-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QFTKhL3CNu6e9j2Foy5plDPiWUf0zuQ9I0nGne7mEpmWdFy9pp9uWJQVUkhMmblB TkCugsNua9EWgm7FgnvcwQ== 0001047469-99-037047.txt : 19991227 0001047469-99-037047.hdr.sgml : 19991227 ACCESSION NUMBER: 0001047469-99-037047 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990913 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990928 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INNOVATIVE CLINICAL SOLUTIONS LTD CENTRAL INDEX KEY: 0001002022 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISC HEALTH & ALLIED SERVICES, NEC [8090] IRS NUMBER: 650617076 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-27568 FILM NUMBER: 99718629 BUSINESS ADDRESS: STREET 1: 10 DORRANCE STREET STREET 2: SUITE 400 CITY: PROVIDENCE STATE: RI ZIP: 02903 BUSINESS PHONE: 4018316755 MAIL ADDRESS: STREET 1: 10 DORRANCE STREET STREET 2: SUITE 400 CITY: PROVIDENCE STATE: RI ZIP: 02903 FORMER COMPANY: FORMER CONFORMED NAME: PHYMATRIX CORP DATE OF NAME CHANGE: 19951229 FORMER COMPANY: FORMER CONFORMED NAME: CONTINUUM CARE CORP DATE OF NAME CHANGE: 19951010 8-K 1 FORM 8-K 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): SEPTEMBER 13, 1999 INNOVATIVE CLINICAL SOLUTIONS, LTD. ----------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 000-27568 65-0617076 ---------------------------- --------------- --------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 10 DORRANCE STREET, SUITE 400, PROVIDENCE, RHODE ISLAND 02903 ------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (401) 831-6755 -------------- N/A -------------------------------------------------------------- (Former name or former address, if changed since last report.) ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS On September 13, 1999, certain wholly-owned subsidiaries of Innovative Clinical Solutions, Ltd. (collectively, the "ICSL Group") sold certain assets involved in their diagnostic imaging line of business, including equipment, leasehold interests and contract rights but excluding cash and accounts receivable (the "Diagnostic Assets"), to PresGar Imaging, L.C., and certain of its affiliates (collectively, "PresGar"), for an aggregate purchase price of approximately $27,348,450 in cash and the assumption of approximately $4 million of debt. The purchase price received by the ICSL Group in the transaction was determined as the result of arm's-length negotiations between the ICSL Group and the principals of PresGar. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION The following Unaudited Pro Forma Consolidated Statements of Operations for the six months ended July 31, 1999 and the year ended January 31, 1999 have been prepared to reflect the sale of the Diagnostic Assets as well as the sale or disposition since October 1998 by certain subsidiaries of Innovative Clinical Solutions, Inc. (the "Company") of certain other assets relating to their diagnostic imaging, infusion therapy, lithotripsy services, real estate services and radiation therapy businesses, and physician practices, as if the sales or dispositions had been completed on February 1, 1998. The Unaudited Pro Forma Consolidated Balance Sheet at July 31, 1999 gives effect to the sale of the Diagnostic Assets and the other sales or dispositions completed since that date as if such sales or dispositions had occurred on July 31, 1999. The Unaudited Pro Forma Consolidated Financial Information has been prepared based on the audited and unaudited historical financial statements of the Company, and such Unaudited Pro Forma Consolidated Financial Information should be read in conjunction with the consolidated historical financial statements and related notes contained in the annual and quarterly reports filed with the Securities and Exchange Commission. The Unaudited Pro Forma Consolidated Financial Information has been prepared in accordance with generally accepted accounting principles. These principles require management to make extensive use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Unaudited Pro Forma Consolidated Statements of Operations are not necessarily indicative of future operating results. INNOVATIVE CLINICAL SOLUTIONS, LTD. PROFORMA CONSOLIDATED BALANCE SHEET JULY 31, 1999 UNAUDITED
