SYNTHETIC BIOLOGICS, INC. (NYSEMKT:SYN) Files An 8-K Entry into a Material Definitive Agreement

ME Staff

8 years ago

SYNTHETIC BIOLOGICS, INC. (NYSEMKT:SYN) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01

Entry into a Material Definitive Agreement.

On November 15, 2016, Synthetic Biologics, Inc. (the Company)
entered into an underwriting agreement (the Underwriting
Agreement) with Cantor Fitzgerald Co. (the Underwriter), relating
to the offering, issuance and sale of 25,000,000 shares of the
Companys common stock (the Common Stock) in combination with
accompanying warrants (the Warrants) to purchase an aggregate of
50,000,000 shares of the Common Stock (the Offering). The Common
Stock and Warrants are being sold in combination, with two
Warrants for each share of Common Stock sold, a Series A warrant
and a Series B warrant, each representing the right to purchase
one share of Common Stock. The purchase price for each share of
Common Stock and accompanying Warrants is $1.00.

The shares of Common Stock are immediately separable from the
Warrants and will be issued separately. The initial per share
exercise price of the Series A warrants is $1.43 and the per
share exercise price of the Series B warrants is $1.72, each
subject to adjustment as specified in the Warrants. The Series A
and Series B warrants may be exercised at any time on or after
the date of issuance. The Series A warrants are exercisable until
the four year anniversary of the issuance date. The Series B
warrants are exercisable untilDecember 31, 2017. There is no
established trading market for the Warrants and the Company does
not expect a market to develop. In addition, the Company does not
intend to apply for the listing of the Warrants on any national
securities exchange or other trading market.

The Company will enter into a warrant agreement (the Warrant
Agreement), with Corporate Stock Transfer, Inc. (the Warrant
Agent), to which the Warrant Agent will act as the Companys agent
in connection with the issuance, registration, transfer,
exchange, exercise and replacement of the Warrants and the
delivery of the shares of Common Stock upon exercise of the
Warrants. The Warrants will be issued in book-entry form.

to the terms of the Warrant, a holder of a Warrant will not have
the right to exercise any portion of the Warrant if the holder
(together with its affiliates) would beneficially own in excess
of 9.99% of the number of shares of Common Stock outstanding
immediately after giving effect to the exercise, as such
percentage ownership is determined in accordance with the terms
of the Warrants provided that at the election of a holder and
notice to us such percentage ownership limitation shall be 4.99%
of the number of shares of Common Stock outstanding immediately
after giving effect to the exercise. However, any holder may
increase or decrease such percentage to any other percentage not
in excess of 9.99% upon at least 61 days prior notice from the
holder to the Company.

If, at the time a holder exercises its Warrant, there is no
effective registration statement registering, or the prospectus
contained therein is not available for an issuance of the shares
underlying the Warrant to the holder, then in lieu of making the
cash payment otherwise contemplated to be made to us upon such
exercise in payment of the aggregate exercise price, the holder
may elect instead to receive upon such exercise (either in whole
or in part) the net number of shares of our Common Stock
determined according to a formula set forth in the Warrant. In
the event of a cashless exercise, if we fail to timely deliver
the shares underlying the Warrants, we will be subject to certain
buy-in provisions.

In the event of any extraordinary transaction, as described in
the Warrants and generally including any merger with or into
another entity, sale of all or substantially all of our assets,
tender offer or exchange offer, or reclassification of our common
stock, the holder will have the right to have the Warrants and
all obligations and rights thereunder assumed by the successor or
acquiring corporation. In the event of an extraordinary
transaction, we or any successor entity will pay at the holders
option, exercisable at any time concurrently with or within 30
days after the consummation of the extraordinary transaction, an
amount of cash equal to the value of the Warrant as determined in
accordance with the Black Scholes option pricing model and the
terms of the Warrants.

For the period that our lock-up agreement with Cantor Fitzgerald
Co., as described in the Underwriting Agreement, is in effect, we
are prohibited form effecting or entering into any issuance of
Common Stock or Common Stock Equivalents (as defined in the
Warrant Agreement) involving a Variable Rate Transaction (as
defined in the Warrant Agreement).

Subject to applicable laws and the restriction on transfer set
forth in the Warrant, the Warrant may be transferred at the
option of the holder upon surrender of the Warrant to the Company
together with the appropriate instruments of transfer.

The Offering is being made to the Companys effective registration
statement on Form S-3 (Registration Statement No.333-206266)
previously filed with and declared effective by the Securities
and Exchange Commission (the SEC) and a prospectus supplement and
accompanying prospectus filed with the SEC.

