<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 29, 1995.
REGISTRATION NO.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
CYCARE SYSTEMS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 91-0842322
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
------------------------
7001 NORTH SCOTTSDALE ROAD
SUITE 1000
SCOTTSDALE, ARIZONA 85253-3644
(602) 596-4300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
MARK R. SCHONAU
CHIEF FINANCIAL OFFICER -- SECRETARY/TREASURER
CYCARE SYSTEMS, INC.
7001 NORTH SCOTTSDALE ROAD
SUITE 1000
SCOTTSDALE, ARIZONA 85253-3644
(602) 596-4374
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE)
------------------------
Copy to:
MATTHEW P. FEENEY
SNELL & WILMER L.L.P.
ONE ARIZONA CENTER
PHOENIX, ARIZONA 85004-0001
(602) 382-6239
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE 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 earlier effective registration statement
for the same offering: / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: / /
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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- ----------------------------------------------------------------------------------------------------------
PROPOSED PROPOSED
TITLE OF EACH CLASS AMOUNT MAXIMUM MAXIMUM AMOUNT OF
OF SECURITIES TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1) SHARE(2) PRICE(2) FEE
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value..... 21,430 $23.4375 $502,266 $174
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
(1) In the event of a stock split, stock dividend, or similar transaction
involving the Company's Common Stock, in order to prevent dilution, the
number of shares registered shall be automatically increased to cover the
additional shares in accordance with Rule 416(a) under the Securities Act.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c), based on the average of the high and low prices of
the Common Stock on December 28, 1995, as reported on the New York Stock
Exchange.
The Company hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Company shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission acting pursuant to said section 8(a)
may determine.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED DECEMBER 29, 1995
21,430 SHARES
CYCARE SYSTEMS, INC.
COMMON STOCK
This Prospectus relates to the offer and sale by Richard D. Jugel ("Selling
Stockholder") of 21,430 shares of the Common Stock, $0.01 par value per share
(the "Common Stock"), of CyCare Systems, Inc., a Delaware corporation (the
"Company"). The Company will not receive any portion of the proceeds from the
sale of the Common Stock offered hereby. The Company's Common Stock is traded on
the New York Stock Exchange under the symbol "CYS." On December 28, 1995, the
closing sales price for the Common Stock, as reported on the New York Stock
Exchange, was $23.25 per share.
The Selling Stockholder may from time to time effect sales of Common Stock
in one or more transactions pursuant to Rule 144 under the Securities Act of
1933, as amended (the "Securities Act"), in privately negotiated transactions,
or in ordinary broker's transactions on the New York Stock Exchange, at the
price prevailing at the time of such sales, at prices relating to such
prevailing market prices, or at negotiated prices. It is anticipated that any
broker-dealers participating in such sales of securities will receive the usual
and customary selling commissions. The net proceeds to the Selling Stockholder
will be the proceeds received by him upon such sales, less brokerage
commissions. All expenses of registration incurred in connection with this
offering are being borne by the Company. The brokerage and other expenses of
sale incurred by the Selling Stockholder will be borne by the Selling
Stockholder. See "Plan of Distribution" and "Selling Stockholder".
------------------------
SEE "RISK FACTORS" ON PAGE 3 FOR A DISCUSSION OF CERTAIN FACTORS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
------------------------
, 1996
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements, and other information with the
Securities and Exchange Commission (the "Commission"). The reports, proxy
statements, and other information filed by the Company with the Commission may
be inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
its regional offices located at 7 World Trade Center, 13th Floor, New York, New
York 10048, and Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The Company's Common Stock is listed on the New York
Stock Exchange. Reports, proxy statements, and other information filed by the
Company may be inspected at the New York Stock Exchange, 20 Broad Street, New
York, New York 10005.
This Prospectus constitutes a part of a registration statement on Form S-3
(the "Registration Statement") that the Company has filed with the Commission
under the Securities Act. As permitted by the rules and regulations of the
Commission, this Prospectus omits certain of the information contained in the
Registration Statement and the exhibits thereto and reference is hereby made to
the Registration Statement and related exhibits for further information with
respect to the Company and the Common Stock offered hereby. Statements contained
in this Prospectus as to the provisions of any documents filed as an exhibit to
the Registration Statement or otherwise filed with the Commission are not
necessarily complete and, in each instance, reference is made to the copy of
such document as so filed. Each such statement is qualified in its entirety by
such reference.
