SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 15, 1995
Date of Report (date of earliest event reported)
MEDNET, MPC CORPORATION
(Exact name of Registrant as specified in its charter)
Nevada 0-17120 88-0215949
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
Incorporation) Number)
871-C Grier Drive
Las Vegas, Nevada 89119
(Address of principal executive offices)
702-361-3119
(Registrant's telephone number, including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets
On September 15, 1995, Mednet, MPC Corporation (the "Company") completed the
acquisition of the assets (excluding cash and like assets) of Home Pharmacy, a
division of ArcVentures, Inc. ("Arc") pursuant to an Asset Purchase Agreement
dated July 29, 1995. Arc was not affiliated with the Company.
Home Pharmacy is a mail service pharmacy and prescription benefits management
company based in Chicago, Illinois. The mail service business acquired from Home
Pharmacy, together with regional mail service fulfillment for the Company's
Medi-Mail business, will be operated from a new 14,000 square foot facility
leased by the Company in Chicago. The Company intends to fully integrate the
acquired mail service business with its existing Medi-Mail business. The Home
Pharmacy prescription benefits management business will be integrated with the
Company's Medi- Claim subsidiary headquartered in LeMoyne, Pennsylvania.
The Company will file, in the time period required by applicable regulations,
pro forma financial information regarding the Company and the acquired business
and historical financial information for the acquired business. Such pro forma
information will not reflect any potential operational and purchasing
efficiencies resulting form the larger scale of the combined businesses.
The assets acquired included customer contracts, computers and other equipment,
the right to the name "Home Pharmacy" and certain other intellectual property.
The Company acquired up to $1,000,000 of Home Pharmacy's inventory, but did not
acquire the balance of Home's inventory or its cash or like assets.
The purchase price for the assets other than the inventory was $15,150,000,
consisting of $8,000,000 paid at closing, $2,500,000 represented by a short term
note and $4,650,000 represented by a hold-back note. The amount of the hold-back
note is subject to reduction based on future performance of the acquired
business, and any remaining balance of the note is due thirteen months from the
closing unless accelerated on default. The short term note and the hold back
note are secured by shares of the Company's common stock. The value of the
acquired inventory will be paid in two installments due 30 days and one year
from closing.
In determining the amount of consideration to be paid for the Home Pharmacy
assets, the Company considered the historical level of operations of Home
Pharmacy, the potential efficiencies of scale and marketing benefits which might
be obtained by combining the two businesses, the price the Company had paid for
similar acquisitions in the past, the value of Home Pharmacy's customer base and
similar factors. The acquisition of Home Pharmacy will be accounted for as a
purchase.
The foregoing is qualified in its entirety by reference to the Asset Purchase
Agreement, which is filed as an exhibit.
<PAGE>
The Company obtained the funds to purchase the assets and additional working
capital from the issuance of common stock, warrants to purchase common stock and
10% Series A Convertible Exchangeable Preferred Stock equivalent to a total of
4,701,616 shares of common stock1/. The preferred stock is entitled to a
dividend of 10% of the face amount, which may be paid in common stock for the
first twelve quarterly dividend payments. Each share of preferred stock is
entitled to a liquidation preference of $20.00 per share and is convertible,
under certain circumstances into 6 2/3 shares of common stock. The preferred
stock generally votes as a class with the common stock, but is entitled to vote
as a separate class on certain significant corporate events and other matters
affecting the preferred stock directly. If a default in the payment of the
preferred stock dividend occurs, the holders of the preferred stock are given
the right to elect two directors until the default has been cured. The preferred
stock must be redeemed by the Company for its full face amount, plus accrued but
unpaid dividends, in September, 2005. The preferred stock is protected from
dilution in certain circumstances. The foregoing is qualified in its entirety by
reference to the Certificate of Designation of the preferred stock. Certain
affiliates of the Company purchased preferred or common stock on the same terms
as third parties.
Item 7. Financial Statements and Exhibits.
(a) The following financial statements of Home Pharmacy (a
division of ArcVentures, Inc.) are filed with this Amendment No. 1:
(1) Report of Independent Public Accountants
(2) Statements of Assets and Liabilities at June 30,
1995 and 1994.
(3) Statements of Revenues and Expenses (excluding income
taxes) for the years ended June 30, 1995, 1994 and
1993.
(4) Statements of Equity for the years ended June 30,
1995, 1994 and 1993.
