<PAGE>
As filed with the Securities and Exchange Commission on April 28, 1999
Registration No. 333-67353
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
Amendment No. 1 to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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MEDICAL GRAPHICS CORPORATION
(Exact name of registrant as specified in its charter)
MINNESOTA 41-1316712
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
350 Oak Grove Parkway
Saint Paul, Minnesota 55127
(651) 484-4874
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive office)
-------------------------
Richard E. Jahnke
President, Chief Executive Officer
Medical Graphics Corporation
350 Oak Grove Parkway
Saint Paul, Minnesota 55127
(651) 484-4874
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
-------------------------
COPIES TO:
Thomas G. Lovett IV, Esq.
Kristin L. Johnson, Esq.
Lindquist & Vennum P.L.L.P.
4200 IDS Center
80 South Eighth Street
Minneapolis, Minnesota 55402
Telephone: (612) 371-3211
Approximate date of commencement of proposed sale to public: From time to time
after this Registration Statement becomes effective.
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: /X/
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering: / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earliest 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: / /
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Maximum Maximum
Amount to be Offering Aggregate Amount of
Title of Each Class of Registered Price Offering Registration
Securities to be Registered Per Unit Price Fee
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<S> <C> <C> <C> <C>
Common Stock, $.05 par value . . . . . . . . . . . . . . . . . . . . 3,140,908 $0.8125(1) $1,123,958(1) $313(2)
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</TABLE>
(1) Estimated solely for the purpose of determining the registration fee and
based on the closing price of the Company's Common Stock on the Nasdaq
SmallCap Market on November 12, 1998 pursuant to Rule 457(c). Pursuant to
Rule 429(b), the Prospectus contained in this Registration Statement is a
combined Prospectus that relates to Registration Statements Nos. 333-32467
and 333-41721.
(2) The Company paid a total of $522 for the registration of 666,667 shares
with Registration No. 333-32467 and $923 for the registration of 1,090,908
shares with Registration No. 333-41721. In both cases, such shares have
been adjusted for the Company's June 1998 3-for-2 stock split.
Accordingly, the fee being paid with this filing reflects only the
1,383,333 new shares being covered by this Registration Statement.
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 THAT 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>
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN
OFFER TO SELL THESE SECURITIES, AND IT IS NOT A SOLICITATION TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
PROSPECTUS
SUBJECT TO COMPLETION
APRIL 28, 1999
MEDICAL GRAPHICS CORPORATION
3,140,908 SHARES OF
COMMON STOCK
These shares of our common stock are being sold by the following selling
shareholders. We will not receive any part of the proceeds from the sale.
<TABLE>
<CAPTION>
Name Shares to be Sold
---- -----------------
<S> <C>
- FAMCO II LLC 2,163,636
- Special Situations Fund III L.P. 272,727
- Special Situations Private Equity Fund L.P. 363,636
- Special Situations Cayman Fund L.P. 90,909
- Compumedics Sleep Pty Ltd. 250,000
</TABLE>
These shares represent approximately 44.2 percent of the common stock we
would have outstanding after these shares are sold.
Our common stock is listed on the Nasdaq SmallCap Market under the symbol
"MGCC." The reported last sale price of the common stock on April 23, 1999, was
$1.00 per share.
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING ON
PAGE 3 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
APRIL 28, 1999
<PAGE>
PROSPECTUS SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND FINANCIAL STATEMENTS APPEARING ELSEWHERE IN THIS PROSPECTUS AND
IN DOCUMENTS INCORPORATED HEREIN BY REFERENCE.
ABOUT MEDGRAPHICS
Medical Graphics Corporation designs products and related software that
assist health care professionals in the prevention, early detection and
cost-effective treatment of heart and lung disease and the evaluation of sleep
disorders. MedGraphics products include pulmonary testing equipment,
cardiopulmonary exercise testing systems and computerized sleep diagnostic
systems.
Our executive offices are located at 350 Oak Grove Parkway, Saint Paul,
Minnesota 55127. Our telephone number is (651) 484-4874.
THE OFFERING
The selling shareholders listed on the cover of this prospectus are
offering 3,140,908 shares of common stock. The selling shareholders are
described in the section "Selling Shareholders."
