8-K

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

October 31, 2018

Date of Report (Date of Earliest Event Reported)

Sun BioPharma, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	000-55242	87-0543922
(State of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

712 Vista Blvd #305 Waconia, Minnesota	55387
(Address of Principal Executive Offices)	(Zip Code)

(952) 479-1196

(Registrant’s Telephone Number, Including Area Code)

(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 Instruction A.2):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter.)

Emerging growth company ☑

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☑

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

Our board of directors has appointed Michael T. Cullen, M.D., M.B.A., to serve as the Company’s Chief Executive Officer and President effective October 31, 2018. Dr. Cullen replaces David Kaysen, who has resigned from all positions with the Company, including Chief Executive Officer and President, and as a member of the Board of Directors, effective as of the same date.

Dr. Cullen, age 73, has served as Executive Chairman and as a director of our Company and its predecessors since founding it in November 2011 and will continue to serve in those roles. He previously served as our Chief Executive Officer and President from November 2011 to June 2015. The Company does not expect to enter into any new compensatory arrangements with Dr. Cullen in connection with his additional positions.

The Company has entered into a Consulting Agreement with Mr. Kaysen to facilitate an orderly transition. Mr. Kaysen will be compensated for his services on an hourly basis at market rates. The foregoing description of the Consulting Agreement does not purport to be complete and is qualified by the text of the Consulting Agreement, a copy of which is filed as Exhibit 10.1 to this current report on Form 8-K.

Item 7.01 Regulation FD Disclosure.

A copy of the press release announcing Dr. Cullen’s appointment and Mr. Kaysen’s resignation is furnished as Exhibit 99.1 to this current report on Form 8-K and incorporated herein by reference.

The information contained in this Item 7.01 and Exhibit 99.1 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under Section 18 and shall not be deemed to be incorporated by reference into the filings of the company under the Securities Act of 1933, as amended, or the Exchange Act.

Item 9.01 Financial Statement and Exhibits.

(d)     Exhibits

Exhibit No.	Description	Method of Filing
10.1	Consulting Agreement with David Kaysen, dated October 31, 2018	Filed Electronically
99.1	Press Release dated October 31, 2018	Furnished Electronically

SIGNATURES

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

	SUN BIOPHARMA, INC.
Date: October 31, 2018	By	/s/ Susan Horvath
		Susan Horvath Chief Financial Officer

EX-10.1

Exhibit 10.1

CONSULTING AGREEMENT

This Consulting Agreement (the “Agreement”) is entered into by and between Sun BioPharma, Inc., a Delaware corporation (the “Company”) having a place of business at 712 Vista Blvd. #305 Waconia, MN 55387 and the undersigned consultant whose name and address appear below (“Consultant”). The Company and Consultant hereby agree as follows:

1.     Consulting Services. Consultant is hereby engaged by the Company as an independent contractor, and not as an employee, to carry out the projects specified on the Description of Work attached hereto as Exhibit A, on the terms and conditions set forth in such Description of Work.

2.     Term. This Agreement shall commence upon the date specified on Exhibit A hereto and continue until the expiration of the term specified on Exhibit A hereto unless earlier terminated by the Company or Consultant by giving thirty (30) days prior written notice thereof to the other party. In addition, this Agreement may be terminated by the Company immediately in the event Consultant is not performing in compliance with the Description of Work, or in the event of any breach by Consultant of the obligations contained in this Agreement.

In the event of any termination of this Agreement pursuant to the above provisions prior to completion of the term specified on the Description of Work, the Company’s sole liability thereupon will be to pay Consultant any unpaid balance due for work performed up to and including the date of termination, if applicable.

3.     Independent Contractor. It is agreed that Consultant’s services are made available to the Company on the basis that Consultant will retain Consultant’s individual professional status and that Consultant’s relationship with the Company is that of an independent contractor and not that of an employee. Consultant will not be eligible for any employee benefits, nor will the Company make deductions from its fees to Consultant for taxes, insurance, bonds or any other subscription of any kind. Consultant will use Consultant’s own discretion in performing the tasks assigned, within the scope of work specified by the Company. Consultant agrees to indemnify and hold the Company harmless from and against any claim made by any third party against the Company based in whole or in part upon any action by Consultant or any of Consultant’s employees, associates, consultants, agents, representatives, assignees or successors in interest (collectively, “Consultant’s Associates”), which occurs pursuant to or in connection with this Agreement or the relationship or relationships contemplated by this Agreement.

