| Item 1.01 | Entry into a Material Definitive Agreement. |
On July 12, 2022, Histogen Inc. (“Histogen” or the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) with a single healthcare-focused institutional investor (the “Investor”) for the sale by the Company of (i) a pre-funded warrant to purchase up to an aggregate 1,774,309 shares of common stock (the “Pre-Funded Warrant”), (ii) a Series A warrant to purchase up to an aggregate of 1,774,309 shares of common stock (the “Series A Warrant”), and (iii) a Series B warrant to purchase up to an aggregate of 1,774,309 shares of common stock (the “Series B Warrant,” and together with the Pre-Funded Warrant and the Series A Warrant, the “Warrants”), in a private placement offering (the “Offering”). The combined purchase price of one Pre-Funded Warrant and accompanying Series A Warrant and accompanying Series B Warrant is $2.818.
Subject to certain ownership limitations, the Series A Warrant will become exercisable immediately after the issuance date at an exercise price equal to $2.568 per share of common stock, subject to adjustments as provided under the terms of the Series A Warrant, and has a term of five and one half years from the issuance date. Subject to certain ownership limitations, the Series B Warrant will become exercisable immediately after the issuance date at an exercise price equal to $2.568 per share of common stock, subject to adjustments as provided under the terms of the Series B Warrant, and has a term of eighteen months from the issuance date. Subject to certain ownership limitations described in the Pre-Funded Warrant, the Pre-Funded Warrant is immediately exercisable and may be exercised at an exercise price of $0.0001 per share of common stock any time until all of the Pre-Funded Warrant is exercised in full.
The closing of the sale of the Warrants under the Purchase Agreement is expected to occur on or about July 14, 2022, subject to the satisfaction of customary closing conditions.
The gross proceeds to the Company from the Offering are expected to be approximately $5 million, before deducting the placement agent’s fees and other offering expenses, and excluding the proceeds, if any, from the exercise of the Series A Warrant and the Series B Warrant. The Company intends to use the net proceeds from the Offering for working capital and general corporate purposes.
In connection with the Purchase Agreement, Histogen entered in a Registration Rights Agreement with the Investor and agreed to file within fifteen days a resale registration statement (the “Resale Registration Statement”) with the Securities and Exchange Commission (the “Commission”) covering all shares of common stock issuable upon exercise of the Warrants, and to cause the Resale Registration Statement to become effective within seventy-five days assuming “full review” of the Resale Registration Statement by the Commission.
The Warrants and the shares issuable upon exercise of the Warrants are being sold and issued without registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and Rule 506 of Regulation D promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions under applicable state laws.
The representations, warranties and covenants contained in the Purchase Agreement were made solely for the benefit of the parties to the Purchase Agreement. In addition, such representations, warranties and covenants: (i) are intended as a way of allocating the risk between the parties to the Purchase Agreement and not as statements of fact, and (ii) may apply standards of materiality in a way that is different from what may be viewed as material by stockholders of, or other investors in, the Company. Accordingly, the Purchase Agreement is filed with this report only to provide investors with information regarding the terms of transaction, and not to provide investors with any other factual information regarding the Company. Information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in public disclosures.
In connection with the Purchase Agreement, the Company also entered into a warrant amendment agreement (the “Warrant Amendment”) with the Investor, in consideration for the Investor’s participation in the Offering and purchase of Warrants in the Offering and the payment of $0.0316 per share for each share of common stock