<TABLE>
<S> <C>
Common stock offered by selling shareholders.................... 3,140,908
Common stock outstanding after sale by selling shareholders..... 7,113,620
Nasdaq SmallCap Symbol.......................................... MGCC
</TABLE>
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock. See
"Use of Proceeds."
RISK FACTORS
This offering involves substantial investment risk and the shares should be
purchased only by persons who can afford the loss of their entire investment.
For a description of these risks, please see "Risk Factors."
------------------------------------------
THE FOLLOWING UNITED STATES REGISTERED TRADEMARKS APPEAR IN THIS PROSPECTUS
AND ARE OWNED BY MEDGRAPHICS: MEDGRAPHICS AND CPX EXPRESS. WINDOWS IS A
TRADEMARK OF MICROSOFT CORPORATION.
-------------------------------------
2
<PAGE>
RISK FACTORS
Investing in our common stock is risky. In addition to the other
information in this prospectus, you should consider the following risks in
deciding whether to invest in our common stock.
WE HAVE INCURRED LOSSES IN EACH OF THE PAST FOUR YEARS.
We have experienced net losses of 1,576,000, $5,112,000, $8,361,000 and
$1,731,000 for the years ended December 31, 1998, 1997, 1996 and 1995,
respectively. Although we achieved profitability in the fourth quarter of 1998,
we have not been able to achieve sustained profitability. We may incur losses
in the future.
WE ARE DEPENDENT UPON BANK FINANCING FOR OUR WORKING CAPITAL NEEDS.
At December 31, 1998, we had a bank working capital line of credit that
provides for total borrowings of up to $4,100,000, based on available
collateral, at the discretion of the lender and expires March 31, 2000. We are
dependent upon this credit facility to meet our working capital requirements.
Total borrowings outstanding under the credit agreement are secured by our
accounts receivable and inventories. The credit agreement contains certain
restrictive covenants as well as limitations on capital expenditures and payment
of dividends. We did not achieve technical compliance with all the 1998
performance ratios stated in the credit agreement and amended our credit
agreement on several occasions to achieve compliance. The bank has waived all
violations and at December 31, 1998, we were in compliance with the credit
agreement. While we believe that our cash and cash equivalents and borrowings
available under this line of credit will be sufficient to fund our operations
through at least December 1999, there can be no assurance that our operations
will perform as management anticipates.
OUR INTERNATIONAL REVENUES HAVE DECLINED OVER THE PAST SEVERAL YEARS. WE RELY
UPON DISTRIBUTORS TO SELL OUR PRODUCT INTERNATIONALLY.
Our sales outside North America have decreased to 13.1% of revenue in 1998
from 26.7% in 1996. Our international sales have declined since the closing of
our German subsidiary in late 1996 and 1997. The decline has generally affected
all our product categories. We do not expect foreign sales to increase
significantly until we successfully rebuild our international distribution
network.
During 1998, we used approximately 33 international sales organizations to
sell our products into 45 countries. Sales into foreign countries involve
certain risks not ordinarily associated with domestic business, including
fluctuations in exchange rates which may affect sales even when all products are
denominated in United States dollars, reliance upon distributors and
fluctuations in sales resulting from changes in local economies.
THE MARKET FOR OUR PRODUCTS IS VERY COMPETITIVE.
The industry for companies selling cardiopulmonary diagnostic systems and
sleep disorders diagnostic systems is competitive. Our competitors include
large medical companies, some of which have greater financial and technical
resources and broader product lines than us. We believe that the principal
competitive factors in its markets are product features, price, quality,
customer service, performance, market reputation, breadth of product offerings
and effectiveness of sales and marketing efforts.
3
<PAGE>
Our success depends on our ability to anticipate changes in technology and
industry standards, to develop and successfully introduce new and enhanced
products on a timely basis and to promote market acceptance of such products.
There are a number of companies that currently offer, or are in the process of
developing, products that compete with products offered by us. Some of these
competitors may have greater capital resources, research and development staffs
and experience in the medical device industry, including experience with respect
to regulatory compliance in the development, manufacturing and sale of medical
products similar to those offered by us. We believe the principal competitors
for our traditional products are SensorMedics Corporation, a subsidiary of
Thermo Electron Corporation and Erich Jaeger GmbH & Co. In April 1998,
Thermedics Inc., a publicly held subsidiary of Thermo Electron Corporation
announced it had signed a non-binding letter of intent to acquire Jaeger.
