|
Delaware
|
0-33169
|
13-4066229
|
(State or other jurisdiction of
Incorporation or organization)
|
Commission
file number
|
(I.R.S. Employer
Identification Number)
|
|
|
|
PAGE
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2014 |
|
December 31,
2013 |
||||
|
(Unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
9,293
|
|
|
$
|
8,055
|
|
Accounts receivable, less allowance for doubtful accounts
of $2,238 in 2014 and $1,651 in 2013 |
106,901
|
|
|
60,750
|
|
||
Income taxes receivable
|
648
|
|
|
538
|
|
||
Prepaid expenses
|
7,752
|
|
|
6,163
|
|
||
Insurance recovery receivable
|
6,507
|
|
|
3,886
|
|
||
Indemnity escrow receivable
|
3,750
|
|
|
3,750
|
|
||
Other current assets
|
749
|
|
|
793
|
|
||
Total current assets
|
135,600
|
|
|
83,935
|
|
||
Property and equipment, net of accumulated depreciation of
$46,642 in 2014 and $44,779 in 2013 |
12,394
|
|
|
6,170
|
|
||
Trade names, net
|
46,501
|
|
|
42,301
|
|
||
Goodwill, net
|
96,034
|
|
|
77,266
|
|
||
Other identifiable intangible assets, net
|
32,829
|
|
|
26,198
|
|
||
Debt issuance costs, net
|
1,260
|
|
|
464
|
|
||
Non-current insurance recovery receivable
|
16,056
|
|
|
10,914
|
|
||
Non-current security deposits
|
705
|
|
|
997
|
|
||
Total assets
|
$
|
341,379
|
|
|
$
|
248,245
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable and accrued expenses
|
$
|
21,717
|
|
|
$
|
10,272
|
|
Accrued compensation and benefits
|
37,046
|
|
|
19,148
|
|
||
Current portion of long-term debt and capital lease obligations
|
11,711
|
|
|
8,483
|
|
||
Sales tax payable
|
2,530
|
|
|
2,404
|
|
||
Deferred tax liabilities
|
622
|
|
|
535
|
|
||
Other current liabilities
|
1,556
|
|
|
4,063
|
|
||
Total current liabilities
|
75,182
|
|
|
44,905
|
|
||
Long-term debt and capital lease obligations
|
53,086
|
|
|
93
|
|
||
Non-current deferred tax liabilities
|
18,475
|
|
|
16,849
|
|
||
Long-term accrued claims
|
28,302
|
|
|
18,303
|
|
||
Long-term deferred purchase price
|
2,500
|
|
|
—
|
|
||
Long-term unrecognized tax benefits
|
2,475
|
|
|
4,013
|
|
||
Other long-term liabilities
|
4,116
|
|
|
3,415
|
|
||
Total liabilities
|
184,136
|
|
|
87,578
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
|
|
||
Common stock
|
3
|
|
|
3
|
|
||
Additional paid-in capital
|
246,637
|
|
|
246,325
|
|
||
Accumulated other comprehensive loss
|
(1,040
|
)
|
|
(970
|
)
|
||
Accumulated deficit
|
(88,655
|
)
|
|
(84,691
|
)
|
||
Total Cross Country Healthcare stockholders' equity
|
156,945
|
|
|
160,667
|
|
||
Non-controlling interest
|
298
|
|
|
—
|
|
||
Total stockholders' equity
|
157,243
|
|
|
160,667
|
|
||
Total liabilities and stockholders' equity
|
$
|
341,379
|
|
|
$
|
248,245
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Revenue from services
|
$
|
122,656
|
|
|
$
|
110,768
|
|
|
$
|
240,747
|
|
|
$
|
221,084
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|||||||
Direct operating expenses
|
90,220
|
|
|
82,930
|
|
|
177,861
|
|
|
164,370
|
|
||||
Selling, general and administrative expenses
|
29,167
|
|
|
26,603
|
|
|
58,622
|
|
|
53,668
|
|
||||
Bad debt expense
|
32
|
|
|
132
|
|
|
464
|
|
|
554
|
|
||||
Depreciation
|
817
|
|
|
1,040
|
|
|
1,791
|
|
|
2,062
|
|
||||
Amortization
|
784
|
|
|
566
|
|
|
1,569
|
|
|
1,132
|
|
||||
Acquisition and integration costs
|
2,747
|
|
|
—
|
|
|
3,042
|
|
|
—
|
|
||||
Restructuring costs
|
755
|
|
|
375
|
|
|
755
|
|
|
375
|
|
||||
Legal settlement charge
|
—
|
|
|
750
|
|
|
—
|
|
|
750
|
|
||||
Total operating expenses
|
124,522
|
|
|
112,396
|
|
|
244,104
|
|
|
222,911
|
|
||||
Loss from operations
|
(1,866
|
)
|
|
(1,628
|
)
|
|
(3,357
|
)
|
|
(1,827
|
)
|
||||
Other expenses (income):
|
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange loss (gain)
|
27
|
|
|
(110
|
)
|
|
74
|
|
|
(101
|
)
|
||||
Interest expense
|
289
|
|
|
164
|
|
|
544
|
|
|
444
|
|
||||
Loss on early extinguishment and modification of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
1,419
|
|
||||
Other (income) expense, net
|
(7
|
)
|
|
10
|
|
|
54
|
|
|
(51
|
)
|
||||
Loss from continuing operations before income taxes
|
(2,175
|
)
|
|
(1,692
|
)
|
|
(4,029
|
)
|
|
(3,538
|
)
|
||||
Income tax expense (benefit)
|
1,006
|
|
|
(257
|
)
|
|
(65
|
)
|
|
(757
|
)
|
||||
Loss from continuing operations
|
(3,181
|
)
|
|
(1,435
|
)
|
|
(3,964
|
)
|
|
(2,781
|
)
|
||||
(Loss) income from discontinued operations, net of income taxes
