bukhaly
عضو نشط
- التسجيل
- 21 يناير 2003
- المشاركات
- 763
مرحبا اخوي الشعثاني ممكن تشوف لي هل بيانات للشركة وتعطيني المختصر المفيد والبيانات ايجابيه ولا سلبيه وشاكرلك مقدما والله يجعله ابميزان حسناتك
والخبر ابتاريخ اليوم وهذا هو
Show all filings for BANYAN CORP /OR/ | Request a Trial to NEW EDGAR Online Pro
Form 8-K/A for BANYAN CORP /OR/
--------------------------------------------------------------------------------
4-Dec-2006
Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
The financial statements of Premier, pro forma financial information, and exhibits required by this item with respect to the acquisition of Premier previously reported in the Registrant's Current Report on Form 8-K filed on February 15, 2006 are filed herewith.
(c) Exhibits
Exhibit Number
F-1 Financial statements required by Rule 3-05 of Regulation S-X
F-14 Pro forma financial information required by Rule 11-02 of Regulation S-X
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
For The Years Ended December 31, 2005 and 2004
F-1
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INDEPENDENT AUDITORS' REPORT
Board of Directors
Premier Medical Group, Inc. and Subsidiaries Boca Raton, Florida
We have audited the accompanying consolidated balance sheets of Premier Medical Group, Inc. and Subsidiaries (an S corporation) as of December 31, 2005 and 2004, and the related consolidated statements of operations, changes in stockholder's equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Premier Medical Group, Inc. and Subsidiaries as of December 31, 2005 and 2004, and the results of its consolidated operations and cash flows for the years then ended, in conformity with generally accepted accounting principles of the United States of America.
The consolidated supplementary information contained on page 11 is presented for purposes of additional analysis and, although not required for a fair presentation of consolidated financial position, consolidated results of operations, and consolidated cash flows, was subjected to the audit procedures applied in the audit of the basic consolidated financial statements. In our opinion, the accompanying consolidated supplementary information is fairly stated in all material respects in relation to the basic consolidated financial statements taken as a whole and should be read in conjunction with those statements.
The Company, with the consent of its stockholder, has elected under the Internal Revenue Code to be an S corporation. In lieu of corporation income taxes, the stockholder of an S corporation is taxed on the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in these consolidated financial statements.
Friedman, Cohen, Taubman & Company, LLC Certified Public Accountants
November 16, 2006
Plantation, Florida
F-2
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TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT F-2
FINANCIAL STATEMENTS:
Consolidated Balance Sheets F-4
Consolidated Statements of Operations F-5
Consolidated Statements of Changes in F-6
Stockholder's Equity
Consolidated Statements of Cash Flows F-7 - F-8
Notes to Consolidated Financial Statements F-9 - F-12
Supplementary Information - Consolidated F-13
Operating Expenses
F-3
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
December 31, 2005 2004
ASSETS
CURRENT ASSETS
Cash and equivalents $ 145,112 $ -
Accounts receivable (Note 2) 1,488,561 1,900,846
Due from affiliates 9,000 -
Due from stockholder 30,966 -
TOTAL CURRENT ASSETS 1,673,639 1,900,846
PROPERTY AND EQUIPMENT, NET (NOTE 3) 85,616 84,228
OTHER ASSETS 3,631 3,631
TOTAL ASSETS $ 1,762,886 $ 1,988,705
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
Bank overdraft $ - $ 57,271
Accrued liabilities 131,294 176,010
Due to stockholder - 213,015
TOTAL CURRENT LIABILITIES 131,294 446,296
TOTAL LIABILITIES 131,294 446,296
COMMITMENTS AND CONTINGENCIES (NOTE 6)
STOCKHOLDER'S EQUITY 1,631,592 1,542,409
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 1,762,886 $ 1,988,705
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-4
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
For The Years Ended December 31, 2005 2004
REVENUES $ 5,422,389 $ 5,359,119
OPERATING EXPENSES
Employee costs 2,452,777 2,586,593
General and administrative expenses 924,356 1,221,759
Selling expenses 1,152,903 1,398,783
