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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 24, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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PER-SE TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 58-1651222
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
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2840 MT. WILKINSON PARKWAY, SUITE 300, ATLANTA, GEORGIA 30339-3632
(770) 444-5300
(Address, including zip code, and telephone number,
including area code, of registrant's executive offices)
RANDOLPH L. M. HUTTO, ESQ.
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
PER-SE TECHNOLOGIES, INC.
2840 MT. WILKINSON PARKWAY, SUITE 300
ATLANTA, GEORGIA 30339-3632
(770) 444-5300
(Name, address, including zip code, and telephone number
including area code, of agent for service)
THE COMMISSION IS REQUESTED TO SEND COPIES OF ALL COMMUNICATIONS TO:
J. VAUGHAN CURTIS, ESQ.
ALSTON & BIRD LLP
ONE ATLANTIC CENTER
1201 WEST PEACHTREE STREET
ATLANTA, GEORGIA 30309-3424
(404) 881-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TITLE OF SHARES TO BE OFFERING PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) FEE
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Common stock, par value $.01 per share (with
attached Rights to purchase Series A Junior
Preferred Stock, no par value)(2) 6,200,000 shares $3.50 $21,700,000 $6,032.60
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(1) Estimated solely for purposes of determining the registration fee pursuant
to Rule 457(c).
(2) Prior to the occurrence of certain events, the Rights will not be evidenced
or traded separately from the Per-Se Technologies common stock. Value, if
any, of the Rights is reflected in the market price of the Per-Se
Technologies common stock. Accordingly, no separate fee is paid.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING STOCKHOLDER MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND THE SELLING STOCKHOLDER
IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE SUCH OFFER
OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED SEPTEMBER 24, 1999
PROSPECTUS
6,200,000 Shares
PER-SE TECHNOLOGIES, INC.
Common Stock
Our stockholder, Foundation Health Systems, Inc. (formerly known as Health
Systems International, Inc.), is offering and selling 6,200,000 shares of our
common stock under this prospectus. The selling stockholder acquired the
6,200,000 shares from us in a settlement of various claims against us arising
from a stock for stock merger transaction on May 31, 1996 in which all
shareholders of Health Data Sciences Corporation (including the selling
stockholder) received shares of our common stock in exchange for their shares of
Health Data Sciences Corporation stock.
The selling stockholder will sell its shares of common stock through public
or private transactions at prevailing market prices or at privately negotiated
prices. The selling stockholder has an agreement with Donaldson, Lufkin &
Jenrette Securities Corporation under which DLJ will assist the selling
stockholder in selling its shares of common stock. See "Plan of Distribution."
We will not receive any of the proceeds from the sale of shares of common stock
by the selling stockholder, except as otherwise described in "Plan of
Distribution."
Our common stock is listed on the Nasdaq National Market under the symbol
"PSTI." On September 17, 1999, the last sale price of our common stock as
reported by Nasdaq was $3 1/2 per share.
Our principal executive offices are located at 2840 Mt. Wilkinson Parkway,
Suite 300, Atlanta, Georgia 30339-3632, and our telephone number is (770)
444-5300.
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THIS INVESTMENT INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 4.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE COMMISSION HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is , 1999
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TABLE OF CONTENTS
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PAGE
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Additional Information...................................... 2
Incorporation of Certain Documents by Reference............. 3
Cautionary Notice Regarding Forward-Looking Statements...... 3
Risk Factors................................................ 4
The Company................................................. 9
Use of Proceeds............................................. 9
Selling Stockholder......................................... 10
Plan of Distribution........................................ 10
Legal Matters............................................... 12
Experts..................................................... 12
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ADDITIONAL INFORMATION
We file annual, quarterly, and current reports, proxy statements, and other
documents with the Commission. You may read and copy any document we file at the
following locations of the Commission:
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Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center 500 West Madison Street
Room 1024 Suite 1300 Suite 1400
Washington, D.C. 20549 New York, New York 10048 Chicago, Illinois 60661
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You may call 1-800-SEC-0330 for more information on the Commission's public
reference facilities. You may also obtain copies of this information by mail
from the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549, at prescribed rates. The Commission also
maintains an Internet site at http://www.sec.gov that contains reports, proxy
statements and other information about issuers, like Per-Se Technologies, who
file electronically with the Commission. In addition, you can inspect reports,
proxy statements and other information about Per-Se Technologies at the offices
of The Nasdaq Stock Market, Inc., Reports Section, 1735 K Street, N.W.,
Washington, D.C. 20006. Also, you can find more information about Per-Se
Technologies on our Internet website at http://www.per-se.com. However,
information contained in or linked to our website does not constitute part of
this prospectus and is not, and shall not be deemed to be, incorporated into
this prospectus by reference.
This prospectus is part of a registration statement that we filed with the
Commission. The registration statement contains more information than this
prospectus regarding Per-Se Technologies and our common stock, including certain
exhibits. You can get a copy of the registration statement from the Commission
at the addresses listed above or from its Internet site.
We furnish stockholders with annual reports containing audited financial
statements and with proxy materials for our annual meeting of stockholders
complying with the Exchange Act of 1934, as amended.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Commission allows us to "incorporate" into this prospectus information
we file with the Commission in other documents. This means that we can disclose
important information to you by referring to other documents that contain that
information. The information incorporated by reference is considered to be part
of this prospectus, and information we file later with the Commission will
automatically update and, to some extent, supersede this information. We
incorporate by reference the documents listed below, except to the extent
information in those documents is different from the information contained in
this prospectus, and all future documents filed with the Commission under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until
the termination of the offering of these shares:
(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1998;
(b) Current Report on Form 8-K filed February 12, 1999 (event date
February 12, 1999);
(c) Current Report on Form 8-K filed May 5, 1999 (event date April 20,
1999);
(d) Quarterly Report on Form 10-Q for the quarter ended March 31,
1999;
(e) Quarterly Report on Form 10-Q for the quarter ended June 30, 1999;
(f) Current Report on Form 8-K filed August 16, 1999 (event date
August 16, 1999);
(g) Current Report on Form 8-K filed September 21, 1999 (event date
September 20, 1999);
(h) The description of common stock set forth in the registration
statement on Form 8-A/A filed May 22, 1996, and any amendment or report
filed for the purpose of updating such description; and
(i) The description of Rights set forth in the registration statement
on Form 8-A filed February 12, 1999, and any amendment or report filed for
the purpose of updating such description.
We will provide without charge to each person to whom this prospectus is
delivered, upon written or oral request of such person, a copy of any and all of
the documents that have been incorporated by reference in this prospectus (not
including exhibits to such documents unless such exhibits are specifically
incorporated by reference in this prospectus). Requests should be directed to
Per-Se Technologies, Inc., 2840 Mt. Wilkinson Parkway, Suite 300, Atlanta,
Georgia 30339-3632, Attention: Corporate Secretary; telephone number (770)
444-5300.