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
2,482
|
|
||||
Net loss
|
$
|
(3,181
|
)
|
|
$
|
(1,457
|
)
|
|
$
|
(3,964
|
)
|
|
$
|
(299
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic (loss) income per common share from:
|
|
|
|
|
|
|
|
|
|||||||
Continuing operations
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.09
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
0.08
|
|
||||
Net loss
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
||||||||
Diluted (loss) income per common share from:
|
|
|
|
|
|
|
|
|
|||||||
Continuing operations
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.09
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
0.08
|
|
||||
Net loss
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|||||||
Basic
|
31,151
|
|
|
30,961
|
|
|
31,125
|
|
|
30,932
|
|
||||
Diluted
|
31,151
|
|
|
30,961
|
|
|
31,125
|
|
|
30,932
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net loss
|
$
|
(3,181
|
)
|
|
$
|
(1,457
|
)
|
|
$
|
(3,964
|
)
|
|
$
|
(299
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive (loss) income, before tax:
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(3
|
)
|
|
(277
|
)
|
|
92
|
|
|
(285
|
)
|
||||
Reclassification of currency translation adjustments
related to sale of clinical trial services business (see Note 5 - Comprehensive Income) |
—
|
|
|
—
|
|
|
—
|
|
|
2,337
|
|
||||
Other comprehensive (loss) income, before tax
|
(3
|
)
|
|
(277
|
)
|
|
92
|
|
|
2,052
|
|
||||
Income tax (benefit) expense
related to items of other comprehensive income |
—
|
|
|
(99
|
)
|
|
162
|
|
|
(130
|
)
|
||||
Other comprehensive (loss) income, net of tax
|
(3
|
)
|
|
(178
|
)
|
|
(70
|
)
|
|
2,182
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive (loss) income
|
$
|
(3,184
|
)
|
|
$
|
(1,635
|
)
|
|
$
|
(4,034
|
)
|
|
$
|
1,883
|
|
|
Six Months Ended
|
||||||
|
June 30,
|
||||||
|
2014
|
|
2013
|
||||
Operating activities
|
|
|
|
||||
Net loss
|
$
|
(3,964
|
)
|
|
$
|
(299
|
)
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
|
|
|
||||
Depreciation
|
1,791
|
|
|
2,062
|
|
||
Amortization
|
1,569
|
|
|
1,132
|
|
||
Bad debt expense
|
464
|
|
|
559
|
|
||
Loss on early extinguishment and modification of debt
|
—
|
|
|
1,419
|
|
||
Deferred income tax expense
|
1,558
|
|
|
2,505
|
|
||
Amortization of debt issuance costs
|
109
|
|
|
118
|
|
||
Equity compensation
|
542
|
|
|
1,184
|
|
||
Gain on sale of clinical trial services business
|
—
|
|
|
(4,085
|
)
|
||
Other noncash costs
|
99
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(9,198
|
)
|
|
(322
|
)
|
||
Other assets
|
61
|
|
|
(328
|
)
|
||
Income taxes
|
(2,636
|
)
|
|
(1,487
|
)
|
||
Accounts payable and accrued expenses
|
4,820
|
|
|
1,234
|
|
||
Other liabilities
|
(746
|
)
|
|
706
|
|
||
Net cash (used in) provided by operating activities
|
(5,531
|
)
|
|
4,398
|
|
||
|
|
|
|
||||
|
|
|
|
||||
Investing activities
|
|
|
|
|
|
||
Proceeds from sale of clinical trial services business segment, net of cash sold and transaction costs
|
—
|
|
|
45,897
|
|
||
Acquisition of assets of Medical Staffing Network, net of cash acquired
|
(45,359
|
)
|
|
—
|
|
||
Purchases of property and equipment
|
(2,849
|
)
|
|
(427
|
)
|
||
Net cash (used in) provided by investing activities
|
(48,208
|
)
|
|
45,470
|
|
||
|
|
|
|
||||
Financing activities
|
|
|
|
|
|
||
Principal repayments on term loan
|
—
|
|
|
(23,125
|
)
|
||
Proceeds from borrowing on term loan
|
28,875
|
|
|
—
|
|
||
Proceeds from borrowing on convertible note
|
24,063
|
|
|
—
|
|
||
Repayments on revolving credit facility
|
—
|
|
|
(10,000
|
)
|
||
Repayments on asset-based revolving credit facility
|
(27,700
|
)
|
|
(49,244
|
)
|
||
Borrowings under asset-based revolving credit facility
|
30,905
|
|
|
49,244
|
|
||
Principal payments on capital lease obligations and note payable
|
(70
|
)
|
|
(349
|
)
|
||
Repurchase of stock for restricted stock tax withholdings
|
(229
|
)
|
|
(301
|
)
|
||
Debt issuance costs
|
(905
|
)
|
|
(506
|
)
|
||
Net cash provided by (used in) financing activities
|
54,939
|
|
|
(34,281
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash
|
38
|
|
|
(135
|
)
|
||
|
|
|
|
||||
Change in cash and cash equivalents
|
1,238
|
|
|
15,452
|
|
||
Cash and cash equivalents at beginning of period
|
8,055
|
|
|
10,463
|
|
||
Cash and cash equivalents at end of period
|
$
|
9,293
|
|
|
$
|
25,915
|
|
1.
