<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the quarterly period ended March 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the transition period from ___________to___________
Commission file number 0-7416
SHARED MEDICAL SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 23-1704148
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
51 Valley Stream Parkway
Malvern, Pennsylvania 19355
(Address of principal executive offices) (Zip Code)
(610) 219-6300
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address, and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No____
----
On April 30, 2000, there were 27,012,963 shares of Common Stock outstanding.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
SHARED MEDICAL SYSTEMS CORPORATION
CONSOLIDATED BALANCE SHEET
------------------------------------
(Amounts in thousands)
<TABLE>
<CAPTION>
March 31 December 31
2000 1999
----------- ------------
(unaudited)
<S> <C> <C>
ASSETS
Current Assets:
Cash and short-term investments................................. $ 88,724 $104,700
Accounts receivable, net........................................ 315,765 343,399
Prepaid expenses and other current assets....................... 31,325 31,443
--------- ---------
Total Current Assets.......................................... 435,814 479,542
Property and Equipment, net...................................... 148,932 153,288
Computer Software, net........................................... 112,932 109,375
Other Assets..................................................... 171,917 173,539
--------- ---------
$869,595 $915,744
========= =========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
Current Liabilities:
Notes payable................................................... $ 47,598 $ 48,758
Current portion of capital leases............................... 2,217 2,255
Dividends payable............................................... 5,664 5,651
Accounts payable................................................ 26,414 30,934
Accrued expenses................................................ 59,670 89,399
Current deferred revenues....................................... 35,030 41,465
Accrued and current deferred income taxes....................... 23,251 28,147
--------- ---------
Total Current Liabilities..................................... 199,844 246,609
--------- ---------
Deferred Revenues................................................ 8,416 6,938
--------- ---------
Long-Term Debt and Capital Leases................................ 177,708 178,217
--------- ---------
Deferred Income Taxes............................................ 26,846 26,846
--------- ---------
Commitments and Contingencies
Stockholders' Investment:
Preferred stock, par value $.10;
authorized 1,000,000 shares; none issued...................... - -
Common stock, par value $.01; authorized
120,000,000 shares; 30,856,795 shares issued in
2000 and 30,791,605 in 1999................................... 309 308
Paid-in capital................................................ 89,638 85,723
Retained earnings.............................................. 435,869 438,876
Common stock in treasury, at cost, 3,884,920
shares in 2000 and 3,880,320 in 1999.......................... (53,532) (53,233)
Cumulative translation adjustment.............................. (15,503) (14,540)
--------- ---------
Total Stockholders' Investment................................ 456,781 457,134
--------- ---------
$869,595 $915,744
========= =========
</TABLE>
The accompanying notes are an integral part of this statement.
2
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
CONSOLIDATED STATEMENT OF INCOME
----------------------------------
(Amounts in thousands except for per share amounts)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-------------------------
2000 1999
----------- ----------
(unaudited)
<S> <C> <C>
Revenues:
Service and system fees................................. $222,088 $259,809
Hardware sales.......................................... 18,527 27,260
----------- ----------
240,615 287,069
----------- ----------
Cost and Expenses:
Operating and development............................... 128,681 121,487
Marketing and installation.............................. 68,964 92,876
General and administrative.............................. 19,509 20,103
Cost of hardware sales.................................. 15,584 21,018
Interest................................................ 3,591 2,049
----------- ----------
236,329 257,533
----------- ----------
Income Before Income Taxes............................... 4,286 29,536
Provision for Income Taxes............................... 1,629 11,223
----------- ----------
Net Income............................................... $ 2,657 $ 18,313
=========== ==========
Net Income Per Common Share:
Basic.................................................. $.10 $.69
=========== ==========
Diluted................................................ $.10 $.68
=========== ==========
Number of shares used to compute per share amounts:
Basic.................................................. 26,738 26,575
=========== ==========
Diluted................................................ 27,224 27,034
=========== ==========
Dividends Declared Per Common Share...................... $.21 $.21
=========== ==========
</TABLE>
The accompanying notes are an integral part of this statement.
