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Delaware (State or other jurisdiction of incorporation or organization) | 8071 (Primary Standard Industrial Classification Code Number) | 33-0702770 (I.R.S. Employer Identification No.) |
Proposed Maximum | ||||||||
Title of Each Class of | Amount to | Offering Price | Proposed Maximum | Amount of | ||||
Securities to be Registered | be Registered | Per Unit | Aggregate Offering Price | Registration Fee(2) | ||||
Senior Secured Floating Rate Notes due 2011 | $300,000,000 | 100% | $300,000,000(1) | $35,310 | ||||
Guarantees of Senior Secured Floating Rate Notes due 2011 | — | — | — | (3) | ||||
(1) | Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 under the Securities Act of 1933, as amended. |
(2) | Pursuant to Rule 457(p), the total dollar amount of the fee set forth below is offset against a fee previously paid to the Securities and Exchange Commission by InSight Health Services Holdings Corp. (“InSight Holdings”). InSight Holdings is the parent corporation of the registrant and owns 100% of the registrant’s outstanding voting securities. InSight Holdings previously paid $85,522.50 in connection with a registration statement on Form S-1 (Registration Number 333-116751), which was filed on June 23, 2004 and withdrawn on August 16, 2004. On November 3, 2004, the registrant filed a Form S-4 registration statement, which later became effective, and offset $3,167.50 of InSight Holdings’ balance. As a result of this filing, InSight Holdings will have a balance of $47,045 to offset against future filings. |
(3) | Pursuant to Rule 457(n), no separate fee is payable with respect to the guarantees. |
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I.R.S. Employer | ||||||||
Exact Name of Registrant Guarantor | State or Other Jurisdiction of | Identification | ||||||
as Specified in its Charter | Incorporation or Organization | Number | ||||||
InSight Health Services Holdings Corp. | Delaware | 04-3570028 | ||||||
InSight Health Corp. | Delaware | 52-1278857 | ||||||
Signal Medical Services, Inc. | Delaware | 33-0802413 | ||||||
Open MRI, Inc. | Delaware | 94-3251529 | ||||||
Maxum Health Corp. | Delaware | 75-2287276 | ||||||
Radiosurgery Centers, Inc. | Delaware | 33-0522445 | ||||||
Maxum Health Services Corp. | Delaware | 75-2135957 | ||||||
MRI Associates, L.P. | Indiana | 35-1881106 | ||||||
Maxum Health Services of North Texas, Inc. | Texas | 75-2435797 | ||||||
Maxum Health Services of Dallas, Inc. | Texas | 75-2615132 | ||||||
NDDC, Inc. | Texas | 75-2407830 | ||||||
Diagnostic Solutions Corp. | Delaware | 75-2565249 | ||||||
Wilkes-Barre Imaging, L.L.C | Pennsylvania | 52-2238781 | ||||||
Orange County Regional PET Center — Irvine, LLC | California | 91-2070190 | ||||||
San Fernando Valley Regional PET Center, LLC | California | 91-2070191 | ||||||
Valencia MRI, LLC | California | 91-2070193 | ||||||
Parkway Imaging Center, LLC | Nevada | 33-0872858 | ||||||
InSight Imaging Services Corp. | Delaware | 81-0648120 | ||||||
Comprehensive Medical Imaging, Inc. | Delaware | 95-4662473 | ||||||
Comprehensive Medical Imaging Centers, Inc. | Delaware | 95-4666946 | ||||||
Comprehensive Medical Imaging — Biltmore, Inc. | Delaware | 95-4800644 | ||||||
Comprehensive OPEN MRI — East Mesa, Inc. | Delaware | 95-4803601 | ||||||
TME Arizona, Inc. | Texas | 76-0539851 | ||||||
Comprehensive Medical Imaging — Fremont, Inc. | Delaware | 95-4808736 | ||||||
Comprehensive Medical Imaging — San Francisco, Inc. | Delaware | 95-4808722 | ||||||
Comprehensive OPEN MRI — Garland, Inc. | Delaware | 77-0547383 | ||||||
IMI of Arlington, Inc. | Delaware | 52-2081524 | ||||||
Comprehensive Medical Imaging — Fairfax, Inc. | Delaware | 95-4666947 | ||||||
IMI of Kansas City, Inc. | Delaware | 77-0477240 | ||||||
Comprehensive Medical Imaging — Bakersfield, Inc. | Delaware | 77-0512185 | ||||||
Comprehensive OPEN MRI — Carmichael/ Folsom, LLC | California | 77-0505765 | ||||||
Syncor Diagnostics Sacramento, LLC | California | 91-1838444 | ||||||
Syncor Diagnostics Bakersfield, LLC | California | 77-0469131 | ||||||
Phoenix Regional PET Center — Thunderbird, LLC | Arizona | 77-0578521 | ||||||
Mesa MRI | Texas | 76-0316425 | ||||||
Mountain View MRI | Texas | 86-0651713 | ||||||
Los Gatos Imaging Center | Texas | 94-3040209 | ||||||
Woodbridge MRI | Texas | 54-1623177 | ||||||
Jefferson MRI — Bala | Texas | 76-0300719 | ||||||
Jefferson MRI | Texas | 23-2579343 |
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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor is it seeking an offer to buy these securities in any state where the offer or sale is not permitted. |
• | Our offer to exchange initial notes for exchange notes expires at 5:00 p.m., New York City time, on January , 2006, unless we extend the offer. | |
• | If you fail to tender your initial notes, you will continue to hold unregistered securities and your ability to transfer them could be adversely affected. | |
• | You may withdraw your tender of initial notes at any time prior to the expiration of the exchange offer. | |
• | No public market currently exists for the exchange notes. We do not intend to apply for listing of the exchange notes on any securities exchange or for inclusion of the exchange notes in any automated quotation system. | |
• | The exchange offer is subject to customary conditions, including that it does not violate applicable law or any applicable interpretation of the staff of the Securities and Exchange Commission, or SEC. | |
• | We will not receive any proceeds from the exchange offer. | |
• | If the holder of the notes is a broker-dealer that will receive exchange notes for its own account in exchange for initial notes that were acquired as a result of market-making activities or other trading activities, it will be required to acknowledge that it will deliver this prospectus, as it may be amended or supplemented, in connection with any resale of such exchange notes. |
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EX-12.1: RATIO OF EARNINGS TO FIXED CHARGES | ||||||||
EX-23.1: CONSENT OF PRICEWATERHOUSECOOPERS, LLP |
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• | limitations and delays in reimbursement by third-party payors; | |
• | contract renewals and financial stability of customers; | |
• | conditions within the healthcare environment; | |
• | adverse utilization trends for certain diagnostic imaging procedures; | |
• | our ability to successfully integrate acquisitions; | |
• | competition in our markets; | |
• | the potential for rapid and significant changes in technology and their effect on our operations; | |
• | operating, legal, governmental and regulatory risks; and | |
• | economic, political and competitive forces affecting our business. |
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This summary highlights information contained elsewhere in this prospectus. Because this is only a summary, it does not contain all of the information that may be important to you. For a more complete understanding of this offering, we encourage you to read this entire prospectus, including the section entitled “Risk Factors,” and the documents referred to under the heading “Where You Can Find More Information” prior to deciding whether to participate in the exchange offer. The section of this prospectus entitled “Description of Notes” contains more detailed information regarding the terms of the exchange notes. | |
In this prospectus, the term “Holdings” refers to InSight Health Services Holdings Corp., a Delaware corporation, the term “InSight” refers to InSight Health Services Corp., a Delaware corporation and wholly-owned subsidiary of Holdings, and the terms “the Company,” “our company,” “we,” “us” and “our” refer to Holdings and its consolidated subsidiaries, including InSight, unless stated or the context otherwise requires. |
On September 22, 2005, we issued, through InSight, an aggregate principal amount of $300 million of senior secured floating rate notes due 2011 in an offering exempt from registration under the Securities Act. We refer to the notes issued in September 2005 as the “initial notes.” The term “exchange notes” refers to the senior secured floating notes due 2011 newly offered under this prospectus. The term “notes” refers to both the initial notes and exchange notes. | |
In connection with the private offering of the initial notes, we entered into a registration rights agreement. Under the registration rights agreement, we are obligated, among other things, to deliver to you this prospectus and complete the exchange offer. This exchange offer allows you to exchange your initial notes for newly registered exchange notes with substantially similar terms. If the exchange offer is not completed as contemplated in the registration rights agreement, we will be required to pay liquidated damages to holders of the initial notes, and to holders of the exchange notes under limited circumstances. You should read the registration rights agreement in its entirety for more information. You should refer to the section in this prospectus entitled “Where You Can Find More Information” for information on how to obtain a copy of the registration rights agreement. |
We are a nationwide provider of diagnostic imaging services through our integrated network of fixed-site centers and mobile facilities which are focused in targeted regions throughout the United States. Our services include magnetic resonance imaging, or MRI, positron emission tomography, or PET, computed tomography, or CT, and other technologies. These services are non-invasive techniques that generate representations of internal anatomy on film or digital media which are used by physicians for the diagnosis and assessment of diseases and disorders. Our historical revenues and Adjusted EBITDA for fiscal 2005 were approximately $316.9 million and approximately $98.3 million, respectively. | |
Our large integrated network of fixed-site centers and mobile facilities allows us to provide a full continuum of imaging services to better meet the needs of our customers, including healthcare providers, such as hospitals and physicians, and payors, such as managed care organizations, Medicare, Medicaid and insurance companies. Our fixed-site centers include freestanding centers and joint ventures with hospitals and radiology groups. Physicians refer patients to our fixed-site centers based on our service reputation, advanced equipment, breadth of managed care contracts and convenient locations. Our mobile facilities provide hospitals and physician groups access to imaging technologies when they lack either the resources or patient volume to provide their own full-time imaging services or require incremental capacity. We enter into agreements with radiologists to provide professional services, which include supervision and |
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interpretation of radiological procedures and quality assurance. We do not engage in the practice of medicine. |
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||||||||||
Pro forma | ||||||||||||||||||||||||||||||||||||||||
Pro forma | Three Months | for the | ||||||||||||||||||||||||||||||||||||||
Period from | for the Year | Ended | Three Months | |||||||||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | Ended | September 30, | Ended | |||||||||||||||||||||||||||||||||||
June 30, | October 17, | June 30, | September 30, | |||||||||||||||||||||||||||||||||||||
2001 | 2001 | 2002 | 2003 | 2004 | 2005 | 2005 | 2004 | 2005 | 2005 | |||||||||||||||||||||||||||||||
Ratio of earnings to fixed charges | 1.6 | x | — | 1.0 | x | 1.2 | x | 1.1 | x | — | — | — | — | — |
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The Initial Offering of Initial Notes | We issued the initial notes on September 22, 2005 to Banc of America Securities LLC and CIBC World Markets Corp., which are referred to in this prospectus as the “initial purchasers.” The initial purchasers subsequently resold the initial notes to qualified institutional buyers pursuant to Rule 144A under the Securities Act or pursuant to offers and sales to non-U.S. persons that occurred outside the United States within the meaning of Regulation S under the Securities Act. | |
The Exchange Offer | We are offering to exchange your initial notes for exchange notes, which have been registered under the Securities Act. In order to be exchanged, an outstanding note must be properly tendered and accepted. You may tender outstanding notes only in denominations of $1,000 and multiples of $1,000. As of the date of this prospectus, $300.0 million in aggregate principal amount of initial notes is outstanding. All initial notes that are validly tendered and not validly withdrawn will be exchanged. We will issue exchange notes promptly after the expiration of the exchange offer. | |
Resales | We believe that the exchange notes issued in the exchange offer may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery provisions of the Securities Act provided that: | |
• the exchange notes are being acquired in the ordinary course of your business; | ||
• you are not participating, do not intend to participate, and have no arrangement or understanding with any person to participate, in the distribution of the exchange notes issued to you in the exchange offer; and | ||
• you are not an affiliate of ours. | ||
If any of these conditions is not satisfied and you transfer any exchange notes issued to you in the exchange offer without delivering a prospectus meeting the requirements of the Securities Act or without an exemption from registration of your exchange notes from these requirements, you may incur liability under the Securities Act. We will not assume, nor will we indemnify you against, any such liability. | ||
Each broker-dealer that is issued exchange notes in the exchange offer for its own account in exchange for initial notes that were acquired by that broker-dealer as a result of market-making or other trading activities, must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of the exchange notes. A broker-dealer may use this prospectus for an offer to resell, resale or other transfer of the exchange notes issued to it in the exchange offer. |
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Expiration Date | The exchange offer will expire at 5:00 p.m., New York City time, January , 2006, unless we decide to extend the expiration date. | |
Conditions to the Exchange Offer | The exchange offer is subject to customary conditions, including that it does not violate applicable law or any applicable interpretation of the staff of the SEC. The exchange offer is not conditioned upon any minimum principal amount of initial notes being tendered for exchange. For additional information, see the section of this prospectus entitled “The Exchange Offer — Conditions.” | |
Procedures for Tendering Initial Notes | If you wish to tender your initial notes for exchange in this exchange offer, you must transmit to the exchange agent on or before the expiration date either: | |
• an original or a facsimile of a properly completed and duly executed letter of transmittal, which accompanies this prospectus, together with your initial notes and any other documentation required by the letter of transmittal, at the address provided on the cover page of the letter of transmittal; or | ||
• if the initial notes you own (i) are held of record by The Depositary Trust Company, or DTC, (ii) are in book-entry form and (iii) you are making delivery by book-entry transfer, a computer-generated message transmitted by means of the Automated Tender Offer Program System of DTC, or ATOP, in which you acknowledge and agree to be bound by the terms of the letter of transmittal and which, when received by the exchange agent, forms a part of a confirmation of book-entry transfer. As part of the book-entry transfer, DTC will facilitate the exchange of your initial notes and update your account to reflect the issuance of the exchange notes to you. ATOP allows you to electronically transmit your acceptance of the exchange offer to DTC instead of physically completing and delivering a letter of transmittal to the exchange agent. In addition, you must deliver to the exchange agent on or before the expiration date a timely confirmation of book-entry transfer of your initial notes into the account of the notes exchange agent at DTC. If you cannot satisfy either of these procedures on a timely basis, then you should comply with the guaranteed delivery procedures described below. | ||
Guaranteed Delivery Procedures | If you wish to tender your initial notes and time will not permit the documents required by the letter of transmittal to reach the exchange agent before the expiration date, or the procedure for book-entry transfer cannot be completed on a timely basis, you must tender your initial notes according to the guaranteed delivery procedures described in the section of this prospectus entitled “The Exchange Offer — Guaranteed Delivery Procedures.” | |
Special Procedures for Beneficial Owners | If you are the beneficial owner of book-entry interests and your name does not appear on a security position listing of DTC as |
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the holder of the book-entry interests or if you are a beneficial owner of initial notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender the book-entry interest or initial notes in the exchange offer, you should contact the person in whose name your book-entry interests or initial notes are registered promptly and instruct that person to tender on your behalf. | ||
Acceptance of Initial Notes | Subject to the satisfaction or waiver of the conditions to the exchange offer, we will accept for exchange any and all initial notes which are validly tendered in the exchange offer and not withdrawn before 5:00 p.m., New York City time, on January , 2006. | |
Withdrawal Rights | You may withdraw the tender of your initial notes at any time prior to 5:00 p.m., New York City time on January , 2006. | |
Consequences of Failure to Exchange Initial Notes | If you do not exchange your initial notes for exchange notes, your initial notes will continue to be subject to restrictions on transfer. In general, the initial notes may not be offered or sold, unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. | |
Federal Income Tax Considerations | Based on the advice of counsel, the exchange of initial notes will not be a taxable event for U.S. federal income tax purposes. | |
Use of Proceeds | We will not receive any proceeds from the issuance of exchange notes. We will pay all of our expenses incident to the exchange offer. | |
Registration Rights Agreement | Simultaneously with the issuance of the initial notes, we entered into a registration rights agreement with the initial purchasers. The exchange offer is intended to satisfy our obligations under the registration rights agreement. | |
Exchange Agent | U.S. Bank National Association, the trustee under the indenture, is serving as the exchange agent in connection with the exchange offer. |
Issuer | InSight Health Services Corp., a Delaware corporation. | |
Securities | $300.0 million aggregate principal amount of senior secured floating rate notes due 2011. |
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Maturity | November 1, 2011. | |
Interest | Interest on the notes will accrue at the rate per annum, reset quarterly, equal to LIBOR plus 5.25%. | |
Interest Payment Dates | Each February 1, May 1, August 1 and November 1, commencing on February 1, 2006. | |
Guarantees | The notes will be unconditionally guaranteed on a senior secured basis by Holdings and each of InSight’s existing and future domestic wholly owned subsidiaries, which are collectively referred to in this prospectus as the guarantors. | |
Ranking | The notes and the related guarantees are general senior secured obligations. Accordingly, they will rank: | |
• equally in right of payment with all existing and any future senior indebtedness that we and the guarantors may incur; | ||
• effectively senior to our and the guarantors’ obligations under our amended revolving credit facility (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity”) and unsecured obligations to the extent of the value of the collateral securing the notes and the guarantees; | ||
• effectively subordinated to our obligations under our amended revolving credit facility, other indebtedness and guarantees of those obligations by the guarantors to the extent of the value of the collateral in which the holders of those obligations have a lien; | ||
• senior to our existing 97/8% unsecured senior subordinated notes due 2011 and any future subordinated indebtedness that we and the guarantors may incur; and | ||
• effectively subordinated to any obligations, including trade payables, of any of our subsidiaries that do not guarantee the notes. | ||
Collateral | The notes and the guarantees will be secured by a first priority lien on substantially all of our and the guarantors’ existing and future tangible and intangible personal property including, without limitation, equipment, certain contracts and intellectual property, but will not be secured by a lien on our real property, accounts receivable and related assets, cash accounts related to receivables and certain other assets. In addition, the notes and the guarantees will be secured by a portion of our stock and the stock or other equity interests of our subsidiaries. See “Description of Notes — Collateral.” The lenders under our amended revolving credit facility have a security interest in our accounts receivables and related assets and cash accounts related to receivables. | |
Optional Redemption | On or after November 1, 2006, we may redeem some or all of the notes at any time at the redemption prices described in the section entitled “Description of Notes — Optional Redemption.” |
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Mandatory Offer to Repurchase | If we or any of our restricted subsidiaries sell certain assets or if Holdings or we experience specific kinds of change of control, we must offer to purchase the notes at the prices set forth in the section of this prospectus entitled “Description of Notes — Repurchase at the Option of Holders.” | |
Basic Covenants of the Indenture | The indenture governing the notes restricts our ability and the ability of our restricted subsidiaries to: | |
• borrow money; | ||
• pay dividends on or redeem or repurchase capital stock; | ||
• make investments; | ||
• create liens; | ||
• use assets as security in other transactions; | ||
• sell certain assets or merge with or into other companies; | ||
• enter into certain transactions with affiliates; | ||
• sell stock in our subsidiaries; and | ||
• restrict dividends or payments by us. | ||
For more details, see the section entitled “Description of Notes — Certain Covenants.” | ||
Absence of a Public Market | There is no public market for the notes. We do not intend to apply for the notes to be listed on any securities exchange or to arrange for any quotation system to quote them. Accordingly, if an active public market does not develop, the market price and liquidity of the notes may be adversely affected. | |
Risk Factors | See the section entitled “Risk Factors” for a description of certain of the risks you should consider prior to participating in the exchange offer. |
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Income Statement Data: | ||||||||||||||||||||||||||||||||
Revenues | $ | 211,503 | $ | 63,678 | $ | 155,407 | $ | 237,752 | $ | 290,884 | $ | 316,873 | $ | 80,854 | $ | 78,708 | ||||||||||||||||
Gross profit | 49,631 | 17,991 | 39,823 | 57,708 | 57,463 | 48,716 | 14,109 | 12,463 | ||||||||||||||||||||||||
Income (loss) before income taxes | 16,425 | (6,748 | ) | 9 | 8,188 | 4,874 | (12,148 | ) | (1,310 | ) | (1,347 | ) | ||||||||||||||||||||
Net income (loss) | 13,801 | (4,648 | ) | 9 | 4,922 | 2,924 | (27,217 | ) | (786 | ) | (2,447 | ) | ||||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 23,254 | $ | — | $ | 17,783 | $ | 19,554 | $ | 30,412 | $ | 20,839 | $ | 41,277 | $ | 27,390 | ||||||||||||||||
Total assets | 321,056 | — | 499,401 | 577,317 | 675,631 | 624,523 | 676,507 | 625,268 | ||||||||||||||||||||||||
Total debt | 228,253 | — | 378,164 | 446,119 | 539,823 | 501,568 | 537,742 | 506,406 | ||||||||||||||||||||||||
Cash Flow Data: | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 50,682 | $ | 14,820 | $ | 39,601 | $ | 61,756 | $ | 60,120 | $ | 60,864 | $ | 20,822 | $ | 10,024 | ||||||||||||||||
Net cash used in investing activities | (23,442 | ) | (21,592 | ) | (221,563 | ) | (102,705 | ) | (142,250 | ) | (32,578 | ) | (8,027 | ) | (7,452 | ) | ||||||||||||||||
Net cash provided by (used in) financing activities | (31,119 | ) | (8,053 | ) | 199,475 | 42,720 | 92,988 | (37,859 | ) | (1,930 | ) | 3,979 |
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Other Data: | ||||||||||||||||||||||||||||||||
Capital expenditures | $ | 22,911 | $ | 20,852 | $ | 43,655 | $ | 56,967 | $ | 46,734 | $ | 30,459 | $ | 8,219 | $ | 13,885 | ||||||||||||||||
Adjusted EBITDA(2) | 80,953 | 25,012 | 59,017 | 95,047 | 104,289 | 98,313 | 26,002 | 23,517 | ||||||||||||||||||||||||
Depreciation and amortization | 41,134 | 9,823 | 26,462 | 49,345 | 58,733 | 65,601 | 16,348 | 15,774 | ||||||||||||||||||||||||
Number of fixed — site centers | 70 | — | 73 | 88 | 118 | 120 | 120 | 113 | ||||||||||||||||||||||||
Number of mobile facilities | 87 | — | 97 | 100 | 118 | 115 | 115 | 124 |
(1) | On October 17, 2001, Holdings acquired InSight pursuant to an agreement and plan of merger dated June 29, 2001, as amended. Holdings did not have any operating activities until October 17, 2001. Our financial information for the year ended June 30, 2002 reflects results for the entire fiscal year 2002 and does not include the results of operations of InSight from July 1, 2001 to October 17, 2001. InSight’s results of operations through October 17, 2001 do not reflect any purchase accounting adjustments. The results of operations for the fiscal year ended June 30, 2002 can be derived by combining our results of operations for the fiscal year ended June 30, 2002 with the results of operations of InSight from July 1, 2001 to October 17, 2001. These combined results of operations should be used for comparative purposes only as they do not purport to be indicative of what our results of operations would have been if we owned InSight for the entire fiscal year ended June 30, 2002. |
(2) | Adjusted EBITDA represents earnings before interest expenses, income taxes, depreciation and amortization excluding the acquisition related compensation charge for the period from July 1 to October 17, 2001 and the gain on repurchase of notes payable for the three months ended September 30, 2005. Adjusted EBITDA has been included because we believe that it is a useful tool for us and our investors to measure our ability to provide cash flows to meet debt service, capital expenditure and working capital requirements. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, income from company operations or other traditional indicators of operating performance and cash flow from operating activities determined in accordance with accounting principles generally accepted in the United States. We present this discussion of Adjusted EBITDA because covenants in the indenture governing our existing unsecured senior subordinated notes, the indenture governing the notes and the credit agreement relating to our amended revolving credit facility contain ratios based on this measure. While Adjusted EBITDA is used as a measure of liquidity and the ability to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation. Please see the reconciliation of net cash provided by operating activities to Adjusted EBITDA following these footnotes. |
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Net cash provided by operating activities | $ | 50,682 | $ | 14,820 | $ | 39,601 | $ | 61,756 | $ | 60,120 | $ | 60,864 | $ | 20,822 | $ | 10,024 | ||||||||||||||||
Provision (benefit) for income taxes | 2,624 | (2,100 | ) | — | 3,266 | 1,950 | 15,069 | (524 | ) | 1,100 | ||||||||||||||||||||||
Interest expense, net | 23,394 | 6,321 | 32,546 | 37,514 | 40,682 | 44,860 | 10,964 | 12,166 | ||||||||||||||||||||||||
Write-off of debt issuance costs | — | — | (7,378 | ) | — | — | — | — | — | |||||||||||||||||||||||
(Loss) gain on sales of centers | — | — | — | — | 2,129 | (170 | ) | — | — | |||||||||||||||||||||||
Net change in operating assets and liabilities | 4,253 | 5,971 | (5,752 | ) | (7,489 | ) | (592 | ) | (7,086 | ) | (5,260 | ) | 1,277 | |||||||||||||||||||
Net change in deferred income taxes | — | — | — | — | — | (15,224 | ) | — | (1,050 | ) | ||||||||||||||||||||||
Adjusted EBITDA | $ | 80,953 | $ | 25,012 | $ | 59,017 | $ | 95,047 | $ | 104,289 | $ | 98,313 | $ | 26,002 | $ | 23,517 | ||||||||||||||||
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Our substantial debt could adversely affect our financial condition and prevent us from fulfilling our obligations under the notes. |
• | making it more difficult for us to satisfy our obligations with respect to the notes and our other debt; | |
• | limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements; | |
• | requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes; | |
• | increasing our vulnerability to general adverse economic and industry conditions; | |
• | limiting our flexibility in planning for and reacting to changes in the industry in which we compete; | |