|
ORGANIZATION AND BASIS OF PRESENTATION
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
(amounts in thousands)
|
||
Cash acquired
|
$
|
462
|
|
Accounts receivables, net
|
37,417
|
|
|
Other current assets
|
3,012
|
|
|
Property and equipment
|
5,113
|
|
|
Goodwill
|
18,768
|
|
|
Other intangible assets
|
12,400
|
|
|
Other assets
|
2,326
|
|
|
Total assets acquired
|
79,498
|
|
|
|
|
||
Accounts payable
|
7,269
|
|
|
Accrued employee compensation and benefits
|
14,013
|
|
|
Other liabilities
|
9,867
|
|
|
Total liabilities assumed
|
31,149
|
|
|
|
|
||
Non-controlling interest
|
298
|
|
|
|
|
||
Net assets acquired
|
$
|
48,051
|
|
|
(amounts in thousands)
|
||
Other current assets
|
$
|
62
|
|
Property and equipment
|
161
|
|
|
Goodwill
|
14,554
|
|
|
Other intangible assets
|
14,000
|
|
|
Other assets
|
52
|
|
|
Total assets acquired
|
28,829
|
|
|
|
|
||
Accrued employee compensation and benefits
|
112
|
|
|
Total liabilities assumed
|
112
|
|
|
|
|
||
Net assets acquired
|
$
|
28,717
|
|
|
|
Six Months Ended
|
|
Six Months Ended
|
||||
|
|
June 30, 2014
|
|
June 30, 2013
|
||||
|
|
(unaudited, amounts in thousands)
|
||||||
|
|
|
|
|
||||
Revenue from services
|
|
$
|
362,818
|
|
|
$
|
354,951
|
|
|
|
|
|
|
||||
Net loss
|
|
$
|
(1,978
|
)
|
|
$
|
(2,524
|
)
|
|
|
|
|
|
||||
Net loss per common share - basic
|
|
$
|
(0.06
|
)
|
|
$
|
(0.08
|
)
|
|
|
|
|
|
||||
Net loss per common share - diluted
|
|
$
|
(0.06
|
)
|
|
$
|
(0.08
|
)
|
4.
|
DISCONTINUED OPERATIONS
|
|
Three Months Ended
|
|
Six Months Ended
|
||||
June 30, 2013
|
|
June 30, 2013
|
|||||
|
(amounts in thousands)
|
||||||
|
|
|
|
||||
Revenue
|
$
|
—
|
|
|
$
|
7,939
|
|
|
|
|
|
||||
Income from discontinued operations before gain on sale and income taxes
|
—
|
|
|
483
|
|
||
(Loss) gain on sale of discontinued operations
|
(73
|
)
|
|
4,085
|
|
||
Income tax benefit (expense)
|
51
|
|
|
(2,086
|
)
|
||
(Loss) income from discontinued operations,
net of income taxes |
$
|
(22
|
)
|
|
$
|
2,482
|
|
5.
|
COMPREHENSIVE INCOME
|
6.
|
EARNINGS PER SHARE
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
June 30,
|
|
June 30,
|
|||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
|||||||||
|
(amounts in thousands, except per share data)
|
||||||||||||||
Loss from continuing operations
|
$
|
(3,181
|
)
|
|
$
|
(1,435
|
)
|
|
$
|
(3,964
|
)
|
|
$
|
(2,781
|
)
|
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
2,482
|
|
||||
Net loss
|
$
|
(3,181
|
)
|
|
$
|
(1,457
|
)
|
|
$
|
(3,964
|
)
|
|
$
|
(299
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic (loss) income per common share from:
|
|
|
|
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.09
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
0.08
|
|
||||
Net loss
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
||||||||
Diluted (loss) income per common share from:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Continuing operations
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.09
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
0.08
|
|
||||
Net loss
|
$
|
(0.10
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
31,151
|
|
|
30,961
|
|
|
31,125
|
|
|
30,932
|
|
||||
Diluted
|
31,151
|
|
|
30,961
|
|
|
31,125
|
|
|
30,932
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
|
Gross
Carrying Amount |
|
Gross
Carrying Amount |
|
Net
Carrying Amount |
||||||||||||
|
(amounts in thousands)
|
||||||||||||||||||||||
Intangible assets subject to amortization (a):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Databases
|
$
|
22,625
|
|
|
$
|
12,336
|
|
|
$
|
10,289
|
|
|
$
|
15,925
|
|
|
$
|
12,103
|
|
|
$
|
3,822
|
|
Customer relationships
|
38,804
|
|
|
16,440
|
|
|
22,364
|
|
|
37,304
|
|
|
15,125
|
|
|
22,179
|
|
||||||
Non-compete agreements
|
3,603
|
|
|
3,427
|
|
|
176
|
|
|
3,603
|
|
|
3,406
|
|
|
197
|
|
||||||
|
$
|
65,032
|
|
|
$
|
32,203
|
|
|
$
|
32,829
|
|
|
$
|
56,832
|
|
|
$
|
30,634
|
|
|
$
|
26,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Intangible assets not subject to amortization (a):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Goodwill
|
|
|
|
|
|
|
$
|
96,034
|
|
|
|
|
|
|
|
|
$
|
77,266
|
|
||||
Trade Names
|
|
|
|
|
|
|
46,501
|
|
|
|
|
|
|
|
|
42,301
|
|
||||||
|
|
|
|
|
|
|
$
|
142,535
|
|
|
|
|
|
|
|
|
$
|
119,567
|
|
(a)
|
Based on the timing of the MSN Acquisition, the estimated fair value of the intangible assets was recorded based on a preliminary valuation analysis. See Note 3 - Acquisitions.
