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MarketScreener Homepage  >  Equities  >  Nasdaq  >  Alexion Pharmaceuticals    ALXN

ALEXION PHARMACEUTICALS

(ALXN)
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ALEXION PHARMACEUTICALS, INC. : Entry into a Material Definitive Agreement, Other Events, Financial Statements and Exhibits (form 8-K)

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10/16/2019 | 08:53am EST

Item 1.01 Entry into a Material Definitive Agreement.

Agreement and Plan of Merger

On October 15, 2019, Alexion Pharmaceuticals, Inc., a Delaware corporation ("Alexion"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with Beagle Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Alexion ("Merger Subsidiary"), and Achillion Pharmaceuticals, Inc., a Delaware corporation ("Achillion"), pursuant to which, among other things, upon the terms and subject to the conditions thereof, Merger Subsidiary will merge with and into Achillion, with Achillion surviving as a wholly owned subsidiary of Alexion (the "Merger"). The board of directors of Achillion has approved the Merger Agreement and agreed to recommend that Achillion's stockholders adopt the Merger Agreement.

In the Merger, each share of Achillion common stock (a "Share") issued and outstanding immediately prior to the effective time (the "Effective Time") of the Merger (other than certain excluded shares as described in the Merger Agreement) will automatically be converted into the right to receive (1) $6.30 in cash, without interest (the "Cash Merger Consideration"), and (2) one contractual contingent value right pursuant to the CVR Agreement (as defined and described below, a "CVR").

Completion of the Merger is subject to various closing customary conditions, including the adoption of the Merger Agreement by a majority of the holders of the outstanding Shares; the absence of any order or other action issued by a governmental authority restraining, enjoining or otherwise prohibiting the consummation of the Merger and no law having been adopted that makes consummation of the Merger illegal or otherwise prohibited; the expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the approval of the Merger under the antitrust laws of other specified jurisdictions; and the absence of certain instituted, pending or threatened litigation or other proceedings.

The Merger Agreement includes representations, warranties and covenants of the parties customary for a transaction of this nature. Among other things, until the earlier of the termination of the Merger Agreement or the Effective Time, Achillion has agreed to operate its business in the ordinary course consistent with past practice and has agreed to certain other operating covenants, as set forth fully in the Merger Agreement. The Merger Agreement also prohibits Achillion's solicitation of proposals relating to alternative transactions and restricts Achillion's ability to furnish information to, or participate in any discussions or negotiations with, any third party with respect to any such transaction, subject to certain limited exceptions.

Either Achillion or Alexion may terminate the Merger Agreement in certain circumstances, including if (1) the Merger is not completed by April 15, 2020, subject to extension by Alexion in certain circumstances in the event that antitrust approval is not obtained (the "End Date"), (2) a governmental authority of competent jurisdiction has issued a final non-appealable order prohibiting the Merger or any applicable law makes consummation of the Merger illegal, (3) Achillion's stockholders fail to adopt the Merger Agreement, (4) the other party breaches its representations, warranties or covenants in the Merger Agreement in a way that would entitle the party seeking to terminate the Merger Agreement not to consummate the Merger, subject to the right of the breaching party to cure the breach, (5) subject to compliance with specified process and notice requirements, Achillion terminates the Merger Agreement in order to enter into an agreement providing for a "Superior Proposal" (as such term is defined in the Merger Agreement), or (6) Achillion's board of directors has changed its recommendation in favor of the Merger. In the event of a termination of the Merger Agreement under certain specified circumstances, including termination by Achillion to enter into an agreement providing for a Superior Proposal, or a termination by Alexion following a change in recommendation by Achillion's board of directors, Achillion may be required to pay Alexion a termination fee equal to $20,000,000. In the event of a termination of the Merger Agreement under certain specified circumstances, including failure to complete the merger by April 15, 2020 (or such later date as extended by Alexion) if, at the time of such termination, any necessary antitrust approval has not been obtained, or a final non-appealable order prohibiting the Merger by a governmental authority of competent jurisdiction, Alexion may be required to pay Achillion a termination fee equal to (i) $30,000,000 if the Merger Agreement is terminated prior to April 15, 2020, (ii) $40,000,000 if Alexion has extended the End Date and the Merger Agreement is terminated after April 15, 2020 but on or prior to the July 15, 2020, (iii) $50,000,000 if Alexion has extended the End Date twice and the Merger Agreement is terminated after July 15, 2020 but on or prior to October 15, 2020 or (iv) $60,000,000 if Alexion has extended the End Date three times and the Merger Agreement is terminated after October 15, 2020.

