{"url_path":"/sec/rlyb/8-k/2026-06-01/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 Entry into a Material Definitive Agreement.","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-06-01","source_url":"https://www.sec.gov/Archives/edgar/data/1739410/0001193125-26-249790-index.html","accession_number":"0001193125-26-249790","cik":"0001739410","ticker":"RLYB","issuer_name":"Rallybio Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/1739410/0001193125-26-249790-index.html","primary_entity_key":"0001739410","primary_entity_name":"Rallybio Corp"},"word_count":3167,"has_tables":true,"body_markdown":"Item 1.01.\n\nEntry into a Material Definitive Agreement.\n\nMerger Agreement\n\nOn May 31, 2026, Rallybio Corporation, a Delaware corporation (“Rallybio”), entered into an Agreement and Plan of Merger and Reorganization (the “Merger Agreement”) with Avenzo Therapeutics, Inc., a Delaware corporation (“Avenzo”), a clinical-stage biotechnology company developing next-generation oncology therapies, and Farmington Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Rallybio (“Merger Sub”). Upon the terms and subject to the satisfaction of the conditions described in the Merger Agreement, Merger Sub will be merged with and into Avenzo, with Avenzo surviving as a wholly owned subsidiary of Rallybio (the “Merger” and, together with all of the other transactions contemplated by the Merger Agreement, the “Contemplated Transactions”). The Merger is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes.\n\nSubject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), (a) each then-outstanding share of common stock or preferred stock of Avenzo (each such share, an “Avenzo Share”) (excluding any share described in clauses (b) or (c) below and Avenzo Shares held by stockholders who have exercised and perfected appraisal rights for such shares) will be converted into the right to receive a number of shares of Rallybio Common Stock, par value $0.0001 per share (“Rallybio Common Stock”), calculated in accordance with the Exchange Ratio as set forth in the Merger Agreement (the “Exchange Ratio”), (b) each Avenzo Share issued in the Concurrent Financing (as defined below) will be converted into the right to receive a number of shares of Rallybio Common Stock calculated in accordance with the Merger Agreement, (c) any Avenzo Shares held as treasury shares or held or owned by Rallybio, Merger Sub or any subsidiary of Rallybio or Avenzo immediately prior to the Effective Time will be canceled and shall cease to exist, and no consideration shall be delivered in exchange therefor. Each then-outstanding option to purchase Avenzo Shares will be converted into an option to purchase Rallybio Common Stock, subject to adjustment as set forth in the Merger Agreement.\n\nUnder the Exchange Ratio formula in the Merger Agreement, upon the Closing, on a pro forma basis and based upon the number of shares of Rallybio Common Stock expected to be issued in connection with the Merger and the Concurrent Financing, pre-Merger equityholders of Avenzo (other than Investors (as defined below) in the Concurrent Financing) are expected to own approximately 56.6% of the combined company, pre-Merger equityholders of Rallybio will own approximately 2.8% of the combined company and the Investors in the Concurrent Financing are expected to own approximately 40.6% (assuming gross proceeds from the Concurrent Financing of $215.0 million), in each case, calculated on a fully diluted basis, using the treasury stock method, and subject to certain assumptions, including (i) a valuation for Rallybio of $15.0 million (assuming Rallybio has no net cash as a result of its pre-closing distributions (“Rallybio Net Cash”) as of the closing of the Merger (the “Closing” and such date, the “Closing Date”), (ii) a valuation for Avenzo of $300.0 million, and (iii) the relative capitalization of Rallybio and Avenzo. The percentage of the combined company that each party’s equityholders will own following the Closing is subject to certain adjustments as described in the Merger Agreement, including the amount of the final Rallybio Net Cash at Closing. At any time prior to the Closing, Rallybio will declare distributions (each a “Rallybio Distribution”) of Rallybio Net Cash to holders of Rallybio Common Stock and, if applicable, securities convertible into or exchangeable or exercisable for shares of Rallybio Common Stock outstanding as of the applicable record date, subject to the terms of the Merger Agreement.\n\nFollowing the Closing, it is expected that Athena Countouriotis, M.D., the Chair, President and Chief Executive Officer of Avenzo, will serve as the Chair, President and Chief Executive Officer of the combined company; Scott Lipman, M.B.A., the Chief Financial Officer and Chief Business Officer of Avenzo, will serve as the Chief Financial Officer and Chief Business Officer of the combined company; Mohammad Hirmand, M.D., the Chief Medical Officer of Avenzo, will serve as the Chief Medical Officer of the combined company; and Brian Sun, J.D., the Chief Legal Officer of Avenzo, will serve as the Chief Legal Officer of the combined company. Additionally, following the Closing, the board of directors of the combined company is expected to consist of seven directors, which members will initially be designated by the Company prior to the Closing. In connection with the Closing, each of the current Rallybio executive officers and directors are expected to tender their resignations.