<PAGE>
As filed with the Securities and Exchange Commission on August 31, 1998
Registration No. 333-61987
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------
HORIZON PHARMACIES, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 75-2441557
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(State of Incorporation) (I.R.S. Employer Identification No.)
275 W. PRINCETON DRIVE
PRINCETON, TEXAS 75407
(972)736-2424
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(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
RICKY D. MCCORD, PRESIDENT
HORIZON PHARMACIES, INC.
275 W. PRINCETON DRIVE
PRINCETON, TEXAS 75407
(972)736-2424
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(Name, address, including zip code, and telephone number,
including area code, of agent for service)
COPIES TO:
DOUGLAS A. BRANCH, ESQ.
B. KAY CAREL, ESQ.
PHILLIPS MCFALL MCCAFFREY MCVAY & MURRAH, P.C.
12TH FLOOR, ONE LEADERSHIP SQUARE
211 N. ROBINSON
OKLAHOMA CITY, OKLAHOMA 73102
(405) 235-4100
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after this Registration Statement becomes effective.
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If the only securities being registered on 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 to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. / /
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, 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. / /
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.
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<PAGE>
SUBJECT TO COMPLETION DATED AUGUST 31, 1998
768,588 Shares
HORIZON PHARMACIES, INC.
[INSERT LOGO]
COMMON STOCK
------------
The shares (the "Shares") of common stock, par value $.01 per share (the
"Common Stock"), of HORIZON Pharmacies, Inc. (the "Company") offered hereby
(the "Offering") are being sold by certain selling shareholders (the "Selling
Shareholders"). See "Selling Shareholders." The Company will not receive
any of the proceeds from the sale of the Shares by the Selling Shareholders.
The costs, expenses and fees incurred in connection with the registration of
the Shares will be paid by the Company and are estimated to be approximately
$50,000.
------------
The Shares may be offered by the Selling Shareholders from time to time
in open market transactions (which may include block transactions), through
the writing of options on the Shares, or in private transactions at prices
relating to prevailing market prices or at negotiated prices. The Selling
Shareholders may effect such transactions by selling Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form
of discounts, concessions or commissions from the Selling Shareholders and/or
the purchasers of Shares for whom such broker-dealers may act as agent or to
whom they sell as principal or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions). The Selling
Shareholders and any broker-dealer acting in connection with the sale of the
Shares offered hereby may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"), in which
event any discounts, concessions or commissions received by them, which are
not expected to exceed those customary in the types of transactions involved,
or any profit on resales of the Shares by them, may be deemed to be
underwriting commissions or discounts under the Securities Act.
------------
The Common Stock is listed on the American Stock Exchange ("AMEX") under
the symbol "HZP". On August 14, 1998, the closing price of the Common Stock
as reported on the AMEX was $10.0625 per share.
------------
SEE "RISK FACTORS" FOR INFORMATION CONCERNING CERTAIN RISKS RELATED TO AN
INVESTMENT IN THE COMMON STOCK OFFERED HEREBY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
<TABLE>
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PRICE TO PROCEEDS TO
PUBLIC SELLING SHAREHOLDERS
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Per Share $ $
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Total $ $
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THE DATE OF THIS PROSPECTUS IS _______________, 1998.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information can be inspected and copied
at the public reference facilities maintained by the Commission at Room 1024,
450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at its
regional offices in New York (7 World Trade Center, Suite 1300, New York, New
York 10048) and 500 West Madison Street, Suite 1400 Northwestern Atrium
Center, Chicago, Illinois 60661. Copies of such material can also be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. The Commission
also maintains a 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.
In addition, the Common Stock is listed on the AMEX and reports and
other information concerning the Company can be inspected at the offices of
AMEX.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference into this Prospectus and to
be a part hereof the following reports and documents filed with the
Commission pursuant to the Exchange Act: (i) the Company's Form 10-KSB Annual
Report, for the year ended December 31, 1997; (ii) the Company's Quarterly
Reports on Form 10-QSB for the quarters ended March 31, 1998 and June 30,
1998; (iii) Current Reports on Form 8-K dated January 1, 1998, January 29,
1998, February 28, 1998, May 30, 1998, June 12, 1998, July 2, 1998, July 31,
1998, July 24, 1998 and August 6, 1998, which were filed on January 7, 1998,
February 12, 1998, March 13, 1998, June 15, 1998, June 25, 1998, August 4,
1998, August 6, 1998, August 7, 1998 and August 21, 1998 respectively, and
Form 8-K/A dated May 30, 1998 and filed August 14, 1998; and (iv) the
description of the Company's Common Stock contained in the Company's
Registration Statement on Form SB-2 (File No. 333-25257) declared effective
by the Commission on July 8, 1997.
