As filed with the Securities and Exchange Commission on July 12, 2001
Registration No. 333-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
MIM CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 05-0489664
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
MIM Corporation
100 Clearbrook Road
Elmsford, New York 10523
(914) 460-1600
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Barry A. Posner
MIM Corporation
100 Clearbrook Road
Elmsford, New York 10523
(914) 460-1600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies requested to:
E. William Bates, II
King & Spalding
1185 Avenue of the Americas
New York, New York 10036
(212) 556-2100
--------------------------
Approximate date of commencement of proposed sale to public: From
time to time after the effective date of this Registration Statement.
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. [ ]
CALCULATION OF REGISTRATION FEE
===================================================================================================================================
Proposed Proposed
Maximum Maximum
Title of Shares Amount To Be Aggregate Price Aggregate Amount Of
To Be Registered Registered Per Share (1) Offering Price (1) Registration Fee
- --------------------------------------- ---------------- --------------------- ---------------------- --------------------
Common stock, par value $.0001 per
share................................. 2,697,947 $6.11 $16,484,456.17 $4,121.11
========================================== ================= ===================== ====================== =====================
(1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c).
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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
===================================================================================================================================
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Subject to Completion, Dated July 12, 2001
PROSPECTUS
MIM CORPORATION
---------------------------
2,697,947 Shares of Common Stock
(par value $.0001 per Share)
---------------------------
This prospectus relates to the offering from time to time of up to
2,697,947 shares of common stock of MIM Corporation by one of our stockholders.
We will not receive any of the proceeds from the sale of the shares being
offered. We are registering these shares, but the registration of such shares
does not necessarily mean that any of such shares will be offered or sold by the
selling stockholder.
The selling stockholder from time to time may offer and sell the
shares directly to purchasers or through agents, underwriters or dealers on
terms to be determined at the time of sale. If required, the names of any
agents, underwriters or dealers and any other required information will be set
forth in an accompanying prospectus supplement.
The common stock is listed on the Nasdaq National Market under the
symbol "MIMS." On July 11, 2001, the last sale price of our common stock as
reported on the Nasdaq National Market was $6.11 per share.
Investing in the common stock involves certain risks. See "Risk
Factors" beginning on page 3 for a discussion of these risks.
The information in this prospectus is not complete and may be
changed. The selling stockholder may not sell these securities until the
registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities and it is
not soliciting an offer to buy these securities in any state where the offer or
sale is not permitted.
---------------------------
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or passed
upon the accuracy or adequacy of this prospectus. Any representation to the
contrary is a criminal offense.
---------------------------
The date of this prospectus is July 12, 2001.
TABLE OF CONTENTS
Page
About This Prospectus................................................. 1
Where You Can Find More Information................................... 1
MIM Corporation....................................................... 3
Risk Factors.......................................................... 3
Special Note Regarding Forward-Looking Statements..................... 9
Use of Proceeds....................................................... 10
Selling Stockholder................................................... 10
Plan of Distribution.................................................. 10
Validity of Common Stock.............................................. 12
Experts............................................................... 12
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed
with the Securities and Exchange Commission using a "shelf" registration
process. Under this shelf process, one of our stockholders, which we refer to as
the selling stockholder, may sell up to an aggregate of 2,697,947 shares of
common stock in one or more offerings. You should read this prospectus and any
applicable prospectus supplement provided to you together with the additional
information described under the heading "Where You Can Find More Information."
The registration statement that contains this prospectus (including
the exhibits to the registration statement) contains additional information
about our company and the securities offered under this prospectus. That
registration statement can be read at the SEC web site or at the SEC offices
mentioned under the heading "Where You Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document we file with the SEC at its public reference facilities at 450
Fifth Street, N.W., Washington, D.C. 20549. You can also obtain copies of the
documents at prescribed rates by writing to the Public Reference Section of the
SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
facilities. Our SEC filings are also available at the office of the Nasdaq
National Market, Inc. at 1735 K Street, N.W., Washington, D.C. 20006-1506.
The SEC allows us to incorporate by reference into this prospectus
the information that we file with the SEC, which means that we disclose
important information to you by referring to these documents and the information
contained therein. The information incorporated by reference is an important
part of this prospectus and the accompanying prospectus supplement. In addition,
any information that we file with the SEC subsequent to the date of this
prospectus will automatically update this prospectus. We incorporate by
reference the documents listed below and any filings that we make with the SEC
1
under sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
after the initial filing of the registration statement that contains this
prospectus and prior to the time that the selling stockholder sells all of the
common stock offered by this prospectus:
o Annual Report on Form 10-K for fiscal year ended December 31, 2000.
o Quarterly Report on Form 10-Q for the period ended March 31, 2001.
o The description of the common stock included in our Registration
Statement on Form 8-A/A dated May 20, 1999.
