COMPANY NAME: ZOETIS INC.
HEADLINE: ZOETIS TO ACQUIRE NEXVET FOR US$85 MILLION
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART)
IN, INTO OR FROM ANY RESTRICTED JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION
FOR IMMEDIATE RELEASE
13 April 2017
ZOETIS TO ACQUIRE NEXVET FOR US$6.72 IN CASH PER SHARE
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Acquisition strengthens Zoetis’ R&D pipeline in biologics, including
monoclonal antibodies for pain and other therapeutic areas in
companion animals.
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Zoetis continues investing in emerging areas to fuel future growth and
sustain its leadership in animal health.
Parsippany, New Jersey, US and Tullamore, Ireland 13 April 2017 –
Zoetis Inc. (“Zoetis”) (NYSE: ZTS) and Nexvet Biopharma plc (“Nexvet”)
(NASDAQ: NVET) today announced an agreement on the terms of a
recommended offer to be made by Zoetis, through a wholly-owned
subsidiary, for all of the issued and to be issued ordinary shares of
Nexvet for US$6.72 in cash per ordinary share, which values the entire
issued and to be issued ordinary share capital of Nexvet at
approximately US$85 million (the “Acquisition”). This per share
purchase price represents a 66% premium over Nexvet’s 12 April 2017
Closing Price, a 71% premium over Nexvet’s one month volume weighted
average price per share and an 87% premium over Nexvet’s three month
volume weighted average price per share. The board of directors of
Nexvet has unanimously approved the Acquisition, which is being
implemented by means of a scheme of arrangement under Irish law. The
Acquisition is subject to approval by Nexvet’s shareholders and the
Irish High Court and other customary conditions, and it is currently
expected that the Acquisition will be completed during the second half
of this calendar year.
Nexvet is a biologic therapeutics company with a pipeline of monoclonal
antibody (mAb) therapies being developed for companion animals in pain
and other therapeutic areas. This acquisition strengthens Zoetis’
research and development pipeline and will broaden its portfolio of
solutions for pain. The global market for companion animal pain
therapeutics is currently estimated at approximately $400 million
annually.
Nexvet’s pipeline product ranevetmab (a mAb targeting nerve-growth
factor (NGF)) for pain treatment for dogs would, upon approval, be the
industry’s first monoclonal antibody therapy administered monthly by
injection for chronic pain. It would be a highly differentiated
alternative to Zoetis’ daily oral therapy Rimadyl®
(carprofen), the first non-steroidal anti-inflammatory (NSAID) product
originally approved in 1997 to treat arthritis pain and inflammation in
dogs. In addition, Nexvet’s feline-specific injectable mAb (frunevetmab,
also a mAb targeting NGF) could open up a new opportunity in feline pain
that is underserved today.
Nexvet’s platform technology, which it refers to as “PETization”, is an
algorithmic approach that enables Nexvet to rapidly create monoclonal
antibodies, a type of biologic, that are designed to be recognised as
“self” or “native” by an animal’s immune system, a property referred to
as “100% species-specificity”. PETization is designed to build upon the
safety and efficacy data from clinically tested human therapies to
create new therapies for companion animals, which is intended to reduce
clinical risk and development cost.
Zoetis continues to allocate its capital judiciously through a mix of
internal R&D and business development activities to grow its business
and create value for shareholders.
1. Terms of the Acquisition
1.1 Under the terms of the proposed acquisition, which has been
unanimously approved by the board of directors of Nexvet, Nexvet
Shareholders will receive US$6.72 in cash per ordinary share which
values the entire issued and to be issued ordinary share capital of
Nexvet at approximately US$85 million. The purchase price represents a
66% premium over Nexvet’s Closing Price on 12 April 2017, a 71% premium
over Nexvet’s one month volume weighted average price per share, and an
87% premium over Nexvet’s three month volume weighted average price per
share.
1.2 The Consideration payable by Zoetis under the terms of the
Acquisition will be funded by cash on hand and Zoetis Bidco’s own
financial resources.
1.3 The Nexvet board of directors, who have been so advised by Evercore
as to the financial terms of the Acquisition, consider the terms of the
Acquisition to be fair and reasonable. In providing its advice to the
Nexvet Directors, Evercore, has taken into account the commercial
assessments of the Nexvet Directors.
1.4 Accordingly, the Nexvet Directors unanimously recommend that Nexvet
Shareholders vote in favour of the resolutions relating to the
Acquisition at the relevant shareholder and scheme meetings.
1.5 It is intended that the Acquisition will be implemented by means of
a scheme of arrangement under Chapter 1 of Part 9 of the Irish Companies
Act 2014. It is intended that the Scheme Document, which will form part
of the Proxy Statement filed by Nexvet with the SEC containing the full
terms and conditions of the Acquisition (including notices of the
shareholder and scheme meetings), will, along with the balance of the
Proxy Statement, be mailed as soon as possible after the date of this
Announcement to Nexvet Shareholders, and, for information only, to
holders of Nexvet Convertible Securities. The Proxy Statement, including
the Scheme Document, will be made available by Nexvet at www.nexvet.com.
1.6 The Acquisition will be put to Nexvet Shareholders at both the
Scheme Meeting and the EGM. In order to become effective, the Scheme
must be approved by a majority in number of Nexvet Shareholders voting
at the Scheme Meeting, either in person or by proxy, representing at
least 75% in value of Nexvet Shares voted in each relevant share class.
In addition, shareholder resolutions implementing the Scheme, approving
the related reduction of share capital and adopting certain changes to
Nexvet’s articles of association must be approved by Nexvet
shareholders, certain of which will require at least 75% of votes cast
at the EGM.
1.7 The Acquisition is conditional, among other things, on the
satisfaction or waiver of the conditions set out in Schedule 1. The
Scheme will also require the sanction of the Irish High Court. Subject
to the satisfaction, or where relevant waiver, of all relevant
conditions and the sanction of the Irish High Court, it is currently
expected that the Scheme will become effective and the Acquisition will
be completed during the second half of this calendar year. An expected
timetable of principal events will be included in the Scheme Document.
1.8 If the Scheme becomes effective, it will be binding on all Nexvet
Shareholders, irrespective of whether or not they attended and/or voted
at the Scheme Meeting or EGM (and if they attended and voted, whether or
not they voted in favour).
1.9 Zoetis and Zoetis Bidco have received irrevocable undertakings from
Christopher Brown, George Gunn, Ashraf Hanna, Mark Heffernan, Cormac
Kilty, Joseph McCracken, Rajiv Patel and John Payne, being members of
the Nexvet Board, that they will vote in favour of the matters and
resolutions to be considered at the Scheme Meeting and EGM in their
capacity as shareholders (or, in the event that, subject to the terms of
the Transaction Agreement and with the consent of the Panel, the
Acquisition is implemented by way of a takeover offer on terms and
conditions at least as favourable, in aggregate, as the Scheme, to
accept the offer or procure acceptance of the offer) in respect of their
entire beneficial holdings of Nexvet Shares amounting to, in aggregate,
543,813 Nexvet Shares, representing approximately 4.6% of the issued and
outstanding ordinary share capital of Nexvet on 12 April 2017 (being the
last practicable date prior to the publication of this Announcement).
1.10 In addition, Zoetis and Zoetis Bidco have received irrevocable
undertakings from certain other Nexvet Shareholders, namely Farallon
Capital Management LLC (acting through related companies), Adage Capital
Partners GP LLC and Broadfin Capital LLC that they will vote in favour
of the matters and resolutions to be considered at the Scheme Meeting
and the EGM (or, in the event that, subject to the terms of the
Transaction Agreement and with the consent of the Panel, the Acquisition
is implemented by way of a takeover offer on terms and conditions at
least as favourable, in aggregate, as the Scheme, to accept the offer or
procure acceptance of the offer) in respect of their entire beneficial
holdings of Nexvet Shares amounting to, in aggregate, 4,570,896 Nexvet
Shares, representing approximately 38.4% of the issued and outstanding
ordinary share capital of Nexvet on 12 April 2017 (being the last
practicable date prior to the publication of this Announcement).
This summary should be read in conjunction with, and is subject to,
the full text of the attached Announcement (including its appendices). The
Acquisition is subject to the conditions set out in Schedule 1 to this
Announcement and the further terms to be set out in the Scheme Document.
The sources and bases of information contained in this Announcement are
set out in Schedule 2. Certain definitions and expressions used in this
Announcement are set out in Schedule 3. Finally, a copy of the
Transaction Agreement is set out at Schedule 4.
Rule 30.2 of the Takeover Rules requires that, except with the consent
of the Panel, and subject to Rule 2.7 of the Takeover Rules, Nexvet must
dispatch the Scheme Document to Nexvet Shareholders within 28 days of
the announcement of a firm intention to make an offer, being this
Announcement.
On 12 April 2017, the Panel agreed to grant the Parties a derogation
from Rule 30.2.
There is a requirement to file the Proxy Statement (which will also
contain the Scheme Document) with the SEC in connection with the Scheme.
The preparation of the Proxy Statement may take more than 28 days. Also,
the SEC may elect to review the Proxy Statement prior to declaring it
effective. This review process may take 60 days or more to complete.
Under SEC rules, the Proxy Statement cannot be dispatched to Nexvet
Shareholders until the Proxy Statement is declared effective by the SEC.
The Panel granted the derogation on the basis that the Scheme Document
cannot be dispatched until the Proxy Statement is declared effective by
the SEC. The Scheme Document will be dispatched to Nexvet Shareholders
as soon as practicable after the Proxy Statement is declared effective.
Publication on Website
A copy of the Announcement will be made available by Zoetis on its
website free of charge, subject to certain restrictions relating to
persons in Restricted Jurisdictions, at www.zoetis.com/news-and-media
by no later than 12 noon (Eastern Time), on 14 April 2017. Nexvet will
also make the Announcement and the documents required to be published
pursuant to the Takeover Rules by Nexvet available on its website free
of charge, subject to certain restrictions relating to persons in
Restricted Jurisdictions, at www.nexvet.com
by no later than 12 noon (Eastern Time), on 14 April 2017.
2. Contact Information
3. About Zoetis
Zoetis (NYSE: ZTS) is the leading animal health company, dedicated to
supporting its customers and their businesses. Building on more than 60
years of experience in animal health, Zoetis discovers, develops,
manufactures and markets veterinary vaccines and medicines, complemented
by diagnostic products, genetic tests, biodevices and a range of
services. Zoetis serves veterinarians, livestock producers and people
who raise and care for farm and companion animals with sales of its
products in more than 100 countries. In 2016, Zoetis generated annual
revenue of US$4.9 billion with approximately 9,000 employees. For more
information, visit www.zoetis.com.
4. About Nexvet
Nexvet (NASDAQ: NVET) is a clinical-stage biopharmaceutical company
focused on transforming the therapeutic market for companion animals,
such as dogs and cats, by developing and commercialising novel,
species-specific biologics. Nexvet’s platform technology, which it
refers to as “PETization”, is an algorithmic approach that enables
Nexvet to rapidly create monoclonal antibodies ("mAbs") a type of
biologic that are designed to be recognised as “self” or “native” by an
animal’s immune system, a property referred to as “100%
species-specificity”. PETization is designed to build upon the safety
and efficacy data from clinically tested human therapies to create new
therapies for companion animals, which is intended to reduce clinical
risk and development cost.
Nexvet is leveraging diverse global expertise and incentives to build a
vertically integrated biopharmaceutical company, which conducts drug
discovery in Australia, conducts clinical development in the United
States and Europe and conducts manufacturing in Ireland.
5. Zoetis and Nexvet Advisers
Zoetis and Zoetis Bidco’s financial adviser is Goldman Sachs. Morgan,
Lewis & Bockius LLP, New York and Arthur Cox, Dublin are providing legal
advice.
Nexvet’s co-lead advisers are Evercore, which is acting as financial
adviser to Nexvet, including for the purposes of Rule 3 of the Takeover
Rules, and Cowen, which is acting as financial adviser to Nexvet.
DLA Piper, Seattle and Matheson, Dublin are providing legal advice.
5.1 Responsibility for this Announcement
(a) The directors of Zoetis and the directors of Zoetis Bidco accept
responsibility for the information contained in this Announcement other
than the information relating to Nexvet, and the directors of Nexvet and
members of their immediate families, related trusts and persons
connected with them. To the best of the knowledge and belief of the
directors of Zoetis and the directors of Zoetis Bidco (who have taken
reasonable care to ensure that such is the case), the information
contained in this Announcement for which they accept responsibility is
in accordance with the facts and does not omit anything likely to affect
the import of such information.
(b) The directors of Nexvet accept responsibility for the information
contained in this Announcement relating to Nexvet and the directors of
Nexvet and members of their immediate families, related trusts and
persons connected with them. To the best of the knowledge and belief of
the directors of Nexvet (who have taken all reasonable care to ensure
that such is the case), the information contained in this Announcement
for which they accept responsibility is in accordance with the facts and
does not omit anything likely to affect the import of such information.
(c) Goldman Sachs, which is authorised by the Prudential Regulation
Authority and regulated by the Financial Conduct Authority and the
Prudential Regulation Authority in the United Kingdom, is acting as
financial adviser exclusively for Zoetis and Zoetis Bidco and no one
else in connection with the Acquisition and the other matters referred
to in this Announcement, and will not regard any other person as its
client in relation to the Acquisition and the other matters referred to
in this Announcement and will not be responsible to anyone other than
Zoetis and Zoetis Bidco for providing the protections afforded to
clients of Goldman Sachs, nor for providing advice in relation to the
Acquisition or the other matters referred to in this Announcement.
(d) Evercore, which is authorised and regulated in the United Kingdom by
the Financial Conduct Authority, is acting as financial adviser for
Nexvet, including for the purposes of Rule 3 of the Takeover Rules, and
no one else in connection with the Acquisition and the other matters
referred to in this Announcement, and will not regard any other person
as its client in relation to the Acquisition and the other matters
referred to in this Announcement and will not be responsible to anyone
other than Nexvet for providing the protections afforded to clients of
Evercore, nor for providing advice in relation to the Acquisition or the
other matters referred to in this Announcement. Neither Evercore nor any
of its subsidiaries, branches or affiliates owes or accepts any duty,
liability or responsibility whatsoever (whether direct or indirect,
whether in contract, in tort, under statute or otherwise) to any person
who is not a client of Evercore in connection with this Announcement,
any statement contained therein or otherwise.
(e) Cowen, which is a securities broker-dealer registered with the SEC
and subject to regulation by the SEC and FINRA, is acting as financial
adviser for Nexvet and for no one else in connection with the
Acquisition and the other matters referred to in this Announcement, and
will not be responsible to anyone other than Nexvet for providing the
protections afforded to clients of Cowen or for providing advice in
relation to the Acquisition and the other matters referred to in this
Announcement.
5.2 Important Information for U.S. Investors
(a)
Important Legal Information
.
In connection with the proposed transactions, Nexvet will prepare the
Proxy Statement (including the Scheme Document) to be filed with the
SEC. When completed, a definitive Proxy Statement and a form of proxy
will be mailed to the shareholders of Nexvet. BEFORE MAKING ANY VOTING
DECISION, NEXVET SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT
(INCLUDING THE SCHEME DOCUMENT) CAREFULLY AND IN ITS ENTIRETY BECAUSE IT
WILL CONTAIN IMPORTANT INFORMATION. Nexvet Shareholders will be able to
obtain, without charge, a copy of the Proxy Statement (when available)
and other relevant documents filed with the SEC from the SEC’s website
at http://www.sec.gov.
Nexvet Shareholders will also be able to obtain, without charge, a copy
of the Proxy Statement (including the Scheme Document) and other
relevant documents (when available) by directing a request by mail or
telephone to Geraldine Farrell, Unit 5, Sragh Technology Park, Rahan
Road, Tullamore, County Offaly, Ireland, Tel: +353 5793 24522, or from
Nexvet’s website, http://www.nexvet.com.
(b)
Participant Information
.
Information about Nexvet’s directors and executive officers who may be
deemed to participate in the solicitation of proxies in respect of the
proposed transaction is set forth in Nexvet’s Annual Report on Form 10-K
for the fiscal year ended 30 June 2016 and Nexvet’s proxy statement for
Nexvet’s 2016 annual meeting of shareholders. Nexvet Shareholders may
obtain additional information regarding the interests of Nexvet and its
directors and executive officers in the transactions, which may be
different than those of Nexvet Shareholders generally, by reading the
Proxy Statement (including the Scheme Document) and other relevant
documents regarding the proposed transactions, when filed with the SEC.
(c) Nexvet is incorporated under the laws of Ireland. Some or all of the
directors of Nexvet are resident in countries other than the United
States. As a result, it may not be possible for U.S. holders of Nexvet
Shares to effect service of process within the United States upon Nexvet
or such directors of Nexvet or to enforce against any of them U.S.
judgments predicated upon the civil liability provisions of the U.S.
securities laws. It may not be possible to sue Nexvet or its officers or
directors in a non-U.S. court for violations of U.S. securities laws.
5.3 Forward-looking statements
(a) Zoetis and Zoetis Bidco: This Announcement contains forward-looking
statements, which reflect the current views of Zoetis and Zoetis Bidco
with respect to business plans or prospects, future operating or
financial performance, future guidance, future operating models,
expectations regarding products, future use of cash and dividend
payments, tax rate and tax regimes, changes in the tax regimes and Laws
in other jurisdictions, and other future events. Forward-looking
statements are subject to risks and uncertainties. If one or more of
these risks or uncertainties materialize, or if management's underlying
assumptions prove to be incorrect, actual results may differ materially
from those contemplated by a forward-looking statement. Forward-looking
statements speak only as of the date on which they are made. Each of
Zoetis and Zoetis Bidco expressly disclaim any obligation to update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
(b) Nexvet: This Announcement contains forward-looking statements
including those regarding Nexvet’s future results of operations and
financial position, ability to access financing on acceptable terms or
at all, results of any current or future pivotal study, future
expenditures relating to lead product candidates, time for completion of
any of studies or facilities upgrades, ability to develop its pipeline
of product candidates, business strategy, prospective products, ability
to successfully manufacture its own product candidates, ability to meet
conditions for the receipt of government grants, time for regulatory
submissions, ability to qualify for conditional licensure or obtain
product approvals, research and development costs, timing and likelihood
of success, plans and objectives of management for future operations,
and future results of current and anticipated products. They also
reflect uncertainties as to whether Nexvet Shareholders will approve the
Acquisition, the possibility that competing offers may be made, or other
factors that could cause the Acquisition not to occur. These statements
are not guarantees of future performance or actions. Forward-looking
statements are subject to risks and uncertainties. If one or more of
these risks or uncertainties materialize, or if management's underlying
assumptions prove to be incorrect, actual results may differ materially
from those contemplated by a forward-looking statement. Forward-looking
statements speak only as of the date on which they are made. Nexvet
expressly disclaims any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
(c) Factors that could cause or contribute to such differences include,
but are not limited to: uncertainties as to the timing of the
Acquisition; uncertainties as to whether Zoetis or Zoetis Bidco will be
able to consummate the Acquisition; uncertainties as to whether Nexvet
Shareholders will provide the requisite approvals for the Acquisition on
a timely basis or at all; the possibility that competing offers will be
made; the possibility that certain conditions to the consummation of the
Acquisition will not be satisfied, including without limitation
obtaining the requisite approval of the Scheme at the Scheme Meeting;
the possibility that shareholders will file lawsuits challenging the
Acquisition, including actions seeking to rescind the Scheme or enjoin
the consummation of the Acquisition; the ability to meet expectations
regarding the accounting and tax treatments of the Acquisition; changes
in relevant tax and other laws or regulations; the integration of Nexvet
being more difficult, time-consuming or costly than expected; the
diversion of Zoetis, Zoetis Bidco and/or Nexvet management time and
attention to issues relating to the Acquisition and integration;
operating costs, customer loss and business disruption (including,
without limitation, difficulties in maintaining relationships with
employees, customers, clients or suppliers) being greater than expected
following the Acquisition; the difficulty retaining certain key
employees of Nexvet, Zoetis and Zoetis Bidco following the Acquisition;
the scope, timing and outcome of any ongoing legal proceedings involving
Zoetis, Zoetis Bidco or Nexvet and the impact of any such proceedings on
financial condition, results of operations and/or cash flows of Zoetis,
Zoetis Bidco or Nexvet; the possibility that costs, fees, expenses or
charges Zoetis, Zoetis Bidco and/or Nexvet incur in connection with the
Acquisition are greater than expected; the possibility that the Scheme
may be terminated in circumstances that require Nexvet to reimburse
certain expenses of Zoetis and/or Zoetis Bidco; the ability of Zoetis,
Zoetis Bidco or Nexvet to protect intellectual property and preserve
intellectual property rights; and changes in the economic and financial
conditions of the businesses of Zoetis, Zoetis Bidco or Nexvet.
(d) Further, with regard to Nexvet, a number of important factors could
cause Nexvet’s actual future results and other future circumstances to
differ materially from those expressed in any forward-looking
statements. Such factors include, but are not limited to:
(i) the ability of Nexvet to access capital at affordable rates;
(ii) the inherent risks relating to the clinical development of Nexvet’s
pipeline, and the risks relating to the regulatory, manufacturing and
commercialisation steps required to reach sustained profitability; and
(iii) the significant costs and risks related to achieving the
successful commercialisation of the pipeline. Launching Nexvet’s
pipeline would require investment in large commercial infrastructure
with significant associated upfront costs and risks.
(e) In addition, actual results are subject to other risks and
uncertainties that relate more broadly to Zoetis’ and Nexvet’s overall
businesses. With respect to Zoetis and Zoetis Bidco, a further list and
description of risks, uncertainties and other matters can be found in
Zoetis’ Annual Report on Form 10-K for the fiscal year ended December
31, 2016, including in the sections thereof captioned “Forward-Looking
Statements and Factors That May Affect Future Results” and “Item 1A.
Risk Factors,” in Zoetis’ Quarterly Reports on Form 10-Q and in Zoetis’
Current Reports on Form 8-K. These filings and subsequent filings are
available online at www.sec.gov,
www.zoetis.com,
or on request from Zoetis. With respect to Nexvet, additional
information regarding factors that could cause actual results to differ
materially from our expectations expressed in this release include those
summarized under Risk Factors in its reports on Forms 10-Q and 10-K and
the other documents filed from time to time with the SEC.
(f) Any forward-looking statements in this Announcement are based upon
information available to Zoetis, Zoetis Bidco, Nexvet and/or their
respective boards of directors, as the case may be, as of the date of
this Announcement and, while believed to be true when made, may
ultimately prove to be incorrect. Subject to any obligations under
applicable Law, rules and regulations, none of Zoetis, Zoetis Bidco,
Nexvet or any member of their respective boards of directors undertakes
any obligation to update any forward-looking statement whether as a
result of new information, future developments or otherwise, or to
conform any forward-looking statement to actual results, future events,
or to changes in expectations. All subsequent written and oral
forward-looking statements attributable to Zoetis, Zoetis Bidco, Nexvet,
their respective boards of directors or any person acting on behalf of
any of them are expressly qualified in their entirety by this paragraph.
5.4 No Profit Forecast / Asset Valuations
No statement in this Announcement is intended to constitute a profit
forecast for any period, nor should any statements be interpreted to
mean that earnings or earnings per share will necessarily be greater or
lesser than those for the relevant preceding financial periods for
Nexvet, Zoetis or Zoetis Bidco as appropriate. No statement in this
Announcement constitutes an asset valuation.
5.5 Disclosure Requirements for Certain Holders of Nexvet Securities
(a) Under the provisions of Rule 8.3 of the Takeover Rules, if any
person is, or becomes, “interested” (directly or indirectly) in, 1% or
more of any class of “relevant securities” of Nexvet, all “dealings” in
any “relevant securities” of Nexvet (including by means of an option in
respect of, or a derivative referenced to, any such “relevant
securities”) must be publicly disclosed by not later than 3.30 p.m.
(Eastern Time) on the “business day” following the date of the relevant
transaction. This requirement will continue until the Offer Period ends.
If two or more persons co-operate on the basis of any agreement, either
express or tacit, either oral or written, to acquire an “interest” in
“relevant securities” of Nexvet, they will be deemed to be a single
person for the purpose of Rule 8.3 of the Takeover Rules.
(b) Under the provisions of Rule 8.1 of the Takeover Rules, all
“dealings” in “relevant securities” of Nexvet by Zoetis or Zoetis Bidco,
or by any party acting in concert with any of them, must also be
disclosed by no later than 12 p.m. (Eastern Time) on the “business” day
following the date of the relevant transaction.
(c) A disclosure table, giving details of the companies in whose
“relevant securities” “dealings” should be disclosed, can be found on
the Irish Takeover Panel’s website at www.irishtakeoverpanel.ie.
(d) “Interests in securities” arise, in summary, when a person has long
economic exposure, whether conditional or absolute, to changes in the
price of securities. In particular, a person will be treated as having
an “interest” by virtue of the ownership or control of securities, or by
virtue of any option in respect of, or derivative referenced to,
securities.
(e) Terms in quotation marks are defined in the Takeover Rules, which
can also be found on the Irish Takeover Panel’s website at www.irishtakeoverpanel.ie.
(f) If you are in any doubt as to whether or not you are required to
disclose a dealing under Rule 8, please consult the Irish Takeover
Panel’s website at www.irishtakeoverpanel.ie
or contact the Irish Takeover Panel on telephone number +353 1 678 9020
or fax number +353 1 678 9289.
5.6 Further Information
(a) This Announcement is not intended to, and does not, constitute an
offer to purchase, sell, subscribe for or exchange, or the solicitation
of an offer to purchase, sell, subscribe for or exchange or an
invitation to purchase, sell, subscribe for or exchange any securities
or the solicitation of any vote or approval in any jurisdiction pursuant
to the Acquisition or otherwise, nor shall there be any sale, issuance
or transfer of securities in any jurisdiction in contravention of
applicable Law. This Announcement does not constitute a prospectus or an
equivalent document and it is not intended to, and does not, constitute
or form any part of an offer or invitation to sell or purchase or
subscribe for any securities or a solicitation of an offer to buy any
securities or the solicitation of any vote or approval in any
jurisdiction pursuant to the Acquisition or otherwise.
(b) The release, publication or distribution of this Announcement in or
into certain jurisdictions may be restricted by the laws of those
jurisdictions, including any Restricted Jurisdictions. Accordingly,
copies of this Announcement and all other documents relating to the
Acquisition are not being, and must not be, released, published, mailed
or otherwise forwarded, distributed or sent in, into or from any
Restricted Jurisdictions. Persons receiving such documents (including,
without limitation, nominees, trustees and custodians) should observe
these restrictions. Failure to do so may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable Law, the companies involved in the Acquisition
disclaim any responsibility or liability for the violations of any such
restrictions by any person.
(c) The full text of the conditions to which the Acquisition is subject
and reference to certain further terms of the Acquisition are set out in
Schedule 1.
(d) Any response in relation to the Acquisition should be made only on
the basis of the information contained in the Proxy Statement, including
the Scheme Document, or any other document by which the Acquisition is
made. Nexvet Shareholders are advised to read carefully the formal
documentation in relation to the proposed Acquisition once the Scheme
Document, as part of the Proxy Statement, has been despatched to them.
(e) This Announcement, which is published jointly by Zoetis, Zoetis
Bidco and Nexvet, is made pursuant to Rule 2.5 of the Takeover Rules.
(f) Zoetis Bidco reserves the right to elect to implement the
Acquisition by way of a Takeover Offer as an alternative to the Scheme,
subject to the provisions of the Transaction Agreement and with the
Panel’s consent. In such event, the Acquisition will be implemented on
substantially the same terms, so far as applicable, as those which would
apply to the Scheme, subject to appropriate amendments (including an
acceptance condition set at 80 per cent of the shares to which such
offer relates or such lesser percentage, being more than 50 per cent, as
Zoetis Bidco may, with the consent of the Panel (if required), decide).
(g) Pursuant to Rule 2.6(c) of the Takeover Rules, this Announcement
will be available to Nexvet employees on Nexvet’s website, www.nexvet.com
and to Zoetis Bidco’s employees on Zoetis’ website, www.zoetis.com/news-and-media.
This Announcement will be made available on a Zoetis website for the
purposes of the Acquisition (www.zoetis.com/news-and-media)
(subject to certain restrictions relating to persons in Restricted
Jurisdictions).
(h) A copy of the Announcement will be made available by Zoetis on its
website free of charge, subject to certain restrictions relating to
persons in Restricted Jurisdictions, at www.zoetis.com/news-and-media
by no later than 12 noon (Eastern Time), on 14 April 2017. Nexvet will
also make the Announcement and the documents required to be published
pursuant to the Takeover Rules by Nexvet available on its website free
of charge, subject to certain restrictions relating to persons in
Restricted Jurisdictions, at www.nexvet.com
by no later than 12 noon (Eastern Time), on 14 April 2017.
(i) Neither the content of any website referred to in this Announcement
nor the content of any website accessible from hyperlinks is
incorporated into, or forms part of, this Announcement.
5.7 Rounding
Certain figures included in this Announcement have been subjected to
rounding adjustments. Accordingly, any figures shown for the same
category presented in different tables may vary slightly and figures
shown as totals in certain tables may not be an arithmetic aggregation
of the figures that precede them.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART)
IN, INTO OR FROM ANY RESTRICTED JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION
For immediate release
13 April 2017
RECOMMENDED OFFER
FOR
NEXVET
BY
ZOETIS
(through Zoetis Belgium S.A. (“Zoetis Bidco”), its wholly owned
subsidiary)
TO BE IMPLEMENTED BY MEANS OF A SCHEME OF ARRANGEMENT
UNDER CHAPTER 1 OF PART 9 OF THE COMPANIES ACT 2014
1. INTRODUCTION
1.1 Nexvet and Zoetis are pleased to announce that they have reached
agreement on the terms of the recommended acquisition by Zoetis, through
Zoetis Bidco, of Nexvet by means of a scheme of arrangement under
Chapter 1 of Part 9 of the Act.
1.2 The Acquisition will be on the terms and subject to the conditions
set out below, and the implementation of the Acquisition and the Scheme
will be subject to the conditions referred to in Schedule 1 of this
Announcement, which will also be set out in the Scheme Document.
2. ACQUISITION TERMS
2.1 It is intended that the Acquisition will be implemented by way of a
court sanctioned scheme of arrangement under Chapter 1 of Part 9 of the
Act. The Acquisition and the Scheme are subject to the conditions set
out in Schedule 1 of this Announcement and the further terms to be set
out in the Scheme Document.
2.2 Nexvet Shareholders will be entitled to receive from Zoetis Bidco
US$6.72 in cash for each Nexvet Share they hold, valuing the entire
issued and to be issued ordinary share capital of Nexvet at
approximately US$85 million.
2.3 The terms of the Acquisition represent a premium of approximately:
(a) 66% to the Closing Price of US$4.05 per Nexvet Share on 12 April
2017 (being the last practicable date prior to the publication of this
Announcement);
(b) 71% to the volume weighted average price of US$3.94 per Nexvet Share
for the one month period ended on 12 April 2017; and
(c) 87% to the volume weighted average price of US$3.59 per Nexvet Share
for the three month period ended on 12 April 2017.
3. NEXVET BACKGROUND TO AND REASONS FOR RECOMMENDING THE ACQUISITION
Nexvet is leveraging diverse global expertise and available incentives
to build a vertically integrated biopharmaceutical company, which
conducts drug discovery in Australia, conducts clinical development
in the United States and Europe and conducts manufacturing in Ireland.
Nexvet’s most clinically advanced product candidate is ranevetmab.
Nexvet’s pivotal efficacy and field safety study of ranevetmab met its
primary efficacy endpoint, demonstrating a statistically significant
improvement over placebo in the assessed level of pain.
Nexvet’s next most advanced product candidate is frunevetmab. Following
positive proof-of-concept studies, in May 2016 Nexvet also obtained
positive results from a pilot field safety and efficacy study, which
enrolled 126 cats with naturally occurring osteoarthritis. The
successful completion of these studies have informed preparations for a
pivotal field efficacy and safety study and a pivotal target animal
safety study, both of which commenced in late 2016.
In addition, Nexvet conducts drug discovery in the areas of
immuno-oncology, inflammation and allergy.
The Nexvet Directors believe that significant additional capital
investment will be required to develop and commercialise ranevetmab and
frunevetmab, as well as develop the remainder of the pipeline. In order
to finance its operations through to sustained profitability, Nexvet
would need to raise a large amount of capital relative to its current
market capitalisation, which would likely result in significant dilution
of existing shareholder positions.
In considering whether or not to recommend the proposed offer, the
Nexvet Board have taken into account the following factors:
-
The significant premium to the current share price represented by the
US$6.72 per share purchase price. The price offered represents a 66%
premium over Nexvet’s Closing Price on 12 April 2017, a 71% premium
over Nexvet’s one month volume weighted average price per share, and a
87% premium over Nexvet’s three month volume weighted average price
per share;
-
The elimination of the need for current Nexvet Shareholders to invest
any additional capital into Nexvet, and avoidance of potential
dilution that would likely occur from raising capital from third
parties;
-
The inherent risks relating to the clinical development of Nexvet’s
pipeline, and then the risks relating to the subsequent successful
potential regulatory, manufacturing and commercialisation steps
required to reach sustained profitability;
-
The significant costs and risks related to achieving the successful
commercialisation of the pipeline. Launching Nexvet’s pipeline would
require investment in a large commercial infrastructure with
significant associated upfront costs and risks; and
-
Nexvet has investigated other strategic options involving third
parties, including the receipt of proposals from third parties
relating to both licensing and acquisition transactions. The Nexvet
Board has concluded that the terms of these proposals were not as
attractive as the terms of the Acquisition.
4. ZOETIS BACKGROUND TO AND REASONS FOR THE ACQUISITION
4.1 The acquisition of Nexvet would strengthen Zoetis’ pipeline in
monoclonal antibodies (mAbs) - an important area where Zoetis is looking
to expand its portfolio and sustain its leadership.
4.2 Pain is an important companion animal therapeutic area of
approximately US$400 million globally a year. Zoetis has been a leader
in companion animal pain based on its RIMADYL pharmaceutical
non-steroidal anti-inflammatory (NSAID) product, and Nexvet’s pipeline
product ranevetmab (a mAb targeting nerve-growth factor (NGF)) would
complement Zoetis’ offering with the introduction of the industry’s
first monoclonal antibody for chronic pain (monthly injectable).
Ranevetmab would be a highly differentiated alternative to Zoetis’ NSAID
pain products, which are administered daily instead of monthly, have a
different form of administration and work through a different mechanism
of action. Feline treatments for pain are limited, and Nexvet’s
feline-specific injectable mAb (frunevetmab, also a mAb targeting NGF)
could also open up a new opportunity in feline pain that is underserved
today.
4.3 This transaction demonstrates Zoetis’ intent to remain the leader in
animal health and innovation, and its judicious capital allocation
strategy consisting of a mix of internal R&D and business development
activities to grow the business and create value for shareholders.
5. NEXVET RECOMMENDATION
5.1 The Nexvet Directors, who have been so advised by Evercore as to the
financial terms of the Acquisition, consider the terms of the
Acquisition to be fair and reasonable. In providing its advice to the
Nexvet Directors, Evercore has taken into account the commercial
assessments of the Nexvet Directors.
(a) Evercore is acting as independent financial adviser to the Nexvet
Directors in relation to the Acquisition for the purposes of Rule 3 of
the Takeover Rules. The Nexvet Board unanimously recommends to Nexvet
Shareholders to vote in favour of the Acquisition and the Scheme, as the
directors of Nexvet who are Nexvet Shareholders intend to do in respect
of their own beneficial holdings.
(b) The Nexvet Directors have irrevocably undertaken (in their capacity
as shareholders) to vote in favour of the Acquisition and the Scheme in
respect of their own beneficial holdings of 543,813 Nexvet Shares
representing, in aggregate, approximately 4.6% of the issued and
outstanding ordinary share capital of Nexvet on 12 April 2017 (being the
last practicable date prior to the publication of this Announcement).
6. BOARD, MANAGEMENT AND EMPLOYEES OF NEXVET
6.1 Zoetis confirms that, where employees of Nexvet have existing
employment rights, including pension rights, under applicable Laws,
those rights will be safeguarded following the Scheme becoming Effective.
6.2 All of the current directors of Nexvet will resign from Nexvet’s
board of directors on or after the Effective Date.
7. STRUCTURE OF THE ACQUISITION
7.1 The Acquisition is expected to be effected by means of the Scheme.
The Scheme will involve an application by Nexvet to the High Court to
sanction the Scheme. Under the Scheme (which will be subject to the
conditions set out in Schedule 1 of this Announcement and which will
also be set out in the Scheme Document), Nexvet Shareholders will
receive the Consideration in return for the cancellation or transfer of
their Nexvet Shares.
7.2 The Scheme is subject to the approval of the High Court. If the
Scheme becomes Effective, all of the issued and outstanding Nexvet
Shares will be cancelled pursuant to Sections 84 to 86 of the Act or
transferred to Zoetis Bidco pursuant to the Scheme (if applicable).
Nexvet will then issue new Nexvet Shares to Zoetis Bidco in place of
Nexvet Shares cancelled pursuant to the Scheme and Zoetis Bidco will pay
the Consideration in respect of the Nexvet Shares to the former Nexvet
Shareholders. As a result of these arrangements, Nexvet will become a
wholly owned subsidiary of Zoetis Bidco.
