Item
1.01. Entry into a Material Definitive Agreement.
On
October 4, 2021, Helix Acquisition Corp., a Cayman Islands exempted company (“Helix”) announced that
it entered into a Business Combination Agreement (the “Business Combination Agreement”), by and among Helix,
MoonLake Immunotherapeutics AG, a Swiss stock corporation (Aktiengesellschaft) registered with the commercial register of the
Canton of Zug, Switzerland under the number CHE-433.093.536 (“MoonLake”), the existing equityholders of MoonLake
set forth on the signature pages to the Business Combination Agreement (collectively, the “ML Parties”), Helix
Holdings LLC, a Cayman Islands limited liability company and the sponsor of Helix (the “Sponsor”), and the
representative of the ML Parties.
This
Current Report on Form 8-K (this “Current Report”) provides a summary of the Business Combination Agreement
and the other agreements entered into and contemplated in connection with the Business Combination (as defined below). The descriptions
of these agreements do not purport to be complete and are qualified in their entirety by the terms and conditions of such agreements,
copies of which are attached here as Exhibits 2.1, 10.1, 10.2, 10.3, 10.4, and 10.5 hereto.
Business
Combination Agreement
Following
completion (the “Closing” and the date of Closing, the “Closing Date”) of the
business combination contemplated by the Business Combination Agreement (the “Business Combination”), the
existing equityholders of MoonLake will retain their equity interests in MoonLake (except as noted below with respect to the BVF
Shareholders) and will receive a number of non-economic voting shares in Helix determined by multiplying the number of MoonLake
Common Shares (as defined below) held by them immediately prior to the Closing by the Exchange Ratio; and Helix will receive a
controlling equity interest in MoonLake in exchange for making the Cash Contribution (as defined below). The Exchange Ratio is the
quotient obtained by dividing (a) 360,000,000 by (b) the fully diluted shares of Moonlake prior to the Closing by (c) 10.
Substantially all of the assets and business of MoonLake and Helix will be held by MoonLake as the operating company following the
Closing. At the Closing, Helix will change its name to “MoonLake Immunotherapeutics.”
The
Business Combination has been approved by the boards of directors of each of Helix and MoonLake. The Closing is expected to occur late
in the fourth quarter of 2021 or early in the first quarter of 2022, following the receipt of the required approval by MoonLake’s
and Helix’s shareholders and the satisfaction of certain other customary closing conditions.
Business
Combination Structure
Assuming
approval of the Business Combination by Helix’s shareholders and the satisfaction or waiver of the other closing conditions set
forth in the Business Combination Agreement, the following transactions will occur:
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(i)
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At
the Closing, all then-outstanding Class B ordinary shares of Helix, par value $0.0001 per
share (the “Helix Class B Ordinary Shares”), will be automatically
converted into Class A ordinary shares of Helix, par value $0.0001 per share (the “Helix
Class A Ordinary Shares”), on a one-for-one basis.
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(ii)
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At
the Closing, Helix will amend and restate its existing memorandum and articles of association
(as amended and restated, the “A&R Memorandum and Articles”)
to, among other things, establish a share structure containing the Helix Class A Ordinary
Shares, which will carry economic and voting rights, and Class C ordinary shares of Helix,
par value $0.0001 per share (the “Helix Class C Ordinary Shares”),
which will carry voting rights but no economic rights.
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(iii)
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One
business day prior to the Closing Date, subject to approval by MoonLake’s shareholders
and registration by the competent Swiss commercial register, the ML Parties and MoonLake
will effectuate a restructuring of the share capital of MoonLake (the “Restructuring”),
to, among other things, (x) convert the existing Series A preferred shares of MoonLake, par
value of CHF 0.10 per share (the “MoonLake Series A Preferred Shares”)
into an equal number of common shares of MoonLake with a par value CHF 0.10 per share (the
“MoonLake Common Shares”), such that the ML Parties will hold a
single class of capital stock of MoonLake immediately prior to the Closing and (y) approve
a capital increase for the issuance of Class V Voting Shares of MoonLake, par value CHF 0.01
per share, each Class V Voting Share due to its lower par value having ten times the voting
power of a MoonLake Common Share (the “MoonLake Class V Voting Shares”).
