Unassociated Document
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Filed by Galil
Medical Ltd. pursuant to Rule 425 under the Securities Act of 1933, as
amended |
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Subject
Company: Endocare, Inc.
Commission
File No. 001-15063
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This
filing relates to the proposed merger between Galil Medical Ltd. (“Galil”) and
Endocare, Inc. (“Endocare”) pursuant to the terms of an Agreement and Plan of
Merger, dated as of November 10, 2008, as
amended by Amendment No. 1 to Agreement and Plan of Merger, dated as of March
19, 2009, by and among Endocare, Orange Acquisitions Ltd. and
Galil.
Galil intends to provide the following
Notice of Special General Meeting to all of the voting shareholders of Galil on
April 5, 2009:
GALIL
MEDICAL LTD.
PC/51-241014-3
(the
“Company”)
To: All
Holders of Voting Shares of the Company
NOTICE
IS HEREBY GIVEN OF A SPECIAL GENERAL MEETING OF ALL THE VOTING SHAREHOLDERS OF
THE COMPANY AND ANY ADJOURNMENTS THEREOF
You are
hereby informed that a Shareholders Special General Meeting (the “General Meeting”) will be held
at the offices of the Company, Israel, on April 23, 2009, at 17:00 Israel time,
at which attendance is requested in person, by proxy or by other means
acceptable to the Company. The General Meeting will not be held until the Form
S-4 registration statement relating to the Merger Transaction (as defined below)
filed by Endocare, Inc. (“Endocare”) has been declared
effective by the U.S. Securities and Exchange Commission (the “SEC”).
At the
General Meeting you will be requested to vote upon the following proposed
resolutions:
1. PROPOSED RESOLUTION:
Approval of Merger Agreement and Ancillary Documents and
Transactions
WHEREAS, the Company has entered
on November 10, 2008 into an Agreement and Plan of Merger (the “Merger Agreement”) with
Endocare and Orange Acquisitions Ltd., a wholly owned subsidiary of Endocare
(“Merger Sub”), pursuant
to which Merger Sub will merge
with and into the Company, with the Company surviving such merger, following
which the Company will become a wholly owned subsidiary of Endocare, and all of
the Company’s shares and options issued and outstanding immediately prior to the
closing of the merger (the “Closing”) will be exchanged for the right to
receive shares of common stock and options to purchase shares of common stock,
respectively, of Endocare at the Exchange Ratio (as such term is defined under
the Merger Agreement), all in accordance with the terms and subject to the
conditions set forth in the Merger Agreement, a copy of which was filed with the SEC
by Endocare on November 12, 2008 as an exhibit to its current report on Form 8-K
and can be accessed through the website maintained by the SEC at
http://www.sec.gov/edgar/searchedgar/companysearch.html (the “Merger
Transaction”);
and
WHEREAS, in connection with, and subject
to, the Merger Transaction, certain shareholders of the Company and of Endocare
wish to participate in an equity investment in shares of common stock of
Endocare, in accordance with the provisions of a certain Stock Purchase
Agreement, constituting one of the ancillary agreements to the Merger Agreement
(the “Financing
Agreement”);
and
WHEREAS, in connection with the Merger
Agreement, the Company has entered on November 10th, 2008 into (i) a certain Pre-Closing
Shareholders Agreement with certain major shareholders of the Company,
including, inter alia, all the holders of Series A-1 Preferred Shares of the
Company (“Preferred A1
Shares”) and Series A-2
Preferred Shares of the Company (“Preferred A2
Shares”), to be effective
as of immediately prior to the Closing, pursuant to which, subject to the
consummation of the Closing (a) the holders of the Preferred A1 Shares and the
holders of the Preferred A2 Shares agree to an amendment to the Articles
of Association of the Company (the “Articles”) whereupon such
preferred shares shall be automatically converted into Ordinary Shares of the
Company (“Ordinary
Shares”) immediately prior to the Closing, at an agreed upon conversion
ratio and for no consideration (the “Share Conversion”), (b) the
Investor Rights Agreement, dated as of December 8, 2006, among the Company and
certain of its Shareholders shall be terminated, and (c) certain groups of
shareholders of the Company agree on an earn-out mechanism among themselves, as
an inducement to enter into the Merger Transaction, all in accordance with the terms and subject
to the conditions set forth in the Pre-Closing Shareholders Agreement, in the
form attached hereto as Exhibit
A (the “Pre-Closing Shareholders
Agreement”), and (ii) all
other ancillary agreements or documents to the Merger Agreement to which the
Company is a party to, or otherwise bound by, including the Merger Proposal (as
such term is defined under the Merger Agreement) (the “Ancillary
Agreements”);
and
WHEREAS, in order to give effect
to the transactions contemplated by the Pre-Closing Shareholders Agreement,
subject to the consummation of the Merger Transaction and effective as of immediately prior
to the Closing, the Company wishes to amend its Articles to the effect
that (i) a new Article 8.4.2.3 (as set forth below) shall be inserted in order
to implement the Share Conversion; and (ii) the Company’s authorized share capital shall be
increased as required in order to effect the Share Conversion, all as
described below; and
WHEREAS, the Board of Directors
has determined that the Merger Agreement, the Ancillary Agreements, the Merger
Transaction and the other transactions contemplated thereby, are fair to, and in
the best interests of, the Company and its shareholders, and that, considering
the financial position of the merging companies, no reasonable concern exists
that the Company as the surviving entity will be unable to fulfill the
obligations of the Company to its creditors;
RESOLVED, that the execution, delivery and
performance by the Company of the Merger Agreement and the Ancillary Agreements
(together with all exhibits thereto), and the transactions contemplated
thereunder, including the merger of the Merger Sub with and into the
Company, with the Company surviving such
merger, be and hereby are,
approved and authorized by the Shareholders of the Company in all respects
whatsoever;
and
FURTHER RESOLVED, that the execution, delivery and performance
by the Company of the Pre-Closing Shareholders Agreement (together with all exhibits thereto),
and the transactions contemplated thereunder, including the Share Conversion, be
and hereby are, approved and authorized by the Shareholders of the Company in
all respects whatsoever; and
FURTHER RESOLVED, to approve the
amendment of the Articles as follows, all subject to the consummation of
the Merger Transaction and
effective as of immediately prior to the Closing (the “Pre-Closing Articles
Amendment”):
(i)
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A
new Article 8.4.2.3 shall be inserted, which shall
state:
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“Each
outstanding Series A Preferred Share shall automatically be converted, without
the payment of any additional consideration, into fully paid and nonassessable
Ordinary Shares at the conversion rate equal to 3.43 Ordinary Shares per each
Series A Preferred Share of the Company, immediately prior to, and in all cases
subject to, the consummation of the closing of the Change of Control Event (as
defined in Article 8.3.2) approved by the Board of Directors of the Company in
its meeting dated November 9, 2008”.
