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As filed with the Securities and Exchange Commission on September 16, 1996
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
HEALTH SYSTEMS DESIGN CORPORATION
(Exact name of issuer as specified in its charter)
Delaware 94-3235734
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1330 Broadway, Oakland, CA 94612
(Address of Principal Executive Offices)
HEALTH SYSTEMS DESIGN CORPORATION
NONEMPLOYEE DIRECTOR STOCK PLAN
(Full Title of the Plans)
Richard C. Auger
Chief Executive Officer
Health Systems Design Corporation
1330 Broadway
Oakland, CA 94612
(510) 763-2629
(Name, address and telephone number of agent for service)
Copies to:
John F. Seegal, Esq.
Orrick, Herrington & Sutcliffe
400 Sansome Street
San Francisco, CA 94111
CALCULATION OF REGISTRATION FEE
============================================================================
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share* Price* Fee*
- ----------------------------------------------------------------------------
Common Stock, 60,000 shares $ 10.3125 $ 618,750 $ 214.00
and Options to
Purchase Common
Stock
============================================================================
* Estimated solely for the purpose of calculating the registration fee on the
basis of $10.3125 per share, the average of the high and low prices for the
Common Stock on September 10, 1996 as reported by NASDAQ.
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INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are incorporated by reference in this registration
statement: (i) the latest prospectus (dated March 5, 1996) of Health Systems
Design Corporation (the "Company") filed pursuant to the Securities Act of
1933, as amended; (ii) all reports filed by the Company pursuant to Sections
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") since the date of such prospectus; and (iii) the
description of the Company's common stock set forth in the Company's
Registration Statement on Form 8-A relating thereto, including any amendment
or report filed for the purpose of updating such description. All documents
filed by the Company after the date of this registration statement pursuant
to Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment (that indicates all securities offered
have been sold or deregisters all securities then remaining unsold), shall be
deemed to be incorporated by reference in this registration statement and to
be a part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Inapplicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Inapplicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article Sixth, Section 2 of the Company's Certificate of Incorporation provides
that directors of the Company shall not be personally liable to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a
director, to the fullest extent permitted by the General Corporation Law of the
State of Delaware. Article Five, Section 1 of the Company's By-Laws provides
for indemnification of officers and directors to the full extent and in the
manner permitted by Delaware law. Section 145 of the Delaware General
Corporation Law makes provision for such indemnification in terms sufficiently
broad to cover officers and directors under certain circumstances for
liabilities arising under the Securities Act of 1933, as amended.
The Company has entered into indemnification agreements with each director which
provide indemnification under certain circumstances for acts and omissions which
may not be covered by any directors' and officers' liability insurance.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Inapplicable.
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ITEM 8. EXHIBITS
4.1 Health Systems Design Corporation Nonemployee Director Stock Option Plan.
4.2 Form of Non-Qualified Stock Option Agreement.
5.1 Opinion of Orrick, Herrington & Sutcliffe LLP.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Orrick, Herrington & Sutcliffe LLP is contained in Exhibit 5.1
to this Registration Statement.
ITEM 9. 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 the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3 or Form S-8 and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
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(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
registrant'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 the
Plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(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 foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
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Signatures
THE REGISTRANT
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-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Oakland, State of California on the 28th day of
August, 1996.
HEALTH SYSTEMS DESIGN CORPORATION
(Registrant)
/s/ Richard C. Auger
- ---------------------------------
Richard C. Auger
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
Signature Title Date
Principal Executive Officer:
/s/ Richard C. Auger
- ----------------------------
Richard C. Auger President and August 28, 1996
Chief Executive
Officer
Principal Financial Officer
and Accounting Officer:
/s/ Richard E. Malone
- ----------------------------
Richard E. Malone Vice President, August 30, 1996
Finance and Chief
Financial Officer
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Directors:
/s/ Richard C. Auger
- ----------------------------
Richard C. Auger Director August 28, 1996
/s/ Catherine C. Roth
- ----------------------------
Catherine C. Roth Director August 28, 1996
/s/ J. Matthew Mackowski
- ----------------------------
J. Matthew Mackowski Director September 5, 1996
- ----------------------------
Arthur M. Southam Director , 1996
A majority of the members of the Board of Directors.
