As filed with the Securities and Exchange Commission on April 26,
1999
Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________
CERNER CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 43-1196944
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2800 ROCKCREEK PARKWAY, SUITE 601, KANSAS CITY, MISSOURI 64117
(Address of Principal Executive Offices) (Zip Code)
_________________________
CERNER CORPORATION
EXECUTIVE STOCK PURCHASE PLAN
(Full title of the plan)
CLIFFORD W. ILLIG, 2800 ROCKCREEK PARKWAY, SUITE 601,
KANSAS CITY, MISSOURI 64117
(Name and address of agent for service)
(816) 221-1024
(Telephone number, including area code, of agent for service)
PLEASE SEND COPIES OF ALL CORRESPONDENCE TO:
CRAIG L. EVANS, ESQ.
STINSON, MAG & FIZZELL, P.C.
1201 WALNUT
KANSAS CITY, MISSOURI 64106
(816) 842-8600
______________________________
CALCULATION OF REGISTRATION FEE
PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE/1/ PRICE/1/ FEE
Common Stock,
$.01 par value 700,000(2) $14.125 $9,887,500 $772
/1/ Pursuant to Rule 457(h) of the Securities Act of 1933, and
solely for the purpose of calculating the amount of the
registration fee, the proposed maximum offering price per
share and proposed maximum aggregate offering price is based
on the average of the bid and asked prices of the Common
Stock on April 20, 1999 in the over-the-counter market as
quoted on the National Association of Securities Dealers
Automated Quotation National Market System.
/2/ The provisions of Rule 416 shall apply to this registration
statement and the number of shares registered on this
registration statement automatically shall increase or
decrease as a result of stock splits, stock dividends or
similar transactions.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with
the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") are incorporated herein
by reference: (i) the Registrant's Annual Report on Form 10-K for
the year ended December 31, 1998; and (ii) the description of the
Common Stock of the Registrant which is contained in the
Registrant's Registration Statement on Form 8-A (File No. 0-15386),
including any amendments or reports filed for the purpose
of updating such description.
All documents filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
subsequent to the date of this Registration Statement and prior
to the filing of a post-effective amendment which indicates that
all securities offered hereby have been sold or which deregisters
all securities offered hereby remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof
from the date of the filing of such reports and documents, except
in no event shall any information included in any such document
in response to Item 402(i), (k) or (l) of Regulation S-K be
deemed to constitute part of this Registration Statement.
Any statement contained herein or in a document
incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this
Registration Statement to the extent that a statement contained
in any subsequently filed document which is deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the shares of the Common Stock of the
Registrant registered pursuant to this Registration Statement
will be passed upon by Stinson, Mag & Fizzell, P.C., 1201 Walnut
Street, Kansas City, Missouri 64106. As of April 21, 1999,
attorneys of such law firm owned in the aggregate 50,892 shares
of Common Stock of the Registrant.
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Section 145 of the Delaware General Corporation Law
(the "DGCL") (i) gives Delaware corporations broad powers to
indemnify their present and former directors and officers and
those of other enterprises, as well as certain other persons,
against expenses, judgments, fines and settlement amounts
incurred by such directors, officers or other persons in defense
of any action, suit or proceeding to which they are made parties
by reason of being or having been a director, officer, employee
or agent of the corporation, or of another enterprise at the
request of the corporation, subject to specified conditions and
exclusions, (ii) gives such directors, officers or other persons
who are successful in the defense of any action, suit or
proceeding the right to be indemnified, and (iii) authorizes the
corporation to purchase and maintain directors' and officers'
liability insurance. The indemnification authorized by Section
145 of the DGCL is not exclusive of any other rights to which
those indemnified may be entitled under any bylaws, agreement,
vote of stockholders or disinterested directors, policy of
insurance or otherwise.
(b) Article Tenth of the Registrant's Restated Certificate
of Incorporation authorizes the Registrant to agree to indemnify
any of its directors, officers, employees or agents, and any
person who serves at the request of the Registrant as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, to the fullest extent
permitted by the laws of the state of Delaware; provided that the
Registrant is not permitted to indemnify any person from or on
account of such person's conduct which was finally adjudged to
have been knowingly fraudulent, deliberately dishonest or wilful
misconduct.
(c) In accordance with Section 102(b)(7) of the DGCL,
Article Tenth of the Registrant's Restated Certificate of
Incorporation contains a provision eliminating a director's
personal liability to the Registrant or its stockholders for
monetary damages for breach of fiduciary duty as a director to
the fullest extent permitted or authorized by the laws of the
state of Delaware. Section 102(b)(7) of the DGCL prohibits the
elimination or limitation of a director's liability (1) for any
breach of the director's duty of loyalty to the Registrant or its
stockholders, (2) for acts or omissions not in good faith or
which involve intentional misconduct or knowing violations of
law, (3) under Section 174 of the DGCL (relating to unlawful
dividend payments or stock redemptions or repurchases), or (4)
for any transaction from which the director derived an improper
personal benefit.
