As filed with the Securities and Exchange Commission on February 19, 1997
Registration No.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SANDATA, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 11-2841799
(State or Other Jurisdiction (I.R.S. Employer Identification
of Incorporation) Number)
26 Harbor Park Drive
Port Washington, New York 11050
(516) 484-9060
(Address, Including Zip Code, and Telephone Number, Including Area
Code, of Registrant's Principal Executive Offices)
Bert E. Brodsky
President
Sandata, Inc.
26 Harbor Park Drive
Port Washington, New York 11050
(516) 484-9060
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
Copies of all communications and notices to:
Steven J. Kuperschmid, Esq.
Certilman Balin Adler & Hyman, LLP
90 Merrick Avenue
East Meadow, New York 11554
(516) 296-7000
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 of the Securities Act of
1933, check the following box. [x](Cover continued on following page)
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. [ ]
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
Proposed Maximum Proposed Maximum Amount of
Title of Each Amount to be Offering Price Aggregate Offering Registra-
Class of Securities Registered (1) Per Share (2) Price (2) tion Fee
to be Registered
<S> <C> <C> <C> <C>
Common Stock, 1,088,140 $10.00 $10,088,140 $3,056.71
$.001 Par Value,
registered for the
benefit of Selling
Stockholders
<FN>
<F1>
This Registration Statement also covers such additional number of shares of
Common Stock as may be issuable by reason of the operation of the
antidilution provisions of certain outstanding transferable warrants.
<F2>
Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c).
</FN>
</TABLE>
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Securities and Exchange
Commission acting pursuant to said Section 8(a), may determine.
Subject to Completion
Preliminary Prospectus Dated February 19, 1997
PROSPECTUS
COMMON SHARES
SANDATA, INC.
This Prospectus relates to 1,088,140 shares of Common Stock (the "Shares") of
Sandata, Inc. (the "Company"). This Prospectus covers: (i) the resale by
certain individuals and entities of up to an aggregate of 300,000 Shares issued
by the Company pursuant to Subscription Agreements dated as of December 23,
1996, (ii) the resale by certain persons of up to an aggregate of 100,000
Shares issued by the Company pursuant to Subscription Agreements dated as
of September 13, 1996, (iii) the resale by certain Directors and executive
officers of the Company of up to an aggregate of 338,140 Shares, and (iv)
the resale by certain individuals and entities of up to an aggregate of
350,000 shares issuable upon the exercise of outstanding warrants.
The various persons and entities referred to herein, are hereinafter referred
to individually as a "Selling Stockholder" and collectively as the "Selling
Stockholders". The Company will receive no proceeds upon the resale of the
Shares by such persons and entities. There are no commitments pursuant to
which the Company will receive any proceeds from the resale of the Shares by
the Selling Stockholders. See "Selling Stockholders."
To the Company's knowledge, the Selling Stockholders, directly through
agents designated by them from time to time or through broker-dealers or
underwriters also to be designated, may sell the Shares from time to time, in
or through privately negotiated transactions, or in one or more transactions,
including block transactions, on the NASDAQ Small Cap Market, or on any other
market or stock exchange on which the Shares may be listed in the future
pursuant to and in accordance with the applicable rules of such market or
exchange or otherwise. The selling price of the Shares may be at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. See "Selling Stockholders" and "Plan
of Distribution".
The Company has agreed to indemnify certain of the Selling Stockholders
against certain civil liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). See "Selling
Stockholders" and "Plan of Distribution".
The Selling Stockholders and any agents, broker-dealers, or underwriters that
participate with the Selling Stockholders in the distribution of any of the
Shares may be deemed to be "underwriters" within the meaning of the
Securities Act, and any commissions received by them, and any profit on the
resale of the Shares purchased by them, may be deemed to be underwriting
commissions or discounts under the Securities Act. The Company is not aware
of any underwriting arrangements with respect to the resale of the Shares
by the Selling Stockholders. See "Selling Stockholders" and "Plan of
Distribution".
A PURCHASE OF THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" (PAGE 4).
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANYREPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The Company's Common Stock is traded on the NASDAQ SmallCap Market under the
symbol "SAND". On February 18, 1997, the closing bid price for the Company's
Common Stock, as reported by NASDAQ SmallCap Market, was $9.50.
February 19, 1997
No dealer, salesman or any other person has been authorized to give any
information or to make any representation not contained in this prospectus
and, if given or made, such information or representation must not be
relied upon as having been authorized by the company or any other person.
This prospectus does not constitute an offer to sell or a solicitation of an
offer to buy to anyone in any jurisdiction in which such offer or solicitation
is not authorized or in which the person making such offer or solicitation is
not qualified to do so, or to anyone to whom it is unlawful to make such
offer or solicitation. Neither the delivery of this prospectus nor any sale
made hereunder shall, under any circumstances, create any implication that
any information contained herein is correct as of any time subsequent to the
date hereof.
AVAILABLE INFORMATION
The Company files reports, proxy and information statements and other
information with the Securities and Exchange Commission (the "Commission").
Such reports, statements and other information filed by the Company with the
Commission can be inspected and copied at the public reference facilities
maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the following Regional Offices of the
Commission: 7 World Trade Center, Suite 1300, New York, New York 10048; and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material can also be obtained from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Furthermore, the Commission
maintains a Web site that contains reports, proxy and information statements
and other information regarding the Company. The address of such Web site
is http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by the Company with the Commission
under the Securities Exchange Act of 1934, as amended (the "1934 Act") and
are incorporated herein by reference:
(a)The Company's Annual Report on Form 10-KSB as amended for the fiscal year
ended May 31, 1996 (the "Form 10-KSB").
(b)The Company's Quarterly Report on Form 10-QSB, as amended, for the period
ended August 31, 1996.
(c)The Company's Quarterly Report on Form 10-QSB, as amended, for the period
ended November 30, 1996 (the "November 10-QSB").
