TIDMCHT
RNS Number : 1554Q
Constellation Healthcare Tech, Inc
25 November 2016
25 November 2016
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
RECOMMED ACQUISITION
of
Constellation Healthcare Technologies, Inc. ("CHT" or the
"Company")
by CHT Holdco LLC ("Parent")
through its wholly owned subsidiary CHT Merger Sub, Inc.
("Sub")
to be effected under the terms of a merger agreement between
CHT, Parent, Sub and others
The board of each of CHT and Parent are pleased to announce that
they have reached agreement on the terms of a recommended
acquisition ("Acquisition") under which Parent will acquire CHT
pursuant to the terms of an agreement and plan of merger entered
into on 24 November 2016 between CHT, Parent, Sub and others
("Merger Agreement").
Summary
-- Under the terms of the Acquisition, CHT Shareholders will be entitled to receive:
for each Common Share $2.93 in cash; and
$0.43 in Promissory Notes
together amounting to $3.36 ("Acquisition Price").
-- The Acquisition Price is the equivalent of GBP2.70 per Common
Share on the basis of an exchange rate of $1.2457 to GBP1.00 as at
24 November 2016 (being the Business Day prior to the date of this
announcement). The Acquisition Price is fixed and will be paid in
USD and the risk and rewards of fluctuations of the Sterling
equivalent at closing will be borne by CHT Shareholders.
-- The Acquisition Price values the entire issued and to be
issued share capital of CHT at approximately $309.4 million and
represents a premium of approximately 45 per cent. to the Closing
Price of 186 pence on 24 November 2016 (being the last Business Day
prior to the date of this announcement) on the basis of an exchange
rate of $1.2457 to GBP1.00 as at 24 November 2016.
-- The Acquisition Price also represents a premium of approximately:
o 30.2 per cent. to the all-time high closing price of 211.5
pence per Common Share on 17 October 2016;
o 33.4 per cent. to the Closing Price of 206.5 pence on 12
October 2016 (being the Business Day prior to the date of the
Offer); and
o 76.8 per cent. to the volume weighted average Closing Price of
155.8 pence for the three month period ended 12 October 2016 (being
the Business Day prior to the date of the Offer),
in each case, on the basis of an exchange rate of $1.22 to
GBP1.00 as at 12 October 2016.
-- The Promissory Notes shall accrue payment-in-kind (PIK)
interest at an annual rate of 5 per cent., be payable by CHT or
Parent (or an intermediary holding company between the Surviving
Corporation or Parent) on or prior to the date that is the seventh
anniversary of the issuance date, will be unsecured, will not be
registered for listing or trading and will be subject to typical
transfer restrictions. If any CHT Shareholder does not sign a
Voting Agreement which contains a release of claims under the laws
of the State of Delaware, the value of its Promissory Notes may
reduce in certain circumstances as described in this
announcement.
-- The Parmar Controlled Entities are selling approximately 38
per cent. of their Common Shares in CHT.
-- The Parent is a US-based company which is backed by CC
Capital Management, LLC ("CC Capital") and Paul Parmar, the Chief
Executive Officer of CHT.
-- CC Capital is a US-based company which will provide part of
the financing to the Parent in connection with the Acquisition.
-- Bank of America Merrill Lynch has committed to provide senior
credit facilities to Parent in connection with the Acquisition and
for ongoing working capital purposes of up to $145 million subject
to certain conditions being satisfied prior to closing.
-- CHT provides a holistic, integrated suite of practice
management support services to hospitals and medical practices
across the United States.
-- The Acquisition is not governed by the Takeover Code and, as
such, CHT Shareholders will not be afforded the protections of the
Takeover Code but is governed by the laws of the State of
Delaware.
-- The Acquisition is subject to the approval of Shareholders at
a General Meeting of the Company to be convened by way of an
explanatory circular and notice of meeting ("Proxy Statement") to
be published as soon as practicable and, in any event, within 30
days of the date of this announcement. The Resolution will require
(i) the approval of CHT Shareholders (including the Parmar
Controlled Entities) holding Common Shares representing at least 89
per cent. of the issued and outstanding Common Shares; (ii) Company
Stockholder Approval (being an affirmative vote of a majority of
the aggregate voting power of the issued and outstanding shares of
Common Shares); and (iii) Majority of the Minority Approval (being
the holders of the majority of outstanding Common Shares other than
those Common Shares held by any officer of CHT or held by the
Parmar Controlled Entities). Whilst the Parmar Controlled Entities
(holding 53.5 per cent. of the total outstanding Common Shares in
the Company at closing) are entitled to vote in respect of a
Company Stockholder Approval, they are not entitled to have their
votes counted in respect of a Majority of the Minority
Approval.
-- The Special Committee, which comprises all of the Board save
for Mark Feuer, Paul Parmar and Sam Zaharis, consider the terms of
the Acquisition to be fair to all CHT Shareholders other than the
Parmar Controlled Entities. Accordingly, the Special Committee has
unanimously approved the transaction and intend unanimously to
recommend that CHT Shareholders vote in favour of the Acquisition
and the Resolution to be proposed at the General Meeting.
-- The Acquisition is subject to the satisfaction or waiver of
the conditions and further terms that are set out in the Merger
Agreement and summarised in paragraph 12 of this announcement and
which will be further described in the Proxy Statement.
-- Following the signing of the Merger Agreement, CHT is
permitted, on the terms and subject to the conditions of the Merger
Agreement, to initiate, solicit and encourage enquiries from and
engage in discussions with third parties relating to alternative
acquisition proposals during the Go-Shop Period.
Commenting on the Acquisition, John Johnston, Chairman of CHT
said:
"This deal will provide the capital that Constellation
Healthcare Technologies needs to grow its business at the rate that
changes in its market demands while at the same time giving an
excellent return to shareholders since IPO."
This summary should be read in conjunction with the full text of
this announcement and its appendix.
The appendix to this announcement contains definitions of
certain terms used in this summary and in this announcement. The
appendix forms part of this announcement.
Enquiries:
CC Capital Management, LLC
Doug Newton newton@cc.capital
Finsbury - PR adviser to CC Capital
Charles O'Brien (UK) Tel: +44 20 7251 3801
charles.obrien@finsbury.com
Kal Goldberg (US) Tel: +1 646 805 2005
kal.goldberg@finsbury.com
Chris Ryall (U.S.) Tel: +1 646 805 2078
chris.ryall@finsbury.com
Constellation Healthcare Technologies, Inc.
Paul Parmar, Chief Executive Officer c/o Redleaf Communications
Sotirios ("Sam") Zaharis, Chief Financial Officer Tel: +44 20 7382 4730
finnCap Tel: +44 20 7220 0500
Stuart Andrews / Julian Blunt / Scott Mathieson Corporate Finance
Simon Johnson Corporate Broking
Redleaf Communications - PR adviser to CHT Tel: +44 20 7382 4730
Charlie Geller / Sam Modlin constellation@redleafpr.com
Important Notices:
Disclaimers
finnCap, which is authorised and regulated in the UK by the
Financial Conduct Authority is acting exclusively for CHT and no
one else in connection with the matters set out in this
announcement. In connection with such matters, finnCap will not
regard any other person as their client, nor will they be
responsible to any other person for providing the protections
afforded to clients of finnCap or for providing advice in relation
any matter referred to herein.