(d) Section 28 of the Registrant's Bylaws requires the
Registrant to indemnify any person (1) against all liabilities
and expenses actually and reasonably incurred by such person in
connection with any action, suit or proceeding (other than an
action by or in the right of the Registrant) or (2) against any
amounts paid in settlement and expenses actually and reasonably
incurred by such person in an action by or in the right of the
Registrant, in either case, by reason of the fact that such
person is or was serving as a director or officer of the
Registrant or as a director or officer of another enterprise at
the Registrant's request; provided that (a) such person must have
acted in good faith and in a manner such person reasonably
believed to be in or not opposed to the Registrant's best
interests and, with respect to any criminal action or proceeding,
<PAGE>
that such person must have had no reasonable cause to believe
such person's conduct was unlawful, and (b) the Registrant is not
required to indemnify or advance expenses to such person in
connection with an action, suit or proceeding initiated by such
person unless the initiation of such action, suit or proceeding
was authorized by the Registrant's Board of Directors. Said
Section 28 further provides that the Registrant shall not
indemnify any person for any liabilities or expenses incurred by
such person in connection with an action, suit or proceeding by
or in the right of the Registrant in respect of any claim, issue
or matter as to which such person shall have been adjudged to be
liable to the Registrant, unless and only to the extent that the
court in which the action, suit or proceeding is brought
determines that the person is entitled to such indemnity. If any
person serving as a director or officer of the Registrant or as a
director or officer of another enterprise at the Registrant's
request is successful on the merits or otherwise in defense of
any action, suit or proceeding referred to above, said Section 28
requires that the Registrant indemnify such person against
expenses actually and reasonably incurred by such person in
connection therewith. Prior to indemnifying a person pursuant to
Section 28 of the Registrant's Bylaws, the Registrant must
determine that such person has met the specified standard of
conduct required for indemnification unless ordered by a court
and except as otherwise provided by the immediately preceding
sentence. Such determination must be made by (y) a majority vote
of a quorum of the directors who were not party to the action,
suit or proceeding (or by independent legal counsel in a written
opinion if so directed by a quorum of disinterested directors or
if such a quorum is not obtainable), or (z) the stockholders. If
the determination is adverse to the person seeking to be
indemnified, such person may cause the determination to be made
by a court having jurisdiction over the Registrant. The
indemnification provided by Section 28 of the Registrant's Bylaws
is not exclusive of any other rights to which those seeking
indemnification may be entitled under any statute, the
Registrant's Restated Certificate of Incorporation, the
Registrant's Bylaws, any agreement, vote of stockholders or
disinterested directors, policy of insurance or otherwise, both
as to action in their official capacities and as to action in
other capacities while holding their respective offices.
(e) The Registrant has entered into indemnification
agreements with the Registrant's directors, Clifford W. Illig,
Neal L. Patterson, Michael E. Herman, Thomas A. McDonnell, Gerald
E. Bisbee, Jr., Thomas C. Tinstman, M.D. and John C. Danforth,
which, among other things, (a) confirm the present indemnity
permitted under the DGCL, (b) provide that, in addition, the
directors shall be indemnified to the fullest possible extent
permitted by law against all expenses (including attorneys'
fees), judgments, fines, and settlement amounts, paid or incurred
by them in any action or proceeding, including any action by or
in the right of the Registrant, on account of their services as a
director of the Registrant or as a director of any subsidiary of
the Registrant or as a director, officer, employee or agent of
any other company or enterprise when they are serving in such
capacities at the request of the Registrant, and (c) provide
procedures for notification and defense of a claim. However, no
indemnity will be provided to any director on account of conduct
which is adjudged to be knowingly fraudulent, deliberately
dishonest or wilful misconduct. The indemnification agreements
also provide that the Registrant will advance the expenses of
defending an action, lawsuit or other proceeding to the
indemnified director before <PAGE> the matter is disposed of if the
indemnitee agrees to repay any such advances to the Registrant if
it is later determined that he or she was not entitled to
indemnification.
(f) Section 28 of the Registrant's Bylaws permits the
Registrant to insure any person against any liability incurred by
such person by reason of the fact that such person is or was
serving as a director or officer of the Registrant or as a
director or officer of another enterprise at the Registrant's
request, whether or not the Registrant would have the power to
indemnify such person under the provisions described above. The
Registrant has obtained directors' and officers' liability
insurance for each of its directors and executive officers which
(subject to certain limits and deductibles) (i) insures such
persons against loss arising from certain claims made against
them by reason of such persons being a director or officer, and
(ii) insures the Registrant against loss which it may be required
or permitted to pay as indemnification due such persons for
certain claims. Such insurance may provide coverage for certain
matters as to which the Registrant may not be permitted by law to
provide indemnification.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
A list of the exhibits included as part of this
Registration Statement is set forth in the Exhibit Index which
immediately precedes such exhibits and is incorporated by
reference herein.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this
Registration Statement (or the most recent post-
effective amendment hereto) which, individually or in
the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration
Statement;
<PAGE>
Provided, however, that paragraphs (1)(i) and (1)(ii)
do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section
13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Registrant, the Registrant has
been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the
Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and
has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Kansas City, State of Missouri, on April 20, 1999.
