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As filed with the Securities and Exchange Commission on March 1, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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INFOCURE CORPORATION
(Exact Name of Registrant as Specified in its Charter)
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Delaware (State or 7372 (Primary 58-2271614 (I.R.S.
other Jurisdiction Standard Industrial Employer
of Incorporation or Classification Code Identification
Organization) Number) Number)
1765 The Exchange, Suite 450
Atlanta, Georgia 30339
(770) 221-9990
(Address, Including Zip Code and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
LANCE B. CORNELL
Senior Vice President--Finance
Chief Financial Officer
1765 The Exchange, Suite 450
Atlanta, Georgia 30339
Telephone: (770) 221-9990
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
Copies to:
Oby T. Brewer III, Esq.
Lauren Z. Burnham, Esq.
MORRIS, MANNING & MARTIN, L.L.P.
1600 Atlanta Financial Center
3343 Peachtree Road, N.E
Atlanta, Georgia 30326
Telephone: (404) 233-7000
Facsimile: (404) 365-9532
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement until March
27, 2000 or until such earlier time that all of the shares registered
hereunder have been sold.
If the only securities being registered in this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Title of Each Class of Amount to Proposed Maximum Amount of
Securities Registered be Registered (1) Offering Price (2) Registration Fee
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<S> <C> <C> <C>
Common Stock, $.001 par
value................... 3,954,078 Shares $114,174,000.00 $31,741
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</TABLE>
(1) The shares of common stock set forth in the Calculation of Registration
Fee Table, and which may be offered pursuant to this Registration
Statement, includes, pursuant to Rule 416 of the Securities Act of 1933,
as amended, such additional number of shares of the Registrant's common
stock that may become issuable as a result of any stock splits, stock
dividends or similar event.
(2) Estimated solely for the purpose of computing the amount of the
registration fee, based on the average of the high and low prices for the
Company's common stock as reported on the Nasdaq Stock Market on February
25, 1999 in accordance with Rule 457 under the Securities Act of 1933.
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act or until the Registration Statement shall become effective
on such date as the Securities and Exchange Commission, acting pursuant to
Section 8(a), may determine.
<PAGE>
SUBJECT TO COMPLETION, DATED , 1999
3,954,078 Shares
InfoCure Corporation
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Common Stock
These shares of common stock are being offered by the Selling Stockholders
identified in this prospectus. We issued the shares to the Selling Stockholders
in connection with financing transactions and acquisition. See "Issuance of
Common Stock to Selling Stockholders." The Selling Stockholders may sell these
shares from time to time on the over-the-counter market in regular brokerage
transactions, in transactions directly with market makers or in certain
privately negotiated transactions. For additional information on the methods of
sale, you should refer to the section entitled "Plan of Distribution." We will
not receive any portion of the proceeds from the sale of these shares. Each of
the Selling Stockholders may be deemed to an be "Underwriter," as that term is
defined in the Securities Act of 1933, as amended.
InfoCure Corporation's common stock is quoted on the Nasdaq Stock Market
under the symbol "INCX." On February 24, 1999, the last sale price of the
common stock on the Nasdaq Stock Market was $29.75 per share.
Investing in the common stock involves certain risks. See "Risk Factors"
beginning on page 3.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this prospectus is , 1999
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TABLE OF CONTENTS
<TABLE>
<S> <C>
Incorporation of Certain Documents By Reference............................. i
Where You Can Find More Information......................................... ii
InfoCure Summary............................................................ 1
Risk Factors................................................................ 3
Use of Proceeds............................................................. 11
InfoCure Background......................................................... 11
Issuance of Common Stock to Selling Stockholders............................ 12
Plan of Distribution........................................................ 12
Selling Stockholders........................................................ 14
Legal Matters............................................................... 18
Experts..................................................................... 18
</TABLE>
We have not authorized any dealer, salesperson or other person to give any
information or represent anything not contained in this prospectus. You should
not rely on any unauthorized information. This prospectus does not offer to
sell or buy any shares in any jurisdiction in which it is unlawful. The
information in this prospectus is current as of the date on the cover.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This prospectus is part of a registration statement on Form S-3 that we
filed with the Securities and Exchange Commission (the "Commission"). This
prospectus does not contain all the information in that registration statement.
For further information with respect to InfoCure and the securities offered by
this prospectus, you should review the registration statement. You can obtain
the registration statement from the Commission and the Nasdaq Stock Market at
the public reference facilities we refer to below.
The Commission allows us to "incorporate by reference" information into this
prospectus. This means that we can disclose important information to you by
referring you to another document filed separately with the Commission. The
information incorporated by reference is deemed to be part of this prospectus,
except for any information superseded by information contained directly in this
prospectus. This prospectus incorporates by reference the documents set forth
below that InfoCure has previously filed with the Commission. These documents
contain important information about InfoCure and its financial condition.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained
herein, or in any other subsequently filed document that is also incorporated
or deemed to be incorporated by reference herein, modifies or supersedes the
earlier statement. Any statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this prospectus.
The following documents are incorporated by reference into this prospectus:
<TABLE>
<CAPTION>
Filing Period
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<S> <C>
Registration Statement on Form SB-2 (with respect
to the description of the common stock and the
audited financial statements contained therein)
................................................. Effective July 10, 1997
Definitive Proxy Statement (with respect to the
description of the Convertible, Redeemable
Preferred Stock, Series A contained therein)..... Filed on April 30, 1998
Annual Report on Form 10-KSB...................... Year Ended December 31, 1998
Current Report on Form 8-K (relating to the RADMAN
Acquisition)..................................... Dated January 6, 1999
Current Report on Form 8-K (relating to the
OMSystems Merger)................................ Dated February 9, 1999
</TABLE>
All documents filed by InfoCure pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 subsequent to the date of this
prospectus will be deemed to be incorporated by reference into this prospectus
and to be a part hereof from the date of filing of such documents.
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On request, InfoCure will provide at no cost to each person, including any
beneficial owner, who receives a copy of this prospectus, a copy of any or all
of the documents incorporated in this prospectus by reference. InfoCure will
not provide exhibits to any of such documents, however, unless such exhibits
are specifically incorporated by reference into this prospectus. Written or
telephonic requests for such copies should be addressed to InfoCure's principal
executive offices, attention: Lance B. Cornell, Senior Vice President--Finance
and Chief Financial Officer, 1765 The Exchange, Suite 450, Atlanta, Georgia
30339, telephone number (770) 221-9990.
WHERE YOU CAN FIND MORE INFORMATION
InfoCure files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). InfoCure has filed with
the Commission a registration statement on Form S-3 under the Securities Act of
1933, as amended (the "Securities Act") to register the offering of the shares
of common stock offered hereby. This prospectus, which constitutes a part of
the registration statement, does not contain all of the information set forth
in the registration statement. Prospective investors may read and copy the
registration statement and its exhibits and schedules without charge at the
Public Reference Room maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Prospective investors may obtain information on the
operation of the Public Reference Room by calling the Commission at
1-800-SEC-0330. In addition, InfoCure is required to file electronic versions
of these documents with the Commission through the Commissions' Electronic Data
Gathering, Analysis, and Retrieval (EDGAR) system. The Commission maintains a
World Wide Web site at http://www.sec.gov that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission.
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InfoCure Summary
This summary highlights information contained elsewhere in this prospectus.
It is not complete and may not contain all of the information that you should
consider before investing in our common stock. We encourage you to read the
entire prospectus carefully, including the section entitled "Risk Factors." In
this prospectus, "InfoCure," "we," "our," and "us" refer to InfoCure
Corporation and its consolidated subsidiaries.
Our Business
We are a leading national provider of healthcare practice management
software products and services. Our wide range of practice management software
automates the administrative, financial and clinical information management
functions for doctors, dentists and other healthcare practitioners. We also
provide our customers with ongoing maintenance and support, training and
electronic data interchange, or "EDI," services. Our goal is to become the
leading provider of practice management systems to targeted healthcare practice
specialties. These specialties include anesthesiology, emergency medicine, oral
and maxillofacial surgery, orthodontics, pathology, podiatry and radiology. We
believe that our ability to offer state-of-the-art software products that serve
the specific needs of these healthcare practice specialties and our ability to
sell additional products and services to our existing customer base will help
us achieve this goal. As of February 24, 1999, 11,650 customer sites had
installed InfoCure systems. These sites represent approximately 66,000
healthcare providers, and we have systems installed in all 50 states.