3
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
------------------------------------
(Amounts in thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31
------------------------
2000 1999
---------- ----------
(unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net income......................................................................... $ 2,657 $ 18,313
Adjustments to reconcile net income to
cash flows from operating activities -
Depreciation and amortization................................................... 13,815 11,691
Asset (increase) decrease -
Accounts receivable........................................................... 27,634 2,771
Prepaid expenses and other current assets..................................... 118 1,547
Other assets.................................................................. 407 2,743
Liability increase (decrease) -
Accounts payable and accrued expenses......................................... (34,249) (34,347)
Accrued and current deferred income taxes..................................... (4,896) 7,437
Deferred revenues............................................................. (4,957) 61
Deferred income taxes......................................................... - 1,500
Other........................................................................... (557) (1,433)
---------- ----------
Net cash (used for) provided by operating
activities................................................................... (28) 10,283
---------- ----------
Cash Flows from Investing Activities:
Property and equipment additions................................................... (4,042) (11,090)
Computer software additions........................................................ (8,170) (8,888)
Equipment dispositions............................................................. 5 -
---------- ----------
Net cash used for investing activities........................................ (12,207) (19,978)
---------- ----------
Cash Flows from Financing Activities:
Dividends paid..................................................................... (5,651) (5,588)
Stock options exercised............................................................ 3,617 1,260
Notes payable (decrease) increase.................................................. (1,160) 14,688
Long-term debt and capital
lease obligation payments......................................................... (547) (1,182)
---------- ----------
Net cash (used for) provided by
financing activities......................................................... (3,741) 9,178
---------- ----------
Net Decrease in Cash and Short-Term Investments..................................... (15,976) (517)
Cash and Short-Term Investments, Beginning of Period................................ 104,700 40,070
---------- ----------
Cash and Short-Term Investments, End of Period...................................... $ 88,724 $ 39,553
========== ==========
</TABLE>
The accompanying notes are an integral part of this statement.
4
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Notes to Consolidated Financial Statements - March 31, 2000 (unaudited):
1. Basis of Presentation:
The information furnished in this Form 10-Q reflects all normal and
recurring adjustments that are, in the opinion of management, necessary for
a fair presentation of the financial statements contained herein.
2. Accounts Receivable:
At March 31, 2000 and December 31, 1999, the Company's trade accounts
receivable were reduced by allowances for doubtful accounts of $15.9
million and $16.1 million, respectively.
3. Property and Equipment:
The major classes of property and equipment at March 31, 2000 and December
31, 1999 were as follows (amounts in thousands):
March 31 December 31
2000 1999
----------- -----------
(unaudited)
Land and land improvements........ $ 11,573 $ 11,576
Buildings......................... 105,722 105,418
Equipment......................... 226,836 232,063
----------- -----------
344,131 349,057
Less accumulated depreciation
and amortization.............. 195,199 195,769
----------- -----------
$148,932 $153,288
=========== ===========
4. Computer Software:
The accumulated amortization for capitalized internally produced computer
software and purchased software at March 31, 2000 and December 31, 1999 was
$101.2 million and $96.7 million, respectively.
5. Comprehensive Income:
The Company's comprehensive income for the three months ended March 31 was
(amounts in thousands):
Quarter Ended
March 31
-------- -------
2000 1999
-------- -------
(unaudited)
Net income......................... $2,657 $18,313
Other comprehensive income:
Foreign currency translation
adjustments...................... (963) (2,073)
-------- -------
Comprehensive income............... $1,694 $16,240
======== =======
5
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
6. Business Segment Information:
Business segment information for the Company for the three months ended
March 31 was as follows (amounts in thousands):
Quarter Ended
March 31
------------------------
2000 1999
------------------------
(unaudited)
Revenues:
North America.................$203,599 $247,091
International................. 37,016 39,978
------------------------
$240,615 $287,069
========================
Pretax income/(loss):
North America................. $ 5,763 $31,706
International................. (1,477) (2,170)
------------------------
$ 4,286 $29,536
========================
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Autobahn Acquisition Corporation (the "Purchaser"), a Delaware corporation and a
wholly-owned subsidiary of Siemens Corporation, a Delaware corporation
