UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): November 28, 2023
U.S. NeuroSurgical Holdings, Inc.
(Exact name of registrant as specified in its charter)

Delaware
000-26575
52-1842411
(State of other jurisdiction of incorporation or organization)
(Commission File Number)
(I.R.S. Employer Identification No.)

2400 Research Blvd, Suite 325
Rockville, Maryland
20850
(Address of principal executive offices)
 (Zip Code)

Registrant's telephone number, including area code:
(301) 208-8998

Not Applicable
(Former name, former address and former fiscal year, 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):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: N/A

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company          ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01
Entry into a Material Definitive Agreement.
 
U.S. NeuroSurgical Holdings, Inc. (“USNU” or the “Company”), entered into a Share Exchange Agreement dated as of November 27, 2023 (the “Share Exchange Agreement”) with the holders of minority interests in U.S. NeuroSurgical, Inc. (“USN”), which resulted in making USN a wholly-owned subsidiary of the Company.  Prior to the exchange, the Company owned 85% of USN.  Under the terms of the Share Exchange Agreement, the former minority holders of USN (the “Minority Holders”) received an aggregate of 1,392,739 newly-issued shares of USNU common stock, representing 15% of the Company’s outstanding common stock after the giving effect to the issuance.

As a part of its agreement to acquire Elite Health Plan, Inc., a California corporation (“Elite Health”) in October 2021, the Company agreed with the former Elite Health shareholders that if there is no trading market for the shares of USN after six months from the closing of the transaction, such holders may request that the Company take steps that would give such holders access to the public trading market, which could be accomplished at the Company’s election through an exchange of such holders’ shares for USNU shares.  The Minority Holders have made such request, and the Company has determined that it is in its best interests to provide the Minority Holders with access to the public markets though an exchange of shares as provided under the Share Exchange Agreement.  As a result of the transaction, there are outstanding as of November 27, 2023, 9,284,924 shares of USNU common stock.

The above description of the Share Exchange Agreement does not purport to be a complete description and is qualified in its entirety by reference to the full text of the Share Exchange Agreement, which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.

Item 8.01
Other Events.

As previously disclosed and referred to in Item 1.01 of this Form 8-K, Elite Health was acquired by USN, the Company’s operating subsidiary, in October 2021, in exchange for an equity interest in USN that constituted 15% of USN after the transaction.  (Pursuant to the transaction described in Item 1.01, Elite Health is now wholly-owned by the Company through USN.)  Elite Health was formed in 2017 with the purpose of establishing a managed care organization that will operate as a Medicare Advantage plan for seniors.  Medicare Advantage plans are regulated and reimbursed by the federal government and licensed by the state or states within which they operate.  Our plan is for Elite Health to initially operate in Neveda and then in the California counties of San Bernadino, Los Angeles, and Orange.  Each of these states and markets has a growing number of Medicare eligible seniors.  In time, our plan is for Elite Health to identify and operate in other suitable markets beyond Nevada and California.  Because of the collective experience of its founders and affiliates as physicians, software executives, and health plan administrators, we believe that Elite Health will be positioned to bring a comprehensive and cost-effective solution to eligible seniors in these markets.

Elite Health will need to apply for a license in each state that it intends to operate.  We have commenced the process for establishing a Medicare Advantage plan in Nevada, which could be the first state in which we operate due to the relatively long time frame necessary to complete the licensing process in California.  With respect to California, we are in the process of applying for a Knox Keene license which would enable Elite Health to operate a Medicare Advantage plan in that state.  However, there can be no assurance that the Company and Elite Health will be able to secure a license and or establish operations in Neveda, California or other states.  While the licensing applications are in process, Elite Health has taken preliminary steps toward identifying a network of providers who are well-versed in the healthcare needs of seniors in the communities in which they practice.  Elite Health founders and affiliates also have considerable experience with healthcare record based software and the proposed will endeavor to utilize the latest advances in information systems, including AI and data analytics, in its processes to enhance each patient experience and control medical costs.

The Company and Elite Health understand that the keys to success with a managed care organization are delivering comprehensive patient care and containing costs.  In addition to developing a plan to obtain and maintain necessary approvals and licenses, gaining access to a competent network of providers and enrolling a critical level of subscribers, it will be necessary for the plan to provide high quality patient care efficiently and cost effectively.  There can be no assurance that the Company and Elite Health will be effective in doing so.

Until its first plan is licensed and established, Elite Health will have no revenues.  Therefore, Elite Health will be required to raise capital to support licensing activity for its proposed Medicare Advantage plans and continue to establish its network of providers for its plans.  There can be no assurance that sources of such capital will be available to the Company or, if available, will be able to be obtained under acceptable terms.

Item 9.01.
Financial Statements and Exhibits.
 
(d)  Exhibits.
 
Exhibit
Number
 
Description of Exhibit
 
 
 
 
Share Exchange Agreement, dated as of November 27, 2023, between U.S. NeuroSurgical Holdings, Inc. and certain shareholders of U.S. NeuroSurgical, Inc.
     
     
2
SIGNATURES
 
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.
 
Date: November 28, 2023
 
 
 
 
U.S. NeuroSurgical Holdings, Inc.
 
