-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DHO4cw7Ovib0syywAcEBb+KowBnYaesxY4YfuyIrihUEFOmWnwtDQFSpSD3Q3XKU soyFa6UcdM0wRwQvIyJ8tA== 0000898430-00-000350.txt : 20000214 0000898430-00-000350.hdr.sgml : 20000214 ACCESSION NUMBER: 0000898430-00-000350 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20000211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MCKESSON HBOC INC CENTRAL INDEX KEY: 0000927653 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-DRUGS PROPRIETARIES & DRUGGISTS' SUNDRIES [5122] IRS NUMBER: 943207296 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-85973 FILM NUMBER: 532719 BUSINESS ADDRESS: STREET 1: ONE POST ST STREET 2: MCKESSON PLAZA CITY: SAN FRANCISCO STATE: CA ZIP: 94104 BUSINESS PHONE: 4159838300 MAIL ADDRESS: STREET 1: ONE POST ST CITY: SAN FRANCISCO STATE: CA ZIP: 94104 FORMER COMPANY: FORMER CONFORMED NAME: MCKESSON CORP DATE OF NAME CHANGE: 19950209 FORMER COMPANY: FORMER CONFORMED NAME: SP VENTURES INC DATE OF NAME CHANGE: 19940728 S-3/A 1 AMENDMENT NO. 2 TO FORM S-3 As filed with the Securities and Exchange Commission on February 11, 2000 Registration No. 333-85973 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- AMENDMENT NO. 2 to FORM S-3 REGISTRATION STATEMENT under the Securities Act of 1933 ---------------- McKESSON HBOC, INC. (Exact name of Registrant as specified in its charter) Delaware 94-3207296 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification number)
McKesson Plaza One Post Street San Francisco, California 94104 (415) 983-8300 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) ---------------- Ivan D. Meyerson Senior Vice President, General Counsel and Corporate Secretary McKesson HBOC, Inc. McKesson Plaza, One Post Street San Francisco, California 94104 (415) 983-8300 (Name, address, including zip code, and telephone number, including area code, of agent for service) ---------------- Copies to: Gregg A. Noel Kristina Vesco Skadden, Arps, Slate, Meagher & Flom LLP Senior Counsel and Assistant Secretary 300 South Grand Avenue, Suite 3400 McKesson HBOC, Inc. Los Angeles, California 90071 McKesson Plaza, One Post Street (213) 687-5000 San Francisco, California 94104 (415) 983-8300
Approximate date of commencement of proposed sale to the public: From time to time 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 being offered only in connection with dividend or interest reinvestment plans, please 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. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +The information in this prospectus is not complete and may be changed. The + +selling stockholders 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 the selling + +stockholders are not soliciting an offer to buy these securities in any state + +where such offer of sale is not permitted. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subject to Completion, dated February 11, 2000 PROSPECTUS 1,368,243 Shares of Common Stock McKesson HBOC, Inc. McKesson Plaza One Post Street San Francisco, California 94104 (415) 983-8300 ------------ The stockholders of McKesson HBOC, Inc. listed below may offer from time to time 1,368,243 shares of our common stock under this prospectus. Our common stock is listed on the New York Stock Exchange, Inc. and the Pacific Exchange, Inc. under the trading symbol "MCK." On February 10, 2000, the closing price of one share of our common stock on the New York Stock Exchange was $19 1/8. An investment in our common stock involves risks. See the "Risk Factors" section beginning on page 1 of this prospectus. ------------ Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. ------------ The date of this prospectus is , 2000. TABLE OF CONTENTS Prospectus
Page ---- Risk Factors............................................................... 1 Special Note Regarding Forward-Looking Statements.......................... 5 The Company................................................................ 5 Use of Proceeds............................................................ 6 Selling Stockholders....................................................... 7 Description of Capital Stock............................................... 8 Plan of Distribution....................................................... 12 Experts.................................................................... 12 Legal Matters.............................................................. 13 Where You Can Find More Information........................................ 13
i RISK FACTORS You should carefully consider the following risks as well as the other information contained or incorporated by reference in this prospectus before purchasing our common stock. Adverse judgments regarding the restatement of our earnings may cause us to incur material losses. On April 28, 1999, we announced that, during the course of our year-end financial audit process, we determined that software sales transactions (aggregating $26.2 million for the fourth quarter ended March 31, 1999 and $16.0 million in the prior quarters of the fiscal year) were improperly recorded because they were subject to contingencies and had been reversed. We also announced that the audit process was ongoing. The Audit Committee of our board of directors subsequently initiated an investigation into this matter. On May 25, 1999, we announced that as a result of information developed through our continuing year-end internal and external audit process and Audit Committee review, additional instances of improper revenue recognition had been found, that further downward revision would be required of the results for the fiscal year ended March 31, 1999, as well as quarterly results during the fiscal year, and that prior years' results of the Health Care Information Technology Business unit could also require restatement. On July 14, 1999, we announced revised financial results for fiscal years ended March 31, 1999, 1998 and 1997. These restated results are included in our Annual Report on Form 10-K/A filed with the Securities and Exchange Commission. We revised downward our revenues by $245.8 million for the fiscal year ended March 31, 1999, by $48.1 million for the fiscal year ended March 31, 1998, and by $33.2 million for the fiscal year ended March 31, 1997. We revised downward our income from continuing operations by $152.2 million and our earnings per diluted share by 53 cents for the fiscal year ended March 31, 1999, by $25.8 million and nine cents for the fiscal year ended March 31, 1998, and by $13.5 million and five cents for the fiscal year ended March 31, 1997. Since our restatement announcement on April 28, 1999, and as of December 31, 1999, fifty-nine class action lawsuits, three derivative actions, and seven individual actions have been filed against us, and certain of our current or former officers and directors, in federal and state courts. In addition, the United States Attorney's Office for the Northern District of California and the San Francisco District Office of the United States Securities and Exchange Commission has also commenced investigations in connection with the matters relating to the restatement of previously reported amounts. We do not believe it is feasible to predict or determine the outcome or resolution of these proceedings, or to estimate the amount of, or potential range of, loss with respect to these proceedings. In addition, the timing of the final resolution of these proceedings is uncertain. The range of possible resolutions of these proceedings could include judgments against us or settlements that could require substantial payments by us which could cause us to incur material losses. The restatement of our earnings may negatively impact the management of our business. The effect of the pending litigation and government investigations relating to the previously announced financial restatement could present challenges in attracting and retaining quality employees and managers. Such difficulties could impair our ability to manage our business. Our business could be hindered if we are unable to complete and integrate acquisitions successfully. An