Title of Each Class of Securities to be Registered | Amount to be Registered | Proposed Maximum Offering Price per Unit | Proposed Maximum Aggregate Offering Price | Amount of Registration Fee(1) | ||||||||||
| Common Stock, par value $0.0001 per share | (2) | (3) | (3) | — | ||||||||||
| Preferred Stock, par value $0.0001 per share | (2) | (3) | (3) | — | ||||||||||
| Debt Securities | (2) | (3) | (3) | — | ||||||||||
| Warrants | (2) | (3) | (3) | — | ||||||||||
| Total | (2) | $150,000,000 | $16,365 | |||||||||||
(1) Calculated pursuant to Rule 457(o) under the Securities Act of 1933, as amended, or the Securities Act.
(2) There are being registered hereunder such indeterminate number of shares of common stock and preferred stock, such indeterminate principal amount of debt securities and such indeterminate number of warrants to purchase common stock, preferred stock or debt securities as shall have an aggregate initial offering price not to exceed $150,000,000. If any debt securities are issued at an original issue discount, then the principal amount of such debt securities shall be in such greater amount as shall result in an aggregate initial offering price not to exceed $150,000,000, less the aggregate dollar amount of all securities previously issued hereunder. Any securities registered hereunder may be sold separately or in combination with other securities registered hereunder. The securities registered also include such indeterminate number of shares of common stock and preferred stock and amount of debt securities as may be issued upon conversion of or exchange for preferred stock or debt securities that provide for conversion or exchange, upon exercise of warrants or pursuant to the antidilution provisions of any such securities. In addition, pursuant to Rule 416 under the Securities Act, the shares being registered hereunder include such indeterminate number of shares of common stock and preferred stock as may be issuable with respect to the shares being registered hereunder as a result of stock splits, stock dividends or similar transactions.
(3) The proposed maximum aggregate offering price per class of security will be determined from time to time by the registrant in connection with the issuance by the registrant of the securities registered hereunder and is not specified as to each class of security pursuant to General Instruction II.D. of Form S-3 under the Securities Act.
The Registrantregistrant hereby amends this Registration Statementregistration statement on such date or dates as may be necessary to delay its effective date until the Registrantregistrant shall file a further amendment whichthat specifically states that this Registration Statementregistration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statementregistration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
EXPLANATORY NOTE
This registration statement contains:
•a base prospectus, which covers the offering, issuance and sale by the registrant of up to a maximum aggregate offering price of $150,000,000 of the registrant’s common stock, preferred stock, debt securities and/or warrants from time to time in one or more offerings; and
•an equity distribution agreement prospectus, which covers the offering, issuance and sale by the registrant of up to a maximum aggregate offering price of $50,000,000 of the registrant’s common stock that may be issued and sold from time to time under an equity distribution agreement to be entered into with BMO Capital Markets Corp., a Delaware corporation, or the Distribution Agent.
The base prospectus immediately follows this explanatory note. The specific terms of any securities to be offered pursuant to the base prospectus will be specified in a prospectus supplement to the base prospectus. The equity distribution agreement prospectus immediately follows the base prospectus. The $50,000,000 of common stock that may be offered, issued and sold by the registrant under the equity distribution agreement prospectus is included in the $150,000,000 of securities that may be offered, issued and sold by the registrant under the base prospectus. Upon termination of the equity distribution agreement with the Distribution Agent, any portion of the $50,000,000 included in the equity distribution agreement prospectus that is not sold pursuant to the equity distribution agreement will be available for sale in other offerings pursuant to the base prospectus, and if no shares are sold under the equity distribution agreement, the full $150,000,000 of securities may be sold in other offerings pursuant to the base prospectus and a corresponding prospectus supplement.
The information in this prospectus is not complete and may be changed. We may not sell these securities or accept an offer to buy these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting any offeroffers to buy these securities in any jurisdictionstate where thesuch offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MARCH 8, 2019DECEMBER 21, 2020
PROSPECTUS
Common Stock
Preferred Stock
Debt Securities
Warrants
From time to time, we may selloffer up to an aggregate total offering price$150,000,000 of $125,000,000any combination of our shares of Common Stock, Preferred Stock, Debt Securities, Depositary Shares, Warrants, other Rights or Units,the securities described in each casethis prospectus in one or more issuances and at prices and on terms that we will determine at the timeofferings. We may also offer securities as may be issuable upon conversion, redemption, repurchase, exchange or exercise of the offering.any securities registered hereunder, including any applicable antidilution provisions.
This prospectus describesprovides a general description of the general manner in which any of these securities we may be offered using this prospectus. Weoffer. Each time we offer securities, we will specify in an accompanying prospectus supplement theprovide specific terms of the securities offered in a supplement to this prospectus. We may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. The prospectus supplement and other details regardingany related free writing prospectus may also add, update or change information contained in this prospectus. You should carefully read this prospectus, the offering thereof.applicable prospectus supplement and any related free writing prospectus, as well as any documents incorporated by reference, before you invest in any of the securities being offered.
This prospectus may not be used to consummate a sale of any securities unless accompanied by a prospectus supplement.
Our common stock is quotedlisted on the OTCThe Nasdaq Capital Market, Group’s OTCQB® Market quotation systemor Nasdaq, under the ticker symbol “XCUR.” On March 5, 2019,December 17, 2020, the last reported sale price of our common stock on Nasdaq was $2.80$1.58 per share.
The applicable prospectus supplement will contain information, where applicable, as to any other listing on Nasdaq or any securities market or other exchange of the securities, if any, covered by thisthe prospectus may be soldsupplement.
We will sell these securities directly by us to investors, through agents designated by us from time to time or to or through underwriters or dealers, at prices and on terms to be determined at the time of offering. We will include in an applicable prospectus supplement the names of any underwritersa continuous or agents and any applicable commissions or discounts. Additionaldelayed basis. For additional information on the methods of sale, appears underyou should refer to the section titled “Plan of Distribution” in this prospectus. WeIf any agents or underwriters are involved in the sale of any securities with respect to which this prospectus is being delivered, the names of such agents or underwriters and any applicable fees, commissions, discounts or over-allotment options will also describebe set forth in an applicablea prospectus supplementsupplement. The price to the way(s) in which we expect to usepublic of such securities and the net proceeds we expect to receive from any sale.
Investing in our common stock involves a high degree of risk. Before making an investment decision, please read “Risk Factors”You should review carefully the risks and uncertainties described under the heading “Risk Factors” on page 106 of this prospectus and under similar headings in any amendment or supplement to this prospectus or any related free writing prospectus or in any filing with the Securities and Exchange Commission that is incorporated by reference into this prospectus as well as “Special Note Regarding Forward-Looking Statements”described on page 335 of this prospectus. You should read the entire prospectus carefully before you make your investment decision.
Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus or any accompanying prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2019.2020.
TABLE OF CONTENTS
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ABOUT THIS PROSPECTUS
This prospectus is a part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration process. Under this shelf registration process, we may sell any combination of the securities described in this prospectus in one or more offerings up to a total aggregate offering price of $150,000,000. This prospectus provides you with a general description of the securities we may offer.
Each time we sell securities under this prospectus, we will provide a prospectus supplement that will contain specific information about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings. The prospectus supplement and any related free writing prospectus that we may authorize to be provided to you may also add, update or change information contained in this prospectus or in any documents that we have incorporated by reference in this prospectus and in an applicable prospectus supplement tointo this prospectus. We have not authorized any other person to provide you with different or additional information. If anyone provides you with different, additional or inconsistent information, you should not rely on it. We do not take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not making an offer to sell these securities or soliciting any offer to buy these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing inread this prospectus, any applicable prospectus supplement orand any related free writing prospectus, we authorize to be delivered to you is accurate only as of the date of that document or any other date set forth in that document. Additionally, any information we have incorporated by reference in this prospectus or in any applicable prospectus supplement is accurate only as of the date of the document incorporated by reference or other date set forth in that document, regardless of the time of delivery of this prospectus, any applicable prospectus supplement or any sale of securities. Our business, financial condition, results of operations, cash flow and prospects may have changed since that date.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE A SALE OF SECURITIES UNLESS IT IS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
Neither we, nor any agent, underwriter or dealer has authorized any person to give any information or to make any representation other data that have been obtained or compiled from information made available by independent third parties. We have not independently verified the accuracy and completeness of such data. This prospectus, any applicable prospectus supplement and the information incorporated herein or therein by reference include trademarks, service marks and trade names owned by us or other companies. Solely for convenience, we may refer to our trademarks included or incorporated by reference in this prospectus, any applicable prospectus supplement or any free writing prospectus without the TM or ® symbols, but any such references are not intended to indicate that we will not assert, to the fullest extent permitted under applicable law, our rights to our trademarks or other intellectual property. All trademarks, service marks and trade names includedthan those contained or incorporated by reference in this prospectus, any applicable prospectus supplement or any related free writing prospectus are the propertyprepared by or on behalf of their respective owners. Useus or display by us of other parties’ trademarks, trade dress, or products into which we have referred you. This prospectus, any applicable supplement to this prospectus isor any related free writing prospectus do not intendedconstitute an offer to and does not, imply a relationship with,sell or endorsements or sponsorshipthe solicitation of us byan offer to buy any securities other than the trademark or trade dress owners.
This prospectus and the applicable prospectus supplement incorporateinformation incorporated herein by reference contains summaries of certain provisions contained in some of the documents set forth below that we have previously filed withdescribed herein, but reference is made to the SEC (Commission File No. 000-55764), other than information in suchactual documents that is deemed to be furnished and not filed. These documents contain important information about us and our business and financial condition.
All documents that we file (but not those that we furnish) pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, aftersummaries are qualified in their entirety by the dateactual documents. Copies of some of the initialdocuments referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and prior toyou may obtain copies of those documents as described below under the effectiveness of the registration statement shall be deemed to be incorporated by reference into this prospectus and will automatically update and supersede theheading “Where You Can Find More Information.”
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SUMMARY
The following summary highlights information contained elsewhere in this prospectus and any previously filed documents. All documents that we file (but not those that we furnish) pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus and prior to the termination of the offering of any of the securities covered under this prospectus shall be deemed to be incorporated by reference into this prospectus and will automatically update and supersede the information in this prospectus, the applicable prospectus supplement and any previously filed documents.
Unless the context indicates otherwise, references in this prospectus.prospectus to “Exicure,” “the Company,” “we,” “us,” “our” and similar references refer to Exicure, Inc. and its wholly owned subsidiary.
Company Overview
We are a clinical-stage biotechnology company developing therapeutics for immuno-oncology, inflammatory diseasesgenetic disorders and genetic disordersother indications based on our proprietary Spherical Nucleic Acid, or SNA, technology. SNAs are nanoscale constructs consisting of densely packed synthetic nucleic acid sequences that are radially arranged in three dimensions. We believe the design of our SNAs gives rise to distinct chemical and biological properties that may provide advantages over other nucleic acid therapeutics and enable therapeutic activity outside of the liver. SinceWe are working to advance our SNAs have shownSNA therapeutic candidate cavrotolimod (AST-008) in a Phase 1 clinical trial and in preclinical studies that they can cross certain biological barriers when administered locally, we believe that they have the therapeutic potential to target diseases not typically addressed with other nucleic acid therapeutics. We have demonstrated the ability to cross certain biological barriers in Phase 1 clinical trials of three therapeutic candidates, AST-008, XCUR17 and AST-005.
We believe that one of the key strengths of our proprietary SNAs is that they have the potential to enter a number of different cells and organs. We have shown in clinical and preclinical studies that SNAs may have therapeutic potential in immuno-oncology and dermatology. In addition, we have shown in preclinical studies that SNAs may have therapeutic potential in neurology, ophthalmology, pulmonology, and gastroenterology. As a consequence, we are also conductinghave expanded our pipeline into neurology, and have conducted early stage research activities in ophthalmology, pulmonology, and gastroenterology.
Our Strategy
The table below sets forth the stagecurrent status of development of our SNA therapeutic candidates as of March 5, 2019:candidates:
Corporate Information
We were originally incorporated in the State of Delaware on February 6, 2017 under the name “Max-1 Acquisition Corporation.” Prior to the Merger (as defined below), Max-1 was a “shell” company registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, with no specific business plan or purpose until it began operating the business of Exicure Operating Company, (Exicure OpCo)or Exicure OpCo, through a transaction on September 26, 2017, (the “Merger”).or the Merger. Exicure OpCo was originally formed as a limited liability company under the name AuraSense Therapeutics, LLC in the State of Delaware in June 2011 and was a clinical-stage biotechnology company developing gene regulatory and immuno-oncology therapeutics based on its proprietary SNA technology. AuraSense Therapeutics, LLC was subsequently converted into AuraSense Therapeutics, Inc., a Delaware corporation, on July 9, 2015, and changed its name on the same date to Exicure, Inc.
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Immediately after giving effect to the Merger and the initial closing of thea private placement transaction on September 26, 2017, Private Placement, the business of Exicure OpCo became our business.
Our corporate headquarters are located at 8045 Lamon Avenue, Suite 410, Skokie, IL 60077,2430 N. Halsted St., Chicago, Illinois 60614, and our telephone number is (847) 673-1700. We maintain aOur website at www.exicuretx.com, to which we regularly post copies of our press releases as well as additionalis www.exicuretx.com. The information about us. Our filings with the SEC will be available free of charge through the website as soon as reasonably practicable after being electronically filed with or furnished to the SEC. Information contained inon our website is not a part of, nor incorporated by reference into this prospectus, or our other
Risks Associated with our Business
Our business is subject to numerous risks, as described under the discussion of the material risks of investing in our securitiesheading “Risk Factors” contained in our filings with the SEC, as well asherein, and under similar headings in the applicable prospectus supplement, in evaluating us and our business and prospects before you decide to purchase any of our securities. You should also be awaredocuments that this document and other public statements we make may contain statements that do not relate strictly to historical fact, any of which may be forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, and should take into account the considerations relating to such statements discussed under “Risk Factors” or any similar heading in the applicable prospectus supplement and in our filings we make with the SEC including (i) our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, which is on file with the SEC and is incorporated herein by reference and (ii) other documents we file with the SEC that are deemed incorporated by reference into this prospectus. AnyIn particular, our risks include, but are not limited to, the following:
•We are a clinical-stage biotechnology company with a history of losses. We expect to continue to incur significant losses for the risksforeseeable future and uncertainties set forth thereinmay never achieve or maintain profitability, which could result in a decline in the market value of our common stock;
•Our approach to the discovery and development of innovative therapeutic treatments based on our technology is unproven and may not result in marketable products;
•Our therapeutic candidates are in early stages of development and may fail in development or suffer delays that materially and adversely affect our business,their commercial viability;
•Product development involves a lengthy and expensive process with an uncertain outcome, and results of operations, cash flow and financial condition, which in turn could materially and adversely affect the trading price or value of our securities. As a result, you could lose all or part of your investment.