7.3 The Acquisition is conditional on the Scheme becoming Effective by
no later than 5pm (Eastern time) on the End Date (or such earlier date
as may be specified by the Panel or such later date to which Zoetis
Bidco and Nexvet may, with any required consent of the Panel, agree and
which, if High Court approval is required, the High Court may allow).
The conditions to the Acquisition and the Scheme are set out in full in
Schedule 1 of this Announcement. The implementation of the Scheme and
the Acquisition is conditional, amongst other things, upon:
(a) the approval of the Scheme by a majority in number of Nexvet
Shareholders representing at least 75% in value of Nexvet Shares at the
Voting Record Time held by such holders in each relevant class, present
and voting either in person or by proxy, at the Scheme Meeting (or at
any adjournment of such meeting);
(b) the EGM Resolutions being duly passed by the requisite majority of
Nexvet Shareholders at the EGM (or at any adjournment of such meeting);
(c) the sanction by the High Court (with or without modification (but
subject to such modification being acceptable to each of Nexvet and
Zoetis Bidco)) of the Scheme pursuant to Sections 449 to 455 of the Act
and the confirmation of the related capital reduction involved therein
by the High Court; and
(d) copies of the Court Order and the minute required by Section 86 of
the Act in respect of the said capital reduction being delivered for
registration to the Registrar of Companies and registration of the Court
Order and minute confirming the capital reduction involved in the Scheme
by the Registrar of Companies on or before the End Date.
7.4 Assuming the necessary approvals from Nexvet Shareholders have been
obtained and all other conditions have been satisfied or, where
applicable, waived, the Scheme will become Effective upon delivery to
the Registrar of Companies of a copy of the Court Order, together with
the minute required by Section 86(1) of the Act confirming the capital
reduction and registration of the Court Order and minute by the
Registrar of Companies. If the Scheme becomes Effective, it will be
binding on all Nexvet Shareholders, irrespective of whether or not they
attended or voted at the Scheme Meeting or the EGM (and, if they
attended and voted, whether or not they voted in favour).
7.5 Zoetis Bidco reserves the right, subject to the prior approval of
the Panel, to elect to implement the Acquisition by way of an Offer in
the circumstances described in and subject to the terms of the
Transaction Agreement. Without limiting the provisions of the
Transaction Agreement, in such event, such Offer will be implemented on
terms and conditions that are at least as favourable to Nexvet
Shareholders as those which would apply in relation to the Scheme
(except in relation to the acceptance condition which will be set at 80
per cent of the shares to which such offer relates or such lesser
percentage, being more than 50 per cent, as Zoetis Bidco may, with the
consent of the Panel (if required), decide).
7.6 The Scheme Document, containing further details of the Acquisition
(including notices of the Meetings) and the full terms and conditions of
the Scheme, will be mailed as soon as possible after the date of this
Announcement to Nexvet Shareholders, and, for information only, to
holders of Nexvet Convertible Securities. Resolutions to approve the
Acquisition will be voted upon at the Meetings.
7.7 The Scheme Document will also specify the actions to be taken by
Nexvet Shareholders. It is currently expected that the Acquisition and
the Scheme will become Effective during the second half of this calendar
year.
8. ABOUT NEXVET
Nexvet’s platform technology, which it refers to as “PETization”, is an
algorithmic approach that enables Nexvet to rapidly create monoclonal
antibodies (mAbs) a type of biologic, that are designed to be recognised
as “self” or “native” by an animal’s immune system, a property referred
to as “100% species-specificity”. PETization is designed to build upon
the safety and efficacy data from clinically tested human therapies to
create new therapies for companion animals, which is intended to reduce
clinical risk and development cost.
Nexvet is leveraging diverse global expertise and available incentives
to build a vertically integrated biopharmaceutical company, which
conducts drug discovery in Australia, conducts clinical development
in the United States and Europe and conducts manufacturing in Ireland.
mAbs are targeted antibodies produced by identical or clonal cells that
are engineered to produce a specific mAb and they are a prominent class
of therapeutic biologics in humans. Nexvet’s most advanced product
candidates are mAbs that target and inhibit the function of nerve growth
factor (“NGF”) for the control of pain associated with osteoarthritis in
dogs and cats. NGF is a protein that directs nerve growth and is
involved in nerve signaling, including pain signals, and NGF inhibitors
(“anti-NGFs”) seek to interrupt those signals to reduce pain. Nexvet’s
anti-NGF portfolio consists of ranevetmab (formerly “NV-01”) for dogs,
frunevetmab (formerly “NV-02”) for cats, both in clinical development as
monthly subcutaneous injectables.
Nexvet’s most clinically advanced product candidate is ranevetmab.
Nexvet’s pivotal efficacy and field safety study of ranevetmab met its
primary efficacy endpoint, demonstrating a statistically significant
improvement over placebo in the assessed level of pain. Clinically
meaningful magnitudes of benefit and statistically significant
differences over placebo were also achieved for the majority of the
secondary endpoints measured in the study, which used a monthly
subcutaneous injection for three months.
Nexvet’s next most advanced product candidate is frunevetmab. Following
positive proof-of-concept studies, in May 2016 Nexvet also obtained
positive results from a pilot field safety and efficacy study, which
enrolled 126 cats with naturally occurring osteoarthritis. The
successful completion of these studies has informed preparations for a
pivotal field efficacy and safety study and a pivotal target animal
safety study, both of which commenced in late 2016.
In September 2015, Nexvet secured a biopharmaceutical manufacturing
facility in Tullamore, Ireland. The facility has been reconfigured to be
a dedicated veterinary biopharmaceutical facility with the capability to
meet anticipated future clinical and commercial production needs for
therapeutic drug substance. The facility is operated by a wholly-owned
subsidiary of Nexvet, Bionua Limited.
9. ABOUT ZOETIS AND ZOETIS BIDCO
Zoetis is the leading animal health company, dedicated to supporting its
customers and their businesses. Building on more than 60 years of
experience in animal health, Zoetis discovers, develops, manufactures
and markets veterinary vaccines and medicines, complemented by
diagnostic products, genetic tests, biodevices and a range of services.
Zoetis serves veterinarians, livestock producers and people who raise
and care for farm and companion animals with sales of its products in
more than 100 countries. In 2016, Zoetis generated annual revenue of
US$4.9 billion with approximately 9,000 employees. For more information,
visit www.zoetis.com.
Zoetis Bidco is an indirect wholly owned subsidiary of Zoetis.
10. FINANCING OF THE ACQUISITION
10.1 The Consideration payable by Zoetis Bidco under the terms of the
Acquisition will be funded by cash on hand and Zoetis Bidco’s own
financial resources.
10.2 Further information on the Consideration will be set out in the
Scheme Document.
10.3 Goldman Sachs, financial adviser to Zoetis and Zoetis Bidco, is
satisfied that sufficient resources are available to Zoetis Bidco to
satisfy in full the Consideration payable to Nexvet Shareholders under
the terms of the Acquisition.
11. EFFECT OF ACQUISITION ON NEXVET CONVERTIBLE SECURITIES
The Acquisition will extend to any Nexvet Shares unconditionally
allotted or issued pursuant to the Nexvet Plans. Appropriate proposals
in respect of the effect of the Acquisition on the holders of Nexvet
Convertible Securities will be made to such holders at or around the
date of despatch of the Scheme Document and in accordance with the
provisions of Rule 15 of the Takeover Rules.
12. DELISTING AND CANCELLATION OF TRADING
As soon as it is appropriate and possible to do so, and subject to the
Scheme becoming Effective, Zoetis Bidco intends to cause Nexvet to apply
for cancellation of the listing and trading of Nexvet Shares on the
NASDAQ. Subject to any applicable requirements of the NASDAQ, it is
anticipated that the last day of dealing in Nexvet Shares on the NASDAQ
will be on or about the Effective Date. It is intended that Nexvet will
be re-registered as a private company limited by shares under the Act.
13. EXPENSES REIMBURSEMENT AGREEMENT
13.1 Nexvet has entered into an expenses reimbursement agreement, dated
13 April 2017, with Zoetis, the terms of which have been approved by the
Panel. Under the Expenses Reimbursement Agreement, Nexvet has agreed to
pay an amount equal to all documented, specific quantifiable third party
costs and expenses incurred by Zoetis and/or Zoetis Bidco, or on its
behalf, for the purpose of, in preparation for, or in connection with
the Acquisition, exploratory work carried out in contemplation of and in
connection with the Acquisition, legal, financial, accounting and
commercial due diligence, arranging financing and engaging advisers to
assist in the process (“Zoetis Reimbursement Payments”) provided that
the gross amount payable to Zoetis shall not, in any event, exceed such
sum as is equal to 1% of the total value of the issued and to be issued
share capital of Nexvet that is the subject of the Acquisition (the
“Cap”). The amount payable by Nexvet to Zoetis under such provisions of
the Expenses Reimbursement Agreement will exclude any amount in respect
of VAT incurred by Zoetis attributable to such third party costs to the
extent that it is recoverable by Zoetis.
13.2 The circumstances in which such payment will be made are:
(a) the Transaction Agreement is terminated:
(i) by Zoetis for the reason that the Nexvet Board or any committee
thereof:
(A) withdraws (or modifies in any manner adverse to Zoetis), or failed
to make when required pursuant to the Transaction Agreement, or proposes
publicly to withdraw (or modify in any manner adverse to Zoetis), the
Scheme Recommendation or, if applicable, the recommendation to the
holders of Nexvet Shares from the Nexvet Board to accept the Takeover
Offer; or
(B) approves, recommends or declares advisable or proposes publicly to
approve, recommend or declare advisable, any Nexvet Alternative Proposal
(it being understood, for the avoidance of doubt, that the provision by
Nexvet to Zoetis of notice or information in connection with a Nexvet
Alternative Proposal or Nexvet Superior Proposal as required or
expressly permitted by the Transaction Agreement shall not, in and of
itself, satisfy this paragraph (a)(i)(B)); or
(C) discloses a position that is deemed to be a “Nexvet Change of
Recommendation” under Clause 5.2(f) of the Transaction Agreement; or
(ii) by Nexvet, at any time prior to the approval of the Resolutions by
Nexvet Shareholders, in order to enter into any agreement, understanding
or arrangement providing for a Nexvet Superior Proposal; or
(b) all of the following occurring:
(i) prior to the Scheme Meeting, a Nexvet Alternative Proposal is
publicly disclosed or any person shall have publicly announced an
intention (whether or not conditional) to make a Nexvet Alternative
Proposal and, in each case, such disclosure or announcement is not
publicly and irrevocably withdrawn without qualification at least three
Business Days before the date of the Scheme Meeting (it being understood
that for this purpose references to “20%” in the definition of Nexvet
Alternative Proposal shall be deemed to refer to “50%”); and
(ii) the Transaction Agreement is terminated by Zoetis for the reason
that Nexvet shall have breached or failed to perform in any material
respect any of its representations, warranties, covenants or other
agreements contained in the Transaction Agreement, which material breach
or failure to perform:
(A) would result in a failure of any of the Conditions; and
(B) if curable, is not cured within 30 days following Zoetis’ delivery
of written notice to Nexvet of such breach or failure to perform (which
notice shall state Zoetis’ intention to terminate the Transaction
Agreement pursuant to Clause 9.1(a)(vi) of the Transaction Agreement and
the basis for such termination); and
(iii) a Nexvet Alternative Proposal is consummated, or a definitive
agreement providing for a Nexvet Alternative Proposal is entered into
within twelve months after such termination and such Nexvet Alternative
Proposal is consummated (in each case, regardless of whether such Nexvet
Alternative Proposal is the same Nexvet Alternative Proposal referred to
in paragraph 13.2(b)(i) above); or
(c) all of the following occur:
(i) prior to the Scheme Meeting, a Nexvet Alternative Proposal is
publicly disclosed or any person shall have publicly announced an
intention (whether or not conditional) to make a Nexvet Alternative
Proposal and, in each case, such disclosure or announcement is not
publicly and irrevocably withdrawn without qualification at least three
Business Days before the date of the Scheme Meeting (it being understood
that for this purpose references to “20%” in the definition of Nexvet
Alternative Proposal shall be deemed to refer to “50%”); and
(ii) the Transaction Agreement is terminated by either Nexvet or Zoetis
for the reason that the Scheme Meeting or the EGM shall have been
completed and the Scheme Meeting Resolution or the EGM Resolutions, as
applicable, shall not have been approved by the requisite majority of
votes; and
(iii) a Nexvet Alternative Proposal is consummated, or a definitive
agreement providing for a Nexvet Alternative Proposal is entered into
within twelve months after such termination and such Nexvet Alternative
Proposal is consummated (in each case, regardless of whether such Nexvet
Alternative Proposal is the same Nexvet Alternative Proposal referred to
in paragraph 13.2(c)(i) above).
13.3 If and to the extent that any relevant Tax Authority correctly
determines that the Zoetis Reimbursement Payment is consideration for a
Taxable supply and that Nexvet is liable to account to a Tax Authority
for VAT in respect of such supply and that all or any part of such VAT
is Irrecoverable VAT, then (a) the amount payable by Nexvet by way of
the Zoetis Reimbursement Payment, together with any Irrecoverable VAT
arising in respect of the supply for which the payment is consideration,
shall not exceed the Cap; and (b) to the extent that Nexvet has already
paid an amount in respect of the Zoetis Reimbursement Payment which
exceeds the amount of the Expenses Reimbursement Agreement, Zoetis shall
repay to Nexvet the portion of the Irrecoverable VAT in excess of the
Cap. If Zoetis makes any such repayments to Nexvet, and after making
such a repayment, Nexvet becomes entitled to recover all, or any part,
of the related VAT from the relevant Tax Authority, Nexvet shall notify
Zoetis without delay and, as soon as practicable, repay to Zoetis the
lesser of: (a) the amount recoverable from the Tax Authority; and (b)
the sum paid by Zoetis to Nexvet.
13.4 Evercore and the Nexvet Board have each confirmed in writing to the
Panel that, in the opinion of Evercore and the Nexvet Board
(respectively), in the context of the Note to Rule 21.2 of the Takeover
Rules and the Acquisition, the Expenses Reimbursement Agreement is in
the best interests of Nexvet Shareholders. The Panel has consented to
Nexvet entering into the Expenses Reimbursement Agreement. A copy of the
Expenses Reimbursement Agreement will be furnished by Nexvet with the
SEC on Form 8-K and filed by Zoetis with the SEC on Form 8-K on or
around the date of this Announcement.
14. TRANSACTION AGREEMENT
14.1 Nexvet, Zoetis and Zoetis Bidco have entered into a Transaction
Agreement dated 13 April 2017 which contains, amongst other things,
certain obligations and commitments in relation to the implementation of
the Acquisition and provisions in relations to the conduct of Nexvet’s
business up to the Effective Date.
14.2 Further information regarding the Transaction Agreement and a
summary of its principal terms will be set out in the Proxy Statement,
including the Scheme Document. A copy of the Transaction Agreement is
set out in Schedule 4 to this Announcement, and a copy of the
Transaction Agreement will be filed by Nexvet with the SEC on Form 8-K
and filed by Zoetis with the SEC on Form 8-K on or around the date of
this Announcement.
14.3 The Proxy Statement, which will be filed with the SEC, will contain
important information about the Acquisition (including the Scheme), the
Transaction Agreement, the Scheme Meeting and the EGM
15. IRREVOCABLE UNDERTAKINGS
15.1 Zoetis and Zoetis Bidco has received irrevocable undertakings from
Christopher Brown, George Gunn, Ashraf Hanna, Mark Heffernan, Cormac
Kilty, Joseph McCracken, Rajiv Patel and John Payne, being members of
the Nexvet Board, that they will vote in favour of the Proposals and
Resolutions at the Meetings in their capacity as shareholders (or, in
the event that the Acquisition is implemented by way of an Offer on
terms and conditions at least as favourable, in aggregate, as the
Scheme, to accept the Offer or procure acceptance of the Offer) in
respect of their entire beneficial holdings of Nexvet Shares amounting
to, in aggregate, 543,813 Nexvet Shares, representing approximately 4.6%
of the issued and outstanding ordinary share capital of Nexvet on 12
April 2017 (being the last practicable date prior to the publication of
this Announcement).
15.2 In addition, Zoetis and Zoetis Bidco has received irrevocable
undertakings from certain other Nexvet Shareholders, namely Farallon
Capital Management LLC (acting through related companies), Adage Capital
Partners GP LLC and Broadfin Capital LLC, that they will vote in favour
of the Proposals and Resolutions at the Meetings (or, in the event that
the Acquisition is implemented by way of an Offer on terms and
conditions at least as favourable, in aggregate, as the Scheme, to
accept the Offer or procure acceptance of the Offer) in respect of their
entire beneficial holdings of Nexvet Shares amounting to, in aggregate,
4,570,896 Nexvet Shares, representing approximately 38.4% of the issued
and outstanding ordinary share capital of Nexvet on 12 April 2017 (being
the last practicable date prior to the publication of this Announcement).
15.3 The irrevocable undertakings from members of the Nexvet Board
referred to above shall lapse upon the occurrence of certain events,
namely the earlier to occur of the following:
(a) the Scheme becoming effective;
(b) if this Announcement is not released by 21 April 2017 or such later
date as Zoetis, Zoetis Bidco and Nexvet may agree; or
(c) the Transaction Agreement is terminated in accordance with its terms.
The irrevocable undertaking from each of the Nexvet Shareholders
referred to above shall lapse upon the occurrence of certain events,
namely the earliest to occur of the following:
(a) the Scheme becoming effective;
(b) if this Announcement is not released by 21 April 2017 or such later
date as Zoetis, Zoetis Bidco and Nexvet may agree;
(c) if any third party shall, in accordance with the Takeover Rules
announce a firm intention to make a general offer to acquire the entire
issued and to be issued share capital of Nexvet (not already owned by
such third party) with a value per ordinary share of Nexvet in cash (or
equivalent to cash) of US$7.06 or more; or
(d) the Transaction Agreement is terminated in accordance with its terms.
15.4 Copies of the forms of the irrevocable undertakings referred to
above will be filed by Nexvet with the SEC on Form 8-K and filed by
Zoetis with the SEC on Form 8-K on or around the date of this
Announcement.
16. DISCLOSURE OF INTERESTS IN RELEVANT SECURITIES OF NEXVET
16.1 At the date of this Announcement, so far as Zoetis or Zoetis Bidco
is aware, Zoetis or Zoetis Bidco does not hold any Nexvet Shares.
16.2 As at 12 April 2017, which is the last practicable date prior to
the date of this Announcement, none of Zoetis nor Zoetis Bidco nor (so
far as Zoetis and Zoetis Bidco is aware) any other person Acting in
Concert with Zoetis or Zoetis Bidco had any Nexvet Shares or had any
interest, or held any short position, in any Relevant Securities of
Nexvet and none of Zoetis nor Zoetis Bidco nor (so far as Zoetis or
Zoetis Bidco is aware) any person Acting in Concert with Zoetis or
Zoetis Bidco has any arrangement to which Rule 8.7 applies relating to
Relevant Securities of Nexvet.
16.3 For these purposes, “associate” and “arrangement to which Rule 8.7
applies” have the meanings given to those terms in the Takeover Rules.
An “arrangement to which Rule 8.7 applies” includes any indemnity or
option arrangement, and any agreement or understanding, formal or
informal, of whatever nature, between two or more persons relating to
Relevant Securities which is, or may be, an inducement to one or more of
such persons to deal or refrain from dealing in such securities.
16.4 In the interests of confidentiality, Zoetis, Zoetis Bidco and
Goldman Sachs have made only limited enquiries in respect of certain
parties who may be deemed by the Panel to be Acting in Concert with them
for the purposes of the Acquisition. Enquiries of such parties will be
made as soon as practicable following the date of this Announcement and
any disclosure in respect of such parties will be disclosed to the Panel
and included in the Scheme Document.
17. RULE 2.10 DISCLOSURE
In accordance with Rule 2.10 of the Takeover Rules, Nexvet confirms
that, as of 12 April 2017 (being the last practicable date prior to the
date of this Announcement), its issued ordinary share capital comprised
of 11,910,615 ordinary shares of $0.125 each (the “Ordinary Shares”).
The Ordinary Shares are admitted to trading on NASDAQ under the ticker
symbol NVET. The International Securities Identification Number for
these securities is IE00BVB38Y49.
Nexvet confirms that as of 12 April 2017, there were 1,766,998 warrants,
638,014 options and 654,041 restricted share units in respect of in
aggregate 3,059,053 Nexvet ordinary shares and 400 Nexvet euro deferred
shares outstanding.
18. RULE 30.2 DEROGATION
Rule 30.2 of the Takeover Rules requires that, except with the consent
of the Panel, and subject to Rule 2.7 of the Takeover Rules, Nexvet must
dispatch the Scheme Document to Nexvet Shareholders within 28 days of
the announcement of a firm intention to make an offer, being this
Announcement.
On 12 April 2017 the Panel agreed to grant the Parties a derogation from
Rule 30.2.
There is a requirement to file the Proxy Statement (which will also
contain the Scheme Document) with the SEC in connection with the Scheme.
The preparation of the Proxy Statement may take more than 28 days. Also,
the SEC may elect to review the Proxy Statement prior to declaring it
effective. This review process may take 60 days or more to complete.
Under SEC rules, the Proxy Statement cannot be dispatched to Nexvet
Shareholders until the Proxy Statement is declared effective by the SEC.
The Panel granted the derogation on the basis that the Scheme Document
cannot be dispatched until the Proxy Statement is declared effective by
the SEC. The Scheme Document will be dispatched to Nexvet Shareholders
as soon as practicable after the Proxy Statement is declared effective.
19. GENERAL
19.1 The Acquisition and the Scheme will be subject to the conditions
set out in Schedule 1, which will also be set out in the Scheme
Document, which will be contained in the Proxy Statement. The Scheme
Document will include full details of the Acquisition and will be
accompanied by the appropriate forms of proxy. These will be despatched
as part of the Proxy Statement to Nexvet Shareholders and, for
information only, to holders of Nexvet Convertible Securities, as soon
as practicable, together with notices of the Scheme Meeting and the EGM
and the expected timetable, and will specify the necessary action to be
taken by Nexvet Shareholders. The Acquisition and the Scheme will be
governed by the laws of Ireland and will be subject to the applicable
requirements of the Takeover Rules, the NASDAQ and all other applicable
Laws.
19.2 Schedule 2 contains a summary of the sources of information and
bases of calculation for certain items contained in this Announcement.
19.3 Certain definitions and expressions used in this Announcement are
set out in Schedule 3.
19.4 Schedule 4 contains a copy of the Transaction Agreement.
19.5 Zoetis and Zoetis Bidco’s financial adviser is Goldman Sachs.
Morgan, Lewis & Bockius LLP, New York and Arthur Cox, Dublin are
providing legal advice.
19.6 Nexvet’s co-lead advisers are Evercore, which is acting as
financial adviser to Nexvet, including for the purposes of Rule 3 of the
Takeover Rules, and Cowen, which is acting as financial adviser to
Nexvet. DLA Piper, Seattle and Matheson, Dublin are providing legal
advice.
This Announcement is being made pursuant to Rule 2.5 of the Takeover
Rules.
Publication on Website
19.7 A copy of the Announcement will be made available by Zoetis on its
website free of charge, subject to certain restrictions relating to
persons in Restricted Jurisdictions, at www.zoetis.com/news-and-media
by no later than 12 noon (Eastern Time), on 14 April 2017. Nexvet will
also make the Announcement and the documents required to be published
pursuant to the Takeover Rules by Nexvet available on its website free
of charge, subject to certain restrictions relating to persons in
Restricted Jurisdictions, at www.nexvet.com
by no later than 12 noon (Eastern Time), on 14 April 2017.
19.8 Contact Information
19.9 Responsibility for this Announcement
(a) The directors of Zoetis and the directors of Zoetis Bidco accept
responsibility for the information contained in this Announcement other
than the information relating to Nexvet and the directors of Nexvet and
members of their immediate families, related trusts and persons
connected with them. To the best of the knowledge and belief of the
directors of Zoetis and the directors of Zoetis Bidco (who have taken
all reasonable care to ensure that such is the case), the information
contained in this Announcement for which they accept responsibility is
in accordance with the facts and does not omit anything likely to affect
the import of such information.
(b) The directors of Nexvet accept responsibility for the information
contained in this Announcement relating to Nexvet and the directors of
Nexvet and members of their immediate families, related trusts and
persons connected with them. To the best of the knowledge and belief of
the directors of Nexvet (who have taken all reasonable care to ensure
that such is the case), the information contained in this Announcement
for which they accept responsibility is in accordance with the facts and
does not omit anything likely to affect the import of such information.
(c) Goldman Sachs, which is authorised by the Prudential Regulation
Authority and regulated by the Financial Conduct Authority and the
Prudential Regulation Authority in the United Kingdom, is acting as
financial adviser exclusively for Zoetis and Zoetis Bidco and no one
else in connection with the Acquisition and the other matters referred
to in this Announcement, and will not regard any other person as its
client in relation to the Acquisition and the other matters referred to
in this Announcement and will not be responsible to anyone other than
Zoetis and Zoetis Bidco for providing the protections afforded to
clients of Goldman Sachs, nor for providing advice in relation to the
Acquisition or the other matters referred to in this Announcement.
(d) Evercore, which is authorised and regulated in the United Kingdom by
the Financial Conduct Authority, is acting as financial adviser for
Nexvet, including for the purposes of Rule 3 of the Takeover Rules, and
no one else in connection with the Acquisition and the other matters
referred to in this Announcement and will not regard any other person as
its client in relation to the Acquisition and the other matters referred
to in this Announcement and will not be responsible to anyone other than
Nexvet for providing the protections afforded to clients of Evercore,
nor for providing advice in relation to the Acquisition or the other any
matter referred to in this Announcement. Neither Evercore nor any of its
subsidiaries, branches or affiliates owes or accepts any duty, liability
or responsibility whatsoever (whether direct or indirect, whether in
contract, in tort, under statute or otherwise) to any person who is not
a client of Evercore in connection with this Announcement, any statement
contained therein or otherwise.
(e) Cowen, which is a securities broker-dealer registered with the SEC
and subject to regulation by the SEC and FINRA, is acting as financial
adviser for Nexvet and for no one else in connection with the
Acquisition and the other matters referred to in this Announcement, and
will not be responsible to anyone other than Nexvet for providing the
protections afforded to clients of Cowen or for providing advice in
relation to the Acquisition and the other matters referred to in this
Announcement.
19.10 Important Information for U.S. Investors
(a)
Important Legal Information
.
In connection with the proposed transactions, Nexvet will prepare the
Proxy Statement (including the Scheme Document) to be filed with the
SEC. When completed, a definitive Proxy Statement and a form of proxy
will be mailed to the shareholders of Nexvet. BEFORE MAKING ANY
VOTING DECISION, NEXVET SHAREHOLDERS ARE URGED TO READ THE PROXY
STATEMENT (INCLUDING THE SCHEME DOCUMENT) CAREFULLY AND IN ITS ENTIRETY
BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Nexvet Shareholders
will be able to obtain, without charge, a copy of the Proxy Statement
(when available) and other relevant documents filed with the SEC from
the SEC’s website at http://www.sec.gov.
Nexvet Shareholders will also be able to obtain, without charge, a copy
of the Proxy Statement (including the Scheme Document) and other
relevant documents (when available) by directing a request by mail or
telephone to Geraldine Farrell, Unit 5, Sragh Technology Park, Rahan
Road, Tullamore, County Offaly, Ireland, telephone: +353 5793 24522, or
from Nexvet’s website, www.nexvet.com.
(b)
Participant Information
.
Information about Nexvet’s directors and executive officers who may be
deemed to participate in the solicitation of proxies in respect of the
proposed transaction is set forth in Nexvet’s Annual Report on Form 10-K
for the fiscal year ended June 30, 2016 and Nexvet’s proxy statement for
Nexvet’s 2016 annual meeting of shareholders. Nexvet Shareholders may
obtain additional information regarding the interests of Nexvet and its
directors and executive officers in the transactions, which may be
different than those of Nexvet Shareholders generally, by reading the
proxy statement and other relevant documents regarding the proposed
transactions, when filed with the SEC.
(c) Nexvet is incorporated under the laws of Ireland. Some or all of the
directors of Nexvet are resident in countries other than the United
States. As a result, it may not be possible for U.S. holders of Nexvet
Shares to effect service of process within the United States upon Nexvet
or such directors of Nexvet or to enforce against any of them U.S.
judgements predicated upon the civil liability provisions of the U.S.
securities laws. It may not be possible to sue Nexvet or its officers or
directors in a non-U.S. court for violations of U.S. securities laws.
19.11 Forward-looking statements
(a) Zoetis and Zoetis Bidco: This Announcement contains forward-looking
statements, which reflect the current views of Zoetis and Zoetis Bidco
with respect to business plans or prospects, future operating or
financial performance, future guidance, future operating models,
expectations regarding products, future use of cash and dividend
payments, tax rate and tax regimes, changes in the tax regimes and laws
in other jurisdictions, and other future events. Forward-looking
statements are subject to risks and uncertainties. If one or more of
these risks or uncertainties materialize, or if management's underlying
assumptions prove to be incorrect, actual results may differ materially
from those contemplated by a forward-looking statement. Forward-looking
statements speak only as of the date on which they are made. Each of
Zoetis and Zoetis Bidco expressly disclaim any obligation to update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
(b) Nexvet: This Announcement contains forward-looking statements
including those regarding Nexvet’s future results of operations and
financial position, ability to access financing on acceptable terms or
at all, results of any current or future pivotal study, future
expenditures relating to lead product candidates, time for completion of
any of studies or facilities upgrades, ability to develop its pipeline
of product candidates, business strategy, prospective products, ability
to successfully manufacture its own product candidates, ability to meet
conditions for the receipt of government grants, time for regulatory
submissions, ability to qualify for conditional licensure or obtain
product approvals, research and development costs, timing and likelihood
of success, plans and objectives of management for future operations,
and future results of current and anticipated products. They also
reflect uncertainties as to whether Nexvet Shareholders will approve the
Acquisition, the possibility that competing offers may be made, or other
factors that could cause the Acquisition not to occur. These statements
are not guarantees of future performance or actions. Forward-looking
statements are subject to risks and uncertainties. If one or more of
these risks or uncertainties materialize, or if management's underlying
assumptions prove to be incorrect, actual results may differ materially
from those contemplated by a forward-looking statement. Forward-looking
statements speak only as of the date on which they are made. Nexvet
expressly disclaims any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
(c) Factors that could cause or contribute to such differences include,
but are not limited to: uncertainties as to the timing of the
Acquisition; uncertainties as to whether Zoetis or Zoetis Bidco will be
able to consummate the Acquisition; uncertainties as to whether Nexvet
Shareholders will provide the requisite approvals for the Acquisition on
a timely basis or at all; the possibility that competing offers will be
made; the possibility that certain conditions to the consummation of the
Acquisition will not be satisfied, including without limitation
obtaining the requisite approval of the Scheme at the Scheme Meeting;
the possibility that shareholders will file lawsuits challenging the
Acquisition, including actions seeking to rescind the Scheme or enjoin
the consummation of the Acquisition; the ability to meet expectations
regarding the accounting and tax treatments of the Acquisition; changes
in relevant tax and other laws or regulations; the integration of Nexvet
being more difficult, time-consuming or costly than expected; the
diversion of Zoetis, Zoetis Bidco and/or Nexvet management time and
attention to issues relating to the Acquisition and integration;
operating costs, customer loss and business disruption (including,
without limitation, difficulties in maintaining relationships with
employees, customers, clients or suppliers) being greater than expected
following the Acquisition; the difficulty retaining certain key
employees of Nexvet, Zoetis and Zoetis Bidco following the Acquisition;
the scope, timing and outcome of any ongoing legal proceedings involving
Zoetis, Zoetis Bidco or Nexvet and the impact of any such proceedings on
financial condition, results of operations and/or cash flows of Zoetis,
Zoetis Bidco or Nexvet; the possibility that costs, fees, expenses or
charges Zoetis, Zoetis Bidco and/or Nexvet incur in connection with the
Acquisition are greater than expected; the possibility that the Scheme
may be terminated in circumstances that require Nexvet to reimburse
certain expenses of Zoetis and/or Zoetis Bidco; the ability of Zoetis,
Zoetis Bidco or Nexvet to protect intellectual property and preserve
intellectual property rights; and changes in the economic and financial
conditions of the businesses of Zoetis, Zoetis Bidco or Nexvet.
(d) Further, with regard to Nexvet, a number of important factors could
cause Nexvet’s actual future results and other future circumstances to
differ materially from those expressed in any forward-looking
statements. Such factors include, but are not limited to:
(i) the ability of Nexvet to access capital at affordable rates;
(ii) the inherent risks relating to the clinical development of Nexvet’s
pipeline, and the risks relating to the regulatory, manufacturing and
commercialisation steps required to reach sustained profitability; and
(iii) the significant costs and risks related to achieving the
successful commercialisation of the pipeline. Launching Nexvet’s
pipeline would require investment in large commercial infrastructure
with significant associated upfront costs and risks.
(e) In addition, actual results are subject to other risks and
uncertainties that relate more broadly to Zoetis’ and Nexvet’s overall
businesses. With respect to Zoetis and Zoetis Bidco, a further list and
description of risks, uncertainties and other matters can be found in
Zoetis’ Annual Report on Form 10-K for the fiscal year ended December
31, 2016, including in the sections thereof captioned “Forward-Looking
Statements and Factors That May Affect Future Results” and “Item 1A.
Risk Factors,” in Zoetis’ Quarterly Reports on Form 10-Q and in Zoetis’
Current Reports on Form 8-K. These filings and subsequent filings are
available online at www.sec.gov,
www.zoetis.com,
or on request from Zoetis. With respect to Nexvet, additional
information regarding factors that could cause actual results to differ
materially from our expectations expressed in this release include those
summarized under Risk Factors in its reports on Forms 10-Q and 10-K and
the other documents filed from time to time with the SEC.
(f) Any forward-looking statements in this Announcement are based upon
information available to Zoetis, Zoetis Bidco, Nexvet and/or their
respective boards of directors, as the case may be, as of the date of
this Announcement and, while believed to be true when made, may
ultimately prove to be incorrect. Subject to any obligations under
applicable Law, rules and regulations, none of Zoetis, Zoetis Bidco,
Nexvet or any member of their respective boards of directors undertakes
any obligation to update any forward-looking statement whether as a
result of new information, future developments or otherwise, or to
conform any forward-looking statement to actual results, future events,
or to changes in expectations. All subsequent written and oral
forward-looking statements attributable to Zoetis, Zoetis Bidco, Nexvet,
their respective boards of directors or any person acting on behalf of
any of them are expressly qualified in their entirety by this paragraph.
19.12 No Profit Forecast / Asset Valuations
No statement in this Announcement is intended to constitute a profit
forecast for any period, nor should any statements be interpreted to
mean that earnings or earnings per share will necessarily be greater or
lesser than those for the relevant preceding financial periods for
Nexvet, Zoetis or Zoetis Bidco as appropriate. No statement in this
Announcement constitutes an asset valuation.
19.13 Disclosure Requirements for Certain Holders of Nexvet Securities
(a) Under the provisions of Rule 8.3 of the Takeover Rules, if any
person is, or becomes, “interested” (directly or indirectly) in, 1% or
more of any class of “relevant securities” of Nexvet, all “dealings” in
any “relevant securities” of Nexvet (including by means of an option in
respect of, or a derivative referenced to, any such “relevant
securities”) must be publicly disclosed by not later than 3.30 p.m.
(Eastern Time) on the “business day” following the date of the relevant
transaction. This requirement will continue until the Offer Period ends.
If two or more persons co-operate on the basis of any agreement, either
express or tacit, either oral or written, to acquire an “interest” in
“relevant securities” of Nexvet, they will be deemed to be a single
person for the purpose of Rule 8.3 of the Takeover Rules.
(b) Under the provisions of Rule 8.1 of the Takeover Rules, all
“dealings” in “relevant securities” of Nexvet by Zoetis or Zoetis Bidco,
or by any party acting in concert with any of them, must also be
disclosed by no later than 12 p.m. (Eastern Time) on the “business” day
following the date of the relevant transaction.
(c) A disclosure table, giving details of the companies in whose
“relevant securities” “dealings” should be disclosed, can be found on
the Irish Takeover Panel’s website at www.irishtakeoverpanel.ie.
(d) “Interests in securities” arise, in summary, when a person has long
economic exposure, whether conditional or absolute, to changes in the
price of securities. In particular, a person will be treated as having
an “interest” by virtue of the ownership or control of securities, or by
virtue of any option in respect of, or derivative referenced to,
securities.
(e) Terms in quotation marks are defined in the Takeover Rules, which
can also be found on the Irish Takeover Panel’s website www.irishtakeoverpanel.ie.
(f) If you are in any doubt as to whether or not you are required to
disclose a dealing under Rule 8, please consult the Irish Takeover
Panel’s website at www.irishtakeoverpanel.ie
or contact the Irish Takeover Panel on telephone number +353 1 678 9020
or fax number +353 1 678 9289.
