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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K/A
(Amendment #1)
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of Report (Date of earliest event reported):
February 17, 1998
OSMONICS, INC.
(Exact name of Registrant as specified in its charter)
Minnesota 1-12714 41-0955759
(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification
incorporation) No.)
5951 Clearwater Drive,
Minnetonka, Minnesota 55343-8995
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(612) 933-2277
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FORM 8-K/A
ITEM 2. ACQUISITION OF ASSETS.
On February 17, 1998, Osmonics, Inc. (the _Company_)
completed the acquisition of all of the shares (the
_Acquired Shares_) of Micron Separations, Inc., a New York
corporation (_MSI_). MSI, located in Westborough,
Massachusetts, is a developer, manufacturer and marketer of
microfilter membrane products for laboratory, diagnostic,
and industrial use. MSI revenues were less than $15 million
in each of the last three years.
MSI filed a voluntary petition for reorganization under
Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the District of Massachusetts on April
9, 1997, Case No. 97-42342-JFQ. On December 15, 1997,
pursuant to Chapter 11 of the Bankruptcy Code, MSI and the
Company submitted a Joint Plan of Reorganization (the
_Plan_). The Plan was confirmed by the United States
Bankruptcy Court on January 28, 1998. Pursuant to Article
VII of the Plan, MSI's existing equity securities were
canceled and Osmonics received the Acquired Shares. The
Acquired Shares consist of 1,000 shares of common stock of
the reorganized MSI, which represents 100% of the
outstanding voting securities of MSI.
Under the Plan, Osmonics will provide up to $28 million
(in addition to MSI's cash), for the payment in full of all
MSI's creditors and payment to holders of MSI's equity
securities. The aggregrate consideration to be paid to
holders of MSI's equity securities will not exceed
$15,200,000 which amount will be adjusted based upon the
final amount of claims of MSI's creditors under Section 1.16
of the Plan and, pursuant to Section 3.5 of the Plan, is
subject to set-off rights and a hold back of 10% of the
consideration finally determined to be payable to such
holders. In addition, pursuant to Section 3.5c of the Plan
holders of MSI's equity securities are entitled to receive
the amount, if any, of any recovery in a certain lawsuit,
less expenses.
On February 17, 1998, the Company pursuant to the Plan
paid James S. Johnson and John Greenwood, both founders and
significant shareholders, and certain other shareholders
(the _Sellers_) $13,633,500 in cash consideration for the
Acquired Shares. The Company will pay up to $1,515,350 in
cash to the Sellers one year from the acquisition date
subject to certain adjustments and set off rights under the
Plan as described above.
The Company also made a capital contribution of
$10,000,000 in cash to MSI on February 17, 1998 pursuant to
the Plan to facilitate MSI's payment of various creditors
pursuant to the Plan. Finally, James S. Johnson and John
Greenwood will be paid a total of $300,000 pursuant to
consulting and non-competition agreements executed in
connection with the transaction.
FINANCING FOR THE ACQUISITION
The Company financed the acquisition (approximately
$25,000,000) through expanded interim financing arrangements
in the form of a revolving line of credit from a commercial
bank.
DESCRIPTION OF ACQUIRED BUSINESS
Micron Separations, Inc. is a prominent developer,
manufacturer, and marketer of microfilter membrane products
for laboratory, diagnostic, and industrial use. MSI
provides a full line of microfiltration (MF) membranes to
complement the Company's existing complete line of
ultrafiltration (UF), NF and RO membranes. This includes
nylon membranes 6,6 and 4,6 which are among the most
hydrophilic microfiltration membranes available, and are
widely used in food, beverage and biotech filtration. The
acquisition positions the Company as a more significant
player in the laboratory and diagnostics markets, while
significantly expanding its capabilities in the pleated
membrane cartridge business.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
A. FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.
Financial Statements required by this Item 7(a) of MSI
will not be filed with the Securities and Exchange
Commission on Form 8-K or Form 8-K/A. The acquisition
does not exceed the threshold requiring such disclosure
as detailed in Regulation S-X, paragraph 305(b).
B. PRO FORMA FINANCIAL INFORMATION.
Pro forma financial information required by this Item
7(b) of the Company and MSI will similarly not be filed
with the Securities and Exchange Commission on Form 8-K
or Form 8-K/A. The acquisition does not exceed the
threshold requiring such disclosure as documented in
Regulation S-X, Article 11.
C. EXHIBITS.:
The following documents were included as an exhibit to
Form 8-K, filed March 4, 1998, and are incorporated
herein by reference:
EXHIBIT NO. DESCRIPTION
2.1 First Amended Disclosure Statement to Joint Plan
of reorganization Submitted by Micron Separations,
Inc. and Osmonics, Inc. are incorporated herein by
reference to Form 8-K filed on March 4, 1998.
2.2 Joint Plan of Reorganization submitted by Micron
Separations, Inc. and Osmonics, Inc., dated
December 15, 1997 with Exhibit C are incorporated
herein by reference to Form 8-K filed on March 4,
1998.
Certain related transaction documents and exhibits (the
_Exhibits_) to the First Amended Disclosure Statement are
not being filed herewith. The Registrant undertakes to
furnish a copy of any omitted Exhibit to the Commission upon
request. Pursuant to Item 601(b)(2) of Regulation S-K, the
following is a list of the omitted Exhibits and Schedules.
Exhibit A - Liquidation Analysis
Certain related transaction documents and exhibits (the
_Exhibits_) to the Joint Plan are not being filed herewith.
The Registrant undertakes to furnish a copy of any omitted
Exhibit to the Commission upon request. Pursuant to Item
601(b)(2) of Regulation S-K, the following is a list of the
omitted Exhibits and Schedules.
Exhibit A - Form of Micron Separations, Inc. Equity
Interests Trust Agreement.
Exhibit B - Form of Settlement Agreement between Pall
Corporation and Micron Separations, Inc.
Exhibit C - List of Assumed Leases filed with the
Bankruptcy Court.
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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.
OSMONICS, INC.
Date: April 26, 1998 By: /s/ D. Dean Spatz
D. Dean Spatz
Chief Executive Officer