AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 1, 1998
REGISTRATION NO. 333-56253
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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POST-EFFECTIVE
AMENDMENT NO. 1
ON
FORM S-3
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ACCESS HEALTH, INC.
(Exact name of Registrant as specified in its charter)
--------------------------
DELAWARE 68-0163589
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
335 INTERLOCKEN PARKWAY
BROOMFIELD, CO 80021
(303) 466-9500
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
--------------------------
TIMOTHY H. CONNOR
SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
ACCESS HEALTH, INC.
335 INTERLOCKEN PARKWAY
BROOMFIELD, CO 80021
(303) 466-9500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPIES TO:
JULIE A. BROOKS, ESQ. BARRY E. TAYLOR, ESQ.
SENIOR VICE PRESIDENT AND ROBERT G. O'CONNOR, ESQ.
GENERAL COUNSEL STEVEN LIU, ESQ.
ACCESS HEALTH, INC. WILSON SONSINI GOODRICH & ROSATI
335 INTERLOCKEN PARKWAY PROFESSIONAL CORPORATION
BROOMFIELD, CO 80021 650 PAGE MILL ROAD
(303) 466-9500 PALO ALTO, CA 94304
(650) 493-9300
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this 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. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box./ /
--------------------------
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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P_R_O_S_P_E_C_T_U_S
1,000,000 SHARES
[LOGO]
COMMON STOCK
---------------------
This Prospectus relates to the public offering, which is not being
underwritten, from time to time by certain stockholders of the Company or by
pledgees, donees, transferees or other successors in interest that receive such
shares as a gift, partnership distribution or other non-sale related transfer
(the "Selling Stockholders") of up to 1,000,000 shares of Common Stock, par
value $0.001 per share (the "Shares"), of Access Health, Inc. ("Access Health"
or the "Company"), held by certain Selling Stockholders. See "Selling
Stockholders." The Company will receive no part of the proceeds of such sales.
All of the shares were originally issued by the Company to the Selling
Stockholders as consideration for the acquisition of InterQual, Inc.
("InterQual") on June 30, 1998. The Shares are being registered by the Company
pursuant to registration rights granted to the Selling Stockholders. See "Recent
Developments" for a discussion of the Company's acquisition of InterQual.
The Selling Stockholders have not advised the Company of any specific plans
for the distribution of the Shares covered by this Prospectus. It is
anticipated, however, that the Shares may be offered by the Selling Stockholders
from time to time in one or more transactions on the Nasdaq National Market, in
privately negotiated transactions at such prices as may be agreed upon, or in a
combination of such methods of sale. The Selling Stockholders may effect such
transactions by selling the Shares to or through broker-dealers and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or the purchasers of the Shares for
whom such broker-dealers may act as agent or to whom they sell as principal or
both (which compensation to a particular broker-dealer might be in excess of
customary commissions). See "Plan of Distribution." The price at which any of
the Shares may be sold, and the commissions, if any, paid in connection with any
such sale, are unknown and may vary from transaction to transaction. The Company
will pay all expenses incident to the offering and sale of the Shares to the
public other than any commissions and discounts of underwriters, dealers or
agents and any transfer taxes. See "Plan of Distribution."
The Company's Common Stock is listed on the Nasdaq National Market under the
symbol "ACCS." On June 30, 1998 the last sale price of the Company's Common
Stock was $25.50 per share.
THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON PAGE
FOR INFORMATION THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
The Securities and Exchange Commission (the "Commission") may take the view
that, under certain circumstances, the Selling Stockholders and any
broker-dealers or agents that participate with the Selling Stockholders in the
distribution of the Shares may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"). Commissions,
discounts or concessions received by any such broker-dealer or agent may be
deemed to be underwriting commissions under the Securities Act. The Company and
the Selling Stockholders have agreed to certain indemnification arrangements.
See "Plan of Distribution."
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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.
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The date of this Prospectus is July 1, 1998
AVAILABLE INFORMATION
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 statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company may be inspected and
copied at the public reference facilities of the Commission located at 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
located at 7 World Trade Center, 13th Floor, New York, New York 10048, and at
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material can also be obtained at prescribed rates from the Public Reference
Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. The Commission maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission. The address of the
site is http://www.sec.gov. The Common Stock of the Company is listed on the
Nasdaq National Market. Reports and other information concerning the Company may
be inspected at the offices of Nasdaq Operations, 1735 K Street, NW, Washington,
D.C. 20006.
The Company has filed with the Commission a Post-Effective Amendment on Form
S-3 to a Registration Statement on Form S-4 (together with such post-effective
amendment, the "Registration Statement") under the Securities Act, with respect
to the Common Stock offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement and the exhibits and
schedules thereto, certain parts of which have been omitted in accordance with
the rules and regulations of the Commission. Statements contained in this
Prospectus as to the contents of any contract or other document referred to are
not necessarily complete, and in each instance, reference is made to the copy of
such contract or other document filed as an exhibit to the Registration
Statement of which this Prospectus forms a part, each such statement being
qualified in all respects by such reference. For further information with
respect to the Company and the Common Stock offered hereby, reference is made to
the Registration Statement and the exhibits and schedules thereto. Copies of the
Registration Statement and the exhibits and schedules thereto may be inspected,
without charge, at the offices of the Commission, or obtained at prescribed
rates from the Public Reference Section of the Commission at Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are incorporated herein by
reference:
1. The Company's Annual Report on Form 10-K/A for the fiscal year ended
September 30, 1997.
2. The Company's Quarterly Report on Form 10-Q/A for the fiscal quarter
ended December 31, 1997.
3. The Company's Quarterly Report on Form 10-Q/A for the fiscal quarter
ended March 31, 1998.
4. The description of the Company's Common Stock contained in the Company's
Registration Statement on Form 8-A filed with the Commission on December 24,
1991.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all securities registered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Prospectus and the Registration Statement of
which this Prospectus is a part and to be part hereof from the date of filing of
such documents.
In addition, pursuant to Rule 12b-23 under the Exchange Act, the information
included in the Company's Registration Statement on Form S-4 (Commission File
No. 333-56253), of which this Prospectus constitutes a part, is incorporated
herein by reference.
2
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this Prospectus to the extent that a statement contained
herein or in any other 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. The Company
will provide, without charge to each person to whom this Prospectus is
delivered, upon written or oral request of such person, a copy of any and all of
the information that has been or may be incorporated by reference in this
Prospectus, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Such requests
should be directed to the Investor Relations Department, Access Health, Inc.,
335 Interlocken Parkway, Broomfield, Colorado 80021, telephone (303) 466-9500.
THE COMPANY
Access Health is a leading provider of care management products and services
to the health care industry. Access Health provides its services primarily
through four telephonic care centers, which are staffed by registered nurses and
other health care professionals. Access Health's clients include health
maintenance organizations ("HMOs"), preferred provider organizations ("PPOs"),
indemnity insurers, integrated delivery systems, government agencies,
self-insured employers and physician groups. Access Health's objective is to
measurably improve the delivery of health care through integrated programs that
help individuals effectively manage their health needs. Its products and
services are designed to help reform an inefficient health care system in ways
that benefit health care payors, providers and individuals.