19.14 Further Information
(a) This Announcement is not intended to, and does not, constitute an
offer to purchase, sell, subscribe for or exchange, or the solicitation
of an offer to purchase, sell, subscribe for or exchange or an
invitation to purchase, sell, subscribe for or exchange any securities
or the solicitation of any vote or approval in any jurisdiction pursuant
to the Acquisition or otherwise, nor shall there be any sale, issuance
or transfer of securities in any jurisdiction in contravention of
applicable Law. This Announcement does not constitute a prospectus or an
equivalent document and it is not intended to and does not constitute or
form any part of an offer or invitation to sell or purchase or subscribe
for any securities or a solicitation of an offer to buy any securities
or the solicitation of any vote or approval in any jurisdiction pursuant
to the Acquisition or otherwise.
(b) The release, publication or distribution of this Announcement in or
into certain jurisdictions may be restricted by the laws of those
jurisdictions, including any Restricted Jurisdictions. Accordingly,
copies of this Announcement and all other documents relating to the
Acquisition are not being, and must not be, released, published, mailed
or otherwise forwarded, distributed or sent in, into or from any
Restricted Jurisdiction. Persons receiving such documents (including,
without limitation, nominees, trustees and custodians) should observe
these restrictions. Failure to do so may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable Law, the companies involved in the Acquisition
disclaim any responsibility or liability for the violations of any such
restrictions by any person.
(c) The full text of the conditions to which the Acquisition
is subject and reference to certain further terms of the Acquisition are
set out in Schedule 1.
(d) Any response in relation to the Acquisition should be made only on
the basis of the information contained in the Proxy Statement, including
the Scheme Document or any other document by which the Acquisition is
made. Nexvet Shareholders are advised to read carefully the formal
documentation in relation to the proposed Acquisition once the Scheme
Document, as part of the Proxy Statement, has been despatched to them.
(e) This Announcement, which is published jointly by Zoetis, Zoetis
Bidco and Nexvet, is made pursuant to Rule 2.5 of the Takeover Rules.
(f) Zoetis reserves the right to elect to implement the Acquisition by
way of a Takeover Offer as an alternative to the Scheme, subject to the
provisions of the Transaction Agreement and with the Panel’s consent. In
such event, the Acquisition will be implemented on substantially the
same terms, so far as applicable, as those which would apply to the
Scheme, subject to appropriate amendments (including an acceptance
condition set at 80 per cent of the shares to which such offer relates
or such lesser percentage, being more than 50 per cent, as Zoetis may,
with the consent of the Panel (if required), decide).
(g) Pursuant to Rule 2.6(c) of the Takeover Rules, this Announcement
will be available to Nexvet employees on Nexvet’s website, www.nexvet.com,
and to Zoetis Bidco’s employees on Zoetis’ website, www.zoetis.com/news-and-media.
This announcement will be made available on a Zoetis website for the
purposes of the Acquisition (www.zoetis.com/news-and-media)
(subject to certain restrictions relating to persons in Restricted
Jurisdictions).
(h) A copy of the Announcement will be made available by Zoetis on its
website free of charge, subject to certain restrictions relating to
persons in Restricted Jurisdictions, at www.zoetis.com/news-and-media
by no later than 12 noon (Eastern Time), on 14 April 2017. Nexvet will
also make the Announcement and the documents required to be published
pursuant to the Takeover Rules by Nexvet available on its website free
of charge, subject to certain restrictions relating to persons in
Restricted Jurisdictions, at www.nexvet.com
by no later than 12 noon (Eastern Time), on 14 April 2017.
(i) Neither the content of any website referred to in this Announcement
nor the content of any website accessible from hyperlinks it is
incorporated into, or forms part of, this Announcement.
19.15 Rounding
Certain figures included in this Announcement have been subjected to
rounding adjustments. Accordingly, any figures shown for the same
category presented in different tables may vary slightly and figures
shown as totals in certain tables may not be an arithmetic aggregation
of the figures that precede them.
SCHEDULE 1
CONDITIONS OF THE ACQUISITION AND THE SCHEME
The Acquisition and the Scheme will comply with the Takeover Rules and,
where relevant, the respective rules and regulations of the NASDAQ, the
Exchange Act and the Act and will be subject to the terms and conditions
set out in this Announcement and to be set out in the Scheme Document.
The Acquisition and the Scheme will be governed by the laws of Ireland
and subject to the exclusive jurisdiction of the courts of Ireland.
The Acquisition and Scheme will be subject to the conditions set out in
this Schedule 1 (the “Conditions”).
1. The Acquisition will be conditional upon the Scheme becoming
effective and unconditional by not later than the End Date (or such
earlier date as may be specified by the Panel, or such later date as
Zoetis and Nexvet may, with (if required) the consent of the Panel,
agree and (if required) the High Court may allow).
2. The Scheme will be conditional upon:
(a) the approval of the Scheme by a majority in number of members of
each class of Nexvet Shareholders (including, but not limited to, as may
be directed by the High Court pursuant to Section 450(5) of the Act)
representing at least 75% in value of the Nexvet Shares of that class,
at the Voting Record Time, held by Nexvet Shareholders who are members
of that class of Nexvet Shareholders that are present and voting either
in person or by proxy, at the Scheme Meeting (or at any adjournment of
such meeting) held no later than the End Date;
(b) the EGM Resolutions being duly passed by the requisite majority of
Nexvet Shareholders at the EGM (or at any adjournment of such meeting)
held no later than the End Date;
(c) the sanction by the High Court (with or without modification (but
subject to such modification being acceptable to each of Nexvet and
Zoetis)) of the Scheme pursuant to Sections 449 to 455 of the Act and
the confirmation of the related reduction of capital involved therein by
the High Court on or before the End Date (the date on which the
Condition in this paragraph 2(c) is satisfied, the “Sanction Date”); and
(d) copies of the Court Order and the minute required by Section 86 of
the Act in respect of the reduction of capital (referred to in paragraph
2(c)) being delivered for registration to the Registrar of Companies and
registration of the Court Order and minute confirming the reduction of
capital involved in the Scheme by the Registrar of Companies on or
before the End Date.
3. Nexvet and Zoetis have agreed that, subject to paragraph 6 of this
Schedule 1, the Acquisition will also be conditional upon the following
matters having been satisfied or waived on or before the Sanction Date:
(a) save as provided in the Transaction Agreement and in the foregoing
Conditions, there not being any other corporate proceedings, steps or
actions on the part of Nexvet necessary to authorise the consummation of
the Acquisition;
(b) all required Clearances having been obtained and remaining in full
force and effect and all applicable waiting periods having expired,
lapsed or been terminated (as appropriate) in connection with any
applicable foreign investment Laws;
(c) no Governmental Body having instituted or implemented any action,
proceeding, investigation, enquiry or suit or having made, enforced,
enacted, issued or deemed applicable to the Acquisition any statute,
regulation or order or having withheld any consent which would:
(i) make the Acquisition or its implementation, void, illegal or
unenforceable or otherwise, directly or indirectly, materially restrain,
revoke, prohibit, materially restrict or delay the same or impose
materially additional or different conditions or obligations with
respect thereto which would, individually or in the aggregate, have or
reasonably be expected to have a material adverse effect on Zoetis or
Nexvet; or
(ii) result in a Material Restraint.
(d) the Transaction Agreement not having been terminated as a
consequence of any of the following events having occurred (such events
(including that set out in the Condition in paragraph 3(e) below) being
the events set out in the Transaction Agreement following the occurrence
of which the Transaction Agreement may be terminated in accordance with
its terms):
(i) the Scheme Meeting or the EGM having been completed and the Scheme
Meeting Resolution or the EGM Resolutions, as applicable, not having
been approved by the requisite majorities;
(ii) the Effective Time not having occurred by 5:00 p.m. on the End
Date, provided that the right to terminate the Transaction Agreement is
not exercised by a party to the Transaction Agreement whose breach of
any provision of the Transaction Agreement shall have been the primary
cause of the failure of the Effective Time to have occurred by such time;
(iii) the High Court having declined or refused to sanction the Scheme
and the decision of the High Court not having been appealed;
(iv) an injunction having been entered permanently restraining,
enjoining or otherwise prohibiting the consummation of the Acquisition
and having become final and non-appealable (provided that the right to
terminate the Transaction Agreement is not exercised by a party whose
breach of any provision of the Transaction Agreement shall have been the
primary cause of such injunction);
(v) any Zoetis Party having breached or failed to perform in any
material respect any of its covenants or other agreements contained in
the Transaction Agreement or any of its warranties set forth in the
Transaction Agreement having been inaccurate (as of the date of the
Transaction Agreement and at and as of the Sanction Date as though made
at and as of the Sanction Date provided that any warranties that
expressly relate to a particular period shall be true and correct only
with respect to such date or period), which material breach, failure to
perform or inaccuracy would result in a failure of any Conditions and is
not reasonably capable of being cured by the End Date (or, if curable,
is not cured within 30 days following Nexvet’s delivery of written
notice to Zoetis of such breach, failure to perform or inaccuracy
stating its intention to terminate the Transaction Agreement and the
reasons therefor);
(vi) Nexvet having breached or failed to perform in any material respect
any of its covenants or other agreements contained in the Transaction
Agreement or any of its warranties set forth in the Transaction
Agreement having been inaccurate (as of the date of the Transaction
Agreement and at and as of the Sanction Date as though made at and as of
the Sanction Date provided that any warranties that expressly relate to
a particular period shall be true and correct only with respect to such
date or period), which material breach, failure to perform or inaccuracy
would result in a failure of any Conditions and is not reasonably
capable of being cured by the End Date (or, if curable, is not cured
within 30 days following Zoetis’ delivery of written notice to Nexvet of
such breach, failure to perform or inaccuracy stating its intention to
terminate the Transaction Agreement and the reasons therefor);
(vii) a Nexvet Change of Recommendation having occurred or the Nexvet
Board or any committee having withdrawn (or modifying in any manner
adverse to Zoetis) or proposing publicly to withdraw (or modifying in
any manner adverse to Zoetis) the Scheme Recommendation; or
(viii) following Nexvet’s delivery of a Final Recommendation Change
Notice, Nexvet having provided Zoetis with written notice of its
termination of the Transaction Agreement;
(e) the Transaction Agreement not having been terminated by the mutual
written consent of Nexvet and Zoetis.
4. Zoetis shall have delivered to Nexvet a certificate, dated as of the
Sanction Date and signed by an executive officer of Zoetis, certifying
on behalf of Zoetis to the effect that the condition in paragraph
3(d)(v) has been satisfied.
5. Nexvet shall have delivered to Zoetis a certificate, dated as of the
Sanction Date and signed by an executive officer of Nexvet, certifying
on behalf of Nexvet to the effect that the condition in paragraph
3(d)(vi) has been satisfied.
6. Subject to the requirements of the Panel:
(a) Nexvet and Zoetis reserve the right (but shall be under no
obligation) to waive (to the extent permitted by applicable Law), in
whole or in part, all or any of the conditions in paragraph 3 (with the
exception of paragraphs 3(d)(v) and 3(d)(vi) (provided that both Parties
agree to any such waiver);
(b) Zoetis reserves the right (but shall be under no obligation) to
waive, in whole or in part, the condition in paragraph 3(d)(vi)); and
(c) Nexvet reserves the right (but shall be under no obligation) to
waive, in whole or in part, the condition in paragraph 3(d)(v).
7. The Scheme will lapse unless it is effective and unconditional by not
later than 5:00 p.m., (Eastern Time), on the End Date (or such earlier
date as may be specified by the Panel, or such later date as Nexvet and
Zoetis may, with (if required) the consent of the Panel, agree and (if
required) the High Court may allow.
8. Any references in the Conditions to a Condition being “satisfied”
upon receipt of any order, clearance, approval or consent from a
Governmental Body shall be construed as meaning that the foregoing have
been obtained, or where appropriate, made, terminated or expired in
accordance with the relevant Condition.
9. The Scheme will lapse unless it is effective on or prior to the End
Date or such later date (if any) as Zoetis and Nexvet may agree and (if
required) the Panel and the High Court may allow.
10. If Zoetis Bidco is required to make an offer for Nexvet Shares under
the provisions of Rule 9 of the Takeover Rules, Zoetis Bidco may make
such alterations to any of the Conditions set out above as are necessary
to comply with the provisions of that Rule.
11. Zoetis Bidco reserves the right, subject to the consent of the
Panel, to elect to implement the Acquisition by way of a Takeover Offer
as described in Clause 3.7 of the Transaction Agreement. Without
limiting Clause 3.7 of the Transaction Agreement, in such event, such
offer will be implemented on terms and conditions that are as least as
favourable to the Nexvet Shareholders (except for an acceptance
condition set at 80 per cent of the shares to which such offer relates
or such lesser percentage being more than 50 per cent, as Zoetis Bidco
may, with the consent of the Panel (if required), decide) as those which
would apply in relation to the Scheme.
Definitions
For the purposes of this Schedule 1:
“Acquisition” means the proposed acquisition by Zoetis Bidco of
Nexvet by means of the Scheme (as described in this Announcement) or a
Takeover Offer (and any such Scheme or Takeover Offer as it may be
revised, amended or extended from time to time) (including the payment
by Zoetis Bidco of the aggregate cash consideration pursuant to the
Scheme or such Takeover Offer) pursuant to this Agreement;
“Act” means the Companies Act 2014, all enactments which are to
be read as one with, or construed or read together as one with the
Companies Act 2014 and every statutory modification and re-enactment
thereof for the time being in force;
“Announcement” means this announcement;
“Articles of Association” means the articles of association of
Nexvet as filed with the Registrar of Companies;
“Clearances” means all consents, licences, authorisations,
clearances, approvals, permissions, permits, non-actions,
qualifications, orders and waivers required to be obtained from and
issued by, and all registrations, applications, notices, submissions and
filings required to be made with or provided to, any Person;
“Court Order” means the order or orders of the High Court
sanctioning the Scheme under Section 453 of the Act and confirming the
related reduction of capital that forms part of it under Sections 84 and
85 of the Act;
“Effective Time” means the time on the Effective Date at which
the Court Order and a copy of the minute required by Section 86 of the
Act are registered by the Registrar of Companies or, as the case may be,
the Takeover Offer becomes (or is declared) unconditional in all
respects;
“EGM” means the extraordinary general meeting of Nexvet
Shareholders (and any adjournment thereof) to be convened in connection
with the Scheme, expected to be convened as soon as the Scheme Meeting
shall have been concluded (it being understood that if the Scheme
Meeting is adjourned, the EGM shall be correspondingly adjourned);
“EGM Resolutions” means the resolutions to be proposed at the EGM
for the purposes of approving and implementing the Scheme, the related
reduction of capital of Nexvet, changes to the Articles of Association
(including as contemplated by the Transaction Agreement) and such other
matters as Nexvet reasonably determines to be necessary for the purposes
of implementing the Acquisition or, subject to the consent of Zoetis
(such consent not to be unreasonably withheld or delayed), desirable for
the purposes of implementing the Scheme or the Acquisition;
“EMA” means the European Medicines Agency;
“End Date” means the date that is: (i) six months after the date
hereof; or (ii) nine months after the date hereof where the directions
hearing of the High Court (following the approval of the Scheme
Resolution) to set a date for the Court Hearing of the petition to
sanction the Scheme and other related matters (such as advertising
requirements) has not been held and concluded by Monday, July 30 2017 at
the latest, or, in either case, such later date as Zoetis and Nexvet
may, with (if required) the consent of the Panel, agree and (if
required) the High Court may allow;
“Exchange Act” means the United States Securities Exchange Act of
1934, as amended;
“Final Recommendation Change Notice” has the meaning given to
that term in Clause 5.2(e) of the Transaction Agreement;
“FDA” means the United States Food and Drug Administration;
“Governmental Body” means any Irish, United States, foreign or
supranational, federal, state, local or other governmental or regulatory
authority, agency in any jurisdiction, commission, board, body, bureau,
arbitrator, arbitration panel, or other authority, agency, including
courts and other judicial bodies, or any competition, antitrust, foreign
investment review or supervisory body, central bank or other
governmental, trade or regulatory agency or body, securities exchange
(including NASDAQ and NYSE) or any self-regulatory body or authority,
including any instrumentality or entity designed to act for or on behalf
of the foregoing, in each case, in any jurisdiction (provided it has
jurisdiction over the applicable Person or its activities or property),
including the Panel, the High Court, the SEC, the FDA, the USDA, the
EMA, the Health Products Regulatory Authority (of Ireland) and the Irish
Department of Agriculture, Food and the Marine;
“High Court” means the High Court of Ireland;
“Ireland” means the island of Ireland, excluding Northern Ireland
(the counties of Antrim, Armagh, Derry, Down, Fermanagh and Tyrone), and
the word “Irish” shall be construed accordingly;
“Law” means any applicable federal, state, local, municipal,
foreign, supranational or other law, statute, constitution, principle of
common law, resolution, ordinance, code, agency requirement, licence,
permit, edict, binding directive, decree, rule, regulation, judgment,
order, injunction, ruling or requirement issued, enacted, adopted,
promulgated, implemented or otherwise put into effect by or under the
authority of any Governmental Body;
“Material Restraint” means any requirement of any entity,
(including its Subsidiaries) (a) to divest, hold, separate or otherwise
take any action that limits such entity’s freedom of action, ownership
or control with respect to, or its ability to retain or hold, directly
or indirectly, any of its businesses, assets, equity interests, product
lines or properties or any equity interest in any joint venture held by
such entity, (b) to license any intellectual property of either the
Zoetis Group or the Nexvet Group, (c) that would reasonably be expected
to impose any limitation on or result in a material delay in the ability
of Zoetis to acquire, or to hold or to exercise effectively, directly or
indirectly, all or any rights of ownership of shares (or the equivalent)
in or to exercise voting or management control over, Nexvet or any
member of the Nexvet Group, (d) that would impose a limitation on the
ability of Zoetis or its Subsidiaries to integrate or co-ordinate its
business, or any part of it, with the business of the Nexvet Group, or
(e) that would result in a member of the Zoetis Group or the Nexvet
Group ceasing to be able to carry on business in any jurisdiction in
which it does business as at the date of this Announcement, which would,
individually or in the aggregate, have or reasonably be expected to have
a material adverse effect on Zoetis or Nexvet;
“NASDAQ” means the NASDAQ Stock Market;
“Nexvet” means Nexvet Biopharma public limited company, a public
company limited by shares incorporated in Ireland under registration
number 547923 having its registered office at Unit 5, Sragh Business
Park, Rahan Road, Tullamore, Co. Offaly;
“Nexvet Board” means the board of directors of Nexvet from time
to time and for the time being;
“Nexvet Change of Recommendation” has the meaning given to that
term in Clause 5.2(d)(ii) of the Transaction Agreement;
“Nexvet Group” means Nexvet and all of its Subsidiaries;
“Nexvet Shareholders” means the holders of Nexvet Shares;
“Nexvet Shares” means the existing unconditionally allotted or
issued and fully paid ordinary shares with a nominal value of US$ 0.125
each in the capital of Nexvet and any further such shares which are
unconditionally allotted or issued before the date on which the Scheme
is effective;
“Panel” means the Irish Takeover Panel;
“Parties” means Nexvet, Zoetis and Zoetis Bidco, and “Party”
shall mean either Nexvet, Zoetis or Zoetis Bidco (as the context
requires);
“Registrar of Companies” means the Registrar of Companies in
Dublin, Ireland as defined in Section 2 of the Act;
“Sanction Date” has the meaning given to such expression in
paragraph 2(c) of this Schedule 1;
“Scheme” means the proposed scheme of arrangement under Chapter 1
of Part 9 of the Act and the related capital reduction under Sections 84
and 85 of the Act to effect the Acquisition pursuant to the Transaction
Agreement, on the terms (including the conditions to the Scheme and the
Acquisition) and for the consideration set out in this Announcement and
on such other terms and in such form not being inconsistent therewith as
the Parties mutually agree in writing, including any revision thereof as
may be so agreed between the Parties and, if required, by the High Court;
“Scheme Document” means a document (or relevant sections of the
Proxy Statement comprising the scheme document), including any
amendments or supplements thereto, to be distributed as part of the
Proxy Statement to Nexvet Shareholders and, for information only, to
holders of Nexvet Convertible Securities, containing:
(a) the Scheme;
(b) the notice or notices of the Scheme Meeting and the EGM;
(c) an explanatory statement as required by Section 452 of the Act with
respect to the Scheme;
(d) such other information as may be necessary or appropriate pursuant
to the Act, the Exchange Act or the Takeover Rules (or required by the
Panel); and
(e) such other information as Nexvet and Zoetis shall agree, each acting
reasonably;
“Scheme Meeting” means the meeting or meetings of Nexvet
Shareholders or, if applicable, any class or classes of Nexvet
Shareholders (including, but not limited to, as may be directed by the
High Court pursuant to Section 450(5) of the Act) (and any adjournment
of any such meeting or meetings) convened by (i) resolution of the
Nexvet Board or (ii) order of the High Court, in either case pursuant to
Section 450 of the Act, to consider and vote on the Scheme Meeting
Resolution;
“Scheme Meeting Resolution” means the resolution to be considered
and voted on at the Scheme Meeting proposing that the Scheme, with or
without amendment (but subject to such amendment being acceptable to
each of Nexvet and Zoetis, except for a technical or procedural
amendment which is required for the proper implementation of the Scheme
and does not have a substantive consequence on the implementation of the
Scheme) , be agreed to;
“SEC” means the United States Securities and Exchange Commission;
“Takeover Rules” means the Irish Takeover Panel Act 1997,
Takeover Rules 2013;
“Transaction Agreement” means the transaction agreement entered
into between Nexvet, Zoetis and Zoetis Bidco dated 13 April 2017
relating to, amongst other things, the implementation of the Acquisition
as described in paragraph 14 of this Announcement;
“USDA” means the United States Department of Agriculture;
“Voting Record Time” means the time and date to be specified as
the voting record time for the Scheme Meeting (or any adjournment
thereof) in the Scheme Document;
“Zoetis” means Zoetis Inc., a company incorporated in the United
States having its registered address at 10 Sylvan Way, Parsippany, NJ
07054;
“Zoetis Bidco” means Zoetis Belgium SA, a limited liability
company (société anonyme) incorporated under the laws of Belgium,
having its registered office at rue Laid Burniat 1, B-1348
Louvain-la-Neuve, and registered in the Crossroads Bank of Enterprises
under number 0401.953.350 (RLE Nivelles); and
“Zoetis Group” means, collectively, Zoetis and all of its
Subsidiaries, including Zoetis Bidco.
SCHEDULE 2
Sources and Bases of Information
In this Announcement, unless otherwise stated or the context otherwise
requires, the following sources and bases have been used:
a) Unless otherwise stated, the financial information relating to Nexvet
is extracted from the Annual Report on Form 10-K for the fiscal year
ended 30 June 2016, the Form 10-Q for the quarterly period ended 30
September 2016 and the unaudited consolidated balance sheet of Nexvet as
of 28 February 2017.
b) The value of the Acquisition is based upon the Consideration due
under the terms of the Acquisition and on the basis of the issued and to
be issued share capital of Nexvet referred to in paragraph (c) below.
c) The issued and to be issued share capital of Nexvet is calculated on
the basis of:
i. the number of issued Nexvet ordinary shares as at the close of
business on 12 April 2017 (being the last practicable date prior to the
release of this Announcement), being 11,910,615 Nexvet ordinary shares
(excluding treasury shares); and
ii. the number of Nexvet ordinary shares which may be issued (net of
proceeds payable on the exercise of Nexvet Convertible Securities) on or
after the date of this Announcement and prior to the Effective Date on
the exercise of Nexvet Convertible Securities, which have been granted
or are expected to be granted on or before the Effective Date, amounting
in aggregate to 735,915 Nexvet ordinary shares.
d) Unless otherwise stated, all prices for Nexvet Shares are the Closing
Price for the relevant dates.
e) References to the arrangements in place between Zoetis and Nexvet
regarding an expenses reimbursement agreement are sourced from the terms
of the Expenses Reimbursement Agreement approved by the Panel referred
to in paragraph 13.
f) References to the arrangements in place between Zoetis and Nexvet
regarding a transaction agreement are sourced from the terms of the
Transaction Agreement referred to in paragraph 14.
g) References to the voting arrangements in place between Zoetis, Nexvet
and certain Nexvet Shareholders regarding the Acquisition are sourced
from the terms of the irrevocable undertakings referred to in paragraph
15.
SCHEDULE 3
Definitions
1. In this Announcement, save where the context clearly requires
otherwise, the following expressions shall have the following meanings:
“Acquisition” means the proposed acquisition by Zoetis Bidco of
Nexvet by means of the Scheme (as described in this Announcement) or a
Takeover Offer (and any such Scheme or Takeover Offer as it may be
revised, amended or extended from time to time) (including the payment
by Zoetis Bidco of the aggregate cash consideration pursuant to the
Scheme or such Takeover Offer) pursuant to this Agreement;
“Act” means the Companies Act 2014, all enactments which are to
be read as one with, or construed or read together as one with the
Companies Act 2014 and every statutory modification and re-enactment
thereof for the time being in force;
“Acting in Concert” has the meaning given to that term in the
Takeover Panel Act;
“Announcement” means this announcement;
“Articles of Association” means the articles of association of
Nexvet as filed with the Registrar of Companies;
“Business Day” means any day, other than a Saturday, Sunday,
public holiday or a day on which banks in Ireland or in the State of New
York are authorised or required by law or executive order to be closed;
“Buyback Options” means options to purchase Nexvet Shares at an
exercise price of $6.35 per share and an option expiry date of 5:00 p.m.
Irish time on 28 February 2018 granted pursuant to Nexvet Options terms
of issue and which are exercisable in respect of 145,069 Nexvet Shares;
“Cancellation Record Time” means the date and time specified in
the Scheme Document as the “Cancellation Record Time”;
“Closing Price” means, with respect to any Trading Day, the last
price at which a Nexvet Share traded during a regular trading session on
the NASDAQ on such day, as reported based on share prices from Bloomberg;
“Concert Parties” means, in relation to any Party, such persons
as are deemed to be Acting in Concert with that Party pursuant to Rule
3.3 of Part A of the Takeover Rules and such persons as are Acting in
Concert with that Party;
“Conditions” means the conditions to the Scheme and the
Acquisition set forth in Schedule 1, and “Condition” means any
one of the Conditions;
“Consideration” means US$6.72 in cash per Nexvet Share cancelled
pursuant to the Scheme;
“Court Order” means the order or orders of the High Court
sanctioning the Scheme under Section 453 of the Act and confirming the
related reduction of capital that forms part of it under Sections 84 and
85 of the Act;
“Cowen” means Cowen and Company LLC;
“Effective” means the Scheme having become effective pursuant to
its terms or if the Acquisition is implemented by way of a Takeover
Offer, the Takeover Offer having become (or having been declared)
unconditional in all respects in accordance with the provisions of the
Takeover Offer Documents and the requirements of the Takeover Rules;
“Effective Date” means (i) the date on which the Scheme becomes
effective in accordance with its terms or (ii) if the Acquisition is
implemented by way of a Takeover Offer, the Takeover Offer having become
(or having been declared) unconditional in all respects in accordance
with the provisions of the Takeover Offer Documents and the requirements
of the Takeover Rules;
“EGM” means the extraordinary general meeting of Nexvet
Shareholders (and any adjournment thereof) to be convened in connection
with the Scheme, expected to be convened as soon as the Scheme Meeting
shall have been concluded (it being understood that if the Scheme
Meeting is adjourned, the EGM shall be correspondingly adjourned);
“EGM Resolutions” means the resolutions to be proposed at the EGM
for the purposes of approving and implementing the Scheme, the related
reduction of capital of Nexvet, changes to the Articles of Association
(including as contemplated by the Transaction Agreement) and such other
matters as Nexvet reasonably determines to be necessary for the purposes
of implementing the Acquisition or, subject to the consent of Zoetis
(such consent not to be unreasonably withheld or delayed), desirable for
the purposes of implementing the Scheme or the Acquisition;
“EMA” means the European Medicines Agency;
“End Date” means the date that is: (i) six months after the date
hereof; or (ii) nine months after the date hereof where the directions
hearing of the High Court (following the approval of the Scheme
Resolution) to set a date for the Court Hearing of the petition to
sanction the Scheme and other related matters (such as advertising
requirements) has not been held and concluded by Monday, July 30 2017 at
the latest, or, in either case, such later date as Zoetis and Nexvet
may, with (if required) the consent of the Panel, agree and (if
required) the High Court may allow;
“Evercore” means Evercore Partners International LLP;
“Exchange Act” means the United States Securities Exchange Act of
1934, as amended;
“Expenses Reimbursement Agreement” means the expenses
reimbursement agreement dated 13 April 2017 between Zoetis and Nexvet,
the terms of which have been approved by the Panel, as described in
paragraph 13 of this Announcement;
“FDA” means the United State Food and Drug Administration;
“FINRA” means the Financial Industry Regulatory Authority;
“Goldman Sachs” means Goldman, Sachs & Co. and Goldman Sachs
International (in their capacity as financial adviser to Zoetis);
“Governmental Body” means any Irish, United States, foreign or
supranational, federal, state, local or other governmental or regulatory
authority, agency in any jurisdiction, commission, board, body, bureau,
arbitrator, arbitration panel, or other authority, agency, including
courts and other judicial bodies, or any competition, antitrust, foreign
investment review or supervisory body, central bank or other
governmental, trade or regulatory agency or body, securities exchange
(including NASDAQ and NYSE) or any self-regulatory body or authority,
including any instrumentality or entity designed to act for or on behalf
of the foregoing, in each case, in any jurisdiction (provided it has
jurisdiction over the applicable Person or its activities or property),
including the Panel, the High Court, the SEC, the FDA, the USDA, the
EMA, the Health Products Regulatory Authority (of Ireland) and the Irish
Department of Agriculture, Food and the Marine;
“High Court” means the High Court of Ireland;
“Ireland” means the island of Ireland, excluding Northern Ireland
(the counties of Antrim, Armagh, Derry, Down, Fermanagh and Tyrone), and
the word “Irish” shall be construed accordingly;
"Irrecoverable VAT" in relation to any person, any amount in
respect of VAT which that person (or a member of the same VAT Group as
that person) has incurred and in respect of which neither that person
nor any other member of the same VAT Group as that person is entitled to
a refund (by way of credit or repayment) from any relevant Tax Authority
pursuant to and determined in accordance with section 59 of the Irish
Value Added Tax Consolidation Act 2010 and any regulations made under
that act or similar provision in any other jurisdiction;
“Law” means any applicable federal, state, local, municipal,
foreign, supranational or other law, statute, constitution, principle of
common law, resolution, ordinance, code, agency requirement, licence,
permit, edict, binding directive, decree, rule, regulation, judgment,
order, injunction, ruling or requirement issued, enacted, adopted,
promulgated, implemented or otherwise put into effect by or under the
authority of any Governmental Body;
“Meetings” mean the Scheme Meeting and the EGM, and Meeting means
either of them as the context requires;
“NASDAQ” means the NASDAQ Stock Market;
“Nexvet” means Nexvet Biopharma public limited company, a public
company limited by shares incorporated in Ireland under registration
number 547923 having its registered office at Unit 5, Sragh Business
Park, Rahan Road, Tullamore, Co. Offaly;
“Nexvet 2012 Plan” means the Nexvet Employee Share Plan governed
by the Employee Share Plan dated 29 August 2012 adopted by the board of
directors of Nexvet Biopharma Pty Limited on 29 August 2012;
“Nexvet 2013 Australian Plan” means the Nexvet Long Term
Incentive Plan governed by the Long Term Incentive Plan Rules dated 5
November 2013 and adopted by the board of directors of Nexvet Biopharma
Pty Limited on 30 October 2013;
“Nexvet 2013 Plan” means the Nexvet Long Term Incentive Plan
governed by the Long Term Incentive Plan Rules dated 4 September 2014
and adopted by the Nexvet Board on 18 September 2014;
“Nexvet 2015 Plan” means the Nexvet Biopharma Public Limited
Company 2015 Equity Incentive Plan as adopted by the Nexvet Board on 14
October 2014, as amended by the Nexvet Board on 16 January 2015 and as
further amended by the Compensation Committee (as defined therein) on 2
September 2015;
“Nexvet Alternative Proposal” means any bona fide proposal or
bona fide offer, which proposal or offer may be subject to due
diligence, definitive documentation or both, made by any person (other
than a proposal or offer pursuant to Rule 2.5 of the Takeover Rules by
Zoetis or any of its Concert Parties) for:
(a) a merger, reorganisation, share exchange, consolidation, business
combination, recapitalisation, dissolution, liquidation or similar
transaction involving Nexvet that, if consummated, would result in any
Person beneficially owning shares with more than 20% of the voting power
of Nexvet;
(b) the direct or indirect acquisition by any Person of more than 20% of
the value of the assets of the Nexvet Group, taken as a whole; or
(c) the direct or indirect acquisition by any Person of more than 20% of
the voting power or the issued share capital of Nexvet, including any
offer or exchange offer that if consummated would result in any Person
beneficially owning shares with more than 20% of the voting power of
Nexvet;
“Nexvet Board” means the board of directors of Nexvet from time
to time and for the time being;
“Nexvet Change of Recommendation” has the meaning given to that
term in Clause 5.2(d)(ii) of the Transaction Agreement;
“Nexvet Convertible Securities” means all issued and outstanding
securities (including, but not limited to, all options, restricted share
units, warrants and/or other convertible securities issued pursuant the
Nexvet Plans) which are convertible, exchangeable or exercisable into
Nexvet Shares;
“Nexvet Directors” mean the members of the Nexvet Board;
“Nexvet Group” means Nexvet and all of its Subsidiaries;
“Nexvet Options” means options to purchase Nexvet Shares granted
pursuant to the Buyback Options, the Nexvet 2013 Plan or the Nexvet 2015
Plan;
“Nexvet Plans” means the Nexvet 2012 Plan, the Buyback Options,
the Nexvet 2013 Australian Plan, the Nexvet 2013 Plan and the Nexvet
2015 Plan;
“Nexvet Shareholders” means the holders of Nexvet Shares;
“Nexvet Shares” means the existing unconditionally allotted or
issued and fully paid ordinary shares with a nominal value of US$ 0.125
each in the capital of Nexvet and any further such shares which are
unconditionally allotted or issued before the date on which the Scheme
is effective;
“Nexvet Superior Proposal” means a written bona fide Nexvet
Alternative Proposal (where each reference to 20% set forth in the
definition of such term shall be deemed to refer to 50%, but provided
that such Nexvet Alternative Proposal may not be subject to due
diligence or definitive documentation (other than the execution
thereof)) that the Nexvet Board determines in good faith (after
consultation with Nexvet’s financial advisers and outside legal counsel)
is more favourable to Nexvet Shareholders than the Acquisition, taking
into account such financial, regulatory, legal, structuring, timing and
other aspects of such proposal as the Nexvet Board considers to be
appropriate;
“NYSE” means the New York Stock Exchange;
“Offer” or “Takeover Offer” means an offer in accordance
with Clause 3.7 of the Transaction Agreement for the entire issued and
to be issued share capital of Nexvet (other than any Nexvet Shares
beneficially owned by any member of Zoetis Group (if any)), including
any amendment or revision thereto pursuant to the Transaction Agreement,
the full terms of which would be set out in the Takeover Offer Documents
or (as the case may be) any revised offer document(s);
“Offer Period” means the period commencing on 13 April 2017 and
ending on the earlier of the date on which the Acquisition becomes
Effective and the date on which the Acquisition lapses or is withdrawn
(or such other date at the Panel may decide or the Takeover Rules
dictate);
“Panel” means the Irish Takeover Panel;
“Parties” means Nexvet, Zoetis and Zoetis Bidco, and “Party”
shall mean either Nexvet, Zoetis or Zoetis Bidco (as the context
requires);
“Person” or “person” means an individual, group (including
a “group” under Section 13(d) of the Exchange Act), corporation,
partnership, limited liability company, joint venture, association,
trust, unincorporated organisation or other entity or any Governmental
Body or any department, agency or political subdivision thereof;
“Proposals” means the Scheme and other matters relevant thereto
to be considered by Nexvet Shareholders at the Meetings;
“Proxy Statement” means the proxy statement of Nexvet (including
any amendments or supplements thereto), to be filed with the SEC and
mailed to Nexvet Shareholders, comprising (i) the Scheme Document, (ii)
the notices of the Scheme Meeting and EGM, (iii) an explanatory
statement as required by Section 452 of the Act with respect to the
Scheme, (iv) such other information as may be required or necessary
pursuant to the Act and the Takeover Rules or required by the Panel and
(v) such other information as Nexvet and Zoetis agree;
“Registrar of Companies” means the Registrar of Companies in
Dublin, Ireland as defined in Section 2 of the Act;
“Relevant Securities” has the meaning assigned to it by the
Takeover Rules;
“Resolutions” means, collectively, the Scheme Meeting Resolution
and the EGM Resolutions, which will be set out in the Scheme Document;
“Restricted Jurisdiction” means any jurisdiction in, into or from
which the release, publishing or distribution of this Announcement in
whole or in part would or might infringe the laws of that jurisdiction
or would or might require compliance with any governmental or other
consent or any registration or other formality that either party is
unable to comply with or regards as unduly onerous to comply with;
“Scheme” means the proposed scheme of arrangement under Chapter 1
of Part 9 of the Act and the related capital reduction under Sections 84
and 85 of the Act to effect the Acquisition pursuant to the Transaction
Agreement, on the terms (including the conditions to the Scheme and the
Acquisition) and for the consideration set out in this Announcement and
on such other terms and in such form not being inconsistent therewith as
the Parties mutually agree in writing, including any revision thereof as
may be so agreed between the Parties and, if required, by the High Court;
“Scheme Document” means a document (or relevant sections of the
Proxy Statement comprising the scheme document), including any
amendments or supplements thereto, to be distributed as part of the
Proxy Statement to Nexvet Shareholders and, for information only, to
holders of Nexvet Convertible Securities, containing:
(a) the Scheme;
(b) the notice or notices of the Scheme Meeting and the EGM;
(c) an explanatory statement as required by Section 452 of the Act with
respect to the Scheme;
(d) such other information as may be necessary or appropriate pursuant
to the Act, the Exchange Act or the Takeover Rules (or required by the
Panel); and
(e) such other information as Nexvet and Zoetis shall agree, each acting
reasonably;
“Scheme Meeting” means the meeting or meetings of Nexvet
Shareholders or, if applicable, any class or classes of Nexvet
Shareholders (including, but not limited to as may be directed by the
High Court pursuant to Section 450(5) of the Act) (and any adjournment
of any such meeting or meetings) convened by (i) resolution of the
Nexvet Board or (ii) order of the High Court, in either case pursuant to
Section 450 of the Act, to consider and vote on the Scheme Meeting
Resolution;
“Scheme Meeting Resolution” means the resolution to be considered
and voted on at the Scheme Meeting proposing that the Scheme, with or
without amendment (but subject to such amendment being acceptable to
each of Nexvet and Zoetis, except for a technical or procedural
amendment which is required for the proper implementation of the Scheme
and does not have a substantive consequence on the implementation of the
Scheme), be agreed to;
“Scheme Recommendation” means the unanimous recommendation of the
Nexvet Board that Nexvet Shareholders vote in favour of the Resolutions;
“SEC” means the United States Securities and Exchange Commission;
“Subsidiary” means in relation to any person, any corporation,
partnership, association, trust or other form of legal entity of which
such person directly or indirectly owns securities or other equity
interests representing more than 50% of the aggregate voting power;
“Takeover Offer Documents” means if following the date hereof,
Zoetis elects to implement the Acquisition by way of Takeover Offer in
accordance with Clause 3.7 of the Transaction Agreement, the documents
to be despatched to Nexvet Shareholders and others by Zoetis Bidco
containing, amongst other things, the Takeover Offer, the Conditions
(save insofar as not appropriate in the case of a Takeover Offer, and as
amended in such manner as Zoetis and Nexvet shall determine, and the
Panel shall agree, to be necessary to reflect the terms of the Takeover
Offer) and certain information about Zoetis, Zoetis Bidco and Nexvet
and, where the context so admits, includes any form of acceptance,
election, notice or other document reasonably required in connection
with the Takeover Offer;
“Takeover Panel Act” means the Irish Takeover Panel Act 1997, as
amended;
“Takeover Rules” means the Irish Takeover Panel Act 1997,
Takeover Rules 2013;
“Tax” (or “Taxes” and, with correlative meaning, the term “Taxable”)
means all national, federal, state, local or other taxes imposed by the
United States, Ireland, and any Governmental Body or other Tax
Authority, including income, gain, profits, windfall profits, franchise,
gross receipts, environmental, customs duty, capital stock, severances,
stamp, payroll, universal social charge, pay related social insurance
and other similar contributions, sales, employment, unemployment,
disability, use, property, gift tax, inheritance tax, unclaimed
property, escheat, withholding, excise, production, value added, goods
and services, trading, occupancy and other taxes, duties or assessments
of any nature whatsoever, or state aid related thereto, together with
all interest, penalties, surcharges and additions imposed with respect
to such amounts and any interest in respect of such penalties and
additions, whether disputed or not, and any liability in respect of any
of the foregoing items payable by reason of contract, assumption,
transferee or successor liability;
“Tax Authority” means any Governmental Body responsible
for the assessment, collection or enforcement of laws relating to Taxes
or for making any decision or ruling on any matter relating to Tax
(including the US Internal Revenue Service and the Irish Revenue
Commissioners);
“Trading Day” means any day on which the NASDAQ is open for
business;
“Transaction Agreement” means the transaction agreement entered
into between Nexvet, Zoetis and Zoetis Bidco dated 13 April 2017
relating to, amongst other things, the implementation of the Acquisition
as described in paragraph 14 of this Announcement;
“USDA” means the United States Department of Agriculture;
“U.S.” or “United States” means the United States of
America, its territories and possessions, any State of the United States
of America and the District of Columbia, and all other areas subject to
its jurisdiction;
“US$”, “$” or “USD”, means United States dollars,
the lawful currency of the United States of America;
“VAT” any tax imposed by any member state of the European
Community in conformity with the Directive of the Council of the
European Union on the common system of value added tax (2006/112/EC);
“VAT Group” a group as defined in Section 15 of the Irish Value
Added Tax Consolidation Act 2010 and any similar VAT grouping
arrangement in any other jurisdiction;
“
Voting Record Time” means the time and date to be
specified as the voting record time for the Scheme Meeting (or any
adjournment thereof) in the Scheme Document;
“Zoetis” means Zoetis Inc., a company incorporated in the United
States having its registered address at 10 Sylvan Way, Parsippany, NJ
07054;
“Zoetis Bidco” means Zoetis Belgium S.A., a limited liability
company (société anonyme) incorporated under the laws of Belgium,
having its registered office at rue Laid Burniat 1, B-1348
Louvain-la-Neuve, and registered in the Crossroads Bank of Enterprises
under number 0401.953.350 (RLE Nivelles);
“Zoetis Group” means, collectively, Zoetis and all of its
Subsidiaries, including Zoetis Bidco; and
“€”, “EUR” or “euro” means the lawful currency of
Ireland.