TOTAL OPERATING EXPENSES 4,530,036 5,207,135
INCOME BEFORE OTHER INCOME (EXPENSES) 892,353 151,984
OTHER INCOME (EXPENSES)
Interest 1,279 345
Insurance settlement - (1,000,000 )
Depreciation (5,449 ) (4,881 )
TOTAL OTHER INCOME (EXPENSES) (4,170 ) (1,004,536 )
NET INCOME (LOSS) $ 888,183 $ (852,552 )
See accompanying notes to the consolidated financial statements and independent auditors' report
F-5
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PREMIER MEDICAL GROUP, INC. AND
SUBSIDIARIES
Consolidated Statements of Changes in Stockholder's Equity
For The Years Ended December 31,
2005 and 2004
Shares of
Common Total
$10 par value; 100 shares Stock Common Retained Stockholder's
authorized,
51 shares issued and outstanding Issued Stock Earnings Equity
BALANCE AT DECEMBER 31, 2003 51 $ 510 $ 2,523,951 $ 2,524,461
NET (LOSS) - (852,552 ) (852,552 )
DISTRIBUTIONS - (129,500 ) (129,500 )
BALANCE AT DECEMBER 31, 2004 51 510 1,541,899 1,542,409
NET INCOME - 888,183 888,183
DISTRIBUTIONS - (799,000 ) (799,000 )
BALANCE AT DECEMBER 31, 2005 51 $ 510 $ 1,631,082 $ 1,631,592
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-6
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For The Years Ended December 31, 2005 2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts
Cash received from insurance companies and $ 5,835,953 $ 5,815,501
others
5,835,953 5,815,501
Disbursements
Cash paid to suppliers and others 4,614,718 6,050,834
4,614,718 6,050,834
NET CASH PROVIDED BY (USED FOR) OPERATING 1,221,235 (235,333 )
ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES:
Disbursements
Capital expenditures 6,837 1,230
6,837 1,230
NET CASH USED FOR INVESTING ACTIVITIES (6,837 ) (1,230 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Receipts
Loan received from stockholder - 213,015
Increase in bank overdraft - 57,271
- 270,286
Disbursements
Decrease in bank overdraft 57,271 -
Repayment of stockholder loan 213,015 -
Stockholder distributions 799,000 129,500
1,069,286 129,500
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES (1,069,286 ) 140,786
NET INCREASE (DECREASE) IN CASH 145,112 (95,777 )
CASH AND EQUIVALENTS - BEGINNING OF THE YEAR - 95,777
CASH AND EQUIVALENTS - END OF THE YEAR $ 145,112 $ -
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-7
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Continued)
For The Years Ended December 31, 2005 2004
RECONCILIATION OF NET INCOME (LOSS) TO NET CASH
PROVIDED BY (USED FOR) OPERATING ACTIVITIES:
Net income (loss) $ 888,183 $ (852,552 )
Adjustments to reconcile net income (loss) to net cash
provided by (used for) operating activities:
Depreciation and amortization 5,449 4,881
893,632 (847,671 )
Changes in assets and liabilities:
Decrease in accounts receivable 412,285 456,037
Increase in due from stockholder (39,966 ) -
Increase (decrease) in accrued liabilities 44,716 ) 156,301
Total changes in assets and liabilities 327,603 612,338
NET CASH PROVIDED BY (USED FOR) OPERATING
ACTIVITIES $ 1,221,235 $ (235,333 )
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-8
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Activity
Premier Medical Group, Inc. was incorporated in the state of Florida on July 16, 1993. The Company conducts a diagnostic imaging business which offers Nerve Conduction Velocity ("NCV") testing through various clinics and other health care professionals to their clients. Principles of Consolidation
The consolidated financial statements include the accounts of Premier Medical Group, Inc. and its wholly-owned subsidiaries Premier Professional Services, LLC, Atlas Medical Group, Inc., Prism Diagnostics, Inc, Comprehensive Medical Group, Inc., Optimal Medical Group, LLC, Neurological Medical Associates of N.J., LLC, Providers Medical Group, LLC, Neurological Consultants, LLC, Neurological Services, Inc. and West Center Medical Group, Inc.. All material inter-company balances and transactions have been eliminated in the consolidated financial statements. Basis of Presentation
The Company's policy is to prepare the financial statements on the accrual basis of accounting in conformity with generally accepted accounting principles. Revenues are recognized in the period in which they are earned. Expenses are recognized in the period in which they are incurred.
