proceeds for these purposes, we
expect to invest the proceeds in short-term, interest-bearing
instruments or other investment-grade securities.
General
The
descriptions of the securities contained in this prospectus,
together with the applicable prospectus supplements, summarize all
of the material terms and provisions of the various types of
securities that we may offer. We will describe in the applicable
prospectus supplement relating to any securities the particular
terms of the securities offered by that prospectus supplement. If
we indicate in the applicable prospectus supplement, the terms of
the securities may differ from the terms we have summarized below.
We may also include in the prospectus supplement information about
material United States federal income tax considerations relating
to the securities, and the securities exchange, if any, on which
the securities will be listed.
We may
sell from time to time, in one or more offerings:
●
common
stock;
●
preferred
stock;
●
subscription
rights to purchase shares of common stock or preferred
stock;
●
warrants
to purchase shares of common stock or preferred stock;
and
●
units
consisting of any combination of the securities listed
above.
In this
prospectus, we refer to the common stock, preferred stock,
subscription rights, warrants and units collectively as
“securities.” The total dollar amount of all securities
that we may sell pursuant to this prospectus will not exceed
$150,000,000.
This
prospectus may not be used to consummate a sale of securities
unless it is accompanied by a prospectus supplement.
The following summary of the rights of our capital stock is not
complete and is subject to and qualified in its entirety by
reference to our certificate of incorporation and bylaws, copies of
which are filed as exhibits to our Annual Report on Form 10-K for
the year ended December 31, 2020, filed with the SEC on March 31,
2021, and the Certificate of Designations and forms of securities,
copies of which are filed as exhibits to the registration statement
of which this prospectus forms a part , which are incorporated by
reference herein.
General
Our authorized capital stock consists of:
●
250,000,000 shares
of common stock, par value $0.0001 per share; and
●
10,000,000 shares
of preferred stock, par value $0.0001.
As of May 21, 2021, there were
250,000,000 shares of common stock, and 10,000,000 shares of
preferred stock, of which a series of 5,194.81 shares of Series B
Convertible Preferred Stock (the “Series B Preferred
Stock”) and a
series of 75,000 shares of Series C 9.00% Convertible Junior
Preferred Stock (the “Series C Preferred
Stock”) have
been designated.
As of May 21, 2021, there were 78,575,131 shares of common stock
issued and outstanding, 893.52 shares of Series B Preferred Stock
issued and outstanding and 0 shares of Series C Preferred Stock
issued and outstanding.
The
additional shares of our authorized capital stock available for
issuance may be issued at times and under circumstances so as to
have a dilutive effect on earnings per share and on the equity
ownership of the holders of our common stock. The ability of our
board of directors to issue additional shares of stock could
enhance the board’s ability to negotiate on behalf of the
stockholders in a takeover situation but could also be used by the
board to make a change of control more difficult, thereby denying
stockholders the potential to sell their shares at a premium and
entrenching current management. The following description is a
summary of the material provisions of our capital stock. You should
refer to our certificate of incorporation, as amended (the
“Charter”), and
our bylaws, as amended
and restated (the “Bylaws”), both of which are on
file with the SEC as exhibits to previous SEC filings, for
additional information. The summary below is qualified by
provisions of applicable law.
Common Stock
Holders of our common stock are entitled to one
vote for each share held of record on all matters on which the
holders are entitled to vote (or consent pursuant to written
consent). Directors are elected by a plurality of the votes present
in person or represented by proxy and entitled to
vote. Our Charter and Bylaws,
do not provide for cumulative voting rights.
Holders
of our common stock are entitled to receive, ratably, dividends
only if, when and as declared by our board of directors out of
funds legally available therefor and after provision is made for
each class of capital stock having preference over the common
stock.
In
the event of our liquidation, dissolution or winding-up, the
holders of common stock are entitled to share, ratably, in all
assets remaining available for distribution after payment of all
liabilities and after provision is made for each class of capital
stock having preference over the common stock.
Holders of our common stock have no preemptive, conversion or
subscription rights, and there are no redemption or sinking fund
provisions applicable to the common stock. The rights, preferences
and privileges of the holders of common stock are subject to, and
may be adversely affected by, the rights of the holders of shares
of any series of our preferred stock that we may designate and
issue in the future.
Transfer Agent
The transfer agent and registrar for our common stock is Colonial
Stock Transfer, 66 Exchange Place, 1st Floor, Salt Lake City, Utah
84111, Tel: (801) 355-5740.
Preferred Stock
We currently have up to 10,000,000 shares of preferred stock, par
value $0.0001 per share, authorized and available for issuance in
one or more series. Our board of directors is authorized to divide
the preferred stock into any number of series, fix the designation
and number of each such series, and determine or change the
designation, relative rights, preferences, and limitations of any
series of preferred stock. The board of may increase or decrease
the number of shares initially fixed for any series, but no
decrease may reduce the number below the shares then outstanding
and duly reserved for issuance. As of May 21, 2021, 5,194.81 shares
were designated as Series B Preferred Stock, of which 893.52 were
issued and outstanding, and 75,000 were designated as Series C
Preferred Stock, of which none were issued and outstanding. This
leaves 9,919,805.19 shares of preferred stock authorized but
undesignated.
If we
offer a specific series of preferred stock under this prospectus,
we will describe the terms of the preferred stock in the prospectus
supplement for such offering and will file a copy of the
certificate establishing the terms of the preferred stock with the
SEC. To the extent required, this description will
include:
●
the
title and stated value;
●
the
number of shares offered, the liquidation preference per share and
the purchase price;
●
the
dividend rate(s), period(s) and/or payment date(s), or method(s) of
calculation for such dividends;
●
whether
dividends will be cumulative or non-cumulative and, if cumulative,
the date from which dividends will accumulate;
●
the
procedures for any auction and remarketing, if any;
●
the
provisions for a sinking fund, if any;
●
the
provisions for redemption, if applicable;
●
any
listing of the preferred stock on any securities exchange or
market;
●
whether
the preferred stock will be convertible into our common stock, and,
if applicable, the conversion price (or how it will be calculated)
and conversion period;
●
voting
rights, if any, of the preferred stock;
●
a
discussion of any material and/or special U.S. federal income tax
considerations applicable to the preferred stock;
●
the
relative ranking and preferences of the preferred stock as to
dividend rights and rights upon liquidation, dissolution or winding
up of our affairs; and
●
any
material limitations on issuance of any class or series of
preferred stock ranking senior to or on a parity with the series of
preferred stock as to dividend rights and rights upon liquidation,
dissolution or winding up of our affairs.
Series B Preferred Stock
Under the Certificate
of Designations for the Series B Preferred Stock (the
“Series
B Certificate of Designations”), each share of
Series B Preferred Stock will be convertible, at the holder’s
option at any time, into our common stock at a conversion rate
equal to the quotient of (i) the $7,700 stated value (the
“Series
B Stated Value”) divided by
(ii) the initial conversion price of $0.77, subject to specified
adjustments for stock splits, cash or stock dividends,
reorganizations, reclassifications other similar events as set
forth in the Series B Certificate of Designations. In
addition, if at any time after January 16, 2021, the six month
anniversary of the date of the closing of our private placement
transaction on July 16, 2020, the closing sale price per share of
our common stock exceeds 250% of the initial conversion price, or
$1.925, for 20 consecutive trading days, then all of the
outstanding shares of Series B Preferred Stock will automatically
convert (the “Automatic Conversion”) into such number
of shares of our common stock as is obtained by multiplying the
number of shares of Series B Preferred Stock to be so converted,
plus the amount of any accrued and unpaid dividends thereon, by the
Series B Stated Value per share and dividing the result by the then
applicable conversion price.
The Series B Preferred Stock contains limitations that prevent the
holder thereof from acquiring shares of our common stock upon
conversion (including pursuant to the Automatic Conversion) that
would result in the number of shares beneficially owned by such
holder and its affiliates exceeding 9.99% of the total number of
shares of our common stock outstanding immediately after giving
effect to the conversion, which percentage may be increased or
decreased at the holder’s election not to
exceed 19.99%.
Each holder of shares
of Series B Preferred Stock, in preference and priority to the
holders of all other classes or series of our stock, is entitled to
receive dividends, commencing from the date of issuance. Such
dividends may be paid by us only when, as and if declared by our
board of directors, out of assets legally available therefore,
semiannually in arrears on the last day of June and December in
each year, commencing December 31, 2020, at the dividend rate of
9.0% per year, which is cumulative and continues to accrue on a
daily basis whether or not declared and whether or not we have
assets legally available therefore. We may pay such dividends at
our sole option either in cash or in kind in additional shares of
Series B Preferred Stock (rounded down to the nearest whole share),
provided we must pay in cash the fair value of any such fractional
shares in excess of $100.00. Under the Series B Certificate of
Designations, to the extent that applicable law or any of our
existing contractual restrictions prohibit any required issuance of
additional shares of Series B Preferred Stock as in-kind dividends
or otherwise (“Additional
Shares”), then
appropriate adjustment to the conversion price of the Series B
Preferred Stock shall be made so that the resulting number of
conversion shares includes the aggregate number of shares of our
common stock into which such Additional Shares would otherwise be
convertible.
Under the Series B
Certificate of Designations, each share of Series B Preferred Stock
carries a liquidation preference equal to the Series B Stated Value
(as adjusted thereunder) plus accrued and unpaid dividends thereon
(the “Series
B Liquidation Preference”).
In the event we effect
any issuance of common stock or common stock equivalents for cash
consideration, or a combination of units thereof (a
“Subsequent
Financing”), each holder
of the Series B Preferred Stock has the right, subject to certain
exceptions set forth in the Series B Certificate of Designations,
at its option, to exchange (in lieu of cash subscription payments)
all or some of the Series B Preferred Stock then held (with a value
per share of Series B Preferred Stock equal to the Series B
Liquidation Preference) for any securities or units issued in a
Subsequent Financing on dollar-for-dollar basis. As a result, we
may currently be required to issue additional shares of Series C
Preferred Stock to any holders of Series B Preferred Stock who
elect to exercise this right. Any shares of Series C Preferred
Stock to be issued pursuant to this right would, upon issuance, be
immediately converted into underlying shares of our common
stock.
The holders of the Series B Preferred Stock, voting as a separate
class, will have customary consent rights with respect to certain
corporate actions by us. We may not take the following actions
without the prior consent of the holders of at least a majority of
the Series B Preferred Stock then outstanding: (a) authorize,
create, designate, establish, issue or sell an increased number of
shares of Series B Preferred Stock or any other class or series of
capital stock ranking senior to or on parity with the Series B
Preferred Stock as to dividends or upon liquidation; (b) reclassify
any shares of common stock or any other class or series of capital
stock into shares having any preference or priority as to dividends
or upon liquidation superior to or on parity with any such
preference or priority of Series B Preferred Stock; (c) amend,
alter or repeal our Charter or Bylaws and the powers, preferences,
privileges, relative, participating, optional and other special
rights and qualifications, limitations and restrictions thereof,
which would adversely affect any right, preference, privilege or
voting power of the Series B Preferred Stock; (d) issue any
indebtedness or debt security, other than trade accounts payable,
insurance premium financings and/or letters of credit, performance
bonds or other similar credit support incurred in the ordinary
course of business, or amend, renew, increase, or otherwise alter
in any material respect the terms of any such indebtedness existing
as of the date of first issuance of shares of Series B Preferred
Stock; (e) redeem, purchase, or otherwise acquire or pay or declare
any dividend or other distribution on (or pay into or set aside for
a sinking fund for any such purpose) any of our capital stock; (f)
declare bankruptcy, dissolve, liquidate, or wind up our affairs;
(g) effect, or enter into any agreement to effect, a Change of
Control (as defined in the Series B Certificate of Designations);
or (h) materially modify or change the nature of our
business.
Series C Preferred Stock
Under the Certificate
of Designations for the Series C Preferred Stock (the
“Series
C Certificate of Designations”), each share of
Series C Preferred Stock will be convertible, at either the
holder’s option or at our option at any time, into common
stock at a conversion rate equal to the quotient of (i) the Series
C Stated Value of $750 plus all accrued and accumulated and unpaid
dividends on such share of Series C Preferred Stock divided by (ii)
the initial conversion price of $0.75, subject to specified
adjustments for stock splits, cash or stock dividends,
reorganizations, reclassifications other similar events as set
forth in the Series C Certificate of
Designations.
The
Series C Preferred Stock contains limitations that prevent the
holders thereof from acquiring shares of our common stock upon
conversion that would result in the number of shares beneficially
owned by any such holder and its affiliates exceeding 9.99% of the
total number of shares of our common stock outstanding immediately
after giving effect to the conversion. As a result, the Series C
Certificate of Designations provides for the issuance of pre-funded
warrants to purchase shares of our common stock, with an exercise
price of $0.001 per share and with no expiration date, if necessary
to comply with this limitation.
Each
holder of shares of Series C Preferred Stock, subject to the
preference and priority to the holders of our Series B Preferred
Stock, is entitled to receive dividends, commencing from the date
of issuance of the Series C Preferred Stock. Such dividends may be
paid only when, as and if declared by our board of directors, out
of assets legally available therefore, quarterly in arrears on the
last day of March, June, September and December in each year,
commencing on the date of issuance, at the dividend rate of 9.0%
per year. Such dividends are cumulative and continue to accrue on a
daily basis whether or not declared and whether or not we have
assets legally available therefore.
Under
the Series C Certificate of Designations, each share of Series C
Preferred Stock carries a liquidation preference equal to the
Series C Stated Value plus accrued and unpaid dividends thereon and
any other fees or liquidated damages then due and owing
thereon.
The holders of the Series C Preferred Stock have
no voting rights. We may not take the following actions without the
prior consent of the holders of at least a majority of the Series C
Preferred Stock then outstanding: (a) alter or change adversely the
powers, preferences or rights given to the Series C Preferred Stock
or alter or amend the Series C Certificate of Designations, (b)
authorize or create any class of stock ranking as to dividends,
redemption or distribution of assets upon a Liquidation (as defined
in the Series C Certificate of Designations) senior to, or
otherwise pari passu with,
the Series C Preferred Stock, (c) amend our Charter or other
charter documents in any manner that adversely affects any rights
of the holders of the Series C Preferred Stock, (d) increase the
number of authorized shares of Series C Preferred Stock, or (e)
enter into any agreement with respect to any of the
foregoing.
Transfer Agent and Registrar for Preferred Stock
The
transfer agent and registrar for any series or class of preferred
stock will be set forth in each applicable prospectus
supplement.
Anti-Takeover Effects of Certain Provisions of Delaware Law and of
Our Charter and Bylaws
Certain provisions of Delaware law, our Charter and Bylaws
discussed below may have the effect of making more difficult or
discouraging a tender offer, proxy contest or other takeover
attempt. These provisions are expected to encourage persons seeking
to acquire control of our company to first negotiate with our Board
of Directors. We believe that the benefits of increasing our
ability to negotiate with the proponent of an unfriendly or
unsolicited proposal to acquire or restructure our company outweigh
the disadvantages of discouraging these proposals because
negotiation of these proposals could result in an improvement of
their terms.
Delaware Anti-Takeover Law.
We are subject to Section 203 of
the Delaware General Corporation Law (the
“DGCL”).
Section 203 generally prohibits a public Delaware corporation
from engaging in a “business combination” with an
“interested stockholder” for a period of three years
after the date of the transaction in which the person became an
interested stockholder, unless:
●
prior to the date of the transaction, the Board of Directors of the
corporation approved either the business combination or the
transaction which resulted in the stockholder becoming an
interested stockholder;
●
upon consummation of the transaction that resulted in the
stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced,
excluding specified shares; or
●
at or subsequent to the date of the transaction, the business
combination is approved by the Board of Directors and authorized at
an annual or special meeting of stockholders, and not by written
consent, by the affirmative vote of at least 66 2/3% of the
outstanding voting stock which is not owned by the interested
stockholder.
Section 203 defines a “business combination” to
include:
●
any merger or consolidation involving the corporation and the
interested stockholder;
●
any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of 10% or more of the assets of the corporation to or
with the interested stockholder;
●
subject to exceptions, any transaction that results in the issuance
or transfer by the corporation of any stock of the corporation to
the interested stockholder;
●
subject to exceptions, any transaction involving the corporation
that has the effect of increasing the proportionate share of the
stock of any class or series of the corporation beneficially owned
by the interested stockholder; or
●
the receipt by the interested stockholder of the benefit of any
loans, advances, guarantees, pledges or other financial benefits
provided by or through the corporation.
In
general, Section 203 defines an “interested
stockholder” as any person that is:
●
the owner of 15% or more of the outstanding voting stock of the
corporation;
●
an affiliate or associate of the corporation who was the owner of
15% or more of the outstanding voting stock of the corporation at
any time within three years immediately prior to the relevant date;
or
●
the affiliates and associates of the above.
Under specific circumstances, Section 203 makes it more
difficult for an “interested stockholder” to effect
various business combinations with a corporation for a three-year
period, although the stockholders may, by adopting an amendment to
the corporation’s certificate of incorporation or bylaws,
elect not to be governed by this section, effective 12 months after
adoption.
Our Charter and Bylaws do not exclude us from the restrictions of
Section 203. We anticipate that the provisions of
Section 203 might encourage companies interested in acquiring
us to negotiate in advance with our Board of Directors since the
stockholder approval requirement would be avoided if a majority of
the directors then in office approve either the business
combination or the transaction that resulted in the stockholder
becoming an interested stockholder.
Charter and Bylaws.
Provisions of our Charter and Bylaws may delay or discourage
transactions involving an actual or potential change of control or
change in our management, including transactions in which
stockholders might otherwise receive a premium for their shares, or
transactions that our stockholders might otherwise deem to be in
their best interests. Therefore, these provisions could adversely
affect the price of our common stock.
Stockholder Action by Written Consent
Our
Bylaws provide that our stockholders may take action by written
consent or electronic transmission, setting forth the action so
taken, signed or e-mailed by the holders of outstanding stock
having not less than the minimum number of votes that would be
necessary to authorize or take such action at a meeting for such
purpose.
Potential Effects of Authorized but Unissued Stock
We have
shares of common stock and preferred stock available for future
issuance without stockholder approval. We may utilize these
additional shares for a variety of corporate purposes, including
future public offerings to raise additional capital, to facilitate
corporate acquisitions or payment as a dividend on the capital
stock.
The
existence of unissued and unreserved common stock and preferred
stock may enable our board of directors to issue shares to persons
friendly to current management or to issue preferred stock with
terms that could render more difficult or discourage a third-party
attempt to obtain control of us by means of a merger, tender offer,
proxy contest or otherwise, thereby protecting the continuity of
our management. In addition, the board of directors has the
discretion to determine designations, rights, preferences,
privileges and restrictions, including voting rights, dividend
rights, conversion rights, redemption privileges and liquidation
preferences of each series of preferred stock, all to the fullest
extent permissible under the DGCL and subject to any limitations
set forth in our Charter. The purpose of authorizing the board of
directors to issue preferred stock and to determine the rights and
preferences applicable to such preferred stock is to eliminate
delays associated with a stockholder vote on specific issuances.
The issuance of preferred stock, while providing desirable
flexibility in connection with possible financings, acquisitions
and other corporate purposes, could have the effect of making it
more difficult for a third party to acquire, or could discourage a
third party from acquiring, a majority of our outstanding voting
stock.
DESCRIPTION OF WARRANTS
We
summarize below some of the provisions that will apply to the
warrants unless the applicable prospectus supplement provides
otherwise. This summary may not contain all information that is
important to you. The complete terms of the warrants will be
contained in the applicable warrant certificate and warrant
agreement. These documents have been or will be included or
incorporated by reference as exhibits to the registration statement
of which this prospectus is a part. You should read the warrant
certificate and the warrant agreement. You should also read the
prospectus supplement, which will contain additional information
and which may update or change some of the information
below.
General
We may
issue, together with common or preferred stock as units or
separately, warrants for the purchase of shares of our common or
preferred stock. The terms of each warrant will be discussed in the
applicable prospectus supplement relating to the particular series
of warrants. The form(s) of certificate representing the warrants
and/or the warrant agreement will be, in each case, filed with the
SEC as an exhibit to a document incorporated by reference in the
registration statement of which this prospectus is a part on or
prior to the date of any prospectus supplement relating to an
offering of the particular warrant. The following summary of
material provisions of the warrants and the warrant agreements are
subject to, and qualified in their entirety by reference to, all
the provisions of the warrant agreement and warrant certificate
applicable to a particular series of warrants.
The
prospectus supplement relating to any series of warrants that are
offered by this prospectus will describe, among other things, the
following terms to the extent they are applicable to that series of
warrants:
●
the
procedures and conditions relating to the exercise of the
warrants;
●
the
number of shares of our common or preferred stock, if any, issued
with the warrants;
●
the
date, if any, on and after which the warrants and any related
shares of our common or preferred stock will be separately
transferable;
●
the
offering price of the warrants, if any;
●
the
number of shares of our common or preferred stock which may be
purchased upon exercise of the warrants and the price or prices at
which the shares may be purchased upon exercise;
●
the
date on which the right to exercise the warrants will begin and the
date on which the right will expire;
●
a
discussion of the material United States federal income tax
considerations applicable to the exercise of the
warrants;
●
anti-dilution
provisions of the warrants, if any;
●
call
provisions of the warrants, if any; and
●
any
other material terms of the warrants.
Each
warrant may entitle the holder to purchase for cash, or, in limited
circumstances, by effecting a cashless exercise for, the number of
shares of our common or preferred stock at the exercise price that
is described in the applicable prospectus supplement. Warrants will
be exercisable during the period of time described in the
applicable prospectus supplement. After that period, unexercised
warrants will be void. Warrants may be exercised in the manner
described in the applicable prospectus supplement.
A
holder of a warrant will not have any of the rights of a holder of
our common or preferred stock before the stock is purchased upon
exercise of the warrant. Therefore, before a warrant is exercised,
the holder of the warrant will not be entitled to receive any
dividend payments or exercise any voting or other rights associated
with shares of our common or preferred stock which may be purchased
when the warrant is exercised.
Transfer Agent and Registrar
The
transfer agent and registrar, if any, for any warrants will be set
forth in the applicable prospectus supplement.
DESCRIPTION OF SUBSCRIPTION RIGHTS
We may
issue subscription rights to purchase our common stock. These
subscription rights may be offered independently or together with
any other security offered hereby and may or may not be
transferable by the stockholder receiving the subscription rights
in such offering. In connection with any offering of subscription
rights, we may enter into a standby arrangement with one or more
underwriters or other purchasers pursuant to which the underwriters
or other purchasers may be required to purchase any securities
remaining unsubscribed for after such offering.
The
prospectus supplement relating to any subscription rights we offer,
if any, will, to the extent applicable, include specific terms
relating to the offering, including some or all of the
following:
●
the
price, if any, for the subscription rights;
●
the
exercise price payable for our common stock upon the exercise of
the subscription rights;
●
the
number of subscription rights to be issued to each
stockholder;
●
the
number and terms of our common stock which may be purchased per
each subscription right;
●
the
extent to which the subscription rights are
transferable;
●
any
other terms of the subscription rights, including the terms,
procedures and limitations relating to the exchange and exercise of
the subscription rights;
●
the
date on which the right to exercise the subscription rights shall
commence, and the date on which the subscription rights shall
expire;
●
the
extent to which the subscription rights may include an
over-subscription privilege with respect to unsubscribed securities
or an over-allotment privilege to the extent the securities are
fully subscribed; and
●
if
applicable, the material terms of any standby underwriting or
purchase arrangement which may be entered into by us in connection
with the offering of subscription rights.
DESCRIPTION OF UNITS
We may
issue units comprised of one or more of the other securities
described in this prospectus in any combination. Each unit will be
issued so that the holder of the unit is also the holder of each
security included in the unit. Thus, the holder of a unit will have
the rights and obligations of a holder of each included security
(but, to the extent convertible securities are included in the
units, the holder of the units will be deemed the holder of the
convertible securities and not the holder of the underlying
securities). The unit agreement under which a unit is issued, if
any, may provide that the securities included in the unit may not
be held or transferred separately, at any time or at any time
before a specified date. The applicable prospectus supplement may
describe:
●
the
designation and terms of the units and of the securities comprising
the units, including whether and under what circumstances those
securities may be held or transferred separately;
●
any
provisions for the issuance, payment, settlement, transfer or
exchange of the units or of the securities comprising the
units;
●
the
terms of the unit agreement governing the units;
●
United
States federal income tax considerations relevant to the units;
and
●
whether
the units will be issued in fully registered global
form.
This
summary of certain general terms of units and any summary
description of units in the applicable prospectus supplement do not
purport to be complete and are qualified in their entirety by
reference to all provisions of the applicable unit agreement and,
if applicable, collateral arrangements and depositary arrangements
relating to such units. The forms of the unit agreements and other
documents relating to a particular issue of units will be filed
with the SEC each time we issue units, and you should read those
documents for provisions that may be important to you.
FORMS OF SECURITIES
To the
extent applicable, each warrant, subscription right and unit, will
be represented either by a certificate issued in definitive form to
a particular investor or by one or more global securities
representing the entire issuance of securities. Certificated
securities in definitive form and global securities will be issued
in registered form. Definitive securities name you or your nominee
as the owner of the security, and in order to transfer or exchange
these securities or to receive payments other than interest or
other interim payments, you or your nominee must physically deliver
the securities to the trustee, registrar, paying agent or other
agent, as applicable. Global securities name a depositary or its
nominee as the owner of warrants represented by these global
securities. The depositary maintains a computerized system that
will reflect each investor’s beneficial ownership of the
securities through an account maintained by the investor with its
broker/dealer, bank, trust company or other representative, as we
explain more fully below.
Global Securities
Registered Global Securities. We may
issue, to the extent applicable, warrants, subscription rights and
units, in the form of one or more fully registered global
securities that will be deposited with a depositary or its nominee
identified in the applicable prospectus supplement and registered
in the name of that depositary or nominee. In those cases, one or
more registered global securities will be issued in a denomination
or aggregate denominations equal to the portion of the aggregate
principal or face amount of the securities to be represented by
registered global securities. Unless and until it is exchanged in
whole for securities in definitive registered form, a registered
global security may not be transferred except as a whole by and
among the depositary for the registered global security, the
nominees of the depositary or any successors of the depositary or
those nominees.
If not
described below, any specific terms of the depositary arrangement
with respect to any securities to be represented by a registered
global security will be described in the prospectus supplement
relating to those securities. We anticipate that the following
provisions will apply to all depositary arrangements.
Ownership of
beneficial interests in a registered global security will be
limited to persons, called participants, that have accounts with
the depositary or persons that may hold interests through
participants. Upon the issuance of a registered global security,
the depositary will credit, on its book-entry registration and
transfer system, the participants’ accounts with the
respective principal or face amounts of the securities beneficially
owned by the participants. Any dealers, underwriters or agents
participating in the distribution of the securities will designate
the accounts to be credited. Ownership of beneficial interests in a
registered global security will be shown on, and the transfer of
ownership interests will be effected only through, records
maintained by the depositary, with respect to interests of
participants, and on the records of participants, with respect to
interests of persons holding through participants. The laws of some
states may require that some purchasers of securities take physical
delivery of these securities in definitive form. These laws may
impair your ability to own, transfer or pledge beneficial interests
in registered global securities.
So long
as the depositary, or its nominee, is the registered owner of a
registered global security, that depositary or its nominee, as the
case may be, will be considered the sole owner or holder of the
securities represented by the registered global security for all
purposes under the applicable indenture or warrant agreement.
Except as described below, owners of beneficial interests in a
registered global security will not be entitled to have the
securities represented by the registered global security registered
in their names, will not receive or be entitled to receive physical
delivery of the securities in definitive form and will not be
considered the owners or holders of the securities under the
applicable indenture or warrant agreement. Accordingly, each person
owning a beneficial interest in a registered global security must
rely on the procedures of the depositary for that registered global
security and, if that person is not a participant, on the
procedures of the participant through which the person owns its
interest, to exercise any rights of a holder under the applicable
indenture or warrant agreement. We understand that under existing
industry practices, if we request any action of holders or if an
owner of a beneficial interest in a registered global security
desires to give or take any action that a holder is entitled to
give or take under the applicable indenture or warrant agreement,
the depositary for the registered global security would authorize
the participants holding the relevant beneficial interests to give
or take that action, and the participants would authorize
beneficial owners owning through them to give or take that action
or would otherwise act upon the instructions of beneficial owners
holding through them.
