UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 7, 2002
MONOGRAM PICTURES, INC.
(Exact name of registrant as specified in its charter)
Nevada 000-20598 75-2293489
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1375 South Fort Harrison Ave. Clearwater FL 33756
(Address of principal executive offices Zip Code)
Registrant's telephone number, including area code: 727 466-2302
NOT APPLICABLE
(Former name or former address, if changed since last report)
Item 1. Changes in Control of Registrant.
NOT APPLICABLE
Item 2. Acquisition or Disposition of Assets.
NOT APPLICABLE
Item 3. Bankruptcy or Receivership.
NOT APPLICABLE
Item 4. Changes in Registrant's Certifying Accountants.
(1) On March 7th 2002, Monogram dismissed its certifying public accountant,
Clancy and Co., P.L.L.C. That firm's report in on the Monogram's financial
statements for 1999 and 2000 contained a "going concern" qualification. The
"going concern" qualification was expressed in the audit report as NOTE 1".
The Company continues to actively seek merger targets. There is, of
course, no assurance that the Company will be successful in its
endeavors. The financial statements have been prepared on the basis
of
generally accepted accounting principles applicable to a going
concern,
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. Accordingly, they do
not
purport to give effect to adjustments, if any, that may be necessary
should the Company be unable to continue as a going concern. The
Company has incurred substantial net losses in recent years and used
substantial amounts of working capital in its operations. These
factors
raise substantial doubt about its ability to continue as a going
concern. The continuation of the Company as a going concern is
dependent upon the Company's ability to establish itself as a
profitable business. Management's plans to seek additional capital
include equity financing's and/or a merger with an existing
operating
company (s). It is the Company's belief that it will continue to
incur
losses for the next 12 months, and as a result, will require
additional
funds. There are no guarantees the Company will be successful in
obtaining these funds. The Company's ability to achieve these
objectives cannot be determined at this time. The financial
statements
do not include any adjustments that might result
from the outcome of these uncertainties.
The decision to dismiss Clancy and Co., P.L.L.C. was made by the Board of
Directors. Clancy and Co., P.L.L.C. desired to resign. Monogram's new
management wished to retain Pender Newkirk and Co. CPA's as its auditors both
for geographic reasons and Pender's recent accounting experience with
Monogram's pending acquisition of Med-Tech Laboratories, Inc. d/b/a/ Med
Services of America. To the knowledge of current management, there were no
disagreements with Clancy and Co., P.L.L.C. during the past two fiscal years
and the interim period since the end of the most recent fiscal year on any
matter of accounting principles or practices, financial statement disclosure,
or auditing scope of procedure. During the past two fiscal years and the
interim period since the end of the most recent fiscal year, to the knowledge
of current management, Clancy and Co., P.L.L.C. did not advise Monogram that
the internal controls necessary for Monogram to develop reliable financial
statements do not exist, that Clancy and Co., P.L.L.C. would no longer be
able to rely on management's representations, that it was unwilling to be
associated with the financial statements prepared by management that it
needed to expand significantly the scope of its audit, that information had
come to its attention that if further investigated may (i) materially impact
the fairness or reliability of either: a previously issued audit report or
the underlying financial statements; or the financial statements issued or to
be issued, that information had come to its attention that it has concluded
materially impacts the fairness or reliability of either (i) a previously
issued audit report or the underlying financial statements, or (ii) the
financial statements issued or to be issued covering the fiscal period(s)
subsequent to the date of the most recent financial statements covered by an
audit report (including information that, unless resolved to the accountant's
satisfaction, would prevent it from rendering an unqualified audit report on
those financial statements).
(2) On March 7th, 2002, Monogram engaged Pender Newkirk and Company of Tampa,
Florida as its independent public accountant to audit its financial
statements for the fiscal year ended 2001. Pender had been engaged as the
independent public auditor of Med-Tech Laboratories, Inc., a company to be
acquired by Monogram. During the two fiscal years ended 2000 and 2001 and
the interim period since the end of the last such fiscal year, Monogram has
not consulted Pender regarding the application of accounting principles to a
specified transaction, either completed or proposed; or the type of audit
opinion that might be rendered on Monogram's financial statements.
(3) Monogram is providing both Clancy and Co., P.L.L.C. and Pender with a
copy of this 8-K on the date it is being filed with the Commission with a
request to both firms that they furnish, as soon as promptly as possible,
Monogram with a letter addressed to the Commission stating whether they,
respectively, agree with the statements made in this report and, if not,
stating the respects in which they does not agree so that Monogram can file
the letters with the Commission within ten business days after the filing of
this report, but not later than two business days after receipt.
Item 5. Other Events and Regulation FD Disclosure.
NOT APPLICABLE
Item 6. Resignation of Registrant's Directors.
NOT APPLICABLE
Item 7. Financial Statements and Exhibits.
NOT APPLICABLE
Item 8. Change in Fiscal Year.
NOT APPLICABLE
Item 9. Item FD Disclosure.
For Immediate Release
Med Tech Labs, Inc. Introduces Its Strategic Plan
Announces Change in Auditors
Clearwater, Fla., March 14, 2002/PRNewswire/ -- Monogram Pictures, Inc.
