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Filed by Orthodontic Centers of America, Inc.
pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12 under the
Securities Exchange Act of 1934.
Subject Company: Orthodontic Centers of America, Inc.
Commission File No.: 1-13457
NEWS RELEASE
FOR IMMEDIATE RELEASE
CONTACTS: Orthodontic Centers of America, Inc. OrthAlliance, Inc.
John C. Glover James C. Wilson
Vice President of Investor Relations Chief Financial Officer
(904) 280-6285 (310) 792-1300
ORTHODONTIC CENTERS OF AMERICA AND ORTHALLIANCE
ANNOUNCE STATUS OF MERGER RELATED AMENDMENTS
METAIRIE, Louisiana (June 28, 2001) - Orthodontic Centers of America,
Inc. (NYSE: OCA) and OrthAlliance, Inc. (NASDAQ/NM: ORAL) announced today that
they have received signed amendments to the employment agreements and service or
consulting agreements of OrthAlliance affiliated professionals representing more
than the minimum threshold amounts specified as a condition to OCA's obligation
to close its proposed merger with OrthAlliance. As previously announced, OCA and
OrthAlliance entered into a definitive merger agreement on May 16, 2001, whereby
a wholly-owned subsidiary of OCA would merge into OrthAlliance in a
stock-for-stock transaction, with OrthAlliance becoming a wholly-owned
subsidiary of OCA.
Under the terms of the merger agreement, OCA's obligation to complete
the merger is conditioned upon, among other things, at least 56 of 184
designated OrthAlliance affiliated professionals, and a number of those
OrthAlliance affiliated professionals representing at least 30% of
OrthAlliance's annual service fees, amending their respective employment
agreement and OrthAlliance service or consulting agreement on terms specified in
the merger agreement. Completion of the proposed merger is subject to a number
of other conditions, including approval by stockholders of OrthAlliance. The
merger is anticipated to close in the third quarter of 2001 and to be accounted
for as a purchase.
W. Dennis Summers, Chairman of the Board and interim President and
Chief Executive Officer of OrthAlliance, said, "We are not surprised to have
received so many amendments this quickly, and we expect to continue the brisk
pace of OrthAlliance allied professionals willing to amend their applicable
agreements in accordance with terms described in the merger agreement.
Increasingly, these professionals are recognizing the wisdom in receiving the
full suite of OCA's powerful package of business services as a clear, proven
vehicle for practice growth."
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Bart F. Palmisano, Sr., Chief Executive Officer, President and Chairman
of the Board of OCA, said, "We have been focused diligently the past several
weeks meeting with virtually all of OrthAlliance's outstanding affiliated
orthodontists and pediatric dentists, and we continue to be impressed with their
high level of professionalism and commitment to quality. We look forward to
welcoming this highly regarded and exceptionally talented group to our
organization. We are excited about our combined prospects for growth and our
continued ability to build shareholder value."
About Orthodontic Centers of America, Inc.
Orthodontic Centers of America, Inc., founded in 1985, is the leading
provider of integrated business services to orthodontic practices. As of March
31, 2001, OCA was affiliated with over 400 orthodontists who were treating over
350,000 patients in over 600 orthodontic centers throughout the United States
and in Japan, Mexico and Spain. For additional information on Orthodontic
Centers of America, Inc., visit the Company's web site: http://www.4braces.com.
About OrthAlliance, Inc.
OrthAlliance, Inc. is a leading provider of practice management and
consulting services to orthodontic and pediatric dentistry practices in the
United States. As of March 31, 2001, OrthAlliance was affiliated with 226
orthodontists and pediatric dentists practicing in 395 centers throughout the
United States.
Certain statements contained in this news release may not be based on historical
facts and are "forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements may be
identified by their reference to a future period or periods or by the use of
forward-looking terminology, such as "anticipate," "believe," "estimate,"
"expect," "may," "might," "will," "would," or "intend." These forward-looking
statements include, without limitation, those relating to execution of
amendments by OrthAlliance affiliated professionals, growth, shareholder value,
benefits to OrthAlliance's affiliated professionals, accounting treatment of the
merger and completion of the merger. We caution you not to place undue reliance
on the forward-looking statements contained in this release in that actual
results could differ materially from those indicated in such forward-looking
statements, due to a variety of factors. Those factors include, but are not
limited to, failure or delay in obtaining required stockholder approval, failure
to obtain acceptable amendments to the employment agreements and service or
consulting agreements of OrthAlliance affiliated professionals, the companies'
failure to consummate the merger, inability to successfully integrate the
companies after the merger, adverse changes in the companies' financial results
and conditions, changes in general economic conditions and business conditions,
changes in OCA's operating or expansion strategy, the ability of OCA to attract
and retain qualified personnel and orthodontists, the ability of OCA to
effectively market its services and products, OCA's expectations and estimates
concerning future financial performance, financing plans and the impact of
competition, anticipated trends in OCA's business, existing and future
regulations affecting OCA's business,
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OCA's dependence on existing sources of funding, and other factors generally
understood to affect the financial results of orthodontic practice management
companies, and other risks detailed from time to time in OCA's releases and
Annual Report on Form 10-K for the year ended December 31, 2000 and other
filings with the Securities and Exchange Commission. We undertake no obligation
to update these forward-looking statements to reflect events or circumstances
that occur after the date on which such statements were made.
In connection with the proposed merger, OCA will file a registration statement
on Form S-4 with the Securities and Exchange Commission ("SEC"). Investors are
urged to read the proxy statement/prospectus that will be part of the
registration statement, because it will contain important information about the
merger, OCA and OrthAlliance. After the registration statement is filed with the
SEC, the registration statement and the proxy statement/prospectus will be
available free of charge, both on the SEC's web site (www.sec.gov) and from OCA
and OrthAlliance by directing a request to Orthodontic Centers of America, Inc.,
5000 Sawgrass Village Circle, Suite 30, Ponte Vedra Beach, FL 32082, Attention:
Investor Relations, or to OrthAlliance, Inc., 21535 Hawthorne Boulevard, Suite
200, Torrance, CA 90503, Attention: Investor Relations. OrthAlliance and its
directors and officers may be deemed to be participants in the solicitation of
proxies with respect to a shareholder meeting to be held in connection with such
merger. Information about the participants in the solicitation, including their
interests in shares of OrthAlliance's common stock, is set forth in
OrthAlliance's Annual Report on Form 10-K for the year ended December 31, 2000
filed with the SEC. Investors may obtain additional information regarding the
interests of OrthAlliance and its directors and officers by reading the proxy
statement/prospectus when it becomes available.
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