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EXHIBIT INDEX
4.1 Health Systems Design Corporation Nonemployee Director Stock Option Plan.
4.2 Form of Non-Qualified Stock Option Agreement.
5.1 Opinion of Orrick, Herrington & Sutcliffe LLP.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Orrick, Herrington & Sutcliffe LLP is contained in Exhibit 5.1
to this Registration Statement.
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EXHIBIT 4.1
HEALTH SYSTEMS DESIGN CORPORATION
NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
(Effective May 15, 1996)
SECTION 1
ESTABLISHMENT, PURPOSE AND DURATION
1.1 Establishment. Health Systems Design Corporation, a Delaware
corporation (the "Company"), hereby establishes the "Health Systems Design
Corporation Nonemployee Director Stock Option Plan" (the "Plan"), for the
benefit of certain nonemployee members of the Board of Directors of the
Company ("Nonemployee Directors"), in order to compensate such Nonemployee
Directors for their past services by awarding them stock options under the
Plan ("Options").
1.2 Purpose of the Plan. The purpose of the Plan is to promote the
success, and enhance the value, of the Company, by attracting, retaining and
motivating Nonemployee Directors of outstanding competence. The Plan also is
designed to align the interests of Nonemployee Directors with the interests of
the stockholders of the Company.
1.3 Effective Date. The Plan is effective as of May 15, 1996,
subject to the approval by an affirmative vote, at the next meeting of the
stockholders of the Company, or any adjournment thereof, of the holders of a
majority of the outstanding shares of the common stock of the Company
("Shares"), present in person or by proxy and entitled to vote at such
meeting. As provided in the Plan, Options will be granted prior to the
receipt of such vote, but such grants shall be null and void if such vote is
not in fact received.
1.4 Duration of the Plan. The Plan shall commence on the date
specified in Section 1.3, and subject to the right of the Board of Directors of
the Company to terminate the Plan at any time and for any reason pursuant to
Section 7, shall remain in effect until May 14, 1999. Notwithstanding the
preceding sentence, each Option shall remain in effect until such Option has
been satisfied by the issuance of Shares or terminated in accordance with its
terms and the terms of the Plan. In the event that on any date of grant the
number of Shares to be subject to Options granted to all Nonemployee Directors
exceeds the number of Shares then available for grant under the Plan, each
Nonemployee Director shall share pro rata in the number of Shares that remain
available for grant on such date.
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SECTION 2
DEFINITIONS
For purposes of this Plan, the following terms shall have the meanings
indicated unless a different meaning is plainly required by the context:
2.1 "Board" or "Board of Directors" means the Board of Directors
of the Company.
2.2 "Code" means the Internal Revenue Code of 1986, as amended.
Reference to a specific section of the Code shall include such section, any
valid regulation promulgated thereunder, and any comparable provision of any
future legislation amending, supplementing or superseding such section.
2.3 "Company" means Health Systems Design Corporation, a Delaware
corporation, or any successor thereto.
2.4 "Director" means an individual who is a member of the Board.
2.5 "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor Act thereto. Reference to a
specific section of the Exchange Act shall include such section, any valid
regulation promulgated thereunder, and any comparable provision of any future
legislation amending, supplementing or superseding such section.
2.6 "Exercise Price" means the price at which a Share may be
purchased pursuant to an Option.
2.7 "Fair Market Value" means the average of the highest and lowest
quoted selling prices for Shares on the relevant date, or if there were no sales
on such date, the weighted average of the means between the highest and lowest
quoted selling prices on the nearest day before and the nearest day after the
relevant date, as determined by the Board of Directors.