\n\nThe Merger Agreement contains representations and warranties of the parties regarding their respective businesses. The Merger Agreement also contains certain covenants made by each of Avenzo and Rallybio, including non-solicitation restrictions binding each party (and subject to certain exceptions as further described in the Merger Agreement) and its representatives and restrictions on the operation of each party’s business between the date of the Merger Agreement and the Closing.\n\nIn connection with the Merger, Rallybio will prepare and file a registration statement on Form S-4, which will contain a proxy statement and prospectus, to register the shares issued pursuant to the Merger Agreement (the “Form S-4”) and will seek the approval of Rallybio’s stockholders of, among other matters, (i) the issuance of the shares of Rallybio Common Stock and other securities of Rallybio pursuant to the Merger and the change of control of Rallybio resulting from the Merger, (ii) a reverse stock split of Rallybio Common Stock at a ratio to be mutually agreed upon by Rallybio and Avenzo, (iii) the change of the name of Rallybio to “Avenzo Therapeutics, Inc.” ((i) through (iii), the “Rallybio Stockholder Matters”), (iv) an increase in the number of authorized shares of Rallybio Common Stock to a number determined by Avenzo (the “Authorized Share Increase Proposal”), (v) the Avenzo 2026 Equity Incentive Plan, and (vi) the Avenzo 2026 Employee Stock Purchase Plan.\n\nIn the event the Rallybio Board of Directors makes a Parent Board Adverse Recommendation Change (as defined in the Merger Agreement) as a result of a Superior Offer (as defined in the Merger Agreement), Rallybio will remain obligated to hold the stockholder meeting to vote on the Rallybio Stockholder Matters under the terms of the Merger Agreement and may not terminate the Merger Agreement in order to enter into an agreement with respect to such Superior Offer.\n\nThe Closing is subject to certain closing conditions, including: (i) the approval by the Rallybio stockholders of the Rallybio Stockholder Matters; (ii) approval by the requisite Avenzo stockholders of the adoption and approval of the Merger Agreement and the Contemplated Transactions; (iii) the existing shares of Rallybio Common Stock having been continually listed on the Nasdaq Stock Market (including the Nasdaq Capital Market) (“Nasdaq”) and Nasdaq’s approval of the shares of Rallybio Common Stock to be issued in the Merger; (iv) the Subscription Agreement (as defined below) being in full force and effect with cash gross proceeds of not less than $215.0 million having been received by Avenzo; (v) the effectiveness of the Form S-4; (vi) determination of Rallybio Net Cash; (vii) the amount of any Rallybio Distribution declared or intended to be declared by Rallybio having been either declared, distributed or deposited with Rallybio’s transfer agent, if applicable, for further distribution on such date as determined by Parent; (viii) termination by Avenzo of certain agreements with investors; (ix) Rallybio Net Cash being greater than an amount equal to $500,000 below $0 and (x) no legal restraint. The Closing is also subject to other specified customary closing conditions of each party, including the accuracy of each party’s representations and warranties, subject to applicable materiality qualifications, compliance by each party with its covenants under the Merger Agreement in all material respects, respectively, delivery of certain customary closing documents by each of Rallybio and Avenzo, and no Avenzo material adverse effect or Rallybio material adverse effect since the date of the Merger Agreement that is continuing, respectively.\n\nThe Merger Agreement contains certain termination rights of each of Avenzo and Rallybio. Upon termination of the Merger Agreement in certain circumstances, Avenzo may be required to pay to Rallybio a termination fee of (x) $20.0 million, including (i) where Avenzo’s board of directors changes or withdraws its recommendation in favor of the Merger or recommends to enter into an alternative transaction, (ii) in certain circumstances where Avenzo enters into a Permitted Alternative Agreement (as defined in the Merger Agreement); or (iii) if (a) the Merger Agreement is terminated because Avenzo (1) fails to obtain the requisite stockholder approval of the Merger Agreement and the Contemplated Transactions or (2) breaches the Merger Agreement, (b) an alternative acquisition proposal was announced or disclosed prior to obtaining Avenzo’s stockholder approval, and (c) within 12 months of the termination of the Merger Agreement, Avenzo enters into a definitive agreement with respect to an alternative transaction; or (y) $8 million, if (i) the Merger Agreement is terminated because the Merger has not been consummated by the End Date (as defined in the Merger Agreement), (ii) an alternative acquisition proposal was announced or disclosed prior to obtaining Avenzo’s stockholder approval, and (iii) within 12 months of the termination of the Merger Agreement, Avenzo enters into a definitive agreement with respect to an alternative transaction.