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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
____________ TO ____________
COMMISSION FILE NUMBER 2-18244
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HELIAN HEALTH GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-4070276
State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
9600 BLUE LARKSPUR LANE, SUITE 201 93940
MONTEREY, CALIFORNIA (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (408) 646-9000
(Former name, former address and former fiscal year, if changed since las
report): NONE
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 proceeding 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.
--- ---
The number of shares outstanding of the registrant's Common Stock, $.01 Par
Value, as of October 9, 1995 was 5,475,075 shares.
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HELIAN HEALTH GROUP, INC.
FORM 10-Q QUARTERLY REPORT
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements....................................... 1
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations........................ 6
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings.......................................... 8
Item 2 - Changes in Securities...................................... 8
Item 3 - Defaults Upon Senior Securities............................ 8
Item 4 - Submission of Matters to a Vote of Security Holders........ 8
Item 5 - Other Information.......................................... 8
Item 6 - Exhibits and Reports on Form 8-K........................... 8
HELIAN HEALTH GROUP, INC.
CONSOLIDATED BALANCE SHEETS
August 31, 1995 NOVEMBER 30, 1994
--------------- -----------------
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents .................. $ 2,796,792 $ 4,118,459
Short-term investments ..................... 2,631,867 1,617,491
Accounts receivable, net of allowance for
doubtful accounts of $1,077,781 in 1995 and
$1,146,964 in 1994 ......................... 6,480,755 6,854,010
Current portion of notes receivable ........ 173,952 186,671
Inventories ................................ 578,104 508,969
Income taxes receivable .................... 541,930 1,071,930
Deferred income taxes ...................... 1,160,917 1,040,958
Prepaid expenses and other current assets .. 495,340 683,265
----------- -----------
Total current assets .................. 14,859,657 16,081,753
Investment in affiliated companies ............. 394,763 401,012
Notes receivable ............................... 263,802 398,875
Property and equipment, net .................... 11,662,661 12,655,061
Intangible assets, net ......................... 1,492,061 1,140,472
Other assets, net .............................. 430,788 235,877
----------- -----------
TOTAL ASSETS ................................... $29,103,732 $30,913,050
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable ........................... $ 681,306 $ 879,260
Accrued compensation and related expenses .. 1,968,941 1,654,247
Other accrued liabilities .................. 421,295 442,215
Payable to Palo Alto Medical Foundation .... 26,675 306,156
Current portion of long-term debt .......... 1,135,309 1,135,178
----------- -----------
Total current liabilities ............. 4,233,526 4,417,056
Deferred income taxes .......................... 213,000 213,000
Payable to Palo Alto Medical Foundation ........ 150,000 150,000
Long-term debt ................................. 5,307,507 6,103,603
Minority Interest .............................. 1,600 57,439
----------- -----------
TOTAL LIABILILTIES ............................. 9,905,633 10,941,098
----------- -----------
STOCKHOLDERS' EQUITY
Common stock, $.01 par value, 20,000,000 shares
authorized, 5,474,905 shares issued and
outstanding for 1995 (5,437,928 in 1994) ... 54,749 54,380
Additional paid-in capital ..................... 15,113,240 14,986,349
Retained earnings .............................. 4,121,030 5,022,143
Less: Treasury stock, at cost, 25,500 shares .. (90,920) (90,920)
----------- -----------
Total stockholders' equity ..................... 19,198,099 19,971,952
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY ..... $29,103,732 $30,913,050
=========== ===========
1
HELIAN HEALTH GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended August 31, Nine Months Ended August 31,
---------------------------- ----------------------------
1995 1994 1995 1994
---- ---- ---- ----
REVENUES:
Patient revenues .............................. $ 8,410,691 $ 9,090,301 $23,148,231 $26,080,035
Management fees and lease income .............. 1,092,831 833,012 3,227,578 2,738,554
Other ......................................... 71,653 -- 203,750 --
----------- ----------- ----------- -----------
Total revenues .................................. 9,575,175 9.923,313 26,579,559 28,818,589
----------- ----------- ----------- -----------
COSTS AND EXPENSES:
Salaries and wages ............................ 3,529,621 3,634,094 10,618,740 10,192,227
