<PAGE> 1
As filed with the Securities and Exchange Commission on July 12, 2000
Registration No.
------------
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
MIDWEST MEDICAL INSURANCE HOLDING COMPANY
(Exact name of registrant as specified in its Charter)
State or other jurisdiction of incorporation or organization: Minnesota
Primary Standard Industrial Classification Code Number: 6749
IRS Employer Identification Number: 41-1625287
7650 Edinborough Way, Suite 400
Minneapolis, MN 55435, (952) 838-6700
(Address, including zip code, and telephone
number, including area code, of registrant's principal
executive offices)
David P. Bounk, President
Midwest Medical Insurance Holding Company
7650 Edinborough Way, Suite 400
Minneapolis, MN 55435, (952) 838-6700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
COPIES TO:
Ross C. Formell, Esq.
Best & Flanagan LLP
4000 U.S. Bank Place
601 Second Avenue South
Minneapolis, MN 55402
----------
Approximate date of commencement of proposed sale of the securities to
the public: As soon as possible after the effective date of this registration
statement. If 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, check the following box.[X]
----------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
Title of Each Proposed Proposed
Class of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Unit Price Fee
---------- ---------- -------- ---------------- --------
<S> <C> <C> <C> <C>
Class A Common Stock 3,000 shares $ 0 (1) $ 0 (1) $ 0
</TABLE>
(1) Shares are issued to new policyholders without consideration.
----------
The registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
<PAGE> 2
CROSS REFERENCE SHEET
Pursuant to Rule 501(b) of Regulation S-K
<TABLE>
<CAPTION>
Form S-2 Item Number and Caption Location in the Prospectus
-------------------------------- --------------------------
<S> <C>
1. Forepart of the Registration Statement and
Outside Front Cover Page of Prospectus Cover Page
2. Inside Front and Outside Back Cover Pages
of Prospectus Inside Front Cover Page; Outside Back Cover
Page
3. Summary Information, Risk Factors, and
Ratio of Earnings to Fixed Charges PROSPECTUS SUMMARY
4. Use of Proceeds Not Applicable
5. Determination of Offering Price THE OFFERING
6. Dilution Not Applicable
7. Selling Security Holders Not Applicable
8. Plan of Distribution THE OFFERING
9. Description of Securities to be Registered DESCRIPTION OF CAPITAL STOCK
10. Interests of Named Experts and Counsel Not Applicable
11. Information with Respect to the Registrant SELECTED FINANCIAL INFORMATION; MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS;
BUSINESS; MANAGEMENT; DESCRIPTION OF
CAPITAL STOCK; FINANCIAL STATEMENTS
12. Incorporation of Certain Information by Reference INCORPORATION BY REFERENCE
13. Disclosure of Commission Position on
Indemnification for Securities
Act Liabilities Not Applicable
</TABLE>
<PAGE> 3
PROSPECTUS
MIDWEST MEDICAL INSURANCE HOLDING COMPANY
3,000 shares of Class C Common Stock
Shares of Class C Common Stock are being offered by Midwest Medical
Insurance Holding Company only to purchasers of insurance from Midwest Holding's
wholly-owned subsidiary, Midwest Medical Insurance Company. Midwest Medical is a
physician-controlled medical malpractice insurance company which provides
professional liability insurance to Minnesota, Iowa, Nebraska, North Dakota,
South Dakota, Illinois and Wisconsin physicians. These shares are offered and
issued to you as part of your purchase of insurance from Midwest Medical. You
are not required to pay anything for these shares in addition to your insurance
premiums. You will receive and hold one share while you are insured by Midwest
Medical. You will forfeit this share if your insurance coverage with Midwest
Medical terminates for any reason. See "The Offering."
You may not transfer, sell or assign these shares to anyone else. See
"Description of Capital Stock."
----------------------------
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.
----------------------------
The date of this Prospectus is ,2000.
-------------
<PAGE> 4
[inside front cover]
No one is authorized to give you any information about this offering,
or to make any representations about this offering to you, other than those
contained in this prospectus. If someone does, you cannot rely upon that
information or representation. The delivery of this prospectus and distribution
of these shares does not imply that there has been no change in Midwest
Holding's affairs since the date of this prospectus, or that the information is
correct as of any later date. This prospectus is not an offer to sell, or a
solicitation of an offer to buy, any securities other than these shares.