element of our business is to pursue strategic acquisitions that either expand or complement our business. We routinely review such potential acquisition opportunities and have historically engaged in numerous acquisitions. Integration of acquisitions, including the merger that created McKesson HBOC, Inc., involve a number of special risks. Such risks include: . the diversion of management's attention to the assimilation of the operations of businesses we have acquired; 1 . difficulties in the integration of operations and systems and the realization of potential operating synergies; . difficulties in the integration of any acquired companies operating in a different sector of the health care industry; . delays or difficulties in opening and operating larger distribution centers in a larger and more complex distribution network; . the assimilation and retention of the personnel of the acquired companies; . challenges in retaining the customers of the combined businesses; and . potential adverse effects on operating results. If we are unable to successfully complete and integrate strategic acquisitions in a timely manner, our business and our growth strategies could be negatively affected. Our issuance of equity to finance acquisitions could have a potential dilutive effect on our stock. We anticipate that we will finance acquisitions, at least partly by incurring debt or by the issuance of additional securities. The use of equity financing, rather than debt, for acquisitions would dilute the ownership of our then current stockholders. Changes in the United States healthcare environment could have a material negative impact on our revenues. Our products and services are intended to function within the structure of the healthcare financing and reimbursement system currently being used in the United States. In recent years, the healthcare industry has changed significantly in an effort to reduce costs. These changes include increased use of managed care, cuts in Medicare, consolidation of pharmaceutical and medical/surgical supply distributors, and the development of large, sophisticated purchasing groups. We expect the healthcare industry to continue to change significantly in the future. Some of these changes, such as a reduction in governmental support of healthcare services or adverse changes in legislation or regulations governing the delivery or pricing of healthcare services or mandated benefits, may cause healthcare industry participants to greatly reduce the amount of our products and services they purchase or the price they are willing to pay for our products and services. Changes in pharmaceutical manufacturers' pricing or distribution policies could also significantly reduce our income. Due to the diverse range of health care supply management and health care information technology products and services we offer, such changes may adversely impact us while not affecting some of our competitors that offer a more narrow range of products and services. Substantial defaults in payment or a material reduction in purchases of our products by some large customers could have a significant negative impact on our financial condition, results of operations and liquidity. Our recent strategy has been to build relationships with large customers that are achieving rapid growth. During the fiscal year ended March 31, 1999, sales to our ten largest customers accounted for approximately 45% of our sales. A growing portion of our increased sales this year has been to a limited number of these large customers. Consequently, our sales and credit concentration have significantly increased. Accordingly, any defaults in payment or a material reduction in purchases of our products by these large customers could have a significant negative impact on our financial condition, results of operations and liquidity. Our credit rating may be downgraded which could increase our borrowing costs and could otherwise negatively affect our earnings. Our ratings from Duff & Phelps, Standard & Poor's and Moody's Investors Service, Inc. are on negative outlook. In October 1999, Duff & Phelps lowered our senior debt rating to BBB+ from A-. In December 1999, Standard & Poor's lowered our senior debt rating to BBB from BBB+. Any future downgrading of our credit 2 rating could result in an increase in our borrowing costs and impair our access to the public and private capital markets, including our ability to access the commercial paper markets. As a result, any downgrade of our credit ratings could have a negative impact on our earnings. The ability of the Health Care Information Technology business to attract and retain customers due to challenges in integrating software products, technological advances and Year 2000 concerns may significantly reduce our revenues. Our Health Care Information Technology business delivers enterprise-wide patient care, clinical, financial, managed care, payor and strategic management software solutions, as well as networking technologies, electronic commerce, outsourcing and other services to health care organizations throughout the United States and certain foreign countries. Challenges in integrating software products used by the Health Care Information Technology business with those of its customers could impair our ability to attract and retain customers and may reduce our revenues or increase our expenses. Future advances in the health care information systems industry could lead to new technologies, products or services that are competitive with the products and services offered by the Health Care Information Technology business. Such technological advances could also lower the cost of such products and services or otherwise result in competitive pricing pressure. The success of the Health Care Information Technology business will depend, in part, on its ability to be responsive to technological developments and challenges, including pricing pressures and changing business models. In addition, to remain competitive in the evolving health care information systems marketplace, the Health Care Information Technology business must develop new products on a timely basis. The failure to develop competitive products and to introduce new products on a timely basis could curtail the ability of the Health Care Information Technology business to attract and retain customers and thereby significantly reduce our net income. Finally, management believes that the costs of work by customers related to Year 2000 Issues have caused some Health Care Information Technology customers and prospective customers to defer current projects or prospective decisions regarding the acquisition of new software. These Year 2000 concerns by existing and potential new customers may adversely affect sales of our products. Proprietary technology protections may not be adequate and proprietary rights may infringe on rights of third parties. We rely on a combination of trade secret, patent, copyright and trademark laws, nondisclosure and other contractual provisions and technical measures to protect our proprietary rights in our products. There can be no assurance that these protections will be adequate or that our competitors will not independently develop technologies that are substantially equivalent or superior to our technology. Although we believe that our products and other proprietary rights do not infringe upon the proprietary rights of third parties, from time to time third parties have asserted infringement claims against us and there can be no assurance that third parties will not assert infringement claims against us in the future. Additionally, we may find it necessary to initiate litigation to protect our trade secrets, to enforce our patent, copyright and trademark rights, and to determine the scope and validity of the proprietary rights of others. These types of litigation can be costly and time consuming. These litigation expenses or any damage payments resulting from adverse determinations of third party claims could be significant and could result in material losses to us. Potential product liability claims arising from Health Care Information Technology business products could result in material losses to us. Some products of the Health Care Information Technology business provide information for use by health care providers in providing health care to patients. Although we have not experienced any material claims to date, any failure of our Health Care Information Technology business products to provide accurate and timely information could result in claims against us. We maintain insurance to protect against claims associated with 3 the use of such products, but there can be no assurance that our insurance coverage would adequately cover any claims asserted against us. If our insurance coverage is not adequate, we may be required to pay the damages which could result in material losses to us. System errors and warranties in our Health Care Information Technology business's products could cause unforeseen liabilities. Our Health Care Information Technology business's systems are very complex. As with complex systems offered by others, our systems may contain errors, especially when first introduced. The Health Care Information Technology business's systems are intended to provide information for health care providers in providing health care to patients. Therefore, users of its products have a greater sensitivity to system errors than the market for software products generally. Failure of a client's system to perform in accordance with its documentation could constitute a breach of warranty and could require us to incur additional expense in order to make the system comply with the documentation. If such failure is not timely remedied, it could constitute a material breach under a contract allowing the client to cancel the contract. Our failure to address the Year 2000 issue adequately may result in a significant disruption to our business. Software applications that use only two digits to identify a year in the date field may fail or create errors in the year 2000. This potential problem is known as the "Year 2000 Issue." As of the date hereof, we have not incurred any significant business disruptions as a result of the Year 2000 Issue. However, while no such occurrence has developed, problems due to the Year 2000 Issue, including those experienced by our customers, suppliers and other third parties on which we rely, may not become immediately apparent. For example, our Health Care Information Technology business may experience an increase in warranty claims relating to . malfunctions in our products which have not been upgraded, either because we have discontinued support for such products and have therefore not provided the necessary enhancement or because the customer has not installed an enhancement made available by us or . malfunctions resulting from the Year 2000 Issue in third-party hardware or software used in connection with the operation of our software products. Although such warranty claims are generally subject to contractual liability limitations, we are not able to accurately assess or estimate the possible impact of such claims. In addition, management believes that the costs of work by customers related to Year 2000 Issues have caused some Health Care Information Technology customers and prospective customers to defer current projects or prospective decisions regarding the acquisition of new software. We will continue to monitor our own Year 2000 compliance and that of our customers, suppliers and other third parties on which we rely. We cannot assure you that any Year 2000 problem which may develop would not significantly disrupt our business. 4 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain matters discussed under the captions "Risk Factors," "The Company" and "Financial Review" and elsewhere in this prospectus or in the information incorporated by reference constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Some of the forward-looking statements can be identified by the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seeks," "approximately," "intends," "plans," "estimates," or "anticipates" or the negative of those words or other comparable terminology. The discussion of financial trends, strategy, plans or intentions may also include forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. These include, but are not limited to the factors discussed under "Risk Factors" and "Financial Review" in this prospectus or in the information incorporated by reference. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned not to rely too heavily on these forward- looking statements. The forward-looking statements by their nature are not intended to be definitive predictions of future events. There is no general duty for us to update forward-looking statements. There is, however, a duty for us to correct information contained in this prospectus when a disclosure is misleading when made or when a statement that was accurate when made becomes misleading due to subsequent events. THE COMPANY On January 12, 1999, we completed the acquisition of HBO & Company, a health care information technology company, by exchanging 177 million shares of our common stock for all of the issued and outstanding shares of common stock of HBO & Company. Each share of HBO & Company was exchanged for 0.37 of a share of our common stock. We were renamed McKesson HBOC, Inc. The acquisition was structured as a tax-free reorganization and was accounted for as a pooling of interests. We are a leading health care supply management company in North America. In addition, we provide software solutions, technological innovation and comprehensive services to the health care industry, and through our Water Products segment, process and market pure drinking water. Our mission is to be the world leader in health care supply management and health care information technologies across the entire continuum of health care, through the operation of market-leading businesses in pharmaceutical and medical-surgical distribution and information technology and services for health care providers and payors. Our principal executive offices are located at McKesson Plaza, One Post Street, San Francisco, California 94104, and our telephone number is (415) 983- 8300. 5 USE OF PROCEEDS All net proceeds from the sale of the shares of our common stock will go to the stockholders who offer and sell their shares. Accordingly, we will not receive any of the proceeds from the sales of the shares of our common stock. 6 SELLING STOCKHOLDERS The selling stockholders obtained their shares of our common stock as a result of the merger of Automated Prescription Systems, Inc. with and into a subsidiary of McKesson HBOC, Inc., previously McKesson Corporation. In the Registration Rights Agreement, dated as of August 27, 1998, among us and the stockholders of Automated Prescription Systems, Inc., we agreed to register the shares of our common stock issued to the selling stockholders and to keep this registration statement effective for at least 120 days, or until all of the registered shares are sold under the registration statement, whichever comes first. Our registration of shares of our common stock does not necessarily mean that the selling stockholders will sell all or any of their shares of our common stock. Hibernia National Bank, as pledgee of some of the shares of our common stock, may offer shares of our common stock by this prospectus. In addition, donees and pledgees of shares of our common stock received from the selling stockholders after the date of this prospectus may offer shares of our common stock by this prospectus. The following table sets forth information about the shares of our common stock that are owned by the selling stockholders as of the date of this prospectus. The number of shares of our common stock owned by the selling stockholders after the offering assumes that all of the shares being offered under this prospectus are sold, and that the selling stockholders acquire no additional shares of our common stock before the completion of this offering. Each selling stockholder owns less than 1% of the total number of shares of our common stock outstanding.
