SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 28, 1998
Commission File No. 0-3532
OLSTEN CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 13-2610512
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
175 Broad Hollow Road, Melville, New York 11747-8905
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (516) 844-7800
--------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at August 6, 1998
- ------------------------------------ -----------------------------
Common Stock, $.10 par value 68,022,910 shares
Class B Common Stock, $.10 par value 13,301,733 shares
INDEX
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Page No.
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - June 28, 1998 (Unaudited) and
December 28, 1997 2
Consolidated Statements of Income (Unaudited) - Quarters and Six
Months Ended June 28, 1998 and June 29, 1997, respectively 3
Consolidated Statements of Cash Flows (Unaudited) - Six Months
Ended June 28, 1998 and June 29, 1997, respectively 4
Notes to Consolidated Financial Statements (Unaudited) 5-6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 7-9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 4. Submission of Matters to a Vote of Security Holders 10-11
Item 5. Other Information 11-13
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Olsten Corporation
Consolidated Balance Sheets
(In thousands, except share amounts)
June 28, 1998 December 28, 1997
------------- -----------------
ASSETS (Unaudited)
CURRENT ASSETS:
Cash $ 18,366 $ 84,810
Receivables, net 918,803 847,419
Other current assets 92,214 90,715
--------- ---------
Total current assets 1,029,383 1,022,944
FIXED ASSETS, NET 197,457 186,347
INTANGIBLES, NET 575,343 534,284
OTHER ASSETS 9,556 6,626
--------- ---------
$1,811,739 $1,750,201
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accrued expenses $ 170,156 $ 152,239
Payroll and related taxes 100,675 86,071
Accounts payable 64,950 55,851
Insurance costs 35,939 41,270
--------- ---------
Total current liabilities 371,720 335,431
LONG-TERM DEBT 534,501 461,178
OTHER LIABILITIES 99,713 111,815
SHAREHOLDERS' EQUITY:
Common stock $.10 par value;
authorized 110,000,000 shares;
issued 68,020,850 and 68,151,708
shares, respectively 6,802 6,815
Class B common stock $.10 par value;
authorized 50,000,000 shares;
issued 13,303,790 and 13,157,617
shares, respectively 1,330 1,316
Additional paid-in capital 447,442 447,297
Retained earnings 358,744 390,786
Accumulated other comprehensive income (8,513) (4,437)
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Total shareholders' equity 805,805 841,777
--------- ---------
$1,811,739 $1,750,201
========= =========
See notes to consolidated financial statements.
Olsten Corporation
Consolidated Statements of Income
(In thousands, except share amounts)
(Unaudited)
Second Quarter Ended Six Months Ended
------------------------ ------------------------
June 28, June 29, June 28, June 29,
1998 1997 1998 1997
Service sales, franchise fees,
management fees and other income $1,126,142 $1,014,387 $2,176,084 $1,965,238
Cost of services sold 883,017 744,205 1,666,902 1,440,097
--------- --------- --------- ---------
Gross profit 243,125 270,182 509,182 525,141
Selling, general and administrative
expenses 286,591 221,756 523,451 440,727
Interest expense, net 7,476 5,201 13,382 9,349
--------- --------- --------- ---------
Income (loss) before income taxes and
minority interests (50,942) 43,225 (27,651) 75,065
Income tax charge (benefit) (19,740) 16,858 (10,714) 29,276
--------- --------- --------- ---------
Income (loss) before minority interests (31,202) 26,367 (16,937) 45,789
Minority interests 2,262 1,038 3,726 1,293
--------- --------- --------- ---------
Net income (loss) $ (33,464) $ 25,329 $ (20,663) $ 44,496
========= ========= ========= =========
SHARE INFORMATION:
Basic earnings (loss) per share:
Net income (loss) $ (.41) $ .31 $ (.25) $ .55
========= ========= ========= =========
Average shares outstanding 81,346 81,212 81,361 81,186
========= ========= ========= =========
Diluted earnings (loss) per share:
Net income (loss) (.41) .31 (.25) .55
========= ========= ========= =========
Average shares outstanding 81,346 83,127 81,361 83,070
========= ========= ========= =========
See notes to consolidated financial statements.
Olsten Corporation
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
------------------------------------
June 28, 1998 June 29, 1997
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OPERATING ACTIVITIES:
Net income (loss) $ (20,663) $ 44,496
Adjustments to reconcile net income
(loss)to net cash used in operating activities:
Depreciation and amortization 32,512 25,161
Changes in assets and liabilities,
net of effects from acquisitions and dispositions:
Accounts receivable and other current assets (70,907) (95,579)
Current liabilities 41,803 5,221
Other, net (8,775) 4,871
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NET CASH USED IN OPERATING ACTIVITIES (26,030) (15,830)
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INVESTING ACTIVITIES:
Acquisitions of businesses including franchises, net of
cash acquired (60,408) (106,492)
Purchases of fixed assets (35,146) (38,192)
Sale of investment securities -- 9,415
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NET CASH USED IN INVESTING ACTIVITIES (95,554) (135,269)
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FINANCING ACTIVITIES:
Net proceeds from issuance of notes 133,806 --
Net(repayments of) proceeds from line of credit agreements (60,862) 79,746
Cash dividends (11,378) (11,362)
Repayment of notes payable (6,202) --
Issuances of common stock under stock plans 54 681
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NET CASH PROVIDED BY FINANCING ACTIVITIES 55,418 69,065
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EFFECT OF EXCHANGE RATE CHANGES ON CASH (278) --
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NET DECREASE IN CASH (66,444) (82,034)
CASH AT BEGINNING OF PERIOD 84,810 105,725
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CASH AT END OF PERIOD $ 18,366 $ 23,691
======== =======
NON-CASH TRANSACTIONS:
Assets acquired through the issuance of a note $ -- $ 19,535
Issuance of restricted stock $ -- $ 6,437
See notes to consolidated financial statements.
Olsten Corporation
Notes to Consolidated Financial Statements
(Unaudited)
1. Accounting Policies
-------------------
The consolidated financial statements have been prepared by Olsten
Corporation (the "Company") pursuant to the rules and regulations of the
Securities and Exchange Commission and, in the opinion of management,
include all adjustments necessary for a fair presentation of results of
operations, financial position and cash flows for each period presented.
Results for interim periods are not necessarily indicative of results
for a full year. The year end balance sheet data was derived from
audited financial statements, but does not include all disclosures
required by generally accepted accounting principles.
2. Long-Term Debt
--------------
In May 1998, the Company's wholly-owned subsidiary, Olsten International
B.V. issued, in a public offering, 800 million French Franc
(approximately U.S. $133 million), 6 percent Euronotes due 2008, which
are fully guaranteed by the Company. The net proceeds were used to repay
existing indebtedness and for general financing purposes of the issuer
and its related companies.
On July 30, 1998, the Company's revolving credit agreement, dated August
9, 1996, was amended to revise the provision related to the maintenance
of various financial ratios and covenants.
Interest expense, net, consists primarily of interest on long-term debt
for the quarter of $8.4 million in 1998 and $5.9 million in 1997, offset
by interest income from investments of $949 thousand and $729 thousand
for 1998 and 1997, respectively. Interest expense for the six months
was $15.2 million, net of interest income of $1.8 million in 1998 and
$11.5 million, net of interest income of $2.2 million in 1997.
3. Acquisitions
------------
Under the terms of the 1997 purchase agreement for Sogica S.A., an
additional payment of approximately $31 million, related to their 1997
results of operations, was paid in the second quarter of 1998. An
additional purchase price payment will be required in the year 2000,
calculated based upon the average net income for the three fiscal years
ended December 31, 1999. The Company is obligated in the year 2000 to
purchase the remaining Sogica S.A. shares at a price to be determined by
a multiple ranging from an upper limit of 16 and a lower limit of 10,
applied to average net income for the two fiscal years ended 1998 and
1999.
During the first six months of 1998, the Company purchased various
businesses for $29 million in cash. Included in these acquisitions was
the purchase of a Danish company, Attention Personalservice A/S, several
small acquisitions in France and Sweden, as well as the acquisition in
Brazil of Top Services S.A. All acquisitions have been accounted for by
the purchase method of accounting.
4. Adjustments and One-Time Charges
--------------------------------
The results for the second quarter include adjustments and one-time
charges of $66 million ($40 million, net of tax) or $.50 per share,
related primarily to the restructuring of the Company's home health
business as follows:
* In response to new Medicare reimbursement methodology under the
Interim Payment System, the Company's office closings and
consolidations are causing it to record non-recurring charges and
adjustments to selling, general and administrative expenses of $37
million ($23 million, net of tax) relating to lease payments, employee
severance, professional fees and related costs, and an increase in the
allowance for doubtful accounts.
