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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 000-26537
ALLSCRIPTS, INC.
(Exact name of registrant as specified in its charter)
Delaware 36-3444974
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2401 Commerce Drive
Libertyville, Illinois 60048
(Address of principal executive offices)
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(847) 680-3515
(Registrant's telephone number, including area code)
----------------------
Indicate by check ( X ) whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No _______
__________
As of April 30, 2000, there were 26,513,324 shares of the Registrant's
$0.01 par value common stock outstanding.
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<TABLE>
<CAPTION>
ALLSCRIPTS, INC.
FORM 10-Q
INDEX
PART I. FINANCIAL INFORMATION PAGE
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<S> <C> <C>
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
At December 31, 1999 and March 31, 2000 1
Condensed Consolidated Statements of Operations
For the three months ended March 31, 1999 and 2000 2
Condensed Consolidated Statements of Cash Flows
For the three months ended March 31, 1999 and 2000 3
Notes to Condensed Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Item 3. Quantitative and Qualitative Disclosures About Market Risk 11
PART II. OTHER INFORMATION
Item 2. Changes in Securities 12
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
</TABLE>
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PART I FINANCIAL INFORMATION
Item 1. Financial Statements.
ALLSCRIPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
<TABLE>
<CAPTION>
December 31, March 31,
1999 2000
---- ----
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 40,561 $ 110,478
Marketable securities 15,049 31,886
Accounts receivable, net of allowances of $3,743 in 1999 and
$3,442 in 2000 5,126 6,750
Interest receivable 340 780
Other receivable - 4,160
Inventories 3,585 3,938
Prepaid expenses and other current assets 786 860
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Total current assets 65,447 158,852
Long-term marketable securities - 14,219
Fixed assets, net 4,940 6,193
Intangible assets, net 3,575 3,007
Other assets 52 1,041
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Total assets $ 74,014 $ 183,312
============= =============
LIABILITIES
Current liabilities:
Accounts payable $ 4,352 $ 4,101
Accrued expenses 1,664 1,789
Deferred revenue 575 774
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Total current liabilities 6,591 6,664
Long-term debt 59 -
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Total liabilities 6,650 6,664
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STOCKHOLDERS' EQUITY
Preferred shares:
Undesignated, $0.01 par value, 1,000,000 shares authorized, no shares issued and - -
outstanding at December 31, 1999 and March 31, 2000
Common shares:
$0.01 par value, 75,000,000 shares authorized, 24,221,537 shares issued,
24,187,072 shares outstanding at December 31, 1999; 75,000,000 shares
authorized, 26,246,603 shares issued, 26,212,138 shares outstanding at
March 31, 2000 242 263
Unearned compensation (1,632) (1,491)
Additional paid-in capital 130,830 241,995
Treasury stock at cost; 34,465 common shares at December 31, 1999 and
March 31, 2000 (68) (68)
Accumulated deficit (62,008) (64,051)
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Total stockholders' equity 67,364 176,648
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Total liabilities and stockholders' equity $ 74,014 $ 183,312
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</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
1
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ALLSCRIPTS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months
Ended
March 31,
-----------------------------
1999 2000
---- ----
(Unaudited)
<S> <C> <C>
Revenue $ 6,028 $ 9,647
Cost of revenue 4,565 7,597
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Gross profit 1,463 2,050
Selling, general and administrative expenses 3,550 8,945
Amortization of intangibles 93 574
---------- ----------
Loss from operations (2,180) (7,469)
Interest income (expense), net (109) 1,183
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Loss from continuing operations (2,289) (6,286)
Income from discontinued operations 26 83
Gain from sale of discontinued operations 3,547 4,160
---------- ----------
Net income (loss) 1,284 (2,043)
Accretion of mandatory redemption value of
preferred shares and accrued dividends on preferred shares (699) -
---------- ----------
Net income (loss) attributable to common stockholders $ 585 $ (2,043)
========== ==========
Per share data-basic and diluted:
Continuing operations (including accretion and accrued
dividends on preferred shares) $ (0.35) $ (0.25)
Discontinued operations 0.42 0.17
---------- ----------
Net income (loss) attributable to common stockholders $ 0.07 $ (0.08)
========== ==========
Weighted average shares of common stock outstanding
used in computing per share data-basic and diluted 8,472 24,933
========== ==========
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
2
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ALLSCRIPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-----------------------------------
1999 2000
----------------- ----------------
(Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 1,284 $ (2,043)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization 407 1,067
Gain on sale of discontinued operations (3,547) (4,160)
Non-cash compensation expense-employees 130 141
Non-cash expense-non-employees - 742
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable, net 135 (1,624)
Increase in interest receivable - (440)
Increase in inventories (180) (353)
(Increase) decrease in prepaid expenses and other assets 17 (69)
(Decrease) increase in accounts payable 736 (251)
Decrease (increase) in accrued and other current liabilities (315) 324
----------------- ----------------
Net cash used in operating activities (1,333) (6,666)
----------------- ----------------
Cash flows from investing activities:
Capital expenditures (274) (1,746)
Purchases of marketable securities - (41,056)
Maturities of marketable securities - 10,000
Proceeds from sale of discontinued operations 7,473 -
Purchase of investment - (1,000)
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Net cash (used in) generated from investing activities 7,199 (33,802)
----------------- ----------------
Cash flows from financing activities:
Proceeds from exercise of common stock options 39 510
Proceeds from public offering - 99,934
Cash received from sale of common stock - 10,000
Borrowings under line of credit 1,400 -
Payments on long-term debt - (59)
----------------- ----------------
Net cash provided by financing activities 1,439 110,385
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Net increase in cash and cash equivalents 7,305 69,917
Cash and cash equivalents, beginning of period 718 40,561
----------------- ----------------
Cash and cash equivalents, end of period $ 8,023 $ 110,478
----------------- ----------------
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
3
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ALLSCRIPTS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The quarterly financial information presented herein should be read in
conjunction with Allscripts' audited financial statements and the accompanying
notes included in our Annual Report on Form 10-K. The unaudited interim
condensed financial statements have been prepared on a basis consistent with
those financial statements and reflect all adjustments (all of which are of a
normal recurring nature, except those related to discontinued operations) that
are, in the opinion of management, necessary for a fair presentation of the
results for the interim periods. The consolidated financial statements include
the accounts of Allscripts, Inc. and its wholly owned subsidiaries (collectively
referred to as "Allscripts"). All significant intercompany accounts and
transactions have been eliminated in consolidation. The results for the interim
periods are not necessarily indicative of the results to be expected for the
year.
