HOMOLOGY MEDICINES, INC. : Entering into a Material Definitive Agreement, Completion of Acquisition or Disposal of Assets, Financial Statements and Exhibits (Form 8-K)

Item 1.01. Conclusion of a significant definitive agreement.

At March 10, 2022in the context of the Transaction (as defined in point 2.01 below), Homology Medicines, Inc. (“Homology”) has entered into (i) a Contribution Agreement, (ii) an Amended and Restated Limited Liability Partnership Agreement (the “Newco Operating Agreement”), (iii) a Manufacturing and Supply, (iv) an Assignment and Assumption Agreement, and (v) a Sublease Agreement (collectively, the “Closing Agreements”). The material terms of the closing agreements are described in item 1.01 of the current report on Form 8-K filed by Homology on February 3, 2022 (the “Signing 8-K”), and are incorporated herein by reference.

Item 2.01. Completion of acquisition or disposal of assets.

At March 10, 2022Homology has completed the previously announced transaction with
Oxford Biomedica Solutions LLC (f/k/a Roadrunner Solutions LLC) (“Newco”),
Oxford Biomedica (USA), Inc. (“OXB”) and Oxford Biomedica plc (“OXB parent company” and, collectively with OXB, “Oxford”), pursuant to the equity purchase agreement (the “Purchase Agreement”), dated January 28, 2022by and between Homology, Newco and Oxford, whereby, among other things, Homology and Oxford have agreed to collaborate to operate Newco, which will provide adeno-associated virus (“AAV”) vector process development and manufacturing to the companies pharmaceutical and biotechnology companies (the “Transaction”).

Immediately prior to the closing of the transaction (the “Closing”), Homology and Newco entered into a Contribution Agreement (as previously disclosed in the signing 8-K), pursuant to which Homology assigned and transferred to Newco all assets of Homology that are primarily used in the manufacture of AAV vectors for use in gene therapy or gene editing products, but excluding certain assets related to the manufacture or testing of proprietary AAV vectors of Homology (collectively, the “Transferred Assets”), in exchange for 175,000 common shares in Newco (“Units”) and Newco assumed of Homology, and agreed to pay, perform and discharge upon maturity, of all of Homology’s duties, obligations, liabilities, interests and liabilities of any nature under, arising out of or relating to the Transferred Assets.

Effective from the Closing, Homology sold to OXB, and OXB purchased from Homology, 130,000 units (the “Transferred Units”) in exchange for
$130.0 million. As part of the Closing, OXB contributed $50.0 million in cash to Newco in exchange for an additional 50,000 Units. Immediately after closing, (i) OXB held 180,000 Units, representing 80% (80%) of the fully diluted equity interests in Newco, and (ii) Homology held 45,000 Units, representing 20% ​​(20%) of the fully diluted shares. interests in Newco. Pursuant to Newco’s operating agreement, at any time after the third anniversary of closing, Homology will have the option to require OXB to purchase from Homology, and OXB will have the option to require Homology to sell to OXB, in each case the entirety of Homology’s interest in Newco at a price equal to 5.5 times the turnover of the immediately preceding 12-month period, subject to a specified maximum amount.

The disposition of the Transferred Assets and Transferred Units constituted a disposition of a material amount of assets for purposes of Item 2.01 of Form 8-K. Accordingly, the pro forma financial information required by Section 9.01 is included in Exhibit 99.1 to this current report on Form 8-K.

Homology intends to file copies of the Purchase Agreement and Closing Agreements, in some cases with confidential portions redacted, with Homology’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

Disclaimer of Forward-Looking Statements

This current report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this current report that do not relate to historical facts should be considered forward-looking statements, including, without limited to statements regarding the collaboration between Homology and Oxford and the operation of Newco. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements. .

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expressed or implied by forward-looking statements, including, but not limited to, the following: we may not realize the anticipated benefits of working with Oxford; the impact of the COVID-19 pandemic on our business and operations, including our preclinical studies and clinical trials, and on general economic conditions; we have and expect to continue to incur material losses; our need for additional funding, which may not be available; failure to identify additional product candidates and develop or commercialize marketable products; the first step in our development efforts; potential unforeseen events during clinical trials could cause delays or other adverse consequences; risks relating to the regulatory approval process; our product candidates may cause serious adverse side effects; the inability to maintain our collaborations, or the failure of such collaborations; our reliance on third parties, including for the manufacture of materials for our research programs, preclinical and clinical studies; failure to obtain we or international marketing approval; current regulatory obligations; the effects of significant competition; adverse pricing regulations, third-party reimbursement practices or healthcare reform initiatives; product liability claims; inability to attract, retain and motivate qualified personnel; the possibility of system failures or security breaches; intellectual property risks and significant costs resulting from operating as a public company. These and other important factors discussed under “Risk Factors” in Homology’s Quarterly Report on Form 10-Q for the Quarterly Period Ended September 30, 2021 and our other deposits with the
Security and Exchange Commission could cause actual results to differ materially from those indicated by the forward-looking statements made in this current report. These forward-looking statements represent management’s estimates as of the date of this current report. Although we may choose to update these forward-looking statements at some time in the future, we disclaim any obligation to do so, even if subsequent events change our views.

Section 9.01. Financial statements and supporting documents.

(b) Pro forma financial information.

The following financial information is included in Exhibit 99.1 to this Current Report on Form 8-K and is filed herewith and incorporated herein by reference:

    •     Unaudited Pro Forma Condensed Consolidated Balance Sheet as of
          September 30, 2021.



    •     Unaudited Pro Forma Condensed Consolidated Statements of Operations for
          the year ended December 31, 2020 and the nine months ended September 30,
          2021.


(d) Exhibits.

Exhibit
  No.       Description

99.1          Unaudited Pro Forma Condensed Consolidated Balance Sheet as of
            September 30, 2021 and Unaudited Pro Forma Condensed Consolidated
            Statements of Operations for the year ended December 31, 2020 and the
            nine months ended September 30, 2021

104         Cover Page Interactive Data File (embedded within the inline XBRL
            document)

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