| Item 1.01. | Entry into a Material Definitive Agreement. |
On March 27, 2024, Stoke Therapeutics, Inc., a Delaware corporation (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC as representative of the underwriters named therein (the “Underwriter”), pursuant to which the Company agreed to issue and sell 5,555,557 shares (the “Underwritten Shares”) of its common stock, par value $0.0001 per share (“Common Stock”) to the Underwriter in a public offering at a price of $13.50 per Underwritten Share, and, in lieu of Common Stock to certain investors, pre-funded warrants (the “Pre-Funded Warrants”) to purchase 3,703,730 shares of Common Stock at a public offering price of $13.4999 per Pre-Funded Warrant, which represents the price per share at which shares of Common Stock are being sold to the public in this offering, minus $0.0001, which is the exercise price of each Pre-Funded Warrant (the “Offering”). Pursuant to the Underwriting Agreement, the Company has also granted the Underwriters a 30-day option to purchase up to an additional 1,388,893 shares of its Common Stock (the “Option Shares,” and together with the Underwritten Shares, the “Shares”).
The Underwriting Agreement contains customary representations and warranties, conditions to closing, market standoff provisions, termination provisions and indemnification obligations, including for liabilities under the Securities Act of 1933, as amended. The Offering is being made pursuant to the shelf registration statement on Form S-3 (File No. 333-265107) that was filed by the Company with the Securities and Exchange Commission (“SEC”) on May 20, 2022, and declared effective by the SEC on May 31, 2022, and a related prospectus supplement and free-writing prospectus.
The Company estimates that net proceeds from the Offering will be approximately $119.8 million, after deducting underwriting discounts and commissions and estimated Offering expenses, and assuming no exercise of the Underwriters’ option to purchase additional shares. The Company may receive nominal proceeds, if any, from the exercise of the Pre-Funded Warrants. The Company intends to use the net proceeds of the Offering, together with our existing cash and cash equivalents, to fund research, clinical and process development and manufacturing of our product candidates, including late stage development of STK-001 and further development of STK-002, developing additional product candidates, working capital, capital expenditures and other general corporate purposes. The Company expects the Offering to close on April 2, 2024, subject to the satisfaction of customary closing conditions.
The Underwriting Agreement is filed as Exhibit 1.1 to this report, and the foregoing description of the terms of the Underwriting Agreement is qualified in its entirety by reference to such exhibit. The form of Pre-Funded Warrant is filed as Exhibit 4.1 to this report, and the forgoing description of the terms of the Pre-Funded Warrants is qualified in its entirety by reference to such exhibit. A copy of the opinion of Fenwick & West LLP, relating to the validity of the Shares in connection with the Offering, is filed with this Current Report on Form 8-K as Exhibit 5.1.
