<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 5, 1998
Registration No. 333-__________
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
CONCENTRA MANAGED CARE, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 04-3363415
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
312 UNION WHARF
BOSTON, MASSACHUSETTS 02109
(Address of principal executive offices, including zip code)
-----------------
CONCENTRA MANAGED CARE, INC. STOCK OPTIONS
(Full title of the plan)
DONALD J. LARSON
PRESIDENT AND CHIEF EXECUTIVE OFFICER
CONCENTRA MANAGED CARE, INC.
312 UNION WHARF
BOSTON, MASSACHUSETTS 02109
(617) 367-2163
(Name, address and telephone number of agent for service)
copy to:
RICHARD A. PARR II
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
CONCENTRA MANAGED CARE, INC.
5080 SPECTRUM DRIVE, SUITE 400
WEST TOWER
DALLAS, TEXAS 75248
(972) 364-8000
<TABLE>
CALCULATION OF REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Proposed
Title of securities Amount to be Proposed maximum maximum aggregate Amount of
to be registered registered offering price per unit* offering price* registration fee
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par
value per share . . . . 580,530 shares $33.0625 $19,193,774 $5,663
- ---------------------------------------------------------------------------------------------------------
</TABLE>
* Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(h) under the Securities Act of 1933 and based on
the average of the high and low sales prices of the Common Stock reported
on the Nasdaq National Market of The Nasdaq Stock Market on February 26,
1998.
===============================================================================
<PAGE>
EXPLANATORY NOTE
On February 24, 1998, Concentra Subsidiary, Inc. ("Merger Sub"), a
Delaware corporation and direct wholly-owned subsidiary of Concentra Managed
Care, Inc. (the "Registrant"), merged with and into Preferred Payment
Systems, Inc., a Delaware corporation ("PPS"), pursuant to an Agreement and
Plan of Merger (the "Merger Agreement") dated February 24, 1998, by and among
the Registrant, Merger Sub and PPS (the "PPS Transaction"). Pursuant to the
terms of the Merger Agreement, (a) the Registrant assumed each outstanding
option to purchase common stock, par value $.01 per share, of PPS ("PPS
Common Stock") granted under the PPS 1996 Incentive Stock Plan and the PPS
1996 Replacement Stock Option Plan (the "Plans"), and (b) the assumed options
became exercisable for common stock, par value $.01 per share, of the
Registrant ("Concentra Common Stock") at the rate of 2.6473525 shares of
Concentra Common Stock for each share of PPS Common Stock. The Registrant is
filling this Registration Statement on Form S-8 to reflect the assumption by
the Registrant of each such option to purchase PPS Common Stock and the
conversion of the options for PPS Common Stock into options for Concentra
Common Stock in the PPS Transaction.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been filed with the Securities and Exchange
Commission by the Registrant and are incorporated herein by reference and made a
part hereof:
1. The Company's Registration Statement on Form S-4 (File No. 333-27105)
dated August 1, 1997;
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1997;
3. The Company's Current Reports on Form 8-K filed on September 11, 1997,
October 1, 1997, October 14, 1997, November 7, 1997, January 23, 1998,
February 2, 1998, February 18, 1998 and March 2, 1998; and
4. The description of the Company's capital stock contained in Item 1 of
the Registration Statement on Form 8-A (File No. 000-22751) filed with
the Commission on June 25, 1997, including any amendment or report
filed for the purpose of updating such description filed with the
Commission pursuant to Section 13 of the Exchange Act.
All other documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Prospectus and
to be a part hereof from the date of filing such documents. The Company will
provide without charge to each person to whom a copy of this Prospectus is
delivered, upon the written or oral request of any such person, a copy of any or
all of the documents that are incorporated by reference, other than exhibits to
such documents not specifically incorporated by reference. Requests for such
copies should be directed to Concentra Managed Care, Inc., 5080 Spectrum Drive,
Suite 400, West Tower, Dallas, Texas 75248, Attention: Richard A. Parr II,
Executive Vice President and General Counsel, telephone (972) 364-8000.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
-2-
<PAGE>
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Twelfth of the Amended and Restated Certificate of Incorporation of
the Registrant provides that the Registrant shall indemnify its officers and
directors to the maximum extent allowed by Delaware General Corporation Law.
