<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 19, 1995
COMPREHENSIVE CARE CORPORATION
(Exact name of registrant as specified in Charter)
DELAWARE 0-5751 95-2594724
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
4350 VON KARMAN AVENUE, SUITE 280, NEWPORT BEACH, CALIFORNIA 92660
(Address of principal executive offices) (zip code)
(714) 798-0460
(Registrant's telephone number, including area code)
Exhibit Index on Page 3 of 4
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ITEM 5. OTHER EVENTS
On April 19, 1995, the Company announced that an accredited investor had
acquired, through private placement, 150,000 shares of restricted Common Stock
of the Company for $6.50 per share.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
Exhibit No. Description
- ----------- ------------
10.61 Common Stock Purchase Agreement dated April 15, 1995 between
the Company and James R. Moriarty, an individual, (filed
herewith).
99.5 Press release of the Company dated April 19, 1995 announcing
the private placement.
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EXHIBIT INDEX
Exhibit No. Description
- ----------- ------------
10.61 Common Stock Purchase Agreement dated April 15, 1995 between
the Company and James R. Moriarty, an individual, (filed
herewith).
99.5 Press Release of the Company dated April 19, 1995 announcing
the private placement.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
COMPREHENSIVE CARE CORPORATION
(Registrant)
By: /s/ Kerri Ruppert
----------------------------------
Kerri Ruppert, Vice President and
Chief Accounting Officer
(Principal Accounting Officer)
June 12, 1995
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EXHIBIT 10.61
COMPREHENSIVE CARE CORPORATION
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT ("Purchase Agreement") is made and
entered into as of this 15th day of April, 1995, by and among COMPREHENSIVE CARE
CORPORATION, a Delaware corporation (the "Company"), and the persons whose names
appear on the signature pages hereof (hereinafter collectively called the
"Purchasers").
R E C I T A L S:
A. The Company desires to obtain financing by issuance of its
authorized and previously unissued shares of the Company's Common Stock, par
value $.01 per share (the "Common Stock"); and
B. The Purchasers desire to acquire shares of the Common Stock
(such shares referred to herein individually as a "Share" and collectively as
the "Shares") on the terms and conditions set forth herein.
A G R E E M E N T:
NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATIONS, IT IS AGREED as
follows:
1. Issue of the Shares. Subject to the terms and conditions hereof, the
Company has authorized the issuance of an aggregate of 150,000 Shares to the
Purchasers (allocated as provided in Section 9 hereof) for a purchase price of
$6.50 in cash for each Share. The purchase price will be payable upon the
execution and delivery of this Purchase Agreement by wire transfer in same-day
or next-day funds as directed by the Company in writing.
2. Representations and Warranties of the Company. The Company
represents and warrants that:
2.1 The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware, and duly
qualified to do business and in good standing as a foreign corporation in the
State of California and each state in which the nature of its business or
properties requires such qualification (except where failure as to qualify would
not have a material adverse effect on the Company taken as a whole), with full
power and authority, corporate and otherwise, to enter into and perform this
Purchase Agreement, and to execute and deliver the various instruments and
documents provided for herein.
2.2 The execution, delivery and performance by the Company of
this Purchase Agreement, and the making, execution and delivery by the Company
of the instruments contemplated hereby, have been duly authorized by all
necessary corporate action and will not violate any provision of law, court
order or decree, or of its Certificate of Incorporation or
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Bylaws, or result in the breach of, or constitute a default under, or result in
the creation of any lien, charge or encumbrance upon any property or assets of
the Company pursuant to any agreement or instrument to which it is a party, or
by which it or its property may be bound or affected. This Purchase Agreement is
a valid and binding obligation of the Company, enforceable in accordance with
its terms.
2.3 Except as set forth in a Schedule attached hereto, (a)
there are no material lawsuits or proceedings pending, or, to the Company's
knowledge, threatened against or affecting the Company and (b) there are no
proceedings before any governmental commission, bureau or other administrative
agency pending, or, to the Company's knowledge, threatened against the Company.