2. All amounts contained within this Announcement referred to by “€” and
“c” refer to the euro and cent and amounts contained within this
Announcement referred to by “US$” or “$” refer to the U.S. dollar
amounts.
3. Any reference to any provision of any legislation shall include any
amendment, modification, re-enactment or extension thereof. Any
reference to any legislation is to Irish legislation unless specified
otherwise.
4. Words importing the singular shall include the plural and vice versa
and words importing the masculine gender shall include the feminine or
neutral gender.
5. All times referred to are U.S. Eastern Time unless otherwise stated.
SCHEDULE 4
Transaction Agreement
DATED APRIL 13, 2017
NEXVET BIOPHARMA PUBLIC LIMITED COMPANY
ZOETIS INC.
ZOETIS BELGIUM S.A.,
__________________________________________
TRANSACTION AGREEMENT
__________________________________________
CONTENTS
1. INTERPRETATION 1
2. RULE 2.5 ANNOUNCEMENT AND SCHEME DOCUMENT 14
3. IMPLEMENTATION OF THE SCHEME 15
4. RULE 15 PROPOSALS 24
5. TARGET AND ZOETIS CONDUCT 26
6. WARRANTIES 30
7. ADDITIONAL AGREEMENTS 51
8. COMPLETION OF ACQUISITION 58
9. TERMINATION 59
10. GENERAL 61
SCHEDULE 1
TARGET CONDUCT 66
SCHEDULE 2
SEVERANCE FORMULA 71
SCHEDULE 3
RULE 2.5 ANNOUNCEMENT 73
THIS AGREEMENT is made on April 13, 2017
BETWEEN:
(1) NEXVET BIOPHARMA PUBLIC LIMITED COMPANY, an Irish public
limited company, having its principal place of business at Unit 5, Sragh
Technology Park, Tullamore, Co. Offaly, Ireland (“Target”);
(2) ZOETIS INC., a Delaware corporation, with a principal place
of business at 10 Sylvan Way, Parsippany, New Jersey 07054 (“Zoetis”);
and
(3) ZOETIS BELGIUM S.A., a limited liability company (société
anonyme) incorporated under the laws of Belgium, having its registered
office at rue Laid Burniat 1, B-1348 Louvain-la-Neuve, and registered in
the Crossroads Bank of Enterprises under number 0401.953.350 (RLE
Nivelles) (“Zoetis Bidco”)
RECITALS:
(A) Zoetis has agreed to make a proposal to cause Zoetis Bidco to
acquire Target on the terms set out in the Rule 2.5 Announcement (as
defined below).
(B) This Transaction Agreement (this “Agreement”) sets out
certain matters relating to the conduct of the Acquisition (as defined
below) that have been agreed by the Parties (as defined below).
(C) The Parties intend that the Acquisition will be implemented by way
of the Scheme (as defined below), although this may, subject to the
consent of the Panel (where required), be switched to a Takeover Offer
(as defined below) in accordance with the terms set out in this
Agreement.
IT IS AGREED as follows:
1. Interpretation
1.1 Definitions
In this Agreement, including the Recitals, the following words and
expressions shall have the meanings set opposite them:
“Acquisition” means the proposed acquisition by Zoetis Bidco of
Target by means of the Scheme (as described in the Rule 2.5
Announcement) or a Takeover Offer (and any such Scheme or Takeover Offer
as it may be revised, amended or extended from time to time) (including
the payment by Zoetis Bidco of the aggregate cash consideration pursuant
to the Scheme or such Takeover Offer) pursuant to this Agreement;
“Act” means the Companies Act 2014, all enactments which are to
be read as one with, or construed or read together as one with the
Companies Act 2014 and every statutory modification and re-enactment
thereof for the time being in force;
“Acting in Concert” has the meaning given to that term in the
Takeover Panel Act;
“Action” means any lawsuit, claim, complaint, action or
proceeding before any Governmental Body;
“Adverse Event” means any adverse event associated with the use
of a Target Product covered by this Agreement, whether or not considered
to be Target Product related, and whether or not the Target Product was
used in accordance with directions, including (i) an adverse event
occurring in animals in the course of the use of a Target Product by a
veterinarian or other animal owner or caretaker, (ii) failure of a
Target Product to produce its expected pharmacological or clinical
effect (lack of expected effectiveness), (iii) an adverse event
occurring in humans from exposure during manufacture, testing, handling
or use of a Target Product;
“Affiliate” means in relation to any person, another person that,
directly or indirectly, controls, is controlled by, or is under common
control with, such first person (as used in this definition, “control”
(including, with its correlative meanings, “controlled by” and “under
common control with”) shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of management or policies
of a person, whether through the ownership of securities or partnership
or other ownership interests, by Contract or otherwise);
“Agreement” has the meaning given to that term in the Recitals;
“Articles of Association” means the articles of association of
Target as filed with the Registrar of Companies;
“Benefit Plan” means each (i) employee benefit plan (as defined
in Section 3(3) of ERISA, whether or not subject thereto), (ii) bonus,
stock option, stock purchase, stock ownership, restricted stock, equity,
phantom-equity or other equity-based, incentive, deferred compensation,
retirement, pension, profit sharing, retiree medical, life insurance,
supplemental retirement, vacation, medical, dental, vision,
prescription, cafeteria, material fringe benefit, relocation or
expatriate benefit, perquisite, disability, accident, leave, employee
assistance, supplemental unemployment benefit or other compensation or
benefit plans, programs, agreements or arrangements, and (iii)
employment, termination, severance, redundancy, layoff, change in
control, salary continuation, transaction bonus, retention or other
plans, programs, agreements or arrangements, in each case whether
written or oral, and whether for the benefit of one individual or more
than one individual;
“Business Day” means any day, other than a Saturday, Sunday,
public holiday or a day on which banks in Ireland or in the State of New
York are authorised or required by law or executive order to be closed;
“Buyback Options” means options to purchase Target Shares at an
exercise price of $6.35 per share and an option expiry date of 5:00 p.m.
Irish time on February 28, 2018 granted pursuant to Target’s options
terms of issue and which are exercisable in respect of 145,069 Target
Shares;
“Capitalisation Date” has the meaning given to that term in
Clause 6.1(c)(i);
“Clearances” means all consents, licences, authorisations,
clearances, approvals, permissions, permits, non-actions,
qualifications, orders and waivers required to be obtained from and
issued by, and all registrations, applications, notices, submissions and
filings required to be made with or provided to, any Person;
“Code” means the US Internal Revenue Code of 1986, as amended;
“Completion” means completion of the Acquisition;
“Completion Date” has the meaning given to that term in
Clause 8.1(a);
“Concert Parties” means in relation to any Party, such persons as
are deemed to be Acting in Concert with that Party pursuant to Rule 3.3
of Part A of the Takeover Rules and such persons as are Acting in
Concert with that Party;
“Conditions” means the conditions to the Scheme and the
Acquisition set forth in Schedule 1 to the Rule 2.5 Announcement, and “Condition”
means any one of the Conditions;
“Consideration” means US$6.72 per Target Share;
“Contract” means any legally binding written, oral or other
agreement, amendment, contract, subcontract, lease, understanding,
instrument, note, debenture, indenture, warrant, option, warranty,
purchase order, licence, sublicence, insurance policy or other similar
legally binding commitment or undertaking of any nature;
“Copyrights” means any and all US and foreign copyrights, mask
works and all other rights with respect to software, websites, content,
images, graphics, text, photographs, artwork, audio-visual works, sound
recordings, graphs, drawings, reports, analyses, writings, designs, mask
works and other works of authorship and copyrightable subject matter and
all registrations thereof, applications therefor, and renewals,
extensions and reversions thereof (including moral and economic rights,
however denominated);
“Court Hearing” means the hearing by the High Court of the
Petition to sanction the Scheme under Section 453 of the Act;
“Court Order” means the order or orders of the High Court
sanctioning the Scheme under Section 453 of the Act and confirming the
related reduction of capital that forms part of it under Sections 84 and
85 of the Act;
“Data Privacy Rules” has the meaning given to that term in
Clause 6.16.1(m)(xi);
“Disabling Code” has the meaning given to that term in
Clause 6.16.1(m)(ix);
“Effective Date” means (i) the date on which the Scheme becomes
effective in accordance with its terms or (ii) if the Acquisition is
implemented by way of a Takeover Offer, the Takeover Offer having become
(or having been declared) unconditional in all respects in accordance
with the provisions of the Takeover Offer Documents and the requirements
of the Takeover Rules;
“Effective Time” means the time on the Effective Date at which
the Court Order and a copy of the minute required by Section 86 of the
Act are registered by the Registrar of Companies or, as the case may be,
the Takeover Offer becomes (or is declared) unconditional in all
respects;
“EGM” means the extraordinary general meeting of Target
Shareholders (and any adjournment thereof) to be convened in connection
with the Scheme, expected to be convened as soon as the Scheme Meeting
shall have been concluded (it being understood that if the Scheme
Meeting is adjourned, the EGM shall be correspondingly adjourned);
“EGM Resolutions” means the resolutions to be proposed at the EGM
for the purposes of approving and implementing the Scheme, the related
reduction of capital of Target, changes to the Articles of Association,
including as contemplated by Clause 4.3, and such other matters as
Target reasonably determines to be necessary for the purposes of
implementing the Acquisition or, subject to the consent of Zoetis (such
consent not to be unreasonably withheld or delayed), desirable for the
purposes of implementing the Scheme or the Acquisition;
“EMA” means the European Medicines Agency;
“Encumbrance” means any mortgage, charge, pledge, lien, option,
restriction, assignment, hypothecation, right of first refusal, or
offer, right of pre-emption, or right to acquire or restrict, any
adverse claim or right or third party right or interest, any other
encumbrance or security interest of any kind, and any other type of
preferential arrangement (including, without limitation, title transfer
and retention arrangements or pre-emption rights) having a similar
effect;
“End Date” means the date that is: (i) six months after the date
hereof; or (ii) nine months after the date hereof where the directions
hearing of the High Court (following the approval of the Scheme
Resolution) to set a date for the Court Hearing and other related
matters (such as advertising requirements) has not been held and
concluded by Monday, July 30, 2017 at the latest, or, in either case,
such later date as Zoetis and Target may, with (if required) the consent
of the Panel, agree and (if required) the High Court may allow;
“ERISA” means the United States Employee Retirement Income
Security Act of 1974, as amended;
“Euro Deferred Shares” means the 400 deferred shares with a
nominal value of €100 each in the share capital of Target;
“Exchange Act” means the United States Securities Exchange Act of
1934, as amended;
“Executive Officers” means the executive officers of
Target listed in Clause 1.1 of the Target Disclosure Letter;
“Existing Policies” has the meaning given to that term in
Clause 7.2(c);
“Expenses Reimbursement Agreement” means the expenses
reimbursement agreement dated the date hereof between Zoetis and Target,
the terms of which have been approved by the Panel;
“FDA” means the United States Food and Drug Administration;
“FDA Ethics Policy” has the meaning given to that term in
Clause 6.1(p)(viii);
“Final Recommendation Change Notice” has the meaning given to
that term in Clause 5.2(e);
“Governmental Authorisation” means any Clearance made available
by or under the authority of any Governmental Body or pursuant to any
applicable Law (including any of the foregoing that relate to export
control);
“Governmental Body” means any Irish, United States, foreign or
supranational, federal, state, local or other governmental or regulatory
authority, agency in any jurisdiction, commission, board, body, bureau,
arbitrator, arbitration panel, or other authority, agency, including
courts and other judicial bodies, or any competition, antitrust, foreign
investment review or supervisory body, central bank or other
governmental, trade or regulatory agency or body, securities exchange
(including NASDAQ and NYSE) or any self-regulatory body or authority,
including any instrumentality or entity designed to act for or on behalf
of the foregoing, in each case, in any jurisdiction (provided it has
jurisdiction over the applicable Person or its activities or property),
including the Panel, the High Court, the SEC, the FDA, the USDA, the
EMA, the Health Products Regulatory Authority (of Ireland) and the Irish
Department of Agriculture, Food and the Marine;
“High Court” means the High Court of Ireland;
“IACUC” has the meaning given to that term in Clause 6.1(p)(i);
“Indebtedness” means any and all (i) indebtedness for borrowed
money, whether current or funded, secured or unsecured, including that
evidenced by notes, bonds, debentures or other similar instruments (and
including all outstanding principal, prepayment premiums, if any, and
accrued interest, fees and expenses related thereto), (ii) amounts owed
with respect to drawn letters of credit, (iii) cash overdrafts, and
(iv) outstanding guarantees of obligations of the type described in
clauses (i) through (iii) above;
“Indemnified Parties” and “Indemnified Party” have the
meaning given to those terms in Clause 7.2(a);
“Industrial Instrument” means any award, modern award, collective
agreement, enterprise agreement, transitional instrument or any other
form of agreement made or taken to exist under any industrial law
including, without limitation, the Fair Work (Transitional Provisions
and Consequential Amendments) Act 2009 (Cth) of Australia and the Fair
Work Act 2009 (Cth) of Australia, as amended from time to time;
“Infringement” has the meaning given to that term in
Clause 6.16.1(m)(iv) and “Infringe” shall be construed
accordingly;
“Intellectual Property” means all intellectual property rights of
any kind in any jurisdiction throughout the world, whether registered or
unregistered, including all rights, title and interests in, to and
concerning: (a) Patents; (b) Marks; (c) Copyrights; (d) Software, data,
databases and compilations of information; (e) all confidential and
proprietary information, including Trade Secrets, know-how and technical
information, including unpatented and unpatentable inventions, ideas,
discoveries, research and development results and plans, improvements,
formulae, flow charts, algorithms, routines, compositions, formulations,
patterns, schematics, designs, drawings, specifications, plans,
compilations, programs, devices, methods, processes, techniques,
technical and non-technical data, manuals, reports, customer and
supplier lists and information, pricing and cost information, business
and marketing research and forecasts, proposals, and personnel
information; (f) all websites and internet domain names and
registrations and renewals thereof; (g) all advertising and promotional
materials and product labels; (h) all social media accounts and content
found therein; (i) all other intellectual property and other proprietary
rights; and (j) all copies and tangible embodiments of the foregoing (in
whatever form or medium), and (k) all rights to sue for and all remedies
resulting from, past, present and future Infringement of the forgoing;
“IP Agreements” has the meaning given to that term in
Clause 6.16.1(m)(iii);
“IPO Options” means options to purchase Target Shares at an
exercise price per share equal to the greater of US$15.00 or the price
per share of the Target Shares at the Target’s initial public offering
and granted pursuant to the Target 2015 Plan;
“Ireland” means the island of Ireland, excluding Northern Ireland
(the counties of Antrim, Armagh, Derry, Down, Fermanagh and Tyrone), and
the word “Irish” shall be construed accordingly;
“Knowledge” means the actual knowledge, after all reasonable due
enquiry, of and by the Executive Officers;
“Law” means any applicable federal, state, local, municipal,
foreign, supranational or other law, statute, constitution, principle of
common law, resolution, ordinance, code, agency requirement, licence,
permit, edict, binding directive, decree, rule, regulation, judgment,
order, injunction, ruling or requirement issued, enacted, adopted,
promulgated, implemented or otherwise put into effect by or under the
authority of any Governmental Body;
“Leased Real Property” has the meaning given to that term in
Clause 6.1(q)(ii);
“Material Contract” has the meaning given to that term in
Clause 6.1(j)(i);
“Marks” means all trademarks, service marks, trade dress, logos,
trade names, corporate names, business names, brand names, domain names,
design rights, and other source identifiers, including the goodwill of
the business associated with the foregoing, and all registrations and
applications for registration of the foregoing and extensions, and
renewals thereof;
“Maximum Premium” has the meaning given to that term in
Clause 7.2(c);
“Moral Rights” has the meaning given to that term in Part IX of
the Copyright Act 1968 (Cwth) of Australia and includes
corresponding rights in jurisdictions outside Australia;
“Most Recent Balance Sheet” means the unaudited consolidated
balance sheet of Target as of February 28, 2017 provided to Zoetis prior
to the date hereof;
“NASDAQ” means the NASDAQ Stock Market;
“New Plans” has the meaning given to that term in Clause 7.3(b);
“Notice Period” has the meaning given to that term in
Clause 5.2(e);
“NYSE” means the New York Stock Exchange;
“Old Plans” means each Target Benefit Plan in which a Target
Employee participated immediately prior to the Effective Date;
“Open Source Software” means any Software that contains, or is
derived in any manner (in whole or in part) from, any Software that is
distributed as free Software, open source Software or similar licensing
or distribution models, including Software licensed or distributed under
any of the licences or distribution models identified by the Open Source
Initiative at http://www.opensource.org/licences/alphabetical,
or any similar licence or distribution model;
“Orders” has the meaning given to that term in Clause 6.1(f);
“Organisational Documents” means constitution, articles of
association, articles of incorporation, certificate of incorporation or
bylaws or other equivalent organisational document, as appropriate;
“Owned Real Property” has the meaning given to that term in
Clause 6.1(q)(i);
“Panel” means the Irish Takeover Panel;
“Parties” means Target, Zoetis and Zoetis Bidco, and “Party”
shall mean either Target, Zoetis or Zoetis Bidco (as the context
requires);
“Patents” means any and all US and foreign patent rights,
including all: (i) patents (including utility, utility model, plant and
design patents, and certificates of invention); (ii) patent
applications, including all provisional applications, substitutions,
continuations, continuations-in-part, divisions, renewals and all
patents granted thereon; (iii) patents-of-addition, reissues,
re-examinations, confirmations, re-registrations, invalidations, and
extensions or restorations by existing or future extension or
restoration mechanisms, including supplementary protection certificates
or the equivalent thereof; and (iv) foreign counterparts of any of the
foregoing;
“Paychex Agreement” has the meaning given to that term in Clause
6.1(n)(ii);
“Paychex Plan” has the meaning given to that term in the
definition of Target Benefit Plan;
“Permitted Encumbrances” means any Encumbrance:
(a) for Taxes or governmental assessments, charges or claims of payment
not yet due and payable, being contested in good faith or which may
hereafter be paid without penalty or for which adequate accruals or
reserves have been established in accordance with US GAAP (where
required);
(b) which is disclosed on the Most Recent Balance Sheet of Target or
notes thereto or securing liabilities reflected on such balance sheet;
(c) which was incurred in the ordinary course of business consistent
with past practice since the date of the Most Recent Balance Sheet of
Target; or
(d) which would not, individually or in the aggregate, reasonably be
expected to materially impair the value of or the continued use of the
applicable property for the purposes for which the property is currently
being used;
“Person” or “person” means an individual, group (including
a “group” under Section 13(d) of the Exchange Act), corporation,
partnership, limited liability company, joint venture, association,
trust, unincorporated organisation or other entity or any Governmental
Body or any department, agency or political subdivision thereof;
“Petition” means the petition to the High Court seeking the Court
Order;
“Preferred Shares” means the 10,000,000 undesignated preferred
shares with a nominal value of US$0.01 each in the share capital of
Target;
“Proxy Statement” has the meaning given to that term in
Clause 3.1;
“Recall” has the meaning given to that term in Clause 6.1(p)(iii);
“Registrar of Companies” means the Registrar of Companies in
Dublin, Ireland as defined in Section 2 of the Act;
“Regulation S-K” means Regulation S-K promulgated under the
Securities Act;
“Regulatory Information Service” means a regulatory information
service as defined in the Takeover Rules;
“Representatives” means in relation to any person, the directors,
officers, employees, agents (excluding any brand licensing agents),
investment bankers, financial advisers, legal advisers, accountants,
brokers, finders, consultants or representatives of such person;
“Resolutions” means collectively, the Scheme Meeting Resolution
and the EGM Resolutions, which will be set out in the Scheme Document;
“Rule 2.5 Announcement” means the announcement to be made by
the Parties pursuant to Rule 2.5 of the Takeover Rules, a copy of which
is annexed to this Agreement at Schedule 3;
“Rule 15 Consideration” has the meaning given to that term in
Clause 4.1(b);
“Rule 15 Proposals” means the proposals to be made to the
holders of the Target Convertible Securities in accordance with Clause
4.1 of this Agreement for the purpose of complying with Rule 15 of the
Takeover Rules;
“Sanction Date” means the date of sanction of the Scheme pursuant
to Sections 449 to 455 of the Act and confirmation of the related
reduction of capital involved therein by the High Court;
“Sarbanes-Oxley Act” has the meaning given to that term in
Clause 6.1(k)(v);
“Scheme” means the proposed scheme of arrangement under Chapter 1
of Part 9 of the Act and the related capital reduction under Sections 84
and 85 of the Act to effect the Acquisition pursuant to this Agreement,
on the terms (including the Conditions) and for the consideration set
out in the Rule 2.5 Announcement and on such other terms and in such
form not being inconsistent therewith as the Parties mutually agree in
writing, including any revision thereof as may be so agreed between the
Parties and, if required, by the High Court;
“Scheme Document” means a document (or relevant sections of the
Proxy Statement comprising the scheme document), including any
amendments or supplements thereto, to be distributed as part of the
Proxy Statement to Target Shareholders and, for information only, to
holders of the Target Convertible Securities, containing:
(a) the Scheme;
(b) the notice or notices of the Scheme Meeting and the EGM;
(c) an explanatory statement as required by Section 452 of the Act with
respect to the Scheme;
(d) such other information as may be necessary or appropriate pursuant
to the Act, the Exchange Act or the Takeover Rules; and
(e) such other information as Target and Zoetis shall agree, each acting
reasonably;
“Scheme Meeting” means the meeting or meetings of the
Target Shareholders or, if applicable, any class or classes of Target
Shareholders (including, but not limited to, as may be directed by the
High Court pursuant to Section 450(5) of the Act) (and any adjournment
of any such meeting or meetings) convened by (i) resolution of the
Target Board or (ii) order of the High Court, in either case pursuant to
Section 450 of the Act, to consider and vote on the Scheme Meeting
Resolution;
“Scheme Meeting Resolution” means the resolution to be considered
and voted on at the Scheme Meeting proposing that the Scheme, with or
without amendment (but subject to such amendment being acceptable to
each of Target and Zoetis, except for a technical or procedural
amendment which is required for the proper implementation of the Scheme
and does not have a substantive consequence on the implementation of the
Scheme), be agreed to;
“Scheme Recommendation” means the unanimous recommendation of the
Target Board that Target Shareholders vote in favour of the Resolutions;
“SEC” means the United States Securities and Exchange Commission;
“Securities Act” means the United States Securities Act of
1933, as amended;
“Software” means all computer software, programs and code,
including assemblers, applets, compilers, source code, object code,
executable code, net lists, development tools, design tools, user
interfaces and data, databases in any form or format, however fixed, and
all related documentation;
“Study” has the meaning given to that term in Clause 6.1(p)(i);
“Study Materials” has the meaning given to that term in
Clause 6.1(p)(v);
“Subsidiary” means in relation to any person, any corporation,
partnership, association, trust or other form of legal entity of which
such person directly or indirectly owns securities or other equity
interests representing more than 50% of the aggregate voting power;
“Superior Proposal Notice” has the meaning given to that term in
Clause 5.2(e);
“Takeover Offer” means an offer in accordance with Clause 3.7 for
the entire issued and to be issued ordinary share capital of Target
(other than any Target Shares beneficially owned by any member of Zoetis
Group (if any)), including any amendment or revision thereto pursuant to
this Agreement, the full terms of which would be set out in the Takeover
Offer Documents or (as the case may be) any revised offer document(s);
“Takeover Offer Documents” means if following the date hereof,
Zoetis elects to implement the Acquisition by way of Takeover Offer in
accordance with Clause 3.7, the documents to be despatched to Target
Shareholders and others by Zoetis Bidco containing, amongst other
things, the Takeover Offer, the Conditions (save insofar as not
appropriate in the case of a Takeover Offer, and as amended in such
manner as Zoetis and Target shall determine, and the Panel shall agree,
to be necessary to reflect the terms of the Takeover Offer) and certain
information about Zoetis, Zoetis Bidco and Target and, where the context
so admits, includes any form of acceptance, election, notice or other
document reasonably required in connection with the Takeover Offer;
“Takeover Panel Act” means the Irish Takeover Panel Act 1997, as
amended;
“Takeover Rules” means the Irish Takeover Panel Act 1997,
Takeover Rules, 2013;
“Target” has the meaning given to that term in the introduction
of this Agreement;
“Target 2012 Plan” means the Nexvet Employee Share Plan governed
by the Employee Share Plan dated August 29, 2012 adopted by the board of
directors of Nexvet Biopharma Pty Limited on August 29, 2012;
“Target 2013 Australian Plan” means the Nexvet Long Term
Incentive Plan governed by the Long Term Incentive Plan Rules dated
November 5, 2013 and adopted by board of directors of Nexvet Biopharma
Pty Limited on October 30, 2013;
“Target 2013 Plan” means the Nexvet Long Term Incentive Plan
governed by the Long Term Incentive Plan Rules dated September 4, 2014
and adopted by the Target Board on September 18, 2014;
“Target 2015 Plan” means the Nexvet Biopharma Public Limited
Company 2015 Equity Incentive Plan as adopted by the Target Board on
October 14, 2014, as amended by the Target Board on January 16, 2015 and
as further amended by the Compensation Committee (as defined therein) on
September 2, 2015;
“Target 401(k) Plans” has the meaning given to that term in
Clause 7.3(f);
“Target Alternative Proposal” means any bona fide proposal or
bona fide offer, which proposal or offer may be subject to due
diligence, definitive documentation or both, made by any person (other
than a proposal or offer pursuant to Rule 2.5 of the Takeover Rules by
Zoetis or any of its Concert Parties) for:
(a) a merger, reorganisation, share exchange, consolidation, business
combination, recapitalisation, dissolution, liquidation or similar
transaction involving Target that, if consummated, would result in any
Person beneficially owning shares with more than 20% of the voting power
of Target;
(b) the direct or indirect acquisition by any Person of more than 20% of
the value of the assets of the Target Group, taken as a whole; or
(c) the direct or indirect acquisition by any Person of more than 20% of
the voting power or the issued share capital of Target, including any
offer or exchange offer that if consummated would result in any Person
beneficially owning shares with more than 20% of the voting power of
Target;
“Target Associate” means any current employee, independent
contractor, consultant or director of or to any member of the Target
Group;
“Target Benefit Plans” means any Benefit Plan (i) to which Target
or any of its Subsidiaries is a party, (ii) sponsored, maintained or
contributed to, or required to be maintained or contributed to by Target
or any of its Subsidiaries or (iii) with respect to which Target or any
of its Subsidiaries has or could reasonably be expected to have any
obligation or liability; for the avoidance of doubt, any Benefit Plan
sponsored or maintained by Paychex, pursuant to the Paychex Agreement,
in which any current or former employee of the Target Group or such
employee’s dependents or beneficiaries participates (such a Benefit
Plan, a “Paychex Plan”) shall be a Target Benefit Plan;
“Target Board” means the board of directors of Target from time
to time and for the time being;
“Target Change of Recommendation” has the meaning given to that
term in Clause 5.2(d)(ii);
“Target Convertible Securities” means all issued
and outstanding securities (including, but not limited to, all options,
restricted share units, warrants and/or other convertible securities
issued pursuant the Target Plans) which are convertible, exchangeable or
exercisable into Target Shares;
“Target Disclosure Letter” means the disclosure letter delivered
by Target to Zoetis on the date hereof;
“Target Employee” means an employee of any member of the Target
Group who remains employed after the Effective Time;
“Target Group” means Target and all of its Subsidiaries;
“Target Intellectual Property” has the meaning given to that term
in Clause 6.1(m)(i);
“Target Options” means options to purchase Target Shares granted
pursuant to the Buyback Options, the Target 2013 Plan or the Target 2015
Plan;
“Target Plans” means the Target 2012 Plan, the Buyback Options,
the Target 2013 Australian Plan, the Target 2013 Plan and the Target
2015 Plan;
“Target Products” means any product or service made, marketed,
sold, licensed or in development by any member of the Target Group;
“Target RSUs” means restricted share units granted pursuant to
the Target 2013 Plan or the Target 2015 Plan;
“Target SEC Documents” means all forms, documents and reports
(including exhibits and other information incorporated therein) filed or
furnished by Target with the SEC;
“Target Shares” means the existing unconditionally allotted or
issued and fully paid ordinary shares with a nominal value of US$ 0.125
each in the capital of Target and any further such shares which are
unconditionally allotted or issued before the date on which the Scheme
is effective;
“Target Shareholders” means the holders of the Target
Shares;
“Target Shareholder Approval” means:
(a) the approval of the Scheme Meeting Resolution by a majority in
number of Target Shareholders representing at least 75% or more in value
of Target Shares held by such Target Shareholders, present and voting
either in person or by proxy, at the requisite Scheme Meeting (or at any
adjournment of such meeting); and
(b) the EGM Resolutions being duly passed by the requisite majorities of
Target Shareholders present and voting either in person or by proxy at
the EGM (or at any adjournment of such meeting);
“Target Superior Proposal” means a written bona fide Target
Alternative Proposal (where each reference to 20% set forth in the
definition of such term shall be deemed to refer to 50%, but provided
that such Target Alternative Proposal may not be subject to due
diligence or definitive documentation (other than the execution
thereof)) that the Target Board determines in good faith (after
consultation with Target’s financial advisers and outside legal counsel)
is more favourable to the Target Shareholders than the Transactions,
taking into account such financial, regulatory, legal, structuring,
timing and other aspects of such proposal as the Target Board considers
to be appropriate;
“Tax” (or “Taxes” and, with correlative meaning, the term “Taxable”)
means all national, federal, state, local or other taxes imposed by the
United States, Ireland, and any other Governmental Body or Tax
Authority, including income, gain, profits, windfall profits, franchise,
gross receipts, environmental, customs duty, capital stock, severances,
stamp, payroll, universal social charge, pay related social insurance
and other similar contributions, sales, employment, unemployment,
disability, use, property, gift tax, inheritance tax, unclaimed
property, escheat, withholding, excise, production, value added, goods
and services, trading, occupancy and other taxes, duties or assessments
of any nature whatsoever, or state aid related thereto, together with
all interest, penalties, surcharges and additions imposed with respect
to such amounts and any interest in respect of such penalties and
additions, whether disputed or not, and any liability in respect of any
of the foregoing items payable by reason of contract, assumption,
transferee or successor liability;
“Tax Authority” means any Governmental Body responsible
for the assessment, collection or enforcement of laws relating to Taxes
or for making any decision or ruling on any matter relating to Tax
(including the US Internal Revenue Service and the Irish Revenue
Commissioners);
“Tax Return” means any return (including any information
return), report, statement, declaration, estimate, schedule, or
information, including any amendments thereof, filed with, or required
to be filed with, any Tax Authority in connection with the
determination, assessment, collection or payment of any Tax or in
connection with the administration, implementation or enforcement of or
compliance with any Law relating to any Tax;
“Trade Secrets” mean any information in all forms and types of
financial, business, scientific, technical, economic, or engineering
information, including patterns, plans, compilations, program, devices,
formulas, designs, prototypes, methods, techniques, processes,
procedures, programs, algorithm used in research, developments,
products, design, and the use thereof, or codes, whether tangible or
intangible, and whether or how stored, compiled, or memorialised
physically, electronically, graphically, photographically, or in
writing, that derives its value in part because it is not generally
known by others and that is the subject of reasonable efforts to
maintain its secrecy;
“Transactions” means the transactions contemplated by this
Agreement, including the Acquisition;
“UK” means the United Kingdom of Great Britain and Northern
Ireland;
“US$”, “$” or “USD” means United States dollars,
the lawful currency of the United States of America;
“US” or “United States” means the United States, its
territories and possessions, any State of the United States and the
District of Columbia, and all other areas subject to its jurisdiction;
“USDA” means the United States Department of Agriculture;
“US GAAP” means US generally accepted accounting principles;
“WARN Act” means collectively, the United States Worker
Adjustment and Retraining Notification Act and its regulations and any
other similar Laws;
“Warrants” means all warrants which are currently in issue and
which give, or potentially give, the right to any person to subscribe
for (or otherwise acquire or call for delivery of) Target Shares and
which were issued pursuant to the Target Warrant terms of issue
(specifying an exercise price of US$8.625), the first Target Warrant
terms of issue (specifying an exercise price of US$7.50) or the second
Target Warrant terms of issue (specifying an exercise price of US$7.50),
in each case, as amended by the First Amendment to Warrant Terms of
Issue dated September 3, 2015, where applicable;
“Zoetis” has the meaning given to that term in the introduction
of this Agreement;
“Zoetis Board” means the board of directors of Zoetis;
“Zoetis Confidentiality Agreement” means the confidentiality
agreement between Target and Zoetis dated February 22, 2017 and as it
may be further amended in writing by Zoetis and Target from time to time;
“Zoetis Group” means collectively, Zoetis and all of its
Subsidiaries, including Zoetis Bidco; and
“€” means the lawful currency of Ireland.
