Filed by EQRx, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to 14a-12 under the Securities Exchange Act of 1934
Subject Company: EQRx, Inc.
Commission File No.: 001-40312
Date: August 1, 2023
This filing relates to the proposed transaction between Revolution Medicines, Inc. a Delaware corporation (Revolution Medicines), and EQRx, Inc., a Delaware corporation (EQRx), pursuant to the terms of that certain Agreement and Plan of Merger, dated as of July 31, 2023 (the Merger Agreement), by and among Revolution Medicines, EQRx, Equinox Merger Sub I, Inc., a Delaware corporation and a wholly owned subsidiary of Revolution Medicines (Merger Sub I), and Equinox Merger Sub II LLC, a Delaware limited liability company and a wholly owned subsidiary of Revolution Medicines (Merger Sub II and, together with Merger Sub I, the Merger Subs and each a Merger Sub).
On August 1, 2023, EQRx published the following communication:
Our Transaction with Revolution Medicines
Why is this transaction the best path forward for EQRx shareholders?
Following a rigorous and independent process conducted by our Board, we strongly believe that this outcome is the best option to maximize shareholder value.
Revolution Medicines has the opportunity to address one of the largest areas of unmet need in oncology. Deploying our significant capital will enhance Revolution Medicines efforts to fulfill this important vision and also provides an opportunity for EQRx shareholders to participate in the upside potential of both near-term and long-term value-creating catalysts.
Certain shareholders representing more than 40% of the voting power of EQRx, have entered into voting and support agreements to vote their shares in favor of the transaction, validating the rigor of the process of the Board and our independent transaction committee and the rationale for the transaction.
What alternatives did the EQRx Board review?
The Boards rigorous process included exploring company acquisitions or acquiring assets, licensing of clinical programs, strategic partnerships, a whole company sale, sales of certain assets and returning cash to shareholders. It carefully considered the timeline and complexities involved in a liquidation as a comparator to the proposed transaction with Revolution Medicines.
How long was the Boards process?
Over an eight-month time period, the Board and our independent transaction committee, assisted by independent financial and legal advisors, contacted or was contacted by more than 50 parties.
Further details regarding the background of the transaction will be included in our proxy statement, which will be filed with the SEC in due course.
Which directors were part of the independent transaction committee?
The independent transaction committee that oversaw the agreement with Revolution Medicines was comprised of independent directors, including Paul Berns, Jorge Conde, Kathryn Giusti, Samuel Merksamer and Krishna Yeshwant. At all times during the Boards process there were appropriate director recusals to avoid even the appearance of conflicts of interest.
How long has the transaction committee been in discussions with Revolution Medicines?
The independent transaction committee has been in discussions with Revolution Medicines over the past several weeks. Further details regarding the background of the transaction will be included in our proxy statement, which will be filed with the SEC in due course.
When will Revolution Medicines provide clinical updates on its RAS(ON) inhibitor pipeline?
Revolution Medicines has established a pioneering portfolio of programs designed to defeat RAS-addicted cancers which represent 30% of all human cancers in non-small cell lung cancer, pancreatic cancer and other areas where there is high unmet need. Revolution Medicines has disclosed that it intends to provide updates on its priority clinical-stage RAS(ON) inhibitors in the near-term:
RMC-6236: an update on the clinical antitumor activity of RMC-6236 (RASMULTI) in patients with non-small cell lung cancer (NSCLC) or pancreatic cancer will be presented as a Proffered Paper (oral presentation) at the 2023 European Society for Medical Oncology Congress (ESMO) in October, and supporting clinical data will be presented at the 2023 AACR-NCI-EORTC International Conference on Molecular Targets and Cancer Therapeutics (Triple Meeting) in October.
RMC-6291: a first report on initial clinical findings with RMC-6291 (KRASG12C), including preliminary evidence of differentiation from RAS(OFF) inhibitors, will also be presented at the Triple Meeting.