•We will need substantial additional funds to advance the development of our therapeutic candidates, and we cannot guarantee that we will have sufficient funds available in the future to develop and commercialize our current or future therapeutic candidates;
•Our business could be adversely affected by the effects of health epidemics, including the global COVID‑19 coronavirus ("COVID-19") pandemic, in regions where we or third parties on which we rely have business operations and at our clinical trial sites, as well as the business or operations of our CROs or other third parties with whom we conduct business;
•If we continue to experience delays or difficulties in the enrollment of patients in clinical trials, our receipt of necessary regulatory approvals could be further delayed or prevented;
•Our quarterly operating results may fluctuate significantly or may fall below the expectations of investors or securities analysts, each of which may cause our stock price to fluctuate or decline;
•We may not successfully engage in strategic transactions, including any additional collaborations we seek, which could adversely affect our ability to develop and commercialize product candidates, impact our cash position, increase our expense and present significant distractions to our management;
•If third parties on which we depend to conduct our preclinical studies and clinical trials do not perform as contractually required, fail to satisfy regulatory or legal requirements, or miss expected deadlines, our development program could be delayed with materially adverse effects on our business, financial condition, results of operations and prospects;
•Because we rely on third-party manufacturing and supply partners, our supply of research and development, preclinical studies and clinical trial materials may become limited or interrupted or may not be of satisfactory quantity or quality;
•We face competition from entities that have developed or may develop therapeutic candidates for our target disease indications, including companies developing novel treatments and technology platforms based on modalities and technology similar to ours. If these companies develop technologies, including delivery technologies, or therapeutic candidates more rapidly than we do or their technologies are more effective, our ability to develop and successfully commercialize therapeutic candidates may be adversely affected;
•The market may not be receptive to our therapeutic candidates based on a novel therapeutic modality, and we may not generate any future revenue from the sale or licensing of therapeutic candidates;
•Any inability to attract and retain qualified key management and technical personnel would impair our ability to implement our business plan;
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•We will continue to increase the size of our organization, and we may experience difficulties in managing growth;
•We currently license patent rights from Northwestern University and may in the future license patent rights from third-party owners or licensees. If Northwestern University or such other owners or licensees do not properly or successfully obtain, maintain or enforce the patents underlying such licenses, or if they retain or license to others any competing rights, our competitive position and business prospects may be adversely affected; and
•Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.
Implications of Being an Emerging Growth Company and a Smaller Reporting Company
We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of relief from some of the reporting requirements and other burdens that are otherwise applicable generally to public companies. These provisions include:
•being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations” disclosure;
•not being required to comply with the remainderauditor attestation requirements in the assessment of our internal control over financial reporting;
•not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements;
•reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and
•not being required to hold a nonbinding advisory vote on executive compensation and stockholder approval of any net proceeds from sales of securities being used for continued technology platform development, working capital and general corporate purposes. golden parachute payments not previously approved.
We may set forth additional information concerning our expected usetake advantage of net proceeds from salessome or all of securitiesthese reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth company until December 31, 2023 or, if earlier, (1) the last day of the fiscal year in which we have total annual gross revenue of at least $1.07 billion or in which we are deemed to be a large accelerated filer, which means the applicable prospectus supplement relating to the specific offering. Pending usemarket value of net proceeds as described above, we may invest net proceeds in interest-bearing, investment-grade securities.
In addition, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to pay any cash dividends on our common stock for the foreseeable future. Any future determination relatedprivate companies. We have irrevocably elected not to our dividend policyavail ourselves of this exemption from new or revised accounting standards and, therefore, we will be made atsubject to the discretionsame new or revised accounting standards as other public companies that are not emerging growth companies.
We are also a “smaller reporting company” as defined in Rule 12b-2 promulgated under the Exchange Act. We may remain a smaller reporting company until we have a non-affiliate public float in excess of our board$250 million and annual revenues in excess of directors$100 million, or a non-affiliate public float in lightexcess of conditions then-existing, including factors such$700 million, each as our resultsdetermined on an annual basis. Even after we no longer qualify as an emerging growth company, we may still qualify as a smaller reporting company, which would allow us to take advantage of operations, financial condition and requirements, business conditions and covenants under any applicable contractual arrangements.
many of the same exemptions from disclosure requirements.
We may offer shares of our common orstock and preferred stock, various series of senior or subordinated debt securities depositary shares,and warrants other rights to purchase any of such securities, or units consistingup to a total aggregate offering price of combinations of the foregoing, in each case$150,000,000 from time to time in one or more offerings under this prospectus, together with theany applicable prospectus supplement and any related free writing prospectus, at prices and on terms to be determined by market conditions at the time of the relevant offering. This prospectus provides you with a general description of the securities we may offer. At theEach time we offer a particular type or series of securities under this prospectus, we will
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provide an applicablea prospectus supplement describingthat will describe the specific amounts, prices and other important terms of the securities, including, to the extent applicable:
•designation or classification;
•aggregate principal amount or aggregate offering price;
•original issue discount;
•rates and times of payment of interest dividends or other payments;dividends;
•redemption, conversion, exercise, exchange settlement or sinking fund terms, includingterms;
•ranking;
•restrictive covenants;
•voting or other rights;
•conversion or exchange prices or rates and any provisions for changes to or adjustments in suchthe conversion or exchange prices or rates and in the securities or other property receivable upon conversion exercise, exchange or settlement;exchange; and
•important U.S. federal income tax considerations.
We may sell the securities directly to investors or through underwriters, dealers or agents. We, and our underwriters dealers or agents, reserve the right to accept or reject all or part of any proposed purchase of securities. If we do offer securities through underwriters or agents, we will include in the applicable prospectus supplement (i) supplement:
•the names of thethose underwriters or agents and agents;
•applicable fees, discounts and commissions to be paid to them; (ii)
•details regarding over-allotment options, if any; and (iii)
•the estimated net proceeds to us.
Common Stock. We may offer hereunder; they are summarized from, and qualified by reference to, our amended and restated certificate of incorporation, bylaws and the other documents referred to in the descriptions, all of which are or will be publicly filed with the SEC, as applicable. See “Where You Can Find More Information.”
Preferred Stock. We may issue shares of the General Corporation Law of the State of Delaware (the “DGCL”) andour preferred stock from time to time, in one or more series. Under our certificate of incorporation, our board of directors has the authority, without further action by our stockholders (unless such stockholder action is required by applicable law or the rules of any stock exchange or market on which our securities are then traded), to provide for the issue of any or all of the unissued and bylawsundesignated shares of preferred stock in one or more series and to fix the number, rights, preferences, privileges and restrictions thereof. These rights, preferences and privileges could include voting powers, full or limited, or no voting powers, and such designation, preferences and relative, participating, optional, or other rights and such qualifications, limitations or restrictions thereof as shall be stated and expressed in effectthe resolution or resolutions adopted by our board of directors providing for the issuance of such shares and as may be permitted by the DGCL.
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If we sell any series of preferred stock under this prospectus, we will fix the designations, voting powers, preferences and rights of such series of preferred stock, as well as the qualifications, limitations or restrictions thereof, in the certificate of designation relating to that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of any certificate of designation that describes the terms of the series of preferred stock that we are offering before the issuance of the related series of preferred stock. In this prospectus, we have summarized certain general features of the preferred stock under the heading “Description of Capital Stock—Preferred Stock.” We urge you, however, to read the applicable prospectus supplement (and any free writing prospectus that we may authorize to be provided to you) related to the series of preferred stock being offered, as well as the complete certificate of designation that contains the terms of the applicable series of preferred stock.
Debt Securities. From time to time, we may issue debt securities in one or more series, as either senior or subordinated debt or as senior or subordinated convertible debt. The senior debt securities will rank equally with any other unsecured and unsubordinated debt. The subordinated debt securities will be subordinate and junior in right of payment, to the extent and in the manner described in the instrument governing the debt, to all of our senior indebtedness. Convertible debt securities will be convertible into or exchangeable for our common stock or other securities. Conversion may be mandatory or at the timeholder’s option and would be at prescribed conversion rates.
Any debt securities issued under this prospectus will be issued under one or more documents called indentures, which are contracts between us and a national banking association or other eligible party, as trustee. In this prospectus, we have summarized certain general features of the debt securities under the heading “Description of Debt Securities.” We urge you, however, to read the applicable prospectus supplement (and any offering. Copiesfree writing prospectus that we may authorize to be provided to you) related to the series of our Amendeddebt securities being offered, as well as the complete indenture(s) and Restated Certificateany supplemental indentures that contain the terms of Incorporation,the debt securities. We have filed a form of indenture as amended, and our Amended and Restated Bylaws are includedan exhibit to the registration statement of which this prospectus is a part. We will file as exhibits to the registration statement of which this prospectus is a part, or will be incorporated by reference from reports that we file with the SEC, supplemental indentures and forms a part.of debt securities containing the terms of the debt securities being offered.
Warrants.We have authorized capital stock consisting of 200,000,000 sharesmay issue warrants for the purchase of common stock, and 10,000,000 shares of preferred stock. As of March 5, 2019, we had 44,358,000 shares ofstock or debt securities, in one or more series, from time to time. We may issue warrants independently or in combination with common stock, issued and outstanding, and no shares of preferred stock issuedor debt securities. In this prospectus, we have summarized certain general features of the warrants under the heading “Description of Warrants.” We urge you, however, to read the applicable prospectus supplement (and any free writing prospectus that we may authorize to be provided to you) related to the particular series of warrants being offered, as well as the complete warrant agreements and outstanding. Unless stated otherwise, the following discussion summarizeswarrant certificates that contain the terms of the warrants. We have filed forms of the warrant agreements and forms of warrant certificates containing the terms of the warrants that we may offer as exhibits to the registration statement of which this prospectus is a part. We will file as exhibits to the registration statement of which this prospectus is a part, or will be incorporated by reference from reports that we file with the SEC, the form of warrant or the warrant agreement and warrant certificate, as applicable, that contain the terms of the particular series of warrants we are offering, and any supplemental agreements, before the issuance of such warrants.
Any warrants issued under this prospectus may be evidenced by warrant certificates. Warrants may be issued under a warrant agreement that we enter into with a warrant agent. We will indicate the name and address of the warrant agent, if applicable, in the prospectus supplement relating to the particular series of warrants being offered.
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RISK FACTORS
Investing in our securities involves a high degree of risk. You should carefully review the risks and uncertainties described under the heading “Risk Factors” contained in the applicable prospectus supplement and any related free writing prospectus, and under similar headings in our Annual Report on Form 10-K for the year ended December 31, 2019 and in our most recent Quarterly Report on Form 10-Q, as updated by our subsequent filings, which are incorporated by reference into this prospectus, before deciding whether to purchase any of the securities being registered pursuant to the registration statement of which this prospectus is a part. Each of the risk factors described in the documents referenced above could adversely affect our business, operating results, financial condition and cash flows, as well as adversely affect the value of an investment in our securities, and the occurrence of any of these risks might cause you to lose all or part of your investment. Additional risks not presently known to us or that we currently believe are immaterial may also significantly impair our business operations.
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference contain forward-looking statements. These are based on our management’s current beliefs, expectations and assumptions about future events, conditions and results and on information currently available to us. Discussions containing these forward-looking statements may be found, among other places, in the sections titled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K as well as any amendments thereto, filed with the SEC.
Any statements in this prospectus, or incorporated herein, about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. Within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, these forward-looking statements include statements regarding:
•our expectations regarding the impact of the ongoing COVID-19 pandemic including the expected duration of disruption and immediate and long-term delays, interruptions or other adverse effects to clinical trials, patient enrollment and clinical activation, delays in regulatory review, preclinical research and development, or R&D, collaboration and partnership programs, manufacturing and supply chain interruptions, adverse effects on healthcare systems and disruption of the global economy overall, and the overall impact of the COVID-19 pandemic on our business, financial condition and results of operations;
•our estimates of expenses, ongoing losses, future revenue and capital requirements, including our expectations relating to our needs for additional financing;
•the initiation, timing, progress and results of our current and future preclinical studies, clinical trials, collaboration and partnership programs, including our ongoing clinical trials and any planned clinical trials for cavrotolimod (AST-008) or any of our product candidates, and the research and development programs we pursue;
•our ability to advance our product candidates into, and successfully complete, clinical trials;
•the timing and likelihood of regulatory filings for our current and future product candidates including any Investigational New Drug, or IND, application, Investigational Medicinal Product Dossier, or IMPD, Clinical Trial Application, or CTA, New Drug Application, or NDA, or other regulatory submissions;
•our ability to obtain and maintain regulatory approval of our product candidates in the indications for which we plan to develop them, and any related restrictions, limitations or warnings in the label of an approved drug or therapy;
•the size and growth potential of the markets for our product candidates, if approved, and the rate and degree of market acceptance of our product candidates, including reimbursement that may be received from payors;
•the diversion of healthcare resources away from the conduct of clinical trials as a result of the ongoing COVID-19 pandemic, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;
•the interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel, quarantines or social distancing protocols imposed or recommended by federal or state governments, employers and others or voluntarily adopted in connection with the ongoing COVID-19 pandemic;
•our dependence on current and future collaborators for advancement of therapeutic candidates pursuant to the terms of such collaborations, including ability to obtain and maintain regulatory approval and commercialization, if approved;
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•the status of clinical trials, development timelines and discussions with regulatory authorities related to product candidates under development by us and our collaborators;
•our receipt and timing of any milestone payments or royalties under any current or future research collaboration and license agreements or arrangements;
•our ability to identify and develop therapeutic candidates for treatment of additional disease indications;
•the rate and degree of market acceptance of any approved therapeutic candidates;
•the commercialization of any approved therapeutic candidates;
•the implementation of our business model and strategic plans for our business, technologies and therapeutic candidates;
•our ability to obtain additional funds for our operations;
•our ability to obtain and maintain intellectual property protection for our technologies and therapeutic candidates and our ability to operate our business without infringing the intellectual property rights of others;
•our reliance on third parties to conduct our preclinical studies and clinical trials;
•our reliance on third party supply and manufacturing partners to supply the materials and components for, and manufacture, our research and development, preclinical and clinical trial supplies;
•our expectations regarding our ability to attract and retain qualified key management and technical personnel;
•our expectations regarding the time during which we will be an emerging growth company under the JOBS Act;
•statements regarding our internal controls;
•the impact of government laws and regulations as well as developments relating to our competitors or our industry; and
•other factors that may impact our financial results.
You should refer to the “Risk Factors” section contained in this prospectus and any related free writing prospectus, and under similar headings in the other documents that are incorporated by reference into this prospectus, for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Given these risks, uncertainties and other factors, many of which are beyond our control, we cannot assure you that the forward-looking statements in this prospectus will prove to be accurate, and you should not place undue reliance on these forward-looking statements. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all.
Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to revise any forward-looking statements to reflect events or developments occurring after the date of this prospectus, even if new information becomes available in the future.