Pursuant to Section 145 of the Delaware General Corporation Law, the Registrant
generally has the power to indemnify its present and former directors and
officers against expenses and liabilities incurred by them in connection with
any suit to which they are, or are threatened to be made, a party by reason of
their serving in those positions so long as they acted in good faith and in a
manner they reasonably believed to be in, or not opposed to, the best interests
of the Registrant, and with respect to any criminal action, so long as they had
no reasonable cause to believe their conduct was unlawful.
With respect to suits by or in the right of the Registrant, however,
indemnification is generally limited to attorney's fees and other expenses and
is not available if the person is adjudged to be liable to the Registrant,
unless the court determines that indemnification is appropriate. The statute
expressly provides that the power to indemnify authorized thereby is not
exclusive of any rights granted under any bylaw, agreement, vote of stockholders
or disinterested directors, or otherwise. The Registrant also has the power to
purchase and maintain insurance for its directors and officers. Additionally,
Article Twelfth of the Amended and Restated Certificate of Incorporation
provides that, in the event that an officer or director files suit against the
Registrant seeking indemnification of liabilities or expenses incurred, the
burden will be on the Registrant to prove that the indemnification would not be
permitted under the Delaware General Corporation Law.
The preceding discussion of the Company's Amended and Restated Certificate
of Incorporation and Section 145 of the Delaware General Corporation Law is not
intended to be exhaustive and is qualified in its entirety by the Company's
Amended and Restated Certificate of Incorporation and Section 145 of the
Delaware General Corporation Law.
the Registrant has entered into indemnity agreements with its directors and
officers. Pursuant to such agreements, the Registrant will, to the extent
permitted by applicable law, indemnify such persons against all expenses,
judgments, fines and penalties incurred in connection with the defense or
settlement of any actions brought against them by reason of the fact that they
were directors or officers of the Registrant or assumed certain responsibilities
at the direction of the Registrant.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Unless otherwise indicated below as being incorporated by reference to
another filing of the Registrant with the Commission, each of the following
exhibits is filed herewith:
4.1 -- Preferred Payment Systems, Inc. 1996 Incentive Stock Plan
4.2 -- Preferred Payment Systems, Inc. 1996 Replacement Stock
Option Plan
5.1 -- Opinion of Richard A. Parr II
23.1 -- Consent of Arthur Andersen LLP
23.2 -- Consent of Richard A. Parr II (included in his opinion filed as
Exhibit 5.1 hereto)
-3-
<PAGE>
24.1 -- Powers of Attorney (included in the signature
pages hereto)
ITEM 9. UNDERTAKINGS.
The 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, as amended (the "Securities Act");
(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; and
(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 (1)(i) and
(1)(ii) do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to section 13 or section
15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purposes of determining any liability under
the Securities Act, 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.
(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.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Exchange Act 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.
(5) Insofar as indemnification for liabilities arising under the
Securities Act 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
Commission such indemnification is against public policy as expressed in
the Securities 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 Securities Act and will be governed by
the final adjudication of such issue.
-4-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Dallas, State of Texas,
on the 5th day of March, 1998.
CONCENTRA MANAGED CARE, INC.
By: /s/ Richard A. Parr II
---------------------------------
Richard A. Parr II
Executive Vice President, General
Counsel and Secretary
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. Each person whose signature appears
below authorizes and appoints each of Richard A. Parr II and James M.
Greenwood, and each of them severally, acting alone and without the other, as
his attorney-in-fact to execute in the name of such person and to file any
amendments to this Registration Statement necessary or advisable to enable
the Company to comply with the Securities Act of 1933 and any rules,
regulations and requirements of the Securities and Exchange Commission in
respect thereof, in connection with the registration of the securities which
are the subject of this Registration Statement, which amendments may make
such changes in the Registration Statement as such attorney-in-fact may deem
appropriate.
<TABLE>
SIGNATURE CAPACITY DATE
--------- -------- ----
<S> <C> <C>
/s/ Donald J. Larson Chairman of the Board and March 5, 1998
- ---------------------------- Chief Executive Officer
Donald J. Larson (Principal Executive Officer)
/s/ Joseph F. Pesce Executive Vice President, Chief March 5, 1998
- ---------------------------- Financial Officer and Treasurer
Joseph F. Pesce (Principal Financial and
Accounting Officer)
/s/ Daniel J. Thomas President, Chief Operating March 5, 1998
- ---------------------------- Officer and Director
Daniel J. Thomas
/s/ John K. Carlyle Director March 5, 1998
- ----------------------------
John K. Carlyle
/s/ George H. Conrades Director March 5, 1998
- ----------------------------
George H. Conrades
/s/ Robert W. O'Leary Director March 5, 1998
- ----------------------------
Robert W. O'Leary
/s/ Robert A. Ortenzio Director March 5, 1998
- ----------------------------
Robert A. Ortenzio
/s/ Paul B. Queally Director March 5, 1998
- ----------------------------
Paul B. Queally
<PAGE>
<CAPTION>
SIGNATURE CAPACITY DATE
--------- -------- ----
<S> <C> <C>
/s/ Mitchell T. Rabkin, M.D. Director March 5, 1998
- ----------------------------
Mitchell T. Rabkin, M.D.