Employee benefits ............................. 645,280 582,728 2,115,760 1,730,391
Fees to individuals and organizations ......... 1,090,464 966,638 2,900,409 2,918,729
Supplies and other expenses ................... 703,640 896,250 2,017,173 2,689,732
Purchased services ............................ 630,486 542,501 1,878,572 1,489.996
Building and equipment rent ................... 466,082 398,880 1,453,060 1,221,451
Provision for doubtful accounts ............... 220,931 721,937 769,259 2,072,344
Other operating costs ......................... 917,392 820,186 2,936,896 2,531,662
Depreciation and amortization ................. 572,229 675,955 2,093,637 2,042,093
Employee severance costs ...................... -- -- 866,257 --
----------- ----------- ----------- -----------
Total costs and expenses ....................... 8,776,125 9,239,169 27,649,763 26,888,625
----------- ----------- ----------- -----------
OPERATING INCOME (LOSS) ......................... 799,050 684,144 (1,070,204) 1,929,964
Interest income ................................. 93,678 84,139 275,360 212,730
Interest expense ................................ (149,535) (97,035) (454,635) (547,149)
----------- ----------- ----------- -----------
Income (loss) before provision for (benefit from)
income taxes and minority interest ........... 743,193 671,248 (1,249,479) 1,595,545
Minority Interest ............................... 15,481 (108,283) (61,149) (454,466)
Provision for (benefit from) income taxes ....... 298,360 322,414 (287,217) 844,656
----------- ----------- ----------- -----------
NET INCOME (LOSS) ............................... $ 429,352 $ 457,117 $ (901,113) $ 1,205,355
=========== =========== =========== ===========
Net income (loss) per share ..................... $ 0.08 $ 0.08 $ (0.17) $ 0.22
=========== =========== =========== ===========
Shares used in calculation
of net income (loss) per share ............... 5,490,488 5,483,635 5,458,923 5,481,111
=========== =========== =========== ===========
2
HELIAN HEALTH GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
NINE MONTHS ENDED AUGUST 31,
-------------------------------
1995 1994
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) ............................... $ (901,113) $1,205,355
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization ................ 2,093,521 2,042,093
Provision for doubtful accounts .............. 769,259 2,072,344
Deferred income taxes ........................ (389,959) --
Equity in loss of affiliate .................. 6,249 212,870
Minority interest in consolidated subsidiaries (61,149) (306,335)
Changes in operating assets and liabilities,
net of effects from acquisition of business:
Accounts receivable ........................ (396,004) (2,560,833)
Prepaid expenses and other assets .......... (72,635) (231,152)
Accounts payable and accrued liabilities ... 101,130 124,801
Income taxes receivable or payable ......... 800,000 (99,858)
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Net cash provided by operating activities ..... 1,949,299 2,459,285
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment ............. (737,279) (389,894)
Sales of property and equipment ................. 83,225 --
Purchases of short-term investments, net ........ (1,014,376) (1,216,354)
Repayment on notes receivable ................... 147,792 1,278,131
Acquisition of business ......................... (800,000) --
Decrease in intangibles, net .................... 10,248 6,431
---------- ----------
Net cash used in investing activities ...... (2,310,390) (321,686)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term debt ...................... (1,106,957) (2,593,541)
Issuance of common stock ........................ 127,260 17,704
Proceeds from borrowings of long-term debt ...... 19,121 2,214,000
---------- ----------
Net cash used in financing activities ...... (960,576) (361,837)
---------- ----------
Net increase (decrease) in cash and cash equivalents (1,321,667) 1,775,762
Cash and cash equivalents at beginning of period ... 4,118,459 1,074,653
---------- ----------
Cash and cash equivalents at end of period ......... $2,796,792 $2,850,415
========== ==========
3
HELIAN HEALTH GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (all of which
were normal recurring accruals) necessary to present fairly Helian Health
Group's consolidated financial position as of August 31, 1995 and November
30, 1994, and the results of operations for the three and nine month
periods ended August 31, 1995 and August 31, 1994, which results are not
necessarily indicative of results on an annual basis.
2. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules
and regulations of the Securities Exchange Commission. These condensed
financial statements should be read in conjunction with the financial
statements and related notes contained in the Annual Report for the fiscal
year ended November 30, 1994 on Form 10-K.