Access Health was founded in 1987 and until 1993 primarily provided consumer
health care information products and services designed to help hospitals and
other health care providers market their services. Beginning in 1993, Access
Health changed its focus to developing, marketing and delivering personal health
management products and services to health plans and payors, which were
primarily designed as a value added member benefit to help attract and retain
members. At the same time, Access Health altered its business model to price its
products and services predominantly on a recurring per-member per-month fee
basis rather than on a non-recurring basis. Access Health enjoyed significant
growth of its personal health management business through mid-1996, at which
point customer demand for care management products which provided demonstrable
cost savings began to intensify. At the time, health care service providers were
experiencing increased price competition and rising medical costs, resulting in
unprecedented high medical loss ratios and lower profitability. In November
1996, Access Health merged with Informed Access Systems, Inc. ("Informed
Access"), a developer of leading-edge clinical assessment tools and care
management programs. With this merger, Access Health significantly expanded its
suite of care management products. Also in November 1996, Access Health acquired
Clinical Reference Systems, Ltd. ("CRS"), which develops health information and
patient education software programs. Access Health's care management business
has grown dramatically; the number of enrolled members has increased to
approximately 25 million in February 1998 from over 14 million at the end of
fiscal 1996. On June 30, 1998, Access Health acquired InterQual, which develops
and markets clinical decision support information that assists health care
payors and providers in making and evaluating level of care and clinical
appropriateness decisions. See "Recent Developments."
Access Health was incorporated in California in October 1987 as Referral
Systems Group, Inc., adopted the name Access Health Marketing, Inc. in July
1990, reincorporated in Delaware in January 1992 and changed its name to Access
Health, Inc. in March 1995. Access Health maintains its principal executive
offices at 335 Interlocken Drive, Broomfield, Colorado 80021, and its telephone
number is (303) 466-9500.
3
RECENT DEVELOPMENTS
On June 30, 1998, the Company completed the acquisition of InterQual
pursuant to the terms of an Amended and Restated Agreement and Plan of
Reorganization dated as of June 4, 1998 (the "Merger Agreement"), entered into
by and among the Company, a newly-formed, wholly-owned subsidiary of the Company
("Merger Sub") and InterQual, pursuant to which Merger Sub merged with and into
InterQual, with InterQual being the surviving corporation and becoming a
wholly-owned subsidiary of the Company (the "Merger"). As a result of the
Merger, all of the outstanding Class A and Class B Common Stock of InterQual
converted into an aggregate of 4,540,000 shares of Company Common Stock. The
Merger and the related transactions are more fully described in the Company's
Registration Statement on Form S-4, of which this Prospectus constitutes a part,
filed with the Commission and which is incorporated herein by reference. See
"Incorporation of Certain Documents By Reference."
RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION INCLUDED OR INCORPORATED BY REFERENCE
IN THE PROSPECTUS, EACH PROSPECTIVE INVESTOR SHOULD CAREFULLY CONSIDER THE
FOLLOWING RISK FACTORS IN EVALUATING THE COMPANY AND ITS BUSINESS BEFORE
PURCHASING THE SECURITIES OFFERED HEREBY. THIS PROSPECTUS CONTAINS OR
INCORPORATES BY REFERENCE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF
SECTION 27A OF THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT THAT
INVOLVE CERTAIN RISKS AND UNCERTAINTIES. DISCUSSIONS CONTAINING SUCH
FORWARD-LOOKING STATEMENTS MAY BE FOUND IN THE MATERIAL UNDER "THE COMPANY" AS
WELL AS IN THIS PROSPECTUS GENERALLY, INCLUDING DOCUMENTS INCORPORATED BY
REFERENCE HEREIN. WITHOUT LIMITING THE FOREGOING, THE WORDS "BELIEVES,"
"ANTICIPATES," "PLANS," "EXPECTS," AND SIMILAR EXPRESSIONS ARE INTENDED TO
IDENTIFY FORWARD-LOOKING STATEMENTS. THE COMPANY'S ACTUAL RESULTS COULD DIFFER
MATERIALLY FROM THOSE ANTICIPATED IN SUCH FORWARD-LOOKING STATEMENTS AS A RESULT
OF CERTAIN FACTORS, INCLUDING THOSE SET FORTH IN THE FOLLOWING RISK FACTORS. THE
FORWARD-LOOKING STATEMENTS CONTAINED OR INCORPORATED BY REFERENCE HEREIN ARE
MADE AS OF THE DATE OF THIS PROSPECTUS AND THE COMPANY ASSUMES NO OBLIGATION TO
UPDATE SUCH FORWARD-LOOKING STATEMENTS OR TO UPDATE THE REASONS WHY ACTUAL
RESULTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN SUCH FORWARD-LOOKING
STATEMENTS.
UNCERTAINTIES RELATING TO INTEGRATION OF INTERQUAL OPERATIONS MAY AFFECT
OPERATING RESULTS. The Company and InterQual consummated the Merger with the
expectation that the Merger will result in beneficial synergies for the combined
companies. Achieving the anticipated benefits of the Merger will depend in part
upon whether the integration of the two companies' businesses is achieved in an
efficient, cost-effective and timely manner, and there can be no assurance that
this will occur. The successful combination of the two companies will require,
among other things, the timely integration of the companies' respective product
and service offerings and the coordination of their respective sales and
marketing and research and development efforts and the continuation of key
members of the InterQual management team. The difficulties of such integration
may be increased by the necessity of coordinating geographically separated
organizations. There can be no assurance that integration will be accomplished
smoothly, on time or successfully. Integrating the operations of the two
companies could have a material adverse effect on the Company's business. For
example, the process could (i) interrupt the Company's and InterQual's business,
(ii) divert management attention, (iii) place further pressure on the Company's
officers, and (iv) result in additional administrative and other expense.
Failure to effectively accomplish the integration of the two companies'
operations could have a material adverse effect on the Company's business,
results of operations and financial condition.
POTENTIAL DILUTIVE EFFECT TO STOCKHOLDERS. The issuance of Company Common
Stock in connection with the Merger is expected to have the effect of initially
reducing the Company's net income per share and could reduce the market price of
Company Common Stock. While the transaction is not expected to be accretive
until fiscal 1999, the degree of such accretion, if any, will depend on revenue
growth, cost savings and/or other business synergies sufficient to offset the
effect of such stock issuance. There can be no assurance that such synergies
will be achieved.
4
MATERIAL EXPENSES RESULTING FROM THE MERGER WILL IMPACT RESULTS OF
OPERATIONS. The Company's results of operations will be adversely affected by
Merger-related expenses, consisting primarily of nonrecurring transaction costs
of financial advisors, attorneys, accountants, financial printing and other
related charges estimated to be approximately $8 to $9 million. These costs will
be charged to operations in, and will therefore negatively impact operating
results for, the fiscal quarter ended June 30, 1998. Although the Company does
not believe that the costs will exceed these estimates, there is no assurance
that these estimates are correct or that unanticipated contingencies will not
occur that will substantially increase the costs of combining the operations of
the two companies or will result in a material adverse effect on the results of
operations and financial condition of the Company in future periods.
UNCERTAINTY RELATED TO OBTAINING, EXPANDING AND RETAINING CONTRACTS MAY
IMPACT RESULTS OF OPERATIONS. The Company's ability to increase revenues and
profitability is largely dependent on the Company's ability to secure additional
care management contracts and to retain and expand existing contracts. The
Company could be adversely affected by the termination or non-renewal of any of
the Company's contracts, or by renegotiation of the terms of contracts,
particularly if the affected contracts cover a large number of members or
represent a significant portion of the Company's care management revenue. For
example, in fiscal 1997, the Company renegotiated various older care management
contracts, typically upon renewal, to bring price terms based on minimum
membership and utilization rates previously negotiated in line with actual
membership and utilization rates. Such rationalizations resulted in a decrease
of revenue by approximately $7.0 million in fiscal 1997. During the first half
of fiscal 1998 contract rationalizations decreased revenue by approximately $2.7
million and for the balance of the year the Company expects contract
rationalizations to reduce revenue under such contracts by approximately $3.2
million. Any factors adversely affecting the market for the care management
product or the licensing and support services products, including factors
outside of the Company's control, such as adverse publicity or government
regulatory action, could have a material adverse effect on the Company.
