Heat Biologics, Inc. (NASDAQ:HTBX) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01.Entry into a Material Definitive Agreement.

The Acquisition

As previously reported by Heat Biologics, Inc. (Heat) in a
Current Report on Form 8-K filed by Heat with the Securities and
Exchange Commission (the SEC) on March 8, 2017 (the March 2017
Form 8-K), Heat entered into a Stock Purchase Agreement on March
7, 2017 (the Purchase Agreement) with Pelican Therapeutics, Inc.
(Pelican), a related party, and certain stockholders in Pelican
(the Initial Participating Pelican Stockholders) to purchase 80%
of the outstanding capital stock of Pelican on a fully diluted
basis (the Acquisition). On April 28, 2017, Heat closed the
Acquisition (the Closing) and additional Pelican stockholders
executed Joinders to the Purchase Agreement (the Additional
Participating Pelican Stockholders, together with the Initial
Participating Pelican Stockholders, collectively, the
Participating Pelican Stockholders). Each Participating Pelican
Stockholder exchanged approximately 84.7% of the shares of
Pelican common stock held by such Participating Pelican
Stockholder in exchange for a pro rata share of (i) an aggregate
of 1,331,056 shares (the Stock Consideration) of Heat restricted
common stock, $0.0002 par value per share (the Common Stock), and
(ii) aggregate cash consideration of $500,000 (the Cash
Consideration), all of which is being held in escrow for a period
of up to six (6) months to secure certain indemnification and
other obligations of Pelican and the Participating Pelican
Stockholders in connection with the Acquisition. In addition to
the payments described above, under the terms of the Purchase
Agreement, Heat agreed to cause Pelican to make cash payments to
the Participating Pelican Stockholders upon the achievement of
certain clinical and commercialization milestones, as well as low
single digit royalty payments and payments upon receipt of
sublicensing income, all as described in more detail in the March
2017 Form 8-K. The Cash Consideration will be reduced by the
amount by which certain of Pelicans accrued liabilities are not
satisfied for less than $250,000. All but two security holders of
Pelican participated in the Acquisition.

The Purchase Agreement contains customary representations,
warranties and covenants of Heat, Pelican and the Participating
Pelican Stockholders. Subject to certain customary limitations,
the Participating Pelican Stockholders have agreed to indemnify
Heat and its officers and directors against certain losses
related to, among other things, breaches of Pelicans and the
Participating Pelican Stockholders representations and
warranties, certain specified liabilities and the failure to
perform covenants or obligations under the Purchase Agreement.

In connection with the Acquisition, Heat and the Participating
Pelican Stockholders entered into a Stockholders Agreement (the
Stockholders Agreement) with respect to the Pelican common stock
retained by the Participating Pelican Stockholders (the Retained
Shares). The Stockholders Agreement, contains restrictions on
transfer of the Retained Shares and drag-along rights in the
event of a consolidation or merger of Pelican with another entity
after the date of the Purchase Agreement or the sale of all or
substantially all of Pelicans assets or a transaction in which at
least fifty percent (50%) of the voting rights attached to the
Pelican securities are sold. In addition, Participating Pelican
Stockholders will have co-sale rights in connection with Heats
transfer of the Pelican Shares that Heat owns.

The foregoing summaries of the Purchase Agreement and the
Stockholders Agreement do not purport to be complete and are
qualified in their entirety by reference to the full texts of the
Purchase Agreement that is included as Exhibit10.1 to this
Current Report on Form 8-K and the Stockholders Agreement that is
filed as an exhibit thereto.

The representations, warranties and covenants contained in the
Purchase Agreement were made only for purposes of such agreement
and as of specific dates, were solely for the benefit of the
parties to the Purchase Agreement, and may be subject to
limitations agreed upon by the contracting parties. Accordingly,
the Purchase Agreement is incorporated herein by reference only
to provide investors with information regarding the terms of the
Purchase Agreement, and not to provide investors with any other
factual information regarding Heat, Pelican or either of their
businesses, and should be read in conjunction with the
disclosures in Heats periodic reports and other filings with the
SEC.

About Pelican

Pelican is a biotechnology company focused on the development and
commercialization of monoclonal antibody and fusion protein-based
therapies that are designed to activate the immune system. Under
the Purchase Agreement, it was a condition to closing that
holders of at least 80% of the outstanding capital stock of
Pelican on a fully diluted basis participate in the Acquisition
and that Pelican deliver to Heat a fully executed agreement with
the Cancer Prevention and Research Institute of Texas (CPRIT),
with respect to the $15.2 million CPRIT grant that had been
awarded to Pelican to fund preclinical and some clinical
activities from CPRIT. Under license agreements with the
University of Miami, Pelican has obtained exclusive rights to
five different patent families each directed to therapeutic
compositions and methods related to targeting TNFRSF25/TL1A for
the purpose of modulating immune responses described in more
detail in the March 2017 Form 8-K.

Rahul Jasuja, Ph.D., a member of the Pelican Board of Directors
and a Pelican stockholder, was appointed to serve as the Chief
Executive Officer of Pelican on April 3, 2017.

Item2.01.Completion of Acquisition or Disposition of
Assets.

As disclosed in Item1.01 of this Current Report on Form 8-K, on
April 28, 2017, Heat completed the Acquisition of approximately
80% of the outstanding capital stock of Pelican on a fully
diluted basis to the Purchase Agreement. The information set
forth in Item1.01 of this Current Report on Form 8-K is
incorporated herein by reference into this Item2.01 in its
entirety.