You may request a copy of these filings (other than an exhibit to a
filing unless that exhibit is specifically incorporated by reference into that
filing) at no cost, by writing to or telephoning us at the following address:
MIM Corporation
100 Clearbrook Road
Elmsford, New York 10523
(914) 460-1600
Attn: General Counsel
You should only rely on the information incorporated by reference or
set forth in this prospectus or any applicable prospectus supplement. We have
not authorized anyone else to provide you with different information. We are
only offering these securities in states where the offer is permitted. You
should not assume that the information in this prospectus or the applicable
prospectus supplement is accurate as of any date other than the dates on the
front of such documents.
2
MIM CORPORATION
We are a pharmacy benefit management, specialty pharmaceutical and
fulfillment/e-commerce organization that partners with healthcare providers and
sponsors to control prescription drug costs. Our pharmacy benefit products and
services use clinically sound guidelines to ensure cost control and quality
care. Our specialty pharmaceutical division specializes in serving the
chronically ill afflicted with life threatening diseases and genetic
impairments. Our fulfillment and e-commerce pharmacy specializes in serving
individuals that require long-term maintenance medications. Our online pharmacy,
www.MIMRx.com, develops private label websites to offer affinity groups and
healthcare providers innovative and customized health information services and
products on the Internet for the benefit of their members.
We are incorporated under the laws of the State of Delaware. Our
principal executive offices are located at 100 Clearbrook Road, Elmsford, New
York 10523, and our telephone number is (914) 460-1600.
RISK FACTORS
You should carefully consider the following factors and other
information included or incorporated by reference in this prospectus before
deciding to invest in shares of common stock.
We face substantial competition in our industries. The pharmacy
benefit management industry, which we refer to as the PBM industry, the
prescription mail service and the specialty pharmaceutical businesses are highly
competitive and many of our current and potential competitors have considerably
greater financial, technical, marketing and other resources than we do. The PBM
business includes a number of large, well-capitalized companies with nationwide
operations and many smaller organizations typically operating on a local or
regional basis. One of the larger organizations is owned by or otherwise related
to a brand name drug manufacturer and may have significant influence on the
distribution of pharmaceuticals.
We also compete with several national and regional companies that
primarily provide therapeutic pharmaceutical services to the chronically ill and
genetically impaired, many of which also have substantial financial resources.
Some of these competitors have been in the specialty pharmaceutical industry
considerably longer than we have and have secured long-term supply or
distribution arrangements for prescription pharmaceuticals necessary to treat
certain chronic disease states on price terms substantially more favorable than
the terms currently available to us. As a result of such advantageous pricing,
we may be unable to compete with these companies on particular prescription
products or in particular disease states.
Any change in our relationship with managed care organizations
providing health and prescription benefits under Tennessee's state health
program could reduce our profitability. Historically, a majority of our revenues
have been derived from providing PBM services in the state of Tennessee to
managed care organizations, or MCOs, participating in Tennessee's TennCare (R)
program. The TennCare (R) program operates under a demonstration waiver from the
United States Health Care Financing Agency, which is due to expire on
3
December 31, 2001. We provide our ongoing service to those MCOs under this
demonstration waiver program. If the waiver is not renewed, or we are not chosen
to continue to provide pharmacy benefits to enrollees of a successor program,
then the failure to provide such services would have a material adverse effect
on our financial position and results of operations. The ongoing funding for the
TennCare (R) program has been the subject of significant discussion at various
governmental levels since its inception. Should the funding sources for the
TennCare (R) program change significantly, our ability to serve those customers
could be impacted and would have a material adverse effect on our financial
position and results of operations.
Increases in the price of pharmaceuticals may reduce our revenues.
Under capitated arrangements, we are responsible for increases in prescription
costs, which adversely affects our gross profits. In such instances, we may be
required to increase capitated contract rates on new contracts and upon renewal
of existing capitated contracts. However, there can be no assurance that we will
be successful in obtaining these rate increases.
