APREA THERAPEUTICS, INC.

(APRE)
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APREA THERAPEUTICS, INC. : Entry into a Material Definitive Agreement, Completion of Acquisition or Disposition of Assets, Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing, Unregistered Sale of Equity Securities, Change in Directors or Principal Officers, Amendments to Articles of Inc. or Bylaws; Change in Fiscal Year, Regulation FD Disclosure, Financial Statements and Exhibits (form 8-K)

05/17/2022 | 06:09am EDT

Item 1.01. Entry into a Material Definitive Agreement.




Agreement and Plan of Merger


On May 16, 2022, Aprea Therapeutics, Inc., a Delaware corporation ("Aprea"), acquired Atrin Pharmaceuticals Inc., a Delaware corporation ("Atrin"), in accordance with the terms of the Agreement and Plan of Merger, dated May 16, 2022 (the "Merger Agreement"), by and among Aprea, ATR Merger Sub I Inc., a Delaware corporation and a wholly owned subsidiary of Aprea ("First Merger Sub"), ATR Merger Sub II LLC, a Delaware limited liability company and wholly owned subsidiary of Aprea ("Second Merger Sub"), and Atrin. Pursuant to the Merger Agreement, First Merger Sub merged with and into Atrin, pursuant to which Atrin was the surviving corporation and became a wholly owned subsidiary of Aprea (the "First Merger"). Immediately following the First Merger, Atrin merged with and into Second Merger Sub, pursuant to which Second Merger Sub was the surviving entity (the "Second Merger", together with the First Merger, the "Merger"). The Merger is intended to constitute an integrated transaction that qualifies as a "reorganization" within the meaning of Section 368(a) of the Internal Revenue Code of 1986 for U.S. federal income tax purposes.

Under the terms of the Merger Agreement, at the closing of the Merger, Aprea issued to the securityholders of Atrin, 1,117,394 shares of the common stock of Aprea, par value $0.001 per share (the "Common Stock") and 2,949,630 shares of Series A Preferred Stock (as described below), each share of which is convertible into 10 shares of Common Stock, subject to certain conditions described below.

Reference is made to the discussion of the Series A Preferred Stock in Item 5.03 of this Current Report on Form 8-K, which is incorporated into this Item 1.01 by reference.

Certain shares of Common Stock outstanding immediately after the Merger are held by stockholders subject to lock-up restrictions, pursuant to which such stockholders have agreed, except in limited circumstances, not to sell or transfer, or engage in swap or similar transactions with respect to, shares of the Common Stock, including, as applicable, shares received in the Merger and issuable upon exercise of certain options, for a period of 180 days following the closing of the Merger.

Pursuant to the Merger Agreement, Aprea will hold its annual stockholders' meeting (the "Stockholders' Meeting") to submit the following matters to its stockholders for their consideration: (i) the approval of the conversion of the Series A Preferred Stock into shares of Common Stock in accordance with Nasdaq Listing Rule 5635(a) (the "Conversion Proposal"), (ii) the approval of the reverse stock split of all outstanding shares of the Common Stock at a reverse stock split ratio to be determined by Aprea, (iii) the ratification of the appointment by the Aprea Board of Directors (the "Board") of additional members to the Board and (iv) the approval of one or more adjournments of the Stockholders' Meeting to solicit additional proxies if there are not sufficient votes cast in favor of the foregoing matters (collectively, the "Meeting Proposals"). In connection with these matters, Aprea intends to file with the Securities and Exchange Commission ("SEC") a proxy statement and other relevant materials.

The Board approved the Merger Agreement and the related transactions, and the consummation of the Merger (the "Closing") was not subject to approval of the Aprea stockholders.

The foregoing description of the Merger and the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the . . .

Item 2.01 Completion of Acquisition or Disposition of Assets

On May 16, 2022, Aprea completed its business combination with Atrin. The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or

           Standard; Transfer of Listing.