We believe that our principal competitors in the sleep diagnostic market
are SensorMedics, Healthdyne Technologies, Inc. and Nellcor Puritan Bennett.
There can be no assurance that some of these competitors will not succeed in
developing technologies and products that are more effective than those
currently used or produced by us or that would render some products offered by
us obsolete or non-competitive.
Competition based on price is expected to become an increasingly important
factor in customer purchasing patterns as a result of cost containment pressures
on, and consolidation in, the health care industry. This competition has
exerted, and is likely to continue to exert, downward pressure on the prices we
are able to charge for our products. There can be no assurance that we will be
able to offset such downward price pressure through corresponding cost
reductions. Any failure to offset such pressure could have an adverse effect on
our business, results of operations or financial condition.
WE RELIED UPON PRIVATE FINANCING IN 1997 AND 1998 TO MEET OUR WORKING CAPITAL
NEEDS AND REMAIN IN COMPLIANCE WITH NASDAQ SMALLCAP CAPITAL REQUIREMENTS. WE
MAY BE REQUIRED TO RAISE MONEY IN THIS MANNER AGAIN.
During 1997 and 1998, we raised money for working capital in the following
private offerings:
- - In March and April 1997, we issued 444,445 shares of Class A stock for
gross proceeds of $1.5 million.
- - In November 1997, we issued 545,454 shares of common stock for gross
proceeds of $1.5 million. In January and February 1998, we issued an
additional 545,454 shares of common stock for an additional $1.5 million
to the same investors.
- - In September 1998, we issued 550,000 shares of common stock for gross
proceeds of $550,000.
We raised this money to satisfy our working capital needs and to ensure our
continued quotation on the Nasdaq system. Although we generally issued the
shares at prices that were at or near market price, the issuance of the shares
has resulted in a large concentration of our securities with a limited number of
investors. Although we would prefer to raise additional equity in the future,
if needed, through the public offering of our securities, we may be required to
raise funds privately again to meet our working capital needs or Nasdaq
requirements.
4
<PAGE>
A SIGNIFICANT PERCENTAGE OF OUR COMMON STOCK IS HELD BY A FEW SHAREHOLDERS THAT
HAVE THE POWER TO EXERCISE CONTROL OVER OUR BOARD OF DIRECTORS.
FAMCO II LLC, a limited liability company, is the beneficial owner of
2,163,636 shares of our common stock, including 1,500,000 shares issuable upon
the conversion of Class A stock. This is equal to 30.4% of our voting
securities. Family Financial Strategies, Inc. manages FAMCO II, and John
Wunsch, a director of MedGraphics is the Chief Executive Officer of Family
Financial Strategies, Inc. In addition, Heartland Advisers, Inc. controls
680,700 shares of our common stock, or 9.6% of our voting shares. Austin W.
Marxe, who is associated with the Special Situations selling shareholders named
in this prospectus, controls 727,272 or 10.2 % of our voting securities. These
shareholders acting together have the ability to potentially exercise control
over our board of directors.
SALE OF A LARGE NUMBER OF SHARES BEING REGISTERED THROUGH THIS PROSPECTUS CAN
AFFECT THE PRICE OF OUR COMMON STOCK.
The five selling shareholders named in this prospectus own shares
equivalent to 3,140,908 shares of common stock, including Class A stock
convertible into 1,500,000 shares of common stock. Sales of any significant
amount of this stock could adversely affect the price of our common stock.
OUR SMALL MARKET CAPITALIZATION MAY RESULT IN VOLATILITY IN THE PRICE OF OUR
COMMON STOCK.
We have approximately 5.6 million shares of common stock outstanding and an
additional 1,500,000 shares of common stock issuable upon the conversion of
outstanding Class A stock. The number of our shares outstanding is smaller than
most other publicly traded companies. As a result, the purchase or sale of
relatively small amounts of our stock could result in volatility in our stock.
IF OUR STOCK PRICE FAILS TO REMAIN AT OR ABOVE $1.00 PER SHARE, WE MAY BE
DELISTED FROM THE NASDAQ SMALL CAP MARKET
Under the rules of the Nasdaq SmallCap Market, the price of our stock must
remain at or above $1.00. From time to time, our stock has traded at a price
less than a $1.00. If the price of our stock remains less than $1.00 for an
extended period of time, Nasdaq could delist our stock from the Nasdaq SmallCap
Market and we would trade in the over-the-counter market or through the Nasdaq
OTC Bulletin board. This might have an adverse effect on the liquidity of our
securities and our ability to raise money in the future.