• | placing us at a disadvantage compared to other less leveraged competitors; and | |
• | increasing our cost of borrowing. |
The capital stock and other securities securing the notes will automatically be released from the liens securing the notes and no longer be deemed to be collateral to the extent the pledge of such capital stock or other equity interests would require the filing of separate financial statements for InSight or any of our subsidiaries with the SEC. Therefore, a portion of InSight’s, and our other subsidiaries’, capital stock will not be part of the collateral. |
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Not all of our subsidiaries guarantee our obligations under the notes, and the assets of our non-guarantor subsidiaries may not be available to make payments on the notes. |
We may be unable to service our debt, including the notes. |
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Our operations may be restricted by the terms of our debt, which could adversely affect us and increase our credit risk. |
• | incur more debt; | |
• | create liens; | |
• | pay dividends and make distributions or repurchase stock; | |
• | make investments; | |
• | merge or consolidate or transfer or sell assets; and | |
• | engage in transactions with affiliates. |
We will in most cases have control over the collateral, and the sale of particular assets by us could reduce the pool of assets securing the notes and the guarantees. |
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There are circumstances other than repayment or discharge of the notes under which the collateral securing the notes and guarantees will be released automatically, without your consent or the consent of the trustee. |
• | a taking by eminent domain, condemnation or other similar circumstances; | |
• | a sale, transfer or other disposal of such collateral in a transaction not prohibited under the indenture; or | |
• | with respect to collateral held by a guarantor, upon the release of such guarantor from its guarantee of any other indebtedness secured equally and ratably with the notes in accordance with the indenture. |
If there is a default, the value of the collateral may not be sufficient to repay holders of the notes. |
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Bankruptcy laws may limit your ability to realize value from the collateral. |
The imposition of certain permitted liens will cause the assets on which such liens are imposed to be excluded from the collateral securing the notes and the guarantees. There are certain other categories of assets that are also excluded from the collateral. |
The collateral is subject to casualty risks. |
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The collateral agent’s ability to exercise remedies is limited. |
We may not have sufficient funds to purchase the notes and our other senior debt upon a change of control. |
Rights of holders of the notes in the collateral may be adversely affected by the failure to perfect security interests in certain collateral or the perfection of liens on the collateral by other creditors. |
Federal and state statutes allow courts, under specific circumstances, to void the guarantees to be provided by the guarantors and require the holders of the notes to return payments received from the guarantors. |
• | the guarantee was incurred with the intent to hinder, delay or defraud any of such guarantor’s present or future creditors; or |
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• | the guarantor, at the time the debt evidenced by the guarantee was incurred, received less than reasonably equivalent value or fair consideration for the incurrence of such debt, and | |
• | was insolvent or rendered insolvent by reason of such incurrence, | |
• | was engaged in a business or transaction for which such guarantor’s remaining assets constituted unreasonably small capital, or | |
• | intended to incur, or believed that it would incur, debts beyond its ability to pay such debts as they mature. |
• | the sum of its debts, including contingent liabilities, were greater than the fair saleable value of all of its assets; | |
• | the present fair saleable value of its assets were less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature; or | |
• | it could not pay its debts as they become due. |
Rises in interest rates could adversely affect our financial condition. |
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There is no established trading market for the notes and it may be difficult for you to sell or pledge your notes. |
Changes in the rates or methods of third-party reimbursements for diagnostic imaging and therapeutic services could result in reduced demand for our services or create downward pricing pressure, which would result in a decline in our revenues and harm our financial position. |
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If we are unable to renew our existing customer contracts on favorable terms or at all, our financial results would be adversely affected. |
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We have experienced, and will continue to experience, competition from hospitals, physician groups and other diagnostic imaging companies and this competition could adversely affect our revenues and our business. |
Managed care organizations may limit healthcare providers from using our services, causing us to lose procedure volume. |
Technological change in our industry could reduce the demand for our services and require us to incur significant costs to upgrade our equipment. |
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Our ability to maximize the utilization of our diagnostic imaging equipment may be adversely impacted by harsh weather conditions. |
Because a high percentage of our operating expenses are fixed, a relatively small decrease in revenues could have a significant negative impact on our financial results. |
We may be subject to professional liability risks which could be costly and negatively impact our business and financial results. |
Our failure to effectively integrate acquisitions and establish joint venture arrangements through partnerships with hospitals and other healthcare providers could impair our business. |
• | demands on management related to the increase in our size after an acquisition; | |
• | the diversion of our management’s attention from the management of daily operations to the integration of operations; |
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• | integration of information systems; | |
• | risks associated with unanticipated events or liabilities; | |
• | difficulties in the assimilation and retention of employees; | |
• | potential adverse effects on operating results; | |
• | challenges in retaining customers and referral sources; and | |
• | amortization or write-offs of acquired intangible assets. |
Loss of, and failure to attract, qualified employees, particularly technologists, could limit our growth and negatively impact our operations. |
Our PET and PET/ CT service and some of our other imaging services require the use of radioactive materials, which could subject us to regulation, related costs and delays and potential liabilities for injuries or violations of environmental, health and safety laws. |
An earthquake could adversely affect our business and operations. |
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Continued high fuel costs would harm our operations. |
Complying with federal and state regulations pertaining to our business is an expensive and time-consuming process, and any failure to comply could result in substantial penalties. |
• | the federal False Claims Act; | |
• | the federal Medicare and Medicaid Anti-kickback Law, and state anti-kickback prohibitions; | |
• | the federal Civil Money Penalty Law; | |
• | the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA; | |
• | the federal physician self-referral prohibition commonly known as the Stark Law and the state law equivalents of the Stark Law; | |
• | state laws that prohibit the practice of medicine by non-physicians, and prohibit fee-splitting arrangements involving physicians; | |
• | United States Food and Drug Administration requirements; | |
• | state licensing and certification requirements, including certificates of need; and | |
• | federal and state laws governing the diagnostic imaging and therapeutic equipment used in our business concerning patient safety, equipment operating specifications and radiation exposure levels. |
The regulatory framework is uncertain and evolving. |
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• | within 120 days after the date on which the initial notes were issued, file the exchange offer registration statement, of which this prospectus is a part; | |
• | cause the exchange offer registration statement to be declared effective under the Securities Act within 180 days after the date on which the initial notes were issued; | |
• | keep the exchange offer open for at least 30 business days, or longer if required by applicable law, after the date notice of the exchange offer is mailed to the holders of the initial notes; and | |
• | cause the exchange offer to be completed within 210 days after the date on which the initial notes were issued. |
• | because of any change in law or in currently prevailing interpretations of the staff of the SEC, we are not permitted to effect an exchange offer, | |
• | in some circumstances, the holders of initial notes so request, or | |
• | the exchange offer has not been completed by the 210th day after the date on which the initial notes were issued. |
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(1) the exchange notes bear a different CUSIP Number from the initial notes; | |
(2) the exchange notes have been registered under the Securities Act and hence will not bear legends restricting their transfer; and | |
(3) the holders of the exchange notes will not be entitled to certain rights under the registration rights agreement, including the provisions providing for an increase in the interest rate on the initial notes in certain circumstances relating to the timing of the exchange offer, all of which rights will terminate when the exchange offer is terminated. |
• | notify the exchange agent of any extension orally or in writing; and | |
• | publicly announce the extension, including disclosure of the approximate number of initial notes deposited to date, |
• | to delay accepting any initial notes; | |
• | to extend or amend the terms of the exchange offer; or |
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• | if any conditions listed below under “— Conditions” are not satisfied, to terminate the exchange offer by giving oral or written notice of the delay, extension or termination to the exchange agent. |
• | Any exchange notes to be received by the holder will be acquired in the ordinary course of its business. | |
• | At the time of the commencement of the exchange offer, the holder has no arrangement or understanding with any person to participate in the distribution, within the meaning of Securities Act, of the exchange notes in violation of the Securities Act. | |
• | The holder is not our affiliate as defined in Rule 405 promulgated under the Securities Act. | |
• | If the holder is not a broker-dealer, it is not engaged in, and does not intend to engage in, the distribution of exchange notes. | |
• | If the holder is a broker-dealer that will receive exchange notes for its own account in exchange for initial notes that were acquired as a result of market-making or other trading activities, the holder will deliver a prospectus in connection with any resale of the exchange notes. We refer to these broker-dealers as participating broker-dealers. | |
• | The holder is not acting on behalf of any person or entity that could not truthfully make these representations. |
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• | the holder tenders through an eligible guarantor institution and signs a notice of guaranteed delivery; | |
• | on or prior to the expiration date, the exchange agent receives from the holder and the eligible guarantor institution a written or facsimile copy of a properly completed and duly executed notice of guaranteed delivery, substantially in the form provided by us, setting forth the name and address of the holder, the certificate number or numbers of the tendered initial notes, and the principal amount of tendered initial notes, stating that the tender is being made thereby and guaranteeing that, within five business days after the date of delivery of the notice of guaranteed delivery, the tendered initial notes, a duly executed letter of transmittal and any other required documents will be deposited by the eligible guarantor institution with the exchange agent; and |
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• | such properly completed and executed documents required by the letter of transmittal and the tendered initial notes in proper form for transfer are received by the exchange agent within five business days after the expiration date. |
• | specify the name of the person having deposited the initial notes to be withdrawn; | |
• | identify the initial notes to be withdrawn, including the certificate number(s) and principal amount of the initial notes, or, in the case of initial notes transferred by book-entry transfer, the name and number of the account at DTC to be credited; | |
• | be signed by the holder in the same manner as the initial signature on the letter of transmittal by which the initial notes were tendered, including any required signature guarantees, or be accompanied by documents of transfer sufficient to have the trustee with respect to the initial notes register the transfer of the initial notes into the name of the person withdrawing the tender; and | |
• | specify the name in which any initial notes are to be registered, if different from that of the person depositing the initial notes to be withdrawn. |
• | any action or proceeding is instituted or threatened in any court or by or before any governmental agency with respect to the exchange offer which, in our sole judgment, might materially impair our ability to proceed with the exchange offer or any material adverse development has occurred in any existing action or proceeding with respect to us or any of our subsidiaries; or | |
• | any law, statute, rule, regulation or interpretation by the staff of the SEC is proposed, adopted or enacted, which, in our sole judgment, might materially impair our ability to proceed with the exchange offer or materially impair the contemplated benefits of the exchange offer to us; or | |
• | any governmental approval has not been obtained, which approval we will, in our sole discretion, deem necessary for the consummation of the exchange offer as contemplated by this prospectus. |
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(1) to us upon redemption thereof or otherwise; | |
(2) so long as the initial notes are eligible for resale pursuant to Rule 144A, to a person inside the United States whom the seller reasonably believes is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act in a transaction meeting the requirements of Rule 144A, in accordance with Rule 144 under the Securities Act, or pursuant to another exemption from the registration requirements of the Securities Act, which other exemption is based upon an opinion of counsel reasonably acceptable to us; | |
(3) outside the United States to a foreign person in a transaction meeting the requirements of Rule 904 under the Securities Act; or | |
(4) pursuant to an effective registration statement under the Securities Act, in each case in accordance with any applicable securities laws of any state of the United States. |
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period | ||||||||||||||||||||||||||||||||
from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Income Statement Data: | ||||||||||||||||||||||||||||||||
Revenues | $ | 211,503 | $ | 63,678 | $ | 155,407 | $ | 237,752 | $ | 290,884 | $ | 316,873 | $ | 80,854 | $ | 78,708 | ||||||||||||||||
Costs of operations | 161,872 | 45,687 | 115,584 | 180,044 | 233,421 | 268,157 | 66,745 | 66,245 | ||||||||||||||||||||||||
Gross profit | 49,631 | 17,991 | 39,823 | 57,708 | 57,463 | 48,716 | 14,109 | 12,463 | ||||||||||||||||||||||||
Corporate operating expenses | (10,783 | ) | (3,184 | ) | (7,705 | ) | (13,750 | ) | (16,217 | ) | (18,447 | ) | (4,855 | ) | (5,553 | ) | ||||||||||||||||
Acquisition related compensation charge | — | (15,616 | ) | — | — | — | — | — | — | |||||||||||||||||||||||
(Loss) gain on sales of centers | — | — | — | — | 2,129 | (170 | ) | — | — | |||||||||||||||||||||||
Equity in earnings of unconsolidated subsidiaries | 971 | 382 | 437 | 1,744 | 2,181 | 2,613 | 400 | 833 | ||||||||||||||||||||||||
Interest expense, net | (23,394 | ) | (6,321 | ) | (32,546 | ) | (37,514 | ) | (40,682 | ) | (44,860 | ) | (10,964 | ) | (12,166 | ) | ||||||||||||||||
Gain on repurchase of notes payable | — | — | — | — | — | — | — | 3,076 | ||||||||||||||||||||||||
Income (loss) before income taxes | 16,425 | (6,748 | ) | 9 | 8,188 | 4,874 | (12,148 | ) | (1,310 | ) | (1,347 | ) | ||||||||||||||||||||
Provision (benefit) for income taxes | 2,624 | (2,100 | ) | — | 3,266 | 1,950 | 15,069 | (524 | ) | 1,100 | ||||||||||||||||||||||
Net income (loss) | $ | 13,801 | $ | (4,648 | ) | $ | 9 | $ | 4,922 | $ | 2,924 | $ | (27,217 | ) | $ | (786 | ) | $ | (2,447 | ) | ||||||||||||
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InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period | ||||||||||||||||||||||||||||||||
from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 23,254 | $ | — | $ | 17,783 | $ | 19,554 | $ | 30,412 | $ | 20,839 | $ | 41,277 | $ | 27,390 | ||||||||||||||||
Working capital | 16,791 | — | 35,907 | 32,580 | 48,116 | 36,068 | 53,629 | 41,262 | ||||||||||||||||||||||||
Total assets | 321,056 | — | 499,401 | 577,317 | 675,631 | 624,523 | 676,507 | 625,268 | ||||||||||||||||||||||||
Total debt | 228,253 | — | 378,164 | 446,119 | 539,823 | 501,568 | 537,742 | 506,406 | ||||||||||||||||||||||||
Stockholders’ equity | 65,471 | — | 87,376 | 91,614 | 94,941 | 67,724 | 94,155 | 65,277 | ||||||||||||||||||||||||
Cash Flow Data: | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 50,682 | $ | 14,820 | $ | 39,601 | $ | 61,756 | $ | 60,120 | $ | 60,864 | $ | 20,822 | $ | 10,024 | ||||||||||||||||
Net cash used in investing activities | (23,442 | ) | (21,592 | ) | (221,563 | ) | (102,705 | ) | (142,250 | ) | (32,578 | ) | (8,027 | ) | (7,452 | ) | ||||||||||||||||
Net cash provided by (used in) financing activities | (31,119 | ) | (8,053 | ) | 199,475 | 42,720 | 92,988 | (37,859 | ) | (1,930 | ) | 3,979 | ||||||||||||||||||||
Other Data: | ||||||||||||||||||||||||||||||||
Capital expenditures | $ | 22,911 | $ | 20,852 | $ | 43,655 | $ | 56,967 | $ | 46,734 | $ | 30,459 | $ | 16,348 | $ | 13,885 | ||||||||||||||||
Adjusted EBITDA(2) | 80,953 | 25,012 | 59,017 | 95,047 | 104,289 | 98,313 | 26,002 | 23,517 | ||||||||||||||||||||||||
Depreciation and amortization | 41,134 | 9,823 | 26,462 | 49,345 | 58,733 | 65,601 | 16,348 | 15,774 | ||||||||||||||||||||||||
Number of fixed — site centers | 70 | — | 73 | 88 | 118 | 120 | 120 | 113 | ||||||||||||||||||||||||
Number of mobile facilities | 87 | — | 97 | 100 | 118 | 115 | 115 | 124 |
(1) | On October 17, 2001, Holdings acquired InSight pursuant to an agreement and plan of merger dated June 29, 2001, as amended. Holdings did not have any operating activities until October 17, 2001. Our financial information for the year ended June 30, 2002 reflects results for the entire fiscal year 2002 and does not include the results of operations of InSight from July 1, 2001 to October 17, 2001. InSight’s results of operations through October 17, 2001 do not reflect any purchase accounting adjustments. The results of operations for the fiscal year ended June 30, 2002 can be derived by combining our results of operations for the fiscal year ended June 30, 2002 with the results of operations of InSight from July 1, 2001 to October 17, 2001. These combined results of operations should be used for comparative purposes only as they do not purport to be indicative of what our results of operations would have been if we owned InSight for the entire fiscal year ended June 30, 2002. |
(2) | Adjusted EBITDA represents earnings before interest expenses, income taxes, depreciation and amortization excluding the acquisition related compensation charge for the period from July 1 to October 17, 2001 and the gain on repurchase of notes payable for the three months ended September 30, 2005. Adjusted EBITDA has been included because we believe that it is a useful tool for us and our investors to measure our ability to provide cash flows to meet debt service, capital expenditure and working capital requirements. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, income from company operations or other traditional indicators of operating performance and cash flow from operating activities determined in accordance with accounting principles generally accepted in the United States. We present this discussion of Adjusted EBITDA because covenants in the indenture governing our existing unsecured senior subordinated notes, the indenture governing the notes and the credit agreement relating to our amended revolving credit facility contain ratios based on this measure. While Adjusted EBITDA is |
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used as a measure of liquidity and the ability to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation. Please see the reconciliation of net cash provided by operating activities to Adjusted EBITDA following these footnotes. |
InSight (Predecessor) | Holdings | |||||||||||||||||||||||||||||||
Period | ||||||||||||||||||||||||||||||||
from | Three Months Ended | |||||||||||||||||||||||||||||||
Year Ended | July 1 to | Years Ended June 30, | September 30, | |||||||||||||||||||||||||||||
June 30, | October 17, | |||||||||||||||||||||||||||||||
2001 | 2001(1) | 2002(1) | 2003 | 2004 | 2005 | 2004 | 2005 | |||||||||||||||||||||||||
Net cash provided by operating activities | $ | 50,682 | $ | 14,820 | $ | 39,601 | $ | 61,756 | $ | 60,120 | $ | 60,864 | $ | 20,822 | $ | 10,024 | ||||||||||||||||
Provision (benefit) for income taxes | 2,624 | (2,100 | ) | — | 3,266 | 1,950 | 15,069 | (524 | ) | 1,100 | ||||||||||||||||||||||
Interest expense, net | 23,394 | 6,321 | 32,546 | 37,514 | 40,682 | 44,860 | 10,964 | 12,166 | ||||||||||||||||||||||||
Write-off of debt issuance costs | — | — | (7,378 | ) | — | — | — | — | — | |||||||||||||||||||||||
(Loss) gain on sales of centers | — | — | — | — | 2,129 | (170 | ) | — | — | |||||||||||||||||||||||
Net change in operating assets and liabilities | 4,253 | 5,971 | (5,752 | ) | (7,489 | ) | (592 | ) | (7,086 | ) | (5,260 | ) | 1,277 | |||||||||||||||||||
Net change in deferred income taxes | — | — | — | — | — | (15,224 | ) | — | (1,050 | ) | ||||||||||||||||||||||
Adjusted EBITDA | $ | 80,953 | $ | 25,012 | $ | 59,017 | $ | 95,047 | $ | 104,289 | $ | 98,313 | $ | 26,002 | $ | 23,517 | ||||||||||||||||
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• | attract patient referrals from physician groups and hospitals; | |
• | increase procedure volume to maximize equipment utilization; | |
• | maintain our existing contracts and enter into new ones with managed care organizations and commercial insurance carriers; and | |
• | develop new fixed-site centers. |
• | attractive financing arrangements by equipment manufacturers which have increased competition in our targeted regions, including by physician owned imaging facilities; | |
• | industry-wide increases in salaries and benefits for technologists; | |
• | increases in deductibles and co-payment charges to patients; | |
• | increases in the preauthorization requirements applicable to diagnostic imaging services by certain managed care organizations and state Medicaid programs; | |
• | reductions in reimbursement from certain third-party payors including proposed reductions from Medicare; and | |
• | reductions in reimbursement as a result of patient referrals from “third-party gatekeeper organizations.” |
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• | establish new mobile customers within our targeted regions; | |
• | structure efficient mobile routes that maximize equipment utilization; and | |
• | renew existing mobile contracts with our hospital, physician group and other healthcare provider customers. |
• | increases in competition in our targeted regions from other mobile service providers; | |
• | industry-wide increases in salaries and benefits for technologists; | |
• | reductions in reimbursement from certain third-party payors including proposed reductions from Medicare; | |
• | attractive financing arrangements by equipment manufacturers which cause some of our customers and some of our customers’ referral sources to invest in their own diagnostic imaging equipment; and | |
• | a reduction in outpatient volumes at our fee-for-service customers due to increased deductibles and co-payment charges to patients. |
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Percent of Total Revenues | ||||||||
Hospitals, physician groups, and other healthcare providers(1) | 45 | % | ||||||
Managed care and insurance | 37 | % | ||||||
Medicare/ Medicaid | 14 | % | ||||||
Workers’ compensation | 3 | % | ||||||
Other, including self-pay patients | 1 | % |
(1) | No single hospital, physician group or other healthcare provider accounted for more than 5% of our total revenues. |
120 days | |||||||||||||||||||||||||
Current | 30 days | 60 days | 90 days | and older | Total | ||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Hospitals, physicians groups and other healthcare providers | $ | 11,486 | $ | 6,944 | $ | 925 | $ | 474 | $ | 583 | $ | 20,412 | |||||||||||||
Managed care and insurance | 21,604 | 9,897 | 4,988 | 2,939 | 12,121 | 51,549 | |||||||||||||||||||
Medicare/ Medicaid | 7,281 | 2,107 | 947 | 776 | 3,894 | 15,005 | |||||||||||||||||||
Workers’ compensation | 1,670 | 1,077 | 740 | 506 | 2,256 | 6,249 | |||||||||||||||||||
Other, including self-pay patients | 270 | 170 | 116 | 105 | 133 | 794 | |||||||||||||||||||
Trade accounts receivables | 42,311 | 20,195 | 7,716 | 4,800 | 18,987 | 94,009 | |||||||||||||||||||
Less: Allowances for contractual adjustments | (13,806 | ) | (5,851 | ) | (3,073 | ) | (262 | ) | (4,767 | ) | (27,759 | ) | |||||||||||||
Allowances for professional fees | (5,045 | ) | (2,199 | ) | (1,137 | ) | (703 | ) | (2,561 | ) | (11,645 | ) | |||||||||||||
Allowances for doubtful accounts | (332 | ) | (176 | ) | (65 | ) | (1,776 | ) | (6,090 | ) | (8,439 | ) | |||||||||||||
Trade accounts receivables, net | $ | 23,128 | $ | 11,969 | $ | 3,441 | $ | 2,059 | $ | 5,569 | $ | 46,166 | |||||||||||||
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Three Months | ||||||||||||||||||||||
Ended | ||||||||||||||||||||||
Years Ended June 30, | September 30, | |||||||||||||||||||||
2005 | 2004 | 2003 | 2005 | 2004 | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
REVENUES | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||
COSTS OF OPERATIONS: | ||||||||||||||||||||||
Costs of services | 61.4 | 58.0 | 52.9 | 61.3 | 59.9 | |||||||||||||||||
Provision for doubtful accounts | 1.8 | 1.7 | 1.7 | 1.5 | 2.0 | |||||||||||||||||
Equipment leases | 0.7 | 0.3 | 0.3 | 1.3 | 0.4 | |||||||||||||||||
Depreciation and amortization | 20.7 | 20.2 | 20.7 | 20.0 | 20.2 | |||||||||||||||||
Total costs of operations | 84.6 | 80.2 | 75.6 | 84.1 | 82.5 | |||||||||||||||||
Gross profit | 15.4 | 19.8 | 24.4 | 15.9 | 17.5 | |||||||||||||||||
CORPORATE OPERATING EXPENSES | (5.8 | ) | (5.6 | ) | (5.8 | ) | (7.1 | ) | (6.0 | ) | ||||||||||||
(LOSS) GAIN ON SALES OF CENTERS | — | 0.7 | — | |||||||||||||||||||
EQUITY IN EARNINGS OF UNCONSOLIDATED PARTNERSHIPS | 0.8 | 0.8 | 0.7 | 1.1 | 0.5 | |||||||||||||||||
INTEREST EXPENSE, net | (14.2 | ) | (14.0 | ) | (15.8 | ) | (15.5 | ) | (13.6 | ) | ||||||||||||
GAIN ON REPURCHASE OF NOTES PAYABLE | — | — | — | 3.9 | — | |||||||||||||||||
(Loss) income before income taxes | (3.8 | ) | 1.7 | 3.5 | (1.7 | ) | (1.6 | ) | ||||||||||||||
PROVISION FOR INCOME TAXES | 4.8 | 0.7 | 1.4 | 1.4 | (0.6 | ) | ||||||||||||||||
Net (loss) income | (8.6 | )% | 1.0 | % | 2.1 | % | (3.1 | )% | (1.0 | )% | ||||||||||||
Three Months | ||||||||||||||||||||
Ended | ||||||||||||||||||||
Years Ended June 30, | September 30, | |||||||||||||||||||
2005 | 2004 | 2003 | 2005 | 2004 | ||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Fixed operations | $ | 196,482 | $ | 176,763 | $ | 139,816 | $ | 48,732 | $ | 50,798 | ||||||||||
Mobile operations | 120,391 | 114,121 | 97,936 | 29,976 | 30,056 | |||||||||||||||
Total | $ | 316,873 | $ | 290,884 | $ | 237,752 | $ | 78,708 | $ | 80,854 | ||||||||||
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Years Ended June 30, 2005 and 2004 |
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Years Ended June 30, 2004 and 2003 |
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• | interest payments relating to the notes and our 97/8% unsecured senior subordinated notes; | |
• | capital expenditures; | |
• | working capital requirements to support business growth; and | |
• | potential acquisitions. |
• | the volume of patients at our fixed-site centers; | |
• | the demand for our mobile services; | |
• | our ability to control expenses; and | |
