AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 24, 1997
REGISTRATION NO. 333-28937
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
APPLE ORTHODONTIX, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
8021
(PRIMARY STANDARD INDUSTRIAL
CLASSIFICATION CODE NUMBER)
DELAWARE 74-2795193
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
------------------------
APPLE ORTHODONTIX, INC.
2777 ALLEN PARKWAY
SUITE 880
HOUSTON, TEXAS 77019
(281) 698-2500
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
H. STEVEN WALTON
APPLE ORTHODONTIX, INC.
2777 ALLEN PARKWAY
SUITE 880
HOUSTON, TEXAS 77019
(281) 698-2500
(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
RICHARD S. ROTH
JACKSON & WALKER, L.L.P.
1100 LOUISIANA
SUITE 4200
HOUSTON, TEXAS 77002
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
------------------------
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction C, check the following box. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE 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 OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
DELAWARE GENERAL CORPORATION LAW
Section 145(a) of the General Corporation Law of the State of Delaware (the
"DGCL") provides that a corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorney's
fees), judgements, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he 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 reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he 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 reasonable cause to believe that his conduct was unlawful.
Section 145(b) of the DGCL states that a corporation may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorney's fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
Section 145(c) of the DGCL provides that to the extent that a director,
officer, employee or agent of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in
subsections (a) and (b) of Section 145, or in defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including attorney's
fees) actually and reasonably incurred by him in connection therewith.
Section 145(d) of the DGCL states that any indemnification under
subsections (a) and (b) of Section 145 (unless ordered by a court) shall be made
by the corporation only as authorized in the specific case upon a determination
that indemnification of the director, officer, employee or agent is proper in
the circumstances because he has met the applicable standard of conduct set
forth in subsections (a) and (b). Such determination shall be made (1) by the
board of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or (2) if such a quorum is
not obtainable, or, even if obtainable, a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (3) by the
stockholders.
Section 145(e) of the DGCL provides that expenses (including attorneys'
fees) incurred by an officer or director in defending any civil, criminal,
administrative or investigative action, suit or proceeding may be paid by the
corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of
II-1
<PAGE>
an undertaking by or on behalf of such director or officer to repay such amount
if it shall ultimately be determined that he is not entitled to be indemnified
by the corporation as authorized in Section 145. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the board of directors deems appropriate.
Section 145(f) of the DGCL states that the indemnification and advancement
of expenses provided by, or granted pursuant to, the other subsections of
Section 145 shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be entitled under any
bylaw, agreement, vote of stockholders or disinterested directors or otherwise,
both as to action in his official capacity and as to action in another capacity
while holding such office.
Section 145(g) of the DGCL provides that a corporation shall have the power
to purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would have the power to indemnify him against such liability under the
provisions of Section 145.
Section 145(j) of the DGCL states that the indemnification and advancement
of expenses provided by, or granted pursuant to, Section 145 shall, unless
otherwise provided when authorized or ratified, continue as to a person who has
ceased to be a director, officer, employee or agent, and shall inure to the
benefit of the heirs, executors and administrators of such a person.
CERTIFICATE OF INCORPORATION
The Restated Certificate of Incorporation of the Company provides that a
director of the Company shall not be personally liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
Company or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the DGCL or (iv) for any transaction from which the director
derived an improper personal benefit. If the DGCL is amended to authorize the
further elimination or limitation of the liability of directors, then the
liability of a director of the Company, in addition to the limitation on
personal liability described above, shall be limited to the fullest extent
permitted by the amended DGCL. Further, any repeal or modification of such
provision of the Restated Certificate of Incorporation by the stockholders of
the Company shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Company existing at
the time of such repeal or modification.
