Item 1A. Risk Factors
Item 1A. Risk Factors.
As of September 30, 2025, there have been no material changes to the risk factors described in Item 1A, “Risk Factors” included in our 2024 Form 10-K other than the risks stated below.
Risks Related to the Merger
The Merger is subject to conditions, some or all of which may not be satisfied or completed on a timely basis, if at all. Failure to complete the Merger could have material adverse effects on the Company.
The consummation of the Merger is subject to customary closing conditions, including (i) the approval of the issuance of Company Common Stock pursuant to the Merger Agreement by the affirmative vote of the holders of a majority of all outstanding shares of Company Common Stock entitled to vote thereon, (ii) the adoption of the Merger Agreement by the affirmative vote of the holders of a majority of all outstanding shares of Veeco Common Stock entitled to vote thereon, (iii) the absence of any law or order promulgated, entered, enforced, enacted or issued by any governmental entity that prohibits, restrains or makes illegal the consummation of the Merger, (iv) the shares of Company Common Stock to be issued in the Merger (the “ Company Stock Issuance ”) being approved for listing on the Nasdaq Global Select Market, (v) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the approval of the Merger by the State Administration for Market Regulation in the People’s Republic of China and receipt of, or expiration of applicable waiting periods in connection with, other government approvals, (vi) the Form S-4 Registration Statement of the Company, which will contain the joint proxy statement/prospectus of the parties in connection with the Merger, having become effective under the Securities Exchange Act of 1934 and not being the subject of any stop order or pending proceeding by the U.S. Securities and Exchange Commission (the “ SEC ”), (vii) subject to certain materiality exceptions, the accuracy of certain representations and warranties of each of the Company and Veeco contained in the Merger Agreement, (viii) the compliance by each party with the covenants contained in the Merger Agreement, and (ix) the absence of a material adverse effect with respect to each of the Company and Veeco. The Merger is expected to close in the second half of 2026, subject to the satisfaction or waiving of the foregoing closing conditions.
If the Merger is not completed, the Company’s ongoing business may be materially adversely affected and, without realizing any of the benefits of having completed the Merger, the Company will be subject to a number of risks, including the following:
● the market price of the Company’s common stock could decline;
● the Company could owe substantial termination fees to Veeco under certain circumstances;
● if the Merger Agreement is terminated and the Veeco board or the Company’s board seeks another business combination, Veeco shareholders and the Company’s shareholders cannot be certain that Veeco or the Company will be able to find a party willing to enter into a transaction on terms equivalent to or more attractive than the terms that the other party has agreed to in the Merger Agreement;
● time, resources, and costs committed by the Company’s management team to matters relating to the Merger could otherwise have been devoted to pursuing other beneficial opportunities;
● the Company may experience negative reactions from the financial markets or from its customers, suppliers, employees, or other business partners; and
● the Company will be required to pay its respective costs relating to the Merger, such as legal, accounting, financial advisory, and printing fees, whether or not the Merger are completed.
In addition, if the Merger is not completed, the Company could be subject to litigation related to any failure to complete the Merger or related to any enforcement proceeding commenced against the Company to perform its obligations
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under the Merger Agreement, and whether or not any such litigation has any merit, the cost of defending such litigation may be significant. The materialization of any of these risks could adversely impact the Company’s ongoing business.
Similarly, delays in the completion of the Merger could, among other things, result in additional transaction costs, loss of revenue, or other negative effects associated with uncertainty about completion of the Merger.
The Merger is subject to the receipt of the requisite regulatory approvals, which requisite regulatory approvals may never be obtained, therefore preventing completion of the Merger. In addition, in granting such approvals, regulatory authorities may impose conditions that could have a significant adverse effect on the Company or the combined company and the expected benefits of the Merger, therefore preventing completion of the Merger.
Before the Merger may be completed, the requisite regulatory approvals must have been obtained. The terms and conditions of the approvals that are granted may impose requirements, concessions, limitations, or costs or place restrictions on the conduct of the combined company’s business.
Subject to the terms and conditions of the Merger Agreement, Veeco and the Company have each agreed to use their reasonable best efforts to consummate the Merger, including to obtain the regulatory approvals necessary to complete the Merger; provided that neither party is required to accept a remedy that, considered individually or in the aggregate, would have an adverse impact that is material to (a) the reasonably anticipated benefits to the Company or Veeco of the Merger, (b) the business of the Company and its subsidiaries, taken as a whole or (c) the business of Veeco and its subsidiaries, taken as a whole; provided further, that neither party is required to license any of its intellectual property to obtain regulatory approvals.
These requirements, concessions, and conditions may therefore reduce the anticipated benefits of the Merger, including synergies, which could also have a significant adverse effect on the combined company’s business and cash flows and results of operations, and neither Veeco nor the Company can predict what, if any, requirements, concessions, and conditions may be required by regulatory or governmental authorities whose approvals are required. The requisite regulatory approvals may not be obtained at all, may not be obtained in a timely fashion, and may contain conditions on the completion of the Merger.
Uncertainties associated with the Merger may cause a loss of management personnel and other key employees, and the Company may have difficulty attracting and motivating management personnel and other key employees.
The Company is dependent on the experience and industry knowledge of its management personnel and other key employees to execute its business plans. The combined company’s success after the completion of the Merger will depend in part upon the ability of the Company to attract and retain key management personnel and other key employees. Prior to completion of the Merger, current and prospective employees of the Company may experience uncertainty about their roles within the combined company following the completion of the Merger, which may have an adverse effect on the ability of the Company to attract or retain management personnel and other key employees.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.