Generation Bio Co. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Other Events, Financial Statements and Exhibits
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Item 1.01 Entry into a Material Definitive Agreement.
Agreement and Plan of Merger
On December 15, 2025, Generation Bio Co., a Delaware corporation (the “Company”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with XOMA Royalty Corporation, a Nevada corporation (“Parent”), and XRA 7 Corp., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub” and together with Parent, the “Buyer Entities”).
Pursuant to the Merger Agreement, and upon the terms and subject to the conditions therein, the Buyer Entities will commence a tender offer (the “Offer”) to acquire all of the issued and outstanding shares (the “Company Shares”) of common stock, par value $0.0001 per share, of the Company (the “Company Common Stock”), for (i) $4.2913 per Company Share, payable in cash, without interest (such amount, or any different amount per share paid pursuant to the Offer, the “Cash Amount”), plus (ii) one contingent value right per Company Share (each, a “CVR”), which represents the right to receive certain payments in cash in accordance with the terms and subject to the conditions of a contingent value rights agreement (the “CVR Agreement”) to be entered into by the Buyer Entities with Broadridge Corporate Issuer Solutions, LLC, a Pennsylvania limited liability company (the “Rights Agent”) (the Cash Amount plus one CVR, together, the “Offer Price”). The Offer will remain open for 20 business days, subject to extension under certain circumstances.
Following the consummation of the Offer, subject to the terms and conditions of the Merger Agreement, and in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), Merger Sub will merge with and into the Company as provided in the Merger Agreement, with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Merger”). The Merger Agreement contemplates that the Merger will be effected pursuant to Section 251(h) of the DGCL, which permits completion of the Merger without a stockholder vote promptly following consummation of the Offer. At the effective time of the Merger (the “Effective Time”), each Company Share (other than (i) Company Shares owned by the Company (or held in the treasury of the Company), Parent, Merger Sub or any of their respective subsidiaries or (ii) Company Shares that are held by stockholders who are entitled to, and properly demand, appraisal for such Company Shares in accordance with Section 262 of the DGCL) will be cancelled and converted into the right to receive the Offer Price from Merger Sub (the “Merger Consideration”) without interest, subject to any applicable withholding tax. The closing of the Merger is expected to occur in or around February 2026, subject to the satisfaction of customary closing conditions.
The obligations of the Buyer Entities to consummate the Offer are subject to the satisfaction or waiver of a number of conditions set forth in the Merger Agreement, including that there have been validly tendered and not validly withdrawn prior to the expiration of the Offer a number of Company Shares that, considered together with the number of Company Shares, if any, then owned beneficially by Parent and its subsidiaries, would represent at least one more Company Share than 50% of the total number of Company Shares outstanding at the time of expiration of the Offer. In addition, the obligation of Merger Sub to consummate the Offer is conditioned upon, among other things, the accuracy of the representations and warranties of the Company contained in the Merger Agreement (subject to certain materiality exceptions), material compliance by the Company with its covenants under the Merger Agreement and other customary closing conditions. Consummation of the Offer is not subject to a financing condition.
The Merger Agreement provides for the following treatment of the Company’s stock options and restricted stock unit awards:
· | Effective immediately prior to the Effective Time, each option to purchase shares of Company Common Stock that is outstanding and unexercised as of immediately prior to the Effective Time and has an exercise price that is less than the Cash Amount ( an “In-the-Money Option”), shall become fully vested and shall automatically be cancelled and converted into the right to receive an amount in cash, without interest equal to the product obtained by multiplying (i) the excess of the Cash Amount over the exercise price per share of the Company Common Stock underlying such Company Option at the Effective Time by (ii) the number of shares of Company Common Stock underlying such In-the-Money Option, subject to the terms and conditions specified in the Merger Agreement; |
· | At the Effective Time, each option to purchase shares of Company Common Stock that is outstanding and unexercised as of immediately prior to the Effective Time and that is not an In-the-Money Option (an “Out-of- |
the-Money Option”) shall be cancelled and cease to exist, and no consideration shall be delivered in exchange for such Out-of-the-Money Option; and
· | Unless otherwise determined by the board of directors of the Company (the “Company Board”), no later than five (5) Business Days prior to the Effective Time, each Company restricted stock unit award that is then outstanding and unvested shall become vested in full and shall be settled by the Company by issuing to the holder a number of shares of Company Common Stock equal to the number of shares of Company Common Stock underlying such restricted stock unit award immediately prior to such settlement (subject to applicable withholdings for taxes, which may be satisfied by net share settlement). The shares of Company Common Stock issued in respect of the Company restricted stock unit awards shall be treated in the same manner as other shares of Company Common Stock at the Effective Time. |
The Company has agreed to take such actions with respect to the Company’s 2020 Employee Stock Purchase Plan (the “Company ESPP”) that are necessary to provide that (i) the Company ESPP will terminate immediately prior to the Effective Time and (ii) no new offering period will commence under the Company ESPP following the date of the Merger Agreement.
