<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 26, 1998
PSS WORLD MEDICAL, INC.
(Exact name of registrant
as specified in its charter)
Florida 0-23832 59-3500595
---------------------- ----------- ------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
4345 Southpoint Boulevard
Jacksonville, Florida 32216
--------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (904) 332-3000
Physician Sales & Service, Inc.
-------------------------------
(Former name or former address, if changed since last report)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On March 26, 1998 (the "Effective Date"), PSS World Medical, Inc., formerly
Physician Sales & Service, Inc. (the "Company" or "PSS"), Gulf South Medical
Supply, Inc. ("Gulf South") and PSS Merger Corp. ("Merger Sub") consummated the
merger (the "Merger") of Gulf South with and into Merger Sub pursuant to which
Gulf South became a wholly-owned subsidiary of PSS. The Merger was consummated
in accordance with that certain Agreement and Plan of Merger (the "Merger
Agreement") dated as of December 14, 1997 by and among, PSS, Gulf South and
Merger Sub.
Under the terms of the Merger Agreement, the Merger will result in the
issuance of approximately 28,738,297 shares of PSS common stock, par value $0.01
per share (the "PSS Common Stock"), to the stockholders of Gulf South. Gulf
South stockholders received or will receive 1.75 shares of PSS Common Stock for
each share of Gulf South common stock, par value $0.01 per share (the "Gulf
South Common Stock"), outstanding on the Effective Date. The exchange ratio of
1.75 was negotiated by the parties at the time they entered into the Merger
Agreement. Based on the closing price of PSS Common Stock on March 26, 1998, of
$23.00 per share, the shares issued in the Merger have a value of approximately
$661.0 million. In addition, PSS converted existing Gulf South options and
warrants into options and warrants to acquire approximately 3,787,762 shares of
PSS Common Stock.
The Merger has been accounted for as a pooling-of-interests and is expected
to be tax free to the Gulf South shareholders for federal income tax purposes.
Thomas G. Hixon, president of Gulf South, has joined PSS as President and Chief
Operating Officer and as a member of the PSS Board of Directors. In addition,
Donna C.E. Williamson, Melvin L. Hecktman and Hugh McNeil Brown joined the PSS
Board of Directors.
Approval of the issuance of the shares of PSS Common Stock pursuant to the
Merger required the affirmative vote of a majority of PSS' Common Stock present
and entitled to vote at the special meeting of the PSS shareholders held on
March 26, 1998. As of the record date, February 13, 1998, there were 40,984,705
shares of PSS Common Stock outstanding and entitled to vote at the special
meeting. At the special meeting, a majority of the shares of PSS Common Stock
were present and voted in favor of the issuance of the shares of PSS Common
Stock pursuant to the Merger.
Approval of the Merger required the affirmative vote of a majority of Gulf
South's Common Stock entitled to vote at the special meeting of Gulf South
shareholders held on March 26, 1998. As of the record date, February 13, 1998,
there were 16,354,964 shares of Gulf South's Common Stock outstanding and
entitled to vote at the Gulf South special meeting. At the special meeting, a
majority of the shares of Gulf South Common Stock were voted in favor of the
Merger.
Gulf South is a leading national distributor of medical supplies and
related products to the long-term care industry. Gulf South provides products
and services to approximately 10,500 long-term care facilities in all 50 states
through 23 regional distribution centers. PSS intends to continue to utilize
the assets of Gulf South in substantially the same manner as prior to the
Merger.
In connection with the Merger PSS also amended its Articles of
Incorporation to (i) increase its authorized shares of common stock from
60,000,000 to 150,000,000 and (ii) change its corporate name to "PSS World
Medical, Inc." Approval of the amendment to the Articles of Incorporation of
PSS to effect these changes required the affirmative vote of a majority of the
PSS Common Stock entitled to vote at the special meeting. At the PSS special
meeting, a majority of the shares of PSS Common Stock were present and voted in
favor of the amendments to the Articles of Incorporation.
-2-
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(A) FINANCIAL STATEMENTS OF THE BUSINESS ACQUIRED:
The financial statements required by this item were previously filed:
(i) in the Registrant's Form S-4 Registration Statement (No. 333-44323)
filed January 15, 1998 and amended February 25, 1998 (Pages F-33
through F-50); and
(ii) as Exhibit 99.2 to the Company's Current Report on Form 8-K dated
December 23, 1997.
(B) PRO FORMA FINANCIAL INFORMATION:
The Registrant hereby includes the following Pro Forma Financial
Information.
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
The unaudited pro forma condensed combined balance sheet as of December 31,
1997 has been prepared as if the Merger took place on that date. The unaudited
pro forma condensed combined income statements for the three years ended March
28, 1997 and for the nine months ended December 31, 1997 and 1996 have been
prepared as if the Merger had occurred on April 1, 1994. The unaudited pro forma
condensed combined financial statements are based on the separate historical
condensed financial statements of PSS and Gulf South giving effect to the
transaction under the assumptions and adjustments outlined in the accompanying
Notes to Unaudited Pro Forma Condensed Combined Financial Statements. The
unaudited pro forma condensed combined financial statements are provided for
comparative purposes only and are not necessarily indicative of the actual
results that would have been obtained had the Merger occurred on the dates
indicated or that may be achieved in the future. The unaudited pro forma
condensed combined financial statements should be read in conjunction with the
historical consolidated financial statements of PSS and Gulf South, including
the notes thereto.
