1013-00002 · Client 1013 · Correspondence

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CONFIDENTIAL

CALDERWOOD & HARKNESS LLP 600 California Street, 40th Floor San Francisco, CA 94108 Telephone: (415) 772-8000 Facsimile: (415) 772-8001 www.calderwoodharkness.com

Client Matter No. 1013-00002

April 22, 2024

Priya Raghunathan, J.D. General Counsel & Corporate Secretary Genome Dx Therapeutics Inc. 450 Pinnacle Drive, Suite 300 South San Francisco, CA 94080

Re: Closing of $40,000,000 Senior Unsecured Convertible Promissory Note Placement by Genome Dx Therapeutics Inc.

Dear Priya:

We are pleased to provide this post-closing letter in connection with the private placement of senior unsecured convertible promissory notes by Genome Dx Therapeutics Inc. (the "Company"). This letter is intended to serve as a comprehensive summary of the closing proceedings, the deliverables exchanged, the key terms of the transaction, and the Company's post-closing obligations. We recommend that this letter be retained alongside the closing binder in the Company's permanent corporate records for ease of reference.

1. Confirmation of Closing

We are pleased to confirm that the closing of the convertible promissory note placement (the "Closing") occurred on April 22, 2024 (the "Closing Date"). As you are aware, the original target closing date had been April 12, 2024. The Closing was delayed by ten calendar days to April 22, 2024 due to two procedural matters that arose during the final stage of the closing process: (i) the need for an updated officers' certificate to reflect final revisions to the disclosure schedules negotiated between the parties during the week of April 8, 2024, and (ii) the requirement to obtain a refreshed Certificate of Good Standing from the Secretary of State of the State of Delaware, as the original certificate had aged beyond ten business days and no longer satisfied the condition set forth in Section 6.1(e) of the Note Purchase Agreement. Both conditions were satisfied prior to the Closing Date, and the Closing proceeded without further delay.

At the Closing, the Company issued an aggregate principal amount of Forty Million Dollars ($40,000,000) in Senior Unsecured Convertible Promissory Notes (individually, a "Note" and collectively, the "Notes") to the following purchasers (each, a "Purchaser" and collectively, the "Purchasers") pursuant to that certain Note Purchase Agreement dated April 9, 2024, among the Company and the Purchasers (the "NPA"):

The Notes were issued in a private placement exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and Rule 506(b) of Regulation D promulgated thereunder. Each Purchaser represented and warranted in its respective accredited investor questionnaire and in the NPA that it qualifies as an "accredited investor" within the meaning of Rule 501(a) of Regulation D, and no general solicitation or general advertising was employed in connection with the offering.

The aggregate purchase price of $40,000,000 was received via wire transfer on the Closing Date. In accordance with the Funds Flow Memorandum dated April 22, 2024, each Purchaser's wire was directed to the escrow account established at Meridian Pacific Bank, N.A. (Trust Account No. 7841-0093-22). Upon confirmation of satisfaction of all conditions to closing as set forth in Article VI of the NPA—including receipt of all closing certificates, the legal opinion, good-standing certificates, and executed transaction documents—the escrow agent released the full $40,000,000 to the Company's operating account at Meridian Pacific Bank, N.A., as identified in the Funds Flow Memorandum. Wire transfer confirmations for each Purchaser's funds were received and are included in the closing deliverables.

2. Summary of Closing Deliverables

Set forth below is a complete list of all documents executed and delivered at or prior to the Closing. Copies of each of these documents will be included in the closing binder to be prepared and distributed by this firm as described in Section 5.3 below.

2.1 Transaction Documents

(a) Note Purchase Agreement. Note Purchase Agreement dated April 9, 2024, by and among the Company and each of the Purchasers identified therein (execution version, including all exhibits and schedules thereto).

(b) Senior Unsecured Convertible Promissory Notes. Three (3) Senior Unsecured Convertible Promissory Notes, each dated April 22, 2024, issued by the Company to the following Purchasers in the following principal amounts:

(i) Note No. CDN-001, issued to Pinnacle BioVentures Fund III, L.P., in the principal amount of $22,000,000;

(ii) Note No. CDN-002, issued to Cormorant Health Capital Partners, L.P., in the principal amount of $12,000,000; and

(iii) Note No. CDN-003, issued to Alder Creek Life Sciences Fund II, L.P., in the principal amount of $6,000,000.

(c) Disclosure Schedules. Disclosure Schedules to the Note Purchase Agreement, as finalized on April 19, 2024, and delivered by the Company to the Purchasers in connection with the Closing (reflecting the final revisions referenced in Section 1 above).

2.2 Company Closing Certificates and Resolutions

(a) Written Consent of the Board of Directors. Written Consent of the Board of Directors of the Company dated April 5, 2024, adopted in lieu of a meeting pursuant to Section 141(f) of the Delaware General Corporation Law, approving (i) the execution, delivery, and performance by the Company of the NPA and the Notes, (ii) the issuance of the Notes to the Purchasers, and (iii) the other transactions contemplated by the NPA. The Written Consent reflects the recusal of Jonathan Merriweather, a member of the Board, from all deliberations and the vote on the transaction, due to his affiliation with Pinnacle BioVentures Fund III, L.P. in its capacity as lead investor in the placement.

(b) Officers' Certificate. Officers' Certificate dated April 22, 2024, executed by Dr. Marcus Avellino, in his capacity as Chief Executive Officer, and Diane Kowalski, in her capacity as Chief Financial Officer, certifying as of the Closing Date (i) the accuracy of the representations and warranties of the Company set forth in Article III of the NPA as of the date of the NPA and as of the Closing Date (except for representations and warranties that speak as of a specific date, which were certified as accurate as of such date), (ii) the satisfaction of all conditions to the Closing set forth in Article VI of the NPA, and (iii) the absence of any material adverse change in the business, assets, condition (financial or otherwise), or results of operations of the Company since December 31, 2023.