This announcement is for information purposes only and is not
intended to, and does not constitute, or form part of any offer,
invitation, inducement or the solicitation of an offer to purchase,
otherwise acquire, subscribe for, sell or otherwise dispose of or
exercise rights in respect of any securities or the solicitation of
any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise. Any vote, decision in respect of, or
other response to, the Acquisition should be made only on the basis
of the information contained in the Proxy Statement. Each CHT
Shareholder is urged to consult its independent professional
advisers immediately regarding the tax consequences of the
Acquisition applicable to them.
In accordance with normal practice in the United Kingdom, the
Parent or its nominees, or its brokers (acting as agents), may from
time to time make certain purchases of, or arrangements to
purchase, Common Shares, other than pursuant to the Acquisition,
until the date on which the Acquisition becomes Effective, lapses
or is otherwise withdrawn. These purchases may occur either in the
open market at prevailing prices or in private transactions at
negotiated prices. Any information about such purchases will be
disclosed as required in the United Kingdom, will be reported to a
Regulatory Information Service and will be available on the London
Stock Exchange website at www.londonstockexchange.com.
Overseas Shareholders
The ability of Overseas Shareholders to participate in the
Acquisition and the distribution of this announcement in, into or
from jurisdictions other than the United Kingdom may be restricted
by the laws of those jurisdictions and therefore persons into whose
possession this announcement comes should inform themselves of, and
observe, any such restrictions. Any person (including without
limitation, nominees, trustees and custodians) who would, or
otherwise intends to, forward this announcement, the Proxy
Statement, the Form of Proxy or any accompanying document to any
jurisdiction outside the United Kingdom should refrain from doing
so and seek appropriate professional advice before taking any
action. If any Overseas Shareholder remains in any doubt, it should
consult an appropriate independent professional adviser in its
relevant jurisdiction without delay. In particular, the ability of
persons who are not resident in the United Kingdom to vote their
Common Shares at the General Meeting or to execute and deliver a
Form of Proxy appointing another to vote their Common Shares in
respect of the General Meeting on their behalf, may be affected by
the laws of the relevant jurisdiction in which they are
located.
Failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any person.
This announcement has been prepared for the purposes of complying
with the AIM Rules and the laws of England and Wales and the
information disclosed may not be the same as that which would have
been disclosed if this document and the accompanying documents had
been prepared in accordance with the laws of other jurisdictions.
In particular, the Acquisition is not governed by the Takeover Code
and CHT Shareholders will not be afforded the protection of the
Takeover Code.
This announcement is not intended to, and does not, constitute
or form part of any offer or invitation to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of, any
securities or the solicitation of any vote or approval pursuant to
the Acquisition or otherwise, in any jurisdiction in which such
offer, invitation or solicitation is unlawful.
Forward-Looking Statements
This announcement contains statements about CHT, Parent and Sub
that are or may be forward-looking statements which are prospective
in nature. All statements other than statements of historical facts
may be forward-looking statements. Often, but not always,
forward-looking statements can be identified by the use of
forward-looking words such as "targets", "plans", "believes",
"expects", "aims", "intends", "will", "should", "could", "would",
"may", "anticipates", "estimates", "synergy", "cost-saving",
"projects", "goal" or "strategy" or, words or terms of similar
substance or the negative thereof. Forward-looking statements may
include statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy,
losses and future prospects; (ii) business and management
strategies and the expansion and growth of CHT's and Parent's
operations and potential synergies resulting from the Acquisition;
and (iii) the effects of government regulation on CHT's and
Parent's business.
These forward-looking statements are not guarantees of future
performance. Such forward-looking statements involve known and
unknown risks and uncertainties that could significantly affect
expected results and are based on certain key assumptions. Many
factors could cause actual results to differ materially from those
projected or implied in any forward-looking statements. Due to such
uncertainties and risks, readers are cautioned not to place undue
reliance on such forward-looking statements, which speak only as of
the date of this announcement. All subsequent oral or written
forward-looking statements attributable to CHT and Parent or any of
their respective members, directors, officers or employees or any
persons acting on their behalf are expressly qualified in their
entirety by the cautionary statement above. CHT and Parent disclaim
any obligation to update any forward-looking or other statements
contained in this announcement, except as required by applicable
law.
No Profit Forecasts or Estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for CHT or Parent, as appropriate, for the
current or future financial years would necessarily match or exceed
the historical published earnings or earnings per share for CHT or
Parent, as appropriate.
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them.
Exchange Rates
The Acquisition Price is fixed in USD and the risk of
fluctuations of the Sterling equivalent at closing will be borne by
CHT Shareholders. Amounts not denominated in Sterling in this
announcement have been converted into Sterling at the prevailing
exchange rate as quoted from Bloomberg at the close of business in
London on the relevant date.
25 November 2016
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
RECOMMED ACQUISITION
of
Constellation Healthcare Technologies, Inc. ("CHT" or the
"Company")
by CHT Holdco, LLC ("Parent")
through its wholly owned subsidiary CHT Merger Sub, Inc.
("Sub")
to be effected under the terms of a merger agreement between
CHT, Parent, Sub and others
1. Introduction
The board of each of CHT and Parent are pleased to announce that
they have reached agreement on the terms of a recommended
acquisition ("Acquisition") under which Parent will acquire CHT
pursuant to the terms of an agreement and plan of merger entered
into on 24 November 2016 between CHT, Parent, Sub and others
("Merger Agreement").
2. The Acquisition
Under the terms of the Acquisition, which is subject to the
conditions and further terms set out in the Merger Agreement (and
summarised in paragraph 12 of this announcement), CHT Shareholders
will be entitled to receive:
for each Common Share $2.93 in cash; and
$0.43 in Promissory Notes
together amounting to $3.36 ("Acquisition Price").
The Acquisition Price is the equivalent of GBP2.70 per Common
Share on the basis of an exchange rate of $1.2457 to GBP1.00 as at
24 November 2016 (being the Business Day prior to the date of this
announcement). The Acquisition Price is fixed and will be paid in
USD and the risk and rewards of fluctuations of the Sterling
equivalent at closing will be borne by CHT Shareholders.
The Acquisition Price values the entire issued and to be issued
share capital of CHT at approximately $309.4 million and represents
a premium of approximately 45 per cent. to the Closing Price of 186
pence on 24 November 2016 (being the last Business Day prior to the
date of this announcement) on the basis of an exchange rate of
$1.2457 to GBP1.00 as at 24 November 2016.
The Acquisition Price also represents a premium of
approximately:
-- 30.2 per cent. to the all-time high closing price of 211.5
pence per Common Share on 17 October 2016;
-- 33.4 per cent. to the Closing Price of 206.5 pence on 12
October 2016 (being the Business Day prior to the date of the
Offer); and
-- 76.8 per cent. to the volume weighted average Closing Price
of 155.8 pence for the three month period ended 12 October 2016
(being the Business Day prior to the date of the Offer),
in each case, on the basis of an exchange rate of $1.22 to
GBP1.00 as at 12 October 2016.
The Common Shares will be acquired by Parent fully paid and free
from all liens, equitable interests, charges, encumbrances, rights
of pre-emption and any other third party rights or interests
whatsoever and together with all rights existing at the date of
this announcement or thereafter attaching thereto.
The Promissory Notes shall accrue payment-in-kind (PIK) interest
at an annual rate of 5 per cent., be payable by CHT or Parent (or
an intermediary holding company between the Surviving Corporation
or Parent) on or prior to the date that is the seventh anniversary
of the issuance date, will be unsecured, will not be registered for
listing or trading and will be subject to typical transfer
restrictions. If any CHT Shareholder does not sign a Voting
Agreement which contains a release of claims under the laws of the
State of Delaware, the value of its Promissory Notes may reduce in
certain circumstances. Further terms of the Promissory Notes are
summarised in paragraph 11 below.
