Filing

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 17, 2017

 

Mast Therapeutics, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Registrant’s Telephone Number, Including Area Code: (858) 552-0866

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

 

 

 

 

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Item 1.01 Entry into a Material Definitive Agreement.

On January 21, 2017, in connection with the grants of restricted stock units (“RSUs”) described below, officers and directors of Mast Therapeutics, Inc. (“Mast” or the “Company”), who previously entered into the Lock-Up Agreement, dated January 6, 2017 (the “Lock-Up Agreement”), entered into Amendment No. 1 to Lock-Up Agreement, dated January 21, 2017 (the “Lock-Up Amendment”). The description of the Lock-Up Amendment in Item 5.02 of this Current Report on Form 8-K is incorporated in this Item 1.01 by reference. The description does not purport to be complete and is qualified in its entirety by reference to the form of Lock-up Amendment, which is filed as Exhibit 10.1 to this Current Report, and incorporated herein by reference. A copy of the Lock-Up Agreement was previously filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 9, 2017 and incorporated by reference.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On January 17, 2017, following the recommendations of its Compensation Committee, the Company’s Board of Directors made the following compensation-related decisions:

 

* Each RSU represents a right to receive one share of the Company’s common stock contingent upon satisfaction of the applicable vesting conditions. The number of units is the quotient of the amount of the cash award for the NEO divided by the closing per share sales price of the Company’s common stock on January 17, 2016, which was $0.14 per share.

The grant of RSUs is contingent upon the Awardee’s execution of a notice of grant and RSU agreement, which include the Awardee’s agreement that all of his/her outstanding and unexercised stock options will be cancelled immediately prior to, but contingent upon, the consummation of the Merger and cease to be exercisable as of such date without any accelerated vesting.  

In accordance with the notice of grant and RSU agreement, the RSUs would vest in full if the Awardee is providing services to the Company on the date the Merger is consummated (provided such date occurs on or before July 6, 2017) or immediately prior to such date.  To the extent that any NEO is a party to the Lock-Up Agreement, any sale of shares of common stock of the Company acquired upon settlement of the RSUs would be subject to the terms of the Lock-Up Agreement; provided, however, that pursuant to the Lock-Up Amendment, a sale of such shares of common stock would

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be allowed prior to the expiration of the lock-up period solely to the extent necessary to fund the payment of tax withholding obligations due with respect to the settlement of the RSUs.  

The Board approved the following grants to the NEOs:

 

 

On January 20, 2017, each of the NEOs executed and delivered his/her notice of grant and RSU agreement to the Company and the above-described RSUs were granted to the NEOs.  

If all of the RSUs approved by the Board become vested, a total of approximately 5.1 million shares of the Company’s common stock would be issuable upon settlement of the RSUs and a total of approximately 16.4 million shares subject to currently outstanding stock options would be expected to be cancelled and terminated upon consummation of the Merger because it is unlikely that an option holder would exercise an option with an exercise price that is substantially greater than the market price of the underlying security and all of the exercise prices of the Company’s outstanding options are significantly above the current market price of the Company’s common stock (with the lowest of such exercises price being $0.41 per share) and, in accordance with the terms of the RSUs, to the extent any outstanding options held by the Company’s employees and directors are not exercised prior to consummation of the Merger, they will be canceled as of that date. Pursuant to the terms of the Merger Agreement, such options would be excluded from the Company’s outstanding share total as used in calculating the Exchange Ratio (as defined in the Merger Agreement), having a beneficial effect for the Company’s stockholders on the overall ownership of the Company upon the consummation of the Merger.

Additional Information about the Merger and Where to Find It

In connection with the Merger, the Company intends to file relevant materials with the Securities and Exchange Commission (“SEC”), including a registration statement on Form S-4 that will contain a prospectus, joint proxy and information statement. Investors and security holders of the Company and Savara are urged to read these materials when they become available because they will contain important information about the Company, Savara and the Merger. The joint proxy statement, information statement, prospectus, and other relevant materials (when they become available), and any other documents filed by the Company with the SEC, may be obtained free of charge at the SEC web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by the Company by directing a written request to: Mast Therapeutics, Inc., 3611 Valley Centre Drive, Suite 500, San Diego, CA 92130, Attention: Investor Relations. Investors and security holders are urged to read the joint proxy statement, prospectus and the other relevant materials when they become available before making any voting or investment decision with respect to the Merger.

