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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2002
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 No. 0-20260
IntegraMed America, Inc.
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(Exact name of Registrant as specified in its charter)
Delaware 06-1150326
-------------------------------- ----------------------------------
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
One Manhattanville Road 10577
Purchase, New York
---------------------------------------- --------
(Address of principal executive offices) (Zip code)
(914) 253-8000
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(Registrant's telephone number, including area code)
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 preceding 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 aggregate number of shares of the Registrant's Common Stock, $.01
par value, outstanding on April 23, 2002 was 3,085,516.
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INTEGRAMED AMERICA, INC.
FORM 10-Q
TABLE OF CONTENTS
PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets at March 31, 2002 (unaudited)
and December 31, 2001...................................... 3
Consolidated Statements of Income for the three-month periods
ended March 31, 2002 and 2001 (unaudited).................. 4
Consolidated Statements of Cash Flows for the three-month
periods ended March 31, 2002 and 2001 (unaudited).......... 5
Notes to Consolidated Financial Statements (unaudited)...... 6-7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations............................... 8-12
Item 3. Quantitative and Qualitative Disclosures About Market Risk.......12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings................................................13
Item 2. Changes in Securities............................................13
Item 3. Defaults upon Senior Securities..................................13
Item 4. Submission of Matters to a Vote of Security Holders..............13
Item 5. Other Information................................................13
Item 6. Exhibits and Reports on Form 8-K.................................13
SIGNATURES ........................................................14
-2-
PART I -- FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
INTEGRAMED AMERICA, INC.
CONSOLIDATED BALANCE SHEETS
(all dollars in thousands, except per share amounts)
ASSETS
March 31 December 31,
----------- -----------
2002 2001
----------- -----------
(unaudited)
Current assets:
Cash and cash equivalents ................................................... $ 9,278 $ 8,505
Due from Medical Practices, net ............................................. 4,522 4,949
Pharmaceutical sales accounts receivable .................................... 2,864 1,511
Prepaids and other current assets ........................................... 1,743 1,961
-------- --------
Total current assets .................................................... 18,407 16,926
Fixed assets, net ........................................................... 5,391 5,263
Intangible assets, net ...................................................... 17,503 17,378
Deferred taxes .............................................................. 4,652 4,791
Other assets ................................................................ 239 263
-------- --------
Total assets ............................................................ $ 46,192 $ 44,621
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable ............................................................ $ 1,938 $ 1,436
Accrued liabilities ......................................................... 4,976 5,228
Current portion of long-term notes payable and other obligations ............ 1,332 1,403
Patient deposits ............................................................ 5,938 4,651
-------- --------
Total current liabilities ............................................... 14,184 12,718
-------- --------
Long-term notes payable and other obligations ................................. 1,000 1,288
-------- --------
Shareholders' equity:
Preferred Stock, $1.00 par value - 3,165,644 shares authorized in 2002 and
2001, 2,500,000 undesignated; 665,644 shares designated as Series A
Cumulative Convertible of which 165,644 shares were issued and outstanding
in 2002 and 2001, respectively ............... ............................ 166 166
Common Stock, $.01 par value - 50,000,000 shares authorized in 2002 and 2001;
and 3,080,516 and 3,057,877 shares issued in 2002 and 2001, respectively .. 31 31
Capital in excess of par .................................................... 47,320 47,218
Accumulated deficit ......................................................... (16,509) (16,800)
-------- --------
Total shareholders' equity .............................................. 31,008 30,615
-------- --------
Total liabilities and shareholders' equity .............................. $ 46,192 $ 44,621
======== ========
See accompanying notes to the consolidated financial statements.
-3-
INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENTS OF INCOME
(all amounts in thousands, except per share amounts)
For the
three-month period
ended March 31,
------------------
2002 2001
------------------
(unaudited)
Revenues, net
Reproductive Science Center service fees (including
termination payment of $360,000 in first quarter 2001) ........................... $ 15,825 $ 13,009
Pharmaceutical sales ................................................................ 4,220 3,461
Other revenues ...................................................................... 231 21
-------- --------
Total revenues ................................................................... 20,276 16,491
-------- --------
Cost of services and sales:
Reproductive Science Center costs ................................................... 13,592 10,796
Pharmaceutical costs ................................................................ 4,058 3,323
Other costs ......................................................................... 121 25
-------- --------
Total costs of services and sales ................................................ 17,771 14,144
-------- --------
Contribution:
Reproductive Science Center contribution ............................................ 2,233 2,213
Pharmaceutical contribution ......................................................... 162 138
Other contribution .................................................................. 110 (4)
-------- --------
Total contribution ................................................................ 2,505 2,347
-------- --------
General and administrative expenses .................................................... 1,803 1,689
Amortization of intangible assets ...................................................... 225 216
Interest income ........................................................................ (38) (54)
Interest expense ....................................................................... 38 86
-------- --------
Total other expenses ................................................................ 2,028 1,937
-------- --------
Income before income taxes ............................................................. 477 410
Income tax provision ................................................................... 186 51
-------- --------
Net income ............................................................................. $ 291 $ 359
Less: Dividends paid and/or accrued on Preferred Stock ................................. (33) (33)
-------- --------
Net income applicable to Common Stock .................................................. $ 258 $ 326
======== ========
Basic and diluted earnings per share of Common Stock: .................................. $ 0.08 $ 0.10
======== ========
Weighted average shares - basic ........................................................ 3,061 3,223
======== ========
Weighted average shares - diluted ...................................................... 3,245 3,231
======== ========
See accompanying notes to the consolidated financial statements.
-4-
INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(all amounts in thousands)
For the
three-month period
ended March 31,
-------------------
2002 2001
-------------------
(unaudited)
Cash flows from operating activities:
Net income ........................................................................ $ 291 $ 359
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization ................................................... 635 596
Change in assets and liabilities--
Decrease (increase) in assets:
Due from Medical Practices ................................................... 427 (297)
Pharmaceutical sales accounts receivable ..................................... (1,353) (420)
Business Services fees receivable ............................................ -- 237
Prepaids and other current assets ............................................ 218 114
Other assets ................................................................. 163 --
Increase (decrease) in liabilities:
Accounts payable ............................................................ 502 34
Accrued liabilities ......................................................... (117) (813)
Patient deposits ............................................................ 1,287 1,470
------- -------
Net cash provided by operating activities ............................................ 2,053 1,280
------- -------
Cash flows used in investing activities:
Payment for exclusive Business Service rights ................................... (350) (203)
Purchase of fixed assets and leasehold improvements ............................. (538) (777)
------- -------
Net cash used in investing activities ................................................ (888) (980)
------- -------
Cash flows used in financing activities:
Principal repayments on debt .................................................... (324) (250)
Principal repayments under capital lease obligations ............................ (35) (32)
Repurchase of Common Stock ...................................................... -- (2,029)
Proceeds from exercise of Common Stock Warrants ................................. -- 3
Dividends paid on Convertible Preferred Stock ................................... (33) (33)
------- -------
Net cash used in financing activities ................................................ (392) (2,341)
------- -------
Net increase (decrease) in cash ...................................................... $ 773 $(2,041)
Cash at beginning of period .......................................................... 8,505 5,306
------- -------
Cash at end of period ................................................................ $ 9,278 $ 3,265
======= =======
See accompanying notes to the consolidated financial statements.
-5-
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1 -- INTERIM RESULTS:
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, accordingly, do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the accompanying unaudited interim financial statements contain all
adjustments (consisting only of normal recurring accruals) necessary to present
fairly the financial position at March 31, 2002, and the results of operations
and cash flows for the interim period presented. Operating results for the
interim period are not necessarily indicative of results that may be expected
for the year ending December 31, 2002. These financial statements should be read
in conjunction with the financial statements and notes thereto included in
IntegraMed America's (the "Company") Annual Report on Form 10-K for the year
ended December 31, 2001.
NOTE 2 -- EARNINGS PER SHARE:
The reconciliation of the numerators and denominators of the basic and
diluted EPS from continuing operations computations for the three-month periods
ended March 31, 2002 and 2001 is as follows (000's omitted, except for per share
amounts):
For the
three-month period
ended March 31,
------------------
2002 2001
------- --------
Numerator
Net Income ..................................... $ 291 $ 359
Less: Preferred stock dividends ................ 33 33
------ ------
Income applicable to Common Stock .............. $ 258 $ 326
====== ======
Denominator
Weighted average shares outstanding ............ 3,061 3,223
Effect of dilutive options and warrants ........ 184 8
------ ------
Weighted average shares and dilutive potential
Common shares .................................. 3,245 3,231
====== ======
Basic and diluted EPS .......................... $ 0.08 $ 0.10
====== ======
For the three-month period ended March 31, 2002, the effect of the
assumed exercise of options to purchase approximately 235,000 shares of Common
Stock at exercise prices ranging from $5.38 to $5.98 per share and warrants to
purchase approximately 25,000 shares of Common Stock at exercise prices ranging
from $5.13 to $7.24 per share were excluded in computing the diluted per share
amount because the exercise prices of the options and warrants were greater than
the average market price of the shares of Common Stock, therefore causing these
options and warrants to be antidilutive. For the three-month period ended March
31, 2001, the effect of the assumed exercise of options to purchase
approximately 489,000 shares of common stock at exercises prices ranging from
$3.00 to $5.00 per share and warrants to purchase approximately 103,000 shares
of common stock at exercise prices ranging from $4.12 to 8.54 per share were
excluded in computing the diluted per share amount because the exercise prices
of the options and warrants were greater than the average market price of the
shares of common stock, therefore causing these options and warrants to be
antidilutive.