The Acquisition is conditional on all conditions having been
satisfied or waived by 15 February 2017.
3. Recommendation
The Special Committee, which comprises all of the Board save for
Mark Feuer, Paul Parmar and Sam Zaharis, consider the terms of the
Acquisition to be fair to all CHT Shareholders other than the
Parmar Controlled Entities. Accordingly, the Special Committee has
unanimously approved the transaction and intend unanimously to
recommend that CHT Shareholders vote in favour of the Acquisition
and the Resolution to be proposed at the General Meeting.
McGuireWoods, in its capacity as legal counsel, is representing
the Special Committee in connection with the Acquisition and will
represent Paul Parmar in making regulatory filings required under
United States law.
4. Background to and reasons for the Acquisition
CC Capital is a private firm that acquires and operates
controlling interests in high quality businesses. It focuses on
buying, holding and managing businesses that operate in industries
with an attractive growth profile, companies that have strong cash
flow attributes and face minimal threats of technological or
competitive obsolescence. CC Capital believes that existing and new
customers of CHT can draw confidence from the reputation of CC
Capital and the track record of its founders.
CC Capital believes that certain of the challenges facing CHT
during the foreseeable future could be addressed more effectively
as a private company with access to additional capital and its
long-term ownership perspective.
5. Background to and reasons for the Special Committee's recommendation
After due consideration of CHT's circumstances and the market
within which it operates, the Special Committee has concluded that
the Acquisition substantially recognises CHT's growth prospects, as
well as the risks associated with those prospects.
Accordingly, the Special Committee believes that the Acquisition
Price represents an opportunity for CHT Shareholders (other than
the Parmar Controlled Entities) to realise value for their holdings
of Common Shares at an attractive premium to the Common Share price
prior to the Acquisition being announced.
The Special Committee believes the Acquisition is in the best
interests of CHT Shareholders (other than the Parmar Controlled
Entities) and, therefore, intend unanimously to recommend that CHT
Shareholders vote in favour of the Acquisition and the Resolution
to be proposed at the General Meeting.
6. Voting support
The Acquisition is subject to both Company Stockholder Approval
and Majority of the Minority Approval having been obtained. Whilst
the Parmar Controlled Entities (holding 53.5 per cent. of the total
outstanding shares in the Company at closing) are entitled to vote
in respect of a Company Stockholder Approval, they are not entitled
to have their votes counted in respect of a Majority of the
Minority Approval. If the Company fails to satisfy either of these
voting conditions and they are not waived by Parent such that the
Acquisition does not complete, then the Company will be liable to
reimburse CC Capital's reasonable expenses of up to $4 million.
It is a condition of the Merger Agreement that the Parmar
Controlled Entities shall execute and deliver a Voting Agreement
pursuant to which such persons shall agree to vote in favour of the
Acquisition in respect of a total of 49,302,598 Common Shares
representing approximately 53.5 per cent. of the Common Shares
outstanding at the closing of the Acquisition.
It is also a condition of the Merger Agreement that CHT
Shareholders (including the Parmar Controlled Entities) holding
Common Shares representing at least 89 per cent. of the issued and
outstanding Common Shares: (i) execute and deliver Voting
Agreements; and (ii) vote in favour of the Merger Agreement. If the
Company fails to satisfy either of these voting conditions and they
are not waived by Parent such that the Acquisition is not
consummated, then the Company will be liable to pay CC Capital a
fee of $10 million and reimburse CC Capital's reasonable expenses
of up to $4 million.
7. Go-Shop
Following the signing of the Merger Agreement, CHT is permitted
to initiate, solicit and encourage enquiries from and engage in
discussions with third parties relating to alternative acquisition
proposals during the Go-Shop Period ("Go-Shop"). Further terms and
conditions relating to the Go-Shop are set out in the Merger
Agreement and summarised in paragraph 12 below. In the event that a
superior proposal is forthcoming from a third party which amounts
to a Superior Proposal Determination, then the Voting Agreement
permits the relevant CHT Shareholders to vote in favour of such a
proposal.
8. Termination payments
The Merger Agreement contains circumstances in which certain
parties may be obliged to make termination payments including:
-- if Company Stockholder Approval or Majority of the Minority
Approval is not obtained, CHT will pay the reasonable expenses of
CC Capital up to a maximum cap of $4 million ("Company Expense
Reimbursement");
-- if Parent terminates due to an intentional breach of CHT's
representations, CHT will pay CC Capital $16.1 million ("Tier 3
Termination Fee") plus the Company Expense Reimbursement;
-- if CHT has received Voting Agreements from fewer than 89 per
cent. of CHT shareholders or fewer than 89 per cent. of CHT
shareholders vote in favour of the Merger Agreement, and Parent
terminates, CHT will pay to CC Capital $10 million ("Tier 2
Termination Fee") plus the Company Expense Reimbursement;
-- if CHT terminates due to:
o a non-intentional breach of Parent or Sub representations,
then Parent will pay to CHT the reasonable expenses of CHT capped
at $2 million ("Parent Expense Reimbursement"); or
o an intentional breach of Parent or Sub representations, then
Parent will pay to CHT $16.1 million ("Tier 2 Reverse Termination
Fee") and the Parent Expense Reimbursement;
-- if CHT or Parent terminates due to a Superior Proposal Determination made:
o during the Go-Shop Period, resulting in a Change in
Recommendation serving as the basis of such termination, then CHT
will pay to CC Capital $8 million ("Tier 1 Termination Fee") and
the Company Expense Reimbursement; or
o after the Go-Shop Period, resulting in a Change in
Recommendation serving as the basis of such termination, then
Company will pay to CC Capital the Tier 3 Termination Fee and the
Company Expense Reimbursement;
-- if Parent terminates due to failure to close the financing of
the Acquisition, then CC Capital will pay CHT a fee of $10 million
("Tier 1 Reverse Termination Fee") and the Parent Expense
Reimbursement.
Further details relating to termination payments are summarised
in paragraph 12 below.
9. Information on Parent and Sub
The Parent and the Sub are newly incorporated companies formed
at the direction of CC Capital and Paul Parmar for the purpose of
implementing the Acquisition. Save for activities in connection
with the making, implementation and financing of the Acquisition,
neither the Parent nor the Sub have carried on any business prior
to the date of this announcement. Neither Parent nor Sub has
prepared any historical financial accounts.
10. Information on CHT
CHT provides a holistic, integrated suite of practice management
support services to hospitals and medical practices across the
United States. CHT's main business involves the provision of
revenue cycle management services to medical practices and
hospitals using IT based billing systems, together with
sophisticated automation and workflow management with a view to
optimising the medical billing and cash collection processes. CHT
also manages a group purchasing organisation business focused on
the procurement of vaccines, flu shots and other drugs on behalf of
participating physicians to lower vaccine costs through volume
pricing with pharmaceutical suppliers.
CHT's mission is to work in partnership with its clients to lead
the evolution of the health care industry. CHT enables its clients
to seamlessly access and integrate patient data, diagnostic data,
lab and test data, and pharmacology data to improve the quality of
care for their patients, while providing automated and optimised
technical and logistical support to create and sustain long-term,
bottom-line success for its clients.
11. Financing the Acquisition
First United Health LLC, a Delaware limited liability company
("FUH") and Constellation Health LLC, a Delaware limited liability
company ("CH") both companies in respect of which Paul Parmar is a
manager have formed a new company Alpha Cepheus, LLC, a Delaware
limited liability company ("AC") for the purposes of the
Acquisition.
