As filed with the Securities and Exchange Commission on May 12, 1997
Registration No. 33-98328
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Post-Effective
Amendment No. 1
to
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
HCIA INC.
(Exact name of registrant as specified in its charter)
Maryland 52-1407998
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
300 East Lombard Street
Baltimore, Maryland 21202
(Address of Principal Executive Offices) (Zip Code)
-------------------------------------
HCIA INC.
1994 STOCK AND INCENTIVE PLAN
1995 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
(Full title of the plans)
------------------------------------
Charles A. Berardesco, Esquire WITH A COPY TO:
Senior Vice President and General Counsel Frank S. Jones, Esquire
HCIA INC. D. Scott Freed, Esquire
300 East Lombard Street Whiteford, Taylor & Preston L.L.P.
Baltimore, Maryland 21202 Seven Saint Paul Street
(410) 895-7470 Baltimore, Maryland 21202
(410) 347-8707
(Name, address and telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Amount Proposed maximum Proposed maximum
Title of securities to be offering price aggregate Amount of
to be registered registered per share offering price registration fee
- ---------------- ---------- --------- -------------- ----------------
<S> <C>
Common Stock (par 2,000,000(1)(2) $ 23.188(3) $ 46,376,000(3) $ 14,054(3)
value $.01 per share)
</TABLE>
(1) Together with an indeterminable number of additional shares in order to
adjust the number of shares reserved for issuance pursuant to the plans as the
result of a stock split, stock dividend or similar transaction affecting the
common stock, pursuant to 17 C.F.R. ss. 230.416.
(2) Pursuant to General Instruction E to Form S-8, the Registrant is registering
2,000,000 additional shares hereby. Of this amount, (i) 1,900,000 shares are
reserved for issuance pursuant to the terms and conditions of the HCIA Inc. 1994
Stock and Incentive Plan, as amended, and (ii) 100,000 shares are reserved for
issuance pursuant to the terms and conditions of the HCIA Inc. 1995 Non-Employee
Directors Stock Option Plan, as amended.
(3) Pursuant to Rule 457(h)(1), the proposed maximum offering price per share,
proposed maximum aggregate offering price and the amount of the registration fee
are based upon the average of the high and low prices reported on the Nasdaq
National Market on May 7, 1997 of $24 1/8 and $22 1/4 per share, respectively.
<PAGE>
Incorporation by Reference
The contents of the Registrant's Registration Statement on Form S-8
(File No. 33-98328) are incorporated herein by reference.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Amendment to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Baltimore, State of Maryland, on May 9, 1997.
HCIA INC.
By: /s/ George D. Pillari
-------------------------------
George D. Pillari,
Chairman of the Board, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act, this
Amendment has been signed by the following persons in the capacities and on the
dates indicated.
Signature Title Date
- --------- ----- ----
/s/ George D. Pillari Chairman of the Board, May 9, 1997
- -------------------------- President and Chief Executive
George D. Pillari Officer (principal executive
officer)
/s/ Barry C. Offutt Senior Vice President and May 9, 1997
- -------------------------- Chief Financial Officer
Barry C. Offutt (principal financial and
accounting officer)
/s/Richard Dulude* Director May 9, 1997
- --------------------------
Richard Dulude
/s/W. Grant Gregory* Director May 9, 1997
- --------------------------
W. Grant Gregory
/s/Phillip B. Lassiter* Director May 9, 1997
- --------------------------
Phillip B. Lassiter
- -------------------------- Director __________, 199_
Mark C. Rogers, M.D.
/s/Carl J. Schramm, Ph.D.* Director May 9, 1997
- --------------------------
Carl J. Schramm, Ph.D.
/s/ Charles A. Berardesco
- --------------------------
*by Charles A. Berardesco, as attorney-in-fact
II-3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
4.1 HCIA Inc. 1994 Stock and Incentive Plan, as amended.
4.2 Form of Non-Qualified Stock Option Agreement under the 1994 Stock and
Incentive Plan.*
4.3 Form of Incentive Stock Option Agreement under the 1994 Stock and
Incentive Plan.*
4.4 HCIA Inc. Form of Amended and Restated Non-statutory Stock
Option (incorporated by reference to Exhibit 10.6 to the
Registrant's Registration Statement on Form S-1 (33-88226)).
4.5 HCIA Inc. 1995 Non-Employee Directors Stock Option Plan, as amended.
4.6 Form of Non-Qualified Stock Option Award Agreement under the 1995
Non-Employee Directors Stock Option Plan.*
5.1 Opinion of Whiteford, Taylor & Preston L.L.P. (contains Consent of
Counsel).
23.1 Consent of Whiteford, Taylor & Preston L.L.P. (contained in Exhibit
5.1).
