athx20231129_424b3.htm

424B3 1 athx20231129_424b3.htm FORM 424B3 athx20231129_424b3.htm

Filed Pursuant to Rule 424(b)(3)

Registration No. 333-275458

PROSPECTUS

Up to 76,249,080 Shares of

Common Stock

Pursuant to this prospectus, the selling stockholders identified herein, or their permitted transferees that may be identified in this prospectus or by prospectus supplement (the “Selling Stockholders”), are offering on a resale basis, from time to time, up to 76,249,080 shares of common stock, par value $0.001 per share, of Athersys, Inc. (the “Company”), consisting of (i) 56,249,080 shares of common stock that are issuable upon the exercise of warrants to purchase shares of common stock at an original exercise price of $0.1395 per share and a current exercise price (after a reduction in the exercise price agreed to on October 30, 2023) of $0.01 per share (the “Inducement Warrants”) issued by us to the Selling Stockholders in a private placement of the Inducement Warrants which closed on October 16, 2023 pursuant to a letter agreement dated October 11, 2023 (the “Inducement Letter”), and (ii) 20,000,000 shares of common stock that are issuable upon exercise of certain warrants (the “October 30, 2023 Warrants” and, together with the Inducement Warrants, the “Subject Warrants”) to purchase shares of common stock at an exercise price of $0.01 per share issued by the Company on October 30, 2023 in a transaction pursuant to an offer letter dated October 30, 2023 (the “Letter Agreement”).

We are not offering any shares of our common stock for sale by us under this prospectus. We are registering the shares of common stock covered by this prospectus to be sold by the Selling Stockholders under the terms of the Inducement Letter and the Letter Agreement. We will not receive any proceeds from the sale of shares of common stock offered for resale by the Selling Stockholders.

The Selling Stockholders may sell the shares of our common stock covered by this prospectus from time to time through any of the means described in the section of this prospectus entitled “Plan of Distribution.” The prices at which the Selling Stockholders may sell the shares will be determined by the prevailing market price for the shares or in negotiated transactions.

Our common stock is quoted on the Pink Open Market tier operated by OTC Markets Group, Inc. (the “OTC Pink”) under the symbol “ATHX.” On November 21, 2023, the last reported sale price of our common stock on the OTC Pink was $0.0175 per share. We have applied to have our common stock quoted on the OTCQB Venture Market, but there is no assurance that our application will be accepted or as to the timing of any acceptance.

This prospectus describes the general manner in which shares of common stock may be offered and sold by the Selling Stockholders. When the Selling Stockholders sell shares of common stock under this prospectus, we may, if necessary and required by law, provide a prospectus supplement that will contain specific information about the terms of that offering. Any prospectus supplement may also add to, update, modify, or replace information contained in this prospectus. We urge you to carefully read this prospectus, any prospectus supplement, and any documents we incorporate by reference into this prospectus before you make your investment decision.

INVESTING IN OUR SECURITIES INVOLVES RISKS. YOU SHOULD REVIEW CAREFULLY THE RISKS AND UNCERTAINTIES DESCRIBED UNDER THE HEADING “RISK FACTORS” BEGINNING ON PAGE 3 OF THIS PROSPECTUS AND UNDER SIMILAR HEADINGS IN THE OTHER DOCUMENTS THAT ARE INCORPORATED BY REFERENCE INTO THIS PROSPECTUS.

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 November 29, 2023.

	Page
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS	ii
ABOUT THIS PROSPECTUS	1
SUMMARY	2
RISK FACTORS	3
USE OF PROCEEDS	5
DIVIDEND POLICY	5
DESCRIPTION OF SECURITIES	6
SELLING STOCKHOLDERS	7
PLAN OF DISTRIBUTION	8
LEGAL MATTERS	11
EXPERTS	11
WHERE YOU CAN FIND MORE INFORMATION	11
INFORMATION WE INCORPORATE BY REFERENCE	12

	●	our ability to raise capital to fund our operations in the near term and long term, including our ability to obtain funding through public or private equity offerings, debt financings, collaborations and licensing arrangements or other sources, on terms acceptable to us or at all, and to continue as a going concern;

	●	in the event we are unable in the near-term to enter into a strategic transaction or obtain adequate financing, we expect to have to file for protection under the bankruptcy laws to allow the Company to conduct an orderly wind down of operations;

	●	our collaborators’ ability and willingness to continue to fulfill their obligations under the terms of our collaboration agreements and generate sales related to our technologies;

