Subsequent events |
9 Months Ended |
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Sep. 30, 2023 | |
Subsequent events. | |
Subsequent events | 11. Subsequent events The Merger with Morphimmune
On October 2, 2023 the Company closed the Merger transaction contemplated by the Merger Agreement. As a result of the Merger, the Company acquired 100% of the outstanding equity interests of Morphimmune through the issuance of 8,835,710 shares of the Company’s common stock to Morphimmune stockholders, based upon an exchange ratio of 0.3042 shares of the Company’s common stock for each outstanding share of Morphimmune capital stock.
Upon completion of the Merger, 8,128,096 options to purchase shares of Morphimmune capital stock were converted into 2,472,567 options to purchase shares of the Company’s common stock with a weighted average exercise price of $1.29 per share. All other terms and conditions associated with these options, including vesting and exercisability are governed by the original terms and conditions of Morphimmune’s legacy equity plan.
The Company will account for the acquisition of Morphimmune as an asset acquisition as substantially all of the fair value of the gross assets acquired of Morphimmune is concentrated within two programs that are considered a group of similar assets. These programs are deemed to be similar IPR&D assets being acquired based on the similarity of: (i) their current preclinical stage of development, (ii) solid tumor therapeutic indications, (iii) risks for development, (iv) regulatory pathway, and (v) economics of commercialization.
Under the asset acquisition method of accounting, the assets acquired and liabilities assumed are recognized and measured at fair value and no goodwill is recorded or recognized. Acquired IPR&D that has no future alternative use is expensed at the time of acquisition.
Sale of Common Stock
On June 28, 2023, in connection with the Merger Agreement, the Company entered into subscription agreements with certain investors pursuant to which the Company would sell shares of its common stock, immediately following the completion of the Merger, in exchange for gross proceeds of $125.0 million. Immediately following the completion of the Merger, the Company sold 21,690,871 shares of its common stock pursuant to the subscription agreements. The Company recognized net proceeds of $125.0 million from this PIPE transaction, $61.0 million of which was received on or prior to September 30, 2023 and recorded as a deposit liability in the accompanying condensed balance sheets as of September 30, 2023. The deposit liability was subsequently reclassified to stockholders’ equity upon completion of the sale of common stock in October 2023.
Termination of Chief Executive Officer
In accordance with the terms of the Merger Agreement, the Company’s CEO resigned as a board member, officer and employee of the Company. Upon termination, 162,083 options immediately vested and the related unamortized stock-based compensation expense was immediately recognized. In addition, the CEO was eligible to receive approximately $1.0 million in termination benefits comprised of salary, bonus and related benefits and were recognized at the time of termination.
Stock Options Granted for New Chief Executive Officer
On June 28, 2023 and contingent upon completion of the Merger, the Company entered into an employment agreement with Dr. Clay Siegall, the President and CEO of Morphimmune, whereby Dr. Siegall was granted 2,137,080 options to purchase shares of the Company’s common stock at an initial exercise price of $5.91 per share. The options vest over time during Dr. Siegall’s continued employment, which commenced on October 2, 2023, in connection with the closing of the Merger, to which 25% of the options granted will vest after one year of employment with Immunome and the remaining 75% of the options granted will vest monthly over the remaining 36 months following the one year anniversary, subject to acceleration in certain circumstances. The estimated grant date fair value of Dr. Siegall’s award was $9.6 million or $4.49 per share.
New Lease Agreement In October 2023, the Company entered into a lease in Bothell, Washington. The lease has a five-year term.
Board of Directors Stock Options Exercise Period Extension In October 2023, the stock options held by directors who resigned in connection with the Merger were amended so that: (a) the post-termination exercise period was extended to one year and (b) the vesting of all unvested shares was accelerated.
Open Market Sale Agreement, or the ATM Agreement On November 8, 2023, the Company provided notice of termination of the ATM Agreement to Jefferies. |