|
|
Nurse
And Allied Staffing |
|
Physician
Staffing |
|
Other Human
Capital Management Services |
|
Total
|
||||||||
|
(amounts in thousands)
|
||||||||||||||
Balances as of December 31, 2013
|
|
|
|
|
|
|
|
||||||||
Aggregate goodwill acquired
|
$
|
274,286
|
|
|
$
|
43,405
|
|
|
$
|
19,307
|
|
|
$
|
336,998
|
|
Accumulated impairment loss (a)
|
(259,732
|
)
|
|
—
|
|
|
—
|
|
|
(259,732
|
)
|
||||
Goodwill, net of impairment loss
|
14,554
|
|
|
43,405
|
|
|
19,307
|
|
|
77,266
|
|
||||
Changes to aggregate goodwill in 2014
|
|
|
|
|
|
|
|
|
|
|
|
||||
Goodwill acquired (b)
|
18,768
|
|
|
—
|
|
|
—
|
|
|
18,768
|
|
||||
Balances as of June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
||||
Aggregate goodwill acquired
|
293,054
|
|
|
43,405
|
|
|
19,307
|
|
|
355,766
|
|
||||
Accumulated impairment loss
|
(259,732
|
)
|
|
—
|
|
|
—
|
|
|
(259,732
|
)
|
||||
Goodwill, net of impairment loss
|
$
|
33,322
|
|
|
$
|
43,405
|
|
|
$
|
19,307
|
|
|
$
|
96,034
|
|
(a)
|
A non-cash pretax impairment charge of approximately
$241.0 million
was recorded to reduce the carrying value of goodwill to its estimated fair value in the fourth quarter of 2008 for its nurse and allied staffing business segment. The majority of the goodwill impairment was attributable to the Company’s initial capitalization in 1999, which was accounted for as an asset purchase, and subsequent nurse staffing acquisitions made through 2003. In addition, in the second quarter of 2012, a non-cash pretax impairment charge of approximately
$18.7 million
was recorded for the Company’s nurse and allied staffing reporting unit.
|
(b)
|
Preliminary goodwill acquired from the acquisition of Medical Staffing Network. Due to the time of the acquisition, the final goodwill calculation is incomplete. See Note 3 - Acquisitions.
|
|
June 30,
|
|
December 31,
|
||||
|
2014
|
|
2013
|
||||
|
(amounts in thousands)
|
||||||
Senior Secured Asset-Based, interest 1.77% and 3.27% at June 30, 2014 and December 31, 2013, respectively
|
$
|
11,605
|
|
|
$
|
8,400
|
|
Second Lien Term Loan, net of unamortized discount of $1,125, interest 7.50% at June 30, 2014
|
28,875
|
|
|
—
|
|
||
Convertible Notes, net of unamortized discount of $7,702, interest 8.00% at June 30, 2014
|
17,298
|
|
|
—
|
|
||
Convertible note derivative liability
|
6,765
|
|
|
—
|
|
||
Capital lease obligations
|
254
|
|
|
176
|
|
||
|
|
|
|
||||
Total debt
|
64,797
|
|
|
8,576
|
|
||
Less current portion
|
(11,711
|
)
|
|
(8,483
|
)
|
||
Long-term debt
|
$
|
53,086
|
|
|
$
|
93
|
|
10.
|
FAIR VALUE MEASUREMENTS
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
Financial Liabilities:
|
(amounts in thousands)
|
||||||
(Level 1)
|
|
|
|
|
|
||
Deferred compensation
|
$
|
1,424
|
|
|
$
|
1,638
|
|
(Level 3)
|
|
|
|
||||
Convertible Notes derivative liability (a)
|
6,765
|
|
|
—
|
|
(a)
|
Embedded derivative included in long-term debt on the condensed consolidated balance sheets. See Note 9 - Convertible Notes Derivative Liability for further information.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Carrying
Amount |
|
Fair
Value |
|
Carrying
Amount |
|
Fair
Value |
||||||||
(Level 2)
|
|
|
(amounts in thousands)
|
|
|
||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
||||||||
Escrow Receivable
|
$
|
3,750
|
|
|
$
|
3,750
|
|
|
$
|
3,750
|
|
|
$
|
3,700
|
|
Financial Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Second Lien Term Loan, net
|
$
|
28,875
|
|
|
$
|
28,875
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Convertible Notes, net
|
$
|
17,298
|
|
|
$
|
17,298
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Senior Secured Asset-Based (a)
|
$
|
11,605
|
|
|
$
|
11,605
|
|
|
$
|
8,400
|
|
|
$
|
8,400
|
|
(a)
|
Carrying value of the Senior Secured Asset-Based approximates estimated fair value based on the short-term nature and the pricing at varying interest rates.