This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

Participants in the Solicitation

The Company and its directors and executive officers and Savara and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of the Company in connection with the proposed transaction. Information regarding the special interests of these directors and executive officers in the merger will be included in the joint proxy statement/prospectus referred to above. Additional information regarding the directors and executive officers of the Company is also included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and the proxy statement for the Company’s 2016 Annual Meeting of Stockholders. These documents are available free of charge at the SEC web site (www.sec.gov) and from the Company, Attn: Investor Relations, at the address described above.

Item 9.01 Financial Statements and Exhibits.

Reference is made to the Exhibit Index included with this Current Report on Form 8-K.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

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Exhibit Index

 

 

 

 

 

 

5

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Exhibit 10.1

 

Execution Version

 

 

Mast Therapeutics, Inc.

 

Amendment No. 1

to

Lock-Up Agreement

 

January 21, 2017

 

 

This Amendment No. 1 to Lock-Up Agreement (this “Amendment”) is being entered into as of January 21, 2017 by and between the undersigned and Mast Therapeutics, Inc. (the “Parent”) and shall amend the Lock-Up Agreement (the “Agreement”), dated as of January 6, 2017 executed by the undersigned in connection with the Agreement and Plan of Merger and Reorganization (the “Merger Agreement”) by and among Parent, Victoria Merger Corp., (“Merger Sub”), and Savara Inc. (the “Company”), dated as of January 6, 2017. Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the Agreement or Merger Agreement.

 

The fifth paragraph of the Agreement shall be amended and restated in its entirety to read as follows:

 

Notwithstanding the foregoing, the undersigned may transfer any of the Securities (i) as a bona fide gift or gifts or charitable contribution(s), (ii) to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, (iii) if the undersigned is a corporation, partnership, limited liability company, trust or other business entity (1) to another corporation, partnership, limited liability company, trust or other business entity that is a direct or indirect affiliate (as defined in Rule 405 promulgated under the Securities Act of 1933, as amended) of the undersigned or (2) as distributions of shares of Parent Common Stock or any security convertible into or exercisable for Parent Common Stock to limited partners, limited liability company members or stockholders of the undersigned or holders of similar equity interests in the undersigned, (iv) if the undersigned is a trust, to the beneficiary of such trust, (v) by testate succession or intestate succession, (vi) to any immediate family member, any investment fund, family partnership, family limited liability company or other entity controlled or managed by the undersigned, (vii) to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (vi), (viii) to Parent in a transaction exempt from Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) upon a vesting event of the Securities or upon the exercise of options or warrants to purchase Parent Common Stock on a “cashless” or “net exercise” basis or to cover tax withholding obligations of the undersigned in connection with such vesting or exercise (but for the avoidance of doubt, excluding all manners of exercise that would involve a sale in the open market of any securities relating to such options or warrants, whether to cover the applicable aggregate exercise price, withholding tax obligations or otherwise), (ix) to Parent in connection with the termination of employment or other termination of a service provider and pursuant to agreements in effect as of the Effective Time whereby Parent has the option to repurchase such shares or securities, (x) acquired by the undersigned in open market transactions after the Effective Time, (xi) pursuant to a bona fide third party tender offer, merger, consolidation or other similar transaction made to all holders of the Parent’s capital stock involving a change of control of the Parent, provided that in the event that such tender offer, merger, consolidation or other such transaction is not completed, the Securities shall remain subject to the restrictions contained in this Agreement, (xii) pursuant to an order of a court or regulatory agency, or (xiii) solely to the extent necessary to fund the payment of tax withholding obligations due with respect to the settlement of restricted stock units awarded to the undersigned with a grant approval date of January 17, 2017;  provided, in the case of clauses (i)-(vii), that (A) such transfer shall not involve a disposition for value and (B) the transferee agrees in writing with Parent to be bound by the terms of this Agreement; and provided, further, in the case of clauses (i)-(x), no filing by any party under

 

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Section 16(a) of the Exchange Act shall be required or shall be made voluntarily in connection with such transfer.  For purposes of this Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin.  

 

Except as expressly set forth above, the Agreement shall remain in full force and effect in accordance with its original terms. This Amendment may be executed in one or more counterparts all of which shall be considered one and the same Amendment.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware. The parties hereto have executed this Agreement on the date first above written.  

Very truly yours,

 

 

Printed Name of Holder

 

By:

Signature

 

 

Printed Name of Person Signing

(and indicate capacity of person signing if

signing as custodian, trustee, or on behalf of an entity)

 

AGREED AND ACKNOWLEDGED

 

MAST THERAPEUCTICS, INC.

 

By:

 

Name:

 

Title: