UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): March 125, 2024

Ayala Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

Delaware		001-36138		84-1521955
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

9 DEER PARK DRIVE, SUITE K-1 MONMOUTH JUNCTION, New Jersey		08852
(Address of principal executive offices)		(Zip code)

Registrant's telephone number, including area code (732) 545-1590

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter):

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 12.01. ~~Entry~~ ~~into~~Completion aof ~~Material~~Acquisition ~~Definitive~~or ~~Agreement~~Disposition of Assets.

~~The~~Sale ~~information~~of ~~set~~Assets ~~forth~~to ~~below~~Immunome, ~~in Item 2~~Inc.~~03 is hereby incorporated into this Item 1.01 by reference.~~

~~Item~~On ~~2.03 Creation~~February of5, 2024, Ayala Pharmaceuticals, Inc., a ~~Direct~~Delaware ~~Financial~~corporation ~~Obligation~~(the or“Company”), anand ~~Obligation~~Immunome, ~~under~~Inc. (“Purchaser”), entered into an ~~Off-Balance~~Asset ~~Sheet~~Purchase ~~Arrangement~~Agreement (the “Asset Purchase Agreement”) pursuant to which Purchaser agreed to acquire, and the Company agreed to sell, certain of athe ~~Registrant~~Company’s assets and liabilities related to its AL101 and AL102 programs (the “Asset Sale”), which constitute substantially all of the Company’s assets.

AsOn ~~previously~~March ~~disclosed~~25, ~~on November 17~~2024, ~~2023,~~ the Company ~~issued~~and ~~Senior~~Purchaser ~~Convertible~~consummated ~~Promissory~~the ~~Notes~~Asset ~~(collectively,~~Sale pursuant to the ~~“November~~Asset ~~2023~~Purchase ~~Senior Convertible~~Agreement, ~~Notes”~~such that Purchaser (i), inpaid an ~~aggregate~~upfront ~~amount~~purchase price of $420.0 million, toin ~~several~~cash ~~existing~~to ~~lenders and investors in~~ the Company, ~~including~~less ~~Israel~~certain ~~Biotech Fund I~~adjustments, ~~L.P.,~~(ii) ~~Israel~~issued ~~Biotech~~the ~~Fund~~Company II2, ~~L.P.~~175,489 ~~Arkin Bio Ventures L.P. and Biotel Limited (the “Noteholders”). The Senior Convertible Notes are convertible into~~ shares of ~~the Company~~Immunome’s common stock, ~~par value $0.001 per share~~ (the “~~Common Stock~~Shares”) ~~at any time at the option of the Noteholders~~, ~~and~~(iii) ~~are~~assumed ~~subject~~specified toliabilities ~~mandatory~~from ~~conversion upon certain events, including a change of control transaction and certain financing transactions involving~~ the Company, atand ~~a conversion price equal to the lower of~~ (iiv) ~~50%~~reimbursed of the ~~Common Stock’s price per share as of market close on November 16, 2023~~Company ~~and~~ for ~~(ii)~~certain ~~50%~~costs ofincurred ~~the~~by ~~Common Stock’s price per share as of~~ the ~~close~~Company ofassociated ~~market~~with on the ~~Trading~~assets ~~Day~~being ~~immediately prior to the date of the Notice of Conversion, subject to certain adjustments~~purchased. InPurchaser ~~connection~~may ~~with~~pay the ~~issuance of the November 2023 Senior Convertible Notes, the~~ Company ~~issued~~up to ~~the~~$37.5 ~~Noteholders~~million ~~warrants~~after ~~to purchase an aggregate of 15,000,000 shares of~~ the ~~Common~~Asset ~~Stock~~Purchase ~~with~~Closing anupon ~~exercise price equal to~~ the ~~lower~~achievement of ~~(A)~~certain ~~50% of the Common Stock’s price per share as of market close on~~development ~~November 16, 2023~~ and ~~(ii)~~commercial 50% of the Common Stock’s price per share as of the close of market on the Trading Day immediately prior to the date of the Notice of Exercise of the warrant, subject to adjustment, which exercise may be on a cashless basismilestones.

