-----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, R0XHOJWRPnO6B87luSR6NItBl2JiuiEEZ/X07iO6CBXlu6+W9OSkcWiX4vcFg5to 4d+6tPN794dl3Q3r3TaTFw== 0000950136-98-001663.txt : 19980918 0000950136-98-001663.hdr.sgml : 19980918 ACCESSION NUMBER: 0000950136-98-001663 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980330 ITEM INFORMATION: ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980917 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEDLEY CREDIT ACCEPTANCE CORP CENTRAL INDEX KEY: 0001037271 STANDARD INDUSTRIAL CLASSIFICATION: SHORT-TERM BUSINESS CREDIT INSTITUTIONS [6153] IRS NUMBER: 133571419 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-22681 FILM NUMBER: 98711056 BUSINESS ADDRESS: STREET 1: 10910 NW SOUTH RIVER DR CITY: MIAMI STATE: FL ZIP: 33178 BUSINESS PHONE: 3054435002 MAIL ADDRESS: STREET 1: MEDLEY CREDIT ACCEPTANCE CORP STREET 2: 10910 NW SOUTH RIVER DR CITY: MIAMI STATE: FL ZIP: 33178 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) March 30, 1998 FINANTRA CAPITAL, INC. -------------------------------------------------- (Exact Name of Registrant as Specified in Charter) DELAWARE 000-22681 13-3571419 (State or Other Jurisdiction of (Commission File Number) (IRS Employer Incorporation) Identification No.) 1100 PONCE DE LEON BOULEVARD, CORAL GABLES, FLORIDA 33134 (Address of Principal Executive Offices) (Zip Code) (305) 443-5002 (Registrant's telephone number, including area code) ----------------- NOT APPLICABLE (Former Name or Former Address, if Changed Since Last Report) =============================================================================== ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. As previously reported in Finantra Capital, Inc.'s (the "Company's") Annual Report on Form 10-KSB for the year ended December 31, 1997, the Company, on March 30, 1998, acquired all of the outstanding capital stock of Medical Billing Service Systems, Inc., a Florida Corporation ("Medical Billing"), Premier Provider Services, Inc., a Florida corporation ("Premier"), and PPS Staffing, Inc. a Florida corporation ("PPS"). Each of Medical Billing, Premier and PPS (collectively, the "Medical Billing Subsidiaries") is engaged in providing back office auditing and other financial administrative services principally to the medical industry. The Company anticipates that its acquisition of the Medical Billing Subsidiaries will enable it to save the costs and expenses associated with either building internally, or outsourcing, such back office and administrative services. In consideration for the Company's acquisition of the Medical Billing Subsidiaries, the Company agreed to issue to the principals of the Medical Billing Subsidiaries an aggregate of 585,000 shares of the Company's common stock, $.01 par value per share (the "Common Stock"), each such share valued at $4.50, one-half of which were issued upon the closing of the acquisitions, with the remaining one-half of such shares being issuable on the first anniversary of such acquisitions. In addition, the Company agreed to issue to the principals of the Medical Billing Subsidiaries incentive stock options pursuant to the Company's 1997 Stock Option Plan to acquire, through December 31, 2001, under certain circumstances, up to an aggregate of 150,000 additional shares of Common Stock based upon the Medical Billing Subsidiaries' future financial performance. The principals of the Medical Billing Subsidiaries were also issued three year employment contracts. Historical and pro forma financial information regarding the Company and each of the Medical Billing Subsidiaries is set forth in Item 7 of this Current Report on Form 8-K. ITEM 5. OTHER EVENTS. On August 7, 1998, the Company commenced a private offering (the "Offering") to accredited investors (as defined in the Securities Act of 1933, as amended) of a maximum of 600,000 units (the "Units"), each Unit being comprised of one share of Common Stock and one redeemable Common Stock purchase warrant (the "Warrant"). Each Unit is being offered and sold by the Company for $2.75. Each Warrant entitles the holder thereof to purchase one share of Common Stock for $4.125, subject to adjustment, through February 1, 2002. The Warrants, however, are not exercisable unless, at the time of exercise, the shares of Common Stock underlying the Warrants have been registered, qualified or deemed to be exempt from the registration requirements of the laws of the state of residence of the holder of such Warrants. The - 1 - Warrants are redeemable by the Company for $.25 per Warrant on 30 days' prior written notice if the average reported closing price for shares of the Company's Common Stock for the 20 consecutive trading days prior to the notice of redemption equals or exceeds $6.1875. The Offering is being conducted by the Company on a best efforts basis and will continue until the earlier of the date that all 600,000 Units have been sold or November 1, 1998. The Company has reserved the right, however, to extend the Offering until January 4, 1999. The net proceeds to the Company from the sale of all 600,000 Units, after deducting offering expenses, is estimated to be $1,635,000. Since there is no minimum number of Units which must be sold in the Offering, the Company will utilize subscription proceeds upon acceptance. The Company intends to utilize the net proceeds from the Offering to provide working capital for the Company's factoring, leasing and mortgage operations, and for general corporate purposes, including acquisitions. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (a) Historical financial information regarding the Company and each of the Medical Billings Subsidiaries is set forth on pages F-1 through F-6 hereto. (b) Pro forma financial information regarding the Company, and each of the Medical Billing Subsidiaries is set forth on pages F-1 through F-6 hereto. - 2 - FINANTRA CAPITAL, INC. PROFORMA COMBINED BALANCE SHEETS DECEMBER 31, 1997 ASSETS ------
MEDICAL BILLING PREMIER FINANTRA SERVICE PROVIDER PPS PROFORMA CAPITAL, SYSTEMS, SERVICES, STAFFING, ADJUST- PROFORMA INC. INC. INC. INC. MENTS COMBINED ---------- ---------- ---------- ---------- --------- ---------- Current Assets: Cash ........................................ $4,106,803 $ 2,536 $ 47,882 $ 28,166 $ -- $4,185,387 Accounts receivable, net of allowance for doubtful accounts of $3,000 in 1997 ...... 45,661 200,110 180,025 179,245 -- 605,041 Finance receivable .......................... 500,000 -- -- -- -- 500,000 Prepaid expenses ............................ -- -- 5,444 10,650 -- 16,094 Consulting agreement ........................ 120,000 -- -- -- -- 120,000 ---------- ---------- ---------- ---------- ---------- ---------- Total current assets .................. 4,772,464 202,646 233,351 218,061 -- 5,426,522 ---------- ---------- ---------- ---------- ---------- ---------- Rental equipment, at cost, net ........ 69,959 -- -- -- -- 69,959 ---------- ---------- ---------- ---------- ---------- ---------- Property and equipment, at cost, net .. 7,995 41,691 18,297 4,157 -- 72,140 ---------- ---------- ---------- ---------- ---------- ---------- Other assets: Goodwill ........................... -- -- -- -- (A) 1,369,796 1,369,796 Due from affiliates ................ 75,413 -- -- -- -- 75,413 Deposits and consulting agreement .. 30,000 485 2,692 -- -- 33,177 ---------- ---------- ---------- ---------- ---------- ---------- Total other assets .................... 105,413 485 2,692 -- 1,369,796 1,478,386 ---------- ---------- ---------- ---------- ---------- ---------- Total assets .......................... $4,955,831 $ 244,822 $ 254,340 $ 222,218 $1,369,796 $7,047,007 ========== ========== ========== ========== ========== ==========
F-1 FINANTRA CAPITAL, INC. PROFORMA COMBINED BALANCE SHEETS DECEMBER 31, 1997 LIABILITIES AND STOCKHOLDERS' EQUITY
MEDICAL BILLING PREMIER FINANTRA SERVICE PROVIDER PPS PROFORMA CAPITAL, SYSTEMS, SERVICES, STAFFING, ADJUST- PROFORMA INC. INC. INC. INC. MENTS COMBINED ---------- ---------- ---------- ---------- --------- --------- Current liabilities: Notes payable ..................................... $ 140,525 $ -- $ -- $ -- $ -- $140,525 Current portion of long-term debt ................. 107,495 -- -- -- -- 107,495 Current portion of obligations to finance companies ...................................... 50,754 -- -- -- -- 50,754 Current portion of capital lease obligation ..................................... -- 22,008 2,773 -- -- 24,781 Accounts payable and accrued expenses ............. 364,246 17,148 19,020 13,414 -- 413,828 Customer deposits ................................. -- -- 5,509 -- -- 5,509 Dividends payable - preferred stock ............... 1,278 -- -- -- -- 1,278 Distributions payable ............................. -- -- 45,000 -- -- 45,000 Income taxes payable - current .................... -- -- -- 460 (B) (460) -- Deferred tax liability ............................ -- -- -- 65,500 (B) (65,500) -- --------- --------- --------- --------- --------- -------- Total current liabilities ................... 664,298 39,156 72,302 79,374 (65,960) 789,170 --------- --------- --------- --------- --------- -------- Other liabilities: Long-term debt, net of current portion ... 60,000 -- -- -- -- 60,000 Obligations to finance companies, net of current portion ....................... 26,913 -- -- -- -- 26,913 Capital Lease obligation ................. -- 3,997 5,331 -- -- 9,328 --------- --------- --------- --------- --------- -------- Total other liabilities ............ 86,913 3,997 5,331 -- -- 96,241 --------- --------- --------- --------- --------- -------- Total liabilities ........................... $ 751,211 $ 43,153 $ 77,633 $ 79,374 $ (65,960) $885,411 ========= ========= ========= ========= ========= ========
F-2 FINANTRA CAPITAL, INC. PROFORMA COMBINED BALANCE SHEETS DECEMBER 31, 1997 LIABILITIES AND STOCKHOLDERS' EQUITY
