CHICAGO and DUBLIN and
TREVOSE, Pa., May 24, 2021 /PRNewswire/ -- Xeris
Pharmaceuticals, Inc. (Nasdaq: XERS), a pharmaceutical company
leveraging its novel formulation technology platforms to develop
and commercialize ready-to-use injectable drug formulations, and
Strongbridge Biopharma plc (Nasdaq: SBBP), a global
commercial-stage biopharmaceutical company focused on the
development and commercialization of therapies for rare diseases
with significant unmet needs, today announced that they have
entered into a definitive agreement under which Xeris will acquire
Strongbridge for stock and contingent value rights ("CVRs"). The
agreement, including the maximum aggregate amount payable under the
CVRs, values Strongbridge at approximately $267 million based on the closing price of Xeris
Shares of $3.47 on May 21, 2021 and Strongbridge's fully diluted
share capital. The transaction, which has been unanimously approved
by the boards of directors of both companies, with the exception of
Jeffrey W. Sherman, M.D., a director
in common to both companies, who abstained from the voting, is
expected to close early in the fourth quarter of 2021, subject to
the satisfaction of closing conditions. Upon close of the
transaction, the businesses of Xeris and Strongbridge will be
combined under a new entity to be called Xeris Biopharma Holdings,
Inc. ("Xeris Biopharma Holdings").
Under the terms of the agreement, at closing, Strongbridge
Shareholders will receive a fixed exchange ratio of 0.7840 Xeris
Biopharma Holdings Shares for each Strongbridge Share they own.
Based on the closing price of Xeris Shares on May 21, 2021, this represents approximately
$2.72 per Strongbridge Share and a
12.9% premium to the closing price of Strongbridge Shares on
May 21, 2021. Strongbridge
Shareholders will also receive 1 non-tradeable CVR for each
Strongbridge Share they own, worth up to an additional $1.00 payable in cash or Xeris Biopharma Holdings
Shares (at Xeris Biopharma Holdings' election) upon achievement of
the following triggering events: (i) the listing of at least one
issued patent for KEVEYIS® in the U.S. Food & Drug
Administration's Orange Book by the end of 2023 or at least
$40 million in KEVEYIS® annual net
sales in 2023 ($0.25 per Strongbridge
Share), (ii) achievement of at least $40
million in RECORLEV® annual net sales in 2023 ($0.25 per Strongbridge Share), and (iii)
achievement of at least $80 million
in RECORLEV® annual net sales in 2024 ($0.50 per Strongbridge Share). The minimum
payment on the CVR is zero and the maximum payment is $1.00 in cash or Xeris Biopharma Holdings Shares
at Xeris Biopharma Holdings' election.
Upon close of the transaction, current Xeris Shareholders are
expected to own approximately 60% of the combined company, while
current Strongbridge Shareholders are expected to own approximately
40%.
"This is a very compelling transaction that will create a
scalable and diversified biopharmaceutical company increasingly
oriented toward more specialty and rare disease products,
positioning us for long-term product development and commercial
success," said Paul R. Edick,
Chairman and Chief Executive Officer of Xeris. "Strongbridge's
attractive rare disease portfolio and capabilities are highly
complementary with Xeris. Building on the continuing prescription
growth of Gvoke® with an enhanced and diversified growth profile,
expanded and scalable salesforce, and expected cost-synergies, the
combined company will be well positioned to deliver compelling
long-term value to shareholders. We look forward to welcoming the
Strongbridge team to Xeris and leveraging our differentiated
portfolios and technologies to help the patients we serve improve
their quality of life."
"We are excited to combine with Xeris to drive the next phase of
our growth," said John H. Johnson,
Chief Executive Officer of Strongbridge. "Strongbridge has made
significant progress advancing its portfolio of therapies for rare
endocrine and rare neuromuscular diseases with focus, commitment
and passion for the patients and physicians that we serve. This
includes delivering strong revenue growth for KEVEYIS®
(dichlorphenamide), our first commercial, rare neuromuscular
product, and the successful development of RECORLEV®
(levoketoconazole), which is under review for approval by the FDA
with expected commercialization in the first quarter of 2022
pending FDA approval. Through this combination with Xeris, we will
gain additional scale and financial resources to better meet the
unmet needs of those we serve. Our combined pipeline, drug
development talent and commercial infrastructure will enable us to
accelerate product launches and drive further growth. We look
forward to working closely with the Xeris team to unlock the
potential value of our combined assets, while providing our
shareholders with the opportunity to participate in the success of
the combined company."
Strategic Rationale and Financial Benefits of the
Transaction
The combination of Xeris and Strongbridge is expected to deliver
compelling strategic and financial benefits including:
- Diversified and Increased Revenue Growth. The combined
company is expected to have a stronger revenue base with two
rapidly growing commercial assets in Gvoke® and
KEVEYIS®, and a near-term product launch in
RECORLEV®. Gvoke® sells in a multi-billion
dollar addressable market, as will RECORLEV®, if
approved. With approval of RECORLEV® by the FDA, Xeris'
experienced, endocrinology-focused commercial infrastructure is
expected to enable a rapid product launch for RECORLEV® into the
endocrinology community. With Gvoke®, KEVEYIS® and RECORLEV®, the
combined company will boast multiple, highly differentiated,
growing, commercial assets that could have significant combined
revenue potential, supported by a larger and more efficient
commercial organization.
- Significant Potential Synergies.1 The
combined company is expected to generate approximately $50 million in pre-tax synergies by the end of
2022 resulting from immediate savings, including redundant general,
administrative and other public company costs, and from the
avoidance of future costs, most notably within the commercial and
medical affairs functions. Shareholders of the combined company are
expected to benefit from significant cost avoidance and the
potential for more rapid and achievable near-term growth by
utilizing Xeris' existing commercial infrastructure to launch
RECORLEV® soon after product approval. Xeris' management and the
Independent Xeris Directors are committed to retaining and
incentivizing the most talented individuals in their respective
functions between the two companies to ensure continuity and
ongoing success.
- Specialized Commercial Platform. The combined company
will have a robust rare disease and endocrinology-focused
commercial infrastructure, primed to bring the benefits of the
company's products to a wider range of patients with unmet needs.
At closing, the organization will have approximately 110 field
sales representatives, as well as 50 inside sales and support
employees, and a fully operational patient and provider support
team, enabling a rapid potential product launch for RECORLEV® in
the first quarter of 2022, as well as enhanced sales across the
entire portfolio.
- Expanded Development Pipeline. In addition to RECORLEV®,
the combined company will have a robust pipeline of development
programs to extend the current marketed products into important new
indications and uses, and bring new products forward using its
formulation technology platforms, supporting long-term product
development and commercial success.
- Strengthened Strategic Profile. This transaction will
enable the combined company to have a scalable infrastructure for
continued development of specialist oriented and rare disease
products from its proprietary XeriSol™ and XeriJect™ formulation
technologies, as well as consolidation of commercial and late
development-stage products and companies focused on endocrinology
and rare diseases.
- Improved Access to Capital Markets. With enhanced scale,
multiple revenue generating commercial assets and a high potential
value near-term development pipeline, the combined company is
expected to have a more attractive profile to investors and to
benefit from greater access to the debt and equity markets at a
lower cost of capital.
Additional Information
Upon close of the transaction, the businesses of Xeris and
Strongbridge will be combined under Xeris Biopharma Holdings, which
will be incorporated in Delaware
and will continue to have its principal executive offices in
Chicago, Il. On close, Xeris
shareholders will exchange each Xeris Share they own for 1 Xeris
Biopharma Holdings Share.
Xeris Chairman and CEO, Paul
Edick will act as Chairman and Chief Executive Officer of
Xeris Biopharma Holdings. The Xeris Biopharma Holdings board will
comprise the other existing Xeris Directors, together with
John Johnson and Garheng Kong, M.D.,
PhD, MBA who will join the combined company's board as new
independent directors. A director in common to both companies,
Jeffrey W. Sherman, M.D., will
continue to serve on the Xeris Biopharma Holdings board following
the transaction.
Xeris Biopharma Holdings Shares are expected to trade on the
Nasdaq Global Select Market ("Nasdaq") under the ticker XERS.
The transaction is expected to close early in the fourth quarter
of 2021, subject to the Conditions set out in Appendix III of this
announcement, including approval by Xeris Shareholders and
Strongbridge Shareholders.
In addition, certain Strongbridge Directors, executive officers,
CAM Capital and HealthCap VI, L.P., representing, in aggregate,
approximately 17% of Strongbridge's outstanding ordinary shares,
have entered into irrevocable undertakings to vote in favor of the
transaction.
SVB Leerink LLC is acting as financial advisor to Xeris, and
Goodwin Procter LLP and A&L Goodbody LLP are serving as legal
counsel. MTS Health Partners, LP is acting as financial advisor to
Strongbridge, and Skadden, Arps, Slate, Meagher & Flom, LLP and
Arthur Cox LLP are serving as legal counsel.
Conference Call Details
Xeris and Strongbridge will host a conference call today at
8:30 a.m. Eastern Time to discuss the
transaction. The conference call can be accessed by dialing (833)
979-2872 (U.S. / Canada) or (236)
714-2975 (International) and giving the passcode 6359699.
A live webcast of the conference call and associated
presentation materials will be available on the investor relations
sections of Xeris' and Strongbridge's websites at
https://xerispharma.com/investors and
https://investors.strongbridgebio.com, and a joint transaction
website at www.XerisStrongbridge.com.
About Xeris Pharmaceuticals, Inc.
Xeris (Nasdaq: XERS) is a pharmaceutical company delivering
innovative solutions to simplify the experience of administering
important therapies that people rely on every day around the
world.
With a novel technology platform that enables ready-to-use,
room-temperature stable formulations of injectable and infusible
therapies, the company is advancing a portfolio of solutions in
various therapeutic categories, including its first commercial
product, Gvoke® in the U.S.. Its proprietary XeriSol™ and XeriJect™
formulation technologies have the potential to offer distinct
advantages over conventional product formulations, including
eliminating the need for reconstitution, enabling long-term,
room-temperature stability, significantly reducing injection
volume, and eliminating the requirement for intravenous (IV)
infusion. With Xeris' technology, new product formulations are
designed to be easier to use by patients, caregivers, and health
practitioners and help reduce costs for payers and the healthcare
system.
Xeris is headquartered in Chicago,
Il. For more information, visit www.xerispharma.com, or
follow us on Twitter, LinkedIn or Instagram.
About Xeris Biopharma Holdings, Inc.
Xeris Biopharma Holdings is a corporation incorporated in
Delaware solely for the purpose of
effecting the Acquisition. To date, Xeris Biopharma Holdings has
not conducted any activities other than those incidental to its
formation and the execution of the Transaction Agreement.
At completion, under the Transaction Agreement, Xeris Biopharma
Holdings will acquire, pursuant to a "scheme of arrangement" under
Irish law, all of the outstanding Strongbridge Shares, and in
exchange, Strongbridge Shareholders will receive 0.7840 Xeris
Biopharma Holdings Shares and one (1) CVR for each Strongbridge
Share they currently hold.
Immediately after and conditioned on the consummation of the
Acquisition, Wells MergerSub will merge with and into Xeris, as a
result of which the separate corporate existence of Wells MergerSub
will cease and Xeris will continue as the surviving corporation and
a wholly owned subsidiary of Xeris Biopharma Holdings. At the
effective time of the Merger, all existing Xeris Shares will be
cancelled and will automatically be converted into the right to
receive Xeris Biopharma Holdings Shares on a one-for-one basis.
At and as of the Effective Date, it is expected that Xeris
Biopharma Holdings will be a publicly traded company listed on the
Nasdaq.
About Strongbridge Biopharma plc
Strongbridge (Nasdaq: SBBP) is a global commercial-stage
biopharmaceutical company focused on the development and
commercialization of therapies for rare diseases with significant
unmet needs. Strongbridge's rare endocrine franchise includes
RECORLEV® (levoketoconazole), an adrenal steroidogenesis inhibitor
with a New Drug Application that is currently under review by the
FDA for the treatment of endogenous Cushing's syndrome, and
veldoreotide extended release, a pre-clinical next-generation
somatostatin analog being investigated for the treatment of
acromegaly and potential additional applications in other
conditions amenable to somatostatin receptor activation. Both
RECORLEV and veldoreotide have received orphan drug designation
from the FDA and the European Medicines Agency. The company's rare
neuromuscular franchise includes KEVEYIS® (dichlorphenamide), the
first and only FDA-approved treatment for hyperkalemic,
hypokalemic, and related variants of primary periodic paralysis.
KEVEYIS has orphan drug exclusivity in the United States.
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There are various
material assumptions underlying the synergy (including cost
reduction and cost avoidance) estimates which may result in the
synergies being materially greater or less than estimated. The
estimate of synergies should therefore be read in conjunction with
the key assumptions underlying the estimates set out in Appendix I
of this announcement. The estimate of synergies set out in this
announcement has been reported on for the purposes of Rule
19.3(b)(ii) of the Irish Takeover Rules by (i) KPMG and (ii) SVB
Leerink LLC. Copies of their respective reports are included in
Appendix IV and Appendix V to this announcement. The synergies
exclude any potential revenue synergies. None of the synergies or
other cost reduction or avoidance statements, should be construed
as a profit forecast or interpreted to mean that Xeris Biopharma
Holdings' profits or earnings in the first full year following the
Acquisition, or in any subsequent period, would necessarily match
or be greater than or be less than those of Xeris and/or
Strongbridge for the relevant preceding financial period or any
other period. Each of KPMG and SVB Leerink LLC has given and not
withdrawn its consent to the issue of this announcement with the
inclusion of its report.
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Contacts
Xeris Pharmaceuticals
Allison Wey
Senior Vice President, Investor Relations and Corporate
Communications
awey@xerispharma.com
+1 312-736-1237
Strongbridge Biopharma
Elixir Health Public Relations
Lindsay Rocco
+1 862-596-1304
lrocco@elixirhealthpr.com
Joele Frank, Wilkinson Brimmer
Katcher
Andy Brimmer
+1 212-355-4449
No Offer or Solicitation
This announcement is for information purposes only and is not
intended to and does not constitute an offer to sell or the
solicitation of an offer to subscribe for or buy or an invitation
to purchase or subscribe for any securities or the solicitation of
any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise, nor shall there be any sale, issuance or
transfer of securities in any jurisdiction in contravention of
applicable law. In particular, this announcement is not an offer of
securities for sale into the United
States. No offer of securities shall be made in the United States absent registration under
the Securities Act or pursuant to an exemption from, or in a
transaction not subject to, such registration requirements. The
Acquisition will be made solely by means of the Scheme Document
(or, if applicable, the Takeover Offer Document), which will
contain the full terms and conditions of the Acquisition, including
details of how Strongbridge Shareholders may vote in respect of the
Acquisition.
Important Additional Information will be Filed with the
SEC
Xeris, Xeris Biopharma Holdings and Strongbridge will prepare
and Xeris Biopharma Holdings will file with the SEC a Registration
Statement on Form S-4 that will include a joint proxy statement of
Strongbridge and Xeris and that also will constitute a prospectus
with respect to the Xeris Biopharma Holdings Shares to be issued
pursuant to the Acquisition (the Joint Proxy Statement). The Joint
Proxy Statement will also contain the Scheme Document and further
information relating to the implementation of the Acquisition, the
full terms and conditions of the Scheme, notices of the Xeris
Shareholder Meeting and the Strongbridge Meetings and information
on the Xeris Biopharma Holdings Shares. Xeris and Strongbridge may
also file other documents with the SEC regarding the Acquisition.
This document is not a substitute for the Joint Proxy Statement or
any other document which Xeris, Xeris Biopharma Holdings or
Strongbridge may file with the SEC.
The Joint Proxy Statement, if and when filed, as well as Xeris'
and Strongbridge's other public filings with the SEC, may be
obtained without charge at the SEC's website at www.sec.gov and, in
the case of Xeris' filings, at Xeris' website at
www.Xerispharma.com, and in the case of Strongbridge's filings, at
Strongbridge's website at www.Strongbridgebio.com.
INVESTORS, XERIS SHAREHOLDERS AND STRONGBRIDGE SHAREHOLDERS ARE
URGED TO READ THE JOINT PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS
ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN
THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE ACQUISITION AND RELATED MATTERS.
Any vote in respect of resolutions to be proposed at the
Strongbridge Meetings to approve the Acquisition, the Scheme or
related matters, or other responses in relation to the Acquisition,
should be made only on the basis of the information contained in
the Joint Proxy Statement (including the Scheme Document).
Similarly, any vote in respect of resolutions to be proposed at the
Xeris Shareholder Meeting should be made only on the basis of the
information contained in the Joint Proxy Statement.
Participants in the Solicitation
Xeris, Xeris Biopharma Holdings, Strongbridge and their
respective directors and executive officers and employees may be
deemed to be participants in the solicitation of proxies from their
respective shareholders in connection with the Acquisition.
Information regarding the persons who may, under the rules of the
SEC, be deemed to be participants in the solicitation of
shareholders in connection with the Acquisition, including a
description of their direct or indirect interests, which may be
different from those of Xeris Shareholders or Strongbridge
Shareholders generally, by security holdings or otherwise, will be
set forth in the Joint Proxy Statement (which will contain the
Scheme Document) and any other relevant documents that are filed or
will be filed with the SEC relating to the Acquisition. Information
regarding Xeris' directors and executive officers is contained in
Xeris' Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on
March 9, 2021, and its Proxy
Statement on Schedule 14A, dated and filed with the SEC on
April 29, 2021. Information regarding
Strongbridge's directors and executive officers is contained
in Strongbridge's Annual Report on Form 10-K for the year ended
December 31, 2020, filed with the SEC
on March 3, 2021, and its Proxy
Statement on Schedule 14A, dated and filed with the SEC on
April 14, 2021. You may obtain free
copies of these documents using the sources indicated above.
