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) April 8, 1999
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PERMA-FIX ENVIRONMENTAL SERVICES, INC.
_____________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 1-11596 58-1954497
________________ ________________ ____________________
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
1940 N.W. 67th Place, Suite A, Gainesville, Florida 32653
___________________________________________________ ________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (352) 373-0040
_______________
Not applicable
___________________________________________________________
(Former name or former address, if changed since last report)
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Item 5. Other Events.
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Pursuant to the terms of a letter of intent dated April 8,
1999, Perma-Fix Environmental Services, Inc. (the "Company") and
Thomas P. Sullivan ("Sullivan") agreed to amend certain terms in
(i) the Agreement And Plan of Merger ("Chem-Con Agreement"), dated
as of the 15th day of March, 1999, among the Company; Florida
Perma-Chem, Inc. a Florida corporation and a wholly-owned
subsidiary of Perma-Fix ("Florida Perma-Chem"); Georgia Perma-Chem,
Inc., a Georgia corporation and a wholly-owned subsidiary of Perma-
Fix ("Georgia Perma-Chem"); Chemical Conservation Corporation; a
Florida corporation ("Chemical Florida"); Chemical Conservation of
Georgia, Inc., a Georgia corporation ("Chemical Georgia"); The
Thomas P. Sullivan Living Trust, dated September 6, 1978 ("TPS
Trust"); The Ann L. Sullivan Living Trust, dated September 6, 1978
("ALS Trust"); Thomas P. Sullivan, an individual ("TPS"); and Ann
L. Sullivan, an individual and (ii) the Agreement and Plan of
Merger ("Chem-Met Agreement"), dated as of the 15th day of March,
1999, among the Company; Perma-Met, Inc. a Michigan Corporation and
a wholly-owned subsidiary of Perma-Fix ("Perma-Met"); Chem-Met
Services, Inc., a Michigan Corporation ("Chem-Met"); the TPS Trust;
the ALS Trust; TPS and ALS. Collectively, Chemical Florida and
Chemical Georgia are referred to herein as "Chem-Con."
Under the letter of intent, the Chem-Con/Chem-Met acquisition
will be consummated by the Company purchasing all of the
outstanding capital stock of Chem-Con and Chem-Met, rather than
undertaking various merger transactions with Chem-Con and Chem-Met
and, consequently, the acquisition under the amended terms will be
accounted for as a "purchase" rather than as a "pooling of
interests" as was previously anticipated. Under the terms of the
letter of intent, the purchase price paid by the Company in
connection with the Chem-Con/Chem-Met acquisition will be $8,700,000,
consisting of (i) $1,000,000 in cash to be paid at closing, (ii) a
promissory note in the amount of $4,700,000, to be paid in equal monthly
installments of principal and interest of approximately $90,276.96 over
five years and having an interest rate of 5.5% for the first three years
and 7% for the remaining two years and (iii) $3,000,000 paid in the
form of 1,500,000 shares of Perma-Fix Common Stock, par value $.001
per share ("Common Stock") paid at closing, however, if the average
closing price of the Common Stock on the NASDAQ SmallCap Market
("NASDAQ") for the five days preceding the date eighteen months
after the closing date ("Valuation Date") is less than $2.00 per
share, the Company shall pay, in Common Stock or cash at the
Company's option, the difference between $3,000,000 and the value
of the 1,500,000 shares based upon the average closing price for
the five days preceding the Valuation Date. The parties have
agreed, however, that under no circumstances will the Chem-
Con/Chem-Met acquisition result in the issuance by the Company of
a number of shares of Common Stock equal to more than 18% of the
number of shares of Common Stock outstanding as of the closing
date. Under the amended terms, the Company believes the Chem-
Con/Chem-Met acquisition may occur without (i) obtaining
shareholder approval from the shareholders of the Common Stock or
(ii) filing a registration statement with the Securities and
Exchange Commission (the "Commission") regarding the Common Stock
to be issued to the TPS Trust and the ALS Trust.
