On May 20, 2022, Mirum Pharmaceuticals, Inc., a Delaware corporation (the “Company”), Styx Merger Sub, Inc., a Delaware corporation (“Merger Sub”), Satiogen Pharmaceuticals, Inc., a Delaware corporation (“Satiogen”), and Shareholder Representative Services LLC, a Colorado limited liability company, solely in its capacity as the representative of certain securityholders of Satiogen (“Securityholders’ Representative”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) and consummated the transactions contemplated thereby pursuant to which Satiogen became a wholly owned subsidiary of the Company.
Pursuant to the terms and conditions of the Merger Agreement, Merger Sub merged with and into Satiogen (the “Merger”) whereupon the separate corporate existence of Merger Sub ceased, with Satiogen continuing as the surviving corporation of the Merger and a wholly owned subsidiary of the Company.
The upfront consideration for the Merger consisted of a combination of 641,799 shares of the Company’s common stock, par value $0.0001 (“Common Stock”), and approximately $2.8 million in cash in respect of an equivalent amount of cash on the books of Satiogen acquired by the Company at the closing of the Merger. The upfront consideration was subject to adjustment for, among other things, unpaid indebtedness and unpaid transaction expenses. 32,494 shares of Common Stock were held back from the upfront consideration by the Company and will remain so for a period of 12 months to satisfy customary post-closing purchase price adjustments and indemnification claims, subject to the terms and conditions of the Merger Agreement. Under the Merger Agreement, the Company has also agreed to issue an additional 199,993 shares of Common Stock as Merger consideration upon achievement of a certain milestone.
The Merger Agreement contains customary representations and warranties of each of the parties as well as customary covenants and additional agreements. The Merger Agreement includes indemnification provisions whereby the equityholders of Satiogen will indemnify the Company for losses arising out of, among other things, inaccuracies in, or breaches of, the representations, warranties and covenants of Satiogen and the pre-closing taxes of Satiogen, subject to certain caps and other limitations. The Company may satisfy certain claims for damages subject to indemnification by deducting from the shares of Common Stock held back from the upfront consideration, setting off from the shares of Common Stock issuable upon achievement of the milestone or proceeding directly against the equityholders of Satiogen, in each case, subject to the terms and conditions of the Merger Agreement.
The shares of Common Stock issued as consideration for the Merger were not registered under the Securities Act of 1933, as amended (the “Securities Act”), and were offered pursuant to the exemption provided in Section 4(a)(2) under the Securities Act. Pursuant to the Merger Agreement, the Company agreed to file a Registration Statement on Form S-3 to register the shares of Common Stock issued and to be issued as consideration for the Merger in order to permit such holders to re-sell such shares, subject to certain limitations, including certain lock-up provisions, and subject to the terms and conditions of the Merger Agreement.
