<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 1998
Commission file number 33-17387
ALLIANCE HEALTH, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-219377
(State or other jurisdiction of (I.R.S. Employer I.D.#)
incorporation or organization)
421 E. Airport Freeway, Irving, Texas 75062
(Address of principal executive office) (Zip Code)
Issuer's telephone number, including area code (972)-255-5533
Securities registered under Section 12(b) of the Exchange Act:
Name of each exchange on
Title of each class which registered
- -----------------------------------------------------------------------------
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, par value $0.01
_____________________________________________________________________________
(Title of class)
_____________________________________________________________________________
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. Yes X No
State issuer's revenues for its most recent fiscal year $2,617,198.
State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days. No market for common stock.
Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13, or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court. Yes X No
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date. 3,590,000
<PAGE>
PART I.
Item 1. Description of Business
Alliance Health, Inc. ("Company") was incorporated on September 4, 1987.
It had no business activity until July 1989 at which time it began to operate
one clinic in Dallas, Texas, which it closed the same year.
On May 12, 1995, the Company acquired from K Clinics, P.A. ("K Clinics"),
the marketing division of K Clinics. The marketing division will continue the
contract to perform advertising and marketing services for S. J. Kechejian,
M.D.,P.A. and Metroplex Specialties, P.A. medical facilities in the Dallas/
Ft. Worth Metroplex.
Metroplex Specialties, P.A. is one of the "partnerships" of the Company.
On October 23, 1995 the Company began leasing an MRI it purchased and installed
at 200 W. Colorado Blvd., Dallas, Texas to Metroplex Specialties, P.A. for $300
per scan. In the year 1998 revenue was $887,100 as compared to 1997 revenue of
$779,700. The Hitachi MRI purchased by the Company located at 1218 S. Main
Street, Ft. Worth, Texas, is being leased at the same rate of $300 per scan
and generated income in 1998 of $153,600.
Alliance Health has the experience through its association with K Clinics
in the Dallas/Fort Worth area to offer the services of a Management Service
Organization (MSO). K Clinic has developed innovative marketing, advertising
and administrative services over the past ten years in conjunction with S. J.
Kechejian, M.D., P.A. In May 1995 the advertising division of K Clinics was
sold to Alliance Health, Inc. The further development of the MSO and
offering of additional administrative and specialty services to physicians
and medical groups has been developed and management services are currently
being contracted by two medical facilities in East Texas.
Item 2. Description of Property
None.
Item 3. Legal Proceedings
The Company is not a party to any pending legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this report.
-2-
<PAGE>
PART II
Item 5. Market for the Registrant's Common Stock
and Related Shareholder Matters
On September 30, 1998 the approximate number of holders of record of the
Company common stock was 306. The Company's common stock has no established
trading market.
The Company has never paid any dividends on the common stock and does not
expect to do so in the foreseeable future.
Item 6. Management's Discussion and Analysis or Plan of Operation
Prior to May 1995, the Company had no operating business since June 1990.
On May 12, 1995, an 8-K was filed regarding the acquisition of the Marketing
Division of K Clinics which included $285,879 in cash in exchange for one
million two hundred thousand (1,200,000) shares of common stock of Alliance
Health, Inc. (the "Company"). K Clinics is wholly owned by Sarkis J.
Kechejian, M.D. who is also the principal shareholder of the Company.
The Company's primary source of income during the year was advertising
income. An increase of twenty eight percent (28%) was realized in 1998 as
compared to 1997. This was due to fees from Aldine Medical Associates, an
affiliate, and an increase in the number of clinic locations at S. J.
Kechejian, M.D., P.A. Other marketing income was generated from Metro
Pharmacy, Inc. and Metroplex Specialties, Inc.
The Company also realized a considerable increase in fees from Metroplex
Specialties, Inc. from the MRI lease. An increase of 37% was realized in 1998
as compared to 1997. The revenue from Metroplex Specialties, Inc. is on a per
scan basis and is expected to continue at roughly $85,000 per month during the
next fiscal year.
Expenses in 1998 increased twenty two percent (22%) over 1997, principally
due to an increase in salaries and employee benefits and general and
administrative expenses. General and administrative expenses increased
seventeen percent (17%) during the 1998 year, principally due to increases in
maintenance costs ($80,000) and repair expenses ($20,000). In February, 1997,
the Company hired a Chief Operating Officer to facilitate the integration of
operating systems.