2.4 The authorized capital of the Company is 12,500,000 shares
of Common Stock, $0.01 par value per share, of which approximately 2,314,529
were issued and outstanding as of February 28, 1995, and 60,000 shares of
Preferred Stock, $50.00 par value per share, of which no shares are issued and
outstanding. There are no shares of Common Stock reserved for issuance for
options, warrants or conversion of convertible securities, except as listed on a
Schedule hereto.
2.5 The Company's subsidiaries are as set forth in a Schedule
attached hereto.
2.6 The minute books of the Company have been properly kept and
reflect all transactions entered into by the Company which require submission to
or action by the stockholders or directors of the Company.
2.7 Any and all licenses and approvals required by the Company
for the conduct of its business have been obtained from the federal, state, or
local authorities concerned, all of which are in good standing.
2.8 The Shares of Common Stock issuable under this Purchase
Agreement have been duly authorized and, when issued against payment therefor,
will be validly issued, fully paid and nonassessable
2.9 Except for any applicable requirements of state securities
laws (as to which no representations or warranties are made), no governmental
permit, consent, approval or authorization is required in connection with (i)
the execution and delivery of this Purchase Agreement by the Company or (ii) the
offer, sale, issuance and delivery of the Notes contemplated hereby by the
Company; provided that, all representations made to the Company by the
Purchasers in this Purchase Agreement and in any other document or instrument
delivered in connection herewith are assumed for purposes of this representation
and warranty to be accurate and complete.
2.10 Included in the Company's Annual Report on Form 10-K for
the fiscal year ended May 31, 1994 are the consolidated balance sheets of the
Company at May 31, 1994 and May 31, 1993, and the consolidated statements of
operations, cash flows and stockholders' equity for the year ended May 31, 1994,
with the report thereon of Arthur Andersen & Co., independent accountants.
Included in the Company's Quarterly Reports on Form 10-Q for the quarters ended
August 31, 1994 and November 30, 1994 are the unaudited consolidated balance
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sheets of the Company as of such dates, the unaudited consolidated statements of
operations for the three-month periods ended on such dates and for the
corresponding prior year periods, and the unaudited consolidated statements of
cash flows for the three-month periods ended on such dates and for the
corresponding prior year periods.
2.11 None of the Company's reports and filings with the
Securities and Exchange Commission ("SEC") contained a misstatement of a
material fact or omitted to state a material fact necessary to make the
statements contained therein, in the light of the circumstances in which they
were made or omitted, not misleading.
2.12 The Company Common Stock is traded on The New York Stock
Exchange, Inc. ("NYSE"). No assurance is made as to any future NYSE listing of
Shares of Common Stock.
2.13 The proceeds received by the Company from the Shares will
be applied to general corporate purposes.
3. Representations of Each of the Purchasers. This Purchase Agreement
is made with Purchasers by the Company in reliance upon the Purchasers'
representations to the Company, which by Purchasers' acceptance hereof,
Purchasers confirm, severally and not jointly, except as indicated herein, that
(a) Purchasers are acquiring the Shares to be delivered for their own account
and not for the beneficial interest of any other person, and not with a view to
the distribution thereof, and that Purchasers will not distribute, sell or
otherwise dispose of the Shares except as permitted under the Securities Act of
1933, as amended (the "Act"), the General Rules and Regulations thereunder, and
all applicable State "Blue Sky" laws; (b) Purchasers have been afforded access
to information and have been informed fully concerning the Company, its
financial condition and business prospects; (c) Purchasers' financial
circumstances are such as to permit Purchasers to make this investment without
having a present intention or need to liquidate their investment and Purchasers
also severally acknowledge their awareness that their investment is subject to
substantial risk of loss; (d) Purchasers severally confirm further that they
have been advised that Shares have not been registered under the Act, and that,
accordingly, the Shares will be what is commonly known as "restricted
securities," and are not freely transferrable by the Purchasers except pursuant
to an exemption from registration under the Act, such as Rule 144, the substance
of which is known to the Purchasers; and (e) that substantially the following
legends shall be placed on the Shares:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
PURSUANT TO SECTION 4(2) OF SAID ACT OR REGULATION D THEREUNDER
AND NOT WITH A VIEW TO OR IN CONNECTION WITH THE DISTRIBUTION
THEREOF. THE SECURITIES MAY NOT BE OFFERED FOR SALE OR SOLD OR
OTHERWISE DISPOSED OF OR ENCUMBERED EXCEPT UPON COMPLIANCE WITH
SAID ACT AND AS PERMITTED BY THE PURCHASE AGREEMENT, A COPY OF
WHICH IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL OFFICE
OF THE COMPANY.
