Item 1.01. Entry into a Material Definitive Agreement.
As previously disclosed, on December 3, 2007, Oracle Healthcare Acquisition Corp., a Delaware corporation (“Oracle”), PTI Acquisition Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Oracle (“Merger Sub”), Precision Therapeutics, Inc., a Delaware corporation (“PTI”), and, for the limited purposes provided in Article X thereof, Joel P. Adams entered into an
Agreement and Plan of Merger, which was amended on January 24, 2008 (as so amended, the “Merger Agreement”), pursuant to which Oracle agreed to acquire PTI by means of a merger (the “Merger”) of Merger Sub with and into PTI,
with PTI being the surviving corporation of the Merger as a wholly owned subsidiary of Oracle.
On February 25, 2008, Oracle, Merger Sub, PTI and Joel
P. Adams, as representative of PTI stockholders, entered into an amendment to the Merger Agreement (the “Second Amendment”). Pursuant to the Second Amendment, the number of shares of Oracle common stock used in the calculation of the
exchange ratio pursuant to which shares of PTI common stock would be exchanged for shares of Oracle common stock (identified as the “Share Multiplication Factor” in the “Example of Calculation of Exchange Ratio and Number of Oracle
Shares to be Issued/Reserved for Issuance” included in the proxy statement/prospectus, dated February 11, 2008 (“Proxy Statement/Prospectus”), that has been filed with the U. S. Securities and Exchange Commission (the
“SEC”) and mailed to the Oracle stockholders) will be reduced from 22,500,000 to 19,125,000 shares, resulting in a reduction in the merger consideration to be issued, or reserved for issuance, at the closing of the Merger to PTI
stockholders and holders of options and warrants to purchase PTI stock by approximately 15%. Pursuant to the Second Amendment, the number of shares of Oracle common stock that would be placed into escrow to satisfy any indemnification claims that
may be asserted by Oracle has been reduced by 15% from 2,250,000 to 1,912,500 shares.
The Proxy Statement/Prospectus also described additional contingent
consideration payable to the former PTI securityholders in the form of “Top-Up Consideration” and “Milestone Consideration.” As a result of the Second Amendment, the “Top-Up Consideration” has been eliminated. The
provisions in the Merger Agreement regarding the “Milestone Consideration” have not been changed. The Second Amendment also provides that, as a condition to the closing of the Merger, a redemption agreement shall be in full force and
effect pursuant to which each purchaser of Oracle’s common stock issued prior to its initial public offering agrees to have 50% of the shares of Oracle common stock purchased by such holder prior to the initial public offering purchased and
redeemed by Oracle at a purchase price of $0.0083 per share concurrently with the closing of the merger, thereby reducing the number of such shares outstanding from 3,750,000 shares to 1,875,000 shares.
This Item 1.01 contains a brief summary of the Second Amendment and the transactions contemplated thereby. This summary does not purport to be complete and is qualified
in its entirety by reference to the full text of the Second Amendment, which is attached hereto as Exhibit 2.1 and is incorporated in this Item 1.01 by reference.