UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of
1934
Date of report (Date of earliest event reported): March 5, 2012
COMPREHENSIVE CARE CORPORATION
(Exact Name of Registrant Specified in Charter)
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Delaware
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1-9927
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95-2594724
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(State or Other Jurisdiction
of Incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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3405 W. Dr. Martin Luther King Jr. Blvd, Suite 101
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Tampa, Florida
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33607
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (813) 288-4808
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
On March 5 2012, CompCare de Puerto Rico, Inc., a wholly-owned subsidiary of Comprehensive Care Corporation (“the
Company”), entered into a Second Amendment (“the Amendment”) to the original agreement with MSO of Puerto Rico, Inc. to provide its health plan members mental health, substance abuse treatment, and pharmacy management services. The
original agreement was filed as Exhibit 10.21 to Form 10-Q/A for the quarter ended September 30, 2010. Pursuant to the Amendment, the original contract term was extended to December 31, 2012 and the current contract rate for pharmacy
management service was increased by approximately 11% effective January 1, 2012. The foregoing description is a summary of the Amendment and the transaction contemplated thereby. This summary does not purport to be complete and is qualified in
its entirety by the complete text of the Amendment, which is filed as Exhibit 10.1 to the Current Report on Form 8-K as is incorporated herein by reference.
Item 8.01 Other Events.
On March 8, 2010, the Company issued a press release
announcing the signing of the Amendment. A copy of the press release is attached herein as Exhibit 99.1.
Item 9.01 Financial
Statements and Exhibits
10.1 Second Amendment to the
Agreement for the Provision of Services with an effective date of March 1, 2012, by and between CompCare de Puerto Rico, Inc. and MSO of Puerto Rico, Inc. (On January 3, 2011, the Registrant was granted permission, until September 18,
2015, to not publicly disclose certain information deemed confidential in the original agreement that is modified by the Amendment that is the subject of this Current Report on Form 8-K. As such, the Amendment similarly excludes disclosure of
certain information, indicated as [*] within this Exhibit. The confidential treatment order was granted pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.)
99.1 Press Release, dated March 8, 2012
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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COMPREHENSIVE CARE CORPORATION
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Date: March 8, 2012
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By:
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/s/ Clark A. Marcus
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Clark A. Marcus
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Chairman and Chief Executive Officer
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EXHIBIT 10.1
SECOND AMENDMENT TO THE AGREEMENT FOR THE PROVISION OF SERVICES
This Second Amendment (“Amendment”) to the Agreement for the Provision of Services (“the Agreement”) with an effective date of March 1, 2012 (the “Effective Date”), is
entered into by and between CompCare de Puerto Rico, Inc., (“CompCare”), and MSO of Puerto Rico, Inc., (“MSO”), sets forth additional duties and obligations
WHEREAS, MMM Healthcare, Inc. and its corporate affiliate PMC Medicare, Choice, Inc. and CompCare executed an Agreement for the Provision of Services entered into the 13th day of August, 2010 with an
effective date of September 18, 2010, pursuant to which CompCare provides and arranges for the provision of mental health, substance abuse and certain pharmacy-related services to individuals covered by Benefit Plans sponsored or issued by
Health Plans.
WHEREAS, Health Plans assigned its duties and obligations to the MSO effective January 10, 2012.
WHEREAS, MSO and CompCare desire to amend the Agreement in accordance with the definitive terms and conditions set forth below.
Amendment
1.
Section 12 “Term and Termination”, clause 12.1 of the Agreement is amended to add the language in
bold
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“12.1 Term This Agreement shall be effective on the Effective Date and shall continue until December 31, 2012, unless
terminated as provided in this Agreement.
2. Exhibit A “Services Payment Addendum” of the Agreement is amended to modify the
pharmacy PMPM amount for year two as follows:
The Pharmacy PMPM for Year two as established in the Agreement is $[*]. The
parties agree to modify said amount to include an additional $[*] PMPM. The total Pharmacy amount payable to CompCare by the MSO effective from January 1, 2012 until the termination of the Agreement is $[*] PMPM.
