Exhibit 4.1
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED (I)
UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR (II) WITHOUT AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO THE COMPANY, THAT SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.
FORM OF
WARRANT TO PURCHASE STOCK1
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Company
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ROCKWELL MEDICAL, INC.
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Number of Shares
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[ ]
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Type/Series of Stock
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Common Stock
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Warrant Price
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$[ ]per share
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Issue Date
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[ ]
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Expiration Date
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[ ] (See also Section 5.1(b))
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Credit Facility
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This Warrant to Purchase Stock (“Warrant”) is issued in connection with
that certain Loan and Security Agreement, dated March 16, 2020, among Innovatus Life Sciences Lending Fund I, LP, as Lender
and Collateral Agent, the Lenders from time to time party thereto, and the Company (as modified, amended and/or restated from
time to time, the “Loan Agreement”).
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THIS WARRANT CERTIFIES
THAT, for good and valuable consideration, Innovatus Life Sciences Lending Fund I, LP
(“Innovatus”), a Delaware limited partnership with an office located at 777 Third Avenue, 25th Floor, New York,
NY 10017 (together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise
hereof, “Holder”) is entitled to purchase the number of fully paid and non-assessable shares (the “Shares”)
of the above-stated Type/Series of Stock (the “Class”) of the above-named company (the “Company”)
at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the
provisions and upon the terms and conditions set forth in this Warrant.
SECTION
1.
EXERCISE.
1.1 Method
of Exercise. Holder may at any time and from time to time exercise this Warrant, in whole or in part, by delivering to
the Company the original of this Warrant together with a duly executed Notice of Exercise in substantially the form attached
hereto as Appendix 1 and, unless Holder is exercising this Warrant pursuant to a cashless exercise set forth in Section 1.2,
a check, wire transfer of same-day funds (to an account designated by the Company), or other form of payment acceptable to
the Company for the aggregate Warrant Price for the Shares being purchased.
1
The Company acknowledges and agrees that the Warrant issued in connection with the Term A Loan under, and as defined in,
the Loan Agreement, will be at the lower of (i) the volume weighted average closing price of Rockwell’s stock for the 5-trading
day period ending on the last trading day immediately preceding the execution of the Loan Agreement or (ii) the closing price
on the last trading day immediately preceding the execution of the Loan Agreement, and that, in the event the Company draws the
Term B Loan and/or the Term C Loan, each as defined therein, the Company shall issue the Holder additional Warrants to purchase
shares of the Company’s common stock, equal to 3.50% of the funded amount of such Term B and Term C Loans, respectively,
at the lower of (i) Warrant Price for this Warrant or (ii) the volume weighted average closing price of Rockwell’s stock
for the 5-trading day period ending on the last trading day immediately preceding the funding of the Term B Loan or Term C Loan,
as applicable.
1.2
Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the aggregate Warrant Price in the manner
as specified in Section 1.1 above, but otherwise in accordance with the requirements of Section 1.1, Holder may elect to receive
Shares equal to the value of this Warrant, or portion hereof as to which this Warrant is being exercised. Thereupon, the Company
shall issue to the Holder such number of fully paid and non-assessable Shares as are computed using the following formula:
X = Y(A-B)/A
where:
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X =
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the
number of Shares to be issued to the Holder;
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Y =
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the number of Shares with respect
to which this Warrant is being exercised (inclusive of the Shares surrendered to the
Company in payment of the aggregate Warrant Price);
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A =
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the
Fair Market Value (as determined pursuant to Section 1.3 below) of one Share; and
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1.3
Fair Market Value. If the Company’s common stock is then traded or quoted on a nationally recognized securities
exchange, inter-dealer quotation system or over-the-counter market (a “Trading Market”) and the Class is common
stock, the fair market value of a Share shall be the closing price or last sale price of a share of common stock reported for
the Business Day immediately before the date on which Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded or quoted on a Trading Market, the Board of Directors of the Company
shall determine the fair market value of a Share in its reasonable good faith judgment.
1.4
Delivery of Certificate and New Warrant. Promptly after Holder exercises this Warrant in the manner set forth in
Section 1.1 or 1.2 above, the Company shall deliver to Holder a certificate representing the Shares issued to Holder upon such
exercise and, if this Warrant has not been fully exercised and has not expired, a new warrant of like tenor representing the Shares
not so acquired.
