forms3a.htm
Registration
No. 333-161691
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
__________________
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
Delaware
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MERGE
HEALTHCARE INCORPORATED
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39-1600938
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(State
or other jurisdiction of incorporation or organization
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(Exact
name of registrant as specified in its charter)
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(I.R.S.
Employer Identification
Number)
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6737 West
Washington Street
Milwaukee,
Wisconsin 53214-5650
(414)
977-4000
(Address,
including zip code, and telephone number, including area code, of registrant’s
principal executive offices)
__________________
Justin
C. Dearborn
Chief
Executive Officer
Merge
Healthcare Incorporated
6737
West Washington Street
Milwaukee,
WI 53214-5650
(414)
977-4000
(Name,
address, including zip code, and telephone number, including area code, of agent
for service)
____________________________________________
Copies
to:
Mark
A. Harris
McDermott
Will & Emery LLP
227
West Monroe Street
Chicago,
Illinois 60606-5096
(312)
984-2121
Ann
Mayberry-French
Vice
President, General Counsel and Secretary
Merge
Healthcare Incorporated
6737
West Washington Street
Milwaukee,
WI 53214-5650
(414)
977-4000
Approximate date of commencement of
proposed sale to the public: From time to time
following the effectiveness of this registration statement.
____________________________________________
If the
only securities being registered on this Form are being offered pursuant to
dividend or interest reinvestment plans, please check the following box. ¨
If any of
the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, other
than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. ý
If this
Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. ¨
If this
Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. ¨
If this
Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. ¨
If this
Form is a post-effective amendment to a registration statement filed pursuant to
General Instruction I.D. filed to register additional securities or additional
classes of securities pursuant to Rule 413(b) under the Securities Act, check
the following box. ¨
Indicate
by check mark whether the registrant is a large accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
Large
accelerated filer ¨
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Accelerated
filer ¨
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Non-accelerated
filer x
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Smaller
reporting company ¨
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________________________________________
_____________________________
The
registrant hereby amends this registration statement on such date or dates as
may be necessary to delay its effective date until the registrant shall file a
further amendment that specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to Section 8(a), may determine.
The
information in this prospectus is not complete and may be changed. We may not
sell these securities or accept an offer to buy these securities until the
registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities and it is
not soliciting an offer to buy these securities in any state where the offer or
sale is not permitted.
SUBJECT
TO COMPLETION, DATED October 5, 2009
PROSPECTUS
MERGE
HEALTHCARE INCORPORATED
$100,000,000
Common
Stock
Debt
Securities
Preferred
Stock
Warrants
Depositary
Shares
Stock
Purchase Contracts
Stock
Purchase Units
From time
to time, we may sell up to an aggregate of $100,000,000 of any combination of
the securities described in this prospectus. We will specify the
terms of any offering of such securities in a prospectus
supplement.
You
should read this prospectus, the information incorporated by reference in this
prospectus and any prospectus supplement carefully before you
invest.
Investing
in our securities involves a high degree of risk. You should
carefully consider the risk factors described in the applicable prospectus
supplement and certain of our filings with the Securities and Exchange
Commission, as described under “Risk Factors” on page 3.
This
prospectus may not be used to offer or sell any securities unless accompanied by
a prospectus supplement.
Our
common stock is quoted and traded on the Nasdaq Global Market under the symbol
“MRGE.” On October 2, 2009, the last reported sale price of our
common stock on the Nasdaq Global Market was $3.76. The applicable
prospectus supplement will contain information, where applicable, as to any
other listing on the Nasdaq Global Market or any securities market or exchange
of the securities covered by the prospectus supplement.
The
securities may be offered directly by us to investors, to or through
underwriters or dealers or through agents. If any underwriters are involved in
the sale of any securities offered by this prospectus and any prospectus
supplement, their names, and any applicable purchase price, fee, commission or
discount arrangement between or among them, and any applicable over-allotment
options, will be set forth, or will be calculable from the information set
forth, in the applicable prospectus supplement. The price to the public of such
securities and the net proceeds we expect to receive from such sale will also be
set forth in a prospectus supplement.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is
truthful or complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus
is ,
2009
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This
prospectus is part of a registration statement on Form S-3 that we filed with
the Securities and Exchange Commission, or the SEC, utilizing a “shelf”
registration process. Under this shelf process, we may sell the securities
described in this prospectus in one or more offerings. This prospectus provides
you with a general description of the securities we may offer. Each time we sell
securities, we will provide a prospectus supplement that will contain specific
information about the terms of that offering. The prospectus supplement may also
add, update or change information contained in this prospectus. You should read
both this prospectus and any prospectus supplement together with additional
information described under the heading “Where You Can Find More Information.”
You should rely only on the information contained in or incorporated by
reference in this prospectus and any prospectus supplement. We have
not authorized anyone to provide you with information other than the information
contained or incorporated by reference in this prospectus or any prospectus
supplement. We are not making an offer to sell these securities in
any jurisdiction where the offer or sale is not permitted. The
information contained in this prospectus speaks only as of the date of this
prospectus and the information in the documents incorporated or deemed to be
incorporated by reference in this prospectus speaks only as of the respective
dates those documents were filed with the SEC. To the extent that any
statement that we make in a prospectus supplement is inconsistent with
statements made in this prospectus, the statements made in this prospectus will
be deemed modified or superseded by those made in a prospectus
supplement. The terms “Merge,” “Merge Healthcare,” the “Company,”
“we,” “us,” and “our” refer to Merge Healthcare Incorporated.
We have
filed or incorporated by reference exhibits to the registration statement of
which this prospectus forms a part. You should read the exhibits carefully for
provisions that may be important to you.
Merge Healthcare Incorporated
Merge
Healthcare Incorporated, a Delaware corporation, develops solutions that
automate healthcare data and diagnostic workflow to enable a better electronic
record of the patient experience, and to enhance product development for health
IT, device and pharmaceutical companies and delivers related
services. Merge products, ranging from standards-based development
toolkits to sophisticated clinical applications, have been used by healthcare
providers, vendors and researchers worldwide for over 20 years. Merge
Healthcare’s principal executive offices are located at 6737 West Washington
Street, Suite 2250, Milwaukee, Wisconsin 53214–5650, and the telephone number
there is (414) 977–4000.
Merge
Healthcare was founded in 1987 and specialized in the transformation of legacy
radiology (film–based) images into filmless digitized images for distribution
and diagnostic interpretation. Merge Healthcare acquired eFilm
Medical Inc. in June 2002 for its diagnostic medical image workstation software
capabilities; RIS Logic, Inc. in July 2003 for its RIS software, which manages
business and clinical workflow for imaging centers; AccuImage Diagnostics Corp.
in January 2005 for its advanced visualization technologies for clinical
specialty medical imaging; and Cedara Software Corp. in June 2005, which
significantly enhanced Merge Healthcare’s medical imaging software
offerings. In 2009, Merge Healthcare has acquired:
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·
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Certain
assets of eko systems, inc. in July for its Surgical Management System
capabilities;
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·
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etrials
Worldwide, Inc in July in order to provide clinical trial sponsors and
contract research organizations (“CROs”) comprehensive and configurable
solutions that include both critical imaging technologies and proven
eClinical capabilities; and
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·
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Confirma,
Inc. in September in order to combine forces in an effort to expand
computer aided detection (“CAD”)
technology.
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Merge
Healthcare’s business is health IT software, which can involve any aspect of
moving medical images and/or information into electronic media. Its
major product categories consist of:
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Software
development toolkits and platforms, which give software developers
resources to accelerate new product
development;
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Diagnostic
workstation software applications, which bring specialized reading and
review tools to the clinician’s
desktop;
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RIS
and related applications, which manage the business workflow of an imaging
enterprise or radiology department;
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PACS
and related applications, which manage the medical image workflow of a
healthcare enterprise;
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Surgical
Management Systems, which automate the monitoring and recording of
anesthesia and perfusion before, during and after a
surgery;
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CAD
products, which automate the analysis and interventional guidance of
studies provided by radiology
practices;
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Software-as-a-service
(“SaaS”), which includes electronic data capture (“EDC”), interactive
voice and Web response (“IVR”/”IWR”) and electronic patient diaries
(“eDiary”) for clinical trial sponsors and
CRO’s.
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·
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Consultative
engineering, which provides customer development teams with added
expertise and technology; and
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Managed
Services, which extends additional image and remote information management
capabilities to Merge Healthcare’s
customers.