	●	the possibility of unfavorable results from ongoing and additional clinical trials involving MultiStem;

	●	the risk that positive results in a clinical trial may not be replicated in subsequent or confirmatory trials or success in an early stage clinical trial may not be predictive of results in later stage or large scale clinical trials;

	●	the timing and nature of results from MultiStem clinical trials, including the MASTERS-2 Phase 3 clinical trial evaluating the administration of MultiStem for the treatment of ischemic stroke;

	●	our ability to meet milestones and earn royalties under our collaboration agreements, including the success of our collaboration with Healios;

	●	the success of our MACOVIA clinical trial evaluating the administration of MultiStem for the treatment of ARDS induced by COVID-19 and other pathogens, and the MATRICS-1 clinical trial being conducted with The University of Texas Health Science Center at Houston evaluating the treatment of patients with serious traumatic injuries;

	●	the availability of product sufficient to meet commercial demand shortly following any approval;

	●	the possibility of delays in, adverse results of, and excessive costs of the development process;

	●	our ability to successfully initiate and complete clinical trials of our product candidates;

	●	the possibility of delays, work stoppages or interruptions in manufacturing by third parties or us, such as due to material supply constraints, contaminations, operational restrictions due to COVID-19 or other public health emergencies, labor constraints, regulatory issues or other factors that could negatively impact our trials and the trials of our collaborators;

	●	uncertainty regarding market acceptance of our product candidates and our ability to generate revenues, including MultiStem cell therapy for neurological, inflammatory and immune, cardiovascular and other critical care indications;

	●	changes in external market factors;

	●	changes in our industry’s overall performance;

	●	changes in our business strategy;

	●	our ability to protect and defend our intellectual property and related business operations, including the successful prosecution of our patent applications and enforcement of our patent rights, and operate our business in an environment of rapid technology and intellectual property development;

	●	the possibility that we will not be able to be successful in our defense of active litigation;

	●	our possible inability to realize commercially valuable discoveries in our collaborations with pharmaceutical and other biotechnology companies;

	●	the success of our efforts to enter into new strategic partnerships and advance our programs;

	●	our possible inability to execute our strategy due to changes in our industry or the economy generally;

	●	changes in productivity and reliability of suppliers;

	●	the success of our competitors and the emergence of new competitors;

	●	our ability to maintain quotation of our common stock on the OTC Pink;

	●	our ability to identify, evaluate, and complete any strategic alternative that yields value for our stockholders; and

	●	the risks described in our Annual Report on Form 10-K for the year ended December 31, 2022, under Item 1A, “Risk Factors” and our other filings with the SEC.

Common Stock Offered by the Selling Stockholders:		We are registering the resale by the Selling Stockholders named in this prospectus, or their permitted transferees, up to 76,249,080 shares of common stock consisting of (i) 56,249,080 shares of common stock that are issuable upon the exercise the Inducement Warrants issued by us to the Selling Stockholders in a private placement of the Inducement Warrants which closed on October 16, 2023 pursuant the Inducement Letter, and (ii) 20,000,000 shares of common stock that are issuable upon exercise of the October 30, 2023 Warrants issued by the Company on October 30, 2023 pursuant to the Letter Agreement.

Plan of Distribution:		The Selling Stockholders will determine when and how it will sell the common stock offered in this prospectus, as described in “Plan of Distribution” section of this prospectus.

Use of Proceeds:		We will not receive any proceeds from the sale of shares of our common stock by the Selling Stockholders.

Risk Factors:		Before investing in our securities, you should carefully read and consider the information set forth in the “Risk Factors” section of this prospectus and under similar headings in any amendments or supplements to this prospectus and the documents incorporated herein by reference.

OTC Pink symbol:		ATHX

	(1)	Assumes the sale of all shares of common stock offered pursuant to this prospectus. Such number includes (i) 2,505,358 shares of common stock known by us to be held by such Selling Stockholder as of the date of this prospectus; (ii) 5,022,000 shares of common stock that are held in abeyance until the Selling Stockholder notifies us that the issuance of such shares would not result in the Selling Stockholder beneficially owning in excess of 4.99% of our common stock and (iii) 3,370,000 shares of common stock issuable upon exercise of warrants exercisable within 60 days of November 21, 2023.