OUR CLASS A STOCK AND ONE OF OUR WARRANTS HAVE ANTIDILUTION FEATURES THAT COULD
DILUTE THE SHARE OWNERSHIP OF OUR EXISTING SHAREHOLDERS IN THE FUTURE.
The Class A stock issued by us in March and April 1997 includes
antidilution features. Under the terms of the Class A stock, if we issue
securities at a price less than the conversion price of the Class A stock, then
the price at which the Class A stock is convertible into common stock is lowered
to the issuance price.
As a result of our September 1998 issuance of 550,000 shares of common
stock at $1.00 per shares, the conversion provisions of the Class A stock were
adjusted so that the Class A stock became
5
<PAGE>
convertible into common stock at a price of $1.00 per share. This increased the
number of shares issuable on conversion of the Class A stock from 666,666 to
1,500,000.
In addition, a warrant we issued to a bank contains similar antidilution
features. As a result of the September 1998 issuance, the warrant increased
from a warrant to purchase 93,750 share at a price of $2.25 to a warrant to
purchase 210,937 shares at a price of $1.00. In the event we issue equity
securities in the future at a price less than $1.00 per share, unless waived,
the antidilution provisions of the Class A stock and the warrant would result in
the conversion prices being lowered to the price at which we issued the common
stock without any additional payment on the part of the holders. This would
dilute our other existing shareholders' ownership.
6
<PAGE>
RECENT DEVELOPMENTS
YEAR 2000
The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Our computer
equipment, software, devices and products with imbedded technology that are
time-sensitive may recognize a date using "00" as the year 1900 rather than the
year 2000. This could result in a system failure or miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process transactions, send invoices or engage in similar normal business
activities. A detailed description of our Year 2000 state of readiness, costs
to address the Year 2000 issue, risks of the Year 2000 issue and our Contingency
Plan are contained in our Form 10-KSB for the year ended December 31, 1998.
USE OF PROCEEDS
MedGraphics will not receive any proceeds from sales of the shares by the
selling shareholders.
SELLING SHAREHOLDERS
The following table sets forth certain information with respect to the
beneficial ownership of MedGraphics common stock by the selling shareholders as
of April 17, 1999.
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES MAXIMUM NUMBER OF SHARES TO BE BENEFICIALLY
---- BENEFICIALLY OWNED SHARES TO BE SOLD OWNED AFTER THE OFFERING
PRIOR TO OFFERING ----------------- ------------------------
-----------------
NUMBER PERCENT NUMBER PERCENT
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
FAMCO II LLC 2,163,636 30.4 2,163,636 -0- *
600 South Highway 169, Suite 850
St. Louis Park, MN 55426
Compumedics Sleep Pty Ltd 250,000 3.5 250,000 -0- *
ACN 006854 897
1 Marine Parade
Abbotsford, VIC 3067
Australia
Special Situations Fund III, L.P. 272,727 3.8 272,727 -0- *
153 East 53rd Street, 51st Floor
New York, NY 10022
Special Situations Private Equity 363,636 5.1 363,636 -0- *
Fund L.P.
153 East 53rd Street, 51st Floor
New York, NY 10022
Special Situations Cayman Fund L.P. 90,909 1.3 90,909 -0- *
153 East 53rd Street, 51st Floor
New York, NY 10022
</TABLE>
7
<PAGE>
- - FAMCO is managed by Family Financial Strategies, Inc., of which John
Wunsch, a director of MedGraphics, is the Chief Executive Officer. As a
result of this affiliation, Mr. Wunsch may be deemed to beneficially own
all shares owned by FAMCO and may be deemed to hold shared voting and
investment power with respect to such shares owned by FAMCO. The FAMCO
share totals include 1,500,000 shares of common stock issuable upon
conversion of Class A stock purchased in a private placement on March 31,
1997 and April 15, 1997; 363,636 shares purchased in November 1997 and
February 1998; and 300,000 shares purchased in September 1998.
