| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers. |
Resignation of Officers
On May 14, 2022, the Board approved the removal
of Greg Korbel from his position as the Chief Business Officer, effective at the time of the filing of the Second Merger Certificate of
Merger with the Secretary of State of the State of Delaware (the “Second Effective Time”). After the Second Effective
Time Mr. Korbel will serve as Aprea’s Chief Operating Officer, as more fully described below.
Effective as of the conclusion of the Stockholders’
Meeting, Christian S. Schade will resign as Chief Executive Officer.
Appointment of Officers
On May 14, 2022, the Board approved the following
appointments, effective at the Second Effective Time: (i) the appointment of Oren Gilad, Ph.D. to the position of the President of Aprea
and (ii) the appointment of Greg Korbel to the position of the Chief Operating Officer of Aprea (such appointments, collectively, the
“Second Effective Time Officer Appointments”).
Effective as of the conclusion of the Stockholders’
Meeting, Dr. Gilad will be appointed to the position of Chief Executive Officer of Aprea, to fill the vacancy created by Christian S.
Schade’s resignation as Chief Executive Officer of Aprea (such appointment, collectively with the Second Effective Time Officer
Appointments, the “Officer Appointments”).
Oren Gilad, Ph.D. (Age 54). Oren Gilad,
Ph.D., has extensive leadership experience across all phases of drug development. Prior to joining Aprea, from 2011 to 2022, he was the
Chief Executive Officer of Atrin. Prior to founding Atrin in 2011, Dr. Gilad had a 13-year academic career, where he authored numerous
high impact scientific articles, including one that demonstrated the importance of the ATR pathway in cancer development and prevention.
This breakthrough research was conducted at the University of Pennsylvania. Dr. Gilad holds a B.Sc from the Hebrew University, a Ph.D.
and post-doctorate from the University of California at Davis, and a post-doctorate from the University of Pennsylvania.
Dr. Gilad has no family relationship with any
of the executive officers or directors of Aprea. There are no arrangements or understandings between Dr. Gilad and any other person pursuant
to which he was appointed as an officer of Aprea.
Greg Korbel (Age 46). Prior to being
appointed as Chief Operating Officer of Aprea, Dr. Korbel served as Aprea’s Chief Business Officer since April 2021, having
previously served as Vice President, Business Development since July 2016. Dr. Korbel has more than 12 years of experience in the
biotechnology and pharmaceutical industries. Prior to joining Aprea, he was the Director of Business Development and Operations at
Novira Therapeutics, which was acquired in December 2015 by Johnson & Johnson, and served as the Director of Research Operations
subsequent to the acquisition. In addition to consulting for venture capital and biotechnology firms, Dr. Korbel formerly served as
Senior Scientist at Invitrogen/Life Technologies. Dr. Korbel received an M.B.A. from the Wharton School at the University of
Pennsylvania, a Ph.D. in Chemistry from Harvard University and a B.A. from Vanderbilt University.
Dr. Korbel has no family relationship with any
of the executive officers or directors of Aprea. There are no arrangements or understandings between Dr. Korbel and any other person pursuant
to which he was appointed as an officer of Aprea.
Resignation of Directors
In accordance with the Merger Agreement, on May
16, 2022, Fouad Namouni and Michael A. Kelly resigned from the Board as Class II and Class III directors, respectively, and any respective
committee of the Board to which they were members, effective at the Second Effective Time. The resignations were not the result of any
disagreements with Aprea relating to the Aprea’s operations, policies or practices. Effective immediately prior to the closing of
the Merger, all unexpired, unexercised and unvested options to purchase Aprea’s shares held by the members of the Board accelerated
in full and remain exercisable subject to the terms and conditions of the applicable option award agreement.
Appointment of Directors
In accordance with the Merger Agreement, the Board
increased the number of directors from seven to eight, such that the number of Class I directors on the Board was increased from two to
three. On May 16, 2022, effective as of the Second Effective Time, Michael Grissinger and Rif Pamukcu were appointed as Class II directors.
Additionally, on May 16, 2022, effective as of the Second Effective Time, Dr. Gilad was appointed as a Class III director and Marc Duey
was appointed as a Class I director (Mr. Grissinger’s, Dr. Pamukcu’s, Dr. Gilad’s and Mr. Duey’s appointments
as directors, collectively the “Director Appointments”).