23.2 Consent of KPMG Peat Marwick LLP
23.3 Consent of Ernst & Young LLP
- ------------------------------------
*Previously filed.
EXHIBIT 4.1
HCIA Inc. 1994 Stock and Incentive Plan, as amended
<PAGE>
HCIA INC.
1994 STOCK AND INCENTIVE PLAN
As Amended Through May 7, 1997
Section 1. Purpose
The purpose of the HCIA Inc. 1994 Stock and Incentive Plan
(the "Plan") is to attract and retain outstanding individuals as Key Employees
of HCIA Inc. (the "Company") and its Affiliates, as hereinafter defined, and to
motivate such individuals to achieve the long-term performance goals of the
Company by providing incentives to such individuals in the form of stock
ownership or monetary payments based on the value of the capital stock of the
Company or its financial performance, or both, on the terms and conditions set
forth herein.
Section 2. Definitions
As used in the Plan and unless the context clearly indicates
otherwise, the following terms shall have the respective meanings set forth
below:
(a) "Affiliate" shall mean any entity that, directly or
indirectly, controls or is controlled by the Company.
(b) "Award" shall mean any Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit or Performance Award granted under the
Plan.
(c) "Award Agreement" shall mean any written agreement,
contract or other instrument or document evidencing any Award granted under the
Plan.
(d) "Beneficiary" shall mean the person designated by the
Participant, on a form provided by the Company, to exercise the Participant's
rights in accordance with Section 7(h) of the Plan in the event of death, or, if
no such person is designated, the estate or personal representatives of such
Participant.
(e) "Board of Directors" shall mean the Board of Directors of
the Company.
(f) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(g) "Commission" shall mean the United States Securities and
Exchange Commission or any successor agency.
<PAGE>
(h) "Committee" shall mean the Compensation Committee of the
Board of Directors. The Committee shall be composed of two or more directors,
all of whom shall be "disinterested persons" within the meaning of Rule 16b-3
and "outside directors" within the meaning of Section 162(m)(4)(C) of the Code
and any regulations issued thereunder.
(i) "Disability" shall mean a total and permanent disability
within the meaning of the Company's long-term disability plan, as amended from
time to time.
(j) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(k) "Fair Market Value" shall mean the average of the highest
and lowest selling prices of the Shares as reported on the National Association
of Securities Dealers Automated Quotation System National Market System or such
other national securities exchange as may be designated by the Committee or, in
the event that the Shares are not listed for trading on a national securities
exchange, the average of the highest and lowest quoted selling prices of the
Shares as reported by the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") or, if not listed on NASDAQ, the fair market value
of the Shares as determined in good faith by the Board of Directors or the
Committee, in any such case as of the valuation date.
(l) "Incentive Stock Option" shall mean a stock option granted
under Section 7(a) of the Plan that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto.
(m) "Key Employee" shall mean any officer or other employee of
the Company or any Affiliate who is described in Section 6 of the Plan.
(n) "Non-Qualified Stock Option" shall mean a stock option
granted under Section 7(a) of the Plan that is not intended to be an Incentive
Stock Option.
(o) "Option" shall mean an Incentive Stock Option or a
Non-Qualified Stock Option.
(p) "Participant" shall mean a Key Employee who is designated
to be granted or has received an Award under the Plan.
(q) "Performance Award" shall mean any Award granted under
Section 7(d) of the Plan.
(r) "Person" shall mean any individual, corporation,
partnership, limited liability company, association, joint-stock company, trust,
unincorporated organization or government or political subdivision thereof.
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<PAGE>
(s) "Released Securities" shall mean Restricted Stock with
respect to which all applicable restrictions have expired, lapsed or been
waived.
(t) "Restricted Stock" shall mean any Shares granted and
issued under Section 7(c) of the Plan.
(u) "Restricted Stock Unit" shall mean any Award granted under
Section 7(c) of the Plan that is denominated in Shares.
(v) "Restriction Period" shall mean, with respect to
Restricted Stock or Restricted Stock Units, that period of time determined by
the Committee pursuant to Section 7(c) of the Plan.
(w) "Retirement" shall mean termination of a Participant's
employment with the Company or any Affiliate at his or her "normal retirement
date" as defined in the Company's Savings Incentive Plan or any successor plan.
(x) "Termination" shall mean any resignation or discharge from
employment with the Company or any Affiliate except in the event of Disability,
Retirement or death.
(y) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the
Commission under the Exchange Act or any successor rule or regulation thereto.
(z) "Shares" shall mean shares of the common stock, par value
$.01 per share, of the Company and such other securities or property as may
become the subject of Awards or become subject to Awards pursuant to an
adjustment made under Section 8 of the Plan.
(aa) "Stock Appreciation Right" shall mean any Award granted
under Section 7(b) of the Plan.
