Rennova Health, Inc. (NASDAQ:RNVA) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On May 30, 2019, Rennova Health, Inc. (the “Company”) and Christopher Diamantis, a director of the Company, entered into an amendment of the previously-announced settlement agreement with regard to the arbitration proceeding related to the sale on March 31, 2016 of certain disputed accounts receivable. Under the settlement agreement, the Company and Mr. Diamantis agreed to make a payment of $2,000,000 on or before April 5, 2019 (which was made by Mr. Diamantis) and an additional payment of $7,694,685 plus interest at 10% per annum on or before May 20, 2019. Under an earlier amendment, the second payment date was deferred and the Company and Mr. Diamantis agreed to pay $7,807,549 plus interest at 10% per annum on or before May 30, 2019.
Under the May 30, 2019 amendment, the Company and Mr. Diamantis agreed to make a payment of $3,000,000 on or before May 31, 2019 (which was made by Mr. Diamantis) and an additional payment of $4,937,105 on or before July 28, 2019. The Company is obligated to repay Mr. Diamantis the $5,000,000 he has paid to date and, to the extent Mr. Diamantis makes any of the remaining payment on behalf of the Company, it will be obligated to repay him that amount as well. In the event the remaining payment is not timely made, the Company and Mr. Diamantis will be required to pay $6,997,391, plus interest (less any portion of the remaining payment that is timely made).
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On May 30, 2019, John Beach resigned as a director of the Company. In submitting his resignation; Mr. Beach did not express any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Mr. Beach had served as a director since October 11, 2017.
Item 8.01 Other Events.
Following an inspection at Jamestown Regional Medical Center on February 5, 2019, the hospital was informed on February 15 that several conditions of participation in the CMS-approved Medicare accreditation program were deficient. The hospital was informed that if the deficiencies where not corrected by May 16 the Medicare agreement would terminate. A follow-up inspection on May 15 resulted in the determination that the hospital had failed to adequately correct the deficiencies highlighted and a notice of involuntary termination was issued that is effective on June 12, 2019. The Company is considering its options to appeal this decision and/or take whatever corrective action is necessary to maintain or re-enter the Medicare program.
About Rennova Health, Inc. (NASDAQ:RNVA)
Rennova Health, Inc. (Rennova), formerly CollabRx, Inc., is a provider of diagnostics and supportive software solutions to healthcare providers. The Company operates in three segments: clinical laboratory operations, supportive software solutions, and decision support and informatics operations. The Company is a healthcare enterprise that delivers products and services, including laboratory diagnostics, healthcare technology solutions, and revenue cycle management and intends to provide financial services, to medical providers. Rennova’s principal line of business is clinical laboratory blood and urine testing services. It is also engaged in the provision of urine drug toxicology testing to physicians, clinics and rehabilitation facilities in the United States. Its clinical laboratories include Biohealth Medical Laboratory, Inc.; Alethea Laboratories, Inc.; International Technologies, LLC; EPIC Reference Labs, Inc., and Epinex Diagnostics Laboratories, Inc.