AGREEMENT AND PLAN OF MERGER BY AND AMONG CORDOVA SCIENCES, INC., TIKVAH THERAPEUTICS, INC. AND CORDOVA ACQUISITION CORP.
Exhibit
2.1
AGREEMENT
AND PLAN OF MERGER
BY
AND AMONG
▇▇▇▇▇▇▇
SCIENCES, INC.,
TIKVAH
THERAPEUTICS, INC.
AND
▇▇▇▇▇▇▇
ACQUISITION CORP.
This
AGREEMENT AND PLAN OF MERGER (this “Agreement”) is made and entered into as of
September 24, 2007, among ▇▇▇▇▇▇▇ Sciences, Inc., a Delaware corporation
(“Parent”), Tikvah Therapeutics, Inc., a Delaware corporation (“Tikvah”), and a
corporation to be formed as ▇▇▇▇▇▇▇ Acquisition Corp., a Delaware corporation
which will be a wholly-owned subsidiary of Parent (“▇▇▇▇▇▇▇ Merger
Sub”).
RECITALS
A. Upon
the
terms and subject to the conditions of this Agreement and in accordance with
the
Delaware General Corporation Law (“DGCL”), Parent, Tikvah and ▇▇▇▇▇▇▇ Merger Sub
intend to enter into a business combination transaction.
B. The
Board
of Directors of Tikvah (i) has determined that the Merger (as defined in Section
1.1 below) is consistent with and in furtherance of the long-term business
strategy of Tikvah and fair to, and in the best interests of Tikvah and its
stockholders, (ii) has approved this Agreement, the Merger and the other
transactions contemplated by this Agreement, (iii) has adopted a resolution
declaring the Merger advisable, and (iv) has determined to recommend that the
stockholders of Tikvah adopt this Agreement.
C. The
Board
of Directors of Parent (i) has determined that the Merger is consistent with
and
in furtherance of the long-term business strategy of Parent and fair to, and
in
the best interests of Parent and its stockholders, (ii) has approved this
Agreement, the Merger and the other transactions contemplated by this Agreement,
(iii) has adopted a resolution declaring the Merger advisable, and (iv) has
approved the issuance of shares of Parent Common Stock (as defined below)
pursuant to the Merger (the “Share Issuance”).
D. The
Board
of Directors of ▇▇▇▇▇▇▇ Merger Sub (i) will determine that the Merger is
consistent with and in furtherance of the long-term business strategy of ▇▇▇▇▇▇▇
Merger Sub and fair to and in the best interests of ▇▇▇▇▇▇▇ Merger Sub and
its
stockholders, (ii) will approve this Agreement, the Merger and the other
transactions contemplated by this Agreement, (iii) will adopte a resolution
declaring the Merger advisable, and (iv) will determine to recommend that the
sole stockholder of ▇▇▇▇▇▇▇ Merger Sub adopt this Agreement.
E. The
Merger is being done in connection with and will be consummated immediately
after the closing of an offering of securities by Tikvah (the “Offering”) of a
minimum amount of $30,000,000 and a maximum of $60,000,000 in aggregate purchase
price. The offering is described in the Confidential Offering Memorandum of
Tikvah, dated September 24, 2007 (the “Memorandum”)
NOW,
THEREFORE, in consideration of the covenants, promises and representations
set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
ARTICLE
I
THE
MERGER
1.1. The
Merger.
At the
Effective Time (as defined in Section 1.2 hereof) and subject to and upon the
terms and conditions of this Agreement and the applicable provisions of the
DGCL, ▇▇▇▇▇▇▇ Merger Sub shall be merged with and into Tikvah (the “Merger”),
the separate corporate existence of ▇▇▇▇▇▇▇ Merger Sub shall cease and Tikvah
shall continue as the surviving corporation and shall become a wholly-owned
subsidiary of Parent. The surviving corporation after the Merger is sometimes
referred to hereinafter as the “Tikvah Surviving Corporation.”
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1.2. Effective
Time.
Unless
this Agreement is earlier terminated pursuant to Article VII hereof, the closing
of the Merger and the other transactions contemplated by this Agreement (the
“Closing”) will take place at the offices of Parent, at a time and date to be
specified by the parties, but in no event later than two (2) business days
following satisfaction or waiver of the conditions set forth in Article VI
hereof. The date upon which the Closing actually occurs is herein referred
to as
the “Closing Date.” On the Closing Date, the parties hereto shall cause the
Merger to be consummated by filing a Certificate of Merger or like instrument
(a
“Certificate of Merger”) with the Secretary of State of the State of Delaware,
in accordance with the relevant provisions of the DGCL (the times at which
the
Merger has become fully effective (or such later time as may be agreed in
writing by Tikvah and specified in the Certificate of Merger) is referred to
herein as the “Effective Time”).
1.3. Effect
of the Merger.
(a) At
the
Effective Time, the effect of the Merger shall be as provided in the applicable
provisions of the DGCL. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time, except as provided herein, all the
property, rights, privileges, powers and franchises of Tikvah and ▇▇▇▇▇▇▇ Merger
Sub shall vest in the Tikvah Surviving Corporation, and all debts, liabilities
and duties of Tikvah and ▇▇▇▇▇▇▇ Merger Sub shall become the debts, liabilities
and duties of the Tikvah Surviving Corporation.
(b) At
the
Effective Time, the properties and assets of Parent and ▇▇▇▇▇▇▇ Merger Sub
will
be free and clear of any and all encumbrances, charges, claims, equitable
interests, liens, options, pledges, security interests, mortgages, rights of
first refusal or restrictions of any kind and nature (collectively, the
“Encumbrances”), except for such liabilities, accounts payable, debts, adverse
claims, duties, responsibilities and obligations of every kind or nature,
whether accrued or unaccrued, known or unknown, direct or indirect, absolute,
contingent, liquidated or unliquidated and whether arising under, pursuant
to or
in connection with any contract, tort, strict liability or otherwise
(collectively the “Liabilities”) of Parent which shall be set forth in Parent’s
Balance Sheet or incurred in the ordinary course of business after such
date.
1.4. Certificates
of Incorporation; Bylaws.
(a) At
the
Effective Time, the Certificate of Incorporation of Tikvah as in effect
immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Tikvah Surviving Corporation at and after the Effective
Time.
(b) The
Bylaws of Tikvah as in effect immediately prior to the Effective Time shall
be
the Bylaws of the Tikvah Surviving Corporation at and after the Effective
Time.
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1.5. Tikvah
Directors and Officers.
(a) The
directors of Tikvah immediately prior to the Effective Time shall be the
directors of the Tikvah Surviving Corporation at and after the Effective
Time.
(b) The
officers of Tikvah immediately prior to the Effective Time shall be the officers
of the Tikvah Surviving Corporation at and after the Effective
Time.
1.6. Effect
on Capital Stock.
Subject
to the terms and conditions of this Agreement, at the Effective Time, by virtue
of the Merger and without any action on the part of Parent, Tikvah and ▇▇▇▇▇▇▇
Merger Sub or the holders of any of the following securities, the following
shall occur:
(a) Conversion
of Tikvah Capital Stock. Each share of common stock, par value $0.001 per share,
of Tikvah (the “Tikvah Common Stock”) issued and outstanding immediately prior
to the Effective Time (other than shares held by holders who have not consented
to and approved the adoption of this Agreement and who qualify under and have
complied with all of the provisions of Section 262 of the DGCL) will be
automatically converted into one share of Common Stock, par value $0.001 per
share, of Parent (the “Parent Common Stock”) (such aggregate shares of Parent
Common Stock being referred to in this Agreement as the “Tikvah Merger
Consideration”). If any shares of Tikvah Common Stock outstanding immediately
prior to the Effective Time are unvested or are subject to a repurchase option,
risk of forfeiture or other condition under any applicable restricted stock
purchase agreement or other agreement with Tikvah, then the shares of Parent
Common Stock issued in exchange for such shares of Tikvah Common Stock will
also
be unvested subject to the same repurchase option, risk of forfeiture or other
condition, and the certificates representing such shares of Parent Common Stock
shall accordingly be marked with appropriate legends.
