<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                              ---------------------

                                    FORM 10-Q

 [X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
         OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 1997

         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to 
                               --------    ---------

                         Commission file number: 0-26090

                              COMPDENT CORPORATION
             (Exact name of registrant as specified in its charter)

               DELAWARE                                   04-3185995
    (State or other jurisdiction of                    (I.R.S. Employer
    incorporation or organization)                    Identification No.)

                              CompDent Corporation
                        100 Mansell Court East, Suite 400
                             Roswell, Georgia 30076
                    (Address of principal executive offices)

                                 (770) 998-8936
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
                                    Yes   X     No
     
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

              Class                              Outstanding at August 8, 1997
              -----                              -----------------------------
 Common Stock, $.01 par value                    10,106,039




<PAGE>   2





                      COMPDENT CORPORATION AND SUBSIDIARIES



                                      INDEX
<TABLE>
<CAPTION>
                                                                                          Page #
<S>                                                                                        <C>    
Part I.    Financial Information

           Item 1.       Financial Statements                                                4

           Item 2.       Management's Discussion and Analysis of Financial Condition
                         and Results of Operations                                          11

Part II.   Other Information

           Item 1.       Legal Proceedings                                                  15

           Item 2.       Changes in Securities                                              15

           Item 4.       Submission of Matters to a Vote of Security Holders                15

           Item 5.       Other Information                                                  15

           Item 6.       Exhibits and Reports Filed on Form 8-K                             15

Signatures                                                                                  16

Exhibit Index                                                                               17
</TABLE>


                                        2
<PAGE>   3



                        PART I. FINANCIAL INFORMATION

           This Quarterly Report on Form 10-Q contains forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. The Company's actual results
could differ materially from those set forth in the forward-looking statements.
Certain factors that might cause such a difference include, among others, risk
associated with the successful completion of new acquisitions, the effective
integration of new acquisitions, general competitive and pricing pressures in
the marketplace, and continued growth in the dental coverage marketplace. Other
risk factors are listed in the Company's Prospectus and in required filings with
the U.S. Securities and Exchange Commission.



                                        3
<PAGE>   4


ITEM 1. FINANCIAL STATEMENTS

                    COMPDENT CORPORATION AND SUBSIDIARIES
                         CONSOLIDATED BALANCE SHEETS
                                (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                          JUNE 30,      DECEMBER 31,     
                                                            1997           1996          
                                                            ----           ----          
                                                        (UNAUDITED)                      
<S>                                                       <C>           <C>              
                  ASSETS                                                                 
Current assets:                                                                          
     Cash and cash equivalents                            $ 43,730      $ 26,959         
     Premiums receivable from subscribers                    4,299         3,121         
     Income taxes receivable                                                 247         
     Deferred income taxes                                   2,121         3,106         
     Other current assets                                    2,661           650         
                                                          --------      --------         
         Total current assets                               52,811        34,083         
                                                          --------      --------         
                                                                                         
Restricted funds                                             2,252         2,070         
Property and equipment, net of accumulated depreciation      3,721         2,977         
Excess of purchase price over net assets acquired          135,643       135,040         
Noncompetition agreement                                       641           945         
Unamortized loan fees                                          134           189         
Reinsurance receivable                                       5,391         5,388         
Cash surrender value of officers' life insurance               148           140         
Deferred income taxes                                        1,928         2,026         
Other assets                                                 1,171         1,309         
                                                          --------      --------         
                                                          $203,840      $184,167         
                                                          ========      ========         
              LIABILITIES AND STOCKHOLDERS' EQUITY                                       
Current liabilities:                                                                     
     Unearned revenue                                     $  9,453      $  9,582         
     Accounts payable and accrued expenses                  10,064        10,956         
     Accrued interest payable                                  582           390         
     Income taxes payable                                      909                       
     Dental claims reserves                                  1,802         1,421         
     Other current liabilities                                 282         1,924         
                                                          --------      --------         
         Total current liabilities                          23,092        24,273         
                                                          --------      --------         
Aggregate reserves for life policies and contracts           5,351         5,338         
Notes payable                                               55,000        41,663         
Deferred compensation expense                                  318           338         
Other liabilities                                              449           372         
                                                          --------      --------         
         Total liabilities                                  84,210        71,984         
                                                          --------      --------         
Commitments and contingencies (Note 3)                                                   
Stockholders' equity:                                                                    
     Common stock                                              101           101         
     Additional paid-in capital                             97,544        95,820         
     Retained earnings                                      21,985        16,262         
                                                          --------      --------         
         Total stockholders' equity                        119,630       112,183         
                                                          --------      --------         
                                                          $203,840      $184,167         
                                                          ========      ========         
</TABLE>

The accompanying notes are an integral part of these financial statements.




                                        4


<PAGE>   5
                      COMPDENT CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATION
                      (IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>

                                                      THREE MONTHS ENDED
                                                            JUNE 30,
                                                       1997         1996
                                                       ----         ----
                                                   (UNAUDITED)  (UNAUDITED)
<S>                                                <C>          <C>    
Revenues:
     Subscriber premiums                            $ 35,852    $ 33,384
     Other revenue                                     2,348       1,377
                                                    --------    --------
         Total revenue                                38,200      34,761
                                                    --------    --------
Expenses:
     Dental care providers' fees and claim costs      19,906      17,967
     Commissions                                       3,192       3,091
     Premium taxes                                       256         264
     General and administrative                        7,967       7,831
     Depreciation and amortization                     1,355       1,287
                                                    --------    --------
         Total expenses                               32,676      30,440
                                                    --------    --------
              Operating income                         5,524       4,321
                                                    --------    --------
Other (income) expense:
     Interest income                                    (254)       (145)
     Interest expense                                    738         434
     Other, net                                          (16)       (299)
                                                    --------    --------
                                                         468         (10)
                                                    --------    --------

         Income before provision for income taxes      5,056       4,331
         Income tax provision                          2,172       1,924
                                                    --------    --------
               Net income                           $  2,884    $  2,407
                                                    ========    ========


Net Income per common share                         $   0.28    $   0.24
                                                    ========    ========

Weighted average common shares outstanding            10,179      10,185
                                                    ========    ========
</TABLE>


The accompanying notes are an integral part of these financial statements.