Forward-Looking Statements
This announcement contains certain forward-looking statements
with respect to a proposed transaction involving Xeris and
Strongbridge and Xeris', Strongbridge's and/or the combined group's
estimated or anticipated future business, performance and results
of operations and financial condition, including estimates,
forecasts, targets and plans for Xeris and Strongbridge and,
following the acquisition, if completed, the combined group. The
words "believe," "expect," "anticipate," "project" and similar
expressions, among others, generally identify forward-looking
statements. These forward-looking statements are subject to risks
and uncertainties that may cause actual results to differ
materially from those indicated in the forward-looking statements.
Such risks and uncertainties include, but are not limited to, the
possibility that a possible acquisition will not be pursued,
failure to obtain necessary shareholder or regulatory approvals or
required financing or to satisfy any of the other conditions to the
possible acquisition, the reaction of Xeris' and Strongbridge's
shareholders to the proposed transaction, adverse effects on the
market price of Xeris Shares or Strongbridge Shares and on Xeris'
or Strongbridge's operating results because of a failure to
complete the possible acquisition, failure to realize the expected
benefits of the possible acquisition, failure to promptly and
effectively integrate Strongbridge's businesses, negative effects
relating to the announcement of the possible acquisition or any
further announcements relating to the possible acquisition or the
consummation of the possible acquisition on the market price of
Xeris Shares or Strongbridge Shares, significant transaction costs
and/or unknown or inestimable liabilities, the risk that any
potential payment of proceeds pursuant to the CVR Agreement may not
be distributed at all or result in any value to Strongbridge
Shareholders, potential litigation associated with the possible
acquisition, general economic and business conditions that affect
the combined companies following the consummation of the possible
acquisition, the impact of the COVID-19 pandemic on Xeris' or
Strongbridge's businesses or the combined businesses following the
consummation of the transaction, changes in global, political,
economic, business, competitive, market and regulatory forces,
future exchange and interest rates, changes in tax laws,
regulations, rates and policies, future business acquisitions or
disposals and competitive developments. These forward-looking
statements are based on numerous assumptions and assessments made
in light of Xeris' or, as the case may be, Strongbridge's
experience and perception of historical trends, current conditions,
business strategies, operating environment, future developments and
other factors it believes appropriate. By their nature,
forward-looking statements involve known and unknown risks and
uncertainties because they relate to events and depend on
circumstances that will occur in the future. The factors described
in the context of such forward-looking statements in this
announcement could cause Xeris' plans with respect to Xeris or
Strongbridge, Strongbridge's or Xeris' actual results, performance
or achievements, industry results and developments to differ
materially from those expressed in or implied by such
forward-looking statements. Although it is believed that the
expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will
prove to have been correct and persons reading this announcement
are therefore cautioned not to place undue reliance on these
forward-looking statements which speak only as at the date of this
announcement. Additional information about economic, competitive,
governmental, technological and other factors that may affect Xeris
is set forth in Item 1A, "Risk Factors," in Xeris' 2020 Annual
Report on Form 10-K, which has been filed with the SEC, the
contents of which are not incorporated by reference into, nor do
they form part of, this announcement. Additional information about
economic, competitive, governmental, technological and other
factors that may affect Strongbridge is set forth in Item 1A, "Risk
Factors," in Strongbridge's 2020 Annual Report on Form 10-K, which
has been filed with the SEC, the contents of which are not
incorporated by reference into, nor do they form part of, this
announcement.
Any forward-looking statements in this announcement are based
upon information available to Xeris, Strongbridge and/or their
respective boards of directors, as the case may be, as of the date
of this announcement and, while believed to be true when made, may
ultimately prove to be incorrect. Subject to any obligations under
applicable law, none of Xeris, Strongbridge or any member of their
respective boards of directors undertakes any obligation to update
any forward-looking statement whether as a result of new
information, future developments or otherwise, or to conform any
forward-looking statement to actual results, future events, or to
changes in expectations. All subsequent written and oral
forward-looking statements attributable to Xeris, Strongbridge or
their respective boards of directors or any person acting on behalf
of any of them are expressly qualified in their entirety by this
paragraph.
Statement Required by the Irish Takeover Rules
The Xeris Directors and the Xeris Biopharma Holdings Directors
accept responsibility for the information contained in this
announcement other than that relating to Strongbridge, the
Strongbridge Group, and the Strongbridge Directors, and members of
their immediate families, related trusts and persons connected with
them, and for the statements made by Strongbridge in respect of
Xeris and Xeris Biopharma Holdings and the recommendation and
related opinions of the Independent Strongbridge Directors. The
Independent Xeris Directors accept responsibility for the
recommendation and the related opinions of the Independent Xeris
Directors contained in this announcement. To the best of the
knowledge and belief of the Xeris Directors, the Xeris Biopharma
Holdings Directors and the Independent Xeris Directors (who, in
each case, have taken all reasonable care to ensure such is the
case), the information contained in this announcement for which
they respectively accept responsibility is in accordance with the
facts and does not omit anything likely to affect the import of
such information.
The Strongbridge Directors accept responsibility for the
information contained in this announcement relating to
Strongbridge, the Strongbridge Group and the Strongbridge Directors
and members of their immediate families, related trusts and persons
connected with them, except for the statements made by Xeris in
respect of Strongbridge and the recommendation and related opinions
of the Independent Strongbridge Directors contained in this
announcement. The Independent Strongbridge Directors accept
responsibility for the recommendation and the related opinions of
the Independent Strongbridge Directors contained in this
announcement. To the best of the knowledge and belief of the
Strongbridge Directors and the Independent Strongbridge Directors
(who, in each case, have taken all reasonable care to ensure such
is the case), the information contained in this announcement for
which they respectively accept responsibility is in accordance with
the facts and does not omit anything likely to affect the import of
such information.
SVB Leerink LLC is acting as Xeris' financial advisor in
connection with the Acquisition. In connection with the
Acquisition, SVB Leerink LLC and its directors, officers,
employees, affiliates, and agents will not regard any other person
as its client, nor will it be responsible to anyone other than
Xeris for providing the protections afforded to clients of SVB
Leerink LLC or for giving advice in connection with the Acquisition
or any matter referred to herein.
MTS Health Partners, LP is acting as financial adviser to
Strongbridge in connection with the Acquisition. In connection with
the Acquisition, MTS Health Partners, LP and its directors,
officers, employees, affiliates, and agents will not regard any
other person as its client, nor will it be responsible to anyone
other than Strongbridge for providing the protections afforded to
clients of MTS Health Partners, LP or for giving advice in
connection with the Acquisition or any matter referred to
herein.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the Irish Takeover Rules, if
any person is, or becomes, 'interested' (directly or indirectly) in
1% or more of any class of 'relevant securities' of Strongbridge or
Xeris, all 'dealings' in any 'relevant securities' of Strongbridge
or Xeris (including by means of an option in respect of, or a
derivative referenced to, any such 'relevant securities') must be
publicly disclosed by not later than 3:30
pm (New York time) on the
'business' day following the date of the relevant transaction. This
requirement will continue until the date on which the Scheme
becomes effective or on which the 'offer period' otherwise ends. If
two or more persons cooperate on the basis of any agreement, either
express or tacit, either oral or written, to acquire an 'interest'
in 'relevant securities' of Strongbridge or Xeris, they will be
deemed to be a single person for the purpose of Rule 8.3 of the
Irish Takeover Rules.
Under the provisions of Rule 8.1 of the Irish Takeover Rules,
all 'dealings' in 'relevant securities' of Strongbridge by Xeris or
'relevant securities' of Xeris by Strongbridge, or by any party
acting in concert with either of them, must also be disclosed by no
later than 12 noon (New York time)
on the 'business' day following the date of the relevant
transaction.
A disclosure table, giving details of the companies in whose
'relevant securities' 'dealings' should be disclosed, can be found
on the Panel's website at www.irishtakeoverpanel.ie.
'Interests in securities' arise, in summary, when a person has
long economic exposure, whether conditional or absolute, to changes
in the price of securities. In particular, a person will be treated
as having an 'interest' by virtue of the ownership or control of
securities, or by virtue of any option in respect of, or derivative
referenced to, securities.
Terms in single quotation marks are defined in the Irish
Takeover Rules, which can also be found on the Panel's website. If
you are in any doubt as to whether or not you are required to
disclose a dealing under Rule 8, please consult the Panel's website
at www.irishtakeoverpanel.ie or contact the Panel on telephone
number +353 1 678 9020.
No Profit Forecast / Asset Valuations
No statement in this announcement is intended to constitute a
profit forecast for any period, nor should any statements be
interpreted to mean that earnings or earnings per share will
necessarily be greater or lesser than those for the relevant
preceding financial periods for Xeris, Xeris Biopharma Holdings or
Strongbridge as appropriate. No statement in this announcement
constitutes an asset valuation.
Publication on Website
Pursuant to Rule 2.6(c) of the Irish Takeover Rules, this
announcement will be available to Xeris employees on Xeris' website
www.Xerispharma.com and Strongbridge employees on Strongbridge's
website www.Strongbridgebio.com. Neither the content of any such
website nor the content of any other website accessible from
hyperlinks on such website is incorporated into, or forms part of,
this announcement.
Right to Switch to a Takeover Offer
Xeris reserves the right, subject to the terms of the
Transaction Agreement, to elect to implement the Acquisition by way
of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel's
consent. In such event, the Acquisition will be implemented on
terms at least as favorable, so far as applicable, as those which
would apply to the Scheme, subject to appropriate amendments
(including an acceptance condition set at 80% of the shares to
which such offer relates).
If Xeris exercises its right to implement the Acquisition by way
of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel's
consent, such Takeover Offer would be made in compliance with
applicable U.S. Law and regulations, including the registration
requirements of the Securities Act and the tender offer rules under
the Exchange Act and any applicable exemptions provided
thereunder.
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, any figures shown
for the same category presented in different tables may vary
slightly and figures shown as totals in certain tables may not be
an arithmetic aggregation of the figures that precede them.
General
This summary should be read in conjunction with, and is subject
to, the full text of this announcement (including its
Appendices).
The Acquisition is subject to, inter alia, the satisfaction or
waiver (as applicable) of the Conditions set out in Appendix III to
this announcement and to the full terms and conditions which will
be set out in the Joint Proxy Statement (which will contain the
Scheme Document).
Appendix I to this announcement contains further details of the
sources of information and bases of calculations set out in this
announcement; Appendix II to this announcement contains definitions
of certain expressions used in this announcement; Appendix III to
this announcement contains the Conditions of the Acquisition and
the Scheme; Appendix IV to this announcement sets out the report
from KPMG in respect of certain merger benefit statements made in
this announcement; Appendix V to this announcement contains the
report from SVB Leerink LLC in respect of certain merger benefit
statements made in this announcement; Appendix VI to this
announcement sets out the Transaction Agreement; and Appendix VII
to this announcement sets out the form of the CVR Agreement.
The release, publication or distribution of this announcement in
or into certain jurisdictions may be restricted by the laws of
those jurisdictions, including any Restricted Jurisdictions.
Accordingly, copies of this announcement and all other documents
relating to the Acquisition are not being, and must not be,
released, published, mailed or otherwise forwarded, distributed or
sent in, into or from any such Restricted Jurisdictions. Persons
receiving such documents (including, without limitation, nominees,
trustees and custodians) should observe these restrictions. Failure
to do so may constitute a violation of the securities laws of any
such jurisdiction. To the fullest extent permitted by applicable
Law, the companies involved in the Acquisition disclaim any
responsibility or liability for the violations of any such
restrictions by any person.
Any response in relation to the Acquisition should be made only
on the basis of the information contained in the Joint Proxy
Statement (including the Scheme Document) or any document by which
the Acquisition and the Scheme are made. Strongbridge Shareholders
are advised to read carefully the formal documentation in relation
to the proposed acquisition once the Joint Proxy Statement
(including the Scheme Document) has been despatched.
This announcement has been prepared for the purpose of complying
with the laws of Ireland and the
Irish Takeover Rules and the information disclosed may not be the
same as that which would have been disclosed if this announcement
had been prepared in accordance with the laws of jurisdictions
outside of Ireland.
This announcement does not constitute a prospectus or prospectus
equivalent document.
If you are in any doubt about the contents of this announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your appropriately
authorized independent financial adviser.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR
IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION
THIS ANNOUNCEMENT IS BEING MADE PURSUANT TO RULE 2.5 OF
THE IRISH TAKEOVER RULES
FOR IMMEDIATE RELEASE
May 24, 2021
RECOMMENDED OFFER
XERIS PHARMACEUTICALS, INC. TO ACQUIRE
STRONGBRIDGE BIOPHARMA PLC
FOR UP TO $267 MILLION IN STOCK AND
CVRS
BY MEANS OF A SCHEME OF ARRANGEMENT UNDER
CHAPTER 1 OF PART 9 OF THE COMPANIES ACT 2014
1. Introduction
Xeris Pharmaceuticals, Inc. (Nasdaq: XERS), a pharmaceutical
company leveraging its novel formulation technology platforms to
develop and commercialize ready-to-use injectable drug
formulations, and Strongbridge Biopharma plc (Nasdaq: SBBP), a
global commercial-stage biopharmaceutical company focused on the
development and commercialization of therapies for rare diseases
with significant unmet needs, today announced that they have
entered into a definitive agreement under which Xeris will acquire
Strongbridge for stock and contingent value rights ("CVRs").
The Transaction has been unanimously approved by the Independent
Xeris Directors and the Independent Strongbridge Directors and is
expected to close early in the fourth quarter of 2021.
It is intended that the Acquisition will be effected by means of
a scheme of arrangement under Chapter 1 of Part 9 of the Act. The
Acquisition will be on the terms and subject to the conditions set
out below, and the implementation of the Acquisition and the Scheme
will be subject to the Conditions set out in Appendix III of this
announcement, including approval by Strongbridge Shareholders and
Xeris Shareholders, which will also be set out in the Joint Proxy
Statement (which will also include the Scheme Document).
Under the terms of the Transaction Agreement, at the close of
the Transaction, each of Xeris and Strongbridge will become a
subsidiary of a new holding company incorporated in Delaware that will be named Xeris Biopharma
Holdings, Inc.
2. Transaction Details
Under the terms of the Transaction Agreement, which has been
unanimously approved by the Independent Xeris Directors and the
Independent Strongbridge Directors, at completion, Strongbridge
Shareholders will receive:
- 0.7840 Xeris Biopharma Holdings Shares; and
- 1 non-tradeable CVR, representing a contractual right to
receive future conditional cash payments worth up to a maximum
aggregate amount of $1.00 per
Strongbridge Share, settleable in cash, additional Xeris Biopharma
Holdings Shares or a combination of cash and additional Xeris
Biopharma Holdings Shares, at Xeris Biopharma Holdings' sole
election, upon the achievement of certain Milestones relating to
Strongbridge assets, KEVEYIS® and RECORLEV®,
for each Strongbridge Share that
they hold.
The Transaction, including the maximum aggregate amount payable
under the CVRs, values Strongbridge at approximately $267 million, based on the closing price of Xeris
Shares of $3.47 on May 21, 2021, the last trading prior to the date
of this announcement and Strongbridge's fully diluted share
capital.
The Share Consideration represents approximately $2.72 per Strongbridge Share and a premium of
approximately 12.9 % based on the closing price of Strongbridge
Shares as of May 21, 2021, the last
trading prior to the date of this announcement.
Xeris Shareholders will exchange each Xeris Share they own for 1
Xeris Biopharma Holdings Share.
Upon completion of the transaction, which is expected early in
the fourth quarter of 2021, Xeris Shareholders are expected to own
approximately 60% of Xeris Biopharma Holdings and Strongbridge
Shareholders are expected to own approximately 40% of Xeris
Biopharma Holdings. Xeris Biopharma Holdings' Shares are expected
to trade on the Nasdaq.
3. CVRs
The CVRs will be issued by Xeris Biopharma Holdings in
accordance with and subject to the terms of the CVR Agreement. The
CVRs are intended to afford Strongbridge Shareholders an
opportunity to benefit from the potential success of KEVEYIS® and
RECORLEV® if certain Milestones are met in accordance with the
terms of the CVR Agreement.
Pursuant to the terms of the CVR Agreement, each CVR will
represent the contractual right to receive up to an aggregate of
$1.00, settleable in cash, additional
Xeris Biopharma Holdings Shares or a combination of cash and Xeris
Biopharma Holdings Shares, at Xeris Biopharma Holdings' sole
election, with settlement conditioned upon the achievement of
certain Milestones as follows:
(a) the earlier of the first
listing of any patent in the U.S. Food & Drug Administration's
Orange Book for KEVEYIS® by the end of 2023 or the first
achievement of at least $40 million
in net sales of KEVEYIS® in 2023 ($0.25 per CVR),
(b) the first achievement of
at least $40 million in net sales of
RECORLEV® in 2023 ($0.25 per CVR),
and
(c) the first achievement of
at least $80 million in net sales of
RECORLEV® in 2024 ($0.50 per
CVR).
The CVRs are complex instruments and a number of factors will
determine whether any amount will actually be paid to CVR holders
in accordance with the terms of the CVRs. If none of the Milestones
are achieved by the relevant date, then the CVRs will have no
value. The minimum payment under each CVR is zero and the maximum
payment under each CVR is $1.00,
settleable in cash, additional Xeris Biopharma Holdings Shares or a
combination of cash and Xeris Biopharma Holdings Shares, at Xeris
Biopharma Holdings' sole election. The CVRs are not cash confirmed
and Xeris has not guaranteed the obligations of Xeris Biopharma
Holdings pursuant to the CVR Agreement. Further details in respect
of the CVRs will be contained in the Joint Proxy Statement (which
will contain the Scheme Document).