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Merge
Healthcare generates revenue through licensing software and/or intellectual
property, upgrading and/or renewing those licenses, ongoing service and support
of the solutions, SaaS delivery of solutions, project or hourly professional
services, consultative engineering fees and pay-per-study managed
services.
Merge
Healthcare’s technologies and expertise span all the major digital imaging
modalities, including computed tomography (“CT”), magnetic resonance imaging
(“MRI”), digital x–ray, mammography, ultrasound, echo-cardiology, angiography,
nuclear medicine, positron emission tomography (“PET”) and
fluoroscopy. Merge Healthcare’s offerings are used in all aspects of
clinical imaging workflow, including: the display of a patient’s digital image;
the archiving communication and manipulation of digital images; clinical
applications to analyze digital images; and the use of imaging in
minimally-invasive surgery. Merge Healthcare has continued to
innovate with its product lines and has extended its business into new areas of
medical imaging.
Merge
Healthcare has its software deployed in hospitals and clinics worldwide through
its partner, direct end-user and eCommerce channels and used by clinical trial
sponsors and CRO’s worldwide. Its software is licensed by many of the
world’s largest medical device and healthcare information technology
companies. With global brand recognition for products such as
eFilm Workstation(TM), a downloadable diagnostic imaging application, and
MergeCOM-3 DICOM toolkits, Merge Healthcare is able to generate a foothold in
new international markets upon which it can expand into additional product
lines.
Before
you invest in our securities, in addition to the other information, documents or
reports incorporated by reference in this prospectus and in any prospectus
supplement, you should carefully consider the risk factors set forth in the
section entitled “Risk Factors” in any prospectus supplement as well as in
“Part I, Item 1A. Risk Factors,” in our most recent annual report on
Form 10-K, and in “Part II, Item 1A. Risk Factors,” in our
quarterly reports on Form 10-Q filed subsequent to such Form 10-K,
which are incorporated by reference into this prospectus and any prospectus
supplement in their entirety, as the same may be updated from time to time by
our future filings under the Exchange Act. Each of the risks described in these
sections and documents could materially and adversely affect our business,
financial condition, results of operations and prospects, and could result in a
loss of your investment.
Information
both included and incorporated by reference in this Prospectus may contain
forward-looking statements, concerning, among other things, Merge Healthcare’s
outlook, financial projections and business strategies, all of which are subject
to risks, uncertainties and assumptions. These forward-looking
statements are identified by their use of terms such as “intend,” “plan,” “may,”
“should,” “will,” “anticipate,” “believe,” “could,” “estimate,” “expect,”
“continue,” “potential,” “opportunity,” “project” and similar
terms. These statements are based on certain assumptions and analyses
that each company believes are appropriate under the
circumstances. Should one or more of these risks or uncertainties
materialize, or should the assumptions prove incorrect, actual results may
differ materially from those expected, estimated or projected. Merge
Healthcare can not guarantee that it will achieve these plans, intentions or
expectations. Forward-looking statements speak only as of the date
they are made, and Merge Healthcare undertakes no obligation to publicly update
or revise any of them in light of new information, future events or
otherwise.
Factors
that may impact forward-looking statements include, among others, Merge
Healthcare’s ability to maintain the technological competitiveness of its
current products, develop new products, successfully market its products,
respond to competitive developments, develop and maintain partnerships with
providers of complementary technologies, manage its costs and the challenges
that may come with growth of its business, and attract and retain qualified
sales, technical and management employees. Merge Healthcare is also
affected by the growth and regulation of the medical technology industry,
including the acceptance of enterprise-wide advanced visualization by hospitals,
clinics, and universities, product clearances and approvals by the United Sates
Food and Drug Administration and similar regulatory bodies outside the U.S., and
reimbursement and regulatory practices by Medicare, Medicaid, and private
third-party payer organizations. Merge Healthcare is also affected by
the recent downturn in the U.S. and international economies and as such may be
further impacted by the lack of credit available to its
customers. Merge Healthcare is affected by other factors identified
in its filings with the Securities and Exchange Commission, some of which are
set forth in the section entitled “Item 1A. Risk Factors” in our most recent
Annual Report on Form 10-K and in “Part II, Item 1A. Risk Factors,” in
our quarterly reports on Form 10-Q filed subsequent to such Form 10-K,
which are incorporated by reference into this prospectus and any prospectus
supplement in their entirety, as the same may be updated from time to time by
our future filings under the Exchange Act. Although Merge Healthcare has
attempted to list comprehensively these important factors, it also wishes to
caution investors that other factors may prove to be important in the future in
affecting its operating results. New factors emerge from time to
time, and it is not possible for Merge Healthcare to predict all of these
factors, nor can Merge Healthcare assess the impact each factor or combination
of factors may have on its business.
These
risks and uncertainties, along with the risk factors discussed under “Risk
Factors” in this Prospectus, should be considered in evaluating any
forward-looking statements contained in this Prospectus. All
forward-looking statements speak only as of the date of this
Prospectus. All subsequent written and oral forward-looking
statements attributable to Merge Healthcare or any person acting on its behalf
are qualified by the cautionary statements in this section.
RATIO OF EARNINGS TO FIXED CHARGES
The
following table sets forth our ratio of earnings to fixed charges for the
periods indicated:
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Six
Months Ended
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June
30,
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Year
Ended December 31,
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2009
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2008
(1)
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2008
(2)
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2007
(3)
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2006
(4)
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2005
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2004
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Ratio
of Earnings to Fixed Charges
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2.9 |
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- |
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- |
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- |
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- |
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14.6 |
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3.3 |
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(1)
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For
the six months ended June 30, 2008, earnings were insufficient to cover
fixed charges by $26.4 million.
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(2)
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For
the year ended December 31, 2008, earnings were insufficient to cover
fixed charges by $23.7 million.
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(3)
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For
the year ended December 31, 2007, earnings were insufficient to cover
fixed charges by $171.8 million.
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(4)
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For
the year ended December 31, 2006, earnings were insufficient to cover
fixed charges by $249.5
million.
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For
purposes of computing these ratios, earnings consists of pre-tax income from
continuing operations, plus fixed charges. Fixed charges consist of
interest expense and interest portion of rental expense. The ratio is calculated
by dividing earnings by the sum of the fixed charges. The interest
portion of rental expense is estimated at 23% of rental expense based on net
present value analysis.
Unless
otherwise indicated in any prospectus supplement, we intend to use the net
proceeds from the sale of securities under this prospectus for general corporate
purposes, including working capital.
The
following description, together with the additional information we include in
any applicable prospectus supplement, summarizes the material terms and
provisions of the debt securities that we may offer under this prospectus. The
debt securities will be our direct general obligations and may include
debentures, notes, bonds or other evidences of indebtedness. The debt securities
will be either senior debt securities or subordinated debt securities. The debt
securities will be issued under one or more separate indentures. Senior debt
securities will be issued under a senior debt indenture, and subordinated debt
securities will be issued under a subordinated debt indenture. We use the term
“indentures” to refer to both the senior indenture and the subordinated
indenture. A form of each of the senior indenture and the subordinated indenture
is filed as an exhibit to the registration statement of which this prospectus is
a part. The indentures will be qualified under the Trust Indenture Act. We
use the term “indenture trustee” to refer to either the senior trustee or the
subordinated trustee, as applicable.
The
following summaries of material provisions of the debt securities and indentures
are subject to, and qualified in their entirety by reference to, all the
provisions of the indenture applicable to a particular series of debt securities
and the description thereof contained in the prospectus
supplement.
We will
describe in each prospectus supplement the following terms relating to a series
of debt securities:
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The
title or designation;
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Any
limit on the principal amount that may be
issued;
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Whether
or not we will issue the series of debt securities in global form, the
terms and the Depositary;
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The
annual interest rate, which may be fixed or variable, or the method for
determining the rate and the date interest will begin to accrue, the dates
interest will be payable and the regular record dates for interest payment
dates or the method for determining such
dates;
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Whether
or not the debt securities will be secured or unsecured, and the terms of
any secured debt;
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The
terms of the subordination of any series of subordinated
debt;
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The
place where payments will be
payable;
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Our
right, if any, to defer payment of interest and the maximum length of any
such deferral period;
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The
date, if any, after which, and the price at which, we may, at our option,
redeem the series of debt securities pursuant to any optional redemption
provisions;
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The
date, if any, on which, and the price at which we are obligated, pursuant
to any mandatory sinking fund provisions or otherwise, to redeem, or at
the holder’s option to purchase, the series of debt
securities;
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Whether
the indenture will restrict our ability to pay dividends, or will require
us to maintain any asset ratios or
reserves;
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Whether
we will be restricted from incurring any additional
indebtedness;
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A discussion
on any material or special U.S. federal income tax considerations
applicable to the debt securities;
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The
denominations in which we will issue the series of debt securities, if
other than denominations of $1,000 and any integral multiple
thereof; and
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Any
other specific terms, preferences, rights or limitations of, or
restrictions on, the debt
securities.
