Item 1.01. Entry into a Material Definitive Agreement.
Contingent Value Rights Agreement
On
March 14, 2019, OncoMed Pharmaceuticals, Inc. (
OncoMed
or the
Company
) entered into a Contingent Value Rights Agreement (the
CVR Agreement
) with Computershare Inc., as rights agent,
pursuant to which OncoMeds common stockholders of record as of the close of business on April 5, 2019 (the
Record Date
) will receive one contingent value right (each, a CVR) for each outstanding share of
common stock, par value $0.001 per share, of the Company (the
Company Common Stock
) held by such stockholder as of such date. Each CVR will represent the contractual right to receive cash payments from OncoMed upon the actual
receipt by OncoMed or its affiliates of certain contingent cash payments following the exercise by Celgene Corporation or certain affiliates thereof (collectively, Celgene) of the exclusive option (the
Option Exercise
)
granted by the Company to Celgene in relation to the Companys etigilimab product pursuant to the Master Research and Collaboration Agreement by and among Celgene and the Company, dated December 2, 2013 (the
Celgene Collaboration
Agreement
). More specifically, if a specified approval or sales milestone is achieved or if royalties are paid by Celgene to OncoMed or its affiliates in respect of the etigilimab product (in each case, pursuant to a license agreement to
be entered into by the Company and Celgene in accordance with the Celgene Collaboration Agreement upon the Option Exercise (the
TIGIT License Agreement
)), each CVR holder will be entitled to receive an amount in cash equal to such
holders pro rata portion of any cash payments made by Celgene and actually received by OncoMed or its affiliates in respect thereof, net of any tax and reasonable costs and expenses.
The CVR will be distributed as of the close of business on the Record Date. The contingent payments under the CVR Agreement, if they become payable, will
become payable to Computershare, Inc. as rights agent, for subsequent distribution to the holders of the OncoMed CVRs. In the event that the Option Exercise does not occur, or OncoMed or its affiliates do not achieve or do not receive the applicable
milestone or royalty payments under the TIGIT License Agreement, holders of the CVRs will not receive any payment pursuant to the CVR Agreement. There can be no assurance that any of the applicable milestones or royalties under the TIGIT License
Agreement will be achieved or that any holders of CVRs will receive payments with respect thereto.
The right to the contingent payments contemplated by
the CVR Agreement is a contractual right only and will not be transferable, except in the limited circumstances specified in the CVR Agreement. The CVRs will not be evidenced by a certificate or any other instrument and will not be registered with
the Securities and Exchange Commission (
SEC
). The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in OncoMed or any of its affiliates. No interest will accrue on any amounts
payable in respect of the CVRs.
The foregoing summary of the CVR Agreement does not purport to be complete and is qualified in its entirety by reference
to the full text of the CVR Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form
8-K
and is incorporated herein by reference.
Support Agreements
On March 14, 2019, and in
connection with the Agreement and Plan of Merger and Reorganization, dated December 5, 2018, by and among the Company, Mereo BioPharma Group plc, a public limited company incorporated under the laws of England and Wales
(
Mereo
), Mereo US Holdings Inc., a Delaware corporation and a wholly-owned subsidiary of Mereo, and Mereo MergerCo One Inc., a Delaware corporation and an indirect wholly-owned subsidiary of Mereo (the
Merger
Agreement
), Biotechnology Value Fund, L.P., Biotechnology Value Fund II, L.P., MSI BVF SPV, L.L.C. and Biotechnology Value Trading Fund OS LP (collectively, the
BVF Stockholders
), in their respective capacities as
stockholders of the Company, entered into support agreements (collectively, the
BVF Support Agreements
) with the Company, pursuant to which the BVF Stockholders have agreed, among other things, to vote their respective shares of
Company Common Stock in favor of the adoption of the Merger Agreement and against any alternative proposal and against any action or agreement that would reasonably be expected to frustrate the purposes, prevent, delay or otherwise adversely affect
the consummation of, the transactions contemplated by the Merger Agreement.