Item
1
.01
.
Entry into a Material Definitive Agreement.
Securities Purchase Agreement
On June 14, 2017, Viking Therapeutics, Inc. (the “Company”) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain accredited investors identified on the signature pages thereto (the “Purchasers”) pursuant to which the Company agreed to issue and sell an aggregate of 3,749,783 shares (the “Shares”) of its common stock, par value $0.00001 per share (the “Common Stock”), in a registered direct offering (the “Registered Direct Offering”). The Shares were offered by the Company pursuant to its shelf registration statement on Form S-3 (File No. 333-212134) filed with the Securities and Exchange Commission (the “Commission”) on June 20, 2016, as amended by Amendment No. 1 thereto filed with the Commission on July 26, 2016 and declared effective on July 26, 2016 (as amended, the “Registration Statement”).
In a concurrent private placement, the Company also agreed, pursuant to the Securities Purchase Agreement, to issue and sell to each of the Purchasers a warrant to purchase 0.75 shares of Common Stock (the “Warrants”) for each share of Common Stock purchased by a Purchaser in the Registered Direct Offering (the “Private Placement” and, together with the Registered Direct Offering, the “Offerings”). The exercise price of the Warrants is $1.30 per share, subject to adjustment as provided therein, and will be exercisable beginning on December 19, 2017 through December 19, 2022. Each holder of a Warrant will not have the right to exercise any portion of its Warrant 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 the Beneficial Ownership Limitation; however, in no event shall the Beneficial Ownership Limitation exceed 9.99%. The exercise price and number of shares of Common Stock issuable upon the exercise of the Warrants will be subject to adjustment in the event of any stock dividends and splits, reverse stock split, recapitalization, reorganization or similar transaction, as described in the Warrants. After December 19, 2017, if a registration statement covering the issuance or resale of the shares of common Stock issuable upon exercise of the Warrants (the “Warrant Shares”) is not available for the issuance or resale, as applicable, the Purchasers may exercise the Warrants by means of a “cashless exercise.”
The Warrants are not and will not be listed for trading on any national securities exchange. The Warrants and the Warrant Shares are not being registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Registration Statement.
The combined purchase price for one Share and one Warrant to purchase 0.75 shares of Common Stock in the Offerings was $1.15. The closing of the Offerings occurred on June 19, 2017. The Company expects the aggregate net proceeds from the Offerings, after deducting the placement agents’ fees and other estimated offering expenses, to be approximately $3.8 million. The Company intends to use the aggregate net proceeds for research and development, working capital and general corporate purposes.
The Securities Purchase Agreement contains customary representations, warranties and agreements by the Company and customary conditions to closing. Under the Securities Purchase Agreement, the Company has agreed, subject to certain exceptions, not to enter into any agreement to issue or announce the issuance or proposed issuance of any Common Stock or Common Stock equivalents for a period of 90 days following the closing of the Offerings.
Maxim Group LLC and Roth Capital Partners, LLC (the “Placement Agents”) acted as the placement agents for the Offerings. On June 14, 2017, the Company entered into a Placement Agent Agreement with the Placement Agents, pursuant to which the Placement Agents agreed to serve as the placement agents for the issuance and sale of the Shares and the Warrants, and the Company agreed to pay the Placement Agents an aggregate fee equal to 6.25% of the gross proceeds received by the Company in the Offerings. The Placement Agent Agreement includes indemnity and other customary provisions for transactions of this nature. Subject to certain conditions, the Company also agreed to reimburse all reasonable and documented
travel and other out-of-pocket expenses of the Placement Agents
actually incurred
in connection with the Offerings, which expenses shall be limited to, in the aggregate, $30,000.
The foregoing summaries of the Securities Purchase Agreement, the Warrants and the Placement Agent Agreement do not purport to be complete and are qualified in their entirety by reference to the full texts of the form of the Securities Purchase Agreement, the form of Warrant and the Placement Agent Agreement that are filed herewith as Exhibits 4.1, 10.1 and 10.2, respectively.
The representations, warranties and covenants contained in the
Securities Purchase Agreement, the Warrants and the Placement Agent Agree
ment
were made only for purposes of such agreement
s
and as of specific dates, were solely for the benefit of the parties to
the
Securities Purchase Agreement, the Warrants and the Placement Agent Agreement, respectively
, and may be subject to limitations agreed upon by the contracting parties. Accordingly,
the
Securities Purchase Agreement, the Warrants and the Placement Agent Agreement are
incorporated herein by reference only to provide investors with information regar
ding the terms of the
Securities Purchase Agreement, the Warrants and the Placement Agent Agreement,
and not to provide investors with any other factual information regarding
the Company
or its business, and should be read in conjunction with the disclosur
es in
the Company’s
periodic reports and other filings with the Commission.
The legal opinion, including the related consent, of Paul Hastings LLP relating to the legality of the issuance and sale of the Shares is filed as Exhibit 5.1 hereto.
This report does not constitute an offer to sell, or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements that involve risks and uncertainties, such as statements related to the amount of proceeds expected from the Offerings. The risks and uncertainties involved include the Company’s financial position, market conditions and other risks detailed from time to time in the Company’s periodic reports and other filings with the Commission. You are cautioned not to place undue reliance on forward-looking statements, which are based on the Company’s current expectations and assumptions and speak only as of the date of this Current Report on Form 8-K. The Company does not intend to revise or update any forward-looking statement in this Current Report on Form 8-K as a result of new information, future events or otherwise, except as required by law.