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Conversion or Exchange
Rights
We will
set forth in the prospectus supplement the terms on which a series of debt
securities may be convertible into or exchangeable for common stock or other
securities. We will include provisions as to whether conversion or exchange is
mandatory, at the option of the holder or at our option. We may include
provisions pursuant to which the number of shares of common stock or other
securities that the holders of the series of debt securities receive would be
subject to adjustment.
Consolidation, Merger or
Sale
The
indentures will not contain any covenant which restricts our ability to merge or
consolidate, or sell, convey, transfer or otherwise dispose of all or
substantially all of our assets. However, any successor to or acquirer of our
assets must assume all of our obligations under the indentures or the debt
securities, as appropriate.
Events of Default Under the
Indenture
The
following may be events of default under the indentures with respect to any
series of debt securities that we may issue:
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If
we fail to pay interest when due and our failure continues for a number of
days to be stated in the indenture and the time for payment has not been
extended or deferred;
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If
we fail to pay the principal, or premium, if any, when due and the time
for payment has not been extended or
delayed;
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If
we fail to observe or perform any other covenant contained in the debt
securities or the indentures, other than a covenant specifically relating
to another series of debt securities, and our failure continues for a
number of days to be stated in the indenture after we receive notice from
the indenture trustee or holders of at least 25% in aggregate principal
amount of the outstanding debt securities of the applicable
series; and
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If
specified events of bankruptcy, insolvency or reorganization occur as to
us.
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If an
event of default with respect to debt securities of any series occurs and is
continuing, the indenture trustee or the holders of at least 25% in aggregate
principal amount of the outstanding debt securities of that series, by notice to
us in writing, and to the indenture trustee if notice is given by such holders,
may declare the unpaid principal, premium, if any, and accrued interest, if any,
due and payable immediately.
The
holders of a majority in principal amount of the outstanding debt securities of
an affected series may waive any default or event of default with respect to the
series and its consequences, except defaults or events of default regarding
payment of principal, premium, if any, or interest, unless we have cured the
default or event of default in accordance with the indenture. Any waiver will
cure the default or event of default.
Subject
to the terms of the indentures, if an event of default under an indenture occurs
and is continuing, the indenture trustee will be under no obligation to exercise
any of its rights or powers under such indenture at the request or direction of
any of the holders of the applicable series of debt securities, unless such
holders have offered the indenture trustee reasonable indemnity. The holders of
a majority in principal amount of the outstanding debt securities of any series
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the indenture trustee, or exercising any
trust or power conferred on the indenture trustee, with respect to the debt
securities of that series, provided that:
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The
direction given by the holder is not in conflict with any law or the
applicable indenture; and
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Subject
to its duties under the Trust Indenture Act, the indenture trustee
need not take any action that might involve it in personal liability or
might be unduly prejudicial to the holders not involved in the
proceeding.
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A holder
of the debt securities of any series will only have the right to institute a
proceeding under the indentures or to appoint a receiver or trustee, or to seek
other remedies if:
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The
holder has given written notice to the indenture trustee of a continuing
event of default with respect to that
series;
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The
holders of at least 25% in aggregate principal amount of the outstanding
debt securities of that series have made a written request, and such
holders have offered reasonable indemnity to the indenture trustee to
institute the proceeding as
trustee; and
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The
indenture trustee does not institute the proceeding, and does not receive
from the holders of a majority in aggregate principal amount of the
outstanding debt securities of that series other conflicting directions
within 60 days after the notice, request and
offer.
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These
limitations do not apply to a suit instituted by a holder of debt securities if
we default in the payment of the principal, premium, if any, or interest on, the
debt securities.
We will
periodically file statements with the indenture trustee regarding our compliance
with specified covenants in the indentures.
Modification of Indenture;
Waiver
We and
the indenture trustee may change an indenture without the consent of any holders
with respect to specific matters, including:
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To
fix any ambiguity, defect or inconsistency in the
indenture; and
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To
change anything that does not materially adversely affect the interests of
any holder of debt securities of any
series.
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In
addition, under the indentures, the rights of holders of a series of debt
securities may be changed by us and the indenture trustee with the written
consent of the holders of at least a majority in aggregate principal amount of
the outstanding debt securities of each series that is affected. However, we and
the indenture trustee may only make the following changes with the consent of
each holder of any outstanding debt securities affected:
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Extending
the fixed maturity of the series of debt
securities;
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Reducing
the principal amount, reducing the rate of or extending the time of
payment of interest, or any premium payable upon the redemption of any
debt securities; or
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Reducing
the percentage of debt securities, the holders of which are required to
consent to any amendment.
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Each
indenture provides that we can elect to be discharged from our obligations with
respect to one or more series of debt securities, except for obligations
to:
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Register
the transfer or exchange of debt securities of the
series;
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Replace
stolen, lost or mutilated debt securities of the
series;
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Maintain
paying agencies;
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Hold
monies for payment in trust;
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Compensate
and indemnify the indenture
trustee; and
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Appoint
any successor indenture trustee.
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In order
to exercise our rights to be discharged, we must deposit with the indenture
trustee money or government obligations sufficient to pay all the principal of,
any premium, if any, and interest on, the debt securities of the series on the
dates payments are due.
Form, Exchange and
Transfer
We will
issue the debt securities of each series only in fully registered form without
coupons and, unless we otherwise specify in the applicable prospectus
supplement, in denominations of $1,000 and any integral multiple thereof. The
indentures provide that we may issue debt securities of a series in temporary or
permanent global form and as book-entry securities that will be deposited with,
or on behalf of, The Depositary Trust Company or another Depositary named
by us and identified in a prospectus supplement with respect to that series. See
“Book-Entry Issuance” for a further description of the terms relating to any
book-entry securities.
Subject
to the terms of the indentures and the limitations applicable to global
securities described in the applicable prospectus supplement, the holder of the
debt securities of any series, at its option, can exchange the debt securities
for other debt securities of the same series, in any authorized denomination and
of like tenor and aggregate principal amount.
Subject
to the terms of the indentures and the limitations applicable to global
securities set forth in the applicable prospectus supplement, holders of the
debt securities may present the debt securities for exchange or for registration
of transfer, duly endorsed or with the form of transfer endorsed thereon duly
executed if so required by us or the security registrar, at the office of the
security registrar or at the office of any transfer agent designated by us for
this purpose. Unless otherwise provided in the debt securities that the holder
presents for transfer or exchange, no service charge will be required for any
registration of transfer or exchange, but we may require payment of any taxes or
other governmental charges.
We will
name in the applicable prospectus supplement the security registrar, and any
transfer agent in addition to the security registrar, that we initially
designate for any debt securities. We may at any time designate additional
transfer agents or rescind the designation of any transfer agent or approve a
change in the office through which any transfer agent acts, except that we will
be required to maintain a transfer agent in each place of payment for the debt
securities of each series.
If we
elect to redeem the debt securities of any series, we will not be required
to:
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Issue,
register the transfer of, or exchange any debt securities of that series
during a period beginning at the opening of business 15 days before
the day of mailing of a notice of redemption of any debt securities that
may be selected for redemption and ending at the close of business on the
day of the mailing; or
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Register
the transfer of or exchange any debt securities so selected for
redemption, in whole or in part, except the unredeemed portion of any debt
securities we are redeeming in
part.
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Payment and Paying
Agents
Unless we
otherwise indicate in the applicable prospectus supplement, we will make payment
of the interest on any debt securities on any interest payment date to the
person in whose name the debt securities, or one or more predecessor securities,
are registered at the close of business on the regular record date for the
interest.
We will
pay principal of and any premium and interest on the debt securities of a
particular series at the office of the paying agents designated by us, except
that unless we otherwise indicate in the applicable prospectus supplement, we
will make interest payments by check which we will mail to the holder. Unless we
otherwise indicate in a prospectus supplement, we will designate the corporate
trust office of the indenture trustee in the City of New York as our sole paying
agent for payments with respect to debt securities of each series. We will name
in the applicable prospectus supplement any other paying agents that we
initially designate for the debt securities of a particular series. We will
maintain a paying agent in each place of payment for the debt securities of a
particular series.