                                        5
<PAGE>   6






                    COMPDENT CORPORATION AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                     (IN THOUSANDS EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
                                                      SIX MONTHS ENDED
                                                         JUNE  30,
                                                      1997        1996
                                                      ----        -----
                                                   (UNAUDITED) (UNAUDITED)
<S>                                                 <C>         <C>   
Revenues:
     Subscriber premiums                            $ 71,488    $ 64,215
     Other revenue                                     4,547       1,932
                                                    --------    --------
         Total revenue                                76,035      66,147
                                                    --------    --------
Expenses:
     Dental care providers' fees and claim costs      39,450      34,448
     Commissions                                       6,364       6,104
     Premium taxes                                       521         523
     General and administrative                       15,827      14,603
     Depreciation and amortization                     2,676       2,334
                                                    --------    --------
         Total expenses                               64,838      58,012
                                                    --------    --------
              Operating income                        11,197       8,135
                                                    --------    --------
Other (income) expense:
     Interest income                                    (415)       (298)
     Interest expense                                  1,446         480
     Other, net                                          (61)       (309)
                                                    --------    --------
                                                         970        (127)
                                                    --------    --------

         Income before provision for income taxes     10,227       8,262
         Income tax provision                          4,504       3,618
                                                    --------    --------
              Net income                            $  5,723    $  4,644
                                                    ========    ========


Net Income per common share                         $   0.56    $   0.46
                                                    ========    ========

Weighted average common shares outstanding            10,172      10,191
                                                    ========    ========

</TABLE>



The accompanying notes are an integral part of these financial statements.





                                        6

<PAGE>   7


                    COMPDENT CORPORATION AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                          SIX MONTHS ENDED
                                                                               JUNE 30,
                                                                          1997         1996
                                                                          ----         ----
                                                                      (UNAUDITED)  (UNAUDITED)
<S>                                                                     <C>         <C>    
Cash flows from operating activities:
     Net Income                                                         $  5,723    $  4,644
     Adjustments to reconcile net income to net cash provided by
       operating activities:
         Depreciation and amortization                                     2,731       2,374
         Gain on sale of property and equipment                              (10)       (309)
         Deferred income tax expense                                       1,281         327
         Changes in assets and liabilities:
             Premiums receivable from subscribers                         (1,178)        586
             Income taxes receivable/payable                               1,156      (1,126)
             Other assets                                                 (1,707)        382
             Unearned revenue                                               (144)        814
             Accounts payable and accrued expenses                        (1,723)       (538)
             Other liabilities                                            (1,191)     (2,584)
                                                                        --------    --------
                Net cash provided by operating activities                  4,938       4,570
                                                                        --------    --------

Cash flows from investing activities:
     Additions to property and equipment                                  (1,331)       (609)
     Increase in restricted cash                                            (107)       (600)
     Proceeds from sale of property and equipment                             18         911
     Cash surrender value of life insurance                                   (3)         35
     Payments made in connection with proposed business acquisitions        (191)
     Purchase of businesses, net of cash acquired                           (473)    (62,468)
                                                                        --------    --------
                Net cash used in investing activities                     (2,087)    (62,731)
                                                                        --------    --------

Cash flows from financing activities:
     Proceeds under credit agreement                                      13,337      44,000
     Tax benefit realized from exercise of nonqualified stock options        583
     Loan fees paid                                                                     (113)
     Payments made in connection with proposed public offering                           (87)
     Proceeds from exercise of stock options                                              55
                                                                        --------    --------
                Net cash provided by financing activities                 13,920      43,855
                                                                        --------    --------

Increase (decrease) in cash and cash equivalents                          16,771     (14,306)
Cash and cash equivalents, beginning of period                            26,959      40,388
                                                                        --------    --------
Cash and cash equivalents, end of period                                $ 43,730    $ 26,082
                                                                        ========    ========

Supplemental disclosures of cash flow information:
     Cash paid during the period for:
         Interest                                                       $  1,198    $    126
                                                                        ========    ========
         Income taxes                                                   $  1,484    $  4,412
                                                                        ========    ========
 Non-cash investing and financing activities:
     Stock issued in exchange for business acquired                     $  1,141    $      0
                                                                        ========    ========
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                        7
<PAGE>   8



                    COMPDENT CORPORATION AND SUBSIDIARIES
             NOTES TO CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                                JUNE 30, 1997

1.  BASIS OF PRESENTATION

     The unaudited consolidated balance sheet as of June 30, 1997, the unaudited
consolidated statements of operations for the three months and six months ended
June 30, 1997 and 1996, and the consolidated statements of cash flows for the
six months ended June 30, 1997 and 1996, in the opinion of management, have been
prepared on the same basis as the audited consolidated financial statements and
include all significant adjustments, consisting of normal recurring adjustments,
necessary for the fair presentation of the results of the interim periods. The
data disclosed in these notes to the financial statements for these periods are
also unaudited. The consolidated financial statements and notes thereto should
be read in conjunction with the consolidated financial statements and notes
thereto as of December 31, 1996 and 1995, and for the years ended December 31,
1996, 1995, and 1994 included in the 1996 Annual Report of CompDent Corporation
and its subsidiaries, (the "Company", except as the context otherwise requires)
on Form 10-K. Operating results of the Company for the six months or three
months ended June 30, 1997 are not necessarily indicative of the results that
may be expected for the entire year ending December 31, 1997.

2.  BUSINESS COMBINATIONS

     Effective January 8, 1996, the Company completed the acquisition of Texas
Dental Plans, Inc., a Texas-based referral fee-for-service dental company, and
affiliated entities ("Texas Dental"), for an aggregate cash purchase price of
approximately $23.0 million. The acquisition was funded with net proceeds
remaining from the Company's second stock offering. The Texas Dental acquisition
was accounted for using the purchase method of accounting, with the results of
operations of the businesses acquired included from the effective date of the
acquisition. The acquisition resulted in excess of cost over fair value of net
assets acquired of $26.0 million which is being amortized over 40 years.

     The following is a summary of assets acquired, liabilities assumed, and
consideration paid in connection with the acquisition:
<TABLE>
<S>                                                   <C>    
Fair value of assets acquired                         $ 27,239,000
Cash paid for assets acquired, net of cash acquired    (23,132,000)
Acquisition costs paid                                    (540,000)
                                                      ------------
Liabilities assumed                                   $  3,567,000
                                                      ============
</TABLE>

     Effective May 8, 1996, the Company acquired all of the outstanding capital
stock and options of Dental Care Plus Management, Corp. ("Dental Care"). The
aggregate purchase price for Dental Care and its wholly-owned subsidiary, IHCS,
Inc. ("IHCS") was $38 million, of which the Company paid approximately $27
million in cash and assumed approximately $11 million in accrued liabilities.
Dental Care and its subsidiary IHCS are based in Chicago, Illinois and provide
managed dental care services through a network of dental care providers. Dental
Care also acts as a third party administrator and provides management services
to Health Care Systems, Inc., a non-profit dental company. The Company financed
the purchase of Dental Care as well as satisfaction of the assumed liabilities
by drawing down the Company's revolving credit facility. The acquisition of
Dental Care was accounted for using the purchase method of accounting with the
results of operations of the businesses acquired included from the effective
date of the acquisition. The acquisition resulted in excess cost over fair value
of net assets acquired of $39.7 million which is being amortized over 40 years.
In 1996, the Company finalized its allocation of the purchase price of Dental
Care which resulted in an increase to excess of purchase price over net assets
acquired of $1.5 million to $41.2 million.


                                       8
<PAGE>   9

     The following is a summary of assets acquired, liabilities assumed, and
consideration paid in connection with the acquisition:

<TABLE>
<S>                                                    <C>    

Fair value of assets acquired                          $ 46,770,000
Cash paid for assets acquired,  net of cash acquired    (26,836,000)
Acquisition costs paid                                     (843,000)
                                                       ------------
Liabilities assumed                                    $ 19,091,000
                                                       ============
</TABLE>

     Effective March 21, 1997, the Company completed the acquisition of American
Dental Providers, Inc. ("AMDP"), and Diamond Dental & Vision, Inc. ("DDV"). The
aggregate purchase price of $1.7 million consisted of $519,030 in cash and
$1,140,998 of Company common stock issued at fair market value. AMDP provides
managed dental care services through a network of dental care providers, and DDV
provides a vision plan and referral fee-for-service dental plan to the Arkansas
market. The Company funded the cash portion of the purchase with cash available
from operations. The acquisition of AMDP and DDV was accounted for using the
purchase method of accounting with the results of operations of the businesses
acquired included from the effective date of the acquisition. The acquisition
resulted in excess of cost over fair value of net assets acquired of $2.9
million, which will be amortized over 40 years. During the 2nd quarter of 1997,
the Company revised its allocation of the purchase price of AMDP and DDV which
resulted in a decrease to the excess of purchase price over net assets acquired
of $0.5 million to $2.4 million.

     The following is a summary of assets acquired, liabilities assumed, and
consideration paid in connection with the acquisition:
<TABLE>
<S>                                              <C>    
Fair value of assets acquired                    $ 2,236,000
Cash paid and fair value of stock issued
     for assets acquired, net of cash acquired    (1,614,000)
Acquisition costs paid                              (416,000)
                                                 -----------
Liabilities assumed                              $   206,000
                                                 ===========
</TABLE>

     Unaudited pro forma results of operations of the Company for the six months
ended June 30, 1997 and 1996 are included below. Such pro forma presentation has
been prepared assuming that the AMDP and DDV acquisitions had occurred as of
January 1, 1997 and that the AMDP and DDV, Texas Dental, and Dental Care
acquisitions had occurred as of January 1, 1996, respectively.

<TABLE>
<CAPTION>
                           Six Months Ended      Six Months Ended
                             June 30, 1997         June 30, 1996
                           ----------------      ----------------
<S>                           <C>                   <C>   

Revenues (in thousands)       $  76,345             $72,858    
                              =========             =======    
                                                               
Net income (in thousands)     $   5,705             $ 3,472    
                              =========             =======    
                                                               
Net income per common share   $    0.56             $  0.34    
                              =========             =======    
</TABLE>
                                                   
     The pro forma results include the historical accounts of the Company, and
historical accounts of the acquired businesses and pro forma adjustments
including the amortization of the excess purchase price over the fair value of
the net assets acquired, the amortization for the 


                                      9
<PAGE>   10

noncompete agreements, the reduction of revenues for an intercompany management
fee charged by Dental Care to its subsidiary IHCS, the elimination of consulting
costs incurred by Dental Care under various contractual arrangements with
related entities of Dental Care which were terminated upon the Company's
purchase of Dental Care, and the applicable income tax effects of these
adjustments. The pro forma results of operations are not necessarily indicative
of actual results which may have occurred had the operations of the acquired
companies been combined in prior periods.