("Siemens"), has commenced a tender offer to purchase all of the outstanding
shares of the Company's Common Stock and the associated preferred stock purchase
rights (the "Rights") issued pursuant to the Rights Agreement dated as of May 1,
1991, as amended, between the Company and ChaseMellon Shareholder Services,
L.L.C. (the Common Stock and the Rights together being referred to herein as the
"Shares"), at a purchase price of $73.00 per Share, net to the seller in cash,
upon the terms and subject to the conditions set forth in the Purchaser's Offer
to Purchase, dated May 10, 2000, and in the related Letter of Transmittal
(which, together with any amendments or supplements thereto, collectively
constitute the "Offer"). Siemens is a wholly-owned indirect subsidiary of
Siemens Aktiengesellschaft. The Offer is described in a Tender Offer Statement
on Schedule TO filed by Siemens and the Purchaser with the Securities and
Exchange Commission on May 10, 2000. The Offer is being made in accordance with
the Agreement and Plan of Merger, dated as of April 30, 2000, among Siemens, the
Purchaser and the Company (the "Merger Agreement"). The Merger Agreement
provides that, subject to the satisfaction or waiver of certain conditions,
following completion of the Offer, and in accordance with the General
Corporation Law of the State of Delaware (the "DGCL"), the Purchaser will be
merged with and into the Company (the "Merger"). Following the consummation of
the Merger, the Company will continue as the surviving corporation and will be a
wholly-owned subsidiary of Siemens. At the effective time of the Merger, each
issued and outstanding Share (other than Shares owned by Siemens, the Purchaser,
any of their respective subsidiaries, the Company or any of its subsidiaries,
which will be cancelled, and Shares, if any, held by stockholders who did not
vote in favor of the Merger Agreement and who comply with all of the relevant
provisions of Section 262 of the DGCL relating to dissenters' rights of
appraisal) will be converted into the right to receive $73.00 in cash or any
greater amount per Share paid pursuant to the Offer.
Material Changes in Financial Condition
- ---------------------------------------
The Company's financial condition remained strong through March 31, 2000. The
most significant requirements for funds now anticipated are for investments in
computer software, purchases of equipment, and payment of cash dividends. The
Company plans to fund its anticipated expenditures primarily from operations,
supplemented from time to time by short-term bank borrowings.
Currently, the Company has lines of credit with banks totaling $119.4 million,
which are primarily based on LIBOR or EURIBOR. At March 31, 2000, $71.8 million
of these lines were unused.
6
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Material Changes in Results of Operations
- -----------------------------------------
Three Months Ended March 31, 2000 Compared to the Three Months Ended March 31,
1999.
Revenues
--------
Service and system fees revenues were $222.1 million, a decrease of 14.5%
compared to the first quarter of 1999. North American revenues decreased
primarily due to lower levels of license and professional services fees.
North American first quarter 2000 revenues were negatively impacted by an
industry-wide weakness in new software sales and continued delays in
large-system implementations following the changeover to Year 2000. This
decrease was partially offset by growth in support revenues from new and
existing customers. International revenues decreased primarily due to the
strengthening of the U.S. dollar against certain European currencies,
partially offset by growth in support revenues from new and existing
customers.
Hardware revenues decreased to $18.5 million for the first quarter of
2000 from $27.2 million in the first quarter of 1999, primarily due to
lower levels of networking and mainframe system upgrades to existing
customers that process the Company's INVISION(R) product at their site.
Cost and Expenses
-----------------
Operating and development expenses increased by $7.2 million (5.9%) in
the quarter ended March 31, 2000 compared to the same period in 1999
primarily due to increased personnel and related costs.
Marketing and installation expenses decreased by $23.9 million (25.7%)
in the quarter ended March 31, 2000 compared to the same period in 1999
primarily due to decreased customer implementation costs related to
the use of external consultants.
General and administrative expenses decreased $594,000 (3.0%) in the
quarter ended March 31, 2000 compared to the same period in 1999
primarily due to decreased personnel and related costs.
Cost of hardware sales increased to 84.1% of hardware sales revenues in
the first quarter of 2000 from 77.1% in the first quarter of 1999. This
change was primarily due to the different product mixes of systems
installed in each quarter.
Interest expense was $3.6 million in the quarter ended March 31, 2000
compared to $2.0 million in the same period in 1999. This change was
attributable to a higher level of average outstanding borrowings during
the current period.
Provision for Income Taxes
--------------------------
Income taxes decreased $9.6 million in the quarter ended March 31, 2000
when compared to the same period in 1999. This change was due to a
decrease of $25.3 million in income before income taxes. The Company's
effective tax rate for federal, state, and foreign income taxes was
38.0% in the first quarter of 2000 and 1999.
Net Income
----------
Net income was $2.7 million in the quarter ended March 31, 2000
compared to $18.3 million in the quarter ended March 31, 1999 for the
reasons discussed above.
