UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant
☒
Filed by a Party other than the Registrant
☐
Check the appropriate box:
☐ Preliminary
Proxy Statement
☐ Confidential,
for Use of the Commission Only (as permitted by Rule 14a-6(e)
(2))
☒ Definitive
Proxy Statement
☐ Definitive
Additional Materials
☐ Soliciting
Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
SUMMIT THERAPEUTICS INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ No
fee required.
☐ Fee
paid previously with preliminary materials.
☐ Fee
computed on table in exhibit required by Item 25(b) per
Exchange Act Rules 14a6(i)(1) and 0-11
SUMMIT THERAPEUTICS INC.
2882 Sand Hill Road, Suite 106
Menlo Park, California 94025
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD AT 1:00 P.M. EASTERN TIME ON JANUARY 6,
2023
Dear Summit Therapeutics Inc. Stockholders:
Notice is hereby given that Summit Therapeutics Inc. (the
“Company,” “Summit,” “we,” “us” or “our”) will hold a special
meeting of stockholders (the “Special Meeting”) on January 6, 2023
at 1:00 P.M. Eastern Time. The Special Meeting will be conducted
virtually via live webcast. You will be able to vote and submit
your questions during the meeting by visiting
www.virtualshareholdermeeting.com/SMMT2023SM.
Please have your notice or proxy card in hand when you visit the
website. During the Special Meeting, stockholders will be asked to
vote on the following proposals, as more fully described in the
accompanying proxy statement:
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1. To approve an amendment to the Company’s
Restated Certificate of Incorporation to increase the number of
authorized shares of common stock by 650,000,000 (from 350,000,000
to 1,000,000,000), with the final decision of whether to proceed
with the amendment to be determined by our board of directors, in
its discretion, following stockholder approval (if obtained), but
no later than January 6, 2024.
2. To approve an amendment to our Restated
Certificate of Incorporation to effect a reverse stock split of all
of the outstanding shares of our Common Stock at a ratio in the
range of 1-for-5 to 1-for-10, with the final decision of whether to
proceed with the reverse stock split and the exact ratio and timing
of the reverse split to be determined by our board of directors ,
in its discretion, following stockholder approval (if obtained),
but no later than January 6, 2024.
3. To transact any other business as may properly come before the
Special Meeting or any adjournments or postponements
thereof.
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Our Board of Directors has fixed the close of business on December
5, 2022 as the record date for the Special Meeting (the “Record
Date”). Only stockholders of record on December 5, 2022 are
entitled to notice of and to vote at the Special Meeting. It is
important that your shares are represented and voted at the Special
Meeting. For specific voting instructions, please refer to the
information provided in the proxy statement, together with your
proxy card or the voting instructions you received with the proxy
statement.
Your vote must be received by 11:59 p.m. Eastern Time, on January
5, 2023. For specific voting instructions, please refer to the
information provided in the proxy statement, together with your
proxy card or the voting instructions you received with the proxy
statement. This proxy statement is being mailed to stockholders on
or about December 13, 2022.
YOUR VOTE IS IMPORTANT. Whether or not you plan to attend the
virtual Special Meeting, we request that you submit your vote via
the Internet, telephone or mail.
Thank you for your continued support of Summit Therapeutics
Inc.
By Order of the Board of Directors,
/s/
Robert W. Duggan
Robert W. Duggan
Chief Executive Officer and Executive Chairman
Menlo Park, California
December 13, 2022
PROXY STATEMENT
FOR SPECIAL MEETING OF STOCKHOLDERS
SUMMIT THERAPEUTICS INC.
______________________
PROXY STATEMENT
FOR THE SPECIAL MEETING OF STOCKHOLDERS
To Be Held at 1:00 p.m. Eastern Time on January 6,
2023
______________________
GENERAL INFORMATION
We are providing you with this Proxy Statement and the enclosed
form of proxy in connection with the solicitation by our Board of
Directors for use at our 2023 special meeting of stockholders (the
“Special Meeting”). The Special Meeting will be conducted virtually
via live audio webcast by visiting
www.virtualshareholdermeeting.com/SMMT2023SM
on January 6, 2023 at 1:00 p.m. Eastern Time. This Proxy Statement
contains important information regarding our Special Meeting, the
proposals on which you are being asked to vote, information you may
find useful in determining how to vote, and information about
voting procedures. As used herein, “we,” “us,” “our,” “Summit,” or
the “Company” refers to Summit Therapeutics Inc., a Delaware
corporation.
This Proxy Statement and the accompanying proxy card or voting
instruction form will first be made available to our stockholders
on or about December 13, 2022.
The information provided in the “question and answer” format below
is for your convenience only and is merely a summary of the
information contained in this Proxy Statement. You should read this
entire Proxy Statement carefully. Information contained on or that
can be accessed through our website is not intended to be
incorporated by reference into this Proxy Statement and references
to our website address in this Proxy Statement are inactive textual
references only.
QUESTIONS AND ANSWERS
What is a proxy?
A proxy is your legal designation of another person to vote the
stock you own. The person you designate is your “proxy,” and you
give the proxy authority to vote your shares by submitting the
enclosed proxy card, or if available, voting by telephone or the
Internet. We have designated Robert W. Duggan, Makham Zanganeh or
Ankur Dhingra to serve as proxies for the Special
Meeting.
What matters will be voted on at the Special Meeting?
The following matters will be voted on at the Special
Meeting:
•Proposal
1: To approve an amendment to authorize the Board, in its
discretion but prior to the one-year anniversary of the date on
which the increase in the number of authorized shares is approved
by the Company’s stockholders at the Annual Meeting, to amend the
Company’s Restated Certificate of Incorporation to increase the
number of authorized shares of common stock by 650,000,000 (from
350,000,000 to 1,000,000,000), with the final decision of whether
to proceed with the amendment to be determined by our board of
directors, in its discretion, following stockholder approval (if
obtained), but no later than January 6, 2024 (the “Capitalization
Increase”);
•Proposal
2: To approve an amendment to authorize the Board, in its
discretion but prior to the one-year anniversary of the date on
which the reverse stock split is approved by the Company’s
stockholders at the Annual Meeting, to amend our Restated
Certificate of Incorporation to effect a reverse stock split of all
of the outstanding shares of our Common Stock, at a ratio in the
range of 1-for-5 to 1-for-10, with the final decision of whether to
proceed with the reverse stock split and the exact ratio and timing
of the reverse split to be determined by our board of directors, in
its discretion, following stockholder approval (if obtained), but
no later than January 6, 2024 (the “Reverse Stock Split”);
and
•Such
other business as may properly come before the Special Meeting or
any adjournment or postponement of the Special
Meeting.
How does the Board of Directors recommend that I vote?
The Board of Directors recommends that you vote:
•“FOR”
the approval of the authorization of the Board to amend the
Company’s Restated Certificate of Incorporation to increase the
number of authorized shares of common stock by 650,000,000 (from
350,000,000 to 1,000,000,000), as described in Proposal
1.
•“FOR”
the approval of the authorization of the Board to amend the
Company’s Restated Certificate of Incorporation for the Reverse
Stock Split, as described in Proposal 2.
Will the Board be able to adopt both proposals assuming they are
both approved by stockholders?
The Board has submitted for stockholder approval both the
Capitalization Increase, as described in Proposal 1, and the
Reverse Stock Split, as described in Proposal 2. The Board has
submitted both proposals to stockholders to provide the Board with
maximum flexibility to determine which proposal it believes would
be in the best interests of stockholders. In the event of
stockholder approval of both proposals, the Board will have
discretion as to whether to adopt neither, one or both proposals at
any time prior to the one year anniversary of the stockholder
approval date.
Will there be any other items of business on the
agenda?
If any other items of business or other matters are properly
brought before the Special Meeting, your proxy gives discretionary
authority to the persons named on the proxy card with respect to
those items of business or other matters. The persons named on the
proxy card intend to vote the proxy in accordance with their best
judgment. Our Board of Directors does not intend to bring any other
matters to be voted on at the Special Meeting. We are not currently
aware of any other matters that may properly be presented by others
for action at the Special Meeting.
Who is entitled to vote at the Special Meeting?
Holders of our common stock at the close of business on December 5,
2022, which we refer to as the record date, may vote at the Special
Meeting. Each stockholder is entitled to one vote for each share of
our common stock held as of the record date. In deciding all
matters at the Special Meeting, each stockholder will be entitled
to one vote for each share of our common stock held by them on the
record date.