In accordance with the Merger Agreement, at or
immediately after the conclusion of the Stockholders’ Meeting, the Board will increase the number of directors from eight to nine,
with the additional ninth director to be appointed to the Board by the directors then serving on the Board immediately following the Stockholders’
Meeting.
Michael Grissinger (Age 68). Michael Grissinger
brings decades of experience in business development, strategy, and pharmaceutical licensing leadership roles at global pharmaceutical
companies. Since 2018, Mr. Grissinger has served on the board of directors of Akari Therapeutics, Plc (AKTX), a public company that develops
treatments for autoinflammatory diseases involving the complement (C5) and leukotriene (LTB4) pathways. Since 2020, Mr. Grissinger has
served as chair of the board of directors of Kira Biotech Pty Ltd, a private biotechnology company developing novel immunomodulatory compounds
for the treatment of immune system disorders. Since 2018, he has served on the board of directors of Atriva Therapeutics PLC, a private
biopharmaceutical company pioneering the development of host-cell-targeting therapies against viral infections. Mr. Grissinger previously
served on the board of Atrin. Mr. Grissinger served as a senior advisor to Cerberus Capital Management from 2018 to 2021. He retired
from Johnson & Johnson in January 2018 after a 22-year career. During his tenure at Johnson & Johnson, Mr. Grissinger held positions
of Vice President and Head, Worldwide Pharmaceutical Licensing as well as Vice President and Head of Worldwide Pharmaceutical Corporate
Development and M&A.
Prior to joining Johnson & Johnson, Mr. Grissinger
spent 20 years in the healthcare industry with Ciba-Geigy and SmithKline Beckman. Mr. Grissinger holds a B.S. in Chemistry from Juniata
College and an MBA from Temple University- Fox School of Business.
Rif Pamukcu (Age 64). Rifat Pamukcu, M.D.,
has extensive experience in pharmaceuticals and drug development, with a particular focus on oncology. He was a co-founder, director and
CSO of Cell Pathways, a publicly-traded pharmaceutical company (NASDAQ:CLPA) focused on cancer and cancer prevention that was acquired
by OSI Pharmaceuticals in 2003). At Cell Pathways he directed the basic science, preclinical drug development, clinical research, regulatory
programs, and various aspects of chemical scale-up and manufacturing, and raised over $140 million of investment capital. He is currently
director, President and CEO of RXMP Therapeutics, Inc. since 2016, a private pharmaceutical company that is developing novel systemically
delivered hemostatic agents that are designed to arrest or prevent excessive bleeding. Dr. Pamukcu has served as director, President and
CEO of Midway Pharmaceuticals DBA MidwayBiome since 2005, a private pharmaceutical company that is developing nonantibiotic approaches
to affect GI tract and microbiome interactions to aid in gastrointestinal and systemic disorders. He is a Managing Partner of Corami LLC
since 2016, an early-stage therapeutics company developing drug-device combinations that deliver sustained release therapeutics directly
to the external surface of the heart. Dr. Pamukcu serves on the Board of Directors of Syantra, Inc. since 2019 (a breast cancer diagnostics
company), Sirpant Immunotherapeutics, Inc. since 2021 (a hematological malignancy immunotherapeutics company), and Virion Therapeutics
LLC since 2018 (a hepatitis therapeutic vaccine company). He has been a member of the Advisory Council to the National Prostate Cancer
Coalition, the GI Oncology Task Force of the American Gastroenterological Association, Executive Steering Committee of the Gastroenterology
Research Group and Scientific Advisory Board of the Hereditary Colon Cancer Association. Since 1985, Dr. Pamukcu has authored or co-authored
over 110 journal articles, book chapters and abstracts in the fields of gastroenterology, cancer, cancer chemoprevention and signal transduction
systems. He is an inventor on over 150 issued or pending patents in the areas of drug discovery and development of agents for cancer prevention
and therapeutics, inflammatory bowel disease, osteoporosis and the prevention and treatment of hemorrhage. Dr. Pamukcu holds a B.A. in
Biology from the John Hopkins University and an M.D. from the University of Wisconsin School of Medicine. He completed his Internal Medicine
Residency at Rush Presbyterian St. Lukes Medical Center and his Fellowship in Gastroenterology and Hepatology at the University of Chicago.