You should rely only on the information contained or incorporated by
reference in this document. We have not authorized anyone to provide you with
information that is different from that which is contained or incorporated by
reference in this prospectus. The common stock is not being offered in any state
where the offer is not permitted. You should not assume that the information in
this prospectus is accurate as of any date other than the date on the front of
this prospectus.
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS INCLUDES STATEMENTS THAT MAY CONSTITUTE "FORWARD-LOOKING
STATEMENTS" WITHIN THE MEANING OF THE SECURITIES ACT OF 1933 AND THE SECURITIES
EXCHANGE ACT OF 1934. THOSE STATEMENTS INCLUDE STATEMENTS REGARDING THE INTENT,
BELIEF OR CURRENT EXPECTATIONS OF PER-SE TECHNOLOGIES AND MEMBERS OF PER-SE
TECHNOLOGIES' MANAGEMENT TEAM AS WELL AS THE ASSUMPTIONS ON WHICH SUCH
STATEMENTS ARE BASED. PROSPECTIVE INVESTORS ARE CAUTIONED THAT ANY SUCH
FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE
RISKS AND UNCERTAINTIES, AND THAT ACTUAL RESULTS MAY DIFFER MATERIALLY FROM
THOSE CONTEMPLATED BY SUCH FORWARD-LOOKING STATEMENTS. IMPORTANT FACTORS
CURRENTLY KNOWN TO PER-SE TECHNOLOGIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE IN FORWARD-LOOKING STATEMENTS ARE SET FORTH IN THE "RISK
FACTORS" SECTION OF THIS PROSPECTUS AND THE SAFE HARBOR COMPLIANCE STATEMENT FOR
FORWARD-LOOKING STATEMENTS INCLUDED AS AN EXHIBIT TO THE REPORTS FILED BY PER-SE
TECHNOLOGIES WITH THE COMMISSION UNDER THE SECURITIES EXCHANGE ACT OF 1934 AND
INCORPORATED HEREIN BY REFERENCE. PER-SE TECHNOLOGIES UNDERTAKES NO OBLIGATION
TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS TO REFLECT CHANGED ASSUMPTIONS,
THE OCCURRENCE OF UNANTICIPATED EVENTS OR CHANGES TO FUTURE OPERATING RESULTS
OVER TIME.
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RISK FACTORS
Before you invest in our common stock, you should be aware that there are
various risks, including those described below. You should carefully consider
these risk factors, together with all of the other information included in this
prospectus, before you decide whether to purchase shares of our common stock.
OUR SUBSTANTIAL INDEBTEDNESS COULD ADVERSELY AFFECT OUR FINANCIAL PERFORMANCE.
We have a significant amount of indebtedness and, as a result, significant
obligations to make payments on our debt. If we are unable to make the required
debt payments, we could be required to reduce or delay capital expenditures,
sell certain of our assets, restructure or refinance our indebtedness, or seek
additional equity capital. Our ability to make payments on our debt obligations
will depend on our future operating performance, which will be affected by
certain conditions that are beyond our control.
Our substantial indebtedness could have important consequences to our
financial performance. For example:
- our ability to obtain additional financing in the future may be impaired;
- if a substantial portion of our cash flow from operations is dedicated to
the payment of debt, we may have reduced funds available for operations;
- the terms of our existing debt places restrictions on us, including our
ability to incur additional debt or pay dividends; and
- we may be more leveraged than our competitors, which may limit our
flexibility to respond to changes in the marketplace and may place us at
a competitive disadvantage.
WE ARE SUBJECT TO ONGOING LITIGATION AND A GOVERNMENT INVESTIGATION THAT MAY
ADVERSELY AFFECT OUR BUSINESS.
We are involved in several lawsuits which may expose us to material loss
contingencies. These lawsuits include, but are not limited to, claims brought by
former stockholders of companies that we acquired and claims by customers and
former customers. We have also received written demands from customers and
former customers that have not yet resulted in legal action and may receive
demands with respect to the operation of our business and actions we have taken,
including modifications made to a computerized coding tool to assist in
healthcare reimbursement used by one of our subsidiaries and the transition from
the computerized coding tool to manual coding. We are also subject to a formal,
non-public investigation by the Securities and Exchange Commission into, among
other things, insider trading and other issues relating to restatements of our
financial statements.
We may not be able successfully to defend any of these lawsuits. In
addition, other lawsuits may be filed and other governmental investigations may
be commenced against us. Existing or new lawsuits or new government
investigations could have a material adverse effect on us. The ongoing
governmental investigation against us may result in significant fines, damages
or other penalties and the Commission could require further restatements of our
financial statements. The investigation could have a material adverse effect on
us. Also, in the event of an adverse outcome with respect to pending lawsuits,
there is the risk that our insurance coverage may not fully cover any damages
assessed against us. The litigation with which we are involved (as well as
future litigation) could have a disruptive effect upon the operations of the
business and consume the time and attention of our senior management.
WE HAVE INCURRED SIGNIFICANT LOSSES IN RECENT YEARS.
We had losses in each of 1995, 1996, 1997, 1998 and 1999. Most of these
losses result from restructuring and other charges, litigation settlements,
intangible asset impairment, and acquisition costs. We cannot assure you when or
if we will become profitable in the future.
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WE HAVE SUFFERED SIGNIFICANT SETBACKS IN RECENT YEARS AND MAY NOT BE ABLE TO
TURNAROUND SUCCESSFULLY.
We have suffered several setbacks in recent years, including:
- government investigations;
- the failure successfully to integrate acquired companies;
- restatements of our 1994, 1995, 1996 and interim 1997 financial
statements;
- the discontinuance of the operations of one of the businesses we
acquired;
- the abandonment of an extensive reengineering program that failed;
- a steep drop in the price of our common stock; and
- the filing of various lawsuits and claims against us.
As a result of these setbacks, we have been operating in what is commonly
described as a "turnaround" situation. In addition to risks associated with
"turnaround" situations, we face certain challenges more specific to our
operations, including:
- successfully integrating acquired companies;
- shifting our strategic focus from acquiring compatible businesses to
running our existing businesses efficiently and profitably;
- managing our customers' perceptions of our continued viability and
focusing on customer service;
- combating employee turnover;
- reducing costs and increasing efficiencies; and
- reevaluating the efficiency of our operations following our abandonment
of the reengineering initiative in 1996.
WE MAY NOT BE ABLE TO KEEP UP WITH CHANGES IN OUR INDUSTRY.