INFORMATION INCORPORATED BY REFERENCE
The following documents have been filed by the Company with the Commission
and are hereby incorporated by reference in this Prospectus: (i) the Annual
Report of the Company on Form 10-K for the year ended December 31, 1994; (ii)
the Quarterly Reports of the Company on Form 10-Q for the quarters ended March
31, June 30, and September 30, 1995; and (iii) the description of the Company's
Common Stock contained in its Registration Statement pursuant to Section 12 of
the Exchange Act, as amended from time to time. All other documents and reports
filed by the Company with the Commission pursuant to Sections 13, 14, or 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of this offering of the Common Stock shall be deemed to be
incorporated by reference in this Prospectus and to be made a part hereof from
their respective dates of filing.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document that is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will cause to be furnished without charge to each person,
including any beneficial owner, to whom this Prospectus is delivered, upon the
written or oral request of such person, a copy of any and all documents
incorporated herein by reference (not including the exhibits to such documents,
unless such exhibits are specifically incorporated by reference in the document
which this Prospectus incorporates). Requests should be directed to the
Company's principal executive offices at 7001 North Scottsdale Road, Suite 1000,
Scottsdale, Arizona 85253-3644; telephone: (602) 596-4300; attn: Mark R.
Schonau, Chief Financial Officer -- Secretary/Treasurer.
2
<PAGE> 4
RISK FACTORS
THE PURCHASE OF THE COMMON STOCK OFFERED HEREBY INVOLVES SUBSTANTIAL RISK.
THE FOLLOWING MATTERS, INCLUDING THOSE MENTIONED ELSEWHERE, SHOULD BE CONSIDERED
CAREFULLY BY A PROSPECTIVE INVESTOR IN EVALUATING A PURCHASE OF THE COMMON
STOCK.
Variability of Quarterly Operating Results; Seasonality. The Company's
revenues and operating results can vary significantly from quarter to quarter as
a result of a number of factors, including the volume and timing of systems
sales and installations and product deliveries from the Company's vendors. The
timing of such revenues from systems sales is difficult to forecast because the
Company's sales cycle can vary depending upon factors such as the size of the
transaction and general economic conditions. Because a significant percentage of
the Company's expenses are relatively fixed, a variation in the timing of
systems sales can cause significant variations in operating results from quarter
to quarter. The Company's future operating results may fluctuate as a result of
these and other factors, such as customer purchasing patterns and the timing of
new product and service introductions and product upgrade releases. In addition,
the Company's revenues from system sales have historically followed seasonal
patterns with a lower level of sales occurring in the first quarter of the year
and a greater level of sales occurring in the fourth quarter of the year.
Uncertainty in Healthcare Industry; Government Healthcare Reform
Proposals. The healthcare industry is subject to changing political, economic
and regulatory influences that may affect the procurement practices and
operation of healthcare facilities. During the past several years, the
healthcare industry has been subject to an increase in governmental regulation
of, among other things, reimbursement rates and certain capital expenditures.
Many lawmakers have announced that they intend to propose programs to reform the
U.S. healthcare system. These programs may contain proposals to increase
governmental involvement in healthcare, lower reimbursement rates, and otherwise
change the operating environment for the Company's customers. Healthcare
providers may react to these proposals and the uncertainty surrounding such
proposals by curtailing or deferring investments, including those for the
Company's products and related services. Cost-containment measures instituted by
healthcare providers as a result of regulatory reform or otherwise could result
in greater selectivity in the allocation of capital funds. Such selectivity
could have an adverse effect on the Company's ability to sell its products and
related services. The Company cannot predict with any certainty what impact, if
any, such proposals or healthcare reforms might have on its business, financial
condition, and results of operations.