\n\nUpon termination of the Merger Agreement in certain circumstances, a termination fee of $600,000 may be payable by Rallybio to Avenzo if (i)(a) the Merger Agreement is terminated because the Merger has not been consummated by the End Date (as defined in the Merger Agreement) or Rallybio (1) fails to obtain the requisite stockholder approval of the Rallybio Stockholder Matters or (2) breaches the Merger Agreement, (b) an alternative acquisition proposal was announced or disclosed prior to such termination, and (c) within 12 months of the termination of the Merger\n\nAgreement, Rallybio enters into a definitive agreement with respect to an alternative transaction, (ii) Rallybio fails to include its board recommendation in the Form S-4, or (iii) the Rallybio board of directors changes or withdraws its recommendation in favor of the Merger or approves an alternative transaction, or willfully and intentionally breaches its non-solicitation or certain other obligations under the Merger Agreement. Avenzo and Rallybio have also each agreed to reimburse the other party for up to $750,000 for third-party expenses, as applicable, if the Merger Agreement is terminated in certain circumstances.\n\nSupport Agreements and Lock-Up Agreements\n\nSupport Agreements\n\nConcurrently with the execution of the Merger Agreement, the executive officers and directors and certain other stockholders of Rallybio holding approximately 24.3% of the outstanding Rallybio capital stock entered into support agreements (the “Rallybio Support Agreements”) in favor of Avenzo, providing among other things, that such officers, directors and stockholders (x) will vote all of their shares of Rallybio capital stock, among other things: (i) in favor of approving the Contemplated Transactions, including the Rallybio Stockholder Matters, the Authorized Share Increase Proposal and the other actions contemplated by the Merger Agreement, (ii) against any proposal made in opposition to, or in competition with, the Merger Agreement or the Merger and (iii) against any acquisition proposal involving a third party and (y) will not solicit or negotiate alternative acquisition proposal or inquiries in their capacities as stockholders of Rallybio.\n\nConcurrently with the execution of the Merger Agreement, certain officers, directors and stockholders of Avenzo holding approximately 78% of the outstanding Avenzo capital stock entered into support agreements (the “Avenzo Support Agreements” and, together with Rallybio Support Agreements, the “Support Agreements”) in favor of Rallybio, providing among other things, that such executive officers, directors and stockholders (x) will vote all of their shares of Avenzo capital stock, among other things: (i) in favor of adopting the Merger Agreement and approving the Merger, the other Contemplated Transactions, the Company Stockholder Matters (as defined in the Merger Agreement) and the other actions contemplated by the Merger Agreement, (ii) against any proposal made in opposition to, or in competition with, the Merger Agreement or the Merger and (iii) against any acquisition proposal involving a third party and (y) will not solicit or negotiate alternative acquisition proposal or inquiries in their capacities as stockholders of Avenzo.\n\nLock-Up Agreements\n\nConcurrently with the execution of the Merger Agreement, certain executive officers, directors and stockholders of Avenzo entered into lock-up agreements (the “Lock-Up Agreements”), pursuant to which, subject to specified exceptions, such persons accepted certain restrictions on transfers of the shares of Rallybio Common Stock beneficially held by such persons or such persons’ family members (other than shares received as a result of the conversion of shares received in the Concurrent Financing) for the 180-day period following the Effective Time.\n\nThe foregoing descriptions of the Merger Agreement, the form of Rallybio Support Agreement, form of the Avenzo Support Agreement and the form of Lock-Up Agreement (collectively, the “Agreements”), are not complete and are qualified in their entirety by reference to those Agreements, which are filed as Exhibits 2.1, 10.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and incorporated herein by reference. In particular, the assertions embodied in the representations and warranties contained in the Merger Agreement are qualified by information in confidential disclosure schedules provided by each of Rallybio and Avenzo in connection with the signing of the Merger Agreement. These confidential disclosure schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties and certain covenants set forth in the Merger Agreement. Moreover, certain representations and warranties in the Agreements were used for the purpose of allocating risk between the parties thereto rather than establishing matters as facts. Accordingly, the representations and warranties may not describe the actual state of affairs at the date they were made or at any other time, and investors should not rely on them as statements of fact.