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): DECEMBER 20, 2001
INVERNESS MEDICAL INNOVATIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
DELAWARE 001-16789 04-3565120
---------------------------- ------------------------ -------------------
STATE OR OTHER JURISDICTION (COMMISSION FILE NUMBER) (IRS EMPLOYER
OF INCORPORATION) IDENTIFICATION NO.)
51 SAWYER ROAD, SUITE 200, WALTHAM, MASSACHUSETTS 02453
---------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(781) 647-3900
--------------
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
Certain matters discussed in this Current Report on Form 8-K contain
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. These forward-looking statements include statements about the manner
in which Inverness Medical Innovations, Inc. (the "Company") intends to use the
assets of the Unipath Business (as defined below), the anticipated impact of the
transaction on the future growth of the Company and the expected benefits of the
transaction. Actual results may materially differ due to numerous risks and
uncertainties, including, without limitation, the operational integration
associated with the transaction and other risks generally associated with such
transactions; the potential market acceptance of the Company's and the Unipath
Business' current and future products; the intensely competitive environment in
the Company's and the Unipath Business' markets which could reduce the Company's
market share or limit its ability to increase market share; the efficacy and the
safety of the products; the content and timing of submissions to and decisions
by regulatory authorities both in the United States and abroad; the ability to
manufacture sufficient quantities of product for development and
commercialization activities; the ability of the Company to successfully develop
and commercialize new products and technologies; and the risks and uncertainties
described in the Company's periodic reports filed with the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended,
including, without limitation, those risks and uncertainties described in the
Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
2001. The Company disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
ITEM 2 - ACQUISITION OF ASSETS
On December 20, 2001, Inverness Medical Innovations, Inc., a Delaware
corporation (the "Company"), acquired Unipath Limited, a global leader in home
pregnancy and ovulation testing and natural family planning, and its associated
companies and assets (the "Unipath Business") from Unilever U.K. Holdings
Limited and certain affiliated entities (the "Unilever Group"). The acquisition
of the Unipath Business by the Company was consummated pursuant to a Sale
Agreement, dated December 20, 2001, between the Company and Unilever U.K.
Holdings Limited (the "Sale Agreement").
The Unipath Business is comprised primarily of four former subsidiaries
of the Unilever Group, specifically Unipath Limited, Unipath Diagnostics GmbH,
Unipath Scandanavia A.B. and Unipath B.V., and certain assets. Included in the
acquired assets are facilities in Bedford, England, U.S. marketing and sales
operations in Princeton, New Jersey and certain monoclonal assets and
intellectual property rights. Prior to the acquisition, the Unilever Group used
the assets of the Unipath Business for the development, manufacturing and
distribution of home pregnancy and ovulation testing products and natural family
planning products. The Company intends to continue to use the assets it acquired
in this transaction for this purpose. In addition, the Company intends to use
the acquired assets, together with its existing assets, to develop and
commercialize new products and advanced medical device technologies for the
women's health and other markets, as well as to supplement its existing product
distribution network.
The aggregate consideration paid by the Company for the Unipath
Business was 103 million pounds sterling (approximately 150 million U.S. dollars
or 166 million Euros) in cash, subject to certain adjustments provided for in
the Sale Agreement. The Company financed the acquisition through a combination
of cash on hand and the proceeds from three separate transactions. The three
separate transactions consisted of: (i) the private sale of 1,995,000 shares of
Series A Convertible Preferred Stock (the "Series A Preferred Stock") at $30.00
per share for an aggregate purchase price of $59.85 million, (ii) the private
sale of approximately $20.0 million of subordinated promissory notes (the
"Bridge Notes") and warrants (the "Warrants") and (iii) the establishment of
senior and mezzanine credit facilities with The Royal Bank of Scotland plc and
related entities for an aggregate principal amount of up to approximately $62.5
million. The Series A Preferred Stock is convertible into the common stock of
the Company at a 2-for-1 ratio, subject to adjustment. All or part of the
principal and interest under the Bridge Notes may be converted into shares of
Series A Preferred Stock at a conversion price of $30.00 per share under certain
circumstances. The Warrants are exercisable for an aggregate of 55,189 shares of
common stock of the Company at a purchase price of $18.12 per share, in each
case subject to adjustment. Certain directors of the Company and related persons
and entities purchased shares of Series A Preferred Stock, Bridge Notes and
Warrants. For additional information regarding the identity of the purchasers of
the Series A Preferred Stock, Bridge Notes and Warrants and the amount of funds
provided by each such purchaser, see the signature pages to the Stock Purchase
Agreement attached hereto as Exhibit 99.1 and the Note and Warrant Purchase
Agreement attached hereto as Exhibit 99.3, which information is incorporated
herein by reference.