The maximum payment upon any Milestone, or over the entire
period of the CVR Agreement, could be zero. There will be no
interest conferred by a CVR in the economic activities of the
Strongbridge Group generally or the Xeris Group generally.
No cash confirmation exercise has been undertaken by Xeris to
verify that resources will be available to Xeris Biopharma Holdings
sufficient to satisfy any payments that may become due in respect
of the CVRs. SVB Leerink LLC, as financial adviser to Xeris, has
not been required to confirm, and has not confirmed, that resources
are available to Xeris Biopharma Holdings sufficient to satisfy any
payments that may become due in respect of the CVRs and CVR holders
will be at risk if, for any reason, such resources are not
available to Xeris Biopharma Holdings. Xeris, Xeris Biopharma
Holdings and Strongbridge do not expect any of the Milestones to
occur prior to completion of the Acquisition.
The CVRs may not be sold, assigned, transferred, pledged,
encumbered or in any other manner transferred or disposed of, in
whole or in part, other than through a "Permitted Transfer" in
accordance with the terms of the CVR Agreement. Under the terms of
the CVR Agreement, a "Permitted Transfer" means a transfer of CVRs
(a) upon the death of a holder of a CVR by will or intestacy; (b)
made by instrument to an inter vivos or testamentary trust
in which the CVRs are to be passed to beneficiaries upon the death
of the trustee; (c) made pursuant to a court order; (d) made by
operation of Law (including by consolidation or merger) or without
consideration in connection with the dissolution, liquidation or
termination of any corporation, limited liability company,
partnership or other entity; (e) in the case of CVRs held in
book-entry or other similar nominee form, from a nominee to a
beneficial owner and, if applicable, through an intermediary, to
the extent allowable by The Depository Trust Company (DTC); or (f)
to Xeris Biopharma Holdings, as provided under the terms of the CVR
Agreement.
No application will be made for the CVRs to be listed or dealt
on any exchange, however if Xeris elects to pay the applicable
Milestone Payment in Xeris Biopharma Holdings Shares or a
combination of Xeris Biopharma Holdings Shares and cash, Xeris
Biopharma Holdings shall use commercially reasonable efforts to
cause the shares of Xeris Biopharma Holdings to be issued in
connection with such payment to be listed on the Nasdaq, subject to
official notice of issuance, prior to the relevant Milestone
Payment Date. The CVRs will not be represented by any certificate
or other instrument. The holders of CVRs will not have any voting
or dividend rights and the CVRs will not represent any equity or
ownership interest in Xeris and / or Xeris Biopharma Holdings. No
interest is payable in respect of the CVRs so long as required
payments are made in a timely manner.
The CVRs will be governed by and construed in accordance with
the laws of the State of
Delaware.
If the Laws of any relevant jurisdiction make it illegal for a
Strongbridge Shareholder to hold CVRs or would require any
qualification of the CVRs under any applicable Law or regulations,
such Strongbridge Shareholder may not be able to hold the CVRs or
receive the amounts which may be payable thereon.
Further details of the CVRs will be contained in the Joint Proxy
Statement (which will also include the Scheme Document).
4. Xeris Background to and Reasons for the
Acquisition
As a part of its on-going review of Xeris' long-term strategy,
the Xeris Board regularly considers strategic opportunities that
might be available to enhance shareholder value, including
additional investments in new growth opportunities and potential
acquisitions.
Beginning in early 2021, senior management of Xeris and
Strongbridge had a series of discussions regarding the possibility
of an acquisition by Xeris of Strongbridge and the possible terms
of such a transaction. In connection with a possible transaction,
Xeris retained SVB Leerink LLC as its financial advisor and Goodwin
Procter LLP and A&L Goodbody LLP as its legal advisors.
During the period preceding the execution of definitive
documentation for the Acquisition on May 24,
2021, the parties discussed and negotiated the transaction
terms, conducted due diligence with respect to each other's
businesses and consulted with the Panel. On May 23, 2021, the Independent Xeris Directors
met, together with Xeris' senior management and financial and legal
advisors, to consider proposed terms and drafts of definitive
documentation for a proposed acquisition by Xeris of Strongbridge.
At this meeting, the Independent Xeris Directors unanimously
determined that the Transaction Agreement and the transactions
contemplated thereby, including the Acquisition, were in the best
interests of Xeris and its shareholders, and thereby authorized and
approved the Acquisition.
The Independent Xeris Directors believe that the Acquisition
will create a leading specialty pharmaceutical business,
increasingly oriented toward products to treat rare diseases. The
combined company will have multiple specialist oriented, revenue
generating and growing market products that are patent protected
well into the future. The combined company will also have a robust
pipeline of development programs to extend the current marketed
products into important new indications and uses and bring new
products forward using its formulation technology platforms. The
Independent Xeris Directors believe that the combined company will
be well-positioned for long-term product development and commercial
success.
In reaching its decision to approve the Acquisition, the
Independent Xeris Directors consulted with and received advice and
reports from Xeris' senior management and its financial and legal
advisors, and drew on its knowledge of Xeris' business, assets,
financial position, operating results, historical and current
trading prices of its securities, and the opportunities and
challenges in its businesses and the industries in which it
operates, as well as information relating to Strongbridge and the
potential opportunities available to and future business prospects
of the combined company.
After giving consideration to these and a variety of other
factors and risks, the Independent Xeris Directors unanimously
recommend that Xeris Shareholders vote to approve the Transaction
Agreement.
Jeffrey W. Sherman, M.D., has not
participated in any commercial assessments, discussions,
negotiations or approvals relating to the Acquisition and is not
participating in the Independent Xeris Directors' recommendation as
Dr. Sherman may be considered as having a conflict of interest
due to Dr. Sherman's directorship of and shareholding in
Strongbridge.
Further detail in respect of the background and reasons for the
Acquisition will be included in the Joint Proxy Statement (which
will also include the Scheme Document).
5. Strongbridge Background to and Reasons for
Recommending the Acquisition
The Strongbridge Directors have on an ongoing basis considered
the long-term strategy of Strongbridge and strategic opportunities
that might be available to enhance shareholder value, including
additional investments in new growth opportunities, potential
acquisitions and the possible sale of Strongbridge.
Beginning in early 2021, senior management of Xeris and
Strongbridge had a series of discussions regarding the possibility
of an acquisition by Xeris of Strongbridge and the possible terms
of such a transaction. In connection with a possible transaction,
Strongbridge retained MTS Health Partners, LP, as its financial
advisor and Skadden, Arps, Slate, Meagher & Flom LLP and Arthur
Cox LLP as its legal advisors.
During the period preceding the execution of definitive
documentation for the Acquisition on May 24,
2021, the parties discussed and negotiated the transaction
terms, conducted due diligence with respect to each other's
businesses and consulted with the Panel. Also during this period,
the Independent Strongbridge Directors met, together with
Strongbridge's senior management and its financial and legal
advisors, on various occasions to consider the merits of a
potential transaction with Xeris and the status of the discussions
and negotiations between the parties.
On May 21, 2021, the Independent
Strongbridge Directors met, together with Strongbridge's senior
management and financial and legal advisors, to consider proposed
terms and drafts of definitive documentation for a proposed
acquisition by Xeris of Strongbridge. At this meeting, the
Independent Strongbridge Directors unanimously determined that the
Transaction Agreement and the transactions contemplated thereby,
including the Scheme, were advisable for, fair to and in the best
interests of Strongbridge and the Strongbridge Shareholders, and
thereby approved the Acquisition and determined that the terms of
the Scheme were fair and reasonable, subject to receipt of the
final exchange ratio and fairness opinion from Strongbridge's
financial advisor, MTS Health Partners, LP. The Independent
Strongbridge Directors also delegated to a transaction committee of
their members the full power and authority to act on their behalf
to take any and all actions with respect to the Acquisition,
including to approve the final exchange ratio and to receive the
fairness opinion from MTS Securities, LLC, an affiliate of MTS
Health Partners, LP. On May 23, 2021,
the transaction committee met and approved the final exchange ratio
and received the fairness opinion.
In reaching its decision to approve the Acquisition, the
Independent Strongbridge Directors consulted with and received
advice and reports from Strongbridge's senior management and its
financial and legal advisors, and drew on its knowledge of
Strongbridge's business, assets, financial position, operating
results, historical and current trading prices of its securities,
and the opportunities and challenges in its businesses and the
industries in which it operates, as well as information relating to
Xeris and the potential opportunities available to and future
business prospects of the combined company. After giving
consideration to these and a variety of other factors and risks,
the Independent Strongbridge Directors unanimously determined to
recommend that Strongbridge Shareholders vote in favor of the
Acquisition.
Jeffrey W. Sherman, M.D., has not
participated in any commercial assessments, discussions,
negotiations or approvals relating to the Acquisition and is not
participating in the Independent Strongbridge Directors'
recommendation as Dr. Sherman may be considered as having a
conflict of interest due to Dr. Sherman's directorship of and
shareholding in Xeris.
Further detail in respect of the background and reasons for the
Acquisition will be included in the Joint Proxy Statement (which
will also include the Scheme Document).
6. Independent Strongbridge Directors
Recommendation
The Independent Strongbridge Directors, who have been advised by
MTS Securities, LLC, consider the terms of the Acquisition to be
fair and reasonable. The Board of Directors of Strongbridge has
received an opinion of MTS Securities, LLC, that, as of
May 23, 2021, the consideration to be
received by holders of Strongbridge ordinary shares in the
Acquisition is fair, from a financial point of view, to such
holders.
Accordingly, the Independent Strongbridge Directors unanimously
recommend to Strongbridge Shareholders to vote in favor of the
Acquisition and the Scheme, as the Independent Strongbridge
Directors who are Strongbridge Shareholders intend to do in respect
of their own beneficial holdings of, in aggregate, 207,759
Strongbridge Shares, which represent, in aggregate, approximately
0.3% of the existing issued share capital of Strongbridge as at
May 21, 2021 (being the last
practicable date prior to the release of this announcement).
Jeffrey W. Sherman, M.D. is not
participating in the Independent Strongbridge Directors'
recommendation of the Acquisition and related matters as Dr.
Sherman may be considered as having a conflict of interest due to
Dr. Sherman's directorship of and shareholding in Xeris.
7. Irrevocable Undertakings
Each Independent Strongbridge Director, save for Marten Steen as he does not hold any direct
interests in securities of Strongbridge, and each Strongbridge
executive officer has given an irrevocable undertaking to Xeris and
Xeris Biopharma Holdings to vote in favor of each of the
Resolutions required to implement the Acquisition (representing
less than 1% of the existing issued share capital of Strongbridge
as at May 21, 2021 (being the last
practicable date prior to the release of this announcement)).
In addition, Xeris and Xeris Biopharma Holdings have also
received irrevocable undertakings to vote in favor of each the
Resolutions from CAM Capital and HealthCap VI, L.P. in respect of
10,887,041 Strongbridge Shares, which represents approximately 16%
of the existing issued share capital of Strongbridge as at
May 21, 2021 (being the last
practicable date prior to the release of this announcement).
Irrevocable undertakings to vote in favor of each of the
Resolutions required to implement the Acquisition, therefore, have
been received by Xeris and Xeris Biopharma Holdings over, in
aggregate, 11,201,989 Strongbridge Shares, which represents
approximately 17% of the existing issued share capital of
Strongbridge as at May 21, 2021
(being the last practicable date prior to the release of this
announcement).
The irrevocable undertakings will terminate upon the occurrence
of certain events, namely the earlier to occur of the
following:
(a) the Rule 2.5
Announcement is not released on May 24,
2021 or such later date as Xeris and Strongbridge may
agree;
(b) Xeris Biopharma Holdings
publicly announces that it does not intend to make or proceed with
the Acquisition;
(c) the Acquisition lapses
or is withdrawn (which, for the avoidance of doubt, will not be
deemed to have occurred only by reason of Xeris electing to switch
from a Scheme to a Takeover Offer);
(d) the Transaction
Agreement is validly terminated in accordance with its terms;
(e) the Scheme becomes
effective;
(f) prior to the Court
Meeting, a third party announces a firm intention to make an offer
to acquire Strongbridge, provided that the terms of such offer must
provide for a consideration per Strongbridge Share that is not less
than 105% of the value of the consideration offered under the
Scheme (including for the avoidance of doubt the value of the CVR
Consideration) (in the case of the irrevocable undertakings
received from CAM Capital and Health Cap VI L.P. only); or
(g) 31 December 2021 (in the case of the irrevocable
undertaking received from Health Cap VI L.P. only).
8. The Acquisition and the Scheme
The Acquisition will be effected by means of a "scheme of
arrangement" in accordance with Chapter 1 of Part 9 of the Act
pursuant to which Xeris Biopharma Holdings will acquire all of the
outstanding shares of Strongbridge in exchange for, (i) 0.7840
Xeris Biopharma Holdings Shares, and (ii) one (1) CVR, per
Strongbridge Share. The Acquisition will be subject to the
Conditions set out in Appendix III to this announcement and to be
set forth in the scheme of arrangement described in the Scheme
Document which will be delivered to Strongbridge Shareholders as
part of the Joint Proxy Statement.
To become effective, the Scheme will require, among other
things, (i) the approval of the Scheme by a majority in number of
members of each class of Strongbridge Shareholders (including as
may be directed by the High Court pursuant to Section 450(5) of the
Act) present and voting either in person or by proxy, at the Court
Meeting (or at any adjournment or postponement of such meeting)
representing at least 75% in value of the Strongbridge Shares of
that class held by such Strongbridge Shareholders, and (ii) the
Required EGM Resolutions being duly passed by the requisite
majorities of Strongbridge Shareholders at the EGM (or any
adjournment or postponement thereof). Following the Strongbridge
Shareholder Approval being obtained and the satisfaction or (where
applicable) waiver of the other conditions to the consummation of
the Scheme, the sanction of the High Court is also required.
The Acquisition, which is unanimously recommended by the
Independent Xeris Directors and the Independent Strongbridge
Directors, is also subject to receipt of Xeris Shareholder Approval
and certain other conditions, as more particularly set out in
Appendix III of this announcement.
Assuming the necessary approvals from the Strongbridge
Shareholders and the Xeris Shareholders have been obtained and all
other conditions have been satisfied or waived (where applicable),
the Scheme will become effective upon delivery to the Irish
Registrar of Companies of a copy of the Court Order of the High
Court sanctioning the Scheme together with, if applicable, the
minute required by section 86 of the Act confirming a capital
reduction to take place in connection with the Acquisition, and
registration of the Court Order (and minute if applicable) by the
Registrar of Companies. Upon the Scheme becoming effective, the
Scheme will be binding on all Strongbridge Shareholders,
irrespective of whether or not they attended or voted at the Court
Meeting or the EGM.
The Acquisition will be conditional upon the Scheme becoming
effective. The Conditions to the Acquisition and the Scheme are set
out in full in Appendix III to this announcement. The
implementation of the Scheme is conditional, amongst other things,
upon:
- the approval by the Strongbridge Shareholders and the sanction
by the High Court of the Scheme;
- the approval by the Xeris Shareholders;
- the approval for listing on the Nasdaq (subject only to certain
standard conditions) of the Xeris Biopharma Holdings Shares;
- all applicable waiting periods under the HSR Act in connection
with the Acquisition having expired or having been terminated;
- to the extent (i) the Acquisition constitutes a concentration
within the scope of the EC Merger Regulation or otherwise is a
concentration that is subject to the EC Merger Regulation, the
European Commission having decided to allow the closing of the
Acquisition, and (ii) that all or part of the Acquisition is
referred by the European Commission to the relevant authority of
one or more member countries of the European Economic Area, such
relevant authority(ies) (in the case of a partial referral in
conjunction with a final decision of the European Commission)
having issued a final decision or decisions which satisfies (or
together satisfy) the prior clause (i) (that clause being
interpreted mutatis mutandis);
- all required Clearances of any Governmental Entity having been
obtained and remaining in full force and effect and all applicable
waiting periods having expired, lapsed or been terminated (as
appropriate), in each case in connection with the Acquisition
and/or the Merger, under the Antitrust Laws of each Specified
Jurisdiction, and no (a) Law (other than an order, writ, decree,
judgment, injunction, restraint or prohibition described in clause
(b)), (b) order, writ, decree, judgment, injunction, restraint or
prohibition by any court of competent jurisdiction, or (c) order,
writ, decree, judgment, injunction, restraint or prohibition under
any Antitrust Law of a Specified Jurisdiction by any Relevant
Authority which restrains, enjoins, makes illegal or otherwise
prohibits consummation of the Acquisition or the Merger shall have
been issued, made, enacted or entered and shall continue to be in
effect;
- the Transaction Agreement not having been terminated in
accordance with its terms;
- the Form S-4 containing the Joint Proxy Statement having become
effective under the Securities Act and not being the subject of any
stop order or proceedings initiated by the SEC seeking any stop
order.
- the accuracy of each of the parties' representations and
warranties, except generally as would not have a material adverse
effect on such party; and
- the performance by each party, in all material respects, with
all of its covenants and agreements under the Transaction
Agreement.
The Scheme Document, containing further information relating to
the implementation of the Acquisition, the full terms and
Conditions of the Scheme, and the notices of the Court Meeting, to
be convened by resolution of the Strongbridge Directors or
direction of the High Court, and the separate EGM required to
approve the Scheme and related resolutions and information relating
to the convening of the Xeris Shareholder Meeting will be mailed as
promptly as reasonably practicable after securing approval of the
High Court to dispatch such documents to Strongbridge Shareholders
and, for information only, to holders of Strongbridge Options,
Strongbridge Warrants, Strongbridge Convertibles and Strongbridge
Share Awards.
