Patriot Scientific Corporation and Mosaic ImmunoEngineering Inc. Enter into Definitive Merger Agreement (yahoo.com)
CARLSBAD and NOVATO, CA / ACCESSWIRE / August 24, 2020 / Patriot Scientific Corporation (the "Company" or "Patriot") (OTC PINK:PTSC) and Mosaic ImmunoEngineering Inc., ("Mosaic") announced today that they have entered into a definitive agreement under which a wholly-owned subsidiary of Patriot will merge with Mosaic through the issuance of convertible preferred stock. The merged company will focus on advancing its immunotherapy pipeline of products including intra-tumoral immunotherapy of cancer and its modular vaccine platform.
"Patriot was able to create substantial shareholder value for many years through licensing of our broad microprocessor intellectual property patents. However, we recently began to evaluate new opportunities to create stockholder value with the expiration of our patents and unsuccessful court appeals. As part of this process, we evaluated a number of opportunities and we believe that the technology platform at Mosaic has the opportunity to create tremendous shareholder value." said Carlton Johnson, interim president and interim chief financial officer of Patriot. "Mosaic has a broad technology platform with potential in cancer and infectious diseases. We believe this union represents a great opportunity for the stockholders of both companies."
As part of the merger, Mr. Johnson will remain onboard in his executive duties through August 28th to ensure a smooth management transition.
"We appreciate the thorough approach that the board of directors at Patriot took in considering strategic alternatives and we feel that this union has the potential to create significant value for stockholders of both companies moving forward." stated Steven King, president and CEO of Mosaic. "Our technology platforms have broad potential to treat and prevent diseases that span oncology and infectious diseases. The underlying research supporting our product pipeline and technology platforms has been extensive over the past 10 years with funding of over $20 million. We look forward to providing more details regarding our development plans in these areas over the coming weeks."
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About the Transaction
The merger is structured as a stock-for-stock transaction whereby all of Mosaic's outstanding shares of Class A and Class B common stock will be exchanged for Patriot's Series A and Series B Preferred Stock. A subsidiary of Patriot will buy from the stockholders of Mosaic 630,000 shares of its Class A common stock and 70,000 shares of its Class B common stock, representing 100% of the issued and outstanding common stock of Mosaic, in exchange for 630,000 shares of the Patriot's Series A Convertible Preferred Stock ("Series Preferred") and 70,000 shares of Patriot's Series B Convertible Preferred Stock ("Series B preferred), respectively. Each share of the Series A Preferred; shall (a) convert into 5,097.053 shares of common stock of the Parent, (b) possess full voting rights, on an as-converted basis, as the common stock of the Parent, and (c) have no dividend rate. Each share of the Series B Preferred; shall (a) convert into 5,734.185 shares of common stock of the Parent, (b) possess full voting rights, on an as-converted basis, as the common stock of the Parent, (c) have no dividend rate, and (d) shall possess certain anti-dilution protections as defined in the Series B Certificate of Designations. On a fully diluted, as converted basis, it is anticipated that Patriot's equityholders immediately prior to the merger will own 10% of the combined company and Mosaic's equityholders immediately prior to the merger will own 90% of the combined company.
Law Office of Otto E. Sorensen is serving as legal counsel to Patriot |