(d)The description of the Company's Common Stock contained in the Company's
Registration Statement on Form 8(a), as amended.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the 1934 Act after the date of this Prospectus and prior to the
termination of the offering of the Shares offered hereby shall be deemed to
be incorporated by reference into this Prospectus and to be a part hereof
from their respective dates of filing.
The Company will provide without charge to each person to whom a copy of this
Prospectus is delivered, upon the written or oral request of any such person,
a copy of any or all of the documents referred to above which have been
incorporated into this Prospectus by reference (other than exhibits to such
documents). Requests for such copies should be directed to the Secretary,
Sandata, Inc., 26 Harbor Park Drive, Port Washington, New York 11050
(telephone number: (516) 484-9060).
Any statement contained in a document incorporated herein by reference shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
THE COMPANY
The Company, through its wholly-owned subsidiaries, is engaged in the
business of providing computerized data processing services and custom
software and programming services, by utilizing Company-developed software,
and software acquired or licensed by the Company, principally to the health
care industry, but also the general commercial market. In addition, the
Company provides hardware maintenance of personal computers ("PCs"), printers
and networks and training on PC software packages.
Applications of the Company's software include: a home health care system,
computerized preparation of management reports, payroll processing and
electronic time card with voice recognition systems. Principal products and
services provided by the Company include the Sandsport Home Attendant
Reporting Program, data entry services and specialized system development,
among others. In addition, the Company provides administration and
processing services for an affiliate engaged in the pharmacy prescription
reimbursement business.
Generally, in providing data processing services, the Company first receives
data from its customers, then processes it and generates reports based on
such data. Services are provided to customers by processing on the Company's
equipment at its premises. The Company also has available software which
permits information retrieval from customers' facilities which communicate with
the Company's computers at its data center. This allows the Company's
customers to have access to processing hardware and software without a
substantial investment on their part. The Company also offers its services on
a turnkey basis. Turnkey computer systems offer the customer total in-house
capabilities through the licensing of the Company's software for use on a
customer's computer. The Company's software is written in a variety of
software languages including COBOL, C and FoxPro.
Over the past several years, the Company has developed its Santrax product,
a computerized time and attendance management system. The Santrax system
utilizes voice recognition and telecommunications technology to verify that a
person is at a particular telephone number at a particular time. Presently,
the system is being utilized by several of the Company's home health care
clients, with the Company receiving approximately an aggregate of 400,000
calls per week. Although no assurances can be given, it is anticipated that
the Santrax product can be utilized by other industry applications.
The Company was incorporated in the State of New York in June 1978 and
reincorporated in the State of Delaware in December 1986, at which time it
also assumed its present name.
The Company maintains its executive offices at 26 Harbor Park Drive, Port
Washington, New York 11050; telephone number (516) 484-9060.
FORWARD-LOOKING STATEMENTS
The Company cautions readers that certain important factors may affect the
Company's actual results and could cause such results to differ materially
from any forward-looking statements which may be deemed to have been made in
this Prospectus or which are otherwise made by or on behalf of the Company.
For this purpose, any statements contained in this Prospectus that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the generality of the foregoing, words such as "may",
"will", "expect", "believe", "anticipate", "intend", "could", "estimate",
or "continue" or the negative other variations thereof or comparable
terminology are intended to identify forward-looking statements. Factors
which may effect the Company's results include, but are not limited to, the
risks and uncertainties associated with data processing and system sales.
The Company is also subject to other risks detailed herein or detailed from
time to time in the Company's Commission filings. Factors that could cause or
contribute to such difference include, but are not limited to, those discussed
in "Risk Factors" below, as well as those discussed elsewhere in this
Prospectus and in the Company's filings with the Commission.
RISK FACTORS
An investment in the securities offered hereby is speculative and involves a
high degree of risk and should only be purchased by investors who can afford
to lose their entire investment. Prospective purchasers, prior to making an
investment, should carefully consider the following risks and speculative
factors, as well as other information set forth elsewhere in this Prospectus.
This Prospectus contains, in addition to historical information, forward-
looking statements that involve risks and uncertainties. The Company's
actual results could differ materially. Factors that could cause or
contribute to such difference include, but are not limited to, those
discussed below, as well as those discussed elsewhere in this Prospectus.
1.Dependence on Governmental Program.
For its fiscal years ended May 31, 1996 and 1995, and fiscal six month period
ended November 30, 1996 and 1995, approximately 51%, 61%, 77% and 62%,
respectively, of the Company's revenues were derived from data processing and
other related services rendered to vendor agencies under contract with the
Human Resources Agency of the City of New York ("HRA"). Such vendor agencies
receive a substantial portion of their operating funds from the federal
government through its Medicaid program; the balance of their funding is
provided by the State and City of New York. Management believes that
operations will, for the foreseeable future, continue to be dependent upon
revenues generated from such vendor agencies. Elimination of the home
attendant services program by HRA or a substantial cut-back in the level of
funding of this program by the federal, state or city governments would have,
through the impact of such cut-backs on the vendor agencies, a material adverse
effect on the Company. See "Item 1 - Description of Business - Principal
Products and Services" in the Form 10-KSB.
2.Technological Obsolescence.
The data processing and computer software fields are characterized by rapid
technological developments and advances, often resulting in partial or total
obsolescence of systems. There is no assurance that the Company's research
and development activities will permit it to keep abreast of new developments.
See "Item 1 - Description of Business - Research and Development" in the Form
10-KSB.
3.Competition.
Some of the Company's competitors are larger and have greater financial
resources than the Company. Furthermore, the Company's customers may find it
desirable to perform for themselves the services being rendered by the Company.
The Company also competes with larger and better established companies for
the hiring of qualified technical and marketing personnel. See "Item 1 -
Description of Business - Competition" in the Form 10-KSB.
4.Proprietary Rights.
