WBMD Webmd Health Corp

Item 2.01. Completion of Acquisition or Disposition of Assets.

The Offer and all withdrawal rights thereunder expired at 5:00 p.m., New York City time, on September 14, 2017. American Stock Transfer & Trust Co., LLC, as the Depositary and Paying Agent (the “Depositary and Paying Agent”), advised that, as of the Expiration Date, a total of 30,583,187 Shares had been validly tendered into and not withdrawn from the Offer (not including 2,392,131 Shares tendered by Notice of Guaranteed Delivery), representing approximately 78.69% of the then issued and outstanding Shares (including restricted shares) of WebMD. The number of Shares tendered satisfied the Minimum Condition (as defined in the Merger Agreement and the Offer). All Offer Conditions having been satisfied or waived, the Purchaser accepted for payment all Shares validly tendered into and not withdrawn from the Offer and payment for such Shares was made to the Depositary and Paying Agent on September 15, 2017.

As a result of its acceptance of the Shares tendered into the Offer, the Purchaser acquired sufficient Shares to consummate the Merger pursuant to Section 251(h) of the Delaware General Corporation Law of the State of Delaware (“DCGL”) without a vote or any further action by the stockholders of WebMD.  Accordingly, on September 15, 2017, pursuant to the terms of the Merger Agreement and Section 251(h) of the DCGL, the Merger was consummated by Purchaser being merged with and into WebMD, with WebMD surviving as a wholly-owned subsidiary of Parent. Each Share issued and outstanding immediately prior to the effective time of the Merger (the “Effective Time”) (other than Shares held in the treasury of WebMD or owned by any direct or indirect wholly-owned subsidiary of WebMD and Shares owned by Parent, the Purchaser or any direct or indirect wholly-owned subsidiary of Parent, or by any stockholders of WebMD who have properly exercised their appraisal rights under Section 262 of the DGCL) was cancelled and converted into the right to receive an amount in cash equal to the Offer Price, without interest and less any applicable withholding taxes.

Pursuant to the Merger Agreement, each option granted under a Company equity plan that was outstanding, vested and exercisable immediately prior to the Effective Time, and for which the Offer Price exceeded the exercise price of such option, was automatically cancelled as of the Effective Time, and in consideration of such cancellation, the holder thereof is entitled to receive immediately after the Effective Time, but in no event later than five (5) calendar days after the Effective Time, a cash payment in an amount equal to the excess of the Offer Price over the exercise price of each such option multiplied by the aggregate number of Shares issuable upon exercise of such option. Each other option granted under a Company equity plan that was outstanding immediately prior to the Effective Time was converted into the right of the holder to receive a cash payment equal, subject to the same vesting and acceleration terms and conditions,  to the excess of the Offer Price over the exercise price of each such option multiplied by the aggregate number of Shares subject to such option that would have vested on each applicable vesting date, which will become payable on the first payroll date following each such applicable vesting date.

 

Pursuant to the Merger Agreement, each restricted stock, performance-based restricted share and restricted stock unit granted under a Company equity plan that was outstanding and vested immediately prior to the Effective Time, was automatically cancelled as of the Effective Time, and in consideration of such cancellation, the holder thereof is entitled to receive immediately after the Effective Time, but in no event later than five (5) calendar days after the Effective Time, a cash payment in an amount equal to the Offer Price multiplied by the aggregate number of Shares subject to such restricted stock, performance-based restricted share (assuming maximum performance of performance criteria) or restricted stock unit. Each other restricted stock, performance-based restricted share and restricted stock unit granted under a Company equity plan that was outstanding immediately prior to the Effective Time was converted into the right of the holder to receive a cash payment, subject to the same vesting and acceleration terms and conditions (provided that the performance vesting criteria will no longer apply to the performance-share restricted cash), equal to the Offer Price multiplied by the aggregate number of Shares subject to such restricted stock, performance-based restricted share (assuming maximum performance of performance criteria) or restricted stock unit that would have vested on each applicable vesting date, which will become payable on the first payroll date following each such applicable vesting date.

The aggregate purchase price paid to WebMD’s stockholders in the Offer and the Merger was approximately $2.54 billion. The aggregate purchase price and related fees and expenses were funded by proceeds from debt financing, as well as by an equity contribution from investment funds affiliated with Kohlberg Kravis Roberts & Co. L.P. (the “KKR Funds”) and certain other investors.

The foregoing summary description of the Merger Agreement and related transactions does not purport to be complete and is qualified in its entirety by reference to the terms of the Merger Agreement, which is filed as Exhibit 2.1 hereto and is incorporated herein by reference.