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USE OF PROCEEDS
We expect to retain broad discretion over the use of the net proceeds from the sale of the securities offered hereby. Except as described in any applicable prospectus supplement or in any free writing prospectuses that we may authorize for use in connection with a specific offering, we currently intend to use the net proceeds from the sale of the securities offered hereby, if any, to advance the development of our product candidates, fund research and development, acquire or invest in businesses, products or technologies that are complementary to our own, although we have no current plans, commitments or agreements with respect to any acquisitions as of the date of this prospectus, as well as for additional business development activities and working capital and other general corporate purposes. We will set forth in the applicable prospectus supplement or free writing prospectus our intended use for the net proceeds received from the sale of any securities sold pursuant to the prospectus supplement or free writing
prospectus. Pending the use of net proceeds, we intend to invest the net proceeds in short-term, investment-grade, interest-bearing obligations, certificates of deposit or direct or guaranteed obligations of the United States.
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DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock and provisions of our amended and restated certificate of incorporation and amended and restated bylaws are summaries. You should also refer to the amended and restated certificate of incorporation and the amended and restated bylaws, which are filed as exhibits to the registration statement of which this prospectus is part.
General
Under our amended and restated bylaws, eachcertificate of incorporation we are authorized to issue up to 200,000,000 shares of common stock, par value $0.0001 per share, and 10,000,000 shares of preferred stock, par value $0.0001 per share, all of which has been publicly filed with the SEC.
Common Stock
Voting Rights
Each holder of common stock areis entitled to one vote perfor each share on all matters to be voted upon by our stockholdersstockholders. The holders of our common stock do not have any cumulative voting rights. The affirmative vote of the holders of at least two-thirds percent (66 2/3%) of the voting power of all of the then-outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class, will be required to amend or repeal our amended and there are no cumulative rights. restated bylaws and to amend certain provisions of our amended and restated certificate of incorporation, including provisions relating to the classified board, the size of our board, removal of directors, director liability, vacancies on our board, special meetings, stockholder notices, actions by written consent and exclusive jurisdiction.
Dividends
Subject to preferences that may be applicable to any outstanding preferred stock, the holders of shares of our common stock are entitled to receive ratably any dividends that may be declared from time to time by our board of directors out of funds legally available for that purpose.
Liquidation
In the event of our liquidation, dissolution or winding up, the holders of shares of our common stock are entitled to share ratably in all assets remaining after payment of liabilities, subject to prior distribution rights of preferred stock then outstanding. Our
Rights and Preferences
Holders of our common stock hashave no preemptive or conversion rights or other subscription rights. Thererights, and there are no redemption or sinking fund provisions applicable to our common stock. The outstanding sharesrights, preferences and privileges of the holders of our common stock are fully paidsubject to and non-assessable, and anymay be adversely affected by the rights of the holders of shares of our common stock to be issued upon an offering pursuant to this prospectus will be fully paid and nonassessable upon issuance.
Our board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions granted to or imposed upon the preferred stock. Any or all of these rights may be greater than the rights of our common stock. Our board of directors may specify the following characteristics of any preferred stock:
•the maximum number of shares;
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•the designation of the shares;
•the annual dividend rate, if any, whether the dividend rate is fixed or variable, the date or dates on which dividends will accrue, the dividend payment dates, and whether dividends will be cumulative;
•the price and the terms and conditions for redemption, if any, including redemption at our option or at the option of the holders, including the time period for redemption, and any accumulated dividends or premiums;
•the liquidation preference, if any, and any accumulated dividends upon the liquidation, dissolution or winding up of our affairs;
•any sinking fund or similar provision, and, if so, the terms and provisions relating to the purpose and operation of the fund;
•the terms and conditions, if any, for conversion or exchange of shares of any other class or classes of our capital stock or any series of any other class or classes, or of any other series of the same class, or any other securities or assets, including the price or the rate of conversion or exchange and the method, if any, of adjustment;
•the voting rights; and
•any or all other preferences and relative, participating, optional or other special rights, privileges or qualifications, limitations or restrictions.
Our board of directors, without stockholder approval, can issue preferred stock with voting, conversion or other rights that could negatively affect the voting power and other rights of the holders of our common stock. Preferred stock could thus be issued quickly with terms calculated to delay or prevent a change in control of us or make it more difficult to remove our management. Additionally,
The Delaware General Corporation Law, or DGCL, which is the issuancelaw of the state of our incorporation, provides that the holders of preferred stock maywill have the effectright to vote separately as a class (or, in some cases, as a series) on an amendment to our certificate of decreasingincorporation if the market priceamendment would change the par value, the powers, preferences or special rights of the class or series so as to adversely affect the class or series, as the case may be, or, unless the certificate of incorporation provided otherwise, the number of authorized shares of the class. This right is in addition to any voting rights that may be provided for in the applicable certificate of designation.
Registration Rights
In connection with the merger completed on September 26, 2017 pursuant to an Agreement and Plan of Merger and Reorganization among Max-1, Max-1 Acquisition Sub, Inc., and Exicure OpCo, or the Merger Agreement, and the private placement offering of our common stock.
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the shares required to be registered by us have been transferred other than to certain enumerated permitted assignees under the registration rights agreement.
On August 22, 2018 as part of a private placement transaction, we entered into subscription agreements with several accredited investors, pursuant to which we agreed to issue and sell a total of 4,889,217 shares of our common stock, at a purchase price of $4.50 per share, resulting in approximately $22 million in gross proceeds to the Company. In connection with such private placement transaction, we entered into a registration rights agreement with the investors in the private placement, which requires us to file a “resale” registration statement with the SEC covering the shares of common stock issued in the private placement within 30 calendar days from the final closing of the private placement. On September 21, 2018, pursuant to the registration rights agreement, we filed a registration statement with the SEC on Form S-1, which was declared effective by the SEC on October 5, 2018, to register for resale by the selling stockholders named in that certain preliminary prospectus dated June 8, 2020 up to 5,034,683 shares of our common stock. The registration rights agreement further requires that we keep the registration statement of which such prospectus forms a part effective for three years from October 5, 2018 or until the date on which all of the shares required to be registered by us have been transferred other than to certain enumerated permitted assignees under the registration rights agreement.
Anti-Takeover Provisions
Section 203 of the Delaware General Corporation Law
We are subject to Section 203 of the DGCL, which prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years andafter the date that such stockholder became an exercise price of $3.00 per share.interested stockholder, with the following exceptions:
•on or after such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.
In general, Section 203 defines a “business combination” to include the following:
•any merger or consolidation involving the corporation and the interested stockholder;
•any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder;
•subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of incentive awardsany stock of upthe corporation to 5,842,525 sharesthe interested stockholder;
•any transaction involving the corporation that has the effect of Exicure commonincreasing the proportionate share of the stock which includes 2,169,905 sharesor any class or series of Exicure commonthe corporation beneficially owned by the interested stockholder; or
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•the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits by or through the corporation.
In general, Section 203 defines an “interested stockholder” as an entity or person who, together with the entity or person’s affiliates and associates, beneficially owns, or is an affiliate or associate of the corporation and within three years prior to the time of determination of interested stockholder status did own, 15% or more of the outstanding voting stock to be issued to officers, employees, consultantsof the corporation.
Amended and directors, plusRestated Certificate of Incorporation and Amended and Restated Bylaws
Our amended and restated certificate of incorporation and amended and restated bylaws include a number of shares notprovisions that may have the effect of delaying, deferring or preventing another party from acquiring control of us and encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to exceed 3,683,817 thatnegotiate with our board of directors rather than pursue non-negotiated takeover attempts. The combination of these provisions will make it more difficult for our existing stockholders to replace our board of directors as well as for another party to obtain control of us by replacing our board of directors.
These provisions are subjectintended to issued and outstanding awards underenhance the Exicure OpCo 2015 Equity Incentive Plan and were assumedlikelihood of continued stability in the Merger. composition of our board of directors and its policies and to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to reduce our vulnerability to hostile takeovers and to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers for our shares and may have the effect of delaying changes in our control or management. As a consequence, these provisions may also inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover attempts. We believe that the benefits of these provisions, including increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure our company, outweigh the disadvantages of discouraging takeover proposals, because negotiation of takeover proposals could result in an improvement of their terms.
These provisions include the following items described below.
Board composition and filling vacancies
Our amended and restated certificate of incorporation provides for our board of directors to be divided into three classes serving staggered terms. Approximately one-third of the board of directors will be elected each year. The provision for a classified board could prevent a party who acquires control of a majority of our outstanding voting stock from obtaining control of our board of directors until the second annual stockholders meeting following the date the acquirer obtains the controlling stock interest. The classified board provision could discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us and could increase the
likelihood that incumbent directors will retain their positions. Our amended and restated certificate of incorporation provides that directors may be removed only for cause by the affirmative vote of the holders of at least 66 and 2/3%two-thirds of the voting power of all of our outstanding stock. The classification of directors, together with the limitations on removal of directors, has the effect of making it more difficult for stockholders to change the composition of our board of directors.
No written consent of stockholders
Our amended and restated certificate of incorporation provides that certain amendmentsand amended and restated bylaws do not allow our stockholders to act by written consent without a meeting. Without the availability of stockholder action by written consent, a holder controlling a majority of our certificate of incorporation and amendments by our stockholders ofcapital stock would not be able to amend our amended and restated bylaws requireor remove directors without holding a stockholders’ meeting. This limit may lengthen the approvalamount of at least 66time required to take stockholder actions and 2/3% ofwould prevent the voting power of allamendment of our outstanding stock. These provisions could discouragebylaws or removal of directors by our stockholders without holding a potential acquirer from making a tender offer or otherwise attempting to obtain controlmeeting of our company and could delay changes in management.stockholders.
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Exclusive forum
Our amended and restated certificate of incorporation also provides that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any of the following types of actions or proceedings under Delaware statutory or common law: derivative action or proceeding brought on our behalf, any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees or agents to us or our stockholders, any action asserting a claim arising pursuant to any provision of the DGCL, our amended and restated certificate of incorporation or our amended and restated bylaws or any action asserting a claim that is governed by the internal affairs doctrine, in each case subject to the Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein andThis provision would not apply to suits brought to enforce a duty or liability created by the claim not being oneSecurities Exchange Act of 1934, as amended, or any other claims for which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery has exclusive jurisdiction or for which the Court of Chancery does not have subject matter jurisdiction. Furthermore, Section 22 of the Securities Act of 1933, as amended (“Securities Act”) creates concurrent jurisdiction for federal and state courts over all Securities Act actions. Accordingly, both state and federal courts have jurisdiction to entertain such claims. Our amended and restated certificate of incorporation also provides that any person purchasing or otherwise acquiring any interest in any shares of our common stock shall be deemed to have notice of and to have consented to this provision of our amended and restated certificate of incorporation. This choice of forum selection provision may limit our stockholders’ ability to bring a claim in a judicial forum that they findit finds favorable for disputes with us or our directors, officers, employees or agents, which may discourage such lawsuits against us and our directors, officers, employees and agents even though an action, if successful, might benefit our stockholders. Stockholders who do bring a claim in the Court of Chancery could face additional litigation costs in pursuing any such claim, particularly if they do not reside in or near Delaware. The Court of Chancery may also reach different judgments or results than would other courts, including courts where a stockholder considering an action may be located or would otherwise choose to bring the action, and such judgments or results may be more favorable to us than to our stockholders. If a court were to find this exclusive forum provision in our amended and restated certificate of incorporation to be inapplicable or unenforceable in any action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could have a material adverse effect on our business, financial condition or results of operations.
Meeting of stockholders
Our amended and restated bylaws provide that a special meeting of our stockholders may be called only by our corporate secretary and at the direction of our board of directors by resolution adopted by a majority of our board of directors. Because our stockholders do not have the right to call a special meeting, a stockholder could not force stockholder consideration of a proposal over the opposition of our board of directors by calling a special meeting of stockholders prior to such time as a majority of our board of directors, the chairperson of our board of directors, the president or the chief executive officer believed the matter should be considered or until the next annual meeting provided that the requestor met the notice requirements. The restriction on the ability of stockholders to call a special meeting means that a proposal to replace our board of directors also could be delayed until the next annual meeting.
Stockholder proposals
Our amended and restated bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors. At an annual meeting, stockholders may only consider proposals specified in the notice of meeting or brought before the meeting by or at the direction of our board of directors. Additionally, at an annual meeting, stockholders may only consider nominations brought before the meeting by or at the direction of our board of directors. Stockholders may also consider a proposal or nomination by a person who was a stockholder at the time of giving notice and at the time of the meeting, who is entitled to vote at the meeting and who has complied with the notice requirements of our amended and restated bylaws in all respects. The amended and restated bylaws do not give our board of directors the power to approve or disapprove stockholder nominations of candidates or proposals regarding other business to be conducted at a special or annual meeting of our stockholders. However, our amended and restated bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper
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procedures are not followed. These provisions may also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.
Advance notice requirements
Our amended and restated bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of our stockholders. These procedures provide that anotice of stockholder proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for the preceding year. Our bylaws specify the requirements as to form and content of all stockholders’ notices. These requirements may preclude stockholders from bringing matters before the stockholders at an annual or special meetingmeeting.
Amendment to our charter documents
Any amendment of our stockholders mayamended and restated certificate of incorporation must first be called only by our Secretary and at the direction of our board of directors by resolution adoptedapproved by a majority of our board of directors. Becausedirectors, and if required by law or our stockholders do not have the right to call a special meeting, a stockholder could not force stockholder considerationamended and restated certificate of a proposal over the opposition of our board of directorsincorporation, must thereafter be approved by calling a special meeting of stockholders prior to such time as a majority of the outstanding shares entitled to vote on the amendment and a majority of the outstanding shares of each class entitled to vote thereon as a class, except that the amendment of the provisions relating to stockholder action, board composition, limitation of liability, exclusive-forum and requirements for amendment of our boardamended and restated certificate of incorporation must be approved by the affirmative vote of the holders of at least two-thirds of the voting power of all of the then-outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class. Our amended and restated bylaws may be amended by the chairpersonaffirmative vote of a majority of the authorized directors, subject to any limitations set forth in our amended and restated bylaws; and may also be amended by the affirmative vote of a majority of the outstanding shares entitled to vote on the amendment, voting together as a single class; provided that, in addition to any vote of the holders of any class or series of our boardstock required by law or by our amended and restated certificate of directors,incorporation, such action by stockholders shall require the presidentaffirmative vote of the holders of at least two-thirds of the voting power of all of the then-outstanding shares of our capital stock entitled to vote at an election of directors. These provisions could discourage a potential acquirer from making a tender offer or the chief executive officer believed the matter should be considered or until the next annual meeting provided that the requestor met the notice requirements. The restriction on the abilityotherwise attempting to obtain control of stockholders to call a special meeting means that a proposal to replace our board of directors alsocompany and could be delayed until the next annual meeting.delay changes in management.
Undesignated preferred stock
Our amended and restated certificate of incorporation and amended and restated bylaws do not allow our stockholders to act by written consent without a meeting. Without the availabilityprovides for 10,000,000 authorized shares of stockholder action by written consent, a holder controlling a majoritypreferred stock. The existence of our capitalauthorized but unissued shares of preferred stock would not be able to amend our amended and restated bylaws or remove directors without holding a stockholders’ meeting.
group. In general, Section 203 defines an interested stockholder as an entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by such entity or person.
us.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC. The transfer agent’s address is 6201 15th Avenue, Brooklyn, New York 11219 and its telephone number is
718-921-8200. The following description, together with the additional information we include intransfer agent for any applicable prospectus supplement, summarizes the material features, terms and provisionsseries of any debt securitiespreferred stock that we may offer under this prospectus. This summary does not purport toprospectus will be exhaustivenamed and may not contain all ofdescribed in the information that is important to you. Therefore, you should read the applicable prospectus supplement relating tofor that series.