3. CONTINGENT LIABILITIES
     The Company's wholly-owned subsidiary, American Prepaid Professional
Service, Inc. ("American Prepaid"), and its Florida subsidiary, American Dental
Plan, Inc., are currently defendants to a civil complaint filed by three
participating dentists (one of which has since withdrawn) who have entered into
Participating Dentist Agreements with various subsidiaries of the Company
("Subsidiaries"). The complaint alleges a breach of contract and seeks damages
based on the failure of each Subsidiary to make capitation payments to the
participating dentist for the period of time between when affected subscribers
enroll and the time at which the subscribers select a dentist. For almost three
years, the parties have litigated the procedural issue of whether the suit may
be maintained as a class action. In an order issued July 22, 1996, the trial
court ruled that the case could not proceed as a class action. The plaintiffs
appealed this order denying class certification. In an opinion dated July 11,
1997, the appellate court ruled that the cause is suitable for a class action.
The Company has filed motions asking the appellate court either to reconsider
its ruling or to certify a question that would qualify the case for review by
Florida's highest court. If the appellate court denies the Company's request,
litigation on the merits of the plaintiffs' claim will proceed in the trial
court as a class action.

     The Company believes its interpretation and administration of the
Participating Dentist Agreements are correct and, therefore, is vigorously
defending the suit. While the ultimate outcome of this lawsuit cannot at this
time be predicted with certainty, management does not expect that this matter
will have a material adverse effect on the consolidated financial position, cash
flows or results of operations of the Company.

4. SUBSEQUENT EVENTS
     On July 2, 1997 the Company completed the acquisition of twenty-one dental
facilities from The Workman Management Group, LTD. The dental facilities are
the located in central and southern Illinois. The purchase price consisted of
$15.5 million in cash less aggregate outstanding indebtedness of approximately
$1.2 million. Funding for the acquisition was obtained from cash available from
operations and from the Company's revolving line of credit. Concurrent with the
acquisition, the Company entered into a forty year agreement to manage the
dental practices which are operating in the dental facilities.

     In addition to the acquisition of the dental facilities and the long-term
management contracts, the Company has secured an option to acquire nine other
dental facilities currently under management by the Workman Management Group,
as well as additional dental centers opened or acquired by the Workman
Management Group over the next four years in the states of Illinois, Indiana
and Missouri.

5. RECENTLY ISSUED ACCOUNTING STANDARDS


     The Financial Accounting Standards Board ("the Board") has issued Statement
of Financial Accounting Standards ("SFAS") No. 128, "Earnings per Share." This
statement establishes standards for computing and presenting earnings per share
("EPS") and applies to entities with publicly held common stock or potential
common stock. This Statement simplifies the standards for computing earnings per
share previously found in APB Opinion No. 15, "Earnings Per Share," and makes
them comparable to international EPS standards. It replaces the presentation of
primary EPS with a presentation of basic EPS. It also requires dual presentation
of basic and diluted EPS on the face of the income statement for all entities
with complex capital structures and requires a reconciliation of the numerator
and denominator of the basic EPS computation to the numerator and denominator of
the diluted EPS computation.

     Basic EPS excludes dilution and is computed by dividing income available to
common stockholders by the weighted-average number of common shares outstanding
for the period. Diluted EPS reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or converted
into common stock or resulted in the issuance of common stock that then shared
in the earnings of the entity. Diluted EPS is computed similarly to fully
diluted EPS pursuant to Opinion 15.

     This Statement is effective for financial statements issued for periods
ending after December 15, 1997, including interim periods; earlier application
is not permitted. This Statement requires restatement of all prior-period EPS
data presented. Implementing the requirements of SFAS No. 128 is not anticipated
to have a material impact on the financial position, results of operations,
earnings per share, or cash flows of the Company.

     The Board has issued SFAS No. 130, "Reporting Comprehensive Income" which
establishes standards for reporting and display of comprehensive income and its
components (revenues, expenses, gains, and losses) in the financial statements. 
Comprehensive income is defined as the change in equity of a business
enterprise during a period from transactions and other events and circumstances
from nonowner sources.  It includes all changes in equity during a period
except those resulting from investments by owners and distributions to owners. 
This Statement does not require a specific format for the presentation of
comprehensive income but requires an amount representing total comprehensive
income for the period.  This Statement is effective for fiscal years beginning
after December 15, 1997 with reclassification of earlier periods required.
Other than the additional presentation requirements of this Statement, the
Company does not anticipate a material impact on the financial position,
results of operations, earnings per share or cash flows.

     The Board has issued SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information", which establishes standards for the way
that public business enterprises report information about operating segments 
in annual financial statements and requires selected information about
operating segments in interim financial reports.

     This Statement requires that a public business enterprise report financial
and descriptive information about its reportable operating segments.  Operating
segments are components of an enterprise about which separate financial
information is available that is evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing
performance.  Generally, financial information is required to be reported on
the basis that it is used internally for evaluating segment performance and
deciding how to allocate resources to segments.

     The financial information required includes a measure of segment profit or
loss, certain specific revenue and expense items, segment assets and a
reconciliation of each category to the general financial statements.  The
descriptive information required includes the way that the operating segments
were determined, the products and services provided by the operating segments,
differences between the measurements used in reporting segment information and
those used in the general purpose financial statements, and changes in the
measurement of segment amounts from period to period.

     This Statement is effective for financial statements for periods beginning
after December 15, 1997 with restatement of earlier periods required in the
initial year of application.  This Statement need not be applied to interim
financial statements in the initial year of its application, but comparative
information for interim periods in the initial year of application is to be
reported in financial statements for interim periods in the second year of
application.  The Company is currently determining if these disclosure
requirements will be applicable and, therefore, required in future periods.