The Company does not own, nor has it applied for, Federal Copyright
registration on its computer software systems now in existence or being
developed. However, the Company believes that its computer software systems
are proprietary trade secrets and that they, together with the documentation,
manuals, training aids, instructions and other materials supplied by the
Company to customers, are subject to the proprietary rights of the Company and
protected by applicable law. However, there can be no assurance that the
Company will be able to protect itself against misappropriation of its
proprietary rights and trade secrets. See "Item 1 - Business - Proprietary
Rights" in the Form 10-KSB.
5.Control by Current Stockholders.
The Company's Certificate of Incorporation does not provide for
cumulative voting. Therefore, stockholders owning in excess of 50%
of the outstanding shares of the Company's Common Stock are able to
elect all the members of the Board of Directors. Therefore, upon the
completion of this Offering, the present management of the Company,
who will own in the aggregate 44.5% (calculated in accordance with
Rule 13d-3 of the Securities and Exchange Act of 1934, as amended) of
the outstanding shares of the Company's Common Stock, will be able to
elect all of the Company's directors and to control the Company.
6.Effect of Outstanding Exercisable Securities.
As of the date of this Prospectus, the Company had currently
exercisable outstanding options and warrants to purchase shares of
the Company's Common Stock exercisable at various prices from $1.38
to $7.00, subject to adjustment per share, pursuant to which an
aggregate of 1,216,927 shares of Common Stock (subject to adjustment)
may be issued. This includes warrants granted to the Company's
Chairman and options granted to various directors, officers,
employees and consultants.
During the respective terms of the Company's outstanding derivative
securities, the holders thereof may be able to purchase shares of
Common Stock at prices substantially below the then-current market
price of the Company's Common Stock with a resultant dilution in the
interests of the existing stockholders. In addition, the exercise of
outstanding derivative securities and the subsequent public sales of
Common Stock by holders of such securities pursuant to a registration
statement effected at their demand, under Rule 144 or otherwise,
could have an adverse effect upon the market for and price of the
Company's securities.
7.Shares Eligible for Future Sale May Adversely Affect the Market.
870,420 of the Company's outstanding shares of Common Stock are
"restricted securities" and, in the future, may be sold upon
compliance with Rule 144 or pursuant to registration (effected by
demand or other rights granted to certain stockholders) under the
Act. Rule 144 currently provides, in essence, that a person holding
"restricted securities" for a period of two years may sell an amount
every three months up to the greater of (a) 1% of the Company's
issued and outstanding securities of that class of securities or (b)
the average weekly volume of sales of such securities during the four
calendar weeks preceding the sale if there is adequate current public
information available concerning the Company. Additionally, non-
affiliates (who have not been affiliates of the Company for at least
three months) may sell their "restricted securities" in compliance
with Rule 144 without volume limitations after they have held such
securities for a period of three years. An aggregate of
531,381 shares of Common Stock have been owned by Messrs. Brodsky,
Freund and Stoller for more than two years. However, such shares are
subject to an agreement with Barber & Bronson Incorporated ("B&B")
imposing certain restrictions on the public sale thereof until
December 22, 1997 without B&B's consent. B&B has authorized Messrs.
Brodsky, Freund and Stoller to sell an aggregate of 100,000 of such
shares and has verbally advised the Company that it intends to
authorize the sale of an additional 238,140 Shares as contemplated by
this Prospectus.
The Company is registering for resale 738,140 Shares held by certain
stockholders. In addition, the Company is registering for resale the
350,000 Shares underlying certain warrants. Such Shares may be
resold at any time following the date of this Prospectus.
Prospective investors should be aware that the possibility of resales
by the Selling Stockholders, as well as other stockholders of the
Company, may have a material depressive effect on the market price of
the Company's shares of Common Stock in any market which may develop.
8.Ability to Renew Present Financing.
From time to time the Company has entered into loan arrangements with
Marine Midland Bank (the "Bank"), among others. As of November 30,
1996, the Company owed the Bank $704,154. Although in the past the
Bank has renewed its loans to the Company when they matured, there
can be no assurance that it will continue to do so or that the
Company, if the Bank does not renew the loan, will be able to arrange
alternative financing on terms satisfactory to it.
9.Significant Outstanding Indebtedness; Loan Covenants and Security
Interests.
In order to finance the Company's capital requirements, the Company
incurred substantial indebtedness in relation to its equity capital.
Of the Company's total outstanding indebtedness of $3,007,985, at
November 30, 1996, $704,154 was outstanding under the Company's
Revolving Credit and Term Loan Agreement (the "Credit Agreement")
with the Bank. Pursuant to the Credit Agreement, the Company may
borrow up to $2.5 million. Amounts outstanding under the Credit
Agreement were due and payable on February 10, 1995; however, on
April 20, 1995, the Credit Agreement with the Bank was amended,
extending the due date to April 20, 1997. Upon maturity, the Company
may, at its option, convert the then-outstanding principal balance of
the advances under the Credit Agreement into a five year term loan
payable in sixty equal monthly principal installments, plus interest
at 3/4 percent above the Bank's prime rate. Also, on April 20, 1995, a two
year loan (the "Term Loan") in the amount of $500,000 was advanced by
the Bank to the Company. The Term Loan is payable in 24 monthly
principal installments of $20,834, plus interest at 3/4 percent above the
Bank's prime rate, through April 1997. All of the Company's assets
are pledged to the Bank as collateral for the amounts due under the
Credit Agreement. The Company is prohibited from incurring additional
indebtedness except under certain circumstances.
In addition, pursuant to the Credit Agreement, the Company is
required to maintain certain levels of net worth and meet certain
financial ratios. The Company has, in the past, failed to meet these
net worth and financial ratios, and the Bank has granted the Company
waivers. No assurance can be given that the Company will be able to
meet these net worth and financial requirements in the future, and/or
that the Bank will continue to grant to the Company waivers. In
addition, the Company is indebted to companies affiliated with the
Company's Chairman in the amount, as of November 30, 1996, of $1,847,000.
