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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 3
TO
SCHEDULE 14D-9
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Solicitation/Recommendation Statement
Pursuant to Section 14(d)(4) of the
Securities Exchange Act of 1934
THERATX, INCORPORATED
(Name of Subject Company)
THERATX, INCORPORATED
(Name of Person(s) Filing Statement)
Common Stock, Par Value $.001 Per Share (and Preferred Share Purchase Rights)
(Title of Class of Securities)
_______883384109______
(CUSIP Number of Class of Securities)
JOHN A. BARDIS
PRESIDENT & CHIEF EXECUTIVE OFFICER
THERATX, INCORPORATED
1105 Sanctuary Parkway, Suite 100
Alpharetta, GA 30201
(770) 569-1840
(Name, Address and Telephone Number of Person Authorized to
Receive Notice and Communications
on Behalf of the Person(s) Filing Statement)
Copies to:
Steven J. Gartner, Esq.
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, New York 10022
(212) 821-8000
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TheraTx, Incorporated, a Delaware corporation (the "Company"), hereby
amends and supplements its Solicitation/Recommendation Statement on Schedule
14D-9 (the "Schedule 14D-9"), filed with the Securities and Exchange Commission
on February 14, 1997, as amended by Amendment No. 1 on February 24, 1997, and as
amended by Amendment No. 2 on February 28, 1997, with respect to the tender
offer of Vencor, Inc., a Delaware corporation ("Vencor") and its wholly owned
subsidiary, Peach Acquisition Corp., a Delaware corporation (the "Purchaser"),
to purchase all of the outstanding shares of Common Stock, $.001 par value per
share (the "Common Stock") of the Company (and the associated Preferred Share
Purchase Rights).
Unless otherwise indicated herein, each capitalized term used but not
defined herein shall have the meaning given to such term in the Schedule 14D-9.
Item 3. Identity and Background.
(b) (ii) The Merger Agreement
Treatment of Options. The Company, Vencor and Purchaser executed
Amendment No. 1 to the Agreement and Plan of Merger, dated as of February 28,
1997 (the "Merger Amendment") amending the Merger Agreement. The Merger
Amendment amends the Merger Agreement to provide that at the Effective
Time, the Options held by (1) John A. Bardis, Bret W. Jorgensen, Donald R.
Myll, Louis E. Hallman, III, Laura E. Cayce, Jonathan H. Glenn, Craig A.
Reamsnyder and B. Wayne Clark, (2) any individual who holds, in the
aggregate, Options to purchase no more than 1,500 Shares and (3) such other
individuals who the Company and Vencor mutually agree shall be subject to
such treatment, shall have their Options canceled and the holder thereof
shall be entitled to a cash payment equal to the product of (x) the amount,
if any, by which the Merger Consideration exceeds the exercise price per
Share subject to such Option and (y) the number of Shares issuable pursuant to
the unexercised portion of such Option, less any required withholding of
taxes.
The Merger Amendment further provides that, at the Effective Time,
except for any Options referred to above, each outstanding Option shall be
converted into an option (a "Replacement Option") to acquire, on the same terms
and conditions as were applicable under such Option, a number of shares of
Vencor Common Stock equal to (a) the number of Shares subject to the Option,
multiplied by (b)(i) the Merger Consideration, divided by (ii) the average price
of Vencor Common Stock on the trading day immediately prior to the Effective
Time, at an exercise price per share equal to (y) the aggregate exercise price
for the Shares which were purchasable pursuant to such Option divided by (z) the
number of shares of Vencor Common Stock subject to such Replacement Option.
The foregoing description of the Merger Amendment is qualified in its
entirety by the text of the Merger Amendment, which has been filed as Exhibit 9
to this Amendment and is incorporated herein by reference.
