| Item 1.01 | Entry into a Material Definitive Agreement. |
On October 5, 2023, Equillium, Inc. (the “Company”) entered into an Open Market Sale AgreementSM (the “Sale Agreement”) with Jefferies LLC (“Jefferies”), pursuant to which the Company may, from time to time, offer and sell shares of the Company’s common stock, par value $0.0001 per share (the “Shares”), through Jefferies, as the Company’s sales agent and/or principal.
The Shares will be offered and sold pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-269153) (the “Registration Statement”), which was originally filed with the Securities and Exchange Commission (“SEC”) on January 6, 2023, the base prospectus contained within the Registration Statement, and a prospectus supplement that was filed with the SEC on October 5, 2023 in connection with the offer and sale of the Shares pursuant to the Sale Agreement. The Shares may only be offered and sold by means of a prospectus, including a prospectus supplement, forming part of the effective Registration Statement.
The Company is not obligated to make any sales under the Sale Agreement and may at any time suspend sale of the Shares under the Sale Agreement. Any sales of Shares will be made by methods deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including privately negotiated transactions with the consent of the Company, block transactions, sales made directly on the Nasdaq Capital Market or sales made into any other existing trading market for the Company’s common stock. The Company intends to use the net proceeds of the offering to fund the continued development of any product candidates in the Company’s pipeline, and for working capital, capital expenditures and general corporate purposes.
Jefferies will act as sales agent and/or principal and will use commercially reasonable efforts consistent with its normal trading and sales practices to place all of the Shares requested to be sold by the Company. The Company will pay Jefferies a commission rate of 3.0% of the gross proceeds from the sales of Shares sold pursuant to the Sale Agreement. In addition, the Company has agreed to pay certain expenses incurred by Jefferies in connection with the offering. The Company has also provided Jefferies with customary representations, warranties, covenants, and indemnification rights. Both parties have the right to terminate the Sale Agreement upon written notice to the other party as specified in the Sale Agreement.
The foregoing description of the Sale Agreement does not purport to be complete and is qualified in its entirety by reference to the full Sale Agreement, a copy of which is attached hereto as Exhibit 1.1 and is incorporated herein by reference.
The legal opinion of Cooley LLP relating to the Shares being offered pursuant to the Sale Agreement is filed as Exhibit 5.1 to this Current Report on Form 8-K.
This Current Report on Form 8-K does not constitute an offer to sell the Shares or a solicitation of an offer to buy the Shares, nor shall there be any sale of the Shares in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
| Item 1.02 | Termination of a Material Definitive Agreement. |
On October 5, 2023, the Company and Jefferies terminated that certain Open Market Sale AgreementSM (the “Prior Agreement”) that the Company entered into with Jefferies on July 14, 2020. Under the Prior Agreement, the Company was permitted to offer and sell, from time to time, shares of the Company’s common stock having an aggregate offering price of up to $150,000,000 through Jefferies by methods deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act. The Company sold $10.4 million of shares of its common stock under the Prior Agreement.