/s/ Lois E. Silverman Director March 5, 1998
- ----------------------------
Lois E. Silverman
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit Description of Exhibit
- ------- ----------------------
4.1 -- Preferred Payment Systems, Inc. Amended and Restated 1996 Incentive
Stock Plan
4.2 -- Preferred Payment Systems, Inc. 1996 Replacement Stock Option Plan
5.1 -- Opinion of Richard A. Parr II
23.1 -- Consent of Arthur Andersen LLP
23.2 -- Consent of Richard A. Parr II (included in his opinion filed as
Exhibit 5.1 hereto)
24.1 -- Powers of Attorney (included in the signature pages hereto)
<PAGE>
AMENDED AND RESTATED
1996 INCENTIVE STOCK PLAN
1. PURPOSE. The Amended and Restated 1996 Incentive Stock Plan (the
"Plan") amends and restates the 1996 Incentive Stock Plan adopted on August
30, 1996. The Plan is intended to provide incentives which will attract and
retain highly competent persons as officers, key employees, directors and
independent consultants of Preferred Payment Systems, Inc., a Delaware
corporation (the "Company"), and its subsidiaries, including Preferred
Payment Systems, L.L.C., by providing them opportunities to acquire shares of
Common Stock of the Company ("Common Stock") or to receive monetary payments
based on the value of such shares pursuant to the Benefits described herein.
2. ADMINISTRATION. The Plan will be administered by the Compensation
Committee of the Board of Directors of the Company (the "Committee"),
appointed by the Board from among its members. The Committee is authorized,
subject to the provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper administration of the Plan
and to make such determinations and interpretations and to take such action
in connection with the Plan and any Benefits granted hereunder as it deems
necessary or advisable. All determinations and interpretations made by the
Committee shall be binding and conclusive on all participants and their legal
representatives. No member of the Board, no member of the Committee and no
employee of the Company shall be liable for any act or failure to act
hereunder, by any other member or employee or by any agent to whom duties in
connection with the administration of this Plan have been delegated or,
except in circumstances involving his or her bad faith, gross negligence or
fraud, for any act or failure to act by the member or employee.
3. PARTICIPANTS. Participants will consist of such key employees
(including officers and directors) and independent consultants of the Company
or its subsidiaries as the Committee in its sole discretion determines to be
significantly responsible for the success and future growth and
profitability of the Company and whom the Committee may designate from time
to time to receive Benefits under the Plan. Designation of a participant in
any year shall not require the Committee to designate such person to receive
a Benefit in any other year or, once designated, to receive the same type or
amount of Benefit as granted to the participant in any year. The Committee
shall consider such factors as it deems pertinent in selecting participants
and in determining the type and amount of their respective Benefits.
<PAGE>
4. TYPE OF BENEFITS. Benefits under the Plan may be granted in any
one or a combination of (a) Incentive Stock Options and (b) Non-qualified
Stock Options.
5. SHARES RESERVED UNDER THE PLAN. There is hereby reserved for
issuance under the Plan an aggregate of 325,000 shares of Common Stock, which
may be authorized but unissued or treasury shares. Any shares subject to
stock options or issued under such options may thereafter be subject to new
options under this Plan if there is a lapse, expiration or termination of
any such options prior to issuance of the shares or if shares are issued
under such options, and thereafter are reacquired by the Company without
consideration pursuant to rights reserved by the Company upon issuance thereof.
6. STOCK OPTIONS. Incentive Stock Options and Non-qualified Stock
Options will consist of stock options to purchase Common Stock at purchase
prices not less than 100% of the fair market value of the Common Stock on the
date the option is granted. Incentive Stock Options granted to a participant
that holds more than 10% of the issued and outstanding shares of Common Stock
("Ten Percent Holders") will consist of stock options to purchase Common
Stock at purchase price not less than 110% of the fair market value of the
Common Stock on the date the option is granted. Said purchase price may be
paid by check or, in the discretion of the Committee, by the delivery (or
certification of ownership) of shares of Common Stock of the Company. In the
discretion of the Committee, payment may also be made by delivering a
properly executed exercise notice to the Company, together with a copy of the
irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds to pay the exercise price. All stock options
granted hereunder shall become vested and exercised in installments at such
times as shall be determined by the Committee at the date of grant.