The Merger Agreement includes customary representations, warranties and covenants of the Company, Parent and Merger Sub. The Company has agreed, until the earlier of the termination of the Merger Agreement or the Offer closing time, to, among other things, use commercially reasonable efforts to carry on its operations according to its ordinary course of business, subject to certain exceptions as set forth in the Merger Agreement.
The Company has also agreed to customary non-solicitation restrictions, including not to initiate, solicit, knowingly encourage or facilitate or participate in any discussions or negotiations with third parties regarding other proposals for alternative business combination transactions involving the Company or change the recommendation of the Company Board to the Company’s stockholders regarding the Offer, in each case, except as otherwise permitted by the Merger Agreement, including to enter into an alternative transaction that constitutes a Superior Company Proposal (as defined in the Merger Agreement) in compliance with the Company Board’s fiduciary duties under applicable law and subject to payment of a termination fee.
The Merger Agreement also includes customary termination provisions for both the Company and Parent, including, among others, the right of either party to terminate for failure to consummate the Offer on or before April 15, 2026. If the Merger Agreement is terminated under certain circumstances specified in the Merger Agreement, the Company will be required to pay Parent a termination fee of $840,000 (including under specified circumstances in connection with the Company’s entry into an agreement with respect to a Superior Company Proposal or the Company Board’s change of recommendation in favor of the Offer). The parties to the Merger Agreement are also entitled to specifically enforce the terms and provisions of the Merger Agreement.
The Company Board unanimously: (i) determined that the Merger Agreement, the Offer, the Merger and the other transactions contemplated by the Merger Agreement are advisable and fair to, and in the best interests of, the Company and its stockholders; (ii) agreed that the Merger shall be subject to Section 251(h) of the DGCL; (iii) approved the execution, delivery and performance by the Company of the Merger Agreement and the consummation of the Offer, the Merger and the other transactions contemplated by the Merger Agreement and approved the CVR Agreement and the transactions contemplated thereby; and (vi) resolved to recommend that the stockholders of the Company accept the Offer and tender their Company Shares to Merger Sub pursuant to the Offer.
The foregoing summary of the principal terms of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full copy of the Merger Agreement, which is filed as Exhibit 2.1 hereto and is incorporated herein by reference. The summary and the copy of the Merger Agreement are intended to provide information regarding the terms of the Merger Agreement and are not intended to modify or supplement any factual disclosures about the Company in its public reports filed with the U.S. Securities and Exchange Commission (the “SEC”). The assertions embodied in the representations and warranties included in the Merger Agreement were made solely for purposes of the contract among the Company, Merger Sub and Parent and are subject to important qualifications and limitations agreed to by the Company, Merger Sub and Parent in connection with the negotiated terms, including being qualified by confidential disclosures, for the purposes of allocating contractual risk between the parties thereto. Moreover, some of those representations and warranties were made as of a specified date, may be subject to a contractual standard of materiality different from those generally applicable to the Company’s SEC filings or may have been used for purposes of
allocating risk among the Company, Merger Sub and Parent rather than establishing matters as facts. Investors should not rely on the representations and warranties or any description of them as characterizations of the actual state of facts of the Company, Parent, Merger Sub or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, and this subsequent information may or may not be fully reflected in public disclosures by the Company or Parent.
