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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ---------------- to -----------------
Commission File No. 1-6639
CHARTER MEDICAL CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 58-1076937
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3414 Peachtree Rd., NE, Suite 1400
Atlanta, Georgia 30326
(Address of principal executive offices)
(Zip Code)
(404) 841-9200
(Registrant's telephone number, including area code)
See Table of Additional Registrants below.
___________
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
___________
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes X No
--- ---
The number of shares of the Registrant's Common Stock outstanding as of July 31,
1995, was 28,398,166.
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<PAGE>
<TABLE>
<S> <C> <C> <C>
Ambulatory Resources, Inc. Georgia 58-1456102 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Atlanta MOB, Inc. Georgia 58-1558215 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Beltway Community Hospital, Texas 58-1324281 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
C.A.C.O. Services, Inc. Ohio 58-1751511 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
CCM, Inc. Nevada 58-1662418 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
CMCI, Inc. Nevada 88-0224620 1061 East Flamingo Road
Suite One
Las Vegas, NV 89119
(702) 737-0282
CMFC, Inc. Nevada 88-0215629 1061 East Flamingo Road
Suite One
Las Vegas, NV 89119
(702) 737-0282
CMSF, Inc. Florida 58-1324269 3550 Colonial Boulevard
Fort Myers, FL 33912
(813) 939-0403
CPS Associates, Inc. Virginia 58-1761039 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Alvarado Behavioral California 58-1394959 7050 Parkway Drive
Health System, Inc. La Mesa, CA 91942-2352
(619) 465-4411
Charter Appalachian Hall North Carolina 58-20978 2760 Caledonia Road
Behavioral Health System, Inc. Asheville, NC 28803
<PAGE>
Charter Arbor Indy Indiana 35-1916340 3414 Peachtree Rd., N.E.
Behavioral Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Augusta Behavioral Georgia 58-1615676 3100 Perimeter Parkway
Health System, Inc. P.O. Box 14939
Augusta, GA 30909
(404) 868-6625
Charter Bay Harbor Behavioral Florida 58-1640244 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, Georgia 30326
(404) 841-9200
Charter Beacon Behavioral Indiana 58-1524996 1720 Beacon Street
Health System, Inc. Fort Wayne, IN 46805
(219) 423-3651
Charter Behavioral Health System New Jersey 58-20978 3219 Prospect Street
at Fair Oaks, Inc. Summit, NJ 07901
(908) 277-9102
Charter Behavioral Health System Maryland 52-186621 2522 Thomas Run Road
at Hidden Brook, Inc. Bel Air, MD 21014
(410) 879-1919
Charter Behavioral Health System California 33-0606642 3414 Peachtree Rd., N.E.
at Los Altos, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Florida 65-0519663 1324 37th Avenue, East
at Manatee Adolescent Treatment Bradenton, FL 34208
Services, Inc. (813) 746-1388
Charter Behavioral Health System Maryland 52-18662211 4901 Broschart Road
at Potomac Ridge, Inc. Rockville, MD 20850
(301) 251-4500
Charter Behavioral Health System Maryland 52-1866214 3680 Warwick Road, Route 1
of Delmarva, Inc. East New Market, MD 21631
(410) 943-8108
Charter Behavioral Health System Georgia 58-151330 4240 Mitchell Bridge Road
of Athens, Inc. Athens, GA 30606
(404) 546-7277
<PAGE>
Charter Behavioral Health System Texas 58-1440665 8402 Cross Park Drive
of Austin, Inc. Austin, TX 78754
(512) 837-1800
Charter Behavioral Health System Texas 76-043057 1709 Medical Center Boulevard
of Baywood, Inc. Webster, TX 77598
(713) 332-9550
Charter Behavioral Health System Florida 58-1527678 4480 51st Street, West
of Bradenton, Inc. Bradenton, FL 34210
(813) 746-1388
Charter Behavioral Health System California 95-4470774 3414 Peachtree Rd., N.E.
of Canoga Park, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Georgia 58-1408670 3500 Riverside Drive
of Central Georgia, Inc. Macon, GA 31210
(912) 474-6200
Charter Behavioral Health System South Carolina 58-1761157 2777 Speissegger Drive
of Charleston, Inc. Charleston, SC 29405-8299
(803) 747-5830
Charter Behavioral Health System Virginia 58-1616917 2101 Arlington Boulevard
of Charlottesville, Inc. Charlottesville, VA 22903-1593
(804) 977-1120
Charter Behavioral Health System Illinois 58-1315760 4700 North Clarendon Avenue
of Chicago, Inc. Chicago, IL 60640
(312) 728-7100
Charter Behavioral Health System California 58-1473063 3414 Peachtree Rd., N.E.
of Chula Vista, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Missouri 61-1009977 200 Portland Street
of Columbia, Inc. Columbia, MO 65201
(314) 876-8000
Charter Behavioral Health System Texas 58-1513305 3126 Rodd Field Road
of Corpus Christi, Inc. Corpus Christi, TX 78414
(512) 993-8893
Charter Behavioral Health System Texas 58-1513306 6800 Preston Road
of Dallas, Inc. Plano, TX 75024
(214) 964-3939
<PAGE>
Charter Behavioral Health System Indiana 35-1916338 7200 East Indiana
of Evansville, Inc. Evansville, IN 47715
(812) 476-7200
Charter Behavioral Health System Texas 58-1643151 6201 Overton Ridge Blvd.
of Fort Worth, Inc. Fort Worth, TX 76132
(817) 292-6844
Charter Behavioral Health System Mississippi 58-1616919 3531 Lakeland Drive
of Jackson, Inc. Jackson, MS 39208
(601) 939-9030
Charter Behavioral Health System Florida 58-1483015 3947 Salisbury Road
of Jacksonville, Inc. Jacksonville, FL 32216
(904) 296-2447
Charter Behavioral Health System Indiana 35-1916342 3414 Peachtree Rd., N.E.
of Jefferson, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Kansas 58-1603154 8000 West 127th Street
of Kansas City, Inc. Overland Park, KS 66213
(913) 897-4999
Charter Behavioral Health System Louisiana 72-068649 2310 Youngsville Highway
of Lafayettte, Inc. Lafayette, LA 70508
(317) 448-6999
Charter Behavioral Health System Louisiana 62-1152811 4250 Fifth Avenue, South
of Lake Charles, Inc. Lake Charles, LA 70605
(318) 474-6133
Charter Behavioral Health System California 33-0606647 3414 Peachtree Rd., N.E.
of Lakewood, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Indiana 35-1916343 3714 S. Franklin Street
of Michigan City, Inc. Michigan City, IN 46360
(219) 872-0531
Charter Behavioral Health System Alabama 58-1569921 5800 Southland Drive
of Mobile, Inc. Mobile, AL 36693
(205) 661-3001
Charter Behavioral Health System New Hampshire 02-0470752 29 Northwest Boulevard
of Nashua, Inc. Nashua, NH 03063
(603) 886-5000
<PAGE>
Charter Behavioral Health System Nevada 58-1321317 7000 West Spring Mountain Rd.
of Nevada, Inc. Las Vegas, NV 89117
(702) 876-4357
Charter Behavioral Health System New Mexico 58-1479480 5901 Zuni Road, SE
of New Mexico, Inc. Albuquerque, NM 87108
(505) 265-8800
Charter Behavioral Health System California 58-1857277 101 Cirby Hills Drive
of Northern California, Inc. Roseville, CA 95678
(916) 969-4666
Charter Behavioral Health System Arkansas 58-1449455 4253 Crossover Road
of Northwest Arkansas, Inc. Fayetteville, AR 72703
(501) 521-5731
Charter Behavioral Health System Indiana 58-1603160 101 West 61st Avenue
of Northwest Indiana, Inc. State Road 51
Hobart, IN 46342
(219) 947-4464
Charter Behavioral Health System Kentucky 61-1006115 435 Berger Road
of Paducah, Inc. Paducah, KY 42002-7609
(502) 444-0444
Charter Behavioral Health System Illinois 36-3946945 3414 Peachtree Rd., N.E.
of Rockford, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System California 58-1747020 455 Silicon Valley Boulevard
of San Jose, Inc. San Jose, CA 95138
(408) 224-2020
Charter Behavioral Health System Georgia 58-1750583 1150 Cornell Avenue
of Savannah, Inc. Savannah, GA 31406
(912) 354-3911
Charter Behavioral Health System California 58-1366605 3414 Peachtree Rd., N.E.
of Southern California, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health System Florida 58-1616916 4004 North Riverside Drive
of Tampa Bay, Inc. Tampa, FL 33603
(813) 238-8671
Charter Behavioral Health System Arkansas 71-0752815 801 Arkansas Boulevard
of Texarkana, Inc. Texarkana, AR 75502
(501) 773-3131
<PAGE>
Charter Behavioral Health System California 95-2685883 2055 Kellogg Drive
of the Inland Empire, Inc. Corona, CA 91719
(714) 735-2910
Charter Behavioral Health System Ohio 58-1731068 1725 Timberline Road
of Toledo, Inc. Maumee, Ohio 43537
(419) 891-9333
Charter Behavioral Health System Arizona 86-0757462 7220 E. Rosewood Street
of Tucson, Inc. Tucson, AZ 85710
(602) 296-2828
Charter Behavioral Health System California 33-0606644 1100 S. Akers
of Visalia, Inc. Visalia, CA 93277
Charter Behavioral Health System Minnesota 41-1775626 109 North Shore Drive
of Waverly, Inc. Waverly, MN 55390
(612) 658-4811
Charter Behavioral Health System North Carolina 56-1050502 3637 Old Vineyard Road
of Winston-Salem, Inc. Winston-Salem, NC 27104
(919) 768-7710
Charter Behavioral Health System California 33-0606646 3414 Peachtree Rd., N.E.
of Yorba Linda, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Behavioral Health Georgia 58-1900736 3414 Peachtree Rd., N.E.
Systems of Atlanta, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Brawner Behavioral Georgia 58-0979827 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter By-The-Sea Georgia 58-1351301 2927 Demere Road
Behavioral Health System, Inc. St. Simons Island, GA 31522
(912) 638-1999
Charter Canyon Behavioral Health Utah 58-1557925 175 West 7200 South
System, Inc. Midvale, UT 84047
(801) 561-8181
Charter Canyon Springs California 33-0606640 69696 Ramon Road
Behavioral Health System, Inc. Cathedral City, CA 92234
(619) 321-2000
<PAGE>
Charter Centennial Peaks Colorado 58-1761037 2255 South 88th Street
Behavioral Health System, Inc. Louisville, CO 80027
(303) 673-9990
Charter Community Hospital, California 58-1398708 21530 South Pioneer Boulevard
Inc. Hawaiian Gardens, CA 90716
(310) 860-0401
Charter Community Hospital Iowa 58-1523702 3414 Peachtree Rd., N.E.
of Des Moines, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Contract Services, Inc. Georgia 58-2100699 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Cove Forge Behavioral Pennsylvania 25-1730464 New Beginnings Road
Health System, Inc. Williamsburg, PA 16693
(814) 832-2121
Charter Crescent Pines Behavioral Georgia 58-1249663 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Fairbridge Maryland 52-1866218 14907 Broschart Road
Behavioral Health System, Inc. Rockville, MD 20850
(301) 251-4565
Charter Fairmount Behavioral Pennsylvania 58-1616921 561 Fairthorne Avenue
Health System, Inc. Philadelphia, PA 19128
(215) 487-4000
Charter Fenwick Hall South Carolina 57-0995766 3414 Peachtree Rd., N.E.
Behavioral Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Financial Offices, Inc. Georgia 58-1527680 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Forest Behavioral Louisiana 58-1508454 9320 Linwood Avenue
Health System, Inc. Shreveport, LA 71106
(318) 688-3930
<PAGE>
Charter Grapevine Behavioral Texas 58-1818492 2300 William D. Tate Ave.
Health System, Inc. Grapevine, TX 76051
(817) 481-1900
Charter Greensboro Behavioral North Carolina 58-1335184 700 Walter Reed Drive
Health System, Inc. Greensboro, NC 27403
(919) 852-4821
Charter Health Management Texas 58-2025056 3414 Peachtree Rd., N.E.
of Texas, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of Ohio 58-1598899 3414 Peachtree Rd., N.E.
Columbus, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of Denver, Colorado 58-1662413 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of Ft. Collins, Colorado 58-1768534 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of Laredo, Inc. Texas 58-1491620 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of Miami, Inc. Florida 61-1061599 11100 N.W. 27th Street
Miami, FL 33172
(305) 591-3230
Charter Hospital of Mobile, Inc. Alabama 58-1318870 251 Cox Street
Mobile, AL 36604
(205) 432-4111
Charter Hospital of Santa New Mexico 58-1584861 3414 Peachtree Rd., N.E.
Teresa, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Hospital of St. Louis, Inc. Missouri 58-1583760 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
<PAGE>
Charter Hospital of Torrance, Inc. California 58-1402481 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Indianapolis Behavioral Indiana 58-1674291 5602 Caito Drive
Health System, Inc. Indianapolis, IN 46226
(317) 545-2111
Charter Lafayette Behavioral Indiana 58-1603158 3700 Rome Drive
Health System, Inc. Lafayette, IN 47905
(317) 448-6999
Charter Lakehurst New Jersey 22-3286879 440 Beckerville Road
Behavioral Health System, Inc. Lakehurst, NJ 08733
(908) 657-4800
Charter Lakeside Behavioral Tennessee 62-0892645 2911 Brunswick Road
Health System, Inc. Memphis, TN 38134
(901) 377-4700
Charter Laurel Heights Georgia 58-1558212 3414 Peachtree Rd., N.E.