Listing on The Nasdaq Global Select Market
Our common stock is listed on Nasdaq under the debt securities and any other offering materials that we may provide. symbol “XCUR.”
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DESCRIPTION OF DEBT SECURITIES
We may issue debt securities from time to time, in one or more series, as either senior or subordinated debt or junioras senior or subordinated convertible or non-convertible and secured or unsecured debt. Any seniorWhile the terms we have summarized below will apply generally to any debt securities will rank equally with any unsubordinated debt. Subordinated debt securities will rank equally with any other subordinated debt of the same rankingthat we may issue. Convertible debt securities will be convertible into or exchangeable for our common stock or other securities at predetermined conversion rates, and conversion may be mandatory or at the holder’s option.
We will issue the debt securities under either the senior indenture or the subordinated indenture that we describe below. You should readwill enter into with trustee named in the applicable indenture. If we offer senior debt securities, we will issue them under the senior indenture. If we issue subordinated debt securities, we will issue them under the subordinated indenture. We have filed the forms of indentures as an exhibit to the registration statement of which this prospectus supplement, any free writing prospectus we may authorizeis a part, and the indentures, supplemental indentures and forms of debt securities relatingcontaining the terms of the debt securities being offered will be filed as exhibits to the registration statement of which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC. The indentures will be qualified under the Trust Indenture Act of 1939, as amended, or the Trust Indenture Act. Unless the context requires otherwise, whenever we refer to the indenture, we are referring to the senior indenture or the subordinated indenture, as applicable, and we also are referring to any supplemental indentures that specify the terms of a particular series of debt securities.
The following summary of material provisions of the debt securities we may offer.
General
The indenture willdoes not limit the amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal amount that we may authorize and may be in any currency or currency unit that we may designate. Except for the limitations on consolidation, merger and sale of all or substantially all of our assets contained in the indenture, the terms of the indenture do not contain any covenants or other provisions designed to give holders of any debt securities protection against changes in our operations, financial condition or transactions involving us.
We may issue the debt securities issued under the indenture as “discount securities,” which means they may be sold at a discount below their stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be issued thereunder,with “original issue discount,” or OID, for U.S. federal income tax purposes because of interest payment and will provide that the specificother characteristics or terms of any series ofthe debt securities. Material U.S. federal income tax considerations applicable to debt securities shallissued with OID will be set forthdescribed in or determined pursuant to, an authorizing resolution, an officers’ certificate or a supplemental indenture, ifmore detail in any relating to such series.applicable prospectus supplement.
We will describe in eachthe applicable prospectus supplement the following terms relating to anyof the series of debt securities including, to the extent applicable:being offered, including:
•the title of the series of debt securities;
•any limit upon the aggregate principal amount that may be issued;
•the maturity date or designation;dates;
•the form of the debt securities of the series;
•the applicability of any guarantees;
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•whether or not the debt securities will be secured or unsecured, and the terms of any security;secured debt;
•whether the debt securities will be subject to subordination,rank as senior debt, senior subordinated debt, subordinated debt or any combination thereof, and the terms of any terms thereof;subordination;
•the interest rate or rates, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the date or dates interest will be payable and the regular record dates for interest payment dates or the method for determining them;such dates;
•if applicable, the date or conversion,dates after which, or the period or periods during which, and where notices and demands tothe price or upon the Company in respect of the debt securities may be made;
•the date or at the option of a holder;
•the denominations in which we will be issued,issue the series of debt securities, if other than denominations of $1,000 and any integral multiple thereof;
•whether the debt securities are to be issued at any original issuance discount andof the amount of discount with which the debt securities may be issued;
•if applicable, the provisions relating to conversion or exchange of any debt securities represented thereby;
series and the terms and conditions upon which convertiblesuch debt securities will be so convertible or exchangeable, intoincluding the conversion or exchange price, as applicable, or how it will be calculated and may be adjusted, any mandatory or optional (at our securitiesoption or propertythe holders’ option) conversion or thoseexchange features, the applicable conversion or exchange period and the manner of another person, settlement for any conversion or exchange;
•if at all, and any additions or changes, if any, to permit or facilitateother than the same;
•additions to or changes in the covenants applicable to the termsparticular debt securities being issued, including, among others, the consolidation, merger or sale covenant;
•additions to or changes in the events of default with respect to the securities and any change in the right of the indenture. Wetrustee or the holders to declare the principal, premium, if any, and interest, if any, with respect to such securities to be due and payable;
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•additions to or changes in or deletions of the provisions relating to covenant defeasance and legal defeasance;
•additions to or changes in the provisions relating to satisfaction and discharge of the indenture;
•additions to or changes in the provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture;
•the currency of payment of debt securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars;
•whether interest will provide you with informationbe payable in cash or additional debt securities at our or the holders’ option and the terms and conditions upon which the election may be made;
•the terms and conditions, if any, upon which we will pay amounts in addition to the stated interest, premium, if any and principal amounts of the debt securities of the series to any holder that is not a “United States person” for federal tax purposes;
•any restrictions on transfer, sale or assignment of the debt securities of the series; and
•any other specific terms, preferences, rights or limitations of, or restrictions on, the U.S. federal income tax considerations and other special considerations applicable to any debt securities, any other additions or changes in the provisions of the indenture, and any terms that may be required by us or advisable under applicable prospectus supplement.laws or regulations.
Conversion or Exchange Rights.
We will set forth in the applicable prospectus supplement the terms if any, on which a series of debt securities may be convertible into or exchangeable for our common stock or our other securities. We will include provisions as to settlement upon conversion or exchange and whether conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which the number of shares of our common stock or our other securities that the holders of the series of debt securities receive would be subject to adjustment.
Consolidation, Merger or Sale; No Protection in Event of a Change of Control or Highly Leveraged Transaction. Except asSale
Unless we mayprovide otherwise provide in the applicable prospectus supplement applicable to a particular series of debt securities, the indenture will providenot contain any covenant that we may notrestricts our ability to merge or consolidate, with or into another entity, or sell, other than for cashconvey, transfer or lease allotherwise dispose of our assets as an entirety or substantially all ouras an entirety. However, any successor to or acquirer of such assets to another entity, or purchase all or substantially all the assets(other than a subsidiary of another entity unless we are the surviving entity or, if we are not the surviving entity, the successor, transferee or lessee entity expressly assumesours) must assume all of our obligations under the indenture or the debt securities, as appropriate.
Events of Default under the Indenture
Unless we stateprovide otherwise in the applicable prospectus supplement theapplicable to a particular series of debt securities, will not contain any provisions that may afford holders additional protection in the event we experience a change of control or in the event of a highly-leveraged transaction (whether or not such transaction results in a change of control), which could adversely affect them.
•if we fail to pay any installment of interest on any series of debt securities, as and when the same shall become due and our failurepayable, and such default continues for a period of 90 days anddays; provided, however, that a valid extension of an interest payment period by us in accordance with the timeterms of any indenture supplemental thereto shall not constitute a default in the payment of interest for payment has not been extended or deferred;this purpose;
•if we fail to pay the principal of, or premium, if any, on any series of debt securities as and when due whether by maturity or called for redemption;
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however, that a valid extension of the maturity of such debt securities in accordance with the terms of any indenture supplemental thereto shall not constitute a default in the payment of principal or premium, if any;
•if we fail to observe or perform any other covenant relating toor agreement contained in the debt securities or the indenture, other than a covenant specifically relating to and for the benefit of holders of another series of debt securities, and our failure continues for 90 days after we receive written notice of such failure, requiring the same to be remedied and stating that such is a notice of default thereunder, from the trustee or holders of not less than a majorityat least 25% in aggregate principal amount of the outstanding debt securities of the applicable series; and
•if specified events of bankruptcy, insolvency or reorganization occur as to the Company.occur.
The holders of a majority in principal amount of the outstanding debt securities of an affected series may by a notice in writing to us (and to the trustee if given by the holders), declare to be due and payable immediately the principal (or, if the debt securities are discount securities, that portionwaive any default or event of the principal amount as may be specified in the terms of such securities) of and premium and accrued and unpaid interest, if any, on all such debt securities. Before a judgment or decree for
Subject to the terms of the indenture, and except as we may otherwise provide in a prospectus supplement, if an event of default under thean indenture shall occur and be continuing, the trustee will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable series of debt securities, unless such holders have offered the trustee reasonable indemnity. The holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect to the debt securities of that series, provided that, that:
•the direction so given by the holder is not in conflict with any law or the applicable indenture; and
•subject to its duties under the terms of the indenture,Trust Indenture Act, the trustee need not take any action that it believes, upon the advice of counsel, might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding.
•the holder previously has given written notice to the trustee of a continuing event of default with respect to that series;
•the holders of at least a majority25% in aggregate principal amount of the outstanding debt securities of that series have made written request, and
•such holders have offered reasonable indemnity to the trustee indemnity satisfactory to instituteit against the proceeding as trustee;costs, expenses and liabilities to be incurred by the trustee in compliance with the request; and
•the trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series (or at a meeting of holders at which a quorum is present, the holders of a majority in principal amount of such series represented at such meeting) other conflicting directions within 6090 days after the notice, request and offer.
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We will periodically file statements with the applicable trustee regarding our compliance with specified covenants in the applicable indenture.
Modification of Indenture; Waiver. Except as we may otherwise provide in the applicable prospectus supplement, we
We and the trustee may change an indenture without the consent of any holders of any series, execute a supplemental indenture to change the indenture with respect to specific matters, including, among other things:matters:
•to cure any ambiguity, defect or inconsistency in the indenture or in the debt securities of any series;
•to comply with the provisions described above under “Description of Debt Securities—Consolidation, Merger or Sale;”
•to provide for uncertificated debt securities in addition to or in place of certificated debt securities;
•to add to our covenants, restrictions, conditions or provisions such new covenants, restrictions, conditions or provisions for the benefit of the holders of all or any series of debt securities, to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions or provisions an event of default or to surrender any right or power conferred upon us;us in the indenture;
•to provide, changeadd to, delete from or eliminate anyrevise the conditions, limitations, and restrictions on paymentthe authorized amount, terms, or purposes of principalissue, authentication and delivery of or premium, if any; provideddebt securities, as set forth in the indenture;
•to make any change that any such action shalldoes not adversely affect the interests of the holdersany holder of debt securities of any series in any material respect;
•to change or eliminate anyprovide for the issuance of and establish the form and terms and conditions of the provisionsdebt securities of any series as provided above under “Description of Debt Securities—General” to establish the form of any certifications required to be furnished pursuant to the terms of the indenture; provided thatindenture or any such changeseries of debt securities, or elimination shall become effective only when there is no outstanding debt security created priorto add to the executionrights of such supplemental indenture that is entitled to the benefitholders of such provision and as to which such supplemental indenture would apply;any series of debt securities;
•to evidence and provide for the acceptance of appointment under any indenture by a successor trusteetrustee; or
•to comply with respect to one or more series of debt securities and to add or change provisionsany requirements of the indenture to facilitateSEC in connection with the administration thereof by more than one trustee;
In addition, and except as we may otherwise provide in the applicable prospectus supplement, under the indenture, the rights of holders of a series of debt securities may be changed by us and the trustee with the written consent of the holders of at least a majority in aggregate principal amount of the outstanding (or, at a meetingdebt securities of holders of sucheach series at which a quorum is present, the holders of a majority in principal amount represented at such meeting) that is affected. WeHowever, unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, we and the trustee may however, make the following changes only with the consent of each holder of any outstanding debt securities affected:
•extending the fixed maturity;maturity of any debt securities of any series;
•reducing the principal amount, reducing the rate of or extending the time of payment of interest, or reducing any premium payable upon redemption;
•reducing the percentage of debt securities, the holders of which are required to consent to any amendment, supplement, modification or waiver; or modifying, without the written consent of the trustee, the rights, duties or immunities of the trustee.waiver.
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•provide for payment;
•register the transfer or exchange of debt securities of the series;
•replace stolen, lost or mutilated debt securities of the series;
•pay principal of and premium and interest on any debt securities of the series;
•maintain paying agencies;
•hold monies for payment in trust;
•recover excess money held by the trustee;
•compensate and indemnify the trustee; and
•appoint any successor trustee.
In order to exercise our rights to be discharged, we must deposit with the trustee money or government obligations sufficient to pay all the principal of, theany premium, if any, and interest on, the debt securities of the affected series on the dates payments are due.
Form, Exchange and Transfer. Except as we may otherwise provide in the applicable prospectus supplement, we
We will issue the debt securities of each series only in fully registered form without coupons and, unless we provide otherwise specify in the applicable prospectus supplement, in denominations of $1,000 and any integral multiple thereof. Except as we may otherwise provide in the applicable prospectus supplement, theThe indenture will provideprovides that we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, aor on behalf of, The Depository Trust Company, or DTC, or another depositary named by us and identified in athe applicable prospectus supplement with respect to that series. To the extent the debt securities of a series are issued in global form and as book-entry, a description of terms relating to any book-entry securities will be set forth in the applicable prospectus supplement.
At the option of the holder, subject to the terms of the indenture and the limitations applicable to global securities described in the applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject to the terms of the indenture and the limitations applicable to global securities set forth in the applicable prospectus supplement, holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of the security registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities that the holder presents for transfer or the indenture,exchange, we will makeimpose no service charge for any registration of transfer or exchange, but we may require payment of any taxes or other governmental charges.
We will name in the applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar, that we initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the designation of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for the debt securities of each series.
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•issue, register the transfer of, or exchange any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities that may be selected for redemption and ending at the close of business on the day of the mailing; or
•register the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming in part.
Information Concerning the Trustee.
The trustee, other than during the occurrence and continuance of an event of default under thean indenture, will undertakeundertakes to perform only those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the trustee must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the trustee will beis under no obligation to exercise any of the powers given it by the indenture at the request of any holder of debt securities unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it might incur.
Payment and Paying Agents.
Unless we otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered at the close of business on the regular record date for the interest.
All money we pay to a paying agent or the trustee for the payment of the principal of or any premium or interest whichon any debt securities that remains unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid to us, and the holder of the debt security thereafter may look only to us for payment thereof.
Governing Law.
The indenture and the debt securities will be governed by and construed in accordance with the internal laws of the State of New York, except to the extent that the Trust Indenture Act of 1939 is applicable.