All money
we pay to a paying agent or the indenture trustee for the payment of the
principal of or any premium or interest on any debt securities which remains
unclaimed at the end of two years after such principal, premium or interest has
become due and payable will be repaid to us, and the holder of the security
thereafter may look only to us for payment thereof.
The
indentures and the debt securities will be governed by and construed in
accordance with the laws of the State of New York, except to the extent that the
Trust Indenture Act is applicable.
Subordination of Subordinated
Notes
The
subordinated notes will be unsecured and will be subordinate and junior in
priority of payment to certain of our other indebtedness to the extent described
in a prospectus supplement. The subordinated indenture does not limit the amount
of subordinated notes which we may issue. It also does not limit us from issuing
any other secured or unsecured debt.
Regarding the Indenture
Trustee
We will
name the indenture trustee for debt securities issued under the applicable
indenture in the applicable supplement to this prospectus and, unless otherwise
indicated in a prospectus supplement, the indenture trustee will also act as
Transfer Agent and Paying Agent with respect to the debt securities. The
indenture trustee may be removed at any time with respect to the debt securities
of any series by act of the holders of a majority in principal amount of the
outstanding debt securities of such series delivered to the indenture trustee
and to us.
Merge
Healthcare’s authorized capital stock consists of 100,000,000 shares of common
stock, par value $.01 per share, 1,000,000 shares of preferred stock, par value
$.01 per share, and one share of Series 3 Special Voting Stock preferred stock,
par value $.01 per share. As of September 30, 2009, there were
66,127,790 shares of Merge Healthcare Common Stock issued, including 479,997
shares subject to restricted stock awards. There are currently no
shares of preferred stock outstanding. The Merge Healthcare Common
Stock is held of record by approximately 350 stockholders. On
September 30, 2009, 4,853,113 shares of Merge Healthcare Common Stock were
subject to outstanding options.
The
following description of the terms of the common stock and preferred stock of
Merge Healthcare is not complete and is qualified in its entirety by reference
to Merge’s certificate of incorporation and bylaws, each as amended to
date. To find out where copies of these documents can be obtained,
see “Where to Obtain More Information.”
Common
Stock
Holders
of Merge Healthcare Common Stock are entitled to receive dividends when, as and
if declared by the board of directors, out of funds legally available for the
payment of dividends, subject to the rights of holders of preferred stock, if
any. On June 19, 2008, Merge Healthcare paid a dividend of $0.001 on
each share of Merge Healthcare Common Stock as part of the termination of a
rights plan. Merge Healthcare does not anticipate paying any cash
dividends in the foreseeable future. Each holder of Merge Healthcare
Common Stock is entitled to one vote per share. Upon any liquidation,
dissolution or winding-up of its business, the holders of Merge Healthcare
Common Stock are entitled to share equally in all assets available for
distribution after payment of all liabilities and provision for liquidation
preference of any shares of preferred stock then outstanding. The
holders of Merge Healthcare Common Stock have no preemptive rights and no rights
to convert their common stock into any other securities. There are
also no redemption or sinking fund provisions applicable to the Merge Healthcare
Common Stock.
Merge
Healthcare Common Stock is listed on the NASDAQ Global Market under the symbol
“MRGE.”
The
transfer agent and registrar for the Merge Healthcare Common Stock is American
Stock Transfer and Trust Company LLC.
Preferred
Stock
Merge
Healthcare’s board of directors has the authority, without further action by the
stockholders, to issue up to 1,000,001 shares of Merge Healthcare preferred
stock in one or more series and to fix the following terms of the preferred
stock:
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Designations,
powers, preferences,
privileges;
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Relative
participating, optional or special rights;
and
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The
qualifications, limitations or restrictions, including dividend rights,
conversion rights, voting rights, terms of redemption and liquidation
preferences.
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Any or
all of these rights may be greater than the rights of the Merge Healthcare
Common Stock. Of the authorized preferred stock, one share has been
designated Series 3 Special Voting Stock preferred stock (“Series 3 Stock”),
$0.01 par value per share. The Series 3 Stock ranks senior to Merge
Healthcare Common Stock and junior to all other classes or series of the stock
of Merge Healthcare.
Merge
Healthcare’s board of directors, without stockholder approval, can issue
preferred stock with voting, conversion or other rights that could negatively
affect the voting power and other rights of the holders of Merge Healthcare
Common Stock. Preferred stock could thus be issued quickly with terms
calculated to delay or prevent a change in control of Merge Healthcare or make
it more difficult to remove Merge Healthcare’s
management. Additionally, the issuance of Merge Healthcare preferred
stock may have the effect of decreasing the market price of Merge Healthcare
Common Stock.
Delaware
Law Anti-takeover Provisions
As a
Delaware corporation, Merge Healthcare is subject to the provisions of Section
203 of the DGCL. Under Section 203, Merge Healthcare generally would
be prohibited from engaging in any business combination with an interested
stockholder for a period of three years following the time that the stockholder
became an interested stockholder unless:
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Prior
to such time, Merge Healthcare’s board of directors approved either the
business combination or the transaction that resulted in the stockholder
becoming an interested stockholder;
or
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Upon
consummation of the transaction that resulted in the stockholder becoming
an interested stockholder, the interested stockholder owned at least 85%
of Merge Healthcare’s voting stock outstanding at the time the transaction
commenced, excluding shares owned by persons who are directors and
officers, and also by employee stock plans in which employee participants
do not have the right to determine confidentially whether shares held
subject to the plan will be tendered in a tender or exchange offer; or at
or subsequent to such time, the business combination is approved by Merge
Healthcare’s board of directors and authorized at an annual or special
meeting of Merge Healthcare’s stockholders, and not by written consent, by
the affirmative vote of at least 66-2/3% of the outstanding voting stock
that is not owned by the interested
stockholder.
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Under
Section 203, a “business combination” includes:
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Any
merger or consolidation involving the corporation and the interested
stockholder;
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Any
sale, transfer, pledge or other disposition of 10% or more of a
corporation’s assets involving the interested
stockholder;
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Any
transaction that results in the issuance or transfer by the corporation of
any of its stock to the interested stockholder, subject to limited
exceptions;
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Any
transaction involving the corporation that has the effect of increasing
the proportionate share of the stock of any class or series of the
corporation’s capital stock beneficially owned by the interested
stockholder; or the receipt by the interested stockholder of the benefit
of any loans, advances, guarantees, pledges or other financial benefits
provided by or through the
corporation.
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In
general, Section 203 defines an “interested stockholder” of Merge Healthcare as
any entity or person beneficially owning 15% or more of the outstanding Merge
Healthcare voting stock and any entity or person affiliated with or controlling
or controlled by such entity or person.
The
description of Section 203 of the DGCL above is qualified in its entirety be
reference to such section.
Certificate
of Incorporation and Bylaw Provisions
Various
provisions contained in Merge’s certificate of incorporation and bylaws, each as
amended to date, could delay or discourage some transactions involving an actual
or potential change in control of Merge Healthcare or its management and may
limit the ability of Merge Healthcare stockholders to remove current management
or approve transactions that Merge Healthcare stockholders may deem to be in
their best interests. These provisions:
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Authorize
Merge Healthcare’s board of directors to establish one or more series of
undesignated preferred stock, the terms of which can be determined by the
board of directors at the time of
issuance;
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Require
that any action required or permitted to be taken by Merge Healthcare’s
stockholders must be effected at a duly called annual or special meeting
of stockholders and may not be effected by any consent in
writing;
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Provide
an advanced written notice procedure with respect to stockholder proposals
and the nomination of candidates for election as directors, other than
nominations made by or at the direction of Merge Healthcare’s board of
directors or a committee of its board of
directors;
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State
that special meetings of Merge Healthcare’s stockholders may be called
only by the chairman of its board of directors, its chief executive
officer or by a majority of its board of directors then in office;
and
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Allow
Merge Healthcare’s directors to fill vacancies on its board of directors,
including vacancies resulting from removal or enlargement of the
board.
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The
following description, together with the additional information we include in
any applicable prospectus supplement, summarizes the material terms and
provisions of the warrants that we may offer under this
prospectus. The following statements with respect to the warrants are
summaries of, and subject to, the detailed provisions of a warrant agreement to
be entered into by Merge Healthcare and a warrant agent to be selected at the
time of issue (the “warrant agent”), a form of which will be filed with the
SEC.
