| Item 1.01 | Entry into a Material Definitive Agreement. |
Securities Purchase Agreements
On February 5, 2024, Adverum Biotechnologies, Inc., a Delaware corporation (the “Company”), entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain institutional and accredited investors (the “Investors”), pursuant to which the Company agreed to issue and sell to the Investors in a private placement (the “Private Placement”) an aggregate of 105,500,057 shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share, and to certain investors, in lieu of Shares, pre-funded warrants (the “Pre-Funded Warrants”) to purchase an aggregate of 750,000 shares of common stock. The purchase price per Share is $1.20 (or $1.1999 per Pre-Funded Warrant, which represents the purchase price per Share to be sold in the Private Placement, minus the $0.0001 per share exercise price of each such Pre-Funded Warrant). The Pre-Funded Warrants are exercisable at any time after their original issuance and will not expire until exercised in full.
The Pre-Funded Warrants to be issued in the Private Placement will provide that a holder of Pre-Funded Warrants will not have the right to exercise any portion of its Pre-Funded Warrants if such holder, together with its affiliates, would beneficially own in excess of 4.99%, 9.99% or 19.99%, as applicable, of the number of shares of the Company’s common stock outstanding immediately after giving effect to such exercise (the “Beneficial Ownership Limitation”). A holder may reset the Beneficial Ownership Limitation as to itself to a higher percentage (not to exceed 19.99%), effective 61 days after written notice to the Company.
Existing investors that previously held five percent or more of the Company’s outstanding common stock, including Commodore Capital LP, FMR LLC and Venrock Healthcare Capital Partners III, L.P., and/or their affiliates are party to the Securities Purchase Agreement, and have agreed to purchase approximately $7 million, $10 million and $12.5 million, respectively, in Shares in the Private Placement.
Concurrently with the Private Placement, the Company also entered into a securities purchase agreement (the “Director Securities Purchase Agreement” and, together with the Securities Purchase Agreement, the “Securities Purchase Agreements”) with Mark Lupher, Ph.D., and James Scopa, directors of the Company (the “Directors”), pursuant to which the Company agreed to issue and sell in a private placement (the “Director Private Placement” and together with the “Private Placement,” the “Private Placements”) 230,000 shares (the “Director Shares” and together with the Shares, the “Private Placement Shares”) of common stock at a purchase price per share of common stock of $1.35, on otherwise substantially the same terms as those set forth in the Securities Purchase Agreement.
The Private Placements are expected to close on or about February 8, 2024, subject to the satisfaction of certain customary closing conditions. Following the closing of the Private Placements, there will be approximately 207,163,393 shares of the Company’s common stock outstanding. The Company expects to receive total gross proceeds from the Private Placements of $127.8 million, before deducting placement agent fees and offering expenses. The Company intends to use the net proceeds from the Private Placements to fund research and development of its clinical-stage product candidate and research programs and for working capital and general corporate purposes.
The foregoing descriptions of the Securities Purchase Agreements and the Pre-Funded Warrants do not purport to be complete and are qualified in their entirety by reference to the full text of the form of each such document, which are filed as Exhibits 10.1 and 4.1 hereto, respectively, and incorporated by reference herein.
Registration Rights Agreement
Also on February 5, 2024, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Investors and the Directors, pursuant to which the Company agreed to register for resale the Private Placement Shares and the issuance of the shares of common stock underlying the Pre-Funded Warrants held by the Investors (the “Registrable Securities”). Under the terms of the Registration Rights Agreement, the Company has agreed to prepare and file a registration statement with the Securities and Exchange Commission to register for resale the Registrable Securities. The Company has agreed to be responsible for all fees and expenses incurred in connection with the registration of the Registrable Securities.
