On April 19, 2023, AIM Immunotech Inc. (the "Company") reported to have entered into an Equity Distribution Agreement (the "Distribution Agreement"), with Maxim Group LLC ("Maxim"), pursuant to which the Company may sell from time to time, shares of its common stock, $0.001 par value per share, having an aggregate offering price of up to $8.5 million (the "Shares") through Maxim, as agent (the "Offering") (Press release, AIM ImmunoTech, APR 19, 2023, View Source [SID1234630295]). On April 19, 2023, the Company filed a prospectus supplement with the Securities and Exchange Commission (the "SEC") in connection with the Offering (the "Prospectus Supplement") under its existing Registration Statement on Form S-3 (File No 333-262280), which became effective on February 4, 2023 (the "Registration Statement"), related to the sale of Shares having an aggregate offering price of up to $100 million.
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Subject to the terms and conditions of the Distribution Agreement, Maxim will use its commercially reasonable efforts to sell the Shares from time to time, based on the Company’s instructions. Under the Distribution Agreement, Maxim may sell the Shares by any method permitted by law deemed to be an "at-the-market" offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the "Securities Act"), including, without limitation, sales made directly on the NYSE American.
The Company has no obligation to sell any of the Shares, and may at any time suspend offers under the Distribution Agreement. The Offering will terminate upon the earlier of (i) the sale of Shares under the Distribution Agreement having an aggregate offering price of $8.5 million, 24 months from the date of the Distribution Agreement or the termination of the Distribution Agreement by either the Company or Maxim upon the provision of fifteen (15) days written notice. In addition, sales of Shares under the Offering shall not exceed $8.5 million, unless and until the Company files an amended or new Prospectus Supplement.
Under the terms of the Distribution Agreement, Maxim will be entitled to a transaction fee at a fixed rate of 3.0% of the gross sales price of Shares sold under the Distribution Agreement. The Company will also reimburse Maxim for certain expenses incurred in connection with the Distribution Agreement, and has agreed to provide indemnification and contribution to Maxim with respect to certain liabilities under the Securities Act and the Securities Exchange Act of 1934, as amended.
The Company intends to use the net proceeds from the sale of Shares for working capital and general corporate purposes.
The foregoing description of the Distribution Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Distribution Agreement, a copy of which is filed hereto as Exhibit 10.1. This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy the Shares, nor shall there by any offer, solicitation or sale of the Shares in any state or country in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or country.
The Distribution Agreement and the above description have been included to provide investors and security holders with information regarding the terms of the Distribution Agreement. They are not intended to provide any other factual information about the Company or its subsidiaries, affiliates or stockholders. The representations, warranties and covenants contained in the Distribution Agreement were made only for purposes of the Distribution Agreement and as of specific dates; were solely for the benefit of the parties to the Distribution Agreement; and may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures made by each contracting party to the other for the purposes of allocating contractual risk between them that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts or condition of the Company or any of its subsidiaries, affiliates, businesses or stockholders. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Distribution Agreement, which subsequent information may or may not be fully reflected in public disclosures or statements by the Company. Accordingly, investors should read the representations and warranties in the Distribution Agreement not in isolation but only in conjunction with the other information about the Company and its subsidiaries that the Company includes in reports, statements and other filings made with the SEC.
Silverman Shin & Byrne PLLC, counsel to the Company, has issued a legal opinion relating to the Shares. A copy of this legal opinion, including the consent included therein, is attached as Exhibit 5.1 hereto.
Any Shares offered and sold in the Offering will be issued pursuant to the Company’s Registration Statement, the prospectus and the Prospectus Supplement relating to the Offering.