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UNITED STATES
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): September 17, 2010 (September 17, 2010)
VALEANT PHARMACEUTICALS INTERNATIONAL
(Exact name of registrant as specified in its charter)
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Delaware
(State or Other
Jurisdiction of
Incorporation)
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1-11397
(Commission File Number)
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33-0628076
(IRS Employer
Identification
Number) |
One Enterprise
Alisa Viejo, California 92656
(Address of principal executive offices, including zip code)
(949) 461-6000
(Registrants telephone number, including area code)
N/A
(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):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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This Current Report on Form 8-K is being filed pursuant to a memorandum of understanding
regarding the settlement of certain litigation relating to the Agreement and Plan of Merger, dated
as of June 20, 2010, entered into among Valeant Pharmaceuticals International, a Delaware
corporation (Valeant), Biovail Corporation, a Canadian corporation (Biovail), Biovail Americas
Corp., a Delaware corporation and a wholly owned subsidiary of Biovail (BAC), and Beach Merger
Corp., a Delaware corporation and a newly formed, wholly owned subsidiary of BAC (Merger Sub)
(the Merger Agreement), pursuant to which Merger Sub will merge with and into Valeant, with
Valeant continuing after the Merger as a wholly-owned subsidiary of BAC (the Merger). This Current
Report on Form 8-K supplements disclosures made in the definitive joint proxy statement/prospectus
of Valeant and Biovail (the joint proxy statement/prospectus), previously mailed to shareholders of Valeant and Biovail and filed by
Valeant on August 23, 2010 with the Securities and Exchange Commission (SEC).
On July 16, 2010, July 21, 2010, and July 22, 2010, three putative shareholder class action
complaints were filed in the Court of Chancery of the State of Delaware on behalf of all
stockholders of Valeant (other than defendants) challenging the proposed Merger. On August 2, 2010,
the Court of Chancery granted an order consolidating the three action complaints into a case
captioned In re Valeant Pharmaceuticals International Shareholders Litigation, Consol. C.A. No.
5644 (the Delaware Action). On August 3, 2010, the Court of Chancery entered an order which,
among other things, conditionally certified the Delaware Action as a class action.
On September 17, 2010, the parties to the Delaware Action executed a memorandum of
understanding (the MOU) containing the terms for the parties agreement in principle to resolve
the Delaware Action. The settlement contemplated by the MOU will be submitted to the Delaware court for approval.
As part of the settlement, the defendants deny all allegations of wrongdoing and deny that the disclosures in the joint proxy/statement
prospectus were inadequate but have agreed to provide supplemental disclosures. The settlement will not affect the timing of the Merger or
the amount of consideration to be paid in the Merger. Under the terms of the MOU, Valeant and Biovail are making the following disclosures:
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As previously disclosed on pages 88-90 of the joint proxy statement/prospectus, Valeants management
prepared and provided to Biovail, as well as to Morgan Stanley & Co. Incorporated,
Goldman, Sachs & Co. and Jefferies & Company, Inc. in connection with their
respective evaluation of the fairness of the merger consideration, non-public,
internal financial forecasts regarding Valeants projected future operations for
the 2010 through 2014 fiscal years. In those forecasts, stock based compensation
expense was treated as a cash expense for purposes of determining EBIT. |
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Furthermore, as previously disclosed on page 87 of the joint proxy
statement/prospectus, Jefferies & Company, Inc. used Valeants managements
projected EBIT in determining unlevered free cash flow for purposes of its
discounted cash flow analysis conducted in connection with its opinion described on
pages 81-88 of the joint proxy statement/prospectus. |
Caution Regarding Forward-Looking Information and Safe Harbor Statement
To the extent any statements made in this document contain information that is not historical,
these statements are forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
may be forward-looking information as defined under applicable Canadian securities legislation
(collectively, forward-looking statements).
These forward-looking statements relate to, among other things, the expected benefits of the
proposed merger such as efficiencies, cost savings, tax benefits, enhanced revenues and cash flow,
growth potential,
market profile and financial strength; the competitive ability and position of the combined
company; the expected timing of the completion of the transaction; and the expected payment of a
one-time cash dividend. Forward-looking statements can generally be identified by the use of words
such as believe, anticipate, expect, estimate, intend, continue, plan, project,
will, may, should, could, would, target, potential and other similar expressions. In
addition, any statements that refer to expectations, projections or other characterizations of
future events or circumstances are forward-looking statements. Although certain of these
statements set out herein are indicated above, all of the statements in this filing that contain
forward-looking statements are qualified by these cautionary statements. Although Valeant and
Biovail believe that the expectations reflected in such forward-looking statements are reasonable,
such statements involve risks and uncertainties, and undue reliance should not be placed on such
statements. Certain material factors or assumptions are applied in making forward-looking
statements, including, but not limited to, factors and assumptions regarding the items outlined
above. Actual results may differ materially from those expressed or implied in such statements.
