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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1993
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934
Commission file number 0-11479
SUMMIT HEALTH LTD.
(Exact name of Registrant as specified in its charter)
California 95-3154694
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2600 W. Magnolia Blvd.
P.O. Box 2100
Burbank, California 91507-2100
(address of principal executive offices)
(818) 841-8750
(Registrant's telephone number, including area code)
Indicate by checkmark 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 Registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes X No
----- -----
APPLICABLE ONLY TO ISSUERS INVOLVED IN
BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by checkmark whether the Registrant has filed all documents and reports
required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court.
Yes No
----- ------
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Shares of Registrant's common stock outstanding at
January 31, 1994 -- 32,510,670
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SUMMIT HEALTH LTD.
FORM 10-Q
QUARTER ENDED
DECEMBER 31, 1993
TABLE OF CONTENTS
Page of
Form 10-Q
---------
Part I - Financial Information
Item 1. Financial Statements
Consolidated Statements of Income 3
Consolidated Balance Sheets 4
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Part II - Other Information
Item 1. Legal Proceedings 17
Item 4. Submission of matters to a Vote of Security Holders 17
Item 6. Exhibits and Reports on Form 8-K 17
Signatures 18
2
PART I
SUMMIT HEALTH LTD.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share data)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
------------------ ------------------
1993 1992 1993 1992
---- ---- ---- ----
Net revenues $ 133,875 $ 129,991 $ 263,129 $ 251,783
Interest income 339 314 769 896
------- ------- ------- -------
Total revenue 134,214 130,305 263,898 252,679
Operating expenses:
Salaries and benefits 53,187 53,451 103,367 104,562
Purchased services and
professional fees 14,790 15,375 29,870 30,211
Supplies 16,775 15,948 33,120 31,025
Rental and insurance premiums to
affiliates 7,065 6,643 14,084 13,887
Contracted physician, hospital and
other services 5,577 5,162 10,445 9,658
Other operating 12,578 11,164 25,198 21,359
Depreciation and
amortization 5,170 4,350 10,420 8,559
Interest 2,083 1,133 4,294 3,306
Provision for doubtful
accounts 4,769 6,999 11,179 13,192
------- ------- ------- -------
121,994 120,225 241,977 235,759
------- ------- ------- -------
Income before income taxes and
minority interest 12,220 10,080 21,921 16,920
Provision for income taxes (5,314) (4,361) (9,517) (6,907)
Minority interest in net income of
consolidated subsidiary, net of taxes (809) (699) (1,409) (1,176)
------- ------- ------- -------
Net income $ 6,097 $ 5,020 $ 10,995 $ 8,837
------- ------- ------- -------
------- ------- ------- -------
Earnings per common and common
equivalent share $ 0.18 $ 0.15 $ 0.33 $ 0.27
------- ------- ------- -------
------- ------- ------- -------
Weighted average number of shares
of common stock outstanding 33,748 33,347 33,751 33,124
------- ------- ------- -------
------- ------- ------- -------
See accompanying notes
3
SUMMIT HEALTH LTD.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
DECEMBER 31, 1993 JUNE 30, 1993
----------------- -------------
(UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents $ 25,915 $ 40,857
Accounts receivable, less allowance for
doubtful accounts: December 1993 - $9,250;
June 1993 - $9,295 80,643 73,933
Other receivables 9,689 9,684
Supplies inventory, at cost (first-in, first-out) 9,689 9,452
Deferred income taxes 3,326 3,520
Prepaid expenses and other 4,634 6,711
-------- --------
Total current assets 133,896 144,157
Property, plant and equipment, at cost:
Land and land improvements 29,188 26,936
Buildings and leasehold improvements 202,913 197,621
Furniture and equipment 112,153 108,681
Construction in progress 7,608 3,653
-------- --------
351,862 336,891
Less accumulated depreciation and amortization 122,729 114,946
-------- --------
229,133 221,945
Long-term notes receivable (interest at 6% - 10%) 10,192 9,707
Non-current assets held for sale 5,419 5,419
Other assets and deferred charges 16,070 13,331
-------- --------
$394,710 $394,559
-------- --------
-------- --------
See accompanying notes
(Continued)
4
SUMMIT HEALTH LTD.
CONSOLIDATED BALANCE SHEETS (CONTINUED)
(Dollars in thousands)
DECEMBER 31, 1993 JUNE 30, 1993
----------------- -------------
(UNAUDITED)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Payable to bank $ 6,455 $ 8,545
Accounts payable 22,564 22,188
Employee compensation and benefits 16,535 16,892
Due to third-party payors 33,691 30,807
Income taxes payable -- 2,839
Accrued liabilities 12,230 13,724
Commercial paper notes 22,722 27,722
Long-term debt due within one year 2,196 11,383
-------- --------
Total current liabilities 116,393 134,100
Long-term debt 88,848 84,711
Other long-term liabilities 14,060 13,369
Deferred income taxes 33,260 33,152
Minority interest 16,513 15,104
-------- --------
Total liabilities 269,074 280,436
Commitments and contingencies
Shareholders' equity:
Preferred stock, $1 par value; 2,000,000
authorized shares, none issued -- --
Common stock, 100,000,000 authorized shares,
Issued and outstanding: December 1993 -
32,497,570; June 1993 - 32,048,800 52,936 51,118
Retained earnings 72,700 63,005
-------- --------
Total shareholders' equity 125,636 114,123
-------- --------
$394,710 $394,559
-------- --------
-------- --------
See accompanying notes
5
SUMMIT HEALTH LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
SIX MONTHS ENDED
DECEMBER 31,
1993 1992
-------- --------
Operating activities:
Net income $ 10,995 $ 8,837
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 10,420 8,559
Provisions for doubtful accounts 11,179 13,192
Deferred income taxes 302 (2,292)
Minority interest 1,409 1,176
Changes in operating assets and liabilities:
Accounts receivable (18,078) (13,773)
Other receivables (5) (2,085)
Supplies inventory (237) (1,049)
Prepaid expenses and other 2,077 609
Other assets (2,296) (330)
Payable to bank (2,090) (3,789)
Accounts payable 376 (151)
Accrued employee compensation and benefits (357) (1,156)
Due to third-party payors 2,884 (5,417)
Accrued liabilities (657) (56)
Other liabilities 691 5,217
Income taxes payable (1,664) (3,271)
-------- --------
Total adjustments 3,954 (4,616)
-------- --------
Net cash provided by operating activities 14,949 4,221
-------- --------
Investing activities:
Expenditures for additions to property, plant and
equipment (10,819) (34,645)
Disposition of assets 660 71
(Increase) decrease in notes receivable (485) 10,306
-------- --------
Net cash used in investing activities (10,644) (24,268)
-------- --------
See accompanying notes
(Continued)
6
SUMMIT HEALTH LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(Unaudited)
(Dollars in thousands)
SIX MONTHS ENDED
DECEMBER 31,
1993 1992
-------- --------
Financing activities:
Proceeds from borrowings $ -- $ 50,314
Payment of long- term and mortgage debts (18,608) (31,418)
Dividends paid (1,282) (938)
Proceeds from exercise of common stock options 643 1,122
-------- --------
Net cash provided by (used in) financing activities (19,247) 19,080
-------- --------
Net decrease in cash and cash equivalents (14,942) (967)
Cash and cash equivalents at beginning of period 40,857 24,937
-------- --------
Cash and cash equivalents at end of period $ 25,915 $ 23,970
-------- --------
-------- --------
Cash paid during the period for:
Interest (net of amount capitalized) $ 2,861 $ 3,025
Income taxes, net 11,167 10,900
Supplemental disclosures of non-cash investing
and financing activities:
Issuance of long-term debt in connection with
acquisition $ 8,558 $ --
Writeoff of net assets from discontinued operation (855) --
Subsidiary stock offering adjustment -- 3,937
Tax benefit of stock transactions with employees (1,175) (1,430)
Dividends declared (1,300) (939)
See accompanying notes
7
SUMMIT HEALTH LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in thousands)
1. The unaudited financial information included herein, in the opinion of
management, reflects all adjustments (all of which are of a normal recurring
nature), which are considered necessary to fairly state the Company's
financial position, its cash flows and the results of operations. Certain
reclassifications have been made to the prior year amounts to conform to the
fiscal 1994 presentation. These statements do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. For further information,
refer to the consolidated financial statements and footnotes thereto
included in the Company's 1993 Annual Report and Form 10-K.
2. The interim financial information herein is not necessarily representative
of those to be expected for a full year.
3. Net revenues are net of provisions for contractual allowances consisting
primarily of price adjustments for contractual reimbursement related to
patients participating in governmental and other health care programs
including reimbursement based on diagnosis related groups under the Medicare
prospective payment system.
4. On December 2, 1993, the Company entered into a definitive Agreement and
plan of merger with OrNda Healthcorp ("OrNda") providing for the acquisition
of the Company by OrNda. Pursuant to the merger agreement, the Company will
be acquired by and merged with a wholly owned subsidiary of OrNda. Each
outstanding share of the Company's common stock will be converted into the
right to receive $5.50 in cash and 0.2157 shares of OrNda common stock. The
transaction will be accounted for as a purchase. Completion of the merger
remains subject to a number of conditions, including shareholder approval.