(b) Tikvah
Stock Options. At the Effective Time, the Tikvah Therapeutics, Inc. 2005 Stock
Incentive Plan (the “Tikvah Option Plan”), and all options to purchase Tikvah
Common Stock then outstanding thereunder, shall be assumed by Parent.
(c) Tikvah
Warrants. At the Effective Time, all warrants to purchase Tikvah Common Stock
then outstanding shall be assumed by Parent, and shall become exercisable for
shares of Parent Common Stock.
(d) Adjustments
to Tikvah Merger Consideration. Except as described in Section 1.7, the Tikvah
Merger Consideration shall be adjusted to reflect appropriately the effect
of
any stock split, reverse stock split, stock dividend, reorganization,
recapitalization, reclassification, combination, exchange of shares or other
like change with respect to Parent Common Stock or Tikvah Common Stock occurring
on or after the date hereof and prior to the Effective Time.
(e) Fractional
Shares. No fraction of a share of Parent Common Stock will be issued in the
Merger. At the Effective Time, each fractional share of Tikvah Capital Stock
shall be cancelled and such fractional share shall be rounded to the nearest
whole share.
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1.7. No
Further Ownership Rights in Tikvah Common Stock.
All
shares of Parent Common Stock issued in accordance with the terms hereof shall
be deemed to have been issued in full satisfaction of all rights pertaining
to
such shares of Tikvah Common Stock. After the Effective Time, there shall be
no
further registration of transfers on the records of Tikvah Surviving Corporation
of shares of Tikvah Common Stock which were outstanding immediately prior to
the
Effective Time. If, after the Effective Time, certificates representing Tikvah
Common Stock (“Certificates”) are presented to Tikvah Surviving Corporation for
any reason, they shall be canceled and exchanged as provided in this Article
I.
1.8. Lost,
Stolen or Destroyed Certificates.
In the
event that any Certificates shall have been lost, stolen or destroyed, the
Parent shall issue in exchange for such lost, stolen or destroyed Certificates,
upon the making of an affidavit of that fact by the holder thereof, certificates
representing the shares of Parent Common Stock into which the shares of Tikvah
Common Stock represented by such Certificates were converted pursuant to Section
1.6(a); provided, however, that the Parent may, in its discretion and as a
condition precedent to the issuance of such certificates representing shares
of
Parent Common Stock require the owner of such lost, stolen or destroyed
Certificates to indemnify Parent against any claim that may be made against
Parent or Tikvah Surviving Corporation with respect to the Certificates alleged
to have been lost, stolen or destroyed.
1.9. Tax
Treatment.
It is
intended by the parties hereto that the Merger shall constitute a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code of 1986,
as
amended (the “Code”) and that Parent, Tikvah and ▇▇▇▇▇▇▇ Merger Sub are intended
to be “parties to a reorganization” within the meaning of Section 368(b) of the
Code. Each of the parties hereto adopts this Agreement as a “plan of
reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the
United States Treasury Regulations (the “Regulations”). Both prior to and after
the Closing, each party’s books and records shall be maintained, and all
federal, state and local income tax returns and schedules thereto shall be
filed
in a manner consistent with the Merger being qualified as a reverse triangular
merger under Section 368(a)(2)(E) of the Code (and comparable provisions of
any
applicable state or local laws), except to the extent the Merger is determined
in a final administrative or judicial decision not to qualify as a
reorganization within the meaning of Code Section 368(a).
1.10. Taking
of Necessary Action; Further Action.
If, at
any time after the Effective Time, any further action is necessary or desirable
to carry out the purposes of this Agreement and to vest the Tikvah Surviving
Corporation (and/or its successor in interest) with full right, title and
possession to all assets, property, rights, privileges, powers and franchises
of
Tikvah and ▇▇▇▇▇▇▇ Merger Sub, the officers and directors of Parent and the
Tikvah Surviving Corporation shall be fully authorized (in the name of ▇▇▇▇▇▇▇
Merger Sub, Tikvah and otherwise) to take all such necessary
action.
1.11. Restrictions
on Transfer; Legends.
Any
shares of Parent Common Stock issued in the Merger will not be transferable
except (1) pursuant to an effective registration statement under the Securities
Act of 1933, as amended (the “Securities Act”) or (2) upon receipt by Parent of
a written opinion of counsel reasonably satisfactory to Parent that is
knowledgeable in securities laws matters to the effect that the proposed
transfer is exempt from the registration requirements of the Securities Act
and
relevant state securities laws. Restrictive legends must be placed on all
certificates representing shares of Parent issued in the Merger, substantially
as follows:
“THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE, AND WERE OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM
THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THESE SECURITIES
MAY NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR SUCH OTHER
LAWS.”
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1.12. Exchange
of Stock Certificates.
(a) The
purchasers of Tikvah Common Stock in the Offering will automatically receive
stock certificates for the shares of Parent Common Stock which are issued as
merger consideration for their shares of Tikvah Common Stock as required by
Section 1.6 and as contemplated by the purchase agreements executed in
connection with the Offering.
(b) Holders
of Tikvah Common Stock issued prior to the Offering will receive a letter of
transmittal directing them to send their certificates to Parent or its transfer
agent for exchange
as set
forth in this Section 1.12(b).
(c) Each
share of Tikvah Common Stock issued and outstanding immediately prior to the
Effective Time held by stockholders who shall have properly exercised their
appraisal rights with respect thereto under Section 262 of the DGCL (such
shares, collectively, the “Dissenting Shares”) shall not be converted into the
right to receive the Tikvah Merger Consideration pursuant to the Merger, but
shall be entitled to receive payment of the appraised value of such shares
in
accordance with the provisions of Section 262 of the DGCL, except that each
Dissenting Share held by a stockholder who shall thereafter withdraw his or
her
demand for appraisal or shall fail to perfect his or her right to such payment
as provided in such Section 262 shall be deemed to be converted, as of the
Effective Time, into the right to receive the Tikvah Merger Consideration in
the
form such holder otherwise would have been entitled to receive as a result
of
the Merger.
(d) Tikvah
shall give Parent (i) prompt notice of any written demands for appraisal of
any
Tikvah Common Stock, withdrawals of such demands, and any other instruments
that
relate to such demands received by Tikvah and (ii) the opportunity to direct
all
negotiations and proceedings with respect to demands for appraisal under the
DGCL. Tikvah shall not, except with the prior written consent of Parent, make
any payment with respect to any demands for appraisal of shares of Tikvah Common
Stock or offer to settle or settle any such demands.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES OF TIKVAH
Tikvah
hereby represents and warrants to Parent that:
2.1. Subsidiaries.
Tikvah
has no direct or indirect subsidiaries.
5
2.2. Organization
and Qualification.
Tikvah
is an entity duly incorporated or otherwise organized, validly existing and
in
good standing under the laws of the State of Delaware, with the requisite power
and authority to own and use its properties and assets and to carry on its
business as currently conducted. Tikvah is not in violation of any of the
provisions of its Certificate of Incorporation or Bylaws. Tikvah is duly
qualified to do business and in good standing as a foreign corporation in each
jurisdiction in which the character of the properties owned or leased by it
or
the nature of its activities makes such qualification necessary, other than
any
jurisdiction in which the failure so to qualify or be in good standing would
not
have a Material Adverse Effect.
