UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
MAY 19, 1998
PROXYMED, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 0-22052 65-0202059
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2501 DAVIE ROAD, SUITE 230, FT. LAUDERDALE, FLORIDA 33317-7424
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (954) 473-1001
<PAGE>
INTRODUCTION.
Item 5 is amended herein to correct an error in the number of warrants
reported to have been earned by Commonwealth Associates, from 231,342 warrants
as previously reported, to 94,978 warrants as corrected.
Exhibits 2.4 and 2.5 are included herein as required by Item 7(a).
Exhibit 99.1 is amended to correct an error in the pro forma entry to
record the acquisition of the common stock of WPJ, Inc. and the related purchase
price allocation.
Exhibits 99.2 and 99.3 are amended to correct the amount of amortization
for the capitalized software, goodwill and other intangible assets related to
the acquisition of WPJ, Inc.
ITEM 5. OTHER EVENTS (AMENDED).
On May 19 and June 1, 1998, the Company closed on the private placement
sale of an aggregate of 2,313,416 shares of common stock, $.001 par value, for
$11.00 per share, resulting in gross proceeds of $25,447,576. Commonwealth
Associates represented the Company as underwriter in the transaction, for which
it received $731,330 in commissions, $254,476 as a non-accountable expense
allowance, and a five-year warrant to purchase 94,978 shares of the Company's
common stock for $12.10 per share. Other costs of the transaction aggregated
approximately $212,000. The shares sold were not registered under the Securities
Act of 1933 (the "Act"), and were offered in reliance upon the exemption under
Section 4(2) of the Act and the provisions of Regulation D promulgated
thereunder. Bellingham Industries Inc., an affiliate, purchased 1,363,632 shares
in the offering, after which it beneficially owns 41.7% of the Company's
outstanding common stock. Of the funds raised, $20,620,000 was used for the
acquisition of IMS referred to in Item 2 above, and the balance will be used for
other acquisitions and/or working capital.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) The unaudited statements of operations and cash flows required by
Item 7(a) of WPJ, Inc. for the three months ended March 31, 1997, are
included as exhibits to this Form 8-K/A. The unaudited financial
information for the three months ended March 31, 1997, reflects all
adjustments (consisting solely of normal recurring adjustments) which
are, in the opinion of management, necessary for a fair statement of
results for the interim period presented.
2
<PAGE>
(c) The following exhibits are included herein:
Exhibit 2.4 - Unaudited Statement of Operations for WPJ, Inc. for
the three months ended March 31, 1997.
Exhibit 2.5 - Unaudited Statement of Cash Flows for WPJ, Inc. for
the three months ended March 31, 1997.
Exhibit 99.1 - Pro Forma Combined Balance Sheet of ProxyMed, Inc.
and WPJ, Inc. as of March 31, 1998 (amended).
Exhibit 99.2 - Pro Forma Combined Statement of Operations of
ProxyMed, Inc., Clinical MicroSystems, Inc., Hayes Computer
Systems, Inc., US HealthData Interchange, Inc. and WPJ, Inc. for
the year ended December 31, 1997 (amended).
Exhibit 99.3 - Pro Forma Combined Statement of Operations of
ProxyMed, Inc. and WPJ, Inc. for the three months ended March 31,
1998 (amended).
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PROXYMED, INC.
Date JULY 13, 1998 /S/ BENNETT MARKS
-----------------------------
Bennett Marks, Executive Vice
President - Finance and Chief
Financial Officer
4
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
2.4 Unaudited Statement of Operations for WPJ, Inc. for the three
months ended March 31, 1997.
2.5 Unaudited Statement of Cash Flows for WPJ, Inc. for the three
months ended March 31, 1997.
99.1 Pro Forma Combined Balance Sheet of ProxyMed, Inc. and WPJ, Inc.
as of March 31, 1998 (amended).
99.2 Pro Forma Combined Statement of Operations of ProxyMed, Inc.,
Clinical MicroSystems, Inc., Hayes Computer Systems, Inc., US
HealthData Interchange, Inc. and WPJ, Inc. for the year ended
December 31, 1997 (amended).
99.3 Pro Forma Combined Statement of Operations of ProxyMed, Inc. and
WPJ, Inc. for the three months ended March 31, 1998 (amended).
5
EXHIBIT 2.4
WPJ, INC.
