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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 21, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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PHYSICIAN SALES & SERVICE, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
FLORIDA
(State or other jurisdiction of 59-2280364
incorporation or organization) (I.R.S. Employer Identification No.)
</TABLE>
4345 SOUTHPOINT BOULEVARD, JACKSONVILLE, FLORIDA 32216
(904) 281-0011
(Address, including zip code, and telephone number,
including area code, of registrant's executive offices)
PATRICK C. KELLY
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
PHYSICIAN SALES & SERVICE, INC.
4345 SOUTHPOINT BOULEVARD
JACKSONVILLE, FLORIDA 32216
(904) 332-3000
(Name, address, including zip code, and telephone number
including area code, of agent for service)
The Commission is requested to send copies of all communications to:
J. VAUGHAN CURTIS, ESQ.
KIMBERLY A. KNIGHT, ESQ.
ALSTON & BIRD LLP
ONE ATLANTIC CENTER
1201 WEST PEACHTREE STREET
ATLANTA, GEORGIA 30309-3424
(404) 881-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. /x/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
-----
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED
TITLE OF SHARES AMOUNT TO BE AGGREGATE OFFERING MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PRICE PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE(1)
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<S> <C> <C> <C> <C>
Common Stock, $.01
par value per share 193,884 shares $18.75 $3,635,325 $1,102
=====================================================================================================
</TABLE>
(1) Estimated solely for purposes of determining the registration fee. This
amount, calculated pursuant to Rule 457(c), was based on the average of the
high and low prices of the Registrant's Common Stock on July 14, 1997, as
reported on the Nasdaq National Market System.
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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 SAID SECTION 8(A),
MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS SUBJECT TO COMPLETION DATED _________, 1997
193,884 SHARES
PHYSICIAN SALES & SERVICE, INC.
COMMON STOCK
This prospectus relates to 193,884 shares (the "Shares") of common stock,
$.01 par value per share (the "Common Stock"), of Physician Sales & Service,
Inc., a Florida corporation ("PSS" or the "Company"). All of these Shares are
being offered for sale by the holders of the Common Stock named herein under
the heading "Selling Shareholders" (the "Selling Shareholders"). The Selling
Shareholders received the Shares in connection with the Company's acquisitions
of Diagnostic Imaging, Inc. and Rad-Tech X-Ray, Inc. on November 25, 1996 and
March 20, 1997, respectively.
The shares of Common Stock of the Company are listed on the Nasdaq
National Market System ("Nasdaq") under the symbol PSSI. On July 18, 1997 the
last sales price for the shares of Common Stock as reported by Nasdaq was
$19.00 per share.
All or a portion of the Shares may be offered by the Selling Shareholders
from time to time (i) in transactions (which may include block transactions) on
the Nasdaq National Market or such other national securities exchange or
automated interdealer quotation system on which shares of the Company's Common
Stock are then traded, (ii) in negotiated transactions, or (iii) by a
combination of such methods of sale, at fixed prices, which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices. The Selling Shareholders
may effect such transactions by selling the Shares directly to purchasers or
through underwriters, agents or broker-dealers, and any such underwriters,
agents or broker-dealers may receive compensation in the form of discounts,
concessions or commissions from the Selling Shareholders and/or the purchasers
of the Shares for whom such underwriters, agents or broker-dealers may act as
agents or to whom they may sell as principals, or both (which compensation as
to a particular underwriter, agent or broker-dealer might be in excess of
customary compensation). To the extent required, the specific Common Stock to
be sold, the respective purchase prices and public offering prices, names of
such agent, dealer or underwriter, and any applicable commissions or discounts
with respect to a particular offer will be set forth in any accompanying
Prospectus Supplement or, if appropriate, a post-effective amendment to the
Registration Statement of which this Prospectus is a part. See "Selling
Shareholders" and "Plan of Distribution." None of the proceeds from the sale
of the Shares by the Selling Shareholders will be received by the Company. By
agreement, the Company will pay one-half of the expenses of this registration
and the Selling Shareholders will pay the remaining one-half of such expenses
pro rata based on the number of shares of Common Stock being offered hereby.
The Selling Shareholders will bear all underwriting discounts and commissions
and transfer taxes, if any. The Company has agreed to indemnify the Selling
Shareholders against certain liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act").
The Selling Shareholders and any broker-dealer, agents or underwriters
that participate with the Selling Shareholders in the distribution of the
Common Stock may be deemed to be "underwriters" within the meaning of Section
2(11) the Securities Act, and any commissions received by them and any profit
on the resale of the Common Stock purchased by them may be deemed underwriting
commissions or discounts under the Securities Act. See "Selling Shareholders"
and "Plan of Distribution."