Non-qualified Stock Options shall be exercisable not later than fifteen years
after the date they are granted; Incentive Stock Options shall be exercisable
not later than ten years after the date they are granted; and Incentive Stock
Options granted to Ten Percent Holders shall be exercisable not later than
five years after the date they are granted. In the event of termination of
employment, all stock options shall terminate at such times and upon such
conditions or circumstances as the Committee shall in its discretion set
forth in such option at the date of grant or subsequently. The aggregate fair
market value (determined as of the time the option is granted) of the Common
Stock with respect to which Incentive Stock Options are exercisable for the
first time by a participant during any calendar year (under all option plans
of the Company and its subsidiary corporations) shall not exceed $100,000.
Options designated as "incentive stock options" that fail to continue to
meet the requirements of Section 422 of the Internal Revenue Code shall be
redesignated as nonqualified options for
<PAGE>
Federal income tax purposes automatically without further action by the
Committee on the date of such failure to continue to meet the requirements of
Section 422 of the Code.
The Committee may provide, either at the time of grant or subsequently,
that a stock option include the right to acquire a replacement stock option
upon exercise of the original stock option (in whole or in part) prior to
termination of employment of the participant and through payment of the
exercise price in shares of Common Stock. The terms and conditions of a
replacement option shall be determined by the Committee in its sole discretion.
7. ADJUSTMENT PROVISIONS.
(a) If the Company shall at any time change the number of issued
shares of Common Stock without new consideration to the Company (such as by
stock dividends or stock splits), the total number of shares reserved for
issuance under this Plan and the number of shares covered by each outstanding
Benefit shall be adjusted so that the aggregate consideration payable to the
Company and the value of each such Benefit shall not be changed. The
Committee may also provide for the continuation of Benefits or for other
equitable adjustments after changes in the Common Stock resulting from
reorganization, sale, merger, consolidation or similar occurrence.
(b) Notwithstanding any other provision of this Plan, and without
affecting the number of shares otherwise reserved or available hereunder, the
Committee may authorize the issuance or assumption of Benefits in connection
with any merger, consolidation, acquisition of property or stock, or
reorganization upon such terms and conditions as it may deem appropriate.
(c) In the case of any merger, consolidation or combination of the
Company with or into another corporation, other than a merger, consolidation
or combination in which the Company is the continuing corporation and which
does not result in the outstanding Common Stock being converted into or
exchanged for different securities, cash or other property, or any
combination thereof (an "Acquisition"):
(i) any participant to whom a stock option has been granted
under the Plan shall have the right (subject to the provisions of the Plan
and any limitations applicable to such option) thereafter and during the term
of such option, to receive upon exercise thereof the Acquisition
Consideration (as defined below) receivable upon such Acquisition by a holder
of the number of shares of Common Stock which might have been obtained upon
exercise of such option or portion thereof, as the case may be, immediately
prior to such Acquisition;
<PAGE>
The term "Acquisition Consideration" shall mean the kind and amount of
shares of the surviving or new corporation, cash, securities, evidence of
indebtedness, other property or any combination thereof receivable in respect
of one share of Common Stock of the Company upon consummation of an
Acquisition.
8. NONTRANSFERABILITY. Each Benefit granted under the Plan shall not
be transferable otherwise than by will or the laws of descent and
distribution, and shall be exercisable, during the participant's lifetime,
only by the participant. In the event of the death of a participant, each
Benefit theretofore granted to him shall be exercisable within the period
after his death established by the Committee at the time of grant (but not
beyond the stated duration of the Benefit) and then only:
(a) By the executor or administrator of the estate of the deceased
participant or the person or persons to whom the deceased participant's rights
under the Benefit shall pass by will or the laws of descent and distribution;
and
(b) To the extent that the deceased participant was entitled to do
so at the date of his death.
Notwithstanding the foregoing, at the discretion of the Committee, an award
of a Benefit may permit the transferability of the Benefit by the participant
solely to members of the participant's immediate family or trusts or family
partnerships for the benefit of such persons subject to such terms and
conditions as may be established by the Committee.