Any
payments to holders with respect to warrants represented by a
registered global security registered in the name of a depositary
or its nominee will be made to the depositary or its nominee, as
the case may be, as the registered owner of the registered global
security. None of the Company, the trustees, the warrant agents or
any other agent of the Company, the trustees or the warrant agents
will have any responsibility or liability for any aspect of the
records relating to payments made on account of beneficial
ownership interests in the registered global security or for
maintaining, supervising or reviewing any records relating to those
beneficial ownership interests.
We
expect that the depositary for any of the securities represented by
a registered global security, upon receipt of any payment of
principal, premium, interest or other distribution of underlying
securities or other property to holders on that registered global
security, will immediately credit participants’ accounts in
amounts proportionate to their respective beneficial interests in
that registered global security as shown on the records of the
depositary. We also expect that payments by participants to owners
of beneficial interests in a registered global security held
through participants will be governed by standing customer
instructions and customary practices, as is now the case with the
securities held for the accounts of customers in bearer form or
registered in “street name,” and will be the
responsibility of those participants.
If the
depositary for any of these securities represented by a registered
global security is at any time unwilling or unable to continue as
depositary or ceases to be a clearing agency registered under the
Securities Exchange Act of 1934, as amended, or the Exchange Act,
and a successor depositary registered as a clearing agency under
the Exchange Act is not appointed by us within 90 days, we will
issue securities in definitive form in exchange for the registered
global security that had been held by the depositary. Any
securities issued in definitive form in exchange for a registered
global security will be registered in the name or names that the
depositary gives to the relevant trustee or warrant agent or other
relevant agent of ours or theirs. It is expected that the
depositary’s instructions will be based upon directions
received by the depositary from participants with respect to
ownership of beneficial interests in the registered global security
that had been held by the depositary.
PLAN OF DISTRIBUTION
Initial Offering and Sale of Securities
Unless
otherwise set forth in a prospectus supplement accompanying this
prospectus, we may sell the securities being offered hereby, from
time to time, by one or more of the following methods:
●
to or
through underwriting syndicates represented by managing
underwriters;
●
through
one or more underwriters without a syndicate for them to offer and
sell to the public;
●
through
dealers or agents; and
●
to
investors directly in negotiated sales or in competitively bid
transactions.
Offerings of
securities covered by this prospectus also may be made into an
existing trading market for those securities in transactions at
other than a fixed price, either:
●
on or
through the facilities of the Nasdaq Capital Market or any other
securities exchange or quotation or trading service on which those
securities may be listed, quoted, or traded at the time of sale;
and/or
●
to or
through a market maker other than on the securities exchanges or
quotation or trading services set forth above.
Those
at-the-market offerings, if any, will be conducted by underwriters
acting as principal or agent of the Company, who may also be
third-party sellers of securities as described above. The
prospectus supplement with respect to the offered securities will
set forth the terms of the offering of the offered securities,
including:
●
the
name or names of any underwriters, dealers or agents;
●
the
purchase price of the offered securities and the proceeds to us
from such sale;
●
any
underwriting discounts and commissions or agency fees and other
items constituting underwriters’ or agents’
compensation;
●
any
initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers;
●
any
securities exchange on which such offered securities may be listed;
and
●
any
underwriter, agent or dealer involved in the offer and sale of any
series of the securities.
The
distribution of the securities may be effected from time to time in
one or more transactions:
●
at
fixed prices, which may be changed;
●
at
market prices prevailing at the time of the sale;
●
at
varying prices determined at the time of sale; or
●
at
negotiated prices.
Each
prospectus supplement will set forth the manner and terms of an
offering of securities including:
●
whether
that offering is being made to underwriters, through agents or
directly to the public;
●
the
rules and procedures for any auction or bidding process, if
used;
●
the
securities’ purchase price or initial public offering price;
and
●
the
proceeds we anticipate from the sale of the securities, if
any.
In
addition, we may enter into derivative or hedging transactions with
third parties, or sell securities not covered by this prospectus to
third parties in privately negotiated transactions. The applicable
prospectus supplement may indicate, in connection with such a
transaction, that the third parties may sell securities covered by
and pursuant to this prospectus and an applicable prospectus
supplement. If so, the third party may use securities pledged by us
or borrowed from us or others to settle such sales and may use
securities received from us to close out any related short
positions. We may also loan or pledge securities covered by this
prospectus and an applicable prospectus supplement to third
parties, who may sell the loaned securities or, in an event of
default in the case of a pledge, sell the pledged securities
pursuant to this prospectus and the applicable prospectus
supplement.
Sales Through Underwriters
If
underwriters are used in the sale of some or all of the securities
covered by this prospectus, the underwriters will acquire the
securities for their own account. The underwriters may resell the
securities, either directly to the public or to securities dealers,
at various times in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices
determined at the time of sale. The obligations of the underwriters
to purchase the securities will be subject to certain conditions.
Unless indicated otherwise in a prospectus supplement, the
underwriters will be obligated to purchase all the securities of
the series offered if any of the securities are
purchased.
Any
initial public offering price and any concessions allowed or
reallowed to dealers may be changed intermittently.
Sales Through Agents
Unless
otherwise indicated in the applicable prospectus supplement, when
securities are sold through an agent, the designated agent will
agree, for the period of its appointment as agent, to use specified
efforts to sell the securities for our account and will receive
commissions from us as will be set forth in the applicable
prospectus supplement.
Securities bought
in accordance with a redemption or repayment under their terms also
may be offered and sold, if so indicated in the applicable
prospectus supplement, in connection with a remarketing by one or
more firms acting as principals for their own accounts or as agents
for us. Any remarketing firm will be identified and the terms of
its agreement, if any, with us and its compensation will be
described in the prospectus supplement. Remarketing firms may be
deemed to be underwriters in connection with the securities
remarketed by them.
If so
indicated in the applicable prospectus supplement, we may authorize
agents, underwriters or dealers to solicit offers by certain
specified institutions to purchase securities at a price set forth
in the prospectus supplement pursuant to delayed delivery contracts
providing for payment and delivery on a future date specified in
the prospectus supplement. These contracts will be subject only to
those conditions set forth in the applicable prospectus supplement,
and the prospectus supplement will set forth the commissions
payable for solicitation of these contracts.
Direct Sales
We may
also sell offered securities directly to institutional investors or
others. In this case, no underwriters or agents would be involved.
The terms of such sales will be described in the applicable
prospectus supplement.
General Information
Broker-dealers,
agents or underwriters may receive compensation in the form of
discounts, concessions or commissions from us and/or the purchasers
of securities for whom such broker-dealers, agents or underwriters
may act as agents or to whom they sell as principal, or both. This
compensation to a particular broker-dealer might be in excess of
customary commissions.
Underwriters,
dealers and agents that participate in any distribution of the
offered securities may be deemed “underwriters” within
the meaning of the Securities Act , so any discounts or commissions
they receive in connection with the distribution may be deemed to
be underwriting compensation. Those underwriters and agents may be
entitled, under their agreements with us, to indemnification by us
against certain civil liabilities, including liabilities under the
Securities Act, or to contribution by us to payments that they may
be required to make in respect of those civil liabilities. Certain
of those underwriters or agents may be customers of, engage in
transactions with, or perform services for, us or our affiliates in
the ordinary course of business. We will identify any underwriters
or agents, and describe their compensation, in a prospectus
supplement. Any institutional investors or others that purchase
offered securities directly, and then resell the securities, may be
deemed to be underwriters, and any discounts or commissions
received by them from us and any profit on the resale of the
securities by them may be deemed to be underwriting discounts and
commissions under the Securities Act.
We will
file a supplement to this prospectus, if required, pursuant to Rule
424(b) under the Securities Act, if we enter into any material
arrangement with a broker, dealer, agent or underwriter for the
sale of securities through a block trade, special offering,
exchange distribution or secondary distribution or a purchase by a
broker or dealer. Such prospectus supplement will
disclose:
●
the
name of any participating broker, dealer, agent or
underwriter;
●
the
number and type of securities involved;
●
the price at which
such securities were sold;
●
any
securities exchanges on which such securities may be
listed;
●
the
commissions paid, or discounts or concessions allowed, to any such
broker, dealer, agent or underwriter, where applicable;
and
●
other
facts material to the transaction.
In
order to facilitate the offering of certain securities under this
prospectus or an applicable prospectus supplement, certain persons
participating in the offering of those securities may engage in
transactions that stabilize, maintain or otherwise affect the price
of those securities during and after the offering of those
securities. Specifically, if the applicable prospectus supplement
permits, the underwriters of those securities may over-allot or
otherwise create a short position in those securities for their own
account by selling more of those securities than have been sold to
them by us and may elect to cover any such short position by
purchasing those securities in the open market.
In
addition, the underwriters may stabilize or maintain the price of
those securities by bidding for or purchasing those securities in
the open market and may impose penalty bids, under which selling
concessions allowed to syndicate members or other broker-dealers
participating in the offering are reclaimed if securities
previously distributed in the offering are repurchased in
connection with stabilization transactions or otherwise. The effect
of these transactions may be to stabilize or maintain the market
price of the securities at a level above that which might otherwise
prevail in the open market. The imposition of a penalty bid may
also affect the price of securities to the extent that it
discourages resales of the securities. No representation is made as
to the magnitude or effect of any such stabilization or other
transactions. Such transactions, if commenced, may be discontinued
at any time.
In
order to comply with the securities laws of certain states, if
applicable, the securities must be sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in
certain states the securities may not be sold unless they have been
registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is
available and is complied with.
Rule
15c6-1 under the Exchange Act generally requires that trades in the
secondary market settle in two business days, unless the parties to
any such trade expressly agree otherwise. Your prospectus
supplement may provide that the original issue date for your
securities may be more than two scheduled business days after the
trade date for your securities. Accordingly, in such a case, if you
wish to trade securities on any date prior to the second business
day before the original issue date for your securities, you will be
required, by virtue of the fact that your securities initially are
expected to settle in more than two scheduled business days after
the trade date for your securities, to make alternative settlement
arrangements to prevent a failed settlement.
This
prospectus, any applicable prospectus supplement and any applicable
pricing supplement in electronic format may be made available on
the Internet sites of, or through other online services maintained
by, us and/or one or more of the agents and/or dealers
participating in an offering of securities, or by their affiliates.
In those cases, prospective investors may be able to view offering
terms online and, depending upon the particular agent or dealer,
prospective investors may be allowed to place orders
online.
Other
than this prospectus, any applicable prospectus supplement and any
applicable pricing supplement in electronic format, the information
on our website or the website of any agent or dealer, and any
information contained in any other website maintained by any agent
or dealer:
●
is not
part of this prospectus, any applicable prospectus supplement or
any applicable pricing supplement or the registration statement of
which they form a part;
●
has not
been approved or endorsed by us or by any agent or dealer in its
capacity as an agent or dealer, except, in each case, with respect
to the respective website maintained by such entity;
and
●
should
not be relied upon by investors.
There
can be no assurance that we will sell all or any of the securities
offered by this prospectus.
This
prospectus may also be used in connection with any issuance of
common stock or preferred stock upon exercise of a warrant if such
issuance is not exempt from the registration requirements of the
Securities Act.
In
addition, we may issue the securities as a dividend or distribution
or in a subscription rights offering to our existing
securityholders. In some cases, we or dealers acting with us or on
our behalf may also purchase securities and reoffer them to the
public by one or more of the methods described above. This
prospectus may be used in connection with any offering of our
securities through any of these methods or other methods described
in the applicable prospectus supplement.
LEGAL MATTERS
Unless
otherwise indicated in the applicable prospectus supplement, the
validity of the securities offered hereby will be passed upon for
us by Lowenstein Sandler LLP, New York, New York. If the validity
of the securities offered hereby in connection with offerings made
pursuant to this prospectus are passed upon by counsel for the
underwriters, dealers or agents, if any, such counsel will be named
in the prospectus supplement relating to such
offering.
EXPERTS
The audited annual consolidated financial statements of AzurRx
BioPharma, Inc. incorporated by reference in this prospectus and
elsewhere in the registration statement have been incorporated by
reference in reliance upon the report of Mazars USA LLP,
independent registered public accounting firm, upon the authority
of said firm as experts in accounting and auditing. The 2020 and
2019 audited annual consolidated financial statements of AzurRx
BioPharma, Inc., as of and for the years ended December 31, 2020
and 2019, have been audited by Mazars USA LLP, independent
registered public accounting firm. The audit report dated March 31,
2021 for the 2020 audited annual consolidated financial statements
includes an explanatory paragraph which states that certain
circumstances raise substantial doubt about our ability to continue
as a going concern.
DISCLOSURE OF COMMISSION
POSITION
ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Section
145 of the DGCL provides that we may indemnify any person who was
or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal or investigative (other than an action by
us or in our right) by reason of the fact that he is or was our
director, officer, employee or agent, or is or was serving at our
request as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees), judgments,
fines and amounts paid in settlement actually and reasonably
incurred by him or her in connection with such action, suit or
proceeding if he acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to our best interests,
and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful.
Section 145 further provides that we similarly may indemnify any
such person serving in any such capacity who was or is a party or
is threatened to be made a party to any threatened, pending or
completed action or suit by is or in our right to procure judgment
in our favor, against expenses actually and reasonably incurred in
connection with the defense or settlement of such action or suit if
he or she acted in good faith and in a manner he reasonably
believed to be in or not opposed to our best interests and except
that no indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to
be liable to us unless and only to the extent that the Delaware
Court of Chancery or such other court in which such action or suit
was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
Our
Charter limits the liability of our directors to the fullest extent
permitted by Delaware law. In addition, we have entered into
indemnification agreements with certain of our directors and
officers whereby we have agreed to indemnify those directors and
officers to the fullest extent permitted by law, including
indemnification against expenses and liabilities incurred in legal
proceedings to which the director or officer was, or is threatened
to be made, a party by reason of the fact that such director or
officer is or was a director, officer, employee or agent of the
Company, provided that such director or officer acted in good faith
and in a manner that the director or officer reasonably believed to
be in, or not opposed to, the best interests of the
Company.
We have
director and officer liability insurance to cover liabilities our
directors and officers may incur in connection with their services
to us, including matters arising under the Securities Act. Our
Charter and Bylaws also provide that we will indemnify our
directors and officers who, by reason of the fact that he or she is
one of our officers or directors of our company, is involved in any
action, suit or proceeding, whether civil, criminal, administrative
or investigative, related to their board role with the
company.
Insofar
as indemnification for liabilities arising under the Securities Act
may be permitted to our directors, officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, we will, unless in the opinion of our counsel the
matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of
such issue.
WHERE YOU CAN FIND MORE
INFORMATION
We are
subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith file
annual, quarterly and current reports, proxy statements and other
information with the SEC. The SEC maintains a website that contains
reports, proxy and information statements and other information
regarding registrants that file electronically with the SEC. The
address of the SEC’s website is www.sec.gov.
We make
available free of charge on or through our website at
www.pioneerpowersolutions.com, our Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and
amendments to those reports filed or furnished pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended,
as soon as reasonably practicable after we electronically file such
material with or otherwise furnish it to the SEC.
We have
filed with the SEC a registration statement under the Securities
Act, relating to the offering of these securities. The registration
statement, including the attached exhibits, contains additional
relevant information about us and the securities. This prospectus
does not contain all of the information set forth in the
registration statement. You can obtain a copy of the registration
statement for free at www.sec.gov. The registration statement and
the documents referred to below under “Incorporation of
Certain Information By Reference” are also available on our
website, www.azurrx.com.
We have
not incorporated by reference into this prospectus the information
on our website, and you should not consider it to be a part of this
prospectus.
The following documents filed with the SEC are incorporated by
reference into this prospectus:
●
our Annual Report on Form 10-K for the year ended December 31,
2020, filed with the SEC on March 31, 2021;
●
our Quarterly Report on Form 10-Q for the period ended March 31,
2021, filed with the SEC on May 24, 2021;
●
our Current Report on Form 8-K, filed with the SEC on January 4,
2021 (as amended on January 13, 2021), January 5, 2021, January 8,
2021, February 16, 2021, February 25, 2021 and March 10, 2021
(other than any portion thereof deemed furnished and not
filed);
●
the description of our common stock which is registered under
Section 12 of the Exchange Act, in our registration statement on
Form 8-A, filed with the SEC on August 8, 2016, including any
amendment or reports filed for the purposes of updating this
description, including Exhibit 4.1 to our Annual Report on Form
10-K for the year ended December 31, 2020, filed with the SEC on
March 31, 2021.
We also incorporate by reference all documents we file pursuant to
Section 13(a), 13(c), 14 or 15 of the Exchange Act (other than any
portions of filings that are furnished rather than filed pursuant
to Items 2.02 and 7.01 of a Current Report on Form 8-K) after the
date of the initial registration statement of which this prospectus
is a part and prior to effectiveness of such registration
statement. All documents we file in the future pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of
this prospectus and prior to the termination of the offering are
also incorporated by reference and are an important part of this
prospectus.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this registration statement to the
extent that a statement contained herein or in any other
subsequently filed document which also is or deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part
of this registration statement.
$150,000,000
Common Stock
Preferred Stock
Warrants
Subscription Rights
Units
PROSPECTUS
,
2021
The information in this prospectus supplement is not complete and
may be changed. A registration statement relating to these
securities has been filed with the Securities and Exchange
Commission. These securities may not be sold until the registration
statement is declared effective. This prospectus supplement and the
accompanying prospectuses are not an offer to sell these securities
and are not soliciting an offer to buy these securities, nor shall
there be any sale of these securities in any state or other
jurisdiction where such offer, solicitation or sale is not
permitted or would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
Subject to completion, dated May 26, 2021
PROSPECTUS SUPPLEMENT
(To Prospectus
dated ,
2021)
AzurRx BioPharma, Inc.
Up to $50,000,000
Common Stock
We have
entered into an At The Market Offering Agreement, or the sales
agreement, with H.C. Wainwright & Co., LLC, or Wainwright,
dated May 26, 2021, relating to the sale of shares of our common
stock, par value $0.0001 per share, having an aggregate offering
price of up to $50,000,000 from time to time through Wainwright,
acting as sales agent or principal.
Sales
of our common stock, if any, under this prospectus supplement will
be made by any method permitted that is deemed an “at the
market” offering as defined in Rule 415 under the Securities
Act of 1933, as amended, or the Securities Act, including sales
made directly on or through the Nasdaq Capital Market or any other
existing trading market in the United States for our common stock,
sales made to or through a market maker other than on an exchange
or otherwise, directly to Wainwright as principal, in negotiated
transactions at market prices prevailing at the time of sale or at
prices related to such prevailing market prices and/or in any other
method permitted by law. If we and Wainwright agree on any method
of distribution other than sales of shares of our common stock on
or through the Nasdaq Capital Market or another existing trading
market in the United States at market prices, we will file a
further prospectus supplement providing all information about such
offering as required by Rule 424(b) under the Securities Act. Under
the sales agreement, Wainwright is not required to sell any
specific number or dollar amount of securities, but Wainwright will
act as our sales agent using commercially reasonable efforts
consistent with its normal trading and sales practices. There is no
arrangement for funds to be received in any escrow, trust or
similar arrangement.
Wainwright will be
entitled to compensation at a commission rate of 3.0% of the gross
sales price per share sold under the sales agreement. See
“Plan of Distribution” beginning on page S-10 for
additional information regarding the compensation to be paid to
Wainwright. In connection with the sale of the shares of common
stock on our behalf, Wainwright will be deemed to be an
“underwriter” within the meaning of the Securities Act,
and the compensation of Wainwright will be deemed to be
underwriting commissions or discounts. We have also agreed to
provide indemnification and contribution to Wainwright with respect
to certain liabilities, including liabilities under the Securities
Act.
We are an “emerging growth company” as defined in
Section 2(a) of the Securities Act, and we have elected to
comply with certain reduced public company reporting
requirements.
Our
common stock is listed on the Nasdaq Capital Market under the
symbol “AZRX.” On May 21, 2021, the last reported sale
price of our common stock on the Nasdaq Capital Market was $0.89
per share.
Investing in our securities involves a high degree of risk. See
“Risk Factors” beginning on page S-3 of this
prospectus supplement
and the documents incorporated by reference into this
prospectus supplement
for a discussion of the risks that you should consider in
connection with an investment in our
securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus supplement or the
accompanying prospectus is truthful or complete. Any representation
to the contrary is a criminal offense.
H.C. Wainwright & Co.
The date of this prospectus supplement
is
, 2021.
TABLE OF CONTENTS
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S-ii
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S-1
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S-2
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S-3
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S-5
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S-7
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S-8
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S-10
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S-11
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S-11
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S-11
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S-12
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ABOUT THIS PROSPECTUS
SUPPLEMENT
This
prospectus supplement and the accompanying prospectus are part of
registration statement on Form S-3 that we have filed with the
Securities and Exchange Commission, or the SEC, using a
“shelf” registration process. This prospectus
supplement and the accompanying prospectus relate to the offer by
us of shares of our common stock to certain investors. Under the
shelf registration process, we may offer shares of our common stock
having an aggregate offering price of up to $50,000,000 from time
to time under this prospectus supplement and the accompanying
prospectus at prices and on terms to be determined by market
conditions at the time of the offering.
We
provide information to you about this offering of shares of our
common stock in in two separate documents that are bound together:
(1) this sales agreement prospectus supplement, which describes the
specific details regarding this offering, and (2) the accompanying
prospectus, which provides general information, some of which may
not apply to this offering. Generally, when we refer to this
“prospectus,” we are referring to both documents
combined. If information in this sales agreement prospectus
supplement is inconsistent with the accompanying prospectus, you
should rely on this sales agreement prospectus supplement. In
addition, to the extent there is a conflict between the information
contained in this sales agreement prospectus supplement, on the one hand, and the
information contained in any document incorporated by reference
that was filed with the SEC before the date of this
prospectus supplement, on
the other hand, you should rely on the information in this sales
agreement prospectus supplement. If any statement in one
of these documents is inconsistent with a statement in another
document having a later date — for example, a document
incorporated by reference in this prospectus supplement — the statement in
the document having the later date modifies or supersedes the
earlier statement.
We have
not authorized anyone to provide you with information different
from or inconsistent with the information contained in or
incorporated by reference in this prospectus supplement. We take no
responsibility for, and can provide no assurance as to the
reliability of, any other information that others may give you. You
should assume that the information appearing in this
prospectus supplement and
the documents incorporated by reference in this
prospectus supplement is
accurate only as of the date of those respective documents,
regardless of the time of delivery of those respective documents.
Our business, financial condition, results of operations and
prospects may have changed since those dates. You should read this
prospectus supplement and
the documents incorporated by reference in this
prospectus supplement in
their entirety before making an investment decision. You should
also read and consider the information in the documents to which we
have referred you in the sections of this prospectus supplement entitled “Where You
Can Find More Information” and “Incorporation of
Certain Information by Reference.” These documents contain important
information that you should consider when making your investment
decision.
We are
offering to sell, and seeking offers to buy, shares of our common
stock only in jurisdictions where offers and sales are permitted.
The distribution of this prospectus supplement and the offering of our
common stock in certain jurisdictions may be restricted by law.
Persons outside the United States who come into possession of this
prospectus supplement must inform themselves about, and observe any
restrictions relating to, the offering of our common stock and the
distribution of this prospectus supplement outside the United
States. This prospectus supplement does not constitute, and
may not be used in connection with, an offer to sell, or a
solicitation of an offer to buy, any securities offered by this
prospectus supplement by
any person in any jurisdiction in which it is unlawful for such
person to make such an offer or solicitation.
All
references in this prospectus supplement to “AzurRx,”
the “Company,” “we,” “us,” or
“our” mean AzurRx BioPharma, Inc. and its subsidiaries
unless we state otherwise, or the context otherwise indicates. This
prospectus supplement and
the information incorporated herein by reference contain references
to trademarks, service marks and trade names owned by us or other
companies. Solely for convenience, trademarks, service marks and
trade names referred to in this prospectus supplement and the information
incorporated herein, including logos, artwork, and other visual
displays, may appear without the ® or ™
symbols, but such references are not intended to indicate, in any
way, that we will not assert, to the fullest extent under
applicable law, our rights or the rights of the applicable licensor
to these trademarks, service marks and trade names. We do not
intend our use or display of other companies’ trade names,
service marks or trademarks to imply a relationship with, or
endorsement or sponsorship of us by, any other companies. Other
trademarks, trade names and service marks appearing in this
prospectus supplement are
the property of their respective owners.
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PROSPECTUS SUPPLEMENT
SUMMARY
This
summary highlights information contained elsewhere in this
prospectus supplement
and in the accompanying prospectus. This summary does not contain
all of the information that you should consider before deciding to
invest in our securities. You should read this entire
prospectus supplement
and the accompanying prospectus carefully, including the
“Risk Factors” section in this prospectus supplement,
the accompanying prospectus and under similar captions in the
documents incorporated by reference into this
prospectus supplement
and the accompanying prospectus. In this
prospectus supplement,
unless otherwise stated or the context otherwise requires,
references to “AzurRx”, “Company”,
“we”, “us”, “our” or similar
references mean AzurRx BioPharma, Inc. and its subsidiaries on a
consolidated basis. References to “AzurRx BioPharma”
refer to AzurRx BioPharma, Inc. on an unconsolidated basis.
References to “AzurRx SAS” refer to AzurRx SAS, AzurRx
BioPharma’s wholly-owned subsidiary through which we conduct
our European operations.
Overview
We are engaged in the research and development of
targeted, non-systemic therapies for the treatment of patients with
gastrointestinal (“GI”) diseases. Non-systemic therapies are
non-absorbable drugs that act locally, i.e. in the intestinal
lumen, skin or mucosa, without reaching an individual’s
systemic circulation. We are focused on
developing our pipeline of gut-restricted GI clinical drug
candidates, including MS1819 and niclosamide.
Our lead drug candidate
is MS1819, a recombinant lipase for the treatment of exocrine
pancreatic insufficiency (“EPI”)
in patients with cystic
fibrosis (“CF”) and chronic pancreatitis
(“CP”), currently in two
Phase 2 CF clinical trials. In March 2021, we announced topline results from
our Phase 2b OPTION 2 monotherapy trial, and in May 2021, we
announced positive interim results from the first 18 patients in
our Phase 2 Combination trial in Europe.
In 2021, we intend to
launch two new clinical programs using proprietary formulations of
niclosamide, a small molecule
with anti-helminthic, anti-viral and anti-inflammatory
properties; FW-1022, for
Severe Acute Respiratory Syndrome Coronavirus 2
(“COVID-19”)
gastrointestinal infections, and FW-420, for Grade 1 and Grade 2
Immune Checkpoint Inhibitor-Associated Colitis
(“ICI-AC”)
and diarrhea in advanced stage oncology patients.
We initiated our Phase 2 RESERVOIR
clinical trial using a proprietary oral immediate-release tablet
formulation of micronized niclosamide (FW-1022) for the treatment
of COVID-19 related GI infections in April 2021, and we are
preparing to initiate our Phase 1b/2a PASSPORT ICI-AC trial using
both an oral immediate-release tablet and a topical rectal enema
foam formulations of niclosamide (FW-420) in the first half of
2021.
Corporate Information
We were incorporated on
January 30, 2014 in the State of Delaware. In June 2014,
we acquired 100% of the issued and outstanding capital stock of
AzurRx SAS. Our principal executive offices are located at
1615 South Congress Avenue, Suite 103, Delray Beach, Florida 33445.
Our telephone number is (646) 699-7855. We maintain a website at
www.azurrx.com. The information contained on our website is not,
and should not be interpreted to be, a part of this
prospectus supplement or the
accompanying prospectus.
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THE OFFERING
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Common
stock offered by us
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Shares
of our common stock having an aggregate offering price of up to
$50,000,000.
