<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [_]
Check the appropriate box:
[_] Preliminary proxy statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ALLSCRIPTS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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<PAGE>
[Allscripts, Inc. Logo]
2401 Commerce Drive
Libertyville, Illinois 60048
Telephone: (847) 680-3515
Facsimile: (847) 680-9887
April 21, 2000
Fellow Stockholders:
You are cordially invited to attend the Allscripts, Inc. Annual Meeting of
Stockholders on Wednesday, May 10, 2000 at 9:00 a.m. (Central Time), at LaSalle
Bank, 135 South LaSalle Street, Chicago, Illinois 60603, 43rd Floor, Room A.
This will be our first Annual Meeting as a public company and we are looking
forward to discussing our 1999 performance. This Notice of Annual Meeting and
Proxy Statement describes the business to be transacted at the meeting and
provides other information concerning Allscripts that you should be aware of
when you vote your shares. The principal business of the Annual Meeting will be
to elect three directors to each serve for a three-year term, to amend our
Certificate of Incorporation and to amend Allscripts' employee stock option
plan.
All stockholders are welcome to attend the Annual Meeting, but it is
important that your shares are represented at the Annual Meeting whether or not
you plan to attend. To ensure that you will be represented, we ask you to sign,
date and return the enclosed proxy card or proxy voting instruction form as
soon as possible. You may also be able to vote by telephone or the Internet and
if you are able to and choose to use one of those forms of voting, it is not
necessary for you to return your proxy card. In any event, please vote as soon
as possible.
On behalf of the Board of Directors and our management team, I would like to
express our appreciation for your interest in the affairs of Allscripts.
Sincerely,
Glen E. Tullman
Chairman and
Chief Executive Officer
<PAGE>
Allscripts, Inc.
2401 Commerce Drive
Libertyville, Illinois 60048
----------------
Notice of Annual Meeting of Stockholders
----------------
Wednesday, May 10, 2000
9:00 a.m.
LaSalle Bank
135 South LaSalle Street
Chicago, Illinois 60603
43rd Floor, Room A
The purpose of our Annual Meeting is to:
1. Elect three directors for three-year terms;
2. Amend our Certificate of Incorporation to increase the number of
authorized shares of common stock from 75,000,000 to 150,000,000; and
3. Amend our Amended and Restated 1993 Stock Incentive Plan to increase
the number of shares that we may issue under the Plan by 3,000,000
shares.
You can vote at the Annual Meeting in person or by proxy if you were a
stockholder of record on March 27, 2000. You may revoke your proxy at any time
prior to its exercise at the Annual Meeting.
We have enclosed with this notice and proxy statement a copy of our Annual
Report to Stockholders for the fiscal year ended December 31, 1999.
By Order of the Board of Directors,
John G. Cull
Senior Vice President, Finance,
Secretary and Treasurer
April 21, 2000
<PAGE>
Allscripts, Inc.
----------------
Proxy Statement
----------------
Table of Contents
<TABLE>
<CAPTION>
Page
----
<S> <C>
Questions and Answers...................................................... 1
Election of Directors...................................................... 3
Meetings and Committees of the Board of Directors.......................... 5
Director Compensation...................................................... 5
Ownership of Allscripts Common Stock....................................... 6
Section 16(a) Beneficial Ownership Reporting Compliance.................... 7
Executive Compensation..................................................... 7
Compensation Committee Report on Executive Officers' Compensation.......... 11
Company Performance........................................................ 14
Certain Relationships and Related Party Transactions....................... 15
Amendment of Certificate of Incorporation.................................. 16
Amendment of Amended and Restated 1993 Stock Incentive Plan................ 17
Independent Public Accountants............................................. 21
Executive Officers......................................................... 21
</TABLE>
Annual Report on Form 10-K
You may obtain a free copy of our Annual Report on Form 10-K for the year
ended December 31, 1999, including schedules, that is on file with the
Securities and Exchange Commission. Please contact J. Gregory Cull, Secretary,
Allscripts, Inc., 2401 Commerce Drive, Libertyville, Illinois 60048.
This proxy statement and form of proxy are first being sent to stockholders
on or about April 21, 2000.
<PAGE>
Questions and Answers
What am I voting on?
We are soliciting your vote on:
1. the election of three directors to each serve for a three-year term;
2. the amendment of our Certificate of Incorporation; and
3. the amendment of our Amended and Restated 1993 Stock Incentive Plan.
Who may vote?
Stockholders at the close of business on March 27, 2000 (the record date)
are entitled to vote. On that date, there were 26,212,138 shares of Allscripts
common stock outstanding.
How many votes do I have?
Each share of Allscripts common stock that you own entitles you to one vote.
How do I vote?
All stockholders may vote by mail. You also may be able to vote by telephone
or over the Internet. To vote by mail, please sign, date and mail your proxy in
the postage paid envelope provided. If you hold your shares through a bank or
broker and they do not offer telephone or Internet voting, please complete and
return your proxy by mail. If you attend the Annual Meeting in person and would
like to vote then, we will give you a ballot. If your shares are held in the
name of your broker, bank or other nominee, you need to bring an account
statement or letter from the nominee indicating that you were the beneficial
owner of the shares on March 27, 2000, the record date for voting.
How does discretionary voting authority apply?
If you sign, date and return your proxy card, your vote will be cast as you
direct. If you do not indicate how you want to vote, you give authority to Glen
E. Tullman and David B. Mullen to vote for the items discussed in these proxy
materials and any other matter that is properly raised at the Annual Meeting.
In such a case, your vote will be cast FOR the election of each director
nominee, FOR the amendment of our Certificate of Incorporation, FOR the
amendment of the Stock Incentive Plan and FOR or AGAINST any other properly
raised matters at the discretion of Messrs. Tullman and Mullen.
May I revoke my proxy?
You may revoke your proxy at any time before it is exercised in one of four
ways:
1. Notify our Secretary in writing before the Annual Meeting that you
are revoking your proxy.
2. Submit another proxy with a later date.
3. Vote by telephone or Internet after you have given your proxy.
4. Vote in person at the Annual Meeting.
<PAGE>
What does it mean if I receive more than one proxy card?
Your shares are likely registered differently or are in more than one
account. You should sign and return all proxy cards to guarantee that all of
your shares are voted.
What constitutes a quorum?
The presence, in person or by proxy, of the holders of one-third of the
total number of shares of Allscripts common stock issued and outstanding
constitutes a quorum. You will be considered part of the quorum if you return a
signed and dated proxy card, if you vote by telephone or Internet, or if you
attend the Annual Meeting.
Abstentions and broker non-votes are counted as "shares present" at the
Annual Meeting for purposes of determining whether a quorum exists. A broker
non-vote occurs when a broker submits a proxy that does not indicate a vote for
a proposal because he or she does not have voting authority and has not
received voting instructions from you.
What vote is required to approve each proposal?
Election of Directors: A majority of the shares present or represented by
proxy at the Annual Meeting must approve the election of the directors. If you
do not want to vote your shares for a particular nominee, you may indicate that
in the space provided on the proxy card or withhold authority as prompted
during telephone or Internet voting. Abstentions will have the effect of votes
against the election of the directors since they result in fewer votes for
approval, but broker non-votes will have no effect.
Amendment of Certificate of Incorporation: Amendment of our Certificate of
Incorporation requires that a majority of the shares of common stock
outstanding vote for the action. Abstentions and broker non-votes will have the
effect of votes against the amendment since they result in fewer votes for the
action.
Amendment of Stock Incentive Plan: Amendment of our Stock Incentive Plan
requires that a majority of the shares present or represented by proxy and
having the power to vote at the Annual Meeting vote in its favor. An abstention
will have the effect of a vote against the amendment of the Plan, but a broker
non-vote will have no effect.
How do I submit a stockholder proposal?
You must submit a proposal to be included in our proxy statement for the
2001 annual meeting of stockholders in writing no later than December 22, 2000.
Your proposal must comply with the proxy rules of the Securities and Exchange
Commission. You should send your proposal to our Secretary at our address on
the cover of this proxy statement.
You also may submit a proposal that you do not want included in the proxy
statement but that you want to raise at the 2001 annual meeting of
stockholders. We must receive your proposal in writing after December 11, 2000
but before January 10, 2001. If you submit your proposal after the deadline,
then Securities and Exchange Commission rules permit the individuals named in
the proxies solicited by Allscripts' Board of Directors for that meeting
2
<PAGE>
to exercise discretionary voting power as to that proposal. To be properly
brought before an annual meeting, our by-laws require that your proposal give:
(1) a brief description of the business you want to bring before the meeting;
(2) your name and address as they appear on our stock records; (3) the class
and number of shares of Allscripts that you beneficially own; and (4) any
interest you may have in the business you want to bring before the meeting. You
should send your proposal to our Secretary at the address on the cover of this
proxy statement.
How do I nominate a director?
If you wish to recommend a nominee for director for the 2001 annual meeting
of stockholders, our Secretary must receive your written nomination after
December 11, 2000 but before January 10, 2001. You should submit your proposal
to the Secretary at our address on the cover of this proxy statement. Our by-
laws require that you provide: (1) your name and address and the name and
address of the nominee; (2) a statement that the nominee is a record holder of
Allscripts common stock entitled to vote at the meeting and that you plan to
appear in person or by proxy at the meeting to make the nomination; (3) a
description of all arrangements or understandings under which you are making
the nominations; (4) any other information that the rules of the Securities and
Exchange Commission require to be included in a proxy statement; and (5) the
nominee's agreement to serve as a director if elected.