|
11.
|
STOCKHOLDERS’ EQUITY
|
•
|
Increase of the Aggregate Share Reserve. The aggregate share reserve was increased by an additional
600,000
shares for a total share reserve of
4,100,000
shares under the Omnibus Plan.
|
•
|
Removal of Non-Appreciation Award Limit. In connection with the increase in the aggregate share reserve, the limit on the number of awards that are not “appreciation awards” (i.e., restricted stock and restricted stock units) that may be granted under the Omnibus Plan was removed.
|
•
|
Performance-Based Cash Awards. The Omnibus Plan includes performance-based cash awards that may be granted with the intent to comply with the “performance-based compensation” exception under Section 162(m) of the Internal Revenue Code.
|
•
|
Term Extension. The term of the Amended Plan was extended until March 10, 2024 (the 2007 Stock Incentive Plan was scheduled to expire on April 5, 2017).
|
•
|
Added pre-tax income as a metric to measure performance based equity awards.
|
|
Restricted Stock Awards
|
|
Performance Stock Awards
|
||||||||||
|
Number of
Shares |
|
Weighted
Average Grant Date Fair Value |
|
Number of Target
Shares |
|
Weighted
Average Grant Date Fair Value |
||||||
Unvested restricted stock awards, January 1, 2014
|
552,231
|
|
|
$
|
5.37
|
|
|
—
|
|
|
$
|
—
|
|
Granted
|
351,240
|
|
|
$
|
6.03
|
|
|
239,585
|
|
|
$
|
5.81
|
|
Vested
|
(173,479
|
)
|
|
$
|
5.78
|
|
|
—
|
|
|
$
|
—
|
|
Forfeited
|
(78,623
|
)
|
|
$
|
5.37
|
|
|
(14,623
|
)
|
|
$
|
5.77
|
|
Unvested restricted stock awards, June 30, 2014
|
651,369
|
|
|
$
|
5.62
|
|
|
224,962
|
|
|
$
|
5.82
|
|
12.
|
SEGMENT DATA
|
●
|
Nurse and allied staffing
- The nurse and allied staffing segment provides traditional staffing, including temporary and permanent placement of travel nurses and allied professionals, and branch-based local nurses and allied staffing. Its clients include: public and private acute-care and non-acute care hospitals, government facilities, schools, outpatient clinics, ambulatory care facilities, retailers, and many other healthcare providers throughout the U.S. The Company aggregates its various brands that it markets to its customers in this business segment.
|
●
|
Physician staffing
– The physician staffing business segment provides physicians in many specialties, certified registered nurse anesthetists (CRNAs), nurse practitioners (NPs) and physician assistants (PAs) under the Company's Medical Doctor Associates (MDA) brand as independent contractors on temporary assignments throughout the U.S. at various healthcare facilities, such as acute and non-acute care facilities, medical group practices, government facilities, and managed care organizations. The physician staffing business also provides certain other employees on a temporary basis to its customers.
|
●
|
Other human capital management services
- The other human capital management services business segment provides education and training programs to the healthcare industry and retained search services for physicians and healthcare executives within the U.S.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013 (a)
|
|
2014
|
|
2013 (a)
|
||||||||
|
(amounts in thousands)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Nurse and allied staffing
|
$
|
82,616
|
|
|
$
|
65,656
|
|
|
$
|
162,809
|
|
|
$
|
136,729
|
|
Physician staffing
|
30,849
|
|
|
34,837
|
|
|
59,985
|
|
|
64,580
|
|
||||
Other human capital management services
|
9,191
|
|
|
10,275
|
|
|
17,953
|
|
|
19,775
|
|
||||
|
$
|
122,656
|
|
|
$
|
110,768
|
|
|
$
|
240,747
|
|
|
$
|
221,084
|
|
|
|
|
|
|
|
|
|
||||||||
Contribution income (b):
|
|
|
|
|
|
|
|
||||||||
Nurse and allied staffing (c)
|
$
|
6,652
|
|
|
$
|
3,493
|
|
|
$
|
12,621
|
|
|
$
|
8,667
|
|
Physician staffing
|
1,874
|
|
|
2,562
|
|
|
2,625
|
|
|
4,788
|
|
||||
Other human capital management services
|
(232
|
)
|
|
534
|
|
|
(66
|
)
|
|
824
|
|
||||
|
8,294
|
|
|
6,589
|
|
|
15,180
|
|
|
14,279
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||
Unallocated corporate overhead (c)
|
5,057
|
|
|
5,486
|
|
|
11,380
|
|
|
11,787
|
|
||||
Depreciation
|
817
|
|
|
1,040
|
|
|
1,791
|
|
|
2,062
|
|
||||
Amortization
|
784
|
|
|
566
|
|
|
1,569
|
|
|
1,132
|
|
||||
Acquisition and integration costs
|
2,747
|
|
|
—
|
|
|
3,042
|
|
|
—
|
|
||||
Restructuring costs
|
755
|
|
|
375
|
|
|
755
|
|
|
375
|
|
||||
Legal settlement charge
|
—
|
|
|
750
|
|
|
—
|
|
|
750
|
|
||||
Loss from operations
|
$
|
(1,866
|
)
|
|
$
|
(1,628
|
)
|
|
$
|
(3,357
|
)
|
|
$
|
(1,827
|
)
|
(a)
|
Prior year data has been reclassified to conform to the current year's presentation. Effective January 1, 2014, the Company merged its Allied Health Group, LLC subsidiary with its Medical Doctor Associates, LLC subsidiary. The decision to merge these companies was based on a number of factors including the consolidation of back office processes and other operational efficiencies. Along with this merger, the Company evaluated the Allied Health Group trade name and determined that it would be more valuable to use it for the Company’s nurse and allied staffing business, and as a result, transferred the trade name effective January 1, 2014.