Of the 39,892,833 Common Shares held by Parmar Controlled
Entities in the Company, such entities are proposing to sell
15,037,196 Common Shares in aggregate through the Acquisition which
in aggregate amounts to approximately 38 per cent. of their
shareholding in the Company. The balance of such Common Shares
(being 24,855,637 Common Shares) have been contributed to Parent by
FUH and CH, via AC. FUH has further contributed a loan agreement
and promissory note to Parent in the principal amount of US$12
million.
In connection with the closing of the Acquisition, CC Capital
will make an equity subscription amounting to approximately $88.7
million in the capital of Parent so that on closing CC Capital will
have a 50.7 per cent. economic interest in the capital of Parent
and AC shall have a 49.3 per cent. economic interest. The proceeds
of CC Capital's contribution will be applied to the satisfaction of
part of the cash consideration payable under the terms of the
Acquisition. CC Capital's subscription to Parent is subject to the
satisfaction of the conditions to the Acquisition being satisfied
prior to or contemporaneously with CC Capital's contribution.
The balance of the total consideration payable under the terms
of the Acquisition will be funded from new committed facilities
established by Parent with Bank of America Merrill Lynch ("Bank").
The Bank has committed to provide senior credit facilities of up to
$145 million pursuant to a commitment letter, the terms of which
are summarised in paragraph 13 below.
As part of the transaction, CH, AC and FUH and Paul Parmar
personally have agreed to indemnify CC Capital for a period of nine
months from the execution of the Merger Agreement for breaches of
representations and warranties, and breach of covenants by CHT
under the Merger Agreement and representations, warranties and
covenants made under the subscription agreement with CC Capital. As
collateral for the indemnification obligations during this
indemnification period, CH, AC and FUH have each executed pledge
and security agreements with CC Capital CHT Holdco LLC as the
secured party which includes security over their direct and
indirect interest in Common Shares.
The Promissory Notes shall be issued by CHT or Parent (or an
intermediary holding company between the Surviving Corporation or
Parent) in a form to be reasonably agreed upon in good faith by CHT
and Parent. The Promissory Notes shall: (i) be denominated in U.S.
dollars; (ii) accrue payment-in-kind (PIK) interest at an annual
rate of 5 per cent.; (iii) be payable by the issuer thereof (at
such issuer's election) on or prior to the date that is the seventh
anniversary of the issuance date; (iv) not be registered for
listing or trading; and (v) be subject to restrictions on transfer.
The Promissory Notes are unsecured.
To the extent there are any Proceedings brought by any current
or former CHT Shareholder directly or indirectly with respect to
the Company, Parent, Sub, the Surviving Corporation, CC Capital or
any of their respective Affiliates relating to or arising from the
Merger and which results in any losses, the face value of each
Promissory Note to be issued to a CHT Shareholder that does not
sign a Voting Agreement governed by the laws of the State of
Delaware which contains a release of claims under the laws of the
State of Delaware shall be reduced dollar-for-dollar on a pro rata
basis for such losses. Any offset to any Promissory Note issued to
such CHT Shareholder shall be treated as an adjustment to the
merger consideration.
12. Structure of the Acquisition
It is intended that the Acquisition will be implemented by way
of the Merger Agreement entered into between CC Capital, Orion
Healthcorp, Inc. (a wholly owned subsidiary of CHT) ("Orion"),
Parent, Sub and CHT, a summary of the principal terms and
conditions of which are set out below.
-- The Acquisition
Pursuant to the terms of the Merger Agreement, Sub shall be
merged with and into CHT, with CHT being the surviving corporation
("Surviving Corporation"). Upon such event taking place, the Common
Shares not held by members of the Purchaser Group will be converted
into the right to receive the Acquisition Price.
-- Representations and Warranties ("representations")
The parties are making representations customary for
transactions of this type.
-- Conditions to closing
o Conditions to Each Party's Obligation to Effect the
Acquisition: Majority of the Minority Approval; Company Stockholder
Approval; no Governmental Entity taking action enjoining or
otherwise prohibiting consummation of the Acquisition and no person
initiating a Proceeding for such enjoinment; and termination or
expiration of HSR waiting period (if applicable).
o Conditions to Parent and Sub's Obligations to Effect the
Acquisition: certain Company representations true and correct as of
the signing date and as of the closing; Company performance of all
obligations and delivery of certificate affirming same to Parent;
all conditions to closing of the contribution of certain shares and
other securities by Contributing Entities ("Contribution")
satisfied, waived, or will be satisfied at closing, and the
Contribution has been consummated or will be consummated
contemporaneously with closing; execution and delivery of
employment agreements for certain key employees; no Company
Material Adverse Effect has occurred; execution and delivery of
Voting Agreements by CHT Shareholders holding at least 89 per cent.
of issued and outstanding Common Shares and no such shareholders
having revoked, attempted to revoke or challenged the validity or
enforcement of such agreement and 89 per cent of the issued and
outstanding Common Shares having voted in favour of the Merger
Agreement; and all conditions to the closing of the financing of
the transaction ("Financing") have been satisfied or waived and the
Financing has been or will be consummated contemporaneously with
closing.
o Conditions to the Company's Obligations to Effect the
Acquisition: Representations of Parent and Sub are true and correct
as of the signing date and as of closing and Parent and Sub have
performed all obligations and delivered a certificate affirming
same to Company.
-- Termination
o Company or Parent: Company or Parent may terminate: upon
mutual written agreement; should any Governmental Entity take
action prohibiting the consummation of the Acquisition; upon a
Change in Recommendation as a result of a Superior Proposal
Determination or public announcement of an intention to effect the
foregoing (see below); should the Company Stockholder Approval or
the Majority of the Minority Approval not be obtained; or if the
Acquisition has not occurred before February 15, 2017 ("Outside
Date") unless this is due to the failure of the terminating party
to fulfil its obligations in any material respect.
o Company: Company may terminate upon a breach of any Parent or
Sub representation uncured for 30 days following written notice of
such breach.
o Parent: Parent may terminate upon a breach of any Company
representation uncured for 30 days, or within 10 days of receipt of
an update to the disclosure schedules to the Merger Agreement
evidencing breach of Company representations; should CHT
Shareholders holding at least 89 per cent. of issued and
outstanding Common Shares not execute and deliver Voting Agreements
to the Company and vote in favour of the Merger Agreement (subject
to the below); or upon failure to consummate the Financing,
provided that CC Capital may not terminate upon failure to
consummate the Financing without first paying $10 million ("Tier 1
Reverse Termination Fee") plus the Parent Expense Reimbursement to
the Company.