All documents filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of the Offering shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from
the date of filing of such documents. 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
which also is incorporated or deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any and all of the documents that have been
or may be incorporated by reference in this Prospectus (other than exhibits
to such documents which are not specifically incorporated by reference into
such documents). Such requests should be directed to Ricky D. McCord,
President, HORIZON Pharmacies, Inc. (972)736-2424.
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<PAGE>
THE COMPANY
HORIZON Pharmacies, Inc. (the "Company") owns and operates one of the
top 100 retail pharmacy chains according to the April 27, 1998 issue of
CHAIN DRUG REVIEW and was ranked as one of the top 100 "hot growth" companies
by BUSINESS WEEK in its June 1, 1998 issue.
Currently, the Company's primary source of revenue is the sale of
prescription drugs. During 1997, sales of prescription drugs generated
approximately 76% of the Company's net revenues. The Company also sells and
leases home medical equipment ("HME") and offers home healthcare services
including, but not limited to, intravenous services and home oxygen therapy
under the name HORIZON Home Care. As of June 30, 1998, the Company had 33
stores located principally in the south central United States, and the
Company also operated nine HME operations, two home healthcare operations,
four pharmacies offering intravenous infusion services and home oxygen
therapy, four closed-door institutional pharmacies and one wholesale
pharmaceutical company. The Company expects to acquire at least 12 additional
pharmacies and four HME stores before the end of 1998 and 24 new pharmacies
and eight HME stores in 1999, and to have at least 70 pharmacies and offer
HME from at least 21 locations by the year 2000.
The Company's business strategy is to continue to expand through
acquisitions and to increase individual store profitability. In implementing
its business strategy, the Company intends to continue cost-control programs,
continue and improve employee training, negotiate increases in vendor
rebates, maintain a high level of customer service and convenience, increase
sales in each department in each store and maintain competitive pricing. To
mitigate the effect of third-party reimbursement on pharmaceutical sales, as
discussed below the Company also plans to expand its home healthcare,
non-pharmaceutical sales and services and wholesale pharmaceutical and
non-pharmaceutical sales.
The Company's principal office is located at 275 W. Princeton Drive,
Princeton, Texas 75407, and its telephone number is (972) 736-2424.
RISK FACTORS
In addition to the other information contained in this Prospectus or
incorporated by reference, prospective investors should carefully consider
the following risk factors relating to the Company and its Common Stock.
DEPENDENCE ON ACQUISITIONS FOR GROWTH. The Company has grown rapidly in
recent periods and intends to continue to pursue an aggressive growth
strategy. The Company's growth strategy depends upon its ability to continue
to acquire, consolidate and operate existing free-standing pharmacies and
related businesses on a profitable basis. The Company continually reviews
acquisition proposals and is currently engaged in discussions with third
parties with respect to possible acquisitions. The Company will compete for
acquisition candidates with buyers who have greater financial and other
resources than the Company and may be able to pay higher acquisition prices
than the Company. To the extent the Company is unable to acquire suitable
retail pharmacies, or to integrate such acquisitions successfully, its
ability to expand its business would be reduced significantly.
SALES TO THIRD-PARTY PAYORS. A growing percentage of the Company's
prescription drug volume has been accounted for by sales to customers who are
covered by third-party payment programs. Although contracts with third-party
payors may increase the volume of prescription sales and gross profits,
third-party payors typically negotiate lower prescription prices than those
of non third-party payors. Accordingly, there has been downward pressure on
gross profit margins on sales of prescription drugs which is expected to
continue in future periods.
RELIANCE ON MEDICARE AND MEDICAID REIMBURSEMENTS. Substantially all of
the Company's home healthcare revenues are attributable to third-party
payors, including Medicare and Medicaid, private insurers, managed care plans
and HMOs. The amounts received from government programs and private
third-party payors are dependent upon the specific benefits included under
the program or the patient's insurance policies. Like other medical service
providers, the Company is subject to lengthy reimbursement delays as a result
of third-party payment procedures. Any substantial delays in reimbursement
could adversely affect the Company's business, financial condition, cash
flows and results of operations. Accordingly, management of accounts
receivable through effective billing and reimbursement procedures is critical
to the Company's results of operations.
