SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): August 28, 2003
HYBRIDON, INC.
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(Exact name of Registrant as Specified in its Charter)
Delaware 0-027352 04-3072298
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
345 Vassar Street, Cambridge, Massachusetts 02139
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(Address of Principal Executive Offices) Zip Code)
Registrant's telephone number, including area code: (617) 679-5500
Not Applicable
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(Former Name or Former Address if Changed Since Last Report)
ITEM 5. OTHER EVENTS AND REQUIRED FD DISCLOSURE
Hybridon, Inc. ("Hybridon" or the "Company") is filing this current
report on Form 8-K to report a private placement conducted by it and voting
agreements entered into by it with some of the holders of Hybridon's Series A
convertible preferred stock as a condition to the private placement. Hybridon is
also reporting that it entered into an amendment to its Shareholder Rights Plan.
PRIVATE PLACEMENT
On August 28, 2003, Hybridon raised approximately $14.3 million in
gross proceeds from a private financing with institutional and accredited
investors. In the financing, the Company sold approximately 19.6 million shares
of its common stock and warrants to purchase approximately 5.9 million shares of
common stock. The warrants to purchase common stock have an exercise price of
$1.00 per share and will expire if not exercised by August 28, 2008. Of the
amount raised, approximately $10 million came from U.S. investors and
approximately $4.3 million came from non-U.S. investors. Spencer Trask Ventures
acted as a selected dealer for Hybridon in the U.S.
The net proceeds to Hybridon, excluding the proceeds of any exercise of
the warrants, are expected to total approximately $12.7 million. Hybridon
currently intends to use these funds for research and product development
activities, including costs of conducting preclinical studies and costs of
continuing clinical trials of its two lead compounds, HYB2055 and GEM(R)231, for
settlement of Hybridon's 9% convertible subordinated notes, totaling $1.3
million in principal, and for other general and administrative purposes.
In connection with the private placement, Hybridon also issued warrants
to selected dealers and placement agents which assisted the Company with the
private placement, including Spencer Trask. These include warrants to purchase
approximately 2.4 million shares of common stock at an exercise price of $0.73
per share and warrants to purchase approximately 1.3 million shares of common
stock at an exercise price of $1.00 per share. These warrants will expire if not
exercised by August 28, 2008.
The securities offered by Hybridon in the private placement were not
registered under the Securities Act of 1933, as amended, and can not be offered
or sold in the United States absent registration or an applicable exemption from
registration requirements. Hybridon has agreed to file a registration statement
with the Securities and Exchange Commission registering the resale of the shares
of common stock issued in the private placement, the shares of common stock
issuable upon exercise of the warrants issued in the private placement and the
shares of common stock issuable upon exercise of the warrants issued to the
selected dealers and placement agents.
VOTING AGREEMENTS WITH HOLDERS OF SERIES A CONVERTIBLE PREFERRED STOCK
Hybridon has entered into voting agreements with the holders of 59.3%
of Hybridon's Series A convertible preferred stock. Under these agreements,
these
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holders have agreed to vote to approve an amendment to Hybridon's charter
providing for:
o a reduction in the liquidation preference of the Series A
convertible preferred stock from $100 per share to $1 per
share;
o a reduction in the dividend on the Series A convertible
preferred stock from 6.5% per annum to 1.0% per annum; and
o an increase in the conversion ratio for the Series A
convertible preferred stock (i.e., the number of shares of
common stock issuable upon conversion of the Series A
convertible preferred stock will be increased) by 25% that
would be effective for a 30-day period following the filing of
the amendment to Hybridon's charter.
In addition, in these voting agreements, the Series A holders have
agreed to convert a number of shares of Series A convertible preferred stock
held by them, representing 43.6% of the Series A convertible preferred stock
outstanding, into 9,837,478 shares of common stock during the 30-day period
following the filing of the amendment to Hybridon's charter. Hybridon expects
that additional shares of Series A convertible preferred stock will be converted
into common stock during the 30-day period. As a result, subject to the charter
amendment being approved at a meeting of Hybridon's stockholders and the
conversion of the shares of Series A convertible preferred stock occurring as
agreed, the cumulative liquidation preference of the entire class of Series A
convertible preferred stock remaining outstanding would be reduced from its
current level of approximately $70.0 million to an amount not exceeding
$388,260.
These voting agreements were reached in conjunction with the Company's
private placement. Hybridon has agreed to call a special meeting of stockholders
to vote on the amendment to the charter. The amendment requires the approval of
the holders of a majority of the outstanding Series A convertible preferred
stock entitled to vote at the meeting and the approval of the holders of a
majority of the outstanding common stock entitled to vote at the meeting, with
each class voting separately.
AMENDMENT TO RIGHTS AGREEMENT
On August 27, 2003, Hybridon entered into an amendment ("Amendment No.
1") to the Rights Agreement, dated as of December 10, 2001 (the "Rights
Agreement"), between Hybridon and Mellon Investor Services LLC, as Rights Agent.
Amendment No. 1 (i) establishes a category of Exempted Persons that are excluded
from the definition of Acquiring Person under the Rights Agreement and (ii)
provides that Pillar Investment Limited, together with its affiliates and
associates ("Pillar"), will be an Exempted Person under the Rights Agreement
until such time as Pillar beneficially owns more than 11,000,000 shares of the
Company's common stock (subject to adjustment) or less than 14% of the common
stock then outstanding. Youssef El-Zein, the Chairman and Chief Executive
Officer of Pillar Investment Limited, is a director of the Company.
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Amendment No. 1 is attached hereto as Exhibit 4.1 and is incorporated
herein by reference. The foregoing description of Amendment No. 1 does not
purport to be complete and is qualified in its entirety by reference to such
Exhibit.
ITEM 7. EXHIBITS.
Exhibit No. Description
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4.1 Amendment No. 1 to Rights Agreement dated as of August 27, 2003
between Hybridon, Inc. and Mellon Investor Services LLC, as
Rights Agent
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: August 28, 2003 HYBRIDON, INC.
/s/ Robert G. Andersen
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Robert G. Andersen
Chief Financial Officer and
Vice President of Operations
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EXHIBIT INDEX
Exhibit No. Description
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4.1 Amendment No. 1 to Rights Agreement dated as of August 27, 2003
between Hybridon, Inc. and Mellon Investor Services LLC, as
Rights Agent
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