Michigan | | | 2835 | | | 38-2367843 |
(State or other jurisdiction of incorporation or organization) | | | (Primary Standard Industrial Classification Code Number) | | | (I.R.S. Employer Identification Number) |
Michael J. Aiello Eoghan P. Keenan Michelle A. Sargent Weil, Gotshal & Manges LLP 767 5th Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 | | | Kevin H. Rhodes Executive Vice President and Chief Legal Affairs Officer Garden SpinCo Corporation c/o 3M Company 3M Center St. Paul, Minnesota 55144 | | | Steven A. Rosenblum Jenna E. Levine Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Telephone: (212) 403-1000 Facsimile: (212) 403-2000 |
Large accelerated filer | | | ☒ | | | Smaller reporting company | | | ☐ |
Accelerated filer | | | ☐ | | | Emerging growth company | | | ☐ |
Non-accelerated filer | | | ☐ | | | | |
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
Abbreviation/Term | | | Definition |
3M | | | 3M Company |
| | ||
3M board | | | The board of directors of 3M Company |
| | ||
3M Business | | | The businesses and operations conducted prior to the Distribution Time by any member of the 3M Group that are not included in the Food Safety Business |
| | ||
3M common stock | | | The common stock, par value $0.01 per share, of 3M |
| | ||
3M Exchange Debt | | | |
| | ||
3M Group | | | 3M and each entity (other than any member of the SpinCo Group) that is a direct or indirect subsidiary of 3M immediately after the Distribution Time, and each person that becomes a subsidiary of 3M after the Distribution Time |
| | ||
Asset Purchase Agreement | | | The Asset Purchase Agreement, dated as of December 13, 2021, by and between 3M and Neogen (as it may be amended from time to time) |
| | ||
CADE | | | The Administrative Council for Economic Defense of Brazil |
| | ||
Clean-Up Spin-Off | | | The distribution by 3M following the consummation of the Exchange Offer, if the Exchange Offer is not fully subscribed, of the remaining shares of Garden SpinCo common stock owned by 3M on a pro rata basis to 3M stockholders whose shares of 3M common stock remain outstanding after consummation of the Exchange Offer |
| | ||
Closing | | | The closing of the Transactions |
| | ||
Closing Date | | | The date on which the Closing actually occurs |
| | ||
Contribution | | | The transfer of assets from 3M to Garden SpinCo and the assumption of liabilities by Garden SpinCo from 3M pursuant to the Reorganization |
| | ||
Debt Exchange | | | |
| | ||
DGCL | | | Delaware General Corporation Law |
| | ||
Distribution | | | The distribution by 3M, pursuant to the Separation Agreement, of (i) up to 100% of the shares of Garden SpinCo common stock to 3M’s stockholders in this Exchange Offer followed, if necessary, by the Clean-Up Spin-Off or (ii) if this Exchange Offer is terminated, all of the outstanding shares of Garden SpinCo common stock to 3M stockholders on a pro rata basis |
| | ||
Distribution Date | | | The date on which the Distribution occurs |
Abbreviation/Term | | | Definition |
| | ||
Distribution Time | | | The time at which the Distribution occurs, which for accounting purposes shall be deemed to be 12:01 a.m., New York City time, on the Distribution Date, unless another time is selected by the parties |
| | ||
Employee Matters Agreement | | | The Employee Matters Agreement, dated as of December 13, 2021, by and among 3M, Garden SpinCo and Neogen (as it may be amended from time to time) |
| | ||
Exchange Offer | | | The exchange offer to which this prospectus relates, whereby 3M is offering to its stockholders the ability to exchange all or a portion of their shares of 3M common stock for shares of Garden SpinCo common stock, which shares of Garden SpinCo common stock will be immediately converted into the right to receive Neogen common stock in the Merger |
| | ||
Financing | | | The committed debt financing as contemplated by the Debt Commitment Letter (as defined below) |
| | ||
Food Safety Business | | | The business conducted by the Food Safety department of 3M and its subsidiaries of manufacturing, marketing, distributing, selling and servicing products or services designed or marketed for (i) detecting, enumerating and culturing (or collecting or holding for the purpose of detecting, enumerating, and culturing) microorganisms or food allergens in commercial food safety applications (except where solely performed to assess the need for or to evaluate the efficacy of filtration and separation products of the 3M Separation and Purification Sciences Division) and (ii) detecting adenosine triphosphate to determine the hygienic status of surfaces, products or environments, in each case in commercial food safety applications. |
| | ||
Garden SpinCo | | | Garden SpinCo Corporation, currently a wholly owned subsidiary of 3M |
| | ||
Garden SpinCo common stock | | | The common stock, par value $0.01 per share, of Garden SpinCo |
| | ||
Garden SpinCo stockholders | | | Pre-Merger holders of shares of Garden SpinCo common stock |
| | ||
HSR Act | | | The Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder |
| | ||
IRS Ruling | | | A private letter ruling from the Internal Revenue Service (“IRS”) regarding certain matters germane to the U.S. federal income tax consequences of the Separation, Contribution, Distribution and Merger and any related transactions as 3M may determine in good faith consultation with Neogen |
| | ||
MBCA | | | Michigan Business Corporation Act |
| | ||
Merger | | | The merger of Merger Sub with and into Garden SpinCo, with Garden SpinCo surviving the merger as a wholly owned subsidiary of Neogen, as contemplated by the Merger Agreement |
| |
Abbreviation/Term | | | Definition |
Merger Agreement | | | The Agreement and Plan of Merger, dated as of December 13, 2021, by and among 3M, Neogen, Garden SpinCo and Merger Sub (as it may be amended from time to time) |
| | ||
Merger Excluded Shares | | | The shares of Garden SpinCo common stock held by Garden SpinCo in treasury or by Neogen or Merger Sub, which shares will be canceled and cease to exist, with no consideration being delivered in exchange therefor at the effective time of the Merger |
| | ||
Merger Sub | | | Nova RMT Sub, Inc., a wholly owned subsidiary of Neogen |
| | ||
Neogen | | | Neogen Corporation |
| | ||
Neogen board | | | The board of directors of Neogen |
| | ||
Neogen board recommendation | | | The Neogen board’s recommendation to Neogen shareholders to approve the Share Issuance, the Neogen Charter Amendment Proposal and the Neogen Bylaw Board Size Proposal. |
| | ||
Neogen Bylaw Board Size Proposal | | | The proposal to approve the amendment of Neogen’s bylaws to increase the maximum number of directors that may comprise the board of directors of Neogen from nine directors to eleven directors |
| | ||
Neogen Charter Amendment Proposal | | | The proposal to approve the amendment of Neogen’s Restated Articles of Incorporation, as amended, to (i) increase the number of authorized shares of Neogen common stock from 240,000,000 shares of Neogen common stock to 315,000,000 shares of Neogen common stock and (ii) increase the maximum number of directors on the Neogen board of directors from nine directors to eleven directors |
| | ||
Neogen common stock | | | The common stock, par value $0.16 per share, of Neogen |
| | ||
Neogen Group | | | Neogen and its subsidiaries, other than the SpinCo Group |
| | ||
Nasdaq | | | Nasdaq Global Select Market |
| | ||
Notes | | | 8.625% Senior Notes due 2030 issued by Garden SpinCo |
| | ||
Permanent Financing | | | Debt securities (including the SpinCo Exchange Debt) or any other long-term debt financing issued or incurred by Garden SpinCo (or its designee) in lieu of the Financing, expected to be comprised of the Notes in the aggregate principal amount of $350.0 million and the term loan in the aggregate principal amount of $650.0 million under the Senior Secured Credit Agreement |
| | ||
Reorganization | | | The steps taken to effect the separation of the Food Safety Business from the 3M Business, as set forth in the Separation Agreement and the other applicable transaction documents, including the steps set forth in the Separation Step Plan, and (a) the Contribution, (b) the actual or deemed issuance by Garden SpinCo to 3M of shares of Garden SpinCo common stock, (c) the distribution by Garden SpinCo to 3M of the SpinCo Cash Payment and (d) any issuance by Garden SpinCo to 3M of the SpinCo Exchange Debt |
Abbreviation/Term | | | Definition |
Senior Secured Credit Agreement | | | The Credit Agreement, dated as of June 30, 2022, among Garden SpinCo, the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (as it may be amended, restated, supplemented, or otherwise modified from time to time) |
| | ||
Separation | | | The Distribution and the Reorganization |
| |
separately conveyed assets | | | All assets proposed to be transferred, assigned, sold or conveyed to the SpinCo Group, Neogen or any affiliate of Neogen, pursuant to the transactions contemplated by the separate conveyancing instruments (as defined in the Separation Agreement, and including the Asset Purchase Agreement) |
| | ||
Separation Agreement | | | The Separation and Distribution Agreement, dated as of December 13, 2021, by and among 3M, Garden SpinCo and Neogen (as it may be amended from time to time) |
| | ||
Separation Step Plan | | | The plan and structure exchanged between the parties to effect the separation of the Food Safety Business from the 3M Business (as it may be amended from time to time) |
| | ||
Share Issuance | | | The issuance of Neogen common stock in connection with the Merger |
| | ||
Share Issuance Proposal | | | The proposal to approve the Share Issuance |
| | ||
SpinCo Cash Payment | | | The cash payment to be paid by Garden SpinCo to 3M prior to the Distribution, in an amount to be calculated as set forth in the Separation Agreement |
| | ||
SpinCo Exchange Debt | | | |
| | ||
SpinCo Group | | | Garden SpinCo, each subsidiary of Garden SpinCo immediately after the Distribution Time and each other entity that becomes a subsidiary of Garden SpinCo after the Distribution Time |
| | ||
Tax Matters Agreement | | | The Tax Matters Agreement, to be entered into as of the Closing, by and among 3M, Garden SpinCo and Neogen (as it may be amended from time to time) |
| | ||
Transaction Documents | | | The Merger Agreement, the Separation Agreement, the Asset Purchase Agreement, the Employee Matters Agreement, the Tax Matters Agreement and the other agreements described herein |
| | ||
Transactions | | | The transactions contemplated by the Merger Agreement, the Separation Agreement, the Asset Purchase Agreement and the other Transaction Documents |
Q: | Who may participate in this Exchange Offer? |
A: | Any U.S. holders of 3M common stock during the period this Exchange Offer is open may participate in this Exchange Offer. This includes shares of 3M common stock represented by units in the 3M stock fund held for the account of participants in the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and 3M Savings Plan (together, the “3M Savings Plans”) in accordance with the terms of such plans. Although 3M has mailed this prospectus to its stockholders to the extent required by U.S. law, including stockholders located outside the United States, this prospectus is not an offer to buy, sell or exchange and it is not a solicitation of an offer to buy or sell any shares of 3M common stock, shares of Neogen common stock or shares of Garden SpinCo common stock in any jurisdiction in which such offer, sale or exchange is not permitted. Countries outside the United States generally have their own legal requirements that govern securities offerings made to persons resident in those countries and often impose stringent requirements about the form and content of offers made to the general public. None of 3M, Neogen or Garden SpinCo has taken any action under non-U.S. regulations to facilitate a public offer to exchange the shares of 3M common stock, shares of Neogen common stock or shares of Garden SpinCo common stock outside the United States. Accordingly, the ability of any non-U.S. person to tender shares of 3M common stock in this Exchange Offer will depend on whether there is an exemption available under the laws of such person’s home country that would permit the person to participate in this Exchange Offer without the need for 3M, Neogen or Garden SpinCo to take any action to facilitate a public offering in that country or otherwise. For example, some countries exempt transactions from the rules governing public offerings if they involve persons who meet certain eligibility requirements relating to their status as sophisticated or professional investors. |
Q: | How many shares of Garden SpinCo common stock will I receive for each share of 3M common stock that I tender? |
A: | This Exchange Offer is designed to permit you to exchange your shares of 3M common stock for shares of Garden SpinCo common stock at a price per share equal to a |
Q: | Is there a limit on the number of shares of Garden SpinCo common stock I can receive for each share of 3M common stock that I tender? |
A: | The number of shares you can receive in this Exchange Offer is subject to an upper limit of |
Q: | How and when will I know if the upper limit is in effect? |
A: | 3M will announce whether the upper limit on the number of shares that can be received for each share of 3M common stock tendered and accepted for exchange will be in effect at the expiration of this Exchange Offer, through |
Q: | How are the calculated per-share values of 3M common stock and Neogen common stock determined for purposes of calculating the number of shares of Garden SpinCo common stock to be received in this Exchange Offer? |
A: | The calculated per-share value of 3M common stock and Neogen common stock for purposes of this Exchange Offer will equal the simple arithmetic average of the daily VWAP of 3M common stock and Neogen common stock on the NYSE and Nasdaq, respectively, on each of the Valuation Dates. 3M will determine such calculations of the per-share values of 3M common stock and Neogen common stock and such determination will be final. |
Q: | What is the “daily volume-weighted average price” or “daily VWAP”? |
A: | The “daily volume-weighted average price” for 3M common stock will be the volume-weighted average price of 3M common stock on the NYSE and the “daily volume-weighted average price” for Neogen |
Q: | Where can I find the daily VWAP of 3M common stock and Neogen common stock during the period this Exchange Offer is open? |
A: | 3M will maintain a website at |
Q: | Why is the calculated per-share value for Garden SpinCo common stock based on the trading prices for Neogen common stock? |
A: | There is currently no trading market for Garden SpinCo common stock. 3M believes, however, that the trading prices for Neogen common stock are an appropriate proxy for the trading prices of Garden SpinCo common stock because (i) in the Merger, each outstanding share of Garden SpinCo common stock (except for the Merger Excluded Shares) will be converted into the right to receive a number of fully paid and nonassessable shares of Neogen common stock equal to the Exchange Ratio, which is calculated under the Merger Agreement such that immediately following the Merger, Garden SpinCo stockholders will own, in the aggregate, approximately 50.1% of the issued and outstanding shares of Neogen common stock and pre-Merger Neogen shareholders will own, in the aggregate, approximately 49.9% of the issued and outstanding Neogen common stock, (ii) prior to the consummation of this Exchange Offer, 3M will cause the total number of shares of Garden SpinCo common stock outstanding immediately prior to the Distribution to be that number that results in the Exchange Ratio equaling one and, as a result, each share of Garden SpinCo common stock (except for the Merger Excluded Shares) will be converted into one share of Neogen common stock in the Merger, and (iii) at the Valuation Dates, it is expected that the Merger will be expected to be consummated shortly, such that investors should be expected to be valuing Neogen common stock based on the expected value of such Neogen common stock immediately after the Merger. There can be no assurance, however, that Neogen common stock after the Merger will trade on the same basis or same level as Neogen common stock trades prior to the Merger. See “Risk Factors—Risks Related to the Transactions—The trading prices of Neogen common stock may not be an appropriate proxy for the prices of Garden SpinCo common stock.” |
Q: | How and when will I know the final exchange ratio? |
A: | The final exchange ratio showing the number of shares of Garden SpinCo common stock that you will receive for each share of your 3M common stock accepted for exchange in this Exchange Offer will be |
Q: | Will indicative exchange ratios be provided during this Exchange Offer? |
A: | Yes. Indicative exchange ratios will be available commencing after the close of trading on the third trading day of this Exchange Offer by contacting the information agent at the toll-free number provided on the back cover of this prospectus and at |
Q: | What if 3M common stock or Neogen common stock does not trade on any of the Valuation Dates? |
A: | If a market disruption event, as defined below, occurs with respect to 3M common stock or Neogen common stock on any of the Valuation Dates, the calculated per-share value of 3M common stock and per-share value of Garden SpinCo common stock will be determined using the daily VWAP of shares of 3M common stock and shares of Neogen common stock on the preceding full trading day or days, as the case may be, on which no market disruption event occurred with respect to either 3M common stock and Neogen common stock. If, however, a market disruption event occurs as specified above, 3M may terminate or extend this Exchange Offer if, in its reasonable judgment, the market disruption event has impaired the benefits of this Exchange Offer to 3M. For specific information as to what would constitute a market disruption event, see “Exchange Offer—Conditions to Consummation of This Exchange Offer.” |
Q: | Are there circumstances under which I would receive fewer shares of Garden SpinCo common stock than I would have received if the exchange ratio were determined using the closing prices of 3M common stock and Neogen common stock on the expiration date of this Exchange Offer? |
A: | Yes. For example, if the trading price of 3M common stock were to increase during the period of the Valuation Dates or after the date the exchange ratio is set, the calculated per-share value of 3M common stock would likely be lower than the closing price of 3M common stock on the last full trading day prior to the expiration date of this Exchange Offer. As a result, you would receive fewer shares of Garden SpinCo common stock for each $100 of 3M common stock than you would have received if that per-share value were calculated on the basis of the closing price of 3M common stock on the last full trading day prior to the expiration date of this Exchange Offer. Similarly, if the trading price of Neogen common stock were to decrease during the period of the Valuation Dates or after the date the exchange ratio is set, the calculated per-share value of Garden SpinCo common stock would likely be higher than the closing price of Neogen |
Q: | Will fractional shares of Garden SpinCo common stock and fractional shares of Neogen common stock be distributed? |
A: | Fractional shares of Garden SpinCo common stock will be issued in the Distribution. The shares of Garden SpinCo common stock (including the fractional shares) will be held by |
Q: | What is the aggregate number of shares of Garden SpinCo common stock being offered in this Exchange Offer? |
A: | In this Exchange Offer, 3M is offering to exchange all of the shares of Garden SpinCo common stock held by it. 3M intends to cause the total number of shares of Garden SpinCo common stock outstanding immediately prior to the Distribution to be that number of shares that results in the Exchange Ratio equaling one. 3M currently expects that approximately |
Q: | What happens if not enough shares of 3M common stock are tendered to allow 3M to exchange all of the shares of Garden SpinCo common stock it holds? |
A: | If this Exchange Offer is consummated but less than all shares of Garden SpinCo common stock are exchanged because this Exchange Offer is not fully subscribed, the additional shares of Garden SpinCo common stock owned by 3M will be distributed in a Clean-Up Spin-Off. The record date for the Clean-Up Spin-Off, if any, will be announced by 3M. Any 3M stockholder who validly tenders (and does not properly withdraw) shares of 3M common stock that are accepted for exchange in this Exchange Offer will, with respect to such exchange shares, waive their rights to receive, and forfeit any rights to, shares of Garden SpinCo common stock in the Clean-Up Spin-Off. See “Exchange Offer—Distribution of Garden SpinCo Common Stock Remaining After This Exchange Offer.” |
Q: | What happens if 3M declares a dividend during this Exchange Offer? |
A: | If 3M declares a dividend and the record date for that dividend occurs during this Exchange Offer, you will be eligible to receive that dividend if you continue to own your shares of 3M common stock as of that record date. |
Q: | Will tendering my shares affect my ability to receive the 3M quarterly dividend? |
A: | No, unless your shares are accepted for exchange. If a dividend is declared by 3M with a record date before the completion of this Exchange Offer, you will be entitled to that dividend even if you tendered your shares of 3M common stock. Tendering your shares of 3M common stock in this Exchange Offer is not a sale or transfer of |
Q: | Will all shares of 3M common stock that I tender be accepted for exchange in this Exchange Offer? |
A: | Not necessarily. Depending on the number of shares of 3M common stock validly tendered in this Exchange Offer and not properly withdrawn, the calculated per-share value of 3M common stock and the per-share value of Garden SpinCo common stock determined as described above, 3M may have to limit the number of shares of 3M common stock that it accepts for exchange in this Exchange Offer through a proration process. Any proration of the number of shares accepted for exchange in this Exchange Offer will be determined on the basis of the proration mechanics described in “Exchange Offer—Terms of This Exchange Offer—Proration; Tenders for Exchange by Holders of Fewer than 100 Shares of 3M Common Stock.” |
Q: | Will I be able to sell my shares of Garden SpinCo common stock after this Exchange Offer is completed? |
A: | No. There currently is no trading market for Garden SpinCo common stock and no such trading market will be established in the future. The Distribution Exchange Agent will hold all issued and outstanding shares of Garden SpinCo common stock in trust for the benefit of the tendering 3M stockholders until the shares of Garden SpinCo common stock are converted into the right to receive shares of Neogen common stock in the Merger. Participants in this Exchange Offer and any Clean-Up Spin-Off will not receive such shares of Garden SpinCo common stock, but will receive the shares of Neogen common stock issuable in the Merger, which can be sold in accordance with applicable securities laws. See “Exchange Offer—Distribution of Garden SpinCo Common Stock Remaining After This Exchange Offer.” |
Q: | How many shares of 3M common stock will 3M accept for exchange if this Exchange Offer is completed? |
A: | The number of shares of 3M common stock that will be accepted for exchange in this Exchange Offer if this Exchange Offer is completed will depend on the final exchange ratio, the number of shares of Garden SpinCo common stock offered and the number of shares of 3M common stock tendered. 3M currently expects that approximately |
Q: | Are there any conditions to 3M’s obligation to complete this Exchange Offer? |
A: | Yes. This Exchange Offer is subject to various conditions listed under “Exchange Offer—Conditions to Consummation of This Exchange Offer.” If any of these conditions are not satisfied or waived prior to the expiration of this Exchange Offer, 3M will not be required to accept shares for exchange and may extend or terminate this Exchange Offer. |
Q: | When does this Exchange Offer expire? |
A: | This Exchange Offer will expire, meaning the period during which you are permitted to tender your shares of 3M common stock in this Exchange Offer will end, at |
Q: | Can this Exchange Offer be extended and under what circumstances? |
A: | Yes. Subject to its compliance with the Merger Agreement and Separation Agreement, 3M can extend this Exchange Offer, in its sole discretion, at any time and from time to time. For instance, this Exchange Offer may be extended if any of the conditions to consummation of this Exchange Offer listed under “Exchange Offer—Conditions to Consummation of This Exchange Offer” are not satisfied or waived prior to the expiration of this Exchange Offer. In case of an extension of this Exchange Offer, 3M will publicly announce the extension no later than 9:00 a.m., New York City time, on the next business day following the previously scheduled expiration date. In addition, if the upper limit on the number of shares of Garden SpinCo common stock that can be received for each share of 3M common stock tendered and accepted for exchange is in effect, then the exchange ratio will be fixed at the upper limit. |
Q: | How do I participate in this Exchange Offer? |
A: | The procedures you must follow to participate in this Exchange Offer will depend on whether you hold your shares of 3M common stock in certificated form, through a bank, broker or other nominee, as a participant in any of the 3M Savings Plans, or if your shares of 3M common stock are held in book entry via the Direct Registration System and/or via the Dividend Reinvestment Plan, which we refer to collectively as |
Q: | How can I participate in this Exchange Offer if shares of 3M common stock are held for my account under a 3M 401(k) Savings Plan? |
A: | Shares of 3M common stock represented by units in the 3M stock fund held for the account of participants in the 3M Savings Plans are eligible for participation in this Exchange Offer. As applicable under the rules of each 3M Savings Plan, participants or the investment fiduciary of the 3M stock fund under such plan shall direct the trustee of such plan that all, some or none (or all or none in the case of participant directions) of the shares of 3M common stock represented by units in the 3M stock fund in the 3M Savings Plans be exchanged. After the Closing, if and to the extent any share are exchanged pursuant to the Exchange Offer, the applicable plan investment fiduciary may conclude that the applicable 3M Savings Plan will no longer hold Neogen stock, in which case the shares of Neogen common stock attributable to your account will be liquidated and the sale proceeds will be reallocated to one or more of the other investment options within the applicable 3M Savings Plan. |
Q: | Will holders of 3M stock options, stock appreciation rights or restricted stock units (“RSU”) have the opportunity to exchange their awards for Garden SpinCo common stock in this Exchange Offer? |
A: | No, holders of 3M stock options, stock appreciation rights or RSUs cannot tender the shares underlying such awards in this Exchange Offer. If you hold shares of 3M common stock as a result of the vesting and settlement of RSUs or as a result of the exercise of vested stock options, in each case, during this Exchange Offer, these shares can be tendered in this Exchange Offer. |
Q: | Can I tender only a portion of my shares of 3M common stock in this Exchange Offer? |
A: | Yes. You may tender all, some or none of your shares of 3M common stock. |
Q: | What do I do if I want to retain all of my shares of 3M common stock? |
A: | If you want to retain all of your shares of 3M common stock, you do not need to take any action. However, after the consummation of the Transactions, the Food Safety Business will no longer be owned by 3M, and as a holder of 3M common stock you will no longer hold shares in a company that owns the Food Safety Business (unless a Clean-Up Spin-Off is effected or unless this Exchange Offer is terminated and 3M effects a spin-off, in which case you also will receive shares of Neogen common stock in connection with the Merger). |
Q: | Can I change my mind after I tender my shares of 3M common stock and before this Exchange Offer expires? |
A: | Yes. You may withdraw your tendered shares at any time before this Exchange Offer expires. See “Exchange Offer—Terms of This Exchange Offer—Withdrawal Rights.” If you change your mind again, you can re-tender your shares of 3M common stock by following the tender procedures again prior to the expiration of this Exchange Offer. |
Q: | Are there any material differences between the rights of holders of 3M common stock and Neogen common stock? |
A: | Yes. 3M is a Delaware corporation and subject to the provisions of the DGCL. Neogen is a Michigan corporation and subject to the provisions of the MBCA. Each is subject to different organizational documents. Holders of 3M common stock, whose rights are currently governed by 3M’s organizational documents, will, with respect to the shares validly tendered and exchanged immediately following this Exchange Offer or shares of Garden SpinCo common stock received in any Clean-Up Spin-Off, become shareholders of Neogen and their rights will be governed by the MBCA and Neogen’s organizational documents. For a discussion of the material differences between the rights of holders of 3M common stock and Neogen common stock, see “Comparison of the Rights of |
Q: | Are there any appraisal rights for holders of shares of 3M common stock in connection with this Exchange Offer? |
A: | No. There are no appraisal rights available to holders of shares of 3M common stock under the DGCL in connection with this Exchange Offer. |
Q: | What will 3M do with the shares of 3M common stock that are tendered, and what is the impact of this Exchange Offer on 3M’s share count? |