Shares Owned Shares Owned Prior to Shares After Name of Record Selling Stockholder the Offering Being Offered the Offering - ---------------------------------- ------------ ------------- ------------ Baker Family Limited Partnership I.... 265,326 265,326 0 Diana Baker........................... 214,236 214,236 0 James R. Baker, Jr.................... 225,003 225,003 0 Mary P. Baker......................... 33,760 33,760 0 Bear Stearns Securities Corp.......... 154,443 154,443 0 Janelle Diane Hurst Holmstrom......... 19,181 19,181 0 Brian Jefferson Hurst................. 19,181 19,181 0 James R. Baker, Jr. Trustee for the Baker Family Trust for the Benefit of Sharon Baker Petrovsky............................ 8,594 8,594 0 James R. Baker, Jr. Trustee for the Baker Family Trust for the Benefit of Sharon Baker White ..................................... 12,506 12,506 0 James R. Baker, Jr. Trustee for the Baker Family Trust for the Benefit of Diana Baker White ..................................... 7,980 7,980 0 James R. Baker, Jr. Trustee for the Baker Family Trust for the Benefit of Diana Baker Foshee ..................................... 15,540 15,540 0 James R. Baker, Sr. & Mary Parker Baker Trust for the Benefit of the Baker Grandchildren........................ 57,546 57,546 0 Walter G. Pearson..................... 38,363 10,527 27,836 Rex Ponthie........................... 1,534 1,534 0 Rusty Baker Family Limited Partnership.......................... 122,764 122,764 0 Lena Smith............................ 3,836 3,836 0 Lena Smith, usufructuary with the right of disposition, Charles W. Smith, Jr., Charlene Smith LaCroix, Tommy R. Smith, Doris Jean Smith and Barbara Carolyn Smith Reynolds, as naked owners...................... 3,836 3,836 0 Sharon Baker White.................... 192,450 192,450 0
Diana Baker, James R. Baker, Jr., James R. Baker, Sr., Mary Parker Baker and Sharon Baker White served as directors of Automated Prescription Systems, Inc. prior to its merger with us. In addition, James R. Baker, Jr. was the Chief Executive Officer of Automated Prescription Systems, Inc. and currently serves as a consultant to us and Mary Parker Baker was its Secretary. 7 DESCRIPTION OF CAPITAL STOCK The following is a description of the material terms of our capital stock and of certain provisions of Delaware law. You should also read our Restated Certificate of Incorporation, as amended (the "Certificate"), and our Restated By-Laws, as amended (the "By-Laws"), and the Delaware law, and, regarding the rights of holders of shares of our common stock to purchase shares of our preferred stock, the Rights Agreement (as defined below under the heading "Rights Plan"). We have previously filed copies of such documents with the SEC. As of December 31, 1999, our capital stock consisted of 400,000,000 authorized shares of our common stock and 100,000,000 authorized shares of our preferred stock. Common Stock As of December 31, 1999, there were 281,745,630 shares of our common stock issued and outstanding. The holders of outstanding shares of our common stock are entitled to receive dividends out of assets legally available therefor at such times and in such amounts as our board of directors may from time to time determine. The shares of our common stock are neither redeemable nor convertible, and do not provide their holders with any preemptive or subscription rights to purchase any of our securities. Upon our liquidation, dissolution or winding up, the holders of our common stock are entitled to receive our assets which are legally available for distribution, after payment of all debts, other liabilities and any liquidation preferences of our outstanding preferred stock. Each outstanding share of our common stock is entitled to one vote on all matters submitted to a vote of stockholders. There is no cumulative voting. In February 1997, McKesson Financing Trust issued an aggregate of 4,000,000 5% Trust Convertible Preferred Securities and 123,720 5% Trust Convertible Common Securities (each, a "Trust Security"). Each Trust Security is convertible into our common stock at any time prior to the close of business on the business day prior to June 1, 2027 (or prior to the date of redemption of the Trust Security), at the option of the holder, at the rate of 1.3418 shares of our common stock for each Trust Security (equivalent to a conversion price of $37.26 per share of our common stock), subject to adjustment in certain circumstances. Preferred Stock As of the date hereof, there were no shares of our preferred stock issued and outstanding. Our board of directors is authorized to issue our preferred stock in classes or series and to fix the designations, preferences, qualifications, limitations, or restrictions of any class or series, the rate and nature of dividends, the price and terms and conditions on which shares may be redeemed, the amount payable in the event of voluntary or involuntary liquidation, the terms and conditions for conversion or exchange into any other class or series of the stock, voting rights and other terms. Of the 100,000,000 authorized shares of our preferred stock, 10,000,000 shares have been designated as Series A Junior Participating Preferred Stock (the "Series A Preferred Stock") and reserved for issuance under our Rights Agreement. Anti-takeover Effects of Provisions of Our Restated Certificate of Incorporation and By-Laws Our Certificate and By-Laws contain provisions that may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover attempt that a stockholder might consider to be in the stockholder's best interest. Such takeover attempts may include those which would result in a premium over the market price for the shares held by stockholders. The Certificate divides our board of directors into three classes serving staggered three-year terms. Directors can be removed from office only for cause and only by the affirmative vote of the holders of at least a majority of the voting power of the then outstanding shares of any class or series of our capital stock entitled to vote generally in the election of directors. Vacancies and newly created directorships on our board of directors may be filled only by a majority of the remaining directors or by the plurality vote of the stockholders. 