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DESCRIPTION OF WARRANTS
The following description, together with the additional information we may include in any applicable prospectus supplement and in any related free writing prospectus that we may authorize to be distributed to you, summarizes the material terms and provisions of the warrants that we may offer under this prospectus, which may consist of warrants to purchase common stock, preferred stock or debt securities and may be issued in one or more series. Warrants may be offered independently or in combination with common stock, preferred stock or debt securities offered by any prospectus supplement. While the terms we have summarized below will apply generally to any warrants that we may offer under this prospectus, we will describe the particular terms of any series of warrants in more detail in the applicable prospectus supplement. The following description of warrants will apply to the warrants offered by this prospectus unless we provide otherwise in the applicable prospectus supplement. The applicable prospectus supplement for a particular series of warrants may specify different or additional terms.
We have filed forms of the warrant agreements and forms of warrant certificates listing the terms of the warrants that may be offered as exhibits to the registration statement of which this prospectus is a part. We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of warrant or the warrant agreement and warrant certificate, as applicable, that contain the terms of the particular series of warrants we are offering, as well as any supplemental agreements, before the issuance of such warrants. The following summaries of material terms and provisions of the warrants are subject to, and qualified in their entirety by reference to, all the provisions of the form of warrant or the warrant agreement and warrant certificate, as applicable, and any supplemental agreements applicable to a particular series of warrants that we may offer under this prospectus. We urge you to read the applicable prospectus supplement related to the particular series of warrants that we may offer under this prospectus, as well as any related free writing prospectus, and the complete form of warrant or the warrant agreement and warrant certificate, as applicable, and any supplemental agreements, that list the terms of the warrants.
General
In the applicable prospectus supplement, we will describe the terms of the series of warrants being offered, including, to the extent applicable:
•the offering price and aggregate number of warrants offered;
•the currency for which the warrants may be purchased;
•the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal amount of such security;
•in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable on exercise of one warrant and the price at, and currency in which, this principal amount of debt securities may be purchased on such exercise;
•in the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the case may be, purchasable on the exercise of one warrant and the price at which these shares may be purchased on such exercise;
•the effect of any merger, consolidation, sale or other disposition of our business on the warrant agreements and the warrants;
•the terms of any rights to redeem or call the warrants;
•any provisions for changes to or adjustments in the exercise price or number of securities issuable on exercise of the warrants;
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•the dates on which the right to exercise the warrants will commence and expire;
•the manner in which the warrant agreements and warrants may be modified;
•a discussion of material or special U.S. federal income tax considerations of holding or exercising the warrants;
•the terms of the securities issuable on exercise of the warrants; and
•any other specific terms, preferences, rights or limitations of or restrictions on the warrants.
Before exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable on such exercise, including:
•in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or payments on our liquidation, dissolution or winding up or to exercise voting rights, if any; or
•in the case of warrants to purchase debt securities, the right to receive payments of principal of, or premium, if any, or interest on, the debt securities purchasable on exercise or to enforce covenants in the applicable indenture.
Exercise of Warrants
Each warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise price that we describe in the applicable prospectus supplement. The warrants may be exercised as listed in the prospectus supplement relating to the warrants offered. Unless we otherwise specify in the applicable prospectus supplement, warrants may be exercised at any time up to the specified time on the expiration date that we list in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.
On receipt of payment and the warrant or warrant certificate, as applicable, properly completed and duly executed at the corporate trust office of the warrant agent, if any, or any other office, including ours, indicated in the prospectus supplement, we will, as soon as practicable, issue and deliver the securities purchasable on such exercise. If less than all of the warrants (or the warrants represented by such warrant certificate) are exercised, a new warrant or a new warrant certificate, as applicable, will be issued for the remaining warrants.
Governing Law
Unless we provide otherwise in the applicable prospectus supplement, the warrants and warrant agreements will be governed by and construed in accordance with the laws of the State of New York.
Each warrant agent, officer, director or subsidiary of ours will haveif any, liability for any obligations of ours or, due to the creation of any indebtedness under the debt securities, the indentures or supplemental indentures. The indenture will provide that all such liability is expressly waived and released as a condition of, and as consideration for, the execution of such indentures and the issuance of the debt securities.
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LEGAL OWNERSHIP OF SECURITIES
We can issue securities in registered form or in the form of one or more global securities. We describe global securities in greater detail below. We refer to those persons who have securities registered in their own names on the books that we or any applicable trustee or depositary maintain for this purpose as the “holders” of those securities. These persons are the legal holders of the securities. We refer to those persons who, indirectly through others, own beneficial interests in securities that are not registered in their own names, as “indirect holders” of those securities. As we discuss below, indirect holders are not legal holders, and investors in securities issued in book-entry form or beneficial owners of Rights.in street name will be indirect holders.
Book-Entry Holders
We may issue securities in units (“Units”), each consisting of twobook-entry form only, as we will specify in the applicable prospectus supplement. This means securities may be represented by one or more typesglobal securities registered in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate in the depositary’s book-entry system. These participating institutions, which are referred to as participants, in turn, hold beneficial interests in the securities on behalf of themselves or their customers.
Only the person in whose name a security is registered is recognized as the holder of that security. Global securities will be registered in the name of the depositary or its participants. Consequently, for global securities, we will recognize only the depositary as the holder of the securities, and we will make all payments on the securities to the depositary. The depositary passes along the payments it receives to its participants, which in turn pass the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements they have made with one another or with their customers; they are not obligated to do so under the terms of the securities.
As a result, investors in a global security will not own securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that participates in the depositary’s book-entry system or holds an interest through a participant. As long as the securities are issued in global form, investors will be indirect holders, and not legal holders, of the securities.
Street Name Holders
We may terminate a global security or issue securities that are not issued in global form. In these cases, investors may choose to hold their securities in their own names or in “street name.” Securities held by an investor in street name would be registered in the name of a bank, broker or other financial institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account he or she maintains at that institution.
For securities held in street name, we or any applicable trustee or depositary will recognize only the intermediary banks, brokers and other financial institutions in whose names the securities are registered as the holders of those securities, and we or any such trustee or depositary will make all payments on those securities to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in street name will be indirect holders, not holders, of those securities.
Legal Holders
Our obligations, as well as the obligations of any applicable trustee or third party employed by us or a trustee, run only to the legal holders of the securities. We do not have obligations to investors who hold beneficial interests in global securities, in street name or by any other indirect means. This will be the case whether an investor chooses to be an indirect holder of a security or has no choice because we are issuing the securities only in global form.
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For example, once we might issue Units consistingmake a payment or give a notice to the holder, we have no further responsibility for the payment or notice even if that holder is required, under agreements with its participants or customers or by law, to pass it along to the indirect holders but does not do so. Similarly, we may want to obtain the approval of the holders to amend an indenture, to relieve us of the consequences of a combination of sharesdefault or of our common stockobligation to comply with a particular provision of an indenture, or for other purposes. In such an event, we would seek approval only from the holders, and warrantsnot the indirect holders, of the securities. Whether and how the legal holders contact the indirect holders is up to purchase sharesthe legal holders.
Special Considerations for Indirect Holders
If you hold securities through a bank, broker or other financial institution, either in book-entry form because the securities are represented by one or more global securities or in street name, you should check with your own institution to find out:
•how it handles securities payments and notices;
•whether it imposes fees or charges;
•how it would handle a request for the holders’ consent, if ever required;
•whether and how you can instruct it to send you securities registered in your own name so you can be a holder, if that is permitted in the future;
•how it would exercise rights under the securities if there were a default or other event triggering the need for holders to act to protect their interests; and
•if the securities are in book-entry form, how the depositary’s rules and procedures will affect these matters.
Global Securities
A global security is a security that represents one or any other number of our common stock. Ifindividual securities held by a depositary. Generally, all securities represented by the same global securities will have the same terms.
Each security issued in book-entry form will be represented by a global security that we issue Units,to, deposit with and register in the name of a financial institution or its nominee that we select. The financial institution that we select for this purpose is called the depositary. Unless we specify otherwise in the applicable prospectus supplement, The Depository Trust Company, New York, New York, known as DTC, will contain informationbe the depositary for all securities issued in book-entry form.
A global security may not be transferred to or registered in the name of anyone other than the depositary, its nominee or a successor depositary, unless special termination situations arise. We describe those situations below under “—Special Situations When a Global Security Will Be Terminated.” As a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and legal holder of all securities represented by a global security, and investors will be permitted to own only beneficial interests in a global security. Beneficial interests must be held by means of an account with regard to eacha broker, bank or other financial institution that in turn has an account with the depositary or with another institution that does. Thus, an investor whose security is represented by a global security will not be a legal holder of the security, but only an indirect holder of a beneficial interest in the global security.
If the prospectus supplement for a particular security indicates that the security will be issued as a global security, then the security will be represented by a global security at all times unless and until the global security is terminated. If termination occurs, we may issue the securities through another book-entry clearing system or decide that isthe securities may no longer be held through any book-entry clearing system.
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Special Considerations for Global Securities
As an indirect holder, an investor’s rights relating to a componentglobal security will be governed by the account rules of the Units. investor’s financial institution and of the depositary, as well as general laws relating to securities transfers. We do not recognize an indirect holder as a holder of securities and instead deal only with the depositary that holds the global security.
If securities are issued only as global securities, an investor should be aware of the following:
•an investor cannot cause the securities to be registered in his or her name, and cannot obtain non-global certificates for his or her interest in the securities, except in the special situations we describe below;
•an investor will be an indirect holder and must look to his or her own bank or broker for payments on the securities and protection of his or her legal rights relating to the securities, as we describe above;
•an investor may not be able to sell interests in the securities to some insurance companies and to other institutions that are required by law to own their securities in non-book-entry form;
•an investor may not be able to pledge his or her interest in the global security in circumstances where certificates representing the securities must be delivered to the lender or other beneficiary of the pledge in order for the pledge to be effective;
•the depositary’s policies, which may change from time to time, will govern payments, transfers, exchanges and other matters relating to an investor’s interest in the global security;
•we and any applicable trustee have no responsibility for any aspect of the depositary’s actions or for its records of ownership interests in the global security, nor will we or any applicable trustee supervise the depositary in any way;
•the depositary may, and we understand that DTC will, require that those who purchase and sell interests in the global security within its book-entry system use immediately available funds, and your broker or bank may require you to do so as well; and
•financial institutions that participate in the depositary’s book-entry system, and through which an investor holds its interest in the global security, may also have their own policies affecting payments, notices and other matters relating to the securities.
There may be more than one financial intermediary in the chain of ownership for an investor. We do not monitor and are not responsible for the actions of any of those intermediaries.
Special Situations When a Global Security Will Be Terminated
In addition,a few special situations described below, a global security will terminate and interests in it will be exchanged for physical certificates representing those interests. After that exchange, the choice of whether to hold securities directly or in street name will be up to the investor. Investors must consult their own banks or brokers to find out how to have their interests in securities transferred to their own names, so that they will be direct holders. We have described the rights of holders and street name investors above.
Unless we provide otherwise in the applicable prospectus supplement, the global security will describeterminate when the termsfollowing special situations occur:
•if the depositary notifies us that it is unwilling, unable or no longer qualified to continue as depositary for that global security and we do not appoint another institution to act as depositary within 90 days;
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•if we notify any applicable trustee that we wish to terminate that global security; or
•if an event of any Units we issue. The forms of any certificatesdefault has occurred with regard to securities represented by that global security and agreements relating to such Units will be filed as exhibits to the registration statement of which this prospectus forms a part by amendment thereofhas not been cured or as exhibits to a Current Report on Form 8-K incorporated herein by reference.waived.
The applicable prospectus supplement may also list additional situations for terminating a global security that would apply only to the particular series of securities covered by the prospectus supplement. When a global security terminates, the depositary, and such forms may add, update or changeneither we nor any applicable trustee, is responsible for deciding the terms and conditionsnames of the Rights or Units described in this prospectus. You should read the prospectus supplements, Rights agreements and Rights certificatesinstitutions that contain the terms of the Rights in their entirety.
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PLAN OF DISTRIBUTION
We may sell the offered securities in and outsidefrom time to time pursuant to underwritten public offerings, negotiated transactions, block trades or a combination of these methods. We may sell the United States (1)securities to or through underwriters or dealers, (2)through agents, or directly to one or more purchasers, including to a limited number of institutional purchasers, to a single purchaser or to our affiliates and stockholders, (3) through one or more brokers or dealers; (4) through agents or (5) through a combination of any of these methods.
purchasers. We may also sell directly to investors through subscription rights distributed to our stockholders on a pro rata basis. In connection with any distribution of subscription rights to stockholders, if all of the underlyingdistribute securities are not subscribed for, we may sell the unsubscribed shares of our common stock directly to third parties or may engage the services of one or more underwriters, dealers or agents, including standby underwriters, to sell the unsubscribed securities to third parties.
•at market prices prevailing at the time of sale;
•at prices related to time;such prevailing market prices; or
•at negotiated prices.
We may also sell equity securities covered by this registration statement in “at-the-market offerings,” withinan “at the meaning ofmarket offering” as defined in Rule 415(a)(4) ofunder the Securities Act, to or through a market maker orAct. Such offering may be made into an existing trading market for such securities in transactions at other than a fixed price, either:
•on anor through the facilities of Nasdaq or any other securities exchange or otherwise;quotation or trading service on which such securities may be listed, quoted or traded at the time of sale; and/or
Such at the market makerofferings, if any, may be conducted by underwriters acting as principal or into an existing trading market on an exchange or otherwise;agent.
•the terms of the offering;
•the purchase price of the securities;securities and the proceeds we will receive from the sale;
•any over-allotment options under which underwriters may purchase additional securities from us;
•any delayed delivery arrangements;
•any initial public offering price;
•any discounts or concessions allowed or reallowed or paid to dealers; and
•any securities exchangesexchange or marketsmarket on which the securities may be listed.
If any securitiesunderwriters are offered through underwriters,used in the underwriterssale, they will acquire the securities for their own account and may resell themthe securities from time to time in one or more transactions, including negotiated transactions at a fixed public offering price or at varying prices determined at the time of sale. Underwriters may offer and sell securities to the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters. Unless otherwise provided in the applicable prospectus supplement, theThe obligations of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement. We may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Subject to certain conditions, and the underwriters will be obligated to purchase all of the securities offered by the prospectus supplement, other than securities if they purchase any of them. In connection with the sale of securities, underwriters may be deemed to have received compensation from us in the form of underwriting discountscovered by an overallotment or commissions and dealers may receive compensation from the underwriters in the form of discounts or concessions. The underwriters may change from time to time any initialother option. Any public offering price and any
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discounts or concessions allowed or reallowed or paid to dealers.
We may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offer oroffering and sale of the offered securities, and we will describe any commissions payable towe will pay the agent. Unless otherwise providedagent in the applicableprospectus supplement. Unless the prospectus supplement anystates otherwise, our agent will agree to use its reasonable best efforts to solicit purchasesact on a best-efforts basis for the period of its appointment.
We may have agreementsprovide agents and underwriters with the agents, dealers, underwriters and remarketing firmsindemnification against civil liabilities related to indemnify them against certain civil liabilities,this offering, including liabilities under the Securities Act, or to contributecontribution with respect to payments that the agents dealers or underwriters may be requiredmake with respect to make.these liabilities. Agents dealers,and underwriters and remarketing firms may be customers of, engage in transactions with, or perform services for, us in the ordinary course of their businesses.business.