- - Austin W. Marxe is the principal owner and President of AWM Investment
Company, Inc. AWM is the sole general partner of MGP Advisers L.P., a
registered investment adviser. MGP Advisers, Inc. is a general partner of
and investment adviser to Special Situations III, L.P. AWM is also a
registered investment adviser and general partner of Special Situations
Cayman Fund L.P. This disclosure is based on a Schedule 13G/A's, filed
with the SEC on January 8, 1999.
* Indicates less than one percent.
8
<PAGE>
PLAN OF DISTRIBUTION
The selling shareholders may offer their shares at various times in one or
more of the following transactions:
- - on the Nasdaq SmallCap Market, where our common stock is listed;
- - in the over-the-counter market;
- - in transactions other than on such exchanges or in the over-the-counter
market;
- - in connection with short sales of the shares;
- - by pledge to secure debts and other obligations;
- - in connection with the writing of non-traded and call options, in hedge
transactions and in settlement of other transactions in standardized or
over-the-counter options; or
- - in a combination of any of the above transactions.
The selling shareholders may sell their shares at market prices prevailing
at the time of sale, at prices related to such prevailing market prices, at
negotiated prices or at fixed prices.
The selling shareholders may use broker-dealers to sell their shares. If
this happens, broker-dealers will either receive discounts or commissions from
the selling shareholders, or they will receive commissions from purchasers of
shares for whom they acted as agents.
DESCRIPTION OF SECURITIES
COMMON STOCK. We have one class of capital stock registered pursuant to
Section 12 of the Securities Exchange Act of 1934, common stock, $.05 par value.
We are authorized to issue up to 9,500,000 shares of common stock. No share of
common stock is entitled to preference over any other share, and each share is
equal to any other share in all respects. Holders are entitled to one vote for
each share held of record at each meeting of shareholders. In any distribution
of capital assets, whether voluntary or involuntary, holders are entitled to
receive pro rata the assets remaining after creditors have been paid in full.
Holders of common stock have no preemptive rights. The outstanding shares are,
and the common stock offered hereby upon payment therefore will be, fully paid
and nonassessable.
CUMULATIVE VOTING. There is no cumulative voting for the election of
directors. Accordingly, the owners of a majority of shares of common stock
outstanding may elect all of the directors, if they choose to do so, and the
owners of the balance of such shares will not be able to elect any directors.
DIVIDEND POLICY. MedGraphics has adopted the policy of retaining all of
its earnings to finance the growth of its business and, accordingly, does not
anticipate payment of any dividends in the foreseeable future. In addition,
covenants with our bank limit our payment of dividends.
9
<PAGE>
CLASS A STOCK. Our Class A stock has a liquidation preference of $3.375 per
share. Each Class A share is currently convertible into 3.375 shares of common
stock and has voting rights equal to the common stock into which it is
convertible. As a result, the 444,445 shares are convertible into 1,500,000
shares of common stock, which would be equal to 21.1% of MedGraphics common
stock after the conversation.
LEGAL MATTERS
Our outside general counsel, Lindquist & Vennum P.L.L.P. of Minneapolis,
Minnesota, will issue an opinion about the legality of the shares for us and the
selling shareholders.
EXPERTS
The financial statements incorporated in this prospectus by reference from
MedGraphics 1998 Annual Report on Form 10-KSB have been audited by Deloitte &
Touche LLP, independent public accountants as stated in their report, which is
incorporated herein by reference, and has been so incorporated in reliance upon
the report of such firm given upon their authority as an expert in accounting
and auditing.
INDEMNIFICATION
MedGraphics Articles of Incorporation eliminate or limit certain
liabilities of its directors and MedGraphics Bylaws provide for indemnification
of directors, officers and employees of MedGraphics in certain instances.
Insofar as exculpation of, or indemnification for, liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or persons
controlling MedGraphics pursuant to the foregoing provisions, MedGraphics has
been informed that in the opinion of the Securities and Exchange Commission such
exculpation or indemnification is against public policy as expressed in the Act
and is therefore unenforceable.
10
<PAGE>
WHERE YOU CAN FIND INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, DC, New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our SEC filings are also available to the public from
our web site at www.medgraphics.com or at the SEC's web site at
http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information. We
incorporate by reference the document listed below and any future filings made
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the selling shareholders sell all the shares. This
prospectus is part of registration statements we filed with the SEC
(Registration Nos. 333-32467, 333-41721 and 333-67353).