------------------------
SEE "RISK FACTORS BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
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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 , 1997
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AVAILABLE INFORMATION
Additional information regarding the Company and the shares offered hereby
is contained in the Registration Statement on Form S-3 (of which this
Prospectus forms a part) and the exhibits relating thereto filed by the Company
with the Securities and Exchange Commission (the "Commission") under the
Securities Act. Statements contained herein concerning the provisions of
documents are necessarily summaries of such documents, and each statement is
qualified in its entirety by reference to the copy of the applicable document
filed with the Commission.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy and information statements and other
information with the Commission. Such reports, proxy and information
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices
located at 7 World Trade Center, Suite 1300, New York, New York 10048 and 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
materials can also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. Such reports, proxy and information statements and other information
filed electronically by the Company are available at the Commission's worldwide
web site at http://www.sec.gov. The Common Stock of the Company is traded on
the Nasdaq National Market under the symbol "PSSI," and such reports, proxy and
information statements and other information concerning the Company are
available for inspection at the office of the National Association of
Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company (File No.
0-23832) are hereby incorporated by reference into this Prospectus:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended March
28, 1997 (including those portions of the Company's Definitive Proxy
Statement for the fiscal year 1997 Annual Meeting of Shareholders
incorporated by reference therein); and
(2) The description of Common Stock set forth in the Company's registration
statement filed pursuant to Section 12 of the Exchange Act, and any
amendment or report filed for the purpose of updating any such
description.
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering registered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of the filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
(or in any subsequently filed document that also is or is deemed to be
incorporated by reference herein) modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus. All
information appearing in this Prospectus is qualified in its entirety by
information and financial statements (including notes thereto) appearing in the
documents incorporated by reference herein, except to the extent set forth in
the immediately preceding statement.
The Company will provide, without charge, to each person to whom a copy of
this Prospectus is delivered, including any beneficial owner, upon written or
oral request of such person, a copy of any or all
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of the documents incorporated by reference herein (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference into
the information that the Prospectus incorporates). Requests should be directed
to David A. Smith, Chief Financial Officer, Physician Sales & Service, Inc.,
4345 Southpoint Boulevard, Jacksonville, Florida 32216, telephone number (904)
332-3000.
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS CONTAINS AND INCORPORATES BY REFERENCE CERTAIN
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995 WITH RESPECT TO RESULTS OF OPERATIONS AND
BUSINESSES OF THE COMPANY. SUCH FORWARD-LOOKING STATEMENTS MAY INVOLVE
UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE THE ACTUAL RESULTS AND
PERFORMANCE OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM FUTURE RESULTS OR
PERFORMANCE EXPRESSED OR IMPLIED BY SUCH STATEMENTS. CAUTIONARY STATEMENTS
REGARDING THE RISKS ASSOCIATED WITH SUCH FORWARD-LOOKING STATEMENTS, INCLUDE,
WITHOUT LIMITATION, THOSE STATEMENTS INCLUDED UNDER "RISK FACTORS." INVESTORS
ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS,
WHICH SPEAK ONLY AS OF THE DATE HEREOF. THE COMPANY UNDERTAKES NO OBLIGATION
TO PUBLICLY RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO
REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE HEREOF OR TO REFLECT THE
OCCURRENCE OF UNANTICIPATED EVENTS.
ALL WRITTEN OR ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY
ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE FOREGOING CAUTIONARY
STATEMENT.
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THE COMPANY
Physician Sales & Service, Inc. ("PSS" or the "Company) is a leading
distributor of medical supplies, equipment and pharmaceuticals to primary care
and other office-based physicians. PSS currently operates 61 physician office
medical supply distribution ("core business") service centers distributing to
approximately 103,000 physician office sites in all 50 states. The Company's
primary market is the approximately 399,000 physicians who practice medicine in
approximately 198,000 office sites throughout the United States. According to
industry estimates, the medical supply and equipment segment of the health care
industry represents a $30.2 billion market, of which $6.6 billion represents
the primary care and other office-based physicians. The medical supply and
equipment industry is estimated to be growing at an annual rate of 6% to 8%.
PSS has historically grown faster than the overall market. The Company
estimates that approximately 300 companies supply medical products to the
office-based physician sector.
The Company, through its newly formed subsidiary, Diagnostic Imaging, Inc.
("DI" or "imaging division"), distributes medical diagnostic imaging supplies,
chemicals, equipment and service to the acute care and alternate care market.
DI currently operates 16 imaging service centers in nine southeastern states.
The Company is in the process of developing a separate information system for
DI which will include the current ICON(SM) and CustomerLink systems. A primary
company objective is to pursue acquisition opportunities within the radiology
and imaging distribution market in order to gain market share and expand the
product offerings to the physician office market currently serviced by PSS and
the acute care market currently serviced by DI.
The Company also distributes medical supplies and equipment in Belgium,
France, Germany, and the Netherlands through its WorldMed International, Inc.
subsidiary. The Company currently has three service centers ("European
operations") in Europe distributing to the acute and alternate care markets.
The Company's primary objectives are to be capable of servicing the
medical equipment and supply needs of every office-based physician in the
United States, to create a national diagnostic imaging distribution company,
and to expand its presence in the European medical equipment and supply market.