Who pays to prepare, mail and solicit the proxies?
We will pay all of the costs of preparing, mailing and soliciting these
proxies. We will ask brokers, banks, voting trustees and other nominees and
fiduciaries to forward the proxy materials to the beneficial owners of
Allscripts common stock and to obtain the authority to execute proxies. We will
reimburse them for their reasonable expenses upon request. In addition to
mailing proxy materials, our directors, officers and employees may solicit
proxies in person, by telephone or otherwise. These individuals will not be
specially compensated.
Election of Directors
Eight directors currently serve on our Board of Directors. The directors are
divided into three classes. At this Annual Meeting, you will be asked to elect
three directors. Each director will serve for a term of three years, until a
qualified successor director has been elected, or until he resigns or is
removed by the Board. The remaining five directors will continue to serve on
the Board as described below. The nominees, Philip D. Green, L. Ben Lytle and
Edward M. Philip, are currently Allscripts directors.
Your shares will be voted as you specify on the enclosed proxy card or in
telephone or Internet voting. If you do not specify how you want your shares
voted, we will vote them FOR the election of Messrs. Green, Lytle and Philip.
If unforeseen circumstances (such as death or disability) make it necessary for
the Board of Directors to substitute another person for a nominee, your shares
will be voted FOR that other person. The Board does not anticipate that any
nominee will be unable to serve. The nominees and continuing directors have
provided the following information about themselves.
3
<PAGE>
Nominees
Philip D. Green, 49, has been one of our directors since 1992. Mr. Green is
a founding partner of the Washington, D.C. based law firm of Green, Stewart,
Farber & Anderson, P.C., which was formed in 1989. From 1978 through 1989, Mr.
Green was a partner in the Washington, D.C. based law firm of Schwalb,
Donnenfeld, Bray & Silbert, P.C. Mr. Green practices healthcare law and
represents several major teaching hospitals.
L. Ben Lytle, 53, has been one of our directors since March 1999. He is
Chairman of the Board of Anthem, Inc., one of the largest healthcare management
companies in the United States. Before joining Anthem's predecessor company in
1976, he held positions with LTV Aerospace, Associates Corp. of North America
and American Fletcher National Bank. Mr. Lytle serves on the boards of IPALCO
Enterprises, Inc., an energy company; Central Newspapers, Inc., a media
company; CID Equity Partners, a venture capital firm; and Duke Realty
Investments, Inc., a real estate investment firm; and Xcare.net, Inc., an e-
commerce health care company.
Edward M. Philip, 34, has been one of our directors since July 1999. Mr.
Philip is Chief Operating Officer of Lycos, Inc., which he has been since
December 1996. He has been Chief Financial Officer and Secretary of Lycos, Inc.
since December 1995. From July 1991 to December 1995, Mr. Philip was employed
by The Walt Disney Company, where he served in various finance positions, most
recently as Vice President and Assistant Treasurer. Prior to joining The Walt
Disney Company, Mr. Philip was an investment banker at Salomon Brothers Inc.
Directors Continuing Until 2001 Annual Meeting
Michael J. Kluger, 43, has been one of our directors since 1994. He is a
founding partner of Liberty Partners, L.P., whose general partner is Liberty
Capital Partners, Inc., a New York investment management firm, where he has
served as a Managing Director since 1992. For five years prior thereto, Mr.
Kluger was a Director and Senior Vice President of Merrill Lynch Interfunding
Inc., a subsidiary of Merrill Lynch & Co., an investment banking and brokerage
firm. Mr. Kluger is also a managing director of Liberty Capital Partners, Inc.
Mr. Kluger serves on the Board of Directors of Monaco Coach Corporation.
David B. Mullen, 49, has been our President and Chief Financial Officer and
a director since August 1997. From January 1995 to June 1997, Mr. Mullen served
as Chief Financial Officer of Enterprise Systems, Inc. From 1983 to 1995, Mr.
Mullen was employed in various positions by CCC Information Services Group,
Inc., including Vice Chairman, President and Chief Financial Officer. Prior to
that, he was employed by Ernst & Young LLP.
Gary M. Stein, 32, has been one of our directors since April 1998. Mr. Stein
is a Vice President of Morgan Stanley Dean Witter & Co., an investment banking
firm, where he has been employed since 1997 and a Vice President of Morgan
Stanley Venture Partners III, L.L.C. Prior to joining Morgan Stanley Dean
Witter in 1997, Mr. Stein was an Associate at Patricof & Co. Ventures, Inc.,
where he focused on private equity investments in the healthcare industry from
1992 to 1997. Prior to that time, Mr. Stein was a Financial Analyst at Morgan
Stanley & Co., Inc. and Morgan Stanley Australia, Ltd.
4
<PAGE>
Directors Continuing Until 2002 Annual Meeting
M. Fazle Husain, 35, has been one of our directors since April 1998. Mr.
Husain is a Principal of Morgan Stanley Dean Witter & Co., an investment
banking firm, where he has been employed since 1991, and is a Managing Member
of Morgan Stanley Venture Partners III, L.L.C., the General Partner of Morgan
Stanley Venture Partners III, L.P., Morgan Stanley Venture Investors III, L.P.
and The Morgan Stanley Venture Partners Entrepreneur Fund, L.P. Mr. Husain was
also employed at Morgan Stanley Dean Witter from 1987 until 1989. Mr. Husain
focuses primarily on investments in the healthcare industry, including
healthcare services, medical devices and healthcare information technology. He
serves on the Boards of Directors of IntegraMed America, Inc. and Cardiac
Pathways Corporation.
Glen E. Tullman, 40, has been the Chairman of the Board since May 1999 and
our Chief Executive Officer since August 1997. From October 1994 to July 1997,
Mr. Tullman was Chief Executive Officer of Enterprise Systems, Inc., a publicly
traded healthcare information services company providing resource management
solutions to large integrated healthcare networks. From 1983 to 1994, Mr.
Tullman was employed by CCC Information Services Group, Inc., a computer
software company servicing the insurance industry, most recently as President
and Chief Operating Officer.
Meetings and Committees of the Board of Directors
The Board of Directors met seven times during 1999. In addition to meetings
of the full Board, directors attended meetings of Board committees. The Board
of Directors has standing audit and compensation committees. In 1999, each
director attended at least 75% of the meetings of the Board and of the
committees on which he served that were held during the period for which he was
a director.
The Audit Committee recommends the independent auditors to the Board and
oversees the accounting and audit functions of Allscripts. Philip D. Green, L.
Ben Lytle and Gary M. Stein are the members of the Audit Committee. Mr. Green
will not serve on the Committee after the date of the Annual Meeting. Mr.
Philip will replace Mr. Green on the Committee at the time of the Annual
Meeting. The Committee met two times during 1999.
The Compensation Committee determines executive officers' salaries, bonuses
and other compensation and administers the Stock Incentive Plan. M. Fazle
Husain, Michael J. Kluger and L. Ben Lytle are the members of the Compensation
Committee. The Committee met three times during 1999.
Director Compensation
Directors who are Allscripts employees or otherwise affiliates of Allscripts
receive no compensation for their services as directors. Our independent
directors receive a fee of $1,000 for each meeting of the Board of Directors
that they attend. We also reimburse them for their travel expenses. Under our
Stock Incentive Plan, these directors are eligible to
5
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receive stock option grants at the discretion of the Board of Directors or the
Compensation Committee. In 1999, Mr. Philip received an option to purchase
40,000 shares of our common stock at a per share exercise price of $12.6875.
The option vests one-third per year and becomes fully vested in 2002.
Ownership of Allscripts Common Stock
The following table shows how much Allscripts common stock was beneficially
owned as of March 15, 2000 by:
. our Chief Executive Officer and the four other most highly compensated
executive officers based on compensation earned during 1999;
. each director;
. each stockholder known by us to own beneficially more than 5% of
Allscripts common stock; and
. all directors and executive officers as a group.
Beneficial ownership is a technical term broadly defined by the Securities
and Exchange Commission to mean more than ownership in the usual sense. In
general, beneficial ownership includes any shares that the holder can vote or
transfer and stock options and warrants that are exercisable currently or
become exercisable within 60 days. These shares are considered to be
outstanding for the purpose of calculating the percentage of outstanding
Allscripts common stock owned by a particular stockholder, but are not
considered to be outstanding for the purpose of calculating the percentage
ownership of any other person. Percentage of ownership is based on 26,212,138
shares outstanding as of March 15, 2000. Except as otherwise noted, the
stockholders named in this table have sole voting and investment power for all
shares shown as beneficially owned by them.