A list of stockholders entitled to vote at the Special Meeting will
be available for inspection at our principal executive offices for
at least ten days prior to the Special Meeting and at the Special
Meeting. A stockholder may examine the list for any legally valid
purpose related to the Special Meeting.
What is the difference between holding shares as a stockholder of
record and as a beneficial owner?
Stockholders of Record.
You are a stockholder of record if at the close of business on the
record date your shares were registered directly in your name with
Computershare Trust Company, N.A., our transfer agent.
As the stockholder of record, you have the right to grant your
voting proxy directly to the individuals listed on the proxy card
or to vote on your own behalf at the Special
Meeting.
Beneficial Owner.
You are a beneficial owner if, at the close of business on the
record date, your shares were held by a brokerage firm, bank or
other nominee and not in your name. Being a beneficial owner means
that, like many of our stockholders, your shares are held in
“street name.” As the beneficial owner, you have the right to
direct your broker, bank or nominee how to vote your shares by
following the voting instructions your broker, bank or other
nominee provides.
However, since a beneficial owner is not the stockholder of record,
you may not vote your shares of our common stock at the Special
Meeting unless you follow your broker’s procedures for obtaining a
legal proxy.
Please see “What
if I do not specify how my shares are to be
voted?”
for more information.
Do I have to do anything in advance if I plan to attend the Special
Meeting?
The Special Meeting will be a virtual audio meeting of
stockholders, which will be conducted via live audio webcast. You
are entitled to participate in the Special Meeting only if you were
a holder of our common stock as of the close of business on
December 5, 2022 or if you hold a valid proxy for the Special
Meeting.
To participate in the Special Meeting, you will need the control
number included on your notice or proxy card. The live audio
webcast will begin promptly at 1:00 p.m. Eastern Time. We encourage
you to access the meeting prior to the start time. Online check-in
will begin at 12:45 p.m. Eastern Time and you should allow ample
time for the check-in procedures.
How do I ask questions during the Special Meeting?
We are committed to ensuring our stockholders have the same rights
and opportunities to participate in the Special Meeting as if it
had been held in a physical location. If you wish to submit a
question during the meeting, you may log into
www.virtualshareholdermeeting.com/SMMT2023SM
and enter your 16-digit control number. Once past the login screen,
click on “Question for Management,” type in your question, and
click “Submit.”
Questions pertinent to meeting matters will be answered during the
meeting, subject to time constraints. Questions regarding personal
matters are not pertinent to meeting matters and therefore will not
be answered.
How can I get help if I have trouble checking in or listening to
the meeting online?
If you encounter any difficulties accessing the virtual meeting
during the check-in or meeting time, please call the technical
support number that will be posted on the log-in page at
www.virtualshareholdermeeting.com/SMMT2023SM.
How do I vote and what are the voting deadlines?
Stockholders of Record.
If you are a stockholder of record, there are several ways for you
to vote your shares:
•By
mail. If you received printed proxy materials, you may submit your
vote by completing, signing and dating each proxy card received and
returning it in the prepaid envelope. Sign your name exactly as it
appears on the proxy card. Your completed, signed and dated proxy
card must be received prior to the Special Meeting.
•By
telephone or via the Internet. You may vote your shares by
telephone or via the Internet by following the instructions
provided in the proxy card. We recommend that you have your proxy
card in hand when voting by telephone or via the Internet. If you
vote by telephone or via the Internet, you do not need to return a
proxy card by mail. Internet and telephone voting are available 24
hours a day. Votes submitted by telephone or via the Internet must
be received by 11:59 p.m. Eastern Time on January 5,
2023.
•Attend
the Special Meeting. You may vote at the Special Meeting by
following the instructions at
www.virtualshareholdermeeting.com/SMMT2023SM.
Please have your notice or proxy card in hand when you visit the
website.
Beneficial Owners.
If you are a beneficial owner of your shares, you will receive
voting instructions from the broker, bank or other nominee holding
your shares. You should follow the voting instructions provided by
your broker, bank or nominee in order to instruct your broker, bank
or other nominee on how to vote your shares. The availability of
telephone and Internet voting will depend on the voting process of
the broker, bank or nominee. Shares held beneficially may be voted
at the Special Meeting only if you obtain a legal proxy from the
broker, bank or nominee giving you the right to vote the
shares.
Whether or not you plan to attend the Special Meeting, we request
that you vote by proxy to ensure your vote is counted. To vote, you
will need the control number. The control number will be included
in the notice or on
your proxy card if you are a stockholder of record, or included
with your voting instructions received from your broker, bank or
other nominee if you hold your shares of common stock in a “street
name”.
Internet proxy voting is provided to allow you to vote your shares
online, with procedures designed to ensure the authenticity and
correctness of your proxy vote instructions. Please be aware that
you must bear any costs associated with your Internet
access.
Can I revoke or change my vote after I submit my
proxy?
Stockholders of Record.
If you are a stockholder of record, you may revoke your proxy at
any time before it is voted at the Special Meeting by:
•signing
and returning a new proxy card with a later date;
•entering
a new vote by telephone or via the Internet by 11:59 p.m. Eastern
Time on January 5, 2023;
•delivering
a written revocation to our Chief Financial Officer at Summit
Therapeutics Inc., 2882 Sand Hill Road, Suite 106, Menlo Park,
California 94025 by 5:00 p.m. Eastern Time on January 5, 2023;
or
•following
the instructions at
www.virtualshareholdermeeting.com/SMMT2023SM.
Beneficial Owners.
If you are a beneficial owner of your shares, you must contact the
broker, bank or other nominee holding your shares and follow their
instructions on changing your vote.
What if I do not specify how my shares are to be
voted?
Stockholders of Record.
If you are a stockholder of record and you submit a proxy, but you
do not provide voting instructions, your shares will be
voted:
•“FOR”
the approval of the amendment to the Company’s Restated Certificate
of Incorporation to increase the number of authorized shares of
common stock by 650,000,000 (from 350,000,000 to
1,000,000,000);
•“FOR”
the approval of the amendment to the Company’s Restated Certificate
of Incorporation to effect the Reverse Stock Split;
•In
the discretion of the named proxies regarding any other matters
properly presented for vote at the Special Meeting.
Beneficial Owners.
If you are a beneficial owner and you do not provide your broker,
bank or other nominee with voting instructions, your broker, bank
or other nominee will determine if it has the discretionary
authority to vote on the particular matter. Under the rules of The
Nasdaq Capital Market, brokers, banks and other nominees do not
have discretion to vote on non-routine matters absent direction
from you.
What constitutes a quorum, and why is a quorum
required?
A quorum is the minimum number of shares required to be present at
the Special Meeting for the Special Meeting to be properly held
under our bylaws and Delaware law. The presence (including by
proxy) of a majority of all issued and outstanding shares of our
common stock entitled to vote at the Special Meeting will
constitute a quorum at the Special Meeting. As of the close of
business on the record date of December 5, 2022, we had 201,321,175
shares of common stock outstanding and entitled to vote at the
Special Meeting, meaning that 100,660,588 shares of common stock
must be represented at the Special Meeting to constitute a
quorum.
Your shares will be counted towards the quorum if you submit a
proxy or vote at the Special Meeting. Abstentions and broker
non-votes will also count towards the quorum requirement. If there
is not a quorum, a majority of the shares present at the Special
Meeting may adjourn the meeting to a later date.
What is the effect of a broker non-vote?
Brokers, banks or other nominees who hold shares of our common
stock for a beneficial owner have the discretion to vote on routine
proposals when they have not received voting instructions from the
beneficial owner at least ten days prior to the Special Meeting. A
broker non-vote occurs when a broker, bank or other nominee does
not receive voting instructions from the beneficial owner and does
not have the discretion to direct the voting of the shares. Broker
non-votes will be counted for purposes of calculating whether a
quorum is present at the Special Meeting but will not be counted
for purposes of determining the number of votes present and
entitled to vote with respect to a particular proposal. A broker or
other nominee cannot vote without instructions on non-routine
matters.
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Proposal |
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Vote Required |
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Broker
Discretionary
Voting Allowed |
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Proposal 1: Approval of the amendment to the Company’s Restated
Certificate of Incorporation to increase the number of authorized
shares of common stock. |
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The affirmative vote of the holders of a majority of outstanding
stock entitled to vote. |
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Yes
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Proposal 2: Approval of the amendment to the Company’s Restated
Certificate of Incorporation to effect the Reverse Stock
Split. |
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The affirmative vote of the holders of a majority of outstanding
stock entitled to vote. |
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Yes
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What is the vote required for each proposal?
With respect to Proposal 1, you may vote FOR, AGAINST or ABSTAIN.