It is expected that the Joint Proxy Statement (which will
contain the Scheme Document), containing further information
relating to the implementation of the Acquisition, the full terms
and conditions of the Scheme, notices of the Court Meeting, the EGM
and Xeris Shareholder Meeting and information on the Xeris
Biopharma Holdings Shares, will be made available to Strongbridge
Shareholders and Xeris Shareholders as promptly as reasonably
practicable after securing approval of the High Court to despatch
the Scheme Document to Strongbridge Shareholders and, for
information only, to holders of Strongbridge Warrants, Strongbridge
Options, Strongbridge Convertibles and Strongbridge Share
Awards.
The Joint Proxy Statement will be a part of the Form S-4 filed
with the SEC with respect to the issuance of the Xeris Biopharma
Holdings Shares pursuant to the Securities Act. Upon a declaration
of effectiveness by the SEC of the Form S-4, the Joint Proxy
Statement will constitute a prospectus of Xeris Biopharma
Holdings.
9. Merger Benefit Statement
Xeris anticipates that the Acquisition will provide
approximately $50 million in pre-tax
synergies and other cost reductions by the end of 2022.
The principal sources of potential synergies in 2022 are as
follows:
- approximately 51% of the $50
million from (i) the consolidation of R&D and business
and central support functions and the elimination of redundant
public company and other duplicate costs (approximately 41% of the
$50 million) and (ii) the avoidance
of future costs by utilizing Xeris' corporate infrastructure
(approximately 10% of the $50
million) and
- approximately 49% of the $50
million from (i) the reduction of overlapping operations
including marketing and medical affairs (approximately 15% of the
$50 million) and (ii) the avoidance
of future costs by utilizing Xeris' commercial and medical affairs
infrastructure (approximately 34% of the $50
million).
The synergies exclude any potential revenue synergies.
Subject to the Scheme becoming effective, Strongbridge
Shareholders will be able to share in any synergies resulting from
the Acquisition by means of the Xeris Biopharma Holdings Shares
they will receive under the Scheme.
There are various material assumptions underlying the synergy
(including cost reduction and cost avoidance) estimates which may
result in the synergies being materially greater or less than
estimated. The estimate of synergies should therefore be read in
conjunction with the key assumptions underlying the estimates set
out in Appendix I of this announcement.
The synergies, which include the cost reduction and cost
avoidance statements, should not be construed as a profit forecast
or interpreted to mean that Xeris Biopharma Holdings' profits or
earnings in the first full year following the Acquisition, or in
any subsequent period, would necessarily match or be greater than
or be less than those of Xeris and/or Strongbridge for the relevant
preceding financial period or any other period.
The estimate of synergies set out in this announcement has been
reported on for the purposes of Rule 19.3(b)(ii) of the Irish
Takeover Rules by (i) KPMG and (ii) SVB Leerink LLC. Copies of
their respective reports are included in Appendix IV and Appendix V
to this announcement. Each of KPMG and SVB Leerink LLC has given
and not withdrawn its consent to the issue of this announcement
with the inclusion of its report.
10. About Xeris Pharmaceuticals, Inc. and Xeris
Biopharma Holdings, Inc.
Xeris (Nasdaq: XERS) is a pharmaceutical company delivering
innovative solutions to simplify the experience of administering
important therapies that people rely on every day around the
world.
With a novel technology platform that enables ready-to-use,
room-temperature stable formulations of injectable and infusible
therapies, the company is advancing a portfolio of solutions in
various therapeutic categories, including its first commercial
product, Gvoke® in the U.S.. Its proprietary XeriSol™ and XeriJect™
formulation technologies have the potential to offer distinct
advantages over conventional product formulations, including
eliminating the need for reconstitution, enabling long-term,
room-temperature stability, significantly reducing injection
volume, and eliminating the requirement for intravenous (IV)
infusion. With Xeris' technology, new product formulations are
designed to be easier to use by patients, caregivers, and health
practitioners and help reduce costs for payers and the healthcare
system.
Xeris is headquartered in Chicago,
IL. For more information, visit www.Xerispharma.com, or
follow us on Twitter, LinkedIn or Instagram.
Xeris Biopharma Holdings is a corporation incorporated in
Delaware solely for the purpose of
effecting the Acquisition. To date Xeris Biopharma Holdings has not
conducted any activities other than those incidental to its
formation and the execution of the Transaction Agreement.
Immediately after and conditioned on the concurrent consummation
of the Acquisition, Wells MergerSub will merge with and into Xeris,
with the result that the separate corporate existence of Wells
MergerSub will cease and Xeris will continue as the surviving
corporation. At the Effective Time, all existing Xeris Shares will
be cancelled and will automatically be converted into the right to
receive Xeris Biopharma Holdings Shares on a one-for-one basis.
At and as of the Effective Time, it is expected that Xeris
Biopharma Holdings will be a publicly traded company listed on the
Nasdaq.
11. About Strongbridge Biopharma plc
Strongbridge (Nasdaq: SBBP) is a global commercial-stage
biopharmaceutical company focused on the development and
commercialization of therapies for rare diseases with significant
unmet needs. Strongbridge's rare endocrine franchise includes
RECORLEV® (levoketoconazole), an adrenal steroidogenesis inhibitor
with a New Drug Application that is currently under review by the
FDA for the treatment of endogenous Cushing's syndrome, and
veldoreotide extended release, a pre-clinical next-generation
somatostatin analog being investigated for the treatment of
acromegaly and potential additional applications in other
conditions amenable to somatostatin receptor activation. Both
RECORLEV and veldoreotide have received orphan drug designation
from the FDA and the European Medicines Agency. The company's rare
neuromuscular franchise includes KEVEYIS® (dichlorphenamide), the
first and only FDA-approved treatment for hyperkalemic,
hypokalemic, and related variants of primary periodic paralysis.
KEVEYIS has orphan drug exclusivity in the United States.
12. Effect of the Scheme on Strongbridge Options,
Strongbridge Share Awards and Strongbridge Warrants
Pursuant to the terms of the Transaction Agreement,
Strongbridge's outstanding equity awards will be treated as
follows: each unexercised Strongbridge Option will be
substituted with a Strongbridge Rollover Option, with the exercise
price per Xeris Biopharma Holdings Share and the number of Xeris
Biopharma Holdings Shares underlying the Strongbridge Rollover
Option adjusted to reflect the conversion from Strongbridge Shares
into Xeris Biopharma Holdings Shares. Each Strongbridge Rollover
Option will continue to have, and be subject to, the same terms and
conditions that applied to the corresponding Strongbridge Option
(except for terms rendered inoperative by reason of the Acquisition
or for immaterial administrative or ministerial changes that are
not adverse to any holder other than in any de
minimis respect). Upon completion of the Acquisition,
Xeris Biopharma Holdings will issue to each holder of a
Strongbridge Rollover Option (as of immediately prior to the
Effective Time) one (1) CVR with respect to each Strongbridge Share
subject to the applicable Strongbridge Option; provided that each
such CVR will be subject to the same vesting and forfeiture
conditions that applied to the corresponding Strongbridge Option;
and provided further that in no event will such holder be entitled
to any Milestone Payment unless the corresponding Strongbridge
Rollover Option has been exercised on or prior to the applicable
Milestone Payment Date.
Each Strongbridge Option will become fully vested and
exercisable immediately prior to the Effective Time.
Additionally, each Strongbridge Option with a per-share exercise
price prior to the adjustment described in the previous paragraph
of $4.50 or less will be amended to
provide that such corresponding Strongbridge Rollover Option will
remain exercisable for a period of time following the Effective
Time in accordance with its terms, but in no event less than a
period of time equal to the lesser of the maximum remaining term of
such Strongbridge Rollover Option and the fourth anniversary of the
Effective Date, in each case regardless of whether the holder of
such Strongbridge Rollover Option experiences a termination of
employment or service on or following the Effective Time.
Pursuant to the terms of the Transaction Agreement, prior to the
Effective Time, Strongbridge will issue a number of Strongbridge
Shares subject to the vested portion of each Strongbridge Share
Award. Each such Strongbridge Share will be treated at the
Effective Time the same as, and have the same rights and be subject
to the same conditions as, all other Strongbridge Shares.
Pursuant to the terms of the Transaction Agreement,
Strongbridge's outstanding warrants will be treated as follows: (i)
each outstanding and unexercised Strongbridge Private Placement
Warrant will be assumed by Xeris Biopharma Holdings such that the
applicable holders will have the right to subscribe for Xeris
Biopharma Holdings Shares, in accordance with certain terms of the
Strongbridge Private Placement Warrant; and (ii) each outstanding
and unexercised Strongbridge Assumed Warrant will be assumed by
Xeris Biopharma Holdings such that, upon exercise, the applicable
holders will have the right to have delivered to them the Reference
Property (as such term is defined in the Strongbridge Assumed
Warrants), in accordance with certain terms of the Strongbridge
Assumed Warrant.
13. Effect of the Scheme on Strongbridge
Convertibles
If required in accordance with Rule 15 of the Irish Takeover
Rules, Xeris and Xeris Biopharma Holdings will make appropriate
proposals in relation to the Strongbridge Convertibles. Holders of
Strongbridge Convertibles will, if required, be contacted at the
time of publication of the Joint Proxy Statement (which will
contain the Scheme Document), regarding the effect of the
Acquisition on the Strongbridge Convertibles and the relevant
details will be summarized in the Joint Proxy Statement (which will
contain the Scheme Document).
14. Management and Employees
Pursuant to the terms of the Transaction Agreement, Xeris has
given certain assurances in relation to the continuation of certain
existing compensation and employment benefit arrangements of
Strongbridge's employees following the Acquisition.
Further details in this regard will be included in the Joint
Proxy Statement (which will contain the Scheme Document).
15. Delisting and Cancellation of Trading of Xeris and
Strongbridge and Admission to Trading of Xeris Biopharma
Holdings
It is intended that, subject to and following the Scheme and
Merger becoming effective, and subject to applicable requirements
of the Nasdaq, the Xeris Shares will be delisted from the Nasdaq
and the Strongbridge Shares will be delisted from the Nasdaq. The
last day of dealing in Strongbridge Shares on the Nasdaq and Xeris
Shares on the Nasdaq will be the last Business Day before the
Effective Date (or, in certain circumstances, the Effective Date).
It is expected that Xeris Biopharma Holdings Shares will commence
trading on the Nasdaq on the Effective Date (or, in certain
circumstances, the Business Day after the Effective Date).
16. Expenses Reimbursement Agreement
Strongbridge has entered into the Expenses Reimbursement
Agreement dated May 24, 2021 with
Xeris, the entry into which has been consented to by the Panel.
Under the Expenses Reimbursement Agreement, Strongbridge has agreed
to pay to Xeris in certain circumstances set out below an amount
equal to all documented, specific and quantifiable third party
costs and expenses incurred, directly or indirectly, by Xeris
and/or the Xeris Group (as defined in the Expenses Reimbursement
Agreement), or on their behalf, for the purposes of, in preparation
for, or in connection with the Acquisition, including, but not
limited to, third party expenses incurred in connection with
exploratory work carried out in contemplation of and in connection
with the Acquisition, legal, financial and commercial due diligence
and engagement of third party representatives to assist in the
process. The liability of Strongbridge to pay these amounts shall
arise only after the date of this announcement and is limited to a
maximum amount of $1.95 million. The
amount payable by Strongbridge to Xeris under the Expenses
Reimbursement Agreement will exclude any amounts in respect of VAT
incurred by Xeris attributable to such third party costs other than
Irrecoverable VAT (as defined in the Expenses Reimbursement
Agreement) incurred by Xeris on such costs. The circumstances in
which such payment will be made are if:
(a) the Transaction Agreement is
terminated:
(i) by Xeris at any time prior to
the receipt of the Strongbridge Shareholder Approval, due to a
Strongbridge Change of Recommendation having occurred; or
(ii) by Xeris at any time prior to
the receipt of the Strongbridge Shareholder Approval, if
Strongbridge shall have materially breached Section 5.3 of the
Transaction Agreement; or
(b) all of the following
occur:
(i) the Transaction Agreement is
terminated (x) by Xeris for the reason Strongbridge shall have
breached or failed to perform in any material respect any of its
covenants or other agreements contained in the Transaction
Agreement, or if any of its representations or warranties set forth
in the Transaction Agreement are inaccurate, which breach or
failure to perform or inaccuracy (1) would have resulted in a
failure of any of the Conditions 1, 2, 3 or 4 of Appendix III and
(2) is not reasonably capable of being cured by the End Date or, if
curable, is not cured by the earlier of (a) the End Date and (b) 30
days following written notice by Xeris thereof or (y) by Xeris or
Strongbridge, if the Court Meeting or the EGM was completed and the
Court Meeting Resolution or the Required EGM Resolutions, as
applicable, were not approved by the requisite majorities; and
(ii) prior to the Court Meeting, a
Strongbridge Alternative Proposal was publicly disclosed or
announced (or, in the case of a termination described in paragraph
(b)(i)(x) above, was made publicly or privately to the Strongbridge
Board), or any person shall have publicly announced an intention
(whether or not conditional) to make a Strongbridge Alternative
Proposal (it being understood that, for purposes of this paragraph
(b)(ii) and paragraph (b)(iii) below, references to "20%" in the
definition of Strongbridge Alternative Proposal shall be deemed to
refer to "50%"); and
(iii) (x) a Strongbridge
Alternative Proposal is consummated within twelve months after such
termination, or (y) a definitive agreement providing for a
Strongbridge Alternative Proposal is entered into within twelve
months after such termination and which is subsequently
consummated, in the case of each of clauses (x) and (y), regardless
of whether such Strongbridge Alternative Proposal is the same
Strongbridge Alternative Proposal referred to in paragraph (b)(ii)
above.
The Panel has consented to Strongbridge entering into the
Expenses Reimbursement Agreement. In this regard, each of MTS
Health Partners, LP and the Strongbridge Independent Directors have
confirmed in writing to the Panel that, in the opinion of MTS
Health Partners, LP and the Independent Strongbridge Directors
(respectively), in the context of the note to Rule 21.2 of the
Irish Takeover Rules and the Acquisition, the Expenses
Reimbursement Agreement is in the best interests of the
Strongbridge Shareholders.
17. Transaction Agreement
Xeris, Xeris Biopharma Holdings, Wells MergerSub and
Strongbridge have entered into the Transaction Agreement dated
May 24, 2021 which contains certain
assurances, obligations and commitments in relation to the
implementation of the Scheme, including provisions in relation to
the conduct of Strongbridge's business between the date of this
announcement and the Effective Date and other matters relating to
the Acquisition. A copy of the Transaction Agreement is appended to
this announcement at Appendix VI and a summary of the principal
terms of the Transaction Agreement will be set out in the Joint
Proxy Statement (which will also contain the Scheme Document).
18. Xeris Shareholder Approval
Pursuant to the Transaction Agreement, Wells MergerSub will
merge with and into Xeris with Xeris continuing as the surviving
corporation in the Merger and in consideration of which Xeris
Shareholders will receive one share in Xeris Biopharma Holdings for
each Xeris Share held by them on completion. As a result of that,
Xeris Shareholders holding a majority of the outstanding Xeris
Shares must vote to approve the Transaction Agreement at a special
shareholder meeting to be convened by Xeris. Xeris is required to
send Xeris Shareholders the Joint Proxy Statement summarizing the
background to and reasons for the transactions to be consummated
pursuant to the Transaction Agreement (which will include a notice
convening the Xeris Shareholder Meeting) as well as information
relating to the Merger and the Xeris Biopharma Holdings Shares.
19. Independent Xeris Directors Recommendation
The Independent Xeris Directors consider the terms of the
Acquisition and the Merger to be advisable, consistent with, and in
furtherance of the strategies and goals of Xeris and that the
entry into the Transaction Agreement and the Merger are fair to and
in the best interests of Xeris and the
Xeris Shareholders. In connection with reaching such
determination, the Independent Xeris Directors have received an
opinion from its financial advisor, SVB Leerink LLC, that, as of
the date thereof and subject to the various assumptions,
qualifications and limitations set forth in the opinion, the
consideration (provided for in the Transaction Agreement) is fair,
from a financial point of view, to the holders of Xeris Shares
(other than Xeris Shares owned by Xeris, Strongbridge or any of its
wholly owned subsidiaries). Accordingly, the Independent Xeris
Directors unanimously recommend to Xeris Shareholders to vote
to approve the Transaction Agreement and the Merger.
Jeffrey W. Sherman, M.D., is not
participating in the Independent Xeris Directors' recommendation as
Dr. Sherman may be considered as having a conflict of interest
due to Dr. Sherman's directorship of and shareholding in
Strongbridge.
20. Disclosure of interests in relevant securities of
Strongbridge
As at the close of business on May 21,
2021 (being the last practicable date prior to the release
of this announcement), neither SVB Leerink LLC, financial adviser
to Xeris, nor any person (other than an exempt principal trader or
an exempt fund manager) controlling, controlled by, or under the
same control as, SVB Leerink LLC was interested in, or held short
positions in, Strongbridge securities.
As at the close of business on May 21,
2021 (being the last practicable date prior to the release
of this announcement), Jeffrey W. Sherman, M.D., a director of
Xeris, was the owner of 42,021 Strongbridge Shares and 40,000
Strongbridge Restricted Share Units.
Save as described above, at the close of business on
May 21, 2021 (being the last
practicable date prior to the release of this announcement), none
of Xeris, Xeris Biopharma Holdings or, so far as Xeris is aware,
any person Acting in Concert with Xeris:
(a) had an interest in relevant securities of
Strongbridge;
(b) had any short position in relevant securities of
Strongbridge;
(c) had received an irrevocable commitment or letter
of intent to accept the terms of the Acquisition in respect of
relevant securities of Strongbridge; or
(d) had borrowed or lent any Strongbridge Shares.