1.5
Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably
satisfactory in form, substance and amount to the Company or, in the case of mutilation, on surrender of this Warrant to the Company
for cancellation, the Company shall, within a reasonable time, execute and deliver to Holder, in lieu of this Warrant, a new warrant
of like tenor and amount.
1.6
Treatment of Warrant Upon Acquisition of Company.
(a) Acquisition.
For the purpose of this Warrant, “Acquisition” means any transaction or series of related transactions
involving: (i) the sale, lease, exclusive license or other disposition of all or substantially all of the assets of the
Company; (ii) any merger or consolidation of the Company into or with another person or entity (other than a merger or
consolidation effected exclusively to change the Company’s domicile), or any other corporate reorganization, in which
the stockholders of the Company in their capacity as such immediately prior to such merger, consolidation or reorganization,
own less than a majority of the Company’s (or the surviving or successor entity’s) outstanding voting power
immediately after such merger, consolidation or reorganization; or (iii) any sale or other transfer by the stockholders of
the Company of shares representing a majority of the Company’s then-total outstanding combined voting power.
(b)
Treatment of Warrant at Acquisition. In the event of an Acquisition in which the consideration to be received by
the Company’s stockholders consists solely of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this Warrant pursuant to Section
1.1 and/or 1.2 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Acquisition
or (ii) if Holder elects not to exercise the Warrant, this Warrant will expire immediately prior to the consummation of such Acquisition.
(c)
The Company shall provide Holder with written notice of its request relating to the Cash/Public Acquisition (together with
such reasonable information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated
Cash/Public Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) Business Days prior
to the closing of the proposed Cash/Public Acquisition. Notwithstanding the foregoing, if, immediately prior to the Cash/Public
Acquisition, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance
with Section 1.3 above would be greater than the Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which
it shall not previously have been exercised, and the Company shall promptly notify the Holder of the number of Shares (or such
other securities) issued upon such exercise to the Holder.
(d)
Upon the closing of any Acquisition other than a Cash/Public Acquisition defined above, the acquiring, surviving or successor
entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities
and/or other property as would have been paid for the Shares issuable upon exercise of the unexercised portion of this Warrant
as if such Shares were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time
in accordance with the provisions of this Warrant.
(e)
As used in this Warrant, “Marketable Securities” means securities meeting all of the following requirements:
(i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing of all required reports and
other information under the Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to exercise this Warrant on or prior to the closing
thereof is then traded in Trading Market; and (iii) Holder would be able to publicly re-sell, within six (6) months following
the closing of such Acquisition, all of the issuer’s shares and/or other securities that would be received by Holder in
such Acquisition were Holder to exercise this Warrant in full on or prior to the closing of such Acquisition.
SECTION
2.
ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.
2.1
Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or distribution on the outstanding shares
of the Class payable in common stock or other securities or property (other than cash), then upon exercise of this Warrant, for
each Share acquired, Holder shall receive, without additional cost to Holder, the total number and kind of securities and property
which Holder would have received had Holder owned the Shares of record as of the date the dividend or distribution occurred. If
the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares, the
number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased.
If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of
shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.
2.2
Reclassification, Exchange, Combinations or Substitution. Upon any event whereby all of the outstanding shares of
the Class are reclassified, exchanged, combined, substituted, or replaced for, into, with or by Company securities of a different
class and/or series, then from and after the consummation of such event, this Warrant will be exercisable for the number, class
and series of Company securities that Holder would have received had the Shares been outstanding on and as of the consummation
of such event, and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant.
The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.
2.3
Intentionally Omitted.
2.4
Intentionally Omitted.
2.5
No Fractional Share. No fractional Share shall be issuable upon exercise of this Warrant and the number of Shares
to be issued shall be rounded down to the nearest whole Share. If a fractional Share interest arises upon any exercise of the
Warrant, the Company shall eliminate such fractional Share interest by paying Holder in cash the amount computed by multiplying
the fractional interest by (a) the fair market value (as determined in accordance with Section 1.3 above) of a full Share, less
(b) the then-effective Warrant Price.