9. OTHER PROVISIONS. The award of any Benefit under the Plan may also
be subject to such other provisions (whether or not applicable to the Benefit
awarded to any other participant) as the Committee determines appropriate,
including without limitation, provisions for the installment purchase of
Common Stock under Stock Options, provisions to assist the participant in
financing the acquisition of Common Stock, restrictions on resale or other
disposition, provisions for the acceleration of exercisability of Benefits in
the event of a change of control of the Company, provisions for the payment
of the value of the Benefits to participants in the event of a change of
control of the Company, provisions to comply with Federal and state
securities laws, or understandings or conditions as to the participant's
employment in addition to those specifically provided for under the Plan.
10. RULES. The Committee may establish such rules and regulations as
it considers desirable for the administration of the Plan.
11. MANNER OF ACTION BY COMMITTEE. Except as required under that
certain Convertible Note Purchase Agreement dated August 30, 1996, as is may
be amended from time to time, among
<PAGE>
the Company, the Investors listed on Exhibit A thereto and the Shareholders
listed on Exhibit B thereto, a majority of the members of the Committee
qualified to act on a question may act by meeting or by writing signed
without meeting and may execute, or delegate to one of its members authority
to execute any instrument or document required. The Committee may delegate
the performance of ministerial functions in connection with the Plan to such
person or persons as the Committee may select. The costs of administration of
the Plan will be paid by the Company.
12. FAIR MARKET VALUE. For purposes hereof, fair market value of
Common Stock shall be determined by the Committee as follows:
(a) If the Common Share was traded on a stock exchange on the date
in question, then the Fair Market Value shall be equal to the closing
price reported by the applicable composite-transactions report for such
date;
(b) If the Common Share was traded over-the-counter on the date in
question but was classified as a national market issue, then the Fair
Market Value shall be equal to the last-transaction price quoted by the
Nasdaq National Market system for such date;
(c) If the Common Share was traded over-the-counter on the date in
question but was not classified as a national market issue, then the Fair
Market Value shall be equal to the mean between the last reported
representative bid and asked prices quoted by the Nasdaq National Market
system for such date; and
(d) If none of the foregoing provisions is applicable, then the
Fair Market Value shall be determined by the Committee in good faith on
such basis as it deems appropriate.
13. TAXES. The Company shall be entitled if necessary or desirable to
pay or withhold the amount of any tax attributable to any amounts payable
under the Plan after giving the person entitled to receive such amount notice
as far in advance as practicable, and the Company may defer making payment as
to any Benefit if any such tax may be pending until indemnified to its
satisfaction. When a person is required to pay to the Company an amount
required to be withheld under applicable tax laws in connection with
exercises of Non-qualified Stock Options or other Benefits under the Plan,
the Committee may, in its discretion and subject to such rules as it may
adopt, permit such person to satisfy the obligation, in whole or in part, by
electing to have the Company withhold shares of Common Stock having a fair
market value equal to the amount required to be withheld.
<PAGE>
14. TENURE. A participant's right, if any, to continue to serve the
Company and its subsidiaries as an officer, employee, or otherwise, shall not
be enlarged or otherwise affected by his designation as a participant under
the Plan.
15. AMENDMENT AND TERMINATION. The terms and conditions applicable to
any Benefit granted under the Plan may be amended or modified by mutual
agreement between the Company and the participant or such other persons as
may then have an interest therein. Also, by mutual agreement between the
Company and a participant hereunder, or under any other present or future
plan of the Company, stock options or other Benefits may be granted to such
participant in substitution and exchange for, and in cancellation of, any
Benefits previously granted such participant under this Plan, or any Benefit
previously or hereafter granted to him under any other present or future plan
of the Company. The Board of Directors may amend the Plan from time to time
or terminate the Plan at any time. However, no action authorized by this
paragraph shall reduce the amount of any existing Benefit or change the terms
and conditions thereof without the participant's consent. The Board of
Directors may amend the Plan in any respect without stockholder approval if
stockholder approval is not then required to comply with applicable federal,
state or other regulatory requirements.
16. STOCKHOLDER APPROVAL. The Plan was adopted by the Board of
Directors and the Stockholders of the Company on July 31, 1997. This Plan
shall continue in effect until terminated by the Board pursuant to Section
18; provided, however, that no Incentive Stock Option shall be granted more
than ten years after the date of the adoption of this Plan by the Board.
