<PAGE> 1
As filed with the Securities and Exchange Commission on April 29, 1997
REGISTRATION NO. 333-_________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
--------------------
MEDAPHIS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 58-1651222
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2700 CUMBERLAND PARKWAY
SUITE 300
ATLANTA, GEORGIA 30339
(Address, including zip code, of registrant's principal executive offices)
MEDAPHIS CORPORATION NON-QUALIFIED STOCK OPTION PLAN
FOR NON-EXECUTIVE EMPLOYEES
(Full title of plan)
DAVID E. MCDOWELL
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
2700 CUMBERLAND PARKWAY
SUITE 300
ATLANTA, GEORGIA 30339
(770) 444-5300
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
WITH A COPY TO:
WILLIAM R. SPALDING, ESQ.
KING & SPALDING
191 PEACHTREE STREET
ATLANTA, GEORGIA 30303-1763
(404) 572-4600
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=========================================================================================================================
Proposed Maximum Proposed Maximum
Amount to Offering Price Per Aggregate Offering Amount of
Title of Securities to be Registered be Registered Share(1) Price(1) Registration Fee
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share . . . 1,025,000 $4.6875 $4,804,687.50 $1,455.97
- -------------------------------------------------------------------------------------------------------------------------
(1) Estimated solely for the purpose of computing the registration fee pursuant to Rule 457(h) on the basis of the
high and low prices of Common Stock of Medaphis Corporation on April 22, 1997.
Exhibit Index Located on Page 8
Page 1 of 29 Pages
=========================================================================================================================
</TABLE>
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information specified in Part I of Form S-8
will be sent or given to participating employees as specified by Rule 428(b)(1)
of the Securities Act of 1933, as amended (the "Securities Act"). These
documents and the documents incorporated by reference into this Registration
Statement pursuant to Item 3 of Part II of this Registration Statement, taken
together, constitute a prospectus that meets the requirements of Section 10(a)
of the Securities Act.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
The following documents previously filed by the Registrant with the
Securities and Exchange Commission are incorporated by reference in this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, filed on March 31, 1997;
(b) All reports filed by the Registrant pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since December 31, 1996; and
(c) The description of Medaphis common stock, par value $.01 per
share ("Common Stock"), contained in the Registration Statement on Form
8-A/A dated May 22, 1996.
All documents filed by the Registrant subsequent to the date of this
Registration Statement pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act and prior to the filing of a post-effective amendment which
indicates that all securities offered hereunder have been sold or which
deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference in this Registration Statement and to be a part of
this Registration Statement from the date of filing of such documents.
Item 5. Interests of Named Experts and Counsel.
The validity of the issuance of the shares of Common Stock offered hereby
will be passed upon for the Company by King & Spalding, Atlanta, Georgia.
King & Spalding also advises and represents the Company with respect to
various matters. The Company will pay King & Spalding's fees and expenses in
connection with this Registration Statement. William R. Spalding served as an
executive officer of the Company until his election as a partner of King &
Spalding on April 11, 1997.
Item 6. Indemnification of Directors and Officers.
The following summary is qualified in its entirety by reference to the
complete text of the statute, Amended and Restated Certificate of
Incorporation, as amended, Amended and Restated By-Laws and agreement referred
to below.
The Registrant's Amended and Restated By-Laws provide that each person who
was or is made a party to, is threatened to be made a party to or is otherwise
involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or was a
director, officer, employee or agent of the Registrant (or is or was serving at
the request of the Registrant as a director, officer, employee or agent of
another entity), will be indemnified and held harmless by the Registrant to the
fullest extent permitted by the Delaware General Corporation Law (the "DGCL")
as it currently exists or is later amended.
