<PAGE>
EXHIBIT 99.1
SAFE HARBOR COMPLIANCE STATEMENT
FOR FORWARD-LOOKING STATEMENTS
We intend to qualify both our written and oral forward-looking statements
for protection under Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended, and any other
similar safe harbor provisions.
Generally, forward-looking statements include expressed expectations of
future events and the assumptions on which the expressed expectations are based.
All forward-looking statements are inherently uncertain as they are based on
various expectations and assumptions concerning future events and they are
subject to numerous known and unknown risks and uncertainties which could cause
actual events or results to differ materially from those projected. Due to those
uncertainties and risks, the investment community is urged not to place undue
reliance on our written or oral forward-looking statements. We undertake no
obligation to update or revise this safe harbor compliance statement for
forward-looking statements to reflect future developments. In addition, we
undertake no obligation to update or revise forward-looking statements to
reflect changed assumptions, the occurrence of unanticipated events or changes
to future operating results over time.
We have provided the following risk factor disclosure in connection with
our continuing effort to qualify our written and oral forward-looking statements
for the protection of any safe harbor provision. Important factors currently
known to our management that could cause actual results to differ materially
from those in forward-looking statements include the disclosures contained in
the Annual Report on Form 10-K to which this statement is appended as an exhibit
and also include the following:
Risk Factors
------------
INTENSE COMPETITION COULD DAMAGE OUR SALES AND PROFITABILITY
If we are unable to compete successfully with providers of systems and
services similar to ours, we may lose significant revenue. We compete not only
with independent providers of similar systems and services, but also with
unrelated businesses' internal divisions that provide similar services. The
markets in which we offer our applications systems and services are highly
competitive with respect to functionality of products and services, price,
quality and innovation. Competition in the health care information services and
electronic commerce markets affects our ability to attract new customers and
keep existing ones, hire quality employees, and charge prices for our products
and services that will maximize our profitability. Some of our competitors have
greater access to capital, marketing and technological resources, and we cannot
guarantee that we will be able to compete successfully with them.
WE MAY LOSE CUSTOMERS OR REVENUE IF THE CURRENT TREND OF
CONSOLIDATION IN THE BANKING AND HEALTH CARE INDUSTRIES CONTINUES
<PAGE>
There has been and continues to be significant consolidation in the banking
and health care industries, which may reduce the number of customers for our
products and services and may reduce the price we are able to charge those
customers. We market our credit, charge and debit card transaction services
through several marketing channels, including banks. As a result of
consolidation, a bank that markets our financial services may be acquired by a
bank that competes with us directly or by a bank that has a relationship with
one or more of our competitors, eliminating the need for our services. In
addition, the consolidation of health care providers and other parts of the
health care industry may reduce the number of our potential customers for health
care information services. Finally, the increased purchasing power of larger
consolidated organizations in both industries could lead to reductions in the
amounts these organizations are willing to pay for our services. We cannot
predict the overall impact of consolidation in the banking and health care
industries, and it could have a material adverse effect on the Company's
business, financial condition and results of operations.
OUR PROFITABILITY MAY SUFFER IF WE ARE UNABLE TO CONTINUE OUR
EXPANSION IN NEW AND EXISTING MARKETS
Our future growth and profitability depends, in part, upon our continued
expansion within the electronic transaction processing and health care
information services markets in which we currently operate, the further
expansion of these markets, the emergence of other markets for electronic
transaction processing and health care information services and our ability to
penetrate these markets. As part of our strategy to expand into new and existing
markets, we seek acquisition opportunities and alliance relationships with other
businesses that will allow us to increase our market penetration, technological
capabilities, product offerings and distribution capabilities. We cannot
predict whether we will be able successfully to identify suitable acquisition
candidates in the future, or whether any acquisition will provide us with the
ability to expand into new markets.
Expansion of the health care information services and electronic
transaction processing markets is dependent upon the continued automation of
traditional paper-based processing systems and demand for new decision support
applications. Our ability to penetrate these markets depends upon our ability to
apply our existing technology, or to develop new technology, to meet the
particular service needs of each new or expanded market. We cannot guarantee
that markets for our services will continue to expand and develop, that we will
be successful in our efforts to meet the demands of these markets, or that we
will have adequate financial, marketing and technological resources to penetrate
new markets.