Furthermore, no arrangement to which Rule 8.7 of the Irish
Takeover Rules applies exists between Xeris, Xeris Biopharma
Holdings or Strongbridge or a person Acting in Concert with Xeris,
Xeris Biopharma Holdings or Strongbridge in relation to
Strongbridge Shares. For these purposes, an "arrangement to which
Rule 8.7 of the Irish Takeover Rules applies" includes any
indemnity or option arrangement, and any agreement or
understanding, formal or informal, of whatever nature, between two
or more persons relating to relevant securities which is or may be
an inducement to one or more of such persons to deal or refrain
from dealing in such securities.
In the interests of confidentiality, Xeris, Xeris Biopharma
Holdings and SVB Leerink LLC have made only limited enquiries in
respect of certain parties who may be deemed by the Panel to be
Acting in Concert with them for the purposes of the Acquisition.
Further enquiries will be made to the extent necessary as soon as
practicable following the date of this announcement and any
disclosure in respect of such parties will be included in the
Scheme Document.
21. Rule 2.10 Disclosure
In accordance with Rule 2.10 of the Takeover Rules, Strongbridge
confirms that, as of the close of business on May 21, 2021, Strongbridge's issued share
capital, excluding treasury shares, is comprised of 67,722,319
ordinary shares with a par value of $0.01 per share. Strongbridge's ordinary shares
are traded on the Nasdaq under the symbol SBBP. The International
Securities Identification Number (ISIN) of the Strongbridge
ordinary shares is IE00BYZ5XL97.
Strongbridge confirms that, as of the close of business on
May 21, 2021, there were outstanding
2,942,341 restricted share units (the "Strongbridge Restricted
Share Units") and 8,763,074 options to purchase Strongbridge
ordinary shares (the "Strongbridge Share Options") granted by
Strongbridge. Upon vesting, each Strongbridge Restricted
Share Unit entitles the holder to receive one Strongbridge ordinary
share and each Strongbridge Share Option entitles the holder to
purchase one Strongbridge ordinary share at the applicable exercise
price.
Strongbridge also confirms that as of the close of business on
May 21, 2021, Strongbridge has
7,368,033 warrants outstanding (the "Strongbridge Warrants") and up
to 1,339,285 ordinary shares may be issued upon the conversion of
the portion of Strongbridge's debt that is convertible. Upon
exercise, each Strongbridge Warrant entitles the holder to receive
one ordinary share.
In accordance with Rule 2.10 of the Irish Takeover Rules, Xeris
confirms that, as of close of business on May 21, 2021, Xeris' issued share capital,
excluding treasury shares, is comprised of 66,372,010 shares of
common stock with a par value of $0.001 per share. Xeris' common stock is traded
on the Nasdaq under the symbol XERS. The International Securities
Identification Number (ISIN) of the Xeris common stock is
US98422L1070.
Xeris confirms that, as of the close of business on May 21, 2021, there were outstanding 5,145,099
options to purchase shares of common stock (the "Xeris Stock
Options"), 1,883,012 restricted stock units (the "Xeris Restricted
Stock Units"), 94,012 warrants (the "Xeris Warrants") and a
principal amount of $47,175,000 of
5.00% Convertible Senior Notes due 2025 (the "Xeris Convertible
Notes").
Upon exercise, each Xeris Stock Option entitles the holder to
purchase one share of common stock at the applicable exercise
price. Upon vesting, each Xeris Restricted Stock Unit entitles the
holder to receive one share of common stock. Upon exercise, each
Xeris Warrant entitles the holder to receive one share of common
stock. Upon conversion of the Xeris Convertible Notes, up to
15,416,667 Xeris Shares may be issued.
22. Rule 30.2 Derogation
Rule 30.2 of the Irish Takeover Rules requires that, except with
the consent of the Panel, and subject to Rule 2.7 of the Irish
Takeover Rules, Strongbridge must despatch the Scheme Document to
Strongbridge Shareholders within 28 days of the announcement of a
firm intention to make an offer, being this announcement.
On May 19, 2021 the Panel agreed
to grant the parties a derogation from Rule 30.2.
There is a requirement to file a Form S-4 with the SEC in
connection with the Acquisition. The Form S-4 will contain the
Joint Proxy Statement (which will also contain the Scheme
Document). The preparation of the Form S-4 may take more than 28
days. Also, the SEC may elect to review the Form S-4 prior to
declaring it effective. This review process may take 60 days or
more to complete. Under SEC rules, the Scheme Document cannot be
dispatched to Strongbridge Shareholders or Xeris Shareholders until
the Form S-4 is declared effective by the SEC. The Panel granted
the derogation on the basis that the Scheme Document cannot be
dispatched until the Form S-4 is declared effective by the SEC. The
Scheme Document will be dispatched to Strongbridge Shareholders as
soon as practicable after the Form S-4 is declared effective.
23. General
The Acquisition and the Scheme will be made subject to the
Conditions and the further terms and conditions to be set out in
the Scheme Document. The Scheme Document will include full details
of the Acquisition and will be accompanied by the appropriate forms
of proxy.
Xeris reserves the right, subject to the terms of the
Transaction Agreement, to elect to implement the Acquisition by way
of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel's
consent. In such event, the Acquisition will be implemented on
terms at least as favorable, so far as applicable, as those which
would apply to the Scheme, subject to appropriate amendments
(including an acceptance condition set at 80% of the shares to
which such offer relates or such lesser percentage, being more than
50%, as Xeris may, with the consent of the Panel (if required),
decide).
The Transaction Agreement is governed by the laws of the
State of Delaware. However, the
Acquisition and the Scheme and matters related thereto (including
matters related to the Irish Takeover Rules) shall, to the extent
required by the laws of Ireland,
be governed by, and construed in accordance with, the laws of
Ireland. The interpretation of the
duties of directors of Strongbridge shall also be governed by, and
construed in accordance with, the laws of Ireland.
Appendix I to this announcement contains further details of the
sources of information and bases of calculations set out in this
announcement; Appendix II to this announcement contains definitions
of certain expressions used in this announcement; Appendix III to
this announcement contains the Conditions of the Acquisition and
the Scheme; Appendix IV to this announcement sets out the report
from KPMG in respect of certain merger benefit statements made in
this announcement; Appendix V to this announcement contains the
report from SVB Leerink LLC, in respect of certain merger benefit
statements made in this announcement; Appendix VI to this
announcement sets out the Transaction Agreement; and Appendix VII
to this announcement sets out the form of the CVR Agreement.
Contacts
Xeris Pharmaceuticals
Allison Wey
Senior Vice President, Investor Relations and Corporate
Communications
awey@Xerispharma.com
+1 312-736-1237
Strongbridge Biopharma
Elixir Health Public Relations
Lindsay Rocco
+1 862-596-1304
lrocco@elixirhealthpr.com
Joele Frank, Wilkinson Brimmer
Katcher
Andy Brimmer
+1 212-355-4449
No Offer or Solicitation
This announcement is for information purposes only and is not
intended to and does not constitute an offer to sell or the
solicitation of an offer to subscribe for or buy or an invitation
to purchase or subscribe for any securities or the solicitation of
any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise, nor shall there be any sale, issuance or
transfer of securities in any jurisdiction in contravention of
applicable law. In particular, this announcement is not an offer of
securities for sale into the United
States. No offer of securities shall be made in the United States absent registration under
the Securities Act or pursuant to an exemption from, or in a
transaction not subject to, such registration requirements. The
Acquisition will be made solely by means of the Scheme Document
(or, if applicable, the Takeover Offer Document), which will
contain the full terms and conditions of the Acquisition, including
details of how Strongbridge Shareholders may vote in respect of the
Acquisition.
Important Additional Information will be Filed with the
SEC
Xeris, Xeris Biopharma Holdings and Strongbridge will prepare
and Xeris Biopharma Holdings will file with the SEC a Registration
Statement on Form S-4 that will include a joint proxy statement of
Strongbridge and Xeris and that also will constitute a prospectus
with respect to the Xeris Biopharma Holdings Shares to be issued
pursuant to the Acquisition (the Joint Proxy Statement). The Joint
Proxy Statement will also contain the Scheme Document and further
information relating to the implementation of the Acquisition, the
full terms and conditions of the Scheme, notices of the Xeris
Shareholder Meeting and the Strongbridge Meetings and information
on the Xeris Biopharma Holdings Shares. Xeris and Strongbridge may
also file other documents with the SEC regarding the Acquisition.
This document is not a substitute for the Joint Proxy Statement or
any other document which Xeris, Xeris Biopharma Holdings or
Strongbridge may file with the SEC.
The Joint Proxy Statement, if and when filed, as well as Xeris'
and Strongbridge's other public filings with the SEC, may be
obtained without charge at the SEC's website at www.sec.gov and, in
the case of Xeris' filings, at Xeris' website at
www.Xerispharma.com, and in the case of Strongbridge's filings, at
Strongbridge's website at www.Strongbridgebio.com.
INVESTORS, XERIS SHAREHOLDERS AND STRONGBRIDGE SHAREHOLDERS ARE
URGED TO READ THE JOINT PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS
ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN
THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE ACQUISITION AND RELATED MATTERS.
Any vote in respect of resolutions to be proposed at the
Strongbridge Meetings to approve the Acquisition, the Scheme or
related matters, or other responses in relation to the Acquisition,
should be made only on the basis of the information contained in
the Joint Proxy Statement (including the Scheme Document).
Similarly, any vote in respect of resolutions to be proposed at the
Xeris Shareholder Meeting should be made only on the basis of the
information contained in the Joint Proxy Statement.
Participants in the Solicitation
Xeris, Xeris Biopharma Holdings, Strongbridge and their
respective directors and executive officers and employees may be
deemed to be participants in the solicitation of proxies from their
respective shareholders in connection with the Acquisition.
Information regarding the persons who may, under the rules of the
SEC, be deemed to be participants in the solicitation of
shareholders in connection with the Acquisition, including a
description of their direct or indirect interests, which may be
different from those of Xeris Shareholders or Strongbridge
Shareholders generally, by security holdings or otherwise, will be
set forth in the Joint Proxy Statement (which will contain the
Scheme Document) and any other relevant documents that are filed or
will be filed with the SEC relating to the Acquisition. Information
regarding Xeris' directors and executive officers is contained in
Xeris' Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on
March 9, 2021, and its Proxy
Statement on Schedule 14A, dated and filed with the SEC on
April 29, 2021. Information regarding
Strongbridge's directors and executive officers is contained
in Strongbridge's Annual Report on Form 10-K for the year ended
December 31, 2020, filed with the SEC
on March 3, 2021, and its Proxy
Statement on Schedule 14A, dated and filed with the SEC on
April 14, 2021. You may obtain free
copies of these documents using the sources indicated above.
Forward-Looking Statements
This announcement contains certain forward-looking statements
with respect to a proposed transaction involving Xeris and
Strongbridge and Xeris', Strongbridge's and/or the combined group's
estimated or anticipated future business, performance and results
of operations and financial condition, including estimates,
forecasts, targets and plans for Xeris and Strongbridge and,
following the acquisition, if completed, the combined group. The
words "believe," "expect," "anticipate," "project" and similar
expressions, among others, generally identify forward-looking
statements. These forward-looking statements are subject to risks
and uncertainties that may cause actual results to differ
materially from those indicated in the forward-looking statements.
Such risks and uncertainties include, but are not limited to, the
possibility that a possible acquisition will not be pursued,
failure to obtain necessary shareholder or regulatory approvals or
required financing or to satisfy any of the other conditions to the
possible acquisition, the reaction of Xeris' and Strongbridge's
shareholders to the proposed transaction, adverse effects on the
market price of Xeris Shares or Strongbridge Shares and on Xeris'
or Strongbridge's operating results because of a failure to
complete the possible acquisition, failure to realize the expected
benefits of the possible acquisition, failure to promptly and
effectively integrate Strongbridge's businesses, negative effects
relating to the announcement of the possible acquisition or any
further announcements relating to the possible acquisition or the
consummation of the possible acquisition on the market price of
Xeris Shares or Strongbridge Shares, significant transaction costs
and/or unknown or inestimable liabilities, the risk that any
potential payment of proceeds pursuant to the CVR Agreement may not
be distributed at all or result in any value to Strongbridge
Shareholders, potential litigation associated with the possible
acquisition, general economic and business conditions that affect
the combined companies following the consummation of the possible
acquisition, the impact of the COVID-19 pandemic on Xeris' or
Strongbridge's businesses or the combined businesses following the
consummation of the transaction, changes in global, political,
economic, business, competitive, market and regulatory forces,
future exchange and interest rates, changes in tax laws,
regulations, rates and policies, future business acquisitions or
disposals and competitive developments. These forward-looking
statements are based on numerous assumptions and assessments made
in light of Xeris' or, as the case may be, Strongbridge's
experience and perception of historical trends, current conditions,
business strategies, operating environment, future developments and
other factors it believes appropriate. By their nature,
forward-looking statements involve known and unknown risks and
uncertainties because they relate to events and depend on
circumstances that will occur in the future. The factors described
in the context of such forward-looking statements in this
announcement could cause Xeris' plans with respect to Xeris or
Strongbridge, Strongbridge's or Xeris' actual results, performance
or achievements, industry results and developments to differ
materially from those expressed in or implied by such
forward-looking statements. Although it is believed that the
expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will
prove to have been correct and persons reading this announcement
are therefore cautioned not to place undue reliance on these
forward-looking statements which speak only as at the date of this
announcement. Additional information about economic, competitive,
governmental, technological and other factors that may affect Xeris
is set forth in Item 1A, "Risk Factors," in Xeris' 2020 Annual
Report on Form 10-K, which has been filed with the SEC, the
contents of which are not incorporated by reference into, nor do
they form part of, this announcement. Additional information about
economic, competitive, governmental, technological and other
factors that may affect Strongbridge is set forth in Item 1A, "Risk
Factors," in Strongbridge's 2020 Annual Report on Form 10-K, which
has been filed with the SEC, the contents of which are not
incorporated by reference into, nor do they form part of, this
announcement.
Any forward-looking statements in this announcement are based
upon information available to Xeris, Strongbridge and/or their
respective boards of directors, as the case may be, as of the date
of this announcement and, while believed to be true when made, may
ultimately prove to be incorrect. Subject to any obligations under
applicable law, none of Xeris, Strongbridge or any member of their
respective boards of directors undertakes any obligation to update
any forward-looking statement whether as a result of new
information, future developments or otherwise, or to conform any
forward-looking statement to actual results, future events, or to
changes in expectations. All subsequent written and oral
forward-looking statements attributable to Xeris, Strongbridge or
their respective boards of directors or any person acting on behalf
of any of them are expressly qualified in their entirety by this
paragraph.
Statement Required by the Irish Takeover Rules
The Xeris Directors and the Xeris Biopharma Holdings Directors
accept responsibility for the information contained in this
announcement other than that relating to Strongbridge, the
Strongbridge Group, and the Strongbridge Directors, and members of
their immediate families, related trusts and persons connected with
them, and for the statements made by Strongbridge in respect of
Xeris and Xeris Biopharma Holdings and the recommendation and
related opinions of the Independent Strongbridge Directors. The
Independent Xeris Directors accept responsibility for the
recommendation and the related opinions of the Independent Xeris
Directors contained in this announcement. To the best of the
knowledge and belief of the Xeris Directors, the Xeris Biopharma
Holdings Directors and the Independent Xeris Directors (who, in
each case, have taken all reasonable care to ensure such is the
case), the information contained in this announcement for which
they respectively accept responsibility is in accordance with the
facts and does not omit anything likely to affect the import of
such information.
The Strongbridge Directors accept responsibility for the
information contained in this announcement relating to
Strongbridge, the Strongbridge Group and the Strongbridge Directors
and members of their immediate families, related trusts and persons
connected with them, except for the statements made by Xeris in
respect of Strongbridge and the recommendation and related opinions
of the Independent Strongbridge Directors contained in this
announcement. The Independent Strongbridge Directors accept
responsibility for the recommendation and the related opinions of
the Independent Strongbridge Directors contained in this
announcement. To the best of the knowledge and belief of the
Strongbridge Directors and the Independent Strongbridge Directors
(who, in each case, have taken all reasonable care to ensure such
is the case), the information contained in this announcement for
which they respectively accept responsibility is in accordance with
the facts and does not omit anything likely to affect the import of
such information.
SVB Leerink LLC is acting as Xeris' financial advisor in
connection with the Acquisition. In connection with the
Acquisition, SVB Leerink LLC and its directors, officers,
employees, affiliates, and agents will not regard any other person
as its client, nor will it be responsible to anyone other than
Xeris for providing the protections afforded to clients of SVB
Leerink LLC or for giving advice in connection with the Acquisition
or any matter referred to herein.
MTS Health Partners, LP is acting as financial adviser to
Strongbridge in connection with the Acquisition. In connection with
the Acquisition, MTS Health Partners, LP and its directors,
officers, employees, affiliates, and agents will not regard any
other person as its client, nor will it be responsible to anyone
other than Strongbridge for providing the protections afforded to
clients of MTS Health Partners, LP or for giving advice in
connection with the Acquisition or any matter referred to
herein.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the Irish Takeover Rules, if
any person is, or becomes, 'interested' (directly or indirectly) in
1% or more of any class of 'relevant securities' of Strongbridge or
Xeris, all 'dealings' in any 'relevant securities' of Strongbridge
or Xeris (including by means of an option in respect of, or a
derivative referenced to, any such 'relevant securities') must be
publicly disclosed by not later than 3:30
pm (New York time) on the
'business' day following the date of the relevant transaction. This
requirement will continue until the date on which the Scheme
becomes effective or on which the 'offer period' otherwise ends. If
two or more persons cooperate on the basis of any agreement, either
express or tacit, either oral or written, to acquire an 'interest'
in 'relevant securities' of Strongbridge or Xeris, they will be
deemed to be a single person for the purpose of Rule 8.3 of the
Irish Takeover Rules.