Behavioral Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Laurel Oaks Behavioral Florida 58-1483014 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Linden Oaks Illinois 36-3943776 852 West Street
Behavioral Health System, Inc. Naperville, IL 60540
(708) 305-5500
Charter Little Rock Behavioral Arkansas 58-1747019 1601 Murphy Drive
Health System, Inc. Maumelle, AR 72113
(501) 851-8700
Charter Louisville Behavioral Kentucky 58-1517503 1405 Browns Lane
Health System, Inc. Louisville, KY 40207
(502) 896-0495
Charter MOB of Virginia 58-1761158 1023 Millmont Avenue
Charlottesville, Inc. Charlottesville, VA 22901
(804) 977-1120
Charter Meadows Maryland 52-1866216 730 Maryland, Route 3
Behavioral Health System, Inc. Gambrills, MD 21054
(410) 923-6022
<PAGE>
Charter Medfield Behavioral Florida 58-1705131 1950 Benoist Farms Rd.
Health System, Inc. West Palm Beach, FL 33411
(404) 841-9200
Charter Medical - California, Inc. Georgia 58-1357345 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical - Clayton Georgia 58-1579404 3414 Peachtree Rd., N.E.
County, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical - Cleveland, Inc. Texas 58-1448733 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical - Dallas, Inc. Texas 58-1379846 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical - Long California 58-1366604 6060 Paramount Boulevard
Beach, Inc. Long Beach, CA 90805
(310) 220-1000
Charter Medical - New York, Inc. New York 58-1761153 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical (Cayman Cayman Islands, BWI 58-1841857 Caledonian Bank & Trust
Islands) Ltd. Swiss Bank Building
Caledonian House
Georgetown-Grand Cayman
Cayman Islands
(809) 949-0050
Charter Medical Executive Georgia 58-1538092 3414 Peachtree Rd., N.E.
Corporation Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical Information Georgia 58-1530236 3414 Peachtree Rd., N.E.
Services, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
<PAGE>
Charter Medical International, Cayman Islands, BWI N/A Caledonian Bank & Trust
Inc. Swiss Bank Building
Caledonian House
Georgetown-Grand Cayman
Cayman Islands
(809) 949-0050
Charter Medical International, Nevada 58-1605110 3414 Peachtree Rd., N.E.
S.A., Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical Management Georgia 58-1195352 3414 Peachtree Rd., N.E.
Company Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical of East Arizona 58-1643158 2190 N. Grace Boulevard
Valley, Inc. Chandler, AZ 85224-2195
(602) 899-8989
Charter Medical of England, Ltd. United Kingdom N/A 111 Kings Road
Box 323
London SW3 4PB
London, England
44-71-351-1272
Charter Medical of Florida, Inc. Florida 58-2100703 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical of North Arizona 58-1643154 6015 W. Peoria Avenue
Phoenix, Inc. P.O. Box 3469
Glendale, AZ 85302
(602) 878-7878
Charter Medical of Orange Florida 58-1615673 3414 Peachtree Rd., N.E.
County, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Medical of Puerto Commonwealth of 58-1208667 Caso Building, Suite 1504
Rico, Inc. Puerto Rico 1225 Ponce De Leon Avenue
Santurce, P.R. 00907
(809) 723-8666
Charter Mental Health Florida 58-2100704 3414 Peachtree Rd., N.E.
Options, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
<PAGE>
Charter Mid-South Behavioral Tennessee 58-1860496 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Milwaukee Behavioral Wisconsin 58-1790135 11101 West Lincoln Avenue
Health System, Inc. West Allis, WI 53227
(414) 327-3000
Charter Mission Viejo Behavioral California 58-1761156 23228 Madero
Health System, Inc. Mission Viejo, CA 92691
(714) 830-4800
Charter North Behavioral Alaska 58-1474550 2530 DeBarr Road
Health System, Inc. Anchorage, AK 99508-2996
(907) 258-7575
Charter Northbrooke Wisconsin 39-1784461 3414 Peachtree Rd., N.E.
Behavioral Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter North Counseling Alaska 58-2067832 2530 DeBarr Road
Center, Inc. Anchorage, AL 99508-2996
(907) 258-7575
Charter Northridge Behavioral North Carolina 58-1463919 400 Newton Road
Health System, Inc. Raleigh, NC 27615
(919) 847-0008
Charter Northside Hospital, Inc. Georgia 58-1440656 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Oak Behavioral California 58-1334120 1161 East Covina Boulevard
Health System, Inc. Covina, CA 91724
(818) 966-1632
Charter of Alabama, Inc. Alabama 63-0649546 3414 Peachtree Rd., N.E.
Suite 1400
Macon, Georgia 31298
(404) 841-9200
Charter Palms Behavioral Texas 58-1416537 1421 E. Jackson Avenue
Health System, Inc. P.O. Box 5239
McAllen, TX 78502
(512) 631-5421
<PAGE>
Charter Peachford Behavioral Georgia 58-1086165 2151 Peachford Road
Health System, Inc. Atlanta, GA 30338
(404) 455-3200
Charter Pines Behavioral North Carolina 58-1462214 3621 Randolph Road
Health System, Inc. Charlotte, NC 28211
(704) 365-5368
Charter Plains Behavioral Texas 58-1462211 801 N. Quaker Avenue
Health System, Inc. Lubbock, TX 79408
(806) 744-5505
Charter-Provo School, Inc. Utah 58-1647690 4501 North University Ave.
Provo, UT 84604
(801) 227-2000
Charter Acquisition Subsidiary, Delaware 58-1852072 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Real Behavioral Texas 58-1485897 8550 Huebner Road
Health System, Inc. San Antonio, TX 78240
(512) 699-8585
Charter Regional Medical Texas 74-1299623 3414 Peachtree Rd., N.E.
Center, Inc. Suite 1400
Atlanta, Georgia 30326
(404) 841-9200
Charter Richmond Behavioral Virginia 58-1761160 3414 Peachtree Rd., N.E.
Health System, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Ridge Behavioral Kentucky 58-1393063 3050 Rio Dosa Drive
Health System, Inc. Lexington, KY 40509
(606) 269-2325
Charter Rivers Behavioral South Carolina 58-1408623 2900 Sunset Boulevard
Health System, Inc. West Columbia, SC 29169
(803) 796-9911
Charter San Diego Behavioral California 58-1669160 11878 Avenue of Industry
Health System, Inc. San Diego, CA 92128
(619) 487-3200
Charter Sioux Falls Behavioral South Dakota 58-1674278 2812 South Louise Avenue
Health System, Inc. Sioux Falls, SD 57106
(605) 361-8111
<PAGE>
Charter South Bend Behavioral Indiana 58-1674287 6704 N. Gumwood Drive
Health System, Inc. Granger, IN 46530
(219) 272-9799
Charter Springs Behavioral Florida 58-1517461 3130 S.W. 27th Avenue
Health System, Inc. Ocala, FL 32674
(904) 237-7293
Charter Springwood Virginia 58-2097829 Route 4, Box 50
Behavioral Health System, Inc. Leesburg, VA 22075
(703) 777-0800
Charter Suburban Hospital Texas 75-1161721 3414 Peachtree Rd., N.E.
of Mesquite, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Terre Haute Behavioral Indiana 58-1674293 1400 Crossing Boulevard
Health System, Inc. Terre Haute, IN 47802
Charter Thousand Oaks Behavioral California 58-1731069 150 Via Merida
Health System, Inc. Thousand Oaks, CA 91361
(805) 495-3292
Charter Treatment Center of Michigan 58-2025057 3414 Peachtree Rd., N.E.
Michigan, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Charter Westbrook Behavioral Virginia 54-0858777 1500 Westbrook Avenue
Health System, Inc. Richmond, VA 23227
(804) 266-9671
Charter White Oak Maryland 52-1866223 Post Office Box 56
Behavioral Health System, Inc. 1441 Taylors Island Road
Woolford, MD 21677
(410) 228-7000
Charter Wichita Behavioral Kansas 58-1634296 8901 East Orme
Health System, Inc. Wichita, KS 67207
(316) 686-5000
Charter Woods Behavioral Alabama 58-1330526 700 Cottonwood Road
Health System, Inc. Dothan, AL 36301
(205) 794-4357
Charter Woods Hospital, Inc. Alabama 58-2102628 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
<PAGE>
Charterton/LaGrange, Inc. Kentucky 61-0882911 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Desert Springs Hospital, Inc. Nevada 88-0117696 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, Georgia 30326
(404) 841-9200
Employee Assistance Services, Inc. Georgia 58-1501282 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Florida Health Facilities, Inc. Florida 58-1860493 21808 State Road 54Lutz, FL 33549
(813) 948-2441
Gulf Coast EAP Services, Inc. Alabama 58-2101394 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Gwinnett Immediate Care Georgia 58-1456097 3414 Peachtree Rd., N.E.
Center, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
HCS, Inc. Georgia 58-1527679 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Holcomb Bridge Immediate Georgia 58-1374463 3414 Peachtree Rd., N.E.
Care Center, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Hospital Investors, Inc. Georgia 58-1182191 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Illinois Mentor, Inc. Illinois 36-3643670 45 Milk Street
Boston, MA 02109
Magellan Health Services, Inc. Delaware 04-3250732 45 Milk Street
Boston, MA 02109
<PAGE>
Mandarin Meadows, Inc. Florida 58-1761155 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Massachusetts Mentor, Inc. Massachusetts 04-2799071 45 Milk Street
Boston, MA 02109
Metropolitan Hospital, Inc. Georgia 58-1124268 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Middle Georgia Hospital, Inc. Georgia 58-1121715 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
National Mentor, Inc. Delaware 04-2794857 45 Milk Street
Boston, MA 02109
National Mentor Healthcare, Inc. Massachusetts 04-2893910 45 Milk Street
Boston, MA 02109
NEPA - Massachusetts, Inc. Massachusetts 58-2116751 #6 Courthouse Lane
Chelmsford, MA 01863
(508) 441-2332
NEPA - New Hampshire, Inc. New Hampshire 58-2116398 29 Northwest Boulevard
Nashua, NH 03063
(603) 886-5000
Ohio Mentor, Inc. Ohio 31-1098345 45 Milk Street
Boston, MA 02109
Pacific-Charter Medical, Inc. California 58-1336537 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Pennsylvania Mentor, Inc. Pennsylvania 52-1638594 45 Milk Street
Boston, MA 02109
South Carolina Mentor, Inc. South Carolina 57-0782160 45 Milk Street
Boston, MA 02109
<PAGE>
Southeast Behavioral Systems, Georgia 58-2100700 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Rivoli, Inc. Georgia 58-1686160 3414 Peachtree Rd., N.E.
Suite 1400
Atlanta, GA 30326
(404) 841-9200
Schizophrenia Treatment and Georgia 58-1672912 209 Church Street
Rehabilitation, Inc. Decatur, GA 30030
(404) 377-1986
Shallowford Community Hospital, Georgia 58-1175951 3414 Peachtree Rd., N.E.
Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Sistemas De Terapia Georgia 58-1181077 3414 Peachtree Rd., N.E.
Respiratoria, S.A., Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
Stuart Circle Hospital Virginia 54-0855184 3414 Peachtree Rd., N.E.
Corporation Suite 1400
Atlanta, GA 30326
(404) 841-9200
Western Behavioral California 58-1662416 3414 Peachtree Rd., N.E.
Systems, Inc. Suite 1400
Atlanta, GA 30326
(404) 841-9200
(1) The Additional Registrants listed are wholly-owned subsidiaries of the Registrant and are guarantors of the Registrant's 11 1/4%
Series A Senior Subordinated Notes due 2004. The Additional Registrants have been conditionally exempted, pursuant to Section 12(h)
of the Securities Exchange Act of 1934, from filing reports under Section 13 of the Securities Exchange Act of 1934.