-3-
<PAGE>
PRO FORMA CONDENSED COMBINED BALANCE SHEET
DECEMBER 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
----------- ----------------
PSS GULF SOUTH ADJUSTMENTS COMBINED(3)
---- ---------- ----------- -----------
DECEMBER 31, SEPTEMBER 30,
1997 1997(3)
----------- ---------
(in thousands)
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 35,077 $ 49,154 $ 84,231
Short-term investments 88,795 -- 88,795
Accounts receivable, net 154,970 54,055 209,025
Inventories 91,935 31,734 123,669
Prepaid expenses and other 30,718 2,982 33,700
-------- -------- -------------
Total current assets 401,495 137,925 539,420
Property and equipment, net 23,801 4,525 28,326
Intangibles, net 48,245 34,575 82,820
Other assets 12,117 3,132 15,249
-------- -------- -------------
Total assets $485,658 $180,157 $665,815
======== ======== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 68,015 $ 19,289 $ 87,304
Accrued expenses 25,910 3,856 29,766
Other 16,785 -- 16,785
-------- -------- -------------
Total current liabilities 110,710 23,145 133,855
Long-term debt and capital lease
obligations, net of current
maturities 129,089 -- 129,089
Other liabilities 3,449 -- 3,449
-------- -------- -------------
Total liabilities 243,248 23,145 266,393
-------- -------- -------------
Shareholders' equity:
Common stock 404 163 $ 122 (1) 689
Additional paid-in capital 224,180 115,727 (122) (1) 339,785
Retained earnings 17,556 41,122 58,688
Cumulative foreign currency
translation adjustment 260 -- 260
-------- -------- -------------
Total shareholders' equity 242,410 157,012 (0) 399,422
-------- -------- --------- -------------
Total liabilities and shareholders'
equity $485,658 $180,157 $ 0 $665,815
======== ======== ========= =============
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-4-
<PAGE>
PRO FORMA CONDENSED COMBINED INCOME STATEMENT
FOR THE NINE MONTHS ENDED DECEMBER 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
-------------- ------------------------
PSS GULF SOUTH ADJUSTMENTS COMBINED(3)
-------------- ------------- ------------ ----------
December 31, September 30,
1997 1997(3)
------------------ ---------------
(in thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales $733,882 $ 205,039 $938,921
Cost of goods sold 533,054 158,153 691,207
-------- --------- --------
Gross profit 200,828 46,886 247,714
Selling, general and
administrative expenses 171,251 27,893 199,144
Merger costs and expenses 5,625 -- 5,625
Non-recurring ESOP cost of acquired
company 2,457 -- 2,457
-------- --------- --------
Income from operations 21,495 18,993 40,488
-------- --------- --------
Other income (expense):
Net interest (expense) income (1,234) 1,438 204
Other income 3,429 -- 3,429
-------- --------- --------
2,195 1,438 3,633
-------- --------- --------
Income before income taxes 23,690 20,431 44,121
Provision for income taxes 9,973 7,766 17,739
-------- --------- --------
Net income $ 13,717 $ 12,665 $ 26,382
======== ========= ========
Earnings per share:
Basic $0.35 $0.76(2) $0.38
======== ========= ========
Diluted $0.34 $0.76(2) $0.38
======== ========= ========
Weighted average shares:
Basic 39,689 16,576(2) 12,432(1) 68,697
======== ========= ======== ========
Diluted 40,120 16,576(2) 12,432(1) 69,128
======== ========= ======== ========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-5-
<PAGE>
PRO FORMA CONDENSED COMBINED INCOME STATEMENT
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------ -------------
PSS GULF SOUTH ADJUSTMENTS COMBINED
------------ ------------- ------------ --------
DECEMBER 31, DECEMBER 31,
1996 1996
------------ -------------
<S> <C> <C> <C> <C>
(in thousands, except per share data)
Net sales $558,018 $ 137,475 $695,493
Cost of goods sold 405,914 105,697 511,611
-------- --------- --------
Gross profit 152,104 31,778 183,882
Selling, general and administrative
expenses 134,511 18,261 152,772
Merger costs and expenses 7,251 1,866 9,117
Non-recurring ESOP cost of acquired
company 1,050 -- 1,050
-------- --------- --------
Income from operations 9,292 11,651 20,943
-------- --------- --------
Other income:
Net interest income 1,071 1,594 2,665
Other income 1,350 -- 1,350
-------- --------- --------
2,421 1,594 4,015
-------- --------- --------
Income before income taxes 11,713 13,245 24,958
Provision for income taxes 4,519 4,873 9,392
-------- --------- --------
Net income $ 7,194 $ 8,372 $ 15,566
======== ========= ========
Earnings per share:
Basic $0.19 $0.53(2) $0.24
======== ========= ========
Diluted $0.19 $0.53(2) $0.24
======== ========= ========
Weighted average shares:
Basic 37,153 15,877(2) 11,908(1) 64,938
======== ========= ======== ========
Diluted 37,845 15,877(2) 11,908(1) 65,630
======== ========= ======== ========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-6-
<PAGE>
PRO FORMA CONDENSED COMBINED INCOME STATEMENT
FOR THE YEAR ENDED MARCH 28, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------ ---------------------
PSS GULF SOUTH ADJUSTMENTS COMBINED
------------ ---------- ----------- --------
(in thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales $763,054 $ 202,084 $965,138