WE MAY INCUR ADDITIONAL COSTS OR LIABILITY AND LOSE REVENUE AS THE
RESULT OF GOVERNMENT REGULATION OR INVESTIGATION
Because we provide health care information services, future federal and
state health care legislation may restrict our existing operations, impose
additional requirements on us, or limit our expansion. We may not be able to
increase prices to cover the costs of complying with changes in government
regulations. Governments have recently focused significant attention on health
care reform; however, we cannot predict if any new legislation will be adopted.
-2-
<PAGE>
In addition, federal and state agencies have been conducting investigations
purportedly related to referral and billing practices of hospitals, laboratories
and similar institutions. The Office of the Inspector General and the Department
of Justice have initiated hospital laboratory billing review projects in certain
states and are expected to extend such projects to additional states, including
states in which we operate. Expansion of these projects increases the likelihood
of governmental investigations of hospitals, laboratories and other institutions
with which we do business. Although we currently monitor our billing practices
and arrangements with health care institutions to ensure compliance with
prevailing industry practices and applicable law, we cannot guarantee that
governmental investigators will not take positions that are inconsistent with
our practices.
The Department of Health and Human Services has proposed regulations under
Health Insurance Portability and Accountability Act of 1996 regarding the
maintenance and transmission of health information. These regulations establish
certain standards for electronic record keeping. We cannot predict whether these
regulations will be adopted in their present or a different form, if at all. We
may need to modify our current computer software and record-keeping practices to
comply with these regulations, if they are adopted. These modifications may
require substantial capital investment, and could have a significant effect on
our operations, financial condition, or business.
In order to remain competitive and satisfy the requirements and needs of
our clients, we must remain informed of and adapt to new regulations governing
the transmission, use and processing of personal information in electronic
commerce and over the Internet. While our business does not encompass the
solicitation or collection of personal information from the general public, our
card processing, check guarantee, network, merchant accounting and network
services all involve the handling, transmission, verification and processing of
personal information of the customers of our clients. As electronic commerce
and the Internet continue to evolve, we expect that federal, state and foreign
governments will adopt laws and regulations covering issues such as user
privacy, taxation of goods and services provided through e-commerce and over the
Internet, pricing, content and quality of products and services. The federal
government has already enacted broad legislation relating to user privacy in the
Gramm-Leach-Bliley Act of 2000, and regulations interpreting that Act are in the
process of being adopted. Further legislation and regulation could limit the
market for e-commerce, and therefore the market for our services. Although many
of these regulations may not apply directly to our business, we expect that laws
regulating the solicitation, collection or processing of personal or consumer
information could indirectly affect our business. In order for us to remain
competitive and profitable, we must stay abreast of the developments in this
area in order to ensure that we are in compliance with any such regulations, and
in order to assure our clients of that the use of our services will not
jeopardize their compliance with the same regulations. These efforts may
require the expenditure of significant sums in research and development and
investments in new technology and processes, and will require significant
attention from senior management.
WE MAY INCUR LIABILITY AND COSTS EXCEEDING OUR RESERVES FOR CREDIT
CARD CHARGES DISPUTED BY HOLDERS OF CREDIT AND DEBIT CARDS
In certain circumstances, we may be responsible for paying charges disputed
by holders of credit or debit cards where we have provided the service that
processed the credit or debit
-3-
<PAGE>
transaction. Generally, our direct merchant customers have liability for these
charges; however, in the case of merchant fraud, or insolvency or bankruptcy of
the merchant, we may be liable for the disputed charges. Based on our historical
loss experience, we have established reserves, which we believe to be adequate,
for estimated losses on these types of transactions, but we cannot guarantee the
adequacy of these reserves. Any losses in excess of reserves could have a
material adverse effect on our financial condition and results of operations.
RECENT AND FUTURE ACQUISITIONS MAY NOT BE PROFITABLE
We are currently devoting significant management resources and other
resources toward the integration of our recent acquisitions. We may not be able
to successfully integrate these acquisitions (or future acquisitions), and as a
result these recent acquisitions, and any future acquisitions, may negatively
impact our operating results, particularly during the fiscal quarters
immediately following the completion of the acquisition while integration is
occurring. Even if integration of acquired businesses occurs successfully,
recent and future acquisitions may not achieve levels of revenue growth,
profitability or productivity comparable with those achieved by our existing
operations, or otherwise perform as expected.