The markets for our software products and services are characterized by
rapidly changing technology, evolving industry standards and frequent new
product introductions. We may not be able to keep pace with changes in our
industry. Our success depends in part upon our ability to:
- enhance our existing products and services;
- introduce new products and services quickly and cost effectively;
- achieve market acceptance for new products and services; and
- respond to emerging industry standards and other technological changes.
Also, our competitors may develop competitive products that could adversely
affect our operating results. In addition, it is possible that:
- we will be unsuccessful in refining, enhancing and developing our
software and billing systems going forward;
- the costs associated with refining, enhancing and developing our software
and systems may increase significantly in the future; or
- our existing software and technology will become obsolete as a result of
ongoing technological developments in the marketplace.
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WE COULD LOSE CERTAIN CUSTOMERS IF WE ARE NOT SUCCESSFUL ON SEVERAL MAJOR CLIENT
PROJECTS.
Our client/server information technology business involves projects
designed to reengineer customer operations through the strategic use of imaging,
client/server and other advanced technologies. Failure to meet our customers'
expectations with respect to a major project could have the following
consequences:
- damage our reputation and standing in this marketplace;
- impairment of our ability to attract new client/server information
technology business;
- the payment of damages to a customer; and
- the inability to collect for services already performed on the project.
WE MAY INCUR ADDITIONAL COSTS BECAUSE OF POTENTIAL "YEAR 2000" PROBLEMS.
Many existing computer programs use only two digits to identify a year in
the date field. These programs were designed and developed without considering
the impact of the upcoming change in the century. If not corrected, many
computer applications could fail or create erroneous results as we approach or
when we reach the Year 2000.
We have undertaken an assessment of our Year 2000 issues. We have
identified some older computer systems that we will replace with more efficient
processing systems, rather than attempting to make all these older systems Year
2000 compliant. Until we have replaced all these older systems, we cannot be
sure that our efforts to address Year 2000 issues are appropriate, adequate or
complete. In addition, we cannot be sure that we have identified all Year 2000
problems in the computer systems of our customers, vendors or resellers, or that
we will be able to successfully remedy any future problems that are discovered.
As a result of Year 2000 issues and the replacement of older computer
systems, we may suffer the following consequences:
- we may incur a significant amount of additional expenses to remedy Year
2000 issues and we may experience a significant loss of revenues;
- our existing customers may be adversely impacted by Year 2000 problems,
which could cause fluctuations in our revenue; and
- our failure to identify and remedy all Year 2000 problems could put us at
a competitive disadvantage relative to companies that have corrected such
problems.
WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY WITH OTHER MANAGEMENT SERVICES
COMPANIES.
The medical management services business is highly competitive. We compete
with national and regional physician and hospital reimbursement organizations
and collection businesses, national information and data processing
organizations, and physician groups and hospitals that provide their own
business management services. We are uncertain whether we can continue to
compete successfully with all of these competitors.
Potential industry and market changes that could adversely affect our
ability to compete for billing and collection business include:
- an increase in the number of managed care providers compared to
fee-for-service providers; and
- new alliances between healthcare providers and third-party payors in
which healthcare providers are employed by such third-party payors.
WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY WITH OTHER INFORMATION TECHNOLOGY
COMPANIES.
The business of providing application software, information technology and
consulting services is also highly competitive. We compete with national and
regional companies in this regard. Certain of our
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competitors have longer operating histories and greater financial, technical and
marketing resources than we do. We are uncertain whether we can continue to
compete successfully with these competitors.
OUR REVENUE AND OPERATIONS MAY BE ADVERSELY AFFECTED BY PRICING PRESSURES THAT
ADVERSELY AFFECT OUR CUSTOMERS.
We believe that the revenue growth rate experienced by our healthcare
clients continues to be adversely affected by managed care pricing and declining
government reimbursement levels. At the same time, the process of submitting
healthcare claims for reimbursement to third-party payors in accordance with
applicable industry and regulatory standards grows in complexity and cost. We
believe that these trends have adversely affected and could continue to
adversely affect our customers' revenues and profitability and, therefore,
adversely affect us too.
CHANGES IN THE HEALTHCARE MARKETPLACE MAY DECREASE DEMAND FOR OUR BILLING
SERVICES.
In general, consolidation initiatives in the healthcare marketplace may
result in fewer potential customers for our services. Some of these types of
initiatives include:
- employer initiatives such as creating purchasing cooperatives, like HMOs;
- provider initiatives, such as risk-sharing among healthcare providers and
managed care companies through capitated contracts; and
- integration among hospitals and physicians into comprehensive delivery
systems.
We believe that the continued consolidation of management and billing
services through integrated delivery systems could result in a decrease in
demand for our billing and collection services for particular physician
practices.
FUTURE INVESTIGATIONS OF HEALTHCARE BILLING AND COLLECTION PRACTICES MAY
ADVERSELY AFFECT OUR BUSINESS.
Our medical billing and collection activities are governed by numerous
federal and state civil and criminal laws. Federal and state regulators
increasingly use these laws to investigate healthcare providers and companies
like us, that provide billing and collection services. In connection with these
laws:
- we may be subjected to federal or state government investigation and
possible civil or criminal fines;
- we may ultimately be required to defend a false claims action;
- we may be sued by private payors; or
- we may be excluded from Medicare, Medicaid and/or other government funded
healthcare programs.
We have been the subject of several federal investigations, and we may
become the subject of false claims litigation or additional investigations
relating to our billing and collection activities. Any such proceeding or
investigation could have a material adverse effect on our business.
The ownership and operation of hospitals is also subject to comprehensive
regulation by federal and state governments that may adversely affect hospital
reimbursement. This regulation could have an adverse effect on the operations of
hospitals in general, and consequently reduce the amount of our revenues related
to hospital clients. Current or future government regulations or healthcare
reform measures may have a material adverse effect upon our business.
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OUR STOCK PRICE HAS BEEN VOLATILE AND COULD CONTINUE TO FLUCTUATE SUBSTANTIALLY.
Our common stock is listed on the Nasdaq National Market. The market price
of our common stock has been volatile and could fluctuate substantially, based
on a variety of factors, including the following:
- announcements relating to governmental investigations;
- our liquidity and financial resources;
- our divestiture of businesses;
- the status of lawsuits or other demands;
- healthcare reform measures;
- quarter-to-quarter and year-to-year variations in financial results; and
- failure to continue to meet Nasdaq National Market listing requirements.
Furthermore, stock prices for many companies fluctuate widely for reasons
that may be unrelated to their operating results. These fluctuations and general
economic, political and market conditions may adversely affect the market price
of our common stock.
LISTING ON NASDAQ NATIONAL MARKET.
Our common stock is currently traded on the Nasdaq National Market. Nasdaq
has notified us that we are out of compliance with the Nasdaq National Market's
continued listing requirements of a minimum bid price of $5.00 or net tangible
assets of $4 million. Nasdaq has notified us that our situation is being
reviewed, and that a decision by Nasdaq is likely to be issued in December 1999.