If we lose relationships with one or more key pharmaceutical
manufacturers or if the payments we receive from pharmaceutical manufacturers
decline, our business, profitability and growth prospects could suffer. We have
contractual relationships with numerous pharmaceutical manufacturers that pay us
rebate payments based on use of selected drugs by health plan members, as well
as fees for other programs and services. We believe our business, profitability
and growth prospects could suffer if:
o we lose relationships with one or more key pharmaceutical
manufacturers;
o rebates decline due to our failure to meet market share or other
thresholds;
o legal restrictions are imposed on the ability of pharmaceutical
manufacturers to offer formulary rebates or purchase our programs or
services; or
o pharmaceutical manufacturers choose not to offer formulary rebates or
purchase our programs or services.
Over the next few years, as patents expire covering many brand name
drugs that currently have substantial market share, generic products will be
introduced that may substantially reduce the market share of the brand name
drugs. Historically, manufacturers of generic drugs have not offered formulary
rebates on their drugs. If the use of newly-approved, brand name drugs added to
our formulary, which is the list of preferred prescription drugs covered by a
health plan, does not offset any decline in use of brand name drugs whose
patents expire, our profitability could be reduced.
If we lose pharmacy network affiliations, our business,
profitability and growth prospects could suffer. Our contracts with retail
pharmacies, which are non-exclusive, are generally terminable by either party on
short notice. If one or more of the top pharmacy chains elects to terminate its
relationship with us or if we are only able to continue our relationship on
terms less favorable to us, our members' access to retail pharmacies and our
business could suffer. In addition, some large retail pharmacy chains either own
or have strategic alliances with PBMs or could attempt to acquire or enter into
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these kinds of relationships with PBMs in the future. Ownership of, or alliances
with, PBMs by retail pharmacy chains could have a material adverse effect on our
relationships with these retail pharmacy chains and on our business,
profitability and growth prospects.
We are subject to heightened federal regulatory scrutiny, which
could result in sanctions or penalties. As a participant in the healthcare
industry, our operations and relationships are subject to extensive federal and
state laws and regulations and enforcement by federal and state governmental
agencies. There are significant uncertainties regarding the application of many
of these legal requirements to our business, and we cannot provide any assurance
that a regulatory agency charged with enforcement of any of these laws or
regulations will not interpret them differently or, if there is an enforcement
action brought against us, that our interpretation would prevail. In addition,
there are numerous proposed health care laws and regulations at the federal and
state levels, many of which could materially affect our ability to conduct our
business or adversely affect our results of operations. We are unable to predict
what additional federal or state legislation or regulatory initiatives may be
enacted in the future relating to our business or the health care industry in
general, or what effect any such legislation or regulations might have on us.
Under a corporate integrity agreement we entered into with the
Office of Inspector General or OIG, within the U.S. Department of Health and
Human Services or HHS, we are subject to increased oversight by the OIG. Should
the oversight procedures reveal credible evidence of any violation of federal
law, we are required to report such potential violations to the OIG and the U.S.
Department of Justice. We are therefore subject to increased regulatory scrutiny
and, if we commit legal or regulatory violations, we may be subject to an
increased risk of sanctions or penalties, including exclusion from participation
in the Medicare or Medicaid programs.
Subject to certain statutory and regulatory exceptions (including
exceptions relating to certain managed care, discount, group purchasing and
personal services arrangements), Federal law prohibits the payment or receipt of
remuneration to induce, arrange for or recommend the purchase of health care
items or services paid for in whole or in part by Medicare or state health care
programs (including Medicaid programs or Medicaid waiver programs, such as
TennCare (R)). Certain state laws may extend the prohibition to items or
services that are paid for by private insurance and self-pay patients. Our
arrangements with RxCare of Tennessee, Inc., a pharmacy services administrative
organization owned by the Tennessee Pharmacists Association, and other pharmacy
network administrators, drug manufacturers, marketing agents, brokers, health
plan sponsors, pharmacies and others parties routinely involve payments to or
from persons who provide or purchase, or recommend or arrange for the purchase
of, items or services paid in part by the TennCare (R) program or by other
programs covered by such laws. We carefully consider the importance of such
"anti-kickback" laws when structuring our operations, and believe that we are in
compliance with such laws. Violation of the Federal anti-kickback statute could
subject us to criminal and/or civil penalties, including exclusion from Medicare
and Medicaid (including TennCare (R)) programs or state-funded programs in the
case of state enforcement.
The federal anti-kickback law has been interpreted broadly by
courts, the OIG and administrative bodies. Because of the federal statutes,
broad scope, federal regulations establish certain safe harbors from liability.