-6-
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
For the three-month periods ended March 31, 2002 and 2001,
approximately 136,000 and 133,000 shares, respectively, of Common Stock from the
assumed conversion of Preferred Stock were excluded in computing the diluted per
share amount as they were antidilutive.
NOTE 3 -- SEGMENT INFORMATION:
The Company is principally engaged in providing products and services
to the fertility market. For disclosure purposes, the Company recognizes
Business Services offered to its network of Reproductive Science Centers and its
pharmaceutical distribution operations as separate reporting segments. The
Business Services segment includes revenues and costs categorized as
Reproductive Science Center Service Fees and Other Revenue, as follows (000's
omitted):
Business Pharmaceutical
Corporate Services Distribution Consolidated
--------- -------- ------------- ------------
For the three months ended March 31, 2002
Revenues .............................................. $ -- $ 16,056 $ 4,220 $20,276
Cost of services ...................................... -- 13,713 4,058 17,771
------- -------- ------- -------
Contribution .......................................... -- 2,343 162 2,505
------- -------- ------- -------
General and administrative costs ...................... 1,803 -- -- 1,803
Amortization of intangibles ........................... 1 224 -- 225
Interest, net ......................................... (1) 3 (2) --
------- -------- ------- -------
Income before income taxes ............................ $(1,803) $ 2,116 $ 164 $ 477
======= ======== ======= =======
Depreciation expense included above ................... $ 68 $ 342 $ -- $ 410
Capital expenditures .................................. $ 95 $ 443 $ -- $ 538
Total assets .......................................... $ 5,557 $ 37,859 $ 2,776 $46,192
For the three months ended March 31, 2001
Revenues .............................................. $ -- $ 13,030 $ 3,461 $16,491
Cost of services ...................................... -- 10,821 3,323 14,144
------- -------- ------- -------
Contribution .......................................... -- 2,209 138 2,347
General and administrative costs ...................... 1,689 -- -- 1,689
Amortization of intangibles ........................... 1 213 2 216
Interest, net ......................................... 44 (11) (1) 32
------- -------- ------- -------
Income (loss) before income taxes ..................... $(1,734) $ 2,007 $ 137 $ 410
======= ======== ======= =======
Depreciation expense included above ................... $ 106 $ 274 $ -- $ 380
Capital expenditures .................................. $ 57 $ 720 $ -- $ 777
Total assets at December 31, 2000 ..................... $ (868) $ 39,376 $ 1,708 $40,216
NOTE 4 -- SUBSEQUENT EVENT:
Subsequent to March 31, 2002, the Company signed an agreement to supply
a complete range of business, marketing and facility services to the Margate,
Florida-based Northwest Center for Infertility and Reproductive Endocrinology
("NCIRE"). Under the terms of the 15-year agreement, the Company's service fees
will be comprised of reimbursed costs of services and a fixed percentage of
revenues, plus an additional fixed percentage of NCIRE earnings. The Company has
committed up to $2 million to fund the development and equipping of a new
state-of-the-art facility to house the clinical practice and embryology
laboratory for NCIRE and its patients.
-7-
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis should be read in conjunction
with the consolidated financial statements and notes thereto included in this
quarterly report and with the Company's Annual Report on Form 10-K for the year
ended December 31, 2001.
IntegraMed America, Inc. (the "Company") offers products and services
to patients, providers, payors and pharmaceutical manufacturers in the fertility
industry. The IntegraMed Network is comprised of fourteen fertility centers in
major markets across the United States, a pharmaceutical distribution
subsidiary, a financing subsidiary, the Council of Physicians and Scientists,
and a leading fertility portal (www.integramed.com). Nine of these fertility
centers have access to the Company's FertilityDirect Program. Five of the
fertility centers are designated as "Reproductive Science Centers(R)" and as
such, have access to the Company's FertilityDirect Program in addition to being
provided with a full range of services including: (i) administrative services,
including accounting and finance, human resource functions, and purchasing of
supplies and equipment; (ii) access to capital; (iii) marketing and sales; (iv)
integrated information systems; and (v) assistance in identifying best clinical
practices (collectively, "Business Services").
