Exhibit 10.5


 





 


Panacea Acquisition Corp. II


357 Tehama Street


Floor 3


San Francisco, CA 94103


 


	EcoR1 Panacea Holdings II, LLC	January 14, 2021






357 Tehama Street


Floor 3


San Francisco, CA 94103


 


RE: Securities
Subscription Agreement


 


Ladies and Gentlemen:


 


Panacea Acquisition Corp. II, a Cayman Islands
exempted company (the “Company”), is pleased to accept the offer EcoR1 Panacea Holdings II, LLC, a Delaware
limited liability company (the “Subscriber” or “you”), has made to subscribe for (a) 2,300,000
of the Company’s Class B ordinary shares (the “Founder Shares”), U.S. $0.0001 par value per share (the
“Class B Shares”), up to 300,000 of which are subject to complete or partial forfeiture by you if the underwriters
of the Company’s initial public offering (“IPO”), if any, do not fully exercise their over-allotment option
(the “Over-allotment Option”) and (b) 3,450,000 of the Company’s Class F Ordinary Shares (the “Alignment
Shares”), par value $0.0001 par value per share (the “Class F Shares”), up to 450,000 of which are
subject to complete or partial forfeiture by you if the underwriters of the Company’s IPO, if any, do not fully exercise
their over-allotment option.


 


For the purposes of this agreement (this “Agreement”),
references to “Ordinary Shares” are to, collectively, the Class B Shares, the Class F Shares and the Company’s
Class A ordinary shares, U.S. $0.0001 par value per share (the “Class A Shares”). Upon certain terms and conditions,
the Class B Shares and the Class F Shares may automatically convert into Class A Shares. Unless the context otherwise requires,
as used herein (i) “Founder Shares” shall be deemed to include any Class A Shares issued upon conversion of
the Class B Shares comprising the Founder Shares, (ii) “Alignment Shares” shall be deemed to include any Class
A Shares issued upon conversion of the Class F Shares comprising the Alignment Shares and (iii) “Shares” shall
be deemed to include the Founder Shares and the Alignment Shares. The terms on which the Company is willing to issue the Shares
to the Subscriber, and the Company and the Subscriber’s agreements regarding such Shares, are as follows:


 



1. 
Subscription of Shares.


 


For the sum of U.S. $25,000, which the Company
acknowledges has been remitted at the Company’s direction for offering costs, the Company hereby issues the Shares to the
Subscriber, and the Subscriber hereby subscribes for the Shares from the Company, of which 300,000 Founder Shares and 450,000 Alignment
Shares are subject to forfeiture, on the terms and subject to the conditions set forth in this Agreement. Concurrently with the
Subscriber’s execution of this Agreement, the Company shall register the Shares in the name of the Subscriber on the register
of members of the Company. All references in this Agreement to Shares being forfeited shall take effect as surrenders for no consideration
of such shares as a matter of Cayman Islands law.


 



     


     


    




 


2. 
Representations, Warranties and Agreements.


 


2.1 
Subscriber’s Representations, Warranties and Agreements. To induce the Company to issue the Shares to the Subscriber,
the Subscriber hereby represents and warrants to the Company and agrees with the Company as follows:


 


2.1.1 
No Government Recommendation or Approval. The Subscriber understands that no federal or state agency has passed upon or
made any recommendation or endorsement of the offering of the Shares.


 


2.1.2 
No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions
contemplated hereby do not violate, conflict with or constitute a default under (i) the limited liability company agreement of
the Subscriber, (ii) any agreement, indenture or instrument to which the Subscriber is a party or (iii) any law, statute, rule
or regulation to which the Subscriber is subject, or any agreement, order, judgment or decree to which the Subscriber is subject.


 


2.1.3 
Organization and Authority. The Subscriber is a Delaware limited liability company, validly existing and in good standing
under the laws of the State of Delaware and possesses all requisite power and authority necessary to carry out the transactions
contemplated by this Agreement. Upon execution and delivery by you, this Agreement is a legal, valid and binding agreement of the
Subscriber, enforceable against the Subscriber in accordance with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance or similar laws affecting the enforcement of creditors’ rights generally and
subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).