Cash and Equivalents
Cash and equivalents consist of time deposits and all liquid instruments with maturities of three months or less. Accounts Receivable
Substantially all of the accounts receivable are due from third party payors such as insurance companies. Accounts receivable have been recorded at their established charges and reduced by the estimated contractual adjustments and uncollectible accounts. Contractual adjustments result from the differences between the rates charged for services performed and reimbursements by third party payors. The Company considers the terms of the payor contracts in effect and historical collections to calculate the allowance for contractual adjustments and uncollectible accounts. Receivables are generally collected within industry norms from the third party payors however, the services provided and related reimbursements are subject to changes that could result in collections that differ from the estimates. Fixed Assets
Property and equipment is recorded at cost, less accumulated depreciation. Expenditures for major betterments and improvements that extend the lives of the assets are capitalized, while repairs and maintenance that do not improve or extend the lives of the assets are charged to expense currently. Depreciation is provided principally on accelerated methods over the estimated useful lives of the assets which are as follows:
Office furniture and fixtures 5 to 7 years Computer software 3 years Computer and testing equipment 5 to 7 years Transportation equipment 5 years Other 5 years
F-9
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NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Long-Lived Assets
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses are recognized based on the excess of the asset's carrying amount and fair value less costs to sell.
Revenue Recognition
Revenue from diagnostic imaging services consists of net patient fees for service revenue. Net patient service revenue is recognized when diagnostic imaging services are rendered. Net patient service revenue is recorded net of contractual adjustments and other arrangements for providing services at less than established patient billing rates. Allowances for contractual adjustments and uncollectible accounts are provided for accounts receivable based on estimated collection rates. The Company estimates contractual allowances based on differences between the rates charged for services performed and reimbursements by third party payors. The Company adjusts the contractual allowance rates, as changes to the factors discussed above become known. As these factors change, the historical collection experience is revised accordingly in the period known. These allowances are reviewed periodically and adjusted based on historical payment rates. Depending on the changes made in the contractual allowance rates, net revenue may increase or decrease.
Income Taxes
The Company, with the consent of its stockholder, has elected under the Internal Revenue Code to be an S corporation. In lieu of corporation income taxes, the stockholder of an S corporation is taxed on the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in these financial statements 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 revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used when accounting for allowance for doubtful accounts, contractual allowances, depreciation, accrued liabilities, and contingencies.
NOTE 2. ACCOUNTS RECEIVABLE
Accounts receivable at December 31, consists of: 2005 2004
Accounts receivable $ 9,143,493 $ 11,675,956
Less allowance for contractual adjustments and
uncollectible accounts (7,654,932 ) (9,775,110 )
$ 1,488,561 $ 1,900,846
F-10
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NOTE 3. PROPERTY AND EQUIPMENT
Property and equipment, which is stated at cost, at December 31,
consists of the following:
2005 2004
Computer software $ 13,362 $ 13,362
Office furniture and fixtures 23,065 23,065
Computer and testing equipment 73,957 67,120
Transportation equipment 98,862 98,862
Other 1,230 1,230
210,476 203,639
Less accumulated depreciation (124,860 ) (119,411 )
$ 85,616 $ 84,228
Depreciation expense for the years ended December 31, 2005 and 2004 amounted to $5,449 and $4,881, respectively.
NOTE 4. The Company is related to several other entities through common
ownership and control. The Company received management fees from Premier Health Services LLC (an unconsolidated affiliate owned by Dena Goldstein) during the years ended December 31, 2005 and 2004 that amounted to $1,545,000 and $495,000, respectively. This amount is included in revenues in these consolidated financial statements in the years earned.
NOTE 5. SUBSEQUENT EVENT
On February 10, 2006, the stockholder of the Company sold all of his outstanding capital stock to Banyan Corporation. Effective as of the date of sale, the principal operating stockholder entered into a one-year employment agreement with the acquiring company.
