New York Health Care Inc - Current report filing (8-K)
July 03 2008 - 3:15PM
Edgar (US Regulatory)
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)
July 3, 2008
NEW
YORK HEALTH CARE,
INC.
|
(Exact
Name of Registrant as
Specified in Its Charter)
|
New
York
|
1-12451
|
11-2636089
|
(State
or Other Jurisdiction
|
(Commission
|
(IRS
Employer
|
of
Incorporation
|
File
Number)
|
Identification
No.)
|
1850
McDonald Avenue, Brooklyn, New York
|
11223
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(212)
679-7778
|
(Registrant's
Telephone Number, Including Area
Code)
|
|
(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 (see General Instruction A.2. below):
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
|
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
|
INFORMATION
TO BE INCLUDED IN THE REPORT
Section
8 - Other Events
Item
8.01 Other Events
As
previously reported in the Company’s Form 8-K filed on March 10, 2006 with the
Securities Exchange Commission (“SEC”), on March 6, 2006, the Company entered
into a settlement agreement (“Emerald Settlement Agreement”) with Emerald Asset
Management, Inc. (“Emerald”) and Yitz Grossman (“Grossman”) related to the
resolution of disputes under a consulting agreement dated June 1, 2001 (the
“Emerald Consulting Agreement”) between the Company and Emerald. Under the
Emerald Consulting Agreement, Emerald was entitled to $250,000 per year through
2011, additional payments equal to bonuses paid to the Chief Executive Officer
of the Company and reimbursement of expenses. In November 2003, the Company
terminated the Emerald Consulting Agreement in response to the indictment of
one
of the officers and directors of its subsidiary, The BioBalance Corporation
(“BioBalance”) and Grossman, as previously reported in the Company’s Form 10-K
for the year ended December 31, 2003.
Pursuant
to the Emerald Settlement Agreement and in order avoid the cost and uncertainty
of litigation, the Company agreed to (i) the immediate payment of $700,000
to
Emerald, (ii) payment of $22,000 per month for eighteen months beginning January
1, 2006, (iii) the issuance of 400,000 shares of Common Stock, (iv) options
to
purchase 1,100,000 shares of Common Stock at $0.78 per share
until
March 1, 2010 and (v) health insurance for Grossman and his family for the
eighteen month period ending June 30, 2008 amounting to approximately $35,100.
In return, Emerald and Grossman executed a general release of all claims they
may have against the Company. The Company granted Emerald a one-time demand
registration right and unlimited piggy back registrant rights for the
unregistered Common Stock to be issued and underlying the options..
As
previously reported in the Company’s Form 8-K filed with the SEC on August 21,
2006, on that date the Company unilaterally rescinded the Emerald Settlement
Agreement. This rescission was done without the consent of Emerald and Grossman.
The related liability was recorded on the books of the Company at December
31,
2007 in the amount of approximately $1.9 million.
As
reported in the Company’s Form-10-Q for the quarter ended March 31, 2008, on
April 24, 2008, the Company was contacted by counsel for Emerald and Grossman,
demanding that the Company perform its obligations under the Emerald Settlement
Agreement. The Company subsequently commenced discussions with Grossman with
a
view to settling the dispute.
As
of the date of the filing of this Form 8-K, the parties have tentatively agreed
in principle to the following settlement terms: termination of the Emerald
Settlement Agreement and a release by each party of prior claims against the
other; an immediate cash payment by the Company to Grossman of $650,000; and
a
33-1/3% interest in a newly-formed limited liability company into which
BioBalance will contribute its assets, with the Company to retain the remaining
66-2/3% interest in BioBalance. Contemporaneously with the settlement, Grossman
would enter into a one-year consulting agreement with BioBalance under which
Grossman would be paid a base consulting fee of $180,000 and be reimbursed
for
approved expenses, with the opportunity to earn up to an additional $180,000
contingent on an increase in the valuation of BioBalance, based on a formula
currently being negotiated. The Company would agree to advance $2 million to
BioBalance to fund product development and administrative expenses during the
one-year consulting term. As reported in the Company’s Form 10-K for the year
ended December 31, 2007, the remaining net carrying value of the intellectual
property of BioBalance after recording impairment losses was
$628,056.
The
foregoing proposed settlement terms are not binding on the Company, Emerald
and
Grossman, who have not yet entered into definitive agreements reflecting these
terms, and there can be no assurance that such definitive agreements will be
entered into, or that subsequent negotiations will not result in modified
terms.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, Registrant has
duly
caused this report to be signed on its behalf by the undersigned thereunto
duly
authorized.
|
|
|
|
NEW
YORK HEALTH CARE, INC.
|
|
(Registrant)
|
|
|
|
Date:
July 3, 2008
|
By:
|
/s/
Murry Englard
|
|
Murry Englard, Chief Executive Officer
|
|
|
New York Health Care (CE) (USOTC:BBAL)
Historical Stock Chart
From Oct 2024 to Nov 2024
New York Health Care (CE) (USOTC:BBAL)
Historical Stock Chart
From Nov 2023 to Nov 2024