He was an Assistant Professor in the Division of Digestive Diseases at the University of Cincinnati prior to his joining Cell Pathways,
Inc.
Marc Duey (Age 66). Marc Duey brings over
three decades of experience in the Pharmaceutical and Biotechnology industries and brings a great deal of commercial business, and product
launch experience. Since 2012, he has served as a Managing Partner at Duce Management, LLC, which focuses on biotech and digital
health convergence via early-stage commitments to emerging firms with intellectual property and platform technology of eventual interest
to specialty pharmaceutical manufacturers seeking potential therapies for cancer. Mr. Duey was the Founder, President, and CEO of ProMetrics,
Inc., from 1993 to 2019, a leading sales and patient-level data aggregator and service provider to the specialty pharmaceutical industry
for over two decades. ProMetrics is now the Patient Solutions Division of ConcertAI, a leading real-world data, and AI-based predictive
analytics partner to the largest, most ambitious, and dynamic oncology firms. Mr. Duey founded ProMetrics to provide marketing and sales
teams with strategic and tactical decision support.
Under his direction, the firm helped launch dozens
of biopharma products, serviced over 150 clients, and managed thousands of projects. Seven client biotech firms have been acquired by
seven large oncology companies, also clients, for a total transaction value of over $150 billion. Prior to founding ProMetrics, Mr. Duey
was the founder and President of DuWest Research, an international management consulting firm, with offices on three continents, that
specialized in serving the needs of diagnostic and biotechnology firms. Mr. Duey is a member of numerous trade and industry associations
and sits on the Board of Directors of several technology companies. He is an adjunct professor at West Chester University in both the
Business School and the Pharmaceutical Product Development program (PPD). He serves on the Board of Trustees of International House Philadelphia,
and is a member of the Leadership Council of the Wistar Institute. He is an active member of the American Society of Clinical Oncology
(ASCO), the American Association of Cancer Research (AACR), the American Association of Pharmaceutical Science (AAPS), and the Licensing
Executive Society (LES). Mr. Duey holds a B.S. and an M.S. degree in science from the University of Ottawa, and an M.B.A. from the Ivey
Business School at Western University, London, Canada.
Indemnification Agreements
In connection Director Appointments and the Officer
Appointments, each of the new directors and officers will enter into Aprea’s standard form of indemnification agreement, a copy
of which was filed as Exhibit 10.5 to Aprea’s Registration Statement on Form S-1 (File No. 333-233662) filed with the SEC on October
2, 2019.
Compensation Arrangements with Oren Gilad and
Aprea’s Named Executive Officer
In connection with Dr. Gilad’s appointment
as President, Dr. Gilad entered into Aprea’s standard form of executive employment agreement. Dr. Gilad’s employment agreement
provides for “at will” employment, a base salary of $500,000 per year, an annual target bonus opportunity equal to 50% of
his base salary, and participation in Aprea’s long-term equity incentive program. Under the terms of Dr. Gilad’s employment
agreement, in the event that he is terminated by Aprea without “cause” or he terminates his employment for “good reason,”
he will be entitled to receive, upon execution and effectiveness of a release of claims, (i) continued payment of his then-current
base salary for a period of 12 months following termination, (ii) an annual bonus for the year of termination equal to
his target annual bonus opportunity and prorated based on the number of days in the calendar year that have elapsed prior to
the date of termination, and (iii) a direct payment by us of the medical, vision and dental coverage premiums due to maintain any
COBRA coverage for which he and his dependents are eligible and for which he has appropriately elected through the earlier of (x) 12 months
following termination and (y) the date he becomes employed by another entity or individual. Upon a termination without “cause”
or due to “good reason,” during the 12-month period following a “change of control,” Dr. Gilad is entitled
to 18 months of continued base salary and reimbursement for COBRA coverage premiums rather than 12 months. Dr. Gilad is eligible
to participate in the employee benefit plans generally available to other members of Aprea’s senior executive management, subject
to the terms of those plans.
As noted above, effective as of the
conclusion of the Stockholders’ Meeting, Mr. Schade will resign as Chief Executive Officer. To assist with the transition, Mr.