</TABLE>
<PAGE>
FORM 10-Q
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C> <C>
PART I - Financial Information:
Condensed Consolidated Balance Sheets -
September 30, 1994 and June 30, 1995. . . . . . . . . . . . . . . . . 4
Condensed Consolidated Statements of Operations -
For the Nine Months and Quarters ended
June 30, 1994 and 1995. . . . . . . . . . . . . . . . . . . . . . . . 6
Condensed Consolidated Statement of Changes in
Stockholders' Equity - For the Nine Months and
Quarter ended June 30, 1995 . . . . . . . . . . . . . . . . . . . . . 7
Condensed Consolidated Statements of Cash Flows -
For the Nine Months ended
June 30, 1994 and 1995. . . . . . . . . . . . . . . . . . . . . . . . 8
Notes to Condensed Consolidated Financial Statements . . . . . . . . . 9
Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . . .17
PART II - Other Information:
Item 6. - Exhibits and Reports on Form 8-K . . . . . . . . . . . . . .22
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
</TABLE>
<PAGE>
CHARTER MEDICAL CORPORATION
QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
PART I - FINANCIAL INFORMATION
<PAGE>
<TABLE>
<CAPTION>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
September 30 June 30
ASSETS 1994 1995 --
--------- --------
<S> <C> <C> <C>
Current Assets
Cash and cash equivalents . . . . . . . $129,603 $ 67,459
Accounts receivable, net. . . . . . . . 170,295 212,944
Supplies. . . . . . . . . . . . . . . . 6,097 6,526
Other current assets. . . . . . . . . . 18,632 14,741
------- -------
Total Current Assets . . . . . . . 324,627 301,670
Property and Equipment
Land. . . . . . . . . . . . . . . . . . 96,373 98,090
Buildings and improvements. . . . . . . 360,586 396,067
Equipment . . . . . . . . . . . . . . . 92,044 107,904
------- -------
549,003 602,061
Accumulated depreciation. . . . . . . . (56,967) (83,425)
------- -------
492,036 518,636
Construction in progress. . . . . . . . 2,309 2,845
------- -------
494,345 521,481
Assets Restricted for Settlement
of Unpaid Claims. . . . . . . . . . . . . . 74,532 89,926
Other Long-Term Assets . . . . . . . . . . . 14,355 23,559
Reorganization Value in Excess of Amounts
Allocable to Identifiable Assets, net. . . 26,001 2,600
Other Intangible Assets. . . . . . . . . . . 27,620 66,313
---------- ----------
$ 961,480 $1,005,549
---------- ----------
---------- ----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except shares and per share data)
September 30 June 30
LIABILITIES AND STOCKHOLDERS' EQUITY 1994 1995
------------ --------
<S> <C> <C> <C>
Current Liabilities
Accounts payable. . . . . . . . . . . . $50,745 $ 63,327
Accrued expenses and other current
liabilities. . . . . . . . . . . . . . 161,650 138,871
Current maturities of long-term debt and
capital lease obligations . . . . . . 2,653 6,670
------- -------
Total Current Liabilities . . . . . . . 215,048 208,868
Long-Term Debt and Capital Lease Obligations 533,476 539,587
Deferred Income Taxes. . . . . . . . . . . . 12,380 17,635
Reserve for Unpaid Claims. . . . . . . . . . 100,250 113,923
Deferred Credits and Other
Long-Term Liabilities . . . . . . . . . . . 44,105 42,405
Stockholders' Equity
Common Stock, par value $0.25 per share
Authorized - 80,000,000 shares
Issued and outstanding - 26,899,471
shares at September 30, 1994
and 28,395,255 shares at
June 30, 1995. . . . . . . . . . 6,725 7,099
Other Stockholders' Equity
Additional paid-in capital . . . . 244,339 249,530
Accumulated deficit. . . . . . . . (119,042) (131,946)
Unearned compensation
under ESOP . . . . . . . . . . . (73,527) (32,589)
Warrants outstanding . . . . . . . 180 75
Common Stock in Treasury,
271,928 shares . . . . . . . . . -- (4,712)
Note Receivable for shares . . . . -- (3,889)
Cumulative foreign currency
adjustments. . . . . . . . . . . (2,454) (437)
------ -----
Stockholders' Equity. . . . . 56,221 83,131
Commitments and Contingencies
------- ---------
$ 961,480 $ 1,005,549
------- ---------
------- ---------
The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these balance sheets.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
For the Three Months ended For the Nine Months ended
June 30 June 30
-------------------------- ------------------------
1994 1995 1994 1995
---------- ---------- --------- --------
<S> <C> <C> <C>
Net revenue . . . . . . . . . . . . . $220,857 $304,745 $642,284 $868,403
------- ------ ------ ------
Costs and expenses
Salaries, supplies and other
operating expenses . . . . . . . . 158,199 225,769 463,788 646,935
Bad debt expense. . . . . . . . . . 16,534 26,130 48,822 71,092
Depreciation and amortization . . . 6,792 9,929 20,371 28,347
Amortization of reorganization
value in excess of amounts
allocable to identifiable
assets . . . . . . . . . . . . . . 7,800 7,800 23,400 23,400
Interest, net . . . . . . . . . . . 10,279 13,789 27,064 41,190
ESOP expense. . . . . . . . . . . . 12,299 14,165 36,898 40,938
Stock option expense (credit) . . . 85 (841) 6,936 (4,158)
Unusual item. . . . . . . . . . . . -- -- -- 26,840
------- ------ ------ ------
211,988 296,741 627,279 874,584
------- ------ ------ ------
Income (loss) before provision
for income taxes and
extraordinary items . . . . . . . . . . 8,869 8,004 15,005 (6,181)
Provision for
income taxes. . . . . . . . . . . . . . 6,759 6,322 15,638 6,888
------- ------ ------ ------
Income (loss) before
extraordinary item. . . . . . . . . . . 2,110 1,682 (633) (13,069)
Extraordinary loss on early
extinguishment of debt (net of
income tax benefit of $8,410) . . . . . 12,616 -- 12,616 --
------- ------ ------ ------
Net income (loss) . . . . . . . . . . $(10,506) $ 1,682 $(13,249) (13,069)
------- ------ ------ ------
------- ------ ------ ------
Average number of common shares
outstanding . . . . . . . . . . . . . . 26,805 28,272 26,225 27,833
------- ------ ------ ------
------- ------ ------ ------
Earnings per common share:
Income (loss) before
extraordinary item . . . . . . . . $ .08 $ .06 $ (.02) $ (.47)
Extraordinary loss on early
extinguishment of debt . . . . . . (.47) -- (.48) --
------- ------ ------ ------
Net income (loss). . . . . . . . . . . . $ (.39) $ .06 $ (.50) $ (.47)
------- ------ ------ ------
------- ------ ------ ------
The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
(In thousands)
Common Stock
Common Stock in Treasury Additional
---------------- ---------------- Paid-in Accumlated
Shares Amount Shares Amount Capital Deficit
------ ------ ------ ------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at September 30, 1994 26,899 $6,725 -- -- $244,339 (119,042)
Additions (Deductions):
Net income. . . . . . . . . . -- -- -- -- -- (14,751)
ESOP expense. . . . . . . . . -- -- -- -- -- --
Stock option expense
(credit) . . . . . . . . . . -- -- -- -- (3,317) --
Exercise of options . . . . . 18 5 -- -- 162 --
Exercise of warrants. . . . . 43 11 -- -- 318 --
Foreign currency
translation gain . . . . . . -- -- -- -- -- --
Pooling of Mentor . . . . . . 1,410 352 -- -- 8,749 165
Purchase of Common Stock
for Treasury . . . . . . . . -- -- 42 (729) -- --
------ ----- ---- ---- ------- --------
Balance at March 31, 1995. . . . . 28,370 7,093 42 (729) 250,251 (133,628)
Additions (Deductions):
Net income. . . . . . . . . . -- -- -- -- -- 1,682
ESOP expense. . . . . . . . . -- -- -- -- -- --
Stock option
expense (credit) . . . . . . -- -- -- -- (841) --
Exercise of options . . . . . 25 6 -- -- 120 --
Foreign currency
translation loss . . . . . . -- -- -- -- -- --
Purchase of Common Stock
for Treasury . . . . . . . . -- -- 230 (3,983) -- --
--------- --------- -------- -------- ----------- ------------
Balance at June 30, 1995 . . . . . 28,395 $ 7,099 272 $ (4,712) $ 249,530 $ (131,946)
------ ----- ---- ---- ------- --------
------ ----- ---- ---- ------- --------
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (continued)
(Unaudited)
(In thousands)
Cumulative Notes
Unearned Foreign Receivable
Compensation Warrants Currency for
Under ESOP Outstanding Adjustments Shares
------------ ----------- ----------- ----------
Balance at September 30, 1994. . $(73,527) $ 180 $(2,454) --
Additions (Deductions):
Net loss. . . . . . . . . . -- -- -- --
ESOP expense. . . . . . . . 26,773 -- -- --
Stock option expense
(credit) . . . . . . . . . -- -- -- --
Exercise of options . . . . -- -- -- --
Exercise of warrants. . . . -- (105) -- --
Foreign currency
translation gain . . . . . -- -- 2,527 --
Pooling of Mentor . . . . . -- -- -- (3,889)
Purchase of Common Stock
for Treasury . . . . . . . -- -- -- --
-------- ----- ----- -----
Balance at March 31, 1995. . . . (46,754) 75 73 (3,889)
Additions (Deductions):
Net income. . . . . . . . . -- -- -- --
ESOP expense. . . . . . . . 14,165 -- -- --
Stock option
expense (credit) . . . . . -- -- -- --
Exercise of options . . . . -- -- -- --
Foreign currency
translation loss . . . . . -- -- (510) --
Purchase of Common Stock
for Treasury . . . . . . . -- -- -- --
-------- ----- ----- -----
Balance at June 30, 1995 . . . . $(32,589) $ 75 $ (437) $ (3,889)
-------- ----- ----- -----
-------- ----- ----- -----
The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
For the Nine Months ended
June 30
------------------------
1994 1995
--------- ---------
<S> <C> <C> <C> <C> <C>
Cash Flows From Operating Activities
Net loss . . . . . . . . . . . . . . . . . . $(13,249) $(13,069)
------ -------
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Depreciation and amortization . . . 43,771 51,747
ESOP expense. . . . . . . . . . . . 36,898 40,938
Non-cash portion of unusual items . -- 18,800
Stock option expense (credit) . . . 6,936 (4,158)
Non-cash interest expense . . . . . 2,005 1,802
Gain on sale of assets. . . . . . . -- (2,961)
Cash flows from changes in assets
and liabilities, net of effects
from sales and acquisitions of
businesses:
Accounts receivable, net. . . . (10,605) (13,749)
Other assets. . . . . . . . . . 3,977 (10,203)
Accounts payable and other
accrued liabilities. . . . . . (9,987) (21,402)
Reserve for unpaid claims . . . (1,340) 9,473
Income taxes payable. . . . . . (3,236) 2,076
Other liabilities . . . . . . . (5,665) (20,641)
Extraordinary loss on
early extinguishment of debt . . . 12,616 --
Other . . . . . . . . . . . . . . . 3,293 545
------ -------
Total adjustments . . . . . . . 78,663 52,267
------ -------
Net cash provided by
operating activities. . . . 65,414 39,198
------ -------
Cash Flows From Investing Activities
Capital expenditures. . . . . . . . . . . . . (12,976) (12,077)
Acquisitions of businesses. . . . . . . . . . (129,816) (61,473)
(Increase) Decrease in assets restricted
for settlement of unpaid claims. . . . . . . 8,794 (15,394)
Proceeds from sale of assets. . . . . . . . . 12,857 5,879
------ -------
Net cash used in
investing activities . . . . . . . (121,141) (83,065)
------ -------
Cash Flows From Financing Activities
Proceeds from issuance of debt. . . . . . . . 381,798 28,009
Payments on debt and capital lease
obligations . . . . . . . . . . . . . . . (310,464) (42,091)
Treasury stock transactions . . . . . . . . . -- (4,712)
Proceeds from exercise of stock options
and warrants . . . . . . . . . . . . . . . 1,302 517
Tax benefit related to the exercise
of stock options . . . . . . . . . . . . . . 9,424 --
Income tax payments made on behalf of
stock optionee . . . . . . . . . . . . . . . (14,214) --
Increase in cash collateral account . . . . . 5,426 --
------ -------
Net cash provided by (used in)
financing activities . . . . . . . 73,272 (18,277)
------ -------
Net decrease in cash and cash equivalents. . . . . 17,545 (62,144)
Cash and cash equivalents at beginning
of period . . . . . . . . . . . . . . . 86,002 129,603
------ -------
Cash and cash equivalents at end of period . . . . $ 103,547 $ 67,459
------ -------
------ -------
The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1995
(Unaudited)
NOTE A - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments, consisting of normal recurring
adjustments considered necessary for a fair presentation, have been included.
These financial statements should be read in conjunction with the audited
consolidated financial statements of the Company for the year ended September
30, 1994, included in the Company's Annual Report on Form 10-K.
NOTE B - Nature of Business
The Company's business is seasonal in nature, with a reduced demand for
certain services generally occurring in the fourth fiscal quarter and around
major holidays, such as Thanksgiving and Christmas. The Company's business is
also subject to general economic conditions and other factors. Accordingly, the
results of operations for the interim periods are not necessarily indicative of
the actual results expected for the year.
NOTE C - Supplemental Cash Flow Information
Below is supplemental cash flow information related to the nine months
ended June 30, 1994 and 1995:
<TABLE>
<CAPTION>
For the Nine Months ended
June 30
------------------------
1994 1995
--------- -------
(In thousands)
<S> <C> <C>
Income taxes paid, net of refunds received . . . $ 9,531 $ 3,788
Interest paid, net of amounts capitalized. . . . 22,695 51,113
</TABLE>
NOTE D - LONG-TERM DEBT AND LEASES
Information with regard to the Company's long-term debt and capital lease
obligations at September 30, 1994 and June 30, 1995 follows:
<TABLE>
<CAPTION>
September 30 June 30
1994 1995
------------ --------
(In thousands)
<S> <C> <C> <C>
Revolving Credit Agreement due
through 1999 (8.1875% at June
30, 1995) . . . . . . . . . . . . . . . $ 72,584 $ 80,593
11.25% Senior Subordinated
Notes due 2004. . . . . . . . . . . . . . 375,000 375,000
6.06% to 10.75% Mortgage and other
notes payable through 1999. . . . . . . . 6,434 9,339
Variable rate secured notes due
through 2013 (4.15% to 4.40% at
June 30, 1995). . . . . . . . . . . . . . 63,125 62,625
7.5% Swiss Bonds . . . . . . . . . . . . . 6,443 6,443
4.20% to 12.5% Capital lease
obligations due through 2014. . . . . . . 12,870 12,633
------ ------
536,456 546,633
Less amounts due within one year. . . . 2,653 6,670
Less debt service funds . . . . . . . . 327 376
------- ------
$533,476 $539,587
------- ------
------- ------
</TABLE>
<PAGE>
NOTE E - ACQUISITIONS AND JOINT VENTURES
Acquisitions
The Company purchased substantially all of the assets of 29 psychiatric
hospitals, eight chemical dependency treatment facilities, two residential
treatment centers and one physician outpatient practice, including related
outpatient facilities and other associated assets from National Medical
Enterprises, Inc. (the "Acquired Hospitals"). The acquisition occurred in three
phases with the purchase of 27, three and ten of the Acquired Hospitals on June
30, October 31, and November 30, 1994, respectively. The Company accounted for
the acquisition using the purchase method of accounting. The Company's
Consolidated Statement of Operations for the nine months ended June 30, 1995
includes results of operations of 27 of the Acquired Hospitals for the nine
months, results of operations of three of the Acquired Hospitals (sold in
December 1994) for two months and results of operations of ten of the Acquired
Hospitals for seven months.
The purchases of the Acquired Hospitals have been considered one transaction
for pro forma disclosure purposes. Below are unaudited pro forma results of
operations for the nine months ended June 30, 1994 and 1995 as though the
Acquired Hospitals had been purchased on October 1, 1993 and 1994,
respectively. The pro forma information does not purport to be indicative of
the results which would actually have been attained had the acquisition been
completed on such date or which may be attained in the future. (In thousands,
except for per share data)
<TABLE>
<CAPTION>
For the Nine Months Ended
------------------------------------------------------
June 30, 1994 June 30, 1995
------------------------ ------------------------
Actual Pro Forma Actual Pro Forma
------ --------- ------ --------
<S> <C> <C> <C> <C>
Net revenue. . . . . . $642,284 $855,096 $868,403 $880,753
Income (loss)
before extra-
ordinary item . . . . $ (633) $ 93 $(13,069) $(12,466)
Net loss . . . . . . . $(13,249) $(12,523) $(13,069) $(12,466)
Income (loss) per
common share before
extraordinary item. . $ (.02) $ -- $ (.47) $ (.45)
Net loss per
common share. . . . . $ (.50) $ (.48) $ (.47) $ (.45)
</TABLE>
In January 1995, the Company issued 1,409,978 common shares in
exchange for all the outstanding common and preferred stock of Magellan Health
Services, Inc. ("Magellan"). Magellan owns National Mentor, Inc., which
provides specialized health services in mentor homes. The acquisition was
accounted for as a pooling of interests, effective January 1, 1995.
