Filed Pursuant to Rule 424(b)(5)
Registration No. 333-254299
PROSPECTUS
SUPPLEMENT
(To Prospectus dated March 26,
2021)
Up
to $75,000,000
Common Stock
We have entered
into an Open Market Sale AgreementSM (the “Sales
Agreement”) with Jefferies LLC (“Jefferies”)
relating to the sale of shares of our common stock, par value
$0.001 per share, offered by this prospectus supplement. In
accordance with the terms of the Sales Agreement, we may offer and
sell shares of our common stock having an aggregate offering price
of up to $75,000,000 from time to time through Jefferies, acting as
sales agent.
Our common stock is
listed on the Nasdaq Capital Market under the trading symbol
“VTGN.” On May 12, 2021, the last reported sale price
of our common stock on the Nasdaq Capital Market was $2.33 per
share.
Sales of our common
stock, if any, under this prospectus supplement may be made in
sales deemed to be an “at the market offering” as
defined in Rule 415(a)(4) promulgated under the Securities Act
of 1933, as amended (the “Securities Act”).
Jefferies
is not required to sell any specific amount of securities, but will
act as our sales agent using commercially reasonable efforts
consistent with its normal trading and sales practices, on mutually
agreed terms between Jefferies and us. There is no
arrangement for funds to be received in any escrow, trust or
similar arrangement.
Jefferies will be
entitled to compensation at a fixed commission rate equal to 3.0%
of the gross proceeds of any shares of common stock sold under the
Sales Agreement. In connection with the sale of our common stock on
our behalf, Jefferies will be deemed to be an
“underwriter” within the meaning of the Securities Act,
and the compensation of Jefferies will be deemed to be underwriting
commissions or discounts. We have also agreed to
provide indemnification and contribution to Jefferies with respect
to certain liabilities, including liabilities under the Securities
Act or the Securities Exchange Act of 1934, as amended (the
Exchange Act). See “Plan of Distribution” beginning
on page S-12 for additional information regarding
the compensation to be paid to Jefferies.
Investing
in our common stock involves a high degree of risk. See the
information contained under the heading “Risk
Factors” beginning on page S-3 of this prospectus
supplement and under similar headings in the accompanying
prospectus and in the other documents that are incorporated by
reference herein and therein, including specifically under
“Item 1A: Risk Factors” and elsewhere in our Annual
Report on Form 10-K for the fiscal year ended March 31, 2020
and in our Quarterly Reports on Form 10-Q for the periods ended
June 30, 2020, September 30, 2020 and December 31, 2020,
before making a decision to invest in our common
stock.
Neither
the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or
determined if this prospectus supplement or the accompanying
prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
Jefferies
The
date of this prospectus supplement is May 14, 2021.
TABLE OF CONTENTS
Prospectus
Supplement
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S-ii
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S-1
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S-2
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S-3
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S-9
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S-10
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S-11
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S-12
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S-13
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S-13
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S-13
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S-14
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Prospectus
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ABOUT
THIS PROSPECTUS
SUPPLEMENT
This document
contains two parts.
●
The
first part is this prospectus supplement, which describes the
specific terms of this offering and also supplements and updates
information contained in the accompanying prospectus and the
documents incorporated by reference herein and
therein.
●
The
second part is the accompanying prospectus filed with the
Securities and Exchange Commission (the “SEC”) as part
of a registration statement on Form S-3 initially filed on March
15, 2021, which provides more general information, some of which
may not apply to this offering.
If the information
contained in this prospectus supplement differs or varies from the
information contained in the accompanying prospectus or in any
document incorporated by reference herein or therein that was filed
with the SEC before the date of this prospectus supplement, you
should rely on the information set forth in this prospectus
supplement. This prospectus supplement is deemed a prospectus
supplement to the accompanying prospectus contained in the
registration statement of which such prospectus forms a part solely
for the purpose of this offering. If any statement in one of these
documents is inconsistent with a statement in another document
having a later date (for example, a subsequently filed document
deemed incorporated by reference in the accompanying prospectus),
the statement in the document having the later date modifies or
supersedes the earlier statement. Any statement so modified or
superseded will not be deemed, except as so modified or superseded,
to constitute a part of this prospectus supplement.
You should rely
only on the information contained or incorporated by reference in
this prospectus supplement and the accompanying prospectus, along
with the information in any related free writing prospectus filed
by us with the SEC. We have not, and the sales agent has not,
authorized anyone to provide you with different information that is
in addition to or different from that contained or incorporated by
reference in this prospectus supplement, the accompanying
prospectus or any related free writing prospectus. We and the sales
agent take no responsibility for, and can provide no assurance as
to the reliability of, any other information that others may
provide.
We are offering to
sell, and seeking offers to buy, shares of our common stock only in
jurisdictions where such offers and sales are permitted. The
information contained in this prospectus supplement, the
accompanying prospectus, any related free writing prospectus and
the documents incorporated by reference herein and therein is
accurate only as of their respective dates (or any such earlier
date as of which information is given), regardless of the time of
delivery of any such document or the time of any sale of our common
stock. Our business, financial condition, results of operations and
prospects may have changed materially since those dates. It is
important for you to read and consider all information contained or
incorporated by reference in this prospectus supplement and the
accompanying prospectus in making your investment decision. You
should read both this prospectus supplement and the accompanying
prospectus, as well as the documents incorporated by reference
herein and therein, the additional information described under the
section titled “Where You Can Find More Information” in
this prospectus supplement and in the accompanying prospectus and
any free writing prospectus that we have authorized for use in
connection with this offering, before investing in our common
stock.
We further note
that the representations, warranties and covenants made by us in
any agreement that is filed as an exhibit to any document that is
incorporated by reference in the accompanying prospectus were made
solely for the benefit of the parties to such agreement, including,
in some cases, for the purpose of allocating risk among the parties
to such agreements, and should not be deemed to be a
representation, warranty or covenant to you. Moreover, such
representations, warranties or covenants were accurate only as of
the date when made. Accordingly, such representations, warranties
and covenants should not be relied on as accurately representing
the current state of our affairs.
Unless otherwise
specified or the context otherwise requires, references in this
prospectus supplement, the accompanying prospectus and any free
writing prospectus to “VistaGen,” “we,”
“our,” “us” and “the Company”
refer, collectively, to VistaGen Therapeutics, Inc., a Nevada
corporation, and its consolidated subsidiaries.
This prospectus
supplement, the accompanying prospectus and the documents
incorporated by reference herein and therein contain estimates,
projections and other information concerning our industry, our
business, and the markets for certain diseases, including data
regarding the estimated size of those markets, and the incidence
and prevalence of certain medical conditions. Information that is
based on estimates, forecasts, projections, market research or
similar methodologies is inherently subject to uncertainties and
actual events or circumstances may differ materially from events
and circumstances reflected in this information. Unless otherwise
expressly stated, we obtained this industry, business, market and
other data from reports, research surveys, studies and similar data
prepared by market research firms and other third parties,
industry, medical and general publications, government data and
similar sources. Additionally, while such information has been
obtained from sources believed to be reliable, there can be no
assurance as to the accuracy or completeness of the included
information. The Company has not independently verified any of the
data from third-party sources, nor has the Company ascertained the
underlying economic assumptions relied upon therein. While such
information is believed to be reliable for the purposes used
herein, none of the Company, its affiliates, nor their respective
directors, officers, employees, members, partners, stockholders or
agents make any representation or warranty with respect to the
accuracy of such information.
S-ii
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PROSPECTUS SUPPLEMENT SUMMARY
This summary highlights selected information about us and this
offering and does not contain all of the information that you
should consider before investing in our securities. Before
investing in our common stock, you should carefully read the
information contained and incorporated by reference in this
prospectus supplement, the accompanying prospectus, any related
free-writing prospectus and the documents incorporated by reference
herein or therein, including the sections titled “Risk
Factors,” “Cautionary Statement Regarding
Forward-Looking Statements” and the financial statements and
accompanying notes.
Business Overview
We are a clinical-stage biopharmaceutical
company committed to developing and commercializing
differentiated new generation medications that go beyond the
current standard of care for anxiety, depression and other central
nervous system (“CNS”) disorders. Our pipeline includes
three CNS product candidates, PH94B, PH10 and AV-101, each with a
differentiated potential mechanism of action, favorable safety
results observed in all clinical studies to date, and therapeutic
potential in multiple CNS indications. We are currently preparing
PH94B, an investigational pherine nasal spray, for Phase 3
clinical studies as a potential acute treatment of anxiety in
adults with social anxiety disorder (“SAD”), as well as
additional studies required to support our U.S. New Drug
Application (“ NDA”) for that indication should our
PH94B Phase 3 clinical development program for SAD be successful.
We are also planning for small exploratory Phase 2A studies in
adult patients experiencing other anxiety disorders. PH10, also
an investigational pherine nasal spray, has completed
a successful exploratory Phase 2A study for the treatment of major
depressive disorder (“MDD”). We are currently
conducting nonclinical studies in preparation for planned Phase 2B
clinical development of PH10 as a potential stand-alone treatment
for MDD. In several clinical studies, AV-101, our
N-methyl-D-aspartate receptor (“NMDAR”) antagonist
prodrug, was shown to be orally bioavailable and was
well-tolerated. Based on preclinical studies involving AV-101 alone
and in combination with probenecid, we are currently preparing to
conduct a Phase 1B clinical study of AV-101, in combination with
probenecid, necessary for potential future Phase 2A clinical
development of AV-101 for CNS indications involving the NMDAR.
Additionally, our wholly owned subsidiary, VistaGen Therapeutics,
Inc., a California corporation d/b/a VistaStem Therapeutics, Inc.
(“VistaStem”), has human pluripotent stem cell
(“hPSC”) technologies with potential to discover and
develop small molecule New Chemical Entities (NCEs) for our CNS pipeline or out-licensing, as well
as potential applications in the cell therapy (“CT”)
and regenerative medicine (“RM”) fields. Our goal is to
become a biopharmaceutical company that develops and commercializes
innovative CNS therapies for neuropsychiatry and neurology markets
where current treatments are inadequate to meet the needs of
millions of patients.
Our Product Candidates
PH94B
is an odorless synthetic rapid-onset pherine nasal spray with
therapeutic potential in neuropsychiatric indications involving
anxiety or phobia. Conveniently designed to be self-administered in
microgram-level doses without requiring systemic uptake and
distribution to achieve its anti-anxiety effects, our current Phase
3 clinical development program for PH94B is designed to further
demonstrate its potential as a fast-acting, non-sedating,
non-addictive acute treatment of anxiety in adults with SAD. We
believe PH94B also has potential to be developed as a novel
treatment for adjustment disorder, postpartum anxiety,
post-traumatic stress disorder, pre-procedural anxiety, panic and
other anxiety disorders. The U.S. Food and Drug Administration
(“FDA”) has granted Fast Track designation for
development of PH94B for the acute treatment of SAD.
PH10
is an odorless synthetic pherine nasal spray with potential to be a
fast-acting stand-alone treatment for neuropsychiatric indications
involving depression and suicidal ideation. Conveniently
self-administered in microgram-level doses without systemic
exposure, we are preparing to develop PH10 as a potential
rapid-onset, stand-alone treatment of MDD. With its rapid-onset
pharmacology, lack of systemic exposure at clinical doses
administered to-date and favorable safety results observed in all
clinical studies to date, we believe PH10 has potential to be a new
stand-alone treatment for several depression
disorders.
AV-101
(4-Cl-KYN) targets the NMDAR (N-methyl-D-aspartate receptor), an
ionotropic glutamate receptor in the brain. Abnormal NMDAR function
is associated with numerous CNS diseases and disorders. AV-101 is
an oral prodrug of 7-chloro-kynurenic acid (7-Cl-KYNA), which is a
potent and selective full antagonist of the glycine co-agonist site
of the NMDAR that inhibits the function of the NMDAR. However,
unlike ketamine and many other NMDAR antagonists, 7-Cl-KYNA is not
an ion channel blocker. At doses administered in all studies to
date, AV-101 has been observed to be orally bioavailable, well
tolerated and has not exhibited dissociative or hallucinogenic
psychological side effects or safety concerns. In light of these
and findings from preclinical studies, we believe that AV-101, in
combination with FDA-approved probenecid, has potential to become a
new oral treatment alternative for certain CNS indications
involving the NMDAR. We are currently preparing to evaluate AV-101
in combination with probenecid in a Phase 1B clinical study. The
FDA has granted Fast Track designation for development of AV-101 as
a potential adjunctive treatment for MDD and as a non-opioid
treatment for neuropathic pain (“NP”).
VistaStem’s
human pluripotent stem cell (hPSC) technology has potential
application in screening and development of novel, investigational
small molecule NCEs for our CNS pipeline or for out-licensing, as
well as for CT and RM.
Corporate
Information
VistaGen Therapeutics,
Inc., a Nevada corporation, is the parent of VistaGen Therapeutics,
Inc. (d/b/a VistaStem Therapeutics, Inc.), a wholly owned
California corporation founded in 1998. Our principal executive
offices are located at 343 Allerton Avenue, South San Francisco,
California 94080, and our telephone number is (650) 577-3600. Our
website address is www.vistagen.com.
The information contained on our website is not part of this
prospectus supplement or the accompanying prospectus. We have
included our website address as a factual reference and do not
intend it to be an active link to our website.
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THE
OFFERING
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Common
stock offered by us
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Shares of our
common stock having an aggregate offering price of up to
$75,000,000.
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Plan
of Distribution
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“At the
market offering” that may be made from time to time through
our sales agent, Jefferies. See “Plan of Distribution”
on page S-12 of this prospectus supplement.
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Use
of Proceeds
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Our management will
retain broad discretion regarding the allocation and use of the net
proceeds. We currently intend to use the net proceeds from the
offering for research, development and manufacturing and regulatory
expenses associated with continuing development of PH94B, PH10,
AV-101, and potential drug candidates to expand our CNS pipeline
and for other working capital and general corporate purposes. See
“Use of Proceeds” on
page S-10.
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Risk
Factors
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Investing in our
common stock involves a high degree of risk. See the information
contained under the heading “Risk Factors” beginning on
page S-3 of this prospectus supplement and under similar headings
in the accompanying prospectus and in the other documents that are
incorporated by reference herein and therein, including
specifically under “Item 1A: Risk Factors” and
elsewhere in our Annual Report on Form 10-K for the fiscal year
ended March 31, 2020 and in our Quarterly Reports on Form 10-Q
for the periods ended June 30, 2020, September 30, 2020 and
December 31, 2020.
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Nasdaq
Capital Market symbol
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“VTGN”
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RISK FACTORS
Investing in our
securities involves a high degree of risk. Before making an
investment decision, you should carefully consider the risks
described below and in our Annual Report on Form 10-K for
the fiscal year ended March 31, 2020 and our Quarterly Reports
on Form 10-Q for the periods ended June 30, 2020,
September 30, 2020 and December 31, 2020 incorporated by reference
into this prospectus supplement and the accompanying prospectus,
any amendment or update thereto reflected in our subsequent filings
with the SEC, any related free writing prospectus and all of the
other information contained in this prospectus supplement, the
accompanying prospectus, any related free writing prospectus and
the documents incorporated by reference herein or therein,
including our financial statements and related notes. If any of
these risks is realized, our business, financial condition, results
of operations and prospects could be materially and adversely
affected. In that event, the trading price of our common stock
could decline, and you could lose part or all of your investment.
Additional risks and uncertainties that are not yet identified or
that we currently believe to be immaterial may also materially harm
our business, operating results and financial condition and could
result in a complete loss of your investment.
The COVID-19 pandemic has adversely impacted, and may continue to
adversely impact our business.
Beginning in late
2019, a new strain of coronavirus (“COVID-19”) spread
across the world, and the outbreak has since been declared a
pandemic by the World Health Organization. The U.S. Secretary of
Health and Human Services has also declared a public health
emergency in the United States in response to the outbreak. Despite
the recent administration of vaccines designed to combat the
pandemic, considerable uncertainty still surrounds the COVID-19
pandemic and its potential effects, and the extent of and
effectiveness of responses taken on international, national and
local levels. Measures taken to limit the impact of COVID-19,
including shelter-in-place orders, social distancing measures,
travel bans and restrictions, and business and government shutdowns
have already resulted in significant negative economic impacts on a
global basis.
As the COVID-19
pandemic continues to evolve, we cannot at this time fully predict
the effects of these conditions on our operations. Uncertainties
remain as to the duration of the pandemic, the success of
treatments and vaccines designed to combat the pandemic, and the
length and scope of the travel restrictions and business closures
imposed by the governments of impacted countries and localities.
The continued COVID-19 pandemic, or another highly transmissible
and pathogenic infectious disease, may lead to the implementation
of further responses, including additional travel restrictions,
government-imposed quarantines or stay-at-home orders, and other
public health safety measures, which may result in further
disruptions to our business and operations. The COVID-19 pandemic
has impacted our business and may continue to do so as the pandemic
persists. Additionally, future outbreaks may have several adverse
effects on our business, results of operations and financial
condition.
