UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 12B-25
NOTIFICATION OF LATE FILING
(Check one)
[X] Form 10-K [ ] Form 20-F [ ] Form 11-K [ ] Form 10-Q [ ] Form N-SAR
For Period Ended: DECEMBER 31, 1998
[ ] Transition Report on Form 10-K
[ ] Transition Report on Form 20-F
[ ] Transition Report on form 11-K
[ ] Transition Report on Form 10-Q
[ ] Transition report on form N-SAR
For the Transition Period Ended: ______________
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READ ATTACHED INSTRUCTION SHEET BEFORE PREPARING FORM. PLEASE PRINT OR TYPE.
NOTHING IN THIS FORM SHALL BE CONSTRUED TO IMPLY THAT THE
COMMISSION HAS VERIFIED ANY INFORMATION CONTAINED HEREIN.
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If the notification relates to a portion of the filing checked above,
identify the item(s) to which the notification relates:
PART 1 - REGISTRANT INFORMATION (Official Text)
Full Name of Registrant:
APPLE ORTHODONTIX, INC.
Former Name if Applicable:
N/A
Address of Principal Executive Office (Street and Number):
2777 ALLEN PARKWAY, SUITE 700
City, State and Zip code
HOUSTON, TX 77019
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PART II - RULES 12b-25 (b) and (c)
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If the subject report could not be filed without unreasonable effort or expense
and the Registrant seeks relief pursuant to Rule 12b-25(b) the following should
be completed. (check box if appropriate)
[X] (a) the response described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or expense;
[X] (b) The subject annual report, semi-annual report, transition report on
form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof will be filed on or
before the fifteenth calendar day following the prescribed due date; or the
subject quarterly report or transition report on form 10-Q, or portion thereof
will be filed on or before the fifth calendar day following the prescribed due
date; and
[X] (c) The accountant's statement or other exhibit required by Rule 12b-25(c)
has been attached, if applicable.
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PART III - NARRATIVE (Official Text)
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State below in reasonable detail the reasons why the form 10-K, 11-K, 10-Q,
N-SAR, or the transition report or portion thereof, could not be filed within
the prescribed time period. (Attach Extra Sheets if Needed)
The Registrant has been in discussions with its auditors during the year-end
audit with respect to certain impairment issues related to the valuation of its
assets. As a result of the estimated special charge discussed in Part IV, the
Registrant is no longer in compliance with certain of the covenants of its $25
million unsecured bank credit facility with Chase Bank of Texas, N.A. (the
"Chase Facility"). The Registrant is currently renegotiating certain of the
covenants of the Chase Facility, which the Company anticipates will be completed
successfully prior to April 15, 1999. The resolution of these issues has delayed
the completion of the Annual Report on Form 10-K for the year ended December 31,
1998.
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[ARTHUR ANDERSEN LETTERHEAD]
April 1, 1999
Mr. James Bobbitt
Chief Financial Officer
Apple Orthodontix, Inc.
2777 Allen Parkway, Suite 700
Dear Mr. Bobbitt:
You have furnished us with a copy of your "Notification of Late Filing" on Form
12b-25 dated April 1, 1999.
We are in agreement with the comments under Part III of the Form with respect to
the reasons why we are unable to furnish our report on the financial statements
of Apple Orthodontix, Inc. on or before the date of the Form 10-K of Apple
Orthodontix, Inc. for the year ended December 31, 1998 is required to be filed.
Very truly yours,
/s/ ARTHUR ANDERSEN
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PART IV - OTHER INFORMATION (Official Text)
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(1) Name and telephone number of person to contact in regard to this
notification
[NAME] [AREA CODE] [NUMBER]
JAMES E. BOBBITT (713) 852-2505
(2) Have all other periodic reports required under Section 13 or 15(d) of the
Securities Exchange Act of 1934 or Section 30 of the Investment Company
Act of 1940 during the preceding 12 months or for such shorter period that
the Registrant was required to file such report(s) been filed? If answer
is no, identify reports(s).
[X] Yes [ ] No
(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be reflected
by the earnings statement to be included in the subject report or portion
thereof?
[X] Yes [ ] No
The Registrant anticipates recording a special charge in the fourth quarter of
approximately $19 million on a pre-tax basis. The special charge, which is
primarily noncash in nature, reflects valuation reserves related to the
Registrant's service fee intangibles, property and equipment, receivables from
certain of its affiliated practices and certain other assets. In addition,
without giving effect to the special charge discussed above, the Registrant also
anticipates its fourth quarter 1998 earnings to be lower than the corresponding
period of 1997 and to probably result in a loss.
________________________________________________________________________________
APPLE ORTHODONTIX, INC.
(Name of Registrant as Specified in Charter)
has caused this notification to be signed on its behalf by the undersigned
hereunto duly authorized.
By /s/ JAMES BOBBITT Date: APRIL 1, 1999
