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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
December 18, 1998
Date of Report
(Earliest Reported
Event is December 10, 1998)
PHP HEALTHCARE CORPORATION
(Exact name of registrant as specified in its charter)
Commission File No. 0-16235
Delaware 54-1023168
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or jurisdiction)
11440 Commerce Park Drive
Reston, Virginia 20191
(Address of principal (Zip Code)
executive offices)
(703) 758-3600
Registrant's telephone number, including area code:
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(Former names or former address, if changed since last report)
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Item 5. Other Events
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As previously reported by PHP Healthcare Corporation (the "Company"), on
November 19, 1998, the Company filed in United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court"), Bankruptcy Case No. 98-2608(JJF),
a voluntary petition for relief under Chapter 11 of the United States Bankruptcy
Code. In accordance with its Chapter 11 reporting obligations, the Company filed
its Initial Reporting Requirements for All Chapter 11 Debtors (the "Initial
Report") with the Office of the U.S. Trustee on December 10, 1998. The documents
filed with the Initial Report included (i) the annual financial statements of
the Company for the fiscal year ended April 30, 1998; (ii) an unaudited balance
sheet of the Company dated as of September 30, 1998; (iii) an unaudited income
statement of the Company dated as of September 30, 1998; (iv) the most recently
filed State and Federal Payroll Tax Returns of the Company; (v) the most
recently filed Federal and State Income Tax Returns of the Company; (vi) the
State Sales Tax Return of the Company as of October 1998; (vii) proof of
establishment of Debtor-in-Possession bank accounts by the Company; and (viii)
proof of insurance by the Company. The items listed in paragraphs (i) through
(iii) above are attached with this Current Report on Form 8-K as Exhibit 99.1
On December 15, 1998, the Company and Ambulatory Healthcare Corporation of
America ("AHCA") signed a Preliminary Letter of Intent, dated December 7, 1998,
to develop a joint plan of reorganization for the Company which would provide
for a business combination of AHCA with the Company. On December 16, 1998, the
Company also disseminated the press release filed with this Current Report on
Form 8-K as Exhibit 99.2.
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Item 7. FINANCIAL STATEMENTS AND EXHIBITS
Exhibits. The following exhibits are furnished as part of this report:
Exhibit Description
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99.1 Annual financial statements of the Company for fiscal year
ended April 30, 1998, a balance sheet for the Company dated
as of September 30, 1998 and a statement of income of the
Company dated as of September 30, 1998 prepared by PHP
Healthcare Corporation.
99.2 Press Release, dated December 16, 1998, issued by PHP
Healthcare Corporation and Ambulatory Healthcare
Corporation of America
FORWARD LOOKING STATEMENTS
This Report contains forward-looking statements. The words, "believe",
"expect", and "anticipate" and similar expressions identify such
forwarding-looking statements. These forward-looking statements reflect the
Company's views with respect to future events and financial performance. Such
statements are subject to risks and uncertainties that could cause the Company's
actual results and financial position to differ materially from those projected
in the forward-looking statements. Risks associated with the Company's
forward-looking statements include, but are not limited to, those risk factors
described in the Company's Form 10-K under the caption "Business Risk Factors".
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates. The Company undertakes no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
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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 thereunto duly authorized.
PHP HEALTHCARE CORPORATION
By: /s/ Kenneth H. Weixel
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Name: Kenneth H. Weixel
Title: President and Chief Executive Officer
Dated: December 18, 1998
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PHP Healthcare Corp.
As of September 30, 1998
PHP Corp
Assets:
Cash (192,027)
Accounts receivables:
Billed 3,935,795
Unbilled 15,384,020
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Total accounts receivables 19,288,816
Income tax receivable 23,144
Pharmacy Inventory 380,964
Receivables from officers 7,313,756
Pre operation contract costs 20,060
Prepaids 2,414,161
Other current assets 319,282
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Total current assets 29,558,126
Fixed assets 25,121,537
Investment in subsidiaries 2,874,507
Goodwill, net of amortization 832,489
Deferred income taxes 11,280,583
Receivables from officers 534,297
Notes receivable 57,200,506
Other assets 4,137,396
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Total assets 131,120,451
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PHP Healthcare Corp.
