Item 1.01 Entry into Material Definitive Agreement
Merger Agreement
On March 5, 2023, TCR2 Therapeutics Inc., a Delaware corporation ("TCR2"),
entered into an Agreement and Plan of Merger (the "Merger Agreement") with
Adaptimmune Therapeutics plc, a public limited company incorporated in England
and Wales ("Adaptimmune") and CM Merger Sub, Inc., a Delaware corporation and a
wholly-owned subsidiary of Adaptimmune ("Merger Sub"), pursuant to which, upon
the terms and subject to the conditions thereof, Merger Sub will be merged with
and into TCR2 (the "Merger"), with TCR2 surviving the Merger as a wholly-owned
subsidiary of Adaptimmune.
Pursuant to the Merger Agreement, and upon the terms and subject to the
conditions thereof, at the effective time of the Merger (the "Effective Time"),
each issued and outstanding share of TCR2 common stock, par value $0.0001 per
share (the "TCR2 Common Stock") (other than shares of TCR2 Common Stock held by
TCR2 as treasury stock, or shares of TCR2 Common Stock owned by Adaptimmune,
Merger Sub or any direct or indirect wholly-owned subsidiaries of Adaptimmune),
including shares of TCR2Common Stock underlying TCR2 restricted stock units that
vest upon a change of control, will be converted into the right to receive
1.5117 (the "Exchange Ratio") Adaptimmune American Depositary Shares
("Adaptimmune ADSs").
Each option to acquire shares of TCR2Common Stock that is outstanding and
unexercised immediately prior to the Effective Time, whether or not vested, will
be assumed and substituted for an option to purchase a number of Adaptimmune
ordinary shares or Adaptimmune ADSs, as determined by Adaptimmune, based on a
calculation equal to the product of (i) the total number of shares of TCR2
Common Stock subject to such TCR2 option immediately prior to the Effective Time
multiplied by (ii) six times the Exchange Ratio (the "Ordinary Share Exchange
Ratio"). Each award of restricted stock units with respect to shares of TCR2
Common Stock (other than restricted stock units that vest upon a change of
control) will be assumed and substituted for a restricted stock unit-style
option to purchase a number of Adaptimmune ordinary shares or Adaptimmune ADSs,
as determined by Adaptimmune, based on a calculation equal to the product of (i)
the total number of shares of TCR2 Common Stock subject to such TCR2 restricted
stock unit and (ii) the Ordinary Share Exchange Ratio.
The Merger Agreement contains customary representations, warranties and
covenants given by Adaptimmune, TCR2 and Merger Sub. The Merger Agreement also
contains customary pre-closing covenants, including covenants by each of the
parties relating to conduct of their respective business prior to the closing of
the Merger. In addition, the parties have agreed to use their respective
reasonable best efforts to take all actions necessary, proper or advisable to
complete the Merger and the other transactions contemplated by the Merger
Agreement as promptly as practicable, including making any required regulatory
filings with respect to the Merger, except that Adaptimmune is not required to
divest any assets or businesses of TCR2, Adaptimmune or any of their respective
affiliates and subsidiaries.
The Merger Agreement also provides that, from the earlier of the Effective Time
of the Merger and termination of the Merger Agreement, each of Adaptimmune and
TCR2 is subject to certain restrictions on its ability to solicit acquisition
proposals from third parties, to provide information to third parties and to
engage in discussions with third parties regarding acquisition proposals,
subject to customary exceptions. In addition, the board of directors of each of
Adaptimmune and TCR2 are required to recommend that their respective
shareholders or stockholders vote in favor of the Merger, subject to exceptions
for superior proposals and other situations where failure to effect a
recommendation change would be inconsistent with such board's fiduciary duties.
Consummation of the Merger is subject to various conditions, including, among
others, (i) approval of the Merger Agreement and Merger by TCR2's stockholders,
(ii) Adaptimmune's shareholders authorizing Adaptimmune's board of directors (or
a duly authorized committee thereof) to allot all Adaptimmune ordinary shares to
be issued in connection with the Merger (to be represented by Adaptimmune ADSs),
(iii) the absence of any law or order prohibiting consummation of the Merger,
(iv) Adaptimmune's Registration Statement on Form S-4 (to be issued in
connection with the Merger) having been declared effective, (v) the Adaptimmune
ADSs issuable to TCR2 stockholders having been authorized for listing on Nasdaq,
(vi) accuracy of the other party's representations and warranties (subject to
certain materiality standards set forth in the Merger Agreement), (vii)
compliance by the other party in all material respects with such other party's
obligations under the Merger Agreement; (viii) the absence of a material adverse
effect on the other party since March 5, 2023, (ix) satisfaction of certain
regulatory clearances and (x) certain contingent liabilities of TCR2 being less
than $10 million.