RMC-9805: Revolution Medicines announced that study site activation is ongoing under an investigational new drug (IND) application for a Phase 1/1b trial of RMC-9805 (KRASG12D).
What will happen to EQRxs remaining pipeline programs? Did the Board review alternatives for them?
The Boards rigorous process included reviewing its programs and considering alternatives for them. In line with Revolution Medicines prioritization and focus of its resources, Revolution Medicines does not intend to advance EQRxs research and development portfolio following closing of the transaction.
EQRx will commence a process to wind down these programs and return the associated intellectual property to its partners, which would have the opportunity to independently decide the next steps on development.
What are the transaction details? How was it priced?
Under the terms of the merger agreement, Revolution Medicines will acquire EQRx in an all-stock transaction. The stock exchange ratio formula in the merger agreement uses a blended formula to account for developments in Revolution Medicines ongoing business and potential movement in its stock price.
Approximately 80% of the stock exchange ratio is based on Revolution Medicines public market stock price measured in close proximity to the EQRx stockholder vote and approximately 20% of the exchange ratio is a determined price per share of Revolution Medicines stock as of the signing of the merger agreement. Specifically, at closing, EQRx stockholders will receive the number of shares of Revolution Medicines common stock equal to the sum of 7,692,308 Revolution Medicines shares (determined as $200 million divided by $26.00 per share) plus a number of shares equal to $870 million divided by a price that is a 6% discount to the 5-day volume-weighted average Revolution Medicines share price measured in close proximity to the stockholder vote.
Will EQRx receive any seats on Revolution Medicines board?
Yes, at the transaction close, one independent director from EQRx mutually agreed upon by the parties will be designated to serve on Revolution Medicines board of directors.
This communication contains forward-looking statements within the meaning of federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon current plans, estimates and expectations of management of Revolution Medicines and EQRx in light of historical results and trends, current conditions and potential future developments, and are subject to various risks and uncertainties that could cause actual results to differ materially from such statements. The inclusion of forward-looking statements should not be regarded as a representation that such plans, estimates and expectations will be achieved. Words such as anticipate, expect, project, intend, believe, may, will, should, plan, could, continue, target, contemplate, estimate, forecast, guidance, predict, possible, potential, pursue, likely, and words and terms of similar substance used in connection with any discussion of future plans, actions or events identify forward-looking statements. All statements, other than historical facts, including express or implied statements regarding the proposed transaction; the conversion of equity interests contemplated by the Merger Agreement; the issuance of common stock of Revolution Medicines contemplated by the Merger Agreement; the expected filing by Revolution Medicines of a registration statement and Joint Proxy Statement/Prospectus to be included therein; the expected timing of the closing of the proposed transaction; the ability of the parties to complete the proposed transaction considering the various closing conditions; the expected benefits of the proposed transaction; the competitive ability and position of the combined company; and any assumptions underlying any of the foregoing, are forward-looking statements. Important factors that could cause actual results to differ materially from Revolution Medicines and EQRxs plans, estimates or expectations described in such forward-looking statements could include, but are not limited to: (i) the risk that the proposed transaction may not be completed in a timely manner or at all, which may adversely affect Revolution Medicines and EQRxs businesses and the price of their respective securities; (ii) uncertainties as to the timing of the consummation of the proposed transaction; (iii) the potential failure to receive, on a timely basis or otherwise, the required approvals of the proposed transaction, including stockholder approvals by both Revolution Medicines stockholders and EQRxs stockholders, and the potential failure to satisfy the other conditions to the consummation of the transaction; (iv) that the proposed transaction may involve unexpected costs, liabilities or delays; (v) the effect of the announcement, pendency or completion of the proposed transaction on each of Revolution Medicines or EQRxs ability to attract, motivate, retain and hire key personnel and maintain relationships with customers, distributors, suppliers and others with whom Revolution Medicines or EQRx does business, or on Revolution Medicines or EQRxs operating results and business generally; (vi) that the proposed transaction may divert managements attention from each of Revolution Medicines and EQRxs ongoing business operations; (vii) the risk of any legal proceedings related to the proposed transaction or otherwise, or the impact of the proposed transaction thereupon, including resulting expense or delay; (viii) that Revolution Medicines or EQRx may be adversely affected by other economic, business and/or competitive factors; (ix) the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement relating to the proposed transaction,
