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Item 1.01
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Entry into a Material Definitive Agreement.
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On November 27, 2017, Peregrine Pharmaceuticals, Inc. (the “Company”)
entered into a settlement agreement (the “Agreement”) with Ronin Trading, LLC, Ronin Capital, LLC, SWIM Partners LP,
SW Investment Management LLC, John S. Stafford, III, Stephen White and Roger Farley (collectively, the “Ronin Group”).
The Ronin Group beneficially owned approximately 9.6% of the outstanding shares of common stock of the Company (“Common Stock”)
as of November 27, 2017.
Pursuant to the Agreement, on November 27, 2017, the Board
of Directors of the Company (the “Board”) accepted the resignations of Steven W. King, Carlton M. Johnson, Jr.,
Eric S. Swartz and David H. Pohl from the Board, and the applicable committees thereof, and the Board of Directors of Avid
Bioservices, Inc. and appointed each of Richard B. Hancock, Gregory P. Sargen, Joel McComb (collectively, the “Ronin
Appointees”) and Joseph Carleone, Ph.D. to the Board to fill the resultant vacancies, each to serve until the
Company’s next annual meeting of stockholders or until his earlier death, resignation, disqualification or removal.
Under the Agreement, so long as the Ronin Group has not breached
the Agreement, the Company agreed to nominate the Ronin Appointees, together with Joseph Carleone, Ph.D. and incumbent directors
Roger J. Lias, Ph.D., Mark R. Bamforth and Patrick D. Walsh, for election to the Board at the Company’s 2017 annual meeting
of stockholders (the “2017 Annual Meeting”). Additionally, so long as the Ronin Group has not breached the Agreement,
the Company agreed to nominate such number of Ronin Appointees to the Board at the Company’s 2018 annual meeting of stockholders
(the “2018 Annual Meeting”) as is equal to the then-current number of authorized directors, minus one, divided by two.
Pursuant to the Agreement, the Ronin Group has agreed not to
take the following actions, among others, prior to the date that is thirty (30) calendar days after the date of the 2018 Annual
Meeting (the “Standstill Period”): (1) propose certain extraordinary transactions, (2) solicit proxies, (3) join any
”group” or voting arrangement, (4) call or seek to call a meeting of stockholders; (5) submit nominations for a contested
election, (5) seek to control, change or influence the management, the Board or policies of the Company, (6) seek waivers or amendments
to the Company’s governing documents, (7) initiate or institute certain litigation or other proceedings against the Company
or any of its current or former directors or officers, or (8) encourage or support any other stockholder to take any of the foregoing
actions.
Pursuant to the Agreement, if any of the Ronin Appointees is
unable to serve as a director, resigns as a director or is removed as a director during the Standstill Period, Ronin may recommend
another individual for appointment to the Board who meets certain criteria, including qualifying as “independent” under
the rules of The NASDAQ Stock Market LLC, among others.
Under the Agreement, the Ronin Group has agreed to be present
for quorum purposes at the 2017 Annual Meeting and all subsequent stockholder meetings during the Standstill Period and to vote
all of the Common Stock beneficially owned by it in accordance with the Board’s recommendations with respect to nominees
to the Board or any other matter at each such subsequent stockholder meeting, subject to certain exceptions.
During the Standstill Period, the Company and the Ronin Group
have mutually agreed, subject to certain exceptions, not to make or cause to be made any statement or announcement that disparages,
calls into disrepute, or otherwise defames or slanders the other party or any of its subsidiaries, affiliates, successors, assigns,
officers, directors, board members, products or services.
In addition, the Company and the Ronin Group have agreed that
the Company will reimburse the Ronin Group for its actual, reasonable and documented out-of-pocket expenses up to $75,000 incurred
in connection with the Agreement and all related matters.
The Agreement contains various other representations and warranties,
obligations and provisions applicable to the Company and the Ronin Group.
The foregoing summary of the Agreement does not purport to be
complete and is qualified in its entirety by reference to the full text of the Agreement, which is filed as Exhibit 10.1 to this
Current Report on Form 8-K.