2.3. Authorization,
Enforcement.
Tikvah
has the requisite corporate power and authority to enter into and to consummate
the Merger. The execution and delivery of this Agreement by Tikvah and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of Tikvah and no further consent
or action is required by Tikvah, other than the Required Approval (as defined
below) and the approval of Tikvah’s stockholders. This Agreement, when executed
and delivered in accordance with the terms hereof, will constitute the valid
and
binding obligation of Tikvah enforceable against Tikvah in accordance with
its
terms, subject to the foregoing approval, applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors’ rights and remedies generally and general principles of
equity.
2.4. No
Conflicts.
The
execution, delivery and performance of this Agreement by Tikvah and the
consummation by Tikvah of the Merger do not and will not, subject to filing
of
the Certificate of Merger with the Delaware Secretary of State: (i) conflict
with or violate any provision of Tikvah’s Certificate of Incorporation or
Bylaws, (ii) conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation (with or
without notice or lapse of time or both) of, any material agreement, credit
facility, debt or other instrument (evidencing Tikvah debt or otherwise) or
other understanding to which Tikvah is a party or by which any material property
or asset of Tikvah is bound or affected, or (iii) result in a violation of
any
law, rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority as currently in effect to which Tikvah
is
subject (including federal and state securities laws and regulations), or by
which any material property or asset of Tikvah is bound or affected; except
in
the case of each of clauses (ii) and (iii), such as could not, individually
or
in the aggregate (a) adversely affect the legality, validity or enforceability
of the Merger, (b) have or result in a material adverse effect on the results
of
operations, assets, prospects, business and condition (financial or otherwise)
of Tikvah, taken as a whole, or (c) adversely impair Tikvah’s ability to perform
fully on a timely basis its obligations under this Merger Agreement (any of
(a),
(b) or (c), a “Tikvah Material Adverse Effect”).
2.5. Filings,
Consents and Approvals.
Tikvah
is not required to obtain any consent, waiver, authorization or order of, give
any notice to, or make any filing or registration with, any court or other
federal, state, local or other governmental authority in connection with the
execution, delivery and performance by Tikvah of this Agreement, other than
the
filing with the Secretary of State of Delaware of a certificate of merger (the
“Required Approval”).
6
2.6. Capitalization.
The
number of shares and type of all authorized, issued and outstanding capital
stock and other securities of Tikvah prior to the closing of the Offering and
the Merger is as set forth in the Memorandum.
2.7. Financial
Statements.
The
financial statements of Tikvah included in the Memorandum have been prepared
in
accordance with U.S. generally accepted accounting principles applied on a
consistent basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes thereto, and
fairly present in all material respects the financial position of Tikvah as
of
and for the dates thereof and the results of operations and cash flows for
the
periods then ended, subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.
2.8. Material
Changes.
Since
the date of the latest financial statements included in the Memorandum: (i)
there has been no event, occurrence or development that has had a Tikvah
Material Adverse Effect, (ii) Tikvah has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past practice,
and
(B) liabilities not required to be reflected in Tikvah’s financial statements
pursuant to GAAP, (iii) Tikvah has not altered its method, principle or practice
of financial or tax accounting or the identity of its auditors, (iv) Tikvah
has
not declared or made any dividend or distribution of cash or other property
to
its stockholders except in the ordinary course of business consistent with
prior
practice, or purchased, redeemed or made any agreements to purchase or redeem
any shares of its capital stock except consistent with prior practice or
pursuant to existing Tikvah stock option or similar plans, (v) Tikvah has not
issued any equity shares to any officer, director or affiliate, except pursuant
to existing Tikvah stock option or similar plans; (vi) there has been no change
in the officers, directors, key employees or key independent contractors of
Tikvah (except such persons as may be hired or terminated prior to the Closing
Date in the ordinary course of business), (vii) there has been no labor trouble
or claim of unfair labor or employment practices involving Tikvah, (viii) there
has been no forgiveness or cancellation of any debt or claim by Tikvah or any
waiver by Tikvah of any right of material value, other than compromises of
accounts receivable in the ordinary course of business, (ix) there has been
no
incurrence of any lien by Tikvah or on any of the capital stock, other
securities, properties or assets owned or leased by Tikvah, or (x) there has
been no agreement, understanding or commitment by or on behalf of Tikvah,
whether in writing or otherwise, to do or permit any of the things referred
to
in this Section 2.8.
2.9. Litigation.
There
is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of Tikvah, threatened against or affecting Tikvah
or its properties before or by any court, arbitrator, governmental or
administrative agency or regulatory authority (federal, state, county, local
or
foreign) (collectively, an “Action”) which: (i) adversely affects or challenges
the legality, validity or enforceability of this Agreement or (ii) would, if
there were an unfavorable decision, individually or in the aggregate, have
or
reasonably be expected to result in a Tikvah Material Adverse Effect. Tikvah
is
not nor has it ever been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws. There has
not
been, and to the knowledge of Tikvah, there is not pending or contemplated,
any
investigation by the SEC involving Tikvah.
7
2.10. Compliance.
Except
as disclosed in the Memorandum, Tikvah is not: (i) in default under or in
violation of (and no event has occurred that has not been waived that, with
notice or lapse of time or both, would result in a default by Tikvah under),
nor
has Tikvah received notice of a claim that it is in default under or that it
is
in violation of, any material indenture, loan or credit agreement or any other
material agreement or instrument to which it is a party or by which it or any
of
its properties is bound (whether or not such default or violation has been
waived), which default or violation would have or result in a Tikvah Material
Adverse Effect, (ii) in violation of any order of any court, arbitrator or
governmental body, or (iii) in violation of any statute, rule or regulation
of
any governmental authority, except in each case as would not, individually
or in
the aggregate, have or result in a Tikvah Material Adverse Effect. Tikvah has
not committed, been charged with, or, to Tikvah’s knowledge, been under
investigation with respect to, nor does there exist, any violation by Tikvah
of
any provision of any federal, state, or local law or administrative regulation,
except for any violations that, both singly or in the aggregate, have not had
and could not reasonably be expected to have a Tikvah Material Adverse Effect.
Tikvah has and maintains all licenses, permits, and other authorizations from
all such governmental authorities as are legally required for the conduct of
its
business or in connection with the ownership or use of its properties, except
for any such licenses, permits, and other authorizations, the failure to obtain
or maintain which in effect, both singly or in the aggregate, has not had and
could not reasonably be expected to have a Tikvah Material Adverse Effect,
and
all of which are in full force and effect in all material respects.
2.11. Regulatory
Permits.
Except
as otherwise described in the Memorandum, Tikvah possesses or has applied for
all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct its business
as described in the Memorandum, except where the failure to possess such permits
would not, individually or in the aggregate, have a Tikvah Material Adverse
Effect (“Material Permits”), and Tikvah has not received any notice of
proceedings relating to the revocation or modification of any Material Permit.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
OF
PARENT AND ▇▇▇▇▇▇▇ MERGER SUB
Each
of
Parent and ▇▇▇▇▇▇▇ Merger Sub, jointly and severally, hereby represents and
warrants to Tikvah that (provided that ▇▇▇▇▇▇▇ Merger Sub only represents from
date of its formation and as of the Closing Date):
3.1. Organization
of Parent and ▇▇▇▇▇▇▇ Merger Sub.