2. Recently Issued Accounting Standards
In December 1999, the U.S. Securities and Exchange Commission ("SEC")
issued Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial
Statements"("SAB 101"), which provides the SEC's views in applying generally
accepted principles to selected revenue recognition issues. Adoption of SAB 101
is required in the second quarter of fiscal year 2000. The Company does not
expect SAB 101 to have a material impact on the Company's consolidated results
of operations or financial position.
3. Public Offering
On March 10, 2000, Allscripts completed a public offering of 1,452,000
shares of its common stock, at an offering price of $73 per share. The public
offering resulted in gross proceeds of $105,996,000, $5,561,000 of which was
applied to the underwriting discount and approximately $501,000 of which was
applied to related offering expenses. The remaining net proceeds of
approximately $99,934,000 were invested in interest-bearing, investment-grade
securities.
4. Net Income (Loss) Per Share
Allscripts accounts for net income (loss) per share in accordance with SFAS
No. 128, "Earnings per Share." SFAS No. 128 requires the presentation of "basic"
earnings per share and "diluted" earnings per share. Basic earnings per share is
computed by dividing the net income (loss) attributable to common stockholders
by the weighted average shares of outstanding common stock. For purposes of
calculating diluted earnings per share, the denominator includes both the
weighted average shares of common stock outstanding and dilutive potential
common stock.
In accordance with SFAS No. 128, basic and diluted net loss per share has
been computed using the weighted average number of shares of common stock
outstanding during the period. Allscripts has excluded the impact of all
outstanding warrants and options to purchase shares of common stock, all
outstanding convertible preferred shares on an if converted basis and contingent
share payment obligations from the calculation of diluted loss per share because
all such securities are antidilutive for all periods presented. Antidilutive
potential common stock excluded from the diluted
4
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earnings per share computation for the three months ended March 31, 2000 and
1999 were 2,867,125 and 10,330,334 shares, respectively.
5. Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalent balances consist of cash and highly liquid
corporate debt securities with maturities at the time of purchase of less than
90 days. Marketable securities include corporate debt instruments with
maturities of greater than 90 days at the time of purchase.
Current marketable securities include those with maturities of less than
one year at the balance sheet date, while long term marketable securities have
maturities of greater than one year at the balance sheet date.
6. Other Receivable
The other receivable at March 31, 2000 represents contingent consideration
related to the sale of the Allscripts pharmacy benefit management business in
March of 1999 (see Note 9).
7. Sale of Common Stock
During February of 2000, Allscripts sold IMS Health Incorporated 214,794
shares of Allscripts common stock for a purchase price of $10,000,000.
8. Contingencies
The pharmaceutical repackaging industry is subject to stringent federal and
state regulations. Allscripts' repackaging operations are regulated by the Food
and Drug Administration as if Allscripts were a manufacturer. Allscripts is also
subject to regulation by the Drug Enforcement Agency in connection with the
packaging and distribution of controlled substances.
Allscripts is a defendant in numerous multi-defendant lawsuits involving
the manufacture and sale of dexfenfluramine, fenfluramine and phentermine. The
plaintiffs in these cases claim injury as a result of ingesting a combination of
these weight-loss drugs. These suits have been filed in various jurisdictions
throughout the United States, and in each of these suits, Allscripts is one of
many defendants, including manufacturers and other distributors of these drugs.
Allscripts does not believe it has any significant liability incident to the
distribution or repackaging of these drugs, and it has tendered defense of these
lawsuits to its insurance carrier for handling. The lawsuits are in various
stages of litigation, and it is too early to determine what, if any, liability
Allscripts will have with respect to the claims made in these lawsuits. If
Allscripts' insurance coverage in the amount of $16,000,000 per occurrence and
$17,000,000 per year in the aggregate is inadequate to satisfy any resulting
liability, Allscripts will have to defend these lawsuits and be responsible for
the damages, if any, that Allscripts suffers as a result of these lawsuits.
Allscripts does not believe that the outcome of these lawsuits will have a
material adverse effect on its financial condition, results of operations or
cash flows.
5
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9. Discontinued Operations
In March 1999, Allscripts sold substantially all of the assets, excluding
cash and accounts receivable, of its pharmacy benefit management business. The
operating results of the pharmacy benefit management business have been
segregated from continuing operations and reported as a separate line item on
the Condensed Consolidated Statements of Operations under the caption "Income
from discontinued operations."
Operating results from discontinued operations were as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------------
<S> <C> <C>
1999 2000
------------ ------------
(In thousands)
(Unaudited)
Revenue $ 14,292 $ -
Cost of revenue 13,378 -
------------ ------------
Gross profit 914 -
Selling, general and administrative expenses 762 (83)
Amortization of intangibles 126 -
------------ ------------
Operating income 26 83
------------ ------------
Income from discontinued operations $ 26 $ 83
============ =============
</TABLE>
Included in revenue for the first three months of 1999 is $375,000 from
Anthem, Inc., a related party.
In the first quarter of 1999 and 2000, Allscripts recognized a gain on the
sale of this business of $3,547,000 and $4,160,000, respectively, which has also
been reported as a separate line item on the Condensed Consolidated Statements
of Operations under the caption "Gain on sale of discontinued operations." The
gain in the first quarter of 2000 represents contingent consideration related to
the sale based upon certain pre-defined metrics which were achieved in March
2000. The contingent consideration was received by Allscripts in May of 2000.
10. Acquisitions
On March 13, 2000, Allscripts entered into a definitive agreement to
acquire MasterChart, Inc., a software developer providing dictation, integration
and patient record technology. In exchange for all the outstanding shares of
MasterChart, Allscripts issued 1,617,889 shares of common stock and $5,000,000
in cash. This acquisition, which will be accounted for as a purchase, closed on
May 9, 2000 and will be recorded in the second quarter of 2000.
