April 26, 2024
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Delaware | |||||||
(State or other jurisdiction of
| | | 3845 (Primary Standard Industrial Classification Code Number) | | | 36-4787690 (I.R.S. Employer Identification Number) | |
Phillip D. Torrence, Esq.
Meredith Ervine, Esq.
Honigman LLP
650 Trade Centre Way, Suite 200
Kalamazoo, Michigan 49002
| Phillip D. Torrence, Esq. Honigman LLP 650 Trade Centre Way, Suite 200 Kalamazoo, Michigan 49002 (269) 337-7700 | | | Mitchell S. Nussbaum, Esq. Angela M. Dowd, Esq. Loeb & Loeb LLP 345 Park Avenue New York, NY 10154 (212) 407-4159 | |
Approximate date of commencement of proposed sale to the public: From time to time
As soon as practicable after the effective date of this Registration Statement becomes effective, as determined by the selling stockholder.
Statement.
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Large accelerated filer | | | ☐ | | | Accelerated filer | | | ☐ | ||
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| Non-accelerated filer | | | ☒ | | | Smaller reporting company | | | ☒ | |
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| | | | | | | Emerging growth company | | | ☐ | |
CALCULATION OF REGISTRATION FEE
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Title of Each Class of Securities to Be Registered | Amount to be Registered(1) | Proposed Maximum Offering Price Per Share(2) | Proposed Maximum Offering Price(2) | Amount of Registration Fee | ||||
Class A common stock, par value $0.001 per share | 731,958 | $14.32 | $10,481,638.56 | $1,143.55 | ||||
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PROSPECTUS
731,9581,801,801 Shares of Common Stock
Series A Warrants to Purchase up to 1,801,801 Shares of Common Stock
Series B Warrants to Purchase up to 1,801,801 Shares of Common Stock
Pre-Funded Warrants to Purchase up to 1,801,801 Shares of Common Stock
symbol “HSDT”. On April 25, 2024, the last reported sales price for our Common Stock was $4.44 per share. The actual public offering price per share and accompanying Public Warrants will be determined between us, the Placement Agent and the investors in the offering, and may be at a discount to the current market price of our Common Stock. Therefore, the assumed public offering price used throughout this prospectus may not be indicative of the final public offering price. We do not intend to apply for listing of the Public Warrants or Pre-Funded Warrants on any national securities exchange or trading system. Without an active trading market, the liquidity of the Public Warrants and Pre-Funded Warrants will be limited.
Lincoln Park is an “underwriter” withintable below and to provide certain other compensation to the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended, or the Securities Act.
Lincoln Park may sell the shares of common stock described in this prospectus in a number of different ways and at varying prices.Placement Agent. See “Plan of Distribution” beginning on page 2630 of this prospectus for more information about how Lincoln Park may sellregarding these arrangements.
We have agreed to bear all of the expenses incurred in connection with the registration of the shares to which this prospectus relates. Lincoln Park will pay or assume discounts, commissions, and fees of underwriters, selling brokers or dealer managers, if any, incurred in connection with the sale of shares of our common stock.
Our common stock is listed on The Nasdaq Capital Market under the symbol “HSDT” and on the Toronto Stock Exchange “TSX” under the symbol “HSM”. However, we have applied to voluntarily delist our common stock from the TSX effective September 9, 2021. On September 2, 2021, the last reported sale price of our common stock as reported on The Nasdaq Capital Market was $15.15 per share.
Our business and investment in our common stock involve significant risks. These risks are described in the section titled “Risk Factors ” beginning on page 7 of this prospectus. You should also consider the risk factors described or referred to in any documents incorporated by reference in this prospectus, and in any applicable prospectus supplement, before investing in these securities.
Neither theU.S. Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
| | | Per Share and accompanying Series A Warrant and Series B Warrant | | | Per Pre-Funded Warrant and accompanying Series A Warrant and Series B Warrant | | | Total | | |||||||||
Public offering price | | | | $ | | | | | $ | | | | | $ | | | |||
Placement Agent fees(1) | | | | $ | | | | | $ | | | | | $ | | | |||
Proceeds to us before offering expenses(2) | | | | $ | | | | | $ | | | | | $ | | | |
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date—date - for example, a document incorporated by reference in this prospectus—prospectus - the statement in the document having the later date modifies or supersedes the earlier statement.We have not, and the selling stockholder has not, authorized anyone to provide you with any information other than that contained in or incorporated by reference in this prospectus, any prospectus supplement or in any related free writing prospectus filed by us with the SEC. any prospectus supplement, the documents incorporated by reference and any related free writing prospectus is accurate only as of their respective dates. Our business, financial condition, results of operations and prospects may have changed materially since those dates.
Inc
.companies
.targeted at reducing symptoms of neurological disease or trauma.
we have been seeking a business partner to commercialize and distribute PoNS in Australia.
NeuroHabilitation Corporation,
On June 13, 2014,Delaware.
On January 31, 2019, we formed another wholly owned subsidiary, Helius NeuroRehab, Inc., a Delaware corporation. On October 10, 2019, we formed Helius Canada Acquisition Ltd., a company incorporated under the federal laws of Canada and a wholly owned subsidiary of Helius Medical Technologies (Canada), Inc., a company incorporated under the federal laws of Canada, which acquired Heuro Canada, Inc. from Health Tech Connex Inc. on October 30, 2019.
Lincoln Park Transaction
On September 1, 2021, we and Lincoln Park entered into the Purchase Agreement and a registration rights agreement, or the Registration Rights Agreement. The Purchase Agreement provides that, subject to the terms and conditions set forth therein, we may sell to Lincoln Park up to $15.0 million of shares of common stock from time to time during the term of the Purchase Agreement. Pursuant to the terms of the Registration Rights Agreement, we have filed the registration statement that includes this prospectus with the Securities and Exchange Commission (the “SEC”) to register for resale under the Securities Act up to 731,958 shares of common stock that may be issued and sold by us to Lincoln Park under the Purchase Agreement.
Under the terms and subject to the conditions of the Purchase Agreement, the Company has the right, but not the obligation, to sell to Lincoln Park, and Lincoln Park is obligated to purchase up to $15.0 million of the Company’s Common Stock. Such sales of Common Stock by the Company, if any, will be subject to certain limitations set forth in the Purchase Agreement, and may occur from time to time, at the Company’s sole discretion, over the 36-month period commencing on the date that the conditions to Lincoln Park’s purchase obligation set forth in the Purchase Agreement are satisfied, including that the registration statement that includes this prospectus is declared effective by the SEC and a final prospectus relating thereto is filed with the SEC (the date on which all of such conditions are satisfied, the “Commencement Date”).