3. The consolidated financial statements include the accounts of Helian and
its wholly-owned subsidiaries. The Company consolidates all
partially-owned subsidiaries where it possesses the ability to exercise
significant influence or control over operating and financial policies of
the subsidiary. The equity method of accounting is generally used when the
Company has a 20% to 50% interest in other entities. All material
intercompany transactions and balances have been eliminated in
consolidation.
4. The Company generates revenues principally from the following sources:
Patient revenues are recorded when the service is provided to the patient
and are recognized net of allowances and contractual adjustments related
to third-party payors. Provisions for doubtful accounts are recorded as
operating expenses.
Management fees and lease income are recorded monthly under agreements
with the Surgecenter of Palo Alto, which is managed by the Company. The
management fees are based on a percentage of gross revenue and adjusted
net income plus all direct costs of Surgecenter personnel. The Company
leases furniture, fixtures and equipment and subleases the facility to the
Surgecenter.
5. Property and equipment consisted of the following:
AUGUST 31, 1995 NOVEMBER 30, 1994
--------------- -----------------
Land and land improvements ................. $ 1,712,156 $ 1,712,156
Building ................................... 4,128,113 3,953,727
Furniture, fixtures and equipment .......... 10,687,315 10,098,507
Leasehold improvements ..................... 2,555,708 2,626,536
----------- -----------
19,083,292 18,390,926
Less accumulated depreciation and
amortization ............................... 7,420,631 5,735,865
----------- -----------
Net property and equipment ................. $11,662,661 $12,655,061
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4
6. On August 30, 1995, the Company signed a definitive agreement to be
acquired by TheraTx, Incorporated. In exchange for each share of Helian
common stock, TheraTx has agreed to issue shares of its common stock at an
exchange rate ranging between 0.4063 and 0.4809 shares, based upon the
market value of TheraTx common stock prior to the closing of the
transaction. In the event the average of the daily last sales price for
TheraTx common stock during the ten consecutive trading days immediately
prior to the fifth trading day prior to Helian's special meeting of
stockholders to consider the proposed merger is less than $12.25, Helian
has the right to terminate the agreement and, in that event, TheraTx is
required to pay Helian $300,000. The transaction is intended as a tax-free
reorganization, will be accounted for as a pooling of interests and is
expected to be completed around the end of 1995. The transaction has been
approved by the boards of directors of both companies, but remains subject
to regulatory approvals, approval by the stockholders of Helian and other
customary closing conditions.
5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The Company had revenues of $9,575,000 and net income of $429,000 for the
quarter ended August 31, 1995, as compared to revenues and net income of
$9,923,000 and $457,000, respectively, for the same period of 1994. For the nine
months ended August 31, 1995, revenues were $26,580,000 with a net loss of
$901,000, as compared to revenues of $28,819,000 and net income of $1,205,000
for the similar period of 1994. Revenues for the nine months were lower
primarily as a result of a decrease in average revenue per patient visit,
partially offset by an increase in patient visits in most of the Company's
operations. During the third quarter of 1995, patient visits increased in most
of these same operations as compared to the same period of 1994; however, lower
revenue per patient visit more than offset this increase resulting in lower
revenues. Average revenue per patient visit decreased for the three and nine
months of 1995 as a result of increased patient discounts, which was primarily
due to the Company's continued transition into a managed care provider system.
Excluding the Surgecenter of Palo Alto, which derives its revenue and net income
from a management contract, total patient visits and average revenue per visit
were 85,400 and $98, respectively, for the third quarter of 1995 as compared to
79,800 and $114, respectively, for the 1994 quarter. For the nine months of
1995, total patient visits and average revenue per visit were 230,500 and $100,
respectively; and 219,900 and $119, respectively, for the 1994 period. The
Company expects that profit margins will likely be reduced as the Company, and
the health care industry in general, transitions from fee-for-service
reimbursement to discounted fee-for-service to a system of capitation or other
risk-based reimbursement arrangement.
