On January 17, 2019 Seneca Biopharma, Inc. (Nasdaq:SNCA), a clinical-stage biopharmaceutical company developing novel treatments for various diseases of high unmet medical need, reported the agreement by several accredited investors to exercise certain warrants to purchase up to an aggregate of 5,555,554 shares of common stock having an exercise price of $2.70 issued by the company on July 30, 2019, at a reduced exercise price of $1.36 per share, priced at-the-market under Nasdaq rules (Press release, Seneca Biopharma, JAN 17, 2020, View Source [SID1234553313]).

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The shares of common stock issuable upon exercise of the warrants are registered pursuant to a registration statement on Form S-1 (File No. 333-232273) which became effective by the Securities and Exchange Commission (SEC) on July 25, 2019. The gross proceeds to the company from the exercise of the warrants are expected to be approximately $7.55 million, prior to deducting placement agent fees and estimated offering expenses.

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

In consideration for the immediate exercise of the warrants for cash, the exercising holders will receive new unregistered warrants to purchase shares of common stock in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the "1933 Act"). The warrants will be exercisable into an aggregate of up to 5,555,554 shares of common stock, at an exercise price of $1.23 per share, 2,777,777 of which have a term of exercise equal to two years and 2,777,777 of which have a term of exercise equal to five years.

Seneca intends to use the net proceeds from the offering as working capital for general business purposes, including continued development of SNCA’s stem cell assets and seeking partnership opportunities, as well as pursuing the in-licensing or acquisition of new innovative medicines to strengthen SNCA’s pipeline.

The new warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the 1933 Act and, along with the shares of common stock issuable upon their exercise, have not been registered under the 1933 Act, and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from such registration requirements. The securities were offered only to accredited investors. The company has agreed to file a registration statement with the SEC covering the resale of the shares of common stock issuable upon exercise of the new warrants.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any state or 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 jurisdiction.