(c) Secretary's Certificate. Secretary's Certificate dated April 22, 2024, executed by Priya Raghunathan, in her capacity as Corporate Secretary, attaching and certifying true and complete copies of (i) the Company's Restated Certificate of Incorporation, as amended through the date thereof, (ii) the Company's Amended and Restated Bylaws, as in effect on the Closing Date, and (iii) the Written Consent of the Board of Directors referenced in paragraph (a) above. The Secretary's Certificate further certifies the incumbency and specimen signatures of Dr. Marcus Avellino (Chief Executive Officer), Diane Kowalski (Chief Financial Officer), and Priya Raghunathan (General Counsel and Corporate Secretary).

2.3 Good Standing Certificates

(a) Delaware Good Standing Certificate. Certificate of Good Standing for the Company issued by the Secretary of State of the State of Delaware, dated April 17, 2024 (the refreshed certificate obtained to replace the original certificate dated March 29, 2024, which had aged beyond the ten-business-day requirement under the NPA).

(b) California Good Standing Certificate. Certificate of Good Standing (Certificate of Status) for the Company issued by the Secretary of State of the State of California, dated April 10, 2024.

2.4 Legal Opinion

(a) Legal Opinion of Calderwood & Harkness LLP. Legal Opinion of Calderwood & Harkness LLP dated April 22, 2024, addressed to each of the Purchasers and delivered by Theodore Langston, Partner, on behalf of the firm, in accordance with Section 6.1(f) of the NPA. The opinion covers the following matters: (i) due organization, valid existence, and good standing of the Company in the State of Delaware and qualification to do business in the State of California; (ii) corporate power and authority of the Company to execute, deliver, and perform its obligations under the NPA and the Notes; (iii) due authorization, execution, and delivery of the NPA and the Notes by the Company; (iv) enforceability of the NPA and the Notes against the Company in accordance with their respective terms, subject to customary exceptions and qualifications; (v) no conflicts with the Company's certificate of incorporation, bylaws, or, to our knowledge, any material agreement or applicable law; (vi) availability of the exemption from registration under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D for the offer and sale of the Notes; and (vii) no governmental approvals, consents, or filings required in connection with the execution and delivery of the NPA and the Notes, other than the post-closing filings described herein. The opinion is subject to customary assumptions, limitations, and qualifications as set forth therein.

2.5 Other Deliverables

(a) Funds Flow Memorandum. Funds Flow Memorandum dated April 22, 2024, setting forth wire instructions for the Purchasers' funding into the Meridian Pacific Bank, N.A. escrow account and the subsequent release of funds to the Company's operating account.

(b) Wire Transfer Confirmations. Wire transfer confirmations received from each of the three Purchasers evidencing the transfer of funds to the escrow account in the amounts set forth in Section 1 above.

(c) Accredited Investor Questionnaires. Accredited investor questionnaires completed and executed by each Purchaser, confirming such Purchaser's status as an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the Securities Act.

(d) Compiled Signature Pages. Compiled signature pages for all transaction documents, including the NPA, each Note, and all certificates delivered in connection with the Closing.

3. Summary of Key Transaction Terms

For the Company's convenient reference, we set forth below a brief summary of the key economic and structural terms of the Notes as set forth in the NPA and the Notes. This summary is qualified in its entirety by reference to the actual terms and conditions of the NPA and the Notes, which should be consulted for the complete terms of the transaction.

Interest Rate. The Notes bear interest at a rate of 6.0% per annum, calculated on the basis of simple interest and a 365-day year. Interest is payable in kind ("PIK") by capitalizing all accrued and unpaid interest to the outstanding principal amount of each Note on each anniversary of the date of issuance. No cash interest payments are required during the term of the Notes.

Maturity Date. The Notes mature on April 12, 2027, which is thirty-six (36) months from the original target Closing Date of April 12, 2024 (the "Maturity Date"). All outstanding principal and accrued but uncapitalized interest shall be due and payable on the Maturity Date, unless the Notes have been previously converted or repaid in accordance with their terms.

Automatic Conversion upon Qualified Financing. The outstanding principal and all accrued and unpaid interest under the Notes shall automatically convert into shares of the equity securities issued in a Qualified Financing. A "Qualified Financing" is defined in the NPA as an equity financing of the Company in which the Company raises at least $50,000,000 in aggregate gross proceeds, inclusive of the conversion of the principal and accrued interest under the Notes. Upon a Qualified Financing, the Notes shall convert at a conversion price per share equal to the lesser of:

(i) 80% of the per-share price paid by the new investors in the Qualified Financing (representing a 20% discount to the Qualified Financing price); or

(ii) the Valuation Cap Price of $4.1451 per share, which is calculated by dividing the pre-money valuation cap of $200,000,000 by 48,250,000 fully diluted shares of the Company's capital stock (as defined in and calculated pursuant to Section 1.1 of the NPA).

Voluntary Conversion at Maturity. If the Notes have not been previously converted pursuant to a Qualified Financing, each holder of a Note shall have the right, at the Maturity Date, to elect either (A) conversion of its Note into shares of the Company's common stock at the Valuation Cap Price of $4.1451 per share, or (B) repayment in cash of all outstanding principal and accrued and unpaid interest under its Note.

Change of Control. In the event of a Change of Control (as defined in the NPA), each holder of a Note may elect to receive repayment in cash of an amount equal to 1.5 times (1.5x) the outstanding principal amount of its Note, plus all accrued and unpaid interest thereon.