including in circumstances which would require Revolution Medicines or EQRx to pay a termination fee; (x) the risk that restrictions during the pendency of the proposed transaction may impact Revolution Medicines or EQRxs ability to pursue certain business opportunities or strategic transactions; (xi) the risk that Revolution Medicines or EQRx may be unable to obtain governmental and regulatory approvals required for the proposed transaction, or that required governmental and regulatory approvals may delay the consummation of the proposed transaction or result in the imposition of conditions that could reduce the anticipated benefits from the proposed transaction or cause the parties to abandon the proposed transaction; (xii) the risk that the anticipated benefits of the proposed transaction may otherwise not be fully realized or may take longer to realize than expected; (xiii) the impact of legislative, regulatory, economic, competitive and technological changes; (xiv) risks relating to the value of Revolution Medicines securities to be issued in the proposed transaction; (xv) the risk that integration of the proposed transaction post-closing may not occur as anticipated or the combined company may not be able to achieve the growth prospects expected from the transaction; (xvi) the effect of the announcement, pendency or completion of the proposed transaction on the market price of the common stock of each of Revolution Medicines and the common stock and publicly traded warrants of EQRx; (xvii) the implementation of each of Revolution Medicines and EQRxs business model and strategic plans for product candidates and pipeline, and challenges inherent in developing, commercializing, manufacturing, launching, marketing and selling potential existing and new products; (xviii) the scope, progress, results and costs of developing Revolution Medicines and EQRxs product candidates and any future product candidates, including conducting preclinical studies and clinical trials, and otherwise related to the research and development of Revolution Medicines and EQRxs pipeline; (xix) the timing and costs involved in obtaining and maintaining regulatory approval for Revolution Medicines and EQRxs current or future product candidates, and any related restrictions, limitations and/or warnings in the label of an approved product; (xx) the market for, adoption (including rate and degree of market acceptance) and pricing and reimbursement of Revolution Medicines and EQRxs product candidates and their respective abilities to compete with therapies and procedures that are rapidly growing and evolving; (xxi) uncertainties in contractual relationships, including collaborations, partnerships, licensing or other arrangements and the performance of third-party suppliers and manufacturers; (xxii) the ability of each of Revolution Medicines and EQRx to establish and maintain intellectual property protection for products or avoid or defend claims of infringement; (xxiii) exposure to inflation, currency rate and interest rate fluctuations and risks associated with doing business locally and internationally, as well as fluctuations in the market price of each of Revolution Medicines and EQRxs traded securities; (xxiv) risks relating to competition within the industry in which each of Revolution Medicines and EQRx operate; (xxv) the unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism or outbreak of war or hostilities; (xxvi) whether the termination of EQRxs license agreements and/or discovery collaboration agreements may impact its or Revolution Medicines ability to license in additional programs in the future and the risk of delays or unforeseen costs in terminating such arrangements; (xxvii) risks that restructuring costs and charges may be greater than anticipated or incurred in different periods than anticipated; (xxviii) the risk that EQRxs restructuring efforts may adversely affect its programs and its ability to recruit and retain skilled and motivated personnel, and may be distracting to employees and management; and (xxix) the risk that EQRxs restructuring or wind-down efforts may negatively impact its business operations and reputation with or ability to serve counterparties or may take longer to realize than expected, as well as each of Revolution Medicines and EQRxs response to any of the aforementioned factors. Additional factors that may affect the future results of Revolution Medicines and EQRx are set forth in their respective filings with the U.S. Securities and Exchange Commission (the SEC), including each of Revolution Medicines and EQRxs most recently filed Annual Reports on Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the SEC, which are available on the SECs website at www.sec.gov. See in particular Item 1A of Revolution Medicines Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023 under the heading Risk Factors, and Item 1A of each of EQRxs Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023 under the headings Risk Factors. The risks and uncertainties described above and in the SEC filings cited above are not exclusive and further information concerning Revolution Medicines and EQRx and their respective businesses, including factors that potentially could materially affect their respective businesses, financial conditions or operating results, may emerge from time to time. Readers are urged to consider these factors carefully in evaluating these forward-looking statements, and not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Readers should also
carefully review the risk factors described in other documents that Revolution Medicines and EQRx file from time to time with the SEC. Except as required by law, each of Revolution Medicines and EQRx assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.
