On February 4, 2020, Phio Pharmaceuticals Corp. (the "Company") reported that it has entered into a securities purchase agreement with certain institutional and accredited investors (the "Purchase Agreement") relating to the offering and sale of 197,056 shares of Company common stock, par value $0.0001 per share (the "Common Stock") at a purchase price of $8.705 per share (the "Offering") (Filing, 8-K, Phio Pharmaceuticals, FEB 4, 2020, View Source [SID1234553980]). Concurrently with the Offering, and pursuant to the Purchase Agreement, the Company also commenced a private placement whereby it issued and sold warrants (the "Warrants") exercisable for an aggregate of up to 197,056 shares of Common Stock, which represents 100% of the shares of Common Stock sold in the Offering, with a purchase price of $0.125 per underlying warrant share and an exercise price of $8.71 per share (the "Private Placement"). The net proceeds to the Company from the Offering and the Private Placement is approximately $1.4 million, after deducting fees and expenses. Subject to certain ownership limitations, the Warrants are exercisable upon issuance. The Warrants will expire on the 5.5 year anniversary of the date of issuance. None of the Warrants, nor the Warrants Shares, have been registered under the Securities Act of 1933, as amended.

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Pursuant to an engagement letter, dated as of January 31, 2020, between the Company and H.C. Wainwright & Co., LLC, or the placement agent, the Company agreed to pay the placement agent a cash fee of 7.5% and a management fee of 1.0% of the aggregate gross proceeds of the Offering and the Private Placement. The Company also agreed to pay the placement agent $40,000 for non-accountable expenses, $50,000 for legal expenses and $12,900 for clearing fees. In addition, the Company issued to the placement agent warrants to purchase up to 14,779 shares of Common Stock (the "Placement Agent Warrants"), or 7.5% of the aggregate number of shares of Common Stock sold in the Offering. The Placement Agent Warrants are immediately exercisable at an exercise price of $11.0375 per share of Common Stock and expire on February 4, 2025.

The Offering and Private Placement closed on February 6, 2020.

The 197,056 shares of Common Stock sold in the Offering (but not the Warrants or the Warrant Shares) were offered and sold pursuant to a prospectus, dated February 4, 2020, in connection with a takedown from the Company’s shelf registration statement on Form S-3 (File No. 333-224031).

The Warrants, the Warrant Shares, the Placement Agent Warrants and the shares of Common Stock issuable thereunder were sold and issued without registration under the Securities Act of 1933, as amended (the "Securities Act") in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and Rule 506 promulgated under the Securities Act as sales to accredited investors.

The foregoing descriptions of the Purchase Agreement and the Warrants are not complete and are qualified in their entirety by references to the full text of the Purchase Agreement and the Warrants, which are filed as exhibits to this report and are incorporated by reference herein.