Majority Holder Threshold. Certain actions, consents, and waivers under the NPA and the Notes require the approval of the "Majority Holders," defined as holders of Notes representing more than 50% of the aggregate outstanding principal amount of all Notes (i.e., holders of Notes with aggregate outstanding principal in excess of $20,000,000 as of the Closing Date). The Company should note that, as of the Closing Date, Pinnacle BioVentures Fund III, L.P. alone holds $22,000,000 in aggregate principal amount, which exceeds the Majority Holder threshold.

4. Use of Proceeds Reminder

As set forth in Section 5.14 of the NPA, and as described in the Company's representations to the Purchasers during the course of the transaction, the Company intends to apply the $40,000,000 in net proceeds from the issuance of the Notes substantially as follows:

(a) Phase 2b Clinical Trial for GDT-4187 — Approximately $28,000,000 (70%). The Company intends to allocate approximately $28,000,000 to fund the continuation and expansion of its ongoing Phase 2b clinical trial for GDT-4187, the Company's lead product candidate. GDT-4187 is a selective CDK9/FLT3 dual kinase inhibitor being developed for the second-line treatment of refractory non-small cell lung cancer ("NSCLC"). The Phase 2b trial is a multi-center, randomized, double-blind, placebo-controlled study enrolling approximately 280 patients across 22 clinical sites in 8 states. Based on current enrollment projections, topline data from the Phase 2b trial is expected in the first quarter of 2025.

(b) Preclinical Development of GDT-5201 — Approximately $7,000,000 (17.5%). The Company intends to allocate approximately $7,000,000 to the preclinical development of GDT-5201, the Company's next-generation PROTAC (Proteolysis Targeting Chimera) degrader program. These funds are expected to support IND-enabling studies and related preclinical activities through the anticipated IND filing date.

(c) General Corporate Purposes and Working Capital — Approximately $5,000,000 (12.5%). The Company intends to allocate the remaining approximately $5,000,000 for general corporate purposes and working capital needs, including general and administrative expenses, capital expenditures, and other ordinary course operating expenses.

We remind the Company that any material deviation from the intended use of proceeds as described above should be discussed in advance with counsel and, as applicable, with the holders of the Notes, particularly in light of the negative covenant obligations described in Section 5.2 below.

5. Post-Closing Obligations

The Company has a number of important post-closing obligations arising under the NPA, the Notes, and applicable federal and state securities laws. We summarize these obligations below and recommend that the Company promptly implement internal procedures to ensure timely compliance with each.

5.1 Securities Filings

(a) Form D Filing with the SEC. Pursuant to Rule 503 of Regulation D under the Securities Act, the Company is required to file a notice on Form D with the U.S. Securities and Exchange Commission (the "SEC") within fifteen (15) calendar days after the first sale of securities made in reliance on the Rule 506(b) exemption. The first sale of the Notes occurred on April 22, 2024, establishing a filing deadline of May 7, 2024. We recommend that the Form D be filed as promptly as practicable following the Closing, and we have targeted a filing date of April 24, 2024. Calderwood & Harkness LLP will prepare and file the Form D on the Company's behalf using the Company's existing SEC EDGAR credentials. We will circulate a draft of the Form D to you for review prior to filing.

(b) State Blue Sky / Notice Filings. In addition to the federal Form D filing, the Company is required to make notice filings under applicable state "blue sky" laws in connection with the private placement. Based on the jurisdictions of the Purchasers and the Company's places of business, the following state notice filings are required:

(i) California. A notice filing under Section 25102(f) of the California Corporations Code is required to be made with the California Department of Financial Protection and Innovation. This filing must be made within fifteen (15) days of the first sale of securities in California. The applicable filing fee will be calculated based on the aggregate offering amount.

(ii) New York. A notice filing is required with the New York State Department of Law. This filing should be made promptly after closing.

(iii) Massachusetts. A notice filing is required with the Massachusetts Securities Division. This filing should be made promptly after closing.

(iv) Delaware. A notice filing is required with the Delaware Division of Securities. This filing should be made promptly after closing.

Calderwood & Harkness LLP will coordinate the preparation and filing of all applicable state blue sky notice filings on the Company's behalf. We will advise the Company of any filing fees due in connection with these filings.

5.2 Ongoing Covenant Compliance

The NPA imposes a number of ongoing affirmative and negative covenants on the Company for the duration that the Notes remain outstanding. The Company should carefully review Article V of the NPA for the complete terms of these covenants. We highlight the following key obligations for your attention:

(a) Information Rights. The Company has agreed to furnish to each holder of a Note the following financial and operating information on a regular basis:

(i) Quarterly Financial Statements. Unaudited financial statements (balance sheet, income statement, and statement of cash flows) for each fiscal quarter, to be delivered within forty-five (45) days after the end of each fiscal quarter. The first quarterly delivery obligation will arise in connection with the quarter ending June 30, 2024, with a delivery deadline of August 14, 2024.

(ii) Annual Financial Statements. Audited financial statements for each fiscal year, prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and audited by the Company's independent auditors, Baxter & Calloway, CPAs. These statements must be delivered within one hundred twenty (120) days after the end of each fiscal year. The first annual delivery obligation will arise in connection with the fiscal year ending December 31, 2024, with a delivery deadline of April 30, 2025.

(iii) Monthly Cash Burn Reports. Monthly reports setting forth the Company's cash position, cash burn rate, and projected cash runway, to be delivered to each holder on a monthly basis, within fifteen (15) days of the end of each calendar month.

We recommend that the Company establish internal calendar reminders and delivery protocols in coordination with the office of Chief Financial Officer Diane Kowalski to ensure that all information rights deliverables are prepared and distributed within the contractually required timeframes. Failure to timely deliver required financial information could, under certain circumstances, give rise to an Event of Default under Section 7.1 of the NPA.