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Common
stock to be outstanding after the offering
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Up to 134,754,906 shares, assuming a sales price of $0.89 per
share, which was the closing price of our common stock on the
Nasdaq Capital Market on May 21, 2021. The actual number of shares
issued will vary depending on the sales price at which shares may
be sold from time to time during this offering.
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Plan of
Distribution
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“At
the market offering” as defined in Rule 415(a)(4) under the
Securities Act, that may be made from time to time on the Nasdaq
Capital Market, the existing trading market for our common stock,
through Wainwright, as agent or principal. See section titled
“Plan of Distribution” on page S-10 of this prospectus
supplement.
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Use of
proceeds
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We
intend to use the net proceeds from this offering for general
corporate purposes, which may include funding research, development
and product manufacturing, clinical trials, acquisitions or
investments in businesses, products or technologies that are
complementary to our own, increasing our working capital, reducing
indebtedness, and capital expenditures. Please see “Use of
Proceeds” on page S-7.
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Risk
factors
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Investing
in our common stock involves a high degree of risk. See “Risk
Factors” beginning on page S-3 of this prospectus supplement and under similar
headings in the other documents that are filed after the date
hereof and incorporated by reference in this prospectus supplement for a discussion of
factors to consider before deciding to purchase shares of our
common stock.
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Nasdaq
Capital Market symbol
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AZRX
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The
above discussion is based on 78,575,131 shares of our common stock
outstanding as of May 21, 2021 and excludes as of such
date:
●
3,915,506
shares of common stock issuable upon exercise of stock options,
with a weighted average exercise price of $1.20 per share, under
our Amended and Restated 2014 Omnibus Equity Incentive Plan (the
“2014 Plan”);
●
387,000
shares of awarded but unissued restricted stock and restricted
stock units under our 2014 Plan;
●
389,685
shares of common stock issuable upon exercise of stock options,
with a weighted average exercise price of $0.99 per share, under
our Amended and Restated 2020 Omnibus Equity Incentive Plan (the
“2020 Plan”);
●
9,610,315
shares of common stock available for future issuance under our 2020
Plan;
●
52,484,255
shares of common stock issuable upon exercise of outstanding
warrants, with a weighted average exercise price of $1.03 per
share;
●
9,243,620 shares of common stock issuable upon conversion of 893.52
shares of Series B Preferred Stock, including accrued and unpaid
dividends thereon of approximately $238,000;
●
246,539
shares of common stock issuable upon conversion of Series C
Preferred Stock that may be issued pursuant to an exchange right,
in excess of amounts currently underlying Series B Preferred Stock;
and
●
9,490,159
shares of common stock issuable upon exercise of warrants that may
be issued pursuant to an exchange right.
RISK FACTORS
An investment in our common stock involves a
high degree of risk. Before deciding whether to invest in our
common stock, you should carefully consider the risks and
uncertainties described below, together with the information under
the heading “Risk Factors” in our most recent Annual
Report on Form 10-K for the fiscal year ended December 31, 2020 and
our most recent Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 2021, all of which are incorporated herein
by reference, as updated or superseded by the risks and
uncertainties described under similar headings in the other
documents that are filed after the date hereof and incorporated by
reference into this prospectus supplement and the accompanying prospectus,
together with all of the other information contained or
incorporated by reference in this prospectus supplement and the accompanying prospectus,
and any free writing prospectus that we have authorized for use in
connection with this offering before you make a decision to invest
in our common stock.. The risks and uncertainties we have described
are not the only ones we face. Additional risks and uncertainties
not presently known to us or that we currently deem immaterial may
also affect our operations. Past financial performance may not be a
reliable indicator of future performance, and historical trends
should not be used to anticipate results or trends in future
periods. If any of these risks actually occurs, our business,
business prospects, financial condition or results of operations
could be seriously harmed. This could cause the trading price of
our common stock to decline, resulting in a loss of all or part of
your investment. Please also read carefully the section below
entitled “Cautionary Note Regarding Forward-Looking
Statements.”
Risks Related to this Offering
We will have broad discretion in how we use the net proceeds of
this offering. We may not use these proceeds effectively, which
could affect our results of operations and cause our stock price to
decline.
We will
have considerable discretion in the application of the net proceeds
of this offering, including for any of the purposes described in
the section titled “Use of Proceeds.” We intend to use
the net proceeds received by us from this offering for general
corporate purposes, which may include funding research, development
and product manufacturing, clinical trials, acquisitions or
investments in businesses, products or technologies that are
complementary to our own, increasing our working capital, reducing
indebtedness, and capital expenditures. We may use the net proceeds
for purposes that do not yield a significant return or any return
at all for our stockholders. In addition, pending their use, we may
invest the net proceeds from this offering in a manner that does
not produce income or that loses value.
Resales of our common stock in the public market during this
offering by our stockholders may cause the market price of our
common stock to fall.
We may
issue shares of common stock from time to time in connection with
this offering. The issuance from time to time of these new shares
of common stock, or our ability to issue new shares of common stock
in this offering, could result in resales of our shares of common
stock by our current stockholders concerned about the potential
dilution of their holdings. In turn, these resales could have the
effect of depressing the market price for our common
stock.
Purchasers in this offering will likely experience immediate and
substantial dilution in the book value of their
investment.
The
shares of common stock sold in this offering, if any, will be sold
from time to time at various prices. However, the expected offering
price per share of common stock may be substantially higher than
the net tangible book value per share of common stock. Therefore,
if you purchase shares of our common stock in this offering, your
interest will be diluted to the extent of the difference between
the price per share you pay and the net tangible book value per
share of common stock. Assuming that the sale of an aggregate
amount of $50,000,000 of shares of our common stock in this
offering at an assumed offering price of $0.89 per share, which was
the last reported sale price of our common stock on the Nasdaq
Capital Market on May 21, 2021, and based on our net tangible book
value as of March 31, 2021, if you purchase shares of common stock
in this offering you will suffer substantial and immediate dilution
of $0.45 per share in the net tangible book value of the share
common stock. The future exercise of outstanding options or
warrants and other instruments that are convertible or exercisable
into common stock, if any, will result in further dilution of your
investment. See the section entitled “Dilution” below
for a more detailed discussion of the dilution you will incur if
you purchase shares of our common stock in this
offering.
Sales of a substantial number of shares of our common stock, or the
perception that such sales may occur, may adversely impact the
price of our common stock.
Sales
of a substantial number of shares of our common stock in the public
markets could depress the market price of our common stock and
impair our ability to raise capital through the sale of additional
equity securities. We cannot predict the effect that future sales
of our common stock would have on the market price of our common
stock.
The common stock offered hereby will be sold in “at the
market” offerings, and investors who buy shares at different
times will likely pay different prices.
Investors who
purchase shares in this offering at different times will likely pay
different prices, and so may experience different outcomes in their
investment results. We will have discretion, subject to market
demand, to vary the timing, prices, and numbers of shares sold, and
there is no minimum or maximum sales price. Investors may
experience a decline in the value of their shares as a result of
share sales made at prices lower than the prices they
paid.
The actual number of shares we will issue under the sales
agreement, at any one time or in total, is uncertain.
Subject
to certain limitations in the sales agreement and compliance with
applicable law, we have the discretion to deliver placement notices
to Wainwright at any time throughout the term of the sales
agreement. The number of shares that are sold by Wainwright after
delivering a placement notice will fluctuate based on the market
price of the common stock during the sales period and limits we set
with Wainwright. Because the price per share of each share sold
will fluctuate based on the market price of our common stock during
the sales period, it is not possible at this stage to predict the
number of shares that will be ultimately issued.
You may experience future dilution as a result of future equity
offerings.
To
raise additional capital, we may in the future offer additional
shares of common stock or other securities convertible into or
exchangeable for our common stock at prices that may not be the
same as the price per share in this offering. We may sell common
stock or other securities in any other offering at a price per
share that is less than the price per share paid by investors in
this offering, and investors purchasing shares or other securities
in the future could have rights superior to existing stockholders.
The price per share at which we sell additional shares of common
stock, or securities convertible or exchangeable into common stock,
in future transactions may be higher or lower than the price per
share paid by investors in this offering.
CAUTIONARY NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus supplement,
the accompanying prospectus and any documents we incorporate by
reference, contain certain forward-looking statements that involve
substantial risks and uncertainties. All statements contained in
this prospectus supplement, the accompanying
prospectus and any documents we incorporate by reference, other
than statements of historical facts, are forward-looking statements
including statements regarding our strategy, future operations,
future financial position, future revenue, projected costs,
prospects, plans, objectives of management and expected market
growth. These statements involve known and unknown risks,
uncertainties and other important factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements.
The
words “anticipate”, “believe”,
“estimate”, “expect”, “intend”,
“may”, “plan”, “predict”,
“project”, “target”,
“potential”, “will”, “would”,
“could”, “should”, “continue”
and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. These forward-looking statements include,
among other things, statements about:
●
statements
regarding the impact of the COVID-19 pandemic and its effects on
our operations, access to capital, research and development and
clinical trials and potential disruption in the operations and
business of third-party vendors, contract research organizations
(“CROs”),
contract development and manufacturing organizations
(“CDMOs”),
other service providers, and collaborators with whom we conduct
business;
●
availability of
capital to satisfy our working capital requirements;
●
our
current and future capital requirements and our ability to raise
additional funds to satisfy our capital needs;
●
the
accuracy of our estimates regarding expense, future revenue and
capital requirements;
●
ability
to continue operating as a going concern;
●
our
plans to develop and commercialize our drug candidates, including
MS1819 and niclosamide;
●
our
ability to initiate and complete our clinical trials and to advance
our principal drug candidates into additional clinical trials,
including pivotal clinical trials, and successfully complete such
clinical trials;
●
regulatory
developments in the U.S. and foreign countries;
●
the
performance of our third-party vendor(s), CROs, CDMOs and other
third-party non-clinical and clinical development collaborators and
regulatory service providers;
●
our
ability to obtain and maintain intellectual property protection for
our core assets;
●
the
size of the potential markets for our product candidates and our
ability to serve those markets;
●
the
rate and degree of market acceptance of our product candidates for
any indication once approved;
●
the
success of competing products and product candidates in development
by others that are or become available for the indications that we
are pursuing;
●
the
loss of key scientific, clinical and nonclinical development,
and/or management personnel, internally or from one of our
third-party collaborators;
●
other
risks and uncertainties, including those listed in the
“Risk Factors”
section of this prospectus supplement, the accompanying
prospectus and the documents incorporated by reference herein;
and
●
our use
of proceeds from this offering.
These
forward-looking statements are only predictions and we may not
actually achieve the plans, intentions or expectations disclosed in
our forward-looking statements, so you should not place undue
reliance on our forward-looking statements. Actual results or
events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make.
We have based these forward-looking statements largely on our
current expectations and projections about future events and trends
that we believe may affect our business, financial condition and
operating results. We have included important factors in the
cautionary statements included in this prospectus supplement and the accompanying
prospectus, as well as certain information incorporated by
reference into this prospectus supplement and the accompanying
prospectus, that could cause actual future results or events to
differ materially from the forward-looking statements that we make.
Our forward-looking statements do not reflect the potential impact
of any future acquisitions, mergers, dispositions, joint ventures
or investments we may make.
Discussions
containing these forward-looking statements may be found, among
other places, in the sections titled “Business,”
“Risk Factors” and “Management’s Discussion
and Analysis of Financial Condition and Results of
Operations” incorporated by reference from our most recent
Annual Report on Form 10-K for the fiscal year ended December 31,
2020 and our most recent Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2021, as well as any amendments
thereto, filed with the SEC. Additional factors are discussed under
the caption “Risk Factors” in this prospectus
supplement, the accompanying prospectus and any free writing
prospectus and under similar headings in the other documents that
are incorporated by reference into this prospectus supplement. New
risks and uncertainties arise from time to time, and it is
impossible for us to predict these events or how they may affect
us. We disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by
law.
You
should read this prospectus supplement and the accompanying
prospectus with the understanding that our actual future results
may be materially different from what we expect. We do not assume
any obligation to update any forward-looking statements whether as
a result of new information, future events or otherwise, except as
required by applicable law.
USE OF
PROCEEDS
We may
issue and sell shares of common stock having aggregate sales
proceeds of up to $50,000,000 from time to time, before deducting
sales agent commissions and expenses. The amount of proceeds from
this offering will depend upon the number of shares of our common
stock sold and the market price at which they are sold. There can
be no assurance that we will be able to sell any shares under or
fully utilize the sales agreement with Wainwright.
We
currently intend to use the net proceeds from the sale of the
shares offered by us pursuant to this prospectus supplement for general corporate
purposes, which may include funding research, development and
product manufacturing, clinical trials, acquisitions or investments
in businesses, products or technologies that are complementary to
our own, increasing our working capital, reducing indebtedness, and
capital expenditures.
Investors are
cautioned, however, that expenditures may vary substantially from
these uses. Investors will be relying on the judgment of our
management, who will have broad discretion regarding the
application of the proceeds of this offering. The amounts and
timing of our actual expenditures may vary significantly depending
upon numerous factors, including the amount of cash generated by
our operations and other operational factors, the progress of our
development efforts, the status of and results from clinical
trials, as well as any collaborations that we may enter into with
third parties for our product candidates and any unforeseen cash
needs. We may find it necessary or advisable to use portions of the
proceeds from this offering for other purposes.
Pending
other uses, we intend to invest the proceeds to us in
investment-grade, interest-bearing securities such as money market
funds, certificates of deposit, or direct or guaranteed obligations
of the U.S. government, or hold as cash. We cannot predict whether
the proceeds invested will yield a favorable, or any,
return.
DILUTION
If you
invest in our common stock in this offering, your interest will be
diluted to the extent of the difference between the price per share
you pay in this offering and the net tangible book value per share
of common stock immediately after this offering. The net tangible
book value of our common stock as of March 31, 2021, was
approximately $9.7 million, or approximately $0.13 per share of
common stock based on 74,926,902 shares of common stock outstanding
at that time. “Net tangible book value” is total assets
minus the sum of liabilities and intangible assets. “Net
tangible book value per share” is net tangible book value
divided by the total number of shares outstanding.
After
giving effect to the sale of our common stock in the aggregate
amount of $50,000,000 in this offering at an assumed offering price
of $0.89 per share, the last reported sale price of our common
stock on the Nasdaq Capital Market on May 21, 2021, and after
deducting the commissions and estimated offering expenses payable
by us, our net tangible book value as of March 31, 2021, would have
been approximately $58.0 million, or approximately $0.44 per share
of our common stock. This represents an immediate increase in net
tangible book value of $0.31 per share to our existing stockholders
and an immediate dilution of approximately $0.45 per share to new
investors participating in this offering, as illustrated by the
following table:
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Assumed offering
price per share of common stock
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$0.89
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Net tangible book
value per share of common stock as of March 31, 2021
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$0.13
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Increase in net
tangible book value per share of common stock attributable to this
offering
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$0.31
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As adjusted net
tangible book value per share of common stock as of March 31, 2021
after giving effect to this offering
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$0.44
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Dilution in net
tangible book value per share of common stock to new investors in
the offering
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$0.45
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To the
extent that outstanding options or warrants are exercised, or our
convertible preferred stock is converted into common stock, you
will experience further dilution. In addition, we may choose to
offer securities in other offerings due to market conditions or
strategic considerations. To the extent that we raise additional
capital through the sale of common stock or securities exercisable
for or convertible into common stock, the issuance of such
securities may result in further dilution of our
stockholders.
The as
adjusted information is illustrative only and will adjust based on
the actual price to the public, the actual number of shares sold
and other terms of the offering determined at the time common stock
is sold pursuant to this prospectus supplement and the
accompanying prospectus. The as adjusted information assumes that
all of our common stock in the aggregate amount of $50,000,000 is
sold at the assumed offering price of $0.89 per share, the last
reported sale price of our common stock on the Nasdaq Capital
Market on May 21, 2021. The shares sold in this offering, if any,
will be sold from time to time at various prices.
A $0.50
increase or decrease in the assumed offering price of $0.89 per
share, based on the last reported sale price of our common stock on
the Nasdaq Capital Market on May 21, 2021, would increase or
decrease the as adjusted net tangible book value after this
offering by $0.08, or $(0.15) per share, and the dilution per share
to investors participating in this offering by $(0.08), or $0.15
per share, assuming that all of our common stock in the aggregate
amount of $50,000,000 is sold and after deducting sales agent fees
and estimated offering expenses payable by us.
We may
also sell less than $50,000,000 of shares of common stock. A
decrease of $5,000,000 in the amount of shares of common stock
offered by us, based on the assumed offering price of $0.89 per
share, the last reported sale price of our common stock on the
Nasdaq Capital Market on May 21, 2021, would decrease our as
adjusted net tangible book value per share by approximately $0.02
and increase the dilution per share to investors participating in
this offering by $0.02 after deducting sales agent fees and
estimated offering expenses payable by us.
The
discussion and table above are based on 74,926,902 shares of common
stock outstanding as of March 31, 2021, and excludes the following
securities as of that date:
●
3,924,770
shares of common stock issuable upon exercise of stock options,
with a weighted average exercise price of $1.20 per share, under
our Amended and Restated 2014 Omnibus Equity Incentive Plan (the
“2014 Plan”);
●
387,000
shares of awarded but unissued restricted stock and restricted
stock units under our 2014 Plan;
●
353,685
shares of common stock issuable upon exercise of stock options,
with a weighted average exercise price of $1.00 per share, under
our Amended and Restated 2020 Omnibus Equity Incentive Plan (the
“2020 Plan”);
●
9,646,315
shares of common stock available for future issuance under our 2020
Plan;
●
49,392,676
shares of common stock issuable upon exercise of outstanding
warrants, with a weighted average exercise price of $1.04 per
share;
●
12,360,554
shares of common stock issuable upon conversion of 1,209.52 shares
of Series B Preferred Stock, including in respect of accrued and
unpaid dividends of approximately $205,000;
●
329,608
shares of common stock issued upon conversion of Series C Preferred
Stock that was issued pursuant to an exchange right, in excess of
amounts currently underlying Series B Preferred Stock;
and
●
12,690,204
shares of common stock issuable upon exercise of warrants that may
be issued pursuant to an exchange right.
PLAN OF DISTRIBUTION
We have
entered into a sales agreement with Wainwright, pursuant to which
we may issue and sell from time to time shares of our common stock
having an aggregate offering price of not more than $50,000,000
through Wainwright as our sales agent. Sales of the common stock,
if any, will be made by any method permitted by law deemed to be an
“at the market offering” as defined in Rule 415
promulgated under the Securities Act. If we and Wainwright agree on
any method of distribution other than sales of shares of our common
stock on or through the Nasdaq Capital Market or another existing
trading market in the United States at market prices, we will file
a further prospectus supplement providing all information about
such offering as required by Rule 424(b) under the Securities
Act.
Wainwright will
offer our common stock at prevailing market prices subject to the
terms and conditions of the sales agreement as agreed upon by us
and Wainwright. We will designate the number of shares which we
desire to sell, the time period during which sales are requested to
be made, any limitation on the number of shares that may be sold in
one day and any minimum price below which sales may not be made.
Subject to the terms and conditions of the sales agreement,
Wainwright will use its commercially reasonable efforts consistent
with its normal trading and sales practices to sell on our behalf
all of the shares of common stock requested to be sold by us. We or
Wainwright may suspend the offering of the common stock being made
through Wainwright under the sales agreement upon proper notice to
the other party.
Settlement for
sales of common stock will occur on the second business day or such
shorter settlement cycle as may be in effect under Exchange Act
Rule 15c6-1 from time to time, following the date on which any
sales are made, or on some other date that is agreed upon by us and
Wainwright in connection with a particular transaction, in return
for payment of the net proceeds to us. Sales of our common stock as
contemplated in this prospectus supplement and the accompanying
prospectus will be settled through the facilities of The Depository
Trust Company or by such other means as we and Wainwright may agree
upon. There is no arrangement for funds to be received in an
escrow, trust or similar arrangement.
We will
pay Wainwright in cash, upon each sale of our shares of common
stock pursuant to the sales agreement, a commission of 3.0% of the
gross proceeds from each sale of shares of our common stock.
Because there is no minimum offering amount required as a condition
to this offering, the actual total public offering amount,
commissions and proceeds to us, if any, are not determinable at
this time. Pursuant to the terms of the sales agreement, we agreed
to reimburse Wainwright for the documented fees and costs of its
legal counsel reasonably incurred in connection with entering into
the transactions contemplated by the sales agreement in an amount
not to exceed $50,000 in the aggregate, in addition to up to $2,500
per due diligence update session for Wainwright’s
counsel’s fees and any incidental expenses to be reimbursed
by us. We will report at least quarterly the number of shares of
common stock sold through Wainwright under the sales agreement, the
net proceeds to us and the compensation paid by us to Wainwright in
connection with the sales of common stock.
In
connection with the sales of common stock on our behalf, Wainwright
will be deemed to be an “underwriter” within the
meaning of the Securities Act, and the compensation paid to
Wainwright will be deemed to be underwriting commissions or
discounts. We have agreed in the sales agreement to provide
indemnification and contribution to Wainwright against certain
liabilities, including liabilities under the Securities
Act.
The
offering of our shares of common stock pursuant to the sales
agreement will terminate upon the earlier of the sale of all of our
shares of common stock provided for in this prospectus supplement
or termination of the sales agreement as permitted
therein.
To the
extent required by Regulation M, Wainwright will not engage in
any market making activities involving our shares of common stock
while the offering is ongoing under this prospectus
supplement.
Wainwright and its
affiliates may in the future provide various investment banking and
other financial services for us and our affiliates, for which
services they may in the future receive customary
fees.
This
prospectus supplement and
the accompanying prospectus may be made available in electronic
format on a website maintained by Wainwright, and Wainwright may
distribute this prospectus and the accompanying prospectus
electronically.
LEGAL
MATTERS
The
validity of the securities offered hereby will be passed upon for
us by Lowenstein Sandler LLP, New York, New York. Haynes and Boone,
LLP, New York, New York, is counsel for Wainwright in connection
with this offering.
EXPERTS
The audited annual consolidated
financial statements of AzurRx BioPharma, Inc. incorporated by
reference in this prospectus supplement and elsewhere in the
registration statement have been incorporated by reference in
reliance upon the report of Mazars USA LLP, independent registered
public accounting firm, upon the authority of said firm as experts
in accounting and auditing. The 2020 and 2019 audited annual
consolidated financial statements of AzurRx BioPharma, Inc., as of
and for the years ended December 31, 2020 and 2019, have been
audited by Mazars USA LLP, independent registered public accounting
firm. The audit report dated March 31, 2021 for the 2020 audited
annual consolidated financial statements includes an explanatory
paragraph which states that certain circumstances raise substantial
doubt about our ability to continue as a going
concern.
WHERE YOU CAN FIND MORE INFORMATION
We are
subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith file
annual, quarterly and current reports, proxy statements and other
information with the Securities and Exchange Commission. The
Securities and Exchange Commission maintains a website that
contains reports, proxy and information statements and other
information regarding registrants that file electronically with the
Securities and Exchange Commission. The address of the Securities
and Exchange Commission’s website is
www.sec.gov.
We make
available free of charge on or through our website our Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q,
Current Reports on Form 8-K and amendments to those reports
filed or furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended, as soon as reasonably
practicable after we electronically file such material with or
otherwise furnish it to the Securities and Exchange
Commission.
We have
filed with the Securities and Exchange Commission a registration
statement under the Securities Act, relating to the offering of
these securities. The registration statement, including the
attached exhibits, contains additional relevant information about
us and the securities. This prospectus supplement and the
accompanying prospectus do not contain all of the information set
forth in the registration statement. You can obtain a copy of the
registration statement for free at www.sec.gov. The registration
statement and the documents referred to below under
“Incorporation of Certain Information By Reference” are
also available on our website, www.azurrx.com/investors/regulatory-filings.
We have
not incorporated by reference into this prospectus supplement or the accompanying
prospectus the information on our website, and you should not
consider it to be a part of this prospectus supplement or the accompanying
prospectus.
INCORPORATION OF CERTAIN
INFORMATION BY REFERENCE
The following documents filed with the
SEC are incorporated by reference into this
prospectus supplement:
●
our Annual Report on Form 10-K for the year ended December 31,
2020, filed with the SEC on March 31, 2021;
●
our Quarterly Report on Form 10-Q for the period ended March 31,
2021, filed with the SEC on May 24, 2021;
●
our Current Reports on Form 8-K, filed
with the SEC on January 4, 2021 (as amended on January 13, 2021),
January 5, 2021, January 8, 2021, February 16, 2021, February 25,
2021 and March 10, 2021 (other than any portion thereof deemed
furnished and not filed);
●
the description of our common stock which is registered under
Section 12 of the Exchange Act, in our registration statement on
Form 8-A, filed with the SEC on August 8, 2016, including any
amendment or reports filed for the purposes of updating this
description, including Exhibit 4.1 to our Annual Report on Form
10-K for the year ended December 31, 2020, filed with the SEC on
March 31, 2021.
We also incorporate by reference all
documents we file pursuant to Section 13(a), 13(c), 14 or 15 of the
Exchange Act (other than any portions of filings that are furnished
rather than filed pursuant to Items 2.02 and 7.01 of a Current
Report on Form 8-K) after the date of the initial registration
statement of which this prospectus supplement is a part and prior
to effectiveness of such registration statement. All documents we
file in the future pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this
prospectus supplement and prior to the termination
of the offering are also incorporated by reference and are an
important part of this prospectus supplement.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this registration statement to the
extent that a statement contained herein or in any other
subsequently filed document which also is or deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part
of this registration statement.
$50,000,000
COMMON STOCK
AzurRx BioPharma, Inc.
PROSPECTUS SUPPLEMENT
H.C. Wainwright & Co.
The
date of this prospectus supplement
is
, 2021
The information in this preliminary prospectus is not complete and
may be changed. A registration statement relating to these
securities has been filed with the Securities and Exchange
Commission. These securities may not be sold until the registration
statement is declared effective. This preliminary prospectus is not
an offer to sell these securities and is not soliciting an offer to
buy these securities, nor shall there be any sale of these
securities in any state or other jurisdiction where such offer,
solicitation or sale is not permitted or would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction.
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PRELIMINARY PROSPECTUS
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SUBJECT TO COMPLETION
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DATED MAY 26, 2021
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AzurRx BioPharma, Inc.
3,464,664 Shares of Common Stock
This
prospectus relates to the resale of up to 3,464,664 shares of
AzurRx BioPharma, Inc. (the “Company,”
“we,” “our,” or “us”) common
stock, par value $0.0001 per share, by the selling stockholders
listed in this prospectus or their permitted transferees. The
shares of common stock registered for resale pursuant to this
prospectus includes: (i) 75,663 shares of common stock issuable
upon exercise of warrants (the “Selling Agent
Warrants”) issued to Alexander Capital L.P. (together with
its designees identified as selling stockholders herein, as the
context may require, “Alexander”), or its designees, in
connection with the Selling Agent Agreement, dated April 1, 2019,
and the Selling Agent Agreement, dated May 9, 2019, by and between
us and Alexander (collectively, the “Selling Agent
Agreements”), (ii) 3,329,138 shares of common stock converted
from shares of Series C 9.00% Convertible Junior Preferred Stock,
par value $0.0001 per share (the “Series C Preferred
Stock”) issued to First Wave Bio, Inc. (“First
Wave”) pursuant to the securities purchase agreement, dated
January 8, 2021, by and between us and First Wave (the “First
Wave Purchase Agreement”) and (iii) 59,863 shares of common
stock issued to Armistice Capital Master Fund Ltd.
(“Armistice”) as accrued dividends in connection with
the issuance of the Series C Preferred Stock to Armistice pursuant
to a private placement and concurrent registered direct offering
which was completed on January 6, 2021.
We are
not selling any securities under this prospectus and will not
receive any of the proceeds from the sale of shares by the selling
stockholders. However, we may receive proceeds of up to
approximately $203,000 from the cash exercise of the Selling Agent
Warrants by the selling stockholders, once the registration
statement, of which this prospectus is part, is declared effective.
The Selling Agent Warrants may also be exercised and resold
hereunder on a cashless basis, at the option of their holders, and
we will not receive any proceeds upon such cashless
exercise.
