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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 3, 1998
SUN HEALTHCARE GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-12040 85-0410612
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
101 SUN AVENUE, N.E., ALBUQUERQUE, NEW MEXICO 87109
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (505) 821-3355
NOT APPLICABLE
(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS
On April 3, 1998, Sun Healthcare Group, Inc. ("Sun") entered into a
fourth amendment (the "RCA Amendment") to the Agreement and Plan of
Merger and Reorganization, dated as of February 17, 1997, as amended by
Amendment No. 1 thereto dated as of May 27, 1997, by Amendment No. 2
thereto dated as of August 21, 1997 and by Amendment No. 3 thereto dated
as of November 25, 1997 (as amended, the "RCA Merger Agreement"), by and
among Sun, Retirement Care Associates, Inc., a Colorado corporation
("RCA"), and Peach Acquisition Corporation, a Colorado corporation and a
wholly-owned subsidiary of Sun ("RCA Merger Sub"), pursuant to which RCA
Merger Agreement RCA Merger Sub will be merged (the "RCA Merger") with
and into RCA.
The RCA Amendment (i) extends the date after which either party may
freely terminate the RCA Merger Agreement from March 31, 1998 to June
30, 1998 and (ii) adds as a condition to Sun's obligation to consummate
the RCA Merger a requirement that a Memorandum of Understanding entered
into in connection with the settlement of certain shareholder litigation
involving RCA remain in effect.
On April 3, 1998, Sun also entered into a third amendment (the
"Contour Amendment") to the Agreement and Plan of Merger and Reorganization,
dated as of February 17, 1997, as amended by Amendment No. 1 thereto dated
as of August 21, 1997 and by Amendment No. 2 thereto dated as of November 25,
1997 (as amended, the "Contour Merger Agreement"), by and among Sun, Contour
Medical, Inc., a Nevada corporation ("Contour"), and Nectarine Acquisition
Corporation, a Nevada corporation and a wholly-owned subsidiary of Sun
("Contour Merger Sub"), pursuant to which Contour Merger Agreement Contour
Merger Sub will be merged (the "Contour Merger" and, together with the RCA
Merger, the "Mergers") with and into Contour.
The Contour Amendment extends the date after which either party may
freely terminate the Contour Merger Agreement from March 31, 1998 to
June 30, 1998.
The Mergers are subject to approval by the stockholders of both
companies and will be considered at separate meetings now anticipated to
occur in the second quarter of 1998. The Mergers remain subject to
other customary conditions. The Mergers will be completed promptly
following stockholder approval, assuming satisfaction of the other
conditions to the Mergers.
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The foregoing description is qualified in its entirety by reference
to the full text of the RCA Amendment and the Contour Amendment, which are
attached hereto as Exhibits 2.1 and 2.2 and are incorporated herein by
reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(c) EXHIBITS
2.1 Amendment No. 4 to the Agreement and Plan of Merger and
Reorganization dated as of February 17, 1997 among Sun
Healthcare Group, Inc., Retirement Care Associates, Inc. and
Peach Acquisition Corporation.
2.2 Amendment No. 3 to the Agreement and Plan of Merger and
Reorganization dated as of February 17, 1997 among Sun
Healthcare Group, Inc., Contour Medical, Inc. and Nectarine
Acquisition Corporation.
99.1 Press Release dated April 6, 1998
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 thereunto duly authorized.
SUN HEALTHCARE GROUP, INC.
By: /s/ William C. Warrick
Name: William C. Warrick
Title: Vice President, Corporate
Controller
Dated: April 7, 1998
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INDEX TO EXHIBITS
EXHIBIT
NO. DOCUMENT
2.1 Amendment No. 4 to the Agreement and Plan of Merger and
Reorganization dated as of February 17, 1997 among Sun
Healthcare Group, Inc., Retirement Care Associates, Inc.
and Peach Acquisition Corporation.
2.2 Amendment No. 3 to the Agreement and Plan of Merger and
Reorganization dated as of February 17, 1997 among Sun
Healthcare Group, Inc., Contour Medical, Inc. and Nectarine
Acquisition Corporation.