Our business model is designed to grow the sales of software systems and to
increase recurring revenue from ongoing maintenance and support and EDI
services. As a result of this model, approximately 50% of total revenue is
currently recurring in nature. We focus on growing our installed customer base
through new system sales and acquisitions. Since October 1997, we have acquired
eleven practice management systems vendors.
Our Products and Services
Our systems provide significant benefits that enable customers to manage
their practices more efficiently. Our customers are able to choose from a menu
of features and functions most essential to their practices, primarily in the
following areas:
. Administrative management;
. Financial management; and
. Clinical information management.
This approach of providing a menu of features and functions enables
healthcare practitioners to configure products that serve their specific needs.
In addition, we have significant opportunities to sell additional products and
services to our installed customer base.
We have recently commenced a program emphasizing and broadening the EDI
service capabilities we provide to our customers. EDI allows practitioners to
verify insurance eligibility, receive appropriate referrals, submit claims and
receive reimbursement electronically. We believe that greater utilization of
EDI and the resulting increase in the number of "paperless" transactions will
improve the efficiency of healthcare providers. We believe this presents us
with the opportunity to generate significant additional recurring revenue. In
addition to EDI services, we have recently begun to offer InfoMine decision
support software. Using InfoMine, practitioners can quickly analyze the
performance of their practices, including the profitability of contractual
relationships with third-party payors.
Strategies
Our objective is to become the leading provider of advanced, specialty-
specific practice management systems within targeted healthcare specialties.
Our principal strategies to achieve this objective include:
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. Continue to take advantage of niche market opportunities;
. Cross-sell our services and pursue opportunities with existing customers;
. Expand the features of products and services offered;
. Establish a national marketing identity; and
. Take advantage of economies of scale.
Our principal offices are located at 1765 The Exchange, Suite 450, Atlanta,
Georgia 30339, and our telephone number is (770) 221-9990.
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RISK FACTORS
You should carefully consider the following factors and other information in
this prospectus before deciding to purchase shares of our common stock.
We May Face Difficulties Integrating Acquired Businesses
The successful integration of the businesses we acquire is critical to our
future success. Integrating the management and operations of the businesses we
acquire is time consuming, and we cannot guarantee that we will achieve any of
the anticipated synergies and other benefits expected to be realized from the
acquisitions, including those reflected in our unaudited pro forma combined
financial data. We may face difficulties executing our acquisition strategy,
including any one or more of the following:
. difficulty integrating the financial, operational and administrative
functions of acquired businesses;
. difficulty integrating the products of acquired businesses;
. delays in realizing the benefits of our strategies for an acquired
business;
. diversion of management's attention from our existing operations;
. difficulty operating in markets in which we have little prior experience;
or
. inability to retain key employees necessary to continue the operations of
the acquired businesses.
We may incur significant costs associated with acquisitions, principally in
the quarter in which we complete them. We expect such costs to include:
. the direct costs of acquisitions, including fees to financial advisors,
legal counsel and independent auditors;
. the costs of integrating the operations of the businesses we acquire; and
. charges related to the elimination of overlapping operations and products
(including in-process research and development).
Our Products May Not Be Year 2000 Ready
Many installed computer systems and software products are designed to accept
and process year codes with only two digits in their date fields. These systems
and products may not be "Year 2000 ready" because they may not operate properly
when required to distinguish dates beginning in the year 2000 from dates in the
1900s. If our software products are not Year 2000 ready, our customers may make
claims against us which may result in significant costs and uncertainty. We are
taking the following steps to determine the Year 2000 readiness of our
products:
. review products that we will continue to market and support to determine
how they process dates;
. design and complete modifications to fix any date processing issues that
we identify for these products;
. test products to determine that they can process dates on or after
January 1, 2000; and
. deliver these modifications to our customers for installation and use.
We have designed our Year 2000 readiness tests in a way that we believe will
identify most Year 2000 readiness issues. We have concluded tests for
substantially all of our products that we will continue to sell or support. We
have determined that a majority of these products are Year 2000 ready. We
believe that all products that we will continue to sell or support will be Year
2000 ready by July 1999, but we cannot assure you that they will be. We could
experience delays or failures in developing or implementing modifications
necessary to make a product Year 2000 ready. For older products that we no
longer sell or support, we have attempted to notify all known users of these
products that these products generally are not Year 2000 ready and will not be
made Year 2000 ready. We cannot guarantee that we will be able to contact all
such users.
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As part of our effort to make our products Year 2000 ready and to help our
customers to make their systems that use our products Year 2000 ready, we have
offered our customers various alternative forms of products and assistance
including generally available Year 2000 information and diagnostic tools
(through our InfoTour 2000 customer assistance program), software patches,
product upgrades and replacement products. We cannot guarantee that these
tools, patches, upgrades or replacement products will solve all material Year
2000 problems with our products or our customers' systems or that claims will
not be brought against us alleging that we harmed customers by failing to
provide all of the information, tools, patches, upgrades or replacement
products required to solve all material Year 2000 readiness problems with our
products or our customers' systems.
We have substantially completed an assessment of the Year 2000 readiness of
the software and hardware systems that we use in our business. We believe that
almost all of our internal software and hardware systems are Year 2000 ready.
We have contacted several third parties that we do business with to assess
whether the products and systems that they use in their businesses are Year
2000 ready. We intend to complete this assessment by contacting the remainder
of the third parties that we regularly do business with and by developing
strategies that will help us make sure that no material business disruptions
will result from third-party Year 2000 problems. These strategies may include
obtaining assurances that current business partners achieve timely Year 2000
readiness for the products they use in their businesses. If we do not obtain
these assurances we may be required to contract with alternate third parties or
develop a temporary solution.
We May Have Charges Associated with Acquisitions and Other Events
At times, we have terminated the use of software products, personnel and
facilities of businesses that we have acquired. This has resulted in
substantial charges for discontinued products, impairment of goodwill, employee
terminations and termination of leases and other contracts. Our financial
statements for the year ended December 31, 1998 reflect charges for such items
totaling $1.9 million. Additionally, we expensed $9.0 million related to the
purchase of in-process research and development for the HSD acquisition
completed in October 1998. In February 1999, we completed a merger with
OMSystems, Inc. in a transaction accounted for as a pooling of interests. As a
result, our historical financial results will retroactively reflect the effects
of the pooling. For 1998, OMSystems, Inc. reported a net loss of $3.3 million
including a one-time, non-cash charge of $6.4 million for compensatory stock
awards. We may write off similar charges in connection with future
acquisitions. Recently, the Securities and Exchange Commission (the
"Commission") has required companies to reduce the amount of such charges and
to restate previously issued financial statements. If the Commission were to
require us to restate its financial statements, the announcement of such a
restatement could have an adverse effect on the trading price of our common
stock.
In addition, we plan to prepay the outstanding balance on our Line of Credit
which may result in a charge of as much as $5.1 million for the early
extinguishment of this debt by the first quarter of 1999.
In June 1998, the Board of Directors approved restricted stock awards for
35,000 shares to Mr. Fine, 30,000 shares to Mr. Price and 30,000 shares to Mr.
Perlman. The total value of these restricted stock awards was approximately
$1.1 million on the date of grant. The restricted stock awards vest ratably
over a ten-year term but vesting can be accelerated upon the occurrence of
certain events. One-half of the shares subject to the restricted stock awards
vested in the first quarter of 1999 when our common stock traded at $25.00 or
more for 20 consecutive days. The remaining shares will vest immediately at the
time our common stock is traded at $40.00 or more for 20 consecutive days. We
will incur an estimated compensation charge of an estimated $500,000 related to
the restricted stock awards, based on the current market price of our common
stock, in the first quarter of 1999. Because of the accelerated vesting
provisions, it is possible that we will incur an additional charge of an
estimated $550,000, based on the current market price of our common stock, in
the first quarter of 1999. We do not expect to grant additional restricted
stock awards in the future and therefore do not expect to incur compensation
charges relating to restricted stock awards in the future.