The merger is also subject to the applicable waiting periods under the Hart-
Scott-Rodino Antitrust Improvements Act; local regulatory approvals; receipt
of financing in an amount sufficient to refinance the outstanding senior
bank debt of OrNda and a portion of the 7.5% Exchangeable Subordinated
Notes; receipt of certain consents or waivers from the holders of such Notes
and approval by the Securities and Exchange Commission on the joint proxy
statement relating to the acquisition. Shareholder meetings to vote on the
transaction are anticipated for early March of 1994. If approved, the
merger is expected to be completed shortly thereafter.
5. On December 1, 1993, Summit Care Corporation acquired a 206-bed nursing
center in the Woodlands, Texas. The purchase price was $950 in cash and
$6,668 in long-term notes with fixed rates primarily at six percent secured
by the property.
8
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Dollars in thousands, except share data)
PROPOSED MERGER
The Company has entered into a definitive agreement to merge with OrNda
Healthcorp (the "Merger"). See Note 4 to the financial statements. Subsequent
to the Merger, OrNda Healthcorp will have operations in 17 states and will
operate 46 acute care hospitals with over 7,700 licensed-beds; two psychiatric
centers with 138 licensed-beds; four surgery centers and a Medicaid HMO (Health
Choice Arizona) with over 21,000 covered lives. In addition, through Summit
Care Corporation, OrNda will operate 18 nursing care centers and four retirement
centers.
RESULTS OF OPERATIONS
For the quarter and six months ended December 31, 1993, the Company reported
earnings of $6,097 and $10,995, respectively, an increase of 21 percent and 24
percent from the same periods a year ago. Earnings per share increased 20
percent from $.15 per share for the second quarter in fiscal 1993 to $.18 per
share for the comparable period in fiscal 1994. Year to date earnings per share
increased 22 percent from $.27 per share in fiscal 1993 to $.33 per share in
fiscal 1994. Total net revenues increased 3 and 5 percent, respectively, for
the quarter and six months ended December 31, 1993.
Effective July 1, 1993 the Company adopted Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" (SFAS 109). Under SFAS 109, an
asset and liability approach for financial accounting and reporting for income
taxes is required. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. SFAS 109 requires provision of taxes on the undistributed net
income of subsidiaries which formerly was not required under the indefinite
reversal criterion in APB 23. The impact of the implementation of SFAS 109
increased the consolidated income tax rate by approximately 2 percent. The
cumulative effect on the deferred tax balances was not significant. Net income
for fiscal year 1993 did not required retroactive restatement, because the
application of SFAS 109 is prospective only.
Income tax provisions for the six months ended December 31, 1993 and 1992 were
computed at effective rates of 43.4 and 40.8 percent, respectively.
For the first six months of fiscal 1994, interest and depreciation/amortization
expense increased 30 and 22 percent, respectively. Interest expense increased
from $3,306 in fiscal 1993 to $4,294 in fiscal 1994. This was due primarily
from the $25,000 Summit Care Corporation senior subordinated debentures issued
in December, 1992. Depreciation and amortization expense increased from $8,559
in fiscal 1993 to $10,420 fiscal 1994. The increase in expense is primarily a
result of capital additions in the prior fiscal year for ambulatory surgery
centers and Summit Care Corporate purchases in December 1992 of the land and
buildings associated with ten of its facilities that it previously operated
under lease agreements.
9
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Dollars in thousands, except share data)
Acute Care
Net revenues for the quarter declined from $102,911 in fiscal 1993 to $100,332
in fiscal 1994. Fiscal 1993 included $907 more in favorable appeal and
reimbursement settlements. An additional $525 was due to a reduction in
reimbursement to hospitals by Health Choice Arizona, the Company's wholly owned
subsidiary. The remainder is attributable to reduced utilization in the acute
care hospitals.
For the six months ended December 31, 1993 compared to the six months ended
December 31, 1992, net revenues increased marginally to $199,584 from $199,449.
Long Term Care
Summit Care Corporation ("Summit Care") revenues increased $3,200 or 15 percent
from $20,838 for the quarter ended December 31, 1992 to $24,038 for the quarter
ended December 31, 1993. Revenues increased $5,383 or 13 percent from $40,764
for the six months ended December 31, 1992 to $46,147 for the six months ended
December 31, 1993. Approximately 18 percent of the increase was due to patient
rate increases, 53 percent was due to increased use of rehabilitative and other
ancillary services, net of contractuals, and 21 percent was due to increased
pharmaceutical sales, eight percent due to the new center in Texas. As a result
of increased rehabilitative and ancillary services, private and Medicare patient
revenues from Summit Care's nursing care and retirement centers as a percent of
gross operating revenues (excludes pharmaceutical revenues) was 62 percent of
the six months ended December 31, 1993, and 63 percent for the same period in
1992.