(OTCBB: MOPP , http://www.monogrampicturesinc.com) sets forth a summarized
explanation of Med Tech Labs, Inc.'s strategic business plan. Monogram
Pictures, Inc. and Med Tech Labs, Inc. have entered into an agreement for
Monogram to acquire Med Tech Labs, Inc. The transaction will result in the
current shareholders of Med Tech Labs, Inc. owning 95% of Monogram Pictures,
Inc. Med Tech Labs, Inc. is undergoing the required audit process for
inclusion in Monogram Pictures, Inc.'s public disclosure. Med Tech Labs,
Inc. has retained the accounting firm of Pender Newkirk and Company, CPA's
for this process. Monogram Pictures, Inc.'s auditor, Clancy and Company,
Inc. has resign effective March 7th, 2002. Consequently, Monogram has
retained Pender Newkirk as its Auditor. Pender Newkirk is a Tampa Florida
firm with previous audit experience of the laboratory business that is now
operated by Med Tech Labs, Inc.
Med Tech Labs, Inc. d/b/a Med Services of America (MSA), is a full-service
independent clinical laboratory servicing the West Coast of Florida from
Dunnellon to Fort Myers. The history of the current operation dates back to
1957. Med Tech Labs, Inc is licensed by the State of Florida and is a
certified Medicare and Medicaid provider.
The main laboratory and home office is located at 1375 South Fort Harrison
Avenue in Clearwater, Florida. The facilities are housed in a 19,668 square
foot building. Housed within the facility is the main reference laboratory,
which comprises approximately 14535 square feet, materials management, client
services, accounting, billing, administration, and the central courier
station. Within the laboratory testing area resides an additional 2000 square
feet of expansion area which can accommodate growth of testing to over three
times the current volume. MSA operates 21 Patient Service Centers on the West
Coast of Florida. These are all leased premises serving as both specimen
drop-off points and patient walk-in centers. The business maintains 26
vehicles and a staff of couriers that pick up specimens and in some cases
hand deliver results when requested by the physicians.
The courier and client services support staff have a low rate of turnover and
thus an intimate knowledge of clients and client office personnel. MSA 26
vehicles that service its clients throughout its service area. Many of the
couriers and key client services personnel have been with the operation more
than five years. These long standing client relationships reinforce the
perception of tenure in the community, sound management, and a client driven
business.
In addition to the core business as a Physician's Laboratory, management has
identified three medical, diagnostic and therapeutic business services that
can be operated within the current organizational infrastructure, thereby
creating new economies of scale for each service line in addition to the core
business. By redefining necessary economies of scale through a shared
infrastructure the marketability of the entire operation will improve with
the "value added" perception of the business. The three business services
are Respiratory Therapy and Respiratory Durable Medical Equipment, Veterinary
Testing and Environmental Testing.
Respiratory Therapy and Respiratory Durable Medical Equipment includes
utilizing the existing courier infrastructure to deliver home-based
respiratory treatments, oxygen and oxygen-delivered pharmaceuticals to
patients. Utilizing its network of couriers and patient service centers and
contracting with established therapy providers, MSA can efficiently and
economically provide these services and achieve co-productive economies of
scale and resulting profits.
Again, exploiting the courier and technological infrastructure, veterinary
testing is a particularly lucrative business given concurrent geographic
service areas, customer loyalty, lack of effective local competition, and
utilization of superior technologies and staff. Veterinary testing has been
in limited beta and client utilization for one year. With the completion of
the service and technology model it is ready to be launched.
Environmental Testing is a new venture and represents less that 5% of MSA's
projected 2003 revenue. However, as more and more health problems are
identified and related to environmental factors the growth in this market
will be tremendous. In particular the development of pre-paid kits to test
environments and local contracts with engineering firms to certify facilities
will be the initial marketing focus.
As economies of scale increase, many smaller laboratories will experience
decreasing margins. As these labs feel the increasing economic pinch, MSA
will approach them as acquisition opportunities to be incorporated into its
book of business. With prudent acquisition strategies these labs represent a
significant market growth opportunity. As the following table and charts
show, Physician laboratory services is MSA's core business and will remain
so. Leveraging its infrastructure by the other three business services for
the first 12 complete months in Fiscal 2003 is forecasted to represent 24% of
MSA's top line Revenue and 47% of MSA's Net Income (EBITDA).
Projected 2003
Assumes Planned Acquisitions Closed by December 31, 2002
CORE Gross Percent Earnings Before EBITDA EBITDA %
BUSINESS Revenue To Total Tax,Depr,Amort. Percent To Total
Gr.
Profit
Physician's
Laboratory YES $ 20,841,600 75.92% $ 2,500,992 12.00% 52.74%
Respiratory LEVERAGED $ 2,886,000 10.51% $ 1,113,707 38.59% 23.48%
Veterinary
Testing LEVERAGED $ 2,725,600 9.93% $ 477,525 17.52% 10.07%
Environment
Testing LEVERAGED $ 1,000,000 3.64% $ 650,000 65.00% 13.71%
Total all Businesses $ 27,453,200 100% $ 4,742,225 17.27% 100%
LEVERAGED Business'
as a group $ 6,611,600 24% $ 2,241,233 34% 47%
Special Note: Management believes certain statements in this press release
may constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform act of 1995. These statements are made on the
basis of management's views and assumptions regarding future events and
business performance as of the time the statements are made. Actual results
may differ from those expressed or implied. Such differences may result from
actions taken by the company prior to its current fiscal year end, as well as
from developments beyond the company's control, including changes in global
economic conditions that may, among other things, affect the performance of
the company's anticipated acquisitions or future business. In addition,
changes in domestic competitive and economic conditions may also affect
performance of all significant company businesses. SOURCE Monogram Pictures,
Inc.
Contact:
Monogram Pictures, Inc.
David E. Salmon, Investor Relations
(727) 466-2302
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MONOGRAM PICTURES, INC.
By /s/ Thomas W. Kearney, CFO
Thomas W. Kearney, CFO
March 14, 2002