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We May Have Difficulties Managing Our Growth
Our growth places a significant strain on our management and operations. Our
future growth will depend, in part, on our ability to implement and expand
financial control systems, train and manage our employee base and provide
support and services to an increasing customer base. Key personnel have
recently joined InfoCure, and none of our officers has had significant
experience in managing a large, public company. Our success is dependent to a
significant degree on our ability to hire, retain and motivate sales, marketing
and technical employees. We believe that there is a shortage of, and
significant competition for, personnel with the advanced technological,
managerial and marketing skills necessary in our business. Our ability to
implement our growth strategy could be adversely affected by an inability to
hire and maintain additional qualified personnel.
We May Face Difficulties Implementing Our Acquisition Strategy
We intend to pursue acquisitions of businesses, product lines and
technologies that are complementary to our business. These acquisitions will
enable us to achieve our objective of becoming the leading provider of
advanced, specialty-specific practice management systems. Our ability to grow
through acquisitions will depend upon:
. the availability of suitable acquisition candidates at acceptable
acquisition prices;
. the availability of capital to complete acquisitions; and
. the market value of our common stock.
We may experience increased competition for acquisition candidates. This
would mean that fewer acquisition opportunities would be available to us and
that acquisition prices could be higher.
Future acquisitions also could have a significant impact on our financial
condition and capital needs, creating substantial fluctuations in our quarterly
and annual results of operations. Furthermore, future acquisitions may require
us to issue additional equity securities, incur additional debt, amortize the
costs of goodwill and intangible assets, and write off in-process research and
development. Additionally, businesses that we acquire could experience problems
that we are not aware of at the time of the acquisitions. Such problems might
include unknown liabilities, Year 2000 problems, software bugs or adverse
litigation and claims. Any one of these risks could have a material adverse
effect on our business. See "--We May Face Difficulties Integrating Acquired
Businesses."
We are a Relatively New Company
We have conducted our operations on a consolidated basis since July 10,
1997. We have only recently implemented company-wide systems and procedures
designed to manage our combined enterprise. We cannot guarantee that we will
ultimately be able to integrate successfully the operations of all of our
acquired businesses. The inability to successfully integrate our acquisitions
and reduce our operating expenses could have a material adverse effect on
future results and could negatively impact our ability to acquire other
businesses or otherwise execute our business strategy. As a result of this
growth through acquisitions, a year-to-year comparison of our historical
financial statements does not accurately reflect future results.
Our Quarterly Operating Results May Vary and in the Past We Have Experienced
Losses
Our operating results may vary significantly from quarter to quarter. In
addition, we have experienced historical losses. Our operating results are
influenced by such factors as:
. the timing of and charges associated with completed acquisitions or other
events;
. changes in customer purchasing patterns;
. competition;
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. the timing of sales;
. the timing of and cost related to new product introductions and upgrades;
. the length of sales cycles;
. the time required to install products; and
. the levels of advertising and promotional expenditures.
Our sales cycle is influenced by such factors as the size of the
transaction, size of the customer, changing business plans of the customer,
pace of the customers' decision-making process and general economic conditions.
Therefore, it is difficult to forecast revenue from system sales. The sales and
installation efforts for our AS/400 products are more expensive and require
more time than for our Windows-based products. Moreover, sales of AS/400
products occur less frequently than sales of our Windows-based products, but
typically result in greater revenue per sale. In addition, we recognize
substantially lower margins on hardware sales relative to software sales.
Fluctuations in sales of hardware relative to sales of software may negatively
affect our operating margins in a particular quarter.
We operate without any significant backlog of product orders. A majority of
the revenue realized in a quarter results from orders received or services
rendered in that quarter. Thus, operating results for any particular quarter
are not necessarily an indication of future results. Uncertainties associated
with the introduction of new products and with general market trends may limit
our ability to forecast accurately short-term results of operations.
Additionally, substantially all of our expenses are relatively fixed, including
costs of personnel, facilities and communications, and are not susceptible to
rapid reduction.
Competition Could Reduce Revenue from Our Products and Services
Currently, the practice management systems industry in the United States is
characterized by a large number of relatively small, regionally-focused
companies and a few national vendors. We believe that the primary competitive
factors in this market are:
. product features;
. ability to customize products by practice specialty;
. customer service, support and satisfaction;
. price;
. ongoing product enhancements; and
. reputation and stability of the vendor.
Our principal competitors include both national and regional practice
management systems vendors. Some of our national competitors have greater
financial, development, technical, marketing and sales resources than we have.
If competition in the practice management systems industry intensifies, we may
be required to lower the prices we charge for our products and services. This
may have a material adverse effect on future results. It is anticipated that
additional competitors are likely to enter the practice management systems
market as it expands.
Our Success Depends On Our Ability to Protect the Confidentiality of Our
Software
We rely on a combination of trade secrets, copyright and trademark laws,
license agreements, nondisclosure and other contractual provisions and
technical measures to protect our proprietary rights. Our software technology
is not patented and existing copyright laws offer only limited practical
protection. In addition, we generally have not entered into confidentiality
agreements with our employees. We cannot guarantee that the legal protections
that we rely on will be adequate to prevent misappropriation of our
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technology. Also, these protections do not prevent independent third-party
development of competitive products or services. We believe that our products,
trademarks and other proprietary rights do not infringe upon the proprietary
rights of third parties. However, we cannot guarantee that third parties will
not assert infringement claims against us in the future or that any such
assertion will not require us to enter into a license agreement or royalty
agreement with the party asserting a claim. Regardless of the outcome of any
such legal proceedings, responding to and defending against any such
infringement claim may require significant management resources and otherwise
have a material adverse effect on future results.
Our Products May Not Be Accepted By Customers
Evolving healthcare industry standards, technological advances in software
and hardware, and changes in customer demands require significant ongoing
expenditures for the development and timely introduction of new products and
enhancements. We cannot guarantee that we will successfully develop new
products or enhancements of existing products that will satisfy the needs of
customers. Further, products or technologies developed by others may render our
products and technologies noncompetitive or obsolete. In either case, our
failure to gain market acceptance of new products and enhancements by both
existing customers and new customers would adversely affect our revenue. For
example, we have only recently begun to emphasize our EDI service capabilities
and we do not know whether this service will be accepted by our customers. In
addition, we have only recently begun to offer InfoMine decision software to
the anesthesiology market. We do not know whether this software will be
accepted by our anesthesiology customers or whether we will be able to offer
the product to other healthcare practice specialties.
We May Have Liability if Our Products are Defective
Our products perform functions for a healthcare provider's financial
records, patient medical records and treatment plans. If our products fail to
provide accurate, confidential and other timely information, including failures
related to the Year 2000, we may incur liability or face other claims. We
cannot guarantee that we will not be subject to such claims in the future or
that contractual limitations on liability will be enforceable. We currently
maintain product liability insurance on all of our products. We cannot
guarantee that such insurance will adequately cover any specific claim asserted
against us or that our insurance carrier will not deny coverage. A successful
claim brought against us in excess of our insurance coverage could have a
material adverse effect on future results. Even unsuccessful claims could
result in substantial cost, divert management's attention from our operations
and decrease or delay market acceptance of our products.
While we test our products, they may contain defects or problems. These
defects or problems could result in the failure of our customers' systems or
the inability of those systems to perform properly. Our contracts with our
customers contain provisions that limit our liability for those types of
defects or problems; however, these provisions may not be enforceable and may
not protect us from liability. While we have general liability insurance that
we believe is adequate, including coverage for errors and omissions, we may not
be able to maintain this insurance on reasonable terms in the future. In
addition, our insurance coverage may not be sufficient to cover large claims
and our insurer could disclaim coverage on claims. If we are liable for an
uninsured or underinsured claim or if our premiums increase significantly, our
financial condition could be adversely affected.