DEPENDENCE ON PRINCIPAL CUSTOMERS. Significant portions of the Company's
revenues are generated by a limited number of customers. The Company's care
management contracts range from approximately 800 members to 3.0 million members
per contract. In fiscal 1997, the five largest single care management
enrollments totaled 3.0 million, 2.4 million, 1.9 million, 1.5 million and 1.5
million members. In fiscal 1997, the Company's three largest customers accounted
for approximately 8.0%, 7.8%, and 6.9% of the Company's total revenues and the
Company's top five customers, in the aggregate, accounted for approximately
33.4% of the Company's total revenues. After an initial term of approximately
one to four years, contracts generally can be terminated upon 60 to 360 days
notice to the Company. Three of the Company's five largest contracts are up for
renewal in the second half of fiscal year 1998. The Company's contracts could be
subject to early termination by its customers if the Company were not in
compliance with any applicable government regulation. The termination,
non-renewal or renegotiation of any such agreements could have a material
adverse effect on the Company's operating results.
UNCERTAINTY OF FUTURE OPERATING RESULTS. The Company's quarterly operating
results may fluctuate significantly in the future as a result of a variety of
factors, many of which are outside the Company's control. There can be no
assurance that the Company's revenues and profitability will increase during
fiscal 1998 and beyond. The Company's revenues may be materially adversely
affected by the termination or non-renewal of the Company's contracts or by the
renegotiation of the terms of such contracts. The Company may incur
significantly increased sales, marketing, and promotional expenses during fiscal
1998, and may devote additional resources to the further development of care
management, disease management or other new products. To the extent that the
Company incurs increased expenses, the Company's operating results will be
adversely affected unless revenues and operating margins increase sufficiently
to offset such expenditures.
HIGHLY COMPETITIVE MARKET. The market for the Company's products and
services is highly competitive. There are a number of competitors that offer
products or services that compete with some or all of
5
those offered by the Company. Existing and potential clients may also evaluate
the Company's products or services against internally developed programs.
Increased competition could result in pricing pressure and margin erosion. In
its existing business and as the Company offers new products or services, or
enters new markets, it may face increased competition from competitors, some of
which may have substantially greater financial, marketing and technical
resources than the Company. In particular, several small competitors have
recently been acquired or are expected to be acquired by companies with
substantially greater financial, marketing and technical resources than the
Company, and this could lead to increased competition. There can be no assurance
that the Company will continue to compete successfully.
CHANGING HEALTH CARE MARKET COULD CAUSE NEW PRODUCT DEVELOPMENT AND OTHER
COSTS TO INCREASE; ABILITY TO ADAPT TO CHANGE. The health care industry has
undergone significant changes in recent years, and changes are expected to
continue. Containing health care costs has become a national priority. As a
result, the health care industry has become increasingly dominated by managed
health care plans, causing cost containment pressure to rise. To address these
changes, the Company shifted its business focus in 1993 to payors from providers
and developed its personal health management services. There is no assurance
that the Company's existing products and services will achieve continued success
or that its new products and services will succeed. There also can be no
assurance that continued industry change will not adversely affect the Company's
ability to compete. Continued change may cause the Company to incur significant
product development and marketing expenses, which could have a material effect
on operations. The Company's future success will depend on the Company's ability
to adapt to the changing needs of the health care industry.
DEPENDENCE ON ADEQUATE FUNCTIONING OF CARE CENTER OPERATIONS. The Company
maintains member service and data centers ("care centers") in Rancho Cordova,
California; Chicago, Illinois; Broomfield, Colorado; and Phoenix, Arizona. The
Company's operations depend on the adequate functioning of the computer and
telephone systems in its call centers. Although the Company has taken
precautions to provide for power, computer, and telephone systems redundancy,
there can be no assurance that a fire or other disaster affecting the centers or
an equipment failure would not disable the Company's systems for a significant
period of time. Any significant damage to the Company's facilities or an
equipment failure could have a material adverse effect on the Company's results
of operations.
The successful operation of the Company's care centers is based on a
networked information system. The information system provides care center nurses
and health care counselors with access to care management applications and a
database of information including member information, plan rules, physician
information and clinical algorithms and guidelines. The Company is in the
process of developing a new information system which combines certain aspects of
the different systems developed by Access Health and Informed Access. Failure to
successfully develop and implement this new information system could delay
revenues or increase operating costs and could have a material adverse effect on
the Company. The ability to continue to develop, implement and support the
Company's information systems is dependent on its ability to employ and retain
experienced technical personnel. If the Company is unable to hire and retain
required personnel or is required to pay compensation at significantly higher
levels to attract and retain technical personnel it could have a material
adverse effect on the Company's financial results.
LIMITATIONS ON PROTECTION OF PROPRIETARY RIGHTS. The Company regards its
software, clinical algorithms and nursing assessment tools, clinical operational
expertise and marketing and program operation materials as proprietary and takes
action to protect its intellectual property with patents, copyrights,
trademarks, trade secret laws and restrictions on disclosure, copying and
transferring title. Despite the Company's precautions, it may be possible for
unauthorized third parties to copy aspects of the Company's products or to
obtain and use information that the Company regards as proprietary. There can be
no assurance that competitors, some of which have substantial resources and have
made substantial investments in competing technologies, will not seek to apply
for and obtain patents that will prevent, limit or interfere with the
6
Company's ability to market its products and services either in the United
States or in international markets. The Company could incur substantial costs
defending itself in suits against the Company or its proprietary rights or in
bringing suits against those parties to enforce the Company's proprietary
rights. The Company has been issued patents on its clinical algorithms in the
United States and has filed for patent protection in some foreign countries.
There is no assurance that such patents will not be challenged or invalidated.
Existing copyright laws afford only limited practical protection. In addition,
the laws of some foreign countries do not protect the Company's proprietary
rights to the same extent as do the laws of the United States, which could be a
factor depending upon into which countries outside the United States the Company
expands.
NEED TO CONTINUE TO MANAGE GROWTH OF OPERATIONS. The Company has
experienced rapid growth in recent years. Continued rapid growth may place a
significant strain on the Company's management, telecommunications systems,
operational infrastructure, working capital and financial and management control
systems. The difficulties of managing growth may be increased by the necessity
of coordinating geographically separated organizations. In order for the Company
to manage its client base successfully, management will be required to
anticipate the changing demands of their growing operations and to adopt systems
and procedures accordingly. Failure to effectively implement or maintain such
systems and procedures could adversely affect the Company's business, results of
operation and financial condition. Further, there can be no assurance that the
Company's current information systems, telecommunications systems and
operational infrastructure will be adequate for its future needs, or that the
Company will be successful in implementing new systems. Failure to upgrade its
information systems, telecommunications systems and operational infrastructure
or unexpected difficulties encountered with these systems during expansion could
adversely affect the Company's business, financial condition and results of
operations.
ACQUISITION-RELATED RISKS MAY ADVERSELY AFFECT OPERATIONS AND FINANCIAL
RESULTS. The Company has grown in part through mergers and acquisitions. The
Company has acquired InterQual and intends to evaluate acquisitions of other
product lines and businesses as part of its business strategy. The process of
integrating an acquired company's business into the Company's operations may
result in unforeseen operating difficulties and expenditures and may absorb
significant management attention that would otherwise be available for the
ongoing development of the Company's business. Moreover, there can be no
assurance that the anticipated benefits of an acquisition will be realized.
