Karyopharm Therapeutics - Chapter 11 Plan Terms

Plan / RSA Terms

Overview

• Karyopharm Therapeutics Inc. and KPT Texas LLC filed a joint prepackaged Chapter 11 plan dated Nov. 2, 2026. The plan implements a restructuring support agreement signed the same day. Under it, the DIP lenders, 1L term lenders and secured noteholders take 100% of reorganized Karyopharm's equity. That equity is then exchanged at once, in a merger with Ayrmid Ltd., for 55.0% of the combined company (NewCo) plus contingent value rights.
• The merger is the default path. The debtors are also marketing the business and may switch to a sale if a bid meets mandatory conditions, the first being net proceeds of at least $335.4 million. A sale requires the consent of the Required Consenting Funded Debt Parties (as defined in the RSA). In a sale, the DIP claims, 1L term loan claims and 1.5L 2028 notes claims are paid in full in cash; Ayrmid is entitled to bid protections, subject to the bidding procedures order, and may be designated back-up bidder.
• The reorganization path also includes:
  • an up to $135 million exit term loan to NewCo that refinances up to $50 million of DIP new money claims
  • the exchange of $113.54 million in allowed revenue interest financing agreement (RIFA) claims for a five-year, 3.0% unsecured royalty on selinexor products
  • unimpaired treatment of general unsecured claims
  • cancellation of all existing preferred and common stock, including Karyopharm's Nasdaq-listed shares
• The RSA follows a Sept. 10, 2026 forbearance agreement and limited waiver under the indentures. The parties were the company, certain of the consenting stakeholders and the prepetition agents. A fee letter of the same date was signed between Karyopharm and the forbearing stakeholders.
• Plan distributions are funded from cash on hand and cash from operations. In the reorganization, reorganized Karyopharm stock, the DIP facility and the NewCo facility are added; in a sale, the sale proceeds are added.

Reorganization Transaction and Ayrmid Merger

• Reorganized Karyopharm common stock is allocated as follows, subject to the restructuring transactions memorandum. Each range depends on how much of the DIP new money claims is equitized.
  • DIP new money claims (equitized portion): 0% to 2.521%
  • DIP roll-up claims: 21.685% to 22.246%
  • 1L term loan claims: 36.096% to 37.029%
  • 1.5L 2028 notes claims: 6.439% to 6.606%
  • 2L 2029 notes claims: 33.259% to 34.119%
• Immediately after issuance, the shares are exchanged in the merger for merger consideration, which consists of:
  • 55.0% of NewCo's common stock outstanding on the effective date after the merger, subject to dilution only by the Omisirge Contingent Equity and the management incentive plan
  • MF CVRs issued by NewCo
• Holders are deemed to have received and exchanged the reorganized shares, and NewCo stock and MF CVRs are delivered to them directly.
• NewCo will own, directly or indirectly, 100% of reorganized Karyopharm and Ayrmid. It may be a newly formed or existing entity, as the Required Consenting Funded Debt Parties and Ayrmid agree. If NewCo is not Ayrmid itself, both reorganized Karyopharm and Ayrmid survive as its wholly owned subsidiaries.
• NewCo stock and MF CVRs issued on DIP new money and roll-up claims come only out of the consideration that would otherwise go to the prepetition funded debt holders. They do not dilute Ayrmid's equityholders or the Omisirge Contingent Equity.
• Omisirge Contingent Equity: additional NewCo common stock issuable to Ayrmid's pre-merger equityholders if and to the extent the merger agreement specifies. It dilutes only NewCo stock issued on account of claims under the plan, not the stock Ayrmid's equityholders receive in the merger.
• MF CVRs: contingent value rights issued by NewCo under an MF CVR agreement to be filed with the plan supplement. They are not equity and carry no voting or governance rights.
• Ayrmid term loan: this is Ayrmid's own debt under a Dec. 12, 2022 loan and security agreement, amended March 13, 2025. It must be equitized into pre-effective date Ayrmid or structurally subordinated in full to claims against and equity in NewCo, in a manner acceptable to the Required Consenting Funded Debt Parties in their sole discretion. No NewCo facility proceeds may be used to prepay it.
• Because the merger is carried out under the plan, it does not trigger change-of-control, default or similar provisions in assumed or reinstated contracts.
• The transaction will be structured, as far as reasonably practicable, to minimize cash taxes and maximize tax attributes. The structure must be reasonably acceptable to the debtors, the Required Consenting Funded Debt Parties and Ayrmid.