• | our ability to collect our trade accounts receivables from third-party payors, hospitals, physician groups, other healthcare providers and patients. |
Three Months Ended | ||||||||||||||||||||
Years Ended June 30, | September 30, | |||||||||||||||||||
2005 | 2004 | 2003 | 2005 | 2004 | ||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Net cash provided by operating activities | $ | 60,864 | $ | 60,120 | $ | 61,756 | $ | 10,024 | $ | 20,822 | ||||||||||
Net cash used in investing activities | (32,578 | ) | (142,250 | ) | (102,705 | ) | (7,452 | ) | (8,027 | ) | ||||||||||
Net cash (used in) provided by financing activities | (37,859 | ) | 92,988 | 42,720 | 3,979 | (1,930 | ) | |||||||||||||
Increase (decrease) in cash and cash equivalents | $ | (9,573 | ) | $ | 10,858 | $ | 1,771 | $ | 6,551 | $ | 10,865 | |||||||||
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Three Months Ended | |||||||||||||||||||||
Years Ended June 30, | September 30, | ||||||||||||||||||||
2005 | 2004 | 2003 | 2005 | 2004 | |||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||||||
Net cash provided by operating activities | $ | 60,864 | $ | 60,120 | $ | 61,756 | $ | 10,024 | $ | 20,822 | |||||||||||
Provision for income taxes | 15,069 | 1,950 | 3,266 | 1,100 | (524 | ) | |||||||||||||||
Interest expense, net | 44,860 | 40,682 | 37,514 | 12,166 | 10,964 | ||||||||||||||||
(Loss) gain on sales of centers | (170 | ) | 2,129 | — | |||||||||||||||||
Net change in operating assets and liabilities | (7,086 | ) | (592 | ) | (7,489 | ) | 1,277 | (5,260 | ) | ||||||||||||
Net change in deferred income taxes | (15,224 | ) | — | — | (1,050 | ) | — | ||||||||||||||
Adjusted EBITDA | $ | 98,313 | $ | 104,289 | $ | 95,047 | $ | 23,517 | $ | 26,002 | |||||||||||
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Payments Due by Period | ||||||||||||||||||||
Less than | 1-3 | 3-5 | After | |||||||||||||||||
Total | 1 Year | Years | Years | 5 Years | ||||||||||||||||
Long-term debt obligations(1) | $ | 799,018 | $ | 46,989 | $ | 93,978 | $ | 93,458 | $ | 564,593 | ||||||||||
Capital lease obligations | 14,711 | 5,802 | 8,583 | 326 | — | |||||||||||||||
Operating lease obligations | 41,087 | 9,035 | 15,594 | 8,566 | 7,892 | |||||||||||||||
Purchase commitments | 11,180 | 11,180 | — | — | — | |||||||||||||||
Total contractual obligations | $ | 865,996 | $ | 73,006 | $ | 118,155 | $ | 102,350 | $ | 572,485 | ||||||||||
(1) | Long-term debt obligations are presented on a pro forma basis to give pro forma affect to the offering of the initial notes as if it had been completed on July 1, 2005. |
Off-Balance Sheet Arrangements |
Critical Accounting Policies and Estimates |
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Magnetic Resonance Imaging or MRI |
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Positron Emission Tomography or PET |
Computed Tomography or CT |
Other Imaging Technologies |
• | Ultrasound systems use, detect and process high frequency sound waves to generate images of soft tissues and internal body organs. | |
• | X-ray is the most common energy source used in imaging the body and is now employed in conventional x-ray systems, CT scanners and digital x-ray systems. | |
• | Mammography is a low-level conventional examination of the breasts. Its primary purpose is to detect lesions in the breast that may be too small or deeply buried to be felt in a regular breast examination. | |
• | Bone densitometry uses an advanced technology called dual-energy x-ray absorptiometry, or DEXA, which safely, accurately and painlessly measures bone density and the mineral content of bone for the diagnosis of osteoporosis. |
• | broadening our physician referral base and generating new sources of revenues through selective marketing activities; | |
• | focusing our marketing efforts on attracting additional managed care customers; | |
• | expanding current imaging applications of existing modalities to increase overall procedure volume; and | |
• | maximizing cost efficiencies through increased purchasing power and continued reduction of expenses. |
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• | Failure to comply with the many technical billing requirements applicable to our Medicare and Medicaid business. |
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• | Failure to comply with Medicare requirements concerning the circumstances in which a hospital, rather than we, must bill Medicare for diagnostic imaging services we provide to outpatients treated by the hospital. | |
• | Failure of our hospital customers to accurately identify and report our reimbursable and allowable services to Medicare. | |
• | Failure to comply with the prohibition against billing for services ordered or supervised by a physician who is excluded from any federal healthcare programs, or the prohibition against employing or contracting with any person or entity excluded from any federal healthcare programs. | |
• | Failure to comply with the Medicare physician supervision requirements for the services we provide, or the Medicare documentation requirements concerning physician supervision. | |
• | The past conduct of the businesses we have acquired. |
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Michael N. Cannizzaro | 56 | Chairman of the Board and Director | ||
Bret W. Jorgensen | 46 | President and Chief Executive Officer and Director | ||
Patricia R. Blank | 55 | Executive Vice President — Enterprise Operations of InSight | ||
Michael A. Boylan | 49 | Executive Vice President — Enterprise Development of InSight | ||
Louis E. Hallman, III | 46 | Executive Vice President and Chief Strategy Officer of InSight | ||
Donald F. Hankus | 44 | Executive Vice President and Chief Information Officer of InSight | ||
Mitch C. Hill | 46 | Executive Vice President and Chief Financial Officer | ||
Marilyn U. MacNiven-Young | 54 | Executive Vice President, General Counsel and Secretary | ||
Kenneth M. Doyle | 40 | Director and Vice President | ||
David W. Dupree | 52 | Director | ||
Steven G. Segal | 45 | Director | ||
Mark J. Tricolli | 34 | Director and Vice President | ||
Edward D. Yun | 38 | Director and Vice President |
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Annual Compensation | Long Term | ||||||||||||||||||||||||
Compensation | |||||||||||||||||||||||||
Fiscal | Awards Stock | ||||||||||||||||||||||||
Year | Options | All Other | |||||||||||||||||||||||
Name and Principal Position | Ended | Salary | Bonus(1) | Other(2) | (Shares) | Comp(2) | |||||||||||||||||||
Michael N. Cannizzaro(3) | 2005 | $ | — | $ | — | $ | — | 40,000 | $ | — | |||||||||||||||
Chairman of the Board of | 2004 | — | — | — | — | — | |||||||||||||||||||
Directors | 2003 | — | — | — | — | — | |||||||||||||||||||
Steven T. Plochocki(4) | 2005 | $ | 45,200 | $ | — | $ | 1,500 | — | $ | 13,536 | |||||||||||||||
President and Chief Executive | 2004 | 420,000 | 105,000 | 9,000 | — | 30,344 | |||||||||||||||||||
Officer | 2003 | 350,000 | — | 9,000 | — | 6,418 | |||||||||||||||||||
Michael A. Boylan(5) | 2005 | $ | 275,000 | $ | 97,000 | $ | 9,000 | — | $ | 29,872 | |||||||||||||||
Executive Vice President — | 2004 | 249,700 | 82,950 | 9,000 | — | 25,692 | |||||||||||||||||||
Enterprise Development | 2003 | 237,000 | — | 9,000 | — | 7,150 | |||||||||||||||||||
Patricia R. Blank(6) | 2005 | $ | 275,000 | $ | 97,000 | $ | 9,000 | 30,000 | $ | 31,873 | |||||||||||||||
Executive Vice President — | 2004 | 224,700 | 42,000 | 9,000 | — | 30,367 | |||||||||||||||||||
Enterprise Operations | 2003 | 210,000 | — | 9,000 | — | 7,682 | |||||||||||||||||||
Marilyn U. MacNiven-Young | 2005 | $ | 275,000 | $ | 85,000 | $ | 9,000 | 10,000 | $ | 14,087 | |||||||||||||||
Executive Vice President, | 2004 | 267,500 | 52,400 | 9,000 | — | 12,644 | |||||||||||||||||||
General Counsel and Secretary | 2003 | 262,000 | — | 9,000 | — | 4,333 | |||||||||||||||||||
Mitch C. Hill(7) | 2005 | $ | 121,600 | $ | 55,000 | $ | 4,500 | 40,000 | $ | 10,199 | |||||||||||||||
Executive Vice President and | 2004 | — | — | — | — | — | |||||||||||||||||||
Chief Financial Officer | 2003 | — | — | — | — | — |
(1) | Bonuses which are based on our performance are earned and accrued during the year and paid subsequent to the end of each year. Discretionary bonuses are earned and paid in the year in which they are awarded by InSight’s compensation committee. |
(2) | Amounts of Other Annual Compensation include perquisites (auto allowances and commissions for contract awards and renewals) and amounts of All Other Compensation include (i) amounts contributed to InSight’s 401(k) profit sharing plan, (ii) specified premiums on executive life insurance arrangements and (iii) specified premiums on executive health insurance arrangements. |
(3) | Mr. Cannizarro served as President and Chief Executive Officer from August 9, 2004 until July 1, 2005. |
(4) | Mr. Plochocki served as President and Chief Executive Officer until August 9, 2004. |
(5) | Effective October 22, 2004, Mr. Boylan’s title changed from Executive Vice President — Mobile Division and Business Development to Executive Vice President — Enterprise Development. |
(6) | Effective October 22, 2004, Ms. Blank’s title changed from Executive Vice President and Chief Information Officer to Executive Vice President — Enterprise Operations. |
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(7) | Mr. Hill also received a right to purchase 2,525 shares of our common stock at a price of $19.82 per share. This right expired on October 22, 2005. |
Individual Grants | Potential Realizable Value | |||||||||||||||||||||||||||
at Assumed Annual Rates | ||||||||||||||||||||||||||||
Number of | Percent of | of Stock Price | ||||||||||||||||||||||||||
Securities | Total Options | Appreciation for Option | ||||||||||||||||||||||||||
Underlying | Granted to | Market Price | Term(2) | |||||||||||||||||||||||||
Options | Employees in | Exercise Price | on Grant | Expiration | ||||||||||||||||||||||||
Name | Granted | Fiscal Year | Per Share(1) | Date | Date(3) | 5% | 10% | |||||||||||||||||||||
Michael N. Cannizzaro | 20,000 | 9.5 | % | $ | 19.82 | $ | 19.82 | 8/12/2014 | $ | 249,294 | $ | 631,760 | ||||||||||||||||
20,000 | 9.5 | % | 19.82 | 19.82 | 4/8/2015 | 249,294 | 631,760 | |||||||||||||||||||||
Steven T. Plochocki | — | — | — | — | — | — | — | |||||||||||||||||||||
Michael A. Boylan | — | — | — | — | — | — | — | |||||||||||||||||||||
Patricia R. Blank | 30,000 | 14.3 | % | 19.82 | 19.82 | 1/10/2015 | 373,941 | 947,640 | ||||||||||||||||||||
Marilyn U. MacNiven-Young | 10,000 | 4.8 | % | 19.82 | 19.82 | 1/10/2015 | 124,648 | 315,877 | ||||||||||||||||||||
Mitch C. Hill(4) | 40,000 | 19.1 | % | 19.82 | 19.82 | 1/10/2015 | 498,587 | 1,263,519 |
(1) | The options were granted at an exercise price of $19.82 per share, the estimated price per share determined by the board of directors. |
(2) | Potential realizable value is determined by taking the exercise price per share and applying the stated annual appreciation rate compounded annually for the remaining term of the option (ten years), subtracting the exercise price per share at the end of the period and multiplying the remaining number by the number of options granted. Actual gains, if any, on stock option exercises and the Company’s common stock holdings are dependent on the future performance of the common stock. |
(3) | Except for Mr. Cannizzaro’s options, which were fully exercisable on the date of grant, the other options are exercisable starting twelve months after the date of grant with 50% of the shares vesting annually on the following schedule: (i) 10% of the shares becoming exercisable upon the anniversary of the grant date in each of the fiscal years ending on June 30 in the years 2006-2010 and (ii) 50% of the shares becoming exercisable upon the attainment of certain performance targets on an exit event. The options were granted for a term of ten years, subject to earlier termination in certain events related to termination of employment. |
(4) | Mr. Hill also received a right to purchase 2,525 shares of our common stock at a price of $19.82 per share. This right expired on October 22, 2005. |
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Number of | Value of Unexercised | |||||||||||||||||||||||
Shares | Number of Unexercised | In-the-Money Options at | ||||||||||||||||||||||
Acquired | Options at June 30, 2005 | June 30, 2005(1) | ||||||||||||||||||||||
on | Value | |||||||||||||||||||||||
Name | Exercise | Realized | Exercisable | Unexercisable | Exercisable | Unexercisable | ||||||||||||||||||
Michael N. Cannizzaro | — | $ | — | 40,000 | — | $ | — | $ | — | |||||||||||||||
Steven T. Plochocki | — | — | 52,500 | — | 601,125 | — | ||||||||||||||||||
Michael A. Boylan | — | — | 57,490 | 59,500 | 557,146 | 108,290 | ||||||||||||||||||
Patricia R. Blank | — | — | 4,500 | 55,500 | 8,190 | 46,410 | ||||||||||||||||||
Marilyn U. MacNiven-Young | — | — | 4,500 | 35,500 | 8,190 | 46,410 | ||||||||||||||||||
Mitch C. Hill | — | — | — | 40,000 | — | — |
(1) | Based on the price at which the common stock was valued on that date of $19.82 per share. |
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Amount and Nature | Percent of | ||||||||
of Beneficial | Common Stock | ||||||||
Ownership of | Beneficially | ||||||||
Names and Addresses of Beneficial Owners | Common Stock(1) | Owned(1) | |||||||
J.W. Childs Equity Partners II, L.P.(2) | 4,350,290 | 79.5 | % | ||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
JWC-InSight Co-invest LLC(3) | 338,532 | 6.2 | % | ||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
Halifax Capital Partners, L.P.(4) | 1,111,112 | 20.3 | % | ||||||
1133 Connecticut Avenue, N.W. | |||||||||
Washington, D.C. 20036 | |||||||||
Steven G. Segal(5) | — | — | |||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
Edward D. Yun(6) | — | — | |||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
Michael N. Cannizzaro(7) | 40,000 | * | |||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
Mark J. Tricolli(8) | — | — | |||||||
111 Huntington Avenue, Suite 2900 | |||||||||
Boston, Massachusetts 02199 | |||||||||
David W. Dupree(9) | 4,092 | * | |||||||
1133 Connecticut Avenue, N.W. | |||||||||
Washington, D.C. 20036 | |||||||||
Kenneth M. Doyle(10) | — | — | |||||||
1133 Connecticut Avenue, N.W. | |||||||||
Washington, D.C. 20036 | |||||||||
Steven T. Plochocki(11)(12) | 52,500 | 1.0 | % | ||||||
26250 Enterprise Court, Suite 100 | |||||||||
Lake Forest, CA 92630 | |||||||||
Bret W. Jorgensen(13) | — | — | |||||||
26250 Enterprise Court, Suite 100 | |||||||||
Lake Forest, CA 92630 | |||||||||
Michael A. Boylan(14) | 64,490 | 1.2 | % | ||||||
110 Gibraltar Road | |||||||||
Horsham, PA 18901 | |||||||||
Mitch C. Hill(15) | — | — | |||||||
26250 Enterprise Court, Suite 100 | |||||||||
Lake Forest, CA 92630 |
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Amount and Nature | Percent of | ||||||||
of Beneficial | Common Stock | ||||||||
Ownership of | Beneficially | ||||||||
Names and Addresses of Beneficial Owners | Common Stock(1) | Owned(1) | |||||||
Marilyn U. MacNiven-Young(16) | 7,500 | * | |||||||
26250 Enterprise Court, Suite 100 | |||||||||
Lake Forest, CA 92630 | |||||||||
Patricia R. Blank(17) | 7,500 | * | |||||||
26250 Enterprise Court, Suite 100 | |||||||||
Lake Forest, CA 92630 | |||||||||
All directors and executive officers, as a group (13 persons)(18) | 123,532 | 2.2 | % |
(1) | For purposes of this table, a person is deemed to have “beneficial ownership” of any security that such person has the right to acquire within 60 days after October 31, 2005. |
(2) | Includes 4,011,758 shares of our common stock owned directly by J.W. Childs Equity Partners II, L.P. and 338,532 shares of our common stock owned directly by JWC-InSight Co-invest LLC, an affiliate of J.W. Childs Equity Partners II, L.P. The general partner of J.W. Childs Equity Partners II, L.P. is J.W. Childs Advisors II, L.P., a Delaware limited partnership. The general partner of J.W. Childs Advisors II, L.P. is J.W. Childs Associates, L.P., a Delaware limited partnership. The general partner of J.W. Childs Associates, L.P. is J.W. Childs Associates, Inc., a Delaware corporation. J.W. Childs Advisors II, L.P., J.W. Childs Associates, L.P. and J.W. Childs Associates, Inc. may be deemed to beneficially own the 4,350,290 shares of our common stock held by J.W. Childs Equity Partners II, L.P. and JWC-InSight Co-invest LLC. John W. Childs, Glenn A. Hopkins, Dana L. Schmaltz, Adam L. Suttin, William E. Watts, James Rhee and Jeffrey Teschke, as well as Steven G. Segal, Edward D. Yun, Michael N. Cannizzaro and Mark J. Tricolli (as indicated in footnotes 5, 6, 7, and 8, respectively) share voting and investment control over, and therefore may be deemed to beneficially own, the shares of common stock held by these entities. |
(3) | JWC-InSight Co-invest LLC is a Delaware limited liability company and affiliate of J.W. Childs Equity Partners II, L.P. J.W. Childs Associates, Inc. is the managing member of JWC-InSight Co-invest LLC. As the managing member, J.W. Childs Associates, Inc. owns the 338,532 shares of our common stock to be held directly by JWC-InSight Co-invest LLC. John W. Childs, Glenn A. Hopkins, Dana L. Schmaltz, Adam L. Suttin, William E. Watts, James Rhee and Jeffrey Teschke, as well as Steven G. Segal, Edward D. Yun, Michael N. Cannizzaro and Mark J. Tricolli (as indicated in footnotes 5, 6, 7, and 8, respectively) share voting and investment control over, and therefore may be deemed to beneficially own, the shares of common stock held by these entities. |
(4) | Includes 1,107,020 shares of our common stock owned directly by Halifax Capital Partners, L.P. and 4,092 shares of our common stock owned directly by Mr. Dupree, a Managing Director of The Halifax Group, L.L.C. The general partner of Halifax Capital Partners, L.P. is Halifax Genpar, L.P., a Delaware limited partnership. The general partner of Halifax Genpar, L.P. is The Halifax Group, L.L.C. a Delaware limited liability company. Halifax Genpar, L.P. and The Halifax Group, L.L.C. may be deemed to beneficially own the 1,111,112 shares of our common stock held by Halifax Capital Partners, L.P. and its affiliate, Mr. Dupree. Halifax Capital Partners, L.P., Halifax Genpar, L.P. and The Halifax Group, L.L.C. disclaim beneficial ownership of the 4,092 shares of our common stock owned directly by Mr. Dupree. William L. Rogers, A. Judson Hill, Michael T. Marshall and Brent D. Williams, as well as Mr. Dupree and Kenneth M. Doyle (as indicated in footnotes 9 and 10, respectively) share voting and investment control over, and therefore may be deemed to beneficially own, the shares of common stock held by these entities. |
(5) | As a Partner of J.W. Childs Associates, L.P., which manages J.W. Childs Equity Partners II, L.P., and a member of JWC-InSight Co-invest LLC, Mr. Segal may be deemed to beneficially own the 4,011,758 shares of our common stock owned by J.W. Childs Equity Partners II, L.P. and the 338,532 shares of our common stock held directly by JWC-InSight Co-invest LLC. Mr. Segal disclaims beneficial ownership of such shares. |
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(6) | As a Partner of J.W. Childs Associates, L.P., which manages J.W. Childs Equity Partners II, L.P. and a member of JWC-InSight Co-invest LLC, Mr. Yun may be deemed to beneficially own the 4,011,758 shares of our common stock owned by J.W. Childs Equity Partners II, L.P., and the 338,532 shares of our common stock held directly by JWC-InSight Co-invest LLC. Mr. Yun disclaims beneficial ownership of such shares. |
(7) | As an Operating Partner of J.W. Childs Associates, L.P., which manages J.W. Childs Equity Partners II, L.P. and a member of JWC-InSight Co-invest LLC, Mr. Cannizzaro may be deemed to beneficially own the 4,011,758 shares of our common stock owned by J.W. Childs Equity Partners II, L.P. and the 338,532 shares of our common stock held directly by JWC-InSight Co-invest LLC. Mr. Cannizzaro disclaims beneficial ownership of such shares. Includes options to purchase 40,000 shares of our common stock at an exercise price of $19.82 per share, which are fully vested and immediately exercisable. |
(8) | As a Vice President at J.W. Childs Associates, L.P., which manages J.W. Childs Equity Partners II, L.P. and a member of JWC-InSight Co-invest LLC, Mr. Tricolli may be deemed to beneficially own the 4,011,758 shares of our common stock owned by J.W. Childs Equity Partners II, L.P. and the 338,532 shares of our common stock held directly by JWC-InSight Co-invest LLC. Mr. Tricolli disclaims beneficial ownership of such shares. |
(9) | As a Managing Director of The Halifax Group, L.L.C., which manages Halifax Capital Partners, L.P., Mr. Dupree may be deemed to beneficially own the 1,107,020 shares of our common stock owned by Halifax Capital Partners, L.P. and its affiliates. Mr. Dupree disclaims beneficial ownership of such shares. |
(10) | As a Managing Director of The Halifax Group, L.L.C., which manages Halifax Capital Partners, L.P., Mr. Doyle may be deemed to beneficially own the 1,111,112 shares of our common stock owned by Halifax Capital Partners, L.P. and its affiliates. Mr. Doyle disclaims beneficial ownership of such shares. |
(11) | Includes an option to purchase 52,500 shares of our common stock at an exercise price of $8.37 per share which option was granted upon the consummation of the Acquisition and is fully vested and immediately exercisable. |
(12) | Effective August 9, 2004, Mr. Plochocki was no longer employed by us. See “Certain Relationships and Related Transactions — Severance Arrangement.” |
(13) | Does not include an option to purchase 248,236 shares of our common stock at an exercise price of $19.82 per share, which is not currently exercisable. |
(14) | Includes (i) an option to purchase 46,990 shares of our common stock at an exercise price of $8.37 per share which option was granted upon the consummation of the Acquisition and is fully vested and immediately exercisable and (ii) an option to purchase 17,500 shares of our common stock at an exercise price of $18.00 per share. Does not include an option to purchase 52,500 shares of our common stock at an exercise price of $18.00 per share, which is not currently exercisable. |
(15) | Does not include an option to purchase 40,000 shares of our common stock at an exercise price of $19.82 per share, which is not currently exercisable. |
(16) | Includes an option to purchase 7,500 shares of our common stock at an exercise price of $18.00 per share. Does not include (i) an option to purchase 22,500 shares of our common stock at an exercise price of $18.00 per share and (ii) an option to purchase 10,000 shares of our common stock at an exercise price of $19.82 per share, which are not currently exercisable. |
(17) | Includes an option to purchase 7,500 shares of our common stock at an exercise price of $18.00 per share. Does not include (i) an option to purchase 22,500 shares of our common stock at an exercise price of $18.00 per share and (ii) an option to purchase 30,000 shares of our common stock at an exercise price of $19.82 per share, which are not currently exercisable. |
(18) | Mr. Plochocki is not included in the group because he was not an executive officer as of October 31, 2005. |
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Number of Shares | ||||||||||||
Remaining Available for | ||||||||||||
Future Issuance Under | ||||||||||||
Number of Shares to be | Weighted Average | Equity Compensation | ||||||||||
Issued Upon Exercise of | Exercise Price of | Plans (Excluding Shares | ||||||||||
Plan Category | Outstanding Options | Outstanding Options | Reflected in Column (a)) | |||||||||
(a) | (b) | (c) | ||||||||||
Equity compensation plans approved by stockholders | 616,990 | $ | 16.74 | 128,950 |
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• | are general senior secured obligations of the Company; | |
• | are secured by security interests in the Collateral on a first priority basis; | |
• | rank equally in right of payment with all existing and future Pari Passu Indebtedness of the Company; and | |
• | will rank senior in right of payment to all existing and future Subordinated Indebtedness of the Company. |
• | is a senior secured obligation of the Guarantor; | |
• | is secured, on a first priority basis, by security interests in the Collateral owned by the Guarantor; | |
• | is senior in right of payment to all existing and future Subordinated Indebtedness of the Guarantor; and | |
• | ranks equally in right of payment with all existing and future Pari Passu Indebtedness of the Guarantor. |
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Overview |
Excluded Assets |
1. any interest in real property; | |
2. assets securing Capitalized Lease Obligations or Indebtedness under purchase money mortgages incurred pursuant to clause (8) of the third paragraph under the caption, “— Certain Covenants — Incurrence of Indebtedness and Issuance of Disqualified Stock,” provided that such assets that are released from such security in connection with the incurrence of Indebtedness pursuant to clause (16) of the third paragraph under the caption, “— Certain Covenants — Incurrence of Indebtedness and Issuance of Disqualified Stocks” shall not be Excluded Assets; | |
3. Excluded Contracts; | |
4. any Voting Stock that is issued by a Foreign Subsidiary (that is a corporation for United States federal income tax purposes) and owned by the Company or any Guarantor, if and to the extent that the inclusion of such Voting Stock in the Collateral would cause the Collateral pledged by the Company or such Guarantor, as the case may be, to include in the aggregate more than 65% of the total combined voting power of all classes of Voting Stock of such Foreign Subsidiary; | |
5. any Capital Stock owned by the Company or a Guarantor and issued by an entity that is not a Wholly Owned Subsidiary of the Company or a Guarantor to the extent (and only with respect to |
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such portion of such Capital Stock that would be prohibited as referred to below) that any joint venture agreement, between or among the Company and/or any Guarantor and one or more third parties with respect to a Permitted Joint Venture, by the express terms of a valid and enforceable restriction in favor of such third parties prohibits, or requires any consent for, the granting of a security interest in such Capital Stock by the Company or such Guarantor; | |
6. Receivables and Related Assets; | |
7. any Capital Stock and other securities of the Company, any of its Subsidiaries or any of the Parent’s subsidiaries to the extent that the pledge of such Capital Stock or other securities to secure the Notes or the Guarantees would cause the Company, such Subsidiary or such subsidiary of the Parent, as the case may be, to be required to file separate financial statements with the Commission pursuant to Rule 3-16 of Regulation S-X (as in effect from time to time); and | |
8. proceeds and products from any and all of the foregoing excluded collateral described in clauses (1) through (7), unless such proceeds or products would otherwise constitute Collateral securing the Notes. |
After-Acquired Property |
Permitted Liens |
Foreclosure |
1. first, to the payment of advances made and liabilities incurred by the Collateral Agent in order to protect the Liens granted by the Security Documents or the Collateral, with interest thereon at the rate specified in the Security Documents, and the payment of all reasonable out-of-pocket costs and expenses incurred by the Collateral Agent or the Trustee in connection with the preservation, collection, foreclosure or enforcement of the Liens granted by the Security Documents or any interest, right, power or remedy of the Collateral Agent or in connection with the collection or enforcement of any of the Notes or the Security Documents in any insolvency proceeding, including all reasonable out-of-pocket fees and disbursements of attorneys, accountants, consultants, appraisers and other |
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professionals engaged by the Collateral Agent or the Trustee and reasonable compensation of the Collateral Agent or the Trustee for services in connection therewith; | |
2. second, to the payment of accrued and unpaid interest on the Notes; | |
3. third, to the payment of any due and unpaid premium, if any, in respect of the prepayment or payment of the Notes; | |
4. fourth, to the payment of any due and unpaid principal of the Notes; | |
5. fifth, to any remaining unpaid amounts of the Note Obligations; and | |
6. sixth, to any other persons as their interests may appear or as instructed by a court of competent jurisdiction. |
Possession and Use of the Collateral |
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Release of Collateral |
1. in whole, as to all property subject to such Liens which has been taken by eminent domain, condemnation or other similar circumstances; | |
2. in whole, as to all property subject to such Liens, upon: |
(a) payment in full of the principal of, accrued and unpaid interest and premium on the Notes; |
or |
(b) defeasance of the Notes or discharge of the Indenture as set forth under the caption, “— Legal Defeasance and Covenant Defeasance;” or |
3. in part, as to any property that (a) is sold, transferred or otherwise disposed of by the Parent, the Company or any of their Subsidiaries in a transaction not prohibited by the Indenture, at the time of such sale, transfer or disposition, to the extent of the interest sold, transferred or disposed of or (b) is owned or at any time acquired by a Guarantor that has been released from its Guarantee, concurrently with the release of such Guarantee. |