On April 12, 2000, Allscripts entered into a definitive agreement to
acquire Medifor, Inc., a provider of Internet delivered patient education. In
exchange for all the outstanding shares of Medifor, Allscripts will issue up to
936,000 shares of common stock. This acquisition, which will be accounted for as
a purchase, is expected to close in the second quarter of 2000.
6
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11. Subsequent Events
At the May 10 stockholders meeting, the stockholders approved an increase
in shares of authorized common stock from 75,000,000 to 150,000,000 and an
increase in shares of common stock reserved for issuance under its Amended and
Restated 1993 Stock Incentive Plan by 3,000,000 to 7,393,489.
7
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Overview
We provide physicians with Internet and client/server medication management
solutions designed to improve the quality and cost effectiveness of
pharmaceutical healthcare. We currently derive our revenue from the sale of
prepackaged medications, software licenses, computer hardware and related
services.
Our shift in focus to physicians who require technology-based services to
operate successfully in a managed care environment and away from physicians with
a high percentage of fee-for-service patients is reflected in the composition of
our revenue, as depicted in the following table:
<TABLE>
<CAPTION>
Quarter Ended
------------------------------------------------------------------------
1999 2000
------------------------------------------------------------------------
(Unaudited)
------------------------------------------------------------------------
March 31, June 30, Sept. 30, Dec. 31, March 31,
------------ ------------ ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C>
Traditional revenue.......... $5,235 $4,537 $4,035 $4,085 $4,443
E-commerce revenue........... 793 1,855 2,940 4,106 5,204
------------ ------------ ------------ ------------ ------------
Total revenue......... $6,028 $6,392 $6,975 $8,191 $9,647
============ ============ ============ ============ ============
</TABLE>
Traditional revenue includes all non-e-commerce revenue and is derived from
the sale, through non-Internet channels, of prescription medications and other
medical products to physicians who do not use our software. We expect
traditional revenue to represent a decreasing percentage of total revenue in the
future. E-commerce revenue is derived primarily from the sale of prescription
medications over the Internet to physicians who use our software or who order
products from us primarily over the Internet. E-commerce revenue also includes
revenue for software subscriptions, computer hardware sales and leases and
e-detailing. For the three months ended March 31, 2000, sales of prepackaged
medications represented 82.5% of e-commerce revenue. For the three months ended
March 31, 2000, 26.5% of e-commerce revenue represented medication sales over
the Internet without the use of TouchScript ordering. While we expect a portion
of future e-commerce revenue to continue to represent a shifting of traditional
revenue, we anticipate that most of the future growth in e-commerce revenue will
be generated by physician practice groups that are not currently our customers.
Factors that we expect will attract future customers include an interest in
physician dispensing, a desire to minimize financial risk imposed by managed
care payers with respect to medications that they prescribe and concern about
the potential liability associated with medication errors.
We believe that managed care prescription programs will continue to cover
an increasing percentage of patients in the foreseeable future. This trend will
have the effect of reducing the dispensing opportunities of our traditional
dispensing customers because of their inability to submit claims electronically
for reimbursement by managed care payers. This reduction in dispensing
opportunities will reduce the revenue that we have historically recognized from
these customers. Additionally, managed care programs impose reduced
reimbursement rates for the medications dispensed to their plan participants,
thus providing us with a dollar margin per prescription dispensed that is lower
than we have historically experienced. Because TouchScript enables physicians to
submit claims electronically for reimbursement by managed care payers, a large
portion of the medications dispensed by our TouchScript customers is dispensed
to managed care patients. Accordingly, we expect that the fastest growing
portion of our business will provide margins with respect to the sale of
prepackaged medications that are lower than we have historically experienced.
8
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To maintain our position in a rapidly changing and increasingly
competitive marketplace, we expect to continue to increase the number of our
sales, sales support, product development and customer service personnel
significantly, and, accordingly, we expect our operating expenses to continue to
increase at an accelerated pace. In addition, we expect to amortize unearned
compensation expense of approximately $1,491,000 through December 31, 2003. In
connection with our acquisition of MasterChart, we expect to record goodwill and
other intangible assets of approximately $130,000,000, which we expect to
amortize to expense over three years, which is the estimated economic life of
these intangible assets. We also expect to record substantial additional amounts
of goodwill and other intangible assets in connection with our pending
acquisition of Medifor, Inc., which we expect to close in the second quarter of
2000.
Three Months Ended March 31, 2000 Compared to Three Months Ended March 31, 1999
Total revenue for the three months ended March 31, 2000 increased by
60.0% or $3,619,000 from $6,028,000 in 1999 to $9,647,000 in 2000. E-commerce
revenue increased by 556.2% or $4,411,000 from $793,000 in the first quarter of
1999 to $5,204,000 in the first quarter of 2000. Traditional revenue for the
three months ended March 31, 2000 decreased by 15.1% or $792,000 from $5,235,000
in 1999 to $4,443,000 in 2000.
The increase in e-commerce revenue reflects increased installations and
utilization of TouchScript, a conversion of traditional revenue as a result of
traditional customers ordering products over the Internet, revenue generated
from our e-detailing product, and an increase in the dispensing percentage of
brand drugs, which have a higher average selling price than their generic
counterparts. The decrease in traditional revenue reflects a conversion of
traditional revenue to e-commerce, as outlined above, as well as reduced sales
of pre-packaged medications to our traditional sites, offset partially by
general price inflation of brand medications, an increase in the dispensing
percentage of brand drugs, which have a considerably higher average selling
price than their generic counterparts, and revenue generated by medical product
sales of MedSmart, which was acquired in May 1999.
Cost of revenue for the three months ended March 31, 2000 increased by
66.4% or $3,032,000 from $4,565,000 in 1999 to $7,597,000 in 2000 due to
increased revenue from TouchScript, our e-detailing product and MedSmart,
increased operating costs at sites where we manage the dispensary on behalf of
the physician, increased costs of technical support and a greater percentage of
revenue coming from higher cost brand products. For the three months ended March
31, 2000, cost of revenue as a percentage of total revenue increased to 78.7%
from 75.7% in the prior year period principally due to increased operating costs
at sites where we manage the dispensary on behalf of the physician and a greater
percentage of revenue coming from lower margin brand products. This percentage
increase was partially offset by higher relative margin contributions from
software licensing fees and MedSmart revenues.