(5) Statements of Cash Flows for the years ended June 30,
1995, 1994 and 1993.
(b) The Company's Form 10-Q for the quarter ended September 30, 1995
contains a balance sheet at September 30, 1995 which includes the acquired
business. Pro forma balance sheets are therefore not required to be filed as
part of this Form 8-K. The following pro forma financial information regarding
the acquired business is filed with this Amendment No. 1:
(1) Pro forma Consolidated Statement of Operations for the
twelve months ended December 31, 1994.
- --------
1/ Assumes conversion of all preferred stock and exercise of all warrants.
<PAGE>
(2) Pro forma Consolidated Statement of Operations for the
nine months ended September 30, 1995
(c) The following exhibits were filed with the original of this report:
(1) Asset Purchase Agreement, as amended.
(2) Certificate of Designations of 10% Series A
Convertible Exchangeable Preferred stock
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDNET, MPC CORPORATION
Dated: December 6, 1995 By /s/ M.B. Merryman
-------------------------
M.B. Merryman, President
<PAGE>
HOME PHARMACY (A Division of ArcVentures, Inc.)
UNAUDITED STATEMENTS OF ASSETS AND LIABILITIES
December 31, September 15,
1994 1995
------------ -------------
ASSETS
CURRENT ASSETS
Receivables:
Trade, less allowance of approximately
$300,000 and $279,000 at December 31,
1994 and September 15, 1995,
respectively $3,880,182 $3,505,374
Other 626,159 473,033
Inventories 3,417,957 967,179
Prepaid expenses 76,404 8,900
---------- ----------
Total current assets 8,000,702 4,954,486
Equipment and Leasehold Improvements:
Office and pharmacy equipment 813,840 825,413
Minicomputer 223,245 223,245
Computer software 100,000 100,000
Leasehold improvements 80,398 80,398
Accumulated depreciation (457,482) (563,766)
---------- ----------
Property and Equipment, net 760,001 665,290
---------- ----------
Total Assets $8,760,703 $5,619,776
========== ==========
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable $2,260,305 $2,063,092
Accrued compensation 138,401 62,393
Customer prepayments 100,051 416,909
Other accrued expenses 51,984 16,076
---------- ----------
Total current liabilities 2,550,741 2,558,470
Deferred Rent, net 183,237 148,356
Equity, investment by and advances from
ArcVentures, Inc. 6,026,725 2,912,950
---------- ----------
Total liabilities and equity $8,760,703 $5,619,776
========== ==========
<PAGE>
HOME PHARMACY (A Division of ArcVentures, Inc.)
UNAUDITED STATEMENTS OF REVENUES AND EXPENSES (EXCLUDING INCOME TAXES)
<TABLE>
Nine Twelve Three Three Six Eight 1/2
Months Ended Months Ended Months Ended Months Ended Months Ended Months Ended
September 30, December 31, March 31, June 30, June 30, September 15,
1994 1994 1995 1995 1995 1995
------------- ------------ ------------ ------------ ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Net revenues $38,278,587 $51,280,451 $10,618,132 $10,558,255 $21,176,387 $30,629,476
Cost of goods sold (32,557,606) (43,786,665) (9,064,611) (8,779,753) (17,844,364) (26,030,628)
----------- ----------- ----------- ----------- ----------- -----------
Gross profit 5,720,981 7,493,786 1,553,521 1,778,502 3,332,023 4,598,848
Selling, general and administrative
expenses 4,609,767 6,188,155 1,273,293 1,183,365 2,456,658 3,520,714
Related-party expense allocations 472,882 619,570 167,436 226,030 393,466 587,402
----------- ----------- ----------- ----------- ----------- -----------
Operating income 638,332 686,061 112,792 369,107 481,899 490,712
Allocated interest expense 129,534 174,643 55,529 17,430 72,959 96,268
----------- ----------- ----------- ----------- ----------- -----------
Income before income taxes $ 508,798 $ 511,418 $ 57,263 $ 351,677 $ 408,940 $ 394,444
=========== =========== =========== =========== =========== ===========
</TABLE>
<PAGE>
HOME PHARMACY
(A Division of ArcVentures, Inc.)
UNAUDITED STATEMENT OF EQUITY
FOR THE EIGHT AND ONE HALF MONTHS ENDED SEPTEMBER 15, 1995
Investment By and Advances From ArcVenture, Inc.:
Beginning balance $6,026,725
Income before income taxes for the period 394,444
Advances from (payments to) ArcVentures, Inc., net (3,508,219)
----------
Ending balance $2,912,950
==========
<PAGE>
HOME PHARMACY
(A Division of ArcVentures, Inc.)