Tender and Support Agreements
On December 15, 2025, in connection with the execution and delivery of the Merger Agreement, Atlas Venture Fund X, L.P., a Delaware limited partnership, Atlas Venture Associates X, L.P., a Delaware limited partnership and Atlas Venture Associates X, LLC, a Delaware limited liability company, Jason Rhodes and Geoff McDonough (collectively, the “Support Stockholders”), solely in their respective capacities as stockholders of the Company, each entered into a tender and support agreement (collectively, the “Tender and Support Agreements”) with Parent and Merger Sub, pursuant to which each Support Stockholder agreed, among other things, (i) to tender all of the Company Shares held by such Support Stockholder in the Offer, subject to certain exceptions (including the valid termination of the Merger Agreement), (ii) to, if applicable, vote all of such Support Stockholder’s Company Shares in favor of the Merger, and (iii) to certain other restrictions on its ability to take actions with respect to the Company and its Company Shares. The Support Stockholders own approximately 15.38% of the outstanding Company Shares as of December 12, 2025. The Tender and Support Agreements will terminate upon the earliest of (i) the date and time upon which the Merger Agreement is validly terminated in accordance with its terms, and (ii) the date and time upon which the Merger becomes effective.
The foregoing description of the Tender and Support Agreements does not purport to be complete and is qualified in all respects by reference to the full text of the form of Tender and Support Agreement, which is attached as Exhibit 2.2 hereto and is incorporated by reference herein.
Contingent Value Rights Agreement
At or prior to the time at which the Buyer Entities irrevocably accept for purchase all Company Shares validly tendered (and not validly withdrawn) pursuant to the Offer, the Buyer Entities and the Rights Agent will enter into the CVR Agreement. The CVRs are contractual rights only and not transferable except under certain limited circumstances, will not be certificated or evidenced by any instrument and will not be registered with the SEC or listed for trading. The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Parent, Merger Sub or the Company or any of their affiliates.
Each CVR represents a right to receive the following cash payments, subject to reduction for any applicable tax withholding (the “CVR Payments”) in the following circumstances:
· | If the Company’s Closing Net Cash, as finally determined after the Effective Time exceeds $28.97 million, holders of CVRs will receive their pro rata share of such excess (without interest); provided, that if the Company’s Closing Net Cash as finally determined after the Effective Time is less than $28.97 million, the proceeds otherwise payable under other CVR Payments will be reduced by the amount of such shortfall; |
· | If the Company recovers or realizes amounts related to the settlement or other resolution of the Binney Lease (as defined in the CVR Agreement), holders of CVRs will receive their pro rata share of such proceeds, including, if the amount by which the Binney Lease Arrangement Amount (as defined the CVR Agreement) exceeds the Binney Settlement Amount (as defined in the CVR Agreement) (such amount, the “Binney Recovery”) is greater than $10 million, 100% of the first $10 million and 90% of any remaining excess, or if the Binney Recovery is less than $10 million, 90% of the Binney Recovery, and in each case, inclusive of any interest accrued in excess of $500,000, net of any amounts used or retained by the landlord and reasonable, documented out-of-pocket costs and expenses incurred by Parent in connection with the termination or settlement of the Binney Lease; |
· | If Parent sells, licenses, or otherwise monetizes certain legacy intellectual property assets within five years after the closing, holders of CVRs will receive their pro rata share of the net proceeds (without interest) during the 10-year CVR period, with such CVR Payments declining over time, starting at 70% of net proceeds for transactions in years 1–2, 60% in years 3–4, 50% in years 5–6, and 30% in years 7–10; and |
· | If Parent receives proceeds in respect of the existing Collaboration and License Agreement with ModernaTX, Inc. during the 10-year CVR period, holders of CVRs will receive their pro rata share of a declining percentage of those proceeds (without interest), starting at 90% in years 1–3, 80% in years 4–5, 70% in years 6–7, and 50% in years 8–10. |
There can be no assurance that any CVR Payment will be received.
The foregoing description of the CVR Agreement does not purport to be complete and is qualified in all respects by reference to the full text of the form of the CVR Agreement, a copy of which is attached as Exhibit 2.3 hereto and is incorporated by reference herein.
Item 8.01 Other Events.
Press Release
On December 15, 2025, the Company issued a joint press release with Parent announcing the parties’ entry into the Merger Agreement. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated herein by reference.
