|AUDENTES THERAPEUTICS, INC. filed this Form 10-K on 03/13/2017|
AUDENTES THERAPEUTICS, INC.
Notes to Consolidated Financial Statements — Continued
In October 2015, the Company entered into a preferred stock purchase agreement with existing and new investors and issued 4,325,954 shares of Series C convertible preferred stock at a price per share of $15.0256. Proceeds to the Company net of the placement agent fee and expenses were approximately $62.8 million.
The rights, privileges, and preferences of convertible preferred stock are summarized as follows:
Upon liquidation, dissolution, or winding up of the Company (whether voluntary or involuntary), or Deemed Liquidation Event (as defined below), before any distribution or payment shall be made to the holders of common stock, each series of convertible preferred stock shall be entitled to be paid on a pari passu basis out of the funds and assets available for distribution, an amount equal to the Original Issue Price of $2.2300 for holders of Series Seed convertible preferred stock, $5.9727 for holders of Series A convertible preferred stock, $11.1942 for holders of Series B convertible preferred stock and $15.0256 for holders of Series C convertible preferred stock, plus any dividends declared but unpaid thereon. If upon any liquidation, dissolution, winding up or Deemed Liquidation Event of the Company, the assets of the Company available for distribution to shareholders is insufficient to pay the holders of shares of preferred stock in full, the holders of preferred stock will share ratably in any distribution. After payment of all preferential amounts required to be paid to the holders of preferred stock, the remaining funds and assets available for distribution to the shareholders of the Company will be distributed among the holders of preferred stock and common stock, pro rata based on the number of shares held by each such holder.
The following events are defined as Deemed Liquidation Events unless the holders of at least 66.67% of the then outstanding shares of convertible preferred stock elect otherwise by written notice to the Company:
Each holder of shares of convertible preferred stock is entitled to the number of votes equal to the number of shares of common stock into which such shares of convertible preferred stock could be converted and has voting rights and powers equal to the voting rights and powers of the common stock, and except as provided by law or by other provisions of the Certificate of Incorporation, shall vote together with the common stock as a single class on an as-converted basis on all matters as to which holders of common stock have the right to vote.
The holders of convertible preferred stock, voting together as a single class, are entitled to elect four members of the Company’s Board of Directors. The holders of common stock, exclusively and as a separate class, are entitled to elect one member of the Company’s Board of Directors. The one remaining member of the Company’s Board of Directors is elected by the holders of the common stock and any other series or class of voting stock, including the convertible preferred stock, exclusively and voting together as a single class.
The holders of convertible preferred stock are subject to certain optional and mandatory conversion rights.