(b) Negative Covenants — Majority Holder Consent Required. We remind the Company that, pursuant to Section 5.8 of the NPA, the following actions require the prior written consent of the Majority Holders (defined as holders of Notes representing more than 50% of the aggregate outstanding principal amount of all Notes, i.e., holders of Notes with aggregate outstanding principal in excess of $20,000,000 as of the Closing Date). As noted in Section 3 above, Pinnacle BioVentures Fund III, L.P. alone holds $22,000,000 in aggregate principal amount, which exceeds the Majority Holder threshold and thereby has the ability to act unilaterally as the Majority Holder:

(i) The incurrence of additional indebtedness by the Company in an aggregate amount in excess of $2,000,000 (excluding trade payables and other obligations incurred in the ordinary course of business);

(ii) The granting of any lien, security interest, mortgage, pledge, or other encumbrance on any material assets of the Company;

(iii) The declaration or payment of any dividend or other distribution to holders of the Company's equity securities;

(iv) The entry into, or consummation of, any Change of Control transaction (as defined in the NPA); and

(v) The issuance of any equity securities or equity-linked securities of the Company, other than issuances pursuant to the Company's existing 2018 Equity Incentive Plan up to the current plan reserve of 3,500,000 shares.

The Company should implement internal controls to ensure that no action described above is undertaken without first obtaining the prior written consent of the Majority Holders. We recommend that any proposed action potentially falling within the scope of these negative covenants be reviewed with counsel before proceeding.

(c) Most Favored Nation (MFN) Provision. Pursuant to Section 5.12 of the NPA, if the Company issues any convertible debt securities on terms more favorable to the holders thereof than the terms of the Notes at any time during the twelve (12) month period following the Closing Date (i.e., through and including April 22, 2025), each holder of a Note shall have the right, upon written notice to the Company, to elect to amend such holder's Note to incorporate such more favorable terms. This "most favored nation" provision applies broadly to all economic and structural terms of any such convertible debt issuance, including, without limitation, interest rate, discount rate, valuation cap, maturity, conversion mechanics, and change of control provisions.

The Company should consult with Calderwood & Harkness LLP prior to commencing any discussions or negotiations regarding, or entering into any agreements with respect to, any potential convertible debt issuance during the MFN period to ensure compliance with this provision and to evaluate the potential impact on the existing Notes and their holders.

5.3 Closing Binder

Calderwood & Harkness LLP will prepare and deliver a complete closing binder containing all executed transaction documents, certificates, opinions, good-standing certificates, wire transfer confirmations, and ancillary materials relating to the Closing. The closing binder will be delivered in both electronic format (via secure file transfer) and as a bound hard copy. We anticipate delivery of the closing binder within approximately ten (10) business days following the Closing Date.

We recommend that the Company retain the closing binder in its permanent corporate records, along with this post-closing letter, for ease of reference in connection with future financings, audits, and compliance matters. Copies of the closing binder will also be distributed to the Purchasers' counsel, Whitfield, Greer & Cavanaugh LLP, to the attention of Elizabeth Hargrove, Partner, at the address set forth in Section 6 below.

6. Investors' Counsel

For the Company's records, we note that Whitfield, Greer & Cavanaugh LLP ("WGC") represented the Purchasers as a group in connection with this transaction. The principal contacts at WGC were Elizabeth Hargrove, Partner, and James Petrosian, Senior Associate. WGC's offices are located at 1251 Avenue of the Americas, 34th Floor, New York, NY 10020. Copies of all closing deliverables, including the executed transaction documents and the closing binder, will be circulated to WGC at the address noted above.

7. Our Continuing Availability

Calderwood & Harkness LLP remains available to assist the Company with any questions regarding the transaction documents, interpretation of the NPA or the Notes, post-closing compliance obligations, securities filings, or any future financing matters that may arise. We encourage the Company to contact us in advance of any action that may implicate the covenants or other provisions of the NPA and the Notes, including, without limitation, any potential additional debt issuance, equity financing, or strategic transaction.

The primary contacts at our firm for matters relating to this transaction are:

Theodore Langston, Partner (responsible partner) Telephone: (415) 772-8125

Email: tlangston@calderwoodharkness.com

Audrey Zhou, Associate (lead associate) Telephone: (415) 772-8247

Email: azhou@calderwoodharkness.com

Both Ted and Audrey are available at your convenience to address any questions or requests that may arise.

8. Acknowledgment and Gratitude

On behalf of the entire Calderwood & Harkness team, we would like to extend our sincere thanks to you, to Dr. Marcus Avellino, and to Diane Kowalski for your collaboration and responsiveness throughout the course of this transaction. We recognize that the ten-day delay in the Closing required additional coordination and diligence on the part of the Company's team, and we appreciate the efficient manner in which the updated officers' certificate and disclosure schedule revisions were finalized.

We congratulate the Company on the successful completion of this $40,000,000 convertible note placement. The funding secured through this transaction will be instrumental in advancing the Company's Phase 2b clinical trial for GDT-4187 and its broader pipeline. We look forward to supporting Genome Dx Therapeutics as it continues to pursue its mission of developing transformative therapies for patients with serious unmet medical needs.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Theodore Langston, Partner Capital Markets Group 600 California Street, 40th Floor San Francisco, CA 94108

cc: Dr. Marcus Avellino, Ph.D., MBA, Chief Executive Officer, Genome Dx Therapeutics Inc. cc: Diane Kowalski, CPA, Chief Financial Officer, Genome Dx Therapeutics Inc. cc: Vivienne St. Claire, Partner, Calderwood & Harkness LLP cc: Audrey Zhou, Associate, Calderwood & Harkness LLP cc: Brendan Walsh, Associate, Calderwood & Harkness LLP

Purchaser	Principal Amount	Percentage of Placement
Pinnacle BioVentures Fund III, L.P.	$22,000,000	55.0%
Cormorant Health Capital Partners, L.P.	$12,000,000	30.0%
Alder Creek Life Sciences Fund II, L.P.	$6,000,000	15.0%
Total	$40,000,000	100.0%