●
Delayed product
development: We have faced, and may continue to face,
delays and other disruptions to our ongoing clinical development
programs for PH94B, PH10 and AV-101 due to the ongoing COVID-19
pandemic. In addition, regulatory oversight and actions regarding
our products may be disrupted or delayed in regions impacted by
COVID-19, including the United States and elsewhere, which may
impact review and approval timelines for products in development.
Although we remain invested in continuing our clinical development
programs for our current product candidates, our research and
development efforts may be impacted if our employees, or the
employees of our contract research and development organizations
(“CROs”) or our third-party contract manufacturer(s)
(“CMOs”) are advised or required to work remotely or at
limited capacity as part of social distancing measures or as a
result of illness related to the COVID-19 pandemic. Additionally,
social distancing measures, stay-at-home orders and other
governmental restrictions designed to combat the COVID-19 pandemic
or any resurgence may impair our ability to conduct future clinical
trials in a timely manner.
●
Negative impacts on our
suppliers and employees: COVID-19 has impacted, and COVID-19
or another highly transmissible and pathogenic infectious disease,
may continue to impact the health of our employees, contractors or
suppliers, reduce the availability of our workforce or those of
companies with which we do business, including our CROs and CMOs,
divert our attention toward succession planning, or create
disruptions in our supply or distribution networks. Since the
beginning of the COVID-19 pandemic, we have experienced delays of
the delivery of supplies of active pharmaceutical product
(“API”) required to continue development of PH94B and
PH10. Although our supply of raw materials and API remains
sufficiently operational, we may experience adverse effects of such
events in the future, which may result in a significant, material
disruption to clinical development programs and our operations.
Additionally, having shifted to remote working arrangements, we
also face a heightened risk of cybersecurity attacks or data
security incidents and are more dependent on internet and
telecommunications access and capabilities.
COVID-19 has also
created significant disruption and volatility in national, regional
and local economies and markets. Uncertainties related to, and
perceived or experienced negative effects from COVID-19, may cause
significant volatility or decline in the trading price of our
securities, capital markets conditions and general economic
conditions. Our future results of operations and liquidity could be
adversely impacted by supply chain disruptions and operational
challenges faced by our CROs, CMOs and other contractors. The
continued COVID-19 pandemic, or another highly transmissible
and pathogenic infectious disease, could result in a
widespread health crisis that could adversely affect the economies
and financial markets of many countries, resulting in a further
economic downturn or a global recession. Such events may limit or
restrict our ability to access capital on favorable terms, or at
all, lead to consolidation that negatively impacts our business,
weaken demand, increase competition, cause us to reduce our capital
spend further, or otherwise disrupt our business or make it more
difficult to implement our strategic plans.
We may be required to raise additional financing by issuing new
securities with terms or rights superior to those of our existing
securityholders, which could adversely affect the market price of
shares of our common stock and our business.
We will require
additional financing to fund future operations, including our
research and development activities for our product candidates and,
if such efforts are successful, commercialization of our product
candidates. We may not be able to obtain financing on favorable
terms, if at all. If we raise additional funds by issuing equity
securities, the percentage ownership of our current stockholders
will be reduced, and the holders of the new equity securities may
have rights superior to those of our existing security holders,
which could adversely affect the market price of our common stock
and the voting power of shares of our common stock. If we raise
additional funds by issuing debt securities, the holders of these
debt securities would similarly have some rights senior to those of
our existing securityholders, and the terms of these debt
securities could impose restrictions on operations and create a
significant interest expense for us, which could have a materially
adverse effect on our business.
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 accordingly may experience different levels
of dilution and different outcomes in their investment results. We
will have discretion, subject to market demand and the terms of the
sale agreement, to vary the timing, prices and number of shares
sold in this offering. In addition, subject to the final
determination by our board of directors or any restrictions we may
place in any applicable placement notice, 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.
Purchasers will experience immediate dilution in the book value per
share of the common stock purchased in the offering.
The shares sold in
this offering, if any, will be sold from time to time at various
prices. However, we expect that the offering price of our common
stock will be substantially higher than the net tangible book value
per share of our outstanding common stock. After giving effect to
the sale of shares of our common stock in the aggregate amount of
$75,000,000 at an assumed offering price of $2.33 per share, the
last sale price of our common stock on May 12, 2021 on The
Nasdaq Capital Market, and after deducting commissions and
estimated offering expenses, our as adjusted net tangible book
value as of December 31, 2021 would have been approximately
$166.3 million or approximately $0.97 per share. This
represents an immediate increase in net tangible book value of
approximately $0.29 per share to our existing stockholders and an
immediate dilution in as adjusted net tangible book value of
approximately $1.36 per share to purchasers of our common stock in
this offering. See “Dilution” for more
information.
In addition to this
offering, subject to market conditions and other factors, we may
pursue additional equity financings in the future, including future
public offerings or future private placements of equity securities
or securities convertible into or exchangeable for equity
securities at prices that may be higher or lower than the price per
share in this offering. Further, the exercise of outstanding
options or warrants could result in further dilution to investors
and any additional shares issued in connection with acquisitions,
collaborations, licensing transactions or other similar
transactions will result in dilution to investors. In addition, the
market price of our common stock could fall as a result of resales
of any of these shares of common stock due to an increased number
of shares available for sale in the market.
Sales of a substantial number of shares of our common stock, or the
perception that such sales may occur, may adversely impact the
price of our common stock.
Sales of a
substantial number of shares of our common stock in the public
market could occur at any time. These sales, or the perception that
such sales may occur, may adversely impact the price of our common
stock, even if there is no relationship between such sales and the
performance of our business. As of December 31, 2020, we had
138,664,472 shares of common stock outstanding, as well as
outstanding options to purchase an aggregate of 13,718,088 shares
of our common stock at a weighted average exercise price of $1.25
per share, up to 50,199,681 shares of common stock issuable upon
conversion of outstanding shares of our preferred stock, up to
3,776,436 shares of common stock reserved for issuance as
payment of accrued dividends on outstanding shares of our Series B
10% Convertible Preferred Stock, and outstanding warrants to
purchase up to an aggregate of 24,314,052 shares of our common
stock at a weighted average exercise price of $1.59 per share. The
exercise and/or conversion of such outstanding derivative
securities may result in further dilution of your
investment.
Our management will have broad discretion in the use of the net
proceeds from this offering and may allocate such net proceeds in
ways that you and other stockholders may not approve.
Our management will
have broad discretion in the use of the net proceeds from this
offering, including for any of the purposes described in the
section titled “Use of
Proceeds,” and you will not have the opportunity as
part of your investment decision to assess whether the net proceeds
are being used appropriately. Because of the number and variability
of factors that will determine our use of the net proceeds from
this offering, their ultimate use may vary substantially from their
currently intended use. The failure of our management to use these
funds effectively could harm our business. Pending their use, we
may invest the net proceeds from this offering in short- and
intermediate-term, interest-bearing obligations, investment-grade
instruments, certificates of deposit or direct or guaranteed
obligations of the U.S. government. These investments may not yield
a favorable return to our stockholders.
Because we have no current plans to pay cash dividends on our
common stock for the foreseeable future, you may not receive any
return on investment unless you sell your common stock for a price
greater than that which you paid for it.
We intend to retain
future earnings, if any, for future operations and expansion of our
business and have no current plans to pay any cash dividends for
the foreseeable future. The declaration, amount and payment of any
future dividends on shares of common stock will be at the sole
discretion of our Board of Directors. Our Board of Directors may
take into account general and economic conditions, our financial
condition and results of operations, our available cash and current
and anticipated cash needs, capital requirements, contractual,
legal, tax and regulatory restrictions, implications on the payment
of dividends by us to our stockholders or by our subsidiaries to us
and such other factors as our Board of Directors may deem relevant.
In addition, our ability to pay dividends may be limited by
covenants in connection with any indebtedness we or our
subsidiaries may incur. As a result, you may not receive any return
on an investment in our common stock unless you sell our common
stock for a price greater than that which you paid for
it.
Our ability to utilize our net operating loss carryforwards and
certain other tax attributes may be limited.
As of March 31,
2020, we had U.S. federal and state net operating loss
carryforwards of approximately $125.1 million and $64.1 million,
respectively, and U.S. federal and state tax credit carryforwards
of approximately $2.1 and $1.2 million, respectively, and we have
generated significant losses and credits after March 31, 2020.
Under legislation enacted in 2017, informally titled the Tax Cuts
and Jobs Act of 2017 (the “Tax Act”), as modified by
the Coronavirus Aid, Relief, and Economic Security Act, federal net
operating loss carryforwards generated in taxable years beginning
after December 31, 2017 may be carried forward indefinitely but, in
the case of taxable years beginning after December 31, 2020, may
only be used to offset 80% of our taxable income, if any, annually.
Similar rules may apply under state tax laws that may suspend or
otherwise limit utilization of net operating losses, which could
accelerate or permanently increase state taxes owed. For example,
California enacted A.B. 85 which imposes limits on the usability of
California net operating losses and certain tax credits in taxable
years beginning after 2019 and before 2023. In addition, our
ability to utilize our federal net operating loss and tax credit
carryforwards may be limited under Sections 382 and 383 of the
Code. The limitations apply if we experience an “ownership
change,” which is generally defined as a greater than 50
percentage point change (by value) in the ownership of our equity
by certain stockholders over a rolling three-year period. We have
not assessed whether such an ownership change has previously
occurred nor whether this offering will give rise to an ownership
change. If we have experienced an ownership change at any time
since our incorporation, we may already be subject to limitations
on our ability to utilize all or a portion of our existing net
operating losses and other tax attributes to offset taxable income.
In addition, future changes in our stock ownership (including as a
result of this offering), which may be outside of our control, may
trigger an ownership change and, consequently, the limitations
under Sections 382 and 383 of the Code. Similar provisions of state
tax law may also apply to limit the use of our state net operating
loss and tax credit carryforwards. As a result, if or when we earn
net taxable income, our ability to use our pre-change net operating
loss carryforwards and other tax attributes to offset such taxable
income may be subject to limitations, which could adversely affect
our future cash flows.
If securities or industry analysts do not publish research or
publish inaccurate or unfavorable research about our business, our
stock price and trading volume could decline.
The trading market
for our common stock depends in part on the research and reports
that securities or industry analysts publish about us or our
business. We currently have research coverage by three securities
and industry analysts. If one or more of the analysts who covers us
downgrades our stock or publishes inaccurate or unfavorable
research about our business, our stock price would likely decline.
If one or more of these analysts ceases coverage of us or fails to
publish reports on us regularly, demand for our stock could
decrease, which could cause our stock price and trading volume to
decline.
The market price of our common stock may be adversely affected by
market conditions affecting the stock markets in general, including
price and trading fluctuations on Nasdaq.
Market conditions
may result in volatility in the level of, and fluctuations in,
market prices of stocks generally and, in turn, our common stock
and sales of substantial amounts of our common stock in the market,
in each case being unrelated or disproportionate to changes in our
operating performance. A weak global economy or other
circumstances, such as changes in tariffs and trade, could also
contribute to extreme volatility of the markets, which may have an
effect on the market price of our common stock.
The requirements of being a
public company, including compliance with the reporting
requirements of the Sarbanes-Oxley Act, may strain our
resources, increase our costs and distract management, and we may
be unable to comply with these requirements in a timely or
cost-effective manner.
We are required, pursuant to Section 404 of the Sarbanes-Oxley
Act of 2002, or Section 404, to furnish a report by management
on, among other things, the effectiveness of our internal control
over financial reporting. We are required to disclose any material
weaknesses identified by our management in our internal control
over financial reporting. As a non-accelerated filer, we avail
ourselves of the exemption from the requirement that our
independent registered public accounting firm attest to the
effectiveness of our internal control over financial reporting
under Section 404(b). However, we may no longer avail
ourselves of this exemption if and when we cease to be a
non-accelerated filer. When our independent registered public
accounting firm is required to undertake an assessment of our
internal control over financial reporting, the cost of our
compliance with Section 404 will correspondingly increase. If
required, our compliance with Section 404(b) would require
that we incur substantial accounting expense and expend significant
management time on compliance-related issues. Moreover, if we are
not able to comply with the requirements of Section 404
applicable to us in a timely manner, or if we or our independent
registered public accounting firm identifies deficiencies in our
internal control over financial reporting that are deemed to be
material weaknesses, the market price of our stock could decline
and we could be subject to sanctions or investigations by the SEC
or other regulatory authorities, which would require additional
financial and management resources.
We have identified material weaknesses in our internal control over
financial reporting, and our business and stock price may be
adversely affected if we do not adequately address those weaknesses
or if we have other material weaknesses or significant deficiencies
in our internal control over financial reporting.
We
have identified material weaknesses in our internal control over
financial reporting and have taken steps to remediate them. In
particular, upon concluding that (i) the size of our staff did not
permit appropriate segregation of duties to (a) permit appropriate
review of accounting transactions and/or accounting treatment by
multiple qualified individuals and (b) prevent one individual from
overriding the internal control system by initiating, authorizing
and completing all transactions; and (ii) our accounting software
did not prevent erroneous or unauthorized changes to previous
reporting periods and/or could be adjusted so as to not provide an
adequate auditing trail of entries made in the accounting software,
we have begun to address these material weaknesses by retaining
additional accounting staff to permit appropriate review of
accounting transactions and/or accounting treatment by multiple
qualified individual and implementing state-of-the-art accounting
software to prevent erroneous or unauthorized changes to previous
reporting periods and/or adjustments and to provide an adequate
auditing trail of entries made in the accounting
software.
The
existence of one or more material weaknesses or significant
deficiencies could result in errors in our financial statements,
and substantial costs and resources may be required to rectify any
internal control deficiencies. If we cannot produce reliable
financial reports, investors could lose confidence in our reported
financial information causing our stock price to decline, we may be
unable to obtain additional financing to operate and expand our
business and our business and financial condition could be
harmed.
We require additional financing to execute our business plan and
continue to operate as a going concern.
Our
audited consolidated financial statements for the year ended March
31, 2020 incorporated by reference into this prospectus supplement
were prepared assuming we will continue to operate as a going
concern, although we and our auditors have indicated that our
continuing losses and negative cash flows from operations raise
substantial doubt about our ability to continue as such. Because we
continue to experience net operating losses, our ability to
continue as a going concern is subject to our ability to obtain
necessary funding from outside sources, including obtaining
additional funding from this offering as well as future sales of
our securities or potentially obtaining loans and grant awards from
financial institutions and/or government agencies where possible.
Our continued net operating losses increase the difficulty in
completing such sales or securing alternative sources of funding,
and there can be no assurances that we will be able to obtain any
future funding on favorable terms or at all. If we are unable to
obtain sufficient financing from the sale of our securities or from
alternative sources, we may be required to reduce, defer, or
discontinue certain or all of our research and development
activities or we may not be able to continue as a going
concern.
During
the nine months ended December 31, 2020, we generated approximately
$114.8 million in net cash proceeds from financing transactions and
partnering arrangements. As of December 31, 2020, we had cash and
cash equivalents of approximately $104.3 million, which we believe
is sufficient to fund our planned operations for well beyond the
twelve months following the issuance of the financial statements
incorporated by reference into this prospectus supplement.
Nevertheless, we have not yet developed products that generate
recurring revenue and, assuming successful completion of our
planned clinical and nonclinical programs, we will need to invest
substantial additional capital resources to commercialize any of
them.
Further,
we have no current source of revenue to sustain our present
activities, and we do not expect to generate revenue until, and
unless, we (i) out-license or sell a product candidate to a
third-party, (ii) enter into additional license arrangements
involving our stem cell technology, or (iii) obtain approval from
the FDA or other regulatory authorities and successfully
commercialize, on our own or through a future collaboration, one or
more of our product candidates.
As
the outcome of our ongoing research and development activities,
including the outcome of future anticipated clinical trials, is
highly uncertain, we cannot reasonably estimate the actual amounts
necessary to successfully complete the development and
commercialization of our product candidates, on our own or in
collaboration with others. As with prior periods, we will continue
to incur costs associated with other development programs for
PH94B, PH10 and AV-101. In addition, other unanticipated costs may
arise. As a result of these and other factors, we will need to seek
additional capital to meet our future operating requirements,
including capital necessary to develop, obtain regulatory approval
for, and to commercialize our product candidates. Raising funds in
the current economic environment may present additional challenges.
Even if we believe we have sufficient funds for our current or
future operating plans, we may seek additional capital if market
conditions are favorable or if we have specific strategic
considerations.
Our
future capital requirements depend on many factors,
including:
●
the
number and characteristics of the product candidates we
pursue;
●
the
scope, progress, results and costs of researching and developing
our product candidates, and conducting preclinical and clinical
studies;
●
the
timing of, and the costs involved in, obtaining regulatory
approvals for our product candidates;
●
the
cost of commercialization activities if any of our product
candidates are approved for sale, including marketing, sales and
distribution costs;
●
the
cost of manufacturing our product candidates and any products we
successfully commercialize;
●
our
ability to establish and maintain strategic partnerships, licensing
or other collaborative arrangements and the financial terms of such
agreements;
●
market
acceptance of our product candidates;
●
the
effect of competing technological and market
developments;
●
our
ability to obtain government funding for our research and
development programs;
●
the
costs involved in obtaining, maintaining and enforcing patents to
preserve our intellectual property;
●
the
costs involved in defending against such claims that we infringe
third-party patents or violate other intellectual property rights
and the outcome of such litigation;
●
the
timing, receipt and amount of potential future licensee fees,
milestone payments, and sales of, or royalties on, our future
products, if any; and
●
the
extent to which we may acquire or invest in additional businesses,
product candidates and technologies.