* In addition, the Company recorded a reduction in revenues of $14
million ($8 million, net of tax) in anticipation of lower Medicare
reimbursements resulting from the new per-visit and per-beneficiary
limits that have been imposed by Medicare under the Interim Payment
System.
* The Company also recorded a charge to cost of sales of $15 million ($9
million, net of tax) to reserve for costs associated with the
increased utilization of services under several of the Company's
capitated contracts with managed care customers.
5. Adoption of SFAS 130, "Reporting Comprehensive Income"
------------------------------------------------------
As of December 29, 1997, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income" ("SFAS
130"). SFAS 130 establishes new rules for the reporting and display of
comprehensive income and its components; however, the adoption of this
Statement had no impact on the Company's net income or shareholders'
equity. SFAS 130 requires unrealized gains or losses on the Company's
foreign currency translation adjustments, which prior to adoption were
reported separately in shareholders' equity, to be included in other
comprehensive income. Prior year financial statements have been
reclassified to conform to the requirements of SFAS 130.
During the second quarter and six months of 1998, total comprehensive
income (loss) amounted to $(36.5) million and $(24.7) million,
respectively, and $27.9 million and $48.1 million for the same periods
in 1997.
6. Subsequent Event
----------------
In July 1998, the Board of Directors authorized the repurchase, at
management's discretion, of up to 4 million shares of the Company's $.10
par value common stock. To date, approximately 46 thousand shares have
been repurchased aggregating $455 thousand.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Results of Operations
- ---------------------
The results of operations for the second quarter include adjustments and
one-time charges of $66 million ($40 million, net of tax), or $.50 per share
related primarily to the restructuring of the Company's home health business as
follows:
* In response to new Medicare reimbursement methodology under the Interim
Payment System, the Company's office closings and consolidations are causing
it to record non-recurring charges and adjustments to selling, general and
administrative expenses of $37 million ($23 million, net of tax) relating to
lease payments, employee severance, professional fees and related costs, and
an increase in the allowance for doubtful accounts.
* In addition, the Company recorded a reduction in service sales of $14 million
($8 million, net of tax) in anticipation of lower Medicare reimbursements
resulting from the new per-visit and per-beneficiary limits that have been
imposed by Medicare under the Interim Payment System.
* The Company also recorded a charge to cost of services sold of $15 million ($9
million, net of tax) to reserve for costs associated with the increased
utilization of services under several of the Company's capitated contracts
with managed care customers.
Excluding the effect of these adjustments and one-time charges, net income for
the second quarter of 1998 decreased 73 percent to $6.9 million, or $.09 per
share, compared to $25.3 million, or $.31 per share for last year's second
quarter. Net income for the first six months was $19.8 million, or $.24 per
share, a 56 percent decrease, excluding the effect of these adjustments and
one-time charges, compared to $44.5 million, or $.55 per share, reported in
1997.
Revenues increased $112 million, or 11 percent, to $1.1 billion for the second
quarter, as compared to $1 billion for last year's second quarter. Revenues
increased $211 million, or 11 percent, to $2.2 billion for the first six months
of 1998, as compared to $2 billion for the comparable period of 1997.
Staffing Services reported increased revenues of 25 percent to $809 million for
the second quarter and 24 percent to $1.5 billion for the six months over last
year's second quarter and six month periods of $647 million and $1.2 billion,
respectively. Acquisitions accounted for approximately 13 percent of the second
quarter revenue growth, while European operations contributed 6 percent
reflecting industry growth and favorable economic conditions. The remaining 6
percent growth is primarily attributable to internal growth in North American
information technology and professional services operations, offset by a decline
in traditional services due to lower hourly volume.
Health Services' revenues declined 14 percent to $315 million for the second
quarter, and 11 percent to $647 million for the six months, compared to $365
million and $724 million for the same periods in 1997. The decline in Health
Services' revenues was due to decreases in both Medicare nursing visits and in
management fees generated by hospital-based home health agencies. The Medicare
Interim Payment System as indicated above, continued Federal Government focus on
the home care industry and the reluctance of physicians to refer patients to
home care have negatively impacted the Medicare segment of both businesses. An
overall increase in Network Services, Infusion Services and other Health
Services' business lines partly offset the above.
