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FOR IMMEDIATE RELEASE
OCTOBER 19, 2000
PEROT SYSTEMS TO ACQUIRE HEALTH SYSTEMS DESIGN
PEROT SYSTEMS WILL ADD NEW PRODUCT CAPABILITIES AND EXPAND HEALTHCARE PAYOR
MARKET PRESENCE. HEALTH SYSTEMS DESIGN WILL GAIN FINANCIAL STRENGTH AND BROAD
NEW SERVICE OFFERINGS.
Dallas, TX and Oakland, CA - October 19, 2000 - Perot Systems Corporation (NYSE:
PER) and Health Systems Design Corporation (NASDAQ: HSDC) today announced that
they have entered into a definitive merger agreement whereby Perot Systems will
acquire HSDC for $2 per share in an all cash transaction.
Perot Systems will add HSDC's DIAMOND-Registered Trademark- healthcare payor
enterprise software solutions to its portfolio of payor services. The
comprehensive functionality of the DIAMOND software will provide another
valuable tool for Perot Systems to use in assisting healthcare customers with
innovative technology-based solutions.
HSDC will operate as a subsidiary of Perot Systems, continuing to offer the
leading-edge DIAMOND technology on a turnkey basis to the healthcare payor
market. Additionally, it will be offered as part of Perot Systems' service
offerings in an ASP (Application Service Provider) or outsourcing environment.
"Perot Systems-Registered Trademark- Digital Health Plan-TM- Internet
technology will be integrated with DIAMOND, and our HIPAA (Health Insurance
Portability and Accountability Act) consulting practice will ensure the
ability of current and future DIAMOND clients to meet the demands of HIPAA,"
said Chuck Lyles, director of Perot Systems' healthcare operations. "This
strategic move will complement our existing initiatives and service
offerings, including our work with other enterprise solutions."
"In complex markets, like healthcare finance and administration, the technology,
products, and services markets are converging," said Randall Booth, vice
president of Perot Systems and general manager of its Healthcare Services Group.
"Through this acquisition, we saw a unique opportunity for our healthcare payor
group to combine its custom Internet solutions and services with the enterprise
applications of a market leader. The streamlined transaction flow, increased
automation, and customer service capabilities found in this integrated offering
will help payors expand market share, while continuing to drive significant
back-office efficiencies."
"This combination gives HSDC access to capital, exceptional development
resources, and deep healthcare payor expertise. It will allow HSDC to offer a
broad array of services and accelerate delivery of Internet connectivity, HIPAA
remediation, and broader product functionality," said Arthur M. Southam, MD,
president and CEO of HSDC. "HSDC's customers and prospects will benefit from
Perot Systems' track record of delivering outstanding results to clients. Perot
Systems augments our product expertise and provides our combined
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organization with excellent market opportunities and outstanding delivery
capabilities."
"One of my objectives for Perot Systems is to use our financial resources in a
focused manner to strengthen our position in the marketplace," said Ross Perot,
Jr., president and CEO of Perot Systems. "This investment not only demonstrates
our commitment to providing robust solutions to clients, but illustrates our
commitment to invest in strategic areas that will create growth opportunities
and value for our shareholders."
Synergies between Perot Systems and HSDC will be realized by leveraging Perot
Systems' capabilities to accelerate product development in areas such as HIPAA,
ASP, Internet-enabled solutions, and integrated solution sets. These added
capabilities will also permit the delivery of all product sets and services
within a substantially improved cost structure. Perot Systems expects that the
acquisition will be EPS (Earnings Per Share) neutral in 2001 and EPS accretive
beginning in 2002.
The holders of approximately 57% of the outstanding voting securities of HSDC
have agreed to vote in favor of the acquisition. The consummation of the
transaction is subject to customary conditions.
ABOUT PEROT SYSTEMS
Perot Systems Corporation is a worldwide provider of information technology
services and business solutions. Through its integrated service offering, Perot
Systems delivers end-to-end solutions that address all aspects of strategy,
systems and infrastructure, enabling clients to accelerate growth, streamline
operations, and create new levels of customer value. Headquartered in Dallas,
Texas, Perot Systems reported 1999 revenue of $1.1 billion. The company has more
than 7,500 Associates located in the United States, Europe, and Asia. Additional
information on Perot Systems is available at http://www.perotsystems.com.
