-----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, MKHH8Z82u2cKkmsI1oqNk7QUsUH0CEhuhwQY3PkArx5Y02z6A409/CVNGruWou4o ju6kCccf50ohEEKdoCJAew== 0000912057-01-505854.txt : 20010402 0000912057-01-505854.hdr.sgml : 20010402 ACCESSION NUMBER: 0000912057-01-505854 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010330 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010330 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEALTH NET INC CENTRAL INDEX KEY: 0000916085 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE CARRIERS, NEC [6399] IRS NUMBER: 954288333 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-12718 FILM NUMBER: 1587548 BUSINESS ADDRESS: STREET 1: 21650 OXNARD ST CITY: WOODLAND HILLS STATE: CA ZIP: 91367 BUSINESS PHONE: 8186766000 MAIL ADDRESS: STREET 1: 21650 OXNARD ST CITY: WOODLAND HILLS STATE: CA ZIP: 91367 FORMER COMPANY: FORMER CONFORMED NAME: FOUNDATION HEALTH SYSTEMS INC DATE OF NAME CHANGE: 19970513 FORMER COMPANY: FORMER CONFORMED NAME: HEALTH SYSTEMS INTERNATIONAL INC DATE OF NAME CHANGE: 19940207 FORMER COMPANY: FORMER CONFORMED NAME: HN MANAGEMENT HOLDINGS INC/DE/ DATE OF NAME CHANGE: 19931213 8-K 1 a2043742z8-k.txt 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, 2001 -------------- HEALTH NET, INC. ----------------- (Exact Name of Registrant as Specified in Charter) DELAWARE 1-12718 95-4288333 ------------- ------------- ------------- (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.) 21650 OXNARD STREET, WOODLAND HILLS, CALIFORNIA 91367 ------------------------------------------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (818) 676-6000 -------------- - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) 1 Item 5. OTHER EVENTS. As previously disclosed, in January 2001, Health Net, Inc. ("Health Net") entered into a definitive agreement to sell its Florida health plan to Florida Health Plan Holdings II, LLC for $48 million, consisting of $23 million in cash and a $25 million secured five-year note bearing 8 percent interest, subject to purchase price adjustments. The transaction is expected to close in the second quarter of 2001, subject to regulatory approval and other customary conditions to closing. Health Net also agreed to sell the corporate facility building used by the Florida health plan under defined terms which require Health Net to finance the sale over five years. Attached hereto as Exhibit 99.1, and incorporated herein by reference, are unaudited pro forma consolidated financial statements for Health Net which present the estimated effects of the sale of the Florida health plan and the corporate facility building used by the Florida health plan. Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) EXHIBITS
ITEM NO. EXHIBIT INDEX -------- ------------- 99.1 Unaudited pro forma consolidated financial statements of the registrant.
2 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. HEALTH NET, INC. Date: March 30, 2001 By: /s/ B. CURTIS WESTEN --------------------------- B. Curtis Westen, Esq. Senior Vice President, General Counsel and Secretary 3 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION -------------- ----------- 99.1 Unaudited pro forma consolidated financial statements of the registrant.
4 EX-99.1 2 a2043742zex-99_1.txt EXHIBIT 99.1 EXHIBIT 99.1 UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS The following unaudited pro forma consolidated financial statements for Health Net, Inc. ("Health Net") present the estimated effects of the sale of Foundation Health, a Florida Health Plan, Inc. ("Florida Health Plan"), a wholly owned subsidiary of Health Net. The historical audited consolidated financial statements as of, and for the year ended, December 31, 2000 set forth below have been derived from, and should be read in conjunction with, the historical consolidated financial statements of Health Net and related notes included in Health Net's Annual Report on Form 10-K for the year ended December 31, 2000. The unaudited pro forma consolidated balance sheet assumes that the sale of Florida Health Plan and its related corporate facility building occurred on December 31, 2000. The unaudited pro forma consolidated statement of operations assumes that the sale of Florida Health Plan and its related corporate facility building occurred on January 1, 2000. In January 2001, Health Net entered into a definitive agreement to sell Florida Health Plan to Florida Health Plan Holdings II, LLC for $48 million, consisting of $23 million in cash and a $25 million secured five-year note bearing 8 percent interest, subject to purchase price adjustments. The transaction is expected to close in the second quarter of 2001, subject to regulatory approval and other customary conditions to closing. Health Net also agreed to sell the corporate facility building used by Florida Health Plan under defined terms which require Health Net to finance the sale over five years. The unaudited pro forma consolidated financial statements are provided for informational purposes only. They do not purport to be indicative of the consolidated financial position or results of operations for Health Net that actually would have occurred if the sale of Florida Health Plan had been consummated on the dates indicated or that may be obtained in the future. 1 HEALTH NET, INC. UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2000 (AMOUNTS IN THOUSANDS)