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Our Stock Price is Volatile
The trading price of our common stock has been highly volatile at relatively
low trading volumes since our initial public offering and we expect significant
fluctuations to continue. These fluctuations are driven by factors including:
. quarterly variations in operating results;
. announcements of acquisitions, technological innovations or new product
releases by us or our competitors; and
. changes in prices of our products or of competitors' products.
Statements made by industry analysts relating to our competitors have
resulted in an immediate adverse effect on the market price of our common stock
in the past and could have a similar result in the future. Statements by
industry analysts regarding our business or markets could contribute to
volatility in the market price of our common stock. In addition, the stock
market has from time to time experienced extreme price and volume fluctuations
which have particularly affected the market price for the securities of many
healthcare information systems companies. These broad market fluctuations may
adversely affect the market price of our common stock.
We May Need Acquisition Financing in the Future
We intend to use proceeds from this offering to repay indebtedness,
including indebtedness incurred to finance prior acquisitions. We expect to
finance future acquisitions, if any, through cash from operations, our
commercial line of credit or other indebtedness, issuances of common stock or
other securities, or any combination of these sources. We cannot guarantee that
capital will be available on terms acceptable to us, or at all.
Our Success Depends on Our Key Executives
Our business depends on the continued efforts of our executive officers and
senior managers. Our strategy has been to retain the most talented personnel of
our acquired businesses. We will also likely be dependent on members of the
senior management of any business that we acquire in the future. If any of
these persons becomes unable or unwilling to continue his or her role with us,
or if we are unable to attract or retain other qualified employees, future
results could be adversely impacted. Although we have entered into employment
agreements with key executives, we cannot guarantee that any individual will
continue in his present capacity with us for any particular period of time.
The Consolidation of the Healthcare Industry Could Adversely Affect Our Results
Many healthcare providers are consolidating into larger practice groups with
greater market presence. As a result, these providers have greater bargaining
power which may lead to declining prices for our products. This could have an
adverse effect on our future results. In addition, the consolidation of smaller
practice groups may require the resulting larger group to unify its practice
management systems. We believe that once a healthcare provider has chosen a
particular practice management systems vendor, it will rely on that vendor for
its future practice management systems requirements. Thus, the vendor with the
broadest market share will have a competitive advantage as consolidation
continues. An inability to make initial sales of practice management systems to
healthcare providers prior to consolidation or to maintain our existing
customer base subsequent to consolidation may have a material adverse effect on
future results.
We May be Subject to Changing Government Regulations
The confidentiality of patient records and the circumstances under which
such information may be used or released are subject to increasing state and
federal regulation. Regulations governing electronic healthcare data
transmissions are evolving rapidly and are often unclear and difficult to
apply. The Health Insurance Portability and Accountability Act of 1996 mandates
the establishment of national standards for certain types of electronic
8
<PAGE>
healthcare information transactions to ensure the integrity and confidentiality
of such information. We cannot guarantee that such standards will not
materially restrict the ability of our customers to obtain or disseminate
patient information through the use of our products. Any material restriction
on the ability of healthcare providers to obtain or disseminate patient
information could adversely affect our business and future results.
The U.S. Food and Drug Administration ("FDA") has jurisdiction to regulate
computer products and software as medical devices if they are intended for use
in the diagnosis, cure, mitigation, treatment or prevention of disease. We have
not determined the extent to which our practice management software products
would be deemed to be medical devices subject to FDA regulation. Noncompliance
with applicable FDA requirements can result in such things as fines,
injunctions, suspension of production, revocation of approvals or clearances
previously granted, and criminal prosecution. FDA policies, or other laws or
regulations concerning the manufacture or marketing of healthcare information
systems, may increase the cost and time required to deliver new or existing
products and therefore may have a material adverse effect on future results.
Our Management and Major Stockholders Can Influence Stockholder Actions Through
Their Share Ownership
Taking into account all of the shares of common stock outstanding after this
offering, directors, executive officers and major stockholders will
beneficially own approximately 14% of the outstanding shares of common stock.
Although these persons do not presently have any agreements to act in concert,
any such agreement would make it difficult for others to elect the entire Board
of Directors and to control the disposition of any matter submitted to a vote
of stockholders.
Future Sales Of Shares Could Affect Our Stock Price
The market price for our common stock could fall dramatically if our
stockholders sell large amounts of our common stock in the public market. These
sales, or the possibility that these sales may occur, could make it more
difficult for us to sell equity or equity-related securities in the future.
As of the date of this prospectus, there are 12,942,150 shares of common
stock outstanding. Of these shares, shares (including the 3,954,078
shares covered by this prospectus) will be freely tradable upon completion of
this offering, subject to the lock-up agreements discussed below and Rule 144
restrictions. The remaining shares of common stock outstanding are
"restricted securities" under Rule 144 under the Securities Act.
Our shares will become eligible for sale in the public markets as follows:
<TABLE>
<CAPTION>
Date Shares Become Eligible for Resale in the Public
Number of Shares Market
---------------- -----------------------------------------------------
<C> <S>
shares.......... These shares will be freely tradable without
restriction immediately as of the date of this
prospectus.
124,342 shares.......... These shares are subject to 30-day lock-up agreements
and will be freely tradable without restriction
commencing on , 1999. None of the holders
of these shares are "affiliates" of InfoCure as
defined in Rule 144 and none of these shares will be
subject to Rule 144 restrictions.
shares.......... These shares are subject to 90-day lock-up agreements
and will be freely tradable without restriction
commencing on , 1999, provided that
shares are held by affiliates and are subject
to the provisions of Rule 144 that limit the amount
of securities that may be sold in any three month
period.
shares.......... These shares are restricted securities and may be
sold pursuant to Rule 144. Of these shares,
will be eligible to be sold immediately upon
completion of this offering, and the remainder will
become eligible for sale at various dates thereafter.
</TABLE>
9
<PAGE>
The lock-up agreements provide that the holders of the shares may not sell
or otherwise dispose of their shares for a period of 30 to 90 days after the
date of the prospectus for the Underwritten Offering without the prior written
consent of The Robinson-Humphrey Company, LLC. In addition, we have agreed not
to sell any additional shares of common stock for 90 days after the date of
this prospectus without the prior written consent of The Robinson-Humphrey
Company, LLC. The Robinson-Humphrey Company, LLC may release us or the
stockholders from these restrictions, in whole or in part, at any time in its
sole discretion. If holders of our common stock sell a large number of shares
in the public market, our stock price could fall significantly.
Our Certificate of Incorporation and Bylaws and Delaware Law May Inhibit a
Takeover of InfoCure
Certain provisions of Delaware law, our Certificate of Incorporation and
Bylaws could, together or separately, have the effect of delaying, deferring or
preventing an acquisition of InfoCure and limit the price that investors might
be willing to pay in the future for our common stock. These provisions, among
other things: (a) authorize our Board of Directors to issue, without further
stockholder approval, preferred stock with rights and preferences senior to the
rights associated with the common stock; (b) classify the Board of Directors
into three classes of directors with each class serving staggered three year
terms; and (c) limit stockholders' ability to call or make proposals at
stockholder meetings.
FORWARD-LOOKING STATEMENTS
Some of the statements contained in this prospectus contain forward-looking
information. These statements are found in the sections entitled "Prospectus
Summary" and "Risk Factors." They include statements concerning:
. our growth and operating strategy;
. trends in our industry and in healthcare generally; and
. trends in government regulation.
You can identify these statements by forward-looking words such as "expect,"
"believe," "goal," "plan," "intend," "estimate," "may" and "will" or similar
words. You should be aware that those statements are subject to known and
unknown risks, uncertainties and other factors, including those discussed in
the section entitled "Risk Factors," that could cause the actual results to
differ materially from those suggested by the forward-looking statements.
10
<PAGE>
USE OF PROCEEDS
The proceeds from the sale of the common stock offered pursuant to this
prospectus (the "Shares") are solely for the account of the selling
stockholders identified herein (the "Selling Stockholders"). Accordingly,
InfoCure will not receive any proceeds from the sale of the Shares from the
Selling Stockholders.