S-7
Any
additional fundraising efforts will divert certain members of our
management team from their day-to-day activities,
which may adversely affect our ability to develop and commercialize
our product candidates. We cannot guarantee that future financing
will be available in sufficient amounts, in a timely manner, or on
terms acceptable to us, if at all. The terms of any future
financing may adversely affect the holdings or the rights of our
stockholders and the issuance of additional securities, whether
equity or debt, by us, or the possibility of such issuance, may
cause the market price of our shares to decline. The sale of
additional equity securities and the conversion, exchange or
exercise of certain of our outstanding securities will dilute all
of our stockholders. The incurrence of debt could result in
increased fixed payment obligations and we could be required to
agree to certain restrictive covenants, such as limitations on our
ability to incur additional debt, limitations on our ability to
acquire, sell or license intellectual property rights and other
operating restrictions that could adversely impact our ability to
conduct our business. We could also be required to seek funds
through arrangements with collaborative partners or otherwise at an
earlier stage than otherwise would be desirable and we may be
required to relinquish rights to some of our technologies or
product candidates or otherwise agree to terms unfavorable to us,
any of which may have a material adverse effect on our business,
operating results and prospects.
If
we are unable to obtain additional funding on a timely basis and on
acceptable terms, we may be required to significantly curtail,
delay or discontinue one or more of our research or product
development programs or the commercialization of any product
candidate or be unable to continue or expand our operations or
otherwise capitalize on our business opportunities, as desired,
which could materially affect our business, financial condition and
results of operations.
CAUTIONARY
STATEMENT REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus
supplement contains forward-looking statements that involve
substantial risks and uncertainties. All statements contained in
this prospectus supplement and the accompanying prospectus, other
than statements of historical facts, are forward-looking statements
including statements regarding our strategy, future operations,
future financial position, future revenue, projected costs,
prospects, plans, objectives of management and expected market
growth. These statements involve known and unknown risks,
uncertainties and other important factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements.
The words
“anticipate,” “believe,”
“estimate,” “expect,” “intend,”
“may,” “plan,” “predict,”
“project,” “target,”
“potential,” “will,” “would,”
“could,” “should,” “continue,”
and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. These forward-looking statements include,
among other things, statements about:
●
the impact of the
COVID-19 pandemic, efforts to contain the pandemic and resulting
economic downturn on our operations and financial
condition;
●
the availability of
capital to satisfy our working capital requirements;
●
the accuracy of our
estimates regarding expenses, future revenues and capital
requirements;
●
our plans to
develop and commercialize our any of our current product
candidates;
●
our ability to
initiate and complete our clinical trials and to advance our
product candidates into additional clinical trials, including
pivotal clinical trials, and successfully complete such clinical
trials;
●
regulatory
developments in the United States and foreign
countries;
●
the performance of
our third-party contractors involved with the manufacture and
production of our drug candidates for nonclinical and clinical
development activities, contract research organizations and other
third-party nonclinical and clinical development collaborators and
regulatory service providers;
●
our ability to
obtain and maintain intellectual property protection for our core
assets;
●
the size of the
potential markets for our product candidates and our ability to
serve those markets;
●
the rate and degree
of market acceptance of our product candidates for any indication
once approved;
●
the success of
competing products and product candidates in development by others
that are or become available for the indications that we are
pursuing;
●
the loss of key
scientific, clinical and nonclinical development, and/or management
personnel, internally or from one of our third-party
collaborators;
●
our ability to
comply with Nasdaq continued listing standards;
●
our ability to
continue as a going concern; and
●
other risks and
uncertainties, including those described under Item 1A,
“Risk Factors,”
in our Annual Report on Form 10-K for the fiscal year ended March
31, 2020, and those described under Part II, Item 1A,
“Risk Factors,”
in our Quarterly Reports on Form 10-Q for the quarters ended June
30, 2020, September 30, 2020 and December 31, 2020, which risk
factors are incorporated herein by reference.
These
forward-looking statements are only predictions and we may not
actually achieve the plans, intentions or expectations disclosed in
our forward-looking statements, so you should not place undue
reliance on our forward-looking statements.
Actual results or events could differ materially from the
plans, intentions and expectations disclosed in the forward-looking
statements we make. We have based these forward-looking statements
largely on our current expectations and projections about future
events and trends that we believe may affect our business,
financial condition and operating results. We have included
important factors in the cautionary statements included in this
prospectus supplement, as well as certain information incorporated
by reference into this prospectus supplement and the accompanying
prospectus, that could cause actual future results or events to
differ materially from the forward-looking statements that we make.
Our forward-looking statements do not reflect the potential impact
of any future acquisitions, mergers, dispositions, joint ventures
or investments we may make.
You should read
this prospectus supplement and the accompanying prospectus with the
understanding that our actual future results
may be materially different from what we expect. We do
not assume any obligation to update any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
USE OF PROCEEDS
We may issue and
sell shares of our common stock having aggregate sales proceeds of
up to $75.0 million 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 our Sales Agreement with Jefferies.
We currently intend
to use the net proceeds from the offering primarily for research,
development and manufacturing and regulatory expenses associated
with continuing development of PH94B, PH10, AV-101, and potential
drug candidates to expand our CNS pipeline and for other working
capital and general corporate purposes.
Pending other uses,
we intend to invest our proceeds from this offering in short-term
investments or hold them as cash. We cannot predict whether the
proceeds invested will yield a favorable return. Our management
will have broad discretion in the use of the net proceeds from this
offering, and investors will be relying on the judgment of our
management regarding the application of the net
proceeds.
S-10
DILUTION
Purchasers
of our common offered by this prospectus supplement and the
accompanying prospectus will suffer immediate and substantial
dilution in the net tangible book value per share of common stock.
Net tangible book value is total assets minus the sum of
liabilities and intangible assets. Net tangible book value per
share is net tangible book value divided by the total number of
shares of common stock outstanding. As of December 31, 2020, our
net tangible book value was approximately $93.8 million, or
approximately $0.68 per share.
After giving effect to the assumed sale of
32,188,841 shares of common stock in the aggregate amount of $75.0
million at an assumed public offering price of $2.33 per share, the
last reported price of our common stock on The Nasdaq Capital
Market on May 12, 2021, after deducting the underwriting
discount and commissions, and estimated offering expenses payable
by us, our pro forma net tangible book
value as of December 31, 2020 would have been approximately $166.3
million or approximately $0.97 per share. This amount represents an
immediate increase in net tangible book value of approximately
$0.29 per share to existing stockholders and an immediate dilution
in net tangible book value of approximately $1.36 per share to
purchasers of our common stock in this
offering.
The following table illustrates the dilution in net
tangible book value per share to new investors:
|
Assumed public offering price per
share:
|
|
$2.33
|
|
Net tangible book
value per share as of December 31, 2020
|
$0.68
|
|
|
Increase in pro
forma, net tangible book value per share after this
offering
|
0.29
|
|
|
Pro forma net
tangible book value per share after this offering
|
|
0.97
|
|
Dilution in pro
forma net tangible book value per share to new investors in this
offering
|
|
$1.36
|
The foregoing discussion and table do not take
into account further dilution
to new investors that could occur upon the exercise of outstanding
options or warrants having a per share exercise price less than the
assumed public offering price in this offering. To the extent that
we raise additional capital through the sale of equity or
convertible debt securities after this offering, the issuance of
those securities could result in further dilution to our
stockholders.
The above
discussion and table are based on 138,664,472 shares of common
stock outstanding as of December 31, 2020 and excludes the
following securities:
●
46,000,000
shares of common stock issued after December 31, 2020 pursuant to
the conversion of all outstanding shares of our Series D Preferred
Stock;
●
750,000 shares of common stock reserved for
issuance upon conversion of 500,000 shares of our Series A Preferred
Stock held by one institutional investor and one accredited
individual investor;
●
1,131,669 shares of common stock reserved
for issuance upon conversion of 1,131,669 shares of our Series B 10%
Convertible Preferred held by one institutional investor and
3,776,436 shares of common stock
reserved for issuance as payment of accrued dividends on
outstanding shares of our Series B 10% Convertible
Preferred;
●
2,318,012 shares of common stock reserved
for issuance upon conversion of 2,318,012 shares of our Series C
Convertible Preferred held by one institutional
investor;
●
24,314,052 shares of common stock that have
been reserved for issuance upon exercise of outstanding warrants,
with a weighted average exercise price of $1.59 per share;
●
13,718,088 shares of common stock reserved
for issuance upon exercise of outstanding stock options under our
2019 Omnibus Equity Incentive Plan and our 2016 Equity incentive
Plan, with a weighted average exercise price of $1.25 per
share;
●
3,051,248
shares of common stock reserved for future issuance in connection
with future grants under our 2019 Omnibus Equity Incentive Plan;
and
●
941,875 shares of
common stock reserved for future issuance in connection with the
2019 ESPP.
S-11
PLAN OF DISTRIBUTION
We have entered
into a Sales Agreement with Jefferies, under which we may offer and
sell up to $75.0 million of our
shares of common stock from time to time through Jefferies acting
as agent. Sales of our shares of common stock, if any, under this
prospectus supplement and the accompanying prospectus will be made
by any method that is deemed to be an “at the market
offering” as defined in Rule 415(a)(4) under the
Securities Act.
Each time we wish
to issue and sell shares of common stock under the Sales Agreement,
we will notify Jefferies of the number of shares to be issued, the
dates on which such sales are anticipated to be made, any
limitation on the number of shares to be sold in any one day and
any minimum price below which sales may not be made. Once we have
so instructed Jefferies, unless Jefferies declines to accept the
terms of such notice, Jefferies has agreed to use its commercially
reasonable efforts consistent with its normal trading and sales
practices to sell such shares up to the amount specified on such
terms. The obligations of Jefferies under the Sales Agreement to
sell our shares of common stock are subject to a number of
conditions that we must meet.
The settlement of
sales of shares between us and Jefferies is generally anticipated
to occur on the second trading day following the date on which the
sale was made. Sales of our shares of common stock as contemplated
in this prospectus supplement will be settled through the
facilities of The Depository Trust Company or by such other means
as we and Jefferies may agree upon. There is no arrangement for
funds to be received in an escrow, trust or similar
arrangement.
We will pay
Jefferies a commission equal to 3.0% of the aggregate gross
proceeds we receive from each sale of our shares of common stock.
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. In addition, we have agreed to reimburse Jefferies for
the fees and disbursements of its counsel, payable upon execution
of the sales agreement, in an amount not to exceed $50,000, in
addition to certain ongoing disbursements of its legal counsel,
unless we and Jefferies otherwise agree. We estimate that the total
expenses for the offering, excluding any commissions or expense
reimbursement payable to Jefferies under the terms of the Sales
Agreement, will be approximately $250,000. The remaining sale
proceeds, after deducting any other transaction fees, will equal
our net proceeds from the sale of such shares.
Jefferies will
provide written confirmation to us before the open on the Nasdaq
Capital Market on the day following each day on which shares of
common stock are sold under the sales agreement. Each confirmation
will include the number of shares sold on that day, the aggregate
gross proceeds of such sales and the proceeds to us.
In connection with
the sale of the shares of common stock on our behalf, Jefferies
will be deemed to be an “underwriter” within the
meaning of the Securities Act, and the compensation of Jefferies
will be deemed to be underwriting commissions or discounts. We have
agreed to indemnify Jefferies against certain civil liabilities,
including liabilities under the Securities Act. We have also agreed
to contribute to payments Jefferies may be required to make in
respect of such liabilities.
The offering of our
shares of common stock pursuant to the Sales Agreement will
terminate upon the earlier of (i) the sale of all shares of common
stock subject to the Sales Agreement and (ii) the termination of
the Sales Agreement as permitted therein.
This summary of the
material provisions of the Sales Agreement does not purport to be a
complete statement of its terms and conditions. A copy of the sales
agreement will be filed as an exhibit to a current report on Form
8-K filed under the Securities Exchange Act of 1934, as amended, or
the Exchange Act, and incorporated by reference in this prospectus
supplement.
Jefferies and its
affiliates may in the future provide various investment banking,
commercial banking, financial advisory and other financial services
for us and our affiliates, for which services they may in the
future receive customary fees. In the course of its business,
Jefferies may actively trade our securities for its own account or
for the accounts of customers, and, accordingly, Jefferies may at
any time hold long or short positions in such
securities.
A prospectus
supplement and the accompanying prospectus in electronic format may
be made available on a website maintained by Jefferies, and
Jefferies may distribute the prospectus supplement and the
accompanying prospectus electronically.
S-12
LEGAL MATTERS
Certain legal
matters in connection with this offering will be passed upon for us
by Latham & Watkins LLP, Chicago, Illinois. Jefferies LLC is
being represented in connection with this offering by Cooley LLP,
New York, New York. The validity of the securities offered hereby
will be passed upon for us by Woodburn and Wedge, Reno,
Nevada.
EXPERTS
OUM & Co. LLP,
our independent registered public accounting firm, has audited our
consolidated financial statements included in our Annual Report on
Form 10-K for the year ended March 31, 2020, as set forth in their
report (the “Audit Report”), which is incorporated by
reference in this prospectus. The Audit Report for VistaGen
Therapeutics, Inc. as of March 31, 2020 includes an explanatory
paragraph about the existence of substantial doubt concerning its
ability to continue as a going concern. Our financial statements
are incorporated by reference in reliance on OUM & Co.
LLP’s report, given on their authority as experts in
accounting and auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We have filed with
the SEC a registration statement on Form S-3 under the Securities
Act with respect to the securities covered by this prospectus
supplement. This prospectus supplement, which is a part of the
registration statement, does not contain all of the information set
forth in the registration statement or the exhibits and schedules
filed therewith. For further information with respect to us and the
securities covered by this prospectus, please see the registration
statement and the exhibits filed with the registration statement.
The SEC maintains an Internet website that contains reports, proxy
and information statements and other information regarding
registrants that file electronically with the SEC. The address of
the website is www.sec.gov.
We are subject to
the information and periodic reporting requirements of the Exchange
Act and, in accordance therewith, we file periodic reports, proxy
statements and other information with the SEC. Such periodic
reports, proxy statements and other information are available free
of charge at our website, www.vistagen.com, as soon as reasonably
practicable after such material is electronically filed with, or
furnished to, the SEC. Our website and the information contained on
that site, or connected to that site, are not incorporated into and
are not a part of this prospectus supplement.
S-13
INCORPORATION BY REFERENCE
The following
documents filed by us with the SEC are incorporated by reference in
this prospectus supplement:
●
Our
Annual Report on Form 10-K for the fiscal year ended March 31,
2020, filed with the SEC on June 29, 2020;
●
The
information specifically incorporated by reference into Part III of
our Annual Report on Form 10-K for the fiscal year ended March 31,
2020 from our Definitive Proxy Statement on Schedule 14A,
filed with the SEC on July 27, 2020;
●
Our
Quarterly Reports on Form 10-Q for the quarters ended June 30,
2020, September 30, 2020 and December 31, 2020, filed with the SEC
on August 13, 2020, November 12, 2020 and February 11, 2021,
respectively;
●
Our
Current Reports on Form 8-K, filed with the SEC on April 3, 2020,
April 27, 2020, June 26, 2020, August 6, 2020, September 18, 2020
(solely with respect to the information disclosed under Item 5.07),
October 13, 2020 (solely with respect to the information disclosed
under Item 3.01), December 1, 2020, December 22, 2020 (other than
with respect to the information disclosed under Item 7.01), January
6, 2021, February 2, 2021, March 5, 2021, April 26, 2021, April 27,
2021 and May 4, 2021; and
●
The
description of the Company’s common stock in the
Company’s Registration Statement on Form S-3 (File No.
333-254299) filed with the SEC on March 15, 2021.
We also incorporate
by reference any future filings (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 unless such Form
8-K expressly provides to the contrary) made with the SEC pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, until we
file a post-effective amendment that indicates the termination of
the offering of the securities made by this prospectus supplement
and accompanying prospectus, which will become a part of this
prospectus supplement and accompanying prospectus from the date
that such documents are filed with the SEC. Information in such
future filings updates and supplements the information provided in
this prospectus supplement and accompanying prospectus. Any
statements in any such future filings will automatically be deemed
to modify and supersede any information in any document we
previously filed with the SEC that is incorporated or deemed to be
incorporated herein by reference to the extent that statements in
the later-filed document modify or replace such earlier
statements.
We will provide to
each person, including any beneficial owner, to whom a prospectus
is delivered, a copy of any or all of the information that has been
incorporated by reference in the prospectus but not delivered with
the prospectus. You may request a copy of these filings, excluding
the exhibits to such filings which we have not specifically
incorporated by reference in such filings, at no cost, by writing
to or calling us at:
VistaGen
Therapeutics, Inc.