CERNER CORPORATION
By: /S/ Neal L. Patterson
Neal L. Patterson
Chairman of the Board,
Chief Executive Officer
and President
Pursuant to the requirements of the Securities Act,
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
/s/ Neal L. Patterson Chairman of the Board, April 20, 1999
Neal L. Patterson Chief Executive Office
and President
(Principal Executive Officer)
/c/ Clifford W. Illig Vice Chairman and April 20, 1999
Clifford W. Illig Director
/s/ Marc G. Naughton (Principal Financial April 20, 1999
Marc G. Naughton and Accounting Officer)
/s/ Gerald E. Bisbee, Jr. Director April 20, 1999
Gerald E. Bisbee, Jr.
/s/ Michael E. Herman Director April 20, 1999
Michael E. Herman
/s/ Thomas C. Tinstman, M.D. Director April 20, 1999
Thomas C. Tinstman, M.D.
/s/ Thomas A. McDonnell Director April 20, 1999
Thomas A. McDonnell
/s/ John C. Danforth Director April 20, 1999
John C. Danforth
<PAGE>
EXHIBIT INDEX
Page
Number Description No.
4(a) Restated Certificate of Incorporation,
as amended through June 29, 1996 (filed
as Exhibit 3(i) to Registrant's
Quarterly Report on Form 10-Q for the
quarter ended June 29, 1996, and
incorporated herein by reference). *
4(b) Bylaws of Registrant, as amended (filed
as Exhibit 3 to Registrant's Quarterly
Report on Form 10-Q for the quarter
ended June 30, 1995, and incorporated
herein by reference). *
4(c) Amended and Restated Rights Agreement,
dated as of March 12, 1999, between
Cerner Corporation and UMB Bank, n.a.,
as Rights Agents, which includes the
Form of Certificate of Designation,
Preferences and Rights of Series A
Preferred Stock of Cerner Corporation,
as Exhibit A, and the Form of Rights
Certificate, as Exhibit B (filed as an
exhibit to Registrant's current report
on Form 8-A/A dated March 31, 1999 and
incorporated herein by reference). *
4(d) Specimen stock certificate (filed as
Exhibit 4(a) to Registrant's
Registration Statement on Form S-8 (File
No. 33-15156) and incorporated herein by
reference). *
4(e) Note Agreement between Cerner Corporation,
Principal Mutual Life Insurance Company,
and Principal National Life Insurance
Company dated July 1, 1994 (filed as
Exhibit 10(a) to Registrant's Quarterly
Report on Form 10-Q for the quarter
ended September 30, 1994, and
incorporated herein by reference). *
4(f) Credit Agreement between Cerner
Corporation and Mercantile Bank, dated
April 1, 1999 (filed as Exhibit 4(d) to
Registrant's Annual Report on Form 10-K
for the fiscal year ended January 2,
1999, and incorporated herein by
reference). *
4(g) Cerner Corporation Executive Stock
Purchase Plan.
4(h) Form of Stock Pledge Agreement for
Cerner Corporation Executive Stock
Purchase Plan.
4(i) Form of Promissory Note for Cerner
Corporation Executive Stock Purchase
Plan.
<PAGE>
5 Opinion of Stinson, Mag & Fizzell,
P.C., Counsel for the Registrant, with
respect to the legality of the Common
Stock of the Registrant registered
hereby.
23(a) Consent of Registrant's Independent
Accountants.
23(b) Consent of Registrant's Counsel
(contained in the Opinion of Counsel
filed as Exhibit 5). *
_______________________________
* Incorporated herein by reference.
CERNER CORPORATION
EXECUTIVE STOCK PURCHASE PLAN
ARTICLE I
PURPOSE
1.1 Purpose. The purpose of the Plan is to advance
the interests of the Company, the Company's senior management,
and the Company's shareholders by offering the Company's senior
management an incentive to purchase shares of the Company's stock
on the open market. The Plan is adopted, as follows, effective
April 23, 1999 (the "Effective Date").
ARTICLE II
DEFINITIONS
2.1 Certain Defined Terms. Whenever the following
terms are used in the Plan, they shall have the meanings
specified below unless the context clearly indicates to the
contrary:
(a) "Committee" means the Compensation Committee of
the Board of Directors of the Company.
(b) "Cause" means, unless otherwise defined in an
employment agreement between an Executive and the Company,
(i) willful and continued failure by an Executive to carry
out the reasonable and lawful policies and directives of the
Committee; (ii) willful engaging by an Executive in
misconduct which causes material injury to, or damages the
reputation of, the Company, as specified in a written notice
to an Executive from the Committee; (iii) any act of
dishonesty of an Executive; (iv) any commission by an
Executive of a criminal offense, other than a minor traffic
misdemeanor; (v) any use by an Executive of an illegal
controlled substance; or (vi) excessive absenteeism other
than for illness, after receiving a warning in writing from
the Committee to refrain from such behavior.