From and after the Commencement Date, on any business day selected by the Company on which the closing sale price of the Common Stock is not below $1.00, the Company may, by written notice delivered by us to Lincoln Park, direct Lincoln Park to purchase up to 20,000 shares of Common Stock on such business day, at a purchase price per share that will be determined and fixed in accordance with the Purchase Agreement at the time we deliver such written notice to Lincoln Park (each, a “Regular Purchase”), provided, however, that the maximum number of shares we may sell to Lincoln Park in a Regular Purchase may be increased to (i) up to 25,000 shares, provided that the closing sale price of the Common Stock on the applicable purchase date is not below $20.00 and (ii) up to 30,000 shares, provided that the closing sale price of the Common Stock on the applicable purchase date is not below $25.00 (each, of such share and dollar amounts subject to adjustment for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction as provided in the Purchase Agreement). In any case, however, Lincoln Park’s maximum purchase commitment in any single Regular Purchase may not exceed $2,000,000. The purchase price per share of Common Stock sold in each such Regular Purchase, if any, will be based on prevailing market prices of the Common Stock immediately preceding the time of sale as computed under the Purchase Agreement.
In addition to Regular Purchases, providedannounced that we have directed Lincoln Parkpartnered with Lovell Government Services (“Lovell”), an SBA-certified Service Disabled Veteran Owned Small Business (“SDVOSB”), to purchasemake the maximum amount of sharesPoNS device available to federal healthcare systems.
The Company will control the timing and amount of any sales of Common Stock to Lincoln Park pursuant to the Purchase Agreement. Lincoln Park has no right to require the Company to sell any shares of Common Stock to Lincoln Park, but Lincoln Park is obligated to make purchases as the Company directs, subject to certain conditions.
Actual sales of shares of Common Stock to Lincoln Park will depend on a variety of factors to be determined by the Company from time to time, including, among others, market conditions, the trading price of the Company’s Common Stock and determinations by the Company as to the appropriate sources of funding for the Company and its operations. The net proceeds under the Purchase Agreement to the Company will depend on the frequency and prices at which the Company sells shares of its stock to Lincoln Park. The Company expects that any proceeds received by the Company from such sales to Lincoln Park will be used for working capital and general corporate purposes.
A total of 731,958 shares of common stock that may be issued to the selling stockholder are being offered by this prospectus. Depending on the market prices of common stock at the various times the Company may elect to sell shares to the selling stockholder under the Purchase Agreement, the Company may be required, under the Registration Rights Agreement, to register for resale under the Securities Act additional shares of common stock that it may sell to the selling stockholder in order for it to receive the total commitment of $15,000,000 available under the Purchase Agreement.
Under applicable rules of the Nasdaq Capital Market the Company may not issue or sell to Lincoln Park under the Purchase Agreement more than 19.99%symbol “HSDT”.
In all instances, the Purchase Agreement prohibits the Company from directing Lincoln Park to purchase any shares of Common Stock if those shares, when aggregated with all other shares of Common Stock then beneficially owned by Lincoln Park (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 thereunder), would result in Lincoln Park beneficially owning more than 9.99% of the outstanding shares of Common Stock (the “Beneficial Ownership Cap”).
December 31, 2023. The Company has agreedhad no debt obligations outstanding at March 31, 2024.
As consideration for Lincoln Park’s irrevocable commitment to purchase shares of the Company’s Common Stock upon the terms ofour consolidated financial statements and subject to satisfaction of the conditions set forth in the Purchase Agreement, the Company agreed to issue 31,958 shares of its Common Stock to Lincoln Park as commitment shares (the
“Commitment Shares”), to be issued on the business day following the delisting of the Company’s Common Stock on the Toronto Stock Exchange, which the Company anticipates will occur on September 9, 2021. The Commitment Shares arerelated notes included in the 731,958 sharesconsolidated financial statements as of common stock registered underDecember 31, 2023 and 2022 and for each of the two years in the period ended December 31, 2023 incorporated by reference in this prospectus supplement. The unaudited preliminary financial data included in this registration statement has been prepared by, and is the responsibility of, which this prospectus forms a part.
The Purchase Agreement and the Registration Rights Agreement contain customary representations, warranties, conditions and indemnification obligations of the parties. The Company has the right to terminate the Purchase Agreement at any time with one business days’ notice, at no cost or penalty. During any “event of default” under the Purchase Agreement, Lincoln Park does not have the right to terminate the Purchase Agreement; however, the Company may not initiate any regular or other purchase of shares by Lincoln Park, until such event of default is cured. In addition, in the event of bankruptcy proceedings by or against the Company not discharged within 90 days, the Purchase Agreement will automatically terminate.
our management.
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Effective after
investment
.The sale or issuance of shares of
On September 1, 2021, we entered into the Purchase Agreement with Lincoln Park, pursuant to which Lincoln Park has committed to purchase from us up to $15.0 million of shares of our common stock at our discretion. As consideration for Lincoln Park’s commitment to purchase shares of our common stock at our direction under the Purchase Agreement, we agreed to issue 31,958 Commitment Shares to Lincoln Park on the business day next following the date our shares of common stock are delisted from the TSX.
The 731,958 shares of our common stock being registered for resale hereunder consist of (i) the 31,958 Commitment Shares to be issued to Lincoln Park for its commitment to purchase shares of our common stock at our direction under the Purchase Agreement, and (ii) up to 700,000 shares of our common stock that we may, in our sole discretion, elect to sell to Lincoln Park from time to time over the 36-month period commencing on the Commencement Date. The purchase price for the shares of our common stock that we may sell to Lincoln Park under the Purchase Agreement will fluctuate based on the public trading price of our common stock. Depending on market liquidity at the time, sales of such shares of our common stock may cause the public trading price of our common stock to decrease.
We generally have the right to control the timing and amount of any future sales of shares of our common stock to Lincoln Park. Sales of shares of our common stock, if any, to Lincoln Park will depend upon market conditions and other factors to be determined by us. We may ultimately decide to sell to Lincoln Park all, some or none of the additional shares of our common stock that may be available for us to sell pursuant to the Purchase Agreement. Therefore, sales to Lincoln Park by us could result in substantial dilution to the interests of other holders of our common stock. Additionally, the sale of a substantial number of shares of our common stock to Lincoln Park, or the anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales. If and when we do sell shares of our common stock to Lincoln Park, after Lincoln Park has acquired the shares of common stock, Lincoln Park may resell all, some or none of those shares of common stock at any time or from time to time in its discretion.
We may not have access to the full amount available under the Purchase Agreement with Lincoln Park.
Although the Purchase Agreement provides that we may sell up to $15.0 million of shares of common stock to Lincoln Park, only 731,958 of the shares of common stock that may be issued to Lincoln Park are being offered under this prospectus, of which (i) 31,958 shares represent the Commitment Shares to be issued to Lincoln Park
for its commitment to purchase shares of our common stock at our direction under the Purchase Agreement and (ii) up to 700,000 shares of our common stock that we may, in our sole discretion, elect to sell to Lincoln Park from time to time over the 36-month period commencing on the Commencement Date. As a result, depending on the market prices of our common stock at the times we elect to issue and sell shares to Lincoln Park under the Purchase Agreement, if any, we may need to issue and sell to Lincoln Park under the Purchase Agreement more than the 700,000 purchase shares being registered for resale by Lincoln Park under the registration statement that includes this prospectus, in order to receive proceeds equal to the $15,000,000 total purchase commitment available to us under the Purchase Agreement. In such case, before we can sell any additional shares to Lincoln Park, we will need to register for resale under the Securities Act such additional shares of common stock, which will require additional time, resources and cost to us. In addition, the issuance and sale of such additional shares of common stock by the Company to Lincoln Park under the Purchase Agreement could cause substantial dilution to our stockholders.