NOTE 6. COMMITMENTS AND CONTINGENCIES
Pending or Threatened Litigation or Claims
The Company is subject to legal proceedings and other claims that arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability, if any, in excess of applicable insurance coverage, is not likely to have a material effect on the financial condition, results of operations or liquidity of the Company. However, the outcome of litigation or other legal claims is difficult to predict and significant changes in the estimated exposures could occur.
Lease Commitments
The Company has three separate operating lease agreements for office facilities. The leases expire on October 31, 2006. Monthly rent payments amount to $6,128. The future minimum rent payment due is $61,280 for the year 2006.
Total rent expense for the years ended December 31, 2005 and 2004, amounted to $148,202 and $145,166, respectively.
F-11
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NOTE 6. COMMITMENTS AND CONTINGENCIES (CONTINUED)
State Income Taxes
The Company does not file tax returns with any state taxing authority other than Florida and California. It is management's opinion that the Company is not required to file returns in other states. In the event that the states, in which payroll exist, determine the Company has nexus, the potential liabilities from 2002 through December 31, 2005 would be approximately $18,000.
F-12
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Supplementary Information - Consolidated Operating Expenses
For The Years Ended December 31, 2005 2004
EMPLOYEE COSTS
Salaries and wages $ 1,974,396 $ 2,125,044
Payroll taxes 152,404 152,970
Employee auto reimbursement 258,093 259,941
Employee benefits 14,621 8,886
Insurance - life, health and disability 43,175 27,731
Workers' compensation insurance 10,088 12,021
TOTAL EMPLOYEE COSTS 2,452,777 2,586,593
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and promotion 20,632 63,388
Automobile 41,154 33,565
Bank charges 7,228 7,738
Billing service 17,096 -
Computer supply 24,065 10,338
Contributions 300 8,750
Credit card fees 1,926 1,633
Equipment rental 53,309 89,369
Insurance 7,450 12,001
Legal and professional fees 324,385 507,380
Licenses and taxes 8,434 1,752
Meals and entertainment 46,631 40,242
Medical supplies 33,335 38,782
Office supplies 12,443 11,177
Other 9,447 36,020
Postage and courier service 96,328 116,807
Rent 148,202 145,166
Repairs and maintenance 1,961 14,236
Telephone 70,030 83,415
TOTAL GENERAL AND ADMINISTRATIVE 924,356 1,221,759
EXPENSES
SELLING EXPENSES
Travel 571,998 649,051
Neurological interpretation fees 211,654 264,914
Sales commission 369,251 484,818
TOTAL SELLING EXPENSES 1,152,903 1,398,783
TOTAL OPERATING EXPENSES $ 4,530,036 $ 5,207,135
See independent auditors' report.
F-13
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BANYAN CORPORATION
UNAUDITED CONDENSED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
Attached hereto is the unaudited condensed pro forma consolidated balance sheet as of December 31, 2005 and the unaudited condensed pro forma consolidated statement of operations for the year ended December 31, 2005 reflecting the acquisition of Premier Medical Group, Inc. and its subsidiaries and affiliates, and including the notes to the unaudited pro forma financial statements.
On February 10, 2006, Banyan Corporation, (the "Company") purchased all of the outstanding equity securities of the constituent entities of a diagnostic imaging business, Premier Medical Group, Inc and its subsidiaries and affiliates ("PMG") in exchange for $2,000,000 in cash at closing, 14,285,714 shares of common stock valued at $142,857payable of $100,000 plus an amount equal to the pre-closing accounts receivable that are actually collected, estimated at $2,020,000. The accompanying unaudited condensed pro forma consolidated balance sheet gives effect to the acquisition as if the purchase had been consummated on December 31, 2005. The accompanying unaudited condensed pro forma consolidated statement of operations for the year ended December 31, 2005, gives effect to the acquisition as if the purchase had been consummated on January 1, 2005. The historical financial statements of PMG (included herein) are as of and for the years ended December 31, 2005 and 2004.
The unaudited condensed pro forma consolidated financial statements should be read in conjunction with the historical financial statements of PMG (included herein) as well as those of the Company. The unaudited condensed pro forma consolidated financial statements do not purport to be indicative of the financial position or results of operations that actually would have occurred had either transaction occurred before February 10, 2006 or to project the Company's financial position or results of operations to any future period.
