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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
May 1, 2007
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DIGIRAD CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 000-50789 33-0145723
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
13950 Stowe Drive
Poway, California 92064
(Address of principal executive offices, including zip code)
(858) 726-1600
(Registrant's telephone number, including area code)
N/A
(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
Effective May 1, 2007, Digirad Corporation acquired substantially all of the
assets of Ultrascan, Inc. ("Ultrascan") in exchange for cash consideration of
$7.25 million and the assumption of debt obligations of Ultrascan totaling $1.5
million pursuant to an Asset Purchase Agreement by and among Digirad
Corporation, Digirad Imaging Solutions, Inc, Digirad Ultrascan Solutions, Inc.,
Ultrascan and William "Mickey" King, Jr., the principal stockholder of
Ultrascan. The purchase price is subject to a working capital adjustment after
the closing of the transaction. Additional consideration, payable in cash and
common stock, of up to $3.85 million may be payable to Ultrascan or its
designees in the event that Ultrascan achieves certain EBITDA milestones over
the next four years.
A copy of a press release dated May 1, 2007, announcing this transaction is
attached hereto as Exhibit 99.1 to this current report.
This information and the exhibits hereto are being furnished and shall not be
deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or otherwise subject to the liability
of that section, nor shall they be deemed incorporated by reference in any
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
as expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits
The following exhibits are attached:
Exhibit No. Description
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99.1 Press Release dated May 1, 2007.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DIGIRAD CORPORATION
By:/s/ Todd Clyde
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Todd Clyde
Chief Financial Officer
Date: May 1, 2007
Exhibit 99.1
Digirad Acquires Ultrascan
POWAY, Calif.--(BUSINESS WIRE)--May 1, 2007--Digirad Corporation
(NASDAQ:DRAD), a leading provider of cardiovascular imaging services
and solid-state nuclear medicine imaging products to physician
offices, hospitals and imaging centers, announced today that it has
completed the acquisition of privately held Ultrascan, Inc., a leading
provider of mobile ultrasound and nuclear medicine services primarily
in Georgia, for $7.25 million in cash and the assumption of $1.5
million of debt, plus up to $3.85 million in cash and stock if
Ultrascan achieves certain EBITDA milestones over a four year period.
Ultrascan currently provides mobile ultrasound services to more than
100 clients through a 32-unit mobile fleet as well as fixed-site
nuclear imaging services at physician offices, clinics and hospitals
primarily in Georgia.
"We are pleased to welcome the Ultrascan team to the Digirad
family," said Mark Casner, Chief Executive Officer of Digirad. "This
transaction diversifies Digirad's services and expands our client
base. It is a first step in our strategy to create long-term growth by
leveraging and complementing Digirad's nuclear cardiology service
capabilities with other mobile imaging services. Ultrascan has
differentiated its services and added value to its well-established
operating platform by building a close working relationship with one
of the leading medical institutions in the Southeast. We believe this
is an important strategic asset that will enhance our competitiveness
in the Southeast market, and provides a model for our approach as we
expand in other areas."
Mickey King, President and CEO of Ultrascan, said, "We believe
that the combination of Ultrascan and Digirad creates growth
opportunities in both ultrasound and nuclear imaging, and will provide
added value to our combined customer base. Our experience in working
with Digirad during the past year has shown us that Ultrascan's mobile
imaging delivery capability and client base align well with Digirad's
nuclear cardiology services. We look forward to continuing to build
our business in combination with Digirad's strength and support."
About Digirad
Digirad Corporation develops, manufactures and markets
solid-state, digital gamma cameras to hospitals, imaging centers and
physician offices. Digirad offers a comprehensive line of solid-state
nuclear gamma cameras that produce high-quality images for use in the
detection of many medical conditions, including cardiovascular
disease. Digirad's cameras are unique as their lightweight and compact
design allows them to fit easily into small office spaces. Digirad's
wholly owned subsidiary, Digirad Imaging Solutions (DIS), offers a
comprehensive mobile imaging leasing and services program for
physicians who wish to perform in-office nuclear cardiology and
ultrasound procedures without purchasing the equipment. For more
information, please visit www.digirad.com. Digirad(R), Digirad Imaging
Solutions(R), and Cardius(R) are registered trademarks of Digirad
Corporation.
Forward-Looking Statements
Digirad cautions that statements included in this press release
that are not a description of historical facts are forward-looking
statements. You can identify these statements by the fact that they do
not relate strictly to historical or current facts and use words such
as "anticipate," "estimate," "expect," "project," "intend," "plan,"
"believe" and other words and terms of similar meaning in connection
with a discussion of future operating or financial performance or
events. Examples of such statements include the statements regarding
our expectations that Ultrascan acquisition will be complementary to
our DIS business and provides opportunities for the diversification of
our services, the expansion of our client base and the creation of
future growth; and our belief that a relationship with a leading
medical institution will enhance our competitiveness and provide an
expansion model. The inclusion of these and other forward-looking
statements should not be regarded as a representation by Digirad that
any of its plans will be achieved. Actual results may differ
materially from those set forth in this press release due to the risks
and uncertainties inherent in Digirad's business including, without
limitation: the degree to which personnel changes and related
disruptions in our business activities may affect Digirad's products,
customers, work force, suppliers, and our overall business prospects
and operations; the degree to which Digirad's camera systems and
related services will be accepted by physicians and hospitals some of
whom may experience reliability issues or technical problems; the
ability of Digirad effectively to market, sell and distribute its
medical devices, and related services given its limited capabilities
in these areas; Digirad's ability to manage risks relating to product
liability, warranty claims, recalls, property damage and personal
injury with respect to its imaging systems; and other risks detailed
in Digirad's Securities and Exchange Commission filings, including its
Annual Report on Form 10-K and other reports filed with the Securities
and Exchange Commission. Given these uncertainties, readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. All
forward-looking statements are qualified in their entirety by this
cautionary statement and Digirad undertakes no obligation to revise or
update this press release including the forward-looking statements
contained herein to reflect events or circumstances after the date
hereof or to update the reasons actual results could differ materially
from those anticipated in these forward-looking statements, even if
new information becomes available in the future.
CONTACT: Company Contact:
Digirad Corporation
Todd Clyde, CFO, 858-726-1600
ir@digirad.com
or
Investor Contact:
Neil Berkman Associates
310-826-5051
info@BerkmanAssociates.com