|
(b)
|
The Company defines contribution income as income or loss from operations before depreciation, amortization, acquisition and integration costs, restructuring costs, legal settlement charges, impairment charges and corporate expenses not specifically identified to a reporting segment. Contribution income is a financial measure used by management when assessing segment performance and is provided in accordance with ASC 280,
Segment Reporting
.
|
(c)
|
In 2014, the Company refined its methodology for allocating certain corporate overhead expenses to its nurse and allied staffing segment to more accurately reflect this segment’s profitability. Prior year information has been reclassified to conform to current year presentation.
|
Through Year Ending December 31:
|
(amounts in thousands)
|
||
2014
|
$
|
3,868
|
|
2015
|
6,774
|
|
|
2016
|
5,381
|
|
|
2017
|
3,778
|
|
|
2018
|
1,619
|
|
|
Thereafter
|
2,623
|
|
|
|
$
|
24,043
|
|
14.
|
INCOME TAXES
|
Balance at January 1, 2014
|
$
|
4,986
|
|
Reductions based on tax positions related to prior years
|
(8
|
)
|
|
Additions based on tax positions related to current year
|
317
|
|
|
Settlements of tax positions related to prior years
|
(344
|
)
|
|
Balance at June 30, 2014
|
$
|
4,951
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
●
|
Nurse and allied staffing
- The nurse and allied staffing segment provides traditional staffing, including temporary and permanent placement of travel nurses and allied professionals, and branch-based local nurses and allied staffing. Its clients include: public and private acute-care and non-acute care hospitals, government facilities, schools, outpatient clinics, ambulatory care facilities, retailers, and many other healthcare providers throughout the U.S. The Company aggregates various brands that it markets to its customers in this business segment.
|
●
|
Physician staffing
– The physician staffing business segment provides physicians in many specialties, certified registered nurse anesthetists (CRNAs), nurse practitioners (NPs) and physician assistants (PAs) under the Company's Medical Doctor Associates (MDA) brand as independent contractors on temporary assignments throughout the U.S. at various healthcare facilities, such as acute and non-acute care facilities, medical group practices, government facilities, and managed care organizations.
|
●
|
Other human capital management services
- The other human capital management services business segment provides education and training programs to the healthcare industry and retained search services for physicians and healthcare executives within the U.S.
|
Business Segment
|
Business Measurement
|
Nurse and Allied Staffing
|
FTEs
represent the average number of nurse and allied contract personnel on a full-time equivalent basis.
|
|
Average Revenue per FTE per Day
is calculated by dividing the nurse and allied staffing revenue by the number of days worked in the respective periods. Nurse and allied staffing revenue also includes revenue from the permanent placement of nurses.
|
|
|
Physician Staffing
|
Days filled
is calculated by dividing the total hours filled during the period by 8 hours.
|
|
Revenue per day filled
is calculated by dividing the actual revenue invoiced (excluding permanent placement fees) by the Company's physician staffing segment by days filled for the period presented.
