|SEELOS THERAPEUTICS, INC. filed this Form S-3 on 02/01/2019|
- the provision for redemption, if applicable, of the class or series of preferred stock;
- the terms and conditions, if applicable, upon which the class or series of preferred stock will be convertible into common stock, including the conversion price or
manner of calculation and conversion period;
- voting rights, if any, of the class or series of preferred stock;
- the relative ranking and preferences of the class or series of preferred stock as to dividend rights and rights, if any, upon the liquidation, dissolution or winding up of
- any limitations on issuance of any class or series of preferred stock ranking senior to or on a parity with the class or series of preferred stock as to dividend rights
and rights, if any, upon liquidation, dissolution or winding up of our affairs; and
- any other specific terms, preferences, rights, limitations or restrictions of the class or series of preferred stock.
As of January 31, 2019, in addition to the Warrants we are registering hereunder, warrants to purchase an aggregate of approximately 436,503 of our Common Shares with a weighted-average
exercise price of approximately $20.62 per share were outstanding. We are registering the resale of the Common Shares issuable upon exercise of the Warrants pursuant to the registration statement of
which this prospectus forms a part.
The Series A Warrants have an initial exercise price of $4.15, were immediately exercisable upon issuance and have a term of five years from the date of issuance. The Series A Warrants
provide that, for the first three years following the issuance of the Series A Warrants, if we issue or sell, or are deemed to have issued or sold, any Common Shares for a price per share lower
than the exercise price then in effect, subject to certain limited exceptions, then the exercise price of the Series A Warrants shall be reduced to such lower price per share. If we issue or sell, or
are deemed to have issued or sold any Common Shares for a price per share lower than the exercise price then in effect after the first three years following the issuance of the Series A
Warrants, subject to certain limited exceptions, then the exercise price of the Series A Warrants shall be reduced to an amount equal to the product of (i) the exercise price then in effect and (ii)
the quotient determined by dividing (a) the sum of (x) the product derived by multiplying the exercise price then in effect and the number of Common Shares outstanding immediately prior to the
new issuance plus (y) the consideration received by us for the new issuance, by (b) the product derived by multiplying (x) the exercise price then in effect by (y) the number of Common Shares
outstanding immediately after the new issuance. In addition, the exercise price and the number of Common Shares issuable upon exercise of the Series A Warrants will also be subject to
adjustment in connection with stock splits, dividends or distributions or other similar transactions.
Additionally, on each Reset Date following (i) each date on which a registration statement registering any Warrant Shares is declared effective or is available for use, (ii) if there is no
registration statement registering all of the Warrant Shares, the Six Month Reset Date and (iii) in the event of a Public Information Failure at any time following the Six Month Reset Date, then
the earlier to occur of (1) the date the Public Information Failure is cured and no longer prevents the holder from selling all of the Warrant Shares pursuant to Rule 144 without restriction or
limitation, (2) the first date on which the holders can sell all the Warrant Shares without restriction or limitation pursuant to Rule 144 under the Securities Act and without the requirement to be in
compliance with Rule 144(c)(1), and (3) January 24, 2020, the exercise price will be adjusted to be the lesser of (i) the exercise price then in effect and (ii) 125% of 80% of the average of the
five lowest volume-weighted average trading prices of a Common Share as quoted on Nasdaq during the applicable Reset Period to date and the number of Common Shares issuable upon
exercise of the Series A Warrants will be proportionally increased accordingly, provided that we shall in no event issue Common Shares pursuant to the exercise of the Warrants, in the
aggregate, in excess of the Warrant Issuance Cap. In the event that we are unable to issue Common Shares pursuant to an exercise of Warrants due to the application of the Warrant Issuance
Cap, we will pay to the exercising holder an amount in cash per share equal to the difference between the last closing trade price of Common Shares and the applicable exercise price, to the
extent not previously paid to us.
Pursuant to the Series A Warrants, we will agree not to enter into, allow or be party to certain fundamental transactions, generally including any merger with or into another entity, sale of all
or substantially all of our assets, tender offer or exchange offer, or reclassification of Common Shares (a "Fundamental Transaction") until the Reservation Date. Thereafter, we will
agree not to enter into or be party to a Fundamental Transaction unless the successor entity in such transaction assumes in writing all of our obligations under the Series A Warrants, upon
which the Series A Warrants shall become exercisable for Common Shares, shares of the common stock of the successor entity or the consideration that would have been issuable to the
holders had they exercised the Series A Warrants prior to such Fundamental Transaction, at the holders' election. Additionally, if the successor entity is a publicly traded corporation, the
holders may elect to receive an equivalent security of the successor entity, in exchange for the Series A Warrants. Any security issuable or potentially issuable to the holder pursuant to the
terms of the Series A Warrants on the consummation of a Fundamental Transaction must be registered and freely tradable by the holder without any restriction or limitation or the requirement
to be subject to any holding period pursuant to any applicable securities laws.
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