BYLAWS
The Bylaws of the Company provide that the Company will indemnify and hold
harmless any director or officer of the Company to the fullest extent permitted
by applicable law, as in effect as of the date of the adoption of the Bylaws or
to such greater extent as applicable law may thereafter permit, from and against
all losses, liabilities, claims, damages, judgments, penalties, fines, amounts
paid in settlement and expenses (including attorneys' fees) whatsoever arising
out of any event or occurrence related to the fact that such person is or was a
director or officer of the Company and further provide that the Company may, but
is not required to, indemnify and hold harmless any employee or agent of the
Company or a director, officer, employee or agent of any other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise who
is or was serving in such capacity at the written request of the Company;
provided, however, that the Company is only required to indemnify persons
serving as directors, officers, employees or agents of the Company for the
expenses incurred in a proceeding if such person is a party to and is
successful, on the merits or otherwise, in such proceeding, or if unsuccessful
in the proceeding, but successful as to a matter in such proceeding, the
expenses attributable to such matter and provided further that the Company may,
but is not required to, indemnify such persons who are serving as a director,
officer, employee or agent of any other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise at the written request of the
Company for the expenses incurred in a proceeding if such person is a party to
and is
II-2
<PAGE>
successful, on the merits or otherwise, in such proceeding. The Bylaws further
provide that, in the event of any threatened, or pending action, suit or
proceeding in which any of the persons referred to above is a party or is
involved and that may give rise to a right of indemnification under the Bylaws,
following written request by such person, the Company will promptly pay to such
person amounts to cover expenses reasonably incurred by such person in such
proceeding in advance of its final disposition upon the receipt by the Company
of (i) a written undertaking executed by or on behalf of such person providing
that such person will repay the advance if it is ultimately determined that such
person is not entitled to be indemnified by the Company as provided in the
Bylaws and (ii) satisfactory evidence as to the amount of such expenses.
UNDERWRITING AGREEMENT
The Underwriting Agreement relating to the IPO provides for the
indemnification of the directors and officers of the Company in certain
circumstances.
TRICAP PARTNERS, L.L.C. AGREEMENT
The financial advisory consulting agreement provides for the
indemnification of the directors and officers of the Company in certain
circumstances.
INSURANCE
The Company intends to maintain liability insurance for the benefit of its
directors and officers.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits.
EXHIBIT
NUMBER DESCRIPTION
------- -----------
2.1+ -- Form of Agreement and Plan of Reorganization
2.2+ -- Form of Uniform Provisions relating to Agreement and Plan of
Reorganization
2.3+ -- Form of Uniform Provisions relating to Contribution Agreement
with Sole Proprietorships
2.4+ -- Form of Uniform Provisions relating to Contribution Agreement
with Professional Corporations or Professional Associations
2.5+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Orthodontics Exclusively, Ltd. and Paul Bonham, D.D.S.
2.6+ -- Contribution Agreement among Apple Orthodontix, Inc., Duncan
Y. Brown P.C. and Dr. Duncan Y. Brown.
2.7+ -- Contribution Agreement among Apple Orthodontix, Inc., Roger
L. Bumgarner, D.D.S., P.C., Roger Bumgarner, D.D.S., P.C. and
Roger L. Bumgarner, D.D.S.
2.8+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Thomas K. Chubb, D.D.S.
2.9+ -- Contribution Agreement among Apple Orthodontix, Inc., Stanley
D. Crawford, D.D.S., P.C. and Stanley D. Crawford, D.D.S.
2.10+ -- Contribution Agreement among Apple Orthodontix, Inc., Western
New York Orthodontic Care, P.C. and Anthony G. Deluke, D.D.S.
2.11+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Robert J. Dennington, D.D.S., M.S.D.
2.12+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Philip DePasquale, D.D.S.
2.13+ -- Contribution Agreement among Apple Orthodontix, Inc., Robert
S. Fields, D.M.D., P.C. and Robert S. Fields, D.M.D.
2.14+ -- Contribution Agreement among Apple Orthodontix, Inc. and
Robert C. Frantz, D.D.S., P.C. and Robert C. Frantz, D.D.S.
2.15+ -- Contribution Agreement among Apple Orthodontix, Inc., Andrew
Girardot, Jr., D.D.S., P.C. and Andrew Girardot, Jr., D.D.S.
II-3
<PAGE>
2.16+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Bruce S. Harris, D.D.S., Inc. and Bruce S. Harris,
D.D.S.
2.17+ -- Contribution Agreement among Apple Orthodontix, Inc., James
H. Jennings, D.D.S., P.A. and James H. Jennings, D.D.S.
2.18+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Phillip Milanovich, D.D.S., M.S., P.C. and Phillip
Milanovich, D.D.S., M.S.
2.19+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Bowen D. Miles, D.M.D.
2.20+ -- Contribution Agreement among Apple Orthodontix, Inc., Mark J.
Mills, D.D.S., P.C. and Mark J. Mills, D.D.S.
2.21+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Carlos F. Navarro, D.D.S., M.S.D., P.C. and Carlos F.
Navarro, D.D.S., M.S.D.