Adjusted July 31, Total Pro Forma July 31, 1999 Adjustments(1) 1999 (unaudited) (unaudited) (unaudited) ----------- --------------- ----------- ASSETS Current assets Cash and cash equivalents $ 14,709 $27,500 $ 42,209 Receivables: Accounts receivable, net 18,079 7,790 25,869 Income tax refund receivable 10,789 0 10,789 Other receivables 6,314 0 6,314 Notes receivable 3,630 0 3,630 Prepaid expenses and other (including advances to shareholder) 12,337 0 12,337 Assets held for sale 45,133 (36,281) 8,852 ------------------------------------------ Total current assets 110,991 (991) 110,000 Property, plant and equipment, net 9,543 0 9,543 Notes receivable 8,481 0 8,481 Goodwill, net 28,525 0 28,525 Management service agreements, net 9,012 0 9,012 Other assets 3,931 0 3,931 ------------------------------------------ Total assets $170,483 ($991) $169,492 ------------------------------------------ ------------------------------------------ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Current portion of debt and capital leases 19,493 (3,833) 15,660 Accounts payable 13,236 0 13,236 Accrued compensation 2,147 0 2,147 Accrued and other liabilities 14,914 2,842 17,756 ------------------------------------------ Total current liabilities 49,790 (991) 48,799 Long-term debt less current maturities 4,311 0 4,311 Convertible subordinated debentures 100,000 0 100,000 Other long-term liabilities 940 0 940 Minority interest 673 0 673 ------------------------------------------ Total liabilities 155,714 (991) 154,723 Commitments and contingencies Shareholders' equity Common Stock 325 0 325 Treasury Stock (2,037) 0 (2,037) Additional paid in capital 224,778 0 224,778 Accumulated deficit (208,297) 0 (208,297) ------------------------------------------- Total shareholders' equity 14,769 0 14,769 Total liabilities and shareholders equity $170,483 ($991) $169,492 ------------------------------------------ ------------------------------------------
(1) The pro forma adjustments principally reflect the proceeds received on the sale of the dispositions as well as the paydown on the Company's line of credit. In addition, accounts receivable to be collected and liabilities retained by the Company for the disposed entities have been reclassified out of assets held for sale to the respective balance sheet accounts. INNOVATIVE CLINICAL SOLUTIONS, LTD. UNAUDITED PROFORMA CONSOLIDATED STATEMENT OF OPERATIONS SIX MONTHS ENDED JULY 31, 1999 (UNAUDITED)
TOTAL TOTAL ADJUSTED SIX MONTHS TOTAL PRO FORMA SIX MONTHS JULY 31, 1999 ADJUSTMENTS(2) JULY 31, 1999 (unaudited) (unaudited) (unaudited) ------------- ------------------- -------------- Total revenue $110,516 $28,741 $81,775 Operating costs and administrative expenses: Salaries, wages and benefits 35,652 9,084 26,568 Professional fees 9,422 996 8,426 Supplies 24,776 7,390 17,386 Utilities 2,346 595 1,751 Depreciation and amortization 6,813 3,301 3,512 Rent 8,699 2,520 6,179 Provision for bad debts 1,664 210 1,454 Non-recurring expenses 15,825 0 15,825 Capitation expense 24,310 0 24,310 Other 16,915 4,422 12,493 ----------------------------------------------- Total operating costs and administrative expenses 146,422 28,518 117,904 ----------------------------------------------- Interest expense, net 4,718 346 4,372 ----------------------------------------------- Loss before extraordinary item and provision for income taxes (40,624) (123) (40,501) Income tax expense 100 0 100 ----------------------------------------------- Net loss before extraordinary item $(40,724) $(123) $(40,601) ----------------------------------------------- -----------------------------------------------
(2) Pro forma adjustments reflect the historical results of the disposed entities for the relevant period. INNOVATIVE CLINICAL SOLUTIONS, LTD. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 1999
TOTAL TOTAL ADJUSTED YEAR ENDED TOTAL PRO FORMA YEAR ENDED JANUARY 31, 1999 ADJUSTMENTS(2) JANUARY 31, 1999 (unaudited) (unaudited) ---------------- --------------- ---------------- Total revenue $291,278 $102,392 $188,886 Operating costs and administrative expenses: Salaries, wages and benefits 94,710 30,902 63,808 Professional fees 16,287 2,540 13,747 Supplies 60,055 25,214 34,841 Utilities 5,501 2,073 3,428 Depreciation and amortization 14,786 8,091 6,695 Rent 20,671 7,886 12,785 Provision for bad debts 8,428 4,371 4,057 Gain/loss on sale of assets (5,414) 262 (5,676) Provision for write-down of notes receivable 2,674 0 2,674 Goodwill impairment write-down 9,093 9,093 0 Nonrecurring expenses 10,465 2,912 7,553 Capitation expense 53,875 0 53,875 Other 37,667 11,759 25,908 ------------------------------------------ Total operating costs and administrative expenses 328,798 105,103 223,695 ------------------------------------------ Interest expense, net 8,005 613 7,392 ------------------------------------------ Loss before extraordinary item and provision for income taxes (45,525) (3,324) (42,201) Income tax benefit (11,549) 0 (11,549) ------------------------------------------ Loss before extraordinary item $(33,976) $(3,324) $(30,652) ------------------------------------------ ------------------------------------------
(2) Pro forma adjustments reflect the historical results of the disposed entities for the relevant period. 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 hereunto duly authorized. INNOVATIVE CLINICAL SOLUTIONS, LTD. By: /s/ GARY S. GILLHEENEY ----------------------------- Gary S. Gillheeney Chief Financial Officer Date: September 28, 1999 -----END PRIVACY-ENHANCED MESSAGE-----