Item 1.01 Entry into a Material Definitive Agreement
Subscription Agreement
On September 6, 2016, Anthera
Pharmaceuticals, Inc. (the Company) entered into a subscription agreement (the Subscription Agreement) with purchasers affiliated with Biotechnology Value Fund, L.P. (BVF) and Rock Springs Capital Master Fund
LP ( Rock Springs, and together with BVF, the Purchasers). Pursuant to the Subscription Agreement, the Company agreed to issue shares of its Series X Convertible Preferred Stock (the Series X Preferred
Stock), warrants to purchase common stock (the Warrants) and shares of its Series X-1 Convertible Preferred Stock (the Series X-1 Preferred Stock) as follows:
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The first tranche consists of 17,000 Series X Units, with each unit consisting of one share of Series X Preferred Stock and a Warrant to purchase 70.62 shares of common stock, assuming the Series X Conversion Price is
$2.95, the closing price of our common stock on September 6, 2016, offered directly to the Purchasers and expected to close on or about September 12, 2016, at a price per unit of $1,000.
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The second tranche consists of 28,330 of shares of Series X-1 Preferred Stock that may be purchased at the option of the Purchasers within 20 trading days following the Companys initial public announcement of
top-line data from the Companys ongoing SOLUTION study (Phase 3 study evaluating the efficacy and safety of Liprotamase in subjects with cystic fibrosis-related exocrine pancreatic insufficiency), at a price per share of $1,000.
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Series X Preferred Stock and Series X-1 Preferred Stock
The conversion price for the Series X Preferred Stock (the Series X Conversion Price) will be equal to the lower of: (a) $2.95, the closing price
for the Common Stock as reported on NASDAQ on September 6, 2016, or (b) the five-day volume-weighted average price (VWAP) of the Companys common stock over the five full trading days following the earlier of (1) the date of the
Companys initial public announcement of topline and/or efficacy data from the ongoing Chablis-SC1 study or (2) if applicable, the date of the Companys initial public announcement of the suspension (including through the imposition of a
clinical hold), abandonment or other termination of the Chablis-SC1 study.
The conversion price for the Series X-1 Preferred Stock will be equal to the
lower of: (a) 75% of the five-day VWAP of the Companys Common Stock over the five full trading days following the Companys initial public announcement of top-line clinical efficacy and safety data from the Corporations ongoing
SOLUTION clinical study (Phase 3 study evaluating the efficacy and safety of Liprotamase in subjects with cystic fibrosis-related exocrine pancreatic insufficiency), or (b) 175% of the then-applicable conversion price for the Series X
Preferred Stock, provided that the conversion price will in no event be lower than $2.95, the closing price for the Common Stock as reported on NASDAQ on September 6, 2016.
The Purchasers, however, will be prohibited from converting Series X Preferred Stock and Series X-1 Preferred Stock into shares of the Companys Common
Stock if, as a result of such conversion, such Purchaser, together with its affiliates, would own more than 9.99% of the shares of the Companys common stock then issued and outstanding, which percentage may change at the Purchasers
election to any other number less than or equal to 19.99% upon 61 days notice to the Company.
In the event of the Companys liquidation,
dissolution or winding up, holders of Series X Preferred Stock and Series X-1 Preferred Stock will receive any dividends declared but unpaid on such shares, before any proceeds are distributed to the holders of the Companys common stock, and
will
participate
pari passu
with any distribution of proceeds to holders of the Companys common stock. Shares of Series X Preferred Stock and Series X-1 Preferred Stock will generally
have no voting rights.
Warrants
Each Warrant has an
exercise price equal to the Series X Conversion Price, plus a 20% premium, and will be exercisable at any time and from time to time after the date that is six months from the date of issuance, and will expire thirty months from the first date it
first becomes exercisable.
This registered direct offering is being made pursuant to the Companys shelf registration statement on Form S-3
(Registration No. 333-210166), filed with the Securities and Exchange Commission (the SEC) on March 14, 2016, which was declared effective by the SEC on April 18, 2016 (the Registration Statement).
A copy of the form of Subscription Agreement is attached hereto as Exhibit 10.1 and is incorporated herein by reference. A copy of the Certificate of
Designation of Preferences, Rights and Limitations of Series X Convertible Preferred Stock and a copy of the form of the Certificate of Designation of Preferences, Rights and Limitations of Series X-1 Convertible Preferred Stock are attached hereto
as Exhibits 3.1 and 3.2, respectively, and are incorporated by reference herein. A copy of the form of Warrant and the specimen Series X Convertible Preferred Stock certificate are attached hereto as Exhibits 4.1 and 4.2, respectively, and are
incorporated by reference herein. The foregoing descriptions of the terms of the Subscription Agreement and the rights, preferences and privileges of the Series X Preferred Stock, Series X-1 Preferred Stock and Warrants do not purport to be
complete and are qualified in their entirety by reference to such exhibits. A copy of the opinion of Goodwin Procter LLP relating to the legality of the issuance and sale of the securities in this offering is attached as Exhibit 5.1 hereto. This
opinion is also filed with reference to, and is hereby incorporated by reference into, the Registration Statement.