Item 1.01 Entry into a Material Definitive Agreement.
Merger Agreement
On April 10, 2008, Millennium Pharmaceuticals, Inc., a Delaware corporation (the "Company"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with Takeda America Holdings, Inc., a New York corporation ("Parent"), and Mahogany Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Parent ("Merger Sub").
Pursuant to the Merger Agreement, upon the terms and subject to the conditions thereof:
Merger Sub will commence a tender offer (the "Offer") to acquire all of the outstanding shares of common stock of the Company at a purchase price of $25.00 per share, net to the holder in cash (the "Offer Price"), subject to any required withholding of taxes, and as soon as practicable after the consummation of the Offer and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Merger Sub will merge with and into the Company (the "Merger") and the Company will become a wholly-owned subsidiary of Parent. In the Merger, the shares of the Company remaining outstanding following the consummation of the Offer, other than shares held by Parent or its subsidiaries or by stockholders who have validly exercised their appraisal rights under Delaware law, will be converted into the right to receive the Offer Price.
Concurrently with the execution of the Merger Agreement, certain of the Company's directors and executive officers entered into a Tender and Support Agreement with Parent and Merger Sub (the "Support Agreement").
The obligation of Merger Sub to accept for payment and pay for the shares tendered in the Offer is subject to the satisfaction or waiver of a number of conditions set forth in the Merger Agreement, including the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act and the antitrust laws of certain other applicable foreign jurisdictions. In addition, it is a condition to Merger Sub's obligation to accept for payment and pay for the shares tendered in the Offer that the number of the outstanding shares of the Company's common stock that have been validly tendered (including by guaranteed delivery) and not properly withdrawn, together with any shares of the Company's common stock owned by Parent or its subsidiaries, equals at least a majority of the Company's outstanding common stock on a fully-diluted basis.
The closing of the Merger is subject to customary closing conditions. The parties have agreed that if, following completion of the Offer, Parent and Merger Sub, together with their corporate parent, Takeda Pharmaceutical Company Limited, a corporation organized under the laws of Japan, own at least 90% of the outstanding shares of the Company's common stock, the Merger will be completed without a meeting of the Company's stockholders, pursuant to Delaware's "short-form" merger statute.
The Merger Agreement includes customary representations, warranties and covenants of the Company, Parent and Merger Sub. The Company has agreed to use reasonable best efforts to operate its business in the ordinary course until the Offer is consummated. The Company has agreed not to solicit or initiate discussions with third parties regarding other proposals to acquire the Company and to certain restrictions on its ability to respond to any such proposal. The Merger Agreement also includes customary termination provisions for both the Company and Parent and provides that, in connection with the termination of the Merger Agreement under specified circumstances, the Company will be required to pay Parent a termination fee of $247.3 million.
Pursuant to the Merger Agreement, the Company has granted to Merger Sub an option (the "Top-Up Option") to purchase the number of shares of the Company's common stock that, when added to the number of shares of the Company's common stock owned by Merger Sub immediately prior to such exercise, shall constitute at least 90% of the number of shares of the Company's common stock outstanding after such exercise. The per share exercise price of the Top-Up Option is equal to the Offer Price. However, the number of Shares subject to the Top-Up Option is limited to the number of authorized and unissued shares of the Company's common stock that are not otherwise reserved.
A copy of the Merger Agreement is attached as Exhibit 2.1 to this report and is incorporated herein by reference. The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement.
The Merger Agreement contains representations and warranties of the Company, Parent and Merger Sub made to each other as of specific dates. The assertions embodied in those representations and warranties were made solely for purposes of the contract among the Company, Parent and Merger Sub and may be subject to important qualifications and limitations agreed to by the Company, Parent and Merger Sub in connection with the negotiated terms. Moreover, some of those representations and warranties may not be accurate or complete as of any specified date, may be subject to a contractual standard of materiality different from those generally applicable to stockholders or may have been used for purposes allocating risk among the Company, Parent and Merger Sub rather than establishing matters as facts.
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