~~Pursuant~~The toAsset ~~the~~Purchase ~~Side Letter~~ Agreement ~~(New~~contains ~~Notes)~~customary ~~between~~representations, ~~the~~warranties, ~~Noteholders~~conditions and ~~the~~covenants, ~~Company~~including ~~also~~covenants ~~entered~~(i) ~~into~~concerning onthe ~~November~~conduct ~~17,~~of ~~2024,~~business ~~the Noteholders~~by ~~have~~ the ~~right~~Company prior to ~~lend~~the anClosing, ~~additional~~(ii) ~~$4.0~~prohibiting ~~million dollars to~~ the Company onand ~~the~~its ~~same~~representatives ~~terms~~from soliciting, ~~including~~initiating ~~warrant~~or ~~coverage.~~knowingly ~~This~~inducing, ~~right~~encouraging isor ~~exercisable~~facilitating ~~until~~any ~~the~~competing ~~earliest~~acquisition ofproposal, (iiii) ~~May~~prohibiting ~~17,~~the ~~2024,~~Company ~~(ii)~~and ~~the~~its controlled ~~date~~affiliates offrom ~~consummation~~competing ofwith aPurchaser ~~Change~~for offive ~~Control Transaction~~years following the Closing in certain fields, and (~~iii~~iv) restricting the ~~date~~Company’s ofability ~~consummation~~to ofmake adistributions ~~Financing~~to ~~Transaction~~stockholders, ~~(both~~dissolve asor ~~defined~~wind inup ~~the~~its ~~such~~business ~~Side~~or ~~Letter~~file ~~Agreement)~~for bankruptcy for six months following the Closing.

OnThe ~~March~~foregoing 1,description ~~2024,~~of the ~~Company~~Asset ~~issued~~Purchase ~~Senior~~Agreement ~~Convertible~~and ~~Promissory Notes to~~ the ~~Noteholders~~transactions ~~(collectively,~~contemplated by the ~~“March~~Asset ~~2024~~Purchase ~~Senior~~Agreement ~~Convertible Notes”),~~does innot ~~substantially~~purport ~~the~~to ~~same~~be ~~form~~complete asand ~~the~~is subject ~~November~~to, ~~2023~~and ~~Senior~~qualified ~~Convertible Notes,~~ in ~~connection~~its ~~with~~entirety ~~the loan~~ by ~~the~~reference ~~Noteholders~~ to, the ~~Company~~full antext ~~additional~~of ~~$2.0 million, pursuant to their rights under~~ the ~~Side~~Asset ~~Letter~~Purchase Agreement, ~~(New Notes). In~~which ~~connection~~was ~~with~~previously ~~the~~filed ~~issuance~~as ofExhibit ~~the~~2.1 ~~March~~to ~~2024 Senior Convertible Notes,~~ the ~~Company~~Registrant’s ~~issued~~Current toReport ~~the~~on ~~Noteholders~~Form ~~warrants~~8-K tofiled ~~purchase~~on anFebruary ~~aggregate of 7~~6,~~500,000~~ ~~shares~~2024 ofwith the ~~Common~~Securities ~~Stock~~and Exchange onCommission ~~the~~and ~~same~~is ~~terms~~incorporated asby ~~the~~reference ~~warrants issued on November 17, 2023~~herein.

~~The~~Item ~~shares~~3.02. ofUnregistered ~~Common~~Sales ~~Stock issuable upon conversion~~ of ~~the~~Equity March 2024 Senior Convertible Notes and such warrants are covered by the Registration Rights Agreement dated as of November 17, 2023 entered into by the Company and the Noteholders providing to the Noteholders customary rights with respect to the registration of the shares of Common Stock issuable upon conversion of the notes or exercise of the warrants under the Securities ~~Act of 1933, as amended~~.