We expect that we have until that time to:
- meet the requirements;
- file an appeal with Nasdaq; or
- make an application to have our common stock traded on the Nasdaq
SmallCap Market or other exchange.
We have formulated plans, including a possible reverse stock split, that we
could implement to avoid a change in our Nasdaq National Market listing.
In addition, since we currently meet all listing requirements for the
Nasdaq SmallCap Market, we are prepared to make an application for listing of
our common stock on that market, if necessary.
There can be no assurance that we will be able to implement these plans
successfully. If our stock price does not otherwise regain compliance with the
Nasdaq National Market requirements, and we fail to implement available options,
then our common stock could potentially be de-listed from the Nasdaq National
Market. In that event, our common stock would then be traded in the
over-the-counter market. Such a result could adversely impact the liquidity of
our common stock.
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THE COMPANY
Per-Se Technologies, which was incorporated in 1985 in Delaware and was
formerly known as Medaphis Corporation, is a global leader in delivering
integrated financial and clinical software solutions, comprehensive business
management services, and Internet-enabled connectivity to healthcare providers.
Per-Se's integrated financial and clinical software offerings include
patient scheduling, staff management, clinical information systems and patient
financial management software.
Our business management services to physicians and healthcare
organizations, include clinical data collection, data input, medical coding,
billing, contract management, cash collections and accounts receivable
management. These services are designed to assist healthcare providers with the
business management functions associated with the delivery of healthcare
services, allowing physicians and hospital staff to focus on providing quality
patient care. These services also assist physicians and healthcare organizations
in improving cash flows and reducing administrative costs and burdens.
We also offer Internet-enabled connectivity to both integrated healthcare
delivery networks and physician practices, including electronic claims
processing, referral submissions, eligibility verification and other electronic
transaction processing.
Per-Se markets its products and services primarily to integrated healthcare
delivery networks, hospitals, physician practices, long-term care facilities,
home health providers and managed care providers. Per-Se serves more than 18,000
physicians and 2,000 healthcare organizations. Per-Se processes more than 80
million healthcare claims annually and its solutions manage 20 million patient
lives online. Although our customers are predominantly in North America, we also
sell our software solutions internationally, both directly and through
distribution agreements.
USE OF PROCEEDS
Per-Se Technologies will not receive any proceeds from the sale of the
shares of common stock by the selling stockholder except as otherwise described
under "Plan of Distribution."
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SELLING STOCKHOLDER
The following table sets forth certain information about the selling
stockholder. The shares covered by this prospectus will be offered and sold by
the selling stockholder pursuant to an agreement with Donaldson, Lufkin &
Jenrette Securities Corporation or through other means. See "Plan of
Distribution."
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SHARES BENEFICIALLY SHARES OFFERED SHARES BENEFICIALLY PERCENTAGE OF
OWNED BEFORE PURSUANT TO OWNED AFTER SHARES OWNED
NAME THIS OFFERING THIS OFFERING THIS OFFERING(1) AFTER THIS OFFERING
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Foundation Health
Systems, Inc. (f/k/a Health
Systems International)............. 6,200,000 6,200,000 0 0%
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(1) Assumes (i) that all of the shares of Per-Se Technologies common stock held
by the selling stockholder and being offered under this prospectus are sold
and (ii) that the selling stockholder acquires no additional shares of
Per-Se Technologies common stock prior to the completion of this offering.
CERTAIN RELATIONSHIPS BETWEEN THE SELLING STOCKHOLDER AND PER-SE TECHNOLOGIES
Per-Se Technologies acquired Health Data Sciences Corporation on May 31,
1996 in a stock-for-stock merger transaction. The selling stockholder was a
stockholder in Health Data Sciences Corporation when it was acquired by Per-Se
Technologies. The selling stockholder acquired the 6,200,000 shares covered by
this prospectus in settlement of various claims made by the selling stockholder
against Per-Se Technologies arising from that merger. In connection with that
settlement, Per-Se Technologies agreed to take certain actions necessary to
register the resale of the shares covered by this prospectus, including the
preparation and filing of a registration statement under the Securities Act of
1933 (of which this prospectus forms a part) and paying expenses associated with
the registration statement, this prospectus and sale of the shares covered by
this prospectus. In addition, the settlement agreement provides that we will
issue additional shares to the selling stockholder as may be necessary for the
selling stockholder to realize net proceeds from the sale of the shares covered
by this prospectus and any such additional shares equal $16.8 million in the
aggregate. If we are required to issue any additional shares, we will be
required to file an additional registration statement covering the resale of
those shares. Any additional shares issued to the selling stockholder are
expected to be distributed in accordance with the Plan of Distribution set forth
in this prospectus. See "Plan of Distribution" for a description of other terms
of our agreement with the selling stockholder including limitations on its right
to sell the shares and circumstances under which the selling stockholder will be
required to return unsold shares to us.
PLAN OF DISTRIBUTION
Per-Se Technologies is registering the 6,200,000 shares on behalf of the
selling stockholder. All costs, expenses and fees in connection with the
registration of the shares offered hereby, estimated to be approximately
$52,000, will be borne by Per-Se Technologies, as well as all brokerage
commissions and similar selling expenses, if any, attributable to the sale of
shares. As and when we are required to amend or update this Prospectus, we may
incur additional expenses.
The selling stockholder and Per-Se Technologies entered into a settlement
agreement that places restrictions on the price and possibly the number of
shares that may be sold by the selling stockholder. During the first sixty days
following the date of this prospectus, the selling stockholder may not sell
shares at a gross sales price below $3 13/32nds per share without the consent of
Per-Se Technologies. If within sixty days after the date of this prospectus the
selling stockholder has not received net proceeds from the sale of shares in
excess of $8,500,000, the selling stockholder is free to sell shares at any
price and without consent from Per-Se Technologies. If within 120 days after the
date of this prospectus the selling stockholder has not received net proceeds
from the sale of shares equal to $16.8 million, the selling stockholder is free
to sell shares without any price restrictions or obligations to obtain consent.
If the
10
<PAGE> 12
selling stockholder receives total net proceeds from the sale of shares in
excess of $16.8 million, the selling stockholder must return to Per-Se
Technologies any proceeds received in excess of $16.8 million and any shares
that have not been sold. Also, if at anytime the selling stockholder receives a
cash payment from Per-Se Technologies that together with the proceeds from the
sale of shares equals $16.8 million, the selling stockholder shall not be
permitted to sell any additional shares and shall return any unsold shares to
Per-Se Technologies.