D/B/A INTEGRATED MEDICAL SYSTEMS
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(UNAUDITED)
Net revenues for services $1,041,468
Cost of revenues for services 215,587
----------
Gross profit 825,881
General and administrative expenses 518,881
----------
Income from operations 307,108
Other income (expense):
Interest income 305
Interest expense (1,087)
Loss on disposal of equipment (20,780)
----------
Income before provision for income taxes 285,546
Provision for income taxes 1,071
----------
Net income $ 284,475
==========
EXHIBIT 2.5
WPJ, INC.
D/B/A INTEGRATED MEDICAL SYSTEMS
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(Unaudited)
Cash flows from operating activities:
Net income $ 284,475
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 13,137
Provision for doubtful accounts receivable 61,501
Net change in:
Accounts receivable (331,323)
Prepaid expenses and other assets (8,453)
Accounts payable and accrued liabilities 9,973
---------
Net cash provided by operating activities 29,310
---------
Cash flows from investing activities:
Purchase of property and equipment (22,745)
---------
Net cash used by investing activities (22,745)
---------
Cash flows from financing activities:
Principal payments on bank line of credit (1,241)
Shareholder distributions (8,864)
---------
Net cash provided by financing activities (10,105)
---------
Net increase in cash and cash equivalents (3,540)
Cash and cash equivalents, beginning of period 95,365
---------
Cash and cash equivalents, end of period $ 91,825
=========
EXHIBIT 99.1
<TABLE>
<CAPTION>
PROXYMED, INC.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET (AMENDED)
MARCH 31, 1998
WPJ, INC. (D/B/A PRO FORMA ADJUSTMENTS
INTEGRATED MEDICAL --------------------- PRO FORMA
ASSETS PROXYMED, INC. SYSTEMS) TOTAL # DR.(CR.) COMBINED
-------------- ------------------ ----- --------------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 3,513,083 $ 326,026 $ 3,839,109 (1) ($20,620,000) $ 7,236,966
(2) 24,250,000
(3) (232,143)
Accounts receivable, net 2,940,089 668,391 3,608,480 3,608,480
Other receivables 860,780 0 860,780 860,780
Inventory 920,702 0 920,702 920,702
Other current assets 301,990 18,200 320,190 320,190
------------ ---------- ----------- ------------
Total current assets 8,536,644 1,012,617 9,549,261 12,947,118
Property and equipment, net 2,422,396 370,333 2,792,729 2,792,729
Capitalized software costs, net 4,590,110 0 4,590,110 (1) 7,500,000 12,090,110
Goodwill and other intangible
assets, net 5,011,206 0 5,011,206 (1) 17,977,111 22,988,317
Other assets 48,810 9,781 58,591 58,591
------------ ---------- ----------- ------------
Total assets $ 20,609,166 $1,392,731 $22,001,897 $ 50,876,865
============ ========== =========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 750,000 $ 232,143 $ 982,143 (3) 232,143 $ 750,000
Accounts payable and accrued expenses 3,321,897 387,699 3,709,596 (1) (26,000) 3,994,271
(1)
Deferred revenue 542,584 0 542,584 542,584
------------ ---------- ----------- ------------
Total current liabilities $ 4,614,481 $ 619,842 $ 5,234,323 $ 5,286,655
Long-term debt, less current portion 1,074,760 0 1,074,760 1,074,760
------------ ---------- ----------- ------------
Total liabilities $ 5,689,241 $ 619,842 $ 6,309,083 $ 6,361,615
------------ ---------- ----------- ------------
Stockholders' equity:
Common stock 12,338 1,000 13,338 (1) (482) 15,133
(1) 1,000
(2) (2,313)
Additional paid-in capital 46,175,620 0 46,175,620 (1) (5,344,843) 75,768,150
(2) (24,247,687)
Accumulated deficit (31,268,033) 771,889 (30,496,144) (1) 771,889 (31,268,033)
------------ ---------- ----------- ------------
Total stockholders' equity 14,919,925 772,889 15,692,814 44,515,250
------------ ---------- ----------- ------------
Total liabilities and
stockholders' equity $ 20,609,166 $1,392,731 $22,001,897 $ 50,876,865
============ ========== =========== ============
</TABLE>
(1) To record the acquisition of the common stock of WPJ, Inc., the related
purchase price allocation, and the elimination of the equity accounts of
WPJ, Inc. in consolidation.
(2) To record net cash received from the private placement sale of 2,313,416
shares of common stock for $11 per share, less underwriter commissions and
estimated expenses totaling $1,197,576.
(3) To retire current portion of long-term debt of WPJ, Inc.
Note - The allocation of purchase price is preliminary and subject to change
upon review by management of additional evidence relating to the fair
value of assets acquired and liabilities assumed at the closing date.