<PAGE> 5
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary.............................................................................................. ii
The Offering.................................................................................................... 2
Description of Capital Stock.................................................................................... 2
Legal Matters................................................................................................... 3
Experts......................................................................................................... 3
Available Information........................................................................................... 4
Incorporation by Reference...................................................................................... 4
</TABLE>
i
<PAGE> 6
PROSPECTUS SUMMARY
This summary, along with the information on the cover page, highlights
what we believe is the most important information about the offering. However,
you should read this entire prospectus for a complete understanding of our
business and the securities offered.
THE COMPANIES
Midwest Medical is in the business of providing professional liability
insurance to physicians. It also provides this insurance, as well as general and
umbrella excess liability insurance, to clinics, hospitals and healthcare
systems. It is a wholly-owned subsidiary of Midwest Holding. The address and
telephone number of the principal executive offices of Midwest Holding and
Midwest Medical are: 7650 Edinborough Way, Suite 400, Minneapolis, Minnesota
55435; (951) 838-6700.
THE SHARES
You will not receive a certificate for these shares. These shares may
be owned by individual physicians or by individual physicians jointly with the
legal entities in which they practice. In the latter case, only the physician
can vote the shares. See "Description Of Capital Stock."
The Minnesota Medical Association holds the single Class B common share
of Midwest Holding presently outstanding. This gives it the exclusive right to
vote for the election of directors. The holders of the Class A and Class C
shares, at any time, may vote to cause Midwest Holding to redeem the Class B
common share for $1,000. If they do this, they will obtain the right to elect
directors.
<PAGE> 7
THE OFFERING
These shares are being offered only to purchasers of insurance from
Midwest Medical. Purchasers of insurance are not required to pay anything for
the shares in addition to their insurance premiums. Termination of coverage at
any time, for any reason, will result in a forfeiture of your share.
No certificates for these shares are issued. Although the shares have
been registered under the Securities Act of 1933 and state securities laws, they
are nontransferable, and there is no market in which they may be sold. Upon
termination of a physician's insurance policy with Midwest Medical for any
reason, the shares are forfeited to Midwest Holding. See "Description Of Capital
Stock."
No independent brokers, dealers, or underwriters have been engaged to
represent Midwest Holding in this offering and no commissions will be paid to
any person. These shares will be offered and sold solely by officers of Midwest
Holding.
DESCRIPTION OF CAPITAL STOCK
Description of Class C Common Shares. Class C common stock was created
by the Board of Directors, with shareholder approval, on June 29, 2000. Class C
common shares, no par value, may be owned by individual physicians or by
individual physicians jointly with the legal entities in which they practice. In
the latter case the shares can be voted only by the physicians, although they
have the right to grant proxies. No certificates are issued. Holders of shares
have the right to vote on all corporate matters except for the election of
members of the Board of Directors of Midwest Holding. This right has been
granted to the Minnesota Medical Association, the holder of the sole authorized
and outstanding Class B share. The Minnesota Medical Association has agreed to
elect the directors nominated by a committee of the Board of Directors.
As long as the Class B share remains outstanding, the holders of these
Class C shares may, along with the holders of any outstanding shares of Class A
common stock, at any time, cause Midwest Holding to redeem the Class B share at
par value ($1,000), and thereby gain the right to elect directors. This requires
the vote, as classes, of two-thirds of the Class C and Class A shareholders who
vote on the question, who must also be a majority of the Class C and Class A
shareholders, respectively.
These shares are restricted shares that cannot be sold to any person
other than Midwest Holding. These shares are forfeited when a physician insured
by Midwest Medical terminates his or her insurance coverage for any reason.
In the event of any merger, sale of all or substantially all of the
assets, or other extraordinary event or liquidation of Midwest Holding, holders
of these shares will share in any proceeds proportionately on the basis of a
distribution formula developed by the Board of Directors which
2
<PAGE> 8
takes into account the underwriting risk classification and years of coverage of
each shareholder. This formula will be equivalent to the allocation schedule
used to issue Class A shares to Class A shareholders.
