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TELK > SEC Filings for TELK > Form 8-K on 1-Jul-2014All Recent SEC Filings

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Form 8-K for TELIK INC


1-Jul-2014

Other Events, Financial Statements and Exhibits


Item 8.01 Other Events.

On June 30, 2014, Telik, Inc., or Telik, and MabVax Therapeutics, Inc., or MabVax, entered into an Amendment No. 1, or the Amendment, to the Agreement and Plan of Merger, dated as of May 12, 2014, by and among Telik, MabVax and Tacoma Acquisition Corps, or the Merger Agreement. As set forth in detail in the supplemental disclosures below which will also be provided in a proxy supplement to Telik's definitive proxy statement filed with the Securities and Exchange Commission, or the SEC, on June 3, 2014, the Amendment modifies the definition of Company Common Stock Financing in Exhibit A to the Merger Agreement, certain redemption provisions in the Certificate of Designations, Preferences and Rights of Series A-1 Convertible Preferred Stock and the Certificate of Designations, Preferences and Rights of Series A-2 Convertible Preferred Stock, which are attached to the Merger Agreement as Exhibit E and Exhibit F, respectively and removes certain references to Telik's obligations to assume MabVax's obligations to redeem shares of MabVax Series C-1 Convertible Preferred Stock and Series C-2 Convertible Preferred Stock.

Other than as provided in the Amendment, the Merger Agreement, as filed with the SEC on May 12, 2014 as Exhibit 2.1 to Telik's Current Report on Form 8-K, remains in full force and effect as originally executed on May 12, 2014. The following description of the Amendment and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the Amendment, a copy of which is filed as Exhibit 2.1 hereto and is incorporated herein by reference.

SUPPLEMENT TO THE PROXY STATEMENT FOR THE

ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON JULY 3, 2014

On June 30, 2014, Telik, Inc., or Telik, and MabVax Therapeutics, Inc., or MabVax, entered into an amendment, or the amendment, to the agreement and plan of merger, dated May 12, 2014, pursuant to which agreement a wholly owned subsidiary of Telik will merge with and into MabVax, with MabVax surviving as a wholly owned subsidiary of Telik, or the proposed transaction.

In connection with the amendment, the following information is provided to supplement Telik's definitive proxy statement filed on June 3, 2014, or the proxy statement. Text that is bold and struck through in the disclosures below shows text being removed from those disclosures and text that is bold and underlined below shows text being added to those disclosures. Terms used but not otherwise defined herein have the meanings given to them in the proxy statement, and all references to captions and page numbers refer to captions and page numbers in the proxy statement, respectively unless otherwise provided.

THE PROXY STATEMENT CONTAINS IMPORTANT ADDITIONAL INFORMATION AND THIS SUPPLEMENT SHOULD BE READ IN CONJUNCTION WITH THE PROXY STATEMENT.

1. The risk factor entitled "Telik's stockholders' rights will be limited by and subordinate to the rights of the holders of Series A-1 preferred stock and Series A-2 preferred stock; these rights may have a negative effect on the value of shares of Telik common stock." on page 16 is amended as follows:

Telik's stockholders' rights will be limited by and subordinate to the rights of the holders of Series A-1 preferred stock and Series A-2 preferred stock; these rights may have a negative effect on the value of shares of Telik common stock.

Upon filing of the Series A-1 certificate of designations, the holders of the Series A-1 preferred stock, and, to the extent the Series A-2 certificate of designations is filed, the holders of the Series A-2 preferred stock, will have rights and preferences generally superior to those of the holders of Telik's common stock. The existence of these superior rights and preferences may also have a negative effect on the value of shares of Telik's common stock.