CONFIDENTIAL
CALDERWOOD & HARKNESS LLP 600 California Street, 40th Floor San Francisco, CA 94108 Telephone: (415) 772-8000 Facsimile: (415) 772-8001 www.calderwoodharkness.com
Client Matter No. 1013-00002
April 22, 2024
Priya Raghunathan, J.D. General Counsel & Corporate Secretary Genome Dx Therapeutics Inc. 450 Pinnacle Drive, Suite 300 South San Francisco, CA 94080
Re: Closing of $40,000,000 Senior Unsecured Convertible Promissory Note Placement by Genome Dx Therapeutics Inc.
Dear Priya:
We are pleased to provide this post-closing letter in connection with the private placement of senior unsecured convertible promissory notes by Genome Dx Therapeutics Inc. (the "Company"). This letter is intended to serve as a comprehensive summary of the closing proceedings, the deliverables exchanged, the key terms of the transaction, and the Company's post-closing obligations. We recommend that this letter be retained alongside the closing binder in the Company's permanent corporate records for ease of reference.
1. Confirmation of Closing
We are pleased to confirm that the closing of the convertible promissory note placement (the "Closing") occurred on April 22, 2024 (the "Closing Date"). As you are aware, the original target closing date had been April 12, 2024. The Closing was delayed by ten calendar days to April 22, 2024 due to two procedural matters that arose during the final stage of the closing process: (i) the need for an updated officers' certificate to reflect final revisions to the disclosure schedules negotiated between the parties during the week of April 8, 2024, and (ii) the requirement to obtain a refreshed Certificate of Good Standing from the Secretary of State of the State of Delaware, as the original certificate had aged beyond ten business days and no longer satisfied the condition set forth in Section 6.1(e) of the Note Purchase Agreement. Both conditions were satisfied prior to the Closing Date, and the Closing proceeded without further delay.
At the Closing, the Company issued an aggregate principal amount of Forty Million Dollars ($40,000,000) in Senior Unsecured Convertible Promissory Notes (individually, a "Note" and collectively, the "Notes") to the following purchasers (each, a "Purchaser" and collectively, the "Purchasers") pursuant to that certain Note Purchase Agreement dated April 9, 2024, among the Company and the Purchasers (the "NPA"):
The Notes were issued in a private placement exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and Rule 506(b) of Regulation D promulgated thereunder. Each Purchaser represented and warranted in its respective accredited investor questionnaire and in the NPA that it qualifies as an "accredited investor" within the meaning of Rule 501(a) of Regulation D, and no general solicitation or general advertising was employed in connection with the offering.
The aggregate purchase price of $40,000,000 was received via wire transfer on the Closing Date. In accordance with the Funds Flow Memorandum dated April 22, 2024, each Purchaser's wire was directed to the escrow account established at Meridian Pacific Bank, N.A. (Trust Account No. 7841-0093-22). Upon confirmation of satisfaction of all conditions to closing as set forth in Article VI of the NPA—including receipt of all closing certificates, the legal opinion, good-standing certificates, and executed transaction documents—the escrow agent released the full $40,000,000 to the Company's operating account at Meridian Pacific Bank, N.A., as identified in the Funds Flow Memorandum. Wire transfer confirmations for each Purchaser's funds were received and are included in the closing deliverables.
2. Summary of Closing Deliverables
Set forth below is a complete list of all documents executed and delivered at or prior to the Closing. Copies of each of these documents will be included in the closing binder to be prepared and distributed by this firm as described in Section 5.3 below.
2.1 Transaction Documents
(a) Note Purchase Agreement. Note Purchase Agreement dated April 9, 2024, by and among the Company and each of the Purchasers identified therein (execution version, including all exhibits and schedules thereto).
(b) Senior Unsecured Convertible Promissory Notes. Three (3) Senior Unsecured Convertible Promissory Notes, each dated April 22, 2024, issued by the Company to the following Purchasers in the following principal amounts:
(i) Note No. CDN-001, issued to Pinnacle BioVentures Fund III, L.P., in the principal amount of $22,000,000;
(ii) Note No. CDN-002, issued to Cormorant Health Capital Partners, L.P., in the principal amount of $12,000,000; and
(iii) Note No. CDN-003, issued to Alder Creek Life Sciences Fund II, L.P., in the principal amount of $6,000,000.
(c) Disclosure Schedules. Disclosure Schedules to the Note Purchase Agreement, as finalized on April 19, 2024, and delivered by the Company to the Purchasers in connection with the Closing (reflecting the final revisions referenced in Section 1 above).
2.2 Company Closing Certificates and Resolutions
(a) Written Consent of the Board of Directors. Written Consent of the Board of Directors of the Company dated April 5, 2024, adopted in lieu of a meeting pursuant to Section 141(f) of the Delaware General Corporation Law, approving (i) the execution, delivery, and performance by the Company of the NPA and the Notes, (ii) the issuance of the Notes to the Purchasers, and (iii) the other transactions contemplated by the NPA. The Written Consent reflects the recusal of Jonathan Merriweather, a member of the Board, from all deliberations and the vote on the transaction, due to his affiliation with Pinnacle BioVentures Fund III, L.P. in its capacity as lead investor in the placement.
(b) Officers' Certificate. Officers' Certificate dated April 22, 2024, executed by Dr. Marcus Avellino, in his capacity as Chief Executive Officer, and Diane Kowalski, in her capacity as Chief Financial Officer, certifying as of the Closing Date (i) the accuracy of the representations and warranties of the Company set forth in Article III of the NPA as of the date of the NPA and as of the Closing Date (except for representations and warranties that speak as of a specific date, which were certified as accurate as of such date), (ii) the satisfaction of all conditions to the Closing set forth in Article VI of the NPA, and (iii) the absence of any material adverse change in the business, assets, condition (financial or otherwise), or results of operations of the Company since December 31, 2023.