In addition, under the rules of the Nasdaq Capital Market and the terms of the Purchase Agreement, in no event may we issue or sell to Lincoln Park under the Purchase Agreement shares of our common stock in excess of the Exchange Cap of 463,321 shares (including the 31,958 Commitment Shares), which represents 19.99% of the shares of our common stock outstanding (based on 2,317,772 shares outstanding) immediately prior to the execution of the Purchase Agreement, unless (i) we obtain stockholder approval to issue shares of our common stock in excess of the Exchange Cap or (ii) the average price of all applicable sales of our common stock to Lincoln Park under the Purchase Agreement equals or exceeds $15.1661 per share, so that such issuances and sales would be exempt from the Exchange Cap limitation under applicable Nasdaq rules. In addition, Lincoln Park cannot be required to purchase any shares of our common stock if such purchase would cause Lincoln Park’s beneficial ownership of our common stock to exceed the Beneficial Ownership Cap. Our inability to access a portion or the full amount available under the Purchase Agreement, in the absence of any other financing sources, could have a material adverse effect on our business.
Our management will have broad discretion over the use ofand flexibility in how the net proceeds if any, from this offering are used, our sale of shares of common stock to Lincoln Park,management may use the net proceeds in ways with which you disagree or which may not agree with how weprove effective.
Our management will have broad discretion as to the useallocated specific amounts of the net proceeds from this offering for any of the foregoing purposes. Accordingly, our sale of shares of common stock to Lincoln Park,management will have significant discretion and we could use them for purposes other than those contemplated atflexibility in applying the time of commencementnet proceeds of this offering. Accordingly, youYou will be relying on the judgment of our management with regard to the use of thosethese net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the net proceeds are being used appropriately. It is possible that pending their use, we may invest thosethe net proceeds will be invested in a way that does not yield a favorable, or any, return for us. The failure of our management to use such funds effectively could have a material adverse effect on our business, financial condition, operating results and cash flows.
Our independent registered public accounting firm has included an explanatory paragraph relating to our ability to continue as a going concern in its report on our audited financial statements. Even if this offering is successfully completed, we may be unable to continue to operate without the threat of liquidation for the foreseeable future.
PCT application | | | US Priority document(s) (filing date) | | | Foreign patents/ *patent applications | |
WO2016/089751A1 (PCT/US2015/062950) | | | 14/559,080 (3 December 2014) 14/559,123 (3 December 2014) 14/559,118 (3 December 2014) 14/559,105 (3 December 2014) | | | AU2015355211B2 AU2017218934B2 AU2017276270B2 AU2018204184B2 | |
Title: Systems and Methods for Providing Non-Invasive Neurorehabilitation of a Patient | | | | | | AU2018247259B2 CA2969729C EP3226962B1 EP3662969B1 IL252648B | |
WO2016/089752A1 (PCT/US2015/062953) | | | 14/557,787 (3 December 2014) 14/557,789 (3 December 2014) 14/559,045 (3 December 2014) | | | AU2015355212B2 AU2017228517B2 AU2019200175B2 AU2019246836B2 | |
Title: Devices for Delivering Non-Invasive Neuromodulation to a Patient | | | | | | CA2969731C EP3226961B1 EP19190373.1A* IL252649A0 | |
WO2016/089795A1 (PCT/US2015/063059) | | | 14/559,080 (3 December 2014) 14/559,123 (3 December 2014) 14/559,118 (3 December 2014) 14/559,105 (3 December 2014) | | | N/A | |
Title: Methods of Manufacturing Devices for the Neurorehabilitation of a Patient | | | | | | | |
WO2020/176954 (PCT/US2020/019853) | | | 62/812,185 (28 February 2019) | | | AU2020228618A1* CA3131684A1* CN113728393A* | |
Title: Computer Systems and Methods for Enhancing Neurorehabilitation | | | | | | EP20712806.7A* IL285901A* UK2596678B | |
Mark | | | Country | | | Registration Number | | | Application Number | |
PONS | | | U.S. | | | 4,998,391 | | | 86978547 | |
PONS | | | U.S. | | | 5,845,725 | | | 86440699 | |
PONS THERAPY | | | U.S. | | | 7,219,613 | | | 97124824 | |
HELIUS | | | U.S. | | | 7,231,015 | | | 88443662 | |
HELIUS MEDICAL | | | U.S. | | | pending | | | 88443664 | |
PONS | | | Australia | | | 1923122 | | | 1923122 | |
Mark | | | Country | | | Registration Number | | | Application Number | |
HELIUS | | | Canada | | | pending | | | 1996550 | |
PONS | | | Europe | | | 15004799 | | | 15004799 | |
PONS | | | Israel | | | 306606 | | | 306606 | |
PONS | | | New Zealand | | | 1091833 | | | 1091833 | |
PONS | | | Russia | | | 634298 | | | 2015712398 | |
PONS | | | Russia | | | 674026 | | | 2010729117 | |
PONS | | | Russia | | | 653065 | | | 2017727589 | |
infrastructure.
in this prospectus and in the documents incorporated herein by reference.
This prospectus supplement contains and incorporates by reference certain market data and industry statistics and forecasts
This prospectus relatesthere is no minimum offering amount required as a condition to the sharesclosing of common stock thatthis offering, the actual offering amount, Placement Agent’s fees and net proceeds to us are not presently determinable and may be offered and sold from timesubstantially less than the maximum amounts set forth on the cover page of this prospectus.
However, we may receive up to $15.0 million in aggregate gross proceeds under the Purchase Agreement from any sales of common stock we make to Lincoln Park pursuant to the Purchase Agreement after the date of prospectus. Any proceeds we receive from our sale of shares of common stock to Lincoln Park under the Purchase Agreement will be usedthis offering for funding operations, working capital and general corporate purposes.
We have not determinedmay use a portion of the amount of net proceeds for the acquisitions of businesses, products, technologies or licenses that are complementary to be used specifically for such purposes. As a result, management will retain broad discretion over the allocation of any proceeds from the sale of any shares of our common stock under the Purchase Agreement.
business, although we have no present commitments or agreements to do so.
