x
|
ANNUAL
REPORT UNDER SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the Fiscal Year Ended December 31, 2009
|
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from ___ to ___
Commission
File Number: 001-33094
AMERICAN
CARESOURCE HOLDINGS, INC.
|
|
(Exact
Name of Registrant as Specified in Its Charter)
|
||
Delaware
|
20-0428568
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
5429
Lyndon B. Johnson Freeway, Suite 850, Dallas, Texas
|
75240
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
(972)
308-6830
|
||
(Registrant’s
telephone number, including area code)
|
||
Securities
registered pursuant to Section 12(b) of the Exchange
Act:
|
Title
of Each Class
|
Name
of Each Exchange on Which Registered
|
|
Common
Stock, par value $.01 per share
|
The
NASDAQ Capital Market
|
|
Securities
registered pursuant to Section 12(g) of the Exchange Act:
None
|
|
Indicate
by checkmark if the Registrant is a well-known seasoned issuer, as defined
in Rule 405 of the Securities Act of 1933 (the “Securities
Act”).
|
Yes o No x
|
Indicate
by checkmark if the Registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange
Act”).
|
Yes o No x
|
Indicate
by checkmark whether the Registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act 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
o
|
Indicate
by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File
required to be submitted and posted pursuant to Rule 405 of Regulation S-T
(§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files).
|
Yes
o No o
|
Indicate
by checkmark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained in this form, and will not be contained,
to the best of Registrant’s knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
|
x
|
Indicate
by checkmark whether the Registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act. (Check one):
|
|
o Large
Accelerated Filer o Accelerated
Filer o Non-Accelerated
Filer x Smaller Reporting
Company
|
|
Indicate
by checkmark whether the Registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).
|
Yes o No x
|
The
aggregate market value of the voting and nonvoting Common Stock held by
non-affiliates of the Registrant was $30,230,109, computed by reference to
the price at which the Common Stock was last sold on The NASDAQ Capital
Market on the last business day of the Registrant’s most recently
completed second fiscal quarter (June 30, 2009).
|
|
The
number of shares of the Registrant’s Common Stock, par value $.01 per
share, outstanding as of March 22, 2010 was 16,375,604.
|
|
DOCUMENTS
INCORPORATED BY REFERENCE
|
|
Portions
of the definitive proxy statement for the annual meeting of stockholders
of American CareSource Holdings, Inc. to be held on June 9, 2010 and to be
filed with the Securities and Exchange Commission pursuant to Regulation
14A not later than April 30, 2010, are incorporated by reference into Part
III of this Form 10-K.
|
PART
I
|
|
|
Item
1.
|
1
|
|
Item
1A.
|
8
|
|
Item
2.
|
12
|
|
Item
3.
|
12
|
|
Item
4.
|
12
|
|
|
||
PART
II
|
|
|
Item
5.
|
13
|
|
Item
7.
|
14
|
|
Item
8.
|
22
|
|
Item
9.
|
22
|
|
Item
9A
|
22
|
|
Item
9B
|
23
|
|
|
||
PART
III
|
|
|
Item
10.
|
24
|
|
Item
11.
|
24
|
|
Item
12.
|
24
|
|
Item
13.
|
25
|
|
Item
14.
|
25
|
|
PART
IV
|
|
|
Item
15.
|
25
|
|
Index
to Financial Statements
|
||
F-1
|
||
F-2
|
||
F-3
|
||
F-4
|
||
F-5
|
||
F-6
|
·
|
lowering
the cost of our payors’ ancillary care costs throughout our network of
high quality, cost effective providers that we have under contract at more
favorable terms than they could generally obtain on their
own;
|
|
·
|
providing
payors with a comprehensive network of ancillary healthcare services
providers that is tailored to each payor’s specific needs and is available
to each payor’s covered persons for covered services;
|
|
·
|
providing
payors with claims management, reporting, and processing and payment
services;
|
·
|
performing
network/needs analysis to assess the benefits to payors of adding
additional/different service providers to the payor -specific provider
networks; and
|
·
|
credentialing
network service providers for inclusion in the payor -specific provider
networks.
|
·
Acupuncture
|
·
Long-term Acute Care
|
·
Cardiac Monitoring
|
·
Massage Therapy
|
·
Chiropractor
|
·
Occupational Therapy
|
·
Diagnostic Imaging
|
·
Pain Management
|
·
Dialysis
|
·
Physical Therapy
|
·
Durable Medical Equipment
|
·
Podiatry
|
·
Genetic Testing
|
·
Rehab: Outpatient
|
·
Hearing Aids
|
·
Rehab: Inpatient
|
·
Home Health
|
·
Sleep
|
·
Hospice
|
·
Skilled Nursing Facility
|
·
Implantable Devices
|
·
Surgery Center
|
·
Infusion
|
·
Transportation
|
·
Laboratory
|
·
Urgent Care
|
·
Lithotripsy
|
·
Vision
|
·
|
Provider
network management
|
·
|
Credentialing
|
·
|
Data
transfer management/electronic data
interface
|
·
|
Multi-level
reimbursement management
|
·
|
Posting,
Explanation of Benefits, check, and e-funds
processes
|
·
|
Client
service management
|
·
|
Claims
pricing
|
·
|
Advanced
data reporting
|
·
|
providing
a comprehensive network of ancillary healthcare services providers that is
available to the payor’s covered persons for covered
services;
|
·
|
providing
claims management, reporting, and processing and payment
services;
|
·
|
performing
network/needs analysis to assess the benefits to payor customers of adding
additional/different service providers to the payor-specific provider
networks; and
|
·
|
credentialing
network service providers for inclusion in the payor -specific provider
networks.
|
·
|
The
first group of competitors consists of larger, national health plans and
insurers such as Aetna, Blue Cross/Blue Shield plans, Cigna, Humana, and
United HealthCare. These larger carriers offer nation-wide,
standardized products and often compete on a local level based of the
cost-effectiveness of their national
contracts.
|
·
|
The
second group of competitors is more regionally-focused and consists of
smaller regional PPOs, payors and community-based provider-owned
networks. These regional competitors are generally managing
their own home-grown network of ancillary care providers and are more
likely to offer customized products and services tailored to the needs of
the local community. These regional groups will often use their
ownership and/or management of the full continuum of care in a local
market to direct patients to the provider groups within their
network.
|
·
|
The
third group of competitors focus on managing patients within a single
ancillary specialty (e.g. dialysis, imaging or infusion), and offer
comprehensive payor and provider services within their chosen ancillary
category.
|
·
|
The
fourth group of competitors is our own payors. Our payors have
selected us based on our extensive network of service providers and
cost-savings potential. However, they may choose to develop
their own network instead of outsourcing ancillary management services to
us in the future.
|
·
|
healthcare
fraud and abuse laws and regulations, which prohibit illegal referral and
other payments;
|
·
|
the
Employee Retirement Income Security Act of 1974 and related regulations,
which regulate many healthcare
plans;
|
·
|
mail
pharmacy laws and regulations;
|
·
|
privacy
and confidentiality laws and
regulations;
|
·
|
consumer
protection laws and regulations;
|
·
|
legislation
imposing benefit plan design
restrictions;
|
·
|
various
licensure laws, such as managed care and third party administrator
licensure laws;
|
·
|
drug
pricing legislation;
|
·
|
Medicare
and Medicaid reimbursement regulations;
and
|
·
|
Health
Insurance Portability and Accountability Act of
1996.