As of September 30, 1998
PHP Corp
Liabilities:
Notes Payable - bank (S/T) 77,000,000
Notes Payable - others (S/T) 916,420
Accounts payable 7,056,829
Accrued salaries 7,626,551
Deferred revenue 360,929
Net PC payable (11,034,153)
Intercompany (51,708,669)
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Total current liabilities 30,218,007
Other LT liabilities 905,054
Note payable - other (L/T) 3,057,193
Deferred income taxes 350,586
Deferred gain 794,620
Convertible debt 66,762,724
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Total liabilities 102,088,164
Stockholders' equity:
Preferred stock 61,008,027
Common stock 173,879
APIC 58,170,488
Notes receivable - sale of stock (900,000)
Retained Earnings (BOY) (60,981,701)
Net (income)/loss (19,707,710)
Ending Retained Earnings (80,689,411)
Treasury stock-preferred 2,103,000
Treasury stock-common (11,833,695)
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Total stockholders' equity 29,032,268
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Total liabilities & s/e 131,120,451
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PHP Healthcare Corp.
As of September 30, 1998
PHP Corp
Revenues:
Chartered Health Plan 2,033,319
Other 35,183,190
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Total revenue 37,216,508
Direct Costs:
Chartered Health Plan 1,755,511
Other 32,401,616
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Total direct costs 34,157,127
G & A expenses 12,582,169
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Total operating expenses 46,739,296
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Operating (income) loss 9,522,788
Other (income) expense:
Interest expense 5,658,054
Interest income (2,051,287)
Miscellaneous (income) expense 111,104
M.I. earnings of subsidiaries -
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(Earnings) loss before taxes 13,240,659
Total income tax expense -
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Net (earnings) loss 13,240,659
Dividend on purchase of P/S 4,809,290
Deemed dividend expense 1,667,761
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Net (earnings) loss - C/S holders 19,707,710
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Exhibit 99.2
Contacts:
Ambulatory Healthcare Corporation
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Debra O' Connell
Vice President of Marketing
(703) 361-9731
PHP Healthcare Corporation
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Roy Winnick or Mark Semer
Kekst and Company
(212) 521-4842 or 4802
AMBULATORY HEALTHCARE CORPORATION OF AMERICA
AND PHP HEALTHCARE CORPORATION SIGN LETTER OF INTENT
MANASSAS and RESTON, VA., December 16, 1998 -- Ambulatory Healthcare Corporation
of America ("AHCA") and PHP Healthcare Corporation ("PHP") today announced that
they have signed a letter of intent to develop jointly a reorganization plan for
PHP under which AHCA and PHP would merge in a strategic business combination of
the two companies.
Financial, operational and other details of the contemplated reorganization plan
and merger are still being developed, and therefore such details cannot yet be
disclosed. The companies emphasized that any reorganization plan and merger
agreement they negotiate would be subject to due-diligence, financing and other
customary conditions, as well as approval of the creditors committee of PHP's
bankruptcy estate, the bankruptcy court, other regulatory agencies, and each
company's Board of Directors. They further emphasized that there can be no
assurance that the discussions currently under way will result in the
development and implementation of any reorganization plan or merger agreement
between AHCA and PHP.
As previously announced, PHP Healthcare Corporation and certain of its
subsidiaries, including Pinnacle Health Enterprises LLC, and PHP NJ MSO, on
November 19, 1998 filed voluntary petitions for protection under Chapter 11 of
the United States Bankruptcy Code. Also as previously announced, Pinnacle and
PHP NJ MSO subsequently converted their Chapter 11 cases to Chapter 7
liquidation on November 23, 1998.
(more)
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William P. Danielczyk, President and Chief Executive Officer of AHCA. said: "We
believe that certain of PHP's operations remain healthy and viable and, coupled
with our operations, can form the basis for a strong business. Having signed the
letter of intent, we will now work diligently and quickly to structure, with
representatives of PHP, a plan that would maximize value for the stakeholders of
both companies."
AHCA, a Delaware Corporation headquartered in Manassas, Virginia, operates
outpatient service delivery systems which include medical rehabilitation centers
and affiliated provider sides, home health agencies, ambulatory surgery centers,
and physician practices. AHCA was named one of the fastest-growing private
companies in the country by Inc. magazine, which released its annual ranking of
the Inc. 500 on October 14, 1998.
A medical management company, PHP Healthcare Corporation manages medical risk
through the acceptance of global capitation arrangements with HMOs and other
health care payors. The Company also offers a full range of management services
to the physician groups and hospitals that participate in provider-based
networks developed by PHP.
Except for historical information, the statements preceding are forward-looking
statements that involve risks and uncertainties. Investors are cautioned that
such statements are only predictions and the actual events or results may differ
materially. These forward-looking statements speak only as of this date. The
Company undertakes no obligation to publicly release the results of any
revisions to the forward-looking statements made today to reflect events or
circumstances after today, or to reflect the occurrence of unanticipated events.
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