2.8 "Nonemployee Director" means a Director who is an employee of
neither the Company nor of any Subsidiary. Notwithstanding the preceding
sentence, J. Matthew Mackowski shall not be considered a Nonemployee Director
for purposes of this Plan.
2.9 "Option" means an option to purchase Shares which has been
granted under the provisions of the Plan. Options are not intended to be
incentive stock options under section 422 of the Code.
2.10 "Participant" means a Nonemployee Director to whom an Option
has been granted under the provisions of the Plan.
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2.11 "Plan" means the Health Systems Design Corporation Nonemployee
Director Stock Option Plan, as set forth in this instrument and as hereafter
amended from time to time.
2.12 "Shares" means the shares of common stock of the Company.
2.13 "Subsidiary" means any corporation in which the Company owns
directly, or indirectly through subsidiaries, at least fifty percent (50%) of
the total combined voting power of all classes of stock, or any other entity
(including, but not limited to, partnerships and joint ventures) in which the
Company owns at least fifty percent (50%) of the combined equity thereof.
SECTION 3
ADMINISTRATION OF THE PLAN
3.1 The Board of Directors. The Plan shall be administered by the
Board of Directors. It shall be the duty of the Board of Directors to conduct
the general administration of the Plan in accordance with its provisions.
3.2 Authority of the Board of Directors. The Board of Directors
shall have all powers and discretion necessary or appropriate to administer the
Plan and to control its operation in accordance with its terms, including, but
not limited to, the following powers:
(a) To interpret the provisions of the Plan and to determine, in its
sole discretion, any question arising under, or in connection with the
administration or operation of, the Plan;
(b) To employ such counsel, agents and advisers, and to obtain such
legal, clerical and other services, as it may deem necessary or appropriate
in carrying out the provisions of the Plan; and
(c) To prescribe, amend and rescind rules and regulations relating to
the Plan, and to make all other determinations which may be necessary or
advisable for the administration of the Plan.
3.3 Decisions Binding. All actions, interpretations and decisions of
the Board of Directors shall be final, conclusive and binding on all persons,
and shall be given the maximum deference permitted by law.
3.4 Administrative Expenses. All expenses incurred in the
administration of the Plan by the Board of Directors, or otherwise, including
legal fees and expenses, shall be paid and borne by the Company.
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3.5 Indemnification. Each person who is or shall have been a member
of the Board shall be indemnified and held harmless by the Company against and
from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by him or her in connection with or resulting from any
claim, notion, suit, or proceeding to which he or she may be a party or in which
he or she may be involved by reason of any action taken or failure to act under
the Plan and against and from any and all amounts paid by him or her in
settlement thereof, with the Company's approval, or paid by him or her in
satisfaction of any judgment in any such action, suit, or proceeding against him
or her, provided he or she shall give the Company an opportunity, at its own
expense, to handle and defend the same before he or she undertakes to handle and
defend it on his or her own behalf. The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which such
persons may be entitled under the Company's Certificate of Incorporation or
Bylaws, as a matter of law, or otherwise, or any power that the Company may have
to indemnify them or hold them harmless.
SECTION 4
SHARES SUBJECT TO THE PLAN
4.1 Number of Shares. Subject to adjustment as provided in Section
4.3, the maximum number of Shares available for grant under the Plan may not
exceed 60,000. Such Shares may be either authorized but unissued Shares or
treasury Shares.
4.2 Effect of Lapsed Options. If an Option is cancelled, terminates,
expires or lapses for any reason, any Shares subject to such Option again shall
be made available for grant under the Plan (to the same Participant or to a
different person).
4.3 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination, or other change in the corporate
structure of the Company affecting the Shares, such adjustment shall be made in
the number and class of Shares which may be delivered under the Plan, and in the
number and class of and/or the Exercise Price of Shares subject to outstanding
Options, as may be determined to be appropriate and equitable by the Board, in
its sole discretion, to prevent the dilution or diminishment of Options.
Notwithstanding the preceding sentence, the number of Shares subject to any
Option always shall be a whole number.
SECTION 5
ELIGIBILITY
5.1 Eligibility. All Nonemployee Directors shall be eligible to
participate in the Plan.
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5.2 Consideration for Grant of Option. Any Option under the Plan
shall be granted in consideration of the past services of the Participant.
SECTION 6
OPTIONS
6.1 Grant of Options.
6.1.1 Initial Grants. Each Nonemployee Director automatically
will receive on the date he or she is initially appointed by the Board of
Directors to serve as a member thereof an Option to purchase 5,000 Shares.
6.1.2 Ongoing Grants. Each Participant who has been granted an
Option to purchase 5,000 Shares pursuant to Section 6.1.1, automatically will
receive, on the date of each subsequent annual meeting of the stockholders of
the Company, an Option to purchase an additional 5,000 Shares, provided that the
Participant is a Nonemployee Director on each such date of grant.
6.2 Terms of Options.
6.2.1 Option Agreement. Each Option shall be evidenced by a
written stock option agreement which shall be executed by the Participant and
the Company.
6.2.2 Exercise Price. The Exercise Price for the Shares
subject to each Option shall be one hundred percent (100%) of the Fair Market
Value of such Shares on the date of grant.
6.2.3 Exercisability of Options. Each Option shall become
exercisable in full on the first anniversary of the date of grant of the Option.
6.2.4 Expiration of Options. Each Option shall terminate upon
the earlier of (a) the expiration of six (6) years from the date of grant of the
Option, or (b) the expiration of nine (9) months from the date of the
Participant's termination of service as a Director for any reason.
Notwithstanding the preceding sentence, if a Participant ceases to be a Director
prior to the date that an Option held by him or her has become exercisable
pursuant to Section 6.2.3, such Option shall terminate on the date of the
Participant's cessation of service as a Director.
6.2.5 Payment. Options shall be exercised by the Participant's
delivery of a written notice of exercise to the Secretary of the Company,
setting forth the number of Shares with respect to which the Option is to be
exercised, accompanied by full payment for the Shares. The Exercise Price for
any such
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Shares shall be payable to the Company in full in cash or its equivalent.
As soon as practicable after receipt of a written notification of
exercise and full payment for the Shares purchased, the Company shall deliver to
the Participant Share certificates (in the Participant's name) representing such
Shares.
6.2.6 Restrictions on Share Transferability. The Board of
Directors may impose such restrictions on any Shares acquired pursuant to the
exercise of an Option, as it may deem advisable, including, but not limited to,
restrictions under applicable Federal securities laws, under the requirements of
any national securities exchange or system upon which Shares are then listed
and/or traded, and/or under any blue sky or state securities laws applicable to
such Shares.
6.2.7 Nontransferability of Options. No Option granted under
the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will, the laws of descent and distribution, or as
permitted in Section 7.2. All Options granted to a Participant under the Plan
shall be exercisable during his or her lifetime only by such Participant.
SECTION 7
Miscellaneous
7.1 Amendment or Termination of the Plan. The Board, in its sole
discretion, may amend, alter, modify or terminate the Plan, in whole or in part,
at any time and for any reason. However, only if and to the extent required to
maintain the Plan's qualification under Rule 16b-3 promulgated under the
Exchange Act, any such amendment shall be subject to stockholder approval. In
addition, as required by Rule 16b-3, the provisions regarding the formula for
determining the amount and timing of Options shall in no event be amended more
than once every six (6) months, other than to comport with changes in the Code
and/or the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). (ERISA is inapplicable to the Plan.) Neither the amendment,
suspension, termination, nor scheduled expiration of the Plan shall, without the
consent of the Participant, alter or impair any rights or obligations under any
Option theretofore granted. No Option may be granted during any period of
suspension nor after termination of the Plan.
7.2 Beneficiary Designation. If permitted by the Board of Directors,
a Participant may name a beneficiary or beneficiaries to whom any benefit under
the Plan is to be paid in case of the Participant's death before he or she
receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Participant and must be in a form and manner
acceptable to the Board of Directors. In the absence
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of any such designation, or if no beneficiary survives the Participant,
benefits remaining unpaid at the Participant's death shall be paid to the
person or persons entitled to such benefits under the Participant's will or,
if the Participant shall fail to make testamentary disposition of such
benefits, his or her legal representative. Any transferee must furnish the
Company with (a) written notice of his or her status as a transferee, and (b)
evidence satisfactory to the Company to establish the validity of the
transfer and compliance with any laws or regulations pertaining to said
transfer.
7.3 No Effect Upon Other Compensation Plans. The adoption of this
Plan shall not affect any other stock option, compensation or incentive plans in
effect for the Company or any Subsidiary, and this Plan shall not preclude the
Board from establishing any other forms of incentive or compensation for
Nonemployee Directors.
7.4 No Effect on Service. Nothing in the Plan shall interfere with
or limit in any way the right of the Company to terminate any Participant's
service on the Board at any time, with or without cause.
7.5 Requirements of Law. The granting of Options and the issuance of
Shares under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.
7.6 Rule 16b-3 Compliance. Transactions under this Plan are intended
to comply with all applicable conditions of Rule 16b-3 or its successors under
the Exchange Act. To the extent that any provision of the Plan, an Option or
any action by the Board of Directors fails to so comply, it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the Board of
Directors. Notwithstanding any contrary provision of the Plan, if the Board of
Directors specifically determines that compliance with Rule 16b-3 no longer is
required, all references in the Plan to Rule 16b-3 shall be of no force or
effect.
7.7 Captions. The captions contained herein and in the table of
contents are provided as a matter of convenience only, and in no way define,
limit, enlarge or describe the scope or intent of the Plan. Such captions shall
not affect in any way the construction of any provision of the Plan.
7.8 Applicable Law; Severability. The Plan hereby created shall be
construed, administered and governed in all respects in accordance with the laws
of the State of California (with the exception of its conflict of laws
provisions). If any provision of this instrument shall be held invalid or
unenforceable by a court of competent jurisdiction, the remaining provisions
hereof shall continue to be fully effective.
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EXECUTION
IN WITNESS WHEREOF, the Company, by its duly authorized officer, has
executed this Plan on the date indicated below.
HEALTH SYSTEMS DESIGN CORPORATION
Dated: August 29, 1996 By /s/ Richard C. Auger
------------------------------
Title: CEO, Chairman
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EXHIBIT 4.2
HEALTH SYSTEMS DESIGN CORPORATION
NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
1. Grant of Option. Health Systems Design Corporation (the
"Company") hereby grants to ____________________ (the "Director") under the
Health Systems Design Corporation Nonemployee Director Stock Option Plan (the
"Plan"), as a separate incentive in connection with his or her service on the
Board of Directors of the Company and not in lieu of any fees or other
compensation for his or her services, a nonqualified stock option to purchase,
on the terms and conditions set forth in this Agreement and the Plan, all or any
part of an aggregate of 5,000 shares of authorized but unissued or treasury
shares of common stock of the Company ("Shares"), at the purchase price set
forth in paragraph 2 of this Agreement. The option granted hereby is not
intended to be an incentive stock option within the meaning of section 422 of
the Internal Revenue Code of 1986, as amended.
2. Exercise Price. The purchase price per Share for this option
(the "Exercise Price") shall be $_________, which is the Fair Market Value per
Share on _________, the effective date of this Agreement (the "Grant Date").
The Exercise Price shall be payable in the legal tender of the United States.