A: | The shares of 3M common stock that are tendered in this Exchange Offer will be held as treasury stock by 3M unless and until retired or used for other purposes. Any shares of 3M common stock acquired by 3M in this Exchange Offer will reduce the total number of shares of 3M common stock outstanding, although 3M’s actual number of shares outstanding on a given date reflects a variety of factors such as option exercises. |
Q: | What will happen to any remaining shares of Garden SpinCo common stock owned by 3M in the Clean-Up Spin-Off following the consummation of this Exchange Offer? |
A: | In the event that this Exchange Offer is not fully subscribed, any remaining shares of Garden SpinCo common stock owned by 3M that are not exchanged in this Exchange Offer will be distributed on a pro rata basis to 3M stockholders whose shares of 3M common stock remain outstanding following the consummation of this Exchange Offer. Upon consummation of this Exchange Offer, 3M will deliver to the Distribution Exchange Agent (a) book-entry authorization representing all of the shares of Garden SpinCo common stock being exchanged in this Exchange Offer, with instructions to hold the shares of Garden SpinCo common stock as agent for the holders of shares of 3M common stock validly tendered and not properly withdrawn in this Exchange Offer and (b) in the case of a Clean-Up Spin-Off, if any, a book entry authorization representing all of the shares of Garden SpinCo common stock to be distributed in the spin-off with instructions to hold the shares as agent for 3M stockholders whose shares of 3M common stock remain |
Q: | If I tender some or all of my shares of 3M common stock in this Exchange Offer, will I receive any shares of Garden SpinCo common stock in the Clean-Up Spin-Off? |
A: | 3M stockholders who validly tender (and do not properly withdraw) shares of 3M common stock that are accepted for exchange in this Exchange Offer will, with respect to such shares, waive their rights to receive, and forfeit any rights to, shares of Garden SpinCo common stock distributed in the Clean-Up Spin-Off. However, in the event any of your tendered shares are not accepted for exchange in this Exchange Offer for any reason, or you do not tender all of your shares of 3M common stock, such shares that are not accepted for exchange or were not tendered would be entitled to receive shares of Garden SpinCo common stock in the Clean-Up Spin-Off. |
Q: | Whom do I contact for information regarding this Exchange Offer? |
A: | You may call the information agent, |
Q: | What are the transactions described in this prospectus? |
A: | References to the “Transactions” mean the transactions contemplated by the Merger Agreement, the Separation Agreement and the Asset Purchase Agreement. These agreements provide for, among other things: |
Q: | What will happen in the Separation? |
A: | Pursuant to the Separation Agreement, 3M and certain of 3M’s subsidiaries will engage in a series of transactions in which, among other things, (a) certain assets and liabilities related to the Food Safety |
Q: | What will happen in the Merger? |
A: | Pursuant to the Merger Agreement, in the Merger, Merger Sub will merge with Garden SpinCo, and Garden SpinCo will survive the Merger as a wholly owned subsidiary of Neogen. Following the effective time of the Merger, Neogen will continue to be a separately traded public company and will own and operate the combined businesses of Neogen and the Food Safety Business. At the effective time of the Merger, each issued and outstanding share of Garden SpinCo common stock (except for the Merger Excluded Shares) will be converted into the right to receive a number of fully paid and nonassessable shares of Neogen common stock equal to the Exchange Ratio. The Exchange Ratio is calculated under the Merger Agreement such that immediately following the Merger, Garden SpinCo stockholders will hold approximately 50.1% of the issued and outstanding shares of Neogen common stock and pre-Merger Neogen shareholders will hold approximately 49.9% of the issued and outstanding shares of Neogen’s common stock. |
Q: | What are 3M’s reasons for the Transactions? |
A: | In reaching a decision to proceed with the Transactions, the 3M board and 3M’s senior management considered, among other things, (i) the expected strategic and operational benefits of separating the Food Safety Business from 3M’s other businesses; (ii) the enhanced competitive position by combining complementary offerings that would be created through the combination of the Food Safety Business with Neogen; (iii) the belief of the 3M board that the Transactions reflect a compelling valuation for the Food Safety Business; (iv) the results of the due diligence review of Neogen’s business conducted by 3M’s management and advisors; (v) the fact that 3M stockholders would own approximately 50.1% of the combined company following the Merger and would have the opportunity to participate in any increase in the value of the shares of Neogen common stock following the effective time of the Merger; (vi) the 3M board’s view of the favorable anticipated financial profile of the combined company in the initial post-closing period; (vii) the fact that two individuals designated by 3M would become directors of the combined company upon the effective time of the Merger; (viii) the expectation that the Separation, the Distribution and the Merger generally would be tax-efficient for 3M and its stockholders; (ix) the potential synergies associated with a combination of Neogen and the Food Safety Business; and (x) the fact that 3M will receive the SpinCo Cash Payment and, as applicable, the SpinCo Exchange Debt in the Transactions, which may be used for debt reduction, dividends and/or share repurchases, as well as a variety of negative factors and risks associated with the Transactions. See “The Transactions—3M’s Reasons for the Transactions.” |
Q: | What are Neogen’s reasons for the Transactions? |
A: | In reaching its decision to approve the Transactions and resolving to recommend that Neogen shareholders approve the Share Issuance and the other matters to be considered at Neogen’s special meeting, the Neogen |
Q: | What is a Reverse Morris Trust transaction? |
A: | A Reverse Morris Trust transaction structure allows a parent company (in this case, 3M) to divest a subsidiary (in this case, Garden SpinCo) in a tax-efficient manner. The first step of such a transaction is a distribution of the subsidiary’s stock to the parent company stockholders (in this case, 3M’s distribution of the SpinCo common stock to 3M’s stockholders in the Distribution, which may be completed either by an Exchange Offer and a potential Clean-Up Spin-Off or a pro rata distribution of SpinCo common stock) in a transaction that is generally tax-free under Section 355 of the Code. The distributed subsidiary then combines with a third party (in this case, Merger Sub through the Merger). Such a transaction can qualify as generally tax-free for U.S. federal income tax purposes for the parent company and its stockholders if the transaction structure meets the applicable requirements, including that the parent company stockholders own more than 50% of the stock of the combined entity immediately after the business combination. For information about the material tax consequences resulting from the Transactions, see “Material U.S. Federal Income Tax Consequences of the Distribution and the Merger.” |
Q: | What will I receive in the Transactions? |
A: | In this Exchange Offer, 3M will offer to 3M stockholders the right to exchange all or a portion of their shares of 3M common stock for shares of Garden SpinCo common stock. In the event this Exchange Offer is not fully subscribed, 3M will distribute in the Clean-Up Spin-Off the remaining shares of Garden SpinCo common stock owned by 3M on a pro rata basis to 3M stockholders whose shares of 3M common stock remain outstanding after the consummation of this Exchange Offer. If this Exchange Offer is terminated by 3M without the exchange of shares (but the conditions to consummation of the Transactions have otherwise been satisfied), 3M intends to distribute all shares of Garden SpinCo common stock owned by 3M on a pro rata basis to holders of 3M common stock, with a record date to be announced by 3M. In the Merger, the shares of Garden SpinCo common stock will be converted into the right to receive shares of Neogen common stock. Thus, each Garden SpinCo stockholder will ultimately receive shares of Neogen common stock in the Merger. Garden SpinCo stockholders will not be required to pay for the shares of Garden SpinCo common stock distributed in the Clean-Up Spin-Off or the shares of Neogen common stock issued in the Merger. Garden SpinCo stockholders will receive from the Merger Exchange Agent cash in lieu of any fractional shares of Neogen common stock that such stockholders would have been entitled to receive (after aggregating all fractional shares that would otherwise have been issuable to such stockholder). The Merger Exchange Agent will aggregate all fractional shares that would otherwise be issuable to Garden SpinCo stockholders (after first aggregating all fractional shares to which any individual stockholder would otherwise be entitled) and will sell such shares on the open market at then-prevailing prices. The Merger Exchange Agent will make the net cash proceeds of such sales (after any tax withholding, brokerage charges, commissions and conveyance and similar taxes), available, without interest, to Garden SpinCo stockholders that would otherwise have been entitled to a fractional share of Neogen common stock, on a pro rata basis based on such stockholders’ respective fractional interests. |
Q: | What will Neogen shareholders receive in the Merger? |
A: | Neogen shareholders will not directly receive any consideration in the Merger. All shares of Neogen common stock issued and outstanding immediately before the Merger will remain issued and outstanding after the consummation of the Merger. Immediately after the Merger, pre-Merger Neogen shareholders will continue to own shares in Neogen, which will now hold the Food Safety Business, including Garden SpinCo, which will have become a wholly owned subsidiary of Neogen. |
Q: | What is the estimated total value of the consideration to be paid by Neogen to Garden SpinCo stockholders in the Transactions? |
A: | Based upon the reported closing price for Neogen common stock on Nasdaq of $40.12 per share on December 13, 2021, the last trading day before the announcement of the signing of the Merger Agreement, and the number of outstanding shares of Neogen common stock on that date, the estimated total value of the shares to be issued by Neogen to Garden SpinCo stockholders in the Merger (excluding applicable holders of the equity awards described below) would have been approximately $4.3 billion. Based upon the reported closing price for Neogen common stock on Nasdaq of |
Q: | Are there possible adverse effects on the value of Neogen common stock to be received by Garden SpinCo stockholders who participate in this Exchange Offer? |
A: | 3M stockholders that participate in this Exchange Offer will be exchanging their shares of 3M common stock for shares of Garden SpinCo common stock at a discount to the per-share value of Neogen common stock, subject to the upper limit. The existence of a discount, along with the Share Issuance, may negatively affect the market price of Neogen common stock. Neogen also expects to incur significant expenses related to the Transactions, including those related to legal, advisory, financing, printing and financial services fees and transaction and integration expenses. The incurrence of these costs may have an adverse impact on Neogen’s liquidity or operating results in the periods in which they are incurred. Neogen also will be required to devote a significant amount of time and attention to the process of integrating the operations of Neogen and the Food Safety Business. If Neogen is not able to effectively manage the process, Neogen’s business may suffer and its stock price may decline. In addition, the market price of Neogen common stock may decline as a result of sales of a large number of shares of Neogen common stock in the market after the consummation of the Transactions or even the perception that these sales could occur. See “Risk Factors” for a further discussion of the material risks associated with the Transactions. |
Q: | Will Garden SpinCo make any payments to 3M in connection with the Separation? |
A: | In connection with the Separation, Garden SpinCo will make a cash payment, which we refer to as the SpinCo Cash Payment, to 3M of an amount of cash (not to be less than $465 million) determined in relation to the aggregate adjusted bases of the assets transferred to Garden SpinCo, subject to a customary net working capital adjustment. In addition, Neogen will make a cash payment to 3M of approximately $181 million in accordance with the transactions contemplated by the Asset Purchase Agreement, and Garden SpinCo |
Q: | How will the Transactions impact the future liquidity and capital resources of Neogen? |
A: | In connection with entry into the Merger Agreement, Garden SpinCo entered into the Debt Commitment Letter with the Commitment Parties. The Debt Commitment Letter will permit Garden SpinCo to incur borrowings in an aggregate principal amount of up to $1.0 billion (subject to certain conditions). In connection with the Transactions, Garden SpinCo expects to issue senior unsecured notes and/or to borrow loans under a senior secured term loan facility in an aggregate principal amount of up to $1.0 billion in lieu of borrowing under the financing arrangements contemplated by the Debt Commitment Letter in order to finance the SpinCo Cash Payment, complete the Debt Exchange, and fund the purchase price under the Asset Purchase Agreement. Neogen anticipates that, following the consummation of the Merger, its primary sources of liquidity for working capital and operating activities, including any future acquisitions, will |
Q: | What are the material U.S. federal income tax consequences to 3M stockholders resulting from the Distribution and the Merger? |
A: | The consummation of the Distribution (which includes this Exchange Offer) is conditioned upon, among other things, the receipt of the IRS Ruling and the Distribution Tax Opinion (as defined in “Material U.S. Federal Income Tax Consequences of the Distribution and the Merger—Treatment of the Distribution”). If 3M receives the IRS Ruling and the Distribution Tax Opinion to the effect that the Distribution, together with certain related transactions, qualifies as a “reorganization” for U.S. federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the “Code”), and the IRS Ruling and such tax opinion continue to be valid and in full force and effect, then, in general, for U.S. federal income tax purposes, no gain or loss will be recognized by, and no amount will be included in the income of, U.S. Holders (as defined in “Material U.S. Federal Income Tax Consequences of the Distribution and the Merger”) of 3M common stock upon the receipt of Garden SpinCo common stock in this Exchange Offer or in any Clean-Up Spin-Off (or if 3M determines not to consummate the Exchange Offer). |
Q: | Are there risks associated with the Transactions? |
A: | Yes. Neogen may not realize the expected benefits of the Transactions because of the risks and uncertainties discussed in the section entitled “Risk Factors” beginning on page |
Q: | Who will serve on the Neogen board following the closing of the Merger? |
A: | Immediately after the Merger, the Neogen board will consist of ten directors: the eight existing Neogen directors and two additional independent directors, reasonably acceptable to Neogen, who will be designated by 3M prior to Closing. The Neogen board is divided into three classes with staggered 3-year terms. Each of the 3M designees will be appointed to a different class on the Neogen board. See “The Transactions—Board of Directors and Executive Officers of Neogen Following the Merger; Operations Following the Merger” for more detailed information. |
Q: | Who will manage the business of Neogen after the Transactions? |
A: | The Neogen management team will continue to manage the business of Neogen following the Transactions. See “The Transactions—Board of Directors and Executive Officers of Neogen Following the Merger; Operations Following the Merger” for more detailed information. |
Q: | What shareholder approvals are needed in connection with the Transactions? |
A: | Neogen cannot complete the Transactions unless the Share Issuance Proposal is approved by the affirmative vote of a majority of the total votes cast by Neogen shareholders entitled to vote on the proposal at the Neogen special meeting. It is also a condition to the Merger that Neogen shareholders approve the Neogen Charter Amendment Proposal and Neogen Bylaw Board Size Proposal. No vote of 3M stockholders or Garden SpinCo stockholders following the Distribution is required or being sought in connection with the Transactions. |
Q: | Where will the Neogen shares issued in connection with the Merger be listed? |
A: | Neogen common stock is listed on Nasdaq under “NEOG.” The Neogen common stock will continue to be listed on Nasdaq following the completion of the Transactions. |
Q: | What is the current relationship between Garden SpinCo and Neogen? |
A: | Garden SpinCo is currently a wholly owned subsidiary of 3M and was formed as a Delaware corporation on December 10, 2021 to own and operate the Food Safety Business. Other than in connection with the Transactions, there is no relationship between Garden SpinCo and Neogen. |
Q: | When will the Transactions be completed? |
A: | The Transactions are expected to be completed in the third quarter of 2022, subject to receipt of Neogen shareholder approval, receipt of the IRS Ruling, and satisfaction of other customary closing conditions. |
Q: | Does Neogen have to pay a termination fee to 3M if the Share Issuance or any of the other transaction-related proposals are not approved by Neogen shareholders or if the Merger Agreement is otherwise terminated? |
A: | In specified circumstances, depending on the reasons for termination of the Merger Agreement, Neogen may be required to pay 3M a termination fee of $140 million. |
Q: | Does 3M have to pay a termination fee to Neogen or reimburse Neogen’s expenses if the Merger Agreement is terminated? |
A: | No. See “The Transaction Agreements—The Merger Agreement—Termination.” |
Q: | Is Garden SpinCo required to have a certain amount of cash in connection with the Merger? Is there an adjustment based on the working capital of Garden SpinCo? |
A: | The Separation Agreement provides that 3M will cause Garden SpinCo to have at least $3 million in cash or cash equivalents remaining in the business at the Separation effective time. The Separation Agreement also provides for a working capital adjustment. Based upon the actual amount of the net working capital of the Food Safety Business on the last calendar day of the month immediately preceding the Closing Date relative to an agreed upon target amount of net working capital, Garden SpinCo may be required to pay cash to 3M or 3M may be required to pay cash to Garden SpinCo. Any such adjustment will occur following the closing of the Merger and will not impact the number of shares of Neogen common stock to be issued in the Merger. See “The Transaction Agreements—The Separation Agreement—Consideration for the Transfer of Assets.” |
Q: | Will Neogen or Garden SpinCo incur indebtedness in connection with the Separation, the Distribution and the Merger? |
A: | Yes. In connection with the Transactions, Garden SpinCo |
Q: | Can Neogen, 3M or Garden SpinCo stockholders demand appraisal of their shares? |
A: | No. Neogen shareholders do not have appraisal rights under Michigan law in connection with the Transactions. Neither 3M nor Garden SpinCo stockholders have appraisal rights under Delaware law in connection with the Transactions. |
Q: | Who can answer my questions about the Transactions? |
A: | If you have any questions about the Transactions, please contact the information agent, |
3M Common Stock | | | Neogen Common Stock | | | Calculated Per-Share Value of 3M Common Stock (A) | | | Calculated Per- Share Value of Garden SpinCo Common Stock (Before the 7% Discount) (B) | | | Shares of Garden SpinCo Common Stock To Be Received Per Share of 3M Common Stock Tendered and Accepted for Exchange (the Exchange Ratio) (C) | | | Calculated Value Ratio (D) |
As of August 3, 2022 | | | As of August 3, 2022 | | | $142.8342 | | | $22.3143 | | | 6.8828 | | | 1.075 |
Down 10% | | | Up 10% | | | $128.5508 | | | $24.5457 | | | 5.6314 | | | 1.075 |
Down 10% | | | Unchanged | | | $128.5508 | | | $22.3143 | | | 6.1945 | | | 1.075 |
Down 10% | | | Down 10% | | | $128.5508 | | | $20.0829 | | | 6.8828 | | | 1.075 |
Unchanged | | | Up 10% | | | $142.8342 | | | $24.5457 | | | 6.2571 | | | 1.075 |
Unchanged | | | Down 10%(1)(2) | | | $142.8342 | | | $20.0829 | | | 7.3515 | | | 1.034 |
Up 10% | | | Up 10% | | | $157.1176 | | | $24.5457 | | | 6.8828 | | | 1.075 |
Up 10% | | | Unchanged(1)(3) | | | $157.1176 | | | $22.3143 | | | 7.3515 | | | 1.044 |
Up 10% | | | Down 10%(1)(4) | | | $157.1176 | | | $20.0829 | | | 7.3515 | | | 0.940 |
(A) | As of |
(B) | As of |
(C) | Equal to (i) the amount calculated as [A / (B* |
(D) | The calculated value ratio equals (i) the calculated per-share value of Garden SpinCo common stock (B) multiplied by the exchange ratio (C), divided by (ii) the calculated per-share value of 3M common stock (A), rounded to three decimal places. |
(1) | In this scenario, 3M would announce that the upper limit on the number of shares of Garden SpinCo common stock that can be received for each share of 3M common stock tendered is in effect no later than 11:59 p.m., New York City time, on the second trading day prior to the expiration date, and that the exchange ratio will be fixed at the upper limit. |
(2) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 7.6476 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. |
(3) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 7.5711 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. |
(4) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 8.4123 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. In this scenario, tendering 3M stockholders would receive less than $100 in value of Garden SpinCo common stock for each $100 in value of 3M common stock. |
(1) | Neogen, Garden SpinCo and 3M entered into an Employee Matters Agreement, which relates to, among other things, 3M’s, Garden SpinCo’s and Neogen’s obligations with respect to current and former employees of the Food Safety Business; |
(2) | Garden SpinCo and 3M will enter into several transition agreements, which we refer to as the Transition Arrangements, pursuant to which each party will, on a transitional basis, provide the other party with certain support services and other assistance after the Distribution and Merger; and |
(3) | Neogen, Garden SpinCo and 3M will enter into a Tax Matters Agreement, providing for, among other things, the allocation between 3M, on the one hand, and Garden SpinCo and Neogen, on the other hand, of certain rights and obligations with respect to tax matters. For a more complete discussion of the agreements related to the Transactions, see “The Transaction Agreements” and “Additional Agreements Related to the Separation, the Distribution and the Merger.” |
| | Years Ended December 31, | |||||||
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Statement of Income Data: | | | | | | | |||
Net sales | | | $368,388 | | | $336,764 | | | $337,088 |
Income before income taxes | | | 117,452 | | | 117,209 | | | 116,283 |
Net income | | | 93,732 | | | 91,972 | | | 91,778 |
| | As of December 31, | ||||
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Balance Sheet Data: | | | | | ||
Total assets | | | $202,516 | | | $195,853 |
Total equity | | | 185,017 | | | 180,012 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Statement of Income Data: | | | | | | | | | | | | | ||||||
Net sales | | | $368,388 | | | $336,764 | | | $337,088 | | | $91,621 | | | $85,517 | | | $374,492 |
Cost of sales | | | 143,348 | | | 127,027 | | | 121,302 | | | 36,229 | | | 32,116 | | | 147,461 |
Selling, general and administrative expenses | | | 82,403 | | | 71,698 | | | 78,776 | | | 22,111 | | | 19,964 | | | 84,550 |
Research, development and related expenses | | | 25,185 | | | 20,830 | | | 20,727 | | | 6,335 | | | 6,036 | | | 25,484 |
Total operating expenses | | | 250,936 | | | 219,555 | | | 220,805 | | | 64,675 | | | 58,116 | | | 257,495 |
Income before income taxes | | | 117,452 | | | 117,209 | | | 116,283 | | | 26,946 | | | 27,401 | | | 116,997 |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,812 |
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(In thousands of U.S. dollars) | | | As of December 31, | | | As of March 31, | |||
| 2021 | | | 2020 | | | 2022 | ||
Balance Sheet Data: | | | | | | | |||
Total assets | | | $202,516 | | | $195,853 | | | $206,117 |
Total equity | | | 185,017 | | | 180,012 | | | 189,923 |
(In thousands of U.S. dollars) | | | Years Ended December 31, | | | Three Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | ||
Statement of Cash Flow Data: | | | | | | | | | | | |||||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in investing activities | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in financing activities | | | (84,692) | | | (96,058) | | | (95,919) | | | (17,452) | | | (18,543) |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Other Financial Information: | | | | | | | | | | | | | ||||||
EBITDA(1) | | | $ 122,091 | | | $ 121,746 | | | $ 120,496 | | | $ 28,645 | | | $ 28,805 | | | $ 121,931 |
Adjusted EBITDA(1) | | | 123,274 | | | 122,968 | | | 121,782 | | | 29,408 | | | 29,428 | | | 123,254 |
Adjusted EBITDA margin (%)(1) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
Free cash flow(2) | | | 84,692 | | | 96,058 | | | 95,919 | | | 17,452 | | | 18,543 | | | 83,601 |
Free cash flow conversion (%)(2) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
(1) | Management of the Food Safety Business defines EBITDA as net income before interest expense, income taxes, and depreciation and amortization. Management of the Food Safety Business defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin (%)(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,813 |
Interest expenses | | | — | | | — | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 4,639 | | | 4,537 | | | 4,213 | | | 1,699 | | | 1,404 | | | 4,934 |
EBITDA | | | 122,091 | | | 121,746 | | | 120,496 | | | 28,645 | | | 28,805 | | | 121,931 |
Stock-based compensation(b) | | | 1,183 | | | 1,222 | | | 1,286 | | | 763 | | | 623 | | | 1,323 |
Adjusted EBITDA | | | $123,274 | | | $122,968 | | | $121,782 | | | $29,408 | | | $29,428 | | | $123,254 |
Adjusted EBITDA margin (%)(c) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(b) | The Food Safety Business’s stock-based compensation expense is reflected in cost of sales, selling, general and administrative expense and research, development and related expenses in its combined statements of income. |
(c) | Management of the Food Safety Business defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of net sales. |
(2) | Management of the Food Safety Business defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment provided by (PP&E). Management of the Food Safety Business defines free cash flow conversion as free cash flow as a percentage of net cash provided by operating activities. A reconciliation between net cash flow provided by operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 | | | $88,270 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) | | | (4,669) |
Free cash flow | | | $84,692 | | | $96,058 | | | $95,919 | | | $17,452 | | | $18,543 | | | $83,601 |
Free cash flow conversion (%) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
| | Years Ended December 31, | | | Three months ended March 31, | ||||||||||
(In millions of U.S. dollars, except per share data) | | | 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 |
Statement of Income Data: | | | | | | | | | | | |||||
Net sales | | | $35,355 | | | $32,184 | | | $32,136 | | | $8,829 | | | $8,851 |
Net income attributable to 3M | | | 5,921 | | | 5,449 | | | 4,517 | | | 1,299 | | | 1,624 |
Per share of 3M common stock: | | | | | | | | | | | |||||
Net income attributable to 3M – basic | | | $10.23 | | | $9.43 | | | $7.83 | | | $2.27 | | | $2.80 |
Net income attributable to 3M – diluted | | | $10.12 | | | $9.36 | | | $7.72 | | | $2.26 | | | $2.77 |
| | As of December 31, | | | As of March 31, | ||||
(In millions of U.S. dollars) | | | 2021 | | | 2020 | | | 2022 |
Balance Sheet Data: | | | | | | | |||
Total assets | | | $47,072 | | | $47,344 | | | $45,855 |
Long-term debt | | | $16,056 | | | $17,989 | | | 14,801 |
| | Years Ended December 31, | | | Six Months Ended June 30, | ||||||||||
(In millions of U.S. dollars, except per share data) | | | 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 |
Statement of Income Data: | | | | | | | | | | | |||||
Net sales | | | $35,355 | | | $32,184 | | | $32,136 | | | $17,531 | | | $17,801 |
Net income attributable to 3M | | | 5,921 | | | 5,449 | | | 4,517 | | | 1,377 | | | 3,148 |
Per share of 3M common stock: | | | | | | | | | | | |||||
Net income attributable to 3M – basic | | | $10.23 | | | $9.43 | | | $7.83 | | | $2.41 | | | $5.42 |
Net income attributable to 3M – diluted | | | $10.12 | | | $9.36 | | | $7.72 | | | $2.40 | | | $5.36 |
| | As of December 31, | | | As of June 30, | ||||
(In millions of U.S. dollars) | | | 2021 | | | 2020 | | | 2022 |
Balance Sheet Data: | | | | | | | |||
Total assets | | | $47,072 | | | $47,344 | | | $45,634 |
Long-term debt | | | $16,056 | | | $17,989 | | | $14,019 |
| | Years Ended May 31, | | | Nine Months Ended February 28, | ||||||||||
(In thousands of U.S. dollars, except per share data) | | | 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 |
Income Statement Data: | | | | | | | | | | | |||||
Total Revenues | | | $468,459 | | | $418,170 | | | $414,186 | | | $387,066 | | | $341,034 |
Operating Income | | | 74,169 | | | 67,523 | | | 68,094 | | | 40,591 | | | 53,914 |
Net Income | | | 60,882 | | | 59,475 | | | 60,176 | | | 33,348 | | | 45,122 |
Net Income per Share of Neogen Common Stock: | | | | | | | | | | | |||||
Basic(1) | | | $0.57 | | | $0.57 | | | $0.58 | | | $0.31 | | | $0.42 |
