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 31, 2006


                                    PHC, Inc.
             (Exact Name of Registrant as Specified in its Charter)

                                  Massachusetts
                    (State of Incorporation or Organization)

        0-22916                                                   04-2601571
(Commission File Number)                                      (I.R.S. Employer
                                                             Identification No.)


200 Lake Street, Suite 102, Peabody, Massachusetts                  01960
 (Address of Principal Executive Offices)                        (Zip Code)


Registrant's telephone number, including area code:  (978) 536-2777

Check  the  appropriate  box  below  if the  Form  8-K  filing  is  intended  to
simultaneously  satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

___  Written  communications  pursuant to Rule 425 under the  Securities Act (17
     CFR 230.425)

___  Soliciting  material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
     240.14a-12)

___  Pre-commencement   communications  pursuant  to  Rule  14d-2(b)  under  the
     Exchange Act (17 CFR 240.14d-2(b))

___  Pre-commencement  communications  pursuant  to Rule  13c-4 (c)  under  the
     Exchange Act (17 CFR 240.13e-4 (c)


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Item 1.01.  Entry into a Material Definitive Agreement

     On March 31,  2006,  the Company  entered  into an  agreement  with Medical
Information  Technologies,  Inc.,  ("Meditech"),  an unaffiliated  Massachusetts
Corporation,  pursuant to which the Company has agreed to purchase  the right to
use licensed software, developed and maintained by Meditech, for the billing and
tracking of the Company's treatment facilities revenue and receivables.

     The total  purchase  price of the  agreement is $462,431,  of which 10% was
paid upon  signing  the  purchase  agreement,  40% is due upon  delivery  of the
software,  which is  expected  to be  approximately  six months from the signing
date,  40% is due 90 days following  software  delivery and 10 % is due 180 days
following  software  delivery.

     The Company  has been in  discussion  with lease  financing  companies  and
believes  that  opportunities  to convert the purchase to a lease with a nominal
buy-out wil be  available  for the  software.  The Company also expects to lease
approximately  $200,000  in  additional  hardware  in order to best  utilize the
Meditech  software  features under a thirty-six  month capital lease with a fair
market value buy-out.


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SIGNATURE


     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.


                                                    PHC, INC.


Date: April 5, 2006                                 By:  /s/ Bruce A. Shear
                                                             Bruce A. Shear
                                                             President



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