Cost of goods sold 558,164 155,616 713,780
-------- --------- --------
Gross profit 204,890 46,468 251,358
Selling, general and administrative
expenses 187,441 27,359 214,800
Merger costs and expenses 12,128 1,866 13,994
Non-recurring ESOP cost of acquired
company 1,446 -- 1,446
-------- --------- --------
Income from operations 3,875 17,243 21,118
-------- --------- --------
Other income (expense):
Interest expense (1,188) (189) (1,377)
Interest and investment income 2,419 2,248 4,667
Other income 1,537 -- 1,537
-------- --------- --------
2,768 2,059 4,827
-------- --------- --------
Income before income taxes 6,643 19,302 25,945
Provision for income taxes 2,216 7,119 9,335
-------- --------- --------
Net income $ 4,427 $ 12,183 $ 16,610
======== ========= ========
Earnings per share
Basic $0.12 $0.76(2) $0.25
======== ========= ========
Diluted $0.12 $0.76(2) $0.25
======== ========= ========
Weighted average shares
Basic 37,496 16,042(2) 12,032(1) 65,569
======== ========= ======== ========
Diluted 38,015 16,042(2) 12,032(1) 66,089
======== ========= ======== ========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-7-
<PAGE>
PRO FORMA CONDENSED COMBINED INCOME STATEMENT
FOR THE YEAR ENDED MARCH 29, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------ ---------------------
PSS GULF SOUTH ADJUSTMENTS COMBINED
------------ ---------- ----------- --------
(in thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales $589,120 $ 140,807 $729,927
Cost of goods sold 426,530 106,477 533,007
-------- --------- --------
Gross profit 162,590 34,330 196,920
Selling, general and administrative
expenses 141,160 19,371 160,531
Merger costs and expenses 15,732 512 16,244
Non-recurring ESOP cost of acquired
company 850 -- 850
-------- --------- --------
Income from operations 4,848 14,447 19,295
-------- --------- --------
Other income (expense):
Interest expense (3,568) (220) (3,788)
Interest and investment income 1,188 104 1,292
Other income 1,586 -- 1,586
-------- --------- --------
(794) (116) (910)
-------- --------- --------
Income before income taxes 4,054 14,331 18,385
Provision for income taxes 1,925 5,750 7,675
-------- --------- --------
Net income $ 2,129 $ 8,581 $ 10,710
======== ========= ========
Earnings per share:
Basic $0.07 $0.61(2) $0.19
======== ========= ========
Diluted $0.06 $0.61(2) $0.19
======== ========= ========
Weighted average shares
Basic 31,591 14,019(2) 10,514(1) 56,124
======== ========= ======== ========
Diluted 32,870 14,019(2) 10,514(1) 57,403
======== ========= ======== ========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-8-
<PAGE>
PRO FORMA CONDENSED COMBINED INCOME STATEMENT
FOR THE YEAR ENDED MARCH 30, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------ ---------------------
PSS GULF SOUTH ADJUSTMENTS COMBINED
------------ ---------- ----------- --------
(in thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales $471,985 $ 101,107 $573,092
Cost of goods sold 339,670 75,070 414,740
-------- --------- --------
Gross profit 132,315 26,037 158,352
Selling, general and administrative
expenses 121,407 14,902 136,309
Restructuring charges 4,389 -- 4,389
Non-recurring ESOP cost of acquired
company 832 -- 832
-------- --------- --------
Income from operations 5,687 11,135 16,822
-------- --------- --------
Other income (expense):
Interest expense (4,506) (116) (4,622)
Interest and investment income 5 245 250
Other income 1,912 -- 1,912
-------- --------- --------
(2,589) 129 (2,460)
-------- --------- --------
Income before income taxes 3,098 11,264 14,362
Provision for income taxes 3,038 4,510 7,548
-------- --------- --------
Net income $ 60 $ 6,754 $ 6,814
======== ========= ========
Earnings per share:
Basic $0.00 $0.49(2) $0.14
======== ========= ========
Diluted $0.00 $0.49(2) $0.14
======== ========= ========
Weighted average shares:
Basic 24,027 13,851(2) 10,388(1) 48,266
======== ========= ======== ========
Diluted 25,101 13,851(2) 10,388(1) 49,340
======== ========= ======== ========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Combined Financial
Statements.
-9-
<PAGE>
NOTES TO UNAUDITED PRO FORM CONDENSED COMBINED FINANCIAL STATEMENTS
The unaudited pro forma condensed combined financial statements have
been prepared by combining the historical balances of PSS and the historical
balances of Gulf South as recast to a conforming March year end. The following
notes describe the pro forma adjustments and other items relevant to such
statements.
MERGER COSTS AND EXPENSES AND ANTICIPATED COST SAVINGS
Certain expenses are expected to be incurred in connection with the
consolidation and restructuring of PSS and Gulf South. Such activities will
include consolidation costs from the closing of duplicate facilities, realigning
regional and corporate functions, consolidating information systems and reducing
personnel. The expenses associated with these activities cannot be currently
estimated with a reasonable degree of accuracy, but preliminary estimates
indicate that these expenses may range between $35 million and $45 million.