Permitted Ordinary Course Activities with Respect to Collateral |
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Year | Redemption Price | |||
2006 | 103.00 | % | ||
2007 | 101.50 | % | ||
2008 and thereafter | 100.00 | % |
Change of Control |
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1. the purchase price and the purchase date, which will be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed or such later date as is necessary to comply with the requirements under the Exchange Act; | |
2. that any Note not tendered will continue to accrue interest; | |
3. that, unless the Company defaults in the payment of the purchase price, any Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control purchase date; and | |
4. certain other procedures that a Holder must follow to accept a Change of Control Offer or to withdraw such acceptance. |
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Asset Sales |
1. the consideration received by the Company or such Restricted Subsidiary for such Asset Sale is not less than the fair market value of the assets sold as evidenced by a resolution of the board of directors of such entity set forth in an officers’ certificate delivered to the Trustee; | |
2. the consideration received by the Company or the relevant Restricted Subsidiary in respect of such Asset Sale consists of at least 75% cash or cash equivalents. For purposes of this provision, cash and cash equivalents includes: |
(a) if such Asset Sale does not involve Collateral, any liabilities (as reflected in the Company’s consolidated balance sheet) of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Guarantee) that are assumed by any transferee of any such assets or other property in such Asset Sale, and where the Company or the relevant Restricted Subsidiary is released from any further liability in connection therewith with respect to such liabilities; | |
(b) any securities, notes or other similar obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted within 180 days of the related Asset Sale by the Company or such Restricted Subsidiary into cash or cash equivalents (to the extent of the net cash proceeds or the cash equivalents (net of related costs) received upon such conversion); | |
(c) any Designated Noncash Consideration received by the Company or any such Restricted Subsidiary in the Asset Sale having an aggregate fair market value, as determined by |
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the Board of the Company, taken together with all other Designated Noncash Consideration received pursuant to this clause that is at that time outstanding, not to exceed the greater of: |
(A) $10 million; and | |
(B) 15% of Consolidated Tangible Assets at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each item of such Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); and |
3. if such Asset Sale involves the transfer of Collateral, |
(a) all consideration received in such Asset Sale shall consist of assets that are not Excluded Assets; and | |
(b) all consideration (including cash and cash equivalents) received in such Asset Sale shall be expressly made subject to a first priority perfected Lien (subject to Permitted Liens) in favor of the Collateral Agent. |
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Restricted Payments |
(a) declare or pay any dividend on, or make any distribution to holders of, any shares of the Capital Stock of the Company or any Restricted Subsidiary, other than (i) dividends or distributions payable solely in Qualified Equity Interests or (ii) dividends or distributions by a Restricted Subsidiary payable to the Company or a Wholly Owned Restricted Subsidiary or to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis; | |
(b) purchase, redeem or otherwise acquire or retire for value, directly or indirectly, any shares of Capital Stock, or any options, warrants or other rights to acquire such shares of Capital Stock, of the Company, any direct or indirect parent of the Company or any Subsidiary of the Company (other than a Wholly Owned Restricted Subsidiary); | |
(c) make any principal payment on, or repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled principal payment, sinking fund payment or maturity, any Subordinated Indebtedness; and | |
(d) make any Investment (other than a Permitted Investment) in any Person (such payments or other actions described in (but not excluded from) clauses (a) through (d) being referred to as “Restricted Payments”), |
(i) no Default or Event of Default has occurred and is continuing, | |
(ii) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described under the caption “— Incurrence of Indebtedness and Issuance of Disqualified Stock,” and | |
(iii) the aggregate amount of all Restricted Payments made after the Reference Date does not exceed the sum of: |
(A) 50% of the aggregate Consolidated Net Income of the Company during the period (taken as one accounting period) from the first day of the Company’s first fiscal quarter commencing after October 30, 2001 to the last day of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such proposed Restricted Payment (or, if such aggregate cumulative Consolidated Net Income is a loss, 100% of such amount); plus | |
(B) 100% of the aggregate net cash proceeds received by the Company after the Reference Date as a capital contribution or from the issuance or sale (other than to a Subsidiary) of either (1) Qualified Equity Interests of the Company or (2) debt securities or Disqualified Stock that have been converted into or exchanged for Qualified Stock of the Company, together with the aggregate net cash proceeds received by the Company at the time of such conversion or exchange. |
(a) the payment of any dividend within 60 days after the date of declaration thereof, if at the declaration date such payment would not have been prohibited by the foregoing provisions; |
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(b) the repurchase, redemption or other acquisition or retirement for value of any shares of Capital Stock of the Company, in exchange for, or out of the net cash proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary) of, Qualified Equity Interests of the Company or of the Parent, the proceeds of which are contributed to the Company as a capital contribution on a substantially concurrent basis; | |
(c) the purchase, redemption, defeasance or other acquisition or retirement for value of any Subordinated Indebtedness in exchange for, or out of the net cash proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary) of, shares of Qualified Equity Interests of the Company or of the Parent, the proceeds of which are contributed to the Company as a capital contribution on a substantially concurrent basis; | |
(d) the purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Indebtedness in exchange for, or out of the net cash proceeds of a substantially concurrent issuance or sale (other than to a Subsidiary) of, Subordinated Indebtedness, so long as the Company or a Restricted Subsidiary would be permitted to refinance such original Subordinated Indebtedness with such new Subordinated Indebtedness pursuant to clause (4) of the definition of Permitted Indebtedness set forth in the covenant entitled “Incurrence of Indebtedness and Issuance of Disqualified Stock;” | |
(e) the repurchase of any Subordinated Indebtedness at a purchase price not greater than 101% of the principal amount of such Subordinated Indebtedness in the event of a Change of Control in accordance with provisions similar to the “Change of Control” covenant; provided that, prior to or simultaneously with such repurchase, the Company has made the Change of Control Offer as provided in such covenant with respect to the Notes and has repurchased all Notes validly tendered for payment in connection with such Change of Control Offer; | |
(f) within 90 days after the completion of an Excess Proceeds Offer pursuant to the covenant described under the caption “— Repurchase at the Option of Holders — Asset Sales” (including the purchase of all Notes tendered), any purchase or redemption of Indebtedness of the Company that is subordinated in right of payment to the Notes and that is required to be repurchased or redeemed pursuant to the terms thereof as a result of the related Asset Sale, at a purchase price not greater than 100% of the outstanding principal amount thereof (plus accrued and unpaid interest); | |
(g) the purchase, redemption, acquisition, cancellation or other retirement for value of shares of Capital Stock of the Company, options on any such shares or related stock appreciation rights or similar securities, or any dividend, distribution or advance to the Parent for the purchase, redemption, acquisition, cancellation or other retirement for value of shares of Capital Stock of the Parent, options on any such shares or related stock appreciation rights or similar securities, in each case held by officers, directors or employees or former officers, directors or employees (or their estates or beneficiaries under their estates) of the Company, the Parent or any Subsidiary of the Company, as applicable, or by any employee benefit plan of the Company, the Parent or any Subsidiary of the Company, as applicable, upon death, disability, retirement or termination of employment or pursuant to the terms of any employee benefit plan or any other agreement under which such shares of stock or related rights were issued; provided that the aggregate amount of cash applied by the Company for such purchase, redemption, acquisition, cancellation or other retirement of such shares of Capital Stock of the Company or the Parent after the Reference Date does not exceed $7.5 million in the aggregate (excluding for purposes of calculating such amount the aggregate amount received by any Person in connection with such purchase, redemption, acquisition, cancellation or other retirement of such shares that is concurrently used to repay loans made to such Person by the Company pursuant to clause (f) of the definition of “Permitted Investment”); | |
(h) the payment of dividends or other distributions or the making of loans or advances to the Parent in amounts required for the Parent to pay franchise taxes and other fees required to maintain its existence and provide for all other customary operating costs of the Parent to the extent attributable to the ownership and operation of the Company and its Restricted Subsidiaries, including, |
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without limitation, in respect of director fees and expenses, administrative, legal and accounting services provided by third parties and other customary costs and expenses including all costs and expenses with respect to filings with the Commission; | |
(i) the payment of dividends or other distributions by the Company to the Parent in amounts required to pay the tax obligations of the Parent attributable to the Company and its Subsidiaries, determined as if the Company and its Subsidiaries had filed a separate consolidated, combined or unitary return for the relevant taxing jurisdiction; provided that (x) the amount of dividends paid pursuant to this clause (i) to enable the Parent to pay Federal and state income taxes (and franchise taxes based on income) at any time shall not exceed the amount of such Federal and state income taxes (and franchise taxes based on income) actually owing by the Parent at such time to the respective tax authorities for the respective period and (y) any refunds received by the Parent attributable to the Company or any of its Subsidiaries shall promptly be returned by the Parent to the Company through a contribution or purchase of common stock (other than Disqualified Stock) of the Company; | |
(j) the payment of dividends or other distributions or the making of loans or advances to the Parent in amounts required for the Parent to pay to the Equity Sponsors an annual amount not to exceed $500,000 for payment of management consulting or financial advisory services provided to the Company or any of the Subsidiaries; | |
(k) other Restricted Payments not to exceed $10 million at any one time outstanding; | |
(l) repurchase or repurchases of Existing Notes; provided that (1) at the time of such repurchase or repurchases, no amount is outstanding under the Revolving Credit Agreement or any Indebtedness incurred to refinance or replace the Revolving Credit Agreement, (2) the aggregate amount of cash (or fair market value of any other assets) applied to such repurchase or repurchases under this clause (l) does not exceed $25 million and (3) the amount of cash and cash equivalents held by the Company and the Restricted Subsidiaries immediately after giving effect to such repurchase or repurchases shall not be less than $29 million; and | |
(m) repurchase or repurchases of Existing Notes; provided that (1) such repurchase or repurchases occur on the Issue Date or within two Business Days from the Issue Date and (2) the aggregate amount of cash (or fair market value of any other assets) applied to such repurchase or repurchases under this clause (m) does not exceed $50 million. |
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Incurrence of Indebtedness and Issuance of Disqualified Stock |
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(1) Indebtedness of the Company or any Subsidiary Guarantor under the Credit Agreement (and the incurrence by any Subsidiary Guarantor of guarantees thereof) in an aggregate principal amount at any one time outstanding not to exceed $125 million, less (A) any amounts applied to the permanent reduction of such credit facilities pursuant to the provisions of the covenant described under the caption “— Repurchase at the Option of Holders — Asset Sales” and (B) up to $50 million of cash (or the fair market value of any other assets) to the extent applied to repurchase Existing Notes on the Issue Date or within two Business Days from the Issue Date. | |
(2) Indebtedness represented by the Notes (other than the Additional Notes) and the related Guarantees; | |
(3) Existing Indebtedness; | |
(4) the incurrence by the Company of Permitted Refinancing Indebtedness in exchange for, or the net cash proceeds of which are used to refund, refinance or replace, any Indebtedness that is permitted to be incurred under clause (2) or (3) above; | |
(5) Indebtedness owed by the Company to any Restricted Subsidiary or owed by any Restricted Subsidiary to the Company or a Restricted Subsidiary (provided that such Indebtedness is held by the Company or such Restricted Subsidiary);provided, however,that: |
(a) any Indebtedness of the Company or any Subsidiary Guarantor owing to any such Restricted Subsidiary is unsecured and subordinated in right of payment from and after such time as the Notes shall become due and payable (whether at Stated Maturity, acceleration, or otherwise) to the payment and performance of the Company’s obligations under the Notes or the Subsidiary Guarantor’s obligations under its Guarantee, as the case may be; and | |
(b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary thereof, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (5); |
(6) Indebtedness of the Company or any Restricted Subsidiary under Hedging Obligations incurred in the ordinary course of business; | |
(7) Indebtedness of the Company or any Restricted Subsidiary consisting of guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock; | |
(8) either (A) Capitalized Lease Obligations of the Company or any Restricted Subsidiary or (B) Indebtedness under purchase money mortgages or secured by purchase money security interests so long as (x) such Indebtedness is not secured by any property or assets of the Company or any Restricted Subsidiary other than the property and assets so acquired and (y) such Indebtedness is created within 90 days of the acquisition of the related property;providedthat the aggregate amount |
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of Indebtedness under clauses (A) and (B) does not exceed 15% of Consolidated Tangible Assets less the amount of any Indebtedness incurred under clause (16) below at any one time outstanding; | |
(9) Guarantees by any Restricted Subsidiary made in accordance with the provisions of the covenant described under the caption “— Guarantees of Indebtedness by Restricted Subsidiaries;” | |
(10) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business;provided, however,that such Indebtedness is extinguished within two business days of incurrence; | |
(11) Indebtedness of the Company or any of its Restricted Subsidiaries represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers’ compensation claims, payment obligations in connection with self-insurance or similar requirements in the ordinary course of business; | |
(12) the incurrence of Non-Recourse Indebtedness by Permitted Joint Ventures that are Restricted Subsidiaries; | |
(13) Indebtedness incurred by a Receivables Subsidiary pursuant to a Receivables Program; provided that, after giving effect to any such incurrence of Indebtedness, the aggregate principal amount of all Indebtedness incurred under this clause (13) and then outstanding does not exceed $30 million; | |
(14) Indebtedness of the Company, any Restricted Subsidiary or any Permitted Joint Venture not permitted by any other clause of this definition, in an aggregate principal amount not to exceed $30 million at any one time outstanding; | |
(15) Indebtedness represented by Attributable Debt related to a Sale and Leaseback transaction involving tractors existing on the Issue Date; provided that (i) the aggregate amount of such Indebtedness does not exceed $7 million and (ii) such Indebtedness is incurred within 12 months from the Issue Date; and | |
(16) the incurrence of Indebtedness represented by Additional Notes and the related Guarantees, the net cash proceeds of which are used to satisfy, extinguish and retire the Company and/or any of the Restricted Subsidiaries’ obligations under any Indebtedness incurred under clause (8) above; provided that (A) any property or assets of the Company or any Restricted Subsidiary securing such Indebtedness, the obligations of which are being so satisfied, extinguished and retired, are fully released from such security and (B) such property or assets are expressly made subject to a first priority perfected Lien in favor of the Collateral Agent. |
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Liens |
Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries |
(1) pay dividends, in cash or otherwise, or make any other distributions on or in respect of its Capital Stock; | |
(2) pay any Indebtedness owed to the Company or any other Restricted Subsidiary; | |
(3) make loans or advances to the Company or any other Restricted Subsidiary; or | |
(4) transfer any of its properties or assets to the Company or any other Restricted Subsidiary. |
(1) any agreement (including the Revolving Credit Agreement) in effect on the Issue Date; | |
(2) customary non-assignment provisions of any lease, license or other contract entered into in the ordinary course of business by the Company or any Restricted Subsidiary; | |
(3) the refinancing or successive refinancing of Indebtedness incurred under the agreements in effect on the Issue Date (including the Revolving Credit Agreement), so long as such encumbrances or restrictions are no more restrictive, taken as a whole, than those contained in such original agreement; | |
(4) any agreement or other instrument of a Person acquired by the Company or any Restricted Subsidiary in existence at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; | |
(5) purchase money obligations for acquired property permitted under the covenant entitled “— Incurrence of Indebtedness and Issuance of Disqualified Stock” that impose restrictions of the nature described in clause (4) of the preceding paragraph on the property so acquired; | |
(6) any agreement for the sale of a Restricted Subsidiary or an asset that restricts distributions by that Restricted Subsidiary or transfers of such asset pending its sale; | |
(7) secured Indebtedness otherwise permitted to be incurred pursuant to the provisions of the covenant described above under the caption “— Liens” that limits the right of the debtor to dispose of the assets securing such Indebtedness; | |
(8) restrictions on cash or other deposits or net worth imposed by leases entered into in the ordinary course of business; |
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(9) Non-Recourse Indebtedness of any Permitted Joint Venture permitted to be incurred under the Indenture; | |
(10) applicable law or regulation; | |
(11) a Receivables Program with respect to a Receivables Subsidiary; and | |
(12) customary provisions in joint venture, limited liability company operating, partnership, shareholder and other similar agreements entered into in the ordinary course of business reasonably consistent with past practice by the Company or any Restricted Subsidiary. |
Merger, Consolidation or Sale of Assets |
(a) either (i) the Company or the Parent, as the case may be, is the surviving corporation or (ii) the entity or the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made (the “Surviving Entity”) is a corporation organized or existing under the laws of the United States, any state thereof or the District of Columbia and assumes all the obligations of the Company or the Parent, as the case may be, under the Notes, the Indenture, the Security Documents and the Registration Rights Agreement pursuant to agreements in form and substance reasonably satisfactory to the Trustee; | |
(b) immediately after giving effect to such transaction and treating any obligation of the Company in connection with or as a result of such transaction as having been incurred as of the time of such transaction, no Default or Event of Default has occurred and is continuing; | |
(c) if such transaction involves the Company, the Company (or the Surviving Entity if the Company is not the continuing obligor under the Indenture) could, at the time of such transaction and after givingpro forma effect thereto as if such transaction had occurred at the beginning of the applicable four quarter period, incur at least $1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to the first paragraph of “— Incurrence of Indebtedness and Issuance of Disqualified Stock;” | |
(d) each Guarantor, unless it is the other party to the transaction described above, has by supplemental indenture confirmed that its Guarantee applies to the Surviving Entity’s obligations under the Indenture and the Notes; | |
(e) if any of the property or assets of the Company or any of its Restricted Subsidiaries would thereupon become subject to any Lien, the provisions of the covenant described above under the caption “— Liens” are complied with; and | |
(f) the Company or the Parent, as the case may be, delivers, or causes to be delivered, to the Trustee, in form and substance reasonably satisfactory to the Trustee, an officers’ certificate and an opinion of counsel, each stating that such transaction complies with the requirements of the Indenture. |
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Transactions with Affiliates |
(A) transactions among the Company and/or its Restricted Subsidiaries; | |
(B) the Company from paying reasonable and customary regular compensation, indemnification, reimbursement and fees to officers of the Company or any Restricted Subsidiary and to directors of the Company or any Restricted Subsidiary who are not employees of the Company or any Restricted Subsidiary; | |
(C) transactions permitted by the provisions of the covenant described under the caption “Certain Covenants — Restricted Payments;” | |
(D) advances to employees for moving, entertainment and travel expenses and similar expenditures in the ordinary course of business and consistent with past practice; | |
(E) any Receivables Program of the Company or a Restricted Subsidiary; | |
(F) the agreements described herein under the caption “Certain Relationships and Related Transactions” and certain other agreements listed on a schedule to the Indenture, in each case as in effect as of the Issue Date or any amendment thereto (so long as the amended agreement is not more |
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disadvantageous to the Holders in any material respect than such agreement immediately prior to such amendment) or any transaction contemplated thereby; and | |
(G) issuances of Equity Interests (other than Disqualified Stock) of the Parent or the Company to Affiliates. |
Limitation on Issuances and Sales of Capital Stock of Restricted Subsidiaries |
Payments for Consent |
Guarantees of Indebtedness by Restricted Subsidiaries |
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Issuances of Guarantees by New Restricted Subsidiaries |
Unrestricted Subsidiaries |
Sale and Leaseback Transactions |
(1) Company or such Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such Sale and Leaseback Transaction pursuant to the covenant described under the caption “— Incurrence of Indebtedness and Issuance of Disqualified Stock” and (b) incurred a Lien to secure such Indebtedness pursuant to the covenant described under the caption “— Liens;” |
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(2) the gross cash proceeds of that Sale and Leaseback Transaction are at least equal to the fair market value of the property that is the subject of that Sale and Leaseback Transaction; and | |
(3) the transfer of assets in that Sale and Leaseback Transaction is permitted by, and the Company applies the proceeds of such transaction in compliance with, the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales.” |
Reports |
(a) default in the payment of any interest on any Note when it becomes due and payable, and continuance of such default for a period of 30 days; | |
(b) default in the payment of the principal of (or premium, if any, on) any Note when due; | |
(c) failure to perform or comply with the Indenture provisions described under the captions “— Repurchase at the Option of Holders — Change of Control,” “— Repurchase at the Option of Holders — Asset Sales,” “— Certain Covenants — Restricted Payments,” “Incurrence of Indebtedness and Issuance of Disqualified Stock” or “— Merger, Consolidation or Sale of Assets;” | |
(d) default in the performance, or breach, of any covenant or agreement of the Company or any Guarantor contained in the Indenture or in any Guarantee (other than a default in the performance, or breach, of a covenant or agreement that is specifically dealt with elsewhere herein), and continuance of such default or breach for a period of 60 days after written notice has been given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Notes then outstanding; | |
(e) (i) an event of default has occurred under any mortgage, bond, indenture, loan agreement or other document evidencing an issue of Indebtedness of the Company, the Parent or any Restricted Subsidiary, which issue individually or in the aggregate has an aggregate outstanding principal amount of not less than $10 million, and such default has resulted in such Indebtedness becoming, whether by declaration or otherwise, due and payable prior to the date on which it would otherwise become due and payable or (ii) a default in any payment when due at final maturity of any such Indebtedness; | |
(f) failure by the Company, the Parent or any of its Restricted Subsidiaries to pay one or more final judgments the uninsured portion of which exceeds in the aggregate $10 million, which judgment or judgments are not paid, discharged or stayed for a period of 60 days; |
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(g) any Guarantee ceases to be in full force and effect or is declared null and void or any such Guarantor denies that it has any further liability under any Guarantee, or gives notice to such effect (other than by reason of the termination of the Indenture or the release of any such Guarantee in accordance with the Indenture); | |
(h) the occurrence of certain events of bankruptcy, insolvency or reorganization with respect to the Company, the Parent or any Significant Subsidiary; or | |
(i) default by the Company or any Restricted Subsidiary in the performance of the Security Documents which adversely affects the enforceability, validity, perfection or priority of such Liens, the repudiation or disaffirmation by the Company or any Restricted Subsidiary of its material obligations under the Security Documents or the determination in a judicial proceeding that the Security Documents are unenforceable or invalid against the Company or any Restricted Subsidiary party thereto for any reason with respect to the Collateral (which default, repudiation, disaffirmation or determination is not rescinded, stayed, or waived by the Persons having such authority pursuant to the Security Documents or otherwise cured within 60 days after the Company receives written notice thereof specifying such occurrence from the Trustee or the Holders of at least 25% of the outstanding principal amount of the Notes and demanding that such default be remedied). |
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(a) change the Stated Maturity of the principal of, or any installment of interest on, any Note, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the coin or currency in which any Note or any premium or the interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment after the Stated Maturity thereof (or, in the case of redemption, on or after the redemption date); | |