4.     Confidential Information. Consultant agrees that Consultant, and all of Consultant’s Associates, shall keep in strictest confidence all information relating to the products, materials, programs, algorithms, designs, trade secrets, secret processes, techniques, structures, formulas, data and know-how, improvements, inventions, strategies, forecasts, equipment, patent position, sources of supply, customers and marketing plans and markets of the Company and all other confidential knowledge, data and information related to the business or affairs of the Company or any of its clients, customers, consultants, licensors, licensees or affiliates (collectively, “Confidential Information”) that may be acquired pursuant to or in connection with this Agreement or the relationship or relationships contemplated by this Agreement. During and after the term of this Agreement, neither Consultant nor any of Consultant’s Associates will, without the prior written consent of an officer of the Company, publish, communicate, disclose or use for any purpose any of such Confidential Information. Upon termination of this Agreement, Consultant will return to the Company all records, data, notes, reports, printouts, sketches, material, equipment and other documents or property, and all reproductions of any of the foregoing, furnished by the Company or developed or prepared pursuant to the relationship hereunder.

Notwithstanding the foregoing, it is agreed that Confidential Information shall not include any (i) information which is or becomes, through no fault of Consultant or any of Consultant’s Associates, generally known to the public, and (ii) Consultant’s and Consultant’s Associates’ skill, knowledge, know-how and experience.

5.     Assignment of Intellectual Property. Consultant agrees to transfer and assign and hereby does transfer and assign to the Company the entire right, title and interest for the entire world in and to all data, materials, software, designs, models, algorithms, writings, drawings, notebooks, documents, photographs, inventions and discoveries (collectively, “Inventions”) made or conceived or reduced to practice by Consultant or any of Consultant’s Associates, (i) in the course of accomplishing the work described on Exhibit A, Description of Work attached hereto, (ii) in the course of accomplishing other work performed pursuant to the relationship established by this Agreement, or (iii) with the use of materials or facilities of the Company. Notwithstanding the foregoing, if Consultant or any of Consultant’s Associations creates any work of authorship fixed in any tangible medium of expression that is the subject matter of copyright and that relates to the Company’s business, products, or services, the Company shall be deemed the author of such work if the work is prepared by Consultant or Consultant’s Associates in the scope of his or their consultancy by virtue of the work being a work made for hire or, if the work was not prepared by Consultant or Consultant’s Associates within the scope of his or their employment or consultancy but was specially ordered by the Company as a contribution to a collective work, as a part of a motion picture or other audio-visual work, as a translation, as a supplementary work, as a compilation or as an instructional test, then the work shall be considered to be work made for hire and the Company shall be the author of the work. With regard to any other work of authorship fixed in any tangible medium of expression that is the subject matter of copyright and which relates specifically to the business, products or services of the Company, Consultant agrees to, and does hereby, assign to the Company all worldwide right, title and interest in and to such works.

Consultant agrees that Consultant and each of Consultant’s Associates will sign, execute and acknowledge, or cause to be signed, executed and acknowledged, at the expense of the Company, any and all documents, and will perform any and all acts, as may be necessary, useful or convenient for the purpose of securing to the Company or its nominee patent, trademark or copyright protection throughout the world upon all such Inventions. At the request of the Company, Consultant will have each of Consultant’s Associates with access to Confidential Information of the Company or who performs work pursuant to this Agreement to sign an agreement in form substantially identical to this Agreement.

6.     License Rights. In the event that Consultant recommends to the Company that the Company make use of devices and/or processes covered by patents and/or patent applications which Consultant may own or control, Consultant will then so inform the Company, and in the event that the Company shall follow Consultant’s recommendation and Consultant has the right to grant a license under such patents and/or patent applications, then Consultant will grant to the Company a license on reasonable terms which are no less favorable than those granted by Consultant to any other licensee.

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7.     Miscellaneous.

(a)     Effective Date. This Agreement shall be effective as of the date specified on Exhibit A hereto, the date of commencement of consulting services, and it is expressly agreed to by Consultant and the Company that all the provisions hereof shall apply as if this Agreement had been entered into on such date.

