The Ademi Firm is investigating Lava (Nasdaq: LVTX) for possible breaches of fiduciary duty and other violations of law in its transaction with XOMA Royalty.
Under the Amendment, LAVA shareholders will receive (i) an initial cash amount per share of $1.04 as compared to the range between $1.16 and $1.24 that was originally agreed, plus (ii) a non-transferable contingent value right per share representing the right to receive certain cash payments under certain conditions. In addition, LAVA and XOMA Royalty have agreed to amend LAVA’s minimum net-cash closing condition to be $24.5 million, compared to the previous minimum net-cash closing condition of $31.5 million.
Lava insiders will continue to receive substantial benefits as part of change of control arrangements.
The transaction agreement unreasonably limits competing transactions for Lava by imposing a significant penalty if Lava accepts a competing bid. We are investigating the conduct of the Lava board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.
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