Income tax benefits at the statutory rate resulting from these charges range
between $14 million and $18 million. The estimated costs associated with the
restructuring activities will be expensed in the period in which the companies
complete the restructuring plan.
Efficiencies and net cost savings are expected to result from the
consolidation and restructuring. The unaudited pro forma condensed combined
financial statements do not reflect such efficiencies and savings.
PRO FORMA ADJUSTMENTS
(1) Shareholders' Equity and Earnings Per Share
Shareholders' equity and weighted average common share amounts
represent the aggregate weighted average shares of PSS after the Merger,
adjusted to reflect the exchange ratio of 1.75 shares of PSS Common Stock for
each share of Gulf South Common Stock.
(2) Gulf South Weighted Average Shares and Earnings per Share
Weighted average shares and earnings per share amounts for Gulf South
are computed under APB No. 15. Gulf South is not permitted to report basic and
diluted weighted average shares and earnings per shares amounts as early
application of Statement of Financial Accounting Standards No. 128, "Earnings
Per Share," is prohibited.
(3) Gulf South Historical and Pro Forma Combined
Amounts for Gulf South are presented as of September 30, 1997 and for
the nine months ended September 30, 1997, as December 31, 1997 information is
not available for Gulf South.
-10-
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(CONTINUED).
(C) EXHIBITS
2.1 Agreement and Plan of Merger dated as of December 14,
1997 by and among Physician Sales & Service, Inc., PSS Merger Corp.
and Gulf South Medical Supply, Inc. (filed as Annex A to the Joint
Proxy Statement/Prospectus filed as part of the Registrant's Form S-4
Registration Statement (No. 333-44323) filed January 15, 1998 and
amended February 25, 1998, and incorporated herein by reference).
3.1 Amended and Restated Articles of Incorporation, as
amended, of the Registrant.
4.1 Form of Specimen Certificate of PSS World Medical, Inc.
Common Stock
-11-
<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.
PSS WORLD MEDICAL, INC.
BY:/S/ DAVID A. SMITH
------------------
DAVID A. SMITH
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
DATED: APRIL 7, 1998
-12-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Number DESCRIPTION PAGE
- ---------------- --------------------------------------------------------------- ----------------
<S> <C> <C>
2.1 Agreement and Plan of Merger dated as of December 14, 1997 by
and among Physician Sales & Service, Inc., PSS Merger Corp.
and Gulf South Medical Supply, Inc. (filed as Annex A to the
Joint Proxy Statement/Prospectus filed as part of the
Registrant's Form S-4 Registration Statement (No. 333-44323)
filed January 15, 1998 and amended February 25, 1998, and
incorporated herein by reference).
3.1 Amended and Restated Articles of Incorporation, as amended, of
the Registrant.
4.1 Form of Specimen Certificate of PSS World Medical, Inc. Common
Stock.
</TABLE>
-13-
<PAGE>
Exhibit 3.1
AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
PHYSICIAN SALES & SERVICE, INC.
ARTICLE I. NAME
----------------
The name of the corporation is Physician Sales & Service, Inc.
(hereinafter referred to as the "Corporation").
ARTICLE II. BUSINESS
---------------------
The general nature of the business or businesses to be
transacted, conducted and carried on by the Corporation shall be to engage
in any activity or business permitted under the laws of Florida. Its
business shall be conducted in the United States and its possessions and in
all foreign countries, wherever necessary or convenient.
ARTICLE III. CAPITAL STOCK
---------------------------
The maximum number of shares of stock which the Corporation is
authorized to have outstanding at any one time is 20,000 shares of common
stock having a par value of $.01 per share ("Common Stock") and 1,000,000
shares of preferred stock having a par value of $.01 per share ("Preferred
Stock"). The Board of Directors shall have full authority to establish one
or more series of Preferred Stock and to establish, by filing with the
Secretary of State of Florida, the designation of each such series and the
variation in rights, preferences and limitations for each such series.
ARTICLE IV. PRE-EMPTIVE RIGHTS
-------------------------------
Holders of shares of the Corporation's capital stock of any kind,
class or series shall not have any pre-emptive right to acquire any shares
of the Corporation's capital stock of any kind, class or series or any
other securities or obligations of the Corporation whether now or hereafter
authorized.
ARTICLE V. TERM
----------------
The term for which the Corporation is formed is and shall be
perpetual or until dissolved according to law.
<PAGE>
ARTICLE VI. REGISTERED OFFICE AND AGENT
----------------------------------------
The registered office of the Corporation in the State of Florida
is 1650 Prudential Drive, Suite 105, Jacksonville, Florida 32207. The name
of the registered agent of the Corporation at that address is Fred Elefant,
Esq.
ARTICLE VII. BOARD OF DIRECTORS
--------------------------------
All corporate powers shall be exercised by or under the authority
of, and the business and affairs of the Corporation shall be managed under
the direction of, the Board of Directors. The number of directors shall be
fixed from time to time by the consent of three-fifths of the Board of
Directors. The directors shall be divided into three classes: Class I,
Class II, and Class III. The number of directors included in each such
class shall be as nearly equal as may be possible. At a Special Meeting of
Shareholders held in 1994, Class I directors shall be initially elected for
a three-year term, Class II directors for a two-year term and Class III
directors for a one-year term; provided, however, that each such Class I,
Class II or Class III director shall hold office until his or her successor
is elected and qualified or until his or her earlier death, resignation or
removal from office. At each succeeding annual meeting of the shareholders
of the Corporation, commencing in 1995, the directors elected to succeed
those directors whose terms then expire shall belong to the same class as
the directors they succeed and shall hold office unfit the third succeeding
annual meeting of shareholders or unfit their earlier death, resignation or
removal from office. Any increase or decrease in the number of directors
shall be apportioned by the Board of Directors among the classes so that
the number of directors included in each such class shall continue to be as
nearly equal as possible.
