SIERRA ONCOLOGY, INC. Item 1.01. Entry into a Material Definitive Agreement.
Merger Agreement
On
The Company's Board of Directors (the "Company Board") unanimously determined that the Merger Agreement and the Merger are in the best interests of the Company and its stockholders, and approved the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, including the Support Agreements (as defined below). The Company Board also unanimously resolved to recommend that the Company's stockholders vote to adopt and approve the Merger Agreement and the Merger.
Treatment of Capital Stock
Under the Merger Agreement, at the effective time of the Merger, each issued and
outstanding share of the Company's common stock (other than shares (1) held by
the Company as treasury stock; (2) owned by GSK, Acquisition Sub or any of their
respective subsidiaries; or (3) held by stockholders who have neither voted in
favor of the adoption of the Merger Agreement nor consented thereto in writing
and properly and validly exercised their statutory rights of appraisal under
Treatment of Equity Awards
At the effective time of the Merger, each of the Company's outstanding and unexercised stock options will accelerate vesting in full and be cancelled and converted into a right to receive an amount in cash, without interest, equal to the product obtained by multiplying (1) the amount of the Per Share Price (less the exercise price per share attributable to such stock option) by (2) the total number of shares of the Company's common stock issuable upon exercise in full of such stock option. To the extent any stock options have performance-based vesting pursuant to a performance period that is still outstanding after the effective time of the Merger, the performance requirement will be deemed to be satisfied to the maximum achievement of performance criteria. Any stock option with an exercise price per share equal to or greater than the Per Share Price will be cancelled without any cash payment being made in respect thereof.
Treatment of Warrants
In connection with the completion of the Merger, the Company's outstanding warrants will be treated in accordance with their respective terms. At the effective time of the Merger, (1) any of the Company's outstanding Series A warrants will be cancelled and represent only the right to receive an amount in cash, without interest, equal to the Black Scholes Value (as defined in the Series A Warrants) and (2) any of the Company's outstanding pre-funded warrants will be deemed exercised in full as a "cashless exercise" (as described in the Pre-Funded Warrants), and the holder thereof will be entitled to receive an amount in cash, without interest, equal to the product obtained by multiplying (1) the amount of the Per Share Price by (2) the number of shares of the Company's common stock deemed to be issuable upon exercise in full of the pre-funded warrant as a "cashless exercise."
Consummation of the Merger is subject to the satisfaction or waiver of customary closing conditions, including: (1) the approval of the Merger Agreement by holders of a majority of the outstanding shares of Company's common stock (the "Requisite Stockholder Approval"); (2) the expiration or termination of the waiting period under the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; and (3) the absence of any order, law or legal restraint preventing or materially impairing the consummation of the Merger.
The Merger Agreement contains customary representations, warranties and
covenants made by each of the Company, GSK and Acquisition Sub, including, among
others, covenants by the Company regarding the conduct of its business prior to
the closing of the Merger. Beginning on the date of the Merger Agreement, the
Company is subject to customary "no-shop" restrictions pursuant to which the
Company is required, among other things, (i) not to solicit, initiate, propose
or induce the making or knowingly encourage any Acquisition Proposals (as
defined in the Merger Agreement) and (ii) subject to certain exceptions, not to
engage in discussions or negotiations regarding, or furnish to any third party
any non-public information with respect to, any Acquisition Proposal. In
addition, the Company has agreed that, subject to certain exceptions, the
Company Board will not withdraw its recommendation that the Company's
stockholders vote to adopt and approve the Merger Agreement. The Company has
also agreed that the Company will file with the
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Either the Company or GSK may terminate the Merger Agreement if, among certain
other circumstances, (i) the Merger has not been consummated on or before
Upon termination of the Merger Agreement under specified circumstances, the
Company will be required to pay GSK a termination fee of
The Merger Agreement also provides that the Company, on one hand, or GSK and Acquisition Sub, on the other hand, may specifically enforce the obligations under the Merger Agreement. The Merger Agreement is not subject to a financing condition.
The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is filed as Exhibit 2.1 and is incorporated into this report by reference.
The Merger Agreement contains representations and warranties by each of GSK, Acquisition Sub and the Company. These representations and warranties were made solely for the benefit of the parties to the Merger Agreement and:
• should not be treated as categorical statements of fact, but rather as a
way of allocating the risk to one of the parties if those statements
prove to be inaccurate;
• may have been qualified in the Merger Agreement by disclosures that were
made to the other party in connection with the negotiation of the Merger
Agreement;
• may apply contractual standards of "materiality" that are different from
"materiality" under applicable securities laws; and
• were made only as of the date of the Merger Agreement or such other date
or dates as may be specified in the Merger Agreement.
Support Agreements
In connection with entering to the Merger Agreement, on
Item 8.01. Other Events.
On
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 2.1 Agreement and Plan of Merger, datedApril 12, 2022 , between GlaxoSmithKline plc,Orikum Acquisition Inc. , andSierra Oncology, Inc. * 10.1 Form of Support Agreement, dated as ofApril 12, 2022 , by and among GlaxoSmithKline plc,Orikum Acquisition Inc. ,Sierra Oncology, Inc , and certain securityholders ofSierra Oncology, Inc. * 99.1 Joint Press Release issued bySierra Oncology, Inc. , datedApril 13, 2022 . 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
* Schedules and exhibits omitted pursuant to Item 601(b)(2) of Regulation S-K.
Sierra will furnish supplementally a copy of any omitted schedule or exhibit to
the
Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any
schedules or exhibits so furnished.
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