•
Additional capital may not be available on terms favorable to us, or at all. If we raise additional funds by issuing equity securities, our stockholders may experience dilution. Debt financing, if available, may involve restrictive covenants or additional security interests in our assets. Any additional debt or equity financing that we complete may contain terms that are not favorable to us or our stockholders. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish some rights to our technologies or products or grant licenses on terms that are not favorable to us. If we are unable to raise adequate funds, we may have to delay, reduce the scope of, or eliminate some or all of, our development programs or liquidate some or all of our assets.
| | | As of December 31, 2023 (in thousands) | | |||||||||
| | | Actual | | | As adjusted | | ||||||
Cash and cash equivalents | | | | $ | 5,182 | | | | | $ | 12,292 | | |
Stockholders’ (deficit) equity: | | | | | | | | | | | | | |
Preferred Stock, $0.001 par value; 10,000,000 shares authorized; no shares issued and outstanding as of December 31, 2023 | | | | | — | | | | | | — | | |
Class A Common Stock, $0.001 par value, 150,000,000 shares authorized; actual 714,590 shares issued and outstanding as of December 31, 2023; as adjusted 2,516,391 shares issued and outstanding as of December 31, 2023 | | | | | 1 | | | | | | 3 | | |
Additional paid-in capital | | | | | 162,979 | | | | | | 170,087 | | |
Accumulated other comprehensive loss | | | | | (673) | | | | | | (673) | | |
Accumulated deficit | | | | | (159,957) | | | | | | (159,957) | | |
Total stockholders’ equity | | | | $ | 2,350 | | | | | $ | 9,460 | | |
Common Stock after this offering. Net tangible book value per share prior to this offering is equal to our total tangible assets minus total liabilities, all divided by 2,317,772714,590 shares of common stockCommon Stock outstanding at June 30, 2021.December 31, 2023. Our historical net tangible book value as of June 30, 2021December 31, 2023 was approximately $7.1$2.3 million, or $3.08$3.25 per share of our common stock.
After giving effect to (i) the issuanceCommon Stock. As of 31,958 shares ofDecember 31, 2023, our common stock to Lincoln Park as Commitment Shares and (ii) the sale of 700,000 shares of our common stock to Lincoln Park pursuant to the Purchase Agreement at an assumed sale price of $14.49 per share of our common stock (which represents the closing price of our common stock on September 1, 2021) and after deducting estimated offering expenses payable by us, our as-adjustedadjusted net tangible book value as of June 30, 2021 would have been approximately $17.2was $9.4 million, or $5.63$3.75 per share.
| Assumed public offering price per share (attributing no value to the Public Warrants) | | | | $ | 4.44 | | |
| Net tangible book value per share as of December 31, 2023 | | | | $ | 3.25 | | |
| Increase in as adjusted net tangible book value per share after this offering | | | | $ | 0.50 | | |
| Adjusted net tangible book value per share after giving effect to this offering | | | | $ | 3.75 | | |
| Dilution in adjusted net tangible book value per share to new investors | | | | $ | (0.69) | | |
Theoffering by $0.17, assuming the number of shares of common stockCommon Stock offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the Placement Agent fees and commissions and estimated offering expenses payable by us.
631,016 shares of common stockCommon Stock issuable upon exercise of the Warrants being offered by this prospectus and also excludes the following as of that date:
593,924
an aggregate of 100,000
an aggregate of 8,290 restricted stock units outstanding as of June 30, 2021.
General
On September 1, 2021, we entered into the Purchase Agreement with Lincoln Park, pursuant to which Lincoln Park has agreed to purchase from us up to an aggregate of $15.0 million
This prospectus covers the resale by the selling stockholderboard of up to 731,958 sharesdirectors out of our common stock, comprised of: (i) 31,958 Commitment Shares that we agreed to issue to Lincoln Park as a fee for making its irrevocable commitment to purchase our common stock under the Purchase Agreement, one business day following the delisting of our common stock from the TSX, and (ii) up to an additional 700,000 shares of our common stock that welegally available funds.
Other than the Commitment Shares that we agreed to issue to Lincoln Park following the delisting of our common stock from the TSX as a fee for making its irrevocable commitment to purchase our common stock under the Purchase Agreement, we do not have the right to commencedeclared or paid any sales of our common stock to Lincoln Park under the Purchase Agreement until all of the conditions set forthdividends in the Purchase Agreement have been satisfied on the Commencement Date, including that the SEC has declared effective the registration statement that includes this prospectus and the delisting of our common stock from the TSX. From and after the Commencement Date, we may, from time to time and at our sole discretion for a period of 36-months, on any business day that we select on which the closing sale price of our common stock equals or exceeds $1.00 per share, direct Lincoln Park to purchase in a Regular Purchase up to 20,000 shares of our common stock, which amount may be increased depending on the market price of our common stock at the time of sale, subject to a maximum commitment of $2,000,000 per Regular Purchase. In addition, at our discretion, Lincoln Park has committed to purchase other “accelerated amounts” and/or “additional accelerated amounts” under certain circumstances. We will control the timing and amount of any sales of our common stock to Lincoln Park. The purchase price of the shares of our common stock that may be sold to Lincoln Park in Regular Purchases under the Purchase Agreement will be based on the market price of our common stock immediately preceding the time of sale as computed under the Purchase Agreement. The purchase price per share will be equitably adjusted as provided in the Purchase Agreement for any reorganization, recapitalization, non-cash dividend, stock split, or other similar transaction as set forth in the Purchase Agreement. We may at any time in our sole discretion terminate the Purchase Agreement without fee, penalty or cost upon one business day notice. There are no restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement or Registration Rights Agreement, other than restrictions on our ability to enter into additional “equity line” or a substantially similar transaction whereby a specific investor is irrevocably bound pursuant to an agreement with us to purchase securities over a period of time from us at a price based on the market price of our common stock at the time of such purchase). Lincoln Park may not assign or transfer its rights and obligations under the Purchase Agreement.
As of September 1, 2021, there were 2,317,772 shares of our common stock outstanding, of which 2,199,970 shares of our common stock were held by non-affiliates. Although the Purchase Agreement provides that we may sell up to an aggregate of $15.0 million of our common stock to Lincoln Park, only 731,958 shares of our common stock are being registered for resale under this prospectus, which represents the 31,958 Commitment Shares that we agreed to issue to Lincoln Park as a fee for making its irrevocable commitment to purchase our common stock under the Purchase Agreement and an additional 700,000 shares of our common stock that we
may issue and sell to Lincoln Park in the future under the Purchase Agreement, if and when we sell shares of our common stock to Lincoln Park under the Purchase Agreement. Depending on the market prices of our common stock at the time we elect to issue and sell shares of our common stock to Lincoln Park under the Purchase Agreement, we may need to register for resale under the Securities Act additional shares of our common stock in order to receive aggregate gross proceeds equalpast to the $15.0 million total commitment available to us under the Purchase Agreement.. If we elect to issue and sell to Lincoln Park under the Purchase Agreement more than the additional 700,000 shares of our common stock being registered for resale by Lincoln Park under this prospectus, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional shares of our common stock, which could cause additional substantial dilution to our stockholders. The number of shares of our common stock ultimately offered for resale by Lincoln Park is dependent upon the number of shares of our common stock we ultimately decide to sell to Lincoln Park under the Purchase Agreement.
