Attached files
file | filename |
---|---|
EX-2.1 - EX-2.1 - Virtual Radiologic CORP | c58264exv2w1.htm |
EX-10.1 - EX-10.1 - Virtual Radiologic CORP | c58264exv10w1.htm |
EX-99.1 - EX-99.1 - Virtual Radiologic CORP | c58264exv99w1.htm |
EX-99.2 - EX-99.2 - Virtual Radiologic CORP | c58264exv99w2.htm |
EX-10.2 - EX-10.2 - Virtual Radiologic CORP | c58264exv10w2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 13, 2010
May 13, 2010
VIRTUAL RADIOLOGIC CORPORATION
(Exact name of registrant as specified in its charter)
Delaware | 001 33815 | 27-0074530 | ||
(State or other jurisdiction of | (Commission File Number) | (I.R.S. Employer | ||
incorporation) | Identification Number) |
11995 Singletree Lane, Eden Prairie, Minnesota | 55344 | |
(Address of principal executive offices) | (Zip Code) |
(952) 595-1100
(Registrants telephone number, including area code)
(Registrants telephone number, including area code)
Not applicable.
(Former name or former address, if changed since last report)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
þ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. Entry into a Material Definitive Agreement.
Merger Agreement
On May 16, 2010, Virtual Radiologic Corporation, a Delaware corporation (the Company), entered
into an Agreement and Plan of Merger (the Merger Agreement) by and among the Company, Viking
Holdings LLC, a Delaware limited liability company (Parent), and Viking Acquisition Corporation,
a Delaware corporation and a wholly-owned subsidiary of Parent (Merger Sub). Pursuant to the
Merger Agreement, Merger Sub will be merged with and into the Company, and as a result the Company
will continue as the surviving corporation and as a wholly-owned subsidiary of Parent (the
Merger). Parent and Merger Sub are affiliates of Providence Equity Partners L.L.C. (PEP).
Pursuant to the Merger Agreement, at the effective time of the Merger, each issued and outstanding
share of common stock (including restricted stock) of the Company, other than shares owned by the
Company, Parent, Merger Sub or any other subsidiary of Parent and stockholders who have perfected
and not withdrawn a demand for appraisal rights under Delaware law, will be cancelled and
extinguished and automatically converted into the right to receive $17.25 in cash, without
interest. Each outstanding stock option of the Company will vest in full and be converted into the
right to receive an amount in cash equal to (i) the number of shares subject to such option
multiplied by (ii) the excess (if any) of $17.25 over the exercise price per share of such option.
The Merger Agreement contains a no-shop restriction on the ability of the Company to solicit
alternative acquisition proposals, provide information and engage in discussions with third
parties. The no-shop restriction is subject to a fiduciary-out provision, which provides that,
the Companys board of directors (the Company Board) may, prior to the time stockholder approval
is obtained, if the Company Board determines in good faith that the failure to do so would violate
its fiduciary duties to the stockholders under applicable law, (i) change its recommendation to the
Companys stockholders but only if such change of recommendation is directly related to an event,
fact, circumstance, development or occurrence that affects the assets or operations of the Company
that is unknown to the Company Board as of the date hereof but becomes known to the Company Board
prior to the stockholder approval or (ii) enter into a definitive agreement with respect to an
acquisition proposal, if, in response to a bona fide written acquisition proposal, that was not
solicited by the Company or any of its representatives and which the Company Board determines in
good faith, after consulting with its financial advisors and outside legal counsel and
consideration of all terms and conditions of such acquisition proposal, including the
conditionality and the timing and likelihood of consummation of such acquisition proposal, is more
favorable to the stockholders of the Company, including from a financial point of view, than the
terms set forth in the Merger Agreement (a Superior Proposal).
In either case described above, the Company must provide Parent with at least three business days
advance written notice (the Notice Period), advising Parent of its intention to change its
recommendation to the Companys stockholders or to terminate the Merger Agreement to enter into a
definitive agreement with respect to a Superior Proposal, provide Parent in writing the material
terms and conditions of a Superior Proposal and a copy of the relevant proposed transaction
documents with the party making the Superior Proposal and other material documents (but excluding
the identity of the potential acquirer), and discuss with Parent, to the extent Parent wishes to
discuss, any proposed changes by Parent to the terms of the Merger Agreement as to permit the
Company not to effect a change of its recommendation to the Companys stockholders or to terminate
the Merger Agreement in response to a Superior Proposal. In addition, following the Notice Period,
and taking into account any revised proposal made by Parent since the commencement of the Notice
Period, the Company Board must then determine in good faith after consultation with its outside
legal counsel and financial advisors that the Company Board is required to change its
recommendation to the Companys stockholders in the exercise of its
2
fiduciary duties, and, if in connection with a Superior Proposal, determine that the Superior
Proposal remains a Superior Proposal. Moreover, in the event of any material change to the
material terms of a Superior Proposal, the Company Board must deliver to Parent an additional
notice, which must comply with the information provided in any prior notice, except that if the
only material change is a change in price, then the deadline for the new written notice will be 36
hours (rather than three business days).