(c) "Change of Control" means any transaction or
closely related series of transactions under which (i) any
Person, closely affiliated group of Persons or entity, other
than those shareholders or lineal descendants of such
shareholders (or lineal <PAGE> descendants of beneficiaries of
trusts that are shareholders) of the Company on the date
hereof, shall acquire or succeed to the ownership or control
of 51% or more of all the issued and outstanding classes of
voting stock of the Company or (ii) there is a sale of all
or substantially all of the Company's assets.
(d) "Company" means Cerner Corporation, a Delaware
corporation, and any successor in interest by operation of law.
(e) "Date of Grant" means, with respect to any
Matching Option, the date such Matching Option is granted
under the Option Plan.
(f) "Executive" means a director, vice president or
key associate of the Company who, as determined by the
Committee, is eligible to participate in the Plan, provided
that Neal Patterson and Cliff Illig shall not be eligible to
participate in the Plan.
(g) "Matching Option" means an option to purchase
Shares granted under the Option Plan.
(h) "Option Plan" means the Cerner Corporation Stock
Option Plan D of the Company.
(i) "Person" means any individual, corporation,
partnership, limited liability company, joint stock company,
trust, joint venture, association, or other entity or
organization, including a government or political
subdivision or an agency or instrumentality thereof.
(j) "Plan" means this Cerner Corporation Executive
Stock Purchase Plan.
(k) "Plan Loan" means a loan given by the Company to
an Executive for a Stock Purchase pursuant to the terms of
this Plan.
(l) "Pledged Shares" means the Company's shares of
common stock, $.01 par value, other than Purchased Shares,
that are pledged as collateral for a Plan Loan.
(m) "Purchased Shares" means the Company's shares of
common stock, $.01 par value, which are purchased by the
Executive pursuant to Section 3.1 of the Plan and any
successor shares resulting from a merger, consolidation or
other reorganization. Purchased Shares do not include Pledged
Shares or those Shares that are purchased pursuant to the
exercise of a Matching Option.
<PAGE>
(n) "Stock Purchase" means any purchase of Purchased
Shares by an Executive pursuant to Section 3.1 of the Plan.
2.2 Pronouns and Titles. The singular pronoun shall
include the plural where the context so indicates. Titles are
provided in the Plan for convenience only and are not to serve as
a basis for definition, interpretation, or construction of the
Plan.
ARTICLE III
TERMS OF STOCK PURCHASES
3.1 Stock Purchase. An Executive may make a Stock
Purchase under this Plan at the times and on such conditions as
may be established by the Committee.
3.2 Financing. The Company may provide a Plan Loan
to an Executive to help finance the purchase price of a Stock
Purchase on such terms as may be approved by the Committee. Plan
Loans will only be made to Executives that elect to participate
in the Plan. All Plan Loans shall comply with all applicable laws,
including without limitation, the rules and regulations of the
Federal Reserve System. Unless modified by the Committee, the
specific additional Plan Loan terms are as follows:
(a) Loan Term. All Plan Loans will have a term of
five (5) years.
(b) Loan Interest. All Plan Loans will have a market
interest rate deemed reasonable and appropriate by the Committee
based on the applicable federal rate.
(c) Principal and Interest Repayments. Unless the
Executive terminates employment prior to full repayment of a
Plan Loan, Plan Loan principal and interest is not due until
the end of the five-year loan term. There is no pre-payment
penalty if the Plan Loan is repaid earlier than the
expiration of the five year term. Executives may also elect
to pay interest annually. If interest is not paid annually,
it will compound annually.
(d) Repayment upon Termination. In the event of an
Executive's termination of employment, Plan Loans shall be
repaid in accordance with the terms of Section 3.3 of the
Plan.
(e) Collateral. All Plan Loans will be secured by the
Purchased Shares and any Pledged Shares.
<PAGE>
3.3 One-Year Holding Period. Executives making a Stock
Purchase under the Plan shall not resell such Purchased Shares or
the Pledged Shares prior to the one-year anniversary of the date
of the Stock Purchase. After such one-year holding period has
expired, an Executive may resell such Purchased Shares or Pledged
Shares; provided, however, that all sale proceeds shall first be
used to repay any outstanding principal and interest owed on any
Plan Loan that was used to purchase the Purchased Shares.
3.4 Mandatory Plan Loan Repayment in Event of
Termination. In the event of an Executive's termination from
employment with the Company, the Executive shall repay any
outstanding principal and interest on any Plan Loan within the
following time period:
(a) 365 days if the Executive's termination of
employment is because of retirement, disability, or death;
(b) 180 days if the Executive's termination of
employment follows within 6 months of a Change of Control
of the Company and is because of any reason other than
termination for Cause;
(c) 90 days if the Executive's termination of
employment is for any reason other than retirement,
disability, death or Cause (and in the absence of a Change
of Control or after the time period set forth in (b)
immediately above); or
(d) immediately, if the Executive's termination of
employment is for Cause.
ARTICLE IV
ELIGIBILITY
4.1 Eligibility. No one other than an Executive shall
be eligible to receive a Plan Loan or be eligible to receive a
Matching Option under the Plan.