Future acquisitions by the Company could result in potentially dilutive issuance
of equity securities, the incurrence of debt and contingent liabilities and
amortization expenses related to goodwill and other intangible assets, which
could materially adversely affect the Company's operating results and financial
condition. In addition, acquisitions involve numerous risks, including
difficulties in managing diverse geographic operations, the diversion of
management's attention from other business concerns, risks of entering markets
in which the Company has no or limited direct prior experience, the addition of
unanticipated administrative and other expense, and the potential loss of key
employees of the acquired company. The inability of the Company's management to
respond to changing business conditions effectively, including the changes
associated with its acquired businesses and product lines, could have a material
adverse effect on the Company's results of operations.
DEPENDENCE ON KEY EMPLOYEES AND MANAGEMENT OF CHANGE. The Company's success
depends on a limited number of key management employees, most of whom are
subject to post-employment non-competition restrictions. The loss of the
services of one or more of these employees could have a material adverse effect
on the Company. The Company believes that its continued success also will depend
in large part on its ability to attract and retain highly skilled management,
nursing, technical, marketing, and sales personnel. Competition for such
personnel is intense, and there can be no assurance that the Company will be
successful in attracting and retaining such personnel as necessary. Furthermore,
the Company's ability to manage change and growth successfully will require the
Company to continue to improve its management expertise as well as its financial
systems and controls.
7
VOLATILITY OF STOCK PRICE. The market for the Company's stock is highly
volatile. The trading price of the Company's common stock is subject to wide
fluctuations in response to a variety of factors including the signing or loss
of a major contract, changes in market analyst estimates and recommendations for
the Company's common stock, fluctuations in operating results, the failure of
operating results to meet market analyst's estimates, changes in government
regulation and general conditions in the health care industry and the economy,
any of which could cause the price of the Company's common stock to fluctuate,
perhaps substantially. In addition, in recent years stock prices have
experienced significant fluctuations, which have particularly affected the
market price for the securities of health care companies and which often have
been unrelated to the operating performance of these companies.
GOVERNMENT REGULATION. The health care industry is subject to extensive and
evolving government regulation at both the Federal and state levels relating to
many aspects of the Company's and its clients' businesses in use of the
Company's programs, including the provision of health care services,
teleservicing, and health care referral programs. These statutes and regulations
in many cases predate the development of telephone-based health care information
and other interstate transmission and communication of medical information and
services. The literal language of certain of these statutes and regulations
governing the provision of health care services, including the practice of
nursing and the practice of medicine, could be construed by regulatory
authorities to apply to certain of the Company's activities, including without
limitation teleservicing activities which use California, Illinois, Arizona, and
Colorado registered nurses to provide out-of-state care management services such
as nursing assessments and information regarding appropriate sources of care and
treatment time frames. These statutes and regulations could also apply to
certain activities of the Company's health service customers when operating the
Company's programs. The Company understands that state regulators in some states
have informed some entities that they are adopting such a construction. The
Company has taken steps to comply with such regulatory interpretation, but there
can be no assurance that such steps will be sufficient to protect the Company
from the effects of any such regulatory action. In addition, the literal
language of the statutes and regulations governing health maintenance
organizations and other plans that provide or arrange for the provision of
health care services for a prepaid or periodic charge could be construed by
regulatory authorities to apply to certain activities of the Company that are
provided on a per-member, per-month basis. The Company has not been made, nor is
it aware that any other company providing out-of-state teleservicing has ever
been made, the subject of such requirements by a regulatory authority. However,
if regulators seek to enforce any of the foregoing statutory and regulatory
requirements, the Company, its employees and/or its clients could be required to
obtain additional licenses or registrations, to modify or curtail the operation
of the Company's programs, to modify the method of payment for the Company's
programs, or to pay fines or incur other penalties.
The payment of remuneration to induce the referral of health care business
has been a subject of increasing governmental and regulatory focus in recent
years. Section 1128B(b) of the Social Security Act (sometimes referred to as the
"Federal anti-kickback statute") provides criminal penalties for individuals or
entities that knowingly and willfully offer, pay, solicit or receive
remuneration in order to induce referrals for items or services for which
payment may be made under the Medicare and Medicaid programs and certain other
government-funded programs. The Social Security Act provides authority to the
Office of the Inspector General through civil proceedings to exclude an
individual or entity from participation in the Medicare and state health
programs if it is determined any such party has violated Section 1128B(b) of the
Social Security Act. Regulations have been promulgated specifying certain
payment practices, which will not be subject to criminal prosecution or civil
exclusion. These regulations, commonly referred to as the "safe harbor"
regulations, do not expand the scope of the Federal anti-kickback statute, and
the fact that a business arrangement does not fit within a safe harbor does not
mean the business arrangement violates the Federal anti-kickback statute. The
Company's programs do not meet the requirements of the safe harbor for referral
services. A number of states in which the Company operates have anti-kickback
statutes similar to the Federal statute as well as statutory and regulatory
requirements governing referral
8
agencies and regulating franchising and business opportunity ventures. In
addition, the Federal government and a number of states have enacted statutes
which contain outright prohibitions on referrals for specified services which
are made by referring providers who have an ownership interest in, or
compensation arrangement with, the entity to which the referral is made. If the
Company or the use of its products and services were to be found in violation of
such statutes, the Company or its clients could be required to modify or curtail
the operation of the Company's programs, or to pay fines or incur other
penalties, and the Company's clients could be excluded from participation in the
Medicare and Medicaid programs and could be precluded from charging fees and
obtaining reimbursement for specified services.
There can be no assurance that the Company or the use of its products and
services will not be subject to review or challenge by government regulators
under any of the foregoing statutes and regulations that apply to health care
services and products. In addition, additional laws and regulations could be
enacted in the future that would regulate the Company or the use of its products
and services. Any government investigative or enforcement actions with respect
to the Company or the use of its products or services could generate adverse
publicity irrespective of the final outcome, and could have a material adverse
effect on the Company.
RISK MANAGEMENT. In recent years, participants in the health care industry,
including physicians, nurses and other health care professionals, have been
subject to an increasing number of lawsuits alleging malpractice, product
liability and related legal theories, many of which involve large claims and
significant defense costs. Due to the nature of its business, the Company could
become involved in litigation regarding the telephone information given by its
registered nurses or those of its licensees with the risk of adverse publicity,
significant defense costs and substantial damage awards. The Company has
established policies and procedures that limit the information provided by its
registered nurses to that contained in its clinical algorithms and protocols and
in other approved reference sources. In connection with its teleservices
operations, the Company has a quality assurance program that includes real-time
audits of calls and post call reviews to monitor compliance with established
policies and procedures. Generally, clients review and approve the Company's
clinical algorithms, protocols and guidelines prior to program implementation
and do not modify them without medical approval. To date, the Company has not
been the subject of any claim involving either its clinical assessment systems,
the operation of its teleservicing centers or the operation by hospital or other
clients of on-site call centers. However, there can be no assurance that claims
will not be brought against the Company. Even if such claims ultimately prove to
be without merit, defending against them can be time consuming and expensive,
and any adverse publicity associated with such claims could have a material
adverse effect on the Company. Further, there can be no assurance that the
Company has appropriate or sufficient coverage under the existing insurance
plans or that they will be able to obtain appropriate or sufficient amounts of
insurance in the future to address the foregoing risks on terms that are
commercially reasonable.