The Company's strategy is to align information, technology and finance
for the benefit of fertility patients, providers, payors and pharmaceutical
manufacturers. The primary elements of the Company's strategy include: (i)
selling additional FertilityDirect contracts to leading fertility centers in
major markets; (ii) selling Shared Risk Refund Treatment Packages to patients of
contracted fertility centers and managing the risk associated with the programs;
(iii) selling additional Reproductive Science Center Business Service contracts;
(iv) increasing revenues at Reproductive Science Centers; (v) increasing sales
of pharmaceutical products and services; (vi) expanding clinical research
opportunities; and (vii) establishing Internet-based access to patient-specific
information on treatment process and outcomes.
In December 2000, the Company's agreement with the medical center based
Reproductive Science Center was terminated early. The Company received $1.44
million in liquidated damages pursuant to an early termination agreement. The
amount received was recorded as deferred revenue at December 31, 2000, as the
Company has certain transition obligations through December 2001, and
accordingly was amortized ratably into income in 2001; $360,000 in the first
quarter of 2001. The cost of the transition obligations incurred was minor.
During 2001 the Company negotiated revised fee structures on all five
of its major Reproductive Science Center Business Services Contracts. On four of
these contracts in which Service Fees are comprised of (a) a fixed percentage of
revenue, (b) a fixed percentage of medical practice earnings and (c) reimbursed
cost of services, the Company negotiated lower fixed percentages on the revenue
and medical practice earnings components. These lower fees are to be phased in
over an estimated five-year period. The Company believes that this revised fee
structure will be more than offset by growth in the underlying Medical Practice,
and will in turn result in growth in the Company's aggregate revenues. On the
remaining Reproductive Science Center contract, the Company negotiated higher
Service Fees, which are assessed at a fixed amount each month independent of the
Medical Practice's underlying revenue or earnings. In addition, as the Company
implements its change in strategy to become more of a marketing-oriented rather
than a service-based company, costs of implementation may be incurred prior to
achieving related revenues. As a result of these issues, future income levels
may be based on income streams not necessarily reflective of those experienced
during 2001 or the first quarter of 2002.
-8-
Results of Operations
The following table shows the percentage of revenues represented by various
expense and other income items reflected in the Company's Consolidated Statement
of Operations.
For the
three-month period
ended March 31,
------------------
2002 2001
---- ----
(unaudited)
Revenues, net
Reproductive Science Center Fees ....... 78.1% 78.9%
Pharmaceutical Sales ................... 20.8% 21.0%
Other Revenues ......................... 1.1% 0.1%
----- -----
Total Revenues ......................... 100.0% 100.0%
Costs of services incurred:
Reproductive Science Center costs ...... 67.0% 65.4%
Pharmaceutical costs ................... 20.0% 20.2%
Other costs ............................ 0.6% 0.2%
----- -----
Total Costs of services and sales ...... 87.6% 85.8%
Contribution
Reproductive Science Center contribution 11.1% 13.5%
Pharmaceutical contribution ............ 0.8% 0.8%
Other contribution ..................... 0.5% (0.1)%
----- -----
Total contribution ..................... 12.4% 14.2%
General and administrative expenses ...... 8.9% 10.2%
Amortization of intangible assets ........ 1.1% 1.3%
Interest income .......................... (0.2%) (0.3%)
Interest expense ......................... 0.2% 0.5%
----- -----
Total other expenses ................... 10.0% 11.7%
----- -----
Income before income taxes ................ 2.4% 2.5%
Provision for income taxes ................ 1.0% 0.3%
----- -----
Net income ................................ 1.4% 2.2%
===== =====
Three Months Ended March 31, 2002 Compared to Three Months Ended March 31, 2001
Revenues, net for the three months ended March 31, 2002 were
approximately $20.3 million as compared to approximately $16.5 million for the
same period in 2001, an increase of 23.0%. Revenues for the Company's
Reproductive Science Centers increased $2.8 million, or 21.6%, from the first
quarter of 2001 to the first quarter of 2002. This increase is attributed to
increased patient volume at the various network sites, facilitated in part by
the establishment of additional clinical locations at the Company's Boston
location during the fourth quarter of 2001. Revenues for the Company's
pharmaceutical division increased $759,000, or 21.9%, from the first quarter of
2001 to the first quarter of 2002. This increase is due to increased
participation within the Company's Reproductive Science Centers. Other revenues
increased from $21,000 to $231,000 from the first quarter of 2001 to the first
quarter of 2002, as a result of the rising revenue stream from the Company's
FertilityDirect program.