- - Annual Report on Form 10-KSB for the fiscal year ended December 31, 1998;
You may request a copy of these filings, at no cost, by writing or telephoning
us at the following address:
Chief Financial Officer
Medical Graphics Corporation
350 Oak Grove Parkway
Saint Paul, MN 55127
(651) 484-4874
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. The selling shareholders will
not make an offer of these shares in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of those documents.
11
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14: OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
SEC registration fee. . . . . . . . . . . . . . . . . 313.00
Accounting fees and expenses. . . . . . . . . . . . . 10,000.00
Legal fees and expenses . . . . . . . . . . . . . . . 10,000.00
Miscellaneous . . . . . . . . . . . . . . . . . . . . 4,687.00
---------
Total . . . . . . . . . . . . . . . . . . . . . . . 25,000.00
</TABLE>
Except for the SEC fee, all of the foregoing expenses have been estimated.
ITEM 15: INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 302A.521 of the Minnesota Statutes requires, among other things,
the indemnification of persons made or threatened to be made a party to a
proceeding by reason of acts or omissions performed in their official capacity
as an officer, director, employee or agent of the corporation against judgments,
penalties and fines (including attorneys' fees) if such person is not otherwise
indemnified, acted in good faith, received no improper benefit, reasonably
believed that such conduct was in the best interests of the corporation, and, in
the case of criminal proceedings, had no reason to believe the conduct was
unlawful. In addition, Section 302A.521, subd. 3, of the Minnesota Statutes
requires payment by the corporation, upon written request, of reasonable
expenses in advance of final disposition in certain instances if a decision as
to required indemnification is made by a disinterested majority of the Board of
Directors present at a meeting at which a disinterested quorum is present, or by
a designated committee of the Board, by special legal counsel, by the
shareholders or by a court.
MedGraphics Articles of Incorporation and Bylaws provide for the
indemnification of its directors, officers, employees, and agents in accordance
with, and to the fullest extent permitted by, the provisions of the Minnesota
Business Corporation Act, as amended from time to time.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description
- --------------------------
<S> <C>
5.1 Opinion and Consent of Lindquist & Vennum P.L.L.P., counsel to
the Company(1)
23.1 Consent of Lindquist & Vennum P.L.L.P. (see Exhibit 5.1 above)
23.2 Consent of Deloitte & Touche LLP, independent public accountants
24.1 Powers of Attorney(1)
(1) Previously filed
</TABLE>
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
II-1
<PAGE>
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the Prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
Registration Statement is on Form S-3 or Form S-8, and 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 the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(c) 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 foregoing provisions 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 Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Amendment No. 1 to Form S-3 registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Saint Paul, State of Minnesota, on the 26th day of April, 1999.
MEDICAL GRAPHICS CORPORATION
By /s/ Richard E. Jahnke
-----------------------------------------------
Richard E. Jahnke, President and
Chief Executive 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 indicated on April 26, 1999.
SIGNATURE
/s/ Richard E. Jahnke
- ---------------------------------
Richard E. Jahnke, President,
Chief Executive Officer
(Principal Executive Officer) and Director
/s/ Dale H. Johnson
- ---------------------------------
Dale H. Johnson, Chief Financial
Officer (Principal Financial
Officer)
* /s/ Mark W. Sheffert
- ---------------------------------
Mark W. Sheffert, Chairman
* /s/ Anthony J. Adducci
- ---------------------------------
Anthony J. Adducci, Director
* /s/ Gerald T. Knight
- ---------------------------------
Gerald T. Knight, Director
* /s/ W. Edward McConaghay
- ---------------------------------
W. Edward McConaghay, Director
* /s/ Donald C. Wegmiller
- ---------------------------------
Donald C. Wegmiller, Director
* /s/ John C. Penn
- ---------------------------------
John C. Penn, Director
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<PAGE>
* /s/ John D. Wunsch
- ---------------------------------
John D. Wunsch, Director
* /s/Richard E. Jahnke
----------------------------------------
By Richard E. Jahnke
by Power of Attorney
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<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Amendment No. 1 to
Registration Statement No. 333-67353, of Medical Graphics Corporation on Form
S-3 of our report dated April 14, 1999, appearing in the Annual Report on
Form 10-KSB of Medical Graphics Corporation for the year ended December 31,
1998 and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
DELOITTE & TOUCHE LLP
Minneapolis, Minnesota
April 26, 1999 /s/ Deloitte & Touche LLP
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