IMPACT OF THE YEAR 2000 ON COMPUTER SYSTEMS. The architectural design on
the Company's computer systems and infrastructure have taken into account the
effect of integrating existing date data with date data from the Year 2000 and
beyond. As a result, the Company believes it will address and resolve any
possible issue associated with the integration of Year 2000 date data in a
timely fashion and will not materially affect future financial results or cause
reported financial information to be inaccurate. Nevertheless, unforeseen
internal problems or unanticipated events including the inability of third party
vendors to integrate Year 2000 date data could occur causing a material adverse
effect on the Company's business, results of operations and financial condition.
9
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares. All proceeds from the sale of the Shares will be for the account of the
Selling Stockholders, as described below. See "Selling Stockholders" and "Plan
of Distribution" described below.
SELLING STOCKHOLDERS
The following table sets forth as of the date of this Prospectus, the name
of each of the Selling Stockholders, the number of shares of Common Stock that
each such Selling Stockholder beneficially owns as of June 30, 1998, the number
of shares of Common Stock beneficially owned by each Selling Stockholder that
may be offered for sale from time to time by this Prospectus, and the number of
shares of Common Stock to be held by each such Selling Stockholder assuming the
sale of all the Common Stock offered hereby.
The Company has agreed to initially register up to 1,000,000 Shares for
resale by the Selling Stockholders. The Shares being offered by the Selling
Stockholders were acquired from the Company in connection with the issuance of
shares as consideration for the acquisition of InterQual, Inc. on June 30, 1998.
See "Recent Developments." Except as otherwise indicated, the persons named in
the table have sole voting and investment power with respect to all of the
shares of Common Stock shown as beneficially owned by them, subject to community
property laws, where applicable.
SHARES OF COMMON STOCK
SHARES BENEFICIALLY OWNED
BENEFICIALLY SHARES AFTER OFFERING(1)
OWNED PRIOR TO BEING -----------------------
SELLING STOCKHOLDER OFFERING(1) OFFERED NUMBER PERCENT
- ------------------------------------------------------------- ----------------- --------- ---------- -----------
Charles Jacobs(2)............................................ 1,816,124 499,761 1,316,363 5.59%
Susan Weagly Jacobs(3)....................................... 762,390 210,257 552,133 2.34
Josephine A. Lamprey(4)...................................... 868,848 234,820 634,028 2.69
Randolph W. Seed, M.D.(5).................................... 217,411 55,162 162,249 0.69
- ------------------------
(1) Beneficial ownership is determined in accordance with the rules of
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of Common Stock subject to options or warrants held by that person
that are currently exercisable or exercisable within 60 days of the date of
this Prospectus are deemed outstanding. Such shares, however, are not deemed
outstanding for the purposes of computing the percentage ownership of each
other person. Except as indicated in the footnotes to this table and
pursuant to applicable community property laws, each stockholder named in
the table above has sole voting and investment power with respect to the
shares set forth opposite such stockholder's name. Percentage beneficial
ownership is based on 19,010,997 shares of Common Stock outstanding as of
June 29, 1998 and such shares of Common Stock issued in connection with the
Merger in exchange for all of the outstanding Class A and Class B Common
Stock of InterQual.
(2) Includes 4,000 shares of Common Stock owned by Randolph W. Seed which,
pursuant to a Pledge Agreement, effective on January 1, 1997, between
Randolph Seed, M.D. and Charles M. Jacobs (the "Pledge Agreement"), and the
amendments thereto, was pledged to Mr. Jacobs, together with the stock's
voting and other rights, until such time as Mr. Jacobs' loan to Dr. Seed is
repaid in full. Mr. Jacobs was a founder of InterQual and served as a
director and as Chief Executive Officer from its inception until the
effective date of the Merger.
(3) Ms. Jacobs was a founder of InterQual and served as a Senior Vice President
of InterQual until the effective date of the Merger. Ms. Jacobs is currently
an employee of the Company.
10
(4) Includes 17,393 shares of Common Stock owned by a trust as to which Ms.
Lamprey shares voting power. Ms. Lamprey served as President of InterQual
until the effective date of the Merger. She is currently an employee of the
Company.
(5) Represents shares pledged pursuant to the Pledge Agreement and 17,393 shares
of Common Stock owned by a trust as to which Mr. Seed shares voting power.
Mr. Seed served as a director of InterQual until the effective date of the
Merger.
PLAN OF DISTRIBUTION
Access Health will not receive any of the proceeds from the sale by the
Selling Stockholders of the shares of Access Health Common Stock offered hereby.
Any or all of the shares of Access Health Common Stock may be sold from time to
time (i) to or through underwriters or dealers, (ii) directly to one or more
other purchasers, (iii) through agents on a best-efforts basis, or (iv) through
a combination of any such methods of sale.
The shares of Access Health Common Stock offered hereby may be sold from
time to time by the Selling Stockholders, or by pledgees, donees, transferees or
other successors in interest. The shares offered by the Selling Stockholders may
be sold from time to time on one or more exchanges or in the over-the-counter
market, or otherwise at market prices prevailing at the time of sale, at prices
relating to such prevailing market prices or at negotiated prices. In addition,
the Selling Stockholders may sell their shares covered by this Prospectus
through customary brokerage channels, either through broker-dealers acting as
agents or brokers, or through broker-dealers acting as principals, who may then
resell the shares, or at private sale or otherwise, at market prices prevailing
at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. The Selling Stockholders may effect such
transactions by selling shares to or through broker-dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions, commissions, or fees from the Selling Stockholders and/or
purchasers of the shares for whom such broker-dealers may act as agent or to
whom they may sell as principal, or both (which compensation to a particular
broker-dealer might be in excess of customary commissions). Without limiting the
generality of the foregoing, the shares may be sold by one or more of the
following: (a) 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; (b) purchases by a broker or
dealer as principal and resale by such broker or dealer for its account pursuant
to this Prospectus; (c) an exchange distribution in accordance with the rules of
such exchange; and (d) ordinary brokerage transactions and transactions in which
the broker solicits purchasers. In effecting sales, brokers or dealers engaged
by the Selling Stockholders may arrange for other brokers or dealers to
participate. Brokers or dealers will receive commissions or discounts from
Selling Stockholders in amounts to be negotiated prior to the sale. In addition,
any securities covered by this Prospectus which qualify for sale pursuant to
Rules 144 or 145 may be sold under such rules rather than pursuant to this
Prospectus.
The Selling Stockholders and any such underwriters, dealers or agents that
participate in the distribution of the Access Health Common Stock may be deemed
to be underwriters within the meaning of the Securities Act, and any profit on
the sale of the Access Health Common Stock by them and any discounts,
commissions or concessions received by them may be deemed to be underwriting
discounts and commissions under the Securities Act. The Access Health Common
Stock may be sold from time to time in one or more transactions at a fixed
offering price, which may be changed, or at varying prices determined at the
time of sale or at negotiated prices. Such prices will be determined by the
Selling Stockholders or by an agreement between the Selling Stockholders and
underwriters or dealers. Brokers or dealers acting in connection with the sale
of Access Health Common Stock contemplated by this Prospectus may receive fees
or commissions in connection therewith.
At the time a particular offer of Access Health Common Stock is made, to the
extent required, a supplement to this Prospectus will be distributed which will
identify and set forth the aggregate number of
11
shares of Access Health Common Stock being offered and the terms of the
offering, including the name or names of any underwriters, dealers or agents,
the purchase price paid by any underwriter for Access Health Common Stock
purchased from the Selling Stockholders, any discounts, commissions and other
items constituting compensation from the Selling Stockholders and/or Access
Health and any discounts, commissions or concessions allowed or reallowed or
paid to dealers, including the proposed selling price to the public. Such
supplement to this Prospectus and, if necessary, a post-effective amendment to
the Registration Statement of which this Prospectus is a part, will be filed
with the Commission to reflect the disclosure of additional information with
respect to the distribution of the Access Health Common Stock.
