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UNITED STATES
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SECURITIES AND EXCHANGE COMMISSION
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Washington, D.C. 20549
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SCHEDULE 13D
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Under the Securities Exchange Act
of 1934
(Amendment No. 1)*
Prospect
Medical Holdings, Inc.
(Name of Issuer)
Common
Stock, par value $.01 per share
(Title of Class of
Securities)
(CUSIP Number)
David
R. Topper
c/o
Alta Hospitals System, LLC
10780
Santa Monica Blvd., Suite 400
Los
Angeles, CA 90025
(Name, Address and
Telephone Number of Person
Authorized to Receive Notices and Communications)
(Date of Event Which
Requires Filing of this Statement)
If the filing person has previously filed a statement
on Schedule 13G to report the acquisition that is the subject of this Schedule
13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box.
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Note
: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7 for other
parties to whom copies are to be sent.
*
The remainder of this cover page shall
be filled out for a reporting person's initial filing on this form with respect
to the subject class of securities, and for any subsequent amendment containing
information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this
cover page shall not be deemed to be "filed" for the purpose of
Section 18 of the Securities Exchange Act of 1934 ("Act") or
otherwise subject to the liabilities of that section of the Act but shall be
subject to all other provisions of the Act (however, see the Notes).
CUSIP No.
743494106
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1.
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Names of Reporting Persons
David R. Topper
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2.
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Check the Appropriate Box
if a Member of a Group (See Instructions)
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(a)
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o
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(b)
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x
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3.
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SEC Use Only
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4.
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Source of Funds (See
Instructions)
OO (SEE RESPONSE TO ITEM 3)
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5.
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Check if Disclosure of Legal Proceedings Is
Required Pursuant to Items 2(d) or 2(e)
o
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6.
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Citizenship or Place of Organization
USA
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Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With
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7.
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Sole Voting Power
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8.
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Shared Voting Power
5,125,768 (SEE RESPONSES TO ITEMS 4 AND 5)
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9.
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Sole Dispositive Power
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10.
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Shared Dispositive Power
5,125,768
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11.
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Aggregate Amount
Beneficially Owned by Each Reporting Person
5,125,768
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12.
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Check if the Aggregate
Amount in Row (11) Excludes Certain Shares (See Instructions)
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13.
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Percent of Class
Represented by Amount in Row (11)
25.4%*
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14.
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Type of Reporting Person
(See Instructions)
IN
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* Based on 20,146,967 shares of Common Stock outstanding (comprised of
the aggregate of 11,782,567 shares of Common Stock outstanding as of July 8,
2008 (as reported by the Issuer in its 2008 Proxy Statement filed July 10,
2008) and 8,364,400 shares of Common Stock issued to the Shareholders on August
13, 2008 pursuant to the conversion of the Issuers outstanding 1,672,880
shares of Series B Preferred Stock (as such capitalized terms are hereinafter
defined)).
2
CUSIP No.
743494106
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1.
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Names of Reporting Persons
Alexa Topper
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2.
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Check the Appropriate Box
if a Member of a Group (See Instructions)
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(a)
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o
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(b)
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x
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3.
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SEC Use Only
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4.
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Source of Funds (See
Instructions)
OO (SEE RESPONSE TO ITEM 3)
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5.
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Check if Disclosure of Legal Proceedings Is
Required Pursuant to Items 2(d) or 2(e)
o
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6.
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Citizenship or Place of Organization
USA
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Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With
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7.
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Sole Voting Power
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8.
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Shared Voting Power
5,125,768 (SEE RESPONSES TO ITEMS 4 AND 5)
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9.
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Sole Dispositive Power
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10.
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Shared Dispositive Power
5,125,768
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11.
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Aggregate Amount
Beneficially Owned by Each Reporting Person
5,125,768
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12.
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Check if the Aggregate
Amount in Row (11) Excludes Certain Shares (See Instructions)
o
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13.
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Percent of Class
Represented by Amount in Row (11)
25.4%*
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14.
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Type of Reporting Person
(See Instructions)
IN
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* Based on 20,146,967 shares of Common Stock outstanding (comprised of
the aggregate of 11,782,567 shares of Common Stock outstanding as of July 8,
2008 (as reported by the Issuer in its 2008 Proxy Statement filed July 10,
2008) and 8,364,400 shares of Common Stock issued to the Shareholders on August
13, 2008 pursuant to the conversion of the Issuers outstanding 1,672,880
shares of Series B Preferred Stock (as such capitalized terms are hereinafter
defined)).
3
This filing is being made
to amend the Schedule 13D previously filed by David R. Topper and his wife
Alexa Topper on August 20, 2007 (the Original Schedule 13D Filing)
solely to amend and restate Items 1, 2(a)-(c), 3, 4, and 5(a)-(b). There have been no other changes to the
information previously reported in the Original Schedule 13D Filing.
Item 1.
Security
and Issuer.