Under the provisions of Rule 8.1 of the Irish Takeover Rules,
all 'dealings' in 'relevant securities' of Strongbridge by Xeris or
'relevant securities' of Xeris by Strongbridge, or by any party
acting in concert with either of them, must also be disclosed by no
later than 12 noon (New York time)
on the 'business' day following the date of the relevant
transaction.
A disclosure table, giving details of the companies in whose
'relevant securities' 'dealings' should be disclosed, can be found
on the Panel's website at www.irishtakeoverpanel.ie.
'Interests in securities' arise, in summary, when a person has
long economic exposure, whether conditional or absolute, to changes
in the price of securities. In particular, a person will be treated
as having an 'interest' by virtue of the ownership or control of
securities, or by virtue of any option in respect of, or derivative
referenced to, securities.
Terms in single quotation marks are defined in the Irish
Takeover Rules, which can also be found on the Panel's website. If
you are in any doubt as to whether or not you are required to
disclose a dealing under Rule 8, please consult the Panel's website
at www.irishtakeoverpanel.ie or contact the Panel on telephone
number +353 1 678 9020.
No Profit Forecast / Asset Valuations
No statement in this announcement is intended to constitute a
profit forecast for any period, nor should any statements be
interpreted to mean that earnings or earnings per share will
necessarily be greater or lesser than those for the relevant
preceding financial periods for Xeris, Xeris Biopharma Holdings or
Strongbridge as appropriate. No statement in this announcement
constitutes an asset valuation.
Publication on Website
Pursuant to Rule 2.6(c) of the Irish Takeover Rules, this
announcement will be available to Xeris employees on Xeris' website
www.Xerispharma.com and Strongbridge employees on Strongbridge's
website www.Strongbridgebio.com. Neither the content of any such
website nor the content of any other website accessible from
hyperlinks on such website is incorporated into, or forms part of,
this announcement.
Right to Switch to a Takeover Offer
Xeris reserves the right, subject to the terms of the
Transaction Agreement, to elect to implement the Acquisition by way
of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel's
consent. In such event, the Acquisition will be implemented on
terms at least as favorable, so far as applicable, as those which
would apply to the Scheme, subject to appropriate amendments
(including an acceptance condition set at 80% of the shares to
which such offer relates).
If Xeris exercises its right to implement the Acquisition by way
of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel's
consent, such Takeover Offer would be made in compliance with
applicable U.S. Law and regulations, including the registration
requirements of the Securities Act and the tender offer rules
under the Exchange Act and any applicable exemptions provided
thereunder.
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, any figures shown
for the same category presented in different tables may vary
slightly and figures shown as totals in certain tables may not be
an arithmetic aggregation of the figures that precede them.
General
This summary should be read in conjunction with, and is subject
to, the full text of this announcement (including its
Appendices).
The Acquisition is subject to, inter alia, the satisfaction or
waiver (as applicable) of the Conditions set out in Appendix III to
this announcement and to the full terms and conditions which will
be set out in the Joint Proxy Statement (which will contain the
Scheme Document).
Appendix I to this announcement contains further details of the
sources of information and bases of calculations set out in this
announcement; Appendix II to this announcement contains definitions
of certain expressions used in this announcement; Appendix III to
this announcement contains the Conditions of the Acquisition and
the Scheme; Appendix IV to this announcement sets out the report
from KPMG in respect of certain merger benefit statements made in
this announcement; Appendix V to this announcement contains the
report from SVB Leerink LLC in respect of certain merger benefit
statements made in this announcement; Appendix VI to this
announcement sets out the Transaction Agreement; and Appendix VII
to this announcement sets out the form of the CVR Agreement.
The release, publication or distribution of this announcement in
or into certain jurisdictions may be restricted by the laws of
those jurisdictions, including any Restricted Jurisdictions.
Accordingly, copies of this announcement and all other documents
relating to the Acquisition are not being, and must not be,
released, published, mailed or otherwise forwarded, distributed or
sent in, into or from any such Restricted Jurisdictions. Persons
receiving such documents (including, without limitation, nominees,
trustees and custodians) should observe these restrictions. Failure
to do so may constitute a violation of the securities laws of any
such jurisdiction. To the fullest extent permitted by applicable
Law, the companies involved in the Acquisition disclaim any
responsibility or liability for the violations of any such
restrictions by any person.
Any response in relation to the Acquisition should be made only
on the basis of the information contained in the Joint Proxy
Statement (including the Scheme Document) or any document by which
the Acquisition and the Scheme are made. Strongbridge Shareholders
are advised to read carefully the formal documentation in relation
to the proposed acquisition once the Joint Proxy Statement
(including the Scheme Document) has been despatched.
This announcement has been prepared for the purpose of complying
with the laws of Ireland and the
Irish Takeover Rules and the information disclosed may not be the
same as that which would have been disclosed if this announcement
had been prepared in accordance with the laws of jurisdictions
outside of Ireland.
This announcement does not constitute a prospectus or prospectus
equivalent document.
If you are in any doubt about the contents of this announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your appropriately
authorized independent financial adviser.
APPENDIX I
SOURCES AND BASES OF INFORMATION
- In this announcement, unless otherwise stated or the context
otherwise requires, the following bases and sources have been used:
- The historical share prices are sourced from the Nasdaq for
both Xeris and Strongbridge;
- The entire issued and to be issued share capital (fully diluted
share capital) of Xeris (including the value thereof) is calculated
on the basis of:
- 66,372,010 Xeris Shares, being the entire issued ordinary share
capital excluding treasury shares at May 21,
2021;
- 1,883,012 issued Xeris Restricted Stock Units;
- 649,364 issued Xeris Stock Options (calculated based on the
treasury stock method based on closing prices as of May 21, 2021);
- 0 (zero) issued Xeris Warrants (calculated based on the
treasury stock method based on closing prices as of May 21, 2021);
- 15,416,667 Xeris Shares to be issued on conversion of the Xeris
Convertible Notes;
- The entire issued and to be issued share capital (fully diluted
share capital) of Strongbridge (including the value thereof) is
calculated on the basis of:
- 67,722,319 Strongbridge Shares, being the entire issued
ordinary share capital excluding treasury shares at May 21, 2021; and
- 205,572 issued Strongbridge Options (calculated based on the
treasury stock method based on closing prices as of May 21, 2021);
- 2,942,341 issued Strongbridge RSUs;
- 591,079 issued Strongbridge Warrants (calculated based on the
treasury stock method based on closing prices as of May 21, 2021);
- 236,595 Strongbridge Shares to be issued on conversion of the
Strongbridge Convertibles (based on methodology agreed between
Xeris and Strongbridge);
- All share prices expressed in US dollars have been rounded to
the nearest whole cent and all percentages have been rounded to the
nearest whole number;
- Save where otherwise stated, financial and other information
concerning Xeris and Strongbridge has been extracted from published
sources or from audited financial results of Xeris and
Strongbridge;
- References to the transaction-related arrangements in place
between Xeris and Strongbridge are sourced from the Transaction
Agreement;
- References to the arrangements in place between Xeris and
Strongbridge regarding an expenses reimbursement agreement are
sourced from the terms of the Expenses Reimbursement Agreement;
and
- References to the arrangements in place between Xeris and
Strongbridge regarding the CVRs are sourced from the terms of the
CVR Agreement.
- The bases of belief (including sources of information and
assumptions made) that support the expected synergies and other
cost reductions are set out in the following paragraphs. The
estimate of synergies has been reported on in accordance with
Rule 19.3(b)(ii) of the Irish Takeover Rules.
- The principal sources of potential synergies in 2022 are as
follows:
- approximately 51% of the $50
million from (i) the consolidation of R&D and business
and central support functions and the elimination of redundant
public company and other duplicate costs (approximately 41% of the
$50 million) and (ii) the avoidance
of future costs by utilizing Xeris' corporate infrastructure
(approximately 10% of the $50
million) and
- approximately 49% of the $50
million from (i) the reduction of overlapping operations
including marketing and medical affairs (approximately 15% of the
$50 million) and (ii) the avoidance
of future costs by utilizing Xeris' commercial and medical affairs
infrastructure (approximately 34% of the $50
million).
- Synergy planning commenced in advance of the first approach by
Xeris to the Strongbridge Board, when a Xeris working group,
including members of the executive leadership team and other
functional experts, was established to evaluate and assess the
potential synergies available from the Acquisition and undertake an
initial planning exercise.
- Xeris' management, aided by its previous operational and
integration experience and through an understanding of
Strongbridge's operations and cost structure based on their own
market intelligence and industry experience, and due diligence
materials provided by Strongbridge, subsequently determined the
source and scale of potential pre-tax synergies and other cost
reductions. The pre-tax synergies and other cost reductions are
incremental to Xeris' and, to the best of Xeris' knowledge,
Strongbridge's existing plans.
- In preparing the merger benefits statement, both Xeris and
Strongbridge have shared certain operating and financial
information to facilitate an analysis in support of evaluating the
potential synergies available from the Acquisition. In
circumstances where data has been limited for commercial or other
reasons, Xeris has made estimates and assumptions to aid its
development of individual synergy initiatives. The assessment and
quantification of the potential synergies have in turn been
informed by Xeris' management's industry experience and knowledge
of the existing businesses.
- When evaluating potential pre-tax cost synergies and other cost
reductions the Xeris Board has assumed the following:
- the cost bases for the quantification exercise are:
- in respect of Xeris, the existing cost base and the projected
cost base from 1 January 2021 to
31 December 2022; and
- in respect of Strongbridge, the existing cost base and the
projected cost base from 1 January
2021 to 31 December 2022
- FDA approval of levoketoconazole (proposed proprietary
name of "Recorlev") and a requirement for an additional 33
Strongbridge (on a standalone basis) full time sales, marketing,
commercial operations and medical affairs employees in order to
implement an effective sales strategy for Recorlev;
- that the Scheme will become effective and Xeris Biopharma
Holdings will acquire 100% of the issued and to be issued share
capital of Strongbridge on completion of the Acquisition;
- that there will be no material unanticipated impact on the
combined company arising from any decisions made by competition or
regulatory authorities;
- that there will be no material change to the market dynamics
affecting Xeris and/or Strongbridge following completion of the
Acquisition;
- that there will be no material change to exchange rates
following completion of the Acquisition;
- that Xeris will begin the process of realising potential
synergies promptly following completion of the
Acquisition;
- that Xeris will be able to leverage its existing commercial
infrastructure to support the potential launch of Recorlev, thus
eliminating the need for additional commercial capabilities that
Strongbridge had planned to build on its own; and
- that the transaction closes in Q4 2021 and synergies will begin
to be realized almost immediately, with the full impact assumed to
be realized in 2022.
- In establishing the estimate of pre-tax synergies and other
cost reductions the Xeris Board has assumed that Strongbridge's
operations, processes and procedures are comparable to those of
Xeris' related operations, except where publicly available
information clearly indicates otherwise or the due diligence
materials provided by Strongbridge to Xeris indicated
otherwise.
- In addition to information from Xeris' and Strongbridge's
respective management teams, the sources of information that Xeris
has used to arrive at the estimate of potential pre-tax synergies
and other cost reductions include:
- the Strongbridge annual report and accounts;
- Strongbridge's presentations to analysts;
- Strongbridge's website;
- analysts' research;
- other public information;
- Xeris' knowledge of the industry and of Strongbridge; and
- Xeris' managements' experience of synergies from previous
transactions.
- Xeris anticipates the cost to achieve expected synergies will
be approximately $14 million,
excluding transaction costs of approximately $19 million. Approximately $1 million of these costs are expected to be
incurred by the end of 2021, approximately an incremental
$11 million by the end of 2022 and
approximately an incremental $2
million by the end of 2023.
- There remains an inherent risk in the synergy forward-looking
statements. No synergy statement in this announcement, should be
construed as a profit forecast or interpreted to mean that Xeris
Biopharma Holdings' profits or earnings in the first full year
following the Acquisition, or in any subsequent period, would
necessarily match or be greater than or be less than those of Xeris
and/or Strongbridge for the relevant preceding financial period or
any other period.
APPENDIX II
DEFINITIONS
The following definitions apply throughout this announcement
unless the context otherwise requires:
"Acquisition", the proposed acquisition by Xeris
Biopharma Holdings of Strongbridge by means of the Scheme or the
Takeover Offer (and any such Scheme or Takeover Offer as it may be
revised, amended or extended from time to time) pursuant to this
Agreement (whether by way of the Scheme or the Takeover Offer)
(including the issuance by Xeris Biopharma Holdings of the
aggregate Share Consideration and CVR Consideration pursuant to the
Scheme or the Takeover Offer), as described in this announcement
and provided for in the Transaction Agreement;
"Act", the Irish Companies Act 2014, all enactments which
are to be read as one with, or construed or read together as one
with, the Act and every statutory modification and re-enactment
thereof for the time being in force;
"Acting in Concert" shall have the meaning given to that
term in the Takeover Panel Act, as amended;
"Antitrust Laws", the Sherman Act of 1890, the Clayton
Act of 1914, the Federal Trade Commission Act of 1914, the HSR Act
and all other federal, state and foreign applicable Laws in effect
from time to time that are designed or intended to prohibit,
restrict or regulate actions having the purpose or effect of
monopolization or restraint of trade.
"Business Day", any day, other than a Saturday, Sunday or
a day on which banks in Ireland or
in the State of New York are
authorised or required by law or executive order to be closed;
"CAM Capital", Caxton Alternative Management LP;
"Clearances" all consents, clearances, approvals,
permissions, permits, nonactions, orders and waivers to be obtained
from, and all registrations, applications, notices and filings to
be made with or provided to, any Relevant Authority or other third
party in connection with the implementation of the Merger, the
Scheme and/or the Acquisition.
"Concert Parties", such persons as are deemed to be
Acting in Concert with Xeris pursuant to Rule 3.3 of Part A of the
Irish Takeover Rules;
"Conditions", the conditions to the Scheme and the
Acquisition set out in paragraphs 1, 2, 3, 4 and 5 of Appendix III
of this announcement, and "Condition", any one of the
Conditions;
"Court Meeting", the meeting or meetings of the
Strongbridge Shareholders or, if applicable, the meeting or
meetings of any class or classes of Strongbridge Shareholders (and
in each case, any adjournment or postponement thereof) convened by
(i) resolution of the Strongbridge Board or (ii) order of the High
Court, in either case, pursuant to Section 450 of the Act to
consider and, if thought fit, approve the Scheme (with or without
amendment);
"Court Meeting Resolution", the resolution to be proposed
at the Court Meeting for the purposes of approving and implementing
the Scheme;
"Court Order", the order or orders of the High Court
sanctioning the Scheme under Section 453 of the Act and, if
applicable, confirming the reduction of capital that forms part of
it under Sections 84 and 85 of the Act;
"COVID-19", severe acute respiratory syndrome coronavirus
2 (SARS-CoV-2) or the disease it causes, known as coronavirus
disease 2019, and any and all additional strains, variations or
mutations thereof, or related or associated epidemics, pandemic or
disease outbreaks;
"CVR" shall have the meaning given to that term in clause
8.1(c)(i)(A) of the Transaction Agreement;
"CVR Agreement" shall have the meaning given to that term
in Clause 8.1(e) of the Transaction Agreement;
"CVR Consideration" shall have the meaning given to that
term in Clause 8.1(c)(i)(A) of the Transaction Agreement;
"EC Merger Regulation", the Council Regulation (EC) No
139/2004 of 20 January 2004 on the
control of concentrations between undertakings.
"Effective Date", the date on which the Scheme becomes
effective in accordance with its terms or, if the Acquisition is
implemented by way of a Takeover Offer, the date on which the
Takeover Offer has become (or has been declared) unconditional in
all respects in accordance with the provisions of the Takeover
Offer Documents and the Irish Takeover Rules;
"Effective Time", the time on the Effective Date at which
the Court Order and, if applicable, a copy of the minute required
by Section 86 of the Act are registered by the Registrar of
Companies or, if the Acquisition is implemented by way of a
Takeover Offer, the time on the Effective Date at which the
Takeover Offer becomes (or is declared) unconditional in all
respects in accordance with the provisions of the Takeover Offer
Documents and the Irish Takeover Rules;
"EGM", the extraordinary general meeting of the
Strongbridge Shareholders (and any adjournment or postponement
thereof) to be convened in connection with the Scheme, expected to
be convened as soon as the preceding Court Meeting shall have been
concluded (it being understood that if the Court Meeting is
adjourned or postponed, the EGM shall be correspondingly adjourned
or postponed);
"EGM Resolutions", collectively, the following
resolutions to be proposed at the EGM: (i) an ordinary resolution
to approve the Scheme and to authorize the Strongbridge Board to
take all such action as it considers necessary or appropriate to
implement the Scheme; (ii) if applicable, a special resolution to
cancel, subject to the approval of the High Court, the issued share
capital of Strongbridge (other than any Strongbridge Shares held by
any member of the Xeris Group); (iii) if applicable, an ordinary
resolution authorizing the Strongbridge Board to allot new ordinary
shares to Xeris Biopharma Holdings pursuant to this Agreement and
the Scheme by capitalization of the reserve arising from the
cancellation of the issued share capital of Strongbridge pursuant
to the resolution described in clause (ii); (iv) a special
resolution amending the Strongbridge Memorandum and Articles of
Association in accordance with Clause 4.6 (the resolutions
described in the foregoing clauses (i), (ii), (iii) and (iv), the
"Required EGM Resolutions"); (v) an ordinary resolution that
any motion by the Chairperson of the Strongbridge Board to adjourn
or postpone the EGM, or any adjournments or postponements thereof,
to another time and place if necessary or appropriate to solicit
additional proxies if there are insufficient votes at the time of
the EGM to approve the Scheme or any of the Required EGM
Resolutions to be approved; and (vi) any other resolutions as
Strongbridge reasonably determines to be necessary or desirable for
the purposes of implementing the Acquisition as have been approved
by Xeris (such approval not to be unreasonably withheld,
conditioned or delayed);
"End Date", the date that is nine months after the date
of the Transaction Agreement;
"Exchange Act", the United States Securities Exchange Act
of 1934, as amended;
"Expenses Reimbursement Agreement", the expenses
reimbursement agreement dated as of the date hereof and entered
into between Xeris and Strongbridge with the consent of the
Panel;
"FDA", United States Food and Drug Administration;
"FDCA", Federal Food, Drug, and Cosmetic Act of 1938, as
amended;
"Form S-4", the Form S-4 Registration Statement to be
filed with the SEC in connection with the Acquisition;
"Governmental Entity", (i) any Relevant Authority, (ii)
any company, business, enterprise, or other entity owned, in whole
or in part, or controlled by any Relevant Authority, or (iii) any
political party;
"High Court", the High Court of Ireland;
"HSR Act", the United States Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder;
"Independent Strongbridge Directors", all Strongbridge
Directors except Dr. Jeffrey W.
