Item 1.01 Entry into a Material Definitive Agreement.
Royalty Financing Letter Agreement
In December 2019, Kodiak Sciences Inc. together with its subsidiary Kodiak
Sciences GmbH (collectively, "Kodiak") entered into a funding agreement (the
"Funding Agreement") with certain assignees of Baker Bros. Advisors, LP
(collectively, "BBA") under which BBA agreed to fund up to $225.0 million in the
aggregate in exchange for the right to 4.5% royalties on Kodiak's potential
future net sales of KSI-301 and certain other products. The royalty was capped
at 4.5 times the total amount funded under the Funding Agreement. BBA funded
$100.0 million at closing in February 2020, with the remaining $125.0 million to
be funded upon receipt of Kodiak's notice that it had satisfied specified
product development criteria and making certain certifications to BBA.
At Kodiak's request, BBA acknowledged and confirmed on July 22, 2021 in a letter
agreement (the "Letter Agreement") that, despite Kodiak being in a position to
satisfy the product development criteria, the second funding amount would not be
paid and the aggregate royalty cap under the Funding Agreement would be reduced
from $1,012.5 million to $450.0 million. The request was made in light of, among
other factors, Kodiak's strong balance sheet due to the $612.0 million capital
raise in November 2020, its clinical trial progress and capital resources. An
independent committee of the Board of Directors of Kodiak ratified the decision
not to draw the second funding payment.
The foregoing description of the Funding Agreement and the Letter Agreement do
not purport to be complete and are qualified in its entirety by reference to the
complete text of the Funding Agreement and the Letter Agreement, copies of which
are filed as Exhibit 10.1 to that certain Current Report on Form 8-K filed with
the Securities and Exchange Commission on December 2, 2019, and Exhibit 10.1 to
this Current Report on Form 8-K, and each of which is incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits.
(d) The following exhibits are being filed herewith:
Exhibit Description
No.
10.1 Letter Agreement, dated July 22, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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