Delaware | 88-0464853 | |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification Number) |
Common Stock, $0.0001 par value | Nasdaq Global Market | |
(Title of each class) | (Name of each exchange on which registered) |
Large accelerated | Accelerated filer þ | Non-accelerated filer o |
Exhibit | 10.13 | |||||||
Exhibit | ||||||||
10.15 | ||||||||
Exhibit 21.1 | ||||||||
Exhibit 23.1 | ||||||||
Exhibit 23.2 | ||||||||
Exhibit 31.1 | ||||||||
Exhibit 31.2 | ||||||||
Exhibit 32.1 | ||||||||
Exhibit 32.2 | ||||||||
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· | A comprehensive physical examination, including specific laboratory tests, prior to initiation of treatment by the treating physician, to determine if the patient is appropriate for |
· | Prescription medications delivered in a unique dosing algorithm |
· | A nutritional plan and recommendations, designed to help facilitate and maintain the other aspects of recovery |
· | One month of prescription medications and nutritional supplements following the initial treatment |
· | Individualized psychosocial counseling or other recovery oriented counseling |
Treatment Programs may be associated with higher initial completion rates than conventional treatments, reduce cravings which can be a major factor in relapse and allow patients to more quickly engage in counseling or other forms of psychosocial therapy in a meaningful way. |
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· | The PROMETA Treatment |
· | The PROMETA |
· | Treatment using the PROMETA |
· | The PROMETA |
· | Providing our substance abuse disease management program to managed care health plans for reimbursement on a case rate or capitated basis, utilizing the CompCare infrastructure to provide some components of our services |
· | Demonstrating the potential for improved clinical outcomes and cost effectiveness associated with using the PROMETA Treatment Programs, through commercial pilot studies with key managed care and other third-party payers |
· | Expanding the base of our self-pay licensed treatment sites and managed treatment centers, focusing primarily on existing service areas |
· | Seeking additional scientific and clinical research data to further validate the benefits of using the PROMETA Treatment Programs, through unrestricted grants for research studies by leading research institutions and preeminent researchers in the field of alcohol and substance abuse |
· | Exploring opportunities in foreign markets |
· | Increased worker productivity, by reducing workplace absenteeism, compensation claims, and job related injuries |
· | Decreased emergency room and inpatient utilization |
· | Decreased readmission rates |
· | Medical cost savings |
· | An 88-patient randomized, double-blind, placebo-controlled study of the PROMETA Treatment Program’s acute and immediate effects on cravings and cognition in methamphetamine dependent subjects designed and supervised by Harold Urschel, M.D., completed in October 2007. Top line results showed a statistically significant reduction in cravings versus placebo. |
· | A 50-patient open-label study of the physiological component of the PROMETA Treatment Program for methamphetamine dependence conducted by Dr. Urschel that was completed in 2006, in which it was reported that more than 80% of study participants experienced a significant clinical benefit—measured through decrease in cravings, reduction of methamphetamine use and treatment retention—after treatment, with no adverse events. The results of this study were reported in October 2007 in a peer-reviewed journal, Mayo Clinic Proceedings. |
· | A 30-patient open label randomized controlled study of the PROMETA Treatment Programs in the treatment of alcohol dependence being conducted by Jeffery Wilkins, M.D., at Cedars-Sinai Medical Center in Los Angeles completed in August 2007. Top line results reported at 30 days showed a 94% decrease in median cravings and an 82% reduction in mean percentage of total drinking days. |
· | In February 2007, Sheryl Smith, Ph.D., a leading researcher in the field of neurosteroids, provided evidence supporting a mechanism of action underlying our PROMETA Treatment Programs at the Neurobiology of Addiction Conference. Dr. Smith presented data from her research on methamphetamine dependent rats, describing the methamphetamine induced increase in the α4 subunit of the GABAA receptor and the post-treatment decrease of this pathological marker, which has been associated with states of hyper-excitability and anxiety. This receptor dysregulation and associated symptomatology has previously been associated with alcohol and neurosteroid withdrawal in animal studies, and suggests a common cause of cravings in substance dependent individuals. |
· | An ongoing 60-patient randomized, double-blind, placebo-controlled study of the PROMETA Treatment Program’s acute and immediate effects on cravings and cognition in alcohol dependent subjects designed and being supervised by renowned alcoholism researcher, Joseph R. Volpicelli, M.D., of University of Pennsylvania, and conducted by Institute of Addiction Medicine’s Dr. Jenny Starosta. |
· | An ongoing 90-patient multi-site, randomized, double-blind, placebo-controlled study of the PROMETA Treatment Programs for the treatment of methamphetamine dependence being conducted by Walter Ling, M.D., of UCLA. |
· | An ongoing 60–patient, randomized, double-blind, placebo-controlled study of the PROMETA Treatment Program for the initiation and extension of abstinence of alcoholism being conducted by Raymond Anton, M.D., at Medical University of South Carolina. |
· | An 80–patient, randomized, double-blind, placebo-controlled study of the PROMETA Treatment Programs’ acute and immediate effects on cravings and cognition in alcohol dependent subjects being conducted by Dr. Wilkins at Cedars-Sinai Medical Center. |
· | Detoxification, which is typically conducted in medically directed and supervised environments |
· | Rehabilitation, which is often conducted through short- or long-term therapeutic facilities or programs, most of which do not offer medical management options |
· | Relapse prevention/aftercare that is provided via structured outpatient treatment programs. |
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· | The addiction medication naltrexone, an opiate receptor antagonist, is marketed by a number of generic pharmaceutical companies as well as under the trade name ReVia®, for treatment of alcohol |
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· | |||
VIVITROL®, an extended release formulation of naltrexone |
· | |||
Campral® Delayed-Release Tablets (acamprosate calcium), |
· | Topiramate (Topamax), a drug manufactured by Ortho-McNeill Jannssen, which is approved for the treatment of seizures. A multi-site clinical trial reported in October 2007 found that topiramate significantly reduced heavy drinking days in alcohol-dependent individuals. |
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· | Hythiam® | ||
· | PROMETA® |
· | PROMETA Center® |
· | Catasys™ |
· | The Science of Recovery® |
Name | Position | Age | ||
Terren S. Peizer | Chief Executive Officer | 48 | ||
Richard A. Anderson | Senior Executive Vice President | 38 | ||
Christopher S. Hassan | Senior Executive Vice President | 47 | ||
Anthony M. LaMacchia | Senior Executive Vice President | 54 | ||
Chuck Timpe | Chief Financial Officer | |||
61 |
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· | the addiction medication naltrexone, an opiate receptor antagonist, is marketed by a number of generic pharmaceutical companies as well as under the trade name ReVia®, for treatment of alcohol |
· | |||
VIVITROL®, |
· | |||
Campral® Delayed-Release Tablets (acamprosate calcium), an NMDA receptor antagonist taken two to three times per day on a chronic or long-term |
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· | Topiramate (Topamax), a drug manufactured by Ortho-McNeill Jannssen, which is approved for the treatment of seizures. A multi-site clinical trial reported in October 2007 found that tropiramate significantly reduced heavy drinking days in alcohol-dependent individuals. |