2.6
Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class and/or number of Shares,
the Company, at the Company’s expense, shall notify Holder in writing within a reasonable time setting forth the adjustments
to the Warrant Price, Class and/or number of Shares and facts upon which such adjustment is based. The Company shall, upon written
request from Holder, furnish Holder with a certificate of its Chief Financial Officer, including computations of such adjustment
and the Warrant Price, Class and number of Shares in effect upon the date of such adjustment.
SECTION
3.
REPRESENTATIONS
AND COVENANTS OF THE COMPANY.
3.1
Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder as follows:
(a)
[The initial Warrant Price referenced on the first page of this Warrant is not greater than the lower of (i) the volume
weighted average closing price of Rockwell’s stock for the 5-trading day period ending on the last trading day immediately
preceding the execution of the Loan Agreement or (ii) the closing price on the last trading day immediately preceding the execution
of the Loan Agreement.]2 [The initial Warrant Price referenced on the first
page of this Warrant is not greater than the lower of (i) Warrant Price for the Warrant issued by the Company to the Holder on
March 16, 2020 or (ii) the volume weighted average closing price of Rockwell’s stock for the 5-trading day period ending
on the last trading day immediately preceding the Issue Date.]3
(b)
All Shares which may be issued upon the exercise of this Warrant, and all securities, if any, issuable upon conversion
of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and non-assessable, and free of any liens
and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.
The Company covenants that it shall at all times cause to be reserved and kept available out of its authorized and unissued capital
stock such number of shares of the Class, common stock and other securities as will be sufficient to permit the exercise in full
of this Warrant and the conversion of the Shares into common stock or such other securities.
(c)
The Company’s capitalization table attached hereto as Schedule 1 is true and complete, in all material respects,
as of the Issue Date.
3.2
Notice of Certain Events. If the Company proposes at any time to:
(a)
declare any dividend or distribution upon the outstanding shares of the Class or common stock, whether in cash, property,
stock, or other securities and whether or not a regular cash dividend;
(b)
offer for subscription or sale pro rata to the holders of the outstanding shares of the Class any additional shares of
any class or series of the Company’s stock (other than pursuant to contractual pre-emptive rights);
(c)
effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding
shares of the Class; or
(d)
effect an Acquisition or to liquidate, dissolve or wind up;
then, in connection with each such event,
the Company shall give Holder:
(1) at least
seven (7) Business Days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription
rights (and specifying the date on which the holders of outstanding shares of the Class will be entitled thereto) or for determining
rights to vote, if any, in respect of the matters referred to in (a) and (b) above; and
(2) in
the case of the matters referred to in (c) and (d) above at least seven (7) Business Days prior written notice of the date
when the same will take place (and specifying the date on which the holders of outstanding shares of the Class will be
entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event).
2 To
be included for the Term A Warrants.
3 To
be included for the Term B Warrants and Term C Warrants, as applicable.
Reference is made to Section 1.6(c) whereby
this Warrant will be deemed to be exercised pursuant to Section 1.2 hereof if the Company does not give written notice to Holder
of a Cash/Public Acquisition as required by the terms hereof. Company will also provide information requested by Holder that is
reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements.
3.3
Registration Rights. In the event that the Company files a resale registration statement at any time after the Issue
Date, the Company will use reasonable efforts to include the securities to be acquired upon exercise of this Warrant in such resale
registration statement.
SECTION
4.
REPRESENTATIONS,
WARRANTIES OF THE HOLDER.
The Holder represents
and warrants to the Company as follows:
4.1
Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder
are being acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale
or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of
acquiring this Warrant or the Shares.
4.2
Disclosure of Information. Holder is aware of the Company’s business affairs and financial condition and has
received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision
with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions
and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities
and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.
4.3
Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves
substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that
Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such
knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment
in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and
certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character,
business acumen and financial circumstances of such persons.
4.4
Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated
under the Act.
4.5 The
Act. Holder understands that this Warrant and the Shares issuable upon exercise hereof have not been registered under the
Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature
of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon
any exercise hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable
state securities laws, or unless exemption from such registration and qualification are otherwise available. Holder is aware
of the provisions of Rule 144 promulgated under the Act.
4.6
No Voting Rights. Holder, as a Holder of this Warrant, will not have any voting rights until the exercise of this
Warrant.
SECTION
5. MISCELLANEOUS.
5.1
Term and Automatic Conversion Upon Expiration.