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Covenants. The Company has entered into amendments to the Warrant
agreements with each of the holders of the outstanding Warrants to provide that,
upon a merger of the Company, the holders of the Warrants will be entitled to
receive the number of shares, securities or other property that they would have
received if the Warrant had been exercised immediately prior to such merger. The
Warrant Reclassification will therefore be unnecessary.
Item 4. The Solicitation or Recommendation.
(b) Background
On February 28, 1997, the Board of Directors held a meeting to consider
the proposed amendment to the Merger Agreement regarding the treatment of the
Options in the Merger. The Board of Directors approved the form of amendment to
the Merger Agreement and authorized the authorized officers of the Company to
execute the Merger Amendment.
On February 28, 1997, the Company, Vencor and the Purchaser entered
into the Merger Amendment amending the Merger Agreement. The Merger Amendment is
more fully described above in Item 3 and is qualified in its entirety by the
text of the Merger Amendment, which has been filed as Exhibit 9 to this
Amendment and is incorporated herein by reference.
Item 9. Material to be Filed as Exhibits.
Exhibit 9 Amendment No. 1 to the Agreement and Plan of Merger, dated as of
February 28, 1997, among TheraTx, Incorporated, Vencor, Inc.
and Peach Acquisition Corp.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this Amendment is true, complete
and correct.
THERATX, INCORPORATED
Dated: March 3, 1997 /s/ Jonathan H. Glenn
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Name: Jonathan H. Glenn
Title: Vice President, General
Counsel and Secretary
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EXHIBIT 9
Amendment No. 1 to Agreement and Plan of Merger
AMENDMENT NO. 1, dated as of February 28, 1997 (this
"Amendment"), to the Agreement and Plan of Merger, dated as of February 9, 1997
(the "Merger Agreement"), by and between TheraTx, Incorporated, a Delaware
corporation (the "Company"), Vencor, Inc., a Delaware corporation ("Purchaser")
and Peach Acquisition Corp., a Delaware corporation and a wholly-owned
subsidiary of Purchaser ("Merger Sub").
W I T N E S S E T H:
WHEREAS, the Company, Purchaser and Merger Sub desire to
amend the Merger Agreement as set forth herein; and
WHEREAS, Section 10.3 of the Merger Agreement provides that,
at any time prior to the Effective Time, the Company, Purchaser and Merger Sub
may amend the Merger Agreement, by written agreement executed and delivered by
duly authorized officers of the Company, Purchaser and Merger Sub, respectively;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
ARTICLE I
Amendment to the Merger Agreement
2.1 Stock Plans and Options. Section 7.8 of the Merger
Agreement is hereby amended by deleting the current text thereof in
its entirety and inserting in lieu thereof the following:
7.8. Stock Plans and Options. (a) Except as provided in Section 7.8(b),
at the Effective Time, each outstanding option to purchase Shares under
the Stock Plans, other than any option granted under the Company's
Employee Stock Purchase Plan (collectively, the "Options"), whether
vested or unvested, shall be converted into an option to acquire, on
the same terms and conditions as were applicable under such Option, the
number of shares of Common Stock, par value $0.25 per share of
Purchaser (the "Purchaser Common Stock") equal to (a) the number of
Shares subject to the Option, multiplied by (b) (i) the Merger
Consideration, divided by (ii) the average of the high and low price
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of Purchaser Common Stock on the trading day immediately preceding
the date of the Effective Time as reported in the New York City
edition of The Wall Street Journal (rounded down to the nearest
whole number) (a "Replacement Option"), at an exercise price per
share (rounded up to the nearest whole cent) equal to (y) the
aggregate exercise price for the Shares which were purchasable
pursuant to such Option divided by (z) the number of full shares of
Purchaser Common Stock subject to such Replacement Option in
accordance with the foregoing. At or prior to the Effective Time, the
Company shall take all action necessary with respect to the Stock
Plans to permit the replacement of the outstanding Options by
Purchaser pursuant to this Section 7.8(a) and as soon as
practicable after the Effective Time Purchaser shall use its
reasonable best efforts to register under the Securities Act on Form
S-8 or other appropriate form (and use its reasonable best efforts
to maintain the effectiveness thereof) shares of Purchaser Common
Stock issuable pursuant to all Replacement Options. The Company
shall take all action necessary, including obtaining any required
consents from optionees, to provide that following the Effective
Time no participant in any Stock Plan or other plans, programs or
arrangements shall have any right thereunder to acquire equity
securities of the Company, the Surviving Corporation or any
subsidiary thereof and to permit Purchaser to assume the Stock Plans
(other than the Company's Employee Stock Purchase Plan, with respect
to which the Company shall take all action necessary to terminate
such plan immediately prior to the Effective Time). The Company
shall further take all action necessary to amend the Stock Plans,
to eliminate automatic grants or awards thereunder following the
Effective Time. At the Effective Time, Purchaser shall assume the
Stock Plans (other than the Company's Employee Stock Purchase
Plan); provided, that such assumption shall be only in respect
of the Replacement Options and that Purchaser shall have no
obligation with respect to any awards under the Stock Plans other
than the Replacement Options or to make any additional grants or
awards under such assumed Stock Plans.
