Alzamend Neuro, Inc. (Nasdaq: ALZN) (“Alzamend”), a
clinical-stage biopharmaceutical company focused on developing
novel products for the treatment of Alzheimer’s disease
(“Alzheimer’s”), bipolar disorder (“BD”), major
depressive disorder (“MDD”) and post-traumatic stress
disorder (“PTSD”), announced today that it has entered into
a Securities Purchase Agreement (the “Agreement”) with an
institutional investor (the “Investor”) for the purchase and
sale of 50 shares of its Series A Convertible Preferred Stock (the
“Preferred Shares”), stated value $10,000 per share in a
registered direct offering, for $500,000.
In addition, in a concurrent private placement, the Investor
agreed to purchase up to an additional 2,450 Preferred Shares, of
which 50 shares will be purchased at the initial closing and the
remaining Preferred Shares over a period of time as set forth in
the Agreement, for an aggregate purchase of up to $25 million of
Preferred Shares.
The Preferred Shares will be senior to all other classes of
preferred stock the Company has outstanding, as well as senior to
the Company’s common stock (“Common Stock”). Each Preferred
Share shall be convertible, subject to Nasdaq limitations until
such time as stockholder approval is obtained, at the holder’s
option into shares of Common Stock at a conversion price equal to
the greater of (i) $0.25 per share (the “Floor Price”) which
Floor Price shall, except for voting rights purposes, be adjusted
for stock dividends, stock splits, stock combinations and other
similar transactions, and (ii) the lesser of (A) $1.50 and (B) 80%
of the lowest closing price of the Common Stock during the three
trading days immediately prior to the date of conversion (the
“Conversion Price”). The Conversion Price will be subject to
standard anti-dilution provisions in connection with any stock
split, stock dividend, subdivision or similar reclassification of
the Common Stock. The Preferred Shares also has “full ratchet”
price protection in the event the Company should issue securities
at a lower price than the Conversion Price. The Preferred Shares
shall pay a dividend at an annual rate of 15%, which the Company
shall pay, at the Investor’s election, either in cash or Preferred
Shares.
Further, the Investor will receive unregistered warrants
(“Warrants”) to purchase up to 20 million shares of Common
Stock, presuming that the full amount of the Preferred Shares is
sold, be immediately exercisable for five years at $1.25 per share,
subject to adjustment.
The closing of the registered direct offering and the concurrent
private placement is expected to occur on or about May 10, 2024,
subject to the satisfaction of customary closing conditions and the
receipt of certain third party consents.
The proceeds from the Financing will be used to initiate
additional clinical trials by Alzamend for its two product
candidates and general working capital purposes.
Additional information regarding the securities described above
and the terms of the Financing will be included in a Current Report
on Form 8-K to be filed with the United States Securities and
Exchange Commission (“SEC”).
The Preferred Shares (and the shares of Common Stock issuable
upon conversion of the Preferred Shares) being offered in the
registered direct offering (but not the additional Preferred Shares
and Warrants being in the concurrent private placement or the
shares of Common Stock underlying the additional Preferred Shares
and Warrants) are being offered by Alzamend pursuant to a “shelf”
registration statement on Form S-3 (File No. 333-273610) previously
filed with the Securities and Exchange Commission (the “SEC”) on
August 2, 2023 and declared effective by the SEC on August 10,
2023. The offering of the Preferred Shares (and the shares of
Common Stock issuable upon conversion of such Preferred Shares) in
the registered direct offering is made only by means of a
prospectus, including a prospectus supplement, forming a part of
the effective registration statement. A final prospectus supplement
and accompanying prospectus relating to the registered direct
offering will be filed with the SEC.
The additional Preferred Shares not being offered in the
registered direct offering as well as the Warrants described above
are being issued in a concurrent private placement under Section
4(a)(2) of the Securities Act of 1933, as amended (the
“Securities Act”), and Regulation D promulgated thereunder
and, along with the shares of Common Stock underlying such
additional Preferred Shares and Warrants, have not been registered
under the Securities Act, or applicable state securities laws.
Accordingly, the additional Preferred Shares, Warrants and the
underlying shares of Common Stock issuable upon conversion of such
additional Preferred Shares and Warrants may not be offered or sold
in the United States except pursuant to an effective registration
statement or an applicable exemption from the registration
requirements of the Securities Act and such applicable state
securities laws.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
shares of the Company’s common stock in any state or other
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such state or other jurisdiction.
For more information on Alzamend, stockholders, investors, and
any other interested parties may read Alzamend’s public filings and
press releases available under the Investor Relations section at
https://www.alzamend.com/ or available at https://www.sec.gov/.
About Alzamend Neuro
Alzamend Neuro is a clinical-stage biopharmaceutical company
focused on developing novel products for the treatment of
Alzheimer’s, BD, MDD and PTSD. Our mission is to rapidly develop
and market safe and effective treatments. Our current pipeline
consists of two novel therapeutic drug candidates, AL001 - a
patented ionic cocrystal technology delivering lithium via a
therapeutic combination of lithium, salicylate and L-proline, and
ALZN002 - a patented method using a mutant-peptide sensitized cell
as a cell-based therapeutic vaccine that seeks to restore the
ability of a patient’s immunological system to combat Alzheimer’s.
Both of our product candidates are licensed from the University of
South Florida Research Foundation, Inc. pursuant to royalty-bearing
exclusive worldwide licenses.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements generally include
statements that are predictive in nature and depend upon or refer
to future events or conditions, and include words such as
“believes,” “plans,” “anticipates,” “projects,” “estimates,”
“expects,” “intends,” “strategy,” “future,” “opportunity,” “may,”
“will,” “should,” “could,” “potential,” or similar expressions.
Statements that are not historical facts are forward-looking
statements. Forward-looking statements are based on current beliefs
and assumptions that are subject to risks and uncertainties.
Forward-looking statements speak only as of the date they are made,
and Alzamend undertakes no obligation to update any of them
publicly in light of new information or future events. Actual
results could differ materially from those contained in any
forward-looking statement as a result of various factors. More
information, including potential risk factors, that could affect
Alzamend’s business and financial results are included in
Alzamend’s filings with the U.S. Securities and Exchange
Commission. All filings are available at www.sec.gov and on
Alzamend’s website at www.Alzamend.com.
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Email: Info@Alzamend.com or call: 1-844-722-6333
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