All furniture, fixtures, and equipment (FF&E) will be leased to Aldine
Medical Associates ("Aldine") an affiliate, at cost plus ten percent (10%).
The majority of the FF&E to be leased to Aldine for the Tyler clinic is from
the Aldine Medical Clinic of Houston (now closed) and any additional FF&E
required will be purchased by the Company and leased at the same rate.
-3-
<PAGE>
Liquidity and Financial Resources
The Company had $739,596 in cash at September 30, 1998.
The Company has an agreement with Metroplex Specialties, P.A. for the lease
of two MRIs at $300/per scan. It is expected this lease will continue to
produce revenues of approximately $85,000 per month. The second MRI has
increased income from the MRI leases by $153,600.
The Board approved the purchase of a facility in Longview, Texas to be
leased to Aldine Medical Associates. The facility will house a medical clinic,
a physical therapy center and an imaging center. The imaging center will
initially consist of a Computerized Axial Tomograph (cat scanner) that Alliance
Health purchased and installed at the facility. The leasing arrangement will
be with Aldine at a rate of $125 per scan.
The Company has loaned Aldine $108,348 in start-up and administrative
costs. The loan was to be paid back during the year ended September 30, 1998
with an interest rate of 10%. As of September 30, the outstanding balance
due on the loan was $53,487. The loan has been extended at the same
interest rate for an additional year.
The Company receives $102,500 per month from S. J. Kechejian, M.D., P.A.,
$27,500 from Metroplex Specialties, $7,500 from Metro Pharmacy and $10,000 from
Aldine Medical Associates for marketing services. This is an ongoing arrange-
ment acquired with the marketing division from K Clinics. It is anticipated the
revenue for marketing services will increase in the next year as S. J.
Kechejian, M.D., P.A. and Aldine Medical Associates are expected to add
additional clinic locations thus increasing the need for additional marketing
services.
The Company has no long term debt outstanding at year end. Income from the
marketing division, lease of the MRIs and CT and Management Service Fees are
expected to be sufficient cash flow to cover all operating and administrative
expenses.
Year 2000. The Company currently believes that it does not have any
significant exposure to uncertainties nor material anticipated costs with
regard to Year 2000 issues. Current systems and any anticipated upgrades are
2000 compliant.
Item 7. Financial Statements
Financial statements in response to Item 7 are presented on pages F-1
through F-10.
-4-
<PAGE>
ALLIANCE HEALTH, INC.
INDEX TO AUDITED FINANCIAL STATEMENTS
Page
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . .F-2
Balance Sheets at September 30, 1998 and 1997. . . . . . . . . . . .F-3
Statements of Income for the Years Ended
September 30, 1998 and 1997. . . . . . . . . . . . . . . . . . . .F-4
Statements of Changes in Stockholders' Equity
for the Years Ended September 30, 1998 and 1997. . . . . . . . . .F-5
Statements of Cash Flows for the Years Ended
September 30, 1998 and 1997. . . . . . . . . . . . . . . . . . . .F-6
Notes to Financial Statements. . . . . . . . . . . . . . . . . . . .F-7
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors
Alliance Health, Inc.
We have audited the accompanying balance sheets of Alliance Health, Inc. as of
September 30, 1998 and 1997, and the related statements of income, changes in
stockholders' equity and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and signifi-
cant estimates made by management, as well as evaluating the overall finan-
cial statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Alliance Health, Inc. as of
September 30, 1998 and 1997, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
Jackson & Rhodes P.C.
Dallas, Texas
November 17, 1998
F-2
<PAGE>
ALLIANCE HEALTH, INC.