Total costs of services as a percentage of revenues increased by 1.8%
to 87.6% during the first quarter of 2002 as compared to 85.8% for the first
quarter of 2001. Costs of services as a percentage of revenue for the Company's
Reproductive Science Center division increased from 65.4% in the first quarter
of 2001 to 67.0% during the first quarter of 2002. This increase is attributed
-9-
to program expansion at several network sites. Costs of services as a percentage
of revenue for the Company's pharmaceutical division remained stable, decreasing
0.2% from 20.2% in the first quarter of 2001 to 20.0% in the first quarter of
2002. Other costs of services as a percentage of revenue increased from 0.2% in
the first quarter of 2001 to 0.6% during the first quarter of 2002, an increase
of 0.4%. This is reflective of the growth of the Company's FertilityDirect
program.
Total Contribution for the first three months ended March 31, 2002 was
$2.5 million as compared to $2.3 million for the first quarter of 2001, an
increase of 6.7%.
General and administrative expenses for the first quarter of 2002 were
approximately $1.8 million as compared to approximately $1.7 million in the
first quarter of 2001, an increase of 6.7%. The increase was largely due to
increases in staffing and compensation attributable to implementation of
initiatives related to the Company's development of a marketing orientation
strategy. As a percentage of revenues, general and administrative expenses
decreased to approximately 8.9% in the first quarter of 2002 from approximately
10.2% in the first quarter of 2001.
Amortization of intangible assets was $225,000 in the first quarter of
2002 as compared to $216,000 in the first quarter of 2001, an increase of 4.2%.
This increase was attributable to the payment of additional performance based
business service fees.
Interest income for the first quarter of 2002 decreased to $38,000 from
$54,000 for the first quarter of 2001 due to lower interest rates earned on
invested cash balances. Interest expense for the first quarter of 2002 decreased
to $38,000 from $86,000 in the first quarter of 2001 due to scheduled payments
of debt on the Company's line of credit.
During the fourth quarter of 2001, the Company reduced its deferred tax
asset valuation allowance as the Company had achieved a sustained level of
profitability over an appropriate period and due to the likelihood of the
realization of these tax assets. As such, the Company's effective tax rate for
the first quarter of 2001 was approximately 12.4% and was comprised mainly of a
provision for state income taxes. The effective tax rate for the first quarter
of 2002 was approximately 39% and included an approximate 9% provision for state
income taxes and an approximate 30% provision for the amortization of the
deferred federal tax asset.
Net income was $291,000 in the first quarter of 2002 as compared to
$359,000 in the first quarter of 2001, a decrease of 18.9%. This decrease
resulted from the factors discussed above, including the amortization of the
deferred federal tax asset.
Liquidity and Capital Resources
Historically, the Company has financed its operations primarily through
sales of equity securities, issuance of notes and internally generated sources.
In addition, the Company has also commenced using bank financing for working
capital and business development purposes. As of March 31, 2002, the Company had
working capital of approximately $4.2 million, unchanged from December 31, 2001.
In September 2001, the Company amended its existing credit facility
with Fleet Bank, N.A. The amended facility is comprised of a $7.0 million
three-year working capital revolver, and a continuance of the Company's existing
$4.0 million 5.5 year term loan, of which approximately $2.8 million remained
outstanding with a remaining term of approximately 2.5 years as of the date of
the amendment. Availability of borrowings under the working capital revolver are
based on eligible accounts receivable as defined and as of March 31, 2002, the
full amount of the $7.0 million was available. As of March 31, 2002, the term
loan balance was $1.0 million. The Fleet credit facility is collateralized by
all of the Company's assets.
-10-
The following summarizes the Company's contractual obligations and
other commercial commitments at March 31, 2002, and the effect such obligations
are expected to have on its liquidity and cash flows in future periods.