General
The
warrants, evidenced by warrant certificates, may be issued under the warrant
agreement independently or together with any securities offered by any
prospectus supplement and may be attached to or separate from such
securities. If warrants are offered, the prospectus supplement will
describe the terms of the warrants, including the following:
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The
offering price, if any;
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If
applicable, the designation, aggregate principal amount, and terms of the
debt securities purchasable upon exercise of the debt
warrants;
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If
applicable, the principal amount of debt securities purchasable upon
exercise of one debt warrant and the price at which such principal amount
of debt securities may be purchased upon such
exercise;
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If
applicable, the number of shares of preferred stock or common stock
purchasable upon exercise of each warrant and the initial price at which
such shares may be purchased upon
exercise;
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If
applicable, the designation and terms of the securities with which the
warrants are issued and the number of warrants issued with each such
security;
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If
applicable, the date on and after which the warrants and the related
securities will be separately
transferable;
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The
date on which the right to exercise the warrants shall commence and the
date on which such right shall
expire;
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Federal
income tax consequences;
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Call
provisions of such warrants, if
any;
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Anti-dilution
provisions of the warrants, if any;
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Whether
the warrants represented by the warrant certificates will be issued in
registered or bearer form; and
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Any
additional or other terms, procedures, rights, preferences, privileges,
limitations and restrictions relating to the warrants, including terms,
procedures and limitations relating to the exchange and exercise of the
warrants.
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The
shares of preferred stock or common stock issuable upon the exercise of the
warrants will, when issued in accordance with the warrant agreement, be fully
paid and non-assessable.
The
following description, together with the additional information we include in
any applicable prospectus supplement, summarizes the material terms and
provisions of the depositary shares that we may offer under this prospectus. The
following statements with respect to the depositary shares and depositary
receipts are summaries of, and subject to, the detailed provisions of a deposit
agreement to be entered into by Merge Healthcare and a depositary to be selected
at the time of issue (the “depositary”) and the form of depositary receipt. The
form of deposit agreement and the form of depositary receipt will be filed with
the SEC.
We may,
at our option, elect to issue fractional shares of preferred stock, rather than
full shares of preferred stock. In the event such option is exercised, we may
elect to have a depositary issue receipts for depositary shares, each receipt
representing a fraction, to be set forth in the prospectus supplement relating
to a particular series of preferred stock, of a share of a particular series of
preferred stock as described below.
The
shares of any series of preferred stock represented by depositary shares will be
deposited under a deposit agreement between us and a bank or trust company that
we select. Subject to the terms of the deposit agreement, each owner of a
depositary share will be entitled, in proportion to the applicable fraction of a
share of preferred stock represented by such depositary share, to all the rights
and preferences of the preferred stock represented by the depositary share,
including dividend, voting, redemption and liquidation
rights.
The
depositary shares will be evidenced by depositary receipts issued pursuant to
the deposit agreement. Depositary receipts will be distributed to those persons
purchasing the fractional shares of preferred stock in accordance with the terms
of an offering of the preferred stock.
Withdrawal of Preferred
Stock
Upon
surrender of depositary receipts at the office of the depositary and upon
payment of the charges provided in the deposit agreement, a holder of depositary
receipts may have the depositary deliver to the holder the whole shares of
preferred stock relating to the surrendered depositary receipts. Holders of
depositary shares may receive whole shares of the related series of preferred
stock on the basis set forth in the related prospectus supplement for such
series of preferred stock, but holders of such whole shares will not after the
exchange be entitled to receive depositary shares for their whole shares. If the
depositary receipts delivered by the holder evidence a number of depositary
shares in excess of the number of depositary shares representing the number of
whole shares of the related series of preferred stock to be withdrawn, the
depositary will deliver to the holder at the same time a new depositary receipt
evidencing such excess number of depositary shares.
Dividends and Other
Distributions
The
depositary will distribute all cash dividends or other cash distributions
received for the preferred stock to the record holders of depositary shares
relating to the preferred stock in proportion to the numbers of such depositary
shares owned by such holders.
In the
event of a distribution other than in cash, the depositary will distribute
property received by it to the record holders of depositary shares entitled
thereto, unless the depositary determines that it is not feasible to make
distribution of the property. In that case the depositary may, with our
approval, sell such property and distribute the net proceeds from the sale to
such holders.
Redemption of Depositary
Shares
If a
series of preferred stock represented by depositary shares is subject to
redemption, the depositary shares will be redeemed from the proceeds received by
the depositary resulting from the redemption, in whole or in part, of the series
of preferred stock held by the depositary. The redemption price per depositary
share will be equal to the applicable fraction of the redemption price per share
payable with respect to the series of the preferred stock. Whenever we redeem
shares of preferred stock held by the depositary, the depositary will redeem as
of the same redemption date the number of depositary shares representing shares
of preferred stock redeemed by us. If less than all the depositary shares are to
be redeemed, the depositary shares to be redeemed will be selected by lot or pro
rata as may be determined by the depositary.
Voting the Preferred
Stock
Upon
receipt of notice of any meeting at which the holders of the preferred stock are
entitled to vote, the depositary will mail the information contained in such
notice of meeting to the record holders of the depositary shares relating to
such preferred stock. Each record holder of such depositary shares on the record
date, which will be the same date as the record date for the preferred stock,
will be entitled to instruct the depositary as to the exercise of the voting
rights pertaining to the amount of the preferred stock represented by such
holder’s depositary shares. The depositary will endeavor, insofar as
practicable, to vote the amount of the preferred stock represented by such
depositary shares in accordance with such instructions, and we will agree to
take all action which may be deemed necessary by the depositary in order to
enable the depositary to do so. The depositary will not vote the preferred stock
to the extent it does not receive specific instructions from the holders of
depositary shares representing such preferred stock.
Amendment and Termination of the
Deposit Agreement
We and
the depositary at any time may amend the form of depositary receipt evidencing
the depositary shares and any provision of the deposit agreement. However, any
amendment which materially and adversely alters the rights of the holders of
depositary shares will not be effective unless such amendment has been approved
by the holders of at least a majority of the depositary shares then outstanding.
We or the depositary may terminate the deposit agreement only if all outstanding
depositary shares have been redeemed, or there has been a final distribution in
respect of the preferred stock in connection with any liquidation, dissolution
or winding up of Merge Healthcare and such distribution has been distributed to
the holders of depositary receipts.
We will
pay all transfer and other taxes and governmental charges arising solely from
the existence of the depositary arrangements. We will pay charges of the
depositary in connection with the initial deposit of the preferred stock and any
redemption of the preferred stock. Holders of depositary receipts will pay other
transfer and other taxes and governmental charges and such other charges as are
expressly provided in the deposit agreement to be for their
accounts.
The
depositary will forward to the record holders of the depositary shares relating
to such preferred stock all reports and communications from us which are
delivered to the depositary.
Neither
we nor the depositary will be liable if either one is prevented or delayed by
law or any circumstance beyond their control in performing the obligations under
the deposit agreement. The obligations of Merge Healthcare and the depositary
under the deposit agreement will be limited to performance in good faith of
their duties thereunder, and they will not be obligated to prosecute or defend
any legal proceeding in respect of any depositary shares or preferred stock
unless satisfactory indemnity is furnished. The depositary may rely upon written
advice of counsel or accountants, or information provided by persons presenting
preferred stock for deposit, holders of depositary receipts or other persons
believed to be competent and on documents believed to be
genuine.
Resignation and Removal of
Depositary
The
depositary may resign at any time by delivering to us notice of its election to
do so, and we may at any time remove the depositary, any such resignation or
removal to take effect upon the appointment of a successor depositary and its
acceptance of such appointment. Such successor depositary must be appointed
within 60 days after delivery of the notice of resignation or
removal.
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE
UNITS
We may
issue stock purchase contracts, representing contracts obligating holders to
purchase from us, and we may sell to the holders, a specified number of shares
of common stock at a future date or dates. The price per share of
common stock may be fixed at the time the stock purchase contracts are issued or
may be determined by reference to a specific formula set forth in the stock
purchase contracts. Stock purchase contracts may be issued separately
or as a part of units (“stock purchase units”) consisting of a stock purchase
contract and either (i) senior debt securities or subordinated debt securities
or (ii) debt obligations of third parties, including U.S. Treasury securities,
securing the holder’s obligations to purchase the common stock under the stock
purchase contracts. The stock purchase contracts may require us to
make periodic payments to the holders of the stock purchase units or vice versa,
and such payments may be unsecured or prefunded on some basis. The
stock purchase contracts may require holders to secure their obligations
thereunder in a specified manner and in certain circumstances we may deliver
newly issued prepaid stock purchase contracts (“prepaid securities”) upon
release to a holder of any collateral securing such holder’s obligations under
the original stock purchase contract.