The name of the issuer is
Prospect Medical Holdings, Inc., a Delaware corporation (the Issuer),
which has its principal executive offices at 10780 Santa Monica Blvd., Suite 400,
Los Angeles, CA 90025. The class of equity securities to which this statement
relates is the common stock, par value $0.01 per share (the Common Stock), of
the Issuer.
Item 2.
Identity
and Background.
(a)-(c)
This statement on
Schedule 13D (the Statement) is filed by David R. Topper and his wife Alexa
Topper, as the trustees and settlors under the David & Alexa Topper
Family Trust, U/D/T September 29, 1997 (the Trust). Mr. Toppers
and Ms. Toppers business address is c/o Alta Hospitals System, LLC, 10780
Santa Monica Blvd., Suite 400, Los Angeles, CA 90025. Mr. Topper is
the President of such company. Ms. Topper is not employed.
Item 3.
Source
and Amount of Funds or Other Consideration.
On August 8, 2007,
the Issuer acquired Alta Healthcare System, Inc., a Delaware corporation
(Alta), pursuant to an Agreement and Plan of Reorganization (the Merger
Agreement) by and among the Trust and Samuel S. Lee, the sole shareholders of
Alta (collectively, the Shareholders), the Issuer, Prospect Hospitals System,
LLC, a California limited liability company and a direct wholly-owned
subsidiary of the Issuer (Sub), and Alta, providing for the merger of Alta
with and into Sub, with Sub as the surviving entity (the Survivor) and
continuing as a wholly-owned subsidiary of the Issuer (such acquisition is
referred to herein as the Merger). As a result of the Merger, the Trust
received 943,568 shares of Common Stock, 836,440 shares of Series B
Preferred Stock, par value .01 per share (the Series B Preferred Stock),
and $25.6 million in cash. A copy of the Merger Agreement has previously been
filed as Exhibit 1 to this Statement and is incorporated herein by
reference.
The terms of the Series B
Preferred Stock provided that it was not convertible into Common Stock upon
issuance, but would become convertible by its terms upon receipt of stockholder
approval. Such approval was obtained at the Issuers annual meeting of
stockholders held on August 13, 2008. As a result, upon receipt of such
approval each share of Series B Preferred Stock automatically became
convertible into five shares of Common Stock at a conversion price of $5.00 per
share of Common Stock. Thus, the Trusts 836,440 shares of Series B
Preferred Stock became convertible into a total of 4,182,200 shares of Common
Stock. The Trust converted all of its Series B Preferred Stock into Common
Stock following the annual meeting and after approval by the American Stock
Exchange of the listing of the underlying shares of Common Stock. As a result,
the Trust now holds a total of 5,125,768 shares of Common Stock and no Series B
Preferred Stock. In addition, the Trust no longer has certain rights associated
with being a holder of the Series B Preferred Stock, including the right
to elect, with all holders of Series B Preferred Stock as a class, two
directors to the Issuers Board of Directors and the right to receive any
accrued and unpaid dividends.
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Item 4.
Purpose
of Transaction.
As described under Item 3
above, as a result of the Merger, the Trust received 943,568 shares of Common
Stock, 836,440 shares of the Series B Preferred Stock and $25.6 million in
cash, and such Series B Preferred Stock has since been converted into
4,182,200 shares of Common Stock.
The Merger Agreement
includes certain indemnification provisions pursuant to which the Shareholders
have agreed, severally (not jointly), to indemnify the Issuer and certain of
its affiliates against certain losses and expenses (i) resulting from
breaches of representations and warranties and covenants of the Shareholders
and Alta and its subsidiaries under the Merger Agreement and (ii) relating
to certain pending litigation against Alta, Mr. Lee and Mr. Topper
(the Special Litigation). Pursuant to the Merger Agreement, (i) the
Issuer has limited periods of time in which to make claims, depending on the
event that gives rise to the indemnification obligation; and (ii) subject
to certain exceptions (including those provisions relating to the Special
Litigation), the Shareholders are obligated to pay only those losses which
exceed $800,000 in the aggregate, and the Shareholders have a maximum aggregate
liability of (A) 10% of the total consideration received by the
Shareholders (the Merger Consideration) with respect to claims asserted on or
before January 2, 2008 and (B) 5% of the Merger Consideration with
respect to claims asserted after January 2, 2008.
Under the Merger
Agreement, the Shareholders may satisfy their indemnification obligation by
payment half in cash and half by returning shares of the Common Stock. With
respect to any shares of the Common Stock returned for cancellation, such
shares will be assigned a value of $5.00 per share.
The Merger Agreement also
includes certain non-competition provisions that are binding on Mr. Topper.