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4. Transfer by Each of the Purchasers. Neither the Shares to be
purchased by Purchasers, nor any interest therein, shall be sold, transferred,
assigned, or otherwise disposed of, unless the Company shall previously have
received an opinion of counsel knowledgeable in federal securities law, in form
and substance satisfactory to the Company and accompanied by such supporting
documents as the Company may reasonably request, to the effect that registration
under the Act is not required in connection with such disposition pursuant to
the Act or the General Rules and Regulations thereunder. The certificates
evidencing the Shares shall bear a conspicuous notation, substantially as
provided above, setting forth the restrictions on transfer herein set forth.
5. Registration.
5.1 (a) Incidental Registration. The Company will notify the
Purchasers of any proposed filing of a registration statement at least thirty
(30) days prior to each time that the Company proposes to file such registration
statement covering shares of its Common Stock other than (i) a registration
statement for the purpose of registering employees' stock options or plans or
employees' stock purchase or other such director or employee plans on Form S-8
or its equivalent, or (ii) a registration statement filed in connection with a
business combination, and will include in not more than two (2) such
registration statements any Shares issued to Purchasers which Purchasers request
to have so registered, by notifying the Company not later than ten (10) days
after the receipt by Purchasers of the Company's notice. If any Purchaser
requests such registration, all of the Purchasers shall be entitled to register
such number of their Shares at that time as they shall specify in writing to the
Company, subject to reduction on a pro rata basis if in the reasonable judgment
of the Company or its underwriter or investment banker the inclusion of more
shares could reasonably be expected to threaten the success of the registration.
(b) Demand Registration. If the Company has not
instituted registration procedures within the period ending forty-five (45) days
after the date of this Purchase Agreement and which afford the Purchasers an
opportunity to include their shares in such registration proceedings, the
Purchasers shall be entitled to demand a registration with the SEC of some or
all of their Shares. The demand must be made by the holders of not less than
one-half of the Shares originally issued under the Purchase Agreement. The
obligations of the Company and of the Purchasers in connection with any demand
registration shall be as set forth in Section 5.1(c) below.
(c) Terms of Registrations. The foregoing rights
and duties shall be subject to the following terms and conditions:
(i) The Company's duty to notify the
Purchasers and to include any Purchaser's Shares in any such
registration statement pursuant to an incidental registration under
Section 5.1(a) shall cease after any of the Purchasers' Common Stock
has been included in any two (2) effective registration statements,
including any pursuant to Section 5.1(b).
(ii) The Company shall bear the cost of any
registration statement and the incremental expense of including therein
any of the Purchasers' Shares pursuant to this Section 5.1, except that
the Purchasers shall bear the following expenses ratably applicable to
each Purchaser's Common Stock: any underwriting discount or
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brokerage commissions, SEC or NYSE or "Blue Sky" filing or similar
fees, securities transfer taxes, if applicable, and the Purchaser's own
legal expenses.
(iii) The Company will use its best efforts to
cause such registration statement to become effective under the Act;
provided, however, that if any securities being sold directly by the
Company are included in such registration statement, the Company may at
its discretion elect not to proceed with such registration statement or
to withdraw such registration statement after it has been filed but
before it becomes effective under the Act without regard to whether the
registration statement also includes any of the Purchasers' Shares. In
the event that any such registration is terminated by the Company prior
to effectiveness, such registration shall not be counted as one of the
two (2) registration statements under which a Purchaser is entitled to
include Shares hereunder.