Section 3. Effective Date; Stockholder Approval; Termination
(a) Effective Date and Stockholder Approval. Subject to the
approval of the Plan by the stockholders of the Company in accordance with the
provisions of Rule 16b-3, the Plan shall be effective as of December 22, 1994.
(b) Termination. No Award shall be granted under the Plan
after December 31, 2004; provided, however, that any Award granted on or before
December 31, 2004 may extend beyond such date unless expressly provided
otherwise herein or in the applicable Award Agreement; provided further, to the
extent set forth in Section 8 hereof, the authority of the Committee to amend,
alter, adjust, suspend, discontinue or terminate any Award or to waive any
conditions or restrictions with respect to any Award, and the authority of the
Board of Directors to amend the Plan, shall extend beyond such date.
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<PAGE>
Section 4. Administration
(a) The Plan shall be administered by the Committee; provided,
however, that if at any time the Committee shall not be in existence, the
functions of the Committee as specified in the Plan shall be exercised by those
members of the Board of Directors who qualify as "disinterested persons" under
Rule 16b-3 and as "outside directors" under Section 162(m)(4)(C) of the Code and
any regulations issued thereunder.
Subject to the terms of the Plan and applicable law, the
Committee shall have full power and authority with respect to the Plan,
including, without limitation, the power to:
(i) designate Participants;
(ii) determine the types of Awards to be granted to each
Participant under the Plan;
(iii) determine the number of Shares to be covered by (or with
respect to which payments, rights or other matters are to be calculated in
connection with) Awards;
(iv) determine the terms and conditions of any Award;
(v) determine whether, to what extent, under what
circumstances and the method by which Awards may be settled or exercised in
cash, Shares, other securities, other Awards or other property, or canceled,
forfeited or suspended;
(vi) determine whether, to what extent and under what
circumstances cash, Shares, other securities, other Awards, other property and
other amounts payable with respect to an Award shall be deferred either
automatically or at the election of the holder thereof or of the Committee;
(vii) interpret and administer the Plan and any instrument or
agreement relating to, and any Award made under, the Plan (including, without
limitation, any Award Agreement);
(viii) establish, amend, suspend and waive such rules and
regulations and appoint such agents as it shall deem appropriate for the proper
administration of the Plan; and
(ix) make any other determination and take any other action
that the Committee deems necessary or desirable for the administration of the
Plan.
Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations and other decisions under or with
respect to the Plan, or any Award, shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive and
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<PAGE>
binding upon all Persons, including the Company, any Affiliate, any Participant,
any holder or Beneficiary of any Award, any stockholder and any employee of the
Company or any Affiliate.
The Committee shall not have the authority, without the
approval of the stockholders of the Company, to (i) amend the exercise price of
any outstanding Option without the approval of the stockholders of the Company,
(ii) cancel any outstanding Option and grant a substitute Option to the same
Optionee with an exercise price less than the exercise price of the cancelled
Option or (iii) grant an Award of Restricted Stock or a Restricted Stock Unit
which has a vesting period of less than three years. Notwithstanding the
foregoing, the Committee shall have the authority to amend the exercise price of
outstanding Options, cancel outstanding Options and award substitute Options
with an exercise price less than the exercise price of the cancelled Option
and/or grant Awards of Restricted Stock or Restricted Stock Units with vesting
periods of less than three years, provided that the aggregate number of shares
subject to such amended Options or Awards does not exceed 10% of the aggregate
number of shares with respect to which Awards may be granted under the Plan.
(b) No member of the Committee shall be liable for any action
or determination made in good faith, and the members of the Committee shall be
entitled to indemnification and reimbursement in the manner provided in the
Company's Charter and Bylaws, as amended from time to time.
(c) The Committee may designate persons other than its members
to carry out its responsibilities under such conditions or limitations as it may
set, except that the Committee may not delegate: (i) its authority with regard
to Awards (including decisions concerning the timing, pricing and amount of
Awards) granted to Key Employees who are officers or directors for purposes of
Section 16(b) of the Exchange Act; or (ii) its authority pursuant to Section 8
to amend the Plan.
Section 5. Grants of Awards; Shares Available for Award
(a) The Committee may, from time to time, grant Awards to one
or more Key Employees; provided, however, that:
(i) subject to any adjustment pursuant to Section 8,
(x) the aggregate number of Shares available with respect to which Awards may be
granted under the Plan shall be 2,350,000 and (y) the aggregate number of Shares
with respect to which Awards may be made to any one Key Employee during any
single fiscal year of the Company may not exceed 250,000.