Under Section 145 of the DGCL, a corporation may indemnify a director,
officer, employee or agent of the corporation (or other entity if such person
is serving in such capacity at the corporation's request) against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him if he acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests
of the corporation and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful. In the case of an
action brought by or in the right of the corporation, the corporation may
indemnify a director, officer, employee or agent of the corporation (or other
entity if such person is serving in such capacity at the corporation's request)
against expenses (including attorneys' fees) actually and reasonably incurred
by him if he acted in good faith and
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<PAGE> 3
in a manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation, except that no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless a court determines that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnification for
such expenses as the court shall deem proper. Expenses (including attorneys'
fees) incurred by an officer or director in defending any civil, criminal,
administrative or investigative action, suit or proceeding may be paid by the
corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such director or
officer to repay such amount if it shall ultimately be determined that he is
not entitled to be indemnified by the corporation.
The Registrant's Amended and Restated Certificate of Incorporation, as
amended, provides that a director of the Registrant shall not be personally
liable to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Registrant or its stockholders, (ii) for any
acts or omissions not in good faith or which involve intentional misconduct or
a knowing violation of law, (iii) under Section 174 of the DGCL or (iv) for any
transaction in which the director derived an improper personal benefit.
In addition, the Registrant and David E. McDowell are parties to an
agreement pursuant to which the Registrant has agreed to indemnify and hold
harmless Mr. McDowell to the fullest extent permitted by the DGCL as it
presently exists or to such greater extent as such law may subsequently be
amended.
The Registrant maintains directors and officers liability insurance. Such
policies have a deductible of $500,000 and an annual per occurrence and
aggregate cap on coverage of $50 million.
Item 8. Exhibits.
<TABLE>
<CAPTION>
Exhibit Description
- ------- -----------
<S> <C>
4.1 Amended and Restated Certificate of Incorporation of
Registrant (incorporated by reference to Exhibit 4.1 of
Registrant's Registration Statement on Form S-8, File
No. 333-03213).
4.2 Certificate of Amendment of Amended and Restated Certificate
of Incorporation of Registrant (incorporated by reference
to Exhibit 4.4 of Registrant's Registration Statement on
Form S-8, File No. 333-03213).
4.3 Certificate of Amendment of Amended and Restated Certificate
of Incorporation of Registrant (incorporated by reference
to Exhibit 3.3 of Registrant's Registration Statement on
Form 8-A/A, filed on May 22, 1996).
4.4 Amended and Restated By-Laws of Registrant (incorporated by
reference to Exhibit 3.2 of Registrant's Annual Report on
Form 10-K for the year ended December 31, 1992, File
No. 000-19480).
4.5 Form of Warrant (incorporated by reference to Exhibit 4.4 of
Registrant's Current Report on Form 8-K filed on February
18, 1997).
4.6 Specimen Common Stock Certificate (incorporated by reference
to Exhibit 4.1 of Registrant's Annual Report on Form 10-K
for the year ended December 31, 1995).
5.1 Opinion of King & Spalding regarding legality of shares
being registered.
23.1 Consent of Deloitte & Touche LLP.
</TABLE>
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<PAGE> 4
<TABLE>
<S> <C>
23.2 Consent of King & Spalding (contained in the opinion filed
as Exhibit 5.1).
99.1 Medaphis Corporation Non-Qualified Stock Option Plan for
Non-Executive Employees.
99.2 First Amendment to the Medaphis Corporation Non-Qualified
Stock Option Plan for Non-Executive Employees.
</TABLE>
Item 9. Undertakings
The undersigned Registrant hereby undertakes:
(a)(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 the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective 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;
provided, however, that paragraphs (a)(1)(i) and (a)(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 with or furnished to the
Commission by the Registrant pursuant to Section 13 or 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 therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) 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 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 therein, 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 pursuant to the foregoing provisions, or otherwise, 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 labilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the
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<PAGE> 5
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.
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<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Medaphis
Corporation 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 Atlanta, State of Georgia, on this 29th day of
April, 1997.
MEDAPHIS CORPORATION
By: /s/ Jerome H. Baglien
------------------------------------
Jerome H. Baglien
Senior Vice President, Chief
Financial Officer and Assistant
Secretary
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<PAGE> 7
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ David E. McDowell Chairman, Chief Executive April 29, 1997
- ---------------------------- Officer and Director
David E. McDowell
/s/ Jerome H. Baglien Senior Vice President, April 29, 1997
- ---------------------------- Chief Financial Officer and
Jerome H. Baglien Assistant Secretary
(principal financial officer
and acting principal
accounting officer)
/s/ Robert C. Bellas, Jr. Director April 29, 1997
- ----------------------------
Robert C. Bellas, Jr.