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· | announcements of new products or services by us or our competitors; current events affecting the political, economic and social situation in the United States and other countries where we operate; |
· | trends in our industry and the markets in which we operate; |
· | changes in financial estimates and recommendations by securities analysts; |
· | acquisitions and financings by us or our competitors; |
· | the gain or loss of a significant customer; |
· | quarterly variations in operating results; |
· | volatility in exchanges rate between the US dollar and the currencies of the foreign countries in which we operate; |
· | the operating and stock price performance of other companies that investors may consider to be comparable; and |
· | purchases or sales of blocks of our securities. |
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Location | Use | Approximate Area in Square Feet | ||||
11150 and 11100 Santa Monica Blvd. Los Angeles, California | Principal executive and administrative offices | 20,000 | ||||
1315 Lincoln Blvd. Santa Monica, California | Medical office space for The PROMETA Center, Inc. | 5,400 | ||||
1700 Montgomery St. San Francisco, California | Medical office space for The PROMETA Center, Inc. | 4,000 |
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ITEM 5. | MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS |
Closing Sales Prices | ||||||||
2006 | High | Low | ||||||
4th Quarter | $ | 9.35 | $ | 6.20 | ||||
3rd Quarter | $ | 7.63 | $ | 4.77 | ||||
2nd Quarter | $ | 9.04 | $ | 6.52 | ||||
1st Quarter | $ | 9.19 | $ | 5.42 |
2005 | High | Low | ||||||
4th Quarter | $ | 6.85 | $ | 4.45 | ||||
3rd Quarter | $ | 7.30 | $ | 5.12 | ||||
2nd Quarter | $ | 8.54 | $ | 4.95 | ||||
1st Quarter | $ | 9.02 | $ | 5.24 |
Closing Sales Prices | ||||||||
2007 | High | Low | ||||||
4th Quarter | $ | 8.64 | $ | 2.68 | ||||
3rd Quarter | $ | 8.77 | $ | 6.43 | ||||
2nd Quarter | $ | 8.71 | $ | 6.53 | ||||
1st Quarter | $ | 10.21 | $ | 6.48 | ||||
2006 | High | Low | ||||||
4th Quarter | $ | 9.35 | $ | 6.20 | ||||
3rd Quarter | $ | 7.63 | $ | 4.77 | ||||
2nd Quarter | $ | 9.04 | $ | 6.52 | ||||
1st Quarter | $ | 9.19 | $ | 5.42 |
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Period from | ||||||||||||||||
February 13, | ||||||||||||||||
2003 to | ||||||||||||||||
December 31, | December | |||||||||||||||
(In thousands, except per share amounts) | 2006 | 2005 | 2004 | 31, 2003 | ||||||||||||
Statement of Operations Data: | ||||||||||||||||
Revenues | $ | 3,906 | $ | 1,164 | $ | 192 | $ | 75 | ||||||||
Loss from operations | (39,926 | ) | (24,872 | ) | (11,945 | ) | (3,545 | ) | ||||||||
Net loss | (38,298 | ) | (24,038 | ) | (11,775 | ) | (3,504 | ) | ||||||||
Loss Per Share: | ||||||||||||||||
Net loss per share — basic and diluted | $ | (0.96 | ) | $ | (0.77 | ) | $ | (0.47 | ) | $ | (0.21 | ) | ||||
Weighted average shares outstanding — basic and diluted | 39,715 | 31,173 | 24,877 | 16,888 | ||||||||||||
Cash Flows Data: | ||||||||||||||||
Net cash used in operating activities | $ | (28,431 | ) | $ | (18,789 | ) | $ | (9,947 | ) | $ | (1,374 | ) | ||||
Net cash provided by (used in) investing activities | 4,662 | (22,236 | ) | (10,913 | ) | (16,527 | ) | |||||||||
Net cash provided by financing activities | 26,053 | 40,442 | 21,416 | 21,345 |
Period from | ||||||||||||||||||||||||||||||||||||||
February 13, | ||||||||||||||||||||||||||||||||||||||
(In thousands, except per share amounts) | 2003 to | |||||||||||||||||||||||||||||||||||||
December 31, | December | |||||||||||||||||||||||||||||||||||||
2007 | 2006 | 2005 | 2004 | 31, 2003 | ||||||||||||||||||||||||||||||||||
Statement of Operations Data: | ||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Behavioral health managed care services | $ | 36,306 | (a) | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||
Healthcare services | 7,695 | 3,906 | 1,164 | 192 | 75 | |||||||||||||||||||||||||||||||||
Total revenues | 44,001 | 3,906 | 1,164 | 192 | 75 | |||||||||||||||||||||||||||||||||
Loss from operations | (47,531 | ) | (d) | (39,926 | ) | (24,872 | ) | (e) | (11,945 | ) | (3,545 | ) | ||||||||||||||||||||||||||
Loss on extingishment of debt | (741 | ) | (b) | |||||||||||||||||||||||||||||||||||
Change in fair value of warrant liability | 3,471 | (c) | - | - | - | - | ||||||||||||||||||||||||||||||||
Net loss | (45,462 | ) | (38,298 | ) | (24,038 | ) | (11,775 | ) | (3,504 | ) | ||||||||||||||||||||||||||||
Loss Per Share: | ||||||||||||||||||||||||||||||||||||||
Net loss per share - basic and diluted | $ | (0.99 | ) | $ | (0.96 | ) | $ | (0.77 | ) | $ | (0.47 | ) | $ | (0.21 | ) | |||||||||||||||||||||||
Weighted average shares outstanding - basic and diluted | 45,695 | 39,715 | 31,173 | 24,877 | 16,888 | |||||||||||||||||||||||||||||||||
Cash Flows Data: | ||||||||||||||||||||||||||||||||||||||
Net cash used in operating activities | $ | (39,220 | ) | $ | (28,499 | ) | $ | (18,819 | ) | $ | (9,947 | ) | $ | (1,374 | ) | |||||||||||||||||||||||
Net cash provided by (used in) investing activities | (4,091 | ) | 4,730 | (22,206 | ) | (10,913 | ) | (16,527 | ) | |||||||||||||||||||||||||||||
Net cash provided by financing activities | 48,759 | 26,053 | 40,442 | 21,416 | 21,345 | |||||||||||||||||||||||||||||||||
As of December 31, | As of December 31, | |||||||||||||||||||||||||||||||||||||
2006 | 2005 | 2004 | 2003 | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and marketable securities | $ | 43,447 | $ | 47,000 | $ | 27,479 | $ | 16,640 | ||||||||||||||||||||||||||||||
Cash, cash equivalents and marketable | ||||||||||||||||||||||||||||||||||||||
securities | $ | 46,989 | $ | 43,447 | $ | 47,000 | $ | 27,479 | $ | 16,640 | ||||||||||||||||||||||||||||
Total current assets | 44,549 | 47,720 | 28,093 | 17,344 | 50,342 | 44,549 | 47,720 | 28,093 | 17,344 | |||||||||||||||||||||||||||||
Total assets | 52,205 | 54,462 | 33,962 | 22,580 | 70,646 | 52,205 | 54,462 | 33,962 | 22,580 | |||||||||||||||||||||||||||||
Capital lease obligations | 227 | — | — | — | ||||||||||||||||||||||||||||||||||
Short-term debt | 4,742 | - | - | - | - | |||||||||||||||||||||||||||||||||
Long-term debt | 2,057 | (a) | - | - | - | - | ||||||||||||||||||||||||||||||||
Warrant liability | 2,798 | (c) | - | - | - | - | ||||||||||||||||||||||||||||||||
Total liabilities | 10,176 | 4,723 | 2,128 | 2,092 | 27,382 | 10,176 | 4,723 | 2,128 | 2,092 | |||||||||||||||||||||||||||||
Stockholders’ equity | 42,029 | 49,739 | 31,834 | 20,488 | 43,264 | 42,029 | 49,739 | 31,834 | 20,488 | |||||||||||||||||||||||||||||
Book value per share | 0.96 | 1.27 | 1.07 | 0.83 | 0.80 | 0.96 | 1.27 | 1.07 | 0.83 | |||||||||||||||||||||||||||||
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(a) | We began consolidating CompCare’s operations on January 13, 2007. See further discussion in Note 5 –Acquisition of Woodcliff. |
(b) | The $741,000 loss on extinguishment of debt resulted from a $5 million redemption of the Highbridge senior secured notes on November 7, 2007. See further discussion in Note 7 – Debt Outstanding. |
(c) | The fair value of warrants issued in conjunction with the registered direct placement on November 7, 2007 was accounted for as a liability and was revalued at $2.8 million at December 31, 2007, resulting in a $3.5 million non-operating gain. |
(d) | Includes a $2.4 million impairment loss related to the non-cash stock settlement reached with XINO Corporation in August 2007. See further discussion in Note 6 – Intangible Assets. |
(e) | We recorded an impairment charge of $272,000 in December 2005 to fully write off the cost of a patent for opiate addiction treatment. See further discussion in Note 6 – Intangible Assets. |
ITEM 7. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
· | Providing our substance abuse disease management program to managed care health plans for reimbursement on a case rate or capitated basis, utilizing the CompCare infrastructure to provide |
· | Demonstrating the potential for improved clinical outcomes and cost effectiveness associated with using the PROMETA Treatment Programs, through commercial pilot studies with key managed care |
· | Expanding the base of our self-pay licensed treatment sites and managed medical treatment centers, focusing primarily on existing service areas |