1.2 Construction
(a) In this Agreement, words such as “hereunder”, “hereto”,
“hereby”, “hereof” and “herein” and other words of
similar meaning when used in this Agreement shall, unless the context
clearly indicates to the contrary, refer to the whole of this Agreement
and not to any particular section or clause thereof.
(b) In this Agreement, save as otherwise provided herein, any reference
herein to a section, clause, schedule or paragraph shall be a reference
to a section, subsection, clause, sub-clause, paragraph or sub-paragraph
(as the case may be) of this Agreement.
(c) In this Agreement, any reference to any provision of any legislation
shall include any amendment, modification, re-enactment or extension
thereof and shall also include any subordinate legislation made from
time to time under such provision, and any reference to any provision of
any legislation, unless the context clearly indicates to the contrary,
shall be a reference to legislation of Ireland.
(d) In this Agreement, the masculine gender shall include the feminine
and neuter and the singular number shall include the plural and vice
versa.
(e) In this Agreement, the term “officers” shall be construed to mean
corporate officers and executive officers.
(f) In this Agreement, any phrase introduced by the terms “including”,
“include”, “in particular” or any similar expression shall be construed
as illustrative and shall not limit the sense of the words preceding
those terms.
(g) In this Agreement, any agreement or instrument defined or referred
to herein or in any agreement or instrument that is referred to herein
means such agreement or instrument as from time to time amended,
modified or supplemented, including by waiver or consent, and all
attachments thereto and instruments incorporated therein.
(h) In this Agreement, the phrase “all reasonable endeavours” and words
of similar import shall not be construed to mean that a Party must take,
or procure the taking of, any action that would be commercially
unreasonable under the circumstances.
1.3 Captions
The table of contents and the headings or captions to the clauses in
this Agreement are inserted for convenience of reference only and shall
not affect the interpretation or construction thereof.
1.4 Time
References to times are to US Eastern times unless otherwise specified.
2. Rule 2.5 Announcement and Scheme Document
2.1 Rule 2.5 Announcement
(a) Each Party confirms that its respective board of directors (or a
duly authorised committee or management team acting under the authority
thereof) has approved the contents and release of the Rule 2.5
Announcement.
(b) On the execution of this Agreement, the Parties shall, in accordance
with, and for the purposes of, the Takeover Rules, procure the release
of the Rule 2.5 Announcement to a Regulatory Information Service by no
earlier than 5:00 a.m. and no later than 5:00 p.m. on April 13, 2017, or
such later time on that date as may be agreed between the Parties in
writing.
(c) The obligations of the Parties under this Agreement, other than the
obligations under Clause 2.1(b), shall be conditional on the release of
the Rule 2.5 Announcement to a Regulatory Information Service in
accordance with clause 2.1(b).
(d) Target confirms that, as of the date hereof, the Target Board
unanimously considers that the terms of the Scheme as contemplated by
this Agreement are fair and reasonable to the Target Shareholders and
that the Target Board has unanimously resolved to recommend to the
Target Shareholders that they vote in favour of the Resolutions. The
unanimous recommendation of the Target Board that the Target
Shareholders vote in favour of the Resolutions, and the related opinion
of the financial advisers to the Target Board, are set out in the
Rule 2.5 Announcement and, subject to Clause 5.2, shall be incorporated
in the Scheme Document and the Proxy Statement, and, to the extent
required by the Takeover Rules, in any other document sent to Target
Shareholders in connection with the Acquisition.
(e) The Conditions are hereby incorporated in, and shall constitute a
part of, this Agreement.
2.2 Scheme
(a) Target agrees that it shall put the Scheme to the Target
Shareholders in the manner set out in Clause 3 and, subject to the
satisfaction or waiver (where permissible pursuant to the provisions of
the Rule 2.5 Announcement and/or the Scheme Document) of the Conditions
(with the exception of Conditions 2(c) and 2(d) and any other Conditions
that by their nature are to be satisfied on the Sanction Date, but
subject to the satisfaction or waiver (where permissible pursuant to the
provisions of the Rule 2.5 Announcement and/or the Scheme Document) of
such Conditions), shall, in the manner set out in Clause 3, petition the
High Court to sanction the Scheme so as to facilitate the implementation
of the Acquisition.
(b) Each of the Zoetis Parties agrees, subject to Clause 3.6, that it
shall participate in the Scheme and agrees to be bound by its terms and
that it shall, subject to the satisfaction or waiver (where permissible
pursuant to the provisions of the Rule 2.5 Announcement and/or the
Scheme Document) of the Conditions, effect the Acquisition through the
Scheme on the terms set out in this Agreement and the Scheme.
(c) Each of the Parties agrees that it shall fully and promptly perform
all of the obligations required of it in respect of the Acquisition on
the terms set out in this Agreement and/or the Scheme and each shall,
subject to the terms and conditions of this Agreement, use all
reasonable endeavours (including by causing its controlled Concert
Parties to, and using all reasonable endeavours to cause its
Representatives and non-controlled Concert Parties) to act in a manner
consistent with the terms of this Agreement pertinent to such Party and
take such other steps as are reasonably required for the proper
implementation of the Scheme and in connection with Completion.
3. Implementation of the Scheme
3.1 Preparation of Proxy Statement
As soon as reasonably practicable, but in any event within 28 days
following the date hereof, Target shall, with the assistance and
approval (not to be unreasonably withheld or delayed) of Zoetis prepare
and file with the SEC a proxy statement, which shall include the Scheme
Document (as may be amended or supplemented, the “Proxy Statement”),
relating to the matters to be submitted to the Target Shareholders at
the Scheme Meeting and the EGM. Target shall use all reasonable
endeavours to resolve all SEC comments and have the Proxy Statement
cleared by the SEC as promptly as is reasonably practicable following
filing with the SEC and to mail the Proxy Statement to its shareholders
as promptly as is reasonably practicable after such clearance, to the
extent required by applicable Law. Target shall, as promptly as is
reasonably practicable after receipt thereof, provide Zoetis with copies
of any written comments and advise Zoetis of any oral comments with
respect to the Proxy Statement received from the SEC. Each Party shall
cooperate and Target shall provide Zoetis with a reasonable opportunity
(which shall not be less than two Business Days from receipt of written
notice from Target) to review and comment on any amendment or supplement
to the Proxy Statement prior to filing such with the SEC, which comments
shall be reasonably considered by Target, and Target will provide Zoetis
with a copy of all such filings made with the SEC (to the extent not
otherwise made publicly available). Target will advise Zoetis, promptly
after it receives notice thereof, of SEC clearance of the Proxy
Statement. If, at any time prior to the Effective Time, an amendment or
supplement to the Proxy Statement is necessary so that such documents
would not include any misstatement of a material fact or omit to state
any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, Target
shall promptly notify Zoetis and, to the extent required by Law an
appropriate amendment or supplement describing such information shall be
promptly filed with the SEC and, to the extent required by Law,
disseminated to the Target Shareholders. To the extent that clearance of
the Proxy Statement by the SEC might require that waivers and/or
derogations in respect of the Takeover Rules be sought and obtained from
the Panel, following discussion with Zoetis, Target shall make a
submission for such waiver or derogation at the earliest opportunity
after having provided Zoetis with a reasonable opportunity to review and
comment on such submission, which comments shall be reasonably
considered and accommodated by Target.
3.2 Responsibilities of Target in respect of the Scheme
Target shall:
(a) be responsible for the preparation of the Scheme Document (subject
to Clause 3.3(f)) and all other documentation necessary to effect the
Scheme and to convene the Scheme Meeting and the EGM and Target shall
provide Zoetis with drafts of the Scheme Document and such other
documents and afford Zoetis reasonable opportunities (which shall not be
less than two Business Days from receipt of written notice from Target)
to review and make comments on the Scheme Document and such other
documents and shall give due consideration to and where reasonable
accommodate such comments and subject to the foregoing provisions,
unless otherwise agreed by the Panel, Target shall cause the Scheme
Document to be delivered to the Panel at least ten Business Days before
the Scheme Documents are considered by the High Court in accordance with
Rule 41.1(b) of the Takeover Rules;
(b) for the purpose of implementing the Scheme, instruct a barrister (of
senior counsel standing, the identity of whom shall be reasonably
acceptable to Zoetis) and provide Zoetis and its advisers with the
opportunity to attend any meetings with such barrister to discuss
substantive matters pertaining to the Scheme and any issues arising in
connection with it (except to the extent that the barrister is to advise
on matters relating to the fiduciary duties of the directors of Target
or their responsibilities under the Takeover Rules);
(c) as promptly as is reasonably practicable after the Proxy Statement
is filed with the SEC, or, if the Proxy Statement is reviewed and
commented upon by the SEC, after the filing of the first amendment to
the preliminary Proxy Statement with the SEC, Target shall cause the
Proxy Statement to be delivered to the Panel;
(d) notify Zoetis as promptly as is reasonably practicable in writing
upon the receipt of any comments from the Panel on, or any request from
the Panel for amendments or supplements to, the Scheme Document and the
related forms of proxy to be so filed or furnished;
(e) prior to filing or despatch of any amendment or supplement to the
Scheme Document requested by the Panel, or responding in writing to any
comments of the Panel with respect thereto, Target shall:
(i) as promptly as is reasonably practicable provide Zoetis with a
reasonable opportunity to review and comment on such document or
response; and
(ii) as promptly as is reasonably practicable discuss with Zoetis and
include in such document or response all comments reasonably proposed by
Zoetis as promptly as is reasonably practicable to the extent that such
comments are required in order to ensure that such document is
consistent with the Rule 2.5 Announcement;
(f) provide Zoetis with drafts of pleadings, affidavits, petitions and
other filings prepared by Target for submission to the High Court in
connection with the Scheme prior to their filing or submission, and
afford Zoetis reasonable opportunities to review and make comments on
all such documents, and shall give due consideration to and where
reasonable accommodate such comments prior to any such filing or
submission;
(g) as promptly as is reasonably practicable (taking into account any
requirements of the Panel with respect to the Scheme Document and the
clearance process of the SEC with respect to the Proxy Statement, that
must be satisfied prior to the release of the Scheme Document) make all
necessary applications to the High Court in connection with the
implementation of the Scheme where so resolved by the Target Board or
required to implement the Scheme and in particular Target will promptly
after the date of the Rule 2.5 Announcement issue appropriate
proceedings requesting the High Court to give directions under
Section 450(5) of the Act as to what are the appropriate Scheme Meetings
to be held and to order that the Scheme Meeting be convened as promptly
as is reasonably practicable following the publication of the Rule 2.5
Announcement and clearance of the Proxy Statement by the SEC, and use
all reasonable endeavours so as to ensure that the hearing of such
proceedings occurs as promptly as is reasonably practicable in order to
facilitate the despatch of the Scheme Document as promptly as is
reasonably practicable after such hearing and seek such directions of
the High Court as it (or Zoetis) considers necessary or desirable to
facilitate the convening of such Scheme Meeting and thereafter comply
with such directions;
(h) procure the publication of the requisite advertisements and posting
of the Scheme Document (in a form acceptable to the Panel) and the forms
of proxy for the use at the Scheme Meeting and the EGM (the forms of
which shall be agreed between the Parties) to Target Shareholders on the
register of members of Target (and, for information purposes only, the
holders of Target Convertible Securities) on the record date as agreed
with the High Court, as promptly as is reasonably practicable after the
approval of the High Court to despatch the documents being obtained and
thereafter shall publish and/or post such other documents and
information (the form of which shall be agreed between the Parties) as
the High Court and/or the Panel may approve or direct from time to time
in connection with the implementation of the Scheme in accordance with
applicable Law as promptly as is reasonably practicable after the
approval or (as the case may be) direction of the High Court and/or the
Panel to publish or post such documents being obtained;
(i) unless the Target Board has effected a Target Change of
Recommendation pursuant to Clause 5.2, procure that the Scheme Document
and the Proxy Statement shall include the Scheme Recommendation;
(j) include in the Scheme Document a notice convening the EGM to be held
immediately following the Scheme Meeting to consider and, if thought
fit, approve the EGM Resolutions;
(k) keep Zoetis informed on a daily basis, from the date falling 14 days
before the Scheme Meeting and the EGM, of the number of proxy votes
received in respect of the Resolutions;
(l) keep Zoetis reasonably informed and, as reasonably requested by
Zoetis, consult with Zoetis, as to the performance of the obligations
and responsibilities required of Target pursuant to this Agreement
and/or the Scheme and as to any material developments (other than as to
a Target Alternative Proposal, the timing and scope of provision of
information about which are governed by Clause 5.2) relevant to the
proper implementation of the Scheme, including the satisfaction of the
Conditions;
(m) notwithstanding any Target Change of Recommendation, unless this
Agreement has been terminated pursuant to Clause 9, hold the Scheme
Meeting and the EGM on the date set out in the Scheme Document, or such
later date as may be agreed in writing between the Parties (such
agreements not to be unreasonably withheld, conditioned or delayed), and
in such a manner as shall be approved, if necessary, by the High Court
and/or the Panel and propose the Resolutions without any amendments,
unless such amendments have been agreed to in writing with Zoetis, such
agreement not to be unreasonably withheld, conditioned or delayed;
(n) afford all such cooperation and assistance as may reasonably be
requested of it by Zoetis in respect of the preparation and verification
of any document or in connection with any Clearance or confirmation
reasonably required for the implementation of the Scheme, including the
provision to Zoetis of such information and confirmation relating to it,
its Subsidiaries and any of its or their respective directors or
employees as Zoetis may reasonably request (and shall do so in a
reasonably timely manner) and assume responsibility only for the
information relating to it contained in the Scheme Document, the Proxy
Statement or any other document sent to Target Shareholders or filed
with the High Court or in any announcement;
(o) review and provide comments (if any) in a reasonably timely manner
on all documentation submitted to it;
(p) following the Scheme Meeting and EGM, provided that the Resolutions
are duly passed (including by the requisite majorities required under
Section 453 of the Act in the case of the Scheme Meeting) and all other
Conditions are satisfied or waived (where permissible pursuant to the
provisions of the Rule 2.5 Announcement and/or the Scheme Document (with
the exception of Conditions 2(c) and 2(d) and any other Conditions that
by their nature are to be satisfied on the Sanction Date, but subject to
the satisfaction or waiver (where permissible pursuant to the provisions
of the Rule 2.5 Announcement and/or the Scheme Document) of such
Conditions), take all necessary steps on the part of Target to prepare
and issue, serve and lodge all such court documents as are required to
seek the sanction of the High Court to the Scheme as soon as possible
thereafter;
(q) take all such steps as may reasonably be required to cause any
dispositions of Target Shares (including derivative securities with
respect to Target Shares) resulting from the Scheme by each member of
the Target Board or Executive Officer subject to the reporting
requirements of Section 16(a) of the Exchange Act with respect to Target
immediately prior to the Effective Time to be exempt under Rule 16b-3
promulgated under the Exchange Act; and
(r) give such undertakings as are required by the High Court as are
reasonably necessary for the proper implementation of the Scheme.
3.3 Responsibilities of Zoetis and Zoetis Bidco in Respect of the
Scheme
Zoetis and Zoetis Bidco shall:
(a) instruct counsel to appear on its behalf at the Court Hearing and
undertake to the High Court to be bound by the terms of the Scheme
insofar as it relates to Zoetis or Zoetis Bidco;
(b) if, and to the extent that, it or any of its Concert Parties owns or
is interested in Target Shares, exercise all rights, and, insofar as
lies within its powers, procure that each of its Concert Parties shall
exercise all rights, in respect of such Target Shares so as to
implement, and otherwise support the implementation of, the Scheme,
including by voting (and, in respect of interests in Target held via
contracts for difference or other derivative instruments, insofar as
lies with its powers, procuring that instructions are given to the
holder of the underlying Target Shares to vote) in favour of the
Resolutions or, if required by Law, the High Court, the Takeover Rules
or other rules, refraining from voting, at any Scheme Meeting and/or EGM
as the case may be;
(c) procure that the other members of the Zoetis Group and, so far as
lies within its power or procurement, their Representatives, use
reasonable endeavours to take all such steps as are reasonably necessary
in order to implement the Scheme including the giving by Zoetis Bidco to
the High Court of any customary undertakings which the High Court
requires Zoetis Bidco to give to it;
(d) keep Target reasonably informed and, as reasonably requested by
Target, consult with Target, as to the performance of the obligations
and responsibilities required of Zoetis and/or Zoetis Bidco pursuant to
this Agreement and/or the Scheme and as to any material developments
relevant to the proper implementation of the Scheme, including the
satisfaction of the Conditions;
(e) afford (and shall use all reasonable endeavours to procure that its
Concert Parties shall afford) all such cooperation and assistance as may
reasonably be requested of it by Target in respect of the preparation
and verification of any document or in connection with any Clearance or
confirmation required for the implementation of the Scheme, including
the provision to Target of such information and confirmation relating to
it, its Subsidiaries and any of its or their respective directors or
employees as Target may reasonably request (and shall do so in a
reasonably timely manner) and assume responsibility only for the
information relating to it contained in the Scheme Document, the Proxy
Statement or any other document sent to Target Shareholders or filed
with the High Court or in any announcement;
(f) review and provide comments (if any) in a reasonably timely manner
on all documentation submitted to it; and
(g) provide Target, in a reasonably prompt manner, with such information
regarding the Zoetis Group that may reasonably be required for inclusion
in the Scheme Document or the Proxy Statement and provide such other
assistance as Target may reasonably require in connection with the
preparation of the Scheme Document or the Proxy Statement.
3.4 Mutual Responsibilities of the Parties
(a) If any of the Parties becomes aware of any information that,
pursuant to the Takeover Rules, the Act or the Exchange Act should be
disclosed in an amendment or supplement to the Scheme Document or the
Proxy Statement, or that is required to be included therein in order
that the information therein shall not contain an untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not false
or misleading at the time and in light of the circumstances under which
such statements are made, then the Party becoming so aware shall
promptly inform the other Party thereof and the Parties shall cooperate
with each other in submitting or filing such amendment or supplement
with the Panel, and, if required, the SEC and/or the High Court and, if
required, in mailing such amendment or supplement to the Target
Shareholders and, for information only, if required, to the holders of
Target Convertible Securities.
(b) Each Party shall take, or cause to be taken, such other steps as are
reasonably required of it for the proper implementation of the Scheme,
including those required of it pursuant to Clause 8 in connection with
Completion.
(c) Each Party shall, as promptly as is reasonably practicable, notify
the other of any matter of which it becomes aware which would reasonably
be expected to materially delay or prevent filing of the Scheme
Document, the Scheme or the Acquisition as the case may be.
3.5 Dealings with the Panel
(a) Each of the Parties shall promptly provide such assistance and
information as may reasonably be requested by the other Party for the
purposes of, or in connection with, any correspondence or discussions
with the Panel in connection with the Acquisition and/or the Scheme.
(b) Save in each case where not reasonably practicable owing to time
restraints imposed by the Panel or where prohibited by the Panel, each
of the Parties shall give the other reasonable prior notice of any
proposed meeting or material substantive discussion or correspondence
between it or its Representatives with the Panel, or amendment to be
proposed to the Scheme in connection therewith, and shall afford the
other reasonable opportunities to review and make comments and
suggestions with respect to the same and accommodate such comments and
suggestions to the extent that such Party, acting reasonably, considers
these to be appropriate, and shall keep the other reasonably informed of
all such meetings, discussions or correspondence that it or its
Representative(s) have with the Panel and not participate in any meeting
or discussion with the Panel concerning this Agreement or the
Transactions unless it consults with the other Party in advance, and,
unless prohibited by the Panel, gives such other Party the opportunity
to attend such meetings and provide advance copies of all written
submissions it intends to make to the Panel and afford the other
reasonable opportunities to review and make comments and suggestions
with respect to the same and give due consideration to and where
reasonable accommodate such comments and suggestions to the extent that
such Party, acting reasonably, considers these to be appropriate, copies
of the submissions made and copies (or, where oral, an oral or written
summary of the substance) of the Panel responses thereto, provided
always that any correspondence or other information required to be
provided under this Clause 3.5(b) may be redacted:
(i) by either party, to remove references concerning the valuation of
the business of Target;
(ii) by Zoetis, to remove references to its strategic rationale for the
Acquisition;
(iii) by Zoetis, in connection to a switch to a Takeover Offer;
(iv) as necessary to comply with legal or contractual obligations; and
(v) as necessary to address reasonable privilege or confidentiality
concerns (provided that the redacting party shall use its reasonable
endeavours to cause such information to be provided in a manner that
would not result is such privilege or confidentiality concerns).
(c) Target undertakes, if so requested by Zoetis, to issue as promptly
as is reasonably practicable its written consent to Zoetis and to the
Panel in respect of any application made by Zoetis to the Panel:
(i) seeking confirmation that there is no requirement under the Takeover
Rules to disclose Zoetis’ financing arrangements for the Acquisition and
related transactions (the “Zoetis Financing Information”) in the
Scheme Document, any supplemental document or other document sent to
Target Shareholders, the holders of Target Convertible Securities or,
alternatively, seeking a waiver of or derogation from such requirement;
(ii) to redact any commercially sensitive or confidential information
specific to the Zoetis Financing Information from any documents that
Zoetis is required to display pursuant to Rule 26(b)(xi) of the Takeover
Rules; and
(iii) requesting a derogation from the disclosure requirements of
Rule 24.3 of the Takeover Rules and seeking consent to the aggregation
of dealings for the purposes of disclosure in the Scheme Document.
(d) Target and Zoetis undertake, if so requested by the other Party, to
issue as promptly as is reasonably practicable its written consent to
the other Party and to the Panel in respect of any application made by
Target or Zoetis, as applicable, to the Panel:
(i) requesting a derogation from the timing requirement pursuant to
Rule 30.2 of the Takeover Rules in connection with the despatch of the
Scheme Document or the Takeover Offer Document to Target Shareholders
and the despatch of the Rule 15 Proposals to the holders of Target
Convertible Securities, in each case where compliance with such timing
requirement will not be possible within the 28 day period after the date
of the Rule 2.5 announcement; and
(ii) requesting consent under Rule 21.1 of the Takeover Rules to permit
the issuance of Target Shares and implementation of any associated
matters (including the grant of equity awards) in connection with the
matters contemplated by paragraph 4 of Schedule 1 and/or as set out in
Clause 3.5(d)(ii) of Part A of the Target Disclosure Letter;
(iii) requesting a derogation from the disclosure requirements of
Rule 25.3 of the Takeover Rules and seeking consent to the aggregation
of dealings for the purposes of disclosure in the Scheme Document or the
Takeover Offer Document.
(e) Notwithstanding anything to the contrary in the foregoing provisions
of this Clause 3.5, neither Target nor Zoetis shall be required to take
any action pursuant to such provisions if (i) such action is prohibited
by the Panel or (ii) such action relates to a matter involving a person
who has made a Target Alternative Proposal (or any Affiliate, or person
Acting in Concert with such a Person), or (iii) Target has provided to
Zoetis a Final Recommendation Change Notice.
(f) Nothing in this Agreement shall in any way limit the Parties’
obligations under the Takeover Rules.
3.6 No Scheme Amendment by Target
Save as required by Law, the High Court and/or the Panel, Target shall
not, in each case, after despatch of the Scheme Document without the
prior written consent of Zoetis:
(a) amend the Scheme;
(b) adjourn, cancel or postpone the Scheme Meeting or the EGM; provided,
however, that Target may, without the
consent of Zoetis, adjourn, cancel or postpone the Scheme Meeting or the
EGM:
(i) in the case of adjournment, if directed by Target Shareholders to do
so pursuant to Article 89 of the Articles of Association (other than
pursuant to a proposal by Target or any of its directors or officers), or
(ii) to permit dissemination of information which is material to
shareholders voting at the Scheme Meeting or the EGM, but only for so
long as the Target Board determines in good faith, after having
consulted with outside counsel, that such action is reasonably necessary
or advisable to give Target Shareholders sufficient time to evaluate any
such disclosure or information so provided or disseminated; or
(iii) if, as of the time for which the Scheme Meeting or the EGM is
scheduled (as set forth in the Scheme Document), there are insufficient
Target Shares represented (either in person or by proxy) (i) to
constitute a quorum necessary to conduct the business of the Scheme
Meeting or the EGM, but only until a meeting can be held at which there
are a sufficient number of Target Shares represented to constitute a
quorum or (ii) voting for the approval of the Scheme Meeting Resolution
or the EGM Resolutions, as applicable (but only until Target determines
in good faith that a meeting can be held at which there are a sufficient
number of votes of holders of Target Shares to approve the Scheme
Meeting Resolution or the EGM Resolutions, as applicable); or
(c) amend the Resolutions (in each case, in the form set out in the
Scheme Document).
3.7 Switching to a Takeover Offer
(a) Zoetis may elect (with the Panel’s consent, if required) to
implement the Acquisition by way of a Takeover Offer (rather than the
Scheme), whether or not the Scheme Document has been posted, subject to
the terms of this Clause 3.7, and Zoetis shall notify Target promptly of
any such election (whether or not the implementation thereof is subject
to the consent of the Panel) made by it to implement the Acquisition by
way of a Takeover Offer (rather than the Scheme).
(b) Save where there has been a Target Change of Recommendation, if
Zoetis elects to implement the Acquisition by way of a Takeover Offer,
Target undertakes to provide Zoetis as promptly as is reasonably
practicable with all such information about Target (including directors
and their Concert Parties) as may be reasonably required for inclusion
in the Takeover Offer Documents and to provide all such other assistance
as may be reasonably required by the Takeover Rules in connection with
the preparation by Zoetis or Zoetis Bidco of the Takeover Offer
Documents, including access to, and ensuring the provision of reasonable
assistance by, Target’s Representatives.
(c) If Zoetis elects to implement the Acquisition by way of a Takeover
Offer, Target agrees:
(i) that the Takeover Offer Documents shall contain provisions in
accordance with the terms and conditions set out in the Rule 2.5
Announcement, the relevant Conditions and such other further terms and
conditions as agreed (including any modification thereto) between Zoetis
and Target; provided, however,
that the terms and conditions of the Takeover Offer shall be at least as
favourable to the Target Shareholders (except for the 80% acceptance
condition, which may be waived down to “50% plus one Target Share” by
Zoetis);
(ii) to co-operate and consult with Zoetis in the preparation by Zoetis
of the Takeover Offer Documents or any other document or filing which is
required for the purposes of implementing the Acquisition; and
(iii) unless the Target Board has effected a Target Change of
Recommendation pursuant to Clause 5.2, to incorporate in the Rule 2.5
Announcement and the Takeover Offer Documents a recommendation to the
holders of Target Shares from the Target Board to accept the Takeover
Offer, and such recommendation shall not be withdrawn, adversely
modified or qualified except as contemplated by Clause 5.2.
(d) If Zoetis elects to implement the Acquisition by way of the Takeover
Offer in accordance with Clause 3.7(a), the Parties mutually agree:
(i) to prepare and file with, or submit to, the SEC and, to the extent
necessary, the Panel and the High Court, all documents, amendments and
supplements required to be filed therewith or submitted thereto pursuant
to the Takeover Rules, the Securities Act or the Exchange Act or
otherwise required by Law, and to make any applications or initiate any
appearances that may be required by or desirable to the High Court for
the purpose of discontinuance of High Court proceedings initiated in
connection with the Scheme, and each Party shall have reasonable
opportunities to review and comment on all such documents, amendments
and supplements and, following reasonable accommodation of such comments
and approval of such documents, amendments and supplements by the other
Party, which shall not be unreasonably withheld, conditioned or delayed,
file or submit, as the case may be, such documents, amendments and
supplements with or to the SEC;
(ii) to promptly use all reasonable endeavours to discontinue any High
Court proceedings relating to the Scheme including, but not limited to,
ensuring: (i) the cancellation or indefinite postponement (as the case
may be) of the Scheme Meeting before it is commenced; and (ii) that the
Scheme Resolution is not put to a vote of the Target Shareholders;
(iii) to provide the other Party with any comments received from the SEC
on any documents filed by it with or furnished by it to the SEC as
promptly as is reasonably practicable after receipt thereof; and
(iv) to the extent reasonably practicable, to provide the other Party
with reasonable prior notice of any proposed oral communication with the
SEC and afford the other Party reasonable opportunity to participate
therein.
(e) If the Takeover Offer is consummated, Zoetis shall or shall cause
Zoetis Bidco to, use reasonable endeavours to effect as promptly as is
reasonably practicable a compulsory acquisition of any Target Shares
under Section 457 of the Act not acquired in the Takeover Offer for the
same consideration per share as under the Takeover Offer.
(f) For the avoidance of doubt and except as may be required by the
Takeover Rules (and without limiting any other provision of this
Agreement), nothing in this Agreement (save as provided in Clause 5.2)
shall require Target to provide Zoetis with any information with respect
to, or to otherwise take or fail to take any action in connection with
Target’s consideration of or response to, any Target Alternative
Proposal.
4. Rule 15 Proposals
4.1 Making of Rule 15 Proposals
The Rule 15 Proposals will be made jointly by Zoetis and Target, by a
letter or letters to be issued no later than five Business Days after
the issuance of the Scheme Document, to all the holders of the Target
Convertible Securities on the following basis:
(a) Target shall do everything necessary (except with respect to the
Warrants) to procure that with effect from the Effective Time:
(i) all Target Plans shall be terminated by Target and/or any of its
Affiliates;
(ii) all Target Convertible Securities, whether vested or unvested, that
are outstanding and unexercised as of immediately prior to the Effective
Time shall, at the Effective Time, automatically (and without any action
on the part of any holder thereof) be cancelled and terminated and shall
no longer be exercisable for or convertible into Target Shares except
that:
(A) if the exercise or conversion price per ordinary share of any Target
Convertible Security (whether or not vested) that is outstanding as of
immediately prior to the Effective Time is less than the Consideration,
it shall be converted into the right of the holder thereof to receive
the Rule 15 Consideration set forth in Clause 4.1(b) less such taxes,
levies and/or withholding as are required to be made by Law if any and
as applicable, upon the terms and subject to the conditions set forth in
this Agreement; and
(B) if the exercise or conversion price per ordinary share of any Target
Convertible Security (whether or not vested) that is outstanding as of
immediately prior to the Effective Time is equal to or exceeds the
Consideration, such Target Convertible Security shall be cancelled as of
the Effective Time without the payment of any amount or other
consideration in respect thereof.
(b) For each Target ordinary share issuable upon exercise or conversion
of a Target Convertible Security, the Rule 15 Consideration shall be the
Consideration less the exercise or option price payable by or on behalf
of the holder for the purpose of exercising or converting such Target
Convertible Security.
(c) Zoetis may cause Target, after the Effective Date, to deliver the
Rule 15 Consideration to the applicable former holder of Target
Convertible Securities via Target’s payroll system where doing so is
necessary to ensure the payment of all taxes, levies and/or withholding
as are required to be made by Law;
(d) Subject only to the payment of the Rule 15 Consideration, neither
Zoetis nor any of its Affiliates shall be required:
(i) to replace, assume or adopt any Target Plan;
(ii) to replace, assume or adopt any Target Convertible Securities,
whether vested or unvested, in connection with the Transactions.
(e) Prior to the Effective Time, Target shall take all necessary
actions, including obtaining appropriate resolutions of the Target Board
(or applicable committee thereof), providing all notices, obtaining any
necessary consents (except as to the Warrants), and taking all other
actions necessary or desirable to effect the termination of the Target
Plans and all Target Convertible Securities (except as to the Warrants)
outstanding thereunder and to provide for and give effect to the
provisions of Clause 4, which notices, resolutions, consents and other
written materials shall be subject to the review and approval of Zoetis,
who shall be provided a reasonable opportunity for such review and
approval, which shall not be unreasonably withheld, conditioned or
delayed.
4.2 Amendments to Rule 15 Proposals
Neither Party shall amend the Rule 15 Proposals without the consent of
the other Party (such consent not to be unreasonably withheld,
conditioned or delayed).
4.3 Amendment of Articles
Target shall procure that a resolution is put to the Target Shareholders
at the EGM proposing that the Articles of Association be amended so that
any Target Shares allotted and issued following the EGM will either be
subject to the terms of the Scheme or will be acquired by Zoetis Bidco
for the same consideration per Target Share as shall be payable to
Target Shareholders by Zoetis Bidco under the Scheme on the basis that
such consideration shall become payable in respect of each Target Share
within fourteen calendar days following the allotment of such Target
Shares. Target shall not allot and issue any Target Shares between the
voting record time for the EGM and the EGM or, other than pursuant to
options or other awards that are fully exercisable under the terms of
the Target Plans or the Warrants, between the Court Hearing Record Time
and the Effective Time.
5. Target and Zoetis Conduct
5.1 Conduct of Business by Target
(a) At all times from the execution of this Agreement until the earlier
of the Effective Time and the date, if any, on which this Agreement is
terminated pursuant to Clause 9, except as may be required by Law, or as
required or expressly permitted by this Agreement, or with the prior
written consent of Zoetis, Target shall, and shall cause each of its
Subsidiaries to, conduct its business in the ordinary course of business
consistent with past practice in all material respects.
(b) Target covenants with Zoetis in the manner set forth in Schedule 1.
5.2 Non-Solicitation
(a) Subject to any actions which Target is required to take so as to
comply with the requirements of the Takeover Rules, Target agrees that
neither it nor any member of the Target Group shall, and that it shall
use all reasonable endeavours to cause its and their respective
Representatives and any Concert Party of Target not to, directly or
indirectly:
(i) solicit, initiate, facilitate or encourage any enquiry with respect
to, or the making or submission of, any Target Alternative Proposal or
any proposal which would reasonably be expected to lead to a Target
Alternative Proposal;
(ii) participate in any discussions or negotiations regarding a Target
Alternative Proposal with, or, save as required by Law, furnish any
non-public information regarding Target to, any person that has made or,
to the Knowledge of Target, is considering making a Target Alternative
Proposal, except to notify such person as to the existence of this
Section 5.2; or
(iii) expressly waive, terminate, amend or modify any provision of any
“standstill” or similar obligation of any person with respect to any
member of the Target Group; provided that Target shall not be
(i) prohibited from permitting any person to make a Target Alternative
Proposal privately to the Target Board or (ii) required to take, or be
prohibited from taking, any action otherwise prohibited or required by
this sub-Clause (iii) if the Target Board determines, in good faith
(after consultation with its outside legal counsel), that failure to
take such action or permit such inaction would be inconsistent with the
directors’ fiduciary duties under applicable Law.
Target shall, and shall cause its Subsidiaries and its and their
respective Representatives and shall use all reasonable endeavours to
cause its and their Concert Parties to, immediately cease and cause to
be terminated all existing discussions or negotiations with any person
conducted heretofore with respect to any Target Alternative Proposal, or
any enquiry or proposal that may reasonably be expected to lead to a
Target Alternative Proposal, request the prompt return or destruction of
all confidential information previously furnished in connection
therewith and immediately terminate all physical and electronic data
room access previously granted to any such person or its
Representatives. Target shall be responsible for any act done by one of
its Concert Parties which, if done by Target, would constitute a breach
of the foregoing provisions of this Clause 5.2(a).
(b) Notwithstanding the limitations set forth in Clause 5.2(a), if
Target receives a written Target Alternative Proposal which did not or
does not result from a knowing or intentional breach of Clause 5.2(a),
Target may take any or all of the following actions:
(i) contact the person who makes such Target Alternative Proposal to
understand the terms and conditions thereof;
(ii) furnish non-public information to the third party (and any persons
Acting in Concert with such third party and to their respective
potential financing sources and Representatives) making such Target
Alternative Proposal (provided that all such information has previously
been provided to Zoetis or is provided to Zoetis concurrently with the
time it is provided to such person(s)), if, and only if, prior to so
furnishing such information, Target receives from the third party an
executed confidentiality agreement, or as of the date hereof such third
party is party to such a confidentiality agreement, containing terms no
less restrictive on such third party than the terms in the Zoetis
Confidentiality Agreement are restrictive on Zoetis; provided,
however, that if such confidentiality
agreement is executed after the date hereof, such confidentiality
agreement shall permit Target to disclose all information contemplated
by Clause 5.2(c) to Zoetis); and
(iii) engage in discussions or negotiations with the third party (and
such other persons) with respect to such Target Alternative Proposal;
provided that Target shall not be permitted to take the action set forth
in sub-clauses 5.2(b)(ii) or 5.2(b)(iii) unless the Target Board has
determined in good faith (after consultation with Target’s financial
advisers and outside legal counsel) that such Target Alternative
Proposal is, or would reasonably be expected to lead to, a Target
Superior Proposal.
