As previously disclosed, on August 11, 2020, Cellular Biomedicine Group, Inc. (the “Company” or “CBMG”), a Delaware corporation, entered into a definitive merger agreement (the “Merger Agreement”) with CBMG Holdings, an exempt company with limited liability incorporated under the laws of the Cayman Islands (“Parent”), and CBMG Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of the Parent (“Merger Sub”), pursuant to which Merger Sub will be merged with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Parent.
In connection with the Merger, the Company and Parent filed a joint voluntary declaration (the “Declaration”) under Section 721 of the Defense Production Act of 1950, as amended (“DPA”), with the Committee on Foreign Investment in the United States (“CFIUS”). CFIUS accepted the Declaration on August 27, 2020.
On October 21, 2020, the Company and Parent filed a joint notice under the DPA with CFIUS that was accepted on October 28, 2020. CFIUS conducted a 45-calendar-day review, at the end of which it commenced an additional 45-calendar day investigation of the Merger, pursuant to the DPA.
On January 28, 2021, following the CFIUS review and investigation, the Company and Parent received written notice from CFIUS that it had concluded its review of the Merger and there were no unresolved national security concerns associated with the Merger.
Receipt of CFIUS clearance satisfies one of the remaining conditions to the closing of the transaction contemplated by the Merger Agreement. The Merger remains subject to receipt of stockholder approval and other customary closing conditions.
As previously disclosed, the Company will hold a special meeting of the stockholders on February 8, 2021 at 9:00 a.m. Eastern time, at 9605 Medical Center Drive, Suite 100, 1st floor, Rockville, Maryland 20850, at which the Company’s stockholders will be asked to consider and vote on, among other things, the proposal to adopt the Merger Agreement and authorize and approve the transactions contemplated thereby, including the Merger. Stockholders of record as of the close of business, Eastern time, on December 18, 2020 will be entitled to vote at the special meeting and any adjournment thereof.
The Company’s board of directors (without the participation of Tony (Bizuo) Liu, Darren O’Brien and Hansheng Zhou, who abstained from voting given their relationships with Parent), acting upon the unanimous recommendation of the special committee formed by the board of directors, has approved the Merger Agreement, and the transactions contemplated thereby, including the Merger, and recommended that the Company’s stockholders vote in favor of the adoption of the Merger Agreement.
The Company continues to target completion of the Merger in February 2021. However, there can be no assurances regarding the timing or likelihood of the satisfaction of the remaining closing conditions and the consummation of the Merger.
Forward Looking Statements
Statements in this communication relating to plans, strategies, specific activities, and other statements that are not descriptions of historical facts, including our statements regarding the completion of the Merger and targeted timing, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include any risks detailed from time to time in CBMG’s reports filed with the Securities and Exchange Commission, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K, including risks relating to the impact of the COVID-19 pandemic on our operations, including risks associated with the evolving COVID-19 pandemic and actions taken in response to it. Such statements are based on the current beliefs and expectations of the management of CBMG and are subject to significant risks and uncertainties outside of CBMG’s control. These risks and uncertainties include the possibility that the anticipated benefits from the proposed transaction will not be realized, or will not be realized within the expected time periods; the occurrence of any event, change or other circumstances