Salaries and wages, as a percentage of revenues, remained constant at 37% for
the three months ending August 31, 1995 as compared to 1994, and increased from
35% to 40% for the nine month period of 1995 as compared to the same period in
1994. The increase resulted primarily from hiring additional staff at certain
facilities to service increased business, partially offset by converting full
time positions to "as needed" per diem positions in other facilities.
As a percentage of revenues, employee benefits increased from 5.9% to 6.7% for
the third quarter of 1995 compared to the same quarter of 1994. For the nine
months ended August 31, 1995, employee benefits increased from 6.0% to 8.0%% as
compared to the same nine months of 1994. The increases principally resulted
from higher health and life insurance costs in 1995 as compared to 1994.
Fees to individuals and organizations increased, as a percentage of revenues,
from 9.7% for the three months ended August 31, 1994 to 11.4% for the comparable
period of 1995. For the nine months ended August 31, 1994 and August 31, 1995,
the costs increased, as a percentage of revenues, from 10.1% to 10.9%,
respectively. The increases are a function of increased patient visits due to
the company using higher-priced consultants to service increased business.
Supplies and other expenses decreased, as a percentage of revenues, from 9.0% to
7.4% for the three months ended August 31, 1994 and 1995, respectively, and
decreased from 9.3% to 7.6% for the nine months ended August 31, 1994 and 1995,
respectively. Cost containment efforts by the facilities, including enhanced
inventory controls, resulted in lower purchases for 1995. The lower costs were
partially offset by costs related to increased patient visits.
Purchased services increased, as a percentage of revenues, from 5.5% to 6.6% for
the quarters ended August 31, 1994 and 1995, respectively, and increased from
5.2% to 7.1% for the nine months of 1994 and 1995, respectively.
Provision for doubtful accounts, as a percentage of revenues, decreased from
7.3% for the third quarter of 1994 to 2.3% for the comparable quarter of 1995,
and decreased from 7.2% to 2.9% for the nine months ending August 31,
6
1994 and 1995, respectively. The deceases in the provisions resulted from
increases in allowances for doubtful accounts at some of the Company's
facilities during 1994.
Employee severance costs represents a lump sum payment of $800,000 and
associated costs related to the resignation of a former officer of the Company.
The provision for income taxes, as a percentage of income before income taxes,
remained constant at 41% for the third quarters of 1995 and 1994, and for the
nine months ending August 31, 1994. The (benefit from) income taxes, as a
percentage of (loss) before income taxes, was (24%) for the nine months ending
August 31, 1995. The Company's benefit rate of 24% is less than the statutory
rate due to the possibility not all net operating losses will provide future tax
deductions.
LIQUIDITY AND CAPITAL RESOURCES
As of August 31, 1995, the Company had working capital of $10,626,000 and a
working capital ratio of 3.51 to 1, compared to working capital of $11,665,000
and a working capital ratio of 3.64 to 1 at November 30, 1994.
The Company's debt to equity ratio decreased from .36 to 1 to .34 to 1 for the
periods ending November 30, 1994 and August 31, 1995, respectively.
Cash and cash equivalents decreased by $1,322,000 from $4,118,000 at November
30, 1994 to $2,797,000 at August 31, 1995. The decrease resulted primarily from
net investments of $1,014,000 in short-term securities during the period.
Operating activities increased cash by $1,949,000, which was offset by
$1,014,000 from investing activities (excluding short-term investments) and
$961,000 from financing activities. Cash provided from operations in the amount
of $1,949,000 included principally depreciation and amortization, income tax
refund and provision for doubtful accounts, partially offset by the net loss,
changes in operating assets and liabilities and deferred income taxes. Cash used
in investing activities in the amount of $2,310,000 consisted primarily of net
purchases of short-term investments, the acquisition of an occupational medicine
medical center and purchases of property and equipment, offset by repayment on
notes receivable and proceeds from sales of property and equipment. Cash used in
financing activities in the amount of $961,000 included primarily payments of
long-term debt.
The Company acquired, on April 3, 1995, a medical center in Fresno, California
which specializes in occupational medicine. The $800,000 purchase price was paid
in cash at the acquisition date.
On April 10, 1995, Thomas D. Wilson resigned as President, Chief Executive
Officer, Chairman of the Board and as a director of the Company. In connection
with the resignation, the Company recorded $866,000 of severance costs.