The
selling stockholders may sell the shares of common stock described
in this prospectus in a number of different ways and at varying
prices. See “Plan of Distribution” on page 9 of this
prospectus for more information on how the selling stockholders may
sell the shares of common stock being registered pursuant to this
prospectus. The selling stockholders may be an
“underwriter” within the meaning of Section 2(a)(11) of
the Securities Act.
We will
pay the expenses incurred in registering the shares, including
legal and accounting fees. See “Plan of Distribution”
on page 9 of this prospectus.
We are an “emerging growth company” as defined in
Section 2(a) of the Securities Act, and we have elected to
comply with certain reduced public company reporting
requirements.
Our
common stock is listed on the Nasdaq Capital Market under the
symbol “AZRX.” On May 21, 2021, the last reported sale
price of our common stock on the Nasdaq Capital Market was $0.89
per share.
Investing in our securities involves a high degree of risk. See
“Risk Factors” beginning on page 3 of this
prospectus and
the documents incorporated by reference into this
prospectus for
a discussion of the risks that you should consider in connection
with an investment in our securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus
is
, 2021.
TABLE OF CONTENTS
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2
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3
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4
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6
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7
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8
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9
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11
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11
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11
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12
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PROSPECTUS SUMMARY
This
summary highlights information contained elsewhere in this
prospectus. This summary does not contain all of the information
that you should consider before deciding to invest in our
securities. You should read this entire
prospectus carefully,
including the “Risk Factors” section in this prospectus
and under similar captions in the documents incorporated by
reference into this prospectus. In this prospectus, unless
otherwise stated or the context otherwise requires, references to
“AzurRx”, “Company”, “we”,
“us”, “our” or similar references mean
AzurRx BioPharma, Inc. and its subsidiaries on a consolidated
basis. References to “AzurRx BioPharma” refer to AzurRx
BioPharma, Inc. on an unconsolidated basis. References to
“AzurRx SAS” refer to AzurRx SAS, AzurRx
BioPharma’s wholly-owned subsidiary through which we conduct
our European operations.
Overview
We are engaged in the research and development of
targeted, non-systemic therapies for the treatment of patients with
gastrointestinal (“GI”) diseases. Non-systemic therapies are
non-absorbable drugs that act locally, i.e. in the intestinal
lumen, skin or mucosa, without reaching an individual’s
systemic circulation. We are focused on
developing our pipeline of gut-restricted GI clinical drug
candidates, including MS1819 and niclosamide.
Our lead drug candidate
is MS1819, a recombinant lipase for the treatment of exocrine
pancreatic insufficiency (“EPI”)
in patients with cystic
fibrosis (“CF”) and chronic pancreatitis
(“CP”), currently in two
Phase 2 CF clinical trials. In March 2021, we announced topline results from
our Phase 2b OPTION 2 monotherapy trial, and in May 2021, we
announced positive interim results from the first 18 patients in
our Phase 2 Combination trial in Europe.
In 2021, we intend to
launch two new clinical programs using proprietary formulations of
niclosamide, a small molecule
with anti-helminthic, anti-viral and anti-inflammatory
properties; FW-1022, for
Severe Acute Respiratory Syndrome Coronavirus 2
(“COVID-19”)
gastrointestinal infections, and FW-420, for Grade 1 and Grade 2
Immune Checkpoint Inhibitor-Associated Colitis
(“ICI-AC”)
and diarrhea in advanced stage oncology patients.
We initiated our Phase 2 RESERVOIR
clinical trial using a proprietary oral immediate-release tablet
formulation of micronized niclosamide (FW-1022) for the treatment
of COVID-19 related GI infections in April 2021, and we are
preparing to initiate our Phase 1b/2a PASSPORT ICI-AC trial using
both an oral immediate-release tablet and a topical rectal enema
foam formulations of niclosamide (FW-420) in the first half of
2021.
Corporate Information
We were incorporated on January 30, 2014 in the State of
Delaware. In June 2014, we acquired 100% of the issued
and outstanding capital stock of AzurRx SAS. Our principal
executive offices are located at 1615 South Congress Avenue, Suite
103, Delray Beach, Florida 33445. Our telephone number is (646)
699-7855. We maintain a website at www.azurrx.com. The information
contained on our website is not, and should not be interpreted to
be, a part of this prospectus.
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THE OFFERING
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Shares
of common stock offered by the selling stockholders
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3,464,664 shares of common stock consisting
of:
●
up to 75,663 shares of common stock issuable
upon exercise, for cash, of the Selling Agent Warrants held by
certain selling stockholders.
●
3,329,138 shares of common stock issued
to First Wave upon conversion of the shares of Series C Preferred
Stock, plus accrued dividends thereon, issued pursuant to the First
Wave Purchase Agreement.
●
59,863 shares of common stock issued to
Armistice upon conversion of the accrued dividends on the shares of
Series C Preferred Stock issued pursuant to the private placement
and registered direct offering which was completed on January 6,
2021.
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Shares
of common stock outstanding before this offering
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78,575,131
shares of common stock
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Shares
of common stock to be outstanding after giving effect to the
issuance of 3,464,664 shares registered hereunder
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82,039,795
shares of common stock
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Use of
proceeds
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We are
not selling any securities under this prospectus and will not
receive any of the proceeds from the sale of shares by the selling
stockholder. However, we may receive proceeds of up to
approximately $203,000 from the cash exercise of the Selling Agent
Warrants by certain selling stockholders, once the registration
statement, of which this prospectus is part, is declared effective.
The Selling Agent Warrants may be exercised and resold hereunder on
a cashless basis, at the option of their holders, and we will not
receive any proceeds upon such cashless exercise.
We
anticipate that the proceeds we receive from the cash exercise of
the Selling Agent Warrants, if any, will be used for general
corporate purposes, which may include funding research, development
and product manufacturing, clinical trials, acquisitions or
investments in businesses, products or technologies that are
complementary to our own, increasing our working capital, reducing
indebtedness, and capital expenditures. Please see “Use of
Proceeds” on page 8.
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Terms
of this offering
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The
selling stockholders, including their transferees, donees,
pledgees, assignees and successors-in-interest, may sell, transfer
or otherwise dispose of any or all of the shares of common stock
offered by this prospectus from time to time on The Nasdaq Capital
Market or any other stock exchange, market or trading facility on
which the shares are traded or in private transactions. The shares
of common stock may be sold at fixed prices, at market prices
prevailing at the time of sale, at prices related to prevailing
market price or at negotiated prices.
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Risk
factors
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Investing
in our common stock involves a high degree of risk. See “Risk
Factors” beginning on page 3 of this prospectus and
under similar headings in the other documents that are filed after
the date hereof and incorporated by reference in this
prospectus for a discussion of factors to consider before
deciding to purchase shares of our common stock.
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Nasdaq
Capital Market symbol
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AZRX.
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RISK FACTORS
Before
purchasing any of the securities you should carefully consider the
risk factors incorporated by reference in this prospectus from our
Annual Report on Form 10-K for the fiscal year ended December 31,
2020 and any subsequent updates described in our Quarterly Reports
on Form 10-Q and Current Reports on Form 8-K, as well as the risks,
uncertainties and additional information set forth in our SEC
reports on Forms 10-K, 10-Q and 8-K and in the other documents
incorporated by reference in this prospectus. For a description of
these reports and documents, and information about where you can
find them, see “Where You Can Find More Information”
and “Incorporation of Certain Information By
Reference.” Additional risks not presently known or that we
presently consider to be immaterial could subsequently materially
and adversely affect our financial condition, results of
operations, business and prospects.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This
prospectus and any
documents we incorporate by reference, contain certain
forward-looking statements that involve substantial risks and
uncertainties. All statements contained in this
prospectus and any
documents we incorporate by reference, other than statements of
historical facts, are forward-looking statements including
statements regarding our strategy, future operations, future
financial position, future revenue, projected costs, prospects,
plans, objectives of management and expected market growth. These
statements involve known and unknown risks, uncertainties and other
important factors that may cause our actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements.
The
words “anticipate”, “believe”,
“estimate”, “expect”, “intend”,
“may”, “plan”, “predict”,
“project”, “target”,
“potential”, “will”, “would”,
“could”, “should”, “continue”
and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. These forward-looking statements include,
among other things, statements about:
●
statements
regarding the impact of the COVID-19 pandemic and its effects on
our operations, access to capital, research and development and
clinical trials and potential disruption in the operations and
business of third-party vendors, contract research organizations
(“CROs”),
contract development and manufacturing organizations
(“CDMOs”),
other service providers, and collaborators with whom we conduct
business;
●
availability of
capital to satisfy our working capital requirements;
●
our current and
future capital requirements and our ability to raise additional
funds to satisfy our capital needs;
●
the accuracy of our
estimates regarding expense, future revenue and capital
requirements;
●
ability to continue
operating as a going concern;
●
our plans to
develop and commercialize our drug candidates, including MS1819 and
niclosamide;
●
our ability to
initiate and complete our clinical trials and to advance our
principal drug candidates into additional clinical trials,
including pivotal clinical trials, and successfully complete such
clinical trials;
●
regulatory
developments in the U.S. and foreign countries;
●
the performance of
our third-party vendor(s), CROs, CDMOs and other third-party
non-clinical and clinical development collaborators and regulatory
service providers;
●
our ability to
obtain and maintain intellectual property protection for our core
assets;
●
the size of the
potential markets for our product candidates and our ability to
serve those markets;
●
the rate and degree
of market acceptance of our product candidates for any indication
once approved;
●
the success of
competing products and product candidates in development by others
that are or become available for the indications that we are
pursuing;
●
the loss of key
scientific, clinical and nonclinical development, and/or management
personnel, internally or from one of our third-party
collaborators;
●
other risks and
uncertainties, including those listed in the “Risk Factors” section of this
prospectus and the
documents incorporated by reference herein.
These
forward-looking statements are only predictions and we may not
actually achieve the plans, intentions or expectations disclosed in
our forward-looking statements, so you should not place undue
reliance on our forward-looking statements. Actual results or
events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make.
We have based these forward-looking statements largely on our
current expectations and projections about future events and trends
that we believe may affect our business, financial condition and
operating results. We have included important factors in the
cautionary statements included in this prospectus, as well as
certain information incorporated by reference into this prospectus,
that could cause actual future results or events to differ
materially from the forward-looking statements that we make. Our
forward-looking statements do not reflect the potential impact of
any future acquisitions, mergers, dispositions, joint ventures or
investments we may make.
Discussions
containing these forward-looking statements may be found, among
other places, in the sections titled “Business,”
“Risk Factors” and “Management’s Discussion
and Analysis of Financial Condition and Results of
Operations” incorporated by reference from our most recent
Annual Report on Form 10-K for the fiscal year ended December 31,
2020 and our most recent Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2021, as well as any amendments
thereto, filed with the SEC. Additional factors are discussed under
the caption “Risk Factors” in this prospectus and any
free writing prospectus and under similar headings in the other
documents that are incorporated by reference into this prospectus.
New risks and uncertainties arise from time to time, and it is
impossible for us to predict these events or how they may affect
us. We disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by
law.
You
should read this prospectus with the understanding that our
actual future results may be materially different from what we
expect. We do not assume any obligation to update any
forward-looking statements whether as a result of new information,
future events or otherwise, except as required by applicable
law.
DESCRIPTION OF THE
TRANSACTIONS
April 2019 Selling Agent Agreement
On
April 1, 2019, we entered into a Selling Agent Agreement (the
“April 2019 Selling Agent Agreement”) with Alexander,
pursuant to which Alexander agreed to act as selling agent in
connection with a public offering of shares of our common
stock (the “April 2019 Offering”). Pursuant to the
April 2019 Selling Agent Agreement, we agreed to pay Alexander a
cash fee equal to 7.0% of the aggregate gross proceeds of the April
2019 Offering and to issue Alexander warrants to purchase a number
of shares our common stock equal to 3.0% of the aggregate number of
shares of our common stock sold in the April 2019 Offering. We also
agreed to reimburse Alexander for its expenses in connection with
the April 2019 Offering on a non-accountable basis in an amount
equal to 1.0% of the gross proceeds of the April 2019 Offering and
up to $50,000 for other accountable expenses.
On
April 2, 2019, we offered and sold a total of 1,294,930 shares of
our common stock in connection with the April 2019 Offering at a
public offering price of $2.13 per share. As a result, we received
net proceeds of approximately $2.5 million, after deducting the
selling agent fee payable to Alexander and other April 2019
Offering expenses payable by us. In connection with the closing of
the April 2019 Offering and pursuant to the April 2019 Selling
Agent Agreement, the Company issued warrants to Alexander to
purchase up to 38,848 shares of our common stock (the “April
2019 Selling Agent Warrants”). The April 2019 Selling Agent
Warrants will become exercisable one year from the date of
issuance, expire on April 2, 2024 and have an exercise price of
$2.55 per share.
May 2019 Selling Agent Agreement
On May
9, 2019, we entered into a Selling Agent Agreement (the
“May 2019 Selling Agent Agreement”) with Alexander,
pursuant to which Alexander agreed to act as selling agent in
connection with a public offering of shares of our common
stock (the “May 2019 Offering” and with the April 2019
Offering, the “Offerings”). Pursuant to the May 2019
Selling Agent Agreement, we agreed to pay Alexander a cash fee
equal to 7.0% of the aggregate gross proceeds of the May 2019
Offering and to issue Alexander warrants to purchase a number of
shares of our common stock equal to 3.0% of the aggregate number of
shares of our common stock sold in the May 2019 Offering. We also
agreed to reimburse Alexander for its expenses in connection with
the May 2019 Offering on a non-accountable basis in an amount equal
to 1.0% of the gross proceeds of the May 2019 Offering and up to
$50,000 for other accountable expenses.
On May
13, 2019, we offered and sold a total of 1,227,167 shares of our
common stock in connection with the May 2019 Offering at a public
offering price of $2.35 per share. As a result, we received net
proceeds of approximately $2.55 million, after deducting the
selling agent fee payable to Alexander and other May 2019 Offering
expenses payable by us. In connection with the closing of the May
2019 Offering and pursuant to the May 2019 Selling Agent Agreement,
the Company issued warrants to Alexander to purchase up to 36,815
shares of our common stock (the “May 2019 Selling Agent
Warrants” and with the April 2019 Selling Agent Warrants, the
“Selling Agent Warrants”). The May 2019 Selling Agent
Warrants will become exercisable one year from the date of
issuance, expire on May 9, 2024 and have an exercise price of $2.82
per share.
The
Offerings were conducted pursuant to our effective shelf
registration statement on Form S-3 (File No. 333-226065),
filed with the Securities and Exchange Commission (the
“SEC”) on July 3, 2018, and declared effective on July
12, 2018. A prospectus supplement and the accompanying base
prospectus relating to the Offerings were filed with the SEC on
April 2, 2019 and May 9, 2019, respectively. The Selling Agent
Warrants were offered and sold without registration under the
Securities Act of 1933, as amended, pursuant to the exemption
provided in Section 4(a)(2) under the Securities Act and
Regulation D promulgated thereunder.
First Wave Purchase Agreement
On
January 8, 2021, pursuant to the license agreement, dated December
31, 2020, by and between us and First Wave, we entered into the
First Wave Purchase Agreement pursuant to which we issued First
Wave 3,290.1960 shares of Series C Preferred Stock, initially
convertible into an aggregate of 3,290,196 shares of our common
stock, at an initial stated value of $750.00 per share and a
conversion price of $0.75 per share. On February 24, 2021, our
stockholders approved certain proposals related to the issuance of
the Series C Preferred Stock, and all outstanding shares of Series
C Preferred Stock issued to First Wave were converted into an
aggregate of 3,329,138 shares of common stock, including the
3,290.1960 shares of Series C Preferred Stock plus accrued
dividends thereon through the conversion date.
Registered Direct Offering and Private Placement
On
December 31, 2020, we entered into a securities purchase agreement
(the “Series C Purchase Agreement”) with Armistice
pursuant to which we agreed to sell in a registered direct offering
(the “Registered Direct Offering”) 5,333.333 shares of
Series C Preferred Stock, at a price of $750 per share, initially
convertible into an aggregate of 5,333,334 shares of our common
stock, at an initial stated value of $750 per share and a
conversion price of $0.75 per share. The Registered Direct Offering
closed on January 6, 2021 and Armistice converted all of its Series
C Preferred Stock issued in the Registered Direct Offering,
effective immediately upon closing. Concurrently with the
Registered Direct Offering, in a private placement (the
“Private Placement”) pursuant to the Series C Purchase
Agreement, we also sold Armistice an additional 5,333.333 shares of
Series C Preferred Stock at the same price as the Series C
Preferred Stock offered in the Registered Direct Offering, which
shares are convertible into an aggregate of 5,333,334 shares of our
common stock, together with warrants to purchase up to an aggregate
of 10,666,668 shares of our common stock, with an exercise price of
$0.80 per share and an expiration term of five and a half years
from the date of issuance. The Private Placement closed on January
6, 2021.
On
February 24, 2021, our stockholders approved certain proposals
related to the issuance of the Series C Preferred Stock and all
outstanding shares of Series C Preferred Stock issued to Armistice
were converted into 5,393,197 shares of our common stock, including
the 5,333.333 shares of Series C Preferred Stock plus accrued
dividends thereon through the conversion date. 5,333,334 shares of
our common stock issued to Armistice upon conversion of the Series
C Preferred Stock was registered for resale on the Registration
Statement on Form S-1 (File No. 333-252087) filed with the SEC on
January 13, 2021 and was declared effective on January 21, 2021. We
are registering the 59,863 shares of common stock issued to
Armistice in respect of accrued dividends on the Series C Preferred
Stock through the conversion date on this registration
statement.
SELLING
STOCKHOLDERS
This prospectus relates to the sale from time to time by
the selling stockholders of up to 75,663 shares of our common
stock issuable upon exercise of the Selling Agent Warrants issued
in connection with the Offerings, 3,329,138 shares of our common
stock issued to First Wave upon conversion of the shares of Series
C Preferred Stock, plus accrued dividends thereon, issued pursuant
to the First Wave Purchase Agreement and 59,863 shares of our
common stock issued to Armistice as accrued dividends on the Series
C Preferred Stock issued pursuant to the Private
Placement. When we refer to the “selling
stockholders” in this prospectus, we mean the persons and
entities listed in the table below, and their respective pledgees,
donees, permitted transferees, assignees, successors and others who
later come to hold any of the selling stockholders’ interests
in shares of our common stock other than through a public
sale.
The selling stockholders may sell some, all or none of their
shares. We do not know how long the selling stockholders will hold
the shares before selling them, and we currently have no
agreements, arrangements or understandings with the selling
stockholder regarding the sale of any of the shares.
The following table presents information regarding the selling
stockholders and the shares that they may offer and sell from time
to time under this prospectus. The number of shares common
stock beneficially owned by the selling stockholders is determined
under rules promulgated by the SEC. Except as described above,
there are currently no agreements, arrangements or understandings
with respect to the resale of any of the securities covered by this
prospectus.
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|
|
Maximum Number of Shares
Being
Offered Pursuant to this Prospectus |
Shares Beneficially Owned After Offering (1)(2)
|
||
|
|
Shares
Beneficially
Owned Prior to Offering
|
|
Shares
of Common Stock Underlying Selling Agent
|
Shares
of Common
|
|
|
|
Name of Selling Stockholder
|
(1)
(2) (3)
|
|
Warrants
|
Stock
|
Number (3)
|
Percent (4)
|
|
Armistice
Capital Master Fund Ltd.
|
59,863
|
|
|
59,863
|
-
|
**%
|
|
Bari
Latterman
|
1,000
|
(5)
|
1,000
|
-
|
-
|
**%
|
|
Christopher
Carlin
|
222,873
|
(6)
|
31,731
|
-
|
191,142
|
**%
|
|
First
Wave Bio, Inc.
|
3,329,138
|
|
-
|
3,329,138
|
-
|
**%
|
|
Jonathan
Gazdak
|
48,641
|
(7)
|
24,266
|
-
|
24,375
|
**%
|
|
Joseph
Amato
|
48,042
|
(8)
|
9,333
|
-
|
38,709
|
**%
|
|
Rocco
Guidicipietro
|
22,708
|
(9)
|
9,333
|
-
|
13,375
|
**%
|
*
Beneficial
ownership assumes the exercise of any warrants and conversion of
any Series B Preferred Stock held by the selling
stockholder.
**
Less
than 1%
(1)
Except
as noted below, beneficial ownership is determined in accordance
with the rules of the SEC and generally includes voting or
investment power with respect to securities. All entries exclude
beneficial ownership of shares issuable pursuant to warrants,
options or other derivative securities that have not vested or that
are not otherwise exercisable as of the date hereof or which will
not become vested or exercisable within 60 days of May 21,
2021.
(2)
Based
upon our internal books and records and public filings only, as of
the date of this prospectus; may not include beneficial ownership
of shares of our common stock, if any, held in “street
name” through unrelated third-party brokers, as of the date
of this prospectus, which are not being offered for resale by this
prospectus.
(3)
Includes
certain shares of our common stock which are not being offered
pursuant to this prospectus.
(4)
All
percentage calculations are based on 78,575,131 shares of our
common stock outstanding as of May 21, 2021 and are rounded to the
nearest tenth of a percent. Warrants, options or other derivative
securities that are presently exercisable or exercisable within 60
days are deemed to be beneficially owned by the person holding such
securities for the purpose of calculating the percentage ownership
of that person, but are not treated as outstanding for the purpose
of calculating the percentage ownership of any other
person.
(5)
Includes
1,000 warrants issued to Alexander Capital L.P. and their assignees
which were designated to the selling stockholder.
(6)
Includes
190,974 warrants issued to Alexander Capital L.P. and their
assignees which were designated to the selling stockholder, and
31,899 shares of common stock.
(7)
Includes
24,266 warrants issued to Alexander Capital L.P. and their
assignees which were designated to the selling stockholder, and
24,375 shares of common stock.
(8)
Includes
48,042 warrants issued to Alexander Capital L.P. and their
assignees which were designated to the selling
stockholder.
(9)
Includes
13,333 warrants issued to Alexander Capital L.P. and their
assignees which were designated to the selling stockholder, and
9,375 shares of common stock.
Issuances
of our common stock to the selling stockholders will not affect the
rights or privileges of our existing stockholders, except that the
economic and voting interests of each of our existing stockholders
will be diluted as a result of any such issuance. Although the
number of shares of common stock that our existing stockholders own
will not decrease, the shares owned by our existing stockholders
will represent a smaller percentage of our total outstanding shares
after any such issuance to the selling stockholders identified
herein.
USE OF PROCEEDS
The
common stock to be offered and sold using this prospectus will be
offered and sold by the selling stockholders named in this
prospectus. Accordingly, we will not receive any proceeds from any
sales of shares of our common stock in this offering. Upon any cash
exercise of the Selling Agent Warrants, certain selling
stockholders will pay us the applicable exercise price. The Selling
Agent Warrants may be exercised and resold hereunder on a cashless
basis, at the option of their holders, and we will not receive any
proceeds upon such cashless exercise. We anticipate that any
proceeds that we receive from the cash exercise of such warrants,
if any, will be used for general corporate purposes, which may
include funding research, development and product manufacturing,
clinical trials, acquisitions or investments in businesses,
products or technologies that are complementary to our own,
increasing our working capital, reducing indebtedness, and capital
expenditures. We will pay all of the fees and expenses incurred by
us in connection with this registration. We will not be responsible
for fees and expenses incurred by the selling stockholders or any
underwriting discounts or agent’s commissions.
PLAN OF DISTRIBUTION
Each selling stockholder and any of their pledgees, assignees
and successors-in-interest may, from time to time, sell any or all
of their shares of common stock covered hereby from time to time
directly to one or more purchasers or through brokers, dealers, or
underwriters who may act solely as agents at market prices
prevailing at the time of sale, at prices related to the prevailing
market prices, at negotiated prices, or at fixed prices, which may
be changed. The sale of the common stock offered by this prospectus
could be affected in one or more of the following
methods:
●
ordinary brokers’ transactions;
●
transactions involving
cross or block trades;
●
through brokers,
dealers, or underwriters who may act solely as
agents;
●
“at the
market” into an existing market for the common
stock;
●
in other ways not
involving market makers or established business markets, including
direct sales to purchasers or sales effected through
agents;
●
in privately negotiated
transactions; or
●
any combination of the
foregoing.
The selling stockholders also may resell all or a portion of the
securities in open market transactions in reliance upon Rule 144
under the Securities Act, as permitted by that rule, or
Section 4(1) under the Securities Act, if available, rather
than under this prospectus, provided that they meet the criteria
and conform to the requirements of those
provisions
Broker-dealers engaged by the selling stockholders may arrange for
other brokers-dealers to participate in sales. If the selling
stockholders effect such transactions by selling securities to or
through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of
discounts, concessions or commissions from the selling stockholders
or commissions from purchasers of the securities for whom they may
act as agent or to whom they may sell as principal. Such
commissions will be in amounts to be negotiated, but, except as set
forth in a supplement to this prospectus, in the case of an agency
transaction will not be in excess of a customary brokerage
commission in compliance with NASD Rule 2440; and in the case of a
principal transaction a markup or markdown in compliance with NASD
IM-2440.
In connection with the sale of the common stock or interests
therein, the selling stockholders may enter into hedging
transactions with broker-dealers or other financial institutions,
which may in turn engage in short sales of the common stock in the
course of hedging the positions they assume. The selling
stockholders may also sell shares of the common stock short and
deliver these securities to close out their short positions, or
loan or pledge the shares of common stock to broker-dealers that in
turn may sell these securities. The selling stockholders may also
enter into option or other transactions with broker-dealers or
other financial institutions or create one or more derivative
securities which require the delivery to such broker-dealer or
other financial institution of shares offered by this prospectus,
which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as supplemented or amended to
reflect such transaction).
The selling stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be
“underwriters” within the meaning of the Securities Act
in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act.
Each selling stockholder has informed us that it does not have any
written or oral agreement or understanding, directly or indirectly,
with any person to distribute their shares of common
stock.
We are required to pay certain fees and expenses incurred by us
incident to the registration of the shares. We have agreed to
indemnify the selling stockholders against certain losses, claims,
damages and liabilities, including liabilities under the Securities
Act.
The selling stockholders will be subject to the prospectus delivery
requirements of the Securities Act, including Rule 172 thereunder.
The selling stockholders have advised us that there is no
underwriter or coordinating broker acting in connection with the
proposed sale of the resale shares by the selling
stockholders.
The resale shares will be sold only through registered or licensed
brokers or dealers if required under applicable state securities
laws. In addition, in certain states, the resale shares of common
stock covered hereby may not be sold unless they have been
registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is
available and is complied with.
Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the resale shares may not
simultaneously engage in market making activities with respect to
the common stock for the applicable restricted period, as defined
in Regulation M, prior to the commencement of the distribution. In
addition, the selling stockholders will be subject to applicable
provisions of the Exchange Act, and the rules and regulations
thereunder, including Regulation M, which may limit the timing of
purchases and sales of shares of the common stock by the selling
stockholders or any other person. We will make copies of this
prospectus available to the selling stockholders and have informed
them of the need to deliver a copy of this prospectus to each
purchaser at or prior to the time of the sale (including by
compliance with Rule 172 under the Securities Act).
Our common stock is quoted on The Nasdaq Capital Market under the
symbol “AZRX”.
LEGAL MATTERS
The
validity of the securities offered hereby will be passed upon for
us by Lowenstein Sandler LLP, New York, New York.
EXPERTS
The audited annual consolidated
financial statements of AzurRx BioPharma, Inc. incorporated by
reference in this prospectus and elsewhere in the registration
statement have been incorporated by reference in reliance upon the
report of Mazars USA LLP, independent registered public accounting
firm, upon the authority of said firm as experts in accounting and
auditing. The 2020 and 2019 audited annual consolidated financial
statements of AzurRx BioPharma, Inc., as of and for the years ended
December 31, 2020 and 2019, have been audited by Mazars USA LLP,
independent registered public accounting firm. The audit report
dated March 31, 2021 for the 2020 audited annual consolidated
financial statements includes an explanatory paragraph which states
that certain circumstances raise substantial doubt about our
ability to continue as a going concern.
