Contingent Value Rights Agreement
The Merger Agreement contemplates that within 30 days following the Closing, the Company and the Rights Agent (as defined therein) will execute and deliver a
contingent value rights agreement (the CVR Agreement), pursuant to which each holder of Common Stock as of the applicable record time shall be entitled to one contractual contingent value right issued by the Company, subject to
and in accordance with the terms and conditions of the CVR Agreement, for each share of Common Stock held by such holder. Each contingent value right shall entitle the holder thereof to receive certain cash payments from the net proceeds, if any,
related to the disposition of the Companys legacy programs following the Closing. The contingent value rights are not transferable, except in certain limited circumstances as will be provided in the CVR Agreement, will not be certificated or
evidenced by any instrument and will not be registered with the SEC or listed for trading on any exchange.
The foregoing description of the CVR Agreement
does not purport to be complete and is qualified in its entirety by reference to the form of the CVR Agreement, which is provided as Exhibit D to the Merger Agreement, which is filed as Exhibit 99.2 to this Schedule 13D and incorporated herein by
reference.
Private Placement and Securities Purchase Agreement
On June 22, 2023, the Company entered into a Securities Purchase Agreement (the Purchase Agreement) with the purchasers named therein
(the Investors). Pursuant to the Purchase Agreement, the Company agreed to sell an aggregate of 721,452 shares of Series A Preferred Stock for an aggregate purchase price of approximately $210,000,000 (collectively, the
Financing). Each share of Series A Preferred Stock is convertible into 1,000 shares of Common Stock. The powers, preferences, rights, qualifications, limitations and restrictions applicable to the Series A Preferred Stock are set
forth in the Certificate of Designations. The closing of the Financing is expected to occur on June 26, 2023 (the Financing Closing Date).
The foregoing summary of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement, which
is filed as Exhibit 99.4 to this Schedule 13D.
Registration Rights Agreement
On the Financing Closing Date, in connection with the Purchase Agreement, the Company entered into a Registration Rights Agreement (the Registration
Rights Agreement) with the Investors. Pursuant to the Registration Rights Agreement, the Company is required to prepare and file a resale registration statement with the SEC within 45 calendar days following the Financing Closing Date. The
Company has also agreed to, among other things, indemnify the Investors, their officers, directors, members, employees, partners, managers, stockholders, affiliates, investment advisors and agents under the registration statement from certain
liabilities and pay all fees and expenses (excluding any legal fees of the selling holder(s), and any underwriting discounts and selling commissions) incident to the Companys obligations under the Registration Rights Agreement.
The foregoing summary of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the form of
Registration Rights Agreement, which is filed as Exhibit 99.5 to this Schedule 13D.
Item 5. |
Interest in Securities of the Company |
The percentages used in this Schedule 13D are calculated based upon 65,395,159 shares of Common Stock outstanding as of May 2, 2023, plus 13,013,636
shares of Common Stock issued in the Merger. The Reporting Persons securities include (a) 9,460,540 shares of Common Stock, and (b) 7,770,000 shares of Common Stock issuable upon conversion of 7,770 shares of Series A Preferred Stock, the
conversion of which is subject to a beneficial ownership limitation of 19.99% of the outstanding Common Stock. The securities exclude shares of Common Stock issuable upon conversion of shares of Series A Preferred Stock in excess of the beneficial
ownership limitation.
Fairmount Funds Management is the investment manager or adviser to Fund I, Fund II and
Co-Invest, and has voting and dispositive power over shares of Common Stock held on behalf of Fund I, Fund II and Co-Invest. Other than the Merger and the Financing
discussed above, the Reporting Persons have not had any transactions in the Common Stock.