|
Item
5.
|
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases ofEquity
Securities.
|
High
|
Low
|
|
2009
|
||
Fourth
Quarter Ended December 31(NASDAQ)
|
$4.49
|
$1.95
|
Third
Quarter Ended September 30 (NASDAQ)
|
$4.73
|
$3.57
|
Second
Quarter Ended June 30 (NASDAQ)
|
$8.74
|
$3.50
|
First
Quarter Ended March 31 (NASDAQ)
|
$8.18
|
$6.40
|
2008
|
||
Fourth
Quarter Ended December 31(NASDAQ)
|
$9.50
|
$4.02
|
Third
Quarter Ended September 30 (NASDAQ)*
|
$9.50
|
$4.40
|
Second
Quarter Ended June 30 (Amex)
|
$4.75
|
$2.85
|
First
Quarter Ended March 31 (Amex)
|
$3.60
|
$2.40
|
·
|
providing
payor customers with a comprehensive network of ancillary healthcare
services providers that is available to their covered persons for covered
services;
|
·
|
providing
payor customers with claims management, reporting, and processing and
payment services;
|
·
|
performing
network/needs analysis to assess the benefits to payor customers of adding
additional/different service providers to the payor customer-specific
provider networks; and
|
·
|
credentialing
network service providers for inclusion in the payor customer-specific
provider networks.
|
Change
|
||||||||
($
in thousands)
|
2009
|
2008
|
$
|
%
|
||||
Net
Revenues
|
$68,311
|
$58,289
|
$10,022
|
17%
|
Year of
implementation ($ in thousands)
|
2007
and prior
|
2008
|
2009
|
Total
|
||||||||||||
2009
|
$
|
57,084
|
$
|
5,262
|
$
|
5,965
|
$
|
68,311
|
||||||||
2008
|
57,607
|
682
|
—
|
58,289
|
2009
|
2008
|
||||||
Claims
processed (in thousands)
|
437
|
302
|
|||||
Claims
billed (in thousands)
|
373
|
276
|
|||||
Revenue
per processed claim
|
$
|
156
|
$
|
193
|
|||
Revenue
per billed claim
|
183
|
211
|
Change
|
||||||||||||||||||||||||
($
in thousands)
|
2009
|
%
of revenue
|
2008
|
%
of revenue
|
$ | % | ||||||||||||||||||
Provider
payments
|
$ | 51,235 | 75 | % | $ | 42,603 | 73 | % | $ | 8,632 | 20 | % | ||||||||||||
Administrative
fees
|
3,302 | 5 | 3,395 | 6 | (93 | ) | (3 | )% | ||||||||||||||||
Claims
administration and provider development
|
4,252 | 6 | 3,255 | 5 | 997 | 31 | % | |||||||||||||||||
Total
cost of revenues
|
$ | 58,789 | 86 | % | $ | 49,253 | 84 | % | $ | 9,536 | 19 | % |
Claims
Administration
|
Provider
Development
|
Total
|
||||||||||||||||||||||||||||||||||||||||||||||
Increase
|
Increase
|
Increase
|
||||||||||||||||||||||||||||||||||||||||||||||
2009
|
2008
|
(Decrease)
|
2009
|
2008
|
(Decrease)
|
2009
|
2008
|
(Decrease)
|
||||||||||||||||||||||||||||||||||||||||
Total
wages, incentives and benefits
|
$
|
2,301
|
$
|
1,733
|
$
|
568
|
33
|
%
|
$
|
1,384
|
$
|
812
|
$
|
572
|
70
|
%
|
$
|
3,685
|
$
|
2,545
|
$
|
1,140
|
45
|
%
|
||||||||||||||||||||||||
Contract
labor and consulting fees
|
564
|
734
|
(170
|
)
|
(23
|
)%
|
85
|
6
|
79
|
nm
|
%
|
649
|
740
|
(91
|
)
|
(12
|
)%
|
|||||||||||||||||||||||||||||||
Capitalized
development costs
|
(628
|
)
|
(492
|
)
|
(136
|
)
|
28
|
%
|
—
|
—
|
—
|
—
|
%
|
(628
|
)
|
(492
|
)
|
(136
|
)
|
28
|
%
|
|||||||||||||||||||||||||||
Other
|
131
|
113
|
18
|
16
|
%
|
84
|
44
|
40
|
91
|
%
|
215
|
157
|
58
|
37
|
%
|
|||||||||||||||||||||||||||||||||
Allocation
of shared overheads
|
(37
|
)
|
53
|
(90
|
)
|
170
|
%
|
368
|
252
|
116
|
46
|
%
|
331
|
305
|
26
|
9
|
%
|
|||||||||||||||||||||||||||||||
$
|
2,331
|
$
|
2,141
|
$
|
190
|
9
|
%
|
$
|
1,921
|
$
|
1,114
|
$
|
807
|
72
|
%
|
$
|
4,252
|
$
|
3,255
|
$
|
997
|
31
|
%
|
·
|
Investments
in claims administration and provider development. Wages,
incentives and benefits increased due to resource
additions. Headcount as of December 31, 2009 and 2008 were as
follows: Claims Administration -- 33 and 26, respectively; and
Provider Development -- 15 and 8, respectively. The increases
in headcount were made to facilitate growth through the enhancement of our
network of ancillary care providers, and to grow our claims processing and
management capabilities consistent with growth in claims
volume.
|
·
|
The
aforementioned cost increases were offset by a decrease in consulting fees
related to an information technology initiative in which a platform was
developed to create data analysis efficiencies. The fees were
primarily incurred during the second and third quarters of
2008.