The
applicable prospectus supplement will describe the terms of any stock purchase
contracts or stock purchase units and, if applicable, prepaid
securities. Certain material United States Federal income tax
considerations applicable to the stock purchase units and stock purchase
contracts will be set forth in the prospectus supplement relating
thereto.
Unless
otherwise indicated in a prospectus supplement, the debt securities of a series
offered by us will be issued in the form of one or more fully registered global
securities. We anticipate that these global securities will be deposited with,
or on behalf of, the Depository Trust Company and registered in the name of its
nominee. Except as described below, the global securities may be transferred, in
whole and not in part, only to DTC or to another nominee of DTC.
DTC has
advised us that it is:
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A limited-purpose
trust company organized under the New York Banking
Law;
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A “banking
organization” within the meaning of the New York Banking
Law;
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A member
of the Federal Reserve System;
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A “clearing
corporation” within the meaning of the New York Uniform Commercial Code;
and
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A “clearing
agency” registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934.
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DTC was
created to hold securities for institutions that have accounts with DTC
(“participants”) and to facilitate the clearance and settlement of securities
transactions among its participants through electronic book-entry changes in
participants’ accounts. Participants include securities brokers and dealers,
banks, trust companies, clearing corporations and certain other organizations,
some of whom (and/or their representatives) own DTC. Access to DTC’s book-entry
system is also available to others that clear through or maintain a custodial
relationship with a participant, either directly or indirectly. DTC administers
its book-entry system in accordance with its rules and bylaws and legal
requirements.
Upon
issuance of a global security representing offered securities, DTC will credit
on its book-entry registration and transfer system the principal amount to
participants’ accounts. Ownership of beneficial interests in the global security
will be limited to participants or to persons that hold interests through
participants. Ownership of interests in the global security will be shown on,
and the transfer of those ownership interests will be effected only through,
records maintained by DTC (with respect to participants’ interests) and the
participants (with respect to the owners of beneficial interests in the global
security). The laws of some jurisdictions may require that certain purchasers of
securities take physical delivery of those securities in definitive form. These
limits and laws may impair the ability to transfer beneficial interests in a
global security.
So long
as DTC (or its nominee) is the registered holder and owner of a global security,
DTC (or its nominee) will be considered, for all purposes under the applicable
indenture, the sole owner and holder of the related offered securities. Except
as described below, owners of beneficial interests in a global security will
not:
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Be
entitled to have the securities registered in their names;
or
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Receive
or be entitled to receive physical delivery of certificated securities in
definitive form.
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Purchases
of securities under the DTC system must be made by or through direct
participants, which will receive a credit for the securities on DTC’s records.
The ownership interest of each actual purchaser of each debt security
(“beneficial owner”) is in turn recorded on the Direct and indirect
participants’ records. A beneficial owner does not receive written confirmation
from DTC of its purchase, but is expected to receive a written confirmation
providing details of the transaction, as well as periodic statements of its
holdings, from the direct or indirect participants through which such beneficial
owner entered into the action. Transfers of ownership interests in securities
are accomplished by entries made on the books of participants acting on behalf
of beneficial owners. Beneficial owners do not receive certificates representing
their ownership interests in securities, except in the event that use of the
book-entry system for the securities is discontinued.
To
facilitate subsequent transfers, the securities are registered in the name of
DTC’s partnership nominee, Cede & Co. The deposit of the securities with DTC
and their registration in the name of Cede & Co. will effect no change in
beneficial ownership. DTC has no knowledge of the actual beneficial owners of
the securities; DTC records reflect only the identity of the direct participants
to whose accounts securities are credited, which may or may not be the
beneficial owners. The participants remain responsible for keeping account of
their holdings on behalf of their customers.
Delivery
of notice and other communications by DTC to direct participants, by direct
participants to indirect participants, and by direct participants and indirect
participants to beneficial owners are governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in effect from
time to time.
Neither
DTC nor Cede & Co. consents or votes with respect to the securities. Under
its usual procedures, DTC mails a proxy (an “Omnibus Proxy”) to the issuer as
soon as possible after the record date. The Omnibus Proxy assigns Cede &
Co.’s consenting or voting rights to those direct participants to whose accounts
the securities are credited on the record date (identified on a list attached to
the Omnibus Proxy).
Redemption
proceeds, distributions and dividend payments, if any, on the securities will be
made to DTC. DTC’s practice is to credit direct participants’ accounts on the
payment date in accordance with their respective holdings as shown on DTC’s
records, unless DTC has reason to believe that it will not receive payment on
the payment date. Payments by participants to beneficial owners are governed by
standing instructions and customary practices, as is the case with securities
held for the accounts of customers in bearer form or registered in “street
name,” and are the responsibility of such Participant and not of DTC, the
trustee or us, subject to any statutory or regulatory requirements as may be in
effect from time to time. Payment of principal and interest, if any, to DTC is
our or the trustee’s responsibility, disbursement of such payments to direct
participants is DTC’s responsibility, and disbursement of such payments to the
beneficial owners is the responsibility of direct and indirect
participants.
DTC may
discontinue providing its services as securities depository with respect to the
securities at any time by giving reasonable notice to us or the trustee. Under
such circumstances, in the event that a successor securities depository is not
appointed, debt security certificates are required to be printed and
delivered.
We may
decide to discontinue use of the system of book-entry transfers through DTC or a
successor securities depository. In that event, debt security certificates will
be printed and delivered.
We have
obtained the information in this section concerning DTC and DTC’s book-entry
system from sources that we believe to be reliable, but we take no
responsibility for the accuracy of this information.
None of
us, any underwriter or agent, the trustee or any applicable paying agent will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial interests in a global security, or for
maintaining, supervising or reviewing any records relating to such beneficial
interest.
|
·
|
Through
underwriters or dealers;
|
|
·
|
Directly
to one or more purchasers;
|
|
·
|
Through
any other methods described in a prospectus
supplement.
|
The
prospectus supplement will state the terms of the offering of the securities,
including:
|
·
|
The
name or names of any underwriters, dealers or
agents;
|
|
·
|
The
purchase price of such securities and the proceeds to be received by
Merge, if any;
|
|
·
|
Any
underwriting discounts or agency fees and other items constituting
underwriters’ or agents’
compensation;
|
|
·
|
Any
public offering price;
|
|
·
|
Any
discounts or concessions allowed or reallowed or paid to dealers;
and
|
|
·
|
Any
securities exchanges on which the securities may be
listed.
|
Any
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
Securities
may also be sold in one or more of the following transactions, or in any
transactions described in a prospectus supplement:
|
·
|
Block
transactions in which a broker-dealer may sell all or a portion of the
securities as agent but may position and resell all or a portion of the
block as principal to facilitate the
transaction;
|
|
·
|
Purchase
by a broker-dealer as principal and resale by the broker-dealer for its
own account;
|
|
·
|
A special
offering, an exchange distribution or a secondary distribution in
accordance with the rules of any exchange on which the securities are
listed;
|
|
·
|
Ordinary
brokerage transactions and transactions in which a broker-dealer solicits
purchasers;
|
|
·
|
Sales
“at the market” to or through a market maker or into an existing trading
market, on an exchange or otherwise;
or
|
|
·
|
Sales
in other ways not involving market makers or established trading markets,
including direct sales to
purchasers.
|
The
securities we sell by any of the methods described above may be sold to the
public, in one or more transactions, either:
|
·
|
At
a fixed public offering price or prices, which may be
changed;
|
|
·
|
At
market prices prevailing at the time of
sale;
|
|
·
|
At
prices related to prevailing market prices;
or
|
We may
sell the securities through agents from time to time. The prospectus supplement
will name any agent involved in the offer or sale of the securities and any
commissions we pay to them. Generally, any agent will be acting on a best
efforts basis for the period of its appointment.
We may
authorize underwriters, dealers or agents to solicit offers by certain
purchasers to purchase the securities from Merge at the public offering price
set forth in the prospectus supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the future. The
contracts will be subject only to those conditions set forth in the prospectus
supplement, and the prospectus supplement will set forth any commissions we pay
for solicitation of these contracts.
Underwriters
and agents may be entitled under agreements entered into with Merge to
indemnification by Merge against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect to
payments which the underwriters or agents may be required to make. Underwriters
and agents may engage in transactions with, or perform services for Merge and
its affiliates in the ordinary course of business.
Unless
otherwise indicated in the applicable prospectus supplements, certain legal
matters in connection with the securities will be passed upon for us by
McDermott Will & Emery LLP, Chicago, Illinois.