         

                                       10




<PAGE>   11


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

RESULTS OF OPERATIONS

     The following discussion should be read in conjunction with the attached
consolidated financial statements and notes thereto, and with the Company's
audited financial statements and notes thereto for the fiscal year ended
December 31, 1996.

Three months ended June 30, 1997 and 1996

     Revenues increased by $3.4 million, or 9.9%, to $38.2 million in the second
quarter of 1997 from $34.8 million in the second quarter of 1996. This increase
was primarily attributable to a net increase of $2.5 million, or 7.4%, in
subscriber premiums to $35.9 million in the second quarter of 1997 from $33.4
million in the second quarter of 1996. The acquisition of Dental Care in May
1996 provided $1.4 million of the increase in subscriber premiums as a result of
three months of its revenues being included in the second quarter of 1997
compared to only two months of its revenues after the acquisition being included
in the second quarter of 1996. The acquisitions of AMPD and DDV in March 1997
accounted for $0.3 million of the increase in subscriber premiums. Internal
growth of the Company's existing subscriber base accounted for the remaining
$0.8 million increase.

     Other revenue increased by $1.0 million, or 70.5%, to $2.3 million in the
second quarter of 1997 from $1.4 million in the second quarter of 1996. Dental
Care third party administrator fees and management fees recorded for three
months in the current quarter compared to two months after the acquisition in
the second quarter of 1996 accounted for $0.5 million of the increase. The
balance of the increase in other revenue was mainly due to revenues associated
with dental practice management following commencement of operations. It is
anticipated that dental practice management revenues will increase in future
quarters to the extent that the Company's newly organized dental practice
management company ("Dental Health Management, Inc.") is successful.

     Dental care providers' fees and claims costs increased $2.0 million, or
10.8%, to $19.9 million in the second quarter of 1997 from $18.0 million in the
second quarter of 1996. Dental care providers' fees represent capitation
payments paid to panel dentists under the Company's managed dental care plans.
Under managed dental care plans, capitation payments to panel dentists are fixed
under the participating dental agreement regardless of the extent of services
provided. Dental claim costs represent amounts payable to dental care providers
under the dental indemnity insurance plans. Dental care providers' fees and
claims costs increased to 55.5% of subscriber premiums in the second quarter of
1997 compared to 53.8% in the second quarter of 1996. This small increase as a
percentage of subscriber premiums was due to a change in product mix toward more
inclusive dental plans which incur higher claims costs, and toward plans which
pay a capitation fee based on the number of family members who have selected a
dentist, rather than a per-subscriber capitation fee. The product mix has also
experienced a decline in referral-fee-for-service plans which incur no
capitation fees.

     Commission expense increased $101,000, or 3.3%, to $3.2 million in the
second quarter of 1997 from $3.1 million in the second quarter of 1996. As a
percentage of subscriber premiums, commissions decreased to 8.9% of subscriber
premiums in the second quarter of 1997 from 9.3% in the second quarter of 1996.
This decrease was caused primarily by the acquisition of Dental Care, which had
commission expense equal to 1.0% of subscriber premiums. Historically, Dental
Care has relied more heavily on its direct sales forces than on independent
agents, resulting in lower commissions as a percentage of revenues compared to
the Company's other subsidiaries.

     General and administrative expenses increased $136,000, or 1.7%, to $8.0
million in the 


                                      11
<PAGE>   12

second quarter of 1997 from $7.8 million in the second quarter of 1996. As a
percentage of revenues, this expense decreased to 20.9% in the second quarter of
1997 from 22.5% in the second quarter of 1996. This decrease as a percentage of
revenues was due to cost savings realized from the consolidation of acquired
operations. Redundant personnel and overhead costs have been reduced relating to
both the Texas Dental acquisition, which took place in January 1996, and the
Dental Care acquisition, which took place in May 1996.

     Depreciation and amortization expense increased $68,000, or 5.3%, to $1.4
million in the second quarter of 1997 from $1.3 million in the second quarter of
1996. Amortization of goodwill increased $106,000 principally due to the
additional goodwill amortization recorded following the Dental Care acquisition
in May 1996 and the AMDP and DDV acquisition in March 1997.

     Interest expense increased $304,000 to $738,000 in the second quarter of
1997 from $434,000 in the second quarter of 1996. Interest expense in the second
quarter of 1997 consists mainly of two months of interest on the $38 million of
borrowings which arose in May 1996 with the acquisition of Dental Care. These
borrowings were outstanding for all three months of second quarter 1997 and the
interest rate was higher in 1997 than in 1996. Any future acquisitions may cause
the Company to incur additional indebtedness under its revolving credit facility
or otherwise.

     In the second quarter of 1997, the Company's effective income tax rate
decreased to 43.0% compared to 44.4% in the second quarter of 1996. The decrease
was achieved, in spite of an increase in nondeductible goodwill amortization, by
improved tax planning resulting in the utilization of net operating loss carry
forwards in certain subsidiaries.

Six months ended June 30, 1997 and 1996

     Revenues increased by $9.9 million, or 14.9%, to $76.0 million in six
months ended June 30, 1997 from $66.1 million in the six months ended June 30,
1996. This increase was primarily attributable to a net increase of $7.3
million, or 11.3%, in subscriber premiums to $71.5 million in the six months
ended June 30, 1997 from $64.2 million in the six months ended June 30, 1996.
The acquisition of Dental Care in May 1996 provided $5.1 million of the increase
in subscriber premiums as a result of six months of its revenues being included
in the six months ended June 30, 1997 compared to only two months of its
revenues after the acquisition being included in the six months ended June 30,
1996. The acquisitions of AMPD and DDV in March 1997 accounted for $0.3 million
of the increase in subscriber premiums. Internal growth of the Company's
existing subscriber base accounted for the remaining $1.9 million increase.

     Other revenue increased by $2.6 million, or 135.4%, to $4.5 million in the
six months ended June 30, 1997 from $1.9 million in the six months ended June
30, 1996. Dental Care third party administrator fees and management fees
recorded for six months in the six months ended June 30, 1997 compared to two
months after the acquisition in the six months ended June 30, 1996 accounted for
$1.9 million of the increase. The balance of the increase in other revenue was
mainly due to revenues associated with dental practice management. It is
anticipated that dental practice management revenues will increase in future
quarters to the extent that the Company's newly organized dental practice
management company ("Dental Health Management, Inc.") is successful.

     Dental care providers' fees and claims costs increased $5.0 million, or
14.5%, to $39.5 million in the six months ended June 30, 1997 from $34.4 million
in the six months ended June 30, 1996. Dental care providers' fees represent
capitation payments paid to panel dentists under the Company's managed dental
care plans. Under managed dental care plans, capitation payments to panel
dentists are fixed under the participating dental agreement regardless of the
extent of services provided. Dental claim costs represent amounts payable to
dental care 


                                     12
<PAGE>   13

providers under the dental indemnity insurance plans. Dental care providers'
fees and claims costs increased to 55.2% of subscriber premiums in the six
months ended June 30, 1997 compared to 53.6% in the six months ended June 30,
1996. This increase as a percentage of subscriber premiums was due to a change
in product mix toward more inclusive dental plans which incur higher claims
costs, and toward plans which pay a capitation fee based on the number of family
members who have selected a dentist, rather than simply a per-subscriber
capitation fee. The product mix has also experienced a decline in
referral-fee-for-service plans which incur no capitation fees. The increase in
dental care providers' fees and claims costs as a percentage of subscriber
premiums was also due in part to the acquisition of Dental Care in May 1996,
which historically incurred capitation expense at 62.4% of subscriber premiums
(which is a higher percentage than the Company's other subsidiaries).

     Commission expense increased $260,000, or 4.3%, to $6.4 million in the six
months ended June 30, 1997 from $6.1 million in the six months ended June 30,
1996. As a percentage of subscriber premiums, commissions decreased to 8.9% of
subscriber premiums in the six months ended June 30, 1997 from 9.5% in the six
months ended June 30, 1996. This decrease was caused primarily by the
acquisition of Dental Care, which had commission expense equal to 1.0% of
subscriber premiums. Historically, Dental Care has relied more heavily on its
direct sales forces than on independent agents, resulting in lower commissions
as a percentage of revenues compared to the Company's other subsidiaries.

     General and administrative expenses increased $1.2 million, or 8.4%, to
$15.8 million in the six months ended June 30, 1997 from $14.6 million in the
six months ended June 30, 1996. As a percentage of revenues, this expense
decreased to 20.8% in the six months ended June 30, 1997 from 22.1% in the six
months ended June 30, 1996. This decrease as a percentage of revenues was due to
cost savings realized from the consolidation of acquired operations. Redundant
personnel and overhead costs have been reduced relating to both the Texas Dental
acquisition, which took place in January 1996, and the Dental Care acquisition,
which took place in May 1996.

     Depreciation and amortization expense increased $342,000, or 14.7%, to $2.7
million in the six months ended June 30, 1997 from $2.3 million in the six
months ended June 30, 1996. Amortization of goodwill increased $366,000
principally due to the additional goodwill amortization recorded following the
Dental Care acquisition in May 1996 and the AMDP and DDV acquisitions in March
1997.

     Interest expense increased $966,000 to $1.4 million in the six months ended
June 30, 1997 from $480,000 in the six months ended June 30, 1996. Interest
expense in the six months ended June 30, 1997 consisted mainly of two months of
interest on the $38 million of borrowings which arose in May 1996 with the
acquisition of Dental Care. These borrowings were outstanding for all of the six
months ended June 30, 1997 and the interest rate was higher in 1997 than in
1996. Any future acquisitions may cause the Company to incur additional
indebtedness under its revolving credit facility or otherwise.

     In the six months ended June 30, 1997, the Company's effective income tax
rate was 44.0% compared to 43.8% in the six months ending June 30, 1996. This
change resulted from an increase in nondeductible goodwill amortization mostly
offset by improved tax planning resulting in the utilization of net operating
loss carry forwards in certain subsidiaries.

                                    13
<PAGE>   14


LIQUIDITY AND CAPITAL RESOURCES

     The Company's primary sources of cash in the six months ended June 30, 1997
were $13.3 million of proceeds under the Company's revolving credit agreement
and $4.9 million of cash provided by operating activities. The primary uses of
cash for the period were purchases of property and equipment, and the
acquisitions of AMDP and DDV.

     Cash flows from operating activities were $4.9 million and $4.6 million for
the six months ended June 30, 1997 and 1996, respectively. Cash flows from
operations consist primarily of subscriber premiums and investment income net of
capitation payments to panel dentists, claims paid, brokers' and agents'
commissions, general and administrative expenses, and income tax payments. The
Company receives premium payments in advance of anticipated capitation payments
and claims and invests cash balances in excess of current needs in
interest-bearing accounts.

     Cash used in investing activities was $2.1 million and $62.7 million for
the six months ended June 30, 1997 and 1996, respectively. The decrease in cash
used during the six months ended June 30, 1997 relates primarily to decreased
use of cash for acquisitions. In the six months ended June 30, 1997, $0.5
million was used for the acquisition of AMDP and DDV, compared to $62.5 million
used to acquire Texas Dental and Dental Care in the six months ended June 30,
1996. Capital expenditures increased $0.7 million during the six months ended
June 30, 1997 compared to the six months ended June 30, 1996 due primarily to
purchases of leasehold improvements and dental equipment for the Company's
dental office management business, and telephone and computer purchases. It is
anticipated that capital expenditures will continue an upward trend to the
extent that the Company's dental office management business is successful,
resulting in the opening of new dental offices.

     Cash flows used in financing activities in the six months ended June 30,
1997 were $13.9 million, representing $13.3 million of net proceeds under the
Company's revolving line of credit and a $0.6 million income tax benefit
realized from the exercise of nonqualified stock options. In the six months
ended June 30, 1996, financing activities provided $43.9 million of cash flow,
consisting almost entirely of borrowings under the Company's revolving line of
credit.

     On June 30, 1995, the Company obtained a reducing revolving $35 million
line of credit (the "Credit Facility") from banks. The Credit Facility was
subsequently amended to increase the available line of credit to $65 million.
The Credit Facility as amended requires, beginning at the end of three and
one-half years from the date of closing, a 33% reduction per year in available
and outstanding borrowings. Outstanding indebtedness under the Credit Facility
bears interest, at the Company's option, at a rate equal to the prime rate plus
up to 1/4% or LIBOR plus up to 1 3/4%, with the margin over the prime rate and
LIBOR decreasing as the ratio of consolidated debt to EBITDA decreases.
Currently, borrowings under the Credit Facility bear interest at the LIBOR-based
rate. The Credit Facility prohibits payment of dividends and other distributions
and restricts or prohibits the Company from making certain acquisitions,
incurring indebtedness, incurring liens, disposing of assets or making
investments, and requires it to maintain certain financial ratios on an ongoing
basis. The Credit Facility is collateralized by pledges of the stock of the
Company's direct and indirect subsidiaries. The Company had $55.0 million of
borrowings outstanding as of June 30, 1997 under the Credit Facility.

     The Company believes that cash flow generated by operations will be
sufficient to fund its normal working capital needs and capital expenditures for
at least the next twenty-four months because cash receipts are principally
premium revenue received prior to expected capitation payments and claims for
dental services. Historically, the Company's operations have not been capital
intensive; however, the Company's recent initiative in the establishment of
dental offices through its subsidiary operation, Dental Health Management, Inc.,
will present capital needs, the extent of which is indeterminate. Additional
financing, under the Credit Facility or otherwise, would be required in
connection with any acquisitions which the Company may consummate in the future.

     Under applicable insurance laws of most states in which the Company
conducts business, the Company's subsidiaries operating in the particular states
are required to maintain a minimum level of net worth and reserves. The Company
may be required from time to time to invest funds in one or more of its
subsidiaries to meet regulatory capital requirements. Applicable laws generally
limit the ability of the Company's subsidiaries to pay dividends to the extent
that required regulatory capital would be impaired, and dividend payments are
further restricted under the Credit Facility.

RECENTLY ISSUED ACCOUNTING STANDARDS

     The Financial Accounting Standards Board ("the Board") has issued Statement
of Financial Accounting Standards ("SFAS") No. 128, "Earnings per Share." This
statement establishes standards for computing and presenting earnings per share
("EPS") and applies to entities with publicly held common stock or potential
common stock. This Statement simplifies the standards for computing earnings per
share previously found in APB Opinion No. 15, "Earnings Per Share," and makes
them comparable to international EPS standards. It replaces the presentation of
primary EPS with a presentation of basic EPS. It also requires dual presentation
of basic and diluted EPS on the face of the income statement for all entities
with complex capital structures and requires a reconciliation of the numerator
and denominator of the basic EPS computation to the numerator and denominator of
the diluted EPS computation.

     Basic EPS excludes dilution and is computed by dividing income available to
common stockholders by the weighted-average number of common shares outstanding
for the period. Diluted EPS reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or converted
into common stock or resulted in the issuance of common stock that then shared
in the earnings of the entity. Diluted EPS is computed similarly to fully
diluted EPS pursuant to Opinion 15.

     This Statement is effective for financial statements issued for periods
ending after December 15, 1997, including interim periods; earlier application
is not permitted. This Statement requires restatement of all prior-period EPS
data presented. Implementing the requirements of SFAS No. 128 is not anticipated
to have a material impact on the financial position, results of operations,
earnings per share, or cash flows of the Company.

     The Board has issued SFAS No. 130, "Reporting Comprehensive Income" which
establishes standards for reporting and display of comprehensive income and its
components (revenues, expenses, gains, and losses) in the financial statements. 
Comprehensive income is defined as the change in equity of a business
enterprise during a period from transactions and other events and circumstances
from nonowner sources.  It includes all changes in equity during a period
except those resulting from investments by owners and distributions to owners. 
This Statement does not require a specific format for the presentation of
comprehensive income but requires an amount representing total comprehensive
income for the period.  This Statement is effective for fiscal years beginning
after December 15, 1997 with reclassification of earlier periods required.
Other than the additional presentation requirements of this Statement, the
Company does not anticipate a material impact on the financial position,
results of operations, earnings per share or cash flows.

     The Board has issued SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information", which establishes standards for the way
that public business enterprises report information about operating segments 
in annual financial statements and requires selected information about
operating segments in interim financial reports.

     This Statement requires that a public business enterprise report financial
and descriptive information about its reportable operating segments.  Operating
segments are components of an enterprise about which separate financial
information is available that is evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing
performance.  Generally, financial information is required to be reported on
the basis that it is used internally for evaluating segment performance and
deciding how to allocate resources to segments.

     The financial information required includes a measure of segment profit or
loss, certain specific revenue and expense items, segment assets and a
reconciliation of each category to the general financial statements.  The
descriptive information required includes the way that the operating segments
were determined, the products and services provided by the operating segments,
differences between the measurements used in reporting segment information and
those used in the general purpose financial statements, and changes in the
measurement of segment amounts from period to period.