DIP Claims

• In the reorganization, DIP new money claims are repaid in cash from up to $50 million of NewCo facility proceeds plus excess cash, and any remainder is equitized. DIP roll-up claims convert to equity. In a sale, all DIP claims are paid in full in cash.
• The DIP facility is senior secured and consists of new money term loans plus loans deemed made on a roll-up of 1L term loan claims. New money claims include interest paid in kind and any exit fee.
• The DIP term sheet is Exhibit D to the RSA; once a DIP order is entered, the version attached to it controls. A DIP credit agreement is to be signed in connection with the final DIP order.
• In the reorganization, each holder of DIP new money claims receives its pro rata share of cash equal to the sum of:
  • up to $50 million of NewCo facility loan proceeds
  • the debtors' unrestricted balance-sheet cash, excluding NewCo facility proceeds, left after funding the reserved purposes
• The reserved purposes consist of:
  • the Carve-Out
  • the German RemainCo winddown account
  • the debtors' reasonable estimate of allowed administrative claims, including professional fees and restructuring expenses
  • DIP budget amounts allocated to allowed general unsecured claims not yet paid
• New money claims not repaid in cash receive the DIP new money equity distribution (0% to 2.521%). Roll-up claims receive the DIP roll-up equity distribution (21.685% to 22.246%).
• In a sale, DIP claims are paid in full in cash from sale proceeds on the effective date. The DIP lenders keep their right to full cash payment under any transaction or plan other than the reorganization transaction.

NewCo Exit Facility

• Size: up to $135 million of new money senior secured exit term loans. The facility is available only in the reorganization and can be drawn in full on the effective date, immediately after the merger closes.
• Borrower and lenders: NewCo (or another borrower named in the facility documents) and certain other reorganized debtors borrow. Lenders may include consenting funded debt parties, DIP lenders and their affiliates or managed funds.
• Use of proceeds, in each case subject to the DIP budget:
  • refinancing up to $50 million of DIP new money claims in cash, or repaying them in full if they total $50 million or less
  • paying cure costs and other plan obligations
  • funding working capital for NewCo and the reorganized debtors
• Security: liens are perfected automatically on entry of the confirmation order, without further filings, and cannot be avoided, recharacterized or subordinated. Substantially final facility documents will be filed with the plan supplement.

New Royalty Agreement

• In the reorganization, RIFA holders receive an unsecured royalty of 3.0% of NewCo's net revenues from all products containing selinexor for five years after the effective date. This includes XPOVIO (selinexor) in combination with ruxolitinib for patients with myelofibrosis.
• The royalty agreement is signed by NewCo and each subsidiary that owns or controls selinexor assets, with the RIFA holders (or their designee) and the royalty collateral agent. Its terms are described more fully in the Ayrmid transaction term sheet, and a substantially final form will be filed with the plan supplement.
• The obligations are unsecured, with no lien on NewCo or reorganized debtor assets. The agreement includes an $18.75 million liquidated damages provision.
• The agreement replaces the Sept. 14, 2019 RIFA in its entirety. The RIFA is canceled, including any change-of-control payment or premium under it.
• RIFA holders may pursue buying the debtors' interests in certain other royalty agreements for up to $35 million in aggregate consideration. Neither the debtors nor NewCo is obliged to sell. Any sale needs the consent of the debtors, the Required Consenting Funded Debt Parties and, unless the debtors have selected an acceptable alternative transaction, Ayrmid.

