Item
2.01 Completion of Acquisition or Disposition of Assets.
Royalty
Purchase Agreement
On
June 21, 2023, LadRx Corporation, a Delaware corporation (the “Company”), entered into (i) a Royalty Purchase
Agreement (the “Royalty Agreement”) with XOMA (US) LLC (“XOMA”), for the sale, transfer,
assignment and conveyance of the Company’s right, title and interest in and to certain royalty payments and milestone payments
with respect to aldoxorubicin, and (ii) an Assignment and Assumption Agreement (the “Assignment Agreement”)
with XOMA for the sale, transfer, assignment and conveyance of the Company’s right, title and interest in the Asset Purchase Agreement
(the “Asset Purchase Agreement”) between the Company and Orphazyme ApS (“Orphazyme”),
dated as of May 13, 2011, and assigned to Zevra Denmark A/S (“Zevra”), effective as of June 1, 2022, which
includes certain royalty and milestone payments with respect to arimoclomol. The combined aggregate purchase price paid to the Company
for the sale, transfer, assignment and conveyance of the Company’s right, title and interest in and to aldoxorubicin and arimoclomol
was $5 million, less certain transaction fees and expenses.
As
previously reported, on July 27, 2017, the Company entered into an exclusive worldwide license agreement (as amended, the “License
Agreement”) with ImmunityBio, Inc. (formerly known as NantCell, Inc.) (“ImmunityBio”), pursuant
to which the Company granted to ImmunityBio the exclusive rights to develop, manufacture and commercialize aldoxorubicin in all indications.
Pursuant to the License Agreement, the Company was also entitled to receive certain royalty payments for net sales for soft tissue sarcomas
and for other indications.
Pursuant
to the Royalty Agreement, the Company agreed to sell, transfer, assign and convey to XOMA , among other payments, all royalty payments
and regulatory and commercial milestone payments payable to the Company pursuant to the License Agreement. The Royalty Agreement also
provides for the sharing of certain rights with XOMA to bring any action, demand, proceeding or claim as related to receiving such payments.
Pursuant
to the Royalty Agreement, the Company is entitled to receive a one-time payment of $4 million upon the U.S. Food and Drug Administration’s
(the “FDA”) approval of aldoxorubicin.
The
Royalty Agreement also contains representations and warranties, other covenants, indemnification obligations, and other provisions customary
for transactions of this nature.
The
foregoing description of the Royalty Agreement does not purport to be complete and is qualified in its entirety by reference to the full
text of the Royalty Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1 and incorporated herein
by reference.
Assignment
and Assumption Agreement
On
June 21, 2023, the Company entered into the Assignment Agreement with XOMA, pursuant to which, among others, the Company agreed to sell,
transfer and assign to XOMA the Company’s right, title and interest in the arimoclomol pursuant to the Asset Purchase Agreement
(as defined below), including the right to receive certain milestone, royalty and other payments from Zevra.
As
previously reported, on May 13, 2011, the Company sold the rights to arimoclomol to Orphazyme pursuant to an asset purchase agreement,
in exchange for a one-time, upfront payment and the right to receive up to $120 million in milestone payments upon the achievement of
certain pre-specified regulatory and business milestones, as well as royalty payments based on a specified percentage of any net sales
of products derived from arimoclomol. Effective as of June 1, 2022, Orphazyme assigned its rights and obligations under the Asset Purchase
Agreement to Zevra.
Pursuant
to the Assignment Agreement, the Company is entitled to receive (i) a one-time payment of $1 million upon acceptance of a re-submission
of a New Drug Application to the FDA for arimoclomol, and (ii) a one-time payment of $1 million upon the first invoiced sale in certain
territories of a pharmaceutical product derived from arimoclomol as an active pharmaceutical ingredient, subject to the receipt of the
applicable regulatory approval required to sell such a product in such countries.
The
Assignment Agreement also contains representations and warranties, other covenants, indemnification obligations, and other provisions
customary for transactions of this nature.
The
foregoing description of the Assignment Agreement does not purport to be complete and is qualified in its entirety by reference to the
full text of the Assignment Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.2 and incorporated
herein by reference.