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On May 29, 2007, the
Reporting Persons and Bioenvision entered into an Agreement and Plan of
Merger (the
Merger Agreement
) pursuant to
which Wichita Bio effectuated a tender offer (the
Offer
)
to acquire (i) all of the issued and outstanding common stock, $0.001 par
value per share (the
Common Stock
)
of Bioenvision, including all rights to purchase Series A Junior
Participating Preferred Stock issued pursuant to the Rights Agreement, dated
as of November 17, 2004, between Bioenvision and American Stock Transfer
& Trust Company as rights agent, (together, the
Common
Shares
) at $5.60 per share in cash (the
Common
Stock Offer Price
) and (ii) all of the issued and outstanding
shares of Series A Convertible Participating Preferred Stock, par value
$0.001 per share, (the
Preferred Shares
,
and together with the Common Shares, the
Bioenvision Shares
)
of Bioenvision at $11.20 per share in cash (the
Preferred
Stock Offer Price
), plus all accrued but unpaid dividends. On July 2, 2007, the Reporting Persons
waived the condition to the Offer requiring that there be validly tendered
and not withdrawn prior to the Expiration Date (as defined in the Merger
Agreement) that number of Common Shares which, when added to any Common
Shares owned by the Reporting Persons, represents a majority of the issued
and outstanding Common Shares (assuming, for purposes of such calculation,
the exercise or conversion of all vested in-the-money options and
in-the-money warrants). Of note, the
Merger Agreement contemplates that in-the-money options and in-the-money
warrants will be cashed out at their spread, so the Reporting Persons do not
expect that many options or any warrants will be exercised prior to a vote on
the Merger Agreement.
The Offer expired at
12:01 a.m. (New York City time) on July 10, 2007. On July 10, 2007, Wichita Bio accepted for
payment 8,398,098 Common Shares and 2,250,000 Preferred Shares that had been
tendered and not withdrawn from the Offer, representing a total of 15.3% of
the 55,035,740 outstanding Common Shares as of June 27, 2007 and 100% of the
outstanding Preferred Shares as of June 27, 2007. Included in these figures are all Common
Shares tendered by notice of guaranteed delivery that were validly delivered
within three NASDAQ Global Market trading days after the July 10, 2007
expiration date of the Offer, as required by the terms of the notice of
guaranteed delivery. Genzyme provided all funding required by Wichita Bio in
connection with the acceptance for payment of the Common and Preferred Shares
on July 10, 2007 from cash on hand.
As an inducement to
enter into the Merger Agreement, and in consideration thereof, Genzyme and
Wichita Bio entered into Tender and Voting Agreements (each, a
Tender and Voting Agreement
), dated as of the date of the
Merger Agreement, with each of Perseus-Soros Biopharmaceutical Fund L.P.,
Andrew Schiff, Christopher Wood, David Luci, Hugh Griffith, Ian Abercrombie,
James Scibetta, Joseph Cooper, Kristen Dunker, Michael Kauffman, Robert
Sterling, Steven Elms and Thomas Scott Nelson (each, a
Stockholder
and, collectively, the
Stockholders
). Pursuant to the Tender and Voting
Agreements, the Stockholders tendered 5,434,409 Common Shares (representing
9.9% of the 55,035,740 outstanding Common Shares as of June 27, 2007) and
2,250,000 Preferred Shares (representing 100% of the outstanding Preferred
Shares as of June 27, 2007). As of
July 10, 2007, the Stockholders held options to purchase 5,058,575 Common
Shares and warrants to purchase 75,009 Common Shares (the
Stockholders Options and Warrants
).
Pursuant to the Tender
and Voting Agreements, each Stockholder granted to each of Genzyme and Wichita
Bio an irrevocable option to purchase the Common Shares and Preferred Shares
held by such Stockholder, and any or all Common Shares issued or issuable
upon the exercise of any options or warrants, subject to the terms of the
Tender and Voting Agreement, for a purchase price equal to the Common Stock
Offer Price for the Common Shares and the Preferred Stock Offer Price for the
Preferred Shares. In addition,
pursuant to the Tender and Voting Agreement, each of the Stockholders agreed
to, at any meeting of the stockholders of Bioenvision however called (or any
action by written consent in lieu of a meeting) with respect to the Merger or
the Merger Agreement or any adjournment thereof, appoint Genzyme as proxy for
the Stockholder to vote and exercise all voting and related rights of such
Stockholder of its beneficially held Common Shares and Preferred Shares in
favor of the adoption and approval by Bioenvision of the Merger and the
Merger Agreement and each of the transactions contemplated thereby.
Shared dispositive
power with respect to the Stockholders Options and Warrants may be deemed to
have been acquired through execution of the Tender and Voting Agreements.
Genzyme has not expended any funds in connection with the execution of the
Tender and Voting Agreements, except for the transaction expenses (funded
from Genzymes working capital) otherwise to be incurred in connection with
the Offer and the Merger.
Genzyme and Wichita Bio
estimate that the total cash amount required to purchase the Shares tendered
pursuant to the Offer and to cover estimated fees and expenses will be
approximately U.S. $80,000,000. Genzyme or one of its affiliates will provide
all remaining funding required by Wichita Bio in connection with the Merger
from cash on hand.
A copy of the Merger Agreement is attached is
included as Exhibit 2 to this Schedule 13D. A form of the Tender and Voting
Agreement is included as Annex II to the Merger Agreement. References to, and descriptions of, the
Merger Agreement and the Tender and Voting Agreements as set forth above in
this Item 3 are qualified in their entirety by reference to the copies of the
Merger Agreement and the form of Tender and Voting Agreement included as
Exhibit 2 to this Schedule 13D and which are incorporated herein in their entirety
by this reference. The information set
forth and/or incorporated by reference in Item 6 is hereby incorporated by
reference into this Item 3.
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