Sherman;
"Independent Xeris Directors", all Xeris Directors except
Dr. Jeffrey W. Sherman;
"Ireland", Ireland, excluding Northern Ireland, and the word "Irish"
shall be construed accordingly;
"Irish Takeover Rules", the Irish Takeover Panel
Act 1997 (as amended), Takeover Rules, 2013, as amended;
"Joint Proxy Statement" shall have the meaning given to
that term in Clause 3.7(a) of the Transaction Agreement;
"Law", any federal, state, local, foreign or
supranational law, statute, ordinance, rule, regulation, judgment,
order, injunction, decree, agency requirement, license or permit of
any Relevant Authority;
"Merger" shall have the meaning given to that term in
Clause 8.2(b) of the Transaction Agreement;
"Milestone" shall have the meaning given to that term in
the CVR Agreement;
"Milestone Payment" shall have the meaning given to that
term in the CVR Agreement;
"Milestone Payment Date" shall have the meaning
given to that term in the CVR Agreement;
"Nasdaq", the Nasdaq Global Select Market;
"NDA", a new drug application submitted to FDA under
Section 505 of the FDCA and 21 C.F.R. Part 314;
"Non-U.S. Plan" shall have the meaning given to
that term in Clause 6.1(i)(ix) of the Transaction Agreement;
"Panel", the Irish Takeover Panel;
"Person" or "person", an individual, group
(including a "group" under Section 13(d) of the Exchange Act),
corporation, partnership, limited liability company, joint venture,
association, trust, unincorporated organisation or other entity or
any Relevant Authority or any department, agency or political
subdivision thereof;
"Registrar of Companies", the Registrar of Companies in
Dublin, Ireland;
"Relevant Authority", any Irish, United States, foreign or supranational,
federal, state or local governmental commission, board, body,
division, political subdivision, bureau or other regulatory
authority, agency, including courts and other judicial bodies, or
any competition, antitrust or supervisory body, central bank,
public international organization or other governmental, trade or
regulatory agency or body, securities exchange or any
self-regulatory body or authority, including any instrumentality or
entity designed to act for or on behalf of the foregoing, in each
case, in any jurisdiction, including, for the avoidance of doubt,
the Panel, the High Court, and the SEC;
"Representatives", in relation to any person, the
directors, officers, employees, agents, investment bankers,
financial advisors, legal advisors, accountants, brokers, finders,
consultants or representatives of such person;
"Resolutions", the EGM Resolutions and the Court Meeting
Resolution, which will be set out in the Scheme Document;
"Restricted Jurisdictions", the jurisdictions in
which the release, publication or distribution of this announcement
may be restricted by the laws of those jurisdictions;
"Scheme", the proposed scheme of arrangement under
Chapter 1 of Part 9 of the Act and, if applicable, the capital
reduction under Sections 84 and 85 of the Act to effect the
Acquisition pursuant to this Agreement, on such terms and in such
form as is consistent with the terms agreed by Xeris, Xeris
Biopharma Holdings, Wells MergerSub and Strongbridge as set out in
this announcement and on such other terms as such parties mutually
agree in writing, including any revision of the scheme of
arrangement as may be agreed between such parties in writing and,
if required, by the High Court;
"Scheme Document", a document (or the relevant sections
of the Joint Proxy Statement comprising the scheme document)
(including any amendments or supplements thereto) to be distributed
to Strongbridge Shareholders and, for information only, to
Strongbridge Equity Award Holders, Strongbridge Warrant Holders and
the Strongbridge Convertible Holder containing (i) the Scheme, (ii)
the notice or notices of the Court Meeting and EGM, (iii) an
explanatory statement as required by Section 452 of the Act with
respect to the Scheme, (iv) such other information as may be
required or necessary pursuant to the Act and the Irish Takeover
Rules and (v) such other information as Strongbridge and Xeris
shall agree;
"SEC", the United States Securities and Exchange
Commission;
"Securities Act", the United States Securities Act of
1933, as amended;
"Share Consideration" shall have the meaning given to
that term in Clause 8.1(c)(i)(B) of the Transaction Agreement;
"Specified Jurisdiction", any jurisdiction in which
Xeris, Strongbridge or any of their Affiliates operate their
respective businesses or own any assets;
"Strongbridge", Strongbridge Biopharma plc, a company
incorporated in Ireland;
"Strongbridge Alternative Proposal", any bona fide
proposal or bona fide offer made by any person (other than a
proposal or offer by Xeris or any of its Concert Parties or any
person Acting in Concert with Xeris) for (i) the acquisition of
Strongbridge by scheme of arrangement, takeover offer or business
combination transaction; (ii) the acquisition by any person of 20%
or more of the assets of Strongbridge and its Subsidiaries, taken
as a whole, measured by either book value or fair market value
(including equity securities of Strongbridge's Subsidiaries); (iii)
the acquisition by any person (or the stockholders of any person)
of 20% or more of the outstanding Strongbridge Shares; or (iv) any
merger, business combination, consolidation, share exchange,
recapitalisation or similar transaction involving Strongbridge as a
result of which the holders of Strongbridge Shares immediately
prior to such transaction do not, in the aggregate, own at least
80% of the outstanding voting power of the surviving or resulting
entity in such transaction immediately after consummation
thereof;
"Strongbridge Board", the board of directors of
Strongbridge;
"Strongbridge Change of Recommendation", shall have the
meaning given to that term in Section 5.3(c)(i) of the Transaction
Agreement;
"Strongbridge Convertible Holder", Avenue Venture
Opportunity Fund L.P.;
"Strongbridge Convertibles"; the right of the
Strongbridge Convertible Holder to convert up to $3,000,000 of the aggregate principal amount
outstanding under the Strongbridge Loan Agreement into Strongbridge
Shares;
"Strongbridge Directors", the members of the board of
directors of Strongbridge;
"Strongbridge Equity Award Holders", the holders of
Strongbridge Options and/or Strongbridge Share Awards;
"Strongbridge Group", Strongbridge and all of its
Subsidiaries;
"Strongbridge Loan Agreement"; the term loan agreement,
dated May 19, 2020, by Strongbridge,
along with Strongbridge U.S. Inc., Cortendo AB (publ) and
Strongbridge Dublin Limited, Avenue Venture Opportunity Fund L.P.,
as administrative agent and collateral agent, and the lenders named
therein;
"Strongbridge Meetings", the Court Meeting and the
EGM;
"Strongbridge Memorandum and Articles of Association"
shall have the meaning given to that term in Clause 6.1(a)(i) of
the Transaction Document;
"Strongbridge Option", an option to purchase Strongbridge
Shares;
"Strongbridge Rollover Option" shall have the meaning
given to that term in Clause 4.1 of the Transaction Agreement;
"Strongbridge Share Award", an award denominated in
Strongbridge Shares, other than a Strongbridge Option;
"Strongbridge Shareholder Approval", (i) the approval of
the Scheme by a majority in number of the members of each class of
Strongbridge Shareholders (including as may be directed by the High
Court pursuant to Section 450(5) of the Act) representing, at the
relevant voting time, at least seventy five per cent (75%) in value
of the Strongbridge Shares of that class held by such Strongbridge
Shareholders present and voting either in person or by proxy, at
the Court Meeting (or at any adjournment or postponement of such
meeting) and (ii) each of the Required EGM Resolutions being duly
passed by the requisite majorities of Strongbridge Shareholders at
the EGM (or at any adjournment or postponement of such
meeting);
"Strongbridge Shareholders", the holders of Strongbridge
Shares;
"Strongbridge Shares", the ordinary shares of
$0.01 each in the capital of
Strongbridge;
"Strongbridge Warrant Holders", the holders of the
Strongbridge Warrants;
"Strongbridge Warrants", the following warrants issued by
Strongbridge: (i) the warrants issued on December 22, 2016, in connection with a private
placement of Strongbridge Shares, under which 5,030,000
Strongbridge Shares were issuable (the "Strongbridge
Private Placement Warrants"); (ii) the warrants issued on
December 28, 2016, in connection with
Horizon and Oxford loan agreement, under which 160,714 Strongbridge
Shares were issuable; (iii) the warrants issued on January 16, 2018, to CR Group lenders, under
which 1,248,250 Strongbridge Shares were issuable; (iv) the
warrants issued on July 14, 2017, to
CR Group lenders, under which 394,289 Strongbridge Shares were
issuable; (v) the warrant issued on May 19,
2020, to Avenue Venture Opportunities Fund, L.P., under
which 267,390 Strongbridge Shares were issuable; and (vi) the
warrant issued on December 30, 2020,
to Avenue Venture Opportunities Fund, L.P., under which 267,390
Strongbridge Shares were issuable, in each case as of the
Strongbridge Capitalisation Date (the warrants in clauses (iii)
through (vi) collectively, the "Strongbridge Assumed
Warrants");
"Subsidiary", in relation to any person, any corporation,
partnership, association, trust or other form of legal entity of
which such person directly or indirectly owns securities or other
equity interests representing more than 50% of the aggregate voting
power (provided that Xeris Biopharma Holdings and Wells MergerSub
shall be deemed to be Subsidiaries of Xeris for purposes of this
announcement);
"Takeover Offer", an offer in accordance with Clause 3.6
of the Transaction Agreement for the entire issued share capital of
Strongbridge (other than any Strongbridge Shares beneficially owned
by Xeris or any member of the Xeris Group (if any)) including any
amendment or revision thereto pursuant to this Agreement, the full
terms of which would be set out in the Takeover Offer Document or
as the case may be, any revised offer documents;
"Takeover Offer Document", if following the date of this
announcement, Xeris elects to implement the Acquisition by way of
the Takeover Offer in accordance with Clause 3.6 of the Transaction
Agreement, the document to be despatched to Strongbridge
Shareholders and others by Xeris Biopharma Holdings containing,
amongst other things, the Takeover Offer, the Conditions (save as
Xeris determines not to be appropriate in the case of a Takeover
Offer) and certain information about Xeris Biopharma Holdings,
Xeris and Strongbridge and, where the context so admits, includes
any form of acceptance, election, notice or other document
reasonably required in connection with the Takeover Offer;
"Takeover Panel Act", the Irish Takeover Panel Act 1997
(as amended);
"Transaction", the proposed acquisition by Xeris
Biopharma Holdings of Strongbridge by means of the Scheme or the
Takeover Offer (and any such Scheme or Takeover Offer as it may be
revised, amended or extended from time to time) pursuant to this
Agreement (whether by way of the Scheme or the Takeover Offer)
(including the issuance by Xeris Biopharma Holdings of the
aggregate Share Consideration and CVR Consideration pursuant to the
Scheme or the Takeover Offer), as described in this announcement
and provided for in the Transaction Agreement;
"Transaction Agreement", the Transaction Agreement dated
May 24, 2021 by and among Xeris,
Xeris Biopharma Holdings, Wells MergerSub and
Strongbridge;
"U.S." or "United
States", the United States of
America, its territories and possessions, any State of the United States and the
District of Columbia, and all
other areas subject to its jurisdiction;
"US$", "$" or "U.S. dollars",
United States dollars, the lawful
currency of the United States;
"Wells MergerSub", Wells MergerSub, Inc., a corporation
incorporated in the State of
Delaware;
"Xeris", Xeris Pharmaceuticals, Inc., a corporation
incorporated in the State of
Delaware;
"Xeris Biopharma Holdings", Xeris Biopharma Holdings,
Inc., a corporation incorporated in the State of Delaware;
"Xeris Biopharma Holdings Shares", the shares of common
stock, par value $0.0001 per share,
of Xeris Biopharma Holdings;
"Xeris Board", the board of directors of Xeris;
"Xeris Directors", the members of the board of directors
of Xeris;
"Xeris Group", Xeris and all of its Subsidiaries;
"Xeris Shareholder Approval" shall have the meaning given
to that term in Clause 6.2(s) of the Transaction Agreement;
"Xeris Shareholder Meeting", the meeting of Xeris
Shareholders held for the purpose of obtaining the Xeris
Shareholder Approval;
"Xeris Shareholders", the holders of Xeris Shares;
and
"Xeris Shares", the shares of common stock, par value
$0.0001 per share, of Xeris.
References to any applicable Law shall be deemed to refer to
such applicable Law as amended from time to time and to any rules
or regulations promulgated thereunder.
Any singular term shall be deemed to include the plural, and any
plural term the singular, and references to any gender shall
include all genders.
APPENDIX III
CONDITIONS OF THE ACQUISITION AND THE SCHEME
The Acquisition and the Scheme will comply with the Takeover
Rules, the Act and, where relevant, the rules and regulations of
the Exchange Act and Nasdaq, and are subject to the terms and
conditions set out in this announcement and to be set out in the
Scheme Document. The Acquisition and the Scheme are, to the extent
required by the Law of Ireland,
governed by the Law of Ireland.
The Acquisition and the Scheme will be subject to the following
conditions:
- The Acquisition will be conditional upon the Scheme becoming
effective and unconditional by not later than the End Date (or such
earlier date as may be specified by the Panel, or such later date
as Xeris and Strongbridge may, subject to receiving the consent of
the Panel and the High Court, in each case if required, agree),
provided that any Party whose willful and material breach of any
provision of the Transaction Agreement shall have prevented this
condition from being satisfied shall be deemed to have waived this
condition.
- The Scheme will be conditional upon:
- the approval of the Scheme by a majority in number of the
members of each class of Strongbridge Shareholders (including as
may be directed by the High Court pursuant to section 450(5) of the
Act) representing, at the Voting Record Time, at least seventy five
per cent (75%) in value of the Strongbridge Shares of that class
held by such Strongbridge Shareholders present and voting either in
person or by proxy at the Court Meeting (or any adjournment or
postponement thereof);
- each of the Required EGM Resolutions being duly passed by the
requisite majority of Strongbridge Shareholders at the EGM (or at
any adjournment of such meeting);
- the sanction by the High Court (without material modification)
of the Scheme pursuant to Sections 449 to 455 of the Act and, if
applicable, the confirmation of the reduction of capital involved
therein by the High Court (the date on which the condition in this
paragraph 2(c) is satisfied, the "Sanction Date");
and
- office copies of the Court Order and, if applicable, the minute
required by Section 86 of the Act in respect of the reduction of
capital (referred to in paragraph 2(c)) being delivered for
registration to the Registrar of Companies, and registration of the
Court Order and, if applicable, such minute by the Registrar of
Companies.