Sales of shares may be effected by the selling stockholder, or by pledgees,
donees, transferees or other successors in interest. Subject to the settlement
agreement between the selling stockholder and Per-Se Technologies, sales may be
made on one or more exchanges or in the over-the-counter market, or otherwise,
at prices and at terms then prevailing or at prices related to the then current
market price, or in negotiated transactions. The selling stockholder has entered
into a non-exclusive agreement with Donaldson, Lufkin & Jenrette Securities
Corporation to assist the selling stockholder in selling the shares in one or
more types of transactions. These transactions, whether with the assistance of
Donaldson, Lufkin & Jenrette or other brokers or dealers, may include: (a) block
trades in which the broker or dealer so engaged will attempt to sell the shares
as agent but may position and resell a portion of the block as principal to
facilitate the transaction, (b) purchases by a broker or dealer as principal and
resales by such broker or dealer or for its account pursuant to the Prospectus,
as supplemented, (c) exchange distributions in accordance with the rules of such
exchange, and (d) ordinary brokerage transactions and transactions in which the
broker solicits purchasers. Such broker-dealers may receive compensation in the
form of discounts, concessions, or commissions from the selling stockholder
and/or the purchasers of shares for whom such broker-dealers may act as agents
or to whom they sell as principal, or others (which compensation as to a
particular broker-dealer might be in excess of customary commissions). The
selling stockholder also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act of 1933,
provided they meet the criteria and conform to the requirements of such Rule,
rather than pursuant to this Prospectus, as supplemented. From time to time, the
selling stockholder may engage in short sales, short sales against the box, puts
and calls and other transactions in our securities or derivatives thereof, and
may sell and deliver the shares in connection therewith.
From time to time the selling stockholder may pledge its shares pursuant to
the margin provisions of its customer agreements with its brokers. Upon a
default by the selling stockholder, the broker may offer and sell the pledges
shares from time to time as described above.
The Securities and Exchange Commission takes the position that the selling
stockholder is, and any broker-dealer that acts in connection with the sale of
shares might be deemed to be, an "underwriter" within the meaning of Section
2(11) of the Securities Act of 1933, and any commissions received by such
broker-dealers and any profit on the resale of the shares sold by them while
acting as principals might be deemed to be underwriting discounts or commissions
under such Act. Per-Se Technologies has agreed to indemnify the selling
stockholder and Donaldson, Lufkin & Jenrette Securities Corporation against
certain liabilities, including liabilities arising under the Securities Act of
1933. The selling stockholder has agreed to indemnify DLJ against certain claims
insofar as such claims are based upon information relating to the selling
stockholder furnished in writing expressly for use in the registration statement
of which this prospectus is a part, and may agree to indemnify any other agent,
dealer or broker-dealer that participates in transactions involving sales of the
shares against certain claims.
Because the Securities and Exchange Commission takes the position that the
selling stockholder is deemed to be an "underwriter" within the meaning of
Section 2(11) of the Securities Act of 1933, the selling stockholder will be
subject to the prospectus delivery requirements of such Act. Per-Se Technologies
has informed the selling stockholder that the anti-manipulative provisions of
Regulation M promulgated under the Securities Exchange Act of 1934 may apply to
its sales in the market.
The shares will be sold only through registered or licensed brokers or
dealers if required under applicable state securities laws. In addition, in
certain states the shares may not be sold unless they have
11
<PAGE> 13
been registered or qualified for sale in the applicable state or an exception
from the registration or qualification requirement is available and is complied
with.
LEGAL MATTERS
A legal opinion to the effect that the shares offered hereby by the selling
stockholder are validly issued, fully paid and non-assessable has been rendered
by Randolph L. M. Hutto, Esq., Atlanta, Georgia, Executive Vice President and
General Counsel of Per-Se Technologies.
EXPERTS
The consolidated financial statements of Per-Se Technologies, Inc.
incorporated in this prospectus by reference to the Annual Report on Form 10-K
of Per-Se Technologies, Inc. for the year ended December 31, 1998 have been so
incorporated in reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
12
<PAGE> 14
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
Registration fee to Securities and Exchange Commission...... $ 6,032.60
Accounting fees and expenses................................ 25,000.00
Legal fees and expenses..................................... 15,000.00
Miscellaneous expenses...................................... 6,000.00
----------
Total............................................. $52,032.60
==========
</TABLE>
The foregoing items, except for the registration fee to the Securities and
Exchange Commission, are estimated. Per-Se Technologies has agreed to bear all
expenses in connection with the registration of the shares being offered by the
selling stockholder.
ITEM 15. 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 as it currently
exists or is later amended.
Under Section 145 of the Delaware General Corporation Law, 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 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 persons 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
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<PAGE> 15
Delaware General Corporation Law 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 Delaware General
Corporation Law 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 $150,000 and an annual per occurrence and
aggregate cap on coverage of $50 million.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
<C> <C> <S>
1.0 -- Form of Take Down Agreement by and among Foundation Health
Systems, Inc., Donaldson, Lufkin & Jenrette Securities
Corporation and Registrant.
4.1 -- Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1 of the
Registrant's Registration Statement on Form S-1, File No.
33-42216).
4.2 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3 of Registrant's Quarterly Report on
Form 10-Q for the quarterly period ended March 31, 1993).
4.3 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.3 of Registrant's Registration
Statement on Form 8-A/A filed March 28, 1995).
4.4 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 4.4 of Registrant's Registration
Statement on Form S-8, Registration No. 333-03213).
4.5 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.5 of Registrant's Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 1997).
4.6 -- Amended and Restated By-Laws of the Registrant (incorporated
by reference to Exhibit 3.5 of Registrant's Quarterly Report
on Form 10-Q for the quarterly period ended September 30,
1998).
4.7 -- Rights Agreement, dated as of February 11, 1999, between the
Registrant and American Stock Transfer & Trust Company
(incorporated by reference to Exhibit 4 of the Registrant's
Current Report on Form 8-K filed February 12, 1999).
4.8 -- Registration Rights Agreement, dated as of September 20,
1999, by and between Foundation Health Systems, Inc. (f/k/a
Health Systems International, Inc.) and the Registrant
(incorporated by reference to Exhibit 4.1 of Registrant's
Current Report on Form 8-K filed September 21, 1999).
5.0 -- Opinion of Randolph L. M. Hutto, Esq. regarding the legality
of shares being registered.
10.1 -- Settlement Agreement and Release, dated September 20, 1999,
by and between Foundation Health Systems, Inc. and
Registrant (incorporated by reference to Exhibit 99.1 of
Registrant's Current Report on Form 8-K filed September 21,
1999).
23.0 -- Consent of PricewaterhouseCoopers LLP.