Of this amount, as of November 30, 1996, an aggregate of $462,000 of
indebtedness was evidenced by notes due in December 1997 and May 1998.
As described in the November 10-QSB, the Company is a party to a
transaction with a company affiliated with the directors of the
Company and the Nassau County Industrial Development Agency (the
"NCIDA"), pursuant to which, among other things, the Company has
guaranteed certain obligations of such affiliate to the NCIDA and
subleases its office space from such affiliate. In addition, in
August, 1995 the Company entered into a loan transaction with the
Long Island Development Corporation, which loan is guaranteed by the
U.S. Small Business Administration (the "SBA Loan"). The
documentation with regard to each of the foregoing contain various
covenants requiring and/or restricting the Company from taking
various action. Among other things, the documentation relating to
the SBA Loan contains certain covenants which require certain
principal stockholders of the Company to maintain certain levels of
equity in the Company. Such restriction could impact the Company's
ability to engage in equity financings and a violation of such
covenant could result in a default under the SBA Loan. In the past,
the Company has been able to obtain a waiver of such provision,
however, no assurances can be made that it will continue to be able
to do so.
As of the date of this Prospectus, the Company has obtained a waiver
with regard to the Shares proposed to be sold by Messrs. Bert E.
Brodsky, Hugh Freund and Gary Stoller. Such waiver contemplates that
such individuals will exercise certain options and, therefore,
maintain certain levels of equity in the Company. Such individuals
have not committed to exercise such options, although they have
verbally advised the Company that they intend to do so.
10.Limited Marketing Capability.
The Company has limited marketing capabilities and resources. To
date, substantially all of the Company's commercial marketing
activities have been conducted by sales representatives directly
employed by the Company and independent sales agents. Such
activities have consisted primarily of personal contact with
potential customers. Because of the nature of the Company's
business, management will continue to devote a substantial amount of
time developing and maintaining continuing personal relationships
with the Company's customers. See "Item 1 - Description of Business
- - Marketing and Distribution" in the Form 10-KSB.
11.Dependence on Key Personnel.
The Company is dependent upon the expertise and abilities of three
key executive personnel: Bert E. Brodsky, Chairman of the Board,
President and Treasurer, Hugh Freund, Executive Vice President, and
Gary Stoller, Executive Vice President. The Company does not have
employment agreements with any of these officers; however, the
Company and Mr. Brodsky have agreed to enter into an employment
agreement by February 21, 1997. The Company's agreement with the
Bank requires that Mr. Brodsky at all times be active on a
substantially full-time basis in the affairs of the Company. The
Company or its subsidiaries is the beneficiary under certain key-man
life insurance policies on the life of each of Messrs. Brodsky and
Freund in the amounts of $4,500,000 and $1,400,000, respectively, the
benefits of which are payable to the Company. Of such insurance
benefits, an aggregate of $2,000,000 on the life of Mr. Brodsky has
been pledged to the Bank. However, if the Company were to lose the
services of any of these key personnel as a result of disability,
death or otherwise the Company could be in default under its
agreement with the Bank and its business could be adversely affected.
12.No Dividends.
To date, the Company has not paid any cash dividends on its Common
Stock and does not expect to declare or pay any cash or other
dividends in the foreseeable future. Dividends are restricted
pursuant to the terms of the Credit Agreement between the Company and
the Bank. See "Item 5 - Market for Common Equity and Related
Stockholder Matters - Dividend Policy" in the Form 10-KSB.
13. Unascertainable Risks Related to Possible Acquisitions. The
Company intends to explore opportunities to add, through acquisition
or licensing, technology or products to enhance or add to its current
product line, or to acquire a customer base or sales organization to
augment the Company's infrastructure. In exploring potential
acquisitions or licenses, the Company will consider, among other
criteria: the comparative cost to the Company in capital, resources
and personnel to create the identified technology or product, or to
establish the targeted customer base or sales organization;
restrictions to the Company developing similar technology or products
arising from patent or other intellectual property protection; and
the synergy of the identified technology or products, or customer
base or sales organization, with the Company's products and
organization. Although the Company anticipates it will follow the
foregoing general criteria in determining whether or not to make any
acquisitions, management will have sole discretion over whether or
not to engage in an acquisition. There can be no assurance that the
Company will identify any acquisition or licensing candidates or, if
it does, that it will be able to reach any agreements to acquire or
license technology or products, or acquire assets, on terms
acceptable to the Company. To the extent that the Company effects an
acquisition of technology or products in the early stage of
development or growth (including technology or products which have
not been fully tested or marketed), the Company will be subject to
numerous risks inherent in developmental technology and other high
level of risk associated with high technology industries based on
innovative technologies or processes. Furthermore, future
acquisition transactions may require the Company to obtain additional
financing from banks or financial institutions or to undertake debt
or equity financing. No assurance can be given that the Company
would be able to obtain financing upon commercially reasonable terms,
or at all. Furthermore, equity financing will result in a dilution
of existing Stockholders of the Company, which may be significant.
To the extent that debt financing ultimately proves to be available,
any borrowings may subject the Company to various risks traditionally
associated with the incurring of indebtedness, including the risks of
interest rate fluctuations and insufficiency of cash flow to pay
principal and interest. Although the Company will endeavor to
evaluate the risks inherent in a particular acquisition, there can be
no assurance that the Company will properly ascertain or assess such
significant risk factors.
14.Securities Market Factors.
In recent years, the securities markets have experienced a high level
of volume volatility and market prices for many companies,
particularly small and emerging growth companies, have been subject
to wide fluctuations in response to quarterly variations in operating
results. The securities of many of theses companies which trade in
the over-the-counter market, have experienced wide price
fluctuations, which in many cases were unrelated to the operating
performance of, or announcements concerning, the issuers of the
affected stock. Factors such as announcements by the Company or its
competitors concerning technological innovations, new products or
procedures, government regulations and developments or disputes
relating to proprietary rights may have a significant impact on the
market for the Company's securities. General market price declines
or market volatility in the future could adversely affect the future
price of the Company's securities.