5
Safe harbors exist for certain properly reported discounts received from
vendors, certain investment interest, and certain properly disclosed payments
made by vendors to group purchasing organizations, as well as for other
transactions or relationships. In late 1999, HHS adopted final rules revising
the discount safe harbor to protect certain rebates. Because this revision is
fairly recent, the guidance on how the safe harbor revision will be interpreted
is not fully developed. Nonetheless, a practice that does not fall within a safe
harbor is not necessarily unlawful, but may be subject to scrutiny and
challenge. In the absence of an applicable exception or safe harbor, a violation
of the statute may occur even if only one purpose of a payment arrangement is to
induce patient referrals or purchases. Among the practices that have been
identified by the OIG as potentially improper under the statute are certain
"product conversion programs" in which benefits are given by drug manufacturers
to pharmacists or physicians for changing a prescription (or recommending or
requesting such a change) from one drug to another. Anti-kickback laws have been
cited as a partial basis, along with state consumer protection laws, for
investigations and multi-state settlements relating to financial incentives
provided by drug manufacturers to retail pharmacies in connection with such
programs.
Certain governmental entities have commenced investigations of PBM
companies and other companies having dealings with the PBM industry and have
identified issues concerning selection of drug formularies, therapeutic
substitution programs and discounts or rebates from prescription drug
manufacturers. Additionally, at least one state has filed a lawsuit concerning
similar issues against a health plan. To date, we have not been the subject of
any such investigation or suit and have not received subpoenas or been requested
to produce documents for any such investigation or suit. However, there can be
no assurance that we will not receive subpoenas or be requested to produce
documents in pending investigations or litigations in the future.
We believe that we are in compliance with the legal requirements
imposed by the anti-remuneration laws and regulations, and we believe that there
are material and substantial differences between drug switching programs that
have been challenged under these laws and the therapeutic interchange practices
and formulary management programs offered by us to our customers. However, there
can be no assurance that we will not be subject to scrutiny or challenge under
such laws or regulations, or that any such challenge would not have a material
adverse effect upon us.
Pending and future litigation could materially affect our
relationships with pharmaceutical manufacturers or subject us to significant
monetary damages. Since 1993, retail pharmacies have filed over 100 separate
lawsuits against pharmaceutical manufacturers, wholesalers and certain PBMs,
challenging brand name drug pricing practices under various state and federal
antitrust laws. The plaintiffs alleged, among other things, that the
manufacturers had offered, and certain PBMs had knowingly accepted, discounts
and rebates on purchases of brand name prescription drugs that violated the
Federal Sherman Act and the Federal Robinson-Patman Act. Some manufacturers
settled certain of these actions, including a Sherman Act case brought on behalf
of a nationwide class of retail pharmacies. The class action settlements
generally provided for commitments by the manufacturers in their discounting
practices to retail pharmacies. The defendants who did not settle won the
6
Sherman Act class action on a directed verdict. With respect to the cases filed
by plaintiffs who opted out of the class action, some drug manufacturers have
settled certain of these actions, but such settlements are not part of the
public record. The Robinson-Patman Act cases are still pending.
We are not currently a party to any of these proceedings. To date,
we do not believe any of these settlements have had a material adverse effect on
our business. However, we cannot provide any assurance that the terms of the
settlements will not materially adversely affect us in the future or that we
will not be made a party to any separate lawsuit. In addition, we cannot predict
the outcome or possible ramifications to our business of the Robinson-Patman Act
cases.
If legislative or regulatory initiatives restrict our ability to use
patient identifiable medical information, our clinical programs and our business
growth strategy based on these services could suffer. Through our health
improvement programs, we help our health plan sponsor customers identify
individuals who will most benefit from the programs. Governmental restrictions
on the use of patient identifiable information may adversely affect our ability
to conduct health improvement programs and medical outcome studies and could
adversely affect our growth strategy based on these programs. Federal and state
legislation has been proposed, and some state laws have been enacted, to
restrict the use and disclosure of patient identifiable medical information.
Legislation could be enacted in the future that severely restricts or prohibits
our use of patient identifiable information, which could harm our business,
profitability and growth prospects.
In December 2000, HHS issued final regulations regarding the privacy
of individually-identifiable health information pursuant to the Health Insurance
Portability and Accountability Act of 1996, or HIPAA. This final rule on privacy
applies to both electronic and paper records and imposes extensive requirements
on the way in which health care providers, health plan sponsors and their
business associates use and disclose protected information. The final rule gives
patients significant rights to understand and control how their protected health
information is used and disclosed. Direct providers, such as pharmacies, are
required to obtain patient consents for treatment, payment and health care
operations. For all uses or disclosures of protected information that do not
involve treatment, payment or health care operations, the rule requires that all
covered entities obtain a valid patient authorization. In most cases, use or
disclosure of protected health information must be limited to the minimum amount
necessary to achieve the purpose of the use or disclosure. Organizations subject
to the rule will have approximately two years to comply with its provisions. In
addition, HHS has proposed, but not yet finalized, regulations pursuant to HIPAA
that govern the security of individually-identifiable health information.
