YIELD10 BIOSCIENCE,INC. (NASDAQ:YTEN) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 Entry into a Material Definitive Agreement
On July3, 2017, Yield10 Bioscience,Inc., a Delaware corporation (the “Company”), entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain investors named therein (the “Investors”), including Jack W. Schuler, an existing stockholder, and entities affiliated with him, to which the Company agreed to issue and sell, in a registered public offering by the Company directly to the Investors (the “Public Offering”), an aggregate of 570,784 shares (the “Shares”) of common stock, par value $0.01 per share, of the Company (“Common Stock”), at an offering price of $4.00 per share for gross proceeds of approximately $2.3 million before deducting the placement agent fee and related offering expenses. The Shares were offered by the Company to a registration statement on FormS-3 (File No.333-217051), which was filed with the Securities and Exchange Commission (the “Commission”) on March30, 2017 and was declared effective by the Commission on April12, 2017 (the “Registration Statement”).
In a concurrent private placement (the “Private Placement” and together with the Public Offering, the “Offerings”), the Company agreed to issue to the Investors who participated in the Public Offering warrants (the “Warrants” and collectively with the Shares, the “Securities”) exercisable for one share of Common Stock for each Share purchased in the Offering for an aggregate of 570,784 shares of Common Stock at an exercise price of $5.04 per share. Each Warrant will be exercisable beginning on the six-month anniversary of the date of its issuance and will expire six years from the date it becomes exercisable. If at any time after the six-month anniversary of the date of issuance there is no effective registration statement registering, or no current prospectus available for, the resale of the shares of Common Stock issuable upon the exercise of the Warrants, then the holders have the right to exercise the Warrants on a cashless basis at such time. Subject to limited exceptions, a holder of a Warrant, other than Mr.Schuler and entities affiliated with him, will not have the right to exercise any portion of its warrants if the holder, together with its affiliates, would beneficially own in excess of 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to such exercise (the “Beneficial Ownership Limitation”); provided, however, that upon 61 days’ prior notice to the Company, the holder may increase or decrease the Beneficial Ownership Limitation, provided further that in no event shall the Beneficial Ownership Limitation exceed 9.99%. Under certain circumstances, the Company has the right to call for cancellation all or any portion of each Warrant for which a notice of exercise has not yet been delivered for consideration equal to $0.001 per share of Common Stock issuable upon the exercise of the Warrant. The call right must be exercised ratably among the holders based on each holder’s initial purchase of Warrants, and it may be invoked by the Company at any time after the date on which the Warrants become exercisable if (i)the volume weighted average price for each of twenty consecutive trading days (such period commencing after the date on which the Warrants become exercisable and referred to as the measurement period) exceeds $10.00 (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and the like after the issuance date), (ii)the average daily volume for such measurement period exceeds $125,000 per trading day, (iii)the holder is not in possession of any information that constitutes, or might constitute, material non-public information which was provided by the Company and (iv)either (a)there is an effective registration statement to which the holder is permitted to utilize the prospectus thereunder to resell all of the shares of Common Stock issuable upon the exercise of the Warrant or (b)all of the shares of Common Stock issuable upon the exercise of the Warrant may be sold to Rule144 under the Securities Act of 1933, as amended, without the requirement for the Company to be in compliance with the current public information required under Rule144 and without volume or manner-of-sale restrictions. The Company must deliver an irrevocable written notice to a holder to invoke the call right and the holder will have ten trading days to exercise its Warrant prior to cancellation.
The Warrants and the shares of our Common Stock issuable upon the exercise of the Warrants are not being registered under the Securities Act of 1933, as amended (the “Securities Act”), were not offered to the Registration Statement and were offered to the exemption provided in Section4(a)(2)under the Securities Act, and Rule506(b)promulgated thereunder.
On July3, 2017, the Company entered into a Placement Agency Agreement (the “Placement Agency Agreement”) with Ladenburg Thalmann& Co. Inc., (“Ladenburg” or the “Placement Agent”) to which the Company engaged Ladenburg as the sole placement agent in connection with the Offerings. The Placement Agent agreed to use its reasonable best efforts to arrange for the sale of the Securities. The Company agreed to pay the Placement Agent a placement agent fee in cash equal to 8% of the gross proceeds from the sale of the Securities, with the fee reduced to 3% for gross cash consideration paid by certain investors listed on Annex A to the Placement Agency