Notwithstanding the foregoing, and except as otherwise required
by law, whenever the holders of any one or more series of Preferred Stock
shall have the right, voting separately as a class, to elect one or more
directors of the Corporation, the terms of the director or directors
elected by such holders shall expire at the next succeeding annual meeting
of shareholders and vacancies created with respect to any directorship of
the directors so elected may be filled in the manner specified by the
certificate of designation for such Preferred Stock.
A director may be removed with or without cause only by the
affirmative vote of the holders of at least four-fifths of the outstanding
shares of capital stock of the Corporation then entitled to vote in an
election of directors ("Voting Stock"), which vote may only be taken at a
meeting of shareholders called expressly for that purpose, except that if
the Board of Directors recommends to the shareholders, by an affirmative
vote of at least three-fifths of the whole Board of Directors, removal with
or without cause of a director, such removal may be effected by the
affirmative vote of the holders of a majority of the Voting Stock.
Notwithstanding anything contained in these Articles of
Incorporation to the contrary, the affirmative vote of the holders of at
least four-fifths of the Voting Stock shall be required to alter, amend or
adopt any provision inconsistent with, or to repeal, this Article VII.
ARTICLE VIII. GREATER QUORUM OR VOTING REQUIREMENT
---------------------------------------------------
If the shareholders have adopted or amended a provision of these
Articles of Incorporation or the Corporation's Bylaws that fixes a greater
quorum or voting requirement for shareholders or voting groups of
<PAGE>
shareholders than is required by Florida law, the adoption or amendment of
such provision of these Articles or the Corporation's Bylaws that adds,
changes or deletes a greater quorum or voting requirement for shareholders
must meet the same quorum requirement and be adopted by the same vote and
voting groups required to take action under the quorum and voting
requirements then in effect or proposed to be adopted, whichever is
greater. Any provision of the Corporation's Bylaws which fixes a greater
quorum or voting requirement for shareholders may not be adopted, amended
or repealed by the Board of Directors.
ARTICLE IX. FAIR PRICE PROVISION
---------------------------------
(1)(A) In addition to any affirmative vote required by law or
these Articles of Incorporation, and except as otherwise expressly provided
in paragraph 2 of this Article IX, any Business Combination (as defined in
subparagraph (B) of this paragraph 1) shall require the affirmative vote of
the holders of at least eighty percent (80%) of the Voting Stock, voting
together as a single class. Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that a lesser
percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise. Notwithstanding any other provision of
these Articles of Incorporation to the contrary, for purposes of this
Article IX, each share of the Voting Stock shall have one vote.
(B) The term "Business Combination" as used in this Article
IX shall mean any of the following transactions:
(i) any merger or consolidation of the Corporation or any
Subsidiary (a hereinafter defined) with (a) any Interested
Shareholder (as hereinafter defined) or (b) any other corporation
(whether or not itself an Interested Shareholder) which is, or
after such merger or consolidation would be, an Affiliate (as
hereinafter defined) of an Interested Shareholder, or
(ii) any sale, lease, exchange, mortgage, pledge, transfer or
other disposition (in one transaction or a series of
transactions) to or with any Interested Shareholder or any
Affiliate of any Interested Shareholder of any assets of the
Corporation or any Subsidiary having an aggregate Fair Market
Value (as hereinafter defined) of $1,000,000 or more; or
(iii) the issuance or transfer by the Corporation (in one
transaction or a series of transactions) of any securities of the
Corporation or any Subsidiary to any Interested Shareholder or
any Affiliate of any Interested Shareholder in exchange for cash,
securities or other property (or a combination thereof) having an
aggregate Fair Market Value of $1,000,000 or more; or
(iv) the adoption of any plan or proposal for the liquidation
or dissolution of the Corporation proposed by or on behalf of an
Interested Shareholder or any Affiliate of any Interested
Shareholder; or
(v) any reclassification of securities (including any reverse
stock split), or recapitalization of the Corporation, or any
merger or consolidation of the Corporation with any Subsidiary or
any other transaction (whether or not with or into or otherwise
involving an Interested Shareholder) which has the effect,
directly or indirectly, of increasing the proportionate share of
<PAGE>
the outstanding shares of any class of equity or convertible
securities of the Corporation or any subsidiary which is directly
or indirectly owned by any Interested Shareholder or any
Affiliate of any Interested Shareholder.
(2) The provisions of paragraph 1 of this Article IX shall not
be applicable to any particular Business Combination, and such Business
Combination shall require only such affirmative vote as is required by law
and any other provision of these Articles of Incorporation, if all of the
conditions specified in either of the following subparagraphs (A) and (B),
are met:
(A) The Business Combination shall have been approved by a
majority of the Disinterested Directors (as hereinafter defined).