 


2.1.4 
Experience, Financial Capability and Suitability. The Subscriber is: (i) sophisticated in financial matters and is able
to evaluate the risks and benefits of the investment in the Shares and (ii) able to bear the economic risk of its investment in
the Shares for an indefinite period of time because the Shares have not been registered under the Securities Act (as defined below)
and therefore cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is
available. The Subscriber is capable of evaluating the merits and risks of its investment in the Company and has the capacity to
protect its own interests. The Subscriber must bear the economic risk of this investment until the Shares are sold
pursuant to: (i) an effective registration statement under the Securities Act or (ii) an exemption from registration available with respect to such sale.


 



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2.1.5 
Access to Information; Independent Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity
to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as
the finances, operations, business and prospects of the Company, and the opportunity to obtain additional information to verify
the accuracy of all information so obtained. In determining whether to make this investment, the Subscriber has relied solely on
the Subscriber’s own knowledge and understanding of the Company and its business based upon the Subscriber’s own due
diligence investigation and the information furnished pursuant to this paragraph. The Subscriber understands that no person has
been authorized to give any information or to make any representations which were not furnished pursuant to this Section 2 and
the Subscriber has not relied on any other representations or information in making its investment decision, whether written or
oral, relating to the Company, its operations and/or its prospects.


 


2.1.6  Private Placement.
The Subscriber represents that it is an “accredited investor” as such term is defined in Rule 501(a) of
Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and acknowledges the
sale contemplated hereby is being made in reliance on a private placement exemption applicable to “accredited
investors” within the meaning of Section 501(a) of Regulation D under the Securities Act or similar exemptions under
state law.


 


2.1.7 
Investment Purposes. The Subscriber is subscribing for the Shares solely for investment purposes, for the Subscriber’s
own account and not for the account or benefit of any other person, and not with a view towards the distribution or dissemination
thereof that would result in a violation of the Securities Act. The Subscriber did not decide to enter into this Agreement as a
result of any general solicitation or general advertising within the meaning of Rule 502 of Regulation D under the Securities Act.


 


2.1.8 
Restrictions on Transfer; Shell Company. The Subscriber understands the Shares are being offered in a transaction not involving
a public offering within the meaning of the Securities Act. The Subscriber understands the Shares will be “restricted securities”
within the meaning of Rule 144(a)(3) under the Securities Act and the Subscriber understands that the certificates or book-entries
representing the Shares will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer,
resell, pledge or otherwise transfer the Shares, such Shares may be offered, resold, pledged or otherwise transferred only pursuant
to: (i) registration under the Securities Act, or (ii) an available exemption from registration. The Subscriber agrees that if
any transfer of its Shares or any interest therein is proposed to be made, as a condition precedent to any such transfer, the Subscriber
may, at the Company’s option, be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent
registration or an exemption, the Subscriber agrees not to resell the Shares. The Subscriber further acknowledges that because
the Company is a shell company, Rule 144 may not be available to the Subscriber for the resale of the Shares until at least one
year following consummation of the initial business combination of the Company (which may not occur), despite technical compliance
with the requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.


 



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2.1.9 
No Governmental Consents. No governmental, administrative or other third party consents or approvals are required, necessary
or appropriate on the part of the Subscriber in connection with the transactions contemplated by this Agreement.


 


2.2 
Company’s Representations, Warranties and Agreements. To induce the Subscriber to subscribe for the Shares, the Company
hereby represents and warrants to the Subscriber and agrees with the Subscriber as follows:


 


2.2.1 
Incorporation and Corporate Power. The Company is a Cayman Islands exempted company and is qualified to do business in every
jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial
condition, operating results or assets of the Company. The Company possesses all requisite corporate power and authority necessary
to carry out the transactions contemplated by this Agreement.