(c) Secretary's Certificate. Secretary's Certificate dated April 22, 2024, executed by Priya Raghunathan, in her capacity as Corporate Secretary, attaching and certifying true and complete copies of (i) the Company's Restated Certificate of Incorporation, as amended through the date thereof, (ii) the Company's Amended and Restated Bylaws, as in effect on the Closing Date, and (iii) the Written Consent of the Board of Directors referenced in paragraph (a) above. The Secretary's Certificate further certifies the incumbency and specimen signatures of Dr. Marcus Avellino (Chief Executive Officer), Diane Kowalski (Chief Financial Officer), and Priya Raghunathan (General Counsel and Corporate Secretary).
2.3 Good Standing Certificates
(a) Delaware Good Standing Certificate. Certificate of Good Standing for the Company issued by the Secretary of State of the State of Delaware, dated April 17, 2024 (the refreshed certificate obtained to replace the original certificate dated March 29, 2024, which had aged beyond the ten-business-day requirement under the NPA).
(b) California Good Standing Certificate. Certificate of Good Standing (Certificate of Status) for the Company issued by the Secretary of State of the State of California, dated April 10, 2024.
2.4 Legal Opinion
(a) Legal Opinion of Calderwood & Harkness LLP. Legal Opinion of Calderwood & Harkness LLP dated April 22, 2024, addressed to each of the Purchasers and delivered by Theodore Langston, Partner, on behalf of the firm, in accordance with Section 6.1(f) of the NPA. The opinion covers the following matters: (i) due organization, valid existence, and good standing of the Company in the State of Delaware and qualification to do business in the State of California; (ii) corporate power and authority of the Company to execute, deliver, and perform its obligations under the NPA and the Notes; (iii) due authorization, execution, and delivery of the NPA and the Notes by the Company; (iv) enforceability of the NPA and the Notes against the Company in accordance with their respective terms, subject to customary exceptions and qualifications; (v) no conflicts with the Company's certificate of incorporation, bylaws, or, to our knowledge, any material agreement or applicable law; (vi) availability of the exemption from registration under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D for the offer and sale of the Notes; and (vii) no governmental approvals, consents, or filings required in connection with the execution and delivery of the NPA and the Notes, other than the post-closing filings described herein. The opinion is subject to customary assumptions, limitations, and qualifications as set forth therein.
2.5 Other Deliverables
(a) Funds Flow Memorandum. Funds Flow Memorandum dated April 22, 2024, setting forth wire instructions for the Purchasers' funding into the Meridian Pacific Bank, N.A. escrow account and the subsequent release of funds to the Company's operating account.
(b) Wire Transfer Confirmations. Wire transfer confirmations received from each of the three Purchasers evidencing the transfer of funds to the escrow account in the amounts set forth in Section 1 above.
(c) Accredited Investor Questionnaires. Accredited investor questionnaires completed and executed by each Purchaser, confirming such Purchaser's status as an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the Securities Act.
(d) Compiled Signature Pages. Compiled signature pages for all transaction documents, including the NPA, each Note, and all certificates delivered in connection with the Closing.
3. Summary of Key Transaction Terms
For the Company's convenient reference, we set forth below a brief summary of the key economic and structural terms of the Notes as set forth in the NPA and the Notes. This summary is qualified in its entirety by reference to the actual terms and conditions of the NPA and the Notes, which should be consulted for the complete terms of the transaction.
Interest Rate. The Notes bear interest at a rate of 6.0% per annum, calculated on the basis of simple interest and a 365-day year. Interest is payable in kind ("PIK") by capitalizing all accrued and unpaid interest to the outstanding principal amount of each Note on each anniversary of the date of issuance. No cash interest payments are required during the term of the Notes.
Maturity Date. The Notes mature on April 12, 2027, which is thirty-six (36) months from the original target Closing Date of April 12, 2024 (the "Maturity Date"). All outstanding principal and accrued but uncapitalized interest shall be due and payable on the Maturity Date, unless the Notes have been previously converted or repaid in accordance with their terms.
Automatic Conversion upon Qualified Financing. The outstanding principal and all accrued and unpaid interest under the Notes shall automatically convert into shares of the equity securities issued in a Qualified Financing. A "Qualified Financing" is defined in the NPA as an equity financing of the Company in which the Company raises at least $50,000,000 in aggregate gross proceeds, inclusive of the conversion of the principal and accrued interest under the Notes. Upon a Qualified Financing, the Notes shall convert at a conversion price per share equal to the lesser of:
(i) 80% of the per-share price paid by the new investors in the Qualified Financing (representing a 20% discount to the Qualified Financing price); or
(ii) the Valuation Cap Price of $4.1451 per share, which is calculated by dividing the pre-money valuation cap of $200,000,000 by 48,250,000 fully diluted shares of the Company's capital stock (as defined in and calculated pursuant to Section 1.1 of the NPA).
Voluntary Conversion at Maturity. If the Notes have not been previously converted pursuant to a Qualified Financing, each holder of a Note shall have the right, at the Maturity Date, to elect either (A) conversion of its Note into shares of the Company's common stock at the Valuation Cap Price of $4.1451 per share, or (B) repayment in cash of all outstanding principal and accrued and unpaid interest under its Note.
Change of Control. In the event of a Change of Control (as defined in the NPA), each holder of a Note may elect to receive repayment in cash of an amount equal to 1.5 times (1.5x) the outstanding principal amount of its Note, plus all accrued and unpaid interest thereon.
Majority Holder Threshold. Certain actions, consents, and waivers under the NPA and the Notes require the approval of the "Majority Holders," defined as holders of Notes representing more than 50% of the aggregate outstanding principal amount of all Notes (i.e., holders of Notes with aggregate outstanding principal in excess of $20,000,000 as of the Closing Date). The Company should note that, as of the Closing Date, Pinnacle BioVentures Fund III, L.P. alone holds $22,000,000 in aggregate principal amount, which exceeds the Majority Holder threshold.
4. Use of Proceeds Reminder