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<PAGE>
EXPANSION. The Company's expansion will require the implementation and
integration of enhanced operational and financial systems and additional
management, operational and financial resources. Failure to implement and
integrate these systems and add these resources could have a material adverse
effect on the Company's results of operations and financial condition. There
can be no assurance that the Company will be able to manage its expanding
operations effectively or that it will be able to maintain or accelerate its
growth.
GOVERNMENT REGULATION AND HEALTHCARE REFORM. The Company's pharmacists
and pharmacies are required to be licensed by the appropriate state boards of
pharmacy. The Company's pharmacies are also registered with the Federal Drug
Enforcement Administration. Under the Omnibus Budget Reconciliation Act of
1990, the Company's pharmacists are required to offer counseling to customers
covered by Medicaid about the medication, dosage, delivery system, common
side effects and other information deemed significant by the pharmacists.
The Company relies on prescription drug sales for a significant portion
of its revenues and profits, and prescription drug sales represent a
significant segment of the Company's business. These revenues are affected by
changes within the healthcare industry, including changes in programs
providing for reimbursement of the cost of prescription drugs by third-party
payment plans, such as government and private plans, and regulatory changes
relating to the approval process for prescription drugs. In recent years a
number of healthcare reform proposals have been introduced or proposed by
Congress and in some state legislatures that would effect major changes in
the healthcare system, either nationally or at the state level. The proposals
ranged from the Clinton Administration's comprehensive healthcare reform
proposal that would have restructured the financing and delivery of
healthcare services through a combination of managed competition and mandated
employer coverage of employees to less comprehensive proposals that would
have required private health insurance to be "portable" and eliminated
coverage limitations for pre-existing health conditions. No proposal was
adopted by either house of Congress. The Company anticipates that additional
healthcare reform proposals may continue to be introduced by Congress. It is
difficult to predict whether any proposal will be adopted or the effect on
the Company of any proposal that does become law. A number of states in
which the Company has operations have either adopted or are considering
healthcare reform proposals at the state level. These state reform laws
have, in many cases, not been fully implemented.
REGULATION OF HOME HEALTHCARE SERVICES. The Company's home healthcare
business is subject to extensive Federal and state regulation. Federal
regulation covers, among other things, Medicare and Medicaid billing and
reimbursement, reporting requirements, certification standards for certain
home health agencies and other types of healthcare providers, limitations on
ownership and other financial relationships between a provider and its
referral sources and approval by the Food and Drug Administration ("FDA") of
the safety and efficacy of pharmaceuticals and medical devices. In addition,
the requirements that the Company must satisfy to conduct its businesses vary
from state to state. The Company believes that its operations comply with
applicable Federal and state laws and regulations in all material respects.
However, changes in the law or new interpretations of existing laws can have
a material effect on permissible activities of the Company, the relative
costs associated with doing business and the amount of reimbursement for the
Company's products and services paid by government and other third-party
payors.
Certain of the Company's facilities are subject to state licensure laws.
Federal laws require certain of the Company's facilities to comply with rules
applicable to controlled substances. These rules include an obligation to
register with the Drug Enforcement Administration of the United States
Department of Justice and to meet certain requirements concerning security,
record keeping, inventory controls, prescription and order forms and
labeling. The Company's pharmacists, nurses, and certain of its radiology
equipment also are subject to state licensing requirements. The Company
believes that it is in compliance with all applicable licensure requirements.
MALPRACTICE LIABILITY. The provision of home healthcare services
entails an inherent risk of claims of medical and professional malpractice
liability. The Company may be named as a defendant in such malpractice
lawsuits, and is subject to the attendant risk of substantial damage awards.
While the Company believes it has adequate professional and medical
malpractice liability insurance coverage, there can be no assurance that a
future claim or claims will not be successful or if successful will not
exceed the limits of available insurance coverage or that such coverage will
continue to be available at acceptable costs and on favorable terms.
COMPETITION. The Company's business is highly competitive. In each of
its markets, the Company competes with national retail pharmacy chains,
regional retail pharmacy chains,
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<PAGE>
local retail pharmacy chains, independent retail pharmacies, deep discount
retail pharmacies, supermarkets, discount department stores, mass
merchandisers and other retail stores and mail order operations. Most of
these competitors have financial resources that are substantially greater
than those of the Company. Competition among retail pharmacies generally
takes the form of price competition, store location, product selection and
customer service.