(b) amend, change or modify the obligation of the Company to make and consummate an Excess Proceeds Offer with respect to any Asset Sale in accordance with the covenant described under the covenant entitled “Repurchase at the Option of Holders — Asset Sales” or the obligation of the Company to make and consummate a Change of Control Offer in the event of a Change of Control in accordance with the covenant entitled “Repurchase at the Option of Holders — Change of Control,” including, in each case, amending, changing or modifying any definition relating thereto; | |
(c) reduce the percentage in principal amount of outstanding Notes, the consent of whose Holders is required for any waiver of compliance with certain provisions of, or certain defaults and their consequences provided for under, the Indenture; | |
(d) waive a default in the payment of principal of, or premium, if any, or interest on the Notes or reduce the percentage or aggregate principal amount of outstanding Notes the consent of whose Holders is necessary for waiver of compliance with certain provisions of the Indenture or for waiver of certain defaults; | |
(e) modify the ranking or priority of the Notes or the Guarantee of any Guarantor; or | |
(f) release any Guarantor from any of its obligations under its Guarantee or the Indenture other than in accordance with the terms of the Indenture. |
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Depositary Procedures |
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A Global Note is exchangeable for definitive Notes in registered certificated form (“Certificated Notes”) if: | |
(1) DTC (a) notifies the Company that it is unwilling or unable to continue as depositary for the Global Notes and the Company fails to appoint a successor depositary within 90 days or (b) has ceased to be a clearing agency registered under the Exchange Act; | |
(2) the Company, at its option, notifies the Trustee in writing that it elects to cause the issuance of the Certificated Notes; or | |
(3) there shall have occurred and be continuing a Default or Event of Default with respect to the Notes. |
Exchange of Certificated Notes for Global Notes |
Same-Day Settlement and Payment |
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(1) in respect of Asset Sales involving Collateral, Indebtedness secured on a first priority basis by the Collateral; or | |
(2) in respect of Asset Sales not involving Collateral, Pari Passu Indebtedness. |
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(a) the consummation of any transaction (including, without limitation, any merger or consolidation) (a) prior to a Public Equity Offering by the Company or the Parent, the result of which is that the Principals and their Related Parties become the “beneficial owner” (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act) of less than 50% of the Voting Stock of the Company or the Parent, as the case may be (measured by voting power rather than the number of shares), or (b) after a Public Equity Offering of the Company or the Parent, any “person” or “group” (as such terms are used in Section 13(d) and 14(d) of the Exchange Act), other than the Principals and their Related Parties, become the beneficial owner (as defined above), directly or indirectly, of 35% or more of the Voting Stock of the Company or the Parent, as the case may be, and such person is or becomes, directly or indirectly, the beneficial owner of a greater percentage of the voting power of the Voting Stock of the Company or the Parent, as the case may be, calculated on a fully diluted basis, than the percentage beneficially owned by the Principals and their Related Parties; | |
(b) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Subsidiaries or the Parent and its Subsidiaries, in each case, taken as a whole, to any “person” (as the term is defined in Section 13(d)(3) of the Exchange Act) other than the Principals or Related Parties of the Principals; | |
(c) the first day on which a majority of the members of the Board of the Company or the Parent are not Continuing Directors; or | |
(d) the Company or the Parent is liquidated or dissolved or adopts a plan of liquidation or dissolution, other than in a transaction that complies with the provisions described under “Certain Covenants — Consolidation, Merger or Sale of Assets.” |
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(1) was a member of such Board on the Reference Date; | |
(2) was nominated for election or elected to such Board with the approval of the majority of the Continuing Directors who were members of such Board at the time of such nomination or election; or (3) was nominated by one or more of the Principals and the Related Parties. |
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(a) Investments in (i) United States dollars (including such dollars as are held as overnight bank deposits and demand deposits with banks), (ii) securities with a maturity of one year or less issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof); (iii) certificates of deposit, Euro-dollar time deposits or acceptances with a maturity |
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of one year or less of any financial institution that is a member of the Federal Reserve System having combined capital and surplus of not less than $500,000,000; (iv) any shares of money market mutual or similar funds having assets in excess of $500,000,000; (v) repurchase obligations with a term not exceeding seven days for underlying securities of the types described in clauses (ii) and (iii) above entered into with any financial institution meeting the qualifications specified in clause (iii) above; and (vi) commercial paper with a maturity of one year or less issued by a corporation that is not an Affiliate of the Company and is organized under the laws of any state of the United States or the District of Columbia and having a rating (A) from Moody’s Investors Service, Inc. of at least P-1 or (B) from Standard & Poor’s Ratings Group of at least A-1; | |
(b) Investments by the Company or any Restricted Subsidiary in another Person, if as a result of such Investment (i) such other Person becomes a Restricted Subsidiary or (ii) such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, the Company or a Restricted Subsidiary; | |
(c) Investments by the Company or a Restricted Subsidiary in the Company or a Restricted Subsidiary; | |
(d) Investments in existence on the Reference Date; | |
(e) promissory notes or other evidence of Indebtedness received as a result of Asset Sales permitted under the covenant entitled “Repurchase at the Option of Holders — Asset Sales;” | |
(f) loans or advances to officers, directors and employees of the Company or any of its Restricted Subsidiaries made (i) in the ordinary course of business in an amount not to exceed $5 million in the aggregate at any one time outstanding or (ii) in connection with the purchase by such Persons of Equity Interests of the Parent so long as the cash proceeds of such purchase received by the Parent are contemporaneously remitted by the Parent to the Company as a capital contribution; | |
(g) any Investment by the Company or any Restricted Subsidiary of the Company in Permitted Joint Ventures made after the Reference Date having an aggregate fair market value, when taken together with all other Investments made pursuant to this clause (g) that are at the time outstanding, not exceeding the greater of (i) $30 million and (ii) 10% of the Consolidated Tangible Assets of the Company as of the last day of the most recent full fiscal quarter ending immediately prior to the date of such Investment (with the fair market value of each Investment being measured at the time made and without giving effect to subsequent changes in value); | |
(h) any Investment by the Company or any Restricted Subsidiary in a trust, limited liability company, special purpose entity or other similar entity in connection with a Receivables Program; provided that (A) such Investment is made by a Receivables Subsidiary and (B) the only assets transferred to such trust, limited liability company, special purpose entity or other similar entity consists of Receivables and Related Assets of such Receivables Subsidiary; and | |
(i) other Investments that do not exceed $20 million in the aggregate at any one time outstanding. |
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(1) Liens on Receivables and Related Assets securing Indebtedness incurred under clause (1) of the covenant described under the caption “Certain Covenants — Incurrence of Indebtedness and Issuance of Disqualified Stock” in an aggregate principal amount not to exceed $125 million less (A) up to $50 million of cash (or the fair market value of any other assets) to the extent applied to repurchase Existing Notes on the Issue Date or within two Business Days from the Issue Date and (B) the aggregate principal amount of any Additional Notes issued by the Company. | |
(2) Liens in favor of the Company or any Restricted Subsidiary that is a Guarantor; | |
(3) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or any Restricted Subsidiary of the Company;provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with the Company or the Restricted Subsidiary; | |
(4) Liens on property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary of the Company, provided that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any property other than the property so acquired by the Company or the Restricted Subsidiary; | |
(5) Liens securing the Notes (other than Additional Notes) and the related Guarantees; | |
(6) Liens existing on the Issue Date; | |
(7) Liens securing Permitted Refinancing Indebtedness;provided that such Liens do not extend to any property or assets other than the property or assets that secure the Indebtedness being refinanced; | |
(8) Liens to secure Indebtedness (including Capitalized Lease Obligations) permitted by clause (8) of the third paragraph of the covenant described under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Disqualified Stock;” provided that any such Lien (i) covers only the assets acquired, constructed or improved with such Indebtedness and (ii) is created within 90 days of such acquisition, construction or improvement; | |
(9) Liens on cash or cash equivalents securing Hedging Obligations of the Company or any of its Restricted Subsidiaries (a) that are incurred for the purpose of fixing, hedging or swapping interest rate, commodity price or foreign currency exchange rate risk (or to reverse or amend any such agreements previously made for such purposes), and not for speculative purposes, or (b) securing letters of credit that support such Hedging Obligations; |
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(10) Liens incurred or deposits made in the ordinary course of business in connection with worker’s compensation, unemployment insurance or other social security obligations; | |
(11) Lien, deposits or pledges to secure the performance of bids, tenders, contracts (other than contracts for the payment of Indebtedness), leases, or other similar obligations arising in the ordinary course of business; | |
(12) Carriers’, warehousemen’s, mechanics’, landlords’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business in respect of obligations not overdue for a period in excess of 60 days or which are being contested in good faith by appropriate proceedings promptly instituted and diligently prosecuted;provided, however, that any reserve or other appropriate provision as will be required to conform with GAAP will have been made for that reserve or provision; | |
(13) survey exceptions, encumbrances, easements or reservations of, or rights of other for, rights of way, zoning or other restrictions as to the use of properties, and defects in title which, in the case of any of the foregoing, were not incurred or created to secure the payment of Indebtedness, and which in the aggregate do not materially adversely affect the value of such properties or materially impair the use for the purposes of which such properties are held by the Company or any of its Restricted Subsidiaries; | |
(14) judgment and attachment Liens not giving rise to an Event of Default and notices oflis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made; | |
(15) Liens, deposits or pledges to secure public or statutory obligations, surety, stay, appeal, indemnity, performance or other similar bonds or obligations; any encumbrance on rights of the Company or any Guarantor to pledge interest in, or grant control over, Patient Receivables to third parties pursuant to applicable statutes; Liens, deposits or pledges in lieu of such bonds or obligations, or to secure such bonds or obligations, or to secure letters of credit in lieu of or supporting the payment of such bonds or obligations; and Liens of sellers of goods to the Company and any of its Restricted Subsidiaries arising under Article 2 of the UCC in the ordinary course of business, covering only the goods sold and securing only the unpaid purchase price for such goods and related expenses; | |
(16) Liens in favor of collecting or payor banks having a right of setoff, revocation, refund or chargeback with respect to money or instruments of the Company or any Subsidiary thereof on deposit with or in possession of such bank; | |
(17) any interest or title of a lessor, licensor or sublicensor in the property subject to any lease, license or sublicense (other than any property that is the subject of a Sale Leaseback Transaction); | |
(18) Liens for taxes, assessments and governmental charges not yet delinquent or being contested in good faith and for which adequate reserves have been established to the extent required by GAAP; (19) Liens arising from precautionary UCC financing statements regarding operating leases or consignments; | |
(19) Liens or assets directly related to a Sale and Leaseback Transaction to secure related Attributable Debt; | |
(20) any interest of title of a buyer in connection with, and Liens arising from UCC financing statements relating to, a sale of Receivables and Related Assets pursuant to a Receivables Program;provided that such Liens do not extend to any assets other than Receivables and Related Assets; | |
(21) Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto; provided that such insurance policies are purchased in the ordinary course of business; | |
(22) Liens securing Additional Notes and the related Guarantees incurred pursuant to clauses (1), (14) or (16) of the covenant described under the caption “Certain Covenants — |
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Incurrence of Indebtedness and Issuance of Disqualified Stock” in an aggregate principal amount not to exceed $125 million less up to $50 million of cash (or the fair market value of any other assets) to the extent applied to repurchase Existing Notes on the Issue Date or within two Business Days from the Issue Date; and | |
(23) Liens not otherwise permitted by the Indenture so long as the aggregate outstanding principal amount of the obligations secured thereby does not exceed $3 million at any one time outstanding. |
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(1) any controlling stockholder, partner, member, 80% (or more) owned Subsidiary, or immediate family member (in the case of an individual) of any Principal; or | |
(2) any trust, corporation, partnership or other entity, the beneficiaries, stockholders, partners, owners or Persons beneficially holding an 80% or more controlling interest of which consist of any one or more Principals and/or such other Persons referred to in the immediately preceding clause. |
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• | makes any statement in this prospectus untrue in any material respect; | |
• | requires the making of any changes in this prospectus to make the statements in this prospectus not misleading; or | |
• | may impose upon us disclosure obligations that may have a material adverse effect on us, which notice we agree to deliver promptly to the broker-dealer, the broker-dealer will suspend use of this prospectus until we have notified the broker-dealer that delivery of the prospectus may resume and have furnished copies of any amendment or supplement to this prospectus to the broker-dealer. |
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Page Number | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 – F-30 | ||||
F-31 | ||||
F-32 | ||||
F-33 | ||||
F-34 | ||||
F-35 – F-46 |
F-1
Table of Contents
PRICEWATERHOUSECOOPERS LLP |
F-2
Table of Contents
2005 | 2004 | |||||||||
(Amounts in thousands, | ||||||||||
except share data) | ||||||||||
ASSETS | ||||||||||
CURRENT ASSETS: | ||||||||||
Cash and cash equivalents | $ | 20,839 | $ | 30,412 | ||||||
Trade accounts receivables, net | 46,450 | 55,010 | ||||||||
Short-term investments | 5,000 | — | ||||||||
Other current assets | 7,970 | 6,207 | ||||||||
Total current assets | 80,259 | 91,629 | ||||||||
PROPERTY AND EQUIPMENT, net | 209,461 | 242,336 | ||||||||
INVESTMENTS IN PARTNERSHIPS | 3,513 | 2,901 | ||||||||
OTHER ASSETS | 16,301 | 19,302 | ||||||||
OTHER INTANGIBLE ASSETS, net | 36,459 | 38,518 | ||||||||
GOODWILL | 278,530 | 280,945 | ||||||||
$ | 624,523 | $ | 675,631 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
CURRENT LIABILITIES: | ||||||||||
Current portion of notes payable | $ | 2,795 | $ | 2,716 | ||||||
Current portion of capital lease obligations | 4,927 | 5,060 | ||||||||
Accounts payable and other accrued expenses | 36,469 | 35,737 | ||||||||
Total current liabilities | 44,191 | 43,513 | ||||||||
LONG-TERM LIABILITIES: | ||||||||||
Notes payable, less current portion | 485,531 | 518,245 | ||||||||
Capital lease obligations, less current portion | 8,315 | 13,802 | ||||||||
Other long-term liabilities | 3,538 | 5,130 | ||||||||
Deferred income taxes | 15,224 | — | ||||||||
Total long-term liabilities | 512,608 | 537,177 | ||||||||
COMMITMENTS AND CONTINGENCIES (Note 10) | ||||||||||
STOCKHOLDERS’ EQUITY: | ||||||||||
Common stock, $.001 par value, 10,000,000 shares authorized, 5,468,814 shares issued and outstanding at June 30, 2005 and 2004 | 5 | 5 | ||||||||
Additional paid-in capital | 87,081 | 87,081 | ||||||||
Retained (deficit) earnings | (19,362 | ) | 7,855 | |||||||
Total stockholders’ equity | 67,724 | 94,941 | ||||||||
$ | 624,523 | $ | 675,631 | |||||||
F-3
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Years Ended June 30, | ||||||||||||||
2005 | 2004 | 2003 | ||||||||||||
(Amounts in thousands) | ||||||||||||||
REVENUES: | ||||||||||||||
Contract services | $ | 136,537 | $ | 129,193 | $ | 111,921 | ||||||||
Patient services | 180,336 | 161,691 | 125,831 | |||||||||||
Total revenues | 316,873 | 290,884 | 237,752 | |||||||||||
COSTS OF OPERATIONS: | ||||||||||||||
Costs of services | 194,507 | 168,700 | 125,685 | |||||||||||
Provision for doubtful accounts | 5,723 | 4,998 | 4,154 | |||||||||||
Equipment leases | 2,326 | 990 | 860 | |||||||||||
Depreciation and amortization | 65,601 | 58,733 | 49,345 | |||||||||||
Total costs of operations | 268,157 | 233,421 | 180,044 | |||||||||||
Gross profit | 48,716 | 57,463 | 57,708 | |||||||||||
CORPORATE OPERATING EXPENSES | (18,447 | ) | (16,217 | ) | (13,750 | ) | ||||||||
(LOSS) GAIN ON SALES OF CENTERS | (170 | ) | 2,129 | — | ||||||||||
EQUITY IN EARNINGS OF UNCONSOLIDATED PARTNERSHIPS | 2,613 | 2,181 | 1,744 | |||||||||||
INTEREST EXPENSE, net | (44,860 | ) | (40,682 | ) | (37,514 | ) | ||||||||
(Loss) income before income taxes | (12,148 | ) | 4,874 | 8,188 | ||||||||||
PROVISION FOR INCOME TAXES | 15,069 | 1,950 | 3,266 | |||||||||||
Net (loss) income | $ | (27,217 | ) | $ | 2,924 | $ | 4,922 | |||||||
F-4
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Accumulated | |||||||||||||||||||||||||
Common Stock | Additional | Other | Retained | ||||||||||||||||||||||
Paid-In | Comprehensive | Earnings | |||||||||||||||||||||||
Shares | Amount | Capital | Gain (Loss) | (Deficit) | Total | ||||||||||||||||||||
(Amounts in thousands, except share data) | |||||||||||||||||||||||||
BALANCE AT JUNE 30, 2002 | 5,468,764 | $ | 5 | $ | 87,586 | $ | (224 | ) | $ | 9 | $ | 87,376 | |||||||||||||
Stock options exercised | 50 | — | 1 | — | — | 1 | |||||||||||||||||||
Repurchase of stock options | — | — | (506 | ) | — | — | (506 | ) | |||||||||||||||||
Net income | — | — | — | — | 4,922 | 4,922 | |||||||||||||||||||
Other comprehensive loss: | |||||||||||||||||||||||||
Unrealized loss attributable to change in fair value of derivative | — | — | — | (179 | ) | — | (179 | ) | |||||||||||||||||
Comprehensive income | 4,743 | ||||||||||||||||||||||||
BALANCE AT JUNE 30, 2003 | 5,468,814 | 5 | 87,081 | (403 | ) | 4,931 | 91,614 | ||||||||||||||||||
Net income | — | — | — | — | 2,924 | 2,924 | |||||||||||||||||||
Other comprehensive gain: | |||||||||||||||||||||||||
Unrealized gain attributable to change in fair value of derivative | — | — | — | 403 | — | 403 | |||||||||||||||||||
Comprehensive income | 3,327 | ||||||||||||||||||||||||
BALANCE AT JUNE 30, 2004 | 5,468,814 | 5 | 87,081 | — | 7,855 | 94,941 | |||||||||||||||||||
Net loss | — | — | — | — | (27,217 | ) | (27,217 | ) | |||||||||||||||||
BALANCE AT JUNE 30, 2005 | 5,468,814 | $ | 5 | $ | 87,081 | $ | — | $ | (19,362 | ) | $ | 67,724 | |||||||||||||
F-5
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Years Ended June 30, | |||||||||||||||
2005 | 2004 | 2003 | |||||||||||||
(Amounts in thousands) | |||||||||||||||
OPERATING ACTIVITIES: | |||||||||||||||
Net (loss) income | $ | (27,217 | ) | $ | 2,924 | $ | 4,922 | ||||||||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||||||
Loss (gain) on sales of centers | 170 | (2,129 | ) | — | |||||||||||
Depreciation and amortization | 65,601 | 58,733 | 49,345 | ||||||||||||
Deferred income taxes | 15,224 | — | — | ||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||
Trade accounts receivables, net | 8,096 | (8,455 | ) | (2,237 | ) | ||||||||||
Other current assets | (1,736 | ) | 3,084 | 4,907 | |||||||||||
Accounts payable and other accrued expenses | 726 | 5,963 | 4,819 | ||||||||||||
Net cash provided by operating activities | 60,864 | 60,120 | 61,756 | ||||||||||||
INVESTING ACTIVITIES: | |||||||||||||||
Acquisition of fixed-site centers and mobile facilities | — | (101,334 | ) | (46,292 | ) | ||||||||||
Proceeds from sales of centers | 2,810 | 5,413 | — | ||||||||||||
Additions to property and equipment | (30,459 | ) | (46,734 | ) | (56,967 | ) | |||||||||
Net purchases of short-term investments | (5,000 | ) | — | — | |||||||||||
Other | 71 | 405 | 554 | ||||||||||||
Net cash used in investing activities | (32,578 | ) | (142,250 | ) | (102,705 | ) | |||||||||
FINANCING ACTIVITIES: | |||||||||||||||
Proceeds from stock options and warrants exercised | — | — | 1 | ||||||||||||
Purchase of stock options | — | — | (506 | ) | |||||||||||
Principal payments of notes payable and capital lease obligations | (37,781 | ) | (8,209 | ) | (7,500 | ) | |||||||||
Proceeds from issuance of debt | — | 101,125 | 50,000 | ||||||||||||
Other | (78 | ) | 72 | 725 | |||||||||||
Net cash (used in) provided by financing activities | (37,859 | ) | 92,988 | 42,720 | |||||||||||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS: | (9,573 | ) | 10,858 | 1,771 | |||||||||||
Cash, beginning of period | 30,412 | 19,554 | 17,783 | ||||||||||||
Cash, end of period | $ | 20,839 | $ | 30,412 | $ | 19,554 | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||||||||||
Interest paid | $ | 42,461 | $ | 38,939 | $ | 36,286 | |||||||||
Income taxes paid (refund received) | 202 | 377 | (224 | ) | |||||||||||
Equipment additions under capital leases | — | — | 25,455 |
F-6
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1. | NATURE OF BUSINESS |
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
F-7
Table of Contents
Vehicles | 3 to 8 years | |
Buildings | 7 to 20 years | |
Leasehold improvements | Lesser of the useful life or term of lease | |
Computer and office equipment | 3 to 5 years | |
Diagnostic and related equipment | 5 to 8 years | |
Equipment and vehicles under capital leases | Lesser of the useful life or term of lease |
F-8
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Years Ended June 30, | ||||||||||||||
2005 | 2004 | 2003 | ||||||||||||
Net (loss) income: | As reported | $ | (27,217 | ) | $ | 2,924 | $ | 4,922 | ||||||
Expense | (245 | ) | (377 | ) | (652 | ) | ||||||||
Pro-forma | $ | (27,462 | ) | $ | 2,547 | $ | 4,270 | |||||||
Years Ended June 30, | ||||||||||||
Assumptions | 2005 | 2004 | 2003 | |||||||||
Weighted average estimated fair value per option granted | 6.80 | 6.22 | 6.39 | |||||||||
Risk-free interest rate | 4.13-4.50% | 3.58-4.18% | 4.07-4.58% | |||||||||
Volatility | 0.00% | 0.00% | 0.00% | |||||||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | |||||||||
Estimated contractual life | 10.00 years | 10.00 years | 10.00 years |
F-9
Table of Contents
F-10
Table of Contents
3. | ACQUISITIONS |
F-11
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Year Ended | ||||
June 30, | ||||
2004 | ||||
(Unaudited) | ||||
Revenues | $ | 333,864 | ||
Costs of operations | 257,665 | |||
Gross profit | 76,199 | |||
Corporate operating expenses | (32,436 | ) | ||
Gain on sale of center | 2,129 | |||
Equity in earnings of unconsolidated partnerships | 2,181 | |||
Impairment and restructuring charges | (1,142 | ) | ||
Interest expense, net | (43,429 | ) | ||
Income before income taxes | 3,502 | |||
Provision for income taxes | 1,400 | |||
Net income | $ | 2,102 | ||
4. | TRADE ACCOUNTS RECEIVABLES |
June 30, | ||||||||
2005 | 2004 | |||||||
Trade accounts receivables | $ | 96,646 | $ | 115,645 | ||||
Less: Allowances for contractual adjustments | 29,412 | 37,209 | ||||||
Allowances for professional fees | 11,897 | 15,329 | ||||||
Allowances for doubtful accounts | 8,887 | 8,097 | ||||||
Trade accounts receivables, net | $ | 46,450 | $ | 55,010 | ||||
F-12
Table of Contents
5. | OTHER CURRENT ASSETS |
June 30, | ||||||||
2005 | 2004 | |||||||
Prepaid expenses | $ | 6,965 | $ | 5,249 | ||||
Amounts due from our unconsolidated partnerships | 1,005 | 958 | ||||||
$ | 7,970 | $ | 6,207 | |||||
6. | PROPERTY AND EQUIPMENT |
June 30, | ||||||||
2005 | 2004 | |||||||
Vehicles | $ | 5,701 | $ | 4,570 | ||||
Land, building and leasehold improvements | 29,335 | 27,201 | ||||||
Computer and office equipment | 44,996 | 44,373 | ||||||
Diagnostic and related equipment | 231,351 | 207,856 | ||||||
Equipment and vehicles under capital leases | 74,862 | 77,460 | ||||||
386,245 | 361,460 | |||||||
Less: Accumulated depreciation and amortization | 176,784 | 119,124 | ||||||
Property and equipment, net | $ | 209,461 | $ | 242,336 | ||||
7. | GOODWILL AND OTHER INTANGIBLE ASSETS |
Mobile | Fixed | Consolidated | |||||||||||
Goodwill, June 30, 2004 | $ | 106,064 | $ | 174,881 | $ | 280,945 | |||||||
Acquired in acquisitions | — | 747 | 747 | ||||||||||
Sales of centers | — | (1,362 | ) | (1,362 | ) | ||||||||
Adjustments to goodwill | (1,800 | ) | — | (1,800 | ) | ||||||||
Goodwill, June 30, 2005 | $ | 104,264 | $ | 174,266 | $ | 278,530 | |||||||
F-13
Table of Contents
June 30, 2005 | June 30, 2004 | ||||||||||||||||
Gross | Gross | ||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | ||||||||||||||
Value | Amortization | Value | Amortization | ||||||||||||||
Amortized intangible assets: | |||||||||||||||||
Managed care contracts | $ | 24,410 | $ | 2,656 | $ | 24,410 | $ | 1,798 | |||||||||
Wholesale contracts | 15,380 | 9,355 | 13,580 | 6,354 | |||||||||||||
39,790 | 12,011 | 37,990 | 8,152 | ||||||||||||||
Unamortized intangible assets: | |||||||||||||||||
Trademark | 8,680 | — | 8,680 | — | |||||||||||||
Other intangible assets | $ | 48,470 | $ | 12,011 | $ | 46,670 | $ | 8,152 | |||||||||
Managed care contracts | 30 years | |||
Wholesale contracts | 5 to 7 years |
2006 | $ | 3,827 | ||
2007 | 2,336 | |||
2008 | 1,591 | |||
2009 | 1,591 | |||
2010 | 1,568 |
8. | ACCOUNTS PAYABLE AND OTHER ACCRUED EXPENSES |
June 30, | ||||||||
2005 | 2004 | |||||||
Accounts payable | $ | 2,193 | $ | 2,968 | ||||
Accrued equipment related costs | 5,355 | 8,144 | ||||||
Accrued payroll and related costs | 11,677 | 8,905 | ||||||
Accrued interest expense | 4,214 | 4,266 | ||||||
Accrued professional fees | 2,365 | 2,539 | ||||||
Accrued income taxes | 223 | 468 | ||||||
Other accrued expenses | 10,442 | 8,447 | ||||||
$ | 36,469 | $ | 35,737 | |||||
F-14
Table of Contents
9. | NOTES PAYABLE |
June 30, | ||||||||
2005 | 2004 | |||||||
Notes payable to bank (Credit Facility), bearing interest at LIBOR plus 3.75% to 4.0% (7.26% at June 30, 2005), principal and interest payable quarterly, maturing in October 2008. The notes are collateralized by substantially all of our assets. | $ | 237,608 | $ | 270,047 | ||||
Unsecured senior subordinated notes payable (Notes), bearing interest at 9.875%, interest payable semi-annually, principal due in November 2011. At June 30, 2005, the fair value of the notes was approximately $198 million. | 250,000 | 250,000 | ||||||
Other notes payable | 718 | 914 | ||||||
Total notes payable | 488,326 | 520,961 | ||||||
Less: Current portion | 2,795 | 2,716 | ||||||
Long-term notes payable | $ | 485,531 | $ | 518,245 | ||||
2006 | $ | 2,795 | ||
2007 | 2,802 | |||
2008 | 179,557 | |||
2009 | 53,172 | |||
2010 | — | |||
Thereafter | 250,000 | |||
$ | 488,326 | |||
F-15
Table of Contents
10. | LEASE OBLIGATIONS, COMMITMENTS AND CONTINGENCIES |