~~The~~As previously disclosed, on March 1, 2024, the Company issued Senior Convertible Promissory Notes (collectively, the ~~warrants~~“March ~~issued~~1 Convertible Notes”), in ~~connection~~an ~~therewith~~aggregate amount of $2.0 million, to several existing lenders and investors in the Company, including Israel Biotech Fund I, L.P., Israel Biotech Fund II, L.P., Arkin Bio Ventures L.P. and Biotel Limited. The March 1 Convertible Notes were convertible into shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), ~~issuable~~at ~~pursuant~~any totime at the ~~conversion~~ option of ~~such~~the ~~notes~~noteholders, and ~~the~~subject ~~exercise~~to mandatory conversion upon certain events, including a Change of ~~such~~Control ~~warrants~~Transaction, ~~were~~as defined ~~offered~~in ~~and~~the ~~sold~~March ~~pursuant~~1 Convertible Notes, at a conversion price equal to the ~~exemption~~lower ~~from~~of (i) 50% of the ~~registration~~Common ~~requirements~~Stock’s price per share as of market close on November 16, 2023 and (ii) 50% of the ~~Securities~~Common ~~Act~~Stock’s price per share as of ~~1933~~the close of market on the Trading Day immediately prior to the date of the Notice of Conversion, assubject ~~amended~~to certain adjustments. In connection with the issuance of the March 1 Convertible Notes, ~~afforded~~the byCompany ~~Section~~also 4issued to the noteholders warrants (athe “Warrants”) to purchase an aggregate of 7,500,000 shares of the Common Stock with an exercise price equal to the lower of (2A) ~~thereof,~~50% ~~for~~of the ~~sale~~Common Stock’s price per share as of market close on November 16, 2023 and (ii) 50% of the Common Stock’s ~~securities~~ price ~~not~~per ~~involving~~share as of the close of market on the Trading Day immediately prior to the date of the Notice of Exercise of the warrant, subject to adjustment, which exercise may be on a ~~public~~cashless ~~offering~~basis.

~~The~~In ~~foregoing~~connection ~~summaries~~with the closing of the Asset Sale, on March 25, 2024, ~~Senior~~March 1 Convertible Notes ~~and~~were ~~the~~automatically ~~warrants~~converted ~~issued~~ in ~~connection~~full ~~with~~utilizing a conversion price equal to 50% of the Common Stock’s price per share as of market close on March 22, 2024. As ~~Senior~~a ~~Convertible Notes~~result, doan ~~not~~aggregate ~~purport~~of to6,666,666 beshares ~~complete~~of ~~and~~Common ~~are~~Stock ~~qualified~~were inissued ~~their~~by ~~entireties~~the byCompany ~~reference~~to the noteholders and pursuant to the ~~full~~exemption ~~copies~~from ofthe registration ~~such~~requirements ~~agreements~~of ~~and~~the ~~instruments,~~Securities ~~which~~Act ~~are~~of ~~attached~~1933, as ~~exhibits~~amended, ~~10.1~~afforded ~~and~~by ~~10.~~Section 4(a)(2,) ~~respectively~~thereof, tofor ~~this~~the ~~Form~~sale ~~8-K~~of ~~and~~securities ~~incorporated~~not ~~into~~involving ~~this Item~~a ~~2.03~~public ~~by reference.~~offering

Item 97.01. ~~Financial~~ ~~Statements~~Regulation ~~and~~FD ~~Exhibits~~Disclosure.

~~(d)~~On ~~Exhibits~~March 25, 2024, the Company and Purchaser issued a joint press release announcing the execution of the Asset Purchase Agreement. A copy of that press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

Exhibit No.		Description
10.1(1)		Senior Convertible Promissory Note, dated March 1, 2024, by and between Ayala Pharmaceuticals, Inc. and Israel Biotech Fund I, L.P.
10.2(2)		Common Stock Purchase Warrant (Convertible Note), dated March 1, 2024, issued by Ayala Pharmaceuticals, Inc. to Israel Biotech Fund I, L.P.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

In accordance with General Instruction B.2 of Form 8-K, the foregoing information, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall such information, including Exhibit 99.1, be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