(a)
Term. Subject to the provisions of Section 1.6 above, this Warrant is exercisable in whole or in part at any time
and from time to time on or before 6:00 P.M., Eastern time, on the Expiration Date and shall be void thereafter.
(b)
Automatic Cashless Exercise upon Expiration. In the event that, upon the Expiration Date, the fair market value
of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Section 1.3 above is greater
than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised
pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised,
and the Company shall, within a reasonable time, deliver a certificate representing the Shares (or such other securities) issued
upon such exercise to Holder.
5.2
Legends. The Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any)
shall be imprinted with a legend in substantially the following form:
THE SHARES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE ISSUER TO Innovatus
Life Sciences Lending Fund I, LP DATED MARCH 16, 2020, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED (I) UNLESS
AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR (II) WITHOUT AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO THE ISSUER, THAT SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.
5.3
Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant
(and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned
in whole or in part except in compliance with applicable federal and state securities laws by the transferor and the transferee
(including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to
the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if
the transfer is to an affiliate of Holder. Additionally, the Company shall also not require an opinion of counsel if there is
no material question as to the availability of Rule 144 promulgated under the Act.
5.4
Transfer Procedure. Subject to the provisions of Section 5.3 and upon providing the Company with written notice,
Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable
directly or indirectly, upon conversion of the Shares, if any) to any transferee, provided, however, in connection
with any such transfer, Holder will give the Company notice of the portion of the Warrant being transferred with the name, address
and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the
transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with
the Company to be bound by all of the terms and conditions of this Warrant.
5.5
Notices. All notices and other communications hereunder from the Company to the Holder, or vice versa, shall be
deemed delivered and effective (i) when given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual receipt if given by facsimile or electronic mail
and such receipt is confirmed in writing by the recipient, or (iv) on the first Business Day following delivery to a reliable
overnight courier service, courier fee prepaid, in any case at such address as may have been furnished to the Company or Holder,
as the case may be, in writing by the Company or such Holder from time to time in accordance with the provisions of this Section
5.5. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection
with a transfer or otherwise:
INNOVATUS LIFE SCIENCES LENDING FUND I, LP
777 Third Avenue, 25th Floor
New York, NY 10017
Attention: Claes Ekstrom
Notice to the Company
shall be addressed as follows until Holder receives notice of a change in address:
ROCKWELL MEDICAL, INC.
411 Hackensack Avenue, Suite 501
Hackensack, NJ 07601
Attn: Chief Financial Officer
With a copy (which shall not constitute notice) to:
Gibson, Dunn & Crutcher LLP
555 Mission Street, Suite 3000
San Francisco, CA 94105
5.6
Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated (either generally or in
a particular instance and either retroactively or prospectively) only by an instrument in writing signed by the party against
which enforcement of such change, waiver, discharge or termination is sought.
5.7
Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this
Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute,
including reasonable attorneys’ fees.
5.8
Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed in counterparts, all of which together
shall constitute one and the same agreement. Any signature page delivered electronically or by facsimile shall be binding to the
same extent as an original signature page with regards to any agreement subject to the terms hereof or any amendment thereto.
5.9
Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of New York,
without giving effect to its principles regarding conflicts of law.
5.10
Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect
the meaning of any provision of this Warrant.
5.11
Business Days. “Business Day” is any day that is not a Saturday, Sunday or a day on which banks
in New York, New York are closed.
[Signature page follows]
IN WITNESS WHEREOF,
the parties have caused this Warrant to Purchase Stock to be executed by their duly authorized representatives effective as of
the Issue Date written above.
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“COMPANY”
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ROCKWELL MEDICAL, INC.
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By:
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“HOLDER”
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INNOVATUS LIFE SCIENCES LENDING FUND I, LP
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By:
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APPENDIX
1
NOTICE
OF EXERCISE
1. The
undersigned Holder hereby exercises its right purchase ___________ shares of the Common Stock of ROCKWELL MEDICAL, INC. (the “Company”)
in accordance with the attached Warrant To Purchase Stock, and tenders payment of the aggregate Warrant Price for such shares
as follows:
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check in the amount of $________ payable
to order of the Company enclosed herewith
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¨
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Wire transfer of immediately available funds to
the Company’s account
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¨
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Cashless Exercise pursuant to Section 1.2 of the
Warrant
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¨
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Other [Describe] __________________________________________
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2. Please
issue a certificate or certificates representing the Shares in the name specified below:
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___________________________________________
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Holder’s Name
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___________________________________________
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___________________________________________
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(Address)
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3. By
its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Section
4 of the Warrant to Purchase Stock as of the date hereof.