|
2009
|
2008
|
Percent
Change
|
||||
Contribution
margin
|
13.9%
|
15.5%
|
(1.6)%
|
Change
|
||||||||
($
in thousands)
|
2009
|
2008
|
$
|
%
|
||||
Selling,
general and administrative expenses
|
$7,626
|
$5,095
|
$2,531
|
50%
|
||||
Percentage
of total net revenues
|
11.2%
|
8.7%
|
Finance
& Administration
|
Sales
& Marketing
|
Total
|
||||||||||||||||||||||||||||||||||||||||||||||
|
2009
|
2008
|
Increase
(Decrease)
|
2009
|
2008
|
Increase
(Decrease)
|
2009
|
2008
|
Increase
(Decrease)
|
|||||||||||||||||||||||||||||||||||||||
Total
wages, commissions, incentives and benefits
|
$
|
1,459
|
$
|
1,343
|
$
|
116
|
9
|
%
|
$
|
1,540
|
$
|
683
|
$
|
857
|
125
|
%
|
$
|
2,999
|
$
|
2,026
|
$
|
973
|
48
|
%
|
||||||||||||||||||||||||
Professional
fees (legal, accounting and consulting)
|
943
|
629
|
314
|
50
|
%
|
121
|
—
|
121
|
nm
|
%
|
1,064
|
629
|
435
|
69
|
%
|
|||||||||||||||||||||||||||||||||
Stock-based
compensation expense
|
1,220
|
699
|
521
|
75
|
%
|
—
|
—
|
—
|
—
|
%
|
1,220
|
699
|
521
|
75
|
%
|
|||||||||||||||||||||||||||||||||
Investor
relations costs
|
255
|
153
|
102
|
67
|
%
|
—
|
—
|
—
|
—
|
%
|
255
|
153
|
102
|
67
|
%
|
|||||||||||||||||||||||||||||||||
Recruiting
costs
|
115
|
338
|
(223
|
)
|
(66
|
)%
|
—
|
—
|
—
|
—
|
%
|
115
|
338
|
(223
|
)
|
(66
|
)%
|
|||||||||||||||||||||||||||||||
Marketing
costs
|
—
|
—
|
—
|
—
|
%
|
317
|
25
|
292
|
nm
|
%
|
317
|
25
|
292
|
nm
|
%
|
|||||||||||||||||||||||||||||||||
Banking
fees
|
177
|
123
|
54
|
44
|
%
|
—
|
—
|
—
|
—
|
%
|
177
|
123
|
54
|
44
|
%
|
|||||||||||||||||||||||||||||||||
Other
|
371
|
371
|
—
|
—
|
%
|
122
|
58
|
64
|
110
|
%
|
493
|
429
|
64
|
15
|
%
|
|||||||||||||||||||||||||||||||||
Allocation
of shared overheads
|
509
|
556
|
(47
|
)
|
(8)
|
%
|
236
|
117
|
119
|
102
|
%
|
745
|
673
|
72
|
11
|
%
|
||||||||||||||||||||||||||||||||
Restructuring
charge
|
—
|
—
|
—
|
—
|
%
|
—
|
—
|
—
|
—
|
%
|
241
|
—
|
241
|
100
|
%
|
|||||||||||||||||||||||||||||||||
Total
selling, general and administrative expenses
|
$
|
5,049
|
$
|
4,212
|
$
|
837
|
20
|
%
|
$
|
2,336
|
$
|
883
|
$
|
1,453
|
165
|
%
|
$
|
7,626
|
$
|
5,095
|
$
|
2,531
|
50
|
%
|
·
|
Increased
headcount in our finance and administration and sales and marketing
groups. Wages, commissions, incentives and benefits during 2009
reflect the addition of four resources. These resources were
added during late 2008 and the first quarter of 2009. Headcount
as of December 31, 2009 and 2008 were as follows: Finance &
Administration – 10 and 7, respectively; and Sales & Marketing – 8 and
7, respectively.
|
·
|
Increased
compensation costs related to our stock-based incentive
plans. The increase in these costs are the direct result of an
increase in incentives granted during 2008 and 2009, and the increase in
the fair value of our stock options and restricted stock units (as
calculated under the Black-Scholes-Merton valuation model) which is
directly related to the increase in the value of our common stock during
2008 and the first half of 2009. As a result, stock-based
awards made in late-2008 through mid-2009 had higher associated costs than
those awarded during the prior
year.
|
·
|
Increased
professional fees. Our audit and legal-related activities
increased over the prior year and we implemented an enhanced compensation
plan for our Board of Directors in
2009.
|
·
|
Marketing
costs included $250,000 of amortization of the amendment of our client
agreement with one of our significant clients. The $1.0 million
payment is being amortized over a four-year period, which is the term of
the amended agreement.
|
·
|
The
increases were offset by a decline in recruiting costs of approximately
$223,000. During 2008, we incurred significant costs associated
with increasing our headcount to support strategic
initiatives.
|
Change
|
||||||||||||||||
($
in thousands)
|
2009
|
2008
|
$ | % | ||||||||||||
Depreciation
|
$ | 435 | $ | 202 | $ | 233 | 115 | % | ||||||||
Amortization
|
128 | 214 | (86 | ) | (40 | )% | ||||||||||
Total
Depreciation and amortization
|
$ | 563 | $ | 416 | $ | 147 | 35 | % |
Change
|
||||||||||||||||
($
in thousands)
|
2009
|
2008
|
$ | % | ||||||||||||
Interest
income
|
$ | 130 | $ | 178 | $ | (48 | ) | (27 | )% | |||||||
Unrealized
gain on warrant derivative
|
324 | — | 324 |
nm
|
||||||||||||
Total
other income
|
$ | 454 | $ | 178 | $ | 276 | 155 | % |
|
·
|
The Company is the primary
obligor in the arrangement. The Company has assessed its
role as primary obligor as a strong indicator of gross
reporting. The Company believes that it is the primary obligor
in its transactions because it is responsible for providing the services
desired by its client payors. The Company has distinct,
separately negotiated contractual relationships with its client payors and
with the ancillary health care providers in its networks. The
Company does not negotiate “on behalf of” its client payors and does not
hold itself out as the agent of the client payors when negotiating the
terms of the Company’s ancillary healthcare service provider
agreements. The Company’s agreements contractually prohibit
client payors and service providers to enter into direct contractual
relationships with one another. The client payors have no
control over the terms of the Company’s agreements with the service
providers. In executing transactions, the Company assumes key
performance-related risks. The client payors hold the Company
responsible for fulfillment, as the provider, of all of the services the
client payors are entitled to under their contracts; client payors do not
look to the service providers for fulfillment. In addition, the
Company bears the pricing/margin risk as the principal in the
transactions. Because the contracts with the client payors and
service providers are separately negotiated, the Company has complete
discretion in negotiating both the prices it charges its client payors and
the financial terms of its agreements with the service
providers. Since the Company’s profit is the spread between the
amounts received from the client payors and the amount paid to the service
providers, it bears significant pricing/margin risk. There is
no guaranteed mark-up payable to the Company on the amount the Company has
contracted. Thus, the Company bears the risk that amounts paid
to the service provider will be greater than the amounts received from the
client payors, resulting in a loss or negative
claim.
|
|
·
|
The Company has latitude in
establishing pricing. As stated above, the Company has
complete latitude in negotiating the price to be paid to the Company by
each client payor and the price to be paid to each contracted service
provider. This type of pricing latitude indicates that the
Company has the risks and rewards normally attributed to a principal in
the transactions.
|
|
·
|
The Company changes the
product or performs part of the services. The Company
provides the benefits associated with the relationships it builds with the
client payors and the services providers. While the parties
could deal with each other directly, the client payors would not have the
benefit of the Company’s experience and expertise in assembling a
comprehensive network of service providers, in claims management,
reporting and processing and payment services, in performing network/needs
analysis to assess the benefits to client payors of adding
additional/different service providers to the client payor-specific
provider networks, and in credentialing network service
providers.
|
|
·
|
The Company has
complete discretion in supplier
selection. One of the key factors considered by client
payors who engage the Company is to have the Company undertake the
responsibility for identifying, qualifying, contracting with and managing
the relationships with the ancillary healthcare service
providers. As part of the contractual arrangement between the
Company and its client payors, the payors identify their obligations to
their respective covered persons and then work with the Company to
determine the types of ancillary healthcare services required in order for
the payors to meet their obligations. The Company may select
the providers and contract with them to provide services at its
discretion.
|
|
·
|
The Company is involved in the
determination of product or service specifications. The
Company works with its client payors to determine the types of ancillary
healthcare services required in order for the payors to meet their
obligations to their respective covered persons. In some
respects, the Company is customizing the product through its efforts and
ability to assemble a comprehensive network of providers for its customers
that is tailored to each client payor’s specific needs. In
addition, as part of its claims processing and payment services, the
Company works with the client payors, on the one hand, and the providers,
on the other, to set claims review, management and payment
specifications.