(b)     Survival of Terms. The provisions of paragraphs 4, 5 and 6 hereof shall survive termination of this Agreement.

(c)     Successors and Assigns. This Agreement may not be assigned by Consultant without the written consent of the Company. This Agreement shall be binding on all of Consultant’s Associates, all of Consultant’s heirs, executors, administrators and legal representatives, and all of Consultant’s successors in interest and assigns, and shall be for the benefit of the Company, its successors and its assigns.

(d)     Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Minnesota.

(e)     Severability. If one or more of the provisions in this Agreement are deemed void by law, then the remaining provisions will continue in full force and effect.

(f)     Amendment. Neither this Agreement nor the Description of Work may be amended except by a written agreement modifying the appropriate document duly executed by Consultant and an officer of the Company.

(g)     Entire Agreement. This Agreement, together with the Description of Work attached hereto, constitutes the sole and complete agreement of the parties with respect to the matters included herein, and supersedes any previous oral or written agreement, if any, relating to the subject matters included herein.

(h)     No Conflict. Consultant represents and warrants that this Agreement does not conflict with any other agreement or term of employment applicable to or binding upon the Consultant as of the date hereof and that Consultant will promptly notify the Company in the event that any such conflict does arise during the term hereof.

(i)     Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument.

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This Agreement is executed on the date set forth below, and shall be effective as of the date specified.

CONSULTANT:	COMPANY:
	SUN BIOPHARMA, INC.
/s/ David Kaysen	/s/ Michael Cullen
Name: David Kaysen Individually	Michael Cullen Executive Chairman, President & CEO
Date: October 31, 2018	Date: October 31, 2018

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EXHIBIT A

DESCRIPTION OF WORK

START DATE: October 31, 2018

COMPLETION DATE: October 31, 2020

PERSON(S) WHO ARE TO PERFORM THE WORK: David Kaysen

AUTHORIZED REPRESENTATIVE OF THE COMPANY: Michael Cullen

DETAILED DESCRIPTION OF WORK: Consultant shall provide the following services to the Company: Miscellaneous issues and questions regarding governance, compliance and fundraising.

PAYMENT: As compensation for the Services granted by Consultant to the Company pursuant to this Agreement, the Company shall pay Consultant:

(a)   CEO and Consultant will agree to specific fees based on specific work projects on a project by project basis.

EXPENSES: The Company agrees to reimburse Consultant for the following reasonable and customary business expenses:

	Yes	No
Routine out of pocket expenses		X
Local travel		X
Long Distance travel, lodging and meals at the direction of the Chief Executive Officer	X
Other – as approved in advance	X

if Consultant receives written consent from an authorized agent of the Company prior to incurring such expenses. Each month, Consultant shall submit to the Company a written invoice for expenses incurred during such month.

EX-99.1

Exhibit 99.1

Sun BioPharma, Inc. Announces Leadership Changes

● David B. Kaysen Steps Down as President, CEO and Board Member Effective October 31, 2018

● Michael T. Cullen MD, MBA, Executive Chairman, Elected President and CEO by Board of Directors Effective October 31, 2018

MINNEAPOLIS, MN, October 31, 2018 (GLOBE NEWSWIRE) – Sun BioPharma, Inc. (OTCQB:SNBP), a clinical stage biopharmaceutical company developing disruptive therapeutics for the treatment of pancreatic diseases, today announces leadership changes in the organization.

Effective October 31, 2018, David B. Kaysen is stepping down as President, CEO and Board member of Sun BioPharma, Inc. and its wholly owned subsidiary, Sun BioPharma Australia Pty Ltd. Also, effective October 31, 2018, Michael T. Cullen, MD, MBA, the company’s Executive Chairman, has accepted the additional responsibilities of President and CEO of Sun BioPharma, Inc. and its wholly owned subsidiary, Sun BioPharma Australia Pty Ltd.

These changes are a result of the need for cost reductions to focus further spending on the current Phase 1a/1b clinical trial in the front-line combination study of SBP-101 with gemcitabine and nab-paclitaxel for the treatment of metastatic pancreatic cancer. Mr. Kaysen departs in good standing with the Company and has agreed to act as a consultant to Sun Bio Pharma to provide advice and continuity on various matters.

