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): February 25, 2015
SUNESIS PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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000-51531 |
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94-3295878 |
(State or other jurisdiction
of incorporation) |
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(Commission
File Number) |
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(IRS Employer
Identification No.) |
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395 Oyster Point Boulevard, Suite 400
South San Francisco, California |
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94080 |
(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code: (650) 266-3500
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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. |
Entry into a Material Definitive Agreement. |
On February 27, 2015, we entered into
a third amendment, or the Amendment, to the loan and security agreement dated October 18, 2011, or the Loan Agreement, with Oxford Finance LLC, Silicon Valley Bank and Horizon Technology Finance Corporation, or, collectively, the Lenders, to
amend certain terms of the Loan Agreement.
The Amendment modifies the loan repayment terms to be interest-only through February 2016,
followed by eight (8) equal monthly payments of principal and interest through the new maturity date of October 1, 2016. In addition, the final payment will be revised to 4.65% of the $25 million total loan facility and will be due on the
new maturity date, or such earlier date specified in the Loan Agreement. If we repay all or a portion of the loan prior to February 29, 2016 as part of a refinancing with another lender, a prepayment fee equal to 2% of the then outstanding
principal balance will be due to the Lenders.
As a result of the Amendment, we issued the Lenders warrants that are initially exercisable
for an aggregate of 61,467 shares of our common stock at a per share exercise price of $2.22. The warrants may be exercised on a cashless basis in whole or in part and will terminate on the earlier of the fifth anniversary of issuance or the closing
of certain events.
The descriptions of the Amendment and the warrants contained herein do not purport to be complete and are qualified in
their entirety by reference to the Amendment, a copy of which is attached hereto as Exhibit 10.1, and is incorporated by reference herein.
Item 5.02 |
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
2015 Compensation
On
February 25, 2015, the Compensation Committee of our Board of Directors, or the Committee, approved a merit increase to the base salaries of our named executive officers. Effective as of February 16, 2015, the base salaries for our named
executive officers will be as follows:
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Named Executive Officer |
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2015 Base Salary |
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Daniel N. Swisher, Jr.
President and Chief Executive Officer |
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500,000 |
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Eric H. Bjerkholt
Executive Vice President, Corporate Development and Finance, Chief Financial Officer and Corporate Secretary |
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400,000 |
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Adam R. Craig
Executive Vice President, Development and Chief Medical Officer |
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431,000 |
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2014 Bonus Awards
On February 25, 2015, the Committee approved the payment of cash bonuses to certain of our employees, including our named executive
officers, pursuant to our 2014 Bonus Program, as previously described in our Current Report on Form 8-K filed with the Securities and Exchange Commission on March 24, 2014.
Under the 2014 Bonus Program, each participant was eligible to receive a cash bonus in an amount
up to a specified target percentage of such participants annual base salary for 2014 based on the level of achievement of certain corporate and individual objectives. The bonus payment amounts approved by the Committee were based on its
determination of the degree to which such corporate and individual objectives were achieved.
A portion of the bonuses awarded to Messrs.
Swisher and Bjerkholt and Dr. Craig will consist of fully vested shares of our common stock granted under our 2011 Equity Incentive Plan, or the 2011 Plan. The bonus payment amounts for each of our named executive officers and the portion
thereof to be paid in cash and shares of our common stock are as follows:
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Named Executive Officer |
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Total Bonus Amount |
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Cash Bonus Amount |
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Stock Award Amount |
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Daniel N. Swisher, Jr.
President and Chief Executive Officer |
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$ |
202,000.00 |
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$ |
134,666.67 |
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$ |
67,333.33 |
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Eric H. Bjerkholt
Executive Vice President, Corporate Development and Finance, Chief Financial Officer and Corporate Secretary |
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117,500.00 |
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78,333.33 |
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39,166.67 |
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Adam R. Craig
Executive Vice President, Development and Chief Medical Officer |
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126,750.00 |
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84,500.00 |
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42,250.00 |
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The stock portion of the bonus awards were granted effective as of February 27, 2015 and the cash portion
of the bonus awards will be paid on March 13, 2015. The number of shares of our common stock awarded to Messrs. Swisher and Bjerkholt and Dr. Craig under the 2011 Plan were determined based on the closing price of our common stock as
quoted on the NASDAQ Capital Market on February 27, 2015, rounded down to the nearest whole share.
Restricted Stock Awards
On February 25, 2015, the Committee approved the grant of restricted stock awards, or RSAs, to certain of our employees, including our
named executive officers, under the 2011 Plan.
The following table sets forth the number of shares issuable upon vesting of each RSA for
each named executive officer:
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Named Executive Officer |
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Number of RSAs |
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Daniel N. Swisher, Jr.