Diluted(1) | | | $0.57 | | | $0.56 | | | $0.57 | | | $0.31 | | | $0.42 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Income Statement Data: | | | | | | | | | ||||
Total Revenues | | | $527,159 | | | $468,459 | | | $418,170 | | | $514,491 |
Product Revenues | | | 424,664 | | | 376,302 | | | 335,539 | | | 414,715 |
Service Revenues | | | 102,495 | | | 92,157 | | | 82,631 | | | 99,776 |
Total Revenues | | | 527,159 | | | 468,459 | | | 418,170 | | | 514,491 |
Cost of Revenues: | | | | | | | | | ||||
Cost of product revenues | | | 228,017 | | | 201,348 | | | 173,566 | | | 223,662 |
Cost of service revenues | | | 56,129 | | | 52,055 | | | 48,325 | | | 55,124 |
Total Cost of Revenues | | | 284,146 | | | 253,403 | | | 221,891 | | | 278,786 |
Gross Margin | | | 243,013 | | | 215,056 | | | 196,279 | | | 235,705 |
Operating Expenses: | | | | | | | | | ||||
Sales & Marketing | | | 84,604 | | | 73,443 | | | 69,675 | | | 83,725 |
General & Administrative | | | 82,742 | | | 51,197 | | | 44,331 | | | 73,839 |
Research and Development | | | 17,049 | | | 16,247 | | | 14,750 | | | 17,295 |
Total Operating Expenses | | | 184,395 | | | 140,887 | | | 128,756 | | | 174,859 |
Operating Income | | | 58,618 | | | 74,169 | | | 67,523 | | | 60,846 |
Other Income: | | | | | | | | | ||||
Interest Income, Net | | | 1,267 | | | 1,614 | | | 5,992 | | | 784 |
Royalty Income | | | — | | | — | | | — | | | — |
Other, Net | | | 322 | | | (515) | | | (1,210) | | | (186) |
Total Other Income | | | 1,589 | | | 1,099 | | | 4,782 | | | 598 |
Income Before Income Taxes | | | 60,207 | | | 75,268 | | | 72,305 | | | 61,444 |
Provision for Income Taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Net Income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
Net Income per Share of Neogen Common Stock: | | | | | | | | | ||||
Basic(1) | | | $0.45 | | | $0.57 | | | $0.57 | | | |
Diluted(1) | | | $0.45 | | | $0.57 | | | $0.56 | | |
(1) | On June 4, 2021, Neogen effected a 2-for-1 stock split whereby Neogen’s shareholders of record as of May 26, 2021 received a dividend of one additional share of Neogen common stock for each share of Neogen common stock held. All per share amounts in the table above have been adjusted to reflect the stock split as if it had taken place at the beginning of the periods presented. |
(In thousands of U.S. dollars) | | | As of May 31, | |||
| 2022 | | | 2021 | ||
Balance Sheet Data: | | | | | ||
Total Assets | | | $992,929 | | | $920,192 |
Long-Term Debt | | | — | | | — |
Total Stockholders’ Equity | | | 887,374 | | | 840,377 |
| | As of May 31, | | | As of February 28, | ||||
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2022 |
Balance Sheet Data: | | | | | | | |||
Total Assets | | | $920,192 | | | $797,182 | | | $981,205 |
Long-Term Debt | | | — | | | — | | | — |
Total Stockholders’ Equity | | | 840,377 | | | 725,177 | | | 875,544 |
(In thousands of U.S. dollars) | | | Years Ended May 31, | ||||||
| 2022 | | | 2021 | | | 2020 | ||
Cash Flow Statement Data: | | | | | | | |||
Net Cash From Operating Activities | | | $68,038 | | | $81,089 | | | $85,878 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) |
Net Cash Used for Investing Activities | | | (97,229) | | | (105,564) | | | (88,785) |
Net Cash From Financing Activities | | | 6,813 | | | 33,544 | | | 29,405 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Other Financial Information: | | | | | | | | | ||||
EBITDA(1) | | | $82,634 | | | $94,695 | | | $84,709 | | | $84,427 |
Adjusted EBITDA(1) | | | 115,369 | | | 104,217 | | | 91,177 | | | 111,044 |
Adjusted EBITDA margin (%)(1) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
Free cash flow(2) | | | 43,609 | | | 54,377 | | | 61,826 | | | 50,407 |
Free cash flow conversion (%)(2) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(1) | Management of Neogen defines EBITDA as net income before interest, income taxes, depreciation and amortization. Management of Neogen defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation and certain transaction fees and expenses. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
Provision for income taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Interest income | | | (1,267) | | | (1,614) | | | (5,992) | | | (784) |
Interest expense | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 23,694 | | | 21,041 | | | 18,396 | | | 23,767 |
EBITDA | | | 82,634 | | | 94,695 | | | 84,709 | | | 84,427 |
Stock-based compensation(b) | | | 7,154 | | | 6,437 | | | 6,468 | | | 6,709 |
Certain transaction fees and expenses(c) | | | 25,581 | | | 3,085 | | | — | | | 19,908 |
Adjusted EBITDA | | | $115,369 | | | $104,217 | | | $91,177 | | | $111,044 |
Adjusted EBITDA margin (%)(d) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
(b) | Neogen’s stock-based compensation expense is reflected in general and administrative expense in its consolidated statements of income. |
(c) | Consists of legal, consultancy and other professional fees and expenses recognized in connection with the Transactions for the fiscal year ended May 31, 2022 and the twelve months ended February 28, 2022, amounts consist of legal, consultancy and other professional fees and expenses related to a transaction that did not ultimately close. |
(d) | Management of Neogen defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of total revenues. |
(2) | Management of Neogen defines free cash flow as net cash from operating activities less purchase of property, equipment and other non-current intangible assets. Management of Neogen defines free cash flow conversion as free cash flow as a percentage of net cash from operating activities. A reconciliation between net cash flow from operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net cash from operating activities | | | $68,038 | | | $81,089 | | | $85,878 | | | $69,617 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) | | | (19,210) |
Free cash flow | | | $43,609 | | | $54,377 | | | $61,826 | | | $50,407 |
Free cash flow conversion (%) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(in thousands) | | | As of |
Pro Forma Condensed Combined Balance Sheet: | | | |
Total assets | | | $ |
Long-term debt | | | $ |
Total liabilities | | | $ |
Total shareholders’ equity | | | $ |
(In thousands of U.S. dollars, except per share and % amounts) | | | Fiscal Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro Forma Condensed Combined Statements of Income: | | | | | ||
Total revenues | | | $901,651 | | | $888,984 |
Cost of revenues | | | 439,749 | | | 433,826 |
Gross margin | | | 461,902 | | | 455,158 |
Operating expenses | | | 510,909 | | | 457,755 |
Operating income (loss) | | | (49,007) | | | (2,597) |
Interest income | | | 1,267 | | | 784 |
Finance expense | | | (66,965) | | | (59,465) |
Other income (expense) | | | 322 | | | (186) |
Total other income (expense) | | | (65,376) | | | (58,867) |
Income (loss) before taxes | | | (114,383) | | | (61,464) |
Provision for Income Taxes | | | (22,023) | | | (12,142) |
Net Income (loss) | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Pro forma net (loss) attributable to common shareholders. | | | $(92,360) | | | $(49,322) |
Pro forma net (loss) per share of common stock – basic and diluted . | | | (0.43) | | | (0.23) |
Weighted average number of shares outstanding – basic and diluted | | | 215,954 | | | 215,918 |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
| | As of and for the | ||||
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Other Financial Information(1): | | | | | ||
Pro Forma EBITDA(2)(4) | | | 152,529 | | | 198,506 |
Pro Forma Adjusted EBITDA(3)(4) | | | 230,481 | | | 226,721 |
Pro Forma Adjusted EBITDA margin(3)(4) | | | 25.6% | | | 25.5% |
Pro Forma Net Debt(5) | | | 625,511 | | | 637,607 |
Ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA(3)(5)(6) | | | 2.7x | | | 2.8x |
Ratio of Pro Forma Adjusted EBITDA to pro forma finance expense(3)(7) | | | 3.4x | | | 3.8x |
(1) | See “Non-GAAP Financial Measures” for further details. |
(2) | Management of Neogen defines Pro Forma EBITDA as pro forma net income before pro forma interest, income taxes, and depreciation and amortization. |
(3) | Management of Neogen defines Pro Forma Adjusted EBITDA as Pro Forma EBITDA, adjusted for pro forma stock-based compensation and certain pro forma transaction fees and expenses. |
(4) | A reconciliation between pro forma net income, on one hand, and pro forma EBITDA and Pro Forma Adjusted EBITDA, on the other hand, is as follows: |
(in thousands, except per share amounts) | | | Fiscal year ended May 31, 2021 | | | Nine months ended February 28, 2022 |
Pro Forma Condensed Combined Statements of Income: | | | | | ||
Revenues | | | $819,107 | | | $669,937 |
Operating Income (expense) | | | $(29,641) | | | $2,597 |
Net income (loss) | | | $(67,471) | | | $(24,937) |
Pro forma net (loss) attributable to common shareholders | | | $(67,471) | | | $(24,937) |
Pro forma net (loss) per share of common stock – basic and diluted | | | $(0.31) | | | $(0.12) |
Weighted average number of shares outstanding – basic and diluted | | | 214,732 | | | 215,881 |
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro forma net income | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Provision for income taxes | | | (22,023) | | | (12,142) |
Interest | | | 65,698 | | | 58,681 |
Depreciation and amortization | | | 201,214 | | | 201,289 |
Pro Forma EBITDA | | | 152,529 | | | 198,506 |
Stock-based compensation | | | 8,764 | | | 8,307 |
Certain transaction fees and expenses | | | 69,188 | | | 19,908 |
Pro Forma Adjusted EBITDA | | | $230,481 | | | $226,721 |
Pro forma Adjusted EBITDA margin (%)(b) | | | 25.6% | | | 25.5% |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
(b) | Management of Neogen defines Pro Forma Adjusted EBITDA margin as Pro Forma Adjusted EBITDA as a percentage of pro forma total revenues. |
(5) | Management of Neogen defines pro forma net debt as pro forma long-term debt less pro forma cash and cash equivalents and marketable securities. |
(6) | The ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA is determined by dividing (i) Pro Forma Net Debt as of period end by (ii) Pro Forma Adjusted EBITDA for the twelve months then ended. |
(7) | The ratio of Pro Forma Adjusted EBITDA to pro forma finance expense is determined by dividing Pro Forma Adjusted EBITDA by pro forma finance expense. For each increase or decrease in assumed interest rates of 0.125% related to the assumed $650.0 million Term Loan Facility to be issued on a pro forma basis as part of the Transactions, annual interest expense would increase or decrease by approximately $0.8 million for the year ended May 31, 2022 and for the twelve months ended February 28, 2022. |
| | December 13, 2021 | |
Closing Sale Price Per Share of 3M Common Stock | | | $174.58 |
Closing Sale Price Per Share of Neogen Common Stock | | | $40.12 |
1. | with respect to 3M common stock, the simple arithmetic average of the daily VWAP of 3M common stock on the NYSE for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for |
2. | with respect to Garden SpinCo common stock, the simple arithmetic average of the daily VWAP of Neogen common stock on Nasdaq for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for |
(1) | Neogen, Garden SpinCo and 3M entered into an Employee Matters Agreement, which relates to, among other things, 3M’s, Garden SpinCo’s and Neogen’s obligations with respect to current and former employees of the Food Safety Business; |
(2) | Garden SpinCo and 3M will enter into several transition agreements, which we refer to as the Transition Arrangements, pursuant to which each party will, on a transitional basis, provide the other party with certain support services and other assistance after the Distribution and Merger; and |
(3) | Neogen, Garden SpinCo and 3M will enter into a Tax Matters Agreement, providing for, among other things, the allocation between 3M, on the one hand, and Garden SpinCo and Neogen, on the other hand, of certain rights and obligations with respect to tax matters. For a more complete discussion of the agreements related to the Transactions, see “The Transaction Agreements” and “Additional Agreements Related to the Separation, the Distribution and the Merger.” |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Statement of Income Data: | | | | | | | | | | | | | ||||||
Net sales | | | $368,388 | | | $336,764 | | | $337,088 | | | $91,621 | | | $85,517 | | | $374,492 |
Cost of sales | | | 143,348 | | | 127,027 | | | 121,302 | | | 36,229 | | | 32,116 | | | 147,461 |
Selling, general and administrative expenses | | | 82,403 | | | 71,698 | | | 78,776 | | | 22,111 | | | 19,964 | | | 84,550 |
Research, development and related expenses | | | 25,185 | | | 20,830 | | | 20,727 | | | 6,335 | | | 6,036 | | | 25,484 |
Total operating expenses | | | 250,936 | | | 219,555 | | | 220,805 | | | 64,675 | | | 58,116 | | | 257,495 |
Income before income taxes | | | 117,452 | | | 117,209 | | | 116,283 | | | 26,946 | | | 27,401 | | | 116,997 |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,812 |
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(In thousands of U.S. dollars) | | | As of December 31, | | | As of March 31, | |||
| 2021 | | | 2020 | | | 2022 | ||
Balance Sheet Data: | | | | | | | |||
Total assets | | | $202,516 | | | $195,853 | | | $206,117 |
Total equity | | | 185,017 | | | 180,012 | | | 189,923 |
(In thousands of U.S. dollars) | | | Years Ended December 31, | | | Three Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | ||
Statement of Cash Flow Data: | | | | | | | | | | | |||||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in investing activities | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in financing activities | | | (84,692) | | | (96,058) | | | (95,919) | | | (17,452) | | | (18,543) |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Other Financial Information: | | | | | | | | | | | | | ||||||
EBITDA(1) | | | $ 122,091 | | | $ 121,746 | | | $ 120,496 | | | $ 28,645 | | | $ 28,805 | | | $ 121,931 |
Adjusted EBITDA(1) | | | 123,274 | | | 122,968 | | | 121,782 | | | 29,408 | | | 29,428 | | | 123,254 |
Adjusted EBITDA margin (%)(1) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
Free cash flow(2) | | | 84,692 | | | 96,058 | | | 95,919 | | | 17,452 | | | 18,543 | | | 83,601 |
Free cash flow conversion (%)(2) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
(1) | Management of the Food Safety Business defines EBITDA as net income before interest expense, income taxes, and depreciation and amortization. Management of the Food Safety Business defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin (%)(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,813 |
Interest expenses | | | — | | | — | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 4,639 | | | 4,537 | | | 4,213 | | | 1,699 | | | 1,404 | | | 4,934 |
EBITDA | | | 122,091 | | | 121,746 | | | 120,496 | | | 28,645 | | | 28,805 | | | 121,931 |
Stock-based compensation(b) | | | 1,183 | | | 1,222 | | | 1,286 | | | 763 | | | 623 | | | 1,323 |
Adjusted EBITDA | | | $123,274 | | | $122,968 | | | $121,782 | | | $29,408 | | | $29,428 | | | $123,254 |
Adjusted EBITDA margin (%)(c) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(b) | The Food Safety Business’s stock-based compensation expense is reflected in cost of sales, selling, general and administrative expense and research, development and related expenses in its combined statements of income. |
(c) | Management of the Food Safety Business defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of net sales. |
(2) | Management of the Food Safety Business defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment provided by (PP&E). Management of the Food Safety Business defines free cash flow conversion as free cash flow as a percentage of net cash provided by operating activities. A reconciliation between net cash flow provided by operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 | | | $88,270 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) | | | (4,669) |
Free cash flow | | | $84,692 | | | $96,058 | | | $95,919 | | | $17,452 | | | $18,543 | | | $83,601 |
Free cash flow conversion (%) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
| | Years Ended December 31, | | | Six Months Ended June 30, | ||||||||||
(In millions of U.S. dollars, except per share data) | | | 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 |
Statement of Income Data: | | | | | | | | | | | |||||
Net sales | | | $35,355 | | | $32,184 | | | $32,136 | | | $17,531 | | | $17,801 |
Net income attributable to 3M | | | 5,921 | | | 5,449 | | | 4,517 | | | 1,377 | | | 3,148 |
Per share of 3M common stock: | | | | | | | | | | | |||||
Net income attributable to 3M – basic | | | $10.23 | | | $9.43 | | | $7.83 | | | $2.41 | | | $5.42 |
Net income attributable to 3M – diluted | | | $10.12 | | | $9.36 | | | $7.72 | | | $2.40 | | | $5.36 |
| | As of December 31, | | | As of June 30, | ||||
(In millions of U.S. dollars) | | | 2021 | | | 2020 | | | 2022 |
Balance Sheet Data: | | | | | | | |||
Total assets | | | $47,072 | | | $47,344 | | | $45,634 |
Long-term debt | | | $16,056 | | | $17,989 | | | $14,019 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Income Statement Data: | | | | | | | | | ||||
Total Revenues | | | $527,159 | | | $468,459 | | | $418,170 | | | $514,491 |
Product Revenues | | | 424,664 | | | 376,302 | | | 335,539 | | | 414,715 |
Service Revenues | | | 102,495 | | | 92,157 | | | 82,631 | | | 99,776 |
Total Revenues | | | 527,159 | | | 468,459 | | | 418,170 | | | 514,491 |
Cost of Revenues: | | | | | | | | | ||||
Cost of product revenues | | | 228,017 | | | 201,348 | | | 173,566 | | | 223,662 |
Cost of service revenues | | | 56,129 | | | 52,055 | | | 48,325 | | | 55,124 |
Total Cost of Revenues | | | 284,146 | | | 253,403 | | | 221,891 | | | 278,786 |
Gross Margin | | | 243,013 | | | 215,056 | | | 196,279 | | | 235,705 |
Operating Expenses: | | | | | | | | | ||||
Sales & Marketing | | | 84,604 | | | 73,443 | | | 69,675 | | | 83,725 |
General & Administrative | | | 82,742 | | | 51,197 | | | 44,331 | | | 73,839 |
Research and Development | | | 17,049 | | | 16,247 | | | 14,750 | | | 17,295 |
Total Operating Expenses | | | 184,395 | | | 140,887 | | | 128,756 | | | 174,859 |
Operating Income | | | 58,618 | | | 74,169 | | | 67,523 | | | 60,846 |
Other Income: | | | | | | | | | ||||
Interest Income, Net | | | 1,267 | | | 1,614 | | | 5,992 | | | 784 |
Royalty Income | | | — | | | — | | | — | | | — |
Other, Net | | | 322 | | | (515) | | | (1,210) | | | (186) |
Total Other Income | | | 1,589 | | | 1,099 | | | 4,782 | | | 598 |
Income Before Income Taxes | | | 60,207 | | | 75,268 | | | 72,305 | | | 61,444 |
Provision for Income Taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Net Income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
Net Income per Share of Neogen Common Stock: | | | | | | | | | ||||
Basic(1) | | | $0.45 | | | $0.57 | | | $0.57 | | | |
Diluted(1) | | | $0.45 | | | $0.57 | | | $0.56 | | |
(1) | On June 4, 2021, Neogen effected a 2-for-1 stock split whereby Neogen’s shareholders of record as of May 26, 2021 received a dividend of one additional share of Neogen common stock for each share of Neogen common stock held. All per share amounts in the table above have been adjusted to reflect the stock split as if it had taken place at the beginning of the periods presented. |
(In thousands of U.S. dollars) | | | As of May 31, | |||
| 2022 | | | 2021 | ||
Balance Sheet Data: | | | | | ||
Total Assets | | | $992,929 | | | $920,192 |
Long-Term Debt | | | — | | | — |
Total Stockholders’ Equity | | | 887,374 | | | 840,377 |
(In thousands of U.S. dollars) | | | Years Ended May 31, | ||||||
| 2022 | | | 2021 | | | 2020 | ||
Cash Flow Statement Data: | | | | | | | |||
Net Cash From Operating Activities | | | $68,038 | | | $81,089 | | | $85,878 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) |
Net Cash Used for Investing Activities | | | (97,229) | | | (105,564) | | | (88,785) |
Net Cash From Financing Activities | | | 6,813 | | | 33,544 | | | 29,405 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Other Financial Information: | | | | | | | | | ||||
EBITDA(1) | | | $82,634 | | | $94,695 | | | $84,709 | | | $84,427 |
Adjusted EBITDA(1) | | | 115,369 | | | 104,217 | | | 91,177 | | | 111,044 |
Adjusted EBITDA margin (%)(1) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
Free cash flow(2) | | | 43,609 | | | 54,377 | | | 61,826 | | | 50,407 |
Free cash flow conversion (%)(2) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(1) | Management of Neogen defines EBITDA as net income before interest, income taxes, depreciation and amortization. Management of Neogen defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation and certain transaction fees and expenses. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
Provision for income taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Interest income | | | (1,267) | | | (1,614) | | | (5,992) | | | (784) |
Interest expense | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 23,694 | | | 21,041 | | | 18,396 | | | 23,767 |
EBITDA | | | 82,634 | | | 94,695 | | | 84,709 | | | 84,427 |
Stock-based compensation(b) | | | 7,154 | | | 6,437 | | | 6,468 | | | 6,709 |
Certain transaction fees and expenses(c) | | | 25,581 | | | 3,085 | | | — | | | 19,908 |
Adjusted EBITDA | | | $115,369 | | | $104,217 | | | $91,177 | | | $111,044 |
Adjusted EBITDA margin (%)(d) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
(b) | Neogen’s stock-based compensation expense is reflected in general and administrative expense in its consolidated statements of income. |
(c) | Consists of legal, consultancy and other professional fees and expenses recognized in connection with the Transactions for the fiscal year ended May 31, 2022 and the twelve months ended February 28, 2022, amounts consist of legal, consultancy and other professional fees and expenses related to a transaction that did not ultimately close. |
(d) | Management of Neogen defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of total revenues. |
(2) | Management of Neogen defines free cash flow as net cash from operating activities less purchase of property, equipment and other non-current intangible assets. Management of Neogen defines free cash flow conversion as free cash flow as a percentage of net cash from operating activities. A reconciliation between net cash flow from operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net cash from operating activities | | | $68,038 | | | $81,089 | | | $85,878 | | | $69,617 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) | | | (19,210) |
Free cash flow | | | $43,609 | | | $54,377 | | | $61,826 | | | $50,407 |
Free cash flow conversion (%) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(in thousands) | | | As of May 31, 2022 |
Pro Forma Condensed Combined Balance Sheet: | | | |
Total assets | | | $4,848,000 |
Long-term debt | | | $986,688 |
Total liabilities | | | $1,617,381 |
Total shareholders’ equity | | | $3,230,619 |
(In thousands of U.S. dollars, except per share and % amounts) | | | Fiscal Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro Forma Condensed Combined Statements of Income: | | | | | ||
Total revenues | | | $901,651 | | | $888,984 |
Cost of revenues | | | 439,749 | | | 433,826 |
Gross margin | | | 461,902 | | | 455,158 |
Operating expenses | | | 510,909 | | | 457,755 |
Operating income (loss) | | | (49,007) | | | (2,597) |
Interest income | | | 1,267 | | | 784 |
Finance expense | | | (66,965) | | | (59,465) |
Other income (expense) | | | 322 | | | (186) |
Total other income (expense) | | | (65,376) | | | (58,867) |
Income (loss) before taxes | | | (114,383) | | | (61,464) |
Provision for Income Taxes | | | (22,023) | | | (12,142) |
Net Income (loss) | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Pro forma net (loss) attributable to common shareholders. | | | $(92,360) | | | $(49,322) |
Pro forma net (loss) per share of common stock – basic and diluted . | | | (0.43) | | | (0.23) |
Weighted average number of shares outstanding – basic and diluted | | | 215,954 | | | 215,918 |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
| | As of and for the | ||||
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Other Financial Information(1): | | | | | ||
Pro Forma EBITDA(2)(4) | | | 152,529 | | | 198,506 |
Pro Forma Adjusted EBITDA(3)(4) | | | 230,481 | | | 226,721 |
Pro Forma Adjusted EBITDA margin(3)(4) | | | 25.6% | | | 25.5% |
Pro Forma Net Debt(5) | | | 625,511 | | | 637,607 |
Ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA(3)(5)(6) | | | 2.7x | | | 2.8x |
Ratio of Pro Forma Adjusted EBITDA to pro forma finance expense(3)(7) | | | 3.4x | | | 3.8x |
(1) | See “Non-GAAP Financial Measures” for further details. |
(2) | Management of Neogen defines Pro Forma EBITDA as pro forma net income before pro forma interest, income taxes, and depreciation and amortization. |
(3) | Management of Neogen defines Pro Forma Adjusted EBITDA as Pro Forma EBITDA, adjusted for pro forma stock-based compensation and certain pro forma transaction fees and expenses. |
(4) | A reconciliation between pro forma net income, on one hand, and pro forma EBITDA and Pro Forma Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro forma net income | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Provision for income taxes | | | (22,023) | | | (12,142) |
Interest | | | 65,698 | | | 58,681 |
Depreciation and amortization | | | 201,214 | | | 201,289 |
Pro Forma EBITDA | | | 152,529 | | | 198,506 |
Stock-based compensation | | | 8,764 | | | 8,307 |
Certain transaction fees and expenses | | | 69,188 | | | 19,908 |
Pro Forma Adjusted EBITDA | | | $230,481 | | | $226,721 |
Pro forma Adjusted EBITDA margin (%)(b) | | | 25.6% | | | 25.5% |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
(b) | Management of Neogen defines Pro Forma Adjusted EBITDA margin as Pro Forma Adjusted EBITDA as a percentage of pro forma total revenues. |
(5) | Management of Neogen defines pro forma net debt as pro forma long-term debt less pro forma cash and cash equivalents and marketable securities. |
(6) | The ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA is determined by dividing (i) Pro Forma Net Debt as of period end by (ii) Pro Forma Adjusted EBITDA for the twelve months then ended. |
(7) | The ratio of Pro Forma Adjusted EBITDA to pro forma finance expense is determined by dividing Pro Forma Adjusted EBITDA by pro forma finance expense. For each increase or decrease in assumed interest rates of 0.125% related to the assumed $650.0 million Term Loan Facility to be issued on a pro forma basis as part of the Transactions, annual interest expense would increase or decrease by approximately $0.8 million for the year ended May 31, 2022 and for the twelve months ended February 28, 2022. |
| | December 13, 2021 | |
Closing Sale Price Per Share of 3M Common Stock | | | $174.58 |
Closing Sale Price Per Share of Neogen Common Stock | | | $40.12 |
1. | with respect to 3M common stock, the simple arithmetic average of the daily VWAP of 3M common stock on the NYSE for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for “MMM UN<Equity> AQR.” |
2. | with respect to Garden SpinCo common stock, the simple arithmetic average of the daily VWAP of Neogen common stock on Nasdaq for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for “NEOG UW<Equity> AQR.” |
(1) | Neogen, Garden SpinCo and 3M entered into an Employee Matters Agreement, which relates to, among other things, 3M’s, Garden SpinCo’s and Neogen’s obligations with respect to current and former employees of the Food Safety Business; |
(2) | Garden SpinCo and 3M will enter into several transition agreements, which we refer to as the Transition Arrangements, pursuant to which each party will, on a transitional basis, provide the other party with certain support services and other assistance after the Distribution and Merger; and |
(3) | Neogen, Garden SpinCo and 3M will enter into a Tax Matters Agreement, providing for, among other things, the allocation between 3M, on the one hand, and Garden SpinCo and Neogen, on the other hand, of certain rights and obligations with respect to tax matters. For a more complete discussion of the agreements related to the Transactions, see “The Transaction Agreements” and “Additional Agreements Related to the Separation, the Distribution and the Merger.” |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Statement of Income Data: | | | | | | | | | | | | | ||||||
Net sales | | | $368,388 | | | $336,764 | | | $337,088 | | | $91,621 | | | $85,517 | | | $374,492 |
Cost of sales | | | 143,348 | | | 127,027 | | | 121,302 | | | 36,229 | | | 32,116 | | | 147,461 |
Selling, general and administrative expenses | | | 82,403 | | | 71,698 | | | 78,776 | | | 22,111 | | | 19,964 | | | 84,550 |
Research, development and related expenses | | | 25,185 | | | 20,830 | | | 20,727 | | | 6,335 | | | 6,036 | | | 25,484 |
Total operating expenses | | | 250,936 | | | 219,555 | | | 220,805 | | | 64,675 | | | 58,116 | | | 257,495 |
Income before income taxes | | | 117,452 | | | 117,209 | | | 116,283 | | | 26,946 | | | 27,401 | | | 116,997 |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,812 |
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(In thousands of U.S. dollars) | | | As of December 31, | | | As of March 31, | |||
| 2021 | | | 2020 | | | 2022 | ||
Balance Sheet Data: | | | | | | | |||
Total assets | | | $202,516 | | | $195,853 | | | $206,117 |
Total equity | | | 185,017 | | | 180,012 | | | 189,923 |
(In thousands of U.S. dollars) | | | Years Ended December 31, | | | Three Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | ||
Statement of Cash Flow Data: | | | | | | | | | | | |||||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in investing activities | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) |
Net cash used in financing activities | | | (84,692) | | | (96,058) | | | (95,919) | | | (17,452) | | | (18,543) |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Other Financial Information: | | | | | | | | | | | | | ||||||
EBITDA(1) | | | $ 122,091 | | | $ 121,746 | | | $ 120,496 | | | $ 28,645 | | | $ 28,805 | | | $ 121,931 |
Adjusted EBITDA(1) | | | 123,274 | | | 122,968 | | | 121,782 | | | 29,408 | | | 29,428 | | | 123,254 |
Adjusted EBITDA margin (%)(1) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
Free cash flow(2) | | | 84,692 | | | 96,058 | | | 95,919 | | | 17,452 | | | 18,543 | | | 83,601 |