WHERE YOU CAN FIND MORE
INFORMATION
We are
subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith file
annual, quarterly and current reports, proxy statements and other
information with the SEC. The SEC maintains a website that contains
reports, proxy and information statements and other information
regarding registrants that file electronically with the SEC. The
address of the SEC’S website is www.sec.gov.
We make
available free of charge on or through our website our Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q,
Current Reports on Form 8-K and amendments to those reports
filed or furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended, as soon as reasonably
practicable after we electronically file such material with or
otherwise furnish it to the SEC.
We have
filed with the SEC a registration statement under the Securities
Act, relating to the offering of these securities. The registration
statement, including the attached exhibits, contains additional
relevant information about us and the securities. This prospectus
does not contain all of the information set forth in the
registration statement. You can obtain a copy of the registration
statement for free at www.sec.gov. The registration statement and
the documents referred to below under “Incorporation of
Certain Information By Reference” are also available on our
website, www.azurrx.com/investors/regulatory-filings.
We have
not incorporated by reference into this prospectus the information on our website, and
you should not consider it to be a part of this
prospectus.
INCORPORATION OF CERTAIN INFORMATION
BY REFERENCE
The following documents filed with the SEC are incorporated by
reference into this prospectus:
●
our Annual Report on Form 10-K for the year ended December 31,
2020, filed with the SEC on March 31, 2021;
●
our Quarterly Report on Form 10-Q for the period ended March 31,
2021, filed with the SEC on May 24, 2021;
●
our Current Reports on Form 8-K, filed
with the SEC on January 4, 2021 (as amended on January 13, 2021),
January 5, 2021, January 8, 2021, February 16, 2021, February 25,
2021 and March 10, 2021 (other than any portion thereof deemed
furnished and not filed);
●
the description of our common stock which is registered under
Section 12 of the Exchange Act, in our registration statement on
Form 8-A, filed with the SEC on August 8, 2016, including any
amendment or reports filed for the purposes of updating this
description, including Exhibit 4.1 to our Annual Report on Form
10-K for the year ended December 31, 2020, filed with the SEC on
March 31, 2021.
We also incorporate by reference all
documents we file pursuant to Section 13(a), 13(c), 14 or 15 of the
Exchange Act (other than any portions of filings that are furnished
rather than filed pursuant to Items 2.02 and 7.01 of a Current
Report on Form 8-K) after the date of the initial registration
statement of which this prospectus is a part and prior to
effectiveness of such registration statement. All documents we file
in the future pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this prospectus and prior to the termination of the
offering are also incorporated by reference and are an important
part of this prospectus.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this registration statement to the
extent that a statement contained herein or in any other
subsequently filed document which also is or deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part
of this registration statement.
3,464,664 Shares
Common Stock
AzurRx BioPharma, Inc.
PROSPECTUS
We have
not authorized any dealer, salesperson or other person to give any
information or to make any representations not contained in this
prospectus. You must not rely on any unauthorized information. This
prospectus is not an offer to sell these securities in any
jurisdiction where an offer or sale is not permitted.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and
Distribution.
The following table indicates the expenses to be incurred in
connection with the offering described in this registration
statement, other than underwriting discounts and commissions, all
of which will be paid by us. All amounts are estimated except the
Securities and Exchange Commission registration fee.
|
|
Amount
|
|
SEC Registration
Fee
|
$16,696
|
|
FINRA Filing
Fees
|
23,000
|
|
Legal Fees and
Expenses
|
50,000
|
|
Accounting Fees and
Expenses
|
15,000
|
|
Transfer Agent and
Registrar fees and expenses
|
2,000
|
|
Miscellaneous
Expenses
|
3,000
|
|
|
|
|
Total
expenses
|
$109,696
|
Item 15. Indemnification of Directors and
Officers.
Amended and Restated Bylaws
Pursuant to our bylaws, our directors and officers will be
indemnified to the fullest extent allowed under the laws of the
State of Delaware for their actions in their capacity as our
directors and officers.
We must indemnify any person made a
party to any threatened, pending, or completed action, suit, or
proceeding, whether civil, criminal, administrative, or
investigative (“Proceeding”)
by reason of the fact that he is or was a director, against
judgments, penalties, fines, settlements and reasonable expenses
(including attorney’s fees) (“Expenses”)
actually and reasonably incurred by him in connection with such
Proceeding if: (a) he conducted himself in good faith, and: (i) in
the case of conduct in his own official capacity with us, he
reasonably believed his conduct to be in our best interests, or
(ii) in all other cases, he reasonably believes his conduct to be
at least not opposed to our best interests; and (b) in the case of
any criminal Proceeding, he had no reasonable cause to believe his
conduct was unlawful.
We must indemnify any person made a party to any Proceeding by or
in the right of us, by reason of the fact that he is or was a
director, against reasonable expenses actually incurred by him in
connection with such proceeding if he conducted himself in good
faith, and: (a) in the case of conduct in his official capacity
with us, he reasonably believed his conduct to be in our best
interests; or (b) in all other cases, he reasonably believed his
conduct to be at least not opposed to our best interests; provided
that no such indemnification may be made in respect of any
proceeding in which such person shall have been adjudged to be
liable to us.
No indemnification will be made by unless authorized in the
specific case after a determination that indemnification of the
director is permissible in the circumstances because he has met the
applicable standard of conduct.
Reasonable expenses incurred by a director who is party to a
proceeding may be paid or reimbursed by us in advance of the final
disposition of such Proceeding in certain cases.
We have the power to purchase and maintain insurance on behalf of
any person who is or was our director, officer, employee, or agent
or is or was serving at our request as an officer, employee or
agent of another corporation, partnership, joint venture, trust,
other enterprise, or employee benefit plan against any liability
asserted against him and incurred by him in any such capacity or
arising out of his status as such, whether or not we would have the
power to indemnify him against such liability under the provisions
of the amended and restated bylaws.
Delaware Law
We are incorporated under the laws of the State of Delaware.
Section 145 of the Delaware General Corporation Law provides that a
Delaware corporation may indemnify any persons who are, or are
threatened to be made, parties to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the
right of such corporation), by reason of the fact that such person
was an officer, director, employee or agent of such corporation, or
is or was serving at the request of such person as an officer,
director, employee or agent of another corporation or enterprise.
The indemnity may include expenses (including attorneys’
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action,
suit or proceeding, provided that such person acted in good faith
and in a manner he or she reasonably believed to be in or not
opposed to the corporation’s best interests and, with respect
to any criminal action or proceeding, had no reasonable cause to
believe that his or her conduct was illegal. A Delaware corporation
may indemnify any persons who are, or are threatened to be made, a
party to any threatened, pending or completed action or suit by or
in the right of the corporation by reason of the fact that such
person was a director, officer, employee or agent of such
corporation, or is or was serving at the request of such
corporation as a director, officer, employee or agent of another
corporation or enterprise. The indemnity may include expenses
(including attorneys’ fees) actually and reasonably incurred
by such person in connection with the defense or settlement of such
action or suit provided such person acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the
corporation’s best interests except that no indemnification
is permitted without judicial approval if the officer or director
is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of
any action referred to above, the corporation must indemnify him or
her against the expenses which such officer or director has
actually and reasonably incurred. Our amended and restated
certificate of incorporation and amended and restated bylaws
provide for the indemnification of our directors and officers to
the fullest extent permitted under the Delaware General Corporation
Law.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a
director of the corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of
fiduciary duties as a director, except for liability for
any:
●
transaction from which the director derives an improper personal
benefit;
●
act or omission not in good faith or that involves intentional
misconduct or a knowing violation of law;
●
unlawful payment of dividends or redemption of shares;
or
●
breach of a director’s duty of loyalty to the corporation or
its stockholders.
Our amended and restated certificate of incorporation and amended
and restated bylaws include such a provision. Expenses incurred by
any officer or director in defending any such action, suit or
proceeding in advance of its final disposition shall be paid by us
upon delivery to us of an undertaking, by or on behalf of such
director or officer, to repay all amounts so advanced if it shall
ultimately be determined that such director or officer is not
entitled to be indemnified by us.
Section 174 of the Delaware General Corporation Law provides, among
other things, that a director who willfully or negligently approves
of an unlawful payment of dividends or an unlawful stock purchase
or redemption may be held liable for such actions. A director who
was either absent when the unlawful actions were approved, or
dissented at the time, may avoid liability by causing his or her
dissent to such actions to be entered in the books containing
minutes of the meetings of the board of directors at the time such
action occurred or immediately after such absent director receives
notice of the unlawful acts.
Indemnification Agreements
As permitted by the Delaware General Corporation Law, we have
entered, and intend to continue to enter, into separate
indemnification agreements with each of our directors and executive
officers, that require us to indemnify such persons against any and
all expenses (including attorneys’ fees), witness fees,
damages, judgments, fines, settlements and other amounts incurred
(including expenses of a derivative action) in connection with any
action, suit or proceeding, whether actual or threatened, to which
any such person may be made a party by reason of the fact that such
person is or was a director, an officer or an employee of us or any
of our affiliated enterprises, provided that such person acted in
good faith and in a manner such person reasonably believed to be in
or not opposed to our best interests and, with respect to any
criminal proceeding, had no reasonable cause to believe his or her
conduct was unlawful. The indemnification agreements also set forth
certain procedures that will apply in the event of a claim for
indemnification thereunder.
At present, there is no pending litigation or proceeding involving
any of our directors or executive officers as to which
indemnification is required or permitted, and we are not aware of
any threatened litigation or preceding that may result in a claim
for indemnification.
We have an insurance policy covering our officers and directors
with respect to certain liabilities, including liabilities arising
under the Securities Act or otherwise.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to our directors, officers or
controlling persons, we have been advised that in the opinion of
the SEC this indemnification is against public policy as expressed
in the Securities Act and is, therefore,
unenforceable.
Item 16.
Exhibits
|
Exhibit No.
|
|
Description
|
|
|
|
|
|
1.1
|
|
Form of
Underwriting Agreement.**
|
|
|
At The Market
Offering Agreement, dated May 26, 2021, by and between AzurRx
BioPharma, Inc. and H.C. Wainwright & Co.,
LLC.*
|
|
|
|
Amended
and Restated Certificate of Incorporation of the Registrant, as
amended (incorporated by reference to Exhibit 3.2 of the
Company’s Quarterly Report on Form 10-Q filed with the SEC on
May 24, 2021).
|
|
|
|
Amended
and Restated Bylaws (incorporated by reference to Exhibit 3.1 of
the Company’s Current Report on Form 8-K filed with the SEC
on August 5, 2020).
|
|
|
3.3
|
|
Certificate
of Designations of Preferred Stock.**
|
|
|
Specimen
Common Stock Certificate (Incorporated by reference from Exhibit
4.1 filed with Amendment No. 1 to Registration Statement on Form
S-1, filed July 29, 2016).
|
|
|
4.2
|
|
Specimen
Preferred Stock Certificate.**
|
|
4.3
|
|
Form
of Warrant Agreement.**
|
|
4.4
|
|
Form
of Warrant Certificate.**
|
|
4.5
|
|
Form
of Unit Agreement.**
|
|
4.6
|
|
Form
of Subscription Agreement.**
|
|
|
Opinion
of Lowenstein Sandler LLP.*
|
|
|
|
Consent
of Independent Registered Public Accounting Firm – Mazars USA
LLP.*
|
|
|
|
Consent
of Lowenstein Sandler LLP (included in Exhibit 5.1).*
|
|
|
|
Power
of Attorney (included in signature page).*
|
|
*
|
Filed herewith.
|
|
**
|
To be filed, if applicable, by amendment or by a report filed under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934, as amended, and incorporated herein by
reference.
|
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(a) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933,
(b) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information
set forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the “Calculation of Registration
Fee” table in the effective registration
statement,
(c) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
Provided, however,
that paragraphs (1)(a), (1)(b) and (1)(c) above do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference
in the registration statement, or is contained in a form of
prospectus filed pursuant to Rule 424(b) that is part of the
registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser:
(a) If the registrant is relying on Rule 430B:
(i) Each prospectus filed by the registrant pursuant to Rule
424(b)(3) shall be deemed to be part of the registration statement
as of the date the filed prospectus was deemed part of and included
in the registration statement; and
(ii) Each prospectus required to
be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a
registration statement in reliance on Rule 430B relating to an
offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the
purpose of providing the information required by section 10(a) of
the Securities Act of 1933 shall be deemed to be part of and
included in the registration statement as of the earlier of the
date such form of prospectus is first used after effectiveness or
the date of the first contract of sale of securities in the
offering described in the prospectus. As provided in Rule 430B, for
liability purposes of the issuer and any person that is at that
date an underwriter, such date shall be deemed to be a new
effective date of the registration statement relating to the
securities in the registration statement to which that prospectus
relates, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Provided,
however, that no
statement made in a registration statement or prospectus that is
part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or modify
any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in
any such document immediately prior to such effective
date.
(b) If the registrant is subject
to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part
of a registration statement relating to an offering, other than
registration statements relying on Rule 430B or other than
prospectuses filed in reliance on Rule 430A, shall be deemed
to be a part of and included in the registration statement as of
the date it is first used after
effectiveness. Provided,
however,
that no statement made in a registration statement or prospectus
that is part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such
document immediately prior to such date of first
use.
(5) That, for the purpose of determining liability of the
registrant under the Securities Act of 1933 to any purchaser in the
initial distribution of the securities, the registrant undertakes
that in a primary offering of securities of the registrant pursuant
to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of
the following communications, the registrant will be a seller to
the purchaser and will be considered to offer or sell such
securities to such purchaser:
(a) Any preliminary prospectus or prospectus of the registrant
relating to the offering required to be filed pursuant to Rule
424;
(b) Any free writing prospectus relating to the offering
prepared by or on behalf of the registrant or used or referred to
by the registrant;
(c) The portion of any other free writing prospectus relating
to the offering containing material information about the
registrant or its securities provided by or on behalf of the
registrant; and
(d) Any other communication that is an offer in the offering
made by a registrant to the purchaser.
(6) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant’s
annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan’s annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated
by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(7) The undersigned hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act
under subsection (a) of Section 310 of the Trust Indenture Act in
accordance with the rules and regulations prescribed by the
Commission under Section 305(b)(2) of the Act.
(8) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the forgoing
provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has
duly caused this registration statement thereto to be signed on its
behalf by the undersigned, thereunto duly authorized, in the
City of Delray Beach, Florida on this 26th day of May,
2021.
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AZURRX BIOPHARMA, INC.
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By: /s/ James
Sapirstein
Name: James
Sapirstein
Title:
President, Chief Executive Officer and
Chairman of the Board
(Principal Executive
Officer)
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KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints James Sapirstein and Daniel
Schneiderman, and each of them, each with full power to act without
the other, his true and lawful attorneys-in-fact and agents,
each with full power of substitution and resubstitution, for such
person and in his name, place and stead, in any and all capacities,
to sign any amendments to this registration statement, and to sign
any registration statement for the same offering covered by this
registration statement, including post-effective amendments or
registration statements filed pursuant to Rule 462(b) under the
Securities Act of 1933, and to file the same, with all exhibits
thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming
that each of said such attorneys-in-fact and agents or his
substitute or substitutes, may do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in
the capacities and on the dates indicated.
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Signature
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Title
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Date
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/s/ James Sapirstein
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President, Chief Executive Officer and
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May 26, 2021
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James Sapirstein
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Chairman of the Board
(Principal Executive Officer)
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/s/ Daniel Schneiderman
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Chief Financial Officer
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May 26, 2021
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Daniel Schneiderman
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(Principal
Financial Officer and
Principal Accounting Officer)
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/s/ Edward J.
Borkowski
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Director
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May 26, 2021
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Edward J. Borkowski
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/s/ Charles
Casamento
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Director
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May 26, 2021
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Charles Casamento
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/s/ Alastair
Riddell
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Director
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May 26, 2021
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Alastair Riddell
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/s/ Gregory
Oaks
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Director
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May 26, 2021
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Gregory Oaks
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/s/ Vern Lee
Schramm
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Director
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May 26, 2021
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Vern Lee Schramm
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II-6
Exhibit 1.2
AT THE MARKET OFFERING AGREEMENT
May 26,
2021
H.C.
Wainwright & Co., LLC
430
Park Avenue
New
York, New York 10022
Ladies
and Gentlemen:
AzurRx
BioPharma, Inc., a corporation organized under the laws of Delaware
(the “Company”), confirms its
agreement (this “Agreement”) with H.C.
Wainwright & Co., LLC (the “Manager”) as
follows:
1. Definitions.
The terms that follow, when used in this Agreement and any Terms
Agreement, shall have the meanings indicated.
“Accountants” shall
have the meaning ascribed to such term in Section
4(m).
“Act” shall mean the
Securities Act of 1933, as amended, and the rules and regulations
of the Commission promulgated thereunder.
“Action” shall have the
meaning ascribed to such term in Section 3(q).
“Affiliate” shall have the
meaning ascribed to such term in Section 3(p).
“Applicable Time” shall
mean, with respect to any Shares, the time of sale of such Shares
pursuant to this Agreement or any relevant Terms
Agreement.
“Base Prospectus” shall
mean the base prospectus contained in the Registration Statement at
the Effective Time.
“Board” shall have the
meaning ascribed to such term in Section 2(b)(iii).
“Broker Fee” shall have
the meaning ascribed to such term in Section 2(b)(v).
“Business Day” shall mean
any day other than Saturday, Sunday or other day on which
commercial banks in The City of New York are authorized or required
by law to remain closed; provided, however, that, for purposes of
clarity, commercial banks shall not be deemed to be authorized or
required by law to remain closed due to “stay at home”,
“shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions
or the closure of any physical branch locations at the direction of
any governmental authority so long as the electronic funds transfer
systems (including for wire transfers) of commercial banks in The
City of New York generally are open for use by customers on such
day.
1
“Commission” shall mean
the United States Securities and Exchange Commission.
“Common Stock” shall have
the meaning ascribed to such term in Section 2.
“Common Stock Equivalents”
shall have the meaning ascribed to such term in Section
3(g).
“Company Counsel” shall
have the meaning ascribed to such term in Section
4(l).
“DTC” shall have the
meaning ascribed to such term in Section 2(b)(vii).
“Effective Date” shall
mean each date and time that the Registration Statement and any
post-effective amendment or amendments thereto became or becomes
effective.
“Effective Time” shall
mean the first date and time that the Registration Statement
becomes effective.
“Exchange Act” shall mean
the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.
“Execution Time” shall
mean the date and time that this Agreement is executed and
delivered by the parties hereto.
“Filing Date” shall have
the meaning ascribed to such term in Section 4(w).
“Free Writing Prospectus”
shall mean a free writing prospectus, as defined in
Rule 405.
“GAAP” shall have the
meaning ascribed to such term in Section 3(n).
“Incorporated Documents”
shall mean the documents or portions thereof filed with the
Commission on or prior to the Effective Date that are incorporated
by reference in the Registration Statement or the Prospectus and
any documents or portions thereof filed with the Commission after
the Effective Date that are deemed to be incorporated by reference
in the Registration Statement or the Prospectus.
2
“Intellectual Property
Rights” shall have
the meaning ascribed to such term in Section 3(v).
“Issuer Free Writing
Prospectus” shall mean an issuer free writing
prospectus, as defined in Rule 433.
“Losses” shall have the
meaning ascribed to such term in Section 7(d).
“Material Adverse Effect”
shall have the meaning ascribed to such term in Section
3(b).
“Material Permits” shall
have the meaning ascribed to such term in Section
3(t).
“Net Proceeds” shall have
the meaning ascribed to such term in Section 2(b)(v).
“Permitted Free Writing
Prospectus” shall have the meaning ascribed to such
term in Section 4(g).
“Placement” shall have the
meaning ascribed to such term in Section 2(c).
“Proceeding” shall have
the meaning ascribed to such term in Section 3(b).
“Prospectus” shall mean
the Base Prospectus, as supplemented by the Prospectus Supplement
in the Registration Statement at the Effective Time and any
subsequently filed Prospectus Supplement.
“Prospectus Supplement”
shall mean the prospectus supplement relating to the Shares
contained in the Registration Statement at the Effective Time and
any prospectus supplement relating to the Shares prepared and filed
pursuant to Rule 424(b) from time to time.
“Registration Statement”
shall mean the shelf registration statement on Form S-3
registering $150,000,000 of securities of the Company to be filed
on or after the Execution Date, including exhibits and financial
statements and any prospectus supplement relating to the Shares
that is filed with the Commission pursuant to Rule 424(b) and
deemed part of such registration statement pursuant to
Rule 430B, as amended on each Effective Date and, in the event
any post-effective amendment thereto becomes effective, shall also
mean such registration statement as so amended.
“Representation Date”
shall have the meaning ascribed to such term in Section
4(k).
3
“Required Approvals” shall
have the meaning ascribed to such term in Section
3(e).
“Rule 158”,
“Rule 164”,
“Rule 172”,
“Rule 173”,
“Rule 405”,
“Rule 415”,
“Rule 424”,
“Rule 430B” and
“Rule 433” refer to
such rules under the Act.
“Sales Notice” shall have
the meaning ascribed to such term in Section 2(b)(i).
“SEC Reports” shall have
the meaning ascribed to such term in Section 3(m).
“Settlement Date” shall
have the meaning ascribed to such term in Section
2(b)(vii).
“Subsidiary” shall have
the meaning ascribed to such term in Section 3(a).
“Terms Agreement” shall
have the meaning ascribed to such term in Section
2(a).
“Time of Delivery” shall
have the meaning ascribed to such term in Section
2(c).
“Trading Day” means a day
on which the Trading Market is open for trading.
“Trading Market” means The
Nasdaq Capital Market.
2. Sale
and Delivery of Shares. The Company proposes to issue and
sell through or to the Manager, as sales agent and/or principal,
from time to time during the term of this Agreement and on the
terms set forth herein, up to the lesser of such number of shares
(the “Shares”) of the
Company’s common stock, $0.0001 par value per share
(“Common
Stock”), that does not exceed (a) the number or dollar
amount of shares of Common Stock registered on the Registration
Statement, pursuant to which the offering is being made, (b) the
number of authorized but unissued shares of Common Stock (less the
number of shares of Common Stock issuable upon exercise, conversion
or exchange of any outstanding securities of the Company or
otherwise reserved from the Company’s authorized capital
stock), or (c) the number or dollar amount of shares of Common
Stock that would cause the Company or the offering of the Shares to
not satisfy the eligibility and transaction requirements for use of
Form S-3, including, if applicable, General Instruction I.B.6 of
Registration Statement on Form S-3 (the lesser of (a), (b) and (c),
the “Maximum
Amount”). Notwithstanding anything to the contrary
contained herein, the parties hereto agree that compliance with the
limitations set forth in this Section 2 on the number and aggregate
sales price of Shares issued and sold under this Agreement shall be
the sole responsibility of the Company and that the Manager shall
have no obligation in connection with such compliance.
4
(a) Appointment
of Manager as Selling Agent; Terms Agreement. For purposes
of selling the Shares through the Manager, the Company hereby
appoints the Manager as exclusive agent of the Company for the
purpose of selling the Shares of the Company pursuant to this
Agreement and the Manager agrees to use its commercially reasonable
efforts to sell the Shares on the terms and subject to the
conditions stated herein. The Company agrees that, whenever it
determines to sell the Shares directly to the Manager as principal,
it will enter into a separate agreement (each, a
“Terms
Agreement”) in substantially the form of Annex I hereto, relating to
such sale in accordance with Section 2 of this
Agreement.
(b) Agent
Sales. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, following
the effectiveness of the Registration Statement, the Company will
issue and agrees to sell Shares from time to time through the
Manager, acting as sales agent, and the Manager agrees to use its
commercially reasonable efforts to sell, as sales agent for the
Company, on the following terms:
(i) The
Shares are to be sold on a daily basis or otherwise as shall be
agreed to by the Company and the Manager on any day that
(A) is a Trading Day, (B) the Company has instructed the
Manager by telephone (confirmed promptly by electronic mail) to
make such sales (“Sales Notice”) and (C)
the Company has satisfied its obligations under Section 6 of this
Agreement. The Company will designate the maximum amount of the
Shares to be sold by the Manager daily (subject to the limitations
set forth in Section 2(d)) and the minimum price per Share at which
such Shares may be sold. Subject to the terms and conditions
hereof, the Manager shall use its commercially reasonable efforts
to sell on a particular day all of the Shares designated for the
sale by the Company on such day. The gross sales price of the
Shares sold under this Section 2(b) shall be the market price
for the shares of Common Stock sold by the Manager under this
Section 2(b) on the Trading Market at the time of sale of such
Shares.
(ii) The
Company acknowledges and agrees that (A) there can be no
assurance that the Manager will be successful in selling the
Shares, (B) the Manager will incur no liability or obligation
to the Company or any other person or entity if it does not sell
the Shares for any reason other than a failure by the Manager to
use its commercially reasonable efforts consistent with its normal
trading and sales practices and applicable law and regulations to
sell such Shares as required under this Agreement, and (C) the
Manager shall be under no obligation to purchase Shares on a
principal basis pursuant to this Agreement, except as otherwise
specifically agreed by the Manager and the Company pursuant to a
Terms Agreement.
5
(iii) The
Company shall not authorize the issuance and sale of, and the
Manager shall not be obligated to use its commercially reasonable
efforts to sell, any Share at a price lower than the minimum price
therefor designated from time to time by the Company’s Board
of Directors (the “Board”), or a duly
authorized committee thereof, or such duly authorized officers of
the Company, and notified to the Manager in writing. The Company or
the Manager may, upon notice to the other party hereto by telephone
(confirmed promptly by electronic mail), suspend the offering of
the Shares for any reason and at any time; provided, however, that such suspension
or termination shall not affect or impair the parties’
respective obligations with respect to the Shares sold hereunder
prior to the giving of such notice.
(iv) The
Manager may sell Shares by any method permitted by law deemed to be
an “at the market offering” as defined in Rule 415
under the Act, including without limitation sales made directly on
the Trading Market, on any other existing trading market for the
Common Stock or to or through a market maker. The Manager may also
sell Shares in privately negotiated transactions, provided that the
Manager receives the Company’s prior written approval for any
sales in privately negotiated transactions and if so provided in
the “Plan of Distribution” section of the Prospectus
Supplement or a supplement to the Prospectus Supplement or a new
Prospectus Supplement disclosing the terms of such privately
negotiated transaction.
(v) The
compensation to the Manager for sales of the Shares under this
Section 2(b) shall be a placement fee of 3.0% of the gross sales
price of the Shares sold pursuant to this Section 2(b)
(“Broker
Fee”). The foregoing rate of compensation shall not
apply when the Manager acts as principal, in which case the Company
may sell Shares to the Manager as principal at a price agreed upon
at the relevant Applicable Time pursuant to a Terms Agreement. The
remaining proceeds, after deduction of the Broker Fee and deduction
of any transaction fees imposed by any clearing firm, execution
broker, or governmental or self-regulatory organization in respect
of such sales, shall constitute the net proceeds to the Company for
such Shares (the “Net
Proceeds”).
(vi) The
Manager shall provide written confirmation (which may be by
facsimile or electronic mail) to the Company following the close of
trading on the Trading Market each day in which the Shares are sold
under this Section 2(b) setting forth the number of the Shares sold
on such day, the aggregate gross sales proceeds and the Net
Proceeds to the Company, and the compensation payable by the
Company to the Manager with respect to such sales.
