Paratek Pharmaceuticals Files Definitive Proxy Statement And Letter To Stockholders In Connection With Acquisition By Gurnet Point Capital And Novo Holdings

Transaction Provides Paratek Stockholders with Immediate Value and Liquidity
 

Stockholders to Receive Upfront Cash Payment of $2.15 per Share and a Contingent Value Right of $0.85 per Share on Achievement of a Commercial Milestone for a Total Potential Value of $3.00 per Share

Special Meeting of Stockholders to be Held on Sept. 18, 2023 at 9 a.m. ET

BOSTON, Aug. 02, 2023 (GLOBE NEWSWIRE) -- Paratek Pharmaceuticals, Inc. ("Paratek") (NASDAQ:PRTK), a commercial-stage biopharmaceutical company focused on the development and commercialization of novel therapies for life-threatening diseases and other public health threats, today announced that it has filed definitive proxy materials and a letter to Paratek stockholders with the U.S. Securities and Exchange Commission in connection with the Company's previously announced definitive agreement to be acquired by Gurnet Point Capital ("Gurnet Point") and Novo Holdings A/S ("Novo Holdings"). Paratek will commence mailing the definitive proxy statement and letter to its stockholders on Aug. 2, 2023.

The special meeting of stockholders of Paratek will be held virtually via live webcast on Monday, Sept. 18, 2023 at 9 a.m. ET.

The board of directors of Paratek recommends that stockholders vote "FOR" each of the proposals listed on the WHITE proxy card enclosed with the definitive proxy statement.

Stockholders who have questions about voting their proxy are encouraged to contact our proxy solicitor Morrow Sodali LLC at +1 (800) 662-5200 (toll-free in North America), +1 (203) 658-9400 (collect outside of North America) or [email protected]

The full text of Paratek's letter to stockholders follows:

Dear Fellow Paratek Stockholders,

I, together with all of my fellow directors, are pleased to present you with the opportunity for the Company to be acquired at a significant premium to our unaffected stock price. The Board unanimously determined that the transaction is in your best interest. Now we are asking for you to vote "FOR" the transaction at a special meeting of stockholders.

As you saw, on June 6, 2023, we announced a definitive agreement to be acquired by Gurnet Point Capital and Novo Holdings A/S.

As a stockholder, upon closing of the transaction, you will receive both an immediate cash payment of $2.15 per share plus a contingent value right ("CVR") of $0.85 per share payable upon the achievement of a net sales threshold for NUZYRA. This represents an aggregate potential total value of $3.00 per share.

The upfront cash payment at the closing of the transaction represents a premium of 41% over the closing price of our common stock as of May 31, 2023, which was the last full trading day prior to market speculation regarding a potential sale of the Company.

This agreement comes as a result of a long and robust process, involving multiple competing parties, to maximize stockholder value. Furthermore, amid today's challenging market backdrop and the Company's steep near-term financing need, without this transaction, Paratek could be forced to undertake significantly dilutive equity issuances that would severely impact stockholder value, or even consider bankruptcy.

We believe that this transaction, which is unanimously supported by the Board, is the best path to deliver the most value to you as a stockholder of the Company.

I encourage you to review our definitive proxy materials and vote "FOR" the transaction. Every vote is important. If you do not vote, it has the same effect as voting against the transaction. You must vote now to preserve and maximize the value of your shares.

The Transaction Delivers to You Immediate Value, Liquidity, Certainty of the All-Cash Consideration and Upside Participation

The transaction allows you to immediately recognize the value of your investment in Paratek through the $2.15 per share cash payment made at the closing of the transaction, achieve immediate liquidity, de-risk your ongoing exposure to the financial and liquidity status of Paratek on a standalone basis, and continue to have the opportunity to participate in the upside potential of NUZYRA through the CVR.

The CVR's potential $0.85 per share payout is triggered upon the achievement of $320 million in U.S. NUZYRA net sales (excluding certain permitted deductions, payments under Paratek's contract with ASPR-BARDA, certain government payments and certain royalty revenue) in any calendar year ending on or prior to December 31, 2026.

The Board believes that the CVR milestone is achievable based on the Company's most recent sales, forecasts and the commitment of the buyer to use commercially reasonable efforts to achieve the milestone.

Any Standalone Alternative Would Likely Result in Substantial Dilution or Bankruptcy

The Board unanimously determined that the transaction is in your best interests, and superior to the standalone alternative.

Without a transaction, Paratek faces a challenging market backdrop while having to prepare for the upcoming maturity of our convertible notes in May 2024 and liquidity needs that would have necessitated the issuance of significant equity, severely diluting you and all of your fellow stockholders. These risks were reflected in the value of our shares.

Substantial efforts prior to the announced transaction to secure such financings were unsuccessful, and there was and remains substantial doubt that Paratek could complete the required financing at all. The Board believes that the failure to complete such financings in the near-term has the potential to result in bankruptcy.

The Transaction was the Result of a Robust Process Led by the Independent Members of the Board

The Board formed a Transaction Committee consisting solely of the independent members of the Board to oversee and direct the strategic transaction process. No members of management were included on the Transaction Committee.

The Company and its advisors conducted a robust and thorough, approximately two-year process. The last six months saw significantly increased intensity of engagement with multiple parties interested in potential strategic business relationships or combinations. These activities included entering into confidentiality agreements, having third parties and Paratek conduct due diligence and negotiating potential terms of strategic business relationships and combinations.

At the end of this robust and thorough process, the Board unanimously determined that the transaction we are recommending to you is the best deal available to you and your fellow stockholders.

The Board also determined that the modest breakup fee equivalent to approximately $0.08 per share would not deter serious potential purchasers from offering a superior transaction. To date, no superior offer has emerged.

The Choice is Clear and the Time for You to Take Action is Here

Please vote your proxy today "FOR" the transaction.

It is important that you act soon – the special meeting of stockholders to consider will be held virtually on Monday, Sept. 18, 2023 at 9 a.m. ET.