(c) Target shall promptly (and in any event within 24 hours of receipt
of any Target Alternative Proposal) notify Zoetis of the receipt of any
Target Alternative Proposal and shall indicate the material terms and
conditions of such Target Alternative Proposal and the identity of the
person making any such Target Alternative Proposal, and thereafter shall
promptly keep Zoetis reasonably informed of any material change to the
terms of any such Target Alternative Proposal. Target shall provide to
Zoetis as soon as reasonably practicable after receipt or delivery
thereof (and in any event within 24 hours of receipt or delivery) copies
of all written correspondence and other written material exchanged
between any member of the Target Group (or any of their respective
Representatives) and the person making a Target Alternative Proposal (or
such person’s Representatives) that describes the material terms or
conditions of such Target Alternative Proposal, including draft
agreements, indications of interest or term sheets submitted by either
party in connection therewith. Target shall not, and shall cause its
Subsidiaries not to, enter into any confidentiality agreement with any
person following the date hereof that prohibits Target from providing
such information to Zoetis.
(d) Except as set forth in Clause 5.2(e), neither the Target Board nor
any committee thereof shall:
(i) withdraw (or modify in any manner adverse to Zoetis), or propose
publicly to withdraw (or modify in any manner adverse to Zoetis), the
Scheme Recommendation;
(ii) approve, recommend or declare advisable, or propose publicly to
approve, recommend or declare advisable, any Target Alternative Proposal
(any of the foregoing actions in this Clause 5.2(d) being a “Target
Change of Recommendation”) (it being agreed that the provision by
Target to Zoetis of notice or information in connection with a Target
Alternative Proposal or Target Superior Proposal as required or
expressly permitted by this Agreement shall not, in and of itself,
constitute a Target Change of Recommendation); or
(iii) cause or allow any member of the Target Group to execute or enter
into, any expenses reimbursement or break fee payment agreement, letter
of intent, memorandum of understanding, agreement in principle, merger
agreement, acquisition agreement, transaction agreement, implementation
agreement, option agreement, joint venture agreement, alliance
agreement, partnership agreement or other agreement constituting or with
respect to, or that would reasonably be expected to lead to, any Target
Alternative Proposal, or requiring, or reasonably expected to cause,
Target to abandon, terminate, delay or fail to consummate the
Acquisition other than as contemplated by Clause 9.1(a)(ix) and other
than a confidentiality agreement referred to in Clause 5.2(b).
(e) Nothing in this Agreement shall prohibit or restrict the Target
Board from making a Target Change of Recommendation if the Target Board
has given not less than 48 hours’ notice to Zoetis of the holding of a
meeting of the Target Board (or a committee thereof) at which a Target
Change of Recommendation is to be considered and has concluded, in good
faith (after consultation with Target’s outside legal counsel and
financial advisers) that:
(i) the relevant Target Alternative Proposal constitutes a Target
Superior Proposal; and
(ii) that the failure to make a Target Change of Recommendation would be
inconsistent with the directors’ fiduciary duties under applicable Law,
provided that (x) promptly (and in any event within 48 hours) following
the Target Board’s determination (after consultation with Target’s
outside legal counsel and financial advisers) that the relevant Target
Alternative Proposal constitutes a Target Superior Proposal, Target has
provided a written notice to Zoetis (a “Superior Proposal Notice”)
advising Zoetis that Target has received a Target Alternative Proposal
and specifying the material terms of such Target Alternative Proposal,
the identity of the person making such Target Alternative Proposal and
such other information with respect thereto required by Clause 5.2(c)
and including written notice of the determination of the Target Board
that such Target Alternative Proposal constitutes a Target Superior
Proposal, (y) Target has provided Zoetis with an opportunity, for a
period of five Business Days following the time of delivery to Zoetis of
the Superior Proposal Notice (as it may be extended pursuant to the last
sentence of this Clause 5.2(e), the “Notice Period”), to
discuss in good faith the terms and conditions of this Agreement and the
Transactions, including an increase in, or modification of, the
Consideration, and such other terms and conditions such that the
relevant Target Alternative Proposal no longer constitutes a Target
Superior Proposal, and (z) following the expiration of such Notice
Period, the Target Board has determined in good faith (after
consultation with Target’s outside legal counsel and financial advisers)
that the relevant Target Alternative Proposal continues to constitute a
Target Superior Proposal taking into account all changes proposed in
writing by Zoetis during the Notice Period and has provided to Zoetis a
further written notice to such effect (a “Final Recommendation Change
Notice”). If, during the Notice Period any material revision is made
to the financial terms or other material terms and conditions of the
relevant Target Alternative Proposal in writing, Target shall, promptly
following each such revision, deliver a new Superior Proposal Notice to
Zoetis and comply with the requirements of this Clause 5.2(e) with
respect to such new Superior Proposal Notice, except that the Notice
Period shall be the greater of two Business Days and the amount of time
remaining in the initial Notice Period.
(f) Nothing contained in this Agreement shall prohibit or restrict
Target or the Target Board from (a) making any disclosure to the Target
Shareholders required by Law (after consultation with Target’s outside
legal counsel) provided such disclosure does not constitute a Target
Change of Recommendation or (b) taking and disclosing to the Target
Shareholders a position contemplated by Rule 14e-2(a), Rule 14d-9 or
Item 1012(a) of Regulation M-A promulgated under the Exchange Act (or
any similar communication to shareholders); provided,
however, that in no event shall this
Clause 5.2(f) affect the obligations of Target set forth in
Clauses 5.2(a) through 5.2(e), inclusive; provided, further, that any
such disclosure pursuant to sub-clause (b) above shall constitute a
Target Change of Recommendation unless such disclosure (i) expressly
states that the Scheme Recommendation has not changed, (ii) expressly
states that the Target Board rejects the applicable Target Alternative
Proposal or (iii) is a “stop, look and listen” communication
contemplated by Rule 14d-9(f) promulgated under the Exchange Act.
6. Warranties
6.1 Target Warranties
Except (i) as fairly and accurately disclosed in Part A of the Target
Disclosure Letter, which identifies items of disclosure by reference to
a particular Clause or sub-clause of this Agreement, as applicable, or
any other part of Part A of the Target Disclosure Letter where it is
reasonably apparent on its face based on the substance of such
disclosure or the context in which such disclosure is made that such
disclosure shall be deemed to be disclosed with respect to any other
Clause or sub-clause of this Agreement, and (ii) as disclosed in
Target’s Annual Report on Form 10-K for the fiscal year ended on June
30, 2016 filed with the SEC, Target’s Quarterly Report on Form 10-Q for
the quarter ended December 31, 2016 filed with the SEC, or disclosed in
a Target Current Report on Form 8-K filed with or furnished to the SEC
(in each case, excluding any disclosures in any “risk factors” section,
any disclosures in any “forward-looking statements” section and any
other disclosures included therein to the extent they are predictive or
forward-looking in nature), Target represents and warrants to Zoetis
Group as of the date hereof as follows:
(a) Organisation; Organisational Documents. Each of Target and
each of its Subsidiaries is a legal entity duly organised, validly
existing and, where relevant, in good standing under the Laws of its
respective jurisdiction of organisation and has all requisite corporate
or similar power and authority to own, lease and operate its properties
and assets and to carry on its business as presently conducted and is
qualified to do business and is in good standing as a foreign
corporation in each jurisdiction where the ownership, leasing or
operation of its assets or properties or conduct of its business
requires such qualification. Target has delivered to Zoetis, prior to
the date hereof, true and correct copies of the Organisational Documents
of Target and each of its Subsidiaries, including the Articles of
Association as amended to the date hereof. The Articles of Association
are in full force and effect and Target is not in violation of any of
the provisions of the Articles of Association. No Subsidiary of Target
is in violation of any of the provisions of its Organisational Documents
in any material respect.
(b) Subsidiaries. Clause 6.1(b) of Part A of the Target
Disclosure Letter contains a true and correct list of all members of the
Target Group, their place of organisation, the ownership interest of
Target in each such Subsidiary and the ownership interest of any other
Person or Persons in each such Subsidiary, including the number and type
of ownership interests or other voting interests in such Subsidiary. All
the issued and outstanding shares of capital stock of, or other equity
interests in, each Subsidiary of Target have been validly issued and are
fully paid and non-assessable and are owned, directly or indirectly, by
Target free and clear of all Encumbrances, other than Permitted
Encumbrances.
(c) Capitalisation.
(i) The authorised share capital of Target consists of 100,000,000
Target Shares, 400 Euro Deferred Shares with a nominal value of €100
each, and 10,000,000 Preferred Shares of $0.01 each. As at April 12,
2017 (the “Capitalisation Date”):
(A) 11,910,615 Target Shares were issued and outstanding;
(B) 400 Euro Deferred Shares (partly paid) with a nominal value of €100
each in the capital of Target were issued and held by the Persons
identified in Clause 6.1(c)(i)(B) of Part A of the Target Disclosure
Letter (with the amount of Euro Deferred Shares held by such Person
opposite such Person’s name);
(C) no Target Shares were held in treasury;
(D) 76,595 Target Shares were reserved for issuance pursuant to the
Target 2013 Plan, of which number (A) 3,650 Target Shares were subject
to outstanding Target RSUs, each with a conversion price equal to $0.125
and (B) 72,945 Target Shares were issuable upon the exercise of
outstanding Target Options granted under the Target 2013 Plan, each with
an exercise price equal to $0.125;
(E) 1,191,061 Target Shares were reserved for issuance pursuant to the
Target 2015 Plan, of which number (i) 650,391-Target Shares were subject
to outstanding Target RSUs, each with a conversion price equal to
$0.125, and (ii) 420,000-Target Shares were issuable upon the exercise
of outstanding Target Options granted under the Target 2015 Plan,
including (x) 60,000 Target Shares issuable upon the exercise Target
Options each with an exercise price equal to $5.10, and
(y) 360,000-Target Shares issuable upon the exercise of outstanding IPO
Options each with an exercise price equal to $15.00;
(F) 145,069 Target Shares are subject to outstanding Buyback Options,
each with an exercise price equal to $6.35;
(G) no Target Shares were beneficially owned by any Subsidiary of Target;
(H) no Target Shares are issuable pursuant to the Target 2012 Plan or
the Target 2013 Australian Plan. The Target 2012 Plan and the Target
2013 Australian Plan have been terminated and there are no outstanding
Target RSUs, Target Options, restricted share units, warrants, options
or other instruments convertible or exercisable for Target Shares under
the Target 2012 Plan or the Target 2013 Australian Plan;
(I) 1,766,998 Target Shares were reserved for issuance upon exercise of
the Warrants and that the grant date and exercise prices for such
Warrants are correct as set out in the definition of Warrants in Clause
1.1; and
(J) no Preferred Shares were issued and outstanding.
(ii) Clause 6.1(c)(ii) of Part A of the Target Disclosure Letter sets
forth, at the Capitalisation Date:
(A) the number of Target Shares that were subject to each Target Option
outstanding under the Target 2013 Plan and Target 2015 Plan and the
exercise price per Target Share of each such Target Option;
(B) the number of Target Shares that were subject to Target RSUs; and
(C) the number of Target Shares that were subject to the Warrants and
the exercise price per Target Share of each such Warrant.
(iii) All of the outstanding Target Shares are, and all Target Shares
available for issuance as noted above shall be, when issued in
accordance with the respective terms thereof, duly authorised, validly
issued, fully paid and non-assessable and free of pre-emptive rights.
(iv) The Target Plans (together with any related forms of agreements,
each of which have been previously provided to Zoetis) are the only
understandings, arrangements or agreements, under which restricted share
units, warrants, options, awards or other instruments convertible or
exercisable for Target Shares were issued that are currently issued and
outstanding, except for agreements regarding the Warrants. Full details
of the exercise price of all such restricted share units, warrants,
options, awards or other instruments convertible or exercisable for
Target Shares have been disclosed to Zoetis.
(v) Except as set forth in Clauses 6.1(c)(i) and 6.1(c)(ii), as of the
Capitalisation Date: (i) no shares in the share capital of Target or
other voting securities of Target were issued, reserved for issuance or
outstanding, and (ii) there were no outstanding subscriptions, options,
warrants, puts, calls, exchangeable or convertible securities or other
similar rights, agreements or commitments relating to the issuance of
shares of capital to which any member of the Target Group is a party
obligating any member of the Target Group to (A) issue, transfer or sell
any shares in the capital or other equity interests of any member of the
Target Group or securities convertible into or exchangeable for such
shares or equity interests (in each case other than to any member of the
Target Group); (B) grant, extend or enter into any such subscription,
option, warrant, put, call, exchangeable or convertible securities or
other similar right, agreement or commitment; (C) redeem or otherwise
acquire any such shares in its capital or other equity interests; or
(D) provide a material amount of funds to, or make any material
investment (in the form of a loan, capital contribution or otherwise)
in, any Subsidiary that is not wholly owned.
(vi) No member of the Target Group has outstanding bonds, debentures,
notes or other similar obligations, the holders of which have the right
to vote (or which are convertible into or exercisable for securities
having the right to vote) with the Target Shareholders on any matter.
(vii) There are no voting trusts or other agreements or understandings
to which any member of the Target Group is a party with respect to the
voting of the shares in the capital or other equity interest of any
member of the Target Group.
(viii) No “fair price,” “moratorium,” “control share acquisition” or
other similar anti-takeover statute or regulation or any anti-takeover
provision in the Articles of Association is, or at Completion will be,
applicable to Target or the Transactions.
(d) Corporate Authority.
(i) Target has all requisite corporate power and authority to enter into
this Agreement and the Expenses Reimbursement Agreement, subject (in the
case of this Agreement) to receipt of the Target Shareholder Approval to
consummate the Transactions in accordance with the terms of this
Agreement and the Expenses Reimbursement Agreement. The execution and
delivery of this Agreement and the Expenses Reimbursement Agreement and
the consummation of the Transactions have been duly and validly
authorised by the Target Board and, except for (i) the Target
Shareholder Approval, (ii) the filing of the required documents and
other actions in connection with the Scheme with, and the receipt of the
required approval of the Scheme by, the High Court, and (iii) the filing
of the Court Order with the Registrar of Companies, no other corporate
proceedings on the part of Target are necessary to authorise the
consummation of the Transactions. On or prior to the date hereof, the
Target Board has determined that the Transactions are fair and
reasonable and in the best interests of Target and the Target
Shareholders and has adopted a resolution to make, subject to Clause 5.2
and to the obligations of the Target Board under the Takeover Rules, the
Scheme Recommendation. This Agreement has been duly and validly executed
and delivered by Target and, assuming this Agreement constitutes the
valid and binding agreement of Zoetis, constitutes the valid and binding
agreement of Target, enforceable against Target in accordance with its
terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium and other similar laws affecting creditors rights
generally and by general principles of equity.
(ii) Other than in connection with or in compliance with (i) the
provisions of the Act, (ii) the Takeover Panel Act and the Takeover
Rules, (iii) the Securities Act, (iv) the Exchange Act, (v) any
applicable requirements of NASDAQ, no Governmental Authorisation
is necessary, under applicable Law, for the consummation by Target of
the Transactions, except for such Governmental Authorisations, (A) that,
if not obtained or made, would not reasonably be expected to materially
impede or materially delay Completion, or prevent the consummation of
the Acquisition or have a material adverse effect on the Target Group,
or (B) as may arise as a result of facts or circumstances solely
relating to Zoetis or its Affiliates or Laws or Contracts binding on
Zoetis or its Affiliates.
(iii) Assuming compliance with the Scheme, Chapter 1 of Part 9 of the
Act and any directions or orders of the High Court, none of the
execution, delivery or performance of this Agreement or the consummation
of the Transactions, including the Acquisition, will: (i) contravene,
conflict with or result in a violation of any of the provisions of the
Articles of Association or other Organisational Documents of any member
of the Target Group; (ii) contravene or conflict with, or result in a
violation of, any applicable Law or any order, ruling, writ, injunction,
judgment, arbitration award or decree to which Target, or any of the
material assets owned by any member of the Target Group, is subject; or
(iii) result in the creation of an Encumbrance (other than Permitted
Encumbrances) on any of the properties or assets of Target or any of its
Subsidiaries, except, in the case of each of clauses (ii) and (iii), for
any conflicts, violations, breaches, defaults, alterations,
terminations, amendments, accelerations, cancellations or liens, or
where the failure to obtain any consents, in each case, would not
reasonably be expected to have, individually or in the aggregate,
a material adverse effect on the Target Group.
(e) Investment Company. No member of the Target Group is required
to register as an “investment company” within the meaning of the US
Investment Company Act of 1940, as amended.
(f) Legal Compliance. Each member of the Target Group and each of
their respective businesses and their respective directors and officers
(in their capacities as such) are, and during the last 36 months have
been, in compliance in all material respects with all applicable Laws,
Industrial Instruments, Contracts, policies and all applicable orders,
rulings, decrees, writs, injunctions, assessment, decisions, codes of
conduct, judgments or arbitration awards of any court or arbitrator or
of any Governmental Body (collectively, “Orders”), including with
respect to employment, employment practices, terms and conditions of
employment, wages, hours, WARN Act (in the United States) and other
comparable applicable non-US Laws, and all applicable Laws and
applicable Orders covering discrimination, equal employment opportunity,
labour relations, leave of absence, occupational and work health and
safety, workers’ compensation, wrongful termination or discharge or
violation of the personal rights of employees, privacy, data protection,
advertising, consumer protection, anti-corruption (e.g. the UK Bribery
Act of 2010 and the US Foreign Corrupt Practices Act of 1977),
antitrust, fair competition, securities, corporate, disclosure,
reporting, Taxes (provided that, as to Taxes, such Laws shall be limited
to those governing the filing of Tax Returns, the payment and collection
of Taxes and the determinations of amounts in respect of such filings,
payments and collections), the Act, regulatory requirements (including
the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §§ 301 et seq.), the
Virus-Serum-Toxin Act (21 U.S.C. §§ 151 et. seq.), the Animal Welfare
Act (7 U.S.C. §§ 2131 et seq.) and their implementing regulations,
environmental and Intellectual Property. Each member of the Target Group
holds all material Governmental Authorisations required to lawfully
operate its business as currently conducted, including those required to
research, develop, test or manufacture any of the Target Products, to
lease and operate the properties and assets of any member of the Target
Group, otherwise required to carry on the business of the Target Group
as it is now currently being conducted or any third-party services as
they are now currently being conducted, or that are otherwise material
to the business or third-party services of any member of the Target
Group. Assuming compliance with the provisions of this Agreement, none
of the execution, delivery or performance of this Agreement or the
consummation of the Acquisition will give any Governmental Body the
right to revoke, withdraw, suspend, cancel, terminate, modify, or
otherwise take any action against or with respect to any material
Governmental Authorisation that is held by any member of the Target
Group, except for the consent of the Australian Government Department of
Industry, Innovation and Science and the Irish Department of Jobs,
Enterprise and Innovation (through its agency Industrial Development
Agency (Ireland)).
(g) Litigation and Claims. During the prior 36 months, (a) there
has been no material investigation or review pending (or, to the
Knowledge of Target, threatened) by any Governmental Body with respect
to any member of the Target Group or any of their businesses or
properties, and (b) there have been no material Actions pending (or, to
the Knowledge of Target, threatened) against any member of the Target
Group or any of their respective businesses or properties.
(h) Liabilities. Except (a) as and to the extent disclosed,
reflected or reserved against on the Most Recent Balance Sheet
(including any notes thereto), (b) for liabilities incurred in the
ordinary course of business consistent with past practice since the date
of the Most Recent Balance Sheet, (c) as expressly permitted or required
by this Agreement or incurred in connection with the preparation and
negotiation of this Agreement and/or the Transactions, including
Target’s associated strategic process, but in each case not involving
any breach of any Contract, and (d) for liabilities which have been
discharged or paid in full in the ordinary course of business, no member
of the Target Group has any material obligations or material
liabilities, whether accrued, contingent or otherwise, that would be
required by US GAAP to be reflected on a consolidated balance sheet of
Target and its consolidated Subsidiaries (or in the notes thereto).
(i) Sufficiency. The Target Group owns, licenses or leases all
properties, assets and rights used to conduct the business of the Target
Group. Such properties, assets and rights are sufficient to conduct the
business of Target and its Subsidiaries substantially in the same manner
as it is conducted as of the date of this Agreement by Target and its
Subsidiaries. The properties, assets and rights owned, licensed and
leased by Target and its Subsidiaries are in all material respects
adequate for the purposes such properties, assets and rights are
currently used or held for use, and are in reasonably good repair and
operating condition (subject to normal wear and tear).
(j) Contracts.
(i) Clause 6.1(j)(i) of Part A of the Target Disclosure Letter contains
a list of all Contracts in effect as of the date hereof (as amended or
supplemented) to which any member of the Target Group is a party, or by
which any property or asset of any member of the Target Group is bound
(each a “Material Contract”) that (i) provides by its terms for
payments in excess of $200,000 per annum or receipts in excess of
$400,000 per annum; (ii) is a “material contract” (as such term is
defined in Item 601(b)(10) of Regulation S-K of the SEC); (iii) imposes
on any member of the Target Group any material restriction or
prohibition with respect to: (A) competing with any other Person;
(B) acquiring any product or other asset or any services from any other
Person; (C) developing, selling, supplying, distributing, offering,
supporting or servicing any product or any other asset; (D) performing
services for or investing in any other Person; or (E) other than as
required by applicable Law, engaging in any business anywhere in the
world; (iv) grants a right of first refusal, first offer or similar
right with respect to a material asset or material portion of Target’s
business; (v) provides for any joint venture, off-balance sheet
partnership or any similar arrangement (including any Contract relating
to any transaction or relationship between or among any member of the
Target Group, on the one hand, and any unconsolidated Affiliate,
including any structured finance, special purpose or limited purpose
entity or Person, on the other hand, or any “off-balance sheet
arrangements” (as defined in Item 303(a) of Regulation S-K)), where the
result, purpose or effect of such Contract is to avoid disclosure of any
material transaction involving, or material liabilities of, any member
of the Target Group in Target’s published financial statements or any
Target SEC Documents; (vi) except for this Agreement and the agreements
contemplated hereby, imposes or, to the Knowledge of Target, purports on
its face to impose any material obligation on Zoetis or any of its
Subsidiaries (other than, after Completion, any member of the Target
Group); (vii) is an employment or consulting Contract with any (A)
current or former Executive Officer, (B) member of the Target Board, or
(C) employee of any member of the Target Group providing for an annual
base salary in excess of $200,000, (viii) provides for indemnification
or any guaranty by any member of the Target Group or for any increase or
supplement to any remuneration, compensation or benefit of an employee
or consultant that is material to Target or any of its Subsidiaries;
(ix) is an employee collective bargaining agreement or other Contract
with any labour union; (x) is a mortgage, indenture, guarantee, loan or
credit agreement, security agreement or other Contract, in each case
relating to indebtedness for borrowed money, whether as borrower or
lender, in each case in excess of $200,000; (xi) relates to the sale,
disposition or acquisition, directly or indirectly, by any member of the
Target Group after the date of this Agreement of assets with a fair
market value in excess of $500,000; or (x) is a licence, covenant or
other right or agreement with respect to any third-party Intellectual
Property used in, used in the development of or related to any Target
Products. Target has made available to Zoetis true and correct copies of
all Material Contracts.
(ii) (A) all the Material Contracts are valid and binding on Target or
its applicable Subsidiary, enforceable against it in accordance with its
terms, and is in full force and effect, (B) neither Target nor any of
its Subsidiaries nor, to the Knowledge of Target, any third party has
violated any provision of, or failed to perform any obligation required
under the provisions of, any Material Contract, and (C) neither Target
nor any of its Subsidiaries nor, to the Knowledge of Target, any third
party is in breach, or has received written notice of breach, of any
Material Contract.
(iii) None of the execution, delivery or performance of this Agreement
or the consummation of the Acquisition will contravene or conflict with
in any material respect, or result in a material violation or breach of,
or result in a default under, any Material Contract, or give any Person
the right (with or without notice or lapse of time) to: (i) declare a
default or exercise any material remedy under any Material Contract;
(ii) accelerate the maturity or performance of any Material Contract; or
(iii) cancel, terminate or modify in any material respect any Material
Contract.
(k) Financial Controls and Statements; SEC Documents.
(i) Target has filed or furnished all reports, schedules, forms,
statements, registration statements, prospectuses and other documents
(including exhibits and other information incorporated therein) required
to be filed or furnished by Target with the SEC under the Securities Act
or the Exchange Act since January 1, 2015, except as may not reasonably
be expected to result in a material adverse effect on Target. No
Subsidiary of Target is, or has at any time since January 1, 2015, been,
subject to the periodic reporting requirements of the Exchange Act or is
or has been otherwise required to file any form, report, statement,
schedule, certificate or other document with the SEC.
(ii) Target maintains a system of “internal control over financial
reporting” (as defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act) reasonably designed to provide reasonable assurance that:
(i) transactions are recorded as necessary to permit preparation of
financial statements in conformity with US GAAP; (ii) receipts and
expenditures are executed only in accordance with the authorisation of
management and the directors of Target; and (iii) any unauthorised
acquisition, use, or disposition of the Target Group’s assets that could
have a material effect on Target’s financial statements would be
detected or prevented in a reasonably timely manner. Target maintains,
with respect to the Target Group, a system of “disclosure controls and
procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act) designed to ensure that all material information
concerning the Target Group is made known on a reasonably timely basis
to the individuals responsible for the preparation of the Target SEC
Documents and other required public disclosure documents, and otherwise
to ensure that information required to be disclosed by Target in the
reports that it files or furnishes under the Exchange Act is recorded,
processed, summarised and reported within the time periods specified in
the SEC’s rules, to allow timely decisions regarding required disclosure
and to make the required certifications in connection therein.
(iii) Target has disclosed to Target’s outside auditors and the audit
committee of Target (and made copies of such disclosures available to
Zoetis): (i) all “significant deficiencies” and “material weaknesses” in
the design or operation of internal controls over financial reporting
(as defined in Rule 13a-15(f) of the Exchange Act) of which Target has
Knowledge and that are reasonably likely to adversely affect in any
material respect Target’s ability to record, process, summarise and
report financial data; and (ii) any fraud, whether or not material, that
involves management or other employees who have a significant role in
Target’s internal controls over financial reporting. Target has not
received from its independent accountants any notification of any:
(A) “significant deficiency” in the internal controls over financial
reporting; (B) “material weakness” in the internal controls over
financial reporting; or (C) fraud, whether or not material, that
involves management or other employees who have a significant role in
the internal controls over financial reporting. For purposes of this
Agreement, the terms “significant deficiency” and “material weakness”
shall have the meanings assigned to them by the Public Company
Accounting Oversight Board in Auditing Standard No. 5.
(iv) The financial statements (including any related notes) contained in
the Target SEC Documents, other than the financial information furnished
as part of Target’s periodic earnings releases, (A) were prepared in
accordance with US GAAP applied on a consistent basis throughout the
periods covered (except as may be indicated in the notes to such
financial statements or, in the case of unaudited statements, as
permitted by the SEC, and except that the unaudited financial statements
may not contain footnotes and are subject to normal and recurring
year-end adjustments that are not expected to be, individually or in the
aggregate, material in amount); and (B) fairly present in all material
respects the consolidated financial position of the Target Group as of
the respective dates thereof and the consolidated results of operations
and cash flows of the Target Group for the periods covered thereby
(subject, with respect to unaudited interim statements, to normal and
recurring year-end adjustments that are not expected to be, individually
or in the aggregate, material in amount).
(v) As of its respective date, or, if amended prior to the date hereof,
as of the date of the last such amendment, each of the Target SEC
Documents complied when filed or furnished (or, if applicable, when
amended) in all material respects with the requirements of the
Securities Act, the Exchange Act and the Sarbanes-Oxley Act of 2002 and
the related rules and regulations promulgated thereunder or under the
Exchange Act (the “Sarbanes-Oxley Act”), in each case to the
extent applicable to such Target SEC Documents, and none of the Target
SEC Documents when filed or furnished (or in the case of a registration
statement under the Securities Act, at the time it was declared
effective) contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(l) Tax Matters. Each of the Tax Returns required to be filed by
or on behalf of Target and each member of the Target Group: (i) has, in
the case of any Tax Return for material Taxes, been timely filed (after
giving effect to any valid extensions of time in which to make such
filing); and (ii) is accurate and complete in all material respects.
Target has made available to Zoetis: (A) accurate and complete copies of
all Tax Returns of Target and each member of the Target Group relating
to Taxable periods ended on or after December 31, 2012 that are listed
in Clause 6.1(l) of Part A of the Target Disclosure Letter; and (B) any
audit report issued by a Governmental Body within the last three years
relating to any Taxes due from or with respect to Target and each member
of the Target Group. Target and each member of the Target Group have,
within the time and manner prescribed by applicable Law, paid all Taxes
required to be paid by any of them, including any Taxes required to be
withheld from amounts owing to any employee, creditor, or third party
(in each case, whether or not shown on any Tax Return), except with
respect to matters being contested in good faith through appropriate
proceedings or for which adequate reserves have been established in
accordance with US GAAP. All Taxes due and payable by Target and each
member of the Target Group have been adequately provided for, in
accordance with US GAAP, in the financial statements of Target and each
member of the Target Group for all periods ending on or before the date
of such financial statements. During the last three years, no claim has
been made in writing by a Tax Authority in a jurisdiction where any of
Target or any member of the Target Group does not file Tax Returns that
such Person is or may be subject to taxation by that jurisdiction There
are no Encumbrances for Taxes (other than Permitted Encumbrances). There
are no unsatisfied liabilities for Taxes with respect to any notice of
deficiency or similar document received by Target or any member of the
Target Group with respect to any Tax.
(m) Intellectual Property.
(i) Clause 6.1(m)(i) of Part A of the Target Disclosure Letter contains
an accurate and complete list of (a) all registered Intellectual
Property, (b) all unregistered Intellectual Property, and (c) all
unregistered Intellectual Property for which an application is currently
pending, in each case, that is owned singularly or jointly with a third
party, purported to be owned singularly or jointly with a third party,
licensed to, licensed from, owned by, or otherwise authorised for use,
or held for use by Target, and is specified as such in Part A of the
Target Disclosure Letter, by Target (collectively “Target
Intellectual Property”). The Target Disclosure Letter identifies the
Target Intellectual Property by title, by owners (for third-party
Intellectual Property), by type, by country, by application filing
number (if applicable) and if registered, by any registration number,
and includes any additional information needed to identify any listed
unregistered Intellectual Property.
(ii) Target exclusively owns and exclusively possesses all right, title
and interest in and to the Target Intellectual Property, except for the
Intellectual Property disclosed in the Target Disclosure Letter as
licensed to Target, and such ownership or possession is free and clear
of all Encumbrances. The Target Intellectual Property includes all
Intellectual Property necessary and sufficient for, or otherwise
material to, the current and contemplated conduct of the business of
Target. Each registered item of the Target Intellectual Property is
valid, subsisting and enforceable, and, except for the Intellectual
Property disclosed in the Clause 6.1(m)(i) of Part A of the Target
Disclosure Letter as abandoned, each application within the Target
Intellectual Property is active and pending. Each item of Target
Intellectual Property owned by, purported to be owned by, licensed to or
used by Target immediately prior to the Effective Date will be owned or
available for use by Target on the same terms and conditions immediately
after the Effective Date.
(iii) Clause 6.1(m)(iii) of Part A of the Target Disclosure Letter
contains an accurate and complete list of all Contracts in which Target
is granted rights to any third party Intellectual Property (with the
exception of commercially available off-the-shelf, shrink wrap or click
wrap licences to use Software with a value of less than ($150,000)) or
Target grants a third party rights in the Target Intellectual Property
(the “IP Agreements”). Target has not (a) transferred ownership
of, or entered into any Contract under which it has, or may have, the
obligation to transfer any ownership of, or granted any licence to use
or distribute (or entered into any Contract under which it has, or may
have, the obligation to grant any licence to use or distribute), or
authorised the retention of any rights to use or joint ownership of, any
Target Intellectual Property, to any other Person, (b) permitted the
rights of Target in any such Target Intellectual Property to lapse or
enter the public domain, (c) entered into any Contract under which it
has granted any covenant not to sue, assert or exploit any such Target
Intellectual Property, or (d) entered into any Contract under which it
has granted any Person the right to bring a lawsuit for Infringement of
any such Target Intellectual Property.
(iv) Neither the conduct of the business of Target, nor the use or
practice of any Target Intellectual Property, or making, using, or
selling any Target Products has constituted or does constitute
unauthorised use, misappropriation, infringement or other violation of
the Moral Rights or Intellectual Property rights of any other Person
anywhere in the world (an “Infringement”). To the Knowledge of
Target, there are no third party pending patent applications, which, if
issued, would reasonably be expected to result in a claim of
Infringement. Target has not received any written notice (a) that the
conduct of the business of Target, or use or practice of the Target
Intellectual Property, or making, using or selling Target Products,
constitutes or potentially constitutes an Infringement or (b) of any
pending or threatened Action against Target alleging an Infringement.
(v) There is no Action pending with respect to any item of the Target
Intellectual Property challenging its legality, validity,
enforceability, scope or ownership, and, to the Knowledge of Target, no
circumstances or grounds exist that would give rise to such an Action.
(vi) To the Knowledge of Target, no Person has used, Infringed,
misappropriated, diluted or otherwise violated and no Person is
infringing, violating, misusing or misappropriating any Target
Intellectual Property.
(vii) No current or former directors, officers, employees, consultants,
contractors, agents or other representatives of Target own or has
claimed any rights or interest in (nor to Target’s Knowledge has any of
them made application for) any material Target Intellectual Property.
All current directors, officers, employees, consultants, contractors,
agents or other representatives of Target whose duties or
responsibilities could reasonably be anticipated to result in the
creation of Intellectual Property have entered into agreements assigning
to Target all rights in any Intellectual Property developed within the
scope of such duties and responsibilities. Target has provided Zoetis a
schedule that completely and accurately lists any Target Intellectual
Property which has not yet been assigned to Target.
(viii) Target has used commercially reasonable efforts to preserve and
protect Target Intellectual Property prior to the Effective Date. Target
has used commercially reasonable efforts to preserve the confidentiality
of all Trade Secrets, included in the Target Intellectual Property. All
maintenance, annuity, registration, renewal and other similar fees, and
actions due ninety (90) days after the Effective Date related to the
registered Intellectual Property have been paid or actions have been
completed.
(ix) Clause 6.1(m)(ix) of Part A of the Target Disclosure Letter
contains a complete and accurate list of Software owned by, licensed to
or used by Target, with the exception of commercially available
off-the-shelf, shrink wrap or click wrap licences to use Software with a
value of less than $150,000. This Software is stored and run on
hardware, equipment and networks which are owned by or licensed to
Target on reasonable commercial terms and in compliance with all
applicable Laws. To Target’s Knowledge, such Software does not contain
(a) any undisclosed program routine, device or other feature, including
viruses, worms, bugs, time locks, Trojan horses or back doors, in each
case that is designed to delete, disable, deactivate, interfere with or
otherwise harm such Software or (b) any virus or other intentionally
created, undocumented contaminant that may, or may be used to, access,
modify, delete, damage or disable any hardware, system or data
(collectively “Disabling Code”). Target has taken commercially
reasonable steps, including using current industry standard security
measures and antivirus tools, to protect against Disabling Code; protect
Software, systems and data from misuse, interference and loss, and
protect Software, systems and data from unauthorised access,
modification or disclosure.
(x) All Open Source Software used by Target is set forth in
Clause 6.1(m)(x) of Part A of the Target Disclosure Letter, is fully
segregable and such Open Source Software is independent from Target’s
proprietary Software. Target has not used Open Source Software in any
manner that (a) requires the disclosure or distribution of any source
code of any of Target’s proprietary Software, (b) requires the licensing
of any Intellectual Property for the purpose of making derivative works,
(c) imposes any restriction on the consideration to be charged for the
distribution of any Intellectual Property, (d) creates, or purports to
create, obligations on Target with respect to any Intellectual Property
or grants, or purports to grant, to any third party any rights or
immunities under any Intellectual Property, or (e) imposes any other
material limitation, restriction, or condition on the right of Target to
use or distribute any Intellectual Property. With respect to any Open
Source Software that is or has been used by Target in any way in the
operation of the business, Target has been and is in material compliance
with all applicable licences with respect thereto.
(xi) Target has materially complied with all applicable Laws, as well as
the Target’s own rules, policies and procedures, relating to the
collection, use, storage, disclosure and disposal of personal
information (including health information) collected used, or held for
use by Target in connection with the business of Target (collectively,
the “Data Privacy Rules”). No Action has been (a) asserted or (b)
threatened, in each case in writing, alleging a violation of any Data
Privacy Rules by Target, and, to Target’s Knowledge the consummation of
the Transactions will not breach or otherwise cause any material
violation of any Data Privacy Rules by Target. To Target’s Knowledge,
Target has not suffered any material data security breach in the
twenty-four (24)-month period prior to the date of this Agreement.
(xii) The consummation of the Transaction will not result in the loss or
impairment of, or payment of any additional amounts with respect to, nor
require the consent of any other Person in respect of, any Target’s
rights or obligations under any licensed Target Intellectual Property,
and will not result in invalidity, unenforceability, or impairment of
any Contract related to Target Intellectual Property, and will not
result in invalidity, unenforceability, or impairment of any Target
Intellectual Property.
(xiii) Target possesses, and Zoetis shall obtain as of Effective Date,
documentation relevant to the Trade Secrets that is current, accurate
and sufficient in detail and content to identify and explain it and
allow its full and proper use without relevance on the special knowledge
or memory of others.