BALANCE SHEETS
September 30, 1998 and 1997
ASSETS
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Current assets
Cash $739,596 $940,716
Accounts receivable
affiliates (Note 6) 64,413 178,348
Other assets 12,134 15,528
_______ _________
Total current assets 816,143 1,134,592
Property and equipment (Note 3) 2,451,752 1,234,422
Less accumulated depreciation (591,577) (341,683)
_________ _________
1,860,175 892,739
__________ __________
$2,676,318 $2,027,331
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
Trade $52,825 $68,166
Officer - 1,592
Accrued liabilities 21,116 -
Income taxes payable 249,889 287,231
_______ _______
Total current liabilities 323,830 356,989
Deferred income taxes 34,532 -
Commitments and contingencies (Note 5) - -
Stockholders' equity:
Preferred stock, $.01 par,
100,000 shares authorized,
none issued - -
Common stock, $.01 par,
20,000,000 shares authorized,
issued and outstanding
3,590,000 shares 35,900 35,900
Paid-in capital 831,166 831,166
Retained earnings 1,450,890 803,276
_________ _________
Total stockholders' equity 2,317,956 1,670,342
_________ _________
$2,676,318 $2,027,331
</TABLE>
See accompanying notes to financial statements.
F-3
<PAGE>
ALLIANCE HEALTH, INC.
STATEMENTS OF INCOME
Years Ended September 30, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Revenues:
Advertising income from
affiliates (Note 6) $ 1,520,000 $1,190,000
MRI income from affiliates
(Note 6) 1,070,445 779,700
Interest 26,753 24,045
_________ _________
2,617,198 1,993,745
Expenses:
Advertising 649,672 579,917
Salaries and employee benefits 396,172 304,142
Depreciation 249,893 169,202
General and administrative 338,939 289,715
_________ _________
1,634,676 1,342,976
_________ _________
Operating income 982,522 650,769
Other income 26,948 34,652
Income before taxes 1,009,470 685,421
Income taxes (Note 4) 361,856 291,239
________ ________
Net income $647,614 $394,182
Basic earnings per common share $0.18 $0.11
Weighted average number of
common shares outstanding 3,590,000 3,590,000
</TABLE>
See accompanying notes to financial statements.
F-4
<PAGE>
ALLIANCE HEALTH, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Years Ended September 30, 1998 and 1997
<TABLE>
<CAPTION>
Additional
Common Stock Paid-in Retained
Shares Par Value Capital Earnings Total
<S> <C> <C> <C> <C> <C>
Balance, 9-30-96 3,590,000 $35,900 $831,166 $409,094 $1,276,160
Net income - - - 394,182 394,182
_________ ______ _______ _______ _________
Balance, 9-30-97 3,590,000 35,900 831,166 803,276 1,670,342
Net income - - - 647,614 647,614
_________ _______ ________ __________ __________
Balance, 9-30-98 3,590,000 $35,900 $831,166 $1,450,890 $2,317,956
</TABLE>
See accompanying notes to financial statements.
F-5
<PAGE>
ALLIANCE HEALTH, INC.
STATEMENTS OF CASH FLOWS
Years Ended September 30, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Cash flows from operating activities:
Net income $647,614 $394,182
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 249,894 169,202
Deferred income taxes 40,518 (69,224)
Changes in assets and liabilities:
Accounts receivable - affiliates 59,390 (6,966)
Other assets (2,592) (7,545)
Income taxes payable (37,341) 292,156
Accounts payable (16,934) 36,341
Accrued liabilities 21,116 (1,356)
________ _______
Net cash provided by
operating activities 961,665 806,790
Cash flows from investing activities:
Accounts receivable - affiliates 54,545 (108,032)
Purchase of equipment (1,217,330) (123,000)
_________ _______
Net cash used by
investing activities (1,162,785) (231,032)
Net increase (decrease)
in cash (201,120) 575,758
Cash at beginning of year 940,716 364,958
_________ ________
Cash at end of year $739,596 $940,716
Income taxes paid $358,678 $ 68,307
</TABLE>
See accompanying notes to financial statements.
F-6
<PAGE>
ALLIANCE HEALTH, INC.
Notes to Financial Statements
Years Ended September 30, 1998 and 1997
1. Organization
Alliance Health, Inc. (the "Company") was incorporated in Delaware on
September 4, 1987. In 1995, the Company acquired the advertising
division (the "Division") of K Clinics, P.A. ("K Clinics"), from Dr.
S. J. Kechejian, M.D. The Company currently offers advertising and
management services to medical clinics of affiliated companies.
2. Summary of Significant Accounting Policies
Use of Estimates and Assumptions
Preparation of the Company's financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those
estimates.
