value of the transaction to be payable by the Company to Lilly in the event the Company terminated the Merger Agreement to accept a superior proposal or upon certain other customary termination
events. Also on June 24, 2024, Kirkland sent to Fenwick a draft exclusivity agreement providing for an exclusivity period ending on July 15, 2024.
On June 25, 2024, Fenwick sent to Kirkland a revised version of the exclusivity agreement providing for, among other customary provisions, an exclusivity
period ending on July 11, 2024. Later that day, the parties finalized and executed the exclusivity agreement providing for an exclusivity period ending on July 11, 2024.
Also on June 25, 2024, the Company provided Lilly and its advisors with access to an expanded online data room, and representatives of Fenwick provided
Kirkland with a draft Tender and Support Agreement to be entered into by certain Company stockholders committing to tender their Shares into the tender offer and which contained certain other customary provisions.
On June 27, 2024, Kirkland provided Fenwick with revised drafts of the Merger Agreement and Tender and Support Agreement. The revised draft of the Merger
Agreement proposed a number of changes to the draft previously circulated by Fenwick, including changes to the definition of Company Material Adverse Effect, removing Lillys obligation to commit to any divestitures or other actions
if required in order to obtain United States regulatory clearance, and increasing the amount of the termination fee payable by the Company if it terminated the Merger Agreement to accept a superior proposal to 4.25% of the equity value of the
transaction.
On June 28, 2024, representatives of Fenwick discussed the revised draft of the Merger Agreement with representatives of the
Companys senior management and Centerview.
Also on June 28, 2024, Dr. Rogers, Dr. Lippa and Mr. Pelta met with representatives
of Lilly and discussed the Companys preclinical pipeline.
Between June 28, 2024 and July 2, 2024, members of the Companys
management held various diligence calls with representatives of Lilly, including with respect to information technology, intellectual property and contract matters, certain of which were attended by representatives of Fenwick.
On June 29, 2024, representatives of Fenwick and Kirkland discussed certain issues in the Merger Agreement, and, following that discussion, Fenwick sent
Kirkland revised drafts of the Merger Agreement and Tender and Support Agreement. The revised draft of the Merger Agreement, among other things, made revisions to the definition of Company Material Adverse Effect and decreased the amount
of the termination fee payable by the Company if it terminated the Merger Agreement to accept a superior proposal to 3.0% of the equity value of the transaction.
On June 30, 2024, Fenwick provided Kirkland with a draft of the disclosure schedules to the Merger Agreement, and, from July 1, 2024 through
July 6, 2024, representatives of Fenwick and Kirkland exchanged revised drafts of these disclosure schedules.
On July 1, 2024, representatives
of Fenwick and Kirkland discussed unresolved issues in the Merger Agreement. Following this discussion, on July 1, 2024, Kirkland sent to Fenwick a revised draft of the Merger Agreement which, among other terms, provided for a termination fee
equal to 4.0% of the equity value of the transaction.
On July 2, 2024, representatives of Fenwick and Kirkland again discussed the remaining
unresolved issues in the Merger Agreement, and Fenwick sent to Kirkland a further revised draft of the Merger Agreement, which, among other terms, provided for a termination fee equal to 3.3% of the equity value of the transaction.
On July 3, 2024, representatives of Fenwick and Kirkland discussed the remaining unresolved issues in the Merger Agreement, and thereafter Fenwick
provided Kirkland with a revised draft of the Merger Agreement that reflected the resolution of these issues, including, among other terms, a termination fee equal to $118.00 million (representing approximately 3.7% of the equity value of the
transaction).
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