UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 28, 2017

 

 

INTREXON CORPORATION

(Exact Name of Registrant as Specified in Charter)

 

 

 

Virginia   001-36042   26-0084895

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

2374 Seneca Meadows Parkway, Germantown, Maryland 20876

(Address of Principal Executive Offices) (Zip Code)

(301) 556-9900

(Registrant’s Telephone Number, including area code)

N/A

(Former Name or Former Address, if change since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

On December 28, 2017, Intrexon Corporation (“Intrexon”) and Third Security, LLC (“Third Security”) executed an amendment (the “Third Amendment”) to the Services Agreement, dated as of November 1, 2015, and amended on October 31, 2016 and December 30, 2017 (as amended, the “Services Agreement”), by and between Intrexon and Third Security, in order to extend the term of the Services Agreement from January 1, 2018 to January 1, 2019. No other terms of the Services Agreement were modified by the Third Amendment, which became effective on January 1, 2018. The Third Amendment was unanimously approved by the independent members of Intrexon’s Board of Directors (the “Board”) and the Audit Committee of the Board in accordance with Intrexon’s policy on related person transactions.

The foregoing description of the Third Amendment does not purport to be complete and is subject to, and qualified in its entirety by reference to, the Third Amendment, which is attached hereto as Exhibit 10.1 and incorporated by reference herein. A description of the Services Agreement can be found in Note 17 of Intrexon’s consolidated financial statements included in its Quarterly Report on Form 10-Q for the period ended September 30, 2017, and a copy of the Services Agreement was filed as an exhibit to Intrexon’s Current Report on Form 8-K/A, filed on November 3, 2015.

 

Item 7.01 Regulation FD Disclosure.

On January 2, 2018, Randal J. Kirk, Intrexon’s Chairman and Chief Executive Officer, distributed his annual CEO’s letter to his colleagues at Intrexon. The letter is attached hereto as Exhibit 99.1.

 

Item 8.01 Other Events.

On January 2, 2018, Intrexon’s Compensation Committee is making annual grants of Restricted Stock Units under the Intrexon 2013 Omnibus Incentive Plan, as amended, to the officers of Intrexon. At the request of Intrexon’s Chairman and Chief Executive Officer, Randal J. Kirk, the Compensation Committee is excluding Mr. Kirk from the annual grants.

On December 29, 2017, Intrexon entered into an agreement with the R.J. Kirk Declaration of Trust (the “Investor”), an entity affiliated with Mr. Kirk, pursuant to which the Investor has agreed to purchase 1,207,980 shares of Intrexon’s Common Stock, no par value, in a private placement, for aggregate gross proceeds to Intrexon of $13,686,413.40. The number of shares purchased by the Investor represents just under 1% of the common stock outstanding prior to the private placement, which is the maximum that an affiliate of Mr. Kirk could purchase from Intrexon in the private placement under the rules of the New York Stock Exchange. The price per share in the private placement was $11.33 per share, which was the closing price of Intrexon’s common stock on the New York Stock Exchange on December 28, 2017. The private placement was unanimously approved by the independent members of Intrexon’s Board and the Audit Committee of the Board in accordance with Intrexon’s policy on related person transactions. The transaction was funded and closed on December 29, 2017.

 

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

 

10.1    Third Amendment to Services Agreement, by and between Intrexon Corporation and Third Security, LLC, effective as of January 1, 2018
99.1    2018 Annual CEO Letter from Randal J. Kirk, Chairman and CEO of Intrexon

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.

 

Intrexon Corporation
By:  

/s/ Donald P. Lehr

  Donald P. Lehr
  Chief Legal Officer

Dated: January 2, 2018

Exhibit 10.1

THIRD AMENDMENT TO SERVICES AGREEMENT

THIS THIRD AMENDMENT TO THE SERVICES AGREEMENT (this “ Amendment ”) is made and entered into as of the 28th day of December, 2017, by and between Third Security, LLC, a Virginia limited liability company (“ THIRD SECURITY ”), and Intrexon Corporation, a Virginia corporation (“ INTREXON ”).