Cost of services sold increased $139 million, or 19 percent, to $883 million for
the second quarter and 16 percent to $1.7 billion for the six months of 1998,
from $744 million and $1.4 billion for the same periods in 1997 due primarily to
the growth in revenues and increased costs associated with the utilization of
services under several of the Company's capitated contracts. Gross profit
margins, as a percentage of revenues, decreased to 21.6 percent for the second
quarter and 23.4 percent for the six months from 26.6 percent for last year's
second quarter and 26.7 percent for last year's six months. Staffing Services'
gross profit margins increased primarily as a result of profit improvements in
Europe, with improved utilization and bill rates, particularly in Germany,
offset by a decline in the U.S. Information Technology division related to an
increased level of large contracts which are at lower margins. Health Services'
gross profit margins decreased due to the decline in Medicare and health
management volume, the Medicare Interim Payment System and increased costs
related to the servicing of capitated contracts.
Selling, general and administrative expenses increased $65 million and $83
million, or 29.2 percent and 18.8 percent, to $287 million and $528 million for
the second quarter and six months, from $222 million and $441 million for the
same periods in 1997. The increases in the quarter and six months result from
significant investments in new systems, infrastructure and the development of
professional services divisions. As a percentage of revenues, such expenses
increased to 25.5 percent from 21.9 percent for the quarter and increased to 24
percent from 22.4 percent for the six months.
Net interest expense was $7.5 million and $5.2 million for the second quarters
of 1998 and 1997, respectively, and $13.4 million and $9.3 million for the six
month periods of 1998 and 1997. Net interest primarily reflected borrowing costs
on long-term debt offset by interest income on investments. The increase
resulted from interest expense incurred as the Company continued to fund its
acquisition program, as well as the financing of accounts receivable.
Liquidity and Capital Resources
- -------------------------------
Working capital decreased from $688 million at December 28, 1997 to $658 million
at June 28, 1998. For the six month period, net cash decreased $66 million
primarily resulting from the $133 million in proceeds received from the issuance
of the 6 percent Euronotes by the Company's subsidiary, Olsten International
B.V., offset by a $155 million pay down of the line of credit agreement, the
acquisition of businesses and capital expenditures; and a $26 million decrease
in cash from operations. Accounts receivable and other current assets increased
$71 million for the six months. This increase is primarily attributed to revenue
growth, acquisitions, as well as consolidated billing requirements of large
corporate accounts in the Staffing Services division, coupled with revenue
growth of managed care and infusion therapy accounts, which impacted the timing
of the collection process.
The Company has a revolving credit agreement with a consortium of eleven banks
for up to $400 million in borrowings and letters of credit. As of June 28, 1998,
there were $115 million in borrowings outstanding and $47 million in standby
letters of credit. On July 30, 1998, the Company's revolving credit agreement,
dated August 9, 1996, was amended to revise the provisions related to the
maintenance of various financial ratios and covenants. The Company has invested
available funds in short-term, interest-bearing investments. The Company
believes that its levels of working capital, liquidity and available sources of
funds are sufficient to support present operations and to continue to fund
future growth and business opportunities as the Company increases its scope of
services.
OTHER
- -----
INFORMATION CONTAINED HEREIN, OTHER THAN HISTORICAL INFORMATION, SHOULD BE
CONSIDERED FORWARD-LOOKING AND IS SUBJECT TO VARIOUS RISK FACTORS AND
UNCERTAINTIES. FOR INSTANCE, THE COMPANY'S STRATEGIES AND OPERATIONS INVOLVE
RISKS OF COMPETITION, CHANGING MARKET CONDITIONS, CHANGES IN LAWS AND
REGULATIONS AFFECTING THE COMPANY'S INDUSTRIES AND NUMEROUS OTHER FACTORS
DISCUSSED IN THIS DOCUMENT AND IN OTHER COMPANY FILINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION. ACCORDINGLY, ACTUAL RESULTS MAY DIFFER MATERIALLY FROM
THOSE PROJECTED IN ANY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
------------------
By Order of the Magistrate Judge dated July 10, 1998, the United States District
Court for the Eastern District of New York adhered to its May 4, 1998 Order (a)
consolidating the four previously disclosed purported class action lawsuits
(Weichman, Goldman, Waldman and Cannold) pending against Olsten and certain of
its officers and directors (collectively, the "Class Action"), (b) appointing a
Lead Plaintiff and (c) selecting Plaintiffs' Lead Counsel. By Order entered on
July 27, 1998, the Court set a schedule for the filing of a Consolidated Amended
Complaint and the service and filing of papers in connection with defendants'
anticipated motion to dismiss such Complaint. While the Company is unable at
this time to assess the probable outcome of the Class Action or the materiality
of the risk of loss in connection therewith (given the preliminary stage of the
Class Action and the fact that the Consolidated Amended Complaint has not yet
been served), the Company believes that it acted responsibly with respect to its
shareholders and intends to vigorously defend the Class Action.
