Rallybio Corporation (NASDAQ:RLYB) saw its shares jump 47.4% on Monday after the company disclosed it is due to receive a $50 million termination fee tied to the collapse of its planned merger with Candid Therapeutics, Inc.
Candid terminated the Merger Agreement on May 3, 2026, after entering into an alternative agreement with UCB S.A. Under the merger agreement that Rallybio and Candid originally executed on March 1, 2026, Rallybio is entitled to a $50 million parent termination fee as a result of the deal’s cancellation.
In connection with the termination, the three parties - Rallybio, Candid, and UCB - executed a waiver on May 1, 2026. That waiver documents Rallybio’s agreement to waive certain rights arising under the merger agreement and its consent to receive the termination fee and an expense reimbursement on the first business day after the termination. The waiver also provides that Rallybio will release all claims against Candid, UCB, and their affiliates relating to the merger agreement, provided the company receives the termination fee and the expense reimbursement.
Following the termination, Rallybio said it plans to withdraw the registration statement on Form S-4 that it initially filed with the Securities and Exchange Commission on March 17, 2026 and later amended on April 24, 2026.
The company’s stock reaction reflected the market pricing of the immediate cash payment tied to the terminated transaction. The contractual framework set on March 1 governs the parent termination fee entitlement, while the May 1 waiver lays out the conditions for payment timing and the release of claims.
Rallybio’s announcement is narrowly focused on the mechanics of the termination fee, the waiver and the related SEC filing withdrawal. The company’s intended withdrawal of the S-4 indicates it will step back from the previously contemplated transaction documentation filed with regulators.
Contextual note: The facts reported here are limited to the statements about the termination, the waiver terms and the planned withdrawal of the Form S-4; no additional outcomes or implications are asserted beyond those statements.