Schade will remain with Aprea as Executive Chairman until the six month anniversary of the Closing at his same compensation levels
as in effect prior to the closing. At the end of the six-month transition period, Mr. Schade will receive the following severance
benefits under his employment agreement: (i) 12 months of continued base salary; (ii) payout of his annual bonus at his target
percentage for the portion of the year during which he was employed, and (iii) payment of medical, vision and dental coverage
premiums for up to 12 months of continuing COBRA coverage.
Aprea and Mr. Coiante entered into a retention
letter that provides if Mr. Coiante is terminated by Aprea without “cause” or resigns with “good reason” within
one year following the Merger, he will receive the following benefits under his employment agreement: (i) 12 months of continued base
salary; (ii) payout of his annual bonus at his target percentage for the portion of the year during which he was employed; and (iii) payment
of medical, vision and dental coverage premiums for up to 12 months of continuing COBRA coverage.
Dr. Attar will step down as Senior Vice President
and Chief Medical Officer three months after the Closing. At that time, Dr. Attar will receive the following severance benefits under
his employment agreement: (i) nine months of continued base salary; (ii) payout of his annual bonus at his target percentage for the portion
of the year during which he was employed; and (iii) payment of medical, vision and dental coverage premiums for up to nine months of continuing
COBRA coverage.
In connection with the Merger, the vesting of
the outstanding stock options and restricted stock units accelerated upon the Closing, with the stock options remaining exercisable until
their normal expiration dates.
| Item 5.03 | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On May 16, 2022, Aprea filed a Certificate of
Designation of Preferences, Rights and Limitations of the Series A Non-Voting Convertible Preferred Stock with the Secretary of State
of the State of Delaware (the “Certificate of Designation”) in connection with the Merger referenced in Item 1.01 above.
The Certificate of Designation provides for the issuance of shares of preferred stock, par value $0.001 per share, designated as Series
A Non-Voting Convertible Preferred Stock (the “Series A Preferred Stock”).
Holders of Series A Preferred Stock are entitled
to receive dividends on shares of Series A Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form,
and in the same manner, as dividends (other than dividends on shares of the Common Stock payable in the form of Common Stock) actually
paid on shares of the Common Stock when, as and if such dividends (other than dividends payable in the form of Common Stock) are paid
on shares of the Common Stock.
Except as otherwise required by law, the
Series A Preferred Stock will have no voting rights. However, as long as any shares of Series A Preferred Stock are outstanding,
Aprea will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series A Preferred
Stock: (i) alter or change adversely the powers, preferences or rights given to the Series A Preferred Stock or alter or amend the
Certificate of Designation, amend or repeal any provision of, or add any provision to, the Certificate of Incorporation or bylaws of
Aprea, or file any articles of amendment, certificate of designations, preferences, limitations and relative rights of any series of
Preferred Stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions
provided for the benefit of the Series A Preferred Stock, regardless of whether any of the foregoing actions will be by means of
amendment to the Certificate of Incorporation or by merger, consolidation or otherwise, (ii) issue further shares of Series A
Preferred Stock or increase or decrease (other than by conversion) the number of authorized shares of Series A Preferred Stock,
(iii) prior to the Stockholder Approval (as defined in the Certificate of Designation), consummate either: (A) any fundamental
transaction or (B) any merger or consolidation of Aprea with or into another entity or any stock sale to, or other business
combination in which the stockholders of Aprea immediately before such transaction do not hold at least a majority of the capital
stock of Aprea immediately after such transaction or (iv) enter into any agreement with respect to any of the foregoing.
Following stockholder approval of the Conversion
Proposal, each share of Series A Preferred Stock is convertible into shares of Common Stock at any time at the option of the holder thereof,
into 10 shares of Common Stock, subject to certain limitations, including that a holder of Series A Preferred Stock is prohibited from
converting shares of Series A Preferred Stock into shares of Common Stock if, as a result of such conversion, such holder, together with
its affiliates, would beneficially own more than a specified percentage (to be established by the holder between 4.9% and 19.9%) of the
total number of shares of Common Stock issued and outstanding immediately after giving effect to such conversion.
The foregoing description of the Series A Preferred
Stock does not purport to be complete and is qualified in its entirety by reference to the Certificate of Designation, a copy of which
is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.