| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
On June 19, 2019, Invitae Corporation (“Invitae”) completed its acquisition of Singular Bio, Inc. (“Singular Bio”) in accordance with the terms of the Agreement and Plan of Merger and Reorganization (the “Merger Agreement”), dated as of June 17, 2019, among Invitae, Santa Barbara Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Invitae (“Merger Sub”), Singular Bio and Fortis Advisors LLC (as representative of Singular Bio’s stockholders) pursuant to which Invitae acquired 100% of the fully diluted equity of Singular Bio. Pursuant to the Merger Agreement, Merger Sub merged with and into Singular Bio, with Singular Bio surviving as a wholly-owned subsidiary of Invitae (the “Merger”).
At the closing of the Merger, Invitae issued an aggregate of 2,498,705 shares of its common stock and approximately $5.7 million in cash to the former securityholders of Singular Bio. A portion of the cash consideration is subject to a hold back to satisfy indemnification obligations that may arise in connection with the Merger Agreement.
In connection with the Merger, Invitae entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with certain stockholders of Singular Bio, pursuant to which Invitae will register for resale on FormS-3 the shares of Invitae’s common stock issued in the Merger. The Registration Rights Agreement provides that such registration rights will expire at such time as such shares of Invitae common stock have been disposed of pursuant to the resale registration statement or pursuant to Rule 144 promulgated under the Securities Act of 1933, or as to any holder when all of such holder’s shares may be sold pursuant to Rule 144 without limitation as to manner of sale restrictions or volume limitation.
Following consummation of the Merger, Invitae granted an aggregate of $90 million of restricted stock units (the “Inducement Awards”) to the former employees of Singular Bio in connection with and as an inducement to their post-Merger employment by Invitae, pursuant to time-based restricted stock unit award agreements and development milestone-based restricted stock unit award agreements (the “RSU Agreements”) with each such employee. Under the RSU Agreements, Invitae will issue shares of its common stock to the employees at such times, and upon such conditions (including with respect to the vesting of such shares upon the occurrence of certain time-based and development milestone-based contingencies), as are set forth therein.
The foregoing descriptions of the Merger, the Merger Agreement, the Registration Rights Agreement and the transactions contemplated thereby, and the RSU Agreements are not complete and are qualified in their entirety by the full text of the Merger Agreement, the Registration Rights Agreement, the Form of Time-Based RSU Agreement and the Form of Milestone RSU Agreement, which will be filed as exhibits to Invitae’s Quarterly Report on Form10-Q for the quarter ending June 30, 2019.
| Item 3.02 | Unregistered Sales of Equity Securities. |
Pursuant to the Merger described in Item 2.01 above, Invitae issued an aggregate of 2,498,705 shares of its common stock upon closing of the Merger in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933.
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