Either Adaptimmune or TCR2 may terminate the Merger Agreement under certain
circumstances, including if (i) the Merger is not completed by September 5,
2023, (ii) the other party's board of directors withdraws, modifies or qualifies
its recommendation in favor of the transactions contemplated by the Merger
Agreement or approves or recommends an alternative transaction or (iii)
Adaptimmune's or TCR2's board of directors, as applicable, resolve to enter into
a definitive agreement with respect to a superior proposal prior to obtaining
approval of the Merger from Adaptimmune's shareholders or TCR2's stockholders,
. . .
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On March 5, 2023, TCR2 entered into amendments to the employment agreements (the
"Executive Agreements") with each of, Garry Menzel, Alfonso Quintas Cardama,
Peter Olagunju and Eric Sullivan (the "Executive Amendments"). The Executive
Amendments revise the severance terms provided under the Executive Agreements as
follows: (i) in connection with a termination of employment by TCR2 without
Cause or by the named executive officer for Good Reason outside the Change in
Control Period (each as defined in the Executive Agreements), the executive is
additionally entitled to the executive's target annual cash bonus, prorated for
the number of days elapsed in the year of termination and (ii) in connection
with a termination of employment by TCR2 without Cause or by the named executive
officer for Good Reason within the Change in Control Period, the executive is
additionally entitled to the executive's full target annual cash bonus for the
year of termination. In addition, the Executive Amendments provide that the
payment of severance upon a termination of employment by TCR2 without Cause or
by the named executive officer for Good Reason within the Change in Control
Period (other than with respect to Dr. Menzel) will be made in a lump sum.
Finally, the Executive Amendments provide that the payment of severance in all
instances will not cease upon the named executive officer's commencement of new
employment.
The foregoing description of the Executive Amendments is not complete and is
qualified in its entirety by reference to the form of Executive Amendment, which
is filed as Exhibit 10.3 hereto, and is incorporated herein by reference.
On March 5, 2023, the Compensation Committee of the Board of Directors of TCR2
approved transaction bonuses for certain of its executive employees (each bonus,
a "Retention Bonus"). The Retention Bonuses will be paid within 30 days
following the closing of the Merger. The payment of each Retention Bonus is
subject to (i) the consummation of the Merger and (ii) the continued employment
of the applicable recipient through the closing of the Merger. Garry Menzel,
Alfonso Quintas Cardama, Peter Olagunju and Eric Sullivan are each eligible to
receive a Retention Bonus in the amount of $171,875, $101,000, $90,000 and
$85,000 respectively.
Item 7.01 Regulation FD Disclosure
On March 6, 2023, Adaptimmune and TCR2issued a joint press release announcing
the execution of the Merger Agreement. The press release is attached as Exhibit
99.1 hereto. On March 6, 2023, representatives of Adaptimmune and TCR2 will
present to investors an investors presentation (the "Investor Presentation") in
connection with the announcement of the Merger Agreement. The Investor
Presentation provides information on both Adaptimmune and TCR2, and an overview
of the strategic rationale for the Merger. TCR2 may also present information
contained in the Investor Presentation to analysts and investors from time to
time. A copy of the Investor Presentation will be available on the Investor
Relations section of TCR2's website at www.tcr2.com and is being furnished as
Exhibit 99.2 hereto. A copy of the script of the Investor Presentation is being
furnished as Exhibit 99.3 hereto.
The information furnished under this Item 7.01, including Exhibits 99.1, 99.2
and 99.3, shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise
subject to the liabilities under that section and shall not be deemed to be
incorporated by reference into any filing under the Securities Act of 1933 or
the Exchange Act, except as expressly set forth by specific reference in such
filing. In addition, Exhibits 99.1, 99.2 and 99.3 contain statements intended as
"forward-looking statements" that are subject to the cautionary statements about
forward-looking statements set forth in such exhibit.
