Raleigh, NC (GLOBE NEWSWIRE) - Innovate Biopharmaceuticals, Inc. ("Innovate" or the "Company") (Nasdaq: INNT), a clinical stage biotechnology company focused on developing novel autoimmune and inflammation therapeutics, announced that on March 17, 2019, it entered into an agreement (the "Agreement") with SDS Capital Partners II LLC and certain other accredited investors (together, the "Purchasers") providing for the sale by the Company at a purchase price of $2.33 per share as further described below of up to 4,291,845 shares (the "Shares") of its common stock (the "Common Stock"), up to 2,575,107 five-year term warrants with an exercise price as further described below at a premium to the purchase price and up to 4,291,845 12-month term warrants at an exercise price of $4.00 (total of up to 6,866,952 shares of Common Stock).
The 12 month warrants will be immediately exercisable at a price of $4.00 per share for one year, and the five year warrants will be exercisable beginning on the six month anniversary of their issuance at a price equal to the greater of (a) 125% of the volume weighted average price of the Common Stock for the 20 day period prior to the closing date of the private placement and (b) the closing price of the Common Stock immediately prior to the closing date of the private placement. If the volume weighted average price of our stock exceeds $5.25 for 10 consecutive days following their issue dates, we will have the right to call the 12 month warrants for cash exercise. The exercise prices of the warrants will be subject to adjustment for, among other things, stock splits, reverse splits, and similar capital transactions, and the warrant holders will have certain rights on an as-exercised basis as holders of Common Stock in the event of certain distributions and fundamental transactions. The warrants will be exercisable on a "cashless" basis only in certain circumstances.