(a) Each
of
Parent and ▇▇▇▇▇▇▇ Merger Sub is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation;
has the corporate power and authority to own, lease and operate its assets
and
property and to carry on its business as now being conducted; and is duly
qualified to do business and in good standing as a foreign corporation in each
jurisdiction in which the failure to be so qualified would have a Parent
Material Adverse Effect. As used in this Agreement, the term “Parent Material
Adverse Effect” means a material adverse effect on the condition (financial or
otherwise), business, assets or results of operations of Parent and ▇▇▇▇▇▇▇
Merger Sub as a whole or on the ability of Parent to consummate the transactions
contemplated by this Agreement; it being understood, however, that Parent’s
continuing incurrence of losses, as long as such losses are in the ordinary
course of business shall not, alone, be deemed to be a Parent Material Adverse
Effect.
8
(b) Parent
has no subsidiaries other than ▇▇▇▇▇▇▇ Merger Sub.
(c) Parent
has delivered or made available to Tikvah a true and correct copy of the
Certificate of Incorporation and Bylaws of each of Parent and ▇▇▇▇▇▇▇ Merger
Sub, each as amended to date, and each such instrument is in full force and
effect. Neither Parent nor ▇▇▇▇▇▇▇ Merger Sub is in violation of any of the
provisions of its Certificate of Incorporation or Bylaws or equivalent governing
instruments.
3.2. Capital
Structure.
The
authorized capital stock of Parent consists of 75,000,000 shares of Common
Stock, $0.001 par value, of which there are 125,000 shares issued and
outstanding and 10,000,000 shares of Preferred Stock, $0.001 par value, of
which
there are no shares issued and outstanding. The authorized capital stock of
▇▇▇▇▇▇▇ Merger Sub will consist of 100 shares of Common Stock, par value $0.001
per share, of which there will be 100 shares issued and outstanding. There
are
no options, warrants, convertible debt or other equity or derivative securities
of Parent or ▇▇▇▇▇▇▇ Merger Sub outstanding. All outstanding shares of Parent
and ▇▇▇▇▇▇▇ Merger Sub Common Stock are duly authorized, validly issued, fully
paid and nonassessable, were issued in compliance with applicable securities
laws and are not subject to preemptive rights created by statute, the
Certificate of Incorporation or Bylaws of Parent and ▇▇▇▇▇▇▇ Merger Sub or
any
agreement or document to which Parent or ▇▇▇▇▇▇▇ Merger Sub is a party or by
which it is bound.
3.3. Obligations
With Respect to Capital Stock.
There
are no options, warrants, equity securities, partnership interests or similar
ownership interests, calls, rights (including preemptive rights), commitments
or
agreements of any character to which Parent or ▇▇▇▇▇▇▇ Merger Sub is a party
or
by which it is bound obligating Parent or ▇▇▇▇▇▇▇ Merger Sub to issue, deliver
or sell, or cause to be issued, delivered or sold, or repurchase, redeem or
otherwise acquire, or cause the repurchase, redemption or acquisition, of any
shares of capital stock of Parent or ▇▇▇▇▇▇▇ Merger Sub or obligating Parent
or
▇▇▇▇▇▇▇ Merger Sub to grant, extend, accelerate the vesting of or enter into
any
such option, warrant, equity security, partnership interest or similar ownership
interest, call, right, commitment or agreement. There are no registration rights
and there are no voting trusts, proxies or other agreements or understandings
with respect to any equity security of any class of Parent or with respect
to
any equity security of any class of ▇▇▇▇▇▇▇ Merger Sub.
3.4. Authority.
(a) Each
of
Parent and ▇▇▇▇▇▇▇ Merger Sub has all requisite corporate power and authority
to
enter into this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the consummation of
the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of each of Parent and ▇▇▇▇▇▇▇ Merger Sub, subject
only to the filing and recordation of the Certificate of Merger pursuant to
the
DGCL. This Agreement has been duly executed and delivered by each of Parent
and
▇▇▇▇▇▇▇ Merger Sub (when formed) and, assuming the due authorization, execution
and delivery by Tikvah, constitutes the valid and binding obligation of each
of
Parent and ▇▇▇▇▇▇▇ Merger Sub, enforceable in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar laws and general principles of
equity. The execution and delivery of this Agreement by each of Parent and
▇▇▇▇▇▇▇ Merger Sub, do not, and the performance of this Agreement by each of
Parent and ▇▇▇▇▇▇▇ Merger Sub, will not (i) conflict with or violate the
Certificate of Incorporation or Bylaws of Parent, or ▇▇▇▇▇▇▇ Merger Sub,
respectively (collectively, the “Charter Documents”), (ii) subject to compliance
with the requirements set forth in Section 3.4(b) below, conflict with or
violate any law, rule, regulation, order, judgment or decree applicable to
Parent or ▇▇▇▇▇▇▇ Merger Sub, respectively, or by which its or any of their
respective properties is bound or affected or (iii) result in any breach of,
or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or impair any of, Parent’s or ▇▇▇▇▇▇▇ Merger
Sub’s rights or alter the rights or obligations of any third party under, or to
Parent’s knowledge, give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties or assets of Parent or ▇▇▇▇▇▇▇ Merger
Sub,
respectively, pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which any of Parent or ▇▇▇▇▇▇▇ Merger Sub is a party or by which Parent
or
▇▇▇▇▇▇▇ Merger Sub, or any of their respective properties are bound or affected,
other than as set forth in the Memorandum.
9
(b) No
consent, approval, order or authorization of, or registration, declaration
or
filing with any U.S. or foreign federal, state, local, municipal or other
governmental authority or agency, including any governmental division,
department, commission or other body (“Governmental Entity”) is required by or
with respect to any of Parent or ▇▇▇▇▇▇▇ Merger Sub in connection with the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby, except for (i) the filing of the Certificate of Merger
with
the Secretary of State of Delaware, (ii) such consents, approvals, orders,
authorizations, registrations, declarations and filings as may be required
under
applicable federal and state securities laws (including under Regulation D)
and
(iii) such other consents, authorizations, filings, approvals and registrations
which, if not obtained or made, individually or in the aggregate, would not
be
reasonably likely to have a Parent Material Adverse Effect.
3.5. Parent
SEC Filings; Parent Financial Statements.
(a) The
Parent has filed all forms, reports and documents required to be filed with
the
SEC. All such required forms, reports and documents (including the financial
statements, exhibits and schedules thereto and those documents that the Parent
may file subsequent to the date hereof) are collectively referred to herein
as
the “Parent SEC Reports” and Parent has provided or made available to Tikvah
copies thereof and of all correspondence to or from the SEC with respect to
the
Parent. As of their respective dates, the Parent SEC Reports (i) were prepared
in accordance with the requirements of the Securities Act of 1933, as amended
(the “Securities Act”) or the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), as the case may be, and the rules and regulations of the SEC
thereunder applicable to such Parent SEC Reports, and (ii) did not at the time
they were filed (or if amended or superseded by a filing prior to the date
of
this Agreement, then on the date of such filing) contain any untrue statement
of
a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
10
(b) Each
of
the financial statements (including, in each case, any related notes thereto)
contained in the Parent SEC Reports (the “Parent Financials”), including any
Parent SEC Reports filed after the date hereof until the Closing, as of their
respective dates, (i) complied as to form in all material respects with the
published rules and regulations of the SEC with respect thereto, (ii) was
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved (except as may be indicated in the notes thereto or, in the
case of unaudited interim financial statements, as may be permitted by the
SEC
on Form 10-QSB under the Exchange Act) and (iii) fairly presented the financial
position of the Parent at the respective dates thereof and the consolidated
results of its operations and cash flows for the periods indicated, except
that
the unaudited interim financial statements were or are subject to normal and
recurring year-end adjustments which were not, or are not expected to be,
material in amount. The most recent balance sheet of the Parent in the Parent
Financials as of the date hereof is hereinafter referred to as the “Parent
Balance Sheet.” Except as disclosed in the Parent Financials, the Parent does
not have any liabilities (absolute, accrued, contingent or otherwise) of a
nature required to be disclosed on a balance sheet or in the related notes
to
the consolidated financial statements prepared in accordance with GAAP which
are, individually or in the aggregate, material to the business, results of
operations or financial condition of the Parent, except liabilities (i) provided
for in the Parent Balance Sheet, or (ii) incurred since the date of the Parent
Balance Sheet in the ordinary course of business consistent with past practices
and which would not reasonably be expected to have a Parent Material Adverse
Effect.