Under applicable rules and regulations under the Exchange Act, in connection
with any distribution of the Access Health Common Stock, the Selling
Stockholders may not, directly or indirectly, bid for, purchase or attempt to
induce any other person to bid for or purchase the Access Health Common Stock
during a period beginning one day prior to the determination of the offering
price in connection with such distribution and ending when the distribution is
completed.
In order to comply with certain states' securities laws, if applicable, the
Access Health Common Stock will be sold in such jurisdictions only through
registered or licensed brokers or dealers.
Access Health has agreed to indemnify the Selling Stockholders and certain
other persons against certain liabilities, including liabilities arising under
the Securities Act.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby is being passed
upon for the Company by Wilson Sonsini Goodrich & Rosati, Professional
Corporation, Palo Alto, California.
EXPERTS
The consolidated financial statements of Access Health appearing in Access
Health's Annual Report (Form 10-K/A) for the year ended September 30, 1997 and
appearing in the Registration Statement (Form S-4 No. 333-56253) of Access
Health have been audited by Ernst & Young LLP, independent auditors, as set
forth in their reports thereon included therein and incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such reports given upon the authority of such firm as
experts in accounting and auditing.
The consolidated financial statements of Informed Access Systems, Inc. as of
December 31, 1995 and for the year then ended have been audited by Arthur
Andersen LLP, independent public accountants, as set forth in their report which
is included in the Company's Annual Report on Form 10-K/A which is incorporated
by reference herein, and which is referred to in the report of Ernst & Young
LLP, in reliance upon the authority of said firm as experts in giving said
report.
The consolidated financial statements of InterQual as of December 31, 1996
and 1997, and for each of the three years ended December 31, 1995, 1996 and 1997
included in this Proxy Statement/Prospectus and Notice and Consent Solicitation
Statement have been so included in reliance on the report of Alexander, Aronson,
Finning & Co., P.C., independent auditors, given on the authority of such firm
as experts in auditing and accounting.
12
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
NO DEALER, SALESPERSON OR ANY OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING COVERED BY THIS
PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY SELLING STOCKHOLDER.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO BUY THE COMMON STOCK IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO
WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE AN IMPLICATION THAT THERE HAS NOT BEEN ANY CHANGE IN THE FACTS SET FORTH
IN THIS PROSPECTUS OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
-------------------
TABLE OF CONTENTS
PAGE
-----
Available Information.......................... 2
Incorporation of Certain Documents By
Reference..................................... 2
The Company.................................... 3
Recent Developments............................ 4
Risk Factors................................... 4
Use of Proceeds................................ 10
Selling Stockholders........................... 10
Plan of Distribution........................... 11
Legal Matters.................................. 12
Experts........................................ 12
1,000,000 SHARES
[LOGO]
COMMON STOCK
---------------------
P R O S P E C T U S
---------------------
JULY 1, 1998
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses to be paid by the Registrant in connection with this
offering are as follows:
Securities and Exchange Commission Registration Fee................ $ --
Accounting fees and expenses....................................... 10,000
Printing expenses.................................................. 10,000
Miscellaneous...................................................... 10,000
---------
Total............................................................ $ 30,000
---------
---------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Registrant's Certificate of Incorporation and Bylaws include provisions
to (i) eliminate the personal liability of the Registrant's directors for
monetary damages resulting from breaches of their fiduciary duty to the extent
permitted by Section 102(b)(7) of the Delaware General Corporation Law (the
"DGCL") and (ii) require the Registrant to indemnify its directors and officers
to the fullest extent permitted by Section 145 of the DGCL, including
circumstances in which indemnification is otherwise discretionary. Pursuant to
Section 145 of the DGCL, a corporation generally has the power to indemnify its
present and former directors, officers, employees and agents against expenses
incurred by them in connection with any suit to which they are, or are
threatened to be made, a party by reason of their serving in such positions so
long as they acted in good faith and in a manner they reasonably believed to be
in, or not opposed to, the best interests of the corporation, and with respect
to any criminal action, they had no reasonable cause to believe their conduct
was unlawful. The Registrant believes that these provisions are necessary to
attract and retain qualified persons as directors and officers. These provisions
do not eliminate liability for breach of the director's duty of loyalty to the
Registrant and its stockholders, for acts or omissions not in good faith or
involving intentional misconduct or knowing violations of law, for any
transaction from which the director derived an improper personal benefit, or for
any willful or negligent payment of any unlawful dividend or any unlawful stock
purchase agreement or redemption.
The Registrant has entered into agreements with its directors and executive
officers that require the Registrant to indemnify such persons against expenses,
judgments, fines, settlements and other amounts incurred (including expenses of
a derivative action) in connection with any proceeding, whether actual or
threatened, to which any such person may be made a party by reason of the fact
that such person is or was a director or an executive officer of the Registrant
or any of its affiliated enterprises, provided such person acted in good faith
and in a manner such person reasonably 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 this conduct was unlawful. The
indemnification agreements also set forth certain procedures that will apply in
the event of a claim for indemnification thereunder.
The Merger Agreement provides that commencing with the effectiveness of the
Merger, Access Health shall or shall cause InterQual to provide indemnification,
to the same extent and under similar conditions and procedures as offered to
officers and director of Access Health, to each current officer or director of
InterQual (or any person who shall become an officer or director between the
date of the Merger Agreement and prior to the Effective Time) and each person
who served at the request of InterQual as an officer or director of another
entity. The indemnity obligations of Access Health will survive the consummation
of the Merger for a period of six years and any additional time period beyond
six years as necessary to resolve a claim for indemnification made during the
initial six year period. In the event Access Health merges with another entity
or transfers all or a substantial portion of its properties or
II-1
assets to any other person or entity, such successor or assignee must assume
such indemnification obligations of Access Health.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
EXHIBIT DESCRIPTION
- -------------- ----------------------------------------------------------------------------------------------------
2.1 (I) Agreement and Plan of Reorganization by and among the Registrant, Access Acquisition Corp. and
Informed Access Systems, Inc. dated as of September 3, 1996
2.2 (K) Agreement and Plan of Reorganization by and among the Registrant, CRS and Access Colorado, Inc.