The market for home healthcare services is also highly competitive.
Many of the Company's existing and potential competitors have substantially
greater financial, marketing and personnel resources than the Company and
have established generally greater name recognition in the home healthcare
industry. Most of the Company's competitors also offer more extensive home
healthcare services than the Company. There can be no assurance the Company
will be able to successfully compete with its competitors in the home
healthcare industry.
SUBSTANTIAL INDEBTEDNESS. In connection with the Company's acquisition
of retail pharmacies, the Company has incurred substantial debt. The
Company's ability to make cash payments to satisfy the debt will depend upon
its future operating performance, which is subject to a number of factors
including prevailing economic conditions and financial, business and other
factors beyond the Company's control. Based on the Company's ability to
generate cash flow from operating activities, management believes that the
Company will have the funds necessary to meet the principal and interest
payments on its debt as they become due and to operate and expand its
business. However, there can be no assurance that the Company will be able
to do so. If the Company is unable to generate sufficient earnings and cash
flow to meet its obligations with respect to its outstanding indebtedness,
refinancing of certain of these debt obligations or disposition of certain
assets may be required. In the event debt refinancing is required, there can
be no assurance that the Company can effect such refinancing on satisfactory
terms.
RELIANCE ON SINGLE SUPPLIER. The Company has contracted to purchase a
substantial portion of its pharmaceutical and non-pharmaceutical inventory
from McKesson Corporation ("McKesson"). McKesson also provides the Company
with order entry machines, shelf labels and other supplies used in connection
with the Company's purchase and sale of such inventory. Although the Company
believes that, because of the consolidation of the retail pharmacy industry
and the practice of certain large retail pharmacy chains to purchase directly
from product manufacturers, the Company could obtain its inventory through
another similar distributor at competitive prices and upon competitive
payment terms in the event its relationship with McKesson was terminated,
such a conversion could involve delays or interruptions in supply which could
have an adverse impact on the Company's financial performance.
DEPENDENCE ON KEY PERSONNEL. The Company's future success will be
highly dependent on the continued efforts of Ricky D. McCord, R.Ph.,
President and Chief Operating Officer, and Sy S. Shahid, Executive Vice
President. The Company has employment agreements with Messrs. McCord and
Shahid, and owns key man life insurance policies on each such individual.
Notwithstanding the foregoing, the loss of the services of one or both of
such key personnel could have a material adverse effect upon the Company's
results of operations.
The Company's success is also dependent upon its ability to attract and
retain experienced retail managers, pharmacists, and employees skilled in
home healthcare services, and the ability of the Company's personnel to
manage the Company's growth and integrate its operations. There can be no
assurance that the Company will be successful in attracting and retaining
such personnel.
POTENTIAL FLUCTUATIONS IN QUARTERLY RESULTS; SEASONALITY. The Company
expects to experience fluctuations in future quarterly operating results that
may be caused by many factors, including the number and timing of store
acquisitions, additional and existing competition, marketing programs,
weather, special or unusual events and national, regional and local economic
conditions that may affect retailers in general. Any concentration of
acquisitions near the end of a quarter could have an adverse effect on the
financial results for that quarter and could, in certain circumstances, lead
to fluctuations in quarterly financial results. Furthermore, the retail
pharmacy business is somewhat seasonal, with the highest net sales and net
income levels historically occurring during the fourth and following first
quarters of each year (which include the holiday selling season). The
Company's results of operations depend significantly upon the net revenues
generated during the first and fourth quarters, and any decrease in net
revenues for such periods could have a material adverse effect upon the
Company's profitability. As a result, the Company believes that
period-to-period comparisons of its results of operations are not and will
not necessarily be meaningful, and should not be relied upon as an indication
of future performance.
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POSSIBLE ISSUANCES OF PREFERRED STOCK. The Company's Certificate of
Incorporation authorizes the Board of Directors, without shareholder
approval, to issue up to 1,000,000 shares of preferred stock, $.01 per share
par value (the "Preferred Stock"). The number of shares of each series and
the designations, powers, preferences, qualifications, limitations or
restrictions of each series shall be determined by the Board of Directors.