If you ABSTAIN from voting on this proposal, your abstention will
act as a vote against approval of the Charter Amendment. Shares
represented by executed, but unmarked, proxies will be voted “FOR”
the approval of the Charter Amendment.
With respect to Proposal 2, you may vote FOR, AGAINST or ABSTAIN.
If you ABSTAIN from voting on this proposal, your abstention will
act as a vote against approval of the Charter Amendment to effect
the Reverse Stock Split. Shares represented by executed, but
unmarked, proxies will be voted “FOR” the approval of the Charter
Amendment to effect the Reverse Stock Split.
Broker non-votes are not anticipated to be received since both
proposals are routine matters.
Who will count the votes?
Broadridge Corporate Issuer Solutions, Inc. (“Broadridge”) has been
engaged to receive and tabulate stockholder votes. Broadridge will
separately tabulate FOR and AGAINST votes, abstentions, and broker
non-votes. Broadridge will also certify the election results and
perform any other acts required by the Delaware General Corporation
Law.
Who is paying for the costs of this proxy
solicitation?
We will bear the entire cost of proxy solicitation, including the
preparation, assembly, printing, mailing and distribution of the
proxy materials. Solicitations may be made personally or by mail,
facsimile, telephone, messenger, or via the Internet by our
personnel who will not receive additional compensation for such
solicitation. In addition, we will reimburse brokerage firms and
other custodians for their reasonable out-of-pocket expenses for
forwarding the proxy materials to stockholders.
How can I find the results of the Special Meeting?
Preliminary results will be announced at the Special Meeting. Final
results also will be published in a Current Report on Form 8-K to
be filed with the Securities and Exchange Commission (the “SEC”)
after the Special Meeting.
What does it mean if I receive more than one set of printed
materials?
If you receive more than one set of printed materials, your shares
may be registered in more than one name and/or are registered in
different accounts.
Please follow the voting instructions on each set of printed
materials, as applicable, to ensure that all of your shares are
voted.
I share an address with another stockholder, and we received only
one paper copy of the proxy materials. How may I obtain an
additional copy of the proxy materials?
The SEC has adopted rules that allow a company to deliver a single
proxy statement to an address shared by two or more of its
stockholders. This method of delivery, known as “householding,”
permits us to realize significant cost savings, reduces the amount
of duplicate information stockholders receive, and reduces the
environmental impact of printing and mailing documents to our
stockholders. Under this process, certain stockholders will receive
only one copy of our proxy materials and any additional proxy
materials that are delivered until such time as one or more of
these stockholders notifies us that they want to receive separate
copies. Any stockholders who object to or wish to begin
householding may notify our Investor Relations Department at
investors@summitplc.com or Investor Relations, Summit Therapeutics
Inc., 2882 Sand Hill Road, Suite 106, Menlo Park, California
94025.
Beneficial owners may contact their broker, bank or other nominee
to request information about householding.
What is the deadline to propose actions for consideration at next
year’s annual meeting of stockholders or to nominate individuals to
serve as directors?
Stockholder Proposals for 2023 Annual Meeting. The submission
deadline for stockholder proposals to be included in our proxy
materials for the 2023 annual meeting of stockholders pursuant to
Rule 14a-8 of the Securities Exchange Act of 1934, as amended is
December 30, 2022 except as may otherwise be provided in Rule
14a-8. All such proposals must be in writing and received by our
Corporate Secretary at Summit Therapeutics Inc., 2882 Sand Hill
Road, Suite 106, Menlo Park, California 94025 by close of business
on the required deadline in order to be considered for inclusion in
our proxy materials for the 2023 annual meeting of stockholders.
Submission of a proposal before the deadline does not guarantee its
inclusion in our proxy materials.
Advance Notice Procedure for 2023 Annual Meeting. Under our Bylaws,
director nominations and other business may be brought at an annual
meeting of stockholders in accordance with the requirements of our
Bylaws as in effect from time to time. For the 2023 annual meeting
of stockholders, a stockholder notice must be received by our
Corporate Secretary at Summit Therapeutics Inc., 2882 Sand Hill
Road, Suite 106, Menlo Park, California 94025, not later than the
close of business on the 90th day nor earlier than the close of
business on the 120th day before the one-year anniversary of the
date of our 2022 annual meeting of stockholders. However, if the
2023 annual meeting of stockholders is advanced by more than 30
days prior to, or delayed by more than 60 days after, the one-year
anniversary of the 2022 annual meeting of stockholders, then, for
notice by the stockholder to be timely, it must be received by our
Corporate Secretary not earlier than the close of business on the
120th day prior to the 2023 annual meeting of stockholders and not
later than the close of business on the later of (i) the 90th day
prior to the 2023 annual meeting of stockholders, or (ii) the 10th
day following the day on which notice of the date of such annual
meeting was mailed or the day of public disclosure of the date of
such annual meeting, whichever first occurs. Please refer to the
full text of our Bylaw provisions for additional information and
requirements. A copy of our current Bylaws has been filed with the
Company’s Annual Report on Form 10-K for the year ended December
31, 2021 and may be obtained by writing to our Corporate Secretary
at the address listed in our proxy materials.
PROPOSAL 1
AMENDMENT TO THE CHARTER TO INCREASE
THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK
Our Board of Directors has unanimously adopted, and is submitting
for stockholder approval, an amendment to our Charter to increase
the number of authorized shares of our common stock by 650,000,000
(from 350,000,000 to 1,000,000,000) with the final decision of
whether to proceed with the increase in the number of authorized
shares to be determined by our Board of Directors, in its
discretion, following stockholder approval (if obtained), but no
later than January 6, 2024.
The additional shares of common stock to be authorized for issuance
under the Charter would be a part of the existing class of common
stock and, if and when issued, would have the same rights and
privileges as the common stock presently issued and outstanding.
Our common stock has no preemptive rights to purchase common stock
or other securities.
If this Proposal 1 is approved by the requisite vote of the
stockholders, the proposed Capitalization Increase will be subject
to the final Board determination of whether to implement, which may
be at any time prior to the one year anniversary of the stockholder
approval date. In the event of stockholder approval of both the
Capitalization Increase and the Reverse Stock Split, the Board will
have discretion as to whether to adopt neither, one or both
proposals at any time prior to the one year anniversary of the
stockholder approval date. If adopted by the Board following
approval by the requisite vote of the stockholders, the
Capitalization Increase will become effective upon its filing and
recording with the Secretary of State of Delaware.
Form of the Amendment
The Board has deemed the Capitalization Increase advisable and in
the best interests of the Company and is accordingly submitting it
to stockholders for approval. The Capitalization Increase would
revise the Company’s Restated Certificate of Incorporation, dated
September 18, 2020, as amended by that Amendment to the Restated
Certificate of Incorporation, dated July 27, 2022, by replacing the
first paragraph of its FOURTH Article with the following
language:
“The total number of shares of all classes of capital stock that
the Corporation shall have authority to issue is 1,020,000,000
shares, consisting of (i) 1,000,000,000 shares of common stock,
$0.01 par value per share (the “Common Stock”), and (ii) 20,000,000
shares of Preferred stock, $0.01 par value per share (the
“Preferred Stock”).”
The full text of the proposed Charter Amendment is set forth
in
Annex A
of this proxy statement. No changes are proposed to the number of
authorized shares of preferred stock.
Reasons for the Increase in the Number of Authorized
Shares
The proposed increase in the authorized number of shares of common
stock is intended to ensure that we will continue to have an
adequate number of authorized and unissued shares of common stock
for future use. As of December 5, 2022, the Company had 201,321,175
shares of common stock issued and outstanding and an aggregate of
25,417,955
shares reserved for potential future issuance upon exercise of
outstanding awards under its 2020 Stock Incentive Plan, 2016 Long
Term Incentive Plan, and its outstanding warrants. The Company may
also issue up to an additional 8,438,161 authorized shares reserved
for potential issuance of future awards under its 2020 Stock
Incentive Plan and 2020 Employee Stock Purchase Plan.
On December 5, 2022, we entered into a Collaboration and License
Agreement (the “License Agreement”) with Akeso, Inc. and its
affiliates (“Akeso”) and certain ancillary transaction documents as
set forth in the License Agreement. Pursuant to the License
Agreement, the Company is partnering with Akeso to in-license its
breakthrough bispecific antibody, ivonescimab. Ivonescimab, known
as AK112 in China and Australia, and also as SMT112 in the United
States, Canada, Europe, and Japan, is a novel, potential
first-in-class bispecific antibody combining the power of
immunotherapy via a blockade of PD-1 with the anti-angiogenesis
benefits of an anti-VEGF into a single molecule. Ivonescimab was
engineered to bring two well established oncology targeted
mechanisms together. In connection with the License Agreement, the
Company has also entered into a Supply Agreement with
Akeso, pursuant to which Summit agreed to purchase a certain
portion of drug substance for clinical and commercial.