INFOCURE BACKGROUND
Background
InfoCure was incorporated in Delaware in November 1996. Prior to July 10,
1997, InfoCure conducted no significant operations and generated no revenue.
InfoCure organized its business by combining the operations of six companies
acquired on July 10, 1997. On July 10, 1997, InfoCure also completed its
initial public offering of 1.4 million shares of common stock at a price to the
public of $5.50 per share, resulting in net proceeds to InfoCure of
approximately $6.0 million. On January 25, 1999, InfoCure filed with the
Commission a registration statement for the proposed sale to the public in an
underwritten offering of an estimated 3.0 million shares of common stock (the
"Underwritten Offering").
Acquisitions
Since July 10, 1997, InfoCure has acquired the following 11 companies:
<TABLE>
<CAPTION>
Effective Type of
Name of Acquired Company Date Acquisition
------------------------ ---------- --------------
<S> <C> <C>
SoftEasy Software, Inc. ("SoftEasy") 09/30/1997 Stock Purchase
Commercial Computers, Inc. ("CCI").................. 10/01/1997 Asset Purchase
Professional On-Line Computer, Inc. "POLCI")........ 10/01/1997 Asset Purchase
Pace Financial Corporation ("PACE")................. 11/01/1997 Stock Purchase
The orthodontic business unit of Halis Services,
Inc. ("OPMS")...................................... 12/01/1997 Asset Purchase
Medical Software Integrators, Inc. ("MDI").......... 01/01/1998 Stock Purchase
Micro-Software Designs, Inc. ("MSI")................ 01/01/1998 Asset Purchase
The Healthcare Systems Division ("HSD") of The
Reynolds and Reynolds Company...................... 10/23/1998 Asset Purchase
Radiology Management Systems, Inc. ("RADMAN")....... 12/23/1998 Merger
Macon Systems Management, LLC ("MSM")............... 02/12/1999 Merger
OMSystems, Inc. ("OMS")............................. 02/18/1999 Merger
</TABLE>
Series A Preferred Stock Issuance
On February 9, 1998, InfoCure completed the private placement of 850,060
shares of its Convertible Redeemable Preferred Stock Series A (the "Series A
Preferred"), resulting in gross proceeds to InfoCure of $8.5 million and net
proceeds of approximately $7.8 million after payment of selling commissions to
the placement agent for the offering and other expenses of the offering.
InfoCure granted to the placement agent a warrant to acquire 100,000 shares of
InfoCure's common stock at an exercise price of $9.00 per share.
The Institutional Placement
On September 28, 1998, InfoCure completed the sale of 203,338 shares (the
"Institutional Placement") of common stock in a private placement to an
institutional investor (the "Investor") for $2.5 million. The
11
<PAGE>
Investor committed to invest up to an additional $7.5 million upon the
exercise by InfoCure of options ("Put Options") through February 28, 2000.
Generally, upon exercise of a Put Option, the Investor must tender the amount
designated by InfoCure (the "Investment Amount"). The number of shares to be
issued upon exercise of a Put Option is determined by dividing the Investment
Amount by an amount (the "Subscription Date Price") equal to 92.5% of the
average of the lowest three consecutive trading day closing sale prices of the
common stock during the 22 trading days immediately preceding exercise of such
Put Option. Additionally, InfoCure issued the Investor a five-year warrant to
purchase 100,000 shares of common stock at an exercise price of $23.00 per
share.
Since September 28, 1998, InfoCure has exercised two additional Put
Options, and has issued to the Investor an aggregate 431,322 shares for a
total investment of $7.0 million. Of the 531,322 shares acquired by the
Investor to date or issuable upon exercise of the Investor's warrant, 281,322
shares are offered hereby and 250,000 shares are offered pursuant to the
Underwritten Offering. Of the 281,322 shares offered hereby, 147,980 shares
may be sold by the Investor immediately and 152,003 shares are subject to a
90-day lock-up agreement expiring on the 91st day after the date of the
prospectus relating to the Underwritten Offering. See "Issuance of Common
Stock to Selling Stockholders."
InfoCure is required to file a registration statement to register for
resale by the Investor any shares of common stock issuable upon exercise of
subsequent Put Options. With respect to any Put Option, the Investor is
entitled to receive additional shares of common stock ("Adjustment Shares") if
the amount determined as 92.5% of the average of the lowest three consecutive
trading day closing sales prices of the common stock during the 22 trading
days immediately preceding the effective date of any registration statement
relating to the shares issued upon exercise of such Put Option (the "Effective
Date Price") is lower than the Subscription Date Price. In such event, the
Investor will receive that number of Adjustment Shares determined by
subtracting (x) the Investment Amount divided by the Subscription Date Price
from (y) the Investment Amount divided by the Effective Date Price. InfoCure
has the right to pay cash in lieu of the issuance of Adjustment Shares if the
closing sales price of the common stock on the Effective Date is lower than
$10.00.
ISSUANCE OF COMMON STOCK TO SELLING STOCKHOLDERS
The Selling Stockholders received their Shares of common stock in
transactions with InfoCure as follows:
. 3,016,630 shares of common stock offered hereby were issued in connection
with the acquisitions and mergers consummated with CCI, POLCI, PACE, MDI,
MSI, HSD, RADMAN, MSM and OMS;
. 637,465 shares of common stock offered hereby were issued (or are
issuable pursuant to warrants granted) in connection with the private
placement of $8.5 million of the Series A Preferred; and
. 299,983 shares of common stock offered hereby were issued (or are
issuable pursuant to warrants granted) in connection with the
Institutional Placement.
PLAN OF DISTRIBUTION
Shares of common stock covered hereby may be offered and sold from time to
time by the Selling Stockholders. The Selling Stockholders will act
independently of InfoCure in making decisions with respect to the timing,
manner and size of each sale. The Selling Stockholders may sell the Shares
offered hereby in the following ways: (i) on the Nasdaq Stock Market, the
over-the-counter market or otherwise at prices and at terms then prevailing or
at prices related to the then current market price; or (ii) in private sales
at negotiated prices directly or through a broker or brokers, who may act as
agent or as principal or by a combination of such methods of sale.
12
<PAGE>
The Selling Stockholders and any underwriter, dealer or agent who
participate in the distribution of such shares may be deemed to be
"underwriters" under the Securities Act, and any discount, commission or
concession received by such persons might be deemed to be an underwriting
discount or commission under the Securities Act. InfoCure has agreed to
indemnify the Selling Stockholders against certain liabilities arising under
the Securities Act.
Any broker-dealer participating in such transactions as agent may receive
commissions from the Selling Stockholders (and, if acting as agent for the
purchaser of such shares, from such purchaser). Usual and customary brokerage
fees will be paid by the Selling Stockholders. Broker-dealers may agree with
the Selling Stockholders to sell a specified number of shares at a stipulated
price per share, and, to the extent such a broker-dealer is unable to do so
acting as agent for the Selling Stockholders, to purchase as principal any
unsold shares at the price required to fulfill the broker-dealer commitment to
the Selling Stockholders. Broker-dealers who acquire shares as principals may
thereafter resell such shares from time to time in transactions (which may
involve crosses and block transactions and which may involve sales to and
through other broker-dealers, including transactions of the nature described
above) in the over-the-counter market, in negotiated transactions or by a
combination of such methods of sale or otherwise at market prices prevailing at
the time of sale or at negotiated prices, and in connection with such resales
may pay to or receive from the purchasers of such shares commissions computed
as described above.
InfoCure has advised the Selling Stockholders that the anti-manipulation
rules under the Securities Exchange Act of 1934, as amended (the "Exchange
Act") may apply to sales of Shares in the market and to the activities of the
Selling Stockholders and their affiliates. The Selling Stockholders have
advised the Company that during such time as the Selling Stockholders may be
engaged in the attempt to sell shares registered hereunder, they will: (i) not
engage in any stabilization activity in connection with any of InfoCure's
securities; (ii) not bid for or purchase any of InfoCure's securities or any
rights to acquire Infocure's securities, or attempt to induce any person to
purchase any of InfoCure's securities or rights to acquire InfoCure's
securities other than as permitted under the Exchange Act; (iii) not effect any
sale or distribution of the Shares until after the prospectus shall have been
appropriately amended or supplemented, if required, to set forth the terms
thereof; and (iv) effect all sales of Shares in broker's transactions through
broker-dealers acting as agents, in transactions directly with market makers,
or in privately negotiated transaction where no broker or other third party
(other than the purchaser) is involved.