The Sale Agreement, including the purchase price, was negotiated at
arm's length between the Company and Unilever U.K. Holdings Limited. Neither
the Company nor any director or officer of the Company was affiliated with or
had a material relationship with Unilever U.K. Holdings Limited or any other
member of the Unilever Group.
Page 2
ITEM 7 - FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.
The financial statements of Unipath required to be
filed as part of this report will be filed by the
Company by amendment to this report as soon as
practicable, but not later than March 5, 2002.
(b) PRO FORMA FINANCIAL INFORMATION.
The pro forma financial information required to be
filed as part of this report will be filed by the
Company by amendment to this report as soon as
practicable, but not later than March 5, 2002.
(c) EXHIBITS.
EXHIBIT NO. DESCRIPTION
+2.1 Sale Agreement, dated December 20,
2001, between the Company and
Unilever U.K. Holdings Limited.*
99.1 Stock Purchase Agreement, dated as
of December 14, 2001, between the
Company and the investors named
therein.
99.2 Certificate of Designation,
Preferences and Rights of Series A
Convertible Preferred Stock of the
Company.
99.3 Note and Warrant Purchase Agreement,
dated as of December 14, 2001,
between the Company and the
investors named therein (the "Note
and Warrant Purchase Agreement").
99.4 Form of Subordinated Promissory Note
issued pursuant to the Note and
Warrant Purchase Agreement.
99.5 Form of Warrant issued pursuant to
the Note and Warrant Purchase
Agreement.
99.6 Credit Agreement, dated December 20,
2001, between the Company, Inverness
Medical Switzerland GmbH, the Banks
listed on Schedule 1 thereto, The
Royal Bank of Scotland plc, as
Facility Agent, The Royal Bank of
Scotland plc, as Issuing Bank, The
Royal Bank of Scotland plc, as
Overdraft Bank, and The Royal Bank
of Scotland plc, as Lead Arranger.
99.7 Mezzanine Loan Agreement, dated
December 20, 2001, between the
Company, Inverness Medical
Switzerland GmbH, the Lenders listed
on Schedule 1 thereto, RBS Mezzanine
Limited, as Facility Agent, and RBS
Mezzanine Limited, as Lead Arranger.
+ Portions of this exhibit have been omitted
pursuant to a request for confidential treatment.
* The Company agrees to furnish supplementally to
the Securities and Exchange Commission (the
"Commission") a copy of any omitted schedule or
exhibit to this agreement upon request by the
Commission.
Page 3
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.
INVERNESS MEDICAL INNOVATIONS, INC.
/s/ Duane L. James
----------------------------------
Duane L. James
Vice President of Finance and Treasurer
Date: January 4, 2002
Page 4
EXHIBIT INDEX
EXHIBIT DESCRIPTION
+2.1 Sale Agreement, dated December 20, 2001, between the Company
and Unilever U.K. Holdings Limited.*
99.1 Stock Purchase Agreement, dated as of December 14, 2001,
between the Company and the investors named therein.
99.2 Certificate of Designation, Preferences and Rights of Series A
Convertible Preferred Stock of the Company.
99.3 Note and Warrant Purchase Agreement, dated as of December 14,
2001, between the Company and the investors named therein (the
"Note and Warrant Purchase Agreement").
99.4 Form of Subordinated Promissory Note issued pursuant to the
Note and Warrant Purchase Agreement.
99.5 Form of Warrant issued pursuant to the Note and Warrant
Purchase Agreement.
99.6 Credit Agreement, dated December 20, 2001, between the
Company, Inverness Medical Switzerland GmbH, the Banks listed
on Schedule 1 thereto, The Royal Bank of Scotland plc, as
Facility Agent, The Royal Bank of Scotland plc, as Issuing
Bank, The Royal Bank of Scotland plc, as Overdraft Bank, and
The Royal Bank of Scotland plc, as Lead Arranger.
99.7 Mezzanine Loan Agreement, dated December 20, 2001, between the
Company, Inverness Medical Switzerland GmbH, the Lenders
listed on Schedule 1 thereto, RBS Mezzanine Limited, as
Facility Agent, and RBS Mezzanine Limited, as Lead Arranger.
+ Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.
* The Company agrees to furnish supplementally to the Commission a copy of any
omitted schedule or exhibit to this agreement upon request by the Commission.
Page 5