Jeff Wolf, Heats President, Chief Executive Officer and Chairman
of the board of directors, and two entities controlled by him,
Edward Smith, a member of Heats board of directors, and an entity
controlled by Mr. Smith, Taylor Schreiber, M.D., Ph.D., the
Chairman of Heats Scientific Advisory Board and an entity
controlled by him, and Dr. Jasuja are Participating Pelican
Stockholders, each of which sold approximately 84.7% of their
shares of capital stock of Pelican in order to meet the 80%
closing condition, on the same terms as the other Participating
Pelican Stockholders. A limited liability company (the LLC) of
which Mr. Wolf was the managing member owned 61.1% of the
outstanding capital stock of Pelican agreed to sell approximately
84.7% of its shares of capital stock of Pelican in order to meet
the 80% closing condition, on the same terms as the other
Participating Pelican Stockholders. Mr. Wolf, Mr. Smith, Dr.
Schreiber and John Monahan, Ph.D., a member of the board of
directors of Heat, directly and/or entities they controlled were
members of the LLC. The LLC liquidated concurrently with the
Closing and distributed to its members the right to receive the
Cash Consideration and Stock Consideration being held in escrow
for six months to the terms of the Purchase Agreement. Subject to
the escrow, Mr. Wolf and entities he controls will receive a pro
rata share of the Cash Consideration and an aggregate of 271,752
shares of Stock Consideration (inclusive of shares received upon
liquidation of the LLC). In addition, subject to the escrow, a
trust for the benefit of Mr. Wolfs children (for which Mr. Wolf
does not serve as the trustee) will receive a pro rata share of
the Cash Consideration and an aggregate of 177,729 shares of
Stock Consideration (inclusive of shares received upon
liquidation of the LLC). Subject to the escrow, Mr. Smith and an
entity he controls will receive a pro rata share of the Cash
Consideration and an aggregate of 345,753 shares of Stock
Consideration (inclusive of shares received upon liquidation of
the LLC). Subject to the escrow, Dr. Schreiber and an entity he
controls will receive a pro rata share of the Cash Consideration
and an aggregate of 44,443 shares of Stock Consideration
(inclusive of shares received upon liquidation of the LLC).
Subject to the escrow, Dr. Jasuja will receive a pro rata share
of the Cash Consideration and an aggregate of 9,854 shares of
Stock Consideration (inclusive of shares received upon
liquidation of the LLC). Subject to the escrow, Dr. Monahan will
receive a pro rata share of the Cash Consideration and an
aggregate of 3,958 shares of Stock Consideration (inclusive of
shares received upon liquidation of the LLC).

Item3.02.Unregistered Sales of Equity
Securities.

The information set forth in Item1.01 of this Current Report on
Form 8-K is incorporated herein by reference into this Item3.02
in its entirety. The Stock Consideration was offered and sold to
the Participating Pelican Stockholders on April 28, 2017 in a
transaction exempt from registration under the Securities Act of
1933, as amended (the Securities Act), in reliance on
Section4(a)(2) thereof and Rule 506 of Regulation D thereunder.
Each of the Participating Pelican Stockholders represented that
such stockholder was an accredited investor, as defined in
Regulation D, and was acquiring the Stock Consideration for
investment only and not with a view towards, or for resale in
connection with, the public sale or distribution thereof.
Accordingly, the Stock Consideration has not been registered
under the Securities Act and the Stock Consideration may not be
offered or sold in the United States absent registration or an
exemption from registration under the Securities Act and any
applicable state securities laws. Neither this Current Report on
Form 8-K nor the exhibits attached hereto is an offer to sell or
the solicitation of an offer to buy shares of Common Stock or any
other securities of Heat.

Item 8.01.Other Events.

On May 1, 2017, Heat issued the press release attached hereto as
Exhibit 99.1 announcing the closing of the Acquisition and that
Dr. Jasuja was appointed to serve as the Chief Executive Officer
of Pelican.

Item 9.01.Financial Statements and Exhibits.

The financial statements required by Item9.01(a) of Form 8-K will
be filed with the SEC no later than 71 calendar days after the
date that this Current Report on Form 8-K is required to be
filed.

The pro forma financial information required by Item9.01(b) of
Form 8-K will be filed with the Securities and Exchange
Commission no later than 71 calendar days after the date that
this Current Report on Form 8-K is required to be filed.

* Certain information in this exhibit has been omitted and filed
separately with the Securities and Exchange Commission to a
Confidential Treatment Request submitted to the Securities and
Exchange Commission to Rule24b-2 under the Securities Exchange
Act of 1934, as amended.

About Heat Biologics, Inc. (NASDAQ:HTBX)

Heat Biologics, Inc. is a development-stage company focused on developing allogeneic, off-the-shelf cellular therapeutic vaccines to combat a range of cancers. The Company is an immuno-oncology company, which focuses on T cell-stimulating platform technologies, such as Immune Pan-Antigen Cytotoxic Therapy (ImPACT) and Combination Pan-Antigen Cytotoxic Therapy (ComPACT). Using its ImPACT platform technology, the Company has developed HS-410 (vesigenurtacel-L) as a product candidate to treat non-muscle invasive bladder cancer (NMIBC), and HS-110 (viagenpumatucel-L), which is intended for use in combination with an anti-PD-1 checkpoint inhibitor, as a potential treatment for patients with non-small cell lung cancer (NSCLC). Using its ComPACT platform technology, it has developed HS-120 as a potential treatment for NSCLC. It is conducting a Phase II trial of HS-410 in patients with NMIBC, and a Phase Ib trial of HS-110, in combination with nivolumab (Opdivo) to treat patients with NSCLC.

Heat Biologics, Inc. (NASDAQ:HTBX) Recent Trading Information

Heat Biologics, Inc. (NASDAQ:HTBX) closed its last trading session up +0.003 at 0.755 with 168,156 shares trading hands.