Health Systems Solutions Enters into Agreement to Acquire Emageon to Create Healthcare Technology Leader
14 October 2008 - 9:30AM
PR Newswire (US)
Principal Shareholder Shows Continuing Commitment by Financing All
Cash Transaction Expected to Improve Speed-to-Market for Next
Generation Enterprise PACS NEW YORK and BIRMINGHAM, Ala., Oct. 13
/PRNewswire-FirstCall/ -- Health Systems Solutions, Inc. (OTC:HSSO)
(BULLETIN BOARD: HSSO) and Emageon Inc. (NASDAQ: EMAG) today
announced the signing of a definitive agreement for HSS to acquire
100% of the stock of Emageon. The agreement was unanimously
approved by their respective boards of directors as well as the
Strategic Alternatives Committee of Emageon. Under the terms of the
agreement, HSS will acquire all outstanding shares of Emageon
common stock for $2.85 a share, in an all cash transaction of
approximately $62 million. The price represents approximately a 37%
premium on Emageon's share price as of market close on Monday,
October 13, 2008. The consideration for the purchase is being
financed by a facility of $85 million provided by Stanford
International Bank Ltd, a member of the Stanford Financial Group
and HSS' principal shareholder. The additional funds will be used
for working capital and to fund growth initiatives. The financing
will take the form of 6% Convertible Secured Debentures due 2013
with warrants to purchase up to 9 million shares of common stock.
"This transaction allows HSS to reach critical scale and positions
us well for future growth. Our acquisition strategy is based upon
using Emageon as our platform acquisition that will enable us to
realize synergies from future acquisitions," said Stan Vashovsky,
HSS' Chairman and CEO. "This transaction will offer us the ability
to leverage Emageon's best-in-market products as well as broaden
and strengthen our management team with some of the industry's most
respected leaders. Our ability to bring together innovators in
healthcare technology and unleash their entrepreneurial and
creative talents will result in cutting-edge solutions that will
improve clinical care and significantly improve customer
profitability." A factor in the timing of this combination is the
desire to accelerate the delivery of next generation Picture
Archiving and Communication Systems (PACS), a category in which
Emageon is a recognized leader. Earlier this year the company
received the "Best in KLAS" award for Cardiology PACS* from KLAS,
an independent research firm focused on healthcare IT. "Emageon's
network of loyal customers, which includes some of the largest
hospital networks in North America, will benefit meaningfully as a
result of our becoming a part of HSS," said Chuck Jett, Emageon's
CEO & President. "HSS will be able to augment Emageon's
technological capabilities as the industry moves to the start of
the PACS replacement cycle in early 2009. All of us at Emageon
believe this strategic combination with HSS will enable faster
speed- to-market of next generation systems that will offer an even
higher level of stability and performance." The melding of the
organizations will result in a company of approximately 400
employees. Current Emageon management will continue to operate the
business as they have, but as a part of the HSS group of companies.
Further, sales and support functions of both organizations will be
maintained, affording no disruption in the manner that customers
work with them. Financial advisors for this agreement were Stanford
Group Company for HSS and Jefferies & Company and Sun Trust
Robinson Humphrey for Emageon. Legal counsel was provided to HSS by
Olshan, Grundman, Frome, Rosenzweig & Wolosky LLP and to the
Strategic Alternatives Committee of Emageon's Board of Directors by
Bass, Berry & Sims, PLC. The transaction is subject to approval
of a majority of Emageon's stockholders, as well as certain
customary closing conditions. Emageon's board of directors
recommends that Emageon's stockholders approve the transaction.
Oliver Press Partners, LLC, which owns approximately 16.6% of
Emageon's voting stock, and all officers and directors of Emageon
have entered into a voting agreement to vote for the approval of
the transaction. A special meeting of Emageon's stockholders will
be held as soon as reasonably practicable to consider the
transaction. Until the transaction closes, each company will
continue to operate independently. Following the closing, HSS
anticipates applying for listing on the NASDAQ. Each of the Parties
will file with the Securities and Exchange Commission a Current
Report on Form 8-K containing additional information concerning the
transaction. About Health Systems Solutions HSS is a technology and
services company dedicated to bringing innovation to the health
care industry. HSS' objective is to leverage current and next-
generation technologies to offer value-added products and services
which will generate improved clinical, operational and financial
outcomes for our clients. The HSS portfolio of products and
services extends across many segments of health care including home
health care, medical staffing, acute and post-acute facilities, and
telehealth/telemedicine, grouped into three segments: technology
solutions, software and consulting. For more information, please
visit http://www.hssglobal.com/. About Emageon Emageon provides
information technology systems for hospitals, healthcare networks
and imaging facilities. Its enterprise family of solutions includes
RadSuite(TM), HeartSuite(TM) and other specialty suites. All
Emageon solutions are built on a unified Enterprise Content
Management system offering advanced visualization and
infrastructure tools for the clinical analysis and management of
digital medical images, reports and associated clinical content.
Emageon's standards-based solutions are designed to help customers
enhance patient care, automate workflow, lower costs, improve
productivity and provide better service to physicians. For more
information, please visit http://www.emageon.com/. About Stanford
Financial Group Stanford Financial Group is a privately held global
network of independent, affiliated financial services companies.
Stanford's core businesses are private wealth management and
investment banking for institutions and emerging growth companies.