In February 1995, the Company acquired Westwood Pembroke Health System
which includes two psychiatric hospitals and a professional group practice. The
Company accounted for the acquisition using the purchase method of accounting.
In June 1995, the Company purchased substantially all of the assets of
Cypress Hospital from Louisiana Psychiatric Company, Inc., a subsidiary of
Columbia/HCA Healthcare Corporation ("Columbia"). The Company accounted for the
acquisition using the purchase method of accounting.
Joint Ventures
The Company entered into joint ventures with Columbia in the Raleigh,
North Carolina and Albuquerque, New Mexico markets. Effective May 31, 1995,
Charter Behavioral Health System of New Mexico, a subsidiary of the Company, and
New Mexico Psychiatric Company, a subsidiary of Columbia, formed Charter Heights
Behavioral Health System ("Heights"). The Company leased and contributed
certain assets of its Albuquerque Hospital to Heights in exchange for a 67%
interest and Columbia leased and contributed certain assets of its Columbia
Heights Hospital to Heights in exchange for a 33% interest. Heights' assets,
liabilities and operations are included in the Company's financial statements
less minority interest.
<PAGE>
Effective June 30, 1995, Charter Northridge Behavioral Health System,
a subsidiary of the Company, and Wake Psychiatric Hospital, a subsidiary of
Columbia, formed the Holly Hill/Charter Behavioral Health System ("Holly
Hill"). The Company leased and contributed certain assets of its Northridge
Hospital to Holly Hill in exchange for a 50% interest and Columbia leased and
contributed certain assets of its Holly Hill Hospital to Holly Hill in exchange
for the remaining 50% interest. The Company accounts for its investment in
Holly Hill under the equity method of accounting.
NOTE F - Unusual Items
In December 1994, the Company recorded an unusual item of
approximately $3 million which represented the pre-tax gain on the sale of three
psychiatric hospitals.
In March 1995, the Company and a group of insurance carriers resolved
disputes that arose in fiscal 1995 related to claims paid predominantly in the
1980's. As part of the resolution, the Company will pay the insurance carriers
$29.8 million in five installments over a three year period. The Company and
the insurance carriers intend to continue to do business with each other and
maintain business at the same or similar general levels. No existing agreement,
contract, joint venture, or other business relationship in existence at the time
of the settlement will be terminated or affected as a result of the settlement.
Furthermore, the parties will negotiate in good faith concerning additional
business opportunities.
NOTE G - Contingencies
The Company is self-insured for a substantial portion of general and
professional liability risks. The reserves for self-insured general and
professional liability losses, including loss adjustment expenses, are based on
actuarial estimates using the Company's historical claims experience adjusted
for current industry trends. The reserve for unpaid claims is adjusted as such
claims mature, to reflect revised actuarial estimates based on actual
experience. While management and its actuaries believe that the present reserve
is reasonable, ultimate settlement of losses may vary from the amount provided.
In addition to general and professional liability claims, the Company
is subject to other claims, suits, surveys and investigations. In the opinion
of management, the ultimate resolution of such other pending legal proceedings
will not have a material adverse effect on the Company's financial position or
results of operations.
The Resolution Trust Corporation ("RTC"), for itself or in its
capacity as conservator or receiver for 12 financial institutions, formerly held
certain debt securities that were issued by the Company in 1988. RTC has
indicated to the Company that it believes that certain financial statements and
other disclosures made by the Company in connection with such debt securities
contained materially misleading statements or material omissions and that such
misleading statements or omissions resulted in an overvaluation of such debt
securities. The Company has agreed to a tolling of the statute of limitations
applicable to RTC's potential claims. Based on a review of relevant law and the
facts known to the Company, the Company believes it has a substantial defense to
a potential claim by RTC and that such potential claim would not have a material
adverse effect on the Company's financial position or results of operations.
<PAGE>
<TABLE>
<CAPTION>
NOTE H - GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands, except shares and per share amounts)
June 30, 1995
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
ASSETS Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Current Assets
Cash and cash equivalents . . . . . $ 36,499 $ 5,517 $ 25,443 $ -- $ 67,459
Accounts receivable, net. . . . . . 199,268 12,595 1,081 -- 212,944
Supplies .. . . . . . . . . . . . . 5,877 226 423 -- 6,526
Other current assets. . . . . . . . 7,211 780 3,686 3,064 14,741
------- ------- -------- --------- -------
Total Current Assets . . . . . 248,855 19,118 30,633 3,064 301,670
Property and Equipment
Land. . . . . . . . . . . . . . . . 89,853 7,223 1,014 -- 98,090
Buildings and improvements. . . . . 385,342 21,188 (10,463) -- 396,067
Equipment . . . . . . . . . . . . . 96,567 8,162 3,175 -- 107,904
------- ------- -------- --------- -------
571,762 36,573 (6,274) -- 602,061
Accumulated depreciation. . . . . . (79,973) (3,297) (155) -- (83,425)
Construction in progress. . . . . . 1,986 833 26 -- 2,845
------- ------- -------- --------- -------
493,775 34,109 (6,403) -- 521,481
Assets restricted for settlement
of unpaid claims. . . . . . . . . . . . -- 73,186 16,740 -- 89,926
Other Long-Term Assets(1). . . . . . . . 95,726 30,966 1,111,787 (1,148,607) 89,872
Reorganization Value in Excess
of Amounts Allocable to
Identifiable Assets, net. . . . . . . . -- -- 2,600 -- 2,600
------- ------- -------- --------- -------
$838,356 $157,379 $1,155,357 $(1,145,543) $ 1,005,549
------- ------- -------- --------- -------
------- ------- -------- --------- -------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable. . . . . . . . . . $ 46,802 $ 6,723 $ 9,802 $ -- $ 63,327
Accrued expenses and other
current liabilities. . . . . . . . 55,597 2,383 79,559 1,332 138,871
Current maturities of long-
term debt and capital
lease obligations. . . . . . . . . 6,546 124 -- -- 6,670
------- ------- -------- --------- -------
Total Current
Liabilities . . . . . . . . . 108,945 9,230 89,361 1,332 208,868
Long-Term Debt and Capital
Lease Obligations . . . . . . . . . . . (319,991) 3,300 856,278 -- 539,587
Deferred Income Taxes. . . . . . . . . . -- 722 11,774 5,139 17,635
Reserve for Unpaid Claims. . . . . . . . -- 67,277 43,582 3,064 113,923
Deferred Credits and Other
Long-Term Liabilities (1) . . . . . . . 322,862 24,168 71,231 (375,856) 42,405
Stockholders' Equity
Common Stock, par value
$0.25 per share
Authorized - 80,000,000
shares
Issued and outstanding -
28,395,255 shares . . . . . . 2,872 837 7,099 (3,709) 7,099
Other Stockholders' Equity
Additional paid-in
capital . . . . . . . . . . . 712,645 32,521 249,530 (745,166) 249,530
Retained earnings
(Accumulated deficit) . . . . 15,704 21,236 (131,946) (36,940) (131,946)
Unearned compensation
under ESOP. . . . . . . . . . -- -- (32,589) -- (32,589)
Warrants outstanding . . . . . -- -- 75 -- 75
Common shares in
Treasury. . . . . . . . . . . -- (3,893) (4,712) 3,893 (4,712)
Notes Receivable for
Shares. . . . . . . . . . . . (3,889) -- (3,889) 3,889 (3,889)
Cumulative foreign
currency adjustments. . . . . (792) 1,981 (437) (1,189) (437)
------- ------- -------- --------- -------
726,540 52,682 83,131 (779,222) 83,131
Commitments and Contingencies ------- ------- -------- --------- -------
$838,356 $ 157,379 $1,155,357 $(1,145,543) $1,005,549
------- ------- -------- --------- -------
------- ------- -------- --------- -------
(1) Elimination entry related to intercompany receivables and payables and investment in consolidated subsidiaries.
The accompanying Notes to Condensed Consolidating Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NOTE H - GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (CONTINUED)
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands, except shares and per share amounts)
September 30, 1994
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
ASSETS Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Current Assets
Cash and cash equivalents . . . . $ 71,850 $ 8,606 $ 49,147 $ -- $129,603
Accounts receivable, net. . . . . 166,191 2,780 1,324 -- 170,295
Supplies .. . . . . . . . . . . . 5,713 75 309 -- 6,097
Other current assets. . . . . . . 11,461 177 19,018 (12,024) 18,632
------- ------- -------- --------- -------
Total Current Assets . . . . 255,215 11,638 69,798 (12,024) 324,627
Property and Equipment
Land. . . . . . . . . . . . . . . 89,340 6,019 1,014 -- 96,373
Buildings and improvements. . . . 369,518 5,666 (14,598) -- 360,586
Equipment . . . . . . . . . . . . 88,483 1,262 2,299 -- 92,044
------- ------- -------- --------- -------
547,341 12,947 (11,285) -- 549,003
Accumulated depreciation. . . . . (55,505) (1,056) (406) -- (56,967)
Construction in progress. . . . . 2,143 166 -- - 2,309
------- ------- -------- --------- -------
493,979 12,057 (11,691) - 494,345
Assets restricted for settlement
of unpaid claims. . . . . . . . . . . -- 61,475 13,057 -- 74,532
Other Long-Term Assets(1). . . . . . . 52,438 14,385 988,259 (1,013,107) 41,975
Reorganization Value in Excess
of Amounts Allocable to
Identifiable Assets, net. . . . . . . -- -- 26,001 -- 26,001
------- ------- --------- --------- -------
$801,632 $99,555 $1,085,424 $(1,025,131) $961,480
------- ------- --------- --------- -------
------- ------- --------- --------- -------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable. . . . . . . . . $ 43,476 $ 1,107 $ 6,162 $ -- $ 50,745
Accrued expenses and other
current liabilities. . . . . . . 63,742 1,684 96,224 -- 161,650
Current maturities of long-
term debt and capital
lease obligations. . . . . . . . 2,537 116 -- -- 2,653
------- ------- -------- --------- -------
Total Current
Liabilities . . . . . . . . 109,755 2,907 102,386 -- 215,048
Long-Term Debt and Capital
Lease Obligations . . . . . . . . . . (258,010) 1,497 789,989 -- 533,476
Deferred Income Taxes. . . . . . . . . -- 647 11,733 -- 12,380
Reserve for Unpaid Claims. . . . . . . -- 54,759 57,515 (12,024) 100,250
Deferred Credits and Other
Long-Term Liabilities (1) . . . . . . 349,146 669 67,580 (373,290) 44,105
Stockholders' Equity
Common Stock, par value
$0.25 per share
Authorized - 80,000,000
shares
Issued and outstanding -
26,899,471 shares . . . . . 2,866 587 6,725 (3,453) 6,725
Other Stockholders' Equity
Additional paid-in
capital . . . . . . . . . . 707,744 30,455 244,339 (738,199) 244,339
Retained earnings
(Accumulated deficit) . . . (109,093) 7,734 (119,042) 101,359 (119,042)
Unearned compensation
under ESOP. . . . . . . . . -- -- (73,527) -- (73,527)
Warrants outstanding . . . . -- -- 180 -- 180
Cumulative foreign
currency adjustments. . . . (776) 300 (2,454) 476 (2,454)
------- ------ --------- ---------- --------
600,741 39,076 56,221 (639,817) 56,221
Commitments and Contingencies ------- ------ --------- ---------- --------
$801,632 $99,555 $1,085,424 $(1,025,131) $961,480
------- ------- --------- --------- -------
------- ------- --------- --------- -------
(1) Elimination entry related to intercompany receivables and payables and investment in consolidated subsidiaries.