|
|
·
|
The supplier (and not the
Company) has credit risk. The Company believes it has
some level of credit risk, but that risk is mitigated because the Company
does not remit payment to providers unless and until it has received
payment from the relevant client payors following the Company’s processing
of a claim.
|
|
·
|
The amount that the Company
earns is not fixed. The Company does not earn a fixed
amount per transaction nor does it realize a per-person per-month charge
for its services.
|
·
|
Pertain
to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of the assets of the
Company;
|
·
|
Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditure of the issuer are
being made only in accordance with authorizations of management and
directors of the Company; and
|
·
|
Provide
reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of the Company’s assets that
could have a material effect on the financial
statements.
|
Equity
Compensation Plan Information at December 31, 2009
|
|||||||||
Plan
Category
|
Number
of securities to be issued upon
exercise
of outstanding options, warrants and rights, (a)
|
Weighted-average
exercise price of outstanding options, warrants and rights
(b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a)
|
||||||
Equity
compensation plans approved by security holders
|
4,456,216
|
$2.55
|
1,590,178
|
||||||
Equity
compensation plans not approved by security holders
|
—
|
$—
|
—
|
||||||
Total
|
4,456,216
|
$2.55
|
1,590,178
|
Shares
of Common Stock issuable under outstanding warrants
|
Weighted-average
exercise price of outstanding warrants
|
|||||||
Series A
(1)
|
871,559 | $ | 0.40 | |||||
Series B
(2)
|
631,059 | $ | 0.49 | |||||
Series C
(3)
|
99,651 | $ | 5.50 | |||||
Series
D (4)
|
225,000 | $ | 1.84 | |||||
Total
Warrants Outstanding
|
1,827,269 | $ | 0.89 |
(1)
|
Series
A warrants were granted on January 20, 2005 to John Pappajohn and Derace
L. Schaffer in conjunction with the personal guarantees associated with
the Company’s $3,000,000 line of credit with Wells Fargo Bank,
NA. As of March 22, 2010, all Series A warrants were
exercised.
|
(2)
|
Series
B warrants were granted on August 9, 2005 to John Pappajohn, Derace L.
Schaffer and Matthew P. Kinley in conjunction with increasing the
Company’s line of credit with Wells Fargo Bank, NA from $3,000,000 to
$4,000,000 and the associated increase in the personal
guarantees.
|
(3)
|
Service
warrants were granted as part of the compensation to Laidlaw and Company
in connection with the Company’s March 2006 private
placement.
|
(4)
|
These
warrants were granted on May 21, 2007 to Corporate Health Plans of
America, Inc., an affiliate of the Company’s client, Texas True Choice,
Inc. (“Texas True Choice”), as partial compensation to Texas True Choice
for services to be performed by it pursuant to an ancillary care services
network access agreement between the Company and Texas True
Choice.
|
(a)
|
The following documents are filed as part of this Annual
Report on Form 10-K:
|
(1)
|
Financial Statements
|
Document
|
Pages
|
Report
of Independent Registered Public Accounting Firm
|
F-1
|
Consolidated
Statements of Income for the Years Ended December 31, 2009 and
2008
|
F-2
|
Consolidated
Balance Sheets as of December 31, 2009 and 2008
|
F-3
|
Consolidated
Statements of Stockholders’ Equity for the Years Ended December 31, 2009
and 2008
|
F-4
|
Consolidated
Statements of Cash Flows for the Years Ended December 31, 2009 and
2008
|
F-5
|
Notes
to Consolidated Financial Statements
|
F-6
|
(2)
|
Financial
Statement Schedules
|
(3)
|
Exhibits
|
2009
|
2008
|
|||||||
Net
revenues
|
$ | 68,311 | $ | 58,289 | ||||
Cost
of revenues:
|
||||||||
Provider
payments
|
51,235 | 42,603 | ||||||
Administrative
fees
|
3,302 | 3,395 | ||||||
Claims
administration and provider development
|
4,252 | 3,255 | ||||||
Total
cost of revenues
|
58,789 | 49,253 | ||||||
Contribution
margin
|
9,522 | 9,036 | ||||||
Selling,
general and administrative expenses
|
7,626 | 5,095 | ||||||
Depreciation
and amortization
|
563 | 416 | ||||||
Total
operating expenses
|
8,189 | 5,511 | ||||||
Operating
income
|
1,333 | 3,525 | ||||||
Other
income:
|
||||||||
Interest
income
|
130 | 178 | ||||||
Unrealized
gain on warrant derivative
|
324 | — | ||||||
Total
other income
|
454 | 178 | ||||||
Income
before income taxes
|
1,787 | 3,703 | ||||||
Income
tax provision (benefit)
|
(533 | ) | 65 | |||||
Net
income
|
$ | 2,320 | $ | 3,638 | ||||
Earnings
per common share:
|
||||||||
Basic
|
$ | 0.15 | $ | 0.24 | ||||
Diluted
|
$ | 0.11 | $ | 0.21 | ||||
Basic
weighted average common shares outstanding
|
15,469 | 15,084 | ||||||
Diluted
weighted average common shares outstanding
|
17,764 | 17,736 |
2009
|
2008
|
|||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 11,868 | $ | 10,578 | ||||
Accounts
receivable, net
|
7,474 | 5,788 | ||||||
Prepaid
expenses and other current assets
|
822 | 490 | ||||||
Deferred
income taxes
|
576 | 6 | ||||||
Total
current assets
|
20,740 | 16,862 | ||||||
Property
and equipment, net
|
1,762 | 915 | ||||||
Other
assets:
|
||||||||
Deferred
income taxes
|
317 | 244 | ||||||
Other
assets
|
657 | 883 | ||||||
Intangible
assets, net
|
1,153 | 1,281 | ||||||
Goodwill
|
4,361 | 4,361 | ||||||
$ | 28,990 | $ | 24,546 | |||||
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Due
to service providers
|
$ | 7,702 | $ | 5,964 | ||||
Accounts
payable and accrued liabilities
|
1,980 | 3,115 | ||||||
Total
current liabilities
|
9,682 | 9,079 | ||||||
Warrant
derivative liability
|
18 | — | ||||||
Commitments
and contingencies
|
||||||||
Shareholders’
equity:
|
||||||||
Preferred
stock, $0.01 par value; 10,000 shares authorized none
issued
|
— | — | ||||||
Common
stock, $0.01 par value; 40,000 shares authorized; 15,642 and 15,407 shares
issued and outstanding in 2009 and 2008, respectively
|
156 | 154 | ||||||
Additional
paid-in capital
|
20,605 | 19,046 | ||||||
Accumulated
deficit
|
(1,471 | ) | (3,733 | ) | ||||
Total
shareholders’ equity
|
19,290 | 15,467 | ||||||
$ | 28,990 | $ | 24,546 |
Common
Stock
|
||||||||||||||||||||
Shares
|
Amount
|
Additional
Paid-in Capital
|
Accumulated
Deficit
|
Total
Stockholders’ Equity
|
||||||||||||||||
Balance
at December 31, 2007
|
14,668 | $ | 145 | $ | 17,614 | $ | (7,371 | ) | $ | 10,388 | ||||||||||
Net
income
|
— | — | — | 3,638 | 3,638 | |||||||||||||||
Stock-based
compensation expense
|
— | — | 699 | — | 699 | |||||||||||||||
Issuance
of common stock upon exercise of stock options
|
701 | 7 | 445 | — | 452 | |||||||||||||||
Issuance
of common stock upon exercise of stock warrants
|
23 | 1 | 128 | — | 129 | |||||||||||||||
Issuance
of common stock upon net warrant exercises
|
15 | 1 | (1 | ) | — | — | ||||||||||||||
Issuance
of common stock warrants for payment of client management
fees
|
— | — | 161 | — | 161 | |||||||||||||||
Balance
at December 31, 2008
|
15,407 | $ | 154 | $ | 19,046 | $ | (3,733 | ) | $ | 15,467 | ||||||||||
Cumulative
effect of change in accounting principle – January 1, 2009
reclassification of embedded feature of equity-linked financial instrument
to warrant derivative liability
|
— | — | (316 | ) | (58 | ) | (374 | ) | ||||||||||||
Net
income
|
— | — | — | 2,320 | 2,320 | |||||||||||||||
Stock-based
compensation expense
|
— | — | 1,495 | — | 1,495 | |||||||||||||||
Issuance
of common stock upon exercise of stock options and restricted stock
units
|
20 | — | (12 | ) | — | (12 | ) | |||||||||||||
Issuance