8 The Certificate also provides that any action required or permitted to be taken by the holders of our common stock may be effected only at an annual or special meeting of such holders, and that the only other alternative available for stockholder action is by unanimous written consent. The By-Laws provide that special meetings of holders of our common stock may be called only by our chairman of the board or our president or our board of directors. Holders of our common stock are not permitted to call a special meeting or to require that our board of directors call a special meeting of stockholders. The By-Laws establish an advance notice procedure for the nomination, other than by or at the direction of our board of directors, of candidates for election as directors as well as for other stockholder proposals to be considered at annual meetings of stockholders. In general, we must receive notice of the intent of a stockholder to nominate a director or to raise business at such meetings not less than 90 nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting and such notice must contain information concerning the person to be nominated or the matters to be brought before the meeting and concerning the stockholder submitting the proposal. The Certificate also provides that some provisions of the By-Laws may only be amended by the affirmative vote of the holders of 75% of our outstanding stock entitled to vote. The Certificate also provides that, in addition to any affirmative vote required by law, the affirmative vote of holders of 80% of our voting stock and two-thirds of the voting stock other than voting stock held by an interested stockholder is necessary to approve some business combinations proposed by an interested stockholder. The foregoing summary outlines material provisions of the Certificate and By-Laws. You should also read the Certificate and By-Laws, copies of which have been filed with the SEC. Rights Plan Our board of directors declared a dividend distribution of one right (a "Right") for each outstanding share of our common stock to our stockholders of record at November 1, 1994 (the "Record Date"). As a result of the two-for-one stock split effective January 2, 1998, each share of our common stock has attached to it one-half of a Right. Each Right entitles the registered holder to purchase from us a unit consisting of one one-hundredth of a share of our Series A Preferred Stock at a purchase price of $100 per unit. The Rights expire on October 21, 2004, unless redeemed earlier by our board of directors. The terms of the Rights are set forth in a Rights Agreement, as amended, between us and a rights agent (the "Rights Agreement"). The following summary outlines the material provisions of the Rights Agreement. You should also read the Rights Agreement, a copy of which has been filed with the SEC. The Rights are attached to all of our common stock certificates representing shares outstanding at the Record Date and shares issued between the Record Date and the Distribution Date (as defined below), and no separate rights certificates (the "Rights Certificates") have been distributed. The Rights will separate from our common stock, separate Rights Certificates will be issued and a distribution date (the "Distribution Date") will occur when the first of the following events takes place: . ten business days following the date of a public announcement that there is an Acquiring Person (as defined below) (such date, the "Stock Acquisition Date"), . ten business days (or such later date as our board of directors may determine) following commencement of a tender or exchange offer that would result in the offeror beneficially owning 15% or more of our common stock, or . ten business days after our board of directors determines that the ownership of 10% or more of our outstanding common stock by a person is (1) intended to cause us to repurchase our common stock beneficially owned by such person or (2) is causing, or is reasonably likely to cause, a material adverse impact on us. 9 The term "Acquiring Person" means any person who, together with its affiliates and associates, acquires beneficial ownership of shares of our common stock representing 15% or more of our common stock, but shall not include us, any of our subsidiaries, any of our employee benefit plans or any of our subsidiaries' employee benefits plans, or any person or entity we organized, appointed or established for or under the terms of such plans. In the event that a person becomes an Acquiring Person (except in connection with an offer for all outstanding shares of our common stock which the independent directors determine to be fair to and otherwise in our best interests and that of our stockholders), following a Distribution Date, each holder of a Right will thereafter have the right to receive, upon exercise, our common stock (or, in certain circumstances, cash, property or other of our securities) having a calculated value equal to two times the exercise price of the Right. Notwithstanding the foregoing, following the occurrence of such event, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by an Acquiring Person and certain related persons and transferees will be null and void. However, Rights are not exercisable following the occurrence of such event until such time as the Rights are no longer redeemable as set forth below. At any time prior to the tenth day following the Stock Acquisition Date, we may redeem the Rights, in whole, but not in part, at a price of $.01 per Right. Until a Right is exercised, the holder of the Right, as such, will have no rights as our stockholder, including without limitation, the right to vote or to receive dividends. In general, the Rights Agreement may be amended by our board of directors (1) prior to the Distribution Date in any manner and (2) on or after the Distribution Date in certain respects including (A) to shorten or lengthen any time period and (B) in a manner not adverse to the interests of Rights holders. However, amendments extending the redemption period must be made while the Rights are still redeemable. The Rights have anti-takeover effects and will cause substantial dilution to a person or group that attempts to acquire us on terms not approved by our board of directors. The Rights should not interfere with any merger or other business combination approved by our board of directors, since our board of directors may redeem the Rights as provided above. Section 203 of Delaware General Corporation Law We are subject to the "business combination" statute of the Delaware General Corporation Law (Section 203). In general, such statute prohibits a publicly held Delaware corporation from engaging in a "business combination" with any "interested stockholder" for a period of three years after the date of the transaction in which the person became an "interested stockholder," unless: . such transaction is approved by our board of directors prior to the date the interested stockholder obtains such status, . upon consummation of such transaction, the "interested stockholder" beneficially owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned by (1) persons who are directors and also officers and (2) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or . the "business combination" is approved by our board of directors and authorized at an annual or special meeting of stockholders by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the "interested stockholder." A "business combination" includes mergers, asset sales and other transactions resulting in financial benefit to the "interested stockholder." An "interested stockholder" is a person who, together with its affiliates and 10 associates, owns (or within three years, did own) beneficially 15% or more of a corporation's voting stock. The statute could prohibit or delay mergers with us or other takeover or change in control attempts directed at us and, accordingly, may discourage attempts to acquire us. Effects of Authorized But Unissued Stock Our authorized but unissued shares of common stock and preferred stock may be issued without additional stockholder approval and may be utilized for a variety of corporate purposes, including future offerings to raise additional capital or to facilitate corporate acquisitions. The issuance of our preferred stock could have the effect of delaying or preventing a change in control of us. The issuance of our preferred stock could decrease the amount of earnings and assets available for distribution to the holders of our common stock or could adversely affect the rights and powers, including voting rights, of the holders of our common stock. In certain circumstances, such issuance could have the effect of decreasing the market price of our common stock. One of the effects of the existence of our unissued and unreserved common stock or preferred stock may be to enable our board of directors to issue shares to persons friendly to current management which could render more difficult or discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise, and thereby protect the continuity of management. Such additional shares could also be used to dilute the stock ownership of persons seeking to obtain control of us. As of January 31, 2000, we have reserved for issuance approximately 64,691,887 shares of our common stock for the exercise of options or grants of restricted stock which have been granted or which may be granted in the future to our directors, officers and employees and the conversion of the Trust Securities. We do not currently have any plans to issue shares of our preferred stock, although 10,000,000 shares have been designated Series A Preferred Stock in accordance with our Rights Agreement. Limitation of Directors Liability The Certificate contains a provision that limits the liability of our directors for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by the Delaware General Corporation Law. Such limitation does not, however, affect the liability of a director for: . any breach of the director's duty of loyalty to us or our stockholders, . acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, . unlawful dividend payments or stock redemptions or purchases, and . any transaction from which the director derives an improper personal benefit. The effect of this provision is to eliminate our rights and the rights of our stockholders (through stockholders' derivative suits on our behalf) to recover monetary damages against a director for breach of the fiduciary duty of care as a director (including breaches resulting from negligent or grossly negligent behavior) except in the situations described above. This provision does not limit or eliminate our rights or rights of any stockholder to seek non-monetary relief such as an injunction or rescission in the event of a breach of a director's duty of care. In addition, our directors and officers have indemnification protection. 11 PLAN OF DISTRIBUTION We are registering shares of our common stock on behalf of the selling stockholders. As used herein, "selling stockholders" include Hibernia National Bank, as pledgee of some of the shares of our common stock and any other donees and pledgees selling shares received from a named selling stockholder after the date of this prospectus. The selling stockholders or their respective successors in interest may offer their shares of our common stock at various times, depending on market conditions and other factors, in one or more transactions on any of the United States securities exchanges where our common stock is listed, including the New York Stock Exchange, Inc. and the Pacific Exchange, Inc., in the over-the-counter market or in transactions other than on such exchanges or in the over-the-counter market. The selling stockholders may sell their shares at market prices prevailing at the time of the sale, at negotiated prices or at fixed prices. The selling stockholders may offer their shares of our common stock in any manner permitted by law, including through underwriters, brokers, dealers or agents and directly to one or more purchasers. Sales of the shares of our common stock may involve: . sales to underwriters who will acquire the shares of our common stock for their own account and resell them in one or more transactions at fixed prices or at varying prices determined at the time of sale; . block transactions in which the broker or dealer engaged will attempt to sell the shares of our common stock as an agent but may position and resell a portion of the block as a principal to facilitate the transaction; . purchases by a broker or dealer as principal and resale by such broker or dealer for its account; . an exchange distribution in accordance with the rules of any such exchange; and . ordinary brokerage transactions and transactions in which a broker solicits purchasers. Brokers and dealers may receive compensation in the form of underwriting discounts, concessions or commissions from the selling stockholders and/or purchasers of shares of our common stock for whom they may act as agents (which compensation may be in excess of customary commissions). The selling stockholder and any broker or dealer that participates in the distribution of shares of our common stock may be deemed to be underwriters and any commissions received by them and any profit on the resale of shares of our common stock positioned by a broker or dealer may be deemed to be underwriting discounts and commissions under the Securities Act. In the event any selling stockholder engages an underwriter in connection with the sale of the shares of our common stock, if required, a prospectus supplement will be distributed, which will set forth the number of shares of our common stock being offered and the terms of the offering, including the names of the underwriters, any discounts, commissions and other items constituting compensation to underwriters, dealers or agents, the public offering price and any discounts, commissions or concessions allowed or reallowed or paid by underwriters to dealers. In addition, upon our being notified by a selling stockholder that a donee or pledgee intends to sell more than 500 shares, a supplement to this prospectus will be filed. In addition, the selling stockholders may from time to time sell shares of our common stock in transactions under Rule 144 promulgated under the Securities Act. In accordance with the Registration Rights Agreement, we will pay all registration expenses in connection with the registration of the shares of our common stock. We and the selling stockholders