Adjustments to the purchase price allocation, if any, would likely
relate to amounts assigned to intangible assets and/or estimates of the
useful lives relating thereto.
EXHIBIT 99.2
<TABLE>
<CAPTION>
PROXYMED, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS (AMENDED)
YEAR ENDED DECEMBER 31, 1997
CLINICAL
MICROSYSTEMS, HAYES COMPUTER US HEALTHDATA
PROXYMED, INC.(A) INC.(B) SYSTEMS, INC.(C) INTERCHANGE, INC.(D)
----------------- ------------- ----------------- -------------------
<S> <C> <C> <C> <C>
Net sales $ 10,931,969 $255,124 $2,720,389 $ 1,609,705
------------ -------- ---------- -----------
Costs and expenses:
Cost of sales 6,877,480 77,283 1,726,063 326,923
Selling, general and
administrative expenses 13,293,353 206,590 1,184,896 2,736,220
Depreciation and amortization 1,078,300 19,178 57,751 782,885
------------ -------- ---------- -----------
21,249,133 303,051 2,971,612 3,846,028
------------ -------- ---------- -----------
Operating income (loss) (10,317,164) (47,927) (251,223) (2,236,323)
Other income (expense):
Loss on sale of assets 0 0 0 (55,400)
Interest, net 267,140 (154) (58,390) 0
------------ -------- ---------- -----------
Income (loss) before income
taxes (10,050,024) (48,081) (309,613) (2,292,723)
Income tax benefit (expense) 0 0 138,350 0
------------ -------- ---------- -----------
Net income (loss) applicable to
common shareholders ($10,050,024) ($48,081) ($171,263) ($2,292,723)
============ ======== ========= ===========
Weighted average common shares
outstanding 10,589,333
============
Basic and diluted loss per share
of common stock ($0.95)
============
<CAPTION>
WPJ, INC. (D/B/A PRO FORMA ADJUSTMENTS
INTEGRATED MEDICAL --------------------- PRO FORMA
SYSTEMS)(E) TOTAL # DR.(CR.) COMBINED
------------------ ----- --------------------- ---------
<S> <C> <C> <C> <C> <C>
Net sales $4,310,731 $ 19,627,918 $ 10,827,918
---------- ------------ ------------
Costs and expenses:
Cost of sales 1,073,120 10,083,769 10,083,769
Selling, general and
administrative expenses 2,434,310 19,855,371 19,855,371
Depreciation and amortization 72,088 2,010,182 (1) $ 13,629 10,346,470
(3) (14,966)
(5) 283,072
(6) (437,806)
(7) 8,492,370
---------- ------------ ------------
3,579,498 31,949,322 40,285,619
---------- ------------ ------------
Operating income (loss) 731,233 (12,121,404) (20,457,701)
Other income (expense):
Loss on sale of assets (20,780) (77,180) (77,180)
Interest, net (16,462) 192,134 (2) (26,384) 218,518
---------- ------------ ------------
Income (loss) before income
taxes 593,991 (12,006,450) (20,316,363)
Income tax benefit (expense) (8,621) 129,729 (4) 129,729 0
---------- ------------ ------------
Net income (loss) applicable to
common shareholders $ 685,370 ($11,876,721) ($20,316,363)
========== ============ ============
Weighted average common shares
outstanding 13,841,600 (f)
============
Basic and diluted loss per share
of common stock ($1.47)
============
<FN>
(1) To record additional amortization of goodwill and other intangible assets
for 1997 related to the acquisition of Clinical Micro Systems, Inc.
(2) To record additional interest expense for 1997 on debt issued for the
acquisition of Clinical MicroSystems, Inc.
(3) To record reduction of depreciation expense upon allocation of purchase
price to the non-current assets acquired in the acquisition of Hayes
Computer Systems, Inc.
(4) To eliminate income tax benefit (expense) of Hayes Computer Systems, Inc.
and WPJ, Inc. due to ProxyMed's net operating loss carryforwards.
(5) To record additional amortization of goodwill for 1997 related to the
acquisition of US HealthData Interchange, Inc.
(6) To record reduction of depreciation expense upon allocation of purchase
price to the non-current assets acquired in the acquisition of US HealthData
Interchange, Inc.
(7) To record amortization over 3 years of capitalized software, goodwill and
other intangible assets for 1997 related to the acquisition of WPJ, Inc.
(a) This column is derived from the audited consolidated financial statements of
ProxyMed, Inc. and subsidiaries for the year ended December 31, 1997.
