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 (Date of earliest event reported): June 4, 1995
Diagnostek, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-10610 85-0312837
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
4500 Alexander Boulevard, N.E.
Albuquerque, New Mexico 87107
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (505) 345-1000
Former name or former address,
if changed since last report
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Item 5. Other Events.
On June 4, 1995, Diagnostek, Inc. (the "Registrant") entered into a
First Amendment to the Agreement and Plan of Merger, among Value Health, Inc.
("VHI"), VHI Merger Sub. Corp. ("VHI Sub"), a wholly-owned subsidiary of VHI,
and the Registrant (the "Amendment"). A copy of the Amendment is attached as
Exhibit 10.1 and is hereby incorporated by reference.
Pursuant to the Amendment, the Exchange Ratio, as defined in the
Agreement and Plan of Merger dated as of March 27, 1995 among VHI, VHI Sub and
the Registrant (the "Merger Agreement") was changed from 0.55 to 0.4975. Thus,
at the Effective Date of the Merger (as defined in the Merger Agreement, as
amended), each share of common stock of the Registrant will be converted into
the right to receive 0.4975 shares of the common stock, no par value of VHI.
The Amendment also provided that the condition precedent to VHI and
VHI Sub's obligations to consummate the transaction relating to the accuracy of
the Registrant's representations and warranties at the Effective Date (as
defined in the Merger Agreement, as amended) has been limited to the
representations and warranties set forth in Sections 5.2, 5.3, 5.4, 5.5(b) and
5.11 of the Merger Agreement, as amended.
On June 4, 1995, the Registrant, VHI and Nunzio DeSantis, the Chairman
of the Board and Chief Executive Officer of the Registrant amended the
Consulting Agreement dated as of March 27, 1995 among the Registrant, Mr.
DeSantis and VHI and the Agreement Not to Compete dated as of March 27, 1995
among the Registrant, VHI and Mr. DeSantis. The foregoing amendments relate to
the timing of payments to Mr. DeSantis under such agreements, but not the
aggregate amount to be paid to him. A copy of the letter dated June 4, 1995 is
attached as Exhibit 10.2 and is hereby incorporated by reference.
On June 4, 1995, the Registrant delivered a letter to Diagnostek
containing certain agreements with respect to the composition of the Diagnostek
Board of Directors through October 15, 1995 and the continued employment of
certain named executive employees through such date. A copy of the letter dated
June 4, 1995 is attached as Exhibit 10.3 and is hereby incorporated by
reference.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits
10.1 First Agreement to Agreement and Plan of Merger, dated
as of June 4, 1995, by and among VHI, VHI Sub and the
Registrant.
10.2 Letter dated June 4, 1995 from the Registrant to Nunzio
P. DeSantis.
10.3 Letter dated June 4, 1995 from VHI to the Registrant.
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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 thereunto duly authorized.
Dated: June 7, 1995 DIAGNOSTEK, INC.
By: /s/ William A. Barron
Name: William A. Barron
Title: President
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EXHIBIT INDEX
Exhibit
Number Description of Document Page
10.1 First Amendment to Agreement and
Plan of Merger, dated as of June 4,
1995, by and among VHI, VHI Sub and
the Registrant.
10.2 Letter dated June 4, 1995 from the
Registrant to Nunzio P. DeSantis.
10.3 Letter dated June 4, 1995 from VHI
to the Registrant.
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Exhibit 10.1
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this
"Amendment"), dated as of June 4, 1995, by and among VALUE HEALTH, INC., a
Delaware corporation ("Parent"), VHI MERGER-SUB. CORP., a Delaware corporation
and a direct, wholly-owned subsidiary of Parent ("Sub") and DIAGNOSTEK, INC., a
Delaware corporation (the "Company"):
W I T N E S E T H
WHEREAS, Parent, Sub and the Company entered into an Agreement and
Plan of Merger dated as of March 27, 1995 (the "Merger Agreement") pursuant to
which Sub will be merged with and into the Company with the Company surviving as
a wholly-owned subsidiary of Parent, all upon the terms and subject to the
conditions set forth in the Merger Agreement;
WHEREAS, in accordance with Section 10.3 of the Merger Agreement,
Parent, Sub and the Company desire to enter into this Amendment to amend the
Merger Agreement as provided herein;
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants and agreements contained herein, the parties hereto agree as follows;
1. Exchange Ratio. Section 3.1(b) of the Merger Agreement is hereby
amended to delete the number ".55" and insert in its place the number ".4975."
2. Notice of Certain Changes or Events. Article VII of the Merger
Agreement is hereby amended to add an additional Section to read in its entirety
as follows:
Section 7.5 Notice Certain Changes or Events. Each party
shall promptly give written notice to the other party upon becoming
aware of the occurrence or, to its knowledge, impending or threatened
occurrence, of any change in circumstances or event which would cause
or constitute, in the case of a written notice by Parent, a Parent
Material Adverse Effect or, in the case of a written notice by the
Company, a Company Material Adverse Effect.
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3. Conditions to Obligations of Parent and Sub to Effect the Merger.