The Company believes its cash reserves, including cash generated from
operations, and the Company's borrowing capacity, are adequate to meet operating
cash requirements for at least the next twelve months.
7
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
None
ITEM 2 - CHANGES IN SECURITIES
None
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5 - OTHER INFORMATION
On August 30, 1995, the Company signed a definitive agreement to be acquired
by TheraTx, Incorporated. In exchange for each share of Helian common stock,
TheraTx has agreed to issue shares of its common stock at an exchange rate
ranging between 0.4063 and 0.4809 shares, based upon the market value of
TheraTx common stock prior to the closing of the transaction. In the event
the average of the daily last sales price for TheraTx common stock during
the ten consecutive trading days immediately prior to the fifth trading day
prior to Helian's special meeting of stockholders to consider the proposed
merger is less than $12.25, Helian has the right to terminate the agreement
and, in that event, TheraTx is required to pay Helian $300,000. The
transaction is intended as a tax-free reorganization, will be accounted for
as a pooling of interests and is expected to be completed around the end of
1995. The transaction has been approved by the boards of directors of both
companies, but remains subject to regulatory approvals, approval by the
stockholders of Helian and other customary closing conditions.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
2.1(11) Agreement and Plan of Merger with TheraTx, Incorporated and
related Stock Options Agreement and Stockholders Agreement.
3.1(1) Restated Certificate of Incorporation of the Company.
3.2(5) Amendment to Certificate of Incorporation of the Company
3.3 By-laws of the Company.
8
10.1(1) Asset Purchase Agreement between AMI Ambulatory Centers, Inc. and
Helian Health Group of Georgia, Inc., dated as of December 7,
1987.
10.2(1) 1989 Amended and Restated Stock Option Plan of Helian Health
Group, Inc.
10.3(1) Asset Purchase Agreement among AMI Ambulatory Centers, Inc.,
Howell Industrial Clinic, Inc. Helian Health Group, Inc., and
Helian Health Group of Atlanta, Inc. dated August 9, 1988.
10.4(1) Asset Purchase Agreement between Palo Alto Surgecenter Corporation
and Palo Alto Medical Foundation for Health Care, Research and
Education dated September 22, 1988.
10.5(1) Management Agreement between Palo Alto Surgecenter Corporation and
Palo Alto Medical Foundation for Health Care, Research and
Education dated September 22, 1988.
10.6(1) Equipment Lease between Palo Alto Surgecenter Corporation and Palo
Alto Medical Foundation for Health Care, Research and Education
dated September 22, 1988.
10.7(1) Sublease dated September 22, 1988, between Palo Alto Surgecenter
Corporation, as sublessor, and Palo Alto Medical Foundation for
Health Care, Research and Education, as sublessor, including
Consent to Sublease, covering premises at 400 Forest Avenue, Palo
Alto, California.
10.8(1) Repurchase Agreement between Palo Alto Surgecenter Corporation and
Palo Alto Medical Foundation for Health Care, Research and
Education dated September 22, 1988.
10.9(1) Letter Agreement dated October 1, 1987, between Helian Health
Group of Miami, Inc. and Kenneth Mikel, Ph.D. regarding
development of additional occupational medical facilities.
10.10(1) Recovery Inn(sm) of Los Gatos, a California Limited Partnership,
Agreement dated November 18, 1987.
10.11(1) First Amendment to the Limited Partnership Agreement of Recovery
Inn(sm) of Los Gatos dated January 15, 1988.
10.12(1) Assignment of General Partnership Interest - Recovery Inn(sm) of
Los Gatos to Helian Recovery Corporation, dated January 29, 1988.
10.13(1) Common Stock Purchase Agreement dated November 16, 1987, between
Harvey Knoernschild, M.D., Paul Schrupp, Recovery Inns(sm) of
America, Inc. and Helian Recovery Corporation.
10.14(1) Assignment Agreement to Stock Purchase Agreement dated June 2,
1989 among Helian Health Group, Inc., Margo Mynderse-Isola and
Donald C. Blanding.
10.15(1) Assignment Agreement to Stock Purchase Agreement dated July 14,
1989, among Helian Health Group, Inc., Lori Iaconis and (i)
William Hines, (ii) Rose L. Parkes, (iii) Tony M. Schierbeck, and
(iv) Kim Richmond.