ARTICLE V
THE MATCHING OPTIONS
5.1 Granting of Matching Options for Purchased Shares.
At the time an Executive makes a Stock Purchase, the Committee
shall cause the grant to the Executive of a Matching Option to
purchase one (1) additional Share for each five (5) Shares
purchased in <PAGE> the Stock Purchase. Except to the extent provided
in this Article V, the terms of the Matching Option shall be in
accordance with the Option Plan.
5.2 Granting of Matching Options for Previously
Purchased Shares Pledged as Collateral. At the time an Executive
makes a Stock Purchase, in addition to any Matching Option
granted pursuant to Section 5.1, the Committee shall also cause
the grant to the Executive of a Matching Option to purchase one
(1) additional Share for each ten (10) Pledged Shares that are
pledged as collateral for the Plan Loan subject to limits established
by the Committee.
5.3 Exercise Price and Date of Grant. The per Share
exercise price of each Matching Option shall be the price paid by
the Executive for the purchase of Purchased Shares in the Stock
Purchase. The date of grant of such Matching Options shall be
the date the Executive purchased the Purchased Shares.
5.4 Exercise of Option.
(a) Period. Unless otherwise accelerated pursuant to
Section 5.4(b) of the Plan, and provided the Executive is
and has continuously been an associate of the Company since
the Matching Option's Date of Grant, each Matching Option
shall become exercisable on the seventh (7th) anniversary of
the Option's Date of Grant; provided, however, that
notwithstanding anything herein to the contrary, the period
during which each Matching Option may be exercised shall
expire no later than eight (8) years from the Matching
Option's Date of Grant.
(b) Acceleration. The exercisability of each Matching
Option granted under this Plan shall be accelerated
depending upon the percentage of Purchased Shares that are
owned and have been continuously owned by the Executive on
the first, second, third, fourth, and fifth anniversaries of
the Date of Grant for such Matching Option. Each Matching
Option shall become exercisable according to the following
schedule. Accelerated vesting percentages shall be
cumulative.
<PAGE>
Anniversary of Matching Accelerated Vesting of Matching Options
Option's Date of Grant (Maximum 20%) (% of Purchase Shares currently
owned / required percentage expressed as a
decimal times .20)
1 (Actual % / 1.0) x .20
2 (Actual % / 0.8) x .20
3 (Actual % / 0.7) x .20
4 (Actual % / 0.6) x .20
5 (Actual % / 0.5) x .20
ARTICLE VI
ADMINISTRATION
6.1 Duties and Powers of Committee. The Plan shall be
administered by the Committee. The Committee shall have full
power and authority to construe, interpret, amend, terminate, grant
waivers and administer the Plan, and may from time to time adopt
such rules and regulations for carrying out the Plan as it may deem
proper and in the best interests of the Company. Any such
interpretations and rules shall be consistent with the basic
purpose of the Plan to allow for the purchase of Company stock
and the grant of Matching Options. The interpretation and
construction of the Plan by the Committee shall be final,
conclusive and binding upon all Persons. No member of the
Committee shall be personally liable for any action,
determination or interpretation made in good faith with respect
to the Plan, any Stock Purchase or any Matching Option.
6.2 Expenses; Indemnification. All reasonable
expenses and liabilities actually incurred in connection with the
administration of the Plan shall be borne by the Company. The
Committee may employ attorneys, consultants, accountants,
appraisers, brokers or other Persons. The Company and its
officers and directors shall be fully justified in relying, or
acting in good faith upon the advice, opinion, valuations or
information furnished by such Persons. All actions taken and all
interpretations and determinations made by the Committee in good
faith shall be final and binding upon all Executives, the Company
and all other interested Persons.
<PAGE>
ARTICLE VII
MISCELLANEOUS
7.1 Effect of Plan Upon Other Compensation Plans.
Nothing in the Plan shall be construed to limit the right of the
Company to establish any other forms of incentive or other
compensation for the Executives.
7.2 No Obligation to Exercise. The granting of a
Matching Option shall impose no obligation upon the Executive to
exercise such Option.
7.3 Effect of Plan Upon Employment. Nothing in the
Plan shall be construed as an obligation on the part of the
Company to continue the employment of any Executive for any
period.
7.4 Notice. Any notice required to be given under the
terms of this Plan shall be addressed to the Company in care of
its Secretary at its offices at 2800 Rock Creek Parkway, Kansas
City, MO 64117, and any notice to be given to an Executive shall
be addressed to him or her at the address then on file with the
Company. Any notice pursuant to this Plan shall be deemed to
have been duly given if and when addressed as aforesaid,
registered and deposited, postage and registry fee prepaid, in a
post office regularly maintained by the United States Government.
7.5 Governing Law. The Plan and the rights of all
persons claiming hereunder shall be construed and determined in
accordance with the laws of the State of Delaware.
Dated: April 23, 1999
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (the "Agreement") is made
and entered into on this ______ day of _________________,_______,
by and between ______________________________ (the "Pledgor"),
and Cerner Corporation, a Delaware corporation (the "Pledgee").