Section 9.3(a) of the Merger Agreement is hereby amended in its entirety to read
as follows:
(a) The Company shall have performed in all material respects its
agreements contained in this Merger Agreement required to be performed
on or prior to the Effective Date, the representations and warranties
of the Company contained in this Merger Agreement shall be true when
made and, except as contemplated or permitted by this Merger
Agreement, the representations and warranties contained in Sections
5.2, 5.3, 5.4, 5.5(b) and 5.11 shall be true on and as of the
Effective Date as if made on and as of such date (except to the extent
they relate to a particular date, in which case they shall remain true
and correct as of the applicable date made); and Parent and Sub shall
have received a certificate of the President or Chief Executive
Officer or a Vice President of the Company to the foregoing effects.
4. Delivery of Audited Financial Statements of the Company. Section
9.3(d) of the Merger Agreement is hereby amended to delete the date "May 31,
1995" in the third line and insert in its place the date "June 6, 1995."
5. Effect of Amendment. Except as expressly provided in this
Amendment, all terms and conditions of the Merger Agreement shall remain in full
force and effect without modification.
6. Capitalized Terms. Capitalized terms used herein and not otherwise
defined shall have the meanings given such terms in the Merger Agreement.
<PAGE>
IN WITNESS WHEREOF, Parent, Sub and the Company have caused this
Amendment to be signed by their respective officers thereunder duly authorized
all as of the date first written above.
VALUE HEALTH, INC.
/s/ ROBERT E. PATRICELLI
By: Robert E. Patricelli
Its: Chief Executive Officer
ATTEST:
/s/ PAUL M. FINIGAN
By: Paul M. Finigan
Its: Vice President and General Counsel
VHI MERGER-SUB CORP.
/s/ WILLIAM McBRIDE
By: William McBride
Its: President and Chief
Operating Officer
ATTEST:
/s/ PAUL M. FINIGAN
By: Paul M. Finigan
Its: Vice President and General Counsel
DIAGNOSTEK, INC.
/s/ WILLIAM A. BARRON
By: William A. Barron
Its: President
ATTEST:
/s/ COURTLANDT G. MILLER
By: Courtlandt G. Miller
Its: Secretary
Exhibit 10.2
DIAGNOSTEK, INC.
4500 Alexander Boulevard, N.E.
Albuquerque, New Mexico 87107
June 4, 1995
Mr. Nunzio P. DeSantis
4500 Alexander Blvd., N.E.
Albuquerque, New Mexico 87107
Dear Mr. DeSantis:
This letter sets forth our agreement with respect to certain
amendments to the payment terms of (i) the Consulting Agreement dated as of
March 27, 1995 among Diagnostek, Inc., Value Health, Inc. (for purposes of
Section 6 thereof only) and you and (ii) the Agreement Not to Compete dated as
of March 27, 1995 among Diagnostek, Value Health and you.
Section 3(a) of the Consulting Agreement is hereby amended to provide
that the first monthly installment payable under such Section shall be payable
on January 15, 1996 and shall be accompanied by a one time lump sum payment
equal to the product of $328.77 multiplied by the number of days in 1995 that
you were retained as a consultant under the Consulting Agreement.
Section 2 of the Agreement Not to Compete is hereby amended to provide
that the $3,500,000 payment that is required to be paid to you pursuant to such
Section shall be payable in one lump sum on January 1, 1996.
Except as provided above, all provisions of the Consulting Agreement
and the Agreement Not to Compete shall remain in full force and effect without
modification.
Please indicate your agreement to the foregoing amendments to the
payment terms of the Consulting Agreement and the Agreement Not to Compete by
executing this letter where indicated below. Value Health has informed us that
Value Health has agreed to the foregoing amendments and will indicate such
agreement by executing this letter.
Very truly yours,
DIAGNOSTEK, INC.
/s/ William Barron
Name: William Barron
Title: President
ACKNOWLEDGED AND AGREED, ACKNOWLEDGED AND AGREED,
this 4th day of June, 1995 by: this 4th day of June, 1995 by:
VALUE HEALTH, INC.
/s/ Nunzio P. DeSantis /s/ Paul M. Finigan
Nunzio P. DeSantis Name: Paul M. Finigan
Title: V.P., General Counsel
Exhibit 10.3
VALUE HEALTH, INC.
22 Waterville Road
Avon, Connecticut 06001
June 4, 1995
Diagnostek, Inc.
c/o E. Gerald Riesenbach
Cozen and O'Connor
The Atrium
1900 Market Street
Philadelphia, PA 19103
Gentlemen:
Reference is made to the Agreement and Plan of Merger dated as of
March 27, 1995 by and among Value Health, Inc., a Delaware corporation ("VHI"),
VHI Merger-Sub Corp., a Delaware corporation, and Diagnostek, Inc., a Delaware
corporation ("Diagnostek"), as amended as of June 4, 1995 (the "Merger
Agreement").
This will confirm:
1. At or prior to the time of the "Merger" (as defined in the Merger
Agreement), arrangements will be made so that each of the current directors of
Diagnostek may remain as a director of Diagnostek until October 15, 1995. From
and after the time of the Merger, the Diagnostek Board will also include other
persons, the identity and number of which shall be designated by VHI in its
discretion.
2. In the event that, between the time of the Merger and October 15,
1995, it is determined that the employment of a person listed below is to be
terminated, any such termination shall be effective no earlier than October 15,
1995, with the compensation payable to such person during the time from the date
of such determination through October 15, 1995 to be credited against severance
payable to such person as a result of such termination. The persons covered by
this paragraph 2 are as follows: William Barron, Vincent Villaneuve, Jeffrey
Ovington, Arthur Solomon, Andrew Massetti and James Raabe.
Value Health, Inc.
By: /s/ Paul M. Finigan
