-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WgvpF75smzgNeVGuMOnnxaRzfJlF2ubVlK0FQ49ZOOVN85kmY6lJnegahhP5rrNw JvYG/LWrVQu8kd2XfvSmuA== 0000830158-96-000020.txt : 19961115 0000830158-96-000020.hdr.sgml : 19961115 ACCESSION NUMBER: 0000830158-96-000020 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960903 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19961113 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEAFIELD CAPITAL CORP CENTRAL INDEX KEY: 0000830158 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MEDICAL LABORATORIES [8071] IRS NUMBER: 431039532 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-16946 FILM NUMBER: 96661162 BUSINESS ADDRESS: STREET 1: 2600 GRAND AVE STE 500 STREET 2: P O BOX 410949 CITY: KANSAS CITY STATE: MO ZIP: 64141 BUSINESS PHONE: 8168427000 MAIL ADDRESS: STREET 1: P.O. BOX 410949 STREET 2: 2600 GRAND AVENUE, SUITE 500 CITY: KANSAS CITY STATE: MO ZIP: 64141 FORMER COMPANY: FORMER CONFORMED NAME: BMA CORP /MO/ DATE OF NAME CHANGE: 19910520 FORMER COMPANY: FORMER CONFORMED NAME: SEAFIELD CAPTIAL CORP DATE OF NAME CHANGE: 19910520 FORMER COMPANY: FORMER CONFORMED NAME: BMA PROPERTIES INC DATE OF NAME CHANGE: 19880411 8-K/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 8-K/A (Amendment No. 1) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: September 3, 1996 Seafield Capital Corporation ------------------------------------------------------ (Exact name of registrant as specified in its charter) Missouri 0-16946 43-1039532 ----------------------------------------------------------------- (State of other (Commission File Number) (IRS Employer jurisdiction of Identification incorporation) Number) 2600 Grand Ave. Suite 500 P. O. Box 410949 Kansas City, MO 64141 ----------------------------------------------------------------- (Address of principal executive offices) (Zip code) (816) 842-7000 ----------------------------------------------------------------- (Registrant's telephone number, including area code) Item 2. Acquisition or Disposition of Assets. On September 18, 1996, the Registrant filed a Current Report on Form 8-K dated September 3, 1996 reporting the consummation of the acquisition by its 55% owned subsidiary, Response Oncology, Inc. (Response), of Rosenberg & Kalman, M.D., P.A. (the Tamarac Practice). The Registrant hereby files amendment No. 1 to the previously filed Form 8-K to provide the audited financial statements of Rosenberg & Kalman, M.D., P.A. and the Registrant's pro forma financial information. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (a) Financial Statements Audited Balance Sheet, Statement of Income, Statement of Shareholders' Equity and the Statement of Cash Flows, including footnotes, as of and for the year ended December 31, 1995 for Rosenberg and Kalman, M.D., P.A. (b) Pro Forma Financial Information Pro Forma Consolidated Balance Sheet for Seafield Capital Corporation (Seafield) and the Tamarac practice as of June 30, 1996 and Pro Forma Consolidated Statements of Operations for Seafield and the Tamarac practice for the six months ended June 30, 1996 and the year ended December 31, 1995. (c) Exhibits 10(a) Form of the Stock Purchase Agreement among Response Oncology, Inc., Alfred M. Kalman, M.D. and Abraham Rosenberg, M.D. dated as of September 1, 1996 (filed as Exhibit 10(a) to Registrant's Form 8-K dated September 3, 1996 and incorporated herein by reference). 10(b) Form of the Service Agreement among Response Oncology, Inc., Rosenberg & Kalman, M.D., P.A., R&K, M.D., P.A. and Stockholders of R&K, M.D., P.A. dated as of September 1, 1996. (filed as Exhibit 10(b) to Registrant's Form 8-K dated September 3, 1996 and incorporated herein by reference). INDEPENDENT AUDITORS' REPORT The Board of Directors Rosenberg and Kalman, M.D., P.A.: We have audited the accompanying balance sheet of Rosenberg and Kalman, M.D., P.A. as of December 31, 1995, and the related statements of operations, stockholders' equity, and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Rosenberg and Kalman, M.D., P.A. as of December 31, 1995, and the results of its operations and its cash flows for the year then ended in conformity with generally accepted accounting principles. KPMG PEAT MARWICK LLP Miami, Florida June 7, 1996 ROSENBERG AND KALMAN, M.D., P.A. BALANCE SHEETS