UNAUDITED STATEMENTS OF CASH FLOWS
<TABLE>
Three Three Six Eight 1/2
Months Ended Months Ended Months Ended Months Ended
March 31, June 30, June 30, September 15,
1994 1995 1995 1995
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
Cash Flows from Operating Activities:
Income before income taxes $ 57,263 $ 351,677 $ 408,940 $ 394,444
Adjustments to reconcile net income before
income taxes to net cash provided by
(used for) operating activities:
Depreciation and amortization 43,397 42,524 85,921 121,735
Changes in assets and liabilities:
Receivables 404,631 181,200 585,831 527,934
Inventories (195,243) 2,730,957 2,535,714 2,450,778
Prepaid expenses 9,798 34,224 44,022 67,504
Accounts payable, customer prepayments,
and other current liabilities 1,031,314 (970,103) 61,211 7,729
Deferred rent (25,564) (4,050) (29,614) (34,881)
---------- ---------- ---------- ----------
Net cash provided by (used for)
operating activities 1,325,596 2,366,429 3,692,025 3,535,243
Cash Flows Used for Investing Activities,
purchases of property and equipment (6,243) (20,781) (27,024) (27,024)
Cash Flows from Financing Activities,
advances from (payments to) ArcVentures, Inc. (1,319,353) (2,345,648) (3,665,001) 3,508,219)
---------- ---------- ---------- ----------
Net Change in Cash - - - - - - - -
Cash, beginning of year - - - - - - - -
---------- ---------- ---------- ----------
Cash, end of year $ - - $ - - $ - - $ - -
========== ========== ========== ==========
</TABLE>
<PAGE>
HOME PHARMACY
(A DIVISION OF ARCVENTURES, INC.)
FINANCIAL STATEMENTS
AS OF JUNE 30, 1995 AND 1994, AND FOR
EACH OF THE THREE YEARS ENDED JUNE 30,
1995
<PAGE>
HOME PHARMACY
(a division of ArcVentures, Inc.)
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1995, 1994 AND 1993
1995 1994
---------- ----------
ASSETS
Current Assets:
Receivables:
Trade, less allowance of approximately
$270,000, and $275,000 at June 30,
1995 and 1994, respectively $3,411,156 $4,208,026
Other 509,354 435,072
Inventories 882,243 1,542,995
Prepaid expenses 32,382 118,595
---------- ----------
Total current assets 4,835,135 6,304,688
Property and Equipment, net 701,104 833,924
---------- ----------
Total assets $5,536,239 $7,138,612
========== ==========
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable $1,599,446 $1,314,581
Accrued compensation 119,130 173,452
Customer prepayments 874,670 431,435
Other accrued expenses 18,706 57,221
---------- ----------
Total current liabilities 2,611,952 1,976,689
Deferred Rent, net 153,623 182,803
Commitments and Contingencies (Note 9)
Equity, investment by and advances from
ArcVentures, Inc. 2,770,664 4,979,120
---------- ----------
Total liabilities and equity $5,536,239 $7,138,612
========== ==========
The accompanying notes to financial statements are an integral part of these
statements.
<PAGE>
HOME PHARMACY (A Division of ArcVentures, Inc.)
STATMENTS OF EQUITY
FOR THE YEARS ENDED JUNE 30, 1995, 1994 AND 1993
1995 1994 1993
---------- ---------- ----------
Investments By and Advances
from ArcVentures, Inc.:
Beginning balance $4,979,120 $4,588,285 $5,475,625
Income before income taxes for
the year 379,368 144,891 248,527
Advances from (payments to)
ArcVentures, Inc., net (2,587,824) 245,944 (1,135,867)
---------- ---------- ----------
Ending, balance $2,770,664 $4,979,120 $4,588,285
========== ========== ==========
The accompany notes to financial statements are an integral part of these
statements.
<PAGE>
HOME PHARMACY (A Division of ArcVentures, Inc.)
