Ascendis Pharma(US:ASND)2023-06-29 16:00Articles of Association Company Identity and Objects This section defines Ascendis Pharma A/S's identity, specifying its name and core business in medical preparations and related company investments - The company's name is Ascendis Pharma A/S2 - The company's object is to develop, manufacture, and sell medical preparations and ideas for combating diseases, and to own shares in related companies3 Company Capital and Shares This section details the company's capital structure, including total share capital, Board authorizations for capital increases, and warrant issuance history Share Capital Structure | Description | Value | | :--- | :--- | | Total Share Capital | DKK 57,335,496 | | Par Value per Share | DKK 1 | - A total of 12,375,332 warrants have been issued under articles 4a, 4g, 4h, and 4i, with 5,508,224 exercised, annulled, or lapsed as of June 26, 20238 Board Authorizations for Capital Increases & Instruments | Article | Authorization Type | Max Nominal Value (DKK) | Expiration Date | Pre-emptive Rights | | :--- | :--- | :--- | :--- | :--- | | 4d(1) | Share Increase (Cash) | 9,000,000 | May 28, 2024 | With rights | | 4d(2) | Share Increase (Cash/In-kind) | 6,125,000 (reduced) | May 27, 2026 | Without rights | | 4e | Convertible Bonds | 9,000,000 | May 29, 2027 | Without rights | | 4f | Warrants (Mgmt/Employees) | 1,000,000 | May 29, 2027 | Without rights | | 4h | Warrants (Board/Mgmt/Employees) | 2,000,000 | May 28, 2025 | Without rights | | 4i | Warrants (Mgmt/Employees) | 2,000,000 | May 27, 2026 | Without rights | - Shares are issued in the holder's name, registered in the company's shareholder register, are non-negotiable instruments, and no share certificates are issued104 General Meetings This section governs shareholder general meetings, detailing location, language, notice periods, annual meeting timing, agenda, and voting rights based on DKK 1 per share - General meetings are held in the Greater Copenhagen area and conducted in English106 - The annual general meeting must be held within 5 months after the end of the accounting year107 - Each share of DKK 1 carries one vote, and matters are generally adopted by a simple majority111 - The ordinary general meeting agenda includes the board's report, annual report adoption, profit/loss resolution, election of board members and auditors, and other motions110 Board of Directors and Management This section details the company's governance, outlining the Board of Directors' composition, term limits, retirement age, management team appointment, and binding authority - The Board of Directors consists of 3 to 10 members elected for two-year staggered terms113114 - Board members must retire at the ordinary general meeting following their 75th birthday115 - The Board employs a management team of 1 to 5 members for day-to-day management116 - The company is legally bound by the joint signatures of the chairman and one management member, or by three board members117 Audit, Accounting, and Communication This section outlines the company's audit requirements, accounting year, language for financial reports, and authorization for electronic shareholder communication - A state-authorized public accountant, elected annually by the general meeting, audits the company's annual reports118 - The company's accounting year is the calendar year, with annual and interim reports presented in English119 - The company utilizes electronic communication for all shareholder correspondence, including meeting notices, annual reports, and stock exchange announcements120 Appendices Appendix 1 & 1a: Terms and Conditions for Warrants These appendices detail the company's warrant incentive scheme, outlining vesting schedules (monthly and cliff), exercise periods, termination conditions, and anti-dilution adjustments for capital changes - Warrants are granted free of charge to employees, consultants, and board members as an incentive to focus on company value increase123150 Vesting Schedules for Warrants | Appendix | Recipient | Vesting Schedule | | :--- | :--- | :--- | | Appendix 1 | Employees & Consultants | 1/48th of warrants vest monthly from the grant date | | Appendix 1 | Board Members | 1/48th monthly for initial grant; 1/24th monthly for subsequent grants | | Appendix 1a | Employees & Consultants | 25% cliff vest after one year; remaining 75% vests 1/36th per month thereafter | | Appendix 1a | Board Members (Initial) | 25% cliff vest after one year; remaining 75% vests 1/36th per month thereafter | | Appendix 1a | Board Members (Subsequent) | 50% cliff vest after one year; remaining 50% vests 1/12th per month thereafter | - Warrants may be exercised during four periods annually, starting two trading days after quarterly earnings report publication128153 - The terms include detailed anti-dilution adjustments for warrant number and exercise price in response to capital structure changes like bonus share issues, non-market capital changes, mergers, or significant dividends130156 - Warrants generally lapse automatically on the tenth anniversary of the grant date if not exercised142167 Appendix 2: Additional Terms and Conditions for Warrants This appendix outlines terms for an earlier set of warrants, including monthly