SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): DECEMBER 12, 1996
(DECEMBER 12, 1996)
ENVIROTEST SYSTEMS CORP.
(Exact name of registrant as specified in its charter)
DELAWARE 0-21454 06-0914220
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
ENVIROTEST TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 33-57384-01, 033-75406-01 36-2680300
(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification Number)
246 SOBRANTE WAY
SUNNYVALE, CALIFORNIA 94086
(408) 481-3900
(Address, including zip code, and telephone number, including area code of
registrant's principal executive offices)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
Not Applicable
ITEM 2. ACQUISITION OF ASSETS
Not Applicable
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Not Applicable
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANTS
Not Applicable
ITEM 5. OTHER EVENTS
On December 12, 1996 Envirotest Systems Corp. (the "Company or
Envirotest") announced that it has sold its right to receive the two
remaining installment payments totaling $80 million in principal amount due
to the Company under its Settlement Agreement with the Commonwealth of
Pennsylvania for approximately $79,405,000. The Company retained the right
to receive accrued interest of approximately $1,749,000 payable on July 31,
1997.
The proceeds received by the Company represent the value of the remaining
installment payments due Envirotest under the General Release and Settlement
Agreement, dated December 15, 1995, which settled the claims of Envirotest
arising from suspension of its contract to perform vehicle emissions testing
services in the Commonwealth. The Settlement Agreement required Pennsylvania
to pay Envirotest an aggregate of $145 million in four installments with
interest at the rate of 6% accruing from December 1995. Envirotest has
received the first two installments totaling $65 million plus interest. The
rights to receive the future payments from the Commonwealth of $40 million
each plus interest in July 1997 and 1998, less accrued interest of $1,749,000
due at the time of closing of the transaction, were sold by the Company.
The Settlement Agreement also requires Envirotest to use its best efforts
to dispose of the assets it acquired to perform vehicle emissions testing
services in Pennsylvania. If the net proceeds received by the Company from
the sale of the assets is less than $55 million, Pennsylvania is obligated to
pay Envirotest fifty percent of the difference up to $11 million no later
than July 31, 1998. The amount of this contingent payment was reduced from
$15 million in an amendment to the Settlement Agreement that permitted the
Company to complete the sale transaction. The Company has retained its right
to receive proceeds upon the sale of the assets.
ITEM 6. RESIGNATION OF REGISTRANT'S DIRECTORS
Not Applicable
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Not Applicable
ITEM 8. CHANGE IN FINANCIAL YEAR
Not Applicable
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
ENVIROTEST SYSTEMS CORP.
ENVIROTEST TECHNOLOGIES, INC.
Dated: December 12, 1996 By: /s/ C. Michael Alston
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Name: C. Michael Alston