Competition. The Company faces significant competition from a number of
different sources. Physician practice management systems are offered to
physicians by competitors of the Company, including software vendors, systems
integrators, and computer hardware manufacturers. Data processing organizations
also compete with the Company by providing computerized billing, claims
processing, and record management services to medical offices. In addition,
healthcare reform, cost containment efforts, and other developments in the
healthcare market are causing new computer-based systems to be developed to
automate and make more efficient the methods for recording and paying healthcare
claims. Certain claims processing organizations, hospitals, third-party
administrators, hospital systems organizations, insurers, banks, and a variety
of healthcare organizations now provide computer and/or other electronic data
transmission systems, which sometimes include medical office management
software, to physicians which provide a direct data-link between the physician
and the organization. Also, other firms may seek to establish competitive
networks linking physicians electronically with a variety of healthcare
organizations. The opportunities to sell practice management systems and to
provide claims processing and related services to large healthcare providers
such as hospitals, health maintenance organizations, and preferred provider
organizations could attract significant additional competition to the market.
While management believes that no vendor dominates the overall market for
physician practice management systems and no service provider dominates the
overall market for claims processing services, certain of the Company's existing
and potential competitors have substantially greater resources than the Company.
Accordingly, there can be no assurance that the Company will be able to compete
successfully with its competitors in the future.
New Products and Services; Technological Changes. The market for physician
practice management systems is characterized by continual change and improvement
in computer hardware and software
3
<PAGE> 5
technology, as well as in services. Although the Company believes that its
products and services continue to be competitive in the marketplace, the Company
intends to continue to upgrade and enhance its products and services. The
Company's success will depend upon the Company's ability to enhance its current
products and services, to introduce new products and services which keep pace
with technological and market developments, and to address the increasingly
sophisticated needs of its customers. There can be no assurance that the Company
will be successful in developing, marketing, and/or licensing from third
parties, on a timely basis, product or service enhancements or new products or
services that respond to advances by others, or that its new products or
services will adequately address the needs of, or be accepted by, the market.
Market and Product Concentration. The Company would be materially
adversely affected by an overall decline or other material change in the market
for physician practice management systems and for claims processing services.
During the nine-month period ending September 30, 1995, approximately 36% of the
Company's net revenues were derived from sales of the CS3000 and related
products and from claims processing services. There can be no assurance that
sales levels of the CS3000 and the revenue from claims processing will increase
or be sustained.
Acquisitions. The Company's expansion strategy involves the acquisition of
complementary businesses, products, services, and technologies, as well as
internal growth. There can be no assurance, however, that any future
acquisitions will not have an adverse effect upon the Company's operating
results, particularly immediately following the consummation of such
transactions when the operations of the acquired business are being integrated
into the Company's operations.
Product Liability. Certain of the Company's products provide applications
that relate to patient medical histories and treatment plans. Any failure by the
Company's products to provide accurate and timely information could result in
claims against the Company. The Company maintains insurance to protect against
claims associated with the use of its products, but there can be no assurance
that its insurance coverage would adequately cover any claim asserted against
the Company. A successful claim brought against the Company in excess of its
insurance coverage could have a material adverse effect on the Company's
business, financial condition, and results of operations. Even unsuccessful
claims could result in the Company's expenditure of funds in litigation, as well
as diversion of management time and resources. There can be no assurance that
the Company will not be subject to product liability claims, that such claims
will not result in liability in excess of its insurance coverages, that the
Company's insurance will cover such claims, or that appropriate insurance will
continue to be available to the Company in the future at commercially reasonable
rates.
Dependence on Proprietary Technology. The Company relies on a combination
of the trade secret, copyright and trademark laws, nondisclosure and other
contractual provisions, and technical measures to protect its proprietary rights
in its products. There can be no assurance that these protections will be
adequate or that the Company's competitors will not independently develop
technologies that are substantially equivalent or superior to the Company's
technology. Although the Company believes that its products, trademarks, and
other proprietary rights do not infringe upon the proprietary rights of third
parties, there can be no assurance that third parties will not assert
infringement claims against the Company in the future.
Dependence on Key Personnel. The success of the Company is dependent to a
significant degree on its key management and technical personnel, including its
Chairman of the Board of Directors, President and Chief Executive Officer, Jim
H. Houtz. The Company believes that its continued future success will also
depend upon its ability to attract, motivate, and retain highly-skilled
technical, managerial, and marketing personnel. Competition for such personnel
in the software systems integration industry is intense. The loss of key
personnel or the inability to hire or retain qualified personnel could have a
material adverse effect on the Company's business, financial condition, and
results of operations. Although the Company has been successful to date in
attracting and retaining skilled personnel, there can be no assurance that the
Company will continue to be successful in attracting and retaining the personnel
it requires to successfully develop new and enhanced products and to continue to
grow and operate profitably.