The Merger Agreement contains certain termination rights for both the Company and Parent. The
Merger Agreement provides that, upon termination under specified circumstances, the Company would
be required to pay Parent a termination fee of $9 million, depending on the timing and
circumstances of the termination and, under certain circumstances, to reimburse Parent for an
amount not to exceed $2.4 million for transaction expenses incurred by Parent and its affiliates.
The Companys reimbursement of Parents expenses would reduce the amount of any termination fee
that becomes payable by the Company pursuant to the Merger Agreement.
Consummation of the Merger is not subject to a financing condition but is subject to customary
conditions to closing, including the approval of a majority of the Companys stockholders and
receipt of requisite regulatory approvals.
Subject to the terms and conditions of the Merger Agreement, the Company is entitled to seek
specific performance against Parent to enforce Parents obligations under the Merger Agreement. In
addition, Parents obligation to pay the merger consideration and Parents and Merger Subs
liability for any breaches of the Merger Agreement, up to the aggregate merger consideration
amount, is guaranteed by funds affiliated with PEP subject to the terms and conditions set forth in
the guarantee.
The foregoing description of the Merger Agreement and the transactions contemplated thereby is only
a summary, does not purport to be complete, and is qualified in its entirety by the full text of
the Merger Agreement, which is attached as Exhibit 2.1 to this Current Report on Form 8-K and
incorporated herein by reference. The Board of Directors of the Company (the Board) unanimously
approved the Merger Agreement.
Goldman, Sachs & Co. served as the exclusive financial advisor to the Company. On May 16, 2010,
Goldman, Sachs & Co. delivered a written opinion to the Board that, as of the date of the opinion,
from a financial point of view, the consideration to be offered to the stockholders of the Company
in the Merger is fair to such stockholders.
On May 17, 2010, the Company issued two press releases announcing that it had entered into the Merger
Agreement. Copies of the press release are attached hereto as Exhibits 99.1 and 99.2, respectively.
The Merger Agreement has been included to provide investors and security holders with information
regarding its terms. It is not intended to provide any other factual information about the Company.
The representations, warranties, and covenants contained in the Merger Agreement were made only for
purposes of the Merger Agreement and as of specified dates, were solely for the benefit of the
parties to the Merger Agreement, and may be subject to limitations agreed upon by the parties to
the Merger Agreement, including being qualified by confidential disclosures exchanged between the
parties in connection with the execution of the Merger Agreement. The representations and
warranties in the Merger Agreement have been made for the purposes of allocating contractual risk
between the parties to the Merger Agreement instead of establishing these matters as facts, and may
be subject to standards of materiality applicable to the parties to the Merger Agreement that
differ from those applicable to investors. Investors are not third-party beneficiaries under the
Merger Agreement and should not rely on the representations, warranties, or covenants or any
descriptions thereof as characterizations of the actual state of facts or the actual condition of
the Company, Parent, or Merger Sub or any of their respective
3
subsidiaries or affiliates. Moreover, information concerning the subject matter of the
representations and warranties may change after the date of the Merger Agreement, which subsequent
information may or may not be fully reflected in the Companys public disclosures.
Voting and Proxy Agreements
On May 16, 2010, Dr. Eduard Michel, M.D., Ph.D., a director and the Chief Medical Officer of the
Company, and Generation Capital Partners VRC LP, a Delaware limited partnership, Generation
Members Fund II LP, a Delaware limited partnership, and Generation Capital Partners II LP, a
Delaware limited partnership (collectively, the Generation Funds) each entered into a voting and
proxy agreement with Parent (the Voting Agreements) pursuant to which Dr. Michel and the
Generation Funds agreed to vote in favor of or execute a written consent for the adoption and
approval of the Merger Agreement and the other transactions contemplated by the Merger Agreement,
and to vote against, among other things, any other acquisition proposals. Further, Dr. Michel and
the Generation Funds irrevocably appointed Parent as their respective agent, attorney and proxy to
vote their shares as set forth above. In addition, Dr. Michel and the Generation Funds each agreed
not to directly or indirectly transfer their respective shares of Company common stock during the
term of the Voting Agreements, subject to certain exceptions. Dr. Michel and the Generation Funds
represent approximately 31.3% of the Companys total shares outstanding as of May 13, 2010.
Further, the Voting Agreements contain a no-shop restriction on the ability of Dr. Michel and the
Generation Funds to solicit alternative acquisition proposals, provide information and engage in
discussions with third parties.
The foregoing description of the Voting Agreements is only a summary, does not purport to be
complete and is qualified in its entirety by reference to the Voting Agreements for Dr. Michel and
the Generation Funds, which are attached as Exhibits 10.1 and 10.2, respectively, to this Current
Report on Form 8-K and is incorporated herein by reference.