99.1 Press Release dated April 6, 1998.
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EXHIBIT 2.1
AMENDMENT NO. 4 TO THE
AGREEMENT AND PLAN OF REORGANIZATION
THIS AMENDMENT NO. 4 to the AGREEMENT AND PLAN OF MERGER AND
REORGANIZATION, dated as of February 17, 1997, as amended by Amendment
No. 1 thereto dated as of May 27, 1997, Amendment No. 2 thereto dated as
of August 21, 1997 and Amendment No. 3 thereto dated as of November 25,
1997 (as so amended, the "Merger Agreement," capitalized terms used but
not otherwise defined herein are used herein as therein defined), among
SUN HEALTHCARE GROUP, INC., a corporation organized and existing under
the laws of the State of Delaware ("Parent"), PEACH ACQUISITION
CORPORATION, a corporation organized and existing under the laws of the
State of Colorado ("Merger Sub") and a direct wholly owned subsidiary of
Parent, and RETIREMENT CARE ASSOCIATES, INC., a corporation organized and
existing under the laws of the State of Colorado (the "Company"), is made
this 3rd day of April, 1998 by and among Parent, Merger Sub and the
Company.
W I T N E S S E T H:
WHEREAS, Parent, Merger Sub and the Company have entered into the
Merger Agreement which provides, upon the terms and subject to the
conditions set forth therein, for the Merger of Merger Sub with and into
the Company; and
WHEREAS, the boards of directors of Parent, Merger Sub and the Company
have each determined that it is consistent with and in furtherance of their
respective long-term business strategies and fair to and in the best
interests of their respective stockholders to amend the Merger Agreement
as provided herein.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements set forth herein,
and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, and intending to be legally bound hereby,
the parties hereto hereby agree as follows:
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SECTION 1. Amendments to Merger Agreement. The Merger Agreement
is hereby amended as follows:
(a) Section 8.03(e) of the Merger Agreement is hereby amended and
restated in its entirety to read as follows:
"(e) the Memorandum of Understanding (the "MOU") dated as of
November 25, 1997, among Chris Brogdon, Darrell C. Tucker, Julian
S. Daley, Edward E. Lane, Harlan Mathews and the Company and the
plaintiffs on behalf of themselves as well as all members of the
class in the Retirement Care Associates Securities Litigation (In
re Retirement Care Associates Securities Litigation), Master File
No. 1:97-CV-2458-CC (the "Action"), or another agreement providing
for the settlement in principle of the Action on terms no less
favorable to Parent or the Company than those contained in the MOU,
shall be in full force and effect on and as of the Effective Time,
and no action shall have been taken by any party (other than
Parent) to the MOU or such other agreement to terminate, void or
withdraw from, or amend or otherwise modify in a manner adverse to
Parent or the Company, the MOU or such other agreement."
(b) Section 9.01(b) of the Merger Agreement is hereby amended and
restated in its entirety to read as follows:
"(b) by either Parent or the Company, if the Effective Time
shall not have occurred on or before June 30, 1998; provided,
however, that the right to terminate this Agreement under this
Section 9.01(b) shall not be available to any party whose failure
to fulfill any obligation under this Agreement shall have caused,
or resulted in, the failure of the Effective Time to occur on or
before such date."
SECTION 2. Representations and Warranties.
(a) Representations and Warranties of the Company. The Company
hereby represents and warrants to Parent and Merger Sub that: The
Company has all necessary corporate power and authority to execute and
deliver this Amendment, to perform its obligations under the Merger
Agreement as amended hereby and to consummate the transactions
contemplated hereby. The execution and delivery of this Amendment by
the Company and the consummation by the Company of the transactions
contemplated by the Merger Agreement as amended hereby have been duly
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and validly authorized by all necessary corporate action (other than
stockholder approval as described in the Merger Agreement). This
Amendment has been duly executed and delivered by the Company and,
assuming the due authorization, execution and delivery by Parent and
Merger Sub, constitutes the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
Since the date of Amendment No. 3 to the Merger Agreement, (i) no damage
to, or destruction of, the tangible property or assets of the Company or
any of the Company Subsidiaries has occurred, and (ii) no suit, claim,
action, proceeding or investigation has been commenced or, to the
knowledge of the Company, threatened against the Company or any Company
Subsidiary before any Governmental Entity (A) by any party other than a
Governmental Entity and relating to patient care matters or (B) by any
Governmental Entity, which in the case of clauses (i) or (ii),
individually or in the aggregate, could reasonably be expected to have a
Company Material Adverse Effect (other than any Disclosed Item).
(b) Representations and Warranties of Parent and Merger Sub.