Selling, general and administrative expenses for the three months ended
March 31, 2000 increased by 152.0% or $5,395,000 from $3,550,000 in 1999 to
$8,945,999 in 2000 due primarily to additional spending for sales and support
personnel and related expenses needed to sell, implement and support TouchScript
installations, a non-cash charge related to stock options issued to
non-employees, expenses related to MedSmart operations, additional spending for
TouchScript and Internet product development personnel and related support
expenses, increased insurance and other general and administrative expenses. As
a result, selling, general and administrative expenses as a percentage of total
revenue increased to 92.7% for the three months ended March 31, 2000 from 58.9%
of total revenue in the prior year period.
Amortization of intangibles for the three months ended March 31, 2000
increased by 517.2% or $481,000 from $93,000 in 1999 to $574,000 in 2000. The
increase in amortization relates to the amortization of goodwill recorded in the
MedSmart acquisition, which was completed in May 1999, and the Shopping@Home
acquisition, which was completed in June 1999.
9
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Net interest income for the three months ended March 31, 2000 was
$1,183,000 as compared to net interest expense of $109,000 for the prior year
period. The change relates to interest earned on the investment of net proceeds
from our initial public offering and our public offering in March 2000, as well
as the repayment of borrowings under our revolving credit facility with our
commercial bank in July 1999.
We have recorded no provision or benefit for income taxes during the
three months ended March 31, 2000, because we currently anticipate that the
annual effective income tax rate will be minimal or zero, and we have fully
reserved all of our deferred tax assets.
The operating results of our pharmacy benefit management business,
which we sold in March 1999, have been segregated from continuing operations and
reported as a separate line item on the Condensed Consolidated Statements of
Operations under the caption "Income from discontinued operations."
Additionally, the gain we recognized from the sale of this business has been
reported as a separate line item under the caption "Gain from sale of
discontinued operations." The gain in the first quarter of 2000 represents
contingent consideration related to the sale based upon certain pre-defined
metrics, which were achieved in March 2000. Allscripts received the contingent
consideration in May of 2000.
Liquidity and Capital Resources
At March 31, 2000, our principal sources of liquidity consisted of
$110,478,000 of cash and cash equivalents and $46,105,000 of marketable
securities.
Net cash used in operating activities increased by $5,333,000 to
$6,666,000 for the three months ended March 31, 2000, compared to $1,333,000 for
the three months ended March 31, 1999, primarily due to an increase in operating
losses. Accounts receivable, net of allowances, increased $1,624,000 in the
quarter ended at March 31, 2000 versus a decrease of $135,000 in the same period
last year, primarily due to increased sales volume. Interest receivable
increased $440,000 in the quarter ended March 31, 2000 due to interest
receivable on increased levels of cash equivalents and marketable securities.
Accounts payable decreased $251,000 in the quarter ended March 31, 2000 versus
an increase of $736,000 in the same period last year primarily due to the sale
of the pharmacy benefit management business in March 1999. The other receivable,
which represents contingent consideration receivable related to the sale of
Allscripts pharmacy benefit management business in March of 1999 increased to
$4,160,000 in the first quarter of 2000 compared to $3,547,000 in the same
period last year as the metrics that determined the payment of this contingent
consideration were achieved as of March 31, 2000. Allscripts also incurred a
non-cash charge of $742,000 in the first quarter of 2000 related to stock
options issued to non-employees.
Net cash used in investing activities increased to $33,802,000 in the
first three months of 2000 from net cash generated from investing activities of
$7,199,000 in the first three months of 1999, primarily as a result of the net
purchases of marketable securities of $31,056,000 in the first quarter of 2000
offset by $7,473,000 of cash received from the sale of the pharmacy benefit
management business in March 1999. Capital expenditures were $1,746,000 for the
first three months of 2000 compared to $274,000 for the first three months of
1999. The increased level of expenditures in 2000 relates to TouchScript
computer systems and increases in capital outlays to accommodate new employees.
Currently, we have no material commitments for capital expenditures, although we
anticipate ongoing capital expenditures in the ordinary course of business.
Net cash provided by financing activities increased to $110,385,000 for
the first three months of 2000 compared to $1,439,000 for the three months ended
March 31, 1999, primarily due to the receipt of net proceeds of $99,934,000 from
the public offering of our common stock in March 2000 and $10,000,000 related to
a private placement of common stock.
10
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On March 10, 2000, Allscripts completed a public offering of 1,452,000
shares of its common stock, at an offering price of $73 per share. The public
offering resulted in gross proceeds of $105,996,000, $5,561,000 of which was
applied to the underwriting discount and approximately $501,000 of which was
applied to related offering expenses. The remaining net proceeds of
approximately $99,934,000 were invested in interest-bearing, investment-grade
securities.
We believe that our existing cash, cash equivalents and marketable
securities will be sufficient to meet the anticipated cash needs of our current
business during the year ending December 31, 2000. However, any projections of
future cash needs and cash flows are subject to substantial uncertainty. We
will, from time to time, consider the acquisition of, or investment in,
complementary businesses, products, services and technologies, which might
impact our liquidity requirements or cause us to issue additional equity or debt
securities. There can be no assurance that financing will be available in the
amounts or on terms acceptable to us, if at all.
Recently Issued Accounting Pronouncements
In December 1999, the U.S. Securities and Exchange Commission ("SEC")
issued Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial
Statements"("SAB 101"), which provides the SEC's views in applying generally
accepted principles to selected revenue recognition issues. Adoption of SAB 101
is required in the second quarter of fiscal year 2000. The Company does not
expect SAB 101 to have a material impact on the Company's consolidated results
of operations or financial position.
Safe Harbor For Forward-Looking Statements
This report and statements we or our representatives make contain
forward-looking statements that involve risks and uncertainties. We develop
forward-looking statements by combining currently available information with our
beliefs and assumptions. These statements often contain words like believe,
expect, anticipate, intend, contemplate, seek, plan, estimate or similar
expressions. Forward-looking statements do not guarantee future performance.
Recognize these statements for what they are and do not rely upon them as facts.