· | Seeking additional scientific and clinical research data to further validate the efficacy of using the PROMETA |
· | Exploring opportunities in foreign markets |
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Year Ended December 31, | ||||||||||||
(In thousands) | 2006 | 2005 | 2004 | |||||||||
Revenues | ||||||||||||
U.S. licensees | $ | 2,650 | $ | 1,105 | $ | 192 | ||||||
PROMETA Center | 1,137 | 59 | — | |||||||||
Other revenues | 119 | — | — | |||||||||
Total revenues | 3,906 | 1,164 | 192 | |||||||||
Operating expenses | ||||||||||||
Cost of services | 818 | 134 | 17 | |||||||||
General and administrative expenses | ||||||||||||
Salaries and benefits | 16,212 | 9,204 | 5,117 | |||||||||
Other expenses | 22,468 | 13,173 | 6,156 | |||||||||
Research and development | 3,053 | 2,646 | 177 | |||||||||
Depreciation and amortization | 1,281 | 879 | 670 | |||||||||
Total operating expenses | 43,832 | 26,036 | 12,137 | |||||||||
Loss from operations | (39,926 | ) | (24,872 | ) | (11,945 | ) | ||||||
Interest income | 1,630 | 834 | 171 | |||||||||
Loss before provision for income taxes | $ | (38,296 | ) | $ | (24,038 | ) | $ | (11,774 | ) | |||
Patients treated | ||||||||||||
U.S. licensees | 427 | 207 | 40 | |||||||||
PROMETA Center | 140 | 9 | — | |||||||||
Average revenue per patient treated | ||||||||||||
U.S. licensees | $ | 6,206 | $ | 5,337 | $ | 4,800 | ||||||
PROMETA Center | 8,121 | 6,564 | — |
(In thousands) | Year Ended December 31, 2007 | |||||||||||
2007 | 2006 | 2005 | ||||||||||
Revenues | ||||||||||||
Behavioral health managed care services | $ | 36,306 | $ | - | $ | - | ||||||
Healthcare services | 7,695 | 3,906 | 1,164 | |||||||||
Total revenues | 44,001 | 3,906 | 1,164 | |||||||||
Operating Expenses | ||||||||||||
Behavioral health managed care expenses | 35,679 | - | - | |||||||||
Cost of healthcare services | 2,052 | 818 | 134 | |||||||||
General and administrative expenses | 45,554 | 38,680 | 22,105 | |||||||||
Impairment loss | 2,387 | - | 272 | |||||||||
Research and development | 3,358 | 3,053 | 2,646 | |||||||||
Depreciation and amortization | 2,502 | 1,281 | 879 | |||||||||
Total operating expenses | 91,532 | 43,832 | 26,036 | |||||||||
Loss from operations | (47,531 | ) | (39,926 | ) | (24,872 | ) | ||||||
Interest income | 1,584 | 1,630 | 834 | |||||||||
Interest expense | (2,190 | ) | - | - | ||||||||
Loss on extinguishment of debt | (741 | ) | - | - | ||||||||
Change in fair value of warrant liability | 3,471 | - | - | |||||||||
Other non-operating expense, net | 32 | - | - | |||||||||
Loss before provision for income taxes | $ | (45,375 | ) | $ | (38,296 | ) | $ | (24,038 | ) |
Year Ended December 31, | ||||||||||||
(In thousands) | 2007 | 2006 | 2005 | |||||||||
Healthcare services | $ | (41,270 | ) | $ | (38,296 | ) | $ | (24,038 | ) | |||
Behavioral health managed care services | (4,105 | ) | - | - | ||||||||
Loss before provision for income taxes | $ | (45,375 | ) | $ | (38,296 | ) | $ | (24,038 | ) | |||
(In thousands, except patient treatment data) | December 31, | |||||||||||
2007 | 2006 | 2005 | ||||||||||
Revenues | ||||||||||||
U.S. licensees | $ | 3,807 | $ | 2,650 | $ | 1,105 | ||||||
Managed treatment centers (a) | 2,416 | 1,137 | 59 | |||||||||
Other revenues | 1,472 | 119 | - | |||||||||
Total revenues | 7,695 | 3,906 | 1,164 | |||||||||
Operating Expenses | ||||||||||||
Cost of healthcare services | 2,052 | 818 | 134 | |||||||||
General and administrative expenses | ||||||||||||
Salaries and benefits | 21,272 | 16,212 | 9,204 | |||||||||
Other expenses | 20,561 | 22,468 | 12,901 | |||||||||
Impairment loss | 2,387 | - | 272 | |||||||||
Research and development | 3,358 | 3,053 | 2,646 | |||||||||
Depreciation and amortization | 1,578 | 1,281 | 879 | |||||||||
Total operating expenses | 51,208 | 43,832 | 26,036 | |||||||||
Loss from operations | (43,513 | ) | (39,926 | ) | (24,872 | ) | ||||||
Interest income | 1,439 | 1,630 | 834 | |||||||||
Interest expense | (1,926 | ) | - | - | ||||||||
Loss on extinguishment of debt | (741 | ) | - | - | ||||||||
Change in fair value of warrant liability | 3,471 | - | - | |||||||||
Loss before provision for income taxes | $ | (41,270 | ) | $ | (38,296 | ) | $ | (24,038 | ) | |||
PROMETA Patients Treated | ||||||||||||
U.S. licensees | 559 | 427 | 207 | |||||||||
Managed treatment centers (a) | 239 | 140 | 9 | |||||||||
Other | 124 | 15 | - | |||||||||
922 | 582 | 216 | ||||||||||
Average revenue per PROMETA patient treated (b) | ||||||||||||
U.S. licensees | $ | 5,444 | $ | 5,915 | $ | 5,337 | ||||||
Managed treatment centers (a) | 8,840 | 8,121 | 6,564 | |||||||||
Other | 5,810 | 2,463 | - | |||||||||
Overall average | 6,374 | 6,357 | 5,388 |
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(Dollar amounts in thousands) | For the period January 13 through December 31, | ||
2007 | |||
Revenues | |||
Capitated contracts | $ | 35,226 | |
Non-capitated contracts | 1,080 | ||
Total revenues | 36,306 | ||
Operating Expenses | |||
Claims expense | 29,041 | ||
Other behavioral health managed care services expense | 6,638 | ||
Total healthcare operating expense | 35,679 | ||
General and administrative expenses | 3,721 | ||
Depreciation and amortization | 923 | ||
Loss from operations | (4,017 | ) | |
Other non-operating income, net | 32 | ||
Interest income | 143 | ||
Interest expense | (263 | ) | |
Loss before provision for income taxes | $ | (4,105 | ) |
Total membership | 1,025,000 | ||
Medical Loss Ratio (1) | 82 | % |
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Date | Transaction Type | Amount | ||||
Sep 2003 | Private Placement | $ | 21.3 | |||
Dec 2004 | Private Placement | 21.3 | ||||
Nov 2005 | Public Offering | 40.2 | ||||
Dec 2006 | Private Placement | 24.4 | ||||
$ | 107.2 | |||||
Date | Transaction Type | Amount | ||
September 2003 | Private Placement | $ 21.3 | ||
December 2004 | Private Placement | 21.3 | ||
November 2005 | Public Offering | 40.2 | ||
December 2006 | Private Placement | 24.4 | ||
November 2007 | Registered Direct Placment | 42.8 | ||
$ 150.0 |
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· | the right to |
· | dividend and liquidation preferences, and |
· | anti-dilution protection. |
· | any sale or merger involving a material portion of assets or business |
· | any single or series of related transactions in excess of $500,000, and |
· | incurring any debt in excess of $200,000. |
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Less than 1 | More than 5 | |||||||||||||||||||
Contractual Obligations | Total | year | �� | 1 - 3 years | 3 - 5 years | years | ||||||||||||||
Operating lease obligations (1) | $ | 4,912 | $ | 1,158 | $ | 2,435 | $ | 1,316 | $ | 3 | ||||||||||
Contractual commitments for clinical studies | 5,900 | 5,185 | 715 | — | — | |||||||||||||||
Capital lease obligations | 292 | 67 | 133 | 92 | — | |||||||||||||||
Other Liabilities | 94 | 47 | 47 | — | — | |||||||||||||||
$ | 11,198 | $ | 6,457 | $ | 3,330 | $ | 1,408 | $ | 3 | |||||||||||
Contractual Obligations | Total | Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | ||||||||||
Long-term debt obligations, including interest | $ | 8,434 | $ | 5,290 | $ | 3,144 | $ | - | $ | - | |||||
Claims payable (1) | 5,464 | 5,464 | - | - | - | ||||||||||
Reinsurance claims payable (2) | 2,526 | - | 2,526 | - | - | ||||||||||
Capital lease obligations | 607 | 231 | 297 | 79 | - | ||||||||||
Operating lease obligations (3) | 4,643 | 1,624 | 2,611 | 408 | - | ||||||||||
Contractual commitments for clinical studies | 4,150 | 4,150 | - | - | - | ||||||||||
$ | 25,824 | $ | 16,759 | $ | 8,578 | $ | 487 | $ | - |
(1) | These claim liabilities represent the best estimate of benefits to be paid under capitated contracts and consist of reserves for claims and IBNR. Because of the nature of such contracts, there is typically no minimum contractual commitment associated with covered claims. Both the amounts and timing of such payments are estimates, and the actual claims paid could differ from the estimated amounts presented. |
(2) | This item represents a liability relating to denied claims for a terminated reinsurance contract. Any adjustment to the reinsurance claims liability subsequent to December 31, 2007 would be accounted for in our statement of operations in the period in which the adjustment is determined. |
