Item 4. Purpose of Transaction
Percent of class:
Astellas
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8.7%
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Astellas Holding
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8.7%
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Astellas US
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8.7%
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The percentage ownership was calculated based upon the sum of (i) 86,916,199 shares of the Issuer’s common stock outstanding as of August 4,
2023, as reported in the Issuer’s Quarterly Report on Form 10-Q filed on August 8, 2023 and (ii) an additional 8,333,333 shares of the Issuer’s common stock outstanding following the closing of the private placement pursuant to the Securities
Purchase Agreement.
Number of shares of the Issuer’s common stock as to which such person has:
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(i)
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Sole power to vote or to direct the vote:
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Astellas
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0 shares
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Astellas Holding
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0 shares
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Astellas US
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0 shares
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(ii)
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Shared power to vote or to direct the vote:
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Astellas
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8,333,333 shares
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Astellas Holding
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8,333,333 shares
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Astellas US
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8,333,333 shares
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(iii)
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Sole power to dispose or to direct the disposition of:
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Astellas
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0 shares
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Astellas Holding
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0 shares
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Astellas US
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0 shares
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(iv)
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Shared power to dispose or to direct the disposition of:
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Astellas
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8,333,333 shares
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Astellas Holding
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8,333,333 shares
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Astellas US
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8,333,333 shares
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To the knowledge of the Reporting Persons, none of the individuals listed on Schedule I beneficially owns any of the Issuer’s common stock.
(c) Except as reported in this Statement, to the knowledge of the Reporting Persons, neither the Reporting Persons nor any of the individuals listed on Schedule I have effected any transactions
in the Issuer’s common stock during the past sixty (60) days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with respect to Securities of the Issuer
The information set forth in Items 3 and 4 of this Statement is incorporated by reference into this Item 6. Capitalized terms used but not defined in this Item 6 are defined in Item 3.
Securities Purchase Agreement
On August 4, 2023, the Issuer and Astellas US entered into the Securities Purchase Agreement, pursuant to which the Issuer agreed to issue and sell to Astellas US in a private placement an aggregate of 8,333,333
shares of common stock of the Issuer (the “Shares”), for aggregate gross proceeds of approximately $25.0 million. The transaction closed on August 7, 2023 (the “Closing Date”). The Securities Purchase Agreement contains customary representations, warranties and agreements by the Issuer, customary representations, warranties
and agreements by the Astellas US, customary conditions to closing, indemnification obligations of the Issuer and other obligations of the parties.
Pursuant to the Securities Purchase Agreement, the Reporting Persons may not, without the prior written consent of the Issuer, during the period commencing on the Closing Date and ending on the date that is 180
days after the Closing Date (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of,
directly or indirectly, any shares of the Issuer’s common stock; or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any shares of the Issuer’s common
stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of the Issuer’s common stock or other securities, in cash or otherwise (the “Lock-up”). The Lock-up is subject to certain limited exceptions, including the ability to transfer shares to affiliates of Astellas US and certain related persons; provided the transferee agrees to be bound by such
restrictions.
The foregoing description of the Securities Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to such agreement, a copy of which is attached hereto as Exhibit 3 and
incorporated into this Item 6 by reference.
Registration Rights Agreement
On August 4, 2023, the Issuer and Astellas US entered into a registration rights agreement, attached hereto as Exhibit 4 (the “Registration Rights Agreement”), pursuant to which the Issuer agreed to register the resale of the Shares. Under the Registration Rights Agreement, the Issuer has
agreed to file a registration statement covering the resale of the Shares no later than April 13, 2024. The Issuer has agreed to use reasonable best efforts to cause such registration statement to become effective as promptly as practicable
after the filing thereof but in any event on or prior to the Effectiveness Deadline (as defined in the Registration Rights Agreement), and to keep such registration statement continuously effective until the earlier of (i) the date the Shares
covered by such registration statement have been sold or may be resold pursuant to Rule 144 without restriction, or (ii) the date that is three (3) years following the Closing Date. The Issuer has also agreed, among other things, to pay all
reasonable fees and expenses (excluding any underwriters’ discounts and commissions and all fees and expenses of legal counsel, accountants and other advisors for Astellas US except as specifically provided in the Registration Rights Agreement)
incident to the performance of or compliance with the Registration Rights Agreement by the Issuer.