WITNESSETH:
WHEREAS, the Pledgor is the owner of
shares of the common stock of Pledgee,(the "Pledged Shares");
and
WHEREAS, pursuant to the terms of the Cerner
Corporation Executive Stock Purchase Plan (the "Stock Purchase
Plan"), the Pledgor has been offered the opportunity to purchase
certain shares of Pledgee; and
WHEREAS, in accordance with the terms of the Stock
Purchase Plan, the Pledgor has executed a promissory note payable
to the Pledgee, dated , (together with
all renewals and extensions thereof, the "Note"), as
consideration for a loan received from the Pledgee in the
principal amount of _______________ Dollars ($_________); and
WHEREAS, the Pledgor desires to secure the repayment of
the Note by the pledge of the Pledged Shares upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and
the mutual promises and agreements herein contained, the Pledgor
and Pledgee hereby agree as follows:
1. Pledge. As security for the due and punctual
payment of all amounts due and payable pursuant to the Note,
together with accrued interest thereon, the Pledgor hereby
pledges, hypothecates, assigns, transfers, sets over and grants
to the Pledgee, its successors and assigns a security interest in
and lien upon all of the Pledgor's right, title and interest in
and to the Pledged Shares and any account in which such Pledged
Shares are held. Unless otherwise agreed to by the parties hereto,
the Pledgor shall deliver to the Pledgee a stock certificate
evidencing all of the Pledged Shares, together with attached stock
powers duly endorsed in blank. Said certificates and the Pledged
Shares shall be held and disposed of by the Pledgee in accordance
with the terms and conditions of this Agreement. The Pledgee is
hereby authorized with respect to the Pledged Shares, whether or
not there has been any default in the payment or the performance
of any obligation secured by the Pledged Shares, to indorse the
Pledged Shares in the name of the Pledgor and cause any part or
all of the Pledged Shares to be transferred of record into the
Pledgee's name or the name of its nominee. During the term of
the pledge made hereunder, any proceeds or additional shares of
stock, rights, warrants, securities or other property issued or
distributed upon or in respect of any of the Pledged Shares, <PAGE>
including any and all such property issued or distributed as the
result of any stock dividends, stock splits, reverse stock splits,
recapitalizations, reorganizations, exchanges or substitutions or
other distribution, whether in liquidation or otherwise, shall be
immediately pledged, delivered, paid and set over by the Pledgor
to the Pledgee hereunder as additional collateral and shall
constitute Pledged Shares for purposes of this Agreement.
Pledgor's delivery of such additional shares of stock, rights,
warrants, securities and other property shall be deemed to
constitute the delivery and pledge thereof to the Pledgee
pursuant to this Agreement.
2. Representations, Warranties and Covenants. The
Pledgor represents, warrants and agrees as follows:
(a) The Pledgor has the unrestricted right, power
and authority to execute this Agreement, to perform the
Pledgor's obligations hereunder and to transfer and
create a security interest in the Pledged Shares in the
manner and for the purpose contemplated hereby.
(b) The pledge and delivery of the Pledged Shares
pursuant to this Agreement create a valid and perfected
first priority security interest in the Pledged Shares
in favor of the Pledgee.
3. Events of Default. The occurrence of any one or
more of the following events shall constitute a default hereunder
(each an "Event of Default"):
(a) the Pledgor's default in the payment of the
Note when due, by acceleration or otherwise, or in
performance of any of the terms, agreements or
covenants of this Agreement, the Note or the Stock
Purchase Plan; or
(b) any representation or warranty made by the
Pledgor in this Agreement or in the Note, or any other
representation or warranty made or furnished to the
Pledgee by or on behalf of the Pledgor, proves to have
been incorrect in any material respect when made and
remains material and uncured at the time in question;
or
(c) the making of any general assignment for the
benefit of creditors by the Pledgor or the commencement
by the Pledgor of a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or
hereafter in effect; or
(d) the appointment of a receiver, trustee or
other similar official for all or substantially all of
the Pledgor's property or assets, or the filing of a
<PAGE>
bankruptcy petition against the Pledgor in a court of
competent jurisdiction that commences an involuntary
case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, which
appointment or petition is not contested by the
Pledgor, or which appointment or petition is not
removed or dismissed within sixty (60) days.
4. Dividends and Voting Rights. So long as no Event
of Default shall have occurred and be continuing, the Pledgor
shall be entitled (a) to receive any and all cash dividends
declared and paid in respect of the Pledged Shares (other than
liquidating dividends) and (b) to exercise any and all voting and
other consensual rights in respect thereof. So long as no Event
of Default shall have occurred and be continuing, if the Pledged
Shares or any part thereof shall have been transferred into the
name of the Pledgee or its nominee, upon the written request of
the Pledgor, the Pledgee or its nominee shall execute and deliver
to the Pledgor appropriate powers of attorney or proxies to vote
the Pledged Shares.