Statement of Cash Flows
For statement of cash flow purposes, the Company considers short-term
investments with original maturities of three months or less to be cash
equivalents.
Property and Equipment
Property and equipment are stated at cost. Cost of property renewals and
betterments are capitalized; cost of property maintenance and repairs are
charged against operations as incurred.
Depreciation is computed using the straight-line method over the
estimated useful lives of the individual assets as follows:
Equipment 7 years
Furniture and fixtures 4 years
Leasehold improvements 5 years
Income Taxes
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes"
("SFAS 109"). SFAS 109 utilizes the asset and liability method of
computing deferred income taxes. The objective of the asset and
liability method is to establish deferred tax assets and liabilities
for the temporary differences between the financial reporting basis
and the tax basis of the Company's assets and liabilities at enacted
tax rates expected to be in effect when such amounts are realized or
settled.
F-7
<PAGE>
ALLIANCE HEALTH, INC.
Notes to Financial Statements
Years Ended September 30, 1998 and 1997
2. Summary of Significant Accounting Policies (Continued)
Earnings Per Common Share
In March 1997, the Financial Accounting Standards Board issued State-
ment of Financial Accounting Standards No. 128, Earnings Per Share
("SFAS 128"). SFAS 128 provides a different method of calculating
earnings per share than was formerly used in APB Opinion 15. SFAS
128 provides for the calculation of basic and diluted earnings per
share. Basic earnings per share includes no dilution and is comput-
ed by dividing income available to common stockholders by the
weighted average number of common shares outstanding for the period.
Dilutive earnings per share reflects the potential dilution of
securities that could share in the earnings of the Company. The
Company was required to adopt this standard in the fourth
quarter of calendar 1997. Because the Company has no potential
dilutive securities outstanding, the accompanying presentation is
only of basic earnings per share.
3. Property and Equipment
Property and equipment consisted of the following at September 30:
1998 1997
Buildings 300,836 -
Equipment (principally magnetic
resonance imaging) 1,795,006 1,063,074
Leasehold improvements 316,910 132,348
Furniture and fixtures 39,000 39,000
__________ _________
$ 2,451,752 $ 1,234,422
4. Income Taxes
Following is a reconciliation between reported income taxes and the
amount computed by applying the statutory federal income tax rates to
pre-tax accounting income for the periods ended September 30:
1998 1997
Expected provision for federal income taxes $343,210 $233,000
State income taxes 51,500 42,000
Other (32,854) 16,239
________ _______
$361,856 $291,239
F-8
<PAGE>
ALLIANCE HEALTH, INC.
Notes to Financial Statements
4. Income Taxes (Continued)
Income taxes were as follows for the years ended September 30:
1998 1997
Current $321,338 $360,463
Deferred $ 40,518 (69,224)
________ ________
$361,856 $291,239
Income tax expense for each year consisted of current taxes. The
components of the deferred tax (asset) liability are as follows at
September 30:
1998 1997
Depreciation $(64,458) $(61,374)
Alternative minimum tax 25,522 25,522
Cash Basis 4,404 41,839
________ ________
$ 34,532 $(5,987)
5. Commitments and Contingencies
Concentration of Credit Risk
The Company invests its cash and certificates of deposit primarily in
deposits with major banks. Certain deposits, at times, are in excess of
federally insured limits. The Company has not incurred losses related to
its cash.
6. Related Party Transactions
All of the Company's advertising income and MRI income was for services
rendered to various affiliated companies owned by the Company's major
stockholder. The MRI's are leased on a month-to-month (per-scan) basis.
The Company loaned an affiliate $108,348 to fund start-up costs during
fiscal year 1997. The affiliate is to pay the borrowings back with
10% interest.
The Company leases its office space and equipment on a month-to-month
basis from S. J. Kechejian, M.D., P.A., an affiliated company. The
amount paid in 1998 and 1997 was $42,515 and $33,188, respectively.
F-9
<PAGE>
ALLIANCE HEALTH, INC.
