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
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Date of report (Date of earliest event reported): September 18, 1997
RISCORP, INC.
(Exact Name of Registrant as Specified in Charter)
Florida 0-27462 65-0335150
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
1390 Main Street
Sarasota, Florida 34236
(Address of Principal Executive Offices, including Zip Code)
Registrant's telephone number, including area code: (941) 951-2022
(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
On September 18, 1997, the U.S. Attorney's Office in Pensacola, Florida
announced that a United States grand jury had indicted RISCORP, Inc. (the
"Company") and five former officers, including William D. Griffin, founder and
Chairman of the Board, for various charges stemming from alleged illegal
political campaign contributions. On September 18, 1997, the Board of Directors
approved a guilty plea by RISCORP Management Services, Inc., a wholly owned,
non-regulated subsidiary of the Company, to a single count of conspiracy to
commit mail fraud. As a result of the plea being negotiated with the U.S.
Attorney, it is expected that the indictment against the Company will be
dismissed. Mr. Griffin has resigned from the Board of Directors of the Company
and all other positions with the Company and its subsidiaries.
A copy of the press release issued by the Company with respect to the
foregoing matters is filed herewith as Exhibit 99 and is incorporated herein by
reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
The following exhibit is filed as a part of this report:
EXHIBIT NO. DESCRIPTION
99 Press Release, dated September 18, 1997
SIGNATURE
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.
RISCORP, INC.
By: /s/ Frederick M. Dawson
Frederick M. Dawson
Chief Executive Officer
Dated: October 1, 1997
EXHIBIT 99
Form of Press Release
STATEMENT OF RISCORP, INC.
REGARDING GRAND JURY INDICTMENTS
SARASOTA, FL, September 18, 1997 - RISCORP, Inc., today issued the
following statement by Frederick M. Dawson, its chief executive officer,
regarding the indictments announced today by P. Michael Patterson, the U.S.
Attorney in Tallahassee.
"When I joined RISCORP in May, one of my highest priorities as established
by the Board of Directors was to resolve, once and for all, any remaining
issues regarding the grand jury investigation of RISCORP. Now, I am pleased
to announce that, after numerous conversations between representatives of
the Company and the U.S. Attorney, the Board of Directors has unanimously
approved a guilty plea by a non-regulated subsidiary of the Company to one
conspiracy count. As a result of the plea being negotiated with the U.S.
Attorney, it is expected that the indictment against RISCORP will be
dismissed. RISCORP, as well as its agents, policyholders, employees and
shareholders can now move forward.
"Importantly, none of RISCORP's regulated insurance company subsidiaries
are implicated by the plea agreed to by RISCORP Management Services, a
non-regulated subsidiary. In addition, the actions underlying the
indictment and plea by the Company's subsidiary did not involve the
Company's insurance business.
"The Company expects to be fined as a result of its subsidiary's guilty
plea. While the amount of any fine will be determined by the court, the
Company does not believe that it will exceed approximately $300,000.
Obviously, a fine in this amount will not have a material adverse effect on
the ability of the Company or its regulated insurance companies to continue
conducting business.
"In addition, as announced by the U. S. Attorney, four former officers of
the Company and William D. Griffin were also indicted. Prior to
announcement of the indictment, Mr. Griffin indicated he would be resigning
all positions with the Company and its subsidiaries in order to allow the
Company to continue its recent progress. These individuals are each
entitled to their day in court. I personally pledge that the Company and
its current employees are dedicated to the highest ethical and moral
principles, as defined by the Company's Code of Business Conduct. Our
employees know that any impropriety will be dealt with swiftly and
decisively.
"Over the past 120 days, our management team has methodically addressed the
issues plaguing the Company. We have conducted a thorough reorganization of
the Company, its operations and its management. We have refocused the
Company's operations around its core strengths in workers' compensation
insurance. We have decreased operating expenses by nearly 30 percent. We
have improved relationships with our regulators. We have strengthened the
Company's financial reporting capabilities, filed audited statutory
statements for our insurance company subsidiaries, and continue to make
progress on our GAAP financial filings. And we continue to move forward
with the close of our asset sale agreement with Zenith Insurance Company.
"Today, RISCORP faces a brighter, more positive future. Our present
management team is focused completely on our ultimate responsibilities to
our regulatory agencies, employees, agents, policyholders and shareholders,
and remains committed to delivering superior quality product and service."
RISCORP, Inc. is a managed care workers' compensation company offering
employers integrated products and services designed to control costs, provide
quality medical care, and promote rapid return to work.