Item 8.01 Other Information
Although the Company has not yet finalized its full financial results for the
fourth quarter and fiscal year ended December 31, 2022, the Company expects to
report that it had approximately $149.2 million of cash, cash equivalents and
investments as of December 31, 2022.
The information contained in this Item 8.01 of this Current Report on Form 8-K
is unaudited and preliminary and does not present all information necessary for
an understanding of TCR2's financial condition as of December 31, 2022. The
audit of TCR2's consolidated financial statements for the year ended December
31, 2022 is ongoing and could result in changes to the information set forth
above.
Item 9.01 Exhibits and Financial Statements
(d) Exhibits.
EXHIBIT
NUMBER DESCRIPTION
2.1* Agreement and Plan of Merger, dated as of March 5, 2023, by and among
TCR2 Therapeutics Inc., Adaptimmune Therapeutics plc and CM Merger Sub,
Inc.
10.1 Form of Voting and Support Agreement, dated as of March 5, 2023, by
and among Adaptimmune, TCR2 and certain stockholders of TCR2.
10.2 Form of Voting and Support Agreement, dated as of March 5, 2023, by
and among Adaptimmune, TCR2 and certain shareholders of Adaptimmune.
10.3 Form of Executive Agreement Amendment.
99.1 Joint Press Release of Adaptimmune and TCR2, dated March 6, 2023.
99.2 Investor Presentation, dated March 6, 2023
99.3 Investor Presentation Script
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
* Exhibits and schedules to this Exhibit have been omitted in accordance with
Item 601(b)(2) of Regulation S-K. The registrant agrees to furnish
supplementally a copy of all omitted exhibits and schedules to the SEC upon
its request.
Forward-looking Statements
This communication relates to the proposed transaction pursuant to the terms of
the Merger Agreement, by and among Adaptimmune, Merger Sub, and TCR2. This
communication includes express or implied forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), about the proposed transaction between TCR2and Adaptimmune and the
operations of the combined company that involve risks and uncertainties relating
to future events and the future performance of Adaptimmune and TCR2. Actual
events or results may differ materially from these forward-looking statements.
Words such as "will," "could," "would," "should," "expect," "plan,"
"anticipate," "intend," "believe," "estimate," "predict," "project,"
"potential," "continue," "future," "opportunity" "will likely result," "target,"
variations of such words, and similar expressions or negatives of these words
are intended to identify such forward-looking statements, although not
all forward-looking statements contain these identifying words. Examples of
such forward-looking statements include, but are not limited to, express or
implied statements regarding: the business combination and related matters,
including, but not limited to, satisfaction of closing conditions to the
proposed transaction, prospective performance and opportunities with respect to
Adaptimmune or TCR2, post-closing operations and the outlook for the companies'
businesses; Adaptimmune's, TCR2's or the combined company's targets, plans,
objectives or goals for future operations, including those related to
Adaptimmune's and TCR2's product candidates, research and development, product
candidate introductions and product candidate approvals as well as cooperation
in relation thereto; projections of or targets for revenues, costs, income (or
loss), earnings per share, capital expenditures, dividends, capital structure,
net financials and other financial measures; future economic performance, future
actions and outcome of contingencies such as legal proceedings; and the
assumptions underlying or relating to such statements.
