PRA Health Sciences,Inc. (NASDAQ:PRAH) Files An 8-K Entry into a Material Definitive AgreementItem 1.01. Entry into a Material Definitive Agreement.
On August3, 2017, Pharmaceutical Research Associates,Inc., a Virginia corporation (“PRA”) and a wholly-owned subsidiary of PRA Health Sciences,Inc. (the “Company”), Skyhook Merger Sub,Inc., a newly formed Delaware corporation and a wholly-owned subsidiary of PRA (“Merger Sub”), Symphony Health Solutions Corporation, a Delaware corporation (“Symphony Health”), and STG III, L.P., a Delaware limited partnership, solely in its capacity as the representative (the “Sellers Representative”) of holders of Symphony Health’s capital stock and stock options, entered into an Agreement and Plan of Merger (the “Merger Agreement”).
to the terms of the Merger Agreement, subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Merger Sub will be merged with and into Symphony Health (the “Merger”), and Symphony Health will become a wholly-owned subsidiary of PRA at the effective time of the Merger (the “Effective Time”). At the Effective Time, PRA will pay $530 million in cash for the outstanding equity of Symphony Health, which amount is subject to adjustment for customary purchase price adjustments.
to the Merger Agreement, following the Effective Time, PRA may be required to make additional payments to the prior equity holders of Symphony Health to an earnout provision that is based on Symphony Health exceeding financial targets for the twelve month periods ending December2017 and December2018.
The Merger Agreement includes customary representations, warranties and covenants by the parties. Symphony Health has agreed, among other things, to operate its business in the ordinary course until the Merger is consummated. In addition, certain covenants require each of the parties to use reasonable best efforts to cause the Merger to be consummated.
Consummation of the Merger is subject to various customary closing conditions, including, (i)the expiration or early termination of the waiting period applicable to the Merger under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, (ii)the absence of any law, injunction, judgment or ruling enjoining or prohibiting the Merger, (iii)the accuracy of the representations and warranties made by the parties to the Merger Agreement, and (iv)the performance by the parties in all material respects of their covenants, obligations and agreements under the Merger Agreement. Consummation of the Merger is not subject to any financing contingencies.
The Merger Agreement contains customary termination rights, including that either party to the Merger Agreement, subject to certain exceptions and limitations, may terminate the Merger Agreement if the Merger is not consummated by October31, 2017.
The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is filed as Exhibit2.1 to this Current Report on Form8-K and is incorporated herein by reference.
The Merger Agreement has been included to provide investors and stockholders with information regarding its terms. It is not intended to provide any other factual information about Symphony Health, PRA, Merger Sub and the Sellers Representative. The Merger Agreement contains representations and warranties that the parties made to and solely for the benefit of each other. The assertions embodied in the representations and warranties in the Merger Agreement are qualified by information contained in the confidential disclosure letter that Symphony Health delivered to PRA in connection with signing the Merger Agreement. This confidential disclosure letter contains information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Merger Agreement. Investors are not third-party beneficiaries under the Merger Agreement and should not rely on such representations and warranties as characterizations of the actual state of facts or circumstances. Moreover, information concerning the subject matter of such representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in any public disclosures.
Concurrently and in connection with entering into the Merger Agreement, PRA entered into a debt commitment letter with PNC Bank, National Association (“PNC”), dated as of August3, 2017, to which, subject to the conditions set forth therein, PNC committed to provide to PRA up to $550 million of senior secured term loans that will become incremental term loans under PRA’s existing credit facility, for the purposes of paying the consideration under the Merger Agreement. The debt commitment letter expires on the earliest of November7, 2017, the consummation of the Merger and the termination of the Merger Agreement.