The definitive partnership memorialized in the License Agreement
calls for Summit to receive the rights to develop and commercialize
ivonescimab (SMT112) in the United States, Canada, Europe, and
Japan. Akeso will retain development and commercialization rights
for the rest of the regions including China. In exchange for these
rights, Summit will make an upfront payment of $500 million, $300
million of which is payable within the later of 15 days or upon the
earliest date on which the parties have actual knowledge that all
applicable waiting periods under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 and any comparable extension periods with
respect to the transactions contemplated by the License Agreement
have expired or been terminated (of which 16 million shares of
Company common stock may be issued in lieu of cash) and $200
million of which is payable within 90 days. The total value of the
upfront payment and potential milestone payments is $5.0 billion,
as Akeso will be eligible to receive regulatory and commercial
milestones of up to $4.5 billion. In addition, Akeso will be
eligible to receive low double-digit royalties on net
sales.
On December 6, 2022, the Company entered into a Note Purchase
Agreement (the “Note Purchase Agreement”) and promissory notes with
the Company’s Chief Executive Officer, Chairman of the Board, and
beneficial owner of approximately 81% of the Company’s common
stock, Robert W. Duggan and Dr. Maky Zanganeh, the Company’s
co-Chief Executive Officer, President, member of the Board and
beneficial owner of approximately 6.4% of the Company’s common
stock. Pursuant to the Note Purchase Agreement, the Company agreed
to sell to Mr. Duggan and Dr. Zanganeh unsecured promissory notes
in the aggregate amount of $520 million.
The Company expects to use the proceeds of the Note Purchase
Agreement (i) for payment of the upfront obligation associated with
the License Agreement, (ii) for activities to support clinical
development and regulatory approval for SMT112; (iii) to pursue
business development opportunities to expand our pipeline of drug
candidates; and (iv) for general corporate purposes.
Pursuant to the Note Purchase Agreement, the Company has issued to
Mr. Duggan and Dr. Zanganeh unsecured promissory notes in the
amount of $400 million and $20 million, respectively (the “February
Notes”), which will mature and become due on February 15, 2023 (the
“February Maturity Date”) and an unsecured promissory note to Mr.
Duggan in the amount of $100 million (together with the February
Notes, the “Notes”), which will mature and become due on September
15, 2023 (together with the February Maturity Date, the “Maturity
Dates”). The Maturity Dates may be extended one or more times at
the Company’s election, but in no event to a date later than
September 6, 2024. The Notes accrue interest at an initial rate of
7.5%. In addition, if the Company shall consummate a public
offering, then upon the later to occur of (i) five business days
after the Company receives the net cash proceeds therefrom or (ii)
May 15, 2023, the February Notes shall be prepaid by an amount
equal to the lesser of (a) 100% of the amount of the net proceeds
of such offering and (b) the outstanding principal amount on such
Notes. The Company may prepay any portion of the Notes at its
option without penalty. It is anticipated that the February Notes
will be repaid in connection with the consummation of the
anticipated rights offering announced by the Company, as described
below.
On December 6, 2022, the Company issued a press release announcing
the approval by the Board of a rights offering to its stockholders.
The rights offering will be made through the distribution of
non-transferable subscription rights to purchase shares of Common
Stock as of the close of the market on the record date to be
determined by the Board, but which will be no earlier than January
23, 2023, at a price per share equal to the lesser of (i) $1.05, or
(ii) the volume weighted-average price of the Common Stock for the
five consecutive trading days through and including the expiration
date of the offering. Assuming that the rights offering is fully
subscribed, the Company expects to receive gross proceeds of up to
$500 million, less expenses related to the rights offering. The
Company intends to register the rights offering with the Securities
and Exchange Commission (the “SEC”) by filing a prospectus on Form
S-1. The proposed increase in the authorized number of shares of
common stock is a condition to closing the rights offering. In
addition, the proposed Capitalization Increase will also provide
the Company with the ability to offer additional equity securities
in the future.
Our Board recommends the proposed increase in the authorized number
of shares of common stock to facilitate issuing shares in the event
that, in addition to the proposed rights offering, the Board
determines that it is necessary or appropriate to (i) provide
financial flexibility to raise additional capital through the sale
of equity securities, convertible securities or other equity-linked
securities, (ii) enter into additional strategic
business
transactions, (iii) provide equity incentives to directors,
officers and employees pursuant to equity compensation plans or
(iv) other general corporate purposes. The availability of
additional shares of common stock is particularly important in the
event that the Board needs to undertake any of the foregoing
actions on an expedited basis, as market conditions permit and
favorable financing and business opportunities become available,
and thus without the potential delay and expense associated with
convening a special stockholders’ meeting. In considering and
planning for our current and future corporate needs, our Board
believes that the current number of authorized and unreserved
shares of common stock available for issuance is inadequate. If
stockholders do not vote to approve this Proposal 1, the Company
may be unable to issue shares when needed; approving this Proposal
1 will help avoid that issue.
The Board has not authorized the Company to take any action with
respect to the shares that would be authorized under this proposal,
however, authorization will be required in connection with closing
the above-referenced rights offering.
Effects of the Increase in the Number of Authorized
Shares
If our stockholders approve this proposal to increase the number of
authorized shares of common stock, unless otherwise required by
applicable law or stock exchange rules, our Board will be able to
issue the additional shares of common stock from time to time in
its discretion without further action or authorization by
stockholders. The newly authorized shares of common stock would be
issuable for any proper corporate purposes, including future
capital raising transactions of equity or convertible debt
securities, acquisitions, investment opportunities, the
establishment of collaborations or other strategic agreements,
stock splits, stock dividends, issuance under current or future
equity incentive plans or for other general corporate
purposes.
The proposed increase in the number of authorized shares of common
stock will not, by itself, have an immediate dilutive effect on our
current stockholders. However, the future issuance of additional
shares of common stock or securities convertible into our common
stock could, in the proposed rights offering or otherwise,
depending on the circumstances, have a dilutive effect on the
earnings per share, book value per share, voting power
and percentage interest of our existing stockholders, none of
whom have preemptive rights to subscribe for additional shares of
common stock that we may issue, and could depress the market price
of the common stock. In addition to the proposed rights offering,
we may sell shares of common stock at a price per share that is
less than the current price per share and less than the price per
share paid by our current stockholders. We may also sell securities
in the future that could have rights superior to existing
stockholders.
Potential Anti-Takeover Effect
An increase in the number of authorized shares of common stock may
also, under certain circumstances, be construed as having an
anti-takeover effect. Although not designed or intended for such
purposes, the effect of the proposed increase might be to render
more difficult or to discourage a merger, tender offer, proxy
contest or change in control of us and the removal of management,
which stockholders might otherwise deem favorable. For example, the
authority of our Board to issue common stock might be used to
create voting impediments or to frustrate an attempt by another
person or entity to effect a takeover or otherwise gain control of
us because the issuance of additional shares of common stock would
dilute the voting power of the common stock then outstanding. Our
common stock could also be issued to purchasers who would support
our Board in opposing a takeover bid which our Board determines not
to be in our best interests and those of our
stockholders.
The Board is not presently aware of any attempt, or contemplated
attempt, to acquire control of the Company and the proposed Charter
Amendment to increase the number of authorized shares of common
stock is not part of any plan by our Board to recommend or
implement a series of anti-takeover measures.
Effectiveness of the Charter Amendment and Required
Vote
Upon receipt of the necessary stockholder approval, the Board will
make a final determination as to whether to proceed and file with
the Secretary of State of the State of Delaware the amendment to
its Charter to implement the Capitalization Increase. The amendment
to the Charter to effect the Capitalization Increase would become
effective upon such filing. Our Board reserves the right,
notwithstanding stockholder approval of the
Capitalization Increase and without further action by our
stockholders, not to proceed with the amendment at any time before
the filing of the Capitalization Increase.
Vote Required
In accordance with Delaware law, approval and adoption of this
proposal requires the affirmative vote of at least a majority of
our issued and outstanding shares entitled to vote either in person
or by proxy at the meeting. Accordingly, abstentions will have the
same effect as a vote against the proposal. Shares represented by
valid proxies and not revoked will be voted at the meeting in
accordance with the instructions given. If no voting instructions
are given, such shares will be voted “FOR” this
proposal.
