Jaguar Animal Health Inc (NASDAQ:JAGX) announced that it had entered into a non-binding letter of intent (the “LOI”) with Napo Pharmaceuticals, Inc. (“Napo”) potentially to merge the two companies. The LOI contemplates a 3-to-1 Napo-to-Jaguar value ratio (inclusive only of in-the-money convertible securities of the Company at the time a definitive agreement is entered into) to calculate the relative ownership of the merged entity. The LOI also outlines capitalization requirements that Napo would be required to satisfy to proceed with a potential merger.
The LOI is non-binding and any agreement is subject to the negotiation and execution of a definitive transaction agreement, which may vary from the terms set forth in the LOI. A final transaction also is anticipated to be subject to material conditions, including, but not limited to, the approval of: (i) the respective boards of directors of the Company and Napo, (ii) the shareholders of each company, (iii) the Nasdaq Stock Market, and (iv) other customary conditions for a transaction of this nature. Accordingly, there can be no assurance that a definitive agreement will be reached by the companies, or that any agreement will result in the completion of a merger transaction.
The foregoing description of the LOI does not purport to be complete and is qualified in its entirety by reference to the full text of the LOI, a copy of which will is attached as Exhibit 10.1 hereto and is incorporated herein by reference.
In addition, on October 6, 2016, the Company announced that Aspire Capital Fund, LLC (“Aspire”) purchased 348,601 shares of the Company’s common stock for an aggregate purchase price of $794,810.28, or a price per share of $2.28, under the existing $15 million Common Stock Purchase Agreement, dated June 8, 2016, between Aspire and the Company (the “CSPA”). A copy of the CSPA was attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 9, 2016.
The Company issued a press release generally describing the proposed merger and the issuance of shares of the Company’s common stock to Aspire under the CSPA. The Company is furnishing a copy of the press release, which is attached as Exhibit 99.1 to this Form 8-K.