ABOUT HEALTH SYSTEMS DESIGN
Health Systems Design, with headquarters in Oakland, California is a leading
provider of information systems solutions for organizations that administer
health benefits. The DIAMOND software manages large and complex databases and
the high volume complex transactions associated with the administration of
health benefits and provider payments. The company's software and services allow
clients to control costs and improve the service they provide to their members.
HSDC's 119 licenses include health insurers, Health Maintenance Organizations
(HMOs), Preferred Provider Organizations (PPOs), Third-Party Administrators
(TPAs), and provider organizations, including some of the nation's largest
health plans.
HSDC was founded in 1988 and has traded on the NASDAQ National Market since its
initial public offering in 1996. Additional information on Health Systems Design
is available at http://www.hsdc.com.
STATEMENTS CONTAINED WITHIN THIS PRESS RELEASE MAY CONTAIN FORWARD-LOOKING
STATEMENTS, WHICH INVOLVE RISKS AND UNCERTAINTIES THAT MAY CAUSE ACTUAL RESULTS
TO VARY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. IN SOME CASES,
YOU CAN IDENTIFY SUCH FORWARD-LOOKING STATEMENTS BY TERMINOLOGY SUCH AS "MAY,"
"WILL," "COULD," "FORECASTS," "EXPECTS," "PLANS," "ANTICIPATES," "BELIEVES,"
"ESTIMATES," "PREDICTS," "POTENTIAL," OR "CONTINUE." IN EVALUATING ALL
FORWARD-LOOKING STATEMENTS, YOU SHOULD SPECIFICALLY CONSIDER VARIOUS FACTORS
THAT MAY CAUSE ACTUAL RESULTS TO VARY FROM THOSE CONTAINED IN THE
FORWARD-LOOKING STATEMENTS, SUCH AS: THE LOSS OF MAJOR CLIENTS; PEROT SYSTEMS'
AND HEALTH SYSTEM DESIGN'S ABILITY TO ACHIEVE FUTURE SALES; CHANGES IN ITS
RELATIONSHIP AND VARIABILITY OF REVENUE AND EXPENSE ASSOCIATED WITH PEROT
SYSTEMS' LARGEST CUSTOMER; THE LOSS OF KEY PERSONNEL; RISKS ASSOCIATED WITH
ESTABLISHING AND GROWING START-UP BUSINESSES; THE HIGHLY
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COMPETITIVE MARKET IN WHICH PEROT SYSTEMS AND HEALTH SYSTEMS DESIGN OPERATE; THE
VARIABILITY OF QUARTERLY OPERATING RESULTS; CHANGES IN TECHNOLOGY; RISKS RELATED
TO INTERNATIONAL OPERATIONS. PLEASE REFER TO THE PEROT SYSTEMS ANNUAL REPORT ON
FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999, AND THE HEALTH SYSTEM
DESIGN ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1999,
AS FILED WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION AND AVAILABLE AT
WWW.SEC.GOV, FOR ADDITIONAL INFORMATION REGARDING RISK FACTORS. PEROT SYSTEMS
AND HEALTH SYSTEMS DESIGN DISCLAIM ANY INTENTION OR OBLIGATION TO REVISE ANY
FORWARD-LOOKING STATEMENTS WHETHER AS A RESULT OF NEW INFORMATION, FUTURE
DEVELOPMENTS, OR OTHERWISE.
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INVESTOR CONTACT:
Perot Systems Corporation
John Lyon
phone: (972) 340-6132
fax: (972) 340-6100
[email protected]
PRESS CONTACT:
Perot Systems Corporation
Kim Testa
phone: (972) 340-6727
[email protected]
HSDC CONTACT:
Health Systems Design Corporation
Chris Ohman
phone: (510) 251-1330
fax: (510) 251-1326
[email protected]