5. The Pledgee's Remedies Upon Default.
(a) If any Event of Default shall have occurred
and be continuing, the Pledgee may do any one or more
of the following in such order as it may elect:
(i) cause any or all of the Pledged Shares
to be transferred into its name or that of its
nominee and obtain registration of such transfer
or transfers, without thereby effecting a
foreclosure of the pledge evidenced hereby or
relieving itself of its obligations under Part 5
of Article Nine of the Uniform Commercial Code as
enacted in the State of Missouri, the Pledgor
hereby irrevocably constituting and appointing the
Pledgee and any nominee of the Pledgee the
attorney-in-fact of the Pledgor for such purpose,
with full power of substitution;
(ii) vote any or all of the Pledged Shares or
revoke any or all proxies or powers of attorney
given by the Pledgor and give any or all consents,
waivers and ratifications in respect thereof and
otherwise act with respect thereto as though it
were the outright owner thereof, the Pledgor
hereby irrevocably constituting and appointing the
Pledgee and any nominee of the Pledgee the proxy
and attorney-in-fact of the Pledgor for such
purpose, with full power of substitution;
(iii) receive all dividends and all other
distributions of any kind on any or all of the
Pledged Shares; and
<PAGE>
(iv) sell, assign and deliver, at any time or
from time to time, in one or more lots, any or all
of the Pledged Shares, at any private or public
sale, for cash, for credit or for other property,
for immediate or future delivery, and for such
price or prices and on such terms as the Pledgee,
in its sole discretion, may determine, the Pledgor
hereby waiving and releasing any and all rights or
equity of redemption which it otherwise might have
either before or after sale hereunder. Any
notification required by law to be given in
connection with any sale shall conclusively be
deemed reasonable if given not less than ten (10)
days prior to the time of any public sale or the
time after which any private sale is to be made.
The Pledgee, if permitted by law, may bid for and
purchase all or any part of the Pledged Shares so
sold free from any such right or equity of
redemption. For the purpose hereof, any agreement
to sell all or any part of the Pledged Shares
shall be treated as a sale thereof, the Pledgee
shall be free to carry out such sale pursuant to
such agreement and the Pledgor shall not be
entitled to the return of any of the Pledged
Shares subject thereto, notwithstanding that,
subsequent to the Pledgee's entering into such an
agreement, the Pledgor may have cured all Events
of Default.
(b) The proceeds of any sale hereunder of the
Pledged Shares and any moneys held by the Pledgee
pursuant to this Agreement shall be applied first to
the payment of all costs and expenses of collection,
sale and delivery, including reasonable attorneys' fees
and expenses in connection therewith, whether or not
involving a case or proceeding before a federal or
state court, and next to such of the obligations of the
Pledgor to the Pledgee secured hereby in such order as
the Pledgee may in its sole discretion determine. The
balance, if any, of such proceeds and moneys shall be
paid to the Pledgor or such other person or persons as
may legally be entitled thereto. If the proceeds of
such sale are insufficient to pay such costs and
expenses and to satisfy such obligations of the
Pledgor, the Pledgor shall remain liable for such
deficiency.
6. Other Rights and Remedies. The rights and remedies
afforded to the Pledgee hereunder shall be cumulative and in
addition to and not in limitation of any rights and remedies
which the Pledgee may have under applicable law, including the
Uniform Commercial Code. The exercise or partial exercise of any
right or remedy of the Pledgee hereunder or under applicable law
shall not preclude or prejudice the further exercise of that
right or remedy or the exercise of any other right or remedy of
the Pledgee.
7. Waiver. No delay or omission on the part of the
Pledgee in exercising any right hereunder shall operate as a
waiver of such right or any other right hereunder or under any
<PAGE>
instrument or agreement evidencing or relating to any of the
obligations secured hereby. A waiver on any one occasion shall
not be construed as a bar or waiver of any right or remedy on any
future occasion.
8. Return of Pledged Shares. Promptly following the
receipt by the Pledgee of payment in full of the Note in
accordance with its terms, the Pledgee will, upon written demand
by the Pledgor, cause the Pledged Shares, any stock powers
related thereto and any other collateral held pursuant to this
Agreement, to be redelivered to the Pledgor without recourse to
the Pledgee.
9. Reasonable Care. The Pledgee shall be deemed to
have exercised reasonable care in the custody and preservation of
the Pledged Shares in its possession if the Pledged Shares are
accorded treatment substantially the same as that which the
Pledgee accords its own property; provided, however, that the
Pledgee shall have no obligation to (a) ascertain or take action
with respect to calls, conversions, exchanges, maturities,
tenders or other matters relative to any Pledged Shares, whether
or not the Pledgee has or is deemed to have knowledge of such
matters, or (b) take any necessary steps to preserve rights
against any other parties with respect to any Pledged Shares.
10. Notices. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall
be deemed to have been duly given on the date of service if
personally served on the party to whom such communication is to
be given, or on the third day after mailing if mailed to the
party to whom such communication is to be given by first class
mail, postage prepaid, and properly addressed as follows:
The Pledgor:
___________________________________
____________________________________
____________________________________
The Pledgee:
Attn: Chief Financial Officer
Cerner Corporation.