(c) Parent
has heretofore furnished to Tikvah a complete and correct copy of any amendments
or modifications to the Parent SEC Reports, if any, which have not yet been
filed with the SEC but which will be required to be filed, to agreements,
documents or other instruments which previously had been filed by the Parent
with the SEC pursuant to the Securities Act or the Exchange Act.
3.6. Absence
of Certain Changes or Events.
Except
as disclosed in the Parent SEC Reports filed prior to the date hereof or as
contemplated by this Agreement, since the date of the Parent Balance Sheet,
Parent has conducted business only in, and has not engaged in any material
transaction other than according to, the ordinary and usual course of business
and there has not been (i) any change that individually or in the aggregate,
has
had or is reasonably likely to have a Parent Material Adverse Effect, (ii)
any
material damage, destruction or other casualty loss with respect to any material
asset or property owned, leased or otherwise used by Parent or ▇▇▇▇▇▇▇ Merger
Sub, whether or not covered by insurance, (iii) any declaration, setting aside
or payment of any dividend or other distribution in cash, stock or property
in
respect of the capital stock of Parent, except for dividends or other
distributions on its capital stock publicly announced prior to the date hereof
and except as expressly permitted hereby, (iv) any event that would constitute
a
violation of Section 4.1 or Section 4.2 hereof, if such event occurred after
the
date of this Agreement and prior to the Effective Time, or (v) any change by
Parent in accounting principles, practices or methods.
11
3.7. Tax
Matters.
(a) For
purposes of this Agreement, (i) “Taxes” shall mean all Federal, state, local,
foreign, provincial, territorial or other taxes, imports, tariffs, fees, levies
or other similar assessments or liabilities and other charges of any kind,
including income taxes, profits taxes, franchise taxes, ad valorem taxes, excise
taxes, withholding taxes, stamp taxes or other taxes of or with respect to
gross
receipts, premiums, real property, personal property, windfall profits, sales,
use, transfers, licensing, employment, social security, workers’ compensation,
unemployment, payroll and franchises imposed by or under any law (meaning all
laws, statutes, ordinances and regulations of any governmental authority
including all decisions of any court having the effect of law), and any other
taxes, duties or assessments, together with all interest, penalties and
additions imposed with respect to such amounts, (ii) “Tax Returns” shall mean
any declaration, return, report, schedule, certificate, statement or other
similar document (including relating or supporting information) required to
be
filed with any Taxing Authority (as defined below), or where none is required
to
be filed with a Taxing Authority, the statement or other document issued by
the
applicable Taxing Authority in connection with any Tax, including, without
limitation, any information return, claim for refund, amended return or
declaration of estimated Tax, and (iii) “Taxing Authority” shall mean any
domestic, foreign, Federal, national, provincial, state, county or municipal
or
other local government or court, any subdivision, agency, commission or
authority thereof, or any quasi-governmental body exercising tax regulatory
authority.
(b) Parent
has (i) timely filed all Tax Returns that are required to have been filed by
it
with all appropriate Taxing Authorities (and all such returns are true and
correct and fairly reflect in all material respects its operations for tax
purposes), and (ii) timely paid all Taxes shown as owing on such Tax Returns
or
assessed by any Taxing Authority (other than Taxes the validity of which are
being contested in good faith by appropriate proceedings). The assessment of
any
additional Taxes for periods for which Tax Returns have been filed is not
expected to exceed reserves made in accordance with GAAP and reflected in the
Parent Financial Statements and the Parent Balance Sheet and, to Parent’s
knowledge, there are no material unresolved questions or claims concerning
Parent’s Tax liability. Parent’s Tax Returns have not been reviewed or audited
by any Taxing Authority and no deficiencies for any Taxes have been proposed,
asserted or assessed either orally or in writing against Parent or ▇▇▇▇▇▇▇
Merger Sub that are not adequately reserved for in accordance with GAAP. No
liens exist for Taxes (other than liens for Taxes not yet due and payable)
with
respect to any of the assets or properties of Parent or ▇▇▇▇▇▇▇ Merger
Sub.
(c) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub has outstanding any agreements or waivers
extending, or having the effect of extending, the statute of limitations with
respect to the assessment or collection of any Tax or the filing of any Tax
Return.
(d) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub is a party to or bound by any tax-sharing
agreement, tax indemnity obligation or similar agreement, arrangement or
practice with respect to Taxes (including any advance pricing agreement, closing
agreement or other agreement relating to Taxes with any Taxing
Authority).
(e) Parent
shall not be required to include in a taxable period ending after the Closing
Date any taxable income attributable to income that accrued in a prior taxable
period but was not recognized in any prior taxable period as a result of the
installment method of accounting, the long-term contract method of accounting,
the cash method of accounting or Section 481 of the Code or any comparable
provision of state, local or foreign Tax law, or for any other
reason.
12
(f) Parent
has complied in all material respects with all applicable laws relating to
the
payment and withholding of Taxes (including, without limitation, withholding
of
Taxes pursuant to Sections 1441, 1442, 3121, 3402 and 3406 of the Code or any
comparable provision of any state, local or foreign laws) and has, within the
time and in the manner prescribed by applicable law, withheld from and paid
over
to the proper Taxing Authorities all amounts required to be so withheld and
paid
over under applicable laws.
(g) Parent
has never been a “United States real property holding company” (as such term is
defined in Section 897(c)(2) of the Code).
(h) No
power
of attorney with respect to any Taxes has been executed or filed with any Taxing
Authority by or on behalf of Parent.
(i) As
of the
date of this Agreement it is the present intention, and as of the date of the
Closing it will be the present intention, of Parent to continue, either in
the
form of Tikvah as a wholly owned subsidiary of Parent or through a member of
Parent’s “qualified group” (as defined in Regulations Section 1.368 1(d)(4)), at
least one significant historic business line of Tikvah, or to use at least
a
significant portion of Tikvah’s historic business assets in a business, in each
case within the meaning of Regulations Section 1.368 1(d). As of the date of
the
Merger, (i) Parent will own all of the outstanding stock or other equity
interests in ▇▇▇▇▇▇▇ Merger Sub, and (ii) Parent will be in “control” of ▇▇▇▇▇▇▇
Merger Sub within the meaning of Code Section 368(c). Parent has no plan or
present intention to sell, transfer or otherwise dispose of any of the stock
of
Tikvah following the Merger, and Parent has no present plan or intention to
cause Tikvah to issue additional stock following the Merger, that in either
case
would result in Parent’s not having “control” of Tikvah within the meaning of
Code Section 368(c).
(j) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub has taken or agreed to take any action or failed
to take any action that would prevent the Merger from constituting
reorganization within the meaning of Section 368(a) of the Code.
3.8. Patents
and Trademarks.
Parent
has no patents, trademarks, licenses, sublicenses, or any agreement relating
to
the ownership of use of any intellectual property.
3.9. Compliance;
Permits; Restrictions.
