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Subsequent Events
12 Months Ended
Dec. 31, 2022
Subsequent Events [Abstract]  
Subsequent Events

9. Subsequent Events

Securities Purchase Agreement

On January 4, 2023, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with the institutional accredited investors named therein (the “Investors”), pursuant to which the Company agreed to issue and sell to the Investors in a private placement (the “Private Placement”) pre-funded warrants (the “Pre-Funded Warrants”) to purchase an aggregate of 30,909,090 shares (the “Warrant Shares”) of the Company’s common stock. Each Pre-Funded Warrant has an exercise price of $0.01 per Warrant Share. The purchase price per Pre-Funded Warrant was $0.54.

The Pre-Funded Warrants issued in the Private Placement provide that the holder of the Pre-Funded Warrants will not have the right to exercise any portion of its Pre-Funded Warrants if such holder, together with its affiliates and any other persons whose beneficial ownership of common stock would be aggregated with the holder for purposes of Section 13(d) or Section 16 of the Securities Exchange Act of 1934, as amended, would beneficially own in excess of 35% of the number of shares of common stock outstanding immediately after giving effect to such exercise. The Warrant Shares will also be subject to certain registration rights under the Company’s Amended and Restated Investors’ Rights Agreement.

The Private Placement closed on January 10, 2023. Gross proceeds of the Private Placement were approximately $16.7 million, before deducting offering expenses payable by the Company.

 

LianBio Agreement Amendment and Asset Purchase and Redemption Agreement

On February 28, 2023, the Company entered into an amendment (the “Amendment”) to the LianBio Agreement with Lian. Pursuant to the terms of the Amendment, the Company acknowledged acquisition of the ownership of certain Licensed Technology (as defined in the agreement) relating to its proprietary compound known as omilancor by NImmune Biopharma, Inc. (a corporation that was newly formed by Dr. Josep Bassaganya-Riera, Ph.D., former Chief Executive Officer of the Company, in connection with the transactions described below) and together with Lian provided that the LianBio Agreement no longer covers the licensing of Licensed Technology relating to omilancor. Furthermore, developmental milestone events were amended to reflect the transfer of Licensed Technology relating to omilancor.

On February 28, 2023, the Company entered into an Asset Purchase and Redemption Agreement (the “Purchase Agreement”) with Dr. Bassaganya-Riera, a related party who is the former Chief Executive Officer of the Company and a principal owner of the Company's common stock at the time of the transaction, Raquel Hontecillas and certain other stockholders (together the “Purchasers”) whereby Purchasers acquired (i) all of the Company’s right, title and interest in omilancor, LABP-104 and LABP-111 and any such derivatives and analogs that target LANCL proteins (together the “Acquired Compounds”), (ii) a worldwide, perpetual, irrevocable, fully-paid up, royalty-free, exclusive, sublicensable and transferable license grant under the intellectual property rights retained by the Company and necessary or useful for the development, manufacture and commercialization of the Acquired Compounds, (iii) a royalty agreement providing, among other things, for the payment by the Company to the Purchasers of a royalty of 2% of all net sales by the Company of any products containing certain compounds that the Company retained following the closing of the Purchase Agreement and (iv) $3,000,000 in cash in exchange for (x) 9,086,441 shares of the common stock of the Company held by the Purchasers and (y) a royalty agreement providing, among other things, for the payment by the Purchasers to the Company a royalty of 6% of all net sales by the Purchasers of any products containing any of the Acquired Compounds in consideration for the acquired intellectual property rights. The transactions contemplated by the Purchase Agreement closed simultaneously with signing.

Silicon Valley Bank

On March 10, 2023, Silicon Valley Bank ("SVB") was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation as receiver. At the time of the closure, the Company held a cash balance of low single digit millions of dollars in a deposit account with SVB. On March 15, 2023, the Company successfully transferred all funds from this SVB account to one of its other banks not affiliated with SVB without incurring any loss.