<TABLE>
SELLING STOCKHOLDERS
The following table sets forth, as of February 18, 1997, to the
Company's knowledge, certain securities ownership information with
respect to the Selling Stockholders:
<CAPTION>
Common Shares Number of Common Common Shares
Name and Address Beneficially Shares Offered to be
Owned (1) for Sale Beneficially
Owned
After Offering(2)
- ---------------- ------------- ---------------- -----------------
Number Percent of
Outstanding
------ -----------
<S> <C> <C> <C> <C>
Bert E. Brodsky 686,435(3) 170,213(3) 516,222 31.8%
Hugh Freund 263,493(4) 105,696(4) 157,797 12.1%
Gary Stoller 232,786(5) 62,231(5) 170,555 13.2%
Steven N. Bronson 152,950(6) 152,950(6) -0- -0-
James S. Cassel 62,300(7) 62,300(7) -0- -0-
James S. Cassel
and Mindy Cassel,
TBTE 30,800(8) 30,800(8) -0- -0-
Keil Stern 30,000(9) 30,000(9) -0- -0-
Eric R. Elliot 8,900(10) 6,650(10) -0- -0-
Eric R. Elliott (IRA) 7,500(15) 7,500(15) -0- -0-
Barry J. Booth 6,650(11) 6,650(11) -0- -0-
Bruce C. Barber 6,650(12) 6,650(12) -0- -0-
Barry Steiner &
Lisa Steiner (JT) 5,750(13) 5,750(13) -0- -0-
Scott Salpeter 2,000(14) 2,000(14) -0- -0-
Leonard Adler 3,750(15) 3,750(15) -0- -0-
Hans Koenig Revocable
Living Trust (Hans &
Hanni Koenig)by agree-
ment 3/6/9 17,500(15) 7,500(15) -0- -0-
Paul Pesce 7,500(15) 7,500(15) -0- -0-
Amral Raul Ragoonanan 3,750(15) 3,750(15) -0- -0-
Peter David Bronson &
Maguy F. Bronson (JT) 7,500(15) 7,500(15) -0- -0-
Martin & Dolores
Elkin (JT) 7,500(15) 7,500(15) -0- -0-
Stephen Paul
Kregstein 3,750(15) 3,750(15) -0- -0-
Juetten Family Trust
(Richard Juetten,
Trustee) by agreement
dated 4/4/91 3,750(15) 3,750(15) -0- -0-
Kenneth B. Elias 3,750(15) 3,750(15) -0- -0-
Ronald A. David &
Dona C. David (TE) 3,750(15) 3,750(15) -0- -0-
Haguy Shechter 7,500(15) 7,500(15) -0- -0-
Nial Maura Ingerto 3,750(15) 3,750(15) -0- -0-
Ronald Richard
Fieldstone & Linda
Brady Fieldstone (TE) 7,500(15) 7,500(15) -0- -0-
Gordon Jay Dow (IRA) 7,500(15) 7,500(15) -0- -0-
James Allen Settlage
& Carol Lynn Settlage
(JT) 3,750(15) 3,750(15) -0- -0-
Paul Maurice Bronson
& Laura Mae Bronson
(JT) 7,500(15) 7,500(15) -0- -0-
Fern Susan Thaw 3,750(15) 3,750(15) -0- -0-
David Wayne Raisbeck
& Ellen Jane Raisbeck
(JT) 3,750(15) 3,750(15) -0- -0-
The Petersen Family
Trust(Norman W.
Petersen)by agreement
9/28/93 3,750(15) 3,750(15) -0- -0-
Margery Schwartz
(Cust for Evan
Schwartz NJ-UTMA) 3,750(15) 3,750(15) -0- -0-
Joseph Anthony
Spinella 3,750(15) 3,750(15) -0- -0-
David William Rogers 3,750(15) 3,750(15) -0- -0-
Craig Loren Silverman 3,750(15) 3,750(15) -0- -0-
Anthony Peter Conza 7,500(15) 7,500(15) -0- -0-
Jeffrey L. Thomas &
Sylvia H. Thomas (JT) 3,750(15) 3,750(15) -0- -0-
Howard Clifford Beach 3,750(15) 3,750(15) -0- -0-
Delaware Charter
Guarantee & Trust Co.
Custodian F/B/O Law
Offices Bruce Thaw
Keogh Plan 3,750(15) 3,750(15) -0- -0-
Sylvia Levine 3,750(15) 3,750(15) -0- -0-
Hal Kaufman 3,750(15) 3,750(15) -0- -0-
Leonard Goodfriend &
Audrey Goodfriend (JT)3,750(15) 3,750(15) -0- -0-
A.C. Brown 3,750(15) 3,750(15) -0- -0-
Frederick H. Fialkow 7,500(15) 7,500(15) -0- -0-
James A. Cook 3,750(15) 3,750(15) -0- -0-
Thomas A. Hanford Trust
(Thomas A. Hanford)
by agreement 5/17/96 7,500(15) 7,500(15) -0- -0-
S. Daniel Ponce (IRA 3,750(15) 3,750(15) -0- -0-
Yehuda Shechter 7,500(15) 7,500(15) -0- -0-
Effectenbank Stroeve
N.V. 7,500(15) 7,500(15) -0- -0-
Jeffrey Scott Roschman 7,500(15) 7,500(15) -0- -0-
Steven I. Levin 3,750(15) 3,750(15) -0- -0-
Frank T. Vicino, Jr. 3,750(15) 3,750(15) -0- -0-
Mark S. Schecter 3,750(15) 3,750(15) -0- -0-
Michael J. Bonner &
Deborah M. Bonner
(JT) 3,750(15) 3,750(15) -0- -0-
C.G. Chase Construction
Co. 7,500(15) 7,500(15) -0- -0-
John Raymond Prufeta 3,750(15) 3,750(15) -0- -0-
Richard S. Serbin &
Kathe Serbin 7,500(15) 7,500(15) -0- -0-
Zvika Shechter 3,750(15) 3,750(15) -0- -0-
George Andrew Solack 3,750(15) 3,750(15) -0- -0-
Sheldon Drobny 7,500(15) 7,500(15) -0- -0-
Susan Lambeth
Charitable Remainder
Unitrust (Susan Lambeth
and Edmuns Schupp)by
agreement 3/5/47 7,500(15) 7,500(15) -0- -0-
Mark Hart 11,250(15) 11,250(15) -0- -0-
David Brian Cohen 7,500(15) 7,500(15) -0- -0-
Robert Stuart Pearlman
& Rita Jo Pearlman
(JT) 3,750(15) 3,750(15) -0- -0-
Robbins, Tunkey, Ross,
Amsel, Raben and
Waxman, P.A.401K
Profit Sharing Trust
F/B/O William R.