10.16(1)* Key Managers Incentive Compensation Plan.
10.17(1)* Executive Directors Incentive Compensation Plan.
10.18(1) Stock Purchase Agreement between Helian Health Group, Inc. and
Andrew Miller, dated February 1, 1987.
9
10.19(1)* Employment Agreement dated October 8, 1986, as amended, between
Helian Health Group, Inc. and Thomas D. Wilson.
10.20(1)* Employment Agreement dated January 1, 1993, between Helian Health
Group, Inc. and Andrew Miller.
10.21(1) Stock Option Agreement dated August 1, 1987, between Donald
Blanding and Helian Health Group, Inc.
10.22(1) Amendment to Loan Agreement between Helian Health Group, Inc. and
Society National Bank.
10.23(1) Term Loan Agreement between Helian Health Group, Inc. and Society
National Bank dated October 8, 1986.
10.24(1) Term Loan Agreement between Helian Health Group, Inc. and Society
National Bank dated January 19, 1988.
10.25(1) Term Loan Agreement between Helian Health Group, Inc. and Society
National Bank dated August 11, 1988.
10.26(1) Security Agreement between Helian Health Group, Inc. and Society
National Bank dated October 8, 1986.
10.27(1) Security Agreement between Helian Health Group, Inc. and Society
National Bank dated January 19, 1988.
10.28(1) Security Agreement between Helian Health Group, Inc. and Society
National Bank dated August 11, 1988.
10.29(1) Pledge Agreement between Helian Health Group, Inc. and Society
National Bank dated October 8, 1986.
10.30(1) Amended Pledge Agreement between Helian Health Group, Inc. and
Society National Bank dated January 19, 1988.
10.31(1) Amended Pledge Agreement between Helian Health Group, Inc. and
Society National Bank dated August 19, 1988.
10.32(1) Waiver Letter dated September 22, 1988, from Society National Bank
regarding conditions of Term Loan Agreements.
10.33(1) Lease dated December 20, 1988, between Helian Health Group, Inc.,
as tenant, and Roger Winslow, as landlord, covering premises at
1000 8th Street, Monterey, California.
10.34(1) Lease dated April 9, 1987, between Austin Occupational Health
Center, Inc., as tenant, and Crow- Gottesman-Hill #27, as
landlord, covering premises at 2112 Rutland Drive, Suite 180,
Austin, Texas.
10.35(1) Lease dated August 15, 1985, including Assignment, between Austin
Occupational Health Center, Inc., as tenant, and Dry Doc Building
Corporation, as landlord, covering premises at 1213 North IH35,
Austin, Texas.
10.36(1) Lease dated September 6, 1984, including Assignments and
Assignment, between Helian Health Group of Atlanta, Inc., as
tenant, and as successor-in-interest to AMI Ambulatory Centers,
Inc. and Howell Industrial Clinic, Inc., and First Union
Management, Inc., as landlord, covering premises at 730 Peachtree
Building, Atlanta, Georgia.
10.37(1) Lease dated July 12, 1974, including Amendments and Assignments,
between Helian Health Group, Inc., as tenant, and as
successor-in-interest to Industrial Clinic Professional
Corporation and AMI Ambulatory Centers, Inc., and Chestnut
Associates, as landlord, covering premises at 3580 Atlanta Avenue,
Hapeville, Georgia.
10
10.38(1) Lease dated December 24, 1985, including Assignment, between
Helian Health Group of Georgia, Inc., as tenant, and as
successor-in-interest to AMI Ambulatory Centers, Inc., and Homart
Development Co., as landlord, covering premises at 3490 Piedmont
Road, N.E., Atlanta, Georgia.
10.39(1) Lease dated February 26, 1987, between Helian Health Group of
Georgia, Inc., as tenant, and Peterson Properties as landlord,
covering premises at 6475 Jimmy Carter Blvd., Norcross, Georgia.
10.40(1) Lease dated September 10, 1987, between Tucson Occupational Health
Center, as tenant, and The Atrium Associates, as landlord,
covering premises at 5099 East Grant Road, Tucson, Arizona.