Under applicable Nasdaq rules, in no event may we issue or sell to Lincoln Park under the Purchase Agreement shares of our common stock in excess of the Exchange Cap of 463,321 shares (including the 31,958 Commitment Shares), which represents 19.99% of the shares of our common stock outstanding (based on 2,317,772 shares outstanding) immediately prior to the execution of the Purchase Agreement, unless (i) we obtain stockholder approval to issue shares of our common stock in excess of the Exchange Cap or (ii) the average price of all applicable sales of our common stock to Lincoln Park under the Purchase Agreement equals or exceeds $15.1661 per share, so that such issuances and sales would be exempt from the Exchange Cap limitation under applicable Nasdaq rules. In any event, the Purchase Agreement specifically provides that we may not issue or sell any shares of our common stock under the Purchase Agreement if such issuance or sale would breach any applicable rules or regulations of The Nasdaq Stock Market.
The Purchase Agreement prohibits us from directing Lincoln Park to purchase any shares of our common stock if those shares of our common stock, when aggregated with all other shares of our common stock then beneficially owned by Lincoln Park and its affiliates, would cause Lincoln Park’s beneficial ownership of our common stock to exceed the Beneficial Ownership Cap.
Issuances of our common stock to Lincoln Park under the Purchase Agreement will not affect the rights or privileges of our existing stockholders, except that the economic and voting interests of each of our existing stockholders will be diluted as a result of any such issuance. Although the number of shares of our common stock that our existing stockholders own will not decrease, the shares of our common stock owned by our existing stockholders will represent a smaller percentage of our total outstanding shares of our common stock after any such issuance of shares of our common stock to Lincoln Park under the Purchase Agreement.
Purchase of Sharesholders of our Common Stock underand do not currently anticipate declaring or paying any dividends in the Purchase Agreement
Underforeseeable future. We intend to retain earnings, if any, to finance the Purchase Agreement, fromdevelopment and after commencement, on any business day that we select on which the closing sale priceexpansion of our common stock equals or exceeds $1.00 per share,business. Future dividend policy will be subject to adjustment, we may direct Lincoln Park to purchase up to 20,000 sharesthe discretion of our common stock in a Regular Purchase on such business day, provided, however, that the Regular Purchase may be increased to up to 25,000 sharesboard of our common stock, provided that the closing sale price of our common stock is not below $20.00 on the purchase date, or up to 30,000 shares of our common stock, provided that the closing sale price of our common stock is not below $25.00 (the “Regular Purchase Share Limit”). In each case, Lincoln Park’s maximum commitment in any single Regular Purchase may not exceed $2,000,000. The Regular Purchase Share Limit is subject to proportionate adjustment in the event of a reorganization, recapitalization, non-cash dividend, stock split or other similar transaction; provided, that if after giving effect to such full proportionate adjustment, the adjusted Regular Purchase Share Limit would preclude us from requiring Lincoln Park to purchase shares of our common stock at an aggregate purchase price equal to or greater than $150,000 in any single Regular Purchase, then the Regular Purchase Share Limit will not be fully adjusted, but rather the Regular Purchase Share Limit for such Regular
Purchase shall be adjusted as specified in the Purchase Agreement, such that, after giving effect to such adjustment, the Regular Purchase Share Limitdirectors and will be equal to (or as close as can be derived from such adjustment without exceeding) $150,000.
The purchase price per share for each such Regular Purchase will be equal to the lower of:
the lowest sale price for our common stock on the purchase date for such shares of our common stock; and
the arithmetic average of the three lowest closing sale prices for our common stock during the 10 consecutive business days ending on the business day immediately preceding the purchase date of such shares of our common stock.
In addition to Regular Purchases described above, we may also direct Lincoln Park, on any business day on which we have properly submitted a Regular Purchase notice directing Lincoln Park to purchase the maximum number of shares of our common stock that we are then permitted to include in a single Regular Purchase notice, to purchase an additional amount of our common stock, which we refer to as an Accelerated Purchase, not to exceed the lesser of:
30% of the aggregate number of shares of our common stock traded during all or, if certain trading volume or market price thresholds specified in the Purchase Agreement are crossed on the applicable Accelerated Purchase date, which is defined as the next business day following the purchase date for the corresponding Regular Purchase, the portion of the normal trading hours on the applicable Accelerated Purchase date prior to such time that any one of such thresholds is crossed, which period of time on the applicable Accelerated Purchase date we refer to as the Accelerated Purchase Measurement Period; and
300% of the number of purchase shares purchased pursuant to the corresponding Regular Purchase.
The purchase price per share for each such Accelerated Purchase will be equal to the lower of:
96% of the volume weighted average price of our common stock during the Accelerated Purchase Measurement Period on the applicable Accelerated Purchase date; and
the closing sale price of our common stock on the applicable Accelerated Purchase date.
We may also direct Lincoln Park, not later than 1:00 p.m., Eastern time, on a business day on which an Accelerated Purchase has been completed and all of the shares of our common stock to be purchased thereunder (and under the corresponding Regular Purchase) have been properly delivered to Lincoln Park in accordance with the Purchase Agreement prior to such time on such business day, to purchase an additional amount of our common stock, which we refer to as an Additional Accelerated Purchase, of up to the lesser of:
30% of the aggregate number of shares of our common stock traded during a certain portion of the normal trading hours on such Accelerated Purchase date as determined in accordance with the Purchase Agreement, which period of time we refer to as the Additional Accelerated Purchase Measurement Period; and
300% of the number of purchase shares purchased pursuant to the Regular Purchase corresponding to the Accelerated Purchase that was completed on such Accelerated Purchase date on which an Additional Accelerated Purchase notice was properly received.
We may, in our sole discretion, submit multiple Additional Accelerated Purchase notices to Lincoln Park prior to 1:00 p.m., Eastern time, on a single Accelerated Purchase date, provided that all prior Accelerated Purchases and Additional Accelerated Purchases (including those that have occurred earlier on the same day) have been completed and all of the shares of our common stock to be purchased thereunder (and under the corresponding Regular Purchase) have been properly delivered to Lincoln Park in accordance with the Purchase Agreement.
The purchase price per share for each such Additional Accelerated Purchase will be equal to the lower of:
96% of the volume weighted average price of our common stock during the applicable Additional Accelerated Purchase Measurement Period on the applicable Additional Accelerated Purchase date; and
the closing sale price of our common stock on the applicable Additional Accelerated Purchase date.
In the case of Regular Purchases, Accelerated Purchases and Additional Accelerated Purchases, the purchase price per share will be equitably adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction occurring during the business days used to compute the purchase price.
Other than as described above, there are no trading volume requirements or restrictions under the Purchase Agreement, and we will control the timing and amount of any sales of our common stock to Lincoln Park.