To achieve these objectives and increase profitability, the Company intends to
(i) continue to acquire core business medical supply and equipment distributors
in the United States and Europe, especially in existing markets where it can
leverage its distribution infrastructure and gain market share, (ii) acquire
diagnostic imaging distributors to expand its geographic coverage and leverage
its existing infrastructure, (iii) increase sales of existing service centers
by adding additional sales representatives and providing superior service,
competitive pricing and a broad product line, including sophisticated
diagnostic equipment, (iv) expand operating margins, (v) open new service
centers in selected markets where acquisition opportunities are not available,
and (vi) invest in sophisticated information systems that bring efficiency to
the Company and its subsidiaries.
On August 21, 1995, the Company completed the acquisition of Taylor
Medical, Inc. ("Taylor"), its largest acquisition to date in a stock-for-stock
pooling. Taylor distributed medical supplies and equipment mainly to
office-based physicians and managed care facilities. Taylor operated five
distribution centers, primarily in the Southwest and Northeast, with 20
redistribution and sales offices with approximately 175 sales representatives.
Taylor had physician-related net sales of approximately $122 million for the
fiscal year ended March 30, 1995. The acquisition of Taylor increased the
Company's market presence in the Southwest and Northeast and provides an
opportunity to enhance profitability through the integration and consolidation
of Taylor's operations.
Effective November 13, 1995 the Company completed a secondary offering of
11.5 million shares of common stock at $17 per share, 8.8 million of which were
offered by the Company. The Company used approximately $58.2 million of the
total net proceeds of $142.9 million to repay debt in fiscal 1996. Management
used approximately $50 million in connection with acquisitions of the imaging
division,
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core business, European operations, and general corporate purposes, including
capital expenditures during fiscal 1997. Management intends to use the
remaining net proceeds of the secondary offering for general corporate purposes,
including future acquisitions. The consummation of this transaction, along with
the Company's financing arrangements, has provided the Company with resources to
continue its strategy of being capable of servicing the medical equipment and
supply needs of every office-based physician in the United States, to create a
national imaging distribution company, and to expand its presence in the
European medical equipment and supply market.
On December 29, 1996, the Company acquired X-ray Corporation of Georgia
("X-ray GA") in a merger pursuant to which the Company issued 593,672 shares of
common stock to the former shareholders of X-ray GA, in exchange for all of the
outstanding shares of capital stock of X-ray GA valued at $11.0 million at the
time of the merger. This merger has been accounted for as a material
pooling-of-interests and, accordingly, the Company's consolidated financial
statements have been restated to include the accounts and operations of Taylor
and X-ray GA for all periods prior to the mergers.
In addition to Taylor and X-ray GA, for which the consolidated financial
statements have been restated for all periods prior to merger during fiscal
1996 and 1997, respectively, the Company merged with seven companies accounted
for as poolings-of-interest (four core business and three imaging division
companies) and 12 companies accounted for as purchases (nine core business and
three European operation companies).
PSS Common Stock is publicly traded over the counter by the Nasdaq
National Market System under the ticker symbol "PSSI".
The Company is incorporated under the laws of the State of Florida. The
address and telephone number of its principal executive offices are 4345
Southpoint Boulevard, Jacksonville, Florida, 32216, telephone number (904)
332-3000.
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RISK FACTORS
In addition to the other information in this Prospectus, the following
factors should be considered carefully in evaluating an investment in the
shares of Common Stock offered by this Prospectus.
ANTICIPATED EXPANSION AND MANAGEMENT OF EXPANDED OPERATIONS
The Company intends to acquire additional distributors in markets it
already services and expects to open additional service centers. The Company's
ability to expand its operations is dependent upon a number of factors,
including (i) the availability of suitable acquisition candidates on acceptable
terms, (ii) the Company's ability to continue to consolidate and integrate its
acquisitions with its existing operations, and (iii) the Company's ability to
attract, train, and retain skilled sales representatives and management.
Management anticipates that each start-up service center opened will generally
incur operating losses for 18 months. Accordingly, the Company's planned
expansion creates numerous risks, including the risk that the expansion may
have an adverse effect on working capital and earnings during the expansion
period and acquisition transition period, that substantial indebtedness may be
incurred in connection with the expansion and that significant losses could
result in the event of unsuccessful acquisitions or start-ups.
The Company recently has expanded into new product areas, including
radiology and imaging equipment, chemicals and supplies to the acute and
alternate site markets. The integration and operation of this new division may
place significant demands on the Company's management and other resources.
There can be no assurance that there will be any operating efficiencies between
the Company's businesses or that its diagnostic imaging division can be
operated profitably, which could have a material adverse effect on the
Company's business and future prospects. The Company plans to aggressively
pursue additional expansion opportunities in this market, however, there can be
no assurance that the Company will be successful in acquiring, operating or
integrating additional operations. In addition, the radiology and imaging
equipment market is heavily reliant on the hiring and retention of skilled
service technicians to maintain such equipment. There is a current shortage of
these skilled technicians, which may result in intense competition and
increasing salaries. Any inability of the Company to hire or retain such
skilled technicians could limit the Company's ability to expand and adversely
affect its results of operations.