These shares do not entitle shareholders to preemptive rights or
cumulative voting, and no assignment or other transfer is permitted.
Shareholders are permitted to enter into voting agreements and appoint proxies
to vote the shares, and are permitted to assign their rights to the proceeds
from any redemption of the shares.
There is no market for these shares, and it is not anticipated that
there ever will be a public or private market in which these shares are traded.
Therefore, all holders of these shares must expect to retain them until they
cease to be insured by Midwest Medical. Midwest Holding has never paid a
dividend, nor does it intend to within the foreseeable future. If it ever does,
shareholders will have the right to receive that dividend.
As of July 12, 2000, none of these shares were outstanding.
Please refer to Midwest Holding's Annual Report on Form 10-K for a
complete description of the Class A and Class B shares.
LEGAL MATTERS
The validity of the shares of Midwest Holding to be issued in this
offering, and other legal matters, are being passed upon for Midwest Holding by
Best & Flanagan LLP, Minneapolis, Minnesota.
EXPERTS
The consolidated financial statements and schedules of Midwest Medical
Insurance Holding Company at December 31, 1999 and 1998, and for each of the
three years in the period ended December 31, 1999, appearing in this prospectus
and registration statement have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report appearing elsewhere in this prospectus
and in the registration statement, and are included in reliance upon that report
given upon the authority of that firm as experts in accounting and auditing.
AVAILABLE INFORMATION
Midwest Holding is subject to the information reporting requirements of
the Securities Exchange Act of 1934, and files Form 10-K, Form 10-Q and other
reports and information with the Securities and Exchange Commission. Reports and
other information filed by Midwest Holding can be inspected and copied at the
Public Reference Room maintained by the Commission at 450 Fifth Street N.W.,
Washington, D.C. 20549, and at the following Regional Offices: 26 Federal Plaza,
New York, New York 10278; and 219 South Dearborn Street, Chicago, Illinois
60604. The public may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-
3
<PAGE> 9
0330. The SEC maintains an Internet site that contains reports, proxy and
information statements and other information regarding issuers that file
electronically with the SEC at http://www.sec.gov.
Midwest Holding provides its shareholders with an annual report
containing consolidated Midwest Holding and subsidiaries year-end financial
statements presented in accordance with auditing standards generally accepted in
the United States. Midwest Medical's separate net income and shareholders'
equity are presented on both a GAAP and statutory accounting basis in the notes
to the consolidated financial statements. Midwest Medical is subject to the
insurance company filing requirements of the Minnesota Department of Commerce
and files the National Association of Insurance Commissioners annual statement
each year with the Department of Commerce, which includes financial statements
presented in accordance with statutory requirements, together with an
independent auditor's report on those financial statements. Insurance holding
company regulations apply to Midwest Holding and it files Form B with the
Minnesota Department of Commerce annually. Form B contains current information
about management, the Board of Directors, and significant operating agreements,
as well as a financial report. Copies of any of these reports, or any of the
documents referred to in this prospectus, can be obtained by requesting them
from David P. Bounk, President and Chief Executive Officer, Midwest Medical
Insurance Holding Company, 7650 Edinborough Way, Suite 400, Minneapolis,
Minnesota 55435; (612) 838-6700.
INCORPORATION BY REFERENCE
The SEC allows us to incorporate by reference the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be a part of this prospectus. Any information we file with the SEC
will automatically update and supercede this information. We incorporate by
reference the documents listed below and any additional documents we file with
the SEC into this prospectus. They contain important information about us and
our financial condition.
4
<PAGE> 10
The following documents filed with the SEC (SEC File Number 0-21230)
are incorporated by reference into this prospectus:
- our Annual Report on Form 10-K for the fiscal year ended
December 31, 1999.
- our Annual Report to Shareholders for the fiscal year ended
December 31, 1999.
- our Quarterly Report on Form 10-Q for the quarter ended March
31, 2000.
- our Definitive Proxy Statement relating to the Meeting of
Stockholders held June 29, 2000.
All documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this prospectus and prior to the
termination of the offering of securities contemplated by this prospectus shall
be deemed to be incorporated by reference in this prospectus. These documents
shall be considered to be a part of this prospectus from the date of filing.