/s/ David R. Holbrooke, M.D. Director April 29, 1997
- ----------------------------
David R. Holbrooke, M.D.
/s/ John C. Pope Director April 29, 1997
- ----------------------------
John C. Pope
/s/ Dennis A. Pryor Director April 29, 1997
- ----------------------------
Dennis A. Pryor
</TABLE>
-7-
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description Page
- ------- ----------- ----
<S> <C> <C>
4.1 Amended and Restated Certificate of Incorporation of Registrant (incorporated by
reference to Exhibit 4.1 of Registrant's Registration Statement on Form S-8, File
No. 333-03213). --
4.2 Certificate of Amendment of Amended and Restated Certificate of Incorporation
of Registrant (incorporated by reference to Exhibit 4.4 of Registrant's Registration
Statement on Form S-8, File No. 333-03213). --
4.3 Certificate of Amendment of Amended and Restated Certificate of Incorporation
of Registrant (incorporated by reference to Exhibit 3.3 of Registrant's Registration
Statement on Form 8-A/A, filed on May 22, 1996). --
4.4 Amended and Restated By-Laws of Registrant (incorporated by reference to Exhibit
3.2 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1992, --
File No. 000-19480).
4.5 Form of Warrant (incorporated by reference to Exhibit 4.4 of Registrant's Current Report
on Form 8-K filed on February 18, 1997). --
4.6 Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 of Registrant's --
Annual Report on Form 10-K for the year ended December 31, 1995).
5.1 Opinion of King & Spalding regarding legality of shares being registered. --
23.1 Consent of Deloitte & Touche LLP. --
23.2 Consent of King & Spalding (contained in the opinion filed as Exhibit 5.1). --
99.1 Medaphis Corporation Non-Qualified Stock Option Plan for Non-Executive Employees. --
99.2 First Amendment to the Medaphis Corporation Non-Qualified Stock Option Plan for --
Non-Executive Employees.
</TABLE>
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<PAGE> 1
EXHIBIT 5.1
[KING & SPALDING LETTERHEAD]
April 29, 1997
Medaphis Corporation
2700 Cumberland Parkway
Suite 300
Atlanta, Georgia 30339
Ladies and Gentlemen:
We have acted as counsel to Medaphis Corporation, a Delaware
corporation ("Medaphis"), in connection with the registration of 1,025,000
shares (the "Shares") of Medaphis common stock, par value $.01 per share,
pursuant to a Form S-8 Registration Statement (the "Registration Statement")
filed with the Securities and Exchange Commission on April 29, 1997. We
understand that the Shares will be issued pursuant to the Medaphis Corporation
Non-Qualified Stock Option Plan for Non-Executive Employees.
In so acting, we have examined and relied upon the accuracy of
original, certified, conformed or photographic copies of the Registration
Statement, and such records, other agreements, certificates and other documents
as we have deemed necessary or appropriate to enable us to render the opinion
set forth below. In all such examinations, we have assumed the genuineness of
signatures on original documents and the conformity to such original documents
of all copies submitted to us as certified, conformed or photographic copies
and, as to certificates of public officials, we have assumed the same to have
been properly given and to be accurate. We also have reviewed such releases
and no-action letters of the Securities and Exchange Commission as we have
deemed relevant to the opinion set forth below.
Based upon the foregoing and subject to the limitations and
qualifications set forth below, we are of the opinion that the Shares have been
duly authorized and, when issued in accordance with the terms of the option
agreements and option plan under which such Shares are governed, will be
validly issued, fully paid and nonassessable and free of statutory preemptive
rights.
The foregoing opinion is subject to the following limitations and
qualifications:
We are members of the Bar of the State of Georgia and, accordingly, do
not purport to be experts on or to express any opinion herein concerning any
law other than the laws of the State of Georgia, the corporate laws of the
State of Delaware, and the federal laws of the United States.