As set forth in Section 5.14 of the NPA, and as described in the Company's representations to the Purchasers during the course of the transaction, the Company intends to apply the $40,000,000 in net proceeds from the issuance of the Notes substantially as follows:
(a) Phase 2b Clinical Trial for GDT-4187 — Approximately $28,000,000 (70%). The Company intends to allocate approximately $28,000,000 to fund the continuation and expansion of its ongoing Phase 2b clinical trial for GDT-4187, the Company's lead product candidate. GDT-4187 is a selective CDK9/FLT3 dual kinase inhibitor being developed for the second-line treatment of refractory non-small cell lung cancer ("NSCLC"). The Phase 2b trial is a multi-center, randomized, double-blind, placebo-controlled study enrolling approximately 280 patients across 22 clinical sites in 8 states. Based on current enrollment projections, topline data from the Phase 2b trial is expected in the first quarter of 2025.
(b) Preclinical Development of GDT-5201 — Approximately $7,000,000 (17.5%). The Company intends to allocate approximately $7,000,000 to the preclinical development of GDT-5201, the Company's next-generation PROTAC (Proteolysis Targeting Chimera) degrader program. These funds are expected to support IND-enabling studies and related preclinical activities through the anticipated IND filing date.
(c) General Corporate Purposes and Working Capital — Approximately $5,000,000 (12.5%). The Company intends to allocate the remaining approximately $5,000,000 for general corporate purposes and working capital needs, including general and administrative expenses, capital expenditures, and other ordinary course operating expenses.
We remind the Company that any material deviation from the intended use of proceeds as described above should be discussed in advance with counsel and, as applicable, with the holders of the Notes, particularly in light of the negative covenant obligations described in Section 5.2 below.
5. Post-Closing Obligations
The Company has a number of important post-closing obligations arising under the NPA, the Notes, and applicable federal and state securities laws. We summarize these obligations below and recommend that the Company promptly implement internal procedures to ensure timely compliance with each.
5.1 Securities Filings
(a) Form D Filing with the SEC. Pursuant to Rule 503 of Regulation D under the Securities Act, the Company is required to file a notice on Form D with the U.S. Securities and Exchange Commission (the "SEC") within fifteen (15) calendar days after the first sale of securities made in reliance on the Rule 506(b) exemption. The first sale of the Notes occurred on April 22, 2024, establishing a filing deadline of May 7, 2024. We recommend that the Form D be filed as promptly as practicable following the Closing, and we have targeted a filing date of April 24, 2024. Calderwood & Harkness LLP will prepare and file the Form D on the Company's behalf using the Company's existing SEC EDGAR credentials. We will circulate a draft of the Form D to you for review prior to filing.
(b) State Blue Sky / Notice Filings. In addition to the federal Form D filing, the Company is required to make notice filings under applicable state "blue sky" laws in connection with the private placement. Based on the jurisdictions of the Purchasers and the Company's places of business, the following state notice filings are required:
(i) California. A notice filing under Section 25102(f) of the California Corporations Code is required to be made with the California Department of Financial Protection and Innovation. This filing must be made within fifteen (15) days of the first sale of securities in California. The applicable filing fee will be calculated based on the aggregate offering amount.
(ii) New York. A notice filing is required with the New York State Department of Law. This filing should be made promptly after closing.
(iii) Massachusetts. A notice filing is required with the Massachusetts Securities Division. This filing should be made promptly after closing.
(iv) Delaware. A notice filing is required with the Delaware Division of Securities. This filing should be made promptly after closing.
Calderwood & Harkness LLP will coordinate the preparation and filing of all applicable state blue sky notice filings on the Company's behalf. We will advise the Company of any filing fees due in connection with these filings.
5.2 Ongoing Covenant Compliance
The NPA imposes a number of ongoing affirmative and negative covenants on the Company for the duration that the Notes remain outstanding. The Company should carefully review Article V of the NPA for the complete terms of these covenants. We highlight the following key obligations for your attention:
(a) Information Rights. The Company has agreed to furnish to each holder of a Note the following financial and operating information on a regular basis:
(i) Quarterly Financial Statements. Unaudited financial statements (balance sheet, income statement, and statement of cash flows) for each fiscal quarter, to be delivered within forty-five (45) days after the end of each fiscal quarter. The first quarterly delivery obligation will arise in connection with the quarter ending June 30, 2024, with a delivery deadline of August 14, 2024.
(ii) Annual Financial Statements. Audited financial statements for each fiscal year, prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and audited by the Company's independent auditors, Baxter & Calloway, CPAs. These statements must be delivered within one hundred twenty (120) days after the end of each fiscal year. The first annual delivery obligation will arise in connection with the fiscal year ending December 31, 2024, with a delivery deadline of April 30, 2025.
(iii) Monthly Cash Burn Reports. Monthly reports setting forth the Company's cash position, cash burn rate, and projected cash runway, to be delivered to each holder on a monthly basis, within fifteen (15) days of the end of each calendar month.
We recommend that the Company establish internal calendar reminders and delivery protocols in coordination with the office of Chief Financial Officer Diane Kowalski to ensure that all information rights deliverables are prepared and distributed within the contractually required timeframes. Failure to timely deliver required financial information could, under certain circumstances, give rise to an Event of Default under Section 7.1 of the NPA.