(a) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub is in conflict with, or in default or violation
of
(i) any law, rule, regulation, order, judgment or decree applicable to Parent
or
▇▇▇▇▇▇▇ Merger Sub or by which its or any of their respective properties is
bound or affected, or (ii) any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which Parent or ▇▇▇▇▇▇▇ Merger Sub is a party or by which Parent or ▇▇▇▇▇▇▇
Merger Sub or its or any of their respective properties is bound or affected
except for those conflicts, defaults or violations which would not be reasonably
expected to have a Parent Material Adverse Effect. To the knowledge of Parent,
no investigation or review by any Governmental Entity is pending or threatened
against Parent or ▇▇▇▇▇▇▇ Merger Sub, nor has any Governmental Entity indicated
in writing an intention to conduct the same, other than those which would not
reasonably be expected to have a Parent Material Adverse Effect. There is no
agreement, judgment, injunction, order or decree binding upon Parent or ▇▇▇▇▇▇▇
Merger Sub which has or would reasonably be expected to have the effect of
prohibiting or materially impairing any business practice of Parent or ▇▇▇▇▇▇▇
Merger Sub, any acquisition of material property by Parent or ▇▇▇▇▇▇▇ Merger
Sub
or the conduct of business by Parent as currently conducted.
13
(b) Parent
and ▇▇▇▇▇▇▇ Merger Sub hold all permits, licenses, variances, exemptions, orders
and approvals from Governmental Entities which are necessary to the conduct
of
the business of Parent except those the absence of which would not, individually
or in the aggregate, be reasonably likely to have a Parent Material Adverse
Effect, (collectively, the “Parent Permits”). Parent and ▇▇▇▇▇▇▇ Merger Sub are
in compliance in all material respects with the terms of the Parent
Permits.
3.10. Litigation.
As of
the date of this Agreement, there is no action, suit, proceeding, claim,
arbitration or investigation pending, including derivative suits brought by
or
on behalf of Parent, nor, to Parent’s knowledge, threatened, against Parent or
▇▇▇▇▇▇▇ Merger Sub.
3.11. Brokers’
and Finders’ Fees.
Parent
has not incurred, nor will it incur, directly or indirectly, any liability
for
brokerage or finders’ fees or agents’ commissions or any similar charges in
connection with this Agreement or any transaction contemplated
hereby.
3.12. Labor
Agreements and Actions, Employee Benefit Plans.
(a) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub is bound by or subject to (and none of their
assets or properties is bound by or subject to) any written or oral, express
or
implied, contract, commitment or arrangement with any labor union, and no labor
union has requested or, to the knowledge of Parent, has sought to represent
any
of the employees, representatives, or agents of Parent or ▇▇▇▇▇▇▇ Merger Sub.
There is no strike or other labor dispute involving Parent or ▇▇▇▇▇▇▇ Merger
Sub
pending or, to the knowledge of Parent, threatened, nor is Parent aware of
any
labor organization activity involving its employees.
(b) Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub has ever sponsored, maintained, contributed to
or
had any liabilities or responsibilities for, any pension, profit-sharing or
other retirement, bonus, deferred compensation, employment agreement, severance
agreement, compensation, stock purchase, stock option, severance or termination
pay, hospitalization or other medical, life or other insurance, long- or
short-term disability, fringe benefit, sick pay, or vacation pay, or other
employee benefit plan, program, agreement, or arrangement or policy.
(c) There
are
no employment agreements for any officers or employees of Parent.
3.13. Absence
of Liens and Encumbrances.
Each of
Parent and ▇▇▇▇▇▇▇ Merger Sub has good and valid title to, or, in the case
of
leased properties and assets, valid leasehold interests in, all of its tangible
properties and assets, real, personal and mixed, used in its business, free
and
clear of any liens and encumbrances except (i) as reflected in the Parent
Financial Statements, (ii) for liens for taxes not yet due and payable and
(iii)
for such imperfections of title and encumbrances, if any, which would not be
reasonably expected to have a Parent Material Adverse Effect.
14
3.14. Environmental
Matters.
Neither
Parent nor ▇▇▇▇▇▇▇ Merger Sub has conducted any activity which could give rise
to any environmental liability.
3.15. Agreements.
Parent
is not a party to any written or oral agreements, except that Parent has entered
into retainer and engagement agreements with its audit and legal professionals
in the ordinary course of its business.
3.16. Board
Approval.
The
Board of Directors of each of Parent and ▇▇▇▇▇▇▇ Merger Sub has, as of the
date
of this Agreement, (i) determined that the Merger is fair to, advisable and
in
the best interests of it and its stockholders and (ii) duly approved the Merger,
this Agreement and the transactions contemplated hereby.
3.17. Valid
Issuances.
The
Tikvah Merger Consideration to be issued by Parent in the Merger, when issued
in
accordance with the provisions of this Agreement, will be duly authorized,
validly issued, full paid and nonassessable, free of all liens and encumbrances
and not subject to preemptive rights and, subject to receipt of complete and
executed investor questionnaires from each holder of Tikvah capital stock,
will
be exempt from the registration requirements of the Securities Act and
applicable blue sky laws.
ARTICLE
IV
CONDUCT
PRIOR TO THE EFFECTIVE TIME
4.1. Conduct
of Business by the Parties.
During
the period from the date of this Agreement and continuing until the earlier
of
the termination of this Agreement pursuant to its terms or the Effective Time,
each of Tikvah and Parent shall carry on their respective business in the
ordinary course and in substantial compliance with all applicable laws and
regulations.
4.2. Covenants
of Parent.
Except
as permitted by the terms of this Agreement, without the prior written consent
of Tikvah, during the period from the date of this Agreement and continuing
until the earlier of the termination of this Agreement pursuant to its terms
or
the Effective Time, Parent shall not do any of the following and shall not
permit ▇▇▇▇▇▇▇ Merger Sub to do any of the following:
(a) Enter
into, amend or terminate any agreement with any third party;
(b) Declare,
set aside or pay any dividends on or make any other distributions (whether
in
cash, stock, equity securities or property) in respect of any capital stock
or
split, combine or reclassify any capital stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for any capital stock;
(c) Issue,
authorize or deal in any securities of Parent or ▇▇▇▇▇▇▇ Merger
Sub;
(d) Except
as
required by GAAP, revalue any of its assets or make any change in accounting
methods, principles or practices;
15
(e) Make
any
Tax election or accounting method change (except as required by GAAP)
inconsistent with past practice that, individually or in the aggregate, is
reasonably likely to adversely affect in any material respect the Tax liability
or Tax attributes of Parent or ▇▇▇▇▇▇▇ Merger Sub, settle or compromise any
material Tax liability or consent to any extension or waiver of any limitation
period with respect to Taxes; or
(f) Take
any
action that would prevent the Merger from qualifying as a reorganization under
Section 368(a) of the Code.
4.3. Covenants
of Tikvah.
During
the period from the date of this Agreement and continuing until the earlier
of
the termination of this Agreement pursuant to its terms or the Effective Time,
Tikvah shall not (i) amend the Tikvah charter documents, (ii) split, combine
or
reclassify its outstanding shares of capital stock, (iii) declare, set aside
or
pay any dividend payable in cash, stock or property in respect of any capital
stock, (iv) take any action that would prevent the Merger from qualifying as
a
reorganization under Section 368(a) of the Code, (v) conduct its business,
other
than in the ordinary course consistent with past practices, or as contemplated
by this Agreement or (vi) issue any capital stock or any options, warrants
or
other rights to subscribe for or purchase any capital stock or any securities
convertible into or exchangeable or exercisable for, or rights to purchase
or
otherwise acquire, any shares of the capital stock of Tikvah, except as
contemplated by the Memorandum.
4.4. Use
of
Proceeds.
Tikvah
shall use proceeds from the Offering in the manner described in the
Memorandum.
ARTICLE
V
ADDITIONAL
AGREEMENTS
5.1. Public
Disclosure; Securities Law Filings.
