Physicians Resource Group, a Dallas-based physician practice management company, filed for Chapter 11 bankruptcy protection last week.
PRG failed to pay interest due on its debt on June 1, 1999, and Dec. 1, 1999, causing the debt to be in default.
The schedules PRG filed in U.S. Bankruptcy Court in Dallas reflect assets and liabilities of about $135 million.
PRG owes its largest creditor, Resurgence Asset Management, more than $90 million, according to PRG attorney Hugh Ray of Andrews & Kurth in Houston.
PRG said it expects to complete a debt restructuring agreement with Resurgence, based in White Plains, N.Y., but did not say when.
PRG has not filed any financial reports with the Securities and Exchange Commission since the quarter ended June 30, 1999. At deadline company representatives had not returned calls regarding revenue for the last fiscal year.
The company began operations in 1995 and at its peak in 1997 was affiliated with 127 eye-care practices at 342 locations in 22 states. After growing rapidly in 1996 and 1997, PRG faced substantial integration challenges, particularly related to transactions between individual practices and corporate accounting.
By the end of 1998, 61 affiliated practices either had stopped sending management fees or information, or had filed lawsuits against PRG alleging claims including breach of contract, breach of fiduciary duty, fraud and negligent misrepresentation.
Strapped for cash, PRG forged a restructuring plan in March 1998 that focused on lowering service fees and reducing the level of services to practices. The plan also emphasized that PRG would sell practice assets back to physicians and unload its stake in some of its surgery centers.
In 1999, the company sold the assets of 45 wholly owned subsidiaries and stakes in about 22 ambulatory surgery centers for $77 million in cash and debt forgiveness. PRG paid $9.5 million in bank debt and $3.8 million owed to Resurgence for a short-term loan. The company intends to seek the bankruptcy court's approval to continue to sell assets to physicians.