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(iv)
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At
least four business days prior to the Closing Date, Helix and MoonLake will determine as
of such date (x) the cash in Helix’s trust account established in connection with Helix’s
initial public offering (the “Trust Account”), less amounts
required to satisfy any redemptions and less the aggregate amount of any unpaid Helix
transaction expenses plus the aggregate proceeds actually received by Helix from any
consummated PIPE (as defined below) as of such date (collectively, the “Preliminary
Investment Amount”), and (y) the number of MoonLake Class V Voting Shares to
be issued by MoonLake to Helix at the Closing, which will be equal to (A) the Preliminary
Investment Amount divided by (B) the Exchange Ratio (such number of shares, the “Preliminary
Class V Voting Shares”).
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(v)
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At
least three business days prior to the Closing Date, Helix will transfer an amount equal
to the product of the Preliminary Class V Voting Shares multiplied by CHF 0.01 (the
nominal amount of each MoonLake Class V Voting Share) to a blocked Swiss bank account of
the Company.
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(vi)
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On
the Closing Date, Helix and MoonLake will determine (x) the aggregate cash available to the
combined company following the Closing, based on the amount of cash in the Trust Account
less amounts actually required to satisfy any payments made in satisfaction of redemptions
by Helix’s public shareholders and the payment of certain permitted transaction expenses
of Helix plus the aggregate proceeds actually received from the PIPE (collectively,
the “Available Closing Date Cash”), (y) the final number of MoonLake
Class V Voting Shares attributable to Helix at the Closing based on the Available Closing
Date Cash, and (z) the Available Closing Date Cash less the product of the Preliminary
Class V Voting Shares and CHF 0.01 (the “Cash Contribution”).
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(vii)
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On
the Closing Date, Helix will pay all unpaid transaction expenses and then pay the Cash
Contribution to MoonLake.
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(viii)
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If
the Available Closing Date Cash is lower than the Preliminary Investment Amount, at the election
of MoonLake, Helix will retransfer to MoonLake the number of MoonLake Class V Voting Shares
at par value that have been issued in excess.
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(ix)
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On
the Closing Date, following the Restructuring, certain of the ML Parties (the “BVF
Shareholders”) will assign all of their MoonLake Common Shares to Helix and
Helix will issue to the BVF Shareholders an aggregate amount of Helix Class A Ordinary
Shares equal to the product of such
number of assigned MoonLake Common Shares and the Exchange Ratio.
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(x)
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On
the Closing Date, Helix will issue the Helix Class C Ordinary Shares to the ML Parties (other
than the BVF Shareholders).
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Business Combination Consideration
The ML Parties (other than
the BVF Shareholders) will be issued, for nominal consideration, Helix Class C Ordinary Shares, with each ML Party (other than the BVF
Shareholders) receiving such number of Helix Class C Ordinary Shares for each MoonLake Common Share it owns following the Restructuring
equal to the Exchange Ratio. Beginning six months after the Closing Date, each ML Party (other than the BVF Shareholders) will have the
option to exchange its MoonLake Common Shares together with its Helix Class C Ordinary Shares for a number of Helix Class A Ordinary
Shares equal to the product of (i) the number of MoonLake Common Shares then held by (ii) the Exchange Ratio.
Governance
Helix
has agreed to take all action within its power as may be necessary or appropriate such that, effective immediately after the Closing,
the Helix board of directors will consist of seven directors, which will initially include: Jorge Santos da Silva, two persons designated
by Helix, and four persons designated by MoonLake. The board of directors of Helix is expected to have a majority of independent directors
for the purposes of Nasdaq Capital Market (“Nasdaq”) rules, each of whom will serve in such capacity in accordance
with the terms of Helix’s A&R Memorandum and Articles following the Closing.
Representations
and Warranties; Covenants
The
Business Combination Agreement contains customary representations and warranties of MoonLake and its subsidiaries, the ML Parties, and
Helix.
The
Business Combination Agreement includes customary covenants of the parties with respect to the operation of their respective businesses
prior to the consummation of the Business Combination and efforts to satisfy the conditions to consummation of the Business Combination.
The
Business Combination Agreement also contains additional covenants of the parties, including, among others, covenants providing for Helix
and MoonLake to use their commercially reasonable efforts to obtain all necessary regulatory approvals, covenants of Helix to use reasonable
best efforts to consummate the PIPE (as defined below) and of MoonLake to use commercially reasonable efforts to cooperate in the arrangement
of the PIPE, and covenants providing for Helix and MoonLake to cooperate in the preparation of the proxy statement for the solicitation
of approval of the Business Combination from Helix’s shareholders (the “Proxy Statement”).
