PainCare Holdings Issues Corporate Update
15 January 2008 - 12:51AM
PR Newswire (US)
ORLANDO, Fla., Jan. 14 /PRNewswire-FirstCall/ -- PainCare Holdings,
Inc. (AMEX:PRZ), one of the nation's leading providers of
pain-focused medical and surgical solutions and services, today
issued a formal corporate update related to its ongoing operations.
* Enterprise-wide cost-cutting program results in 30% decrease in
monthly corporate overhead, dropping from approximately $300,000 to
$200,000. * Changes in executive management to be effected in near
term. * PainCare receives forebearance from senior lender and up to
$1 million cash advance. * Management continues to evaluate
strategies to best leverage assets to meet working capital and
future growth requirements. * Integrated Pain Solutions (IPS)
continues to seek to expand its national provider network and is
actively pursuing new business opportunities with major medical
payor organizations. COST-CUTTING PROGRAM AND SENIOR MANAGEMENT
CHANGES In an effort to further reduce operating expenses, PainCare
has eliminated many cost redundancies within its corporate
operations and across its proprietary network of physician
practices. In addition, the Company has focused on reducing general
corporate staffing levels, resulting in its decreasing corporate
employee headcount from 27 to 18. PainCare has accepted the
resignation of Ronald Riewold as President of PainCare Holdings and
executive member of the Board, effective January 31, 2008.
Replacing Riewold as President is Katie White, current President of
IPS. Riewold will work closely with White through and beyond his
effective resignation date to ensure a seamless transition is
achieved. In addition to her new role as President of PainCare
Holdings, White will also continue to lead IPS. "Since first
assuming the helm at IPS in late 2007, Katie has quickly
distinguished herself as a very dynamic, results-oriented
executive," stated Randy Lubinsky, CEO of PainCare. "But, this did
not come as any surprise. For the past four years, Katie has proved
invaluable to PainCare in her former position as Executive Vice
President, where she played a significant role in business
development, mergers/acquisitions and policy compliance and
management within our Physician Practice Group. Upon taking control
of day- to-day operations at IPS, she immediately applied her
proactive managerial skill to the business, refining and
redefining, as necessary, tactical growth strategies that have led
to a number of new sales opportunities being pursued and the
material expansion of IPS' national provider network. She is the
obvious choice to replace Ron on our executive leadership team. It
should be noted that we will sorely miss Ron, but sincerely wish
him great success in all of his future business endeavors."
FINANCIAL MATTERS On January 11, 2008, PainCare signed a
forbearance agreement with its senior lender, providing for the
lender to forbear from exercising their rights and remedies under
the Company's loan agreements for a period of 120 days. In
addition, the lender has agreed to make cash advances to PainCare
in an aggregate amount of up to $1 million, payable in
predetermined installments through March 31, 2008. All extensions
of credit will be added to the principal balance of the term loans,
which has been reduced to approximately $8.5 million from
approximately $30 million in association with the Company's ongoing
restructuring efforts. In association with its efforts to leverage
existing assets to meet current working capital and future growth
capital needs, management has engaged the services of specialized
investment banking group, Martins Acquisition Group, who has been
charged with marketing the sale of Dynamic Rehabilitation Centers,
Michigan's most comprehensive spinal rehabilitation practice
specializing in the treatment of sub-acute and chronic back and
neck pain. It is also one of the largest, physician-based MedX
rehab facilities in the world. PainCare originally acquired Dynamic
in 2004. The Company intends to continue assessing all other
available strategic alternatives in hopes of further strengthening
its operating platform and providing the necessary financial
resources to support ongoing growth of IPS. With two national
contracts with major payor groups in place and three additional new
contracts in various stages of negotiation, IPS continues to focus
on the expansion of its proprietary provider network, with initial
recruiting and credentialing emphasis in Florida, Tennessee, Texas
and Pennsylvania. "The key to long term success for IPS," said
White, "relies on our ability to establish a national network of
leading physicians and surgeons who share IPS' mission of
delivering higher quality, more efficient quality interventional
pain treatment through utilization of our proven clinical pathways
and the effective administration of patient-centric care and
attention. As our physician network grows, IPS' value proposition
to both the patient and the payor is significantly enhanced, thus
promoting much more dynamic and exponential revenue growth as we
progress our business plan and expand the universe of patients we
are contracted to serve." About PainCare Holdings, Inc.
Headquartered in Orlando, Florida, PainCare Holdings, Inc. is one
of the nation's leading providers of pain-focused medical and
surgical solutions and services. Through its proprietary network of
acquired or managed physician practices, and in partnership with
independent physician practices and medical institutions throughout
the United States and Canada, PainCare is committed to utilizing
the most advanced science and technologies to diagnose and treat
pain stemming from neurological and musculoskeletal conditions and
disorders. Through Integrated Pain Solutions, the Company is
engaged in pioneering the nation's first managed services
organization that offers a multi-disciplinary healthcare network
focused on the treatment of pain. For more information on PainCare
Holdings, please visit http://www.paincareholdings.com/. This press
release contains forward-looking statements that may be subject to
various risks and uncertainties. Such forward-looking statements
are made pursuant to the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995 and are made based on
management's current expectations or beliefs as well as assumptions
made by, and information currently available to, management. These
forward-looking statements, which may include statements regarding
our future financial performance or results of operations,
including expected revenue growth, cash flow growth, future
expenses, future operating margins and other future or expected
performance, are subject to the following risks: the acquisition of
businesses or the launch of new lines of business, which could
increase operating expenses and dilute operating margins; the
inability to attract new patients by our owned practices, the
managed practices and the limited management practice; increased
competition, which could lead to negative pressure on our pricing
and the need for increased marketing; the inability to maintain,
establish or renew relationships with physician practices, whether
due to competition or other factors; the inability to comply with
regulatory requirements governing our owned practices, the managed
practices and the limited management practices; that projected
operating efficiencies will not be achieved due to implementation
difficulties or contractual spending commitments that cannot be
reduced; and to the general risks associated with our businesses.
In addition to the risks and uncertainties discussed above you can
find additional information concerning risks and uncertainties that
would cause actual results to differ materially from those
projected or suggested in the forward-looking statements in the
reports that we have filed with the Securities and Exchange
Commission. The forward-looking statements contained in this press
release represent our judgment as of the date of this release and
you should not unduly rely on such statements. Unless otherwise
required by law, we undertake no obligation to publicly update or
revise any forward- looking statements, whether as a result of new
information, future events or otherwise after the date of this
press release. In light of these risks and uncertainties, the
forward-looking events and circumstances discussed in the filing
may not occur, and actual results could differ materially from
those anticipated or implied in the forward-looking statements. FOR
MORE INFORMATION, PLEASE CONTACT: Investor/Shareholder Relations
Dodi Handy, President and CEO, or Daniel Conway, Chief Strategist
Elite Financial Communications Group, LLC at 407-585-1080 or via
email at DATASOURCE: PainCare Holdings, Inc. CONTACT:
Investor,Shareholder Relations, Dodi Handy, President and CEO, or
Daniel Conway, Chief Strategist, both of Elite Financial
Communications Group, LLC, +1-407-585-1080, Web site:
http://www.paincareholdings.com/
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