We will provide, without charge, to each person to whom a copy of this
prospectus has been delivered, a copy of any and all of the documents referred
to above which have been or may be incorporated in this prospectus by reference
and were not delivered with this prospectus. We will not deliver exhibits to
such documents, unless such exhibits are specifically incorporated by reference.
We will provide this information upon written or oral request by a person to
whom we delivered a copy of the prospectus. Requests for such copies should be
directed to Niles A. Cole, Chief Financial Officer, Midwest Medical Insurance
Holding Company, 7650 Edinborough Way, Suite 400, Minneapolis, MN 55435-5978.
Our general telephone number is (952) 838-6700
5
<PAGE> 11
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following are the estimated expenses to be paid by the Midwest
Holding in connection with the distribution of the securities being registered.
All such expenses are estimated, except for the SEC registration fee:
<TABLE>
<S> <C>
SEC registration fee ......................................................................................$ 0
Accounting fees and expenses............................................................................ 10,000.00
Legal fees and expenses...................................................................................10,000.00
Printing and engraving expenses...........................................................................10,000.00
Blue Sky fees and expenses.................................................................................5,000.00
Miscellaneous expenses.....................................................................................1,000.00
Total.............................................................................................$36,000.00
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article X of the Bylaws of the registrant provides that each director,
committee member, officer, and employee shall be indemnified for expenses and
liabilities in the manner, under the circumstances, and to the extent permitted
by Minnesota Statutes, Section 302A.521, as amended from time to time.
Indemnification is also extended to certain consultants, agents, directors,
officers and employees of subsidiaries of the registrant.
Minnesota Statutes, Section 302A.521, generally requires a corporation
to indemnity its directors, officers, and employees against judgments,
penalties, fines, and expenses, including attorney's fees, incurred in
connection with their official capacities, provided that such person (i) has not
been indemnified by another with respect to the same matter, (ii) acted in good
faith, (iii) received no improper personal benefit, (iv) had no reasonable cause
to believe that his conduct was unlawful, and (v) reasonably believed that his
conduct was in the best interests of the corporation.
II-1
<PAGE> 12
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits.
<TABLE>
<S> <C> <C>
* 3A. Restated Articles of Incorporation of the registrant.
* 3B. Bylaws of the registrant, as amended.
* 5. Opinion and Consent of Best & Flanagan LLP.
(1) 9. Voting Trust Agreement between the Minnesota Medical Association and
the Iowa Medical Society.
(1) 10A. Governance Agreement between the registrant and the Minnesota Medical
Association, holder of the registrant's Class B Common Share, dated
November 30, 1998.
(6) 10B. Lease for office space between the registrant and Centennial Lakes IV, L.L.C.,
dated July 30, 1999.
(6) 10C. Amended and Restated Management Agreement between the registrant and
Midwest Medical Insurance Company dated July 1, 1999.
(5) 10D. Agreement of Reinsurance between Midwest Medical Insurance Company and
General Reinsurance Corporation, dated January 1, 1998.
(2) 10E. Letter Employment Agreement between the registrant and David P. Bounk,
President and Chief Executive Officer of the registrant and Midwest Medical
Insurance Company, dated January 1, 1993.
(6) 10F. 1999 Officers Short-Term Incentive Plan of the registrant.
(4) 10G. Amended and Restated Supplemental Executive Retirement Plan of the registrant.
(6) 10H. Amended and Restated Endorsement Agreement between Midwest Medical Insurance Company and Iowa
Medical Society, dated January 1, 1999.
(4) 10I. Form of Termination Agreement with Executive Officers.
(5) 21. Subsidiaries of the registrant.
* 23. Consent of Ernst & Young LLP.
</TABLE>
II-2
<PAGE> 13
<TABLE>
<S> <C> <C>
* 24. Powers of Attorney.
(6) 27. Financial Data Schedule.
</TABLE>
(1) Incorporated herein by reference to the registration statement on Form S-4,
file number 33-55062, filed by registrant on November 25, 1993,
as amended.
(2) Incorporated herein by reference to the registration statement on Form S-2,
SEC file number 33-70182, filed by registrant on October 12,
1993, as amended.
(3) Incorporated herein by reference to the registration statement on
Form S-4, SEC file number 333-00134, filed by registrant on
January 10, 1996, as amended.