On May 16, 2022, Aprea notified Nasdaq that it is not in compliance with the audit committee composition requirement under Nasdaq Listing Rule 5605(c)(2)(A) due to one vacancy on the audit committee. Effective at the Second Effective Time, Michael A. Kelly, formerly an audit committee member, no longer serves on the board of directors. John B. Henneman and Bernd R. Seizinger continue to serve on the audit committee. The Company is evaluating the appropriate composition of its board committees and fully intends to regain compliance with Rule 5605(c)(2)(A) within the applicable cure period.

Item 3.02 Unregistered Sales of Equity Securities.

Pursuant to the Merger Agreement, Aprea issued shares of Common Stock and Series A Preferred Stock. The information contained in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. Such issuances were exempt from registration pursuant to Section 4(a)(2) of the Securities Act and Regulation D promulgated thereunder.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors;

           Appointment of Certain Officers; Compensatory Arrangements of Certain
           Officers.




Resignation of Officers



On May 14, 2022, the Board approved the removal of Greg Korbel from his position as the Chief Business Officer, effective at the time of the filing of the Second Merger Certificate of Merger with the Secretary of State of the State of Delaware (the "Second Effective Time"). After the Second Effective Time Mr. Korbel will serve as Aprea's Chief Operating Officer, as more fully described below.

Effective as of the conclusion of the Stockholders' Meeting, Christian S. Schade will resign as Chief Executive Officer.



Appointment of Officers


On May 14, 2022, the Board approved the following appointments, effective at the Second Effective Time: (i) the appointment of Oren Gilad, Ph.D. to the position of the President of Aprea and (ii) the appointment of Greg Korbel to the position of the Chief Operating Officer of Aprea (such appointments, collectively, the "Second Effective Time Officer Appointments").

Effective as of the conclusion of the Stockholders' Meeting, Dr. Gilad will be appointed to the position of Chief Executive Officer of Aprea, to fill the vacancy created by Christian S. Schade's resignation as Chief Executive Officer of Aprea (such appointment, collectively with the Second Effective Time Officer Appointments, the "Officer Appointments").

Oren Gilad, Ph.D. (Age 54). Oren Gilad, Ph.D., has extensive leadership experience across all phases of drug development. Prior to joining Aprea, from 2011 to 2022, he was the Chief Executive Officer of Atrin. Prior to founding Atrin in 2011, Dr. Gilad had a 13-year academic career, where he authored numerous high impact scientific articles, including one that demonstrated the importance of the ATR pathway in cancer development and prevention. This breakthrough research was conducted at the University of Pennsylvania. Dr. Gilad holds a B.Sc from the Hebrew University, a Ph.D. and post-doctorate from the University of California at Davis, and a post-doctorate from the University of Pennsylvania.

Dr. Gilad has no family relationship with any of the executive officers or directors of Aprea. There are no arrangements or understandings between Dr. Gilad and any other person pursuant to which he was appointed as an officer of Aprea.

Greg Korbel (Age 46). Prior to being appointed as Chief Operating Officer of Aprea, Dr. Korbel served as Aprea's Chief Business Officer since April 2021, having previously served as Vice President, Business Development since July 2016. Dr. Korbel has more than 12 years of experience in the biotechnology and pharmaceutical industries. Prior to joining Aprea, he was the Director of Business Development and Operations at Novira Therapeutics, which was acquired in December 2015 by Johnson & Johnson, and served as the Director of Research Operations subsequent to the acquisition. In addition to consulting for venture capital and biotechnology firms, Dr. Korbel formerly served as Senior Scientist at Invitrogen/Life Technologies. Dr. Korbel received an M.B.A. from the Wharton School at the University of Pennsylvania, a Ph.D. in Chemistry from Harvard University and a B.A. from Vanderbilt University.

Dr. Korbel has no family relationship with any of the executive officers or directors of Aprea. There are no arrangements or understandings between Dr. Korbel and any other person pursuant to which he was appointed as an officer of Aprea.




