Quoin Pharma Sells Unregistered Equity, Dilution Risk Looms

TL;DR

**Quoin Pharma just sold more shares privately, expect potential dilution.**

AI Summary

On January 25, 2024, Quoin Pharmaceuticals, Ltd. entered into a material definitive agreement for an unregistered sale of equity securities. This means the company sold shares directly to investors without a public offering, which can dilute the value of existing shares. This matters to investors because it could signal a need for capital and potentially impact the stock price due to increased share count.

Why It Matters

This unregistered sale of equity increases the total number of shares outstanding, which can dilute the ownership stake and earnings per share for current shareholders.

Risk Assessment

Risk Level: medium — The sale of unregistered equity can lead to dilution for existing shareholders and may indicate the company is seeking capital outside of traditional public offerings.

Analyst Insight

A smart investor would monitor Quoin Pharmaceuticals' stock for potential dilution effects and further details on the terms of the unregistered equity sale to assess its impact on per-share value.

Key Players & Entities

• Quoin Pharmaceuticals, Ltd. (company) — the registrant filing the 8-K
• January 25, 2024 (date) — date of the earliest event reported regarding the equity sale
• 001-37846 (other) — Commission File Number for Quoin Pharmaceuticals, Ltd.

Forward-Looking Statements

• Quoin Pharmaceuticals' stock price may experience downward pressure due to potential dilution from the unregistered equity sale. (Quoin Pharmaceuticals, Ltd.) — medium confidence, target: Q1 2024

FAQ

Key Financial Figures

• $8,000,000 — y has the right to sell to Alumni up to $8,000,000 (the "Commitment Amount") of newly issu
• $4,000,000 — se notices for an aggregate of at least $4,000,000 of the Commitment Amount prior to the e
• $500,000 — ll not exceed a number of ADSs equal to $500,000 divided by the dollar volume-weighted a
• $5,000,000 — ation to a number of ADSs not to exceed $5,000,000 divided by the dollar volume-weighted a
• $1.00 — urchase price be below a floor price of $1.00 per share (subject to adjustment as pro
• $240,000 — e at the time of issuance not to exceed $240,000 in the aggregate (the "Commitment Secur

Filing Documents

• tm244426d1_8k.htm (8-K) — 41KB
• tm244426d1_ex10-1.htm (EX-10.1) — 207KB
• 0001104659-24-008229.txt ( ) — 466KB
• qnrx-20240125.xsd (EX-101.SCH) — 3KB
• qnrx-20240125_lab.xml (EX-101.LAB) — 33KB
• qnrx-20240125_pre.xml (EX-101.PRE) — 22KB
• tm244426d1_8k_htm.xml (XML) — 3KB

01. Entry Into a Material Definitive Agreement

Item 1.01. Entry Into a Material Definitive Agreement. On January 25, 2024, Quoin Pharmaceuticals Ltd. (the "Company" or "we") entered into a Purchase Agreement (the "Purchase Agreement") with Alumni Capital LP ("Alumni"). Pursuant to the Purchase Agreement, the Company has the right to sell to Alumni up to $8,000,000 (the "Commitment Amount") of newly issued ordinary shares that are represented by American Depositary Shares ("ADSs") (the "Purchase Notice Securities"), subject to certain conditions and limitations, from time to time during the term of the Purchase Agreement. ADSs may be sold by the Company pursuant to the Purchase Agreement over a period beginning on the later of (i) the date that a registration statement that we agreed to file with the Securities and Exchange Commission ("SEC") pursuant to the Purchase Agreement is declared effective by the SEC, and (ii) the date that shareholder approval of the issuance of ADSs under the Purchase Agreement is obtained (such later date, the "Initiation Date") and ending on the earlier of (i) the date on which Alumni has purchased ADSs pursuant to the Purchase Agreement for an aggregate purchase price of the Commitment Amount, and (ii) the 90th day after the Initiation Date; provided, however, that the Company has the option at its sole discretion to extend such period by up to an additional 90 days by written notice to Alumni given at least ten days prior to the end of the original 90 day period (such period, including any extension, the "Commitment Period"). If shareholder approval of the issuance of ADSs under the Purchase Agreement is not obtained by April 30, 2024, the Company may terminate the Purchase Agreement by written notice to Alumni and neither party shall have any obligation or liability to the other party. Upon the satisfaction of the conditions in the Purchase Agreement, we will have the right, but not the obligation, except as provided in the next sentence, from time to time at our sole discreti

02. Unregistered Sales

Item 3.02. Unregistered Sales of Equity Securities. The information set forth under Item 1.01 above of this Current Report on Form 8-K is incorporated by reference in this Item 3.02. The ADSs to be issued under the Purchase Agreement will be sold pursuant to an exemption from the registration requirements under Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder. The ADSs have not been registered under the Securities Act and may not be offered or sold in the United States in the absence of an effective registration statement or exemption from the registration requirements.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits. Exhibit No. Description 10.1 Purchase Agreement between the Company and Alumni Capital LP dated January 25, 2024 104 Cover Page Interactive Data file (embedded within the Inline XBRL document)

SIGNATURES

SIGNATURES 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. Date: January 30, 2024 QUOIN PHARMACEUTICALS LTD. By: /s/ Gordon Dunn Name: Gordon Dunn Title: Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR