<PAGE>
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 8-K/A
Amendment No. 1
Current Report Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 9, 1997
SYNBIOTICS CORPORATION
(Exact name of registrant as specified in its charter)
Commission file number 0-11303
California 95-3737816
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
11011 Via Frontera
San Diego, California 92127
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (619) 451-3771
===============================================================================
<PAGE>
AMENDMENT TO CURRENT REPORT
The Registrant's Current Report on Form 8-K, filed on July 24, 1997 to report
the Registrant's acquisition on July 9, 1997 of the veterinary diagnostic
business of Rhone Merieux S.A.S. is amended to provide financial statements, pro
forma financial information and additional exhibits required by Item 7 of the
report. There are no other changes to the report as filed.
Item 7. Financial Statements and Exhibits
---------------------------------
<TABLE>
<C> <S> <C>
a) Financial statements of business acquired:
------------------------------------------
Report of Independent Accountants 2
Statement of Assets as of December 31, 1996 10
Statement of Revenues and Direct Operating Expenses
for the years ended December 31, 1995 and 1996 11
Notes to Statement of Assets and Statement of Revenues
and Direct Operating Expenses 12
Statement of Assets (Unaudited) as of June 30, 1997 13
Statement of Revenues and Direct Operating Expenses
(Unaudited) for the six months ended June 30, 1997 14
Notes to Unaudited Statement of Assets and Unaudited
Statement of Revenues and Direct Operating Expenses 15
</TABLE>
-1-
<PAGE>
Madame Dominique TAKIZAWA
Corporate VP Finance
RHONE-MERIEUX SA
29, avenue Tony Garnier
69007 - LYON
RHONE-MERIEUX SA DIAGNOSTIC BUSINESS
SPECIAL AUDIT REPORT
1. We have audited, in accordance with generally accepted auditing standards,
the statutory financial statements of Rhone-Merieux SA for the year ended
December 31, 1995 and have issued our report hereon dated February 5, 1996.
We have audited the financial statements of Rhone-Merieux SA for the year
ended December 31, 1996, prepared for the purpose of the Rhone-Poulenc
consolidation for the year then ended, but have not yet issued our report
on the Rhone-Merieux SA statutory accounts for this year ended December 31,
1996. We also have audited the revenues and direct costs of the Rhone-
Merieux SA diagnostic business for the years ended December 31, 1996 and
1995 and its fixed assets and inventories as of December 31, 1996,
presented on the attached schedules. These schedules are the
responsibility of Rhone-Merieux SA's management. Our responsibility is to
express an opinion on the Rhone-Merieux SA diagnostic business' revenues,
direct costs, fixed assets and inventories, based on our audit procedures.
2. These audit procedures were conducted in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance whether revenues, direct costs,
together with fixed assets and inventories, are free of material
misstatements. These audit procedures include examining, on a test basis,
evidence supporting the amounts and also assessing the accounting
principles used and significant estimates made by management. We believe
that our audit procedures provide a reasonable basis for our opinion.
3. In our opinion, the attached schedules present fairly, in all material
respects, the Rhone-Merieux SA diagnostic business revenues and direct
costs for the years ended December 31, 1996 and 1995, and its fixed assets
and inventories as of December 31, 1996.
4. At your request, we also have reviewed:
i) The allocation of fixed costs, selling and other overheads and research
and development costs related to the Rhone-Merieux SA diagnostic business
for the years ended December 31, 1996 and 1995, and presented on the
attached schedules.
ii) Accounts receivable and payable related to the diagnostic business as
of December 31, 1996.
5. Our review was made solely to assess the reasonableness of the amounts
concerned and of the method adopted for allocating fixed costs and non
direct costs to the diagnostic business and for estimating accounts
receivable and payable. It does not constitute an audit conducted in
accordance with generally accepted auditing standards. Our procedures and
findings are as follows:
i) Fixed costs (factory overheads)
We made sure that only fixed costs relating to manufacturing sections
concerned by the diagnostic business were allocated to this activity.
These costs have been allocated proportionally to the added value of the
diagnostic business compared to the whole Rhone-Merieux SA biology added
value. In particular, we have
-2-
<PAGE>
made sure that the fixed costs allocated were not affected by the
pharmaceuticals (Toulouse) and Frontline activities. We reperformed some
calculations on a test basis and did not notice any significant exceptions
or errors.
ii) Selling overheads
We made sure that all costs specific to the diagnostic business were
allocated directly to this business line. They correspond to technical
assistance, marketing, and advertising expenses. Other costs such as
salesmen, distribution expenses, administrative expenses, receivables
depreciation costs, fixed assets depreciation were allocated proportionally
to the diagnostic business revenues compared to the total Rhone-Merieux SA
revenues. We reperformed some calculations on a test basis and did not
notice any significant errors.
iii) Other overheads
These costs have been allocated proportionally to the added value of the
diagnostic business compared to the whole Rhone-Merieux SA biology added
value. Since this diagnostic business has never been operated as a
separate operational or legal entity, no better approach could be
considered.
iv) Research and development costs
Costs specific to the diagnostic business research and development have
been identified and amount to FF'OOO 5,835 and FF'OOO 6,145 for years 1996
and 1995, respectively. We examined documentation supporting this direct
allocation. Other R&D costs, FF'OOO 1,068 and FF'OOO 1,154 for years 1996
and 1995 respectively, have been allocated proportionally to the number of
the R&D employees pertaining to the diagnostic business. We reviewed the
method followed and reperformed some calculation on a test basis and did
not notice any significant errors or irregularities.
v) Accounts receivable and payable
Rhone-Merieux SA does not record receivables and payables related to the
diagnostic business separately. Thus, the corresponding amounts as of
December 31, 1996 included in the attached schedules have been estimated
based on receivable turnover ratios and payable purchase ratios. The
amounts determined thanks to that method are rough estimates and should
only be regarded as such.
6. Because the above procedure on fixed and non-direct costs and on accounts
receivable and payable do not constitute an audit conducted in accordance
with generally accepted auditing standards, we do not express an opinion on
the accounts or items referred to above.
7. In connection with the procedures referred to above, except as indicated in
paragraph 8 hereafter, no matters came to our attention that caused us to
believe the specified fixed costs or non-direct costs should be adjusted.
8. The Rhone-Merieux SA diagnostic business has never been operated as a
separate operational or legal entity. Thus, we were unable to ascertain
that the figures included in the attached schedules include all costs, and
only those costs, necessary for operating this business as a stand alone.
Moreover the method used for allocating some non-direct costs,
proportionally to the diagnostic business added value or number of
employees, necessarily implies that those costs are affected by the global
activity level of Rhone-Merieux SA and thus might fluctuate depending on
the degree of absorption of the Rhone-Merieux SA total fixed costs and non-
direct costs. These are the limits of the method adopted, but in the
circumstances, there was no better way of allocating these categories of
costs.
-3-
<PAGE>
9. Paragraphs 5 to 8 hereabove relate only to the accounts and items specified
above (paragraph 4) and do not extend to any financial statement of Rhone-
Merieux SA taken as a whole.
Lyon, February 14, 1997
Coopers & Lybrand Audit
Bernard R. Rascle
Partner
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<PAGE>
Schedule 1
----------
RHONE-MERIEUX SA DIAGNOSTIC BUSINESS
OPERATING RESULTS
-----------------
For the years ended December 31, 1996 and 1995
----------------------------------------------
<TABLE>
<CAPTION>
(in French francs Thousands) 1996 1995
<S> <C> <C>
Revenues 58,514 59,844
Direct Selling expenses (1,355) (1,415)
Direct costs of sales (18,921) (20,842)
Royalties (786) (318)
Gross margin after direct costs 37,452 37,269
Reviewed but non-audited Reviewed but non-audited Reviewed but non-audited
Fixed costs (1) (4,060) (4,734)
Gross margin 33,392 32,535
Selling overheads (2) (14,289) (14,122)
Other overheads (1) (4,701) (5,512)
Research and development costs (3) (6,903) (7,299)
Operating profit 7,499 5,602
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Part of these costs has been allocated proportionally to the added value of
the diagnostic business compared to the whole Rhone-Merieux SA biological
activity added value.
(2) Allocated proportionally to the net sales of the diagnostic business
compared to the total net sales of Rhone-Merieux SA.
(3) Part of these costs has been allocated proportionally to the number of the
R&D employees pertaining to the diagnostic business compared to the total
number of employees working in the Rhone-Merieux SA R&D department.
-5-
<PAGE>
Schedule 2
----------
RHONE-MERIEUX SA DIAGNOSTIC BUSINESS
FIXED ASSETS AND SOME SHORT TERM ASSETS AND LIABILITIES
-------------------------------------------------------
As of December 31, 1996
-----------------------
<TABLE>
<CAPTION>
(in French francs Thousand)
<S> <C>
* Fixed assets
Gross value : 6,280
Depreciation : 5,273
-----
Net book value: 1,007
* Inventories
Net book value: 14,964
* Accounts receivable (non-audited)
Accounts receivable as at December 31, 1996 : 8,811
* Accounts payable (non-audited)
Accounts payable as at December 31, 1996: 2,284
</TABLE>
-6-
<PAGE>
Schedule 3
----------
RHONE MERIEUX SA DIAGNOSTIC BUSINESS
OPERATING RESULTS
-----------------
For the year ended December 31, 1996
------------------------------------
BREAK OUT OF EXPENSES AND REVENUES BETWEEN
------------------------------------------
DIRECT AND INDIRECT
-------------------
<TABLE>
<CAPTION>
(in French francs thousands) Specific to the RM Allocated to the RM Total
diagnostic business diagnostic business
<S> <C> <C> <C>
Net sales Trade 58,514 58,514
Direct selling expenses 1,355 1,355
Raw materials 14,781 14,781
Depreciation 322 322
Added value 3,818 3,818
------ ------
Direct cost of sales 18,921 18,921
Royalties 786 786
Gross margin on direct costs 38,807 (1,355) 37,452
Reviewed but non-audited Reviewed but non-audited
Fixed costs (factory 890 3,170 (1) 4,060
overheads)
Gross margin 37,917 (4,525) 33,392
Selling overheads 5,962 8,327 (2) 14,289
Other overheads - 4,701 (1) 4,701
R & D 5,835 1,068 (3) 6,903
Operating profit 26,120 (18,621) 7,499
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Allocated proportionally to the added value of the diagnostic business
compared to the whole Rhone-Merieux SA biological activity added value.
(2) Allocated proportionally to the net sales of the diagnostic business
compared to the total net sales of Rhone-Merieux SA.
(3) Allocated proportionally to the number of the R&D employees of the
diagnostic business compared to the total number of employees in the Rhone-
Merieux SA R&D department.
-7-
<PAGE>
Schedule 4
RHONE-MERIEUX SA DIAGNOSTIC BUSINESS
OPERATING RESULTS
-----------------
For the year ended December 31, 1996
------------------------------------
BREAK OUT OF SPECIFIC EXPENSES AND REVENUES BETWEEN
---------------------------------------------------
RHONE-MERIEUX SA AND SUBSIDIARIES
---------------------------------
<TABLE>
<CAPTION>
(in French francs thousands) RM SA RM Subsidiaries Total
<S> <C> <C> <C>
Net sales trade 24,783 33,731 58,514
Raw materials 4,373 10,408 14,781
Depreciation 261 61 322
Added value 3,061 757 3,818
------ ------ ------
Direct cost of sales 7,695 11,226 18,921
Royalties 786 - 786
Gross margin on direct costs 16,302 22,505 38,807
Fixed costs (factory 890 - 890
overheads)
Gross margin 15,412 22,505 37,917
Selling overheads (schedule 5) 4,362 1,600 5,962
Other overheads - - -
R&D (schedule 5) 5,835 - 5,835
Operating profit 5,215 20,905 26,120
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
-8-
<PAGE>
Schedule 5
----------
RHONE-MERIEUX SA DIAGNOSTIC BUSINESS
OPERATING RESULTS
-----------------
For the year ended December 31, 1996
------------------------------------
ANALYSIS OF SELLING OVERHEADS AND
---------------------------------
RESEARCH AND DEVELOPMENT COST
-----------------------------
<TABLE>
<CAPTION>
(in French francs Thousands) Selling overheads Research & Development
<S> <C> <C>
Wages and salaries 2,776 2,430
Travel expenses 646 196
Advertising expenses 279 -
R&D services rendered by other Rhone-Merieux SA - 2,376
departments
Other 661 833
Total (as per schedule 4) 4,362 5,835
- ------------------------------------------------------------------------------------------------------------
</TABLE>
-9-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Statement of Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
December 31,
1996
----
<S> <C>
Inventories $2,885,000
Property, plant and equipment, net 194,000
----------
Total assets $3,079,000
==========
</TABLE>
See accompanying notes to financial statements.
-10-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Statement of Revenues and Direct Operating Expenses
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------
1996 1995
---- ----
<S> <C> <C>
Revenues $11,735,000 $11,729,000
Direct operating expenses:
Cost of sales 5,015,000 4,606,000
Research and development 1,431,000 1,384,000
Selling and marketing 3,109,000 3,293,000
General and administrative 1,081,000 942,000
----------- -----------
10,636,000 10,225,000
----------- -----------
Excess of revenues over direct operating expenses $ 1,099,000 $ 1,504,000
=========== ===========
</TABLE>
See accompanying notes to financial statements.
-11-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Notes to Statement of Assets and Statement of Revenues and Direct Operating
- ---------------------------------------------------------------------------
Expenses
- --------
Note 1 - Business and Asset Purchase Agreement:
The Rhone-Merieux SA diagnostic business (the "Business") is a veterinary
diagnostic product line which is manufactured (however, certain small animal
diagnostic products are manufactured under contract by a third party), sold and
distributed by Rhone Merieux S.A.S. (the "Company"). Effective July 9, 1997, the
Company sold the Business to Synbiotics Corporation pursuant to purchase
agreements dated May 14, 1997 and amended July 9, 1997. The assets acquired
included inventory, property, plant and equipment and the rights to manufacture,
sell and distribute the product line.
Note 2 - Summary of Significant Accounting Policies:
Inventories
Inventories are stated at the lower of cost (first in, first out method) or
market.
Property and Equipment
Property and equipment are stated at cost. Depreciation is computed using the
straight line method over the estimated useful lives of the related assets.
Note 3 - Basis of Presentation:
The accompanying statement of assets and statement of revenues and direct
operating expenses (the "Statements") have been prepared in accordance with
generally accepted accounting principles and were derived from Schedules 1 and 2
of the Rhone-Merieux SA Diagnostic Business Special Audit Report (the"Report")
contained elsewhere in this Form 8-K/A. The Report presents financial data in
French francs. The Statements have been converted to U.S. dollars using the
appropriate foreign currency exchange rates in effect for the periods presented.
Complete financial statements were not prepared as the Company did not maintain
the Business as a separate business unit and has not segregated indirect
operating cost information or related assets and liabilities (other than
inventory and property, plant and equipment) for this product line in its
accounting records. It is not practical to attempt to reconstruct and separate
the indirect operating costs and other related assets and liabilities applicable
to this product line.
The Statements include the assets of the Company which are directly related to
the Business and which have been historically segregated by the Company in its
accounting records. The Statements do not include cash, accounts receivable,
prepaid or other assets, accounts payable, accrued expenses, borrowings or any
other assets or liabilities.
The Statements include the revenues and direct operating expenses directly
attributable to the manufacture, sale and distribution of the product line
comprising the Business sold and have been historically segregated by the
Company in its accounting records. The Statements also include an allocation of
certain expenses directly attributable to the manufacture, sale and distribution
of the product line and an allocation of research and development and general
and administrative expenses as discussed in the Report. Management believes
that the above expense allocations are reasonable for the purpose of these
Statements; however, there can be no assurances that such allocations will be
indicative of future results of operations.
-12-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Statement of Assets (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
June 30,
1997
----
<S> <C>
Accounts receivable $ 917,000
Inventories 2,062,000
Property, plant and equipment, net 236,000
----------
Total assets $3,215,000
==========
</TABLE>
See accompanying notes to financial statements.
-13-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Statement of Revenues and Direct Operating Expenses (Unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended June 30,
1997
----
<S> <C>
Revenues $5,760,000
----------
Direct operating expenses:
Cost of sales 2,027,000
Research and development 518,000
Selling and marketing 587,000
----------
3,132,000
----------
Excess of revenues over direct operating expenses $2,628,000
==========
</TABLE>
See accompanying notes to financial statements.
-14-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Notes to Unaudited Statement of Assets and Unaudited Statement of Revenues and
Direct Operating Expenses
- -------------------------------------------------------------------------------
Note 1 - Business and Asset Purchase Agreement:
The Rhone-Merieux SA diagnostic business (the "Business") is a veterinary
diagnostic product line which is manufactured (however, certain small animal
diagnostic products are manufactured under contract by a third party), sold and
distributed by Rhone Merieux S.A.S. and R.M.- Diagnostics S.A.S., a wholly-owned
subsidiary of Rhone Merieux S.A.S., (collectively the "Company"). Effective July
9, 1997, the Company sold the Business to Synbiotics Corporation pursuant to
purchase agreements dated May 14, 1997 and amended July 9, 1997. The assets
acquired included accounts receivable, inventory, fixed assets and the rights to
manufacture, sell and distribute the product line.
Note 2 - Summary of Significant Accounting Policies:
Inventories
Inventories are stated at the lower of cost (first in, first out method) or
market.
Property and Equipment
Property and equipment are stated at cost. Depreciation is computed using the
straight line method over the estimated useful lives of the related assets.
Note 3 - Basis of Presentation:
The accompanying unaudited statement of assets and unaudited statement of
revenues and direct operating expenses (the "Statements") have been prepared in
accordance with generally accepted accounting principles and were derived from
historical accounting records of the Company. The interim data includes all
adjustments, consisting only of normal recurring adjustments, necessary for the
fair presentation of the results for the interim period; however, the interim
period does not include any allocation of overhead expenses as it is impractical
for the Company to provide the necessary data. Complete financial statement
were not prepared as the Company did not maintain the Business as a separate
business unit and has not segregated indirect operating cost information or
related assets and liabilities (other than inventory and property, plant and
equipment) for this product line in its accounting records. It is not practical
to attempt to reconstruct and separate the indirect operating costs and other
related assets and liabilities applicable to this product line.
The Statements include the assets of the Company which are directly related to
the Business and which have been historically segregated by the Company in its
accounting records. The Statements do not include cash, prepaid or other assets,
accounts payable, accrued expenses, borrowings or any other assets or
liabilities. The accounts receivable represent amounts owed to R.M.-Diagnostics
S.A.S. for inventory sold to Rhone Merieux S.A.S. who is acting as R.M.-
Diagnostics S.A.S's. distributor.
-15-
<PAGE>
Rhone-Merieux SA Diagnostic Business
Notes to Unaudited Statement of Assets and Unaudited Statement of Revenues and
Direct Operating Expenses
- ------------------------------------------------------------------------------
The Statements include the revenues and direct operating expenses directly
attributable to the manufacture, sale and distribution of the product line
comprising the Business sold and have been historically segregated by the
Company in its accounting records.
-16-
<PAGE>
b) Pro forma financial information
-------------------------------
The following unaudited pro forma condensed balance sheet as of June 30,
1997 and the unaudited pro forma condensed statements of operations for
the year ended December 31, 1996 and the six months ended June 30, 1997
giving effect to the acquisition of the worldwide veterinary diagnostic
business of Rhone Merieux S.A.S. (the "Rhone Merieux Diagnostic Business")
as of June 30, 1997 for the condensed balance sheet and as of January 1,
1996 for the condensed statements of operations. The pro forma condensed
financial statements are based on historical financial statements of
Synbiotics Corporation and Rhone Merieux Diagnostic Business, giving
effect to the acquisition applying the purchase method of accounting and
the assumptions and adjustments as discussed in the accompanying notes to
the pro forma condensed financial statements. The unaudited pro forma
condensed financial statements do not include any consolidation savings
which Synbiotics Corporation may expect to achieve from the merger of
Synbiotics Corporation and Rhone Merieux Diagnostic Business as any such
savings are not estimable at this time.
These pro forma condensed financial statements have been prepared by the
management of Synbiotics Corporation based upon the audited statement of
operations of Synbiotics Corporation for the year ended December 31, 1996,
the unaudited condensed balance sheet as of June 30, 1997 and the related
unaudited condensed statement of operations for the six months then ended
of Synbiotics Corporation, the unaudited statement of assets of Rhone
Merieux Diagnostic Business as of June 30, 1997, the audited statement of
revenues and direct operating expenses for the year ended December 31,
1996 and the unaudited statement of revenues and direct operating expenses
for the six months ended June 30, 1997 of Rhone Merieux Diagnostic
Business. The unaudited pro forma condensed financial statements should be
read in conjunction with the historical financial statements and notes
thereto and narrative sections included elsewhere herein. The pro forma
condensed financial statements are not necessarily indicative of what
actual results of operations would have been for the periods had the
transaction occurred on the dates indicated and do not purport to indicate
future financial position nor the results of future operations.
-17-
<PAGE>
Synbiotics Corporation
Pro Forma Condensed Balance Sheet (unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
June 30, 1997
------------------------------------------------------------------
Rhone Merieux
Synbiotics Diagnostic Pro Forma Pro Forma
Corporation Business Adjustments Combined
-------------- ------------- ----------- -----------------
<S> <C> <C> <C> <C>
Assets
Current assets:
Cash and equivalents $ 3,652,000 $ $ $ 3,652,000
Securities available for sale 2,181,000 2,181,000
Accounts receivable 3,123,000 917,000 4,040,000
Inventories 4,212,000 2,062,000 6,274,000
Deferred tax assets 421,000 421,000
Other current assets 825,000 825,000
------------- ------------- -----------------
Total current assets 14,414,000 2,979,000 17,393,000
Property and equipment, net 641,000 236,000 877,000
Goodwill 5,358,000 11,245,000 (1) 16,603,000
Deferred tax assets 6,142,000 6,142,000
Other assets 1,592,000 1,592,000
-------------- ------------- -----------------
$ 28,147,000 $ 3,215,000 $ 42,607,000
============== ============= =================
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 1,761,000 $ $ 1,761,000
Current portion of long-term debt 1,000,000 (1) 1,000,000
-------------- ------------- -----------------
Total current liabilities 1,761,000 2,761,000
-------------- ------------- -----------------
Long-term debt 9,541,000 (1) 9,541,000
-------------- ------------- -----------------
Mandatorily redeemable common stock 2,747,000 (1) 2,747,000
-------------- ------------- -----------------
Non-mandatorily redeemable common
stock and other shareholders' equity:
Common stock 35,432,000 169,000 (1) 35,601,000
Common stock warrants 1,003,000 (1) 1,003,000
Accumulated deficit (9,046,000) $ (9,046,000)
-------------- ------------- -----------------
Total non-mandatorily redeemable
common stock and other
shareholders' equity 26,386,000 $ 27,558,000
-------------- ------------- -----------------
$ 28,147,000 $ $ 42,607,000
============== ============= =================
</TABLE>
See accompanying notes to pro forma condensed financial statements.
-18-
<PAGE>
Synbiotics Corportation
Pro Forma Condensed Statement of Operations (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION> Year Ended December 31, 1996
------------------------------------------------------------
Rhone Merieux
Synbiotics Diagnostic Pro Forma Pro Forma
Corporation Business Adjustments Combined
----------- ------------- ----------- ---------
<S> <C> <C> <C> <C>
Net sales $17,217,000 $11,735,000 $(1,760,000)(2) $27,192,000
Cost of sales 9,572,000 5,015,000 (726,000)(3) 13,861,000
----------- ----------- -----------
Gross profit 7,645,000 6,720,000 13,331,000
----------- ----------- -----------
Operating expenses:
Research and development 994,000 1,431,000 (234,000)(3) 2,191,000
Selling and marketing 4,183,000 3,109,000 (1,613,000)(3) 5,679,000
General and administrative 2,057,000 1,081,000 (383,000)(3) 3,505,000
750,000 (4)
----------- ---------- -----------
7,234,000 5,621,000 11,375,000
----------- ---------- -----------
Income from operations 411,000 1,099,000 1,956,000
Interest income (expense),net 204,000 (1,053,000)(5) (849,000)
Gain on sale of securities available for sale 1,159,000 1,159,000
Other income 410,000 410,000
----------- ---------- -----------
Income before income taxes 2,184,000 1,099,000 2,676,000
Income tax expense (benefit) (7,094,000) 46,000 (6) (7,048,000)
----------- ---------- -----------
Net income $ 9,278,000 $ 1,099,000 $ 9,724,000
=========== =========== ===========
Net income per share $ 1.47 $ n/a $ 1.31
=========== =========== ===========
Weighted average shares outstanding $ 6,308,000 n/a 999,000 (7) 7,307,000
=========== =========== ===========
</TABLE>
See accompanying notes to pro forma condensed financial statements.
-19-
<PAGE>
Synbiotics Corporation
Pro Forma Condensed Statement of Operations (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended June 30, 1997
---------------------------------------------------------------------
Rhone Merieux
Synbiotics Diagnostic Pro Forma Pro Forma
Corporation Business Adjustments Combined
-------------- ------------- ---------------- ------------
<S> <C> <C> <C> <C>
Net sales $ 11,781,000 $ 5,760,000 $ (864,000)(2) $ 16,677,000
Cost of sales 6,259,000 2,027,000 78,000 (3) 8,364,000
-------------- ------------- ------------
Gross profit 5,522,000 3,733,000 8,313,000
Operating expenses:
Research and development 613,000 518,000 70,000 (3) 1,201,000
Selling and marketing 2,324,000 587,000 147,000 (3) 3,058,000
General and administrative 1,364,000 343,000 (3) 2,082,000
375,000 (4)
------------- ------------- ------------
4,301,000 1,105,000 6,341,000
------------- ------------- ------------
Income from operations 1,221,000 2,628,000 1,972,000
Interest income (expense), net 106,000 (630,000)(5) (524,000)
Other income 154,000 154,000
------------- ------------- ------------
Income before income taxes 1,481,000 2,628,000 1,602,000
Provision for income taxes 637,000 97,000 (6) 734,000
------------- ------------- ------------
Net income $ 844,000 $ 2,628,000 $ 868,000
============= ============= ============
Net income per share $ .11 $ n/a $ .09
============= ============= ============
Weighted average shares outstanding 7,499,000 n/a 999,000 (7) 8,498,000
============= ============= ============
</TABLE>
See accompanying notes to pro forma condensed financial statements.
-20-
<PAGE>
Synbiotics Corporation
Notes to Pro Forma Condensed Financial Statements (unaudited)
- -------------------------------------------------------------------------------
Note (1)
Adjustment to record the acquisition of Rhone Merieux Diagnostic Business.
Consideration paid comprises $10,541,000 of debt obtained from Banque Paribas,
net of issuance costs and $2,747,000 of Synbiotics Corporation mandatorily
redeemable common stock (759,000 shares issued at $4.1875 per share), net of
issuance costs. In addition, Synbiotics issued to Banque Paribas a warrant to
purchase 240,000 of Synbiotics Corporation common stock for $.01 per share.
Note (2)
Adjustment to reduce Rhone Merieux Diagnostic Business net sales to reflect
distributor mark downs. Prior to the acquisition, the products were sold
direct, whereas subsequent to the acquisition the products will be sold
primarily through distributors.
Note (3)
Adjustment to increase (reduce) the direct operating expenses of Rhone Merieux
Diagnostic Business to reflect Synbiotics Corporation's overhead.
Note (4)
Adjustment to record amortization of the goodwill acquired from Rhone Merieux
Diagnostic Business based on a 15 year amortization period.
Note (5)
Adjustment to record interest expense related to the debt obtained from Banque
Paribas.
Note (6)
Adjustment to record foreign income tax provision related to the taxable income
from Rhone Merieux Diagnostic Business, and to reduce the U.S. tax provision for
the tax effect of additional deductible amounts related to goodwill and interest
expense.
Note (7)
Adjustment to reflect increase in weighted average shares outstanding due to the
issuance of Synbiotics Corporation mandatorily redeemable common stock and
common stock warrants (Note (1)).
-21-
<PAGE>
<TABLE>
<CAPTION>
c) Exhibits
--------
<C> <S>
2.4.1 Amendment No. 1 to Asset Purchase Agreement between Rhone
Merieux, Inc. and the Registrant, dated July 9, 1997.
2.4.2 Amendment No. 2 to Asset Purchase Agreement between Rhone
Merieux, Inc. and the Registrant, dated July 9, 1997.
2.5.1 Amendment No. 1 to Stock Purchase Agreement between Rhone
Merieux S.A.S., Institut De Selection Animale S.A., R.M. -
Diagnostics S.A.S. and the Registrant, dated July 9, 1997.
2.5.2 Amendment No. 2 to Stock Purchase Agreement between Rhone
Merieux S.A.S., Institut De Selection Animale S.A., R.M. -
Diagnostics S.A.S. and the Registrant, dated July 9, 1997.
</TABLE>
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.
SYNBIOTICS CORPORATION
Date: September 22, 1997 /s/ Michael K. Green
--------------------
Michael K. Green
Vice President of Finance and
Chief Financial Officer
-22-
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
EXHIBITS
TO
FORM 8-K
UNDER
SECURITIES EXCHANGE ACT OF 1934
SYNBIOTICS CORPORATION
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Exhibit
- ----------- -------
<C> <S>
2.4.1 Amendment No. 1 to Asset Purchase Agreement between Rhone
Merieux, Inc. and the Registrant, dated July 9, 1997.
2.4.2 Amendment No. 2 to Asset Purchase Agreement between Rhone
Merieux, Inc. and the Registrant, dated July 9, 1997.
2.5.1 Amendment No. 1 to Stock Purchase Agreement between Rhone Merieux
S.A.S., Institut De Selection Animale S.A., R.M. - Diagnostics
S.A.S. and the Registrant, dated July 9, 1997.
2.5.2 Amendment No. 2 to Stock Purchase Agreement between Rhone Merieux
S.A.S., Institut De Selection Animale S.A., R.M. - Diagnostics
S.A.S. and the Registrant, dated July 9, 1997.
</TABLE>
<PAGE>
Exhibit 2.4.1
-------------
AMENDMENT NO. 1
TO
ASSET PURCHASE AGREEMENT
This Amendment No. 1 dated July 9, 1997, to the Asset Purchase Agreement
(the "Agreement") dated as of the 14th day of May, 1997 by and between
Synbiotics Corporation, a California corporation with its principal office at
11011 Via Frontera, San Diego, CA 92127 (the "Buyer"), and Rhone Merieux, Inc.,
a Georgia corporation with its principal office at 115 Transtech Drive, Athens,
Georgia 30601 (the "Seller").
WHEREAS, the parties wish to amend the Agreement as set forth below to
reflect their agreement on the adjustment of the purchase price of the assets
being purchased thereunder, subject to the condition that the distribution of
certain products begin before the end of 1997. Capitalized terms used herein
and not otherwise defined shall have the meanings assigned to them in the
Agreement:
1. Notwithstanding Section 1.1(a)(i) of the Agreement, the Buyer and the
Seller agree that the Seller shall not sell at the Closing, and the Buyer shall
not purchase, any inventories of finished goods or packing materials of the
"Witness" products, and Seller shall retain ownership of such finished goods and
materials and shall either (i) return such finished goods and materials to the
supplier thereof or (ii) sell such finished goods and materials to the Buyer
from time to time in accordance with Section 1.6 of the Agreement.
2. In Section 1.2 of the Agreement, the words "Four Million Two Hundred
Thousand U.S. Dollars ($4,200,000)" are replaced with "Two Million Eight Hundred
and Fifty Thousand U.S. Dollars ($2,850,000)".
3. The existing text of Section 1.2 of the Agreement is redesignated as
paragraph (a) of Section 1.2. and the words "provided that if... " through "as
soon as practicable," are deleted. The following new paragraph (b) is added
thereafter:
"(b) (1) If, prior to January 1, 1998, (i) the Buyer or any of its
Affiliates makes a commercial sale in the United States of any
Heartworm Product (as defined below), approved for sale by the USDA in
any form, or (ii) if the U.S. patent rights on technology relating to
any Heartworm Product are licensed, sublicensed or given by the Buyer
or any of its Affiliates to any third party (other than for the sole
purpose of enabling such third party to manufacture or resell
Heartworm Products on behalf of the Buyer or one of its Affiliates),
the Buyer shall immediately inform the Seller of such event and pay to
the Seller a sum equal to the
-1-
<PAGE>
product of One Hundred Thousand U.S. Dollars ($100,000) times the
number of full calendar months between the date of such event and
December 31, 1997, by wire transfer of immediately available funds to
an account designated by the Seller no later than thirty days after
the date of occurrence of such event. If, prior to January 1, 1998,
(i) the Buyer or any of its Affiliates makes a commercial sale in the
United States of any FeIV Product (as defined below) in any form, or
if the U.S. patent rights on technology related to any FeIV Product
are licensed, sublicensed or given by the Buyer or any of its
Affiliates to any third party (other than for the sole purpose of
enabling such third party to manufacture or resell FeIV Products on
behalf of the Buyer or one of its Affiliates), then Buyer shall
immediately inform the Seller of such event and pay to the Seller
Three Hundred and Fifty Thousand U.S. Dollars ($350,000) by wire
transfer of immediately available funds to an account designated by
the Seller no later than thirty days after the date of occurrence of
such event. For purposes of this Agreement the terms "Heartworm
Product" and "FeIV Product" shall mean the Witness Heartworm product
and the Witness FeIV products, respectively, of the Seller as they
existed in their form of an antigen caught in between two monoclonal
antibodies on the date of the Closing and as such products may be
modified from time to time by or for the Buyer, regardless of the
trademarks under which these products are sold.
(2) If, before January 1, 1998, the Buyer obtains from a third party
a patent or technology license in order to avoid patent or technology
infringement claims in connection with the commercial introduction in
the United States of an FeIV Product, the cost of such license
(including all up front payments and the net present value discounted
at an annual rate of 14% of all future royalties or other similar
payments due from the Buyer or its Affiliates to the licensor for a
period of the remaining duration of the patent or four (4) years,
whichever is shorter), up to a maximum of One Hundred and Seventy-Five
Thousand U.S. Dollars ($175,000), shall be deducted from the Three
Hundred Fifty Thousand U.S. Dollars ($350,000) to be released in
connection with the corresponding FeIV release, and no price
supplement shall be due by RM under new Section 1.6 of the Stock
Purchase Agreement, as amended.
4. Clause (d) of Section 1.6 is amended by adding to the end thereof,
before the semi-colon, the following "or return any items of Retained Inventory
to the manufacturer."
-2-
<PAGE>
5. Section 1.7 of the Agreement is deleted.
6. Section 6.9 of the Agreement is deleted.
7. The first clause of Section 8.5 of the Agreement up to the first
proviso, is amended to read as follows:
"8.5 Limitations on Liability. The liability of the Seller for
indemnification hereunder shall be limited to the sum of (a)
$13,533,690 plus (b) all amounts paid to the Seller pursuant to
Section 1.2(b) of this Agreement, plus (c) the amount of the Earn-Out
Payment, if any, actually paid to RM pursuant to the Stock Purchase
Agreement (collectively the "Indemnification Amount");".
8. The Buyer hereby waives for itself and for any of its Affiliates any
rights it or they may have under Section 8 of the Agreement as a result of any
claim or action by any third party alleging an infringement of a United States
patent or U.S. intellectual property rights arising out of any sale after the
Closing by the Buyer or its Affiliates or licensees of Heartworm Products or
FeIV Products. The Buyer hereby represents that it is aware of the risks of
U.S. patent infringement associated with these products and assumes such risks
to the extent set forth in this Section 6.
9. This Amendment No. 1 may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which shall be one and
the same document.
IN WITNESS WHEREOF, this Amendment No. 1 to the Agreement has been duly
executed by the parties hereto and is effective as of the date first above
written.
SYNBIOTICS CORPORATION
By: /s/ Kenneth M. Cohen
--------------------
Name: Kenneth M. Cohen,
President and Chief Executive
Officer
RHONE MERIEUX, INC.
By: /s/ Kyle W. Lathrop
-------------------
Name: Kyle W. Lathrop
Title: General Counsel/Proxy
-3-
<PAGE>
Exhibit 2.4.2
-------------
AMENDMENT NO. 2
TO
ASSET PURCHASE AGREEMENT
This Amendment No. 2 dated July 9, 1997, to the Asset Purchase Agreement (the
"Agreement") dated as of the 14th day of May, 1997 by and between Synbiotics
Corporation, a California corporation with its principal office at 11011 Via
Frontera, San Diego, CA 92127 (the "Buyer"), and Rhone Merieux, Inc., a Georgia
corporation with its principal office at 115 Transtech Drive, Athens, Georgia
30601 (the "Seller").
The parties wish to amend the Agreement as set forth below. Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
them in the Agreement:
1. The Seller hereby (a) acknowledges that the Buyer is pledging and
assigning its rights, but not its obligations, under each of the Agreement and
the Distribution Agreement to the Banks (as hereinafter defined) under that
certain Credit Agreement dated the date hereof (the "Credit Agreement") among
the Buyer, Banque Paribas, as agent, and the Banks named therein (the "Banks"),
and (b) consents to such pledge and assignment.
2. In all other respects, the Agreement shall remain unamended and in
full force and effect.
3. This Amendment No. 2 may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which shall be one and
the same document.
IN WITNESS WHEREOF, this Amendment No. 2 to the Agreement has been duly executed
by the parties hereto as of and on the date first above written.
BUYER:
SYNBIOTICS CORPORATION
By: /s/ Kenneth M. Cohen
--------------------
Name: Kenneth M. Cohen,
President and Chief Executive
Officer
SELLER:
RHONE MERIEUX, INC.
By: /s/ Kyle W. Lathrop
-------------------
Name: Kyle W. Lathrop
Title: General Counsel/Proxy
-1-
<PAGE>
Exhibit 2.5.1
-------------
AMENDMENT NO. 1
TO
STOCK PURCHASE AGREEMENT
This Amendment No. 1 dated July 9, 1997 to the Stock Purchase Agreement (the
"Agreement") dated as of the 14th day of May, 1997 by and among Synbiotics
Corporation, a California corporation with its principal office at 11011 Via
Frontera, San Diego, CA 92127 (the "Buyer"), and Rhone Merieux, S.A.S., a French
societe par actions simplifiee with its registered office at 17, rue Bourgelat,
69002 Lyon, France ("RM"), Institut de Selection Animale S.A., a French societe
anonyme with its principal place of business at 119, avenue Marechal de Saxe,
69003 Lyon, France ("ISA") (each of RM and ISA is referred to herein as a
"Seller" and collectively as the "Sellers"), and R.M.- Diagnostics S.A.S. a
French societe par actions simplifiee, with its registered office at 299, avenue
Jean Jaures, 69007 Lyon, France (the "Company").
WHEREAS, the parties wish to amend the Agreement as set forth below to
reflect their agreement on an adjustment of the purchase price for the shares of
the Company based upon the date of release on the market of certain products.
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to them in the Agreement is amended to read in its entirety as follows:
1. Paragraph (a) (ii) of Section 1.3 of the Agreement is amended to read
in its entirety as follows:
"(ii) Seven Hundred Fifty-Nine Thousand Eighteen (759,018) shares of
the Common Stock, no par value ("Synbiotics Common Stock"), of the
Buyer (the "Buyer Shares"). At the Closing, Two Hundred Thirty
Thousand (230,000) of the Buyer Shares (the "Escrow Shares") shall be
placed in escrow with the Buyer, to be released to RM or to the Buyer,
as the case may be, upon the occurrence of the following events:
(A) One Hundred Seventy One Thousand Six Hundred (171,600) Escrow
Shares will be released to RM immediately upon the occurrence, prior
to January 1, 1998, of either of the following events: (i) on the date
of the first commercial sale in the United States of any Heartworm
Products (as defined below) by the Buyer or any of its Affiliates
approved for sale by the USDA in any form or (ii) if the US. patents
rights on technology relating to any Heartworm Product are licensed,
sublicensed or given by the Buyer or any of its Affiliates to any
third party (other than for the sole purpose of enabling such third
party to manufacture or resell Products on behalf of the Buyer or one
of its Affiliates) (a "Heartworm Release");
-1-
<PAGE>
(B) Fifty Eight Thousand Four Hundred (58,400) Escrow Shares will be
released to RM immediately upon the occurrence, prior to January 1,
1998, of either of the following events: (i) on the date of the first
commercial sale in the United States of any FeIV Product (as defined
below) by the Buyer or any of its Affiliates approved for sale by the
USDA in any form, or (ii) if the U.S. patent rights on technology
relating to any FeIV Product are licensed, sublicensed or given by the
Buyer or any of its Affiliates to any third party (other than for the
sole purpose of enabling such third party to manufacture or resell
FeIV Products on behalf of the Buyer or one of its Affiliates) (an
"FeIV Release");
(C) if a Heartworm Release has not taken place before January 1,
1998, the number of Escrow Shares released to RM in connection with a
Heartworm Release, if any, will be reduced by Twenty Five Thousand
(25,000) for each of the first four full months elapsed between
January 1, 1998 and the date of the Heartworm Release and then by
Eight Thousand Six Hundred (8,600) per full month lapsed thereafter
prior to a Heartworm Release, on the first day of the following month,
until none of these One Hundred Seventy One Thousand Six Hundred
(171,600) Escrow Shares remains to be released to RM. Escrow Shares
so deducted shall revert in full ownership to the Buyer as of the date
they are deducted;
(D) if an FeIV Release has not taken place before January 1, 1998,
the number of Escrow Shares released to RM in connection with a FeIV
Release, if any, will be reduced by Three Thousand Two Hundred and
Forty (3,240) for each full month lapsed between January 1, 1998 and
the date of the FeIV Release, on the first day of the following month,
until none of these Fifty Eight Thousand Four Hundred (58,400) Escrow
Shares remains to be released to RM; provided that if the Buyer at any
time prior to the second anniversary of the date of the Closing,
commercially introduces any FeIV Product in the form of an antigen
caught in between two monoclonal antibodies into the U.S. market
(whether directly or through an intermediary), all such 58,400 Escrow
Shares shall be immediately released to RM. Any portion of such
58,400 not required to be released to RM as of the second anniversary
of the date of the Closing shall revert in full ownership to the
Buyer;
(E) for purposes of this Agreement, the terms "Heartworm Product" and
"FeIV Product" shall mean the Witness Heartworm product and the
Witness FeIV product, respectively, of Rhone Merieux Inc. as they
existed in their form of antigen caught in-between monoclonal
antibodies form on the date of the Closing and as such products may be
modified from time to time by or for the Buyer, regardless of the
trademarks, under which the products are sold;
-2-
<PAGE>
(F) unless and until Escrow Shares are released to RM in accordance
with this clause 1.3(a)(ii), Seller shall have no rights of ownership
with respect to such Escrow Shares, including without limitation the
right to transfer (other than to the Buyer), to vote or to receive
dividends with respect to such Escrow Shares; provided, however, that
any dividends paid with respect to the Escrow Shares, while held in
escrow, shall accrue to the benefit of the party (RM or the Buyer) to
which such Escrow Shares are ultimately released, and shall be paid to
such party (and in the case of a release to RM, together with interest
thereon at the prime lending rate of The Bank of America) upon the
release of the corresponding Escrow Shares from escrow; plus".
2. The following text is added as a new paragraph at the end of Section
1.3(a) of the Agreement:
"The number of shares to be received by the Sellers under Section
1.3(a)(ii) shall be reduced if the aggregate net book value of the
Inventory of RM, Inc. on the Date of the Closing is less than 100% of
the net book value of the Inventory at December 31, 1996 (an
"Inventory Deficit"). RM shall inform the Buyer two business days
prior to the Closing whether it expects there to be an Inventory
Deficit and, if so, the anticipated amount of such Inventory Deficit
as of the Date of the Closing. In the event that there is an
anticipated Inventory Deficit, the number of shares to be received by
the Sellers will be reduced by the amount of the anticipated Inventory
Deficit, with a reconciliation based on the finally calculated actual
Inventory Deficit to occur as soon as practicable. For that purpose,
the price per share shall be 5.00 U.S. Dollars.
All capitalized terms appearing in this paragraph and not otherwise
defined in this Agreement shall have the meaning assigned thereto in
the U.S. Purchase Agreement. Any and all references to the number of
Buyer Shares shall be amended accordingly in this Agreement and any
agreement executed in its application."
3. Section 1.6 is renumbered Section 1.7 and otherwise left unchanged.
4. The following new Section 1.6 is added:
"1.6 Price Supplement. No later than thirty days after the third
-----------------
anniversary of the date of registration with the USDA of the Heartworm
Product under any trademark (the "Heartworm Registration Date"), the
Buyer shall pay to RM by wire transfer of immediately available funds
denominated in U.S. Dollars,
-3-
<PAGE>
to an account designated by RM, as a price supplement, an amount equal
to five percent (5%) of the total aggregate North American sales of
Heartworm Products by the Buyer, its Affiliates and licensees for such
products during the three year period following the Heartworm
Registration Date, up to a maximum of Five Hundred Thousand U.S.
Dollars ($500,000). No later than thirty days after the third
anniversary of the date of registration with the USDA of the FeIV
Product under any trademark (the "FeIV Registration Date"), the Seller
shall pay to RM, by wire transfer of immediately available funds
denominated in U.S. Dollars, to an account designated by RM, as a
price supplement, an amount equal to five percent (5%) of the total
aggregate North American sales of FeIV Products by the Buyer, its
Affiliates and licensees for such products, during the three year
period following the FeIV Registration Date, up to a maximum of One
Hundred Seventy-Five Thousand U.S. Dollars ($175,000). No price
supplement relating to FeIV shall be due under this Section 1.6 if the
adjustment described under Section 1.2(b)(2) of the Asset Purchase
Agreement, as amended, is made under this Section 1.6."
5. On the 6th line of Section 3.4 (a), the words "May 31, 1997," are
replaced by "June 30, 1997".
6. The first clause of Section 10.5 of the Agreement up to the first
proviso, is amended to read as follows:
"10.5 Limitations on Liability. The liability of RM for
indemnification hereunder shall be limited to the sum of (a)
$13,533,690 plus (b) all amounts paid to RM Inc. pursuant to Section
1.2(b) of the U.S. Purchase Agreement, as amended, plus (c) the amount
of the Earn-Out Payment, if any, actually paid to the Sellers pursuant
to Section 1.5 hereof (collectively, the "Indemnification Amount")."
7. The Buyer hereby irrevocably waives for itself and any of its
Affiliates any rights it or they may have under Section 10 of the Agreement as a
result of any claim or action by any third party alleging an infringement of a
United States patent or U.S. intellectual property rights arising out of any
sale after the Closing by the Buyer or its Affiliates or licensees of Heartworm
Products or FeIV Products. The Buyer hereby represents that it is aware of the
risks of U.S. Patent infringement associated with these products and assumes
such risks to the extent set forth in this Section 7.
8. This Amendment No. 1 may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which shall be one and
the same document.
-4-
<PAGE>
IN WITNESS WHEREOF, this Amendment No. 1 to the Agreement has been duly executed
by the parties hereto and is effective as of the date first above written.
SYNBIOTICS CORPORATION
By: /s/ Kenneth M. Cohen
--------------------
Name: Kenneth M. Cohen,
President and Chief Executive
Officer
R.M. - DIAGNOSTICS S.A.S.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
RHONE MERIEUX S.A.S.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
INSTITUT DE SELECTION ANIMAL S.A.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
-5-
<PAGE>
Exhibit 2.5.2
-------------
AMENDMENT NO. 2
TO
STOCK PURCHASE AGREEMENT
This Amendment No. 2 dated July 9, 1997, to the Stock Purchase Agreement
(the "Agreement") dated as of the 14th day of May 7, 1997 by and among
Synbiotics Corporation, a California corporation with its principal office at
11011 Via Frontera, San Diego, CA 92127 (the "Buyer"), and Rhone Merieux,
S.A.S., a French societe par actions simplifiee with its registered office at
17, rue Bourgelat, 69002 Lyon, France ("RM"), Institut de Selection Animale
S.A., a French societe anonyme with its principal place of business at 119,
avenue Marechal de Saxe, 69003 Lyon, France ("ISA") (each of RM and ISA is
referred to herein as a "Seller" and collectively as the "Sellers"), and R.M.-
Diagnostics S.A.S. a French societe par actions simplifiee, with its registered
office at 299, avenue Jean Jaures, 69007 Lyon, France (the "Company").
The parties wish to amend the Agreement as set forth below. Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
them in the Agreement:
1. Each of the Sellers and the Company hereby (a) acknowledges that the
Buyer is pledging and assigning its rights, but not its obligations, under each
of the Agreement, the Stock Restriction and Rights Agreement, the Supply
Agreement, the Services Agreement, the R&D Agreement, the Trademark License
Agreement and the Distribution Agreements to the Banks (as hereinafter defined)
under that certain Credit Agreement dated the date hereof (the "Credit
Agreement") among the Buyer, Banque Paribas, as agent, and the Banks named
therein (the "Banks"), and (b) consents to such pledge and assignment.
2. The Sellers hereby acknowledge that, in accordance with the Credit
Agreement, the Buyer will issue to Banque Paribas, as agent for the Banks,
Common Stock Purchase Warrants to purchase up to an aggregate of 239,950 shares
of Synbiotics Common Stock, and the Buyer's representations and warranties set
forth in Section 4.2 of the Agreement and in Schedule 4.2 to the Agreement are
hereby deemed to be amended to disclose the issuance of such Common Stock
Purchase Warrants.
3. In all other respects, the Agreement shall remain unamended and in
full force and effect.
4. This Amendment No. 2 may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which shall be one and
the same document.
-1-
<PAGE>
IN WITNESS WHEREOF, this Amendment No. 2 to the Agreement has been duly executed
by the parties hereto as of and on the date first above written.
SYNBIOTICS CORPORATION
By: /s/ Kenneth M. Cohen
--------------------
Name: Kenneth M. Cohen,
President and Chief Executive
Officer
R.M. - DIAGNOSTICS S.A.S.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
RHONE MERIEUX S.A.S.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
INSTITUT DE SELECTION ANIMAL S.A.
By: /s/ Phillipe Martin-Jarand
--------------------------
Name: Phillipe Martin-Jarand
Title:
-2-
