Quarterly report pursuant to Section 13 or 15(d)

Stockholders??? Equity (Deficit)

v3.23.1
Stockholders’ Equity (Deficit)
 6 Months Ended
Mar. 31, 2023
Equity [Abstract]  
Stockholders’ Equity (Deficit)

6. Stockholders’ Equity (Deficit)

 

The Company entered into an At-the-Market Sales Agreement with BTIG, LLC (“BTIG”) on August 15, 2022 (the “2022 Sales Agreement”). Pursuant to the 2022 Sales Agreement, the Company may offer and sell, from time to time, through BTIG, as sales agent and/or principal, shares of its common stock having an aggregate offering price of up to $25.0 million, subject to certain limitations on the amount of common stock that may be offered and sold by the Company set forth in the 2022 Sales Agreement. Due to the offering limitations applicable to the Company, the Company filed prospectus supplements for the sale of shares of its common stock for an aggregate offering price of up to $7.8 million pursuant to the 2022 Sales Agreement. During the six months ended March 31, 2023, the Company sold an aggregate of 3,007,429 shares of common stock pursuant to the 2022 Sales Agreement with BTIG for gross proceeds of $5.7 million and net proceeds of $5.4 million. As of March 31, 2023, there are no registered shares remaining to be sold under the 2022 Sales Agreement.

 

On February 10, 2023, the Company closed a public offering of common stock and certain warrants through Chardan Capital Markets, LLC and EF Hutton, division of Benchmark Investments LLC as underwriters, for gross proceeds of $15.0 million and net proceeds of $13.6 million through the issuance and sale of 11,664,888 shares of its common stock and, to certain investors, pre-funded warrants to purchase 2,224,000 shares of common stock, and accompanying common warrants to purchase up to an aggregate of 27,777,776 shares of its common stock (the “February Offering”). Each share of common stock and pre-funded warrant to purchase one share of common stock was sold together with a common warrant to purchase two shares of common stock. The public offering price of each share of common stock and accompanying common warrant was $1.08 and the public offering price of each pre-funded warrant and accompanying common warrant was $1.0799.

 

The common stock warrants are immediately exercisable at a price of $1.08 per share of common stock, expire five years from the date of issuance and contain an alternative cashless exercise provision whereby, subject to certain conditions, a warrant may be exercised in a cashless transaction for shares of common stock at the rate of half a share of common stock per full share otherwise issuable upon a cash exercise. The pre-funded warrants are immediately exercisable at any time, until exercised in full, at a price of $0.0001 per share of common stock.

 

 

Sonnet BioTherapeutics Holdings, Inc.

Notes to Unaudited Interim Consolidated Financial Statements

 

In addition, warrants to purchase 972,222 shares of common stock were issued to the underwriters as compensation for their services related to the offering. These common stock warrants have an exercise price of $1.35 per share and expire five years from the date of issuance.

 

Common stock warrants

 

As of March 31, 2023, the following equity-classified warrants and related terms were outstanding:

 

   

Warrants

Outstanding

     Exercise Price     Expiration Date
Common stock warrants August 2021     2,827,708     $ 11.90     August 24, 2024
Underwriter warrants August 2021     50,416     $ 14.875     August 19, 2024
Chanticleer warrants     1,267       $ 819.00 -
 $ 1,274.00		     April 30, 2027 - December 17, 2028
Series C warrants     809,243     $ 44.66     October 16, 2025
Series 3 warrants     276,140     $ 4.074     August 15, 2027
Common stock warrants February 2023     27,314,814     $ 1.08     February 10, 2028
Pre-funded warrants February 2023     2,224,000     $ 0.0001     N/A
Underwriter warrants February 2023     972,222     $ 1.35     February 8, 2028
      34,475,810              

 

During the three and six months ended March 31, 2023, 462,962 of common stock warrants from the February Offering were net share settled, resulting in the issuance of 231,481 shares of common stock.

 

During the six months ended March 31, 2023, 3,026 of Series B warrants were net share settled, resulting in the issuance of 3,026 shares of common stock.

 

During the three and six months ended March 31, 2023, 2,059 and 7,549, respectively, of private warrants expired.

 

In April 2023, 11,207,408 of common stock warrants from the February Offering were net share settled, resulting in the issuance of 5,603,704 shares of common stock.

 

In April 2023, 528,000 of the pre-funded warrants from the February Offering were net share settled, resulting in the issuance of 527,826 shares of common stock.

 

In April 2023, 848,000 of the pre-funded warrants from the February Offering were exercised on a cash basis. The Company received de minimus proceeds in exchange for the issuance of 848,000 shares of common stock.

 

 

Sonnet BioTherapeutics Holdings, Inc.

Notes to Unaudited Interim Consolidated Financial Statements