ImmunityBio, Inc. 10-Q

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS. (a) Recent Sales of Unregistered Securities In accordance with the terms of a settlement agreement reached in connection with the Altor BioScience, LLC litigation (see Note 7 , Commitments and Contingencies—Litigation ), on July 9, 2022 the company issued 2,229,296 shares of its common stock with an aggregate market value of $10.7 million, based on the closing price of its common stock on the NASDAQ as of July 8, 2022, to the appraisal petitioners pursuant to the terms of the court-approved settlement agreement. The company received no proceeds from the transaction. These shares of common stock are exempt from registration under Rule 506(b) of the Securities Act on the basis that (a) ImmunityBio, Inc. is current with its filings with the SEC under the Exchange Act, (b) each purchaser is an accredited investor, and (c) no general solicitation or advertising was used to market the shares. As previously disclosed on Form 8-K, on August 31, 2022 we added a conversion feature to outstanding fixed-rate promissory notes held by entities affiliated with Dr. Soon-Shiong allowing each lender the right at any time, including upon notice of prepayment, at its sole option, to convert the entire outstanding principal amount and accrued and unpaid interest due under each note at the time of conversion into shares of the company’s common stock at a price of $5.67 per share. As of September 30, 2022, the outstanding aggregate amount on such loans was $315.7 million, including accrued interest, which would equate to approximately 55.7 million shares of common stock to be issued upon conversion of such notes. (b) Issuer Purchases of Equity Securities None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable.