PRINCIPIA BIOPHARMA INC. Item 1.01 Entry into a Material Definitive Agreement.
On
Pursuant to the Merger Agreement, upon the terms and subject to the conditions
thereof, Purchaser will commence a cash tender offer (the "Offer"), to acquire
all of the outstanding shares of common stock of the Company,
The obligation of Purchaser to purchase Shares tendered in the Offer is subject to the conditions set forth in the Merger Agreement, including that the number of Shares validly tendered in accordance with the terms of the Offer and not validly withdrawn, when considered together with all other Shares (if any) otherwise beneficially owned by Parent or any of its wholly owned subsidiaries (including Purchaser) (but excluding Shares tendered pursuant to guaranteed delivery procedures that have not yet been received, as defined by Section 251(h)(6) of the of the Delaware General Corporation Law (the "DGCL")), would represent one more than 50% of the total number of Shares outstanding at the time of the expiration of the Offer (the "Minimum Condition").
Following the completion of the Offer and subject to the satisfaction or waiver
of certain conditions set forth in the Merger Agreement, Purchaser will merge
with and into the Company, with the Company surviving as a wholly owned
subsidiary of Parent (the "Merger"). Purchaser will effect the Merger after
consummation of the Offer pursuant to Section 251(h) of the DGCL. At the
effective time of the Merger (the "Effective Time"), the Shares then outstanding
(other than Shares (a) held by the Company (or in the Company's treasury),
Parent, Purchaser, any other direct or indirect wholly owned subsidiary of
Parent, or by stockholders of the Company who have properly exercised and
perfected their statutory rights of appraisal under
Each of the Company's stock options (the "Company Options") that is outstanding as of immediately prior to the Effective Time shall accelerate and become fully vested and exercisable effective immediately prior to, and contingent upon, the Effective Time. As of the Effective Time, each Company Option that is then outstanding and unexercised shall be cancelled and converted into the right to receive cash in an amount equal to the product of (i) the total number of Shares subject to the vested Company Option immediately prior to the Effective Time (taking into account any acceleration of vesting), multiplied by (ii) the excess (if any), of (x) the Merger Consideration over (y) the exercise price payable per Share under such Company Option. Any Company Option that has an exercise price that equals or exceeds the Merger Consideration shall be canceled for no consideration. The Company's repurchase rights with respect to any Shares previously issued upon the "early exercise" of Company Options will terminate immediately prior to and contingent upon the Effective Time.
At the Effective Time, the warrants to purchase Shares (the "Company Warrants") will be converted into the right to receive the Merger Consideration less the applicable exercise price in respect of the Shares underlying such Company Warrants, and the holders of such Company Warrants, in lieu of Shares immediately theretofore purchasable and receivable upon the exercise of the rights represented by the Company Warrant, will be entitled only to receive the Merger Consideration less the applicable exercise price in respect of each share of Company Common Stock underlying such Company Warrants and will have no other rights pursuant to each such holder's ownership of such Company Warrants.
The Merger Agreement includes representations, warranties and covenants of the parties customary for a transaction of this nature. From the date of the Merger Agreement until the earlier of the Effective Time and the termination of the Merger Agreement, the Company has agreed, subject to certain exceptions, to operate its business in the ordinary course consistent with past practice and has agreed to certain other operating covenants, as set forth more fully in the Merger Agreement. The Company has also agreed not to directly or indirectly solicit or encourage discussions or negotiations with any third party regarding acquisition proposals. Notwithstanding these restrictions, the Company may under certain circumstances provide, pursuant to an acceptable confidentiality agreement, information to and engage in or otherwise participate in discussions or negotiations with third parties with respect to an unsolicited, bona fide written alternative acquisition proposal that the board of directors of the Company has determined in good faith, after consultation with its financial advisors and outside legal counsel, constitutes or could reasonably be expected to lead to a Superior Offer (as defined in the Merger Agreement) and that failure to take such action would be inconsistent with the board's fiduciary duties under applicable legal requirements.
The Merger Agreement includes a remedy of specific performance for the Company,
Parent and Purchaser. The Merger Agreement also includes customary termination
provisions for both the Company and Parent and provides that, in connection with
the termination of the Merger Agreement under specified circumstances, including
termination by the Company to accept and enter into a definitive agreement with
respect to an unsolicited Superior Offer, the Company will be required to pay a
termination fee of an amount in cash equal to
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conditions, including the Company's compliance with certain procedures set forth in the Merger Agreement, a determination by the board of directors of the Company that the failure to take such action would be inconsistent with the board of directors' fiduciary duties to the Company's stockholders under applicable legal requirements and the payment of the Termination Fee by the Company.