Resignation of Directors



In accordance with the Merger Agreement, on May 16, 2022, Fouad Namouni and Michael A. Kelly resigned from the Board as Class II and Class III directors, respectively, and any respective committee of the Board to which they were members, effective at the Second Effective Time. The resignations were not the result of any disagreements with Aprea relating to the Aprea's operations, policies or practices. Effective immediately prior to the closing of the Merger, all unexpired, unexercised and unvested options to purchase Aprea's shares held by the members of the Board accelerated in full and remain exercisable subject to the terms and conditions of the applicable option award agreement.



Appointment of Directors


In accordance with the Merger Agreement, the Board increased the number of directors from seven to eight, such that the number of Class I directors on the Board was increased from two to three. On May 16, 2022, effective as of the Second Effective Time, Michael Grissinger and Rif Pamukcu were appointed as Class II directors. Additionally, on May 16, 2022, effective as of the Second Effective Time, Dr. Gilad was appointed as a Class III director and Marc Duey was appointed as a Class I director (Mr. Grissinger's, Dr. Pamukcu's, Dr. Gilad's and Mr. Duey's appointments as directors, collectively the "Director Appointments").

In accordance with the Merger Agreement, at or immediately after the conclusion of the Stockholders' Meeting, the Board will increase the number of directors from eight to nine, with the additional ninth director to be appointed to the Board by the directors then serving on the Board immediately following the Stockholders' Meeting.

Michael Grissinger (Age 68). Michael Grissinger brings decades of experience in business development, strategy, and pharmaceutical licensing leadership roles at global pharmaceutical companies. Since 2018, Mr. Grissinger has served on the board of directors of Akari Therapeutics, Plc (AKTX), a public company that develops treatments for autoinflammatory diseases involving the complement (C5) and leukotriene (LTB4) pathways. Since 2020, Mr. Grissinger has served as chair of the board of directors of Kira Biotech Pty Ltd, a private biotechnology company developing novel immunomodulatory compounds for the treatment of immune system disorders. Since 2018, he has served on the board of directors of Atriva . . .

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal

           Year.



On May 16, 2022, Aprea filed a Certificate of Designation of Preferences, Rights and Limitations of the Series A Non-Voting Convertible Preferred Stock with the Secretary of State of the State of Delaware (the "Certificate of Designation") in connection with the Merger referenced in Item 1.01 above. The Certificate of Designation provides for the issuance of shares of preferred stock, par value $0.001 per share, designated as Series A Non-Voting Convertible Preferred Stock (the "Series A Preferred Stock").

Holders of Series A Preferred Stock are entitled to receive dividends on shares of Series A Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form, and in the same manner, as dividends (other than dividends on shares of the Common Stock payable in the form of Common Stock) actually paid on shares of the Common Stock when, as and if such dividends (other than dividends payable in the form of Common Stock) are paid on shares of the Common Stock.

Except as otherwise required by law, the Series A Preferred Stock will have no voting rights. However, as long as any shares of Series A Preferred Stock are outstanding, Aprea will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series A Preferred Stock: (i) alter or change adversely the powers, preferences or rights given to the Series A Preferred Stock or alter or amend the Certificate of Designation, amend or repeal any provision of, or add any provision to, the Certificate of Incorporation or bylaws of Aprea, or file any articles of amendment, certificate of designations, preferences, limitations and relative rights of any series of Preferred Stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series A Preferred Stock, regardless of whether any of the foregoing actions will be by means of amendment to the Certificate of Incorporation or by merger, consolidation or otherwise, (ii) issue further shares of Series A Preferred Stock or increase or decrease (other than by conversion) the number of authorized shares of Series A Preferred Stock, (iii) prior to the Stockholder Approval (as defined in the Certificate of Designation), consummate either: (A) any fundamental transaction or (B) any merger or consolidation of Aprea with or into another entity or any stock sale to, or other business combination in which the stockholders of Aprea immediately before such transaction do not hold at least a majority of the capital stock of Aprea immediately after such transaction or (iv) enter into any agreement with respect to any of the foregoing.

