Novan, Inc. (NASDAQ:NOVN) Files An 8-K Entry into a Material Definitive AgreementItem 1.01.
On January5, 2018, Novan, Inc. (the “Company”) entered into an Underwriting Agreement (the “Underwriting Agreement”) with Piper Jaffray& Co., as representative of the underwriters named therein (the “Underwriters”), related to the sale and issuance of 10,000,000 shares (the “Shares”) of its Common Stock, $0.0001 par value per share (“Common Stock”), and warrants to purchase up to 10,000,000 shares of Common Stock (the “Warrants”). The Warrants are exercisable immediately upon issuance at an initial exercise price of $4.66 per share and will expire four years from the date of issuance.
The combined public offering price in this offering for each Share and accompanying Warrant is $3.80. The net proceeds to the Company from this offering are expected to be approximately $35.2million, after deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company, and excluding any proceeds the Company may receive upon exercise of the Warrants. The offering closed on January9, 2018.
The exercise price and the number of shares of common stock purchasable upon the exercise of the warrants are subject to adjustment upon the occurrence of specific events, including sales of additional shares of common stock, stock dividends, stock splits, reclassifications and combinations of our common stock. If, at any time Warrants are outstanding, any fundamental transaction occurs, as described in the Warrants and generally including any consolidation or merger into another corporation, the consummation of a transaction whereby another entity acquires more than 50% of the Company’s outstanding voting stock, or the sale of all or substantially all of its assets, the successor entity must assume the obligations to the Warrant holders. Additionally, in the event of a fundamental transaction, other than one in which a successor entity that is a publicly traded corporation assumes the Warrants, each Warrant holder will have the right to require the Company, or its successor, to repurchase the Warrants for an amount of cash equal to the Black-Scholes value of the remaining unexercised portion of such Warrants.
The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, termination provisions and other obligations of the parties. Upon closing of the offering, the Company entered into a warrant agreement (the “Warrant Agreement”) with American Stock Transfer & Trust Company, LLC (the “Transfer Agent”), to which the Warrants were issued and the Transfer Agent will act as warrant agent for the Warrants. The representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement and may be subject to limitations agreed upon by the contracting parties.
The offering was made to the Company’s registration statement on Form S-3 (Registration Statement No.333-220761) filed with the Securities and Exchange Commission (the “SEC”) on October 2, 2017 and declared effective on October 10, 2017 and the prospectus supplement dated January 5, 2018 thereunder. The Underwriting Agreement, the Warrant Agreement and the form of Warrant are attached hereto as Exhibit 1.1, Exhibit 4.1 and Exhibit 4.2, respectively, and are incorporated herein by reference, and the description of the terms of the Underwriting Agreement, the Warrant Agreement and the Warrants are qualified in their entirety by reference to such exhibits. A copy of the opinion of Smith, Anderson, Blount, Dorsett, Mitchell& Jernigan, L.L.P. relating to the legality of the issuance and sale of the Shares, the Warrants and the shares of Common Stock issuable upon exercise of the Warrants is attached hereto as Exhibit 5.1.
A copy of the press release announcing the pricing of the offering is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements including, but not limited to, statements related to the anticipated amount of proceeds from a public offering. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the Company’s expectations, including, but not limited to, risks and uncertainties described in the Company’s annual report filed with the SEC on Form 10-K for the twelve months ended Dec. 31, 2016, and in any subsequent filings with the SEC. These forward-looking statements speak only as of the date of this Current Report on Form 8-K, and the Company disclaims any intent or obligation to update these forward-looking statements to reflect events or circumstances after the date of such statements, except as may be required by law.
| Item 1.01. | Financial Statements and Exhibits. |
EXHIBIT INDEX
|
Exhibit No. |
Description |
| 1.1 | Underwriting Agreement, dated January5, 2018, by and between Novan, Inc. and Piper Jaffray& Co., as representative of the underwriters named therein. |
| 4.1 | Form of Warrant Agreement. |
| 4.2 | Form of Common Stock Purchase Warrant (included in Exhibit 4.1). |
| 5.1 | Opinion of Smith, Anderson, Blount, Dorsett, Mitchell& Jernigan, L.L.P. |
| 23.1 | Consent of Smith, Anderson, Blount, Dorsett, Mitchell& Jernigan, L.L.P. (included in Exhibit 5.1). |
| 99.1 | Press Release of Novan, Inc., issued on January5, 2018. |
Novan, Inc. ExhibitEX-1.1 2 d520977dex11.htm EX-1.1 EX-1.1 Exhibit 1.1 EXECUTION VERSION 10,…To view the full exhibit click here
About Novan, Inc. (NASDAQ:NOVN)
Novan, Inc. is a late-stage pharmaceutical company. The Company is engaged in the development and commercialization of therapies using its nitric oxide platform. The Company develops product candidates using its Nitricil technology, which enables the Company to engineer tunable new chemical entities (NCEs). The Company’s formulation science enables it to further tune the release of nitric oxide when applied to the skin by using the combinations of inactive ingredients. It is developing SB204 for the treatment of acne vulgaris in Phase III. The Company is developing its product candidate, SB206, for the treatment of external genital and perianal warts in Phase II. It is developing SB208, an investigational topical anti-fungal for the treatment of fungal infections of the skin and nails. It is developing SB204 for the treatment of inflammatory skin diseases. Its pipeline also includes SB414, a topical cream product candidate.