MANAGEMENT OF INTERNATIONAL OPERATIONS
Through its WorldMed International subsidiary, the Company has recently
acquired medical supply distributors serving physicians in Belgium, France,
Germany and the Netherlands and plans to increase its presence in European
markets. As the Company expands internationally, it will need to hire, train
and retain qualified personnel in countries where language, cultural or
regulatory impediments may exist. The Company has encountered and expects to
encounter significant expense and delay in expanding its international
operations because of language and cultural differences, and staffing,
communications and related issues. There can be no assurance that the
Company's services and business practices will be accepted by vendors,
physicians or other involved parties in foreign markets.
International revenues are subject to inherent risks, including political
and economic instability, difficulties in staffing and managing foreign
operations and in accounts receivable collection, fluctuating currency exchange
rates, costs associated with localizing service offerings in foreign countries,
unexpected changes in regulatory requirements, difficulties in the repatriation
of earnings and burdens of complying with a wide variety of foreign laws and
labor practices.
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DEPENDENCE ON MANUFACTURERS
The Company distributes over 35,000 products manufactured by approximately
3,000 vendors and is dependent on these vendors for the manufacture and supply
of product. Additionally, the Company has entered into a significant contract
with Abbott, which may be terminated by Abbott if the Company does not meet
certain sales levels. The Company's ability to maintain good relations with
these vendors will affect the profitability of its business. Currently, the
Company relies on vendors to provide (i) field sales representatives' technical
and selling support, (ii) agreeable purchasing and delivery terms, (iii) sales
performance incentives, (iv) financial support of sales and marketing programs,
and (v) promotional materials. There can be no assurance that the Company will
maintain its good relations with its vendors.
REGULATION OF AND CHANGE IN PRACTICE OF MEDICINE
The health care industry, including the practice of medicine by
physicians, is subject to extensive government regulation, licensure and
operating procedures. The Company cannot predict the impact that present or
future regulations may have on operations of the Company or on its plan to
expand its business activities. In addition, as consolidation among physician
provider groups continues and provider networks are created, purchasing
decisions may shift to individuals with whom the Company has not had prior
selling relationships. The Company is increasingly focusing on national
accounts where the purchasing decision may not be made by the Company's
traditional physician customers. There can be no assurance that the Company
will be able to maintain its customer relationships in such circumstances.
DEPENDENCE ON THIRD-PARTY REIMBURSEMENT
The cost of a significant portion of medical care in the United States is
funded by government and private insurance programs, such as Medicare, Medicaid
and corporate health insurance plans. In recent years, government-imposed
limits on reimbursement of hospitals and other health care providers have
significantly impacted spending budgets in certain markets within the medical
supply and equipment industry. Private third-party reimbursement plans are
also developing increasingly sophisticated methods of controlling health care
costs through redesign of benefits and exploration of more cost-effective
methods of delivering health care. Accordingly, there can be no assurance that
reimbursement for purchase and use of medical equipment and supplies by
physicians' offices will not be limited or reduced and thereby adversely affect
future sales by the Company.
TWO-TIER PRICING
As a result of the Non-Profit Act of 1944, the medical supplies and
equipment industry is subject to a two-tier pricing structure. Under this
structure, certain institutions, originally limited to non-profit hospitals,
can obtain more favorable prices for medical supplies and equipment than the
Company. The two-tiered pricing structure continues to expand as many large
integrated health care providers and others with significant purchasing power
demand more favorable pricing terms. Although the Company is seeking to obtain
similar terms from its manufacturers, there can be no assurance that such terms
can be obtained. Such a pricing structure, should it persist, may put the
Company at a competitive disadvantage.
SALES REPRESENTATIVES
The Company's sales growth has resulted to a significant degree from
hiring and developing new sales representatives and adding, through
acquisitions, established sales representatives whose existing customers
generally have become customers of the Company. The Company's continued growth
will depend in part on its ability to continue to hire, train and retain sales
representatives who agree to the Company's compensation plans and to maintain
good relations with its existing sales representatives.
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KEY MANAGEMENT
The success of the Company is dependent upon the efforts and abilities of
its senior management, including the Company's Chairman and Chief Executive
Officer, Patrick C. Kelly, its President, John F. Sasen, Sr. and its Executive
Vice President and Chief Financial Officer, David A. Smith. The loss of any
such senior management may adversely affect the Company's business. The
Company maintains key man life insurance on Mr. Kelly.
COMPETITION
The marketing of medical supplies and equipment to physicians' offices is
highly competitive. Some of the Company's competitors are larger and have
greater financial resources than the Company. Also, the Company could
encounter additional competition because many of the products it sells are
readily obtainable by others from various sources of supply and such
competitors could consolidate into regional or national networks. In
addition, a competitor of the Company could obtain exclusive rights to market a
certain product to the exclusion of the Company. There can be no assurance
that the Company will not face increased competition in the future.