DECEMBER 31, MARCH 31, 1995 1996 ------------ ----------- (UNAUDITED) ASSETS Current assets: Cash............................................................... $ 744 $ 37,506 Accounts receivable, net of allowance for contractual adjustments and uncollectible amounts of $534,000 and $320,000 in 1995 and in 1996 (unaudited), respectively............................... 536,069 763,137 Supplies........................................................... 122,701 97,621 Prepaid expenses................................................... 42,058 43,455 ------------ ----------- Total current assets....................................... 701,572 941,719 ------------ ----------- Furniture and equipment: Furniture and fixtures............................................. 183,097 183,097 Medical equipment.................................................. 78,460 78,460 Transportation equipment........................................... 35,841 35,841 ------------ ----------- 297,398 297,398 Less accumulated depreciation...................................... 219,920 225,182 ------------ ----------- Net furniture and equipment..................................... 77,478 72,216 Deferred income taxes................................................ 10,188 -- Other assets......................................................... 7,049 7,049 ------------ ----------- $796,287 $ 1,020,984 ========== ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses.............................. $671,076 $ 280,084 Accrued employee compensation...................................... 25,222 15,218 Current portion of long-term debt.................................. 9,990 10,364 Income taxes payable............................................... -- 8,783 ------------ ----------- Total current liabilities.................................. 706,288 314,449 ------------ ----------- Long-term debt....................................................... 19,981 18,138 Deferred income taxes................................................ -- 226,243 Stockholders' equity: Common stock, $1 par value. Authorized 1,000 shares; issued and outstanding 100 shares.......................................... 100 100 Retained earnings.................................................. 69,918 462,054 ------------ ----------- Total stockholders' equity................................. 70,018 462,154 Commitments and contingencies ------------ ----------- $796,287 $ 1,020,984 ========== =========
See accompanying notes to financial statements. ROSENBERG AND KALMAN, M.D., P.A. STATEMENTS OF OPERATIONS
FOR THE THREE-MONTH YEAR ENDED PERIOD ENDED DECEMBER 31, MARCH 31, 1995 1996 ------------ ------------ (UNAUDITED) Net patient service revenue.......................................... $4,196,802 $ 1,298,572 Expenses: Operating.......................................................... 4,160,583 582,302 Depreciation....................................................... 22,807 5,262 Other.............................................................. 330,794 73,658 ------------ ------------ 4,514,184 661,222 ------------ ------------ Income (loss) before income taxes.......................... (317,382) 637,350 Income tax provision (benefit)....................................... (113,092) 245,214 ------------ ------------ Net income (loss).......................................... $ (204,290) $ 392,136 ========== =========
See accompanying notes to financial statements. ROSENBERG AND KALMAN, M.D., P.A. STATEMENTS OF STOCKHOLDERS' EQUITY
TOTAL COMMON RETAINED STOCKHOLDERS' STOCK EARNINGS EQUITY ------ --------- ------------- Balances, December 31, 1994................................... $100 $ 274,208 $ 274,308 Net loss............................................ -- (204,290) (204,290) ------ --------- ------------- Balances, December 31, 1995................................... 100 69,918 70,018 Net income (unaudited).............................. -- 392,136 392,136 ------ --------- ------------- Balances, March 31, 1996 (unaudited).......................... $100 $ 462,054 $ 462,154 ====== ========= =========
See accompanying notes to financial statements. ROSENBERG AND KALMAN, M.D., P.A. STATEMENTS OF CASH FLOWS
