Echo Lake Capital Offers to Acquire Quince Therapeutics, Inc.

• Offers $1.60 per share in cash
• Offer represents 90% premium to yesterday's closing price
• Stock currently trades below its current cash and investments balance of $2.55 per share
• Company also has other assets including earnouts and NOLs
• Company is not developing or selling any drugs
• Offer not contingent on outside financing

NEW YORK, NY / ACCESSWIRE / March 21, 2023 / Earlier today Echo Lake Capital issued a letter to the Board of Directors of Quince Therapeutics, Inc. (NASDAQ:QNCX). The letter described a proposal to acquire all the company's common stock for $1.60 per share in cash.

A full copy of the letter can be found below:

CONTACT:
Ephraim Fields
ef@echolakecapital.com

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March 21, 2023
To The Board Of Directors:
David Lamond
Dirk Thye
June Bray
Philip Low
Margaret McLoughlin
Una Ryan
Christopher Senner

Echo Lake Capital is pleased to submit this proposal (the "Proposal") under which we would acquire all the outstanding Common Stock of Quince Therapeutics, Inc. ("Quince" or the "Company") we do not own for a price of $1.60 per share in cash.

Our Proposal represents a premium of 90% to the Company's closing stock price yesterday, which we believe is very compelling as it provides shareholders with a highly certain and significant return and the ability to obtain liquidity for their shares. Our Proposal is not contingent on outside financing and we believe we can complete customary diligence and negotiate definitive documentation within 30 days.

As one of your largest shareholders we believe your stock is severely undervalued. The Company currently has (i) approximately $2.55 per share of net cash and investments, (ii) no drugs being actively marketed or developed that require cash expenditures (Quince is essentially a company without any products), (iii) whatever consideration the Company receives for out-licensing NOV004 (an asset the Company acquired last year for $15 million), (iv) the potential to receive up to $150 million (which equates to up to $4.10 per share) in milestone payments, and (v) $225 million of federal net operating loss carryforwards. However, Quince's stock currently trades at 84c, has an equity market cap of only $31 million (which is significantly less than its cash and investments balance alone) and is in danger of being delisted.

Unfortunately, we believe it will be extremely difficult for the Board to significantly shrink this valuation gap because Quince (i) has an uncertain future since the company is not marketing or developing any products, (ii) is a tiny company with a limited institutional following, and (iii) has historically disappointed investors and currently lacks credibility in the investment community. We note that the Company's stock price is down 70% since its acquisition of NOV004/Novosteo in May 2022 and down 95% since its IPO in 2019.

We believe our Proposal is in the best interests of all shareholders and believe it offers shareholders a significantly more attractive risk/reward scenario than the Board's current plan. Because we so strongly believe investors will favor a sale of the Company, we highly encourage you not to pursue any significant transactions (besides the out-licensing of NOV004) while our Proposal is outstanding.

Please be aware that this Proposal is an expression of interest only, and we reserve the right to withdraw or modify our Proposal in any manner. No legal obligation with respect to a transaction shall arise unless and until execution of mutually acceptable definitive documentation.

Should you have any questions, please do not hesitate to contact us. We look forward to hearing from you.

Sincerely,
Ephraim Fields
Echo Lake Capital

SOURCE: Echo Lake Capital