Any underwriter dealermay engage in overallotment, stabilizing transactions, short covering transactions and agent participatingpenalty bids. Overallotment involves sales in excess of the offering size, which create a short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. Short covering transactions involve purchases of the securities in the open market after the distribution is completed to cover short positions. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally sold by the dealer are purchased in a stabilizing or covering transaction to cover short positions. Those activities may cause the price of the securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of the securities thatactivities at any time. These transactions may be effected on any exchange or over-the-counter market or otherwise.
Any underwriters who are issuablequalified market makers on Nasdaq may engage in bearer form will agree that it will not offer, sell or deliver, directly or indirectly, securities in bearer formpassive market making transactions in the United States or to United States persons, other than qualifying financial institutions,securities on Nasdaq in accordance with Rule 103 of Regulation M, during the restricted period,business day prior to the pricing of the offering, before the commencement of offers or sales of the securities. Passive market makers must comply with applicable volume and price limitations and must be identified as definedpassive market makers. In general, a passive market maker must display its bid at a price not in United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7). excess of the highest independent bid for such security; if all independent bids are lowered below the passive market maker’s bid, however, the passive market maker’s bid must then be lowered when certain purchase limits are exceeded. Passive market making may stabilize the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may be discontinued at any time.
LEGAL MATTERS
Unless otherwise indicated in the applicable prospectus supplement, certain legal matters in connection with the offering and the validity of the securities offered by this offeringprospectus, and any supplement thereto, will be passed upon by Cooley LLP. Additional legal matters may be passed upon for us or any underwriters, dealers or agents, by Goodwin Procter LLP, Redwood City, California. Any underwriterscounsel that we will also be advised about the validity of the securities and other legal matters by their own counsel, which will be namedname in the applicable prospectus supplementsupplement.
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EXPERTS
The consolidated financial statements of Exicure, Inc. as of December 31, 20182019 and 2017,2018, and for each of the years in the two-year period ended December 31, 2018,2019, have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing. The audit report covering the December 31, 20182019 consolidated financial statements refers to the adoption of Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 606,842, Revenue from ContractsLeases.
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WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement we filed with Customers. The audit report covering the December 31, 2018 consolidated financial statements contains an explanatory paragraph that states thatSEC. This prospectus does not contain all of the Company has suffered recurring losses from operationsinformation set forth in the registration statement and will be requiredthe exhibits to raise additional capital or alternative means of financial supportthe registration statement. For further information with respect to fund operations, which raise substantial doubt about its abilityus and the securities we are offering under this prospectus, we refer you to continuethe registration statement and the exhibits and schedules filed as a going concern. The consolidated financial statements do not include any adjustments that might result frompart of the outcome of that uncertainty.
registration statement. You should rely only on the information contained in this prospectus or incorporated by reference. We have not authorized anyone else to provide you with different information. We are not making an offer of these securities in any dealer, salespersonstate where the offer is not permitted. You should not assume that the information in this prospectus is accurate as of any date other than the date on the front page of this prospectus, regardless of the time of delivery of this prospectus or any sale of the securities offered by this prospectus.
We file annual, quarterly and current reports, proxy statements and other personinformation with the SEC. Our SEC filings are available to givethe public at the SEC’s website at www.sec.gov.
Copies of certain information filed by us with the SEC are also available on our website at www.exicuretx.com. Information contained in or accessible through our website does not constitute a part of this prospectus and is not incorporated by reference in this prospectus.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” information into this prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The SEC file number for the documents incorporated by reference in this prospectus is 000-55764 for documents filed with the SEC prior to July 30, 2019 and 001-39011 for documents filed with the SEC on or after July 30, 2019. The documents incorporated by reference into this prospectus contain important information that you should read about us.
The following documents are incorporated by reference into this document:
•our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the SEC on March 10, 2020;
•our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020, and September 30, 2020, filed with the SEC on May 14, 2020, August 12, 2020 and November 12, 2020, respectively;
•the information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2019 from our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 21, 2020;
•our Current Reports on Form 8-K, filed with the SEC on March 3, 2020, March 5, 2020, March 30, 2020, May 14, 2020, June 8, 2020, June 9, 2020, June 16, 2020, August 12, 2020, September 16, 2020, September 18, 2020, October 1, 2020 and November 12, 2020 to the extent the information in such reports is filed and not furnished; and
•the description of our common stock set forth in our registration statement on Form 8-A, filed with the SEC on July 30, 2019, including any further amendments thereto or reports filed for the purposes of updating this description.
We also incorporate by reference into this prospectus all documents (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are related to such items) that are filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (i) after the date of the initial filing of the registration statement of which this prospectus forms a part and prior to effectiveness of the registration statement, or (ii) after the date of this prospectus but prior to the termination of the offering. These documents include periodic reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements.
You can request a copy of these filings, at no cost, by writing or telephoning us at the following address or telephone number:
Exicure, Inc.
Attn: Secretary
2430 N. Halsted St.
Chicago, IL 60614
(847) 673-1700
35
The information in this prospectus is not complete and may be changed. We may not sell these securities or represent anythingaccept an offer to buy these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting offers to buy these securities in any state where such offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED DECEMBER 21, 2020
| PROSPECTUS SUPPLEMENT | ||||||||
| (To Prospectus dated , 2020) | ||||||||
__________________
Up to $50,000,000
Common Stock
__________________
We entered into an equity distribution agreement (the “Equity Distribution Agreement”), dated December 21, 2020, with BMO Capital Markets Corp., a Delaware corporation (the “Distribution Agent”), relating to shares of our common stock offered by this prospectus supplement and the accompanying prospectus. In accordance with the terms of the Equity Distribution Agreement, we may offer and sell, from time to time, our common stock through the Distribution Agent, as our sales agent. Sales of our common stock, if any, will be made in “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to this prospectus supplement, we may offer and sell shares of our common stock having an aggregate offering price of up to $50,000,000.
The Distribution Agent will receive from us a commission of up to 3.0% of the gross sales price per share for any common stock sold through the Distribution Agent as Distribution Agent under the Equity Distribution Agreement, as further described under “Plan of Distribution.” In connection with the sale of common stock on our behalf, the Distribution Agent will be deemed to be an “underwriter” within the meaning of the Securities Act, and the compensation of the Distribution Agent will be deemed to be an underwriting commission or discount.
Our common stock is listed on The Nasdaq Capital Market (the “Nasdaq”), under the symbol “XCUR.” The last reported sales price per share of our common stock on Nasdaq on December 17, 2020 was $1.58.
__________________
Investing in our common stock involves risks. See “Risk Factors” beginning on page S-5 of this prospectus supplement and under similar headings in the documents incorporated by reference into this prospectus supplement and page 6 of the accompanying prospectus.
__________________
Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying base prospectus. Any representation to the contrary is a criminal offense.
__________________
BMO Capital Markets
The date of this prospectus is , 2020.
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TABLE OF CONTENTS
| Page | |||||
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS | |||||
ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus relates to part of a registration statement on Form S-3 that we have filed with the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration process. Under this shelf registration process, we may sell any combination of the securities described in our base prospectus included in the shelf registration statement in one or more offerings up to a total aggregate offering price of $150,000,000. The $50,000,000 of common stock that may be offered, issued and sold under this prospectus is included in the $150,000,000 of securities that may be offered, issued and sold by us pursuant to our shelf registration statement. In connection with such offers and when accompanied by the base prospectus included in the registration statement of which this prospectus forms a part, this prospectus will be deemed a prospectus supplement to such base prospectus.
This prospectus relates to the offering of our common stock. Before buying any of the common stock that we are offering, we urge you to carefully read this prospectus, together with the information incorporated by reference as described under the headings “Where You Can Find More Information” and “Incorporation of Certain Information by Reference” in this prospectus. These documents contain important information that you should consider when making your investment decision.
This prospectus describes the terms of this offering of common stock and also adds to and updates information contained in the documents incorporated by reference into this prospectus. To the extent there is a conflict between the information contained in this prospectus. You must notprospectus, on the one hand, and the information contained in any document incorporated by reference into this prospectus that was filed with the SEC before the date of this prospectus, on the other hand, you should rely on the information in this prospectus. If any unauthorizedstatement in one of these documents is inconsistent with a statement in another document having a later date (for example, a document incorporated by reference into this prospectus) the statement in the document having the later date modifies or supersedes the earlier statement.
You should rely only on the information contained in or incorporated by reference in this prospectus and in any free writing prospectus that we have authorized for use in connection with this offering. We have not, and the
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Distribution Agent has not, authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus doesWe are not, and the Distribution Agent is not, making an offer to sell anythese securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus, the documents incorporated by reference in this prospectus, and in any free writing prospectus that we have authorized for use in connection with this offering, is accurate only as of the date of those respective documents. Our business, financial condition, results of operations and prospects may have changed since those dates. You should read this prospectus, the documents incorporated by reference in this prospectus, and any free writing prospectus that we have authorized for use in connection with this offering, in their entirety before making an investment decision.
Unless the context indicates otherwise, references in this prospectus to “Exicure,” “the Company,” “we,” “us,” “our” and similar references refer to Exicure, Inc. and its wholly owned subsidiaries.
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PROSPECTUS SUPPLEMENT SUMMARY
This summary highlights certain information about us, this offering and selected information contained elsewhere in or incorporated by reference into this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in our common stock. For a more complete understanding of our company and this offering, we encourage you to read and consider carefully the more detailed information in this prospectus, including the information incorporated by reference in this prospectus, and the information included in any free writing prospectus that we have authorized for use in connection with this offering, including the information under the heading “Risk Factors” in this prospectus on page S-6 and in the documents incorporated by reference into this prospectus.
EXICURE, INC.
We are a clinical-stage biotechnology company developing therapeutics for immuno-oncology, genetic disorders and other indications based on our proprietary Spherical Nucleic Acid, or SNA, technology. SNAs are nanoscale constructs consisting of densely packed synthetic nucleic acid sequences that are radially arranged in three dimensions. We believe the design of our SNAs gives rise to distinct chemical and biological properties that may provide advantages over other nucleic acid therapeutics and enable therapeutic activity outside of the liver. We are working to advance our SNA therapeutic candidate cavrotolimod (AST-008) in an ongoing Phase 1b/2 clinical trial in cancer patients.
We believe that one of the key strengths of our proprietary SNAs is that they have the potential to enter a number of different cells and organs. We have shown in clinical and preclinical studies that SNAs may have therapeutic potential in immuno-oncology and dermatology. In addition, we have shown in preclinical studies that SNAs may have therapeutic potential in neurology, ophthalmology, pulmonology, and gastroenterology. As a consequence, we have expanded our pipeline into neurology, and have conducted early stage research activities in ophthalmology, pulmonology, and gastroenterology.
Our Pipeline
The table below sets forth the current status of development of our SNA therapeutic candidates:
Corporate Information
We were originally incorporated in the State of Delaware on February 6, 2017 under the name “Max-1 Acquisition Corporation.” Prior to the Merger (as defined below), Max-1 was a “shell” company registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, with no specific business plan or purpose until it began operating the business of Exicure Operating Company, or Exicure OpCo, through a transaction on September 26, 2017, or the Merger. Exicure OpCo was originally formed as a limited liability company under the name AuraSense Therapeutics, LLC in the State of Delaware in June 2011 and was a clinical-stage biotechnology
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company developing gene regulatory and immuno-oncology therapeutics based on its proprietary SNA technology. AuraSense Therapeutics, LLC was subsequently converted into AuraSense Therapeutics, Inc., a Delaware corporation, on July 9, 2015, and changed its name on the same date to Exicure, Inc. Immediately after giving effect to the Merger and the initial closing of a private placement transaction on September 26, 2017, the business of Exicure OpCo became our business.
Our corporate headquarters are located at 2430 N. Halsted St., Chicago, Illinois 60614, and our telephone number is unlawful. Neither the delivery(847) 673-1700. Our website is www.exicuretx.com. The information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our securities.
Risks Associated with our Business
Our business is subject to numerous risks, as described under the heading “Risk Factors” contained herein, and under similar headings in the documents that are incorporated by reference into this prospectus. In particular, our risks include, but are not limited to, the following:
•We are a clinical-stage biotechnology company with a history of losses. We expect to continue to incur significant losses for the foreseeable future and may never achieve or maintain profitability, which could result in a decline in the market value of our common stock;
•Our approach to the discovery and development of innovative therapeutic treatments based on our technology is unproven and may not result in marketable products;
•Our therapeutic candidates are in early stages of development and may fail in development or suffer delays that materially and adversely affect their commercial viability;
•Product development involves a lengthy and expensive process with an uncertain outcome, and results of earlier preclinical studies and clinical trials may not be predictive of future clinical trial results;
•We will need substantial additional funds to advance the development of our therapeutic candidates, and we cannot guarantee that we will have sufficient funds available in the future to develop and commercialize our current or future therapeutic candidates;
•Our business could be adversely affected by the effects of health epidemics, including the global COVID‑19 coronavirus ("COVID-19") pandemic, in regions where we or third parties on which we rely have business operations and at our clinical trial sites, as well as the business or operations of our CROs or other third parties with whom we conduct business;
•If we continue to experience delays or difficulties in the enrollment of patients in clinical trials, our receipt of necessary regulatory approvals could be further delayed or prevented;
•Our quarterly operating results may fluctuate significantly or may fall below the expectations of investors or securities analysts, each of which may cause our stock price to fluctuate or decline;
•We may not successfully engage in strategic transactions, including any additional collaborations we seek, which could adversely affect our ability to develop and commercialize product candidates, impact our cash position, increase our expense and present significant distractions to our management;
•If third parties on which we depend to conduct our preclinical studies and clinical trials do not perform as contractually required, fail to satisfy regulatory or legal requirements, or miss expected deadlines, our development program could be delayed with materially adverse effects on our business, financial condition, results of operations and prospects;
•Because we rely on third-party manufacturing and supply partners, our supply of research and development, preclinical studies and clinical trial materials may become limited or interrupted or may not be of satisfactory quantity or quality;
•We face competition from entities that have developed or may develop therapeutic candidates for our target disease indications, including companies developing novel treatments and technology platforms based on modalities and technology similar to ours. If these companies develop technologies, including delivery
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technologies, or therapeutic candidates more rapidly than we do or their technologies are more effective, our ability to develop and successfully commercialize therapeutic candidates may be adversely affected;
•The market may not be receptive to our therapeutic candidates based on a novel therapeutic modality, and we may not generate any future revenue from the sale or licensing of therapeutic candidates;
•Any inability to attract and retain qualified key management and technical personnel would impair our ability to implement our business plan;
•We will continue to increase the size of our organization, and we may experience difficulties in managing growth;
•We currently license patent rights from Northwestern University and may in the future license patent rights from third-party owners or licensees. If Northwestern University or such other owners or licensees do not properly or successfully obtain, maintain or enforce the patents underlying such licenses, or if they retain or license to others any competing rights, our competitive position and business prospects may be adversely affected; and
•Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.