7
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Euro Conversion
- ---------------
On January 1, 1999, the participating countries of the European Union
established fixed conversion rates between their existing currencies (legacy
currencies) and the euro. Legacy currencies will remain legal tender in the
participating countries as denominations of the euro through January 1, 2002. At
that point, the participating countries of the European Union will issue new
euro-denominated bills and coins for use in cash transactions. All legacy
currencies are to be withdrawn from circulation by July 1, 2002.
The Company's European businesses have historically been conducted directly in
each country in which the Company has customers and there are currently no
significant cross border transactions among the Company's various European
operating entities. Accordingly, the Company does not anticipate that the euro
conversion will have a material impact.
While the Company believes that the measures it has taken with respect to its
internal and customer systems in preparation for the euro conversion are
adequate, certain risk factors could have a material adverse impact on the
Company's European operations including more intense competition in certain
countries as a result of the new common currency and malfunctions in critical
information systems.
Health Insurance Portability and Accountability Act
- ---------------------------------------------------
The Administrative Simplification portion of the Health Insurance Portability
and Accountability Act (HIPAA) of 1996 requires the adoption of national uniform
standards for certain administrative and financial electronic health information
transactions. All of the standards have not yet been proposed, and only some of
the standards that have been proposed have been approved in their final form.
The standards proposed thus far would establish national provider and employer
identifiers, transactional and medical code sets, and define rules for the
security and privacy of healthcare information while being stored or
transmitted. Compliance with the final rules is currently expected to be
required beginning in August 2002.
The Company has been working closely with governmental agencies, leading
healthcare providers, and other vendors to clearly define the requirements of
the HIPAA rules, to establish guidelines and best practices for compliance, and
to educate healthcare professionals on the implications of the legislation. The
Company is offering readiness assessment and education services to its customers
to assist them in preparing for HIPAA compliance, and is working to modify its
services and systems to support customer compliance with the legislation. The
Company is also assessing its procedures regarding data access and storage to
prepare for HIPAA compliance.
The Company believes that the adoption of the HIPAA standards could ultimately
lead to reduced costs for healthcare providers, and increased demand for the
Company's systems along with its outsourcing, consulting, remote processing, and
electronic data interchange services. However, it is possible that the standards
as finally adopted, including the standards yet to be proposed, could increase
the cost and time to market of new or existing systems and services.
8
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Subsequent Event
- ----------------
On April 27, 2000, the Company announced that it had reached a definitive
agreement for Torex, PLC of the United Kingdom to acquire the Company's
subsidiaries in the United Kingdom, the Netherlands, and Ireland. The
transaction was valued at approximately $25 million. Additionally, the Company
and Torex will enter into a Distributorship Agreement, which will grant Torex a
three-year exclusive right to license and sell the Company's products in the UK,
the Netherlands, and Ireland. This transaction is expected to be completed on or
about May 15, 2000.
Cautionary Note Regarding Forward-Looking Statements
- ----------------------------------------------------
This Form 10-Q contains forward-looking statements. Such statements are subject
to certain risks and uncertainties that could cause actual results to differ
materially from those reflected in such statements. Among such factors are
continuation of the current decision-making delay in the healthcare information
technology market for longer than expected; changes in length and composition of
sales cycles; non-renewals of customer contracts; inability to keep pace with
competitive, technological and market developments; failure to protect
proprietary software; delays in product development; undetected errors in
software products; customer reductions caused by health industry consolidation;
difficulties in product installation; dependence on suppliers; interruption of
availability of resources necessary to provide products and services;
difficulties encountered by the Company, customers, or others in dealing with
the euro conversion issue; inability to successfully integrate acquired business
operations; changes in economic, political and regulatory conditions on the
health industry, including but not limited to HIPAA; regulation of additional
products as medical devices by the US federal Food and Drug Administration;
fluctuations in the value of foreign currencies relative to the US dollar,
interest rates and taxes; and the risk that the transaction with Siemens
described above might not be completed.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
9
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
PART II- OTHER INFORMATION
Item 1. Legal Proceedings.
In early March 2000, the Company announced that it had received an unsolicited
proposal from Eclipsys Corporation ("Eclipsys") regarding a proposed merger with
the Company and a notice of Eclipsys' intent to nominate a majority of the
Company's Board of Directors. The Board announced that it was uninterested in a
combination of the two companies, and that it had determined to explore
strategic alternatives that may be available to the Company.
