<PAGE> 1
As filed with the Securities and Exchange Commission on February 7, 1997
Registration No. 333-__________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
OPTIMUMCARE CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 33-0218003
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
30011 IVY GLENN DRIVE, SUITE 219 EDWARD A. JOHNSON, PRESIDENT
LAGUNA NIGUEL, CALIFORNIA 92677 OPTIMUMCARE CORPORATION
(714) 495-1100 30011 IVY GLENN DRIVE, SUITE 219
(ADDRESS, INCLUDING ZIP CODE AND LAGUNA NIGUEL, CALIFORNIA 92677
TELEPHONE NUMBER, INCLUDING AREA (714) 495-1100
CODE, OF (NAME ADDRESS, INCLUDING ZIP CODE,
REGISTRANT'S PRINCIPAL EXECUTIVE AND
OFFICES) TELEPHONE NUMBER, INCLUDING AREA
CODE
OF AGENT FOR SERVICE)
COPIES TO:
RICHARD H. BRUCK, ESQ.
KAREN NICOLAI WINNETT, ESQ.
BRUCK & PERRY, A PROFESSIONAL CORPORATION
ONE NEWPORT PLACE, TENTH FLOOR
NEWPORT BEACH, CALIFORNIA 92660
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO
THE PUBLIC: AS SOON AS PRACTICABLE AFTER THIS REGISTRATION
STATEMENT BECOMES EFFECTIVE.
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933 check the following box. [X]
If the registrant elects to deliver its latest annual report to
security holders or a complete and legible facsimile thereof, pursuant to Item
11(a)(1) of this Form, check the following box. [X]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=====================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT
AMOUNT OFFERING AGGREGATE OF
TITLE OF EACH CLASS OF TO BE PRICE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED SHARE PRICE FEE
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMON STOCK, $.001 PAR VALUE 36,000 $ .65 $ 23,400.00 $ 8.07
(1).....................................
- -----------------------------------------------------------------------------------------------------
COMMON STOCK, $.001 PAR VALUE 48,193 $ .83 $ 40,000.19 $ 13.79
(2).....................................
- -----------------------------------------------------------------------------------------------------
TOTAL............................................................................ $ 100.00
=====================================================================================================
</TABLE>
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF
1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS
THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
================================================================================
- ------------------------
(1) Shares registered for issuance to Sunrise Financial Group, Inc. for
financial public relations services.
(2) Shares registered for issuance to Schwab, Bennett & Associates for mental
health delivery system consulting services.
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED ON FEBRUARY 7, 1997
PROSPECTUS
84,193 SHARES
OPTIMUMCARE CORPORATION
COMMON STOCK
This Prospectus relates to (i) 36,000 shares of common stock, $.001 par
value, ("Common Stock") of the Company to be issued to Sunrise Financial Group,
Inc. for financial public relations services and (ii) up to 48,193 shares of the
Common Stock of the Company which may be issued to Schwab, Bennett & Associates
for mental health delivery system consulting services under a letter agreement
dated May 15, 1995.
This Prospectus is accompanied by a copy of the Company's latest Form
10-K and Form 10-Q, as amended.
No underwriting discounts, commissions, finders' fees or brokers'
commissions will be paid by the Company in connection with issuances of shares
of Common Stock under this Prospectus.
The Company's Common Stock is quoted on the over the counter ("OTC")
Bulletin Board under the symbol "OPMC." The high bid and low bid of the
Company's Common Stock on February 6, 1997 were $1.75 and $1.66, respectively.
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK
AND IMMEDIATE SUBSTANTIAL DILUTION. SEE "RISK FACTORS."
------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1997.
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Public
Reference Section of the Commission at Room 1024, 450 Fifth Street, N.W.
Washington, D.C. 20549, and at the following Regional Offices of the Commission:
New York Regional Office, 7 World Trade Center, 13th Floor, New York, New York
10048; and Chicago Regional Office, Northwestern Atrium Center, Suite 1400, 500
West Madison, Chicago, Illinois 60661. Copies of such material can also be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W. Washington, D.C. 20549.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed with the Commission by the Company (File No.
0-17401) are incorporated into this Prospectus by reference: (1) the Company's
Annual Report on Form 10-K/A, as amended, for the year ended December 31, 1995;
(2) the Company's Quarterly Reports on Forms 10-Q/A, as amended, for the
quarters ended March 31, 1996, June 30, 1996 and September 30, 1996; and (3) all
other reports filed by the Company pursuant to Sections 13 or 15(d) of the
Exchange Act since September 30, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering hereunder shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing
such documents. Any statement contained herein or in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. COPIES OF THESE DOCUMENTS (OTHER THAN
EXHIBITS THERETO) ARE AVAILABLE WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST BY
A PERSON TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED, FROM OPTIMUMCARE
CORPORATION, 30011 IVY GLENN DRIVE, SUITE 219, LAGUNA NIGUEL, CALIFORNIA 92677;
TELEPHONE NUMBER (714) 495-1100. IN ORDER TO ENSURE TIMELY DELIVERY OF THE
DOCUMENTS, ANY REQUEST SHOULD BE MADE AT LEAST FIVE BUSINESS DAYS PRIOR TO THE
DATE ON WHICH A FINAL INVESTMENT DECISION IS TO BE MADE.
THE COMPANY
OptimumCare Corporation (the "Company") was incorporated in California on
November 25, 1986 and was reincorporated in Delaware on June 29, 1987. In
mid-1987, the Company commenced the development and marketing of health care
facility-based programs ("Programs") to be managed by the Company for the
treatment of depression and certain other mental health disorders
("PsychPrograms"), as well as programs for alcohol and drug abuse ("Treatment
Programs"). The Company contracts to establish Programs at a host health care
facility and recruits and trains the staff needed to operate the Programs
including a medical director, a program director, a psychologist, a chief
therapist and one or more counselors or social workers. The host health care
facility provides a specified number of beds for the Program, as well as all
other support services required for the operation of the Program, including
nursing, dietary, housekeeping, billing and other administrative functions.
As of January 24, 1997, the Company has 12 Programs that are hosted by
four hospitals and one community mental health center: Five PsychPrograms at
Huntington InterCommunity Hospital, D/B/A Humana Hospital Huntington Beach,
Huntington Beach, California; two PsychPrograms at St. Francis Medical Center,
Lynwood, California; two PsychPrograms through Sherman Oaks Hospital and
HealthCenter, Sherman Oaks, California; two PsychPrograms at Mission Community
Hospital, San Fernando, California; and one PsychProgram at Friendship Community
Mental Health Center, Phoenix, Arizona.
2
<PAGE> 4
A twenty percent (20%) stock dividend was declared by the Board of
Directors of the Company on August 14, 1996 for all stockholders of record on
October 1, 1996. The stock dividend was issued on October 18, 1996. The Board of
Directors declared the stock dividend based on the Company's anticipated current
year earnings. The Company has accounted for the dividend by transferring from
current year earnings and accumulated deficit to common stock and
paid-in-capital an amount equal to the fair value of the stock distributed as a
dividend as of the date the dividend was declared.
The Company's executive offices are located at 30011 Ivy Glenn Drive,
Suite 219, Laguna Niguel, California 92677; telephone number (714) 495-1100.