</TABLE>
II-2
<PAGE> 16
ITEM 17. 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 of 1933 (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 the 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% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this
Section do not apply if the Registration Statement is on Form S-3, Form
S-8 or Form F-3 and 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 Securities Exchange Act of 1934
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 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 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein and the offering of such securities at that time shall be deemed 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 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
II-3
<PAGE> 17
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.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus 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.
II-4
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 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 September 23, 1999.
PER-SE TECHNOLOGIES CORPORATION
By: /s/ ALLEN W. RITCHIE
------------------------------------
Allen W. Ritchie
President and Chief Executive
Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Allen W.
Ritchie and Randolph L.M. Hutto, and each of them, as his or her true and lawful
attorneys-in-fact and agents, with full power of substitution and resubstitution
in each of them, for him or her and in his or her name, place and stead, and in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement on Form S-3 of Per-Se Technologies
Corporation or a related registration statement filed pursuant to Rule 462(b),
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in connection therewith, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said attorneys-
in-fact and agents, or either of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on September 23, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DAVID E. MCDOWELL Chairman and Director
- -----------------------------------------------------
David E. McDowell
/s/ ALLEN W. RITCHIE President, Chief Executive Officer and
- ----------------------------------------------------- Director (Principal Executive Officer)
Allen W. Ritchie
/s/ WAYNE A. TANNER Executive Vice President and Chief Financial
- ----------------------------------------------------- Officer (Principal Financial Officer)
Wayne A. Tanner
/s/ MICHAEL SNYDER Vice President and Controller (Principal
- ----------------------------------------------------- Accounting Officer)
Michael Snyder
/s/ RODERICK M. HILLS Director
- -----------------------------------------------------
Roderick M. Hills
/s/ DAVID R. HOLBROOKE, M.D. Director
- -----------------------------------------------------
David R. Holbrooke, M.D.
</TABLE>
II-5
<PAGE> 19
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ KEVIN E. MOLEY Director
- -----------------------------------------------------
Kevin E. Moley
/s/ JOHN C. POPE Director
- -----------------------------------------------------
John C. Pope
/s/ C. CHRISTOPHER TROWER Director
- -----------------------------------------------------
C. Christopher Trower
</TABLE>
II-6
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
<C> <C> <S>
1.0 -- Form of Take Down Agreement by and among Foundation Health
Systems, Inc., Donaldson, Lufkin & Jenrette and Registrant.
4.1 -- Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1 of
Registrant's Registration Statement on Form S-1, File No.
33-42216).
4.2 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3 of Registrant's Quarterly Report on
Form 10-Q of the quarterly period ended March 31, 1993).
4.3 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.3 of Registrant's Registration
Statement on Form 8-A/A filed March 28, 1995).
4.4 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 4.4 of Registrant's Registration
Statement on Form S-8, Registration No. 333-03213).
4.5 -- Certificate of Amendment of Amended and Restated Certificate
of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.5 of Registrant's Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 1997).
4.6 -- Amended and Restated By-Laws of the Registrant (incorporated
by reference to Exhibit 3.5 of Registrant's Quarterly Report
on Form 10-Q for the quarterly period ended September 30,
1998).
4.7 -- Rights Agreement, dated as of February 11, 1999, between the
Registrant and American Stock Transfer & Trust Company
(incorporated by reference to Exhibit 4 of Registrant's
Current Report on Form 8-K filed February 12, 1999).
4.8 -- Registration Rights Agreement, dated as of September 20,
1999, by and between Foundation Health Systems, Inc. (f/k/a
Health Systems International, Inc.) and the Registrant
(incorporated by reference to Exhibit 4.1 of Registrant's
Current Report on Form 8-K filed September 21, 1999).
5.0 -- Opinion of Randolph L. M. Hutto, Esq. regarding the legality
of shares being registered.
10.1 -- Settlement Agreement and Release, dated September 20, 1999,
by and between Foundation Health Systems, Inc. and
Registrant (incorporated by reference to Exhibit 99.1 of
Registrant's Current Report on Form 8-K filed September 21,
1999).
23.0 -- Consent of PricewaterhouseCoopers LLP.
</TABLE>
<PAGE> 1
EXHIBIT 1.0
FORM OF TAKE DOWN AGREEMENT
This AGREEMENT, dated as of September , 1999, is by and among Per-Se
Technologies, Inc., a Delaware corporation formerly known as Medaphis
Corporation having its principal offices at 2840 Mt. Wilkinson Parkway Suite
300, Atlanta, Georgia 30339 (the "COMPANY"), Foundation Health Systems, Inc., a
Delaware corporation having its principal offices at 21650 Oxnard Street,
Woodland Hills, California 91367 ("FOUNDATION") and Donaldson, Lufkin & Jenrette
Securities Corporation, a Delaware corporation having its principal offices at
277 Park Avenue, New York, New York 10172 ("DLJ").
WITNESSETH:
WHEREAS, the Company has filed a registration statement (the "INITIAL
REGISTRATION STATEMENT"), including a prospectus (the "PROSPECTUS"), on Form S-3
(File No. 333- ) relating to up to 6,200,000 shares (the "ORIGINAL
SHARES") of Common Stock, $.01 par value per share (the "COMMON STOCK") of the
Company in satisfaction of the rights of Foundation under a Settlement Agreement
and Release (the "SETTLEMENT AGREEMENT") dated September 20, 1999 by and between
the Company and Foundation and a Registration Rights Agreement (the
"REGISTRATION RIGHTS AGREEMENT") dated September 20, 1999 between the Company
and Foundation;
WHEREAS, upon notice from Foundation, the Company will file a registration
statement (the "SUBSEQUENT REGISTRATION STATEMENT" and, together with the
Initial Registration Statement, the "REGISTRATION STATEMENT") relating to the
additional shares, if any, (the "ADDITIONAL SHARES" and, together with the
Original Shares, the "SHARES") to be issued to Foundation pursuant to the
Settlement Agreement (all references to the Registration Statement or the
Prospectus shall include documents incorporated therein by reference);
WHEREAS, DLJ may, from time to time, offer and sell such Shares on behalf
of Foundation; and
WHEREAS, DLJ may be deemed to be an "underwriter" within the meaning of the
Securities Act of 1933, as amended (the "SECURITIES ACT");
NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth, the parties hereto hereby agree as follows:
1. AGREEMENTS OF THE COMPANY
(a) To advise DLJ promptly and, if requested by DLJ, to confirm such advice
in writing, (i) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information, (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the suspension
of qualification of the Shares for offering or sale in any jurisdiction, or the
initiation of any proceeding for such purposes, (iii) when any amendment to the
Registration Statement becomes effective, and (iv) of the happening of any event
during the period referred to in Section 1(d) below which makes any statement of
a material fact made in the Registration Statement or the Prospectus untrue or
which requires any additions to or changes in the Registration Statement or the
Prospectus in order to make the statements therein not misleading. If at any
time the Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, the Company will use its best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time.