(b) At the Effective Time, each then outstanding Option held by (i)
John A. Bardis, Bret W. Jorgensen, Donald R. Myll, Louis E. Hallman,
III, Laura E. Cayce, Jonathan H. Glenn, Craig R. Reamsnyder and B.
Wayne Clark, (ii) any individual in respect of whom the total number
of Shares subject to all Options held by such
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individual does not exceed 1,500 as of the Effective Time, or (iii)
any other individuals who the Company and Purchaser mutually agree
shall have their Options treated in accordance with the terms of
this Section 7.8(b), whether vested or unvested, shall be canceled
and the holder thereof shall be entitled to receive an amount of
cash equal to the product of (x) the amount, if any, by which the
Merger Consideration exceeds the exercise price per Share subject
to such Option (whether vested or unvested) and (y) the number of
Shares issuable pursuant to the unexercised portion of such Option,
less any required withholding of taxes (such amount being
hereinafter referred to as the "Option Consideration"). The Option
Consideration shall be paid as soon as practicable following the
Effective Time, but in any event within five (5) days following the
Effective Time. Prior to the Effective Time, the Company shall take
such actions as may be necessary to effectuate the foregoing,
including without limitation obtaining all applicable consents.
The cancellation of an Option in exchange for the Option
Consideration shall be deemed a release of any and all rights
the holder had or may have had in respect of such Option, and any
required consents received from Option holders shall so provide.
ARTICLE II
Miscellaneous
2.2 Definitions. Capitalized terms used in this Amendment and
not defined herein shall have the meanings ascribed to such terms in the Merger
Agreement.
2.3 Entire Agreement; Restatement. Other than as amended by
Section 1.1 above, the Merger Agreement shall remain in full force and effect
unaffected hereby. The Merger Agreement, as amended by this Amendment, is
hereinafter referred to as the "Merger Agreement", and the parties hereto hereby
agree that the Merger Agreement may be restated to reflect the amendments
provided for in this Amendment.
2.4 Governing Law. THIS AMENDMENT SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.
2.5 Counterparts. For the convenience of the parties
hereto, this Amendment may be executed in any number of counterparts, each such
counterpart being deemed to be an
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original instrument and all such counterparts shall together
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed or
caused this Amendment to be executed as of the date first written above.
THERATX, INCORPORATED
By: /s/ Jonathan H. Glenn
Name: Jonathan H. Glenn
Title: Vice President, General
Counsel and Secretary
VENCOR, INC.
By: /s/ James L. Gillenwater, Jr.
Name: James L. Gillenwater, Jr.
Title: Senior Vice President
PEACH ACQUISITION CORP.
By: /s/ James L. Gillenwater, Jr.
Name: James L. Gillenwater, Jr.
Title: Senior Vice President
