Item 1.01. Entry into a Material Definitive Agreement
Casdin and Viking Loan Agreement
On January 23, 2022, Fluidigm Corporation (the "Company") entered into (i) a
Loan Agreement, dated and effective as of January 23, 2022, among the lenders
party thereto affiliated with Casdin Private Growth Equity Fund II, L.P. and the
Company (the "Casdin Loan Agreement") and (ii) a Loan Agreement, dated and
effective as of January 23, 2022, among the lenders party thereto affiliated
with Viking Global Investors LP and the Company (the "Viking Loan Agreement,"
and together with the Casdin Loan Agreement, the "Loan Agreements"). Each Loan
Agreement provides for a $12.5 million term loan to the Company (each, a "Term
Loan" and collectively, the "Term Loans"). The Term Loans were fully drawn on
January 24, 2022. The Term Loans mature on the 91st calendar day after the
latest maturity date of the loans borrowed under the Company's Loan and Security
Agreement, dated as of August 2, 2018 (as amended, the "SVB Loan Agreement"),
with Silicon Valley Bank (the "Maturity Date").
The proceeds of the Term Loans may be used for working capital and general
corporate purposes. The Company may not prepay the Term Loans under the Loan
Agreements without the consent of their respective lenders. The Term Loans are
subordinated to the obligations arising under the SVB Loan Agreement.
The Term Loans bear interest (i) from and including the effective date of the
Loan Agreements to but excluding March 1, 2022, at 10%, (ii) from and including
March 1, 2022 to but excluding June 1, 2022, at 12%, (iii) from and including
June 1, 2022 to but excluding September 1, 2022, at 14%, and (iv) from and
including September 1, 2022 and thereafter, at 16%. Interest accrues daily and
is payable in kind by adding the accrued interest to the outstanding principal
amount on the last date of each month. Principal, together with accrued and
unpaid interest, is due on the Maturity Date.
Upon the issuance of the Series B Preferred Stock (as defined below) pursuant to
the Purchase Agreements (as defined below), the Term Loans will be automatically
converted into a number of shares of Series B-1 Preferred Stock (as defined
below) or Series B-2 Preferred Stock (as defined below), in accordance with the
terms of the Casdin Loan Agreement or the Viking Loan Agreement, as applicable,
equal to (i) the outstanding principal amount of the applicable Term Loan
(including any interest added to the original principal amount thereof) plus
accrued and unpaid interest on the Term Loans divided by $1,000 multiplied by
(ii) the Conversion Price (as defined in the Certificates of Designations (as
defined below) for the Series B Preferred Stock) divided by $2.84. If the Series
B Preferred Stock is not approved for issuance at a stockholder meeting or the
Purchase Agreements are terminated, then the Term Loans will become convertible,
at each lender's option, into common stock, par value $0.001 per share, of the
Company (the "Common Stock") at an initial conversion rate of 352.1126 shares of
Common Stock per $1,000 of conversion amount, subject to the cap set forth in
the Loan Agreements. The conversion rate is subject to customary adjustments as
set forth in the Loan Agreements.
The Loan Agreements contain customary affirmative covenants, including covenants
regarding the payment of taxes and other obligations, maintenance of insurance,
reporting requirements and compliance with applicable laws and
regulations. Further, the Loan Agreements contain customary negative covenants
limiting the ability of the Company and its subsidiaries, among other things, to
. . .
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of the Registrant.
The information set forth in Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
Item 3.02. Unregistered Sales of Equity Securities.
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K
is incorporated by reference herein. The securities of the Company that will be
issued as part of the Preferred Equity Transactions and Loan Agreements will not
initially be registered under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance on the exemption from registration provided by
Section 4(a)(2) of the Securities Act. The investors represented to the Company
in the Purchase Agreements and the Loan Agreements that they are "accredited
investors" within the meaning of Regulation D of the Securities Act.
Item 3.03. Material Modification to Rights of Security Holders.
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K
is incorporated by reference herein.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K
is incorporated by reference herein.
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Resignation of Chief Executive Officer and Director
In connection with the Preferred Equity Transactions contemplated under the
Purchase Agreements, Stephen Christopher Linthwaite, the Company's President and
Chief Executive Officer and a member of the Board, will resign on the terms
described below. Mr. Linthwaite's resignation did not involve any disagreement
with the Company relating to the Company's operations, policies or practices.
Transition Agreement with Stephen Christopher Linthwaite
In connection with the execution of the Purchase Agreements, the Company entered
into a transition agreement and release (the "Transition Agreement") with
Mr. Linthwaite. Pursuant to the Transition Agreement, Mr. Linthwaite will
continue to be employed as the Company's President and Chief Executive Officer
and serve on the Board until the earliest to occur of (i) immediately prior to
the date of Closing, (ii) May 15, 2022 and (iii) such earlier date as
Mr. Linthwaite and the Company mutually agree to terminate the employment
relationship (the earliest date under clause (i), (ii), or (iii) is referred to
as the "Linthwaite Separation Date"), or, if earlier, the date Mr. Linthwaite's
employment with the Company terminates (the period from the effective date of
the Transition Agreement through the Linthwaite Separation Date, the "Transition
Period"). During the Transition Period, Mr. Linthwaite will continue to be
eligible for the same compensation and benefits he was eligible for prior to the
Transition Period, provided that he will not participate in the Company's 2022
bonus plan. The Company will reimburse Mr. Linthwaite's reasonable attorneys'
fees incurred in connection with the review and negotiation of the Transition
Agreement and its enclosed exhibits, up to a maximum of $8,000. The Transition
Agreement includes a limited release in favor of the Company.
