Sec Form 13D Filing - BIOTECHNOLOGY VALUE FUND L P filing for XOMA ROYALTY CRP DEP REPSTG 1/ (XOMAO) - 2019-12-20

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 2)¹

XOMA Corporation

(Name of Issuer)

Common Stock, $0.0075 par value

(Title of Class of Securities)

98419J 206

(CUSIP Number)

JAMES KRATKY

BVF PARTNERS L.P.

44 Montgomery St., 40th Floor

San Francisco, California 94104

(415) 525-8890

 

ADAM W. FINERMAN, ESQ.

OLSHAN FROME WOLOSKY LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

 

December 18, 2019

(Date of Event Which Requires Filing of This Statement)

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ☒.

Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7 for other parties to whom copies are to be sent. 

1              The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

1

NAME OF REPORTING PERSON

BIOTECHNOLOGY VALUE FUND, L.P.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

WC

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

DELAWARE

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

1,147,676*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

1,147,676*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

1,147,676*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

11.8%*

14

TYPE OF REPORTING PERSON

PN

* Excludes Shares underlying Series X Convertible Preferred Stock and Series Y Convertible Preferred Stock as described below in Item 5.

  

1

NAME OF REPORTING PERSON

BIOTECHNOLOGY VALUE FUND II, L.P.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

WC

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

DELAWARE

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

1,103,314*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

1,103,314*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

1,103,314*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

11.3%*

14

TYPE OF REPORTING PERSON

PN

* Excludes Shares underlying Series X Convertible Preferred Stock and Series Y Convertible Preferred Stock as described below in Item 5.

  

 

1

NAME OF REPORTING PERSON

BIOTECHNOLOGY VALUE TRADING FUND OS, L.P.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

WC

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

CAYMAN ISLANDS

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

159,537*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

159,537*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

159,537*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

1.6%*

14

TYPE OF REPORTING PERSON

PN

* Excludes Shares underlying Series X Convertible Preferred Stock as described below in Item 5.

  

 

1

NAME OF REPORTING PERSON

BVF PARTNERS OS LTD.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

AF

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

CAYMAN ISLANDS

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

159,537*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

159,537*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

159,537*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

1.6%*

14

TYPE OF REPORTING PERSON

CO

* Excludes Shares underlying Series X Convertible Preferred Stock as described below in Item 5.

  

 

1

NAME OF REPORTING PERSON

BVF PARTNERS L.P.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

AF

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

DELAWARE

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

2,642,405*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

2,642,405*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

2,642,405*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

27.1%*

14

TYPE OF REPORTING PERSON

PN, IA

* Excludes Shares underlying Series X Convertible Preferred Stock and Series Y Convertible Preferred Stock as described below in Item 5.

  

 

1

NAME OF REPORTING PERSON

BVF INC.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

AF

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

DELAWARE

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

2,642,405*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

2,642,405*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

2,642,405*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

27.1%*

14

TYPE OF REPORTING PERSON

CO

* Excludes Shares underlying Series X Convertible Preferred Stock and Series Y Convertible Preferred Stock as described below in Item 5.

  

 

 

1

NAME OF REPORTING PERSON

MARK N. LAMPERT

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

AF

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

USA

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

- 0 -

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

2,642,405*

PERSON WITH

9

SOLE DISPOSITIVE POWER

- 0 -

10

SHARED DISPOSITIVE POWER

2,642,405*

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

2,642,405*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

27.1%*

14

TYPE OF REPORTING PERSON

IN

* Excludes Shares underlying Series X Convertible Preferred Stock and Series Y Convertible Preferred Stock as described below in Item 5.

  

 

1

NAME OF REPORTING PERSON

MATTHEW D. PERRY

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☒

(b) ☐

3

SEC USE ONLY

4

SOURCE OF FUNDS

5

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

USA

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

32,073*

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

- 0 -

PERSON WITH

9

SOLE DISPOSITIVE POWER

32,073*

10

SHARED DISPOSITIVE POWER

- 0 -

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

32,073*

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

Less than 1%*

14

TYPE OF REPORTING PERSON

IN

* Includes 20,274 Shares issuable on the exercise of certain options that are currently exercisable.

  

The following constitutes Amendment No. 2 to the Schedule 13D filed by the undersigned (the “Amendment No. 2”). This Amendment No. 2 amends the Schedule 13D as specifically set forth herein.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended and restated to read as follows:

The Shares purchased by BVF, BVF2 and Trading Fund OS were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) in open market purchases, except as otherwise noted. The aggregate purchase price of the 1,147,676 Shares owned directly by BVF is approximately $12,950,067, including brokerage commissions. The aggregate purchase price of the 1,103,314 Shares owned directly by BVF2 is approximately $14,041,998, including brokerage commissions. The aggregate purchase price of the 159,537 Shares owned directly by Trading Fund OS is approximately $1,324,498, including brokerage commissions. The aggregate purchase price of the 231,878 Shares held in the Partners Managed Accounts is approximately $1,005,667, including brokerage commissions.