10.41(1) Lease dated May 2, 1980, including Assignment, between Tucson
Occupational Health Center as tenant, and as successor-in-interest
to Robert Levitin, M.D. and Marcia Levitin, d/b/a Occupational
Medicine Clinic of Tucson, and Lot One, T.B.P., as landlord,
covering premises at Lot 1, Tucson Business Yard, Tucson, Arizona.
10.42(1) Lease dated May 7, 1976, including Assignment, between Palo Alto
Surgecenter Corporation, as tenant, and Gorman Whitney Development
Co., as landlord, covering premises at 400 Forest Avenue, Palo
Alto, California.
10.44(1) Deed dated November 18, 1987, for land purchased by Recovery Inn
of Los Gatos located in Campbell, California.
10.45(1) Agreement Dated May 22, 1988, between Recovery Inns(sm) of
America, Inc. and San Jose Medical Center.
10.46(1)* Employment Agreement dated January 1, 1993, between Helian Health
Group, Inc. and Donald C. Blanding.
10.47(5) Amended and Restated 1989 Stock Option Plan of the Company
10.48(1)* Stock Option Agreement dated as of April 1, 1987, between the
Company and William A. Hines.
10.49(1) Loan Agreement dated June 27, 1990, between the Company and First
Interstate Bank of California.
10.50(1) Security Agreement dated June 27, 1990, between the Company and
First Interstate Bank of California.
10.51(1) Installment Note dated June 14, 1990, payable to First Interstate
Bank of California.
10.52(1) Revolving Credit Note dated June 14, 1990, payable to First
Interstate Bank of California.
10.531 Purchase Agreement dated June 11, 1990, among Well America, a
general Partnership, J. Michael Hitt, M.D. and Tucson Occupational
Health Center, Inc., a wholly-owned subsidiary of the Company.
10.54(1) Real Estate Purchase Contract and Receipt for Deposit, dated June
1989, between the Company and the Menlo Park Willows, a California
Limited Partnership.
10.55(1) Letter Agreement, dated May 29, 1990, between Recovery Inn(sm) of
Los Gatos, a California Limited Partnership, and Sanwa Bank
California, a California corporation, as Corporate Co-Trustee for
Carpenters Pension Trust Fund for Northern California.
10.56(1) Letter Agreement, dated June 6, 1990, between Recovery Inn(sm) of
Los Gatos, a California Limited Partnership, and Tokai Bank of
California.
11
10.57* Amendment of Employment Agreement For Thomas D. Wilson, dated
December 21, 1990, between the Company and Thomas D. Wilson.
10.58(2) Asset Purchase Agreement between Steven C. Schumann, M.D., Inc.,
Steven C. Schumann, M.D., Helian Health Group of Fresno, Inc., and
Helian Health Group, Inc., dated April 1, 1991.
10.59(2) Management Service Agreement by and among Helian Health Group of
Fresno, Inc., and Steven C. Schumann, M.D., Inc.
10.60(2) Covenant Not to Compete Agreement dated April 1, 1991, between
Helian Health Group of Fresno, Inc., and Steven C. Schumann, M.D.
10.61(2) Consulting Agreement dated April 1, 1991, by and between Helian
Health Group, Inc. and Steven C. Schumann, M.D.
10.62(3) Asset Purchase Agreement among Southern Back & Orthopaedic Center,
P.C., William D. Cabot and Helian Health Group, Inc. dated June
17, 1991.
10.63(3) Employment Agreement between Rehabilitative Back Center of
Atlanta, Inc. and William D. Cabot dated June 17, 1991.
10.64(3) Consulting Agreement between Rehabilitative Back Center of
Atlanta, Inc. and William D. Cabot dated June 17, 1991.
10.65(3) Medical Supervisor Agreement between Rehabilitative Back Center of
Atlanta, Inc. and William D. Cabot dated June 17, 1991.
10.66* Employment Agreement, dated April 1, 1992, between the Company and
J. Spencer Davis.
10.67* Employment Agreement, dated August 1, 1992, between the Company
and Michael K. McMillan.
10.68(4) Agreement to Provide Guaranty, dated April 16, 1992, as amended by
the First Amendment, between the Company and Jacob Noghreian,
Jeremy Cole, Jeffrey Aaronson, John Sherman and John Alexander.