F-14
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والخبر ابتاريخ اليوم وهذا هو
Show all filings for BANYAN CORP /OR/ | Request a Trial to NEW EDGAR Online Pro
Form 8-K/A for BANYAN CORP /OR/
--------------------------------------------------------------------------------
4-Dec-2006
Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
The financial statements of Premier, pro forma financial information, and exhibits required by this item with respect to the acquisition of Premier previously reported in the Registrant's Current Report on Form 8-K filed on February 15, 2006 are filed herewith.
(c) Exhibits
Exhibit Number
F-1 Financial statements required by Rule 3-05 of Regulation S-X
F-14 Pro forma financial information required by Rule 11-02 of Regulation S-X
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
For The Years Ended December 31, 2005 and 2004
F-1
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INDEPENDENT AUDITORS' REPORT
Board of Directors
Premier Medical Group, Inc. and Subsidiaries Boca Raton, Florida
We have audited the accompanying consolidated balance sheets of Premier Medical Group, Inc. and Subsidiaries (an S corporation) as of December 31, 2005 and 2004, and the related consolidated statements of operations, changes in stockholder's equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Premier Medical Group, Inc. and Subsidiaries as of December 31, 2005 and 2004, and the results of its consolidated operations and cash flows for the years then ended, in conformity with generally accepted accounting principles of the United States of America.
The consolidated supplementary information contained on page 11 is presented for purposes of additional analysis and, although not required for a fair presentation of consolidated financial position, consolidated results of operations, and consolidated cash flows, was subjected to the audit procedures applied in the audit of the basic consolidated financial statements. In our opinion, the accompanying consolidated supplementary information is fairly stated in all material respects in relation to the basic consolidated financial statements taken as a whole and should be read in conjunction with those statements.
The Company, with the consent of its stockholder, has elected under the Internal Revenue Code to be an S corporation. In lieu of corporation income taxes, the stockholder of an S corporation is taxed on the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in these consolidated financial statements.
Friedman, Cohen, Taubman & Company, LLC Certified Public Accountants
November 16, 2006
Plantation, Florida
F-2
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TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT F-2
FINANCIAL STATEMENTS:
Consolidated Balance Sheets F-4
Consolidated Statements of Operations F-5
Consolidated Statements of Changes in F-6
Stockholder's Equity
Consolidated Statements of Cash Flows F-7 - F-8
Notes to Consolidated Financial Statements F-9 - F-12
Supplementary Information - Consolidated F-13
Operating Expenses
F-3
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
December 31, 2005 2004
ASSETS
CURRENT ASSETS
Cash and equivalents $ 145,112 $ -
Accounts receivable (Note 2) 1,488,561 1,900,846
Due from affiliates 9,000 -
Due from stockholder 30,966 -
TOTAL CURRENT ASSETS 1,673,639 1,900,846
PROPERTY AND EQUIPMENT, NET (NOTE 3) 85,616 84,228
OTHER ASSETS 3,631 3,631
TOTAL ASSETS $ 1,762,886 $ 1,988,705
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
Bank overdraft $ - $ 57,271
Accrued liabilities 131,294 176,010
Due to stockholder - 213,015
TOTAL CURRENT LIABILITIES 131,294 446,296
TOTAL LIABILITIES 131,294 446,296
COMMITMENTS AND CONTINGENCIES (NOTE 6)
STOCKHOLDER'S EQUITY 1,631,592 1,542,409
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 1,762,886 $ 1,988,705
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-4
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
For The Years Ended December 31, 2005 2004
REVENUES $ 5,422,389 $ 5,359,119
OPERATING EXPENSES
Employee costs 2,452,777 2,586,593
General and administrative expenses 924,356 1,221,759
Selling expenses 1,152,903 1,398,783
TOTAL OPERATING EXPENSES 4,530,036 5,207,135
INCOME BEFORE OTHER INCOME (EXPENSES) 892,353 151,984