Events of Default
Events of default under the Purchase Agreement include the following:
the effectiveness of the registration statement of which this prospectus forms a part lapses for any reason (including, without limitation, the issuance of a stop order), or any required prospectus supplement and accompanying prospectus are unavailable for the resale by Lincoln Park of our common stock offered hereby, and such lapse or unavailability continues for a period of 10 consecutive business days or for more than an aggregate of 30 business days in any 365-day period;
suspension by our principal market of our common stock from trading for a period of one business day;
the de-listing of our common stock from the Nasdaq Capital Market, our principal market, provided our common stock is not immediately thereafter trading on the New York Stock Exchange, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the NYSE American, the NYSE Arca, or the OTCQX Best Market or the OTCQB Venture Market operated by OTC Markets Group Inc. (or nationally recognized successor thereto);
the failure of our transfer agent to issue to Lincoln Park shares of our common stock within two business days after the applicable date on which Lincoln Park is entitled to receive such shares of our common stock;
any breach of the representations or warranties or covenants contained in the Purchase Agreement or Registration Rights Agreement that has or could have a material adverse effect on us and, in the case of a breach of a covenant that is reasonably curable, that is not cured within five consecutive business days;
any voluntary or involuntary participation or threatened participation in insolvency or bankruptcy proceedings by or against us;
if at any time we are not eligible to transfer our common stock electronically; or
if at any time the Exchange Cap (to the extent applicable under the terms of the Purchase Agreement) is reached and our stockholders have not approved the issuance of common stock in excess of the Exchange Cap in accordance with applicable Nasdaq rules.
Lincoln Park does not have the right to terminate the Purchase Agreementcontingent upon any of the events of default set forth above. During an event of default, all of which are outside of Lincoln Park’s control, we may not direct Lincoln Park to purchase any shares of our common stock under the Purchase Agreement.
Our Termination Rights
We have the unconditional right, at any time, for any reason and without any payment or liability to us, to give notice to Lincoln Park to terminate the Purchase Agreement. In the event of bankruptcy proceedings by or against us, the Purchase Agreement will automatically terminate without action of any party.
No Short-Selling or Hedging by Lincoln Park
Lincoln Park has agreed that neither it nor any of its affiliates shall engage in any direct or indirect short-selling or hedging of our common stock during any time prior to the termination of the Purchase Agreement.
Prohibitions on Similar Financings
Subject to specified exceptions included in the Purchase Agreement, we are limited in our ability to enter into any new “equity line” or similar transaction whereby an investor is irrevocably bound to purchase securities over a period of time from us at a price based on the market price of our common stock at the time of such purchase.
Effect of Performance of the Purchase Agreement on Our Stockholders
All shares of our common stock being registered for resale hereunder which may be issued or sold by us to Lincoln Park under the Purchase Agreement are expected to be freely tradable. It is anticipated that shares registered in this offering will be sold from time to time over a period of up to 36-months commencing on the date that the registration statement including this prospectus becomes effective. The sale by Lincoln Park of a significant amount of shares of our common stock registered in this offering at any given time could cause the market price of our common stock to decline and to be highly volatile. Sales of our common stock to Lincoln Park,future earnings, if any, will depend upon marketour financial condition, capital requirements, general business conditions, and other factorsfactors. Therefore, we can give no assurance that any dividends of any kind will ever be paid to be determined by us. We may ultimately decide to sell to Lincoln Park all, some or none of the additional shares of our common stock that may be available for us to sell pursuant to the Purchase Agreement. If and when we do sell additional shares of our common stock to Lincoln Park, after Lincoln Park has acquired the shares of our common stock, Lincoln Park may resell all, some or none of those shares of our common stock at any time or from time to time in its discretion. Therefore, sales to Lincoln Park by us under the Purchase Agreement may result in substantial dilution to the interests of other holders of our common stock. In addition, if we sell a substantial number of shares of our common stock to Lincoln Park under the Purchase Agreement, or if investors expect that we will do so, the actual sales of shares of our common stock or the mere existence of our arrangement with Lincoln Park may make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect such sales. However, we have the right to control the timing and amount of any additional sales of our common stock to Lincoln Park and the Purchase Agreement may be terminated by us at any time at our discretion without any cost to us.
Pursuant to the terms of the Purchase Agreement, from and after commencement, we have the right, but not the obligation, from time to time to direct Lincoln Park to purchase up to $15.0 million of our common stock. Depending on the price per share at which we sell our common stock to Lincoln Park pursuant to the Purchase Agreement, we may need to sell to Lincoln Park under the Purchase Agreement more shares of our common stock than are being offered under this prospectus in order to receive aggregate gross proceeds equal to the $15.0 million total commitment available to us under the Purchase Agreement. If we choose to do so, we must first register for resale under the Securities Act such additional shares of our common stock, which could cause additional substantial dilution to our stockholders. The number of shares of our common stock ultimately offered for resale by Lincoln Park under this prospectus is dependent upon the number of shares of our common stock we direct Lincoln Park to purchase under the Purchase Agreement.
The Purchase Agreement prohibits us from issuing or selling to Lincoln Park under the Purchase Agreement (i) shares of our common stock in excess of the Exchange Cap, unless we obtain stockholder approval to issue shares in excess of the Exchange Cap or the average price of all applicable sales of our common stock to Lincoln
Park under the Purchase Agreement equals or exceeds $15.1661 per share, such that the transactions contemplated by the Purchase Agreement are exempt from the Exchange Cap limitation under applicable Nasdaq rules and (ii) any shares of our common stock if those shares, when aggregated with all other shares of our common stock then beneficially owned by Lincoln Park, would exceed 9.99%.
The following table sets forth the amount of gross proceeds we would receive from Lincoln Park from our sale of up to 700,000 shares of our common stock that we are registering hereby that we may issue and sell to Lincoln Park in the future under the Purchase Agreement at varying purchase prices from and after commencement:
Assumed Average | Number of Registered Shares of our Common Stock to be Issued if Full Purchase(1) | Percentage of Outstanding Shares of our Common Stock After Giving Effect to the Issuance to Lincoln Park(2) | Gross Proceeds from the Sale of Shares of our Common Stock to Lincoln Park Under the Purchase Agreement(1) | |||||||||
$1.00 | 700,000 | 23.0 | % | $ | 700,000 | |||||||
$5.00 | 700,000 | 23.0 | % | $ | 3,500,000 | |||||||
$10.00 | 700,000 | 23.0 | % | $ | 7,000,000 | |||||||
$14.49 (3) | 700,000 | 23.0 | % | $ | 10,143,000 | |||||||
$15.00 | 700,000 | 23.0 | % | $ | 10,500,000 | |||||||
$20.00 | 700,000 | 23.0 | % | $ | 14,000,000 | |||||||
$25.00 | 600,000 | 20.3 | % | $ | 15,000,000 |
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This prospectus relates to the possible resale by the selling stockholder, Lincoln Park, of shares of our common stock that may be issued to Lincoln Park pursuant to the Purchase Agreement. We are filing the registration statement of which this prospectus is a part pursuant to the provisions of the Registration Rights Agreement, which we entered into with Lincoln Park on September 1, 2021 concurrently with our execution of the Purchase Agreement, in which we agreed to provide certain registration rights with respect to sales by Lincoln Park of the shares of our common stock that may be issued to Lincoln Park under the Purchase Agreement.