(b) To furnish to DLJ 2 signed copies of the Registration Statement as
first filed with the Commission and of each amendment to it, including all
exhibits, and to furnish to DLJ such number of conformed copies of the
Registration Statement as so filed and of each amendment to it, without
exhibits, as DLJ may reasonably request.
1
<PAGE> 2
(c) To prepare the Prospectus, the form and substance of which shall be
satisfactory to DLJ and Foundation, and to file the Prospectus in such form with
the Commission within the applicable period specified in Rule 424(b) under the
Act; during the period specified in Section 1(d) below, not to file any further
amendment to the Registration Statement and not to make any amendment or
supplement to the Prospectus of which DLJ and Foundation shall not previously
have been advised or to which DLJ or Foundation shall reasonably object after
being so advised; and, during such period, to prepare and file with the
Commission, promptly upon DLJ's and Foundation's reasonable request, any
amendment to the Registration Statement or amendment or supplement to the
Prospectus which may be necessary or advisable in connection with the
distribution of the Shares by you, and to use its best efforts to cause any such
amendment to the Registration Statement to become promptly effective.
(d) Prior to 10:00 A.M., New York City time, on the first business day
after the date of this Agreement and from time to time thereafter for such
period as in the opinion of counsel for DLJ and Foundation a prospectus is
required by law to be delivered in connection with sales by DLJ or a dealer, to
furnish in New York City to DLJ and any dealer as many copies of the Prospectus
(and of any amendment or supplement to the Prospectus and any documents
incorporated therein by reference) as DLJ or such dealer may reasonably request.
(e) If during the period specified in Section 1(d) above, any event shall
occur or condition shall exist as a result of which, in the opinion of counsel
for DLJ or Foundation, it becomes necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not misleading,
or if, in the opinion of counsel for DLJ or Foundation, it is necessary to amend
or supplement the Prospectus to comply with applicable law, forthwith to prepare
and file with the Securities and Exchange Commission (the "Commission") an
appropriate amendment or supplement to the Prospectus so that the statements in
the Prospectus, as so amended or supplemented, will not in the light of the
circumstances when it is so delivered, be misleading, or so that the Prospectus
will comply with applicable law, and to furnish to DLJ and to any dealer as many
copies thereof as DLJ or such dealer may reasonably request.
(f) To make available to DLJ and to Foundation all financial and other
information concerning its business and operations which DLJ or Foundation
reasonably request and will provide access to the Company's officers, directors,
employees, independent accountants and legal counsel.
(g) Prior to any offer or sale of the Shares, and each time the Company
prepares or files financial statements, the Company shall provide DLJ and
Foundation with:
(i) A certificate signed by the Company's Chief Executive Officer or
Chief Financial Officer confirming that the representation and warranties
of the Company in this Agreement are true and correct on and as of the date
of such certificate with the same force and effect as if made on and as of
such date, and that the Company has complied with all of the agreements
herein contained and required to be complied with or satisfied by the
Company on or prior to such date.
(ii) A letter, in form and substance satisfactory to DLJ and
Foundation, from PricewaterhouseCoopers LLC, independent public
accountants, containing the information and statements of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information
contained in the Registration Statement and the Prospectus.
(iii) An opinion (satisfactory to DLJ, Foundation and their respective
counsel) to the effect that the Registration Statement and the Prospectus
and any supplement or amendment thereto (except for the financial
statements and other financial data included therein as to which no opinion
need be expressed) comply as to form with the Act, (A) such counsel has no
reason to believe that at the time the financial statements were prepared,
the Registration Statement and the Prospectus included therein (except for
the financial statements and other financial data as to which such counsel
need not express any belief) contain any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and
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(C) such counsel has no reason to believe that the Prospectus, as amended
or supplemented, if applicable (except for the financial statements and
other financial data, as aforesaid) contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
(h) Once the obligations of the Company are satisfied under the Settlement
Agreement and the Registration Rights Agreements, the Company shall instruct DLJ
in writing to stop offering and selling the Shares. DLJ may continue to offer
and sell the Shares until it receives such instructions.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
(a) (i) Each document, if any, filed, or to be filed pursuant to the
Securities Exchange Act of 1934 as amended (the "Exchange Act") and incorporated
by reference in the Prospectus complied or will comply when so filed in all
material respects with the Act; (ii) the Registration Statement when it became
effective, did not contain and, as amended, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
(iii) the Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the Act,
and (iv) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph do not apply to
statements or omissions in the Registration Statement or the Prospectus based
upon information relating to DLJ or Foundation furnished to the Company in
writing by DLJ or Foundation expressly for use therein.
(b) The consolidated financial statements included or incorporated by
reference in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), together with related schedules and notes, present fairly
the consolidated financial position, results of operations and changes in
financial position of the Company and its subsidiaries on the basis stated
therein at the respective dates or for the respective periods to which they
apply; such statements and related schedules and notes have been prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, except as disclosed therein; the supporting
schedules, if any, included in the Registration Statement present fairly in
accordance with generally accepted accounting principles the information
required to be stated therein; and the other financial and statistical
information and data set forth in the Registration Statement and the Prospectus
(and any amendment or supplement thereto) are, in all material respects,
accurately presented and prepared on a basis consistent with such financial
statements and the books and records of the Company.
3. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless DLJ and its
affiliates, Foundation and its affiliates and the respective directors,
officers, agents and employees and each person, if any, who controls DLJ or
Foundation within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act (collectively, "DLJ PARTIES" or the "FOUNDATION
PARTIES"), from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with investigating or defending any matter, including any action,
that could give rise to any such losses, claims, damages liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any amendment
thereof), or the Prospectus (as amended or supplemented), or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading (a
"CLAIM"), except insofar as any Claim is based upon information relating to DLJ
or Foundation, as the case may be, furnished to the Company in writing by DLJ or
Foundation, as the case may be, expressly for use in the Registration Statement
or Prospectus. The Company shall not indemnify DLJ for any liability caused by
DLJ's failure to deliver a prospectus in connection with its sale of the Shares.
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<PAGE> 4
(b) Foundation agrees to indemnify and hold harmless the DLJ Parties and
the Company and its affiliates, and the respective directors, officers, agents
and employees and each person, if any, who controls the Company within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act (collectively, "COMPANY PARTIES"), from and against any and all Claims, but
only insofar as such Claim is based upon information relating to Foundation
furnished to the Company or DLJ in writing by Foundation expressly for use in
the Registration Statement or Prospectus. Foundation shall not indemnify DLJ for
any liability caused by DLJ's failure to deliver a prospectus in connection with
its sale of the Shares.
