Dermata Therapeutics, Inc. 10-Q

ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS (a) On April 20, 2022, we entered into a Securities Purchase Agreement (“Purchase Agreement”) with an institutional investor (the “Purchaser”) pursuant to which we issued to the Purchaser in a private placement, an aggregate of 898,585 shares (“Shares”) of our common stock, pre-funded warrants to purchase up to 2,875,000 shares of our common stock (the “Pre Funded Warrants”) and warrants (the “Common Stock Warrants” and together with the Pre Funded Warrants, the “Warrants”) to purchase up to 3,773,585 shares of our common stock (the “Private Placement”). The purchase price per share of common stock and associated Common Stock Warrant was $1.325 and the purchase price per Pre Funded Warrant and associated Common Stock Warrant was $1.3249. Each Common Stock Warrant entitles the holder to purchase one share of common stock at an exercise price of $1.325 per share. Each Pre Funded Warrant entitles the holder to purchase one share of common stock at an exercise price of $0.0001 per share. The Common Stock Warrants are exercisable for a period of five years commencing on the issuance date and the Pre Funded Warrants are exercisable until exercised. The Warrants also contain customary beneficial ownership limitations that may be waived at the option of each holder upon 61 days’ notice to us. The Private Placement closed on April 25, 2022. The gross proceeds to us, before deducting placement agent fees and other offering expenses, are approximately $5.0 million. The shares of common stock, the Warrants and the shares of common stock underlying the Warrants were not registered under the Securities Act of 1933, as amended (the “Securities Act”), and were offered pursuant to the exemption provided in Section 4(a)(2) under the Securities Act and Rule 506(b) promulgated thereunder. On April 20, 2022, in connection with the Private Placement, we entered into a registration rights agreement (the “Registration Rights Agreement”) with the Purchaser, pursuant to which we filed a registration statement on Form S-1 with the Securities and Exchange Commission (the “SEC”) registering for resale the Shares and any shares of our common stock issuable upon exercise of the Warrants within 15 days of the closing of the Private Placement. This resale registration statement was declared effective by the SEC on May 13, 2022. Pursuant to a placement agent agreement (the “Placement Agent Agreement”), Maxim Group, LLC (the “Placement Agent’) was engaged by us to act as our placement agent for the Private Placement. We paid the Placement Agent a cash fee equal to 7.0% of the gross proceeds received in the Private Placement, in addition to the reimbursement of certain expenses. The foregoing descriptions of the Purchase Agreement, the Common Stock Warrants, the Pre Funded Warrants, the Registration Rights Agreement and the Placement Agent Agreement do not purport to be complete and are qualified by reference to the full text of such agreements, which are attached to this Quarterly Report on Form 10-Q, and are incorporated herein by reference. (b) On August 12, 2021, our registration statement on Form S-1 (Registration No. 333-256997) and the related registration statement (File No. 333-258772) was declared effective by the SEC for our initial public offering pursuant to which we sold an aggregate of 2,571,428 shares of its common stock and accompanying warrants to purchase up to 2,571,428 shares of common stock. Each share of common stock was sold together with one warrant to purchase one share of common stock with an exercise price of $7.00 per share at a combined offering price of $7.00, for gross proceeds of approximately $18.0 million, before deducting expenses. Maxim Group LLC acted as the sole book-running manager for the offering. On August 17, 2021, we closed the sale of the shares of Common Stock and warrants to purchase shares of Common Stock, resulting in net proceeds to us of approximately $15.4 million after deducting underwriting discounts and commissions and other offering expenses. No payments were made by us to directors, officers or persons owning ten percent or more of our Common Stock or to their associates, or to our affiliates. There has been no material change in the planned use of proceeds from our initial public offering as described in our final prospectus filed with the SEC on August 16, 2021 pursuant to Rule 424(b). ITEM 3: DEFAULTS UPON SENIOR SECURITIES None noted. ITEM 4: MINE SAFETY DISCLOSURES Not applicable.