Forward-looking statements involve risks, uncertainties and
assumptions, including, but not limited to, those discussed in this report. We
make these statements under the protection afforded them by Section 21E of the
Securities Exchange Act of 1934. Because we cannot predict all of the risks and
uncertainties that may affect us, or control the ones we do predict, our actual
results may be materially different from the results we express in our
forward-looking statements.
For a more complete discussion of the risks, uncertainties and
assumptions that may affect us, see our Annual Report on Form 10-K for the
fiscal year ended December 31, 1999.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
As of March 31, 2000, we did not own any derivative financial
instruments but we were exposed to market risks, primarily changes in U.S.
interest rates. We maintain a significant portion of our cash, cash equivalents
and marketable securities in financial instruments with maturities ranging from
less than one month to 27 months with the majority being less than one year.
These financial instruments are subject to interest rate risk and will decline
in value if interest rates increase. Nevertheless, because these financial
instruments have relatively short durations, on average, an increase in interest
rates would not have a significant effect on our financial condition or results
of operations.
11
<PAGE>
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.
In January, 2000, Allscripts issued 6,666 shares of unregistered common
stock upon exercise of a warrant for an aggregate exercise price of $399.96.
Exemption from registration is claimed pursuant to Section 4(2) of the
Securities Act, no public sale having been involved.
In February, 2000, Allscripts sold 214,794 shares of unregistered
common stock to a strategic partner for a purchase price of $10,000,000.
Exemption from registration is claimed pursuant to Section 4(2) of the
Securities Act, no public sale having been involved.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits - See Index to Exhibits.
(b) Reports on Form 8-K. A report on Form 8-K dated February 7, 2000
was filed by Allscripts in connection with the announcement of
results for the three months and twelve months ended December 31,
1999.
A report on Form 8-K dated February 22, 2000 was filed by
Allscripts to correct certain financial data contained in the
February 7, 2000 Report on Form 8-K.
No other reports on Form 8-K were filed during the quarter ended
March 31, 2000.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: May 15, 2000 ALLSCRIPTS, INC.
(Registrant)
By: /s/ David B. Mullen
-----------------------------
David B. Mullen
President and Chief Financial Officer
(Duly Authorized Officer and
Principal Financial Officer)
13
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
- ------- -----------
3.1 By-laws, as amended April, 2000
27.1 Financial Data Schedule
14
<PAGE>
EXHIBIT 3.1
AMENDMENT TO AMENDED AND RESTATED BY-LAWS
-----------------------------------------
OF ALLSCRIPTS, INC.
-------------------
(effective April 7, 2000)
The fourth sentence of Article II, Section 1 (Annual Meeting) is hereby
amended to read in its entirety as follows:
For business to be properly brought before an annual meeting by a
stockholder, the stockholder must have given timely notice thereof in
writing to the secretary of the Corporation not less than one hundred and
twenty (120) days prior to the anniversary date of the immediately
preceding annual meeting nor more than one hundred and fifty (150) days
prior to the anniversary date of the immediately preceding annual meeting.
<PAGE>
BY-LAWS
OF
ALLSCRIPTS, INC.
(A Delaware Corporation)
ARTICLE I.
Offices
Section 1. The registered office of Allscripts, Inc. (the "Corporation")
shall be in Wilmington, New Castle County, Delaware.
Section 2. The Corporation shall have its principal office at 2401
Commerce Drive, Libertyville, Illinois, and it may also have offices at such
other places as the board of directors may from time to time determine.
ARTICLE II.
Stockholders
Section 1. Annual Meeting. The annual meeting of stockholders for the
--------------
election of directors and for the transaction of such other business as may
properly come before the meeting shall be held on such date as the board of
directors shall fix each year. At an annual meeting of stockholders, only such
business shall be conducted as shall have been properly brought before the
meeting. To be properly brought before an annual meeting, business must be (a)
specified in the notice of meeting, or any supplement thereto, given by or at
the direction of the board of directors, (b) otherwise properly brought before
the meeting by or at the direction of the board of directors, or (c) otherwise
properly brought before the meeting by a stockholder. For business to be
properly brought before an annual meeting by a stockholder, the stockholder must
have given timely notice thereof in writing to the secretary of the Corporation
not less than one hundred and twenty (120) days prior to the meeting nor more
than one hundred and fifty (150) days prior to the meeting. A stockholder's
notice to the secretary of the Corporation shall set forth as to each matter the
stockholder proposes to bring before the annual meeting (a) a brief description
of the business desired to be brought before the annual meeting, (b) the name
and address, as they appear on the Corporation's stockholder records, of the
stockholder proposing such business, (c) the class and number of shares of the
Corporation which are beneficially owned by the stockholder, and (d) any
material interest of the stockholder in such business. Irrespective of anything
in these by-laws to the contrary, no business shall be conducted at an annual
meeting except in accordance with the procedures set forth in this Section 1.
The presiding officer of an annual meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly brought
before the meeting in accordance with the provisions of this Section 1, and if
it is so determined, shall so declare to the meeting and any such business not
properly brought before the meeting shall not be transacted.
Section 2. Special Meetings. Special meetings of the stockholders may be
----------------
called only by the chairman, the president or the board of directors pursuant to
a resolution approved by a majority of the entire board of directors.
2
<PAGE>
Section 3. Stockholder Action; How Taken. Any action required or permitted
------------------
to be taken by the stockholders of the Corporation must be effected at a duly
called annual or special meeting of such holders and may not be effected by any
consent in writing by such holders.
Section 4. Place of Meeting. The board of directors may designate any
----------------
place, either within or without Delaware, as the place of meeting for any annual
or special meeting. In the absence of any such designation, the place of meeting
shall be the principal office of the Corporation designated in Section 2 of
Article I of these by-laws.
Section 5. Notice of Meetings. Written or printed notice stating the
------------------
place, day and hour of the meeting and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not less
than ten nor more than sixty days before the date of the meeting, or in the case
of a merger or consolidation, not less than twenty nor more than fifty days
before the date of the meeting, either personally or by mail, by or at the
direction of the chairman or the president, or the secretary, or the officer or
persons calling the meeting, to each stockholder of record entitled to vote at
such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mails in a sealed envelope addressed to the
stockholder at his address as it appears on the records of the Corporation with
postage thereon prepaid.