Important factors that could cause actual results to differ materially from these expectations
include, among other things, the following: the failure to receive, on a timely basis or otherwise,
the required approvals by Valeant and Biovail shareholders and government or regulatory agencies
(including the terms of such approvals); the risk that a condition to closing of the merger may not
be satisfied; the possibility that the anticipated benefits and synergies from the proposed merger
cannot be fully realized or may take longer to realize than expected; the possibility that costs or
difficulties related to the integration of Valeant and Biovail operations will be greater than
expected; the ability of the combined company to retain and hire key personnel and maintain
relationships with customers, suppliers or other business partners; the impact of legislative,
regulatory, competitive and technological changes; the risk that the credit ratings of the combined
company may be different from what the companies expect; and other risk factors relating to the
pharmaceutical industry, as detailed from time to time in each of Valeants and Biovails reports
filed with the Securities and Exchange Commission (SEC) and, in Biovails case, the Canadian
Securities Administrators (CSA). There can be no assurance that the proposed merger will in fact
be consummated.
Additional information about these factors and about the material factors or assumptions underlying
such forward-looking statements may be found in the body of this filing, as well as under Item 1.A.
in each of Valeants and Biovails Annual Report on Form 10-K for the fiscal year ended December
31, 2009, and Item 1.A in each of Valeants and Biovails most recent Quarterly Report on Form 10-Q
for the quarterly period ended June 30, 2010. Valeant and Biovail caution that the foregoing list
of important factors that may affect future results is not exhaustive. When relying on
forward-looking statements to make decisions with respect to Valeant and Biovail, investors and
others should carefully consider the foregoing factors and other uncertainties and potential
events. Neither Biovail nor Valeant undertakes any obligation to update or revise any
forward-looking statement, except as may be required by law.
Additional Information
In connection with the proposed merger, Biovail has filed with the SEC a Registration Statement on
Form S-4 that includes a definitive joint proxy statement of Valeant and Biovail that also
constitutes a prospectus of Biovail, and each of Valeant and Biovail may file with the SEC other
documents regarding the proposed merger. The definitive joint proxy statement/prospectus was first
mailed to shareholders of Valeant and Biovail on or about August 20, 2010. INVESTORS ARE URGED TO
READ THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC IN
CONNECTION WITH THE PROPOSED MERGER CAREFULLY IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors may obtain the joint proxy
statement/prospectus, as well as other filings containing information about Valeant and Biovail,
free of charge, at the website maintained by the SEC at
www.sec.gov and, in Biovails case, on SEDAR at www.sedar.com. Investors may also obtain these
documents, free of charge, from Valeants website (www.valeant.com) under the tab Investor
Relations and then under the heading SEC Filings, or by directing a request to Valeant, One
Enterprise, Aliso Viejo, California, 92656, Attention: Corporate Secretary. Investors may also
obtain these documents, free of charge, from Biovails website (www.biovail.com) under the tab
Investor Relations and then under the heading Regulatory Filings and then under the item
Current SEC Filings, or by directing a request to Biovail, 7150 Mississauga Road, Mississauga,
Ontario, Canada, L5N 8M5, Attention: Corporate Secretary.
The respective directors and executive officers of Valeant and Biovail and other persons may be
deemed to be participants in the solicitation of proxies in respect of the proposed transaction.
Information regarding Valeants directors and executive officers is available in its Annual Report
on Form 10-K for the fiscal year ended December 31, 2009, which was filed with the SEC on February
24, 2010, and in its definitive proxy statement filed with the SEC by Valeant on March 25, 2010.
Information regarding Biovails directors and executive officers is available in its Annual Report
on Form 10-K for the fiscal year ended December 31, 2009, which was filed with the SEC on February
26, 2010, and in its definitive proxy statement filed with the SEC and CSA by Biovail on April 21,
2010. Other information regarding the participants in the proxy solicitation and a description of
their direct and indirect interests, by security holdings or otherwise, is contained in the
definitive joint proxy statement/prospectus and other relevant materials filed with the SEC. These
documents can be obtained free of charge from the sources indicated above. This communication shall
not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an
offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities shall be made except by means of
a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
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 hereunto duly authorized.
Date: September 17, 2010
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By: |
/s/ Steve T. Min
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Name: |
Steve T. Min |
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Title: |
Executive Vice President and General Counsel |
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