(ii)
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The
Company’s authorized share capital shall be increased, so that following
such increase the Company’s registered share capital shall be
NIS3,950,089.28, divided into 395,008,924 Ordinary Shares, par value NIS
0.01 per share and 4 Series A-1 Preferred Shares, par value NIS 0.01 per
share.”;
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2. PROPOSED RESOLUTION:
Approval of the Dormant Shares Cancellation
WHEREAS, subject to the consummation of
the Merger Transaction and effective as of immediately prior to the Closing, the
Company wishes that any shares of the Company held in the treasury of the
Company or owned by the Company at such time shall immediately and automatically
be cancelled (the “Dormant Shares
Cancellation”);
RESOLVED, that the Dormant Shares Cancellation, be and hereby is,
approved and authorized by the Shareholders of the Company in all respects
whatsoever; and
3. PROPOSED RESOLUTION:
Approval of the Benefit Packages
WHEREAS,
following discussions held by the Compensation Committee of the Company on
October 1, 2008 and the approval of the Board of Directors as of November 9,
2008, subject to the consummation of the Merger Transaction and effective as of
immediately prior to the Closing, the Company wishes to grant certain of its
senior employees bonus payments and retention packages, up to such amounts and
benefits as described under Exhibit B attached
hereto (the “Benefit Packages”);
RESOLVED, that the grant of the Benefit
Packages be, and hereby is, approved and authorized in all respects whatsoever;
and
4. PROPOSED RESOLUTION:
Approval of Appointment of Proxy
WHEREAS, certain optionees of the
Company, who exercised options into Ordinary Shares pursuant to the provision of
the option plans of the Company, have executed a proxy to vote such shares in
favor of certain former officers of the Company (the “Proxies”), and the Company wishes to designate
and empower Marty Emerson as agent and proxy for the purposes of such
Proxies and any future proxies to be executed by optionees of the Company;
RESOLVED, that the delegation of
the powers under the Proxies to Marty Emerson be, and hereby is, approved and
authorized by the Shareholders of the Company in all respects
whatsoever.
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This
notice does not constitute an offer to sell, or the solicitation of an offer to
buy, any securities and is issued pursuant to Rule 135 under the U.S. Securities
Act of 1933, as amended.
Yours
sincerely,
Galil
Medical Ltd.
Additional Information About
The Merger and Where To Find It
In connection with the proposed merger
with Galil, Endocare has filed a registration statement on Form S-4 (the
“Registration Statement”), which also includes a proxy statement of Endocare,
and other relevant documents concerning the transaction with the U.S. Securities
and Exchange Commission (the “SEC”). STOCKHOLDERS OF GALIL ARE URGED TO READ THE
REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
TRANSACTION.
Investors
will be able to obtain free copies of the Registration Statement and any other
document filed with the SEC by Endocare or Galil through the website maintained
by the SEC at www.sec.gov.
Forward Looking
Statements
Certain matters set forth in this
notice, including statements relating to the merger and the proposed concurrent
financing, and other statements identified by words such as “estimates,”
“expects,” “projects,” “plans,” and similar expressions are forward-looking
statements within the meaning of the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that may cause actual results to differ
materially, including failure to receive approval of the transaction by Endocare
or Galil stockholders, the possibility that the anticipated benefits from the
merger cannot be fully realized, if at all, or may take longer to realize than
expected, the possibility that costs or difficulties related to the integration
of Galil’s operations into Endocare will be greater than expected, the ability
of the combined company to retain and hire key personnel, the impact of
regulatory, competitive and technological changes and other risk factors
relating to our industry. There can be no assurance that the proposed merger
will in fact be consummated. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this notice.
Unless required by law, Galil undertakes no obligation to update any
forward-looking statements, whether as a result of new information, future
events or otherwise.
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