(c) DLJ agrees to indemnify and hold harmless the Company Parties and the
Foundation Parties from and against any and all Claims, but only insofar as such
Claim is based upon information relating to DLJ furnished to the Company in
writing by DLJ expressly for use in the Registration Statement or Prospectus.
(d) In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to this Agreement (the "INDEMNIFIED
PARTY"), the indemnified party shall promptly notify the person against whom
such indemnity may be sought (the "INDEMNIFYING PARTY") in writing and the
indemnifying party shall assume the defense of such action, including the
employment of counsel reasonably satisfactory to the indemnified party and the
payment of all fees and expenses of such counsel, as incurred.
(e) Any indemnified party shall have the right to employ separate counsel
in any such action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of the indemnified party unless
(i) the employment of such counsel shall have been specifically authorized in
writing by the indemnifying party, (ii) the indemnifying party shall have failed
to assume the defense of such action or employ counsel reasonably satisfactory
to the indemnified party or (iii) the named parties to any such action
(including any impleaded parties) include both the indemnified party and the
indemnifying party, and the indemnified party shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party (in
which case the indemnifying party shall not have the right to assume the defense
of such action on behalf of the indemnified party). In any such case, the
indemnifying party shall not, in connection with any one action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for all indemnified parties and all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by DLJ
in the case of parties indemnified pursuant to Sections 3(a) and 3(b) and the
Company in the case of parties indemnified pursuant to Section 3(c).
(f) The indemnifying party shall indemnify and hold harmless the
indemnified party from and against any and all Claims by reason of any
settlement of any action (i) effected with its written consent or (ii) effected
without its written consent if the settlement is entered into more than twenty
business days after the indemnifying party shall have received a request from
the indemnified party for reimbursement for the fees and expenses of counsel (in
any case where such fees and expenses are at the expense of the indemnifying
party) and, prior to the date of such settlement, the indemnifying party shall
have failed to comply with such reimbursement request. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement or compromise of, or consent to the entry of judgment with respect
to, any pending or threatened action in respect of which the indemnified party
is or could have been a party and indemnity or contribution may be or could have
been sought hereunder by the indemnified party, unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability on claims that are or could have been the subject
matter of such action and (ii) does not include a statement or an admission of
fault; culpability or a failure to act, by or on behalf of the indemnified
party.
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4. CONTRIBUTION
(a) To the extent the indemnification provided for in this Agreement is
unavailable to an indemnified party or insufficient in respect of any Claim,
then each indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such Claim (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party, on the one hand, and the
indemnified party, on the other hand, from the sale or (ii) if the allocation
provided by clause 4(a) (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 4(a) (i) above but also the relative fault of the indemnifying
party, on the one hand, and indemnified party, on the other hand in connection
with the Claim, as well as any other relevant equitable considerations. The
relative benefits received by either the Company on the one hand, and DLJ, on
the other hand, shall be deemed to be in the same proportion as the total net
proceeds from the sale of Shares (after deducting commissions, but before
deducting expenses) received by Foundation and the total commissions received by
DLJ bear to the total price of the Shares sold. The parties acknowledge that the
sale of the Shares constitutes payment of the settlement to Foundation, and
Foundation shall be deemed not to be receiving any benefit therefrom. The
relative fault of the Company, Foundation and DLJ shall be determined by
reference to, among other things, whether the Claim relates to information
supplied by the Company, Foundation or DLJ, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent the
misstatement or omission or alleged misstatement or omission causing such Claim.
(b) The Company, Foundation and DLJ agree that it would not be just and
equitable if contribution pursuant to this Section 4 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Claim
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred
by such indemnified party in connection with investigating or defending any
Claim.
(c) Notwithstanding the provisions of this Section 4, DLJ shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Shares sold by it exceeds the amount of any damages which DLJ
has otherwise been required to pay by reason of such Claim.
(d) No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution provisions contained in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any DLJ Parties, any Company Parties or any Foundation Parties and (iii) the
sale of any Shares.
5. MISCELLANEOUS
(a) The remedies provided for in this Agreement are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(b) This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which together constitute a single
instrument, with the same legal effect as if all signatures appeared on the same
instrument.
(c) This Agreement, its enforcement, and any disputes among the parties
hereto shall be governed by the law of the State of New York, excluding its
conflict of laws rules, and its provisions shall be binding upon the parties
hereto and their successors and assigns.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above mentioned.
PER-SE TECHNOLOGIES, INC.
By:
--------------------------------------
Name:
Title:
FOUNDATION HEALTH SYSTEMS, INC.
By:
--------------------------------------
Name:
Title:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:
--------------------------------------
Name:
Title:
6
<PAGE> 1
EXHIBIT 5.0
September 24, 1999
Securities and Exchange Commission
450 Fifth Street
Washington, D.C.
Re: Form S-3 Registration Statement relating to 6,200,000 shares of common
stock, par value $.10 per share, of Per-Se Technologies, Inc.
Ladies and Gentlemen:
I am General Counsel of Per-Se Technologies, Inc., a Delaware corporation
("Per-Se"), and have acted in such capacity in connection with the preparation
of the Registration Statement on Form S-3 filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Registration
Statement"), relating to 6,200,000 shares of Per-Se common stock, par value $.10
per share ("Common Stock"), to be sold be a stockholder of Per-Se (the "Selling
Stockholder") in accordance with the Plan of Distribution set forth in the
Registration Statement.
As such counsel, I have examined and relied upon such records, documents,
certificates and other instruments as is my judgment are necessary or
appropriate to form a basis for the opinions hereinafter set forth. In all such
examinations, I have assumed the genuineness of signatures on original documents
and the conformity to such original documents of all copies submitted to me as
certified, conformed or photographic copies, and as to certificates of public
officials, I have assumed the same to have been properly given and to be
accurate.
Based on the foregoing, I am of the opinion that:
(i) Per-Se is a corporation incorporated and validly existing in good
standing under the laws of the State of Delaware; and
(ii) The outstanding shares of Common Stock to be sold by the Selling
Stockholder have been duly authorized and are validly issued, fully paid
and nonassessable.
I consent to the filing of this opinion as an Exhibit to the Registration
Statement and to the reference to me under the caption "Legal Matters" in the
Prospectus that forms a part of the Registration Statement.
Very truly yours,
/s/ RANDOLPH L.M. HUTTO
Randolph L.M. Hutto
<PAGE> 1
EXHIBIT 23.0
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our reports dated February 10, 1999 relating to the
financial statements and financial statement schedule, which appear in the
Per-Se Technologies, Inc. (formerly Medaphis Corporation) Annual Report on Form
10-K for the year ended December 31, 1998. We also consent to the reference to
us under the heading "Experts" in such Registration Statement.
PricewaterhouseCoopers LLP
Atlanta, Georgia
September 24, 1999