The accompanying Notes to Condensed Consolidating Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NOTE H - GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (CONTINUED)
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands, except shares and per share amounts)
For the Quarter ended June 30, 1995
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenue. . . . . . . . . . . . . $273,854 $33,657 $ 3,592 $ (6,358) $ 304,745
Costs and expenses
Salaries, supplies and
other operating expenses.. . . . 192,826 33,256 5,898 (6,211) 225,769
Bad debt expense. . . . . . . . . 24,868 1,262 -- -- 26,130
Depreciation and
amortization . . . . . . . . . . 8,229 1,140 707 (147) 9,929
Amortization of
reorganization value in
excess of amounts allocable
to identifiable assets . . . . . -- -- 7,800 -- 7,800
Interest, net . . . . . . . . . . (7,946) (115) 21,850 -- 13,789
ESOP expense. . . . . . . . . . . 13,324 -- 841 -- 14,165
Stock option
expense (credit) . . . . . . . . -- -- (841) -- (841)
------- ------ ------ ----- ------
231,301 35,543 36,255 (6,358) 296,741
------- ------ ------ ----- -------
Income (loss) before income taxes
and equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 42,553 (1,886) (32,663) -- 8,004
Provision for (benefit from)
income taxes. . . . . . . . . . . . . (136) -- -- 6,458 6,322
------- ------ ------ ----- -------
Income (loss) before equity in
earnings (loss) of
subsidiaries. . . . . . . . . . . . . 42,689 (1,886) (32,663) (6,458) 1,682
Equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 997 -- 34,345 (35,342) --
------- ------ ------ ----- -------
Net income (loss). . . . . . . . . . . $ 43,686 $(1,886) $ 1,682 $(41,800) $ 1,682
------- ------ ------ ----- -------
------- ------ ------ ----- -------
</TABLE>
<TABLE>
<CAPTION>
For the Quarter ended June 30, 1994
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenue. . . . . . . . . . . . . . $219,116 $5,754 $ 22 $ (4,035) $220,857
Costs and expenses
Salaries, supplies and
other operating expenses.. . . . 146,956 5,005 10,272 (4,034) 158,199
Bad debt expense. . . . . . . . . 16,543 (4) (5) -- 16,534
Depreciation and
amortization . . . . . . . . . . 6,803 (124) 113 -- 6,792
Amortization of
reorganization value in
excess of amounts allocable
to identifiable assets . . . . . -- -- 7,800 -- 7,800
Interest, net . . . . . . . . . . (5,467) (52) 15,792 6 10,279
ESOP expense. . . . . . . . . . . 11,255 -- 1,044 -- 12,299
Stock option
expense . . . . . . . . . . . . -- -- 85 -- 85
------- ------ ------ ----- -------
176,090 4,825 35,101 (4,028) 211,988
Income (loss) before income taxes,
equity in earnings (loss) of
subsidiaries and extraordinary
item. . . . . . . . . . . . . . . . . 43,026 929 (35,079) (7) 8,869
Provision for income taxes . . . . . . -- -- -- 6,759 6,759
------- ------ ------ ----- -------
Income (loss) before equity in
earnings (loss) of
subsidiaries and
extraordinary item. . . . . . . . . . 43,026 929 (35,079) (7) 8,869
Equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 570 - 44,532 (45,102) --
------- ------ ------ ------ -------
Income (loss) before extraordinary
item. . . . . . . . . . . . . . . . . 43,596 929 9,453 (51,868) 2,110
Extraordinary gain (loss)
on early discharge of debt. . . . . . (1,067) -- (19,959) 8,410 (12,616)
------- ------ ------ ------ -------
Net income (loss). . . . . . . . . . . $ 42,529 $ 929 $(10,506) $(43,458) $(10,506)
------- ------ ------ ------ -------
------- ------ ------ ------ -------
The accompanying Notes to Condensed Consolidating Financial Statements are an integral part of these balance sheets.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NOTE H - GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (CONTINUED)
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands, except shares and per share amounts)
For the Nine Months ended June 30, 1995
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenue. . . . . . . . . . . . . . $827,011 $58,523 $ (88) $ (17,043) $868,403
Costs and expenses
Salaries, supplies and
other operating expenses.. . . . 589,771 57,412 16,424 (16,672) 646,935
Bad debt expense. . . . . . . . . 71,664 1,439 (2,011) -- 71,092
Depreciation and
amortization . . . . . . . . . . 26,352 1,862 503 (370) 28,347
Amortization of
reorganization value in
excess of amounts allocable
to identifiable assets . . . . . -- -- 23,400 -- 23,400
Interest, net . . . . . . . . . . (23,746) (77) 65,013 -- 41,190
ESOP expense. . . . . . . . . . . 40,293 -- 650 (5) 40,938
Unusual items . . . . . . . . . . -- -- 26,840 -- 26,840
Stock option
expense (credit) . . . . . . . . -- -- (4,158) -- (4,158)
------- ------ ------ ------ -------
704,334 60,636 126,661 (17,047) 874,584
------- ------ ------ ------ -------
Income (loss) before income taxes
and equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 122,677 (2,113) (126,749) 4 (6,181)
Provision for income taxes . . . . . . 418 -- -- 6,470 6,888
------- ------ ------ ----- -------
Income (loss) before equity in
earnings (loss) of
subsidiaries. . . . . . . . . . . . . 122,259 (2,113) (126,749) (6,466) (13,069)
Equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 2,252 -- 113,680 (115,932) --
------- ------ ------ ------ -------
Net income (loss). . . . . . . . . . . $124,511 $ (2,113) $(13,069) $(122,398) $(13,069)
------- ------ ------ ------ -------
------- ------ ------ ------ -------
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Cash provided by (used in)
operating activities. . . . . . . . . $61,387 $17,483 $(39,672) $ -- $39,198
------- ------ ------ ------ -------
Cash Flows from Investing Activities:
Capital expenditures. . . . . . . (8,992) (2,052) (1,033) -- (12,077)
Proceeds from sale of assets. . . -- -- 5,879 -- 5,879
Acquisitions of businesses . . . (57,783) (3,690) -- -- (61,473)
Increase in assets
restricted for settlement
of unpaid claims . . . . . . . . -- (11,711) (3,683) -- (15,394)
------- ------ ------ ------ -------
Cash provided by (used in)
investing activities. . . . . . . (66,775) (17,453) 1,163 -- (83,065)
------- ------ ------ ------ -------
Cash Flows from Financing Activities:
Proceeds from issuance
of debt. . . . . . . . . . . . . 28,009 -- -- -- 28,009
Payments on debt and capital
obligations. . . . . . . . . . . (57,972) 864 15,017 -- (42,091)
Treasury Stock transactions . . . -- (3,983) (729) -- (4,712)
Proceeds from exercise of
stock option and warrants. . . . -- -- 517 -- 517
------- ------ ------ ------ -------
Cash provided by (used in)
financing activities. . . . . . . . . (29,963) (3,119) 14,805 -- (18,277)
------- ------ ------ ------ -------
Net increase (decrease) in cash
and cash equivalents. . . . . . . . . (35,351) (3,089) (23,704) -- (62,144)
Cash and cash equivalents at
beginning of period . . . . . . . . . 71,850 8,606 49,147 -- 129,603
------- ------ ------ ------ -------
Cash and cash equivalents at
end of period . . . . . . . . . . . . $ 36,499 $ 5,517 $ 25,443 $ -- $ 67,459
------- ------ ------ ------ -------
------- ------ ------ ------ -------
The accompanying Notes to Condensed Consolidating Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NOTE H - GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (CONTINUED)
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands, except shares and per share amounts)
For the Nine Months ended June 30, 1994
-------------------------------------------------------------------------------------------
Charter Medical
Corporation Consolidated
Guarantor Nonguarantor (Parent Elimination Consolidated
Subsidiaries Subsidiaries Corporation) Entries Total
------------ ------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenue. . . . . . . . . . . . . . $635,004 $16,435 $ 2,443 $ (11,508) $642,284
Costs and expenses
Salaries, supplies and
other operating expenses.. . . . 437,770 13,713 23,813 (11,508) 463,788
Bad debt expense. . . . . . . . . 49,102 (48) (232) -- 48,822
Depreciation and
amortization . . . . . . . . . . 19,571 330 470 -- 20,371
Amortization of
reorganization value in
excess of amounts allocable
to identifiable assets . . . . . -- -- 23,400 -- 23,400
Interest, net . . . . . . . . . . (13,777) (41) 40,882 -- 27,064
ESOP expense. . . . . . . . . . . 33,661 -- 3,134 103 36,898
Stock option
expense. . . . . . . . . . . . . -- -- 6,936 -- 6,936
------- ------ ------ ------ -------
526,327 13,954 98,403 (11,405) 627,279
------- ------ ------ ------ -------
Income (loss) before income taxes,
equity in earnings (loss)
of subsidiaries and
extraordinary item. . . . . . . . . . 108,677 2,391 (95,960) (103) 15,005
Provision for income taxes . . . . . . -- -- -- 15,638 15,638
------- ------ ------ ----- -------
Income (loss) before equity in
earnings (loss) of
subsidiaries and
extraordinary item. . . . . . . . . . 108,677 2,391 (9,560) (15,741) (633)
Equity in earnings (loss)
of subsidiaries . . . . . . . . . . . 1,605 -- 102,670 (104,275) --
------- ------ ------ ------ -------
Income (loss) before
extraordinary item. . . . . . . . . . 110,282 2,391 6,710 (120,016) (633)
Extraordinary gain (loss) on
early discharge of debt . . . . . . . (1,067) -- (19,959) 8,410 (12,616)
------- ------ ------ ------ -------
Net income (loss). . . . . . . . . . . $109,215 $ 2,391 $(13,249) $(111,606) $(13,249)
------- ------ ------ ------ -------
------- ------ ------ ------ -------
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Cash provided by (used in)
operating activities. . . . . . . . . $140,930 $ 798 $(76,314) $ -- $65,414
Cash Flows from Investing Activities:
Capital expenditures. . . . . . . (11,732) (1,194) (50) -- (12,976)
Proceeds from sale of assets. . . 7,857 -- 5,000 -- 12,587
Acquisitions of businesses . . . (129,816) -- -- -- (129,816)
Decrease in assets
restricted for settlement
of unpaid claims . . . . . . . . -- 2,024 6,770 -- 8,794
------- ------ ------ ------- -------
Cash provided by (used in)
investing activities. . . . . . . (133,691) 830 11,720 -- (121,141)
Cash Flows from Financing Activities:
Decrease in cash
collateral account . . . . . . . -- -- 5,426 -- 5,426
Proceeds from issuance
of debt. . . . . . . . . . . . . 25,862 -- 355,936 -- 381,798
Payments on debt and capital
obligations. . . . . . . . . . . (18,716) (58) (291,690) -- (310,464)
Other financing activities. . . . -- -- (3,488) -- (3,488)
------- ------ ------ ------- -------
Cash provided by (used in)
financing activities. . . . . . . . . 7,146 (58) 66,184 -- 73,272
------- ------ ------ ------- -------
Net increase (decrease) in cash
and cash equivalents. . . . . . . . . 14,385 1,570 1,590 -- 17,545
Cash and cash equivalents at
beginning of period . . . . . . . . . 45,147 2,756 38,099 -- 86,002
------- ------ ------ ------- -------
Cash and cash equivalents at
end of period . . . . . . . . . . . . $ 59,532 $ 4,326 $ 39,689 $ -- $103,547
------- ------ ------ ------- -------
------- ------ ------ ------- -------
The accompanying Notes to Condensed Consolidating Financial Statements are an integral part of these statements.
</TABLE>
<PAGE>
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
June 30, 1995
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Acquisitions
The Company purchased substantially all of the assets of 29 psychiatric
hospitals, eight chemical dependency treatment facilities, two residential
treatment centers and one physician outpatient practice, including related
outpatient facilities and other associated assets from National Medical
Enterprises, Inc. (the "Acquired Hospitals"). The acquisition occurred in three
phases with the purchase of 27, three and ten of the Acquired Hospitals on June
30, October 31, and November 30, 1994, respectively. The Company accounted for
the acquisition using the purchase method of accounting. The Company's
Consolidated Statement of Operations for the nine months ended June 30, 1995
includes results of operations of 27 of the Acquired Hospitals for the nine
months, results of operations of three of the Acquired Hospitals (sold in
December 1994) for two months and results of operations of ten of the Acquired
Hospitals for seven months.
In January 1995, the Company issued 1,409,978 common shares in exchange for
all the outstanding common and preferred stock of Magellan Health Services, Inc.
("Magellan"). Magellan owns National Mentor, Inc., which provides specialized
health services in mentor homes. The acquisition was accounted for as a pooling
of interests, effective January 1, 1995.
In February 1995, the Company acquired Westwood Pembroke Health System
which includes two psychiatric hospitals and a professional group practice. The
Company accounted for the acquisition using the purchase method of accounting.
In June 1995, the Company purchased substantially all of the assets of
Cypress Hospital from Louisiana Psychiatric Company, Inc., a subsidiary of
Columbia. The Company accounted for the acquisition using the purchase method
of accounting.
Joint Ventures
The Company entered into joint ventures with Columbia in the Raleigh, North
Carolina and Albuquerque, New Mexico markets. Effective May 31, 1995, Charter
Behavioral Health System of New Mexico, a subsidiary of the Company, and New
Mexico Psychiatric Company, a subsidiary of Columbia, formed Charter Heights
Behavioral Health System ("Heights"). The Company leased and contributed
certain assets of its Albuquerque Hospital to Heights in exchange for a 67%
interest and Columbia leased and contributed certain assets of its Columbia
Heights Hospital to Heights in exchange for a 33% interest. Heights' assets,
liabilities and operations are included in the Company's financial statements
less minority interest.
Effective June 30, 1995, Charter Northridge Behavioral Health System, a
subsidiary of the Company, and Wake Psychiatric Hospital, a subsidiary of
Columbia, formed the Holly Hill/Charter Behavioral Health System ("Holly
Hill"). The Company leased and contributed certain assets of its Northridge
Hospital to Holly Hill in exchange for a 50% interest and Columbia leased and
contributed certain assets of its Holly Hill Hospital to Holly Hill in exchange
for the remaining 50% interest. The Company accounts for its investment in
Holly Hill under the equity method.
<PAGE>
Results of Operations
Selected statistics (from the date of acquisition for acquired facilities)
for the 108 psychiatric hospitals in operation at June 30, 1995, by quarter for
fiscal 1994 and fiscal 1995 follows:
<TABLE>
<CAPTION>
FISCAL FISCAL %
1994 1995 CHANGE
------ ------ ------
<S> <C> <C> <C> <C>
Licensed beds at:
December 31 . . . . . . . . 6,696 9,129 36%
March 31 . . . . . . . . . . 6,681 9,344 40
June 30. . . . . . . . . . . 6,681 9,446 41
September 30 . . . . . . . . 8,551
Net revenue (in thousands):
Quarter:
First. . . . . . . . . . $194,623 $237,541 22%
Second . . . . . . . . . 195,688 261,609 34
Third. . . . . . . . . . 204,088 270,275 32
Fourth . . . . . . . . . 240,949
-------
Year . . . . . . . . . . . . $835,348
-------
-------
Patient days:
Quarter:
First. . . . . . . . . . 315,917 401,938 27%
Second . . . . . . . . . 324,881 450,047 39
Third. . . . . . . . . . 327,362 453,784 39
Fourth . . . . . . . . . 393,508
-------
Year . . . . . . . . . . . . 1,361,668
-------
-------
Equivalent patient days:
Quarter:
First. . . . . . . . . . 344,282 448,043 30%
Second . . . . . . . . . 357,380 501,036 40
Third. . . . . . . . . . 364,014 505,557 39
Fourth . . . . . . . . . 437,398
---------
Year . . . . . . . . . . . . 1,503,074
---------
---------
Net revenue per equivalent patient day:
Quarter:
First. . . . . . . . . . $565 $530 (6)%
Second . . . . . . . . . 548 522 (5)
Third. . . . . . . . . . 561 535 (5)
Fourth . . . . . . . . . 551
Year . . . . . . . . . . . . 556
Admissions:
Quarter:
First. . . . . . . . . . 21,310 29,321 38%
Second . . . . . . . . . 24,431 33,892 39
Third. . . . . . . . . . 24,573 33,381 36
Fourth . . . . . . . . . 29,908
------
Year . . . . . . . . . . . . 100,222
------
------
<PAGE>
FISCAL FISCAL %
1994 1995 CHANGE
------ ------ ------
Average length of stay:
Quarter:
First. . . . . . . . . . 14.7 13.5 (8)%
Second . . . . . . . . . 13.5 12.7 (6)
Third. . . . . . . . . . 13.2 12.9 (2)
Fourth . . . . . . . . . 13.5
Year . . . . . . . . . . . . 13.7
Selected statistics for the same store psychiatric hospitals in operations
during the quarters and nine months ended June 30, 1994 and 1995.