(xiv) Target has not disclosed algorithms used or held for use in
connection with research, developments, products and use thereof.
(n) Benefits.
(i) Clause 6.1(n)(i) of Part A of the Target Disclosure Letter sets
forth a correct and complete list of all material Target Benefit Plans.
Target has delivered or made available to Zoetis true, correct and
complete copies of the following documents, with respect to each of the
Target Benefit Plans, to the extent applicable: (i) all plan documents
(or to the extent no plan document exists and is not required by
applicable Law, a written summary of the material plan terms); (ii) all
filings with a Governmental Body; (iii) trust agreements, other funding
arrangements, and the most recent actuarial reports; and (iv) the most
recent summary plan descriptions, plan summaries and other written
communications provided to plan participants.
(ii) The Target Group and Paychex have performed in all material
respects their respective obligations under the agreement between Nexvet
US, Inc. and Paychex dated July 22, 2015 (the “Paychex Agreement”).
There are no circumstances pursuant to which any member of the Target
Group could have any actual or contingent material liability to (i)
Paychex or any of its Affiliates, or (ii) any current or former employee
of any member of the Target Group or their dependents or beneficiaries
with respect to any Paychex Plan. The Target Group’s participation in
each Paychex Plan can be discontinued at any time without material
liability to the Target Group.
(iii) No material suit, actions or other litigation have been brought,
nor to the Knowledge of Target, threatened against or otherwise related
to any Target Benefit Plan, and to the Knowledge of Target, there are no
facts or circumstances that could reasonably to give rise to any such
action, suit, or other litigation.
(iv) Each Target Benefit Plan has been maintained and administered in
compliance with all applicable Laws and all applicable plan terms in all
material respects. All contributions to Target Benefit Plans that have
been required to be made under such Target Benefit Plans have been made,
and all benefits accrued under any unfunded Target Benefit Plan have
been paid, accrued or otherwise adequately reserved in accordance with
US GAAP.
(v) With respect to each Target Benefit Plan maintained in the United
States, (A) each such Target Benefit Plan intended to be “qualified”
within the meaning of Section 401(a) of the Code, (I) is so qualified
and to the Knowledge of Target there are no existing circumstances or
any events that have occurred that would reasonably be expected to
adversely affect the qualified status of any such plan and (II) has
received a favourable determination letter or opinion letter as to its
qualification, which has been provided or made available to Zoetis; and
(B) no such Target Benefit Plan is a “multiemployer plan” (as defined in
Sections 3(37) and 4001(a)(3) of ERISA). Each Target Benefit Plan that
is a “nonqualified deferred compensation plan” (as defined under Section
409A(d)(1) of the Code) has been operated and administered in material
compliance with Section 409A of the Code, to the extent applicable.
Target has not entered into any agreement or arrangement to, and does
not otherwise have any obligation to, indemnify or hold harmless any
Person for any liability that results from the failure to comply with
the requirements of Section 409A of the Code.
(vi) No Target Benefit Plan maintained in the United States is a defined
benefit pension plan (within the meaning of Section 414(j) of the Code).
No entity that would be deemed a single employer with any member of the
Target Group under Section 414(b), (c), (m) or (o) of the Code sponsors,
maintains or contributes to a defined benefit pension plan. No Target
Benefit Plan provides health, accident or death benefit coverage beyond
the termination of employment or other service, except as required by
law.
(vii) No Target Benefit Plan maintained outside of the United States is
a defined benefit scheme (within the meaning given to that term by
Section 2(1) of the Pensions Act 1990 (the “Irish Pensions Act”))
or otherwise in the nature of a defined benefit pension arrangement or
unfunded (partially or fully) deferred compensation arrangement and no
member of the Target Group sponsors, maintains or contributes to any
such scheme or arrangement. Each Target Benefit Plan maintained in
Ireland which is a defined contribution scheme (within the meaning given
to that term by Section 2(1) of the Irish Pensions Act) is exempt
approved by the Irish Revenue Commissioners for the purposes of Section
774 of the Taxes Consolidation Act 1997 and there are no circumstances
which might give the Irish Revenue Commissioners reason to withdraw such
approval. There are no excluded employees in respect of whom a member of
the Target Group is obliged to provide access to a standard personal
retirement saving account in accordance with Section 121 of the Irish
Pensions Act.
(viii) Except as expressly provided in this Agreement, neither the
execution and delivery of this Agreement nor the consummation of the
Transactions (either alone or in conjunction with any other additional
or subsequent event) will (A) result in any payment (including
severance), acceleration, forgiveness of indebtedness, vesting,
distribution, increase in benefits or obligation to fund benefits with
respect to any current, or former employees, officers, consultants,
independent contractors or directors of any member of the Target Group
or (B) result in the triggering or imposition of any restrictions or
limitations on the right of any member of the Target Group to amend or
terminate any Target Benefit Plan. Neither the execution and delivery of
this Agreement nor the consummation of the Transactions (either alone or
in conjunction with any other additional or subsequent event) will
result in the payment of any “excess parachute payments” within the
meaning of Section 280G(b)(1) of the Code. No individual is entitled to
receive any tax gross-up as a result of the imposition of the excise
taxes required by Section 4999 of the Code.
(ix) Each individual who is classified by any member of the Target Group
as an independent contractor has been properly classified for all
purposes.
(o) Labour Matters. As of the date hereof, (a) neither Target nor
any of its Subsidiaries is a party to any collective bargaining
agreement or other agreement with a labour union or like organisation,
(b) to the Knowledge of Target, there are no activities or proceedings
of any labour organisation to organise any employees of Target or any of
its Subsidiaries and no demand for recognition as the exclusive
bargaining representative of any employees has been made by or on behalf
of any labour or like organisation, (c) there is no pending or, to the
Knowledge of Target, threatened labour dispute, strike or work stoppage
against Target or any Subsidiary that may interfere with the business
activities of the Target Group, (d) there is no unfair labour practice
charge against Target or any of its Subsidiaries pending before the
National Labor Relations Board or any comparable labour relations
authority anywhere in the world that would reasonably be expected to
result in any material liability to any member of the Target Group,
taken as a whole, (e) there is no pending or, to the Knowledge of
Target, threatened grievance, charge, complaint, audit or investigation
by or before any Governmental Body with respect to any current or former
employees of Target or any of its Subsidiaries, and (f) in respect of
current and former employees of the Target Group in Australia, each
member of the Target Group has accrued and paid all leave entitlements
in accordance with applicable Laws and has made all superannuation
contributions required under any Industrial Instrument as well as the
minimum level of superannuation contributions to avoid being liable for
a charge under applicable Laws up to the date of this Agreement.
(p) Regulatory Matters.
(i) No member of the Target Group nor, to the Knowledge of Target, any
third-party providing services relating to the Target Products have
received any oral or written notice, communication, Form 483 or other
inspection report, warning letter, untitled letter or notice of
violation, cyber letter, or other notice of enforcement action or other
allegation from any Governmental Body or other person or entity,
including any review authorities, such as an Institutional Animal Care
and Use Committee (“IACUC”), claiming or asserting a violation of
any applicable Laws, or, to the Knowledge of Target, policies,
guidelines or guidance, issued by a Governmental Body or such review
authority applicable to a study concerning a Target Product (“Study”),
the Target Products, such third-party’s services, or Target’s
operations. No such action against any member of the Target Group and,
to the Knowledge of Target, any third-party providing services relating
to the Target Products, is pending, threatened, or under investigation.
Without limiting the foregoing, neither any member of the Target Group,
nor to the Knowledge of Target, any third-party providing services
related to the Target Products or Studies, have received, had
threatened, had asserted, or have pending any warning letters, untitled
letters, cyber letters, notices of violation, regulatory letters,
adverse inspectional findings, FDA Forms 483, or other notice of
enforcement action, including without limitation, any suspension,
consent decree, corporate integrity agreement, monitoring agreement,
assurance of voluntary compliance, settlement order, notice of criminal
investigation, indictment, sentencing memorandum, plea agreement, court
order, target or no-target letter, or other similar agreement or action
relating to a Study, any Target Product, such third-party’s services, or
the operations of any member of the Target Group.
(ii) No member of the Target Group nor, to the Knowledge of Target, any
Target Group officer, director, employee, agent, or third-party
providing services related to the Target Products have been (i) debarred
by the FDA pursuant to 21 U.S.C. § 335a or by any other Governmental
Body pursuant to a similar provision of applicable Law, including
pursuant to 7 C.F.R. Parts 1.1 et seq.; (ii) named, charged, convicted,
or found liable in any action or proceeding relating to the regulation
of animal health products; or (iii) disqualified or deemed ineligible by
the FDA pursuant to 21 C.F.R. Parts 312, 510, 511, 514, 516 or 812, or
by any other Governmental Body pursuant to a similar provision of
applicable Law. No member of the Target Group nor, to the Knowledge of
Target, any Target Group officer, director, employee, agent, or
third-party providing services related to the Target Products (i) are
subject to any pending proceeding or under investigation related to
forgoing, (ii) have been convicted of any crime or engaged in any
conduct that may reasonably lead to the forgoing, or (iii) received any
notice or other communication from a Governmental Body threatening or
pursuing the foregoing.
(iii) Each Target Product is and has been researched, developed, tested,
studied, investigated, manufactured and stored, shipped and labelled, as
applicable, in material compliance with all applicable Laws or, to the
Knowledge of Target, policies, guidelines or guidance. No members of the
Target Group nor, to the Knowledge of the Target Group, any third party
providing services relating to the Target Products, is aware of any
information which would provide a basis for any voluntary or mandated
recall or other corrective action of any Target Product.
(iv) All material filings, notices, permits, licences and other
submissions required to be filed, maintained, or furnished to a
Governmental Body related to the research, development, testing,
manufacturing, distribution or sale of the Target Products have been so
filed, maintained or furnished and were complete and correct in all
material respects on the date filed (or were corrected in or
supplemented by a subsequent filing).
(v) Target has provided Zoetis all material Study reports, protocols,
notebooks, data and other requested materials and all regulatory
communications with and from Governmental Body and review authorities
including but not limited to the FDA and IACUC, concerning the Target
Product, Target Product Studies and Target Product development
(collectively “Study Materials”). The Study Materials provided,
when taken collectively, accurately, fairly and completely in all
material respects reflect the results from and plans for the Studies and
Target Product development. Target has no knowledge of any other
undisclosed material Studies, the results of which are inconsistent
with, or otherwise call into question, the Study Materials. Except as
reflected in the Study Materials, Target is not aware of any facts or
circumstances that would reasonably be expected to materially and
adversely affect the ability of Target or any of its Subsidiaries to
receive or that would otherwise delay the receipt of regulatory approval
for the marketing and commercialisation of the Target Products, beyond
the risks and uncertainties that are generally present for product
candidates subject to approval by a Governmental Body, including the
potential for later study results to differ from preliminary or
earlier-stage results, and for differing interpretations of data. All
Studies concerning the Target Products have and are being conducted in
accordance in all material respects with the applicable protocols, all
applicable Laws, ethical and veterinary standards, and the Governmental
Body and other review authority, including IACUC, requirements. All
Government Authorisations required to conduct the Study have been
obtained and maintained in good standing for the duration of the Study.
(vi) No member of the Target Group nor, to Target’s Knowledge, any
third-party providing services related to the Products has received any
written or other notice or communication from a Governmental Body,
including the FDA and United States Department of Agriculture, or any
review authority, including an IACUC, or other person or entity
responsible for the oversight or conduct of any Study, requiring or
threatening the termination, suspension, material modification,
restriction, delay, hold of, or otherwise rejecting any Study that was,
is planned to be, or is being conducted.
(vii) Target Group and its Subsidiaries have provided full and complete
copies of all information, analysis, data, surveys, interviews, and
other research materials commissioned or possessed by the Target Group
relating to definition and size of markets for Target Products, customer
demographics and preferences, revenue models and projections,
competitive products, market trends and projections and all other
information related to the introduction, marketing, promotion and sale
of Target Products (“Market Research”).
(viii) No member of the Target Group has, and to Target’s Knowledge, no
Target Group officer, director, employee, agent, or third-party
providing services related to the Products, has made an untrue statement
of a material fact or fraudulent or misleading statement to a
Governmental Body, failed to disclose a material fact required to be
disclosed to a Governmental Body, or otherwise committed an act, made a
statement, or failed to make a statement that would reasonably be
expected to provide a basis for the FDA to invoke its policy respecting
“Fraud, Untrue Statements of Material Facts, Bribery, and Illegal
Gratuities” Final Policy set forth in 56 Fed. Reg. 46191 (September 10,
1991) and any amendments thereto (the “FDA Ethics Policy”). No
member of the Target Group nor, to Target’s Knowledge, any Target Group
officer, director, employee, agent, or third-party providing services
related to the Products is or has been under investigation, had any
action pending or threatened relating to the FDA Ethics Policy, or
resulting from any other untrue, fraudulent, misleading, or false
statement or omission, including data fraud.
(q) Real Property.
(i) Clause 6.1(q)(i) of Part A of the Target Disclosure Letter sets
forth a correct and complete list of all real property owned by Target
or any Subsidiary (such property collectively, the “Owned Real
Property”). With respect to the Owned Real Property, either Target
or a Subsidiary of Target has good and valid title to such Owned Real
Property, free and clear of all Encumbrances, other than Permitted
Encumbrances. As of the date hereof, neither Target nor any of its
Subsidiaries has received notice of any pending, and to the Knowledge of
Target there is no threatened, condemnation proceeding with respect to
any Owned Real Property.
(ii) Clause 6.1(q)(ii) of Part A of the Target Disclosure Letter sets
forth a correct and complete list of each material lease, sublease,
licence and other agreement under which Target or any of its
Subsidiaries uses or occupies or has the right to use or occupy any
material real property at which the material operations of Target and
its Subsidiaries are conducted (such property collectively, the “Leased
Real Property”). Each material lease, sublease, licence and other
agreement with respect to such Leased Real Property is valid, binding
and in full force and effect and no uncured default of a material nature
on the part of Target or, if applicable, its Subsidiaries or, to the
Knowledge of Target, the landlord thereunder exists with respect to any
Leased Real Property. Target and each of its Subsidiaries has a good and
valid leasehold interest, subject to the terms of any lease, sublease or
other agreement applicable thereto, in each parcel of Leased Real
Property, free and clear of all Encumbrances, except for Permitted
Encumbrances. As of the date hereof, neither Target nor any of its
Subsidiaries has received notice of any pending, and, to the Knowledge
of Target, there is no threatened, condemnation proceeding with respect
to any Leased Real Property.
(r) Product Distribution. No Person has entered into any Contract
with any member of the Target Group to distribute any Target Products or
has any right or option to distribute any Target Products.
(s) Related Party Transactions. As of the date of this Agreement,
there are no Contracts between Target or any of its Subsidiaries, on the
one hand, and any Affiliate of Target (other than a Subsidiary of
Target), on the other hand, that would be required to be disclosed under
Item 404 of Regulation S-K of the Exchange Act.
(t) Insurance. All current, material insurance policies and
Contracts (or replacements thereof) of Target and its Subsidiaries are
in full force and effect and are valid and enforceable and cover against
the risks as are customary in all material respects for companies of
similar size in the same or similar lines of business and all premiums
due thereunder have been paid. Neither Target nor any of its
Subsidiaries has received notice of cancellation or termination with
respect to any material third party insurance policies or Contracts
(other than in connection with normal renewals of any such insurance
policies or Contracts).
(u) Opinion of Financial Adviser. The Target Board has received
the opinion of Evercore Group L.L.C., dated the date of this Agreement,
to the effect that, as of such date and based upon and subject to the
assumptions and limitations set forth in the opinion, the Consideration
is fair to the Target Shareholders from a financial point of view.
(v) Finders or Brokers. Except for Evercore Group L.L.C. and
Cowen and Company, LLC, neither Target nor any of its Subsidiaries has
employed any investment banker, broker or finder in connection with the
Transactions who might be entitled to any fee or any commission in
connection with or upon consummation of the Acquisition.
(w) Information Provided. The information relating to the members
of the Target Group to be contained in the Scheme Document, the Proxy
Statement and, if applicable, the Takeover Offer Documents (including in
each case any amendments or supplements thereto) and any other documents
filed with the High Court or pursuant to the Takeover Rules, in
connection with this Agreement, will not, on the date the Scheme
Document, the Proxy Statement, or the Takeover Offer Documents, as
applicable, is first posted or disseminated to Target Shareholders and
at the time of the Scheme Meeting and the EGM, contain any untrue
statement of any material fact, or omit to state any material fact
necessary in order to make the statements therein not false or
misleading at the time and in light of the circumstances under which
such statement is made. The Proxy Statement will comply in all material
respects as to form with the requirements of the Exchange Act and with
relevant regulations promulgated thereunder.
(x) No Other Representations. Except for the representations and
warranties contained in this Clause 6.1 or in any certificates delivered
by Target in connection with the Completion, Zoetis acknowledges that
neither Target nor any Representative of Target makes any other express
or implied representation or warranty with respect to Target or any of
its Subsidiaries or with respect to any other information provided or
made available to Zoetis in connection with the Transactions, including
any information, documents, projections, forecasts or other material
made available to Zoetis or to Zoetis’ Representatives in certain “data
rooms” or management presentations in expectation of the Transactions.
6.2 Zoetis Warranties
Except as disclosed in the forms, documents and reports (including
exhibits and other information incorporated therein) filed or furnished
by Zoetis with the SEC since January 1, 2017 and publicly available
prior to the date hereof (but excluding any disclosures in any “risk
factors” section, any disclosures in any “forward-looking statements”
section and any other disclosures included therein to the extent they
are predictive or forward-looking in nature), Zoetis and Zoetis Bidco
represent and warrant to Target as of the date hereof as follows:
(a) Qualification, Organisation, etc. Each of Zoetis and
Zoetis Bidco are legal entities duly organised, validly existing and in
good standing under the Laws of their jurisdictions of organisation and
have all requisite corporate or similar power and authority to own,
lease and operate their properties and assets and to carry on their
business as presently conducted and are qualified to do business and are
in good standing as a foreign corporations in each jurisdiction where
the ownership, leasing or operation of their assets or properties or
conduct of their business requires such qualification.
(b) Corporate Authority Relevant to this Agreement; No Violation.
(i) Each of Zoetis and Zoetis Bidco have all requisite corporate power
and authority to enter into this Agreement and the Expenses
Reimbursement Agreement and to consummate the Transactions in accordance
with the terms of this Agreement and the Expenses Reimbursement
Agreement. The execution and delivery of this Agreement and the Expenses
Reimbursement Agreement and the consummation of the Transactions have
been duly and validly authorised by the Zoetis Board and the board of
directors of Zoetis Bidco and, except for the filing of the required
documents in connection with the Scheme with, and the receipt of the
required approval of the Scheme by, the High Court, no other corporate
proceedings on the part of Zoetis or Zoetis Bidco are necessary to
authorise the consummation of the Transactions. This Agreement has been
duly and validly executed and delivered by Zoetis and Zoetis Bidco and,
assuming this Agreement constitutes the valid and binding agreement of
Target, constitutes the valid and binding agreement of Zoetis and Zoetis
Bidco, enforceable against Zoetis and Zoetis Bidco in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium and other similar laws affecting creditors rights
generally and by general principles of equity.
(ii) Other than in connection with or in compliance with (i) the
provisions of the Act, (ii) the Takeover Panel Act and the Takeover
Rules, (iii) the Securities Act, (iv) the Exchange Act, and (v) any
applicable requirements of the NYSE, no authorisation, consent or
approval of, or filing with, any Governmental Body is necessary, under
applicable Law, for the consummation by Zoetis and Zoetis Bidco of the
Transactions, except for such authorisations, consents, approvals or
filings (A) that, if not obtained or made, would not reasonably be
expected to materially impede or prevent the consummation of the
Acquisition or have a material adverse effect on Zoetis or Zoetis Bidco,
or (B) as may arise as a result of facts or circumstances solely
relating to Target or its Affiliates or Laws or Contracts binding on
Target or its Affiliates.
(iii) Assuming compliance with the Scheme, Chapter 1 of Part 9 of the
Act and any directions or orders of the High Court, none of the
execution, delivery or performance of this Agreement or the consummation
of the Transactions, including the Acquisition, will: (i) contravene,
conflict with or result in a violation of any of the provisions of the
Zoetis or Zoetis Bidco’s articles of association or other Organisational
Documents; (ii) contravene or conflict with, or result in a violation
of, any applicable Law or any order, ruling, writ, injunction, judgment,
arbitration award or decree to which Zoetis or Zoetis Bidco, or any of
their material assets are subject; (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 alter the rights or obligations
of any third party under, or give to others any rights of termination,
amendment, acceleration or cancellation, or require any Clearances
under, any material Contract to which Zoetis or any of its Subsidiaries
is a party or otherwise bound as of the date hereof; or (iv) result in
the creation of an Encumbrance (other than Permitted Encumbrances) on
any of the properties or assets of Zoetis or any of its Subsidiaries,
except, in the case of each of clauses (ii), (iii) and (iv), for any
conflicts, violations, breaches, defaults, alterations, terminations,
amendments, accelerations, cancellations or liens, or where the failure
to obtain any consents, in each case, would not reasonably be expected
to have, individually or in the aggregate, a material adverse effect on
Zoetis.
(iv) No approval of the stockholders of Zoetis or Zoetis Bidco is
required to consummate the Transactions.
(c) Financial Capability. Zoetis and/or Zoetis Bidco have or will
have at the Completion and prior to the Effective Time, sufficient funds
to pay the aggregate Consideration contemplated by this Agreement and to
perform the other obligations of Zoetis and Zoetis Bidco contemplated by
this Agreement.
(d) Legal Proceedings. As of the date hereof, there is no pending
or, to the Knowledge of Zoetis and Zoetis Bidco, threatened, legal
action against Zoetis or any of its Subsidiaries, nor is there any
injunction, order, judgment, ruling or decree imposed upon Zoetis or any
of its Subsidiaries, in each case, by or before any Governmental Entity,
that would, individually or in the aggregate, reasonably be expected to
have a material adverse effect on Zoetis’ or Zoetis Bidco's ability to
consummate the Transactions.
(e) Information Provided. The information relating to Zoetis and
its Subsidiaries to be contained in the Scheme Document, the Proxy
Statement and, if applicable, the Takeover Offer Documents (including in
each case any amendments or supplements thereto) and any other documents
filed with the High Court, the SEC or pursuant to the Takeover Rules, in
connection with this Agreement to the extent provided by Zoetis in
writing and reproduced therein, will not, on the date the Scheme
Document, the Proxy Statement, the Takeover Offer Documents or such
other documents, as applicable, are first posted or disseminated to
Target Shareholders, contain any untrue statement of any material fact,
or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not false or
misleading at the time and in light of the circumstances under which
such statement is made.
(f) Ownership of Target Ordinary Share Capital. Neither Zoetis,
Zoetis Bidco nor any of their Affiliates beneficially owns (as defined
in Rule 13d-3 of the Exchange Act) any shares of Target’s ordinary share
capital.
(g) Acting in Concert. As of the date hereof, none of Zoetis,
Zoetis Bidco or any of their respective controlled Concert Parties has
any interest in any Target Shares. In entering into this Agreement,
Zoetis and Zoetis Bidco are each acting as principal only and not Acting
in Concert with any other person (other than their Representatives) for
the purposes of acquiring control of Target or any of its material
assets.
(h) Finders or Brokers. Other than Goldman, Sachs & Co., neither
Zoetis nor any of its Subsidiaries has employed any investment banker,
broker or finder in connection with the Transactions who might be
entitled to any fee or any commission in connection with or upon
consummation of the Acquisition.
7. Additional Agreements
7.1 Consents and Regulatory Approvals
(a) The terms of the Acquisition at the date of publication of the
Scheme Document shall be set out in the Rule 2.5 Announcement and the
Scheme Document, to the extent required by applicable Law.
(b) Subject to the terms and conditions hereof, the Parties shall use
all reasonable endeavours to achieve satisfaction of the Conditions as
promptly as is reasonably practicable following the publication of the
Scheme Document and in any event no later than the End Date.
(c) Subject to the terms and conditions hereof, Target and Zoetis shall,
and Zoetis shall cause Zoetis Bidco to, use all reasonable endeavours to:
(i) take, or cause to be taken, all actions, and do, or cause to be
done, and to assist and cooperate with the other Party in doing, all
things necessary, proper or advisable to consummate and make effective
the Transactions as promptly as is practicable;
(ii) as promptly as is reasonably practicable, obtain from, make with or
provide to any Governmental Body any Clearances required to be obtained,
made or provided by Target or Zoetis or any of their respective
Subsidiaries in connection with the consummation of the Transactions;
(iii) to the extent that any Clearance required to be made under an
applicable Law or by a Governmental Body is not required until after the
consummation of the Transaction, Target shall, in advance of such
consummation, provide Zoetis with all information and assistance as may
reasonably be requested by Zoetis to enable Zoetis to obtain any such
Clearance;
(iv) as promptly as is reasonably practicable, make all filings, and
thereafter make any other required or appropriate submissions, that are
required or reasonably necessary to consummate the Transactions,
including:
(A) under any foreign investment Laws;
(B) under the Takeover Rules and the Act;
(C) under the Exchange Act or the Securities Act; or
(D) as required by the High Court; and
(v) as promptly as is reasonably practicable, take reasonable actions to
obtain from, make with or provide to any third party any Clearances
required to be obtained, made or provided by Target or Zoetis or any of
their respective Subsidiaries in connection with the consummation of the
Transactions; provided, however,
that notwithstanding anything in this Agreement to the contrary, in no
event shall Target or Zoetis or any of their respective Subsidiaries be
required to pay, prior to the Effective Time, any fee, penalty or other
consideration to any third party (other than a Governmental Body) for
any Clearance required in connection with the consummation of the
Transactions under any Contract.
7.2 Directors’ and Officers’ Indemnification and Insurance
(a) Zoetis agrees that all rights to exculpation, indemnification or
advancement of expenses arising from, relating to, or otherwise in
respect of, acts or omissions occurring at or prior to the Effective
Time now existing in favour of the current or former directors or
officers of Target or its Subsidiaries (the “Indemnified Parties”)
as provided in their respective Organisational Documents or any
indemnification or similar agreements shall survive the Acquisition and
shall continue in full force and effect in accordance with their terms.
For a period of no less than six (6) years from the Effective Time,
Zoetis shall cause Target to maintain in effect the exculpation,
indemnification and advancement of expenses provisions of Target’s and
its Subsidiaries’ Organisational Documents or any indemnification or
similar agreements, in the form that is in effect as of the date of this
Agreement, and shall not, and shall cause Target not to, amend, repeal
or otherwise modify any such provisions in any manner that would
adversely affect the rights thereunder of any individuals who
immediately before the Effective Time were current or former directors,
officers or employees of Target; provided, however,
that all rights to exculpation, indemnification and advancement of
expenses in respect of any Action pending or asserted or any claim made
within such period shall continue until the final disposition of such
Action. Target has not entered into any indemnification or similar
arrangements in favour of the Indemnified Parties within the 30 days
preceding the date of this Agreement.
(b) During the period commencing at the Effective Time and ending on the
sixth (6th) anniversary of the Effective Time, to the maximum extent
permitted by law, Zoetis shall, and shall cause Target to, indemnify and
hold harmless, and advance expenses to, the Indemnified Parties against
any costs or expenses (including reasonable attorneys’ fees), judgments,
fines, losses, claims, damages or liabilities in connection with any
actual or threatened Action arising out of, relating to or in connection
with (i) the fact that such Indemnified Party is or was a director or
officer of Target or any of its Subsidiaries, (ii) any acts or omissions
occurring or alleged to occur prior to or at the Effective Time in such
Indemnified Party’s capacity as a director, officer, employee or agent
of Target or any of its Subsidiaries, or (iii) the Acquisition, this
Agreement or the transactions contemplated hereby; provided,
however, that if, at any time prior to the
sixth (6th) anniversary of the Effective Time, any such Indemnified
Party delivers to Zoetis or Target a written notice asserting a claim
for indemnification or advancement under this Clause 7.2(b) then the
claim asserted in such notice shall survive the sixth (6th) anniversary
of the Effective Time until such time as such claim is fully and finally
resolved.
(c) Prior to the Effective Time, Target shall obtain and fully pay for
“tail” insurance policies with a claims period of no more than six (6)
years from and after the Effective Time from an insurance carrier with
the same or better credit rating as Target’s current insurance carrier
with respect to directors’ and officers’ liability insurance and
fiduciary liability insurance with benefits and levels of coverage not
materially more favourable than Target’s existing policies (the “Existing
Policies”) with respect to matters existing or occurring at or
prior to the Effective Time (including with respect to acts and
omissions occurring in connection with this Agreement, the Acquisition
or the other transactions or actions contemplated hereby) and, if such
policies have been obtained, Zoetis shall, and shall cause Target to,
maintain such policies in full force and effect after the Effective
Time; provided, however,
that in no event shall Target pay, or be required to pay, for such
“tail” policies a one-time premium in excess of 250% of Target’s current
aggregate annual premium amount under its Existing Policies. If Target
for any reason fails to obtain such tail policy, Target shall, and
Zoetis shall cause Target to, maintain in effect for not less than six
(6) years from the Effective Time the Existing Policies for the
Indemnified Parties otherwise covered by such Existing Policies; provided
that (i) Target may substitute therefor policies of substantially the
same coverage containing terms and conditions that are no less
advantageous to such Indemnified Parties and are from an insurance
carrier with the same or better credit rating as Target’s current
insurance carrier; and (ii) Target shall not be required to pay annual
premiums for the Existing Policies (or for any substitute policies) in
excess of 250% of the annual premiums paid for the Existing Policies
prior to the date of this Agreement (the “Maximum Premium”).
In the event any future annual premiums for the Existing Policies (or
any substitute policies) exceed such amount, the Surviving Entity shall
be entitled to reduce the amount of coverage of the Existing Policies
(or any substitute policies) to the maximum amount of coverage that can
be obtained for a premium equal to such amount.
7.3 Employment and Benefit Matters
(a) For a period of one year following the Effective Date, Zoetis shall
provide, or shall cause to be provided, to each Target Employee,
following any consultation processes which are required by Law and or
pursuant to existing contractual obligations:
(i) base salary or wage rate that is no less favourable than the base
salary or wage rate, as applicable, provided to such Target Employee
immediately prior to the Effective Time;
(ii) for Australian and Irish Target Employees, superannuation or
pension payments (as applicable), that are no less favourable in the
aggregate to the payments included in any total fixed remuneration
provided to such Target Employee immediately prior to the Effective Time;
(iii) cash bonus opportunities no less favourable in the aggregate than
those provided to such Target Employee immediately prior to the
Effective Time;
(iv) equity compensation opportunities under the equity compensation
plans of Zoetis or its Affiliates as may be determined by Zoetis (in its
sole discretion), with such determination as to which Target Employees
may be offered such an opportunity and the amount and terms and
conditions of such opportunity to be made by Zoetis on an individual
basis in a manner that is consistent with Zoetis’ determination with
respect to its similarly situated employees;
(v) employee benefits (excluding any cash incentive compensation, equity
or equity-based compensation, defined benefit pension benefits, and
post-employment health and welfare benefits) that, in the aggregate and
when taken as a whole, are substantially comparable to those provided to
the Target Employees immediately prior to the Effective Time; and
(vi) severance benefits that are no less favourable than the severance
benefits that would have been applicable immediately prior to the
Effective Time to each Target Employee in accordance with the severance
formula set forth in Schedule 2.
(b) For the purposes of eligibility, vesting and determining the
applicable level of vacation and other paid time off benefits (but not
for purposes of any other benefit accrual), under the employee benefit
plans pursuant to which Zoetis provides benefits to any Target Employee
after the Effective Time (the “New Plans”), which shall exclude,
for the avoidance of doubt, any benefits provided by, in whole or in
part, a Governmental Body and workers’ compensation insurance, each
Target Employee shall be credited with his or her years of service with
the Target Group and its predecessors before the Effective Date, to the
same extent as such Target Employee was entitled, before the Effective
Time, to credit for such service under any similar Target Benefit Plan
in which such Target Employee participated; provided,
however, that the foregoing shall not apply
to any cash incentive, equity or equity based plans or awards or to the
extent that its application would result in a duplication of benefits
with respect to the same period of service.
(c) In addition, and without limiting the generality of the foregoing:
for the purposes of each New Plan providing disability, medical, dental,
pharmaceutical and/or vision benefits to any Target Employee, Zoetis
shall use all reasonable endeavours to cause: (i) all pre-existing
condition exclusions and actively-at-work requirements of such New Plan
to be waived for such employee and his or her covered dependents, unless
and to the extent the individual was subject to such conditions under
the comparable Old Plans; and (ii) any co-payments and deductibles paid
by such employee and his or her covered dependents during the portion of
the plan year of the Old Plan ending on the date such employee’s
participation in the corresponding New Plan begins to be taken into
account under such New Plan for the purposes of satisfying all
deductible, coinsurance and maximum out-of-pocket requirements
applicable to such employee and his or her covered dependents for the
applicable plan year as if such amounts had been paid in accordance with
such New Plan.
(d) Where Zoetis maintains any of the Old Plans in full force and
effect, the provisions of Clause 7.3(b) shall not apply with respect to
the benefits available under such Old Plans unless and until Zoetis
replaces such Old Plans with New Plans. Nothing in this Agreement shall
require Zoetis to replace the Old Plans with New Plans.
(e) Nothing in this Agreement shall confer upon any Target Employee or
any other individual any right to continue in the employment or service
of any member of the Target Group, Zoetis or any Affiliate of Zoetis, or
shall interfere with or restrict in any way the rights of any member of
the Target Group, Zoetis or any Affiliate of Zoetis, which rights are
hereby expressly reserved, to discharge or terminate the services of any
Target Employee or other individual at any time for any reason
whatsoever, with or without cause. This Clause 7.3 is included for the
sole benefit of the Parties to this Agreement. Notwithstanding any
provision in this Agreement to the contrary, nothing in this Clause 7.3,
express or implied, shall be deemed or construed (A) to prevent Zoetis
from terminating or modifying to any extent or in any respect any
Benefit Plan, (B) to be an amendment or other modification of any Target
Benefit Plan or Benefit Plan of Zoetis, or (C) to create or confer any
rights or remedies upon any current or former employee or other service
provider of Zoetis, Target or any of their respective Affiliates (or any
beneficiaries, dependents, or legal representatives thereof).
(f) If requested by Zoetis, Target shall: (i) effective as of or prior
to the Effective Time, cause the Target Group to terminate all qualified
retirement plans with a 401(k) deferral feature, including the Nexvet
US, Inc. 401(k) Profit Sharing Plan and Trust (all such plans, the “Target
401(k) Plans”); (ii) provide evidence reasonably satisfactory to
Zoetis of such termination prior to the Effective Time; (iii) in
connection with such termination, cause all of the account balances of
the participants to become fully vested and non-forfeitable; (iv) cause
the Target Group to make all necessary contributions as specified in the
Target 401(k) Plans to the Target 401(k) Plans related to services
performed prior to such termination; and (v) take any other action, or
cause the Target Group to take any other action, required for such
termination of the Company 401(k) Plans to be effective on or prior to
the Effective Time.
(g) If requested by Zoetis no less than thirty-five (35) days prior to
the Effective Time, Target shall terminate the Paychex Agreement and
participation in all Paychex Plans effective immediately prior to the
Effective Time.
7.4 Cooperation
(a) Upon reasonable notice and subject to applicable Laws relating to
the exchange of information, Target shall afford to Zoetis and its
Affiliates and its and their Representatives, during normal business
hours during the period prior to the Effective Time, reasonable access
(including for the purpose of coordinating transition planning with
employees) to all Target’s and its Subsidiaries’ properties, books,
Contracts, commitments and records, and to Target’s and its
Subsidiaries’ officers, employees, accountants, counsel and other
Representatives and, during such period, Target shall promptly make
available to Zoetis and its Representatives, subject, in the case of
competitively sensitive information, to any “clean-room” arrangements
agreed between the Parties, (i) a copy of each report, schedule,
registration statement and other document filed or received by Target or
any of its Subsidiaries during such period pursuant to the requirements
of federal securities Laws and (ii) all other information concerning its
business, properties and personnel as Zoetis may reasonably request.
(b) This Clause 7.4 shall not require Target to permit any access, or to
disclose any information, that in the reasonable, good faith judgment of
Target is competitively sensitive, would reasonably be expected to
result in any violation of any material Contract or Law to which Target
or any of its Subsidiaries is a party or is subject or cause any
privilege (including attorney-client privilege) which Target or any of
its Subsidiaries would be entitled to assert to be undermined with
respect to such information and such undermining of such privilege could
in Target’s good faith judgment adversely affect in any material respect
Target’s or any of its Subsidiary’s position in any pending or
reasonably probable future litigation; provided,
that the Parties shall cooperate in seeking to find a way to allow
disclosure of such information to the extent doing so (1) would not (in
the good faith belief of Target) reasonably be likely to result in the
violation of any such material Contract or Law or reasonably be likely
to cause such privilege to be undermined with respect to such
information or (2) could reasonably (in the good faith belief of Target)
be managed through the use of any “clean-room” arrangements agreed
between the Parties pursuant to which non-employee Representatives of
Zoetis shall be provided access to such information; provided,
further, that Target shall (x) notify
Zoetis that such disclosures are reasonably likely to violate the
obligations of any member of the Target Group under any such material
Contract or Law or are reasonably likely to cause such privilege to be
undermined and (y) in the case where such disclosures are reasonably
likely to violate Target’s or any of its Subsidiaries’ obligations under
any material Contract, use reasonable commercial efforts to seek consent
from the applicable third Person to any such material Contract with
respect to the disclosures prohibited thereby (to the extent not
otherwise expressly prohibited by the terms of such Contract).