President and Chief Executive Officer |
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60,000 |
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Eric H. Bjerkholt
Executive Vice President, Corporate Development and Finance, Chief Financial Officer and Corporate Secretary |
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32,500 |
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Adam R. Craig
Executive Vice President, Development and Chief Medical Officer |
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65,000 |
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The RSAs to Messrs. Swisher and Bjerkholt, and with respect to 32,500 RSAs to Dr. Craig, were granted on
February 27, 2015, and will vest, if at all, upon achievement by the Company of the earlier of (a) acceptance of a New Drug Application for vosaroxin by the U.S. Food and Drug Administration, or (b) approval of a Marketing
Authorization Plan for vosaroxin by the European Medicines Agency, each subject to determination by the Committee of achievement of such milestone and the named executive officer providing services to us as of such determination date.
With respect to 32,500 RSAs granted to Dr. Craig on February 27, 2015, such RSAs will
vest, if at all, upon achievement by the Company of the earlier of (a) approval of a New Drug Application for vosaroxin by the U.S. Food and Drug Administration, or (b) approval of a Marketing Authorization Plan for vosaroxin by the
European Medicines Agency, each subject to determination by the Committee of achievement of such milestone and Dr. Craig providing services to us as of such determination date.
Item 9.01. |
Financial Statements and Exhibits. |
(d) Exhibits.
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Exhibit
Number |
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Description |
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10.1 |
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Third Amendment to Loan and Security Agreement, dated October 18, 2011, among Sunesis Pharmaceuticals, Inc., Oxford Finance LLC, Silicon Valley Bank and Horizon Technology Finance Corporation, dated as of February 27,
2015. |
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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SUNESIS PHARMACEUTICALS, INC. |
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Dated: March 2, 2015 |
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By: |
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/s/ Eric H. Bjerkholt |
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Eric H. Bjerkholt |
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Executive Vice President, Corporate Development and Finance, Chief Financial Officer and Corporate Secretary |
Item 9.01. |
Financial Statements and Exhibits. |
(d) Exhibits.
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Exhibit
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Description |
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10.1 |
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Third Amendment to Loan and Security Agreement, dated October 18, 2011, among Sunesis Pharmaceuticals, Inc., Oxford Finance LLC, Silicon Valley Bank and Horizon Technology Finance Corporation, dated as of February 27,
2015. |
Exhibit 10.1
THIRD AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT to LOAN AND SECURITY AGREEMENT (this Amendment) is entered into as of February 27, 2015, by and
among OXFORD FINANCE LLC, a Delaware limited liability company with an office located at 133 North Fairfax Street, Alexandria, Virginia 22314 (Oxford), as collateral agent (in such capacity, the Collateral
Agent), the Lenders listed on Schedule 1.1 thereof or otherwise a party hereto from time to time including Oxford in its capacity as a Lender, SILICON VALLEY BANK, a California corporation with an office located at 3003 Tasman
Drive, Santa Clara, California 95054 (SVB) and HORIZON FUNDING TRUST 2013-1, a Delaware statutory trust, as assignee of HORIZON TECHNOLOGY FINANCE CORPORATION, a Delaware corporation, with an office located at 312 Farmington
Avenue, Farmington, Connecticut 06032 (HRZN; together with Oxford and SVB, each a Lender and collectively, the Lenders), and SUNESIS PHARMACEUTICALS, INC., a Delaware corporation with offices
located at 395 Oyster Point Boulevard, Suite 400, South San Francisco, California 94080 (Borrower).
RECITALS
A. Collateral Agent, Borrower and the Lenders have entered into that certain Loan and Security Agreement dated as of October 18,
2011 (as the same may from time to time be amended, modified, supplemented or restated, including but without limitation by that certain First Amendment to Loan and Security Agreement dated as of March 29, 2012 and that certain Second Amendment
to Loan and Security Agreement dated as of September 23, 2013, the Loan Agreement).
B. The Lenders
extended credit to Borrower for the purposes permitted in the Loan Agreement.
C. Borrower has requested that Collateral Agent and
the Lenders make certain revisions to the Loan Agreement as more fully set forth herein.
D. Collateral Agent and the Lenders have
agreed to so amend certain provisions of the Loan Agreement, but only to the extent, in accordance with the terms, subject to the conditions and in reliance upon the representations and warranties set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:
1.
Definitions. Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the Loan Agreement.
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2. |
Amendments to Loan Agreement. |
2.1 Section 2.2 (Term Loans).
Sections 2.2(b) of the Loan Agreement hereby is amended and restated as follows:
(b) Repayment. Borrower shall make monthly
payments of interest only commencing on the first (1st) Payment Date following the Funding Date of each Term Loan, and continuing on the Payment Date of each successive month thereafter through and including the Payment Date immediately
preceding the Amortization Date. Commencing on the Amortization Date, and continuing on the Payment Date of each month thereafter, Borrower shall make consecutive equal monthly payments of principal and interest, in arrears, to each Lender, as
calculated by Collateral Agent (which calculations shall be deemed correct absent manifest error) based upon: (1) the amount of such Lenders Term Loans, (2) the effective rate of interest, as determined in Section 2.3(a), and
(3) a repayment schedule equal to thirty-two (32) months; provided, however, Borrowers Term Loan principal
payments due for the period March 1, 2015 through February 1, 2016 (collectively, the Deferred Principal Payment) shall be deferred until March 1, 2016 (the
Deferral Date) and then beginning on the Deferral Date, unless earlier satisfied in full, the outstanding balance of the Term Loans, including the Deferred Principal Payment, shall re-amortize and beginning on the first Business
Day following the Deferral Date and continuing on the Payment Date of each month thereafter, Borrower shall make consecutive equal monthly payments of principal and interest, in arrears, to each Lender, as calculated by Collateral Agent (which
calculations shall be deemed correct absent manifest error) based upon: (1) the amount of such Lenders Term Loans, (2) the effective rate of interest, as determined in Section 2.3(a), and (3) a repayment schedule equal to
eight (8) months. All unpaid principal, the Final Payment, and accrued and unpaid interest with respect to the Term Loans, is due and payable in full on the Maturity Date. The Term Loans may only be prepaid in accordance with Sections 2.2(c)
and 2.2(d).