Capital | Operating | ||||||||
2006 | $ | 5,802 | $ | 9,035 | |||||
2007 | 5,653 | 8,443 | |||||||
2008 | 2,930 | 7,151 | |||||||
2009 | 301 | 5,145 | |||||||
2010 | 25 | 3,421 | |||||||
Thereafter | — | 7,892 | |||||||
Total minimum lease payments | 14,711 | $ | 41,087 | ||||||
Less: Amounts representing interest | 1,469 | ||||||||
Present value of capital lease obligations | 13,242 | ||||||||
Less: Current portion | 4,927 | ||||||||
Long-term capital lease obligations | $ | 8,315 | |||||||
11. | CAPITAL STOCK |
F-16
Table of Contents
Weighted | |||||||||
Average | |||||||||
Shares | Exercise Price | ||||||||
Outstanding, June 30, 2002 | 772,990 | $ | 15.81 | ||||||
Granted | 25,500 | 19.01 | |||||||
Exercised | (50 | ) | 18.00 | ||||||
Repurchased | (56,000 | ) | 8.97 | ||||||
Forfeited | (109,625 | ) | 18.00 | ||||||
Outstanding, June 30, 2003 | 632,815 | 16.16 | |||||||
Granted | 30,000 | 19.07 | |||||||
Forfeited | (59,825 | ) | 18.27 | ||||||
Outstanding, June 30, 2004 | 602,990 | 16.10 | |||||||
Granted | 209,500 | 19.82 | |||||||
Forfeited | (195,500 | ) | 18.07 | ||||||
Outstanding, June 30, 2005 | 616,990 | $ | 16.74 | ||||||
Exercisable at: | |||||||||
June 30, 2003 | 148,465 | $ | 9.99 | ||||||
June 30, 2004 | 168,790 | $ | 10.96 | ||||||
June 30, 2005 | 204,565 | $ | 12.56 |
Weighted Average | Options | Total Options | Remaining Contractual | |||||||||||||
Exercise Price Range | Exercise Price | Exercisable | Outstanding | Life | ||||||||||||
$8.37 | $ | 8.37 | 123,490 | 123,490 | 6.33 years | |||||||||||
18.00 - 19.82 | 18.83 | 81,075 | 493,500 | 8.49 years | ||||||||||||
204,565 | 616,990 | |||||||||||||||
F-17
Table of Contents
12. | INCOME TAXES |
Years Ended June 30, | ||||||||||||||
2005 | 2004 | 2003 | ||||||||||||
Current provision: | ||||||||||||||
Federal | $ | — | $ | 1,640 | $ | 2,491 | ||||||||
State | (155 | ) | 310 | 775 | ||||||||||
(155 | ) | 1,950 | 3,266 | |||||||||||
Deferred taxes arising from temporary differences: | ||||||||||||||
State income taxes | (9 | ) | 173 | (176 | ) | |||||||||
Accrued expenses | (741 | ) | (46 | ) | 163 | |||||||||
Reserves | (1,376 | ) | 4,660 | 1,127 | ||||||||||
Depreciation and amortization | 8,971 | 9,694 | 7,718 | |||||||||||
Creation/utilization of net operating losses | (11,758 | ) | (8,167 | ) | (9,491 | ) | ||||||||
Section 481 adjustment | 1,161 | 1,161 | (2,343 | ) | ||||||||||
Changes in valuation allowance reducing goodwill | — | (6,800 | ) | — | ||||||||||
Changes in valuation allowance | 20,694 | — | 1,728 | |||||||||||
Non-goodwill intangible amortization | (1,001 | ) | (1,399 | ) | 1,200 | |||||||||
Other | (717 | ) | 724 | 74 | ||||||||||
Total deferred taxes arising from temporary differences | 15,224 | — | — | |||||||||||
Total provision for income taxes | $ | 15,069 | $ | 1,950 | $ | 3,266 | ||||||||
Years Ended June 30, | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
Federal statutory tax rate | 34.0 | % | 34.0 | % | 34.0 | % | ||||||
State income taxes, net of federal benefit | (11.8 | ) | 4.0 | 4.0 | ||||||||
Permanent items, including goodwill and non-deductible merger costs | (1.5 | ) | 2.0 | 1.0 | ||||||||
Changes in valuation allowance | (138.9 | ) | — | 1.0 | ||||||||
Other, net | (5.8 | ) | — | — | ||||||||
Net effective tax rate | (124.0 | )% | 40.0 | % | 40.0 | % | ||||||
F-18
Table of Contents
June 30, | |||||||||
2005 | 2004 | ||||||||
Accrued expenses | $ | 2,092 | $ | 1,351 | |||||
Depreciation and amortization | (43,273 | ) | (34,302 | ) | |||||
Reserves | 2,191 | 816 | |||||||
Section 481 adjustment | — | 1,161 | |||||||
State income taxes | 12 | 3 | |||||||
Non-goodwill intangible amortization | (7,436 | ) | (8,437 | ) | |||||
NOL carryforwards | 56,076 | 44,318 | |||||||
Other | 73 | (645 | ) | ||||||
Net deferred asset | 9,735 | 4,265 | |||||||
Valuation allowance | (24,959 | ) | (4,265 | ) | |||||
$ | (15,224 | ) | $ | — | |||||
13. | RETIREMENT SAVINGS PLANS |
14. | INVESTMENTS IN AND TRANSACTIONS WITH PARTNERSHIPS |
F-19
Table of Contents
June 30, | |||||||||
2005 | 2004 | ||||||||
Combined Financial Position: | |||||||||
Current assets: | |||||||||
Cash | $ | 3,534 | $ | 3,144 | |||||
Trade accounts receivables, net | 3,038 | 2,606 | |||||||
Other | 75 | 460 | |||||||
Property and equipment, net | 3,846 | 4,116 | |||||||
Intangible assets, net | 117 | 557 | |||||||
Total assets | 10,610 | 10,883 | |||||||
Current liabilities | (2,286 | ) | (2,465 | ) | |||||
Due to the Company | (912 | ) | (805 | ) | |||||
Long-term liabilities | (674 | ) | (1,117 | ) | |||||
Net assets | $ | 6,738 | $ | 6,496 | |||||
Years Ended June 30, | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
Operating Results: | ||||||||||||
Revenues | $ | 25,935 | $ | 19,455 | $ | 19,291 | ||||||
Expenses | 19,558 | 14,314 | 15,646 | |||||||||
Net income | $ | 6,377 | $ | 5,141 | $ | 3,645 | ||||||
Equity in earnings of unconsolidated partnerships | $ | 2,613 | $ | 2,181 | $ | 1,744 | ||||||
15. | RELATED PARTY TRANSACTIONS |
16. | SEGMENT INFORMATION |
F-20
Table of Contents
Mobile | Fixed | Other | Consolidated | ||||||||||||||
Year ended June 30, 2005: | |||||||||||||||||
Contract services revenues | $ | 118,891 | $ | 17,646 | $ | — | $ | 136,537 | |||||||||
Patient services revenues | 1,500 | 178,836 | — | 180,336 | |||||||||||||
Total revenues | 120,391 | 196,482 | — | 316,873 | |||||||||||||
Depreciation and amortization | 31,176 | 25,301 | 9,124 | 65,601 | |||||||||||||
Total costs of operations | 98,147 | 150,105 | 19,905 | 268,157 | |||||||||||||
Corporate operating expenses | — | — | (18,447 | ) | (18,447 | ) | |||||||||||
Loss on sales of centers | — | (170 | ) | — | (170 | ) | |||||||||||
Equity in earnings of unconsolidated partnerships | — | 2,613 | — | 2,613 | |||||||||||||
Interest expense, net | (8,572 | ) | (7,058 | ) | (29,230 | ) | (44,860 | ) | |||||||||
Income (loss) before income taxes | 13,672 | 41,762 | (67,582 | ) | (12,148 | ) | |||||||||||
Additions to property and equipment | 14,361 | 14,974 | 1,124 | 30,459 |
Mobile | Fixed | Other | Consolidated | ||||||||||||||
Year ended June 30, 2004: | |||||||||||||||||
Contract services revenues | $ | 112,219 | $ | 16,974 | $ | — | $ | 129,193 | |||||||||
Patient services revenues | 1,902 | 159,789 | — | 161,691 | |||||||||||||
Total revenues | 114,121 | 176,763 | — | 290,884 | |||||||||||||
Depreciation and amortization | 29,340 | 21,157 | 8,236 | 58,733 | |||||||||||||
Total costs of operations | 87,128 | 128,814 | 17,479 | 233,421 | |||||||||||||
Corporate operating expenses | — | — | (16,217 | ) | (16,217 | ) | |||||||||||
Gain on sale of center | — | 2,129 | — | 2,129 | |||||||||||||
Equity in earnings of unconsolidated partnerships | — | 2,181 | — | 2,181 | |||||||||||||
Interest expense, net | (11,562 | ) | (6,841 | ) | (22,279 | ) | (40,682 | ) | |||||||||
Income (loss) before income taxes | 15,431 | 45,418 | (55,975 | ) | 4,874 | ||||||||||||
Additions to property and equipment | 20,577 | 21,707 | 4,450 | 46,734 |
Mobile | Fixed | Other | Consolidated | ||||||||||||||
Year ended June 30, 2003: | |||||||||||||||||
Contract services revenues | $ | 95,912 | $ | 16,009 | $ | — | $ | 111,921 | |||||||||
Patient services revenues | 2,024 | 123,807 | — | 125,831 | |||||||||||||
Total revenues | 97,936 | 139,816 | — | 237,752 | |||||||||||||
Depreciation and amortization | 24,322 | 17,408 | 7,615 | 49,345 | |||||||||||||
Total costs of operations | 66,823 | 99,795 | 13,426 | 180,044 | |||||||||||||
Corporate operating expenses | — | — | (13,750 | ) | (13,750 | ) | |||||||||||
Equity in earnings of unconsolidated partnerships | 84 | 1,660 | — | 1,744 | |||||||||||||
Interest expense, net | (11,190 | ) | (8,259 | ) | (18,065 | ) | (37,514 | ) | |||||||||
Income (loss) before income taxes | 20,007 | 33,422 | (45,241 | ) | 8,188 | ||||||||||||
Additions to property and equipment | 29,598 | 22,581 | 4,788 | 56,967 |
F-21
Table of Contents
17. | RESULTS OF QUARTERLY OPERATIONS (unaudited) |
First | Second | Third | Fourth | ||||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Total | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||
2005: | |||||||||||||||||||||
Revenues | $ | 80,854 | $ | 78,115 | $ | 78,212 | $ | 79,692 | $ | 316,873 | |||||||||||
Gross profit | 14,109 | 12,659 | 11,502 | 10,446 | 48,716 | ||||||||||||||||
Net loss | (786 | ) | (1,134 | ) | (2,011 | ) | (23,286 | ) | (27,217 | ) | |||||||||||
2004: | |||||||||||||||||||||
Revenues | $ | 68,772 | $ | 69,946 | $ | 70,736 | $ | 81,430 | $ | 290,884 | |||||||||||
Gross profit | 15,550 | 13,178 | 13,556 | 15,179 | 57,463 | ||||||||||||||||
Net income (loss) | 1,610 | 1,344 | 281 | (311 | ) | 2,924 |
18. | SUBSEQUENT EVENT |
19. | SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION |
F-22
Table of Contents
Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | — | $ | 17,971 | $ | 2,868 | $ | — | $ | 20,839 | ||||||||||||||
Trade accounts receivables, net | — | — | 40,271 | 6,179 | — | 46,450 | ||||||||||||||||||||
Short-term investments | — | — | 5,000 | — | — | 5,000 | ||||||||||||||||||||
Other current assets | — | — | 7,487 | 483 | — | 7,970 | ||||||||||||||||||||
Intercompany accounts receivable | 87,086 | 487,828 | 17,294 | — | (592,208 | ) | — | |||||||||||||||||||
Total current assets | 87,086 | 487,828 | 88,023 | 9,530 | (592,208 | ) | 80,259 | |||||||||||||||||||
Property and equipment, net | — | — | 191,044 | 18,417 | — | 209,461 | ||||||||||||||||||||
Investments in partnerships | — | — | 3,513 | — | — | 3,513 | ||||||||||||||||||||
Investments in consolidated subsidiaries | (19,362 | ) | (19,362 | ) | 8,289 | — | 30,435 | — | ||||||||||||||||||
Other assets | — | — | 16,272 | 29 | — | 16,301 | ||||||||||||||||||||
Goodwill and other intangible assets, net | — | — | 310,486 | 4,503 | — | 314,989 | ||||||||||||||||||||
$ | 67,724 | $ | 468,466 | $ | 617,627 | $ | 32,479 | $ | (561,773 | ) | $ | 624,523 | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||
Current portion of notes payable and capital lease obligations | $ | — | $ | 2,564 | $ | 4,708 | $ | 450 | $ | — | $ | 7,722 | ||||||||||||||
Accounts payable and other accrued expenses | — | — | 34,915 | 1,554 | — | 36,469 | ||||||||||||||||||||
Intercompany accounts payable | — | — | 574,915 | 17,293 | (592,208 | ) | — | |||||||||||||||||||
Total current liabilities | — | 2,564 | 614,538 | 19,297 | (592,208 | ) | 44,191 | |||||||||||||||||||
Notes payable and capital lease obligations, less current portion | — | 485,044 | 7,504 | 1,298 | — | 493,846 | ||||||||||||||||||||
Other long-term liabilities | — | 220 | 14,947 | 3,595 | — | 18,762 | ||||||||||||||||||||
Stockholders’ equity | 67,724 | (19,362 | ) | (19,362 | ) | 8,289 | 30,435 | 67,724 | ||||||||||||||||||
$ | 67,724 | $ | 468,466 | $ | 617,627 | $ | 32,479 | $ | (561,773 | ) | $ | 624,523 | ||||||||||||||
F-23
Table of Contents
Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | — | $ | 25,820 | $ | 4,592 | $ | — | $ | 30,412 | ||||||||||||||
Trade accounts receivables, net | — | — | 47,048 | 7,962 | — | 55,010 | ||||||||||||||||||||
Other current assets | — | — | 6,058 | 149 | — | 6,207 | ||||||||||||||||||||
Intercompany accounts receivable | 87,086 | 520,047 | 19,865 | — | (626,998 | ) | — | |||||||||||||||||||
Total current assets | 87,086 | 520,047 | 98,791 | 12,703 | (626,998 | ) | 91,629 | |||||||||||||||||||
Property and equipment, net | — | — | 219,584 | 22,752 | — | 242,336 | ||||||||||||||||||||
Investments in partnerships | — | — | 2,901 | — | — | 2,901 | ||||||||||||||||||||
Investments in consolidated subsidiaries | 7,855 | 7,855 | 10,864 | — | (26,574 | ) | — | |||||||||||||||||||
Other assets | — | — | 19,218 | 84 | — | 19,302 | ||||||||||||||||||||
Goodwill and other intangible assets, net | — | — | 314,960 | 4,503 | — | 319,463 | ||||||||||||||||||||
$ | 94,941 | $ | 527,902 | $ | 666,318 | $ | 40,042 | $ | (653,572 | ) | $ | 675,631 | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||
Current portion of notes payable and capital lease obligations | $ | — | $ | 2,514 | $ | 4,540 | $ | 722 | $ | — | $ | 7,776 | ||||||||||||||
Accounts payable and other accrued expenses | — | — | 34,304 | 1,433 | — | 35,737 | ||||||||||||||||||||
Intercompany accounts payable | — | — | 607,133 | 19,865 | (626,998 | ) | — | |||||||||||||||||||
Total current liabilities | — | 2,514 | 645,977 | 22,020 | (626,998 | ) | 43,513 | |||||||||||||||||||
Notes payable and capital lease obligations, less current portion | — | 517,289 | 12,622 | 2,136 | — | 532,047 | ||||||||||||||||||||
Other long-term liabilities | — | 244 | (136 | ) | 5,022 | — | 5,130 | |||||||||||||||||||
Stockholders’ equity | 94,941 | 7,855 | 7,855 | 10,864 | (26,574 | ) | 94,941 | |||||||||||||||||||
$ | 94,941 | $ | 527,902 | $ | 666,318 | $ | 40,042 | $ | (653,572 | ) | $ | 675,631 | ||||||||||||||
F-24
Table of Contents
Parent | |||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | |||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Elimination | Consolidated | ||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Contract services | $ | — | $ | — | $ | 128,619 | $ | 7,918 | $ | — | $ | 136,537 | |||||||||||||||
Patient services | — | — | 146,953 | 33,383 | — | 180,336 | |||||||||||||||||||||
Total revenues | — | — | 275,572 | 41,301 | — | 316,873 | |||||||||||||||||||||
Costs of operations | — | — | 231,144 | 37,013 | — | 268,157 | |||||||||||||||||||||
Gross profit | — | — | 44,428 | 4,288 | — | 48,716 | |||||||||||||||||||||
Corporate operating expenses | — | — | (18,447 | ) | — | — | (18,447 | ) | |||||||||||||||||||
Loss on sales of centers | — | — | (170 | ) | — | — | (170 | ) | |||||||||||||||||||
Equity in earnings of unconsolidated partnerships | — | — | 2,613 | — | — | 2,613 | |||||||||||||||||||||
Interest expense, net | — | — | (43,615 | ) | (1,245 | ) | — | (44,860 | ) | ||||||||||||||||||
(Loss) income before income taxes | — | — | (15,191 | ) | 3,043 | — | (12,148 | ) | |||||||||||||||||||
Provision for income taxes | — | — | 15,069 | — | — | 15,069 | |||||||||||||||||||||
(Loss) income before equity in income (loss) of consolidated subsidiaries | — | — | (30,260 | ) | 3,043 | — | (27,217 | ) | |||||||||||||||||||
Equity in income (loss) of consolidated subsidiaries | (27,217 | ) | (27,217 | ) | 3,043 | — | 51,391 | — | |||||||||||||||||||
Net (loss) income | $ | (27,217 | ) | $ | (27,217 | ) | $ | (27,217 | ) | $ | 3,043 | $ | 51,391 | $ | (27,217 | ) | |||||||||||
F-25
Table of Contents
Parent | |||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | |||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Elimination | Consolidated | ||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Contract services | $ | — | $ | — | $ | 120,508 | $ | 8,685 | $ | — | $ | 129,193 | |||||||||||||||
Patient services | — | — | 121,919 | 39,772 | — | 161,691 | |||||||||||||||||||||
Total revenues | — | — | 242,427 | 48,457 | — | 290,884 | |||||||||||||||||||||
Costs of operations | — | — | 191,303 | 42,118 | — | 233,421 | |||||||||||||||||||||
Gross profit | — | — | 51,124 | 6,339 | — | 57,463 | |||||||||||||||||||||
Corporate operating expenses | — | — | (16,217 | ) | — | — | (16,217 | ) | |||||||||||||||||||
Gain on sale of center | — | — | 2,129 | — | — | 2,129 | |||||||||||||||||||||
Equity in earnings of unconsolidated partnerships | — | — | 2,181 | — | — | 2,181 | |||||||||||||||||||||
Interest expense, net | — | — | (39,235 | ) | (1,447 | ) | — | (40,682 | ) | ||||||||||||||||||
(Loss) income before income taxes | — | — | (18 | ) | 4,892 | — | 4,874 | ||||||||||||||||||||
Provision for income taxes | — | — | 1,950 | — | — | 1,950 | |||||||||||||||||||||
(Loss) income before equity in income of consolidated subsidiaries | — | — | (1,968 | ) | 4,892 | — | 2,924 | ||||||||||||||||||||
Equity in income of consolidated subsidiaries | 2,924 | 2,924 | 4,892 | — | (10,740 | ) | — | ||||||||||||||||||||
Net income | $ | 2,924 | $ | 2,924 | $ | 2,924 | $ | 4,892 | $ | (10,740 | ) | $ | 2,924 | ||||||||||||||
F-26
Table of Contents
Parent | |||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | |||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Elimination | Consolidated | ||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Contract services | $ | — | $ | — | $ | 103,446 | $ | 8,475 | $ | — | $ | 111,921 | |||||||||||||||
Patient services | — | — | 90,509 | 35,322 | — | 125,831 | |||||||||||||||||||||
Total revenues | — | — | 193,955 | 43,797 | — | 237,752 | |||||||||||||||||||||
Costs of operations | — | — | 142,668 | 37,376 | — | 180,044 | |||||||||||||||||||||
Gross profit | — | — | 51,287 | 6,421 | — | 57,708 | |||||||||||||||||||||
Corporate operating expenses | — | — | (13,750 | ) | — | — | (13,750 | ) | |||||||||||||||||||
Equity in earnings of unconsolidated partnerships | — | — | 1,744 | — | — | 1,744 | |||||||||||||||||||||
Interest expense, net | — | — | (35,601 | ) | (1,913 | ) | — | (37,514 | ) | ||||||||||||||||||
Income before income taxes | — | — | 3,680 | 4,508 | — | 8,188 | |||||||||||||||||||||
Provision for income taxes | — | — | 3,266 | — | — | 3,266 | |||||||||||||||||||||
Income before equity in income of consolidated subsidiaries | — | — | 414 | 4,508 | — | 4,922 | |||||||||||||||||||||
Equity in income of consolidated subsidiaries | 4,922 | 4,922 | 4,508 | — | (14,352 | ) | — | ||||||||||||||||||||
Net income | $ | 4,922 | $ | 4,922 | $ | 4,922 | $ | 4,508 | $ | (14,352 | ) | $ | 4,922 | ||||||||||||||
F-27
Table of Contents
Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net (loss) income | $ | (27,217 | ) | $ | (27,217 | ) | $ | (27,217 | ) | $ | 3,043 | $ | 51,391 | $ | (27,217 | ) | ||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Loss on sales of centers | — | — | 170 | — | — | 170 | ||||||||||||||||||||
Depreciation and amortization | — | — | 60,261 | 5,340 | — | 65,601 | ||||||||||||||||||||
Deferred income taxes | — | — | 15,224 | — | — | 15,224 | ||||||||||||||||||||
Equity in (loss) income of consolidated subsidiaries | 27,217 | 27,217 | (3,043 | ) | — | (51,391 | ) | — | ||||||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||||||||
Trade accounts receivables, net | — | — | 6,634 | 1,462 | — | 8,096 | ||||||||||||||||||||
Intercompany receivables, net | — | 32,219 | (24,931 | ) | (7,288 | ) | — | — | ||||||||||||||||||
Other current assets | — | — | (1,397 | ) | (339 | ) | — | (1,736 | ) | |||||||||||||||||
Accounts payable and other accrued expenses | — | — | 539 | 187 | — | 726 | ||||||||||||||||||||
Net cash provided by operating activities | — | 32,219 | 26,240 | 2,405 | — | 60,864 | ||||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Proceeds from sales of centers | — | — | 2,810 | — | — | 2,810 | ||||||||||||||||||||
Additions to property and equipment | — | — | (28,449 | ) | (2,010 | ) | — | (30,459 | ) | |||||||||||||||||
Net purchases of short-term investments | — | — | (5,000 | ) | — | — | (5,000 | ) | ||||||||||||||||||
Other | — | — | 1,554 | (1,483 | ) | — | 71 | |||||||||||||||||||
Net cash used in investing activities | — | — | (29,085 | ) | (3,493 | ) | — | (32,578 | ) | |||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Principal payments of notes payable and capital lease obligations | — | (32,195 | ) | (4,950 | ) | (636 | ) | — | (37,781 | ) | ||||||||||||||||
Other | — | (24 | ) | (54 | ) | — | — | (78 | ) | |||||||||||||||||
Net cash used in financing activities | — | (32,219 | ) | (5,004 | ) | (636 | ) | — | (37,859 | ) | ||||||||||||||||
DECREASE IN CASH AND CASH EQUIVALENTS | — | — | (7,849 | ) | (1,724 | ) | — | (9,573 | ) | |||||||||||||||||
Cash, beginning of year | — | — | 25,820 | 4,592 | — | 30,412 | ||||||||||||||||||||
Cash, end of year | $ | — | $ | — | $ | 17,971 | $ | 2,868 | $ | — | $ | 20,839 | ||||||||||||||
F-28
Table of Contents
Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net income | $ | 2,924 | $ | 2,924 | $ | 2,924 | $ | 4,892 | $ | (10,740 | ) | $ | 2,924 | |||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Gain on sale of center | — | — | (2,129 | ) | — | — | (2,129 | ) | ||||||||||||||||||
Depreciation and amortization | — | — | 53,266 | 5,467 | — | 58,733 | ||||||||||||||||||||
Equity in income of consolidated subsidiaries | (2,924 | ) | (2,924 | ) | (4,892 | ) | — | 10,740 | — | |||||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||||||||
Trade accounts receivables, net | — | — | (9,158 | ) | 703 | — | (8,455 | ) | ||||||||||||||||||
Intercompany receivables, net | — | (97,056 | ) | 103,500 | (6,444 | ) | — | — | ||||||||||||||||||
Other current assets | — | — | 2,781 | 303 | — | 3,084 | ||||||||||||||||||||
Accounts payable and other accrued expenses | — | — | 5,596 | 367 | — | 5,963 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | — | (97,056 | ) | 151,888 | 5,288 | — | 60,120 | |||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Acquisitions of fixed-site centers and mobile facilities | — | — | (101,334 | ) | — | — | (101,334 | ) | ||||||||||||||||||
Proceeds from sale of center | — | — | 5,413 | — | — | 5,413 | ||||||||||||||||||||
Additions to property and equipment | — | — | (40,979 | ) | (5,755 | ) | — | (46,734 | ) | |||||||||||||||||
Other | — | — | 405 | — | — | 405 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | — | — | (136,495 | ) | (5,755 | ) | — | (142,250 | ) | |||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Principal payments of notes payable and capital lease obligations | — | (2,201 | ) | (5,319 | ) | (689 | ) | — | (8,209 | ) | ||||||||||||||||
Proceeds from issuance of notes payable | — | 100,000 | — | 1,125 | — | 101,125 | ||||||||||||||||||||
Other | — | (743 | ) | (219 | ) | 1,034 | — | 72 | ||||||||||||||||||
Net cash provided by (used in) financing activities | — | 97,056 | (5,538 | ) | 1,470 | — | 92,988 | |||||||||||||||||||
INCREASE IN CASH AND CASH EQUIVALENTS | — | — | 9,855 | 1,003 | — | 10,858 | ||||||||||||||||||||
Cash, beginning of year | — | — | 15,965 | 3,589 | — | 19,554 | ||||||||||||||||||||
Cash, end of year | $ | — | $ | — | $ | 25,820 | $ | 4,592 | $ | — | $ | 30,412 | ||||||||||||||
F-29
Table of Contents
Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net income | $ | 4,922 | $ | 4,922 | $ | 4,922 | $ | 4,507 | $ | (14,351 | ) | $ | 4,922 | |||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Depreciation and amortization | — | — | 43,681 | 5,664 | — | 49,345 | ||||||||||||||||||||
Equity in income of consolidated subsidiaries | (4,922 | ) | (4,922 | ) | (4,507 | ) | — | 14,351 | — | |||||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||||||||
Trade accounts receivables, net | — | — | (2,241 | ) | 4 | — | (2,237 | ) | ||||||||||||||||||
Intercompany receivables, net | 505 | (48,373 | ) | 52,838 | (4,970 | ) | — | — | ||||||||||||||||||
Other current assets | — | — | 5,131 | (224 | ) | — | 4,907 | |||||||||||||||||||
Accounts payable and other accrued expenses | — | — | 4,862 | (43 | ) | — | 4,819 | |||||||||||||||||||
Net cash provided by (used in) operating activities | 505 | (48,373 | ) | 104,686 | 4,938 | — | 61,756 | |||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Acquisitions of fixed-site centers | — | — | (46,292 | ) | — | — | (46,292 | ) | ||||||||||||||||||
Additions to property and equipment | — | — | (51,827 | ) | (5,140 | ) | — | (56,967 | ) | |||||||||||||||||
Other | — | — | 554 | — | — | 554 | ||||||||||||||||||||
Net cash used in investing activities | — | — | (97,565 | ) | (5,140 | ) | — | (102,705 | ) | |||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Proceeds from stock options exercised | 1 | — | — | — | — | 1 | ||||||||||||||||||||
Purchase of stock options | (506 | ) | — | — | — | — | (506 | ) | ||||||||||||||||||
Principal payments of notes payable and capital lease obligations | — | (1,627 | ) | (5,453 | ) | (420 | ) | — | (7,500 | ) | ||||||||||||||||
Proceeds from issuance of notes payable | — | 50,000 | — | — | — | 50,000 | ||||||||||||||||||||
Other | — | — | (154 | ) | 879 | — | 725 | |||||||||||||||||||
Net cash (used in) provided by financing activities | (505 | ) | 48,373 | (5,607 | ) | 459 | — | 42,720 | ||||||||||||||||||
INCREASE IN CASH AND CASH EQUIVALENTS | — | — | 1,514 | 257 | — | 1,771 | ||||||||||||||||||||
Cash, beginning of year | — | — | 14,451 | 3,332 | — | 17,783 | ||||||||||||||||||||
Cash, end of year | $ | — | $ | — | $ | 15,965 | $ | 3,589 | $ | — | $ | 19,554 | ||||||||||||||
F-30
Table of Contents
Balance at | Balance at | ||||||||||||||||||||
Beginning of | Charges to | Charges to | End of | ||||||||||||||||||
Year | Expenses | Revenues | Other | Year | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||
June 30, 2003: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 7,980 | $ | 4,154 | $ | — | $ | (4,230 | )(A) | $ | 7,904 | ||||||||||
Allowance for contractual adjustments | 18,510 | — | 122,101 | (112,242 | )(B) | 28,369 | |||||||||||||||
$ | 26,490 | $ | 4,154 | $ | 122,101 | $ | (116,472 | ) | $ | 36,273 | |||||||||||
June 30, 2004: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 7,904 | $ | 4,998 | $ | — | $ | (4,805 | )(A) | $ | 8,097 | ||||||||||
Allowance for contractual adjustments | 28,369 | — | 176,172 | (167,332 | )(B) | 37,209 | |||||||||||||||
$ | 36,273 | $ | 4,998 | $ | 176,172 | $ | (172,137 | ) | $ | 45,306 | |||||||||||
June 30, 2005: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 8,097 | $ | 5,723 | $ | — | $ | (4,933 | )(A) | $ | 8,887 | ||||||||||
Allowance for contractual adjustments | 37,209 | — | 194,928 | (202,725 | )(B) | 29,412 | |||||||||||||||
$ | 45,306 | $ | 5,723 | $ | 194,928 | $ | (207,658 | ) | $ | 38,299 | |||||||||||
(A) | Write-off of uncollectible accounts. | |
(B) | Write-off of contractual adjustments, representing the difference between our charge for a procedure and what we receive from payors. |
F-31
Table of Contents
September 30, | June 30, | |||||||||
2005 | 2005 | |||||||||
(Amounts in thousands, | ||||||||||
except share data) | ||||||||||
ASSETS | ||||||||||
CURRENT ASSETS: | ||||||||||
Cash and cash equivalents | $ | 27,390 | $ | 20,839 | ||||||
Trade accounts receivables, net | 46,166 | 46,450 | ||||||||
Short-term investments | — | 5,000 | ||||||||
Other current assets | 6,615 | 7,970 | ||||||||
Total current assets | 80,171 | 80,259 | ||||||||
PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $191,532 and $176,784, respectively | 209,203 | 209,461 | ||||||||
INVESTMENTS IN PARTNERSHIPS | 3,593 | 3,513 | ||||||||
OTHER ASSETS | 18,179 | 16,301 | ||||||||
OTHER INTANGIBLE ASSETS, net | 35,594 | 36,459 | ||||||||
GOODWILL | 278,528 | 278,530 | ||||||||
$ | 625,268 | $ | 624,523 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
CURRENT LIABILITIES: | ||||||||||
Current portion of notes payable | $ | 233 | $ | 2,795 | ||||||
Current portion of capital lease obligations | 5,123 | 4,927 | ||||||||
Accounts payable and other accrued expenses | 33,553 | 36,469 | ||||||||
Total current liabilities | 38,909 | 44,191 | ||||||||
LONG-TERM LIABILITIES: | ||||||||||
Notes payable, less current portion | 493,431 | 485,531 | ||||||||
Capital lease obligations, less current portion | 7,619 | 8,315 | ||||||||
Other long-term liabilities | 3,758 | 3,538 | ||||||||
Deferred income taxes | 16,274 | 15,224 | ||||||||
Total long-term liabilities | 521,082 | 512,608 | ||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||
STOCKHOLDERS’ EQUITY: | ||||||||||
Common stock, $.001 par value, 10,000,000 shares authorized, 5,468,814 shares issued and outstanding at September 30, 2005 and June 30, 2005 | 5 | 5 | ||||||||
Additional paid-in capital | 87,081 | 87,081 | ||||||||
Accumulated deficit | (21,809 | ) | (19,362 | ) | ||||||
Total stockholders’ equity | 65,277 | 67,724 | ||||||||
$ | 625,268 | $ | 624,523 | |||||||
F-32
Table of Contents
Three Months Ended | ||||||||||
September 30, | ||||||||||
2005 | 2004 | |||||||||
(Amounts in thousands) | ||||||||||
REVENUES: | ||||||||||
Contract services | $ | 34,377 | $ | 33,568 | ||||||
Patient services | 44,331 | 47,286 | ||||||||
Total revenues | 78,708 | 80,854 | ||||||||
COSTS OF OPERATIONS: | ||||||||||
Costs of services | 48,266 | 48,458 | ||||||||
Provision for doubtful accounts | 1,183 | 1,606 | ||||||||
Equipment leases | 1,022 | 333 | ||||||||
Depreciation and amortization | 15,774 | 16,348 | ||||||||
Total costs of operations | 66,245 | 66,745 | ||||||||
Gross profit | 12,463 | 14,109 | ||||||||
CORPORATE OPERATING EXPENSES | (5,553 | ) | (4,855 | ) | ||||||
EQUITY IN EARNINGS OF UNCONSOLIDATED PARTNERSHIPS | 833 | 400 | ||||||||
INTEREST EXPENSE, net | (12,166 | ) | (10,964 | ) | ||||||
GAIN ON REPURCHASE OF NOTES PAYABLE | 3,076 | — | ||||||||
Loss before provision (benefit) for income taxes | (1,347 | ) | (1,310 | ) | ||||||
PROVISION (BENEFIT) FOR INCOME TAXES | 1,100 | (524 | ) | |||||||
Net loss | $ | (2,447 | ) | $ | (786 | ) | ||||
F-33
Table of Contents
Three Months Ended | |||||||||||
September 30, | |||||||||||
2005 | 2004 | ||||||||||
(Amounts in thousands) | |||||||||||
OPERATING ACTIVITIES: | |||||||||||
Net loss | $ | (2,447 | ) | $ | (786 | ) | |||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 15,774 | 16,348 | |||||||||
Gain on repurchase of notes payable | (3,076 | ) | — | ||||||||
Deferred income taxes | 1,050 | — | |||||||||
Cash provided by (used in) changes in operating assets and liabilities: | |||||||||||
Trade accounts receivables, net | 284 | 1,144 | |||||||||
Other current assets | 1,355 | 524 | |||||||||
Accounts payable and other accrued expenses | (2,916 | ) | 3,592 | ||||||||
Net cash provided by operating activities | 10,024 | 20,822 | |||||||||
INVESTING ACTIVITIES: | |||||||||||
Additions to property and equipment | (13,885 | ) | (8,219 | ) | |||||||
Sale of short-term investments | 5,000 | — | |||||||||