2.22+ -- Contribution Agreement among Apple Orthodontix, Inc., Paul
Rigali, D.D.S., P.C. and Paul Rigali, D.D.S.
2.23+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Carl P. Roy, D.D.S., M.S., P.C. and Carl P. Roy,
D.D.S., M.S.
2.24+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Budd Rubin, D.D.S., M.S., Inc. and Budd Rubin, D.D.S.,
M.S.
2.25+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., John Dell Sauter, D.D.S., M.D.S., P.C. and John Dell
Sauter, D.D.S., M.D.S.
2.26+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Donald D. Schmitz, D.D.S., M.S., Ltd. and Donald D.
Schmitz, D.D.S., M.S.
2.27+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Dr. Charles L. Schnibben, Ltd. and Charles L.
Schnibben, D.D.S.
2.28+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Darrell G. Smith, D.D.S., P.C. and Darrell G. Smith,
D.D.S.
2.29+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Ronald N. Spiegel, D.M.D., Inc. and Ronald N. Spiegel,
D.M.D.
2.30+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Michael C. Theurer, D.D.S.
2.31+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Thomas A. Tiller, D.D.S., Inc. and Thomas A. Tiller,
D.D.S.
2.32+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Jack D. Utley, Jr., D.M.D., P.C. and Jack D. Utley,
Jr., D.M.D.
2.33+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., John G. Vondrak Apple Orthodontix, Inc. and John G.
Vondrak, D.D.S.
2.34+ -- Contribution Agreement between Apple Orthodontix, Inc. and
Ira S. Wiedman, D.D.S.
2.35+ -- Agreement and Plan of Reorganization among Apple Orthodontix,
Inc., Ronald H. Roth, D.D.S. and Brian W. Wong, D.D.S., P.C.
and Brian W. Wong, D.D.S. The schedules and exhibits to the
foregoing acquisition agreements have not been filed as
exhibits to this Registration Statement. Pursuant to Item
601(b)(2) of Regulation S-K, Apple agrees to furnish a copy
of such schedules and exhibits to the Commission upon
request.
3.1+ -- Restated Certificate of Incorporation
3.2+ -- Bylaws
3.3* -- Certificate of Amendment to Restated Certificate of
Incorporation
4.1+ -- Form of certificate evidencing ownership of Common Stock of
Apple Orthodontix, Inc.
4.2+ -- Form of Registration Rights Agreement
4.3+ -- Registration Rights Agreement among Apple Orthodontix, Inc.,
John G. Vondrak, D.D.S. and TriCap Funding I, L.L.C.
4.4+ -- Registration Rights Agreement between TriCap Partners, L.L.C.
and Apple Orthodontix, Inc.
II-4
<PAGE>
5.1 -- Opinion of H. Steven Walton
10.1+ -- Apple Orthodontix, Inc., 1996 Stock Option Plan
10.2+ -- Employment Agreement between Apple Orthodontix, Inc. and John
G. Vondrak, D.D.S.
10.3+ -- Employment Agreement between Apple Orthodontix, Inc. and
Robert J. Syverson
10.4+ -- Employment Agreement between Apple Orthodontix, Inc. and
Michael W. Harlan
10.5+ -- Employment Agreement between Apple Orthodontix, Inc. and W.
Daniel Cook
10.6+ -- Form of California Service Agreement
10.7+ -- Employment Agreement of H. Steven Walton
10.8+ -- Form of Service Agreement
10.9+ -- Consulting Agreement between TriCap Partners, L.L.C. and
Apple Orthodontix, Inc.
10.10+ -- Amendment to Consulting Agreement between TriCap Partners and
Apple Orthodontix, Inc.
10.11+ -- Form of Flat Fee Service Agreement
23.1* -- Consent of Arthur Andersen LLP
23.2 -- Consent of H. Steven Walton (contained in Exhibit 5.1)
24.1* -- Power of Attorney (contained on the signature page of this
Registration Statement)
27.1 -- Financial Data Schedule
- ------------
+ Previously filed as an exhibit to the Company's Registration Statement on
Form S-1 (No. 333-22785), and incorporated herein by reference.
* Previously filed
(b) Financial Statement Schedules.
All schedules are omitted because they are not applicable or because the
required information is contained in the Financial Statements or Notes thereto.
ITEM 17. UNDERTAKINGS.
(a) The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration
Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment 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 initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
II-5
<PAGE>
(4) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise,
the Company 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
Company of expenses incurred or paid by a director, officer or controlling
person of the Company 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 Company 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.