The Board of Directors unanimously recommends a vote
“FOR”
the amendment to the Charter to increase the authorized number of
shares of Common Stock.
PROPOSAL 2
APPROVAL OF AMENDMENT TO THE CHARTER TO EFFECT A REVERSE STOCK
SPLIT
Background and Proposed Amendment
Our Board of Directors has unanimously adopted, and is submitting
for stockholder approval, an amendment to our Charter, as amended,
in substantially the form attached hereto as
Annex B
(the “Reverse
Stock Split Charter Amendment”)
to effect the Reverse Stock Split at a ratio of between 1-for-5 and
1-for-10, with the final decision of whether to proceed with the
Reverse Stock Split and the exact ratio of the Reverse Stock Split
to be determined by our Board of Directors, in its discretion,
following stockholder approval (if obtained), but no later than
January 6, 2024. If the stockholders approve the Reverse Stock
Split, and the Board decides to implement it, the Reverse Stock
Split will become effective upon the filing of the Reverse Stock
Split Charter Amendment with the Delaware Secretary of State. In
the event of stockholder approval of both the Capitalization
Increase and the Reverse Stock Split, the Board will have
discretion as to whether to adopt neither, one or both proposals at
any time prior to the one year anniversary of the stockholder
approval date.
The Reverse Stock Split will be realized simultaneously for all
outstanding common stock. The Reverse Stock Split will affect all
holders of common stock uniformly and no stockholder’s interest in
the Company will be diluted as each stockholder will hold the same
percentage of common stock outstanding immediately following the
Reverse Stock Split as that stockholder held immediately prior to
the Reverse Stock Split, except for immaterial adjustments that may
result from the treatment of fractional shares as described below.
The Reverse Stock Split Charter Amendment will not reduce the
number of authorized shares of common stock (which will remain at
350,000,000) and will not change the par value of the common stock
(which will remain at $0.01 per share).
Reasons for the Reverse Stock Split
With a high number of issued and outstanding shares of common
stock, the price per each share of our common stock may be too low
for the Company to attract investment capital on reasonable terms
for the Company. We believe that the Reverse Stock Split will make
our common stock more attractive to a broader range of
institutional investors, professional investors and other members
of the investing public. Many brokerage houses and institutional
investors have internal policies and practices that either prohibit
them from investing in low-priced stocks or tend to discourage
individual brokers from recommending low-priced stocks to their
customers. In addition, some of those policies and practices may
function to make the processing of trades in low-priced stocks
economically unattractive to brokers. Moreover, because brokers’
commissions on low-priced stocks generally represent a higher
percentage of the stock price than commissions on higher-priced
stocks, the current average price per share of common stock can
result in individual stockholders paying transaction costs
representing a higher percentage of their total share value than
would be the case if the share price were substantially higher. We
believe that the Reverse Stock Split may make our common stock a
more attractive and cost-effective investment for many investors,
which may enhance the liquidity of the holders of our common
stock.
In addition, we believe that the Reverse Stock Split will help us
achieve a number of important goals, including enhancing our
ability to continue to satisfy the continued listing requirements
of Nasdaq Capital Market. One of the listing requirements common to
national securities exchanges is that the bid price of our common
stock be at a specified minimum per share. Reducing the number of
outstanding shares of our common stock should, absent other
factors, result in an increase in the per share market price of our
common stock, although we cannot provide any assurance that our
minimum bid price would, following the Reverse Stock Split, remain
over any applicable minimum bid price requirements. The Reverse
Stock Split will also effectively increase the number of authorized
and unissued shares of our common stock available for future
issuance by the amount of the reduction in outstanding shares
effected by the Reverse Stock Split.
Although reducing the number of outstanding shares of our common
stock through the Reverse Stock Split is intended, absent other
factors, to increase the per share market price of our common
stock, other factors, such as our financial results, market
conditions and the market perception of our business, may adversely
affect the market price of our common stock. As a result, there can
be no assurance that the Reverse Stock Split, if completed, will
result in the intended benefits described above, or that the market
price of our common stock will increase (proportionately to the
reduction in the number of shares of our common stock after the
Reverse Stock Split or
otherwise) following the Reverse Stock Split or that the market
price of our common stock will not decrease in the
future.
If the Reverse Stock Split Charter Amendment is effected, it would
cause a decrease in the total number of shares of our common stock
outstanding and increase the market price of our common stock, as
well as effectively increase the number of authorized and unissued
shares of our common stock available for future issuance. The Board
intends to effect the Reverse Stock Split only if it believes that
a decrease in the number of shares outstanding is in the best
interests of the Company and our stockholders and is likely to
improve the trading price of our common stock and improve the
likelihood that we will be able to satisfy the continued listing
requirements of Nasdaq Capital Market. Accordingly, our Board
approved the Reverse Stock Split Charter Amendment and recommended
it be submitted to stockholders for approval.
Consequences of Not Obtaining Stockholder Approval of the Reverse
Stock Split
If we do not obtain stockholder approval of the Reverse Stock Split
and if we need additional capital to fund operations and at such
time do not have a sufficient number of authorized and unissued
shares of common stock to raise such additional capital, our
business would be materially and adversely affected. In addition,
if we are unable to satisfy the continued listing requirements for
the Nasdaq Capital Market, we may be delisted from the
exchange.
If stockholder approval for the Reverse Stock Split is not
obtained, the number of shares of our common stock that are issued
and outstanding will not change and the anticipated benefits of the
Reverse Stock Split described above under “Reasons for the Reverse
Stock Split” will not be achieved.
Principal Effects of the Reverse Stock Split
A reverse stock split refers to a reduction in the number of
outstanding shares of a class of a corporation’s capital stock,
which may be accomplished, as in this case, by reclassifying and
combining all of our outstanding shares of common stock into a
proportionately smaller number of shares. For example, a
stockholder holding 100,000 shares of common stock before the
reverse stock split would instead hold 10,000 shares of common
stock immediately after the reverse stock split if the ratio at
which the board of directors determines the ratio to be 1-for-10.
Each stockholder’s proportionate ownership of outstanding shares of
common stock would remain the same, subject to immaterial
adjustments due to the issuance of an additional share in lieu of a
fractional share. All shares of common stock will remain validly
issued, fully paid and non-assessable.
After the Effective Time, as defined below, of the Reverse Stock
Split, our common stock will have a new committee on uniform
securities identification procedures number, also known as a CUSIP
number, which is a number used to identify our common stock. Our
common stock is currently registered under Section 12(b) of the
Exchange Act, and we are subject to the periodic reporting and
other requirements of the Exchange Act. The proposed Reverse Stock
Split will not affect the registration of our common stock under
the Exchange Act.
Effect on Authorized but Unissued Shares
Pursuant to the Reverse Stock Split Charter Amendment, each holder
of our common stock outstanding immediately prior to the
effectiveness of the Reverse Stock Split (“Old
Common Stock”)
will become the holder of fewer shares of our common stock
(“New
Common Stock”)
after consummation of the Reverse Stock Split.
The table below provides examples of reverse stock splits at
various ratios between 1-for-5 and 1-for-10, without giving effect
to the treatment of fractional shares. The actual number of shares
outstanding after giving effect to the Reverse Stock Split, if
effected, will depend on the actual ratio that is determined by our
board of directors.
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Shares outstanding at December 5, 2022 |
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Reverse Stock Split Ratio |
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Shares outstanding after Reverse Stock Split |
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Reduction in Shares Outstanding |
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201,321,175 |
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1-for-5 |
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40,264,235 |
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80% |
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201,321,175 |
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1-for-10 |
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20,132,118 |
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90% |
The Reverse Stock Split will affect all stockholders equally and
will not affect any stockholder’s proportionate equity interest in
the Company, except for those stockholders who receive an
additional share of our common stock in lieu of a fractional share.
None of the rights currently accruing to holders of our common
stock will be affected by the Reverse Stock Split. Following the
Reverse Stock Split, each share of New Common Stock will entitle
the holder thereof to one vote per share and will otherwise be
identical to Old Common Stock. The Reverse Stock Split also will
have no effect on the number of authorized shares of our Common
Stock. The shares of New Common Stock will be fully paid and
non-assessable.