(3) | Operating lease commitments for our and CompCare’s corporate office facilities, |
· | Changes in utilization patterns |
· | Changes in healthcare costs |
· | Changes in claims submission timeframes by providers |
· | Success in renegotiating contracts with healthcare providers |
· | Adverse selection |
· | Changes in benefit plan design |
· | The impact of present or future state and federal regulations |
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· | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
· | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made only in accordance with authorizations of our management and our board of directors; and |
· | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. |
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Exhibit No. | Description | ||
3.1 | Certificate of Incorporation of Hythiam, Inc., a Delaware corporation, filed with the Secretary of State of Delaware on September 29, 2003(1) | ||
3.2 | By-Laws of Hythiam, Inc., a Delaware corporation(1) | ||
4.1 | Specimen Common Stock Certificate(3) | ||
10.1* | 2003 Stock Incentive Plan(1) | ||
10.2* | Employment Agreement of Terren S. Peizer(3) | ||
10.3* | Employment Agreement of Richard A. Anderson(3) | ||
10.6* | Management and Support Services Agreement between Hythiam, Inc. and David E. Smith, M.D. Medical Group, Inc. (3) | ||
10.7* | Consulting Services Agreement between Hythiam, Inc. and David E. Smith & Associates(3) | ||
10.8* | First Amendment to Consulting Services Agreement between Hythiam, Inc. and David E. Smith, M.D. Medical Group, Inc. (4) | ||
10.9* | First Amendment to Management and Support Services Agreement Services Agreement between Hythiam, Inc. and David E. Smith, M.D. Medical Group, Inc. (4) | ||
10.10* | Second Amendment to Management and Support Services Agreement Services Agreement between Hythiam, Inc. and David E. Smith, M.D. Medical Group, Inc. (4) | ||
10.11* | Employment Agreement of Christopher Hassan(4) | ||
10.12* | 2007 Stock Incentive Plan(5) | ||
10.13 | Form of Standard Technology License and Administrative Services Agreement | ||
10.14* | Second Amendment to Consulting Services Agreement between Hythiam, Inc. and David E. Smith, M.D. Medical Group, Inc. | ||
10.15 | Redemption Agreement between Hythiam, Inc. and Highbridge International, LLC. | ||
14.1 | Code of Conduct and Ethics(2) | ||
14.2 | Code of Ethics for CEO and Senior Financial Officers(2) | ||
21.1 | Subsidiaries of the Company | ||
23.1 | Consent of Independent Registered Public Accounting Firm | ||
23.2 | Consent of Independent Valuation Specialist – Actuarial Risk Management | ||
31.1 | Certification by the Chief Executive Officer, pursuant to Rule | ||
31.2 | Certification by the Chief Financial Officer, pursuant to Rule | ||
32.1 | Certification by the Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
32.2 | Certification by the Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
(1) | Incorporated by reference to exhibit of the same number to the registrant’s Form 8-K filed September 30, 2003. | ||
(2) | Incorporated by reference to exhibit of the same number to the registrant’s annual report on Form 10-K for the year ended December 31, 2003. | ||
(3) | Incorporated by reference to exhibit of the same number to the |
(4) Incorporated by reference to exhibit of the same number to the registrant's annual report on Form 10-K for the year ended December 31, 2006. |
(5) Incorporated by reference to the registrant's Revised Definitive Proxy on Form DEFR14A filed May 11, 2007. |
43
HYTHIAM, INC. | ||||
Date: March | By: | /s/ TERREN S. PEIZER | ||
Terren S. Peizer | ||||
President and Chief Executive Officer |
44
Signature | Title(s) | Date | ||
/s/ TERREN S. PEIZER | Chairman of the Board of Directors and Chief | |||
Executive Officer (Principal Executive Officer) | March | |||
Terren S. Peizer | ||||
/s/ CHUCK TIMPE | Chief Financial Officer (Principal Financial Officer) | March | ||
Chuck Timpe | ||||
/s/ MAURICE HEBERT | Corporate Controller (Principal Accounting Officer) | March | ||
Maurice Hebert | ||||
/s/ RICHARD A. ANDERSON | Director and Senior Executive Vice President | March | ||
Richard A. Anderson | ||||
/s/ | Director and Senior Executive Vice President | March | ||
/s/ LESLIE F. BELL, ESQ. | Director | March | ||
Leslie F. Bell, Esq. | ||||
/s/ | Director | March | ||
/s/ IVAN M. LIEBERBURG, PH.D., M.D. | Director | March | ||
Ivan M. Lieberburg, Ph.D., M.D. | ||||
/s/ MARC G. CUMMINS | Director | March | ||
Marc G. Cummins | ||||
/s/ ANDREA GRUBB BARTHWELL, M.D. | Director | March | ||
Andrea Grubb Barthwell, M.D. |
45
F-2 | ||||
F-3 | ||||
2006 | F-4 | |||
2005 | F-5 | |||
2005 | F-6 | |||
2005 | F-7 | |||
F-8 |
F-1
F-2
F-3
December 31, | ||||||||
2006 | 2005 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 5,701 | $ | 3,417 | ||||
Marketable securities, at fair value | 37,746 | 43,583 | ||||||
Restricted cash | 82 | 44 | ||||||
Receivables, net | 637 | 249 | ||||||
Prepaids and other current assets | 383 | 427 | ||||||
Total current assets | 44,549 | 47,720 | ||||||
Long-term assets | ||||||||
Property and equipment, net | 3,711 | 3,498 | ||||||
Intellectual property, net | 3,397 | 2,733 | ||||||
Deposits and other assets | 548 | 511 | ||||||
Total Assets | $ | 52,205 | $ | 54,462 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 6,114 | $ | 2,652 | ||||
Accrued compensation and benefits | 2,786 | 1,285 | ||||||
Other accrued liabilities | 551 | 364 | ||||||
Total current liabilities | 9,451 | 4,301 | ||||||
Long-term liabilities | ||||||||
Deferred rent | 498 | 422 | ||||||
Capital lease obligations | 183 | — | ||||||
Other long-term liabilities | 44 | — | ||||||
Total Liabilities | 10,176 | 4,723 | ||||||
Commitments and contingencies (note 10) | ||||||||
Stockholders’ equity | ||||||||
Preferred stock, $.0001 par value; 50,000,000 shares authorized; no shares issued and outstanding | — | — | ||||||
Common stock, $.0001 par value; 200,000,000 shares authorized; 43,917,000 and 39,504,000 shares issued and 43,557,000 and 39,144,000 shares outstanding at December 31, 2006 and December 31, 2005, respectively | 4 | 4 | ||||||
Additional paid-in-capital | 119,764 | 89,176 | ||||||
Accumulated deficit | (77,739 | ) | (39,441 | ) | ||||
Total Stockholders’ Equity | 42,029 | 49,739 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 52,205 | $ | 54,462 | ||||
HYTHIAM, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands, except share data) | December 31, | |||||||
2007 | 2006 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 11,149 | $ | 5,701 | ||||
Marketable securities, at fair value | 35,840 | 37,746 | ||||||
Restricted cash | 39 | 82 | ||||||
Receivables, net | 1,787 | 637 | ||||||
Notes receivable | 133 | - | ||||||
Prepaids and other current assets | 1,394 | 383 | ||||||
Total current assets | 50,342 | 44,549 | ||||||
Long-term assets | ||||||||
Property and equipment, net of accumulated depreciation | ||||||||
of $5,630,000 and $2,224,000, respectively | 4,291 | 3,711 | ||||||
Goodwill | 10,557 | - | ||||||
Intangible assets, less accumulated amortization of | ||||||||
$1,609,000 and $591,000, respectively | 4,836 | 3,397 | ||||||
Deposits and other assets | 620 | 548 | ||||||
Total Assets | $ | 70,646 | $ | 52,205 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 4,038 | $ | 6,114 | ||||
Accrued compensation and benefits | 2,860 | 2,786 | ||||||
Accrued liabilities | 2,030 | 551 | ||||||
Accrued claims payable | 5,464 | - | ||||||
Short-term debt | 4,742 | - | ||||||
Income taxes payable | 94 | - | ||||||
Total current liabilities | 19,228 | 9,451 | ||||||
Long-term liabilities | ||||||||
Long-term debt | 2,057 | - | ||||||
Accrued reinsurance claims payable | 2,526 | - | ||||||
Warrant liability | 2,798 | - | ||||||
Capital lease obligations | 331 | 183 | ||||||
Deferred rent and other long-term liabilities | 442 | 542 | ||||||
Total Liabilities | 27,382 | 10,176 | ||||||
Commitments and contingencies (See Note 14) | ||||||||
Stockholders' equity | ||||||||
Preferred stock, $.0001 par value; 50,000,000 shares authorized; | ||||||||
no shares issued and outstanding | - | - | ||||||