“We appreciate Dave’s efforts to move Sun BioPharma forward in our quest to get SBP-101 into the clinic in order to have a positive impact on patients with pancreatic ductal adenocarcinoma (PDA)” said Michael Cullen, MD, MBA the company’s Chairman, President and CEO. “And wish him the best in his future endeavors.”

“It has been my honor and privilege to be a part of Sun BioPharma and the significant progress the company has made since the early fall of 2015” said Kaysen. “I wish much success moving forward to the incredibly qualified team leading this organization.”

About SBP-101

SBP-101 is a first-in-class, proprietary, polyamine compound designed to exert therapeutic effects in a mechanism specific to the pancreas. Sun BioPharma originally licensed SBP-101 from the University of Florida Research Foundation in 2011. The molecule has been shown to be highly effective in preclinical studies of human pancreatic cancer models, demonstrating superior activity to existing FDA-approved chemotherapy agents. Combination therapy potential has also been shown for pancreatic cancer. SBP-101 is expected to differ from current pancreatic cancer therapies in that it specifically targets the exocrine pancreas and has shown efficacy against primary and metastatic disease in animal models of human pancreatic cancer. Therefore, management believes that SBP-101 may effectively treat both primary and metastatic pancreatic cancer, while leaving the insulin-producing islet cells and non-pancreatic tissue unharmed. The safety and metabolic profile demonstrated in our first-in-human safety study further supports evaluation of the potential for additive or synergistic effects in combination with current standard pancreatic cancer treatment.

About Sun BioPharma

Sun BioPharma Inc. is a clinical-stage biopharmaceutical company developing disruptive therapeutics for urgent unmet medical needs. The Company’s development programs target diseases of the pancreas, including pancreatic cancer and pancreatitis; the Company’s initial product candidate is SBP-101 for the treatment of patients with pancreatic cancer. SBP-101 was invented by Raymond Bergeron, Ph.D., a Distinguished Professor Emeritus at the University of Florida. Sun BioPharma has scientific collaborations with pancreatic disease experts at Cedars Sinai Medical Center in Los Angeles, the University of Miami, the University of Florida, the Mayo Clinic Scottsdale, the Austin Health Cancer Trials Centre in Melbourne, Australia, the Ashford Cancer Centre in Adelaide, Australia and The Blacktown Cancer and Haemotology Centre in Sydney, Australia. The Company’s independent Data Safety Monitoring Board (DSMB) is Chaired by James Abbruzzese, MD, Professor of Medicine, Charles Johnson, M.D. Professor of Medicine, a member of the Duke Cancer Institute and Chief, Division of Medical Oncology at Duke University School of Medicine. Professor David Goldstein, FRACP, Senior Staff Specialist at the Prince Henry & Prince of Wales Hospital / Cancer Care Centre in Sydney, Australia is Co-Chair of the DSMB. Further information can be found at: www.sunbiopharma.com. Sun BioPharma’s common stock is currently quoted on the OTCQB tier of the over-the-counter markets administered by the OTC Markets Group, Inc. under the symbol: SNBP.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. For example, statements regarding the Company’s next study, the timing and effects of the reverse stock split and potential eligibility and approval for listing on a national securities exchange are forward-looking statements. Any other statements that are not historical fact (including, but not limited to statements that contain words such as “will”, “believes,” “may,” “anticipates,” “expects,” “estimates” or “plans”) should also be considered to be forward-looking statements. Forward-looking statements are not a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time the statements are made and involve known and unknown risks, uncertainties and other factors that may cause our results, levels of activity, performance or achievements to be materially different from the information expressed or implied by such forward-looking statements, including, without limitation, the anticipated timing of first patient enrollment, our need to obtain additional capital, which may not be available on acceptable terms or at all, risks inherent in the development and/or commercialization of potential products, uncertainty in the results or timing of clinical trials or regulatory approvals, timing of necessary regulatory processes relating to the reverse stock split, and other material changes in our business that could jeopardize our ability to qualify for listing on a national securities exchange. Actual results may differ materially from the results anticipated in these forward-looking statements and as such should be evaluated together with the many uncertainties that affect the Company and its business, particularly those disclosed from time to time in its filings with the Securities and Exchange Commission. Stockholders and other readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made. The Company disclaims any intent or obligation to update these forward-looking statements.

Contact Information:

Investor & Media Contact:

Susan Horvath – Sun BioPharma, Inc.

952 479 1196