Sanctions for failing to comply with standards issued pursuant to HIPAA include
criminal penalties and civil sanctions. Due to the complex and controversial
nature of the privacy regulations, they may be subject to court challenge, as
well as further legislative and regulatory actions that could alter their
effect. We cannot at this time predict with specificity what impact the recently
adopted final rule on the privacy of individually-identifiable health
information, or the proposed rule on security of individually-identifiable
health information may have on us. However, they will likely increase our burden
of regulatory compliance with respect to our health improvement programs and
other information-based products, and may reduce the amount of information we
may use if patients do not consent to such use. There can be no assurance that
the restrictions and duties imposed by the recently adopted final rule on the
privacy of individually-identifiable health information, or the proposed rule on
security of individually-identifiable health information, will not have a
material adverse effect on our business, profitability and growth prospects.
7
Even without new legislation and beyond the final federal
regulations, individual health plan sponsor customers could prohibit us from
including their patients' medical information in our various databases of
medical data. They could also prohibit us from offering services that involve
the compilation of such information.
The loss of a key employee could cause our business to suffer. Our
success is largely dependent on the services of Richard H. Friedman, our
Chairman and Chief Executive Officer, and to a lesser extent, other key
management personnel. We have an employment agreement with Mr. Friedman which
provides for his continued employment. However, we cannot assure you that we
will be able to retain his services or the services of any other key management
personnel. The loss of the services of one or more of our senior management
could cause our business, profitability and growth prospects to suffer.
We have anti-takeover provisions that could delay or prevent a
change in control, even if it would benefit stockholders. We have adopted
anti-takeover provisions that could delay or prevent a third party from gaining
control of us in a transaction that our board of directors has not negotiated
and approved, even if such change in control would be beneficial to our
stockholders. These anti-takeover provisions could depress the market price of
our common stock. These anti-takeover provisions include:
o change in control provisions in employment agreements with various
executive officers;
o restrictions on who may call a special meeting of stockholders; and
o a stockholders' rights plan.
The trading price of our common stock is volatile. The trading price
of our common stock could be subject to wide fluctuations in response to
quarter-to-quarter variations in our operating results, government regulatory
action, general conditions in the pharmaceutical industry, increased price
competition, changes in earnings estimates by analysts or other events or
factors, many of which are beyond our control. In addition, the stock market has
experienced extreme price and volume fluctuations.
8
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus may include or incorporate by reference
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, including statements regarding our expectations, hopes, beliefs,
intentions or strategies regarding the future. These statements may be included
in the information incorporated by reference above under "Where You Can Find
More Information." Forward looking statements may include statements relating
to:
o our business development activities;
o sales and marketing efforts;
o the status of material contractual arrangements including the
negotiation or re-negotiation of such arrangements;
o future capital expenditures;
o the effects of regulation and competition on our business and future
operating performance;
o the results, benefits and risks associated with integration of
acquired companies; and
o the likely outcome and the effect of legal proceedings on our business
and operations and/or the resolution or settlement thereof.
Investors are cautioned that any such forward looking statements are
not guarantees of future performance and involve risks and uncertainties, and
that actual results may differ materially from those possible results discussed
in the forward looking statements as a result of various factors. These factors
include, among other things, risks associated with risk-based or "capitated"
contracts, increased government regulation related to the health care and health
insurance industries in general and more specifically, pharmacy benefit
management organizations, the existence of complex laws and regulations relating
to our business, increased competition from our competitors, including
competitors with greater financial, technical, marketing and other resources.
Consequently, you should regard forward-looking statements only as
our current plans, estimates and beliefs. We do not promise to notify you if we
learn that our assumptions or projections are wrong for any reason. Before you
decide to invest in shares of common stock you should be aware that the factors
we discuss in the "Risk Factors" section in this prospectus could cause our
actual results to differ from what we have stated in any forward-looking
statements.
9
USE OF PROCEEDS
The selling stockholder will receive all net proceeds from the sale of
the common stock. We will not receive any of the proceeds from the sale of the
shares of common stock offered by the selling stockholder under this prospectus.