3
<PAGE> 5
SELECTED FINANCIAL DATA
The following summary financial information should be read in conjunction
with the Financial Statements and Notes thereto of the Company and with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," included in the Company's Annual Report on Form 10-K/A, as amended,
for the year ended December 31, 1995 (the "1995 Form 10-K") incorporated by
reference herein and the unaudited Quarterly Report on Form 10-Q/A, as amended,
for the nine months ended September 30, 1996. The data at December 31, 1995,
December 31, 1994 and for each of the three fiscal years in the period ended
December 31, 1995 are derived from the Company's Financial Statements for such
years which have been audited by Ernst & Young LLP, independent auditors. The
financial data as of September 30, 1996 and for the nine months then ended and
for the nine months ended September 30, 1995 are derived from unaudited
financial statements. The unaudited financial statements include all
adjustments, consisting of normal recurring accruals, which the Company
considers necessary for a fair presentation of the financial position and the
results of operations for these periods. Operating results for the nine months
ended September 30, 1996 are not necessarily indicative of the results that may
be expected for the entire year ending December 31, 1996.
On October 18, 1996, the Company issued a dividend of two-tenths (.2)
share for each share of the Company's Common Stock held by stockholders of
record on October 1, 1996. Per share information and weighted number of shares
outstanding for all periods presented have been retroactively restated to
reflect the stock dividend.
OPERATIONS DATA:
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30 YEARS ENDED DECEMBER 31,
----------------------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
NET REVENUES $7,937,101 $4,513,760 $6,027,122 $5,596,283 $3,825,613 $2,314,376 $2,222,220
NET INCOME (LOSS)
664,698 302,950 2,070 465,045 365,189 127,045 183,037
NET INCOME (LOSS)
PER SHARE OF
COMMON STOCK
.10 .05 .00 .07 .06 .02 .03
WEIGHTED NUMBER
OF SHARES
OUTSTANDING 6,449,485 6,357,390 6,414,709 6,218,113 5,939,264 5,886,611 5,866,211
</TABLE>
BALANCE SHEET DATA:
<TABLE>
<CAPTION>
AS OF AS OF DECEMBER 31,
SEPTEMBER 30, -----------------------------------------------------------------
1996 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
TOTAL ASSETS $3,382,891 $2,059,537 $1,814,153 $1,299,215 $917,779 $659,369
CURRENT ASSETS 2,934,012 1,739,112 1,699,801 1,237,885 904,072 639,857
CURRENT LIABILITIES 688,451 381,531 333,209 269,343 249,701 118,336
NET WORKING CAPITAL 2,245,561 1,357,581 1,366,592 968,542 654,371 521,521
LONG-TERM
OBLIGATIONS 243,334 166,000 0 0 0 0
</TABLE>
4
<PAGE> 6
RISK FACTORS
INVESTMENT IN THE COMPANY IS HIGHLY SPECULATIVE AND INVOLVES A HIGH DEGREE OF
RISK. PRIOR TO THE PURCHASE OF ANY SHARES, A PROSPECTIVE INVESTOR SHOULD
CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS, AS WELL AS OTHER INFORMATION
CONTAINED IN THIS PROSPECTUS, INCLUDING THE FINANCIAL STATEMENTS AND NOTES
THERETO CONTAINED IN THE 1995 FORM 10-K/A.
Competition. The Company competes with other health care management
companies for contracts with acute care hospitals. Also, the Company's Programs
will compete for patients with the programs of other hospitals and other health
care providers and facilities operators. The success of the Company's Programs
is also dependent on its ability to establish relationships with sources of
patient referrals.
The Company's principal competitors include Charter Medical Corporation,
Community Psychiatric Centers, Comprehensive Care Corporation, Mental Health
Management and Horizon Health Services, all of which have greater financial and
other resources and more experience than the Company. In addition, some health
maintenance organizations ("HMOs") offer competing programs. HMOs typically do
not provide programs for partial hospitalization or substance abuse, but often
provide coverage for these programs, usually at a reduced rate.
Other health care facilities offer comparable programs which compete with
the Company's Programs in each service area. The Company believes, however, that
in general its marketing efforts are primarily effective within a ten (10) mile
radius around the host hospital and that patients outside such radius are not
directly affected by such advertising unless their personal physician has
admitting privileges and recommends the Company's program at that host hospital.
Dependence on a Few Customers; Risk of Termination of Contracts. As of
January 24, 1997, the Company has 12 Programs operating through four hospitals
and one community mental health center. If any of these Programs were
terminated, or if any of the accounts receivable from these contracts were to
become uncollectible, any such event could have a material adverse effect on the
Company. The Company's Programs at some of the hospitals are terminable on 90
days notice and also on various conditions if a certain patient census is not
maintained. Therefore, there can be no assurance that any of the existing
contracts will remain in force through their specified terms.
Dependence on Key Personnel. The Company is greatly dependent on the
services of Edward A. Johnson, its Chief Executive Officer and Chairman of the
Board. The loss of Mr. Johnson could have a material adverse effect on the
operations of the Company. The Company owns "key-man" life insurance on the
life of Mr. Johnson in the amount of $1,000,000.
Government Regulation. The health care industry is extensively
regulated by federal, state and local governments. Regulations which affect the
Company relate to controlling the growth of health care facilities, requiring
licensure of the host health care facility, requiring certification of the
Program at the host facility and controlling reimbursement for health care
services. Licensure of facilities and certification of Programs are state
requirements, while certification for Medicare is a federal requirement.
Compliance with the licensure and certification requirements is monitored by
annual on-site inspections by representatives of the licensing agencies. Loss of
licensure or Medicare certification by a host facility could result in
termination of such contract.
Certificate of need ("CON") laws in some states require approval for
capital expenditures in excess of certain threshold amounts, expansion of bed
capacity or facilities, acquisition of medical equipment or institution of new
services. If a CON must be obtained, it may take up to 12 months to do so, and
in some instances longer, depending upon the state involved and whether the
application is contested by a competitor or the state agency. CON's usually are
issued for a specified maximum expenditure and require implementation of the
proposed improvement within a specified period of time. Certain states,
including California, Texas, Utah, Colorado and Arizona, have enacted
legislation repealing CON requirements for the construction of new health care
facilities, the expansion of existing facilities and the institution of new
services. Some states have enacted or have under
5
<PAGE> 7
legislative consideration "sunset" provisions which require the review,
modification or deletion of these statutes when no longer needed. The Company is
unable to predict whether such legislative proposals will be enacted but
believes that the elimination of CON requirements positively impacts its
business.
The Joint Commission on the Accreditation of Healthcare Organizations
("JCAHO"), at a facility's request, will participate in the periodic surveys
which are conducted by state and local health agencies to ensure continuous
compliance with all licensing requirements by health care facilities. JCAHO
accreditation satisfies certain of the certification requirements for
participation in the Medicare and Medicaid programs. A facility found
substantially to comply with JCAHO standards receives accreditation. A patient's
choice of a treatment facility may be affected by JCAHO accreditation
considerations because most third-party payers limit coverage to services
provided by an accredited facility. All of the hospitals currently under
contract with the Company have received JCAHO accreditation.
