BCY LifeSciences Inc. and Pipex Therapeutics, Inc. Announce Proposed Business Combination Structure

20-Feb-2006

BCY LifeSciences Inc., which announced earlier that it had entered into a letter of intent with Pipex Therapeutics, Inc., has completed discussions on the proposed terms of the business combination (the "Business Combination") as set forth in a new letter of intent dated January 19, 2006 (the "Letter of Intent") and announced the proposed structure of the Business Combination.

The Letter of Intent acknowledges that the precise structure of the Business Combination is presently being reviewed with a view to providing the most efficient structure for the shareholders of both BCY and Pipex. The Letter of Intent provides for the following:

Immediately upon completion of the Business Combination, holders of common shares of Pipex and holders of common shares of BCY will hold common shares of the continuing entity in the ratio of 15.625:1 (subject to upward adjustment if Pipex's pre-closing cash position is above CDN$6.0 million). BCY shall undertake a share consolidation between 60:1 and 75:1 to facilitate the proposed ratio illustrated above. Immediately upon completion of the Business Combination, the board of directors of BCY shall consist of a majority of nominees of Pipex with three nominees from BCY's current board. The exchange of the BCY shares for the Continuing Entity shares shall be on a tax-free basis to shareholders of BCY and Pipex.

Completion of the Business Combination depends on several conditions.

The names and backgrounds of persons who will be principals of the Continuing Entity subsequent to completion of the Business Combination are as follows: Steve Kanzer, President & CEO, Pipex; Lorne Meikle, President & CEO, BCY; and Nicholas Stergis, Chief Operating Officer, Pipex.

Following the completion of the Business Combination, the Continuing Entity will have two new late-stage drug candidates, a worldwide portfolio of issued patents and patent applications, and will continue to be eligible to receive milestone payments and future royalties for DCF 987, licensed to ALIGN Pharmaceuticals, Inc. in 2005. The Continuing Entity will also retain the name Pipex Therapeutics, Inc.

https://www.bionity.com/en/news/52385/bcy-lifesciences-inc-and-pipex-therapeutics-inc-announce-proposed-business-combination-structure.html