-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MHSfrgwpNI5HrbdPIgffGeqdE2+k5EYpKP4ewkIhN/klvjamqfI+on82OWsp+z1w gs7s47ac0h0TYgxL08Ti0w== 0000891020-03-002407.txt : 20031001 0000891020-03-002407.hdr.sgml : 20031001 20030930200516 ACCESSION NUMBER: 0000891020-03-002407 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030902 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031001 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TARGETED GENETICS CORP /WA/ CENTRAL INDEX KEY: 0000921114 STANDARD INDUSTRIAL CLASSIFICATION: BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836] IRS NUMBER: 911549568 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-23930 FILM NUMBER: 03918896 BUSINESS ADDRESS: STREET 1: 1100 OLIVE WAY STREET 2: STE 100 CITY: SEATTLE STATE: WA ZIP: 98101 BUSINESS PHONE: 2066237612 MAIL ADDRESS: STREET 1: 1100 OLIVE WAY STREET 2: STE 100 CITY: SEATTLE STATE: WA ZIP: 98101 8-K 1 v93386e8vk.txt FORM 8-K 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 SEPTEMBER 2, 2003 (Date of Report) (Date of Earliest Event Reported) TARGETED GENETICS CORPORATION (Exact Name of Registrant as Specified in Charter) WASHINGTON 0-23930 91-1549568 (State or Other Jurisdiction (Commission File No.) (IRS Employer of Incorporation) Identification No.) 1100 OLIVE WAY, SUITE 100, SEATTLE, WA 98101 (Address of Principal Executive Offices, Including Zip Code) (206) 623-7612 (Registrant's Telephone Number, Including Area Code) NOT APPLICABLE (Former Name or Former Address, if Changed Since Last Report) 1 ITEM 5. OTHER EVENTS. On September 2, 2003, Targeted Genetics Corporation converted approximately $9.4 million in outstanding loans and interest payable to Elan International Services Ltd. into 5,203,244 shares of Targeted Genetics common stock. This transaction consists of the conversion of $7.4 million in outstanding principal and accrued interest into approximately 3.5 million shares of common stock at a price of $2.09 per share. Targeted Genetics is also converting approximately $2.0 million in outstanding principal and accrued interest borrowed at various dates into approximately 1.6 million shares of common stock at conversion prices determined at the time of the borrowing. The notes and interest payable to Elan had a scheduled maturity in July 2005. A copy of the press release related to this conversion is attached as Exhibit 99.1 and is incorporated into this current report by reference. In connection with the issuance of common stock to Elan, on September 2, 2003, Targeted Genetics entered into the Fourth Amendment to Rights Agreement between Targeted Genetics and Mellon Investor Services LLC. This amendment changed the ownership threshold triggering the Rights Plan from 15% to 20% with respect to Elan. A copy of the amendment is attached as Exhibit 4.1 and is incorporated into this current report by reference. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits. 4.1 Fourth Amendment to Rights Agreement between Targeted Genetics Corporation and Mellon Investor Services LLC dated September 2, 2003 99.1 Press Release of Targeted Genetics Corporation dated September 30, 2003 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. TARGETED GENETICS CORPORATION Date: September 30, 2003 By: /S/ TODD E. SIMPSON ------------------------------------ Todd E. Simpson Vice President, Finance and Administration and Chief Financial Officer, Secretary and Treasurer INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION - -------------- ----------- 4.1 Fourth Amendment to Rights Agreement between Targeted Genetics Corporation and Mellon Investor Services LLC dated September 2, 2003 99.1 Press Release of Targeted Genetics Corporation dated September 30, 2003
EX-4.1 3 v93386exv4w1.txt EXHIBIT 4.1 Exhibit 4.1 TARGETED GENETICS CORPORATION FOURTH AMENDMENT TO RIGHTS AGREEMENT This Fourth Amendment to Rights Agreement (this "Amendment") is made as of September 2, 2003 by and between Targeted Genetics Corporation, a Washington corporation (the "Company") and Mellon Investor Services LLC, formerly known as ChaseMellon Shareholder Services, a New Jersey limited liability company, as rights agent (the "Rights Agent"). RECITALS WHEREAS, the Company and the Rights Agent are parties to the Rights Agreement dated as of October 17, 1996, as amended by the First Amendment of Rights Agreement dated as of July 21, 1999, by the Second Amendment to Rights Agreement, dated September 25, 2002, by the Third Amendment to Rights Agreement, dated January 23, 2003 (as amended, the "Rights Agreement"). Any capitalized terms not specifically defined in this Amendment shall have the meanings given those terms in the Rights Agreement. AGREEMENT WHEREAS, the parties wish to amend the Rights Agreement as provided herein. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. The penultimate sentence of the definition of "Acquiring Person" in Section 1 is hereby amended and replaced with the following: "Notwithstanding the foregoing, neither Elan International Services, Ltd. ("EIS") nor any Affiliate or Associate of EIS shall be included within the definition of "Acquiring Person" by virtue of the acquisition by EIS of shares of Common Stock, or any securities convertible into or exchangeable for shares of Common Stock, pursuant to the transactions contemplated by the Securities Purchase Agreement, dated July 21, 1999, between the Company and EIS and the Convertible Promissory Note, dated July 21, 1999, issued by the Company to EIS (the "Transaction Securities"); provided, however, EIS shall be included within the definition of Acquiring Person to the extent EIS, either alone or together with all Affiliates and Associates of EIS, becomes the Beneficial Owner of 20% or more of the Common Stock then outstanding as the result of being or becoming the Beneficial Owner of Common Stock including the Transaction Securities." 2. Each party represents and warrants to the other party that it has full power and authority to execute and deliver this Amendment and to perform the transactions contemplated hereunder. 