LIABILITY EXPOSURE
Although the Company is not a manufacturer, the distribution of medical
supplies and equipment entails risks of product liability. Despite the fact
that the Company has not to date experienced any significant product liability
claims and currently maintains liability insurance coverage, such insurance is
expensive, difficult to obtain and may be unobtainable in the future on
acceptable terms, if at all. The Company operates approximately 700 trucks to
deliver medical supplies and equipment on a same-day delivery basis. The
Company has experienced various claims regarding motor vehicle accidents, all
of which have been covered by insurance. The Company believes that it
maintains adequate insurance coverage for such claims. Nevertheless, the
amount and scope of any coverage may be inadequate in the event that a product
liability or motor vehicle accident claim is successfully asserted against the
Company.
RELIANCE ON DATA PROCESSING
The Company's business is dependent upon its ongoing ability to obtain,
process, analyze and manage data, and to maintain and upgrade its data
processing capabilities. Interruption of data processing capabilities for any
extended length of time, the failure to upgrade data services, difficulties in
converting data and information systems after acquisitions, loss of stored
data, programming errors or other computer problems could have a material
adverse effect on the Company's business.
ANTI-TAKEOVER PROVISIONS; POSSIBLE ISSUANCE OF PREFERRED STOCK
The Company's Amended and Restated Articles of Incorporation and Bylaws
contain various provisions that may make it more difficult for a third party to
acquire, or may discourage acquisition bids for, the Company and could limit
the price that certain investors might be willing to pay in the future for
shares of the Common Stock. In addition, the rights of the holders of Common
Stock will be subject to, and may be adversely affected by, the rights of any
holders of Preferred Stock that may be issued in the future and that may be
senior to the rights of the holders of Common Stock. Furthermore, the Company
has not opted out of certain provisions of the Florida Business Corporation
Act, including the provisions relating to control-share acquisitions, which
could have the effect of delaying, deferring or preventing a change in control
of the Company without further action by its shareholders.
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MERGERS AND ACQUISITIONS
On November 25, 1996, the Company acquired Diagnostic Imaging, Inc.
("DI"), a company organized under the laws of the State of Florida, pursuant to
a merger by which the shareholders of DI received shares of Common Stock in
exchange for their shares of stock in DI (the "DI Merger"). In connection with
the DI Merger, the Company granted the former shareholders of DI the right to
register for resale the shares of Common Stock held by such shareholders. The
former shareholders of DI who are offering shares of Common Stock pursuant to
the Registration Statement of which this Prospectus is a part are referred to
herein as the "DI Selling Shareholders."
On March 20, 1997, the Company acquired Rad-Tech X-Ray, Inc. ("Rad"), a
company organized under the laws of the State of Georgia, pursuant to a merger
by which the shareholders of Rad received shares of Common Stock in exchange
for their shares of stock in Rad (the "Rad Merger"). In connection with the
Rad Merger, the Company granted the former shareholders of Rad the right to
register for resale the shares of Common Stock held by such shareholders. The
former shareholder of Rad who is offering shares of Common Stock pursuant to
the Registration Statement of which this Prospectus is a part is referred to
herein as the "Rad Selling Shareholder."
The DI Selling Shareholders and the Rad Selling Shareholder are
collectively referred to herein as the "Selling Shareholders." The Selling
Shareholders have acquired the 193,884 shares of Common Stock offered hereby
pursuant to the above-referenced mergers.
Pursuant to certain demand registration rights granted in connection with
such merger, the Company agreed to register the shares of Common Stock offered
by the Selling Shareholders hereunder, and to use its best efforts to maintain
such registration statement in effect until the Shares are sold hereunder or up
to sixty (60) days following the date of this Prospectus. This Prospectus may
not be used by the Selling Shareholders following the earlier of (i) the date
the all shares of Common Stock offered hereby have been sold, or (ii) unless
otherwise agreed to by the Company, sixty (60) days following the date of this
Prospectus.
9
<PAGE> 11
SELLING SHAREHOLDERS
The following table sets forth (i) the name of each of the Selling
Shareholders, (ii) the number of shares of Common Stock beneficially owned by
each Selling Shareholder prior to the offering and being offered hereby, and
(iii) the number of shares of Common Stock beneficially owned by each Selling
Shareholder after completion of the offering.
<TABLE>
<CAPTION>
Shares Beneficially
Owned Prior to Shares Beneficially
Selling Shareholder Offering(1) Shares Being Offered Owned After Offering
- ------------------------ -------------------- -------------------- --------------------
<S> <C> <C> <C>
DI SELLING SHAREHOLDERS:
William F. Bronson (2). 129,221 40,000 89,221
Harvey A. Shores (2)... 82,659 50,000 32,659
William Shores (2)..... 4,570 3,884 686
RAD SELLING SHAREHOLDER:
Shelli T. Jenkins (3) 407,317 100,000 307,317
------- ------- -------
TOTAL................... 623,767 193,884 429,883
======= ======= =======
</TABLE>
(1) Assumes that all of the Shares held by the Selling Shareholders and being
offered hereby are sold, and that the Selling Shareholders acquire no
additional shares of Common Stock prior to completion of this offering.