The aggregate purchase price of the 2,313 shares of Series X Convertible Preferred Stock, par value $0.05 per share (the “Series X Preferred Stock”) owned directly by BVF is approximately $9,321,390, including brokerage commissions. The aggregate purchase price of the 1,506 shares of Series X Preferred Stock owned directly by BVF2 is approximately $6,069,180, including brokerage commissions. The aggregate purchase price of the 412 shares of Series X Preferred Stock owned directly by Trading Fund OS is approximately $1,660,360, including brokerage commissions. The aggregate purchase price of the 772 shares of Series X Preferred Stock held in the Partners Managed Accounts is approximately $3,111,160, including brokerage commissions.

The aggregate purchase price of the 655.959 shares of Series Y Convertible Preferred Stock, par value $0.05 per share (the “Series Y Preferred Stock”) owned directly by BVF is approximately $8,527,467, including brokerage commissions. The aggregate purchase price of the 596.813 shares of Series Y Preferred Stock owned directly by BVF2 is approximately $7,758,569, including brokerage commissions.

The Shares beneficially owned by Mr. Perry were awarded by the Issuer in connection with his service as a director.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended to add the following:

In connection with the Issuer’s non-transferable rights offering (the “Rights Offering”) announced on November 19, 2019, certain of the Reporting Persons entered into an investment agreement, dated November 19, 2019 with the Issuer (the “Investment Agreement”). On December 2, 2019, certain of the Reporting Persons entered into a letter agreement (the “Letter Agreement”) qualifying certain terms of the Investment Agreement. The following description of the Investment Agreement and the Letter Agreement are qualified in their entirety by reference to the full text of each of the Investment Agreement, a copy of which is filed as Exhibit 10.1 to the Issuer’s Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on November 20, 2019, and the Letter Agreement, which is attached as Exhibit 99.1 hereto, and are incorporated herein by reference.

Pursuant to the Investment Agreement and the Letter Agreement, the Reporting Persons agreed to purchase from the Issuer, subject to certain conditions, Shares or shares of Series Z Convertible Preferred Stock, par value $0.05 per share (“Series Z Preferred Stock”) in an amount equal to the aggregate value of the Shares not subscribed for in the Rights Offering, at a price of $22.00 per Share or at a price per Share equal to $22,000 per share of Series Z Preferred Stock; provided, however, not to exceed 1,000,000 Shares or an equivalent number of shares of Series Z Preferred Stock (the “Backstop Commitment”). The Investment Agreement contains customary representations, warranties and covenants by the parties.

On December 18, 2019, following the expiration of the Rights Offering BVF, BVF2 and Trading Fund OS acquired 245,481 Shares, 190,899 Shares and 35,888 Shares, respectively, and pursuant to the Backstop Commitment, BVF and BVF2 acquired 207,234 Shares and 165,961 Shares, respectively.

Item 5.

Interest in Securities of the Issuer.

Items 5(a)-(c) are hereby amended and restated to read as follows:

(a)       The aggregate percentage of Shares reported owned by each person named herein is based on a denominator that is the sum of: (i) 8,757,515 Shares outstanding as of November 29, 2019, which is the total number of Shares outstanding as reported in the Issuer’s Prospectus Supplement on Form 424B5 filed with the SEC on December 2, 2019, (ii) 1,000,000 Shares issued pursuant to the Rights Offering as advised by the Issuer, and (iii) with respect to Mr. Perry, 20,274 Shares issuable on the exercise of certain options.

As of the date hereof, the Reporting Persons hold 5,003 shares of Series X Preferred Stock, convertible into an aggregate of 5,003,000 Shares. Each share of Series X Preferred Stock is convertible into 1,000 Shares. The Series X Preferred Stock may not be converted if, after such conversion, the Reporting Persons would beneficially own, as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, more than 19.99% of the Shares outstanding immediately after giving effect to such conversion (the “Series X Beneficial Ownership Limitation”). As of the date hereof, the Series X Beneficial Ownership Limitation, limits the aggregate conversion of the Series X Preferred Stock by the Reporting Persons to zero out of the 5,003,000 Shares underlying the Series X Preferred Stock.

As of the date hereof, the Reporting Persons hold 1,252.772 shares of Series Y Preferred Stock, convertible into an aggregate of 1,252,772 Shares. Each share of Series Y Preferred Stock is convertible into 1,000 Shares based on a conversion price of $13.00 per Share. The Series Y Preferred Stock may not be converted if, after such conversion, the Reporting Persons would beneficially own, as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, more than 19.99% of the Shares outstanding immediately after giving effect to such conversion (the “Series Y Beneficial Ownership Limitation”). As of the date hereof, the Series Y Beneficial Ownership Limitation, limits the aggregate conversion of the Series Y Preferred Stock by the Reporting Persons to zero out of the 1,252,772 Shares underlying the Series Y Preferred Stock.