<PAGE> 2
Medaphis Corporation
April 29, 1997
Page 2
This opinion has been furnished to you at your request and no other
person or entity shall be entitled to rely upon this opinion without our prior
written consent. We consent to the inclusion of this opinion in the
Registration Statement. This opinion is given as of this date, and we assume no
obligation to advise you after this date of facts or circumstances that come to
our attention or changes in law that occur which could affect the opinions
contained in this letter.
Very truly yours,
/s/ KING & SPALDING
--------------------------
KING & SPALDING
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Medaphis Corporation on Form S-8 of our report dated March 31, 1997 (which
expresses an unqualified opinion and includes an explanatory paragraph relating
to a going concern uncertainty), appearing in the Annual Report on Form 10-K of
Medaphis Corporation for the year ended December 31, 1996.
/s/ DELOITTE & TOUCHE LLP
Atlanta, Georgia
April 25, 1997
<PAGE> 1
EXHIBIT 99.1
MEDAPHIS CORPORATION
NON-QUALIFIED STOCK OPTION PLAN
FOR NON-EXECUTIVE EMPLOYEES
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 1. PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.1. Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.2. Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.3. Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.4. Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.5. Eligible Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.6. Exchange Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.7. Fair Market Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.8. 1933 Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.9. Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.10. Option Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.11. Option Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.12. Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.13. Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 3. SHARES RESERVED UNDER THE PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 4. EFFECTIVE DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 5. ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 6. ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 7. GRANT OF OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 8. OPTION PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 9. EXERCISE PERIOD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 10. NONTRANSFERABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 11. SECURITIES REGISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 12. LIFE OF PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 13. ADJUSTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C> <C>
Section 14. CHANGE OF CONTROL AND CERTAIN OTHER EVENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
14.1. Change of Control Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
14.2. The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
14.3. Operating Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
14.4. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
14.5. Disposition of Stock Following Change of Control of Company . . . . . . . . . . . . . . . . . 9
14.6. Disposition of Stock Following Change of Control of Subsidiary . . . . . . . . . . . . . . . . 10
14.7. Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 15. AMENDMENT OR TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 16. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
16.1. No Stockholder Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
16.2. No Contract of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
16.3. Other Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
16.4. Withholding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
16.5. Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
16.6. No "Incentive Stock Option" Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
16.7. Not Rule 16b-3 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
16.8. References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
ii
<PAGE> 4
MEDAPHIS CORPORATION
NON-QUALIFIED STOCK OPTION PLAN
FOR NON-EXECUTIVE EMPLOYEES
Section 1.
PURPOSE
The purpose of this Plan is to provide options to purchase
stock to Eligible Employees in order for such Eligible Employees to acquire or
increase their proprietary interest in the Company, and for such Eligible
Employees to share in the success of the Company and to encourage them to
remain in the employ of the Company.
Section 2.
DEFINITIONS
Each capitalized term set forth in this Section 2 shall have
the meaning set forth opposite such capitalized term for purposes of this Plan
and, for purposes of such definitions, the singular shall include the plural
and the plural shall include the singular.
2.1. Board -- means the Board of Directors of the Company.
2.2. Code -- means the Internal Revenue Code of 1986, as amended.
2.3. Committee -- means the committee appointed by the Board to
administer this Plan and at all times shall consist of two or more members of
the Board.
2.4. Company -- means Medaphis Corporation, a Delaware corporation,
and any successor to such corporation.
2.5. Eligible Employee -- means any person who is an employee of the
Company or any of its subsidiaries and who is (in the judgment of the
Committee) neither subject to the
<PAGE> 5
provisions of Section 16 of the Exchange Act nor an executive level employee on
the date an Option is granted to such individual under this Plan.
2.6. Exchange Act -- means the Securities Exchange Act of 1934, as
amended.
2.7. Fair Market Value -- means for any date (i) the closing price
for such date for a share of Stock as reported by The Wall Street Journal under
the New York Stock Exchange Composite Transactions quotation system (or under
any successor quotation system) or, (ii) if the Stock is not traded on the New
York Stock Exchange, as reported for such date by The Wall Street Journal under
the NASDAQ National Market System quotation system or under the quotation
system under which such closing price is reported or, (iii) if The Wall Street
Journal does not report such closing price, such closing price as reported for
such date by a newspaper or trade journal selected by the Committee or, (iv) if
no such closing price is available for such date, such closing price as so
reported or so quoted in accordance with Section 2.7(i), (ii) or (iii) for the
immediately preceding business day, or, (v) if no newspaper or trade journal
reports such closing price or if no such price quotation is available, the
price that the Committee acting in good faith determines through any reasonable
valuation method that a share of Stock might change hands between a willing
buyer and a willing seller, neither being under any compulsion to buy or to
sell and both having reasonable knowledge of the relevant facts.
2.8. 1933 Act -- means the Securities Act of 1933, as amended.
2.9. Option -- means an option granted under this Plan to purchase
Stock.
2.10. Option Agreement -- means the written agreement that sets
forth theterms of an Option granted to an Eligible Employee under this Plan.
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2.11. Option Price -- means the price that shall be paid to
purchase one share of Stock upon the exercise of an Option granted under this
Plan.
2.12. Plan -- means this Medaphis Corporation Non-qualified Stock
Option Plan for Non-Executive Employees, as amended from time to time.
2.13. Stock -- means the common stock of the Company, par value
$.01 per share.
Section 3.
SHARES RESERVED UNDER THE PLAN
There shall be 925,000 shares of Stock reserved for issuance under
this Plan, and such shares of Stock shall be reserved to the extent that the
Company deems appropriate from authorized but unissued shares of Stock and from
shares of Stock which have been repurchased by the Company. Furthermore, any
shares of Stock subject to an Option that remain unissued after the
cancellation or expiration of such Option thereafter shall again become
available for use under this Plan.
Section 4.
EFFECTIVE DATE
The effective date of this Plan shall be November 19, 1996.
Section 5.
ADMINISTRATION
This Plan shall be administered by the Committee. The Board may from
time to time remove members from, or add members to, the Committee. Vacancies
on the Committee shall be filled by the Board and the Board shall designate the
Chairman of the Committee. The Committee shall hold meetings at such times and
places as it may determine. The Committee
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acting in its absolute discretion shall exercise such powers and take such
action as expressly called for under this Plan and, further, the Committee
shall have the power to interpret this Plan and to take such other action
(except to the extent the right to take such action is expressly and
exclusively reserved for the Board) in the administration and operation of this
Plan as the Committee deems equitable under the circumstances, which action
shall be binding on the Company, on each affected Eligible Employee and on each
other person directly or indirectly affected by such action. No member of the
Board or the Committee shall be liable for any action or determination made in
good faith with respect to this Plan or any Option granted under this Plan.
Section 6.
ELIGIBILITY
Only Eligible Employees shall be eligible for the grant of Options
under this Plan.
Section 7.
GRANT OF OPTIONS
The Committee, acting in its absolute discretion, shall have the right
to grant Options to Eligible Employees under this Plan. Each grant of an
Option shall be evidenced by an Option Agreement, and each Option Agreement
shall incorporate such terms and conditions as the Committee, acting in its
absolute discretion, deems consistent with the terms of this Plan; provided
that (unless the Committee decides otherwise with respect to any Option grant
or Option grants) each Option Agreement shall provide that if the Eligible
Employee ceases to be an employee of the Company or of any parent or subsidiary
of the Company (other than as a result of a transaction contemplated by Section
14) before the Option is fully vested, any portion of the
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Option which is not fully vested on the date of such termination of employment
shall be automatically forfeited as of such employment termination date, and
the vested portion of the Option which is unexercised shall expire, terminate
and become unexercisable no later than the earlier to occur of: (i) the
expiration of three (3) months from the date on which the Eligible Employee
ceases to be an employee of the Company or of any parent or subsidiary of the
Company for any reason other than death or disability (within the meaning of
Code Section 22(e)(3)), or (ii) the expiration of six (6) months from the date
the Eligible Employee ceases to be employed by the Company or any parent or
subsidiary of the Company for reasons of death or disability (within the
meaning of Code Section 22(e)(3)).