Non-Solicitation
Restrictions
Except
as expressly permitted by the Business Combination Agreement from the date of the Business Combination Agreement to the Closing or,
if earlier, the valid termination of the Business Combination Agreement in accordance with its terms, the ML Parties have agreed not
to, directly or indirectly: (i) solicit, initiate, enter into or continue discussions, negotiations or transactions with, or
encourage or respond to any inquiries or proposals by, or provide any information to, any person (other than Helix, the Sponsor, and
its or their agents, representatives, and advisors) concerning any merger, sale of ownership interests and/or assets of the
MoonLake, recapitalization or similar transaction which would result in MoonLake becoming a public company or which would impede,
interfere with, or prevent the Business Combination, or any liquidation or dissolution of MoonLake (each, a “MoonLake
Competing Transaction”); (ii) enter into, participate in, continue or otherwise engage in any discussions or
negotiations regarding, or cooperate in any way that would otherwise reasonably be expected to lead to a MoonLake Competing
Transaction; (iii) furnish (including through any virtual data room) any information relating to MoonLake or any of its assets,
businesses, properties, books or records or afford access to the assets, business, properties, books or records of MoonLake to any
person (other than Helix, the Sponsor, and its or their agents, representatives, and advisors) for the purpose of assisting with or
facilitating, or that could otherwise reasonably be expected to lead to, a MoonLake Competing Transaction; (iv) approve, endorse or
recommend any MoonLake Competing Transaction; or (v) enter into a MoonLake Competing Transaction or any agreement, arrangement or
understanding (including any letter of intent or term sheet) relating to a MoonLake Competing Transaction or publicly announce an
intention to do so.
Except
as expressly permitted by the Business Combination Agreement from the date of the Business Combination Agreement to the Closing or, if
earlier, the valid termination of the Business Combination Agreement in accordance with its terms, Helix and the Sponsor shall not, directly
or indirectly: (i) solicit, initiate or take any action to facilitate or encourage any inquiries or the making, submission or announcement
of, any proposal or offer from any person (other than MoonLake, the ML Parties, and their respective representatives) (an “Alternative
Target”) that may constitute or could reasonably be expected to lead to, an merger or consolidation with, or acquisition
of, purchase of all or substantially all of the assets or equity of, or similar business combination with or involving Helix and a third
party, (ii) enter into, participate in, continue or otherwise engage in, any discussions or negotiations with any Alternative Target
regarding a merger, consolidation, acquisition, purchase of all or substantially all of the assets or equity of, or similar business
combination with such Alternative Target (a “Helix Competing Transaction”); (iii) furnish (including through
any virtual data room) any non-public information relating to Helix or any of its assets or businesses, or afford access to the assets,
business, properties, books or records of Helix to an Alternative Target, in all cases for the purpose of assisting with or facilitating,
or that could otherwise reasonably be expected to lead to, a Helix Competing Transaction; (iv) approve, endorse or recommend any Helix
Competing Transaction; or (v) enter into a Helix Competing Transaction or any agreement, arrangement or understanding (including any
letter of intent or term sheet) relating to a Helix Competing Transaction or publicly announce an intention to do so.
Helix
Change in Recommendation
Helix
is required to include in the Proxy Statement the recommendation of Helix’s board of directors to Helix’s shareholders that
they approve the transaction proposals (as such proposals are more fully set forth in the Business Combination Agreement, collectively,
the “Helix Board Recommendation”). Helix is permitted to change the Helix Board Recommendation only as required
by applicable legal requirements.
Conditions
to Closing
General
Conditions
The
consummation of the Business Combination is conditioned upon, among other things, (a) receipt of Helix’s shareholder approval,
(b) Helix having not redeemed Helix Class A Ordinary Shares in an amount that would cause Helix to have net tangible assets of less
than $5,000,001, and (c) certain conditions precedent set forth in the Investment Agreement (summarized below) shall have been
satisfied or waived and the closing actions and deliverables set forth therein shall have been taken.
MoonLake’s
and Helix’s Additional Conditions to Closing
The
obligations of MoonLake and the ML Parties to consummate the Business Combination are conditioned upon customary closing conditions,
including, without limitation, (a) the accuracy of the representations and warranties of Helix made in the Business Combination Agreement
and Investment Agreement, subject to certain bring-down standards, (b) performance of the covenants of Helix required by the Business
Combination Agreement to be performed at or prior to the Closing, and (c) the Available Closing Date Cash equaling or exceeding $150,000,000.