vesting, accelerated vesting upon an 'Exit-event,' specific exercise periods, and adjustments for capital changes or termination - Warrants under this appendix generally vest at a rate of 1/48 per month from the date of grant176 - An accelerated vesting clause applies in an 'Exit-event' (merger, split, or sale of over 50% capital), with 50% of unvested warrants vesting if before January 1, 2014, and 100% if on or after176 - The last exercise period for these warrants was 21 days following the publication of the interim report for the first half of 2023, or the nine-month report in 2023 for specific grants177 Appendix 3: Summary of Granted Warrants This appendix provides a detailed ledger of all warrants granted under various articles, summarizing total issued, exercised, annulled, and lapsed warrants as of June 26, 2023 Warrant Status Summary (as of June 26, 2023) | Category | Warrants under Arts. 4a, 4g, 4h, 4i | Warrants under Art. 4c | | :--- | :--- | :--- | | Total Granted | 12,375,332 | 566,504 | | Exercised | 4,361,391 | 525,364 | | Annulled | 19,580 | 0 | | Lapsed | 1,127,253 | 32,354 | | Outstanding | 6,867,108 | 8,786 | - The authorizations to issue new warrants under articles 4a and 4g are fully exhausted204205 - Warrants granted up to November 2021 generally vested 1/48th per month, while those from December 2021 onwards follow a cliff vesting schedule (25% after one year, then monthly vesting over 3 years)206210211 Appendix 4: Indenture for 2.25% Convertible Senior Notes due 2028 This appendix presents the indenture for the company's 2.25% Convertible Senior Notes due 2028, detailing terms, interest, conversion rights, redemption options, covenants, and default procedures Key Terms of 2.25% Convertible Senior Notes due 2028 | Term | Description | | :--- | :--- | | Issuer | Ascendis Pharma A/S | | Trustee | U.S. Bank Trust Company, National Association | | Issue Date | March 29, 2022 | | Maturity Date | April 1, 2028 | | Interest Rate | 2.25% per annum | | Interest Payment Dates | April 1 and October 1 | | Initial Conversion Rate | 6.0118 ADSs per $1,000 principal amount | Covenants This section outlines the company's covenants under the indenture, including payment obligations, SEC reporting, and provisions for Additional Interest and Additional Amounts to cover withholding taxes - The company must send copies of all required SEC filings to the Trustee within 15 days of their filing date303 - Additional Interest of 0.50% per annum will accrue if the notes are not 'Freely Tradable' during the six-month period beginning six months after the issue date or after the De-Legending Deadline Date306 - The company is obligated to pay 'Additional Amounts' to ensure beneficial owners receive the net amount due, even if withholding taxes are required by a Relevant Taxing Jurisdiction308 Redemption This section details note redemption conditions, including holder rights upon a 'Fundamental Change,' the company's optional 'Provisional Redemption' based on ADS price, and 'Tax Redemption' due to tax law changes - Upon a Fundamental Change, holders can require the company to redeem notes for cash at 100% of principal plus accrued interest320 - The company may redeem notes on or after April 7, 2025, if the Last Reported Sale Price per ADS exceeds 130% of the Conversion Price for at least 20 of 30 consecutive trading days329 - The company may redeem all notes if a Change in Tax Law necessitates paying Additional Amounts, though holders retain an opt-out election330 Conversion This section details note conversion rights into ADSs, including the initial conversion rate, anti-dilution adjustments for corporate actions, and increased conversion rates for 'Make-Whole Fundamental Changes' - Holders may convert notes at any time until the close of business on the second scheduled trading day before maturity340 - The Conversion Rate is subject to adjustment for corporate actions including share dividends/splits, rights offerings, spin-offs, significant cash dividends, and tender/exchange offers353354356358359 - If a 'Make-Whole Fundamental Change' occurs, the conversion rate will increase for notes converted during a specified period, based on the effective date and ADS price of the transaction368 - In an 'Ordinary Share Change Event' like a merger, the right to convert into ADSs will be replaced by a right to convert into a unit of the new Reference Property376 Defaults and Remedies This section defines 'Events of Default' for the notes, including payment failures, covenant breaches, and bankruptcy, outlining remedies such as acceleration of principal and special interest for reporting defaults - Events of Default include non-payment of principal or interest, failure to convert notes, covenant breaches, cross-default on other indebtedness exceeding $100 million, and bankruptcy proceedings389390 - Upon an Event of Default (excluding bankruptcy), the Trustee or holders of at least 25% of the notes can declare all outstanding notes immediately due and payable, with automatic acceleration upon company bankruptcy391392 - For a 'Reporting Event of Default,' the company can elect to pay 'Special Interest' as the sole remedy for the first 180 days, after which acceleration becomes a possible remedy393