Item 1.01. Entry into a Material Definitive
Agreement
On January 7, 2021, Onconova Therapeutics, Inc.
(the “Company”) entered into a purchase agreement (the “Purchase Agreement”) with certain institutional
and accredited investors (collectively, the “Investors”) for the sale by the Company directly to the Investors of an
aggregate of 19,551,124 shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”),
at a purchase price of $0.445 per share (the “Registered Direct Offering”). The Registered Direct Offering is
expected to close on January 11, 2021, subject to customary closing conditions set forth in the Purchase Agreement. The Company
intends to use the net proceeds of the Registered Direct Offering for working capital and general corporate purposes. The Company
estimates that the net proceeds from the transactions will be approximately $8.5 million after deducting estimated transaction
expenses.
The 19,551,124 shares of Common Stock sold
in the Registered Direct Offering were offered and sold by the Company directly to the Investors, without a placement agent, underwriter,
broker or dealer, pursuant to an effective shelf registration statement on Form S-3 (File No. 333-237844) declared effective
by the Securities and Exchange Commission (the “SEC”) on May 18, 2020, and the base prospectus contained therein. Prior
to closing, the Company will file a prospectus supplement with the SEC relating to the offer and sale of the shares of Common Stock
in the Registered Direct Offering.
Under the Purchase Agreement, subject to
certain exceptions, the Company is subject to lock-up restrictions on the issuance and sale of our securities for 60 days following
the closing of the Registered Direct Offering. Additionally, under the Purchase Agreement, subject to certain exceptions, the Company
is prohibited from effecting or entering into an agreement to effect any “variable rate transactions” as defined in
the Purchase Agreement for a period of five years following the closing of the Registered Direct Offering.
In addition, each Investor has agreed that
such Investor will not, during the period commencing on the date of the Purchase Agreement and ending on the earlier of (i) the
calendar day immediately following the date established by the Company’s board of directors as the record date for the Company’s
special meeting of stockholders to be held on March 4, 2021 and (ii) January 21, 2021, offer, pledge, sell, contract to sell, grant,
lend, or otherwise transfer or dispose of, directly or indirectly, any of the shares such investor purchased in the Registered
Direct Offering. Each Investor has also agreed to vote all of the shares of the Common Stock beneficially owned by such Investor
and its affiliates and entitled to vote at the special meeting of stockholders to be held on March 4, 2021 in favor of each Company
proposal that is submitted by the Company to its stockholders for a vote at the special meeting.
In connection with the Registered Direct
Offering, we have agreed to pay Lincoln Park Capital Fund, LLC, as the lead investor, an aggregate of $100,000 as the full and
complete expense reimbursement of Lincoln Park’s expenses in connection with the Registered Direct Offering, including any
due diligence expenses and legal fees. Furthermore, under the Purchase Agreement, we have granted Lincoln Park certain rights
to participate in up to 50% of the amount of any future offerings of Common Stock or securities exercisable for or convertible
into Common Stock that the Company seeks to complete within one year after the closing of the Registered Direct Offering, other
than a firm commitment public offering.
The representations, warranties and covenants
contained in the Purchase Agreement were made solely for the benefit of the Company and the Investors. In addition, such representations,
warranties and covenants (i) are intended as a way of allocating the risk between the Company and the Investors 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. Moreover, 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.
The foregoing description of the Purchase
Agreement is not complete and is qualified in its entirety by references to the full text of the Purchase Agreement, the form of
which is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference herein.
A copy of the opinion of Morgan, Lewis
& Bockius LLP relating to the validity of the shares of Common Stock issued in the Registered Direct Offering is filed herewith
as Exhibit 5.1 to this Current Report on Form 8-K.