	(2)	Such percentage assumes total shares issued and outstanding after the offering is 137,967,895, which number includes 5,022,000 shares of common stock that are held in abeyance until the Selling Stockholder notifies us that the issuance of such shares would not result in the Selling Stockholder beneficially owning in excess of 4.99% of our common stock. Such percentage also includes, for purposes of beneficial ownership, 3,370,000 shares of common stock issuable upon exercise of warrants exercisable within 60 days of November 21, 2023.

	(3)	The securities are directly held by Armistice Capital Master Fund Ltd., a Cayman Islands exempted company (the “Master Fund”), and may be deemed to be beneficially owned by: (i) Armistice Capital, LLC (“Armistice Capital”), as the investment manager of the Master Fund; and (ii) Steven Boyd, as the Managing Member of Armistice Capital. The warrants are subject to a beneficial ownership limitation of 4.99%, which such limitation restricts the Selling Stockholder from exercising that portion of the warrants that would result in the Selling Stockholder and its affiliates owning, after exercise, a number of shares of common stock in excess of the beneficial ownership limitation. The address of Armistice Capital Master Fund Ltd. is c/o Armistice Capital, LLC, 510 Madison Avenue, 7th Floor, New York, NY 10022.

	(4)	Includes (i) 2,505,358 shares of common stock known by us to be held by such Selling Stockholder as of the date of this prospectus; (ii) 5,022,000 shares of common stock that are held in abeyance until the Selling Stockholder notifies us that the issuance of such shares would not result in the Selling Stockholder beneficially owning in excess of 4.99% of our common stock; (iii) 3,370,000 shares of common stock issuable upon exercise of warrants exercisable within 60 days of November 21, 2023; and (iv) the shares of common stock that are being registered hereunder that are issuable upon exercise of the Subject Warrants, in each case without giving effect to any beneficial ownership limitations that may exist on such warrants.

	●	through underwriters or dealers for resale to the public or to investors;

	●	directly to one or more purchasers;

	●	through agents;

	●	in “at the market” offerings, within the meaning of Rule 415(a)(4) of the Securities Act, to or through a market maker or into an existing trading market on an exchange or otherwise;

	●	in block trades;

	●	through public or privately negotiated transactions; or

	●	any other method permitted pursuant to applicable law.

	●	on any national securities exchange or quotation service on which our common stock may be listed or quoted at the time of sale or in the over-the-counter market;

	●	in transactions other than on a national securities exchange or quotation service or in the over-the-counter market;

	●	in block transactions in which the broker or dealer so engaged will attempt to sell the shares of common stock as agent but may position and resell a portion of the block as principal to facilitate the transaction, or in crosses, in which the same broker acts as an agent on both sides of the trade;

	●	in ordinary brokerage transactions in which the broker-dealer solicits purchasers;

	●	through purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

	●	through the writing of options, convertible securities or other contracts or agreements to be satisfied by the delivery of shares of common stock;

	●	through short sales;

	●	through privately negotiated transactions;

	●	through an exchange distribution in accordance with the rules of the applicable exchange;

	●	through broker-dealers who may agree with any Selling Stockholder to sell a specified number of its shares at a stipulated price per share;

	●	through the lending of such securities;

	●	by pledge to secure debts and other obligations or on foreclosure of a pledge;

	●	through the distribution of such securities by any Selling Stockholder to its stockholders;

	●	through a combination of any of the above methods; or

	●	through any other method permitted pursuant to applicable law.

	●	our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on April 3, 2023;

	●	our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2023, June 30, 2023, and September 30, 2023 (as filed with the SEC on May 15, 2023, August 16, 2023, and November 16, 2023, respectively);

	●	our Current Reports on Form 8-K and/or amendments thereto (other than any portions thereof deemed furnished and not filed), as filed with the SEC on January 5, 2023, January 25, 2023, April 14, 2023, April 18, 2023, May 23, 2023, June 28, 2023, July 5, 2023, July 14, 2023, July 31, 2023, August 8, 2023, August 10, 2023, August 11, 2023, August 18, 2023, September 11, 2023, September 19, 2023, October 2, 2023, October 3, 2023, October 11, 2023, October 12, 2023, October 18, 2023, and October 30, 2023;

	●	our Definitive Proxy Statement on Schedule 14A, as filed with the SEC on August 17, 2023; and

	●	the description of our common stock set forth in the registration statement on Form 8-A filed with the SEC on December 6, 2007, as updated by Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 24, 2022, and all amendments and reports filed for the purpose of updating that description.

SEC Form 424B3 filed by Athersys Inc.