3. Number of Shares. The number and class of Shares specified in
paragraph 1 of this Agreement, and/or the Exercise Price, are subject to
appropriate adjustment by the Board in the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination or other change in the corporate structure
of the Company affecting the Shares; provided, however, that the number of
Shares subject to this option shall always be a whole number. Subject to any
required action of the stockholders of the Company, if the Company is the
surviving corporation in any merger or consolidation, this option (to the extent
that it is still outstanding) shall pertain to and apply to the securities to
which a holder of the same number of Shares that are then subject to the option
would have been entitled.
4. Commencement of Exercisability. Subject to paragraph 5 of this
Agreement, the right to exercise this option shall accrue as to 100% of the
Shares subject thereto on the first anniversary date of the Grant Date.
5. Termination of Option. This option shall terminate upon the
earlier of (a) the expiration of six (6) years from the Grant Date or (b) the
expiration of nine (9) months from the date of the Director's termination of
service on the Board
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for any reason; provided, however, that if the Director ceases to be a member
of the Board prior to the date that the option has become exercisable, the
option shall terminate on the date of the Director's cessation of service on
the Board.
6. Persons Eligible to Exercise. The option shall be exercisable
during the Director's lifetime only by the Director. This option is not
transferable, except that the Director may transfer this option (a) by a valid
beneficiary designation made in a form and manner acceptable to the Board, or
(b) by will or the applicable laws of descent and distribution.
7. Death of the Director. To the extent exercisable after the
Director's death, this option shall be exercised only by the Director's
designated beneficiary or beneficiaries, or if no beneficiary survives the
Director, by the person or persons entitled to the option under the Director's
will, or if the Director fails to make a testamentary disposition of the option,
his or her legal representative. Any such transferee must furnish the Company
(a) written notice of his or her status as a transferee, (b) evidence
satisfactory to the Company to establish the validity of the transfer of this
option and compliance with any laws or regulations pertaining to such transfer,
and (c) written acceptance of the terms and conditions of this option as set
forth in this Agreement.
8. Exercise of Option. This option may be exercised by the person
then entitled to do so as to any Shares which may then be purchased (a) by
giving written notice of exercise to the Secretary of the Company (or his or her
designee), specifying the number of full Shares to be purchased and accompanied
by full payment of the Exercise Price thereof (and the amount of any income tax
the Company is required by law to withhold by reason of such exercise), and
(b) by giving satisfactory assurances in writing if requested by the Company,
signed by the person exercising the option, that the Shares to be purchased upon
such exercise are being purchased for investment and not with a view to the
distribution thereof.
9. Suspension of Exercisability. If at any time the Company shall
determine, in its discretion, that the listing, registration or qualification of
the Shares upon any securities exchange or under any state or federal law, or
the consent or approval of any governmental regulatory authority, is necessary
or desirable as a condition of the purchase of Shares hereunder, this option may
not be exercised, in whole or in part, unless and until such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Company. The Company
shall make reasonable efforts to meet the requirements of any such state or
federal law or securities exchange and to obtain any such consent or approval of
any such governmental authority.
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10. No Rights of Stockholder. Neither the Director nor any person
claiming under or through the Director shall be or have any of the rights or
privileges of a stockholder of the Company in respect of any of the Shares
issuable pursuant to the exercise of this option, unless and until certificates
representing such Shares shall have been issued, recorded on the records of the
Company or its transfer agents or registrars, and delivered to the Director (or
such other person).
11. No Effect on Service. Nothing in this Agreement or the Plan
shall interfere with or limit in any way the right of the Company to terminate
the Director's service on the Board at any time, with or without cause.
12. Addresses for Notices. Any notice to be given to the Company
under the terms of this Agreement shall be addressed to the Company, in care of
its Secretary, at Health Systems Design Corporation, 1330 Broadway, Oakland, CA
94612, or at such other address as the Company may hereafter designate in
writing. Any notice to be given to the Director shall be addressed to the
Director at the address set forth beneath the Director's signature hereto, or at
such other address as the Director may hereafter designate in writing. Any such
notice shall be deemed to have been duly given if and when enclosed in a
properly sealed envelope, addressed as aforesaid, registered or certified and
deposited, postage and registry fee prepaid, in a United States post office.