o Effect of Termination: If Parent or Company terminates due to
the Company Stockholder Approval or Majority of the Minority
Approval not having been obtained or the Acquisition not having
occurred before the Outside Date, or if Parent terminates due to
breach of Company representations, Company will pay the reasonable
expenses of CC Capital, with such expenses capped at $4 million
unless termination has occurred due to failure to consummate the
Acquisition prior to the Outside Date (because no Governmental
Entity taking action enjoining or otherwise prohibiting
consummation of the Acquisition; and termination or expiration of
HSR waiting period (if applicable)), in such case, reimbursement
will be capped at $2 million. If Parent terminates due to an
intentional breach of Company representations, Company will pay CC
Capital $16.1 million ("Tier 3 Termination Fee") plus the Company
Expense Reimbursement. If Company has received Voting Agreements
from fewer than 89 per cent. of CHT shareholders or fewer than 89
per cent. of CHT shareholders vote in favour of the Merger
Agreement and Parent terminates, Company will pay CC Capital $10
million ("Tier 2 Termination Fee") and the Company Expense
Reimbursement. If Company terminates due to a non-intentional
breach of Parent or Sub representations, then Parent will pay to
Company an expense reimbursement capped at $2 million ("Parent
Expense Reimbursement"). If Company terminates due to an
intentional breach of Parent or Sub representations, then Parent
will pay to Company $16.1 million ("Tier 2 Reverse Termination
Fee") and the Parent Expense Reimbursement. If Company or Parent
terminates due to a Superior Proposal Determination made during the
Go-Shop Period resulting in a Change in Recommendation serving as
the basis of such termination, then Company will pay to CC Capital
$8 million ("Tier 1 Termination Fee") and the Company Expense
Reimbursement. If Company or Parent terminates due to a Superior
Proposal Determination made after the Go-Shop Period resulting in a
Change in Recommendation serving as the basis of such termination,
then Company will pay to CC Capital the Company Expense
Reimbursement and the Tier 3 Termination Fee. If Parent terminates
due to failure to close the Financing, then CC Capital will pay to
Company the Tier 1 Reverse Termination Fee and the Parent Expense
Reimbursement.
-- Guarantee
Orion absolutely and unconditionally guarantees the full and
prompt payment of any Termination Fee and/or Company Expense
Reimbursement, as well as all other payment obligations of the
Company. CC Capital absolutely and unconditionally guarantees the
full and prompt payment of any Reverse Termination Fee and/or
Parent Expense Reimbursement and all other payment obligations of
each of Parent and Sub.
-- Covenants
During the period between the date of this announcement and the
date of closing of the Acquisition ("Pre-Closing Period") CHT
covenants to ensure that the business and operations of each of the
Acquired Corporations shall be conducted in the ordinary course of
business consistent with past practices, and in compliance with all
applicable law (including, without limitation, healthcare laws) and
the requirements of all material contracts; and CHT shall use
reasonable best efforts to ensure that each of the Acquired
Corporations (A) preserves intact its current business
organisation, (B) preserves its existing relationships and goodwill
with all customers, suppliers and others having significant
business dealings with it and with all Governmental Entities, (C)
keeps available the services of its current officers and other
employees. Without limiting the generality of the foregoing, except
(w) as may be required by law or requested by a Governmental
Entity, (x) with the prior written consent of Parent, (y) as
required or specifically requested by or pursuant to the Merger
Agreement or (z) as disclosed, during the Pre-Closing Period, the
Acquired Corporations covenant not to do certain acts or things
including, but not limited to, not making changes to its share
capital and not acquiring or disposing of assets outside the
ordinary course of business.
-- Go Shop
During the Go-Shop Period, the Acquired Corporations and their
respective representatives shall have the right to, directly or
indirectly: (i) solicit or initiate, or induce, facilitate or
encourage, the making, submission or announcement of any
Acquisition Proposal or take any action that would reasonably be
expected to lead to an Acquisition Proposal; (ii) furnish any
non-public information regarding any of the Acquired Corporations
to any Person in connection with or in response to an Acquisition
Proposal (other than any notes, analysis or other documents or
materials prepared by CC Capital); and (iii) engage in discussions
or negotiations with any Person with respect to any Acquisition
Proposal.
13. Acquisition-related documents
In connection with the Acquisition, additional documents will be
entered into including those summarised below.
-- Voting Agreements
The Merger Agreement contemplates the execution and delivery of
Voting Agreements by CHT Shareholders holding at least 89 per cent.
of issued and outstanding Common Shares, to vote or procure votes
in favour of the Resolution to be proposed at the General Meeting
to approve the Merger.
-- Employment Agreement
Following the Acquisition, Paul Parmar shall remain as the Chief
Executive Officer ("CEO") of CHT and shall enter into an employment
agreement with CHT. The employment term, subject to typical
termination provisions contained in the agreement, is for a period
of four years. The CEO's annual base salary for the term shall be
$250,000. The CEO shall be eligible to receive an annual
performance bonus having a target of $250,000 relating to each
complete calendar year during the term.
In the event of the CEO's termination of employment without
"cause" or for "good reason," or the CEO's resignation following a
"change of control" of CHT (as each term is defined in the
employment agreement) during the term, subject to the conditions
set out in the agreement, he will be entitled to severance payments
equal to $1,000,000 in the aggregate, payable over two years, and
continued medical, dental and life insurance benefits for two
years.
The CEO will be subject to two year non-compete and
non-solicitation restrictions should he leave CHT.
-- Consulting Agreement
Paul Parmar, shall indirectly enter into a consulting agreement
with Parent pursuant to which he shall, indirectly, receive an
annual fee of $250,000 and be eligible for an annual
performance-based fee of $250,000. The consulting term is for a
period of four years, unless earlier terminated in accordance with
the agreement.
-- Bank Commitment Letter
Bank of America Merrill Lynch ("Bank") and Parent have entered
into a commitment letter pursuant to which the Bank will provide
senior credit facilities of up to $145 million comprising a term
loan of up to $130 million and a revolving credit facility of up to
$15 million. The commitment is subject to the parties agreeing
definitive loan documentation. The senior credit facilities will be
subject to conditions including the satisfaction of typical
conditions precedent to closing and the accuracy of specified
representations including:
o there not having occurred since the date of the Merger
Agreement any event or condition that has had or could be
reasonably expected, either individually or in the aggregate, to
have a material adverse effect on, among other things, the
business, condition (financial or otherwise), prospects,
operations, assets or financial performance of the Acquired
Corporations taken as a whole;
o the representations and warranties in connection with CHT in
the Merger Agreement that are material to the interests of the
lenders; and
o the representations and warranties of the borrower and the
guarantors in the definitive loan documentation relating to, among
other things, corporate or other organisational existence,
corporate power and authority to enter into the loan documentation,
due authorisation, execution and delivery of the loan documentation
and non-contravention of laws as a result of entering into the loan
documents.
14. Related Party Transaction
The entering into of the Merger Agreement on 24 November 2016
between, amongst other parties, CHT and Parent (which on such date
was controlled, directly or indirectly by Paul Parmar), and the
entering into of Voting Agreements by Paul Parmar, Sam Zaharis and
the Parmar Controlled Entities for the purposes of giving full
effect to the Acquisition are both related party transactions
within the meaning of the AIM Rules. In accordance with and as
required by the AIM Rules, the members of the Special Committee,
having consulted with finnCap, consider that these arrangements are
fair and reasonable insofar as the Company's shareholders are
concerned.
15. Additional issue of shares
It is contemplated by the Merger Agreement that during the
Pre-Closing Period further Common Shares will be issued, including
188,372 Common Shares to be issued to certain non-executive members
of the Board in lieu of CHT's obligations to pay fees earned
pursuant to their respective terms of appointment, such that a
total number of Common Shares outstanding at the closing shall be
92,081,632 Common Shares.
16. Cancellation of admission to trading on AIM and re-registration
Prior to the Acquisition becoming Effective, an application will
be made to the London Stock Exchange for the admission of the
Common Shares to trading on AIM to be cancelled on the first
Business Day following the Effective Date. The last day of dealings
in, and for registration of transfers of, Common Shares is expected
to be the close of business on the Business Day before the
Effective Date. No transfers of Common Shares will be registered
after this date.