(c) To the extent applicable, Target shall use all reasonable endeavours
to assist in the delivery to Zoetis of customary payoff letters, lien
terminations and instruments of discharge in form and substance
reasonably satisfactory to Zoetis to allow for the payoff, discharge and
termination in full of any Indebtedness.
(d) Notwithstanding anything to the contrary in the foregoing, nothing
in this Clause 7.4 shall require any member of the Target Group to take
any action that would violate Section 82 of the Act.
7.5 Transaction Challenges
(a) Target shall consult and cooperate with Zoetis in Target’s defence
or settlement of any actual or threatened shareholder litigation (other
than any litigation or settlement between Target or any of its
Affiliates and Zoetis or any of its respective Affiliates) against
Target or its directors or officers, and any actual or threatened
complaints or challenges that may be brought in the High Court or any
other court in Ireland or any court in the United States or Australia in
connection with the Scheme, the Proxy Statement, the Transactions, this
Agreement or the Expenses Reimbursement Agreement.
(b) Zoetis shall consult and cooperate with Target in Zoetis’ defence or
settlement of any actual or threatened shareholder litigation (other
than any litigation or settlement between Zoetis or any of its
respective Affiliates and Target and any of its Affiliates) against
Zoetis or Zoetis Bidco or their directors or officers, and any actual or
threatened complaints or challenges that may be brought in the High
Court or any other court in Ireland or in any court in the United States
or Australia in connection with the Scheme, the Proxy Statement, the
Transactions, this Agreement or the Expenses Reimbursement Agreement.
7.6 Notification of Certain Matters
(a) Zoetis and Target shall each give prompt notice to the other Party
if any of the following occur after the date of this Agreement: (i)
receipt of any written notice to the receiving Party from any third
Person alleging that the consent or approval of such third Person is or
may be required in connection with the Acquisition and the other
Transactions and such consent could (in the good faith determination of
such Party) reasonably be expected to (A) prevent or materially delay
the consummation of the Transactions or (B) be material to Zoetis or
Target; (ii) receipt of any notice or other communication from any
Governmental Body in connection with the Acquisition and the other
Transactions; or (iii) the occurrence of an event which would or would
be reasonably likely to (A) prevent or materially delay the Transactions
or (B) result in the failure of any condition to the Acquisition set
forth in this Agreement to be satisfied; provided,
however, that the delivery of any notice
pursuant to this Clause 7.6(a) shall not limit or otherwise affect the
remedies of Target or Zoetis available hereunder and no information
delivered pursuant to this Clause 7.6(a) shall update any section of the
Target Disclosure Letter or shall affect the representations or
warranties of the Parties hereunder.
(b) Target shall promptly, but no later than twenty four (24) hours
of the receipt of notice of, or becoming aware of, the occurrence of any
matter described in Clause 7.6(b)(i)-(iii), notify Zoetis of:
(i) Any results of any Study, or other information that becomes known
to Target, including Adverse Events or other unfavourable safety,
quality or efficacy information, that would reasonably be expected to
materially adversely impact the Target Products, the Target Product
development, or the potential Governmental Authorisation for a Target
Product to allow Target to manufacture, study, commercially market,
promote, and sell such Target Product;
(ii) Any material communication, correspondence, or
interaction (as defined below) with a Governmental Body or other review
authority, including the European Medicines Agency, the FDA, the United
States Department of Agriculture, the Health Products Regulatory
Authority, the Irish Department of Agriculture, Food and the Marine or
an IACUC pertaining to the Transactions, Target’s business, Target
Products, Studies, or Target Product-related services being provided by
a third-party. For purposes of this Clause, “material
communication, correspondence, or interaction” means any oral or written
communication concerning inspections, audits, meetings, material
comments on any Target proposed, pending, in-process, or completed
Studies; any requirement to terminate, materially modify, or otherwise
suspend or place a Study on hold; any material manufacturing issues with
regard to the Target Products; or any notices or other assertions of
noncompliance, such as warning letters, untitled letters, cyber letters,
notices of violation, regulatory letters, adverse inspectional findings,
FDA Forms 483, or other notice of enforcement action, including without
limitation, any suspension, consent decree, corporate integrity
agreement, monitoring agreement, assurance of voluntary compliance,
settlement order, notice of criminal investigation, indictment,
sentencing memorandum, plea agreement, court order, target or no-target
letter, or other similar agreement or action relating to a Study, Target
Product, such third-party’s services, the Transactions, or Target’s
business; as well as any notice of the pendency, investigation, or
threat of the foregoing. In the case of a meeting, inspection, or
audit occurring after the date of this Agreement, Target shall, to the
extent permitted by the Governmental Body or review authority, provide
Zoetis with the opportunity to assist with the preparation for and to
attend and participate in such meeting, inspection, or audit. In
all other circumstances, prior to submitting or engaging in a
communication, correspondence or interaction (whether written or oral)
with a Governmental Body or review authority that would reasonably be
material to Target’s business, Target Products, Studies, or Target
Product-related services being provided by a third-party, Target shall
provide Zoetis with the reasonable opportunity to review and comment on
the proposed communication, correspondence, or interaction and will
consider incorporation of such comments in good faith; or
(iii) Any reportable environmental, health or safety incident
or issue at any facility owned, leased or operated by Target.
(c) Target shall provide Zoetis with all reasonably requested
information and documentation concerning Target’s business, Target
Products, Studies, or Target Product-related services being provided by
a third-party.
8. Completion of Acquisition
8.1 Completion Date
(a) Completion shall take place at 10:00 a.m., on a date to be agreed by
the Parties, being not more than three Business Days (or such shorter
period of time as remains before 11:59 p.m., on the End Date) after the
satisfaction or, in the sole discretion of the applicable Party, waiver
(where permissible pursuant to the provisions of the Rule 2.5
Announcement and/or the Scheme Document) of all of the Conditions with
the exception of Condition 2(d) (delivery and registration of the Court
Order and a copy of the minute required by Section 86 of the Act) (but
subject to the satisfaction of such Condition) (the “Completion Date”).
(b) Completion shall take place at the offices of Arthur Cox, Dublin.
8.2 Actions on or prior to Completion
On or prior to Completion, Target shall procure that a meeting of the
Target Board (or a duly authorised committee thereof) is held at which
resolutions are passed (conditional on registration of the Court Order
with the Registrar of Companies occurring and effective as of the
Effective Time) approving:
(a) the allotment and issue to Zoetis and/or Zoetis Bidco (and/or their
nominees) in accordance with the Scheme of the number of new shares in
the capital of Target provided for in the Scheme;
(b) the removal of such directors of Target or any other member of the
target Group as Zoetis shall (in its sole discretion) determine; and
(c) the appointment of such persons as Zoetis may nominate as the
directors of Target or any member of the Target Group.
8.3 Action on Completion
(a) On Completion, Target shall deliver to Zoetis:
(i) a certified copy of the resolutions of the Target Board referred to
in Clause 8.2;
(ii) letters of resignation from the directors that are removed from
Target in accordance with Clause 8.2(b) (each such letter containing an
acknowledgement that such resignation is without any claim or right of
action of any nature whatsoever outstanding against Target or any member
of the Target Group or any of their officers or employees for breach of
contract, compensation for loss of office, redundancy or unfair
dismissal or on any other grounds whatsoever in respect of the removal);
and
(iii) a copy of the register of members certified by the registrar of
Target, together with a share certificate in respect of the aggregate
number of shares in the capital of Target to be issued to Zoetis and/or
Zoetis Bidco (and/or its nominees) in accordance with the Scheme.
8.4 Target shall cause a copy of the Court Order and a copy of the
minutes required by Section 86 of the Act to be filed with the Companies
Registration Office and obtain from the Registrar of Companies a
Certificate of Registration in relation to the reduction of share
capital involved in the Scheme.
8.5 Payment of Consideration
Zoetis shall cause Zoetis Bidco to pay the Consideration and the Rule 15
Consideration within 14 days following the Effective Date in accordance
with the terms and conditions of the Scheme, which includes paying the
Consideration due to each Target Shareholder in respect of each Target
Share held and the Rule 15 Consideration due each holder of Target
Convertible Securities in respect of each Target Share issuable upon
exercise, conversion of exchange thereof.
9. Termination
9.1 (a) This Agreement may be terminated at any time prior to the
Effective Time:
(i) by either Target or Zoetis if the Scheme Meeting or the EGM shall
have been completed and the Scheme Meeting Resolution or the EGM
Resolutions, as applicable, shall not have been approved by the
requisite majorities;
(ii) by either Target or Zoetis if the Effective Time shall not have
occurred by 5:00 p.m. on the End Date, provided that the right to
terminate this Agreement pursuant to this Clause 9.1(a)(ii) shall not be
available to a Party whose breach of any provision of this Agreement
shall have been the primary cause of the failure of the Effective Time
to have occurred by such time;
(iii) by either Target or Zoetis if the High Court declines or refuses
to sanction the Scheme unless the decision of the High Court shall be
appealed (it being agreed that Target shall make such an appeal if
requested to do so by Zoetis and the counsel appointed by Zoetis in
accordance with Clause 3.3(a) advises that doing so is a reasonable
course of action);
(iv) by either Target or Zoetis if an injunction shall have been entered
permanently restraining, enjoining or otherwise prohibiting the
consummation of the Acquisition and such injunction shall have become
final and non-appealable (provided that the right to terminate this
Agreement pursuant to this Clause 9.1(a)(iv) shall not be available to a
Party whose breach of any provision of this Agreement shall have been
the primary cause of such injunction);
(v) by Target, if any Zoetis Party shall have breached or failed to
perform in any material respect any of its covenants or other agreements
contained in this Agreement or any of its warranties set forth in this
Agreement having been inaccurate, which material breach, failure to
perform or inaccuracy:
(A) would result in a failure of any Conditions; and
(B) is not reasonably capable of being cured by the End Date or, if
curable, is not cured within 30 days following Target’s delivery of
written notice to Zoetis of such breach, failure to perform or
inaccuracy (which notice shall state Target’s intention to terminate
this Agreement pursuant to this Clause 9.1(a)(v) and the basis for such
termination);
(vi) by Zoetis, if Target shall have breached or failed to perform in
any material respect any of covenants or other agreements contained in
this Agreement or any of its warranties set forth in this Agreement
having been inaccurate , which material breach, failure to perform or
inaccuracy:
(A) would result in a failure of any Conditions; and
(B) is not reasonably capable of being cured by the End Date or, if
curable, is not cured within 30 days following Zoetis’ delivery of
written notice to Target of such breach, failure to perform or
inaccuracy (which notice shall state Zoetis’ intention to terminate this
Agreement pursuant to this Clause 9.1(a)(vi) and the basis for such
termination);
(vii) by Zoetis, in the event that a Target Change of Recommendation
shall have occurred or the Target Board or any Committee thereof
withdraws (or modifies in any manner adverse to Zoetis) or proposes
publicly to withdraw (or modify in any manner adverse to Zoetis) the
Scheme Recommendation;
(viii) by Target upon written notice at any time following delivery of a
Final Recommendation Change Notice pursuant to and in accordance with
Clause 5.2(e); or
(ix) by mutual written consent of Target and Zoetis.
(b) Termination of this Agreement in accordance with Clause 9.1 shall
not give rise to any liability of the Parties except as provided in the
Expenses Reimbursement Agreement, and, following such termination, no
Party shall have any liability to the other Parties in connection with
this Agreement or the Transactions, except as provided in the Expenses
Reimbursement Agreement; provided that such termination shall not
relieve any Party from liability for fraud or wilful breach of, or
failure to perform, this Agreement. Clause 10 (other than Clauses 10.1
and 10.11) shall survive, and continue in full force and effect,
notwithstanding the termination of this Agreement. If Zoetis or Zoetis
Bidco brings a successful action against Target for liability for wilful
breach of, or failure to perform, this Agreement, then all amounts (if
any) paid by Target to Zoetis or Zoetis Bidco under Clause 3.3(a) of the
Expenses Reimbursement Agreement which are included in any award made by
a court of competent jurisdiction against Target arising from liability
for wilful breach of, or failure to perform, this Agreement shall be
credited against the amount of such award.
(c) Each Party understands and confirms that termination of this
Agreement shall:
(i) be without prejudice to the provisions of the Expenses Reimbursement
Agreement or the Zoetis Confidentiality Agreement; and
(ii) not affect the obligations of each Party to pay the costs and
expenses provided in Clause 10.12.
10. General
10.1 Announcements
(a) Subject to the requirements of applicable Law, the Takeover Rules, a
court order, the Securities Act, the Exchange Act, the SEC or any
Governmental Body (including the Panel), the Parties shall consult
together as to the terms of, the timing of and the manner of publication
of any formal public announcement which either Party may make primarily
regarding the Transactions, the Scheme or this Agreement. Zoetis and
Target shall give each other a reasonable opportunity to review and
comment upon any such public announcement and shall not issue any such
public announcement prior to such consultation, except as may be
required by applicable Law, the Takeover Rules, a court order, the
Securities Act, the Exchange Act, the SEC, NASDAQ, NYSE or any
Governmental Body (including the Panel). The Parties agree that the
initial press release to be issued with respect to the Transactions
shall be in the form of the Rule 2.5 Announcement or as otherwise agreed
by the Parties.
(b) For the avoidance of doubt, the provisions of Clause 10.1(a) do not
apply to any announcement, document or publication in connection with a
Target Alternative Proposal or Target Superior Proposal or a change in
the Scheme Recommendation, provided that Target shall have provided an
advance copy of any such proposed announcement to Zoetis before release,
or any amendment to the terms of the Scheme proposed by Zoetis that
would effect an increase in the Consideration whether before or after a
withdrawal or adverse modification of the Scheme Recommendation.
10.2 Notices
(a) Any notice or other document to be served under this Agreement may
be delivered by overnight delivery service (with proof of service), by
email or hand delivery to the Party to be served as follows:
(i) if to Zoetis or Zoetis Bidco, to:
Zoetis Inc.
10 Sylvan Way, Parsippany, NJ 07054, U.S.A.
Attention: General Counsel
Email: LegalNotices@zoetis.com
with copy to:
Morgan, Lewis & Bockius LLP
101 Park Avenue
New York, NY 10178-0060, U.S.A
Attention: Eric Tajcher
Email: eric.tajcher@morganlewis.com
and
Arthur Cox
Ten Earlsfort Terrace
Dublin, DO2 T380
Attention: Christopher McLaughlin, John Barrett
Email: Christopher.McLaughlin@arthurcox.com
John.Barrett@arthurcox.com
(ii) if to Target, to:
Target
Unit 5, Sragh Technology Park
Tullamore, Co. Offaly, Ireland
Attention: Chief Executive Officer
Email: company.secretary@nexvet.com
with copy to:
DLA Piper LLP (US)
2000 University Avenue
East Palo Alto, California, 94303-2214, U.S.A.
Attention: Bruce Jenett, Andrew Ledbetter
Email: Bruce.Jenett@dlapiper.com,
Andrew.Ledbetter@dlapiper.com
and
Matheson
70 Sir John Rogerson’s Quay
Dublin 2
Attention: Tim Scanlon and Madeline McDonnell
Email: Tim.Scanlon@matheson.com
Madeline.McDonnell@matheson.com
or such other postal address or email address as it may have notified to
the other Party in writing in accordance with the provisions of this
Clause 10.2.
(b) Any notice or document shall be deemed to have been served:
(i) if delivered by overnight delivery or by hand, at the time of
delivery; or
(ii) if sent by e-mail, at the time of the sending of the e-mail
(provided that any notice deemed to have been served on any day that is
not a Business Day, or on any Business Day after 5:30 p.m. (addressee’s
local time), shall be deemed to have been served at 9:00 a.m.
(addressee’s local time) on the next Business Day).
10.3 Assignment
Neither Party shall assign all or any part of the benefit of, or rights
or benefits under, this Agreement without the prior written consent of
the other Party, provided that Zoetis may assign any or all of its
rights and interests hereunder to one or more of its Subsidiaries,
provided that prior consent in writing has been obtained from the Panel
if required in respect of such assignment, but no such assignment shall
relieve Zoetis of its obligations hereunder.
10.4 Counterparts
This Agreement may be executed in any number of counterparts, all of
which, taken together, shall constitute one and the same agreement, and
each Party may enter into this Agreement by executing a counterpart and
delivering it to the other Party (by hand delivery, e-mail or otherwise).
10.5 Amendment
No amendment of this Agreement shall be binding unless the same shall be
evidenced in writing duly executed by each of the Parties, except that
following obtainment of the Target Shareholder Approval there shall be
no amendment to the provisions hereof which by Law requires further
approval by the Target Shareholders without such further approval nor
shall there be any amendment or change not permitted under applicable
Law.
10.6 Entire Agreement
This Agreement, together with the Zoetis Confidentiality Agreement, the
Expenses Reimbursement Agreement and any documents delivered by the
Zoetis Parties and Target in connection herewith, constitutes the entire
agreement and supersedes all prior agreements and understandings, both
written and oral, between the Zoetis Parties (or any of them) and Target
with respect to the subject matter hereof, it being understood that the
Zoetis Confidentiality Agreement shall survive the execution and
delivery of this Agreement and that no action by any Party contemplated
by this Agreement shall be deemed to breach the Zoetis Confidentiality
Agreement.
10.7 Inadequacy of Damages
Each Party agrees that damages would not be an adequate remedy for any
breach by it of this Agreement and accordingly each Party shall be
entitled, without proof of special damages, to the remedies of
injunction, specific performance or other equitable relief for any
threatened or actual breach of this Agreement.
10.8 Remedies and Waivers
No delay or omission by either Party to this Agreement in exercising any
right, power or remedy provided by Law or under this Agreement shall:
(a) affect that right, power or remedy; or
(b) operate as a waiver of it.
The exercise or partial exercise of any right, power or remedy provided
by Law or under this Agreement shall not preclude any other or further
exercise of it or the exercise of any other right, power or remedy.
10.9 Severability
If at any time any provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect under the Law of any
jurisdiction that shall not affect or impair:
(a) the legality, validity or enforceability in that jurisdiction of any
other provision of this Agreement; or
(b) the legality, validity or enforceability under the Law of any other
jurisdiction of that or any other provision of this Agreement; and
it is agreed by the Parties that a court of competent jurisdiction may
sever any such invalid, illegal or unenforceable provision and should
any provision of this Agreement be invalid or unenforceable, then such
provision shall be deemed to have been automatically amended in such a
way that, as amended, it is valid, legal and unenforceable and to the
maximum extent possible carries out the original intent of the Parties
as to the matter or matters in question.
10.10 No Partnership and No Agency
(a) Nothing in this Agreement and no action taken by the Parties
pursuant to this Agreement shall constitute, or be deemed to constitute,
a partnership, association, joint venture or other co-operative entity
between any of the Parties.
(b) Nothing in this Agreement and no action taken by the Parties
pursuant to this Agreement shall constitute, or be deemed to constitute,
either Party the agent of the other Party for any purpose. No Party has,
pursuant to this Agreement, any authority or power to bind or to
contract in the name of the other Party.
10.11 Further Assurance
Without limitation to the provisions of this Agreement, the Parties
shall, and shall procure that each member of their respective Groups
shall, issue, execute or despatch such documentation in a reasonably
timely fashion or take other actions as is necessary or desirable to
facilitate the implementation of the Transactions or carry out the
purposes of this Agreement.
10.12 Costs and Expenses
Save for the Panel’s document review fees (which shall be borne and
discharged by Zoetis), each Party shall pay its own costs and expenses
of and incidental to this Agreement, the Acquisition and all other
Transactions, except as otherwise provided in this Agreement.
10.13 No Third-Party Rights
Subject as provided in Clauses 7.2, 10.5 and 10.14(c), no one other than
a Party shall have any right to enforce any of its terms and no third
party shall be a beneficiary in any way of this Agreement or have the
right to rely on any provision hereof.
10.14 Governing Law and Jurisdiction
(a) Except as provided herein, this Agreement shall be governed by, and
construed in accordance with, the Laws of Ireland, without regard to the
conflicts of law rules of Ireland that would result in the application
of the laws of any other jurisdiction.
(b) Except as provided herein, each of the Parties irrevocably agrees
that the courts of Ireland are to have exclusive jurisdiction to settle
any dispute arising out of or in connection with this Agreement and, for
such purposes, irrevocably submits to the exclusive jurisdiction of such
courts in Ireland. Any proceeding, suit or action arising out of or in
connection with this Agreement shall therefore be brought in the courts
of Ireland.
(c) Each of the Parties hereto hereby waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in
respect of any Action (whether at law, in equity, in contract, in tort
or otherwise) arising out of, or in any way relating to, this Agreement,
any of the Transactions or the performance of services thereunder or
related thereto.
10.15 Non-Survival of Representations and Warranties
None of the representations and warranties in this Agreement shall
survive the Effective Time or the termination of this Agreement.
IN WITNESS WHEREOF, the Parties have entered into this
Agreement on the date specified above.
Schedule 1
TARGET CONDUCT
At all times from the execution of this Agreement until the earlier of
the Effective Time and the date, if any, on which the Agreement is
terminated pursuant to Clause 9, except as may be required by applicable
Law, or as expressly contemplated or expressly permitted elsewhere in
this Agreement or in Part B of the Target Disclosure Letter, or as
expressly agreed to in writing by Zoetis (Zoetis acting reasonably at
all times and such agreement not to be unreasonably withheld,
conditioned or delayed), Target undertakes to and covenants with Zoetis
that it:
1. shall, and shall procure that its Subsidiaries shall, take all
actions described in Section 1 of Part B of the Disclosure Letter;
2. shall not, and shall procure that its Subsidiaries shall not,
authorise or pay any dividends on or make any distribution with respect
to the outstanding shares in its capital (whether in cash, assets,
shares or other securities of any member of the Target Group);
3. shall not, and shall procure that its Subsidiaries shall not, split,
combine or reclassify any of its shares of capital in issue, or issue or
authorise the issuance of any other securities in respect of, in lieu of
or in substitution for, shares in its capital;
4. shall not, and shall procure that its Subsidiaries shall not:
(a) except pursuant to any pre-existing contractual obligations owed to
any Target Associate, increase the compensation (including bonus and
equity opportunities), severance or termination pay, modify the benefits
payable or provided to any Target Associate or former employee,
independent contractor or director of or to any member of the Target
Group, other than to the extent required by the terms of a Target
Benefit Plan or applicable Law; provided that, in respect of short-term
incentive compensation for the year ending June 30, 2017, Target will
limit its cash bonus pool to US$970,000;
(b) hire any individual or terminate the employment or service of any
individual (whether as an Executive Officer, employee, independent
contractor or consultant), in each case, other than in the ordinary
course of business consistent with past practice;
(c) enter into any employment, consulting, change of control, severance
or retention agreement or arrangement with any Target Associate or
former employee, independent contractor, consultant or director of or to
any member of the Target Group, other than amounts required to be paid
under applicable Law or an existing Target Benefit Plan;
(d) establish, adopt, enter into, amend or terminate any Target Benefit
Plan or any other plan, trust, fund, policy or arrangement for the
benefit of any Target Associate or former employee, independent
contractor, consultant or director of or to any member of the Target
Group or any of their beneficiaries, except as required to comply with
applicable Law;
(e) fund any rabbi trust or similar arrangement or otherwise take any
action to fund or in any other way secure the payment of compensation or
benefits under any Target Benefit Plan or other plan, policy, agreement
or arrangement, except as required by applicable Law or an existing
Target Benefit Plan;
(f) exercise any discretion to pay or accelerate the vesting or payment
of, or otherwise increase or accelerate other rights or benefits with
respect to, any compensation or benefit under any Target Benefit Plan or
other plan, policy, agreement or arrangement, except as required by
applicable Law or an existing Target Benefit Plan; or
(g) change any actuarial assumptions used to calculate the funding
obligations with respect to any Target Benefit Plan or change the manner
in which contributions to such plans are made or the basis on which such
contributions are determined, except as may be required by US GAAP or
applicable Law or any Target Benefit Plan in effect as of the date
hereof);
5. shall not, and shall not permit any of its Subsidiaries to, make any
change in financial accounting policies or procedures or any of its
methods of reporting income, deductions or other material items for
financial accounting purposes, except as required by a change in
US GAAP, applicable Law or SEC policy;
6. shall not, and shall not permit any of its Subsidiaries to, authorise
or announce an intention to authorise, or enter into agreements with
respect to, any acquisitions of an equity interest in any joint venture
arrangement, or acquisitions of an equity interest in or a substantial
portion of the assets of any person or any business or division thereof,
or any mergers, consolidations or business combinations (for the purpose
of this paragraph 6, each such event an “Investment”), other than
(i) as expressly permitted by Clause 5.2 of the Agreement, or (ii) in
respect of any Investment which relates to a minority investment by any
member of the Target Group, for consideration of not more than
US$150,000 for each Investment (so long as it is an Investment which
results in Target’s and its Subsidiaries’ ownership being less than 20%
of the equity interests of the invested entity and Target cannot
consolidate such entity for financial reporting or tax purposes) and
limited to no more than five such Investments;
7. shall not amend the Articles of Association or any other
Organisational Documents and shall not permit any of its Subsidiaries to
adopt any material amendments to its Organisational Documents;
8. shall not, and shall procure that its Subsidiaries shall not, enter
into any Contract (other than (a) amendments to Contracts in the
ordinary course of business, (b) any standard terms and conditions or
amendments thereto, or (c) Contracts in connection with Target’s planned
clinical studies for ranevetmab or frunevetmab) that would be a Material
Contract if such Contract had been entered into prior to the date hereof
(and where agreement to effect any of the matters set out in this
paragraph 8 is sought from Zoetis, Zoetis shall have 72 hours from
receipt of any written request from Target to respond in writing to such
request, failing which Zoetis shall be deemed to have agreed to such
action);
9. shall not, and shall not permit any of its Subsidiaries to, issue,
deliver, grant, sell, pledge, dispose of or encumber, or authorise the
issuance, delivery, grant, sale, pledge, disposition or encumbrance of,
any shares in its capital, voting securities or other equity interest in
any member of the Target Group or any securities convertible into or
exchangeable for any such shares, voting securities or equity interest,
or any rights, restricted share units, warrants or options to acquire
any such shares in its capital, voting securities or equity interest or
any “phantom” stock, “phantom” stock rights, stock units, stock
appreciation rights or stock based performance units or take any action
to cause to be exercisable any otherwise un-exercisable Target
Convertible Security (except as otherwise provided by the express terms
of any Target Convertible Securities outstanding on the date hereof);
10. shall not, and shall not permit any of its Subsidiaries to, directly
or indirectly, purchase, redeem or otherwise acquire any shares in its
capital or any rights, warrants or options to acquire any such shares in
its capital, other than in relation to the valid exercise of any Target
Convertible Security or as otherwise may be agreed with Zoetis;
11. shall not, and shall not permit any of its Subsidiaries to, redeem,
repurchase, prepay (other than prepayments of revolving loans), defease,
incur, assume, endorse, guarantee or otherwise become liable for or
modify in any material respects the terms of any Indebtedness for
borrowed money or issue or sell any debt securities or calls, options,
warrants or other rights to acquire any debt securities (directly,
contingently or otherwise), provided that the foregoing shall not
prohibit Target and its Subsidiaries from making guarantees or obtaining
letters of credit or surety bonds for the benefit of commercial
counterparties in the ordinary course of business consistent with past
practices;
12. shall not, and shall not permit any of its Subsidiaries to, acquire,
lease, license or otherwise obtain any of its material properties or
assets, or to sell, lease, exclusively license, transfer, exchange, swap
or otherwise dispose of, or subject to any Encumbrance (other than
Permitted Encumbrances), any of its material properties or assets, other
than:
(a) dispositions of inventory or equipment in the ordinary course of
business;
(b) non-exclusive Intellectual Property licences in connection with
product development, publishing or brand licensing for the benefit of
Target, or exclusive Intellectual Property licences in connection with
brand licences, in each case in the ordinary course of business
consistent with past practices;
(c) for transactions among Target and its wholly-owned Subsidiaries or
among its wholly-owned Subsidiaries in the ordinary course of business
consistent with past practices; or
(d) for transactions (excluding transactions for the purchase or sale of
Intellectual Property) in the ordinary course of business consistent
with past practice involving less than US$250,000 individually or in the
aggregate;
13. shall not, and shall procure that its Subsidiaries shall not, enter
into a new line of business that is material to the Target Group;
14. shall not, and shall procure that its Subsidiaries shall not,
(A) other than in the ordinary course of business consistent with past
practice, enter into any Contract pursuant to which any member of the
Target Group grants to any other Person any non-competition,
“most-favoured nation”, exclusive marketing or other exclusive rights
(other than exclusive brand licences, and non-solicitation agreements
with respect to employees) of any type or scope, or that otherwise
restricts or purports on its face to restrict in a material respect any
member of the Target Group from engaging or competing in any material
line of business in any location; or (B) enter into any Contract that,
upon completion of the Acquisition, would restrict or purport on its
face to restrict Zoetis or any of its Subsidiaries (including any member
of the Target Group) from engaging or competing in any line of business
in any location;
15. shall not, and shall procure that its Subsidiaries shall not, adopt,
approve or implement any “poison pill” or similar rights plan or related
agreement;
16. shall not, and shall procure that its Subsidiaries shall not,
announce, implement or effect any reduction in labour force, lay-off,
early retirement program, severance program or other program or effort
concerning the termination of employment of Target Associates, other
than, to the extent permitted by Section 3.2, routine employee
terminations in the ordinary course of business consistent with past
practices;
17. shall not, and shall procure that its Subsidiaries shall not, engage
in any merger;
18. shall not, and shall not permit any of its Subsidiaries to,
compromise or settle any material claim, litigation, investigation or
proceeding, in each case made or pending against any member of the
Target Group or any of their officers and directors in their capacities
as such, other than the compromise or settlement of claims, litigation,
investigations or proceedings where any such compromise or settlement
results in the actual expense to be incurred being no greater,
individually or in the aggregate, than US$150,000; and does not impose
any injunctive relief or otherwise limit any action or inaction other
than the payment of monetary relief as set forth in this paragraph 18 by
Target and its Subsidiaries;
19. shall not, and shall not permit any of its Subsidiaries to,
(i) make, change or revoke any material Tax election, change any annual
Tax accounting period or method of Tax accounting unless in each case
required by applicable Law, (ii) settle or compromise any corporate
income tax audit or proceeding relating to a material amount of Taxes,
or material claim for refund, or enter into any closing or similar
agreement with any Tax Authority other than entering into the process
for claiming tax credits in the ordinary course consistent with past
practice, or (iii) make, change or revoke any Tax election which results
in any modification of the pass through or transparency status, or lack
thereof, of any entity in any jurisdiction, and where such agreement to
effect any of the matters set out in this paragraph 19 is sought from
Zoetis, Zoetis will have 72 hours from receipt of any written request
from Target to respond in writing to such request, failing which Zoetis
will be deemed to have agreed to such action;
20. shall not, and shall not permit any of its Subsidiaries to, make any
new capital expenditure, or commit to do so, except as permitted, in
excess of US$250,000 in aggregate;
21. shall not, and shall not permit any of its Subsidiaries to, alter
any intercompany arrangements or agreements or the ownership structure
among Target and its wholly-owned Subsidiaries or among Target’s
wholly-owned Subsidiaries;
22. to the extent permitted by applicable Law, shall, and shall procure
that its Subsidiaries shall, upon request by Zoetis reasonably in
advance, provide Zoetis with reasonable access, during normal business
hours and where not unduly disruptive to Target’s business, to the
Target Group’s personnel, assets, properties, offices and other
facilities, and books and records, and shall furnish Zoetis and Zoetis’
Representatives with such financial, operating and other information as
reasonably requested by Zoetis which is not subject to legal privilege,
any confidentiality or non-disclosure provisions in favour of a third
party or in relation to any Target Alternative Proposal;
23. shall, and shall procure that its Subsidiaries shall, perform
obligations under all Material Contracts;
24. shall not, and shall not permit any of its Subsidiaries to, adopt a
plan of complete or partial liquidation, dissolution, restructuring,
recapitalisation or other reorganization of Target or its Subsidiaries;
25. shall, and shall procure that its Subsidiaries shall, promptly
notify Zoetis orally and in writing: upon an Executive Officer becoming
actually aware: (i) that any representation or warranty made by it in
this Agreement has become untrue or inaccurate in any material respect,
or of any failure by Target to comply in any material respect with any
material covenant or condition of this Agreement required to be complied
with by it pursuant to this Agreement; and (ii) of any material Action
commenced against Target or any of its Subsidiaries; it being
acknowledged and agreed by each of the Parties that one or more breaches
of this paragraph 25 shall not permit Zoetis to terminate this Agreement
or constitute a failure of any Condition unless the cumulative effect of
such matters not disclosed would have or would reasonably be expected
have a material adverse effect on the Target Group; and
26. shall, provide Zoetis as soon as reasonably practicable after
receipt or delivery thereof, copies of all written correspondence and
any other written material exchanged between any member of the Target
Group (or any of their respective Representatives) and any Governmental
Body.
Nothing contained in this Agreement shall give Zoetis or Zoetis Bidco,
directly or indirectly, the right to control or direct the Target Group
operations prior to the Effective Date.
Schedule 2
SEVERANCE FORMULA
Australia
a) Where a Target Employee’s employment is terminated by reason of
redundancy, then the following severance entitlements shall apply as set
out in the Fair Work Act 2009 (Cth) Section 119 (2).
|
Redundancy pay period
|
|
|
Employee's period of continuous service with the employer on
termination
|
Redundancy pay period
|
|
1
|
At least 1 year but less than 2 years
|
4 weeks
|
|
2
|
At least 2 years but less than 3 years
|
6 weeks
|
|
3
|
At least 3 years but less than 4 years
|
7 weeks
|
|
4
|
At least 4 years but less than 5 years
|
8 weeks
|
|
5
|
At least 5 years but less than 6 years
|
10 weeks
|
|
6
|
At least 6 years but less than 7 years
|
11 weeks
|
|
7
|
At least 7 years but less than 8 years
|
13 weeks
|
|
8
|
At least 8 years but less than 9 years
|
14 weeks
|
|
9
|
At least 9 years but less than 10 years
|
16 weeks
|
|
10
|
At least 10 years
|
12 weeks
|
Severance pay is payable on the Target Employee’s base salary
b) Long Service leave in accordance with the Victorian (Australia) Long
Service Leave Act (Vic) 1992
c) All accrued annual leave will be payable at the then current base
salary rate.
d) Notice period and other benefits in accordance with Target Employee
employment contract.
Ireland
a) Where a Target Employee’s employment is terminated by reason of
redundancy, then the following severance entitlements shall apply in
accordance with the Irish Redundancy Payments Act 1967.
An employee with 104 weeks (two years) continuous service will be
eligible for two weeks’ base pay for each year of service (with a weeks’
pay being capped at EUR€600.00 gross).
b) All accrued Annual Leave will be payable at the then current base
rate.
c) Notice period and other benefits in accordance with Target Employee’s
employment contract.
United States
Where a Target Employee’s employment is involuntary termination then the
following entitlements shall apply.
a) Notice period and other benefits in accordance with Target Employee’s
employment contract.
b) All accrued Paid Time Off will be payable at the then current base
salary rate.
Outplacement Program
Prior to the Effective Date the Target Group provides an Outplacement
Program to terminated Target Employees as part of the severance benefit.
Schedule 3
RULE 2.5 ANNOUNCEMENT
Zoetis Inc.
By:
Name: Juan Ramón Alaix
Title: Chief Executive Officer
[Transaction Agreement - Signature Page]
On behalf of Zoetis Belgium S.A.
By: _____________________________
Name: Roman Trawicki
Title: Director
[Transaction Agreement - Signature Page]
|
Signed by ____________________
Duly authorised on behalf of
NEXVET BIOPHARMA PUBLIC
LIMITED COMPANY
|
___________________________
Director
|
[Transaction Agreement - Signature Page]
Media Contacts
Zoetis and Zoetis Bidco
Elinore White, +1 973 443 2835
elinore.y.white@zoetis.com
Bill Price, +1 973 443 2742
william.price@zoetis.com
or
Nexvet
Mark Heffernan, +1 415 602 5587
mark.heffernan@nexvet.com
Damian Lismore, +61 417 351 272
damian.lismore@nexvet.com
or
Investor Contacts
Zoetis and Zoetis Bidco
Steve Frank, +1 973 822 7141
steve.frank@zoetis.com
or
Nexvet
Mark Heffernan, +1 415 602 5587
mark.heffernan@nexvet.com
Damian Lismore, +61 417 351 272
damian.lismore@nexvet.com
or
Financial Adviser Contacts
Zoetis and Zoetis Bidco
Goldman Sachs
Nick Harper, +44 20 7774 1000
Jo Natauri, +1 212 902 1000
or
Nexvet
Evercore
John Honts, +1 212 857 3100
Simon Elliott, +44 20 7653 6000
or
Cowen and Company
George Milstein, +1 415 646 7394
Michael Campbell, +1 415 646 7262