SELLING STOCKHOLDER
The following table sets forth, as of July 11, 2001, the identity of
the selling stockholder, the number of shares of common stock owned by the
selling stockholder prior to this offering and the number of shares of common
stock offered by the selling stockholder under this prospectus.
Because the selling stockholder may sell all, some or none of the
common stock offered under this prospectus, no estimate can be given as to the
amount of common stock that will be held by the selling stockholder upon
termination of the offering. See "Plan of Distribution."
Number of Shares
Beneficially Owned Maximum Number of
Name of Selling Stockholder Prior to the Offering Shares Being Offered
- ----------------------------------- ------------------------------- ---------------------------------
Livingston Group LLC*........... 2,697,947 2,697,947
- -------------
*A Schedule 13D filed on June 8, 2001 discloses that John Chay has sole voting
and dispositive power over these shares. Three of our employees are members of
Livingston Group LLC.
In connection with our acquisition of all of the interests of
American Disease Management Associates, LLC ("ADIMA"), the selling members of
ADIMA formed Livingston Group LLC as a holding company to hold those shares of
MIM issued as part of the consideration for the purchase of ADIMA. Under the
terms of the purchase agreement, Livingston cannot sell any shares of MIM issued
in connection with the purchase of ADIMA, until August 4, 2001, the one year
anniversary of the closing date of the acquisition, unless we waive this
provision. At the time of the acquisition, we entered into a registration rights
agreement with Livingston Group LLC which is incorporated by reference as an
exhibit to the registration statement, of which this prospectus forms a part.
PLAN OF DISTRIBUTION
This prospectus relates to the offer and sale by the selling
stockholder of up to 2,697,947 shares of common stock, par value $.0001 per
share.
The shares covered by this prospectus may be offered and sold from
time to time by the selling stockholder. The selling stockholder will act
independently of us in making decisions with respect to the timing, manner and
size of each sale. The selling stockholder may sell the shares being offered
hereby on the Nasdaq Stock Market, or otherwise, at prices and under terms then
prevailing, at prices related to the then current market price, or at negotiated
prices. Registration of the shares does not necessarily mean that any of the
shares will be offered by the selling stockholder.
10
The selling stockholder has advised us that it is not a party to any
agreement or other understanding to distribute the securities, directly or
indirectly.
Shares may be sold at any time and from time to time, when and if so
determined by the selling stockholder, by one or more of the following means of
distribution:
o block trades in which the broker-dealer so engaged will attempt to
sell such shares as agent, but may position and resell a portion of
the block as principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to this prospectus;
o over-the-counter distributions in accordance with the rules of the
NASD;
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and o privately negotiated transactions.
We will not receive any of the proceeds from the sale of shares by
the selling stockholder. We will bear all expenses in connection with the
registration of the common stock except that the selling stockholder will pay
all underwriting commissions and similar selling expenses, brokerage fees and
transfer taxes as well as fees of its counsel.
In connection with any distributions of the shares, the selling
stockholder may enter into hedging transactions with broker-dealers or other
financial institutions who may engage in short sales of our common stock in the
course of hedging the positions they assume with the selling stockholder. The
selling stockholder also may (i) sell the common stock short and redeliver the
shares to close out such short positions; (ii) enter into option or other
transactions with broker-dealers or other financial institutions which require
the delivery thereto of the shares offered hereby, which shares such
broker-dealer or other financial institutions may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction); or (iii)
pledge such shares to a broker-dealer or other financial institution, and, upon
a default, such broker-dealer or other financial institution, may effect sales
of such pledged shares pursuant to this prospectus (as supplemented or amended
to reflect such transaction). In addition, any such shares that qualify for sale
pursuant to Rule 144 under the Securities Act may be sold under that Rule rather
than pursuant to this prospectus.
In effecting sales, brokers, dealers or agents engaged by the
selling stockholder may arrange for other brokers or dealers to participate.
Brokers, dealers or agents may receive commissions, discounts or concessions
from the selling stockholder in amounts to be negotiated prior to the sale. Such
brokers or dealers may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales, and any such commissions,
discounts or concessions may be deemed to be underwriting discounts or
commissions under the Securities Act.
11
In order to comply with the securities laws of certain states, the
shares must be sold in such states only through registered or licensed brokers
or dealers. In addition, in certain states shares may not be sold unless they
have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirements is available and
has been complied with.
The rules and regulations in Regulation M under the Exchange Act
provide that during the period that any person is engaged in the distribution
(as defined therein) of common stock, such person generally may not purchase
shares of our common stock. The selling stockholder may be subject to such
regulation which may limit the timing of its purchases and sales of shares of
the common stock.