The Selling Stockholders may indemnify any broker-dealer that participates
in transactions involving the sale of the Shares against certain liabilities,
including liabilities arising under the Securities Act. Any commissions paid or
any discounts or concessions allowed to any such broker-dealers, and any
profits received on the resale of such shares, may be deemed to be underwriting
discounts and commissions under the Securities Act if any such broker-dealers
purchase shares as principal.
In order to comply with the securities laws of certain states, if
applicable, InfoCure's common stock will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
states, the common stock may not be sold unless such shares have been
registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied
with.
Each of the Selling Stockholders has signed a "lock-up" agreement with the
underwriters in the Underwritten Offering. The lock-up agreements restrict the
Selling Stockholders from selling or otherwise disposing of any of their shares
for the period of 90 days immediately following the date of the prospectus
issued in connection with the Underwritten Offering without the prior written
consent of The Robinson-Humphrey Company, LLC, the managing underwriter in the
Underwritten Offering; provided, however, that lock-up agreements for holders
of 497,367 of the Shares provide that such holders may sell up to 124,342 of
such shares commencing 30 days following the date of this prospectus. The
Robinson-Humphrey Company, LLC may, in its sole discretion and without notice,
release all or any portion of the shares from the restrictions in the lock-up
agreements.
13
<PAGE>
InfoCure has agreed to use its best efforts to maintain the effectiveness of
this registration statement with respect to the shares of common stock offered
hereunder by the Selling Stockholders until the earlier of the sale of such
shares or March 27, 2000. No sales may be made pursuant to this prospectus
after such date unless InfoCure amends or supplements this prospectus to
indicate that it has agreed to extend such period of effectiveness. There can
be no assurance that the Selling Stockholders will sell all or any of the
shares of common stock offered hereunder.
SELLING STOCKHOLDERS
All of the Shares registered for sale pursuant to this prospectus will be
owned immediately after registration by the Selling Stockholders. None of the
Selling Stockholders is a director or executive officer of InfoCure, except
that certain Selling Stockholders are or will be non-officer employees of
InfoCure. The following table sets forth certain information known to InfoCure
with respect to beneficial ownership of InfoCure's common stock as of February
24, 1999 by each Selling Stockholder. The following table assumes that the
Selling Stockholders sell all of the Shares. Since each Selling Stockholder may
choose not to sell his or her Shares, InfoCure is unable to state the exact
number of Shares that actually will be sold.
<TABLE>
<CAPTION>
Common
Common Stock Stock to Common Stock
Beneficially Owned be Sold Beneficially Owned
Prior to the in the After the
Offering(1) Offering Offering(1)
------------------ -------- ------------------
Name and Address of Beneficial
Owner Shares Percentage Shares Shares Percentage
------------------------------ ------- ---------- -------- ------- ----------
<S> <C> <C> <C> <C> <C>
William Herbert Hunt Trust
Estate(2)..................... 548,932 4.2% 315,812 233,120 1.8%
James D. Davis................. 400,000 3.1 400,000 -- --
Reid W. Simmons................ 400,000 3.1 400,000 -- --
Richard A. Perlman(3).......... 352,055 2.7 110,000 242,055 1.9
Crescent International
Limited(4).................... 299,983 2.3 299,983 -- --
Bailey, Joe M.................. 4,354 * 4,354 -- --
Ball, George L................. 4,354 * 4,354 -- --
Ball, Susan Huffard............ 4,354 * 4,354 -- --
Barbour, Carol C............... 2,176 * 2,176 -- --
Brewster, John C. and
Marianna...................... 2,176 * 2,176 -- --
Chadwick, Michael S............ 2,176 * 2,176 -- --
Cockspur, Inc.................. 4,354 * 4,354 -- --
Cohn Holstead, Anne Lindsay.... 4,354 * 4,354 -- --
Cohn, Bobby Smith.............. 4,354 * 4,354 -- --
Cohn McConnell, Kirby.......... 4,354 * 4,354 -- --
Cohn, Morton A................. 30,480 * 30,480 -- --
Colville, G. Christopher....... 2,176 * 2,176 -- --
Cummings, Alan G............... 4,354 * 4,354 -- --
Custer, Thomas W............... 4,354 * 4,354 -- --
Davis, Charles L............... 1,089 * 1,089 -- --
DeArman, William M............. 4,354 * 4,354 -- --
DelHomme, Louis................ 4,354 * 4,354 -- --
Dillard, Max M................. 4,354 * 4,354 -- --
Drury, John E.................. 8,709 * 8,709 -- --
Duddlesten, Wayne B............ 8,709 * 8,709 -- --
Elkins Jr., J.A. and Margaret
W............................. 4,354 * 4,354 -- --
Ellis, Leigh and Mimi G........ 2,176 * 2,176 -- --
Ener Corporation............... 1,089 * 1,089 -- --
Fitch, Don..................... 4,354 * 4,354 -- --
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
Common Stock Common Common Stock
Beneficially Stock to Beneficially
Owned be Sold Owned
Prior to the in the After the
Offering(1) Offering Offering(1)
----------------- -------- -----------------
Name and Address of Beneficial
Owner Shares Percentage Shares Shares Percentage
------------------------------ ------ ---------- -------- ------ ----------
<S> <C> <C> <C> <C> <C>
Flom, Joseph..................... 4,354 * 4,354 -- --
Fogarty, William H............... 6,220 * 6,220 -- --
Fordham, Scott................... 2,176 * 2,176 -- --
Frost Family I, Ltd.............. 4,354 * 4,354 -- --
Gunther, Don J. and Rosemary T... 2,176 * 2,176 -- --
Hagans, Fred..................... 4,354 * 4,354 -- --
Hamblen III, Tolar............... 2,176 * 2,176 -- --
Harter, Steve.................... 4,354 * 4,354 -- --
Hebert, L. Carl and Edith C...... 4,354 * 4,354 -- --
Herbold, William K. and Norma
Rae............................. 2,176 * 2,176 -- --
Higdon Compton Insurance......... 2,176 * 2,176 -- --
Hopson, Courtney Lyle Cohn....... 4,354 * 4,354 -- --
Hutson, Miles A.................. 2,176 * 2,176 -- --
J-All Partnership................ 13,063 * 13,063 -- --
James Ventures, L.P.............. 52,252 * 52,252 -- --
Johnson, Walter.................. 2,176 * 2,176 -- --
Jones, Austin and Margaret....... 4,354 * 4,354 -- --
Jones, Samuel A.................. 2,176 * 2,176 -- --
Keenan, Ltd...................... 4,354 * 4,354 -- --
Keller, Susan K.................. 2,176 * 2,176 -- --
Kinder, Nancy G.................. 4,354 * 4,354 -- --
Kinder, Richard D................ 4,354 * 4,354 -- --
Kinney, Robert Larry............. 4,354 * 4,354 -- --
Lary, Robert W................... 4,354 * 4,354 -- --
Lawlor, Michael P. and Helen C... 4,354 * 4,354 -- --
Lay, Kenneth L. and Linda P...... 8,709 * 8,709 -- --
Lindsey Spicer #1 Trust.......... 4,354 * 4,354 -- --
Lindstedt, Roger P............... 17,417 * 17,417 -- --
Malanga, John H. and Jodi F...... 1,155 * 1,155 -- --
McAninch, Ed..................... 4,354 * 4,354 -- --
McClanahan, Randy J. and Jennifer
G............................... 4,354 * 4,354 -- --
McConnell, Michael H............. 1,089 * 1,089 -- --