- The Xeris Parties and Strongbridge have agreed that, subject to
paragraph 6 of this Appendix III, the Acquisition
will also be conditional upon the following matters having been
satisfied or waived on or before the Sanction Date:
- the Xeris Shareholder Approval shall have been obtained;
- Nasdaq having approved, and not withdrawn such approval, the
listing of all of the Holdco Shares to be issued in the Scheme,
subject only to official notice of issuance;
- the applicable waiting periods under the HSR Act in connection
with the Acquisition and/or the Merger, if any, shall have expired
or been terminated;
- to the extent that the Acquisition constitutes a concentration
within the scope of Council Regulation (EC) No. 139/2004 (the "EC
Merger Regulation") or otherwise constitutes a concentration that
is subject to the EC Merger Regulation, the European Commission
having decided to allow closing of the Acquisition;
- the extent that all or part of the Acquisition is referred by
the European Commission to the Relevant Authority of one or more
member countries of the European Economic Area, such Relevant
Authority(ies) (in the case of a partial referral in conjunction
with a final decision of the European Commission) having issued a
final decision or decisions which satisfies (or together satisfy)
Condition 3(d)(i) above (that clause being interpreted mutandis
mutatis);
- all required Clearances of any Governmental Entity under the
Antitrust Laws of each Specified Jurisdiction, if any, shall have
been obtained and remain in full force and effect and all
applicable waiting periods shall have expired, lapsed or been
terminated (as appropriate), in each case in connection with the
Acquisition and/or the Merger;
- the Form S-4 shall have become effective under the Securities
Act and shall not be the subject of any stop order or proceedings
initiated by the United States Securities and Exchange Commission
seeking any stop order;
- no (i) Law (other than an order, writ, decree, judgment,
injunction, restraint or prohibition described in clause (ii)),
(ii) order, writ, decree, judgment, injunction, restraint or
prohibition by any court of competent jurisdiction or (iii) order,
writ, decree, judgment, injunction, restraint or prohibition under
any Antitrust Law of a Specified Jurisdiction by any Relevant
Authority which restrains, enjoins, makes illegal or otherwise
prohibits consummation of the Acquisition or the Merger shall have
been issued, made, enacted or entered and shall continue to be in
effect; and
- the Transaction Agreement shall not have been terminated in
accordance with its terms by the applicable Party or Parties as set
forth below as a consequence of an event set forth below (such
events being the events set out in the Transaction Agreement
following the occurrence of which the Transaction Agreement may be
terminated in accordance with its terms):
- by either Strongbridge or Xeris, if:
- the Court Meeting or the EGM shall have been completed and the
Court Meeting Resolution or the EGM Resolutions, as applicable,
shall not have been approved by the requisite majorities; or
- the Xeris Shareholders Meeting shall have been completed and
the Xeris Shareholder Approval shall not have been obtained;
- by either Strongbridge or Xeris, if the Effective Time shall
not have occurred by 5:00 p.m.,
New York City time, on the End
Date, provided that the right to terminate the Transaction
Agreement pursuant to Clause 9.1(a)(ii) of the Transaction
Agreement shall not be available to a Party whose willful and
material breach of any provision of the Transaction Agreement shall
have caused the failure of the Effective Time to have occurred by
such time;
- by either Strongbridge or Xeris, if the High Court declines or
refuses to sanction the Scheme, unless both Parties agree in
writing that the decision of the High Court shall be appealed (it
being agreed that Strongbridge shall make such an appeal if
requested to do so in writing by Xeris and the counsel appointed by
Strongbridge and by Xeris agree that doing so is a reasonable
course of action);
- by either Strongbridge or Xeris if (A) there shall be any Law
(other than an order, writ, decree, judgment, injunction or action
described in clause (B), whether or not final or nonappealable)
enacted after the date of the Transaction Agreement and remaining
in effect that makes the Acquisition illegal or that prohibits the
consummation of the Acquisition, or (B) any court of competent
jurisdiction or other Governmental Entity shall have issued a final
and nonappealable order, writ, decree, judgment or injunction, or
shall have taken any other action, in either case of clauses (A)
and (B), permanently restraining, enjoining or otherwise
prohibiting the Acquisition and such order, writ, decree, judgment
or injunction, or other action shall have become final and
nonappealable; provided that the right to terminate the Transaction
Agreement pursuant to Clause 9.1(a)(iv) of the Transaction
Agreement shall not be available to any Party whose willful and
material breach of any provision of the Transaction Agreement shall
have been the primary cause of such Law, order, writ, decree,
judgment or injunction;
- by Strongbridge, if any Xeris Party shall have breached or
failed to perform in any material respect any of its covenants or
other agreements contained in the Transaction Agreement or if any
of its representations or warranties set forth in the Transaction
Agreement are inaccurate, which breach, failure to perform or
inaccuracy (A) would result in a failure of Conditions 1, 2, 3 or
5, and (B) is not reasonably capable of being cured by the End Date
or, if curable, Strongbridge shall have given Xeris written notice,
delivered at least thirty (30) days prior to such termination,
stating Strongbridge's intention to terminate the Transaction
Agreement pursuant to Clause 9.1(a)(v) of the Transaction Agreement
and the basis for such termination and such breach, failure to
perform or inaccuracy shall not have been cured within thirty (30)
days following the delivery of such written notice;
- by Xeris, if Strongbridge shall have breached or failed to
perform in any material respect any of its covenants or other
agreements contained in the Transaction Agreement or if any of its
representations or warranties set forth in the Transaction
Agreement are inaccurate, which breach, failure to perform or
inaccuracy (A) would result in a failure of a Condition set forth
in Conditions 1, 2, 3 or 4 and (B) is not reasonably capable of
being cured by the End Date or, if curable, Xeris shall have given
Strongbridge written notice, delivered at least thirty (30) days
prior to such termination, stating Xeris's intention to terminate
the Transaction Agreement pursuant to Clause 9.1(a)(vi) of the
Transaction Agreement and the basis for such termination and such
breach, failure to perform or inaccuracy shall not have been cured
within thirty (30) days following the delivery of such written
notice;
- by Strongbridge, prior to receipt of the Xeris Shareholder
Approval, if (A) the Xeris Board shall have effected a Xeris Change
of Recommendation or (B) Xeris shall have materially breached
Clause 5.4 of the Transaction Agreement;
- by Xeris, prior to the receipt of the Strongbridge Shareholder
Approval, if (A) the Strongbridge Board shall have effected a
Strongbridge Change of Recommendation or (B) Strongbridge shall
have materially breached Clause 5.3 of the Transaction Agreement;
or
- by mutual written consent of Strongbridge and Xeris.
- The Xeris Parties and Strongbridge have agreed that, subject to
paragraph 6 of this Appendix III, the Xeris Parties'
obligation to effect the Acquisition will also be conditional upon
the following matters having been satisfied (or, to the extent
permitted by Applicable Law, waived by Xeris) on or before the
Sanction Date:
- (i) the representations and warranties of Strongbridge set
forth in Clauses 6.1(b)(i) (Capital) and 6.1(b)(ii)
(Capital) (to the extent relating to shares in the capital
of Strongbridge) of the Transaction Agreement shall be true and
correct, except for any de minimis inaccuracies at and as of the
date of the Transaction Agreement and at and as of the Sanction
Date as though made at and as of the Sanction Date (or, if such
representations and warranties are given as of another specific
date, at and as of such date),
(ii) the representations and warranties of Strongbridge set
forth in Clauses 6.1(a) (Qualification, Organisation,
Subsidiaries, etc.), 6.1(c)(i) (Corporate Authority Relative
to this Agreement), 6.1(c)(iii)(B) (No Violation of
Organizational Documents), 6.1(v) (Finders or Brokers)
and 6.1(x) (Takeover Statutes) of the Transaction Agreement
shall be true and correct in all material respects at and as of the
date of the Transaction Agreement and at and as of the Sanction
Date as though made at and as of the Sanction Date (or, if such
representations and warranties are given as of another specific
date, at and as of such date),
(iii) the representations and warranties of Strongbridge set
forth in the second sentence of Clause 6.1(j) (Absence of
Certain Changes or Events) of the Transaction Agreement shall
be true and correct in all respects at and as of the date of the
Transaction Agreement and at and as of the Sanction Date as though
made at and as of the Sanction Date, and
(iv) the representations and warranties of Strongbridge set
forth in the Transaction Agreement (other than the representations
and warranties referred to in clauses (i) through (iii) of
this paragraph 4(a)) (disregarding all qualifications and
exceptions contained therein relating to materiality or
Strongbridge Material Adverse Effect) shall be true and correct at
and as of the date of the Transaction Agreement and at and as of
the Sanction Date as though made at and as of the Sanction Date
(or, if such representations and warranties are given as of another
specific date, at and as of such date), except, in the case of this
clause (iv) only, where the failure of such representations
and warranties to be true and correct has not had and would not
reasonably be expected to have, individually or in the aggregate, a
Strongbridge Material Adverse Effect;
- Strongbridge shall have in all material respects performed all
obligations and complied with all covenants and agreements required
by the Transaction Agreement to be performed or complied with by it
prior to the Sanction Date; and
- Strongbridge shall have delivered to Xeris a certificate, dated
as of the Sanction Date and signed by an executive officer of
Strongbridge, certifying on behalf of Strongbridge to the effect
that the conditions set forth in paragraphs 4(a) and
4(b) have been satisfied.
- The Xeris Parties and Strongbridge have agreed that, subject to
paragraph 6 of this Appendix III, Strongbridge's
obligation to effect the Acquisition will also be conditional upon
the following matters having been satisfied (or, to the extent
permitted by Applicable Law, waived by Strongbridge) on or before
the Sanction Date:
- (i) the representations and warranties of Xeris set forth
in Clauses 6.2(a)(ii)(B) (Qualification, Organization,
Subsidiaries, etc.), 6.2(b)(i) (Capital Stock) and
6.2(b)(ii) (Capital) (to the extent relating to the capital
stock of Xeris) of the Transaction Agreement which are identified
in Annex B, Schedule 2, Section A shall be true and
correct, except for any de minimis inaccuracies at and as of
the date of the Transaction Agreement and at and as of the Sanction
Date as though made at and as of the Sanction Date (or, if such
representations and warranties are given as of another specific
date, at and as of such date),
(ii) the representations and warranties of Xeris set forth in
Clauses 6.2(a) (Qualification Organisation, Subsidiaries,
etc.) (other than 6.2(a)(ii)(B)), 6.2(c)(i) (Corporate
Authority Relative to this Agreement), 6.2(c)(iii)(B) (No
Violation of Organisational Documents), 6.2(v) (Finders or
Brokers) and 6.2(x) (Takeover Statutes) of the
Transaction Agreement shall be true and correct in all material
respects at and as of the date of the Transaction Agreement and at
and as of the Sanction Date as though made at and as of the
Sanction Date (or, if such representations and warranties are given
as of another specific date, at and as of such date),
(iii) the representations and warranties of Xeris set forth
in the second sentence of Clause 6.2(j) (Absence of Certain
Changes or Events) of the Transaction Agreement shall be true
and correct in all respects at and as of the date of the
Transaction Agreement and at and as of the Sanction Date as though
made at and as of the Sanction Date, and
(iv) the representations and warranties of Xeris set forth in
the Transaction Agreement (other than the representations and
warranties referred to in clauses (i) through (iii) of this
Paragraph 5(a)) (disregarding all qualifications and
exceptions contained therein relating to materiality or Xeris
Material Adverse Effect) shall be true and correct at and as of the
date of the Transaction Agreement and at and as of the Sanction
Date as though made at and as of the Sanction Date (or, if such
representations and warranties are given as of another specific
date, at and as of such date), except, in the case of this
clause (iv) only, where the failure of such representations
and warranties to be true and correct has not had, and would not
reasonably be expected to have, individually or in the aggregate, a
Xeris Material Adverse Effect;
- the Xeris Parties shall have in all material respects performed
all obligations and complied with all covenants and agreements
required by the Transaction Agreement to be performed or complied
with by them prior to the Sanction Date; and
- Xeris shall have delivered to Strongbridge a certificate, dated
as of the Sanction Date and signed by an executive officer of
Xeris, certifying on behalf of the Xeris Parties to the effect that
the conditions set forth in paragraphs 5(a) and
5(b) have been satisfied.
- 6. Subject to the requirements of the Panel:
- Xeris and Strongbridge reserve the right (but neither party
shall be under any obligation) to waive (to the extent permitted by
Applicable Law), in whole or in part, all or any of the conditions
in paragraph 3 (provided that no such waiver shall be
effective unless agreed to by both parties);
- Xeris reserves the right (but shall be under no obligation) to
waive (to the extent permitted by Applicable Law), in whole or in
part, all or any of the conditions in paragraph 4; and
- Strongbridge reserves the right (but shall be under no
obligation) to waive (to the extent permitted by Applicable Law),
in whole or in part, all or any of the conditions in
paragraph 5.
- The Scheme will lapse unless it is effective on or prior to the
End Date (or such later date as Strongbridge and Xeris may, subject
to receiving the consent of the Panel and the High Court, in each
case if required, agree), provided that any Party whose willful and
material breach of any provision of the Transaction Agreement shall
have prevented this condition from being satisfied shall be deemed
to have waived this condition.
- If Xeris is required to make an offer for Strongbridge Shares
under the provisions of Rule 9 of the Takeover Rules, Xeris may
make such alterations to any of the conditions set out in
paragraphs 1, 2, 3, 4 and 5 above as are necessary
to comply with the provisions of that rule.
- Xeris reserves the right, subject to the prior written approval
of the Panel, to effect the Acquisition by way of a Takeover Offer
in the circumstances described in and subject to the terms of
Clause 3.6 of the Transaction Agreement. Without limiting Clause
3.6 of the Transaction Agreement, in such event, such offer will be
implemented on terms and conditions that are at least as favourable
to the Strongbridge Shareholders and the Strongbridge Equity Award
Holders as those which would apply in relation to the Scheme
(except for an acceptance condition set at 80 per cent of the
nominal value of the Strongbridge Shares to which such an offer
relates and which are not already in the beneficial ownership of
Xeris so far as applicable).
- As required by Rule 12(b)(i) of the Takeover Rules, to the
extent that the Acquisition would give rise to a concentration with
a Community dimension within the scope of the EC Merger Regulation,
the Scheme shall, except as otherwise approved by the Panel, lapse
if the European Commission initiates proceedings in respect of that
concentration under Article 6(1)(c) of the EC Merger Regulation or
refers the concentration to a competent authority of a Member
State under Article 9(1) of the EC Merger Regulation prior to the
date of the Court Meeting.
For the purpose of these conditions, capitalized terms shall
have the meanings set forth in Appendix II to this announcement, as
set forth above in these conditions.
APPENDIX IV
REPORT OF KPMG PURSUANT TO RULE 19.3(B)(II) OF THE IRISH TAKEOVER
RULES
The Directors
Xeris Pharmaceuticals, Inc.
180 North LaSalle Street
Suite 1600
Chicago, IL 60601
USA
SVB Leerink LLC
227 W. Trade Street, Suite 2050
Charlotte, NC 28202
USA
24 May 2021
Dear Sir or Madam:
Report on Merger Benefit statement
We refer to the Merger Benefit Statement (the 'Statement') made
by the directors of Xeris Pharmaceuticals, Inc. (the 'Company')
(the 'Directors') in Section 9 of the Rule 2.5 Announcement dated
24 May 2021 (the 'Announcement').
The Statement has been made in the context of the disclosures in
Appendix I to the Announcement setting out, inter alia, the basis
of the Directors' belief (including sources of information)
supporting the Statement and their analysis and explanation of the
underlying constituent elements.
This report is required by Rule 19.3(b)(ii) of the Irish
Takeover Panel Act 1997, Takeover Rules, 2013 (the 'Rules') and is
given for the purpose of complying with that requirement and for no
other purpose.
Responsibility
It is the responsibility of the Directors to prepare the
Statement in accordance with the Rules. It is our
responsibility to form an opinion, as required by Rule 19.3(b)(ii)
of the Rules as to whether the Statement has been made with due
care and consideration.
Save for any responsibility which we may have to those persons
to whom this report is expressly addressed, and for any
responsibility arising under Rule 19.3(b)(ii) of the Rules to any
person as and to the extent therein provided, to the fullest extent
permitted by law we do not assume any responsibility and will not
accept any liability to any other person for any loss suffered by
any such other person as a result of, arising out of, or in
connection with this report or our statement, required by and given
solely for the purposes of complying with Rule 19.3(b)(ii) of the
Rules, consenting to its inclusion in Announcement.
Basis of preparation of the Statement
The Statement has been prepared on the basis stated in Appendix
I to the Announcement.
Basis of opinion
We have discussed the Statement, together with the relevant
bases of belief (including sources of information and assumptions),
with the Directors and SVB Leerink LLC. We have also
considered the letter dated 24 May
2021 from SVB Leerink LLC to the Directors on the same
matter. Our work did not involve any independent examination of any
of the financial or other information underlying the
Statement.
We conducted our work in accordance with Standards for
Investment Reporting issued by the Auditing Practices Board of the
United Kingdom and Ireland.
Our work has not been carried out in accordance with auditing or
other standards and practices generally accepted in the United States of America or other
jurisdictions and accordingly should not be relied upon as if it
had been carried out in accordance with those standards and
practices.
We do not express any opinion as to the achievability of the
benefits identified by the Directors in the Statement. Since
the Statement and the assumptions on which it is based relate to
the future and may therefore be affected by unforeseen events, we
can express no opinion on whether the actual benefits achieved will
correspond to those anticipated in the Statement, and the
differences may be material.
Opinion
On the basis of the foregoing, we report that in our opinion,
the Directors have made the Statement, in the form and context in
which it is made, with due care and consideration.
Yours faithfully
KPMG
Chartered Accountants
Dublin, Ireland
APPENDIX V
REPORT OF SVB LEERINK LLC PURSUANT TO RULE 19.3(B)(II) OF THE IRISH
TAKEOVER RULES
24 May 2021
The Directors
Xeris Pharmaceuticals, Inc.
180 N. LaSalle Street, Suite 1600
Chicago, IL 60601
Dear Xeris Directors,
Proposed acquisition of Strongbridge Pharmaceuticals plc
("Strongbridge") by Xeris Pharmaceuticals, Inc. ("Xeris")
We refer to the statements of estimated cost synergies, the
bases of preparation thereof and the notes thereto (together the
"Statements") made by Xeris set out in this announcement dated
24 May 2021, for which the directors
of Xeris are solely responsible.
We have discussed the Statements (including the assumptions and
sources of information referred to therein) with the independent
directors of Xeris (being all those directors with the exception of
Dr. Jeffrey Sherman) and those
officers and employees of Xeris who have developed the underlying
plans.
The Statements are subject to uncertainty as described in this
document and our work did not involve any independent examination
of any of the financial or other information underlying the
Statements.
We have relied upon the accuracy and completeness of all of the
financial and other information discussed or reviewed by us, and we
have assumed such accuracy and completeness for the purposes of
rendering this letter. In providing the confirmation set out
herein, we have reviewed the work carried out by KPMG and have
discussed with them the conclusions stated in their report dated
24 May 2021 addressed to yourselves
in this matter.
We do not express any opinion whatsoever as to the achievability
of the merger benefits identified by Xeris in the Statements.
This letter is provided solely to the directors of Xeris in
connection with Rule 19.3(b)(ii) of the Irish Takeover Panel Act
1997, Takeover Rules 2013 and for no other purpose. We accept no
responsibility to Strongbridge or its or Xeris' shareholders or any
other person, other than the directors of Xeris in respect of the
contents of, or any matter arising out of or in connection with,
this letter or the work undertaken in connection with this
letter.
On the basis of the foregoing, we consider that the Statements,
for which the directors of Xeris are solely responsible, have been
made with due care and consideration in the form and context in
which they are made.
Regards,
Byron T. Webster
Authorised Signatory
For and on behalf of
SVB Leerink LLC
APPENDIX VI
THE TRANSACTION AGREEMENT
This document can be found at
https://xerisstrongbridge.com/wp-content/uploads/2021/05/Transaction-Agreement.pdf.
APPENDIX VII
THE CVR AGREEMENT
This document can be found at:
https://xerisstrongbridge.com/wp-content/uploads/2021/05/CVR-Agreement.pdf.
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SOURCE Xeris Pharmaceuticals, Inc.