On March 3, 2000, three separate purported class action lawsuits were filed
against the Company and its Directors in the Delaware Court of Chancery. Weckel
v. Macaleer, No. 17844NC (Del. Ch.); Sherman v. Shared Medical Systems
Corporation, No. 17841NC (Del. Ch.); Weisz v. Macaleer, No. 17840NC (Del. Ch.).
A fourth such action was filed on March 7, 2000, Cavanagh v. Macaleer, No.
17868NC (Del. Ch.), a fifth and sixth on March 10, 2000, Kass v. Macaleer, No.
17880NC (Del. Ch.), Goldberg v. Macaleer, No. 17881NC (Del. Ch.), and a seventh
on April 10, 2000, Baruch v. Cadwell, No. 17981NC (Del. Ch). The class actions
are purportedly brought on behalf of a class consisting of all of the Company's
shareholders. In general, the class actions allege that the Company and its
Directors breached their fiduciary duties to the Company's shareholders in
responding to the Eclipsys proposal, and seek damages in unspecified amounts and
injunctive relief requiring the Directors to take certain specified actions in
response to the Eclipsys proposal. The Company believes that these lawsuits were
without merit when filed, and have been mooted by subsequent events. If the
lawsuits are pursued, the Company intends to defend them vigorously.
On March 6, 2000, Eclipsys filed a lawsuit in the Delaware Court of Chancery
against the Company and its Directors. Eclipsys Corporation v. Shared Medical
Systems Corporation, No. 17851NC (Del. Ch.). In the Eclipsys lawsuit, Eclipsys
sought an order compelling the Company's Board to render the Company's
Shareholders Rights Plan (the "Rights Plan") inapplicable to Eclipsys' offer,
and sought a declaration that certain provisions of the Rights Plan are invalid
under Delaware law. Eclipsys alleged that the Company's Directors' failure to
redeem the Rights Plan or otherwise render it inapplicable to the Eclipsys
proposal constituted a breach of the Directors' fiduciary duties. The Company
amended the Rights Plan to remove certain provisions challenged by Eclipsys that
had been rendered invalid by developments in Delaware law after the adoption of
the Company's Rights Plan. On March 30, 2000, Eclipsys announced that it was
withdrawing its suit against the Company and its nomination of directors. The
Company believes that the Eclipsys lawsuit is now moot and expects Eclipsys to
formally withdraw the suit.
Item 2. Changes in Securities and Use of Proceeds.
Effective as of March 27, 2000, the Company amended certain provisions of
its Shareholder Rights Agreement with ChaseMellon Shareholder Services, LLC (the
Rights Agent). The amendment deleted the requirement in the original Rights
Agreement that certain actions be authorized by "Continuing Directors" (as
defined in the original Rights Agreement), and substitutes a requirement that
such actions be approved by the Company's Board of Directors.
Effective as of May 1, 2000, the Company and ChaseMellon Shareholder Services,
LLC entered into Amendment No. 2 to the Rights Agreement which provides that,
notwithstanding any other provision of the Rights Agreement, neither the
execution and delivery of the Agreement and Plan of Merger, by and among the
Company, Siemens Corporation and Autobahn Acquisition Corporation, dated as of
April 30, 2000, as the same may be amended from time to time, nor the
performance thereof in accordance with its terms, nor any of the transactions
contemplated thereby, shall cause Siemens Corporation or Autobahn Acquisition
Corporation (or any Affiliate or Associate of either of them) to become an
Acquiring Person or an Adverse Person or cause a Distribution Date or constitute
or cause a Triggering Event, or otherwise result in the grant of any Rights to
any person under the Rights Agreement or require any outstanding Rights to be
exercised, distributed or triggered. Amendment No. 2 also amends certain
provisions concerning the Rights Agent. (Capitalized terms used have the same
respective meanings as in the Rights Agreement.)
10
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Item 6. Exhibits and Reports on Form 8-K.