Sale Option and Marketing Process

• The debtors intend to complete the reorganization, but a sale can replace it if a successful bid meets three mandatory conditions:
  • net proceeds at closing of at least $335.4 million, of which the $18.75 million allocable to RIFA claims may be paid in cash or in non-cash consideration acceptable to the RIFA holders in their discretion
  • payment in full in cash of any bid protections
  • cash funding of the wind-down budget at closing
• Every qualified bid must meet those conditions. The debtors may not pick a bid from anyone other than Ayrmid as the successful bid unless it does, and Ayrmid's own bid may be selected.
• To choose a sale, the debtors need the consent of the Required Consenting Funded Debt Parties and, where the RSA requires, the Required Consenting Royalty Investors. They must file a sale election notice by the plan supplement deadline and before the earlier of the confirmation hearing and the sale hearing.
• Marketing, bid qualification, any auction and bid selection follow the RSA and the bidding procedures. A bidding procedures order is to approve those procedures, a form APA and the bid protections, and set the bid deadline and auction date.
• An auction is held only if one or more qualified bids arrive by the bid deadline. The Required Consenting Funded Debt Parties may credit bid.
• A sale may be an equity sale under the plan or an asset sale under section 363 or the plan. The sale hearing may be combined with confirmation.
• In a sale:
  • DIP claims, 1L term loan claims and 1.5L 2028 notes claims are paid in full in cash; for the funded debt this includes pre- and postpetition default-rate interest and redemption premiums
  • 2L 2029 notes claims are paid in full in cash or, if the successful bid so provides, in line with the mandatory conditions
  • RIFA claims receive consideration worth at least $18.75 million
• In an asset sale, the post-effective date debtors wind down under a plan administrator and a wind-down budget. The debtors select the administrator with the consent of the Required Consenting Funded Debt Parties, and the administrator is named in the plan supplement. The wind-down budget must be satisfactory to the debtors and the Required Consenting Funded Debt Parties.

Ayrmid Bid Protections and Back-Up Bid

• Ayrmid's bid protections are set by the RSA and the bidding procedures order and may include a break-up fee, termination fee or expense reimbursement. They are earned when a successful bid from anyone other than Ayrmid is selected.
• Once earned, the bid protections are allowed administrative claims. They rank ahead of other administrative claims under sections 503(b)(1) and 507(a) and behind the DIP claims and the Carve-Out. They keep that status even if the alternative transaction never closes.
• They are payable in cash within three business days after an acceptable alternative transaction or alternative restructuring proposal (as defined in the RSA) closes, either of which may be the sale, and are paid from that transaction's cash proceeds.
• Payment depends on Ayrmid complying with the RSA and is subject to the exceptions in section 14.07(b) of the RSA. Those exceptions include termination of the RSA as to Ayrmid because of Ayrmid's breach, its withdrawal from the sale process, or its failure to complete the reorganization unless another RSA party directly or proximately caused that failure.
• Ayrmid's advisors' fees count as restructuring expenses only if the bid protections are earned, and are not paid twice where an expense reimbursement is already paid as a bid protection.
• The debtors may name Ayrmid back-up bidder by written notice on or before the end of the auction. Its commitment to complete the reorganization on RSA terms, as improved at the auction, then stays open and irrevocable until the earlier of the successful bid closing and 110 days after the petition date. Serving as back-up does not affect its right to the bid protections.
• The debtors have options if an elected sale does not close by the back-up bid termination date or the purchase agreement's outside date, or if the purchase agreement is terminated. They may close with the bidder whose qualified bid is next-highest or otherwise best and meets the mandatory conditions. Alternatively, if Ayrmid was designated back-up bidder by written notice on or before the end of the auction, they may designate its back-up bid as the successful bid, withdraw the election notice and complete the reorganization on terms reflecting any improvements Ayrmid made at the auction.
• If the debtors revert to Ayrmid's back-up bid:
  • the definitive documents, including the merger agreement, are reinstated from the date of the designation
  • RSA and DIP milestones are extended as reasonably necessary, with the consent of the Required Consenting Funded Debt Parties (not to be unreasonably withheld) and, for the Ayrmid milestones, Ayrmid
  • no resolicitation and no court order beyond the confirmation order is required