<TABLE>
<CAPTION>
Options and
Shares of Warrants
Common Stock Exercisable
Named Executive Officers, Beneficially Within Percent
Directors and 5% Stockholders Owned 60 Days Total of Class
- ----------------------------- ------------ ----------- ---------- --------
<S> <C> <C> <C> <C>
Glen E. Tullman (1)............... 600,832 130,148 730,980 2.8
David B. Mullen................... 388,807 142,618 531,425 2.0
Steven M. Katz.................... 185,053 94,160 279,213 1.1
John G. Cull...................... 19,903 86,817 106,720 *
Joseph E. Carey................... 98,062 34,584 132,646 *
Philip D. Green................... 36,421 74,472 110,893 *
M. Fazle Husain (2)............... 5,254,063 -- 5,254,063 20.0
Michael J. Kluger (3)............. 3,248,170 -- 3,248,170 12.4
L. Ben Lytle...................... -- 8,333 8,333 *
Edward M. Philip.................. -- -- -- --
Gary M. Stein (2)................. 5,254,063 -- 5,254,063 20.0
Morgan Stanley Dean Witter & Co.
(2)............................. 5,254,063 -- 5,254,063 20.0
Liberty Partners Holdings 6,
L.L.C. (3)...................... 3,248,170 -- 3,248,170 12.4
All directors and executive
officers as a group (11
persons)........................ 9,831,311 571,132 10,402,443 38.8
</TABLE>
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*Less than 1%.
6
<PAGE>
(1) Mr. Tullman is a limited partner in The Morgan Stanley Venture
Partners Entrepreneur Fund, L.P., an affiliate of Morgan Stanley Dean
Witter & Co., and has an approximately 2.5% interest therein. His
interest does not constitute beneficial ownership of any of the shares
owned by this entity.
(2) Morgan Stanley Dean Witter & Co. is the sole shareholder of Morgan
Stanley Venture Partners III, Inc., which is the institutional
managing member of Morgan Stanley Venture Partners III, L.L.C. Mr.
Husain is a Managing Member of Morgan Stanley Venture Partners III,
L.L.C. and Mr. Stein is a Vice President. Except to the extent of his
proportionate interest therein, each of Messrs. Husain and Stein
disclaims beneficial ownership of the shares held beneficially by this
entity by virtue of it being the general partner of Morgan Stanley
Venture Partners III, L.P., which is the record owner of 4,611,499
shares, Morgan Stanley Venture Investors III, L.P., which is the
record owner of 442,914 shares and The Morgan Stanley Venture Partners
Entrepreneur Fund, L.P., which is the record owner of 199,650 shares.
The address for Messrs. Husain and Stein and these entities is c/o
Morgan Stanley Dean Witter Venture Partners, 1221 Avenue of the
Americas, New York, New York 10020.
(3) Mr. Kluger is a Managing Director of Liberty Capital Partners, Inc.,
an affiliate of Liberty Partners Holdings 6, L.L.C. Mr. Kluger
disclaims beneficial ownership of the shares held by Liberty Partners
Holdings 6, L.L.C., except to the extent of his proportionate interest
therein. The address for Mr. Kluger and Liberty Partners Holdings 6,
L.L.C. is c/o Liberty Partners, L.P., 1177 Avenue of the Americas, New
York, New York 10036.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires that
Allscripts' executive officers, directors and 10% stockholders file reports of
ownership and changes of ownership of Allscripts common stock with the
Securities and Exchange Commission. Based on a review of copies of these
reports provided to us and written representations from executive officers and
directors, we believe that all filing requirements were met during 1999, except
that the initial Form 4 reports for each of the officers and directors were
required to be amended.
Executive Compensation
This table summarizes the compensation for the Chief Executive Officer and
the other four most highly compensated executive officers of Allscripts. The
amount shown in the "all other compensation" column represents our matching
contributions under our 401(k) plan.
7
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Summary Compensation
<TABLE>
<CAPTION>
Long-Term
Compensation
------------
Annual
Compensation Awards
---------------- ------------
Securities
Name and Underlying All Other
Principal Position Year Salary Bonus Options Compensation
------------------ ---- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Glen E. Tullman............ 1999 $225,000 $12,500 -- $ 996
Chairman and Chief 1998 225,000 -- 548,083 498
Executive Officer
David B. Mullen............ 1999 $225,000 $12,500 -- $1,000
President and Chief 1998 225,000 -- 548,083 1,000
Financial Officer
Steven M. Katz............. 1999 $215,000 $12,500 -- --
Executive Vice President, 1998 215,000 -- 382,841 --
Sales and Marketing
John G. Cull............... 1999 $141,000 $35,000 4,166 $1,000
Senior Vice President, 1998 140,000 -- 19,164 1,000
Finance,
Secretary and Treasurer
Joseph E. Carey............ 1999 $134,583 $37,500(1) 69,166 --
Chief Operating Officer 1998 -- -- -- --
</TABLE>
- --------
(1) Includes a signing bonus of $25,000 awarded in April 1999 pursuant to the
terms of Mr. Carey's employment agreement.
Option Grants in 1999
This table gives information relating to option grants during 1999 to the
executive officers listed in the Summary Compensation Table. The options were
granted under our Amended and Restated 1993 Stock Incentive Plan. The potential
realizable value is calculated based on the term of the option at its time of
grant, 10 years. The calculation assumes that the fair market value on the date
of grant appreciates at the indicated rate compounded annually for the entire
term of the option and that the option is exercised at the exercise price and
sold on the last day of its term at the appreciated price. Stock price
appreciation of 0%, 5% and 10% is assumed pursuant to the rules of the
Securities and Exchange Commission. Based on the closing price of the common
stock on March 31, 2000 of $60.125 per share, the actual price appreciation may
be substantially greater than that assumed under these rules. We cannot assure
you that the actual stock price will appreciate over the 10-year option term at
the assumed levels or at any other defined level.
8
<PAGE>
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rates of
Stock Price Appreciation for
Individual Grants Option Term
------------------------------------------------- ----------------------------
Percent of Fair
Total Market
Securities Options Exercise Value
Underlying Granted to Price at
Options Employees Per Grant Expiration
Name Granted in 1999 Share Date Date 0% 5% 10%
- ---- ---------- ---------- -------- ------ ---------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Glen E. Tullman......... -- -- -- -- -- -- -- --
David B. Mullen......... -- -- -- -- -- -- -- --
Steven M. Katz.......... -- -- -- -- -- -- -- --
John G. Cull............ 4,166(1) 0.4% $3.00 $9.00 3/31/09 $ 24,996 $ 48,576 $ 84,752
Joseph E. Carey......... 69,166(2) 6.7 3.00 9.00 3/31/09 414,996 806,479 1,407,091
</TABLE>
- -------
(1) The option vests 25% on each of March 31, 2000, 2001, 2002 and 2003.
(2) The option vested 25% on October 11, 1999 and vests 25% on each of March
31, 2000, 2001 and 2002.
Option Exercises in 1999 and 1999 Year-End Option Values
This table provides information regarding the exercise of options during
1999 by the CEO and the other four most highly compensated executives. The
value realized is calculated using the difference between the option exercise
price and the price of Allscripts common stock on the date of exercise
multiplied by the number of shares subject to the option. For Messrs. Mullen
and Katz, the fair market value on the date of exercise has been deemed to be
$9.00 per share. The value of unexercised in-the-money options at year end 1999
is calculated using the difference between the option exercise price and $44.00
(the last reported market price of Allscripts common stock on December 31,
1999) multiplied by the number of shares underlying the option. An option is
in-the-money if the market value of the common stock subject to the option is
greater than the exercise price.
<TABLE>
<CAPTION>
Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options at
Shares Year End 1999 Year End 1999
Acquired Value ------------------------- -------------------------
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ---------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Glen E. Tullman......... -- -- 130,148 146,454 $5,718,703 $6,435,189
David B. Mullen......... 262,683 $2,348,386 137,703 142,129 6,050,670 6,245,148
Steven M. Katz.......... 185,053 1,654,374 94,160 100,794 4,137,390 4,428,888
John G. Cull............ 12,498 173,465 84,214 22,448 3,576,374 965,209
Joseph E. Carey......... -- -- 17,292 51,874 708,972 2,126,834
</TABLE>
Employment Agreements
We have entered into employment agreements with Messrs. Tullman and Mullen
effective August 1, 1997, with Mr. Katz effective September 2, 1997 and with
Mr. Carey effective August 2, 1999. Each agreement has an initial term ending
December 31, 2000 and renews for consecutive one-year
9
<PAGE>
terms unless either party gives 30 days' notice prior to the expiration of any
term. In 1999, Messrs. Tullman and Mullen were each paid an annual salary of
$225,000 and are each entitled to an annual bonus as determined by the Board of
Directors or the Compensation Committee. As of April 1, 2000, the annual salary
for Messrs. Tullman and Mullen was increased to $285,000. In 1999, Mr. Katz was
paid an annual salary of $215,000, and Mr. Carey was paid an annual salary of
$190,000 and was paid a signing bonus of $25,000. As of April 1, 2000, the
annual salary for Mr. Carey was increased to $215,000. Messrs. Katz and Carey
are each entitled to an annual bonus, contingent upon the attainment of certain
objectives, as determined by the Chief Executive Officer in consultation with
the Board of Directors or the Compensation Committee. The agreements also
provide that each of Messrs. Tullman, Mullen, Katz and Carey will not compete
with us during the term of his employment and for one year thereafter. If we
terminate any of Messrs. Tullman, Mullen, Katz or Carey without Cause or if any
of them terminates his employment For Good Reason, as each of those terms is
defined in the agreements, he will be entitled to 12 months' salary as
severance, as well as any salary that was accrued but not yet paid as of the
termination date, the unpaid performance bonus, if any, for the calendar year
preceding the termination date and any performance bonus for the calendar year
in which the termination date occurs that would have been payable had there
been no termination. The amount of these performance bonuses is to be
determined in the manner in which it would have been determined had there been
no termination.