OTHER INCOME (EXPENSES)
Interest 1,279 345
Insurance settlement - (1,000,000 )
Depreciation (5,449 ) (4,881 )
TOTAL OTHER INCOME (EXPENSES) (4,170 ) (1,004,536 )
NET INCOME (LOSS) $ 888,183 $ (852,552 )
See accompanying notes to the consolidated financial statements and independent auditors' report
F-5
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PREMIER MEDICAL GROUP, INC. AND
SUBSIDIARIES
Consolidated Statements of Changes in Stockholder's Equity
For The Years Ended December 31,
2005 and 2004
Shares of
Common Total
$10 par value; 100 shares Stock Common Retained Stockholder's
authorized,
51 shares issued and outstanding Issued Stock Earnings Equity
BALANCE AT DECEMBER 31, 2003 51 $ 510 $ 2,523,951 $ 2,524,461
NET (LOSS) - (852,552 ) (852,552 )
DISTRIBUTIONS - (129,500 ) (129,500 )
BALANCE AT DECEMBER 31, 2004 51 510 1,541,899 1,542,409
NET INCOME - 888,183 888,183
DISTRIBUTIONS - (799,000 ) (799,000 )
BALANCE AT DECEMBER 31, 2005 51 $ 510 $ 1,631,082 $ 1,631,592
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-6
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For The Years Ended December 31, 2005 2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts
Cash received from insurance companies and $ 5,835,953 $ 5,815,501
others
5,835,953 5,815,501
Disbursements
Cash paid to suppliers and others 4,614,718 6,050,834
4,614,718 6,050,834
NET CASH PROVIDED BY (USED FOR) OPERATING 1,221,235 (235,333 )
ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES:
Disbursements
Capital expenditures 6,837 1,230
6,837 1,230
NET CASH USED FOR INVESTING ACTIVITIES (6,837 ) (1,230 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Receipts
Loan received from stockholder - 213,015
Increase in bank overdraft - 57,271
- 270,286
Disbursements
Decrease in bank overdraft 57,271 -
Repayment of stockholder loan 213,015 -
Stockholder distributions 799,000 129,500
1,069,286 129,500
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES (1,069,286 ) 140,786
NET INCREASE (DECREASE) IN CASH 145,112 (95,777 )
CASH AND EQUIVALENTS - BEGINNING OF THE YEAR - 95,777
CASH AND EQUIVALENTS - END OF THE YEAR $ 145,112 $ -
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-7
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Continued)
For The Years Ended December 31, 2005 2004
RECONCILIATION OF NET INCOME (LOSS) TO NET CASH
PROVIDED BY (USED FOR) OPERATING ACTIVITIES:
Net income (loss) $ 888,183 $ (852,552 )
Adjustments to reconcile net income (loss) to net cash
provided by (used for) operating activities:
Depreciation and amortization 5,449 4,881
893,632 (847,671 )
Changes in assets and liabilities:
Decrease in accounts receivable 412,285 456,037
Increase in due from stockholder (39,966 ) -
Increase (decrease) in accrued liabilities 44,716 ) 156,301
Total changes in assets and liabilities 327,603 612,338
NET CASH PROVIDED BY (USED FOR) OPERATING
ACTIVITIES $ 1,221,235 $ (235,333 )
See accompanying notes to the consolidated financial statements and independent auditors' report.
F-8
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Activity
Premier Medical Group, Inc. was incorporated in the state of Florida on July 16, 1993. The Company conducts a diagnostic imaging business which offers Nerve Conduction Velocity ("NCV") testing through various clinics and other health care professionals to their clients. Principles of Consolidation
The consolidated financial statements include the accounts of Premier Medical Group, Inc. and its wholly-owned subsidiaries Premier Professional Services, LLC, Atlas Medical Group, Inc., Prism Diagnostics, Inc, Comprehensive Medical Group, Inc., Optimal Medical Group, LLC, Neurological Medical Associates of N.J., LLC, Providers Medical Group, LLC, Neurological Consultants, LLC, Neurological Services, Inc. and West Center Medical Group, Inc.. All material inter-company balances and transactions have been eliminated in the consolidated financial statements. Basis of Presentation
The Company's policy is to prepare the financial statements on the accrual basis of accounting in conformity with generally accepted accounting principles. Revenues are recognized in the period in which they are earned. Expenses are recognized in the period in which they are incurred.