The possible effects of such issuances include the grant of voting rights to
holders of Preferred Stock superior to that of the holders of Common Stock,
the grant of preferences in the payment of dividends and upon liquidation of
the Company in favor of the holders of Preferred Stock, and the conferral of
conversion rights which entitle the holders of Preferred Stock to convert
their shares into Common Stock, thereby resulting in possible future dilution
to the holders of Common Stock. The issuance of the Preferred Stock could
have the effect of delaying or preventing a change in control of the Company.
ANTI-TAKEOVER PROVISIONS. Certain provisions of the Delaware
Corporation Law may delay, discourage or prevent a change in control of the
Company. Such provisions may discourage bids for the Common Stock at a
premium over the market price of the Common Stock and may adversely affect
the market price and the voting and other rights of the holders of Common
Stock. In addition, the Board of Directors has the authority without action
by the Company's shareholders to fix the rights, privileges and preferences
of and to issue shares of the Company's Preferred Stock which may have the
effect of delaying, deterring or preventing a change in control of the
Company.
In addition to the authorization of Preferred Stock, the Company's
Certificate of Incorporation and Bylaws include several other provisions
which may have the effect of inhibiting a change of control of the Company.
These include the division of the Board of Directors into three classes
serving staggered three year terms which could delay or prevent shareholders
from effecting a change of control of the Company, no shareholder action by
written consent and advance notice requirements for shareholder proposals and
director nominations. The provisions may discourage a party from making a
tender offer for or otherwise attempting to obtain control of the Company.
The Board of Directors does not currently have any plans, arrangements,
commitments or understandings to issue any Preferred Stock.
POSSIBLE VOLATILITY OF STOCK PRICE. The trading price of the Company's
Common Stock could be subject to fluctuations in response to quarterly
variations in results of operations, announcements of new services or
products by the Company or its competitors, changes in financial estimates by
securities analysts and other events or factors. At various times, the
stock market has experienced volatility that has particularly affected the
market prices for stock of particular industry groups, such as
retail-oriented companies, often without regard to a particular company's
operating results.
DIVIDEND POLICY. The Company does not anticipate paying any cash
dividends on the Common Stock in the foreseeable future.
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USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares
offered hereby.
SELLING SHAREHOLDERS
The following table sets forth the shares of Common Stock owned by each
of the Selling Shareholders before and after the Offering (assuming all
Shares offered hereby are sold) and the amount of Shares offered. The
Selling Shareholders have no obligation to sell the Shares offered hereby.
None of the Selling Stockholders has any relationship to the Company.
<TABLE>
SHARES OWNED SHARES OWNED
PRIOR TO THE OFFERING AFTER THE OFFERING
----------------------- SHARES BEING -------------------
NAME AND ADDRESS NUMBER PERCENT OFFERED NUMBER PERCENT
---------------- ------ ------- ------------ ------ -------
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LaSalle St. Capital Markets, Inc. 6,000 * 6,000 -0- --
Donald A. Pape 12,900(1) * 6,450 6,450 *
Darren VonBehren 15,000 * 15,000 -0- --
John E. Adams 5,300 * 4,300 1,000 *
Quantum Partners LDC 206,300(2) 3.9% 206,300 -0- --
White Rock Capital Partners, L.P. 124,500(2)(3) 2.3% 117,900 -0- --
White Rock Capital Offshore, Ltd. 184,300(2) 3.4% 184,300 -0- --
Caxton International Limited 114,000(2) 2.1% 114,000 -0- --
Legion Strategies Limited 81,200(2) 1.5% 81,200 -0- --
White Rock Capital Management, L.P. (#10) 11,138(2) * 11,138 -0- --
Collins Capital Diversified Fund, L.P. 22,000(2) * 22,000 -0- --
</TABLE>
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* Indicates less than 1% of outstanding Common Stock.
(1) Includes 6,450 shares of Common Stock covered by currently exercisable
warrants.
(2) Such shares may be deemed beneficially owned in whole or in part by (i)
White Rock, Inc., a Texas corporation ("WRI"), whose sole shareholders are
Thomas U. Barton and Joseph U. Barton; (ii) White Rock Management, a Texas
limited partnership ("WRM"), whose general partner is WRI; (iii) Thomas U.
Barton; and (iv) Joseph U. Barton.
(3) White Rock Capital Partners, L.P. disclaims beneficial ownership of any
shares of Common Stock held for the account of clients of WRI or WRM.