The Issuer and Astellas US granted each other customary indemnification rights in connection with the registration statement. The Issuer made
additional customary covenants, including with respect to “piggyback” registrations, cooperating in underwritten offerings of the Shares and taking steps to allow the Shares to be resold pursuant to Rule 144 under the Securities Act of 1933.
The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference
to such agreement, a copy of which is attached hereto as Exhibit 4 and incorporated into this Item 6 by reference.
Strategic Rights Letter Agreement
On August 4, 2023, the Issuer and Astellas US entered into the Strategic Rights Letter. Pursuant to the Strategic Rights Letter, the Issuer
granted Astellas US the right to designate a representative, reasonably acceptable to the Issuer, to attend meetings and receive related materials provided thereto of the Issuer’s board of directors (the “Board”), any committee of the
Board, and the Issuer’s scientific advisory board, subject to certain customary exceptions. The rights described in this sub-section are referred to in this Statement as the “Board Observer Rights.”
During the period beginning on the Closing Date and ending on the 12-month anniversary of the Closing Date (the “Exclusivity Period”), the Issuer has agreed not to (i) solicit, knowingly encourage, negotiate or otherwise enter into bona fide discussions about a Program Transaction with any third party, (ii)
provide access to any confidential information of the Issuer relating to P-MUC1C-ALLO1, the Issuer’s fully allogeneic CAR-T product candidate for multiple solid tumor indications (the “Program”),
for purposes of knowingly facilitating a Program Transaction, or (iii) enter into any letter of intent, contract or other commitment for a Program Transaction. The rights described in this sub-section are referred to in this Statement as the “Exclusivity Rights.”
Further, pursuant to the Strategic Rights Letter, the Issuer has agreed to provide notice to Astellas US (i) if the Issuer receives a bona
fide proposal for a Change in Control (as defined in the Strategic Rights Letter) transaction from a third party, unless such proposal is rejected by the Board, or (ii) of the commencement of a process approved by the Board for a Change in
Control, (iii) if the Issuer receives a bona fide proposal for a Program Transaction from a third party unless the proposal is rejected by the Board (a “Program Transaction Proposal”)
or, (iv) following the Exclusivity Period, the commencement of substantive discussions for a Program Transaction with a third party in connection with a process approved by the Board for a Program Transaction (a “Program Process”). In connection with a notice related to (x) a Program Transaction Proposal, Astellas shall have a right of first refusal to provide a competing proposal that is in aggregate more
favorable to the Issuer than the Program Transaction Proposal, and thereby have a right to negotiate exclusively a possible Program Transaction for a specified period and (y) a Program Process, Astellas US shall have a right of first offer to
negotiate a Program Transaction for a specified period before the Issuer engages with any third party in meaningful substantive discussions, in each case, in accordance with the procedures and subject to the conditions set forth in the
Strategic Rights Letter. The rights described in this sub-section are referred to in this Statement as the “Strategic Transaction Rights.”
This Strategic Rights Letter shall terminate upon the earliest to occur of (i) the 18-month anniversary of the Closing Date, (ii) such time
that Astellas US owns fewer than 8,000,000 shares of the Issuer’s common stock (subject to adjustment for any stock splits, stock dividends or recapitalizations) and (iii) the consummation of a Change in Control.
The foregoing description of the Strategic Rights Letter does not purport to be complete and is qualified in its entirety by reference to such
agreement, a copy of which is attached hereto as Exhibit 5 and incorporated into this Item 6 by reference.
