aibioAcurx Pharmaceuticals prices $2.5 million registered direct offering at $1.015 per share
Tickers ACXP
Acurx will sell 2,463,058 shares at $1.015 to institutional investors and six insiders, with Series E warrants for the same number of shares at $0.90. H.C. Wainwright & Co. is the exclusive placement agent, and it receives a 7.0% cash fee plus a 1.0% management fee.
Key facts
- Company
- Acurx Pharmaceuticals, Inc. (NASDAQ: ACXP)
- News type
- Financings
- Primary source
- Acurx Pharmaceuticals, Inc. Form 8-K filed January 7, 2025 (SEC EDGAR)
Acurx Pharmaceuticals, Inc. (Nasdaq: ACXP) agreed on January 6, 2025 to sell 2,463,058 shares of common stock in a registered direct offering at $1.015 per share. The company expects gross proceeds of approximately $2.5 million before placement agent fees and offering expenses. A concurrent private placement adds Series E warrants to buy the same number of shares at $0.90. The company disclosed the terms in a Form 8-K filed January 7, 2025. The offering is expected to close on or about January 7, 2025.
Who is buying
The buyers are institutional investors and six insiders. The insiders are David P. Luci, the president and chief executive officer; Robert J. DeLuccia, the executive chairman; and directors Carl V. Sailer, Jack H. Dean, James Donohue and Joseph Scodari. Together the insiders buy 167,488 shares, and the institutional investors buy 2,295,570. The 8-K describes the insiders as affiliate investors.
The sale is made under a securities purchase agreement dated January 6, 2025. The 8-K says the company intends to use the net proceeds for working capital and general corporate purposes.
Banks, advisors and counsel
H.C. Wainwright & Co., LLC is the exclusive placement agent. The company signed an engagement letter with Wainwright on October 9, 2024. Under that letter Wainwright gets a cash fee of 7.0% of gross proceeds from sales to institutional investors, plus a management fee of 1.0% of gross proceeds from the offering. Acurx also agreed to reimburse up to $35,000 of non-accountable expenses and up to $50,000 for Wainwright's legal counsel.
The 8-K also says Acurx will issue Wainwright or its designees warrants to buy up to 147,783 shares, exercisable immediately at $1.2688 a share and expiring five years after sales begin. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. gave the legal opinion on the shares, filed as Exhibit 5.1. The 8-K names no counsel for the investors.
The engagement letter also gives Wainwright a fee on any financing within twelve months after it ends if the investors were contacted or introduced by Wainwright. Wainwright also has a right of first refusal to act as sole book-running manager, underwriter or placement agent on offerings in the twelve months after the letter ends.
The warrants
The Series E warrants are exercisable immediately at $0.90 a share and expire five years from the initial exercise date. The holder may not exercise any portion that would leave it with more than 4.99% of Acurx's outstanding common stock, or 9.99% at the holder's option when the warrant is issued. A holder can raise its ownership cap to 9.99% after giving 61 days' notice.
The company agreed to use commercially reasonable efforts to have an S-1 resale registration statement declared effective within 60 calendar days after the purchase agreement, or 90 days if the Securities and Exchange Commission conducts a full review. It must keep that statement effective. The shares are sold under a Form S-3 shelf registration statement declared effective on July 11, 2022, while the warrants are issued unregistered under Section 4(a)(2) and Rule 506(b). The company also agreed not to issue common stock or equivalents for 30 days after closing and not to enter a variable rate transaction for one year.
The cash position and the going-concern warning
The 2023 annual report, filed March 15, 2024, says the company's independent registered public accounting firm expressed substantial doubt about its ability to continue as a going concern. Operating activities used $9.8 million in 2023, against a net loss of $14.6 million, and financing provided $8,163 thousand. The 8-K does not give a cash balance as of year-end 2024, and this raise brings in about $2.5 million gross. The warrant exercise price of $0.90 sits below the $1.015 offering price.
What comes next
Closing is expected on or about January 7, 2025. The resale registration statement is due 60 calendar days after the purchase agreement, or 90 days in a full review, and the warrants can be exercised once issued. The press release says ibezapolstat, the lead candidate for Clostridioides difficile infection, is Phase 3 ready, with plans in progress to begin international clinical trials this year. The 8-K does not describe further financing plans.