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As previously reported, on or about the signing of the merger agreement onJune 18, 2008, a group of investors led by Dr. Phillip Frost, Chairman andChief Executive Officer of Opko Health, Inc., invested approximately $13.0million in Cardo in exchange for units of Cardo's membership interests.Cardo used approximately $9.7 million of the proceeds from these investmentsto close on the acquisition of the remaining outstanding equity interests ofthree partially owned subsidiaries of Cardo (Accelerated Innovation, LLC,Cervical Xpand, LLC, and Uni-Knee, LLC), and Cardo expects to use theremaining funds to accelerate its research and product development.
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Under the terms of the merger agreement, at the closing of the merger,each Cardo unit issued and outstanding was converted into and exchanged forthe right to receive 667,204.70995 shares of common stock of CKST. As aresult of the merger, CKST's stockholders own approximately 5.5% of thecombined company on a fully diluted basis, the members of Cardo, excluding thenew investors, own approximately 64.8% of the combined company on a fullydiluted basis, the new investors own approximately 28.5% of the combinedcompany on a fully diluted basis, and option holders of Cardo ownapproximately 1.2% of the combined company on a fully diluted basis.
In connection with the consummation of the merger, CKST expects to changeits name from "clickNsettle.com, Inc." to "Cardo Medical, Inc." CKST'strading symbol is "CKST.OB," which the company expects to change in connectionwith the name change. CKST intends to apply to have its shares listed on theAmerican Stock Exchange.
In addition, on the tenth day after filing and transmitting an InformationStatement pursuant to Section 14(f) of the Securities Exchange Act of 1934 andRule 14f-1 thereunder (approximately September 12, 2008), the Board ofDirectors of Cardo initially will consist of five directors to be appointed byDr. Andrew Brooks and two directors to be appointed by Dr. Frost. Dr. Brooks,an orthopedic surgeon, will serve as Chief Executive Officer of the combinedcompany and as its Chairman of the Board. The company is now headquartered inLos Angeles, California.
Dr. Brooks commented, "We are pleased to have completed our merger, andare excited to be working with Dr. Frost and his group as we grow our companyinto a significant and important source of innovative product development anddistribution for orthopedic reconstructive and spine surgical devices. I ampersonally excited and grateful to be in a business which offers the abilityto improve the quality of life and functional abilities of so many patients."
Dr. Frost added, "We are thrilled to partner with the management team ofCardo Medical and look forward to working with them as they build theirexciting company into a world class orthopedic and spinal device business."
Glenn L. Halpryn, who is the current chairman and president of CKST,stated, "The Board of Directors of ClickNSettle is very impressed with themanagement team of Cardo, which combines orthopedic surgical expertise withbusiness development acumen. Cardo is creating innovative orthopedic productswith the potential to improve patient outcomes, while offering operationalbenefits to the providing orthopedic surgeons. Cardo has an established,proprietary product portfolio, and has already demonstrated numerous promisingproduct development cycles