Standstill Agreement
In connection with the private placement and the transactions contemplated by the Strategic Rights Letter, Astellas US also entered into a
standstill agreement with the Issuer (the “Standstill Agreement”) pursuant to which, for a period of 18 months from August 4, 2023, Astellas US will not (subject to certain exceptions):
(a)
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make, effect, initiate, cause or participate in (i) any acquisition of beneficial ownership of any securities of the
Issuer or any securities (including derivatives thereof) of any subsidiary or other affiliate of the Issuer other than the securities to be acquired from the Issuer pursuant to the Securities Purchase Agreement, (ii) any
acquisition of any assets of the Issuer or any assets of any subsidiary, division or other affiliate of the Issuer, (iii) any tender offer, exchange offer, merger, business combination, recapitalization, restructuring,
liquidation, dissolution or extraordinary transaction involving the Issuer or any subsidiary or other controlled affiliate of the Issuer or involving any securities or assets of the Issuer or any securities or assets of any
subsidiary, division or other affiliate of the Issuer (iv) any “solicitation” of “proxies” (as those terms are used in the proxy rules of the Securities and Exchange Commission) or consents with respect to any securities of the
Issuer;
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(b)
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form, join or participate in a “group” (as defined in the Securities Exchange Act of 1934, as amended, and the rules
promulgated thereunder) with respect to the beneficial ownership of any securities of the Issuer or any subsidiary or division of the Issuer;
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(c)
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act, alone or in concert with others, to seek to control or influence the management, Board or policies of the Issuer;
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(d)
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take any action that might require the Issuer to make a public announcement regarding any of the types of matters set
forth in clause “(a)” above;
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(e)
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agree or offer to take, or encourage or propose (publicly or otherwise) the taking of, any action referred to in clause
“(a)”, “(b)”, “(c)” or “(d)” above;
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(f)
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assist, induce or encourage any other person to take any action of the type referred to in clause “(a)”, “(b)”, “(c)”,
“(d)” or “(e)” above;
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(g)
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enter into any discussion, negotiation, arrangement or agreement with any other person relating to any of the foregoing;
or
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(h)
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request or propose (either directly or indirectly) that the Issuer or any of the Issuer’s Representatives amend, waive or
consider the amendment or waiver of any provision set forth in the Standstill Agreement.
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The foregoing description of the Standstill Agreement does not purport to be complete and is qualified in its entirety by
reference to such agreement, a copy of which is attached hereto as Exhibit 6 and incorporated into this Item 6 by reference.
Item 7. Material to Be Filed as Exhibits
Exhibit 1
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Power of Attorney (Astellas Pharma Inc.) (incorporated by reference to Exhibit 1 to the Schedule 13D filed by Audentes Therapeutics Inc.,
SEC File No. 005-91724, filed October 31, 2022).
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Exhibit 2
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Joint Filing Agreement among Astellas Pharma Inc., Astellas US Holding, Inc. and Astellas US LLC
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Exhibit 3
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Securities Purchase Agreement between the Issuer and Astellas US LLC, dated August 4, 2023 (incorporated by reference to Exhibit 10.1 to
the Issuer’s Current Report on Form 8-K, SEC File No. 001-39376, filed August 7, 2023).
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Exhibit 4
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Registration Rights Agreement between the Issuer and Astellas US LLC, dated August 4, 2023 (incorporated by reference to Exhibit 10.2 to
the Issuer’s Current Report on Form 8-K, SEC File No. 001-39376, filed August 7, 2023).
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Exhibit 5
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Strategic Rights Letter Agreement between the Issuer and Astellas US LLC, dated August 4, 2023 (incorporated by reference to Exhibit 10.3
to the Issuer’s Current Report on Form 8-K, SEC File No . 001-39376, filed August 7, 2023).
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Exhibit 6
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Standstill Agreement between the Issuer and Astellas US LLC, dated August 4, 2023.
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