Item 1.01. Entry into a Material Definitive Agreement.
Private Placement Transaction
On August 10, 2016,
TapImmune Inc. (the “Company”) completed a private placement of units with certain accredited investors under Rule 506 of Regulation D (the “Offering”). The units (“Units”) consisted of (i) one share of the
Company’s common stock, par value $0.001 per share and (ii) one five-year warrant to purchase one share of Company common stock for $0.50 (the “PIPE Warrants”). The Company issued and sold an aggregate of 6.25 million Units at a
purchase price per Unit of $0.40 for an aggregate of $2.5 million, pursuant to Subscription Agreements, in which the Company and investors made customary representations to each other.
Pursuant to a Registration Rights Agreement entered into in connection with the Offering, promptly, but no later than 120 calendar days after the closing of
the Offering, the Company is required to file a registration statement (the “Registration Statement”) with the Securities and Exchange Commission (the “SEC”) registering for resale (a) the common stock issued in the Offering; (b)
the shares of common stock issuable upon the exercise of the PIPE Warrants; and (c) the shares of common stock issuable upon the exercise of the warrants issued to Katalyst Securities LLC, which acted as placement agent in the Offering (as described
below). The Company is required to use its commercially reasonable efforts to ensure that the Registration Statement is declared effective within 90 calendar days after filing with the SEC.
The foregoing is a summary of the terms of the PIPE Warrant, Subscription Agreement and the Registration Rights Agreement and does not purport to be
complete. The foregoing summary is qualified in its entirety by reference to the full text of the PIPE Warrant, Subscription Agreement and the Registration Rights Agreement, copies of which are filed herewith as Exhibits 4.1, 10.1 and 10.2 and
incorporated herein by reference.
Warrant Exercises
Simultaneously with the closing of the Offering, holders of an aggregate of 7 million outstanding Series C Warrants and 5 million Series C-1 Warrants, each
providing for the purchase of one share of Company common stock for $0.50 per share, entered into binding commitments to exercise their warrants for an aggregate exercise price of $6,000,000. Closing of the exercise of the warrants is
conditioned on the closing of the Warrant Restructuring transaction described below.
Warrant Restructuring
Simultaneous with the closing of the Offering, the Company and holders of an aggregate of 37,159,975 outstanding Series A Warrants, Series A-1 Warrants, Series
C Warrants, Series C-1 Warrants, Series D Warrants, Series D-1 Warrants, Series E Warrants and Series E-1 Warrants (the “Outstanding Series Warrants”) entered into Warrant Amendment Agreements, dated August 10, 2016 (the “Amendment
Agreement”), in which they agreed to amend the terms of the Outstanding Series Warrants to remove provisions from the Outstanding Series Warrants that had previously caused them to be classified as a derivative liability as opposed to equity on
the
Company’s balance sheets. In consideration for such amendment and the exercise of the Series C Warrants and Series C-1 Warrants, the Company issued an aggregate of 9 million additional
shares of common stock to such warrant holders and new five-year warrants to purchase 12 million shares of Company common stock at an exercise price of $0.60 per share (the “Series F Warrants”).
The Company incurred approximately $925,000 in expenses relating to the Offering, the exercise of the outstanding Series C Warrant and Series C-1 Warrants and
the amendment of the Outstanding Series Warrants, including agency fees described below, resulting in net proceeds to the Company of approximately $7.6 million. The Company intends to use the net proceeds for general corporate purposes,
including clinical trial expenses and research and development expenses.
The foregoing is a summary of the terms of the amended Outstanding Series
Warrants, the Series F Warrant and the Amendment Agreement and does not purport to be complete. The foregoing summary is qualified in its entirety by reference to the full text of the forms of the Outstanding Series Warrants, the Series F
Warrant and the Amendment Agreement, copies of which are filed herewith as Exhibits 4.2, 4.3, 4.4, 4.5, 4.6, 4.7, 4.8, 4.9 and 10.3, respectively, and incorporated herein by reference.
Agency Agreement; Agent Warrants
Pursuant to
an Agency Agreement, dated July 21, 2016, as amended by the First Amendment, dated July 29, 2016, by and between the Company and Katalyst Securities LLC (“Katalyst”) and GP Nurmenkari Inc. (“GPN”) (the “Agency
Agreement”), Katalyst and GPN agreed to act as the Company’s agents in connection with the Offering and GPN agreed to act as the Company’s agent in connection with the solicitation of the amendment of the Outstanding Series Warrants
and the exercise of the outstanding Series C Warrants.
Pursuant to the Agency Agreement, the Company agreed to pay to Katalyst: (i) an aggregate cash fee
for placement agent and financial advisory services equal to 10% of the gross proceeds of the Offering from investors first contacted by Katalyst in connection with the Offering; (ii) warrants to purchase a number of shares of common stock of the
Company equal to 10% of the number of shares sold in the Offering to investors first contacted by Katalyst in connection with the Offering (the “Katalyst Warrants”); (iii) legal fees and expenses in the aggregate amount of $50,000 plus
(iv) its reasonable out-of-pocket expenses up to an aggregate of $10,000 in expenses. The Katalyst Warrants have the same terms as the PIPE Warrants issued in the Offering, except that the exercise price of the Katalyst Warrants is $0.40.
Pursuant to the Agency Agreement, the Company will pay a cash fee to GPN equal to 7% of (i) the gross proceeds of the Offering from investors first contacted
by GPN in connection with the Offering and (ii) the proceeds from the exercise of the Series C Warrants. GPN will not receive any warrants or be paid any fee in connection with the exercise of the Series C-1 Warrants. The Company will also
reimburse GPN for its legal fees and expenses up to an aggregate amount of $10,000, plus its reasonable out-of-pocket expenses up to an aggregate of $500 in expenses.
The foregoing descriptions of the Agency Agreement and the Katalyst Warrant are only summaries of their material
terms and do not purport to be complete. A copy of the Agency Agreement is attached hereto as Exhibit 10.4 and is incorporated herein by reference.