\n\nRallybio Contingent Value Rights Agreement\n\nImmediately prior to the Effective Time, Rallybio and a rights agent (the “Rights Agent”) are expected to enter into a Contingent Value Rights Agreement (the “CVR Agreement”), pursuant to which holders of record of certain Rallybio securities as of the close of business on the last business day prior to the day on which the Effective Time occurs will receive one contingent value right (each, a “CVR”) for each outstanding share of Rallybio Common Stock, pre-funded warrant, Rallybio restricted stock unit or In the Money Parent Option (as defined in the Merger Agreement) held as of such date.\n\nPursuant to the CVR Agreement, each CVR holder will be entitled to receive their pro rata share of all of the net proceeds (including cash or the value of stock to the extent listed on a national exchange, at the time of disposition), if any, received by Rallybio as a result of payments (“CVR Payments”) made to Rallybio of (i) any upfront, milestone, royalty and other payments received under any disposition agreement related to Rallybio’s pre-Merger assets (the “Legacy Assets”), and (ii) all of the cash proceeds, if any, received from Recursion Pharmaceuticals, Inc. under the Membership Interest Purchase Agreement, dated July 8, 2025, by and among Recursion Pharmaceuticals, Inc., Exscientia Ventures I, Inc., Rallybio Corporation and Rallybio IPB, LLC. For a period of four months after the Closing Date, Rallybio will use commercially reasonable efforts to effect the disposition of the Legacy Assets with respect to a third party that Rallybio had been in discussions with regarding a disposition prior to the Closing Date, subject to certain limitations. Such net proceeds will be subject to certain permitted deductions, including for applicable tax payments, certain expenses incurred or other liabilities borne by Rallybio or its affiliates in respect of the Legacy Assets, and losses incurred by Rallybio or its affiliates due to a third-party proceeding in connection with such disposition.\n\nThe CVR Payments, if any, will become payable to the Rights Agent for subsequent distribution to the CVR holders. In the event that no such proceeds are received during the CVR Term (as defined in the CVR Agreement), holders of the CVRs will not receive any payment pursuant to the CVR Agreement. There can be no assurance that any CVR holders will receive any CVR Payments.\n\nThe right to the contingent payments contemplated by the CVR Agreement is a contractual right only and is not transferable, except in the limited circumstances specified in the CVR Agreement. The CVRs will not be evidenced by a certificate or any other instrument and will not be registered with the Securities and Exchange Commission (“SEC”). The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Rallybio or any of its respective affiliates. No interest will accrue on any amounts payable in respect of the CVRs.\n\nThe foregoing summary of the CVR Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of CVR Agreement, which is filed herewith as Exhibit 10.4 and is incorporated by reference herein.\n\nConcurrent Financing\n\nConcurrently with entering into the Merger Agreement, Avenzo entered into a subscription agreement (the “Subscription Agreement”) with certain accredited investors (the “Investors”).\n\nPursuant to the Subscription Agreement, and subject to the terms and conditions therein, Avenzo agreed to sell, and the Investors agreed to purchase, immediately prior to the Effective Time, shares of Avenzo Class A common stock for an aggregate purchase price of $215.0 million (the “Concurrent Financing”). Shares of Avenzo Class A common stock issued pursuant to the Concurrent Financing will be converted into shares of Rallybio Common Stock in accordance with the Exchange Ratio and the Merger Agreement. The closing of the Concurrent Financing is anticipated to occur on or about the Closing Date, subject to the satisfaction of customary closing conditions.\n\nAvenzo and Rallybio have also agreed to enter into a registration rights agreement (the “Registration Rights Agreement”) with the Investors at the closing of the Concurrent Financing. Pursuant to the Registration Rights Agreement, the combined company will prepare and file a resale registration statement with the SEC within 30 calendar days following the closing of the Concurrent Financing. The combined company will use its reasonable best efforts to cause such registration statement to become effective as promptly as practicable.\n\nThe combined company will also agree to, among other things, indemnify the Investors, their members, shareholders, directors, officers, partners, employees, members, managers, agents, representatives and advisors under the registration statement from certain liabilities and pay all fees and expenses (excluding any legal fees of the selling holder(s), and any underwriting discounts and selling commissions) incident to the combined company’s obligations under the Registration Rights Agreement.\n\nThe foregoing descriptions of the Subscription Agreement and Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the Subscription Agreement, and the Registration Rights Agreement the forms of which are filed as Exhibits 10.5 and 10.6, respectively, to this Current Report on Form 8-K and are incorporated herein by reference."}