UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: February 23, 2006
(Date of earliest event reported)
ORTHOLOGIC CORP.
(Exact name of Company as specified in its charter)
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| Delaware
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000-21214
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86-0585310 |
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.) |
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| 1275 West Washington Street, Tempe, Arizona
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85281 |
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| (Address of principal executive offices)
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(Zip Code) |
Company’s telephone number, including area code:
(602) 286-5520
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the Company under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c)) |
Section 1 – Company’s Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On February 23, 2006, OrthoLogic Corp. (the “Company”) entered into an Asset Purchase
Agreement and Plan of Reorganization (the “Definitive Agreement”) to acquire certain assets and
certain liabilities of AzERx, Inc. (“AzERx”) for $390,000 in cash and the issuance of 1,325,000
shares of the Company’s common stock, with a market value of $7.5 million based on the closing
share price on the date the Definitive Agreement was entered into. Pursuant to the terms of the
Definitive Agreement, the Company acquired an exclusive license for the core intellectual property
relating to AzERx’s lead compound, AZX100, a 24-amino acid peptide. AZX100 is currently being
investigated for several applications, including the treatment of vasospasm associated with
subarachnoid hemorrhage, prevention of keloid scarring, and treatment of asthma. In addition, the
Company agreed to issue 30,000 shares of its common stock to Arizona Science and Technology
Enterprises, LLC (“AzTE”), the licensor of AzERx’s core technology patents, in connection with
certain modifications of the license effective upon consummation of the transactions contemplated
in the Definitive Agreement. The transaction closed February 27, 2006.
The Chairman of the Company’s Board of Directors (the “Board”), John M. Holliman III, is a
member of the AzERx board of directors and is affiliated with Valley Ventures III, L.P., an
investment fund that owned approximately 30% of AzERx’s fully diluted equity at the time of the
transaction. Mr. Holliman recused himself from all Board matters involving AzERx, including the
analysis of AzERx as a potential target of acquisition for the Company, and subsequent negotiations
between the Company and AzERx. Mr. Holliman was not present during the deliberations and vote of
the Board approving the Definitive Agreement and the transactions contemplated thereby.
Item 3.02 Unregistered Sale of Equity Securities
As more fully described in Item 1.01 above, the Company closed the transactions contemplated
by the Definitive Agreement on February 27, 2006 (the “Closing Date”). Pursuant to the Definitive
Agreement and related agreements with AzTE, on the Closing Date, the Company issued a total of
1,355,000 shares of its common stock to AzERx and AzTE as partial consideration for the acquisition
of substantially all of the assets of AzERx and modifications of the AzTE license. The issuance of
shares to AzERx and AzTE was made in reliance upon an exemption from the registration provisions of
the Securities Act of 1933, as amended (the “Securities Act”), set forth in Section 4(2) and Rule
506 of Regulation D promulgated under the Securities Act, for sales by an issuer not involving any
public offering to accredited investors (as defined in Regulation D) and no more than 35 other
persons, all of whom had a purchaser representative (as defined in Regulation D) to represent them
in the transaction.