Treatment of Claims and Interests

• Distributions to the 1L lenders, noteholders and RIFA holders follow the Oct. 10, 2025 amended and restated intercreditor agreement among the 1L agent, the 2L collateral trustee and the royalty collateral agent. Note distributions also follow the Oct. 10, 2025 collateral trust agreement.
• Wilmington Savings Fund Society, FSB (WSFS) is 1L agent, trustee for both note series and 2L collateral trustee. HCR Karyopharm SPV, LLC is royalty collateral agent.
• Class 1, other secured claims (unimpaired, presumed to accept): at the debtors' option, with the consent of the Required Consenting Funded Debt Parties, payment in full in cash, return of collateral, reinstatement or other treatment that leaves the claim unimpaired.
• Class 2, other priority claims (unimpaired, presumed to accept): at the debtors' option, with the same consent, payment in full in cash or other treatment that leaves the claim unimpaired.
• Class 3, 1L term loan claims (impaired, entitled to vote):
  • Allowed at $128.98 million in principal plus default-rate interest, fees, redemption premiums and other charges under the May 8, 2024 credit agreement, amended Oct. 7, 2025 and Feb. 27, 2026.
  • In the reorganization, holders receive their pro rata share of 36.096% to 37.029% of reorganized Karyopharm stock, exchanged in the merger for merger consideration.
  • In a sale, they are paid in full in cash, including pre- and postpetition default-rate interest, fees and redemption premiums.
• Class 4, 1.5L 2028 notes claims (impaired, entitled to vote):
  • Allowed at $15.65 million in principal plus default-rate interest, fees, redemption premiums and other charges on the 9.00% convertible senior secured notes due 2028, issued under an Oct. 10, 2025 indenture.
  • In the reorganization, holders receive their pro rata share of 6.439% to 6.606% of reorganized Karyopharm stock, exchanged for merger consideration.
  • In a sale, they are paid in full in cash on the same basis as Class 3.
• Class 5, 2L 2029 notes claims (impaired, entitled to vote):
  • Allowed at $107.97 million in principal plus default-rate interest, fees, redemption premiums and other charges on the 9.00% convertible senior secured notes due 2029, issued under an Oct. 10, 2025 indenture.
  • In the reorganization, holders receive their pro rata share of 33.259% to 34.119% of reorganized Karyopharm stock, exchanged for merger consideration.
  • In a sale, they are paid in full in cash or, if the successful bid so provides, in line with the mandatory conditions.
• Class 6, RIFA claims (impaired, entitled to vote):
  • Allowed at $113.54 million plus fees, expenses and other charges due as of the petition date under the RIFA. HealthCare Royalty Management, LLC is investor representative.
  • In the reorganization, holders receive their pro rata share of the rights under the new royalty agreement.
  • In a sale, they receive their pro rata share of the successful bid's consideration for RIFA claims. It may be cash or non-cash in a form acceptable to the holders and must be worth at least $18.75 million.
• Class 7, general unsecured claims (unimpaired, presumed to accept): holders' rights are unchanged, and claims are paid or disputed in the ordinary course as if the cases had never been filed. No proof of claim is required, though the debtors may seek a bar date if a sale is pursued. Rejection damages claims fall into this class.
• Class 8, intercompany claims (impaired or unimpaired; presumed to accept or deemed to reject): at the debtors' option, with the consent of the Required Consenting Funded Debt Parties, reinstated, canceled or otherwise addressed so that holders receive no distribution.
• Class 9, existing preferred interests (impaired, deemed to reject): canceled with no distribution. The consenting preferred shareholders are nonetheless RSA parties and released parties.
• Class 10, existing common stock interests (impaired, deemed to reject): Karyopharm's common stock, quoted on Nasdaq under "KPTI," is canceled. This includes shares issuable on change-of-control vesting of restricted stock units or on option or warrant exercises before the effective date.
• Class 11, other equity interests (impaired, deemed to reject): unexercised or unvested warrants, options and other rights, and section 510(b) claims, are canceled with no distribution.
• Class 12, intercompany interests (impaired or unimpaired; presumed to accept or deemed to reject): reinstated, canceled or otherwise addressed under the restructuring transactions memorandum, with no distribution on account of the interests.
• Voting and cramdown:
  • Classes 3 through 6 vote.
  • A voting class in which no eligible holder votes is deemed to accept, and classes with no allowed claims are eliminated.
  • Subject to RSA consent rights, the debtors may change a class's treatment where section 1129(b) confirmation requires it, including by making the class unimpaired.