QUARTER ENDED
-------------
JUNE 30 JUNE 30 %
1994 1995 CHANGE
------ ------ ------
*Number of psychiatric
hospitals . . . . . . . . . . 73 72 (1)
Average licensed beds. . . . . 6,681 6,568 (2)
Net revenue (in thousands) . . $204,088 $192,644 (6)
Patient days . . . . . . . . . 327,362 313,304 (4)
Equivalent patient days. . . . 364,014 349,034 (4)
Net revenue per equivalent
patient day . . . . . . . . . $561 $552 (2)
Admissions . . . . . . . . . . 24,573 25,202 3
Average length of stay . . . . 13.2 12.2 (8)
<PAGE>
NINE MONTHS ENDED
------------------
JUNE 30 JUNE 30 %
1994 1995 CHANGE
------ ------ ------
*Number of psychiatric
hospitals . . . . . . . . . . 73 72 (1)
Average licensed beds. . . . . 6,688 6,588 (2)
Net revenue (in thousands) . . $594,399 $570,058 (4)
Patient days . . . . . . . . . 968,160 934,987 (3)
Equivalent patient days. . . . 1,065,676 1,041,936 (2)
Net revenue per equivalent
patient day . . . . . . . . . $558 $547 (2)
Admissions . . . . . . . . . . 70,314 75,054 7
Average length of stay . . . . 13.8 12.2 (12)
*The change in number of psych hospitals from 1994 to 1995 is due to the merger
of two facilities.
</TABLE>
Patient days at the Company's hospitals increased 39% and 35% for the
quarter and nine months ended June 30, 1995, respectively, as compared to the
same periods of fiscal 1994. These increases resulted primarily from patient
days attributable to the Acquired Hospitals. Patient days at the same store
hospitals decreased 4% and 3% for the quarter and nine months ended June 30,
1995 as compared to the same periods of fiscal 1994. These decreases resulted
primarily from declines in the average length of stay of 8% and 12% in the third
quarter and first nine months of fiscal 1995, respectively, as compared to the
prior year periods. Total admissions increased 36% and 37% for the quarter and
nine months ended June 30, 1995, respectively, as compared to the prior year
periods. These increases resulted primarily from admissions attributable to the
Acquired Hospitals. On a same store hospital basis, admissions increased by 3%
and 7% for the quarter and nine months ended June 30, 1995 as compared to the
prior year periods.
The Company's net revenue for the quarter and nine months ended June 30,
1995 increased 38% and 35%, respectively, as compared to the same periods in
fiscal 1994. The increases resulted primarily from acquisitions. Net revenue
for the quarter and nine months ended June 30, 1995 includes $1.4 million less
and $1.3 million more, respectively, than the same periods of the prior fiscal
year for the normal settlement of reimbursement issues and disproportionate
share payments. Net revenue per equivalent patient day at the Company's
psychiatric hospitals decreased in the quarter and nine months ended June 30,
1995 by 5%, as compared to the same periods in the prior
<PAGE>
year. The decreases were primarily due to lower net revenue per equivalent
patient day for the Acquired Hospitals compared to the Company's other hospitals
and from a continued shift in payor mix toward lower reimbursement programs such
as Medicare and Medicaid. Services to Medicare and Medicaid patients have
increased due to increased recognition and treatment of behavioral illnesses of
the elderly and disabled and, in some states, improved coverage of behavioral
services in psychiatric hospitals for Medicaid beneficiaries. The Company
believes that, at the same time, revenue from Blue Cross and commercial
insurance payors has declined because of a shift by purchasers of health
coverage to HMOs, PPOs, and other managed care plans that generally authorize
shorter lengths of stay than traditional insurance plans.
The Company's salaries, supplies and other operation expenses increased
43% and 39% in the third quarter and first nine months of fiscal 1995 compared
to fiscal 1994. These increases were primarily due to expenses incurred by the
Acquired Hospitals.
The Company's bad debt expense increased 58% and 46% in the quarter and
nine months ended June 30, 1995 as compared to the same periods in fiscal 1994.
These increases were primarily due to bad debt expenses at the Acquired
Hospitals. Bad debt expense as a percent of net revenue increased to 8.6% in
the third quarter of fiscal 1995 from 7.5% in the third quarter of fiscal 1994.
For the nine month periods, bad debt expense as a percent of net revenue
increased to 8.2% in the first nine months of fiscal 1995 from 7.6% in fiscal
1994. The Company anticipates future increases in bad debt expenses due to
increased deductibles and co-insurance and reduced annual and lifetime
psychiatric maximum payment limits for individual patients, which will result in
the Company not collecting full charges on an increasing number of patients.
Depreciation and amortization increased 46% in the third quarter of fiscal
1995 and 39% in the first nine months of fiscal 1995 as compared to the same
periods in fiscal 1994. The increases resulted primarily from depreciation
related to the Acquired Hospitals and other acquisitions and the amortization of
the related covenants not to compete and goodwill.
Reorganization value in excess of amounts allocable to identifiable assets
is being amortized over the three-year period ending July 1995.
Net interest expense for the third quarter and first nine months of fiscal
1995 increased 34% and 52%, respectively, from the previous fiscal year due to
the issuance of the 11.25% Senior Subordinated Notes (the "Notes") in May 1994
and to borrowings under the Revolving Credit Agreement used for acquisitions.
ESOP expense for the third quarter and first nine months of fiscal 1995
increased 15% and 11%, respectively, from the earlier periods. Unless the
Company decides to continue the ESOP, the expense will be less in fiscal 1996
than fiscal 1995.
Stock option expense for the third quarter and first nine months of fiscal
1995 decreased from the previous year due to fluctuations in the market price of
the Company's common stock.
In March 1995, the Company and a group of insurance carriers resolved
disputes that arose in fiscal 1995 related to claims paid predominantly in the
1980's. As part of the resolution, the Company will pay the insurance carriers
$29.8 million in five installments over a three year period. The Company and
the insurance carriers intend to continue to do business with each other and
maintain business at the same or similar general levels. No existing agreement,
contract, joint venture, or other business relationship in existence at the time
of the settlement will be terminated or affected as a result of the settlement.
Furthermore, the parties will negotiate in good faith concerning additional
business opportunities. Also, in the first quarter of fiscal 1995, the Company
recorded an unusual item of approximately $3 million which represented the pre-
tax gain on the sale of three psychiatric hospitals.
During the quarter ended June 30, 1994, the Company recorded an
extraordinary loss of approximately $12.6 million (net of income tax benefit of
approximately $8.4 million) related to the defeasance of the Company's 7.5%
Senior Subordinated Debentures due 2003 and the pay-off of certain subsidiary
mortgages. The extraordinary loss included the difference between the
redemption price and the carrying value of the debentures and prepayment
penalties related to such subsidiary mortgages.
<PAGE>
Management continually assesses events and changes in circumstances that
could effect its business strategy and the viability of its operating
facilities. During the quarter ended June 30, 1995, the Company closed four of
its psychiatric hospitals. During July 1995, the Company closed two additional
psychiatric hospitals. Management may elect to consolidate services in selected
markets and close or sell additional facilities in future periods depending on
market conditions and evolving business strategies.
Liquidity and Sources of Capital
During the first nine months of fiscal 1995, the Company incurred
approximately $73.6 million in capital expenditures, including $12.1 for routine
capital replacement and $61.5 million for acquisitions. The capital outlays
were financed from borrowings under the Revolving Credit Agreement, proceeds
from the issuance of the Notes and from cash provided by operations. The
Company anticipates that capital expenditures for fiscal 1995 relating to
existing hospitals will be approximately $20 million and will be financed from
cash provided by operations.
The number of days gross patient revenue in gross patients accounts
receivable was 62 days at June 30, 1995 and September 30, 1994.
<PAGE>
FORM 10-Q
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 6. - Exhibits and Reports on Form 8-K
(a) Exhibits
(3a) Bylaws of the Company, as amended, effective May 19, 1995
27 Financial Data Schedule
(b) Report on Form 8-K
There were no current reports on Form 8-K filed by the Registrant
with the Securities and Exchange Commission during the quarter
ended June 30, 1995.
<PAGE>
FORM 10-Q
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
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 thereunto duly authorized.
CHARTER MEDICAL CORPORATION
---------------------------
(Registrant)
Date: August 11, 1995 /s/ Lawrence W. Drinkard
----------------------- ---------------------------
Lawrence W. Drinkard
Executive Vice President - Finance
(Chief Financial Officer)
Date: August 11, 1995 /s/ John R. Day
----------------------- --------------------------------
John R. Day
Vice President and Controller
(Principal Accounting Officer)
<PAGE>
FORM 10-Q
CHARTER MEDICAL CORPORATION AND SUBSIDIARIES
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 thereunto duly authorized.
CHARTER MEDICAL CORPORATION
----------------------------------
(Registrant)
Date:------------------------- ----------------------------------
Lawrence W. Drinkard
Executive Vice President - Finance
(Chief Financial Officer)
Date: ------------------------- ----------------------------------
John R. Day
Vice President and Controller
(Principal Accounting Officer)
<PAGE>
BYLAWS
OF
CHARTER MEDICAL CORPORATION
As Amended 5/19/95
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS PAGE
<S> <C> <C>
ARTICLE I. OFFICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Registered Office . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Other Offices . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II. MEETINGS OF STOCKHOLDERS. . . . . . . . . . . . . . . . . . . . . 1
Section 1. Place of Meetings . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Date of Meetings. . . . . . . . . . . . . . . . . . . . . . . 1
Section 3. Notice of Meetings. . . . . . . . . . . . . . . . . . . . . . 2
Section 4. List of Stockholders. . . . . . . . . . . . . . . . . . . . . 2
Section 5. Special Meetings. . . . . . . . . . . . . . . . . . . . . . . 2
Section 6. Notice of Special Meetings. . . . . . . . . . . . . . . . . . 2
Section 7. Limitations on Special Meetings . . . . . . . . . . . . . . . 2
Section 8. Quorum and Adjournment. . . . . . . . . . . . . . . . . . . . 2
Section 9. Stockholder Action. . . . . . . . . . . . . . . . . . . . . . 3
Section 10. Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 11. Proxies and Voting Rights . . . . . . . . . . . . . . . . . . 3
Section 12. Action by Consent . . . . . . . . . . . . . . . . . . . . . . 3
Section 13. Inspectors of Elections . . . . . . . . . . . . . . . . . . . 4
Section 14. Presiding Officer . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III. DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1. Number, Election and Term of Office . . . . . . . . . . . . . 4
Section 2. Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3. Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 4. Powers of Directors . . . . . . . . . . . . . . . . . . . . . 5
Section 5. Place of Meetings . . . . . . . . . . . . . . . . . . . . . . 5
Section 6. Time of Meetings. . . . . . . . . . . . . . . . . . . . . . . 5
Section 7. Regular Meetings. . . . . . . . . . . . . . . . . . . . . . . 6
Section 8. Special Meetings. . . . . . . . . . . . . . . . . . . . . . . 6
Section 9. Quorum. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 10. Action by Consent . . . . . . . . . . . . . . . . . . . . . . 6
Section 11. Telephone Conference Call . . . . . . . . . . . . . . . . . . 6
Section 12. Executive and Other Committees. . . . . . . . . . . . . . . . 7
Section 13. Minutes of Committee Meetings . . . . . . . . . . . . . . . . 7
Section 14. Compensation. . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE IV. NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 1. Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2. Waiver and Consent. . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE V. OFFICERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2. Election of Officers. . . . . . . . . . . . . . . . . . . . . 9
Section 3. Additional Officers . . . . . . . . . . . . . . . . . . . . . 9
Section 4. Compensation. . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5. Tenure. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6. President - Powers and Duties . . . . . . . . . . . . . . . . 9
Section 7. President - Execution of Documents. . . . . . . . . . . . . . 9
<PAGE>
Section 8. Vice Presidents - Powers and Duties . . . . . . . . . . . . .10
Section 9. Secretary - Powers and Duties . . . . . . . . . . . . . . . .10
Section 10. Assistant Secretary . . . . . . . . . . . . . . . . . . . . .10
Section 11. Treasurer - Powers and Duties . . . . . . . . . . . . . . . .10
Section 12. Treasurer - Disbursements and Accounting. . . . . . . . . . .10
Section 13. Assistant Treasurer . . . . . . . . . . . . . . . . . . . . .11
Section 14. Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
ARTICLE VI. CERTIFICATES FOR SHARES OF STOCK . . . . . . . . . . . . . . . . .11
Section 1. Right to Certificate. . . . . . . . . . . . . . . . . . . . .11
Section 2. Classes of Stock - Rights . . . . . . . . . . . . . . . . . .11
Section 3. Officers' Signatures. . . . . . . . . . . . . . . . . . . . .12
Section 4. Lost Certificates . . . . . . . . . . . . . . . . . . . . . .12
Section 5. Transfer of Stock . . . . . . . . . . . . . . . . . . . . . .12
Section 6. Fixing of Record Date . . . . . . . . . . . . . . . . . . . .13
Section 7. Registered Stockholders . . . . . . . . . . . . . . . . . . .13
ARTICLE VII. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . .14
Section 1. Actions Not By Or In The Right
Of The Corporation. . . . . . . . . . . . . . . . . . . . . .14
Section 2. Actions By Or In The Right
Of The Corporation. . . . . . . . . . . . . . . . . . . . . .14
Section 3. Indemnification Where Director or Officer
Successfully Defends Action . . . . . . . . . . . . . . . . .15
Section 4. Determinations Required Prior
To Indemnification. . . . . . . . . . . . . . . . . . . . . .15
Section 5. Advances. . . . . . . . . . . . . . . . . . . . . . . . . . .15
Section 6. General . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Section 7. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . .16
Section 8. The Corporation . . . . . . . . . . . . . . . . . . . . . . .16
Section 9. Employee Benefit Plans. . . . . . . . . . . . . . . . . . . .16
Section 10. Continuation. . . . . . . . . . . . . . . . . . . . . . . . .16
Section 11. Future Amendments . . . . . . . . . . . . . . . . . . . . . .17
ARTICLE VIII. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . .17
Section 1. Dividends . . . . . . . . . . . . . . . . . . . . . . . . . .17
Section 2. Reserves. . . . . . . . . . . . . . . . . . . . . . . . . . .17
Section 3. Annual Statements . . . . . . . . . . . . . . . . . . . . . .17
Section 4. Checks. . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Section 5. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . .18
Section 6. Seal. . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Section 7. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . .18
ARTICLE IX. AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
</TABLE>
<PAGE>
BYLAWS
OF
CHARTER MEDICAL CORPORATION
ARTICLE I
OFFICES
Section 1. The registered office shall be in the City of Wilmington,
County of New Castle, State of Delaware.