FOR THE THREE-MONTH YEAR ENDED PERIOD ENDED DECEMBER 31, MARCH 31, 1995 1996 ------------ ------------ (UNAUDITED) Cash flows from operating activities: Net income (loss)................................................... $ (204,290) $ 392,136 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation..................................................... 22,807 5,262 Loss on disposition of operating asset........................... 10,372 -- Deferred income taxes............................................ (130,340) 236,431 Changes in operating assets and liabilities: Accounts receivable, net....................................... (152,152) (227,068) Supplies....................................................... (3,197) 25,080 Prepaid expenses............................................... (13,069) (1,397) Accounts payable and accrued expenses.......................... 473,217 (390,992) Income tax payable............................................. -- 8,783 Accrued employee compensation.................................. 3,906 (10,004) ------------ ------------ Net cash provided by operating activities................... 7,254 38,231 ------------ ------------ Cash flows from investing activities: Expenditures for furniture and equipment............................ (5,870) -- Proceeds from sale of investments................................... 2,282 -- ------------ ------------ Net cash used in investing activities....................... (3,588) -- ------------ ------------ Cash flows from financing activity: Repayment of debt................................................... (6,189) (1,469) ------------ ------------ Net cash used in financing activity......................... (6,189) (1,469) ------------ ------------ Net increase (decrease) in cash............................. (2,523) 36,762 Cash at beginning of period........................................... 3,267 744 ------------ ------------ Cash at end of period................................................. $ 744 $ 37,506 ========== ========= Supplemental disclosure of cash flow information: Cash payments for interest.......................................... $ 3,203 $ 430 ========== ========= Cash payments for taxes............................................. $ 34,635 $ 1,954 ========== ========= Supplemental schedule of noncash investing and financing activities: Acquisition of automobile........................................... $ 35,841 $ -- ========== ========= Borrowings incurred in connection with acquisition of automobile.... $ 29,971 $ -- ========== =========
See accompanying notes to financial statements. ROSENBERG AND KALMAN, M.D., P.A. NOTES TO FINANCIAL STATEMENTS UNAUDITED INTERIM FINANCIAL INFORMATION The balance sheet as of March 31, 1996 and the related statements of operations, shareholders' equity and cash flows for the three-month period ended March 31, 1996 (1996 interim financial information) have been prepared by Rosenberg and Kalman, M.D., P.A. (the "Company") and are unaudited. In the opinion of the Company, the 1996 interim financial information includes all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the results of the 1996 interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted from the 1996 interim financial information. The 1996 interim financial information should be read in conjunction with the Company's December 31, 1995 audited financial statements appearing herein. The results for the three months ended March 31, 1996 may not be indicative of operating results for the full year. (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (a) Description of Business The Company was incorporated on November 24, 1982 in the state of Florida. The Company is a medical group practice whose physicians specialize in providing services to patients with cancer. (b) Net Revenue Net revenue primarily consists of charges for patient services rendered by the physicians based on established billing rates less allowance and discounts for patients covered by contractual programs. Payments received under these programs, which are generally based on predetermined rates, are generally less than the established billing rates, and the differences are recorded as contractual allowances or policy discounts. Net patient service revenue is net of contractual adjustments and policy discounts of approximately $1,100,000 for the year ended December 31, 1995 and $242,000 for the three-month period ended March 31, 1996 (unaudited). (c) Accounts Receivable Accounts receivable consists primarily of receivables from patients and third-party payors. In the normal course of providing health care services, the Company grants credit to patients, substantially all of whom are residents of the South Florida area. The Company does not generally require collateral or other security