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HOLDER:
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By:
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Name:
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Title:
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(Date):
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Appendix
1
SCHEDULE
1
Company Capitalization Table
The number of shares of common stock outstanding as of
November 12, 2019 was 63,955,893 (as set forth in the Company’s quarterly report on Form 10-Q filed with the SEC).
Schedule 1
Exhibit
99.1
FOR
IMMEDIATE RELEASE
Rockwell
Medical, Inc. Announces $35 Million Debt Financing Agreement with Innovatus Capital Partners, LLC
- First $22.5 million tranche funded at closing -
WIXOM,
Mich., March 17, 2020 – Rockwell Medical, Inc. (NASDAQ:RMTI) (“Rockwell Medical” or the “Company”),
a biopharmaceutical company dedicated to transforming anemia management and improving outcomes for patients around the world,
today announced that it has entered into a debt financing agreement with an affiliate of Innovatus Capital Partners, LLC ("Innovatus")
to provide the Company with up to $35.0 million in term loans.
"We
are pleased to partner with Innovatus on this transaction," said Stuart Paul, President and Chief Executive Officer of Rockwell
Medical. “This financing will provide flexibility as we continue our mission to advance our novel therapeutic, Triferic,
and to transform the way anemia is managed around the world,” concluded Mr. Paul.
On
March 16, 2020, the Company entered into a loan and security agreement (the "Loan Agreement") with Innovatus pursuant
to which Innovatus has agreed to make certain term loans in the aggregate principal amount of up to $35.0 million, with the funding
of the first $22.5 million tranche funded at closing. The Company will be eligible to draw on a second tranche of $5,000,000 upon
achievement of certain milestones, including the U.S. Food and Drug Administration approval of the Company’s NDA for I.V.
Triferic. The Company will be eligible to draw on a third tranche of $7.5 million upon the achievement of certain additional milestones,
including the achievement of certain Triferic sales thresholds. The Company is entitled to make interest-only payments for thirty
months, or up to thirty-six months if certain conditions are met. The loans will mature on the fifth anniversary of the initial
funding date. The Loan Agreement includes customary warrant coverage and is secured by all of the Company’s assets. Proceeds
will be used for working capital purposes.
“We
are delighted to partner with Rockwell Medical in its pursuit of transforming anemia management for dialysis patients,” stated
Claes Ekstrom, Managing Director at Innovatus.
This
transaction is the culmination of a multi-step financing process that Rockwell Medical initiated during the fourth quarter of
2019. At the urging of shareholders, the Company prioritized non-dilutive financing options as part of the process, and the Company
consummated the public offering of common stock in February 2020 to help facilitate this non-dilutive financing.
Cantor
Fitzgerald & Co acted as sole financial advisor to Rockwell Medical on this transaction.
Additional
details regarding the Company's financing are included in the Company’s Current Report on Form 8-K which is expected to
be filed with the Securities and Exchange Commission within four business days of the date of this press release.
About
Rockwell Medical
Rockwell
Medical is a biopharmaceutical company dedicated to transforming anemia management in a wide variety of therapeutic areas and
across the globe, improving the lives of very sick patients. The Company’s initial focus is the treatment of anemia in end-stage
renal disease (ESRD). Rockwell Medical's exclusive renal drug therapy, Triferic (ferric pyrophosphate citrate), is the only FDA-approved
therapeutic indicated for iron replacement and maintenance of hemoglobin in hemodialysis patients. The Company has developed multiple
formulations of Triferic (1) FDA-approved Dialysate Triferic, and (2) I.V. Triferic, for which the Company filed a New Drug Application
in May 2019. Rockwell Medical is also an established manufacturer, supplier and leader in delivering high-quality hemodialysis
concentrates/dialysates to dialysis providers and distributors in the U.S. and abroad.
Innovatus
Capital Partners, LLC
Innovatus
Capital Partners, LLC, is an independent adviser and portfolio management firm with approximately $1.65B in assets under management.
