Item 1.01. Entry into a Material Definitive Agreement
Option Agreement
On February 1, 2018 (the “Effective Date”), Argos Therapeutics,
Inc. (the “Company”) entered into an option agreement (the “Option Agreement”) with Pharmstandard
International, S.A. (“Pharmstandard”) and Actigen Limited (“Actigen”) to evaluate, with an option to
license, certain patent rights and know-how related to a group of fully human PD1 monoclonal antibodies and related
technology held by Actigen (the “Patent Rights”).
Actigen previously granted Pharmstandard an option to exclusively license the Patent
Rights. Under the Option Agreement, Pharmstandard granted to the Company (i) an exclusive license for evaluation purposes only
to make, have made, use and import the PD1 monoclonal antibodies covered by the Patent Rights (but not offer to sell or sell products
and processes covered by or incorporating the Patent Rights) for a period of one year from the Effective Date (the “Option
Period”) and (ii) an option exercisable during the Option Period to obtain an exclusive license (with the right to sublicense)
under the Patent Rights to make, have made, use, offer for sale, sell and import (with a right to grant sublicenses) the PD1 monoclonal
antibodies for all prophylactic, therapeutic and diagnostic uses and for all human diseases and conditions in the United States
and Canada (the “Option”). The parties have agreed that, if the Company exercises the Option during the Option Period,
the parties will negotiate in good faith a license agreement (the “License Agreement”) on the terms and conditions
outlined in the Option Agreement, including payments by the Company to Pharmstandard of (i) an upfront license fee of $3.6 million,
payable upon execution of the License Agreement in common stock of the Company (the “Upfront License Fee”), (ii) various
development and regulatory milestone payments totaling $8.5 million, and (iii) upper single digit percentage royalties on net
sales of any pharmaceutical product or therapeutic regimen incorporating the licensed PD1 monoclonal antibodies
that will apply on a country-by-country basis until the later of the last to expire patent or ten years from the date of first
commercial sale, against which the first $5.0 million of the Company’s development expenditures will be credited as prepaid
royalties.
In consideration for the rights granted under the Option Agreement, Argos will
issue to Pharmstandard, within sixty days of the Effective Date, 169,014 shares of the Company’s common stock, $0.001
par value per shares (the “Initial Shares”), the value of which will be creditable against the Upfront
License Fee. Unless earlier terminated by any party for uncured material breach or by the Company without cause upon thirty
days prior written notice, the Option Agreement will terminate upon the later of the end of the Option Period if the
Company decides not to exercise the Option or sixty days after the Company exercises the Option.
At-the-Market Program
On February 2, 2018, the Company entered into an Amended and
Restated Sales Agreement (the “Amended and Restated Sales Agreement”), with Cowen and Company, LLC as agent
(“Cowen”). The Company and Cowen entered into the Amended and Restated Sales Agreement in order to increase the
maximum aggregate offering price of the shares of the Company’s common stock, which the
Company may issue and sell from time to time under the Amended and Restated Sales Agreement by $15,000,000 (the
“Additional Shares”) from $30,000,000 to up to $45,000,000 (the “ATM Shares”). On February 2, 2018,
the Company filed a prospectus supplement with the Securities and Exchange Commission (the “SEC”) in connection
with the issuance and sale of the Additional Shares (the “2018 Prospectus Supplement”) under its existing
Registration Statement on Form S-3 (File No 333-215480), which became effective on January 24, 2017 (the “2017
Registration Statement”) and which included a base prospectus (the “2017 Base Prospectus”). The Company
previously filed a prospectus with the SEC in connection with the issuance and sale of the $30,000,000 of shares of common
stock issuable under the original sales agreement with Cowen (the “2015 Prospectus”) under its existing
Registration Statement on Form S-3 (File No. 333-204016), which became effective on May 14, 2015 (the “2015
Registration Statement”). The 2017 Registration Statement and the 2015 Registration Statement are collectively referred
to herein as the “Registration Statements” and the 2017 Base Prospectus, 2018 Prospectus Supplement and the 2015
Prospectus are collectively referred to herein as the “Sales Prospectuses.”
Upon delivery of a placement notice by the Company and subject to
the terms and conditions of the Amended and Restated Sales Agreement, Cowen may sell the ATM Shares in accordance with the
terms set forth in the placement notice and any method permitted that is deemed an “at the market offering” as
defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”).
The Company or Cowen may suspend the offering of the ATM Shares
upon proper notice to the other party. Cowen is not required to sell any specific number or dollar amount of securities, but
will act as a sales agent using commercially reasonable efforts consistent with its normal trading and sales practices, and
in accordance with the terms of the Amended and Restated Sales Agreement.
The compensation to Cowen for sales of common stock under the Amended
and Restated Sales Agreement will be equal to 3.0% of the gross sales price. The Company has also agreed to provide Cowen with
indemnification and contribution with respect to certain liabilities, including liabilities under the Securities Act or Securities
Exchange Act of 1934, as amended.
A copy of the Amended and Restated Sales Agreement is attached as Exhibit
1.1 hereto and is incorporated herein by reference. The foregoing description of the material terms of the Amended and Restated
Sales Agreement does not purport to be complete and is qualified in its entirety by reference to such exhibit.
Wilmer Cutler Pickering Hale and Dorr LLP, counsel to the Company,
has issued a legal opinion relating to the Additional Shares. A copy of such legal opinion, including the consent included therein,
is attached as Exhibit 5.1 hereto.
The ATM Shares will be sold pursuant to the
Registration Statements, and offerings of the ATM Shares will be made only by means of the Sales Prospectuses. This Current
Report on Form 8-K shall not constitute an offer to sell or solicitation of an offer to buy these securities, nor shall there
be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities law of such state or jurisdiction.