At the time a particular offer of shares is made, if required, a
prospectus supplement will be distributed that will set forth the number of
shares being offered and the terms of the offering, including the name of any
underwriter, dealer or agent, the purchase price paid by any underwriter, any
discount, commission and other item constituting compensation, any discount,
commission or concession allowed or reallowed or paid to any dealer, and the
proposed selling price to the public.
We have agreed to indemnify the selling stockholder, and any person
controlling it, against certain liabilities, including liabilities under the
Securities Act. The selling stockholder has agreed to indemnify us and certain
related persons against certain liabilities, including liabilities under the
Securities Act.
We have agreed with the selling stockholder to keep the registration
statement, of which this prospectus constitutes a part, effective until the
earlier of the sale of all the shares or 90 days following the effective date of
the registration statement.
Agents, underwriters or dealers may engage in transactions with or
perform services for us in the ordinary course of business.
VALIDITY OF COMMON STOCK
The validity of the common stock offered hereby will be passed upon
for us by Barry A. Posner, General Counsel of the Company.
EXPERTS
Our consolidated financial statements incorporated in this
prospectus by reference to our Annual Report on Form 10-K for the year ended
December 31, 2000, have been audited by Arthur Andersen LLP, independent
certified public accountants, as indicated in their report with respect thereto
12
and are included in this document in reliance upon the authority of said firm as
experts in accounting and auditing.
13
================================================================================
2,697,947 Shares
MIM CORPORATION
Common Stock
--------------------------
PROSPECTUS
--------------------------
July 12, 2001
================================================================================
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses Of Issuance And Distribution
SEC registration fee...................................... $ 4,121
Legal fees and expenses................................... $20,000
Accounting fees and expenses.............................. $20,000
Printing expenses......................................... $ 5,000
Miscellaneous............................................. $ 879
-------
Total........................................... $50,000
=======
Item 15. Indemnification Of Directors And Officers
Section 145 of the Delaware General Corporation law ("DGCL")
provides that a corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding whether civil, criminal or investigative (other than an
action by or in the right of the corporation) by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. Section 145 further
provides that a corporation similarly may indemnify any such person serving in
any such capacity who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor, against expenses (including
attorneys' fees) actually and reasonably incurred in connection with the defense
or settlement of such action or suit if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Delaware Court
of Chancery or such other court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnify for such expenses which the Court of Chancery or such
other court shall deem proper.
Section 102(b)(7) of the DGCL permits a corporation, in its
certificate of incorporation, to limit or eliminate, subject to some statutory
limitations, the liability of directors to the corporation or its stockholders
for monetary damages for breaches of fiduciary duty, except for liability (a)
for any breach of the director's duty of loyalty to the corporation or its
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) under Section 174 of
the DGCL (relating to unlawful payment of dividends and unlawful stock purchase
and redemption), or (d) for any transaction from which the director derived an
improper personal benefit. MIM's restated Certificate of Incorporation provides
that MIM's directors shall not be liable to the company or its stockholders for
breach of fiduciary duty as a director, except for liability arising out of
clauses (a) through (d) in the preceding paragraph. The Certificate of
Incorporation and MIM's by-laws further provide that MIM shall indemnify its
directors and officers to the fullest extent permitted by the DGCL. In addition,
MIM maintains director and officer liability insurance policies.
Item 16. Exhibits
3.1 -- Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to
the Registrant's Registration Statement on Form S-1, File No. 333-05327).
3.2 -- Amended and Restated By-Laws of the Registrant (incorporated by reference to Exhibit 3(ii) to the Company's
Quarterly Report on Form 10-Q for the period ended March 31, 1998).
4.1 -- Amended and Restated Rights Agreement dated as of May 20, 1999, between the Registrant and American Stock Transfer
and Trust Company (incorporated by reference to Exhibit 4.1 to Post-Effective Amendment No. 2 to the Registrant's
Form 8-A/A dated May 20, 1999).
4.2 -- Purchase Agreement among American Disease Management Associates, L.L.C., its Members and Certain Related Partners,
MIM Health Plans, Inc. and the Registrant, dated as of August 3, 2000 (incorporated by reference to Exhibit 2.1 to
the Registrant's Current Report on Form 8-K filed August 10, 2000).
4.3 -- Registration Rights Agreement between the Registrant and Livingston Group LLC dated as of August 3, 2000
(incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed August 10, 2000).
5.1 -- Opinion of Barry A. Posner.