3. The terms and provisions of the Rights Agreement, as amended hereby, shall remain in full force and effect. All references to the "Rights Agreement" contained therein shall mean the Rights Agreement, as amended by this Amendment. 4. This Amendment may be executed in one or more counterparts, all of which shall be considered one and the same agreement. IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment to be duly executed as of the date first written above. TARGETED GENETICS CORPORATION By: /s/ TODD SIMPSON ------------------------------ Name: Todd Simpson ------------------------------ Title: VP Finance and CFO ----------------------------- MELLON INVESTOR SERVICES LLC By: /s/ LISA PORTER ------------------------------ Name: Lisa Porter ------------------------------ Title: Client Service Manager ----------------------------- EX-99.1 4 v93386exv99w1.txt EXHIBIT 99.1 Exhibit 99.1 [LOGO OF TARGETED GENETICS] CONTACT: Targeted Genetics Corporation Courtney Self (206) 521-7392 TARGETED GENETICS REDUCES LONG-TERM CASH OBLIGATIONS THROUGH CONVERSION OF DEBT INTO EQUITY SEATTLE, WA -- September 30, 2003 -- Targeted Genetics announced today that it has converted all of its outstanding convertible debt into equity under a collaborative agreement established in 1999 with Elan Corporation, plc and its affiliates (Elan). Targeted Genetics converted approximately $9.4 million in outstanding loans and interest payable to Elan into approximately 5.2 million shares of restricted and unregistered common stock. This conversion consists of $2.0 million in debt, borrowed at various dates, into 1.6 million shares of common stock at conversion prices determined at the time of borrowing, and $7.4 million in debt being converted into 3.5 million shares of common stock at a price of $2.09 per share, the 60-day trading average preceding the conversion date. The conversion of this debt was completed under the terms of a convertible promissory note. The promissory note and interest payable to Elan had a scheduled maturity in July 2005, unless converted earlier by Targeted Genetics or Elan. "The conversion of this debt obligation into equity significantly improves our financial position, and acting on this now avoids the accrual of an additional $2.3 million in interest charges that would have accumulated through maturity," said Todd E. Simpson, chief financial officer of Targeted Genetics. "Eliminating this $11.7 million cash debt service requirement is part of our longer-term funding strategy, and allows us to continue to focus our cash resources on the advancement of our cystic fibrosis, AIDS vaccine and arthritis programs." The Company borrowed funds under a promissory note from Elan in connection with a research and development joint venture between Targeted Genetics and Elan, called Emerald Gene Systems, which was formed in July 1999. Emerald Gene Systems was focused on the development of additional applications of Targeted Genetics' non-viral gene delivery capabilities and specifically on pursuing Targeted Genetics' lipid-based gene delivery program targeting metastatic cancer treatment indications. The initial three-year development period for Emerald concluded in August 2002 and no further development activities have been pursued. Generally Elan requires the consent of Targeted Genetics prior to assignment or transfer of this common stock and other securities of Targeted Genetics held by Elan. As a result of this conversion, Elan currently holds a total of approximately 7.7 million shares of Targeted Genetics common stock, representing 11.7 percent of Targeted Genetics' issued and outstanding common stock. Elan also holds 12,015 shares of Targeted Genetics' Series B convertible preferred stock that is currently convertible into approximately 4.8 million shares of common stock. If Elan's ownership equals or exceeds 10 percent of Targeted Genetics' common stock, Elan has the right to nominate one director, who must be acceptable to Targeted Genetics, for election to Targeted Genetics' board of directors. Targeted Genetics had $24.8 million in cash as of June 30, 2003, and in August of this year, received $4.8 million through the issuance of common stock to Biogen, Inc. Targeted Genetics develops gene therapy products for treating acquired and inherited diseases. Targeted Genetics has a lead clinical product development program targeting cystic fibrosis and a promising pipeline of product candidates focused on arthritis, an AIDS vaccine, hemophilia and cancer. Targeted Genetics has a broad platform of gene delivery technologies as well as a promising body of technology for cellular therapy. For more information about Targeted Genetics Corporation, please visit its web site at http://www.targetedgenetics.com. NOTE: This release contains forward-looking statements regarding our financial condition and financial strategy , which are based on opinions and estimates of our management at the time the statements are made and are subject to risks and uncertainties that could cause actual results to differ materially from those expected or implied by these forward-looking statements. Inaccurate assumptions and known and unknown risks and uncertainties can affect the accuracy of these forward-looking statements. Factors that could affect our actual results include, but are not limited to, changes in our financing plan, changes in our business, as well as the other risk factors described in the section entitled "Factors Affecting Our Operating Results, Our Business and Our Stock Price" included in our report on Form 10-Q for the quarter ended June 30, 2003. You should not rely unduly on these forward-looking statements, which apply only as of the date of this release. We undertake no obligation to reflect new information, circumstances or events after the date of this release or to reflect the occurrence of unanticipated events. ### -----END PRIVACY-ENHANCED MESSAGE-----