The foregoing description of the Merger Agreement is not complete and is qualified in its entirety by reference to the Merger Agreement, which is attached as Exhibit 2.1 to this report and incorporated herein by reference. The Merger Agreement and the foregoing description of such agreement have been included to provide investors and stockholders with information regarding the terms of such agreements. The assertions embodied in the representations and . . .
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On
Item 8.01 Other Events.
On
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits Exhibit Number Description 2.1* Agreement and Plan of Merger, dated as ofAugust 16, 2020 , by and amongPrincipia Biopharma Inc. , Sanofi andKortex Acquisition Corp. 99.1 Joint Press Release of Sanofi andPrincipia Biopharma Inc. , datedAugust 17, 2020 104 Cover Page Interactive Date File (embedded within the Inline XBRL document)
* Schedules omitted pursuant to Item 601(b)(2) of Regulation S-K.
agrees to furnish supplementally a copy of any omitted schedule to the
request. Forward-Looking Statements
This communication contains forward-looking statements. Forward-looking statements are statements that are not historical facts and may include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential plans, and future performance. Forward-looking statements are generally identified by the words "expects", "anticipates", "believes", "intends", "estimates", "plans", "will be" and similar expressions. Although Company management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Company, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking
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information and statements. These risks and uncertainties include among other
things, risks relating to the ability to complete and the timing of completion
of the transactions contemplated by the Merger Agreement including the parties'
ability to satisfy the conditions to the consummation of the Offer and the other
conditions set forth in the Merger Agreement, the risk that stockholder
litigation in connection with the proposed transaction may result in significant
costs and the possibility of any termination of the Merger Agreement; the
uncertainties inherent in research and development, including future clinical
data and analysis, regulatory obligations and oversight by regulatory
authorities, such as the FDA, and risks associated with the Company's
intellectual property. The forward-looking statements contained in this
communication are based on current expectations and assumptions that are subject
to risks and uncertainties which may cause actual results to differ materially
from the forward-looking statements. Actual results may differ materially from
current expectations because of risks associated with uncertainties as to the
timing of the tender offer and the merger; the risk that competing offers or
acquisition proposals will be made; the possibility that various conditions to
the consummation of the tender offer or the merger may not be satisfied or
waived, including that a governmental entity may prohibit, delay or refuse to
grant approval for the consummation of the tender offer or the merger; the
effects of disruption from the transactions of the Company's business and the
fact that the announcement and pendency of the transactions may make it more
difficult to establish or maintain relationships with employees or vendors. The
risks and uncertainties may be amplified by the COVID-19 pandemic, which has
caused significant economic uncertainty. The extent to which
the COVID-19 pandemic impacts the Company's businesses, operations, and
financial results, including the duration and magnitude of such effects, will
depend on numerous factors, which are unpredictable, including, but not limited
to, the duration and spread of the outbreak, its severity, the actions to
contain the virus or treat its impact, and how quickly and to what extent normal
economic and operating conditions can resume. While the list of factors
presented here is representative, no list should be considered a statement of
all potential risks, uncertainties or assumptions that could have a material
adverse effect on the companies' consolidated financial condition or results of
operations. The foregoing factors should be read in conjunction with the risks
and cautionary statements discussed or identified in in the Company's public
filings with the
About the Offer
The Offer for the outstanding shares of Company common stock referenced in this
communication has not yet commenced. This communication is for informational
purposes only and is neither an offer to purchase nor a solicitation of an offer
to sell securities, nor is it a substitute for the tender offer materials that
will be filed with the
THE OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT ON SCHEDULE 14D-9 WILL CONTAIN IMPORTANT INFORMATION. COMPANY STOCKHOLDERS ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE (AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME) BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION THAT HOLDERS OF PRINCIPIA SECURITIES SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR SECURITIES.
The Offer to Purchase, the related Letter of Transmittal and certain other offer
documents, as well as the Solicitation/Recommendation Statement, will be made
available to all stockholders of the Company at no expense to them. The Tender
Offer Statement and the Solicitation/Recommendation Statement will be available
free of charge at the
Additional Information
In addition to the Solicitation/Recommendation Statement that the Company will
file, the Company files annual, quarterly and current reports, proxy statements
and other information with the
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