| Item 1.01 | Entry into a Material Definitive Agreement. |
On August 10, 2022, Athenex, Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with SVB Securities, LLC, (the “Underwriter”), in connection with the offer and sale of 35,333,334 shares of the Company’s common stock, par value $0.001 per share (the “common stock”), warrants to purchase up to 40,000,000 shares of common stock at a price of $1.00 per share (the “common warrants”) and, pre-funded warrants to purchase up to 4,666,666 shares of common stock at a price of $0.001 per share (the “pre-funded warrants,” and together with the common warrants, the “warrants”) pursuant to a registration statement on Form S-3 (File No. 333-258185) that was filed with the Securities and Exchange Commission (the “SEC”) on July 27, 2021 and became effective on August 12, 2021, and the prospectus contained therein, as supplemented by the prospectus supplement dated August 10, 2022 (the “Prospectus Supplement”), in an underwritten public offering at a public offering price of $0.75 for each share of common stock and accompanying common warrant and $0.749 for each pre-funded warrant and accompanying common warrant (the “Offering”). The warrants are immediately exercisable and will expire five years from the date of issuance. The warrants are subject to adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Common Stock and also are entitled to participate on an as-exercised basis with respect to the Company’s stockholders. In the event of a fundamental transaction, the holders of the warrants are entitled to receive from the Company, or any successor entity, the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of the warrants, that is being offered and paid to the holders of common stock of the Company in connection with the fundamental transaction. The warrants do not entitle the holders thereof to any voting rights or any of the other rights or privileges to which holders of Common Stock are entitled.
The net proceeds to the Company from the Offering is expected to be approximately $27.6 million, after deducting underwriting discounts and commissions and estimated offering expenses. The Company intends to use the net proceeds from this Offering to fund ongoing clinical development of its product candidates and for working capital and other general corporate purposes. The Offering is expected to close on or about August 15, 2022, subject to the satisfaction of customary closing conditions.
Pursuant to the Underwriting Agreement, the Company and its officers and directors have agreed not to offer, sell, transfer or otherwise dispose of any shares of the Company’s common stock during the 60- and 90-day period, respectively, following the date of the final prospectus used for the Offering.
The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters against certain liabilities, including for liabilities under the Securities Act of 1933, as amended, and termination provisions. The provisions of the Underwriting Agreement, including the representations and warranties contained therein, are not for the benefit of any party other than the parties to such agreement and are not intended as a document for investors and the public to obtain factual information about the current state of affairs of the Company. Rather, investors and the public should look to other disclosures contained in the Company’s filings with the SEC.
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