Item 1.01 Entry Into a Material Definitive Agreement
Agreement and Plan of Merger
On
At the Effective Time, each outstanding share of EIP common stock (other than
Excluded Shares (as defined below) and Dissenting Shares (as defined below))
will be converted into the right to receive shares of Diffusion common stock,
par value
Immediately following the Effective Time, former EIP stockholders are expected
to own approximately 77.3% of the outstanding shares of Diffusion Common Stock,
and stockholders of Diffusion as of immediately prior to the Effective Time are
expected to own approximately 22.7% of the outstanding shares of Diffusion
Common Stock, in each case, on a fully-diluted basis as calculated in the Merger
Agreement and assuming Parent
In addition, each option to purchase shares of EIP common stock (each, a "EIP Option") granted under EIP's equity incentive plan, whether vested or unvested, that is outstanding immediately prior to the Effective Time will be converted into an option to purchase shares of Diffusion Common Stock, on the same terms and conditions as were applicable to such EIP Option immediately prior to the Effective Time. All rights with respect to EIP common stock under EIP Options assumed by Diffusion will thereupon be converted into rights with respect to a number of shares of Diffusion Common Stock determined by multiplying (i) the number of shares of EIP common stock that were subject to such EIP Option, as in effect immediately prior to the Effective Time, by (ii) the Exchange Ratio, and rounding the resulting number down to the nearest whole number of shares of Diffusion Common Stock, at an exercise price per share determined by dividing (A) the per share exercise price of EIP common stock subject to such EIP Option, as in effect immediately prior to the Effective Time, by (B) the Exchange Ratio and rounding the resulting exercise price up to the nearest whole cent. Each Company Warrant (as defined in the Merger Agreement) that is outstanding and unexercised immediately prior to the Effective Time, will be converted into and become a warrant to purchase Parent Common Stock, and Diffusion will assume each such Company Warrant in accordance with its terms as adjusted by the Exchange Ratio.
The Merger Agreement contains a customary "no-shop" provision under which Diffusion is not permitted to, among other things, (i) solicit any alternative acquisition proposals, (ii) furnish any non-public information to any person in connection with any alternative acquisition proposal, (iii) engage or continue to participate in any negotiations or discussions with any person with respect to any alternative acquisition proposal, (iv) directly or indirectly, solicit, initiate, knowingly encourage or knowingly facilitate any inquiry that constitutes or would reasonably be expected to lead to an acquisition proposal, or (v) enter into, continue or otherwise participate in any discussions or negotiations with any third person with respect to a any such inquiry or an acquisition proposal . The "no-shop" provision is subject to certain exceptions that permit the board of directors of Diffusion (the "Diffusion Board") to comply with its fiduciary duties, which, under certain circumstances, would . . .
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Employment Agreement Amendments
On
The foregoing description of the Employment Agreement Amendments does not purport to be complete and is subject to, and qualified in its entirety by, the reference to the form of such agreements, which are filed as Exhibits 10.3, 10.4 and 10.5 to this Current Report on Form 8-K and are incorporated herein by reference.
Item 7.01. Regulation FD Disclosure
On
The information contained in the presentation is summary information prepared by
EIP that should be considered in the context of Diffusion's filings with the
Diffusion makes no admission or representation as to the materiality of any information in the presentation or otherwise related thereto and contained in this Current Report on Form 8-K. Such information is furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of Section 18 of the Exchange Act unless we specifically incorporate it by reference in a document filed under the Exchange Act, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as previously set forth by specific reference in such a filing.
Item 8.01. Other Events
On
No Offer or Solicitation
This communication does not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No public offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
--------------------------------------------------------------------------------
Important Additional Information and Where to Find It
In connection with the proposed transaction between Diffusion and EIP, Diffusion
intends to file relevant materials with the
Participants in the Solicitation
Diffusion and EIP, and each of their respective directors and executive officers
and certain of their other members of management and employees, may be deemed to
be participants in the solicitation of proxies in connection with the proposed
transaction. Information regarding these persons and their interests in the
transaction will be included in the prospectus and proxy statement relating to
the transaction and other relevant materials to be filed with the
Forward-Looking Statements
This Current Report on Form 8-K includes express and implied forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995, as amended, regarding management's intentions, plans, beliefs,
expectations or forecasts for the future, including, but not limited to, the
timing and potential outcome of the proposed transaction between Diffusion and
EIP; the expected ownership percentages of the combined company; and the
expected management team and board of directors of the combined company. Terms
such as "believes," "estimates," "anticipates," "expects," "plans," "intends,"
"may," "could," "might," "will," "should," "approximately," or other words that
convey uncertainty of future events or outcomes may identify these
forward-looking statements. Although there is believed to be reasonable basis
for each forward-looking statement contained herein, forward-looking statements
by their nature involve risks and uncertainties, known and unknown, many of
which are beyond the parties' control and, as a result, actual results could
differ materially from those expressed or implied in any forward-looking
statement. Particular risks and uncertainties include, among other things, those
related to the completion of the proposed transaction, including the need for
stockholder approval and the satisfaction of closing conditions; the cash
balances of the combined company following the closing, if completed, of the
proposed transaction; the ability of Diffusion to remain listed on the Nasdaq
Capital Market, as well as comply with any Nasdaq rules and regulations related
to the proposed transaction; the price of Diffusion's securities, which may be
volatile due to a variety of factors, including changes in the competitive and
highly regulated industries in which Diffusion operates; variations in operating
performance across competitors; changes in laws and regulations affecting
Diffusion's or EIP's business; the ability to implement business plans,
forecasts, and other expectations after the completion of the proposed
transaction; general economic, political, business, industry, and market
conditions, inflationary pressures, and geopolitical conflicts; and the other
factors discussed under the heading "Risk Factors" in Diffusion's most recent
Annual Report on Form 10-K and other filings with the
--------------------------------------------------------------------------------
Item 9.01 - Financial Statements and Exhibits
(d) Exhibits Exhibit Description Number
2.1 Agreement and Plan of Merger, dated as ofMarch 30, 2023 , by and amongDiffusion Pharmaceuticals Inc. ,EIP Pharma, Inc. andDawn Merger Sub Inc. (1) 10.1 Form ofEIP Pharma, Inc. Stockholder Support Agreement, dated as ofMarch 30, 2023 10.2 Form of Lock-up Agreement, dated as ofMarch 30, 2023 10.3 Amendment, datedMarch 29, 2023 , to Employment Agreement, datedSeptember 8, 2020 , by and betweenDiffusion Pharmaceuticals Inc. and Robert J. Cobuzzi, Ph.D. 10.4 Amendment, datedMarch 29, 2023 , to Employment Agreement, datedSeptember 21, 2018 , by and betweenDiffusion Pharmaceuticals Inc. andWilliam Hornung 10.5 Amendment, datedMarch 29, 2023 , to Employment Agreement, datedSeptember 23, 2020 , by and betweenDiffusion Pharmaceuticals Inc. andWilliam Elder 99.1 Form ofDiffusion Pharmaceuticals Inc. Stockholder Support Agreement, dated as ofMarch 30, 2023 99.2 Joint Press Release ofDiffusion Pharmaceuticals Inc. andEIP Pharma, Inc. , issuedMarch 30, 2023 99.3 EIP Pharma Corporate Presentation, datedMarch 30, 2023 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) (1) Schedules and exhibits have been omitted from this filing pursuant to Item 601(b)(2) of Regulation S-K. Diffusion agrees to furnish on a supplemental basis a copy of any omitted schedule or exhibit to theSEC upon its request; provided, however, that Diffusion may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.
--------------------------------------------------------------------------------
© Edgar Online, source