The laws of various states in which the Company may choose to operate,
including California, generally prevent corporations from engaging in the
practice of medicine. These laws (e.g., Section 2052 of the California Business
and Professions Code), as well as applicable case law, were enacted to protect
the public from the rendering of unnecessary medical or other services for
treatment of the ill. Although the Company has not obtained a legal opinion, it
believes that the establishment and operation of Programs will not cause it to
be engaged in the "practice of medicine" as that term is used in such laws and
regulations. These laws and regulations are subject to interpretation and,
accordingly, the issue is not free from doubt. Since the Company has not sought
or obtained any rulings, there can be no assurance that state authorities or
courts will not determine that the Company is engaged in the unauthorized
practice of medicine. If such a determination is made and is not overturned, the
Company would have to terminate its operations in that state.
The Company's medical directors are engaged to provide administrative
services, including but not limited to planning the clinical program,
supervising the clinical staff, establishing standards of professional care,
advising the Company and staff on questions of policy. The co-medical
directors conduct public relations activities and assist the Company in
marketing. Although the Company has not obtained a legal opinion, it believes
that the proposed agreements between the Company and its medical and co-medical
directors do not violate any fee-sharing prohibitions. The federal prohibition,
as it relates to the Medicare program, is found at 42 U.S.C. 1320a-7b. Such
prohibitions are found in Section 650 of the California Business and
Professional Code and Section 445 of the California Health and Safety Code, as
well as comparable statutes in other states. However, future judicial,
legislative or administrative interpretations of these arrangements could
prohibit the Company from hiring professionals which could have a materially
adverse effect on the Company.
HealthCare Reforms; Payment for Service. Given the recent political
mandate for health care reform, it appears likely that health care cost
containment will occur. Currently proposed legislation does not directly require
any modifications to the Company's operations. Although there is a trend to
reduce hospitalization and associated costs which could negatively impact the
Company's in-patient programs, the Company believes that its average patient
stay is already consistent with cost containment goals. Any negative impact on
in-patient programs which may occur may be offset by an increase in the
utilization of the Company's partial hospitalization and out-patient programs.
Although the Company is experienced in administrating "managed care type"
programs and is familiar with the pressures of improving productivity and
reducing costs, pending and future reforms may have an adverse impact on the
Company's revenues.
Pending legislative proposals revising Medicare/Medicaid reimbursement, if
enacted, could have a negative affect on the revenues of the hospitals with
which the Company contracts. Generally, the Company's agreements with hospitals
require the Company and the hospital to renegotiate rates in the event of a
significant legislative change which affects the compensation received by the
hospital. It is uncertain at this time to what extent the Company's revenues may
be impacted by the proposed legislation.
In addition, government efforts to eliminate the exemption from Medicare's
prospective payment system for long-term care hospitals currently exist. These
proposals would affect the cash flow of the facilities the Company intends to
contract with through its 70% owned subsidiary, OptimumCare Source, LLC. This
could also result in
6
<PAGE> 8
renegotiation of the rates the OptimumCare Source, LLC receives for its services
and the timing of payments. The Company does not anticipate that OptimumCare
Source, LLC will generate revenues from the facilities with which it contracts
which are significant to the Company on a consolidated basis until after
approximately six full months of operations.
The Company anticipates that additional legislation may be adopted
focusing on controlling health care costs and improving access to medical
services for persons who are uninsured. Such legislation may also affect the
amount which health care providers can charge for services. The Company believes
that it is well positioned to respond to these changes and than it is likely
that the Company will experience a lesser impact that other companies in the
health care industry based on the fact that the Company has already focused its
efforts on shortening patient stays and has historically provided a greater
percentage of its services to Medicaid patients than have many of its
competitors.
No Cash Dividends. The Company does not anticipate the payment of cash
dividends on its Common Stock in the foreseeable future. On October 18, 1996,
the Company issued a dividend of two-tenths (.2) share for each share of the
Company's Common Stock held by stockholders of record on October 1, 1996. See
"Price Range of Common Stock and Dividend Policy."
DESCRIPTION OF COMMON STOCK
The Company is authorized to issue 20,000,000 shares of Common Stock,
$.001 par value, of which, as of January 17, 1997, approximately 6,736,210
shares were issued and outstanding and held of record by 205 persons. The
Company believes that there are approximately 900 beneficial owners of its
Common Stock. This includes shares issued by the Company on October 18, 1996, as
dividend of two-tenths (.2) share for each share of the Company's Common Stock
held by stockholders of record on October 1, 1996.
Holders of shares of Common Stock are entitled to one vote per share on
all matters to be voted upon by the stockholders generally. The approval of
proposals submitted to stockholders at a meeting other than for the election of
directors requires the favorable vote of a majority of the shares voting, except
in the case of certain fundamental matters (such as certain amendments to the
Certificate of Incorporation, and certain mergers and reorganizations), in which
cases Delaware law and the Company's Bylaws require the favorable vote of at
least a majority of all outstanding shares. Stockholders are entitled to receive
such dividends as may be declared from time to time by the Board of Directors
out of funds legally available therefor, and in the event of liquidation,
dissolution or winding up of the Company to share ratably in all assets
remaining after payment of liabilities. The holders of shares of Common Stock
have no preemptive, conversion or subscription rights. All Shares of Common
Stock sold in this offering will be, when issued, fully paid and nonassessable.
7
<PAGE> 9
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
The Company's common stock is currently quoted on the over the counter
"OTC" Bulletin Board under the symbol "OPMC". The following table sets forth,
for each of the calendar quarters indicated, the reported high and low bid
prices per share of the Common Stock of the Company. The high and low bid
information represents inter-dealer quotations, without retail mark-up, markdown
or commissions and may not necessarily represent actual transactions.
High Bid Low Bid
-------- -------
1996:
- ----
Third Quarter 1-7/16 23/32
Second Quarter 1-1/4 29/32
First Quarter 1-7/32 7/8
1995:
- ----
Fourth Quarter 1-1/4 1-5/16
Third Quarter 1-1/4 29/32
Second Quarter 1-7/32 21/32
First Quarter 7/8 3/4
1994:
- ----
Fourth Quarter 7/8 3/4
On October 18, 1996, the Company issued a dividend of two-tenths (.2)
share for each share of the Company's Common Stock held by stockholders of
record on October 1, 1996. The Company has never paid or declared cash dividends
on its Common Stock. The Company does not anticipate the payment of cash
dividends on its Common Stock in the foreseeable future.
The Transfer Agent for the Company's Common Stock is American Stock
Transfer & Trust Company, New York, New York.
8
<PAGE> 10
LIMITATION OF LIABILITY OF DIRECTORS
AND INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Delaware General Corporation Law provides that corporations may
include a provision in their certificate of incorporation relieving directors of
monetary liability for breach of their fiduciary duty as directors, provided
that such provision shall not eliminate or limit the liability of a director (i)
for any breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for unlawful payment
of a dividend or unlawful stock purchase or redemption, or (iv) for any
transaction from which the director derived an improper personal benefit. The
Company's Certificate of Incorporation provides that the Company's directors are
not liable to the Company or its stockholders for monetary damages for breach of
their fiduciary duty as directors to the fullest extent permitted by Delaware
law. In addition to the foregoing, the Company's Bylaws provide that the Company
may indemnify directors, officers, employees or agents to the fullest extent
permitted by law.