(iv) If such registration statement relates to
an underwritten public offering of the Company's Common Stock for cash
and the underwriters or managing underwriters of such proposed offering
determine in good faith that the marketability of the underwritten
Company's Common Stock so requires, Purchasers' Common Stock which has
been included in the registration statement pursuant to this section
shall not be offered or sold to the public for such period up to sixty
(60) days from the effective date of the registration statement, as
such underwriters shall specify in writing. Nothing herein shall
require Purchasers to offer such securities through any such
underwriter.
5.2 The Company's obligations to Purchasers shall require it to
use its best efforts to cause any such registration statement to be prepared in
accordance with the Act and filed in an expeditious manner with due regard for
continuity of the ordinary and necessary business operations of the Company. In
connection with any requests pursuant to Section 5.1, the Company will (i) use
its best efforts to permit a lawful distribution by Purchasers in the manner
specified by Purchasers; (ii) use its best efforts to qualify or otherwise "blue
sky" the proposed offering by Purchasers in California, New York, Texas, and not
more than two (2) additional jurisdictions agreed upon by the holders of the
majority of the shares included in the registration statement; provided,
however, if such offering is underwritten by an underwriter, the Purchasers'
Shares shall also be "blue skied" in all states covered by the underwriting; and
provided, further, that nothing herein contained shall require the Company to
qualify as a foreign corporation in a jurisdiction in which it is not presently
qualified or to become licensed as a securities broker or dealer in any
jurisdiction; (iii) use its best efforts to obtain approval for listing the
shares included in the registration statement on the NYSE, or the other
principal exchange, or the principal trading market or quotation system upon
which shares of Company Common Stock are then traded; (iv) provide Purchasers
with a reasonable number of registration statements and prospectuses (including
amendments and revisions) requested by Purchasers; and (v) use its best efforts
to have such prospectuses meet the requirements of Section 10(a) of the
Securities Act of 1933, as amended. The Company shall use reasonable efforts to
cause any effective registration statement which includes Purchasers' Shares to
remain effective for a period of at least ninety (90) days. Provided, however,
in the event of a deferral in the inclusion of Purchasers' Shares, as provided
in Section 5.1(c)(iv), such minimum period of ninety (90) days shall be extended
by the period of such deferral.
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5.3 The Company's obligations under this Section 5 are
conditioned upon its being furnished by Purchasers with detailed descriptions of
Purchasers, their Shares to be covered in the requested registration statement,
their proposed method of distribution, and such other relevant information and
undertakings as may be required. If any Purchaser or Purchasers do not furnish
the requisite information, shares of such Purchasers need not be included in the
registration statement. However, this shall not affect the right of the other
Purchasers hereunder to have their Shares included within the registration
statement.
5.4 Anything herein to the contrary notwithstanding, if the
Company receives a request pursuant to Section 5.1 hereof and believes, in good
faith, that registration under the Act is not required in order to permit the
proposed sale or other disposition of such Shares covered by such request either
because it reasonably believes it can obtain a "no-action letter" from the SEC
permitting the proposed transactions without registration under the Act or it is
not required by reason of Rule 144(k) or otherwise, within ten (10) days after
receiving such request it will so notify Purchasers in writing and proceed
diligently with Purchasers' cooperation to seek to obtain such "no-action
letter" or opinion of counsel, as the case may be; provided, however, that if
such "no-action letter" or an opinion of counsel reasonably satisfactory in form
and substance to Purchasers and Purchasers' counsel (who must be knowledgeable
in federal securities law) is not obtained and submitted to Purchasers within
thirty (30) days from the date on which Purchaser made a request pursuant to
Section 5.1 hereof, the Company shall diligently proceed to comply with such
request in accordance with the terms hereof, without the imposition on
Purchasers of an incremental registration expense occasioned by such delay.