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
June 30,
|
|
June 30,
|
|
|
|
Percent
|
||||||
|
2014
|
|
2013
|
|
Change
|
|
Change
|
||||||
|
|
|
|
|
|
|
|
||||||
Nurse and allied staffing statistical data:
|
|
|
|
|
|
|
|
||||||
FTEs
|
3,177
|
|
|
2,300
|
|
|
877
|
|
|
38.1
|
%
|
||
Average nurse and allied staffing revenue per FTE per day
|
$
|
286
|
|
|
$
|
314
|
|
|
(28
|
)
|
|
(8.9
|
)%
|
|
|
|
|
|
|
|
|
||||||
Physician staffing statistical data:
|
|
|
|
|
|
|
|
||||||
Days filled
|
21,147
|
|
|
24,462
|
|
|
(3,315
|
)
|
|
(13.6
|
)%
|
||
Revenue per day filled
|
$
|
1,444
|
|
|
$
|
1,405
|
|
|
39
|
|
|
2.8
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
June 30,
|
|
June 30,
|
||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Revenue from services
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Direct operating expenses
|
73.6
|
|
|
74.9
|
|
|
73.9
|
|
|
74.3
|
|
Selling, general and administrative expenses
|
23.8
|
|
|
24.0
|
|
|
24.4
|
|
|
24.3
|
|
Bad debt expense
|
—
|
|
|
0.1
|
|
|
0.2
|
|
|
0.3
|
|
Depreciation and amortization
|
1.3
|
|
|
1.4
|
|
|
1.4
|
|
|
1.4
|
|
Acquisition and integration costs
|
2.2
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
Restructuring costs
|
0.6
|
|
|
0.4
|
|
|
0.3
|
|
|
0.2
|
|
Legal settlement charge
|
—
|
|
|
0.7
|
|
|
—
|
|
|
0.3
|
|
Loss from operations
|
(1.5
|
)
|
|
(1.5
|
)
|
|
(1.5
|
)
|
|
(0.8
|
)
|
Foreign exchange loss (gain)
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
Interest expense
|
0.3
|
|
|
0.1
|
|
|
0.2
|
|
|
0.2
|
|
Loss on early extinguishment and modification of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
Loss from continuing operations before income taxes
|
(1.8
|
)
|
|
(1.5
|
)
|
|
(1.7
|
)
|
|
(1.6
|
)
|
Income tax expense (benefit)
|
0.8
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.3
|
)
|
Loss from continuing operations
|
(2.6
|
)
|
|
(1.3
|
)
|
|
(1.7
|
)
|
|
(1.3
|
)
|
(Loss) income from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
1.1
|
|
Net loss
|
(2.6
|
)%
|
|
(1.3
|
)%
|
|
(1.7
|
)%
|
|
(0.2
|
)%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013 (a)
|
|
2014
|
|
2013 (a)
|
||||||||
|
(amounts in thousands)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|||||
Nurse and allied staffing
|
$
|
82,616
|
|
|
$
|
65,656
|
|
|
$
|
162,809
|
|
|
$
|
136,729
|
|
Physician staffing
|
30,849
|
|
|
34,837
|
|
|
59,985
|
|
|
64,580
|
|
||||
Other human capital management services
|
9,191
|
|
|
10,275
|
|
|
17,953
|
|
|
19,775
|
|
||||
|
$
|
122,656
|
|
|
$
|
110,768
|
|
|
$
|
240,747
|
|
|
$
|
221,084
|
|
|
|
|
|
|
|
|
|
||||||||
Contribution income (b):
|
|
|
|
|
|
|
|
||||||||
Nurse and allied staffing (c)
|
$
|
6,652
|
|
|
$
|
3,493
|
|
|
$
|
12,621
|
|
|
$
|
8,667
|
|
Physician staffing
|
1,874
|
|
|
2,562
|
|
|
2,625
|
|
|
4,788
|
|
||||
Other human capital management services
|
(232
|
)
|
|
534
|
|
|
(66
|
)
|
|
824
|
|
||||
|
8,294
|
|
|
6,589
|
|
|
15,180
|
|
|
14,279
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Unallocated corporate overhead (c)
|
5,057
|
|
|
5,486
|
|
|
11,380
|
|
|
11,787
|
|
||||
Depreciation
|
817
|
|
|
1,040
|
|
|
1,791
|
|
|
2,062
|
|
||||
Amortization
|
784
|
|
|
566
|
|
|
1,569
|
|
|
1,132
|
|
||||
Acquisition and integration costs
|
2,747
|
|
|
—
|
|
|
3,042
|
|
|
—
|
|
||||
Restructuring costs
|
755
|
|
|
375
|
|
|
755
|
|
|
375
|
|
||||
Legal settlement charge
|
—
|
|
|
750
|
|
|
—
|
|
|
750
|
|
||||
Loss from operations
|
$
|
(1,866
|
)
|
|
$
|
(1,628
|
)
|
|
$
|
(3,357
|
)
|
|
$
|
(1,827
|
)
|
(a)
|
Prior year data has been reclassified to conform to the current year's presentation. Effective January 1, 2014, we merged our Allied Health Group, LLC subsidiary with Medical Doctor Associates, LLC subsidiary. The decision to merge these companies was based on a number of factors including the consolidation of back office processes and other operational efficiencies. Along with this merger, we evaluated the Allied Health Group trade name and determined that it would be more valuable to use it for our nurse and allied staffing business, and as a result, transferred the trade name effective January 1, 2014.
|
(b)
|
We define contribution income or loss from operations before depreciation, amortization, acquisition and integration costs, restructuring costs, legal settlement charges, impairment charges, and other corporate expenses not specifically identified to a reporting segment. Contribution income is a measure used by management to access operations and is provided in accordance with ASC 280,
Segment Reporting
.
|
(c)
|
In 2014, we refined our methodology for allocating certain corporate overhead expenses to our nurse and allied staffing segment to more accurately reflect this segment’s profitability. Prior year information has been reclassified to conform to current year presentation.
|
•
|
Increase of the Aggregate Share Reserve. The aggregate share reserve was increased by an additional 600,000 shares for a total share reserve of 4,100,000 shares under the Omnibus Plan.
|
•
|
Removal of Non-Appreciation Award Limit. In connection with the increase in the aggregate share reserve, the limit on the number of awards that are not “appreciation awards” (i.e., restricted stock and restricted stock units) that may be granted under the Omnibus Plan was removed.
|
•
|
Performance-Based Cash Awards. The Omnibus Plan includes performance-based cash awards that may be granted with the intent to comply with the “performance-based compensation” exception under Section 162(m) of the Code.
|
•
|
Term Extension. The term of the Amended Plan was extended until March 10, 2024 (the 2007 Stock Incentive Plan was scheduled to expire on April 5, 2017).