4
Additional Information and Where You Can Find It
In connection with the proposed transaction, the Company will file with the Securities and Exchange
Commission a proxy statement and relevant documents concerning the proposed transaction. INVESTORS
AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE COMPANY, THE MERGER AGREEMENT, AND THE TRANSACTIONS CONTEMPLATED BY THE
MERGER AGREEMENT. The proxy statement (when it becomes available) and any other documents filed by
the Company with the SEC may be obtained free of charge at the SECs website at
www.sec.gov. In addition, investors and security holders may obtain free copies of the
documents filed by the Company with the SEC by contacting the Companys Investor Relations
department by e-mail at info@virtualrad.com or by phone at (952) 595-1100. Investors and security
holders are urged to read the proxy statement and the other relevant materials when they become
available before making any voting or investment decisions with respect to the proposed
transaction. The Company and its directors, executive officers, and certain other members of its
management and employees may, under SEC rules, be deemed to be participants in the solicitation of
proxies from the Companys stockholders in connection with the transaction. Information regarding
the interests of such directors and executive officers (which may be different from those of the
Companys stockholders generally) is included in the Companys proxy statements and Annual Reports
on Form 10-K, previously filed with the SEC, and information concerning all of the Companys
participants in the solicitation will be included in the proxy statement relating to the proposed
transaction when it becomes available. Each of these documents is, or will be, available for free
at the SECs web site at www.sec.gov and at the Investor Relations page of the Companys
web site at www.virtualrad.com.
Item 5.07 Submission of Matters to a Vote of Security Holders.
The 2010 Annual Meeting of Stockholders of the Company was held on May 13, 2010. The final
results of the stockholder vote on each proposal brought before the meeting were as follows:
Broker | ||||||||||||
For | Withheld | Non-Votes | ||||||||||
Proposal One
Election of three
directors, each to
serve for a term of
three years |
||||||||||||
Nabil N. El-Hage |
9,522,972 | 3,964,829 | 1,662,171 | |||||||||
Richard J. Nigon |
9,523,565 | 3,964,236 | 1,662,171 | |||||||||
Brian Sullivan |
8,702,282 | 4,785,519 | 1,662,171 |
Broker | ||||||||||||||||
For | Withheld | Abstentions | Non-Votes | |||||||||||||
Proposal Two
Ratification of
the selection of
Deloitte & Touche LLP
as our independent
registered public
accounting firm |
11,141,983 | 110,578 | 3,897,411 | 0 | ||||||||||||
Proposal
ThreeApproval of
stockholder proposal
requesting the
adoption of a
majority vote
standard in the
election of directors |
6,698,123 | 6,778,102 | 11,576 | 1,662,171 |
Proposals One and Two were approved, and Proposal Three was not approved, by the required vote
of the Companys stockholders.
5
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. | Description | |
2.1
|
Agreement and Plan of Merger, dated May 16, 2010, by and among the Company, Viking Holdings LLC, and Viking Acquisition Corporation (filed herewith).* | |
10.1
|
Voting and Proxy Agreement, dated May 16, 2010, by and between Viking Holdings LLC and Eduard Michel, M.D., Ph.D. (filed herewith). | |
10.2
|
Voting and Proxy Agreement, dated May 16, 2010, by and among Viking Holdings LLC and Generation Capital Partners VRC LP, Generation Members Fund II LP, and Generation Capital Partners II LP (filed herewith). | |
99.1
|
Joint Press Release, dated May 17, 2010, issued by the Company and Providence Equity Partners L.L.C. (filed herewith). | |
99.2
|
Joint Press Release, dated May 17, 2010, issued by the Company and Generation Partners (filed herewith). |
* | Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company undertakes to furnish supplementally copies of any of the omitted schedules upon request by the Securities and Exchange Commission. |
6
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
VIRTUAL RADIOLOGIC CORPORATION | ||||||
Dated: May 17, 2010
|
By: | /s/ Michael J. Kolar
|
||||
Name: | Michael J. Kolar | |||||
Title: | Vice President, General Counsel and Secretary |
7
VIRTUAL RADIOLOGIC CORPORATION
FORM 8-K
INDEX TO EXHIBITS
Exhibit No. | Description | |
2.1
|
Agreement and Plan of Merger, dated May 16, 2010, by and among the Company, Viking Holdings LLC, and Viking Acquisition Corporation (filed herewith).* | |
10.1
|
Voting and Proxy Agreement, dated May 16, 2010, by and between Viking Holdings LLC and Eduard Michel, M.D., Ph.D. (filed herewith). | |
10.2
|
Voting and Proxy Agreement, dated May 16, 2010, by and among Viking Holding LLC and Generation Capital Partners VRC LP, Generation Members Fund II LP, and Generation Capital Partners II LP (filed herewith). | |
99.1
|
Joint Press Release, dated May 17, 2010, issued by the Company and Providence Equity Partners L.L.C. (filed herewith). | |
99.2
|
Joint Press Release, dated May 17, 2010, issued by the Company and Generation Partners (filed herewith). |
* | Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company undertakes to furnish supplementally copies of any of the omitted schedules upon request by the Securities and Exchange Commission. |