Section 6. Record Date. For the purpose of determining (a) stockholders
-----------
entitled to notice of or to vote at any meeting of stockholders, or (b)
stockholders entitled to receive payment of any dividend, or (c) stockholders
for any other purpose, the board of directors may fix in advance a date as the
record date for any such determination of stockholders, such date in any case to
be not more than sixty days and not less than ten days, or in the case of a
merger or consolidation not less than twenty days, prior to the date on which
the particular action requiring such determination of stockholders is to be
taken.
Section 7. Quorum. The holders of not less than one-third of the stock
------
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall be requisite and shall constitute a quorum at all
meetings of the stockholders for the transaction of business except as otherwise
provided by statute, by the certificate of incorporation or by these by-laws.
If, however, such quorum shall not be present or represented at any meeting of
the stockholders, the chairman of the meeting shall have the power to adjourn
the meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
When a quorum is present at any meeting, the vote of the holders of a
majority of the stock having voting power present in person or represented by
proxy shall decide any question brought before such meeting, unless the question
is one upon which by express provision of the statutes or of the certificate of
incorporation or of these by-laws, a different vote is required in which case
such express provision shall govern and control the decision of such question.
Section 8. Qualification of Voters. The board of directors may fix a day
-----------------------
and hour not more than sixty nor less than ten days prior to the day of holding
any meeting of stockholders as the time as of which the stockholders entitled to
notice of and to vote at such a meeting shall be determined. Only those persons
who were holders of record of voting stock at such time shall be entitled to
notice of and to vote at such meeting.
Section 9. Procedure. The order of business and all other matters of
---------
procedure at every meeting of stockholders shall be determined by the chairman
of the meeting. The board of directors shall
3
<PAGE>
appoint two or more inspectors of election to serve at every meeting of
stockholders at which directors are to be elected.
ARTICLE III.
Directors
Section 1. Number, Election and Terms. Except as otherwise fixed pursuant
--------------------------
to the provisions of Article Fourth of the certificate of incorporation relating
to the rights of the holders of any class or series of stock having a preference
over the common stock as to dividends or upon liquidation to elect additional
directors under specified circumstances, the number of directors shall be a
minimum of three and fixed from time to time by the board of directors. The
directors, other than those who may be elected by the holders of any class or
series of stock having a preference over the common stock as to dividends or
upon liquidation, shall be classified, with respect to the time for which they
severally hold office, into three classes, as near equal in number as possible,
as determined by the board of directors, one class to hold office initially for
a term expiring at the annual meeting of stockholders to be held in 2000,
another class to hold office initially for a term expiring at the annual meeting
of stockholders to be held in 2001 and another class to hold office initially
for a term expiring at the annual meeting of stockholders to be held in 2002,
with the members of each class to hold office until their successors are elected
and qualified. At each annual meeting of stockholders, the successors of the
class of directors whose term expires at that meeting shall be elected to hold
office for a term expiring at the annual meeting of stockholders held in the
third year following the year of their election.
The term the "entire board" as used in these by-laws means the total number
of directors which the Corporation would have if there were no vacancies.
Subject to the rights of holders of any class or series of stock having a
preference over the common stock as to dividends or upon liquidation,
nominations for the election of directors may be made by the board of directors
or a committee appointed by the board of directors or by any stockholder
entitled to vote in the election of directors generally. However, any
stockholder entitled to vote in the election of directors generally may nominate
one or more persons for election as directors at a meeting only if written
notice of such stockholder's intent to make such nomination or nominations has
been given, either by personal delivery or by United States mail, postage
prepaid, to the secretary of the Corporation not later than (a) with respect to
an election to be held at an annual meeting of stockholders, one hundred twenty
(120) days nor earlier than one hundred fifty (150) days prior to the
anniversary date of the immediately preceding annual meeting, and (b) with
respect to an election to be held at a special meeting of stockholders for the
election of directors, the close of business on the tenth day following the date
on which notice of such meeting is first given to stockholders. Each such notice
shall set forth: (a) the name and address of the stockholder who intends to make
the nomination and of the person or persons to be nominated; (b) a
representation that the stockholder is a holder of record of stock of the
Corporation entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons specified in the
notice; (c) a description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons, naming such person
or persons, pursuant to which the nomination or nominations are to be made by
the stockholder; (d) such other information regarding each nominee proposed by
such stockholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission; and (e)
the consent of each nominee to serve as a director of the Corporation if so
elected. The chairman of the meeting may refuse to acknowledge the nomination of
any person not made in compliance with the foregoing procedure.
4
<PAGE>
Section 2. Newly Created Directorships and Vacancies. Except as otherwise
-----------------------------------------
fixed pursuant to the provisions of Article Fourth of the certificate of
incorporation relating to the rights of the holders of any class or series of
stock having a preference over the common stock as to dividends or upon
liquidation to elect directors under specified circumstances, newly created
directorships resulting from any increase in the number of directors and any
vacancies on the board of directors resulting from death, resignation,
disqualification, removal or other cause shall be filled solely by the
affirmative vote of a majority of the remaining directors then in office, even
though less than a quorum of the board of directors. Any director elected in
accordance with the preceding sentence shall hold office for the remainder of
the full term of the class of directors to which such director's predecessor
shall have been elected and qualified. No decrease in the number of directors
constituting the board of directors shall shorten the term of any incumbent
director.
Section 3. Removal. Subject to the rights of any class or series of stock
-------
having a preference over the common stock as to dividends or upon liquidation to
elect directors under specified circumstances, any director may be removed from
office only for cause and only by the affirmative vote of the holders of 80% of
the combined voting power of the then outstanding shares of stock entitled to
vote generally in the election of directors, voting together as a single class.
Section 4. Regular Meetings. Regular meetings of the board of directors
----------------
shall be held at such times and place as the board of directors may from time to
time determine.
Section 5. Special Meetings. Special meetings of the board of directors
----------------
may be called by or at the request of the chairman or the president or by an
officer of the Corporation upon the request of a majority of the entire board.