Item 4. Submission of Matters to a Vote of Security Holders.
----------------------------------------------------
(a) The Annual Meeting of Shareholders of the Company was held on
May 5, 1998.
(c) (i) At the Annual Meeting, shareholders elected directors of the
Company by votes as follows:
Name of Director Votes For Votes Withheld
---------------- ------------ --------------
Victor F. Ganzi 121,417,280 63,340
Stuart R. Levine 121,417,100 63,520
Frank N. Liguori 121,415,310 65,310
John M. May 55,890,018 1,378,040
Miriam Olsten 121,412,170 68,450
Stuart Olsten 121,416,120 64,500
Richard J. Sharoff 121,417,280 63,340
Raymond S. Troubh 55,784,100 1,483,958
Josh S. Weston 55,823,337 1,444,721
(ii) At the Annual Meeting, shareholders voted upon a proposal to
approve amendments to the Company's 1994 Stock Incentive Plan.
The votes were as follows:
Votes For Votes Against Abstentions Broker Non-Votes
----------- ------------- ----------- ----------------
170,088,311 8,396,491 245,371 18,505
(iii) At the Annual Meeting, shareholders voted upon a proposal to
approve an amendment to the Company's 1990 Non-Qualified Stock
Option Plan for Non-Employee Directors and Consultants. The
votes were as follows:
Votes For Votes Against Abstentions Broker Non-Votes
----------- ------------- ----------- ----------------
174,295,113 4,218,691 233,106 1,768
(iv) At the Annual Meeting, shareholders voted upon a proposal to
approve the Company's Stock & Deferred Compensation Plan for
Non-Employee Directors. The votes were as follows:
Votes For Votes Against Abstentions Broker Non-Votes
----------- ------------- ----------- ----------------
175,662,104 2,835,673 241,496 9,405
(v) At the Annual Meeting, shareholders voted upon a proposal to
ratify and approve the appointment by the Board of Directors of
Coopers & Lybrand L.L.P. as independent accountants for the
Company for its 1998 fiscal year. The votes were as follows:
Votes For Votes Against Abstentions Broker Non-Votes
----------- ------------- ----------- ----------------
178,083,925 563,112 99,911 1,730
Item 5. Other Information.
------------------
Government Investigations. The Company's home health care business is subject
to extensive federal and state regulations which govern, among other things,
Medicare, Medicaid, CHAMPUS and other government-funded reimbursement
programs, reporting requirements, certification and licensure standards for
certain home health agencies and, in some cases, certificate-of-need and
pharmacy-licensing requirements. The Company is also subject to a variety of
federal and state regulations which prohibit fraud and abuse in the delivery
of health care services, including, but not limited to, prohibitions against
the offering or making of direct or indirect payments for the referral of
patients. As part of the extensive federal and state regulation of the
Company's home health care business, the Company is subject to periodic
audits, examinations and investigations conducted by or at the direction of
governmental investigatory and oversight agencies. Violation of the applicable
federal and state regulations can result in a health care provider's being
excluded from participation in the Medicare, Medicaid and/or CHAMPUS programs,
and can subject the provider to civil and/or criminal penalties.
The Company continues to cooperate with the previously disclosed health care
industry investigations being conducted by certain governmental agencies
(collectively, the "Healthcare Investigations").
Among the Healthcare Investigations with which Olsten continues to cooperate
is that being conducted into the Company's preparation of Medicare cost
reports by the Office of Investigations section of the Office of Inspector
General (an agency within the U.S. Department of Health & Human Services) and
the U.S. Department of Justice.
The Company also continues to cooperate with the U.S. Department of Justice
and other federal agencies investigating the relationship between Columbia/HCA
Healthcare Corporation and Olsten in connection with the purchase, sale and
operation of certain home health agencies which are now owned by Columbia/HCA
and managed under contract by Olsten Health Management, a unit of Olsten
Health Services that provides management services to hospital-based home
health agencies.