Section 2. The corporation may also have offices at such other places both
within and without the State of Delaware as the board of directors may from time
to time determine or the business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of directors
shall be held in the City of Atlanta, State of Georgia, at such place as may be
fixed from time to time by the Board of Directors, or at such other place either
within or without the State of Delaware as shall be designated from time to time
by the Board of Directors and stated in the notice of the meeting. Meetings of
stockholders for any other purpose may be held at such time and place, within or
without the State of Delaware, as shall be stated in the notice of the meeting
or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of stockholders shall be held not later than
six months following the end of each fiscal year of the corporation on a date
and at a time as shall be designated from time to time by the Board of Directors
and stated in the notice of the meeting, at which the stockholders shall elect
members of the Board of Directors and transact such other business as may
properly be brought before the meeting. Election of directors need not be by
written ballot.
Section 3. Written notice of the annual meeting stating the place, date
and hour of the meeting shall be given to each stockholder entitled to vote at
such meeting not less than ten nor more than sixty days before the date of the
meeting.
<PAGE>
Section 4. The officer who has charge of the stock ledger of the
corporation shall prepare and make, or cause to be prepared and made, at least
ten days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in alphabetical order,
and showing the address of each stockholder and the number of shares registered
in the name of each stockholder. Such list shall be open to the examination of
any stockholder, for any purpose germane to the meeting, during ordinary
business hours, for a period of at least ten days prior to the meeting, either
at a place within the city where the meeting is to be held, which place shall be
specified in the notice of the meeting, or, if not so specified, at the place
where the meeting is to be held. The list shall also be produced and kept at
the time and place of the meeting during the whole time thereof, and may be
inspected by any stockholder who is present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called only by the affirmative vote of a majority of the
Board of Directors.
Section 6. Written notice of a special meeting stating the place, date and
hour of the meeting and the purpose or purposes for which the meeting is called,
shall be given not less than ten nor more than sixty days before the date of the
meeting, to each stockholder entitled to vote at such meeting.
Section 7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 8. The holders of a majority of the shares of all classes of stock
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business, except as otherwise provided by
statute or by the certificate of incorporation. If, however, such quorum shall
not be present or represented at any meeting of the stockholders, the
stockholders entitled to vote thereat, present in person or represented by
proxy, shall have power to adjourn the meeting from time to time, without notice
other than announcement at the meeting, until a quorum shall be present or
represented. At such adjourned meeting at which a quorum shall be present or
represented any business may be transacted which might have been transacted at
the meeting as originally notified. If the adjournment is for more than thirty
days, or if after the adjournment a new record date is fixed for the adjourned
meeting, a notice of the adjourned meeting shall be given to each stockholder of
record entitled to vote at the meeting.
<PAGE>
Section 9. Except as provided in Section 3 of Article III of these Bylaws,
or unless the question is one upon which, by express provision of statute or the
certificate of incorporation, a different vote is required, in which case such
express provision shall govern and control the decision of such question: (1)
in all matters other than the election of directors, the affirmative vote of the
majority of shares present in person or represented by proxy at the meeting and
entitled to vote on the subject matter shall be the act of the stockholders; (2)
directors shall be elected by a plurality of the votes of the shares present in
person or represented by proxy at the meeting and entitled to vote on the
election of directors; and (3) in voting on such questions, every stockholder of
record who is entitled to vote shall be entitled to one vote for each share of
stock held by him on the record date for such meeting.
Section 10. Except as otherwise provided by law or by the certificate of
incorporation, the holders of shares of all classes of stock shall have the
right to vote, in person or by proxy, together on all matters to come before a
meeting of the stockholders.
Section 11. No proxy shall be voted on after three years from its date,
unless the proxy provides for a longer period. A duly executed proxy shall be
irrevocable if it states that it is irrevocable and if, and only as long as, it
is coupled with an interest sufficient in law to support an irrevocable power.
A proxy may be made irrevocable regardless of whether the interest with which it
is coupled is an interest in the stock itself or an interest in the corporation
generally. In the event that any proxy shall designate two or more persons to
act as proxies, a majority of such persons present at the meeting, or if only
one be present that one, shall have all of the powers conferred by the proxy
upon all of the persons so designated unless the proxy shall otherwise provide.
Section 12. The stockholders may not take any actions required to be taken
at an annual or special meeting of the stockholders, or any actions which may be
taken at an annual meeting or special meeting of the stockholders, by written
consent in lieu of a meeting.
Section 13. The Board of Directors, in advance of any meeting of the
stockholders of the Corporation, shall appoint one or more inspectors of
elections to act at such meeting, and any adjournment thereof. In case any
person who has been designated as an inspector of elections fails to appear or
act, the vacancy may be filled by an alternate appointed by the Board, in
advance of the meeting, or at the meeting by the person presiding thereat. An
inspector, before entering upon discharge of his duties, shall take and sign an
oath faithfully to execute the duties of
<PAGE>
inspector with strict impartiality and according to the best of his ability.
The inspector or inspectors so appointed shall perform the duties required by
Section 231 of the Delaware General Corporation Law.
Section 14. The Chairman of the Board of Directors, or in his absence the
President, shall serve as Chairman of every stockholders' meeting unless some
other person is elected to serve as Chairman by a majority vote of the voting
power of the shares represented at the meeting. The Chairman shall appoint the
Secretary of the corporation, or in his absence an Assistant Secretary, as
Secretary of every stockholders' meeting and such other persons as he deems
required to assist with the meeting.
ARTICLE III
DIRECTORS
Section 1. The number of directors which shall constitute the whole Board
shall be eight. A change in the number of directors shall only occur by an
affirmative vote of at least seventy-five percent (75%) of the issued and
outstanding shares of the corporation entitled to vote thereon cast at a meeting
of the stockholders called for such purpose. The Board of Directors shall be
divided into three classes, as nearly equal in numbers as the then total number
of directors constituting the whole Board permits, with the term of office of
one class expiring each year. The directors shall be elected at the annual
meeting of the stockholders, except as provided in Sections 2 and 3 of this
Article, and each director elected shall hold office until his successor is
elected and qualifies. Directors need not be stockholders or a resident of the
State of Delaware.
Section 2. Any vacancies in the Board of Directors for any reason, and any
newly created directorships resulting from any increase in the authorized number
of directors, may be filled by a majority of the directors then in office,
though less than a quorum, or by a sole remaining director, and the directors so
chosen shall hold office until the next election of the respective class or
classes for which such directors shall have been chosen and until their
successors are duly elected and shall qualify, unless sooner displaced. If
there are no directors in office, then an election of directors may be held in
the manner provided by statute.
Section 3. Notwithstanding any other provision of these Bylaws (and
notwithstanding the fact that some lesser percentage may be specified by law),
any director or the entire Board of Directors of the corporation may be removed
from office at any time, but only (i) for cause by the affirmative vote of the
<PAGE>
holders of a majority of the issued and outstanding shares of the capital stock
of the corporation entitled to vote thereon cast at a meeting of the
stockholders called for that purpose, or (ii) without cause by the affirmative
vote of the holders of at least seventy-five percent (75%) of the issued and
outstanding shares of capital stock of the corporation entitled to vote thereon
cast at a meeting of the stockholders called for that purpose.
Section 4. The business of the corporation shall be managed by its Board
of Directors which may exercise all such powers of the corporation and do all
such lawful acts and things as are not by statute or by the certificate of
incorporation or by these Bylaws directed or required to be exercised or done by
the stockholders.
MEETINGS OF THE BOARD OF DIRECTORS
Section 5. The Board of Directors of the corporation may hold meetings,
both regular and special, either within or without the State of Delaware. The
Board of Directors shall appoint from its members a Chairman of the Board of
Directors who shall preside at all meetings of the stockholders and the Board of
Directors. In the absence of the Chairman of the Board of Directors from a
meeting of the Board of Directors, the Board of Directors shall appoint from its
members, by a majority vote of all directors constituting a quorum, another
director who shall preside at such meeting. The Chairman of the Board of
Directors may but need not be an officer of or employed in an executive or any
other capacity by the corporation.
Section 6. A meeting of the Board of Directors shall be held immediately
following the annual meeting of stockholders at the same place as such annual
meeting or, in the alternative, at such time and place as shall be fixed by the
vote of the stockholders at the annual meeting. No notice of such meeting shall
be necessary, provided a quorum shall be present. In the event such meeting is
not held at the time and place determined under the preceding sentence, the
meeting may be held at such time and place as shall be specified in a notice
given as hereinafter provided for special meetings of the Board of Directors, or
as shall be specified in a written waiver signed by all of the directors.
Section 7. Regular meetings of the Board of Directors may be held without
notice at such time and at such place as shall from time to time be determined
by the Board of Directors.
Section 8. Special meetings of the Board of Directors may be called by the
Chairman of the Board of Directors, the President, or a majority of the
directors then in office (a) by written notice mailed to each director first
class postage prepaid, not later than the fifth day before the meeting, or (b)
by either
<PAGE>
written or oral notice given personally or by telephone or other means of
electronic communication, in which case the meeting may be held as soon after
such notice is given as a quorum shall be assembled at the place of the meeting
or by telephone conference call, unless another time shall be specified in the
notice.
Section 9. At all meetings of the Board of Directors, a majority of the
directors then in office shall constitute a quorum for the transaction of
business and the act of a majority of the directors present at any meeting at
which there is a quorum shall be the act of the Board of Directors, except as
may be otherwise specifically provided by statute, by the certificate of
incorporation or by these Bylaws. If a quorum shall not be present at any
meeting of the Board of Directors, the directors present thereat may adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these Bylaws, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting, if all members of the Board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Board or committee.
Section 11. Unless otherwise restricted by the Certificate of
Incorporation or these Bylaws, members of the board of directors, or any
committee designated by the board of directors, may participate in a meeting of
the board of directors, or any committee, by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
COMMITTEES OF DIRECTORS
Section 12. The Board of Directors may, by resolution adopted by a
majority of the whole Board of Directors, appoint three or more of its members
to constitute an Executive Committee which to the extent provided by the Board
of Directors shall have and exercise all of the authority of the Board of
Directors, except as otherwise provided by law, in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it. All action taken
by the Executive Committee shall be reported to the Board of Directors at its
first meeting thereafter.
<PAGE>
The Board of Directors may also from time to time by resolution passed by a
majority of the whole Board appoint other committees, consisting of one or more
members, from among its members; and such committee or committees shall have
such powers and duties as the Board of Directors may from time to time
prescribe.
Unless otherwise provided by the Board of Directors, a majority of the
members of any committee appointed by the Board of Directors pursuant to this
Section 12 shall constitute a quorum at any meeting thereof and the act of a
majority of the members present at a meeting at which a quorum is present shall
be the act of such committee. Action may be taken by any such committee without
a meeting by a writing as provided in Section 10 of this Article III. Any such
committee shall, subject to any rules prescribed by the Board of Directors,
prescribe its own rules for calling, giving notice of and holding meetings and
its method of procedure at such meetings and shall keep a written record of all
action taken by it.
Section 13. Each committee shall keep regular minutes of its meetings and
periodically report the same to the Board of Directors.
COMPENSATION OF DIRECTORS
Section 14. The directors may be paid their expenses, if any, of
attendance at each meeting of the Board of Directors and may be paid a fixed sum
for attendance at each meeting of the Board of Directors or a stated salary as
director or a combination thereof. No such payment shall preclude any director
from serving the corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed like
compensation for attending committee meetings.
ARTICLE IV
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these Bylaws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, at his address as it appears on the records of the
corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to directors may also be given as provided in Section 8 of Article III.
<PAGE>
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
Bylaws, a waiver thereof in writing, signed by the person or persons entitled to
said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
Notice of all stockholders' meetings, whether annual or special, shall be
given in writing and may be given by the Chairman of the Board of Directors or
the Secretary (or in case of their refusal, by the person or persons entitled to
call meetings under the provisions of these Bylaws). The notice shall state the
general nature of the business to be transacted at the meeting and the place,
day and hour thereof. If such notice is mailed or telegraphed, it shall be
deemed to have been given when deposited in the United States mail or with a
telegraph office for transmission, as the case may be. If any meeting is
adjourned to another time or place, no notice as to such adjourned meeting or of
the business to be transacted thereat need be given other than by announcement
at the meeting at which such adjournment is given, except as otherwise expressly
provided in Section 8 of Article II.
ARTICLE V
OFFICERS
Section 1. The officers of the corporation shall be chosen by the Board of
Directors and shall be a President, a Vice President, a Secretary and a
Treasurer. The Board of Directors may also choose additional Vice Presidents,
and one or more Assistant Secretaries and Assistant Treasurers.