5.5 In connection with any registration statement pursuant to
this Section 5, Purchasers shall severally and not jointly indemnify and hold
harmless the Company and each person (if any) who controls the Company within
the meaning of Section 15 of the Act from and against all losses, claims,
damages and liabilities to which the Company or any of them may be subject,
actually or allegedly caused by any untrue or allegedly untrue statement of a
material fact contained in any such registration statement or related prospectus
or actually or allegedly caused by an omission to state therein a material fact
actually or allegedly required to be stated therein or necessary to make the
statements therein not misleading, which statement or omission shall have been
made in reliance upon and in conformity with written information furnished to
the Company by Purchasers on Purchasers' behalf specifically for use in
connection with such registration statement. Reciprocally, the Company hereby
agrees to indemnify and hold harmless Purchasers, any broker or other person who
may be deemed an underwriter for Purchasers and each person (if any) who
controls the Purchasers or Purchasers' underwriter within the meaning of Section
14 of the Act, from and against all losses, claims, damages and liabilities to
which such parties or any of them may be subject, actually or allegedly caused
by any untrue or allegedly untrue statement of a material fact contained in any
such registration statement or related prospectus or actually or allegedly
caused by any omission to state therein a material fact actually or allegedly
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such statement or omission shall have been made in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of Purchasers specifically for use in connection with
such registration statement.
(a) The foregoing indemnity shall include
reimbursements for any legal or other expenses incurred by the
indemnified party or any director, officer or controlling
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person, as defined above, in connection with investigating or defending
any such loss, damage, claim, liability or action.
(b) Promptly after receipt by an indemnified party
under this Section 5.5 of notice of commencement of any action, the
indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 5.5, notify the
indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it or him, as the case
may be, from any liability to any indemnified party otherwise than
under this Section 5.5 except to the extent that the failure to so
notify such party adversely affected the indemnifying party. In case
any such action is brought against any indemnified party and it or he
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the
extent desired, jointly, with any other indemnifying party similarly
notified, assume the defense and control the settlement thereof, with
counsel reasonably satisfactory to such indemnified party. After notice
from the indemnifying party to such indemnified party as to its or his
election so to assume the defense thereof, the indemnifying party will
not be liable to such indemnified party under this Section 5.5 for any
legal or other expenses subsequently incurred by such indemnified party
in connection with the defense thereof, other than reasonable cost of
investigation.
(c) The Company and the Purchasers each have the right
to make a reasonable investigation of the information contained in any
registration statement covered by this Section 5 to confirm its
accuracy, subject, however, to the obligation of each Purchaser to keep
in confidence any information derived until such time as the
information is filed with the SEC.
5.6 To the extent transfers of the Shares are permitted
pursuant to Section 4 hereof, the Purchasers may transfer, assign or otherwise
dispose of their rights under this Section 5, as a whole or in part, to one or
more parties; but no such action by the Purchasers shall increase or otherwise
affect the nature or extent of the Company's obligations provided in this
Section.
6. Hypothecation of Shares. The Company expressly agrees that any of
the Purchasers may pledge, assign or otherwise hypothecate any of the Shares
acquired hereby to any other Purchaser.
7. Choice of Law and Venue; Jury Trial Waiver
THE VALIDITY OF THIS PURCHASE AGREEMENT, ITS CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO WITH
RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED
UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS, WITHOUT GIVING EFFECT TO ITS CONFLICT OF LAWS PRINCIPLES. THE PARTIES
AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT
SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE
STATE OF TEXAS. THE COMPANY AND EACH PURCHASER WAIVES, TO THE EXTENT PERMITTED
UNDER APPLICABLE LAW, ANY RIGHT
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EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO
VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION.
THE COMPANY AND EACH PURCHASER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE
PURCHASE AGREEMENT OR THE NOTES OR ANY OF THE AGREEMENTS, DOCUMENTS, INSTRUMENTS
AND TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. THE COMPANY
AND EACH PURCHASER REPRESENTS FOR ITSELF THAT EACH HAS REVIEWED THIS WAIVER AND
EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A NON-JURY TRIAL BY THE COURT.