Innovatus adheres to an investment strategy that identifies disruptive and growth opportunities across multiple asset categories
with a unifying theme of capital preservation, income generation, and upside optionality. The firm has a dedicated team of life
sciences investment professionals with deep experience in healthcare, including life sciences. Innovatus and its principals have
significant experience providing debt financing to medical device, diagnostics, and biotechnology companies that address unmet
medical needs, improve patient outcomes, and reduce overall healthcare expenditures. Further information can be found at www.innovatuscp.com.
About
Triferic
Triferic
is the only FDA-approved therapy in the U.S. indicated to replace iron and maintain hemoglobin in hemodialysis patients via dialysate
during each dialysis treatment. Triferic has a unique and differentiated mechanism of action which has the potential to benefit
patients and health care economics. Triferic represents a potential innovative medical advancement in hemodialysis patient iron
management– with the potential to become the future standard of care.
Triferic
delivers approximately 5-7 mg iron with every hemodialysis treatment to the bone marrow and maintains hemoglobin without increasing
iron stores (ferritin). Triferic donates iron immediately and completely to transferrin (carrier of iron in the body) upon entry
into the blood and is then transported directly to the bone marrow to be incorporated into hemoglobin, with no increase in ferritin
(stored iron and inflammation) and no reports of anaphylaxis in over 1,000,000 patient administrations, addressing a significant
medical need in overcoming Functional Iron Deficiency (FID) in ESRD patients.
Important
Safety Information
Serious
hypersensitivity reactions, including anaphylactic-type reactions, some of which have been life-threatening and fatal, have been
reported in patients receiving parenteral iron products. Patients may present with shock, clinically significant hypotension,
loss of consciousness, and/or collapse. Monitor patients for signs and symptoms of hypersensitivity during and after hemodialysis
until clinically stable. Personnel and therapies should be immediately available for the treatment of serious hypersensitivity
reactions. Hypersensitivity reactions have been reported in 1 (0.3%) of 292 patients receiving Triferic in two randomized clinical
trials.
Iron
status should be determined on pre-dialysis blood samples. Post dialysis serum iron parameters may overestimate serum iron and
transferrin saturation.
The
most common adverse reactions (≥3% and at least 1% greater than placebo) in controlled clinical studies include: procedural
hypotension (21.6%), muscle spasms (9.6%), headache (9.2%), pain in extremity (6.8%), peripheral edema (6.8%), dyspnea (5.8%),
back pain (4.5%), pyrexia (4.5%), urinary tract infection (4.5%), asthenia (4.1%), fatigue (3.8%), arteriovenous (AV) fistula
thrombosis (3.4%), and AV fistula site hemorrhage (3.4%).
Forward
Looking Statements
Certain
statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities
laws, including, but not limited to, Rockwell Medical’s expectations regarding the consummation of the offering, the terms
of the offering, and the satisfaction of customary closing conditions with respect to the offering and the anticipated use of
the net proceeds of the offering. Words such as “may,” “might,” “will,” “should,”
“believe,” “expect,” “anticipate,” “estimate,” “continue,” “could,”
“plan,” “potential,” “predict,” “forecast,” “project,” “intend”
or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While
Rockwell Medical believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking
statements, which are based on information available to us on the date of this release. These forward-looking statements are based
upon current estimates and assumptions and are subject to various risks and uncertainties (including, without limitation, those
set forth in Rockwell Medical’s SEC filings), many of which are beyond our control and subject to change. Actual results
could be materially different. Risks and uncertainties include: the timing and regulatory approval process for our NDA filing
for I.V. Triferic as filed with the FDA: the timing and receipt of the loan amounts from Innovatus; Rockwell Medical’s ability
to achieve certain milestones under the Loan Agreement; and the anticipated use of proceeds under the Loan Agreement, as well
as those risks more fully discussed in Rockwell Medical’s SEC filings. Accordingly, you should not place undue reliance
on these forward-looking statements. Rockwell Medical expressly disclaims any obligation to update or alter any statements whether
as a result of new information, future events or otherwise, except as required by law.
Triferic®
is a registered trademark of Rockwell Medical, Inc.
Contact
Investor Relations:
Lisa M. Wilson, In-Site Communications, Inc.
T:
212-452-2793
E: lwilson@insitecony.com
Source:
Rockwell Medical, Inc.