dated as of September 5, 1996
2.3 (R) Amended and Restated Agreement and Plan of Reorganization by and among the Registrant, Access
Acquisition Corp. 98A and InterQual, Inc. dated June 4, 1998 (filed herewith as Annex A)
3.1 (K) Amended and Restated Certificate of Incorporation
3.2 (K) Amended and Restated Bylaws
3.3 (O) Certificate of Designation of Rights, Preferences and Privileges of Series A Participating Preferred
Stock of Access Health, Inc., filed on March 13, 1997
4.1 (K) Specimen Stock Certificate
4.2 (K) Shareholder's Representation Statement and Registration Rights Agreement dated as of November 25,
1996 between Registrant and various investors
4.3 (K) Registration Rights Agreement dated November 18, 1996
4.4 (O) Form of Preferred Shares Rights Agreement, dated as of March 12, 1997 between the Company and the
First National Bank of Boston, including exhibits
5.1 Opinion of Wilson Sonsini Goodrich & Rosati (regarding legality of securities being registered)
10.1 (L) Registrant's 1989 Incentive Stock Plan (as amended)
10.2 (G) Registrant's 1991 Employee Stock Purchase Plan (as amended)
10.3 (A) Lease dated April 10, 1991 for Registrant's office equipment at 11020 White Rock Road, Rancho
Cordova, California and 104 Wilmot Road, Deerfield, Illinois
10.4 (B) Lease dated June 15, 1992 for Registrant's facilities at 11020 White Rock Road, Rancho Cordova,
California
10.5 (B) Form of Note and Security Agreement for Registrant's office equipment at 11020 White Rock Road,
Rancho Cordova, California
10.6 (B) Lease dated February 19, 1992 for Registrant's office equipment at 11020 White Rock Road, Rancho
Cordova, California and 104 Wilmot Road, Deerfield, Illinois
10.7 (A) Sale and Installation Agreement dated November 16, 1990 between Registrant and Aspect
Telecommunications Corporation
10.8 (B) Lease dated May 5, 1992 for Registrant's office equipment at 11020 White Rock Road, Rancho Cordova,
California and 104 Wilmot Road, Deerfield, Illinois
10.9 (K) Form of Director and Officer Indemnification Agreement
II-2
EXHIBIT DESCRIPTION
- -------------- ----------------------------------------------------------------------------------------------------
10.10(C) Equipment Financing Agreement for Registrant's office and computer equipment at 11020 White Rock
Road, Rancho Cordova, California and 3060 Salt Creek Lane, Arlington Heights, Illinois
10.11(E) First Amendment to Lease dated August 6, 1993 for Registrant's facility at 11020 White Rock Road,
Rancho Cordova, California
10.12(E) Lease dated August 13, 1993 for Registrant's facility at 3060 Salt Creek Lane, Arlington Heights,
Illinois
10.13(E) Lease dated November 1, 1993 for Registrant's facility at 2510 W. Dunlap Drive, Phoenix, Arizona
10.14(D) Instruments Defining the Rights of Security Holders--Warrants for the Purchase of Common Stock
10.15(D) Instruments Defining the Rights of Security Holders--Registration Rights
10.16(D) Common Stock Purchase Option Agreement
10.17(G) Registrant's 1995 Director Option Plan
10.18(J) Registrant's 1996 Supplemental Stock Plan
10.19(F) Employment Agreement with Jeremy J. Nobel, M.D.
10.20(H)+ Amended and Restated Agreement of Limited Partnership of AHN
10.21(H)+ Admission Agreement dated April 15, 1996
10.22(H)+ Partnership Interest Option Agreement dated April 15, 1996
10.23(H) Line of Credit Note dated May 7, 1996
10.24(K) Employment Agreement with Thomas E. Gardner dated December 1, 1996
10.25(L) Employment Agreement with Joseph P. Tallman dated November 18, 1996
10.26(M) AHN Partners, L.P., 8% Convertible Subordinated Debenture due 2001
10.27(M) Form of Change of Control/Severance Agreement for all named Executive Officers
10.28(N) Amendment to Employment Agreement dated April 30, 1997 between Registrant and Kenneth B. Plumlee
10.29(N) Amendment to Stock Option Agreement dated April 30, 1997 between Registrant and Kenneth B. Plumlee
10.30(N) Separation Agreement and Mutual Release dated April 30, 1997 between Registrant and Thomas E.
Gardner
10.31(P) Employment Agreement dated December 1, 1996 between Registrant and Kenneth B. Plumlee
10.32(P) Severance Agreement dated July 1, 1997 between Registrant and Kipp Johnson
10.33(P) Consulting Agreement dated July 1, 1997 between Registrant and John V. Crisan
10.34(P) Employment Agreement dated November 18, 1996 between Registrant Timothy H. Connor
10.35(P) Lease Agreement dated March 3, 1997 for Registrant's facility at 329 and 335 Interlocken Parkway,
Broomfield, Colorado
II-3
EXHIBIT DESCRIPTION
- -------------- ----------------------------------------------------------------------------------------------------
10.36(P) Second Amended and Restated Agreement of Limited Partnership of AHN Partners, L.P., dated November
1, 1997
10.37(Q) Registrant's 1998 Stock Option Plan
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Arthur Andersen LLP, Independent Public Accountants
23.3 Consent from Alexander, Aronson, Finning & Co., P.C.
23.4 Consent of Wilson Sonsini Goodrich & Rosati, PC (Included with Exhibit 5.1)
24.1 (R) Power of Attorney
- ------------------------
(A) Incorporated by reference to Registrant's Form S-1 Registration Statement
No. 33-44604.
(B) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1992.
(C) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
March 31, 1993.
(D) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1993.
(E) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1993.
(F) Incorporated by reference to Registrant's Form 10-K/A for the year ended
September 30, 1995.
(G) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
December 31, 1995.
(H) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1996.
(I) Incorporated by reference to Registrant's Registration Statement on Form S-4
(No. 333-13931).
(J) Incorporated by reference to Registrant's Registration Statement on Form S-8
(No. 333-18163).
(K) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1996.
(L) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
December 31, 1996.
(M) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
March 31, 1997.
(N) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1997.
(O) Incorporated by reference to Registrant's Registration Statement on Form 8-A
filed on March 13, 1997 (No. 000-19758).
(P) Incorporated by reference to Registrant's Form 10-K/A for the year ended
September 30, 1997.
(Q) Incorporated by reference to Registrant's Form 10-Q/A for the quarter ended
March 31, 1998.
(R) Incorporated by reference to Registrant's Form S-4 Registration Statement
No. 333-56253.
+ Confidential treatment granted for portions of document.
ITEM 22. UNDERTAKINGS
(1) The undersigned registrant hereby undertakes:
(a) 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;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range
II-4
may be reflected in the form of prospectus filed with the SEC pursuant to
Rule 424(b) (Section230.424(b) of this chapter) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
(b) 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 the
initial bona fide offering thereof.
(c) 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.
(2) 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
Section 15(d) of the Exchange Act that is incorporated by reference in this
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) 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 provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the 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.
II-5
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 this Post-Effective Amendment on Form S-3 and has duly
caused this Post-Effective Amendment on Form S-3 to Registration Statement on
Form S-4 to be signed on its behalf by the undersigned, thereunto duly
authorized, in Broomfield, State of Colorado, on the 30th day of June, 1998.
ACCESS HEALTH, INC.
By: /s/ TIMOTHY H. CONNOR
-----------------------------------------
Timothy H. Connor
SENIOR VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
(PRINCIPAL FINANCIAL OFFICER)
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment on Form S-3 to Registration Statement on Form S-4 has
been signed by the following persons in the capacities and on the dates
indicated.
NAME TITLE DATE
- ------------------------------ -------------------------- -------------------
President and Chief
* Executive Officer and
- ------------------------------ Director (Principal June 30, 1998
Joseph P. Tallman executive officer)
Senior Vice President and
/s/ TIMOTHY H. CONNOR Chief Financial Officer
- ------------------------------ (Principal financial June 30, 1998
Timothy H. Connor officer)
*
- ------------------------------ Executive Vice President June 30, 1998
Richard C. Miller and Director
*
- ------------------------------ Director June 30, 1998
John R. Durant, M.D.
/s/ DOUGLAS L. ELDEN
- ------------------------------ Director June 30, 1998
Douglas L. Elden
*
- ------------------------------ Director June 30, 1998
Kinney L. Johnson
*
- ------------------------------ Director June 30, 1998
Frank G. Washington
* By: /s/ TIMOTHY H.
CONNOR
- ------------------------------
Timothy H. Connor,
Attorney-in-Fact
II-6
EXHIBIT INDEX
SEQUENTIALLY
EXHIBIT DESCRIPTION NUMBERED PAGE
- -------------- -------------------------------------------------------------------------------------- -----------------
2.1 (I) Agreement and Plan of Reorganization by and among the Registrant, Access Acquisition
Corp. and Informed Access Systems, Inc. dated as of September 3, 1996...............