The Transition Agreement contemplates that, within 10 days following the
Linthwaite Separation Date, subject to Mr. Linthwaite's timely execution and
non-revocation of a separation agreement and release (the "Separation
Agreement"), Mr. Linthwaite will be entitled to receive the severance benefits
under the Company's 2020 Change of Control and Severance Plan (the "Severance
Plan"), which are: (i) $1,190,000, less applicable withholdings, paid in equal
installments over 24 months; (ii) eligibility for COBRA reimbursement for up to
12 months following the Linthwaite Separation Date; (iii) reasonable
outplacement services in accordance with any applicable Company policy in effect
as of the Linthwaite Separation Date, and (iv) a $200,000 lump sum payment,
provided Mr. Linthwaite remains employed by the Company through the earlier of
(i) the Closing and (ii) May 15, 2022, in all cases subject to the Closing. In
addition, Mr. Linthwaite holds an award of restricted stock unit awards (the
"2022 PSUs") that is eligible to vest based on (i) a relative TSR performance
component in the performance period ending December 31, 2022, and (ii) a
time-based vesting component, and, subject to the Separation Agreement become
effective, the Company will amend the 2022 PSUs to remove the time-based vesting
component, such that, notwithstanding the termination of his service on the
Linthwaite Separation Date, the 2022 PSUs will remain outstanding and eligible
to vest to the extent of achievement of the performance component alone. The
Separation Agreement also provides that the Company will assign to Mr.
Linthwaite and reimburse him for payment of premiums paid by him to maintain the
life insurance policy insuring his life for 30 months following the Linthwaite
Separation Date. The Separation Agreement includes a general release of claims
in favor of the Company and a customary mutual nondisparagement provision. If
any of the severance and other benefits provided for under the Separation
Agreement or otherwise payable to Mr. Linthwaite constitute "parachute payments"
within the meaning of Section 280G of the Internal Revenue Code and could be
subject to excise tax under Section 4999 of the Internal Revenue Code, then the
payments will be delivered in full or delivered as to such lesser extent which
would result in no portion of such benefits being subject to excise tax,
whichever results in the greater amount of after-tax benefits to Mr. Linthwaite.
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The Separation Agreement also contemplates that, commencing on the Linthwaite
Separation Date and continuing through November 30, 2022, Mr. Linthwaite will
provide consulting services to the Company pursuant to the terms of a consulting
agreement (the "Consulting Agreement"). Pursuant to the Consulting Agreement,
Mr. Linthwaite will receive a monthly fee of $25,000 during the term of the
Consulting Agreement. Additionally, if Mr. Linthwaite provides services in
excess of 60 hours in a month, then his monthly fee will be increased by $350
per each hour in excess of 60 hours. During the term of the Consulting
Agreement, the Company will reimburse Mr. Linthwaite for reasonable expenses,
and Mr. Linthwaite will vest in his outstanding Company equity awards in
accordance with the terms and conditions of the awards and the Separation
Agreement and Consulting Agreement.
Pursuant to the terms of the Separation Agreement and the Consulting Agreement,
if the Company terminates Mr. Linthwaite's consulting relationship prior to
November 30, 2022, (i) any unpaid consulting fees that would otherwise have been
paid through the first 6 months following the Linthwaite Separation Date will be
due and payable, and (ii) Mr. Linthwaite's equity awards that would otherwise
vest through November 30, 2022 will vest on an accelerated basis as if he had
. . .
Item 5.03. Amendment to Articles of Incorporation or Bylaws, Change in Fiscal
Year.
To create each of the Series B-1 Preferred Stock and the Series B-2 Preferred
Stock that will be issued as part of the Preferred Equity Transactions and Loan
Agreements, the Company will execute and file a Certificate of Designations with
respect to each such series. The disclosure set forth above in Item 1.01 of this
Current Report on Form 8-K is incorporated by reference herein.
Item 8.01. Other Events.
On January 24, 2022, the Company issued a press release announcing the execution
of the Purchase Agreements and the funding of the Term Loans. The press release
is attached hereto as Exhibit 99.1 and is incorporated by reference into this
Item 8.01.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
10.1 Series B-1 Loan Agreement, dated as of January 23, 2022, by and
among Fluidigm Corporation, Casdin Partners Master Fund, L.P., and
Casdin Private Growth Equity Fund II, L.P.
10.2 Series B-2 Loan Agreement, dated as of January 23, 2022, by and
among Fluidigm Corporation, Viking Global Opportunities Illiquid
Investments Sub-Master LP, and Viking Global Opportunities Drawdown
(Aggregator) LP.
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10.3 Series B-1 Convertible Preferred Stock Purchase Agreement, dated as of
January 23, 2022, by and among Fluidigm Corporation, Casdin Private
Growth Equity Fund II, L.P., and Casdin Partners Master Fund, L.P.
10.4 Series B-2 Convertible Preferred Stock Purchase Agreement, dated as of
January 23, 2022, by and among Fluidigm Corporation, Viking Global
Opportunities Illiquid Investments Sub-Master LP, and Viking Global
Opportunities Drawdown (Aggregator) LP.
10.5 Registration Rights Agreement, dated as of January 23, 2022, by and
between Fluidigm Corporation, Casdin Private Growth Equity Fund II, L.P.,
Casdin Partners Master Fund, L.P., Viking Global Opportunities Illiquid
Investments Sub-Master LP, and Viking Global Opportunities Drawdown
(Aggregator) LP.
10.6 Stephen Christopher Linthwaite Transition Agreement and Release.
10.7 Michael Egholm Offer Letter.
10.8 Indemnification Agreement, dated January 23, 2022, by and between
Fluidigm Corporation and Michael Egholm.
10.9 Hanjoon Alex Kim Offer Letter.
10.10 Form of Retention Letter.
99.1 Fluidigm Corporation Press Release dated January 24, 2022.
104 Cover Page Interactive Date File (embedded within the Inline XBRL
document)
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