Free cash flow conversion (%)(2) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
(1) | Management of the Food Safety Business defines EBITDA as net income before interest expense, income taxes, and depreciation and amortization. Management of the Food Safety Business defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net income | | | $93,732 | | | $91,972 | | | $91,778 | | | $21,296 | | | $21,843 | | | $93,185 |
Net income margin (%)(a) | | | 25.4% | | | 27.3% | | | 27.2% | | | 23.2% | | | 25.5% | | | 24.9% |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 | | | 5,650 | | | 5,558 | | | 23,813 |
Interest expenses | | | — | | | — | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 4,639 | | | 4,537 | | | 4,213 | | | 1,699 | | | 1,404 | | | 4,934 |
EBITDA | | | 122,091 | | | 121,746 | | | 120,496 | | | 28,645 | | | 28,805 | | | 121,931 |
Stock-based compensation(b) | | | 1,183 | | | 1,222 | | | 1,286 | | | 763 | | | 623 | | | 1,323 |
Adjusted EBITDA | | | $123,274 | | | $122,968 | | | $121,782 | | | $29,408 | | | $29,428 | | | $123,254 |
Adjusted EBITDA margin (%)(c) | | | 33.5% | | | 36.5% | | | 36.1% | | | 32.1% | | | 34.4% | | | 32.9% |
(a) | Management of the Food Safety Business defines net income margin as net income as a percentage of net sales. |
(b) | The Food Safety Business’s stock-based compensation expense is reflected in cost of sales, selling, general and administrative expense and research, development and related expenses in its combined statements of income. |
(c) | Management of the Food Safety Business defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of net sales. |
(2) | Management of the Food Safety Business defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment provided by (PP&E). Management of the Food Safety Business defines free cash flow conversion as free cash flow as a percentage of net cash provided by operating activities. A reconciliation between net cash flow provided by operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended December 31, | | | Three Months Ended March 31, | | | Twelve Months Ended March 31, | |||||||||
| 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 | | | 2022 | ||
Net cash provided by operating activities | | | $89,780 | | | $100,417 | | | $100,044 | | | $18,974 | | | $20,484 | | | $88,270 |
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) | | | (1,522) | | | (1,941) | | | (4,669) |
Free cash flow | | | $84,692 | | | $96,058 | | | $95,919 | | | $17,452 | | | $18,543 | | | $83,601 |
Free cash flow conversion (%) | | | 94.3% | | | 95.7% | | | 95.9% | | | 92.0% | | | 90.5% | | | 94.7% |
| | Years Ended December 31, | | | Six Months Ended June 30, | ||||||||||
(In millions of U.S. dollars, except per share data) | | | 2021 | | | 2020 | | | 2019 | | | 2022 | | | 2021 |
Statement of Income Data: | | | | | | | | | | | |||||
Net sales | | | $35,355 | | | $32,184 | | | $32,136 | | | $17,531 | | | $17,801 |
Net income attributable to 3M | | | 5,921 | | | 5,449 | | | 4,517 | | | 1,377 | | | 3,148 |
Per share of 3M common stock: | | | | | | | | | | | |||||
Net income attributable to 3M – basic | | | $10.23 | | | $9.43 | | | $7.83 | | | $2.41 | | | $5.42 |
Net income attributable to 3M – diluted | | | $10.12 | | | $9.36 | | | $7.72 | | | $2.40 | | | $5.36 |
| | As of December 31, | | | As of June 30, | ||||
(In millions of U.S. dollars) | | | 2021 | | | 2020 | | | 2022 |
Balance Sheet Data: | | | | | | | |||
Total assets | | | $47,072 | | | $47,344 | | | $45,634 |
Long-term debt | | | $16,056 | | | $17,989 | | | $14,019 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Income Statement Data: | | | | | | | | | ||||
Total Revenues | | | $527,159 | | | $468,459 | | | $418,170 | | | $514,491 |
Product Revenues | | | 424,664 | | | 376,302 | | | 335,539 | | | 414,715 |
Service Revenues | | | 102,495 | | | 92,157 | | | 82,631 | | | 99,776 |
Total Revenues | | | 527,159 | | | 468,459 | | | 418,170 | | | 514,491 |
Cost of Revenues: | | | | | | | | | ||||
Cost of product revenues | | | 228,017 | | | 201,348 | | | 173,566 | | | 223,662 |
Cost of service revenues | | | 56,129 | | | 52,055 | | | 48,325 | | | 55,124 |
Total Cost of Revenues | | | 284,146 | | | 253,403 | | | 221,891 | | | 278,786 |
Gross Margin | | | 243,013 | | | 215,056 | | | 196,279 | | | 235,705 |
Operating Expenses: | | | | | | | | | ||||
Sales & Marketing | | | 84,604 | | | 73,443 | | | 69,675 | | | 83,725 |
General & Administrative | | | 82,742 | | | 51,197 | | | 44,331 | | | 73,839 |
Research and Development | | | 17,049 | | | 16,247 | | | 14,750 | | | 17,295 |
Total Operating Expenses | | | 184,395 | | | 140,887 | | | 128,756 | | | 174,859 |
Operating Income | | | 58,618 | | | 74,169 | | | 67,523 | | | 60,846 |
Other Income: | | | | | | | | | ||||
Interest Income, Net | | | 1,267 | | | 1,614 | | | 5,992 | | | 784 |
Royalty Income | | | — | | | — | | | — | | | — |
Other, Net | | | 322 | | | (515) | | | (1,210) | | | (186) |
Total Other Income | | | 1,589 | | | 1,099 | | | 4,782 | | | 598 |
Income Before Income Taxes | | | 60,207 | | | 75,268 | | | 72,305 | | | 61,444 |
Provision for Income Taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Net Income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
Net Income per Share of Neogen Common Stock: | | | | | | | | | ||||
Basic(1) | | | $0.45 | | | $0.57 | | | $0.57 | | | |
Diluted(1) | | | $0.45 | | | $0.57 | | | $0.56 | | |
(1) | On June 4, 2021, Neogen effected a 2-for-1 stock split whereby Neogen’s shareholders of record as of May 26, 2021 received a dividend of one additional share of Neogen common stock for each share of Neogen common stock held. All per share amounts in the table above have been adjusted to reflect the stock split as if it had taken place at the beginning of the periods presented. |
(In thousands of U.S. dollars) | | | As of May 31, | |||
| 2022 | | | 2021 | ||
Balance Sheet Data: | | | | | ||
Total Assets | | | $992,929 | | | $920,192 |
Long-Term Debt | | | — | | | — |
Total Stockholders’ Equity | | | 887,374 | | | 840,377 |
(In thousands of U.S. dollars) | | | Years Ended May 31, | ||||||
| 2022 | | | 2021 | | | 2020 | ||
Cash Flow Statement Data: | | | | | | | |||
Net Cash From Operating Activities | | | $68,038 | | | $81,089 | | | $85,878 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) |
Net Cash Used for Investing Activities | | | (97,229) | | | (105,564) | | | (88,785) |
Net Cash From Financing Activities | | | 6,813 | | | 33,544 | | | 29,405 |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Other Financial Information: | | | | | | | | | ||||
EBITDA(1) | | | $82,634 | | | $94,695 | | | $84,709 | | | $84,427 |
Adjusted EBITDA(1) | | | 115,369 | | | 104,217 | | | 91,177 | | | 111,044 |
Adjusted EBITDA margin (%)(1) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
Free cash flow(2) | | | 43,609 | | | 54,377 | | | 61,826 | | | 50,407 |
Free cash flow conversion (%)(2) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(1) | Management of Neogen defines EBITDA as net income before interest, income taxes, depreciation and amortization. Management of Neogen defines Adjusted EBITDA as EBITDA, adjusted for stock-based compensation and certain transaction fees and expenses. A reconciliation between net income, on one hand, and EBITDA and Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net income | | | $48,307 | | | $60,882 | | | $59,475 | | | $49,108 |
Net income margin (%)(a) | | | 9.2% | | | 13.0% | | | 14.2% | | | 9.5% |
Provision for income taxes | | | 11,900 | | | 14,386 | | | 12,830 | | | 12,336 |
Interest income | | | (1,267) | | | (1,614) | | | (5,992) | | | (784) |
Interest expense | | | — | | | — | | | — | | | — |
Depreciation and amortization | | | 23,694 | | | 21,041 | | | 18,396 | | | 23,767 |
EBITDA | | | 82,634 | | | 94,695 | | | 84,709 | | | 84,427 |
Stock-based compensation(b) | | | 7,154 | | | 6,437 | | | 6,468 | | | 6,709 |
Certain transaction fees and expenses(c) | | | 25,581 | | | 3,085 | | | — | | | 19,908 |
Adjusted EBITDA | | | $115,369 | | | $104,217 | | | $91,177 | | | $111,044 |
Adjusted EBITDA margin (%)(d) | | | 21.9% | | | 22.2% | | | 21.8% | | | 21.6% |
(a) | Management of Neogen defines net income margin as net income as a percentage of total revenues. |
(b) | Neogen’s stock-based compensation expense is reflected in general and administrative expense in its consolidated statements of income. |
(c) | Consists of legal, consultancy and other professional fees and expenses recognized in connection with the Transactions for the fiscal year ended May 31, 2022 and the twelve months ended February 28, 2022, amounts consist of legal, consultancy and other professional fees and expenses related to a transaction that did not ultimately close. |
(d) | Management of Neogen defines Adjusted EBITDA margin as Adjusted EBITDA as a percentage of total revenues. |
(2) | Management of Neogen defines free cash flow as net cash from operating activities less purchase of property, equipment and other non-current intangible assets. Management of Neogen defines free cash flow conversion as free cash flow as a percentage of net cash from operating activities. A reconciliation between net cash flow from operating activities and free cash flow, and the calculation of free cash flow conversion, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Years Ended May 31, | | | Twelve Months Ended February 28, | ||||||
| 2022 | | | 2021 | | | 2020 | | | 2022 | ||
Net cash from operating activities | | | $68,038 | | | $81,089 | | | $85,878 | | | $69,617 |
Purchase of property, equipment and other non-current intangible assets | | | (24,429) | | | (26,712) | | | (24,052) | | | (19,210) |
Free cash flow | | | $43,609 | | | $54,377 | | | $61,826 | | | $50,407 |
Free cash flow conversion (%) | | | 64.1% | | | 67.1% | | | 72.0% | | | 72.4% |
(in thousands) | | | As of May 31, 2022 |
Pro Forma Condensed Combined Balance Sheet: | | | |
Total assets | | | $4,848,000 |
Long-term debt | | | $986,688 |
Total liabilities | | | $1,617,381 |
Total shareholders’ equity | | | $3,230,619 |
(In thousands of U.S. dollars, except per share and % amounts) | | | Fiscal Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro Forma Condensed Combined Statements of Income: | | | | | ||
Total revenues | | | $901,651 | | | $888,984 |
Cost of revenues | | | 439,749 | | | 433,826 |
Gross margin | | | 461,902 | | | 455,158 |
Operating expenses | | | 510,909 | | | 457,755 |
Operating income (loss) | | | (49,007) | | | (2,597) |
Interest income | | | 1,267 | | | 784 |
Finance expense | | | (66,965) | | | (59,465) |
Other income (expense) | | | 322 | | | (186) |
Total other income (expense) | | | (65,376) | | | (58,867) |
Income (loss) before taxes | | | (114,383) | | | (61,464) |
Provision for Income Taxes | | | (22,023) | | | (12,142) |
Net Income (loss) | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Pro forma net (loss) attributable to common shareholders. | | | $(92,360) | | | $(49,322) |
Pro forma net (loss) per share of common stock – basic and diluted . | | | (0.43) | | | (0.23) |
Weighted average number of shares outstanding – basic and diluted | | | 215,954 | | | 215,918 |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
| | As of and for the | ||||
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Other Financial Information(1): | | | | | ||
Pro Forma EBITDA(2)(4) | | | 152,529 | | | 198,506 |
Pro Forma Adjusted EBITDA(3)(4) | | | 230,481 | | | 226,721 |
Pro Forma Adjusted EBITDA margin(3)(4) | | | 25.6% | | | 25.5% |
Pro Forma Net Debt(5) | | | 625,511 | | | 637,607 |
Ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA(3)(5)(6) | | | 2.7x | | | 2.8x |
Ratio of Pro Forma Adjusted EBITDA to pro forma finance expense(3)(7) | | | 3.4x | | | 3.8x |
(1) | See “Non-GAAP Financial Measures” for further details. |
(2) | Management of Neogen defines Pro Forma EBITDA as pro forma net income before pro forma interest, income taxes, and depreciation and amortization. |
(3) | Management of Neogen defines Pro Forma Adjusted EBITDA as Pro Forma EBITDA, adjusted for pro forma stock-based compensation and certain pro forma transaction fees and expenses. |
(4) | A reconciliation between pro forma net income, on one hand, and pro forma EBITDA and Pro Forma Adjusted EBITDA, on the other hand, is as follows: |
(In thousands of U.S. dollars, except as specified) | | | Year Ended May 31, | | | Twelve Months Ended February 28, |
| 2022 | | | 2022 | ||
Pro forma net income | | | $(92,360) | | | $(49,322) |
Pro forma net income margin (%)(a) | | | (10.2)% | | | (5.5)% |
Provision for income taxes | | | (22,023) | | | (12,142) |
Interest | | | 65,698 | | | 58,681 |
Depreciation and amortization | | | 201,214 | | | 201,289 |
Pro Forma EBITDA | | | 152,529 | | | 198,506 |
Stock-based compensation | | | 8,764 | | | 8,307 |
Certain transaction fees and expenses | | | 69,188 | | | 19,908 |
Pro Forma Adjusted EBITDA | | | $230,481 | | | $226,721 |
Pro forma Adjusted EBITDA margin (%)(b) | | | 25.6% | | | 25.5% |
(a) | Management of Neogen defines pro forma net income margin as pro forma net income as a percentage of pro forma total revenues. |
(b) | Management of Neogen defines Pro Forma Adjusted EBITDA margin as Pro Forma Adjusted EBITDA as a percentage of pro forma total revenues. |
(5) | Management of Neogen defines pro forma net debt as pro forma long-term debt less pro forma cash and cash equivalents and marketable securities. |
(6) | The ratio of Pro Forma Net Debt to Pro Forma Adjusted EBITDA is determined by dividing (i) Pro Forma Net Debt as of period end by (ii) Pro Forma Adjusted EBITDA for the twelve months then ended. |
(7) | The ratio of Pro Forma Adjusted EBITDA to pro forma finance expense is determined by dividing Pro Forma Adjusted EBITDA by pro forma finance expense. For each increase or decrease in assumed interest rates of 0.125% related to the assumed $650.0 million Term Loan Facility to be issued on a pro forma basis as part of the Transactions, annual interest expense would increase or decrease by approximately $0.8 million for the year ended May 31, 2022 and for the twelve months ended February 28, 2022. |
| | December 13, 2021 | |
Closing Sale Price Per Share of 3M Common Stock | | | $174.58 |
Closing Sale Price Per Share of Neogen Common Stock | | | $40.12 |
1. | with respect to 3M common stock, the simple arithmetic average of the daily VWAP of 3M common stock on the NYSE for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for “MMM UN<Equity> AQR.” |
2. | with respect to Garden SpinCo common stock, the simple arithmetic average of the daily VWAP of Neogen common stock on Nasdaq for each of the Valuation Dates, as reported by Bloomberg L.P. through the Price and Volume Dashboard for “NEOG UW<Equity> AQR.” |
Number of shares of Garden SpinCo common stock | | | = | | | Number of shares of 3M common stock tendered and accepted for exchange, multiplied by the lesser of: | | | (a) 7.3515 (the upper limit) | | | and | | | (b) 100% of the calculated per-share value of 3M common stock divided by 93% of the calculated per-share value of Garden SpinCo common stock (calculated as described below) |
3M Common Stock | | | Neogen Common Stock | | | Calculated Per- Share Value of 3M Common Stock(A) | | | Calculated Per- Share Value of Garden SpinCo Common Stock (Before the 7% Discount)(B) | | | Shares of Garden SpinCo Common Stock To Be Received Per Share of 3M Common Stock Tendered and Accepted for Exchange (the Exchange Ratio)(C) | | | Calculated Value Ratio(D) |
As of August 3, 2022 | | | As of August 3, 2022 | | | $142.8342 | | | $22.3143 | | | 6.8828 | | | 1.075 |
Down 10% | | | Up 10% | | | $128.5508 | | | $24.5457 | | | 5.6314 | | | 1.075 |
Down 10% | | | Unchanged | | | $128.5508 | | | $22.3143 | | | 5.1945 | | | 1.075 |
Down 10% | | | Down 10% | | | $128.5508 | | | $20.0829 | | | 6.8828 | | | 1.075 |
Unchanged | | | Up 10% | | | $142.8342 | | | $24.5457 | | | 6.2571 | | | 1.075 |
Unchanged | | | Down 10%(1)(2) | | | $142.8342 | | | $20.0829 | | | 7.3515 | | | 1.034 |
Up 10% | | | Up 10% | | | $157.1176 | | | $24.5457 | | | 6.8828 | | | 1.075 |
Up 10% | | | Unchanged(1)(3) | | | $157.1176 | | | $22.3143 | | | 7.3515 | | | 1.044 |
Up 10% | | | Down 10%(1)(4) | | | $157.1176 | | | $20.0829 | | | 7.3515 | | | 0.940 |
(A) | As of August 3, 2022, the calculated per-share value of 3M common stock equals the simple arithmetic average of daily VWAPs on each of the three most recent prior trading dates ($143.1895, $142.1134 and $143.1997). |
(B) | As of August 3, 2022, the calculated per-share value of Garden SpinCo common stock equals the simple arithmetic average of daily Neogen VWAPs on each of the three most recent prior trading dates ($22.6622, $22.1371 and $22.1436). |
(C) | Equal to (i) the amount calculated as [A / (B*(1-7%))] or (ii) the upper limit, whichever is less. |
(D) | The calculated value ratio equals (i) the calculated per-share value of Garden SpinCo common stock (B) multiplied by the exchange ratio (C), divided by (ii) the calculated per-share value of 3M common stock (A), rounded to three decimal places. |
(1) | In this scenario, 3M would announce that the upper limit on the number of shares of Garden SpinCo common stock that can be received for each share of 3M common stock tendered is in effect no later than 11:59 p.m., New York City time, on the second trading day prior to the expiration date, and that the exchange ratio will be fixed at the upper limit. |
(2) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 7.6476 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. |
(3) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 7.5711 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. |
(4) | In this scenario, the upper limit is in effect. Absent the upper limit, the exchange ratio would have been 8.4123 shares of Garden SpinCo common stock per share of 3M common stock validly tendered and accepted in this Exchange Offer. In this scenario, tendering 3M stockholders would receive less than $100 in value of Garden SpinCo common stock for each $100 in value of 3M common stock. |
| |
• | Indicator testing – 3M™ PetrifilmTM brand products enable customers to detect organisms of interest to food processors using culture film plates (consumables) that are inoculated with samples collected from the food product environment. 3M™ PetrifilmTM Plates determine the presence and amount of a given organism in a sample, measured in colony-forming units (CFU) per gram or milliliter. Although a trained technician can manually count CFU results from the PetrifilmTM culture plates, CFU counting can be expedited by using the 3M™ PetrifilmTM Plate Reader Advanced, an automated CFU counter that reads several different types of 3M™ PetrifilmTM Plates rapidly. |
• | Hygiene monitoring – Hygiene monitoring products enable customers to verify the cleanliness of processing equipment and surfaces. The Food Safety Business’s hygiene monitoring solution consists of the Clean-TraceTM hand-held luminometer (hardware) and a single use Clean-TraceTM test device with sample collection swab (consumable). Customers can also use the Clean-TraceTM solution to organize and monitor testing results over time. The Clean-TraceTM test is typically used after cleaning and sanitizing procedures are performed and tests for the presence of adenosine triphosphate (ATP). Presence of ATP, an energy-carrying molecule found in the cells of all living things, would indicate incomplete cleaning. |
• | Pathogen detection – The 3MTM Molecular Detection System tests for the presence of pathogens. The system consists of hardware and consumables. The molecular detection system (MDS) combines isothermal DNA amplification and bioluminescence detection to provide faster results using simpler protocols and smaller equipment. |
• | Allergen testing – Allergen testing offerings enable the detection of allergenic compound proteins in the food production process. Allergen portfolio includes Enzyme-Linked Immunosorbent Assay (ELISA), Lateral Flow, and 3MTM Clean-TraceTM Surface Protein Test Swabs. |
| Patent Family Title | | | Product Category | | | Patent / Patent Application Number | | | Anticipated Expiration Date | | | Jurisdictions1 | |
| Culture Medium and Method for Detecting Thermonuclease-positive Staphylococci | | | Indicators | | | US787401 | | | 2/1/2024 | | | U.S. | |
| Biological Growth Plate Scanner with Automated Image Processing Profile Selection | | | Indicators | | | US7298885 | | | 1/28/2023 | | | U.S., Mexico | |
| Biological Growth Plate Scanner | | | Indicators | | | US8094916 | | | 11/27/2022 | | | U.S. | |
| Counting Biological Agents on Biological Growth Plates | | | Indicators | | | US7298886 | | | 11/4/2025 | | | U.S. | |
| US8260026 | | | 9/5/2023 | | |||||||||
| Biological Growth Plate Scanner with Automated Intake | | | Indicators | | | US7496225 | | | 3/16/2027 | | | U.S. | |
| System And Apparatus For Use In Detecting Microorganisms | | | Pathogen Detection | | | US7374951 | | | 5/11/2024 | | | U.S. | |
| Sampling Devices and Methods of Use | | | Hygiene Monitoring | | | US10845369 | | | 8/21/2031 | | | U.S., China, Germany, France, Japan | |
| Illumination Apparatus and Methods for a Biological Growth Plate Scanner | | | Indicators | | | US8840840 | | | 12/2/2030 | | | U.S., Germany, Japan (2), Korea | |
| Luminescence Detection Method | | | Pathogen Detection | | | US8852894 | | | 4/19/2032 | | | U.S., China, Germany, France, Great Britain, Japan | |
| US9845498 | | | 8/26/2032 | |
| Patent Family Title | | | Product Category | | | Patent / Patent Application Number | | | Anticipated Expiration Date | | | Jurisdictions1 | |
| Salmonella Detection Articles and Methods of Use | | | Pathogen Detection | | | US9593361 | | | 5/14/2032 | | | U.S., Brazil, China, Germany (2), France (2), Japan, Korea | |
| US10526635 | | | 12/23/2031 | | |||||||||
| Cap Handling Tool and Method of Use | | | Pathogen Detection | | | US9079757 | | | 8/2/2032 | | | U.S., China, Germany, Japan | |
| Method of Detecting a Salmonella Microorganism | | | Pathogen Detection | | | US9677111 | | | 12/23/2031 | | | U.S., Brazil, China, Germany, France, Great Britain, Japan | |
| US10519481 | | | 12/23/2031 | | |||||||||
| Apparatus for Detecting ATP in a Liquid Sample | | | Hygiene Monitoring | | | US10793890 | | | 5/8/2037 | | | U.S., U.S.*, Europe, Japan | |
| US2019/0169668 | | | 7/1/2033 | | |||||||||
| Method and Culture Device For Detecting Yeasts and Molds | | | Indicators | | | US8921067 | | | 2/25/2033 | | | U.S., Brazil, China, Germany, France, Great Britain, Japan (2) | |
| US9879214 | | | 2/25/2033 | | |||||||||
| US10640743 | | | 2/25/2033 | | |||||||||
| Article and Method For Detecting Aerobic Bacteria | | | Indicators | | | US2021/0087516 | | | 3/5/2035 | | | U.S.*, Brazil, China*, China, Europe*, Germany, France, Great Britain, Japan*, Korea* | |
| Pipette Device | | | Sample Handling | | | US10661266 | | | 11/25/2035 | | | U.S., Brazil, China, Germany, France, Japan | |
| Composition for Reducing Inhibition of Nucleic Acid Amplification | | | Pathogen Detection | | | US10604787 | | | 5/25/2036 | | | U.S., China, Germany (2), France (2), Japan, Korea* | |
| Composition for Reducing Inhibition of Nucleic Acid Amplification | | | Pathogen Detection | | | US10619189 | | | 1/12/2037 | | | U.S., China, Germany, France, Great Britain, Japan, Korea* | |
| Handheld Luminometer | | | Hygiene Monitoring | | | D758224 | | | 6/7/2030 | | | U.S.#, European Union#, Great Britain#, Japan# | |
| Light Detection System and Method of Using Same | | | Hygiene Monitoring | | | US10488249 | | | 2/26/2036 | | | U.S., China*, Germany, Spain, France, Great Britain, Japan, Japan*, Korea* | |
| US11022483 | | | 2/26/2036 | | |||||||||
| Light Detection System and Method of Using Same | | | Hygiene Monitoring | | | US10613038 | | | 1/11/2037 | | | U.S., Brazil, China, Europe*, Japan, Korea* | |
| US11022564 | | | 3/3/2036 | |
| Patent Family Title | | | Product Category | | | Patent / Patent Application Number | | | Anticipated Expiration Date | | | Jurisdictions1 | |
| Light Detection System and Method of Using Same | | | Hygiene Monitoring | | | US10422753 | | | 7/23/2036 | | | U.S., Brazil, China, Germany, France, Japan, Korea* | |
| Handheld Luminometer | | | Hygiene Monitoring | | | D759520 | | | 6/7/2030 | | | U.S.#, European Union#, Great Britain#, Japan# | |
| Culture Device for Lactic Acid Bacteria | | | Indicators | | | US10995356 | | | 6/26/2036 | | | U.S., Brazil, China, Germany, France, Great Britain, Japan, Korea | |
| Thin Film Culture Device with Carbon Dioxide Generant | | | Indicators | | | US10723992 | | | 9/2/2036 | | | U.S., Brazil, China* (2), Germany, France, Great Britain, Japan, Korea | |
| Rapid Detection of E. Coli in A Thin Film Culture Device | | | Indicators | | | US2020/0048679 | | | 4/2/2038 | | | U.S.* (2), China* (2), Germany, Europe, Spain, France, Great Britain, Japan* (2) | |
| US2020/0109431 | | | 4/2/2038 | | |||||||||
| Deactivation Solution Useable for Microorganism Detection | | | Sample Handling | | | WO2021/140431 | | | 1/4/2041 | | | PCT pending; country determination upcoming | |
| Loop-Mediated Isothermal Amplification Primers for Vibrio Parahaemolyticus Detection and Uses Thereof | | | Pathogen Detection | | | WO2021/165828 | | | 2/16/2041 | | | PCT pending; country determination upcoming | |
| Microorganic Detection System with Worklists | | | Indicators | | | WO2021/191793 | | | 3/23/2041 | | | PCT pending; country determination upcoming | |
| Imaging Device with Illumination Components | | | Indicators | | | WO2021/229347 | | | 4/28/2041 | | | PCT pending; country determination upcoming | |
| Removable Cassette for an Imaging Device | | | Indicators | | | WO2021/229343 | | | 4/28/2041 | | | PCT pending; country determination upcoming | |
| Compensation of Intensity Variances in Images Used for Colony Enumeration | | | Indicators | | | WO2021/229337 | | | 4/27/2041 | | | PCT pending; country determination upcoming | |
| Patent Family Title | | | Product Category | | | Patent / Patent Application Number | | | Anticipated Expiration Date | | | Jurisdictions1 | |
| Microorganic Detection System Using a Deep Learning Model | | | Indicators | | | WO2021/234513 | | | 5/12/2041 | | | PCT pending; country determination upcoming | |
| Detecting A Condition For A Culture Device Using A Machine Learning Model | | | Indicators | | | WO2021/234514 | | | 5/12/2041 | | | PCT pending; country determination upcoming | |
| Hygiene Testing Assembly | | | Hygiene Monitoring | | | GB 9000022140-0001 GB 9000022140-0002 GB 9000022140-0003 GB 9000022140-0004 GB 9000022140-0005 GB 9000022140-0006 GB 9000022140-0007 GB 9000022140-0008 GB 9000022140-0009 GB 9000022140-0010 GB 9000022140-0011 GB 9000022140-0012 GB 9000022140-0013 GB 9000022140-0014 GB 9000022140-0015 GB 9000022140-0016 GB 9000022140-0017 GB 9000022140-0018 GB 9000022140-0019 | | | 4/17/2028 | | | Great Britain, European Union# (19) | |
| Pipette | | | Sample Handling | | | KR 30-0786787 | | | 2/27/2030 | | | Korea# | |
| Stand-Up Gusseted Filter Bag | | | Sample Handling | | | DE 202016008880.8 | | | 4/6/2026 | | | Germany† | |
| Culture Device for Anaerobic Microorganisms | | | Indicators | | | JP 6920212 | | | 4/26/2036 | | | Japan, China*, Europe*, Korea* | |
| Display Screen With A Graphical User Interface for Detection and Counting of Microorganism Colonies | | | Indicators | | | CN 202030576630.X | | | 9/25/2030 | | | China#, Brazil#, European Union# (9), Great Britain# (9), Korea# | |
| Culture Plate Reader | | | Indicators | | | CN 202030726478.9 | | | 11/27/2030 | | | China#, Brazil#, European Union# (2), Great Britain# (2), Japan# (2), Korea# | |
| Swab Handle | | | Sample Handling | | | GB 6129432 | | | 4/8/2046 | | | Great Britain#, Brazil#, China#, European Union#, Japan#, Thailand# | |
| | Historical | | | Transaction Accounting Adjustments | | | ||||||||||||||
| | Neogen | | | Food Safety Business after Reclassification Adjustments (Note 3) | | | Pre-Merger Adjustments | | | Notes | | | Merger Adjustments | | | Notes | | | Neogen Pro Forma Combined | |
Assets | | | | | | | | | | | | | | | |||||||
Current assets: | | | | | | | | | | | | | | | |||||||
Cash and cash equivalents | | | $42,879 | | | $— | | | $979,250 | | | 4a | | | $(1,008,573) | | | 5, 6a | | | $13,556 |
Marketable securities | | | 335,560 | | | — | | | — | | | | | — | | | | | 335,560 | ||
Accounts receivable | | | 92,978 | | | 47,781 | | | (47,781) | | | 4b | | | — | | | | | 92,978 | |
Inventories | | | 113,395 | | | 35,122 | | | (24,321) | | | 4b | | | 2,790 | | | 5, 6b | | | 126,986 |
Prepaid expenses and other current assets | | | 24,821 | | | 5,227 | | | (5,227) | | | 4b | | | — | | | | | 24,821 | |
Total current assets | | | 609,633 | | | 88,130 | | | 901,921 | | | | | (1,005,783) | | | | | 593,901 | ||
| | | | | | | | | | | | | | ||||||||
Property, plant and equipment | | | 104,699 | | | 23,562 | | | (2,978) | | | 4b | | | — | | | | | 125,283 | |
Right-of-use assets | | | 2,762 | | | 1,403 | | | — | | | | | — | | | | | 4,165 | ||
Goodwill | | | 150,029 | | | 81,046 | | | (81,046) | | | 4b | | | 1,928,982 | | | 5 | | | 2,079,011 |
Other intangible assets, net | | | 112,064 | | | 3,250 | | | (3,250) | | | 4b | | | 2,600,000 | | | 5, 6c | | | 2,712,064 |
Deferred tax assets | | | — | | | 3,836 | | | (3,836) | | | 4b | | | — | | | | | — | |
Other non-current assets | | | 2,018 | | | 1,289 | | | — | | | | | — | | | | | 3,307 | ||
Total assets | | | $981,205 | | | $202,516 | | | $810,811 | | | | | $3,523,199 | | | | | $5,517,731 | ||
Liabilities and Shareholders' Equity | | | | | | | | | | | | | | | |||||||
Current liabilities: | | | | | | | | | | | | | | | |||||||
Accounts payable | | | $23,548 | | | $8,497 | | | $(8,497) | | | 4b | | | $(15,189) | | | 5, 6a | | | $8,359 |
Accrued compensation | | | 9,655 | | | 3,641 | | | (3,641) | | | 4b | | | — | | | | | 9,655 | |
Operating lease liabilities - current | | | — | | | — | | | — | | | | | — | | | | | — | ||
Other accruals | | | 32,507 | | | 4,336 | | | (5,554) | | | 4a, b | | | (10,362) | | | 6e | | | 20,927 |
Total current liabilities | | | 65,710 | | | 16,474 | | | (17,692) | | | | | (25,551) | | | | | 38,941 | ||
| | | | | | | | | | | | | | ||||||||
Deferred income taxes | | | 21,196 | | | 8 | | | (8) | | | 4b | | | 546,000 | | | 5, 6d | | | 567,196 |
Other non-current liabilities | | | 18,755 | | | 1,017 | | | — | | | | | — | | | | | 19,772 | ||