(B) All of the following conditions shall have been met:
(i) The aggregate amount of (x) cash and (y) Fair Market
Value as of the date of the consummation of the Business
Combination of consideration other than cash, to be received per
share by holders of the Corporation's Common Stock in such
Business Combination shall be at least equal to the highest
amount determined under subclauses (a) and (b) below:
(a) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid by the Interested Shareholder for any
share of Common Stock acquired by it (1) within the two-year
period immediately prior to the first public announcement of
the proposal of the Business Combination (the "Announcement
Date") or (2) in the transaction in which it became an
Interested Shareholder, whichever is higher;
(b) the Fair Market Value per share of Common Stock on the
Announcement Date or on the date on which the Interested
Shareholder became an Interested Shareholder (such latter
date referred to in this Article IX as the "Determination
Date"), whichever is higher.
(ii) The aggregate amount of (x) cash and (y) Fair Market
Value as of the date of the consummation of the Business
Combination of consideration other than cash, to be received per
share by holders of shares of any class of the Corporation's
Preferred Stock outstanding shall be at least equal to the
highest amount determined under subclauses (a), (b) or (c) below:
(a) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid by the Interested Shareholder for any
shares of such class of Preferred Stock acquired by it (1)
within the two-year period immediately prior to the
Announcement Date or (2) in the transaction in which it
became an Interested Shareholder, whichever is higher;
(b) the highest preferential amount per share to which the
holders of shares of such class of Preferred Stock would be
entitled in the event of any voluntary or involuntary
<PAGE>
liquidation, dissolution or winding up of the affairs of the
Corporation, regardless of whether the Business Combination
to be consummated constitutes such an event; or
(c) the Fair Market Value per share of such class of
Preferred Stock on the Announcement Date or on the
Determination Date, whichever is highest.
The provisions of this subparagraph (B)(ii) shall be
required to be met with respect to every class of outstanding
Preferred Stock, whether or not the Interested Shareholder has
previously acquired any shares of a particular class of Preferred
Stock.
(iii) The consideration to be received by holders of a
particular class of outstanding Voting Stock shall be in cash or
in the same form as the Interested Shareholder has previously
paid for shares of such class of Voting Stock. If the Interested
Shareholder has paid for shares of any class of Voting Stock with
varying forms of consideration, the form of consideration for
such class of Voting Stock shall be either cash or the form used
to acquire the largest number of shares of such class of Voting
Stock previously acquired by it.
(iv) After such Interested Shareholder has become an
Interested Shareholder and prior to the consummation of such
Business, Combination: (a) except as approved by a majority of
the Disinterested Directors, there shall have been no failure to
declare and pay at the regular date therefor any full quarterly
dividends (whether or not cumulative) on the outstanding
Preferred Stock; (b) there shall have been (1) no reduction in
the annual rate of dividends paid on the Common Stock (except as
necessary to reflect any subdivision of the Common Stock), except
as approved by a majority of the Disinterested Directors, and (2)
an increase in such annual rate of dividends as necessary to
reflect any reclassification (including any reverse stock split),
recapitalization, reorganization or any similar transaction which
has the effect of reducing the number of outstanding shares of
the Common Stock, unless the failure so to increase such annual
rate is approved by a majority of the Disinterested Directors;
and (c) such Interested Shareholder shall not have become the
beneficial owner of any additional shams of Voting Stock except
as part of the transaction which results in such Interested
Shareholder becoming an Interested Shareholder.
(v) After such Interested Shareholder has become an
Interested Shareholder, such Interested Shareholder shall not
have received, the benefit, directly or indirectly (except
proportionately as a shareholder), of any loans, advances,
guarantees, pledges or other financial assistance or any tax
credits or other tax advantages provided by the Corporation,
whether in anticipation of or in connection with such Business
Combination or otherwise.
(vi) A proxy or information statement describing the proposed
Business Combination and complying with the requirements of the
Securities Exchange Act of 1934, as amended (together with any
successor thereto, the "Exchange Act") and the rules and
regulations thereunder shall be mailed to any public shareholders
of the Corporation at least thirty (30) days prior to the
consummation of such Business Combination (whether or not such
<PAGE>
proxy or information statement is required to be mailed pursuant
to the Exchange Act).
(3) For the purposes of this Article IX:
(A) The term "Affiliate" shall have the meaning given to it
in Rule 12b-2 of the Exchange Act.
(B) A person shall be a "beneficial owner" of any Voting
Stock (i) which such person or any of its Affiliates beneficially
owns, directly or indirectly; or (ii) which such person or my of its
Affiliates has (x) the right to acquire (whether such right is
exercisable immediately or only after the passage of time), pursuant
to any agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise,
or (y) the right to vote pursuant to any agreement, arrangement or
understanding; or (iii) which is beneficially owned, directly or
indirectly, by any other person with which such person or any of its
Affiliates has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of any such share
of Voting Stock. For the purposes of determining whether a person is
an Interested Shareholder pursuant to subparagraph (E) of this
paragraph 3, the number of shares of Voting Stock deemed to be
outstanding shall include shares deemed owned through application of
subparagraph (E) of this paragraph 3 but shall not include any other
shares of Voting Stock which may be issuable pursuant to any
agreement, arrangement or understanding, or upon exercise of
conversion rights, warrants or options, or otherwise.
