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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): August 15, 2000
MD2PATIENT, INC.
(Exact name of registrant
as specified in its charter)
Tennessee 333-91619 62-1798114
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
501 Corporate Centre Drive, Suite 200
Franklin, Tennessee 37067
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (615) 383-8400
N/A
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On Tuesday, August 15, 2000, an article regarding the Company was
printed in The Tennessean newspaper that contained several errors regarding the
Company and the status of its negotiations with respect to various strategic
alternatives it is considering. This current report is being filed to correct
such errors.
As previously disclosed, due to an acceleration of the Company's
business plan through, among other things, the expansion of its technical and
sales infrastructure, the Company has experienced an increase in the general and
administrative expenses associated with operating its business. Given the
Company's limited capital resources, it has been actively pursuing various
sources of new cash financing, including the possibility of creating a new
series of preferred stock to be issued to institutional investors in connection
with a convertible debt or equity investment in the Company. Additionally, the
Company is exploring other strategic alternatives that may include a joint
venture, strategic alliance or, possibly, the sale of the Company. To date, the
discussions regarding the possible sale of the Company have been preliminary in
nature and subject to, among other things, a mutually acceptable valuation of
the Company and, in at least one instance, an acceptable valuation of the
potential acquiror. Accordingly, the newspaper report indicating that the
Company could "soon be merged into a new company" is inaccurate. The speculative
nature of any transaction with the party described in the newspaper article is
compounded by the fact that the potential acquiror must successfully complete
the consolidation of six other companies in connection with, or immediately
prior to, any proposed transaction with the Company. While the Company will
continue to explore any number of possible strategic alternatives, only
preliminary discussions have occurred to date.
Similarly, contrary to the contents of the article, while the Company
is also discussing a strategic alliance to provide services as the Internet
portal for the group of companies being consolidated, to date the Company has
neither entered into any such strategic alliance nor executed a letter of intent
to do so.
MANAGEMENT AND OPERATIONAL CHANGES
In an effort to reduce current operating expenses, the Company will
reduce its work force from 58 to approximately 35 employees. As part of this
reduction, Mr. Joseph B. Crace, Chief Executive Officer and President of the
Company, has voluntarily agreed to resign as an officer of the Company to pursue
other opportunities, but will continue to assist the Company as a member of its
board of directors. Mr. Nicholas A. Balog, Executive Vice President of
Operations, has also elected to resign to pursue other opportunities. The
specific terms of their departure are still being discussed. Mr. John E. Blount,
a founder and the Executive Vice President of Physician Services, will succeed
Mr. Crace as Chief Executive Officer and will focus on the Company's
relationship with its physician subscribers to its Internet services. Mr. James
G. Petway, Jr., Executive Vice President and Chief Financial Officer, has been
appointed to serve as President of the Company and will assume day-to-day
operating responsibility. Mr. Petway will also retain the title of Chief
Financial Officer.
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In an effort to further reduce operating expenses, each of the four
senior executive officers of the Company and certain other employees have agreed
to a salary deferral pending the receipt by the Company of additional financing.
With these changes, the Company believes it has reduced its monthly operating
expenses to approximately $450,000.
Some of the information provided above constitutes forward-looking
statements which are subject to the safe-harbor provisions of the federal
securities laws. In particular, our estimate of future monthly operating
expenses, as well as our discussion of possible strategic alternatives,
constitute such forward-looking statements. These forward-looking statements are
based on our current expectations and are subject to material risks and
uncertainties. Actual results could differ materially from these forward-looking
statements depending on changes in external competitive market factors, capital
market conditions, the effectiveness of our marketing and promotion strategies
or our ability to execute our business strategy. These matters and other
business risks to which the Company is subject are discussed in our periodic
reports and in our registration statement on Form S-1 filed with the Securities
and Exchange Commission. In particular, investors are urged to review carefully
the information under the caption "Risk Factors" contained in the registration
statement. The documents may be obtained by accessing the database maintained by
the Securities and Exchange Commission at www.sec.gov or by contacting the
Company at the address or telephone number on the cover of this Report. We
undertake no responsibility to update any of these forward-looking statements.
SIGNATURES
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.
MD2PATIENT, INC.
By: /s/ James G. Petway, Jr.
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James G. Petway, Jr.
President
Dated: August 23, 2000
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