of common stock upon exercise of stock warrants
|
215 | 2 | 81 | — | 83 | |||||||||||||||
Issuance
of common stock warrants for payment of client management
fees
|
— | — | 311 | — | 311 | |||||||||||||||
Balance
at December 31, 2009
|
15,642 | $ | 156 | $ | 20,605 | $ | (1,471 | ) | $ | 19,290 |
2009
|
2008
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income
|
$ | 2,320 | $ | 3,638 | ||||
Adjustments
to reconcile net income to net cash provided by
operations:
|
||||||||
Stock-based
compensation expense
|
1,495 | 699 | ||||||
Depreciation
and amortization
|
563 | 415 | ||||||
Unrealized
gain on warrant derivative
|
(324 | ) | — | |||||
Amortization
of long-term client agreement
|
250 | — | ||||||
Deferred
income tax provision (benefit)
|
(643 | ) | 12 | |||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
(1,686 | ) | (2,137 | ) | ||||
Prepaid
expenses and other assets
|
(56 | ) | 429 | |||||
Accounts
payable and accrued liabilities
|
(1,102 | ) | 689 | |||||
Due
to service providers
|
1,738 | 2,620 | ||||||
Net
cash provided by operating activities
|
2,555 | 6,365 | ||||||
Cash
flows from investing activities:
|
||||||||
Investments
in internally developed software
|
(628 | ) | (492 | ) | ||||
Investments
in property and equipment
|
(653 | ) | (292 | ) | ||||
Redemption
of certificate of deposit
|
— | 145 | ||||||
Net
cash used in investing activities
|
(1,281 | ) | (639 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Proceeds
from exercise of stock warrants
|
13 | 127 | ||||||
Proceeds
from exercise of stock options
|
3 | 452 | ||||||
Net
cash provided by financing activities
|
16 | 579 | ||||||
Net
increase in cash and cash equivalents
|
1,290 | 6,305 | ||||||
Cash
and cash equivalents at beginning of period
|
10,578 | 4,273 | ||||||
Cash
and cash equivalents at end of period
|
$ | 11,868 | $ | 10,578 | ||||
Supplemental
cash flow information:
|
||||||||
Cash
paid for taxes
|
$ | 90 | $ | 15 | ||||
Supplemental
non-cash financing activity:
|
||||||||
Warrants
issued as payment of client management fees
|
$ | 311 | $ | 161 | ||||
Warrant
exercise in accrued liabilities
|
38 | — | ||||||
Warrant
derivative liability transferred to equity upon exercise
|
32 | — |
|
·
|
providing
payors with a comprehensive network of ancillary healthcare services
providers that is tailored to each payor customer’s specific needs and is
available to each payor customer’s covered persons for covered
services;
|
|
·
|
providing
payor customers with claims management, reporting, and processing and
payment services;
|
|
·
|
performing
network/needs analysis to assess the benefits to payor customers of adding
additional/different service providers to the payor customer-specific
provider networks; and
|
|
·
|
credentialing
network service providers for inclusion in the payor customer-specific
provider networks.
|
|
·
|
The Company is the primary
obligor in the arrangement. The Company has assessed its
role as primary obligor as a strong indicator of gross
reporting. The Company believes that it is the primary obligor
in its transactions because it is responsible for providing the services
desired by its client payors. The Company has distinct,
separately negotiated contractual relationships with its client payors and
with the ancillary health care providers in its networks. The
Company does not negotiate “on behalf of” its client payors and does not
hold itself out as the agent of the client payors when negotiating the
terms of the Company’s ancillary healthcare service provider
agreements. The Company’s agreements contractually prohibit
client payors and service providers to enter into direct contractual
relationships with one another. The client payors have no
control over the terms of the Company’s agreements with the service
providers. In executing transactions, the Company assumes key
performance-related risks. The client payors hold the Company
responsible for fulfillment, as the provider, of all of the services the
client payors are entitled to under their contracts; client payors do not
look to the service providers for fulfillment. In addition, the
Company bears the pricing/margin risk as the principal in the
transactions. Because the contracts with the client payors and
service providers are separately negotiated, the Company has complete
discretion in negotiating both the prices it charges its client payors and
the financial terms of its agreements with the service
providers. Since the Company’s profit is the spread between the
amounts received from the client payors and the amount paid to the service
providers, it bears significant pricing/margin risk. There is
no guaranteed mark-up payable to the Company on the amount the Company has
contracted. Thus, the Company bears the risk that amounts paid
to the service provider will be greater than the amounts received from the
client payors, resulting in a loss or negative
claim.
|
|
·
|
The Company has latitude in
establishing pricing. As stated above, the Company has
complete latitude in negotiating the price to be paid to the Company by
each client payor and the price to be paid to each contracted service
provider. This type of pricing latitude indicates that the
Company has the risks and rewards normally attributed to a principal in
the transactions.
|
|
·
|
The Company changes the
product or performs part of the services. The Company
provides the benefits associated with the relationships it builds with the
client payors and the services providers. While the parties
could deal with each other directly, the client payors would not have the
benefit of the Company’s experience and expertise in assembling a
comprehensive network of service providers, in claims management,
reporting and processing and payment services, in performing network/needs
analysis to assess the benefits to client payors of adding
additional/different service providers to the client payor-specific
provider networks, and in credentialing network service
providers.
|
|
·
|
The Company has discretion in
supplier selection. The Company has complete discretion
in supplier selection. One of the key factors considered by
client payors who engage the Company is to have the Company undertake the
responsibility for identifying, qualifying, contracting with and managing
the relationships with the ancillary healthcare service
providers. As part of the contractual arrangement between the
Company and its client payors, the payors identify their obligations to
their respective covered persons and then work with the Company to
determine the types of ancillary healthcare services required in order for
the payors to meet their obligations. The Company may select
the providers and contract with them to provide services at its
discretion.
|
|
·
|
The Company is involved in the
determination of product or service specifications. The
Company works with its client payors to determine the types of ancillary
healthcare services required in order for the payors to meet their
obligations to their respective covered persons. In some
respects, the Company is customizing the product through its efforts and
ability to assemble a comprehensive network of providers for its customers
that is tailored to each client payor’s specific needs. In
addition, as part of its claims processing and payment services, the
Company works with the client payors, on the one hand, and the providers,
on the other, to set claims review, management and payment
specifications.