Notes to Financial Statements
7. Accounting Developments
SFAS 129
Statement of Financial Accounting Standards No. 129, Disclosure of
Information about Capital Structure ("SFAS 129"), effective for periods
ending after December 15, 1997, establishes standards for disclosing
information about an entity's capital structure. SFAS 129 requires
disclosure of the pertinent rights and privileges of various securities
outstanding (stock, options, warrants, preferred stock, debt and
participating rights) including dividend and liquidation preferences,
participant rights, call prices and dates, conversion or exercise
prices and redemption requirements. Adoption of SFAS 129 has had
no effect on the Company as it currently discloses the information
specified.
SFAS 130
Statement of Financial Accounting Standards (SFAS) 130, "Reporting
Comprehensive Income", establishes standards for reporting and display
of comprehensive income, its components and accumulated balances.
Comprehensive income is defined to include all changes in equity except
those resulting from investments by owners and distributions to
owners. Among other disclosures, SFAS 130 requires that all items
that are required to be recognized under current accounting
standards as components of comprehensive income be reported in a
financial statement that is displayed with the same prominence as
other financial statements. Results of operations and financial
position are unaffected by implementation of this new standard.
SFAS 131
SFAS 131, "Disclosure about Segments of a Business Enterprise",
establishes standards for the way that public enterprises report
information about operating segments in annual financial statements
and requires reporting of selected information about operating seg-
ments in interim financial statements issued to the public. It also
establishes standards for disclosures regarding products and
services, geographic areas and major customers. SFAS 131 defines
operating segments as components of an enterprise about which
separate financial information is available that is evaluated
regularly by the chief operating decision maker in deciding how to
allocate resources and in assessing performance. This accounting
pronouncement will not have an effect on the Company's financial
statements, since the Company only operates in one segment of
business, the offering of advertising and management services to
medical clinics.
F-10
<PAGE>
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons,
Compliance with Section 16(A) of the Exchange Act
The executive officers and directors of Alliance Health, Inc. are
identified in the following table. Each has held the indicated positions
with Alliance Health, Inc. since May 19, 1995, and will serve in these
offices until their successors are elected and qualified.
NAME AGE POSITION
Sarkis J. Kechejian 60 President, Treasurer
and Chairman of the Board
Sharilyn J. Bruntz Wilson 48 Vice President and Secretary
Richard C. Schneck 48 Chief Operating Officer
Kenneth Guest 59 Director
James Kenney 57 Director
George Nicolaou, M.D. 77 Director
Mac Martirossian 44 Director
Dr. Kechejian is also president and sole owner of S. J. Kechejian, M.D.,
P.A. dba Doctor's Clinic/K Clinic which consists of twenty one clinics and
five PT/OT centers and Aldine Medical Associates dba K Clinic, which
consists of two clinics, one PT/OT Center and one cat scan imaging center
treating patients injured on the job or in auto accidents.
Ms. Wilson is Secretary and Chief Financial Officer of S. J. Kechejian,
M.D., P.A. and was Secretary/Treasurer of K Med Centers, Inc. from January,
1987 until December, 1991. Prior to that time, for over five years, she was
a Legal Assistant with several law firms.
Mr. Guest is an attorney who has been practicing in the Dallas area
since 1965. He is with the law firm of Ken Guest and Associates. He has
investments in several manufacturing and retail businesses.
-5-
<PAGE>
James W. Kenney has been a Director since September, 1992. He is
currently associated with San Jacinto Securities, Inc. as Executive Vice
President. From February, 1992 to June, 1993 he served as Vice President of
Investments for Renaissance Capital Group, Inc. From October, 1989 to
February, 1992 he served as Senior Vice President, Director of Trading and
Sales for Capital Institutional Services. From February, 1987 to October,
1989, he served as Senior Vice President for retail sales for Rauscher
Pierce Refsnes, Inc. Mr. Kenney received a BA degree in economics from the
University of Colorado in Boulder, Colorado. Mr. Kenney also currently
serves on the Board of Directors of the following companies: Consolidated
Health Care Associates, Inc., Industrial Holdings, Inc., Scientific
Measurement Systems, and Tricom Corporation.
Dr. Nicolaou is a retired physician. He has extensive business
experience doing consulting work.
Mac Martirossian has been a Director since May, 1996. He is currently
Senior Vice President of Business Development for Howard Schultz &
Associates. From April 1989 to August 1995, he served in various Executive
Management positions at AMRE, Inc., with his last position as Vice
President-Operations.