STATEMENTS OF REVENUES AND EXPENSE (EXCLUDING INCOME TAXES)
For the Years Ended June 30, 1995, 1994 and 1993
1995 1994 1993
----------- ----------- -----------
Net revenues $46,887,645 $47,668,586 $39,155,047
Cost of goods sold (40,096,138) (40,661,479) (33,718,341)
----------- ----------- -----------
Gross profit 6,791,507 7,007,107 5,436,706
Selling, general and
administrative expenses 5,540,012 6,107,446 4,524,771
Related-party expense allocations 691,694 585,918 478,359
----------- ----------- -----------
Operating income 559,801 313,743 433,576
Allocated interest expense 180,433 168,852 185,049
----------- ----------- -----------
Income before income
taxes $ 379,368 $ 144,891 $ 248,527
=========== =========== ===========
The accompanying notes to financial statements are an integral part of these
statements.
<PAGE>
HOME PHARMACY
(A Division of ArcVentures, Inc.)
STATEMENTS OF CASH FLOWS
For the Years Ended June 30, 1995, 1994 and 1993
1995 1994 1993
---------- ---------- ----------
Cash Flows from Operating Activities:
Income before income taxes $ 379,368 $ 144,891 $ 248,527
Adjustments to reconcile income before
income taxes to net cash provided
by (used for) operating activities:
Depreciation and amortization 170,623 126,755 66,607
Changes in assets and liabilities:
Receivables 722,588 (1,777,933) 1,055,198
Inventories 660,752 836,423 (322,659)
Prepaid expenses 86,213 (13,867) (56,266)
Accounts payable, customer
prepayments and other current
liabilities 635,263 577,231 609,167
Deferred rent (29,180) 26,072 25,226
---------- --------- ----------
Net cash provided by
(used for) operating
activities 2,625,627 (80,428) 1,625,800
Cash Flows Used for Investing
Activities, purchases of property
and equipment (37,803) (165,516) (489,933)
Cash Flows from Financing Activities,
advances from (payments to) ArcVentures,
Inc., net (2,587,824) 245,944 (1,135,867)
---------- ---------- ----------
Net change in cash - - - - - -
Cash, beginning of year - - - - - -
---------- ---------- ----------
Cash, end of year $ - - $ - - $ - -
========== ========== ==========
The accompanying notes to financial statements are an integral part of these
statements.
<PAGE>
HOME PHARMACY
(A Division of ArcVentures, Inc.)
NOTES TO FINANCIAL STATEMENTS
(NO DATES PER REQUEST)
1. ORGANIZATION AND BASIS OF PRESENTATION:
General
Home Pharmacy, an operating division of ArcVentures, Inc. ("ARC"), is primarily
in the business of operating a mail-order pharmacy. ARC is a wholly owned
subsidiary of ArcVentures Development Corp., which is a wholly owned subsidiary
of Access Health, Inc. Rush-Presbyterian-St. Lukes Medical Center ("RUSH") is
the sole voting member of Access Health, Inc. On September 16, 1995, ARC sold
Home Pharmacy (Note 9).
Basis of Presentation
These financial statements and the related footnotes have been prepared for
purposes of complying with the rules and regulations of the Securities and
Exchange Commission for filings pursuant to the Securities Act of 1933 and the
Securities Exchange Act of 1934.
The accompanying financial statements, for all years presented, include those
assets, liabilities, revenues and expenses (excluding income taxes) directly
attributable to Home Pharmacy's operations. In addition, certain ARC and RUSH
overhead expenses have been allocated to Home Pharmacy and included in the
accompanying statements of revenues and expenses (excluding income taxes) as
related-party allocations. The method of allocating costs has been deemed
reasonable by management (Note 5).
As a result of Home Pharmacy's relationships with its affiliates, the financial
information included herein does not necessarily reflect what the financial
position and results of operations would have been had it operated as a
stand-alone taxable entity during the years covered. Additionally, the
accompanying financial statements may not be indicative of future operations or
financial position.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Inventories
Inventories, primarily consisting of pharmaceutical drugs, are stated at the
lower of cost or market. Cost is determined using the first-in, first-out
method.
<PAGE>
Property and Equipment
Property and equipment are capitalized and stated at cost, net of accumulated
depreciation and amortization. Items of an ordinary maintenance or repair nature
are charged directly to operations. Depreciation and amortization are computed
using the straight-line method over the following estimated useful lives:
Asset Description Life
----------------------------- --------------------
Office and pharmacy equipment 10 years
Minicomputer 5 years
Computer software 3 years
Leasehold improvements Shorter of estimated
useful lives or term
of lease
Customer Prepayments
Prepayments represent advances from customers for future shipments of
pharmaceutical drugs.