Additional Information and Where to Find It
In connection with the proposed transaction, Revolution Medicines and EQRx plan to file with the SEC and mail or otherwise provide to their respective security holders a joint proxy statement/prospectus regarding the proposed transaction (as amended or supplemented from time to time, the Joint Proxy Statement/Prospectus). INVESTORS AND REVOLUTION MEDICINES AND EQRXS RESPECTIVE SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE JOINT PROXY STATEMENT/PROSPECTUS IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE AND ANY OTHER DOCUMENTS FILED BY EACH OF REVOLUTION MEDICINES AND EQRX WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE THEREIN BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE PROPOSED TRANSACTION.
Revolution Medicines investors and security holders may obtain a free copy of the Joint Proxy Statement/Prospectus and other documents that Revolution Medicines files with the SEC (when available) from the SECs website at www.sec.gov and Revolution Medicines website at ir.revmed.com. In addition, the Joint Proxy Statement/Prospectus and other documents filed by Revolution Medicines with the SEC (when available) may be obtained from Revolution Medicines free of charge by directing a request to Eric Bonach, H/Advisors Abernathy at firstname.lastname@example.org.
EQRxs investors and security holders may obtain a free copy of the Joint Proxy Statement/Prospectus and other documents that EQRx files with the SEC (when available) from the SECs website at www.sec.gov and EQRxs website at investors.eqrx.com. In addition, the Joint Proxy Statement/Prospectus and other documents filed by EQRx with the SEC (when available) may be obtained from EQRx free of charge by directing a request to EQRxs Investor Relations at email@example.com.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, nor shall there be any offer, solicitation or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
Participants in the Solicitation
Revolution Medicines, EQRx and their respective directors, executive officers, other members of management, certain employees and other persons may be deemed to be participants in the solicitation of proxies from the security holders of Revolution Medicines and EQRx in connection with the proposed transaction. Security holders may obtain information regarding the names, affiliations and interests of Revolution Medicines directors and executive officers in Revolution Medicines Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on February 27, 2023, and Revolution Medicines definitive proxy statement on Schedule 14A for its 2023 annual meeting of stockholders, which was filed with the SEC on April 26, 2023. To the extent holdings of Revolution Medicines securities by Revolution Medicines directors and executive officers have changed since the amounts set forth in such proxy statement, such changes have been or will be reflected on subsequent Statements of Changes in Beneficial Ownership on Form 4 filed with the SEC. Security holders may obtain information regarding the names, affiliations and interests of EQRxs directors and executive officers in EQRxs Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC
on February 23, 2023, and in certain of EQRxs Current Reports on Form 8-K. To the extent holdings of EQRxs securities by EQRxs directors and executive officers have changed since the amounts set forth in such Annual Report on Form 10-K, such changes have been or will be reflected on subsequent Statements of Changes in Beneficial Ownership on Form 4 filed with the SEC. Additional information regarding the interests of such individuals in the proposed transaction will be included in the Joint Proxy Statement/Prospectus relating to the proposed transaction when it is filed with the SEC. These documents (when available) may be obtained free of charge from the SECs website at www.sec.gov, Revolution Medicines website at www.revmed.com and EQRxs website at www.eqrx.com.