These statements are based on Adaptimmune's and TCR2's current plans, estimates
and projections. By their very nature, forward-looking statements involve
inherent risks and uncertainties, both general and specific. A number of
important factors, including those described in this communication, could cause
actual results to differ materially from those contemplated in
any forward-looking statements. Factors that may affect future results and may
cause these forward-looking statements to be inaccurate include, without
limitation: uncertainties as to the timing for completion of the proposed
transaction; uncertainties as to TCR2's and/or Adaptimmune's ability to obtain
the approval of Adaptimmune's shareholders or TCR2's stockholders required to
consummate the proposed transaction? the possibility that competing offers will
be made by third parties? the occurrence of events that may give rise to a right
of one or both of Adaptimmune and TCR2 to terminate the merger agreement; the
possibility that various closing conditions for the proposed transaction may not
be satisfied or waived on a timely basis or at all, including the possibility
that a governmental entity may prohibit, delay, or refuse to grant approval, if
required, for the consummation of the proposed transaction (or only grant
approval subject to adverse conditions or limitations); the difficulty of
predicting the timing or outcome of consents or regulatory approvals or actions,
if any; the possibility that the proposed transaction may not be completed in
the time frame expected by Adaptimmune and TCR2, or at all; the risk that
Adaptimmune and TCR2may not realize the anticipated benefits of the proposed
transaction in the time frame expected, or at all; the effects of the proposed
transaction on relationships with Adaptimmune's or TCR2's employees, business or
collaboration partners or governmental entities; the ability to retain and hire
key personnel; potential adverse reactions or changes to business relationships
resulting from the announcement or completion of the proposed transaction;
significant or unexpected costs, charges or expenses resulting from the proposed
transaction; the potential impact of unforeseen liabilities, future capital
expenditures, revenues, costs, expenses, earnings, synergies, economic
performance, indebtedness, financial condition and losses on the future
prospects, business and management strategies for the management, expansion and
growth of the combined business after the consummation of the proposed
transaction; potential negative effects related to this announcement or the
consummation of the proposed transaction on the market price of Adaptimmune's
American Depositary Shares or TCR2's common stock and/or Adaptimmune's or TCR2's
operating or financial results; uncertainties as to the long-term value of
Adaptimmune's American Depositary Shares (and the ordinary shares represented
thereby), including the dilution caused by Adaptimmune's issuance of additional
American Depositary Shares (and the ordinary shares represented thereby) in
connection with the proposed transaction; unknown liabilities related to
Adaptimmune or TCR2; the nature, cost and outcome of any litigation and other
legal proceedings involving Adaptimmune, TCR2 or their respective directors,
including any legal proceedings related to the proposed transaction; risks
related to global as well as local political and economic conditions, including
interest rate and currency exchange rate fluctuations; potential delays or
failures related to research and/or development of Adaptimmune's or TCR2's
programs or product candidates; risks related to any loss of Adaptimmune's or
TCR2's patents or other intellectual property rights; any interruptions of the
supply chain for raw materials or manufacturing for Adaptimmune or TCR2's
product candidates, the nature, timing, cost and possible success and
therapeutic applications of product candidates being developed by Adaptimmune,
TCR2 and/or their respective collaborators or licensees; the extent to which the
results from the research and development programs conducted by Adaptimmune,
TCR2, and/or their respective collaborators or licensees may be replicated in
other studies and/or lead to advancement of product candidates to clinical
trials, therapeutic applications, or regulatory approval; uncertainty of the
utilization, market acceptance, and commercial success of Adaptimmune or TCR2's
product candidates, and the impact of studies (whether conducted by Adaptimmune,
TCR2 or others and whether mandated or voluntary) on any of the foregoing;
unexpected breaches or terminations with respect to Adaptimmune's or TCR2's
material contracts or arrangements; risks related to competition for
Adaptimmune's or TCR2's product candidates; Adaptimmune's or TCR2's ability to
successfully develop or commercialize Adaptimmune's or TCR2's product
candidates; Adaptimmune's, TCR2's, and their collaborators' abilities to
continue to conduct current and future developmental, preclinical and clinical
programs; potential exposure to legal proceedings and investigations; risks
related to changes in governmental laws and related interpretation thereof,
including on reimbursement, intellectual property protection and regulatory
controls on testing, approval, manufacturing, development or commercialization
of any of Adaptimmune's or TCR2's product candidates; unexpected increase in
costs and expenses with respect to the potential transaction or Adaptimmune's or
TCR2's business or operations; and risks and uncertainties related to epidemics,
pandemics or other public health crises and their impact on Adaptimmune's and
TCR2's respective businesses, operations, supply chain, patient enrollment and
retention, preclinical and clinical trials, strategy, goals and anticipated
milestones. While the foregoing list of factors presented here is considered
representative, no list should be considered to be a complete statement of all
potential risks and uncertainties. There can be no assurance that the proposed
transaction or any other transaction described above will in fact be consummated
in the manner described or at all. A more complete description of these and
other material risks can be found in Adaptimmune's and TCR2's respective filings
with the U.S. Securities and Exchange Commission (the "SEC"), including each of
their Annual Reports on Form 10-K for the year ended December 31, 2021,
subsequent Quarterly Reports on Form 10-Q and other documents that may be filed
from time to time with the SEC, as well as, the Registration Statement on Form
S-4 which includes the joint proxy statement of Adaptimmune and TCR2 that also
constitutes the prospectus of Adaptimmune, which joint proxy
statement/prospectus will be mailed or otherwise disseminated to Adaptimmune's
shareholders and TCR2's stockholders when it becomes available. Adaptimmune and
TCR2 also plan to file other relevant documents with the SEC regarding the
proposed transaction.