343 Allerton
Avenue
South San
Francisco, California 94080
(650)
577-3600
This prospectus
supplement and the accompanying prospectus is part of a
registration statement we filed with the SEC. You should only rely
on the information or representations contained in this prospectus
supplement and the accompanying prospectus. We have not authorized
anyone to provide information other than that provided in this
prospectus supplement and the accompanying prospectus. We are not
making an offer of the securities in any state where the offer is
not permitted. You should not assume that the information in this
prospectus supplement and the accompanying prospectus is accurate
as of any date other than the date on the front of the
document.
PROSPECTUS
$250,000,000
COMMON STOCK
PREFERRED STOCK
WARRANTS
UNITS
From time to time, we may offer and sell, in one or more offerings,
up to approximately $250 million of any combination of the
securities described in this prospectus. We may also offer
securities as may be issuable upon conversion, repurchase, exchange
or exercise of any securities registered hereunder, including
applicable anti-dilution provisions, if any. Any warrants sold
hereunder may be exercisable for shares of our common stock, shares
of our preferred stock and/or units. Any units sold hereunder will
represent an interest in two or more other securities, which may or
may not be separable from one another. The shares of our
common stock that may become issuable from time to time upon the
exercise of our Series A1 Warrants and upon conversion of shares of
Series D Preferred (each as defined herein) are also being offered
pursuant to this prospectus.
This prospectus provides a general description of the securities we
may offer from time to time. Each time we offer securities, we will
provide 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 an offering.
The prospectus supplement and any related free writing prospectus
may also add, update or change information contained in this
prospectus. You should carefully read this prospectus, the
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.
Our
common stock is listed on the Nasdaq Capital Market under the
symbol “VTGN.” On March
12, 2021, the closing price of our common stock on the
Nasdaq Capital Market was $2.35
per share.
We may offer and sell our securities to or through one or more
agents, underwriters, dealers or other third parties or directly to
one or more purchasers on a continuous or delayed basis. If agents,
underwriters or dealers are used to sell our securities, we will
name them and describe their compensation in a prospectus
supplement. The price to the public of our securities and the net
proceeds we expect to receive from the sale of such securities will
also be set forth in a prospectus supplement. For additional
information on the methods of sale, you should refer to the section
entitled “Plan of
Distribution” in this
prospectus.
As of March 10, 2021, the aggregate market value of our outstanding
common stock held by non-affiliates was approximately $308,181,800,
which was calculated in accordance with General Instruction I.B.1
of Form S-3, based on 143,340,410 shares of outstanding common
stock held by non-affiliates, at a price per share of $2.15, the
closing sale price of our common stock reported on the Nasdaq
Capital Market on March 10, 2021.
Our business and investing in our
securities involve significant risks. You should review carefully
the risks and uncertainties referenced under the heading
“Risk
Factors” on page 7
of this prospectus, as well as those
contained in the applicable prospectus supplement and any related
free writing prospectus, and in the other documents that are
incorporated by reference into this prospectus or the applicable
prospectus supplement.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this
prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus is March 26, 2021
VISTAGEN THERAPEUTICS, INC.
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement filed with the
Securities and Exchange Commission (the SEC), using a “shelf” registration
process. Under this shelf registration process, we may sell
the securities described in this prospectus in one or more
offerings. This prospectus provides you with a general
description of the securities which may be offered from
time-to-time. Each time we offer securities for sale, we will
provide a prospectus supplement that contains information about the
specific terms of that offering. Any prospectus supplement may also
add or update information contained in this prospectus. You
should read both this prospectus and any prospectus supplement
together with additional information described below under
“Where You Can Find More
Information” and
“Incorporation of Certain
Information by Reference.”
THIS PROSPECTUS MAY
NOT BE USED TO CONSUMMATE A SALE OF SECURITIES UNLESS IT IS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
You should rely only on the information contained or incorporated
by reference in this prospectus, and in any prospectus
supplement. We have not authorized any other person to provide
you with different information. If anyone provides you with
different or inconsistent information, you should not rely on
it. We are not making offers to sell or solicitations to buy
the securities described in this prospectus in any jurisdiction in
which an offer or solicitation is not authorized, or in which the
person making that offer or solicitation is not qualified to do so
or to anyone to whom it is unlawful to make an offer or
solicitation. You should not assume that the information in
this prospectus or any prospectus supplement, as well as the
information we file or previously filed with the SEC that we
incorporate by reference in this prospectus or any prospectus
supplement, is accurate as of any date other than its respective
date. Our business, financial condition, results of operations
and prospects may have changed since those dates.
This prospectus contains summaries of certain provisions contained
in some of the documents described herein, but reference is made to
the actual documents for complete information. All of the summaries
are qualified in their entirety by the actual documents. Copies of
some of the documents 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 you
may obtain copies of those documents as described below under the
heading “Where You Can Find More
Information.”
COMPANY OVERVIEW
This summary highlights information contained elsewhere in this
prospectus. This summary does not contain all the information you
should consider before buying our securities. You should read the
following summary together with the more detailed information
appearing in this prospectus and any accompanying prospectus
supplement, including the section titled “Risk Factors”
on page 7, before deciding whether to purchase our
securities.
In this prospectus, unless otherwise stated or the context
otherwise requires, references to “VistaGen,”
“Company,” “we,” “us,”
“our,” refer to VistaGen Therapeutics,
Inc.
Overview
We are a clinical-stage biopharmaceutical
company committed to developing and commercializing
differentiated new generation medications that go beyond the
current standard of care for anxiety, depression and other central
nervous system (CNS) disorders. Our pipeline includes three CNS
product candidates, each with a differentiated potential mechanism
of action, favorable safety results observed in all clinical
studies to date, and therapeutic potential in multiple CNS markets.
We are currently preparing PH94B for a pivotal Phase 3 clinical
study as a potential acute treatment of anxiety in adults with
social anxiety disorder (SAD), as well as additional nonclinical and
clinical studies required to support our U.S. New Drug Application
(NDA) for that indication should our Phase 3 clinical
program be successful. In addition, we are planning
for several small exploratory Phase 2A studies of PH94B in
adult patients, including in adjustment disorder, pre-procedural
anxiety, postpartum anxiety and post-traumatic stress disorder.
PH10 has completed a successful exploratory Phase 2A study for the
treatment of major depressive disorder (MDD). We are currently preparing for planned Phase 2B
clinical development of PH10 as a potential stand-alone treatment
for MDD. In several clinical studies, AV-101 was shown to be orally
bioavailable and was well-tolerated. Based on successful
preclinical studies involving AV-101 alone and in combination with
probenecid, we are currently planning to pursue Phase 1B, and, if
successful, subsequent Phase 2A clinical development of AV-101, in
combination with probenecid, for treatment of CNS indications
involving the N-methyl-D-aspartate receptor (NMDAR). Additionally, our wholly owned subsidiary,
VistaGen Therapeutics, Inc., d/b/a VistaStem, a California
corporation (VistaStem), has pluripotent stem cell technology focused on
assessing and developing small molecule new chemical entities
(NCEs) for our CNS pipeline, or for out-licensing, by
utilizing CardioSafe
3D, VistaStem’s
customized human heart cell-based cardiac bioassay system. Our goal
is to become a biopharmaceutical company that develops and
commercializes innovative CNS therapies for multiple large and
growing neuropsychiatry and neurology markets worldwide where we
believe current treatments are inadequate to meet the needs of
millions of patients.
Our Product Candidates
PH94B Nasal Spray for Anxiety Disorders
PH94B is an odorless synthetic rapid-onset pherine nasal spray with
therapeutic potential in a wide range of neuropsychiatric
indications involving anxiety or phobia. Conveniently
self-administered in microgram-level doses without requiring
systemic uptake and distribution to achieve its anti-anxiety
effects, we are initially developing PH94B as a potential as a
fast-acting, non-sedating, non-addictive new generation acute
treatment of anxiety in adults with SAD. SAD affects approximately
20 million Americans and, according to the National Institutes of
Health (NIH), is the third most common psychiatric condition
after depression and substance abuse. A person with SAD feels
symptoms of anxiety or fear in certain social situations, such as
meeting new people, dating, being on a job interview, answering a
question in a classroom or conference room, or having to talk to a
cashier in a store. Doing everyday things in front of other people
- such as eating, drinking or using a public restroom – may
also cause anxiety or fear. A person with SAD may also feel
symptoms of fear and anxiety in performance situations, such as
giving a lecture, a speech or a presentation to classmates at
school, or colleagues at work, as well as playing in a sports game,
or dancing or playing a musical instrument on stage. A person
with SAD is afraid that he or she will be humiliated, judged, or
rejected. The fear and anxiety that people with SAD have in
social and performance situations is so strong that they feel they
are beyond their ability to control. As a result, SAD gets in the
way of going to work, attending school, meeting with others
socially or doing everyday things in situations with potential for
interpersonal interaction. People with SAD may worry about these
and other things for weeks before they happen. Sometimes, they end
up avoiding places or events where they think they might have to do
something that will embarrass or humiliate them or cause them to be
judged. Without treatment, SAD can last for many years or a
lifetime and prevent a person from reaching his or her full
potential.
Three oral antidepressants are approved by the U.S Food and Drug
Administration (FDA) specifically for treatment of SAD. These
FDA-approved antidepressants have slow onset of therapeutic effect
(often taking many weeks to months), require chronic administration
and often cause significant side effects that begin soon after
administration. We believe their slow onset of effect, required
chronic administration and significant potential side effects and
safety concerns may make these FDA-approved oral antidepressants
inadequate or inappropriate treatment alternatives for many
individuals affected by SAD. Our PH94B is fundamentally different
from the oral antidepressants approved by the FDA for treatment of
SAD, as well as all current anti-anxiety drugs, such as
benzodiazepines prescribed off-label for treatment of
SAD.
We believe PH94B-induced anxiolytic effects appear consistent with
the modulation of neural circuits involved in the pathogenesis of
SAD. Neurons in the limbic amygdala regulate fear and anxiety by
modulating inhibitory neurotransmission in other brain regions. A
microgram level intranasal dose of PH94B (3.2 micrograms) engages
specific nasal chemosensory neurons which activate olfactory bulb
neurons (OBNs) on the base of the brain. OBNs send neural
connections to neurons in the central limbic amygdala, the brain
center where fear and anxiety are regulated, resulting in
downstream signaling and rapid-onset anti-anxiety effects.
Importantly, PH94B does not require systemic uptake and
distribution to produce its rapid-onset anti-anxiety effects. In
all clinical studies to date, PH94B has not shown psychological
side effects (such as dissociation, euphoria or hallucinations),
sedation or other side effects and safety concerns that may be
caused by the current oral antidepressants approved by the FDA for
treatment of SAD, or by benzodiazepines and beta blockers, which,
although not FDA-approved to treat SAD, are often prescribed by
psychiatrists and physicians for treatment of SAD on an off-label
basis. While oral antidepressants, benzodiazepines and beta
blockers require systemic administration to achieve anxiolytic
effects, due to its unique pharmacology, PH94B does not require
systemic uptake and distribution to achieve its rapid-onset
anti-anxiety effects.
In a peer-reviewed, published double-blind, placebo-controlled
Phase 2 clinical trial, PH94B was statistically significantly more
effective than placebo in reducing both public-speaking anxiety
(p=0.002) and social interaction anxiety (p=0.009) in
laboratory-simulated challenges of SAD patients, within 15 minutes
of their self-administration of a non-systemic 1.6 microgram dose
of PH94B. Based on the results of
this Phase
2 study and our recent
consensus with the FDA that our initial pivotal
Phase 3 study of PH94B may be conducted in a manner substantially
similar to the public speaking anxiety component of such Phase 2
study, we are preparing
for Phase 3 clinical development of PH94B as an acute treatment of
anxiety in adults with SAD. Our goal is to develop and
commercialize PH94B as the first FDA-approved, rapid-onset,
non-sedating, non-systemic, non-additive acute treatment of anxiety
in adults with SAD. We believe PH94B has potential for use on
demand to treat symptoms of anxiety which result from often
predictable anxiety-provoking stressors, much like a rescue inhaler
is used on demand, before an asthma attack or a migraine drug is
used before onset of a migraine episode. We also believe PH94B has
potential to treat other anxiety-related neuropsychiatric
indications, such as adjustment disorder, postpartum anxiety,
preprocedural anxiety (e.g., pre-MRI), panic disorder,
post-traumatic stress disorder and specific social phobias. In
addition to preparing for Phase 3 development of PH94B as a
potential acute treatment of anxiety for adults with SAD, we are
planning for a series of small exploratory Phase 2A clinical
studies of PH94B for treatment of adjustment disorder, postpartum
anxiety, post-traumatic stress disorder, and pre-procedural
anxiety. The FDA has granted
Fast Track designation for development of PH94B for acute treatment
of anxiety in adults with SAD, which we believe is the FDA’s
first such designation for a drug candidate for
SAD.
PH10 Nasal Spray for Depression Disorders and Suicidal
Ideation
PH10 is an odorless synthetic pherine nasal spray with potential to
be a fast-acting treatment for multiple neuropsychiatric
indications involving depression and suicidal ideation.
Conveniently self-administered in microgram-level doses without
systemic exposure, we are develop PH10 as a potential rapid-onset,
stand-alone treatment of MDD.
Depression is a serious medical illness and a global public health
concern that can occur at any time over a person's life. While most
people will experience depressed mood at some point during their
lifetime, MDD is different. MDD is the chronic, pervasive feeling
of utter unhappiness and suffering, which impairs daily
functioning. Symptoms of MDD include diminished pleasure or loss of
interest in activities, changes in appetite that result in weight
changes, insomnia or oversleeping, psychomotor agitation, loss of
energy or increased fatigue, feelings of worthlessness or
inappropriate guilt, difficulty thinking, concentrating or making
decisions, and thoughts of death or suicide and attempts at
suicide.
The most commonly-prescribed current oral antidepressants are known
as selective serotonin reuptake inhibitors (SSRIs), and serotonin-norepinephrine reuptake
inhibitors (SNRIs). SSRIs are intended to increase the amount of
available serotonin, a neurotransmitter closely linked to mood and
anxiety disorders, by inhibiting the reuptake of serotonin in the
brain, preventing nerve cells from reabsorbing serotonin and
reducing the levels in the brain. This means more serotonin remains
available, which can sometimes improve symptoms and make patients
more responsive to psychotherapy and other treatments. SNRIs
similarly are intended to inhibit the reuptake of serotonin and
another neurotransmitter, norepinephrine, and increase the
available amounts of each in the brain. Like serotonin,
norepinephrine is a neurotransmitter linked to
mood.
While these medications can certainly be effective in the right
context, it can be a challenge to find the right drug or
combination of drugs for a particular patient. About
two-thirds of patients with MDD do not respond to their initial
treatment with such medications. In addition, it can take many
weeks or even months to identify whether an antidepressant is
working, all the while leaving a patient to cope with their
depression symptoms and the potentially debilitating side effects
of the antidepressants they are prescribed.
Due to their long-onset pharmacology, limited efficacy and many
side effects and safety concerns, current FDA-approved oral
antidepressants available in the multi-billion-dollar global
depression market are often inadequate to satisfy the underserved
medical needs of millions suffering from the debilitating effects
of depression. Inadequate response to current medications is among
the key reasons MDD is one of the leading public health concerns in
the United States, creating a significant unmet medical need for
new agents with fundamentally different mechanisms of action and
side effect and safety profiles.
PH10 is a new generation antidepressant with a mechanism of action
that is fundamentally different from all current FDA-approved
antidepressants. After self-administration, a non-systemic
microgram-level dose of PH10 binds to nasal chemosensory receptors
that, in turn, activate key neural circuits in the brain that can
lead to rapid-onset antidepressant effects, but without the
psychological side effects (such as dissociation and
hallucinations) or safety concerns that maybe be caused by
rapid-onset ketamine-based therapy, including both intravenous
ketamine and esketamine nasal spray, or the side effects and safety
concerns of current long-onset oral antidepressants. In a small
exploratory Phase 2A clinical trial (n=30), PH10, self-administered
at a dose of 6.4 micrograms, was well-tolerated and demonstrated
statistically significant (p=0.022) rapid-onset antidepressant
effects, which were sustained over an 8-week period, as measured by
the Hamilton Depression Rating Scale (HAM-D), without side effects or safety concerns that
may be caused by ketamine-based therapy and oral antidepressants.
Based on positive results from this exploratory Phase 2A study, we
are preparing for Phase 2B clinical development of PH10 in MDD,
which preparation includes completing two additional preclinical
toxicology studies required by the FDA to support our new
Investigational New Drug (IND) application for proposed Phase 2B clinical
development of PH10 in the U.S. With its favorable safety profile
observed during clinical development to date, we believe PH10 has
potential for multiple applications in global depression markets,
including first as a differentiated stand-alone therapy for
MDD.