Termination of Employment and Change in Control Agreements
We have entered into stock option agreements with each of Messrs. Tullman,
Mullen and Katz pursuant to their employment agreements granting them options
to purchase shares of our common stock as follows: Mr. Tullman, 548,083 shares;
Mr. Mullen, 548,083 shares; and Mr. Katz, 382,841 shares. Under the option
agreements, in the event of a Change of Control, as defined in the stock option
agreements, vesting of the options will accelerate so that the unvested portion
of the options will vest immediately. The option agreements also provide for
accelerated vesting of a portion of the options in the event of termination of
employment without Cause, For Good Reason or because of death or disability, as
each of those terms is defined in the employment agreements. In addition, we
have entered into a stock option agreement with Mr. Carey granting him options
to purchase 69,166 shares of common stock. Under this option agreement, in the
event of a Change in Control, as defined in the stock option agreement, vesting
of the options will accelerate so that the unvested portion of the options will
vest immediately.
Under an agreement entered into between us and Mr. Cull, if Mr. Cull is
discharged for any reason other than for Cause, as defined in the agreement, he
will be entitled to monthly payments equal to his then in-effect monthly salary
together with a pro rata bonus amount and a continuation of health insurance
benefits, for a period of 12 months. If, within six months of a Change in
Control of Allscripts, as defined in the agreement, Mr. Cull is discharged by
Allscripts other than for Cause or voluntarily terminates his employment
following a change in his position that materially reduces his level of
responsibilities or a material reduction in his overall level of compensation,
Mr. Cull will be entitled to monthly
10
<PAGE>
payments equal to his then in-effect monthly salary for a period of 12 months
together with a pro rata bonus amount and a continuation of health insurance
benefits. In addition, the agreement provides that all existing stock options
owned by Mr. Cull will immediately vest upon the occurrence of the same events
that require us to make severance payments to him following a Change in
Control. In addition, Mr. Cull has agreed not to compete with us for a period
of 12 months following the termination of his employment.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee of our Board of Directors are
Messrs. Husain, Kluger and Lytle. None of these persons has ever been an
officer or employee of Allscripts or any of its subsidiaries. We refer you to
the information under "Certain Relationships and Related Transactions" for a
discussion of insider participation.
Compensation Committee Report on Executive Officers' Compensation
The Compensation Committee of the Board of Directors is composed of three
independent non-employee directors, M. Fazle Husain, Michael J. Kluger and L.
Ben Lytle. Mr. Lytle serves as Chairman of the Committee. The Committee
determines executive officers' salaries, bonuses and other compensation and
administers the Stock Incentive Plan.
Compensation Policies Applicable to Executive Officers
The overall compensation program for salaried employees has been designed
and is administered to ensure that employee compensation promotes superior job
performance and the achievement of business objectives. The main policy
objective of executive officer compensation is the maximization of stockholder
value over the long term. The Compensation Committee believes that this can
best be accomplished by an executive compensation program that reflects the
following three principles:
First, base salaries should be sufficient to attract and retain
qualified management talent, without exceeding competitive practice at
similar companies in the information technology market.
Second, annual bonus and incentive programs should provide opportunity
for significant increases in compensation, based on meeting or exceeding
pre-determined company and individual performance targets.
Third, a substantial portion of total long-term compensation should
reflect performance on behalf of Allscripts' stockholders, as measured by
increases in the value of Allscripts' stock.
In the judgment of the Compensation Committee, the performance of Allscripts
in 1999 confirms that the compensation program is achieving its main
objectives.
Base Salary
All of Allscripts' executive officers but John G. Cull have employment
agreements that set their base compensation. At its February 4, 2000 meeting,
the Committee reviewed the compensation of Messrs. Tullman, Mullen and Carey
and increased their annual base salary, effective April 1, 2000, to $285,000,
$285,000 and $215,000, respectively.
11
<PAGE>
Annual Bonus
Executive officers and certain other key personnel of Allscripts are
eligible for cash bonuses after the end of each fiscal year. The bonus program
has not been formalized in writing. The Board of Directors or the Compensation
Committee determines bonuses for Mr. Tullman, the CEO, and Mr. Mullen, the
President and Chief Financial Officer. Bonuses are based on the overall
performance and financial results of Allscripts, including Allscripts'
achievement of goals pertaining to revenue growth, cost reductions, improved
operating methods, acquisitions and accounting controls. These factors are
weighted and then Allscripts' fulfillment of these goals is evaluated. Bonuses
for other executive officers are recommended by the CEO and then submitted to
the Committee for its approval. In making recommendations, the CEO determines
how each executive officer contributed to Allscripts' achievement of its goals.
Stock Incentives
Under the Stock Incentive Plan, stock options and stock appreciation rights
may be granted to Allscripts' executive officers. Executives generally receive
stock incentives through initial grants at the time of hire and periodic
additional grants. The Compensation Committee determines the number of stock
incentives to be granted based on an officer's job responsibilities and
individual performance evaluation. This approach is designed to encourage the
creation of long-term stockholder value as the Committee believes that the
significant equity interests in Allscripts held by management helps to align
the interests of stockholders and management and maximize stockholder returns
over the long term. In 1999, Messrs. Cull and Carey were the only executive
officers named in the Summary Compensation Table who received new grants of
stock incentives.
Compensation of the Chairman and Chief Executive Officer
The overall compensation package of the Chief Executive Officer is designed
to recognize that the Chief Executive Officer bears primary responsibility for
increasing the value of stockholders' investments. The Chief Executive
Officer's base compensation is set at $225,000 by his employment agreement,
which expires December 31, 2000. As noted above, Mr. Tullman's annual base
salary was increased to $285,000 effective April 1, 2000, and he received a
cash bonus of $12,500 for 1999, reflecting Allscripts' achievement of some of
its performance goals.
The Compensation Committee is directly responsible for determining all
awards and grants to the Chief Executive Officer under the incentive components
of the compensation program. While Mr. Tullman was not granted any stock
incentives in 1999, the Committee intends that a substantial portion of the
Chief Executive Officer's future compensation will be incentive-based,
providing greater compensation as direct and indirect financial measures of
stockholder value increase. The Chief Executive Officer's compensation will
thus be structured and administered to motivate and reward the successful
achievement of these objectives.
12
<PAGE>
The Committee intends for the Chief Executive Officer's compensation to
relate directly to the overall performance of Allscripts as measured by
financial criteria. In addition, the Chief Executive Officer's compensation
reflects achievements such as the continued strong performance of the senior
management team and the successful negotiation of acquisitions and strategic
alliances.
Deductibility of Compensation
Under, Internal Revenue Code Section 162(m), a company generally may not
deduct compensation in excess of $1,000,000 paid to the CEO and the other four
most highly compensated officers. Certain "performance based compensation" is
not included in compensation for purposes of the limit. The Committee believes
that the current structure of Allscripts' executive compensation does not give
rise to Section 162(m) concerns. The Compensation Committee will continue to
assess the impact of Section 162(m) on its compensation practices.
Compensation Committee
L. Ben Lytle, Chairman
M. Fazle Husain
Michael J. Kluger
13
<PAGE>
Company Performance
This graph shows a comparison of cumulative total returns for Allscripts,
the Nasdaq Stock Market-U.S. and the Nasdaq Health Services Index from July 23,
2000 (the date Allscripts common stock was first offered to the public at an
initial public offering price of $16.00 per share) through December 31, 1999.
The graph assumes an initial investment of $100 and the reinvestment of
dividends.
[Performance Graph]
Cumulative Total Return
<TABLE>
<CAPTION>
7/23/99 7/31/99 8/31/99 9/30/99 10/31/99 11/30/99 12/31/99
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Allscripts, Inc. $100.00 $100.00 $ 80.86 $ 99.22 $ 97.66 $225.78 $275.00
- --------------------------------------------------------------------------------------
Nasdaq Stock Market-U.S. 100.00 98.05 102.14 102.23 110.21 123.08 150.62
- --------------------------------------------------------------------------------------
Nasdaq Health Services 100.00 98.54 88.29 84.27 71.10 75.01 83.08
</TABLE>
14
<PAGE>
Certain Relationships and Related Party Transactions
Our policy is that all transactions between us and our executive officers,
directors and principal stockholders must be on terms no less favorable to us
than we could obtain from unaffiliated third parties or else must be approved
by our disinterested directors.
Shopping@Home Acquisition
In June 1999, we acquired substantially all of the assets of Shopping@Home,
Inc. in exchange for a promissory note in the principal amount of $650,000. We
repaid this note in August 1999. Messrs. Tullman and Carey were principal
shareholders of Shopping@Home.