Section 8.
OPTION PRICE
The Option Price for each share of Stock subject to an Option may (in
the absolute discretion of the Committee) be more or less than or equal to the
Fair Market Value of a share of Stock on the date such Option is granted;
provided, however, that in no event shall the Option Price be less than
adequate consideration as determined by the Committee.
Section 9.
EXERCISE PERIOD
Each Option granted under this Plan shall be exercisable in
whole or in part at such time or times as set forth in the related Option
Agreement, but no Option Agreement shall make an Option exercisable after the
earlier of
(a) the date such option is exercised in full or forfeited, or
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(b) the date which is the eleventh anniversary of the date
such Option is granted.
Section 10.
NONTRANSFERABILITY
No Option granted under this Plan shall be transferable by an
Eligible Employee other than by will or by the laws of descent and distribution
at his or her death, and an Option shall be exercisable during an Eligible
Employee's lifetime only by the Eligible Employee or, if the Eligible Employee
is determine under applicable law to be incompetent to act on his or her own
behalf, by the person authorized under such applicable law to act on the
Eligible Employee's behalf. The Company shall treat any person to whom an
Option is transferred by will or by the laws of descent and distribution the
same as an Eligible Employee for purposes of exercising such Option.
Section 11.
SECURITIES REGISTRATION
Each Option Agreement shall provide that, upon the receipt of shares
of Stock as a result of the exercise of an Option, the Eligible Employee shall,
if so requested by the Company, hold such shares of Stock for investment and
not with a view to resale or distribution to the public and, if so requested by
the Company, shall deliver to the Company a written statement satisfactory to
the Company to that effect. Each Option Agreement also shall provide that, if
so requested by the Company, the Eligible Employee shall make a written
representation to the Company that he or she will not sell or offer to sell any
of such Stock unless a registration statement shall be in effect with respect
to such stock under the 1933 Act and any applicable state
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<PAGE> 10
securities law or unless he or she shall have furnished to the Company an
opinion, in form and substance satisfactory to the Company, of legal counsel
acceptable to the Company, that such registration is not required.
Certificates representing the Stock transferred upon the exercise of an Option
granted under this Plan may at the discretion of the Company bear a legend to
the effect that such Stock has not been registered under the 1933 Act or any
applicable state securities law and that such Stock may not be sold or offered
for sale in the absence of an effective registration statement as to such Stock
under the 1933 Act and any applicable state securities law or an opinion, in
form and substance satisfactory to the Company, of legal counsel acceptable to
the Company, that such registration is not required.
Section 12.
LIFE OF PLAN
No Option shall be granted under this Plan on or after the earlier of
(a) the tenth anniversary of the effective date of this
Plan (as determined under Section 4), in which event
this Plan thereafter shall continue in effect until all
outstanding Options have been exercised in full or no
longer are exercisable, or
(b) the date on which all of the Stock reserved under
Section 3 has (as a result of the exercise of Options
granted under this Plan) been issued or no longer is
available for use under this Plan, in which event this
Plan also shall terminate on such date.
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Section 13.
ADJUSTMENT
The number of shares of Stock reserved under Section 3, the number of
shares of Stock subject to Options granted under this Plan and the Option Price
of such Options shall be adjusted by the Committee in a equitable manner to
reflect any change in the capitalization of the Company, including, but not
limited to, such changes as stock dividends or stock splits, a subdivision or
combination of the Stock, a reclassification of the Stock, a merger or
consolidation of the Company or any like changes in the Stock or in the value
of a share of Stock. If any adjustment under this Section 13 would create a
fractional share of Stock or a right to acquire a fractional share of Stock,
such fractional share shall be disregarded and the number of shares of Stock
reserved under this Plan and the number subject to any Options granted under
this Plan shall be the next lower number of shares of Stock, rounding all
fractions downward. Any adjustment made under this Section 13 by the
Committee shall be conclusive and binding on affected persons.