AV-101, an Oral NMDA Receptor Antagonist for Depression and
Neurological Disorders
AV-101 (4-Cl-KYN) targets the NMDAR (N-methyl-D-aspartate
receptor), an ionotropic glutamate receptor in the brain. Abnormal
NMDAR function is associated with numerous CNS diseases and
disorders. AV-101 is an oral prodrug of 7-chloro-kynurenic acid
(7-Cl-KYNA), which is a potent and selective full antagonist of the
glycine co-agonist site of the NMDAR that inhibits the function of
the NMDAR. Unlike ketamine and many other NMDAR antagonists,
7-Cl-KYNA is not an ion channel blocker. At doses administered in
all studies to date, AV-101 has exhibited no dissociative or
hallucinogenic psychological side effects or safety concerns. With
its exceptionally few side effects and favorable safety profile
observed in all studies to date, AV-101, in combination with the
FDA-approved drug, probenecid, has potential to be a new,
differentiated oral treatment for multiple large-market CNS
indications where we believe current treatments are inadequate to
meet high underserved patient needs. The FDA has granted Fast Track
designation for development of AV-101 as both a potential
adjunctive treatment for MDD and as a non-opioid treatment for
neuropathic pain.
In late-2019, we completed a Phase 2 clinical trial of AV-101 as a
potential adjunctive treatment, together with a standard
FDA-approved oral SSRI or SNRI, in MDD patients who had an
inadequate response to a stable dose of their oral antidepressant
(the Elevate
Study). Topline results of
the Elevate Study (n=199) indicated that the AV-101 treatment arm
did not differentiate from placebo on the primary endpoint (change
in the Montgomery-Åsberg Depression Rating Scale
(MADRS-10) total score compared to baseline), potentially
due to sub-therapeutic levels of 7-Cl-KYNA in the brain. As in
prior clinical studies, AV-101 was well tolerated, with no
psychotomimetic side effects or drug-related serious adverse
events.
Our recent discoveries from successful preclinical studies of
AV-101 in combination with probenecid, a safe and well-known oral
anion transport inhibitor approved by the FDA for treatment of
gout, suggest that there is a substantially increased brain
concentration of AV-101 and its active metabolite, 7-Cl-KYNA, when
AV-101 is given together with probenecid. These surprising effects
were first revealed as to AV-101 and 7-Cl-KYNA in our recent
preclinical studies, although the effects are consistent with
well-documented clinical studies of probenecid’s ability to
increase the therapeutic benefits of several classes of
FDA-approved drugs that are unrelated to AV-101 and 7-Cl-KYNA,
including certain antibacterial, anticancer and antiviral
drugs. When probenecid was administered in combination with AV-101
in animal models, substantially increased brain concentrations of
AV-101 and 7-Cl-KYNA were discovered. We
also recently identified that some of the same kidney transporters
that reduce drug concentrations in the blood, by excretion in the
urine, are also found in the blood brain barrier and function to
reduce 7-Cl-KYNA levels in the brain by pumping it out of the brain
and back into the blood. In our recent preclinical studies with
AV-101 and probenecid, we discovered that blocking those
transporters in the blood brain barrier with probenecid resulted,
as noted above, in a substantially increased brain concentration of
7-Cl-KYNA. This 7-Cl-KYNA efflux-blocking effect of probenecid,
with the resulting increased brain levels and duration of
7-Cl-KYNA, suggests the potential impact of AV-101 with probenecid
could result in far more profound therapeutic benefits for patients
with MDD and other NMDAR-focused CNS disorders than demonstrated in
the Elevate Study.
In addition, a Phase 1B target engagement study completed after the
Elevate Study by the Baylor College of Medicine
(Baylor)
with financial support from the U.S. Department of Veterans Affairs
(VA), involved 10 healthy volunteer U.S. military
Veterans who received single doses of AV-101 (720 mg or 1440 mg) or
placebo, in a double-blind, randomized, cross-over controlled
trial. The primary goal of the study was to identify and define a
dose-response relationship between AV-101 and multiple
electrophysiological (EEG) biomarkers related to NMDAR function, as well as
blood biomarkers associated with suicidality
(the Baylor
Study). We believe the findings
from the Baylor Study suggest that, in healthy Veterans, the higher
dose of AV-101 (1440 mg) was associated with dose-related increase
in the 40 Hz Auditory Steady State Response (ASSR), a robust measure of the integrity of inhibitory
interneuron synchronization that is associated with NMDAR
inhibition. Findings from the Baylor Study were presented at the
58th Annual Meeting of the American College of
Neuropsychopharmacology (ACNP) in Orlando, Florida in December
2019.
The Baylor Study and the results of our recent preclinical studies
involving AV-101 in combination with probenecid suggest that it may
be possible to increase therapeutic concentrations and duration of
7-Cl-KYNA in the brain, and thus increase NMDAR antagonism in MDD
patients and individuals suffering from other CNS indications
involving abnormal function of the NMDAR, when AV-101 and
probenecid are combined. We are currently preparing for Phase 1B
clinical development of AV-101 in combination with
probenecid.
VistaStem Therapeutics – Stem Cell Technology for Drug
Rescue, Cell Therapy and Regenerative Medicine
In addition to our current CNS drug candidates, our wholly-owned
subsidiary, VistaStem Therapeutics (VistaStem) has developed stem cell technology-based,
pipeline-enabling capabilities involving application of human
pluripotent stem cell (hPSC) technologies. VistaStem’s customized
cardiac bioassay system, CardioSafe 3D, has been developed to discover and
develop small molecule New Chemical Entities (NCEs) for our CNS pipeline or out-licensing. In
addition, VistaStem’s stem cell technologies involving
hPSC-derived blood, cartilage, heart and liver cells have multiple
potential applications in the cell therapy (CT) and regenerative medicine (RM) fields.
To advance potential CT and RM applications of VistaStem’s
hPSC technologies related to heart cells, we licensed to BlueRock
Therapeutics LP, a next generation CT/RM company formed jointly by
Bayer AG and Versant Ventures and acquired by Bayer AG in 2019,
rights to develop and commercialize certain proprietary
technologies relating to the production of cardiac stem cells for
the treatment of heart disease. As a result of its acquisition of
BlueRock Therapeutics in 2019, Bayer AG now holds such rights
(the Bayer
Agreement). VistaStem
retains all rights to such technologies to discover and develop
small molecule NCEs and certain other applications not licensed
pursuant to the Bayer Agreement. In a manner similar to the Bayer
Agreement, we may pursue additional VistaStem collaborations
involving rights to develop and commercialize its hPSC technologies
for production of blood, cartilage, and/or liver cells for CT and
RM applications, including, among other indications, treatment of
arthritis, cancer and liver disease.
Corporate Information
VistaGen Therapeutics, Inc., a Nevada corporation, is the parent of
VistaGen Therapeutics, Inc. (d/b/a VistaStem Therapeutics, Inc.), a
wholly owned California corporation founded in 1998. Our principal
executive offices are located at 343 Allerton Avenue, South San
Francisco, California 94080, and our telephone number is (650)
577-3600. Our website address is www.vistagen.com.
The information contained on our website is not part of this
prospectus supplement or the accompanying prospectus. We have
included our website address as a factual reference and do not
intend it to be an active link to our website.
Securities Offerings under Prior Registration
Statements
Series A1 Warrants
On August 31, 2017, we entered into an underwriting agreement with
Oppenheimer & Co. Inc., relating to the issuance and sale
(the September 2017
Public Offering) of 1,371,430 shares of our common stock and
warrants to purchase an aggregate total of 1,892,572 shares of our
common stock, consisting of Series A1 Warrants to purchase up to
1,388,931 shares of common stock and Series A2 Warrants to purchase
up to 503,641 shares of common stock (the Series A1 Warrants and
Series A2 Warrants are collectively referred herein as the
Warrants). Each share of common stock was sold together
with 1.0128 Series A1 Warrants, each whole Series A1 Warrant
to purchase one share of common stock, and 0.3672 of a Series A2
Warrant, each whole Series A2 Warrant to purchase one share of
common stock, at a public offering price of $1.75 per share and
related Warrants.
Each Series A1 Warrant became exercisable six months following the
date of issuance, while the Series A2 Warrants were immediately
exercisable. The Warrants have an exercise price of $1.82 per whole
share, and expire five years from the date first exercisable. In
December 2017 and January 2018, all of the Series A2 Warrants were
exercised at the reset exercise price resulting from a subsequent
public offering of shares of our common stock and warrants
completed in December 2017, from which we received nominal cash
proceeds. As of the date of this prospectus, all Series A1 Warrants
offered and sold in the September 2017 Public Offering remain
outstanding.
Series D Convertible Preferred Stock
On
December 17, 2020, in connection with the December 2020 Public
Offering, as defined below, our Board of Directors (our
Board) authorized the
creation of a series of up to 2.0 million shares of Series D
Convertible Preferred Stock, par value $0.001 (Series D Preferred), which became
effective with the filing of a Certificate of Designation of the
Relative Rights and Preferences of the Series D Convertible
Preferred Stock with the Secretary of State of the State of Nevada
on December 21, 2020.
On December 18, 2020, we entered into an underwriting
agreement (the December 2020
Underwriting Agreement) pursuant to which we sold, in an
underwritten public offering (the December 2020 Public Offering), 63.0
million shares of our common stock at a public offering price of
$0.92 per share and 2.0 million shares of Series D Preferred at a
public offering price of $21.16 per share, resulting in gross
proceeds to us of $100 million. Net proceeds to us from the
securities sold in the December 2020 Public Offering, after
deducting underwriting discounts and commissions and offering
expenses payable by us, were approximately $93.6
million.
Each
whole share of Series D Preferred is initially convertible into 23
shares of our common stock, or an aggregate of 46.0 million shares
of our common stock (the Series D
Conversion Shares), at any time at the option of the
holder; provided, that
the Series D Preferred was not convertible until the effective date
of the Charter Amendment (defined below); and provided further, that the holders of
Series D Preferred will be prohibited, subject to certain
exceptions, from converting such shares of Series D Preferred into
shares of our common stock if, as a result of such conversion, the
holder, together with its affiliates and other attribution parties,
would own more than 9.99% of the total number of shares of our
common stock then issued and outstanding, which percentage may be
changed at the holder’s election to a lower percentage at any
time or to a higher percentage not to exceed 19.99% upon 61
days’ prior notice to us.
Charter Amendment
On
March 5, 2021, at a virtual special meeting of stockholders of the
Company, stockholders approved an amendment to our Restated
Articles of Incorporation, as amended (our Charter), to increase the number of
shares of common stock authorized for potential future issuance
from 175 million to 325 million shares (the Charter Amendment). We filed a
certificate of amendment with the Secretary of State of the State
of Nevada to effect the Charter Amendment on March 5, 2021.
RISK FACTORS
Investing in our securities involves a high degree of risk. Before
deciding whether to purchase any of our securities, you should
carefully consider the risks and uncertainties described under
“Risk
Factors”
in our Annual Report on Form 10-K
for the fiscal year ended March 31, 2020, our Quarterly Reports on
Form 10-Q for the periods ended June 30, 2020, September 30, 2020
and December 31, 2020, and our other filings with the SEC, all of
which are incorporated by reference herein. If any of these risks
actually occur, our business, financial condition and results of
operations could be materially and adversely affected and we may
not be able to achieve our goals, the value of our securities could
decline and you could lose some or all of your investment.
Additional risks not presently known to us or that we currently
deem immaterial may also impair our business operations. If any of
these risks occur, the trading price of our common stock could
decline materially and you could lose all or part of your
investment.
CAUTIONARY NOTES REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus, any prospectus supplement and the documents
incorporated by reference herein contain forward-looking statements
that involve substantial risks and uncertainties. All statements,
other than statements of historical facts, contained in this
prospectus, any prospectus supplement and the documents
incorporated by reference herein, including statements
regarding our strategy,
future operations, future financial position, future revenue,
projected costs, prospects, plans, objectives of management and
expected market growth, are forward-looking statements. These
statements involve known and unknown risks, uncertainties and other
important factors that may cause our actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements.
The words “anticipate,” “believe,”
“estimate,” “expect,” “intend,”
“may,” “plan,” “predict,”
“project,” “target,”
“potential,” “will,” “would,”
“could,” “should,” “continue,”
and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. These forward-looking statements include,
among other things, statements about:
●
the
impact of the COVID-19 pandemic, efforts to contain the pandemic
and resulting economic downturn on our operations and financial
condition;
●
the
availability of capital to satisfy our working capital
requirements;
●
the
accuracy of our estimates regarding expenses, future revenues and
capital requirements;
●
our
plans to develop and commercialize our any of our current product
candidates;
●
our
ability to initiate and complete our clinical trials and to advance
our product candidates into additional clinical trials, including
pivotal clinical trials, and successfully complete such clinical
trials;
●
regulatory developments in the
United States and foreign countries;
●
the
performance of our third-party contractors involved with the
manufacture and production of our drug candidates for nonclinical
and clinical development activities, contract research
organizations and other third-party nonclinical and clinical
development collaborators and regulatory service
providers;
●
our ability to
obtain and maintain intellectual property protection for our core
assets;
●
the size of the
potential markets for our product candidates and our ability to
serve those markets;
●
the rate and degree
of market acceptance of our product candidates for any indication
once approved;
●
the success of
competing products and product candidates in development by others
that are or become available for the indications that we are
pursuing;
●
the loss of key scientific,
clinical and nonclinical development, and/or management personnel,
internally or from one of our third-party
collaborators;
●
our ability to
comply with Nasdaq continued listing standards;
●
our ability to continue as a going
concern; and
●
other risks and uncertainties,
including those described under Item 1A, “Risk Factors,” in our Annual
Report on Form 10-K for the fiscal year ended March 31, 2020, and
those described under Part II, Item 1A, “Risk Factors,” in our Quarterly
Reports on Form 10-Q for the quarters ended June 30, 2020,
September 30, 2020 and December 31, 2020, which risk factors are
incorporated herein by reference.
These forward-looking statements are only predictions and we may
not actually achieve the plans, intentions or expectations
disclosed in our forward-looking statements, so you should not
place undue reliance on our forward-looking statements. Actual
results or events could differ materially from the plans,
intentions and expectations disclosed in the forward-looking
statements we make. We have based these forward-looking statements
largely on our current expectations and projections about future
events and trends that we believe may affect our business,
financial condition and operating results. We have included
important factors in the cautionary statements included in this
prospectus, particularly in the “Risk
Factors” sections in
this prospectus, any accompanying prospectus supplement and the
documents incorporated by reference herein, that we believe could
cause actual future results or events to differ materially from the
forward-looking statements that we make. Our forward-looking statements do not
reflect the potential impact of any future acquisitions, mergers,
dispositions, joint ventures or investments we may
make.
You should read this prospectus, any prospectus supplement and the
documents incorporated by reference herein and the documents that
we have filed as exhibits to the registration statement of which
this prospectus is a part completely and with the understanding
that our actual future results may be materially different from
what we expect. We qualify all of the forward-looking statements in
this prospectus and the documents incorporated by reference herein
by these cautionary statements. Except as required by law, we
undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
USE OF PROCEEDS
Unless otherwise provided in the applicable prospectus supplement,
we intend to use the net proceeds from the sale of
the securities under this prospectus primarily for
research and development expenses associated with continuing
development of PH94B, PH10, AV-101,
VistaStem’s drug rescue activities focused on potential drug
candidates to expand our CNS pipeline or out-licensing
opportunities, proof of principle studies with respect to
potential CT and RM applications of VistaStem’s stem cell
technology involving blood, cartilage and liver cells, and for
other working capital and capital expenditures. We may also use the
net proceeds from the sale of the securities under this
prospectus to in-license, acquire or invest in complementary
businesses, technologies, products or assets. However, we have
no current commitments or obligations to do so.
Pending other uses, we intend to invest our proceeds from the
offering in short-term investments or hold them as cash. We cannot
predict whether the proceeds invested will yield a favorable
return. Our management will have broad discretion in the use of the
net proceeds from this offering, and investors will be relying on
the judgment of our management regarding the application of the net
proceeds.
DESCRIPTION
OF OUR CAPITAL
STOCK
General
Our
authorized capital stock consists of 325.0 million shares of common
stock, $0.001 par value per share, and 10.0 million shares of preferred
stock, $0.001 par value per share. The following is a description
of our common stock and certain provisions of our Charter, and our
amended and restated bylaws, and certain provisions of Nevada
law.
As of
March 10, 2021, there were
issued and outstanding, or reserved for issuance:
●
143,762,996 shares of common stock held by approximately
25,000 stockholders of
record;
●
750,000 shares of common stock reserved for issuance upon
conversion of 500,000 shares
our Series A Preferred held by one institutional investor and one
accredited individual investor;
●
1,131,669 shares of common stock reserved for issuance upon
conversion of 1,131,669 shares
of our Series B Preferred held by one institutional
investor;
●
2,318,012 shares of common stock reserved for issuance upon
conversion of 2,318,012 shares
of our Series C Preferred held by one institutional
investor;
●
46,000,000 shares of common stock reserved for issuance upon
conversion of 2,000,000 shares
of our Series D Preferred held by 23 institutional
investors;
●
19,437,532 shares of common stock that have been reserved
for issuance upon exercise of outstanding warrants, with a weighted
average exercise price of $1.77
per share, including up to 1,371,430 shares of common stock
issuable upon exercise of the Series A1 Warrants;
●
7,643,088 shares of common stock reserved for issuance upon
exercise of outstanding stock options under our Amended and
Restated 2016 Stock Incentive Plan, with a weighted average
exercise price of $1.41 per share;
●
6,700,000 shares of common stock reserved for issuance upon
exercise of outstanding stock options under our 2019 Omnibus Equity
Incentive Plan, with a weighted average exercise price of $1.22 per
share, and
●
2,168,158 shares of common stock reserved for future
issuance in connection with future grants under our 2019 Omnibus
Equity Incentive Plan.