Redeemable Preferred Stock Redemptions
We used a portion of the net proceeds of our initial public offering in July
1999 to redeem shares of preferred stock held by some of our affiliates
according to their redemption terms as follows, including accrued dividends:
. $10,468,581 to redeem 815,594 shares of Series H preferred stock and
439,883 shares of Series J preferred stock held by Liberty Partners
Holdings 6, L.L.C., with which Mr. Kluger is affiliated;
. $12,473,513 to redeem 217,459 shares of Series H preferred stock,
1,199,770 shares of Series I preferred stock and 268,204 shares of Series
J preferred stock held collectively by the Morgan Stanley Venture
Partners III, L.P., Morgan Stanley Venture Investors III, L.P. and The
Morgan Stanley Venture Partners Entrepreneur Fund, L.P., with which
Messrs. Husain and Stein are affiliated;
. $605,892 to redeem 18,929 shares of Series H preferred stock, 37,493
shares of Series I preferred stock and 23,345 shares of Series J
preferred stock held by Mr. Tullman;
. $245,780 to redeem 7,764 shares of Series H preferred stock, 14,997
shares of Series I preferred stock and 9,575 shares of Series J preferred
stock held by Mr. Mullen;
. $14,179 to redeem 796 shares of Series H preferred stock and 982 shares
of Series J preferred stock held by Mr. Cull;
. $189,992 to redeem 9,159 shares of Series H preferred stock, 3,749 shares
of Series I preferred stock and 11,295 shares of Series J preferred stock
held by Mr. Carey;
. $46,430 to redeem 796 shares of Series H preferred stock, 4,499 shares of
Series I preferred stock and 982 shares of Series J preferred stock held
by Mr. Rosenblum, a former executive officer of Allscripts; and
. $49,642 to redeem 2,787 shares of Series H preferred stock and 3,438
shares of Series J preferred stock held by Mr. Green.
Registration Rights Agreement
Liberty Partners Holdings 6, L.L.C., Morgan Stanley Venture Investors III,
L.P., Morgan Stanley Venture Partners III, L.P. and The Morgan Stanley Venture
Partners Entrepreneur Fund, L.P., which as of March 15, 2000 collectively held
approximately 8,500,000 shares of common stock, are entitled to registration
rights with respect to these shares. Under our Registration Agreement, these
Morgan Stanley entities, collectively, on the one hand, and Liberty Partners
Holdings 6, L.L.C., on the other hand, is each entitled to require us to
register their shares of common stock three times, but not more than once in
any six-month period. In addition, if we propose or are required to register
any of our common stock, either
15
<PAGE>
for our own account or for the account of other of our stockholders, we are
required to notify the holders described above and, subject to certain
limitations, to include in that registration all of the common stock requested
to be included by those holders. We are obligated to bear the expenses, other
than underwriting commissions, of the first registration required by Liberty or
the Morgan Stanley parties and of all incidental registrations.
Certain Business Relationships
In 1999, we retained the law firm of Green, Stewart, Farber & Anderson,
P.C., of which Mr. Green is a partner. We paid Mr. Green's law firm fees of
approximately $130,000 in 1999.
Prior to April 1999, we provided pharmacy benefit management services for
Anthem, Inc. Mr. Lytle is Chairman of the Board of Anthem. Revenue from Anthem
was approximately $375,000 in 1999 for these services.
Amendment of Certificate of Incorporation
The Board of Directors has approved the amendment of our Certificate of
Incorporation to increase the number of authorized shares of common stock that
we may issue from 75,000,000 shares to 150,000,000 shares. As of March 27,
2000, the record date, there were 26,212,138 shares of common stock issued and
outstanding, 45,796,555 shares unissued and not reserved for issuance,
2,899,709 shares unissued and reserved for issuance under our employee stock
option plan, 57,133 shares unissued and reserved for issuance upon exercise of
outstanding warrants and 34,465 shares in treasury.
We believe that the proposed increase in the number of authorized shares of
common stock will benefit Allscripts by improving our flexibility in responding
to future business needs and opportunities. The additional authorized shares
will be available for issuance from time to time in connection with, for
example, stock splits in the form of stock dividends, financings, acquisitions,
employee incentive plans and other corporate purposes that the Board determines
are appropriate. Other than our obligations under our stock option plan, with
respect to outstanding warrants and in connection with the April 2000,
acquisition of Master Chart, Inc., we have no arrangements, agreements,
understandings or plans for the issuance of the additional shares. Unless rules
of the Nasdaq Stock Market or laws or regulations applicable in particular
circumstances require further stockholder action, none is required to issue the
shares.
While we do not currently intend to issue shares of common stock in order to
make acquisition of control of Allscripts more difficult, future issuances of
common stock could have that effect. For example, our issuance of additional
shares might discourage the acquisition of shares by an entity attempting to
acquire control of Allscripts because the issuance would dilute the acquiring
entity's stock ownership. We could also issue shares to existing stockholders
as a dividend or privately place shares with purchasers who might side with the
Board in opposing a takeover bid. We are not aware of any current efforts to
accumulate our stock or to acquire control of Allscripts. This proposal is not
a part of any plan by our management to recommend a series of similar
amendments to the Board and the stockholders.
16
<PAGE>
Although we are not proposing to increase the number of authorized shares
for anti-takeover purposes, the securities rules require us to discuss the
provisions in our charter and bylaws that could have an anti-takeover effect.
Like many publicly held companies, our Certificate of Incorporation and Bylaws
contain the following provisions:
. our Board is divided into three classes of directors serving staggered
three-year terms;
. only a majority of the Board, the Chairman or the President may call
special stockholder meetings;
. our stockholders may not take action by written consent;
. to bring business before, or nominate directors at, an annual meeting,
stockholders must give timely written notice that meets requirements
stated in our bylaws;
. directors may be removed only for cause and only by the holders of at
least 80% of the outstanding shares of common stock; and
. in evaluating an acquisition proposal, the Board may consider subjective
factors, for example, the effects of the acquisition on employees,
suppliers, customers and the communities in which we are located.
The Board of Directors could use these provisions to place stock in friendly
hands, delay or deter or otherwise make a takeover of Allscripts more
difficult. While permitted under Delaware law, our stockholders do not have
cumulative voting rights.
Allscripts stockholders do not have preemptive rights to subscribe to
additional securities that we may issue, which means that current stockholders
do not have a prior right to purchase any new issue of Allscripts common stock
in order to maintain their proportionate ownership. Moreover, our issuance of
additional shares could have a dilutive effect on the earnings per share,
voting power and holdings of current stockholders.
In addition to common stock, our current Certificate of Incorporation
authorizes us to issue up to 1,000,000 shares of preferred stock, in series,
without further stockholder approval. As of the date of this proxy statement,
there were no shares of preferred stock outstanding.
If stockholders approve the amendment, it will become effective upon the
filing of a Certificate of Amendment in accordance with the General Corporation
Law of Delaware.
The Board of Directors unanimously recommends a vote FOR
the amendment of our Certificate of Incorporation.
Amendment of Amended and Restated 1993 Stock Incentive Plan
The Board of Directors has approved the amendment of the Amended and
Restated 1993 Stock Incentive Plan to increase the number of shares reserved
for issuance under the Plan from 4,393,489 to 7,393,489. The Board recommends
that you approve this amendment. The following summary describes the basic
features of the Plan, however, it is not complete and, therefore, you should
not rely solely on it for a detailed description of every aspect of the Plan.
17
<PAGE>
The Stock Option Plan Generally
The Board originally adopted the Plan on September 14, 1993. The Plan has
been amended from time to time since its initial adoption. The Plan will
terminate on June 7, 2009. Under the Plan, the Compensation Committee may grant
stock incentives to key individuals performing services for Allscripts,
including employees, officers, eligible directors, consultants and agents.
Awards under the Plan may be in the form of incentive stock options,
nonqualified stock options and stock appreciation rights.
Shares Available for the Plan
We presently have 4,393,489 shares of common stock reserved for issuance
under the Plan. The Board proposes to amend the Plan to increase the number of
shares that can be issued to 7,393,489. We believe that we need to increase the
number of shares issuable under the Plan in order to ensure that there are
adequate shares available for future grants to support broad-based
participation. The number of shares underlying awards made to any one
participant in a fiscal year may not exceed 3,000,000 shares. The number of
shares that can be issued and the number of shares subject to outstanding
options may be adjusted in the event of a stock split, stock dividend,
recapitalization or other similar event affecting the number of shares of
Allscripts' outstanding common stock. In that event, the Compensation Committee
may also make appropriate adjustments to any stock appreciation rights
outstanding under the Plan.
Plan Administration
The Compensation Committee administers the Plan. Subject to the specific
provisions of the Plan, the Committee determines award eligibility, timing and
the type, amount and terms of the awards. The Committee also interprets the
Plan, establishes rules and regulations under the Plan and makes all other
determinations necessary or advisable for the Plan's administration.
Stock Options
Options under the Plan may be either incentive stock options, as defined
under the tax laws, or nonqualified stock options. The per share exercise price
may not be less than the fair market value of Allscripts common stock on the
date the option is granted. The Compensation Committee may specify any period
of time following the date of grant during which options are exercisable, so
long as the exercise period is not more than 10 years. Incentive stock options
are subject to additional limitations relating to such things as employment
status, minimum exercise price, length of exercise period, maximum value of the
stock underlying the options and a required holding period for stock received
upon exercise of the option. Only nonqualified options may be granted to
individuals who are not Allscripts employees.