The person or persons authorized to call special meetings of the board of
directors may fix any place, either within or without Delaware, as the place for
holding any special meeting of the board of directors called by them.
Section 6. Notice. Notice of regular meetings of the board of directors
------
need not be given. Notice of every special meeting of the board of directors
shall be given to each director at his usual place of business, or at such other
address as shall have been furnished by him for the purpose. Such notice shall
be given at least twenty-four hours before the meeting by telephone, by personal
delivery, by commercial courier, by mail or by facsimile transmission. Such
notice need not include a statement of the business to be transacted at, or the
purpose of, any such meeting.
Section 7. Quorum. A majority of the entire Board shall constitute a
------
quorum for the transaction of business at any meeting of the board of directors,
provided, that if less than a majority of the entire board is present at said
meeting, a majority of the directors present may adjourn the meeting from time
to time until a quorum is obtained without further notice. The act of the
majority of the directors present at a meeting at which a quorum is present
shall be the act of the board of directors unless the act of a greater number is
required by the certificate of incorporation or the by-laws of the Corporation.
Section 8. Compensation. Directors who are also full time employees of the
------------
Corporation shall not receive any compensation for their services as directors
but they may be reimbursed for reasonable expenses of attendance. By resolution
of the board of directors, all other directors may receive either an annual fee
or a fee for each meeting attended, or both, and expenses of attendance, if any,
at each regular or special meeting of the board of directors or of a committee
of the board of directors; provided, that nothing herein contained shall be
construed to preclude any director from serving the Corporation in any other
capacity and receiving compensation therefor.
5
<PAGE>
Section 9. Committees. The board of directors may, by resolution passed
-----------
by a majority of the entire board, designate one or more committees, each
committee to consist of two or more of the directors of the Corporation, which,
to the extent provided in the resolution, shall have and may exercise the powers
of the board of directors in the management of the business and affairs of the
Corporation and may authorize the seal of the Corporation to be affixed to all
papers which may require it. Such committee or committees shall have such name
or names as may be determined from time to time by resolution adopted by the
board of directors. Each committee shall keep regular minutes of its meetings
and report the same to the board of directors when required.
Section 10. Director Emeritus. The Board of Directors may by resolution
-----------------
appoint any former director who has retired from the Board of Directors as a
Director Emeritus. Directors Emeritus may, but are not required to, attend all
meetings (regular and special) of the Board of Directors and will receive notice
of such meetings; however, they shall not have the right to vote and they shall
be excluded from the number of directors for quorum and other purposes.
Directors Emeritus shall be appointed for one year terms and may be reappointed
for up to two additional one year terms.
ARTICLE IV.
Officers
Section 1. Number. The officers of the Corporation shall be a chairman, a
------
vice-chairman (if elected by the board of directors), a president, an executive
vice president (if elected by the board of directors), one or more vice
presidents (the number thereof to be determined by the board of directors), a
treasurer, a secretary and such other officers as may be elected in accordance
with the provisions of this Article.
Section 2. Election and Term of Office. The officers of the Corporation
---------------------------
shall be elected annually by the board of directors at the first meeting of the
board of directors held after each annual meeting of stockholders. If the
election of officers shall not be held at such meeting, such election shall be
held as soon thereafter as convenient. Vacancies may be filled or new offices
created and filled at any meeting of the board of directors. Each officer shall
hold office until his successor shall have been duly elected and shall have
qualified or until his death or until he shall resign or shall have been removed
in the manner hereinafter provided.
Section 3. Removal. Any officer or agent elected or appointed by the board
-------
of directors may be removed by the board of directors whenever in its judgment
the best interests of the Corporation would be served thereby, but such removal
shall be without prejudice to the contract rights, if any, of the person so
removed.
Section 4. Vacancies. A vacancy in any office because of death,
---------
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
Section 5. Chairman. The chairman shall preside at all meetings of the
--------
stockholders and the board of directors. If so appointed by the board of
directors he shall be the chief executive officer of the Corporation and shall
have those duties and responsibilities described in Section 8 of this Article.
He shall perform such other duties as may be prescribed by the board of
directors.
Section 6. Vice-Chairman. The vice-chairman (if elected by the board of
-------------
directors) shall, in the absence of the chairman, preside at all meetings of the
stockholders and the board of directors. If so appointed by the board of
directors he shall be the chief executive officer and shall have those duties
and
6
<PAGE>
responsibilities described in Section 8 of this Article. He shall perform such
other duties as may be prescribed by the board of directors and by the chief
executive officer if he does not have that position.
Section 7. President. The president shall in general be in charge of all
---------
operations of the Corporation and shall direct and administer the activities of
the Corporation in accordance with the policies, goals and objectives
established by the chief executive officer and the board of directors. In the
absence of the chief executive officer, the president shall assume his duties
and responsibilities. In the absence of the chairman and vice-chairman he shall
preside at all meetings of the stockholders and board of directors. He shall
perform such other duties as may be prescribed by the board of directors and
chief executive officer if he does not have that position.
Section 8. Chief Executive Officer. The chief executive officer of the
-----------------------
Corporation shall be either the chairman, the vice-chairman or the president as
determined by the board of directors. The chief executive officer shall provide
overall direction and administration of the business of the Corporation, he
shall interpret and apply the policies of the board of directors, establish
basic policies within which the various corporate activities are carried out,
guide and develop long range planning and evaluate activities in terms of
objectives. He may sign (with the secretary or any other proper officer of the
Corporation thereunto authorized by the board of directors, if such additional
signature is necessary under the terms of the instrument document being executed
or under applicable law, stock certificates of the Corporation, any deeds,
mortgages, bonds, contracts, or other instruments except in cases where the
signing and execution thereof shall be required by law to be otherwise signed or
executed, and he may execute proxies on behalf of the Corporation with respect
to the voting of any shares of stock owned by the Corporation. He shall have the
power to (1) designate management committees of employees deemed essential in
the operations of the Corporation, its divisions or subsidiaries, and appoint
members thereof, subject to the approval of the board of directors; (2) appoint
certain employees of the Corporation as vice presidents of one or several
divisions or operations of the Corporation, subject to the approval of the board
of directors, provided however, that any vice president so appointed shall not
be an officer of the Corporation for any other purpose; and (3) appoint such
other agents and employees as in his judgment may be necessary or proper for the
transaction of the business of the Corporation and in general shall perform all
duties incident to the office of chief executive.