These rights are more fully set forth in the Series A-1 certificate of designations and, to the extent filed, the Series A-2 certificate of designations and include, but are not limited to:

the right to receive a liquidation preference, prior to any distribution of Telik's assets to the holders of Telik's common stock, in an amount equal to $0.8383584 per share for the Series A-1 preferred stock and $4.1917918 per share of the Series A-2 preferred stock, if issued, subject to adjustments, and all accrued and unpaid dividends;

the right to convert shares of Series A-1 and Series A-2 preferred stock into shares of Telik common stock at the conversion price set forth in the applicable certificates of designations which may be adjusted as set forth therein and as summarized in the sections entitled "Proposal 5: Approval of Series A-1 Certificate of Designations" and "Proposal 6: Approval of Series A-2 Certificate of Designations" in this proxy statement and;

the right to receive dividends in arrears at a rate of 8% per annum in preference to the holders of Telik's common stock and to receive dividends made to holders of Telik's common stock on an as converted basis.; and

the right to force Telik to redeem shares of Series A-1 and Series A-2 preferred stock upon certain triggering events at a price likely to be in excess of the fair market value of such shares of Series A-1 and Series A-2 preferred stock.

2. The risk factor entitled "The holders of the Series A-1 and Series A-2 preferred stock will have the right to force Telik to redeem shares of issued and outstanding Series A-1 and Series A-2 preferred stock upon certain triggering events at a price likely to be in excess of the fair market value of such shares of Series A-1 and Series A-2 preferred stock; should any redemption be triggered, Telik will be unable to redeem the shares and there would be a significant impact on Telik's ability to continue its operations and the shares of Telik capital stock may lose substantial value." commencing on page 17 is deleted as follows:

The holders of the Series A-1 and Series A-2 preferred stock will have the right to force Telik to redeem shares of issued and outstanding Series A-1 and Series A-2 preferred stock upon certain triggering events at a price likely to be in excess of the fair market value of such shares of Series A-1 and Series A-2 preferred stock; should any redemption be triggered, Telik will be unable to redeem the shares and there would be a significant impact on Telik's ability to continue its operations and the shares of Telik capital stock may lose substantial value.

Telik does not currently have the capital resources to fulfill any potential redemption obligations should Telik be required to redeem shares of issued outstanding Series A-1 or Series A-2 preferred stock following the merger. In the event of such redemption, Telik would likely be forced to seek additional funding on terms that would likely be detrimental to the other holders of Telik's capital stock, or if such funding is unavailable, sell its business or curtail or cease its operations. Telik could also be forced to grant additional rights to the holders of the Series A-1 and Series A-2 preferred stock which would likely be detrimental to the holders of in order to secure a waiver of these redemption rights from the holders of the Series A-1 preferred stock and Series A-2 preferred stock. Events that might trigger these redemption obligations are further set forth in the Series A-1 and Series A-2 certificates of designation and include, among others, the following events:

the suspension from trading or failure of Telik's common stock to be listed for more than two (2) trading days on the NASDAQ Capital Market;

a conversion failure or notice to any Series A-1 or A-2 holder of Telik's intention not to comply with a request for conversion;



Telik's failure to pay to the holders of the Series A-1 preferred stock or the Series A-2 preferred stock any amounts that at any time exceed $25,000 when and as due;

any default under, redemption of or acceleration prior to maturity of any of Telik's indebtedness in excess of $100,000 in the aggregate;

certain Telik bankruptcy events;

the consummation of a change of control other than one in which a successor entity that is a publicly traded corporation;

any deviation of twenty percent (20%) or more in the aggregate of the approved yearly budget previously provided to MabVax; and

the existing preferred stock is not converted in full into common stock on or prior to the effective date of the Series A-1 or A-2 certificate of designations.

3. The section entitled "Merger Consideration" commencing on page 45 is supplemented with the following disclosure:

The amendment amended Sections 1.4(b) and 1.9 of the merger agreement to remove, among other things, references stating that Telik would assume MabVax's obligations to redeem shares of Series C-1 Convertible Preferred Stock and Series C-2 Convertible Preferred Stock following the effective time of the merger.