Cash and Equivalents
Cash and equivalents consist of time deposits and all liquid instruments with maturities of three months or less. Accounts Receivable
Substantially all of the accounts receivable are due from third party payors such as insurance companies. Accounts receivable have been recorded at their established charges and reduced by the estimated contractual adjustments and uncollectible accounts. Contractual adjustments result from the differences between the rates charged for services performed and reimbursements by third party payors. The Company considers the terms of the payor contracts in effect and historical collections to calculate the allowance for contractual adjustments and uncollectible accounts. Receivables are generally collected within industry norms from the third party payors however, the services provided and related reimbursements are subject to changes that could result in collections that differ from the estimates. Fixed Assets
Property and equipment is recorded at cost, less accumulated depreciation. Expenditures for major betterments and improvements that extend the lives of the assets are capitalized, while repairs and maintenance that do not improve or extend the lives of the assets are charged to expense currently. Depreciation is provided principally on accelerated methods over the estimated useful lives of the assets which are as follows:
Office furniture and fixtures 5 to 7 years Computer software 3 years Computer and testing equipment 5 to 7 years Transportation equipment 5 years Other 5 years
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NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Long-Lived Assets
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses are recognized based on the excess of the asset's carrying amount and fair value less costs to sell.
Revenue Recognition
Revenue from diagnostic imaging services consists of net patient fees for service revenue. Net patient service revenue is recognized when diagnostic imaging services are rendered. Net patient service revenue is recorded net of contractual adjustments and other arrangements for providing services at less than established patient billing rates. Allowances for contractual adjustments and uncollectible accounts are provided for accounts receivable based on estimated collection rates. The Company estimates contractual allowances based on differences between the rates charged for services performed and reimbursements by third party payors. The Company adjusts the contractual allowance rates, as changes to the factors discussed above become known. As these factors change, the historical collection experience is revised accordingly in the period known. These allowances are reviewed periodically and adjusted based on historical payment rates. Depending on the changes made in the contractual allowance rates, net revenue may increase or decrease.
Income Taxes
The Company, with the consent of its stockholder, has elected under the Internal Revenue Code to be an S corporation. In lieu of corporation income taxes, the stockholder of an S corporation is taxed on the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in these financial statements 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 revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used when accounting for allowance for doubtful accounts, contractual allowances, depreciation, accrued liabilities, and contingencies.
NOTE 2. ACCOUNTS RECEIVABLE
Accounts receivable at December 31, consists of: 2005 2004
Accounts receivable $ 9,143,493 $ 11,675,956
Less allowance for contractual adjustments and
uncollectible accounts (7,654,932 ) (9,775,110 )
$ 1,488,561 $ 1,900,846
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NOTE 3. PROPERTY AND EQUIPMENT
Property and equipment, which is stated at cost, at December 31,
consists of the following:
2005 2004
Computer software $ 13,362 $ 13,362
Office furniture and fixtures 23,065 23,065
Computer and testing equipment 73,957 67,120
Transportation equipment 98,862 98,862
Other 1,230 1,230
210,476 203,639
Less accumulated depreciation (124,860 ) (119,411 )
$ 85,616 $ 84,228
Depreciation expense for the years ended December 31, 2005 and 2004 amounted to $5,449 and $4,881, respectively.
NOTE 4. The Company is related to several other entities through common
ownership and control. The Company received management fees from Premier Health Services LLC (an unconsolidated affiliate owned by Dena Goldstein) during the years ended December 31, 2005 and 2004 that amounted to $1,545,000 and $495,000, respectively. This amount is included in revenues in these consolidated financial statements in the years earned.
NOTE 5. SUBSEQUENT EVENT
On February 10, 2006, the stockholder of the Company sold all of his outstanding capital stock to Banyan Corporation. Effective as of the date of sale, the principal operating stockholder entered into a one-year employment agreement with the acquiring company.
NOTE 6. COMMITMENTS AND CONTINGENCIES
Pending or Threatened Litigation or Claims
The Company is subject to legal proceedings and other claims that arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability, if any, in excess of applicable insurance coverage, is not likely to have a material effect on the financial condition, results of operations or liquidity of the Company. However, the outcome of litigation or other legal claims is difficult to predict and significant changes in the estimated exposures could occur.