As of the date hereof, (i) BVF beneficially owned 1,147,676 Shares, excluding 2,313,000 Shares issuable upon the conversion of certain Series X Preferred Stock and 655,959 Shares issuable upon the conversion of certain Series Y Preferred Stock, representing percentage ownership of approximately 11.8% of the Shares outstanding, (ii) BVF2 beneficially owned 1,103,314 Shares, excluding 1,506,000 Shares issuable upon the conversion of certain Series X Preferred Stock and 596,813 Shares issuable upon the conversion of certain Series Y Preferred Stock, representing percentage ownership of approximately 11.3% of the Shares outstanding, (iii) Trading Fund OS beneficially owned 159,537 Shares, excluding 412,000 Shares issuable upon the conversion of certain Series X Preferred Stock, representing percentage ownership of approximately 1.6% of the Shares outstanding, and (iv) 231,878 Shares were held in the Partners Managed Accounts, excluding 772,000 Shares issuable upon the conversion of certain Series X Preferred Stock, representing percentage ownership of approximately 2.4% of the Shares outstanding.

Partners OS, as the general partner of Trading Fund OS, may be deemed to beneficially own the 159,537 Shares, excluding 412,000 Shares issuable upon the conversion of certain Series X Preferred Stock, beneficially owned by Trading Fund OS, representing percentage ownership of approximately 1.6% of the Shares outstanding.

Partners, as the general partner of BVF, BVF2, the sole member of Partners OS and the investment manager of Trading Fund OS and the Partners Managed Accounts, may be deemed to beneficially own the 2,652,405 Shares beneficially owned in the aggregate by BVF, BVF2, Trading Fund OS, and held in the Partners Managed Accounts, excluding 5,003,000 Shares issuable upon the conversion of the Series X Preferred Stock and 1,252,772 Shares issuable upon the conversion of the Series Y Preferred Stock, representing percentage ownership of approximately 27.1% of the Shares outstanding.

BVF Inc., as the general partner of Partners, may be deemed to beneficially own the 2,652,405 Shares beneficially owned by Partners, excluding 5,003,000 Shares issuable upon the conversion of the Series X Preferred Stock and 1,252,772 Shares issuable upon the conversion of the Series Y Preferred Stock, representing percentage ownership of approximately 27.1% of the Shares outstanding.

Mr. Lampert, as a director and officer of BVF Inc. may be deemed to beneficially own the 2,652,405 Shares beneficially owned by BVF Inc., excluding 5,003,000 Shares issuable upon the conversion of the Series X Preferred Stock and 1,252,772 Shares issuable upon the conversion of the Series Y Preferred Stock, representing percentage ownership of approximately 27.1% of the Shares outstanding.

As of the date hereof, Mr. Perry beneficially owned 32,073 Shares, including 20,274 Shares issuable on the exercise of certain options that are currently exercisable, representing percentage ownership of less than 1%.

(b)       Each of BVF, BVF2 and Trading Fund OS shares with Partners voting and dispositive power over the Shares each such entity beneficially owns. Trading Fund OS shares with Partners OS, voting and dispositive power over the Shares beneficially owned by Trading Fund OS. Partners, BVF Inc. and Mr. Lampert share voting and dispositive power over the 2,652,405 Shares they may be deemed to beneficially own with BVF, BVF2, Trading Fund OS and Partners OS.

(c)       Other than Shares acquired pursuant to the Rights Offering and the Backstop Commitment, as described above in Item 4, the Reporting Persons have not entered into any transactions in the Shares during the past sixty days.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item 6 is hereby amended to add the following:

As described in Item 4 above, certain of the Reporting Persons and the Issuer entered into the Investment Agreement, a copy of which is filed as Exhibit 10.1 to the Issuer’s Form 8-K filed with the SEC on November 20, 2019, and the Letter Agreement, which is attached as Exhibit 99.1 hereto, and are incorporated herein by reference.

Item 7.

Material to be Filed as Exhibits.

Item 7 is hereby amended to add the following exhibit:

99.1

Letter Agreement, dated December 2, 2019.

99.2

Investment Agreement, dated November 19, 2019 (incorporated by reference to Exhibit 10.1 to the Issuer’s Current Report on Form 8-K filed with the SEC on November 20, 2019).

SIGNATURES

After reasonable inquiry and to the best of his or its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: December 20, 2019

 

BIOTECHNOLOGY VALUE FUND, L.P.			BVF INC.
By:	BVF Partners L.P., its general partner		By:	/s/ Mark N. Lampert
By:	BVF Inc., its general partner			Mark N. Lampert
				President
By:	/s/ Mark N. Lampert
	Mark N. Lampert
	President		/s/ Mark N. Lampert
			MARK N. LAMPERT
BIOTECHNOLOGY VALUE FUND II, L.P.
			/s/ Matthew D. Perry
By:	BVF Partners L.P., its general partner		MATTHEW D. PERRY
By:	BVF Inc., its general partner
By:	/s/ Mark N. Lampert
	Mark N. Lampert
	President
BVF PARTNERS L.P.
By:	BVF Inc., its general partner
By:	/s/ Mark N. Lampert
	Mark N. Lampert
	President
BVF PARTNERS OS LTD.
By:	BVF Partners L.P., its sole member
By:	BVF Inc., its general partner
By:	/s/ Mark N. Lampert
	Mark N. Lampert
	President
Biotechnology Value Trading Fund OS LP
By:	BVF Partners L.P., its investment manager
By:	BVF Inc., its general partner
By:	/s/ Mark N. Lampert
	Mark N. Lampert
	President