23.1 -- Consent of Barry A. Posner (included as part of opinion
filed as Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in the
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than
20 percent 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;
provided, however, that paragraphs (a)(1)(i) and (a)(l)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or Form F-3,
and the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the 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 Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the city of Elmsford, State of New York, on July 11, 2001.
MIM CORPORATION
By: /s/ Barry A. Posner
---------------------------------------------
Barry A. Posner
Vice President, Secretary and
General Counsel
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the 11th day of July, 2001.
SIGNATURE TITLE
/s/ Richard H. Friedman Chairman of the Board, Chief
- --------------------------------------- Executive Officer and Director
Richard H. Friedman (Principal Executive Officer)
/s/ Juliet A. Palmer (Principal Financial Officer and
- --------------------------------------- Principal Accounting Officer)
Juliet A. Palmer
/s/ Richard A. Cirillo Director
- ---------------------------------------
Richard A. Cirillo
/s/ Louis DiFazio Director
- ---------------------------------------
Louis DiFazio
/s/ Harold J. Ford, Sr. Director
- ---------------------------------------
Harold J. Ford, Sr.
/s/ Michael Kooper Director
- ---------------------------------------
Michael Kooper
/s/ Louis A. Luzzi Director
- ---------------------------------------
Louis A. Luzzi
/s/ Ronald K. Shelp Director
- ---------------------------------------
Ronald K. Shelp
EXHIBIT INDEX
Exhibit Sequential
No. Description Of Exhibits Page No.
- ------------- ------------------------------------------------------------------------- --------
3.1 -- Amended and Restated Certificate of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.1 to the Registrant's Registration Statement on Form S-1, File
No. 333-05327).
3.2 -- Amended and Restated By-Laws of the Registrant (incorporated by reference to Exhibit
3(ii) to the Registrant's Quarterly Report on Form 10-Q for the period ended March 31,
1998).
4.1 -- Amended and Restated Rights Agreement dated as of May 20, 1999, between the Registrant
and American Stock Transfer and Trust Company (incorporated by reference to Exhibit 4.1
to Post-Effective Amendment No. 2 to the Registrant's Form 8-A/A dated May 20, 1999).
4.2 -- Purchase Agreement among American Disease Management Associates, L.L.C., its Members and
Certain Related Partners, MIM Health Plans, Inc. and the Registrant, dated as of August
3, 2000 (incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on
Form 8-K filed August 10, 2000)
4.3 -- Registration Rights Agreement between the Registrant and Livingston Group LLC dated as
of August 3, 2000 (incorporated by reference to Exhibit 4.1 to the Registrant's Current
Report on Form 8-K filed August 10, 2000).
5.1 -- Opinion of Barry A. Posner.
23.1 -- Consent of Barry A. Posner (included as part of opinion filed as Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
EXHIBIT 5.1
[Letterhead of MIM Corporation]
100 Clearbrook Road
Elmsford, New York 10523
July 11, 2001
MIM Corporation
100 Clearbrook Road
Elmsford, New York 10523
Ladies and Gentlemen:
I am the general counsel of MIM Corporation, a Delaware corporation
(the "Company"), and have represented the Company as such in connection with the
preparation of a Registration Statement on Form S-3 (the "Registration
Statement") to be filed with the Securities and Exchange Commission relating to
2,697,947 shares of common stock outstanding as of the date hereof that may be
sold by a certain stockholder of the Company (the "Shares").
In rendering the opinion set forth herein, I have examined and relied
upon such records, documents, certificates and other instruments as in my
judgment are necessary or appropriate to form the basis for the opinion
hereinafter set forth.
Based upon the foregoing, and in reliance thereon, and subject to the
qualifications, assumptions and exceptions set forth herein, I am of the opinion
that the Shares are validly issued, fully paid and nonassessable.
The foregoing does not express, or purport to express any opinion
with respect to the laws of any jurisdiction other than the laws of the State of
New York, the General Corporation Law of the State of Delaware and the federal
securities laws of the United States.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. This opinion is given as of the date hereof, and I
assume no obligation to update or supplement this opinion to reflect any facts
or circumstances which may occur after the date of this opinion.
I advise you that I am the Vice President and Secretary of the
Company in addition to being its General Counsel and that I own beneficially and
of record approximately 1.1% of its outstanding Shares.
Very truly yours,
/s/ Barry A. Posner
Barry A. Posner
General Counsel
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement on Form S-3 of our
report dated March 1, 2001 included in MIM Corporation's Form 10-K for the year
ended December 31, 2000 and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
July 11, 2001
Roseland, New Jersey