S-3
THE OFFERING
| Issuer | Exicure, Inc. | ||||
| Common Stock Being Offered | Shares of our common stock, par value $0.0001 per share, having an aggregate offering price of up to $50,000,000. | ||||
| Common Stock Outstanding Prior to the Offering | 87,598,536 shares of our common stock. | ||||
| Plan of Distribution | “At the market offering” that may be made from time to time through the Distribution Agent. See “Plan of Distribution” on page S-13. | ||||
| Use of Proceeds | We intend to use any net proceeds from the sale of our common stock to advance the development of our product candidates, fund research and development, acquire or invest in businesses, products or technologies that are complementary to our own, although we have no current plans, commitments or agreements with respect to any acquisitions as of the date of this prospectus, as well as for additional business development activities and working capital and other general corporate purposes. | ||||
| Risk Factors | See “Risk Factors” on page S-5 of this prospectus supplement and page 6 of the accompanying prospectus for a discussion of factors you should carefully consider before investing in shares of our common stock. | ||||
| Exchange Listing | Our shares of common stock are traded on The Nasdaq Capital Market under the symbol “XCUR.” | ||||
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RISK FACTORS
Investing in our common stock involves a high degree of risk. You should carefully review the risks and uncertainties described under the heading “Risk Factors” contained in our Annual Report on Form 10-K for the year ended December 31, 2019 as updated by our annual, quarterly and other reports and documents that are incorporated by reference into this prospectus. Each of the risk factors described in the documents referenced above could adversely affect our business, operating results and financial condition, as well as adversely affect the value of an investment in our shares, and the occurrence of any of these risks might cause you to lose all or part of your investment. Additional risks not presently known to us or that we currently believe are immaterial may also significantly impair our business operations. Please also read carefully the section below titled “Special Note Regarding Forward-Looking Statements.”
Risks Related To This Offering
Our management might apply the net proceeds from this offering in ways with which you do not agree and in ways that may impair the value of your investment.
Except as described in any applicable prospectus supplement or in any free writing prospectuses that we may authorize for use in connection with a specific offering, we currently intend to use the net proceeds from the sale of the securities offered hereby, if any, to advance the development of our product candidates, fund research and development, acquire or invest in businesses, products or technologies that are complementary to our own, although we have no current plans, commitments or agreements with respect to any acquisitions as of the date of this prospectus, as well as for additional business development activities and working capital and other general corporate purposes. Pending the use of net proceeds from this offering as further described in the section titled “Use of Proceeds,” we intend to invest the net proceeds in short-term, investment-grade, interest bearing obligations, certificates of deposit or direct or guaranteed obligations of the United States. Our management has broad discretion as to the use of these proceeds and you will be relying on the judgment of our management regarding the application of these proceeds. We might apply these proceeds in ways with which you do not agree, or in ways that do not yield a favorable or any return. If our management applies these proceeds in a manner that does not yield a significant return, if any, on our investment of these net proceeds, it could compromise our ability to pursue our growth strategy and adversely affect the market price of our common stock.
If you purchase shares of our common stock sold in this offering, you may experience immediate and substantial dilution in the net tangible book value of your shares.
The price per share of our common stock being offered may be higher than the net tangible book value per share of our outstanding common stock prior to this offering, which may result in new investors in this offering incurring immediate dilution. See “Dilution” on page S-11.
You may experience future dilution as a result of future equity offerings.
We will require more capital to pursue our preclinical and clinical activities, regulatory approval and the commercialization of our current or future drug candidates. In addition, we may also choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To raise additional capital, we may in the future offer additional shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that may not be the same as the price per share in this offering. We may sell shares or other securities in any other offering at a price per share that is less than the price per share paid by investors in this offering, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per share at which we sell additional shares of our common stock, or securities convertible or exchangeable into common stock, in future transactions may be higher or lower than the price per share paid by investors in this offering.
It is not possible to predict the actual number of shares we will sell under the sales agreement, or the gross proceeds resulting from those sales.
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Subject to certain limitations in the Equity Distribution Agreement and compliance with applicable law, we have the discretion to deliver instruction to the Distribution Agent to sell shares of our common stock at any time throughout the term of the equity distribution agreement. The number of shares that are sold through the Distribution Agent after our instruction will fluctuate based on a number of factors, including the market price of our common stock during the sales period, the limits we set with the Distribution Agent in any instruction to sell shares, and the demand for our common stock during the sales period. Because the price per share of each share sold will fluctuate during this offering, it is not currently possible to predict the number of shares that will be sold, if any, or the gross proceeds to be raised in connection with those sales.
We do not intend to pay dividends on our common stock so any returns will be limited to the value of our
stock.
We have never declared or paid any cash dividend on our common stock. We do not plan to declare or pay
any cash dividends in the foreseeable future. Additionally, our credit facility with Midcap Financial Trust contains a
negative covenant that restricts our ability to make dividend payments and other distributions and payments to
stockholders and certain other people. Any return to stockholders will therefore be limited to the appreciation of
their stock.
The common stock offered hereby will be sold in “at the market offerings,” and investors who buy shares at different times will likely pay different prices.
Investors who purchase shares in this offering at different times will likely pay different prices, and so may experience different levels of dilution and different outcomes in their investment results. We will have discretion, subject to market demand, to vary the timing, prices, and numbers of shares sold in this offering. In addition, subject to the final determination by our board of directors, there is no minimum or maximum sales price for shares to be sold in this offering. Investors may experience a decline in the value of the shares they purchase in this offering as a result of sales made at prices lower than the prices they paid.
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference contain forward-looking statements. These are based on our management’s current beliefs, expectations and assumptions about future events, conditions and results and on information currently available to us. Discussions containing these forward-looking statements may be found, among other places, in the sections titled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K, as well as any amendments thereto, filed with the SEC.
Any statements in this prospectus, or incorporated herein, about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. Within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, these forward-looking statements include statements regarding:
•the use of proceeds from this offering;
•our expectations regarding the impact of the ongoing COVID-19 pandemic including the expected duration of disruption and immediate and long-term delays, interruptions or other adverse effects to clinical trials, patient enrollment and clinical activation, delays in regulatory review, preclinical research and development, or R&D, collaboration and partnership programs, manufacturing and supply chain interruptions, adverse effects on healthcare systems and disruption of the global economy overall, and the overall impact of the COVID-19 pandemic on our business, financial condition and results of operations;
•our estimates of expenses, ongoing losses, future revenue and capital requirements, including our expectations relating to our needs for additional financing;
•the initiation, timing, progress and results of our current and future preclinical studies, clinical trials, collaboration and partnership programs, including our ongoing clinical trials and any planned clinical trials for cavrotolimod AST-008 or any of our product candidates, and the research and development programs we pursue;
•our ability to advance our product candidates into, and successfully complete, clinical trials;
•the timing and likelihood of regulatory filings for our current and future product candidates including any Investigational New Drug, or IND, application, Investigational Medicinal Product Dossier, or IMPD, Clinical Trial Application, or CTA, New Drug Application, or NDA, or other regulatory submissions;
•our ability to obtain and maintain regulatory approval of our product candidates in the indications for which we plan to develop them, and any related restrictions, limitations or warnings in the label of an approved drug or therapy;
•the size and growth potential of the markets for our product candidates, if approved, and the rate and degree of market acceptance of our product candidates, including reimbursement that may be received from payors;
•the diversion of healthcare resources away from the conduct of clinical trials as a result of the ongoing COVID-19 pandemic, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;
•the interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel, quarantines or social distancing protocols imposed or recommended by federal or state governments, employers and others or voluntarily adopted in connection with the ongoing COVID-19 pandemic;
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•our dependence on current and future collaborators for advancement of therapeutic candidates pursuant to the terms of such collaborations, including ability to obtain and maintain regulatory approval and commercialization, if approved;
•the status of clinical trials, development timelines and discussions with regulatory authorities related to product candidates under development by us and our collaborators;
•our receipt and timing of any milestone payments or royalties under any current or future research collaboration and license agreements or arrangements;
•our ability to identify and develop therapeutic candidates for treatment of additional disease indications;
•the rate and degree of market acceptance of any approved therapeutic candidates;
•the commercialization of any approved therapeutic candidates;
•the implementation of our business model and strategic plans for our business, technologies and therapeutic candidates;
•our ability to obtain additional funds for our operations;
•our ability to obtain and maintain intellectual property protection for our technologies and therapeutic candidates and our ability to operate our business without infringing the intellectual property rights of others;
•our reliance on third parties to conduct our preclinical studies and clinical trials;
•our reliance on third party supply and manufacturing partners to supply the materials and components for, and manufacture, our research and development, preclinical and clinical trial supplies;
•our expectations regarding our ability to attract and retain qualified key management and technical personnel;
•our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012, or JOBS Act;
•statements regarding our internal controls;
•the impact of government laws and regulations as well as developments relating to our competitors or our industry; and
•other factors that may impact our financial results.
These risks are not exhaustive. Other sections of this prospectus or the documents incorporated by reference may include additional factors that could harm our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by law, we undertake no obligation to
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update publicly any forward-looking statements for any reason after the date of this prospectus or to conform these statements to actual results or to changes in our expectations.
You should carefully read this prospectus, together with the information incorporated herein by reference as described under the heading “Incorporation of Certain Information by Reference,” and the documents that we reference in this prospectus and have filed as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
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USE OF PROCEEDS
We may issue and sell shares of our common stock from time to time. Because there is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable at this time. There can be no assurance that we will sell any shares under or fully utilize the Equity Distribution Agreement with the Distribution Agent as a source of financing.
We will retain broad discretion over the use of the net proceeds from the sale of the securities offered hereby. Except as described in any applicable prospectus supplement or in any free writing prospectuses that we may authorize for use in connection with a specific offering, we currently intend to use the net proceeds from the sale of the securities offered hereby, if any, to advance the development of our product candidates, fund research and development, acquire or invest in businesses, products or technologies that are complementary to our own, although we have no current plans, commitments or agreements with respect to any acquisitions as of the date of this prospectus, as well as for additional business development activities and working capital and other general corporate purposes. We will set forth in the applicable prospectus supplement or free writing prospectus our intended use for the net proceeds received from the sale of any securities sold pursuant to the prospectus supplement or free writing prospectus. Pending the use of net proceeds, we intend to invest the net proceeds in short-term, investment-grade, interest-bearing obligations, certificates of deposit or direct or guaranteed obligations of the United States.
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DILUTION
If you invest in our shares of common stock in this offering, your interest will be diluted to the extent of the difference between the public offering prices per common share in this offering and the as adjusted net tangible book value per common share immediately after this offering.
Our net tangible book value as of September 30, 2020 was approximately $64.7 million, or $0.74 per share. Net tangible book value per share is determined by dividing our total tangible assets, less total liabilities, by the number of shares of our common stock outstanding as of September 30, 2020. Dilution with respect to net tangible book value per share represents the difference between the amount per share paid by purchasers of shares of common stock in this offering and the net tangible book value per share of our common stock immediately after this offering.
After giving effect to the sale of 31,645,569 shares of our common stock in this offering at an assumed offering price of $1.58 per share, the last reported sale price of our common stock on Nasdaq on December 17, 2020, and after deducting estimated offering commissions and offering expenses payable by us, our as adjusted net tangible book value as of September 30, 2020 would have been approximately $113.3 million, or $0.95 per share. This represents an immediate increase in net tangible book value of $0.21 per share to existing stockholders and immediate dilution of $0.63 per share to investors purchasing our common stock in this offering at the public offering price. The following table illustrates this dilution on a per share basis:
| Assumed public offering price per share | $ | 1.58 | ||||||
| Net tangible book value per share of as September 30, 2020 | $ | 0.74 | ||||||
| Increase in net tangible book value per share attributable to this offering | $ | 0.21 | ||||||
| As adjusted net tangible book value per share as of September 30, 2020, after giving effect to this offering | $ | 0.95 | ||||||
| Dilution per share to investors purchasing our common stock in this offering | $ | 0.63 | ||||||
The above discussion and table are based on 87,228,586 shares of our common stock outstanding as of September 30, 2020, and exclude:
•7,739,781 shares of our common stock issuable upon the exercise of stock options outstanding as of September 30, 2020 under our 2017 Equity Incentive Plan, or the 2017 Plan, and at a weighted average exercise price of $2.20 per share;
•2,219,311 shares of common stock reserved for future issuance under our 2017 Plan, plus any additional shares of our common stock that may become available under our 2017 Plan; and
•940,933 shares of our common stock reserved for issuance under our 2017 Employee Stock Purchase Plan, or ESPP, as well as any future increases in the number of shares of our common stock reserved for issuance under the ESPP.
The table above assumes for illustrative purposes that an aggregate of 31,645,569 shares of our common stock are sold during the term of the Equity Distribution Agreement with the Distribution Agent at a price of $1.58 per share, the last reported sale price of our common stock on Nasdaq on December 17, 2020, for aggregate gross proceeds of approximately $50.0 million. The shares subject to the Equity Distribution Agreement with the Distribution Agent are being sold from time to time at various prices. An increase of $0.50 per share in the price at which the shares are sold from the assumed offering price of $1.58 per share shown in the table above, assuming all of our common stock in the aggregate amount of $50.0 million during the term of the Equity Distribution Agreement with the Distribution Agent is sold at that price, would increase our adjusted net tangible book value per share after
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the offering to $1.02 per share and would increase the dilution in net tangible book value per share to new investors in this offering to $1.06 per share, after deducting commissions and estimated aggregate offering expenses payable by us. A decrease of $0.50 per share in the price at which the shares are sold from the assumed offering price of $1.58 per share shown in the table above, assuming all of our common stock in the aggregate amount of $50.0 million during the term of the Equity Distribution Agreement with the Distribution Agent is sold at that price, would decrease our adjusted net tangible book value per share after the offering to $0.85 per share and would decrease the dilution in net tangible book value per share to new investors in this offering to $0.23 per share, after deducting commissions and estimated aggregate offering expenses payable by us. This information is supplied for illustrative purposes only.
To the extent that outstanding options outstanding as of September 30, 2020 have been or may be exercised or other shares issued, investors purchasing our common stock in this offering may experience further dilution. In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our stockholders.
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PLAN OF DISTRIBUTION
We have entered into the Equity Distribution Agreement under which we may offer and sell shares of our common stock from time to time through or to the Distribution Agent, as sales agent or principal. Sales of the shares of our common stock under this prospectus supplement, if any, will be in “at the market offerings” as defined in Rule 415(a)(4) under the Securities Act, including, without limitation, sales made directly on the Nasdaq or on any other existing trading market for our common stock. Pursuant to this prospectus supplement, we may offer and sell shares of our common stock having an aggregate offering price of up to $50,000,000. The Distribution Agent will not engage in any transactions that stabilize the price of our common stock.