(b) This column is derived from the unaudited financial statements of Clinical
MicroSystems, Inc. for the period January 1, 1997 to its acquisition on
March 14, 1997. The acquisition of Clinical MicroSystems, Inc. was reported
under Form 8-K dated March 14, 1997.
(c) This column is derived from the unaudited financial statements of Hayes
Computer systems, Inc. for the period January 1, 1997 to its acquisition on
April 30, 1997, after considering the effects of adjustments made in the
preparation of the audited financial statements for the 10 months ended
January 31, 1997. The acquisition of Hayes Computer Systems, Inc. was
reported under Form 8-K dated April 30, 1997.
(d) This column is derived from the unaudited financial statements of US
HealthData Interchange, Inc. for the six months ended September 30, 1997 and
the unaudited 3 month period ended March 31, 1997 previously included in the
audited financial statements of US HealthData Interchange, Inc. for the year
ended March 31, 1997.
(e) This column is derived from the audited financial statements of WPJ, Inc.
for the year ended December 31, 1997.
(f) Pro Forma weighted average shares includes 125,785, 388,215 and 481,836
shares issued in the acquisitions of Clinical MicroSystems, Inc., Hayes
Computer Systems, Inc. and WPJ, Inc., respectively, as if they were
outstanding since the beginning of 1997, plus an additional 2,313,416 shares
sold in a private placement on May 19, 1998 and June 1, 1998, primarily for
the purpose of acquiring WPJ, Inc.
Note - Pursuant to Rule 11-02(b)(5), the pro forma income statement presented
above excludes the non-recurring effect of the write-offs of purchased
in-process research and development costs in 1997 in the amount of
$8,467,098 which are directly attributable to the acquisitions of
Clinical MicroSystems, Inc. and Hayes Computer Systems, Inc. The income
tax benefit resulting from these write-offs is approximately $3,176,000.
Based on the weight of available evidence, a valuation allowance in the
amount of $3,176,000 has been recorded concurrently.
</FN>
</TABLE>
EXHIBIT 99.3
<TABLE>
<CAPTION>
PROXYMED, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS (AMENDED)
THREE MONTHS ENDED MARCH 31, 1998
WPJ, INC. (D/B/A
INTEGRATED MEDICAL PRO FORMA ADJUSTMENTS PRO FORMA
PROXYMED, INC.(A) SYSTEMS) (B) TOTAL # DR. (CR.) COMBINED
----------------- ------------------ ----------- --------------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net sales $4,847,916 $1,071,840 $5,919,756 $5,919,756
----------- ---------- ----------- -----------
Costs and expenses:
Cost of sales 1,769,854 379,999 2,149,853 2,149,853
Selling, general and
administrative expenses 4,148,048 604,627 4,752,675 4,752,675
Depreciation and
amortization 630,673 24,232 654,905 (2) 2,123,093 2,777,998
----------- ---------- ----------- -----------
6,548,575 1,008,858 7,557,433 9,680,526
----------- ---------- ----------- -----------
Operating income (loss) (1,700,659) 62,982 (1,637,677) (3,760,770)
Other income (expense):
Interest, net (11,958) (4,551) (16,509) (16,509)
----------- ---------- ----------- -----------
Income (loss) before
income taxes (1,712,617) 58,431 (1,654,186) (3,777,279)
Income tax expense 0 (1,084) (1,084) (1) (1,084) 0
----------- ---------- ----------- -----------
Net income (loss)
applicable to
common shareholders ($1,712,617) $57,347 ($1,655,270) ($3,777,279)
=========== ======= =========== ===========
Weighted average common
shares outstanding 11,858,345 14,653,597 (c)
=========== ===========
Basic and diluted loss per
share of common stock ($0.14) ($0.26)
=========== ===========
<FN>
(1) To eliminate income tax expense of WPJ, Inc. due to ProxyMed's net operating
loss carryforwards.
(2) To record amortization over 3 years of capitalized software, goodwill and
other intangible assets related to the acquisition of WPJ, Inc.
(a) This column is derived from the unaudited consolidated financial statements
of ProxyMed, Inc. and subsidiaries for the three months ended March 31,
1998.
(b) This column is derived from the unaudited financial statements of WPJ, Inc.
for the three months ended March 31, 1998.
(c) Pro Forma weighted average shares includes the following shares as if they
were outstanding since the beginning of 1998: 481,836 shares issued in the
acquisition of WPJ, Inc., and 2,313,416 shares sold in a private placement
on May 19, 1998 and June 1, 1998, primarily for the purpose of acquiring
WPJ, Inc.
</FN>
</TABLE>
