AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO) Files An 8-K Entry into a Material Definitive AgreementItem 1.01
On December26, 2017, AVEO Pharmaceuticals, Inc. (“AVEO” or “we”) entered into a binding Memorandum of Understanding (the “MOU”) with class representatives Bob Levine and William Windham (the “Plaintiffs”), regarding the settlement of a securities class action lawsuit (the “ClassAction”) filed in 2013 and pending in the United States District Court for the District of Massachusetts (the “Court”) against us and certain of our former officers (Tuan Ha-Ngoc, David Johnston, and William Slichenmyer, together, the “Individual Defendants”), In re AVEO Pharmaceuticals, Inc. Securities Litigation et al., No. 1:13-cv-11157-DJC. As previously disclosed, the ClassAction was purportedly brought on behalf of shareholders who purchased our common stock between May16, 2012 and May1, 2013 (the “Class”).
Under the terms of the MOU, which outlines certain elements of the settlement, we have agreed with counsel for the Plaintiffs to cause certain of our and the Individual Defendants’ insurance carriers to provide the Classwith a cash payment of $15,000,000, which includes the cash amount of any attorneys’ fees or litigation expenses that the Court may award Plaintiffs’ counsel and costs Plaintiffs’ incur in administering and providing notice of the settlement. Additionally, we agreed to issue to the Classwarrants for the purchase of 2,000,000 shares of AVEO common stock exercisable from the date of issue until the expiration of a one-year period after the date of issue at an exercise price equal to the closing price on December22, 2017, the trading day prior to the execution of the MOU, which was $3.00. In consideration of this settlement payment, Plaintiffs have agreed that the settlement will include a dismissal of the ClassAction with prejudice and a release of all claims against the Company and the Individual Defendants (the “Release”) by the Class.
The settlement is subject to the execution of a definitive settlement agreement, notice to the Class, and final approval of the Court and shall be effective on the date (the “Effective Date”) on which all of the following circumstances have occurred: (a)a final judgment containing the Release has been entered by the Court (“Final Judgment”); (b) no appeal is pending with respect to the Final Judgment; (c)the Final Judgment has not been reversed, modified, vacated or amended; (d)the time to file any appeal from the Final Judgment has expired without the filing of an appeal or an order dismissing the appeal or affirming the Final Judgment has been entered, and any time to file a further appeal (including a writ of certiorari or for reconsideration of the appeal) has expired; and (e)the MOU and any settlement agreement with respect to the claims released in the Final Judgment have not expired or been terminated.
We have agreed to use our best efforts to issue and deliver the warrants within ten business days following the Effective Date. We anticipate that the warrants, when issued to the settlement, will be exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”) to Section3(a)(10) of the Securities Act.
The MOU contains no admission of wrongdoing. AVEO and the Individual Defendants have always maintained and continue to believe that they did not engage in any wrongdoing or otherwise commit any violation of federal or state securities laws or other laws. However, given the potential cost and burden of continued litigation, we believe the settlement is in our best interests and the best interests of our stockholders.
The foregoing summary of the Memorandum of Understanding is qualified in its entirety by the full text of the Memorandum of Understanding, which is attached hereto as Exhibit 10.1 and is hereby incorporated by reference into this Item 1.01.
| Item 1.01 | Unregistered Sales of Equity Securities. |
The information contained above in Item 1.01 is hereby incorporated by reference into this Item 1.01.
| Item 1.01. | Financial Statements and Exhibits. |
(d) Exhibits
AVEO PHARMACEUTICALS INC ExhibitEX-10.1 2 d515675dex101.htm EX-10.1 EX-10.1 Exhibit 10.1 UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS In re AVEO Pharmaceuticals,…To view the full exhibit click here
About AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO)
AVEO Pharmaceuticals, Inc. is a biopharmaceutical company. The Company’s platform delivers insights into cancer and related disease. The Company’s product candidates include Tivozanib, Ficlatuzumab, AV-203 and AV-380. Tivozanib is a selective long half-life vascular endothelial growth factor tyrosine kinase inhibitor (VEGF TKI) that inhibits over three VEGF receptors. Tivozanib is designed to optimize VEGF blockade while minimizing off-target toxicities. Ficlatuzumab is a Hepatocyte Growth Factor (HGF) inhibitory antibody. AV-203 is an anti-ErbB3 monoclonal antibody with ErbB3 affinity. Its preclinical studies suggest that neuregulin1 (NRG1) levels predict AV-203 antitumor activity in preclinical models. AV-380 is a humanized Immunoglobulin G 1 (IgG1) inhibitory monoclonal antibody. AV-380 targets growth differentiating factor 15 (GDF15).