have agreed to indemnify each other against certain civil liabilities, including certain liabilities under the Securities Act. EXPERTS The consolidated financial statements and related consolidated financial statement schedule of McKesson HBOC, Inc. and its consolidated subsidiaries, except for HBOC & Company and its subsidiaries as of March 31, 1998 and 1997 and for the years then ended, included in McKesson HBOC, Inc.'s Annual Report on Form 10-K/A for the year ended March 31, 1999 which is incorporated by reference in this prospectus and 12 elsewhere in the registration statement have been audited by Deloitte & Touche LLP as stated in their report (which report expresses an unqualified opinion and includes an explanatory paragraph referring to certain shareholder litigation as discussed in Financial Note 19 to the consolidated financial statements) and have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. The financial statements of HBOC & Company and its subsidiaries referred to above (not separately presented herein), which are included in our Annual Report on Form 10-K/A for the year ended March 31, 1999 which is incorporated by reference in this prospectus and elsewhere in this registration statement, have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their report (which expresses an unqualified opinion and includes an explanatory paragraph related to certain shareholder litigation) with respect thereto, and are included herein in reliance upon the authority of said firm as experts in giving said report. LEGAL MATTERS Ivan D. Meyerson, our Senior Vice President, General Counsel and Corporate Secretary will issue an opinion about the validity of the shares of our common stock. Mr. Meyerson owns shares of, and holds options to purchase, in the aggregate, less than 1% of our common stock. WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any documents we file at the SEC's public reference rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC filings are also available to the public from the SEC's Website at "http://www.sec.gov." The SEC allows us to "incorporate by reference" the information we file with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus, and information we later file with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings we will make with the SEC under Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act: 1. Annual Report on Form 10-K for the fiscal year ended March 31, 1999, as amended (File No. 1-13252). 2. Quarterly Reports on Form 10-Q for the quarters ended June 30, 1999 and September 30, 1999 (File No. 1-13252). 3. Current Reports on Form 8-K, dated May 3, 1999, January 25, 2000 and February 1, 2000 (File No. 1-13252). You may request a copy of these filings, at no cost by writing or telephoning us at the following address: Ivan D. Meyerson Senior Vice President, General Counsel and Corporate Secretary McKesson HBOC, Inc. McKesson Plaza One Post Street San Francisco, California 94104 (415) 983-8300 You should rely only on the information incorporated by reference or provided in this prospectus or any prospectus supplement. We have not authorized anyone else to provide you with different information. The selling stockholders will not make an offer of the shares of our common stock in any state where the offer is not permitted. You should not assume that the information in this prospectus or any prospectus supplement is accurate as of any date other than the date on the front of those documents. 13 [MCKESSONHBOC LOGO APPEARS HERE] PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution. The following expenses (other than the Securities and Exchange Commission (the "Commission") filing fee) are estimated. Commission registration fee...................................... $11,317.00 Printing and engraving expenses.................................. 10,000.00 Accountants' fees and expenses................................... 20,000.00 Attorneys' fees and expenses..................................... 50,000.00 Miscellaneous.................................................... 4,683.00 ---------- Total.......................................................... $95,000.00 ==========
McKesson HBOC, Inc. (the "Company") will pay all registration expenses in connection with the registration of the shares of the Company's common stock. Item 15. Indemnification of Directors and Officers. Article VIII of the Restated By-Laws, as amended, of the Company (the "By- Laws"), in accordance with the provisions of Section 145 of the General Corporation Law of Delaware (the "Delaware Corporation Law"), provides that the Company shall indemnify any person in connection with any threatened, pending or completed legal proceeding (other than a legal proceeding by or in the right of the Company) by reason of the fact that such person is or was a director or officer of the Company or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership or other enterprise against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with such legal proceeding if such person acted in good faith and in a manner that such person reasonably believed to be in or not opposed to the best interests of the Company, and, in the case of any criminal action or proceeding, if such person had no reasonable cause to believe that his or her conduct was unlawful. If the legal proceeding is by or in the right of the Company, the director or officer may be indemnified by the Company against expenses (including attorneys' fees) actually and reasonably incurred in connection with the defense or settlement of such legal proceeding if 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 Company, except that such person may not be indemnified in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Company unless a court determines otherwise. Article VIII of the By-Laws allows the Company to maintain director and officer liability insurance on behalf of any person who is or was a director or officer of the Company or such person who serves or served as director, officer, employee or agent of another corporation, partnership or other enterprise at the request of the Company. Article VI of the Company's Restated Certificate of Incorporation, as amended, in accordance with Section 102(b)(7) of the Delaware Corporation Law, provides that no director of the Company shall be personally liable to the Company or its stockholders for monetary damages for any breach of such director's fiduciary duty as a director; provided, however, that such clause shall not apply to any liability of a director (1) for any breach of such director's duty of loyalty to the Company or its stockholders, (2) for acts or omissions that are not in good faith or involve intentional misconduct or a knowing violation of the law, (3) under Section 174 of the Delaware Corporation Law, or (4) for any transaction from which the director derived an improper personal benefit. II-1 Item 16. List of Exhibits.