Possible Volatility of Stock Price. The stock market has from time to time
experienced extreme price and volume fluctuations, particularly in the high
technology sector, which have often been unrelated to the operating performance
of particular companies. In addition, factors such as announcements of
technological
4
<PAGE> 6
innovations or new products by the Company or its competitors or third parties,
as well as market conditions in the computer software or hardware industries,
may have a significant impact on the market price of the Common Stock.
Effect of Certain Certificate of Incorporation Provisions. The Company's
Certificate of Incorporation contains certain provisions that could have the
effect of making it more difficult for a third party to acquire, or of
discouraging a third party from attempting to acquire, control of the Company.
Such provisions could limit the price that certain investors might be willing to
pay in the future for shares of the Common Stock. In addition, the Company has
entered into a Shareholder Rights Agreement that could have the effect of
discouraging a third party from attempting to acquire control of the Company.
RECENT DEVELOPMENTS
On December 21, 1995, the Company announced a one-time $3.8 million
technology charge related primarily to previously developed software technology
the Company will replace with more advanced products. The most significant
portion of the charge relates to the Company's previously developed medical
records technology, which will be replaced by a more advanced product licensed
from Wang Laboratories, Inc. through a marketing services agreement entered into
earlier this year. Another significant portion of the charge relates to a main
frame version of the CS3000, which the Company has determined will not be viable
in a client-server environment. The charge will result in a loss for the quarter
ended December 31, 1995.
USE OF PROCEEDS
All 21,430 shares of Common Stock offered hereby are being offered by the
Selling Stockholder. The Company will not receive any proceeds from the sale of
Common Stock by the Selling Stockholder.
SELLING STOCKHOLDER
On December 1, 1995, Richard D. Jugel Company ("Jugel") merged with and
into the Company pursuant to an Agreement of Merger, dated December 1, 1995 (the
"Agreement"). At the time of the merger, the Selling Stockholder owned all of
the issued and outstanding shares of the capital stock of Jugel. Under the terms
of the Agreement, Selling Stockholder's shares of Jugel common stock were
automatically cancelled and extinguished and were converted into 21,430 shares
of the Company's Common Stock. Under the Agreement, the Company is required to
register for public sale those shares of Common Stock issued to Selling
Stockholder. This Prospectus is a part of the Registration Statement filed by
the Company in order to satisfy this requirement. In addition, in connection
with the Agreement, the Company entered into a four-year Employment Agreement
with Selling Stockholder and Selling Stockholder executed a Non-Competition
Agreement in favor of the Company.
The following table provides certain information with respect to the Common
Stock owned by the Selling Stockholder as of December 29, 1995.
<TABLE>
<CAPTION>
PERCENTAGE OF PERCENTAGE OF
NO. OF SHARES COMMON STOCK COMMON SHARES
OF COMMON OWNED PRIOR TO NO. OF COMMON OWNED AFTER THE
STOCK OWNED OFFERING(1) SHARES OFFERED OFFERING(2)
------------------- ------------------- ------------------- -------------------
<S> <C> <C> <C>
21,430 0.43% 21,430 0%
</TABLE>
- ---------------
(1) Includes all shares of Common Stock beneficially owned by the Selling
Stockholder as a percentage of the 5,030,888 shares of Common Stock
outstanding at December 29, 1995.
(2) Assumes that Selling Stockholder disposes all of the shares of Common Stock
covered by this Prospectus and does not acquire any additional shares of
Common Stock.
5
<PAGE> 7
PLAN OF DISTRIBUTION
This Prospectus relates to the sale of 21,430 shares of Common Stock by
Selling Stockholder. The Selling Stockholder may from time to time effect sales
of Common Stock in one or more transactions pursuant to Rule 144 under the
Securities Act, in privately negotiated transactions, or in ordinary broker's
transactions on the New York Stock Exchange, at the price prevailing at the time
of such sales, at prices relating to such prevailing market prices, or at
negotiated prices. It is anticipated that any broker-dealers participating in
such sales of securities will receive the usual and customary selling
commissions.