The Stanford Financial Group of companies provides private and
institutional investors with global expertise in asset allocation
strategies, investment advisory services, award-winning policy and
equity research, international private banking and trust
administration, commercial banking, investment banking, merchant
banking, institutional sales and trading, real estate investment
and insurance. Stanford has over $50 billion in assets under
management or advisement. Securities products and services are
offered in the United States by Stanford Group Company, member
FINRA/SIPC. Stanford Financial Group is not a legal entity, but a
registered trademark that encompasses the global network of
independent, but affiliated, privately held and wholly owned
entities. More information on the company can be found at
http://www.stanfordfinancial.com/. Cautionary Note Regarding
Forward-looking Statements: Information in this press release that
involves the expectations, plans, intentions or strategies of
Health Systems Solutions, Inc. ("HSS") and Emageon Inc. ("Emageon"
and together with HSS, the "Parties") regarding the future are
forward-looking statements that are not facts and involve a number
of risks and uncertainties. In this release, they are identified by
references to dates after the date of this release and words such
as "will," "remains," "to be," "plans," "believes," "may,"
"expects," "intends," and similar expressions. Factors that could
cause the Parties' actual future results to differ materially from
those expressed in the forward-looking statements set forth in this
release include, but are not limited to, the timing and successful
completion of HSS' acquisition of Emageon (the "Acquisition"), HSS'
success in integrating the operations of Emageon in a timely
manner, or at all and HSS' ability to realize the anticipated
benefits of the transaction to the extent, or in the timeframe,
anticipated. Other such factors include any additional risk factors
identified in the Parties' respective annual reports on Form 10-K
for the fiscal year ended December 31, 2007, as amended, and the
Parties' subsequent quarterly reports on Form 10-Q. The
forward-looking statements in this release are based upon
information available to the Parties as of the date of this
release, and the Parties assume no obligation to update any such
forward-looking statements. Forward-looking statements believed to
be true when made may ultimately prove to be incorrect. These
statements are not guarantees of future performance and are subject
to risks, uncertainties and other factors, some of which are beyond
our control and may cause actual results to differ materially from
our current expectations. IMPORTANT ADDITIONAL INFORMATION WILL BE
FILED WITH THE SEC EMAGEON INTENDS TO FILE A PRELIMINARY PROXY
STATEMENT WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION (THE
"SEC") IN CONNECTION WITH THE ACQUISITION AND TO MAIL A DEFINITIVE
PROXY STATEMENT AND OTHER RELEVANT DOCUMENTS TO EMAGEON'S
SHAREHOLDERS. SHAREHOLDERS OF EMAGEON ARE ADVISED TO READ, WHEN
AVAILABLE, EMAGEON'S PRELIMINARY PROXY STATEMENT, INCLUDING ANY
AMENDMENTS THERETO, AND DEFINITIVE PROXY STATEMENT IN CONNECTION
WITH EMAGEON'S SOLICITATION OF PROXIES FOR THE SHAREHOLDER MEETING
TO BE HELD TO APPROVE THE ACQUISITION BECAUSE THE PROXY STATEMENTS
WILL CONTAIN IMPORTANT INFORMATION ABOUT EMAGEON, HSS AND THE
ACQUISITION. THE DEFINITIVE PROXY STATEMENT WILL BE MAILED TO
SHAREHOLDERS AS OF A RECORD DATE TO BE ESTABLISHED FOR VOTING ON
THE ACQUISITION. SHAREHOLDERS WILL ALSO BE ABLE TO OBTAIN A COPY OF
THE PROXY STATEMENTS, WITHOUT CHARGE, ONCE AVAILABLE, AT THE SEC'S
INTERNET SITE AT http://www.sec.gov/ OR BY DIRECTING A REQUEST TO:
EMAGEON INC., 1200 CORPORATE DRIVE, SUITE 200, BIRMINGHAM, ALABAMA
35242, ATTN: JOHN WILHOITE. EMAGEON AND ITS DIRECTORS AND OFFICERS
MAY BE DEEMED PARTICIPANTS IN THE SOLICITATION OF PROXIES FROM
EMAGEON'S SHAREHOLDERS. A LIST OF THE NAMES OF THOSE DIRECTORS AND
THE OFFICERS AND DESCRIPTIONS OF THEIR INTERESTS IN EMAGEON IS
CONTAINED IN EMAGEON'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL
YEAR ENDED DECEMBER 31, 2007, AS AMENDED, WHICH IS FILED WITH THE
SEC, AND WILL ALSO BE CONTAINED IN EMAGEON'S PROXY STATEMENTS WHEN
THEY BECOME AVAILABLE. EMAGEON'S SHAREHOLDERS MAY OBTAIN ADDITIONAL
INFORMATION ABOUT THE INTERESTS OF ITS DIRECTORS AND OFFICERS IN
THE ACQUISITION BY READING EMAGEON'S PROXY STATEMENTS WHEN THEY
BECOME AVAILABLE. Health Systems Solutions is a registered
trademark of Health Systems Solutions, Inc. Emageon is a registered
trademark and RadSuite and HeartSuite are trademarks of Emageon
Inc. Other marks belong to their respective owners. *(C) 2008 KLAS
Enterprises, LLC. All rights reserved. DATASOURCE: Health Systems
Solutions, Inc.; Emageon Inc. CONTACT: for Investors: Michael G.
Levine, HSS CFO & EVP, +1-212-798- 9405, , or for Media: Steve
Hoechster (HEX-ster), 5W Public Relations, +1-917-319-8398, , both
for HSS; or for Investors: John Wilhoite, CFO of Emageon,
+1-205-980-9222, , or for Media: Bill Funderburk, Director,
Marketing & Public Relations, +1-205-980-7542, , both of
Emageon Web site: http://www.emageon.com/ http://www.hssglobal.com/
http://www.stanfordfinancial.com/
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