Operating lease liabilities – non-current | | | — | | | — | | | — | | | | | — | | | | | — | ||
Long-term debt | | | — | | | — | | | 986,750 | | | 4a | | | — | | | | | 986,750 | |
Total liabilities | | | 105,661 | | | 17,499 | | | 969,050 | | | | | 520,449 | | | | | 1,612,659 | ||
| | | | | | | | | | | | | | ||||||||
Shareholders' equity: | | | | | | | | | | | | | | | |||||||
Common stock | | | 17,251 | | | — | | | — | | | | | 17,317 | | | 5, 6e | | | 34,568 | |
Parent company net investment | | | — | | | 228,921 | | | (152,314) | | | 4b | | | (76,607) | | | 5, 6e | | | — |
Additional paid-in capital | | | 307,780 | | | — | | | — | | | | | 3,057,115 | | | 5, 6e | | | 3,364,895 | |
Accumulated other comprehensive income (loss) | | | (22,439) | | | (43,904) | | | — | | | | | 43,904 | | | 5, 6e | | | (22,439) | |
Retained earnings | | | 572,952 | | | — | | | (5,925) | | | 4a | | | (38,979) | | | 6e | | | 528,048 |
Total shareholders' equity | | | 875,544 | | | 185,017 | | | (158,239) | | | | | 3,002,750 | | | | | 3,905,072 | ||
Total liabilities and shareholders' equity | | | $981,205 | | | $202,516 | | | $810,811 | | | | | $3,523,199 | | | | | $5,517,731 |
| | Historical | | | Transaction Accounting Adjustments | | | ||||||||||||||
| | Neogen | | | Food Safety Business after Reclassification Adjustments (Note 3) | | | Pre-Merger Adjustments | | | Notes | | | Merger Adjustments | | | Notes | | | Neogen Pro Forma Combined | |
Assets | | | | | | | | | | | | | | | |||||||
Current assets: | | | | | | | | | | | | | | | |||||||
Cash and cash equivalents | | | $44,473 | | | $— | | | $979,188 | | | 4a | | | $999,062 | | | 5, 6a | | | $24,599 |
Marketable securities | | | 336,578 | | | — | | | — | | | | | — | | | | | 336,578 | ||
Accounts receivable | | | 99,674 | | | 51,129 | | | (51,129) | | | 4b | | | — | | | | | 99,674 | |
Inventories | | | 122,313 | | | 36,170 | | | (25,345) | | | 4b | | | 2,796 | | | 5, 6b | | | 135,934 |
Prepaid expenses and other current assets | | | 23,760 | | | 5,176 | | | (5,176) | | | 4b | | | — | | | | | 23,760 | |
Total current assets | | | 626,798 | | | 92,475 | | | 897,538 | | | | | (996,266) | | | | | 620,545 | ||
| | | | | | | | | | | | | | ||||||||
Property, plant and equipment | | | 110,584 | | | 22,879 | | | (2,638) | | | 4b | | | — | | | | | 130,825 | |
Right-of-use assets | | | 3,184 | | | 1,268 | | | — | | | | | — | | | | | 4,452 | ||
Goodwill | | | 142,704 | | | 81,134 | | | (81,134) | | | 4b | | | 1,238,382 | | | 5 | | | 1,381,086 |
Other intangible assets, net | | | 107,503 | | | 3,092 | | | (3,092) | | | 4b | | | 2,600,000 | | | 5, 6c | | | 2,707,503 |
Deferred tax assets | | | — | | | 3,836 | | | (3,836) | | | 4b | | | — | | | | | — | |
Other non-current assets | | | 2,156 | | | 1,433 | | | — | | | | | — | | | | | 3,589 | ||
Total assets | | | $992,929 | | | $206,117 | | | $806,838 | | | | | $2,842,116 | | | | | $4,848,000 | ||
Liabilities and Shareholders' Equity | | | | | | | | | | | | | | | |||||||
Current liabilities: | | | | | | | | | | | | | | | |||||||
Accounts payable | | | $34,614 | | | $10,084 | | | $(10,084) | | | 4b | | | $(11,377) | | | 5, 6a | | | $23,237 |
Accrued compensation | | | 11,123 | | | 1,305 | | | (1,305) | | | 4b | | | — | | | | | 11,123 | |
Income tax payable | | | 2,126 | | | — | | | — | | | | | — | | | | | 2,126 | ||
Operating lease liabilities - current | | | — | | | — | | | — | | | | | — | | | — | | |||
Other accruals | | | 29,981 | | | 3,896 | | | (5,125) | | | 4a, b | | | (9,157) | | | 6e | | | 19,595 |
Total current liabilities | | | 77,844 | | | 15,285 | | | (16,514) | | | | | (20,534) | | | | | 56,081 | ||
| | | | | | | | | | | | | | ||||||||
Deferred income taxes | | | 17,011 | | | 8 | | | (8) | | | 4b | | | 546,000 | | | 5, 6d | | | 563,011 |
Other non-current liabilities | | | 10,700 | | | 901 | | | — | | | | | — | | | | | 11,601 | ||
Operating lease liabilities – non-current | | | — | | | — | | | — | | | | | — | | | | | — | ||
Long-term debt | | | — | | | — | | | 986,688 | | | 4a | | | — | | | | | 986,688 | |
Total liabilities | | | 105,555 | | | 16,194 | | | 970,166 | | | | | 525,466 | | | | | 1,617,381 | ||
| | | | | | | | | | | | | | ||||||||
Shareholders' equity: | | | | | | | | | | | | | | | |||||||
Common stock | | | 17,248 | | | — | | | — | | | | | 17,323 | | | 5, 6e | | | 34,571 | |
Parent company net investment | | | — | | | 233,561 | | | (157,403) | | | 4b | | | (76,158) | | | 5, 6e | | | — |
Additional paid-in capital | | | 309,984 | | | — | | | — | | | | | 2,366,297 | | | 5, 6e | | | 2,676,281 | |
Accumulated other comprehensive income (loss) | | | (27,769) | | | (43,638) | | | — | | | | | 43,638 | | | 5, 6e | | | (27,769) | |
Retained earnings | | | 587,911 | | | — | | | (5,925) | | | 4a | | | (34,450) | | | 6e | | | 547,536 |
Total shareholders' equity | | | 887,374 | | | 189,923 | | | (163,328) | | | | | 2,316,650 | | | | | 3,230,619 | ||
| | | | | | | | | | | | | | ||||||||
Total liabilities and shareholders' equity | | | $992,929 | | | $206,117 | | | $806,838 | | | | | $2,842,116 | | | | | $4,848,000 |
| | Historical | | | Transaction Accounting Adjustments | | | ||||||||||||||
| | Neogen | | | Food Safety Business after Reclassification Adjustments (Note 3) | | | Pre-Merger Adjustments | | | Notes | | | Merger Adjustments | | | Notes | | | Neogen Pro Forma Combined | |
Revenues | | | $387,066 | | | $282,871 | | | $— | | | | | $— | | | | | $669,937 | ||
Cost of revenues | | | 209,052 | | | 111,232 | | | (1,609) | | | 4c | | | — | | | | | 318,675 | |
Gross margin | | | 178,014 | | | 171,639 | | | 1,609 | | | | | — | | | | | 351,262 | ||
| | | | | | | | | | | | | | ||||||||
Operating Expenses | | | | | | | | | | | | | | | |||||||
Sales and marketing | | | 63,220 | | | 41,100 | | | — | | | | | — | | | | | 104,320 | ||
General and administrative | | | 60,985 | | | 21,339 | | | (560) | | | 4b | | | 130,214 | | | 6g | | | 211,978 |
Research and development | | | 13,218 | | | 19,149 | | | — | | | | | — | | | | | 32,367 | ||
Total operating expenses (income) | | | 137,423 | | | 81,588 | | | (560) | | | | | 130,214 | | | | | 348,665 | ||
Operating income (expense) | | | 40,591 | | | 90,051 | | | 2,169 | | | | | (130,214) | | | | | 2,597 | ||
| | | | | | | | | | | | | | ||||||||
Other income (expense) | | | | | | | | | | | | | | | |||||||
Interest income | | | 741 | | | — | | | — | | | | | — | | | | | 741 | ||
Finance expense | | | — | | | — | | | — | | | | | (33,259) | | | 6h | | | (33,259) | |
Other income (expense) | | | (34) | | | — | | | — | | | | | — | | | | | (34) | ||
Total other income (expense) | | | 707 | | | — | | | — | | | | | (33,259) | | | | | (32,552) | ||
Income (loss) before taxes | | | 41,298 | | | 90,051 | | | 2,169 | | | | | (163,473) | | | | | (29,955) | ||
Provision for income taxes | | | 7,950 | | | 18,163 | | | 419 | | | 6i | | | (31,550) | | | 6i | | | (5,018) |
Net income (loss) | | | $33,348 | | | $71,888 | | | $ 1,750 | | | | | $ (131,923) | | | | | $(24,937) | ||
Net income (loss) per share available to common stockholders: | | | | | | | | | | | | | | | |||||||
Basic | | | $ 0.31 | | | | | | | | | | | | | $(0.12) | |||||
Diluted | | | $ 0.31 | | | | | | | | | | | | | $(0.12) | |||||
Weighted average shares outstanding: | | | | | | | | | | | | | | | |||||||
Basic | | | 107,648 | | | | | | | | | | | | | 215,881 | |||||
Diluted | | | 108,130 | | | | | | | | | | | | | 215,881 |
| | Historical | | | Transaction Accounting Adjustments | | | ||||||||||||||
| | Neogen | | | Food Safety Business after Reclassification Adjustments (Note 3) | | | Pre-Merger Adjustments | | | Notes | | | Merger Adjustments | | | Notes | | | Neogen Pro Forma Combined | |
Revenues | | | $527,159 | | | $374,492 | | | $— | | | | | $— | | | | | $901,651 | ||
Cost of revenues | | | 284,146 | | | 147,461 | | | (2,229) | | | 4c | | | 10,371 | | | 6f | | | 439,749 |
Gross margin | | | 243,013 | | | 227,031 | | | 2,229 | | | | | (10,371) | | | | | 461,902 | ||
| | | | | | | | | | | | | | ||||||||
Operating expenses | | | | | | | | | | | | | | | |||||||
Sales and marketing | | | 84,604 | | | 55,228 | | | — | | | | | — | | | | | 139,832 | ||
General and administrative | | | 82,742 | | | 29,322 | | | (747) | | | 4b | | | 217,227 | | | 6g | | | 328,544 |
Research and development | | | 17,049 | | | 25,484 | | | — | | | | | — | | | | | 42,533 | ||
Total operating expenses (income) | | | 184,395 | | | 110,034 | | | (747) | | | | | 217,227 | | | | | 510,909 | ||
Operating income (loss) | | | 58,618 | | | 116,997 | | | 2,976 | | | | | (227,598) | | | | | (49,007) | ||
| | | | | | | | | | | | | | ||||||||
Other income (expense) | | | | | | | | | | | | | | | |||||||
Interest income | | | 1,267 | | | — | | | — | | | | | — | | | | | 1,267 | ||
Finance expense | | | — | | | — | | | — | | | | | (66,965) | | | 6h | | | (66,965) | |
Other income (expense) | | | 322 | | | — | | | — | | | | | — | | | | | 322 | ||
Total other income (expense) | | | 1,589 | | | — | | | — | | | | | (66,965) | | | | | (65,376) | ||
| | | | | | | | | | | | | | ||||||||
Income (loss) before taxes | | | 60,207 | | | 116,997 | | | 2,976 | | | | | (294,563) | | | | | (114,383) | ||
Provision for income taxes | | | 11,900 | | | 23,812 | | | 589 | | | 6i | | | (58,324) | | | 6i | | | (22,023) |
Net income (loss) | | | $48,307 | | | $93,185 | | | $2,387 | | | | | $(236,239) | | | | | $(92,360) | ||
| | | | | | | | | | | | | | ||||||||
Net income (loss) per share available to common stockholders: | | | | | | | | | | | | | | | |||||||
Basic | | | $0.45 | | | | | | | | | | | | | $(0.43) | |||||
Diluted | | | $0.45 | | | | | | | | | | | | | $(0.43) | |||||
Weighted average shares outstanding: | | | | | | | | | | | | | | | |||||||
Basic | | | 107,684 | | | | | | | | | | | | | 215,954 | |||||
Diluted | | | 108,020 | | | | | | | | | | | | | 215,954 |
| | Historical | | | Transaction Accounting Adjustments | | | ||||||||||||||
| | Neogen | | | Food Safety Business after Reclassification Adjustments (Note 3) | | | Pre-Merger Adjustments | | | Notes | | | Merger Adjustments | | | Notes | | | Neogen Pro Forma Combined | |
Revenues | | | $468,459 | | | $350,648 | | | $— | | | | | $— | | | | | $819,107 | ||
Cost of revenues | | | 253,403 | | | 133,646 | | | (1,869) | | | 4c | | | 2,790 | | | 6f | | | 387,970 |
Gross margin | | | 215,056 | | | 217,002 | | | 1,869 | | | | | (2,790) | | | | | 431,137 | ||
| | | | | | | | | | | | | | ||||||||
Operating expenses | | | | | | | | | | | | | | | |||||||
Sales and marketing | | | 73,443 | | | 47,234 | | | — | | | | | — | | | | | 120,677 | ||
General and administrative | | | 51,197 | | | 27,824 | | | (747) | | | 4b | | | 222,949 | | | 6g | | | 301,223 |
Research and development | | | 16,247 | | | 22,631 | | | — | | | | | — | | | | | 38,878 | ||
Total operating expenses (income) | | | 140,887 | | | 97,689 | | | (747) | | | | | 218,877 | | | | | 460,778 | ||
Operating income (expense) | | | 74,169 | | | 119,313 | | | 2,616 | | | | | (225,739) | | | | | (29,641) | ||
| | | | | | | | | | | | | | ||||||||
Other income (expense) | | | | | | | | | | | | | | | |||||||
Interest income | | | 1,614 | | | — | | | — | | | | | — | | | | | 1,614 | ||
Finance expense | | | (515) | | | — | | | — | | | | | (51,845) | | | 6h | | | (52,360) | |
Total other income (expense) | | | 1,099 | | | — | | | — | | | | | (51,845) | | | | | (50,746) | ||
| | | | | | | | | | | | | | ||||||||
Income (loss) before taxes | | | 75,268 | | | 119,313 | | | 2,616 | | | | | (277,584) | | | | | (80,387) | ||
Provision for income taxes | | | 14,386 | | | 25,217 | | | 500 | | | 6i | | | (53,019) | | | 6i | | | (12,916) |
Net income (loss) | | | $60,882 | | | $94,096 | | | $2,116 | | | | | $(224,565) | | | | | $(67,471) | ||
| | | | | | | | | | | | | | ||||||||
Net income (loss) per share available to common stockholders: | | | | | | | | | | | | | | | |||||||
Basic | | | $0.57 | | | | | | | | | | | | | $(0.31) | |||||
Diluted | | | $0.57 | | | | | | | | | | | | | $(0.31) | |||||
Weighted average shares outstanding: | | | | | | | | | | | | | | | |||||||
Basic | | | 106,499 | | | | | | | | | | | | | 214,732 | |||||
Diluted | | | 107,120 | | | | | | | | | | | | | 214,732 |
| | Historical Food Safety Business | | Reclassification Adjustments | | Notes | | Historical Food Safety Business after Reclassification Adjustments | | | Historical Food Safety Business | | Reclassification Adjustments | | Notes | | Historical Food Safety Business after Reclassification Adjustments | |||||||
Assets | | | | | | | | | ||||||||||||||||
Current assets: | | | | | | | | | ||||||||||||||||
Accounts receivable | | $47,781 | | $— | | | $47,781 | | $51,129 | | $— | | | $51,129 | ||||||||||
Inventories | | 35,122 | | — | | | 35,122 | | 36,170 | | — | | | 36,170 | ||||||||||
Prepaid expenses and other current assets | | 5,227 | | — | | | 5,227 | | 5,176 | | — | | | 5,176 | ||||||||||
Total current assets | | 88,130 | | — | | | 88,130 | | 92,475 | | — | | | 92,475 | ||||||||||
| | | | | | | | |||||||||||||||||
Property, plant and equipment | | 23,562 | | — | | | 23,562 | | 22,879 | | — | | | 22,879 | ||||||||||
Right-of-use assets | | 1,403 | | — | | | 1,403 | | 1,268 | | — | | | 1,268 | ||||||||||
Goodwill | | 81,046 | | — | | | 81,046 | | 81,134 | | — | | | 81,134 | ||||||||||
Other intangible assets, net | | 3,250 | | — | | | 3,250 | | 3,092 | | — | | | 3,092 | ||||||||||
Deferred tax assets | | 3,836 | | — | | | 3,836 | | 3,836 | | — | | | 3,836 | ||||||||||
Other non-current assets | | 1,289 | | — | | | 1,289 | | 1,433 | | — | | | 1,433 | ||||||||||
Total assets | | $202,516 | | — | | | $202,516 | | $206,117 | | — | | | $206,117 | ||||||||||
| | | | | | | | |||||||||||||||||
Liabilities and Shareholders' Equity | | | | | | | | | ||||||||||||||||
Current liabilities: | | | | | | | | | ||||||||||||||||
Accounts payable | | $8,497 | | — | | | $8,497 | | $10,084 | | — | | | $10,084 | ||||||||||
Accrued compensation | | 3,641 | | — | | | 3,641 | | 1,305 | | — | | | 1,305 | ||||||||||
Operating lease liabilities - current | | 357 | | (357) | | a | | — | | 346 | | (346) | | a | | — | ||||||||
Other accruals | | 3,979 | | 357 | | a | | 4,336 | | 3,550 | | 346 | | a | | 3,896 | ||||||||
Total current liabilities | | 16,474 | | — | | | 16,474 | | 15,285 | | — | | | 15,285 | ||||||||||
| | | | | | | | |||||||||||||||||
Deferred income taxes | | 8 | | — | | | 8 | | 8 | | — | | | 8 | ||||||||||
Other non-current liabilities | | — | | 1,017 | | b | | 1,017 | | — | | 901 | | b | | 901 | ||||||||
Operating lease liabilities – non-current | | 1,017 | | (1,017) | | b | | — | | 901 | | (901) | | b | | — | ||||||||
Long-term debt | | — | | | | | — | | — | | | — | ||||||||||||
Total liabilities | | 17,499 | | — | | | 17,499 | | 16,194 | | — | | | 16,194 | ||||||||||
| | | | | | | | |||||||||||||||||
Shareholders' equity: | | | | | | | | | ||||||||||||||||
Common stock | | — | | — | | | — | | — | | — | | | — | ||||||||||
Parent company net investment | | 228,921 | | — | | | 228,921 | | 233,561 | | — | | | 233,561 | ||||||||||
Additional paid-in capital | | — | | — | | | — | | — | | — | | | — | ||||||||||
Accumulated other comprehensive income (loss) | | (43,904) | | — | | | (43,904) | | (43,638) | | — | | | (43,638) | ||||||||||
Retained earnings | | — | | — | | | — | | — | | — | | | — | ||||||||||
Total shareholders' equity | | 185,017 | | — | | | 185,017 | | 189,923 | | — | | | 189,923 | ||||||||||
Total liabilities and shareholders' equity | | $202,516 | | — | | | $202,516 | | $206,117 | | — | | | $206,117 |
| | Historical Food Safety Business | | | Reclassification Adjustments | | | Notes | | | Historical Food Safety Business after Reclassification Adjustments | |
Revenues | | | $— | | | $282,871 | | | d | | | $282,871 |
Net sales | | | 282,871 | | | (282,871) | | | d | | | — |
Cost of revenues | | | — | | | 111,232 | | | d | | | 111,232 |
Gross margin | | | 282,871 | | | (111,232) | | | | | 171,639 | |
| | | | | | | | |||||
Operating Expenses | | | | | | | | | ||||
Cost of sales | | | 111,232 | | | (111,232) | | | d | | | — |
Sales and marketing | | | — | | | 41,100 | | | c | | | 41,100 |
General and administrative | | | — | | | 21,339 | | | c | | | 21,339 |
Selling, general and administrative | | | 62,439 | | | (62,439) | | | c | | | — |
Research and development | | | — | | | 19,149 | | | d | | | 19,149 |
Research, development and related expenses | | | 19,149 | | | (19,149) | | | d | | | — |
Total operating expenses (income) | | | 192,820 | | | (111,232) | | | | | 81,588 | |
| | | | | | | | |||||
Income (loss) before taxes | | | 90,051 | | | — | | | | | 90,051 | |
Provision for income taxes | | | 18,163 | | | — | | | | | 18,163 | |
Net income (loss) | | | $71,888 | | | — | | | | | $71,888 |
| | Historical Food Safety Business | | | Reclassification Adjustments | | | Notes | | | Historical Food Safety Business after Reclassification Adjustments | |
Revenues | | | $— | | | $350,648 | | | d | | | $350,648 |
Net sales | | | 350,648 | | | (350,648) | | | d | | | — |
Cost of revenues | | | — | | | 133,646 | | | d | | | 133,646 |
Gross margin | | | 350,648 | | | (133,646) | | | | | 217,002 | |
| | | | | | | | |||||
Operating Expenses | | | | | | | | | ||||
Cost of sales | | | 133,646 | | | (133,646) | | | d | | | — |
Sales and marketing | | | — | | | 47,234 | | | c | | | 47,234 |
General and administrative | | | — | | | 27,824 | | | c | | | 27,824 |
Selling, general and administrative | | | 75,058 | | | (75,058) | | | c | | | — |
Research and development | | | — | | | 22,631 | | | d | | | 22,631 |
Research, development and related expenses | | | 22,631 | | | (22,631) | | | d | | | — |
Total operating expenses (income) | | | 231,335 | | | (133,646) | | | | | 97,689 | |
| | | | | | | | |||||
Income (loss) before taxes | | | 119,313 | | | — | | | | | 119,313 | |
Provision for income taxes | | | 25,217 | | | — | | | | | 25,217 | |
Net income (loss) | | | $94,096 | | | — | | | | | $94,096 |
| | Historical Food Safety Business | | | Reclassification Adjustments | | | Notes | | | Historical Food Safety Business after Reclassification Adjustments | |
Revenues | | | $— | | | $374,492 | | | d | | | $374,492 |
Net sales | | | 374,492 | | | (374,492) | | | d | | | — |
Cost of revenues | | | — | | | 147,461 | | | d | | | 147,461 |
Gross margin | | | 374,492 | | | (147,461) | | | | | 227,031 | |
| | | | | | | | |||||
Operating Expenses | | | | | | | | | ||||
Cost of sales | | | 147,461 | | | (147,461) | | | d | | | — |
Sales and marketing | | | — | | | 55,228 | | | c | | | 55,228 |
General and administrative | | | — | | | 29,322 | | | c | | | 29,322 |
Selling, general and administrative | | | 84,550 | | | (84,550) | | | c | | | — |
Research and development | | | — | | | 25,484 | | | d | | | 25,484 |
Research, development and related expenses | | | 25,484 | | | (25,484) | | | d | | | — |
Total operating expenses (income) | | | 257,495 | | | (147,461) | | | | | 110,034 | |
| | | | | | | | |||||
Income (loss) before taxes | | | 116,997 | | | — | | | | | 116,997 | |
Provision for income taxes | | | 23,812 | | | — | | | | | 23,812 | |
Net income (loss) | | | $93,185 | | | — | | | | | $93,185 |
a) | Reflects a presentation conforming adjustment to reclassify operating lease liabilities – current, which is presented separately on the face of the Food Safety Business historical balance sheet to other accruals, as presented on the face of the Neogen historical balance sheet. |
b) | Reflects a presentation conforming adjustment to reclassify operating lease liabilities – non-current, which is presented separately on the face of the Food Safety Business historical balance sheet to other non-current liabilities, as presented on the face of the Neogen historical balance sheet. |
c) | Reflects a presentation conforming adjustment to reclassify sales and marketing expenses recorded in selling, general and administrative expenses in the Food Safety Business historical income statements that are presented separately on the face of the Neogen historical income statements. |
d) | Reflects presentation conforming adjustments to reclassify certain line items of the historical Food Safety Business combined statement of income in conformity with the presentation of Neogen’s historical income statements such as net sales to revenues, cost of sales to cost of revenue and research, development and related expenses to research and development. |
a) | Debt |
| | As of | |
| | ||
Term Loan Facility | | | |
Debt issuance costs | | | |
Pro forma adjustments to long-term debt | | |
b) | Reflects a net decrease of |
c) | Reflects an adjustment of |
Purchase Price Allocation | | | |
Estimated number of shares of Neogen common stock issued and outstanding | | | |
Share issuance ratio(i) | | | 1.00400802 |
Estimated number of shares to be issued to 3M stockholders | | | |
Neogen common stock price(ii) | | | $ |
Estimated fair value of equity shares to be issued | | | $ |
Aggregate consideration to 3M(iii) | | | 1,000,000 |
Estimated net working capital adjustment | | | |
Estimated fair value of long-term incentive (“LTI”) replacement awards | | | |
Estimated total Merger Consideration(iv) | | | $ |
Recognized amounts of identifiable assets acquired and liabilities assumed | | | |
Net book value of the Food Safety Business historical balance sheet | | | $ |
Less: Pre-Merger adjustments of net assets acquired as of | | | ( |
Net book value of net assets acquired as of | | | |
Adjustments to fair value: | | | |
Increase in inventories | | | |
Identifiable intangible assets | | | 2,600,000 |
Deferred tax liabilities | | | (546,000) |
Total goodwill | | | $ |
i. | The number of shares of Neogen common stock to be issued is equal to the greater of (x) 108,185,928 or (y) the product of (i) the number of shares of Neogen Common Stock issued and outstanding immediately prior to the effective time of the Merger multiplied by (ii) 1.00400802. |
ii. | Represents Neogen’s stock price as of |
iii. | Represents the sum total of (a) an amount of cash (not to be less than $465 million) determined in accordance with the Separation Agreement, (b) $181.6 million in cash payable by Neogen to 3M pursuant to the Asset Purchase Agreement plus the amount of cash paid in consideration of any other separately conveyed assets and (c) an aggregate principal amount of Garden SpinCo debt securities equal to $1,000 million (plus or minus any applicable working capital adjustment determined in accordance with the Separation Agreement) minus the amounts paid pursuant to the foregoing clauses (a) and (b). |
iv. | The Merger Consideration will be determined, in part, based on the total number of shares of Neogen common stock that will be issued to former Garden SpinCo stockholders in the Merger. Because the Exchange Ratio in the Merger Agreement is fixed to result in the number of shares of Neogen common stock that will ultimately be issued in the Merger being equal to the number that will result in former Garden SpinCo stockholders holding, in the aggregate, 50.1% of the total number of shares of Neogen common stock issued and outstanding immediately following the Merger, the Merger Consideration is not expected to be impacted by whether or not 3M elects to distribute the Garden SpinCo common stock to 3M stockholders in a pro rata spin-off or an Exchange Offer (including any Clean-Up Spin-Off). |
a) | Cash and cash equivalents |
Sources of Funds | | | | | Uses of Funds | | | | | | | Uses of Funds | | | ||||
Term Loan Facility | | $600,000 | | Merger consideration(ii) | | $(55,957) | | $ 650,000 | | Merger consideration(i) | | $ (55,922) | ||||||
Senior unsecured notes | | 400,000 | | Cash consideration to 3M(iii) | | 1,000,000 | | 350,000 | | Cash consideration to 3M(ii) | | 1,000,000 | ||||||
Cash contribution(i) | | 8,573 | | | ||||||||||||||
| | | | | ||||||||||||||
| | Estimated transaction fees and expenses(iv) | | 64,530 | | | Estimated transaction fees and expenses(iii) | | 54,984 | |||||||||
Total sources | | $1,008,573 | | Total uses | | $1,008,573 | | $1,000,000 | | Total uses | | $999,062 |
i. |
Represents the estimated cash consideration received from 3M as a result of the net working capital payment adjustment as included in the Separation Agreement. |
Represents aggregate consideration to 3M valued at $1,000.0 million, based on the sum total of (a) an amount of cash (not to be less than $465 million) determined in accordance with the Separation Agreement, (b) $181.6 million in cash payable by Neogen to 3M pursuant to the Asset Purchase Agreement plus the amount of cash paid in consideration of any other separately conveyed assets and (c) an aggregate principal amount of Garden SpinCo debt securities equal to $1,000.0 million minus the amounts paid pursuant to the foregoing clauses (a) and (b) |
Represents the estimated fees and expenses associated with the Transactions in the aggregate amount of approximately |
b) | Inventories |
c) | Intangible assets |
d) | Deferred tax liabilities |
e) | Total equity |
i. | an increase in equity to reflect the non-cash estimated share consideration issued by Neogen in the amount of |
ii. | a decrease in equity to reflect the elimination of the Food Safety Business’ historical equity of |
iii. | an increase in equity to reflect the elimination of the Food Safety Business’ historical accumulated other comprehensive income (loss) of |
iv. | a decrease in retained earnings of |
f) | Cost of revenues |
g) | General and administrative |
i. | Amortization of intangible assets |
| | Estimated fair value | | Estimated useful life (in years) | | Amortization expense for the year ended May 31, 2021 | | Amortization expense for the nine months ended February 28, 2022 | | | Estimated fair value | | Estimated useful life (in years) | | Amortization expense for the year ended May 31, 2022 | ||||||
Finite lived intangible assets | | | | | | | | ||||||||||||||
Trade Names | | 400,000 | | 10-20 years | | 26,666 | | 20,000 | | 400,000 | | 10-20 years | | 26,666 | |||||||
Customer Relationships | | 1,800,000 | | 10-20 years | | 120,000 | | 90,000 | | 1,800,000 | | 10-20 years | | 120,000 | |||||||
Developed Technology | | 400,000 | | 5-25 years | | 26,667 | | 20,000 | | 400,000 | | 5-25 years | | 26,667 | |||||||
Pro forma adjustment | | 2,600,000 | | | 173,333 | | 130,000 | | 2,600,000 | | | 173,333 |
ii. | Transaction fees and expenses |
iii. | Stock based compensation |
iv. | Transition Arrangements |
h) | Finance expense |
i) | Income tax expense |
| | Year ended May 31, 2021 | | | Nine months ended February 28, 2022 | |
Pro forma net (loss) attributable to common stockholders | | | (67,471) | | | (24,937) |
Weighted average number of Neogen shares outstanding – basic | | | 106,499 | | | 107,648 |
Neogen shares to be issued to 3M stockholders as part of purchase consideration | | | 108,233 | | | 108,233 |
Pro forma weighted average number shares outstanding — basic and diluted | | | 214,732 | | | 215,881 |
Pro forma net (loss) per share of common stock — basic and diluted | | | $(0.31) | | | $(0.12) |
| | Year ended May 31, 2022 | |
Pro forma net (loss) attributable to common stockholders | | | (92,360) |
Weighted average number of Neogen shares outstanding – basic | | | 107,684 |
Neogen shares to be issued to 3M stockholders as part of purchase consideration | | | 108,270 |
Pro forma weighted average number shares outstanding — basic and diluted | | | 215,954 |
Pro forma net (loss) per share of common stock — basic and diluted | | | $(0.43) |
(In thousands of U.S. dollars) | | 2021 | | 2020 | | 2019 | | 2021 vs. 2020 | | 2020 vs. 2019 | | March 31, 2022 | | March 31, 2021 | | 2022 vs 2021 | ||||||||
Net sales | | $368,388 | | $336,764 | | $337,088 | | 9.4% | | (0.1)% | | $91,621 | | $85,517 | | 7.1% |
(In thousands of U.S. dollars) | | | March 31, 2022 | | | March 31, 2021 | | | 2022 vs 2021 |
Cost of sales | | | $36,229 | | | $32,116 | | | 12.8% |
Selling, general and administrative expenses (SG&A) | | | 22,111 | | | 19,964 | | | 10.7% |
Research, development and related expenses (R&D) | | | 6,335 | | | 6,036 | | | 5.0% |
Total operating expenses | | | $64,675 | | | $58,116 | | | 11.3% |
(In thousands of U.S. dollars) | | | March 31, 2022 | | | March 31, 2021 | | | 2022 vs 2021 |
Operating Income | | | $26,946 | | | $27,401 | | | (1.7)% |
(Percent of pre-tax income) | | | March 31, 2022 | | | March 31, 2021 |
Effective tax rate | | | 21.0% | | | 20.3% |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 | | | 2021 vs 2020 | | | 2020 vs 2019 |
Net sales | | | $368,388 | | | $336,764 | | | $337,088 | | | 9.4% | | | (0.1)% |
(In thousands of U.S. dollars) | | 2021 | | 2020 | | 2019 | | 2021 vs. 2020 | | 2020 vs. 2019 | | 2021 | | 2020 | | 2019 | | 2021 vs 2020 | | 2020 vs 2019 | ||||||||||
Cost of sales | | 143,348 | | 127,027 | | 121,302 | | 12.8% | | 4.7% | | 143,348 | | 127,027 | | 121,302 | | 12.8% | | 4.7% | ||||||||||
Selling, general and administrative expenses (SG&A) | | 82,403 | | 71,698 | | 78,776 | | 14.9% | | (9.0)% | | 82,403 | | 71,698 | | 78,776 | | 14.9% | | (9.0)% | ||||||||||
Research, development and related expenses (R&D) | | 25,185 | | 20,830 | | 20,727 | | 20.9% | | 0.5% | ||||||||||||||||||||
Research, development, and related expenses (R&D) | | 25,185 | | 20,830 | | 20,727 | | 20.9% | | 0.5% | ||||||||||||||||||||
Total operating expenses | | 250,936 | | 219,555 | | 220,805 | | 14.3% | | (0.6)% | | 250,936 | | 219,555 | | 220,805 | | 14.3% | | (0.6)% |
(In thousands of U.S. dollars) | | 2021 | | 2020 | | 2019 | | 2021 vs. 2020 | | 2020 vs. 2019 | | 2021 | | 2020 | | 2019 | | 2021 vs 2020 | | 2020 vs 2019 | ||||||||||
Operating Income | | 117,452 | | 117,209 | | 116,283 | | 0.2% | | 0.8% | | 117,452 | | 117,209 | | 116,283 | | 0.2% | | 0.8% |
(Percent of pre-tax income) | | | 2021 | | | 2020 | | | 2019 |
Effective tax rate | | | 20.2% | | | 21.5% | | | 21.1% |
| | Three months ended March 31, | | Years ended December 31, | ||||||||||||||||||||
(In thousands of U.S. dollars) | | 2021 | | 2020 | | 2019 | | 2022 | | 2021 | | 2021 | | 2020 | | 2019 | ||||||||
Net cash provided by (used in) operating activities | | $89,780 | | $100,417 | | $100,044 | | 18,974 | | 20,484 | | 89,780 | | 100,417 | | 100,044 | ||||||||
Net cash provided by (used in) investing activities | | (5,088) | | (4,359) | | (4,125) | | (1,522) | | (1,941) | | (5,088) | | (4,359) | | (4,125) | ||||||||
Net cash provided by (used in) financing activities | | (84,692) | | (96,058) | | (95,919) | | (17,452) | | (18,543) | | (84,692) | | (96,058) | | (95,919) |