The
financial statements of Merge Healthcare as of December 31, 2008 and for the
year then ended incorporated by reference in this Prospectus have been so
incorporated in reliance on the report of BDO Seidman, LLP, an independent
registered public accounting firm, incorporated herein by reference, given on
the authority of said firm as experts in auditing and accounting.
The
consolidated financial statements of Merge Healthcare as of December 31, 2007,
and for each of the years in the two-year period ended December 31, 2007, have
been incorporated by reference herein in reliance upon the report, dated March
31, 2008, of KPMG LLP, an independent registered public accounting firm,
incorporated by reference herein, and upon the authority of KPMG LLP as experts
in accounting and auditing. KPMG LLP’s report covering the December 31, 2007
consolidated financial statements contains an explanatory paragraph that states
that Merge Healthcare’s recurring losses from operations and negative cash flows
raise substantial doubt about its ability to continue as a going
concern. The consolidated financial statements do not include any
adjustments that might result from the outcome of this
uncertainty. KPMG LLP’s report covering the December 31, 2007
consolidated financial statements also contains an explanatory paragraph
relating to the adoption of Financial Accounting Standards Board Interpretation
No. 48, Accounting for Uncertainty in Income Taxes, as of January 1, 2007, and
the adoption of Statement of Financial Accounting Standards No. 123 (revised
2004), Share-Based Payment, as of January 1, 2006.
The
consolidated financial statements of etrials Worldwide, Inc. appearing in
etrials Worldwide Inc.’s Annual Report (Form 10-K) for the year ended December
31, 2008 have been audited by Ernst & Young LLP, independent registered
public accounting firm, as set forth in their report thereon, included therein,
and incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
The
consolidated financial statements of Confirma, Inc. as of and for the years
ended December 31, 2008 and 2007 have been audited by Voldal Wartelle & Co.,
P.S., independent certified public accounting firm, as set forth in their report
thereon, included therein, and incorporated herein by reference to the Current
Report on Form 8-K filed on September 2, 2009, as amended on September 4, 2009
and September 24, 2009. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and
auditing.
WHERE YOU CAN FIND MORE INFORMATION
Merge
Healthcare files annual, quarterly and current reports, proxy statements and
other information with the SEC. The public may read and copy any
reports, statements or other information that Merge Healthcare files with the
SEC at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C.
20549. Please call the SEC at 1-800-SEC-0330 for further information
regarding the public reference room. Merge Healthcare’s public
filings also are available to the public from commercial document retrieval
services and may be obtained without charge at the SEC’s website at
www.sec.gov. Merge Healthcare’s filings with the SEC are also
available on its website at www.merge.com. The contents of this
website are not incorporated by reference into this Prospectus.
Merge
Healthcare has filed with the SEC a Registration Statement on Form S-3 to
register the offer and sale of shares of Merge Healthcare Common Stock (the
“Registration Statement”). This Prospectus is a part of that
registration statement. Merge Healthcare may also file amendments to
such registration statement. As allowed by SEC rules, this Prospectus
does not contain all of the information in the Registration Statement or the
exhibits to the Registration Statement. You may obtain copies of the
Form S-3 (and any amendments to those documents) by contacting the information
agent as directed on the back cover of this Prospectus.
The SEC
allows Merge Healthcare to incorporate information into this Prospectus “by
reference,” which means that Merge Healthcare can disclose important information
by referring to another document or information filed separately with the
SEC. The information incorporated by reference is deemed to be part
of this Prospectus, except for any information amended or superseded by
information contained in, or incorporated by reference into, this
Prospectus. This Prospectus incorporates by reference the documents
and information set forth below that Merge Healthcare (File No. 29486) has
previously filed (but not furnished) with the SEC. These documents
contain important information about Merge Healthcare and its financial
condition.
Merge
Healthcare Filings (File No. 29486)
Merge Healthcare Information Incorporated by
Reference
|
|
Period Covered or Date of
Filing
|
Quarterly
Report on Form 10-Q for fiscal quarter ended June 30, 2009, as filed with
the SEC on July 31, 2009
|
|
Fiscal
quarter ended June 30, 2009
|
|
|
|
Quarterly
Report on Form 10-Q for fiscal quarter ended March 31, 2009, as filed with
the SEC on May 8, 2009
|
|
Fiscal
quarter ended March 31, 2009
|
|
|
|
Annual
Report on Form 10-K for fiscal year ended December 31, 2008, as filed with
the SEC on March 11, 2009
|
|
Fiscal
year ended December 31, 2008
|
|
|
|
Proxy
Statement on Schedule 14A as filed with the SEC on April 24, 2009 (other
than such information that is included in the proxy statement but not
deemed to be filed with the SEC).
|
|
|
|
|
|
The
description of Merge Healthcare Common Stock set forth in Merge
Healthcare’s Registration Statement on Form 8-A, filed with the SEC on
January 9, 1998, including all amendments and reports filed for the
purpose of updating such description.
|
|
|
|
|
|
Current
Reports on Form 8-K
|
|
Filed
with the SEC on:
•
June 2, 2009
•
April 16, 2009
•
April 6, 2009
•
March 5, 2009
•
February 17, 2009
•
January 7, 2009
•
June 16, 2009
•
July 15, 2009
•
July 20, 2009
•
August 10, 2009
•
September 2, 2009 (as
amended on September 4, 2009 and September 24,
2009)
|
|
|
|
The
consolidated financial statements of etrials Worldwide, Inc. for the
fiscal years ended December 31, 2008 and 2007, as set forth on pages F-15
to F-36 in the Prospectus filed with the SEC pursuant to Rule 424(b)(3) on
July 16, 2009
|
|
|
Merge
Healthcare does not incorporate portions of any document that is either (a)
described in paragraphs (d)(1) through (3) and (e)(5) of Item 407 of Regulation
S-K promulgated by the SEC or (b) furnished under Item 2.02 or Item 7.01 of any
Current Report on Form 8-K. Merge Healthcare hereby incorporates by
reference all future filings by Merge Healthcare made pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended,
after the date of this prospectus. Nothing in this Prospectus shall
be deemed to incorporate information furnished but not filed with the
SEC.
Merge
Healthcare will provide without charge upon written or oral request, a copy of
any or all of the documents which are incorporated by reference to this
prospectus, other than exhibits which are specifically incorporated by reference
into those documents. Requests should be directed to Corporate Secretary, Merge
Healthcare Incorporated, 6737 West Washington Street, Milwaukee, WI 53214-5650,
telephone: (414) 977-4000.
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution
Our
estimated expenses in connection with the distribution of the securities being
registered are as set forth in the following table:
SEC
Registration Fee
|
|
$ |
6,000
|
* |
Printing
and Engraving Expenses
|
|
|
-
|
* |
Legal
Fees and Expenses
|
|
|
25,000
|
* |
Accounting
Fees and Expenses
|
|
|
30,000
|
* |
Miscellaneous
|
|
|
-
|
* |
Total
|
|
$ |
61,000 |
|
*Estimated
to nearest thousand U.S. dollars.
Item
15. Indemnification of Directors and Officers
Merge
Healthcare is a Delaware corporation. Reference is made to Section 102(b)(7) of
the General Corporation Law of the State of Delaware (the “DGCL”), which enables
a corporation in its original certificate of incorporation or an amendment to
eliminate or limit the personal liability of a director for violations of the
director’s fiduciary duty, except:
|
·
|
For
any breach of the director’s duty of loyalty to the corporation or its
stockholders;
|
|
·
|
For
acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of
law;
|
|
·
|
Pursuant
to Section 174 of the DGCL (providing for liability of directors for
unlawful payment of dividends or unlawful stock purchases or redemptions);
or
|
|
·
|
For
any transaction from which a director derived an improper personal
benefit.
|
Reference
is also made to Section 145 of the DGCL, which provides that a corporation may
indemnify any persons, including officers and directors, who are, or are
threatened to be made, parties to any threatened, pending or completed legal
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such corporation), by
reason of the fact that such person is or was a director, officer, employee or
agent of such corporation or is or was serving at the request of such
corporation as a director, officer, employee or agent of another corporation or
enterprise. The indemnity may include expenses (including attorneys’
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with such action, suit or proceeding,
provided such director, officer, employee or agent acted in good faith and in a
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that the person’s conduct was
unlawful. A Delaware corporation may indemnify officers and directors
in an action by or in the right of the corporation under the same conditions,
except that no indemnification is permitted without judicial approval if the
officer or director is adjudged to be liable to the
corporation. Where an officer or director is successful on the merits
or otherwise in the defense of any action referred to above, the corporation
must indemnify him against the expenses that such officer or director actually
and reasonably incurred. The indemnification permitted under the DGCL
is not exclusive, and a corporation is empowered to purchase and maintain
insurance against liabilities, whether or not indemnification would be permitted
by statute.
