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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: JUNE 13, 2006
(Date of earliest event reported)
ATS MEDICAL, INC.
(Exact name of registrant as specified in its charter)
Commission File Number: 0-18602
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MINNESOTA 41-1595629
(State or other jurisdiction of incorporation) (IRS Employer Identification No.)
3905 ANNAPOLIS LANE N.
MINNEAPOLIS, MINNESOTA 55447
(Address of principal executive offices, including zip code)
(763) 553-7736
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
As previously disclosed, on January 23, 2006, ATS Medical, Inc. (the
"Company") entered into an Agreement and Plan of Merger (the "Merger Agreement")
with Seabiscuit Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of the Company, 3F Therapeutics, Inc., a Delaware corporation ("3F"),
and Boyd D. Cox, as stockholder representative. The Merger Agreement provides
that Seabiscuit Acquisition Corp. will merge with and into 3F, and 3F will
become a wholly owned subsidiary of the Company (the "Merger").
On June 7, 2006, Arthur N. Abbey ("Abbey") filed in the Court of Chancery of
the State of Delaware a summons and complaint against Theodore C. Skokos, a
director of 3F ("Skokos") and 3F, alleging, among other things, fraud and breach
of fiduciary duties in connection with the purchase by Abbey of certain
securities of 3F Partners Limited Partnership II (an investment fund unrelated
to 3F), which is a major 3F stockholder (the "June 2006 Complaint").
On June 13, 2006, the Company entered into an amendment to the Merger
Agreement (the "Amendment") with Seabiscuit Acquisition Corp., 3F and Boyd D.
Cox. The Amendment extends the termination date of the Merger Agreement from
June 15, 2006 to August 31, 2006. In addition, the Amendment:
- provides for express indemnification by 3F stockholders of all damages
incurred by the Company arising out of the June 2006 Complaint and the
other complaint which was previously disclosed in the Current Report on
Form 8-K filed by the Company on February 9, 2006, both of which were
filed by Abbey against 3F and Skokos (the "Complaints");
- amends Exhibit B to the Merger Agreement, which details the operating
budget of 3F, to reflect increases in certain 3F operating expenses for
the months of June, July and August of 2006;
- provides that, assuming the Company decides to waive 3F's non-compliance,
if any, with the closing condition requiring all 3F option holders to
either terminate or exercise their options in accordance with the Merger
Agreement, as amended, the Company has the right to reserve for future
issuance, from the shares of Company common stock that would otherwise
have been paid at the closing of the Merger, that number of shares of the
Company's common stock that would have been payable to 3F stock option
holders had such holders exercised their options in full in accordance
with the requirements of the Merger Agreement; and
- increases the number of shares of the Company's common stock to be placed
in escrow from 900,000 to 1,400,000, thereby reducing the total number of
shares of the Company's common stock to be issued at closing of the merger
to a maximum of 7,600,000 shares.
In the Amendment, the Company expressly acknowledges that, on the date of
execution of the Amendment, certain officers of the Company do not have any
actual knowledge of any breach by 3F of any representations and warranties
contained in the Merger Agreement other than the Complaints. Notwithstanding
this acknowledgement, however, the Company reserves its: (1) right to seek
indemnification for all breaches, including the Complaints, arising prior to the
execution of the Amendment, (2) indemnification rights and its rights to
terminate the Merger Agreement if facts and circumstances arise subsequent to
the execution of the Amendment that, in combination with the facts and
circumstances actually known by the Company prior to execution of the Amendment,
constitute a material breach of the Merger Agreement, and (3) rights of any
nature with respect to the Complaints and with respect to the 3F stock options
that are not terminated or exercised in accordance with the Merger Agreement and
the Amendment. None of the provisions contained in the Amendment reduce the
total merger consideration that may be paid to the stockholders of 3F in
connection with the Merger, which remains up to 9,000,000 shares of the
Company's common stock payable as initial merger consideration and up to
10,000,000 shares of the Company's common stock payable upon achievement of
certain milestones.
The above description of the Amendment is qualified in its entirety by
reference to the attached copy the Amendment, which is incorporated herein by
reference. A copy of the press release announcing the Amendment is also included
as an exhibit to this report and is incorporated herein by reference. A copy of
the Merger Agreement was attached as Exhibit 10.1 to the Current Report on Form
8-K filed by the Company with the Securities Exchange Commission on January 26,
2006.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits
2.1 Amendment No. 1 to Agreement and Plan of Merger, dated as of June
13, 2006, by and among ATS Medical, Inc., Seabiscuit Acquisition
Corp., 3F Therapeutics, Inc. and Boyd D. Cox, as stockholder
representative.
99.1 Press Release, dated June 19, 2006, of ATS Medical, Inc.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ATS MEDICAL, INC.
By: /s/ Michael D. Dale
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Michael D. Dale
Chief Executive Officer
Date: June 18, 2006
EXHIBIT INDEX
2.1 Amendment No. 1 to Agreement and Plan of Merger, dated as of June 13,
2006, by and among ATS Medical, Inc., Seabiscuit Acquisition Corp., 3F
Therapeutics, Inc. and Boyd D. Cox, as stockholder representative.
99.1 Press Release, dated June 19, 2006, of ATS Medical, Inc.