MEDICAL BILLING PREMIER FINANTRA SERVICE PROVIDER PPS PROFORMA CAPITAL, SYSTEMS, SERVICES, STAFFING, ADJUST- PROFORMA INC. INC. INC. INC. MENTS COMBINED ---------- ---------- ---------- ---------- --------- --------- Stockholders' Equity: Series A 10% redeemable convertible preferred stock, $.01 par value, 5,000,000 authorized, 2,958,817 shares issued and outstanding (liquidation value of $2,958,817 plus accumulated dividends) ................. $ 29,588 -- -- -- $ 29,588 Common stock, $.01 par value, 10,000,000 shares authorized, 3,102,266 shares issued and outstanding in 1997 ................... 26,674 -- -- -- (C) 4,349 31,023 Common stock, $1 par value,100 shares authorized and outstanding ...... -- 100 100 100(D) (300) -- Additional paid-in capital ................ 6,947,803 -- -- -- (C) 1,952,627 8,900,430 Accumulated deficit ....................... 2,799,445 201,569 176,607 142,744(D) (520,920) (2,799,445) ----------- ----------- ----------- ----------- ----------- ----------- Total stockholders' equity ....... 4,204,620 201,669 176,707 142,844 1,435,756 6,161,596 ----------- ----------- ----------- ----------- ----------- ----------- Total liabilities and stockholders equity ........................... $ 4,955,831 $ 244,822 $ 254,340 $ 222,218 $ 1,369,796 $ 7,047,007 =========== =========== =========== =========== =========== ===========
F-3 FINANTRA CAPITAL, INC. PROFORMA COMBINED STATEMENTS OF OPERATIONS YEAR ENDED DECEMBER 31, 1997
MEDICAL BILLING PREMIER FINANTRA SERVICE PROVIDER PPS PROFORMA CAPITAL, SYSTEMS, SERVICES, STAFFING, ADJUST- PROFORMA INC. INC. INC. INC. MENTS COMBINED ---------- ---------- ---------- ---------- --------- --------- Revenues: Leasing income .............................. $ 148,589 $ -- $ $ -- $ 148,589 Factoring income ............................ 46,579 -- -- -- -- 46,579 Fee income .................................. -- 851,680 382,284 1,071,845 -- 2,305,809 Interest income ............................. 97,368 -- -- -- -- 97,368 ----------- ----------- ----------- ----------- --------- Total revenues ........................ 292,536 851,680 382,284 1,071,845 -- 2,598,345 --------- ----------- ----------- ----------- ----------- --------- Cost and expenses: Depreciation ....................... 83,115 14,211 1,778 462 -- 99,566 Interest expense ................... 76,050 5,476 904 -- -- 82,430 Loss on sale/disposal of lease equipment ........................ 162,567 -- -- -- -- 162,567 General and administrative expense . 626,294 641,101 299,062 862,679 -- 2,429,136 --------- ----------- ----------- ----------- ----------- --------- Total costs and expenses .............. 948,026 660,788 301,744 863,141 -- 2,773,699 --------- ----------- ----------- ----------- ----------- --------- (Loss) income from operations ......... (655,490) 190,892 80,540 208,704 -- (175,354) --------- ----------- ----------- ----------- ----------- --------- Other income (expenses): Loss on sale of securities available for sale ......................... (40,580) -- -- -- -- (40,580) --------- ----------- ----------- ----------- ----------- --------- Total other income (expenses) (40,580) -- -- -- -- (40,580) --------- ----------- ----------- ----------- ----------- --------- Provision for income taxes ... -- -- -- (65,960)(B) 65,960 -- ---------- ----------- ----------- ----------- ----------- ---------
(Continued on next page) F-4 FINANTRA CAPITAL, INC. PROFORMA COMBINED STATEMENTS OF OPERATIONS YEAR ENDED DECEMBER 31, 1997 (Continued from previous page)
MEDICAL BILLING PREMIER FINANTRA SERVICE PROVIDER PPS PROFORMA CAPITAL, SYSTEMS, SERVICES, STAFFING, ADJUST- PROFORMA INC. INC. INC. INC. MENTS COMBINED ---------- ---------- ---------- ---------- --------- --------- MEDICAL Net (loss) income: ($696,070) $190,892 $ 80,540 $142,744 $ 65,960 ($215,934) ========= ======== ======== ======== ======== ========= Net (loss) income applicable to common shareholders ($512,043) Net (loss) income per common share (basic and diluted) $ (.24) ========= Weighted average number of shares outstanding (basic and diluted) 2,133,491 =========
F-5 FINANTRA CAPITAL, INC. NOTES TO PROFORMA COMBINED FINANCIAL STATEMENTS DECEMBER 31, 1997 (A) The purchase price for the acquisition of all the common stock of Premier Provider Services, Inc., is approximately $322,000, for PPS Staffing, Inc., is approximately $835,000 and for Medical Billing Services, Inc., is $800,000. Goodwill has been recorded of approximately $1,370,000 for the above purchased companies. The acquisition have been accounted for under the purchase method of accounting. (B) To adjust the income taxes to reflect the combined net operating loss. (C) To reflect the issuance of capital stock of $4.50 per share based upon the purchase price of the companies. (D) To eliminate the retained earnings of the acquired companies included in the purchase price. F-6 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FINANTRA CAPITAL, INC. ---------------------- (Registrant) Dated: September 16, 1998 By: /s/ Robert D. Press ------------------------ Robert D. Press, President - 3 - -----END PRIVACY-ENHANCED MESSAGE-----