Exhibit Number Description ------- ----------- 4.1 Restated Certificate of Incorporation of the Company (Exhibit 3.2(1)). 4.2 Certificate of Amendment to the Restated Certificate of Incorporation of the Company (Exhibit 4.3(2)). 4.3 Amended and Restated By-Laws of the Company, as amended through July 15, 1999 (Exhibit 4.5(3)). 4.4 Rights Agreement, dated as of October 21, 1994, by and between the Company and First Chicago Trust Company of New York as Rights Agent (Exhibit 4.7(3)). 4.5 Amendment No. 1 to Rights Agreement, dated as of October 19, 1998, by and between the Company and First Chicago Trust Company of New York as Rights Agent (Exhibit 99.1(4)) 5.1** Opinion of Ivan D. Meyerson, Senior Vice President, General Counsel and Corporate Secretary of the Company. 10.1** Registration Rights Agreement, dated as of August 27, 1998, by and among the Company and the Selling Stockholders. 23.1** Consent of Ivan D. Meyerson (included in Exhibit 5.1). 23.2* Consent of Deloitte & Touche LLP. 23.3* Consent of Arthur Andersen LLP. 24.1** Power of Attorney. 24.2** Power of Attorney.
- -------- (1) Incorporated by reference to the designated exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998. (2) Incorporated by reference to the designated exhibit to the Company's Registration Statement on Form S-8 as filed with the Commission on January 12, 1999. (3) Incorporated by reference to the designated exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999. (4) Incorporated by reference to designated exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1998. * Filed herewith. ** Previously filed. Item 17. Undertakings. (a) 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 this 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 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. II-2 (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 (i) and (ii) do not apply if 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 the 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. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Company's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered thereby, and the offering of such securities at the time shall be deemed to be the initial bona fide offering thereof. (c) 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 referred to in Item 15 of this registration statement, 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 of 1933 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. II-3 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 Amendment No. 2 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Francisco, State of California, on the 10th day of February, 2000. McKesson HBOC, Inc. By: /s/ Ivan D. Meyerson ---------------------------------- Name: Ivan D. Meyerson Title: Senior Vice President, General Counsel and Corporate Secretary Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the Registration Statement has been signed below by the following persons in the capacities and on the date indicated.
Signature Title --------- ----- * Co-President and _____________________________________________ Co-Chief Executive Officer and Director John H. Hammergren (principal executive officer) * Co-President and _____________________________________________ Co-Chief Executive Officer and Director David L. Mahoney (principal executive officer) * Senior Vice President and Controller and _____________________________________________ Acting Chief Financial Officer Heidi E. Yodowitz (principal financial and accounting officer) * Director _____________________________________________ Alfred C. Eckert * Director _____________________________________________ Tully M. Friedman * Director _____________________________________________ Alton F. Irby III * Director _____________________________________________ M. Christine Jacobs * Director _____________________________________________ Gerald E. Mayo
II-4
Signature Title --------- ----- * Director _____________________________________________ James V. Napier * Director _____________________________________________ David S. Pottruck * Director _____________________________________________ Carl E. Reichardt * Chairman of the Board and _____________________________________________ Director Alan Seelenfreund * Director _____________________________________________
Jane E. Shaw *By: /s/ Ivan D. Meyerson ------------------------------------ Ivan D. Meyerson Attorney-in-fact Dated: February 10, 2000 II-5 EXHIBIT INDEX
Exhibit Number Description ------- ----------- 23.2 Consent of Deloitte & Touche LLP. 23.3 Consent of Arthur Andersen LLP.
EX-23.2 2 CONSENT OF DELOITTE & TOUCHE LLP Exhibit 23.2 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Amendment No. 2 to Registration Statement No. 333-85973 of McKesson HBOC, Inc., on Form S-3 of our report dated July 12, 1999 (which report (1) was modified to indicate that the consolidated financial statements of HBO & Company ("HBOC"), as of and for the two years ended March 31, 1998 were audited by other auditors whose report (which expresses an unqualified opinion and includes an explanatory paragraph related to certain shareholder litigation) has been furnished to us, and our opinion, insofar as it relates to the amounts included for HBOC as of and for the years ended March 31, 1998 and 1997 is based solely on the report of such auditors, and (2) contained an explanatory paragraph referring to certain shareholder litigation as discussed in Financial Note 19 to the consolidated financial statements), appearing in the Annual Report on Form 10-K/A of McKesson HBOC, Inc., and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. DELOITTE & TOUCHE LLP San Francisco, California February 10, 2000 EX-23.3 3 CONSENT OF ARTHUR ANDERSEN LLP EXHIBIT 23.3 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement on Amendment No. 2 to Form S-3 of our report dated July 12, 1999 included in McKesson HBOC, Inc.'s Form 10-K/A for the year ended March 31, 1999 and to all references to our firm included in this registration statement. Reference is made to said report in which the opinion contains an explanatory fourth paragraph with respect to certain shareholder litigation as discussed in Note 10 to the consolidated financial statements. ARTHUR ANDERSEN LLP Atlanta, Georgia February 10, 2000 -----END PRIVACY-ENHANCED MESSAGE-----