The above provisions in the Certificate of Incorporation and Bylaws may
have the effect of reducing the likelihood of derivative litigation against
directors and may discourage or deter stockholders or management from bringing a
lawsuit against directors for breach of their fiduciary duty, even though such
an action, if successful, might otherwise have benefitted the Company and its
stockholders. However, the Company believes the foregoing provisions are
necessary to attract and retain qualified persons as directors.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable.
RESTRICTIONS ON RESALE
This Prospectus may not be used for reoffers or resales of shares of
Common Stock acquired pursuant to this Prospectus by "affiliates" of businesses
or properties acquired by the Company or a subsidiary of the Company (generally,
directors, officers and other controlling persons). These "affiliates" may only
offer or sell such shares pursuant to a registration statement under the
Securities Act of 1933 covering the shares or in compliance with an available
exemption from these registration requirements, such as Rule 145 under the Act.
LEGAL MATTERS
The law firm of Bruck & Perry, A Professional Corporation, Newport Beach,
California, has acted as counsel for the Company in connection with this
offering and has rendered its opinion to the Company on the legality of the
securities covered by this Prospectus.
EXPERTS
The financial statements and financial statement schedule of the Company
appearing in the Company's Annual Report (Form 10-K/A), as amended, for the year
ended December 31, 1995, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and incorporated
herein by reference. The financial statements referred to above are included in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
9
<PAGE> 11
================================================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING HEREIN CONTAINED, AND IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO BUY
ANY SECURITY OTHER THAN THE REGISTERED SECURITIES TO WHICH IT RELATES, OR AN
OFFER TO OR SOLICITATION OF ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER
OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE, CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE FACTS HEREIN SET FORTH SINCE THE DATE HEREOF.
---------------------------
TABLE OF CONTENTS
Item Page
- ---- ----
Available Information..........................................................2
Documents Incorporated
by Reference.............................................................2
The Company....................................................................2
Selected Financial Data........................................................4
Risk Factors...................................................................5
Description of Common Stock....................................................7
Price Range of Common Stock
and Dividend Policy......................................................8
Limitation of Liability of
Directors and Indemnification
of Directors and Officers................................................9
Restrictions on Resale.........................................................9
Legal Matters..................................................................9
Experts........................................................................9
================================================================================
================================================================================
84,193 SHARES
OPTIMUMCARE CORPORATION
----------
PROSPECTUS
----------
_______, 1997
================================================================================
<PAGE> 12
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the offering are as follows:
<TABLE>
<CAPTION>
ITEM AMOUNT*
---- -------
<S> <C>
Securities and Exchange Commission Registration Fee............... $ 100.00
Accounting Fees and Expenses...................................... 5,000.00*
Legal Fees and Expenses........................................... 10,000.00*
Printing, Design and Advertising.................................. 100.00*
Miscellaneous.....................................................
300.00*
----------
TOTAL........................................................ $15,500.00*
==========
</TABLE>
- -------------------------
*Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
DELAWARE STATUTES
Section 145 of the Delaware General Corporation Law, as amended, provides
for the indemnification of the Company's officers, directors, employees and
agents under certain circumstances as follows:
(a) A corporation may 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, 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 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.
(b) A corporation may 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, 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 expenses (including attorneys' fees)
actually and reasonably incurred by him in Cnnection 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 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.
II-1
<PAGE> 13
(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
section, 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.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in subsections (a) and (b) of this
section. Such determination shall be made (1) by a majority vote of the
directors who are 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.
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may 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 such 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 section. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the board of directors deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
(g) A corporation shall have power to 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 liability under this section.
(h) For purposes of this section, 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 power and
authority to indemnify its directors, officers, and employees or agents, so that
any person who is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under this section with respect to the resulting or surviving
corporation as he would have with respect to such constituent corporation if its
separate existence had continued.
(i) For purposes of this section, references to "other enterprises" shall
include employee benefit plans; references to "fines" shall include any excise
taxes assessed on a person with respect to any 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, employee, or
agent 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
section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
II-2
<PAGE> 14
(k) The Court of Chancery is hereby vested with exclusive jurisdiction to
hear and determine all actions for advancement of expenses or indemnification
brought under this section or under any bylaw, agreement, vote of stockholders
or disinterested directors, or otherwise. The Court of chancery may summarily
determine a corporation's obligation to advance expenses (including attorneys'
fees) (Last amended by Ch.261,L.'94, eff.7-1-94.)
ARTICLES OF INCORPORATION
The Company's Certificate of Incorporation provides for the
indemnification of the Company's directors under certain circumstances as
follows:
To the fullest extent permitted by the Delaware General Corporation Law as
the same exists or may hereafter be amended, a director of this
corporation shall not be liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director.
BYLAWS
The Company's Bylaws provide for the indemnification of the Company's
directors, officers, employees, or agents under certain circumstances as
follows:
7.1 Authorization For Indemnification. The Corporation shall indemnify, in
the manner and to the full extent permitted by law, any person (or the estate,
heirs, executors, or administrators of any person) who was or is a party to, or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether or not by or in the right of the Corporation, and
whether civil, criminal, administrative, investigative or otherwise, by reason
of the fact that such person 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, or employee 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. 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, that he had reasonable cause to believe that his conduct was
unlawful.
7.2 Advance of Expenses. Costs and expenses (including attorneys' fees)
incurred by or on behalf of a director, officer, employee or agent in defending
or investigating any action, suit, proceeding or investigation shall be paid by
the Corporation in advance of the final disposition of such matter, if such
director, officer, employee or agent shall undertake in writing to repay any
such advances in the event that it is ultimately determined that he is not
entitled to indemnification. Notwithstanding the foregoing, no advance shall be
made by the Corporation if a determination is reasonably and promptly made by
the Board by a majority vote of a quorum of disinterested directors, or (if such
a quorum is not obtainable or, even if obtainable, a quorum of disinterested
directors so directs) by independent legal counsel, that, based upon the facts
known to the Board or counsel at the time such determination is made, (a) the
director, officer, employee or agent acted in bad faith or deliberately breached
his duty to the Corporation or its stockholders, and (b) as a result of such
actions by the director, officer, employee or agent, it is more likely than not
that it will ultimately be determined that such director, officer, employee or
agent is not entitled to indemnification.
7.3 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 or as a member of any committee or similar
body 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 liability under the
provisions of this Article or applicable law.
II-3
<PAGE> 15
7.4 Non-exclusivity. The right of indemnity and advancement of expenses
provided herein shall not be deemed exclusive of any other rights to which any
person seeking indemnification or advancement of expenses from the Corporation
may be entitled under any agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office. Any agreement for
indemnification of or advancement of expenses to any director, officer, employee
or other person may provide rights of indemnification or advancement of expenses
which are broader or otherwise different from those set forth herein.
ITEM 16. EXHIBITS.
Exhibit
Number Description
------ -----------
3.2 Bylaws incorporated by reference from Form S-18 Registration Statement
(Registration No. 33-16313-LA) filed July 28, 1988, Exhibit 3.2.