Common stock, $.0001 par value; 200,000,000 shares authorized; | ||||||||
54,335,000 and 43,917,000 shares issued and 54,335,000 | ||||||||
and 43,557,000 shares outstanding at December 31, 2007 | ||||||||
and December 31, 2006, respectively | 5 | 4 | ||||||
Additional paid-in-capital | 166,460 | 119,764 | ||||||
Accumulated deficit | (123,201 | ) | (77,739 | ) | ||||
Total Stockholders' Equity | 43,264 | 42,029 | ||||||
Total Liabilities and Stockholders' Equity | $ | 70,646 | $ | 52,205 | ||||
See accompanying notes to financial statements. |
F-4
Year Ended December 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Revenues | $ | 3,906 | $ | 1,164 | $ | 192 | ||||||
Operating expenses | ||||||||||||
Cost of services | 818 | 134 | 17 | |||||||||
General and administrative expenses | ||||||||||||
Salaries and benefits | 16,212 | 9,204 | 5,117 | |||||||||
Other expenses | 22,468 | 13,173 | 6,156 | |||||||||
Research and development | 3,053 | 2,646 | 177 | |||||||||
Depreciation and amortization | 1,281 | 879 | 670 | |||||||||
Total operating expenses | 43,832 | 26,036 | 12,137 | |||||||||
Loss from operations | (39,926 | ) | (24,872 | ) | (11,945 | ) | ||||||
Interest income | 1,630 | 834 | 171 | |||||||||
Loss before provision for income taxes | (38,296 | ) | (24,038 | ) | (11,774 | ) | ||||||
Provision for income taxes | 2 | — | 1 | |||||||||
Net loss | $ | (38,298 | ) | $ | (24,038 | ) | $ | (11,775 | ) | |||
Net loss per share — basic and diluted | $ | (0.96 | ) | $ | (0.77 | ) | $ | (0.47 | ) | |||
Weighted average number of shares oustanding — basic and diluted | 39,715 | 31,173 | 24,877 | |||||||||
HYTHIAM, INC. AND SUBSIDIARIES | ||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
(In thousands, except per share amounts) | Year Ended December 31, | |||||||||||
2007 | 2006 | 2005 | ||||||||||
Revenues | ||||||||||||
Behavioral health managed care services | $ | 36,306 | $ | - | $ | - | ||||||
Healthcare services | 7,695 | 3,906 | 1,164 | |||||||||
Total revenues | 44,001 | 3,906 | 1,164 | |||||||||
Operating Expenses | ||||||||||||
Behavioral health managed care expenses | 35,679 | - | - | |||||||||
Cost of healthcare services | 2,052 | 818 | 134 | |||||||||
General and administrative expenses | 45,554 | 38,680 | 22,105 | |||||||||
Impairment loss | 2,387 | - | 272 | |||||||||
Research and development | 3,358 | 3,053 | 2,646 | |||||||||
Depreciation and amortization | 2,502 | 1,281 | 879 | |||||||||
Total operating expenses | 91,532 | 43,832 | 26,036 | |||||||||
Loss from operations | (47,531 | ) | (39,926 | ) | (24,872 | ) | ||||||
Interest income | 1,584 | 1,630 | 834 | |||||||||
Interest expense | (2,190 | ) | - | - | ||||||||
Loss on extinguishment of debt | (741 | ) | - | - | ||||||||
Change in fair value of warrant liability | 3,471 | - | - | |||||||||
Other non-operating income, net | 32 | - | - | |||||||||
Loss before provision for income taxes | (45,375 | ) | (38,296 | ) | (24,038 | ) | ||||||
Provision for income taxes | 87 | 2 | - | |||||||||
Net loss | $ | (45,462 | ) | $ | (38,298 | ) | $ | (24,038 | ) | |||
Net loss per share - basic and diluted | $ | (0.99 | ) | $ | (0.96 | ) | $ | (0.77 | ) | |||
Weighted average number of shares outstanding - basic and diluted | 45,695 | 39,715 | 31,173 | |||||||||
See accompanying notes to financial statements. |
F-5
Additional | ||||||||||||||||||||
(In thousands) | Common Stock | Paid-In | Accumulated | |||||||||||||||||
Shares | Amount | Capital | Deficit | Total | ||||||||||||||||
Balance at December 31, 2003 | 24,607 | $ | 3 | $ | 24,113 | $ | (3,628 | ) | $ | 20,488 | ||||||||||
Common stock, options and warrants issued for outside services | 17 | — | 1,351 | — | 1,351 | |||||||||||||||
Common stock issued in private placement offering, net of expenses | 5,017 | — | 21,349 | — | 21,349 | |||||||||||||||
Common stock issued for intellectual property acquired | 83 | — | 354 | — | 354 | |||||||||||||||
Exercise of warrants | 27 | — | 67 | — | 67 | |||||||||||||||
Net loss | — | — | — | (11,775 | ) | (11,775 | ) | |||||||||||||
Balance at December 31, 2004 | 29,751 | 3 | 47,234 | (15,403 | ) | 31,834 | ||||||||||||||
Common stock, options and warrants issued for outside services | 23 | — | 1,501 | — | 1,501 | |||||||||||||||
Exercise of options and warrants | 170 | — | 265 | — | 265 | |||||||||||||||
Common stock issued in public offering, net of expenses | 9,200 | 1 | 40,176 | — | 40,177 | |||||||||||||||
Net loss | — | — | — | (24,038 | ) | (24,038 | ) | |||||||||||||
Balance at December 31, 2005 | 39,144 | 4 | 89,176 | (39,441 | ) | 49,739 | ||||||||||||||
Common stock issued for intellectual property and outside services | 157 | — | 1,064 | — | 1,064 | |||||||||||||||
Options and warrants issued for employee and outside services | — | — | 3,462 | — | 3,462 | |||||||||||||||
Exercise of options and warrants | 683 | — | 1,690 | — | 1,690 | |||||||||||||||
Common stock issued in private placement offering, net of expenses | 3,573 | — | 24,372 | — | 24,372 | |||||||||||||||
Net loss | — | — | — | (38,298 | ) | (38,298 | ) | |||||||||||||
Balance at December 31, 2006 | 43,557 | $ | 4 | $ | 119,764 | $ | (77,739 | ) | $ | 42,029 | ||||||||||
F-6
HYTHIAM, INC. AND SUBSIDIARIES | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||||||||||||||||
Additional | ||||||||||||||||||||
(In thousands) | Common Stock | Paid-In | Accumulated | |||||||||||||||||
Shares | Amount | Capital | Deficit | Total | ||||||||||||||||
Balance at December 31, 2004 | 29,751 | $ | 3 | $ | 47,234 | $ | (15,403 | ) | $ | 31,834 | ||||||||||
Common stock, options and warrants | ||||||||||||||||||||
issued for outside services | 23 | - | 1,501 | - | 1,501 | |||||||||||||||
Exercise of options and warrants | 170 | - | 265 | - | 265 | |||||||||||||||
Common stock issued in public | ||||||||||||||||||||
offering, net of expenses | 9,200 | 1 | 40,176 | - | 40,177 | |||||||||||||||
Net loss | - | - | - | (24,038 | ) | (24,038 | ) | |||||||||||||
Balance at December 31, 2005 | 39,144 | 4 | 89,176 | (39,441 | ) | 49,739 | ||||||||||||||
Common stock issued for intellectual property | ||||||||||||||||||||
and outside services | 157 | - | 1,064 | - | 1,064 | |||||||||||||||
Options and warrants issued for | ||||||||||||||||||||
employee and outside services | - | - | 3,462 | - | 3,462 | |||||||||||||||
Exercise of options and warrants | 683 | - | 1,690 | - | 1,690 | |||||||||||||||
Common stock issued in private | ||||||||||||||||||||
placement offering, net of expenses | 3,573 | - | 24,372 | - | 24,372 | |||||||||||||||
Net loss | - | - | - | (38,298 | ) | (38,298 | ) | |||||||||||||
Balance at December 31, 2006 | 43,557 | 4 | 119,764 | (77,739 | ) | 42,029 | ||||||||||||||
Common stock issued for intellectual property | ||||||||||||||||||||
and outside services | 315 | - | 2,447 | - | 2,447 | |||||||||||||||
Options and warrants issued for | ||||||||||||||||||||
employee and outside services | - | - | 2,397 | - | 2,397 | |||||||||||||||
Exercise of options and warrants | 586 | - | 1,940 | - | 1,940 | |||||||||||||||
Common stock issued for employee stock | ||||||||||||||||||||
purchase plan | 27 | - | 124 | - | 124 | |||||||||||||||
Common stock issued for CompCare | ||||||||||||||||||||
acquisition | 215 | - | 2,084 | - | 2,084 | |||||||||||||||
Warrants issued with debt | - | - | 1,342 | - | 1,342 | |||||||||||||||
Common stock issued in registered | ||||||||||||||||||||
direct placement, net of expenses | 9,635 | 1 | 36,362 | - | 36,363 | |||||||||||||||
Net loss | - | - | - | (45,462 | ) | (45,462 | ) | |||||||||||||
Balance at December 31, 2007 | 54,335 | $ | 5 | $ | 166,460 | $ | (123,201 | ) | $ | 43,264 | ||||||||||
See accompanying notes to consolidated financial statements. |
Year ended December 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
(In thousands) | ||||||||||||
Operating activities | ||||||||||||
Net loss | $ | (38,298 | ) | $ | (24,038 | ) | $ | (11,775 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
Depreciation and amortization | 1,281 | 879 | 670 | |||||||||
Deferred rent | 134 | 124 | (17 | ) | ||||||||
Provision for doubtful accounts | 281 | 25 | 10 | |||||||||
Share-based compensation | 3,691 | 1,701 | 1,172 | |||||||||
Lease incentives granted | 68 | 30 | 301 | |||||||||