Important Information for Stockholders and Where to Find It
The Offer referenced in this Current Report on Form 8-K has not yet commenced. This Current Report on Form 8-K is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell shares, nor is it a substitute for the Offer materials that Parent and Merger Sub will file with the SEC. The solicitation and offer to buy outstanding shares of Company Common Stock will only be made pursuant to the Offer materials that Parent and Merger Sub intend to file with the SEC. At the time the Offer is commenced, Parent and Merger Sub will file Offer materials on Schedule TO with the SEC and the Company will file a Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the Offer. THE COMPANY’S STOCKHOLDERS ARE URGED TO CAREFULLY READ THE OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT ON SCHEDULE 14D-9 (AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME), WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL EACH CONTAIN IMPORTANT INFORMATION ABOUT THE OFFER AND PROPOSED MERGER THAT THE COMPANY’S STOCKHOLDERS SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR SHARES. The Schedule TO, including the Offer to Purchase, the related Letter of Transmittal and certain other Offer documents and the Solicitation/Recommendation Statement on Schedule 14D-9, will be made available to all of the Company’s stockholders at no expense to them and will also be made available for free at the SEC’s website at www.sec.gov. Additional copies of the Offer materials filed by the Company may be obtained for free at the Company’s website at https://generationbio.com/ or by contacting the Company at [email protected]. Additional copies of the Offer materials filed by Parent and Merger Sub may be obtained for free under the “SEC Filings” section of Parent’s website at https://investors.xoma.com/sec-filings. In addition to the Offer to Purchase, the related Letter of Transmittal and certain other Offer documents and the Solicitation/Recommendation Statement on Schedule 14D-9, the Company and Parent each file annual, quarterly and current reports and other information with the SEC, which are available to the public over the internet at the SEC’s website at http://www.sec.gov.
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K contains “forward-looking” statements that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those implied by the forward-looking statements. These statements may be identified by words such as “aims,” “anticipates,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “plans,” “possible,” “potential,” “seeks,” “will” and variations of these words or similar expressions, although not all forward-looking statements contain these words. Forward-looking statements in this Current Report on Form 8-K include, but are not limited to, statements regarding the proposed transactions between Parent, Merger Sub and the Company, including the Offer and Merger, the expected timetable for completing the proposed transactions, the potential benefits of the transactions, the potential consideration amount from the proposed transactions and the terms of the Merger Agreement and CVR Agreement, and any other statements about the Company’s management’s future expectations, beliefs, goals, plans or prospects. The Company may not actually achieve the plans, intentions or expectations disclosed in these forward-looking statements, and you should not place
undue reliance on these forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in these forward-looking statements as a result of various factors, including, among other things, the risk that the proposed transactions may not be completed in a timely manner, or at all, which may adversely affect the Company’s business and the price of Company Common Stock; the possibility that various closing conditions of the Offer or the Merger may not be satisfied or waived; uncertainty regarding how many of the Company’s stockholders will tender their shares in the Offer; the risk that competing offers or acquisition proposals will be made; the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement and the transactions; uncertainty as to the ultimate transaction costs; the risk that no CVR Payments will be made under the CVR Agreement; the effect of the announcement or pendency of the proposed transactions on the Company’s trading price, business, operating results and relationships with collaborators, vendors, competitors and others; the risk that stockholder litigation or legal proceedings in connection with the proposed transactions may result in significant costs of defense, indemnification and liability, or present risks to the timing or certainty of the closing of the proposed transactions; the outcome of any stockholder litigation or legal proceedings that may be instituted against the Company related to the Merger Agreement or the proposed transactions; changes in the Company’s businesses during the period between announcement and closing of the proposed transactions; uncertainties pertaining to other business effects, including the effects of industry, market, economic, political or regulatory conditions, future exchange and interest rates and changes in tax and other laws, regulations, rates and policies; and other risks and uncertainties, any of which could cause the Company’s actual results to differ from those contained in the forward-looking statements, that are described in greater detail in the section entitled “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2025 filed with the SEC on November 5, 2025, as well as in other filings the Company may make with the SEC in the future and in the Schedule TO and related Offer documents to be filed by Parent and Merger Sub. Any forward-looking statements contained in this Current Report on Form 8-K speak only as of the date hereof, and the Company does not undertake and expressly disclaims any obligation to update any forward-looking statements contained herein, whether because of any new information, future events, changed circumstances or otherwise, except as otherwise required by law.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. | Description of Exhibit | |
2.1* | ||
2.2 | ||
2.3 | ||
99.1 | Joint Press Release, dated December 15, 2025, issued by Parent and the Company. | |
104 | Cover Page Interactive Data File (embedded within XBRL document) |
* | Schedules, exhibits and similar attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company hereby agrees to supplementally furnish to the SEC upon request any omitted schedule, exhibit or similar attachment to Exhibit 2.1. |
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.
GENERATION BIO CO. | ||
Date: December 15, 2025 | By: | /s/ Yalonda Howze |
Name: Yalonda Howze | ||
Title: Interim Chief Executive Officer and President | ||