2800 RockCreek Parkway
Kansas City, MO 64117
11. Expenses. The Pledgor will upon demand pay to the
Pledgee the amount of any and all reasonable expenses, including
the reasonable fees and expenses of its counsel and of any
experts and agents, whether or not involving a case or proceeding
before any federal or state court, that the Pledgee may incur in
connection with (a) the administration of <PAGE> this Agreement, (b) the
custody or preservation of, or the sale of, collection from or
other realization upon, any of the Pledged Shares, (c) the
exercise or enforcement of any of the rights of the Pledgee
hereunder, or (d) the failure by the Pledgor to perform or
observe any of the provisions hereof.
12. Binding. This Agreement and all of the provisions
hereof shall be binding upon and shall inure to the benefit of
the parties hereto and their respective legal representatives,
successors and assigns and may be amended only by a written
instrument signed by each of the parties hereto.
13. Continuing Pledge. The pledge made hereunder is
of a continuing nature and applies to any and all debt of the
Pledgor owing to the Pledgee, and the Pledgee may continue to
make loans or otherwise extend credit to the Pledgor at any time
and from time to time in reliance upon the pledge made hereunder
until the Pledgee actually receives written notice from the
Pledgor of the discontinuance hereof in respect of any debt
arising or incurred by the Pledgor after the receipt of such
notice by the Pledgee; provided, however, that the receipt of
such notice shall not in any way whatsoever impair, affect,
release or discharge the Pledgee's lien on or rights with respect
to any of the Pledged Shares or impair or affect in any way any
of the Pledgee's rights, powers, remedies or authority hereunder
in respect of any debt or obligation arising or incurred prior to
the Pledgee's receipt of such notice, and that this pledge shall
remain in effect until all such debt or obligation arising or
incurred prior to such receipt, and all interest thereon, has
been fully paid or satisfied.
14. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be
an original and altogether but one instrument.
<PAGE>
15. Governing Law. This Agreement shall be governed
by and construed and interpreted in accordance with the laws of
the State of Missouri.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above
written.
_________________________
"PLEDGOR"
CERNER CORPORATION.
By:__________________________
Name:
Title:
"PLEDGEE"
PROMISSORY NOTE
$_______________ _______________, _______________
(City) (State)
_______________, 19___
FOR VALUE RECEIVED, on the ______ day of _____________,
199__ I promise to pay to the order of Cerner Corporation, the
sum of _______________ Dollars ($_________________) together with
interest from the date hereof until paid at the rate of _________
percent (______%) per annum. Interest is payable annually at my
option, but if deferred, interest will compound annually at the
foregoing interest rate. This Note may be accelerated pursuant
to the terms of the Cerner Corporation Executive Stock Purchase
Plan.
________________________________
Name: __________________________
Exhibit 5
[LETTERHEAD OF STINSON, MAG & FIZZELL, P.C.]
April 23, 1999
Cerner Corporation
2800 Rockcreek Parkway
Suite 601
Kansas City, Missouri 64117
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-8 (the
"Registration Statement") of Cerner Corporation, a Delaware
corporation (the "Company"), to be filed with the Securities and
Exchange Commission on or about April 26, 1999 for the purpose
of registering under the Securities Act of 1933, as amended,
700,000 shares of Common Stock, par value $.01 per share
("Common Stock"), of the Company. These shares of Common Stock
are proposed to be issued pursuant to the Cerner Corporation
Executive Stock Purchase Plan (the "Plan").
We have examined the Restated Certificate of
Incorporation, as amended, the Bylaws of the Company, as
currently in effect, minutes of the applicable meetings of the
Board of Directors and stockholders of the Company, together with
such other corporate records, certificates of public officials
and other documents as we have deemed relevant to this opinion.
Based upon the foregoing, it is our opinion that:
1. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Delaware.
2. All necessary corporate action has been taken to
authorize the issuance of the aforesaid 700,000 shares of
Common Stock and all such shares of Common Stock as shall
be issued and paid for as described in the Plan shall be,
when so issued, legally issued, fully paid and nonassessable.
<PAGE>
We hereby consent to the reference to our firm under
the heading "Interests of Named Experts and Counsel" in the
Registration Statement. We also consent to the inclusion of this
opinion in the Registration Statement as an exhibit thereto.
Very truly yours,
STINSON, MAG & FIZZELL, P.C.
By: /s/ Craig L. Evans
Craig L. Evans
Exhibit 23(a)
ACCOUNTANTS' CONSENT
The Board of Directors
Cerner Corporation:
We consent to incorporation by reference in this
registration statement on Form S-8 of Cerner Corporation of our
report dated February 3, 1999, relating to the consolidated balance
sheets of Cerner Corporation and subsidiaries as of January 2, 1999
and January 3, 1998 and the related consolidated statements of earnings,
changes in equity, and cash flows and the related schedule for
each of the years in the three-year period ended January 2, 1999,
which report appears in the January 2, 1999 annual report on Form 10-K
of Cerner Corporation.
/s/ KPMG LLP
KPMG LLP
Kansas City, Missouri
April 23, 1999