<PAGE>
1996 REPLACEMENT STOCK OPTION PLAN
1. PURPOSE. The 1996 Replacement Stock Option PLan (the "Plan") is
intended to provide incentives which will attract and retain highly competent
persons as officers, key employees, directors and independent consultants of
Preferred Payment Systems, Inc., a Delaware corporation (the "Company") and
its subsidiaries, by providing them opportunities to acquire shares of Common
Stock of the Company ("Common Stock").
2. ADMINISTRATION. The Plan will be administered by the Compensation
Committee of the Board of Directors of the Company (the "Committee"),
appointed by the Board from among its members.
3. PARTICIPANTS. Participants will consist of such key employees
(including officers and directors) and independent consultants of the Company
or its subsidiaries as the Committee in its sole discretion determines to be
significantly responsible for the success and future growth and profitability
of the Company and whom the Committee may designate from time to time to
receive Benefits under the Plan. Designation of a participant in any year
shall not require the Committee to designate such person to receive a Benefit
in any other year or, once designated, to receive the same type or amount of
Benefit as granted to the participant in any year. The Committee shall
consider such factors as it deems pertinent in selecting participants and in
determining the type and amount of their respective Benefits.
4. TYPES OF BENEFITS. Benefits under the Plan may be granted in any one
or a combination of (a) Incentive Stock Options; and (b) Non-qualified Stock
Options; all as described below.
5. SHARES RESERVED UNDER THE PLAN. There is hereby reserved for
issuance under the Plan an aggregate of 27,833 shares of Common Stock, which
may be authorized but unissued or treasury shares.
6. STOCK OPTIONS. Incentive Stock Options and Non-qualified Stock
Options will consist of stock options to purchase Common Stock at purchase
prices not less than 100% of the fair market value of the Common Stock on the
date the option is granted. Incentive Stock Options granted to a participant
that holds more than 10% of the issued and outstanding shares of Common Stock
("Ten Percent Holders") will consist of stock options to purchase Common
Stock at not less than 110% of the fair market value of the Common Stock on
the date the option is granted. Said purchase price may be paid by check or,
in the discretion of the Committee, by the delivery (or certification of
ownership) of shares of Common Stock of the Company. In the discretion of the
Committee, payment may also be made a delivering a properly executed exercise
notice to the
<PAGE>
Company, together with a copy of the irrevocable instructions to a broker to
deliver promptly to the Company the amount of sale or loan proceeds to pay
the exercise price. Non-qualified Stock Options shall be exercisable not
later than fifteen years after the date they are granted; Incentive Stock
Options shall be exercisable not later than ten years after the date they are
granted; and Incentive Stock Options granted to Ten Percent Holders shall be
exercisable not later than five years after the date they are granted. In the
event of termination of employment, all stock options shall terminate at such
times and upon such conditions or circumstances as the Committee shall in its
discretion set forth in such option at the date of grant or subsequently. The
aggregate fair market value (determined as of the time the option is granted)
of the Common Stock with respect to which Incentive Stock Options are
exercisable for the first time by a participant during any calendar year
(under all option plans of the Company and its subsidiary corporations) shall
not exceed $100,000.
7. ADJUSTMENT PROVISIONS.
(a) If the Company shall at any time change the number of issued
shares of Common Stock without new consideration to the Company (such as by
stock dividends or stock splits), the total number of shares reserved for
issuance under this Plan and the number of shares covered by each outstanding
Benefit shall be adjusted so that the aggregate consideration payable to the
Company and the value of each such Benefit shall not be changed. The
Committee may also provide for the continuation of Benefits or for other
equitable adjustments after changes in the Common Stock resulting from
reorganization, sale, merger, consolidation or similar occurrence.
(b) Notwithstanding any other provision of this Plan, and without
affecting the number of shares otherwise reserved or available hereunder, the
Committee may authorize the issuance or assumption of Benefits in connection
with any merger, consolidation, acquisition of property or stock, or
reorganization upon such terms and conditions as it may deem appropriate.
(c) In the case of any merger, consolidation or combination of the
Company with or into another corporation, other than a merger, consolidation
or combination in which the Company is the continuing corporation and which
does not result in the outstanding Common Stock being converted into or
exchanged for different securities, cash or other property, or any combination
thereof (an "Acquisition"), any participant to whom a stock option has been
granted under the Plan shall have the right (subject to the provisions of the
Plan and any limitation applicable to such option) thereafter and during the
term of such option, to receive upon exercise thereof the Acquisition
Consideration (as defined below) receivable upon such Acquisition
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by a holder of the number of shares of Common Stock which might have been
obtained upon exercise of such option or portion thereof, as the case may be,
immediately prior to such Acquisition.