The Company will pay all of the expenses incident to the registration of
the Common Stock offered hereby, other than commissions and selling expenses
with respect to the Common Stock being sold by the Selling Stockholder.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for the
Company by Snell & Wilmer L.L.P., One Arizona Center, Phoenix, Arizona 85004.
EXPERTS
The consolidated financial statements of CyCare Systems, Inc. incorporated
by reference in CyCare Systems, Inc.'s Annual Report (Form 10-K) for the year
ended December 31, 1994, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon incorporated by reference therein
and incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
6
<PAGE> 8
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NO DEALER, SALESPERSON, OR OTHER PERSON HAS BEEN AUTHORIZED IN CONNECTION
WITH THIS OFFERING TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER
THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE
HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY BY ANYONE IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. 2
Information Incorporated by
Reference........................... 2
Risk Factors.......................... 3
Recent Developments................... 5
Use of Proceeds....................... 5
Selling Stockholder................... 5
Plan of Distribution.................. 6
Legal Matters......................... 6
Experts............................... 6
</TABLE>
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CYCARE
SYSTEMS, INC.
21,430
SHARES
OF
COMMON STOCK
------------------------
PROSPECTUS
------------------------
, 1996
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<PAGE> 9
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee................ $ 174
Printing and Engraving Expenses.................................... $ 1,500
Legal Fees and Expenses............................................ $20,000
Accounting Fees and Expenses....................................... $ 8,000
Blue Sky Fees and Expenses......................................... $ 2,000
Other Expenses..................................................... $ 1,826
-------
Total Expenses................................................... $33,500
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Reference is made to Section 145 of the Delaware General Corporation Law
(the "Delaware GCL"), as amended from time to time ("Section 145"), which
provides for indemnification of directors and officers of a corporation in
certain circumstances. Under Article VIII of the registrant's Restated
Certificate of Incorporation, as amended, the registrant shall, to the full
extent permitted by Section 145, indemnify all persons whom it may indemnify
pursuant thereto. Additionally, Article VIII provides, among other matters, that
the right to indemnification is a contract right, that the registrant is
expressly authorized to procure insurance, that advancements of expenses by the
registrant is mandatory (except as limited by law), and for certain procedural
mechanisms for the benefit of indemnified parties.
Section 5.2 of the By-Laws of the registrant provides for indemnification
of directors and officers of the registrant. The provisions of Section 5.2,
among other matters, require the registrant to indemnify certain persons to the
fullest extent authorized by the Delaware GCL, as the same may now exist or may
hereafter be amended. Section 5.2 provides that such indemnification is not
exclusive of any other rights under, for example, an indemnity contract, or a
vote of shareholders or disinterested directors. Such indemnification rights
continue as to any person who has ceased to be a director or officer and inure
to the benefit of the person's heirs, executors, and administrators.
The registrant currently maintains directors' and officers' liability
insurance to supplement the protection provided in the registrant's By-Laws and
to fund any indemnification payments that the registrant may be required to
make. Such insurance is renewable annually and is subject to standard terms and
conditions, including exclusions from coverage.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ---- --------------------------------------------------------------------
<S> <C>
4.1 Restated Certificate of Incorporation(1)
4.2 By-Laws(1)
4.3 The Shareholder Rights Agreement dated May 15, 1989(2)
5 Opinion of Snell & Wilmer L.L.P.
23.1 Consent of Ernst & Young LLP
23.2 Consent of Snell & Wilmer L.L.P. (included in Exhibit 5)
24 Powers of Attorney (included on signature page)
</TABLE>
- ---------------
(1) Incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended December 31, 1988.
(2) Incorporated by reference to the Company's Report on Form 8-K, dated May 9,
1989.
II-1
<PAGE> 10
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act 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. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in 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) of this section
do not apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the registrant pursuant to Section 13 or
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
therein, 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.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described in Item 15 above, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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.
II-2
<PAGE> 11
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Scottsdale, State of Arizona, on December 29, 1995.
