Item 3.02 Unregistered Sales of Equity Securities.
CytoDyn Inc., a Delaware corporation (the “Company”), is providing this disclosure under Item 3.02 because, as of November 17, 2021, its unregistered sales of equity securities, in the aggregate, exceeded 1% of the shares of its common stock, par value $0.001 per share (the “Common Stock”), outstanding as of October 31, 2021.
Private Warrant Exchanges
On November 9 and November 20, 2021, the Company entered into Warrant Exercise Inducement Agreements (the “Exercise Agreements”) with accredited investors, pursuant to which the investors purchased shares of Common Stock at prices ranging from $0.90 to $1.50 per share in exchange for warrants with exercise prices ranging from $0.45 to $0.75 per share. The Company issued approximately 0.3 million shares of common stock, as well as approximately 0.3 million additional shares as an inducement to the investors to exercise their warrants, for a total of approximately 0.5 million shares of common stock. Gross proceeds from these private warrant exchanges were approximately $0.3 million.
The form of Exercise Agreement was filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 7, 2021. The foregoing summary of the terms of the Exercise Agreement is subject to, and qualified in its entirety by, such document, which is incorporated herein by reference.
The shares issued pursuant to the Exercise Agreements were sold to accredited investors in reliance on the exemption provided by Rule 506 of Regulation D and Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”).
Private Placement of Shares of Common Stock and Warrants
On November 12 and 22, 2021, the Company issued in a private placement to accredited investors a total of approximately 1.4 million shares of Common Stock, together with warrants to purchase a total of approximately 0.3 million shares of Common Stock at an exercise price of $1.10 per share. The warrants have a five-year term and are immediately exercisable. The securities were issued with a combined purchase price of $1.10 per fixed combination of one share of Common Stock and one quarter of one warrant to purchase one share of Common Stock, for total gross proceeds to the Company of approximately $1.5 million.
Copies of the forms of warrant and subscription agreement were filed as Exhibits 4.1 and 10.1, respectively, to the Company’s Current Report on Form 8-K filed with the SEC on September 7, 2021. The foregoing summary of the terms of the forms of warrant and subscription agreement is subject to, and qualified in its entirety by, such documents.
The representations, warranties and covenants contained in the subscription agreements were made solely for the benefit of the parties to the subscription agreements. In addition, such representations, warranties and covenants (i) are intended as a way of allocating the risk between the parties to the subscription agreements and not as statements of fact, and (ii) may apply standards of materiality that are different from what may be viewed as material by stockholders of, or other investors in, the Company. Accordingly, the subscription