(5) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within
the meaning of Rule 145(c), the issuer undertakes that such reoffering
prospectus will contain the information called for by the applicable
registration form with respect to reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other Items
of the applicable form.
(6) That every prospectus (i) that is filed pursuant to paragraph (5)
immediately preceding, or (ii) that purports to meet the requirements of
Section 10(a)(3) of the Securities Act and is used in connection with an
offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act, each such post-effective amendment 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) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
Form, within one business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt means. This
includes information contained in documens filed subsequent to the effective
date of the registration statement through the date of responding to the
request.
(c) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective.
II-6
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
APPLE ORTHODONTIX, INC. HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
HOUSTON, STATE OF TEXAS, ON JUNE 24, 1997.
APPLE ORTHODONTIX, INC.
By: /s/ JOHN G. VONDRAK, D.D.S.
JOHN G. VONDRAK, D.D.S.
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
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 INDICATED AND ON JUNE 24, 1997.
SIGNATURES TITLE
---------- -----
/s/JOHN G. VONDRAK, D.D.S. Chairman of the Board and Chief
JOHN G. VONDRAK, D.D.S. Executive Officer (Principal Executive
Officer)
/s/MICHAEL W. HARLAN Vice President and Chief Financial
MICHAEL W. HARLAN Officer (Principal Financial and
Accounting Officer)
/s/W. DANIEL COOK * Director
W. DANIEL COOK
/s/WILLIAM W. SHERRILL * Director
WILLIAM W. SHERRILL
By /s/ MICHAEL W. HARLOW
Michael W. Harlow
individually and as
attorney-in-fact
II-7
EXHIBIT 5.1
June 24, 1997
Apple Orthodontix, Inc.
2777 Allen Parkway
Suite 700
Houston, TX 77019
Re: Registration Statement on Form S-4, Registration No. 333-28937 of
Apple Orthodontix, Inc.
Gentlemen:
I am General Counsel of Apple Orthodontix, Inc., a Delaware corporation
(the "Company"), in connection with the registration under the Securities Act of
1933, as amended (the "Act"), of the offering and sale of up to 2,000,000 shares
of the Company's Class A Common Stock, par value $0.001 per share (the
"Shares"), which Shares will be issuable from time to time in connection with
the future direct and indirect acquisitions of other businesses, properties or
securities in business combination transactions by the Company pursuant to Rule
415 under the Act (the "Transactions"). A Registration Statement on Form S-4 ,
Registration No. 333- 28937 (the "Registration Statement") covering the offering
and sale of the Shares was filed with the Securities and Exchange Commission
(the "Commission") on June 11, 1997.
In reaching the conclusions expressed in this opinion, I have examined and
relied upon the originals or certified copies of all documents, certificates and
instruments as I have deemed necessary to the opinions expressed herein. In
making the foregoing examinations, I have assumed the genuineness of all
signatures on original documents, the authenticity of all documents submitted to
us as originals and the conformity to original documents of all copies submitted
to us.
Based solely upon the foregoing, subject to the comments hereinafter
stated, and limited in all respects to the laws of the State of Texas, the
General Corporation Law of the State of Delaware and the federal laws of the
United States of America, it is my opinion that the Shares, when issued in
connection with the Transactions, assuming the consideration received by the
Company in such Transactions exceeds the aggregate par value of the Shares
issued in such Transactions, will be duly authorized, validly issued, fully paid
and nonassessable.
<PAGE>
You should be aware that I am not admitted to the practice of law in the
State of Delaware. Accordingly, any opinion herein as to the laws of the State
of Delaware is based solely upon the latest generally available compilation of
the statutes and case law of such state.
I hereby consent to the use of this opinion as an Exhibit to the
Registration Statement and to the use of my name in the Registration Statement
under the caption "Legal Matters." In giving this consent, I do not admit that I
come within the category of persons whose consent is required under Section 7 of
the Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ H. STEVEN WALTON
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE COMPANY'S FORM 10-Q FOR THE PERIOD ENDED MARCH 31, 1997 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 167,533
<DEPRECIATION> 2,175
<TOTAL-ASSETS> 3,610,380
<CURRENT-LIABILITIES> 4,921,645
<BONDS> 47,775
0
0
<COMMON> 3,347
<OTHER-SE> (1,362,387)
<TOTAL-LIABILITY-AND-EQUITY> 3,610,380
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 475,322
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
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