The par value per share of the Common Stock will remain unchanged
at $0.01 per share after the Reverse Stock Split. As a result, on
the Effective Time of the Reverse Stock Split, if any, the stated
capital on our balance sheet attributable to the common stock will
be reduced proportionately based on the Reverse Stock Split ratio,
from its present amount, and the additional paid-in capital account
will be credited with the amount by which the stated capital is
reduced. After the Reverse Stock Split, net income or loss per
share and other per share amounts will be increased because there
will be fewer shares of our common stock outstanding. In future
financial statements, net income or loss per share and other per
share amounts for periods ending before the Reverse Stock Split
would be recast to give retroactive effect to the Reverse Stock
Split. The Company does not anticipate that any other accounting
consequences would arise as a result of the Reverse Stock
Split.
Risks Associated with the Reverse Stock Split
The Reverse Stock Split may not increase the price of our common
stock over the long-term.
As noted above, a principal purpose of the Reverse Stock Split is
to increase the trading price of our common stock to enhance our
ability to satisfy Nasdaq Capital Market’s continued listing
requirements. However, the effect of the Reverse Stock Split on the
market price of our common stock cannot be predicted with any
certainty, and we cannot assure you that the Reverse Stock Split
will accomplish this objective for any meaningful period of time,
or at all. While we expect that the reduction in the number of
outstanding shares of common stock will proportionally increase the
market price of our common stock, we cannot assure you that the
Reverse Stock Split will increase the market price of our common
stock by a multiple of the Reverse Stock Split ratio, or result in
any permanent or sustained increase in the market price of our
common stock. The market price of our common stock may be affected
by other factors which may be unrelated to the number of shares
outstanding, including the Company’s business and financial
performance, general market conditions, and prospects for future
success.
The Reverse Stock Split may decrease the liquidity of our common
stock.
The Board believes that the Reverse Stock Split may result in an
increase in the market price of our common stock, which could lead
to increased interest in our common stock and possibly promote
greater liquidity for our stockholders. However, the Reverse Stock
Split will also reduce the total number of outstanding shares of
common stock, which may lead to reduced trading and a smaller
number of market makers for our common stock, particularly if the
price per share of our common stock does not increase as a result
of the Reverse Stock Split.
The Reverse Stock Split may result in some stockholders owning “odd
lots” that may be more difficult to sell or require greater
transaction costs per share to sell.
If the Reverse Stock Split is implemented, it will increase the
number of stockholders who own “odd lots” of less than 100 shares
of common stock. A purchase or sale of less than 100 shares of
common stock (an “odd lot” transaction) may result in incrementally
higher trading costs through certain brokers, particularly “full
service” brokers. Therefore, those stockholders who own fewer than
100 shares of common stock following the Reverse Stock Split may be
required to pay higher transaction costs if they sell their common
stock.
The Reverse Stock Split may lead to a decrease in our overall
market capitalization.
The Reverse Stock Split may be viewed negatively by the market and,
consequently, could lead to a decrease in our overall market
capitalization. If the per share market price of our common stock
does not increase in proportion to the Reverse Stock Split ratio,
or following such increase does not maintain or exceed such price,
then the value of our Company, as measured by our market
capitalization, will be reduced. Additionally, any reduction in our
market capitalization may be magnified as a result of the smaller
number of total shares of common stock outstanding following the
Reverse Stock Split.
Anti-Takeover and Dilutive Effects
In addition, we have not proposed the Reverse Stock Split, with its
corresponding increase in the authorized and unissued number of
shares of common stock, with the intention of using the additional
shares for anti-takeover purposes, although we could theoretically
use the additional shares to make it more difficult or to
discourage an attempt to acquire control of the
Company.
We do not believe that our officers or directors have interests in
this proposal that are different from or greater than those of any
other of our stockholders.
Effect on Registered and Beneficial Stockholders
If you hold shares of common stock in “street name” through an
intermediary, we will treat your common stock in the same manner as
stockholders whose shares are registered in their own names.
Intermediaries will be instructed to effect the Reverse Stock Split
for their customers holding common stock in street name. However,
these intermediaries may have different procedures for processing a
reverse stock split. If you hold shares of common stock in street
name, we encourage you to contact your intermediaries.
Registered
“Book-Entry” Holders of Common Stock
If you hold shares of common stock
electronically in book-entry form with our transfer agent,
Computershare Trust Company, N.A., you do not currently have and
will not be issued stock certificates evidencing your ownership
after the reverse stock split, and you do not need to take action
to receive post-reverse stock split shares. If you are entitled to
post-reverse stock split shares, a transaction statement will
automatically be sent to you indicating the number of shares of
common stock held following the reverse stock split.
Effect
on Registered Stockholders Holding Certificates
Some stockholders of record hold
their shares of our common stock in certificate form or a
combination of certificate and book-entry form. If any of your
shares of our common stock are held in certificate form, you will
receive a letter of transmittal from the Company’s transfer agent,
Computershare Trust Company, N.A., containing instructions on how a
stockholder should surrender its, his or her certificate(s)
representing shares of Old Common Stock to the transfer agent in
exchange for certificate(s) representing shares of New Common
Stock. No certificate(s) representing shares of New Common Stock
will be issued to a stockholder until such stockholder has
surrendered all certificate(s) representing shares of Old Common
Stock, together with a properly completed and executed letter of
transmittal, to the transfer agent. No stockholder will be required
to pay a transfer or other fee to exchange its, his or her
certificate(s) shares of Old Common Stock for certificate(s)
representing shares of New Common Stock registered in the same
name.
Effect on Outstanding Options and Warrants
Upon a reverse stock split, all outstanding options, warrants and
future or contingent rights to acquire common stock will be
adjusted to reflect the Reverse Stock Split. With respect to all
outstanding options and warrants to purchase common stock, the
number of shares of common stock that such holders may purchase
upon exercise of such options or warrants will decrease, and the
exercise prices of such options or warrants will increase, in
proportion to the fraction by which the number of shares of common
stock underlying such options and warrants are reduced as a result
of the Reverse Stock Split. Also, the number of shares reserved for
issuance under our existing stock incentive and employee stock
purchase plans would be equitably adjusted by the Company in the
manner determined by the Board.
Fractional Shares
Fractional shares will not be issued in connection with the Reverse
Stock Split. Each stockholder who would otherwise hold a fractional
share of common stock as a result of the Reverse Stock Split will
receive one share of common stock in lieu of such fractional share.
If such shares are subject to an award granted under
an
Incentive Plan, each fractional share of common stock will be
rounded down to the nearest whole share of common stock in order to
comply with the requirements of Sections 409A and 424 of the
Code.
Appraisal Rights
Under the Delaware General Corporation Law, our stockholders are
not entitled to appraisal or dissenter’s rights with respect to the
Reverse Stock Split, and we will not independently provide our
stockholders with any such rights.
Regulatory Approvals
The Reverse Stock Split will not be consummated, if at all, until
after approval of the Company’s stockholders is obtained. The
Company is not obligated to obtain any governmental approvals or
comply with any state or federal regulations prior to consummating
the Reverse Stock Split other than the filing of the Reverse Stock
Split Amendment with the Secretary of State of the State of
Delaware.
Procedure for Effecting the Reverse Stock Split
If our stockholders approve this proposal, and the board of
directors elects to effect the Reverse Stock Split, we will effect
the Reverse Stock Split by filing the Reverse Stock Split Charter
Amendment with the Secretary of State of the State of Delaware. The
Reverse Stock Split will become effective, and the combination of,
and reduction in, the number of our outstanding shares as a result
of the Reverse Stock Split will occur automatically, at the time of
the filing of the Reverse Stock Split Charter Amendment (referred
to as the “Effective
Time”),
without any action on the part of our stockholders and without
regard to the date that stock certificates representing any
certificated shares prior to the Reverse Stock Split are physically
surrendered for new stock certificates. Beginning at the Effective
Time, each certificate representing pre-Reverse Stock Split shares
will be deemed for all corporate purposes to evidence ownership of
post-Reverse Stock Split shares. The text of the Reverse Stock
Split Charter Amendment is subject to modification to include such
changes as may be required by the office of the Secretary of State
of the State of Delaware and as the Board deems necessary and
advisable to effect the Reverse Stock Split.
The board of directors reserves the right, notwithstanding
stockholder approval and without further action by the
stockholders, to elect not to proceed with the Reverse Stock Split
if, at any time prior to filing the Reverse Stock Spit Charter
Amendment, the Board, in its sole discretion, determines that it is
no longer in the best interests of the Company and its stockholders
to proceed with the Reverse Stock Split. By voting in favor of the
Reverse Stock Split, you are also expressly authorizing the Board
to delay or abandon the Reverse Stock split. Stockholders should
not destroy any stock certificate(s) and should not submit any
certificate(s) until they receive a letter of transmittal from our
transfer agent.