3.4 Restated Certificate of Incorporation filed October 3, 1989,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1989, Exhibit 3.4.
5.1 Opinion of Bruck & Perry regarding legality of shares.
10.1 Lease between the Company and Laguna Niguel Office Center dated June 23,
1988 which supersedes lease dated December 15, 1986, incorporated by
reference from Form S-18 Registration Statement (Registration No. 33-
16313-LA) filed July 28, 1988, Exhibit 10.1.
10.6 Amended and Restated 1987 Stock Option Plan incorporated by reference
from Form S-18 Registration Statement (Registration No. 33-16313-LA)
filed July 28, 1988, Exhibit 10.6.
10.18 Form of Modification Agreement to Incentive Stock Option Agreement,
dated January 20, 1988, incorporated by reference from Form S-18
Registration Statement (Registration No. 33-16313-LA) filed July 28,
1988, Exhibit 10.18.
10.30 Lease amendment between the Company and Laguna Niguel Office Center
dated September 24, 1990 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1990, Exhibit 10.30.
10.34 Agreement between Huntington Intercommunity Hospital and the Company
dated November 5, 1991, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1991, Exhibit 10.34.
10.38 Agreement between Huntington Intercommunity Hospital and the Company
dated October 1, 1992, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1992, Exhibit 10.38.
10.39 Agreement between Brotman Medical Center and the Company dated October
20, 1992, incorporated by reference from Annual Report on Form 10-K for
the year ended December 31, 1992, Exhibit 10.39.
10.43 Lease amendment between the Company and Laguna Niguel Office Center
dated May 12, 1993 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1993, Exhibit 10.43.
10.48 Lease agreement between Columbia Healthcare Corporation and the Company
dated October 18, 1993, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1993, Exhibit 10.48.
II-4
<PAGE> 16
10.52 Lease agreement between Whittier Narrows Business Park and the Company
dated January 10, 1994, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1994, Exhibit 10.52.
10.55 1994 Stock Option Plan dated March 22, 1994, incorporated by reference
from Annual Report on Form 10-K for the year ended December 31, 1994,
Exhibit 10.55.
10.56 Lease Agreement between Frank T. Howard and the Company dated May 4,
1994, incorporated by reference from Annual Report on Form 10-K for the
year ended December 31, 1994, Exhibit 10.56.
10.60 Lease amendment between the Company and Laguna Niguel Office Center
dated July 7, 1994, incorporated by reference from Annual Report on Form
10-K for the year ended December 31, 1994, Exhibit 10.60.
10.62 Agreement between Queen of the Angels - Hollywood Presbyterian Medical
Center, Inc. and the Company dated December 6, 1994, incorporated by
reference from Annual Report on Form 10-K for the year ended December
31, 1994, Exhibit 10.62.
10.64 Unanimous written consent dated December 30, 1994 of the Board of
Directors amending the Promissory Note between the Company and Edward A.
Johnson dated December 10, 1993, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1994, Exhibit 10.64.
10.66 Agreement between Sherman Oaks Hospital and Health Center dated March
30, 1995, incorporated by reference from Annual Report on Form 10-K for
the year ended December 31, 1995, Exhibit 10.66.
10.67 Loan Agreement between the Company and National Bank of Southern
California dated March 31, 1995, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1995, Exhibit 10.67.
10.68 Lease Agreement between the Company and Laguna Niguel Office Center
dated June 5, 1995 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1995, Exhibit 10.68.
10.69 Sublease Agreements between the Company and Huntington Beach Hospital
and Medical Center dated July 1, 1995, incorporated by reference from
Annual Report on Form 10-K for the year ended December 31, 1995, Exhibit
10.69.
10.70 Lease Agreement between the Company and 757 Pacific Partnership dated
July 3, 1995, incorporated by reference from Annual Report on Form 10-K
for the year ended December 31, 1995, Exhibit 10.70.
10.71 Sublease Agreement between the Company and Huntington Beach Hospital and
Medical Center dated July 24, 1995, incorporated by reference from
Annual Report on Form 10-K for the year ended December 31, 1995, Exhibit
10.71.
10.72 Lease Agreement between the Company and Columbia Healthcare Corporation
dated September 14, 1995 which supersedes lease dated October 18, 1993,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1995, Exhibit 10.72.
10.73 Agreement between San Fernando Community Hospital, Inc., dba Mission
Community Hospital and the Company dated October 6, 1995, incorporated
by reference from Annual Report on Form 10-K for the year ended December
31, 1995, Exhibit 10.73.
10.74 Lease Agreement between the Company and Solomon, Saltsman & Jameson
dated October 10, 1995, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1995, Exhibit 10.74.
II-5
<PAGE> 17
10.75 Unanimous Written Consent dated December 29, 1995 of the Board of
Directors amending the promissory note between the Company and Edward A.
Johnson dated December 30, 1994, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1995, Exhibit 10.75.
10.77 Operating Agreement for Optimum Care Source, LLC, incorporated by
reference from Quarterly Report on Form 10-Q for the quarter ended March
31, 1996, Exhibit 10.77.
10.78 Master Joint Venture Agreement between Professional Care Source, Inc.
and the Company dated April 19, 1996, incorporated by reference from
Quarterly Report on Form 10-Q for the quarter ended March 31, 1996,
Exhibit 10.78.
10.79 Employment Agreement between Margaret M. Minnick and Optimum Care
Source, LLC, incorporated by reference from Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, Exhibit 10.79.
10.80 Employment Agreement between Teri L. Jolin and Optimum Care Source, LLC,
incorporated by reference from Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996, Exhibit 10.80.
10.81 Employment Agreement between Joseph H. Dadourian and Optimum Care
Source, LLC, incorporated by reference from Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, Exhibit 10.81.
10.82 Registration Agreement between Professional Care Source, Inc. and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.82.
10.83 Non-Qualified Stock Option Agreement between Joseph H. Dadourian and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.83.
10.84 Non-Qualified Stock Option Agreement between Teri L. Jolin and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.84.
10.85 Non-Qualified Stock Option Agreement between Margaret M. Minnick and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.85.
10.86 Agreement between Friendship Community Mental Health Center and the
Company dated April 25, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.86.
10.87 Letter agreement dated May 15, 1995 between Schwab, Bennett & Associates
and the Company.
10.88 Letter agreement dated June 14, 1995 between Sunrise Financial Group,
Inc. and the Company.
24.1 Consent of Bruck & Perry.
24.2 Consent of Ernst & Young LLP.
II-6
<PAGE> 18
ITEM 17. UNDERTAKINGS.
A. The undersigned registrant hereby undertakes to file during any
period in which offers or sales of the securities are being made, a
post-effective amendment to this registration statement: (i) to include any
prospectus required by Section 10(a)(3) of the Securities Act of 1933, (ii) to
reflect any facts or events arising after the effective date of the registration
statement (or most recent post-effective amendment) which, individually or in
the aggregate, represent a fundamental change in the information set forth in
the registration statement, and (iii) to include any material information with
respect to the plan of distribution not previously disclosed or any material
change to such information set forth in the registration statement. The
undersigned registrant further undertakes that, for the purpose of determining
any liability under the Securities Act of 1933, each post-effective amendment
shall be deemed to be a new registration statement relating to the securities
offered therein and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof. The undersigned registrant further
undertakes to remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
B. The undersigned registrant hereby undertakes that for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the new offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
C. The undersigned registrant hereby undertakes to deliver or cause to
be delivered with the Prospectus, to each person to whom the Prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 of Rule 14c-3 under the Securities Exchange Act of
1934; and where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the Prospectus, to deliver or
cause to be delivered to each person to whom the Prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the Prospectus to provide such interim financial information.
D. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-7
<PAGE> 19
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form S-2 and has authorized this registration
statement to be signed on its behalf by the undersigned, in the City of Laguna
Niguel, State of California on February 2, 1997.
OPTIMUMCARE CORPORATION
By: /s/ EDWARD A. JOHNSON
----------------------------
Edward A. Johnson, President
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.
Signature/Title Date
- --------------- ----
/s/ EDWARD A. JOHNSON February 2, 1997
- ----------------------------------------------------
EDWARD A. JOHNSON, President,
Principal Financial Officer,
Principal Accounting Officer and Director
/s/ MICHAEL S. CALLISON February 3, 1997
- ----------------------------------------------------
MICHAEL S. CALLISON, Director
/s/ GARY L. DREHER February 3, 1997
- ----------------------------------------------------
GARY L. DREHER, Director
/s/ JON E. JENETT February 2, 1997
- ----------------------------------------------------
JON E. JENETT, Director
II-8
<PAGE> 20
EXHIBIT INDEX
-------------
Exhibit
Number Description
- ------ -----------
3.2 Bylaws incorporated by reference from Form S-18 Registration Statement
(Registration No. 33-16313-LA) filed July 28, 1988, Exhibit 3.2.
3.4 Restated Certificate of Incorporation filed October 3, 1989,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1989, Exhibit 3.4.
5.1 Opinion of Bruck & Perry regarding legality of shares.
10.1 Lease between the Company and Laguna Niguel Office Center dated June 23,
1988 which supersedes lease dated December 15, 1986, incorporated by
reference from Form S-18 Registration Statement (Registration No. 33-
16313-LA) filed July 28, 1988, Exhibit 10.1.
10.6 Amended and Restated 1987 Stock Option Plan incorporated by reference
from Form S-18 Registration Statement (Registration No. 33-16313-LA)
filed July 28, 1988, Exhibit 10.6.
10.18 Form of Modification Agreement to Incentive Stock Option Agreement,
dated January 20, 1988, incorporated by reference from Form S-18
Registration Statement (Registration No. 33-16313-LA) filed July 28,
1988, Exhibit 10.18.
10.30 Lease amendment between the Company and Laguna Niguel Office Center
dated September 24, 1990 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1990, Exhibit 10.30.
10.34 Agreement between Huntington Intercommunity Hospital and the Company
dated November 5, 1991, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1991, Exhibit 10.34.
10.38 Agreement between Huntington Intercommunity Hospital and the Company
dated October 1, 1992, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1992, Exhibit 10.38.
10.39 Agreement between Brotman Medical Center and the Company dated October
20, 1992, incorporated by reference from Annual Report on Form 10-K for
the year ended December 31, 1992, Exhibit 10.39.
10.43 Lease amendment between the Company and Laguna Niguel Office Center
dated May 12, 1993 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1993, Exhibit 10.43.
10.48 Lease agreement between Columbia Healthcare Corporation and the Company
dated October 18, 1993, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1993, Exhibit 10.48.
<PAGE> 21
10.52 Lease agreement between Whittier Narrows Business Park and the Company
dated January 10, 1994, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1994, Exhibit 10.52.
10.55 1994 Stock Option Plan dated March 22, 1994, incorporated by reference
from Annual Report on Form 10-K for the year ended December 31, 1994,
Exhibit 10.55.
10.56 Lease Agreement between Frank T. Howard and the Company dated May 4,
1994, incorporated by reference from Annual Report on Form 10-K for the
year ended December 31, 1994, Exhibit 10.56.
10.60 Lease amendment between the Company and Laguna Niguel Office Center
dated July 7, 1994, incorporated by reference from Annual Report on Form
10-K for the year ended December 31, 1994, Exhibit 10.60.
10.62 Agreement between Queen of the Angels - Hollywood Presbyterian Medical
Center, Inc. and the Company dated December 6, 1994, incorporated by
reference from Annual Report on Form 10-K for the year ended December
31, 1994, Exhibit 10.62.
10.64 Unanimous written consent dated December 30, 1994 of the Board of
Directors amending the Promissory Note between the Company and Edward A.
Johnson dated December 10, 1993, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1994, Exhibit 10.64.
10.66 Agreement between Sherman Oaks Hospital and Health Center dated March
30, 1995, incorporated by reference from Annual Report on Form 10-K for
the year ended December 31, 1995, Exhibit 10.66.
10.67 Loan Agreement between the Company and National Bank of Southern
California dated March 31, 1995, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1995, Exhibit 10.67.
10.68 Lease Agreement between the Company and Laguna Niguel Office Center
dated June 5, 1995 which supersedes lease dated June 23, 1988,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1995, Exhibit 10.68.
10.69 Sublease Agreements between the Company and Huntington Beach Hospital
and Medical Center dated July 1, 1995, incorporated by reference from
Annual Report on Form 10-K for the year ended December 31, 1995, Exhibit
10.69.
10.70 Lease Agreement between the Company and 757 Pacific Partnership dated
July 3, 1995, incorporated by reference from Annual Report on Form 10-K
for the year ended December 31, 1995, Exhibit 10.70.
10.71 Sublease Agreement between the Company and Huntington Beach Hospital and
Medical Center dated July 24, 1995, incorporated by reference from
Annual Report on Form 10-K for the year ended December 31, 1995, Exhibit
10.71.
10.72 Lease Agreement between the Company and Columbia Healthcare Corporation
dated September 14, 1995 which supersedes lease dated October 18, 1993,
incorporated by reference from Annual Report on Form 10-K for the year
ended December 31, 1995, Exhibit 10.72.
10.73 Agreement between San Fernando Community Hospital, Inc., dba Mission
Community Hospital and the Company dated October 6, 1995, incorporated
by reference from Annual Report on Form 10-K for the year ended December
31, 1995, Exhibit 10.73.
10.74 Lease Agreement between the Company and Solomon, Saltsman & Jameson
dated October 10, 1995, incorporated by reference from Annual Report on
Form 10-K for the year ended December 31, 1995, Exhibit 10.74.
<PAGE> 22
10.75 Unanimous Written Consent dated December 29, 1995 of the Board of
Directors amending the promissory note between the Company and Edward A.
Johnson dated December 30, 1994, incorporated by reference from Annual
Report on Form 10-K for the year ended December 31, 1995, Exhibit 10.75.
10.77 Operating Agreement for Optimum Care Source, LLC, incorporated by
reference from Quarterly Report on Form 10-Q for the quarter ended March
31, 1996, Exhibit 10.77.
10.78 Master Joint Venture Agreement between Professional Care Source, Inc.
and the Company dated April 19, 1996, incorporated by reference from
Quarterly Report on Form 10-Q for the quarter ended March 31, 1996,
Exhibit 10.78.