Following stockholder approval of the Conversion Proposal, each share of Series A Preferred Stock is convertible into shares of Common Stock at any time at the option of the holder thereof, into 10 shares of Common Stock, subject to certain limitations, including that a holder of Series A Preferred Stock is prohibited from converting shares of Series A Preferred Stock into shares of Common Stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than a specified percentage (to be established by the holder between 4.9% and 19.9%) of the total number of shares of Common Stock issued and outstanding immediately after giving effect to such conversion.

The foregoing description of the Series A Preferred Stock does not purport to be complete and is qualified in its entirety by reference to the Certificate of Designation, a copy of which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On May 16, 2022, Aprea made available a presentation to be used with investors discussing the Merger. A copy of the presentation is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

The information in 7.01 of this Current Report on Form 8-K, including the information in the presentation attached as Exhibit 99.1 to this Current Report on Form 8-K, is furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed "filed" for the purposes of Section 18 of the Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Furthermore, the information in Item 7.01 of this Current Report on Form 8-K, including the information in the presentation attached as Exhibit 99.1 to this Current Report on Form 8-K, shall not be deemed to be incorporated by reference in the filings of Aprea under the Securities Act, as amended.

Forward Looking Statements

This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: uses of proceeds; projected cash runways; future product development plans; stockholder approval of the conversion rights of the Series A Preferred Stock; and any future payouts under the CVR. The use of words such as, but not limited to, "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "project," "should," "target," "will," or "would" and similar words expressions are intended to identify forward-looking statements. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, our clinical results and other future conditions. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. No representations or warranties (expressed or implied) are made about the accuracy of any such forward-looking statements. We may not actually achieve the forecasts disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Such forward-looking statements are subject to a number of material risks and uncertainties including but not limited to those set forth under the caption "Risk Factors" in Aprea's most recent Annual Report on Form 10-K filed with the SEC, as well as discussions of potential risks, uncertainties, and other important factors in our subsequent filings with the SEC. Any forward-looking statement speaks only as of the date on which it was made. Neither we, nor our affiliates, advisors or representatives, undertake any obligation to publicly update or revise any forward-looking statement, whether as result of new information, future events or otherwise, except as required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date hereof.

Item 9.01 - Financial Statements and Exhibits.




(d) Exhibits



Exhibit    Description
Number

  2.1        Agreement and Plan of Merger, dated May 16, 2022 by and among Aprea,
           ATR Merger Sub I Inc., ATR Merger Sub II LLC and Atrin(1)

  3.1        Certificate of Designation of Series A Non-Voting Series A Preferred
           Stock

  10.1       Form of Registration Rights Agreement, by and among Aprea and
           certain securityholders

  99.1       Presentation for investor conference call held by Aprea and Atrin on
           May 16, 2022

Exhibit    Cover Page Interactive Data File (embedded within the Inline XBRL
104        document).



(1) Schedules have been omitted from this filing pursuant to Item 601(b)(2) of

Regulation S-K. Aprea agrees to furnish supplementally a copy of any omitted

schedule to the SEC upon its request; provided, however, that Aprea may

request confidential treatment pursuant to Rule 24b-2 of the Exchange Act for

any schedule so furnished.

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Financials (USD)
Sales 2021
Net income 2021
Net Debt 2021
P/E ratio 2021
Yield 2021
Capitalization 18,7 M 18,7 M -
EV / Sales 2021
EV / Sales 2022 -
Nbr of Employees -
Free-Float 90,2%
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Christian S. Schade Chairman & Chief Executive Officer
Oren Gilad President & Director
Scott M. Coiante Chief Financial Officer, Secretary & Senior VP
Eyal C. Attar Chief Medical Officer & Senior Vice President
Lars Abrahmsén Chief Scientific Officer & Senior Vice President
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