2.2 Section 14 (Definitions). Effective from and after the Third Amendment Effective Date, the following
terms and their definitions set forth in Section 14.1 of the Loan Agreement hereby are added or amended in their entirety and/or replaced with the following:
Deferred Principal Payment is defined in Section 2.2(b).
Deferral Date is defined in Section 2.2(b).
Final Payment Percentage is four and sixty-five hundredths percent (4.65%).
Maturity Date is October 1, 2016.
Prepayment Fee means with respect to any Term Loan subject to prepayment prior to the Maturity Date, whether by mandatory
or voluntary prepayment, acceleration or otherwise, an additional fee payable to the Lenders in amount equal to:
(i) for a prepayment
made on or after the Third Amendment Effective Date through February 29, 2016, two percent (2.00%) of the principal amount of such Term Loan prepaid; and
(ii) for a prepayment made after February 29, 2016 and prior to the Maturity Date, no Prepayment Fee shall be applicable.
Notwithstanding the foregoing, the Prepayment Fee shall only be payable if the Term Loans are wholly refinanced with another lender, other
than Oxford, SVB and HRZN, collectively.
Third Amendment Effective Date means February 27, 2015.
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3. |
Limitation of Amendments. |
3.1 The amendments set forth in Section 2,
above, are effective for the purposes set forth herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or
(b) otherwise prejudice any right or remedy which Collateral Agent may now have or may have in the future under or in connection with any Loan Document.
3.2 This Amendment shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations,
warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect.
4. Representations and Warranties. To induce Collateral Agent and the Lenders to enter into this Amendment, Borrower hereby represents
and warrants to Collateral Agent as follows:
4.1 Immediately after giving effect to this Amendment, (a) the representations
and warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and
correct as of such date), and (b) no Event of Default has occurred and is continuing;
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4.2 Borrower has the power and authority to execute and deliver this Amendment and to
perform its obligations under the Loan Agreement, as amended by this Amendment;
4.3 The organizational documents of Borrower
delivered to Collateral Agent in connection with the execution of the Loan Agreement remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;
4.4 The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, have been duly authorized;
4.5 The execution and delivery by Borrower of this Amendment
and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, do not and will not contravene (a) any law or regulation binding on or affecting Borrower, (b) any contractual restriction with a
Person binding on Borrower, (c) any order, judgment or decree of any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational documents of Borrower;
4.6 The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision
thereof, binding on either Borrower, except as already has been obtained or made; and
4.7 This Amendment has been duly executed
and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or other
similar laws of general application and equitable principles relating to or affecting creditors rights.
5. Counterparts.
This Amendment may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument.
6. Effectiveness. This Amendment shall be deemed effective upon (a) the due execution and delivery to Collateral Agent of this
Amendment, by each party hereto; (b) issuance by Borrower to and receipt by each Lender of a Warrant to Purchase Stock in form and content reasonably acceptable to each Lender; and (c) payment by Borrower of all unpaid Lender Expenses
incurred to date, which may be debited from any of Borrowers accounts.
[Balance of Page Intentionally Left
Blank]
3
IN WITNESS WHEREOF, the parties hereto have
caused this Amendment to be duly executed and delivered as of the date first written above.
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BORROWER: |
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SUNESIS PHARMACEUTICALS, INC. |
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By |
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/s/ Eric Bjerkholt |
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Name: |
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Eric Bjerkholt |
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Title: |
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EVP Corp Dev and Finance, CFO |
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COLLATERAL AGENT AND LENDER: |
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OXFORD FINANCE LLC |
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By |
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/s/ Mark Davis |
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Name: |
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Mark Davis |
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Title: |
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Vice President Finance, Secretary & Treasurer |
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LENDER: |
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HORIZON FUNDING TRUST 2013-1 |
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By: HORIZON TECHNOLOGY FINANCE CORPORATION,
its agent |
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By |
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/s/ Robert D. Pomeroy, Jr. |
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Name: |
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Robert D. Pomeroy, Jr. |
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Title: |
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Chief Executive Officer |
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LENDER: |
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SILICON VALLEY BANK |
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By |
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/s/ Milo Bissin |
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Name: |
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Milo Bissin |
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Title: |
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Vice President |
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[Signature Page to Third Amendment to Loan and Security Agreement]
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