|
|
·
|
The supplier (and not the
Company) has credit risk. The Company believes it has
some level of credit risk, but that risk is mitigated because the Company
does not remit payment to providers unless and until it has received
payment from the relevant client payors following the Company’s processing
of a claim.
|
|
·
|
The amount that the Company
earns is not fixed. The Company does not earn a fixed
amount per transaction nor does it realize a per-person per-month charge
for its services.
|
2009
|
2008
|
||||||||||||||||
Accounts
Receivable
|
Revenue
|
%
of Total Revenue
|
Accounts
Receivable
|
Revenue
|
%
of Total Revenue
|
||||||||||||
Client
A
|
$
|
2,976
|
$
|
32,454
|
|
47
|
%
|
|
$
|
3,059
|
|
$
|
34,275
|
|
59
|
%
|
|
Client
B
|
|
3,478
|
|
|
25,897
|
|
38
|
|
|
2,369
|
|
|
22,688
|
|
39
|
||
All
Others
|
|
1,020
|
|
|
9,960
|
|
15
|
|
|
360
|
|
|
1,326
|
|
2
|
||
|
$
|
7,474
|
|
$
|
68,311
|
|
100
|
%
|
|
$
|
5,788
|
|
$
|
58,289
|
|
100
|
%
|
2009
|
2008
|
|||||||
Beginning
balance
|
$ | 200 | $ | 190 | ||||
Provisions
for losses - accounts receivable
|
— | 85 | ||||||
Deduction
for accounts charged off
|
(42 | ) | (75 | ) | ||||
Ending
balance
|
$ | 158 | $ | 200 |
Useful
Lives (years)
|
2009
|
2008
|
||||||||||
Computer
equipment
|
3-5
|
|
$
|
428
|
|
$
|
379
|
|
||||
Software
– purchased
|
3-5
|
|
|
434
|
|
|
329
|
|
||||
Software
– internally developed
|
5
|
1,164
|
536
|
|||||||||
Furniture
and fixtures
|
5
|
|
|
356
|
|
|
146
|
|
||||
Leasehold
improvements
|
7
|
|
|
205
|
|
|
40
|
|
||||
|
|
2,587
|
|
|
1,430
|
|
||||||
Accumulated
depreciation and amortization
|
|
|
(825
|
)
|
|
|
(515
|
)
|
||||
Property
and equipment, net
|
|
|
$
|
1,762
|
|
$
|
915
|
|
2009
|
2008
|
|||||||
Computed
“expected” tax provision
|
|
$
|
608
|
|
$
|
1,273
|
||
Change
in the valuation allowance for deferred tax assets
|
|
|
(1,199
|
)
|
|
|
(1,217
|
)
|
Change
in fair value of warrant derivative liability
|
|
|
(113
|
)
|
|
|
—
|
|
State
taxes
|
|
|
80
|
|
|
65
|
|
|
Other
|
|
|
91
|
|
|
|
(56
|
)
|
Total
income tax provision (benefit)
|
|
$
|
(533
|
)
|
|
$
|
65
|
2009
|
2008
|
|||||||
Deferred
tax assets:
|
|
|
|
|
|
|
||
Operating
loss carryforward
|
|
$
|
196
|
|
$
|
815
|
|
|
Accounts
receivable allowance
|
|
|
55
|
|
|
70
|
|
|
Warrants
|
|
|
229
|
|
|
176
|
|
|
Texas
tax credit carryforward
|
|
|
244
|
|
|
250
|
|
|
Stock
option compensation
|
|
|
911
|
|
|
395
|
|
|
Accrued
expenses
|
147
|
285
|
||||||
Alternative
Minimum Tax credit carryforwards
|
|
|
39
|
|
|
—
|
|
|
Total
deferred tax assets
|
|
|
1,821
|
|
|
1,991
|
|
|
Deferred
tax liabilities:
|
|
|
|
|
|
|
||
Goodwill
|
|
|
(442
|
)
|
|
|
(322
|
)
|
Fixed
assets
|
|
|
(456
|
)
|
|
|
(199
|
)
|
Prepaid
expense
|
|
|
(30
|
)
|
|
|
(21
|
)
|
Total
deferred tax liabilities
|
|
|
(928
|
)
|
|
|
(542
|
)
|
|
|
|
|
|
|
|
||
Net
deferred tax assets
|
|
|
893
|
|
|
1,449
|
||
Valuation
allowance
|
|
|
—
|
|
|
(1,199
|
)
|
|
Deferred
tax assets, net of valuation allowance
|
|
$
|
893
|
|
$
|
250
|
2009
|
2008
|
|||||||
Current
|
|
$
|
110
|
|
|
$
|
53
|
|
Deferred
|
|
|
(643
|
)
|
|
|
12
|
|
|
|
$
|
(533
|
)
|
|
$
|
65
|
2009
|
2008
|
|||||||
Provider
contracts
|
|
$
|
1,921
|
|
$
|
1,921
|
||
Software
|
|
|
428
|
|
|
|
428
|
|
|
|
2,349
|
|
|
2,349
|
|||
Accumulated
amortization
|
|
|
(1,196
|
)
|
|
|
(1,068
|
)
|
Acquisition
intangibles, net
|
|
$
|
1,153
|
|
$
|
1,281
|
Operating
Leases
|
||
2010
|
|
421
|
2011
|
|
423
|
2012
|
|
412
|
2013
|
104
|
|
|
|
|
Total
minimum lease payments
|
$
|
1,360
|
2009
|
2008
|
|||
Weighted
average grant date fair value
|
|
$3.87
|
|
$2.82
|
Weighted
average assumptions used
|
|
|
|
|
Expected
volatility
|
|
69.8%
|
|
65.8%
|
Expected
lives
|
|
6.4
years
|
|
5.3
years
|
Risk
free interest rate
|
|
2.6%
|
|
2.7%
|
Forfeiture
rate
|
|
24.3%
|
|
24.3%
|
Dividend
rate
|
—
|
—
|
Options
|
Weighted-Average
Exercise Price
|
||||
Outstanding
at December 31, 2007
|
|
2,001
|
|
$1.41
|
|
|
|
|
|
|
|
Granted
|
|
1,115
|
|
$4.88
|
|
|
|
|
|
||
Forfeited
|
|
(60
|
)
|
$2.82
|
|
|
|
|
|
|
|
Exercised
|
|
(701
|
)
|
$0.65
|
|
|
|
|
|
|
|
Outstanding
at December 31, 2008
|
|
2,355
|
|
$3.25
|
|
|
|
|
|
|
|
Granted
|
|
450
|
|
$5.96
|
|
|
|
|
|
||
Forfeited
|
|
(167
|
)
|
$3.68
|
|
Cancelled
|
(130
|
)
|
$7.02
|
||
|
|
|
|