WHEREAS, THIRD SECURITY and INTREXON entered into that certain Services Agreement, dated as of November 1, 2015 (the “ Agreement ”), which Agreement was subsequently amended such that the Agreement would expire on January 1, 2017, unless earlier terminated or extended by agreement of the parties pursuant to Section 4 of the Agreement; WHEREAS, the Agreement was subsequently amended such that the Agreement would expire on January 1, 2018; and

WHEREAS, as of the date hereof, THIRD SECURITY and INTREXON desire to amend the Agreement to extend the term of the Agreement to January 1, 2019; and

WHEREAS, pursuant to Section 4 of the Agreement, this Amendment has been approved unanimously by the disinterested directors of the INTREXON Board of Directors.

NOW THEREFORE, in consideration of the mutual promises and covenants herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Amendment, intending to be bound hereby, agree as follows:

1. Defined Terms . All capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Agreement.

2. Section 4 . Section 4 of the Agreement is hereby amended by deleting such section in its entirety and substituting the following in its stead:

“4 . Term of Agreement . The term of this Agreement shall commence immediately upon the date hereof and continue until January 1, 2019 unless earlier terminated by agreement of the parties hereto. The Agreement may be extended on a year-to-year basis by agreement of the Parties, with INTREXON’s agreement conditioned on the unanimous approval of the independent directors of INTREXON’s Board of Directors. Notwithstanding the foregoing, this Agreement shall become terminable (i) at any time by INTREXON upon delivery of written notice to THIRD SECURITY; and (ii) upon thirty (30) days’ notice by THIRD SECURITY upon delivery of written notice to INTREXON. The obligations in Sections 4 , 8 , 9 , 10 and 11 shall survive termination of this Agreement.

3. No Further Amendments . Except as specifically set forth herein, no amendments or modifications to the Agreement are hereby effected, and the Agreement shall remain in full force and effect.

4. Counterparts . This Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed an original but all of which shall together constitute but one and the same instrument.

[ Signature page follows ]

IN WITNESS WHEREOF , the parties hereto have duly executed this Amendment as of the date first above written.

 

THIRD SECURITY, LLC       INTREXON CORPORATION
By:   

/s/ Marcus E. Smith

      By:   

/s/ Donald P. Lehr

Name:    Marcus E. Smith       Name:    Donald P. Lehr
Title:    Senior Managing Director       Title:    Chief Legal Officer
   and General Counsel         

Exhibit 99.1

 

LOGO

Intrexon Corporation Annual CEO Letter

GERMANTOWN, MD, January  2, 2018 – Randal J. Kirk, Chairman and Chief Executive Officer of Intrexon Corporation (NYSE: XON), a leader in the engineering and industrialization of biology to improve the quality of life and health of the planet, sent the following annual letter to his colleagues at Intrexon.

Dear Colleagues,

As you know, it has been customary at this time of year for me to award a grade on the performance of our company in the year just ended. Others grade us and their opinions are mostly expressed in the stock market, which rates our performance for 2017 at ‘F,’ as evidenced by our share price having traded down over 50% in a year in which biotech stocks generally traded very well. And it’s not difficult to see why this was so: We entered 2017 with a wonderful set of leading assets, not merely ‘best in class’ assets but genuine world-beaters, category creating technologies that span industries as diverse as gene and cell therapy, crop protection, environmental solutions such as the OX513A mosquito and innovative food products such as the Arctic™ apple and the AquAdvantage ® salmon. Our shareholders expected us to gain rapid adoption of our technologies and even significant transactions, where appropriate, with logical value-add partners around them and, frankly, we expected this as well. Obviously, whenever performance does not meet expectation there will be consequences and they won’t all be pleasant!