4. The section entitled "Covenants; Conduct of Business Pending Closing" commencing on page 57 is supplemented with the following additional disclosure:

The amendment amended and restated the definition of "Company Common Stock Financing" in the merger agreement to mean (a) the sale and issuance of shares of the MabVax common stock for aggregate proceeds of up to $3,750,000 in a private placement at one or more closings to be held prior to the closing of the merger and (b) such other issuances as are contemplated in connection with such financing, including (i) the issuance of one or more warrants to purchase shares of MabVax common stock to placement agents participating in such financing on the current terms set forth in placement agent agreements in existence as of the date hereof; and (ii) the issuance of additional "anti-dilution" shares of MabVax common stock, for no additional consideration, to purchasers of MabVax common stock participating in closings of such financing held prior to the closing of the merger; provided, however that (A) such additional "anti-dilution" shares shall only be issued in the event that MabVax sells shares of the MabVax common stock at a price per share less than $2.54 (other than shares issuable upon conversion of existing convertible securities, securities issued pursuant to equity incentive plans and shares issued in the Merger) prior to the first to occur of (x) December 31, 2015 and (y) the date on which MabVax raises an aggregate of $10,000,000, (B) the number of additional shares shall be calculated on a weighted average based on the price per share of equity securities sold by the Company following the initial closing of such financing and (C) in no event will a purchaser be issued a number of additional shares of MabVax common stock in excess of 33% of the number of shares initially purchased by such purchaser.

5. The fourth paragraph in the section entitled "Terms of the Series A-1 Preferred Stock" under Proposal 5 on page 76 is deleted as follows:

The Series A-1 preferred stock will be redeemable for the greater of 110% of the sum of (A) the quotient of $0.8383584 per share divided by the exchange ratio and (B) accrued and unpaid dividends at the election of the Series A-1 holders upon any triggering events provided in the Series A-1 certificate of designations. Such triggering events include, among others, the suspension from trading or failure of Telik's common stock to be listed for more than two
(2) trading days; a conversion failure or notice to any Series A-1 holder of Telik's intention not to comply with a request for conversion; Telik's failure to pay to the Series A-1 holder any amounts that at any time exceed $25,000 when and as due; any default under, redemption of or acceleration prior to maturity of any of Telik's indebtedness in excess of $100,000 in the aggregate;certain bankruptcy event of Telik; the consummation of a change of control other than one in which a successor entity that is a publicly traded corporation; and the existing preferred stock of MabVax is not converted in full into common stock on or prior to the effective date of the Series A-1 certificate of designations.

6. The first paragraph under the section entitled "Terms of the Series A-2 Preferred Stock" under Proposal 6 on page 79 is deleted as follows:


The Series A-2 preferred stock will be redeemable for the greater of 110% of the sum of (A) the quotient of $4.1917918 per share divided by the exchange ratio and (B) accrued and unpaid dividends at the election of the Series A-2 holders upon any triggering events provided in the Series A-2 certificate of designations. Such triggering events include, among others, the suspension from trading or failure of Telik's common stock to be listed for more than two
(2) trading days; a conversion failure or notice to any Series A-2 holder of Telik's intention not to comply with a request for conversion; Telik's failure to pay to the Series A-2 holder any amounts that at any time exceed $25,000 when and as due; any default under, redemption of or acceleration prior to maturity of any of Telik's indebtedness in excess of $100,000 in the aggregate; certain bankruptcy events of Telik; the consummation of a change of control other than one in which a successor entity that is a publicly traded corporation; any deviation of twenty percent (20%) or more in the aggregate of the approved yearly budget; and the existing preferred stock of MabVax is not converted in full into common stock on or prior to the effective date of the Series A-2 certificate of designations, among others.

7. The section entitled "Common Stock" on page 123 is supplemented with the following disclosure.

In the event that, during the period beginning as of the date of common stock . . .



Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

Exhibit
  No.        Description

2.1          Amendment No. 1, dated as of June 30, 2014, by and between Telik and
             MabVax.


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