The term "Acquisition Consideration" shall mean the kind and amount of
shares of the surviving or new corporation, cash, securities, evidence of
indebtedness, other property or any combination thereof receivable in respect
of one share of Common Stock of the Company upon consummation of an
Acquisition.
8. NONTRANSFERABILITY. Each Benefit granted under the Plan to an
employee shall not be transferable by him otherwise than by will or the laws
of descent and distribution, and shall be exercisable, during his lifetime,
only by him. In the event of the death of a participant, each Benefit
theretofore granted to him shall be exercisable within the period after his
death established by the Committee at the time of grant (but not beyond the
stated duration of the Benefit) and then only:
(a) By the executor or administrator of the estate of the deceased
participant or the person or persons to whom the deceased participant's
rights under the Benefit shall pass by will or the laws of descent and
distribution; and
(b) To the extent that the deceased participant was entitled to do
so at the date of his death.
Notwithstanding the foregoing, at the discretion of the Committee, an award
of a Benefit may permit the transferability of the Benefit by the participant
solely to members of the participant's immediate family or trusts or family
partnerships for the benefit of such persons subject to such terms and
conditions as may be established by the Committee.
9. OTHER PROVISIONS. The award of any Benefit under the Plan may also
be subject to such other provisions (whether or not applicable to the Benefit
awarded to any other participant) as the Committee determines appropriate,
including without limitation, provisions for the installment purchase of
Common Stock under Stock Options, provisions to assist the participant in
financing the acquisition of Common Stock, restrictions on resale or other
disposition, provisions for the acceleration of the exercisability of
Benefits in the event of a change of control of the Company, provisions for
the payment of the value of the Benefits to participants in the event of a
change of control of the Company, provisions to comply with Federal and state
securities laws, or understandings or conditions as to the participant's
employment in addition to those specifically provided for under the Plan.
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10. RULES. The Committee may establish such rules and regulations as
it considers desirable for the administration of the Plan.
11. MANNER OF ACTION BY COMMITTEE. Except as required under that
certain Convertible Note Purchase Agreement dated August 30, 1996, as may be
amended from time to time, among the Company, the Investors listed on Exhibit
A thereto and the Shareholders listed on Exhibit B thereto, a majority of the
members of the Committee qualified to act on a question may act by meeting or
by writing signed without meeting and may execute, or delegate to one of its
members authority to execute any instrument or document required. The
Committee may delegate the performance of ministerial functions in connection
with the Plan to such person or persons as the Committee may select. The
costs of administration of the Plan will be paid by the Company.
12. FAIR MARKET VALUE. For purposes hereof, fair market value of
Common Stock shall be determined by the Committee as follows:
(a) If the Common Stock was traded on a stock exchange on the date
in question, then the Fair Market Value shall be equal to the closing
price reported by the applicable composite-transactions report for such
date;
(b) If the Common Stock was traded over-the-counter on the date in
question but was classified as a national market issue, then the Fair
Market Value shall be equal to the last-transaction price quoted by the
Nasdaq National Market system for such date;
(c) If the Common Stock was traded over-the-counter on the date in
question but was not classified as a national market issue, then the
Fair Market Value shall be equal to the mean between the last reported
representative bid and asked prices quoted by the Nasdaq National Market
system for such date; and
(d) If none of the foregoing provisions is applicable, then the
Fair Market Value shall be determined by the Committee in good faith on
such basis as it deems appropriate.
13. TAXES. The Company shall be entitled if necessary or desirable to
pay or withhold the amount of any tax attributable to any amounts payable
under the Plan after giving the person entitled to receive such amount notice
as far in advance as practicable, and the Company may defer making payment as
to any Benefit if any such tax may be pending until indemnified to its
satisfaction. When a person is required to pay to the Company an amount
required to be withheld under applicable tax laws in connection with
exercises of Non-qualified Stock Options or other
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<PAGE>
Benefits under the Plan, the Committee may, in its discretion and subject to
such rules as it may adopt, permit such person to satisfy the obligation, in
whole or in part, by electing to have the Company withhold shares of Common
Stock having a fair market value equal to the amount required to be withheld.
14. TENURE. A participant's right, if any, to continue to serve the
Company and its subsidiaries as an officer, employee, or otherwise, shall not
be enlarged or otherwise affected by his designation as a participant under
the Plan.