PLAN OF DISTRIBUTION
The Shares may be offered by the Selling Shareholders from time to time
in open market transactions (which may include block transactions), through
the writing of options on the Shares, or in private transactions at prices
relating to prevailing market prices or at negotiated prices. The Selling
Shareholders may effect such transactions by selling Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form
of discounts, concessions or commissions from the Selling Shareholders
and/or the purchasers of Shares for whom such broker-dealers may act as agent
or to whom they sell as principal or both (which compensation as to a
particular broker-dealer might be in excess of customary commissions). The
Selling Shareholders and any broker-dealer acting in connection with the sale
of the Shares offered hereby may be deemed to be "underwriters" within the
meaning of the Securities Act in which event any discounts, concessions or
commissions received by them, which are not expected to exceed those
customary in the types of transactions involved, or any profit on resales of
the Shares by them, may be deemed to be underwriting commissions or discounts
under the Securities Act.
The Shares offered hereby may be sold from time to time in one or more
transactions at a fixed offering price, which may be changed, or at varying
prices determined at the time of sale, or at negotiated prices.
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The costs, expenses and fees incurred in connection with the
registration of the Shares will be paid by the Company.
The Company has agreed to indemnify the Selling Shareholders against
certain liabilities under the Act.
To comply with certain states' securities laws, if applicable, the
Shares will be sold in such jurisdictions only through registered or licensed
brokers or dealers. In addition, in certain states the Shares may not be
sold unless such Shares have been registered or qualified for sale in such
state or an exemption from registration or qualification is available and is
complied with.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Phillips McFall McCaffrey McVay & Murrah, P.C. ("Phillips
McFall"), Oklahoma City, Oklahoma. Donald A. Pape, one of the Selling
Shareholders, serves Of Counsel to Phillips McFall.
EXPERTS
The consolidated financial statements of HORIZON Pharmacies, Inc.
appearing in the Company's 1997 Annual Report Form 10-KSB for the year ended
December 31, 1997 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
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No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained in this Prospectus
and, if given or made, such information or representation must not be relied
upon as having been authorized by the Company or the Selling Shareholders.
This Prospectus does not constitute an offer to sell or solicitation of an
offer to buy any securities offered hereby in any jurisdiction to any person
to whom it is unlawful to make such offer in such jurisdiction. Neither the
delivery of this Prospectus nor any sale made hereunder shall, under any
circumstances, create any implication that the information herein is correct
as of any time subsequent to the date hereof or that there has been no change
in the affairs of the Company since such date.
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<S> <C>
Available Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents by Reference. . . . . . . . . . . . . . . 2
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Selling Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
</TABLE>
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768,588 Shares
HORIZON PHARMACIES, INC.
[logo]
COMMON STOCK
-----------------------------
PROSPECTUS
-----------------------------
HORIZON PHARMACIES, INC.
275 W. PRINCETON DRIVE
PRINCETON, TEXAS 75407
(972)736-2424
____________, 1998
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses of the Offering, all of which are to be paid by
the Company, are as follows:
<TABLE>
<S> <C>
Registration Fees:
Securities and Exchange Commission.............. $ 2,356
American Stock Exchange......................... 16,000
Printing and engraving expenses...................... 1,000
Legal fees and expenses.............................. 15,000
Accountants' fees and expenses....................... 10,000
Miscellaneous........................................ 5,644
-------
Total...................................... $50,000
-------
-------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The General Corporation Law of the State of Delaware grants every
corporation the power to 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
attorneys' fees, judgments, 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 Delaware statute also grants every corporation the power to
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 of the corporation as a
director, officer, employee, or agent of another corporation, partnership,
joint venture, trust, or other enterprise against expenses, including
attorneys' 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 believe to be in or not opposed to the best
interests of the corporation, 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 for negligence or misconduct in the performance of
his duty to the corporation unless and only to the extent that 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 shall deem proper.
The Delaware statute 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 the statute, or in defense of any claim, issue, or matter therein, he
shall be indemnified against expenses, including attorneys' fees, actually
incurred by him in connection therewith.
Article VI of the Registrant's Bylaws provides that the Registrant shall
indemnify to the full extent permitted under the General Corporation Law of
the State of Delaware any director, officer, employee, or agent of the
Registrant.
II-1
<PAGE>
Article IX of the Registrant's Certificate of Incorporation exculpates
the directors of the Registrant from and against certain liabilities.
