Item 1.01 Entry into a Material Definitive Agreement.
On October 8, 2024, Bio - Path Holdings, Inc. (the “Company”) entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Purchaser”) for the issuance and sale in a private placement (the “Private Placement”) of (i) pre-funded warrants to purchase up to 4,597,702 shares of Common Stock (the “Pre-Funded Warrants”), (ii) series A warrants to purchase up to 6,407,657 shares of Common Stock (the “Series A Warrants”), and (iii) series B warrants to purchase up to 6,407,657 shares of Common Stock (the “Series B Warrants” and together with the Series A Warrants, the “Common Warrants”). The purchase price of each Pre-Funded Warrant and accompanying Common Warrants was $0.869. The Company must seek approval from its stockholders (the “Stockholder Approval”) for the the issuance of the shares issuable upon exercise of the Common Warrants by January 8, 2025. In the event the stockholders of the Company do not approve the issuance, the Company is required to seek Stockholder Approval every 90 days thereafter until Stockholder Approval is obtained or until the Common Warrants are no longer outstanding.
The Common Warrants are exercisable commencing on the date of Stockholder Approval at an exercise price of $1.00 per share. The Series A Warrants will expire five years from the date of Stockholder Approval and the Series B Warrants will expire twenty - four months from the date of Stockholder Approval. The Pre-Funded Warrants are exercisable immediately upon issuance at an exercise price of $0.001 per share and may be exercised at any time until the Pre-Funded Warrants are exercised in full. A holder of Pre-Funded Warrants or Common Warrants (together with its affiliates) may not exercise any portion of such warrants to the extent that the holder would own more than 4.99% (or, at the election of the holder 9.99%) of the Company’s outstanding Common Stock immediately after exercise.
In connection with the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”), dated as of October 8, 2024, with the Purchaser, pursuant to which the Company agreed to prepare and file a registration statement with the Securities and Exchange Commission (the “SEC”) registering the resale of the securities issued in the Private Placement no later than 10 days after the date of the Registration Rights Agreement, and to use its commercially reasonable efforts to have the registration statement declared effective as promptly as practical thereafter, and in any event no later than 30 days following the date of the Registration Rights Agreement (or 60 days following the date of the Registration Rights Agreement in the event of a “full review” by the SEC).
The Private Placement closed on October 10, 2024 (the “Closing Date”). The gross proceeds to the Company from the Private Placement were approximately $4.0 million, before deducting placement agent fees and offering expenses payable by the Company. The Company intends to use the net proceeds received from the Private Placement for general corporate purposes and working capital.
H.C. Wainwright & Co., LLC (“Wainwright”) acted as the Company’s exclusive placement agent in connection with the Private Placement, pursuant to that certain engagement letter, dated as of September 26, 2024, between the Company and Wainwright (the “Engagement Letter”). Pursuant to the Engagement Letter, the Company paid or agreed to pay Wainwright (i) a cash fee equal to 7.5% of the aggregate gross proceeds of the Private Placement, (ii) a management fee of 1.0% of the aggregate gross proceeds of the Private Placement, (iii) upon any exercise for cash of the Common Warrants, a cash fee of 7.5% of the aggregate gross exercise price paid in cash, and (iv) upon any exercise for cash of Common Warrants, a management fee of 1.0% of the aggregate gross exercise price paid in cash. In addition, the Company agreed to pay Wainwright certain expenses and issued to Wainwright or its designees warrants (the “Placement Agent Warrants”) to purchase up to an aggregate of 344,828 shares of Common Stock at an exercise price equal to $1.0875 per share. Upon any exercise for cash of the Common Warrants, the Company shall also issue warrants to Wainwright to purchase the number of shares of Common Stock equal to 7.5% of the aggregate number of such shares of Common Stock underlying the Warrants that have been so exercised at an exercise price equal to $1.0875 per share, which warrants will be in substantially the same form and on the same terms as the Placement Agent Warrants. The Placement Agent Warrants are exercisable starting on the date of Stockholder Approval and have a term of exercise equal to five years from the date of Stockholder Approval.
In connection with the Private Placement, the Company and the Purchaser agreed to cancel such Purchaser’s series A warrants to purchase 1,809,955 shares of common stock and series B warrants to purchase 1,809,955 shares of common stock issued to such Purchaser on June 5, 2024, effective as of the Closing Date.