Significant Accounting Contractual Obligations and Other Commercial Commitments:
Payments Due by Period
Total Less than 1 year 1 - 3 years 4 - 5 years After 5 years
----- ---------------- ----------- ----------- -------------
Long-term debt................ $ 2,332,000 $1,332,000 $1,000,000 $ -- $ --
Capital lease obligations..... 194,000 156,000 38,000 -- --
Operating leases.............. 14,490,000 3,208,000 8,517,000 2,765,000 --
Total contractual and case
obligations............... $ 17,016,000 $4,696,000 $9,555,000 $2,765,000 $ --
Amount of Commitment Expiration Per Period
Total Less than 1 year 1 - 3 years 4 - 5 years After 5 years
----- ---------------- ----------- ----------- -------------
Lines of credit............... $ 7,000,000 $ -- $7,000,000 $ -- $ --
Total commercial
commitments............... $ 7,000,000 $ -- $7,000,000 $ -- $ --
The Company also has commitments to provide accounts receivable
financing to the Reproductive Science Centers in accordance with its Business
Services agreements. The Company's financing of the Medical Practice's Accounts
Receivable occurs monthly on the 15th of the month following generation of the
receivable. The priority of repayment by the Medical Practice is the
reimbursement of expenses incurred by the Company on their behalf, the fixed
portion of the Business Services fee and finally the variable portion of the
Business Services fee. The Company is responsible for the collection of
receivables, which are financed with full recourse. The Company has continuously
funded these needs from cash flow from operations and the collection of the
prior month's receivables. If delays in repayment are incurred, which have not
as yet been encountered, the Company could draw on its existing working capital
line of credit. The Company does not as a general course make advances to the
Medical Practices other than for the payment of expenses on behalf of the
Medical Practice for which the Company is reimbursed in the short-term. The
Company has no other funding commitments to the Medical Practices.
From time to time, the Company also reviews various options concerning
the possibility of raising additional long-term financing through the sale of
equity or debt securities in order to fund acquisitions or construct additional
medical practice facilities. These reviews are conducted as part of the ongoing
management of the Company and are not necessarily tied to any specific
acquisition or construction plans.
Forward Looking Statements
This Form 10-Q and discussions and/or announcements made by or on
behalf of the Company, contain certain forward-looking statements regarding
events and/or anticipated results within the meaning of the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995, the
attainment of which involve various risks and uncertainties. Forward-looking
statements may be identified by the use of forward-looking terminology such as,
"may", "will", "expect", "believe", "estimate", "anticipate", "continue", or
similar terms, variations of those terms or the negative of those terms. The
-11-
Company's actual results may differ materially from those described in these
forward-looking statements due to the following factors: the Company's ability
to acquire additional business service agreements, including the Company's
ability to raise additional debt and/or equity capital to finance future growth,
the loss of significant business service agreement(s), the profitability or lack
thereof at Reproductive Science Centers serviced by the Company, increases in
overhead due to expansion, the exclusion of infertility and ART services from
insurance coverage, government laws and regulations regarding health care,
changes in managed care contracting, the timely development of and acceptance of
new infertility, ART and/or genetic technologies and techniques.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable.
-12-
Part II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; no material developments in previously reported
matters.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
See Index to Exhibits on Page 15.
-13-
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.
INTEGRAMED AMERICA, INC.
(Registrant)
Date: May 15, 2002 By: /s/ John W. Hlywak, Jr
------------------
John W. Hlywak, Jr.
Senior Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
-14-
Exhibit Number Exhibit
------- --------------
10.118 -- Service Agreement between IntegraMed America, Inc. and Northwest
Center for Infertility and Reproductive Endocrinology dated April
26, 2002.
99.8 -- Registrant's Press Release dated January 29,2002 (1)
99.9 -- Registrant's Press Release dated February 14, 2002 (2)
99.10 -- Registrant's Press Release dated February 21, 2002 (3)
99.11 -- Registrant's Press Release dated March 25, 2002 (4)
99.12 -- Registrant's Press Release dated May 2, 2002 (5)
99.13 -- Registrant's Press Release dated May 9, 2002 (6)
(1) Filed as exhibit with identical exhibit number to Registrant's Report on
From 8-K dated January 29, 2002
(2) Filed as exhibit with identical exhibit number to Registrant's Report on
Form 8-K dated February 14, 2002
(3) Filed as exhibit with identical exhibit number to Registrant's Report on
Form 8-K dated February 21, 2002
(4) Filed as exhibit with identical exhibit number to Registrant's Report on
Form 8-K dated March 25, 2002.
(5) Filed as exhibit with identical exhibit number to Registrant's Report on
Form 8-K dated May 3, 2002.
(6) Filed as exhibit with identical exhibit number to Registrant's Report on
Form 8-K dated May 10, 2002.
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