8. Governmental Authority. No consent, authorization, approval, or
other action by, and no notice to or filing with, any governmental authority or
regulatory body or any other Person is required for the execution, delivery or
performance of this Purchase Agreement, or the delivery and issuance of the
Shares, other than such actions as shall have been taken prior to the Closing.
9. Notices. Any notice or demand required or desired to be given to or
served upon the Company or the Purchasers in connection herewith shall be in
writing and deemed to have been sufficiently given or served for all purposes
when delivered in person or when deposited in the United States mail certified
or registered, postage prepaid, addressed or delivered as follows:
If to the Company: Comprehensive Care Corporation
c/o Chriss Street & Co.
1111 Bayside Drive, Suite 100
Corona del Mar, California 92629
Attention: Chriss W. Street, Chairman
If to the Purchasers: James R. Moriarty
c/o The Moriarty Law Firm
1111 Bagbe, Suite 1950
Houston, Texas 77002-2546
Number of
of Shares Purchased Purchasers:
150,000 James R. Moriarty, an individual
Total: 150,000
or, if any other address shall at any time be designated by the Company or by
the Purchaser in writing in conformance with the provisions hereof, to such
other address.
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10. Parties in Interest. All the terms and provisions of this Purchase
Agreement shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns, other than purchasers of Shares sold to the
public pursuant to Section 5 hereof.
11. Section and Other Headings. Section and other headings herein are
for reference purposes only, and shall not be used in any way to govern, limit,
modify, construe or otherwise affect this Purchase Agreement.
12. Counterparts. This Purchase Agreement may be executed with each
Purchaser in one or more counterparts, each of which shall be deemed an
original, but all of which together shall be deemed but one and the same
instrument.
13. Attorneys' Fees. In the event of any suit or action arising out of
an Event of Default under this Purchase Agreement, the Purchasers shall be
entitled to reasonable attorneys' fees and costs of suit.
IN WITNESS WHEREOF, the undersigned have caused this Purchase Agreement
to be executed by the undersigned persons thereunto duly authorized.
"Company"
COMPREHENSIVE CARE CORPORATION
By: /s/ Chriss W. Street
--------------------------------------------
Chriss W. Street, Chairman of the Board,
Chief Executive Officer and President
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"Purchasers"
/s/ James R. Moriarty
--------------------------------
James R. Moriarty, an individual
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SCHEDULE 2.3
TO
COMMON STOCK PURCHASE AGREEMENT
Pending or Threatened
Litigation or Governmental Proceedings
INCORPORATED BY REFERENCE TO RELEVANT DISCLOSURE IN THE
COMPREHENSIVE CARE CORPORATION
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED NOVEMBER 30, 1994
IN THE FORM AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
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SCHEDULE 2.4
TO
COMMON STOCK PURCHASE AGREEMENT
<TABLE>
<CAPTION>
POST RECLASS.
REVERSE SPLIT
PRE RECLASS. (1 FOR 10)
------------ -------------
<S> <C> <C>
Shareholders' (Common Stock Purchase) Rights Plan 21,986,916(2) 2,314,529(3)
Incentive Stock Option Plan(1) 1,487,666 400,000*
Non Statutory Stock Option Plan(1) 360,000 200,000*
Options not within a Plan 1,500,000 150,000
Afield Option 100,000 10,000
Directors' Stock Plan N/A 200,000**
Secured Convertible Notes N/A 333,333
due January 1997
Shares issuable on Conversion of
Convertible Subordinated Debentures (approx.) 335,000 33,500(4)
</TABLE>
- ---------------
(1) Less exercised options.
(2) Had exceeded the total number of authorized and unissued shares or treasury
shares of Common Stock that were available for issuance under the
Shareholders' Rights Plan.
(3) Includes 100,000 shares issued to Lindner Investments, Inc. in February
1995.