Income Taxes
Home Pharmacy is not a separate tax-paying entity and does not have a
tax-sharing agreement with ARC. As such, income taxes have not been allocated to
Home Pharmacy.
Revenue Recognition
Revenue is recognized upon the shipment of pharmaceutical drugs.
3. PROPERTY AND EQUIPMENT:
Property and equipment at June 30 consisted of the following:
1995 1994
---------- ----------
Office and pharmacy equipment $ 825,413 $ 805,761
Minicomputer 223,245 223,245
Computer software 100,000 100,000
Leasehold improvements 80,398 77,698
---------- ----------
1,229,056 1,206,704
Less, accumulated depreciation
and amortization (527,952) (372,780)
---------- ----------
$ 701,104 $ 833,924
========== ==========
4. DEFERRED RENT:
Home Pharmacy's office facility lease contains provisions for a rent-free period
and scheduled rent increases. Deferred rent represents the difference between
recognizing rent expense on a straight-line basis over the lease term and actual
rent paid. This amount will be amortized over the life of the lease.
5. TRANSACTIONS WITH RELATED PARTIES:
Beginning January 1, 1995, ARC assigned certain employees to Home Pharmacy;
prior to that date Home Pharmacy leased its employees from RUSH. ARC and RUSH
pay and provide for the employees' compensation (including all employee fringe
benefits). ARC and RUSH charged Home Pharmacy for the wages and salaries at cost
plus an additional 18% in 1995 and 17% in 1994 and 1993 to cover all employee
fringe benefits. These rates may not be indicative of market rates. Home
Pharmacy bears no ongoing liability for employee benefits as a result of this
leasing arrangement with ARC.
ARC performs certain accounting, legal, communications, data processing,
administrative and other services ("corporate services") that are not
specifically attributable to Home Pharmacy. Charges for corporate services are
allocated to Home Pharmacy on the basis of the underlying cost drivers in each
area. Management believes that the ARC corporate services allocated to Home
Pharmacy are reasonable estimates of the costs of services provided.
<PAGE>
In addition, RUSH provides various services to ARC including accounting, legal,
human resources, insurance and other administrative services ("administrative
services"). RUSH and ARC negotiate the RUSH charges for these services based on
RUSH's cost for providing these services. A portion of the RUSH administrative
charges are then allocated to Home Pharmacy based on the same principles used to
allocate ARC corporate services. Management believes that the RUSH charges
allocated to Home Pharmacy are reasonable estimates of the costs of services
provided.
In 1994 and 1993, ARC participated in a centralized cash management program
administered by RUSH. Cash is sent to RUSH and advances were made by RUSH, as
needed, to cover ARC's cash requirements. On July 1, 1994, ARC established its
own centralized cash management system in which Home Pharmacy participates. Cash
sent to ARC or RUSH and advances made by ARC or RUSH attributable to Home
Pharmacy have been treated as an adjustment to the "Equity-Investment By and
Advances From ArcVentures, Inc." account in the accompanying financial
statements. ARC allocates a portion of its interest expense to Home Pharmacy
based on the ratio of Home Pharmacy's cumulative net cash advances to cumulative
net cash advances for ARC as a whole. Management believes that the allocation of
interest expense is representative of financing costs attributable to Home
Pharmacy and that the methodology used to allocate interest expense is
reasonable.
Home Pharmacy fills mail-order pharmaceutical prescriptions for certain RUSH
employees and bills RUSH at arm's length.
These transactions with related parties are included in the accompanying
statements of revenues and expenses (excluding income taxes). These transactions
(by caption) totaled as follows for the years ended June 30:
1995 1994 1993
---------- ---------- ----------
Related-party transactions:
Net revenues--prescribtion
services for RUSH employees $ 443,159 $ 437,626 $ 490,572
========== ========== ==========
Selling, general and
administration expenses,
leased employee expenses:
ARC 1,434,014 - - - -
RUSH 1,729,073 3,132,163 2,520,807
========== ========== ==========
Related-party expense allocations:
ARC corporate services $ 612,838 $ 477,630 $ 377,284
RUSH administrative services 78,856 108,288 101,075
---------- ---------- ----------
$ 691,694 $ 585,918 $ 478,359
========== ========== ==========
Allocated interest expense
(interest rates at 4.7%, 3.5%,
and 3.7% for 1995, 1994 and
1993, respectively) $ 180,433 $ 168,852 $ 185,049
========== ========== ==========
<PAGE>
6. OPERATING LEASES:
Home Pharmacy's office facilities are leased by ARC. The lease expires in the
year 2000. ARC charges Home Pharmacy monthly based upon its estimated occupancy
costs. Lease expense for the years ended June 30, 1995, 1994 and 1993, was
$242,486, $257,948 and $166,336, respectively. These costs have been deemed
reasonable by management and have been charged to selling, general and
administrative expenses in the accompanying statements of revenues and expenses
(excluding income taxes).