6
(vii) Unless
otherwise agreed between the Company and the Manager, settlement
for sales of the Shares will occur at 10:00 a.m. (New York City
time) on the second (2nd) Trading Day (or such earlier day as is
industry practice for regular-way trading) following the date on
which such sales are made (each, a “Settlement Date”). On or
before the Trading Day prior to each Settlement Date, the Company
will, or will cause its transfer agent to, electronically transfer
the Shares being sold by crediting the Manager’s or its
designee’s account (provided that the Manager shall have
given the Company written notice of such designee at least one
Trading Day prior to the Settlement Date) at The Depository Trust
Company (“DTC”) through its Deposit
and Withdrawal at Custodian System or by such other means of
delivery as may be mutually agreed upon by the parties hereto which
Shares in all cases shall be freely tradable, transferable,
registered shares in good deliverable form. On each Settlement
Date, the Manager will deliver the related Net Proceeds in same day
funds to an account designated by the Company. The Company agrees
that, if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver duly authorized Shares on a
Settlement Date, in addition to and in no way limiting the rights
and obligations set forth in Section 7 hereto, the Company will (i)
hold the Manager harmless against any loss, claim, damage, or
reasonable, documented expense (including reasonable and documented
legal fees and expenses), as incurred, arising out of or in
connection with such default by the Company, and (ii) pay to the
Manager any commission, discount or other compensation to which the
Manager would otherwise have been entitled absent such
default.
(viii)
At each Applicable Time, Settlement Date, and Representation Date,
the Company shall be deemed to have affirmed each representation
and warranty contained in this Agreement as if such representation
and warranty were made as of such date, modified as necessary to
relate to the Registration Statement and the Prospectus as amended
as of such date. Any obligation of the Manager to use its
commercially reasonable efforts to sell the Shares on behalf of the
Company shall be subject to the continuing accuracy of the
representations and warranties of the Company herein, to the
performance by the Company of its obligations hereunder and to the
continuing satisfaction of the additional conditions specified in
Section 6 of this Agreement.
(ix) If
the Company shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to
holders of shares of Common Stock, by way of return of capital or
otherwise (including, without limitation, any distribution of cash,
stock or other securities, property or options by way of a
dividend, spin off, reclassification, corporate rearrangement,
scheme of arrangement or other similar transaction) (a
“Distribution” and the
record date for the determination of stockholders entitled to
receive the Distribution, the “Record Date”), the
Company hereby covenants that, in connection with any sales of
Shares pursuant to a Sales Notice on the Record Date, the Company
covenants and agrees that the Company shall issue and deliver such
Shares to the Manager on the Record Date and the Record Date shall
be the Settlement Date and the Company shall cover any additional
costs of the Manager in connection with the delivery of Shares on
the Record Date.
7
(c) Term
Sales. If the Company wishes to sell the Shares pursuant to
this Agreement but other than as set forth in Section 2(b) of this
Agreement (each, a “Placement”), the Company
will notify the Manager of the proposed terms of such Placement. If
the Manager, acting as principal, wishes to accept such proposed
terms (which it may decline to do for any reason in its sole
discretion) or, following discussions with the Company wishes to
accept amended terms, the Manager and the Company will enter into a
Terms Agreement setting forth the terms of such Placement. The
terms set forth in a Terms Agreement will not be binding on the
Company or the Manager unless and until the Company and the Manager
have each executed such Terms Agreement accepting all of the terms
of such Terms Agreement. In the event of a conflict between the
terms of this Agreement and the terms of a Terms Agreement, the
terms of such Terms Agreement will control. A Terms Agreement may
also specify certain provisions relating to the reoffering of such
Shares by the Manager. The commitment of the Manager to purchase
the Shares pursuant to any Terms Agreement shall be deemed to have
been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and
conditions herein set forth. Each Terms Agreement shall specify the
number of the Shares to be purchased by the Manager pursuant
thereto, the price to be paid to the Company for such Shares, any
provisions relating to rights of, and default by, underwriters
acting together with the Manager in the reoffering of the Shares,
and the time and date (each such time and date being referred to
herein as a “Time of
Delivery”) and place of delivery of and payment for
such Shares. Such Terms Agreement shall also specify any
requirements for opinions of counsel, accountants’ letters
and officers’ certificates pursuant to Section 6 of this
Agreement and any other information or documents required by the
Manager.
(d) Maximum
Number of Shares. Under no circumstances shall the Company
cause or request the offer or sale of any Shares if, after giving
effect to the sale of such Shares, the aggregate amount of Shares
sold pursuant to this Agreement would exceed the lesser of (A)
together with all sales of Shares under this Agreement, the Maximum
Amount, (B) the amount available for offer and sale under the
currently effective Registration Statement and (C) the amount
authorized from time to time to be issued and sold under this
Agreement by the Board, a duly authorized committee thereof or a
duly authorized executive committee, and notified to the Manager in
writing. Under no circumstances shall the Company cause or request
the offer or sale of any Shares pursuant to this Agreement at a
price lower than the minimum price authorized from time to time by
the Board, a duly authorized committee thereof or a duly authorized
executive officer, and notified to the Manager in writing. Further,
under no circumstances shall the Company cause or permit the
aggregate offering amount of Shares sold pursuant to this Agreement
to exceed the Maximum Amount.
(e) Regulation
M Notice. Unless the exceptive provisions set forth in
Rule 101(c)(1) of Regulation M under the Exchange Act are
satisfied with respect to the Shares, the Company shall give the
Manager at least one Business Day’s prior notice of its
intent to sell any Shares in order to allow the Manager time to
comply with Regulation M.
8
3. Representations
and Warranties. The Company represents and warrants to, and
agrees with, the Manager at the Execution Time and on each such
time the following representations and warranties are repeated or
deemed to be made pursuant to this Agreement, as set forth below or
in the Registration Statement, the Prospectus or the Incorporated
Documents.
(a) Subsidiaries.
All of the direct and indirect subsidiaries (individually, a
“Subsidiary”)
of the Company are set forth on Exhibit 21.1 to the Company’s
most recent Annual Report on Form 10-K filed with the Commission.
The Company owns, directly or indirectly, all of the capital stock
or other equity interests of each Subsidiary free and clear of any
“Liens”
(which for purposes of this Agreement shall mean a lien, charge,
security interest, encumbrance, right of first refusal, preemptive
right or other restriction), and all of the issued and
outstanding shares of capital stock of each Subsidiary are validly
issued and are fully paid, non-assessable and free of preemptive
and similar rights to subscribe for or purchase
securities.
(b) Organization
and Qualification. The
Company and each of the Subsidiaries is an entity duly incorporated
or otherwise organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization,
with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently
conducted. Neither the Company nor any Subsidiary is in violation
nor default of any of the provisions of its respective certificate
or articles of incorporation, bylaws or other organizational or
charter documents. Each of the Company and the Subsidiaries is duly
qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the
nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so
qualified or in good standing, as the case may be, could not have
or reasonably be expected to result in: (i) a material adverse
effect on the legality, validity or enforceability of this
Agreement, (ii) a material adverse effect on the results of
operations, assets, business, prospects or condition (financial or
otherwise) of the Company and the Subsidiaries, taken as a whole,
from that set forth in the Registration Statement, the Base
Prospectus, any Prospectus Supplement, the Prospectus or the
Incorporated Documents, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a
timely basis its obligations under this Agreement (any of (i), (ii)
or (iii), a “Material Adverse Effect”)
and no “Proceeding”
(which for purposes of this Agreement shall mean any action, claim,
suit, investigation or proceeding (including, without limitation,
an informal investigation or partial proceeding, such as a
deposition), whether commenced or threatened) has been instituted
in any such jurisdiction revoking, limiting or curtailing or
seeking to revoke, limit or curtail such power and authority or
qualification.
9
(c) Authorization
and Enforcement. The
Company has the requisite corporate power and authority to enter
into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder. The
execution and delivery of this Agreement by the Company and the
consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of the
Company and no further action is required by the Company, the Board
or the Company’s stockholders in connection herewith other
than in connection with the Required Approvals. This Agreement has
been duly executed and delivered by the Company and, when delivered
in accordance with the terms hereof, will constitute the valid and
binding obligation of the Company enforceable against the Company
in accordance with its terms, except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and
(iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
(d) No
Conflicts. The
execution, delivery and performance by the Company of this
Agreement, the issuance and sale of the Shares and the consummation
by it of the transactions contemplated hereby do not and will not
(i) conflict with or violate any provision of the Company’s
or any Subsidiary’s certificate or articles of incorporation,
bylaws or other organizational or charter documents, or (ii)
conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under,
result in the creation of any Lien upon any of the properties or
assets of the Company or any Subsidiary, or give to others any
rights of termination, amendment, anti-dilution or similar
adjustments, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or
other instrument (evidencing a Company or Subsidiary debt or
otherwise) or other understanding to which the Company or any
Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected, or (iii) subject to
the Required Approvals, conflict with or result in a violation of
any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which
the Company or a Subsidiary is subject (including federal and state
securities laws and regulations), or by which any property or asset
of the Company or a Subsidiary is bound or affected; except in the
case of each of clauses (ii) and (iii), such as could not have or
reasonably be expected to result in a Material Adverse
Effect.
(e) Filings,
Consents and Approvals. The
Company is not required to obtain any consent, waiver,
authorization or order of, give any notice to, or make any filing
or registration with, any court or other federal, state, local or
other governmental authority or other “Person” (defined
as an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind, including the
Trading Market) in connection with the execution, delivery and
performance by the Company of this Agreement, other than (i) the
filings required by this Agreement, (ii) the filing with the
Commission of the Prospectus Supplement, (iii) the filing of
application(s) to and approval by the Trading Market for the
listing of the Shares for trading thereon in the time and manner
required thereby, and (iv) such filings as are required to be made
under applicable state securities laws and the rules and
regulations of the Financial Industry Regulatory Authority, Inc.
(“FINRA”)
(collectively, the “Required
Approvals”).
10
(f) Issuance
of Shares. The Shares are duly
authorized and, when issued and paid for in accordance with this
Agreement, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company.
The Company has reserved from its duly authorized capital stock a
sufficient number of shares of Common Stock to be issued pursuant
to this Agreement. The issuance by the Company of the Shares has
been registered under the Act and all of the Shares are freely
transferable and tradable by the purchasers thereof without
restriction (other than any restrictions arising solely from an act
or omission of such a purchaser). The Shares are being issued
pursuant to the Registration Statement and the issuance of the
Shares has been registered by the Company under the Act. The
“Plan of
Distribution” section
within the Registration Statement permits the issuance and sale of
the Shares as contemplated by this Agreement. Upon receipt of the
Shares, the purchasers of such Shares will have good and marketable
title to such Shares and the Shares will be freely tradable on the
Trading Market.
(g) Capitalization.
The capitalization of
the Company is as set forth in the SEC Reports. Except for any
Shares issued pursuant to this Agreement, the Company has not
issued any capital stock since its most recently filed periodic report under the
Exchange Act, other than pursuant to the exercise of
employee stock options under the Company’s stock option
plans, the issuance of shares of Common Stock to employees pursuant
to the Company’s employee stock purchase plan and pursuant to
the conversion and/or exercise of securities exercisable,
exchangeable or convertible into Common Stock (“Common Stock
Equivalents”) outstanding as of the date of the most
recently filed periodic report under the Exchange Act. No Person
has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the
transactions contemplated by this Agreement. Except as set forth in
the SEC Reports, there are no outstanding options, warrants, scrip
rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire, any shares of Common
Stock or the capital stock of any Subsidiary, or contracts,
commitments, understandings or arrangements by which the Company or
any Subsidiary is or may become bound to issue additional shares of
Common Stock or Common Stock Equivalents or capital stock of any
Subsidiary. Except as set forth in the SEC Reports, the issuance
and sale of the Shares will not obligate the Company or any
Subsidiary to issue shares of Common Stock or other securities to
any Person. Except as set for in the SEC Reports, there are no
outstanding securities or instruments of the Company or any
Subsidiary with any provision that adjusts the exercise,
conversion, exchange or reset price of such security or instrument
upon an issuance of securities by the Company or any Subsidiary.
Except as set forth in the SEC Reports, there are no outstanding
securities or instruments of the Company or any Subsidiary that
contain any redemption or similar provisions, and there are no
contracts, commitments, understandings or arrangements by which the
Company or any Subsidiary is or may become bound to redeem a
security of the Company or such Subsidiary. The Company does not
have any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement. All of the
outstanding shares of capital stock of the Company are duly
authorized, validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws,
and none of such outstanding shares was issued in violation of any
preemptive rights or similar rights to subscribe for or purchase
securities. Other than the Required Approvals, no further approval
or authorization of any stockholder, the Board or others is
required for the issuance and sale of the Shares. There are no
stockholders agreements, voting agreements or other similar
agreements with respect to the Company’s capital stock to
which the Company is a party or, to the knowledge of the Company,
between or among any of the Company’s
stockholders.
(h) Registration
Statement. The Company meets the requirements for use of
Form S-3 under the Act and has prepared and filed with the
Commission the Registration Statement, including a related Base
Prospectus, for registration under the Act of the offering and sale
of the Shares. Such Registration Statement is effective and
available for the offer and sale of the Shares as of the date
hereof. As filed, the Base Prospectus contains all information
required by the Act and the rules thereunder, and, except to the
extent the Manager shall agree in writing to a modification, shall
be in all substantive respects in the form furnished to the Manager
prior to the Execution Time or prior to any such time this
representation is repeated or deemed to be made. The Registration
Statement, at the Execution Time, each such time this
representation is repeated or deemed to be made, and at all times
during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172, 173
or any similar rule) in connection with any offer or sale of the
Shares, meets the requirements set forth in Rule 415(a)(1)(x).
The initial Effective Date of the Registration Statement was not
earlier than the date three years before the Execution Time. The
Company meets the transaction requirements with respect to the
aggregate market value of securities being sold pursuant to this
offering and during the twelve (12) months prior to this offering,
as set forth in General Instruction I.B.6 of Form S-3, if
applicable.
(i) Accuracy
of Incorporated Documents. The
Incorporated Documents, when they were filed with the Commission,
conformed in all material respects to the requirements of the
Exchange Act and the rules thereunder, and none of the Incorporated
Documents, when they were filed with the Commission, contained any
untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made not misleading; and any
further documents so filed and incorporated by reference in the
Registration Statement, the Base Prospectus, the Prospectus
Supplement or the Prospectus, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act and the rules thereunder, as
applicable, and will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
11
(j) Ineligible
Issuer. (i) At the earliest time after the filing of
the Registration Statement that the Company or another offering
participant made a bona fide offer (within the meaning of
Rule 164(h)(2)) of the Shares and (ii) as of the
Execution Time and on each such time this representation is
repeated or deemed to be made (with such date being used as the
determination date for purposes of this clause (ii)), the
Company was not and is not an Ineligible Issuer (as defined in
Rule 405), without taking account of any determination by the
Commission pursuant to Rule 405 that it is not necessary that
the Company be considered an Ineligible Issuer.
(k) Free
Writing Prospectus. The Company is eligible to use Issuer
Free Writing Prospectuses. Each Issuer Free Writing Prospectus does
not include any information the substance of which conflicts with
the information contained in the Registration Statement, including
any Incorporated Documents and any prospectus supplement deemed to
be a part thereof that has not been superseded or modified; and
each Issuer Free Writing Prospectus does not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The
foregoing sentence does not apply to statements in or omissions
from any Issuer Free Writing Prospectus based upon and in
conformity with written information furnished to the Company by the
Manager specifically for use therein. Any Issuer Free Writing Prospectus
that the Company is required to file
pursuant to Rule 433(d) has been, or will be, filed with the
Commission in accordance with the requirements of the Act and the
rules thereunder. Each Issuer Free Writing Prospectus
that the Company has filed, or is
required to file, pursuant to Rule 433(d) or that was prepared by
or behalf of or used by the Company complies or will comply in all
material respects with the requirements of the Act and the rules
thereunder. The Company will not, without the prior consent of the
Manager, prepare, use or refer to, any Issuer Free Writing
Prospectuses.
(l) Proceedings
Related to Registration Statement. The Registration
Statement is not the subject of a pending proceeding or examination
under Section 8(d) or 8(e) of the Act, and the Company is not
the subject of a pending proceeding under Section 8A of the
Act in connection with the offering of the Shares. The Company has not received any notice that the
Commission has issued or intends to issue a stop-order with respect
to the Registration Statement or that the Commission otherwise has
suspended or withdrawn the effectiveness of the Registration
Statement, either temporarily or permanently, or intends or has
threatened in writing to do so.
(m) SEC
Reports. The Company has
filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Act and the Exchange
Act, including pursuant to Section 13(a) or 15(d) thereof, for the
two years preceding the date hereof (or such shorter period as the
Company was required by law or regulation to file such material)
(the foregoing materials, including the exhibits thereto and
documents incorporated by reference therein, together with the
Prospectus and the Prospectus Supplement, being collectively
referred to herein as the “SEC Reports”) on a timely
basis or has received a valid extension of such time of filing and
has filed any such SEC Reports prior to the expiration of any such
extension. As of their respective dates, the SEC Reports complied
in all material respects with the requirements of the Act and the
Exchange Act, as applicable, and none of the SEC Reports, when
filed, contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The
financial statements of the Company included in the SEC Reports
comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing. Such financial
statements have been prepared in accordance with United States
generally accepted accounting principles applied on a consistent
basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes
thereto and except that unaudited financial statements may not
contain all footnotes required by GAAP, and fairly present in all
material respects the financial position of the Company and its
consolidated Subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.
(n)
[RESERVED]
12
(o) Material
Changes; Undisclosed Events, Liabilities or Developments.
Since the date of the latest audited financial statements included
within the SEC Reports, except as specifically disclosed in a
specific subsequent SEC Report filed prior to the date this
representation is being made, (i) there has been no event,
occurrence or development that has had or that could reasonably be
expected to result in a Material Adverse Effect, (ii) the Company
has not incurred any liabilities (contingent or otherwise) other
than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B)
liabilities not required to be reflected in the Company’s
financial statements pursuant to GAAP or disclosed in filings made
with the Commission, (iii) the Company has not altered its method
of accounting, (iv) the Company has not declared or made any
dividend or distribution of cash or other property to its
stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock and (v) the
Company has not issued any equity securities to any officer,
director or “Affiliate” (defined as any Person that, directly or
indirectly through one or more intermediaries, controls or is
controlled by or is under common control with a Person, as such
terms are used in and construed under Rule 144 under the
Act), except pursuant to existing Company stock option
plans. The Company does not have pending before the Commission any
request for confidential treatment of information. Except for the
issuance of the Shares contemplated by this Agreement or as set
forth in the SEC Reports, no event, liability, fact, circumstance,
occurrence or development has occurred or exists or is reasonably
expected to occur or exist with respect to the Company or its
Subsidiaries or their respective businesses, prospects, properties,
operations, assets or financial condition that would be required to
be disclosed by the Company under applicable securities laws at the
time this representation is made or deemed made that has not been
publicly disclosed at least 1 Trading Day prior to the date that
this representation is made.
(p) Litigation.
Except as set forth in the SEC Reports, there is no action, suit,
inquiry, notice of violation, proceeding or investigation pending
or, to the knowledge of the Company, threatened against or
affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or
administrative agency or regulatory authority (federal, state,
county, local or foreign) (collectively, an “Action”) that (i)
adversely affects or challenges the legality, validity or
enforceability of this Agreement or the Shares or (ii) could, if
there were an unfavorable decision, have or reasonably be expected
to result in a Material Adverse Effect. Neither the Company nor any
Subsidiary, nor, to the knowledge of the Company, any director or
officer thereof, is or has been the subject of any Action involving
a claim of violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty. There has
not been, and to the knowledge of the Company, there is not pending
or contemplated, any investigation by the Commission involving the
Company or any current or former director or officer of the
Company. The Commission has not issued any stop order or other
order suspending the effectiveness of any registration statement
filed by the Company or any Subsidiary under the Exchange Act or
the Act.
13
(q) Labor
Relations. No labor
dispute exists or, to the knowledge of the Company, is imminent
with respect to any of the employees of the Company, which could
reasonably be expected to result in a Material Adverse Effect. None
of the Company’s or its Subsidiaries’ employees is a
member of a union that relates to such employee’s
relationship with the Company or such Subsidiary, and neither the
Company nor any of its Subsidiaries is a party to a collective
bargaining agreement, and the Company and its Subsidiaries believe
that their relationships with their employees are good. To the
knowledge of the Company, no executive officer of the Company or
any Subsidiary, is, or is now expected to be, in violation of any
material term of any employment contract, confidentiality,
disclosure or proprietary information agreement or non-competition
agreement, or any other contract or agreement or any restrictive
covenant in favor of any third party, and the continued employment
of each such executive officer does not subject the Company or any
of its Subsidiaries to any liability with respect to any of the
foregoing matters. The Company and its Subsidiaries are in
compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms
and conditions of employment and wages and hours, except where the
failure to be in compliance could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
(r) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or
in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a
default by the Company or any Subsidiary under), nor has the
Company or any Subsidiary received notice of a claim that it is in
default under or that it is in violation of, any indenture, loan or
credit agreement or any other agreement or instrument to which it
is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is
in violation of any judgment, decree or order of any court,
arbitrator or other governmental authority or (iii) is or has been
in violation of any statute, rule, ordinance or regulation of any
governmental authority, including without limitation all foreign,
federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and
safety and employment and labor matters, except in each case as
could not have or reasonably be expected to result in a Material
Adverse Effect.
(s) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance
with all federal, state, local and foreign laws relating to
pollution or protection of human health or the environment
(including ambient air, surface water, groundwater, land surface or
subsurface strata), including laws relating to emissions,
discharges, releases or threatened releases of chemicals,
pollutants, contaminants, or toxic or hazardous substances or
wastes (collectively, “Hazardous Materials”)
into the environment, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, as well as all
authorizations, codes, decrees, demands, or demand letters,
injunctions, judgments, licenses, notices or notice letters,
orders, permits, plans or regulations, issued, entered, promulgated
or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required
of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms
and conditions of any such permit, license or approval where in
each clause (i), (ii) and (iii), the failure to so comply could be
reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect.
14
(t) Regulatory
Permits. The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary
to conduct their respective businesses as described in the SEC
Reports, except where the failure to possess such permits could not
reasonably be expected to result in a Material Adverse Effect
(“Material
Permits”), and neither the Company nor any Subsidiary
has received any notice of proceedings relating to the revocation
or modification of any Material Permit.
(u) Title
to Assets. The Company
and the Subsidiaries have good and marketable title in fee simple
to all real property owned by them and good and marketable title in
all personal property owned by them that is material to the
business of the Company and the Subsidiaries, in each case free and
clear of all Liens, except for (i) Liens as do not materially
affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the
Company and the Subsidiaries and (ii) Liens for the payment of
federal, state or other taxes, for which appropriate reserves have
been made therefor in accordance with GAAP and, the payment of
which is neither delinquent nor subject to penalties. Any real
property and facilities held under lease by the Company and the
Subsidiaries are held by them under valid, subsisting and
enforceable leases with which the Company and the Subsidiaries are
in compliance, except where such non-compliance would not have or
reasonably be expected to have a Material Adverse
Effect.
(v)
Intellectual
Property. The Company
and the Subsidiaries have, or have rights to use, all patents,
patent applications, trademarks, trademark applications, service
marks, trade names, trade secrets, inventions, copyrights, licenses
and other intellectual property rights and similar rights necessary
or required for use in connection with their respective businesses
as described in the SEC Reports and which the failure to so have
could have a Material Adverse Effect (collectively, the
“Intellectual
Property Rights”). None of, and neither the Company
nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this
Agreement. Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included
within the SEC Reports, a written notice of a claim or otherwise
has any knowledge that the Intellectual Property Rights violate or
infringe upon the rights of any Person, except as could not have or
reasonably be expected to not have a Material Adverse Effect. To
the knowledge of the Company, all such Intellectual Property Rights
are enforceable and to the knowledge of the Company, there is no
existing infringement by another Person of any of the Intellectual
Property Rights. The Company and its Subsidiaries have taken
reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties,
except where failure to do so could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
15
(w) Insurance.
The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary for companies of
similar size as the Company in the businesses in which the Company
and the Subsidiaries are engaged, including, but not limited to,
directors and officers insurance coverage. Neither the Company nor
any Subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant
increase in cost.
(x) Affiliate
Transactions. Except as
set forth in the SEC Reports, none of the officers or directors of
the Company or any Subsidiary and, to the knowledge of the Company,
none of the employees of the Company or any Subsidiary is presently
a party to any transaction with the Company or any Subsidiary
(other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing
for the furnishing of services to or by, providing for rental of
real or personal property to or from, providing for the borrowing
of money from or lending of money to or otherwise requiring
payments to or from any officer, director or such employee or, to
the knowledge of the Company, any entity in which any officer,
director, or any such employee has a substantial interest or is an
officer, director, trustee, stockholder, member or partner, in each
case in excess of $120,000 other than for (i) payment of salary or
consulting fees for services rendered, (ii) reimbursement for
expenses incurred on behalf of the Company and (iii) other employee
benefits, including stock option agreements under any stock option
plan of the Company.
(y) Sarbanes
Oxley Compliance. Except as
disclosed in the SEC Reports, the Company and the
Subsidiaries are in material compliance with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002 that are effective
as of the date hereof, and any and all applicable rules and
regulations promulgated by the Commission thereunder that are
effective as of the date hereof. The
Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance
that: (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with GAAP and to maintain asset
accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific
authorization, and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. The
Company and the Subsidiaries have established disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) for the Company and the Subsidiaries and designed such
disclosure controls and procedures to ensure that information
required to be disclosed by the Company in the reports it files or
submits under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the
Commission’s rules and forms. The Company’s certifying
officers have evaluated the effectiveness of the disclosure
controls and procedures of the Company and the Subsidiaries as of
the end of the period covered by the most recently filed periodic
report under the Exchange Act (such date, the
“Evaluation
Date”). The Company
presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on
their evaluations as of the Evaluation Date. Since the Evaluation
Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act)
of the Company and its Subsidiaries that have materially affected,
or is reasonably likely to materially affect, the internal control
over financial reporting of the Company and its
Subsidiaries.
16
(z) Certain
Fees. Other than payments to be made to the Manager, no
brokerage or finder’s fees or commissions are or will be
payable by the Company or any Subsidiary to any broker, financial
advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated
by this Agreement. The Manager shall have no obligation with
respect to any fees or with respect to any claims made by or on
behalf of other Persons for fees of a type contemplated in this
Section that may be due in connection with the transactions
contemplated by this Agreement.
(aa) No
Other Sales Agency Agreement. The Company has not entered
into any other sales agency agreements or other similar
arrangements with any agent or any other representative in respect
of at the market offerings of the Shares.
(bb) [RESERVED]
(cc) Listing
and Maintenance Requirements. The Common Stock is listed on
the Trading Market and the issuance of the Shares as contemplated
by this Agreement does not contravene the rules and regulations of
the Trading Market. The Common Stock is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act, and the Company has
taken no action designed to, or which to its knowledge is likely to
have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such
registration. Except as disclosed in the SEC Reports, the Company
has not, in the 12 months preceding the date hereof, received
notice from any Trading Market on which the Common Stock is or has
been listed or quoted to the effect that the Company is not in
compliance with the listing or maintenance requirements of such
Trading Market. Except as disclosed in the SEC Reports, the Company
is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such
listing and maintenance requirements. The Common Stock is currently
eligible for electronic transfer through the Depository Trust
Company or another established clearing corporation and the Company
is current in payment of the fees to the Depository Trust Company
(or such other established clearing corporation) in connection with
such electronic transfer.
17
(dd) Application
of Takeover Protections. Except as set forth in the
Registration Statement, the Base Prospectus, any Prospectus
Supplement or the Prospectus, the Company and the Board have taken
all necessary action, if any, in order to render inapplicable any
control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other
similar anti-takeover provision under the Company’s
certificate of incorporation (or similar charter documents) or the
laws of its state of incorporation that is or could become
applicable to the Shares.
(ee) Solvency.