Richard Schneck is Chief Operating Officer of Alliance Health, Inc. He
joined Alliance in February, 1997. Prior to that time he was an Executive
Manager in HMO operations, as well as Hospital Financial and Administrative
operations. Mr. Schneck has over 20 years of health care management
experience.
Item 10. Executive Compensation
Cash Compensation
For the fiscal year ended September 30, 1998, Dr. Kechejian received no
cash remuneration. Ms. Wilson received a salary of $61,868 and Mr. Schneck
received a salary of $157,500 for the year ended September 30, 1998.
Compensation of Directors
Directors received $500 for each of the three Board of Director's
meetings attended.
Item 11. Security Ownership of Certain Beneficial Owners and Managers
The following information is submitted as of September 30, 1998 with
respect to the Company's voting securities owned beneficially by each person
known to the Company who owns more than 5% of the Common Stock of the
Company, this being the only class of voting securities now outstanding and
by all directors and officers of the Company individually and as a group.
-6-
<PAGE>
Name and Address of Amount Bene- Approximate
Beneficial Owner ficially owned Percent of Class
Sarkis J. Kechejian, M.D. 2,809,518 78%
421 E. Airport Freeway
Irving, Texas 75062
Nishan J. Kechejian, M.D. 450,000 12.5%
824 Oak St.
Brockton, MA 02401
Item 12. Certain Relationships and Related Transactions
As set forth in the Company's financial statements contained in this
report, all of the Company's advertising income and MRI income was for
services rendered to affiliated companies. The Company's primary customers
are S. J. Kechejian, M.D., P.A., Aldine Medical Associates and Metroplex
Specialties, P.A., all professional corporations wholly owned by S. J.
Kechejian, M.D. These companies provide diagnostic and therapeutic medical
services to patients suffering from soft tissue injuries generally incurred
in automobile or job related accidents. Dr. Kechejian owns, directly or
indirectly, 2,809,518 shares of Common Stock of the Company (78% of the
outstanding shares).
Furthermore, the Company's office facilities are located in the same
office building owned by a company owned by Dr. Kechejian. The Company
leases its office space and equipment on a month to month basis from S. J.
Kechejian, M.D., P.A. for which it paid $30,000 for fiscal year ended
September 30, 1998.
PART IV
Item 13. Exhibits and Reports on Form 8-K
a. Exhibit 27, Financial Data Schedule
b. Management Service Agreement
-7-
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
ALLIANCE HEALTH, INC.
DATED: December 18, 1998 By: Sarkis J. Kechejian, M.D.
Chairman of the Board,
President and Treasurer
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities
and on the dates indicated.
DATED: December 18, 1998 Sarkis J. Kechejian, M.D.
Chairman of the Board and
President and Treasurer
DATED: December 18, 1998 James Kenney
Director
DATED: December 18, 1998 George Nicolaou, M.D.
Director
DATED: December 18, 1998 Kenneth Guest
Director
DATED: December 18, 1998 Mac Martirossian
Director
-8-
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 12-MOS
<FISCAL-YEAR-END> SEP-30-1998 SEP-30-1997
<PERIOD-START> OCT-01-1997 OCT-01-1996
<PERIOD-END> SEP-30-1998 SEP-30-1997
<CASH> 739,596 940,716
<SECURITIES> 0 0
<RECEIVABLES> 76,547 193,876
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 816,143 1,134,592
<PP&E> 2,451,752 1,234,422
<DEPRECIATION> (591,577) (341,683)
<TOTAL-ASSETS> 2,676,318 2,027,331
<CURRENT-LIABILITIES> 358,362 356,989
<BONDS> 0 0
0 0
0 0
<COMMON> 35,900 35,900
<OTHER-SE> 2,282,056 1,634,442
<TOTAL-LIABILITY-AND-EQUITY> 2,676,318 2,027,331
<SALES> 0 0
<TOTAL-REVENUES> 2,617,198 1,993,745
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 1,607,728 1,308,324
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 1,009,470 685,421
<INCOME-TAX> 361,856 291,239
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 647,614 394,182
<EPS-PRIMARY> .18 .11
<EPS-DILUTED> 0 0
</TABLE>