in extending credit to patients; however, it routinely obtains assignments of (or is otherwise entitled to receive) patients' benefits payable under their health insurance programs, plans or policies (such as, Medicare, Medicaid, health maintenance organizations, preferred provider organizations and commercial insurance policies). The majority of the Company's net revenue and receivables is from third-party payment programs. At December 31, 1995, approximately 97 percent of total revenue and receivables consists of amounts from Medicare (26 percent), various commercial plans (37 percent) and private pay patients (34 percent). (d) Supplies Supplies consist of pharmaceuticals and medications which are stated at the lower of cost or market on a first-in, first-out basis. ROSENBERG AND KALMAN, M.D., P.A. NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) (e) Property and Equipment Property and equipment are stated at cost. Depreciation for equipment is calculated using the straight-line method over the estimated useful lives of the assets, as follows:
ESTIMATED USEFUL LIVES ------------ Office equipment.............................................. 7 years Medical equipment............................................. 5-7 years Transportation equipment...................................... 5 years
(f) Income Taxes The Company accounts for income taxes under the Financial Accounting Standards Board's Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement 109"). Statement 109 requires the asset and liability method of accounting for income taxes. Under the asset and liability method of Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under Statement 109, 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. (g) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. (2) FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amounts of patients' accounts receivable, investments, accounts payable, notes payable, accrued expenses and accrued employee compensation approximate fair value because of the short maturity of these instruments. (3) EMPLOYEE BENEFIT PLANS The Company has a Qualified Pension and Profit Sharing Plan (the "Plan"), which covers substantially all employees. Employees who complete one year of service and attain age 21 may participate in the Plan. The Company's contributions to the Plan are discretionary and include separate components for annual profit-sharing and retirement benefits. For the year ended December 31, 1995 and the three-month period ended March 31, 1996 (unaudited), the Company did not make any contributions to the Plan. ROSENBERG AND KALMAN, M.D., P.A. NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) (4) DEBT Long-term obligation consists of the following:
DECEMBER 31, MARCH 31, 1995 1996 ------------ ----------- (UNAUDITED) Chase Automotive Finance interest is fixed at 8.5% per annum, due in monthly installments including interest, due December 27, 1998.................................................... $ 29,971 $ 28,502 Less current portion.......................................... (9,990) (10,364) ------------ ----------- $ 19,981 $ 18,138 ========== =========
(5) INCOME TAXES Income tax (benefit) expense for the year ended December 31, 1995 and the three-month period ended March 31, 1996 is as follows:
DECEMBER 31, MARCH 31, 1995 1996 ------------ ----------- (UNAUDITED) Current: Federal..................................................... $ 15,294 $ 7,780 State....................................................... 1,954 1,003 ------------ ----------- 17,248 8,783 ------------ ----------- Deferred: Federal..................................................... (118,276) 203,216 State....................................................... (12,064) 33,215 ------------ ----------- 130,340 236,431 ------------ ----------- $ (113,092) $ 245,214 ========== =========
The tax effects of temporary differences that give rise to a significant portion of the deferred tax assets and deferred tax liabilities at December 31, 1995 and March 31, 1996 are as follows:
DECEMBER 31, MARCH 31, 1995 1996 ------------ ----------- (UNAUDITED) Deferred tax assets: Revenue and expenses recognized for financial reporting purposes in a different period than for income tax purposes................................................. $ 10,188 $ -- ------------ ----------- Deferred tax liabilities: Revenue and expenses recognized for financial reporting purposes in a different period than for income tax purposes................................................. -- (226,243) ------------ ----------- Net deferred tax assets (liabilities)............... $ 10,188 $(226,243) ========== =========