It is intended that the cancellation of admission of the Common
Shares to trading on AIM will take effect on the first Business Day
following the Effective Date. In addition, entitlements to
depositary interests held within the CREST system will be cancelled
and share certificates in respect of the Common Shares will cease
to be valid and should, if so requested by CHT, be sent to CHT for
cancellation.
17. Overseas Shareholders
The ability of Overseas Shareholders to participate in the
Acquisition and the distribution of this announcement in, into or
from jurisdictions other than the United Kingdom may be restricted
by the laws of those jurisdictions and therefore persons into whose
possession this announcement comes should inform themselves of, and
observe, any such restrictions. Any person (including without
limitation, nominees, trustees and custodians) who would, or
otherwise intends to, forward this announcement, the Proxy
Statement, the Form of Proxy or any accompanying document to any
jurisdiction outside the United Kingdom should refrain from doing
so and seek appropriate professional advice before taking any
action. If any Overseas Shareholder remains in any doubt, it should
consult an appropriate independent professional adviser in its
relevant jurisdiction without delay. In particular, the ability of
persons who are not resident in the United Kingdom to vote their
Common Shares at the General Meeting or to execute and deliver a
Form of Proxy appointing another to vote their Common Shares in
respect of the General Meeting on their behalf, may be affected by
the laws of the relevant jurisdiction in which they are located.
Further details in relation to Overseas Shareholders will be
contained in the Proxy Statement.
Enquiries:
CC Capital Management, LLC
Doug Newton newton@cc.capital
Finsbury - PR adviser to CC Capital
Charles O'Brien (UK) Tel: +44 20 7251 3801
charles.obrien@finsbury.com
Kal Goldberg (US) Tel: +1 646 805 2005
kal.goldberg@finsbury.com
Chris Ryall (U.S.) Tel: +1 646 805 2078
chris.ryall@finsbury.com
Constellation Healthcare Technologies, Inc.
Paul Parmar, Chief Executive Officer c/o Redleaf Communications
Sotirios ("Sam") Zaharis, Chief Financial Officer Tel: +44 20 7382 4730
finnCap Tel: +44 (0) 20 7220 0500
Stuart Andrews / Julian Blunt / Scott Mathieson Corporate Finance
Simon Johnson Corporate Broking
Redleaf Communications - PR adviser to CHT Tel: +44 (0)20 7382 4730
Charlie Geller / Sam Modlin constellation@redleafpr.com
Important Notices:
Disclaimers
finnCap, which is authorised and regulated in the UK by the
Financial Conduct Authority is acting exclusively for CHT and no
one else in connection with the matters set out in this
announcement. In connection with such matters, finnCap will not
regard any other person as their client, nor will they be
responsible to any other person for providing the protections
afforded to clients of finnCap or for providing advice in relation
any matter referred to herein.
This announcement is for information purposes only and is not
intended to, and does not constitute, or form part of any offer,
invitation, inducement or the solicitation of an offer to purchase,
otherwise acquire, subscribe for, sell or otherwise dispose of or
exercise rights in respect of any securities or the solicitation of
any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise. Any vote, decision in respect of, or
other response to, the Acquisition should be made only on the basis
of the information contained in the Proxy Statement. Each CHT
Shareholder is urged to consult its independent professional
advisers immediately regarding the tax consequences of the
Acquisition applicable to them.
In accordance with normal practice in the United Kingdom, the
Parent or its nominees, or its brokers (acting as agents), may from
time to time make certain purchases of, or arrangements to
purchase, Common Shares, other than pursuant to the Acquisition,
until the date on which the Acquisition becomes Effective, lapses
or is otherwise withdrawn. These purchases may occur either in the
open market at prevailing prices or in private transactions at
negotiated prices. Any information about such purchases will be
disclosed as required in the United Kingdom, will be reported to a
Regulatory Information Service and will be available on the London
Stock Exchange website at www.londonstockexchange.com.
Overseas Shareholders
The ability of Overseas Shareholders to participate in the
Acquisition and the distribution of this announcement in, into or
from jurisdictions other than the United Kingdom may be restricted
by the laws of those jurisdictions and therefore persons into whose
possession this announcement comes should inform themselves of, and
observe, any such restrictions. Any person (including without
limitation, nominees, trustees and custodians) who would, or
otherwise intends to, forward this announcement, the Proxy
Statement, the Form of Proxy or any accompanying document to any
jurisdiction outside the United Kingdom should refrain from doing
so and seek appropriate professional advice before taking any
action. If any Overseas Shareholder remains in any doubt, it should
consult an appropriate independent professional adviser in its
relevant jurisdiction without delay. In particular, the ability of
persons who are not resident in the United Kingdom to vote their
Common Shares at the General Meeting or to execute and deliver a
Form of Proxy appointing another to vote their Common Shares in
respect of the General Meeting on their behalf, may be affected by
the laws of the relevant jurisdiction in which they are
located.
Failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any person.
This announcement has been prepared for the purposes of complying
with the AIM Rules for Companies and the laws of England and Wales
and the information disclosed may not be the same as that which
would have been disclosed if this document and the accompanying
documents had been prepared in accordance with the laws of other
jurisdictions. In particular, the Acquisition is not governed by
the Takeover Code and CHT Shareholders will not be afforded the
protection of the Takeover Code.
This announcement is not intended to, and does not, constitute
or form part of any offer or invitation to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of, any
securities or the solicitation of any vote or approval pursuant to
the Acquisition or otherwise, in any jurisdiction in which such
offer, invitation or solicitation is unlawful.
Forward-Looking Statements
This announcement contains statements about CHT, Parent and Sub
that are or may be forward-looking statements which are prospective
in nature. All statements other than statements of historical facts
may be forward-looking statements. Often, but not always,
forward-looking statements can be identified by the use of
forward-looking words such as "targets", "plans", "believes",
"expects", "aims", "intends", "will", "should", "could", "would",
"may", "anticipates", "estimates", "synergy", "cost-saving",
"projects", "goal" or "strategy" or, words or terms of similar
substance or the negative thereof. Forward-looking statements may
include statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy,
losses and future prospects; (ii) business and management
strategies and the expansion and growth of CHT's and Parent's
operations and potential synergies resulting from the Acquisition;
and (iii) the effects of government regulation on CHT's and
Parent's business.
These forward-looking statements are not guarantees of future
performance. Such forward-looking statements involve known and
unknown risks and uncertainties that could significantly affect
expected results and are based on certain key assumptions. Many
factors could cause actual results to differ materially from those
projected or implied in any forward-looking statements. Due to such
uncertainties and risks, readers are cautioned not to place undue
reliance on such forward-looking statements, which speak only as of
the date of this announcement. All subsequent oral or written
forward-looking statements attributable to CHT and Parent or any of
their respective members, directors, officers or employees or any
persons acting on their behalf are expressly qualified in their
entirety by the cautionary statement above. CHT and Parent disclaim
any obligation to update any forward-looking or other statements
contained in this announcement, except as required by applicable
law.
No Profit Forecasts or Estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for CHT or Parent, as appropriate, for the
current or future financial years would necessarily match or exceed
the historical published earnings or earnings per share for CHT or
Parent, as appropriate.
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them.
Exchange Rates
The Acquisition Price is fixed in USD and the risk of
fluctuations of the Sterling equivalent at closing will be borne by
CHT Shareholders. Amounts not denominated in Sterling in this
announcement have been converted into Sterling at the prevailing
exchange rate as quoted from Bloomberg at the close of business in
London on the relevant date.