Any forward-looking statements speak only as of the date of this communication
and are made based on the current beliefs and judgments of Adaptimmune's and
TCR2's management, and the reader is cautioned not to rely on
any forward-looking statements made by Adaptimmune or TCR2. Unless required by
law, neither Adaptimmune nor TCR2 is under no duty and undertakes no obligation
to update or revise any forward-looking statement after the distribution of this
document, including without limitation any financial projection or guidance,
whether as a result of new information, future events or otherwise.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to
subscribe for, buy or sell or the solicitation of an offer to subscribe for, buy
or sell any securities, or a solicitation of any vote or approval, nor shall
there be any sale of, or offer to sell or buy, securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such jurisdiction. This
communication is for informational purposes only. No offering of securities
shall be made, except by means of a prospectus meeting the requirements of
Section 10 of the U.S. Securities Act of 1933, as amended, and otherwise in
accordance with applicable law.
Additional Information and Where to Find It
In connection with the proposed transaction, Adaptimmune and TCR2 expect to file
with the SEC a Registration Statement on Form S-4. The Registration Statement on
Form S-4 will include a document that serves as a prospectus of Adaptimmune and
a joint proxy statement of Adaptimmune and TCR2, and each party may also file
other documents regarding the proposed transaction with the SEC. INVESTORS AND
SECURITY HOLDERS ARE URGED TO READ CAREFULLY THE REGISTRATION STATEMENT ON FORM
S-4, JOINT PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED OR WILL
BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY
DOCUMENTS INCORPORATED BY REFERENCE THEREIN, IN THEIR ENTIRETY IF AND WHEN THEY
BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED TRANSACTION, RELATED MATTERS AND THE PARTIES TO THE PROPOSED
TRANSACTION.
You may obtain a free copy of the Registration Statement on Form S-4, joint
proxy statement/prospectus and other relevant documents (if and when they become
available) that are or will be filed with the SEC for free at the SEC's website
at www.sec.gov. Copies of the documents filed with the SEC by TCR2will be
available free of charge on TCR2's website at https://investors.tcr2.com/ or by
contacting TCR2's Investor Relations Department at
https://investors.tcr2.com/contact-ir. Copies of the documents filed with the
SEC by Adaptimmune will be available free of charge on Adaptimmune's website at
https://www.adaptimmune.com/investors-and-media/sec-filings or by contacting
Adaptimmune's Investor Relations Department at ir@adaptimmune.com.
Participants in the Solicitation
Adaptimmune, TCR2 and certain of their respective directors and executive
officers and other members of management and employees may be deemed to be
participants in the solicitation of proxies in respect of the proposed
transaction. Information about the directors and executive officers of
Adaptimmune, including a description of their direct or indirect interests, by
security holdings or otherwise, is set forth in Adaptimmune's proxy statement
for its 2022 Annual General Meeting, which was filed with the SEC on April 21,
2022, the Annual Report on Form 10-K for the year ended December 31, 2021 filed
with the SEC on March 14, 2022, subsequent Quarterly Reports on Form 10-Q and
other documents that may be filed from time to time with the SEC. Information
about the directors and executive officers of TCR2, including a description of
their direct or indirect interests, by security holdings or otherwise, is set
forth in TCR2's proxy statement for its 2022 Annual Meeting of Stockholders,
which was filed with the SEC on September 1, 2022, the Annual Report on Form
10-K for the year ended December 31, 2021 filed with the SEC on March 22, 2022,
subsequent Quarterly Reports on Form 10-Q and other documents that may be filed
from time to time with the SEC. Other information regarding the participants in
the proxy solicitations and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in the joint
proxy statement/prospectus included in the Registration Statement on Form S-4
and other relevant materials to be filed with the SEC regarding the proposed
transaction when such materials become available. Security holders, potential
investors and other readers should read the joint proxy statement/prospectus,
included in the Registration Statement on Form S-4 carefully when it becomes
available before making any voting or investment decision. You may obtain free
copies of these documents from Adaptimmune or TCR2 using the sources indicated
above.
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