Managed Care and Other
Health Choice Arizona (HCA) net revenues increased 20 percent for the quarter
from $8,891 in fiscal 1993 to $10,646 in fiscal 1994. For the six months ended
December 31, 1993 compared to the same period a year ago, net revenues increased
13 percent from $17,736 to $20,048. HCA membership increased 12 percent for the
quarter and 19 percent for the six months ended December 31, 1993 compared to
fiscal 1993.
Summit Ambulatory Network, Inc. (SANI) contributed $1,280 and $2,621 in
increased net revenues, respectively, for the quarter and six months ended
December 31, 1993 compared to the same period a year ago of $455 for the quarter
and $554 for the six months. This increase was attributed to the addition of
two surgery centers located in Arizona and Southern California.
10
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
THREE MONTHS ENDED DECEMBER 31,
-----------------------------------------------
INCREASE %
1993 1992 (DECREASE) CHANGE
-------- -------- ---------- ------
NET REVENUES
Acute Care $100,332 $102,911 ($2,579) (3%)
Long Term Care 24,038 20,838 3,200 15%
Managed Care and Other 12,381 9,346 3,035 32%
Eliminations -
Intersegment revenue (2,876) (3,104) 228 7%
------- ------- -----
Net revenues $133,875 $129,991 $3,884 3%
------- ------- -----
------- ------- -----
INCOME BEFORE INCOME TAXES
AND MINORITY INTEREST
Acute Care $ 9,241 $ 8,931 $ 310 3%
Long Term Care 3,466 2,469 997 40%
Managed Care and Other 1,412 (48) 1,460 100+%
------- ------- -----
Operating profit 14,119 11,352 2,767 24%
Corporate expenses, net of
interest income 184 (140) 324 100+%
Interest expenses (2,083) (1,132) (951) (84)%
------- ------- -----
Income before income taxes
and minority interest $ 12,220 $ 10,080 $2,140 21 %
------- ------- -----
------- ------- -----
11
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
SIX MONTHS ENDED DECEMBER 31,
-----------------------------------------------
INCREASE %
1993 1992 (DECREASE) CHANGE
-------- -------- ---------- ------
NET REVENUES
Acute Care $199,584 $199,449 $135 0%
Long Term Care 46,147 40,764 5,383 13%
Managed Care and Other 23,223 18,290 4,933 27%
Eliminations -
Intersegment revenue (5,825) (6,720) (895) 13%
------- ------- -----
Net revenues $263,129 $251,783 $11,346 5%
------- ------- -----
------- ------- -----
INCOME BEFORE INCOME TAXES
AND MINORITY INTEREST
Acute Care $ 18,408 $ 16,276 $ 2,132 13%
Long Term Care 6,162 4,204 1,958 47%
Managed Care and Other 2,176 (103) 2,279 100+%
------- ------- -----
Operating profit 26,746 20,377 6,369 31%
Corporate expenses, net of
interest income (531) (152) (379) 100+%
Interest expense (4,294) (3,305) (989) (30)%
------- ------- -----
Income before income taxes
and minority interest $ 21,921 $ 16,920 $5,001 30%
------- ------- -----
------- ------- -----
12
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
Selected Statistics are Shown Below:
FISCAL
-------------------- INCREASE
1994 1993 (DECREASE)
---- ---- ----------
HOSPITALS
Facilities in operation
September 30 12 12 --
December 31 12 12 --
Licensed beds at:
September 30 1,618 1,641 (23)
December 31 1,618 1,641 (23)
Average occupancy:
First quarter 29% 31% (2)%
Second quarter 32% 32% --
Patient days:
First quarter 43,641 47,255 (3,614)
Second quarter 47,299 48,310 (1,011)
Net inpatient revenue per
patient day:
First quarter $1,475 $1,236 $ 239
Second quarter $1,430 $1,346 $ 84
Outpatient net revenue per visit:
First quarter $ 352 $ 411 $ (59)
Second quarter $ 338 $ 364 $ (26)
Admissions:
First quarter 10,970 10,973 (3)
Second quarter 11,170 11,027 143
Percentage of net revenues from
Medicare and Medicaid:
First quarter 34.9% 36.3% (1.4)%
Second quarter 38.2% 35.6% 2.6 %
13
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
Selected Statistics are Shown Below:
FISCAL
-------------------- INCREASE
1994 1993 (DECREASE)
---- ---- ----------
LONG TERM CARE
Facilities in operation at:
September 30 21 21 --
December 31 22 21 1
Licensed beds at:
First quarter 2,720 2,696 24
Second quarter 2,926 2,696 230
Average occupancy:
First quarter 87% 88% (1) %
Second quarter 88% 89% (1) %
Percentage of revenues from
Private and Medicare:
First quarter 63% 63% --
Second quarter 62% 63% (1) %
Percentage of revenues from
Medicaid:
First quarter 37% 37% --
Second quarter 38% 37% 1 %
14