Lease Commitments
The Company has three separate operating lease agreements for office facilities. The leases expire on October 31, 2006. Monthly rent payments amount to $6,128. The future minimum rent payment due is $61,280 for the year 2006.
Total rent expense for the years ended December 31, 2005 and 2004, amounted to $148,202 and $145,166, respectively.
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NOTE 6. COMMITMENTS AND CONTINGENCIES (CONTINUED)
State Income Taxes
The Company does not file tax returns with any state taxing authority other than Florida and California. It is management's opinion that the Company is not required to file returns in other states. In the event that the states, in which payroll exist, determine the Company has nexus, the potential liabilities from 2002 through December 31, 2005 would be approximately $18,000.
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PREMIER MEDICAL GROUP, INC. AND SUBSIDIARIES
Supplementary Information - Consolidated Operating Expenses
For The Years Ended December 31, 2005 2004
EMPLOYEE COSTS
Salaries and wages $ 1,974,396 $ 2,125,044
Payroll taxes 152,404 152,970
Employee auto reimbursement 258,093 259,941
Employee benefits 14,621 8,886
Insurance - life, health and disability 43,175 27,731
Workers' compensation insurance 10,088 12,021
TOTAL EMPLOYEE COSTS 2,452,777 2,586,593
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and promotion 20,632 63,388
Automobile 41,154 33,565
Bank charges 7,228 7,738
Billing service 17,096 -
Computer supply 24,065 10,338
Contributions 300 8,750
Credit card fees 1,926 1,633
Equipment rental 53,309 89,369
Insurance 7,450 12,001
Legal and professional fees 324,385 507,380
Licenses and taxes 8,434 1,752
Meals and entertainment 46,631 40,242
Medical supplies 33,335 38,782
Office supplies 12,443 11,177
Other 9,447 36,020
Postage and courier service 96,328 116,807
Rent 148,202 145,166
Repairs and maintenance 1,961 14,236
Telephone 70,030 83,415
TOTAL GENERAL AND ADMINISTRATIVE 924,356 1,221,759
EXPENSES
SELLING EXPENSES
Travel 571,998 649,051
Neurological interpretation fees 211,654 264,914
Sales commission 369,251 484,818
TOTAL SELLING EXPENSES 1,152,903 1,398,783
TOTAL OPERATING EXPENSES $ 4,530,036 $ 5,207,135
See independent auditors' report.
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BANYAN CORPORATION
UNAUDITED CONDENSED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
Attached hereto is the unaudited condensed pro forma consolidated balance sheet as of December 31, 2005 and the unaudited condensed pro forma consolidated statement of operations for the year ended December 31, 2005 reflecting the acquisition of Premier Medical Group, Inc. and its subsidiaries and affiliates, and including the notes to the unaudited pro forma financial statements.
On February 10, 2006, Banyan Corporation, (the "Company") purchased all of the outstanding equity securities of the constituent entities of a diagnostic imaging business, Premier Medical Group, Inc and its subsidiaries and affiliates ("PMG") in exchange for $2,000,000 in cash at closing, 14,285,714 shares of common stock valued at $142,857payable of $100,000 plus an amount equal to the pre-closing accounts receivable that are actually collected, estimated at $2,020,000. The accompanying unaudited condensed pro forma consolidated balance sheet gives effect to the acquisition as if the purchase had been consummated on December 31, 2005. The accompanying unaudited condensed pro forma consolidated statement of operations for the year ended December 31, 2005, gives effect to the acquisition as if the purchase had been consummated on January 1, 2005. The historical financial statements of PMG (included herein) are as of and for the years ended December 31, 2005 and 2004.
The unaudited condensed pro forma consolidated financial statements should be read in conjunction with the historical financial statements of PMG (included herein) as well as those of the Company. The unaudited condensed pro forma consolidated financial statements do not purport to be indicative of the financial position or results of operations that actually would have occurred had either transaction occurred before February 10, 2006 or to project the Company's financial position or results of operations to any future period.
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