From time to time during the term of the Equity Distribution Agreement, we will notify the Distribution Agent of the trading days on which the shares of common stock are to be sold, the maximum number of shares that are to be sold in the aggregate and on each trading day, and the minimum price at which we are willing to sell the shares of common stock. Once we have so instructed the Distribution Agent, unless the Distribution Agent declines to accept the terms of such notice or until such notice is terminated or suspended as permitted by the Equity Distribution Agreement, the Distribution Agent will use commercially reasonable efforts to sell such shares up to the amount specified on such terms. The obligations of the Distribution Agent under the Equity Distribution Agreement are subject to a number of customary conditions that we must meet. The obligation of the Distribution Agent under the Equity Distribution Agreement to sell shares pursuant to any notice is subject to a number of conditions, which the Distribution Agent reserves the right to waive in its sole discretion. We or the Distribution Agent may suspend the offering of common stock at any time and from time to time by notifying the other party.
Under the terms of the Equity Distribution Agreement, we also may sell shares of common stock to the Distribution Agent as principal for its own account or the account of its clients at a price agreed upon at the time of sale. If we sell common stock to the Distribution Agent as principal, we will enter into a separate terms agreement with the Distribution Agent and we will describe this terms agreement in a separate prospectus supplement or pricing supplement.
The Distribution Agent will provide written confirmation to us following the close of trading on each trading day on which the Distribution Agent has sold shares of our common stock for us under the Equity Distribution Agreement. Each confirmation will include (i) the number of shares of our common stock sold on such trading day, (ii) the gross offering proceeds received from such sales, (iii) the commission payable by us to the Distribution Agent with respect to such sales and (iv) the net offering proceeds (being the gross offering proceeds for such sales less the commission payable for such sales). We will report at least quarterly the number of shares of common stock sold through the Distribution Agent under the Equity Distribution Agreement, the net proceeds to us (before expenses) and the commission of the Distribution Agent in connection with the sales of the common stock.
Settlement for sales of our common stock will occur on the second trading day following the date on which any sales are made or such earlier day as is industry practice for regular-way trading, with respect to any particular transaction. Sales of our common stock as contemplated by this prospectus supplement will be settled either by free delivery of our common stock by us or our transfer agent to the Distribution Agent or through the facilities of The Depository Trust Company or by such other means as we and the Distribution Agent may agree upon. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.
We will pay the Distribution Agent a commission of up to 3.0% of the gross sale proceeds from the sales of shares of common stock under the Equity Distribution Agreement. We have also agreed to reimburse the Distribution Agent for certain specified expenses, including reasonable and documented fees and disbursements of its legal counsel, in an amount not to exceed $85,000. We estimate that the total expenses for the offering, excluding compensation and reimbursements payable to the Distribution Agent under the terms of the Equity Distribution Agreement, will be approximately $400,000. Because there is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable at this time.
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In connection with the sale of shares of common stock on our behalf hereunder, shall createthe Distribution Agent will be deemed to be an “underwriter” within the meaning of the Securities Act, and the compensation paid to the Distribution Agent will be deemed to be underwriting commissions or discounts. We have agreed to provide indemnification and contribution to the Distribution Agent against specified liabilities, including liabilities under the Securities Act.
The offering of common stock pursuant to the Equity Distribution Agreement will terminate upon the earlier of (i) the sale of all shares of common stock subject to the Equity Distribution Agreement or (ii) the termination of the Equity Distribution Agreement by the Distribution Agent or us in accordance with the terms of the Equity Distribution Agreement.
This summary of the material provisions of the Equity Distribution Agreement does not purport to be a complete statement of its terms and conditions. A copy of the Equity Distribution Agreement is being filed herewith as Exhibit 1.2 and is incorporated by reference into the registration statement of which this prospectus supplement and accompanying prospectus is a part. See “Where You Can Find More Information” in this prospectus supplement.
The Distribution Agent and certain of its affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the ordinary course of business with us or our affiliates. The Distribution Agent and such affiliates have received, or may in the future receive, customary fees and expenses for these transactions. In addition, in the ordinary course of their various business activities, the Distribution Agent and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (which may include bank loans) for their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments of ours or our affiliates. The Distribution Agent or its affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.
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LEGAL MATTERS
The validity of the securities offered by this prospectus will be passed upon by Cooley LLP, Boston, Massachusetts. Certain legal matters in connection with this offering will be passed upon for the Distribution Agent by Mayer Brown LLP.
EXPERTS
The consolidated financial statements of Exicure, Inc. as of December 31, 2019 and 2018, and for each of the years in the two-year period ended December 31, 2019, have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing. The audit report covering the December 31, 2019 consolidated financial statements refers to the adoption of Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 842, Leases.
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement we filed with the SEC. This prospectus does not contain all of the information set forth in the registration statement and the exhibits to the registration statement. For further information with respect to us and the securities we are offering under this prospectus, we refer you to the registration statement and the exhibits and schedules filed as a part of the registration statement. You should rely only on the information contained in this prospectus or incorporated by reference. We have not authorized anyone else to provide you with different information. We are not making an offer of these securities in any implicationstate where the offer is not permitted. You should not assume that the information in this prospectus is correctaccurate as of any date other than the date on the front page of this prospectus, regardless of the time of delivery of this prospectus or any sale of the securities offered by this prospectus.
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public at the SEC’s website at www.sec.gov.
Copies of certain information filed by us with the SEC are also available on our website at www.exicuretx.com. Information contained in or accessible through our website does not constitute a part of this prospectus and is not incorporated by reference in this prospectus.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” information into this prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The SEC file number for the documents incorporated by reference in this prospectus is 000-55764 for documents filed with the SEC prior to July 30, 2019 and 001-39011 for documents filed with the SEC on or after July 30, 2019. The documents incorporated by reference into this prospectus contain important information that you should read about us.
The following documents are incorporated by reference into this document:
•our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the SEC on March 10, 2020;
•our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020, and September 30, 2020 filed with the SEC on May 14, 2020, August 12, 2020 and November 12, 2020, respectively;
•the information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2019 from our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 21, 2020;
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•our Current Reports on Form 8-K, filed with the SEC on March 3, 2020, March 5, 2020, March 30, 2020, May 14, 2020, June 8, 2020, June 9, 2020, June 16, 2020, August 12, 2020, September 16, 2020, September 18, 2020, October 1, 2020 and November 12, 2020 to the extent the information in such reports is filed and not furnished; and
•the description of our common stock set forth in our registration statement on Form 8-A, filed with the SEC on July 30, 2019, including any further amendments thereto or reports filed for the purposes of updating this description.
We also incorporate by reference into this prospectus all documents (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are related to such items) that are filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (i) after the date hereof.of the initial filing of the registration statement of which this prospectus forms a part and prior to effectiveness of the registration statement, or (ii) after the date of this prospectus but prior to the termination of the offering. These documents include periodic reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements.
You can request a copy of these filings, at no cost, by writing or telephoning us at the following address or telephone number:
Exicure, Inc.
Attn: Secretary
2430 N. Halsted St.
Chicago, IL 60614
(847) 673-1700
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Up to $50,000,000
Common Stock
__________________
PROSPECTUS SUPPLEMENT
__________________
BMO Capital Markets
, 2020
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.Distribution
The following table sets forth below is an estimate (except in the case of the registration fee) of the amount of feescosts and expenses, to be incurred in connection with the issuance and distribution of the offered securities, other than underwriting discounts and commissions.commissions, payable by us in connection with the offering of the securities being registered. All the amounts shown are estimates, except for the SEC registration fee and FINRA filing fee.
| Registration fee | $ | 15,150 | |
| FINRA filing fee | 19,250 | ||
| Legal fees and expenses | * | ||
| Accounting fees and expenses | * | ||
| Printing expenses | * | ||
| Transfer agent and registrar fees | * | ||
| Trustee fees (including counsel fees) | * | ||
| Miscellaneous | * | ||
| Total | * | ||
| SEC registration fee | $16,365 | ||||
| FINRA filing fee (if applicable) | * | ||||
| * | |||||
| Legal fees and expenses | * | ||||
| Transfer agent, printing and miscellaneous expenses | * | ||||
| Total | $ * | ||||
* These fees are calculated based on the securities offered and/or the number of issuances and, accordingly, cannot be estimated at this time.
Item 15. Indemnification of DirectorsOfficers and Officers.Directors
We are incorporated under the laws of the State of Delaware. Under Section 145 of the Delaware General Corporation Law, (the “DGCL”)or DGCL, we have broad powers to indemnify our directors and officers against liabilities they may incur in such capacities, including liabilities under the Securities Act of 1933, as amended, or the Securities Act. Section 145 of the DGCL generally provides that a Delaware corporation mayhas the power to indemnify its present and former directors, officers, employees and agents against expenses incurred by them in connection with any persons who were,suit to which they are or are threatened to be made, parties to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation),a party by reason of the fact thattheir serving in such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporationpositions so long as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such personthey acted in good faith and in a manner he or shethey reasonably believed to be in or not opposed to, the corporation’s best interests of the corporation and, with respect to any criminal action, or proceeding,they had no reasonable cause to believe that his or hertheir conduct was illegal.
Our amended and restated certificate of incorporation providesand amended and restated bylaws include provisions that (i) to the fullest extent permitted by the DGCL, a director shall not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty
as a director. Our amended and restated bylaws provide that we shalldirector; (ii) require us to indemnify and hold harmless our directors and officers to the fullest extent permitted by applicable law, except that we will not be required to indemnify or hold harmless any director or officer in connection with any proceeding initiated by such person unless the proceeding was authorized by our board of directors. Under our amendeddirectors; and restated bylaws, such rights shall not be exclusive of any other rights acquired by directors and officers, including by agreement.
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us or to our stockholders when such director was aware or should have been aware of a risk of serious injury to us or to our stockholders, for acts or omission that constitute an unexcused pattern of inattention that amounts to an abdication of such director’s duty to us or to our stockholders, for improper transactions between such director and us and for improper loans to directors and officers. These provisions also do not affect a director’s responsibilities under any other law, such as the federal securities law or state or federal environmental laws.
As permitted by Delaware law, we have entered into indemnification agreements with each of our current directors and officers.officers pursuant to the foregoing provisions. These agreements provide for the indemnification of our directors and executive officers for all reasonable expenses and liabilities incurred in connection with any action or proceeding brought or threatened to be brought against them by reason of the fact that they are or were our agents.
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Item 16. Exhibits and Financial Statement Schedules
| Exhibit Number | Description of Document | |||||||
| 1.1* | Form of Underwriting Agreement. | |||||||
| 1.2 | ||||||||
| 3.1 | Certificate of Amendment to Certificate of Incorporation (incorporated herein by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K (File No. 000-55764)), filed with the Commission on October 2, 2017. | |||||||
| 3.2 | Form of Amended and Restated Certificate of Incorporation (incorporated herein by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K (File No. 000-55764)), filed with the Commission on October 2, 2017. | |||||||
| 3.3 | Amended and Restated Bylaws, as currently in effect (incorporated herein by reference to Exhibit 3.4 to the Registrant’s Current Report on Form 8-K (File No. 000-55764)), filed with the Commission on October 2, 2017. | |||||||
| 4.1* | Specimen Preferred Stock Certificate and Form of Certificate of Designation of Preferred Stock. | |||||||
| 4.2 | ||||||||
| 4.3* | Form of Debt Securities. | |||||||
| 4.4 | ||||||||
| 4.5 | ||||||||
| 4.6 | ||||||||
| 5.1 | ||||||||
| 23.1 | ||||||||
| 23.2 | ||||||||
| 24.1 | ||||||||
| 25.1** | Statement of Eligibility of Trustee under the Indenture. | |||||||
* To be filed, with this registration statement on Form S-3 is set forth onif applicable, by amendment or by a report filed under the Exhibit IndexExchange Act and is incorporated herein by reference.
** To be filed, if applicable, in accordance with the requirements of Section 305(b)(2) of the Trust Indenture Act of 1939 and Rule 5b-3 thereunder.
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Item 17. Undertakings.Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, however,that subparagraphs the undertakings set forth in paragraphs (1)(i), (1)(ii) and (1)(iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the CommissionSEC by the Registrantregistrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, that are incorporated by reference in this registration statement or isare contained in a form of prospectus filed pursuant to Rule 424(b) that is part of this registration statement.
(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the Securities Act to any purchaser:
(i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement.
(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a
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time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(5) That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the |
(i) any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to |
(ii) any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) the portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(6) That, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(7) To file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the SEC under Section 305(b)(2) of the TIA,Trust Indenture Act.
Insofar as applicable.indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrantregistrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Skokie,Chicago, State of Illinois, on March 8, 2019.December 21, 2020.
EXICURE, INC.
| By: | /s/ David A. Giljohann | |||||
| David A. Giljohann, Ph.D. | ||||||
President, Chief Executive Officer, and | ||||||
| Interim Chief Financial Officer | ||||||
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POWER OF ATTORNEY
We, the undersigned directors and officers of Exicure, Inc. (the Company), hereby severally constitute and appoint David A. Giljohann and David S. Snyder,Timothy P. Walbert, and each of them singly, our true and lawful attorneys-in-fact,attorneys, with full powerpowers of substitution and resubstitution to them, and to each of them singly, to sign for us and in our names in the capacities indicated below, the registration statement on Form S-3 filed herewith, and any and all amendments (including pre-effective and post-effective amendmentsamendments) to saidthis registration statement, and any registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, in connection with the registration under the Securities Act of 1933, as amended, of equity securities of the Company, and to file or cause to be filed the same, with all exhibits thereto and other documents in connection therewith and to sign any subsequent registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file or cause to be filed the same, together with all schedules and exhibits thereto, with the Securities and Exchange Commission, and generally to do all such things in their names and behalf in their capacities as officers and/or directors to enable Exicure, Inc. to comply with the provisions of the Securities Act of 1933, as amended, and all requirements of the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as each of them might or could do in person, and hereby ratifying and confirming all that said attorneys-in-fact and eachagents, or any of them, or theirhis or her substitute or substitutes, shall do or cause to be done by virtue of this Power of Attorney. This Power of Attorney does not revoke any power of attorney previously granted by the undersigned, or any of them.
Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities indicated and on the date indicated:
dates indicated.
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| SIGNATURES | TITLE | DATE | ||||||||||||
| /s/ David A. Giljohann | Chief Executive Officer, Interim Chief Financial Officer and Director (Principal Executive Officer and Interim Principal Financial Officer and Interim Principal Accounting Officer) | December 21, 2020 | ||||||||||||
| David A. Giljohann, Ph.D | ||||||||||||||
| /s/ | ||||||||||||||
| Director and Chairman of the Board of Directors | December 21, 2020 | |||||||||||||
| /s/ David R. Walt | Director | December 21, 2020 | ||||||||||||
| David R. Walt, Ph.D. | ||||||||||||||
| /s/ Jay R. Venkatesan | Director | December 21, 2020 | ||||||||||||
| Jay R. Venkatesan, M.D. | ||||||||||||||
| /s/ | Director | December 21, 2020 | ||||||||||||
| /s/ Bosun Hau | Director | December 21, 2020 | ||||||||||||
| Bosun Hau | ||||||||||||||
| /s/ Chad A. Mirkin | Director | December 21, 2020 | ||||||||||||
| Chad A. Mirkin, Ph.D. | ||||||||||||||
| /s/ Bali Muralidhar | Director | December 21, 2020 | ||||||||||||
| Bali Muralidhar, M.D., Ph.D. | ||||||||||||||
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