We may
elect or be required to amend our Charter to increase the number of
shares of common stock authorized for issuance prior to completing
sales of shares of our common stock, or securities convertible
and/or exchangeable into shares of our common stock described in
this prospectus and/or any accompanying prospectus
supplement.
Common Stock
This section describes the general terms of our common stock that
we may offer from time to time. For more detailed information, a
holder of our common stock should refer to our Charter and our
Bylaws, copies of which are filed with the SEC as exhibits to the
registration statement of which this prospectus is a
part.
Except
as otherwise expressly provided in our Charter, or as required by
applicable law, all shares of our common stock have the same rights
and privileges and rank equally, share ratably and are identical in
all respects as to all matters, including, without limitation,
those described below. All outstanding shares of common stock are
fully paid and nonassessable.
Voting Rights
Each
holder of our common stock is entitled to cast one vote for each
share of common stock held on all matters submitted to a vote of
stockholders. Cumulative voting for election of directors is not
allowed under our Charter, which means that a plurality of the
shares voted can elect all of the directors then outstanding for
election. Except as otherwise provided under Nevada law or our
Charter and Bylaws, on matters other than election of directors,
action on a matter is approved if the votes cast favoring the
action exceed the votes cast opposing the action.
Dividend Rights
The
holders of outstanding shares of our common stock are entitled to
receive dividends out of funds legally available, if our Board, in
its discretion, determines to issue a dividend, and only at the
times and in the amounts that our Board may determine. Our Board is
not obligated to declare a dividend. We have not paid any dividends
in the past and we do not intend to pay dividends in the
foreseeable future.
Liquidation Rights
Upon
our liquidation, dissolution or winding-up, the holders of our
common stock will be entitled to share equally, identically and
ratably in all assets remaining, subject to the prior satisfaction
of all outstanding debt and liabilities and the preferential rights
and payment of liquidation preferences, if any, on any outstanding
shares of preferred stock.
No Preemptive or Similar Rights
Our
common stock is not subject to conversion, redemption, sinking fund
or similar provisions.
Transfer Agent and Registrar
The
transfer agent and registrar for our common stock is Computershare
Trust Company, N.A.
Preferred Stock
This section describes the general terms and provisions of our
outstanding shares of preferred stock, as well as preferred stock
that we may offer from time to time. The applicable prospectus
supplement will describe the specific terms of the shares of
preferred stock offered through that prospectus supplement, which
may differ from the terms we describe below. We will file a
copy of the certificate of designation that contains the terms of
each new series of preferred stock with the SEC each time we issue
a new series of preferred stock, and these certificates of
designation will be incorporated by reference into the registration
statement of which this prospectus is a part. Each certificate of
designation will establish the number of shares included in a
designated series and fix the designation, powers, privileges,
preferences and rights of the shares of each series as well as any
applicable qualifications, limitations or restrictions. A holder of
our preferred stock should refer to the applicable certificate of
designation, our Charter, and the applicable prospectus supplement
(and any related free writing prospectus that we may authorize to
be provided to you) for more specific information.
We are
authorized, subject to limitations prescribed by Nevada law, to
issue up to 10.0 million shares of preferred stock in one or more
series, to establish from time to time the number of shares to be
included in each series and to fix the designation, powers,
preferences and rights of the shares of each series and any of its
qualifications, limitations or restrictions. Our Board may
authorize the issuance of preferred stock with voting or conversion
rights that could adversely affect the voting power or other rights
of the holders of the common stock. The issuance of preferred
stock, while providing flexibility in connection with possible
acquisitions and other corporate purposes, could, among other
things, have the effect of delaying, deferring or preventing a
change in control of the Company and may adversely affect the
market price of our common stock and the voting and other rights of
the holders of our common stock.
Outstanding Series of Preferred Stock
Currently,
there are four series of our preferred stock outstanding- Series A
Convertible Preferred Stock, Series B 10% Convertible Preferred
Stock, Series C Convertible Preferred Stock and Series D
Convertible Preferred Stock. The rights and preferences associated
with each series are summarized below.
Series A Preferred
General
In December 2011, our Board authorized the creation of a series of
up to 500,000 shares of Series A Preferred, par value $0.001
(Series A
Preferred). Each
restricted share of Series A Preferred is currently convertible at
the option of the holder into one and one-half restricted shares of
our common stock. The Series A Preferred ranks prior to
the common stock for purposes of liquidation
preference.
Conversion and Rank
At
March 10, 2021, there were
500,000 shares of Series A Preferred outstanding, which shares are
currently subject to beneficial ownership blockers and are
exchangeable at the option of the holders into an aggregate of
750,000 shares of our common stock. The Series A Preferred ranks
prior to our common stock for purposes of liquidation
preference.
Conversion Restriction
At no
time may a holder of shares of Series A Preferred convert shares of
the Series A Preferred if the number of shares of common stock to
be issued pursuant to such conversion would result in such holder
beneficially owning (as determined in accordance with Section 13(d)
of the Securities and Exchange Act of 1934, as amended (the
Exchange Act) and the rules
thereunder) more than 9.99% of all of the common stock outstanding
at such time; provided, however, that this limitation may be
waived upon sixty-one (61) days’ notice to us.
Dividend Rights
The
Series A Preferred has no separate dividend rights. However,
whenever our Board declares a dividend on our common stock, each
holder of record of a share of Series A Preferred, or any fraction
of a share of Series A Preferred, on the date set by the Board to
determine the owners of the common stock of record entitled to
receive such dividend (Record
Date) shall be entitled to receive out of any assets at the
time legally available therefor, an amount equal to such dividend
declared on one share of common stock multiplied by the number of
shares of common stock into which such share, or such fraction of a
share, of Series A Preferred could be exchanged on the Record
Date.
Voting Rights
The
Series A Preferred has no voting rights, except with respect to
transactions upon which the Series A Preferred shall be entitled to
vote separately as a class. The common stock into which the Series
A Preferred is exchangeable shall, upon issuance, have all of the
same voting rights as other issued and outstanding shares of our
common stock.
Liquidation Rights
In the
event of the liquidation, dissolution or winding up of our affairs,
after payment or provision for payment of our debts and other
liabilities, the holders of Series A Preferred then outstanding
shall be entitled to receive, out of our assets, if any, an amount
per share of Series A Preferred calculated by taking the total
amount available for distribution to holders of all of our
outstanding common stock before deduction of any preference
payments for the Series A Preferred, divided by the total of (x),
all of the then outstanding shares of our common stock, plus (y)
all of the shares of our common stock into which all of the
outstanding shares of the Series A Preferred can be exchanged
before any payment shall be made or any assets distributed to the
holders of the common stock or any other junior stock.
Series B Preferred
General
In July 2014, our Board authorized the creation of a class of
Series B Preferred Stock, par value $0.001 (Series B
Preferred). In May 2015, we
filed a Certificate of Designation of the Relative Rights and
Preferences of the Series B 10% Preferred Stock of VistaGen
Therapeutics, Inc. (Certificate of
Designation) with the Nevada
Secretary of State to designate 4.0 million shares of our
authorized preferred stock as Series B
Preferred.
Conversion
Each
share of Series B Preferred is convertible, at the option of the
holder (Voluntary
Conversion), into one (1) share of the Company’s
common stock. All outstanding shares of Series B Preferred are also
automatically convertible into common stock (Automatic Conversion) upon the closing
or effective date of any of the following transactions or events:
(i) a strategic transaction involving AV-101 with an initial up
front cash payment to the Company of at least $10.0 million; (ii) a
registered public offering of Common Stock with aggregate gross
proceeds to the Company of at least $10.0 million; or (iii) for 20
consecutive trading days the Company’s Common Stock trades at
least 20,000 shares per day with a daily closing price of at least
$12.00 per share; provided, however, that Automatic Conversion and
Voluntary Conversion are subject to certain beneficial ownership
blockers set forth in Section 6 of the Certificate of
Designation.
Following
the completion of our $10.9 million underwritten public offering of
our common stock in May 2016, which public offering occurred
concurrently with and facilitated our listing on the Nasdaq Capital
Market, approximately 2.4 million shares of Series B Preferred were
converted automatically into approximately 2.4 million shares of
our common stock pursuant to the Automatic Conversion provision. At
March 10, 2021, there were
1,131,669 shares of Series B Preferred outstanding, which shares
are currently subject to beneficial ownership blockers and are
exchangeable at the option of the respective holders by Voluntary
Conversion, or pursuant to Automatic Conversion to the extent not
otherwise subject to beneficial ownership blockers, into an
aggregate of 1,131,669 shares of our common stock.
Conversion Restriction
At no
time may a holder of shares of Series B Preferred convert shares of
the Series B Preferred, either by Voluntary Conversion or Automatic
Conversion, if the number of shares of common stock to be issued
pursuant to such conversion would result in such holder
beneficially owning (as determined in accordance with Section 13(d)
of the Exchange Act and the rules thereunder) more than 9.99% of
all of the common stock outstanding at such time; provided, however, that this limitation may be
waived upon sixty-one (61) days’ notice to us.
Rank
The
Series B Preferred ranks prior to our common stock,
and pari
passu with the Series A Preferred for purposes of
liquidation preference.
Dividend Rights
Prior to either a Voluntary Conversion or Automatic Conversion,
shares of Series B Preferred will accrue dividends, payable only in
unregistered common stock, at a rate of 10% per annum
(the Accrued
Dividend) on the
stated value of the Series B Preferred ($7.00 per share). The
Accrued Dividend will be payable on the date of either a Voluntary
Conversion or Automatic Conversion solely in that number of shares
of Common Stock equal to the Accrued Dividend.
Voting Rights
The
Series B Preferred has no voting rights, except with respect to
transactions upon which the Series B Preferred shall be entitled to
vote separately as a class. The common stock into which the Series
B Preferred shall be exchangeable shall, upon issuance, have all of
the same voting rights as other issued and outstanding shares of
our common stock.
Liquidation Rights
Upon
any liquidation, dissolution, or winding-up of the Company, whether
voluntary or involuntary, the holders of Series B Preferred are
entitled to receive out of the Company’s assets, whether
capital or surplus, an amount equal to the stated value of the
Series B Preferred ($7.00 per share), plus any accrued and unpaid
dividends thereon, before any distribution or payment shall be made
to the holders of any junior securities, including holders of our
common stock. If the assets of the Company are insufficient to pay,
in full, such amounts, then the entire assets to be distributed to
the holders of the Series B Preferred shall be ratably distributed
among the holders in accordance with the respective amounts that
would be payable on such shares if all amounts payable thereon were
paid in full.
Series C Preferred
General
In
January 2016, our Board authorized the creation of and,
accordingly, we filed a Certificate of
Designation of the Relative Rights and Preferences of the Series C
Convertible Preferred Stock of VistaGen Therapeutics, Inc.
(the Series
C Preferred Certificate of
Designation) with the Nevada
Secretary of State to designate 3.0 million shares of our preferred
stock, par value $0.001 per share, as Series C Convertible
Preferred Stock (Series C
Preferred).
Conversion and Rank
At
March 10, 2021, there were
2,318,012 shares of Series C Preferred outstanding, which shares of
Series C Preferred are currently subject to beneficial ownership
blockers and are exchangeable at the option of the holder into
2,318,012 shares of our common stock. The Series C Preferred ranks
prior to our common stock for purposes of liquidation preference,
and pari
passu with the Series A Preferred and Series B
Preferred.
Conversion Restriction
At no
time may a holder of shares of Series C Preferred convert shares of
the Series C Preferred if the number of shares of common stock to
be issued pursuant to such conversion would result in such holder
beneficially owning (as determined in accordance with Section 13(d)
of the Exchange Act and the rules thereunder) more than 9.99% of
all of the common stock outstanding at such time; provided, however, that this limitation may be
waived upon sixty-one (61) days’ notice to us.
Dividend Rights
The
Series C Preferred has no separate dividend rights. However,
whenever our Board declares a dividend on our common stock, each
holder of record of a share of Series C Preferred, or any fraction
of a share of Series C Preferred, on the Record Date set by the
Board to determine the owners of the common stock of record
entitled to receive such dividend shall be entitled to receive out
of any assets at the time legally available therefor, an amount
equal to such dividend declared on one share of common stock
multiplied by the number of shares of common stock into which such
share, or such fraction of a share, of Series C Preferred could be
exchanged on the Record Date.
Voting Rights
The
Series C Preferred has no voting rights, except with respect to
transactions upon which the Series C Preferred shall be entitled to
vote separately as a class. The common stock into which the Series
C Preferred is exchangeable shall, upon issuance, have all of the
same voting rights as other issued and outstanding shares of our
common stock.
Liquidation Rights
In the
event of the liquidation, dissolution or winding up of our affairs,
after payment or provision for payment of our debts and other
liabilities, the holders of Series C Preferred then outstanding
shall be entitled to receive, out of our assets, if any, an amount
per share of Series C Preferred calculated by taking the total
amount available for distribution to holders of all of our
outstanding common stock before deduction of any preference
payments for the Series C Preferred, divided by the total of (x),
all of the then outstanding shares of our common stock, plus (y)
all of the shares of our common stock into which all of the
outstanding shares of the Series C Preferred can be exchanged
before any payment shall be made or any assets distributed to the
holders of the common stock or any other junior stock.
Series D Preferred
In connection with the December 2020 Public Offering, on December
21, 2020, we filed the Certificate of Designation of the
Relative Rights and Preferences of the Series D Convertible
Preferred Stock (the
Series
D COD) with the Secretary of State of the State
of Nevada to establish the terms,
rights, obligations and preferences of the Series D Preferred
Stock. The Series D COD became effective upon the filing with
the Secretary of State of the State of Nevada. The Series D COD designates 2,000,000 shares as
Series D Convertible Preferred Stock, par value $0.001 per share
(Series D
Preferred).
Rank
The
shares of Series D Preferred rank: (i) senior to all of our common
stock until the date of the Charter Amendment; (ii) senior to any
class or series of our capital stock hereafter created specifically
ranking by its terms junior to the Series D Preferred; (iii) on
parity to all shares of our Series A Preferred, Series B Preferred
and Series C Preferred; (iv) on parity to any class or series of
the Company’s capital stock hereafter created specifically
ranking by its terms on parity with the Series D Preferred; and (v)
junior to any class or series of the Company’s capital stock
thereafter created specifically ranking by its terms senior to the
Series D Preferred, in each case, as to distributions of assets
upon the Company’s liquidation, dissolution or winding up
whether voluntarily or involuntarily and/or the right to receive
dividends.
Conversion
Each
whole share of Series D Preferred is initially convertible into 23
shares of common stock at any time at the option of the holder (the
Series D Conversion
Shares); provided,
that the Series D Preferred will not be convertible prior to the
date on which the Company receives stockholder approval and upon
effectiveness of the Charter Amendment; and provided further, that the holders of
Series D Preferred will be prohibited, subject to certain
exceptions, from converting such shares of Series D Preferred into
shares of common stock if, as a result of such conversion, the
holder, together with its affiliates, would own more than 9.99% of
the total number of shares of common stock then issued and
outstanding, which percentage may be changed at the holder’s
election to a lower percentage at any time or to a higher
percentage not to exceed 19.99% upon 61 days’ notice to
us.
As
noted above, our stockholders approved the Charter Amendment at a
virtual special meeting of stockholders on March 5, 2021, and the
Charter Amendment was filed with the State of Nevada and became
effective on the same date.
Liquidation Rights
Prior
to approval and effectiveness of the Charter Amendment, each holder
of shares of Series D Preferred was entitled to receive, in
preference to any distributions of any of our assets or surplus
funds to the holders of common stock and any of our securities that
by their terms are junior to the Series D Preferred and
pari passu with any
distribution to the holders of any securities having (by their
terms) parity with the Series D Preferred, an amount equal to
$0.001 per share of Series D Preferred, plus an additional amount
equal to any dividends declared but unpaid on such shares, before
any payments shall be made or any assets distributed to holders of
any class of common stock or any of our securities that by their
terms are junior to the Series D Preferred. If, upon any such
liquidation, dissolution or winding up of the Company, our assets
shall be insufficient to pay the holders of shares of the Series D
Preferred the amount required under the preceding sentence, then
all of our remaining assets shall be distributed ratably to holders
of the shares of the Series D Preferred and any securities having
(by their terms) parity with the Series D Preferred. After such
preferential payment, each holder of shares of Series D Preferred
shall be entitled to participate pari passu with the holders of common
stock (on an as-converted basis, without regard to the 9.99%
beneficial ownership limitation) and any securities having (by
their terms) parity with the Series D Preferred, including the
Series A Preferred, the Series B Preferred Stock and the Series C
Preferred, in the remaining distribution of our net assets
available for distribution.
Following
the approval and effectiveness of the Charter Amendment on March 5,
2021, the Series D Preferred now has no liquidation
preference.