(4) Incorporated herein by reference to the registration statement on
Form S-2, SEC file number 333-29047, filed by registrant on June
11, 1997, as amended.
(5) Incorporated herein by reference to the Annual Report on Form
10-K filed by registrant for the year ended December 31, 1998,
SEC File No. 0-21230.
(6) Incorporated herein by reference to the Annual Report on Form
10-K filed by registrant for the year ended December 31, 1999,
SEC File No. 0-21230.
(*) Filed herewith.
(b) Financial Statement Schedules.
The following financial statement schedules of the Midwest
Holding required by Regulation S-X and Form S-2 are filed as part of
this Registration Statement and incorporated by reference to Midwest
Holding's Annual Report of Form 10-K for the year ended December 31,
1999:
II. Condensed Financial Information of Registrant (Parent
Company)--Balance Sheets--December 31, 1999 and 1998, Statements of
Income--For the Years Ended December 31, 1999 and 1998 and 1997; and,
Statements of Cash Flows--For the Years Ended December 31, 1999, 1998 and
1997. Included in "FINANCIAL STATEMENTS" Section of Prospectus filed
herewith.
IV. Reinsurance Summary for the Years Ended December 31, 1999,
1998 and 1997. Included in "FINANCIAL STATEMENTS" section of Prospectus
filed herewith.
VI. Supplemental Information Concerning Property/Casualty
Insurance Operations--December 31, 1999 and 1998, and for Each of the Three
Years in the Period Ended December 31, 1999. Included in "FINANCIAL
STATEMENTS" section of Prospectus filed herewith.
II-3
<PAGE> 14
ITEM 17. UNDERTAKINGS.
(a) 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;
(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.
(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) If the registrant is a foreign private issuer, to file a
post-effective amendment to the registrant statement to include
any financial statements required by 3-19 of Regulation S-X at the
start of any delayed offering or throughout a continuous offering.
(b) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Minneapolis, State of
Minnesota, on July 12, 2000.
MIDWEST MEDICAL INSURANCE HOLDING COMPANY
By: /s/ David P. Bounk
---------------------------------------------
David P. Bounk, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on July 12, 2000.
SIGNATURE CAPACITY
--------- --------
/s/ David P. Bounk Principal Executive Officer and Director
------------------------------
David P. Bounk
/s/ Niles A. Cole Principal Financial Officer and
------------------------------ Principal Accounting Officer
Niles A. Cole Director, Chairman of the Board
*
------------------------------
Andrew J.K. Smith, M.D.
* Director
------------------------------
Michael Abrams
* Director
------------------------------
John R. Balfanz, M.D.
* Director
------------------------------
Gail P. Bender, M.D.
* Director
------------------------------
James R. Bishop, M.D.
* Director
------------------------------
Thomas C. Evans, M.D.
* Director
------------------------------
G. Richard Geier, M.D.
* Director
------------------------------
Anthony C. Jaspers, M.D.
* Director
------------------------------
Russel J. Kuzel, M.D.
* Director
------------------------------
Wayne F. Leebaw, M.D.
* Director
------------------------------
Mark O. Liaboe, M.D.
S-1
<PAGE> 16
* Director
------------------------------
Stephen A. McCue, M.D.
* Director
------------------------------
Harold W. Miller, M.D.
* Director
------------------------------
Anton S. Nesse, M.D.
* Director
------------------------------
Mark D. Odland, M.D.
* Director
------------------------------
Paul S. Sanders, M.D.
* Director
------------------------------
Richard D. Schmidt, M.D.
* Director
------------------------------
Judith F. Shank, M.D.
* Director
------------------------------
Thomas D. Throckmorton, M.D.
* Director
------------------------------
Bruce R. Trimble, M.D.
*By: /s/ David P. Bounk
----------------------------------------------
David P. Bounk pursuant to
power of attorney
The above persons signing as directors constitute all of the directors of the
registrant.
S-2
<PAGE> 17
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Page
------- ----
<S> <C>
3A. Restated Articles of Incorporation of the registrant.
3B. Bylaws of the registrants as amended.
5. Opinion and Consent of Best & Flanagan LLP
23. Consent of Ernst & Young LLP
24. Powers of Attorney
</TABLE>