     This Statement is effective for financial statements for periods beginning
after December 15, 1997 with restatement of earlier periods required in the
initial year of application.  This Statement need not be applied to interim
financial statements in the initial year of its application, but comparative
information for interim periods in the initial year of application is to be
reported in financial statements for interim periods in the second year of
application.  The Company is currently determining if these disclosure
requirements will be applicable and, therefore, required in future periods.


         








                                      14
<PAGE>   15




                         PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     The Company's wholly-owned subsidiary, American Prepaid professional
Service, Inc. ("American Prepaid"), and its Florida subsidiary, American Dental
Plan, Inc., are currently defendants to a civil complaint filed by three
participating dentists (one of which has since withdrawn) who have entered into
Participating Dentist Agreements with various subsidiaries of the Company
("Subsidiaries"). The complaint alleges a breach of contract and seeks damages
based on the failure of each Subsidiary to make capitation payments to the
participating dentist for the period of time between when affected subscribers
enroll and the time at which the subscribers select a dentist. For almost three
years, the parties have litigated the procedural issue of whether the suit may
be maintained as a class action.  In an order issued July 22, 1996, the trial
court ruled that the case could not proceed as a class action.  The plaintiffs
appealed this order denying class certification.  In an opinion dated July 11,
1997 the appellate court ruled that the cause is suitable for a class action. 
The Company has filed motions asking the Appellate court either to reconsider
its ruling or to certify a question that would qualify the case for review by
Florida's highest court.  If the appellate court denies the Company's request,
litigation on the merits of the Plaintiffs' claim will proceed in the trial
court as a class action.

     The Company believes its interpretation and administration of the
Participating Dentist Agreements are correct and, therefore, is vigorously
defending the suit.  While the ultimate outcome of this lawsuit cannot at this
time be predicted with certainty, management does not expect that this matter
will have a material adverse effect on the consolidated financial position,
cash flows or results of operations of the Company.

     The Company is not a party to any other material legal proceeding.

ITEM 2.  CHANGES IN SECURITIES

On April 30, 1997, the Board adopted a 1997 Stock Option Plan (the "1997
Plan"). A total of 500,000 shares of Common Stock have been reserved for
issuance under the 1997 Plan.  Following the adoption of the 1997 Plan, the
Option Committee granted an aggregate of 320,000 non-qualified stock options to
senior officers of the Company.  Of these grants, 80,000 were issued at an
exercise price of $16.12 (the closing price reported on April 30, 1997, on the
Nasdaq National Market System), 80,000 at an exercise price of $19.35, 80,000
at the exercise price of $23.27, and 80,000 at an exercise price of $27.86. 
These options were granted in reliance upon the exemption from registration
under the Securities Act stated in the interpretive position of the staff of
the Division of Corporate Finance of the Securities and Exchange Commission
(the "Staff") contained in the January 1997 edition of the Staff's Manual of
Publicly-Available Telephone Interpretations to the effect that shares
underlying options are permitted to be registered on Form S-8 at any time
before the option is exercised, without regard to when the option became
exercisable.  See Exhibits 10.1, 10.3 and 10.4 

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Company's annual meeting of Shareholders was held on April 30, 1997.  A
total of 6,651,132 shares were represented by proxy at the meeting,
representing 66.1% of the 10,064,393 shares eligible to vote.  Philip Hertik
and David F. Scott were re-elected to the Board of Directors as Class II
Directors.  With respect to Mr. Hertik, 6,649,632 shares of Common Stock were
voted for his election and votes with respect to 1,500 shares were withheld.
With respect to Mr. Scott, 6,649,632 shares of Common Stock were voted for his
elected and votes with respect to 1,500 shares were withheld.

Also at the meeting, the Company's 1996 Stock Option Plan was not approved,
with 2,273,185 shares of Common Stock voting in favor of the Plan, 4,005,253
shares of Common Stock voting against approval of the Plan, and 6,187 shares of
Common Stock abstaining.

ITEM 5. OTHER INFORMATION

The Company has entered into a five-year Employment Agreement with Phil Hertik,
President of Dental Health Management, Inc., a wholly-owned subsidiary of the
Company.  The Agreement generally provides for a continuation of base salary
and continuation of certain benefits for two years following termination of
employment without cause, in the event of a breach by the Company, or upon a
material change in the duties, title, compensation, and/or location of Mr.
Hertik within one year following a change of control of the Company (as
defined). Mr. Hertik is subject to a two-year restriction on competition with
the Company following termination of employment for any reason.  See Exhibit
10.2

ITEM 6.  EXHIBITS AND REPORTS FILED ON FORM 8-K

     (a)  Exhibits.
          10.1   97 Stock Option Plan.
          10.2   Employment Agreement between CompDent Corporation and Mr. Phil
                 Hertik
          10.3   Form of Non-Qualified Stock Option Agreement - immediate 
                 vesting
          10.4   Form of Non-Qualified Stock Option Agreement - gradual vesting
          27     Financial Data Schedule (for SEC use only).

     (b)  Reports on Form 8-K.

             None.


                                     15
<PAGE>   16


                                  SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                   COMPDENT CORPORATION


Date:  August 14, 1997             By: /s/ Bruce Mitchell
                                       ---------------------------------------
                                       Bruce Mitchell
                                       Treasurer and Chief Financial Officer
                                       (Signing as duly authorized officer and
                                       chief financial officer)


                                     16
<PAGE>   17


                                  EXHIBIT INDEX


10.1  1997 Stock Option Plan.                                                18
10.2  Employment Agreement between CompDent Corporation and Mr. Phil Hertik  26
10.3  Form of Non-Qualified Stock Option Agreement - immediate vesting       33
10.4  Form of Non-Qualified Stock Option Agreement - gradual vesting         40
                                                                             
EX-27 Financial Data Schedule (for SEC use only).                            51





                                     17