|
•
|
Added pre-tax income as a metric to measure performance based equity awards.
|
Commitments
|
Total
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
||||||||||||||
|
(amounts in thousands)
|
||||||||||||||||||||||||||
Senior Secured Asset-Based (a)
|
$
|
11,605
|
|
|
$
|
11,605
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Second Lien Term Loan (a)
|
30,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,000
|
|
|||||||
Convertible Notes
|
25,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,000
|
|
|||||||
Capital lease obligations
|
254
|
|
|
53
|
|
|
107
|
|
|
71
|
|
|
13
|
|
|
8
|
|
|
2
|
|
|||||||
Operating leases obligations (b)
|
24,043
|
|
|
3,868
|
|
|
6,774
|
|
|
5,381
|
|
|
3,778
|
|
|
1,619
|
|
|
2,623
|
|
|||||||
|
$
|
90,902
|
|
|
$
|
15,526
|
|
|
$
|
6,881
|
|
|
$
|
5,452
|
|
|
$
|
3,791
|
|
|
$
|
1,627
|
|
|
$
|
57,625
|
|
(a)
|
Under our Senior Secured Asset-Based and Second Lien Term Loan, we are required to comply with certain financial covenants. Our inability to comply with the required covenants or other provisions could result in default under our credit facility. In the event of any such default and our inability to obtain a waiver of the default, all amounts outstanding could be declared immediately due and payable.
|
(b)
|
Represents future minimum lease payments associated with operating lease agreements with original terms of more than one year.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
|
June 30, 2014
|
|
|
(amounts in thousands)
|
|
|
|
|
Total principal amount of indebtedness
|
98,359
|
|
Stockholders' equity
|
156,945
|
|
•
|
we may be more vulnerable to general adverse economic and industry conditions;
|
•
|
we may have to pay higher interest rates upon refinancing or on our variable rate indebtedness if interest rates rise, thereby reducing our cash flows;
|
•
|
we may find it more difficult to obtain additional financing to fund future working capital, capital expenditures and other general corporate requirements that would be in our best long-term interests;
|
•
|
we may be required to dedicate a substantial portion of our cash flow from operations to the payment of principal and interest on our debt, reducing the available cash flow to fund other investments,;
|
•
|
we may have limited flexibility in planning for, or reacting to, changes in our business or in the industry;
|
•
|
we may have a competitive disadvantage relative to other companies in our industry that are less leveraged; and
|
•
|
we may be required to sell debt or equity securities or sell some of our core assets, possibly on unfavorable terms, in order to meet payment obligations.
|
ITEM 6.
|
EXHIBITS
|
|
CROSS COUNTRY HEALTHCARE, INC.
|
|
|
|
|
Date: August 8, 2014
|
By:
|
/s/ William J. Burns
|
|
|
William J. Burns
Chief Financial Officer
(Principal Financial Officer)
|
|
CROSS COUNTRY HEALTHCARE, INC.
|
|
|
|
|
Date: August 8, 2014
|
By:
|
/s/ Nicholas Buscemi III
|
|
|
Nicholas Buscemi III
Chief Accounting Officer
(Principal Accounting Officer)
|
No.
|
|
Description
|
|
|
|
*4.1
|
|
2014 Omnibus Incentive Plan - Restricted Stock Agreement Form
|
|
|
|
*4.2
|
|
2014 Omnibus Incentive Plan - Performance Share and Restricted Stock Agreement Form
|
|
|
|
*31.1
|
|
Certification pursuant to Rule 13a-14(a) and Rule 15d-14 (a) by William J. Grubbs, President and Chief Executive Officer
|
|
|
|
*31.2
|
|
Certification pursuant to Rule 13a-14(a) and Rule 15d-14 (a) by William J. Burns, Chief Financial Officer
|
|
|
|
*32.1
|
|
Certification pursuant to 18 U.S.C. Section 1350 by William J. Grubbs, President and Chief Executive Officer
|
|
|
|
*32.2
|
|
Certification pursuant to 18 U.S.C. Section 1350 by William J. Burns, Chief Financial Officer
|
|
|
|
**101.INS
|
|
XBRL Instance Document
|
|
|
|
**101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
**101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
**101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
**101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
**101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
*
|
|
Filed herewith
|
|
|
|
**
|
|
Furnished herewith
|
Vesting Date
|
Percentage Vested
|
First Anniversary of Grant Date
|
33.33%
|
Second Anniversary of Grant Date
|
33.33%
|
Third Anniversary of Grant Date
|
33.34%
|
PARTICIPANT:
_____________________________
First and Last Name
|
CROSS COUNTRY HEALTHCARE, INC.
By:_________________________________
|
PARTICIPANT:
_____________________________
First and Last Name
|
CROSS COUNTRY HEALTHCARE, INC.
By:_________________________________
Name:
Title:
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cross Country Healthcare, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 8, 2014
|
/s/ William J. Grubbs
|
|
|
William J. Grubbs
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cross Country Healthcare, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 8, 2014
|
/s/ William J. Burns
|
|
|
William J. Burns
Chief Financial Officer
|
Date:
|
August 8, 2014
|
/s/ William J. Grubbs
|
|
|
William J. Grubbs
President and Chief Executive Officer
|
Date:
|
August 8, 2014
|
/s/ William J. Burns
|
|
|
William J. Burns
Chief Financial Officer
|