The law firm said pre-merger NextCure holders are expected to own 1.21% of the combined company and receive a contingent value right tied to pipeline asset monetization.
Ademi LLP said it is investigating NextCure's recently announced transaction with Avere Therapeutics for possible breaches of fiduciary duty and other legal violations. Under the merger terms described in the announcement, pre-merger NextCure stockholders are expected to own about 1.21% of the combined company, while pre-merger Avere stockholders would hold about 98.79%. NextCure stockholders are also slated to receive a contingent value right, or CVR (a contractual right to future payouts), entitling them to 90% of net proceeds from any monetization of NextCure's pipeline assets during the two years after closing. Ademi also said NextCure insiders will receive substantial benefits under change of control arrangements and argued the transaction agreement limits competing bids by imposing a significant penalty if NextCure accepts another offer. The firm said it is examining whether the NextCure board of directors is meeting its fiduciary duties to all shareholders.