Restructuring Expenses and Professional Fees

• Restructuring expenses and the prepetition agents' reasonable and documented fees are paid in full in cash on the effective date under the RSA, engagement letters and DIP orders. No fee applications, itemized time records or court review are required. These expenses continue to be paid after the effective date for carrying out and defending the plan.
• Restructuring expenses cover the reasonable and documented out-of-pocket fees of:
  • the ad hoc group advisors
  • the royalty investor advisors, only to the extent of royalty investors fees under the RSA and DIP orders
  • the Ayrmid advisors, only if the bid protections are earned
• Any earned restructuring, sale, success or transaction fee is paid from DIP proceeds or cash on hand. NewCo is not responsible for these fees or for any professional fee claims.
• Estate professionals are paid from a professional fee account funded on the effective date from DIP proceeds or cash on hand. It is funded in the amount of the professionals' estimates, which are due five days before the effective date. Final fee applications are due 45 days after the effective date, and any excess goes back to the reorganized or post-effective date debtors.
• Allowed administrative claims are paid in full in cash, and ordinary-course liabilities are paid on their terms.

RSA Parties, Advisors and Consent Rights

• The RSA, attached as Exhibit B to the disclosure statement, binds Karyopharm and its subsidiaries, Ayrmid Ltd. (with its affiliates party to the merger agreement) and the consenting stakeholders, who are:
  • consenting 1L term lenders and consenting holders of the 1.5L 2028 notes and 2L 2029 notes, together the consenting funded debt parties
  • consenting royalty investors holding RIFA claims
  • consenting holders of existing preferred stock
• The ad hoc group is made up of holders, or managers of funds holding, DIP claims, 1L term loans, 1.5L 2028 notes or 2L 2029 notes. Its advisors are Latham & Watkins (counsel), Haynes and Boone (local counsel) and Houlihan Lokey (investment banker and financial advisor).
• Other advisors:
  • Hogan Lovells Cadwalader and Stifel for the consenting royalty investors
  • Paul Hastings for Ayrmid
  • Sidley Austin as the debtors' proposed counsel
  • Stretto as claims, noticing and solicitation agent
• The Required Consenting Funded Debt Parties hold the plan's main consent rights, including over:
  • the sale election
  • waivers of conditions to the effective date, and any alternative effective date
  • the treatment of Classes 1, 2, 8 and 12
  • the treatment of the Ayrmid term loan
  • the wind-down budget and the plan administrator in a sale
  • settlement of claims after the effective date
• Ayrmid shares consent rights over NewCo's form, the management incentive plan, any listing of NewCo stock, the tax structure and the indemnification entity's scope. The Required Consenting Royalty Investors consent to the sale election where the RSA requires.
• All consultation and consent rights under the RSA and the DIP documents are built into the plan and, on those rights, override the plan and the confirmation order. The debtors may modify the plan, or revoke it before confirmation, only subject to those rights.

Conditions to Effectiveness

• The effective date is the first business day after confirmation on which no stay is in effect and all conditions are met or waived. Alternatively, it is a date agreed by the debtors, the Required Consenting Funded Debt Parties and, in the reorganization, Ayrmid.
• The conditions include:
  • a final confirmation order, which also gives final approval to the disclosure statement and is consistent with the RSA
  • all required regulatory approvals obtained and applicable waiting periods expired
  • the RSA still in effect and not terminated as to the debtors, the Required Consenting Funded Debt Parties or, in the reorganization, Ayrmid
  • the DIP facility and DIP orders still in effect, with no ongoing event that, with time, would let the Required Consenting Funded Debt Parties terminate the RSA or the required DIP lenders terminate the DIP facility
  • the professional fee account funded, and restructuring expenses and the prepetition agents' fees paid in full in cash
  • in a sale or other alternative transaction, any earned bid protections paid in full in cash
  • in the reorganization, the Ayrmid term loan addressed as required; the merger agreement in effect and the merger closing at substantially the same time; the NewCo facility funded; the MF CVR agreement and new royalty agreement signed; reorganized Karyopharm stock and the merger consideration issued; and the German RemainCo winddown account funded
  • in a sale, the purchase agreement's conditions met or waived
  • no final, non-appealable order blocking the plan or the restructuring
• Any condition other than entry of the confirmation order may be waived by the debtors with the prior written consent of the Required Consenting Funded Debt Parties, subject to RSA consent rights. Waiving the condition on payment of restructuring expenses and agents' fees also requires the consent of each affected ad hoc group advisor or royalty investor advisor.