McMaken, Bruce................... 1,089 * 1,089 -- --
Mitchell, Michael................ 2,176 * 2,176 -- --
Moorehead Jr., Donald F.......... 13,063 * 13,063 -- --
Moorehead, George................ 2,176 * 2,176 -- --
Moorehead, Shelley B............. 13,063 * 13,063 -- --
Morris, Ben T.................... 4,354 * 4,354 -- --
Mundy, John I.................... 2,176 * 2,176 -- --
O'Neill, Katherine Halliday...... 2,176 * 2,176 -- --
O'Quinn, John M.................. 17,417 * 17,417 -- --
Platinum Business Investment
Company, Ltd.................... 21,771 * 21,771 -- --
Poarch, Donald L................. 2,176 * 2,176 -- --
Quigley, Leroy E................. 2,176 * 2,176 -- --
Rauch, Leonard................... 4,354 * 4,354 -- --
Reamer, R.E. Individual
Retirement Account.............. 2,176 * 2,176 -- --
Rimmer, Jr., Roy T............... 4,354 * 4,354 -- --
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Common Common Stock
Common Stock Stock to Beneficially
Beneficially Owned be Sold Owned
Prior to the in the After the
Offering(1) Offering Offering(1)
------------------ -------- -----------------
Name and Address of Beneficial
Owner Shares Percentage Shares Shares Percentage
------------------------------ ------- ---------- -------- ------ ----------
<S> <C> <C> <C> <C> <C>
Rogers, Franelle................ 2,176 * 2,176 -- --
Rome, Mark A.................... 1,089 * 1,089 -- --
Ross, Rex C. and Adrian T....... 4,354 * 4,354 -- --
Ryan, Nolan..................... 4,354 * 4,354 -- --
Sanders, Brad D................. 2,176 * 2,176 -- --
Sanders, Bret D................. 2,176 * 2,176 -- --
Sanders, Christine M............ 2,176 * 2,176 -- --
Sanders, Don A.................. 32,657 * 32,657 -- --
Sanders, Katherine U............ 21,771 * 21,771 -- --
Sanders, Laura K................ 2,176 * 2,176 -- --
Scott, Stephen D................ 21,771 * 21,771 -- --
Slovin, Bruce................... 8,709 * 8,709 -- --
Spicer, Sherri.................. 4,354 * 4,354 -- --
Tanglewood Family Limited Part.. 2,176 * 2,176 -- --
Tate, Paul and Lara M........... 2,176 * 2,176 -- --
Tompkins, Jack I................ 4,354 * 4,354 -- --
Towery, David................... 2,176 * 2,176 -- --
Weir, Don and Julie Ellen....... 2,176 * 2,176 -- --
Weir, Eric G.................... 2,176 * 2,176 -- --
Weir, Lisa Dawn................. 2,176 * 2,176 -- --
Wolf Canyon, Ltd................ 4,354 * 4,354 -- --
Sanders Morris Mundy Inc........ 100,000 * 100,000 -- --
Willensky, Harvey and Marjorie.. 100,664 * 100,664 -- --
James R. Hegler Revocable Living
Trust.......................... 32,314 * 32,314 -- --
Phyllis J. Hegler Revocable
Living Trust................... 32,142 * 32,142 -- --
Black, John M................... 164,000 1.3% 164,000 -- --
Humphrey, Todd J................ 20,000 * 20,000 -- --
Micro-Software Designs, Inc..... 135,000 1.0% 135,000 -- --
Warenik, Philip E............... 13,738 * 13,738 -- --
Chaney, Patrick................. 1,571 * 1,571 -- --
Hawksford, Thomas E............. 26,393 * 26,393 -- --
Laurelyn Horsfall............... 440 * 440 -- --
Horsfall, Richard............... 2,765 * 2,765 -- --
Malmquist, Jay P................ 4,713 * 4,713 -- --
Schraut, Brad E................. 34,437 * 34,437 -- --
Vagle, Erik E................... 940 * 940 -- --
Vagle, Melvin C................. 38,607 * 38,607 -- --
Vagle, Ronald M................. 129,690 * 75,525 54,165 --
Winkelman, Joe.................. 500 * 500 -- --
Bourne, Craig................... 4,186 * 4,186 -- --
Caputo, Donald E................ 811 * 811 -- --
Holmes, Steven M................ 5,300 * 5,300 -- --
Johnson, Dick................... 7,000 * 7,000 -- --
Kloner, Marc.................... 109,587 * 109,587 -- --
Kubler, Pamela.................. 957 * 957 -- --
Teese, Charles F................ 2,093 * 2,093 -- --
Finova Capital Corporation...... 245,000 1.9% 245,000 -- --
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
Common Common Stock
Common Stock Stock to Beneficially
Beneficially Owned be Sold Owned
Prior to the in the After the
Offering(1) Offering Offering(1)
------------------ --------- -----------------
Name and Address of Beneficial
Owner Shares Percentage Shares Shares Percentage
------------------------------ ------- ---------- --------- ------ ----------
<S> <C> <C> <C> <C> <C>
Cheramy, Edward R.............. 13,056 * 13,056 -- --
Maline, David B., M.D.......... 12,006 * 12,006 -- --
Quiat, Barry................... 12,227 * 12,227 -- --
Sudikoff, Jeffrey P............ 13,056 * 13,056 -- --
The David B. Maline, M.D.
Profit Sharing Plan and
Trust......................... 12,006 * 12,006 -- --
Turkanis, Ellen................ 4,441 * 4,441 -- --
Turkanis-Price Family Trust UTD
August 27, 1998............... 391,899 3.0% 391,899 -- --
Williams, Robert............... 4,557 * 4,557 -- --
Barnes Family Holdings, LLC.... 26,218 * 26,218 -- --
delaRosa Family Holdings, LLC.. 15,398 * 15,398 -- --
Baker, Steve................... 9,728 * 9,728 -- --
Bolton, Harold................. 9,152 * 9,152 -- --
Case, Stephen Anthony.......... 8,728 * 8,728 -- --
Garrison, Richard Allan........ 3,000 * 3,000 -- --
Haddad, Michael J.............. 1,975 * 1,975 -- --
Hofstetter, Joseph M., Jr...... 30,760 * 30,760 -- --
Hornick, Keith................. 1,888 * 1,888 -- --
Horton, Cyrus William.......... 7,000 * 7,000 -- --
Kearney, Thomas L., Jr......... 20,320 * 20,320 -- --
Sentell, Jane Elizabeth........ 1,000 * 1,000 -- --
Sentell, Craig Martin.......... 11,000 * 11,000 -- --
Sexton, Jacob Paul............. 4,000 * 4,000 -- --
Stuff, James Robert............ 5,720 * 5,720 -- --
Whitt, Susan F................. 3,000 * 3,000 -- --
---------
Total........................ 3,954,078
=========
</TABLE>
- --------
* Less than one percent.
(1) Information with respect to "beneficial ownership" shown in the table above
is based on information supplied by the respective beneficial owner or by
other stockholders as well as filings made with the Commission or furnished
to InfoCure and assumes completion of the Underwritten Offering. For
purposes of calculating the percentage beneficially owned, the shares of
common stock deemed outstanding (a) include: (i) 8,888,936 shares
outstanding as of February 24, 1999; (ii) 1,000,070 shares issuable upon
the conversion of the 850,060 shares of Series A Preferred; (iii) 100,644
shares issuable upon conversion of outstanding convertible notes; and (iv)
shares issuable by InfoCure pursuant to options, warrants and convertible
securities held by the respective person or group which may be exercised or
converted within 60 days following the date of this prospectus ("Presently
Exercisable Options"); and (b) exclude 47,500 shares that are issuable upon
the attainment of vesting goals applicable to restricted stock awards.
Presently Exercisable Options are deemed to be outstanding and to be
beneficially owned by the person or group holding such options for the
purpose of computing the percentage ownership of such person or group but
are not treated as outstanding for the purpose of computing the percentage
ownership of any other person or group. Unless otherwise specified, the
mailing address of each beneficial owner is c/o InfoCure Corporation, 1765
The Exchange, Suite 450, Atlanta, Georgia 30339.