Section 14.
CHANGE OF CONTROL AND CERTAIN OTHER EVENTS
14.1. Change of Control Events. The following events shall
constitute "Change of Control" events for purposes of this Plan: (1) The
adoption of a plan of merger or consolidation of the Company with any other
corporation as a result of which the holders of the outstanding voting stock of
the Company as a group would receive less than fifty percent (50%) of the
voting stock of the surviving or resulting corporation; (2) The adoption of
a plan of liquidation or the approval of the dissolution of the Company; (3)
The sale or transfer of substantially all of the assets of the Company; (4) The
sale or transfer of substantially all of the assets or stock of an
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operating subsidiary of the Company, other than as security for obligations of
the Company; or (5) The sale or transfer of substantially all of the assets of
an operating division of the Company or its subsidiaries, other than as
security for obligations of the Company.
14.2. The Company. In the event of a Change of Control event
described in Section 14.1(1), (2) or (3), the unexercised portion of all
outstanding Options under this Plan will become fully vested and immediately
exercisable and will remain exercisable until the occurrence of such Change of
Control event, after which time all outstanding Options will immediately
terminate as to any portion thereof not exercised.
14.3. Operating Subsidiary. In the event of a Change of Control
event described in Section 14.1(4) or (5) which results in the Eligible
Employees employed by the affected operating subsidiary or division being
terminated from their current employment with the Company, then the unexercised
portion of all outstanding Options under this Plan held by those affected
Eligible Employees will become fully vested and immediately exercisable. Such
Options will remain exercisable until the earlier of (1) the expiration of the
respective terms of such Options, or (2) six (6) months following such
termination of employment.
14.4. Notice. Subject to compliance with applicable federal and
state securities laws, the Committee will undertake to provide applicable
Eligible Employees with reasonable notice of any Change of Control event
described in Section 14.1 prior to the occurrence of such Change of Control
event.
14.5. Disposition of Stock Following Change of Control of Company.
In the event of a Change of Control event described in Section 14.1(1), (2) or
(3), each Eligible Employee electing to exercise any outstanding Option will
have the right in connection with the closing of such
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<PAGE> 13
Change of Control event either to (1) sell to the Company or the surviving or
resulting corporation, the shares of Stock which the Eligible Employee received
upon exercise of such Option at a cash price per share equivalent of the Fair
Market Value of the Stock as of the date of such Change of Control event, or
(2) receive the number and class of shares of stock or other securities or any
other property to which the terms of the agreement of merger, consolidation, or
other reorganization would entitle the Eligible Employee to receive as the
holder of record of the number of shares of Stock which the Eligible Employee
received upon exercise of such Option; provided, however, that in the event a
Change of Control event contemplated by this Section 14.5 involves a merger to
be accounted for under the "pooling of interest" accounting method, then the
Committee shall have the authority hereunder to modify the rights of an
Eligible Employee under this Section 14.5 to the extent necessary in order to
preserve the "pooling of interest" accounting treatment for such merger.
14.6. Disposition of Stock Following Change of Control of
Subsidiary. In the event of a Change of Control event described in Section
14.1(4) or (5), each affected Eligible Employee electing to exercise any
outstanding Option will have the right to sell to the Company the shares of
Stock which the Eligible Employee received upon exercise of such Option at a
price per share equivalent to the Fair Market Value of the Stock subject to
such Option, such payment to be made in the form of cash or notes or any
combination of cash and notes, as determined by the Committee. The Committee
will make reasonable efforts to assure that an Eligible Employee electing to
sell shares of Stock pursuant to this Section 14.6 receives cash consideration
in the amount at least sufficient to offset the aggregate Option Price paid to
the Company by the Eligible Employee in connection with the exercising of such
Option.
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14.7. Fractional Shares. No Change of Control event contemplated by
this Section 14 shall create a right to acquire a fractional share of Stock,
and any such fractional share shall be forfeited by the Eligible Employee.
Section 15.