Lincoln Park, as the selling stockholder, may, from time to time, offer and sell pursuant to this prospectus up to 731,958 shares of our common stock that we have issued or may issue to Lincoln Park under the Purchase Agreement. The selling stockholder may sell some, all or none of the shares of common stock. We do not know how long the selling stockholder will hold the shares of our common stock before selling them, and we currently have no agreements, arrangements or understandings with the selling stockholder regarding the sale of any of the shares of common stock. See “Plan of Distribution.”
The table below sets forth, to our knowledge, information concerning the beneficial ownership of shares of our common stock by the selling stockholder as of September 1, 2021. The percentages of shares owned before and after the offering are based on 2,317,772 shares of common stock outstanding as of September 1, 2021, which includes the Commitment Shares we agreed to issue to Lincoln Park that are offered by this prospectus. The information in the table below with respect to the selling stockholder has been obtained from the selling stockholder.
Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to shares. Unless otherwise indicated below, to our knowledge, all persons named in the table have sole voting and investment power with respect to their shares of common stock. The inclusion of any shares in this table does not constitute an admission of beneficial ownership for the person named below.
Throughout this prospectus, when we refer to the shares of common stock being offered by this prospectus on behalf of the selling stockholder, we are referring to the shares of common stock sold pursuant to the Purchase Agreement unless otherwise indicated.
Name of Selling Stockholder | Shares Beneficially Owned Prior to Offering | Percentage of Shares Beneficially Owned Prior to Offering | Shares to be Sold in this Offering Assuming We Issue the Maximum Number of Shares Under the Purchase Agreement (3) | Percentage of Shares to be Beneficially Owned After Offering | ||||||||||||
Lincoln Park Capital Fund, LLC (1) | 47,984 | (2) | 2.1 | % | 731,958 | * | % |
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.Common Stock
Rights and Preferences
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tender offers for our shares and may have the effect of delaying changes in our control or management. As a consequence, these provisions may also inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover attempts. We believe that the benefits of these provisions, including increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure our company,Company, outweigh the disadvantages of discouraging takeover proposals, because negotiation of takeover proposals could result in an improvement of their terms.
Participation Rights of Investors in October 2020 Private Placement
Pursuant to the securities purchase agreement for the October 2020 Private Placement, as amended, if we issue any shares of common stock or common stock equivalents for cash consideration, indebtedness or a combination thereof, with certain exceptions (including equity line of credit transactions), within twelve months of the closing of the private placement, each purchaser who subscribed for at least $250,000 in the private placement has the right to participate in up to such purchaser’s pro rata portion of 30% of the such subsequent financing on the same terms, conditions and price provided for in the subsequent financing.
The
Common Stock Listing
Thesuch holder’s ownership of shares of our commonCommon Stock, the holders of the Series A Warrants and the Series B Warrants do not have the rights or privileges of holders of our Common Stock, including any voting rights, until they exercise their Series A Warrants or Series B Warrants.
| | | Per Share and accompanying Series A Warrant and Series B Warrant | | | Per Pre-Funded Warrant and accompanying Series A Warrant and Series B Warrant | | | Total | | |||||||||
Public Offering Price | | | | $ | | | | | $ | | | | | $ | | | |||
Placement agent fees | | | | $ | | | | | $ | | | | | $ | | | |||
Proceeds, before expenses, to us | | | | $ | | | | | $ | | | | | $ | | | |
ordinary brokers’ transactions;
transactions involving crossLock-Up Agreements
through brokers, dealers,
“atotherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the market”Company or (2) file or caused to be filed any registration statement with the SEC relating to the offering of any shares of our capital stock or any securities convertible into or exercisable or exchangeable for shares of our capital stock.
existing at-the-market at sales prices equal to or in other ways not involving market makers or established business markets, including direct sales to purchasers or sales effected through agents;
in privately negotiated transactions; or
any combinationexcess of the foregoing.
In orderpublic offering price. Any purchaser shall be entitled to comply withobtain injunctive relief against us to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
Lincoln Park is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act.
Lincoln Park has informed us that it intends to use an unaffiliated broker-dealer to effectuate all sales, if any, of our common stock that it has acquired and may in the future acquire from us pursuant to the Purchase Agreement. Such sales will be made at prices and at terms then prevailing or at prices related to the then current market price. Each such unaffiliated broker-dealer will be an underwriter within the meaning of Section 2(a)(11) of the Securities Act. Lincoln Park has informed us that each such broker-dealer will receiveAct, and any commissions from Lincoln Park that will not exceed customary brokerage commissions.
Brokers, dealers, underwriters or agents participating inreceived by it and any profit realized on the distributionresale of the shares of our common stock offeredsecurities sold by this prospectus may receive compensation in the form of commissions,it while acting as principal might be deemed to be underwriting discounts or concessions from the purchasers, for whom the broker-dealers may act as agent, of shares of our common stock sold by Lincoln Park through this prospectus. The compensation paid to any such particular broker-dealer by any such purchasers of shares of our common stock sold by Lincoln Park may be less than or in excess of customary commissions. Neither we nor Lincoln Park can presently estimate the amount of compensation that any agent will receive from any purchasers of shares of our common stock sold by Lincoln Park.
We know of no existing arrangements between Lincoln Park or any other stockholder, broker, dealer, underwriter or agent relating to the sale or distribution of the shares of our common stock offered by this prospectus.
We may from time to time file with the SEC one or more supplements to this prospectus or amendments to the registration statement that includes this prospectus to amend, supplement or update information contained in this
prospectus, including, if and when requiredcommissions under the Securities Act, to disclose certain information relating to a particular sale of shares of our common stock offered by this prospectus by the selling stockholder, including the names of any brokers, dealers, underwriters or agents participating in the distribution of such shares of our common stock by the selling stockholder, any compensation paid by Lincoln Park to any such brokers, dealers, underwriters or agents, and any other required information.
We will pay the expenses incident to the registration under the Securities Act of the offer and sale of the shares of our common stock included in this prospectus by Lincoln Park. We have agreed to indemnify Lincoln Park and certain other persons against certain liabilities in connection with the offering of shares of our common stock offered by this prospectus, including liabilities arising under the Securities Act or, if such indemnity is unavailable, to contribute amounts required toAct. As an underwriter, each placement agent would be paid in respect of such liabilities. Lincoln Park has agreed to indemnify us against liabilities under the Securities Act that may arise from certain written information furnished to us by Lincoln Park specifically for use in this prospectus or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities.
Lincoln Park has represented to us that at no time prior to the Purchase Agreement has Lincoln Park or its agents, representatives or affiliates engaged in or effected, in any manner whatsoever, directly or indirectly, any short sale (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of our common stock or any hedging transaction, which establishes a net short position with respect to our common stock. Lincoln Park agreed that during the term of the Purchase Agreement, it, its agents, representatives or affiliates will not enter into or effect, directly or indirectly, any of the foregoing transactions.