Parent
and Tikvah will consult with each other, and to the extent practicable, agree,
before issuing any press release or otherwise making any public statement with
respect to the Merger or this Agreement and will not issue any such press
release or make any such public statement prior to such consultation, except
as
may be required by law or any listing agreement with a national securities
exchange, in which case reasonable efforts to consult with the other party
will
be made prior to such release or public statement. The parties will agree to
the
text of the joint press release announcing the signing of this Agreement. In
addition, Parent and Tikvah agree to cooperate in the preparation and filing
of
all filings required by applicable securities laws, including, without
limitation, current reports on Form 8-K and information required by Rule 14f-1
under the Exchange Act.
5.2. Commercially
Reasonable Efforts; Notification.
(a) Upon
the
terms and subject to the conditions set forth in this Agreement, each of the
parties agrees to use commercially reasonable efforts to take, or cause to
be
taken, all actions, and to do, or cause to be done, and to assist and cooperate
with the other parties in doing, all things necessary, proper or advisable
to
consummate and make effective, in the most expeditious manner practicable,
the
Merger and the other transactions contemplated by this Agreement.
16
(b) Parent
shall give prompt notice to Tikvah upon becoming aware that any representation
or warranty made by it or ▇▇▇▇▇▇▇ Merger Sub contained in this Agreement has
become untrue or inaccurate, or of any failure of Parent or ▇▇▇▇▇▇▇ Merger
Sub
to comply with or satisfy in any material respect any covenant, condition or
agreement to be complied with or satisfied by it under this Agreement, in each
case, where the conditions set forth in Section 6.2(a) or Section 6.2(b) would
not be satisfied as a result thereof; provided, however, that no such
notification shall affect the representations, warranties, covenants or
agreements of the parties or the conditions to the obligations of the parties
under this Agreement.
(c) Tikvah
shall give prompt notice to Parent upon becoming aware that any representation
or warranty made by it contained in this Agreement has become untrue or
inaccurate, or of any failure of Tikvah to comply with or satisfy in any
material respect any covenant, condition or agreement to be complied with or
satisfied by it under this Agreement, in each case, where the conditions set
forth in Section 6.3(a) or Section 6.3(b) would not be satisfied as a result
thereof; provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the parties or the
conditions to the obligations of the parties under this Agreement.
5.3. Third
Party Consents.
On or
before the Closing Date, Parent and Tikvah will each use its commercially
reasonable efforts to obtain any consents, waivers and approvals under any
of
its respective agreements, contracts, licenses or leases required to be obtained
in connection with the consummation of the transactions contemplated
hereby.
5.4. Parent
Board of Directors.
At the
Effective Time, the Board of Directors of Parent, in accordance with applicable
law and the Charter Documents, shall take all necessary action (which action
will include the resignation of all existing directors) to appoint each of
the
existing directors of Tikvah as directors of Parent and resign as
directors.
5.5. Parent
Management.
At the
Effective Time, the Board of Directors of Parent, in accordance with applicable
law and the Charter Documents shall take all necessary action to appoint the
officers of Tikvah to the similar offices of Parent. At the Effective Time,
all
officers of Parent shall resign from their offices.
ARTICLE
VI
CONDITIONS
TO THE MERGER
6.1. Conditions
to Obligations of Each Party to Effect the Merger.
The
respective obligations of each party to this Agreement to effect the Merger
shall be subject to the satisfaction at or prior to the Closing Date of the
following conditions, any of which may be waived in writing by both Parent
and
Tikvah:
(a) Stockholder
Approval. This Agreement shall have been adopted and the Merger shall have
been
duly approved by the requisite vote under applicable law and the Tikvah charter
documents by the stockholders of Tikvah, and Tikvah stockholders holding less
than 3% of the Tikvah Common Stock shall have exercised appraisal rights under
the DGCL;
(b) No
Order.
No Governmental Entity shall have enacted, issued, promulgated, enforced or
entered any statute, rule, regulation, executive order, decree, injunction
or
other order (whether temporary, preliminary or permanent) which is in effect
and
which has the effect of making the Merger illegal or otherwise prohibiting
consummation of the Merger;
17
(c) Officers’
Certificate. Each party shall have furnished to the other an officer’s dated as
of the Effective Date, in which such officer shall certify that the conditions
set forth in Sections 6.1, 6.2 or 6.3 (as applicable) have been fulfilled and
are true and correct;
6.2. Additional
Conditions to Obligations of Tikvah.
The
obligation of Tikvah to effect the Merger shall be subject
to the
satisfaction at or prior to the Closing Date of each of the following
conditions, any of which may be waived, in writing, exclusively by
Tikvah:
(a) Representations
and Warranties. The representations and warranties of Parent and ▇▇▇▇▇▇▇ Merger
Sub set forth in this Agreement shall be true and correct as of the date of
this
Agreement and as of the Closing Date as if made on and as of the Closing Date
(except to the extent any such representation and warranty expressly speaks
as
of an earlier date) and Tikvah shall have received a certificate signed on
behalf of Parent by an officer of Parent to such effect;
(b) Agreements
and Covenants. Each of Parent and ▇▇▇▇▇▇▇ Merger Sub shall have performed or
complied with, in all material respects, all agreements and covenants required
by this Agreement to be performed or complied with by them on or prior to the
Closing Date, and Tikvah shall have received a certificate to such effect signed
on behalf of each of Parent and ▇▇▇▇▇▇▇ Merger Sub by an authorized officer
of
each and ▇▇▇▇▇▇▇ Merger Sub shall have been validly formed;
(c) No
Closing Material Adverse Effect. Since the date hereof, there has not occurred
a
Parent Material Adverse Effect. For purposes of the preceding sentence and
Section 6.2(a), the occurrence of any of the following events or circumstances,
in and of themselves and in combination with any of the others, shall not
constitute a Parent Material Adverse Effect:
(1) any
litigation or threat of litigation filed or made after the date hereof
challenging any of the transactions contemplated herein or any stockholder
litigation or threat of stockholder litigation filed or made after the date
hereof resulting from this Agreement or the transactions contemplated herein
unless Tikvah shall conclude that it has or could have a Material Adverse Effect
on the Parent and Tikvah Surviving Corporation, taken as a whole;
and
(2) any
adverse change, event or effect that is demonstrated to be caused primarily
by
conditions generally affecting the United States economy.
(d) Other
Agreements and Resignations. Each of the officers and directors of Parent and
▇▇▇▇▇▇▇ Merger Sub immediately prior to the Closing Date shall deliver duly
executed resignations from their positions with each such applicable corporation
immediately upon the Closing Date;
(e) Compliance
with Securities Law Requirements. Parent shall be in compliance in all material
respects with all requirements of applicable securities laws, including, without
limitation, the filing of reports required by Section 13 of the Exchange Act,
and shall have taken all actions with respect thereto as shall be required
or
reasonably requested by Tikvah in connection therewith; and
18
(f) Minimum
Financing. Tikvah shall have closed on at least $30,000,000 of gross cash
proceeds from the sale of the Tikvah Common Stock (the
“Financing”).
6.3. Additional
Conditions to the Obligations of Parent and ▇▇▇▇▇▇▇ Merger Sub.