Key Dates

• On Sept. 10, 2026, the company signed the forbearance agreement and limited waiver under the indentures, and the related fee letter.
• On Nov. 2, 2026, the parties signed the RSA and the debtors dated the plan.
• The plan supplement deadline, to be set by court order, is also the last day to file a sale election notice. The supplement's contents depend on the path:
  • in the reorganization: the merger agreement, MF CVR agreement, NewCo facility documents, new royalty agreement, restructuring transactions memorandum, governance documents, board members and the schedule of rejected contracts
  • in a sale: the plan administrator and its agreement, the schedule of assumed contracts and the sale documents
• Cure notices must be served no later than 21 calendar days before the confirmation hearing.
• Ayrmid's back-up bid expires no later than 110 days after the petition date.
• Professionals' fee estimates and restructuring expense estimates are due to the debtors five days before the effective date.
• Final fee applications are due 45 days after the effective date, which is also the deadline for amending the contract schedules.
• Claim objections are due 180 days after the later of the effective date and the date a claim is filed or amended.

Releases, Exculpation and Injunction

• The plan grants debtor releases and opt-out third-party releases to the released parties, who are:
  • the debtors, the reorganized debtors or plan administrator, and NewCo
  • the prepetition agents: WSFS as 1L agent, trustee for both note series and 2L collateral trustee, and HCR Karyopharm SPV, LLC as royalty collateral agent
  • each consenting stakeholder, including the consenting royalty investors and consenting preferred shareholders
  • the DIP lenders and the DIP agent
  • Ayrmid
  • the current and former affiliates and related parties of each of these
• A holder is not a released party if it opts out on its ballot or notice of non-voting status, or if it is in a class deemed to reject and does not opt in.
• Both releases cover matters relating to the company. This includes its management and operations, its in- and out-of-court restructuring efforts, the September 2026 forbearance agreement and fee agreement, the RSA, the DIP documents and the plan.
• Debtor release: it expressly covers:
  • the prepetition funded debt and its documents
  • the DIP facility and DIP orders
  • avoidance actions, other than those asserted as counterclaims or defenses
  • lender liability claims
  • any challenge to the validity, priority or perfection of released parties' claims or liens, or any attempt to recharacterize, subordinate or avoid them
• The debtor release excludes obligations under the definitive documents arising after the effective date, and claims listed on the schedule of retained causes of action. Retained claims can never be asserted against any consenting stakeholder, the DIP agent or lenders, any prepetition agent, the ad hoc group advisors or the Ayrmid advisors.
• Third-party release: the releasing parties are the debtors, reorganized debtors, NewCo, prepetition agents, consenting stakeholders, DIP lenders and agent and Ayrmid, plus:
  • holders voting to accept
  • holders presumed to accept, abstaining or voting to reject that do not opt out
  • holders in classes deemed to reject that opt in
  • affiliates and related parties of each of these
• For claims against the debtors, the third-party release covers only conduct from the petition date through the effective date.
• Exculpation: limited to the debtors, the disinterested directors on Karyopharm's board, and any statutory committee and its members, for conduct from the petition date through the effective date.
• The debtors, consenting stakeholders, Ayrmid, the DIP lenders and agent and the prepetition agents are separately protected under section 1125(e) for good-faith solicitation and for taking part in the plan's securities issuance.
• Injunction: holders of released, settled or exculpated claims are permanently enjoined from suing on them, enforcing judgments or creating liens on account of them against the debtors, the exculpated parties and the released parties, and from asserting setoff or recoupment unless they filed a setoff motion by the confirmation date; all holders are also enjoined from interfering with implementation of the plan.
• Gatekeeper: no one may pursue a claim against the debtors, the reorganized or post-effective date debtors, the exculpated parties or the released parties over released, exculpated or enjoined matters unless the bankruptcy court first finds, after notice and a hearing, that the claim is colorable and specifically authorizes it. The court may require a proposed complaint that meets rules 8 and 9 of the Federal Rules of Civil Procedure, and must do so if a protected party or other party in interest asks by motion; the bankruptcy court has sole and exclusive jurisdiction over the underlying claim.
• Discharge: the debtors receive a discharge in the reorganization. In a sale, they do not receive a discharge under section 1141(d)(3).

