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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) June 30, 1998
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SUN HEALTHCARE GROUP, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 1-12040 85-041062
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
101 SUN AVENUE, N.E., ALBUQUERQUE, NEW MEXICO 87109
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (505) 821-3355
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NOT APPLICABLE
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(Former name or former address, if changed since last report.)
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Item 5. Other Events.
On June 30, 1998, Sun Healthcare Group, Inc., a Delaware corporation
("Sun"), acquired Retirement Care Associates, Inc., a Colorado corporation
("RCA"), pursuant to the merger (the "RCA Merger") of Peach Acquisition Corp.,
a Colorado corporation ("RCA Merger Sub") and a wholly owned subsidiary of Sun,
with and into RCA, upon the terms set forth in 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, by Amendment No. 3 thereto dated as of November 25, 1997 and
by Amendment No. 4 thereto dated as of April 3, 1998 (as amended, the "RCA
Merger Agreement"), by and among Sun, RCA and RCA Merger Sub. The RCA merger
will be accounted for as a pooling of interests.
On June 30, 1998, Sun also acquired the remaining 35% of Contour Medical,
Inc., a Nevada corporation ("Contour"), not owned by RCA pursuant to the merger
(the "Contour Merger") of Nectarine Acquisition Corp., a Nevada corporation
("Contour Merger Sub") and a wholly owned subsidiary of Sun, with and into
Contour, upon the terms set forth in 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, by Amendment No. 2 thereto dated as of
November 25, 1997 and by Amendment No. 3 thereto dated as of April 3, 1998 (as
amended, the "Contour Merger Agreement"), by and among Sun, Contour and Contour
Merger Sub. The Contour merger will be accounted for as a purchase.
A copy of the press release regarding consummation of the RCA Merger and
the Contour Merger issued by Sun on July 1, 1998 is attached hereto as Exhibit
99.1.
A copy of the RCA Merger Agreement, as amended, is attached as Exhibits
2.1, 2.2., 2.3., 2.4 and 2.5, and a copy of the Contour Merger Agreement, as
amended, is attached as Exhibits 2.6, 2.7 and 2.8, to the Registration
Statement of Sun on Form S-4 filed with the Securities and Exchange Commission
on May 22, 1998 (as amended by Form S-4/A-1 filed June 2, 1998), and are
incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
99.1 Press release issued July 1, 1998 announcing the consummation
of the acquisition of Retirement Care Associates, Inc. and Contour
Medical, Inc. by Sun Healthcare Group, Inc.
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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.
SUN HEALTHCARE GROUP, INC.
By: /s/ William C. Warrick
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Name: William C. Warrick
Title: Vice President, Corporate Controller
Dated: July 16, 1998
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INDEX TO EXHIBITS
DOCUMENT NO. DOCUMENT
99.1 Press release issued July 1, 1998 announcing the consummation
of the acquisition of Retirement Care Associates, Inc. and
Contour Medical, Inc. by Sun Healthcare Group, Inc.
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EXHIBIT 99.1
SUN HEALTHCARE GROUP, INC. 101 Sun Avenue NE
Albuquerque, NM 87109
505.821.3355
www.sunh.com
Sun Healthcare Group Completes Acquisition of Retirement Care Associates and
Contour Medical
ALBUQUERQUE, N. M., July 1 /PRNewswire/ -- Sun Healthcare Group, Inc.
(NYSE: SHG) today announced that it has completed the acquisitions of
Retirement Care Associates, Inc. (NYSE: RCA) and Contour Medical, Inc. (Nasdaq:
CTMI).
Sun will issue 0.505 shares of common stock in exchange for each
outstanding share of RCA common stock, for a total of approximately 7.6 million
shares. Sun will also issue approximately 298,000 shares of its Series B
convertible preferred stock in exchange for the outstanding shares of RCA
Series F preferred stock, which is convertible into approximately 280,000
shares of Sun common stock.
Sun also acquired Contour Medical, a national provider of medical
supplies for the long-term care industry and specialty products for hospitals.
RCA owns approximately 65 percent of the outstanding shares of Contour Medical.
Sun will issue approximately 1.8 million shares of common stock in exchange for
the remaining 35 percent of Contour Medical common stock, which is an exchange
ratio of 0.524.
The total value of the RCA and Contour Medical transactions, including
debt assumed, is approximately $320 million. The transactions were approved by
Sun, RCA and Contour Medical shareholders on June 30, 1998. Both acquisitions
were approved by 90 percent of the votes cast by Sun shareholders.
Subsequent to the announcement of the merger agreement between Sun and
RCA in February 1997, Sun subsidiaries became providers of therapy and pharmacy
services to most of the RCA facilities. As a result, the full integration of
the two companies is expected during 1998.
The completion of the RCA acquisition adds 97 long-term and subacute care
facilities to Sun's U.S. operations. Of these, 74 are skilled nursing
facilities with more than 8,200 beds, and 23 are assisted living facilities
with more than 2,500 units. Sun's U.S. operations now include 387 skilled
nursing facilities with more than 44,000 beds, and 33 assisted living
facilities with 3,500 units. The company also operates 179 facilities with
11,200 beds in the United Kingdom, Spain, Australia and Germany.
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.
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, and Sun's
registration statement on Form S-4, as amended, filed in connection with the
RCA and Contour Medical transactions.
SOURCE Sun Healthcare Group, Inc.
CONTACT: Investors: Marjorie Goldstein or Media: Phyllis Goodman
of Sun Healthcare, 505-821-3355
Web Site: http://www.sunh.com