Nevertheless, it is obligatory for us to have our own reckoning. While we must never forget the grade that the market has given us and must always be mindful that one of our main jobs is to make money for our shareholders in the form of a higher share price, we know that our job is somewhat more involved than making the ‘performance minus expectation’ calculation. Like the many experiments conducted every day in our labs from San Diego to Ghent and from Summerland, BC to Budapest, only recording the results is insufficient, but we must analyze the data to interpret the results, if for no other reason than to perform better going forward, whether this be through an experimental redesign or through developing a new commercialization plan to incorporate newly learned information. We must honestly examine ourselves situationally to assess how we did in relation to our plans and our ecosystem and, most importantly, where results have not matched expectations, we must know the reason why and then figure out what to do about it. We have spent a lot of time as a team doing this so I now am prepared to make my own pronouncement.

So how did we do in 2017? I assign us an ‘A’ and here is why in a nutshell: We still have those assets with which we began 2017, and they are more desirable and closer to transactions and markets than ever. We have learned that novel types of assets, no matter how wonderful, are not adopted as rapidly as those that are more conventional. While we knew, for example, that no one previously has had the job of selling billions of engineered mosquitoes, we did not take fully into consideration the consequences of the fact that no one among the prospective counterparties has ever had the job of buying them. In 2017, we learned a great deal about the markets that we are addressing and the ways of doing business among their constituents. In brief, yes, we were geeky and enthusiastic about our technologies and had what seems in retrospect incorrect assumptions as to the rate with which the world should beat a path to our door. I am not going to fault a team, however, for not being so pragmatic and convention-bound as to regard MBP or POC CAR-T, just to cite two examples, to be impossibilities. Our naiveté has a virtue, so long as we continue to be driven by data, but we have now better aligned our vision to the necessities of our political and industrial landscape.

In addition, the mature assets with which we began the year have been supplemented with ever more valuable assets, as evidenced by our achieving in this past year technical success with our Methane Bioconversion Platform. We believe that this platform has demonstrated such economic viability as to qualify it, potentially, as the most valuable biotechnology yet developed. For the first time, we hired an experienced banking firm to assist us in our dialogs with potential partners and the results have been very positive. Since that time, we have hired three more high quality investment banks so that we now have four significant partnering exercises underway around mature programs and platforms. We expect that our receipts from these activities will exceed anything that we may have expected from partnering early stage programs and indeed we now mostly self-finance these in order to target value-inflecting events while they are in our hands and prior to any consideration of partnering.

The majority of you, however, are ‘doing science’ in order to create new technologies and products to solve significant problems in the world. As I often tell you when we meet, however, my job (and the job of the entire top team) is to make your visions show up in the ‘real’ world, to enable your work to matter to people in tangible ways. I want to take this occasion to thank you for your brilliance, your talent and your dedication. Please know that we take our responsibilities to you seriously and that we are committed to our mission.

But the main reason that I think our team deserves an ‘A’ grade is because we did in 2017 precisely what we should have done: We continued to invest in the assets that we believed the strongest and constantly recalibrated, making changes to our business model, to our organization, our management team, to how we partner (and with what sort of company) and how we shall commercialize our mature assets. We persevered and made adjustments in order to win, not only for this team and for our shareholders but for the world.

Wishing you and yours a healthy and prosperous New Year, RJ

About Intrexon Corporation

Intrexon Corporation (NYSE: XON) is Powering the Bioindustrial Revolution with Better DNA ™ to create biologically-based products that improve the quality of life and the health of the planet. Intrexon’s integrated technology suite provides its partners across diverse markets with industrial-scale design and development of complex biological systems delivering unprecedented control, quality, function, and performance of living cells. We call our synthetic biology approach Better DNA ® , and we invite you to discover more at www.dna.com or follow us on Twitter at @Intrexon , on Facebook , and LinkedIn .

Trademarks

Intrexon, Arctic, AquAdvantage, Powering the Bioindustrial Revolution with Better DNA, and Better DNA are trademarks of Intrexon and/or its affiliates. Other names may be trademarks of their respective owners.

Safe Harbor Statement

Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release.

For more information regarding Intrexon Corporation, contact:

Media Contact:

Kekst and Company

Adam Weiner/ Robert Siegfried

Tel: +1 (212) 521-4823/ +1 (212) 521-4832

Corporate Contact:

Marie Rossi, PhD

Director, Technical Communications

Tel: +1 (301) 556-9850

investors@intrexon.com

publicrelations@intrexon.com