AMENDMENT OR TERMINATION
This Plan maybe amended by the Committee from time to time to the
extent that the Committee deems necessary or appropriate. The Committee also
may suspend the granting of Options under this Plan at any time and may
terminate this Plan at any time; provided; however, the Committee shall not
have the right unilaterally to modify, amend or cancel any Option granted
before such modification, amendment or cancellation unless the Eligible
Employee consents in writing to such modification, amendment or cancellation.
Section 16.
MISCELLANEOUS
16.1. No Stockholder Rights. No Eligible Employee shall have any
rights as a stockholder of the Company as a result of the grant of an Option
to him or to her under this Plan or his or her exercise of such Option pending
the actual delivery of Stock subject to such Option to such Eligible Employee.
16.2. No Contract of Employment. The grant of an Option to an
Eligible Employee under this Plan shall not constitute a contract of employment
and shall not confer on an Eligible Employee any rights upon his or her
termination of employment in addition to those rights, if any, expressly set
forth in the Option Agreement which evidences his or her Option.
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16.3. Other Conditions. Each Option Agreement may require that an
Eligible Employee (as a condition to the exercise of an Option) enter into any
agreement or make such representations requested by the Company, including any
agreement which restricts the transfer of Stock acquired pursuant to the
exercise of such Option and provides for the repurchase of such Stock by the
Company under certain circumstances.
16.4. Withholding. The exercise of any Option granted under this
Plan shall constitute an Eligible Employee's full and complete consent to
whatever action the Committee deems necessary to satisfy the federal and state
tax withholding requirements, if any, which the Committee acting in its
discretion deems applicable to such exercise.
16.5. Construction. This Plan shall be construed under the laws of
the State of Delaware.
16.6. No "Incentive Stock Option" Treatment. No Option granted under
this Plan shall be treated as an "incentive stock option" within the meaning of
Section 422 of the Code.
16.7. Not Rule 16b-3 Plan. This Plan is not intended to satisfy and
will not satisfy the conditions set forth in Rule 16b-3 under Section 16 of the
Exchange Act.
16.8. References. Any reference in this Plan to a section (Section)
shall be to a section (Section) of this Plan unless otherwise specified in such
reference.
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EXHIBIT 99.2
FIRST AMENDMENT
TO
MEDAPHIS CORPORATION
NON-QUALIFIED STOCK OPTION PLAN
FOR NON-EXECUTIVE EMPLOYEES
THIS FIRST AMENDMENT (the "First Amendment") is made this 21st day of
January, 1997, by MEDAPHIS CORPORATION, a Delaware corporation (the "Company").
W I T N E S S E T H
WHEREAS, the Company has previously adopted the Medaphis Corporation
Non-Qualified Stock Option Plan for Non-Executive Employees (the "Plan"); and
WHEREAS, the Board of Directors of the Company has approved an increase in
the number of shares reserved for issuance pursuant to the Plan to 1,025,00 from
925,000 shares (the "First Amendment").
NOW, THEREFORE, Section 3 of the Plan is hereby amended by deleting Section
3 of the Plan in its entirety and replacing it with the following:
"Section 3.
SHARES RESERVED UNDER THE PLAN
There shall be 1,025,000 shares of Stock reserved for issuance
under this Plan, and such shares of Stock shall be reserved to
the extent that the Company deems appropriate from authorized but
unissued shares of Stock and from shares of Stock which have been
repurchased by the Company. Furthermore, any shares of Stock
subject to an Option that remain unissued after the cancellation
or expiration of such Option thereafter shall again become
available for use under this Plan."
FURTHER, except as specifically amended by this First Amendment, the Plan
shall remain in full force and effect as prior to this First Amendment.
<PAGE> 2
IN WITNESS WHEREOF, the Company had caused this First Amendment to be
executed on the day and year first above written.
MEDAPHIS CORPORATION
By: /s/ William R. Spalding
-------------------------------
Name: William Spalding
-----------------------------
Title: EVP
----------------------------
ATTEST:
By: /s/ Peggy Sherman
----------------------------
Name: Peggy Sherman
--------------------------
Title: VP, AGC
-------------------------