Upon exercise, the option holder may pay the exercise price in several ways.
He or she can pay: (1) in cash; (2) by delivering previously owned Allscripts
common stock with a fair market value equal to the exercise price; (3) by
surrendering stock appreciation rights for their cash value; (4) by directing
us to withhold shares of Allscripts common stock with a fair market value equal
to the exercise price; or (5) by a combination of these methods.
18
<PAGE>
Stock Appreciation Rights
A holder of a stock appreciation right, or SAR, has the right to receive
upon exercise of the SAR, in cash or in Allscripts common stock, the
appreciation in the fair market value of the number of shares of common stock
specified in the SAR. The Committee may grant SARs independently or in tandem
with options. If a SAR is granted in tandem with an option, the exercise of the
tandem option will result in a cancellation of the SAR and vice versa.
Expiration of Options and SARs
Generally, options and SARs granted under the Plan expire on the date
determined by the Committee at the time of the grant, subject to earlier
expiration as specified in the award agreement if the holder terminates
employment with Allscripts prior to that date. IRS rules require that incentive
stock options expire no later than three months after the termination of
employment for any reason other than death or disability, or one year after
termination of employment by reason of death or disability, in either case
subject to the normal expiration date of the option. In no event may an option
or SAR be exercised after its expiration date. Any unvested portion of an
option or SAR will expire immediately upon termination of employment.
Outstanding Options
We cannot determine the number of shares that may be acquired under stock
options that may be awarded under the Plan to participants. There are no stock
appreciation rights outstanding under the Plan. On March 27, 2000, the last
reported sale price of Allscripts common stock on the Nasdaq National Market
was $60.3125 per share. As of February 29, 2000, the following options had been
granted under the Plan:
<TABLE>
<CAPTION>
Name Number of Shares
- ---- ----------------
<S> <C>
Glen E. Tullman............................................. 598,083
Chairman and Chief Executive Officer
David B. Mullen............................................. 598,083
President and Chief Financial Officer
Steven M. Katz.............................................. 382,841
Executive Vice President, Sales and Marketing
John G. Cull................................................ 144,160
Senior Vice President, Finance, Secretary and Treasurer
Joseph E. Carey............................................. 141,666
Chief Operating Officer
Philip D. Green............................................. 85,571
Director Nominee
L. Ben Lytle................................................ 25,000
Director Nominee
Edward M. Philip............................................ 40,000
Director Nominee
All current executive officers.............................. 1,864,833
All current directors who are not executive officers........ 150,571
All employees (other than current executive officers)....... 3,429,021
</TABLE>
19
<PAGE>
Transferability
Generally, an option or SAR may not be sold, assigned or otherwise
transferred during its holder's lifetime, except by will or the laws of descent
and distribution. In certain limited circumstances, the Committee, in its sole
discretion, may provide that a nonqualified stock option or SAR may be
transferred, subject to the terms and conditions established by the Committee.
Tax Consequences
The following is a summary, based on current law, of some significant
federal income tax consequences of awards under the Plan. Participants are
advised to consult with their own tax advisor regarding the federal, state and
local tax consequences of the grant and exercise of an option or SAR.
Participants in the Plan do not recognize taxable income by reason of the
grant or vesting of an option or SAR, and Allscripts does not receive a tax
deduction by reason of either event. At exercise, the federal tax consequences
vary depending on whether the award is an incentive stock option, nonqualified
stock option or SAR.
Incentive Stock Options
Upon exercise of an incentive stock option, its holder does not recognize
taxable income, and Allscripts does not receive a tax deduction. However, the
excess of the fair market value of Allscripts common stock on the date of
exercise over the exercise price is an adjustment that increases alternative
minimum taxable income, the base upon which alternative minimum tax is
computed.
If the shares purchased upon the exercise of an incentive stock option are
sold at a gain within two years from the date of grant, or within one year
after the option is exercised, then the difference, with certain adjustments,
between the fair market value of the stock at the date of exercise and the
exercise price will be considered ordinary income. Any additional gain will be
treated as a capital gain. If the shares are sold at a gain after they have
been held at least one year and more than two years after the grant date, any
gain will be treated as a long-term capital gain. Any loss recognized upon a
taxable disposition of the shares generally would be characterized as a capital
loss.
Nonqualified Stock Options
Upon exercise of a nonqualified stock option, its holder recognizes ordinary
income in an amount equal to the difference between the fair market value of
Allscripts common stock at the time of exercise and the exercise price.
Generally, Allscripts is entitled to a corresponding tax deduction for
compensation income recognized by the holder. Upon the subsequent sale of the
shares acquired in the exercise, the holder will recognize a short-term or
long-term capital gain or loss, depending on the length of time he or she has
held the shares.
20
<PAGE>
Stock Appreciation Rights
Upon exercise of a SAR, the holder recognizes ordinary income in an amount
equal to the amount of the cash payment or fair market value of the shares of
Allscripts common stock he or she received. Generally, Allscripts is entitled
to a corresponding tax deduction.
Plan Amendment and Termination
The Plan will terminate on June 7, 2009. The Board of Directors may amend or
terminate the Plan at any time. An amendment is subject to shareholder approval
if it increases the number of shares available for issuance under the Plan,
permits the grant of an incentive stock option at an exercise price less than
that set forth in the Plan, changes the class of individuals eligible for
participation in the Plan, or permits the grant of awards after the Plan
termination date.
The Board of Directors unanimously recommends a vote FOR
the
amendment of the Amended and Restated 1993 Stock
Incentive Plan.
Independent Public Accountants
The Board has engaged PricewaterhouseCoopers LLP as our independent public
accountants for 2000. Representatives of PricewaterhouseCoopers will be present
at the Annual Meeting. They will have the opportunity to make a statement if
they so desire and to respond to appropriate questions.
Executive Officers
Following is certain information about the executive officers of Allscripts,
based on information furnished by them.
Glen E. Tullman, 40, has been the Chairman of the Board since May 1999 and
our Chief Executive Officer since August 1997. From October 1994 to July 1997,
Mr. Tullman was Chief Executive Officer of Enterprise Systems, Inc., a publicly
traded healthcare information services company providing resource management
solutions to large integrated healthcare networks. From 1983 to 1994, Mr.
Tullman was employed by CCC Information Services Group, Inc., a computer
software company servicing the insurance industry, most recently as President
and Chief Operating Officer.
David B. Mullen, 49, has been our President and Chief Financial Officer and
a director since August 1997. From January 1995 to June 1997, Mr. Mullen served
as Chief Financial Officer of Enterprise Systems, Inc. From 1983 to 1995, Mr.
Mullen was employed in various positions by CCC Information Services Group,
Inc., including Vice Chairman, President and Chief Financial Officer. Prior to
that, he was employed by Ernst & Young LLP.
Steven M. Katz, 50, has been our Executive Vice President, Sales and
Marketing since September 1997. From December 1994 to July 1997, Mr. Katz
served as Chief Operating
21
<PAGE>
Officer of Enterprise Systems, Inc. From December 1993 to November 1994, Mr.
Katz was employed by CCC Information Services Group, Inc. as President of its
Insurance Division.
John G. Cull, 38, has been our Senior Vice President, Finance, Secretary and
Treasurer since 1995. From 1991 to 1993, Mr. Cull was our assistant controller,
and from 1993 to 1995 he was our controller. From 1986 to 1991, Mr. Cull was
controller of Federated Foods, Inc., a food brokerage company. Prior to joining
Federated Foods, Mr. Cull was employed by Arthur Andersen & Co.
Joseph E. Carey, 42, has been our Chief Operating Officer since April 1999.
From September 1998 to April 1999, he served as President and Chief Operating
Officer of Shopping@Home, Inc. Prior to that time, he was Senior Vice President
and General Manager of the Resource Management Group of HBO & Company, a
healthcare software firm. Mr. Carey joined HBO in 1997 with HBO's acquisition
of Enterprise Systems, Inc., where he held the role of President from 1993
until the acquisition.
22
<PAGE>
[LOGO]
<PAGE>
APPENDIX A
AMENDMENT TO
ALLSCRIPTS, INC.
AMENDED AND RESTATED
1993 STOCK INCENTIVE PLAN
RESOLVED, that the second sentence of Section 2 is hereby deleted in its
entirety and replaced with the following:
"The maximum number of Common Shares to be issued pursuant to all
grants under this Plan shall be 7,393,489."
<PAGE>
ALLSCRIPTS, INC.
AMENDED AND RESTATED
1993 STOCK INCENTIVE PLAN
WHEREAS, on September 14, 1993, the Board of Directors of Allscripts, Inc.