(b) Negative Covenants — Majority Holder Consent Required. We remind the Company that, pursuant to Section 5.8 of the NPA, the following actions require the prior written consent of the Majority Holders (defined as holders of Notes representing more than 50% of the aggregate outstanding principal amount of all Notes, i.e., holders of Notes with aggregate outstanding principal in excess of $20,000,000 as of the Closing Date). As noted in Section 3 above, Pinnacle BioVentures Fund III, L.P. alone holds $22,000,000 in aggregate principal amount, which exceeds the Majority Holder threshold and thereby has the ability to act unilaterally as the Majority Holder:
(i) The incurrence of additional indebtedness by the Company in an aggregate amount in excess of $2,000,000 (excluding trade payables and other obligations incurred in the ordinary course of business);
(ii) The granting of any lien, security interest, mortgage, pledge, or other encumbrance on any material assets of the Company;
(iii) The declaration or payment of any dividend or other distribution to holders of the Company's equity securities;
(iv) The entry into, or consummation of, any Change of Control transaction (as defined in the NPA); and
(v) The issuance of any equity securities or equity-linked securities of the Company, other than issuances pursuant to the Company's existing 2018 Equity Incentive Plan up to the current plan reserve of 3,500,000 shares.
The Company should implement internal controls to ensure that no action described above is undertaken without first obtaining the prior written consent of the Majority Holders. We recommend that any proposed action potentially falling within the scope of these negative covenants be reviewed with counsel before proceeding.
(c) Most Favored Nation (MFN) Provision. Pursuant to Section 5.12 of the NPA, if the Company issues any convertible debt securities on terms more favorable to the holders thereof than the terms of the Notes at any time during the twelve (12) month period following the Closing Date (i.e., through and including April 22, 2025), each holder of a Note shall have the right, upon written notice to the Company, to elect to amend such holder's Note to incorporate such more favorable terms. This "most favored nation" provision applies broadly to all economic and structural terms of any such convertible debt issuance, including, without limitation, interest rate, discount rate, valuation cap, maturity, conversion mechanics, and change of control provisions.
The Company should consult with Calderwood & Harkness LLP prior to commencing any discussions or negotiations regarding, or entering into any agreements with respect to, any potential convertible debt issuance during the MFN period to ensure compliance with this provision and to evaluate the potential impact on the existing Notes and their holders.
5.3 Closing Binder
Calderwood & Harkness LLP will prepare and deliver a complete closing binder containing all executed transaction documents, certificates, opinions, good-standing certificates, wire transfer confirmations, and ancillary materials relating to the Closing. The closing binder will be delivered in both electronic format (via secure file transfer) and as a bound hard copy. We anticipate delivery of the closing binder within approximately ten (10) business days following the Closing Date.
We recommend that the Company retain the closing binder in its permanent corporate records, along with this post-closing letter, for ease of reference in connection with future financings, audits, and compliance matters. Copies of the closing binder will also be distributed to the Purchasers' counsel, Whitfield, Greer & Cavanaugh LLP, to the attention of Elizabeth Hargrove, Partner, at the address set forth in Section 6 below.
6. Investors' Counsel
For the Company's records, we note that Whitfield, Greer & Cavanaugh LLP ("WGC") represented the Purchasers as a group in connection with this transaction. The principal contacts at WGC were Elizabeth Hargrove, Partner, and James Petrosian, Senior Associate. WGC's offices are located at 1251 Avenue of the Americas, 34th Floor, New York, NY 10020. Copies of all closing deliverables, including the executed transaction documents and the closing binder, will be circulated to WGC at the address noted above.
7. Our Continuing Availability
Calderwood & Harkness LLP remains available to assist the Company with any questions regarding the transaction documents, interpretation of the NPA or the Notes, post-closing compliance obligations, securities filings, or any future financing matters that may arise. We encourage the Company to contact us in advance of any action that may implicate the covenants or other provisions of the NPA and the Notes, including, without limitation, any potential additional debt issuance, equity financing, or strategic transaction.
The primary contacts at our firm for matters relating to this transaction are:
Theodore Langston, Partner (responsible partner) Telephone: (415) 772-8125
Email: tlangston@calderwoodharkness.com
Audrey Zhou, Associate (lead associate) Telephone: (415) 772-8247
Email: azhou@calderwoodharkness.com
Both Ted and Audrey are available at your convenience to address any questions or requests that may arise.
8. Acknowledgment and Gratitude
On behalf of the entire Calderwood & Harkness team, we would like to extend our sincere thanks to you, to Dr. Marcus Avellino, and to Diane Kowalski for your collaboration and responsiveness throughout the course of this transaction. We recognize that the ten-day delay in the Closing required additional coordination and diligence on the part of the Company's team, and we appreciate the efficient manner in which the updated officers' certificate and disclosure schedule revisions were finalized.
We congratulate the Company on the successful completion of this $40,000,000 convertible note placement. The funding secured through this transaction will be instrumental in advancing the Company's Phase 2b clinical trial for GDT-4187 and its broader pipeline. We look forward to supporting Genome Dx Therapeutics as it continues to pursue its mission of developing transformative therapies for patients with serious unmet medical needs.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Theodore Langston, Partner Capital Markets Group 600 California Street, 40th Floor San Francisco, CA 94108
cc: Dr. Marcus Avellino, Ph.D., MBA, Chief Executive Officer, Genome Dx Therapeutics Inc. cc: Diane Kowalski, CPA, Chief Financial Officer, Genome Dx Therapeutics Inc. cc: Vivienne St. Claire, Partner, Calderwood & Harkness LLP cc: Audrey Zhou, Associate, Calderwood & Harkness LLP cc: Brendan Walsh, Associate, Calderwood & Harkness LLP
Purchaser | Principal Amount | Percentage of Placement
Pinnacle BioVentures Fund III, L.P. | $22,000,000 | 55.0%
Cormorant Health Capital Partners, L.P. | $12,000,000 | 30.0%
Alder Creek Life Sciences Fund II, L.P. | $6,000,000 | 15.0%
Total | $40,000,000 | 100.0%

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