At the closing of the
Merger (the Closing), the Trust and Mr. Lee entered into a Registration
Rights Agreement with the Issuer, dated as of August 8, 2007 (the
Registration Rights Agreement), which contains provisions that, among other
things, (i) restrict transfers of a certain percentage of shares of the
Common Stock for a period of three years; and (ii) obligate the Issuer to
prepare and file a registration statement to register such shares under the
U.S. securities laws upon the request of any holder of such shares (as well as
grants such holder so-called piggyback registration rights). A copy of the
Registration Rights Agreement has previously been filed as Exhibit 3 to
this Statement and is incorporated herein by reference. In addition, at the
Closing of the Merger the Survivor entered into an Executive Employment
Agreement, dated as of August 8, 2007 (the Employment Agreement), with Mr. Topper.
The Employment Agreement provides, among other things, that Mr. Topper
will serve as the President of the Survivor for a term of five years, on the
terms and subject to the conditions set forth therein. A copy of the Employment
Agreement has previously been filed as Exhibit 4 to this Statement and is
incorporated herein by reference.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in the acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer, (i) the Trust, Mr. Topper
or Ms. Topper may in the future seek to acquire additional shares of the
Common Stock; (ii) Mr. Toppers Employment Agreement provides that he
shall be eligible to participate in any executive equity incentive plan adopted
by the Board of Directors of the Issuer; and (iii) subject to the terms of
the Registration Rights Agreement, the Trust may in the future seek to dispose
of some or all of its shares of the Common Stock. Any such acquisition or
disposition may be effected in privately negotiated transactions, in the open
market, in block
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transactions, pursuant to underwritten transactions (in the case of
dispositions) or otherwise. There can be no assurance that any such acquisition
or disposition of shares of the Common Stock would occur or as to the timing or
method of any such acquisition or disposition on the open market, through
private transactions or otherwise in accordance with applicable law.
With respect to current plans
or proposals of Mr. Topper or Ms. Topper which relate to or would
result in an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its subsidiaries,
neither Mr. Topper nor Ms. Topper currently has any such plans or
proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in a sale or transfer of a material amount of assets of the Issuer
or any of its subsidiaries, neither Mr. Topper nor Ms. Topper
currently has any such plans or proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board, neither Mr. Topper
nor Ms. Topper currently has any such plans or proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in any material change in the present capitalization or dividend
policy of the Issuer, neither Mr. Topper nor Ms. Topper currently has
any such plans or proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in any other material change in the Issuers business or corporate
structure, neither Mr. Topper nor Ms. Topper currently has any such
plans or proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in changes in the Issuers charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the Issuer by any person, neither Mr. Topper nor Ms. Topper
currently has any such plans or proposals, except as discussed herein or as
contemplated by the Merger Agreement.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in causing a class of securities of the Issuer to be delisted from
a national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association,
neither Mr. Topper nor Ms. Topper currently has any such plans or
proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in a class of equity securities of the Issuer becoming eligible
for termination of registration pursuant to section 12(g)(4) of the
Securities Exchange Act of 1934, as amended, neither Mr. Topper nor Ms. Topper
currently has any such plans or proposals.
With respect to current
plans or proposals of Mr. Topper or Ms. Topper which relate to or
would result in any action similar to any of those enumerated above, neither Mr. Topper
nor Ms. Topper currently has any such plans or proposals, except as set
forth herein or as may be contemplated by the Registration Rights Agreement or
the Merger Agreement.
6
Mr. Topper and Ms. Topper
are continually reviewing and evaluating their respective positions with
respect to the Issuer and may at any time reconsider and change their positions
and formulate plans or proposals with respect to any such matters, but neither has
any current plans to do so.
The foregoing is
qualified in its entirety by reference to the exhibits filed with and
incorporated by reference in this Statement, including the Merger Agreement and
the Registration Rights Agreement.
Item 5.
Interest
in Securities of the Issuer.
(a)-(b)
The
aggregate number of shares of Common Stock deemed to be beneficially owned by
each of Mr. Topper and Ms. Topper for the purposes of this Statement
is 5,125,768, representing 25.4% of the outstanding shares of Common Stock of
the Issuer (based on
20,146,967
shares of Common Stock outstanding (comprised of the aggregate of 11,782,567
shares of Common Stock outstanding as of July 8, 2008 (as reported by the Issuer in its
2008 Proxy Statement filed July 10, 2008) and 8,364,400 shares of Common
Stock issued to the Shareholders on August 13, 2008 pursuant to the
conversion of the Issuers outstanding 1,672,880 shares of Series B
Preferred Stock). Each of Mr. Topper
and Ms. Topper has shared voting and dispositive power as to all of such
shares.
7
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
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August 15, 2008
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Date
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/s/ David R. Topper
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Signature
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David R. Topper
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Name/Title
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ATTENTION
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Intentional misstatements or
omissions of fact constitute Federal Criminal Violations (See 18 U.S.C.
1001).
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Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
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August 15, 2008
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Date
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/s/ Alexa Topper
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Signature
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Alexa Topper
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Name/Title
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ATTENTION
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Intentional misstatements or
omissions of fact constitute Federal Criminal Violations (See 18 U.S.C.
1001).
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