(the "Company") approved the adoption of the Company's 1993 Stock Incentive Plan
(this "Plan" or the "1993 Plan");
WHEREAS, effective June 28, 1999 the Company effected a reverse split of
its common shares, $0.01 par value per share (the "Common Shares"), pursuant to
which each Common Share was converted into one-sixth of a Common Share (the
"Reverse Split");
WHEREAS, all references in this Plan to numbers of Common Shares shall
reflect the Reverse Split;
WHEREAS, the Company has adopted an Incentive Stock Option Plan (the
"Initial Option Plan"), a 1990 Stock Option Plan (the "1990 Plan"), a Consultant
Option Plan (the "Consultant Plan") and an Amended and Restated 1993 Eligible
Director Stock Option Plan (the "Director Plan") (the Initial Option Plan, 1990
Plan, Consultant Plan and Director Plan being collectively referred to herein as
the "Predecessor Plans").
WHEREAS, the Board of Directors adopted resolutions on June 7, 1999
approving an amendment and restatement of this Plan and pursuant to such
resolutions, the Company wishes to amend and restate the Plan to contain the
following terms:
1. Purpose. The purpose of this Plan is to provide a means whereby the
Company may, through the grant of stock incentives, including options to
purchase the Company's Common Shares and stock appreciation rights, to key
individuals who perform services for or on behalf of the Company (such as
employees, officers, Eligible Directors, consultants and agents of the Company),
attract and retain persons of ability as key individuals and motivate such
persons to exert their best efforts on behalf of the Company. "Eligible
Directors" shall be members of the Board of Directors of the Company who are not
employees or officers of the Company or of any other entity and who do not own
beneficially, or are not affiliated with an entity that owns beneficially 10% or
more of the Company's outstanding voting securities on the date when Stock
Incentives are to be granted to such persons under this Plan. The Plan
authorizes the grant to such key individuals of the Company of stock incentives
in the form of (a) incentive stock options ("ISOs") to purchase Common Shares of
the Company under Section 422 of the Internal Revenue Code of 1986, as amended
from time to time (the "Code"), (b) nonqualified stock options to purchase
Common Shares of the Company ("Nonqualified Options") and (c) stock appreciation
rights ("SARs") (ISOs, Nonqualified Options and SARs being referred to
collectively as "Stock Incentives").
2. Number of Shares Available Under Plan. Stock Incentives may be granted
by the Company from time to time to key individuals who perform services for or
on behalf of the Company (such recipients being hereafter referred to as
"grantees"). The maximum number of Common Shares to be issued pursuant to all
grants under this Plan shall be 4,393,489. The shares issued upon exercise of
Stock Incentives granted under this Plan may be authorized and unissued shares
or shares held by the Company in its treasury, or both. In the event of a
lapse, expiration, termination, forfeiture or cancellation of any Stock
Incentive granted under this Plan or any Predecessor Plan without the issuance
of shares, the shares subject to or reserved for such Stock Incentive may be
used again for new grants of
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Stock Incentives hereunder; provided that in no event may the number of Common
Shares issued hereunder exceed the total number of shares reserved for issuance.
Any Common Shares withheld or surrendered to pay withholding taxes pursuant to
Section 9 or withheld or surrendered in full or partial payment of the exercise
price of an ISO or Nonqualified Option pursuant to Section 5(e) and any Common
Shares covered by Stock Incentives which Stock Incentives are withheld or
surrendered to pay withholding taxes pursuant to Section 9 or withheld or
surrendered in full or partial payment of the exercise price of an ISO or
Nonqualified Option pursuant to Section 5(e) shall be added to the aggregate
Common Shares available for issuance. In no event shall the number of Common
Shares underlying Stock Incentives granted hereunder to any individual in any
twelve-month period exceed 3,000,000 Common Shares.
3. Administration. This Plan shall be administered by the Compensation
Committee (the "Committee") as appointed by the Board of Directors of the
Company (the "Board"). To the extent required to comply with Rule 16b-3 under
the Securities Exchange Act of 1934, each member of the Committee shall qualify
as a "non-employee director," as defined therein.
The Committee may interpret the Plan, prescribe, amend, and rescind any
rules and regulations necessary or appropriate for the administration of the
Plan, and make such other determinations and take such other action as it deems
necessary or advisable, except, as otherwise expressly reserved in the Plan to
the Board.
The Committee may employ such legal counsel, consultants and agents as it
may deem desirable for the administration of the Plan and may rely upon any
opinion received from any such counsel or consultant and any computation
received from any such consultant or agent.
No member or former member of the Committee shall be liable for any action
or determination made in good faith with respect to the Plan or any Stock
Incentive awarded under it. To the maximum extent permitted by applicable law,
each member or former member of the Committee shall be indemnified and held
harmless by the Company against any cost or expense (including counsel fees) or
liability (including any sum paid in settlement of a claim with the approval of
the Company) arising out of any act or omission to act in connection with the
Plan unless arising out of such member's or former member's own fraud or bad
faith. Such indemnification shall be in addition to any rights of
indemnification the members or former members may have as directors or under the
By-Laws of the Company.
4. Eligibility and Awards. The Committee shall, subject to the
limitations of the Plan, have full power and discretion to establish selection
guidelines; to select eligible persons for participation; and to determine the
form of grant, either in the form of ISOs, Non-qualified Options, SARs or
combinations thereof, the number of Common Shares subject to the grant, the fair
market value of the Common Shares, when necessary, the restriction and
forfeiture provisions relating to Common Shares, the time and conditions of
vesting or exercise, the conditions, if any, under which time of vesting or
exercise may be accelerated, the conditions, form, time, manner and terms of
payment of any award, and all other terms and conditions of the grant; provided,
however, that ISOs shall not be granted to any individual who is not an employee
of the Company.
5. Terms and Conditions of Stock Incentives. Each Stock Incentive granted
under the Plan shall be evidenced by an agreement, in form approved by the
Committee which shall be subject to the following express terms and conditions
and to such other terms and conditions as the Committee may deem appropriate:
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(a) Stock Incentive Period. Each Stock Incentive agreement shall
specify the period for which the Stock Incentive thereunder is granted
(which, in the case of ISOs, shall not exceed ten years from the date of
grant or, in the case of a grant to a person who owns, directly or
indirectly, within the meaning of Section 424(d) of the Code, stock
representing more than 10% of the voting power of all classes of stock of
the Company, shall not exceed five years from the date of grant) and shall
provide that the Stock Incentive shall expire at the end of such period.
(b) Grant Period. Consistent with paragraph 11, an ISO must be
granted within ten years of the date this amendment and restatement of this
Plan was adopted or the date this amendment and restatement of this Plan is
approved by the Shareholders of the Company, whichever is earlier.
(c) Exercise Price. The per share exercise price of each Stock
Incentive shall be determined by the Committee at the time any Stock
Incentive is granted, and, in the case of ISOs, shall not be less than the
fair market value (or if granted to a person who owns, directly or
indirectly, within the meaning of Section 424(d) of the Code, stock
representing more than 10% of the voting power of all classes of stock of
the Company, 110% of fair market value) (but in no event less than the par
value) of the Common Shares of the Company on the date the Stock Incentive
is granted. If the Company's Common Shares are actively traded or quoted
in an established market (such as a national securities exchange or the
National Association of Securities Dealers Automated Quotation System) the
fair market value of the Company's Common Shares shall be the price of the
Common Shares as of the close of the date the Stock Incentive is granted;
however, in all other cases the fair market value of the Company's Common
Shares shall be that value that the Committee shall have determined as the
fair market value in good faith and in its sole discretion.
(d) Exercise of Stock Incentive. No part of any Stock Incentive may
be exercised until the grantee shall have satisfied the conditions (e.g.,
such as remaining in the employ of the Company for a certain period of
time), if any, after the date on which the Stock Incentive is granted as
the Committee may specify in the Stock Incentive agreement. Subject in
each case to the provisions of paragraph (f) of this paragraph 5, any Stock
Incentive may be exercised, to the extent exercisable by its terms, at such
time or times as may be determined by the Committee.
(e) Payment of Purchase Price Upon Exercise of ISO or Nonqualified
Option. Upon the exercise of an ISO or Nonqualified Option, the purchase
price shall be paid in cash or, if the Stock Incentive agreement so
provides, (i) in Common Shares of the Company, valued at its fair market
value on the date of exercise, (ii) by surrender of other options for
Common Shares of the Company held by the grantee which have not expired,
with the surrender value being the amount by which the fair market value of
a Common Share on the date of exercise exceeds the exercise price of the
surrendered option(s), (iii) by surrender of SARs for their cash value, or
(iv) by any combination of the foregoing. Fair market value for purposes
of this paragraph (e) shall be determined as of the date of exercise
pursuant to the method described in paragraph (c) of this paragraph 5.
(f) Exercise in the Event of Death, Disability or Other Termination of
Employment. Subject to the limitations as to the exercisability of ISOs,
which are described in subparagraphs (1), (2) and (3) below, and the
remaining provisions of this Plan, the Committee,
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in its sole discretion, shall determine the provisions concerning the
exercisability of options to be included in each grantee's Stock Incentive
Agreement.
(1) If an ISO grantee dies, his ISO may be exercised, to the
extent that the grantee could have done so at the date of his death,
by the person or persons to whom the grantee's rights under the ISO
pass by will or applicable law, or if no such person has such right,
by his executors or administrators, at any time, or from time to time,
for up to one year after the date of the grantee's death (as the
Committee may specify in the Stock Incentive Agreement) but not later
than the expiration date specified in paragraph (a) of this paragraph
5 if sooner than one year.