 


2.2.2  No Conflicts. The execution,
delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not
violate, conflict with or constitute a default under (i) the Company’s Memorandum and Articles of Association (the “Memorandum and Articles”), (ii)
any agreement, indenture or instrument to which the Company is a party or (iii) any law, statute, rule or regulation to which
the Company is subject, or any agreement, order, judgment or decree to which the Company is subject.


 


2.2.3 
Title to Shares. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Memorandum and Articles,
and registration in the register of members of the Company, the Shares will be duly and validly issued, fully paid and nonassessable.
Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Memorandum and Articles, the Subscriber will
have or receive good title to the Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer
restrictions hereunder and under the other agreements to which the Shares may be subject, (b) transfer restrictions under federal
and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.


 


2.2.4 
No Adverse Actions. There are no actions, suits, investigations or proceedings pending, threatened against or affecting
the Company which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated
by this Agreement or (ii) question the validity or legality of any transactions or seeks to recover damages or to obtain other
relief in connection with any transactions.


 


2.2.5 
Authorization. The Class A Shares issuable upon conversion of the Shares have been duly authorized and reserved for issuance
upon such conversion.


 


3. 
Forfeiture of Shares.


 


3.1 Partial or No Exercise of
the Over-allotment Option. In the event the Over-allotment Option granted to the underwriters of the IPO is not exercised
in full, the Subscriber acknowledges and agrees that it (or, if applicable, it and any transferees of Shares) shall
automatically forfeit at the time such Over-allotment Option expires (or earlier if the underwriters of the IPO waive their
ability to exercise such Over-allotment Option) any and all rights to such number of Shares (up to an aggregate of 300,000
Founder Shares and 450,000 Alignment Shares and pro rata based upon the percentage of the Over-allotment Option exercised)
such that immediately following such forfeiture, the aggregate number of Class B Shares and Class F Shares will equal 10%,
and 15%, respectively, of the issued and outstanding Ordinary Shares immediately following the IPO (excluding the Shares to
be sold in a private placement substantially concurrently with the closing of the IPO).


 



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3.2 
Termination of Rights as Shareholder. If any of the Shares are forfeited in accordance with this Section 3, then after such
time the Subscriber (or successor in interest), shall no longer have any rights as a holder of such forfeited Shares, and the Company
shall take such action as is appropriate to cancel such forfeited Shares.


 


4.  Waiver of Liquidation Distributions; Redemption
Rights. In connection with the Shares subscribed for pursuant to this Agreement, the Subscriber hereby waives any and all
right, title, interest or claim of any kind in or to any distributions by the Company from the trust account which will be established
for the benefit of the Company’s public shareholders and into which substantially all of the proceeds of the IPO will be
deposited (the “Trust Account”), in the event of a liquidation of the Company upon the Company’s failure
to timely complete an initial business combination. For purposes of clarity, in the event the Subscriber purchases securities
in the IPO or in the aftermarket, any Class A Shares so purchased shall be eligible to receive any liquidating distributions by
the Company. However, in no event will the Subscriber have the right to redeem any Ordinary Shares held by it into funds held
in the Trust Account upon the successful completion of an initial business combination.


 


5. 
Restrictions on Transfer.


 


5.1  Securities Law Restrictions.
In addition to any restrictions to be contained in that certain letter agreement (commonly known as an “Insider Letter”)
to be dated on or prior to the closing of the IPO by and among the Subscriber, the Company and other parties thereto, the Subscriber
agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Shares unless, prior thereto
(a) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with respect
to the Shares proposed to be transferred shall then be effective or (b) the Company has received, if requested by the Company,
an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction
is exempt from registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder
and with all applicable state securities laws.