Asset impairment | — | 272 | — | |||||||||
Loss on disposition of fixed assets | — | 64 | — | |||||||||
Changes in current assets and liabilities: | ||||||||||||
Receivables | (737 | ) | (136 | ) | (24 | ) | ||||||
Prepaids and other current assets | 141 | (181 | ) | (20 | ) | |||||||
Accounts payable | 3,462 | 2,043 | (650 | ) | ||||||||
Accrued compensation and benefits | 1,501 | 459 | 508 | |||||||||
Other accrued liabilities | 45 | (31 | ) | (122 | ) | |||||||
Net cash used in operating activities | (28,431 | ) | (18,789 | ) | (9,947 | ) | ||||||
Investing activities | ||||||||||||
Purchase of marketable securities | (47,813 | ) | (80,704 | ) | (31,914 | ) | ||||||
Proceeds from sales and maturities of marketable securities | 53,650 | 60,600 | 21,631 | |||||||||
Restricted cash | (38 | ) | (44 | ) | — | |||||||
Purchases of property and equipment | (957 | ) | (1,803 | ) | (506 | ) | ||||||
Intellectual property costs | (143 | ) | (139 | ) | (126 | ) | ||||||
Deposits and other assets | (37 | ) | (146 | ) | 2 | |||||||
Net cash provided by (used in) investing activities | 4,662 | (22,236 | ) | (10,913 | ) | |||||||
Financing activities | ||||||||||||
Net proceeds from sale of common stock | 24,372 | 40,177 | 21,349 | |||||||||
Exercises of stock options and warrants | 1,690 | 265 | 67 | |||||||||
Capital lease obligations | (9 | ) | — | — | ||||||||
Net cash provided by financing activities | 26,053 | 40,442 | 21,416 | |||||||||
Net increase (decrease) in cash and cash equivalents | 2,284 | (583 | ) | 556 | ||||||||
Cash and cash equivalents at beginning of period | 3,417 | 4,000 | 3,444 | |||||||||
Cash and cash equivalents at end of period | $ | 5,701 | $ | 3,417 | $ | 4,000 | ||||||
Supplemental disclosure of cash paid | ||||||||||||
Income taxes | $ | 2 | $ | — | $ | 2 | ||||||
Supplemental disclosure of non-cash activity | ||||||||||||
Common stock issued for intellectual property | $ | 738 | $ | — | $ | 354 | ||||||
Common stock, options and warrants issued for outside services | 97 | — | 199 | |||||||||
Property and equipment aquired through capital leases and other financing | 320 | — | — |
F-7
HYTHIAM, INC. AND SUBSIDIARIES | ||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||
Year ended December 31, | ||||||||||||
(In thousands) | 2007 | 2006 | 2005 | |||||||||
Operating activities | ||||||||||||
Net loss | $ | (45,462 | ) | $ | (38,298 | ) | $ | (24,038 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
Depreciation and amortization | 2,500 | 1,281 | 879 | |||||||||
Amortization of debt discount, issuance cost included in interest expense | 1,026 | - | - | |||||||||
Provision for doubtful accounts | 528 | 281 | 25 | |||||||||
Deferred rent | (6 | ) | 134 | 124 | ||||||||
Share-based compensation expense | 2,605 | 3,691 | 1,701 | |||||||||
Impairment loss | 2,387 | - | 272 | |||||||||
Loss on extinguishment of debt | 741 | - | - | |||||||||
Fair value adjustment on warrant liability | (3,471 | ) | - | - | ||||||||
Loss on disposition of fixed assets | - | - | 64 | |||||||||
Changes in current assets and liabilities, net of business acquired: | ||||||||||||
Receivables | (810 | ) | (737 | ) | (136 | ) | ||||||
Prepaids and other current assets | (529 | ) | 141 | (181 | ) | |||||||
Accrued claims payable | 2,865 | - | - | |||||||||
Accounts payable | (1,594 | ) | 5,008 | 2,471 | ||||||||
Net cash used in operating activities | (39,220 | ) | (28,499 | ) | (18,819 | ) | ||||||
Investing activities | ||||||||||||
Purchases of marketable securities | (80,168 | ) | (47,813 | ) | (80,704 | ) | ||||||
Proceeds from sales and maturities of marketable securities | 82,104 | 53,650 | 60,600 | |||||||||
Cash paid related to acquisition of a business, net of cash acquired | (4,760 | ) | - | - | ||||||||
Restricted cash | 43 | (38 | ) | (44 | ) | |||||||
Purchases of property and equipment | (1,142 | ) | (889 | ) | (1,773 | ) | ||||||
Deposits and other assets | 152 | (37 | ) | (146 | ) | |||||||
Cost of intangibles | (320 | ) | (143 | ) | (139 | ) | ||||||
Net cash (used in) provided by investing activities | (4,091 | ) | 4,730 | (22,206 | ) | |||||||
Financing activities | ||||||||||||
Proceeds from sale of common stock and warrants | 37,512 | 24,372 | 40,177 | |||||||||
Cost related to issuance of common stock | (230 | ) | - | - | ||||||||
Cost related to issuance of debt and warrants | (303 | ) | - | - | ||||||||
Proceeds from issuance of debt and warrants | 10,000 | - | - | |||||||||
Capital lease obligations | (178 | ) | (9 | ) | - | |||||||
Exercises of stock options and warrants | 1,958 | 1,690 | 265 | |||||||||
Net cash provided by financing activities | 48,759 | 26,053 | 40,442 | |||||||||
Net increase in cash and cash equivalents | 5,448 | 2,284 | (583 | ) | ||||||||
Cash and cash equivalents at beginning of period | 5,701 | 3,417 | 4,000 | |||||||||
Cash and cash equivalents at end of period | $ | 11,149 | $ | 5,701 | $ | 3,417 | ||||||
Supplemental disclosure of cash paid | ||||||||||||
Interest | $ | 1,059 | $ | - | $ | - | ||||||
Income taxes | 36 | 2 | - | |||||||||
Supplemental disclosure of non-cash activity | ||||||||||||
Common stock, options and warrants issued for outside services | $ | 232 | $ | 97 | $ | - | ||||||
Common stock issued for intellectual property | - | 738 | - | |||||||||
Property and equipment acquired through capital leases and other financing | 284 | 320 | - | |||||||||
Common stock issued for acquisition of a business | 2,084 | - | - | |||||||||
Stock issued for redemption of debt | 5,350 | - | - |
F-8
F-9
2005 | 2004 | |||||||
Net loss as reported | $ | (24,038,000 | ) | $ | (11,775,000 | ) | ||
Add: Stock-based compensation expense | 20,000 | — | ||||||
Less: Stock-based expense determined under fair value based method | (901,000 | ) | (463,000 | ) | ||||
Pro forma net loss | $ | (24,919,000 | ) | $ | (12,238,000 | ) | ||
Net loss per share: | ||||||||
As reported — basic and diluted | $ | (0.77 | ) | $ | (0.47 | ) | ||
Pro forma — basic and diluted | $ | (0.80 | ) | $ | (0.49 | ) |
2005 | ||||
Net loss as reported | $ | (24,038,000 | ) | |
Add: Stock-based compensation expense | 20,000 | |||
Less: Stock-based expense determined under | ||||
fair value based method | (901,000 | ) | ||
Pro forma net loss | $ | (24,919,000 | ) | |
Net loss per share: | ||||
As reported – basic and diluted | $ | (0.77 | ) | |
Pro forma – basic and diluted | $ | (0.80 | ) |
2006 | 2005 | 2004 | ||||||||||
Expected volatility | 66 | % | 58 | % | 61 | % | ||||||
Risk-free interest rate | 4.72 | % | 4.18 | % | 4.24 | % | ||||||
Weighted average expected lives | 6.1 | years | 10 | years | 10 | years | ||||||
Expected dividend yield | 0 | % | 0 | % | 0 | % |
2007 | 2006 | 2005 | |||
Expected volatility | 64% | 66% | 58% | ||
Risk-free interest rate | 4.46% | 4.72% | 4.18% | ||
Weighted average expected lives in years | 6.5 | 6.1 | 10.0 | ||
Expected dividend yield | 0% | 0% | 0% |
F-10
For the period January 13 through December 31, 2007 | ||
Expected volatility | 110 | % |
Risk-free interest rate | 4.87 | % |
Weighted average expected lives in years | 3.3 | |
Expected dividend yield | 0 | % |
Fair Market | Less than | 5-10 | More than | |||||||||||||||||
Value | 1 Year | 1-5 Years | Years | 10 Years | ||||||||||||||||
December 31, 2006 | ||||||||||||||||||||
Variable auction rate taxable municipal securities | $ | 37,412,000 | $ | — | $ | — | $ | — | $ | 37,412,000 | ||||||||||
Certificates of deposits | 334,000 | 334,000 | ||||||||||||||||||
$ | 37,746,000 | $ | 334,000 | $ | — | $ | — | $ | 37,412,000 | |||||||||||
December 31, 2005 | ||||||||||||||||||||
Variable auction rate taxable municipal securities | $ | 43,241,000 | $ | — | $ | — | $ | — | $ | 43,241,000 | ||||||||||
Certificates of deposits | 342,000 | 342,000 | — | — | — | |||||||||||||||
$ | 43,583,000 | $ | 342,000 | $ | — | $ | — | $ | 43,241,000 | |||||||||||
Fair Market Value | Less than 1 Year | 1-5 Years | 5-10 Years | More than 10 Years | |||||||||||
December 31, 2007 | |||||||||||||||
Variable auction rate securities | $ | 19,000,000 | $ | - | $ | - | $ | - | $ | 19,000,000 | |||||
Commercial paper | 16,518,000 | - | - | - | 16,518,000 | ||||||||||
Certificates of deposits | 322,000 | 322,000 | - | - | - | ||||||||||