Based on the consolidated financial condition of the Company as of
the Effective Date, (i) the fair saleable value of the
Company’s assets exceeds the amount that will be required to
be paid on or in respect of the Company’s existing debts and
other liabilities (including known contingent liabilities) as they
mature, (ii) the Company’s assets do not constitute
unreasonably small capital to carry on its business as now
conducted and as proposed to be conducted including its capital
needs taking into account the particular capital requirements of
the business conducted by the Company, consolidated and projected
capital requirements and capital availability thereof, and (iii)
the current cash flow of the Company, together with the proceeds
the Company would receive, were it to liquidate all of its assets,
after taking into account all anticipated uses of the cash, would
be sufficient to pay all amounts on or in respect of its
liabilities when such amounts are required to be paid. The Company
does not intend to incur debts beyond its ability to pay such debts
as they mature (taking into account the timing and amounts of cash
to be payable on or in respect of its debt). The Company has no
knowledge of any facts or circumstances which lead it to believe
that it will file for reorganization or liquidation under the
bankruptcy or reorganization laws of any jurisdiction within one
year from the date hereof. The SEC Reports set forth as of the
dates thereof all outstanding secured and unsecured Indebtedness of
the Company or any Subsidiary, or for which the Company or any
Subsidiary has commitments. For the purposes of this Agreement,
“Indebtedness” means (x)
any liabilities for borrowed money or amounts owed in excess of
$50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other
contingent obligations in respect of indebtedness of others,
whether or not the same are or should be reflected in the
Company’s consolidated balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary
course of business; and (z) the present value of any lease payments
in excess of $50,000 due under leases required to be capitalized in
accordance with GAAP. Neither the Company nor any Subsidiary is in
default with respect to any Indebtedness.
18
(ff) Tax
Status. Except for matters that would not, individually or
in the aggregate, have or reasonably be expected to result in a
Material Adverse Effect, the Company and its Subsidiaries each (i)
has made or filed all United States federal, state and local income
and all foreign income and franchise tax returns, reports and
declarations required by any jurisdiction to which it is subject,
(ii) has paid all taxes and other governmental assessments and
charges that are material in amount, shown or determined to be due
on such returns, reports and declarations and (iii) has set aside
on its books provision reasonably adequate for the payment of all
material taxes for periods subsequent to the periods to which such
returns, reports or declarations apply. There are no unpaid taxes
in any material amount claimed to be due by the taxing authority of
any jurisdiction, and the officers of the Company or of any
Subsidiary know of no basis for any such claim.
(gg) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary,
nor to the knowledge of the Company or any Subsidiary, any agent or
other person acting on behalf of the Company or any Subsidiary, has
(i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses
related to foreign or domestic political activity, (ii) made any
unlawful payment to foreign or domestic government officials or
employees or to any foreign or domestic political parties or
campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company or any Subsidiary (or made by any
person acting on its behalf of which the Company is aware) which is
in violation of law, or (iv) violated in any material respect any
provision of the Foreign Corrupt Practices Act of 1977, as
amended.
(hh) Accountants.
The Company’s accounting firm is set forth in the SEC
Reports. To the knowledge and belief of the Company, such
accounting firm (i) is a registered public accounting firm as
required by the Exchange Act and (ii) shall express its opinion
with respect to the financial statements to be included in the
Company’s Annual Report for the fiscal year ending December
31, 2021.
(ii) Regulation
M Compliance. The Company has not, and to its
knowledge no one acting on its behalf has, (i) taken, directly or
indirectly, any action designed to cause or to result in the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Shares, (ii)
sold, bid for, purchased, or, paid any compensation for soliciting
purchases of, any of the Shares, or (iii) paid or agreed to pay to
any Person any compensation for soliciting another to purchase any
other securities of the Company, other than, in the case of clauses
(ii) and (iii), compensation paid to the Manager in connection with
the Shares.
19
(jj) FDA.
As to each product subject to the jurisdiction of the U.S. Food and
Drug Administration (“FDA”) under the Federal
Food, Drug and Cosmetic Act, as amended, and the regulations
thereunder (“FDCA”) that is
manufactured, packaged, labeled, tested, distributed, sold, and/or
marketed by the Company or any of its Subsidiaries (each such
product, a “Pharmaceutical Product”),
such Pharmaceutical Product is being manufactured, packaged,
labeled, tested, distributed, sold and/or marketed by the Company
in compliance with all applicable requirements under FDCA and
similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application
approval, good manufacturing practices, good laboratory practices,
good clinical practices, product listing, quotas, labeling,
advertising, record keeping and filing of reports, except where the
failure to be in compliance would not have a Material Adverse
Effect. There is no pending, completed or, to the Company's
knowledge, threatened, action (including any lawsuit, arbitration,
or legal or administrative or regulatory proceeding, charge,
complaint, or investigation) against the Company or any of its
Subsidiaries, and none of the Company or any of its Subsidiaries
has received any notice, warning letter or other communication from
the FDA or any other governmental entity, which (i) contests the
premarket clearance, licensure, registration, or approval of, the
uses of, the distribution of, the manufacturing or packaging of,
the testing of, the sale of, or the labeling and promotion of any
Pharmaceutical Product, (ii) withdraws its approval of, requests
the recall, suspension, or seizure of, or withdraws or orders the
withdrawal of advertising or sales promotional materials relating
to, any Pharmaceutical Product, (iii) imposes a clinical hold on
any clinical investigation by the Company or any of its
Subsidiaries, (iv) enjoins production at any facility of the
Company or any of its Subsidiaries, (v) enters or proposes to enter
into a consent decree of permanent injunction with the Company or
any of its Subsidiaries, or (vi) otherwise alleges any violation of
any laws, rules or regulations by the Company or any of its
Subsidiaries, and which, either individually or in the aggregate,
would have a Material Adverse Effect. The properties, business and
operations of the Company have been and are being conducted in all
material respects in accordance with all applicable laws, rules and
regulations of the FDA. The Company has not been informed by
the FDA that the FDA will prohibit the marketing, sale, license or
use in the United States of any product proposed to be developed,
produced or marketed by the Company nor has the FDA expressed any
concern as to approving or clearing for marketing any product being
developed or proposed to be developed by the Company.
(kk) Stock
Option Plans. Except as set forth in the SEC Reports, each
stock option granted by the Company under the Company’s stock
option plan was granted (i) in accordance with the terms of the
Company’s stock option plan and (ii) with an exercise price
at least equal to the fair market value of the Common Stock on the
date such stock option would be considered granted under GAAP and
applicable law. No stock option granted under the Company’s
stock option plan has been backdated. The Company has not knowingly
granted, and there is no and has been no Company policy or practice
to knowingly grant, stock options prior to, or otherwise knowingly
coordinate the grant of stock options with, the release or other
public announcement of material information regarding the Company
or its Subsidiaries or their financial results or
prospects.
(ll) Office
of Foreign Assets Control. Neither the Company nor any
Subsidiary nor, to the Company's knowledge, any director, officer,
agent, employee or affiliate of the Company or any Subsidiary is
currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”).
(mm) U.S.
Real Property Holding Corporation. The Company is not and
has never been a U.S. real property holding corporation within the
meaning of Section 897 of the Internal Revenue Code of 1986, as
amended, and the Company shall so certify upon the Manager’s
request.
(nn) Bank
Holding Company Act. Neither the Company nor any of its
Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation
by the Board of Governors of the Federal Reserve System (the
“Federal
Reserve”). Neither the Company nor any of its
Subsidiaries or Affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of
any class of voting securities or twenty-five percent or more of
the total equity of a bank or any entity that is subject to the
BHCA and to regulation by the Federal Reserve. Neither the Company
nor any of its Subsidiaries or Affiliates exercises a controlling
influence over the management or policies of a bank or any entity
that is subject to the BHCA and to regulation by the Federal
Reserve.
20
(oo) Money
Laundering. The operations of the Company and its
Subsidiaries are and have been conducted at all times in compliance
with applicable financial record-keeping and reporting requirements
of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, applicable money laundering statutes and applicable rules
and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company
or any Subsidiary with respect to the Money Laundering Laws is
pending or, to the knowledge of the Company or any Subsidiary,
threatened.
(pp) FINRA
Member Shareholders. There are
no affiliations with any FINRA member firm among the
Company’s officers, directors or, to the knowledge of the
Company, any five percent (5%) or greater stockholder of the
Company, except as set forth in the Registration Statement, the
Base Prospectus, any Prospectus Supplement or the
Prospectus.
4. Agreements.
The Company agrees with the Manager that:
(a) Right
to Review Amendments and Supplements to Registration Statement and
Prospectus. During any period when the delivery of a
prospectus relating to the Shares is required (including in
circumstances where such requirement may be satisfied pursuant to
Rule 172, 173 or any similar rule) to be delivered under the
Act in connection with the offering or the sale of Shares, the
Company will not file any amendment to the Registration Statement
or supplement (including any Prospectus Supplement) to the Base
Prospectus unless the Company has furnished to the Manager a copy
for its review prior to filing and will not file any such proposed
amendment or supplement to which the Manager reasonably objects.
The Company will properly cause any supplement to the Prospectus
filed after the Effective Time to be properly completed, in a form
approved by the Manager, and will file such supplement with the
Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed thereby and will provide evidence
reasonably satisfactory to the Manager of such timely filing. The
Company will promptly advise the Manager (i) when the
Prospectus, and any supplement thereto, shall have been filed (if
required) with the Commission pursuant to Rule 424(b),
(ii) when, during any period when the delivery of a prospectus
(whether physically or through compliance with Rule 172, 173
or any similar rule) is required under the Act in connection with
the offering or sale of the Shares, any amendment to the
Registration Statement shall have been filed or become effective
(other than any annual report of the Company filed pursuant to
Section 13(a) or 15(d) of the Exchange Act), (iii) of any
request by the Commission or its staff for any amendment of the
Registration Statement, or any Rule 462(b) Registration Statement,
or for any supplement to the Prospectus or for any additional
information, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration
Statement or of any notice objecting to its use or the institution
or threatening of any proceeding for that purpose and (v) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Shares for sale in any
jurisdiction or the institution or threatening of any proceeding
for such purpose. The Company will use its best efforts to prevent
the issuance of any such stop order or the occurrence of any such
suspension or objection to the use of the Registration Statement
and, upon such issuance, occurrence or notice of objection, to
obtain as soon as possible the withdrawal of such stop order or
relief from such occurrence or objection, including, if necessary,
by filing an amendment to the Registration Statement or a new
registration statement and using its best efforts to have such
amendment or new registration statement declared effective as soon
as practicable.
21
(b) Subsequent
Events. If, at any time on or after an Applicable Time but
prior to the related Settlement Date, any event occurs as a result
of which the Registration Statement or Prospectus would include any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made or the circumstances then
prevailing not misleading, the Company will (i) notify
promptly the Manager so that any use of the Registration Statement
or Prospectus may cease until such are amended or supplemented;
(ii) amend or supplement the Registration Statement or
Prospectus to correct such statement or omission; and
(iii) supply any amendment or supplement to the Manager in
such quantities as the Manager may reasonably request.
(c) Notification
of Subsequent Filings. During any period when the delivery
of a prospectus relating to the Shares is required (including in
circumstances where such requirement may be satisfied pursuant to
Rule 172, 173 or any similar rule) to be delivered under the
Act, any event occurs as a result of which the Prospectus as then
supplemented would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were
made not misleading, or if it shall be necessary to amend the
Registration Statement, file a new registration statement or
supplement the Prospectus to comply with the Act or the Exchange
Act or the respective rules thereunder, including in connection
with use or delivery of the Prospectus, the Company promptly will
(i) notify the Manager of any such event, (ii) subject to
Section 4(a), prepare and file with the Commission an amendment or
supplement or new registration statement which will correct such
statement or omission or effect such compliance, (iii) use its
best efforts to have any amendment to the Registration Statement or
new registration statement declared effective as soon as
practicable in order to avoid any disruption in use of the
Prospectus and (iv) supply any supplemented Prospectus to the
Manager in such quantities as the Manager may reasonably
request.
(d) Earnings
Statements. As soon as practicable, the Company will make
generally available to its security holders and to the Manager an
earnings statement or statements of the Company and its
Subsidiaries which will satisfy the provisions of
Section 11(a) of the Act and Rule 158. For the avoidance
of doubt, the Company’s compliance with the reporting
requirements of the Exchange Act shall be deemed to satisfy the
requirements of this Section 4(d).
(e) Delivery
of Registration Statement. Upon the request of the Manager,
the Company will furnish to the Manager and counsel for the
Manager, without charge, signed copies of the Registration
Statement (including exhibits thereto) and, so long as delivery of
a prospectus by the Manager or dealer may be required by the Act
(including in circumstances where such requirement may be satisfied
pursuant to Rule 172, 173 or any similar rule), as many copies
of the Prospectus and each Issuer Free Writing Prospectus and any
supplement thereto as the Manager may reasonably request. The
Company will pay the expenses of printing or other production of
all documents relating to the offering.
22
(f) Qualification
of Shares. The Company will arrange, if necessary, for the
qualification of the Shares for sale under the laws of such
jurisdictions as the Manager may designate and will maintain such
qualifications in effect so long as required for the distribution
of the Shares; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action that would subject it to
service of process in suits, other than those arising out of the
offering or sale of the Shares, in any jurisdiction where it is not
now so subject.
(g) Free
Writing Prospectus. The Company agrees that, unless it has
or shall have obtained the prior written consent of the Manager,
and the Manager agrees with the Company that, unless it has or
shall have obtained, as the case may be, the prior written consent
of the Company, it has not made and will not make any offer
relating to the Shares that would constitute an Issuer Free Writing
Prospectus or that would otherwise constitute a “free writing
prospectus” (as defined in Rule 405) required to be
filed by the Company with the Commission or retained by the Company
under Rule 433. Any such free writing prospectus consented to
by the Manager or the Company is hereinafter referred to as a
“Permitted Free
Writing Prospectus.” The Company agrees that
(i) it has treated and will treat, as the case may be, each
Permitted Free Writing Prospectus as an Issuer Free Writing
Prospectus and (ii) it has complied and will comply, as the
case may be, with the requirements of Rules 164 and 433
applicable to any Permitted Free Writing Prospectus, including in
respect of timely filing with the Commission, legending and record
keeping.
(h) Subsequent
Equity Issuances. The Company shall not deliver any Sales
Notice hereunder (and any Sales Notice previously delivered shall
not apply during such three Business Days) for at least three (3)
Business Days prior to any date on which the Company or any
Subsidiary offers, sells, issues, contracts to sell, contracts to
issue or otherwise disposes of, directly or indirectly, any other
shares of Common Stock or any Common Stock Equivalents (other than
the Shares), subject to Manager’s right to waive this
obligation, provided that, without compliance with the foregoing
obligation, the Company may issue and sell Common Stock pursuant to
any employee equity plan, stock ownership plan or dividend
reinvestment plan of the Company in effect at the Execution Time
and the Company may issue Common Stock issuable upon the conversion
or exercise of Common Stock Equivalents outstanding for at least
three (3) Business Days prior to the delivery of any Sales
Notice.
(i) Market
Manipulation. Until the termination of this Agreement, the
Company will not take, directly or indirectly, any action designed
to or that would constitute or that might reasonably be expected to
cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation in violation of the Act, Exchange Act
or the rules and regulations thereunder of the price of any
security of the Company to facilitate the sale or resale of the
Shares or otherwise violate any provision of Regulation M under the
Exchange Act.
23
(j) Notification
of Incorrect Certificate. The Company will, at any time
during the term of this Agreement, as supplemented from time to
time, advise the Manager immediately after it shall have received
notice or obtained knowledge thereof, of any information or fact
that would alter or affect any opinion, certificate, letter and
other document provided to the Manager pursuant to Section 6
herein.
(k) Certification
of Accuracy of Disclosure. Upon commencement of the offering
of the Shares under this Agreement (and upon the recommencement of
the offering of the Shares under this Agreement following the
termination of a suspension of sales hereunder lasting more than 30
Trading Days), and each time that (i) the Registration Statement or
Prospectus shall be amended or supplemented, other than by means of
Incorporated Documents, (ii) the Company files its Annual Report on
Form 10-K under the Exchange Act, (iii) the Company files its
quarterly reports on Form 10-Q under the Exchange Act, (iv) the
Company files a Current Report on Form 8-K containing amended
financial information (other than information that is furnished and
not filed), if the Manager reasonably determines that the
information in such Form 8-K is material, or (v) the Shares are
delivered to the Manager as principal at the Time of Delivery
pursuant to a Terms Agreement (such commencement or recommencement
date and each such date referred to in (i), (ii), (iii), (iv) and
(v) above, a “Representation Date”),
unless waived by the Manager, the Company shall furnish or cause to
be furnished to the Manager forthwith a certificate dated and
delivered on the Representation Date, in form reasonably
satisfactory to the Manager to the effect that the statements
contained in the certificate referred to in Section 6 of this
Agreement which were last furnished to the Manager are true and
correct at the Representation Date, as though made at and as of
such date (except that such statements shall be deemed to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in
said Section 6, modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the
date of delivery of such certificate.
(l) Bring
Down Opinions; Negative Assurance. At each Representation
Date, unless waived by the Manager, the Company shall furnish or
cause to be furnished forthwith to the Manager and to counsel to
the Manager a written opinion of counsel to the Company
(“Company
Counsel”) addressed to the Manager and dated and
delivered on such Representation Date, in form and substance
reasonably satisfactory to the Manager, including a negative
assurance representation. The requirement to furnish or cause to be
furnished an opinion (but not with respect to a negative assurance
representation) under this Section 4(l) shall be waived for any
Representation Date other than a Representation Date on which a
material amendment to the Registration Statement or Prospectus is
made or the Company files its Annual Report on Form 10-K or a
material amendment thereto under the Exchange Act, unless the
Manager reasonably requests such deliverable required this Section
4(l) in connection with a Representation Date, upon which request
such deliverable shall be deliverable hereunder.
24
(m) Auditor
Bring Down “Comfort” Letter. At each
Representation Date, unless waived by the Manager, the Company
shall cause (1) the Company’s auditors (the
“Accountants”), or other
independent accountants satisfactory to the Manager forthwith to
furnish the Manager a letter, and (2) the Chief Financial
Officer of the Company forthwith to furnish the Manager a
certificate, in each case dated on such Representation Date, in
form satisfactory to the Manager, of the same tenor as the letters
and certificate referred to in Section 6 of this Agreement but
modified to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such letters
and certificate. The requirement to furnish or cause to be
furnished a “comfort” letter under this Section 4(m)
shall be waived for any Representation Date other than a
Representation Date on which a material amendment to the
Registration Statement or Prospectus is made or the Company files
its Annual Report on Form 10-K or a material amendment thereto
under the Exchange Act, unless the Manager reasonably requests the
deliverables required by this Section 4(m) in connection with a
Representation Date, upon which request such deliverable shall be
deliverable hereunder.
(n) Due
Diligence Session. Upon commencement of the offering of the
Shares under this Agreement (and upon the recommencement of the
offering of the Shares under this Agreement following the
termination of a suspension of sales hereunder lasting more than 30
Trading Days), and at each Representation Date, the Company will
conduct a due diligence session, in form and substance, reasonably
satisfactory to the Manager, which shall include representatives of
management and Accountants. The Company shall cooperate timely with
any reasonable due diligence request from or review conducted by
the Manager or its agents from time to time in connection with the
transactions contemplated by this Agreement, including, without
limitation, providing information and available documents and
access to appropriate corporate officers and the Company’s
agents during regular business hours, and timely furnishing or
causing to be furnished such certificates, letters and opinions
from the Company, its officers and its agents, as the Manager may
reasonably request. The Company shall reimburse the Manager for
Manager’s counsel’s fees in each such due diligence
update session, up to a maximum of $2,500 per update, plus any
reasonable and customary incidental expense incurred by the Manager
in connection therewith.
(o) Acknowledgment
of Trading. The Company consents to the Manager trading in
the Common Stock for the Manager’s own account and for the
account of its clients at the same time as sales of the Shares
occur pursuant to this Agreement or pursuant to a Terms
Agreement.
25
(p) Disclosure
of Shares Sold. The Company will disclose in its Annual
Reports on Form 10-K and Quarterly Reports on Form 10-Q,
as applicable, the number of Shares sold through the Manager under
this Agreement, the Net Proceeds to the Company and the
compensation paid by the Company with respect to sales of Shares
pursuant to this Agreement during the relevant quarter; and, if
required by any subsequent change in Commission policy or request,
more frequently by means of a Current Report on Form 8-K or a
further Prospectus Supplement.
(q) Rescission
Right. If to the knowledge of the Company, the conditions
set forth in Section 6 shall not have been satisfied as of the
applicable Settlement Date, the Company will offer to any person
who has agreed to purchase Shares from the Company as the result of
an offer to purchase solicited by the Manager the right to refuse
to purchase and pay for such Shares.
(r) Bring
Down of Representations and Warranties. Each acceptance by
the Company of an offer to purchase the Shares hereunder, and each
execution and delivery by the Company of a Terms Agreement, shall
be deemed to be an affirmation to the Manager that the
representations and warranties of the Company contained in or made
pursuant to this Agreement are true and correct as of the date of
such acceptance or of such Terms Agreement as though made at and as
of such date, and an undertaking that such representations and
warranties will be true and correct as of the Settlement Date for
the Shares relating to such acceptance or as of the Time of
Delivery relating to such sale, as the case may be, as though made
at and as of such date (except that such representations and
warranties shall be deemed to relate to the Registration Statement
and the Prospectus as amended and supplemented relating to such
Shares).
(s) Reservation
of Shares. The Company shall ensure that there are at all
times sufficient shares of Common Stock to provide for the
issuance, free of any preemptive rights, out of its authorized but
unissued shares of Common Stock or shares of Common Stock held in
treasury, of the maximum aggregate number of Shares authorized for
issuance by the Board pursuant to the terms of this Agreement. The
Company will use its commercially reasonable efforts to cause the
Shares to be listed for trading on the Trading Market and to
maintain such listing.
(t) Obligation
Under Exchange Act. During any period when the delivery of a
prospectus relating to the Shares is required (including in
circumstances where such requirement may be satisfied pursuant to
Rule 172, 173 or any similar rule) to be delivered under the
Act, the Company will file all documents required to be filed with
the Commission pursuant to the Exchange Act within the time periods
required by the Exchange Act and the regulations
thereunder.
26
(u) DTC
Facility. The Company shall cooperate with Manager and use
its reasonable efforts to permit the Shares to be eligible for
clearance and settlement through the facilities of
DTC.
(v) Use
of Proceeds. The Company will apply the Net Proceeds from
the sale of the Shares in the manner set forth in the
Prospectus.
(w) Filing
of Prospectus Supplement. If any sales are made pursuant to
this Agreement which are not made in “at the market”
offerings as defined in Rule 415, including, without limitation,
any Placement pursuant to a Terms Agreement, the Company shall file
a Prospectus Supplement describing the terms of such transaction,
the amount of Shares sold, the price thereof, the Manager’s
compensation, and such other information as may be required
pursuant to Rule 424 and Rule 430B, as applicable, within the time
required by Rule 424.
(x) Additional
Registration Statement. To the extent that the Registration
Statement is not available for the sales of the Shares as
contemplated by this Agreement, the Company shall file a new
registration statement with respect to any additional shares of
Common Stock necessary to complete such sales of the Shares and
shall cause such registration statement to become effective as
promptly as practicable. After the effectiveness of any such
registration statement, all references to “Registration Statement”
included in this Agreement shall be deemed to include such new
registration statement, including all documents incorporated by
reference therein pursuant to Item 12 of Form S-3, and all
references to “Base
Prospectus” included in this Agreement shall be deemed
to include the final form of prospectus, including all documents
incorporated therein by reference, included in any such
registration statement at the time such registration statement
became effective.
5. Payment
of Expenses. The Company agrees to pay the costs and
expenses incident to the performance of its obligations under this
Agreement, whether or not the transactions contemplated hereby are
consummated, including without limitation: (i) the
preparation, printing or reproduction and filing with the
Commission of the Registration Statement (including financial
statements and exhibits thereto), the Prospectus and each Issuer
Free Writing Prospectus, and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery
(including postage, air freight charges and charges for counting
and packaging) of such copies of the Registration Statement, the
Prospectus, and each Issuer Free Writing Prospectus, and all
amendments or supplements to any of them, as may, in each case, be
reasonably requested for use in connection with the offering and
sale of the Shares; (iii) the preparation, printing,
authentication, issuance and delivery of certificates for the
Shares, including any stamp or transfer taxes in connection with
the original issuance and sale of the Shares; (iv) the
printing (or reproduction) and delivery of this Agreement, any blue
sky memorandum and all other agreements or documents printed (or
reproduced) and delivered in connection with the offering of the
Shares; (v) the registration of the Shares under the Exchange
Act, if applicable, and the listing of the Shares on the Trading
Market; (vi) any registration or qualification of the Shares
for offer and sale under the securities or blue sky laws of the
several states (including filing fees and the reasonable fees and
expenses of counsel for the Manager relating to such registration
and qualification); (vii) the transportation and other
expenses incurred by or on behalf of Company representatives in
connection with presentations to prospective purchasers of the
Shares; (viii) the fees and expenses of the Company’s
accountants and the fees and expenses of counsel (including local
and special counsel) for the Company; (ix) the filing fee under
FINRA Rule 5110; (x) the reasonable fees and expenses of the
Manager’s counsel, not to exceed $50,000 (excluding any
periodic due diligence fees provided for under Section 4(n)), which
shall be paid upon the Execution Time; and (xi) all other costs and
expenses incident to the performance by the Company of its
obligations hereunder.
27
6. Conditions
to the Obligations of the Manager. The obligations of the
Manager under this Agreement and any Terms Agreement shall be
subject to (i) the accuracy of the representations and
warranties on the part of the Company contained herein as of the
Execution Time, each Representation Date, and as of each Applicable
Time, Settlement Date and Time of Delivery, (ii) the
performance by the Company of its obligations hereunder and
(iii) the following additional conditions:
(a) Effectiveness
of the Registration Statement; Filing of Prospectus
Supplement. The Registration Statement shall have been
declared effective by the Commission and the Prospectus, and any
supplement thereto, required by Rule 424 to be filed with the
Commission have been filed in the manner and within the time period
required by Rule 424(b) with respect to any sale of Shares;
each Prospectus Supplement shall have been filed in the manner
required by Rule 424(b) within the time period required
hereunder and under the Act; any other material required to be
filed by the Company pursuant to Rule 433(d) under the Act,
shall have been filed with the Commission within the applicable
time periods prescribed for such filings by Rule 433; and no
stop order suspending the effectiveness of the Registration
Statement or any notice objecting to its use shall have been issued
and no proceedings for that purpose shall have been instituted or
threatened.
(b) Delivery
of Opinion. The Company shall have caused the Company
Counsel to furnish to the Manager its opinion and negative
assurance statement, dated as of such date and addressed to the
Manager in form and substance acceptable to the
Manager.
(c) Delivery
of Officer’s Certificate. The Company shall have
furnished or caused to be furnished to the Manager a certificate of
the Company signed by the Chief Executive Officer or the President
and the principal financial or accounting officer of the Company,
dated as of such date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the
Prospectus, any Prospectus Supplement and any documents
incorporated by reference therein and any supplements or amendments
thereto and this Agreement and that:
28
(i) the
representations and warranties of the Company in this Agreement are
true and correct on and as of such date with the same effect as if
made on such date and the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to such date;
(ii) no
stop order suspending the effectiveness of the Registration
Statement or any notice objecting to its use has been issued and no
proceedings for that purpose have been instituted or, to the
Company’s knowledge, threatened; and
(iii) since
the date of the most recent financial statements included in the
Registration Statement, the Prospectus and the Incorporated
Documents, there has been no Material Adverse Effect on the
condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the
Registration Statement and the Prospectus.
(d) Delivery
of Accountants’ “Comfort” Letter. The
Company shall have requested and caused the Accountants to have
furnished to the Manager letters (which may refer to letters
previously delivered to the Manager), dated as of such date, in
form and substance satisfactory to the Manager, confirming that
they are independent accountants within the meaning of the Act and
the Exchange Act and the respective applicable rules and
regulations adopted by the Commission thereunder and that they have
performed a review of any unaudited interim financial information
of the Company included or incorporated by reference in the
Registration Statement and the Prospectus and provide customary
“comfort” as to such review in form and substance
satisfactory to the Manager.