WE MAY NEED ADDITIONAL CAPITAL TO CONTINUE OUR GROWTH AND EXPANSION
We may incur indebtedness in the future, including through borrowings under
a credit facility, if a credit facility is available, to finance acquisitions.
As a result, we may be subject to risks associated with debt financing,
including increased interest rate expense, insufficient cash flow to meet
required payments on our debt and inability to refinance or repay the debt as it
comes due.
OUR ANTI-TAKEOVER PROVISIONS MAY LIMIT STOCKHOLDER VALUE
Certain provisions of our Certificate of Incorporation and By-laws, our
shareholder protection rights agreement, and Delaware law may delay, defer or
prevent a takeover attempt that a stockholder might consider in its best
interest. A stockholder may not receive as much in exchange for his or her
shares as they could without these provisions. The following is a description
of the provisions that may reduce the market prices for our shares of common
stock.
Our Certificate of incorporation and our By-laws separate our Board of
Directors into three classes of directors, with each class as nearly equal in
number as the total number of directors permits. Each class serves for three-
year terms, and each class' term expires in different successive years. In
addition, our Certificate of Incorporation authorizes the Board of Directors to
issue preferred stock in one or more classes or series and to determine the
price, rights, preferences, privileges and restrictions, including voting
rights, of those shares without any action on the part of the stockholders. The
rights of the holders of our common stock will be subject to, and may be
adversely affected by, the rights of the holders of any preferred stock that may
be issued in the future. The issuance of preferred stock, while providing
desirable flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of making it more difficult for a
third party to acquire a majority of our outstanding voting stock.
-4-
<PAGE>
Our stockholder rights plan entitles our common stockholders to purchase
preferred stock upon the happening of certain events. These rights will cause
substantial dilution to a person or group that attempts to acquire us on terms
not approved by our Board of Directors unless the offer contains certain
conditions.
In addition, Section 203 of the Delaware General Corporation Law prohibits
certain persons from engaging in business combinations, which may also have the
effect of delaying, deterring or preventing a change of control.
WE MAY SPEND SIGNIFICANT RESOURCES DEVELOPING AND PROMOTING NEW
PRODUCTS THAT MAY NOT BE PROFITABLE
The market for our products and services is characterized by rapid
technological change, frequent new product introductions, evolving industry
standards and changing customer needs. We cannot ensure that we will be
successful in developing and marketing new products and services or that our
products and services will adequately meet the quickly changing demands of our
customers. In addition, in order to meet our customers' demands, we are
continually involved in a number of development projects, including our effort
to update our core mainframe-based products for the health care information
services markets. Because we cannot predict the time and cost required in
reaching certain research, development and engineering objectives, product
development initiatives could cost significantly in excess of our estimates, and
project development schedules could require extensions. In either of these
events, our profitability and overall results of operations could be adversely
affected. We believe that the future success of our business will depend in
large part upon our ability to maintain and enhance our current product and
service offerings and to continually develop and introduce new products and
services that will keep pace with technological advances and satisfy evolving
customer requirements. Further, we cannot ensure that we will not experience
difficulties that could delay or prevent the successful development,
introduction and marketing of these products and services. An inability to
develop and introduce new products and services in a timely manner, or an
unsuccessful new or updated product could materially adversely affect our
financial condition and results of operations.
WE MAY EXPERIENCE VOLATILITY IN OUR STOCK PRICE
The market price of our common stock may experience significant volatility
from time to time. Such volatility may be affected by factors such as our
quarterly operating results or changes in the economy, financial markets or the
health care information and transaction processing industries, specifically, or
the health care and electronic commerce industries in general. In recent years,
the stock market has experienced extreme price and volume fluctuations which has
sometimes affected the market price of the securities issued by a particular
company which may be unrelated to the operational performance of the company.
This type of market effect could strike our common stock price as well. In
addition, we may be subject to securities class action litigation if the market
price of our stock experiences significant volatility. Our management's
attention and resources may be diverted from normal operations if we would
become subject to any securities class action, which may have a material adverse
effect on our business.
-5-