Tunkey 3,750(15) 3,750(15) -0- -0-
Doran Topaz 3,750(15) 3,750(15) -0- -0-
Harvey Morton Soldan &
Ingrid Else Soldan (JT)7,500(15) 7,500(15) -0- -0-
The Beckham Family
Trust (David Beckham,
Trustee) - by agreement
dated 10/26/95 3,750(15) 3,750(15) -0- -0-
Boris Zalkind 3,750(15) 3,750(15) -0- -0-
7,500(15) 7,500(15) -0- -0-
Horst Siegfried
Filtzer 3,750(15) 3,750(15) -0- -0-
Charles G. Leaness 3,750(15) 3,750(15) -0- -0-
Lior Ben-Shmuel 7,500(15) 7,500(15 -0- -0-
Sonya Ben-Shmuel
Personal Revocable
Trust (Sonya Ben-Shmuel,
Trustee) - by agreement
dated 5/13/96 3,750(15) 3,750(15) -0- -0-
The Equity Group
Profit-Sharing Plan and
Trust(Robert D.
Goldstein, Trustee)
by agreement dated
1/1/80 7,500(15) 7,500(15) -0- -0-
Jeffrey I. Binder &
Rosalie G. Binder (TE) 7,500(15) 7,500(15) -0- -0-
Jay Haft 3,750(15) 3,750(15) -0- -0-
Henry Tie Shue 3,750(15) 3,750(15) -0- -0-
Bruno Guazzoni c/o
Zanett Capital, Inc. 7,500(15) 7,500(15) -0- -0-
Barry J. Booth &
Suellen G. Booth (JT) 7,500(15) 7,500(15) -0- -0-
Lenore Katz 7,500(15) 7,500(15) -0- -0-
Private Opportunity
Partners II, Ltd.FL
Limited Partnership 71,250 71,250 -0- -0-
<FN>
<F1>
Unless otherwise noted, the Company believes that all persons named above
have sole voting and investment power with respect to all
Common Stock beneficially owned by them, subject to community
property laws, where applicable. A person is deemed to be the
beneficial owner of securities that can be acquired by such person
within 60 days from the date hereof upon the exercise of warrants or
options. Each beneficial owner's percentage ownership is determined
by assuming that options or warrants that are held by such person
(but not those held by any other person) and which are exercisable
within 60 days from the date hereof have been exercised.
<F2>
Assumes that all of the shares registered for the account of the
Selling Stockholders are sold.
<F3>
Includes 50,000 shares of Common Stock owned by Mr. Brodsky's
wife. Includes presently exercisable options to purchase 74,000
shares of Common Stock at $1.79 per share under the Company's
Employee's Incentive Stock Option Plan (the "Incentive Plan");
includes presently exercisable options to purchase 44,000 shares of
Common Stock at $1.51 per share under the 1995 Stock Option Plan (the
"1995 Plan"); includes presently exercisable options to purchase
44,000 shares of Common Stock at $2.34 per share under the 1995 Plan;
includes presently exercisable options to purchase 60,667 shares of
Common Stock at $1.38 per share under the Non-Qualified Stock Option
Plan (the "Non-Qualified Plan"); includes presently exercisable
options to purchase 36,667 shares of Common Stock at $2.61 per share
under the 1995 Plan; includes presently exercisable warrants to
purchase 200,000 shares of Common Stock at $1.38 per share under a
Warrant Agreement which expires in August, 2001; includes 68,352
shares of the Company's Common Stock owned by the trusts established
for the benefit of Mr. Brodsky's four children, of which Mr. Brodsky
is a trustee.
<F4>
Excludes 18,710 shares of Common Stock owned by Mr. Freund's
adult children. Excludes 4,000 shares of Common Stock and
presently exercisable options to purchase (i) 43,000 shares of
Common Stock at $1.79 per share under the Incentive Plan, (ii) 18,000
shares of Common Stock at $1.38 per share under the 1995 Plan and
(iii)18,000 shares of Common Stock at $1.38 per share under the Non-
Qualified Plan owned by Mr. Freund's wife. As set forth in Mr.
Freund's Schedule 13G, filed with the SEC on February 9, 1997, Mr.
Freund disclaims any beneficial interest in, or voting or dispositive
control over, such shares; includes presently exercisable options to
purchase 43,000 shares of Common Stock at $1.79 per share under the
Incentive Plan; includes presently exercisable options to purchase
18,000 shares of Common Stock at $1.51 per share under the 1995 Plan;
includes presently exercisable options to purchase 36,000 shares of
Common Stock at $2.34 per share under the 1995 Plan; includes
presently exercisable options to purchase 18,000 shares of Common
Stock at $1.38 per share under the Non-Qualified Plan; includes
presently exercisable options to purchase 30,000 shares of Common
Stock at $2.61 per share under the 1995 Plan.