Article
XI of Merge’s Bylaws provides in effect that, subject to certain limited
exceptions, Merge Healthcare shall indemnify its directors and officers to the
extent not prohibited by the DGCL. Merge’s directors and officers are
insured under policies of insurance maintained by Merge Healthcare, subject to
the limits of the policies, against certain losses arising from any claims made
against them by reason of being or having been such directors or
officers. In addition, Merge Healthcare has entered into contracts
with certain of its directors providing for indemnification of such persons by
Merge Healthcare to the full extent authorized or permitted by law, subject to
certain limited exceptions.
Item
16. Exhibits and Financial Statement Schedules
Exhibits
1.1*
|
Form
of Underwriting Agreement for Equity Securities
|
1.2*
|
Form
of Underwriting Agreement for Debt Securities and Related
Warrants.
|
1.3*
|
Form
of Underwriting Agreement for Stock Purchase Contracts and Stock Purchase
Units
|
2.1
|
Merger
Agreement, dated August 7, 2009, between Registrant and Confirma,
Inc. (incorporated herein by reference to Exhibit 99.1 to Merge
Healthcare’s Current Report on Form 8-K filed with the SEC on August 7,
2009).
|
2.2
|
Merger
Agreement, dated May 30, 2009, between Registrant and etrials Worldwide,
Inc. (incorporated herein by reference to Exhibit 99.2 to Merge
Healthcare’s Current Report on Form 8-K filed with the SEC on May 30,
2009).
|
3.1
|
Certificate
of Incorporation of Merge Healthcare Incorporated (incorporated herein by
reference to Exhibit 3.1 to Merge Healthcare’s Annual Report on Form 10-K
for the fiscal year ended December 31, 2008)
|
3.2
|
Bylaws,
(incorporated herein by reference to Exhibit 3.3 to Merge Healthcare’s
Annual Report on Form 10-K for the fiscal year ended December 31,
2008)
|
|
Form
of Indenture for Senior Debt Securities
|
|
Form
of Indenture for Subordinated Debt Securities
|
4.3.*
|
Form
of Debt Security
|
4.4*
|
Form
of Deposit Agreement
|
4.5*
|
Form
of Depositary Receipt
|
4.6*
|
Form
of Deposit Agreement
|
4.7*
|
Form
of Depositary Receipt
|
4.8*
|
Form
of Stock Warrant Agreement
|
4.9*
|
Form
of Debt Warrant Agreement
|
4.10
|
Term
Note, dated June 4, 2008, between Registrant and Merrick RIC, LLC
(incorporated by reference to Exhibit 4.1 to Merge Healthcare’s Current
Report on Form 8-K dated June 6, 2008).
|
|
Opinion
of McDermott Will & Emery LLP
|
|
Computation
of Ratio of Earnings to Fixed Charges
|
|
Consent
of BDO Seidman, LLP
|
|
Consent
of KPMG LLP
|
|
Consent
of Ernst & Young LLP
|
23.4 |
Consent
of Voldal Wartelle & Co., P.S.
|
23.5
|
Consent
of McDermott Will & Emery LLP (included in the opinion filed as
Exhibit 5.1)
|
24
|
Powers
of Attorney (included on the signature pages
hereto)
|
25*
|
Statement
of Eligibility of the Trustee on Form T-1 with respect to the Indentures
for Senior Debt Securities and Subordinated Debt
Securities
|
__________
* To be
filed as an exhibit to a Current Report on Form 8-K.
+ Previously filed as exhibit to Registration
Statement on Form S-3 filed September 2, 2009
Item
17. Undertakings
(a)
|
The
undersigned registrant hereby
undertakes:
|
|
(1)
|
To
file, during any period in which offers or sales are being made, a
post−effective amendment to this registration
statement:
|
|
(i)
|
to
include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933, as amended, or the Securities
Act;
|
|
(ii)
|
to
reflect in the prospectus any facts or events arising after the effective
date of this registration statement (or the most recent post−effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from
the low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the SEC pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering price set forth
in the “Calculation of Registration Fee” table in the effective
registration statement; and
|
|
(iii)
|
to
include any material information with respect to the plan of distribution
not previously disclosed in the registration statement or any material
change to such information in the registration
statement;
|
provided,
however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if
the information required to be included in a post−effective amendment by those
paragraphs is contained in reports filed with or furnished to the SEC by the
registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended, that are incorporated by reference in the registration
statement, or is contained is a form of prospectus filed pursuant to Rule 424(b)
that is part of the registration statement.
|
(2)
|
That,
for purposes of determining any liability under the Securities Act, each
such post−effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
|
|
(3)
|
To
remove from registration by means of a post−effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
|
|
(4)
|
That,
for the purpose of determining liability under the Securities Act to any
purchaser,
|
|
(i)
|
each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be
deemed to be part of the registration statement as of the date the filed
prospectus was deemed part of and included in the registration statement;
and
|
|
(ii)
|
each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or
(b)(7) as part of a registration statement in reliance on Rule 430B
relating to an offering made pursuant to Rule 415(a)(1)(i)(x) for the
purpose of providing the information required by section 10(a) of the
Securities Act shall be deemed to be part of and included in the
registration statement as of the earlier of the date such form of
prospectus is first used after effectiveness or the date of the first
contract of sale of securities in the offering described in the
prospectus. As provided in Rule 430B, for liability purposes of the issuer
and any person that is at that date an underwriter, such date shall be
deemed to be a new effective date of the registration statement relating
to the securities in the registration statement to which that prospectus
relates, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof. Provided, however, that
no statement made in a registration statement or prospectus that is part
of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus
that is part of the registration statement will, as to a purchaser with a
time of contract of sale prior to such effective date, supersede or modify
any statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such document
immediately prior to such effective
date.
|
|
(5)
|
That,
for the purpose of determining liability of the registrant under the
Securities Act to any purchaser in the initial distribution of the
securities, in a primary offering of securities of the undersigned
registrant pursuant to this registration statement, regardless of the
underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned registrant will be a seller to
the purchaser and will be considered to offer or sell such securities to
such purchaser,
|
|
(i)
|
Any
preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule
424;
|
|
(ii)
|
Any
free writing prospectus relating to the offering prepared by or on behalf
of the undersigned registrant or used or referred to by the undersigned
registrant;
|
|
(iii)
|
The
portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or its
securities provided by or on behalf of the undersigned registrant;
and;
|
|
(iv)
|
Any
other communication that is an offer in the offering made by the
undersigned registrant to the
purchaser.
|
(b)
|
The
undersigned registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the registrant’s
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee
benefit plan’s annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
|
(c)
|
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
|
(d)
|
(1) For
purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act will be deemed to be part of this
registration statement as of the time it was declared
effective.
|
|
(2)
|
For
the purpose of determining any liability under the Securities Act, each
post−effective amendment that contains a form of prospectus will be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time will be deemed
to be the initial bona fide offering
thereof.
|
(e)
|
The
undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance
with the rules and regulations prescribed by the SEC under Section
305(b)(2) of the Trust Indenture
Act.
|
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that
it has reasonable grounds to believe that it meets all of the requirements for
filing on Form S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Milwaukee, State of Wisconsin on October 5, 2009.
|
MERGE
HEALTHCARE INCORPORATED
|
|
|
|
|
By
|
/s/
Justin
C. Dearborn |
|
Name:
|
Justin
C. Dearborn
|
|
Title:
|
Chief
Executive Officer
|
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement
has been signed by the following persons in the capacities indicated on October
5, 2009.
Signature
|
|
Title
|
|
|
|
* |
|
Chairman
|
Michael
W. Ferro, Jr.
|
|
|
|
|
|
* |
|
Director
and Chief Executive Officer
|
Justin
C. Dearborn
|
|
|
|
|
|
* |
|
Director
|
Dennis
Brown
|
|
|
|
|
|
* |
|
Director
|
Gregg
G. Hartemayer
|
|
|
|
|
|
* |
|
Director
|
Richard
A. Reck
|
|
|
|
|
|
* |
|
Director
|
Neele
E. Stearns, Jr.
|
|
|
|
|
|
/s/ Steven M. Oreskovich |
|
Chief
Financial Officer and Attorney-in-Fact
|
Steven
M. Oreskovich
|
|
(principal
accounting officer)
|
|
|
|
*
Pursuant to Attorney-in-Fact
|
|
|