Section 9. Executive Vice President. The executive vice president (if
------------------------
elected by the board of directors) shall report to either the chief executive
officer or the president as determined in the corporate organization plan
established by the board of directors. He shall direct and coordinate such major
activities as shall be delegated to him by his superior officer in accordance
with policies established and instructions issued by his superior officer, the
chief executive officer, or the board of directors.
Section 10. Vice President. The board of directors may elect one or
--------------
several vice presidents. Each vice president shall report to either the chief
executive officer, the chief operating officer or the executive vice president
as determined in the corporate organization plan established by the board of
directors. Each vice president shall perform such duties as may be delegated to
him by his superior officers and in accordance with the policies established and
instructions issued by his superior officer, the chief executive officer or the
board of directors. The board of directors may designate any vice president as a
senior vice president and a senior vice president shall be senior to all other
vice presidents and junior to the executive vice president. In the event there
is more than one senior vice president, then seniority shall be determined by
and be the same as the annual order in which their names are presented to and
acted on by the board of directors.
Section 11. The Treasurer. The treasurer shall (a) have charge and custody
-------------
of and be responsible for all funds and securities of the Corporation; receive
and give receipts for moneys due and payable to the Corporation from any source
whatsoever, and deposit all such moneys in the name of the
7
<PAGE>
Corporation in such banks, trust companies or other depositories as shall be
selected by the Corporation; (b) in general perform all the duties incident to
the office of treasurer and such other duties as from time to time may be
assigned to him by the chief executive officer, chief operating officer or by
the board of directors. If required by the board of directors, the treasurer
shall give a bond for the faithful discharge of his duties in such sum and with
such surety or sureties as the board of directors shall determine.
Section 12. The Assistant Treasurer. The assistant treasurer (or, if more
-----------------------
than one, the assistant treasurers) shall, in the absence or disability of the
treasurer, perform the duties and exercise the powers of the treasurer and shall
perform such other duties and have such other powers as the board of directors
may from time to time prescribe.
Section 13. The Secretary. The secretary shall: (a) keep the minutes of
-------------
the stockholders' and the board of directors' meetings in one or more books
provided for that purpose; (b) see that all notices are duly given in accordance
with the provisions of these by-laws or as required by law; (c) be custodian of
the corporate records and of the seal of the Corporation and see that the seal
of the corporation is affixed to all stock certificates prior to the issue
thereof and to all documents, the execution of which on behalf of the
Corporation under its seal is duly authorized in accordance with the provisions
of these by-laws or as required by law; (d) be custodian of the corporate
records and of the seal of the Corporation and see that the seal of the
Corporation is affixed to all stock certificates prior to the issue thereof and
to all documents, the execution of which on behalf of the Corporation under its
seal is duly authorized in accordance with the provisions of these by-laws; (e)
keep a register of the post office address of each stockholder which shall be
furnished to the secretary by such stockholder; (f) sign with the chairman,
president, or a vice president, stock certificates of the Corporation, the issue
of which shall have been authorized by resolution of the board of directors; (g)
have general charge of the stock transfer books of the Corporation; (h) in
general perform all duties incident to the office of secretary and such other
duties as from time to time may be assigned to him by the chief executive
officer, chief operating officer or by the board of directors.
Section 14. The Assistant Secretary. The assistant secretary (or, if more
-----------------------
than one, the assistant secretaries) shall in the absence or disability of the
secretary, perform the duties and exercise the powers of the secretary and shall
perform such other duties and have such other powers as the board of directors
may from time to time prescribe.
ARTICLE V.
Fiscal Year
The fiscal year of the Corporation shall begin on the first day of January
in each year and end on the thirty-first day of December in each year.
ARTICLE VI.
Seal
The board of directors shall provide a corporate seal which shall be in the
form of a circle and shall have inscribed thereon the name of the Corporation
and the words "Corporate Seal, Delaware".
8
<PAGE>
ARTICLE VII.
Waiver of Notice
Whenever any notice whatsoever is required to be given under the provisions
of these by-laws or under the provisions of the certificate of incorporation or
under the provisions of the laws of the state of Delaware, waiver thereof in
writing, signed by the person or persons entitled to such notice, whether before
or after the time stated therein, shall be deemed equivalent to the giving of
such notice.
ARTICLE VIII.
Amendments
Subject to the provisions of the certificate of incorporation, these by-
laws may be altered, amended or repealed at any regular meeting of the
stockholders, or at any special meeting of stockholders duly called for that
purpose, by a majority vote of the shares represented and entitled to vote at
such meeting; provided that in the notice of such special meeting notice of such
purpose shall be given. Subject to the laws of the State of Delaware, the
certificate of incorporation and these by-laws, the board of directors may by a
majority vote of those present at any meeting at which a quorum is present amend
these by-laws, or enact such other by-laws as in their judgment may be advisable
for the regulation of the conduct of the affairs of the Corporation.
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND> This schedule contains summary financial information extracted from
the condensed consolidated financial statements of Allscripts, Inc. as of and
for the three months ended March 31, 2000 and is qualified in its entirety by
reference to such financial statements.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 110,478
<SECURITIES> 31,886
<RECEIVABLES> 10,192
<ALLOWANCES> 3,442
<INVENTORY> 3,938
<CURRENT-ASSETS> 158,852
<PP&E> 12,118
<DEPRECIATION> 5,925
<TOTAL-ASSETS> 183,312
<CURRENT-LIABILITIES> 6,664
<BONDS> 0
0
0
<COMMON> 263
<OTHER-SE> 176,385
<TOTAL-LIABILITY-AND-EQUITY> 183,312
<SALES> 9,647
<TOTAL-REVENUES> 9,647
<CGS> 7,597
<TOTAL-COSTS> 7,597
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (1,183)
<INCOME-PRETAX> (6,286)
<INCOME-TAX> 0
<INCOME-CONTINUING> (6,286)
<DISCONTINUED> 4,243
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,043)
<EPS-BASIC> (0.08)
<EPS-DILUTED> (0.08)
</TABLE>