|
|
Exercised
|
|
(20
|
)
|
$2.47
|
|
|
|
||||
Outstanding
at December 31, 2009
|
|
2,488
|
$3.52
|
||
Exercisable
at December 31, 2009
|
1,415
|
$2.38
|
|||
Options
Outstanding
|
Options
Exercisable
|
|||||||||
Range
of Exercise Price
|
Number
Outstanding
|
Weighted
Average Outstanding Contractual Life
|
Weighted
Average Exercise Price
|
Number
Exercisable
|
Weighted
Average Exercise Price
|
|||||
Under
$1.00
|
|
438
|
|
5.4
|
$0.34
|
|
438
|
|
$0.34
|
|
$1.00
- $2.00
|
|
386
|
|
7.3
|
$1.86
|
|
369
|
|
$1.86
|
|
$2.01
- $3.00
|
|
311
|
|
8.2
|
$2.57
|
|
148
|
|
$2.60
|
|
$3.01
- $4.00
|
|
436
|
|
8.1
|
$3.38
|
|
238
|
|
$3.40
|
|
$4.01
- $5.00
|
|
308
|
|
8.7
|
$4.32
|
|
60
|
|
$4.19
|
|
$5.01
- $6.00
|
|
50
|
|
6.1
|
$5.60
|
|
50
|
|
$5.60
|
|
$6.01
- $7.00
|
|
238
|
|
8.9
|
$6.88
|
|
60
|
|
$6.88
|
|
Greater
than $7.01
|
|
321
|
|
9.0
|
$7.36
|
|
52
|
|
$7.53
|
RSUs
|
Weighted-Average
Fair Value
|
||||
|
|
|
|
|
|
Outstanding
at December 31, 2008
|
|
—
|
|
$—
|
|
|
|
|
|
|
|
Granted
|
|
154
|
|
$7.00
|
|
|
|
|
|
|
|
Forfeited
|
|
(4
|
)
|
$7.02
|
|
|
|
|
|
|
|
Converted
to common stock
|
|
(10
|
)
|
$7.02
|
|
|
|
||||
Outstanding
at December 31, 2009
|
|
140
|
$6.99
|
||
Vested
and convertible to common stock at December 31, 2009
|
32
|
$7.02
|
2009
|
2008
|
|||||
Numerator:
|
|
|
|
|
|
|
Net
income for basic earnings per share
|
$
|
2,320
|
$
|
3,638
|
|
|
Less:
|
||||||
Change
in fair value of warrant derivative liability
|
324
|
—
|
||||
Net
income for diluted earnings per share
|
$
|
1,996
|
$
|
3,638
|
||
Denominator:
|
|
|
|
|
|
|
Weighted-average
basic common shares outstanding
|
|
15,469
|
|
15,084
|
|
|
Assumed
conversion of dilutive securities:
|
|
|
|
|
|
|
Stock
options
|
|
691
|
|
1,003
|
|
|
Warrants
|
1,602
|
1,649
|
||||
Restricted
stock units
|
|
2
|
|
—
|
|
|
Potentially
dilutive common shares
|
|
2,295
|
|
2,652
|
|
|
Denominator
for diluted earnings per share – Adjusted weighted-average
shares
|
|
17,764
|
|
17,736
|
|
|
Earnings
per common share:
|
|
|
|
|
|
|
Basic
|
$
|
0.15
|
$
|
0.24
|
|
|
Diluted
|
$
|
0.11
|
$
|
0.21
|
Outstanding
Warrants
|
Weighted-Average
Exercise Price
|
|||
Outstanding
at December 31, 2007
|
2,123
|
|
$0.96
|
|
|
|
|
|
|
Exercised
|
(57
|
)
|
$5.06
|
|
|
|
|
|
|
Outstanding
at December 31, 2008
|
2,066
|
|
$0.85
|
|
|
|
|
|
|
Exercised
|
(239
|
)
|
$0.60
|
|
|
|
|
|
|
Outstanding
at December 31, 2009
|
1,827
|
|
$0.89
|
|
Vested
at December 31, 2009
|
1,771
|
$0.86
|
Total
|
Quoted
prices in active markets for identical assets
(Level 1)
|
Significant
other observable inputs
(Level 2)
|
Significant
unobservable inputs
(Level 3)
|
||||||||||||
Warrant
derivative liability
|
$
|
18
|
$
|
—
|
$
|
—
|
$
|
18
|
January
1,
|
December
31,
|
|||||||
2009
|
2009
|
|||||||
Exercise
price
|
$
|
5.50
|
$
|
5.50
|
||||
Expected
volatility
|
73.4
|
%
|
68.9
|
%
|
||||
Expected
life (years)
|
2.13
|
1.17
|
||||||
Risk
free interest rate
|
0.8
|
%
|
0.6
|
%
|
||||
Forfeiture
rate
|
—
|
—
|
||||||
Dividend
rate
|
—
|
—
|
Initial
recognition of warrant derivative as of January 1, 2009
|
$
|
374
|
||
Sales
of warrant derivative
|
(32
|
)
|
||
Unrealized
gains related to the change in fair value
|
(324
|
)
|
||
Balance
as of December 31, 2009
|
$
|
18
|
Quarters
Ended
|
|||||||||||||||||||||||
2009
|
2008
|
||||||||||||||||||||||
Dec.
31
|
Sept.
30
|
June
30
|
Mar.
31
|
Dec.
31
|
Sept.
30
|
June
30
|
Mar.
31
|
||||||||||||||||
Net
revenues
|
$
|
16,886
|
|
$
|
18,235
|
|
$
|
17,135
|
|
$
|
16,055
|
|
$
|
17,660
|
|
$
|
16,111
|
|
$
|
13,012
|
|
$
|
11,506
|
Contribution
margin
|
|
2,520
|
|
|
2,356
|
|
|
2,346
|
|
|
2,300
|
|
|
2,873
|
|
|
2,556
|
|
|
1,902
|
|
|
1,705
|
Contribution
margin %
|
14.9
|
12.9
|
13.7
|
14.3
|
16.2
|
15.9
|
14.6
|
14.8
|
|||||||||||||||
Income
before income taxes
|
|
770
|
|
|
168
|
|
|
547
|
|
|
302
|
|
|
1,498
|
|
|
1,028
|
|
|
640
|
|
|
538
|
Net
income
|
|
1,360
|
|
|
147
|
|
|
534
|
|
|
279
|
|
|
1,495
|
|
|
1,001
|
|
|
621
|
|
|
521
|
Earnings
per diluted share
|
|
0.07
|
|
|
0.01
|
|
|
0.01
|
|
|
0.02
|
|
|
0.08
|
|
|
0.06
|
|
|
0.04
|
|
|
0.03
|
Shares
used in computing diluted earnings per share
|
|
17,140
|
|
|
17,573
|
|
|
18,055
|
|
|
18,287
|
|
|
18,208
|
|
|
18,045
|
|
|
17,435
|
|
|
17,225
|
AMERICAN
CARESOURCE HOLDINGS, INC.
