Business & Finance
Sesen Bio and Carisma Therapeutics Increase Special Cash Dividend, Gain Stockholder Support for Pending Merger
16 February 2023 - - US-based clinical company Sesen Bio, Inc. (NASDAQ: SESN) and US-based biopharmaceutical company Carisma Therapeutics Inc have reached a voting and support agreement with Bradley L. Radoff and Michael Torok, the companies said.

The Investor Group, which beneficially owns approximately 8.7% of Sesen Bio's outstanding common stock, has committed to vote its shares in support of the pending merger.

In connection with the Support Agreement, Sesen Bio and Carisma have further amended the previously amended merger agreement announced on December 29, 2022, which has been unanimously approved by the boards of directors of both companies:

Increased the one-time special cash dividend expected to be paid to Sesen Bio stockholders to USD 75m, USD 0.36 per share.

This represents an increase from the expected special cash dividend of approximately USD 70m, approximately USD 0.34 per share, under the first amendment to the merger agreement, and an increase from the up to USD 25m special cash dividend under the terms of the original merger agreement;

Extended the period of time for payments under the Contingent Value Right related to any potential proceeds from the sale of Vicineum and Sesen Bio's other legacy assets to March 31, 2027, from December 31, 2023, under the previous terms.

Under the CVR, Sesen Bio stockholders remain entitled to any proceeds from the potential milestone payment under the Roche Asset Purchase Agreement; and

Michael Torok will join the Carisma board of directors upon closing of the merger as the only Sesen Bio representative.

Carisma's previously announced approximately USD 30m financing remains committed and is expected to close concurrently with the pending merger.

The issuance of the special cash dividend and CVR remain contingent on the closing of the pending transaction, which is expected to occur in the first quarter of 2023, subject to approval by Sesen Bio stockholders and other customary closing conditions.

Following completion of the incremental financing from Carisma's key investors and subsequent completion of the merger, Sesen Bio stockholders are expected to own 24.2% of the pro forma company consistent with the exchange ratio formula set forth in the original merger agreement, dated September 20, 2022.

The Sesen Bio Board unanimously recommends that stockholders vote "FOR" each of the proposals listed on the WHITE proxy card enclosed with the previously mailed definitive proxy statement / prospectus.

As previously disclosed, the special meeting of stockholders will be held exclusively via live webcast on March 2, 2023, at 10:00 a.m. eastern time. Sesen Bio stockholders of record as of January 17, 2023, will be entitled to vote at the meeting.

SVB Securities is acting as exclusive financial advisor to Sesen Bio for the transaction and Hogan Lovells US LLP is serving as its legal counsel. Evercore is serving as lead financial advisor to Carisma for the transaction and BofA Securities, Inc. is also serving as financial advisor to Carisma for the transaction.

Wilmer Cutler Pickering Hale and Dorr LLP is serving as legal counsel to Carisma. BofA Securities, Inc. and Evercore are serving as co-placement agents for Carisma's concurrent financing and Shearman & Sterling LLP is serving as the placement agents' legal counsel.

Olshan Frome Wolosky LLP is serving as legal counsel to the Investor Group.

Sesen Bio is a late-stage clinical company focused on targeted fusion protein therapeutics for the treatment of patients with cancer.

Sesen Bio's most advanced product candidate, Vicineum, also known as VB4-845, is a locally-administered targeted fusion protein composed of an anti-epithelial cell adhesion molecule antibody fragment tethered to a truncated form of Pseudomonas exotoxin A for the treatment of non-muscle invasive bladder cancer.

On July 15, 2022, Sesen Bio made the strategic decision to voluntarily pause further development of Vicineum in the US.

The decision was based on a thorough reassessment of Vicineum, which included the incremental development timeline and associated costs for an additional Phase 3 clinical trial, following Sesen Bio's discussions with the United States Food and Drug Administration.

Sesen Bio has turned its primary focus to assessing potential strategic alternatives with the goal of maximizing stockholder value. Additionally, Sesen Bio is seeking a partner for the further development of Vicineum.

Carisma Therapeutics is a biopharmaceutical company dedicated to developing a differentiated and proprietary cell therapy platform focused on engineered macrophages, cells that play a crucial role in both the innate and adaptive immune response.

The first applications of the platform, developed in collaboration with the University of Pennsylvania, are autologous chimeric antigen receptor -macrophages for the treatment of solid tumors.

Carisma is headquartered in Philadelphia, PA.