Article IX provides that a director of the Registrant shall have no personal
liability to the Registrant or its shareholders for monetary damages for
breach of fiduciary duty as a director, except for liability (a) for any
breach of the director's duty of loyalty to the Registrant or its
shareholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) for acts or
omissions specified in Section 174 of the General Corporation Law of the
State of Delaware regarding the unlawful payment of dividends and the
unlawful purchase or redemption of the Registrant's stock, and (d) for any
transaction from which the director derived an improper personal benefit.
The Registrant has liability insurance for each director and officer for
certain losses arising from claims or charges made against them while acting
in their capacities as directors or officers of the Registrant.
ITEM 16. EXHIBITS.
<TABLE>
EXHIBIT DESCRIPTION
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<S> <C> <C>
* 4.1 --- Specimen Certificate for Common Stock of registrant
* 4.2 --- Form of Warrant
* 5.1 --- Opinion of Phillips McFall McCaffrey McVay & Murrah, P.C.
23.1 --- Consent of Phillips McFall McCaffrey McVay & Murrah,
P.C.
23.2 --- Consent of Ernst & Young LLP
*24.1 --- Powers of Attorney
</TABLE>
- -------------
*Previously filed.
ITEM 17. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions described under Item 15, above,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange 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 against the Registrant
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 of 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.
The undersigned Registrant hereby undertakes to:
(1) File, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) Include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) 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 together, represent a
fundamental change in the information in the Registration
Statement; and
II-2
<PAGE>
(iii) Include any additional or changed material information
on the plan of distribution;
PROVIDED, HOWEVER, that (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
registration statement.
(2) For determining liability under the Securities Act of 1933,
treat each post-effective amendment as a new registration statement
of the securities offered, and the offering of the securities at that
time shall be the initial bona fide offering.
(3) File a post-effective amendment to remove from registration
any of the securities which remain unsold at the end of the offering.
(4) For determining any liability under the Securities Act of
1933, treat each post-effective amendment that contains a form of
prospectus as a new registration statement for the securities offered
in the registration statement, and that offering of the securities at
that time as the initial bona fide offering of those securities.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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
Amendment No. 1 to the Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Princeton, State
of Texas, on August 31, 1998.
HORIZON PHARMACIES, INC.
By: /s/ Ricky D. McCord
-------------------------------------
Ricky D. McCord
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT AND CHIEF OPERATING OFFICER
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the date indicated.
SIGNATURE TITLE DATE
/s/ Ricky D. McCord Chairman of the Board August 31, 1998
- ----------------------------------- of Directors;
Ricky D. McCord, President; Chief
PRINCIPAL EXECUTIVE OFFICER Operating Officer
/s/ John N. Stogner Chief Financial August 31, 1998
- ----------------------------------- Officer; Treasurer
John N. Stogner
PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER
*/s/ Sy S. Shahid Executive Vice August 31, 1998
- ----------------------------------- President; Secretary;
Sy S. Shahid Director
*/s/ Charlie K. Herr Director August 31, 1998
- -----------------------------------
Charlie K. Herr
*/s/ Michael F. Loy Director August 31, 1998
- -----------------------------------
Michael F. Loy
*/s/ Robert D. Mueller Director August 31, 1998
- -----------------------------------
Robert D. Mueller
*/s/ Philip H. Yeilding Director August 31, 1998
- -----------------------------------
Philip H. Yeilding
*By: /s/ Ricky D. McCord
- -----------------------------------
Ricky D. McCord
Attorney-in-Fact
II-4
<PAGE>
Exhibit 23.1
CONSENT OF COUNSEL
Phillips McFall McCaffrey McVay & Murrah, P.C., hereby consents to the
filing of its opinion of counsel as an exhibit to the Form S-3 Registration
Statement of HORIZON Pharmacies, Inc. ("HORIZON") for the registration of
768,588 shares of HORIZON common stock, par value $.01 per share.
/s/ Phillips McFall McCaffrey McVay & Murrah, P.C.
PHILLIPS MCFALL MCCAFFREY MCVAY & MURRAH, P.C.
Oklahoma City, Oklahoma
August 31, 1998
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement Form S-3 No. 333-61987 and
related Prospectus of HORIZON Pharmacies, Inc. for the registration of
768,588 shares of its common stock and to the incorporation by reference
therein of our report dated March 16, 1998, with respect to the consolidated
financial statements of HORIZON Pharmacies, Inc. included in its Annual
Report Form 10-KSB for the year ended December 31, 1997, filed with the
Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Oklahoma City, Oklahoma
August 28, 1998