 
 
 
By:
/s/ Alan Gold
 
Name:
Alan Gold
 
Title:
President

3
Exhibit 2.1

SHARE EXCHANGE AGREEMENT

This Share Exchange Agreement (this "Agreement"), dated as of November __, 2023, is entered into between certain shareholders of U.S. NeuroSurgical, Inc., a Delaware corporation ("USN") as listed on Schedule 1 hereto (the "Shareholders") and U.S. Neurosurgical Holdings, Inc. ("USNU").  The Shareholders and USNU are sometimes referred to herein as the "Parties."  Capitalized terms used in this Agreement have the meanings given to such terms herein.

RECITALS

WHEREAS, USNU and the Shareholders have agreed to a share-for-share exchange  pursuant to which (i) all of the shares of capital stock of the USN owned by the Shareholders, constituting 300 shares of no par value Common Stock (the "USN Shares"), would be exchanged for (ii) 1,392,739  shares of newly issued Common Stock, par value $0.01per share, of USNU (the "USNU Shares").  The USNU Shares issuable to the Shareholders (the "New USNU Shares") will represent fifteen percent (15%) of the total issued and outstanding shares of common stock of USNU as of and immediately after the issuance of the New USNU Shares; and

WHEREAS, the Shareholders and the Board of Directors of USNU have independently determined that it is in the best interests of all of the Parties to execute and effectuate this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.          Exchange of USN Shares for New USNU Shares. At the Closing, each of the Shareholders shall sell, transfer, convey, assign and deliver to USNU the USN Shares set forth on Schedule 1 hereto, free and clear of any mortgage, pledge, lien, charge, security interest, claim, community property interest, option, equitable interest, restriction of any kind (including any restriction on use, voting, transfer, receipt of income, or exercise of any other ownership attribute), or other encumbrance (each, an "Encumbrance"), in exchange for the New USNU Shares, free and clear of all Encumbrances.

2.          Closing. The closing of the transactions contemplated by this Agreement (the "Closing") shall take place on the business day following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated under this Agreement or such other date and time as the Parties may mutually determine (the "Closing Date") in the manner as the Parties may mutually agree upon.  The consummation of the transactions contemplated by this Agreement shall be deemed to occur at 12:01 a.m. New York time on the Closing Date.

3.          Shareholder Deliverables. At the Closing, the Shareholders shall deliver to USNU the following:

(a)          Share certificates or other instruments evidencing the USN Shares, free and clear of all Encumbrances, duly endorsed in blank or accompanied by stock powers or other instruments of transfer duly executed in blank, with all required share transfer tax stamps affixed thereto.

(b)          Such certificates and documents as USNU shall reasonably request relating to the Shareholders ownership of, and right to transfer, the USN Shares consistent with the terms of this Agreement.

4.          USNU Deliverables. At the Closing, USNU shall deliver the following to the Shareholders:

(a)          Share certificates evidencing the New USNU Shares, or evidence that such shares have been issued in the name of Shareholders, free and clear of all Encumbrances, or other appropriate evidence of the ownership of the New USNU Shares.

(b)          Such certificates and documents as the Shareholders shall reasonably request relating to USNU right to issue the New USNU Shares consistent with the terms of this Agreement.

5.          Investment Intent.

(a)          The Shareholders acknowledge and agree that they are acquiring the New USNU Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the New USNU Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act of 1933, as amended (the "Securities Act") directly or indirectly unless the New USNU Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the selling Shareholder has furnished to USNU an opinion of counsel to that effect or such other written opinion as may be reasonably required by USNU.

(b)          The Shareholders acknowledge and agree that the certificates representing the New USNU Shares shall bear a restrictive legend, substantially in the following form:

“THE SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.”

(c)          The Shareholders acknowledge and agree that:

(i)          USNU will refuse to register any transfer of the New USNU Shares not made pursuant to an effective registration statement under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act and in accordance with applicable state and provincial securities laws, and

(ii)          USNU may make a notation on its records and/or give instructions to its registrar and transfer agent in order to implement the restrictions on transfer set forth and described herein.

2
6.          Miscellaneous.

(a)          Expenses.  All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

(b)          Notices.  All notices, claims, demands, and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid, if sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this subparagraph:

 
If to the Shareholders:
Dr. Prasad Jeereddi
840 Towne Center Drive
Pomona CA 91767
Email: jprasad@earthlink.net
     
   
Chenjie Bao Reeher
4902 Corkwood Lane
Irving CA 92612
Email:  baobao@pssphysians.com
     
 
If to USNU:
U.S. NeuroSurgical Holdings, Inc.
2400 Research Blvd, Suite 325
Rockville, Maryland 20850
Attention: Chief Executive Officer
Email: agold@ghsusn.com

(c)          Governing Law; Submission to Jurisdiction. All matters arising out of or relating to this Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule.

(d)          Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

 
SHAREHOLDERS
  
     
 
/s/ Prasad Jeereddi
PRASAD JEEREDDI
  
     
 
/s/ Chenjie Bao Reeher
CHENJIE BAO REEHER
  

 
U.S. NEUROSURGICAL HOLDINGS, INC.
  
 
By: /s/ Alan Gold
  
 
       Alan Gold Chief
       Executive Officer
  

4
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Document and Entity Information
Nov. 28, 2023
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date Nov. 28, 2023
Entity File Number 000-26575
Entity Registrant Name U.S. NeuroSurgical Holdings, Inc.
Entity Central Index Key 0001089815
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 52-1842411
Entity Address, Address Line One 2400 Research Blvd,
Entity Address, Address Line Two Suite 325
Entity Address, City or Town Rockville
Entity Address, State or Province MD
Entity Address, Postal Zip Code 20850
City Area Code 301
Local Phone Number 208-8998
Entity Emerging Growth Company false
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
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