2.2 (K) Agreement and Plan of Reorganization by and among the Registrant, CRS and Access
Colorado, Inc. dated as of September 5, 1996........................................
2.3 (R) Amended and Restated Agreement and Plan of Reorganization by and among the Registrant,
Access Acquisition Corp. 98A and InterQual, Inc. dated June 4, 1998 (filed herewith
as Annex A).........................................................................
3.1 (K) Amended and Restated Certificate of Incorporation.....................................
3.2 (K) Amended and Restated Bylaws...........................................................
3.3 (O) Certificate of Designation of Rights, Preferences and Privileges of Series A
Participating Preferred Stock of Access Health, Inc., filed on March 13, 1997.......
4.1 (K) Specimen Stock Certificate............................................................
4.2 (K) Shareholder's Representation Statement and Registration Rights Agreement dated as of
November 25, 1996 between Registrant and various investors..........................
4.3 (K) Registration Rights Agreement dated November 18, 1996.................................
4.4 (O) Form of Preferred Shares Rights Agreement, dated as of March 12, 1997 between the
Company and the First National Bank of Boston, including exhibits...................
5.1 Opinion of Wilson Sonsini Goodrich & Rosati (regarding legality of securities being
registered).........................................................................
10.1 (L) Registrant's 1989 Incentive Stock Plan (as amended)...................................
10.2 (G) Registrant's 1991 Employee Stock Purchase Plan (as amended)...........................
10.3 (A) Lease dated April 10, 1991 for Registrant's office equipment at 11020 White Rock Road,
Rancho Cordova, California and 104 Wilmot Road, Deerfield, Illinois.................
10.4 (B) Lease dated June 15, 1992 for Registrant's facilities at 11020 White Rock Road, Rancho
Cordova, California.................................................................
10.5 (B) Form of Note and Security Agreement for Registrant's office equipment at 11020 White
Rock Road, Rancho Cordova, California...............................................
10.6 (B) Lease dated February 19, 1992 for Registrant's office equipment at 11020 White Rock
Road, Rancho Cordova, California and 104 Wilmot Road, Deerfield, Illinois...........
10.7 (A) Sale and Installation Agreement dated November 16, 1990 between Registrant and Aspect
Telecommunications Corporation......................................................
10.8 (B) Lease dated May 5, 1992 for Registrant's office equipment at 11020 White Rock Road,
Rancho Cordova, California and 104 Wilmot Road, Deerfield, Illinois.................
10.9 (K) Form of Director and Officer Indemnification Agreement................................
SEQUENTIALLY
EXHIBIT DESCRIPTION NUMBERED PAGE
- -------------- -------------------------------------------------------------------------------------- -----------------
10.10(C) Equipment Financing Agreement for Registrant's office and computer equipment at 11020
White Rock Road, Rancho Cordova, California and 3060 Salt Creek Lane, Arlington
Heights, Illinois...................................................................
10.11(E) First Amendment to Lease dated August 6, 1993 for Registrant's facility at 11020 White
Rock Road, Rancho Cordova, California...............................................
10.12(E) Lease dated August 13, 1993 for Registrant's facility at 3060 Salt Creek Lane,
Arlington Heights, Illinois.........................................................
10.13(E) Lease dated November 1, 1993 for Registrant's facility at 2510 W. Dunlap Drive,
Phoenix, Arizona....................................................................
10.14(D) Instruments Defining the Rights of Security Holders--Warrants for the Purchase of
Common Stock........................................................................
10.15(D) Instruments Defining the Rights of Security Holders--Registration Rights..............
10.16(D) Common Stock Purchase Option Agreement................................................
10.17(G) Registrant's 1995 Director Option Plan................................................
10.18(J) Registrant's 1996 Supplemental Stock Plan.............................................
10.19(F) Employment Agreement with Jeremy J. Nobel, M.D........................................
10.20(H)+ Amended and Restated Agreement of Limited Partnership of AHN..........................
10.21(H)+ Admission Agreement dated April 15, 1996..............................................
10.22(H)+ Partnership Interest Option Agreement dated April 15, 1996............................
10.23(H) Line of Credit Note dated May 7, 1996.................................................
10.24(K) Employment Agreement with Thomas E. Gardner dated December 1, 1996....................
10.25(L) Employment Agreement with Joseph P. Tallman dated November 18, 1996...................
10.26(M) AHN Partners, L.P., 8% Convertible Subordinated Debenture due 2001....................
10.27(M) Form of Change of Control/Severance Agreement for all named Executive Officers........
10.28(N) Amendment to Employment Agreement dated April 30, 1997 between Registrant and Kenneth
B. Plumlee..........................................................................
10.29(N) Amendment to Stock Option Agreement dated April 30, 1997 between Registrant and
Kenneth B. Plumlee..................................................................
10.30(N) Separation Agreement and Mutual Release dated April 30, 1997 between Registrant and
Thomas E. Gardner...................................................................
10.31(P) Employment Agreement dated December 1, 1996 between Registrant and Kenneth B.
Plumlee.............................................................................
10.32(P) Severance Agreement dated July 1, 1997 between Registrant and Kipp Johnson............
10.33(P) Consulting Agreement dated July 1, 1997 between Registrant and John V. Crisan.........
10.34(P) Employment Agreement dated November 18, 1996 between Registrant Timothy H. Connor.....
SEQUENTIALLY
EXHIBIT DESCRIPTION NUMBERED PAGE
- -------------- -------------------------------------------------------------------------------------- -----------------
10.35(P) Lease Agreement dated March 3, 1997 for Registrant's facility at 329 and 335
Interlocken Parkway, Broomfield, Colorado...........................................
10.36(P) Second Amended and Restated Agreement of Limited Partnership of AHN Partners, L.P.,
dated November 1, 1997..............................................................
10.37(Q) Registrant's 1998 Stock Option Plan...................................................
23.1 Consent of Ernst & Young LLP, Independent Auditors....................................
23.2 Consent of Arthur Andersen LLP, Independent Public Accountants........................
23.3 Consent from Alexander, Aronson, Finning & Co., P.C.
23.4 Consent of Wilson Sonsini Goodrich & Rosati, PC (Included with Exhibit 5.1)...........
24.1 (R) Power of Attorney.....................................................................
- ------------------------
(A) Incorporated by reference to Registrant's Form S-1 Registration Statement
No. 33-44604.
(B) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1992.
(C) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
March 31, 1993.
(D) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1993.
(E) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1993.
(F) Incorporated by reference to Registrant's Form 10-K/A for the year ended
September 30, 1995.
(G) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
December 31, 1995.
(H) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1996.
(I) Incorporated by reference to Registrant's Registration Statement on Form S-4
(No. 333-13931).
(J) Incorporated by reference to Registrant's Registration Statement on Form S-8
(No. 333-18163).
(K) Incorporated by reference to Registrant's Form 10-K for the year ended
September 30, 1996.
(L) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
December 31, 1996.
(M) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
March 31, 1997.
(N) Incorporated by reference to Registrant's Form 10-Q for the quarter ended
June 30, 1997.
(O) Incorporated by reference to Registrant's Registration Statement on Form 8-A
filed on March 13, 1997 (No. 000-19758).
(P) Incorporated by reference to Registrant's Form 10-K/A for the year ended
September 30, 1997.
(Q) Incorporated by reference to Registrant's Form 10-Q/A for the quarter ended
March 31, 1998.
(R) Incorporated by reference to Registrant's Form S-4 Registration Statement
No. 333-56253.
+ Confidential treatment granted for portions of document.