The
obligations of Helix to consummate the Business Combination are also conditioned upon customary closing conditions, including, without
limitation, (a) the accuracy of the representations and warranties of MoonLake and the ML Parties made in the Business Combination Agreement
and Investment Agreement, subject to certain bring-down standards, (b) performance of the covenants of MoonLake and the ML Parties required
by the Business Combination Agreement to be performed at or prior to the Closing, (c) no material adverse effect having occurred and
(d) the Available Closing Date Cash equaling or exceeding $52,000,000, the minimum amount required for Helix to obtain voting control
of MoonLake.
Termination
The
Business Combination Agreement allows the parties to terminate the Business Combination Agreement if certain customary conditions described
in the Business Combination Agreement are not satisfied, including, without limitation, each party’s right to terminate, subject
to certain limited exceptions, if the Business Combination is not consummated by May 30, 2022 (the “Outside Date”).
If
the Business Combination Agreement is validly terminated, none of the parties to the Business Combination Agreement will have any liability
or any further obligation under the Business Combination Agreement other than customary confidentiality obligations, except in the case
of a willful and material breach of the Business Combination Agreement or fraud in the making of the representations and
warranties in the Business Combination Agreement.
A
copy of the Business Combination Agreement is filed with this Current Report as Exhibit 2.1 and is incorporated herein by reference,
and the foregoing description of the Business Combination Agreement is qualified in its entirety by reference thereto. The Business Combination
Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date of the Business
Combination Agreement or other specific dates. The assertions embodied in those representations, warranties and covenants were made for
purposes of the contract among the respective parties and are subject to important qualifications and limitations agreed to by the parties
in connection with negotiating such agreement.
Certain
Related Agreements
Investment
Agreement
On
October 4, 2021, concurrently with the execution of the Business Combination Agreement, Helix, MoonLake and each of the ML Parties entered
into an Investment Agreement (the “Investment Agreement”). Pursuant to the terms of the Investment Agreement,
one business day prior to the Closing Date, the existing
shareholders of MoonLake will hold an extraordinary shareholders meeting to (i) approve the conversion of MoonLake Series A Preferred
Shares into MoonLake Common Shares, (ii) approve the increase of the nominal statutory capital of MoonLake through the issuance of the
MoonLake Class V Voting Shares to Helix, (iii) waive such existing MoonLake shareholders’ subscription right with respect to the
nominal capital increase and the issuance of the MoonLake Class V Voting Shares to Helix, (iv) approve the amendment of MoonLake’s
articles of association to reflect such conversion and capital increase, and (v) elect one director nominated by Helix and one director
nominated by the ML Parties ((i) to (v) together, the “MoonLake EGM Resolutions”).
The
Investment Agreement includes customary covenants of MoonLake and the existing shareholders of MoonLake with respect to the operation
of the business of MoonLake prior to the consummation of the Investment Agreement and efforts to satisfy the conditions precedent to
the consummation of the Investment Agreement.
The
closing of the Investment Agreement is conditioned upon, among other things, (a) in favor of Helix, customary corporate conditions as
to the existing share capital of MoonLake, (b) the delivery of copies of duly executed corporate documents evidencing the passing of
the MoonLake EGM Resolutions, and (c) the satisfaction or waiver of all conditions precedent under the Business Combination Agreement,
save for the condition that all conditions precedent of the Investment Agreement be satisfied. If the Business Combination Agreement
is terminated before closing of the Investment Agreement, the Investment Agreement will be immediately terminated and all acts, documents,
instruments, or deeds executed by the parties to the Investment Agreement will be deemed terminated and rescinded and without further
effect.
The
foregoing description of the Investment Agreement is subject to and qualified in its entirety by reference to the full text of the Investment
Agreement, a copy of which is attached as Exhibit 10.1 hereto, and the terms of which are incorporated herein by reference.
A&R
Shareholders’ Agreement
At
the Closing, Helix, MoonLake and each ML Party will enter into an amended and restated shareholders’ agreement (the “A&R
Shareholders’ Agreement”), pursuant to which MoonLake’s existing shareholders’ agreement will be amended
and restated. The A&R Shareholders’ Agreement will become effective as of the registration of the increase of MoonLake’s
nominal share capital in the commercial register of the Canton of Zug, Switzerland and will continue in force until the earlier of 15
years or the date on which all of the ML Parties have exchanged their equity in MoonLake for Helix Class A Ordinary Shares.
With
the intent to approximate the rights, obligations and restrictions that an ML Party would enjoy if it were a holder of Helix Class A
Ordinary Shares, the A&R Shareholders’ Agreement (i) imposes certain transfer and other restrictions on the ML Parties,
(ii) provides for the waiver of certain statutory rights and (iii) establishes certain mechanics whereby Helix and each of the ML
Parties are able to effect the conversion of MoonLake Common Shares and Helix Class C Ordinary Shares for a number of Helix Class A
Ordinary Shares equal to the Exchange Ratio.