CYCARE SYSTEMS, INC.,
a Delaware corporation
By: /s/ Jim H. Houtz
------------------------------------
Jim H. Houtz
Chairman of the Board, President and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Jim H. Houtz and Mark R. Schonau, and each of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for and in his name, place, and stead, in any
and all capacities, to sign any and all amendments to this Form S-3 Registration
Statement, and any Registration Statement and any amendment thereto pursuant to
Rule 462(b) under the Securities Act for this offering, and to file the same,
with all exhibits thereto, and other documents in connection therewith with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully and to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ----------------------------------- -------------------------------------- ------------------
<S> <C> <C>
/s/ Jim H. Houtz Chairman of the Board, President and December 29, 1995
- ----------------------------------- Chief Executive Officer (Principal
Jim H. Houtz Executive Officer)
/s/ Mark R. Schonau Chief Financial Officer, Secretary and December 29, 1995
- ----------------------------------- Treasurer (Principal Financial and
Mark R. Schonau Accounting Officer)
/s/ James L. Schamadan, M.D. Director December 29, 1995
- -----------------------------------
James L. Schamadan, M.D.
/s/ Frank H. Bertsch Director December 29, 1995
- -----------------------------------
Frank H. Bertsch
/s/ Richard J. Burgmeier Director December 29, 1995
- -----------------------------------
Richard J. Burgmeier
Director December , 1995
- -----------------------------------
A. Theodore Engkvist
</TABLE>
II-3
<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ --------------------------------------------------------------------
<S> <C>
4.1 Restated Certificate of Incorporation(1)
4.2 By-Laws(1)
4.3 The Shareholder Rights Agreement dated May 15, 1989(2)
5 Opinion of Snell & Wilmer L.L.P.
23.1 Consent of Ernst & Young LLP
23.2 Consent of Snell & Wilmer L.L.P. (included in Exhibit 5)
24 Powers of Attorney (included on signature page)
</TABLE>
- ---------------
(1) Incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended December 31, 1988.
(2) Incorporated by reference to the Company's Report on Form 8-K, dated May 9,
1989.
<PAGE> 1
EXHIBIT 5
December 29, 1995
CyCare Systems, Inc.
7001 North Scottsdale Road, Suite 1000
Scottsdale, Arizona 85253-3644
RE: REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-3, including
amendments and exhibits thereto (the "Registration Statement") and any
registration statement registering additional Common Stock pursuant to Rule
462(b) of the Securities Act of 1933, as amended, that relates to the
Registration Statement (the "Rule 462(b) Registration Statement"), for the
proposed offer and sale of up to 21,430 shares of Common Stock (the "Shares") of
CyCare Systems, Inc. (the "Company"), by Mr. Richard D. Jugel, it is our opinion
that the Shares are validly issued, fully paid, and nonassessable.
In rendering this opinion, we have examined the Restated Certificate of
Incorporation, as amended, and the Bylaws, as amended, of the Company, the
Certificate of Merger of Richard D. Jugel and Company into CyCare Systems, Inc.
(the "Certificate of Merger"), the proceedings of the Board of Directors of the
Company authorizing the Certificate of Merger, and such other documents and
records of the Company as we have deemed necessary. In addition, we have assumed
the following:
(i) the genuineness of all signatures and the authenticity of documents
submitted to us as originals, and the conformity to originals of all documents
submitted to us as copies;
(ii) the accuracy, completeness, and genuineness of all representations and
certifications, with respect to factual matters, made to us by officers of the
Company and public officials; and
(iii) the accuracy and completeness of Company records.
The opinions expressed herein are based upon the law and other matters in
effect on the date hereof, and we assume no obligation to revise or supplement
this opinion should such law be changed by legislative action, judicial
decision, or otherwise, or should any facts or other matters upon which we have
relied be changed.
This opinion is intended solely for the use of the Company in connection
with the registration of the Shares. It may not be relied upon by any other
person or for any other purpose, or reproduced or filed publicly by any person
without the prior written consent of this firm; provided, however, consent is
hereby given to the use of this opinion as part of the Registration Statement
and the Rule 462(b) Registration Statement, if applicable, and to the use of our
name wherever it appears in said Registration Statement and the Rule 462(b)
Registration Statement, if applicable.
Very truly yours,
SNELL & WILMER L.L.P.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of CyCare Systems, Inc.
for the registration of 21,430 shares of its common stock and to the
incorporation by reference therein of our reports dated February 17, 1995, with
respect to the consolidated financial statements of CyCare Systems, Inc.
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1994, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Phoenix, Arizona
December 28, 1995