Parent and Merger Sub hereby jointly and severally represent and warrant
to the Company that: Parent and Merger Sub have all necessary corporate
power and authority to execute and deliver this Amendment, to perform
their respective obligations under the Merger Agreement as amended
hereby and to consummate the transactions contemplated hereby. The
execution and delivery of this Amendment by Parent and Merger Sub and
the consummation by Parent and Merger Sub of the transactions contemplated
by the Merger Agreement as amended hereby have been duly and validly
authorized by all necessary corporate action (other than stockholder
approval as described in the Merger Agreement). This Amendment has been
duly executed and delivered by Parent and Merger Sub and, assuming the due
authorization, execution and delivery by the Company, constitutes the
legal, valid and binding obligation of Parent and Merger Sub, enforceable
against Parent and Merger Sub in accordance with its terms.
SECTION 3. Effect on Merger Agreement. Except as otherwise
specifically provided herein, the Merger Agreement shall not be amended
but shall remain in full force and effect.
SECTION 4. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK (WITHOUT REFERENCE TO CONTRACT OF LAW PRINCIPLES OTHER THAN
THOSE DIRECTING NEW YORK LAW) EXCEPT TO THE EXTENT MANDATORILY GOVERNED
BY THE LAWS OF THE STATE OF COLORADO.
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SECTION 5. Counterparts. This Amendment may be signed in one or
more counterparts, each of which shall be an original but all of which,
taken together, shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed as of the date first written above by their respective
officers thereunto duly authorized.
SUN HEALTHCARE GROUP, INC.
By: /s/ Robert D. Woltil
Name: Robert D. Woltil
Title: Senior Vice President for Financial
Services and Chief Financial Officer
PEACH ACQUISITION CORPORATION
By: /s/ Robert D. Woltil
Name: Robert D. Woltil
Title: Vice President
RETIREMENT CARE ASSOCIATES, INC.
By: /s/ Christopher F. Brogdon
Name: Christopher F. Brogdon
Title: President and Chief Executive Officer
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EXHIBIT 2.2
AMENDMENT NO. 3 TO THE
AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
THIS AMENDMENT NO. 3 (this "Amendment") to the AGREEMENT AND PLAN OF
MERGER AND REORGANIZATION, dated as of February 17, 1997, as amended by
Amendment No. 1 thereto dated as of August 21, 1997 and Amendment No. 2
thereto dated as of November 25, 1997 (as so amended, the "Merger
Agreement," capitalized terms used but not otherwise defined herein are
used herein as therein defined), among SUN HEALTHCARE GROUP, INC., a
corporation organized and existing under the laws of the State of Delaware
("Parent"), NECTARINE ACQUISITION CORPORATION, a corporation organized and
existing under the laws of the State of Nevada ("Merger Sub") and a direct
wholly owned subsidiary of Parent, and CONTOUR MEDICAL, INC., a corporation
organized and existing under the laws of the State of Nevada (the
"Company"), is made this 3rd day of April, 1998 by and among Parent, Merger
Sub and the Company.
W I T N E S S E T H:
WHEREAS, Parent, Merger Sub, and the Company desire to amend the
Merger Agreement as provided herein.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements set forth herein,
and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, and intending to be legally bound hereby,
the parties hereto hereby agree as follows:
SECTION 1. Amendments to Merger Agreement. The Merger Agreement
is hereby amended as follows:
(a) Section 9.01(b) of the Merger Agreement is hereby amended
and restated in its entirety to read as follows:
"(b) by either Parent or the Company, if the Effective Time
shall not have occurred on or before June 30, 1998; provided,
however, that the right to terminate this Agreement under this
Section 9.01(b) shall not be available to any party whose failure
to fulfill any obligation under this Agreement shall have caused,
or resulted in, the failure of the Effective Time to occur on or
before such date."
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SECTION 2. Representations and Warranties.
(a) Representations and Warranties of the Company. The Company
hereby represents and warrants to Parent and Merger Sub that: The
Company has all necessary corporate power and authority to execute and
deliver this Amendment, to perform its obligations under the Merger
Agreement as amended hereby and to consummate the transactions
contemplated hereby. The execution and delivery of this Amendment by
the Company and the consummation by the Company of the transactions
contemplated by the Merger Agreement as amended hereby have been duly
and validly authorized by all necessary corporate action (other than
stockholder approval as described in the Merger Agreement). This
Amendment has been duly executed and delivered by the Company and,
assuming the due authorization, execution and delivery by Parent and
Merger Sub, constitutes the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(b) Representations and Warranties of Parent and Merger Sub.