��� | the fact that Neogen’s executive officers may have certain interests in or receive certain benefits from the Transactions that are different from, or in addition to, those of Neogen’s shareholders (See “The Transactions—Interests of Certain Persons in the Transactions”); and |
Selected Public Companies | | | EV/2022E EBITDA |
Agilent Technologies, Inc. | | | 26.5x |
Bio-Techne Corporation | | | 45.5x |
Mettler-Toledo International, Inc. | | | 33.5x |
PerkinElmer, Inc. | | | 18.8x |
Waters Corporation | | | 22.6x |
| | EV/2022E EBITDA | ||||
| | Mean | | | Median | |
Selected Public Companies | | | 29.4x | | | 26.5x |
Valuation Methodology for “Gets” | | | “Has” (equity value in millions) | | | “Gets” (Combined company, including synergies) (equity value in millions) |
EV/EBITDA (2022E) | | | $4,356 | | | $5,072 |
Discounted Cash Flows | | | $4,356 | | | $5,169 |
| | Contribution Percentages (Neogen / Food Safety Business) | | | Implied Equity Split (Neogen / Food Safety Business) | |||||||
Revenue: | | | | | | | | | ||||
FY 2022E | | | 56% | | | 44% | | | 67% | | | 33% |
FY 2023E | | | 56% | | | 44% | | | 68% | | | 32% |
FY 2024E | | | 56% | | | 44% | | | 68% | | | 32% |
| | | | | | | | |||||
EBITDA(1): | | | | | | | | | ||||
FY 2022E | | | 41% | | | 59% | | | 48% | | | 52% |
FY 2023E | | | 42% | | | 58% | | | 49% | | | 51% |
FY 2024E | | | 42% | | | 58% | | | 49% | | | 51% |
| | | | | | | | |||||
Unlevered Net Income(1): | | | | | | | | | ||||
FY 2022E | | | 36% | | | 64% | | | 36% | | | 64% |
FY 2023E | | | 37% | | | 63% | | | 37% | | | 63% |
FY 2024E | | | 38% | | | 62% | | | 38% | | | 62% |
(1) | Assumes $37 million in standalone costs for the twelve months ended May 31, 2022 (as provided in the Neogen Internal Data). The Food Safety Business unlevered net income assumes a 20.5% tax rate for all years. |
| | | Fiscal Year Ending May 31, | | | | Fiscal Year Ending May 31, | |||||||||||||||||||||||||||||
$ million | | | 2H 2022E(1) | | 2022E | | 2023E | | 2024E | | 2025E | | 2026E | | | 2H 2022E(1) | | 2022E | | 2023E | | 2024E | | 2025E | | 2026E | ||||||||||
Revenue | | $257 | | $515 | | $567 | | $613 | | $663 | | $717 | | $257 | | $515 | | $567 | | $613 | | $663 | | $717 | ||||||||||||
EBITDA(2) | | 55 | | 110 | | 125 | | 140 | | 156 | | 175 | | 55 | | 110 | | 125 | | 140 | | 156 | | 175 | ||||||||||||
Unlevered Net Income(3) | | 34 | | 69 | | 79 | | 89 | | 100 | | 113 | | 34 | | 69 | | 79 | | 89 | | 100 | | 113 | ||||||||||||
Unlevered Free Cash Flow(4) | | 25 | | 61 | | 73 | | 83 | | 94 | | | 25 | | | 61 | | 73 | | 83 | | 94 |
(1) | Reflects estimates for the second half of Neogen’s fiscal year ending May 31, 2022. |
(2) | EBITDA is a non-GAAP financial measure and was calculated as earnings before interest, taxes, depreciation and amortization, including stock-based compensation expense. |
(3) | Unlevered net income is a non-GAAP financial measure and was calculated by Centerview for use in connection with its financial analyses for purposes of rendering its opinion to the Neogen Board as described above in the section entitled “—Opinion of Neogen’s Financial Advisor” using the Neogen Reforecasted Food Safety Projections provided by Neogen management as EBITDA, less depreciation and amortization, less cash tax expense. |
(4) | Unlevered free cash flow is a non-GAAP financial measure and was calculated by Centerview for use in connection with its financial analyses for purposes of rendering its opinion to the Neogen board as described above in the section entitled “—Opinion of Neogen’s Financial Advisor” using the Neogen Standalone Projections provided by Neogen management as net operating profit after taxes (i.e., EBITDA, less depreciation and amortization, less cash tax expense), plus depreciation and amortization, less capital expenditures, less increases in net working capital and less acquisition spend. |
| | | Fiscal Year Ending on May 31, | | | | Fiscal Year Ending on May 31, | |||||||||||||||||||||||||||||
$ million | | | 2H 2022E(1) | | 2022E | | 2023E | | 2024E | | 2025E | | 2026E | | | 2H 2022E(1) | | 2022E | | 2023E | | 2024E | | 2025E | | 2026E | ||||||||||
Revenue | | $202 | | $404 | | $440 | | $475 | | $507 | | $535 | | $202 | | $404 | | $440 | | $475 | | $507 | | $535 | ||||||||||||
EBITDA(2) | | 80 | | 160 | | 176 | | 193 | | 208 | | 221 | | 80 | | 160 | | 176 | | 193 | | 208 | | 221 | ||||||||||||
Unlevered Net Income(3) | | 61 | | 122 | | 134 | | 147 | | 158 | | 168 | | 61 | | 122 | | 134 | | 147 | | 158 | | 168 | ||||||||||||
Unlevered Free Cash Flow(4) | | 59 | | 71 | | 61 | | 116 | | 158 | | | 59 | | | 71 | | 61 | | 116 | | 158 |
(1) | Reflects estimate for the second half of fiscal year ending May 31, 2022 based on Neogen management’s recast of the unaudited prospective financial information for the Food Safety Business to correspond to a fiscal year ending May 31. |
(2) | EBITDA is a non-GAAP financial measure and was calculated as earnings before interest, taxes, depreciation and amortization, including stock-based compensation expense. |
(3) | Unlevered net income is a non-GAAP financial measure and was calculated by Centerview for use in connection with its financial analyses for purposes of rendering its opinion to the Neogen Board as described above in the section entitled “—Opinion of Neogen’s Financial Advisor” using the Neogen Reforecasted Food Safety Projections provided by Neogen management as EBITDA, less depreciation and amortization, less cash tax expense. |
(4) | Unlevered free cash flow is a non-GAAP financial measure and was calculated by Centerview for use in connection with its financial analyses for purposes of rendering its opinion to the Neogen board as described above in the section entitled “—Opinion of Neogen’s Financial Advisor” using the Neogen Reforecasted Food Safety Projections provided by Neogen management as net operating profit after taxes (i.e., EBITDA, less depreciation and amortization, less cash tax expense), plus depreciation and amortization, less capital expenditures, less increases in net working capital, less (with respect to the prospective financial information for fiscal years 2023 through 2026) certain estimates of one-time expenditures related to operational and facility transitions. |
| | Fiscal Year Ending December 31, | |||||||||||||
$ million | | | 2021E | | | 2022E | | | 2023E | | | 2024E | | | 2025E |
Net Sales | | | $373 | | | $414 | | | $454 | | | $494 | | | $532 |
Adjusted Gross Profit(1) | | | 237 | | | 268 | | | 296 | | | 323 | | | 349 |
Adjusted EBITDA(2) | | | 180 | | | 204 | | | 226 | | | 247 | | | 267 |
(1) | Adjusted gross profit is calculated as net sales less cost of goods sold, adjusted for stock-based compensation, parent expense allocations that would not apply to a standalone entity, and items of a non-recurring and/or non-operational nature, and is a non-GAAP financial measure. Standalone costs, including but not limited to, transition costs or new production startup have not been included. |
(2) | Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation and amortization, adjusted for stock-based compensation, parent expense allocations that would not apply to a standalone entity, and items of a non-recurring and/or non-operational nature and is a non-GAAP financial measure. Standalone costs, including but not limited to, transition costs or new production startup have not been included. |
• | approve or authorize, or cause or permit 3M or any of its subsidiaries to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle, option agreement, joint venture agreement, partnership agreement or similar agreement or document relating to, or providing for, any Garden SpinCo Proposal; provided that nothing in the Merger Agreement will limit 3M’s ability to pursue or engage in any transaction relating to substantially all of the business of 3M and its subsidiaries, taken as a whole (as opposed to solely the Food Safety Business), so long as such transaction would not prevent or materially impair or materially delay 3M’s ability to comply with its obligations hereunder and under the Separation Agreement or to consummate the transactions contemplated thereby or by the Separation Agreement. |
• | approve or authorize, or cause or permit 3M or any of its subsidiaries to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle, option agreement, joint venture agreement, partnership agreement or similar agreement or document relating to, or providing for, any Garden SpinCo Proposal; provided that nothing in the Merger Agreement will limit 3M’s ability to pursue or engage in any transaction relating to substantially all of the business of 3M and its subsidiaries, taken as a whole (as opposed to solely the Food Safety Business), so long as such transaction would not prevent or materially impair or materially delay 3M’s ability to comply with its obligations hereunder and under the Separation Agreement or to consummate the transactions contemplated thereby or by the Separation Agreement. |
• | approve or authorize, or cause or permit 3M or any of its subsidiaries to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle, option agreement, joint venture agreement, partnership agreement or similar agreement or document relating to, or providing for, any Garden SpinCo Proposal; provided that nothing in the Merger Agreement will limit 3M’s ability to pursue or engage in any transaction relating to substantially all of the business of 3M and its subsidiaries, taken as a whole (as opposed to solely the Food Safety Business), so long as such transaction would not prevent or materially impair or materially delay 3M’s ability to comply with its obligations hereunder and under the Separation Agreement or to consummate the transactions contemplated thereby or by the Separation Agreement. |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
Authorized Capital Stock | | | Under Neogen’s articles of incorporation, Neogen’s authorized capital stock consists of 240,000,000 shares of common stock, par value $0.16 per share, and 100,000 shares of preferred stock, par value $1.00 per share. Following the Neogen charter amendment, which is a condition to the closing of the Merger, Neogen will have 315,000,000 shares of common stock authorized. | | | The authorized capital stock of 3M consists of 3,000,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, without par value. |
| | | | |||
Preferred Stock | | | Neogen’s articles of incorporation authorize the Neogen board, without further action by Neogen’s shareholders, to issue shares of preferred stock in one or more series and to fix by resolution the number of shares constituting any such series and the designations, preferences and relative, participating, optional or other special rights, and such qualifications, limitations or restrictions thereof, including, without limitation, voting rights, redemption rights, dividend rights, liquidation preferences and conversion or exchange rights of any class or series of preferred stock. | | | 3M’s amended and restated certificate of incorporation provides that the 3M board may authorize the issuance of one or more series of preferred stock for such consideration and with the designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations, or restrictions thereof, as will be determined by the 3M board and fixed by resolution or resolutions adopted by the 3M board, which provide for the number of shares in each series. |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
Dividends | | | Under Neogen’s bylaws and subject to Section 345 of the MBCA, the Neogen board may declare dividends from time to time out of any funds legally available therefor. | | | 3M’s amended and restated certificate of incorporation provides that the 3M board is expressly authorized to set apart out of any funds of 3M available for dividends a reserve or reserves for any proper purpose and to abolish such reserve in the manner in which it was created. |
| | | | |||
Special Meetings of Stockholders | | | Under Neogen’s bylaws, special meetings of Neogen shareholders may be called only by the President, by a majority of the Neogen board, or by shareholders entitled to vote not less than an aggregate of fifty percent (50%) of the outstanding shares of any class of stock having the right to vote at such special meeting. Nonetheless, under the MBCA, upon application of the holders of not less than ten percent (10%) of all the shares entitled to vote at a meeting, the circuit court of the county in which the principal place of business or registered office is located, for good cause shown, may order a special meeting of shareholders to be called and held. | | | 3M’s amended and restated bylaws provide that special meetings of the stockholders for any purpose may be called at any time (i) by the 3M board; (ii) any of the following persons with the concurrence of a majority of the 3M board: the chairman of the board, the chief executive officer or the secretary; or (iii) upon written request to the secretary of one or more record holders of shares of stock of 3M representing in the aggregate not less than twenty-five (25%) of the total number of shares of stock entitled to vote on the matter or matters to be brought before the special meeting. |
| | | | |||
Special Meetings of the Board of Directors | | | Under Neogen’s bylaws, special meetings of the Neogen board may be called by the President, or by any member of the Neogen board, at any time by means of written or personal notice of the time and place thereof to each director. | | | 3M’s amended and restated bylaws provide that special meetings of the 3M board may be held at any time whenever called by the chairman of the 3M board, if any, or by any two directors. |
| | | | |||
Quorum and Manner of Acting at Meetings of the Board | | | A majority of the directors of the Neogen board constitutes a quorum. The vote of a majority of the directors present at any meeting at which there is a quorum will be the act of the Neogen board, except as specifically provided under the MBCA. | | | 3M’s amended and restated bylaws provide that a majority of directors will constitute a quorum for the transaction of business. The vote of a majority of the members present at any meeting at which a quorum is present, will be the act of the 3M board, except as may be otherwise specifically provided by statute or by the 3M amended and restated certificate of incorporation or amended and restated bylaws. If a quorum shall not be present at any meeting of the 3M board, the members present may adjourn the meeting from time to time until a quorum shall attend. |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
Stockholder Action by Written Consent | | Neogen’s articles of incorporation provide that any action required or permitted to be taken by Neogen shareholders at a meeting of shareholders may be taken without a meeting if a consent in writing, setting forth such action, is signed by every shareholder entitled to vote on the matter. In addition, any other shareholder entitled to notice of the meeting (but not to vote thereat) has waived in writing any right to dissent from such action. | | | 3M’s amended and restated certificate of incorporation prohibits action required to be taken or which may be taken at any annual or special meeting of stockholders from being taken without a meeting and specifically denies the power of stockholders to consent in writing without a meeting, to the taking of any action. | |
| | | | |||
Advance Notice or Other Procedures for Stockholder Proposals and Nominations of Candidates for Election to the Board of Directors | | | Under Neogen’s bylaws, shareholders who wish to make a proposal or nominate directors at an annual meeting of shareholders must notify Neogen no later than the sixtieth (60th) day nor earlier than the ninetieth (90th) day prior to the first anniversary of the date of the preceding year’s annual meeting. However, in the event that an annual meeting is called for a date that is more than thirty (30) days before or more than sixty (60) days after such anniversary (or if Neogen has not previously held an annual meeting), then a shareholder’s notice must be delivered not earlier than the close of business on the ninetieth (90th) day prior to such annual meeting or not later than the close of business on the later of the sixtheith (60th) day prior to such annual meeting or the 10th day following the day on which Neogen first publicly announced the meeting date in order to be timely. If Neogen calls a special meeting of shareholders for the purpose of electing one or more directors to the Neogen board, a shareholder may nominate directors for election as specified in Neogen’s notice of meeting if such shareholder provides notice no earlier than the close of business on the ninetieth (90th) day prior to such special meeting and no later than the close of business on the later of the sixtieth (60th) day prior to such special meeting or the tenth (10th) day following the day on which the date of the special meeting and the board’s nominees are first publicly announced. | | | 3M’s amended and restated bylaws provide that stockholders who (i) are record holders on the date of the giving of the notice described below, on the applicable record date and on the date of the annual meeting, (ii) are entitled to vote at the meeting and (iii) complied with the notice procedures set forth in the bylaws. The procedures require timely notice in writing to 3M’s secretary and that any such proposed business must constitute a proper matter for stockholder action. Such proposals and nominations (other than stockholder proposals included in the proxy materials pursuant to Rule 14a-8 promulgated under the Exchange Act) may only be made in accordance with the applicable provision of the bylaws. To be timely, a stockholder’s notice shall be delivered to and received by the Secretary at the principal executive offices of 3M not later than the close of business on the ninetieth (90th) day, nor earlier than the close of business on the one hundred twentieth (120th) day, prior to the first anniversary of the preceding year’s definitive proxy statement filing date with respect to such year’s annual meeting (provided, however, that in the event that the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after such anniversary date, notice by the stockholder must be so delivered not earlier than the close of business on |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | | | the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such meeting is first made by 3M). In addition, to be considered timely, a stockholder’s notice shall further be updated and supplemented, if necessary, so that the information provided or required to be provided in such notice shall be true and correct as of the record date for the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to the Secretary at the principal executive offices of 3M not later than five (5) business days after the record date for the meeting in the case of the update and supplement required to be made as of the record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof. | ||
| | | | |||
| | | | |||
Number of Directors and Composition of the Board of Directors | | | Neogen’s articles of incorporation and Neogen’s bylaws provide that the total number of Neogen directors will be not less than five (5) and no more than nine (9), the exact number of which shall be fixed from time to time by the Neogen board. Following the Neogen charter amendment and bylaws amendment, if approved and which are conditions to the closing of the merger, the maximum size of the board will be eleven (11) directors. The Neogen board is divided into three classes with staggered three (3)-year terms. The three classes designated as Class I, Class II, and Class III are each required to be as nearly equal in number as possible. | | | The DGCL provides that the board of directors of a Delaware corporation must consist of one or more directors, each of whom must be a natural person, with the number of directors fixed by or in the manner provided in the corporation’s bylaws, unless the certificate of incorporation fixes the number of directors. 3M’s amended and restated bylaws and amended and restated certificate of incorporation provide that the 3M board will consist of such number of directors as may be fixed from time to time by resolution of the 3M board. The 3M corporate governance guidelines state that the 3M board |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | | | believes in having a substantial majority of “independent: directors on the 3M board. A director is “independent” if the 3M board affirmatively determines that the director has no material relationship with 3M directly or as a partner, a shareholder, or officer of an organization that has a relationship with 3M and otherwise meets the requirements for independent of the listing standards of the NYSE. The 3M corporate governance guidelines also require the audit, compensation nominating and governance and science, technology & sustainability committees of the 3M board to be comprised solely of independent directors. There are currently thirteen (13) directors serving on the 3M board. | ||
| | | | |||
Voting Rights, Election of Directors | | | Under Neogen’s bylaws, Neogen shareholders are entitled to one vote per share of common stock on all matters duly submitted to shareholders for their vote. Voting rights with regards to any series of Neogen preferred stock will be as determined by the Neogen board for such series. Neogen directors will be elected by a plurality of the votes cast at any shareholders meeting at which directors are to be elected. The right to cumulate votes in the election of directors does not exist with respect to shares of Neogen common stock. | | | 3M’s amended and restated bylaws and amended and restated certificate of incorporation provide that each holder of 3M common stock shall be entitled to one vote per share of common stock. 3M’s amended and restated certificate of incorporation provides that directors shall be elected annually and shall hold office for a term expiring at the next annual meeting of Stockholders and until their respective successors shall have been duly elected and qualified. 3M’s directors are elected by a majority of votes cast with respect to that director’s election (which means that the number of votes cast “for” a director’s election exceeds the number of votes cast “against” that director’s election, (with abstentions and broker non-votes not counted as a vote cast either “for” or “against” that director’s election) at any meeting for the election of directors at which a quorum is present; provided that, if the number of nominees exceeds the number of directors to be elected, the directors will be elected by the vote of a plurality of the votes cast. |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
Removal of Directors | | | Neogen’s bylaws provide that a director or the entire board may be removed only for cause. Removal will require the affirmative vote of holders of a majority of the shares entitled to vote at an election of directors. | | | 3M’s amended and restated certificate of incorporation provides that directors may be removed with or without cause. 3M’s amended and restated bylaws provide that any director may resign at any time upon written notice to the 3M board or to the chairman or to the secretary. |
| | | | |||
Vacancies on the Board of Directors | | | Neogen’s bylaws provide that any vacancy or newly created directorship on the Neogen board, however occurring, may be filled by a majority vote of the Neogen board. | | | 3M’s amended and restated bylaws provide that newly created directorships resulting from an increase in the number of directors and vacancies occurring in the 3M board resulting from death, resignation, retirement, removal, or any other reason shall be filled by the affirmative vote of a majority of the 3M board, although less than a quorum, then remaining in office and elected by the holders of the capital stock of 3M entitled to vote generally in the election of directors or, in the event that there is only one such director, by such sole remaining director |
| | | | |||
Chairman Positions | | | Under the MBCA, a chairman of the board of directors of a corporation may be appointed as prescribed in the corporation’s bylaws or as determined by the board. Neogen’s bylaws do not contain any specific provisions relating to the appointment of a chairman. James C. Borel, who is an independent director, is the current chairman of the Neogen board. | | | 3M’s amended and restated bylaws provide that the chairman of the 3M board will preside at all meetings of the stockholders and the 3M board. Michael Roman, the current Chief Executive Officer of 3M, is the chairman of the 3M board. |
| | | | |||
Limitation on Liability of Directors | | | As permitted by the MBCA, Neogen’s articles of incorporation provide that the directors of Neogen will not be personally liable to Neogen or its shareholders for monetary damages for breach of fiduciary duty as a director, except liability for any of the following: (i) the amount of a financial benefit received by a director to which he or she is not entitled; (ii) intentional infliction of harm on the corporation or | | | The DGCL provides that a corporation may limit or eliminate a director’s personal liability for monetary damages to the corporation or its stockholders for a breach of fiduciary duty as a director, except for liability for (i) a director’s breach of the duty of loyalty to the corporation or its stockholders, (ii) acts or omissions not in good faith or which involve intentional |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | the shareholders; (iii) a violation of Section 551 of the MBCA; and (iv) an intentional criminal act. | | | misconduct or a knowing violation of law, (iii) willful or negligent violation of provisions of Delaware law governing payment of dividends and stock purchases or redemptions, or (iv) any transaction from which the director derived an improper personal benefit. In accordance with the DGCL, 3M’s amended and restated certificate of incorporation provides that the liability of 3M directors shall be eliminated to the fullest extent permitted by the DGCL. If the DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, the liability of 3M directors will be eliminated or limited to the fullest extent permitted by the DGCL, as amended. | |
| | | | |||
Indemnification of Directors and Officers | | | Under the MBCA, a corporation must indemnify any director or officer who has been successful on the merits or otherwise in defense of an action, suit, or proceeding (or any claim, issue or matter in any action, suit or proceeding) brought against him or her by reason of the fact that he or she is or was a director or officer of the corporation, against actual and reasonable expenses, including attorneys’ fees, incurred by him or her in connection therewith, as well as in any proceeding brought to enforce the corporation’s mandatory indemnification obligations. The MBCA provides that a corporation may indemnify a person who was or is a party or is threatened to be made a party to a threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal, other than an action by or in the right of the corporation, by reason of the fact that he or she is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, trustee, | | | Under the DGCL, a Delaware corporation must indemnify any present or former director and officer against expenses (including attorneys’ fees) actually and reasonably incurred to the extent that the officer or director has been successful on the merits or otherwise in defense of any action, suit or proceeding brought against him or her by reason of the fact that he or she is or was a director or officer of the corporation. Delaware law provides that a corporation may indemnify any present and former director, officer, employee or agent, as well as any individual serving with another corporation in that capacity at the corporation’s request against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement of actions taken, if the individual acted in good faith and in a manner reasonably believed to be in, or not opposed to, the best interests of the corporation and, in the case of a criminal proceeding, the individual had no reasonable cause to believe the individual’s conduct was |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses, including attorneys’ fees, judgments, penalties, fines, and amounts paid in settlement actually and reasonably incurred by him or her in connection with the action, suit, or proceeding, if the person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation or its shareholders, and with respect to a criminal action or proceeding, if the person had no reasonable cause to believe his or her conduct was unlawful. Neogen’s bylaws also provide that Neogen will indemnify its directors and officers for liabilities arising out of their positions to the fullest extent permitted by law. | | | unlawful. However, no indemnification may be paid for judgments and settlements in actions by or in the right of the corporation. Under the DGCL, a corporation may not indemnify a current or former director or officer of the corporation against expenses to the extent that the person is adjudged to be liable to the corporation unless a court approves the indemnity. The DGCL permits a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of a corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such. 3M’s amended and restated bylaws provide that 3M will indemnify to the full extent authorized or permitted by law any person made or threatened to be made a party to any action, suit, or proceeding, whether criminal, civil, administrative, or investigative, by reason of the fact that such person or such person’s testator or intestate is or was a director, officer, or employee of 3M or serves or served at the request of 3M any other enterprise as a director, officer, or employee. Expenses incurred by any such person in defending any such action, suit, or proceeding shall be paid or reimbursed by 3M promptly upon receipt by it of an undertaking of such person to repay such expenses if it shall ultimately be determined that such person is not entitled to be indemnified by 3M. The amended and restated bylaws further provided |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | | | that these indemnification rights shall be enforceable against 3M by such person who shall be presumed to have relied upon it in serving or continuing to serve as a director, officer, or employee. No amendment to the bylaws shall impair the rights of any person arising at any time with respect to events occurring prior to such amendment. 3M’s amended and restated bylaws further provide that 3M may maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity or arising out of his or her status as such, whether or not 3M would have the power to indemnify him or her against such liability under the provisions of the bylaws. | ||