The Underwriting Agreement contains customary representations,
warranties and agreements by the Company, conditions to closing,
indemnification obligations of the Company and the Underwriter,
including for liabilities under the Securities Act of 1933, as
amended, other obligations of the parties and termination
provisions. 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 foregoing descriptions of the terms of the Underwriting
Agreement, the Warrant Agreement and the Warrants do not purport
to be complete and are subject to, and qualified in their
entirety by reference to, the form of Underwriting Agreement, the
forms of each of the Warrants and the Warrant Agreement, which
are filed as Exhibit 1.1, Exhibit 4.1, Exhibit 4.2 and Exhibit
4.3, respectively, to this Current Report on Form 8-K and are
incorporated herein by reference. A copy of the opinion of
Parsons Behle Latimer relating to the legality of the issuance
and sale of the Common Stock and the shares of Common Stock
issuable upon exercise of the Warrants is attached as Exhibit
5.1(a) to this Current Report on Form 8-K and a copy of the
opinion of Gracin Marlow, LLP regarding the legality of the
issuance and sale of the Warrants is attached as Exhibit 5.1(b)
to this Current Report on Form 8-K.

Use of Proceeds

The net proceeds to the Company from the sale of the Common Stock
and accompanying Warrants, excluding the proceeds, if any from
the exercise of the Warrants issued in the Offering are expected
to be approximately $23.3 million, after deducting underwriting
discounts and commissions and estimated expenses payable by the
Company. The Company intends to use the net proceeds from the
Offering primarily to provide necessary funding for the continued
clinical development of SYN-010, including initiation of the
Companys planned Phase 2b/3 clinical trial of SYN-010, and
progression of SYN-004 to Phase 2 data readout and initiation of
the planned Phase 3 clinical trial for SYN-004.In addition, a
portion of the net proceeds may be used for general corporate
purposes, which may include, among other things, payment of
general and administrative expenses and accounts payable,
increasing working capital, funding research and development and
clinical trials of the Companys other product candidates and
funding capital expenditures. The Company may also use a portion
of the net proceeds for licensing or acquiring intellectual
property to incorporate into its products and product candidates
or its research and development programs, and to in-license,
acquire or invest in complementary businesses or products and
intellectual property.

Item 8.01

Other Events.

On November 14, 2016, the Company issued a press release
announcing the proposed Offering, and on November 15, 2016, the
Company issued a press release announcing the pricing of the
Offering. Copies of the press releases are attached as Exhibits
99.1 and 99.2, respectively, to this Current Report on Form 8-K.

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description

1.1		Underwriting Agreement, dated November 15, 2016, by and between Synthetic Biologics, Inc. and Cantor Fitzgerald Co.

4.1		Form of Series A Common Stock Purchase Warrant

4.2		Form of Series B Common Stock Purchase Warrant

4.3		Form of Warrant Agreement by and between Synthetic Biologics, Inc. and Corporate Stock Transfer, Inc.

5.1(a)		Opinion of Parsons Behle Latimer

5.1(b)		Opinion of Gracin Marlow, LLP

23.1		Consent of Parsons Behle Latimer (included in Exhibit 5.1(a))

23.2		Consent of Gracin Marlow, LLP (included in Exhibit 5.1(b))

99.1		Press release, dated November 14, 2016

99.2		Press release, dated November 15, 2016

About SYNTHETIC BIOLOGICS, INC. (NYSEMKT:SYN)
Synthetic Biologics, Inc. is a clinical-stage company. The Company is engaged in developing therapeutics to protect the gut microbiome while targeting pathogen-specific diseases. The Company’s lead product candidates in Phase II development are SYN-010, which is intended to reduce the impact of methane-producing organisms in the gut microbiome to treat an underlying cause of irritable bowel syndrome with constipation (IBS-C), and SYN-004, which is designed to protect the gut microbiome (gastrointestinal (GI) microflora) from the effects of certain commonly used intravenous (IV) antibiotics for the prevention of C. difficile infection (CDI) and antibiotic-associated diarrhea (AAD). Its other product candidates include SYN-007, SYN-006, SYN-005, SYN-200 and SYN-020. The Company is also developing preclinical-stage monoclonal antibody therapies for the prevention and treatment of pertussis, and discovery-stage biotherapeutics for the treatment of phenylketonuria (PKU). SYNTHETIC BIOLOGICS, INC. (NYSEMKT:SYN) Recent Trading Information
SYNTHETIC BIOLOGICS, INC. (NYSEMKT:SYN) closed its last trading session up +0.009 at 0.899 with 591,450 shares trading hands.