Certain Material U.S Federal Income Tax Consequences of the Reverse
Stock Split
The following is a summary of certain material United States
federal income tax consequences of the Reverse Stock Split to our
stockholders. This summary does not purport to be a complete
discussion of all of the possible federal income tax consequences
of the Reverse Stock Split and is included for general information
only. Further, it does not address any state, local or foreign
income or other tax consequences. Also, it does not address the tax
consequences to stockholders that are subject to special tax rules,
including but not limited to banks, insurance companies, regulated
investment companies, personal holding companies, foreign entities,
nonresident alien individuals, broker-dealers, traders, and
tax-exempt entities. Other stockholders also may be subject to
special tax rules, including but not limited to: stockholders who
received common stock as compensation for services or pursuant to
the exercise of an employee stock option, or stockholders who have
held, or will hold, stock as part of a straddle, hedging or
conversion transaction for federal income tax purposes. This
summary also assumes that you are a United States holder (defined
below) who has held, and will hold, shares of common stock as a
“capital asset,” as defined in the Internal Revenue Code of 1986,
as amended (the “Code”),
generally, property held for investment. Finally, the following
discussion does not address the tax consequences of transactions
occurring prior to or after the Reverse Stock Split (whether or not
such transactions are in connection with the Reverse Stock Split),
including, without limitation, the exercise of options or rights to
purchase common stock in anticipation of the Reverse Stock Split or
otherwise.
The tax treatment of a
stockholder may vary depending upon the particular facts and
circumstances of such stockholder. You should consult with your own
tax advisor with respect to your tax consequences of the Reverse
Stock Split. As used herein, the term “United States holder” means
a stockholder that is, for federal income tax purposes: a citizen
or resident of the United States; a corporation or other entity
taxed as a corporation created or organized in or under the laws of
the United States or any state, including the District of Columbia;
an estate the income of which is subject to federal income tax
regardless of its source; or a trust that (i) is subject to the
primary supervision of a U.S. court and the control of one of more
U.S. persons or (ii) has a valid election in effect under
applicable U.S. Treasury regulations to be treated as a U.S.
person.
The following discussion is based on the Code, applicable Treasury
Regulations, judicial authority and administrative rulings and
practice, all as of the date hereof. The Internal Revenue Service
could adopt a contrary position. In addition, future legislative,
judicial or administrative changes or interpretations could
adversely affect the accuracy of the statements and conclusions set
forth herein. Any such changes or interpretations could be applied
retroactively and could affect the tax consequences described
herein. No ruling from the Internal Revenue Service or opinion of
counsel has been obtained in connection with the Reverse Stock
Split.
No gain or loss should be recognized by a stockholder upon such
stockholder’s exchange of pre-Reverse Stock Split shares of common
stock for post-Reverse Stock Split shares of common stock pursuant
to the Reverse Stock Split. The aggregate tax basis of the
post-Reverse Stock Split shares received in the Reverse Stock Split
(including any whole share received in exchange for a fractional
share) will be the same as the stockholder’s aggregate tax basis in
the pre-Reverse Stock Split shares exchanged therefore. The
stockholder’s holding period for the post-Reverse Stock Split
shares will include the period during which the stockholder held
the pre-Reverse Stock Split shares surrendered in the Reverse Stock
Split.
THE PRECEDING DISCUSSION IS INTENDED ONLY AS A SUMMARY OF CERTAIN
FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT AND DOES
NOT PURPORT TO BE A COMPLETE ANALYSIS OR DISCUSSION OF ALL
POTENTIAL TAX EFFECTS RELEVANT THERETO. YOU ARE STRONGLY ADVISED TO
CONSULT YOUR OWN TAX ADVISORS AS TO THE PARTICULAR FEDERAL, STATE,
LOCAL, FOREIGN AND OTHER TAX CONSEQUENCES OF THE REVERSE STOCK
SPLIT IN LIGHT OF YOUR SPECIFIC CIRCUMSTANCES.
Accounting Matters
The par value of the common stock will remain unchanged at $0.01
per share after the Reverse Stock Split. As a result, our stated
capital, which consists of the par value per share of the common
stock multiplied by the aggregate number of shares of the common
stock issued and outstanding, will be reduced proportionately at
the Effective Time of the Reverse Stock Split. Correspondingly, our
additional paid-in capital, which consists of the difference
between our stated capital and the aggregate amount paid to us upon
the issuance of all currently outstanding shares of common stock,
will be increased by a number equal to the decrease in stated
capital. Further, net loss per share, book value per share and
other per share amounts will be increased as a result of the
Reverse Stock Split because there will be fewer shares of common
stock outstanding.
Vote Required
In accordance with Delaware law, approval and adoption of this
proposal requires the affirmative vote of at least a majority of
our issued and outstanding shares entitled to vote either in person
or by proxy at the meeting. Accordingly, abstentions and broker
non-votes will have the same effect as a vote against the proposal.
Shares represented by valid proxies and not revoked will be voted
at the meeting in accordance with the instructions given. If no
voting instructions are given, such shares will be voted “FOR” this
proposal.
The Board of Directors unanimously recommends a vote
“FOR”
the Approval of the Charter Amendment to Effect The Reverse Stock
Split.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth certain information as of December
5, 2022 with respect to the beneficial ownership of our common
stock by (i) each person we believe beneficially holds more than 5%
of the outstanding shares of our common stock based solely on our
review of SEC filings or information provided to us by such person;
(ii) each director and nominee; and (iii) all directors and
executive officers as a group. As of December 5, 2022, 201,321,175
shares of our common stock were issued and outstanding. Unless
otherwise indicated, all persons named as beneficial owners of our
common stock have sole voting power and sole investment power with
respect to the shares indicated as beneficially owned. Unless
otherwise noted below, the address of each stockholder listed on
the table is c/o Summit Therapeutics Inc., 2882 Sand Hill Road,
Suite 106, Menlo Park, California 94025.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and address of beneficial owner |
Number of Shares Owned
(1)
|
Right to Acquire Shares
(2)
|
Total Beneficial Ownership |
Percent of Class
(3)
|
|
5% Stockholders: |
|
|
|
|
|
Robert W. Duggan
(4)
|
162,532,792 |
3,985,055 |
166,517,847 |
81.1% |
|
Mahkam Zanganeh
(5)
|
10,556,992 |
2,424,500 |
12,981,492 |
6.4% |
|
Named executive officers and directors:
|
|
|
|
|
|
Robert W. Duggan(4)
|
162,532,792 |
3,985,055 |
166,517,847 |
81.1% |
|
Mahkam Zanganeh(5)
|
10,556,992 |
2,424,500 |
12,981,492 |
6.4% |
|
Kenneth Clark |
– |
139,760 |
139,760 |
* |
|
Ankur Dhingra |
76,253 |
– |
76.253 |
* |
|
Ujwala Mahatme |
– |
211,212 |
211,212 |
* |
|
Manmeet S. Soni |
– |
309,719 |
309,719 |
* |
|
Robert F. Booth |
– |
6,250 |
6,250 |
* |
|
Alessandra Cesano |
– |
4,166 |
4,166 |
* |
|
|
|
|
|
|
All executive officers and directors as a group (8
people) |
173,166,037 |
7,080,662 |
180,246,699 |
87.5% |
_______________
(*) Represents beneficial ownership of less
than 1% of the outstanding shares of our common stock.
(1) Excludes shares that may be acquired
through the exercise of outstanding stock options or other equity
awards.
(2) Represents shares issuable within 60
days after December 5, 2022 upon exercise of exercisable options
and warrants; however, unless otherwise indicated, these shares do
not include any equity awards awarded after December 5,
2022.
(3) For purposes of calculating the Percent
of Class, shares that the person or entity had a right to acquire
within 60 days after December 5, 2022 are deemed to be outstanding
when calculating the Percent of Class of such person or
entity.
(4) This information is based upon a
Schedule 13D/A filed by Mr. Duggan with the Securities and Exchange
Commission on August 18, 2022 and a Form 4 filed on August 18,
2022. The 166,517,847 shares of common stock beneficially owned by
Mr. Duggan includes (i) 162,532,792 shares of common stock and (ii)
warrants to purchase 3,985,055 shares of common stock, which are
exercisable until December 24, 2029. This does not include the
9,346,434 shares issued to Mr. Duggan in connection with the Note
Purchase Agreement, dated December 6, 2022, between the Company,
Mr. Duggan and Dr. Zanganeh.