CONSOLIDATED PRO FORMA PRO FORMA HISTORICAL ADJUSTMENTS CONSOLIDATED ---------- ----------- ------------ ASSETS Current Assets: Cash and cash equivalents $ 1,046,735 $ (91,879)(1) $ 972,647 2,901 (2) 15,000 (3) (110)(4) Investments - available for sale 486,902 (21,768)(1) 465,134 Premiums receivable, net of allowance for doubtful accounts 174,654 (1,876)(1) 172,778 Amounts receivable under government contracts 334,187 - 334,187 Deferred taxes 141,752 - 141,752 Intercompany receivables (8,326)(1) - 8,326 (2) Reinsurance and other receivables 141,140 - 141,140 Other assets 74,184 (2,252)(1) 71,932 ------------ --------- ----------- Total current assets 2,399,554 (99,984) 2,299,570 Property and equipment, net 296,009 (5,402)(1) 271,046 (19,561)(4) Goodwill and other intangible assets, net 863,419 (27,290)(1) 836,129 Other noncurrent assets 111,134 (2,743)(1) 149,791 25,000 (3) 1,400 (4) 15,000 (4) ------------ --------- ----------- Total Assets $ 3,670,116 $ (113,580) $ 3,556,536 ------------ --------- ----------- LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Reserves for claims and other settlements 1,242,389 (73,239)(1) 1,169,150 Unearned premiums 238,571 (36,071)(1) 202,500 Notes payable and capital leases 49 - 49 Amounts payable under government contracts 972 - 972 Intercompany payables (11,227)(1) - 11,227 (2) Accounts payable and other liabilities 329,100 (2,489)(1) 326,611 ------------ --------- ----------- Total current liabilities 1,811,081 (111,799) 1,699,282 Notes payable and capital leases 766,450 - 766,450 Deferred taxes 8,635 - 8,635 Other noncurrent liabilities 22,819 (11)(1) 22,808 ------------ --------- ----------- Total Liabilities 2,608,985 (111,810) 2,497,175 ------------ --------- ----------- STOCKHOLDERS' EQUITY: Common Stock and additional paid-in capital 649,292 - 649,292 Treasury Class A common stock, at cost (95,831) - (95,831) Retained earnings 511,224 1,501 (1)(3) 509,454 (3,271)(4) Accumulated other comprehensive loss (3,554) (3,554) ------------ --------- ----------- Total Stockholders' Equity 1,061,131 (1,770)(5) 1,059,361 ------------ --------- ----------- Total Liabilities and Stockholders' Equity $ 3,670,116 $(113,580) $ 3,556,536 =========== ========= ===========
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements 2 HEALTH NET, INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2000 (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
CONSOLIDATED PRO FORMA PRO FORMA HISTORICAL ADJUSTMENTS CONSOLIDATED ------------ ----------- ------------ REVENUES Health plan services premiums $ 7,351,098 $ (505,301)(1) $ 6,845,797 Government contracts/Specialty services 1,623,158 - 1,623,158 Investment and other income 102,299 (4,600)(1) 100,892 2,000 (3) 1,193 (4) ------------ ---------- ------------ Total revenues 9,076,555 (506,708) 8,569,847 ------------ ---------- ------------ EXPENSES Health plan services 6,242,282 (477,484)(1) 5,764,798 Government contracts/Specialty services 1,080,407 - 1,080,407 Selling, general and administrative 1,296,881 (72,091)(1) 1,224,790 Depreciation 67,260 (3,529)(1) 63,731 Amortization 38,639 (806)(1) 37,833 Interest 87,930 (300)(1) 87,630 Net loss on sale of businesses and properties 409 - 409 ------------ ---------- ------------ Total expenses 8,813,808 (554,210) 8,259,598 ------------ ---------- ------------ Income from operations before income taxes 262,747 47,502 310,249 Income tax provision (benefit) 99,124 (20,895)(1) 121,137 700 (3) 418 (4) ------------ ---------- ------------ Net income $ 163,623 $ 25,489 $ 189,112 ============ ========== ============= Earnings per share: Basic earnings per share $ 1.34 $ 0.20 $ 1.54 Diluted earnings per share $ 1.33 $ 0.20 $ 1.53 Weighted average shares outstanding: Basic 122,471 122,471 122,471 Diluted 123,453 123,453 123,453
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements 3 NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS The unaudited pro forma consolidated financial statements have been prepared in accordance with Article 11 of Regulation S-X. The unaudited pro forma consolidated financial statements do not include certain nonrecurring costs directly associated with the disposition of Florida Health Plan, which will be recorded upon closing. These costs are discussed in note (5) below. Pro forma adjustments for the unaudited pro forma consolidated financial statements as of, and for the year ended, December 31, 2000 are as follows: (1) These adjustments give effect to the sale and elimination of Florida Health Plan balance sheet and operating results. The pro forma statement of operations adjustments do not take into consideration any reinvestment of the net cash proceeds ($15 million, after estimated costs of $8 million) from the sale of Florida Health Plan. (2) This adjustment gives effect to the settlement of intercompany balances with Florida Health Plan. (3) The balance sheet adjustment gives effect to the receipt of the estimated net sales proceeds of $40 million from the sale of Florida Health Plan, which is net of estimated costs of $8 million. The statement of operations adjustment includes interest income of $2 million and related tax impact of $0.7 million from the $25 million note. (4) The balance sheet adjustment gives effect to the estimated sales proceeds of a $15 million note from the sale of the corporate facility used by Florida Health Plan and includes estimated transaction expenses of $0.110 million and a tax benefit of $1.4 million. The statement of operations adjustment gives effect to interest income of $1.193 million and related tax impact of $0.418 million from the $15 million note. (5) The unaudited pro forma consolidated financial statements do not include all the nonrecurring costs associated with the disposition of Florida Health Plan. The unaudited pro forma consolidated financial statements also do not include all the additional nonrecurring costs with respect to the termination of employees and lease obligations and other transition activities, which will also be recorded upon closing of the sale of Florida Health Plan. 4 -----END PRIVACY-ENHANCED MESSAGE-----