 


5.2  Lock-up. The
Subscriber acknowledges that the Shares will be subject to lock-up provisions (the “Lock-up”) contained in
the Insider Letter. Pursuant to the Insider Letter, the Subscriber will agree (subject to certain customary exceptions) not
to sell, transfer, pledge, hypothecate or otherwise dispose of all or any of (i) the Founder Shares until the earlier to
occur of: (a) one year after the completion of the Company’s initial business combination, (b) if the last sale price
of the Class A Shares equals or exceeds U.S. $12.00 per share (as adjusted for share sub-divisions, share dividends, rights
issuances, consolidations, reorganizations, recapitalizations and other similar transactions) for any 20 trading days within
any 30-trading day period commencing at least 150 days after the Company’s initial business combination and (c) the
date on which the Company consummates a merger, share exchange, asset acquisition, share purchase, reorganization or other
similar transaction after the Company’s initial business combination that results in all of the Company’s
shareholders having the right to exchange their Ordinary Shares for cash, securities or other property and (ii) the Alignment
Shares until the earlier to occur of: (a) their conversion into Class A ordinary shares and (b) the date on which the Company
consummates a merger, share exchange, asset acquisition, share purchase, reorganization or other similar transaction after
the Company’s initial business combination that results in both a change of control and all of the Company’s
shareholders having the right to exchange their Ordinary Shares for cash, securities or other property.


 



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5.3 
Restrictive Legends. Any certificates representing the Shares shall have endorsed thereon legends substantially as follows:


 


“THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE
SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE
OPINION OF COUNSEL (IF THE COMPANY SO REQUESTS), IS AVAILABLE.”


 


“THE SECURITIES REPRESENTED HEREBY
ARE SUBJECT TO A LOCKUP AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE LOCKUP.”


 


5.4 
Additional Shares or Substituted Securities. In the event of the declaration of a share capitalization, the declaration
of an extraordinary dividend payable in a form other than Ordinary Shares, a spin-off, a share sub-division, an adjustment in conversion
ratio, a recapitalization or a similar transaction affecting the Company’s outstanding Ordinary Shares without receipt of
consideration, any new, substituted or additional securities or other property which are by reason of such transaction distributed
with respect to any Shares subject to this Section 5 or into which such Shares thereby become convertible shall immediately be
subject to this Section 5 and Section 3. Appropriate adjustments to reflect the distribution of such securities or property shall
be made to the number and/or class of Shares subject to this Section 5 and Section 3.


 


5.5 
Registration Rights. The Subscriber acknowledges that the Shares are being subscribed for pursuant to an exemption from
the registration requirements of the Securities Act and will become freely tradable only after certain conditions are met or they
are registered pursuant to a registration rights agreement to be entered into with the Company prior to the closing of the IPO
(the “Registration Rights Agreement”).


 



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6. 
Other Agreements.


 


6.1 
Further Assurances. The Subscriber agrees to execute such further instruments and to take such further action as may reasonably
be necessary to carry out the intent of this Agreement.


 


6.2 
Notices. All notices, statements or other documents which are required or contemplated by this Agreement shall be in writing
and delivered (i) personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic
transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such
other address or fax number as may be designated in writing by such party, or (iii) by electronic mail, to the electronic mail
address most recently provided to such party or such other electronic mail address as may be designated in writing by such party.
Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally,
on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business
day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.


 


6.3 
Entire Agreement. This Agreement, together with that certain Insider Letter to be entered into between the Subscriber and
the Company and the Registration Rights Agreement, each substantially in the form to be filed as an exhibit to the Registration
Statement on Form S-1 associated with the IPO, embodies the entire agreement and understanding between the Subscriber and the Company
with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the
subject matter hereof. No statement, representation, warranty, covenant or agreement of any kind not expressly set forth in this
Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.


 


6.4 
Modifications and Amendments. The terms and provisions of this Agreement may be modified or amended only by written agreement
executed by all parties hereto.


 


6.5 
Waivers and Consents. The terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted,
only by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent
shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement,
whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which
it was given, and shall not constitute a continuing waiver or consent.


 


6.6 
Assignment. The rights and obligations under this Agreement may not be assigned by either party hereto without the prior
written consent of the other party.