Except as expressly set forth in this Amendment, the terms and conditions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF
, the parties hereto have caused their respective duly authorized officers to execute and deliver this Agreement as of the date
first written above, to be effective on the Effective Date.
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COMPCARE DE PUERTO RICO, INC.
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MSO OF PUERTO RICO, INC.
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By:
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/s/ Clark Marcus
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By:
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/s/ Raul Montalvo
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Printed Name:
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Clark Marcus
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Printed Name:
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Raul Montalvo, MD
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Title:
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CEO
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Title:
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President
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Comprehensive Behavioral Care Inc. and Comprehensive Care Corporation, jointly and severally, hereby guarantee all the
payment and performance obligations of CompCare de Puerto Rico, Inc. under or relating to this Agreement.
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COMPREHENSIVE BEHAVIORAL CARE, INC.
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COMPREHENSIVE CARE CORPORATION
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By:
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/s/ Clark Marcus
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By:
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/s/ Clark Marcus
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Printed Name:
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Clark Marcus
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Printed Name:
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Clark A. Marcus
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Title:
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Chief Executive Officer
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Title:
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Chairman and CEO
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EXHIBIT 99.1
Comprehensive Care Corporation Receives Rate
Increase on Pharmacy At-Risk Program for Key Client
TAMPA,
Florida March 8, 2012 —
Comprehensive Care Corporation (CompCare) (OTC BB: CHCR), which provides behavioral health, substance abuse and at-risk psychotropic pharmacy management
services for managed care companies throughout the U.S. and Puerto Rico, is pleased to announce that it has signed an amendment to its existing at-risk pharmacy management agreement with a major client serving Medicare members.
CompCare received an 11% rate increase which equates to an annual increase of no less than $3.7 million based on our client’s current membership.
The rate increase has an effective date of January 1, 2012. “The rate increase, along with other initiatives being taken by the Company, results in our Puerto Rico subsidiary achieving immediate profitability starting January 1, 2012,”
said Clark A. Marcus, CompCare’s Chairman and CEO.
Additionally, the client extended the initial two-year term of the contract by an
additional three months to December 31, 2012.
About CompCare:
Established in 1969, CompCare provides behavioral health, substance abuse and psychotropic pharmacy management services for managed care companies throughout the United States. Headquartered in Tampa,
Florida, CompCare focuses on personalized attention, flexibility, a commitment to high-quality services and innovative approaches to behavioral health that address both the specific needs of clients and changing healthcare industry demands. For more
information, please call 813-288-4808 or visit our website at www.compcare.com.
Forward-Looking Statements
Except for statements of historical fact, the matters discussed in this press release are forward looking and made pursuant to the Safe Harbor
provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect numerous assumptions and involve a variety of risks and uncertainties, many of which are beyond our control that may cause actual results to
differ materially from stated expectations. These risk factors include, among others, our ability to execute our business plan, our ability to offer and sell any of our products at a profit, the expected growth in our business and that of our
customers, changes in local, regional, and national economic and political conditions, the effect of governmental regulation, competitive market conditions, varying trends in member utilization, our ability to manage healthcare operating expenses,
our ability to achieve expected results from new business, the profitability, if any, of our capitated contracts, subsidiaries, or other products, increases or variations in cost of care, seasonality, our ability to obtain additional financing,
increased outsourcing of behavioral health services, and additional risk factors as discussed in the reports filed by the company with the Securities and
Exchange Commission, which are available on its website at www.sec.gov. Any
forward- looking statement in this release speaks only as of the date on which it is made. We assume no obligation to update or revise any forward-looking statements.
Investor Contacts:
Paul Knopick
E & E Communications
pknopick@eandecommunications.com
949.707.5365