Yumanity Therapeutics Inc. completed the acquisition of Proteostasis Therapeutics, Inc. in a reverse merger transaction.
N. Anthony Coles, Managing Director, Chairman and Co-founder of Yumanity will remain as Chairperson. Sheila Wilson, PTI's Chief Operating Officer will leave PTI effective August 27, 2020. Richard Peters, President, Chief Executive Officer and Director of Yumanity, will become President, Chief Executive Officer and Director of the combined company. Yumanity Chief Executive Officer Richard Peters and Yumanity directors and management team will lead combined company. The Board of Directors of the combined company will include all 7 existing Yumanity directors and 2 of the existing PTI directors to be decided on prior to the closing of the transaction. As per filing dated October 28, 2020 the executive management team of Proteostasis is expected to be composed of Paulash Mohsen as Chief Business Officer Brigitte Robertson as Chief Medical Officer along with N. Anthony Coles and Richard Peters. Following the Merger, the board of directors of Proteostasis will include Patricia L. Allen, Richard A. Heyman, Jeffery W. Kelly, Cecil B. Pickett, Lynne Zydowsky, David Arkowitz, N. Anthony Coles and Richard Peters.
The transaction is subject to regulatory approvals, PTI shareholder's approval approving among others, amendment to the certificate of incorporation of PTI effecting the Proteostasis Reverse Stock Split, approval of Yumanity stockholders, the listing of the consideration shares on the Nasdaq Global Market, the Registration Statement must have become effective, Yumanity must have effected a conversion of all of its outstanding convertible indebtedness into shares of Yumanity common stock, the lock-up agreements executed by certain officers, directors and stockholders of Proteostasis and Yumanity must continue to be in full force and effect, Yumanity Reorganization having been consummated immediately prior to the effective time, the Investor Agreements shall have been terminated and PTI having a minimum of $30 million in net cash at closing, Proteostasis must have delivered to Yumanity executed severance agreements consistent with the employment agreements and written resignations of the officers and directors of Proteostasis that are not continuing as officers and directors of Proteostasis following the merger, Proteostasis must have caused the new Board members of Proteostasis to be elected and others.
On November 6, 2020 parties entered in to first amendment agreement, the amendment amends the Yumanity closing condition in the Merger Agreement regarding the minimum PTI net cash that PTI must have at the closing of the Merger by reducing it from $30 million to $28 million. The transaction has been approved by the Board of Directors of PTI and Yumanity. Proteostasis' special meeting of stockholders will be held on December 16, 2020. As of December 22, 2020, Proteostasis Therapeutics's stockholders approved all the proposals related to the merger. The reverse stock split is expected to become effective on December 22, 2020. Subject to the satisfaction of customary closing conditions, the Merger is expected to close shortly following the effectiveness of the reverse stock split. The transaction is expected to close in fourth quarter of 2020.
William Sorabella of Gibson, Dunn & Crutcher LLP is advising MTS Health Partners, L.P. MTS Health Partners, L.P acted financial advisor for PTI. MTS Securities, LLC acted as fairness opinion provider for PTI. Miguel J. Vega, Marc Recht, Willam Corcoran, Joshua Friedman, Geoffrey Spolyar and Marianne Sarrazin of Cooley LLP acted as legal advisor for PTI. Stuart Cable, Artthur McGivern, Jesse Nevarez and John T. Haggerty of Goodwin Procter LLP acted as legal advisors for Yumanity. Innisfree M&A Inc. acted as proxy solicitor for PTI for a fee of $15,000 plus reasonable expenses. PTI paid a fee of $0.4 million to MTS Securities for rendering the fairness Opinion. Upon the consummation of the merger, PTI will be obligated to pay to MTS Health Partners, L.P. a fee equal to approximately $1.6 million, up to $0.5 million of which may be paid in the form of PTI's common stock.
Yumanity Therapeutics Inc. completed the acquisition of Proteostasis Therapeutics, Inc. (NasdaqGM:PTI) in a reverse merger transaction on December 22, 2020. As a result of the transaction, Proteostasis Therapeutics, Inc. issued an aggregate of 6,024,433 shares of its common stock to Yumanity Therapeutics. Pursuant to the merger, all of Yumanity's outstanding equity was converted into Proteostasis common stock and securities convertible into or exercisable for Proteostasis common stock. Immediately following the completion of the merger, the former stockholders of Yumanity held approximately 70.3% of the outstanding fully-diluted shares of common stock of the combined company. Proteostasis shareholders and option holders retained an ownership interest representing approximately 29.7% of the outstanding fully-diluted shares of common stock of the combined company. The combined company shares will commence trading on the Nasdaq Capital Market on December 23, 2020, under the ticker symbol YMTX. The $33.6 million private investment in public equity transaction closed concurrently with the merger. The combined company will have nine directors including two Proteostasis directors, David Arkowitz and Kim Drapkin, and the existing Yumanity Directors. Yumanity changed its name from Yumanity Therapeutics, Inc. to Yumanity, Inc.