(C) The term "Disinterested Director" means any member of the
Board of Directors who is unaffiliated with the Interested Shareholder
and was a member of the Board of Directors prior to the time that the
Interested Shareholder became an Interested Shareholder, and any
successor of a Disinterested Director who is unaffiliated with the
Interested Shareholder and is recommended to succeed a Disinterested
Director by a majority of Disinterested Directors then on the Board of
Directors.
(D) The term, "Fair Market Value" means: (i) in the case of
stock, the highest closing sale price during the thirty (30) day
period immediately preceding the date in question of a share of such
stock on the principal United States securities exchange registered
under the Exchange Act on which such stock is listed, or, if such
stock is not listed on any such exchange, the highest closing bid
quotation with respect to a share of such stock during the thirty (30)
day period preceding the date in question on the National Association
of Securities Dealers, Inc. Automated Quotations System or any system
then in use, or if no such quotations are available, the fair market
value on the date in question of a share of such stock as determined
in good faith by a majority of the Disinterested Directors; and (ii)
in the case of property other than cash or stock, the fair market
value of such property on the date in question as determined in good
faith by a majority of Disinterested Directors.
(E) The term "Interested Shareholder" (other than the
Corporation, any Subsidiary, the Corporation or any Subsidiary acting
as a Trustee or in a similar fiduciary capacity, or any person who
would have met the definition of an Interested Shareholder as of March
1, 1994) means any person who or which (a) is the beneficial owner of
more than 10% of the voting power of the outstanding Voting Stock; or
<PAGE>
(b) is an Affiliate of the Corporation and at any time within the two-
year period immediately prior to the date in question was the
beneficial owner of 10% or more of the voting power of the then
outstanding Voting Stock; or (c) is an assignee of or has otherwise
succeeded to any shares of Voting Stock which were at any time within
the two-year period immediately prior to the date in question
beneficially owned by any Interested Shareholder, if such assignment
or succession shall have occurred in the course of a transaction or
series of transactions not involving a public offering within the
meaning of the Securities Act of 1993, as amended.
(F) In the event of any Business Combination in which the
Corporation survives, the phrase "other consideration to be received"
as used in subparagraphs (B)(i) and (ii) of paragraph 2 of this
Article IX shall include the shares of Common Stock and/or the shares
of any other class of Voting Stock retained by the holders of such
shares.
(G) The term "Subsidiary" means any corporation of which a
majority of any class of equity security is owned, directly or
indirectly, by the Corporation unless owned by the Corporation as
trustee or in a similar fiduciary capacity; provided, however, that
for the purposes of the definition of Interested Shareholder set forth
in subparagraph (E) of this paragraph, the term "Subsidiary" shall
mean only a corporation of which a majority of each class of equity
security is owned, directly or indirectly, by the Corporation.
(4) Nothing contained in this Article IX shall be construed to
relieve any Interested Shareholder from any fiduciary obligation imposed by
law.
(5) Notwithstanding any other provisions of these Articles of
Incorporation or the Bylaws of the Corporation (and notwithstanding the
fact that a lesser percentage may be specified by law, these Articles of
Incorporation or the Bylaws of the Corporation), the affirmative vote of
the holders of eighty percent (80%) or more of the shares of Voting Stock,
voting together as a single class, shall be required to alter, amend or
adopt any provisions inconsistent with, or to repeal, this Article IX.
ARTICLE X. INDEMNIFICATION
---------------------------
The Corporation shall indemnify officers and directors to the
fullest extent permitted by law.
<PAGE>
ARTICLES OF AMENDMENT
TO THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF PHYSICIAN SALES & SERVICE, INC.
1.
The name of the corporation is Physician Sales & Service, Inc.
2.
Article III of the Amended and Restated Articles of Incorporation of
the corporation is hereby deleted in its entirety, and the following new Article
III is hereby substituted in its place:
"ARTICLE III. CAPITAL STOCK
--------------------------
The maximum number of shares of stock which the Corporation is
authorized to have outstanding at any one time is 60,000,000 shares of
common stock having a par value of $0.0033 per share ("Common Stock") and
1,000,000 shares of preferred stock having a par value of $0.01 per share
("Preferred Stock"). The Board of Directors shall have full authority to
establish one or more series of Preferred Stock and to establish, by filing
with the Secretary of State of Florida, the designation of each such series
and the variations in rights, preferences and limitations for each such
series."
3.
The date of the foregoing amendment's adoption was September 8, 1995.
The foregoing amendment was duly approved by the board of directors of
the corporation without shareholder action in accordance with the provisions of
Florida Business Corporation Act Section 607.10025. Shareholder action was not
required.
IN WITNESS WHEREOF, the undersigned has caused these Articles
of Amendment to be duly executed as of September 8, 1995.
/s/ Patrick C. Kelly
---------------------
Patrick C. Kelly
Director and Chief Executive Officer
of Physician Sales & Service, Inc.
<PAGE>
ARTICLES OF AMENDMENT
TO THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF PHYSICIAN SALES & SERVICE, INC.
1.
The name of the corporation is Physician Sales & Service, Inc.
2.
Article III of the Amended and Restated Articles of Incorporation of
the corporation is hereby deleted in its entirety, and the following new Article
III is hereby substituted in its place:
"ARTICLE III. CAPITAL STOCK
--------------------------
The maximum number of shares of stock which the Corporation is
authorized to have outstanding at any one time is 60,000,000 shares of
common stock having a par value of $0.01 per share ("Common Stock") and
1,000,000 shares of preferred stock having a par value of $0.01 per share
("Preferred Stock"). The Board of Directors shall have full authority to
establish one or more series of Preferred Stock and to establish, by filing
with the Secretary of State of Florida, the designation of each such series
and the variations in rights, preferences and limitations for each such
series."