Other | 1,433 | 192 | |||||||||
Net cash used in investing activities | (7,452 | ) | (8,027 | ) | |||||||
FINANCING ACTIVITIES: | |||||||||||
Principal payments of notes payable and capital lease obligations | (288,849 | ) | (2,081 | ) | |||||||
Proceeds from issuance of notes payable | 298,500 | — | |||||||||
Payments made in connection with refinancing of notes payable | (5,672 | ) | — | ||||||||
Other | — | 151 | |||||||||
Net cash provided by (used in) financing activities | 3,979 | (1,930 | ) | ||||||||
INCREASE IN CASH AND CASH EQUIVALENTS | 6,551 | 10,865 | |||||||||
Cash, beginning of period | 20,839 | 30,412 | |||||||||
Cash, end of period | $ | 27,390 | $ | 41,277 | |||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||||||
Interest paid | $ | 6,564 | $ | 4,128 | |||||||
Income taxes paid | 67 | 222 | |||||||||
Equipment additions under capital leases | 737 | — |
F-34
Table of Contents
1. | NATURE OF BUSINESS |
2. | INTERIM FINANCIAL STATEMENTS |
3. | INVESTMENTS IN AND TRANSACTIONS WITH PARTNERSHIPS |
4. | GOODWILL AND OTHER INTANGIBLE ASSETS |
F-35
Table of Contents
Mobile | Fixed | Consolidated | ||||||||||
(Unaudited) | ||||||||||||
Goodwill, June 30, 2005 | $ | 104,264 | $ | 174,266 | $ | 278,530 | ||||||
Adjustments to goodwill | — | (2 | ) | (2 | ) | |||||||
Goodwill, September 30, 2005 | $ | 104,264 | $ | 174,264 | $ | 278,528 | ||||||
September 30, 2005 | June 30, 2005 | |||||||||||||||
Gross | Gross | |||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | |||||||||||||
Value | Amortization | Value | Amortization | |||||||||||||
(Unaudited) | ||||||||||||||||
Amortized intangible assets: | ||||||||||||||||
Managed care contracts | $ | 24,410 | $ | 2,776 | $ | 24,410 | $ | 2,656 | ||||||||
Wholesale contracts | 15,380 | 10,100 | 15,380 | 9,355 | ||||||||||||
39,790 | 12,876 | 39,790 | 12,011 | |||||||||||||
Unamortized intangible assets: | ||||||||||||||||
Trademark | 8,680 | — | 8,680 | — | ||||||||||||
Other intangible assets | $ | 48,470 | $ | 12,876 | $ | 48,470 | $ | 12,011 | ||||||||
F-36
Table of Contents
Managed care contracts | 30 years | |||
Wholesale contracts | 5-7 years |
5. | NOTES PAYABLE |
6. | CAPITAL STOCK |
F-37
Table of Contents
Three Months | |||||||||
Ended | |||||||||
September 30, | |||||||||
2005 | 2004 | ||||||||
(Unaudited) | |||||||||
Net loss: | |||||||||
As reported | $ | (2,447 | ) | $ | (786 | ) | |||
Expense | (71 | ) | (66 | ) | |||||
Pro-forma | $ | (2,518 | ) | $ | (852 | ) | |||
Expected term (years) | 10 | |||
Volatility | 0 | % | ||
Annual dividend per share | $ | 0 | ||
Risk-free interest rate | 4.13 | % | ||
Weighted-average fair value of options granted | $ | 6.65 |
7. | SEGMENT INFORMATION |
F-38
Table of Contents
Mobile | Fixed | Other | Consolidated | ||||||||||||||
Three months ended September 30, 2005: | |||||||||||||||||
Contract services revenues | $ | 29,551 | $ | 4,826 | $ | — | $ | 34,377 | |||||||||
Patient services revenues | 425 | 43,906 | — | 44,331 | |||||||||||||
Total revenues | 29,976 | 48,732 | — | 78,708 | |||||||||||||
Depreciation and amortization | 7,547 | 6,102 | 2,125 | 15,774 | |||||||||||||
Total costs of operations | 24,976 | 36,506 | 4,763 | 66,245 | |||||||||||||
Corporate operating expenses | — | — | (5,553 | ) | (5,553 | ) | |||||||||||
Equity in earnings of unconsolidated partnerships | — | 833 | — | 833 | |||||||||||||
Interest expense, net | (1,705 | ) | (1,581 | ) | (8,880 | ) | (12,166 | ) | |||||||||
Gain on repurchase of notes payable | — | — | 3,076 | 3,076 | |||||||||||||
Income (loss) before income taxes | 3,295 | 11,478 | (16,120 | ) | (1,347 | ) | |||||||||||
Additions to property and equipment | 8,162 | 4,934 | 789 | 13,885 |
Mobile | Fixed | Other | Consolidated | ||||||||||||||
Three months ended September 30, 2004: | |||||||||||||||||
Contract services revenues | $ | 29,660 | $ | 3,908 | $ | — | $ | 33,568 | |||||||||
Patient services revenues | 396 | 46,890 | — | 47,286 | |||||||||||||
Total revenues | 30,056 | 50,798 | — | 80,854 | |||||||||||||
Depreciation and amortization | 7,815 | 6,272 | 2,261 | 16,348 | |||||||||||||
Total costs of operations | 23,760 | 37,914 | 5,071 | 66,745 | |||||||||||||
Corporate operating expenses | — | — | (4,855 | ) | (4,855 | ) | |||||||||||
Equity in earnings of unconsolidated partnerships | — | 400 | — | 400 | |||||||||||||
Interest expense, net | (2,474 | ) | (1,735 | ) | (6,755 | ) | (10,964 | ) | |||||||||
Income (loss) before income taxes | 3,822 | 11,549 | (16,681 | ) | (1,310 | ) | |||||||||||
Additions to property and equipment | 2,964 | 4,504 | 751 | 8,219 |
8. | NEW PRONOUNCEMENTS |
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F-40
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Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | — | $ | 24,382 | $ | 3,008 | $ | — | $ | 27,390 | ||||||||||||||
Trade accounts receivables, net | — | — | 39,852 | 6,314 | — | 46,166 | ||||||||||||||||||||
Other current assets | — | — | 6,239 | 376 | — | 6,615 | ||||||||||||||||||||
Intercompany accounts receivable | 87,086 | 496,290 | 16,101 | 208 | (599,685 | ) | — | |||||||||||||||||||
Total current assets | 87,086 | 496,290 | 86,574 | 9,906 | (599,685 | ) | 80,171 | |||||||||||||||||||
Property and equipment, net | — | — | 191,059 | 18,144 | — | 209,203 | ||||||||||||||||||||
Investments in partnerships | — | — | 3,593 | — | — | 3,593 | ||||||||||||||||||||
Investments in consolidated subsidiaries | (21,809 | ) | (24,885 | ) | 8,452 | — | 38,242 | — | ||||||||||||||||||
Other assets | — | — | 18,155 | 24 | — | 18,179 | ||||||||||||||||||||
Goodwill and other intangible assets, net | — | — | 309,619 | 4,503 | — | 314,122 | ||||||||||||||||||||
$ | 65,277 | $ | 471,405 | $ | 617,452 | $ | 32,577 | $ | (561,443 | ) | $ | 625,268 | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||
Current portion of notes payable and capital lease obligations | $ | — | $ | — | $ | 4,769 | $ | 587 | $ | — | $ | 5,356 | ||||||||||||||
Accounts payable and other accrued expenses | — | — | 31,606 | 1,947 | — | 33,553 | ||||||||||||||||||||
Intercompany accounts payable | — | — | 583,584 | 16,101 | (599,685 | ) | — | |||||||||||||||||||
Total current liabilities | — | — | 619,959 | 18,635 | (599,685 | ) | 38,909 | |||||||||||||||||||
Notes payable and capital lease obligations, less current portion | — | 493,000 | 6,294 | 1,756 | — | 501,050 | ||||||||||||||||||||
Other long-term liabilities | — | 214 | 16,084 | 3,734 | — | 20,032 | ||||||||||||||||||||
Stockholders’ equity | 65,277 | (21,809 | ) | (24,885 | ) | 8,452 | 38,242 | 65,277 | ||||||||||||||||||
$ | 65,277 | $ | 471,405 | $ | 617,452 | $ | 32,577 | $ | (561,443 | ) | $ | 625,268 | ||||||||||||||
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Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | — | $ | 17,971 | $ | 2,868 | $ | — | $ | 20,839 | ||||||||||||||
Trade accounts receivables, net | — | — | 40,271 | 6,179 | — | 46,450 | ||||||||||||||||||||
Short-term investments | — | — | 5,000 | — | — | 5,000 | ||||||||||||||||||||
Other current assets | — | — | 7,487 | 483 | — | 7,970 | ||||||||||||||||||||
Intercompany accounts receivable | 87,086 | 487,828 | 17,294 | — | (592,208 | ) | — | |||||||||||||||||||
Total current assets | 87,086 | 487,828 | 88,023 | 9,530 | (592,208 | ) | 80,259 | |||||||||||||||||||
Property and equipment, net | — | — | 191,044 | 18,417 | — | 209,461 | ||||||||||||||||||||
Investments in partnerships | — | — | 3,513 | — | — | 3,513 | ||||||||||||||||||||
Investments in consolidated subsidiaries | (19,362 | ) | (19,362 | ) | 8,289 | — | 30,435 | — | ||||||||||||||||||
Other assets | — | — | 16,272 | 29 | — | 16,301 | ||||||||||||||||||||
Goodwill and other intangible assets, net | — | — | 310,486 | 4,503 | — | 314,989 | ||||||||||||||||||||
$ | 67,724 | $ | 468,466 | $ | 617,627 | $ | 32,479 | $ | (561,773 | ) | $ | 624,523 | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||
Current portion of notes payable and capital lease obligations | $ | — | $ | 2,564 | $ | 4,708 | $ | 450 | $ | — | $ | 7,722 | ||||||||||||||
Accounts payable and other accrued expenses | — | — | 34,915 | 1,554 | — | 36,469 | ||||||||||||||||||||
Intercompany accounts payable | — | — | 574,915 | 17,293 | (592,208 | ) | — | |||||||||||||||||||
Total current liabilities | — | 2,564 | 614,538 | 19,297 | (592,208 | ) | 44,191 | |||||||||||||||||||
Notes payable and capital lease obligations, less current portion | — | 485,044 | 7,504 | 1,298 | — | 493,846 | ||||||||||||||||||||
Other long-term liabilities | — | 220 | 14,947 | 3,595 | — | 18,762 | ||||||||||||||||||||
Stockholders’ equity | 67,724 | (19,362 | ) | (19,362 | ) | 8,289 | 30,435 | 67,724 | ||||||||||||||||||
$ | 67,724 | $ | 468,466 | $ | 617,627 | $ | 32,479 | $ | (561,773 | ) | $ | 624,523 | ||||||||||||||
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Parent | |||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Elimination | Consolidated | ||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||
Revenues | $ | — | $ | — | $ | 68,922 | $ | 9,786 | $ | — | $ | 78,708 | |||||||||||||
Costs of operations | — | — | 57,478 | 8,767 | — | 66,245 | |||||||||||||||||||
Gross profit | — | — | 11,444 | 1,019 | — | 12,463 | |||||||||||||||||||
Corporate operating expenses | — | — | (5,553 | ) | — | — | (5,553 | ) | |||||||||||||||||
Equity in earnings of unconsolidated partnerships | — | — | 833 | — | — | 833 | |||||||||||||||||||
Interest expense, net | — | — | (11,879 | ) | (287 | ) | — | (12,166 | ) | ||||||||||||||||
Gain on repurchase of notes payable | — | 3,076 | — | — | — | 3,076 | |||||||||||||||||||
Income (loss) before income taxes | — | 3,076 | (5,155 | ) | 732 | — | (1,347 | ) | |||||||||||||||||
Provision for income taxes | — | — | 1,100 | — | — | 1,100 | |||||||||||||||||||
Income (loss) before equity in income of consolidated subsidiaries | — | 3,076 | (6,255 | ) | 732 | — | (2,447 | ) | |||||||||||||||||
Equity in income of consolidated subsidiaries | (2,447 | ) | (5,523 | ) | 732 | — | 7,238 | — | |||||||||||||||||
Net (loss) income | $ | (2,447 | ) | $ | (2,447 | ) | $ | (5,523 | ) | $ | 732 | $ | 7,238 | $ | (2,447 | ) | |||||||||
F-43
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Parent | |||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Elimination | Consolidated | ||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||
Revenues | $ | — | $ | — | $ | 68,757 | $ | 12,097 | $ | — | $ | 80,854 | |||||||||||||
Costs of operations | — | — | 56,199 | 10,546 | — | 66,745 | |||||||||||||||||||
Gross profit | — | — | 12,558 | 1,551 | — | 14,109 | |||||||||||||||||||
Corporate operating expenses | — | — | (4,855 | ) | — | — | (4,855 | ) | |||||||||||||||||
Equity in earnings of unconsolidated partnerships | — | — | 400 | — | — | 400 | |||||||||||||||||||
Interest expense, net | — | — | (10,636 | ) | (328 | ) | — | (10,964 | ) | ||||||||||||||||
(Loss) income before income taxes | — | — | (2,533 | ) | 1,223 | — | (1,310 | ) | |||||||||||||||||
Benefit for income taxes | — | — | (524 | ) | — | — | (524 | ) | |||||||||||||||||
(Loss) income before equity in income of consolidated subsidiaries | — | — | (2,009 | ) | 1,223 | — | (786 | ) | |||||||||||||||||
Equity in income of consolidated subsidiaries | (786 | ) | (786 | ) | 1,223 | — | 349 | — | |||||||||||||||||
Net (loss) income | $ | (786 | ) | $ | (786 | ) | $ | (786 | ) | $ | 1,223 | $ | 349 | $ | (786 | ) | |||||||||
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Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net (loss) income | $ | (2,447 | ) | $ | (2,447 | ) | $ | (5,523 | ) | $ | 732 | $ | 7,238 | $ | (2,447 | ) | ||||||||||
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Depreciation and amortization | — | — | 14,460 | 1,314 | — | 15,774 | ||||||||||||||||||||
Gain on repurchase of notes payable | — | (3,076 | ) | — | — | — | (3,076 | ) | ||||||||||||||||||
Deferred income taxes | — | — | 1,050 | — | — | 1,050 | ||||||||||||||||||||
Equity in income of consolidated subsidiaries | 2,447 | 5,523 | (732 | ) | — | (7,238 | ) | — | ||||||||||||||||||
Cash provided by (used in) changes in operating assets and liabilities: | ||||||||||||||||||||||||||
Trade accounts receivables, net | — | — | 419 | (135 | ) | — | 284 | |||||||||||||||||||
Intercompany receivables, net | — | (5,270 | ) | 7,239 | (1,969 | ) | — | — | ||||||||||||||||||
Other current assets | — | — | 1,248 | 107 | — | 1,355 | ||||||||||||||||||||
Accounts payable and other accrued expenses | — | — | (3,309 | ) | 393 | — | (2,916 | ) | ||||||||||||||||||
Net cash provided by (used in) operating activities | — | (5,270 | ) | 14,852 | 442 | — | 10,024 | |||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Additions to property and equipment | — | — | (13,586 | ) | (299 | ) | — | (13,885 | ) | |||||||||||||||||
Net sales of short-term investments | — | — | 5,000 | — | — | 5,000 | ||||||||||||||||||||
Other | — | — | 1,294 | 139 | — | 1,433 | ||||||||||||||||||||
Net cash used in investing activities | — | — | (7,292 | ) | (160 | ) | — | (7,452 | ) | |||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Principal payments of notes payable and capital lease obligations | — | (287,558 | ) | (1,149 | ) | (142 | ) | — | (288,849 | ) | ||||||||||||||||
Proceeds from issuance of notes payable | — | 298,500 | — | — | — | 298,500 | ||||||||||||||||||||
Payments made in connection with refinancing notes payable | — | (5,672 | ) | — | — | — | (5,672 | ) | ||||||||||||||||||
Net cash provided by (used in) financing activities | — | 5,270 | (1,149 | ) | (142 | ) | — | 3,979 | ||||||||||||||||||
INCREASE IN CASH AND CASH EQUIVALENTS | — | — | 6,411 | 140 | — | 6,551 | ||||||||||||||||||||
Cash, beginning of period | — | — | 17,971 | 2,868 | — | 20,839 | ||||||||||||||||||||
Cash, end of period | $ | — | $ | — | $ | 24,382 | $ | 3,008 | $ | — | $ | 27,390 | ||||||||||||||
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Parent | ||||||||||||||||||||||||||
Company | Guarantor | Non-Guarantor | ||||||||||||||||||||||||
Only | InSight | Subsidiaries | Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net (loss) income | $ | (786 | ) | $ | (786 | ) | $ | (786 | ) | $ | 1,223 | $ | 349 | $ | (786 | ) | ||||||||||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||||||||||||||||||||
Depreciation and amortization | — | — | 15,050 | 1,298 | — | 16,348 | ||||||||||||||||||||
Equity in income of consolidated subsidiaries | 786 | 786 | (1,223 | ) | — | (349 | ) | — | ||||||||||||||||||
Cash provided by (used in) changes in operating assets and liabilities: | ||||||||||||||||||||||||||
Trade accounts receivables, net | — | — | 1,210 | (66 | ) | — | 1,144 | |||||||||||||||||||
Intercompany receivables, net | — | 571 | 708 | (1,279 | ) | — | — | |||||||||||||||||||
Other current assets | — | — | 532 | (8 | ) | — | 524 | |||||||||||||||||||
Accounts payable and other accrued expenses | — | — | 3,418 | 174 | — | 3,592 | ||||||||||||||||||||
Net cash provided by operating activities | — | 571 | 18,909 | 1,342 | — | 20,822 | ||||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Additions to property and equipment | — | — | (6,864 | ) | (1,355 | ) | — | (8,219 | ) | |||||||||||||||||
Other | — | — | (101 | ) | 293 | — | 192 | |||||||||||||||||||
Net cash used in investing activities | — | — | (6,965 | ) | (1,062 | ) | — | (8,027 | ) | |||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Principal payments of notes payable and capital lease obligations | — | (566 | ) | (1,334 | ) | (181 | ) | — | (2,081 | ) | ||||||||||||||||
Other | — | (5 | ) | 8 | 148 | — | 151 | |||||||||||||||||||
Net cash used in financing activities | — | (571 | ) | (1,326 | ) | (33 | ) | — | (1,930 | ) | ||||||||||||||||
INCREASE IN CASH AND CASH EQUIVALENTS | — | — | 10,618 | 247 | — | 10,865 | ||||||||||||||||||||
Cash, beginning of period | — | — | 25,820 | 4,592 | — | 30,412 | ||||||||||||||||||||
Cash, end of period | $ | — | $ | — | $ | 36,438 | $ | 4,839 | $ | — | $ | 41,277 | ||||||||||||||
F-46
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Table of Contents
II-2
Table of Contents
Item 21. | Exhibits |
*2 | .1 | Agreement and Plan of Merger, dated as of June 29, 2001, by and among InSight Health Services Holdings Corp. (“Holdings”), JWCH Merger Corp. and InSight Health Services Corp. (“InSight”), previously filed and incorporated herein by reference from InSight’s Current Report on Form 8-K, filed on July 2, 2001. | ||
*2 | .2 | Amendment No. 1 to Agreement and Plan of Merger, dated as of June 29, 2001, by and among Holdings, JWCH Merger Corp. and InSight, previously filed and incorporated by reference from InSight’s Annual Report on Form 10-K, filed on September 14, 2001. | ||
*2 | .3 | Amendment No. 2 to Agreement and Plan of Merger, dated as of October 9, 2001, by and among Holdings, InSight Health Services Acquisition Corp. and InSight, previously filed and incorporated herein by reference from InSight’s Current Report on Form 8-K, filed on October 9, 2001. | ||
*2 | .4 | Asset Purchase Agreement, dated January 6, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .5 | Amendment No. 1 to Asset Purchase Agreement, dated February 21, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .6 | Amendment No. 2 to Asset Purchase Agreement, dated March 31, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .7 | Asset Purchase Agreement, dated June 19, 2003, by and among InSight Health Corp., CDL Medical Technologies, Inc., Keith E. Loiselle and David J. Simile, previously filed and incorporated by reference from Holdings’ Current Report on Form 8-K, filed on August 11, 2003. | ||
*2 | .8 | Stock Purchase Agreement dated February 13, 2004, by and among InSight Health Corp., Comprehensive Medical Imaging, Inc., Cardinal Health 414, Inc. and Cardinal Health, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 8, 2004. | ||
*2 | .9 | Amendment No. 1 to Stock Purchase Agreement dated April 1, 2004, by and among InSight Health Corp., Comprehensive Medical Imaging, Inc., Cardinal Health 414, Inc. and Cardinal Health, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 8, 2004. | ||
*3 | .1 | Certificate of Incorporation of Holdings, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .2 | Bylaws of Holdings, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .3 | Certificate of Incorporation of InSight, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .4 | Bylaws of InSight, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .5 | Certificate of Incorporation of InSight Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .6 | Bylaws of InSight Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .7 | Certificate of Incorporation of Signal Medical Services, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .8 | Bylaws of Signal Medical Services, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. |
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*3 | .9 | Certificate of Incorporation of Open MRI, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .10 | Bylaws of Open MRI, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .11 | Certificate of Incorporation of Maxum Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .12 | Bylaws of Maxum Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .13 | Certificate of Incorporation of Radiosurgery Centers, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .14 | Bylaws of Radiosurgery Centers, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .15 | Certificate of Incorporation of Maxum Health Services Corp., as amended, previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .16 | Bylaws of Maxum Health Services Corp., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .17 | Certificate of Limited Partnership of MRI Associates, L.P., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .18 | Agreement of Limited Partnership of MRI Associates, L.P., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .19 | Certificate of Incorporation of Maxum Health Services of North Texas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .20 | Bylaws of Maxum Health Services of North Texas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .21 | Certificate of Incorporation of Maxum Health Services of Dallas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .22 | Bylaws of Maxum Health Services of Dallas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .23 | Certificate of Incorporation of NDDC, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .24 | Bylaws of NDDC, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .25 | Certificate of Incorporation of Diagnostic Solutions Corp., as amended, previously filed and incorporated herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .26 | Bylaws of Diagnostic Solutions Corp., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .27 | Certificate of Organization of Wilkes-Barre Imaging, L.L.C., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4/A, filed on March 25, 2002. | ||
*3 | .28 | Operating Agreement of Wilkes-Barre Imaging, L.L.C., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4/A, filed on March 25, 2002. | ||
*3 | .29 | Certificate of Organization of Orange County Regional PET Center-Irvine, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .30 | Operating Agreement of Orange County Regional PET Center-Irvine, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .31 | Certificate of Organization of San Fernando Valley Regional PET Center, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .32 | Operating Agreement of San Fernando Valley Regional PET Center, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .33 | Certificate of Organization of Valencia MRI, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .34 | Operating Agreement of Valencia MRI, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .35 | Certificate of Organization of Parkway Imaging Center, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .36 | Operating Agreement of Parkway Imaging Center, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .37 | Certificate of Incorporation of InSight Imaging Services Corp., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .38 | Bylaws of InSight Imaging Services Corp., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .39 | Certificate of Incorporation of Comprehensive Medical Imaging, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .40 | Bylaws of Comprehensive Medical Imaging, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .41 | Certificate of Incorporation of Comprehensive Medical Imaging Centers, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .42 | Bylaws of Comprehensive Medical Imaging Centers, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .43 | Certificate of Incorporation of Comprehensive Medical Imaging-Biltmore, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .44 | Bylaws of Comprehensive Medical Imaging-Biltmore, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .45 | Certificate of Incorporation of Comprehensive OPEN MRI-East Mesa, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .46 | Bylaws of Comprehensive OPEN MRI-East Mesa, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .47 | Articles of Incorporation of TME Arizona, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .48 | Bylaws of TME. Arizona, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .49 | Certificate of Incorporation of Comprehensive Medical Imaging-Fremont, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .50 | Bylaws of Comprehensive Medical Imaging-Fremont, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .51 | Certificate of Incorporation of Comprehensive Medical Imaging-San Francisco, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .52 | Bylaws of Comprehensive Medical Imaging-San Francisco, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .53 | Certificate of Incorporation of Comprehensive OPEN MRI-Garland, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .54 | Bylaws of Comprehensive OPEN MRI-Garland, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .55 | Certificate of Incorporation of IMI of Arlington, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .56 | Bylaws of IMI of Arlington, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .57 | Certificate of Incorporation of Comprehensive Medical Imaging-Fairfax, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .58 | Bylaws of Comprehensive Medical Imaging-Fairfax, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .59 | Certificate of Incorporation of IMI of Kansas City, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .60 | Bylaws of IMI of Kansas City, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .61 | Certificate of Incorporation of Comprehensive Medical Imaging-Bakersfield, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .62 | Bylaws of Comprehensive Medical Imaging-Bakersfield, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .63 | Articles of Organization of Comprehensive OPEN MRI-Carmichael/Folsom, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .64 | Operating Agreement of Comprehensive OPEN MRI-Carmichael/Folsom, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .65 | Articles of Organization of Syncor Diagnostics Sacramento, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .66 | Operating Agreement of Syncor Diagnostics Sacramento, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .67 | Articles of Organization of Syncor Diagnostics Bakersfield, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .68 | Operating Agreement of Syncor Diagnostics Bakersfield, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .69 | Articles of Organization of Phoenix Regional PET Center-Thunderbird, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .70 | Operating Agreement of Phoenix Regional PET Center-Thunderbird, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .71 | Joint Venture Agreement of Mesa MRI, dated as of December 20, 1991, by and between TME Partners III, Ltd. and TME, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .72 | Joint Venture Agreement of Mountain View MRI, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .73 | Joint Venture Agreement of Los Gatos Imaging Center, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .74 | Joint Venture Agreement of Woodbridge MRI, as amended by First Amendment thereto, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .75 | Joint Venture Agreement of Jefferson MRI-Bala, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .76 | Joint Venture Agreement of Jefferson MRI, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .77 | Amendment Number One to Joint Venture Agreement of Los Gatos Imaging Center, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .78 | Second Amendment to Joint Venture Agreement of Woodbridge MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .79 | First Amendment to Bylaws of Maxum Health Services Corp., previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .80 | Amendment Number One to Joint Venture Agreement of Mountain View MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .81 | Amendment Number One to Joint Venture Agreement of Mesa MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .82 | Amendment Number One to Joint Venture Agreement of Jefferson MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .83 | Amendment Number One to Joint Venture Agreement of Jefferson MRI-Bala, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .1 | Indenture, dated October 30, 2001, with State Street Bank and Trust Company, N.A., as Trustee, with respect to 97/8% Senior Subordinated Notes due 2011, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*4 | .2 | Supplemental Indenture, dated February 25, 2002, with respect to adding an additional Subsidiary Guarantor (named therein), previously filed and incorporated herein by reference from InSight’s Amendment No. 1 to Registration Statement on Form S-4, filed on March 25, 2002. | ||
*4 | .3 | Supplemental Indenture, dated April 2, 2003, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 26, 2003. | ||
*4 | .4 | Third Supplemental Indenture, dated as of March 8, 2004, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Quarterly Report on Form 10-Q, filed on May 13, 2004. | ||
*4 | .5 | Fourth Supplemental Indenture, dated as of June 8, 2004, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 24, 2004. | ||
*4 | .6 | Indenture, dated September 22, 2005, with U.S. Bank National Association, as Trustee, with respect to Senior Secured Floating Rate Notes due 2011, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .7 | Security Agreement, dated September 22, 2005, by and among the Loan Parties (as defined therein) and U.S. Bank National Association, as Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .8 | Pledge Agreement, dated September 22, 2005, by and among the Loan Parties (as defined therein) and U.S. Bank National Association, as Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .9 | Collateral Agency Agreement, dated September 22, 2005, among the Loan Parties (as defined therein) and U.S. Bank National Association, as Trustee and Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .10 | Registration Rights Agreement, dated September 22, 2005, by and among InSight, Holdings, the Subsidiary Guarantors (named therein) and Banc of America Securities LLC and CIBC World Market Corp. with respect to $300 million of Senior Secured Floating Rate Notes due 2011, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*5 | .1 | Opinion of Kaye Scholer LLP, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*10 | .1 | Amended and Restated Loan and Security Agreement, dated September 22, 2005, by and among InSight, and its subsidiaries listed therein and Bank of America, N.A. as Lender, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*10 | .2 | Holdings 2001 Stock Option Plan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. |