APPIX
DEFINITIONS
The following definitions apply throughout this announcement
unless the context requires otherwise.
"Acquired Corporations" (a) the Company; (b) each of the
Company's subsidiaries; and (c) any other Entity that has been
merged with or into, or that is a predecessor to, any of the
Entities identified in paragraphs (a) or (b) above;
"Acquisition" the recommended acquisition of the entire issued
and to be issued ordinary share capital of CHT by the Parent
through the Sub at the Acquisition Price in cash and Promissory
Notes to be effected by means of the Merger Agreement and, where
the context admits, any subsequent variation, revision, extension
or renewal thereof;
"Acquisition Price" $2.93 in cash and $0.43 in Promissory Notes
per share;
"Acquisition Proposal" any inquiry, indication of interest,
proposal or offer made by any Person (other than Parent or any of
its Affiliates) contemplating or otherwise relating to any
Acquisition Transaction;
"Acquisition Transaction" any transaction or series of related
transactions involving: (a) any merger, exchange, consolidation,
business combination, plan of arrangement, issuance of securities,
acquisition of securities, reorganization, recapitalization,
takeover offer, tender offer, exchange offer or other similar
transaction: (i) in which a Person or "group" (as defined in the
Exchange Act) of Persons directly or indirectly acquires beneficial
or record ownership of securities representing more than 50.1% of
the outstanding securities of any class of voting securities of any
of the Acquired Corporations whose assets, individually or in the
aggregate, constitute 50.1% or more of the consolidated assets of
the Company (as determined on a book value basis); or (ii) in which
any of the Acquired Corporations whose assets, individually or in
the aggregate, constitute 50.1% or more of the consolidated assets
of the Company (as determined on a book value basis) issues
securities representing more than 50.1% of the outstanding
securities of any class of any Acquired Corporation's voting
securities; (b) any sale, lease, exchange, transfer, license or
disposition of any business or businesses or assets that constitute
or account for 50.1% or more of the consolidated net revenues,
consolidated net income or consolidated assets of the Acquired
Corporations taken as a whole; or (c) any liquidation or
dissolution of any of the Acquired Corporations whose assets,
individually or in the aggregate, constitute 50.1% or more of the
consolidated assets of the Company (as determined on a book value
basis);
"Affiliate" has the meaning given to such term in Rule 12b-2
under the Exchange Act; provided that (a) neither Parent, Sub nor
any other member of the Purchaser Group shall be deemed to be
Affiliates of any Acquired Corporation and (b) no Acquired
Corporation shall be deemed to be an Affiliate of Parent, Sub or
any other member of the Purchaser Group for any purpose;
"AIM" the market of that name operated by the London Stock
Exchange;
"AIM Rules" the AIM Rules for Companies published by the London
Stock Exchange, as amended from time to time;
"Board" the board of directors of CHT;
"Business Day" a day (other than Saturdays, Sundays and public
holidays) on which banks are open for business in London;
"CC Capital" CC Capital Management, LLC;
"Change in Recommendation" any of the following by Company, the
Board or any committee thereof: (i) withhold, withdraw, amend,
qualify or modify, in a manner adverse to Parent or Sub, or propose
publicly to withhold, withdraw, amend, qualify or modify, in a
manner adverse to Parent or Sub, the Company Recommendation, (ii)
adopt, approve or recommend, or publicly propose to adopt, approve
or recommend, or publicly take a neutral position or no position
with respect to, any Acquisition Proposal, (iii) fail to include
the Company Recommendation in the Proxy Statement or (iv) following
receipt of an Acquisition Proposal, fail to reaffirm its approval
or recommendation of the Merger Agreement and the Acquisition
within five (5) Business Days after receipt of any reasonable
request to do so from Parent;
"CHT" or "Company" Constellation Healthcare Technologies, Inc, a
Delaware Corporation;
"CHT Shareholders" or "Shareholders" the holders of Common Shares;
"Closing Price" the middle market price of a Common Share at the
close of business on the day to which such price relates, as
derived from the AIM Appendix to the Daily Official List of the
London Stock Exchange for that day or from Bloomberg in the case of
the average Closing Price for the three month period ended on 12
October 2016;
"Common Share" share of common stock, par value $0.0001 per
share, of the Company;
"Company Expense Reimbursement" the reimbursement of the CC
Capital's reasonable expenses in the event the Parent terminates
the Acquisition due to breach of Company representations up to a
maximum cap of $4 million;
"Company Material Adverse Effect" any Effect that, considered
together with all other Effects, has had or would reasonably be
expected to have or result in a material adverse effect on: (a) the
business, condition (financial or otherwise), prospects,
operations, assets or financial performance of the Acquired
Corporations taken as a whole, other than any such Effect resulting
from (i) any decrease in the market price of the Common Share (but
not any Effect underlying such decrease to the extent that such
Effect would otherwise constitute a Company Material Adverse
Effect), (ii) conditions generally affecting the economy or
financial markets generally or the industry in which the Acquired
Corporations operate, (iii) any Effect resulting from the
announcement or pendency of this Agreement or the Contemplated
Transactions, (iv) changes in Law or GAAP or principles,
interpretations or enforcement thereof, (v) the occurrence,
escalation, outbreak or worsening of any acts of war, armed
hostilities, sabotage or terrorism (including cyber-terrorism or
cyber-attacks) threatened or underway as of the date of this
Agreement, (vi) the existence, occurrence or continuation of any
force majeure event, including any earthquakes, floods, hurricanes,
tropical storms, fires or other national disasters, (vii) any
action taken or not taken by the Company or any of its
Subsidiaries, in each case that is specifically required by this
Agreement, or (viii) any action taken by or at the explicit written
request of the Purchaser Group; provided that any Effect resulting
from any of the matters described in sub-paragraph "(ii)", "(iv)",
"(v)" or "(vi)" may be taken into account in determining whether or
not there has been, or is reasonably expected to be, a Company
Material Adverse Effect if, but only if, such Effect has a
disproportionate adverse effect (and solely to the extent of such
disproportionate adverse effect) on the Company and its
Subsidiaries, taken as a whole, as compared to other companies in
the industry in which the Company and its Subsidiaries operate,
other than any such Effect resulting from any of the matters
described in the immediately preceding clauses "(vii)" and "(viii),
" or (b) the ability of the Company to consummate the Contemplated
Transactions or to perform any of its covenants or obligations
under this Agreement;
"Company Recommendation" the Company's recommendation that the
Shareholders approve the adoption of the Merger Agreement and the
Acquisition;
"Company Stockholder Approval" affirmative vote of a majority of
the aggregate voting power of the issued and outstanding shares of
Common Shares;
"Competing Proposed Transaction" a proposal or offer from, or
participate or engage in or conduct any discussions or negotiations
with, any Person relating to any inquiry, contact, offer or
proposal, oral, written or otherwise, formal or informal, with
respect to any possible business combination with CHT;
"Contemplated Transactions" the Acquisition and the other
transactions contemplated by the Merger Agreement, and the Voting
Agreements and the transactions contemplated therein;
"Contributing Entities" a person directly or indirectly
contributing Common Shares directly or indirectly beneficially
owned by such Contributing Entity to Parent;
"CREST" a relevant system (as defined in the Regulations) in
respect of which Euroclear UK & Ireland Limited is the Operator
(as defined in the Regulations);