$ | 35,840,000 | $ | 322,000 | $ | - | $ | - | $ | 35,518,000 | ||||||
December 31, 2006 | |||||||||||||||
Variable auction rate securities | $ | 27,464,000 | $ | - | $ | - | $ | - | $ | 27,464,000 | |||||
Commercial paper | 9,948,000 | - | - | - | 9,948,000 | ||||||||||
Certificates of deposits | 334,000 | 334,000 | - | - | - | ||||||||||
$ | 37,746,000 | $ | 334,000 | $ | - | $ | - | $ | 37,412,000 | ||||||
F-11
Healthcare Services | Behavioral Health Managed Care | Total | ||||||||||
Balance as of January 1, 2007 | $ | - | $ | - | $ | - | ||||||
Goodwill - CompCare acquisition | 10,064,000 | 493,000 | 10,557,000 | |||||||||
Balance as of December 31, 2007 | $ | 10,064,000 | $ | 493,000 | $ | 10,557,000 | ||||||
F-12
F-13
F-14
2006 | 2005 | |||||||
License fees receivable | $ | 659,000 | $ | 168,000 | ||||
Patient fees receivable | 49,000 | — | ||||||
Tenant improvement allowance (1) | 224,000 | 68,000 | ||||||
Other receivables | 5,000 | 32,000 | ||||||
Total Receivables | 937,000 | 268,000 | ||||||
Less-allowance for doubtful accounts | (300,000 | ) | (19,000 | ) | ||||
Total Receivables, net | $ | 637,000 | $ | 249,000 | ||||
2007 | 2006 | |||||||
License fees receivable | $ | 2,100,000 | $ | 659,000 | ||||
Patient fees receivable | 282,000 | 49,000 | ||||||
Tenant improvement allowance (1) | - | 224,000 | ||||||
Managed care contracts | 35,000 | - | ||||||
Other | 21,000 | 5,000 | ||||||
Total Receivables | 2,438,000 | 937,000 | ||||||
Less-allowance for doubtful accounts | (651,000 | ) | (300,000 | ) | ||||
Total Receivables, net | $ | 1,787,000 | $ | 637,000 |
F-15
2006 | 2005 | |||||||
Furniture and equipment | $ | 2,968,000 | $ | 2,154,000 | ||||
Leasehold improvements | 2,967,000 | 2,516,000 | ||||||
Total Cost | 5,935,000 | 4,670,000 | ||||||
Less-accumulated depreciation | (2,224,000 | ) | (1,172,000 | ) | ||||
Property and Equipment, net | $ | 3,711,000 | $ | 3,498,000 | ||||
2007 | 2006 | |||||||
Furniture and equipment | $ | 6,363,000 | $ | 2,968,000 | ||||
Leasehold improvements | 3,558,000 | 2,967,000 | ||||||
Total Cost | 9,921,000 | 5,935,000 | ||||||
Less-accumulated depreciation | (5,630,000 | ) | (2,224,000 | ) | ||||
Property and Equipment, net | $ | 4,291,000 | $ | 3,711,000 |
At January 12, 2007 | |||
Cash and cash equivalents | $ | 4,304,000 | |
Other current assets | 1,840,000 | ||
Property and equipment | 389,000 | ||
Goodwill | 10,847,000 | ||
Intangible assets | 2,136,000 | ||
Other non-current assets | 237,000 | ||
Total assets | $ | 19,753,000 | |
Accounts payable and accrued liabilities | $ | (1,285,000 | |
Accrued claims payable | (2,599,000 | ||
Accrued reinsurance claims payable | (2,526,000 | ||
Long-term debt | (1,978,000 | ||
Other liabilities | (217,000 | ||
Total liabilities | $ | (8,605,000 | |
Total acquisition cost | $ | 11,148,000 | |
2007 | 2006 | Amortization Period (in years) | |||||||
Intellectual property (IP) | $ | 4,308,000 | $ | 3,988,000 | 12 to 20 | ||||
Managed care contracts (Note 5) | 832,000 | - | 3 to 7 | ||||||
Provider networks, NCQA (Note 5) | 1,305,000 | - | 2 to 3 | ||||||
Total Cost | 6,445,000 | 3,988,000 | |||||||
Less-Accumulated amort-IP | (832,000 | ) | (591,000 | ) | |||||
Less-Accumulated amort-Other | (777,000 | ) | - | ||||||
$ | 4,836,000 | $ | 3,397,000 |
F-16
2008 | $ | 974,000 | |
2009 | $ | 854,000 | |
2010 | $ | 263,000 | |
2011 | $ | 244,000 | |
2012 | $ | 244,000 |
Short-term Debt | ||||
Senior secured note due January, 2010, interest payable quarterly at prime plus 2.5%, net of $258,000 unamortized discount | $ | 4,742,000 | ||
Long-term Debt | ||||
7.5% Convertible subordinated debentures due April, 2010, interest payable semi-annually, net of $187,000 unamortized discount (1) | $ | 2,057,000 |
F-17
2006 | 2005 | |||||||
Deferred tax assets: | ||||||||
Federal, state & foreign net operating losses | $ | 25,454,000 | $ | 13,281,000 | ||||
Stock-based compensation | 2,810,000 | 1,283,000 | ||||||
Accrued liabilities | 481,000 | 425,000 | ||||||
Other temporary differences | 1,212,000 | 248,000 | ||||||
Valuation allowance | (29,957,000 | ) | (15,237,000 | ) | ||||
$ | — | $ | — | |||||
2006 | 2005 | 2004 | ||||||||||
Federal statutory rate | -34.0 | % | -34.0 | % | -34.0 | % | ||||||
State taxes | -4.9 | % | -5.3 | % | -6.0 | % | ||||||
Other | 0.5 | % | -1.5 | % | 0.0 | % | ||||||
Change in valuation allowance | 38.4 | % | 40.8 | % | 40.0 | % | ||||||
0.0 | % | 0.0 | % | 0.0 | % | |||||||
Amount | ||||
Year Ending December 31, | ||||
2007 | $ | 67 | ||
2008 | 68 | |||
2009 | 65 | |||
2010 | 50 | |||
2011 | 42 | |||
Total minimum lease payments | $ | 292 | ||
Less: Amount representing interest | (65 | ) | ||
Total capital lease obligations | 227 | |||
Less: Current maturities of capital lease obligations | (44 | ) | ||
Long-term capital lease obligations | $ | 183 | ||
F-18
Year Ending December 31, | Amount | |||
2008 | $ | 233 | ||
2009 | 187 | |||
2010 | 111 | |||
2011 | 76 | |||
2012 | - | |||
Total minimum lease payments | $ | 607 | ||
Less: Amount representing interest | (93 | ) | ||
Total capital lease obligations | 514 | |||
Less: Current maturities of capital lease obligations | (183 | ) | ||
Long-term capital lease obligations | $ | 331 |
2007 | 2006 | |||||||
Deferred tax assets: | ||||||||
Federal, state & foreign net operating losses | $ | 39,542,000 | $ | 25,454,000 | ||||
Stock-based compensation | 3,259,000 | 2,810,000 | ||||||
Accrued liabilities | 746,000 | 481,000 | ||||||
Other temporary differences | (666,000 | ) | 1,212,000 | |||||
Valuation allowance | (42,881,000 | ) | (29,957,000 | ) | ||||
$ | - | $ | - |
2007 | 2006 | ||
Federal statutory rate | -34.0% | -34.0% | |
State taxes | -4.4% | -4.9% | |
Other | 1.6% | 0.5% | |
Change in valuation allowance | 36.8% | 38.4% | |
0.0% | 0.0% |
F-19
Weighted Avg. | ||||||||
Shares | Exercise Price | |||||||
Balance, December 31, 2003 | 3,195,000 | $ | 2.58 | |||||
2004 | ||||||||
Granted | 1,404,000 | 4.24 | ||||||
Exercised | — | — | ||||||
Cancelled | (542,000 | ) | 3.69 | |||||
Balance, December 31, 2004 | 4,057,000 | $ | 3.01 | |||||
2005 | ||||||||
Granted | 1,317,000 | $ | 6.49 | |||||
Exercised | (54,000 | ) | 3.29 | |||||
Cancelled | (422,000 | ) | 4.88 | |||||
Balance, December 31, 2005 | 4,898,000 | $ | 3.78 | |||||
2006 | ||||||||
Granted | 1,657,000 | $ | 6.27 | |||||
Exercised | (80,000 | ) | 3.75 | |||||
Cancelled | (647,000 | ) | 5.34 | |||||
Balance, December 31, 2006 | 5,828,000 | $ | 4.32 | |||||
Weighted Avg. | ||||||||
Shares | Exercise Price | |||||||
Balance, December 31, 2004 | 4,057,000 | $ | 3.01 | |||||
2005 | ||||||||
Granted | 1,317,000 | 6.49 | ||||||
Exercised | (54,000 | ) | 3.29 | |||||
Cancelled | (422,000 | ) | 4.88 | |||||
Balance, December 31, 2005 | 4,898,000 | $ | 3.78 | |||||
2006 | ||||||||
Granted | 1,657,000 | $ | 6.27 | |||||
Exercised | (80,000 | ) | 3.75 | |||||
Cancelled | (647,000 | ) | 5.34 | |||||
Balance, December 31, 2006 | 5,828,000 | $ | 4.32 | |||||
2007 | ||||||||
Granted | 732,000 | $ | 7.08 | |||||
Transfer * | (695,000 | ) | 5.10 | |||||
Exercised | (483,000 | ) | 3.14 | |||||
Cancelled | (230,000 | ) | 6.47 | |||||
Balance, December 31, 2007 | 5,152,000 | $ | 4.61 | |||||
* Option transfer due to status change from employee to non-employee. |
Options Outstanding | Options Exercisable | |||||||||||||||||||
Weighted | ||||||||||||||||||||
Average | Weighted | Weighted | ||||||||||||||||||
Remaining | Average | Average | ||||||||||||||||||
Range of Exercise Prices | Shares | Life (yrs) | Price | Shares | Price | |||||||||||||||
$2.50 to $3.50 | 3,098,000 | 6.8 | $ | 2.61 | 1,917,000 | $ | 2.61 | |||||||||||||
$3.51 to $4.50 | 144,000 | 7.8 | 4.25 | 70,000 | 4.25 | |||||||||||||||
$4.51 to $5.50 | 571,000 | 9.6 | 4.77 | — | — | |||||||||||||||
$5.51 to $6.50 | 1,017,000 | 7.9 | 5.90 | 187,000 | 5.72 | |||||||||||||||
$6.51 to $7.50 | 540,000 | 7.9 | 7.32 | 129,000 | 7.39 | |||||||||||||||
$7.51 to $8.50 | 434,000 | 9.9 | 7.89 | 116,000 | 7.89 | |||||||||||||||
$8.51 to $9.50 | 24,000 | 9.3 | 8.56 | — | — | |||||||||||||||
5,828,000 | 2,419,000 | |||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||
Range of Exercise Prices | Shares | Weighted Average Remaining Life (yrs) | Weighted Average Price | Shares | Weighted Average Price | ||||||