10.79 Employment Agreement between Margaret M. Minnick and Optimum Care
Source, LLC, incorporated by reference from Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, Exhibit 10.79.
10.80 Employment Agreement between Teri L. Jolin and Optimum Care Source, LLC,
incorporated by reference from Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996, Exhibit 10.80.
10.81 Employment Agreement between Joseph H. Dadourian and Optimum Care
Source, LLC, incorporated by reference from Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, Exhibit 10.81.
10.82 Registration Agreement between Professional Care Source, Inc. and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.82.
10.83 Non-Qualified Stock Option Agreement between Joseph H. Dadourian and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.83.
10.84 Non-Qualified Stock Option Agreement between Teri L. Jolin and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.84.
10.85 Non-Qualified Stock Option Agreement between Margaret M. Minnick and the
Company dated April 24, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.85.
10.86 Agreement between Friendship Community Mental Health Center and the
Company dated April 25, 1996, incorporated by reference from Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, Exhibit 10.86.
10.87 Letter agreement dated May 15, 1995 between Schwab, Bennett & Associates
and the Company.
10.88 Letter agreement dated June 14, 1995 between Sunrise Financial Group,
Inc. and the Company.
24.1 Consent of Bruck & Perry.
24.2 Consent of Ernst & Young LLP.
<PAGE> 1
EXHIBIT 5.1
[BRUCK & PERRY LETTERHEAD]
February 6, 1997
File No.
64570.17
Optimum Care Corporation
30011 Ivy Glenn Drive
Suite 219
Laguna Niguel, CA 92677
Re: Registration Statement on Form S-2
Gentlemen::
As counsel for OptimumCare Corporation, a Delaware corporation (the
"Company"), we have examined its Restated Certificate of Incorporation, Bylaws
and such other corporate records, documents and proceedings, and such questions
of law as we have deemed relevant for the purpose of this opinion. We have also,
as such counsel, examined the Registration Statement on Form S-2 of the Company
as filed with the Securities and Exchange Commission, covering the registration
under the Securities Act of 1933, as amended, of a total of 84,193 shares of
$.001 par value common stock ("Common Stock"), including the exhibits and form
of Prospectus (the "Prospectus") filed therewith, and any amendments thereto
(collectively, the "Registration Statement").
Upon the basis of such examination, we are of the opinion that:
1. The Company is a corporation duly authorized and validly existing
in good standing under the laws of the State of Delaware, with all requisite
power to conduct the business described in the Registration Statement.
2. The Company has an authorized capitalization as set forth under
the caption "Description of Common Stock" contained in the Prospectus.
3. The shares of the Company's Common Stock registered pursuant to
the Registration Statement have been duly and validly authorized and, subject to
the payment therefor pursuant to the terms contemplated in the final Prospectus
and, where applicable, as set forth in the agreement between the Company and the
individual purchaser, such
<PAGE> 2
shares of Common Stock will be duly and validly issued as fully paid and
non-assessable securities of the Company.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
BRUCK & PERRY
A Professional Corporation
<PAGE> 1
EXHIBIT 10.87
SCHWAB, BENNETT & ASSOCIATES
MANAGEMENT CONSULTANTS
9000 SUNSET BLVD., SUITE 800
LOS ANGELES, CA 90069
(310) 205-6900
FAX: (310) 205-6915
May 15, 1995
Paul Berlin
Optimum Care
30011 Ivy Glen Drive
Laguna Niguel, California 92677
Dear Paul:
We are very pleased that you have asked us to render consulting services in
connection with the development of a mental health integrated delivery system
and any other matters which may arise out of such (the "Consultation Matter").
This letter shall serve to outline the scope of our services, confirm that we
are in mutual agreement with respect to the work that we are expected to perform
on your behalf, set forth the financial arrangements pursuant to which Schwab,
Bennett & Associates will undertake to render service for you, and confirm your
approval of the arrangements set forth herein.
1. Our services shall consist of advising OPTIMUM CARE regarding:
- General strategy
- Acquisitions
- Product Development
- Integrated delivery
- Other matters as appropriate
2. In consideration of our rendering services to you in connection with
the Consultation Matter, you shall furnish to Schwab, Bennett & Associates a
retainer of $10,000, in advance of our rendering services, to be applied against
our overall fee. In no circumstance shall our fee for the first 90 days of the
consultation be more than $80,000. Compensation for the consultation will be in
the form of 50% cash and 50% stock valued at mutually agreed upon market price.
Partner's hourly rates are $225.00 to $275.00,
<PAGE> 2
professional associates rates range from $75.00 to $150.00 per hour. Support
staff time is billed at $35.00.
3. In addition to the payment of the consultation fees set forth in
paragraph 2, you agree to reimburse Schwab, Bennett & Associates for all
reasonable costs and expenses incurred in the scope of our rendering services to
you, including in-house expenses such as long distance telephone, conference
calls, photocopying ($.05 per page) and printing costs associated with your
reports, messenger service necessary for your project, travel to your meetings
($.25/mile) and the fees of experts or other third parties (i.e., design firms,
attorneys) which you authorize us to employ for you.
4. We shall send you periodic statements for fees and costs incurred by
us on your behalf, and you agree to pay these statements within ten (10) days
following your receipt of such statements. In the event that these fees or costs
are not paid within forty-five days of the closing date of the monthly
statement, i.e., the date that appears on the statements, there shall be a
charge of interest at an annualized rate of twelve percent (12%) compounded
monthly, posted to your account each month based upon the unpaid balance.
5. This arrangement shall continue until completion of Phase One, or
until otherwise terminated by either of us at any time by 30 days written
notice. When our service concludes, all unpaid charges will immediately become
due and payable.
If the foregoing terms and conditions of our engagement are acceptable
to you, please indicate your approval by signing where indicated on the enclosed
copy of this letter and returning the countersigned letter to me.
We look forward to working with you.
It is agreed that the areas of the Consultation also include the elements noted
on the attached proposal.
Sincerely,
Ted Schwab
Partner
ACCEPTED AND AGREED TO:
I have read and understood the foregoing terms and agree to them, as of the date
set forth below.
NAME
- ---------------------------
DATE
- ---------------------------
<PAGE> 3
PURPOSE
Expand the market opportunities and financial success of Optimum Care by
building strategic partnership with outpatient providers and moving into new
markets.
THE PROPOSAL
<TABLE>
<CAPTION>
AREAS OF THE CONSULTATION COST (IN 000S) PEOPLE
- ---------------------------------------------------------- ------------------------- -------------------------
BUSINESS PLAN
<S> <C> <C>
Incorporate new business lines $5 - $10 Ted
Financial proforma $6 - $10 Peter
Expansion $5 - $10 Ted & Peter
MARKET NEEDS
Review market study $1.5 - $2 Ted & Ginger
Qualitative update $2 - $3 Ted & Ginger
Focus results to Optimum $1.5 - $3 Ted
PRODUCT DEVELOPMENT
Commercial market $4 - $6 Ted & Ginger
Medicare market $4 - $6 Ted & Daun
Medi-Cal market $4 - $6 Ted & Daun
BUILD THE NETWORK
Westside $5 - $7 Ted
Inland Empire $5 - $7 Ted
San Fernando Valley $5 - $7 Ted
Review Orange County (due diligence) $5 - $7 Ted
MARKETING PLAN
Commercial Market $10 - $12 Ted & Ginger
Medicaid Market $5 - $7 Ted & Daun
Medicare Market $5 - $7 Ted & Daun
TOTAL $73 - $100
PRICE
Consultant Rates
Schwab $225
Cowen $185
Martin $150
Wilson $100
</TABLE>
Ability to take equity in the project is negotiable.