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*10 | .3 | Holdings 2001 Stock Option Plan Stock Option Agreement, dated June 29, 2001, by and between Holdings and Steven T. Plochocki, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .4 | Holdings 2001 Stock Option Plan Stock Option Agreement, dated June 29, 2001, by and between Holdings and Michael A. Boylan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .5 | Executive Employment Agreement, dated July 1, 2005, among InSight, Holdings and Bret W. Jorgensen, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on July 8, 2005. | ||
*10 | .6 | Executive Employment Agreement, dated June 29, 2001, between InSight and Steven T. Plochocki, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .7 | First Amendment to Executive Employment Agreement, dated September 4, 2003, by and between InSight and Steven T. Plochocki, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*10 | .8 | Executive Employment Agreement, dated October 22, 2004, among InSight, Holdings and Patricia R. Blank, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on January 26, 2005. | ||
*10 | .9 | Executive Employment Agreement, dated June 29, 2001, between InSight and Michael A. Boylan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .10 | Executive Employment Agreement, dated January 10, 2005, among InSight, Holdings and Mitch C. Hill, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on January 14, 2005. | ||
*10 | .11 | Executive Employment Agreement, dated August 10, 2005, among InSight, Holdings and Louis E. Hallman, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on August 15, 2005. | ||
*10 | .12 | Executive Employment Agreement, dated August 10, 2005, among InSight, Holdings and Donald F. Hankus, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on September 30, 2005. | ||
*10 | .13 | Executive Employment Agreement, dated December 27, 2001, between InSight and Marilyn U. MacNiven-Young, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .14 | Form of Holdings Performance Based Option Agreement, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .15 | Form of Amended and Restated Indemnification Agreement, previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 22, 2005. | ||
*10 | .16 | Fourth Amended and Restated Stockholders Agreement, dated as of July 1, 2005, among the Company, the JWC Holders (as defined therein), the Halifax Holders (as defined therein), the Management Holders (as defined therein) and the Additional Holders (as defined therein), previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on July 8, 2005. | ||
*10 | .17 | Management Agreement, dated as of October 17, 2001, by and among J.W. Childs Advisors II, L.P., Halifax Genpar, L.P., Holdings and InSight, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .18 | Resignation Agreement dated August 9, 2004, by and among InSight, Holdings and Steven T. Plochocki, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-4, filed on November 3, 2004. | ||
*10 | .19 | Stock Option Agreement, dated August 12, 2004, by and between Holdings and Michael N. Cannizzaro, previously filed and incorporated by reference from Holdings Quarterly Report on Form 10-Q, filed on November 10, 2004. | ||
*10 | .20 | Stock Option Agreement, dated April 8, 2005, by and between Holdings Company and Michael N. Cannizzaro, previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 22, 2005. | ||
12 | .1 | Ratio of Earnings to Fixed Charges, filed herewith. |
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*21 | .1 | Subsidiaries of Holdings, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
23 | .1 | Consent of PricewaterhouseCoopers LLP, filed herewith. | ||
*23 | .2 | Consent of Kaye Scholer LLP, included with Exhibit 5.1. | ||
*25 | .1 | Statement of Eligibility on Form T-1 of the Trustee under the Indenture dated September 22, 2005, between InSight and U.S. Bank National Association, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*99 | .1 | Form of Letter of Transmittal, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*99 | .2 | Form of Notice of Guaranteed Delivery, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. |
* | Previously filed |
Item 22. | Undertakings. |
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
(a) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; | |
(b) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; | |
(c) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. | |
(d) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. | |
(e) The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. |
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(f) The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. |
(2) That, for the purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. | |
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
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INSIGHT HEALTH SERVICES CORP. | |
INSIGHT HEALTH SERVICES HOLDINGS CORP. |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer of each of the foregoing entities |
SIGNATURE | ||||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and Director (principal executive officer) of each of the foregoing entities | |||||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer (principal financial and accounting officer) of each of the foregoing entities | |||||
/s/Michael N. Cannizzaro | Chairman of the Board and Director of each of the foregoing entities | |||||
/s/Kenneth M. Doyle | Director of each of the foregoing entities | |||||
/s/David W. Dupree | Director of each of the foregoing entities | |||||
/s/Steven G. Segal | Director of each of the foregoing entities | |||||
/s/Mark J. Tricolli | Director of each of the foregoing entities | |||||
/s/Edward D. Yun | Director of each of the foregoing entities |
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INSIGHT HEALTH CORP. | |
SIGNAL MEDICAL SERVICES, INC. | |
OPEN MRI, INC. | |
MAXUM HEALTH CORP. | |
RADIOSURGERY CENTERS, INC. | |
MAXUM HEALTH SERVICES CORP. | |
MAXUM HEALTH SERVICES OF NORTH TEXAS, INC. | |
MAXUM HEALTH SERVICES OF DALLAS, INC. | |
NDDC, INC. | |
DIAGNOSTIC SOLUTIONS CORP. | |
INSIGHT IMAGING SERVICES CORP. | |
COMPREHENSIVE MEDICAL IMAGING, INC. | |
COMPREHENSIVE MEDICAL IMAGING CENTERS, INC. | |
COMPREHENSIVE MEDICAL IMAGING- BILTMORE, INC. | |
COMPREHENSIVE OPEN MRI-EAST MESA, INC. | |
TME ARIZONA, INC. | |
COMPREHENSIVE MEDICAL IMAGING-FREMONT, INC. | |
COMPREHENSIVE MEDICAL IMAGING-SAN FRANCISCO, INC. | |
COMPREHENSIVE OPEN MRI-GARLAND, INC. | |
IMI OF ARLINGTON, INC. | |
COMPREHENSIVE MEDICAL IMAGING-FAIRFAX, INC. | |
IMI OF KANSAS CITY, INC. | |
COMPREHENSIVE MEDICAL IMAGING- | |
BAKERSFIELD, INC. |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer of each of the foregoing entities |
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SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director (principal executive officer) of each the foregoing entities | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer (principal financial and accounting officer) of each the foregoing entities |
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MRI ASSOCIATES, L.P. | |
By: InSight Health Corp., its general partner |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer |
SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director of InSight Health Corp., its general partner (principal executive officer) | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer of InSight Health Corp., its general partner (principal financial and accounting officer) |
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WILKES-BARRE IMAGING, L.L.C. |
By: | InSight Health Corp., its sole member and manager | |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer |
SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director of InSight Health Corp., its sole member and sole manager (principal executive officer) | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer of InSight Health Corp., its sole member and sole manager (principal financial and accounting officer) |
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ORANGE COUNTY REGIONAL PET CENTER — IRVINE, LLC | |
SAN FERNANDO VALLEY REGIONAL PET CENTER, LLC | |
VALENCIA MRI, LLC | |
By: InSight Health Corp., its sole member |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer |
SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director of InSight Health Corp., its sole member (principal executive officer) | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer of InSight Health Corp., its sole member (principal financial and accounting officer) |
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PARKWAY IMAGING CENTER, LLC |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | Manager |
SIGNATURE | ||||
/s/Bret W. Jorgensen | Manager (principal executive officer) | |||
/s/Mitch C. Hill | Manager (principal financial and accounting officer) |
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COMPREHENSIVE OPEN MRI- CARMICHAEL/ FOLSOM, LLC | |
SYNCOR DIAGNOSTICS SACRAMENTO, LLC | |
SYNCOR DIAGNOSTICS BAKERSFIELD, LLC | |
MESA MRI | |
MOUNTAIN VIEW MRI | |
LOS GATOS IMAGING CENTER | |
WOODBRIDGE MRI | |
JEFFERSON MRI-BALA | |
JEFFERSON MRI |
By: | Comprehensive Medical Imaging, Inc. and Comprehensive Medical Imaging Centers, Inc., its members | |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer |
SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director of Comprehensive Medical Imaging, Inc. and Comprehensive Medical Imaging Centers, Inc., its members (principal executive officer) | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer of Comprehensive Medical Imaging, Inc. and Comprehensive Medical Imaging Centers, Inc., its members (principal financial and accounting officer) |
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PHOENIX REGIONAL PET CENTER- THUNDERBIRD, LLC |
By: | Comprehensive Medical Imaging Centers, Inc., its sole member | |
By: | /s/Bret W. Jorgensen |
Name: Bret W. Jorgensen |
Title: | President and Chief Executive Officer |
SIGNATURE | ||||
/s/Bret W. Jorgensen | President and Chief Executive Officer and sole Director of Comprehensive Medical Imaging Centers, Inc., its sole member (principal executive officer) | |||
/s/Mitch C. Hill | Executive Vice President and Chief Financial Officer of Comprehensive Medical Imaging Centers, Inc., its sole member (principal financial and accounting officer) |
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*2 | .1 | Agreement and Plan of Merger, dated as of June 29, 2001, by and among InSight Health Services Holdings Corp. (“Holdings”), JWCH Merger Corp. and InSight Health Services Corp. (“InSight”), previously filed and incorporated herein by reference from InSight’s Current Report on Form 8-K, filed on July 2, 2001. | ||
*2 | .2 | Amendment No. 1 to Agreement and Plan of Merger, dated as of June 29, 2001, by and among Holdings, JWCH Merger Corp. and InSight, previously filed and incorporated by reference from InSight’s Annual Report on Form 10-K, filed on September 14, 2001. | ||
*2 | .3 | Amendment No. 2 to Agreement and Plan of Merger, dated as of October 9, 2001, by and among Holdings, InSight Health Services Acquisition Corp. and InSight, previously filed and incorporated herein by reference from InSight’s Current Report on Form 8-K, filed on October 9, 2001. | ||
*2 | .4 | Asset Purchase Agreement, dated January 6, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .5 | Amendment No. 1 to Asset Purchase Agreement, dated February 21, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .6 | Amendment No. 2 to Asset Purchase Agreement, dated March 31, 2003, by and among InSight Health Corp., Comprehensive Medical Imaging Centers, Inc., Comprehensive Medical Imaging, Inc. and Cardinal Health 414, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 16, 2003. | ||
*2 | .7 | Asset Purchase Agreement, dated June 19, 2003, by and among InSight Health Corp., CDL Medical Technologies, Inc., Keith E. Loiselle and David J. Simile, previously filed and incorporated by reference from Holdings’ Current Report on Form 8-K, filed on August 11, 2003. | ||
*2 | .8 | Stock Purchase Agreement dated February 13, 2004, by and among InSight Health Corp., Comprehensive Medical Imaging, Inc., Cardinal Health 414, Inc. and Cardinal Health, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 8, 2004. | ||
*2 | .9 | Amendment No. 1 to Stock Purchase Agreement dated April 1, 2004, by and among InSight Health Corp., Comprehensive Medical Imaging, Inc., Cardinal Health 414, Inc. and Cardinal Health, Inc., previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on April 8, 2004. | ||
*3 | .1 | Certificate of Incorporation of Holdings, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .2 | Bylaws of Holdings, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .3 | Certificate of Incorporation of InSight, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .4 | Bylaws of InSight, as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .5 | Certificate of Incorporation of InSight Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .6 | Bylaws of InSight Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .7 | Certificate of Incorporation of Signal Medical Services, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .8 | Bylaws of Signal Medical Services, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. |
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*3 | .9 | Certificate of Incorporation of Open MRI, Inc., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .10 | Bylaws of Open MRI, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .11 | Certificate of Incorporation of Maxum Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .12 | Bylaws of Maxum Health Corp., as amended, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .13 | Certificate of Incorporation of Radiosurgery Centers, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .14 | Bylaws of Radiosurgery Centers, Inc., previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .15 | Certificate of Incorporation of Maxum Health Services Corp., as amended, previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .16 | Bylaws of Maxum Health Services Corp., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .17 | Certificate of Limited Partnership of MRI Associates, L.P., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .18 | Agreement of Limited Partnership of MRI Associates, L.P., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .19 | Certificate of Incorporation of Maxum Health Services of North Texas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .20 | Bylaws of Maxum Health Services of North Texas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .21 | Certificate of Incorporation of Maxum Health Services of Dallas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .22 | Bylaws of Maxum Health Services of Dallas, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .23 | Certificate of Incorporation of NDDC, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .24 | Bylaws of NDDC, Inc., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .25 | Certificate of Incorporation of Diagnostic Solutions Corp., as amended, previously filed and incorporated herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .26 | Bylaws of Diagnostic Solutions Corp., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*3 | .27 | Certificate of Organization of Wilkes-Barre Imaging, L.L.C., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4/A, filed on March 25, 2002. | ||
*3 | .28 | Operating Agreement of Wilkes-Barre Imaging, L.L.C., previously filed and incorporated by reference herein from InSight’s Registration Statement on Form S-4/A, filed on March 25, 2002. | ||
*3 | .29 | Certificate of Organization of Orange County Regional PET Center-Irvine, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .30 | Operating Agreement of Orange County Regional PET Center-Irvine, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .31 | Certificate of Organization of San Fernando Valley Regional PET Center, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .32 | Operating Agreement of San Fernando Valley Regional PET Center, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .33 | Certificate of Organization of Valencia MRI, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .34 | Operating Agreement of Valencia MRI, LLC, as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .35 | Certificate of Organization of Parkway Imaging Center, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .36 | Operating Agreement of Parkway Imaging Center, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .37 | Certificate of Incorporation of InSight Imaging Services Corp., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .38 | Bylaws of InSight Imaging Services Corp., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .39 | Certificate of Incorporation of Comprehensive Medical Imaging, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .40 | Bylaws of Comprehensive Medical Imaging, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .41 | Certificate of Incorporation of Comprehensive Medical Imaging Centers, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .42 | Bylaws of Comprehensive Medical Imaging Centers, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .43 | Certificate of Incorporation of Comprehensive Medical Imaging-Biltmore, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .44 | Bylaws of Comprehensive Medical Imaging-Biltmore, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .45 | Certificate of Incorporation of Comprehensive OPEN MRI-East Mesa, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .46 | Bylaws of Comprehensive OPEN MRI-East Mesa, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .47 | Articles of Incorporation of TME Arizona, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .48 | Bylaws of TME. Arizona, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .49 | Certificate of Incorporation of Comprehensive Medical Imaging-Fremont, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .50 | Bylaws of Comprehensive Medical Imaging-Fremont, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .51 | Certificate of Incorporation of Comprehensive Medical Imaging-San Francisco, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .52 | Bylaws of Comprehensive Medical Imaging-San Francisco, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .53 | Certificate of Incorporation of Comprehensive OPEN MRI-Garland, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .54 | Bylaws of Comprehensive OPEN MRI-Garland, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .55 | Certificate of Incorporation of IMI of Arlington, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .56 | Bylaws of IMI of Arlington, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .57 | Certificate of Incorporation of Comprehensive Medical Imaging-Fairfax, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .58 | Bylaws of Comprehensive Medical Imaging-Fairfax, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .59 | Certificate of Incorporation of IMI of Kansas City, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .60 | Bylaws of IMI of Kansas City, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .61 | Certificate of Incorporation of Comprehensive Medical Imaging-Bakersfield, Inc., as amended, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .62 | Bylaws of Comprehensive Medical Imaging-Bakersfield, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .63 | Articles of Organization of Comprehensive OPEN MRI-Carmichael/Folsom, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .64 | Operating Agreement of Comprehensive OPEN MRI-Carmichael/Folsom, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .65 | Articles of Organization of Syncor Diagnostics Sacramento, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .66 | Operating Agreement of Syncor Diagnostics Sacramento, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .67 | Articles of Organization of Syncor Diagnostics Bakersfield, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .68 | Operating Agreement of Syncor Diagnostics Bakersfield, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .69 | Articles of Organization of Phoenix Regional PET Center-Thunderbird, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .70 | Operating Agreement of Phoenix Regional PET Center-Thunderbird, LLC, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .71 | Joint Venture Agreement of Mesa MRI, dated as of December 20, 1991, by and between TME Partners III, Ltd. and TME, Inc., previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .72 | Joint Venture Agreement of Mountain View MRI, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .73 | Joint Venture Agreement of Los Gatos Imaging Center, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .74 | Joint Venture Agreement of Woodbridge MRI, as amended by First Amendment thereto, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .75 | Joint Venture Agreement of Jefferson MRI-Bala, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*3 | .76 | Joint Venture Agreement of Jefferson MRI, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. |
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*3 | .77 | Amendment Number One to Joint Venture Agreement of Los Gatos Imaging Center, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .78 | Second Amendment to Joint Venture Agreement of Woodbridge MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .79 | First Amendment to Bylaws of Maxum Health Services Corp., previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .80 | Amendment Number One to Joint Venture Agreement of Mountain View MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .81 | Amendment Number One to Joint Venture Agreement of Mesa MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .82 | Amendment Number One to Joint Venture Agreement of Jefferson MRI, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*3 | .83 | Amendment Number One to Joint Venture Agreement of Jefferson MRI-Bala, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .1 | Indenture, dated October 30, 2001, with State Street Bank and Trust Company, N.A., as Trustee, with respect to 97/8% Senior Subordinated Notes due 2011, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*4 | .2 | Supplemental Indenture, dated February 25, 2002, with respect to adding an additional Subsidiary Guarantor (named therein), previously filed and incorporated herein by reference from InSight’s Amendment No. 1 to Registration Statement on Form S-4, filed on March 25, 2002. | ||
*4 | .3 | Supplemental Indenture, dated April 2, 2003, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 26, 2003. | ||
*4 | .4 | Third Supplemental Indenture, dated as of March 8, 2004, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Quarterly Report on Form 10-Q, filed on May 13, 2004. | ||
*4 | .5 | Fourth Supplemental Indenture, dated as of June 8, 2004, with respect to adding additional Subsidiary Guarantors (named therein), previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 24, 2004. | ||
*4 | .6 | Indenture, dated September 22, 2005, with U.S. Bank National Association, as Trustee, with respect to Senior Secured Floating Rate Notes due 2011, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .7 | Security Agreement, dated September 22, 2005, by and among the Loan Parties (as defined therein) and U.S. Bank National Association, as Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .8 | Pledge Agreement, dated September 22, 2005, by and among the Loan Parties (as defined therein) and U.S. Bank National Association, as Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .9 | Collateral Agency Agreement, dated September 22, 2005, among the Loan Parties (as defined therein) and U.S. Bank National Association, as Trustee and Collateral Agent, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*4 | .10 | Registration Rights Agreement, dated September 22, 2005, by and among InSight, Holdings, the Subsidiary Guarantors (named therein) and Banc of America Securities LLC and CIBC World Market Corp. with respect to $300 million of Senior Secured Floating Rate Notes due 2011, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*5 | .1 | Opinion of Kaye Scholer LLP, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*10 | .1 | Amended and Restated Loan and Security Agreement, dated September 22, 2005, by and among InSight, and its subsidiaries listed therein and Bank of America, N.A. as Lender, filed herewith. | ||
*10 | .2 | Holdings 2001 Stock Option Plan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .3 | Holdings 2001 Stock Option Plan Stock Option Agreement, dated June 29, 2001, by and between Holdings and Steven T. Plochocki, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. |
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*10 | .4 | Holdings 2001 Stock Option Plan Stock Option Agreement, dated June 29, 2001, by and between Holdings and Michael A. Boylan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .5 | Executive Employment Agreement, dated July 1, 2005, among InSight, Holdings and Bret W. Jorgensen, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on July 8, 2005. | ||
*10 | .6 | Executive Employment Agreement, dated June 29, 2001, between InSight and Steven T. Plochocki, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .7 | First Amendment to Executive Employment Agreement, dated September 4, 2003, by and between InSight and Steven T. Plochocki, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-1, filed on June 23, 2004. | ||
*10 | .8 | Executive Employment Agreement, dated October 22, 2004, among InSight, Holdings and Patricia R. Blank, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on January 26, 2005. | ||
*10 | .9 | Executive Employment Agreement, dated June 29, 2001, between InSight and Michael A. Boylan, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .10 | Executive Employment Agreement, dated January 10, 2005, among InSight, Holdings and Mitch C. Hill, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on January 14, 2005. | ||
*10 | .11 | Executive Employment Agreement, dated August 10, 2005, among InSight, Holdings and Louis E. Hallman, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on August 15, 2005. | ||
*10 | .12 | Executive Employment Agreement, dated August 10, 2005, among InSight, Holdings and Donald F. Hankus, previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on September 30, 2005. | ||
*10 | .13 | Executive Employment Agreement, dated December 27, 2001, between InSight and Marilyn U. MacNiven-Young, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .14 | Form of Holdings Performance Based Option Agreement, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .15 | Form of Amended and Restated Indemnification Agreement, previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 22, 2005. | ||
*10 | .16 | Fourth Amended and Restated Stockholders Agreement, dated as of July 1, 2005, among the Company, the JWC Holders (as defined therein), the Halifax Holders (as defined therein), the Management Holders (as defined therein) and the Additional Holders (as defined therein), previously filed and incorporated herein by reference from Holdings’ Current Report on Form 8-K, filed on July 8, 2005. | ||
*10 | .17 | Management Agreement, dated as of October 17, 2001, by and among J.W. Childs Advisors II, L.P., Halifax Genpar, L.P., Holdings and InSight, previously filed and incorporated herein by reference from InSight’s Registration Statement on Form S-4, filed on December 27, 2001. | ||
*10 | .18 | Resignation Agreement dated August 9, 2004, by and among InSight, Holdings and Steven T. Plochocki, previously filed and incorporated by reference from Holdings’ Registration Statement on Form S-4, filed on November 3, 2004. | ||
*10 | .19 | Stock Option Agreement, dated August 12, 2004, by and between Holdings and Michael N. Cannizzaro, previously filed and incorporated by reference from Holdings Quarterly Report on Form 10-Q, filed on November 10, 2004. | ||
*10 | .20 | Stock Option Agreement, dated April 8, 2005, by and between Holdings Company and Michael N. Cannizzaro, previously filed and incorporated herein by reference from Holdings’ Annual Report on Form 10-K, filed on September 22, 2005. | ||
12 | .1 | Ratio of Earnings to Fixed Charges, filed herewith. | ||
*21 | .1 | Subsidiaries of Holdings, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
23 | .1 | Consent of PricewaterhouseCoopers LLP, filed herewith. |
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*23 | .2 | Consent of Kaye Scholer LLP, included with Exhibit 5.1. | ||
*25 | .1 | Statement of Eligibility on Form T-1 of the Trustee under the Indenture dated September 22, 2005, between InSight and U.S. Bank National Association, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*99 | .1 | Form of Letter of Transmittal, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. | ||
*99 | .2 | Form of Notice of Guaranteed Delivery, previously filed with InSight’s Registration Statement on Form S-4, filed on October 28, 2005. |
* | Previously filed |
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