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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
January 12, 1998
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Date of Report (Date of earliest event reported)
UNITED AMERICAN HEALTHCARE CORPORATION
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(Exact name of registrant as specified in its charter)
Michigan 000-18839 38-2526913
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1155 Brewery Park Boulevard, Suite 200, Detroit, Michigan 48207
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (313) 393-0200
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Not Applicable
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(Former name or former address, if changed since last report)
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FORM 8-K
Item 4. Changes in Registrant's Certifying Accountant.
Registrant selected Arthur Andersen LLP as its principal accountant to
audit its financial statements for the fiscal year ending June 30, 1998.
Thereafter, Registrant engaged Arthur Andersen LLP to assist it in developing
and implementing a financial restructuring program for Registrant, and
Registrant selected Mr. Thomas J. Allison, the head of Arthur Andersen LLP's
Corporate Recovery Services Group, in his individual capacity, as Registrant's
interim Chief Financial Officer. In view of the consulting services to be
provided to Registrant by Arthur Andersen LLP and the selection of Mr. Allison
as the interim Chief Financial Officer of Registrant, Arthur Andersen LLP no
longer has the independence required to serve Registrant in the capacity of
auditor. Therefore, on January 12, 1998, the Board of Directors of Registrant,
upon the recommendation of its Audit Committee, notified Arthur Andersen LLP
that Registrant would not engage Arthur Andersen LLP to audit Registrant's
financial statements.
Arthur Andersen LLP has not, performed any work, nor issued any report on
Registrant's financial statements for either of the past two years, thus it has
not included, in either of the past two years, an adverse opinion or a
disclaimer of opinion, or a qualification or modification as to uncertainty,
audit scope or accounting principles, with respect to financial statements of
Registrant. A copy of this Form 8-K has been provided to Arthur Andersen LLP.
There were no disagreements with Arthur Andersen LLP during Registrant's
two most recent fiscal years and the subsequent interim period preceding Arthur
Andersen's dismissal on any matters of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure.
On January 12, 1998, Registrant's Board of Directors, upon the
recommendation of its Audit Committee, engaged KPMG Peat Marwick LLP as
Registrant's principal accountant to audit its financial statements for the
fiscal year ending June 30, 1998. Previously, KPMG Peat Marwick LLP audited
Registrant's subsidiary, UltraMedix Health Care System, Inc.
Item 5. Other Events.
On January 12, 1998, Registrant announced its adoption of a restructuring
program. A press release describing such program is incorporated herein by
this reference.
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Item 7. Financial Statements and Exhibits.
(c) Exhibits.
1. Concurring Letter regarding change in Certifying Accountants dated
January 16, 1998, from Arthur Andersen LLP.
2. Press Release dated January 12, 1998.
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this Report to be signed on its behalf
by the undersigned hereunto duly authorized.
UNITED AMERICAN HEALTHCARE CORPORATION
By: /s/ Jagu Vanahararum
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Jagu Vanahararum
Senior Vice President -
Finance and Treasurer
Dated: January 20, 1998
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EXHIBIT INDEX
Item No. Exhibit
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16 Concurring Letter regarding
change in Certifying Accountants
dated January 16, 1998,
from Arthur Andersen LLP
99 Press Release of United
American Healthcare
Corporation
dated January 12, 1998
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EXHIBIT 16
ARTHUR ANDERSEN LLP
[Letterhead]
January 16, 1998
Securities and Exchange Commission
To Whom It May Concern:
We have read the first three paragraphs of Item 4 included in the attached Form
8-K dated January 12, 1998 of United American Healthcare Corporation to be
filed with the Securities and Exchange Commission and are in agreement with the
statements contained therein.
Very truly yours,
/s/ Arthur Andersen LLP
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EXHIBIT 99
PRESS RELEASE
January 12, 1998
United American Healthcare Corporation Announces Restructuring Program
United American Healthcare Corporation (NYSE: UAH) announced today that
William C. Brooks has been named Chairman of the Board of the Company. Brooks
will serve in a non-executive capacity, overseeing the company's financial
restructuring efforts.
Day-to-day operations of United American will continue to be managed by
Dr. Julius Combs, the chief executive officer of the company, and Ronald R.
Dobbins, president and chief operating officer of the company.
The company recently engaged Arthur Andersen, LLP to assist in developing
and implementing a financial restructuring program for the company, and has
named Thomas J. Allison of Arthur Andersen to serve as interim chief financial
officer of the company. Allison is the head of Arthur Andersen's Corporate
Recovery Services group based in Chicago.
Brooks stated: "The board of directors of United American has adopted a
financial restructuring plan, developed by Arthur Andersen and endorsed by the
board of directors' audit committee, which is designed to cut the company's
cash losses and position the company for profitable operations." Brooks said
he accepted the position of chairman of the board to "personally oversee
implementation of the plan."
Brooks said that under the restructuring plan the company intends to
discontinue a number of expansion projects, reduce non-core spending
activities, reduce corporate overhead and sell the Corporate Healthcare
Financing, Inc. subsidiary. He said the Company will also seek to negotiate an
extension of its bank credit facilities.
Allison said that restructuring charges will result from these activities.
However, the company is not in a position at this time to estimate the amount
of such charges. Allison said that such charges will be in addition to
significant operating losses the company expects to incur during the current
quarter, which ends March 31. Allison said that "whether the company will
operate profitably in the fourth quarter will depend on the ability of the
company to implement the restructuring program, including the divestiture of
non-core subsidiaries."
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In a related development, Brooks said that United American has selected
KPMG Peat Marwick LLP as its auditor. Arthur Andersen was approved at the 1997
annual shareholders meeting to audit the company and its subsidiaries.
However, in view of the consulting services now being provided to the company
by Arthur Andersen, and Allison's service as chief financial officer of the
company, Arthur Andersen no longer has the independence required for the firm
to serve in the capacity of auditor, Brooks said.
Brooks has been a director of the company since September 1997. He
retired in 1997 from General Motors Corporation, as vice president - corporate
affairs, after serving in various executive positions at General Motors since
1973. Brooks also serves as chairman of Entech Human Resources Services, Inc.
and as a director of Louisiana - Pacific, Inc. (NYSE: LaPac) and DTE Energy
Company and Detroit Edison Company (NYSE: LPX) and DET Energy Company and
Detroit Edison Company. Brooks is currently the chairman of the Detroit
Regional Chamber of Commerce. He served in the Bush Administration as
assistant secretary of labor and, by appointment of President Clinton, Brooks
serves on the seven-member Social Security Advisory Board.
United American Healthcare (UAH) is a full service health care management
company. It manages three HMOs under long-term contracts.
Certain statements in this release constitute "forward looking statements"
within the meaning of the federal securities laws. These forward-looking
statements can generally be identified as such because the context of the
statement will include words such as "believes," "expects," "anticipates" or
words of similar import. Such statements involve known and unknown risks and
uncertainties which may cause the company's actual results, performance or
achievements to be materially different than any future results, performance or
achievements implied in this release. Investors are cautioned that all
forward-looking statements involve risks and uncertainty.
CONTACT: Thomas Allison, Chief Financial Officer, United American Healthcare
Corporation, 313-393-0200
