Item
1.01 Entry into a Material Definitive Agreement.
Agreement
and Plan of Merger
On
March 12, 2023, Provention Bio, Inc., a Delaware corporation (the “Company” or “Provention”), entered into an
Agreement and Plan of Merger (the “Merger Agreement”) with Sanofi S.A., a French société anonyme (“Parent”),
and Parent’s indirect wholly-owned subsidiary, Zest Acquisition Sub, Inc., a Delaware corporation (“Purchaser”).
Pursuant
to the Merger Agreement, and upon the terms and subject to the conditions thereof, Purchaser will commence a tender offer (the “Offer”)
to purchase all of the issued and outstanding shares (the “Shares”) of common stock, par value $0.0001 per share (the “Common
Stock”), of the Company at a price of $25.00 per Share, to the seller in cash, without interest, but subject to any applicable
withholding of taxes (the “Offer Price”). If certain conditions are satisfied and the Offer closes, Parent would acquire
any remaining Shares by a merger of Purchaser with and into the Company (the “Merger”).
The
Merger Agreement contemplates that the Merger will be effected pursuant to Section 251(h) of the General Corporation Law of the State
of Delaware (the “DGCL”), which permits completion of the Merger without a shareholder vote promptly following consummation
of the Offer. The obligation of Parent and Purchaser to consummate the Offer is subject to the condition that there be validly tendered,
and not properly withdrawn, prior to the expiration of the Offer, that number of Shares that, together with the number of Shares, if
any, then owned beneficially by Parent and Purchaser (together with their wholly-owned subsidiaries), represents at least a majority
of the Shares outstanding as of the consummation of the Offer (the “Minimum Tender Condition”). The Minimum Tender Condition
may not be waived by Purchaser without the prior written consent of the Company. The obligation of Purchaser to consummate the Offer
is also subject to the expiration of the waiting period (and any extension thereof) under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976 and other customary conditions. Consummation of the Offer is not subject to a financing condition.
Following
the consummation of the Offer and subject to the terms and conditions of the Merger Agreement, Purchaser will merge with and into the
Company pursuant to the provisions of Section 251(h) of the DGCL as provided in the Merger Agreement, with the Company being the surviving
corporation. At the effective time of the Merger (the “Effective Time”), each Share (other than (i) Shares held in the treasury
of the Company, (ii) Shares owned by Parent, the Company or any of their respective direct or indirect wholly-owned subsidiaries (other
than Purchaser), (iii) Shares irrevocably accepted for purchase in the Offer and (iv) Shares held by stockholders who have properly demanded
appraisal of such Shares in accordance with the DGCL) will be cancelled and converted into the right to receive an amount in cash equal
to the Offer Price, less applicable withholding of taxes.
The
Merger Agreement includes customary representations, warranties and covenants of the Company, Parent and Purchaser. The Company has agreed
to use commercially reasonable efforts to carry on its business in the ordinary course until the Effective Time. The Company has also
agreed not to solicit or initiate discussions with third parties regarding other proposals for a strategic transaction involving the
Company. Parent and Purchaser have agreed to use reasonable best efforts to take actions that may be required in order to obtain antitrust
approval of the proposed transaction, subject to certain limitations.
The
Merger Agreement also includes customary termination provisions for each of the Company and Parent, subject, in certain circumstances,
to the payment by the Company of a termination fee of $100.0 million (the “Termination Fee”) and the payment by Parent of
a reverse termination fee of $158.0 million (the “Reverse Termination Fee”). The Company must pay Parent the Termination
Fee if (i) the board of directors of the Company (the “Company Board”) determines to terminate the Merger Agreement in order
to enter into a definitive agreement with respect to a Superior Proposal (as defined in the Merger Agreement) and the Company so terminates
or (ii) in the event that the Merger Agreement is terminated by Parent following a change of recommendation by the Company Board, in
each case, as is more particularly described in the Merger Agreement. The Company must also pay Parent the Termination Fee if the Merger
Agreement is terminated under certain circumstances, a third party has made another acquisition proposal to the Company prior to the
termination of the Merger Agreement, and within twelve (12) months following such termination, the Company enters into an agreement for
a business combination transaction and the transactions contemplated by such acquisition proposal are subsequently consummated. The Merger
Agreement provides that Parent must pay the Company the Reverse Termination Fee if the Merger is not consummated due to the failure of
certain conditions to be satisfied as a result of failure to obtain antitrust clearance. The parties to the Merger Agreement are also
entitled to an injunction or injunctions to prevent breaches of the Merger Agreement, and to specifically enforce the terms and provisions
of the Merger Agreement.
The
Company Board unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Offer and
the Merger, are advisable and fair to, and in the best interests of, the Company and the holders of the Shares, (ii) adopted the Merger
Agreement and approved the execution, delivery and performance by the Company of the Merger Agreement and the transactions contemplated
thereby, including the Offer and the Merger and (iii) resolved to recommend that the holders of the Shares accept the Offer and tender
their Shares pursuant to the Offer.
The
foregoing summary of the principal terms of the Merger Agreement does not purport to be complete and is qualified in its entirety by
reference to the full copy of the Merger Agreement filed hereto as Exhibit 2.1 hereto and incorporated herein by reference. The summary
and the copy of the Merger Agreement are intended to provide information regarding the terms of the Merger Agreement and are not intended
to modify or supplement any factual disclosures about the Company in its public reports filed with the U.S. Securities and Exchange Commission
(“SEC”). The assertions embodied in the representations and warranties included in the Merger Agreement were made solely
for purposes of the contract among the Company, Purchaser and Parent and are subject to important qualifications and limitations agreed
to by the Company, Purchaser and Parent in connection with the negotiated terms, including being qualified by confidential disclosures
made by each contracting party to the other for the purposes of allocating contractual risk between them that differ from those applicable
to investors. 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 the Company’s SEC filings or may
have been used for purposes of allocating risk among the Company, Purchaser and Parent rather than establishing matters as facts. Investors
should not rely on the representations and warranties or any description of them as characterizations of the actual state of facts of
the Company, Parent, Purchaser or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter
of the representations and warranties may change after the date of the Merger Agreement, and this subsequent information may or may not
be fully reflected in public disclosures by the Company or Parent.