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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES ACT OF 1934
Date of Report (Date of earliest event reported): MAY 10, 2000
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US DIAGNOSTIC INC.
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
1-13392 11-3164389
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(Commission File Number) (IRS Employer Identification No.)
777 SOUTH FLAGLER DRIVE, WEST PALM BEACH, FLORIDA 33401
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(Address of principal executive offices) (Zip Code)
(561) 832-0006
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
On May 10, 2000, US Diagnostic Inc. announced that its Board of
Directors has approved a restructuring plan which contemplates the sale of all
or substantially all of its imaging centers. The restructuring plan requires
Stockholder approval. Under the restructuring plan, the Company may reinvest
into a new business or businesses the net proceeds from the sale of assets. If
the Company is unable to or chooses not to reinvest in a new business, the plan
authorizes the Board to liquidate the Company through a distribution to
Stockholders. The plan allows the Board to seek, at any time, debt refinancing
as an alternative to the sale of the imaging centers.
Further, the Company and the Board of Directors engaged David McIntosh
(a current director) to direct the review of potential opportunities to
re-deploy the sale proceeds in other ventures including internet and
non-internet companies.
Proxy materials will be mailed to the Stockholders of record at the
close of business on June 2, 2000 for the Annual Meeting of the Stockholders to
be held in July.
US Diagnostic Inc.'s press release is attached hereto as Exhibit 99 and
is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99 Press Release of US Diagnostic Inc. dated May 10, 2000
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
US DIAGNOSTIC INC.
Date: May 10, 2000
By /s/ P. Andrew Shaw
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P. Andrew Shaw
Executive Vice President and
Chief Financial Officer
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EXHIBIT INDEX
EXHIBIT NO.
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99 Press Release of US Diagnostic Inc. dated May 10, 2000
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EXHIBIT 99
US DIAGNOSTIC INC. (LOGO)
INVESTOR CONTACT:
Investor Relations
(561) 832-0006
website: www.usdl.com
FOR IMMEDIATE RELEASE
US DIAGNOSTIC INC. ANNOUNCES RESTRUCTURING PLAN
SUBJECT TO STOCKHOLDER APPROVAL
WEST PALM BEACH, FLORIDA, MAY 10, 2000 - US Diagnostic Inc. (NASDAQ
Small Cap: USDL) today announced that its Board of Directors has approved a
restructuring plan which contemplates the sale of all or substantially all of
its imaging centers. The restructuring plan requires Stockholder approval. Under
the restructuring plan, the Company may reinvest into a new business or
businesses the net proceeds from the sale of assets. If the Company is unable to
or chooses not to reinvest in a new business, the plan authorizes the Board to
liquidate the Company through a distribution to Stockholders. The plan allows
the Board to seek, at any time, debt refinancing as an alternative to the sale
of the imaging centers.
Joseph A. Paul, President and Chief Executive Officer stated that, "The
restructuring plan was the result of careful consideration of the Company's
alternatives. Despite the Company's debt and expense reduction program
implemented in 1998 and 1999, US Diagnostic Inc. remains burdened by a
significant amount of debt with short maturities, high interest and substantial
current amortization payments. While we believe that cash flow from operations
continues to grow, the business is too highly leveraged to pursue an aggressive
growth program of acquisitions and new center openings. This situation led the
Company to engage, in 1999, Lehman Brothers and River Capital Partners to assist
the Board of Directors in assessing the Company's capital raising and strategic
alternatives. These alternatives included a sale or merger of the Company in its
entirety, sale of individual centers, refinancing the Company's debt and an
equity infusion from private equity sources. Based upon this assessment, the
weak condition of the public markets for debt and equity of health care service
companies, the Company's need for liquidity and the expression of interests from
buyers in individual centers, the Board of Directors concluded that the
restructuring plan is the most appropriate course of action for the Company."
Further, the Company and the Board of Directors engaged David McIntosh
(a current director) to direct the review of potential opportunities to
re-deploy the sale proceeds in other ventures including internet and
non-internet companies.
Proxy materials will be mailed to Stockholders of record at the close
of business on June 2, 2000 for the Annual Meeting of the Stockholders to be
held in July.
US Diagnostic Inc. is a leading independent provider of radiology
services focused on the development, acquisition, operation and management of
multi-modality diagnostic imaging centers and related medical facilities in the
United States. The Company has locations in 13 states and owns, operates or
manages 79 fixed site diagnostic imaging facilities.
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STATEMENTS CONTAINED IN THIS PRESS RELEASE WHICH ARE NOT HISTORICAL
FACTS ARE FORWARD LOOKING STATEMENTS AS THAT TERM IS DEFINED IN THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995. THESE FORWARD-LOOKING STATEMENTS ARE
BASED LARGELY ON THE COMPANY'S EXPECTATIONS AND ARE SUBJECT TO A NUMBER OF RISKS
AND UNCERTAINTIES, INCLUDING BUT NOT LIMITED TO ECONOMIC, COMPETITIVE AND OTHER
FACTORS AFFECTING THE COMPANY'S OPERATIONS, MARKETS AND STRATEGIES, ADEQUATE
COLLECTION OF ACCOUNTS RECEIVABLE, AVAILABLE FINANCING, GOVERNMENT REGULATIONS
INVOLVING THE COMPANY, FACTS AND EVENTS NOT KNOWN AT THE TIME OF THIS PRESS
RELEASE, AND OTHER FACTORS DISCUSSED IN THE COMPANY'S FILINGS WITH THE
SECURITIES AND EXCHANGE COMMISSION. MANY OF THESE FACTORS ARE BEYOND THE
COMPANY'S CONTROL. ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THE
FORWARD-LOOKING STATEMENTS. IN LIGHT OF THESE RISKS AND UNCERTAINTIES, THERE CAN
BE NO ASSURANCE THAT THE RESULTS ANTICIPATED IN THE FORWARD-LOOKING INFORMATION
IN THIS PRESS RELEASE WILL, IN FACT, OCCUR.
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