| | | | |||
Amendments to Certificate/Articles of Incorporation | | | The MBCA generally permits amendments to the articles of incorporation if those amendments are approved by the board of directors and adopted by the affirmative vote of a majority of the outstanding shares entitled to vote on the proposed amendment, unless the MBCA or the articles of incorporation require a higher voting requirement for any specific amendment. Neogen’s articles of incorporation do not provide for any different approval requirements for amendment. | | | Under the DGCL, an amendment to the certificate of incorporation generally requires (1) the approval of the board of directors, (2) the approval of a majority of the voting power of the outstanding stock entitled to vote upon the proposed amendment and (3) the approval of the holders of a majority of the outstanding stock of each class entitled to vote thereon as a class, if any. 3M’s amended and restated certificate of incorporation provides that 3M reserves the right to amend the 3M amended and restated certificate of incorporation in any manner permitted by the DGCL, as amended from time to time. |
| | | | |||
Amendments to Bylaws | | | Neogen’s bylaws provide that the bylaws may be amended solely by the affirmative vote of a majority of the outstanding shares of each class of stock entitled to vote. | | | 3M’s amended and restated bylaws provide that the 3M board will have the power to adopt, amend or repeal the 3M amended and restated bylaws. 3M’s stockholders will have the power to rescind, alter, amend or |
Shareholder Right | | | Rights of Neogen Shareholders | | | Rights of 3M Stockholders |
| | Under the Merger Agreement, Neogen is entitled to seek approval of any amendment to its bylaws in connection with the Transactions that would allow the Neogen board to amend the bylaws or adopt new bylaws without shareholder approval. | | | repeal any bylaws made by the 3M board. Notice of the proposal to amend any provision of the 3M amended and restated bylaws must be included in the notice of any meeting of the stockholders at which the action is to be considered. | |
| | | | |||
Certain Business Combinations | | | Sections 780 to 784 of the Michigan Business Corporation Act contain Michigan’s fair price statute, which provide that, in addition to any other vote required by the MBCA or a company’s articles of incorporation, a Michigan corporation subject to the statute cannot engage in any business combination with an interested shareholder (generally, a beneficial owner of 10% or more of the voting power of the corporation), unless (a) the board of directors issues an advisory statement in favor of the business combination, and (b) the business combination is approved by at least (i) 90% of the votes of each class of stock that is entitled to vote and (ii) two-thirds of the votes of each class of stock entitled to vote, excluding any shares that are beneficially owned by the interested shareholder or any affiliate or associate of the interested shareholder. This shareholder approval requirement does not apply if (1) the board of the directors of the corporation approves or exempts the transaction with a particular interested shareholder from such requirements prior to the time the person became an interested shareholder or (ii) certain minimum price and specified fairness conditions are satisfied, and the person involved in the business combination has been an interested shareholder for at least five (5) years. | | | Section 203 of the DGCL prohibits a Delaware corporation from engaging in a business combination with a stockholder acquiring more than 15% but less than 85% of the corporation’s outstanding voting stock for three years following the time that person becomes an “interested stockholder” (a holder of more than 15% of the corporation’s outstanding shares), unless prior to the date the person becomes an interested stockholder, the board of directors approves either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder or the business combination is approved by the board of directors and by the affirmative vote of at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder, or other specified exceptions are met. The DGCL allows a corporation’s certificate of incorporation to contain a provision expressly electing not to be governed by Section 203 of the DGCL. 3M’s amended and restated certificate of incorporation does not contain a provision electing to “opt-out” of Section 203 of the DGCL and therefore 3M remains subject to such provision. |
| | | | |||
Stockholder Rights Plan | | | Neogen does not have a shareholder rights plan currently in effect. | | | 3M does not have a stockholder rights plan currently in effect. |
Name and Address of Beneficial Owner | | | Number of Shares Beneficially Owned | | | Percent of Class |
BlackRock Inc.(1) 55 East 52nd Street New York, NY 10055 | | | 11,649,436 | | | 10.8% |
| | | | |||
Brown Capital Management, LLC(2) 1201 N. Calvert Street Baltimore, MD 21202 | | | 11,899,239 | | | 11.04% |
| | | | |||
The Vanguard Group(3) 100 Vanguard Blvd. Malvern, PA 19355 | | | 10,584,111 | | | 9.82% |
| | | | |||
Wasatch Advisors(4) 505 Wakara Way Salt Lake City, UT 84108 | | | 6,984,315 | | | 6.5% |
(1) | Based on Amendment No. 14 to Schedule 13G filed with the SEC on January 27, 2022. The report includes holdings of BlackRock, Inc. and certain of its subsidiaries as of December 31, 2021, and includes ownership of more than 5% of the outstanding shares of Neogen common stock by Black Rock Fund Advisors. Based on the report, BlackRock, Inc. has sole voting power with respect to 11,470,377 shares of Neogen common stock and the sole power to dispose of 11,649,436 shares of Neogen common stock. |
(2) | Based on Amendment No. 16 to Schedule 13G filed with the SEC on February 14, 2022. The report includes holdings of Brown Capital Management, LLC and certain of its investment advisory clients as of December 31, 2021, and includes ownership of more than 5% of the outstanding shares of Neogen common stock by Brown Capital Management Small Company Fund. Based on the report, Brown Capital Management, LLC has sole voting power with respect to 8,099,635 shares of Neogen common stock and the sole power to dispose of 11,899,239 shares of Neogen common stock, and Brown Capital Management Small Company Fund has sole voting power and sole dispositive power with respect to 7,095,028 shares. |
(3) | Based on Amendment No. 11 to Schedule 13G filed with the SEC on February 10, 2022. Based on the report, as of December 31, 2021, The Vanguard Group had sole voting power with respect to 0 shares of Neogen common stock, shared voting power with respect to 196,506 shares of Neogen common stock, sole dispositive power with respect to 10,291,473 shares of Neogen common stock and shared dispositive power with respect to 292,638 shares of Neogen common stock. |
(4) | Based on Schedule 13G filed with the SEC on February 11, 2022, with respect to ownership as of December 31, 2021. |
Name of Beneficial Owners(1) | | Number of Shares Beneficially Owned(2) | | Shares Acquirable Within 60 Days(3) | | Total Beneficial Ownership | | Percent of Class | | Number of Shares Beneficially Owned(2) | | Shares Acquirable Within 60 Days(3) | | Total Beneficial Ownership | | Percent of Class | ||||||||
Directors | | | | | | | | | ||||||||||||||||
John E. Adent(4) | | 43,727 | | 142,750 | | 186,477 | | * | | 58,103 | | 222,748 | | 280,857 | | * | ||||||||
William T. Boehm, Ph.D. | | 21,242 | | 42,260 | | 63,502 | | * | | 21,242 | | 42,260 | | 63,502 | | * | ||||||||
James C. Borel | | 4,284 | | 32,594 | | 36,878 | | * | | 11,773 | | 32,594 | | 44,367 | | * | ||||||||
Ronald D. Green, Ph.D. | | 3,664 | | 37,040 | | 40,704 | | * | | 3,664 | | 37,040 | | 40,704 | | * | ||||||||
Ralph A. Rodriguez | | 284 | | 1,260 | | 1,544 | | * | | 284 | | 1,260 | | 1,544 | | * | ||||||||
James P. Tobin | | 12,284 | | 32,594 | | 44,878 | | * | | 14,284 | | 32,594 | | 46,878 | | * | ||||||||
Darci L. Vetter | | 284 | | 24,594 | | 24,878 | | * | | 284 | | 24,594 | | 24,878 | | * | ||||||||
Catherine E. Woteki, Ph.D. | | 284 | | 1,260 | | 1,544 | | * | | 284 | | 1,260 | | 1,544 | | * | ||||||||
Named Executive Officers | | | | | | | | | ||||||||||||||||
Douglas E. Jones | | 2,759 | | 3,954 | | 6,713 | | * | | 2,759 | | 3,954 | | 6,713 | | * | ||||||||
Jason W. Lilly, Ph.D.(5) | | 20,838 | | 46,056 | | 66,894 | | * | | 20,838 | | 46,056 | | 66,894 | | * | ||||||||
Jerome L. Hagedorn | | 1,282 | | 28,856 | | 30,138 | | * | | 1,499 | | 28,856 | | 30,355 | | * | ||||||||
Steven J. Quinlan(6) | | 27,737 | | 101,774 | | 129,511 | | * | | 27,737 | | 101,774 | | 129,511 | | * | ||||||||
All Directors and Executive Officers as a Group (12 persons) | | 138,669 | | 494,992 | | 663,661 | | * | | 162,751 | | 574,990 | | 737,741 | | * |
* | Less than 1% of the outstanding shares of Neogen common stock. |
(1) | The address of each beneficial owner listed is c/o Neogen Corporation, 620 Lesher Place, Lansing, MI 48912. |
(2) | Unless otherwise indicated and subject to applicable community property laws, each person in the table has sole voting and investment power over the shares listed. |
(3) | Includes shares that may be acquired within 60 days after |
(4) | Includes 2,707 shares of Neogen common stock held in the Neogen Corporation 401(k) Retirement Savings Plan. |
(5) | Includes 11,672 shares of Neogen common stock held in the Neogen Corporation 401(k) Retirement Savings Plan. |
(6) | Includes |
Name and principal position | | Stock(1) | | Restricted Stock Units(2) | | Deferred Stock(3) | | Total(4) | | Percent of Class | | Stock(1) | | Restricted Stock Units(2) | | Deferred Stock(3) | | Total(4) | | Percent of Class | ||||||||||
Thomas “Tony” K. Brown, Director | | 1,249 | | — | | 8,230 | | 9,479 | | (5) | | 1,263 | | — | | 9,546 | | 10,809 | | (5) | ||||||||||
Pamela J. Craig, Director | | — | | — | | 3,257 | | 3,257 | | (5) | | — | | — | | 4,519 | | 4,519 | | (5) | ||||||||||
David B. Dillon, Director | | 1,200 | | — | | 6,776 | | 7,976 | | (5) | | 1,200 | | — | | 8,077 | | 9,277 | | (5) | ||||||||||
Michael L. Eskew, Director | | — | | — | | 50,701 | | 50,701 | | (5) | | — | | — | | 52,789 | | 52,789 | | (5) | ||||||||||
James R. Fitterling, Director | | 6,300 | | — | | 1,415 | | 7,715 | | (5) | | 6,300 | | — | | 2,898 | | 9,198 | | (5) | ||||||||||
Herbert L. Henkel, Director | | — | | — | | 44,226 | | 44,226 | | (5) | ||||||||||||||||||||
Amy E. Hood, Director | | 24 | | — | | 4,487 | | 4,511 | | (5) | | 24 | | — | | 5,763 | | 5,787 | | (5) | ||||||||||
Muhtar Kent, Director | | 263 | | — | | 17,756 | | 18,019 | | (5) | | 1,769 | | — | | 17,948 | | 19,717 | | (5) | ||||||||||
Suzan Kereere, Director | | — | | — | | 284 | | 284 | | (5) | | — | | — | | 1,515 | | 1,515 | | (5) | ||||||||||
Dambisa F. Moyo, Director | | 1,313 | | — | | 2,286 | | 3,599 | | (5) | | 1,324 | | — | | 3,538 | | 4,862 | | (5) | ||||||||||
Gregory R. Page, Director | | 4,000 | | — | | 7,755 | | 11,755 | | (5) | | 4,000 | | — | | 9,066 | | 13,066 | | (5) | ||||||||||
Patricia A. Woertz, Director | | 2,580 | | — | | 5,256 | | 7,836 | | (5) | ||||||||||||||||||||
Michael F. Roman, Chairman of the Board and Chief Executive Officer | | 661,388 | | — | | 68,635 | | 730,023 | | (5) | | 650,778 | | — | | 69,331 | | 720,109 | | (5) | ||||||||||
Monish Patolawala, Executive Vice President, Chief Financial and Transformation Officer | | 29,473 | | 47,205 | | — | | 76,678 | | (5) | | 32,822 | | 41,192 | | — | | 74,014 | | (5) | ||||||||||
Ashish K. Khandpur, Group President, Transportation and Electronics Business Group | | 221,211 | | 12,271 | | 18,442 | | 251,924 | | (5) | | 221,221 | | 12,271 | | 18,629 | | 252,121 | | (5) | ||||||||||
Mojdeh Poul, Group President, Health Care Business Group | | 108,101 | | 14,962 | | 5,166 | | 128,229 | | (5) | ||||||||||||||||||||
Michael G. Vale, Group President, Safety and Industrial Business Group | | 364,063 | | — | | 40,376 | | 404,439 | | (5) | | 364,241 | | — | | 40,785 | | 405,026 | | (5) | ||||||||||
All Directors and Executive Officers as a Group (25 persons) | | 1,787,563 | | 119,787 | | 299,051 | | 2,206,401 | | (5) | ||||||||||||||||||||
All Directors and Executive Officers as a Group (22 persons) | | 1,671,440 | | 106,595 | | 258,549 | | 2,036,584 | | (5) |
(1) | This column lists beneficial ownership of 3M common stock as calculated under SEC rules. Unless otherwise noted, voting power and investment power in the shares are exercisable solely by the named person, and none of the shares are pledged as security by the named person. In accordance with SEC rules, this column also includes shares that may be acquired pursuant to stock options that are or will be exercisable within 60 days of |
(2) | This column reflects restricted stock units that generally vest over a three- to five-year period, assuming continued employment until each vesting date (or until the individual retires from 3M, in some cases). The executive officers do not have voting power with respect to the shares listed in this column. |
(3) | This column reflects shares earned by the directors as a result of their service on the 3M board, the payout of which has been deferred until following the termination of their membership on the 3M board. This column also includes shares of 3M’s common stock which the executive officers are entitled to receive following their retirement from 3M as a result of their election to defer all or a portion of the payout of their performance share awards granted under 3M’s long-term incentive plan. Neither the directors nor the executive officers have voting power with respect to the shares listed in this column. |
(4) | This column shows the individual’s total 3M stock-based holdings, including the securities shown in the “Stock” column (as described in note 1), in the “Restricted Stock Units” column (as described in note 2), and in the “Deferred Stock” column (as described in note 3). |
(5) | Each director and executive officer individually, and All Directors and Executive Officers as a Group, beneficially owned less than one percent of the outstanding common stock of 3M. |
Name and Address of Beneficial Owner | | | Common Stock Beneficially Owned | | | Percentage of 3M Common Stock Beneficially Owned |
5% Stockholders: | | | | | ||
| | | | |||
The Vanguard Group Inc.(1) 100 Vanguard Blvd. Malvern, PA 19355 | | | 50,240,763 | | | 8.72% |
| | | | |||
BlackRock, Inc.(2) 55 East 52nd Street New York, NY 10055 | | | 41,810,186 | | | 7.30% |
| | | | |||
State Street Corporation(3) State Street Financial Center One Lincoln Street Boston, MA 02111 | | | 30,984,983 | | | 5.38% |
(1) | In a Schedule 13G/A filed with the SEC on February 9, 2022, The Vanguard Group reported that, as of December 31, 2021, it had shared voting power with respect to 897,239 shares, sole dispositive power with respect to 47,926,223 shares, and shared dispositive power with respect to 2,314,540 shares. Vanguard provides investment management services to 3M’s defined contribution plans in the U.S. through a co-mingled mutual fund vehicle. The 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan use this investment in their defined contribution investment choices. Fees paid for investment management of the fund are incorporated into the fund NAV on a daily basis and fully disclosed as an expense ratio for the fund. As a result, these fees are paid by participants in 3M’s defined contribution plans and are not paid by 3M. The fees paid are reviewed by the fiduciaries of the employee benefit plans and are determined to be reasonable for the services provided. |
(2) | In a Schedule 13G/A filed with the SEC on February 1, 2022, BlackRock, Inc. reported that, as of December 31, 2021, it had sole voting power with respect to 36,218,909 shares and sole dispositive power with respect to 41,810,186 shares, of which 27,341 shares were held as investment manager for the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan. BlackRock, Inc. and its affiliates provide investment management services to several employee benefit plans sponsored by 3M and its Canadian affiliate. The 3M Voluntary Investment Plan and Employee Stock Ownership Plan, the 3M Savings Plan and the 3M Canada Company Master Trust utilize these investment management services. In total, the various employee benefit plans paid fees of $2.8 million in 2021 to BlackRock, Inc. and its affiliates, a majority of which was paid by the participants in the 3M Voluntary Investment Plan and Employee Stock Ownership Plan. In addition, the Trustee (BlackRock Institutional Trust Company, N.A.) will charge the funds held by the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan an annual administration fee and transaction fees which are incorporated into the funds’ NAV. The fees paid are reviewed by the fiduciaries of the employee benefit plans and are determined to be reasonable for the services provided. |
(3) | In a Schedule 13G/A filed with the SEC on February 9, 2022, State Street Corporation reported that, as of December 31, 2021, it had shared voting power with respect to 22,358,548 shares of 3M common stock and shared dispositive power with respect to 30,979,936 shares of 3M common stock. Of these shares, 38,293 shares were held as investment manager for certain 3M savings plans, including the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan, which are 401(k) retirement savings plans. State Street Bank and Trust Company provides corporate finance services to 3M. The 3M Voluntary Investment Plan and Employee Stock Ownership Plan, the 3M Savings Plan, and the 3M Retiree Welfare Benefit Plan utilize State Street Global Advisors, an affiliate of State Street Bank and Trust Company, as an investment manager. Further, State Street Bank and Trust Company is a participant of 3M Company’s $3 billion five-year credit agreement dated November 15, 2019. In total, 3M and the various employee benefit plans paid fees of $0.6 million in 2021 to State Street Bank and Trust Company and its affiliates, a majority of which was paid by the participants in the 3M Voluntary Investment Plan and Employee Stock Ownership Plan. In addition, during 2021, the Trustee charged the funds held by the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan an annual administration fee and transaction fees which are incorporated into the funds’ NAV. The fees paid are reviewed by 3M or fiduciaries of the employee benefit plans and are determined to be reasonable for the services provided. |
• | 3M’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 9, 2022 (as updated by the Form 8-K filed on April 26, |
• | 3M's Quarterly Reports on Form 10-Q filed with the SEC on April 26, 2022 and July 27, 2022; |
• | the information specifically incorporated by reference into 3M’s Annual Report on Form 10-K for the year ended December 31, 2021 from 3M’s Definitive Proxy Statement on Schedule 14A filed with the SEC on March 23, 2022; and |
• | 3M’s Current Reports on Form 8-K filed with the SEC on February 9, 2022 |
• | Neogen’s Annual Report on Form 10-K for the year ended May 31, |
• | the information specifically incorporated by reference into Neogen’s Annual Report on Form 10-K for the year ended May 31, 2021 from Neogen’s Definitive Proxy Statement on Schedule 14A filed with the SEC on August 31, |
| | Beginning Page | |
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
Annual Food Safety Business Combined Financial Statements | | | |
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
| | Three months ended March 31, | ||||
(In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Net sales | | | $91,621 | | | $85,517 |
Operating expenses | | | | | ||
Cost of sales | | | 36,229 | | | 32,116 |
Selling, general and administrative expenses | | | 22,111 | | | 19,964 |
Research, development and related expenses | | | 6,335 | | | 6,036 |
Total operating expenses | | | 64,675 | | | 58,116 |
Income before income taxes | | | 26,946 | | | 27,401 |
Provision for income taxes | | | 5,650 | | | 5,558 |
Net income | | | $21,296 | | | $21,843 |
| | Three months ended March 31, | ||||
(In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Net income | | | $21,296 | | | $21,843 |
Other comprehensive income (loss), net of tax: | | | | | ||
Cumulative translation adjustment | | | 266 | | | (2,667) |
Total other comprehensive income (loss), net of tax | | | 266 | | | (2,667) |
Comprehensive income (loss) | | | $21,562 | | | $19,176 |
(In thousands of U.S. dollars) | | | March 31, 2022 | | | December 31, 2021 |
Assets | | | | | ||
Current assets | | | | | ||
Cash | | | $— | | | $— |
Accounts receivable — net of allowances of $931 and $882 | | | 51,129 | | | 47,781 |
Inventories | | | | | ||
Finished goods | | | 22,992 | | | 21,632 |
Work in process | | | 5,872 | | | 5,614 |
Raw materials and supplies | | | 7,306 | | | 7,876 |
Total inventories | | | 36,170 | | | 35,122 |
Other current assets | | | 5,176 | | | 5,227 |
Total current assets | | | 92,475 | | | 88,130 |
Property, plant and equipment | | | 54,411 | | | 54,594 |
Less: Accumulated depreciation | | | (31,532) | | | (31,032) |
Property, plant and equipment — net | | | 22,879 | | | 23,562 |
Operating lease right of use assets | | | 1,268 | | | 1,403 |
Goodwill | | | 81,134 | | | 81,046 |
Intangible assets — net | | | 3,092 | | | 3,250 |
Deferred tax assets — non-current | | | 3,836 | | | 3,836 |
Other assets | | | 1,433 | | | 1,289 |
Total assets | | | $206,117 | | | $202,516 |
Liabilities | | | | | ||
Current liabilities | | | | | ||
Accounts payable | | | $10,084 | | | $8,497 |
Accrued payroll | | | 1,305 | | | 3,641 |
Operating lease liabilities — current | | | 346 | | | 357 |
Other current liabilities | | | 3,550 | | | 3,979 |
Total current liabilities | | | 15,285 | | | 16,474 |
Operating lease liabilities — non-current | | | 901 | | | 1,017 |
Deferred income taxes — non-current | | | 8 | | | 8 |
Total liabilities | | | $16,194 | | | $17,499 |
Commitments and contingencies (Note 8) | | | | | ||
Equity | | | | | ||
3M net investment | | | $233,561 | | | $228,921 |
Accumulated other comprehensive income (loss) | | | (43,638) | | | (43,904) |
Total equity | | | $189,923 | | | $185,017 |
Total liabilities and equity | | | $206,117 | | | $202,516 |
| | Three months ended March 31, | ||||
(In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Cash Flows from Operating Activities | | | | | ||
Net income | | | $21,296 | | | $21,843 |
Adjustments to reconcile net income to net cash provided by operating activities | | | | | ||
Depreciation and amortization | | | 1,699 | | | 1,404 |
Stock-based compensation expense | | | 763 | | | 623 |
Deferred income taxes | | | — | | | — |
Changes in operating assets and liabilities | | | | | ||
Accounts receivable | | | (2,809) | | | 1,358 |
Inventories | | | (1,083) | | | (6,702) |
Accounts payable | | | 1,784 | | | 2,892 |
Accrued payroll | | | (2,326) | | | (113) |
Other — net | | | (350) | | | (821) |
Net cash provided by (used in) operating activities | | | $18,974 | | | $20,484 |
| | | | |||
Cash Flows from Investing Activities | | | | | ||
Purchases of property, plant and equipment | | | (1,522) | | | (1,941) |
Net cash provided by (used in) investing activities | | | $(1,522) | | | $(1,941) |
| | | | |||
Cash Flows from Financing Activities | | | | | ||
Net transfers to 3M | | | (17,419) | | | (18,475) |
Other — net | | | (33) | | | (68) |
Net cash provided by (used in) financing activities | | | $(17,452) | | | $(18,543) |
| | | | |||
Net increase (decrease) in cash and cash equivalents | | | — | | | — |
(In thousands of U.S. dollars) | | | 3M Net Investment | | | Accumulated Other Comprehensive Income (Loss) | | | Total Equity |
Balance at December 31, 2020 | | | $218,884 | | | $(38,872) | | | $180,012 |
Net income | | | 21,843 | | | — | | | 21,843 |
Other comprehensive income (loss), net of tax | | | — | | | (2,667) | | | (2,667) |
Stock-based compensation | | | 623 | | | — | | | 623 |
Net transfers to 3M | | | (18,475) | | | — | | | (18,475) |
Balance at March 31, 2021 | | | $222,875 | | | $(41,539) | | | $181,336 |
Balance at December 31, 2021 | | | $228,921 | | | $(43,904) | | | $185,017 |
Net income | | | 21,296 | | | — | | | 21,296 |
Other comprehensive income (loss), net of tax | | | — | | | 266 | | | 266 |
Stock-based compensation | | | 763 | | | — | | | 763 |
Net transfers to 3M | | | (17,419) | | | — | | | (17,419) |
Balance at March 31, 2022 | | | $233,561 | | | $(43,638) | | | $189,923 |
| | Three months ended March 31, | ||||
Net Sales (In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Indicator Testing | | | $ 49,021 | | | $46,125 |
Hygiene Monitoring | | | 14,415 | | | 14,404 |
Sample Handling | | | 14,278 | | | 13,778 |
Pathogen Detection | | | 12,167 | | | 9,382 |
Allergen Testing | | | 1,740 | | | 1,828 |
Total Food Safety | | | $91,621 | | | $85,517 |
| | Three months ended March 31, | ||||
Net Sales (In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Americas | | | $51,533 | | | $48,241 |
Asia Pacific | | | 28,015 | | | 24,888 |
Europe, Middle East and Africa | | | 12,073 | | | 12,388 |
Total Food Safety | | | $91,621 | | | $85,517 |
(In thousands of U.S. dollars) | | | March 31, 2022 | | | December 31, 2021 |
Property, plant and equipment - at cost | | | | | ||
Buildings and leasehold improvements | | | $4,976 | | | $5,108 |
Machinery and equipment | | | 42,357 | | | 42,572 |
Construction in progress | | | 4,057 | | | 3,515 |
Other fixed assets | | | 3,021 | | | 3,399 |
Gross property, plant and equipment | | | 54,411 | | | 54,594 |
Accumulated depreciation | | | (31,532) | | | (31,032) |
Property, plant and equipment – net | | | $22,879 | | | $23,562 |
(In thousands of U.S. dollars) | | | |
Balance at December 31, 2021 | | | $81,046 |
Translation impact | | | 88 |
Balance at March 31, 2022 | | | $81,134 |
(In thousands of U.S. dollars) | | | March 31, 2022 | | | December 31, 2021 |
Customer related intangible assets | | | $3,070 | | | $3,070 |
Other technology-based intangible assets | | | 2,373 | | | 2,373 |
Other amortizable intangible assets | | | 538 | | | 538 |
Total gross carrying amount | | | $5,981 | | | $5,981 |
| | | | |||
Accumulated amortization — customer related | | | $(1,407) | | | $(1,330) |
Accumulated amortization — other technology-based | | | (989) | | | (935) |
Accumulated amortization — other | | | (493) | | | (466) |
Total accumulated amortization | | | (2,889) | | | $(2,731) |
Total intangible assets — net | | | $3,092 | | | $3,250 |
(In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Amortization expense | | | $158 | | | $158 |
(In thousands of U.S. dollars) | | | Remainder of 2022 | | | 2023 | | | 2024 | | | 2025 | | | 2026 | | | After 2026 |
Amortization expense | | | $436 | | | $523 | | | $523 | | | $523 | | | $523 | | | $564 |
| | Three Months ended March 31, | ||||
(In thousands of U.S. dollars) | | | 2022 | | | 2021 |
Cost of sales | | | $229 | | | $342 |
Selling, general and administrative expenses | | | 9,847 | | | 9,683 |
Research, development and related expenses | | | 1,966 | | | 1,985 |
Total | | | $12,042 | | | $12,010 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Net sales | | | $368,388 | | | $336,764 | | | $337,088 |
Operating expenses | | | | | | | |||
Cost of sales | | | 143,348 | | | 127,027 | | | 121,302 |
Selling, general and administrative expenses | | | 82,403 | | | 71,698 | | | 78,776 |
Research, development and related expenses | | | 25,185 | | | 20,830 | | | 20,727 |
Total operating expenses | | | 250,936 | | | 219,555 | | | 220,805 |
Income before income taxes | | | 117,452 | | | 117,209 | | | 116,283 |
Provision for income taxes | | | 23,720 | | | 25,237 | | | 24,505 |
Net income | | | $93,732 | | | $91,972 | | | $91,778 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Net income | | | $93,732 | | | $91,972 | | | $91,778 |
Other comprehensive income (loss), net of tax: | | | | | | | |||
Cumulative translation adjustment | | | (5,032) | | | 1,932 | | | (204) |
Total other comprehensive income (loss), net of tax | | | (5,032) | | | 1,932 | | | (204) |
Comprehensive income (loss) | | | $88,700 | | | $93,904 | | | $91,574 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Assets | | | | | ||
Current assets | | | | | ||
Cash | | | $— | | | $— |
Accounts receivable — net of allowances of $882 and $919 | | | 47,781 | | | 48,284 |
Inventories | | | | | ||
Finished goods | | | 21,632 | | | 18,565 |
Work in process | | | 5,614 | | | 3,707 |
Raw materials and supplies | | | 7,876 | | | 5,868 |
Total inventories | | | 35,122 | | | 28,140 |
Other current assets | | | 5,227 | | | 5,757 |
Total current assets | | | 88,130 | | | 82,181 |
Property, plant and equipment | | | 54,594 | | | 51,337 |
Less: Accumulated depreciation | | | (31,032) | | | (28,351) |
Property, plant and equipment — net | | | 23,562 | | | 22,986 |
Operating lease right of use assets | | | 1,403 | | | 2,174 |
Goodwill | | | 81,046 | | | 81,631 |
Intangible assets — net | | | 3,250 | | | 3,880 |
Deferred tax assets — non-current | | | 3,836 | | | 2,107 |
Other assets | | | 1,289 | | | 894 |
Total assets | | | $202,516 | | | $195,853 |
Liabilities | | | | | ||
Current liabilities | | | | | ||
Accounts payable | | | $8,497 | | | $7,718 |
Accrued payroll | | | 3,641 | | | 1,644 |
Operating lease liabilities — current | | | 357 | | | 494 |
Other current liabilities | | | 3,979 | | | 3,270 |
Total current liabilities | | | 16,474 | | | 13,126 |
Operating lease liabilities — non-current | | | 1,017 | | | 1,481 |
Deferred income taxes — non-current | | | 8 | | | 1,234 |
Total liabilities | | | $17,499 | | | $15,841 |
Commitments and contingencies (Note 10) | | | | | ||
Equity | | | | | ||
3M net investment | | | $228,921 | | | $218,884 |
Accumulated other comprehensive income (loss) | | | (43,904) | | | (38,872) |
Total equity | | | $185,017 | | | $180,012 |