(5) This information is based upon a
Schedule 13D/A filed by Dr. Zanganeh with the Securities and
Exchange Commission on November 25, 2020 and information known to
the Company. The 12,981,492 shares of common stock beneficially
owned by Dr. Zanganeh includes (i) 10,556,992 shares of common
stock, (ii) the exercise of warrants to purchase 1,121,177 shares
of common stock, and (iii) options to purchase 1,303,323 shares of
common stock. The warrants to purchase 631,362 shares of common
stock (exercisable until December 24, 2029) are held by the Mahkam
Zanganeh Revocable Trust and the Shaun Zanganeh Irrevocable Trust.
The remaining warrants to purchase 489,815 shares of common stock
(exercisable until June 30, 2025) are held individually by Mahkam
Zanganeh. The options to purchase 1,303,323 shares of common stock
are held individually by Dr. Zanganeh. This does not include the
373,857 shares issued to Dr. Zanganeh in connection with the Note
Purchase Agreement, dated December 6, 2022, between the Company,
Mr. Duggan and Dr. Zanganeh.
STOCKHOLDER PROPOSALS
You may submit proper proposals, including recommendations of
director candidates, for inclusion in the proxy materials or
meeting agenda for future stockholder meetings by following certain
procedures outlined in this proxy statement.
PROXY SOLICITATION
We are making this solicitation of proxies on behalf of the Board,
and we will bear the cost of soliciting proxies. Proxies may be
solicited through the mail and through telephonic or telegraphic
communications to, or by meetings with, stockholders or their
representatives by directors, officers and other of our employees
who will receive no additional compensation therefore. We request
persons such as brokers, nominees and fiduciaries holding stock in
their names for others, or holding stock for others who have the
right to give voting instructions, to forward proxy material to
their principals and to request authority for the execution of the
proxy. We will reimburse such persons for their reasonable
expenses.
STOCKHOLDERS SHARING THE SAME ADDRESS
The SEC has adopted rules that allow a company to deliver a single
proxy statement to an address shared by two or more of its
stockholders. This method of delivery, known as “householding,”
permits us to realize significant cost savings, reduces the amount
of duplicate information stockholders receive, and reduces the
environmental impact of printing and mailing documents to our
stockholders. Under this process, certain stockholders will receive
only one copy of our proxy materials and any additional proxy
materials that are delivered until such time as one or more of
these stockholders notifies us that they want to receive separate
copies. Any stockholders who object to or wish to begin
householding may notify our Investor Relations Department at
investors@summitplc.com or Investor Relations, 2882 Sand Hill Road,
Suite 106, Menlo Park, California 94025.
OTHER MATTERS
This Proxy Statement is posted on our website at
https://www.summittxinc.com/ and is also available from the SEC at
its website at www.sec.gov.
The board of directors does not know of any other matters to be
presented at the Special Meeting. If any additional matters are
properly presented at the Special Meeting, the persons named in the
enclosed proxy card will have discretion to vote the shares of our
common stock they represent in accordance with their own judgment
on such matters.
It is important that your shares of our common stock be represented
at the Special Meeting, regardless of the number of shares that you
hold. You are, therefore, requested to vote by telephone or by
using the Internet as instructed on the enclosed proxy card or
execute and return, at your earliest convenience, the enclosed
proxy card in the envelope that has also been
provided.
THE BOARD OF DIRECTORS
Menlo Park, California
December 13, 2022
Annex A
AMENDMENT NO. 2
TO
RESTATED
CERTIFICATE OF INCORPORATION
OF
SUMMIT THERAPEUTICS INC.
Pursuant to Section 242 of the
General
Corporation Law of the State of Delaware
Summit Therapeutics Inc. (the “Company”),
a corporation organized and existing under and by virtue of the
General Corporation Law of the State of Delaware, does hereby
certify as follows:
A resolution was duly adopted by the Board of Directors (the
“Board”)
of the Company pursuant to Section 242 of the General
Corporation Law of the State of Delaware setting forth an amendment
to the Restated Certificate of Incorporation of the Company (the
“Charter
Amendment”)
and declaring said amendment to be advisable. The stockholders of
the Company duly approved said proposed amendment at a special
meeting of the stockholders called and held on January 6, 2023,
upon notice in accordance with Section 222 of the General
Corporation Law of the State of Delaware, by voting the necessary
number of shares as required by statute in favor of the Charter
Amendment. The resolution setting forth the amendment is as
follows:
RESOLVED, that the Board hereby approves and recommends that the
Company’s stockholders approve that the first paragraph of the
FOURTH Article of the Restated Certificate of Incorporation, dated
September 18, 2020, as amended by that Amendment to the Restated
Certificate of Incorporation, dated July 27, 2022 be deleted in its
entirety and replaced with the following language:
“The total number of shares of all classes of capital stock that
the Corporation shall have authority to issue is 1,020,000,000
shares, consisting of (i) 1,000,000,000 shares of Common stock,
$0.01 par value per share (the “Common Stock”), and (ii) 20,000,000
shares of Preferred stock, $0.01 par value per share (the
“Preferred Stock”).”
IN WITNESS WHEREOF, the Company has caused its corporate seal to be
affixed hereto and this Charter Amendment to be signed by its
[TITLE OF EMPLOYEE] this [ ] day of ____, 202_.
SUMMIT THERAPEUTICS INC.
By:
Annex B
AMENDMENT NO. 2
TO
RESTATED
CERTIFICATE OF INCORPORATION
OF
SUMMIT THERAPEUTICS INC.
Pursuant to Section 242 of the
General
Corporation Law of the State of Delaware
Summit Therapeutics Inc. (the “Corporation”),
a corporation organized and existing under and by virtue of the
General Corporation Law of the State of Delaware, does hereby
certify as follows:
1.The
original Certificate of Incorporation of this Corporation was filed
with the Secretary of State of Delaware on July 17,
2020.
2.The
Restated Certificate of Incorporation of this Corporation was filed
with the Secretary of State of Delaware on September 18, 2020 (the
“Certificate
of Incorporation”).
3.The
Certificate of Incorporation was further amended by the Amendment
to the Restated Certificate of Incorporation of Summit Therapeutics
Inc., filed with the Secretary of State of Delaware on July 27,
2022.
4.Resolutions
were duly adopted by the Board of Directors of the Corporation
setting forth this proposed Amendment No. 2 to the Certificate of
Incorporation and declaring said amendment to be advisable and
calling for the consideration and approval thereof at a meeting of
the stockholders of the Corporation.
5.Resolutions
were duly adopted by the Board of Directors of the Corporation, in
accordance with the provisions of the Certificate of Incorporation
set forth below, providing that, effective as of [●], New York
time, on [●], each [●] (#) issued and outstanding shares of the
Corporation’s Common Stock, par value $0.01 per share, shall be
converted into [●] (#) share of the Corporation’s Common Stock, par
value $0.01 per share, as constituted following such
date.
6.The
Certificate of Incorporation is hereby amended by revising Article
FOURTH to include a new paragraph as follows:
Upon the filing and effectiveness (the “Effective
Time”)
pursuant to the General Corporation Law of the State of Delaware
(the “DGCL”)
of this Certificate of Amendment to the Certificate of
Incorporation of the Corporation, each [ ] shares of the
Corporation’s common stock, par value $0.01 per share (the
“Common
Stock”),
issued and outstanding or held by the Corporation in treasury stock
immediately prior to the Effective Time shall automatically be
combined into one (1) validly issued, fully paid and non-assessable
share of Common Stock without any further action by the Corporation
or the holder thereof, subject to the treatment of fractional
interests as described below. Notwithstanding the immediately
preceding sentence, no fractional shares will be issued in
connection with the reverse stock split. Stockholders of record who
otherwise would be entitled to receive fractional shares, will be
entitled to rounding up of their fractional share to the nearest
whole share. No stockholder will receive cash in lieu of fractional
shares. Each certificate that immediately prior to the Effective
Time represented shares of Common Stock (the “Old
Certificates”)
shall thereafter represent that number of shares of Common Stock
into which the shares of Common Stock represented by the Old
Certificate shall have been combined, subject to the adjustment for
fractional shares as described above.
7.Pursuant
to the resolution of the Board of Directors, a meeting of the
stockholders of the Company was duly called and held upon notice in
accordance with Section 222 of the General Corporation Law of the
State of Delaware at which meeting the necessary number of shares
as required by statute were voted in favor of the foregoing
amendment.
8.The
foregoing amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the
State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal
to be affixed hereto and this Charter Amendment to be signed by its
[TITLE OF EMPLOYEE] this [ ] day of _____, 202_.
SUMMIT THERAPEUTICS INC.
By:
[ ]
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