We have advised Lincoln Park that it is required to comply with the requirements of the Securities Act and the Exchange Act, including, without limitation, Rule 10b-5 and Regulation M promulgated under the Exchange Act. With certain exceptions, Regulation M precludesThese rules and regulations may limit the selling stockholder,timing of purchases and sales of our securities by the placement agent acting as principal. Under these rules and regulations, the placement agent (i) may not engage in any affiliated purchasers,stabilization activity in connection with our securities and any broker-dealer or other person who participates in the distribution from bidding(ii) may not bid for or purchasing,purchase any of our securities or attemptingattempt to induce any person to bid for or purchase any security which isof our securities, other than as permitted under the subjectExchange Act, until it has completed its participation in the distribution.
This offering will terminate on the earlier of (i) termination of the Purchase Agreement or (ii) the dateprospectus in any jurisdiction where action for that all shares of our common stockpurpose is required. The securities offered by this prospectus have been sold by Lincoln Park.
Our common stock is listed on The Nasdaq Capital Market under the symbol “HSDT” and on the Toronto Stock Exchange “TSX” under the symbol “HSM”. However, we have applied to voluntarily delist our common stock from the TSX effective September 9, 2021.
No Sales to Canadian Residents
The shares of our Class A Common Stock offered under this prospectus may not be resoldoffered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
Loeb & Loeb LLP, New York, New York is acting as counsel to the Placement Agent.
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You also may access these filings on our website at http://www.heliusmedical.com. We do not incorporate the information on our website into this prospectus and you should not consider any information on, or that can be accessed through, our website as part of this prospectus (other than those filings with the SEC that we specifically incorporate by reference into this prospectus).
731,958 Shares
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Amount | ||||
SEC registration fee | $ | 1,143.55 | ||
Accounting fees and expenses | $ | 25,000 | ||
Legal fees and expenses | $ | 75,000 | ||
Transfer agent fees and expenses | $ | 15,000 | ||
Miscellaneous fees and expenses | $ | 8,856.05 | ||
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Total | $ | 125,000 | ||
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SEC registration fee | | | | $ | 4,797.00 | | |
FINRA filing fee | | | | $ | 5,375.00 | | |
Printing expenses | | | | $ | 50,000.00 | | |
Accounting fees and expenses | | | | $ | 65,000.00 | | |
Legal fees and expenses | | | | $ | 200,000.00 | | |
Transfer agent fees and expenses | | | | $ | 2,000.00 | | |
Miscellaneous fees and expenses | | | | $ | 2,828.00 | | |
Total | | | | $ | 330,000.00 | | |
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We have entered into indemnification agreements with our directors and officers. These agreements provide broader indemnity rights than those provided under the Delaware General Corporation Law and our Certificate of Incorporation. The indemnification agreements are not intended to deny or otherwise limit
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On October 21, 2020, As of December 31, 2023, we entered into a securities purchase agreement with certain purchasers, pursuanthave sold 8,627 shares to which we agreed to sell and issue, in a private placement, an aggregate of 187,646 shares of common stock. Pursuant toLincoln Park under the Lincoln Park Purchase Agreement, we also issued 93,817 Warrants. The Warrants have an initial exercise price of $15.82 per share and expire on October 26, 2023, except that Warrants issued to insiders, and affiliates of insiders, have an initial exercise price of $16.1665 per share and expire on October 26, 2023. Joseph Gunnar & Co., LLC acted as placement agent for the Company in connection with the private placement. The Company issued warrants to the Joseph Gunnar & Co., LLC to purchase 961 shares of common stock, with an exercise price of $19.775 per share.
On March 18, 2020, we entered into a securities purchase agreement with certain purchasers, pursuant to which we agreed to sell and issue to such purchasers, in a registered direct offering, an aggregate of 178,776 shares of our common stock, at $12.25 per share. Pursuant to the purchase agreement, in a concurrent private placement, on March 20, 2020 we issued to the purchasers warrants to purchase up to 178,776 shares of common stock. The warrants are exercisable beginning on September 21, 2020 at an exercise price of $16.10 per share and expire on September 22, 2025. H.C. Wainwright & Co., LLC acted as placement agent for the private placement.
In March 2018, we issued 15,874 shares of common stock upon the exercise of warrants at an exercise price of $236.25 per share. During the second quarter of 2018, we issued 405 shares of common stock upon the exercise of warrants at an exercise price of CAD$262.50 per share. The issuance of these securities was exempt from registration pursuant to Regulation S of the Securities Act as an offering outside the United States. During the third quarter of 2018, we issued 1 share of common stock upon the exercise of warrants at an exercise price of CAD$262.50 per share. The issuance of these securities was exempt from registration pursuant to Regulation S of the Securities Act as an offering outside the United States.
Agreement.
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Rule 701 promulgated under the Securities Act, in that they were offered and sold either pursuant to written compensatory plans or pursuant to a written contract relating to compensation, as provided by Rule 701, or under Rule 506 of Regulation D promulgated under the Securities Act.
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Schedules Exhibits.Schedules.Item 17.Undertakings.(a)The undersigned Registrant hereby undertakes:(1)To file, during any period in which offers or sales are being made, a post-effective amendment to the registration statement:(i)To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended (the “Securities Act”);(ii)To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and(iii)To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
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EXHIBIT INDEX
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September 3, 2021.April 26, 2024.Helius Medical Technologies, Inc.By:/s/ Dane C. AndreeffDane C. AndreeffPresident, Chief Executive Officer and DirectorKNOW ALL MEN BY THESE PRESENTS, that the undersigned officers and directors of Helius Medical Technologies, Inc., a Delaware corporation, do hereby constitute and appoint each of
President, Chief Executive Officer and Jeffrey S. Mathiesen as his or her true and lawful attorney-in-factDirector and agent, with full power of substitution and re-substitution, for him and in his name, place, and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments, exhibits thereto and other documents in connection therewith) to this Registration Statement and any subsequent registration statement filed by the registrant pursuant to Rule 462(b) of the Securities Act of 1933, as amended, which relates to this Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof Signature Title Date SignatureTitleDate President, Chief Executive Officer (Principal September 3, 2021Dane C. Andreeff
Executive Officer) and Director April 26, 2024 Chief Financial Officer (Principal Financial September 3, 2021Jeffrey S. MathiesenOfficer and Principal Accounting Officer) and Director April 26, 2024 /s/ Director September 3, 2021April 26, 2024 Edward M. Straw/s/ Director September 3, 2021April 26, 2024 Sherrie Perkins /s/ Mitchell E. Tyler Director September 3, 2021April 26, 2024 Mitchell E. Tyler/s/ Director September 3, 2021Blane WalterApril 26, 2024
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| *By: | | | /s/ Dane C. Andreeff Attorney-in-fact | | | | | | | |