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
FISCAL
-------------------- INCREASE
1994 1993 (DECREASE)
---- ---- ----------
AMBULATORY SURGERY CENTERS
Facilities in operation
Owned
September 30 3 1 2
December 31 3 1 2
Managed
September 30 1 0 1
December 31 2 0 2
Surgeries
Owned facilities
First Quarter 1,515 121 1,394
Second Quarter 1,755 362 1,393
Managed facilities
First Quarter 357 0 357
Second Quarter 623 0 623
LIQUIDITY AND CAPITAL RESOURCES
At December 31, 1993, the Company had $25,915 in cash and cash equivalents and
working capital of $17,503. During the six months ended December 31, 1993, the
Company's cash and cash equivalents had a net decrease of $14,942.
Net cash provided by operating activities increased $10,728 from $4,221 in the
first six months of 1993 to $14,949 in the first six months of 1994. Net cash
provided by operating activities in the first two periods of 1994 was used
primarily to reduce $13,608 in long-term mortgage debt and $5,000 in short-term
commercial paper notes and $10,819 for additions to property, plant and
equipment.
15
SUMMIT HEALTH LTD.
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Cont.)
Capital expenditures were $10,819 for the first six months of 1994 which was a
decrease of $23,826 from the same period last year which included $25,000 for
Summit Care's acquisition of leased properties. Capital expenditures for the
remainder of fiscal 1994 are projected at approximately $13,256 for equipment
and additions to existing properties and approximately $7,000 for acquisitions
primarily for physician practices. The Company intends to finance these
expenditures with internally generated funds and cash and cash equivalents on
hand.
In December 1993, the Company declared a $.04 per share cash dividend to
shareholders of record as of December 16, 1993 payable January 18, 1994. The
total cost was $1,300.
As a result of an examination of the Company's Federal income tax returns for
fiscal year 1984, 1985 and 1986, the Internal Revenue Service has challenged the
propriety of certain accounting methods utilized for tax purposes as well as
other issues. The most significant area of dispute involves the cash method of
accounting used by certain of the Company's subsidiaries on which the Company
expects to prevail. As of June 30, 1993, the Company estimated that $10,000 of
income tax and interest would be required to be provided and would be payable
along with $19,500 of previously provided taxes, if the Internal Revenue Service
prevailed on all significant areas of dispute. Based upon analysis of the
issues, the Company believes the amount of tax and interest payable upon
settlement will be less than amounts previously provided.
Legislative and regulatory action has continued to limit payment increase under
Medicare and Medicaid reimbursement programs. The Company, however, believes
that these continued changes will not have a material adverse effect on the
Company's future revenue or liquidity. Management believes that $25,915 of cash
and cash equivalents at December 31, 1993 combined with the unused proceeds from
its senior bank financing and short-term commercial paper notes, as well as
funds generated by operations, will be adequate to meet the Company's future
commitments.
16
PART II
SUMMIT HEALTH LTD.
OTHER INFORMATION
QUARTER ENDED
DECEMBER 31, 1993
Item 1. LEGAL PROCEEDINGS
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company's 1993 Annual Meeting of Shareholders was held on November
1, 1993. Proxies were solicited by the Company's management pursuant
to Regulation 14 under the Securities Exchange Act of 1934. There was
no solicitation in opposition to management's nominees as listed in
the proxy statement, and all of such nominees were elected pursuant to
the vote of shareholders.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
Form 8-K for proposed merger with OrNda Healthcorp filed on
December 9, 1993.
17
SUMMIT HEALTH LTD.
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.
SUMMIT HEALTH LTD.
Date: February 11, 1994 By: /s/ A. DEAN STALEY
-------------------------------
A. Dean Staley
Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)
Date: February 11, 1994 By: /s/ KENNETH W. PIPER
-------------------------------
Kenneth W. Piper
Corporate Controller
(Principal Accounting Officer)
18