Item 1.01
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Entry into a Material Definitive Agreement.
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On February 12,
2020, Hepion Pharmaceuticals, Inc. (the “Company”), entered into an At Market Issuance Sales Agreement (the “Sales
Agreement”) with B. Riley FBR, Inc., as agent (“B. Riley FBR”), pursuant to which the Company may offer and sell,
from time to time, through B. Riley FBR, shares of the Company’s common stock, par value $0.0001 per share (the “Common
Stock”), having an aggregate offering price of up to $7,000,000 (the “Shares”).
The offer and
sale of the Shares will be made pursuant to a shelf registration statement on Form S-3 and the related prospectus
(File No. 333-229534) filed by the Company with the Securities and Exchange Commission (the “SEC”) on February
6, 2019, as amended on February 13, 2019, and declared effective by the SEC on February 19, 2019, as supplemented by a prospectus
supplement dated February 12, 2020 and filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933, as
amended (the “Securities Act”).
Pursuant to the
Sales Agreement, B. Riley FBR may sell the Shares by any method permitted by law deemed to be an “at the market offering”
as defined in Rule 415 of the Securities Act, including sales made by means of ordinary brokers’ transactions, including
on The Nasdaq Capital Market, at market prices or as otherwise agreed with B. Riley FBR. B. Riley FBR will use commercially reasonable
efforts consistent with its normal trading and sales practices to sell the Shares from time to time, based upon instructions from
the Company, including any price or size limits or other customary parameters or conditions the Company may impose.
The Company is
not obligated to make any sales of the Shares under the Sales Agreement. The offering of Shares pursuant to the Sales Agreement
will terminate upon the earliest of (a) the sale of all of the Shares subject to the Sales Agreement or (b) the termination
of the Sales Agreement by B. Riley FBR or the Company, as permitted therein.
The Company
will pay B. Riley FBR a commission rate equal to an aggregate of up to 3.0% of the aggregate gross proceeds from each sale of
Shares and have agreed to provide B. Riley FBR with customary indemnification and contribution rights. The Company will also
reimburse B. Riley FBR for certain specified expenses in connection with entering into the Sales Agreement. The Sales
Agreement contains customary representations and warranties and conditions to the placements of the Shares pursuant
thereto.
The foregoing
description of the Sales Agreement is not complete and is qualified in its entirety by reference to the full text of such agreement,
a copy of which is filed herewith as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated
herein by reference.
The legal opinion,
including the related consent of Sheppard, Mullin, Richter & Hampton LLP relating to the issuance and sale of the Shares, is
filed as Exhibit 5.1 hereto.
This Current Report
on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy the Common Stock discussed
herein, nor shall there be any offer, solicitation, or sale of common stock in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities laws of any such state.