(e) No
Material Adverse Event. Since the respective dates as of
which information is disclosed in the Registration Statement, the
Prospectus and the Incorporated Documents, except as otherwise
stated therein, there shall not have been (i) any change or
decrease in previously reported results specified in the letter or
letters referred to in paragraph (d) of this Section 6 or
(ii) any change, or any development involving a prospective
change, in or affecting the condition (financial or otherwise),
earnings, business or properties of the Company and its
subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set
forth in or contemplated in the Registration Statement, the
Prospectus and the Incorporated Documents (exclusive of any
amendment or supplement thereto) the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the sole
judgment of the Manager, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery
of the Shares as contemplated by the Registration Statement
(exclusive of any amendment thereof), the Incorporated Documents
and the Prospectus (exclusive of any amendment or supplement
thereto).
29
(f) Payment
of All Fees. The Company shall have paid the required
Commission filing fees relating to the Shares within the time
period required by Rule 456(b)(1)(i) of the Act without regard
to the proviso therein and otherwise in accordance with
Rules 456(b) and 457(r) of the Act and, if applicable, shall
have updated the “Calculation of Registration Fee”
table in accordance with Rule 456(b)(1)(ii) either in a
post-effective amendment to the Registration Statement or on the
cover page of a prospectus filed pursuant to
Rule 424(b).
(g) No
FINRA Objections. FINRA shall not have raised any objection
with respect to the fairness and reasonableness of the terms and
arrangements under this Agreement.
(h) Shares
Listed on Trading Market. The Shares shall have been listed
and admitted and authorized for trading on the Trading Market, and
satisfactory evidence of such actions shall have been provided to
the Manager.
(i) Other
Assurances. Prior to each Settlement Date and Time of
Delivery, as applicable, the Company shall have furnished to the
Manager such further information, certificates and documents as the
Manager may reasonably request.
If any
of the conditions specified in this Section 6 shall not have been
fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this
Agreement shall not be reasonably satisfactory in form and
substance to the Manager and counsel for the Manager, this
Agreement and all obligations of the Manager hereunder may be
canceled at, or at any time prior to, any Settlement Date or Time
of Delivery, as applicable, by the Manager. Notice of such
cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.
The
documents required to be delivered by this Section 6 shall be
delivered to the office of Haynes and Boone, LLP, counsel for the
Manager, at 30 Rockefeller Plaza, 26th Floor, New York, New York
10112, email: rick.werner@haynesboone.com, on each such date as
provided in this Agreement.
7. Indemnification
and Contribution.
(a) Indemnification
by Company. The Company agrees to indemnify and hold
harmless the Manager, the directors, officers, employees and agents
of the Manager and each person who controls the Manager within the
meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the Act, the Exchange
Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement for the
registration of the Shares as originally filed or in any amendment
thereof, or in the Base Prospectus, any Prospectus Supplement, the
Prospectus, any Issuer Free Writing Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading or result from or relate to any breach of
any of the representations, warranties, covenants or agreements
made by the Company in this Agreement, and agrees to reimburse each
such indemnified party for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the Company will
not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by the Manager
specifically for inclusion therein. This indemnity agreement will
be in addition to any liability that the Company may otherwise
have.
30
(b) Indemnification
by Manager. The Manager agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers
who signs the Registration Statement, and each person who controls
the Company within the meaning of either the Act or the Exchange
Act, to the same extent as the foregoing indemnity from the Company
to the Manager, but only with reference to written information
relating to the Manager furnished to the Company by the Manager
specifically for inclusion in the documents referred to in the
foregoing indemnity; provided, however, that in no case shall
the Manager be responsible for any amount in excess of the Broker
Fee applicable to the Shares and paid hereunder. This indemnity
agreement will be in addition to any liability which the Manager
may otherwise have.
(c) Indemnification
Procedures. Promptly after receipt by an indemnified party
under this Section 7 of notice of the commencement of any
action, such indemnified party will, if a claim in respect thereof
is to be made against the indemnifying party under this
Section 7, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying
party (i) will not relieve it from liability under
paragraph (a) or (b) above unless and to the extent it
did not otherwise learn of such action and such failure results in
the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party’s
choice at the indemnifying party’s expense to represent the
indemnified party in any action for which indemnification is sought
(in which case the indemnifying party shall not thereafter be
responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth
below); provided,
however, that such
counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party’s election to appoint
counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear
the reasonable fees, costs and expenses of such separate counsel if
(i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a
conflict of interest, (ii) the actual or potential defendants
in, or targets of, any such action include both the indemnified
party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying
party, (iii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after
notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of
the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or
not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from
all liability arising out of such claim, action, suit or
proceeding.
(d) Contribution.
In the event that the indemnity provided in paragraph (a),
(b) or (c) of this Section 7 is unavailable to or
insufficient to hold harmless an indemnified party for any reason,
the Company and the Manager agree to contribute to the aggregate
losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or
defending the same) (collectively “Losses”) to which the
Company and the Manager may be subject in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and by the Manager on the other from the
offering of the Shares; provided, however, that in no case shall
the Manager be responsible for any amount in excess of the Broker
Fee applicable to the Shares and paid hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for
any reason, the Company and the Manager severally shall contribute
in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the
one hand and of the Manager on the other in connection with the
statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by
the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses) received by it, and
benefits received by the Manager shall be deemed to be equal to the
Broker Fee applicable to the Shares and paid hereunder as
determined by this Agreement. Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information provided
by the Company on the one hand or the Manager on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue
statement or omission. The Company and the Manager agree that it
would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no
person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person
who controls the Manager within the meaning of either the Act or
the Exchange Act and each director, officer, employee and agent of
the Manager shall have the same rights to contribution as the
Manager, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution
as the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
31
8. Termination.
(a) The
Company shall have the right, by giving written notice as
hereinafter specified, to terminate the provisions of this
Agreement relating to the solicitation of offers to purchase the
Shares in its sole discretion at any time upon ten (10) Business
Days’ prior written notice. Any such termination shall be
without liability of any party to any other party except that
(i) with respect to any pending sale, through the Manager for
the Company, the obligations of the Company, including in respect
of compensation of the Manager, shall remain in full force and
effect notwithstanding the termination and (ii) the provisions
of Sections 5, 6, 7, 8, 9, 10, 12, the second sentence of 13
and 14 of this Agreement shall remain in full force and effect
notwithstanding such termination.
(b) The
Manager shall have the right, by giving written notice as
hereinafter specified, to terminate the provisions of this
Agreement relating to the solicitation of offers to purchase the
Shares in its sole discretion at any time. Any such termination
shall be without liability of any party to any other party except
that the provisions of Sections 5, 6, 7, 8, 9, 10, 12, the
second sentence of 13 and 14 of this Agreement shall remain in full
force and effect notwithstanding such termination.
(c) This
Agreement shall remain in full force and effect until such date
that this Agreement is terminated pursuant to Sections 8(a) or
(b) above or otherwise by mutual agreement of the parties,
provided that any such termination by mutual agreement shall in all
cases be deemed to provide that Sections 5, 6, 7, 8, 9, 10,
12, the second sentence of 13 and 14 shall remain in full force and
effect.
(d) Any
termination of this Agreement shall be effective on the date
specified in such notice of termination, provided that such
termination shall not be effective until the close of business on
the date of receipt of such notice by the Manager or the Company,
as the case may be. If such termination shall occur prior to the
Settlement Date or Time of Delivery for any sale of the Shares,
such sale of the Shares shall settle in accordance with the
provisions of Section 2(b) of this Agreement.
(e) In
the case of any purchase of Shares by the Manager pursuant to a
Terms Agreement, the obligations of the Manager pursuant to such
Terms Agreement shall be subject to termination, in the absolute
discretion of the Manager, by prompt oral notice given to the
Company prior to the Time of Delivery relating to such Shares, if
any, and confirmed promptly by facsimile or electronic mail, if
since the time of execution of the Terms Agreement and prior to
such delivery and payment, (i) trading in the Common Stock
shall have been suspended by the Commission or the Trading Market
or trading in securities generally on the Trading Market shall have
been suspended or limited or minimum prices shall have been
established on such exchange, (ii) a banking moratorium shall
have been declared either by Federal or New York State authorities
or (iii) there shall have occurred any outbreak or escalation
of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which
on financial markets is such as to make it, in the sole judgment of
the Manager, impractical or inadvisable to proceed with the
offering or delivery of the Shares as contemplated by the
Prospectus (exclusive of any amendment or supplement
thereto).
32
9. Representations
and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of
the Company or its officers and of the Manager set forth in or made
pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by the Manager or the Company
or any of the officers, directors, employees, agents or controlling
persons referred to in Section 7, and will survive delivery of
and payment for the Shares.
10. Notices.
All communications hereunder will be in writing and effective only
on receipt, and will be mailed, delivered, e-mailed or facsimiled
to the addresses of the Company and the Manager, respectively, set
forth on the signature page hereto.
11. Successors.
This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers,
directors, employees, agents and controlling persons referred to in
Section 7, and no other person will have any right or
obligation hereunder.
12. No
Fiduciary Duty. The Company hereby acknowledges that
(a) the purchase and sale of the Shares pursuant to this
Agreement is an arm’s-length commercial transaction between
the Company, on the one hand, and the Manager and any affiliate
through which it may be acting, on the other, (b) the Manager
is acting solely as sales agent and/or principal in connection with
the purchase and sale of the Company’s securities and not as
a fiduciary of the Company and (c) the Company’s
engagement of the Manager in connection with the offering and the
process leading up to the offering is as independent contractors
and not in any other capacity. Furthermore, the Company agrees that
it is solely responsible for making its own judgments in connection
with the offering (irrespective of whether the Manager has advised
or is currently advising the Company on related or other matters).
The Company agrees that it will not claim that the Manager has
rendered advisory services of any nature or respect, or owe an
agency, fiduciary or similar duty to the Company, in connection
with such transaction or the process leading thereto.
13. Integration.
This Agreement and any Terms Agreement supersede all prior
agreements and understandings (whether written or oral) between the
Company and the Manager with respect to the subject matter hereof.
Notwithstanding anything herein to the contrary, the letter
agreement, dated October 13, 2020, by and between the Company and
the Manager shall continue to be effective and the terms therein
shall continue to survive and be enforceable by the Manager in
accordance with its terms, provided that, in the event of a
conflict between the terms of the letter agreement and this
Agreement, the terms of this Agreement shall prevail.
33
14. Amendments;
Waivers. No provision of this Agreement may be waived,
modified, supplemented or amended except in a written instrument
signed, in the case of an amendment, by the Company and the
Manager. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of
any such right.
15. Applicable
Law. This Agreement and any Terms Agreement will be governed
by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed within the
State of New York. Each of the Company and the Manager: (i)
agrees that any legal suit, action or proceeding arising out of or
relating to this Agreement shall be instituted exclusively in New
York Supreme Court, County of New York, or in the United States
District Court for the Southern District of New York, (ii) waives
any objection which it may have or hereafter to the venue of any
such suit, action or proceeding, and (iii) irrevocably consents to
the jurisdiction of the New York Supreme Court, County of New York,
and the United States District Court for the Southern District of
New York in any such suit, action or proceeding. Each of the
Company and the Manager further agrees to accept and acknowledge
service of any and all process which may be served in any such
suit, action or proceeding in the New York Supreme Court, County of
New York, or in the United States District Court for the Southern
District of New York and agrees that service of process upon the
Company mailed by certified mail to the Company’s address
shall be deemed in every respect effective service of process upon
the Company, in any such suit, action or proceeding, and service of
process upon the Manager mailed by certified mail to the
Manager’s address shall be deemed in every respect effective
service process upon the Manager, in any such suit, action or
proceeding. If either party shall commence an action or proceeding
to enforce any provision of this Agreement, then the prevailing
party in such action or proceeding shall be reimbursed by the other
party for its reasonable attorney’s fees and other costs and
expenses incurred with the investigation, preparation and
prosecution of such action or proceeding.
16. WAIVER
OF JURY TRIAL. THE COMPANY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, ANY TERMS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
17. Counterparts.
This Agreement and any Terms Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of
which together shall constitute one and the same agreement, which
may be delivered by facsimile or in .pdf file via
e-mail.
***************************
34
18. Headings.
The section headings used in this Agreement and any Terms Agreement
are for convenience only and shall not affect the construction
hereof.
If the
foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate
hereof, whereupon this letter and your acceptance shall represent a
binding agreement among the Company and the Manager.
Very
truly yours,
AZURRX
BIOPHARMA, INC.
By:
/s/
James Sapirstein
Name:
James Sapirstein
Title:
President and Chief Executive Officer
Address for
Notice:
1615
South Congress Avenue, Suite 103
Delray
Beach, Florida 33445
Attention: Chief
Executive Officer
E-mail:
jsapirstein@azurrx.com
The
foregoing Agreement is hereby confirmed and accepted as of the date
first written above.
H.C.
WAINWRIGHT & CO., LLC
|
By:
/s/ Edward D.
Silvera
Name:
Edward
D. Silvera
Title:
Chief Operating Officer
|
Address for
Notice:
430
Park Avenue
New
York, New York 10022
Attention:
Chief Executive Officer
E-mail:
notices@hcwco.com
35
Form of Terms Agreement
ANNEX I
AZURRX BIOPHARMA, INC.
TERMS AGREEMENT
Dear
Sirs:
AzurRx BioPharma,
Inc. (the “Company”) proposes,
subject to the terms and conditions stated herein and in the At The
Market Offering Agreement, dated May 26, 2021 (the
“At The Market
Offering Agreement”), between the Company and H.C.
Wainwright & Co., LLC (“Manager”), to issue and
sell to Manager the securities specified in the Schedule I hereto (the
“Purchased
Shares”).
Each of the
provisions of the At The Market Offering Agreement not specifically
related to the solicitation by the Manager, as agent of the
Company, of offers to purchase securities is incorporated herein by
reference in its entirety, and shall be deemed to be part of this
Terms Agreement to the same extent as if such provisions had been
set forth in full herein. Each of the representations and
warranties set forth therein shall be deemed to have been made at
and as of the date of this Terms Agreement and the Time of
Delivery, except that each representation and warranty in
Section 3 of the At The Market Offering Agreement which makes
reference to the Prospectus (as therein defined) shall be deemed to
be a representation and warranty as of the date of the At The
Market Offering Agreement in relation to the Prospectus, and also a
representation and warranty as of the date of this Terms Agreement
and the Time of Delivery in relation to the Prospectus as amended
and supplemented to relate to the Purchased Shares.
An amendment to the
Registration Statement (as defined in the At The Market Offering
Agreement), or a supplement to the Prospectus, as the case may be,
relating to the Purchased Shares, in the form heretofore delivered
to the Manager is now proposed to be filed with the Securities and
Exchange Commission.
Subject to the
terms and conditions set forth herein and in the At The Market
Offering Agreement which are incorporated herein by reference, the
Company agrees to issue and sell to the Manager and the latter
agrees to purchase from the Company the number of shares of the
Purchased Shares at the time and place and at the purchase price
set forth in the Schedule I
hereto.
36
If the foregoing is in accordance with
your understanding, please sign and return to us a counterpart
hereof, whereupon this Terms Agreement, including those provisions
of the At The Market Offering Agreement incorporated herein by
reference, shall constitute a binding agreement between the Manager
and the Company.
|
|
|
|
|
|
|
AZURRX
BIOPHARMA, INC.
|
|
|
||
|
By:
Name:
Title:
|
||||
ACCEPTED as of the
date first written above.
|
|
|
|
|
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H.C.
WAINWRIGHT & CO., LLC
|
|
|
||
By:__________________________________________
Name:
Title:
37
Exhibit 5.1
May 26, 2021
AzurRx BioPharma, Inc.
1615 South Congress Avenue, Suite 103
Delray Beach, Florida 33445
Re: Shelf
Registration on Form S-3
Ladies and Gentlemen:
This
opinion is being furnished to you in connection with the
Registration Statement on Form S-3 (the “Registration
Statement”), including the base prospectus that is part of
the Registration Statement (the “Prospectus”), the
sales agreement prospectus that is part of the Registration
Statement (the “ATM Prospectus”) and a prospectus
covering the resale by the selling stockholders named therein that
is part of the Registration Statement (the “Resale
Prospectus”), filed by AzurRx BioPharma, Inc., a Delaware
corporation (the “Company”), with the Securities and
Exchange Commission (the “Commission”) on May 26, 2021
under the Securities Act of 1933, as amended (the “Securities
Act”).
The
Prospectus provides that it will be supplemented in the future by
one or more prospectus supplements (each, a “Prospectus
Supplement”). The Prospectus, as supplemented by the various
Prospectus Supplements, will provide for the issuance and sale by
the Company from time to time of up to $150,000,000 aggregate
offering price of (i) shares of the Company's common stock, par
value $0.0001 per share (the “Common Stock”), (ii)
shares of the Company's preferred stock, par value $0.0001 per
share (the “Preferred Stock”), in one or more series or
classes, (iii) warrants to purchase shares of Common Stock or
Preferred Stock (the “Warrants”), (iv) subscription
rights to purchase Common Stock (the “Subscription
Rights”) or (v) units composed of any of the foregoing (the
“Units”). The Common Stock, Preferred Stock, Warrants,
Subscription Rights and Units are collectively referred to herein
as the “Securities.” The Warrants may be issued
pursuant to a warrant agreement (the “Warrant
Agreement”) between the Company and a bank or trust company
as warrant agent. Any Preferred Stock may be exchangeable for
and/or convertible into shares of Common Stock or another series of
Preferred Stock. The Units may be issued pursuant to a Unit
Agreement (the “Unit Agreement”) between the Company
and a bank or trust company as unit agent. The Securities are being
registered for offering and sale from time to time pursuant to Rule
415 under the Securities Act.
The
ATM Prospectus relates to the sale by the Company of shares of
common stock having an aggregate offering price of up to
$50,000,000 (the “ATM Shares”) under a Sales Agreement
dated as of May 20, 2021 (the “Sales Agreement”)
between the Company and H.C. Wainwright & Co.,
LLC.
The
Resale Prospectus relates to the resale of up to 3,464,664 shares
of Common Stock by the selling stockholders named therein. Such
shares consist of: (i) up to 75,663 shares of Common Stock (the
“Selling Agent Warrant Shares”) issuable upon exercise
of warrants to purchase Common Stock (the “Selling Agent
Warrants”) named in the Resale Prospectus, which are
currently issued and outstanding and (ii) 3,389,001 shares of
Common Stock (the “Resale Shares”).
In
rendering our opinions set forth below, we have reviewed the
Registration Statement and the exhibits thereto. We have also
reviewed such corporate documents and records of the Company, such
certificates of public officials and officers of the Company and
such other matters as we have deemed necessary or appropriate for
purposes of this opinion. In our examination, we have assumed: (i)
the authenticity of original documents and the genuineness of all
signatures; (ii) the conformity to the originals of all documents
submitted to us as copies; (iii) the truth, accuracy and
completeness of the information, representations and warranties
contained in the instruments, documents, certificates and records
we have reviewed; and(iv) the legal capacity for all purposes
relevant hereto of all natural persons and, with respect to all
parties to agreements or instruments relevant hereto other than the
Company, that such parties had the requisite power and authority
(corporate or otherwise) to execute, deliver and perform such
agreements or instruments, that such agreements or instruments have
been duly authorized by all requisite action (corporate or
otherwise), executed and delivered by such parties and that such
agreements or instruments are the valid, binding and enforceable
obligations of such parties. As to any facts material to the
opinions expressed herein that were not independently established
or verified, we have relied upon oral or written statements and
representations of officers and other representatives of the
Company.
- 1 -
Based
on the foregoing, and subject to the assumptions, limitations and
qualifications set forth herein, we are of the opinion
that:
1.
With respect to shares of Common Stock (other than the ATM Shares,
Selling Agent Warrant Shares and the Resale Shares), when (a) the
issuance and the terms of the sale of the shares of Common Stock
have been duly authorized by the Board of Directors of the Company
in conformity with the Company's certificate of incorporation and
bylaws; (b) such shares have been issued and delivered against
payment of the purchase price therefor in an amount in excess of
the par value thereof, in accordance with the applicable definitive
purchase, underwriting or similar agreement, and as contemplated by
the Registration Statement, the Prospectus and the related
Prospectus Supplement; and (c) to the extent such shares of Common
Stock are to be issued upon the conversion, exchange or exercise of
any Preferred Stock or Warrants, when such shares have been duly
issued and delivered as contemplated by the terms of the applicable
Preferred Stock or the Warrant Agreement relating to such Warrants,
respectively, the shares of Common Stock will be validly issued,
fully paid and nonassessable.
2.
With respect to the ATM Shares, when the ATM Shares have been
issued and sold in accordance with the Sales Agreement, and as
described in the Registration Statement and ATM Prospectus, the ATM
Shares will be validly issued, fully paid and
nonassessable.
3.
With respect to the Selling Agent Warrant Shares, when the Selling
Agent Warrant Shares have been duly issued and delivered in
accordance with the terms of the respective Selling Agent Warrants,
the Selling Agent Warrant Shares will be validly issued, fully paid
and non-assessable.
4.
With respect to the Resale Shares, the Resale Shares are validly
issued, fully paid and non-assessable.
5.
With respect to any particular series of shares of Preferred Stock,
when (a) the issuance and the terms of the sale of the shares of
Preferred Stock have been duly authorized by the Board of Directors
of the Company in conformity with the Company's certificate of
incorporation and bylaws; (b) an appropriate certificate of
designation relating toa series of the Preferred Stock to be sold
under the Registration Statement has been duly authorized and
adopted and filed with the Secretary of State of Delaware; (c) the
terms of issuance and sale of shares of such series of Preferred
Stock have been duly established in conformity with the Company's
certificate of incorporation and bylaws so as not to violate any
applicable law or result in a default under or breach of any
agreement or instrument binding upon the Company and comply with
any requirement or restriction imposed by any court or governmental
body having jurisdiction over the Company or any of its property;
(d) such shares have been issued and delivered against payment of
the purchase price therefor in an amount in excess of the par value
thereof, in accordance with the applicable definitive purchase,
underwriting or similar agreement, and as contemplated by the
Registration Statement, the Prospectus and the related Prospectus
Supplement; and (e) to the extent such shares of Preferred Stock
are to be issued upon the conversion, exchange or exercise of any
Preferred Stock or Warrants, when such shares have been duly issued
and delivered as contemplated by the terms of the applicable
Preferred Stock, or the Warrant Agreement relating to such
Warrants, respectively, the shares of Preferred Stock will be
validly issued, fully paid and nonassessable.
- 2 -
6.
With respect to Warrants, when (a) the issuance and the terms of
the sale of the Warrants have been duly authorized by the Board of
Directors of the Company; (b) the terms of the Warrants and of
their issuance and sale have been duly established so as not to
violate any applicable law or result in a default under or breach
of any agreement or instrument binding upon the Company and comply
with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company or any of
its property; (c) the Warrants and the applicable Warrant Agreement
relating to the Warrants, if any, have been duly executed and
countersigned and the Warrants have been issued and sold in
accordance with the applicable definitive purchase, underwriting or
similar agreement, as contemplated by the Registration Statement,
the Prospectus and the related Prospectus Supplement; and (d) the
Company has received the applicable consideration for the Warrants
as contemplated by the Registration Statement, the Prospectus and
the related Prospectus Supplement(s), the Warrants will constitute
valid and binding obligations of the Company.
7. With respect to the Subscription Rights,
when both: (a) the issuance and the terms of the sale of the
Subscription Rights have been duly authorized by the Board of
Directors of the Company; (b) the terms of the Subscription Rights
and of their issuance and sale have been duly established so as not
to violate any applicable law or result in a default under or
breach of any agreement or instrument binding upon the Company and
comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company or any of
its property; and (c) the agreement(s) relating to the Subscription
Rights have been duly authorized and validly executed and delivered
by the Company, then the Subscription Rights will be valid and
binding obligations of the Company, enforceable against the Company
in accordance with their terms.
8.
With respect to Units, when (a) the issuance and the terms of the
sale of the Units have been duly authorized by the Board of
Directors of the Company; (b) the terms of the Units and of their
issuance and sale have been duly established so as not to violate
any applicable law or result in a default under or breach of any
agreement or instrument binding upon the Company and comply with
any requirement or restriction imposed by any court or governmental
body having jurisdiction over the Company or any of its property;
(c) the Unit Agreement and the Units, if any, have been duly
executed and countersigned and the Units have been issued and sold
in accordance with the applicable Unit Agreement, as contemplated
by the Registration Statement, the Prospectus and the related
Prospectus Supplement; and (d) the Company has received the
applicable consideration for the Units as contemplated by the
Registration Statement, the Prospectus and the related Prospectus
Supplement(s), the Units will constitute valid and binding
obligations of the Company.
In
rendering the opinions set forth above, we have assumed that (i)
the Registration Statement (and any applicable post-effective
amendment thereto) will have become effective under the Securities
Act, a Prospectus Supplement will have been prepared and filed with
the Commission describing the Securities offered thereby and such
Securities will have been issued and sold in accordancewith the
terms of such Prospectus Supplement and in compliance with all
applicable laws; and (ii) a definitive purchase, underwriting or
similar agreement with respect to such Securities (if applicable)
will have been duly authorized, executed and delivered by the
Company and the other parties thereto; (iii) the Securities will be
duly authorized by all necessary corporate action by the Company
and any agreement pursuant to which such Securities may be issued
will be duly authorized, executed and deliveredby the Company and
the other parties thereto; (iv) the Company will remain duly
organized, validly existing and in good standing under applicable
state law; and (v) the Company has reserved a sufficient number of
shares of its duly authorized, but unissued, Common Stock and
Preferred Stock as is necessary to provide for the issuance of the
shares of Common Stock and Preferred Stock pursuant to the
Registration Statement, the Prospectus and the related Prospectus
Supplement.
- 3 -
The
opinions set forth above are subject to the following exceptions,
limitations and qualifications: (i) the effect of bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to or
affecting the rights and remedies of creditors; (ii) the effect of
general principles of equity, including without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing and the possible unavailability of specific performance or
injunctive relief, regardless of whether enforcement is considered
in a proceeding in equity or at law, and the discretion of the
court before which any proceeding therefor may be brought; and
(iii) the unenforceability under certain circumstances under law or
court decisions of provisions providing for the indemnification of,
or contribution to, a party with respect to liability where such
indemnification or contribution is contrary to public policy. We
express no opinion concerning the enforceability of any waiver of
rights or defenses with respect to stay, extension or usury laws.
Our opinion expressed herein is also subject to the qualification
that no term or provision shall be included in any certificate of
designation relating to any series of the Preferred Stock, Warrant
Agreement, Unit Agreement or any other agreement or instrument
pursuant to which any of the Securities are to be issued that would
affect the validity of such opinion.
Our
opinion is limited to the federal laws of the United States, the
General Corporation Law of the State of Delaware (including
reported judicial decisions interpreting the General Corporation
Law of the State of Delaware) and the State of New York.
We express no opinion as to the effect of the law of any other
jurisdiction. Our opinion is rendered as of the date hereof, and we
assume no obligation to advise you of changes in law or fact (or
the effect thereof on the opinions expressed herein) that hereafter
may come to our attention.
We
hereby consent to the inclusion of this opinion as Exhibit 5.1 to
the Registration Statement and to the references to our firm
therein and in the Prospectus, the ATM Prospectus and the Resale
Prospectus and in any Prospectus Supplement under the caption
“Legal Matters.” In giving our consent, we do not admit
that we are in the category of persons whose consent is required
under Section 7 of the Securities Act or the rules and regulations
thereunder.
Very truly yours,
/s/ Lowenstein Sandler LLP
LOWENSTEIN SANDLER LLP
- 4 -
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
We
hereby consent to the incorporation by reference in this
Registration Statement on Form S-3 of AzurRx BioPharma, Inc. (to be
filed on May 26, 2021) of our report dated March 31, 2021, on the
consolidated financial statements of AzurRx BioPharma, Inc. as of
December 31, 2020 and 2019 and for the years then ended. Our report
on the consolidated financial statements of AzurRx BioPharma, Inc.
includes an explanatory paragraph about the existence of
substantial doubt concerning its ability to continue as a going
concern. We also consent to the reference to our Firm under the
caption “Experts” in this Form S-3.
/s/ Mazars USA LLP
New
York, New York
May 26,
2021