Post-Emergence Governance and Securities

• NewCo and the reorganized debtors will be private companies on the effective date. NewCo stock will not be listed or registered under the Exchange Act unless Ayrmid and the Required Consenting Funded Debt Parties consent in writing. The MF CVRs will not be listed either.
• NewCo and the reorganized debtors will use commercially reasonable efforts to keep any class of reorganized Karyopharm or NewCo equity below 300 holders of record, so that section 15(d) reporting is not reinstated.
• The debtors will delist the KPTI shares from Nasdaq and deregister Karyopharm's securities. This involves filing a Form 25, a Form 15 and post-effective amendments that terminate its registration statements. In the reorganization, deregistration takes effect at the same time as the merger, to the extent permitted.
• The current directors' terms end and existing officers are removed on the effective date. The new boards of NewCo and reorganized Karyopharm and the new officers will be named, to the extent known, in the plan supplement or before the confirmation hearing.
• Management incentive plan: NewCo will adopt a plan, if any, on or after the effective date. Its terms must be acceptable to Ayrmid and the Required Consenting Funded Debt Parties and approved by the new board. It is one of only two permitted sources of dilution of the creditors' 55.0% stake.
• NewCo stock and MF CVRs (to the extent they are securities) are issued under section 1145. Where that exemption is unavailable for the merger consideration, they are issued under section 4(a)(2) or Regulation S and are then restricted securities.
• DTC and transfer agents must rely on the plan and confirmation order instead of legal opinions.

Employees, D&O Coverage and Indemnification

• The employee benefit plans assumed under the plan, including the KPTI severance plans and the severance and change-of-control payments listed on Annex A to the Ayrmid transaction term sheet, are honored by NewCo. Severance and COBRA benefits for each eligible person are capped at the Annex A amounts.
• Covered employees are all debtor employees other than Karyopharm's executive officers. For one year after the effective date, NewCo may not amend or end any KPTI severance plan in a way that hurts covered employees.
• During that year, a covered employee who suffers a qualifying termination gets severance at least as favorable as the plans provide, up to the Annex A amounts. Severance excludes equity-based awards.
• A qualifying termination means:
  • termination without cause
  • resignation for good reason
  • for employees without good-reason rights, resignation after a cut in base pay or a relocation of more than 35 miles without consent
• D&O coverage: the debtors will put existing D&O policies into six-year runoff, or buy equivalent tail coverage, at their expense, and NewCo may not reduce that coverage. Other D&O policies are rejected, while the remaining insurance policies are assumed.
• Indemnification: a newly formed indemnification entity, which may be a NewCo affiliate, takes on existing indemnification obligations to current and former directors, officers, employees and professionals. This includes D&O retentions and deductibles, with scope no less favorable than the existing provisions.
• The indemnification entity's obligations are backed by a $2.5 million intercompany promissory note from NewCo or an affiliate. The entity may take on no other debt.

Executory Contracts

• In the reorganization, contracts and leases not otherwise dealt with are deemed assumed and survive the merger unless they are on the rejection schedule.
• In a sale, contracts and leases are deemed rejected unless they are on the assumption schedule, subject to a pending assumption motion, or assumed and assigned in the sale.
• Confirmation and completion of the plan do not let counterparties terminate or modify assumed contracts or exercise default rights, and any required consents are deemed given. Assumption cures nonmonetary bankruptcy and change-of-control defaults, including those caused by the merger.
• Objections to cure notices are due by the deadline set in each notice, which must be at least 14 days after service. The debtors may amend the assumption and rejection schedules until 45 days after the effective date, consistent with the RSA.
• Rejection damages claims are due 30 days after the latest of the rejection order, the date the rejection takes effect and the effective date.

Other Implementation Terms

• German RemainCo: in the reorganization, the debtors will fund a segregated account to wind down and dissolve Karyopharm Europe GmbH in an orderly way after the effective date. The amount will be agreed by the debtors, the DIP lenders and the Required Consenting Funded Debt Parties.
• Claims administration: after the effective date, the reorganized or post-effective date debtors have exclusive authority to object to, settle and estimate claims, with the consent of the Required Consenting Funded Debt Parties.
• Setoff: the reorganized debtors may set off claims against plan distributions, but not against claims held by consenting stakeholders.