<F5>
Includes presently exercisable options to purchase 46,667 shares
of Common Stock at $1.79 per share under the Incentive Plan; includes
presently exercisable options to purchase 20,000 shares of Common
Stock at $1.51 per share under the 1995 Plan; includes presently
exercisable options to purchase 20,000 shares of Common Stock at
$2.34 per share under the 1995 Plan; includes presently exercisable
options to purchase 20,000 shares of Common Stock at $1.38 per share
under the Non-Qualified Plan; includes presently exercisable options
to purchase 25,000 shares of Common Stock at $2.61 per share under
the 1995 Plan. Includes 8,000 shares of the Company's Common Stock
owned by trusts established for the benefit of Mr. Stoller's children
of which Mr. Stoller is a trustee.
<F6>
Includes 101,200 Shares issuable upon the exercise of currently
exercisable warrants.
<F7>
Includes 30,800 Shares issuable upon the exercise of currently
exercisable warrants.
<F8>
Includes 30,800 Shares issuable upon the exercise of currently
exercisable warrants.
<F9>
Includes 20,000 Shares issuable upon the exercise of currently
exercisable warrants.
<F10>
Includes 4,400 Shares issuable upon the exercise of currently
exercisable warrants.
<F11>
Includes 4,400 Shares issuable upon the exercise of currently
exercisable warrants.
<F12>
Includes 4,400 Shares issuable upon the exercise of currently
exercisable warrants.
<F13>
Includes 2,000 Shares issuable upon the exercise of currently
exercisable warrants.
<F14>
Includes 2,000 Shares issuable upon the exercise of currently
exercisable warrants.
<F15>
Of such amount, two-thirds represents shares of Common Stock and
one-third represents shares of Common Stock issuable upon exercise of
currently exercisable warrants.
</FN>
</TABLE>
Certain of the securities set forth in the above table are
included in this Prospectus pursuant to registration commitments
accorded to certain of the Selling Stockholders. There are no
commitments pursuant to which the Company will receive any proceeds
from the sale of the Shares by the Selling Stockholders.
To the Company's knowledge, no Selling Stockholder has had any
position, office or other material relationship with the Company or
any of its affiliates during the past three years (other than as a
holder of the Company's securities), except that (i) Bert E. Brodsky
has served as Chairman of the Board and Treasurer of the Company
since 1983 and President since 1989; (ii) Hugh Freund has served as a
director of the Company since 1978 and Executive Vice President of
the Company since 1986 (iii) Gary Stoller has served as a director
and Executive Vice President of the Company since 1983; and (iv) B&B
has been a market maker of the Company's Common Shares during such
three year period. B&B acted as the placement agent in a recent
private offering by the Company. The Company believes that Messrs.
Steven R. Bronson, James S. Cassel, (and James S. Cassel and Mindy
Cassel TBTS), Keil Stern, Eric R. Elliot, Barry J. Booth, Bruce C.
Barber, Barry E. Steiner (and Ms. Lisa Steiner, JTWROS) and Scott
Salpeter are affiliated with B&B.
PLAN OF DISTRIBUTION
The Shares set forth in the "Selling Stockholders" table may be
sold by the Selling Stockholders, or by pledgees, donees, transferees
or other successors in interest, either pursuant to the Registration
Statement of which this Prospectus forms a part or, if available,
under Section 4(1) of the Securities Act or Rule 144 promulgated
thereunder.
To the Company's knowledge, this offering is not being underwritten.
The Company believes that the Selling Stockholders, directly through
agents designated from time to time, or through broker-dealers or
underwriters also to be designated (who may purchase as principal and
resell for their own account), may sell the Shares from time to time,
in or through privately negotiated transactions, or in one or more
transactions, including block transactions, on the NASDAQ SmallCap
Market or on any other market or stock exchange on which the Shares
may be listed in the future pursuant to and in accordance with the
applicable rules of such market or exchange or otherwise. The selling
price of the Shares may be at market prices prevailing at the time of
sale, at prices relating to such prevailing market prices or at
negotiated prices. From time to time the Selling Stockholders may
engage in short sales against the box, puts and calls and other
transactions in securities of the Company or derivatives thereof, and
may sell and deliver the shares in connection therewith. Further,
except as set forth herein, the Selling Stockholders are not
restricted as to the number of shares which may be sold at any one
time, and it is possible that a significant number of shares could be
sold at the same time, which may have a depressive effect on the
market price of the Company's shares of Common Stock.
The Selling Stockholders may also pledge shares as collateral for
margin accounts, and such shares could be resold pursuant to the terms
of such accounts. Resales or reoffers of the Shares by the Selling
Stockholders must be accompanied by a copy of this Prospectus.
The Selling Stockholders and any agents, broker-dealers or underwriters
that participate in the distribution of the Shares may be deemed to be
underwriters, and any profit on the sale of the Shares by them, and any
discounts, commissions or concessions received by them, may be deemed
to be underwriting commissions or discounts under the Securities Act.
LEGAL MATTERS
Matters relating to the legality of the securities being offered
hereby are being passed upon for the Company by Certilman Balin Adler
& Hyman, LLP, 90 Merrick Avenue, East Meadow, New York 11554.
EXPERTS
The consolidated financial statements of the Company appearing
in the Form 10-KSB, as amended, have been audited by Marcum &
Kliegman, LLP, independent auditors, as set forth in their report
thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
The Company has filed a Registration Statement on Form S-3 (together
with all amendments thereto, the "Registration Statement") with the
Commission under the Securities Act of 1933, as amended, with respect
to the securities offered hereby. This Prospectus does not contain
all of the information set forth in the Registration Statement. For
further information with respect to the Company and the securities
offered hereby, reference is made to the Registration Statement and to
the exhibits filed therewith, copies of which may be obtained upon
payment of a fee prescribed by the Commission, or may be examined free
of charge at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549. Each statement made in this Prospectus referring to a
document filed as an exhibit to the Registration Statement is
qualified by reference to the exhibit for a complete statement of its
terms and conditions.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses (estimated except
for the Registration Fee) in connection with the Offering described
in the Registration Statement:
Registration Fee $3,056.71
Accountants' Fees and Expenses 3,000.00
Legal Fees and Expenses 15,000.00
Printing 1,500.00
Miscellaneous 500.00
Total $23,056.71
Item 15. Indemnification of Directors and Officers.