~~(1) Pursuant to Instruction 2 to Item 601 of Regulation S~~Forward-K,Looking the Company has filed a copy of one Senior Convertible Promissory Note, and has set forth as follows the other documents omitted. The Company acknowledges that the Commission may at any time in its discretion require filing of copies of any documents so omitted.Statement

1The statement contained in this Form 8-K that Purchaser may pay the Company up to $37.5 ~~Senior~~million ~~Convertible~~after ~~Promissory~~the ~~Note,~~Asset ~~dated~~Purchase ~~March~~Closing 1,upon ~~2024,~~the byachievement of certain development and ~~between~~commercial ~~Ayala~~milestones ~~Pharmaceuticals~~may be considered a forward-looking statement, ~~Inc.~~as ~~and~~such ~~Israel~~involving ~~Biotech~~a ~~Fund~~number IIof risks and uncertainties, Lincluding.P. 2Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. ~~Senior~~Actual ~~Convertible~~results ~~Promissory~~could ~~Note~~differ materially from those contained in any forward-looking statement as a result of various factors, ~~dated~~including, ~~March~~without 1limitation, ~~2024~~risks and uncertainties related to: the potential benefit of the Asset Sale and whether the milestones relating to such potential payments will be realized, bywhich will depend on factors such as Purchaser’s ability to grow and ~~between~~successfully ~~Ayala~~execute ~~Pharmaceuticals~~on its business plan, ~~Inc.~~including the development and ~~Arkin~~commercialization ~~Bio~~of ~~Ventures~~the ~~L.P.~~AL101 3and AL102 programs. Except ~~Senior~~as ~~Convertible~~required ~~Promissory~~by ~~Note~~applicable law, ~~dated~~the ~~March~~Company 1undertakes no obligation to revise or update any forward-looking statement, ~~2024~~or to make any other forward-looking statements, bywhether ~~and~~as ~~between~~a ~~Ayala~~result ~~Pharmaceuticals~~of new information, ~~Inc.~~future ~~and~~events ~~Biotel~~or ~~Limited~~otherwise.

~~(2) Pursuant to Instruction 2 to~~ Item ~~601~~9.01 of– ~~Regulation~~Financial ~~S-K,~~Statements ~~the Company has filed a copy of one Common Stock Purchase Warrant (Convertible Note),~~ and ~~has set forth as follows the other documents omitted~~Exhibits. ~~The Company acknowledges that the Commission may at any time in its discretion require filing of copies of any documents so omitted.~~

~~1. Common Stock Purchase Warrant~~ (~~Convertible Note~~b), Pro ~~dated~~forma ~~March~~financial ~~1, 2024, issued by Ayala Pharmaceuticals, Inc~~information. to Israel Biotech Fund II, L.P. 2. Common Stock Purchase Warrant (Convertible Note), dated March 1, 2024, issued by Ayala Pharmaceuticals, Inc. to Arkin Bio Ventures L.P. 3. Common Stock Purchase Warrant (Convertible Note), dated March 1, 2024, issued by Ayala Pharmaceuticals, Inc. to Biotel Limited.

The Company intends to amend this Current Report on Form 8-K to include the pro forma financial information related to the Asset Sale promptly after it files its Annual Report on Form 10-K for the year ended December 31, 2023.

(d) Exhibits

Exhibit Number	Description
2.1+†	Asset Purchase Agreement, dated as of February 5, 2024, by and between Ayala Pharmaceuticals, Inc. and Immunome, Inc. (incorporated by Reference to Exhibit 2.1 to the Current Report on Form 8-K of the Registrant, filed with the SEC on February 6, 2024).
99.1	Press release dated March 25, 2024.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

+ Certain schedules and exhibits to this agreement have been omitted in accordance with Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the Securities and Exchange Commission on request.

† Certain confidential information contained in this document, marked by ***, has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because it is both (i) not material and (ii) the type of information that the registrant treats as private or confidential.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

March 5, 2024	AYALA PHARMACEUTICALS, INC.
March 29, 2024	AYALA PHARMACEUTICALS, INC.
	By:	/s/ Kenneth A. Berlin
		Name: Kenneth A. Berlin
		Title: President and Chief Executive Officer

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