UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): December 28, 2010
AEOLUS PHARMACEUTICALS,
INC.
(Exact
name of registrant as specified in its charter)
Delaware
(State or
other jurisdiction of incorporation)
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0-50481
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56-1953785
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(Commission
File Number)
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(IRS
Employer Identification
No.)
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26361
Crown Valley Parkway, Suite 150
Mission
Viejo, California 92691
(Address
of Principal Executive Offices, Including Zip Code)
949-481-9825
(Registrant’s
Telephone Number, Including Area Code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General
Instruction A.2. below):
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
3.02. Unregistered
Sales of Equity Securities.
Pursuant
to a Securities Purchase Agreement, by and among Aeolus Pharmaceuticals, Inc.
(the “Company”) and two accredited institutional investors (the “Investors”)
dated as of August 11, 2010 (the “Purchase Agreement”), the Company granted to
the Investors, severally and not jointly, an option (the “Call Option”) to
require the Company to sell to the Investors up to 2,500,000 units (the
“Units”), comprised of an aggregate of 2,500,000 shares (the “Shares”) of common
stock, par value $0.01 per share, of the Company (“Common Stock”) and warrants
to purchase up to an aggregate of 1,875,000 additional shares of Common Stock
(the “Warrants”), with an initial exercise price of $0.50 per share, subject to
adjustment as provided in the Warrants, with each Unit representing one share of
Common Stock and a Warrant to purchase 0.75 of one share of Common
Stock. On December 27, 2010, the Investors gave written notice to the
Company that they were exercising the Call Option in full, effective as soon as
possible after the date of the written notice. In accordance with the
terms of the Call Option and the Purchase Agreement, on December 28, 2010, the
Company sold and issued to the Investors in a private placement an aggregate of
2,500,000 Shares and 1,875,000 Warrants (the “Financing”). The
Warrants are exercisable for a seven-year period from their date of issuance;
contain a “cashless exercise” feature that allows the holder to exercise the
Warrants without a cash payment to the Company under certain circumstances;
contain a dividend participation right which allows the holder to receive any
cash dividends paid on the Common Stock without exercising the Warrant; contain
a provision that provides for the reduction of the exercise price to $0.01 in
the event of any such payment of cash dividends by the Company or upon a change
of control; and contain anti-dilution provisions in the event of a stock
dividend or split, dividend payment or other issuance, reorganization,
recapitalization or similar event.
The Units
were issued and sold to the Investors at a purchase price of $0.40 per Unit for
aggregate gross proceeds to the Company of $1,000,000. The net proceeds to the
Company from the Financing, after deducting for expenses, were approximately
$990,000. The Company intends to use the net proceeds from the Financing to
finance animal efficacy studies in Acute Radiation Syndrome and the development
of AEOL 10150 and to fund ongoing operations of the Company.
The
securities described in this Item 3.02 were offered and sold in reliance upon
exemptions from registration pursuant to Section 4(2) under the Securities Act
of 1933, as amended (the “Securities Act”), and Rule 506 promulgated thereunder,
and thus have not been registered under the Securities Act. The securities may
not be offered or sold in the United States absent registration or an applicable
exemption from the registration requirements of the Securities Act. The
agreements executed in connection with the Financing contain representations to
support the Company’s reasonable belief that each Investor had access to
information concerning the Company’s operations and financial condition, each
Investor acquired the securities for its own account and not with a view to the
distribution thereof in the absence of an effective registration statement or an
applicable exemption from registration, and that each Investor is sophisticated
within the meaning of Section 4(2) of the Securities Act and an “accredited
investor” (as defined by Rule 501 under the Securities Act). In addition, the
issuances did not involve any public offering; the Company made no solicitation
in connection with the Financing other than communications with the Investors;
the Company did not use any form of advertising in connection with the
Financing; the Company obtained representations from each Investor regarding its
investment intent, experience and sophistication; and each Investor either
received or had access to adequate information about the Company in order to
make informed investment decisions. At the time of their issuance,
the securities were deemed to be restricted securities for purposes of the
Securities Act, and the certificates representing the securities bear legends to
that effect.
Affiliates
of Xmark Opportunity Partners, LLC were the sole investors in the Financing.
Together with its affiliates, Xmark Opportunity Partners, LLC beneficially
owned approximately 68.1% of the outstanding shares of Common Stock prior to the
Financing. Xmark Opportunity Partners, LLC is the sole manager of
Goodnow Capital, L.L.C. (“Goodnow”) and possesses sole power to vote and direct
the disposition of all securities of the Company held by Goodnow. Goodnow has
the right to designate up to two directors for election to the Company’s Board
of Directors pursuant to the terms of a purchase agreement between Goodnow and
the Company. David C. Cavalier, a current director and employee of the Company, is President
of Goodnow.
The
foregoing description of the Financing is not complete and is qualified in its
entirety by reference to full texts of the Purchase Agreement and the form of
Warrant, each incorporated herein by reference, copies of which were filed as
Exhibit 10.1 and Exhibit 10.2, respectively, to the Company’s Current Report on
Form 8-K that was filed with the Securities and Exchange Commission on August
12, 2010.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
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Exhibit
#
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Description
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10.1
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Securities Purchase Agreement
dated August 11, 2010 by and among the Company and the investors whose
names appear on the signature pages thereof (1)
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10.2
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Form
of Warrant to Purchase Common Stock
(2)
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(1)
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Incorporated by reference to
Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on August 12,
2010.
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(2)
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Incorporated by reference to
Exhibit 10.2 of the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on August 12,
2010.
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SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this Report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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Date: December
28, 2010
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AEOLUS
PHARMACEUTICALS, INC.
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/s/ John L. McManus
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John
L. McManus
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President
and Chief Executive Officer
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