The
foregoing description of the A&R Shareholders’ Agreement is subject to and qualified in its entirety by reference to the full
text of the form of A&R Shareholders’ Agreement, a copy of which is attached as Exhibit 10.2 hereto, and the terms of which
are incorporated herein by reference.
Subscription
Agreements and PIPE Investment (Private Placement)
On
October 4, 2021, concurrently with the execution of the Business Combination Agreement, Helix entered into subscription agreements
(collectively, the “Subscription Agreements”) with certain investors (collectively, the “PIPE
Investors” which include an affiliate of the Sponsor and certain existing equityholders of MoonLake) pursuant to, and
on the terms and subject to the conditions of which, the PIPE Investors have collectively subscribed for 11,500,000 Helix Class A
Ordinary Shares at a price of $10.00 per share, for an aggregate purchase price of $115,000,000 (the
“PIPE”).
The
PIPE is expected to be consummated immediately prior to or substantially concurrently with the Closing of the Business Combination. The
closing of the PIPE is conditioned upon, among other things, (i) the satisfaction or waiver of
all conditions precedent to the Business Combination and the substantially concurrent consummation of the Business Combination, (ii) the
accuracy of all representations and warranties of Helix and the PIPE Investors in the Subscription Agreements, subject to certain bring-down
standards, and (iii) the satisfaction of all covenants, agreements, and conditions required to be performed by Helix and the PIPE Investors
pursuant to the Subscription Agreements. The Subscription Agreements provide for certain customary registration rights for the
PIPE Investors.
The
Subscription Agreements will terminate with no further force and effect upon the earliest to occur of: (a) such date and time as the
Business Combination Agreement or Investment Agreement is terminated in accordance with its terms; (b) the mutual written agreement of
Helix and the PIPE Investor to terminate its Subscription Agreement; (c) if on the Closing Date, any of the conditions to closing
set forth in the Subscription Agreement are not satisfied or waived, and, as a result thereof, the transactions contemplated in the Subscription
Agreement are not consummated at the Closing; or (d) May 30, 2022.
The
foregoing description of the Subscription Agreements and the PIPE is subject to and qualified in its entirety by reference to the full
text of the form of Subscription Agreement, a copy of which is attached as Exhibit 10.3 hereto, and the terms of which are incorporated
herein by reference.
Amended
Sponsor Letter
On
October 4, 2021, Helix, the Sponsor, and the officers and directors of Helix (the “Insiders”) agreed,
at and conditioned upon the closing, to enter into an amendment (the “Amended Sponsor Agreement”) to the letter
agreement among the parties dated October 19, 2020. Pursuant to the Amended Sponsor Agreement, the Sponsor and Insiders will (i) waive
the anti-dilution and conversion price adjustments set forth in Helix’s existing memorandum and articles of association with respect
to the Helix Class B Ordinary Shares held by the Sponsor and Insiders and (ii) vote in favor of approval of the adoption of the Business
Combination Agreement, the Business Combination, and each other proposal presented by Helix for approval by Helix’s stockholders.
The
foregoing description of the Amended Sponsor Agreement is subject to and qualified in its entirety by reference to the full text of the
Amended Sponsor Agreement, a copy of which is attached as Exhibit 10.4 hereto, and the terms of which are incorporated herein by reference.
Amended
and Restated Registration Rights Agreement
At
the Closing of the Business Combination, MoonLake, the Sponsor and certain ML Parties will enter into an amended and restated registration
rights agreement (the “Amended and Restated Registration Rights Agreement”) pursuant to which, among other
things, the parties thereto will be granted certain customary registration rights with respect to Helix Class A Ordinary Shares beneficially
held by them, directly or indirectly.
The
foregoing description of the Amended and Restated Registration Rights Agreement is subject to and qualified in its entirety by reference
to the full text of the form of the Amended and Restated Registration Rights Agreement, a copy of which is attached as Exhibit 10.5 hereto,
and the terms of which are incorporated herein by reference.
Incentive
Equity Plan
Pursuant
to the Business Combination Agreement, Helix is expected to adopt an omnibus incentive equity plan, the form and terms of which
shall be mutually agreed upon by ML Parties and Helix, reserving a number of Helix Class A
Ordinary Shares for grants thereunder equal to 8% of the total number of Helix Class A Ordinary Shares outstanding on a fully
diluted basis at the Closing.