(2) According to a Schedule 13D filed by The William Herbert Hunt Trust Estate
(the "Hunt Trust") dated February 19, 1998, the Hunt Trust has sole voting
and dispositive power as to the shares of common stock. The common stock
total includes 315,811 shares of common stock issuable upon conversion of
17
<PAGE>
268,440 shares of Series A Preferred at a conversion price of $8.50 per
share. The mailing address of the Hunt Trust is 3900 Thanksgiving Tower,
1601 Elm Street, Dallas, Texas 75201.
(3) Includes (i) 195,691 shares held by Compass Partners, L.L.C. (an entity
controlled by Richard E. Perlman); (ii) 110,000 shares issuable to Compass
Partners, L.L.C. upon exercise of an outstanding warrant at an exercise
price of $5.50 per share; (iii) 15,000 shares held in a deferred
compensation trust on behalf of Mr. Perlman; and (iv) 47,364 shares
issuable to Mr. Perlman upon the exercise of Presently Exercisable Options.
(4) According to a Schedule 13D, as amended, filed by Crescent International
Limited ("Crescent") dated December 21, 1998, Crescent has sole voting and
dispositive power as to the shares of common stock. The common stock total
includes 15,790 shares of common stock issuable upon conversion of 13,422
shares of Series A Preferred at a conversion price of $8.50 per share and
100,000 shares issuable upon exercise of a warrant at an exercise price of
$23.00 per share. Crescent's mailing address is c/o Greenlight
(Switzerland) SA, 84, Av Louis-Casai, P.O. Box 42, 1216, Geneva, Cointrin,
Switzerland.
LEGAL MATTERS
The validity of the issuance of the shares of the common stock offered
hereby will be passed upon for InfoCure and the Selling Stockholders by Morris,
Manning & Martin, L.L.P., Atlanta, Georgia. Employees of Morris, Manning &
Martin, L.L.P. own an aggregate 57,760 shares of InfoCure's common stock.
EXPERTS
The Consolidated Financial Statements of InfoCure Corporation as of December
31, 1997 and 1998 and for the year ended January 31, 1997, the eleven months
ended December 31, 1997 and the year ended December 31, 1998 incorporated
herein by reference have been audited by BDO Seidman, LLP, independent
auditors, as set forth in their reports thereon appearing elsewhere herein and
incorporated herein by reference, and are included in reliance upon such
reports given upon the authority of such firm as experts in accounting and
auditing.
18
<PAGE>
PART II
Item 14. Other Expenses of Issuance and Distribution
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee.............. $31,944
Accountants' fees and expenses................................... 5,000
Legal fees and expenses.......................................... 5,000
Miscellaneous.................................................... 5,000
-------
Total Expenses................................................. $46,944
</TABLE>
All fees other than the Commission registration fee are estimated. None of
the expenses of the issuance and distribution of the common stock being offered
will be borne by the Selling Stockholders.
Item 15. Indemnification of Directors and Officers
InfoCure's Bylaws effectively provide that InfoCure shall, to the full
extent permitted by Section 145 of the General Corporation Law of the State of
Delaware, as amended from time to time ("Section 145"), indemnify all persons
whom it may indemnify pursuant thereto. In addition, InfoCure's Certificate of
Incorporation eliminates personal liability of its directors to the full extent
permitted by Section 102(b)(7) of the General Corporation Law of the State of
Delaware, as amended from time to time ("Section 102(b)(7)").
Section 145 permits a corporation to indemnify its directors and officers
against expenses (including attorney's fees), judgments, fines and amounts paid
in settlements actually and reasonably incurred by them in connection with any
action, suit, or proceeding brought by a third party of such directors or
officers acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to
any criminal action or proceeding, had no reason to believe their conduct was
unlawful. In a derivative action, indemnification may be made only for expenses
actually and reasonably incurred by directors and officers in connection with
the defense or settlement of an action or suit and only with respect to a
matter as to which they shall have acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interest of the
corporation, except that no indemnification shall be made if such person shall
have been adjudged liable to the corporation, unless and only to the extent
that the court in which the action or suit was brought shall determine upon
application that the defendant officers or directors are reasonably entitled to
indemnity for such expenses despite such adjudication of liability.
Section 102(b)(7) provides that a corporation may eliminate or limit the
personal liability of a director to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director, provided that such
provision shall not eliminate or limit the liability of a director (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for willful or
negligent conduct in paying dividends or repurchasing stock out of other than
lawfully available funds or (iv) for any transaction from which the director
derived an improper benefit. No such provision shall eliminate or limit the
liability of a director for any act or omission occurring prior to the date
when such provision becomes effective.
II-1
<PAGE>
Item 16. Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
3.1 Amended Certificate of Incorporation of InfoCure (incorporated by
reference to Exhibit of the same number filed with InfoCure's
Registration Statement on Form SB-2) (Registration No. 333-18923).
3.2 Amended and Restated Bylaws of InfoCure (incorporated by reference to
Exhibit of the same number filed with InfoCure's Registration
Statement on Form S-3) (Registration No. 333-71109).
4.1 See Exhibits 3.1 and 3.2 for provisions of the Amended Certificate of
Incorporation and Bylaws of InfoCure defining rights of the holders of
common stock of InfoCure.
4.2 Specimen Certificate of shares of common stock (incorporated by
reference to Exhibit of the same number filed with InfoCure's
Registration Statement on Form SB-2) (Registration No. 333-18923).
5.1* Opinion of Morris, Manning & Martin, L.L.P., Counsel to InfoCure, as
to legality of the shares being registered.
23.1 Consent of BDO Seidman, LLP
23.4* Consent of Morris, Manning & Martin, L.L.P. (included in Exhibit 5.1)
24.1 Powers of Attorney (included on signature page)
</TABLE>
- --------
* To be filed by amendment
Item 17. Undertakings
(a) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that, in the opinion of the Commission, such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
(c)The undersigned registrant hereby undertakes that:
(i) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in the form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(ii) For purposes of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Atlanta, State of Georgia on the 26th day of
February, 1999.
INFOCURE CORPORATION
/s/ Frederick L. Fine
By: _________________________________
Frederick L. Fine President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Frederick L. Fine, Richard E. Perlman and James
K. Price, and each of them, his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and any
subsequent registration statements pursuant to Rule 462 of the Securities Act
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that each of said attorney-in-fact or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ Frederick L. Fine President, Chief February 26, 1999
- --------------------------------- Executive Officer and
Frederick L. Fine Director (Principal
Executive Officer)
/s/ James K. Price Executive Vice February 26, 1999
- --------------------------------- President, Secretary
James K. Price and Director
/s/ Richard E. Perlman Chairman, Treasurer and February 26, 1999
- --------------------------------- Director
Richard E. Perlman
/s/ Lance B. Cornell Senior Vice President-- February 26, 1999
- --------------------------------- Finance and Chief
Lance B. Cornell Financial Officer
(Principal Financial
Officer)
/s/ Michael E. Warren Vice President and February 26, 1999
- --------------------------------- Director
Michael E. Warren
/s/ Gary W. Plumer Vice President--Finance, February 26, 1999
- --------------------------------- Assistant Secretary and
Gary W. Plumer Assistant Treasurer
(Principal
Accounting Officer)
/s/ James D. Elliot Director February 26, 1999
- ---------------------------------
James D. Elliot
/s/ Raymond H. Welsh Director February 26, 1999
- ---------------------------------
Raymond H. Welsh
II-3
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
InfoCure Corporation
Atlanta, Georgia
We hereby consent to the use of our report relating to the consolidated
financial statements of InfoCure Corporation as of December 31, 1997 and 1998
incorporated by reference in the prospectus constituting a part of this
registration statement number 333-_____ on Form S-3; in the prospectus
constituting a part of the registration statement number 333-48829 on Form S-8;
and in the prospectus constituting the registration statement number 333-71109
on Form S-3.
We also consent to the reference to us under the caption "Experts" in the
prospectus.
BDO Seidman, LLP
Atlanta, Georgia
February 26, 1999
