Cyclo Therapeutics announces $4.2M registered direct offering

Cyclo Therapeutics, Inc., a clinical stage biotechnology company dedicated to developing life-changing medicines through science and innovation for patients and families living with diseases, today announced that it has entered into a definitive securities purchase agreement for the purchase and sale of 2,608,696 shares of common stock (or common stock equivalents) at a purchase price of $1.61 per share of common stock (or common stock equivalent) in a registered direct offering priced at-the-market under Nasdaq rules.

In addition, in a concurrent private placement, the Company will issue series A-1 warrants to purchase up to 2,608,696 shares of common stock and series A-2 warrants to purchase up to 2,608,696 shares of common stock. Each series of warrants has an exercise price of $1.36 per share and is exercisable on the date of issuance. The series A-1 warrants will have a term of five years from the date of issuance and the series A-2 warrants will have a term of three years from the date of issuance.

H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.

The closing of the offering is expected to occur on or about January 3, 2023, subject to the satisfaction of customary closing conditions. The gross proceeds to the Company from this offering are expected to be approximately $4.2 million, before deducting the placement agent’s fees and other offering expenses payable by the Company. The Company intends to use the net proceeds from this offering for working capital purposes, including the continuation of its pivotal Phase III trial for the treatment of Niemann-Pick Disease Type C with Trappsol® Cyclo™.

The shares of common stock (or common stock equivalents) described above (but not the warrants issued in the concurrent private placement or the shares of common stock underlying such warrants) are being offered by the Company pursuant to a “shelf” registration statement on Form S-3 (File No. 333-254496) previously filed with the Securities and Exchange Commission (the “SEC”) and declared effective by the SEC on May 28, 2021. The offering of the shares of common stock (or common stock equivalents) 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 warrants described above were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and, along with the shares of common stock underlying the warrants, have not been registered under the Securities Act or applicable state securities laws. Accordingly, the warrants and underlying shares of common stock 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 a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction. Business Wire