(a) The following exhibits are included in this report:
No. Description
--- ---------------------------------------------------------------
(2) Plan of Acquisition, Reorganization, Arrangement, Liquidation
or Succession -
Agreement and Plan of Merger, dated April 30, 2000, among
Siemens Corporation, Autobahn Acquisition Corporation and the
Company (filed as exhibit (e)(1) to the Company's Schedule 14D-
9 filed on May 10, 2000)*
(4) Instruments defining the rights of security holders, including
indentures -
Amendment No. 1 to Rights Agreement, dated March 27, 2000,
between Shared Medical Systems Corporation and ChaseMellon
Shareholder Services, LLC as Rights Agent (filed as Exhibit 4.1
to the Company's Form 8-K filed on March 30, 2000)*
Amended and Restated Rights Agreement, dated March 27, 2000,
between Shared Medical Systems Corporation and ChaseMellon
Shareholder Services, LLC, as Rights Agent, including the
exhibits thereto, including Exhibit C thereto, the Form of
Rights Certificate (filed as Exhibit 4.2 to the Company's Form
8-K filed on March 30, 2000)*
Amendment No. 2 to Rights Agreement, dated as of May 1, 2000,
between Shared Medical Systems Corporation and ChaseMellon
Shareholder Services, LLC, as Rights Agent (filed as Exhibit
4.1 to the Company's Form 8-K filed on May 10, 2000)*
(27) Financial Data Schedule
For the Three Months Ended March 31, 2000
(b) On March 20, 2000, the Company filed a Form 8-K to announce that its
Board of Directors scheduled the Company's Annual Meeting of
Stockholders for June 9, 2000. Also on March 20, 2000, the Company
announced that its Board of Directors approved an amendment to its
shareholder rights plan that deletes all provisions requiring that
certain actions be approved by "continuing directors".
On March 30, 2000, the Company filed a Form 8-K to amend certain
provisions of its Shareholder Rights Agreement with ChaseMellon
Shareholder Services, LLC (the Rights Agent). The amendment deleted the
requirement in the Rights Agreement that certain actions be authorized
by "Continuing Directors" (as defined in the original Rights
Agreement), and substitutes a requirement that such actions be approved
by the Company's Board of Directors.
* Previously filed as indicated and incorporated by reference.
11
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Registrant
May 15, 2000 /S/Terrence W. Kyle
- ------------ ----------------------------------
Date Terrence W. Kyle
Senior Vice President, Treasurer,
and Assistant Secretary,
Principal Financial Officer and
Duly Authorized Officer
12
<PAGE>
SHARED MEDICAL SYSTEMS CORPORATION
----------------------------------
Exhibit Index
No. Description
- --- -------------------------------------------------------------------------
(2) Plan of Acquisition, Reorganization, Arrangement, Liquidation or
Succession -
Agreement and Plan of Merger, dated April 30, 2000, among Siemens
Corporation, Autobahn Acquisition Corporation and the Company (filed as
exhibit (e)(1) to the Company's Schedule 14D-9 filed on May 10, 2000)*
(4) Instruments defining the rights of security holders, including
indentures -
Amendment No. 1 to Rights Agreement, dated March 27, 2000, between Shared
Medical Systems Corporation and ChaseMellon Shareholder Services, LLC as
Rights Agent (filed as Exhibit 4.1 to the Company's Form 8-K filed on
March 30, 2000)*
Amended and Restated Rights Agreement, dated March 27, 2000, between
Shared Medical Systems Corporation and ChaseMellon Shareholder Services,
LLC, as Rights Agent, including the exhibits thereto, including Exhibit C
thereto, the Form of Rights Certificate (filed as Exhibit 4.2 to the
Company's Form 8-K filed on March 30, 2000)*
Amendment No. 2 to Rights Agreement, dated as of May 1, 2000, between
Shared Medical Systems Corporation and ChaseMellon Shareholder Services,
LLC, as Rights Agent (filed as Exhibit 4.1 to the Company's Form 8-K
filed on May 10, 2000)*
(27) Financial Data Schedule
For the Three Months Ended March 31, 2000
* Previously filed as indicated and incorporated by reference.
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 88,724
<SECURITIES> 0
<RECEIVABLES> 331,658
<ALLOWANCES> 15,893
<INVENTORY> 0
<CURRENT-ASSETS> 435,814
<PP&E> 344,131
<DEPRECIATION> 195,199
<TOTAL-ASSETS> 869,595
<CURRENT-LIABILITIES> 199,844
<BONDS> 177,708
0
0
<COMMON> 309
<OTHER-SE> 456,472
<TOTAL-LIABILITY-AND-EQUITY> 869,595
<SALES> 18,527
<TOTAL-REVENUES> 240,615
<CGS> 15,584
<TOTAL-COSTS> 197,645
<OTHER-EXPENSES> 19,509
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,591
<INCOME-PRETAX> 4,286
<INCOME-TAX> 1,629
<INCOME-CONTINUING> 2,657
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,657
<EPS-BASIC> .10
<EPS-DILUTED> .10
</TABLE>