Home Pharmacy's allocation of ARC's future minimum lease payments are $47,000
through September 16, 1995, the date of the Home Pharmacy sale (Note 9).
7. CONCENTRATION OF CREDIT RISK:
Home Pharmacy provides credit, in the normal course of business, to self-insured
corporations, insurers and third-party administrators, entitlement programs,
municipalities and individual patients. Home Pharmacy performs ongoing credit
evaluations of its customers and maintains reserves for potential credit losses.
When realized, these losses have been within management's expectations.
In 1995, three customers accounted for 52% of revenues. In 1994 and 1993, three
and two customers accounted for 56% and 48%, respectively, of revenues.
One of the above customers opted not to renew its contract with Home Pharmacy.
The contract expired in December, 1994. This customer accounted for
approximately 12%, 19% and 17% of Home Pharmacy's revenue during 1995, 1994 and
1993, respectively.
8. COMMITMENTS AND CONTINGENCIES:
In the ordinary course of conducting its business, Home Pharmacy may become
subject to disputes from its customers concerning the distribution of
pharmaceutical drugs. As of June 30, 1995, management believes that there is no
material exposure in this area.
9. SUBSEQUENT EVENT:
On September 16, 1995 Mednet, MPC Corporation (Mednet) acquired certain assets
and assumed certain liabilities of Home Pharmacy for $8,000,000 in cash and two
promissory notes for $2,500,000 and $4,650,000, respectively. The $4,650,000
promissory note is contingent on Home Pharmacy's meeting specified performance
levels. Also, Mednet agreed to purchase the inventory on hand at the closing
date.
<PAGE>
Mednet, MPC Corporation
Pro Forma Consolidated Statement of Operations
As of 12/31/94
Total
---------------
Net Sales ............................................ $119,143,943.28
Cost of Sales ........................................ 102,579,274.54
---------------
Gross Profit ................................ 16,564,668.74
Salaries and Benefits ................................ 8,681,173.29
Marketing & Adver .................................... 1,645,571.44
Other Admin Exp ...................................... 8,065,289.25
---------------
Total SG&A .................................. 18,392,033.98
Operating Inc/(Loss)
Before Deprec & Amort ....................... (1,827,365.24)
Deprec & Amort ....................................... 2,590,202.95
Operating Inc/(Loss) ........................ (4,417,568.19)
Loss for period not owned ............................ 0.00
Debt Conversion Cost ................................. (202,675.00)
Interest Expense ..................................... (484,866.82)
Interest Income ...................................... 48,831.22
Rental Income ........................................ 4,333.20
Other Inc(Exp), Net .................................. 167,047.82
---------------
Total Other Inc(Loss) ....................... (467,329.58)
Net Income(Loss) ............................ $ (4,884,897.77)
===============
<PAGE>
Mednet, MPC Corporation
Pro Forma Consolidated Statement of Operations
For the Nine Months Ending 9/30/95
Total
--------------
Net Sales ............................................ $83,569,507.84
Cost of Sales ........................................ 71,376,773.55
--------------
Gross Profit ................................ 12,192,734.29
Salaries and Benefits ................................ 6,384,795.65
Marketing & Adver .................................... 749,493.55
Other Admin Exp ...................................... 4,086,213.13
--------------
Total SG&A .................................. 11,220,502.33
Operating Inc/(Loss)
Before Deprec & Amort ....................... 972,231.96
Deprec & Amort ....................................... 2,210,720.26
Operating Inc/(Loss) ........................ (1,238,488.30)
Loss for period not owned ............................ 0.00
Debt Conversion Cost ................................. 0.00
Interest Expense ..................................... (688,094.67)
Interest Income ...................................... 30,588.40
Rental Income ........................................ 0.00
Other Inc(Exp), Net .................................. (134,083.67)
--------------
Total Other Inc(Loss) ....................... (791,589.94)
Net Income(Loss) ............................ $(2,030,078.24)
==============