Each Selling Shareholder beneficially owns less than 1% of the total
number of shares of Common Stock outstanding.
(2) Messrs. Bronson and Harvey Shores served as members of the Board of
Directors of DI prior to the DI Merger. Includes 19,383, 12,399 and 686
shares for Messrs. Bronson, Harvey Shores and William Shores,
respectively, being held in escrow pursuant to an Escrow Agreement dated
November 25, 1996, which may be used to indemnify the Company against
certain claims in connection with the DI Merger.
(3) Ms. Jenkins served as the President, Treasurer and sole director of Rad
prior to the Rad Merger. Includes 31,339 shares being held in escrow
pursuant to an Escrow Agreement dated March 20, 1997, which may be used to
indemnify the Company against certain claims in connection with the Rad
Merger.
10
<PAGE> 12
PLAN OF DISTRIBUTION
The Shares may be sold from time to time by the Selling Shareholders, or
by pledgees, donees, transferees or other successors in interest. Such sales
may be made from time to time (i) in transactions (which may include block
sales) on the Nasdaq National Market or such other national securities exchange
or automated interdealer quotation system on which shares of Common Stock are
then listed, (ii) in negotiated transactions or (iii) through a combination of
such methods of sale, at fixed prices, which may be changed, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, or at negotiated prices. The Shares may be sold directly to purchasers
or through underwriters, agents or broker-dealers by one or more of the
following: (a) ordinary brokerage transactions and transactions in which the
broker solicits purchasers; (b) purchases by a broker or dealer as principal
and resale by such broker or dealer for its account pursuant to this
Prospectus; (c) a block trade in which the broker or dealer so engaged will
attempt to sell the Shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction; (d) an exchange
distribution in accordance with the rules of the exchange or automated
interdealer quotation system on which the Common Stock is then listed; and (e)
through the writing of options on the Shares. Any such underwriters, agents or
broker-dealers may receive compensation in the form of discounts, concessions
or commissions from the Selling Shareholders and/or the purchasers of the
Shares for which such underwriters, agents or broker-dealers may act as agents
or to whom they sell as principals, or both (which compensation as to an
underwriter, agent or particular broker-dealer will be negotiated prior to the
sale and may be in excess of customary compensation). If required by
applicable law at the time a particular offer of Shares is made, the terms and
conditions of such transaction will be set forth in a Prospectus Supplement to
this Prospectus. In addition, any Shares covered by this Prospectus which
qualify for sale pursuant to Rule 144 under the Securities Act may be sold
under Rule 144 rather than pursuant to this Prospectus.
The Selling Shareholders and any underwriters, agents or broker-dealers
who act in connection with the sale of the Shares hereunder may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, and
any compensation received by them might be deemed to be underwriting discounts
and commissions under the Securities Act.
The Selling Shareholders will pay all applicable stock transfer taxes,
transfer fees and brokerage commissions or discounts. The Company has agreed
to bear one-half of all expenses in connection with the registration of the
shares being offered by the Selling Shareholders and the Selling Shareholders
shall bear the remaining one-half of all expenses on a pro rata basis. The
Company has agreed to indemnify the Selling Shareholders against certain
liabilities, including liabilities under the Securities Act.
11
<PAGE> 13
LEGAL MATTERS
A legal opinion to the effect that the Shares offered hereby by the
Selling Shareholders are validly issued, fully paid and non-assessable has been
rendered by Fred Elefant, P.A., Jacksonville, Florida, general counsel to the
Company.
EXPERTS
The consolidated financial statements of the Company appearing in its
Annual Report on Form 10-K for the fiscal year ended March 28, 1997 have been
audited by Arthur Andersen LLP, independent certified public accountants, as
indicated in their report with respect thereto and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
accounting and auditing.
12
<PAGE> 14
<TABLE>
=========================================== ==================================
<S> <C>
NO DEALER, SALESPERSON OR ANY OTHER
PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS
OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE 193,884 SHARES
RELIED UPON AS HAVING BEEN AUTHORIZED BY
THE COMPANY OR THE SELLING SHAREHOLDERS.
THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL, OR A SOLICITATION OF AN PHYSICIAN SALES &
OFFER TO BUY, TO ANY PERSON IN ANY SERVICE, INC.
JURISDICTION IN WHICH SUCH OFFER TO SELL
OR SOLICITATION IS NOT AUTHORIZED, OR IN
WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO COMMON STOCK
MAKE SUCH OFFER OR SOLICITATION.