Parent and Merger Sub hereby jointly and severally represent and warrant
to the Company that: Parent and Merger Sub have all necessary corporate
power and authority to execute and deliver this Amendment, to perform
their respective obligations under the Merger Agreement as amended
hereby and to consummate the transactions contemplated hereby. The
execution and delivery of this Amendment by Parent and Merger Sub and
the consummation by Parent and Merger Sub of the transactions
contemplated by the Merger Agreement as amended hereby have been duly
and validly authorized by all necessary corporate action (other than
stockholder approval as described in the Merger Agreement). This
Amendment has been duly executed and delivered by Parent and Merger Sub
and, assuming the due authorization, execution and delivery by the
Company, constitutes the legal, valid and binding obligation of Parent
and Merger Sub, enforceable against Parent and Merger Sub in accordance
with its terms.
SECTION 3. Effect on Merger Agreement. Except as otherwise
specifically provided herein, the Merger Agreement shall not be amended
but shall remain in full force and effect.
SECTION 4. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK (WITHOUT REFERENCE TO CONTRACT OF LAW PRINCIPLES OTHER THAN
THOSE DIRECTING NEW YORK LAW) EXCEPT TO THE EXTENT MANDATORILY GOVERNED
BY THE LAWS OF THE STATE OF NEVADA.
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SECTION 5. Counterparts. This Amendment may be signed in one or
more counterparts, each of which shall be an original but all of which,
taken together, shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed as of the date first written above by their respective
officers thereunto duly authorized.
SUN HEALTHCARE GROUP, INC.
By: /s/ Robert D. Woltil
Name: Robert D. Woltil
Title: Senior Vice President for Financial
Services and Chief Financial Officer
NECTARINE ACQUISITION CORPORATION
By: /s/ Robert D. Woltil
Name: Robert D. Woltil
Title: Vice President
CONTOUR MEDICAL, INC.
By: /s/ Christopher F. Brogdon
Name: Christopher F. Brogdon
Title: Chairman of the Board
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EXHIBIT 99.1
[LETTERHEAD OF SUN HEALTHCARE GROUP]
Contact: Phyllis Goodman (media)
Marjorie Goldstein (investors)
(505) 821-3355
SUN HEALTHCARE GROUP AND RETIREMENT CARE ASSOCIATES
EXTEND TERMINATION DATE OF MERGER AGREEMENT
Albuquerque, N.M., and Atlanta, Ga., April 6, 1998 - Sun Healthcare Group,
Inc. (NYSE:SHG) and Retirement Care Associates, Inc. (NYSE:RCA) announced
today that they have amended the terms of their merger agreement. The
principal effect of the amendment is to extend the date after which either
party may freely terminate the RCA Merger Agreement from March 31, 1998 to
June 30, 1998. The amendment also adds as a condition to Sun's obligation
to consummate the Merger a requirement that a Memorandum of Understanding
entered into in connection with the settlement of certain shareholder
litigation involving RCA remain in effect. The boards of directors of Sun
and of RCA have each approved the merger agreement amendment.
Sun originally entered into separate merger agreements with RCA and
Contour Medical, Inc. (Nasdaq SmallCap: CTMI) on Feb. 17, 1997. The
parties amended the terms of the RCA agreement on May 27, 1997, and both
the RCA and the Contour agreements on Aug. 21, 1997 and Nov. 25, 1997.
RCA owns approximately 65 percent of the outstanding shares of Contour.
Sun's merger agreement with Contour has been amended to match the RCA
amendment in extending the date after which either party may freely
terminate the agreement from March 31, 1998 to June 30, 1998. The parties
contemplate closing both transactions in the second quarter of 1998.
Closing of the transactions is subject to the satisfaction of customary
conditions. The RCA acquisition is intended to be accounted for as a
pooling of interests. The Contour acquisition is intended to be accounted
for as a purchase.
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Headquartered in Albuquerque, N.M., Sun Healthcare Group, Inc., is
a diversified international long-term care provider. Sun operates
long-term and subacute care facilities in the United States, the United
Kingdom, Spain, Australia and Germany. Sun also provides therapy and
pharmacy services, medical supplies and comprehensive ancillary services to
the long-term care industry.
Atlanta, Ga.-based Retirement Care Associates, Inc. operates long-term
care, independent and assisted living facilities located primarily in the
southeastern United States. Contour Medical, Inc. is a national provider
of medical supplies for the long-term care industry.
Except for historical information, all other matters in this press
release are forward-looking statements that involve risks and uncertainties
as detailed from time to time in the company's SEC filings, including Sun's
annual report on Form 10-K for the fiscal year ended Dec. 31, 1997.
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