Pursuant to Section 145 of the Delaware General Corporation Law,
Sandata, Inc. (hereinafter, the "Registrant") has the power, under
certain circumstances, to indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or
was a director, officer, employee or agent of the Company, or is or
was serving at the request of the Company as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding.
Article Tenth of the Registrant's Certificate of Incorporation
provides that the Registrant shall, to the fullest extent permitted
by said Section 145, indemnify all persons whom it may indemnify
pursuant thereto.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 ("1933 Act") may be permitted to directors,
officers or controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been advised
that, in the opinion of the Commission, such indemnification is
against public policy as expressed in the 1933 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
1933 Act and will be governed by the final adjudication of such
issue.
Item 16. Exhibits.
Exhibit Number Description of Exhibit
5 Opinion of Certilman Balin Adler & Hyman, LLP
regarding the legality of the securities being
registered
23.1 Consent of Marcum & Kliegman, LLP
23.2 Consent of Certilman Balin Adler & Hyman, LLP
(included in its opinion filed as Exhibit 5)
24 Powers of Attorney (included in signature page
forming a part hereof)
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(l)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
the 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 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective 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 (l)(i) and (l)(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 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.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, as amended, each filing of the Registrant's
annual report pursuant to Section 13(a) or 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 under Item 15 above, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the 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.
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 Port
Washington, State of New York, on the 19th day of February 1997.
SANDATA, INC.
By: /s/ Bert E. Brodsky
Bert E. Brodsky
President and Chief Executive Officer
POWER OF ATTORNEY
Know all men by these presents, that each person whose signature
appears below constitutes and appoints Bert E. Brodsky as his true
and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution for him and in his name, place and
stead, in any and all capacities to sign any and all amendments
(including post-effective amendments) to this Registration Statement,
and to file the same, with all exhibits thereto, and other documents
in connection therewith with the Securities and Exchange Commission,
granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent 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 below by the following persons
in the capacities and on the dates indicated.
Signature Capacity Date
President, Treasurer,
Chief Executive Officer
and Chairman of the
Board (Principal
Executive Officer and
Principal Financial and
Accounting Officer) February 19, 1997
Bert E. Brodsky
Executive Vice President
Secretary and Director
February 19, 1997
Hugh Freund
Executive Vice President
and Director
February 19, 1997
Gary Stoller
Exhibit 5
February 19, 1997
Sandata, Inc.
26 Harbor Park Drive
Port Washington, New York 11050
Re: Registration Statement on Form S-3
Gentlemen:
In our capacity as counsel to Sandata, Inc., a Delaware corporation
(the "Company"), we have been asked to render this opinion in
connection with the Company's Registration Statement on Form S-3 (the
"Registration Statement") being filed contemporaneously by the Company
with the Securities and Exchange Commission under the Securities Act
of 1933, as amended, covering (i) 350,000 shares of Common Stock,
$.001 par value, of the Company (the "Issuable Shares") which are
issuable by the Company to certain persons and entities upon the
exercise of certain warrants (the "Warrants") and are being registered
for resale by such persons and entities; and (ii) 738,140 shares of
Common Stock, $.001 par value, of the Company (the "Selling
Stockholder Shares") which are owned by certain persons and entities
and are being registered for resale by such persons and entities. The
Issuable Shares and the Selling Stockholder Shares are collectively
referred to herein as the "Shares".
In connection with our opinion, we have examined the Certificate of
Incorporation and By-Laws of the Company, each as amended, the
Registration Statement, and certain agreements entered into, and
instruments and warrants issued, by the Company in connection with the
issuance of the Shares. We are also familiar with proceedings of the
Board of Directors of the Company, or otherwise have relied upon
representations made by officers of the Company, relating to the
authorization of the issuance of the Shares. We have also examined
such other instruments and documents as we deemed relevant under the
circumstances.
For purposes of the opinions expressed below, we have assumed (i) the
authenticity of all documents submitted to us as originals, (ii) the
conformity to the originals of all documents submitted as certified,
photostatic or facsimile copies and the authenticity of the originals,
(iii) the legal capacity of natural persons, (iv) the due
authorization, execution and delivery of all documents by all parties
and the validity and binding effect thereof and (v) the conformity to
the proceedings of the Board of Directors of all minutes of such
proceedings and all representations, oral and written, made by
officers of the Company with respect thereto. We have also assumed
that the corporate records furnished to us by the Company include all
corporate proceedings taken by the Company to date.
Based upon and subject to the foregoing, including the assumptions
made, we are of the opinion that (i) the Selling Stockholder Shares
were duly and validly authorized and issued and are fully paid and
nonassessable shares of Common Stock, $.001 par value, of the Company,
and (ii) the Issuable Shares will be, upon issuance in accordance with
the terms of the respective warrants, duly and validly authorized and
issued, fully paid and nonassessable shares of Common Stock, $.001 par
value, of the Company.
We hereby consent to the use of our opinion as herein set forth as an
exhibit to the Registration Statement and to the use of our name under
the caption "Legal Matters" in the Prospectus forming a part of the
Registration Statement.
This opinion is as of the date hereof, and we do not undertake, and
hereby disclaim, any obligation to advise you of any changes in any of
the matters set forth herein.
We are rendering this opinion only as to the matters expressly set
forth herein, and no opinion should be inferred as to any other
matters.
This opinion is for your exclusive use only and is to be utilized and
relied upon only in connection with the matters expressly set forth
herein.
Very truly yours,
CERTILMAN BALIN ADLER & HYMAN, LLP