___________________
TABLE OF CONTENTS
PAGE
-------
AVAILABLE INFORMATION.............. 2
INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE ............ 2
CAUTIONARY NOTICE REGARDING
FORWARD-LOOKING STATEMENTS ........ 3
THE COMPANY ....................... 4
RISK FACTORS ...................... 6
MERGERS AND ACQUISITIONS .......... 9
SELLING SHAREHOLDERS .............. 10
PLAN OF DISTRIBUTION .............. 11
LEGAL MATTERS ..................... 12
EXPERTS ........................... 12 P R O S P E C T U S
___________, 1997
=========================================== ==================================
</TABLE>
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
Registration fee to Securities and Exchange Commission ......... $1,102
Accounting fees and expenses ................................... 1,000
Legal fees and expenses ........................................ 5,000
Miscellaneous expenses ......................................... 1,000
------
Total .................................................... $8,102
======
</TABLE>
The foregoing items, except for the registration fee to the Securities and
Exchange Commission, are estimated. The Company has agreed to bear one-half of
all expenses in connection with the registration of the shares being offered by
the Selling Shareholders. The Selling Shareholders will bear all underwriting
discounts and commissions and transfer taxes, if any. The Company has agreed
to indemnify the Selling Shareholders against certain liabilities, including
liabilities under the Securities Act.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Amended and Restated Articles of Incorporation, as amended, and the
Amended and Restated Bylaws of the Registrant set forth the extent to which the
Registrant's directors and officers may be indemnified against liabilities they
may incur while serving in such capacities. Such indemnification will be
provided to the fullest extent allowed by the Florida Business Corporation Act,
as amended from time to time, and judicial or administrative decisions. Under
these indemnification provisions, the Registrant is required to indemnify any
of its directors and officers against any reasonable expenses (including
attorneys' fees) incurred by him in the defense of any action, suit or
proceeding, whether civil, criminal, administrative or investigative, to which
he was made a party, or in defense of any claim, issue or matter therein, by
reason of the fact that he is or was a director or officer of the Registrant or
who, while a director or officer of the Registrant, is or was serving at the
Registrant's request as a director, officer, partner, trustee, employee or
agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise to the extent that such director or officer
has been successful, on the merits or otherwise, in such defense. The
Registrant also may indemnify any of its directors or officers against any
liability incurred in connection with any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Registrant, in
which event, additional determinations must be made before indemnification is
provided) by reason of the fact that he is or was a director or officer of the
Registrant who, while a director or officer of the Registrant, is or was
serving at the Registrant's request as a director, officer, partner, trustee,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, if such director or officer acted in
good faith and in a manner he believed to be in, or not opposed to, the best
interests of the Registrant, and with respect to any criminal proceeding, had
no reasonable cause to believe his conduct was unlawful. The Registrant may
also provide advancement of expenses incurred by a director or officer in
defending any such action, suit or proceeding upon receipt of a written
affirmation of such officer or director that he has met certain standards of
conduct and an understanding by or on behalf of such officer or director to
repay such advances unless it is ultimately determined that he is entitled to
indemnification by the Registrant. Notwithstanding the foregoing, the Amended
and Restated Bylaws of the Registrant provide that the Registrant shall not be
required to indemnify any of its directors or officers in connection with a
proceeding initiated by such person unless such authorization for such
proceeding was not denied by the Board of Directors of the Registrant prior to
sixty (60) days after receipt of notice thereof from such person stating his or
her intent to initiate such proceeding and only upon such terms and conditions
as the Board of Directors may deem appropriate.
The Florida Business Corporation Act contains a provision which limits the
personal liability for monetary damages to the corporation or any other person
for any statement, vote, decision, or failure to
II-1
<PAGE> 16
act, regarding corporate management or policy, by a director, unless the
director breached or failed to perform his duties as a director and such breach
constitutes (i) a violation of criminal law, unless the director has reasonable
cause to believe his conduct was unlawful; (ii) a transaction from which the
director received an improper personal benefit; (iii) an unlawful distribution
under Florida law, (iv) in a proceeding by or in the right of a corporation to
procure a judgment in its favor or by or in the right of a shareholder,
conscious disregard for the best interest of the corporation, or willful
misconduct; or (v) in a proceeding by or in the right of someone other that the
corporation or a shareholder, recklessness or an act or omission which was
committed in bad faith or with malicious purpose or in a manner exhibiting
wanton or willful disregard of human rights, safety or property. The Registrant
maintains an insurance policy insuring the Registrant and directors and officers
of the Registrant against certain liabilities, including liabilities under the
Securities Act of 1933.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
4.1 Amended and Restated Articles of Incorporation, as amended, of the
Registrant (incorporated by reference from Registrant's Registration
Statement on Form S-3, effective November 13, 1995, Registration No.
33-97524).
4.2 Amended and Restated Bylaws of the Registrant (incorporated by reference
from Registrant's Registration Statement on Form S-1, Registration No.
33-76580).
5.1 Opinion of Fred Elefant, P.A. as to the legality of the Shares being
offered by the Selling Shareholders.
23.1 Consent of Fred Elefant, P.A. (included in the opinion filed as Exhibit
5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney (included as part of the signature page hereto).
</TABLE>
ITEM 17. UNDERTAKINGS.
A. RULE 415 OFFERING.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in the volume of securities offered (if the total dollar
value of securities offered would not exceed that which was registered)
and any deviation from the low or high and 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 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement.
II-2
<PAGE> 17
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this Section do
not apply if the Registration Statement is on Form S-3, Form S-8 or Form F-3
and the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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 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.
B. FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities offered
therein and the offering of such securities at that time shall be deemed the
initial bona fide offering thereof.
C. INDEMNIFICATION OF OFFICERS, DIRECTORS AND CONTROLLING PERSONS.
Insofar as indemnification for liabilities arising under the Securities
Act 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 Securities
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
Securities Act and will be governed by the final adjudication of such issue.
D. PROSPECTUS IN A REGISTRATION STATEMENT AT THE TIME OF EFFECTIVENESS.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus 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.
II-3
<PAGE> 18
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 Jacksonville, State of Florida, on July 21, 1997.
PHYSICIAN SALES & SERVICE, INC.
By: /s/ Patrick C. Kelly
-----------------------------
Name: Patrick C. Kelly
Title: Chairman and Chief Executive
Officer
II-4
<PAGE> 19
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Patrick
C. Kelly and David A. Smith, and each of them, as his or her true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution in each of them, for him or her and in his or her name, place
and stead, and in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement on Form
S-3 of Physician Sales & Service, Inc. or a registration statement filed
pursuant to Rule 462(b), and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or either of them,
or their 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 indicated on July 21, 1997.
<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
/s/ Patrick C. Kelly Chairman of the Board and Chief Executive Officer
- --------------------- (principal executive officer)
Patrick C. Kelly
/s/ David A. Smith Executive Vice President, Chief Financial Officer,
- --------------------- Assistant Secretary and Director (principal financial
David A. Smith and accounting officer)
- ---------------------
John F. Sasen, Sr. Director
/s/ Delmer W. Dallas
- --------------------- Director
Delmer W. Dallas
/s/ William C. Mason
- --------------------- Director
William C. Mason
/s/ T. O'Neal Douglas
- --------------------- Director
T. O'Neal Douglas
/s/ Fred Elefant
- --------------------- Director
Fred Elefant
- ---------------------
Delores P. Kesler Director
/s/ James L.L. Tullis
- --------------------- Director
James L.L. Tullis
</TABLE>
II-5
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Page
- ----------- ----------- -------------
<S> <C> <C>
4.1 Amended and Restated Articles of Incorporation, as amended, of
the Registrant (incorporated by reference from Registrant's
Registration Statement on Form S-3, effective November 13, 1995,
Registration No. 33-97524).
4.2 Amended and Restated Bylaws of the Registrant (incorporated by
reference from Registrant's Registration Statement on Form S-1,
Registration No. 33-76580).
5.1 Opinion of Fred Elefant, P.A. as to the legality of the Shares
being offered by the Selling Shareholders.
23.1 Consent of Fred Elefant, P.A. (including in the opinion filed as
Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney (included as part of the signature page hereto).
</TABLE>
<PAGE> 1
EXHIBIT 5.1
FRED ELEFANT, P.A.
1650 PRUDENTIAL DRIVE, SUITE 105
JACKSONVILLE, FLORIDA 32207
July 17, 1997
Physician Sales & Service, Inc.
4345 Southpoint Boulevard
Jacksonville, Florida 32216
Ladies and Gentlemen:
This opinion is given in connection with the filing by Physician Sales &
Service, Inc., a corporation organized and existing under the laws of the State
of Florida (the "Company"), of a Registration Statement on Form S-3 (the
"Registration Statement") with the Securities and Exchange Commission with
respect to the registration under the Securities Act of 1933, as amended, of
193,884 shares of Common Stock (the "Offering Shares") being sold by certain
selling stockholders of the Company.
In the capacity described above, I have considered such matters of law and
of fact, including the examination of originals or copies, certified or
otherwise identified to my satisfaction, of such records and documents of the
Company, certificates of public officials and such other documents as I have
deemed appropriate as a basis for the opinions hereinafter set forth. In
conducting my examination, I have assumed the genuineness of all signatures,
the legal capacity of all natural persons, the authenticity of all documents
submitted to me as originals, the conformity to original documents of all
documents submitted to me as certified or photostatic copies, and the
authenticity of the originals of such documents. The opinions set forth herein
are limited to the laws of the State of Florida.
Based upon the foregoing, it is my opinion that the Offering Shares have
been duly authorized and are validly issued, fully paid, and non-assessable by
the Company under the Business Corporation Act of the State of Florida as in
effect on the date hereof.
This opinion is provided to you for your benefit and for the benefit of
the Commission, in each case, solely with regard to the Registration Statement,
may be relied upon by you and the Commission only in connection with the
Registration Statement, and may not be relied upon by any other person or for
any other purpose without my prior written consent.
I consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference made to my firm under the caption "Legal
Matters" in the Prospectus constituting part of the Registration Statement.
FRED ELEFANT, P.A.
By: /s/ Fred Elefant
---------------------
Fred Elefant
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation by reference of our report dated May 27, 1997 included in
Physician Sales & Service, Inc.'s annual report on Form 10-K for the year ended
March 28, 1997 and to all references to our Firm.
/s/ Arthur Andersen LLP
Jacksonville, Florida
July 18, 1997