<PAGE> 1
EXHIBIT 10.88
SUNRISE FINANCIAL GROUP, LTD.
919 Third Avenue, 19th Floor
New York, New York 10022
(212) 421-1616
June 13, 1995
Mr. Ed Johnson
Optimumcare Corp.
30011 Ivy Glen Drive, Suite 219
Laguna Niguel, California 92677 via fax 714 495-4316
Gentlemen:
As we discussed, Optimumcare Corp. (the "Company") is interested in
retaining Sunrise Financial Group, Inc. ("Sunrise") as its consultant for
financial public relations.
Services
The services Sunrise will provide include the following: preparing a
fact sheet on the Company (for which you pay in advance, as well as approve the
artwork and layout); assistance to the Company in planning and supervision of
such financial communication activities as the annual report, quarterly reports
and other financial presentations (except a slide show); performance of public
relations and corporate communications projects as are mutually agreed on;
planning meetings with institutional investors, research analysts and retail
brokers; preparing and disseminating press releases; handling all inquiries
about the Company; maintaining a mailing list of all those interested in Company
literature; distributing business reply cards and contacting those brokers who
return them to ascertain their interest in meeting management of the Company;
seeking additional market makers for Company securities; and handling media
relations.
As compensation for Sunrise's services, the Company will pay Sunrise
the following fees:
1. An annual consulting fee of 36,000 Company common shares payable
upon execution of this engagement letter, with piggyback
registration rights.
2. The Company will issue to Sunrise a non-cancellable option to
purchase up to 200,000 shares of the outstanding stock of the
Company at $0.65 per share.
Option
The option shall be exercisable for five years from issuance. During
the term of the
<PAGE> 2
option and upon written demand from Sunrise, the Company shall, on one occasion
only, promptly register the common stock underlying the option at Company
expense (excluding Sunrise's counsel's fees and any underwriting or selling
commission). The Company further agrees that during the term of the option, if
the Company intends to file a Registration Statement for the public sale of its
securities (other than a Form S-8, S-4 or comparable Registration Statement), it
will notify Sunrise and if so requested will include in that Registration
Statement the common stock underlying the option, at Company expense (excluding
prorated SEC registration fees, Sunrise's counsel fees and any underwriting or
selling commissions). The number of shares and exercise price per share subject
to the option shall be adjusted in the case of any dividend, stock split or
other recapitalization or reorganization so that the option shall not be
diminished or diluted. The option may also be assigned. Cashless exercise is
permitted. To the extent the Company issues shares in any acquisition(s) other
than PHI or CWMI, an additional option(s) shall be granted to Sunrise equal to
4% of the amount of shares issued in such acquisition(s), at an exercise price
equal to that used in the acquisition, under similar terms as above.
Expense Reimbursement
In addition to the fees payable hereunder, the Company shall reimburse
Sunrise, upon request from time to time, for all reasonable out-of-pocket
expenses incurred by Sunrise (including but not limited to printing and graphic
design, travel, postage, copying, secretarial, and phone expenses) in connection
with Sunrise's services pursuant to this agreement. Individual out-of-pocket
expenses will not exceed $250.00 without the consent of the Company. The Company
will prepay $5,000 to Sunrise which Sunrise will draw against for expenses. The
Company will replenish this amount monthly to the $5,000 level. Upon expiration
of this agreement, any balance in this expense account will be returned to the
Company less any fees outstanding.
Term
This agreement shall be for a term of at least one year. Thereafter,
either party may terminate this agreement at any time upon thirty (30) days'
prior written notice, without liability or continuing obligation to the other
party, except that termination shall not affect (a) the reimbursement and
indemnification provisions contained in this agreement, nor (b) the Company's
obligation for the fees called for above.
Indemnification
The Company agrees that it will indemnify and hold harmless Sunrise,
its officers, directors, employees, agents and controlling persons from and
against any and all losses, claims, damages, liabilities and expenses, joint or
several (including all reasonable fees and expenses of counsel), arising out of
Sunrise's services pursuant to this agreement. However, the Company will not be
liable under this paragraph to the extent that any loss, claim, damage,
liability or expense is found in a final judgment by a court of competent
jurisdiction to have resulted from Sunrise's gross negligence or willful
misconduct. The Company agrees to notify Sunrise promptly of the assertion
against it or any other person of any claim or the commencement of any action or
proceeding relating to any matter which involved Sunrise.
<PAGE> 3
Miscellaneous
The benefits of this agreement shall inure to the respective successors
and assigns of the parties, and the obligations and liabilities assumed in this
agreement by the parties shall be binding upon their respective successors and
assigns.
The validity and interpretation of this agreement shall be governed by
the laws of the State of New York as applied to agreements made and to be fully
performed therein. The parties agree that neither shall commence any litigation
against the other arising out of this Agreement or its termination period except
in a court located in the City of New York. Each party consents to the in
personam jurisdiction over it by such a court and consents to the service of
process of such a court on it by mail.
All costs of enforcing any debt or obligation of the Company to Sunrise
which arises under this Agreement, including all attorneys fees and expenses,
shall be paid by the Company.
If the foregoing correctly sets forth our agreement, please sign, date
and return to us the enclosed copy of this letter, whereupon this letter shall
contain a working agreement between us. Sunrise is looking forward to working
with you in making OptimumCare highly successful and prosperous.
Sincerely,
SUNRISE FINANCIAL GROUP, INC.
By:/s/ Nathan A. Low
----------------------------
Nathan A. Low, President
Confirmed and Agreed to this
14th day of June, 1995
OptimumCare Corp.
By:/s/ Ed Johnson
------------------------------
Mr. Ed Johnson, Chairman
<PAGE> 1
EXHIBIT 24.1
CONSENT OF BRUCK & PERRY
With regard to the Form S-2 Registration Statement to be filed with the
Securities and Exchange Commission by OptimumCare Corporation, a Delaware
corporation, we hereby consent to the use of our name under the section entitled
"Legal Matters" in the Prospectus which is a part of said Form S-2 Registration
Statement.
Newport Beach, California BRUCK & PERRY
February 6, 1997 A Professional Corporation
<PAGE> 1
EXHIBIT 24.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-2 No. 333- ) and related Prospectus of
OptimumCare Corporation for the registration of 84,193 shares of its common
stock and to the incorporation by reference therein of our report dated March
18, 1996, except for Note 8 and Note 10, as to which the date is January 16,
1997, with respect to the consolidated financial statements and schedule of
OptimumCare Corporation included in its Annual Report, as amended, (Form
10-K/A) for the year ended December 31, 1995, filed with the Securities and
Exchange Commission.
Orange County, California
January 30, 1997