15. AMENDMENT AND TERMINATION. The terms and conditions applicable to
any Benefit granted under the Plan may be amended or modified by mutual
agreement between the Company and the participant or such other persons as
may then have an interest therein. Also, by mutual agreement between the
Company and a participant hereunder, or under any other present or future
plan of the Company, stock options or other Benefits may be granted to such
participant in substitution and exchange for, and in cancellation of, any
Benefits previously granted such participant under this Plan, or any Benefit
previously or hereafter granted to him under any other present or future plan
of the Company. The Board of Directors may amend the Plan from time to time
or terminate the Plan at any time. However, no action authorized by this
paragraph shall reduce the amount of any existing Benefit or change the terms
and conditions thereof without the participant's consent. The Board of
Directors may amend the Plan in any respect without stockholder approval if
stockholder approval is not then required to comply with applicable federal,
state or other regulatory requirements.
16. STOCKHOLDER APPROVAL. The Plan was adopted by the Board of
Directors and the Stockholders of the Company on August 30, 1996. This Plan
shall continue in effect until terminated by the Board pursuant to Section
16 of the Securities Exchange Act of 1934, as amended; provided, however,
that no Incentive Stock Option shall be granted more than ten years after the
date of the adoption of this Plan by the Board.
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EXHIBIT 5.1
[CONCENTRA MANAGED CARE, INC. LETTERHEAD]
March 5, 1998
Concentra Managed Care, Inc.
312 Union Wharf
Boston, Massachusetts 02109
Ladies and Gentlemen:
I have acted as counsel for Concentra Managed Care, Inc., a Delaware
corporation (the "Company"), in connection with the Company's registration under
the Securities Act of 1933 (the "Act"), of 580,530 shares of common stock, par
value $.01 per share (the "Shares"), of the Company pursuant to the Company's
Registration Statement on Form S-8 (the "Registration Statement") filed with the
Securities and Exchange Commission (the "Commission") on March 5, 1998. The
Registration Statement is being filed with the Commission in connection with the
assumption by the Company of certain options to purchase common stock of
Preferred Payment Systems, Inc., a Delaware corporation ("PPS"), granted under
the PPS 1996 Incentive Stock Plan and the PPS 1996 Replacement Stock Option Plan
(the "Plans").
In reaching the opinions set forth herein, I have examined and am familiar
with the originals or copies, certified or otherwise, of such documents and
records of the Company and PPS, and such statutes, regulations, and other
instructions as I have deemed necessary or advisable for purposes of this
opinion, including (i) the Registration Statement, (ii) the Amended and Restated
Certificate of Incorporation of the Company, (iii) the By-Laws of the Company
and (iv) certain minutes of meetings of, and resolutions adopted by, the Board
of Directors of the Company.
I have assumed that (i) all information contained in all documents reviewed
by me is true, correct, and complete, (ii) all signatures on all documents
reviewed by me are genuine, (iii) all documents submitted to me as originals are
true and complete, (iv) all documents submitted to me as copies are true and
complete copies of the originals thereof, and (v) all persons executing and
delivering originals or copies of documents examined by me were competent to
execute and deliver such documents. In addition, I have assumed that upon
exercise of the stock options (the "Options") granted under the Plans and
assumed by the Company pursuant to which shares of common stock, par value $.01
per share, of the Company (the "Shares") will be issued, (i) the full
consideration for each Share shall be paid to the Company and in no event will
such consideration be less than the par value for each Share, and (ii)
certificates evidencing the Shares will be properly executed and delivered by
the Company in accordance with the Delaware General Corporation Law (the
"DGCL").
Based on the foregoing and having due regard for the legal considerations I
deem relevant, I am of the opinion that the Shares, when issued by the Company
upon exercise of the Options, will be validly issued, fully paid and
non-assessable.
This opinion is limited in all respects to the laws of the State of Texas,
the DGCL, and the federal laws of the United States of America. You should be
aware that I am not admitted to the practice of law in the State of Delaware,
and the opinion herein as to the DGCL is based upon the latest unofficial
compilation thereof available to me.
This opinion letter may be filed as an exhibit to the Registration
Statement. In giving this consent, I do not thereby admit that I come within
the category of persons whose consent is required under Section 7 of the Act or
the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ RICHARD A. PARR II
Richard A. Parr II
General Counsel
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CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or made a part of
this Registration Statement.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
March 3, 1998