(4) Excludes an estimated maximum of 150,000 shares issuable upon future
exchange as proposed under the March 3, 1995 letter agreement between the
Company and a representative of debentureholders. Also excludes an estimated
200,000 shares issuable for the acquisition by AccessCare, Inc. of American
Mental Healthcare, Inc.
* Reflects the 1-for-10 reverse stock split effected in October 1994. Share
certificates representing old common stock not yet surrendered have been
included as the number of shares of Common Stock into which converted by the
reverse stock split without adjustment for the effect of payment in lieu of
fractional shares, which is believed by the Company to have an insubstantial
effect on the number of outstanding shares.
** Implemented after the 1-for-10 reverse stock split by the adoption of such
plan by majority vote of the stockholders present or represented at the 1994
Annual Meeting of Stockholders.
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SCHEDULE 2.5
TO
COMMON STOCK PURCHASE AGREEMENT
Subsidiaries
<TABLE>
<CAPTION>
% STOCK OWNED STATE OF INCORP.
------------------ ---------------------
<S> <C> <C>
CareManor Hospital of Washington, Inc. 100% Washington
Trinity Oaks Hospital, Inc. 100% Texas
Starting Point, Inc. 100% California
CareInstitute (Non-Profit) 100% California
CareUnit Clinic of Washington, Inc. 100% Washington
CareUnit Hospital of Ohio, Inc. 100% Ohio
CareUnit, Inc. 100%(7) Delaware
AccessCare, Inc. 86.5%(8) Nevada
Newport Point, Inc.(1)(4) 80% Delaware
Access Managed Care, Inc.(2) 100% Ohio
Managed Behavioral HealthCare, Inc.(1)(3) 100% Florida
N.P.H.S., Inc.(2) 100% California
NeuroAffiliates Company(2)(6) 100% California
CareUnit, Inc.(1) 100% California
Comprehensive Care Corporation(1) 100% Nevada
CareUnit Hospital of St. Louis, Inc.(1) 100% Missouri
CareUnit Hospital of Albuquerque, Inc.(1) 100% New Mexico
CareUnit Hospital of Nevada, Inc.(1) 100% Nevada
CareUnit of Chicago, Inc.(1) 100% Illinois
GVHC, Inc.(1) 50% Minnesota
CMP Properties, Inc.(1) 100% Oregon
CompCare Health Services, Ltd.(1) 100% Canada
AccessCare of Washington, Inc.(2)(5) 100% Washington
CareUnit of Florida, Inc.(2) 100% Florida
</TABLE>
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(1) Inactive and in the process of dissolution.
(2) Inactive.
(3) Formerly known as Mental Health Programs, Inc.
(4) Stock interest held by Starting Point, Inc.
(5) Stock interest held by AccessCare, Inc.
(6) Unincorporated. N.P.H.S. holds this interest.
(7) The Company has agreed to pledge these shares to secure its performance of
the letter agreement dated March 3, 1995 between the Company and a
representative of debentureholders, which requires that the Company offer
up to approximately $4,775,000 in cash, plus $1,150,000 in shares of Common
Stock, plus $765,000 in cash in lieu of interest, to exchanging
debentureholders, assuming the tender of all of the outstanding debentures.
(8) Reflects anticipated purchase by Physician Corporation of America of shares
of preferred stock, which is subject to execution of definitive agreements
and various conditions.
<PAGE> 1
Exhibit 99.5
NEWS RELEASE
COMPREHENSIVE CARE CORPORATION ANNOUNCES
PRIVATE EQUITY PLACEMENT
NEWPORT BEACH CALIFORNIA, April 19, 1995: Drew Q. Miller, chief operating
officer of Comprehensive Care Corporation (NYSE: CMP) today reported that an
accredited investor has acquired, through private placement, 150,000 shares of
restricted Common Stock of the Company at $6.50 per share.
Comprehensive Care Corporation manages, through contract relationships, the
delivery of healthcare for specific "disease states" throughout the United
States.
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