Section 2. The Board of Directors at its first meeting after each annual
meeting of stockholders shall choose a President, one or more Vice Presidents, a
Secretary and a Treasurer, or shall continue the incumbents in office.
Section 3. The Board of Directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the Board of Directors.
Section 4. The salaries of all officers and agents of the corporation
shall be fixed by the Board of Directors or by a duly authorized committee.
Section 5. Each officer of the Corporation shall hold office until the
earliest to occur of (a) his successor is elected and qualifies, (b) death or
retirement of such officer, (c)
<PAGE>
resignation of such officer or (d) removal of such officer in the manner
provided by these bylaws. Any officer elected or appointed by the Board of
Directors may be removed at any time by the affirmative vote of a majority of
the Board of Directors or, in the case of all officers except the President, by
the President. Any vacancy occurring in any office of the Corporation and all
newly created officer positions shall be filled by the Board of Directors.
PRESIDENT
Section 6. The President shall be and perform the duties and
responsibilities of the Chief Executive Officer of the corporation and as such
shall have general supervision and control over all the affairs of the
corporation, its officers and employees. The President may, but need not, be
designated the Chief Operating Officer of the corporation. The President shall
report to the Board of Directors regarding the affairs of the corporation and
shall have such other duties and powers as may be assigned to or vested in him
from time to time by the Board of Directors or by the Executive Committee and as
prescribed by these Bylaws.
Section 7. The President shall execute bonds, mortgages and other
contracts requiring a seal, under the seal of the corporation, except where
required or permitted by law to be otherwise signed and executed and except
where the signing and execution thereof shall be delegated by the Board of
Directors or the Executive Committee to some other officer or agent of the
corporation.
THE VICE PRESIDENTS
Section 8. The Vice President, or if there shall be more than one the Vice
Presidents, shall perform such duties and have such powers as the Board of
Directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARIES
Section 9. The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record or cause to be
recorded all the proceedings of the meetings of the corporation and of the Board
of Directors in a book to be kept for that purpose and shall perform like duties
for the standing committees when required. He shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors or Chairman of the Board of Directors, under whose supervision he
shall be. He shall have custody of the corporate seal of the corporation, and
he, or an Assistant Secretary, shall have authority to affix the same to any
<PAGE>
instrument requiring it; when so affixed, it may be attested by his signature or
by the signature of such Assistant Secretary. The Board of Directors may give
general authority to any other officer to affix the seal of the corporation and
to attest the affixing by his signature.
Section 10. The Assistant Secretary, or if there be more than one the
Assistant Secretaries in the order determined by the Board of Directors, shall,
in the absence or disability of the Secretary, perform the duties and exercise
the powers of the Secretary and shall perform such other duties and have such
other powers as the Board of Directors may from time to time prescribe.
THE TREASURER, CONTROLLER AND ASSISTANT TREASURERS
Section 11. The Treasurer shall have custody of the corporate funds and
securities, shall together with the Controller keep full and accurate accounts
of receipts and disbursements in books belonging to the corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the corporation in such depositories as may be designated by the Board of
Directors.
Section 12. The Treasurer and Controller shall disburse the funds of the
corporation as may be ordered by the Board of Directors, and shall render to the
Board of Directors, at its regular meetings, or when the Board of Directors so
requires, an account of the financial condition of the corporation.
Section 13. The Assistant Treasurer, or if there shall be more than one
the Assistant Treasurers in the order determined by the Board of Directors,
shall, in the absence or disability of the Treasurer, perform the duties and
exercise the powers of the Treasurer and shall perform such other duties and
have such other powers as the Board of Directors may from time to time
prescribe. Any one or more of the duties of the Treasurer may be delegated by
the Board of Directors to the Controller, an Assistant Treasurer or any other
officer of the corporation.
BONDS
Section 14. If required by the Board of Directors, any officer shall give
the corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for the faithful performance of the
duties of his office and for the restoration to the corporation, in case of his
death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the corporation.
<PAGE>
ARTICLE VI
CERTIFICATES FOR SHARES OF STOCK
Section 1. Every holder of stock in the corporation shall be entitled to
have a certificate, signed by, or in the name of the corporation, by the
Chairman of the Board of Directors, the President or a Vice President and the
Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary
of the corporation, certifying the number of shares of capital stock of the
corporation owned by him in the corporation.
Section 2. If the corporation shall be authorized to issue more than one
class of stock, or more than one series of any class, the powers, designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the corporation shall
issue to represent such class of stock; provided, however, that, except as
otherwise provided in Section 202 of the General Corporation Law of Delaware, in
lieu of the foregoing requirements there may be set forth on the face or back of
the certificate which the corporation shall issue to represent such class or
series of stock, a statement that the corporation will furnish without charge to
each stockholder who so requests, the powers, designations, preferences and
relative, participating, optional or other special rights of each class of stock
or series thereof and the qualifications, limitations or restrictions of such
preferences and/or rights.
Section 3. Where a certificate is signed (1) by a transfer agent or an
assistant transfer agent or (2) a registrar, the signature of any such officer
may be facsimile. In case any officer or officers who have signed, or whose
facsimile signature or signatures have been used on, any such certificate or
certificates shall cease to be such officer or officers of the corporation,
whether because of death, resignation or otherwise, before such certificate or
certificates have been delivered by the corporation, such certificate or
certificates may nevertheless be adopted by the corporation and be issued and
delivered as though the person or persons who signed such certificate or
certificates or whose facsimile signature or signatures have been used thereon
had not ceased to be such officer or officers of the corporation.
LOST CERTIFICATES
Section 4. The Board of Directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or destroyed,
upon the making of an
<PAGE>
affidavit of that fact by the person claiming the certificate of stock to be
lost or destroyed. When authorizing such issue of a new certificate or
certificates, the Board of Directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost or destroyed
certificate or certificates, or his legal representative, to advertise the same
in such manner as it shall require and/or to give the corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
corporation with respect to the certificate alleged to have been lost or
destroyed.
TRANSFERS OF STOCK
Section 5. Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, in each case with
signatures guaranteed, it shall be the duty of the corporation to issue a new
certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.
FIXING OF RECORD DATE
Section 6. The Board of Directors shall fix in advance a date, not less
than ten nor more than sixty days preceding the date of any meeting of
stockholders, or the date for the payment of any dividend, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
capital stock shall go into effect, or a date in connection with obtaining a
consent, as a record date for the determination of the stockholders entitled to
notice of, and to vote at, any such meeting, and any adjournment thereof, or
entitled to receive payment of any such dividend, or to any such allotment of
rights, or to exercise the rights in respect of any such change, conversion or
exchange of capital stock, or to give such consent, and in such case such
stockholders as shall be stockholders of record on the date so fixed shall be
entitled to such notice of, and to vote at, such meeting and any adjournment
thereof, or to receive payment of such dividend, or to receive such allotment of
rights, or to exercise such rights, or to give such consent, as the case may be,
notwithstanding any transfer of any stock on the books of the corporation after
any such record date fixed as aforesaid.
REGISTERED STOCKHOLDERS
Section 7. The corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered
<PAGE>
on its books as the owner of shares, and shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person, whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of Delaware.
ARTICLE VII
INDEMNIFICATION
Section 1. Actions Not By Or In The Right Of The Corporation. The
corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation) by reason of the fact that he
is or was a director, officer or employee of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
Section 2. Actions By Or In The Right Of The Corporation. The corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the right
of the corporation to procure a judgment in its favor by reason of the fact that
he is or was a director, officer or employee of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation and except that no
indemnification shall be made in
<PAGE>
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
Section 3. Indemnification Where Director or Officer Successfully Defends
Action. To the extent that a director, officer or employee of the corporation
has been successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Sections 1 and 2 of this Article VII, or in defense of
any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
Section 4. Determinations Required Prior To Indemnification.
Except as provided in Section 3 of this Article VII and except as may be ordered
by a court, any indemnification under Sections 1 and 2 of this Article VII shall
be made by the corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer or employee is
proper in the circumstances because he has met the applicable standard of
conduct set forth in Sections 1 and 2 of this Article VII, as the case may be.
Such determination shall be made (1) by a majority vote of the directors who
were not parties to such action, suit or proceeding, even though less than a
quorum; or (2) if there are no such directors, or if such directors so direct,
by independent legal counsel in a written opinion; or (3) by the stockholders.
Section 5. Advances. Expenses (including attorney's fees) incurred by an
officer or director in defending any civil, criminal, administrative, or
investigative action, suit or proceeding shall be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of the director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this Article. Such expenses
(including attorney's fees) incurred by other employees may be so paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate.
Section 6. General. The indemnification and advancement of expenses
provided by or granted pursuant to these Bylaws shall not be deemed exclusive of
any other rights to which those seeking indemnification or advancement of
expenses may be or shall become entitled under any agreement, vote of
stockholders or disinterested directors or otherwise, both as to actions in an
<PAGE>
official capacity and as to actions in another capacity while holding such
office.
Section 7. Insurance. The corporation may purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liabilities under the certificate of incorporation, the provisions of these
Bylaws or under the provisions of the General Corporation Law of the State of
Delaware.
Section 8. The Corporation. For purposes of this Article VII, references
to "the corporation" shall include, in addition to the resulting corporation,
any constituent corporation (including any constituent of a constituent)
absorbed in a consolidation or merger which, if its separate existence had
continued, would have had the power and authority to indemnify its directors,
officers and employees, so that any person who is or was a director, officer or
employee of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer or employee of another
corporation, partnership, joint venture, trust or other enterprise, shall stand
in the same position under the provisions of this Article VII with respect to
the resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
Section 9. Employee Benefit Plans. For purposes of this Article VII,
references to "other enterprises" shall include employee benefit plans; the
reference to "fines" shall include any excise taxes assessed on a person with
respect to an employee benefit plan; and references to "serving at the request
of the corporation" shall include any service as a director, officer, employee
or agent of the corporation which imposes duties on, or involves services by,
such director, officer or employee with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner he reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation" as referred to in
this Article VII.
Section 10. Continuation. The indemnification and advancement of expenses
provided by, or granted pursuant to, these Bylaws shall continue as to a person
who has ceased to be a
<PAGE>
director, officer or employee and shall inure to the benefit of the heirs,
executors and administrators of such a person.
Section 11. Future Amendments. In the event of any amendment or addition
to Section 145 of the General Corporation Law of the State of Delaware or the
addition of any other section of such law with regard to indemnification, the
corporation shall indemnify to the fullest extent authorized or permitted by
such then-existing General Corporation Law of the State of Delaware, as amended,
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of the corporation), by reason of the fact that he is or was a director,
officer or employee of the corporation or is or was serving at the request of
the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, or other enterprise against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding.
ARTICLE VIII
GENERAL PROVISIONS
Section 1. Dividends upon the capital stock of the corporation, subject to
the provisions of the certificate of incorporation, if any, may be declared by
the Board of Directors at any regular or special meeting, pursuant to law.
Dividends may be paid in cash, in property, or in shares of the capital stock,
subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
Board of Directors from time to time, in their absolute discretion, think proper
as a reserve or reserves to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the corporation, or for such other
purpose as the Board of Directors shall think conducive to the interest of the
corporation, and the Board of Directors may modify or abolish any such reserve
in the manner in which it was created.
ANNUAL STATEMENT
Section 3. The Board of Directors shall present at each annual meeting,
and at any special meeting, of the stockholders when called for by vote of the
stockholders a concise statement of the business and condition of the
corporation.
<PAGE>
CHECKS
Section 4. All checks or demands for money and notes of the corporation
shall be signed by such officer or officers or such other person or persons as
the Board of Directors may from time to time designate.
FISCAL YEAR
Section 5. The fiscal year of the corporation shall be determined by the
Board of Directors, and shall be from October 1 through September 30, unless
otherwise determined by the Board of Directors.
SEAL
Section 6. The corporate seal shall be in the form prescribed by the Board
of Directors. The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
MISCELLANEOUS
Section 7. Unless otherwise ordered by the Board of Directors, the
President, any Vice President, the Secretary, any Assistant Secretary or the
Treasurer in person or by proxy appointed by any of them shall have full power
and authority on behalf of the corporation to vote, act and consent with respect
to any shares of stock issued by other corporations which the corporation may
own or as to which the corporation has the right to vote, act or consent.
ARTICLE IX
AMENDMENTS
These Bylaws may be altered or repealed at any regular meeting of the
stockholders or of the Board of Directors or at any special meeting of the
stockholders or of the Board of Directors if such notice of such alteration or
repeal be contained in the notice of such special meeting. No Bylaw adopted by
vote of the stockholders shall be subject to amendment by the Board of Directors
if such Bylaw so provides. Notwithstanding the foregoing, neither Sections 5
nor 12 of Article II may be amended, altered, changed or repealed except by the
affirmative vote of the holders of at least seventy-five percent (75%) of the
issued and outstanding shares of capital stock of the Corporation entitled to
vote thereon cast at a meeting of the stockholders called for that purpose.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND CONSOLIDATED STATEMENTS OF OPERATIONS FOUND ON
PAGES 3 AND 4 OF THE COMPANY'S FORM 10-Q FOR THE YEAR-TO-DATE, AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-END> JUN-30-1995
<CASH> 67,459,000
<SECURITIES> 0
<RECEIVABLES> 212,944,000
<ALLOWANCES> 0
<INVENTORY> 6,526,000
<CURRENT-ASSETS> 301,670,000
<PP&E> 604,906,000
<DEPRECIATION> 83,425,000
<TOTAL-ASSETS> 1,005,549,000
<CURRENT-LIABILITIES> 208,868,000
<BONDS> 539,587,000
<COMMON> 7,099,000
0
0
<OTHER-SE> 76,032,000
<TOTAL-LIABILITY-AND-EQUITY> 1,005,549
<SALES> 868,403,000
<TOTAL-REVENUES> 868,403,000
<CGS> 0
<TOTAL-COSTS> 718,027,000
<OTHER-EXPENSES> 115,367,000
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<INTEREST-EXPENSE> 41,190,000
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