|
||
By:
/s/ David S. Boone
|
March
25, 2010
|
|
David
S. Boone
Chief
Executive Officer
Director
(Principal
Executive Officer)
|
Date
|
|
Pursuant
to the requirements the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
|
||
By:
/s/ Kenneth S. George
|
March
26, 2010
|
|
Kenneth
S. George
Chairman
of the Board of Directors
|
Date
|
|
By:
/s/ David S. Boone
|
March
25, 2010
|
|
David
S. Boone
Chief
Executive Officer
Director
(Principal
Executive Officer)
|
Date
|
|
By:
/s/ Matthew D. Thompson
|
March
25, 2010
|
|
Matthew
D. Thompson
Vice
President of Finance and Interim Chief Financial Officer
(Principal Financial Officer
and Principal Accounting Officer)
|
Date
|
|
By:
/s/ Sami
S. Abbasi
|
March
25, 2010
|
|
Sami
S. Abbasi
Director
|
Date
|
|
By:
/s/ Edward
B. Berger
|
March
25, 2010
|
|
Edward
B. Berger Director |
Date
|
|
By:
/s/ John N. Hatsopoulos
|
March
25, 2010
|
|
John
N. Hatsopoulos
Director
|
Date
|
|
By:
/s/ Derace L. Schaffer
|
March
26, 2010
|
|
Derace
L. Schaffer
Director
|
Date
|
By:
/s/ John Pappajohn
|
March
26, 2010
|
|
John
Pappajohn
Director
|
Date
|
|
By:
/s/ John W. Colloton
|
March
25, 2010
|
|
John
W. Colloton
Director
|
Date
|
Exhibit
#
|
Description
of Exhibits
|
3.1(1)
|
Certificate
of Incorporation of American CareSource Holdings, Inc.
|
3.2(1)
|
By-Laws
|
3.3(2)
|
Amendment
to the Certificate of Incorporation of American CareSource Holdings, Inc.,
dated May 25, 2005
|
3.4(2)
|
Amendment
to the Certificate of Incorporation of American CareSource Holdings, Inc.,
dated June 2, 2005
|
3.5(3)
|
Amendment
to the Certificate of Incorporation of American CareSource Holdings, Inc.,
dated November 14, 2005
|
3.6(4)
|
Certificate
of Incorporation of Ancillary Care Services – Group Health,
Inc.
|
3.7(4)
|
Certificate
of Incorporation of Ancillary Care Services – Medicare,
Inc.
|
3.8(4)
|
Certificate
of Incorporation of Ancillary Care Services – Worker’s Compensation,
Inc.
|
3.9(4)
|
Certificate
of Incorporation of Ancillary Care Services, Inc.
|
4.1(6)
|
Amended
and Restated 2005 Stock Option Plan
|
4.2(2)
|
Specimen
Stock Certificate
|
10.03(7)*+
|
Employment
Agreement dated September 1, 2006 between American CareSource Holdings,
Inc. and Kurt Fullmer
|
10.04(7)*+
|
Employment
Agreement dated February 19, 2007 between American CareSource Holdings,
Inc. and Maria Baker
|
10.05(7)*+
|
Employment
Agreement dated February 19, 2007 between American CareSource Holdings,
Inc. and Jennifer Boone
|
10.06(9)*+
|
Employment
Agreement dated October 12, 2007 between American CareSource Holdings,
Inc. and Steven J. Armond
|
10.07(8)*+
|
Separation
Agreement and General Release dated July 12, 2007 between American
CareSource Holdings, Inc. and Wayne Schellhammer
|
10.08*+
|
Employment
Letter dated January 29, 2008 between American CareSource Holdings, Inc.
and Cornelia Outten
|
10.09*+
|
Employment
Letter dated March 6, 2008 between American CareSource Holdings, Inc. and
Rost Ginevich
|
10.10(4)
|
Form
of Registration Rights Agreement used in March 2006 private
placement
|
10.11(4)
|
Form
of Subscription Agreement used in March 2006 private
placement
|
10.12(4)
|
Amended
and Restated Stock Purchase Warrant dated March 30, 2006 by and between
American CareSource Holdings, Inc. and John Pappajohn (amends Stock
Purchase Warrant dated January 27, 2005).
|
10.13(4)
|
Amended
and Restated Stock Purchase Warrant dated March 29, 2006 by and between
American CareSource Holdings, Inc. and Derace L. Schaffer (amends Stock
Purchase Warrant dated January 27, 2005).
|
10.14(4)
|
Amended
and Restated Stock Purchase Warrant dated March 29, 2006 by and between
American CareSource Holdings, Inc. and John Pappajohn (amends Stock
Purchase Warrant dated August 15, 2005).
|
10.15(4)
|
Amended
and Restated Stock Purchase Warrant dated March 29, 2006 by and between
American CareSource Holdings, Inc. and Derace L. Schaffer (amends Stock
Purchase Warrant dated August 15, 2005).
|
10.16(4)
|
Amended
and Restated Stock Purchase Warrant dated March 30, 2006 by and between
American CareSource Holdings, Inc. and Matthew P. Kinley (amends Stock
Purchase Warrant dated August 15, 2005).
|
10.17(5)
|
Lease
dated June 14, 2006, between American CareSource Holdings, Inc. and TR LBJ
Campus Partners, L.P.
|
10.18(10)
|
First
Amendment to Office Lease, dated December 1, 2008, between American
CareSource Holdings, Inc. and TR LBJ Campus Partners,
L.P.
|
10.19(10),
***
|
Provider
Services Agreement, dated as of August 1, 2002, by and among the Company,
HealthSmart Holdings, Inc. and HealthSmart Preferred Care II, L.P, and
Amendment No. 1, 3 and 4 thereto, dated January 1, 2007, July 31, 2007 and
December 20, 2008, respectively.
|
10.20(10),
*+
|
Employment
Letter dated November 10, 2008 between American CareSource Holdings, Inc.
and James T. Robinson.
|
10.21(10),***
|
Ancillary
Care Services Network Access Agreement, dated as of July 2, 2007, by and
between the Company and Texas True Choice, Inc. and its
subsidiaries.
|
10.22+
|
Letter
Agreement dated December 24, 2009 by and between American CareSource
Holdings, Inc. and James T. Robinson.
|
10.23+
|
Letter
Agreement dated November 4, 2009 by and between American CareSource
Holdings, Inc. and Steven J. Armond.
|
14.1(4)
|
Code
of Ethics
|
20.1(5)
|
Governance
and Nominating Committee Charter
|
20.2(5)
|
Audit
Committee Charter
|
20.3(5)
|
Compensation
Committee Charter
|
21.1
|
Subsidiaries
|
23.1
|
Consent
of McGladrey & Pullen LLP
|
31.1
|
Certification
of the Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
31.2
|
Certification
of the Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
32.1
|
Certification
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
(1)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to
Amendment No. 1 to the Form SB-2 filed May 13, 2005 and incorporated
herein byreference.
|
(2)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to
Amendment No. 5 to the Form SB-2 filed August 12, 2005 and incorporated
herein by reference.
|
(3)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to
Amendment No. 8 to the Form SB-2 filed November 18, 2005 and
incorporated herein by reference.
|
(4)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 10-KSB filed March 31, 2006 and incorporated herein by
reference.
|
(5)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 10-QSB filed August 11, 2006 and incorporated herein by
reference.
|
(6)
|
Previously
filed with the Securities and Exchange Commission as Exhibit A to
Amendment No. 1 to the Proxy Statement for the 2007 Annual Meeting of
Stockholders filed May 1, 2007 and incorporated herein by
reference.
|
(7)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 10-QSB filed May 15, 2007 and incorporated herein by
reference.
|
(8)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 8-K filed July 17, 2007 and incorporated herein by
reference.
|
(9)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 10-QSB filed November 13, 2007 and incorporated herein by
reference.
|
(10)
|
Previously
filed with the Securities and Exchange Commission as an exhibit to the
Form 10-K filed March 31, 2009 and incorporated herein by
reference.
|