 


6.7 
Benefit. All statements, representations, warranties, covenants and agreements in this Agreement shall be binding on the
parties hereto and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing
in this Agreement shall be construed to create any rights or obligations except among the parties hereto, and no person or entity
shall be regarded as a third-party beneficiary of this Agreement.


 



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6.8 
Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with
and governed by the laws of New York applicable to contracts wholly performed within the borders of such state.


 


6.9 
Severability. In the event that any court of competent jurisdiction shall determine that any provision, or any portion thereof,
contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited
to the extent that such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. In
the event that such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of
this Agreement shall nevertheless remain in full force and effect.


 


6.10 
No Waiver of Rights, Powers and Remedies. No failure or delay by a party hereto in exercising any right, power or remedy
under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or
remedy of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any
abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or
further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto
shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party
not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any
other or further action in any circumstances without such notice or demand.


 


6.11
Survival of Representations and Warranties. All representations and warranties made by the parties hereto in this Agreement
or in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery
hereof and any investigations made by or on behalf of the parties.


 


6.12 
No Broker or Finder. Each of the parties hereto represents and warrants to the other that no broker, finder or other financial
consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to
create any liability on the other. Each of the parties hereto agrees to indemnify and save the other harmless from any claim or
demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been
employed by or on behalf of such party and to bear the cost of legal expenses incurred in defending against any such claim.


 


6.13 
Headings and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference
only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.


 


6.14  Counterparts. This
Agreement may be executed in one or more counterparts, all of which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it
being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by
facsimile transmission or any other form of electronic delivery, such signature shall create a valid and binding obligation
of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature
page were an original thereof.


 



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6.15  Construction. The parties
hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by the parties hereto and no presumption or burden of proof will
arise favoring or disfavoring any party hereto because of the authorship of any provision of this Agreement. The words “include,”
“includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns
in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will
be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,”
“herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to
this Agreement as a whole and not to any particular subdivision unless expressly so limited. The parties hereto intend that each
representation, warranty, and covenant contained herein will have independent significance. If any party hereto has breached any
representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty
or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such party hereto has
not breached will not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty,
or covenant.


 


6.16 
Mutual Drafting. This Agreement is the joint product of the Subscriber and the Company and each provision hereof has been
subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party
hereto.


 


6.17 
Surrender of Class B Ordinary Share. The Subscriber hereby surrenders to the Company for cancellation and for nil consideration
one Class B ordinary share of a par value US$0.0001 standing in its name in the register of members of the Company.


 


7. 
Voting and Tender of Shares. The Subscriber agrees to vote the Shares in favor of an initial business combination that the
Company negotiates and submits for approval to the Company’s shareholders and shall not seek redemption or repurchase with
respect to any of the Shares in connection with an initial business combination or any amendment to the Memorandum and Articles,
as amended, prior to an initial business combination. Additionally, the Subscriber agrees not to tender any Shares in connection
with a tender offer presented to the Company’s shareholders in connection with an initial business combination negotiated
by the Company.


 


8. 
Indemnification. Each party shall indemnify the other against any loss, cost or damages (including reasonable attorney’s
fees and expenses) incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in
this Agreement.


 


[Signature Page Follows]


 



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If the foregoing accurately sets forth our
understanding and agreement, please sign the enclosed copy of this Agreement and return it to us.


 


	 	Very truly yours,
	 	 	 	 
	 	Panacea Acquisition Corp. II
	 	 
	 	By:	/s/ Scott Perlen
	 	 	Name: 	Scott Perlen
	 	 	Title:	Chief Financial Officer






 


	EcoR1 Panacea Holdings II, LLC	 
	 	 
	By:	/s/ Oleg Nodelman	 
	 	Name: 	Oleg Nodelman	 
	 	Title:	Authorized Signatory	 



 








[Signature Page to Securities Subscription
Agreement]