Total liabilities and equity | | | $202,516 | | | $195,853 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Cash Flows from Operating Activities | | | | | | | |||
Net income | | | $93,732 | | | $91,972 | | | $91,778 |
Adjustments to reconcile net income to net cash provided by operating activities | | | | | | | |||
Depreciation and amortization | | | 4,639 | | | 4,537 | | | 4,213 |
Stock-based compensation expense | | | 1,183 | | | 1,222 | | | 1,286 |
Deferred income taxes | | | (3,086) | | | 573 | | | 861 |
Changes in operating assets and liabilities | | | | | | | |||
Accounts receivable | | | (1,742) | | | 4,739 | | | (821) |
Inventories | | | (8,329) | | | (884) | | | 2,561 |
Accounts payable | | | 469 | | | (150) | | | 559 |
Accrued payroll | | | 2,049 | | | (386) | | | 63 |
Other — net | | | 865 | | | (1,206) | | | (456) |
Net cash provided by (used in) operating activities | | | $89,780 | | | $100,417 | | | $100,044 |
| | | | | | ||||
Cash Flows from Investing Activities | | | | | | | |||
Purchases of property, plant and equipment (PP&E) | | | (5,088) | | | (4,359) | | | (4,125) |
Net cash provided by (used in) investing activities | | | $(5,088) | | | $(4,359) | | | $(4,125) |
| | | | | | ||||
Cash Flows from Financing Activities | | | | | | | |||
Net transfers to 3M | | | (84,878) | | | (95,989) | | | (95,685) |
Other — net | | | 186 | | | (69) | | | (234) |
Net cash provided by (used in) financing activities | | | $(84,692) | | | $(96,058) | | | $(95,919) |
| | | | | | ||||
Net increase (decrease) in cash and cash equivalents | | | — | | | — | | | — |
(In thousands of U.S. dollars) | | | 3M Net Investment | | | Accumulated Other Comprehensive Income (Loss) | | | Total Equity |
Balance at January 1, 2019 | | | $224,300 | | | $(40,600) | | | $183,700 |
Net income | | | 91,778 | | | — | | | 91,778 |
Other comprehensive income (loss), net of tax | | | — | | | (204) | | | (204) |
Stock-based compensation | | | 1,286 | | | — | | | 1,286 |
Net transfers to 3M | | | (95,685) | | | — | | | (95,685) |
Balance at December 31, 2019 | | | $221,679 | | | $(40,804) | | | $180,875 |
Net income | | | 91,972 | | | — | | | 91,972 |
Other comprehensive income (loss), net of tax | | | — | | | 1,932 | | | 1,932 |
Stock-based compensation | | | 1,222 | | | — | | | 1,222 |
Net transfers to 3M | | | (95,989) | | | — | | | (95,989) |
Balance at December 31, 2020 | | | $218,884 | | | $(38,872) | | | $180,012 |
Net income | | | 93,732 | | | — | | | 93,732 |
Other comprehensive income (loss), net of tax | | | — | | | (5,032) | | | (5,032) |
Stock-based compensation | | | 1,183 | | | — | | | 1,183 |
Net transfers to 3M | | | (84,878) | | | — | | | (84,878) |
Balance at December 31, 2021 | | | $228,921 | | | $(43,904) | | | $185,017 |
| | Year ended December 31, | |||||||
Net Sales (In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Indicator Testing | | | $199,677 | | | $182,219 | | | $188,676 |
Hygiene Monitoring | | | 61,617 | | | 58,195 | | | 56,265 |
Sample Handling | | | 57,089 | | | 52,981 | | | 52,045 |
Pathogen Detection | | | 42,574 | | | 36,769 | | | 34,397 |
Allergen Testing | | | 7,431 | | | 6,600 | | | 5,705 |
Total Food Safety | | | $368,388 | | | $336,764 | | | $337,088 |
| | Year ended December 31, | |||||||
Net Sales (In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Americas | | | $206,682 | | | $189,934 | | | $188,992 |
Asia Pacific | | | 110,058 | | | 99,082 | | | 101,673 |
Europe, Middle East and Africa | | | 51,648 | | | 47,748 | | | 46,423 |
Total Food Safety | | | $368,388 | | | $336,764 | | | $337,088 |
(In thousands of U.S. dollars) | | | |
Balance at December 31, 2019 | | | $80,659 |
Translation impact | | | 972 |
Balance at December 31, 2020 | | | $81,631 |
Translation impact | | | (585) |
Balance at December 31, 2021 | | | $81,046 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Customer related intangible assets | | | $3,070 | | | $3,070 |
Other technology-based intangible assets | | | 2,373 | | | 2,373 |
Other amortizable intangible assets | | | 538 | | | 538 |
Total gross carrying amount | | | $5,981 | | | $5,981 |
| | | | |||
Accumulated amortization — customer related | | | (1,330) | | | (1,023) |
Accumulated amortization — other technology-based | | | (935) | | | (719) |
Accumulated amortization — other | | | (466) | | | (359) |
Total accumulated amortization | | | $(2,731) | | | $(2,101) |
Total intangible assets — net | | | $3,250 | | | $3,880 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Amortization expense | | | $630 | | | $630 | | | $630 |
(In thousands of U.S. dollars) | | | 2022 | | | 2023 | | | 2024 | | | 2025 | | | 2026 | | | After 2026 |
Amortization expense | | | $594 | | | $523 | | | $523 | | | $523 | | | $523 | | | $564 |
| | Year ended December 31, | |||||||
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Cost of sales | | | $1,502 | | | $3,512 | | | $4,053 |
Selling, general and administrative expenses | | | 38,607 | | | 39,750 | | | 40,183 |
Research, development and related expenses | | | 7,449 | | | 5,810 | | | 6,215 |
Total | | | $47,558 | | | $49,072 | | | $50,451 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Property, plant and equipment - at cost | | | | | ||
Buildings and leasehold improvements | | | $5,108 | | | $5,205 |
Machinery and equipment | | | 42,572 | | | 40,640 |
Construction in progress | | | 3,515 | | | 2,552 |
Other fixed assets | | | 3,399 | | | 2,940 |
Gross property, plant and equipment | | | 54,594 | | | 51,337 |
Accumulated depreciation | | | (31,032) | | | (28,351) |
Property, plant and equipment – net | | | $23,562 | | | $22,986 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Depreciation expense | | | $4,009 | | | $3,907 | | | $3,583 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Americas | | | $12,569 | | | $12,288 |
Asia Pacific | | | 1,123 | | | 964 |
Europe, Middle East and Africa | | | 12,562 | | | 12,802 |
Total Company | | | $26,254 | | | $26,054 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
United States | | | $75,892 | | | $91,202 | | | $90,189 |
International | | | 41,560 | | | 26,007 | | | 26,094 |
Total | | | $117,452 | | | $117,209 | | | $116,283 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Current tax expense | | | | | | | |||
Federal | | | $15,253 | | | $16,170 | | | $13,759 |
State | | | 3,331 | | | 3,539 | | | 4,109 |
International | | | 8,222 | | | 4,955 | | | 5,776 |
Deferred tax expense | | | | | | | |||
Federal | | | (2,713) | | | 603 | | | 782 |
State | | | (326) | | | 73 | | | 110 |
International | | | (47) | | | (103) | | | (31) |
Total | | | $23,720 | | | $25,237 | | | $24,505 |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Deferred tax assets: | | | | | ||
Accrued expenses | | | 814 | | | 623 |
Stock-based compensation | | | 896 | | | 384 |
Net operating losses | | | 4,014 | | | 2,192 |
Foreign tax credits | | | 722 | | | 653 |
Inventory reserves | | | 304 | | | 249 |
Lease liability | | | 321 | | | 348 |
Prepaid royalty | | | 2,376 | | | — |
Other deferred tax assets | | | 1,464 | | | 1,455 |
Gross deferred tax assets | | | 10,911 | | | 5,904 |
Valuation allowance | | | (4,716) | | | (2,856) |
Total deferred tax assets | | | $6,195 | | | $3,048 |
| | | |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 |
Deferred tax liabilities: | | | | | ||
Property, plant and equipment | | | (2,039) | | | (1,517) |
Currency translation | | | — | | | (286) |
Right of use asset | | | (328) | | | (372) |
Total deferred tax assets | | | (2,367) | | | (2,175) |
| | | | |||
Net deferred tax assets | | | $3,828 | | | $873 |
| | 2021 | | | 2020 | | | 2019 | |
U.S. Statutory income tax rate | | | 21.0% | | | 21.0% | | | 21.0% |
State income taxes - net of federal benefit | | | 2.0 | | | 2.4 | | | 2.9 |
Foreign rate differential | | | (2.8) | | | (2.4) | | | (1.0) |
US international income inclusions | | | 2.9 | | | 2.2 | | | 0.8 |
Foreign derived intangible income (FDII) | | | (3.7) | | | (3.1) | | | (3.0) |
U.S. research and development credit | | | (0.5) | | | (0.8) | | | (1.1) |
Liabilities for uncertain tax positions | | | 1.1 | | | 0.6 | | | 0.5 |
Changes in valuation allowances | | | 1.4 | | | 1.1 | | | 1.3 |
All other - net | | | (1.2) | | | 0.5 | | | (0.3) |
Effective income tax rate | | | 20.2% | | | 21.5% | | | 21.1% |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Gross UTB Balance at January 1 | | | — | | | — | | | — |
| | | | | | ||||
Additions based on tax positions related to the current year | | | 1,248 | | | 680 | | | 636 |
Additions for tax positions of prior years | | | — | | | — | | | — |
Additions related to recent acquisitions | | | — | | | — | | | — |
Reductions for tax positions of prior years | | | — | | | — | | | — |
(In thousands of U.S. dollars) | | | 2021 | | | 2020 | | | 2019 |
Settlements | | | — | | | — | | | — |
Reductions due to lapse of applicable statute of limitations | | | — | | | — | | | — |
Reductions for amounts recorded to 3M net investment | | | (1,248) | | | (680) | | | (636) |
| | | | | | ||||
Gross UTB Balance at December 31 | | | — | | | — | | | — |
UTB that would impact the effective tax rate at December 31 | | | — | | | — | | | — |
| | | | | | Page | |||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |
| | | | | | Page | |||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |
| | | | | | Page | |||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |
EXHIBITS | | | |
Exhibit A | | | Separation and Distribution Agreement |
Exhibit B | | | Form of Tax Matters Agreement |
Exhibit C | | | Employee Matters Agreement |
Exhibit D | | | Form of Transition Services Agreement |
Exhibit E | | | Form of Transition Contract Manufacturing Agreement |
Exhibit F | | | Form of Transition Distribution Services Agreement |
Exhibit G | | | Form of Parent Charter Amendment |
Exhibit H | | | Form of Parent Bylaw Amendment |
Exhibit I | | | Asset Purchase Agreement |
Exhibit J | | | Form of Transitional Trademark License Agreement |
Exhibit K | | | Form of Clean-Trace™ Agreement |
Exhibit L | | | Form of Intellectual Property Cross-License Agreement |
Term | | | Section |
Additional Parent SEC Documents | | | Section 6.8 |
Additional Requirements | | | Section 3.1(c)(i) |
Agent Agreement | | | Section 3.2(a) |
Alternative Financing | | | Section 7.6(b) |
Alternative Notice | | | Section 7.9(c) |
Applicable Percentage | | | Section 3.1(c)(i) |
Binding Offer Jurisdiction | | | Section 7.23(b) |
Certificate of Merger | | | Section 2.3 |
Chosen Courts | | | Section 10.2 |
Clean-Up Spin-Off | | | Recitals |
Closing | | | Section 2.2 |
Closing Date | | | Section 2.2 |
COBRA | | | Section 5.18(i) |
Company | | | Preamble |
Company Board | | | Recitals |
Company Designated Directors | | | Section 2.5(a) |
Competing Proposal | | | Section 7.9(g)(i) |
Debt Commitment Letter | | | Section 7.6(a) |
Distribution | | | Recitals |
Distribution Documents | | | Section 5.23 |
Distribution Tax Opinions | | | Section 7.3(a) |
Effective Time | | | Section 2.3 |
Exchange Agent | | | Section 3.2(b) |
Exchange Fund | | | Section 3.2(a) |
Exchange Offer | | | Recitals |
Term | | | Section |
Financing | | | Section 7.6(a) |
Financing Agreements | | | Section 7.6(d) |
Interim Period | | | Section 7.1 |
IRS Submission | | | Section 7.3(h) |
Maximum Impacted Historical Revenue | | | Section 7.5(c) |
Merger | | | Section 2.1 |
Merger Consideration | | | Section 3.1(a)(i) |
Merger Sub | | | Preamble |
Merger Sub Common Stock | | | Section 3.1(a)(v) |
Merger Sub Shareholder Approval | | | Section 7.25 |
Negotiation Period | | | Section 7.9(c) |
One-Step Spin-Off | | | Recitals |
Outside Date | | | Section 9.1(b) |
Parent | | | Preamble |
Parent Adverse Recommendation Change | | | Section 7.9(a) |
Parent Audit Committee | | | Section 6.8(b) |
Parent Board | | | Recitals |
Parent Board Recommendation | | | Recitals |
Parent Bylaw Amendment | | | Section 2.6 |
Parent Charter Amendment | | | Section 2.6 |
Parent Foreign Benefit Plan | | | Section 6.17(j) |
Parent Material Contracts | | | Section 6.14(a) |
Parent Preferred Stock | | | Section 6.3(a) |
Parent Share Issuance | | | Recitals |
Parent Shareholders Meeting | | | Section 7.4(d)(i) |
Parent Voting Debt | | | Section 6.3(b) |
Parties | | | Preamble |
Party | | | Preamble |
PBGC | | | Section 5.18(e) |
Permanent Financing | | | Section 7.6(g) |
Remedies Exception | | | Section 4.2 |
Replacement Company Designee | | | Section 2.5(a) |
Schedule TO | | | Section 7.4(a) |
Section 409A | | | Section 5.18(c) |
Section 7.23(b) Works Councils | | | Section 7.23(b) |
Separation | | | Recitals |
SpinCo | | | Preamble |
SpinCo Board | | | Recitals |
SpinCo Foreign Benefit Plan | | | Section 5.18(a) |
SpinCo Material Contracts | | | Section 5.15(a) |
SpinCo Shareholder Approval | | | Section 5.24 |
SpinCo Voting Debt | | | Section 5.3(b) |
Superior Proposal | | | Section 7.9(g)(ii) |
Surviving Corporation | | | Section 2.1 |
Tax-Free Status | | | Section 7.3(a) |
Termination Fee | | | Section 9.3(b) |
Threshold Percentage | | | Section 3.1(c)(i) |
Transaction Litigation | | | Section 7.13 |
| | if to the Company or SpinCo, to: | |||||||
| | | | | | ||||
| | | | 3M Company | |||||
| | | | 3M Health Care Business Group | |||||
| | | | 3M Center, Building 220-14E-13 | |||||
| | | | St. Paul, MN 55144-1000 | |||||
| | | | Attention: | | | Mojdeh Poul, Group President | ||
| | | | Email: | | | mpoul@mmm.com | ||
| | | | | | ||||
| | with a copy (which shall not constitute notice) to: | |||||||
| | | | | | ||||
| | | | 3M Company | |||||
| | | | 3M Office of General Counsel | |||||
| | | | 3M Center, Building 220-9E-02 | |||||
| | | | St. Paul, MN 55144-1000 | |||||
| | | | Attention: | | | Michael Dai, Assistant Secretary | ||
| | | | Email: | | | dealnotices@mmm.com | ||
| | | | | | ||||
| | | | and | | | |||
| | | | | | ||||
| | | | Wachtell, Lipton, Rosen & Katz | |||||
| | | | 51 West 52nd Street | |||||
| | | | New York, NY 10019 | |||||
| | | | Telephone: (212) 403-1000 | |||||
| | | | Attention: | | | Steven A. Rosenblum; Jenna E. Levine | ||
| | | | E-mail: | | | SARosenblum@wlrk.com; JELevine@wlrk.com | ||
| | | | | | ||||
| | if to Parent, to: | |||||||
| | | | | | ||||
| | | | Neogen Corporation | |||||
| | | | 620 Lesher Place | |||||
| | | | Lansing, MI 48912 | |||||
| | | | Attention: | | | Amy Rocklin, Vice President and General Counsel | ||
| | | | Email: | | | ARocklin@neogen.com | ||
| | | | | | ||||
| | with a copy (which shall not constitute notice) to: | |||||||
| | | | | | ||||
| | | | Weil, Gotshal & Manges LLP | |||||
| | | | 767 Fifth Avenue | |||||
| | | | New York, NY 10153 | |||||
| | | | Telephone: (212) 310-8000 | |||||
| | | | Attention: | | | Michael J. Aiello; Eoghan P. Keenan | ||
| | | | E-mail: | | | michael.aiello@weil.com; eoghan.keenan@weil.com |
| | 3M COMPANY | ||||
| | | | |||
| | By: | | | /s/ Mojdeh Poul | |
| | | | Name: Mojdeh Poul | ||
| | | | Title: Group President, 3M Health Care | ||
| | | | |||
| | GARDEN SPINCO CORPORATION | ||||
| | | | |||
| | By: | | | /s/ Jerry Will | |
| | | | Name: Jerry Will | ||
| | | | Title: Vice President | ||
| | | | |||
| | NEOGEN CORPORATION | ||||
| | | | |||
| | By: | | | /s/ John Adent | |
| | | | Name: John Adent | ||
| | | | Title: President and CEO | ||
| | | | |||
| | NOVA RMT SUB, INC. | ||||
| | | | |||
| | By: | | | /s/ John Adent | |
| | | | Name: John Adent | ||
| | | | Title: President |
| | | | | | Page | |||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |
| | | | | | Page | |||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | ||||||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | | ||||
| | | | | |
Schedule 1.1 | | | Overhead and Shared Services |
Schedule 1.2 | | | Products |
Schedule 1.3 | | | Retained Businesses |
Schedule 2.1(a) | | | Separation Step Plan |
Schedule 2.2(a) | | | SpinCo Assets |
Schedule 2.2(b) | | | Excluded Assets |
Schedule 2.6(b) | | | Intercompany Accounts |
Schedule 2.14 | | | Real Property Matters |
Schedule 3.2(f) | | | IRS Rulings |
Schedule 4.1 | | | Delivery of SpinCo Electronic Business Records |
Schedule 6.9(b) | | | Management of Company Controlled Actions |
Exhibit A | | | Net Working Capital |
Exhibit B | | | Form of Real Estate License Agreement |
Definition | | | Location |
Agreed Procedures | | | Section 4.1 |
Agreement | | | Preamble |
Available Cash | | | Section 3.1(b)(i) |
Chosen Courts | | | Section 9.3 |
Clean-Up Spin-Off | | | Section 3.3(c) |
Company | | | Preamble |
Company Common Stock | | | Recitals |
Company Confidential Information | | | Section 7.2(b) |
Company Controlled Actions | | | Section 6.9(b) |
Company Counsel | | | Section 4.7(a) |
Company Indemnification Obligations | | | Section 6.2 |
Company Indemnified Parties | | | Section 6.1 |
Company Released Persons | | | Section 5.1(a) |
Corporate Policies | | | Section 7.3 |
Distribution | | | Recitals |
Estimated Net Working Capital | | | Section 2.7(b) |
Estimated Net Working Capital Adjustment | | | Section 2.7(a)(i) |
Exchange Offer | | | Recitals |
Excluded Assets | | | Section 2.2(b) |
Excluded Liabilities | | | Section 2.3(b) |
Existing Company Counsel | | | Section 4.7(a) |
Existing Company Outside Counsel | | | Section 4.7(e) |
Final Net Working Capital | | | Section 2.7(i) |
General SpinCo Business Information | | | Section 4.7(b) |
Indemnified Party | | | Section 6.4(a) |
Indemnifying Party | | | Section 6.4(a) |
Indemnity Payment | | | Section 6.4(a) |
Integration Data Disclosure Agreement | | | Section 4.3(d) |
Merger | | | Recitals |
Merger Agreement | | | Recitals |
Merger Sub | | | Recitals |
Minimum Cash Amount | | | Section 3.1(b)(i) |
Mixed Action | | | Section 6.9(d) |
Net Working Capital | | | Section 2.7(a)(ii) |
Notice of Disagreement | | | Section 2.7(d) |
Parent | | | Preamble |
Permits | | | Definition of Assets |
Post-Distribution SpinCo Transfer Documents | | | Section 2.4(a) |
Pre-Distribution Transfer Documents | | | Section 2.1(b) |
Definition | | | Location |
Preliminary Adjustment Statement | | | Section 2.7(c) |
Representatives | | | Section 7.2(a) |
Separate Action | | | Section 6.9(c) |
Separation Step Plan | | | Section 2.1(a) |
SpinCo | | | Preamble |
SpinCo Assets | | | Section 2.2(a) |
SpinCo Common Stock | | | Recitals |
SpinCo Confidential Information | | | Section 7.2(a) |
SpinCo Controlled Actions | | | Section 6.9(a) |
SpinCo Indemnification Obligations | | | Section 6.1 |
SpinCo Indemnified Parties | | | Section 6.2 |
SpinCo Liabilities | | | Section 2.3(a) |
SpinCo Payment | | | Section 3.1(b)(ii) |
SpinCo Released Persons | | | Section 5.1(b) |
Spin-Off | | | Recitals |
Target Net Working Capital | | | Section 2.7(a)(iii) |
Third-Party Claim | | | Section 6.5(a) |
| | If to the Company or, on or prior to the Distribution Date, to SpinCo, then to: | |||||||
| | | | | | ||||
| | | | 3M Company | |||||
| | | | 3M Health Care Business Group | |||||
| | | | 3M Center, Building 220-14E-13 | |||||
| | | | St. Paul, MN 55144-1000 | |||||
| | | | Attention: | | | Mojdeh Poul, Group President | ||
| | | | Email: | | | mpoul@mmm.com | ||
| | | | | | ||||
| | with a copy (which shall not constitute notice) to: | |||||||
| | | | | | ||||
| | | | 3M Company | |||||
| | | | 3M Office of General Counsel | |||||
| | | | 3M Center, Building 220-9E-02 | |||||
| | | | St. Paul, MN 55144-1000 | |||||
| | | | Attention: | | | Michael Dai, Assistant Secretary | ||
| | | | Email: | | | dealnotices@mmm.com | ||
| | | | | | ||||
| | and | |||||||
| | | | | | ||||
| | | | Wachtell, Lipton, Rosen & Katz | |||||
| | | | 51 West 52nd Street | |||||
| | | | New York, NY 10019 | |||||
| | | | Telephone: | | | (212) 403-1000 | ||
| | | | Attention: | | | Steven A. Rosenblum; Jenna E. Levine | ||
| | | | E-mail: | | | SARosenblum@wlrk.com; JELevine@wlrk.com | ||
| | | | | | ||||
| | If to Parent or, following the Distribution Date, to SpinCo, then to: | |||||||
| | | | | | ||||
| | | | Neogen Corporation | |||||
| | | | 620 Lesher Place | |||||
| | | | Lansing, MI 48912 | |||||
| | | | Attention: | | | Amy Rocklin, Vice President and General Counsel | ||
| | | | Email: | | | ARocklin@neogen.com | ||
| | | | | |
| | with a copy (which shall not constitute notice) to: | |||||||
| | | | | | ||||
| | | | Weil, Gotshal & Manges LLP | |||||
| | | | 767 Fifth Avenue | |||||
| | | | New York, NY 10153 | |||||
| | | | Telephone: | | | (212) 310-8000 | ||
| | | | Attention: | | | Michael J. Aiello; Eoghan P. Keenan | ||
| | | | E-mail: | | | michael.aiello@weil.com; eoghan.keenan@weil.com |
| | 3M COMPANY | |||||||
| | | | | | ||||
| | By: | | | /s/ Mojdeh Poul | ||||
| | | | Name: | | | Mojdeh Poul | ||
| | | | Title: | | | Group President, 3M Health Care | ||
| | | | | | ||||
| | GARDEN SPINCO CORPORATION | |||||||
| | | | | | ||||
| | By: | | | /s/ Jerry Will | ||||
| | | | Name: | | | Jerry Will | ||
| | | | Title: | | | Vice President | ||
| | | | | | ||||
| | NEOGEN CORPORATION | |||||||
| | | | | | ||||
| | By: | | | /s/ John Adent | ||||
| | | | Name: | | | John Adent | ||
| | | | Title: | | | President and CEO |
| | 3M COMPANY | ||||
| | | | |||
| | By: | | | /s/ Mojdeh Poul | |
| | Name: | | | Mojdeh Poul | |
| | Title: | | | Group President, 3M Healthcare | |
| | | | |||
| | NEOGEN CORPORATION | ||||
| | | | |||
| | By: | | | /s/ John Adent | |
| | Name: | | | John Adent | |
| | Title: | | | President and CEO |
| | ||
| | Centerview Partners LLC 31 West 52nd Street New York, NY 10019 December 13, 2021 |
31 WEST 52ND STREET, 22ND FLOOR, NEW YORK, NY 10019 | |||||||||||||||||||||||||||||||||
PHONE: (212) 380-2650 FAX: (212) 380-2651 WWW.CENTERVIEWPARTNERS.COM | |||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||
NEW YORK | | | • | | | LONDON | | | • | | | PARIS | | | • | | | SAN FRANCISCO | | | • | | | PALO ALTO | | | • | | | LOS ANGELES | |
| | Very truly yours, | |
| | ||
| | /s/ Centerview Partners LLC | |
| | CENTERVIEW PARTNERS LLC |
1290 Avenue of the Americas, 9th Floor New York, NY 10104 Shareholders, Banks and Brokers Call Toll Free: 888-607-6511 |
By First Class Mail: | | | By Facsimile Transmission: (FOR NOTICE OF GUARANTEED DELIVERY ONLY) | | | By Registered or Overnight Courier: |
Equiniti Trust Company Shareowner Services Voluntary Corporate Actions P.O. Box 64858 St. Paul, Minnesota 55164-0858 | | | Equiniti Trust Company Shareowner Services Voluntary Corporate Actions (866) 734-9952 (fax) | | | Equiniti Trust Company Shareowner Services Voluntary Corporate Actions 1110 Centre Pointe Curve, Suite 101 Mendota Heights, Minnesota 55120 |
Exhibit Number | | | Title |
2.1 | | | Agreement and Plan of Merger, dated as of December 13, 2021, by and among 3M Company, Garden SpinCo Corporation, Neogen Corporation and Nova RMT Sub, Inc. (attached as Annex A to the prospectus which forms part of this Registration Statement).(1) |
2.2 | | | Separation and Distribution Agreement, dated as of December 13, 2021, by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation (attached as Annex B to the prospectus which forms part of this Registration Statement).(1) |
2.3 | | | Asset Purchase Agreement, by and between 3M Company and Neogen Corporation, dated as of December 13, 2021 (attached as Annex C to the prospectus which forms part of this Registration Statement).(1) |
| | Restated Articles of Incorporation of Neogen Corporation, as amended on November 23, 2011 (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q filed by Neogen on December 30, 2011). | |
| | Certificate of Amendment to Articles of Incorporation of Neogen Corporation filed on October 11, 2010 (incorporated by reference to Exhibit 3.2 to the Annual Report on Form 10-K filed by Neogen on July 30, 2020). | |
| | Certificate of Amendment to Articles of Incorporation of Neogen Corporation filed on November 20, 2018 (incorporated by reference to Exhibit 3 to the Quarterly Report on Form 10-Q filed by Neogen on December 28, 2018). | |
| | Certificate of Amendment to Articles of Incorporation of Neogen Corporation filed on March 14, 2022 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Neogen on March 17, 2022). | |
| | By-Laws, as amended (incorporated by reference to Exhibit 3.2 to the Quarterly Report on Form 10-Q filed by Neogen on April 14, 2000). | |
| | Opinion of Honigman LLP as to the validity of shares of common stock to be issued by Neogen Corporation.* | |
| | ||
| | ||
| | Employee Matters Agreement, by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation, dated as of December 13, 2021 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Neogen on December 15, 2021).(1) | |
| | Form of Tax Matters Agreement, to be entered into by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation. | |
| | Form of Intellectual Property Cross-License Agreement, to be entered into by and between 3M Company and Garden SpinCo Corporation. | |
| | Form of Trademark Transitional License Agreement, to be entered into by and among 3M Company, 3M Innovative Properties Company, Neogen Corporation and Garden SpinCo Corporation.* | |
| | Form of Distribution Agreement, to be entered into by and between 3M Company and Garden SpinCo Corporation. | |
| | Form of Transition Services Agreement, to be entered into by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation. | |
| | Form of Transition Distribution Services Agreement, to be entered into by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation. |
Exhibit Number | | | Title |
| | Form of Transition Contract Manufacturing Agreement, to be entered into by and among 3M Company, Garden SpinCo Corporation and Neogen Corporation.* | |
| | Senior Secured Credit Agreement, dated as of June 30, 2022, among Garden SpinCo Corporation, the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as administrative agent.*(1) | |
| | Senior Notes Indenture for 8.625% Senior Notes due 2030, dated as of July 20, 2022, among Garden SpinCo Corporation, as issuer, the guarantors party thereto from time to time, and U.S. Bank Trust Company, National Association, as trustee.* | |
| | Consent of Wachtell, Lipton, Rosen & Katz (included in Exhibit 8.1). | |
| | Consent of Weil, Gotshal & Manges LLP (included in Exhibit 8.2). | |
| | Consent of PricewaterhouseCoopers LLP relating to the audited financial statements of the Food Safety Business of 3M Company.** | |
| | Consent of BDO USA, LLP relating to the audited financial statements of Neogen Corporation.** | |
| | Consent of PricewaterhouseCoopers LLP relating to the audited financial statements of 3M Company.** | |
| | Consent of | |
| | Power of Attorney (included on signature page).* | |
| | Consent of Centerview Partners LLC.** | |
| | Form of Letter of Transmittal. | |
| | Form of Exchange and Transmittal Information Booklet. | |
| | Form of Letter to Clients for Use by Banks, Brokers and Other Nominees. | |
| | Form of Letter to Brokers, Commercial Bankers, Trust Companies and Other Nominees. | |
| | Form of Notice of Guaranteed Delivery for shares of 3M common stock. | |
| | Form of Notice of Withdrawal of 3M common stock. | |
| | Form of Notice to Participants in the 3M Voluntary Investment Plan and Employee Stock Ownership Plan and the 3M Savings Plan** | |
| | Registration Fee Table.* |
* | Filed previously. |
** | Filed herewith. |
+ | To be filed by amendment |
(1) | Exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K and will be supplementally provided to the Securities and Exchange Commission upon request. |
(2) | Certain confidential information contained in this document, marked by [***], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed. |
(a) | The undersigned registrant hereby undertakes: |
(1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
(i) | To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. |
(2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
(4) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness; Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
(5) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: |
(i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
(iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(b) | The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(c) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in |
(d) | The undersigned registrant hereby undertakes as follows: That prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this registration statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933, the issuer undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
(e) | The registrant undertakes that every prospectus (i) that is filed pursuant to paragraph (1) immediately preceding, or (ii) that purports to meet the requirements of section 10(a)(3) of the Securities Act of 1933 and is used in connection with an offering of securities subject to Rule 415 of the Securities Act of 1933, will be filed as a part of an amendment to the registration statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(f) | The undersigned registrant hereby undertakes that: |
(1) | For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. |
(2) | For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(g) | The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. |
(h) | The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. |
| | Neogen Corporation | ||||
| | | | |||
| | By: | | | /s/ John E. Adent | |
| | | | Name: John E. Adent | ||
| | | | Title: President & Chief Executive Officer (Principal Executive Officer) |
Signature | | | Title | | | Date |
/s/ John E. Adent | | | President & Chief Executive Officer (Principal Executive Officer) | | ||
John E. Adent | | | ||||
| | | ||||
| | Vice President & Chief Financial Officer (Principal Financial & Accounting Officer) | | | ||
Steven J. Quinlan | | | ||||
| | | | |||
* | | | Director | | | |
James C. Borel | | | | | ||
| | | | |||
* | | | Director | | | |
William T. Boehm, Ph.D. | | | | | ||
| | | | |||
* | | | Director | | | |
Ronald D. Green, Ph.D | | | | | ||
| | | | |||
* | | | Director | | | |
Ralph A. Rodriguez | | | | | ||
| | | | |||
* | | | Director | | | |
James P. Tobin | | | | | ||
| | | | |||
* | | | Director | | | |
Darci L. Vetter | | | | | ||
| | | | |||
* | | | Director | | | |
Catherine E. Woteki, Ph.D. | | | | |
* | John E. Adent, by signing his name hereto, does hereby sign this Registration Statement on behalf of the directors of the registrant above whose names an asterisk appears, pursuant to a power of attorney duly exercised by such directors and filed with the SEC. |
By: | | | /s/ John E. Adent | | | |
| | John E. Adent | | | ||
| | Attorney-in-Fact | | |