Dividend Rights
Shares
of the Series D Preferred Stock are entitled to receive any
dividends payable to holders of common stock on an
as-converted-to-common-stock basis.
Voting Rights
Following
the approval and effectiveness of the Charter Amendment on March 5,
2021, the affirmative vote of holders of a majority of the
then-outstanding shares of Series D Preferred will be required
before we can: (a) amend, alter, modify or repeal (whether by
merger, consolidation or otherwise) the Series D COD, our Charter
and our Bylaws in any manner that adversely affects the rights,
preferences, privileges or the restrictions provided for the
benefit of, the Series D Preferred; (b) issue further shares of
Series D Preferred or increase or decrease (other than by
conversion) the number of authorized shares of Series D Preferred;
or (c) enter into any agreement to do any of the foregoing that is
not expressly made conditional on obtaining the affirmative vote or
written consent of the requisite holders.
Redemption
We are
not obligated to redeem or repurchase any shares of Series D
Preferred. Shares of Series D Preferred will not otherwise be
entitled to any redemption rights or mandatory sinking fund or
analogous fund provisions.
Registration of Series D Conversion Shares
The Series D Conversion Shares were previously registered pursuant
to a prospectus supplement filed with the SEC on December
18, 2020
pursuant to Rule 424(b)(5) under the Securities Act of 1933, as
amended (the Securities
Act), which supplemented the Company’s
effective shelf registration
statement on Form S-3 (File No.
333-234025), originally filed with the SEC on September 30,
2019 and declared effective on October 8, 2019. Pursuant to Rule
415(a)(6) and Rule 429 under the Securities Act, the offering of
the Series D Conversion Shares will be registered pursuant to this
registration statement.
Shares of Preferred Stock Issuable Pursuant to this
Prospectus
We will
incorporate by reference as an exhibit to the registration
statement, which includes this prospectus, the form of any
certificate of designation that describes the terms of the series
of preferred stock we are offering. This description and the
applicable prospectus supplement will include:
●
the
title and stated value;
●
the
number of shares authorized;
●
the
liquidation preference per share;
●
the
purchase price;
●
the
dividend rate, period and payment date, and method of calculation
for dividends;
●
whether
dividends will be cumulative or non-cumulative and, if cumulative,
the date from which dividends will accumulate;
●
the
procedures for any auction and remarketing, if any;
●
the
provisions for a sinking fund, if any;
●
the
provisions for redemption or repurchase, if applicable, and any
restrictions on our ability to exercise such redemption and
repurchase rights;
●
any
listing of the preferred stock on any securities exchange or
market;
●
whether
the preferred stock will be convertible into our common stock, and,
if applicable, the conversion price, or how it will be calculated,
and the conversion period;
●
voting
rights, if any, of the preferred stock;
●
preemptive
rights, if any;
●
restrictions
on transfer, sale or other assignment, if any;
●
a
discussion of any material United States federal income tax
considerations applicable to the preferred stock;
●
the
relative ranking and preferences of the preferred stock as to
dividend rights and rights if we liquidate, dissolve or wind up our
affairs;
●
any
limitations on issuance of any class or series of preferred stock
ranking senior to or on a parity with the series of preferred stock
as to dividend rights and rights if we liquidate, dissolve or wind
up our affairs; and
●
any
other specific terms, preferences, rights or limitations of, or
restrictions on, the preferred stock.
When we
issue shares of preferred stock under this prospectus, the shares
will fully be paid and nonassessable and will not have, or be
subject to, any preemptive or similar rights.
DESCRIPTION OF
OUR WARRANTS
The following description, together with the additional information
we include in any applicable prospectus supplement or free writing
prospectus, summarizes the material terms and provisions of the
warrants that we may offer under this prospectus. Warrants may be
offered independently or together with common stock or preferred
stock offered by any prospectus supplement or free writing
prospectus, and may be attached to or separate from those
securities. While the terms we have summarized below will generally
apply to any future warrants we may offer under this prospectus, we
will describe the particular terms of any warrants that we may
offer in more detail in the applicable prospectus supplement or
free writing prospectus. The terms of any warrants we offer under a
prospectus supplement or free writing prospectus may differ from
the terms we describe below.
In the event that we issue warrants, we may issue the warrants
under a warrant agreement, which, if applicable, we will enter into
with a warrant agent to be selected by us. Forms of these warrant
agreements and forms of the warrant certificates representing the
warrants, and the complete warrant agreements and forms of warrant
certificates containing the terms of the warrants 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. We use the term “warrant
agreement” to refer to any of these warrant agreements. We
use the term “warrant agent” to refer to the warrant
agent under any of these warrant agreements. The warrant agent will
act solely as an agent of ours in connection with the warrants and
will not act as an agent for the holders or beneficial owners of
the warrants.
The following summaries of material provisions of the warrants and
the warrant agreements are subject to, and qualified in their
entirety by reference to, all the provisions of the warrant
agreement applicable to a particular series of warrants. We urge
you to read the applicable prospectus supplement or free writing
prospectus related to the warrants that we sell under this
prospectus, as well as the complete warrant agreements that contain
the terms of the warrants.
General
We will describe in the applicable prospectus supplement or free
writing prospectus the terms relating to a series of warrants. If
warrants for the purchase of common stock or preferred stock are
offered, the prospectus supplement or free writing prospectus will
describe the following terms, to the extent
applicable:
●
the offering price and the aggregate number of warrants
offered;
●
the total number of shares that can be purchased if a holder of the
warrants exercises them and, in the case of warrants for preferred
stock, the designation, total number and terms of the series of
preferred stock that can be purchased upon exercise;
●
the designation and terms of any series of preferred stock with
which the warrants are being offered and the number of warrants
being offered with each share of common stock or preferred
stock;
●
the date on and after which the holder of the warrants can transfer
them separately from the related common stock;
●
the number of shares of common stock or preferred stock that can be
purchased if a holder exercises the warrant and the price at which
such common stock or preferred stock may be purchased upon
exercise, including, if applicable, any provisions for changes to
or adjustments in the exercise price and in the securities or other
property receivable upon exercise;
●
the terms of any rights to redeem or call, or accelerate the
expiration of, the warrants;
●
the date on which the right to exercise the warrants begins and the
date on which that right expires;
●
federal income tax consequences of holding or exercising the
warrants; and
●
any other specific terms, preferences, rights or limitations of, or
restrictions on, the warrants.
Exercise of Warrants
Each holder of a warrant will be entitled to purchase the number of
shares of common stock or preferred stock, as the case may be, at
the exercise price described in the applicable prospectus
supplement or free writing prospectus. After the close of business
on the day when the right to exercise terminates (or a later date
if we extend the time for exercise), unexercised warrants will
become void.
A holder of warrants may exercise them by following the general
procedure outlined below:
●
delivering to the warrant agent the payment required by the
applicable prospectus supplement or free writing prospectus to
purchase the underlying security;
●
properly completing and signing the reverse side of the warrant
certificate representing the warrants; and
●
delivering the warrant certificate representing the warrants to the
warrant agent within five business days of the warrant agent
receiving payment of the exercise price.
If a holder complies with the procedures described above, such
warrants will be considered to have been exercised when the warrant
agent receives payment of the exercise price, subject to the
transfer books for the securities issuable upon exercise of the
warrant not being closed on such date. After the holder has
completed those procedures and subject to the foregoing, we will,
as soon as practicable, issue and deliver to such holder the common
stock or preferred stock purchased upon exercise. If the holder
exercises fewer than all of the warrants represented by a warrant
certificate, a new warrant certificate will be issued to the holder
for the unexercised amount of warrants. Holders of warrants will be
required to pay any tax or governmental charge that may be imposed
in connection with transferring the underlying securities in
connection with the exercise of the warrants.
Amendments and Supplements to the Warrant Agreements
We may amend or supplement a warrant agreement without the consent
of the holders of the applicable warrants to cure ambiguities in
the warrant agreement, to cure or correct a defective provision in
the warrant agreement, or to provide for other matters under the
warrant agreement that we and the warrant agent deem necessary or
desirable, so long as, in each case, such amendments or supplements
do not materially adversely affect the interests of the holders of
the warrants.
Warrant Adjustments
Unless the applicable prospectus supplement or free writing
prospectus states otherwise, the exercise price of, and the number
of securities covered by, a common stock or a preferred stock
warrant will be adjusted proportionately if we subdivide or combine
our common stock or preferred stock, as applicable. In addition,
unless the prospectus supplement or free writing prospectus states
otherwise, if we, without receiving payment:
●
issue capital stock or other securities convertible into or
exchangeable for common stock or preferred stock, or any rights to
subscribe for, purchase or otherwise acquire any of the foregoing,
as a dividend or distribution to holders of our common stock or
preferred stock;
●
pay any cash to holders of our common stock or preferred stock
other than a cash dividend paid out of our current or retained
earnings or other than in accordance with the terms of the
preferred stock;
●
issue any evidence of our indebtedness or rights to subscribe for
or purchase our indebtedness to holders of our common stock or
preferred stock; or
●
issue common stock or preferred stock or additional stock or other
securities or property to holders of our common stock or preferred
stock by way of spinoff, split-up, reclassification, combination of
shares or similar corporate rearrangement,
then the holders of common stock or preferred stock warrants will
be entitled to receive upon exercise of the warrants, in addition
to the securities otherwise receivable upon exercise of the
warrants and without paying any additional consideration, the
amount of stock and other securities and property such holders
would have been entitled to receive had they held the common stock
or preferred stock, as applicable, issuable under the warrants on
the dates on which holders of those securities received or became
entitled to receive such additional stock and other securities and
property.
Except as stated above or as otherwise set forth in the applicable
prospectus supplement or free writing prospectus, the exercise
price and number of securities covered by a common stock or
preferred stock warrant, and the amounts of other securities or
property to be received, if any, upon exercise of such warrant,
will not be adjusted or provided for if we issue those securities
or any securities convertible into or exchangeable for those
securities, or securities carrying the right to purchase those
securities or securities convertible into or exchangeable for those
securities.
Holders of common stock and preferred stock warrants may have
additional rights under the following circumstances:
●
certain reclassifications, capital reorganizations or changes of
the common stock or preferred stock, as applicable;
●
certain share exchanges, mergers, or similar transactions involving
us and which result in changes of the common stock or preferred
stock, as applicable; or
●
certain sales or dispositions to another entity of all or
substantially all of our property and assets.
If one of the above transactions occurs and holders of our common
stock or preferred stock are entitled to receive stock, securities
or other property with respect to or in exchange for their
securities, the holders of the common stock warrants and preferred
stock warrants then outstanding, as applicable, will be entitled to
receive, upon exercise of their warrants, the kind and amount of
shares of stock and other securities or property that they would
have received upon the applicable transaction if they had exercised
their warrants immediately before the transaction.
Series A1 Warrants
As
described above, we have issued Series A1 Warrants to purchase up
to 1,388,931 shares of our common
stock at an exercise price of $1.82 per share, which warrants
expire on or about March 7, 2023. The Series A1 Warrants Shares
that may become issuable from time to time upon the exercise of the
Series A1 Warrants are being offered pursuant to this prospectus.
For more information, see “Registration of Series A1
Warrants and Series A1 Warrant Shares” below.
Duration and Exercise Price: The Series A1 Warrants are exercisable for a
five-year period commencing on or about March 7, 2018, and have an
exercise price of $1.82 per share.
Exercisability: Each of
Series A1 Warrant may be exercised, in whole or in part, by
delivering to the Company a written notice of election to exercise
the applicable Series A1 Warrant and delivering to the Company cash
payment of the exercise price, if applicable. The exercise price
and the number of shares of our common stock issuable upon exercise
of the Series A1 Warrants is subject to adjustment in the event of
certain subdivisions and combinations, including by any stock split
or reverse stock split, stock dividend, recapitalization or
otherwise.
Cashless Exercise: If, at
any time during the term of the Series A1 Warrants, the issuance or
resale of shares of our common stock upon exercise of the Series A1
Warrants is not covered by an effective registration statement, the
holder is permitted to effect a cashless exercise of the Series A1
Warrants (in whole or in part) in which case the holder would
receive upon such exercise the net number of shares of common stock
determined according to the formula set forth in the Series A1
Warrants. Shares issued pursuant to a cashless exercise would be
deemed to have been issued pursuant to the exemption from
registration provided by Section 3(a)(9) of the Securities Act, and
the shares of common stock issued upon such cashless exercise would
take on the characteristics of the Series A1 Warrants being
exercised, including, for purposes of Rule 144(d) promulgated under
the Securities Act, a holding period beginning from the original
issuance date of the Series A1 Warrants.
Adjustment Provisions: The
exercise price and the number and type of securities purchasable
upon exercise of the Series A1 Warrants are subject to adjustment
upon certain corporate events, including certain subdivisions,
combinations and similar events If we declare any dividend or
distribution of assets (including cash, stock or other securities,
evidence of indebtedness, purchase rights or other property), each
holder of a Series A1 Warrant will be entitled to participate in
such distribution to the same extent that the holder would have
participated had the applicable Series A1 Warrant been exercised
immediately before the record date for the
distribution.
Transferability: Subject
to applicable laws, the Series A1 Warrants may be offered for sale,
sold, transferred or assigned without our consent. However, as of
the date of this prospectus there is no established trading market
for the Series A1 Warrants and it is not expected that a trading
market for the Series A1 Warrants will develop in the future.
Without an active trading market, the liquidity of the Series A1
Warrants will be limited.
Listing: We have not and
will not apply to list the Series A1 Warrants on Nasdaq Capital
Market. We do not intend to list the Series A1 Warrants on any
securities exchange or other quotation system. Without an
active market, the liquidity of the Series A1 Warrants will be
limited.
Rights as a stockholder: Except as set forth in the Series A1
Warrants or by virtue of such holders’ ownership of shares of
our common stock, the holders of the Series A1 Warrants do not have
the rights or privileges of holders of our common stock, including
any voting rights, until they exercise the Series A1
Warrants.
Limitations on Exercise: The exercise of the Series A1 Warrants may
be limited in certain circumstances if, after giving effect to such
exercise, the holder or any of its affiliates would beneficially
own (as determined in accordance with the terms of the Series A1
Warrants) more than 4.99% (or, at the election of the holder,
9.99%) of our outstanding common stock immediately after giving
effect to the exercise.
Fundamental Transactions: In the event of certain fundamental
transactions, as described in the Series A1 Warrants and generally
including any merger or consolidation with or into another entity,
the holders of the Series A1 Warrants shall thereafter have the
right to exercise the applicable Series A1 Warrant for the same
amount and kind of securities, cash or property as it would have
been entitled to receive upon the occurrence of such fundamental
transaction if it had been, immediately prior to such fundamental
transaction, the holder of shares of common stock issuable upon
exercise in full of the Series A1 Warrant. In the event of a Change
of Control (as defined in the Series A1 Warrants) (other than a
Change of Control which was not approved by our Board, as to which
this right shall not apply), at the request of the holder delivered
before the 30th day after such Change of Control, a holder of a
Series A1 Warrant will have the right to require us or any
successor entity to purchase the holder’s Series A1 Warrant
for the Black-Scholes Value of the remaining unexercised portion of
the Series A1 Warrant on the effective date of such Change of
Control (determined in accordance with a formula specified in the
Series A1 Warrants), payable in cash; provided, that if the
applicable Change of Control was not approved by our Board, such
amount shall be payable, at our option in either (x) shares of our
common stock or the consideration receivable by holders of common
stock in the Change of Control transaction, as applicable, valued
at the value of the consideration received by the shareholders in
such Change of Control, or (y) cash.
Dividends and Other Distributions: If we declare or make any dividend or other
distribution of our assets to holders of shares of our common stock
(including any distribution of cash, stock or other securities,
property, options, evidence of indebtedness or any other assets),
then, subject to certain limitation on exercise described in the
Series A1 Warrants, each holder of a Series A1 Warrant shall
receive the distributed assets that such holder would have been
entitled to receive in the distribution had the holder exercised
the Series A1 Warrant immediately prior to the record date for the
distribution.
Registration of Series A1 Warrants and Series A1 Warrant
Shares. The Series A1
Warrants and the Series A1 Warrant Shares were previously
registered pursuant to a prospectus supplement filed with the SEC
on August 31, 2017 pursuant to Rule 424(b)(5) under the Securities
Act, and pursuant to the Company’s effective shelf registration statements on
Form S-3 (File Nos. 333-215671 and
333-234025) (the Prior
Registration Statements), which were originally filed with
the Securities and Exchange Commission (the SEC) on January 23, 2017 and September
30, 2019, respectively, and declared effective by the SEC on July
27, 2017 and October 8, 2019, respectively. Pursuant to Rule
415(a)(6) and Rule 429 under the Securities Act, the offering of
the Series A1 Warrant Shares will be registered pursuant to this
registration statement.
DESCRIPTION OF OUR
UNITS
This section outlines some of the provisions of the units and the
unit agreements. This information may not be complete in all
respects and is qualified entirely by reference to the unit
agreement with respect to the units of any particular series. The
specific terms of any series of units will be described in the
applicable prospectus supplement or free writing prospectus. If so
described in a particular prospectus supplement or free writing
prospectus, the specific terms of any series of units may differ
from the general description of terms presented below.
