United States
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): July 2, 2001
ENCORE MEDICAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
000-26538 65-0572565
(Commission File Number) (IRS Employer Identification No.)
9800 Metric Blvd., Austin, Texas 78758
(Address of principal executive offices) (Zip Code)
512-832-9500
Registrant's telephone number, including area code
ITEM 2. ACQUISITION OF ASSETS.
On July 2, 2001, Encore Medical Corporation, a Delaware corporation (the
"Company"), pursuant to that certain Asset Purchase Agreement (the "Agreement")
dated as of July 2, 2001 between the Company, Tecnol, Inc., a Delaware
corporation ("Tecnol"), Kimberly-Clark Corporation, a Delaware corporation
("KCC"), and Kimberly-Clark Worldwide, Inc., a Delaware corporation ("KCW" and,
together with Tecnol and KCC, "Kimberly-Clark"), acquired Kimberly-Clark's line
of orthopedic soft goods, patient safety devises and pressure care products
(collectively, the "Products").
The Agreement is set forth in Exhibit 1 to this Form 8-K and is
incorporated herein in its entirety by reference in response to this Item. The
description of the terms and provisions of the Agreement is a summary only, and
is qualified in its entirety by reference to such document.
Pursuant to the Agreement, the Company acquired Kimberly-Clark's hard
assets, inventory, customer lists, transferable licenses and intellectual
property related to the production of the Products for a total purchase price of
$8,835,206, consisting of $5,700,000 in cash and a promissory note in the amount
of $3,135,206 bearing interest at 8% per annum and payable over 24 months. The
purchase price is, at the Company's option, subject to adjustment if the Company
makes a final valuation of the acquired inventory as of the closing date. The
Company negotiated the purchase price of the Products with Kimberly-Clark based
on the historic sales figures for the Products.
In connection with the Agreement, the Company and Kimberly-Clark entered
into (i) a transition agreement, which obligates Kimberly-Clark to assist the
Company with the transfer of the manufacturing knowledge and business and
customer service systems information related to the Products and to assist with
the transfer of the relationships with Kimberly-Clark's customer base who
purchases the Products, and (ii) a noncompetition agreement, which prevents
Kimberly-Clark from producing or marketing products similar to the Products for
a period of five years.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The following exhibits are filed herewith:
Exhibit 1. Asset Purchase Agreement dated as of July 2, 2001 between
Encore Medical Corporation, Tecnol, Inc., Kimberly-Clark Corporation and
Kimberly-Clark Worldwide, Inc.
Exhibit 2. Press Release of Encore Medical Corporation dated July 3, 2001.
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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.
Date: July 17, 2001
ENCORE MEDICAL CORPORATION
By /s/ HARRY L. ZIMMERMAN
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Harry L. Zimmerman,
Executive Vice President-General Counsel
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