-2-
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An additional modification to the terms of the Chem-Con/Chem-
Met transaction is that the Company will not enter into an
employment agreement with TPS, the current President of Chem-Con
and Chem-Met, as was previously anticipated.
The amendments to the Chem-Con Agreement and the Chem-Met
Agreement are subject to finalization and execution of new
definitive agreements reflecting the new acquisition terms by the
parties thereto which will replace the previous agreements in their
entirety.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits.
2.1 Letter of Intent, dated April 8, 1999, between the
Company and Thomas P. Sullivan.(Exhibits to this
letter as referenced therein are omitted, but will
be provided to the Commission upon request.)
-3-
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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.
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By: /s/ Richard T. Kelecy
___________________________
Richard T. Kelecy
Chief Financial Officer
Date: April 20, 1999
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April 8, 1999
Mr. Thomas P. Sullivan
Chem-Met Services, Inc.
18550 Allen Road
Brownstown, MI 48192
Re: Amendment to the two "Agreement and Plan of Merger" documents
Dear Tom:
Pursuant to our discussions and the agreement as reached today
with Bob Lindquist, we would like to confirm the amended terms of
the two (2) "Agreement and Plan of Merger" documents dated
March 13, 1999, relative to our acquisition of Chem-Met Services,
Inc., Chemical Conservation Corporation and Chemical Conservation
of Georgia, Inc. As discussed, the transaction will no longer
qualify for "pooling of interests" treatment from an accounting
perspective, the Company will agree not to issue more than 18% of
the current issued and outstanding Common Stock in connection
with this acquisition and, as a result, the Proxy and shareholder
approval process will not be required, subject to approval by
NASDAQ that such approval is not required. It is our mutual
intention to close the transaction as quickly as possible (within
30 to 45 days), with the primary timing issue being the permit
transfers and appropriate parties executing the required document
relating to the Four County PRP agreement.
The following will summarize the amended terms of the above
referenced agreements:
* $1,000,000 in cash to be paid at closing;
* $4,700,000 note, equal monthly installments of
principal and interest of $90,276.96 over five
years, at an interest rate of 5 1/2% for the first
three (3) years and 7% for the remaining two (2)
years (based on a 365 day year). See attached
amortization schedule; and
* $3,000,000 of consideration to be paid in the form
of 1,500,000 shares of Common stock valued at
$2.00 per share of Common Stock. This Common
Stock will have an 18 month price guarantee, such
that if the average closing price for the five (5)
trading days preceding the end of 18th month from
the date of closing is less than $2.00 per share,
such calculated difference will be made up, at the
option of the Company, in either cash or Common
Stock. However, it is agreed that the Company
will not issue for purposes of this consideration
more than 18% of the issued and outstanding Common
Stock at the date of closing.
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Page 2
Letter to Thomas P. Sullivan
April 8, 1999
It is agreed that the only changes to the "Agreement and Plan of
Merger" documents will be those necessary to document the above,
including qualified/sophisticated investor language and that no
other unrelated changes will be made. The employment agreement
will be eliminated and any referenced thereto will also be
eliminated. However, the exact non-compete language will
correspondingly be transferred into the "Agreement and Plan of
Merger" documents. Please acknowledge your agreement with the
above. Upon receipt of this signed acknowledgment, we will
immediately begin to amend the documents, get final Congress
approval and proceed with permit transfer applications. This
letter is subject to both parties executing definitive amendments
to the "Agreement and Plan of Merger" documents relating to
Perma-Fix's acquisition of Chem-Con/Chem-Met.
Please advise if you have any questions or concerns.
Sincerely,
/s/ Richard T. Kelecy
Richard T. Kelecy
Chief Financial Officer
cc: Bob Lindquist
Acknowledged and agreed to: /s/ Louis F. Centofanti
_____________________________
Dr. Louis F. Centofanti
Acknowledged and agreed to: /s/ Thomas P. Sullivan
_____________________________
Thomas P. Sullivan
c067:pai