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Alexion intends to fund the acquisition of Achillion through cash on hand.

Contingent Value Rights Agreement

At or prior to the Effective Time, Alexion and a rights agent mutually acceptable to Alexion and Achillion will enter into a Contingent Value Rights Agreement in the form attached to the Merger Agreement as Exhibit B (the "CVR Agreement"), which will govern the terms of the CVRs to be received by Achillion's stockholders. The CVRs are not transferable except under certain limited circumstances, will not be evidenced by a certificate or other instrument and will not be registered or listed for trading. The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Alexion, Merger Subsidiary, Achillion or any of their affiliates.

Each CVR represents the right to receive (1) $1.00 upon the achievement of a Clinical Trial Milestone (as defined in the CVR Agreement) relating to the development of Achillion's product candidate ACH-5528 prior to the fourth anniversary of the consummation of the Merger and (2) $1.00 upon Alexion's first receipt of approval by the FDA of a new drug application or other regulatory approval application which approval grants Alexion the right to market and sell Achillion's product candidate ACH-4471 in the United States prior to the date that is fifty-four months after the date of the consummation of the Merger.

Additional Information

The foregoing description of the Merger Agreement and the CVR Agreement is not complete and is qualified in its entirety by reference to the Merger Agreement, which is attached as Exhibit 2.1 to this report, and the Form of CVR Agreement, which is attached as Exhibit B to the Merger Agreement, all of which are incorporated herein by reference.

The Merger Agreement and the CVR Agreement and the foregoing description have been included to provide investors with information regarding the terms of these agreements. They are not intended to provide any other factual information about Alexion or Achillion. The representations, warranties and covenants contained in each of these documents were or will be made only as of specified dates for the purposes of such agreement, were (except as expressly set forth therein) solely for the benefit of the parties to such agreements, and may be subject to qualifications and limitations agreed upon by such parties. In particular, in reviewing the representations, warranties and covenants contained in the Merger Agreement and discussed in the foregoing descriptions, it is important to bear in mind that such representations, warranties and covenants were negotiated with the principal purpose of allocating risk between the parties, rather than establishing matters as facts. Such representations, warranties and covenants may also be subject to a contractual standard of materiality different from those generally applicable to stockholders and reports and documents filed with the U.S. Securities and Exchange Commission (the "SEC"). Investors should not rely on such representations, warranties and covenants as characterizations of the actual state of facts or circumstances described therein. Information concerning the subject matter of such representations, warranties and covenants may change after the date of the agreements, which subsequent information may or may not be fully reflected in the parties' public disclosures.

Note to Investors and Security Holders

This document does not constitute a solicitation of any vote or approval. In connection with the proposed acquisition of Achillion by Alexion, Achillion intends to file with the SEC a proxy statement, as well as other relevant documents concerning the proposed transaction. INVESTORS AND SECURITY HOLDERS OF ACHILLION ARE URGED TO READ THE PROXY STATEMENT REGARDING THE PROPOSED TRANSACTION WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain these documents (when they become available) free of charge through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by Alexion will be available free of charge on Alexion's internet website at http://www.alexion.com under the tab, "Investors" and under the heading "SEC . . .



Item 8.01 Other Events.


On October 16, 2019, Alexion and Achillion issued a joint press release announcing the execution of the Merger Agreement. On October 16, 2019, Alexion provided an investor presentation to interested parties concerning the Merger Agreement. Copies of the press release and investor presentation are attached to this Current Report as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.

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Item 9.01 Financial Statements and Exhibits.


(d) Exhibits

 Exhibit
 Number                                      Description

    2.1            Agreement and Plan of Merger, dated October 15, 2019, by and among
                 Alexion, Beagle Merger Sub, Inc. and Achillion.*

   99.1            Joint Press Release, dated October 16, 2019

   99.2            Investor Presentation, dated October 16, 2019

   104           Cover Page Interactive Data File (embedded within the Inline XBRL
                 document)

* Schedules to the Agreement and Plan of Merger have been omitted pursuant to

Item 601(b)(2) of Regulation S-K. The registrant will furnish copies of any

such schedules to the U.S. Securities and Exchange Commission upon request.

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses

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