(2) If an ISO grantee's employment with the Company shall
terminate because of his permanent disability, he may exercise his
ISO, to the extent that he could have done so at the date of his
termination, at any time, or from time to time, within one year of
such termination but not later than the expiration date specified in
paragraph (a) of this paragraph 5 if sooner than one year. For this
purpose, the term "permanent disability" means the permanent
incapacity of a grantee to perform the usual duties of his employment
by reason of physical or mental impairment. Permanent disability
shall be deemed to exist when so determined by the Committee based
upon a written opinion of a licensed physician who has been approved
by the Committee.
(3) If an ISO grantee's employment with the Company shall
terminate for any reason other than death or permanent disability, he
may exercise his ISO, to the extent that he could have done so at the
date of his termination, at any time, or from time to time, within
three months of the date of his termination but not later than the
expiration date specified in paragraph (a) of this paragraph 5 if
sooner than three months.
(g) Transferability. Except as provided in this Section 5(g), no
Stock Incentive may be assigned or otherwise transferred. Each Stock
Incentive granted under the Plan shall be transferable by will and by the
laws of descent and distribution. In addition, under such rules and
procedures as the Committee may establish and subject to the discretion of
the Committee, the grantee of a Stock Incentive (other than an ISO) may
transfer such Stock Incentive, provided that (i) the applicable Stock
Incentive Agreement expressly so permits and (ii) the grantee provides such
documentation or information concerning any such transfer or transferee as
the Committee may reasonably request. Any Stock Incentives held by any
transferees shall be subject to the same terms and conditions that applied
immediately prior to the transfer. No ISO may be assigned or otherwise
transferred in any manner.
(h) Dollar Limitation. No ISO may be granted under the Plan to any
employee if in the calendar year in which the ISO is first exercisable the
aggregate fair market value (determined as of the date of grant) of Common
Shares of the Company for which such employee has been granted ISOs which
first become exercisable in such calendar year exceeds $100,000. Any Stock
Incentive which violates the rules of this subparagraph (h) of this
paragraph 5 shall be deemed to be a Nonqualified Option rather than an ISO.
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(i) SAR's.
(1) A grantee of an SAR shall have the right to receive cash or
Common Shares having a fair market value equal to the appreciation in
market value of a stated number of Common Shares from the date of
grant, or in the case of an SAR granted in tandem with or by reference
to an ISO or Nonqualified Option granted simultaneously with or prior
to the grant of such SAR, from the date of grant of the related stock
option to the date of exercise.
(2) SARs may be granted in tandem with or with reference to a
related ISO or Nonqualified Option, in which event the grantee may
elect to exercise either the option or the SAR (as to the same Common
Shares subject to the option and the SAR), or the SAR may be granted
independently of a related stock option. The right shall be
exercisable not more than ten years after the date of grant if granted
in tandem with or with reference to an ISO.
(3) Upon exercise of an SAR, the grantee shall be paid the excess
of the then fair market value of the number of shares to which the SAR
relates over the fair market value of such number of shares at the
date of grant of the SAR or of the related stock option, as the case
may be. Such excess shall be paid in cash or in Common Shares having
a fair market value equal to such excess, or a combination thereof, as
the Committee shall determine.
(j) Other Provisions. Each Stock Incentive agreement shall contain
such terms and provisions as the Committee may determine to be necessary or
desirable.
(k) No Rights as a Shareholder. No grantee shall have any rights as a
shareholder with respect to any Common Shares subject to his Stock
Incentive prior to the date of issuance to him of a certificate or
certificates for such shares.
6. Adjustments in Event of Change in Common Shares. If during the term of
this Plan, there shall be any change in the Company's Common Shares through a
merger, consolidation, reorganization, recapitalization or otherwise, or if
there shall be a dividend on the Company's Common Shares, payable in Common
Shares, or if there shall be a stock split, combination or other change in the
Company's issued Common Shares, the Common Shares available under this Plan
shall be increased or decreased proportionately to give effect to such change in
the Common Shares and the Common Shares subject to then existing Stock
Incentives shall be proportionately adjusted so that upon the issuance of Common
Shares pursuant to such Stock Incentives, the person receiving such Common
Shares will receive the securities which would have been received if the
issuance of Common Shares pursuant to the Stock Incentives had occurred
immediately prior to such merger, consolidation, reorganization,
recapitalization, dividend, stock split, combination or other change. Each such
Stock Incentive shall be adjusted to nearest whole share, rounding downwards.
In no event shall any fractional share become subject to a Stock Incentive
issued hereunder.
7. Compliance with Other Laws and Regulations. The Plan, the grant and
exercise of Stock Incentives thereunder, and the obligation of the Company to
sell and deliver Common Shares under such Stock Incentives, shall be subject to
all applicable federal and state laws, rules and regulations and to such
approvals by any government or regulatory agency as may be required. If at any
time the Committee shall determine in its discretion that the listing,
registration or qualification of the shares
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covered by the Plan upon any national securities exchange or under any state or
federal law, or the consent or approval of any government regulatory body, is
necessary or desirable as a condition of, or in connection with, the sale or
purchase of shares under the Plan, no shares will be delivered unless and until
such listing, registration, qualification, consent or approval shall have been
effected or obtained, or otherwise provided for, free of any conditions not
acceptable to the Committee. If shares are not required to be registered, but
are exempt from registration, upon exercising all or any portion of a Stock
Incentive, the Company may require each grantee (or any person acting under
paragraph 5(f)), to represent that the shares are being acquired for investment
only and not with a view to their sale or distribution, and to make such other
representations deemed appropriate by counsel to the Company. Stock certificates
evidencing unregistered shares acquired upon exercise of Stock Incentives shall
bear any legend required by applicable state securities laws and a restrictive
legend substantially as follows:
The securities represented hereby have not been registered under the Securities
Act of 1933, as amended (the "Act"), and may not be transferred in the absence
of such registration or an opinion of counsel acceptable to the Company that
such transfer will not require registration under such Act.
8. No Rights to Continued Employment. The Plan and any Stock Incentive
granted under the Plan shall not confer upon any grantee any right with respect
to employment or the continuance of employment by the Company, nor shall they
affect in any way the right of the Company to terminate his relationship
(including his employment) at any time.
9. Withholding. The Committee in its discretion may cause to be made as a
condition precedent to the payment of any cash or stock, appropriate
arrangements for the withholding of any federal, state, local or foreign taxes.
10. Amendment, Suspension and Discontinuance. The Board may from time to
time amend, suspend or discontinue the Plan; provided, however, no action of the
Board may, without the approval of Shareholders (a) increase the number of
shares reserved for Stock Incentives pursuant to paragraph 2; (b) permit
granting of any ISO at any option price less than that determined in accordance
with paragraph 5(c); (c) change the eligibility of employees or class of persons
to receive the Stock Incentives (other than as described in paragraphs 1, 2 and
4); or (d) permit the granting of Stock Incentives after the termination date
provided for in paragraph 11.
11. Effective Date and Term. The Effective Date of the Plan shall be the
date of the approval of this amendment and restatement of the Plan by the
Shareholders of the Company within twelve months before or after this amendment
and restatement of the Plan is approved by the Company's Board of Directors.
This Plan shall terminate and no Stock Incentive shall be granted after the
expiration of the period of ten years from the date this amendment and
restatement of the Plan was adopted by the Board of Directors; provided that any
Stock Incentives previously granted may be exercised in accordance with their
terms.
12. The Plan shall be governed by and construed in accordance with the
laws of the State of Illinois.
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PROXY PROXY
ALLSCRIPTS, INC.
2401 Commerce Drive
Libertyville, Illinois 60048
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Glen E. Tullman and David B. Mullen and each
of them, as Proxies, each with power of substitution, and hereby authorizes
them to vote, as designated below, all shares of common stock of Allscripts,
Inc. held of record by the undersigned on March 27, 2000, at the annual
meeting of stockholders to be held on May 10, 2000, and any adjournment
thereof. If only one Proxy is present at the Meeting, then that one may
exercise the power of all the Proxies hereunder.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
(Continued and to be signed on reverse side.)
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ALLSCRIPTS, INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]
[ ]
This Proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. If no direction is made, this Proxy will be voted
FOR the election of all listed Directors and FOR Proposal 2 and 3.
1. ELECTION OF DIRECTORS--
Nominees: Philip D. Green, L. Ben Lytle, Edward M. Philip
For Withhold For All
All All Except
[_] [_] [_]
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.
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2. AMENDMENT OF CERTIFICATE OF INCORPORATION.
For Against Abstain
[_] [_] [_]
3. AMENDMENT OF AMENDED AND RESTATED 1993 STOCK INCENTIVE PLAN.
For Against Abstain
[_] [_] [_]
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
Dated: ___________ , 2000
Signature(s)_____________________________
_________________________________________
Please sign exactly as name appears
hereon. When shares are held by joint
tenants, both should sign. When signing
as attorney, executor, administrator,
trustee, or guardian, please give full
title as such. If a corporation, please
sign in full corporate name by President
or other authorized officer. If a
partnership, please sign in partnership
name by authorized person.
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. FOLD AND DETACH HERE .
YOUR VOTE IS IMPORTANT.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