$2.50 to $3.50 | 2,435,000 | 5.8 | $ 2.62 | 1,954,000 | $ 2.61 | ||||||
$3.51 to $4.50 | 189,000 | 8.7 | 4.13 | 44,000 | 4.25 | ||||||
$4.51 to $5.50 | 565,000 | 8.6 | 4.77 | 113,000 | 4.77 | ||||||
$5.51 to $6.50 | 717,000 | 7.5 | 6.08 | 285,000 | 5.92 | ||||||
$6.51 to $7.50 | 583,000 | 8.3 | 7.24 | 133,000 | 7.30 | ||||||
$7.51 to $8.50 | 582,000 | 9.0 | 7.92 | 172,000 | 7.89 | ||||||
$8.51 to $9.50 | 81,000 | 9.2 | 9.00 | - | - | ||||||
5,152,000 | 7.1 | 4.61 | 2,701,000 | 3.64 |
F-20
Weighted Avg. | ||||||||
Shares | Exercise Price | |||||||
Balance, December 31, 2003 | 1,979,000 | $ | 2.52 | |||||
2004 | ||||||||
Granted | 370,000 | 5.05 | ||||||
Exercised | (27,000 | ) | 2.50 | |||||
Cancelled | — | — | ||||||
Balance, December 31, 2004 | 2,322,000 | $ | 2.92 | |||||
2005 | ||||||||
Granted | 110,000 | $ | 5.32 | |||||
Exercised | (116,000 | ) | 2.50 | |||||
Cancelled | (314,000 | ) | 2.50 | |||||
Balance, December 31, 2005 | 2,002,000 | $ | 3.15 | |||||
2006 | ||||||||
Granted | 368,000 | $ | 4.96 | |||||
Exercised | (603,000 | ) | 2.53 | |||||
Cancelled | (372,000 | ) | 3.78 | |||||
Balance, December 31, 2006 | 1,395,000 | $ | 3.72 | |||||
Weighted Avg. | ||||||||
Shares | Exercise Price | |||||||
Balance, December 31, 2004 | 2,322,000 | $ | 2.92 | |||||
2005 | ||||||||
Granted | 110,000 | 5.32 | ||||||
Exercised | (116,000 | ) | 2.50 | |||||
Cancelled | (314,000 | ) | 2.50 | |||||
Balance, December 31, 2005 | 2,002,000 | $ | 3.14 | |||||
2006 | ||||||||
Granted | 368,000 | $ | 4.96 | |||||
Exercised | (603,000 | ) | 2.53 | |||||
Cancelled | (372,000 | ) | 3.78 | |||||
Balance, December 31, 2006 | 1,395,000 | $ | 3.72 | |||||
2007 | ||||||||
Granted | 65,000 | $ | 7.47 | |||||
Transfer * | 695,000 | 5.10 | ||||||
Exercised | (104,000 | ) | 4.57 | |||||
Cancelled | (42,000 | ) | 6.24 | |||||
Balance, December 31, 2007 | 2,009,000 | $ | 4.22 | |||||
* Option transfer due to status change from employee to non-employee. |
Weighted | ||||||||||||
Average | Weighted | |||||||||||
Remaining | Average | |||||||||||
Contractual | Exercise | |||||||||||
Description | Shares | Life (yrs) | Price | |||||||||
Warrants issued for intellectual property | 532,000 | 5.2 | $ | 2.50 | ||||||||
Warrants issued in connection with equity offering | 111,000 | 2.7 | 2.89 | |||||||||
Options and warrants issued to consultants | 752,000 | 2.7 | 4.71 | |||||||||
1,395,000 | 3.7 | $ | 3.72 | |||||||||
Description | Shares | Weighted Average Remaining Contractual Life (yrs) | Weighted Average Exercise Price | |||||||
Warrants issued for intellectual property | 532,000 | 4.2 | $ | 2.50 | ||||||
Warrants issued in connection with equity offering | 2,515,000 | 4.7 | 5.64 | |||||||
Warrants issued in connection with debt agreement | 285,000 | 4.1 | 10.52 | |||||||
Options and warrants issued to consultants | 1,362,000 | 4.5 | 5.02 | |||||||
4,694,000 | 4.5 | $ | 5.40 | |||||||
F-21
Shares | Weighted Avg. Exercise Price | ||||||
Balance, January 13, 2007 | 1,166,000 | $ | 1.32 | ||||
Granted | 145,000 | 1.05 | |||||
Exercised | (37,000 | ) | 0.51 | ||||
Cancelled | (204,000 | ) | 1.77 | ||||
Balance, December 31, 2007 | 1,070,000 | $ | 1.23 |
For the period January 13 through December 31, 2007 | |||
Options granted | 145,000 | ||
Weighted-average grant-date fair value | $ | 0.76 | |
Options exercised | 37,000 | ||
Total intrinsic value of exercised options | $ | 13,000 | |
Fair value of vested options | $ | 11,000 |
Options Outstanding | Options Exercisable | ||||||||||
Range of Exercise Prices | Shares | Weighted Average Remaining Life (yrs) | Weighted Average Price | Shares | Weighted Average Price | ||||||
$0.25 to $0.27 | 182,000 | 2.59 | $ 0.26 | 182,000 | $ 0.26 | ||||||
$0.39 to $0.56 | 261,000 | 2.47 | 0.54 | 261,000 | 0.54 | ||||||
$0.78 to $1.12 | 189,000 | 8.90 | 1.07 | 44,000 | 1.10 | ||||||
$1.40 to $1.78 | 247,000 | 6.76 | 1.62 | 247,000 | 1.62 | ||||||
$1.80 to $2.16 | 94,000 | 7.40 | 1.95 | 94,000 | 1.95 | ||||||
$3.56 to $4.00 | 97,000 | 0.95 | 3.95 | 97,000 | 3.95 | ||||||
1,070,000 | 4.91 | $ 1.27 | 925,000 | $ 1.30 |
Number of warrants | 306,000 | |||
Exercise price | $ | 1.25 | ||
Volatility factor of CompCare's common stock | 95 | % | ||
Expected life of the warrants | 3 years | |||
Risk-free interest rate | 3.9 | % | ||
Dividend yield | 0.0 | % | ||
Warrant valuation (in thousands) | $ | 234 |
Year Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Behavioral health managed care services (1) | ||||||||||||
Revenues | $ | 36,306,000 | $ | - | $ | - | ||||||
Loss before provision for income taxes | (4,105,000 | ) | - | - | ||||||||
Assets * | 8,896,000 | - | - | |||||||||
Healthcare services | ||||||||||||
Revenues | $ | 7,695,000 | $ | 3,906,000 | $ | 1,164,000 | ||||||
Loss before provision for income taxes | (41,270,000 | ) | (38,296,000 | ) | (24,038,000 | ) | ||||||
Assets * | 61,750,000 | 52,205,000 | 54,462,000 | |||||||||
Consolidated operations | ||||||||||||
Revenues | $ | 44,001,000 | $ | 3,906,000 | $ | 1,164,000 | ||||||
Loss before provision for income taxes | (45,375,000 | ) | (38,296,000 | ) | (24,038,000 | ) | ||||||
Total Assets * | 70,646,000 | 52,205,000 | 54,462,000 | |||||||||
* Assets are reported as of December 31. | ||||||||||||
(1) Results for the year in this segment represent the period January 13 through December 31, 2007. |
Operating | ||||
Leases | ||||
Year Ending December 31, | (000's) | |||
2008 | $ | 1,624 | ||
2009 | 1,364 | |||
2010 | 1,246 | |||
2011 | 250 | |||
2012 | 158 | |||
Total minimum lease payments | $ | 4,642 |
F-22
F-23
Quarter Ended | Total | |||||||||||||||||||
March | June | September | December | Year | ||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||
Year Ended December, 31, 2006 | ||||||||||||||||||||
Revenues | $ | 653 | $ | 1,172 | $ | 1,071 | $ | 1,010 | $ | 3,906 | ||||||||||
Loss from operations | (9,204 | ) | (9,394 | ) | (10,212 | ) | (11,116 | ) | (39,926 | ) | ||||||||||
Net loss | (8,728 | ) | (8,962 | ) | (9,829 | ) | (10,779 | ) | (38,298 | ) | ||||||||||
Basic and diluted loss per share | (0.22 | ) | (0.23 | ) | (0.25 | ) | (0.27 | ) | (0.96 | ) | ||||||||||
Year Ended December, 31, 2005 | ||||||||||||||||||||
Revenues | $ | 203 | $ | 230 | $ | 361 | $ | 370 | $ | 1,164 | ||||||||||
Loss from operations | (4,480 | ) | (4,866 | ) | (6,756 | ) | (8,770 | ) | (24,872 | ) | ||||||||||
Net loss | (4,319 | ) | (4,692 | ) | (6,604 | ) | (8,423 | ) | (24,038 | ) | ||||||||||
Basic and diluted loss per share | (0.15 | ) | (0.16 | ) | (0.22 | ) | (0.24 | ) | (0.77 | ) |
F-24
Quarter Ended | Total | ||||||||||||||||||||||
March | June | September | December | Year | |||||||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||||||||||
Year Ended December, 31, 2007 | |||||||||||||||||||||||
Revenues | $ | 8,857 | $ | 11,340 | $ | 12,020 | $ | 11,784 | $ | 44,001 | |||||||||||||
Loss from operations | (10,772 | ) | (12,020 | ) | (13,473 | ) | (a) | (11,266 | ) | (47,531 | ) | ||||||||||||
Net loss | (10,743 | ) | (12,252 | ) | (13,843 | ) | (a) | (8,624 | ) | (b) | (c) | (45,462 | ) | ||||||||||
Basic and diluted loss per share | (0.25 | ) | (0.28 | ) | (0.31 | ) | (a) | (0.17 | ) | (b) | (c) | (0.99 | ) | ||||||||||
Year Ended December, 31, 2006 | |||||||||||||||||||||||
Revenues | $ | 653 | $ | 1,172 | $ | 1,071 | $ | 1,010 | $ | 3,906 | |||||||||||||
Loss from operations | (9,204 | ) | (9,394 | ) | (10,212 | ) | (10,486 | ) | (39,296 | ) | |||||||||||||
Net loss | (8,728 | ) | (8,962 | ) | (9,829 | ) | (10,779 | ) | (38,298 | ) | |||||||||||||
Basic and diluted loss per share | (0.22 | ) | (0.23 | ) | (0.25 | ) | (0.27 | ) | (0.96 | ) |
(a) | Includes a $2.4 million impairment loss related to the non-cash stock settlement reached with XINO Corporation in August 2007. See further discussion in Note 6 – Intangible Assets. |
(b) | The fair value of warrants issued in conjunction with the registered direct placement in November 2007 was accounted for as a liability and was revalued at $2.8 million at December 31, 2007, resulting in $3.5 million non-operating gain. |
(c) | Includes a loss of $741,000 on extinguishment of debt resulting from the redemption of $5 million in Highbridge senior secured notes in November 2007. See further discussion in Note 7 – Debt Outstanding. |