"DGCL" General Corporation Law of the State of Delaware;
"Effect" any effect, event, fact, development, circumstance,
condition or change;
"Effective" in the context of the Acquisition, the Merger
Agreement becoming effective in accordance with the terms of the
Merger Agreement;
"Effective Date" the date on which the Acquisition becomes
Effective in accordance with its terms;
"Entity" any corporation (including any non-profit corporation),
general partnership, limited partnership, limited liability
partnership, joint venture, joint venture syndicate, estate, trust,
company (including any company limited by shares, limited liability
company or joint stock company), firm, society or other enterprise,
association, organisation or entity;
"Exchange Act" the Securities Exchange Act of 1934, as amended;
"Financial Conduct Authority" the UK Financial Conduct Authority
or its successor from time to time;
"Financing" financing of the Acquisition;
"finnCap" finnCap Ltd, the nominated adviser and broker to CHT
for the purposes of the AIM Rules;
"Form of Proxy" the form of proxy for use at the General Meeting;
"General Meeting" the general meeting of CHT Shareholders (and
any adjournment thereof) to be convened in connection with the
Acquisition;
"Go-Shop Period" the period from the date of the Merger
Agreement until 25 December 2016;
"Governmental Entity" any: (a) nation, state, commonwealth,
province, territory, county, municipality, tribal territory,
district or other jurisdiction of any nature; (b) U.S. federal,
state, local or municipal, non-U.S. or other government; (c)
governmental or quasi-governmental authority of any nature
(including any governmental division, department, agency,
commission, instrumentality, official, ministry, fund, foundation,
center, organization, unit, body or Entity and any court or other
tribunal); (d) self-regulatory organization (including the London
Stock Exchange and the FCA); or (e) any government healthcare
program contractor;
"HSR" the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended;
"London Stock Exchange" London Stock Exchange Group plc, a
public limited company incorporated in England and Wales with
registered number 5369106;
"Majority of the Minority Approval" the holders of the majority
of outstanding Common Shares, other than those Common Shares held
by an "officer" of the Company (as defined in Rule 16a-1(f)
promulgated under the Exchange Act) and the Parmar Controlled
Entities voting in favour of the adoption of the Merger
Agreement;
"Offer" the non-binding offer proposing terms of the Acquisition
made to the Company on behalf of Parent on 13 October 2016;
"Orion" Orion Healthcorp, Inc. (a wholly owned subsidiary of
CHT);
"Outside Date" 15 February 2017;
"Overseas Shareholders" CHT Shareholders (or nominees,
custodians or trustees of CHT Shareholders) who are resident in, or
nationals or citizens of jurisdictions outside of the UK or who are
citizens or residents of countries other than the UK;
"Panel" or "Takeover Panel" the UK Panel on Takeovers and Mergers;
"Parent" CHT Holdco, LLC, a Delaware Corporation;
"Parent Expense Reimbursement" reimbursement by the Parent to
the Company if the Company terminates the Acquisition due to a
non-intentional breach of Parent or Sub representations;
"Parmar Controlled Entity" entities managed, whether directly or
indirectly, by Paul Parmar and Sam Zaharis namely PBPP Partners
LLC, MYMSMD LLC, PPSR Partners LLC, Blue Mountain Healthcare LLC,
and Parent (formerly FUH and CH prior to their contribution
described in paragraph 11 above), which together are interested in
49,302,598 Common Shares representing 53.5 per cent. of the issued
and outstanding Common Shares at closing of the Acquisition;
"Person" or "Persons" any individual, person (including a
"person" as defined in Section 13(d)(3) of the Exchange Act),
Entity or Governmental Entity;
"Pre-Closing Period" the period between the date of this
announcement and the date of closing of the Acquisition;
"Proceeding" any threatened or pending claim, action, suit,
proceeding or investigation, whether civil, criminal,
administrative or investigative, and whether formal or
informal;
"Promissory Notes" the promissory notes forming part of the
Acquisition Price, the terms of which are further described in
paragraph 11 above;
"Proxy Statement" the document to be sent to CHT Shareholders in
connection with seeking the adoption of the Merger Agreement,
containing and setting out the terms of the Acquisition and the
notice convening the General Meeting;
"Purchaser Group" Parent, Sub, Paul Parmar, each Contributing
Entity and CC Capital;
"Regulations" the Uncertificated Securities Regulations 2001
(SI2001 No. 3755), as amended from time to time;
"Regulatory Information Service" a service approved by the
London Stock Exchange for the distribution to the public of
announcements and included on the list maintained on the London
Stock Exchange's website;
"Resolution" the resolution to be proposed at the General
Meeting to approve the Merger Agreement in connection with the
Acquisition;
"Reverse Termination Fee" each of the Tier 1 Reverse Termination
Fee and the Tier 2 Reverse Termination Fee;
"Special Committee all of the members of the Board save for Mark
Feuer, Paul Parmar and Sam Zaharis;
"Sub" CHT Merger Sub, Inc, a Delaware corporation;
"Superior Proposal Determination" an unsolicited bona fide
written Acquisition Proposal that: (a) did not result from a breach
of the Acquisition Proposal terms; (b) is not subject to a
financing contingency and in respect of which any required
financing is then committed; (c) includes merger consideration in
excess of the aggregate Acquisition Price pursuant to the terms of
the Merger Agreement; and (d) is determined by the Board or any
independent committee, in its good faith judgment, and after taking
into account, among other things, all legal, financial, regulatory
and other aspects of the offer, including any conditions, and the
identity of the offeror and the likelihood and anticipated timing
of consummation, to be more favourable from a financial point of
view to the holders of the Common Shares not held by members of the
Purchaser Group than the Contemplated Transactions;
"Surviving Corporation" the Company, following the Sub having
merged with and into the Company and the separate corporate
existence of Sub shall ceasing thereupon, being the surviving
corporation in the Merger and continuing to be governed by the laws
of the State of Delaware;
"Takeover Code" or "Code" the UK City Code on Takeovers and Mergers;
"Termination Fee" each of the Tier 1 Termination Fee, Tier 2
Termination Fee and the Tier 3 Termination Fee;
"Tier 1 Reverse Termination Fee" payment of $10,000,000 by CC Capital to the Company;
"Tier 2 Reverse Termination Fee" payment of $16,100,000 by the Parent to the Company;
"Tier 1 Termination Fee" payment of $8,000,000 by the Company to CC Capital;
"Tier 2 Termination Fee" payment of $10,000,000 by the Company to CC Capital;
"Tier 3 Termination Fee" payment of $16,100,000 by the Company to CC Capital;
"United Kingdom" or "UK" the United Kingdom of Great Britain and
Northern Ireland;
"United States" or "US" the United States of America, its
territories and possessions, any state of the United States of
America and the District of Columbia and all other areas subject to
its jurisdiction;
"Voting Agreement" either a voting and support agreement
(including a waiver and release of claims) to approve the Merger
governed by the laws of the State of Delaware or a form of
irrevocable commitment to vote in favour of the Merger governed by
English law, both in substantially the form set out in the Merger
Agreement; and
"$" or "USD" the lawful currency of the United States of
America.
References to an enactment include references to that enactment
as amended, replaced, consolidated or re-enacted by or under any
other enactment before or after the date of this announcement.
All the times referred to in this announcement are London times
unless otherwise stated.
References to the singular include the plural and vice
versa.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCFEWSMIFMSESF
(END) Dow Jones Newswires
November 25, 2016 02:00 ET (07:00 GMT)
Constellation Healthcare (LSE:CHT)
Historical Stock Chart
From Apr 2024 to May 2024
Constellation Healthcare (LSE:CHT)
Historical Stock Chart
From May 2023 to May 2024