10.69(4) Ground Lease, dated April 17, 1992, between the Company and
Recovery Inn of Menlo Park, a California limited partnership.
10.70(4) Master Lease, dated October 25, 1991, between Diagnostic Imaging
of Atlanta, L.P., and Norwest Financial Leasing, Inc.
10.71(4) Unconditional Guaranty Agreement, dated November 30, 1992, by the
Company to Norwest Financial Leasing, Inc.
10.72(4) Guaranty, dated January 22, 1993, by the Company to MetLife
Capital Corporation.
10.73(6) Management Agreement between Salinas Surgery Center and Helian ASC
of Salinas, Inc., dated, July 15, 1993.
10.74(6) Partnership Agreement between Helian ASC of Salinas and
Concentrated Care, Inc., dated, July 15, 1993
12
10.75(6) Term Loan Agreement between Palo Alto Surgecenter Corporation and
MetLife Capital Corporation dated, August 5, 1993.
10.76(6) Term Loan Agreement between Recovery Inn(sm) of Los Gatos, Ltd.
and MetLife Capital Corporation dated, August 5, 1993.
10.77(6) Lease dated, March 1, 1993 between Helian Health Group, Inc. and
Lightner Place Associates covering premises at 955 Blanco Circle,
Suite A, Salinas, California.
10.78(7) Term Loan Agreement between Helian Health Group, Inc., and MetLife
Capital Corporation dated, September 14, 1993.
10.79(7) Term Loan Agreement between Salinas Surgery Center and MetLife
Capital Corporation dated, November 24, 1993.
10.80(8)* Employment Agreement dated March 26, 1994 between Helian Health
Group, Inc. and William A. Hines.
10.81* Employment Agreement dated February 1,1994 between Helian Health
Group, Inc. and Leslie J. Arliskas.
10.82(9) Loan Agreement dated May 4 , 1994 between Helian Health Group,
Inc. and Sumitomo Bank of California.
10.83(9) Management Agreement dated February 26, 1994 between Helian Health
Group, Inc. and Marin General Hospital.
10.84(10) Asset Purchase Agreement by and among Industrial Medical Group,
Theodore R. Johstone, M.D., Kathryn Johnstone, R.N., Primary Care
Medical Group, Inc., Paul Cohen, M.D., Paul Cohen Family Trust and
Helian Health Group of Fresno, Inc. dated March 31, 1995.
10.85* Thomas D. Wilson Resignation Term sheet dated April 9, 1995.
- -------------------
* Employment Agreement or Compensatory Plan or Arrangement.
1 Incorporated by reference to Registrant's Registration Statement Number
33-31520 on Form S-1, filed October 11, 1989, Amendment Number 2 thereto
filed November 21, 1989, and Post-Effective Amendments Number 1 and Number
2 thereto filed November 22, 1990 and January 16, 1991, respectively.
2 Incorporated by reference to corresponding exhibit number in the Company's
Form 8-K filed on April 11, 1991.
3 Incorporated by reference to corresponding exhibit number in the Company's
Form 8-K filed on June 24, 1991.
4 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-K filed on March 1, 1993.
5 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-Q filed on July 14, 1993.
13
6 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-Q filed on October 14, 1993.
7 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-K filed on February 26, 1994.
8 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-Q filed on April 13, 1994.
9 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-Q filed on July 14, 1994.
10 Incorporated by reference to corresponding exhibit number in the Company's
Form 10-Q filed on July 14, 1995.
11 Incorporated by reference to corresponding exhibit number in the Company's
Form 8-K filed on September 1, 1995.
(b) Reports on Form 8-K
A Form 8-K was filed on September 1, 1995, describing the August 29, 1995
Agreement and Plan of Merger with TheraTx, Incorporated and related Stock
Option Agreement and Stockholders Agreement.
14
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.
HELIAN HEALTH GROUP, INC.
OCTOBER 13, 1995
/S/ HERBERT W. FOSTER
------------------------------------------------------
HERBERT W. FOSTER, ACTING CHIEF FINANCIAL OFFICER
OCTOBER 13, 1995
/S/ DONALD C. BLANDING
--------------------------------------------------------
DONALD C. BLANDING, TREASURER
15