3.
The date of the foregoing amendment's adoption was September 8, 1995.
The foregoing amendment was duly approved by the board of directors of
the corporation without shareholder action in accordance with the provisions of
Florida Business Corporation Act Section 607.1002. Shareholder action was not
required.
IN WITNESS WHEREOF, the undersigned has caused these Articles of
Amendment to be duly executed as of September 8, 1995.
/s/ Patrick C. Kelly
---------------------
Patrick C. Kelly
Director and Chief Executive Officer
of Physician Sales & Service, Inc.
<PAGE>
ARTICLES OF AMENDMENT
TO THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF PHYSICIAN SALES & SERVICE, INC.
1.
The name of the corporation is Physician Sales & Service, Inc.
2.
Article I of the Amended and Restated Articles of Incorporation of the
corporation is hereby deleted in its entirety and the following new Article I is
hereby substituted in its place.
"ARTICLE I. NAME
----------------
The name of the corporation is PSS World Medical, Inc. (hereinafter
referred to as the "Corporation")."
3.
Article III of the Amended and Restated Articles of Incorporation of
the corporation is hereby deleted in its entirety, and the following new Article
III is hereby substituted in its place:
"ARTICLE III. CAPITAL STOCK
---------------------------
The maximum number of shares of stock which the Corporation is
authorized to have outstanding at any one time is 150,000,000 shares of
common stock having a par value of $0.01 per share ("Common Stock") and
1,000,000 shares of preferred stock having a par value of $0.01 per share
("Preferred Stock"). The Board of Directors shall have full authority to
establish one or more series of Preferred Stock and to establish, by filing
with the Secretary of State of the State of Florida, the designation of
each such series and the variations in rights, preferences and limitations
for each such series."
4.
The date of the foregoing amendments' adoption was March 26, 1998.
5.
The foregoing amendments were duly approved by the stockholders of the
corporation at a special meeting of stockholders held on March 26, 1998. At
such meeting, the number of votes cast for the amendments by the shareholders
was sufficient for approval of such amendments.
<PAGE>
IN WITNESS WHEREOF, the undersigned has caused these Articles of
Amendment to be duly executed as of March 26th,1998.
/s/ Patrick C. Kelly
---------------------
Patrick C. Kelly
Chairman of the Board and Chief Executive Officer
of Physician Sales & Service, Inc.
<PAGE>
EXHIBIT 4.1
COMMON STOCK COMMON STOCK
INCORPORATED UNDER THE LAWS SEE REVERSE FOR
OF THE STATE OF FLORIDA CERTAIN DEFINITIONS
CUSIP 69366A 10 0
PSS
PSS WORLD MEDICAL, INC.
THIS CERTIFIES THAT
IS THE OWNER OF
FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK, PAR VALUE $.01 PER
SHARE, OF
PSS WORLD MEDICAL, INC. (hereinafter referred to as the "Corporation"),
transferable on the books of the Corporation by the holder hereof in person or
by duly authorized attorney upon surrender of this certificate properly
endorsed. This certificate and the shares represented hereby are issued and
shall be held subject to all of the provisions of the Certificate of
Incorporation, as amended, of the Corporation to all of which the holder by
acceptance hereof assents. This certificate is not valid until countersigned by
the Transfer Agent and registered by the Registrar.
In Witness Whereof, the said Corporation has caused this certificate to be
signed by its duly authorized officers and its Corporate seal to be hereunto
affixed.
Dated:
Fred Elefant Patrick C. Kelly
Secretary Chairman of the Board
and Chief Executive Officer
PSS WORLD MEDICAL, INC.
The Corporation will furnish without charge to each stockholder who so
requests the designations, preferences and relative, participating optional or
other special rights of each class of stock or series thereof which the
Corporation is authorized to issue, and the qualifications limitations or
restrictions of such preferences and/or rights. Any such request may be made to
the Corporation or the Transfer Agent.
<PAGE>
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<CAPTION>
<S> <C> <C>
TEN COM -- AS TENANTS IN COMMON UNIF GIFT MIN ACT_______ CUSTODIAN _______
TEN ENT -- AS TENANTS BY THE ENTIRETIES (CUST) (MINOR)
JT TEN -- AS JOINT TENANTS WITH RIGHT UNDER UNIFORM GIFTS TO MINORS
MINOR SURVIVORSHIP AND NOT AS ACT
TENANTS IN COMMON --------------------------
(STATE)
</TABLE>
ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE ABOVE LIST.
FOR VALUE RECEIVED, _________________________________ HEREBY SELL, ASSIGN AND
TRANSFER UNTO
___________________
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
/___________________/
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
______________________________________________________ SHARES OF THE CAPITAL
STOCK REPRESENTED BY THE WITHIN CERTIFICATE, AND DO HEREBY IRREVOCABLY
CONSTITUTE AND APPOINT
_____________________________________________________________________
ATTORNEY TO TRANSFER THE SAID STOCK ON THE BOOKS OF THE WITHIN-NAMED CORPORATION
WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.
DATED, _____________________
NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: _____________________________________________
THIS SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS
AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17AD-15.