Olsten continues to cooperate with various state and federal agencies,
including the U.S. Department of Justice, the Office of the Attorney General
of New Mexico and the New Mexico Health Care Anti-Fraud Task Force ("Task
Force"), in connection with their investigations into certain health care
practices of Quantum Health Resources ("Quantum"). Among the matters into
which those agencies are inquiring are allegations of improper billing and
fraud against various federally-funded medical assistance programs on the part
of Quantum and its post-acquisition successor, the Infusion Therapy Services
division of Olsten Health Services. Most of the time period which the Company
understands to be at issue in the Task Force investigation predates Olsten's
June 1996 acquisition of Quantum.
The Company believes that certain of the Healthcare Investigations may have
been triggered by or given rise to lawsuits under federal and/or state
whistleblower statutes against Olsten and/or Quantum.
Notwithstanding the Company's continuing cooperation with the Healthcare
Investigations, Olsten has been notified that it is a target of a federal
grand jury investigation by the U.S. Attorney's Office for the Southern
District of Florida, which investigation Olsten believes focuses upon the
Company's above-referenced relationship with Columbia/HCA in connection with
the purchase, sale and operation of certain home health agencies. In addition
to the U.S. Attorney's Office for the Southern District of Florida, other
agencies of the federal and/or state governments may regard the Company and/or
certain of its employees as subjects or targets of one or more of the other
Healthcare Investigations. An indictment of Olsten in connection with any one
of the Healthcare Investigations could result in the suspension of payments to
Olsten under the Medicare, Medicaid and/or CHAMPUS programs. If Olsten were to
be found to have violated any of the laws and regulations at issue in the
Healthcare Investigations, the Company could be subjected to a variety of
sanctions, including substantial monetary fines, civil and/or criminal
penalties and exclusion from participation in the Medicare, Medicaid and/or
CHAMPUS programs. While the Company is unable at this time to predict the
ultimate outcome of the Healthcare Investigations, the above-referenced
suspension of payments or the imposition of any one of the foregoing sanctions
could have a material adverse effect upon the Company's financial position and
results of operations.
Shareholder Proposals. As the Company indicated in its Proxy Statement dated
April 9, 1998 relating to its 1998 Annual Meeting of Shareholders, if a
shareholder intends to present a proposal at the Company's 1999 Annual Meeting
of Shareholders and desires that the proposal be included in the Company's
proxy statement and form of proxy for that meeting, the proposal must be
received by the Company by December 10, 1998. As to any proposal that a
shareholder intends to present at the 1999 Annual Meeting of Shareholders
without including such proposal in the Company's proxy statement relating to
its 1999 Annual Meeting of Shareholders, the proxies named in management's
proxy for that meeting will be entitled to exercise their discretionary
authority on that proposal unless the Company receives notice of the matter to
be proposed not later than February 23, 1999. Even if proper notice is
received on or before February 23, 1999, the proxies named in management's
proxy for that meeting may still exercise their discretionary authority as to
such matter by advising shareholders of such proposal and how they intend to
exercise their discretion to vote on such matter, unless the shareholder
making the proposal solicits proxies with respect to such proposal in
accordance with Rule 14a-4(c)(2) of the Securities Exchange Act of 1934.
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a) The following exhibits are filed herewith:
Exhibit 3 - By-Laws of the Company.
Exhibit 10.1 - Amendment No. 3, dated as of July 30, 1998, to
Credit Agreement, dated as of August 9, 1996, as
amended, among the Company, the Banks signatory
thereto and The Chase Manhattan Bank, as Agent,
covering $400 million credit facility.
Exhibit 10.2 - Fiscal Agency Agreement, dated May 6, 1998,
relating to French Franc 800,00,000 6% Notes due
2008 guaranteed by the Company.
Exhibit 27 - Financial Data Schedule.
(b) Reports on Form 8-K.
--------------------
(i) The Company filed a report on Form 8-K, dated March 30, 1998,
reporting in Item 5, Other Events, that the Company had
released a press release dated March 27, 1998, which was
filed as an Exhibit.
(ii) The Company filed a report on Form 8-K, dated April 24, 1998,
reporting in Item 5, Other Events, that the Company had
released a press release dated April 24, 1998, which was
filed as an Exhibit.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
OLSTEN CORPORATION
(REGISTRANT)
Date: August 12, 1998 /s/ Frank N. Liguori
--------------------
Frank N. Liguori
Chairman and Chief
Executive Officer
Date: August 12, 1998 /s/ Anthony J. Puglisi
----------------------
Anthony J. Puglisi
Executive Vice President and
Chief Financial Officer