ROSENBERG AND KALMAN, M.D., P.A. NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) A reconciliation of the effective income tax rate is as follows:
DECEMBER 31, MARCH 31, 1995 1996 ------------ ----------- (UNAUDITED) Computed "expected" tax expense (benefit)..................... (35.00)% 35.00% State income tax, net of federal benefit...................... (3.57) 3.47 Permanent adjustments......................................... 2.94 -- ------------ ----------- (35.63)% 38.47% ========== =========
(6) COMMITMENTS AND CONTINGENCIES (a) Leases The Company leases its operating facilities and certain transportation equipment on a month-to-month basis. Total rental expense for operating leases was $68,194 for the year ended December 31, 1995 and $14,813 for the three-month period ended March 31, 1996. (b) Medical Malpractice and Professional Liability Insurance The Company maintains professional liability insurance on a claims-made basis at $500,000 per claim and $1,500,000 in the aggregate. Incidents and claims reported during the policy period are anticipated to be covered by the malpractice carrier. At December 31, 1995, there are no asserted claims against the Company, nor has the Company identified any incident which may have occurred but has yet to be identified under its incident-reporting system. Accordingly, the Company has made no accruals at December 31, 1995 and March 31, 1996 (unaudited) for claims incurred but not reported. SEAFIELD CAPITAL CORPORATION AND SUBSIDIARIES Unaudited Pro Forma Consolidated Financial Information Basis of Presentation The accompanying pro forma consolidated balance sheet as of June 30,1996 and the related pro forma consolidated statements of operations for the year ended December 31, 1995 and the six months ended June 30, 1996 give effect to the acquisitions by Response Oncology, Inc.(Response), a 55% owned subsidiary of Seafield Capital Corporation (Seafield), of Rosenberg & Kalman, M.D., P.A. (the Tamarac Practice), Rymer, Zaravinos & Faig, M.D., P.A. (d/b/a/ Southeast Florida Hematology Oncology Group, P.A.) (Fort Lauderdale practice), Jeffrey L. Paonessa, M.D., P.A. (Paonessa), Knoxville Hematology Oncology Associates (KHOA) and Oncology Hematology Group of South Florida, P.A. (OHGSF), (collectively referred to as the "Groups") as if the acquisitions of the Groups had occurred on January 1, 1995. The pro forma information is based on the historical audited financial statements of Seafield and the Groups, giving effect to the acquisitions under the purchase method of accounting, and the assumptions and adjustments described in the accompanying notes to the pro forma consolidated financial information. The pro forma statements have been prepared by Seafield's management based on the audited financial statements of the Groups. These pro forma statements may not be indicative of the results that would have occurred if the acquisitions had been in effect on the dates indicated or which may be obtained in the future. The pro forma statements do not reflect the effect of expense reductions and other operational changes, which, in the opinion of Response, is likely to result in profitable operations for the Groups. The pro forma financial statements should be read in conjunction with the consolidated financial statements and notes of Seafield. SEAFIELD CAPITAL CORPORATION AND SUBSIDIARIES Pro Forma Consolidated Balance Sheet June 30, 1996 (Unaudited)
Historical Previous Pro forma Tamarac Pro Forma Total Company Acquisitions Adjustments Subtotal Practice Adjustments Pro Forma ---------------------------------------------------------------------------------------- (in thousands) ASSETS Current assets: Cash and cash equivalents $ 6,274 36 (36) 6,274 41 (41) 6,274 Short-term investments 65,752 65,752 65,752 Accounts and notes receivable 28,911 625 135 29,671 722 228 30,621 Current income tax receivable 5,407 5,407 5,407 Deferred income taxes 1,130 (69) 69 1,130 1,130 Other current assets 11,040 179 (74) 11,145 150 (24) 11,271 ------------------------------------------------------------------------------------- Total current assets 118,514 771 94 119,379 913 163 120,455 Property, plant and equipment 22,256 19 22,275 82 (33) 22,324 Investments: Securities 7,220 7,220 7,220 Oil and gas 2,453 2,453 2,453 Intangible assets 61,429 11,234 72,663 15,685 88,348 Other assets 975 975 19 (19) 975 Net assets of discontinued real estate operations 37,648 37,648 37,648 ------------------------------------------------------------------------------------- $ 250,495 771 11,347 262,613 1,014 15,796 279,423 ===================================================================================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 7,277 394 (197) 7,474 366 4 7,844 Notes payable 636 250 (250) 636 10 (10) 636 Other current liabilities 7,899 7,899 10 469 8,378 ------------------------------------------------------------------------------------- Total current liabilities 15,812 644 (447) 16,009 386 463 16,858 Notes payable 23,378 6,443 29,821 17 9,983 39,821 Deferred income taxes 2,851 4,299 7,150 5,961 13,111 Other liabilities 2,440 2,440 2,440 ------------------------------------------------------------------------------------- Total liabilities 44,481 644 10,295 55,420 403 16,407 72,230 ------------------------------------------------------------------------------------- Minority interests 23,033 1,179 24,212 24,212 ------------------------------------------------------------------------------------- Stockholders' equity: Preferred stock of $1 par value. Authorized 3,000,000 shares; none issued -- -- -- Common stock of $1 par value. Authorized 24,000,000 shares; issued 7,500,000 shares 7,500 1 (1) 7,500 7,500 Paid-in capital 1,763 1,763 1,763 Equity adjustment from foreign (466) (466) (466) currency translation Retained earnings 204,287 126 (126) 204,287 611 (611) 204,287 ------------------------------------------------------------------------------------- 213,084 127 (127) 213,084 611 (611) 213,084 Less: Cost of 1,017,924 shares of treasury stk 30,103 30,103 30,103 ------------------------------------------------------------------------------------- Total stockholders' equity 182,981 127 (127) 182,981 611 (611) 182,981 ------------------------------------------------------------------------------------- $ 250,495 771 11,347 262,613 1,014 15,796 279,423 =====================================================================================
See accompanying notes to pro forma consolidated financial information. SEAFIELD CAPITAL CORPORATION AND SUBSIDIARIES Pro Forma Consolidated Statements of Operations Six months ended June 30, 1996 (Unaudited)
Historical Previous Pro Forma Tamarac Pro Forma Total Company Acquisitions Adjustments Subtotal Practice Adjustments Pro Forma ----------------------------------------------------------------------------------------- (in thousands) REVENUES Healthcare services $ 31,981 8,741 (3,167)a,b 37,555 2,191 (646) a,b 39,100 Insurance services 24,505 24,505 24,505 Other 1,086 1,086 1,086 --------------------------------------------------------------------------------------- Total revenues 57,572 8,741 (3,167) 63,146 2,191 (646) 64,691 COSTS AND EXPENSES Healthcare services 28,419 6,077 (1,545)a,d 32,951 1,650 (516) a,d 34,085 Insurance services 10,864 10,864 10,864 Other 1,241 1,241 1,241 Selling, general, administrative 17,431 17,431 17,431 --------------------------------------------------------------------------------------- Earnings (loss) from operations (383) 2,664 (1,622) 659 541 (130) 1,070 Investment income - net 2,415 2,415 2,415 Interest expense (471) (32) (397) c (900) (333) c (1,233) Other income/(loss) 247 79 (79) 247 247 --------------------------------------------------------------------------------------- Earnings before income taxes 1,808 2,711 (2,098) 2,421 541 (463) 2,499 Income taxes 891 891 891 --------------------------------------------------------------------------------------- Earnings before minority interest 917 2,711 (2,098) 1,530 541 (463) 1,608 Minority interest 845 845 845 --------------------------------------------------------------------------------------- NET EARNINGS (LOSS) $ 72 2,711 (2,098) 685 541 (463) 763 =======================================================================================
See accompanying notes to pro forma consolidated financial information. SEAFIELD CAPITAL CORPORATION AND SUBSIDIARIES Pro Forma Consolidated Statements of Operations Twelve Months ended December 31, 1995 (Unaudited)