The
obligations of Parent and ▇▇▇▇▇▇▇ Merger Sub to effect the Merger shall be
subject to the satisfaction at or prior to the Closing Date of each of the
following conditions, any of which may be waived, in writing, exclusively by
Parent:
(a) Representations
and Warranties. The representations and warranties of Tikvah set forth in this
Agreement shall be true and correct as of the date of this Agreement and as
of
the Closing Date as if made on and as of the Closing Date (except to the extent
any such representation and warranty expressly speaks as of an earlier date)
and
Parent shall have received a certificate signed on behalf of Tikvah by an
officer of Tikvah to such effect; provided, however, that notwithstanding
anything herein to the contrary, this Section 6.3(a) shall be deemed to have
been satisfied even if such representations or warranties are not so true and
correct unless the failure of such representations or warranties to be so true
and correct, individually or in the aggregate, has had, or is reasonably likely
to have, a Tikvah Material Adverse Effect;
(b) Agreements
and Covenants. Tikvah shall have performed or complied with, in all material
respects, all agreements and covenants required by this Agreement to be
performed or complied with by it at or prior to the Closing Date, and Parent
shall have received a certificate to such effect signed on behalf of Tikvah
by
an authorized officer of Tikvah.
(c) Minimum
Financing. Tikvah shall have consummated the Financing;
(d) No
Closing Material Adverse Effect. Since the date hereof, there has not occurred
a
Tikvah Material Adverse Effect. For purposes of the preceding sentence and
Section 6.3(a), the occurrence of any of the following events or circumstances,
in and of themselves and in combination with any of the others, shall not
constitute a Tikvah Material Adverse Effect:
(1) any
litigation or threat of litigation filed or made after the date hereof
challenging any of the transactions contemplated herein or any stockholder
litigation or threat of stockholder litigation filed or made after the date
hereof resulting from this Agreement or the transactions contemplated herein
unless Parent and ▇▇▇▇▇▇▇ Merger Sub, together, shall conclude that it has
or
could have a Material Adverse Effect on the Parent and Tikvah Surviving
Corporation, taken as a whole; and
(2) any
adverse change, event or effect that is demonstrated to be caused primarily
by
conditions generally affecting the United States economy.
(e) Audited
Financial Statements. Tikvah shall have obtained such audited financial
statements that are required to be filed with the SEC as an exhibit to the
Current Report of Parent on Form 8-K, available on or before
Closing.
19
ARTICLE
VII
TERMINATION,
AMENDMENT AND WAIVER
7.1. Termination.
This
Agreement may be terminated at any time prior to the Effective Time, whether
before or after the requisite approval of the stockholders of
Tikvah:
(a) by
mutual
written consent duly authorized by the Boards of Directors of Parent and Tikvah;
or
(b) by
either
Parent or Tikvah if the Merger shall not have been consummated by December
31,
2007, which date will be automatically extended for up to 60 days if the
expiration of the Financing shall have been extended (such date, being the
“Outside Date”).
(c) by
either
Parent or Tikvah if a Governmental Entity shall have issued an order, decree
or
ruling or taken any other action, in any case having the effect of permanently
restraining, enjoining or otherwise prohibiting the Merger, which order, decree,
ruling or other action shall have become final and nonappealable or any law,
order, rule or regulation is in effect or is adopted or issued, which has the
effect of prohibiting the Merger; or
(d) by
Parent, on the one hand, or Tikvah, on the other, if any condition to the
obligation of any such party to consummate the Merger set forth in Section
6.2
(in the case of Tikvah) or 6.3 (in the case of Parent) becomes incapable of
satisfaction prior to the Outside Date; provided, however, that the failure
of
such condition is not the result of a breach of this Agreement by the party
seeking to terminate this Agreement.
7.2. Fees
and Expenses.
All
Expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such Expenses whether
or not the Merger is consummated. As used in this Agreement, “Expenses” shall
include all reasonable out-of-pocket expenses (including, without limitation,
all fees and expenses of counsel, accountants, experts and consultants to a
party hereto and its affiliates) incurred by a party or on its behalf in
connection with or related to the authorization, preparation, negotiation,
execution and performance of this Agreement and all other matters relating
to
the closing of the Merger and the other transactions contemplated
hereby.
7.3. Amendment.
This
Agreement may not be amended by the parties hereto except by execution of an
instrument in writing signed on behalf of each of Parent, Tikvah and ▇▇▇▇▇▇▇
Merger Sub.
7.4. Extension;
Waiver.
At any
time prior to the Effective Time, any party hereto may, to the extent legally
allowed, (i) extend the time for the performance of any of the obligations
or
other acts of the other parties hereto, (ii) waive any inaccuracies in the
representations and warranties made to such party contained herein or in any
document delivered pursuant hereto and (iii) waive compliance with any of the
agreements or conditions for the benefit of such party contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall
be
valid only if set forth in an instrument in writing signed on behalf of such
party. Delay in exercising any right under this Agreement shall not constitute
a
waiver of such right.
20
ARTICLE
VIII
CONTINUATION
OF BUSINESS
Parent,
either directly or through Tikvah as long as Tikvah is within Parent’s
“qualified group” within the meaning of Regulations Section 1.368-1(d)(4)(ii)
(the “Qualified Group”), plans to continue at least one significant historic
business line of Tikvah, and use a significant portion of Tikvah’s historic
business assets in a business, in each case within the meaning of Regulations
Section 1.368-1(d).
ARTICLE
IX
GENERAL
PROVISIONS
9.1. Notices.
All
notices and other communications hereunder shall be in writing and shall be
deemed given on the day of delivery if delivered personally or sent via telecopy
(receipt confirmed) or on the second business day after being sent if delivered
by commercial delivery service, to the parties at the following addresses or
telecopy numbers (or at such other address or telecopy numbers for a party
as
shall be specified by like notice):
(a) if
to
Parent or ▇▇▇▇▇▇▇ Merger Sub:
▇▇▇▇▇▇▇
Sciences, Inc.
c/o
Paramount BioSciences, LLC
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
(b) if
to
Tikvah:
Tikvah
Therapeutics, Inc.
▇▇
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
Attn:
▇▇.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
With
a
copy to:
▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
Attn:
W.
▇▇▇▇▇ Mannheim, Esq.
9.2. Counterparts.
This
Agreement may be executed in one or more counterparts, all of which shall be
considered one and the same agreement.
9.3. Entire
Agreement; Third Party Beneficiaries.
This
Agreement and the documents and instruments and other agreements among the
parties hereto as contemplated by or referred to herein constitute the entire
agreement among the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, both written and oral, among
the parties with respect to the subject matter hereof. Nothing in this Agreement
is intended to or shall confer upon any other person any right, benefit or
remedy of any nature whatsoever under or by reason of this
Agreement.
21
9.4. Severability.
In the
event that any provision of this Agreement, or the application thereof, becomes
or is declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of this Agreement will continue in full force
and
effect and the application of such provision to other persons or circumstances
will be interpreted so as reasonably to effect the intent of the parties hereto.
The parties further agree to replace such void or unenforceable provision of
this Agreement with a valid and enforceable provision that will achieve, to
the
extent possible, the economic, business and other purposes of such void or
unenforceable provision.
9.5. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware, without regard to principles of conflicts of law
thereof.
9.6. Assignment.
No
party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of the other parties.
Subject to the preceding sentence, this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
9.7. Waiver
of Jury Trial.
EACH OF
PARENT, TIKVAH AND ▇▇▇▇▇▇▇ MERGER SUB HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE
ACTIONS OF PARENT, TIKVAH AND ▇▇▇▇▇▇▇ MERGER SUB IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.
[Remainder
of page is blank; signatures follow]
22
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement and Plan of
Merger to be executed by their duly authorized respective officers as of the
date first written above.
| ▇▇▇▇▇▇▇ Sciences, Inc. | |||
| By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||
|
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ |
|||
|
Title:
President
|
| Tikvah Therapeutics, Inc. | |||
| By: /s/ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |||
|
Name: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ |
|||
|
Title:
Chief Executive Officer
|
| ▇▇▇▇▇▇▇ Acquisition Corp. | |||
| By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||
|
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ |
|||
|
Title: President
|
23