UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
DIVISION OF
CORPORATION FINANCE
April 29,
2020
Arnaud Ajdler
Managing Member
Engine Capital, L.P.
1345 Avenue of the Americas 33rd Floor
New York, New York 10105
Re: CymaBay Therapeutics, Inc.
PREC14A filed by Engine Capital L.P., et al.
Filed April 24, 2020
File No. 001-36500
Dear Mr. Ajdler,
We have reviewed the above-captioned filing, and have the following
comments. Some
of our comments may ask for additional information so we may better understand
the disclosure.
Please respond to this letter by amending the filing and/or by
providing the requested
information. If you do not believe our comments apply to your facts and
circumstances and/or
do not believe an amendment is appropriate, please tell us why in a written
response.
After reviewing any amendment to the filing and any information
provided in response to
these comments, we may have additional comments.
Preliminary Proxy Statement filed under cover of Schedule 14A
General
1. Please advise us when the participants anticipate distributing their proxy
statement. Given
that reliance on Rule 14a-5(c) is impermissible at any time before the
registrant distributes its
proxy statement, the participants will accept all legal risk in connection
with distributing the
initial definitive proxy statement without all required disclosures and
should undertake to
subsequently provide any omitted information in a supplement in order to
mitigate that risk.
2. The disclosure on the first page indicates that the participants
"beneficially own in the
aggregate approximately 9.4% of the outstanding shares of common stock" of
the registrant.
As the date of the annual meeting and date of distribution for the proxy
statement remain
unknown, please advise us how this amount of beneficial will be affirmed.
Arnaud Ajdler
April 29, 2020
Page 2
Reasons for the Solicitation, page 8
3. Please refer to the following contention: "We question the Board's
motivation, if other than
entrenchment..." The participants' apparent attempt to imply that incumbent
directors may
be motivated by self-interest and are thus perpetuating a plan of
self-preservation through
"entrenchment" ignores and is in conflict with the action undertaken by the
registrant's
Board to reduce its size to 5 members from 9. Please revise to explicitly
support the cited
contention in light of actions recently undertaken by the registrant's Board
since December
of 2019, or delete the unqualified contention. Refer to Note b. of Rule
14a-9.
4. Please refer to the following contention: "..only to have our overtures
rebuffed without the
Board ever making a counterproposal." This contention appears to be in
conflict with an
earlier representation in the proxy statement which indicated the
participants "rejected the
Board's offer to discuss appointing one, but not two, of Engine's
nominees..." Please
reconcile these disclosures given that it appears the participants have
equated the rejection of
their proposal with a failure of the current Board to meaningfully engage
with shareholders.
5. Please provide the factual foundation and/or analysis to support the
participants' assertion
that the registrant's financial performance suffers from an alleged elevated
cash burn rate.
We Are Concerned with the Company's Prolonged Stock Price Underperformance,
page 8
6. To the extent the suspension of the studies relating to the registrant's
leading drug candidate,
seladelpar, and the corresponding Seladelpar Investigation, may have
materially impacted the
performance of the registrant's stock price, the disclosure should provide
this context. Please
revise or advise. Refer to Rule 14a-9(a), which, by its terms, prohibits the
omission of any
material fact necessary in order to make the statements made not misleading.
Voting and Proxy Procedures, page 18
7. Please refer to the following assertion: "we reserve the right to vote some
or all of our shares
[ ] for some or all of the Company's director nominees, as we see fit, in
order to achieve a
Board composition that we believe is in the best interest of all
stockholders." Given that the
registrant's Board is composed of five directors, and the participants are
seeking support at
the Annual Meeting to elect their three nominees in opposition to the
registrant's director
nominees, Rule 14a-4(d)(4) is unavailable. Consequently, the proxy authority
sought cannot
be used for any of the registrant's nominees. Please revise to clarify, if
true, that the cited
reference to "some or all of our shares" is intended to mean only the
approximately 9.4% of
shares beneficially owned by the participants. See Rule 14a-4(d)(1).
8. Please refer to the following two statements: "This Proxy Statement is
soliciting proxies to
elect only our Nominees. Accordingly, the enclosed BLUE proxy card may only
be voted for
the Nominees and does not confer voting power with respect to the Company's
nominees."
Notwithstanding the inferences that may be drawn, please disclose how the
two remaining
board vacancies will be filled if all of the participants' nominees are
elected. In addition,
Arnaud Ajdler
April 29, 2020
Page 3
please address how vacancies will be filled in the situation where any of
the registrant's
nominees refuse to serve in the event any of the participants' nominees are
elected.
* * *
We remind you that the participants are responsible for the accuracy
and adequacy of
their disclosures, notwithstanding any review, comments, action or absence of
action by the staff.
You may contact me at (202) 551-3266 with any questions.
Sincerely,
/s/ Nicholas P.
Panos
Nicholas P. Panos
Senior Special
Counsel
Office of Mergers
and Acquisitions
cc: Andrew Freedman, Esq.
Olshan Frome Wolosky LLP