As specified in the applicable prospectus supplement, we may issue
units consisting of one or more shares of common stock, shares of
our preferred stock, warrants or any combination of such
securities.
The applicable prospectus supplement will specify the following
terms of any units in respect of which this prospectus is being
delivered:
●
the terms of the units and of any of the shares of common stock,
shares of preferred stock, or warrants comprising the units,
including whether and under what circumstances the securities
comprising the units may be traded separately;
●
a description of the terms of any unit agreement governing the
units;
●
if appropriate, a discussion of material U.S. federal income tax
considerations; and
●
a description of the provisions for the payment, settlement,
transfer or exchange of the units.
DESCRIPTION OF CERTAIN PROVISIONS OF NEVADA LAW AND
OUR CHARTER AND BYLAWS
Transactions with Interested Persons
Under
the Nevada Revised Statutes (the NRS) a transaction with the Company (i)
in which a Company director or officer has a direct or indirect
interest, or (ii) involving another corporation, firm or
association in which one or more of the Company’s directors
or officers are directors or officers of the corporation, firm or
association or have a financial interest in the corporation firm or
association, is not void or voidable solely because of the
director’s or officer’s interest or common role in the
transaction if any one of the following circumstances
exists:
●
the
fact of the common directorship, office or financial interest is
known to our Board or a committee of our Board and a majority of
disinterested directors on the Board (or on the committee)
authorize, approved or ratify the transaction in good
faith;
●
the
fact of the common directorship, office or financial interest is
known to the stockholders and stockholders holding a majority of
the shares, including shares held by the common or interested
directors or officers, authorize, approve or ratify the transaction
in good faith;
●
the
fact of the common directorship, office or financial interest is
not known to the director or officer at the time the transaction is
brought to the Board for action; or
●
the
transaction is fair to the Company at the time it is authorized or
approved.
Anti-Takeover Provisions
Our
Charter and Nevada law include certain provisions which may have
the effect of delaying or deterring a change in control or in our
management or encouraging persons considering unsolicited tender
offers or other unilateral takeover proposals to negotiate with our
board of directors rather than pursue non-negotiated takeover
attempts. These provisions include authorized blank check preferred
stock, restrictions on business combinations, and the availability
of authorized but unissued common stock.
Combination with Interested Stockholders Statute
Sections
78.411 to 78.444 of the NRS, which apply to any Nevada corporation
which has at least 200 stockholders of record and is publicly
traded, including us, prohibits an “interested
stockholder” from entering into specified types of business
“combinations” with the Nevada corporation for two
years, unless certain conditions are met. A
“combination” includes:
●
any merger of the
corporation or any subsidiary of the corporation with an
“interested stockholder,” or any other entity, whether
or not itself an “interested stockholder,” which is, or
after and as a result of the merger would be, an affiliate or
associate of an “interested stockholder;”
●
any sale, lease,
exchange, mortgage, pledge, transfer, or other disposition in one
transaction, or a series of transactions, to or with an
“interested stockholder” or any affiliate or associate
of an “interested stockholder,” of assets of the
corporation or any subsidiary:
i.
having an aggregate
market value equal to more than 5% of the aggregate market value of
the corporation’s assets, determined on a consolidated
basis;
ii.
having an aggregate
market value equal to more than 5% of the aggregate market value of
all outstanding voting shares of the corporation; or
iii.
representing more
than 10% of the earning power or net income, determined on a
consolidated basis, of the corporation; or
●
the issuance or
transfer by the corporation or any subsidiary, of any shares of the
corporation or any subsidiary to an “interested
stockholder” or any affiliate or associate of an
“interested stockholder,” having an aggregate market
value equal to 5% or more of the aggregate market value of all of
the outstanding voting shares of the corporation, except under the
exercise of warrants or rights to purchase shares offered, or a
dividend or distribution paid or made, pro rata to all stockholders
of the resident domestic corporation;
●
the adoption of any
plan, or proposal for the liquidation or dissolution of the
corporation, under any agreement, arrangement or understanding,
with the “interested stockholder,” or any affiliate or
associate of the “interested stockholder;”
●
if any of the
following actions occurs
i.
a reclassification
of the corporation’s securities, including, without
limitation, any splitting of shares, share dividend, or other
distribution of shares with respect to other shares, or any
issuance of new shares in exchange for a proportionately greater
number of old shares;
ii.
recapitalization of
the corporation;
iii.
merger or
consolidation of the corporation with any subsidiary;
or
iv.
any other
transaction, whether or not with or into or otherwise involving the
interested stockholder,
under
any agreement, arrangement or understanding, whether or not in
writing, with the interested stockholder or any affiliate or
associate of the interested stockholder, which has the immediate
and proximate effect of increasing the proportionate share of the
outstanding shares of any class or series of voting shares or
securities convertible into voting shares of the corporation or any
subsidiary of the corporation which is beneficially owned by the
interested stockholder or any affiliate or associate of the
interested stockholder, except as a result of immaterial changes
because of adjustments of fractional shares; or
●
any receipt by an
“interested stockholder” or any affiliate or associate
of an “interested stockholder,” except proportionately
as a stockholder of the corporation, of the benefit of any loan,
advance, guarantee, pledge or other financial assistance or any tax
credit or other tax advantage provided by or through the
corporation.
An
“interested stockholder” is a person who
is:
●
directly or
indirectly, the beneficial owner of 10% or more of the voting power
of the outstanding voting shares of the corporation;
or
●
an affiliate or
associate of the corporation, which at any time within two years
immediately before the date in question was the beneficial owner,
directly or indirectly, of 10% or more of the voting power of the
then outstanding shares of the corporation.
A
corporation to which the Combinations with Interested Stockholders
Statute applies may not engage in a “combination”
within two years after the interested stockholder first became an
interested stockholder, unless the combination meets all of the
requirements of the corporation’s articles of incorporation
and (i) the combination or the transaction by which the person
first became an interested stockholder is approved by the board of
directors before the person first became an interested stockholder,
or (ii)(a) the combination is approved by the board of directors
and (b) at or after that time, the combination is approved at an
annual or special meeting of the stockholders, and not by written
consent, by the affirmative vote of the stockholders representing
at least 60% of the outstanding voting power of the corporation not
beneficially owned by the interested stockholder or the affiliates
or associates of the interested stockholder. If this approval is
not obtained, the combination may be consummated after the two year
period expires if either (i)(a) the combination or transaction by
which the person first became an interested stockholder is approved
by the board of directors before such person first became an
interested stockholder, (b) the combination is approved by a
majority of the outstanding voting power of the corporation not
beneficially owned by the interested stockholder or any affiliate
or associate of the interested stockholder, or (c) the
combination otherwise meets the requirements of the Combination
with Interested Stockholders statute. Alternatively, a combination
with an interested stockholder engaged in more than 2 years after
the date the person first became an interested stockholder may be
permissible if the aggregate amount of cash and the market
value of consideration other than cash to be received by holders of
shares of common stock and holders of any other class or series of
shares meets the minimum requirements set forth in the statue, and
prior to the completion of the combination, except in limited
circumstances, the interested stockholder has not become the
beneficial owner of additional voting shares of the
corporation.
Acquisition of Controlling Interest Statute
In
addition, Nevada’s “Acquisition of Controlling Interest
Statute,” prohibits an acquiror, under certain circumstances,
from voting shares of a target corporation’s stock after
crossing certain threshold ownership percentages, unless the
acquiror obtains the approval of the target corporation’s
stockholders. Sections 78.378 to 78.3793 of the NRS only apply to
Nevada corporations with at least 200 stockholders, including at
least 100 record stockholders who are Nevada residents, that do
business directly or indirectly in Nevada and whose articles of
incorporation or bylaws in effect ten days following the
acquisition of a controlling interest by an acquiror do not
prohibit its application.
We do
not intend to “do business” in Nevada within the
meaning of the Acquisition of Controlling Interest Statute.
Further, our Bylaws contain a specific opt out from the statute.
Therefore, we believe it is unlikely that this statute will apply
to us. The statute specifies three thresholds:
●
at least one-fifth
but less than one-third;
●
at least one-third
but less than a majority; and
●
a majority or more,
of the outstanding voting power.
Once an
acquiror crosses one of these thresholds, shares which it acquired
in the transaction taking it over the threshold (or within 90 days
preceding the date thereof) become “control shares”
which could be deprived of the right to vote until a majority of
the disinterested stockholders restore that right. A special
stockholders’ meeting may be called at the request of the
acquiror to consider the voting rights of the acquiror’s
shares. If the acquiror requests a special meeting and gives an
undertaking to pay the expenses of said meeting, then the meeting
must take place no earlier than 30 days (unless the acquiror
requests that the meeting be held sooner) and no more than 50 days
(unless the acquiror agrees to a later date) after the delivery by
the acquiror to the corporation of an information statement which
sets forth the range of voting power that the acquiror has acquired
or proposes to acquire and certain other information concerning the
acquiror and the proposed control share acquisition.
If no
such request for a stockholders’ meeting is made,
consideration of the voting rights of the acquiror’s shares
must be taken at the next special or annual stockholders’
meeting. If the stockholders fail to restore voting rights to the
acquiror, or if the acquiror fails to timely deliver an information
statement to the corporation, then the corporation may, if so
provided in its articles of incorporation or bylaws, call certain
of the acquiror’s shares for redemption at the average price
paid for the control shares by the acquiror.
Our
Charter and our Bylaws, as do not currently permit us to redeem an
acquiror’s shares under these circumstances. The Acquisition
of Controlling Interest Statute also provides that in the event the
stockholders restore full voting rights to a holder of control
shares that owns a majority of the voting stock, then all other
stockholders who do not vote in favor of restoring voting rights to
the control shares may demand payment for the “fair
value” of their shares as determined by a court in
dissenter’s rights proceeding pursuant to Chapter 92A of the
NRS.
PLAN OF DISTRIBUTION
We may sell the securities described in this prospectus to or
through underwriters or dealers, through agents, or directly to one
or more purchasers. A prospectus supplement or supplements (and any
related free writing prospectus that we may authorize to be
provided to you) will describe the terms of the offering of the
securities, including, to the extent applicable:
●
the
name or names of any underwriters or agents, if
applicable;
●
the
purchase price of the securities and the proceeds we will receive
from the sale;
●
any
over-allotment options under which underwriters may purchase
additional securities from us;
●
any
agency fees or underwriting discounts and other items constituting
agents’ or underwriters’ compensation;
●
any
public offering price;
●
any
discounts or concessions allowed or reallowed or paid to dealers;
and
●
any
securities exchange or market on which the securities may be
listed.
We may also sell equity securities covered by this registration
statement in an “at the market offering” as defined in
Rule 415 under the Securities Act. Such offering may be made into
an existing trading market for such securities in transactions at
other than a fixed price, either:
●
on
or through the facilities of the Nasdaq Capital Market or any other
securities exchange or quotation or trading service on which such
securities may be listed, quoted or traded at the time of sale;
and/or
●
to
or through a market maker otherwise than on the Nasdaq Capital
Market or such other securities exchanges or quotation or trading
services.
Such at-the-market offerings, if any, may be conducted by
underwriters acting as principal or agent.
Only underwriters named in a prospectus supplement are underwriters
of the securities offered by the prospectus
supplement.
If underwriters are used in the sale, they will acquire the
securities for their own account and may resell the securities from
time to time in one or more transactions at a fixed public offering
price or at varying prices determined at the time of sale. The
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,
the underwriters will be obligated to purchase all of the
securities offered by the prospectus supplement. Any public
offering price and any discounts or concessions allowed or
reallowed or paid to dealers may change from time to time. We may
use underwriters with whom we have a material relationship. We will
describe in the prospectus supplement that names the underwriter,
the nature of any such relationship.
We may sell securities directly or through agents we designate from
time to time. We will name any agent involved in the offering and
sale of securities, and we will describe any commissions we will
pay the agent in the prospectus supplement. Unless the prospectus
supplement states otherwise, our agent will act on a best-efforts
basis for the period of its appointment.
We may authorize agents or underwriters to solicit offers by
certain types of institutional investors to purchase securities
from us at the public offering price set forth in the prospectus
supplement pursuant to delayed delivery contracts providing for
payment and delivery on a specified date in the future. We will
describe the conditions to these contracts and the commissions we
must pay for solicitation of these contracts in the prospectus
supplement.
We may provide agents and underwriters with indemnification against
civil liabilities related to this offering, including liabilities
under the Securities Act, or contribution with respect to payments
that the agents or underwriters may make with respect to these
liabilities. Agents and underwriters may engage in transactions
with, or perform services for, us in the ordinary course of
business.
Any underwriter may engage in overallotment, stabilizing
transactions, short covering transactions and penalty bids in
accordance with Regulation M under the Securities Exchange Act of
1934, as amended (the Exchange
Act). 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
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 activities at any time.
Any underwriters who are qualified market makers on the Nasdaq
Capital Market may engage in passive market making transactions in
accordance with Rule 103 of Regulation M during the 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 passive market makers. In general, a passive market
maker must display its bid at a price not in 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.
LEGAL
MATTERS
Certain legal matters in connection with this offering will be
passed upon for us by Woodburn and Wedge, of Reno,
Nevada.
EXPERTS
OUM & Co. LLP, our independent registered public accounting
firm, has audited our consolidated financial statements included in
our Annual Report on Form 10-K for the year ended March 31, 2020,
as set forth in their report, which is incorporated by reference in
this prospectus. The report for VistaGen Therapeutics, Inc.
includes an explanatory paragraph about the existence of
substantial doubt concerning its ability to continue as a going
concern. Our financial statements are incorporated by reference in
reliance on OUM & Co. LLP’s report, given on their
authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are a public company and file annual, quarterly and special
reports, proxy statements and other information with the SEC. Our
SEC filings are available, at no charge, to the public at the
SEC’s website at
http://www.sec.gov.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by us with the SEC are incorporated
by reference in this prospectus:
●
our
Annual Report on Form 10-K for the year ended March 31, 2020, filed
on June 29, 2020;
●
our
Quarterly Report on Form 10-Q for the quarter ended June 30, 2020,
filed on August 13, 2020;
●
our
Quarterly Report on Form 10-Q for the quarter ended September 30,
2020, filed on November 12, 2020;
●
our
Quarterly Report on Form 10-Q for the quarter ended December 31,
2020, filed on February 11, 2021;
●
our
Definitive Proxy Statement on Schedule 14A, filed on July 27, 2020
(solely with respect to information required by Part III of our
Annual Report on Form 10-K for the year ended March 31, 2020, which
information shall update and supersede information included in Part
III of our Annual Report on Form 10-K for the year ended March 31,
2020);
●
our
Current Report on Form 8-K, filed on April 3, 2020;
●
our
Current Report on Form 8-K, filed on April 27, 2020;
●
our
Current Report on Form 8-K, filed on June 26, 2020;
●
our
Current Report on Form 8-K, filed on August 6, 2020;
●
our
Current Report on Form 8-K, filed on September 18,
2020;
●
our
Current Report on Form 8-K, filed on October 13, 2020;
●
our
Current Report on Form 8-K, filed on December 1, 2020;
●
our
Current Report on Form 8-K, filed on December 22,
2020;
●
our
Current Report on Form 8-K, filed on January 6, 2021;
●
our
Current Report on Form 8-K, filed on February 2, 2021;
●
our
Current Report on Form 8-K, filed on March 5, 2021;
and
●
The
description of our common stock contained in the Registration
Statement on Form 8-A filed pursuant to Section 12(b) of the
Exchange Act on May 3, 2016, including any amendment or report
filed with the SEC for the purpose of updating this
description.
We also incorporate by reference all documents we file pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than
any portions of filings that are furnished rather than filed
pursuant to Items 2.02 and 7.01 of a Current Report on Form 8-K)
after the date of the initial registration statement of which this
prospectus is a part and prior to effectiveness of such
registration statement. All documents we file in the future
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
after the date of this prospectus and prior to the termination of
the offering are also incorporated by reference (other than any
portions of filings that are furnished rather than filed pursuant
to Items 2.02 and 7.01 of a Current Report on Form 8-K) and are an
important part of this prospectus.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this registration statement to the
extent that a statement contained herein or in any other
subsequently filed document which also is or deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part
of this registration statement.
We will provide to each person, including any beneficial owner, to
whom a prospectus is delivered, a copy of any or all of the
information that has been incorporated by reference in the
prospectus but not delivered with the prospectus. You may request a
copy of these filings, excluding the exhibits to such filings which
we have not specifically incorporated by reference in such filings,
at no cost, by writing to or calling us at:
VistaGen Therapeutics, Inc.
343 Allerton Avenue
South San Francisco, California 94080
(650) 577-3600
This prospectus is part of a registration statement we filed with
the SEC. You should only rely on the information or representations
contained in this prospectus and any accompanying prospectus
supplement. We have not authorized anyone to provide information
other than that provided in this prospectus and any accompanying
prospectus supplement. We are not making an offer of the securities
in any state where the offer is not permitted. You should not
assume that the information in this prospectus or any accompanying
prospectus supplement is accurate as of any date other than the
date on the front of the document.
-28-
Up to
$75,000,000
Common Stock
PROSPECTUS SUPPLEMENT
Jefferies
May 14, 2021