Historical Previous Pro Forma Tamarac Pro Forma Total Company Acquisitions Adjustments Subtotal Practice Adjustments Pro Forma ----------------------------------------------------------------------------------------- (in thousands) REVENUES Healthcare services $ 56,410 27,550 (9,306)a,b 74,654 4,197 (1,238)a,b 77,613 Insurance services 55,862 55,862 55,862 Other 7,272 7,272 7,272 --------------------------------------------------------------------------------------- Total revenues 119,544 27,550 (9,306) 137,788 4,197 (1,238) 140,747 COSTS AND EXPENSES Healthcare services 52,838 21,242 (4,860)a,d 69,220 4,514 (1,929)a,d 71,805 Insurance services 23,598 23,598 23,598 Other 6,357 6,357 6,357 Selling, general, administrative 42,300 42,300 42,300 --------------------------------------------------------------------------------------- Earnings (loss) from operations (5,549) 6,308 (4,446) (3,687) (317) 691 (3,313) Investment income - net 4,401 4,401 4,401 Interest expense (124) (269) (1,929) c (2,322) (665) (2,987) Other income/(loss) (4,564) 352 (352) (4,564) (4,564) --------------------------------------------------------------------------------------- Earnings (loss) before income taxes (5,836) 6,391 (6,727) (6,172) (317) 26 (6,463) Income taxes (6,563) 262 (262) e (6,563) (113) 113 (6,563) --------------------------------------------------------------------------------------- Earnings before minority interest 727 6,129 (6,465) 391 (204) (87) 100 Minority interest 1,475 1,475 1,475 --------------------------------------------------------------------------------------- EARNINGS (LOSS) FROM CONTINUING OPERATIONS $ (748) 6,129 (6,465) (1,084) (204) (87) (1,375) =======================================================================================
See accompanying notes to pro forma consolidated financial information. SEAFIELD CAPITAL CORPORATION AND SUBSIDIARIES Notes to Pro Forma Consolidated Financial Information The accompanying pro forma consolidated financial information presents the pro forma financial condition of Seafield Capital Corporation and subsidiaries (Seafield) as of June 30, 1996 and the results of their operations for the year ended December 31, 1995 and the six months ended June 30, 1996. On September 3, 1996, Seafield's 55% owned subsidiary, Response Oncology, Inc. (Response), acquired from unaffiliated individual sellers 100% of the issued and outstanding common stock of Rosenberg & Kalman, M.D., P.A. (the Tamarac Practice). The accompanying pro forma consolidated balance sheet includes the acquired assets, assumed liabilities and effects of financing as if the Tamarac practice had been acquired on June 30, 1996. The accompanying pro forma consolidated statements of operations reflect the pro forma results of operations, as adjusted, as if all acquisition practices held by Response had been acquired on January 1, 1995. PRO FORMA CONSOLIDATED BALANCE SHEET The adjustments reflected in the pro forma consolidated balance sheet are to reflect the fair values of assets acquired and liabilities assumed in connection with the acquisition of the Tamarac practice, to reflect the issuance of long-term debt and cash payment to complete the acquisition; and to reflect the recording of management service agreements acquired. PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS The adjustments reflected in the pro forma consolidated statements of operations are as follows: (a) To eliminate certain revenues and expenses that would not constitute revenue to Response or be the responsibility of Response pursuant to the service agreements. (b) To accrue net revenue resulting from service agreements related to the acquisition of the practices. Amounts were calculated based upon actual operating results for the period, as adjusted, under the terms of the related service agreements. (c) To reflect interest on the long-term debt issued. Interest was calculated at the annual rates ranging from 5% to 9.5%. (d) To record amortization of the intangible asset related to the service agreements. The assets are amortized over the service agreement period (40 years). (e) To remove the effect of federal income taxes as Response would have utilized tax net operating loss carryforwards to fully offset the acquired practice's 1995 taxable income. 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 officer. Seafield Capital Corporation Date: November 13, 1996 By: /s/ Steven K. Fitzwater --------------------------- Steven K. Fitzwater Vice President, Chief Accounting Officer and Secretary -----END PRIVACY-ENHANCED MESSAGE-----