13. Option is not Transferable. Except as otherwise provided
herein, this option and the rights and privileges conferred hereby shall not be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) and shall not be subject to sale under execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option, or of any right or privilege
conferred hereby, or upon any attempted sale under any execution, attachment or
similar process, this option and the rights and privileges conferred hereby
immediately shall become null and void.
14. Binding Agreement. Subject to the limitation on the
transferability of this option contained herein, this Agreement shall be binding
upon and inure to the benefit of the heirs, legatees, legal representatives,
successors and assigns of the parties hereto.
15. Plan Governs. This Agreement is subject to all of the terms and
provisions of the Plan. In the event of a conflict between one or more
provisions of this Agreement and one or more provisions of the Plan, the
provisions of the Plan shall govern. Capitalized terms and phrases used and not
defined in this Agreement shall have the meaning set forth in the Plan.
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16. Board Authority. The Board shall have the power to interpret
the Plan and this Agreement and to adopt such rules for the administration,
interpretation and application of the Plan as are consistent therewith. All
actions taken and all interpretations and determinations made by the Board in
such connection shall be final and binding upon the Director, the Company and
all other interested persons, and shall be given the maximum deference permitted
by law. No member of the Board shall be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan or
this Agreement.
17. Captions. The captions provided herein are for convenience only
and are not to serve as a basis for interpretation or construction of this
Agreement.
18. Agreement Severable. In the event that any provision in this
Agreement shall be held invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be construed
to have any effect on, the remaining provisions of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
in duplicate, effective as of the Grant Date.
HEALTH SYSTEMS DESIGN CORPORATION
By ______________________________
Title:
__________________________________
Director Signature
__________________________________
__________________________________
Address
__________________________________
Social Security Number
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EXHIBIT 5.1
September 16, 1996
Health Systems Design Corporation
1330 Broadway
Oakland, CA 94612
Re: Health Systems Design Corporation/
Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
At your request, we are rendering this opinion in connection with
the proposed issuance pursuant to the Health Systems Design Corporation
Nonemployee Director Stock Option Plan (the "Plan"), of up to 60,000 shares
of common stock, $0.001 par value (the "Common Stock"), of Health Systems
Design Corporation, a Delaware corporation (the "Company").
We have examined instruments, documents, and records which we deemed
relevant and necessary for the basis of our opinion hereinafter expressed. In
such examination, we have assumed the following: (a) the authenticity of
original documents and the genuineness of all signatures; (b) the conformity to
the originals of all documents submitted to us as copies; and (c) the truth,
accuracy and completeness of the information, representations and warranties
contained in the records, documents, instruments and certificates we have
reviewed.
Based on such examination, we are of the opinion that the 60,000
shares of Common Stock to be issued by the Company pursuant to the Plan are
validly authorized shares of Common Stock and, when issued in accordance with
the provisions of the Plan, will be legally issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to
this Registration Statement and to the use of our name wherever it appears in
said Registration Statement. In giving such consent, we do not consider that
we are "experts" within the meaning of such term as used in the Securities
Act of 1933, as amended, or the rules and regulations of the Securities and
Exchange Commission issued thereunder, with respect to any part of the
Registration Statement, including this opinion as an exhibit or otherwise.
Very truly yours,
/s/ Orrick, Herrington & Sutcliffe LLP
ORRICK, HERRINGTON & SUTCLIFFE LLP
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EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-8 of our report dated
January 2, 1996 included in Health Systems Design Corporation's prospectus
dated March 5, 1996 for the year ended September 30, 1995 and to all
references to our Firm included in this Registration Statement on Form S-8.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Oakland, California
September 12, 1996
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