(ii) to the extent that any Shares covered by an
Award granted under the Plan, or to which any Award relates, are forfeited, or
if an Award otherwise terminates, expires or is canceled prior to the delivery
of all of the Shares or of other consideration issuable or payable pursuant to
such Award, then the number of Shares counted against the number of Shares
available under the Plan in connection with the grant of such Award, to the
extent of any such forfeiture, termination, expiration or cancellation, shall be
available for granting of Awards under the Plan;
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<PAGE>
(iii) Shares which have been issued, or any other
shares of the capital stock of the Company, which a Participant tenders to the
Company in satisfaction of income and payroll tax withholding obligations or in
satisfaction of the exercise price of any Award shall be available for granting
of Awards under the Plan;
(iv) notwithstanding anything herein to the
contrary, the Committee may limit the application of Sections 5(a)(ii) and
5(a)(iii) in any manner that it considers necessary or appropriate to ensure
that the Plan complies with the requirements of Rule 16b-3 under the Exchange
Act or any successor provision; and
(v) notwithstanding anything herein to the contrary,
any Shares ceasing to be subject to an Award due to the exercise of an Award or
expiration of a Restriction Period shall no longer be available for granting of
Awards under the Plan.
(b) For purpose of this Section 5:
(i) if an Award is denominated in Shares, the number
of Shares covered by such Award, or to which such Award relates, shall be
counted on the date of grant of such Award against the number of Shares
available for granting of Awards under the Plan; and
(ii) if an Award is not denominated in Shares, the
number of Shares shall be counted on the date of grant of such Award against the
number of Shares available for granting Awards under the Plan equal to the
quotient of the Fair Market Value (calculated as of the date of grant) of the
maximum amount of cash or other consideration payable pursuant to such Award,
divided by the Fair Market Value of one Share on the date of grant.
(c) Any Shares delivered by the Company pursuant to an Award
may consist, in whole or in part, of authorized and unissued Shares or of
treasury Shares. In determining the size of any Award, the Committee may take
into account a Participant's responsibility level, performance, potential, cash
compensation level, the Fair Market Value of the Shares at the time of the Award
and such other considerations as it deems appropriate.
Section 6. Eligibility
Any employee, including any executive officer or
employee-director of the Company or any Affiliate, who is not a member of the
Committee and who, in the opinion of the Committee, contributes to the continued
growth, development and financial success of the Company or an Affiliate shall
be eligible to be designated as a Participant.
Section 7. Awards
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<PAGE>
(a) Options. The Committee is hereby authorized to grant
Options to Participants in the form of either Non-Qualified Stock Options or
Incentive Stock Options with the terms and conditions set forth in this Section
7 and with such additional terms and conditions, in either case not inconsistent
with the provisions of the Plan, as the Committee shall determine.
(i) Limitations on Incentive Stock Options.
(A) In the event the Committee grants Incentive
Stock Options, the aggregate Fair Market
Value (determined at the time the Incentive
Stock Options are granted) of the Shares
underlying any such Incentive Stock Options,
together with the shares underlying any
incentive stock options (as defined in
Section 422 of the Code) under any other
plans of the Company or any Affiliate, which
shall be first exercisable by any one
Participant shall not, during any calendar
year, exceed $100,000, or such other
limitation as may be provided in the Code.
(B) The grant of Incentive Stock Options
hereunder shall be subject to guidelines
adopted by the Committee with respect to the
timing and size of Incentive Stock Options.
(C) The terms of any Incentive Stock Option
granted under the Plan shall comply in all
respects with the provisions of Section 422
of the Code, or any successor provision
thereto, and any regulations promulgated
thereunder.
(ii) Exercise Price. The exercise price per Share
purchasable under an Option shall be determined by the Committee; provided,
however, that such exercise price shall not be less than the Fair Market Value
of a Share on the date of grant of the Option (or, if the Committee so
determines, in the case of any Option granted in tandem with or in substitution
for another Award or any outstanding award granted under any other plan of the
Company, on the date of grant of such other Award or award).
(iii) Option Term. The term of each Option shall be
fixed by the Committee; provided, however, that in no event shall the term of an
Incentive Stock Option exceed a period of ten years from the date of its grant.
(iv) Exercisability and Method of Exercise. Except
for such limitations as may be set forth herein, an Option shall become
exercisable in such manner and within such period or periods and in such
installments as shall be determined by the Committee and set forth in the Award
Agreement evidencing the Option. The Committee also shall determine the method
or methods by which, and the form or forms in which, payment of the exercise
price with respect to any Option may be made or deemed to have been made.
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<PAGE>
(b) Stock Appreciation Rights. The Committee is hereby
authorized to grant Stock Appreciation Rights to Participants. Subject to the
terms of the Plan and any applicable Award Agreement, a Stock Appreciation Right
granted under the Plan shall confer on the holder thereof a right to receive,
upon exercise thereof, the difference of (i) the Fair Market Value of one Share
on the date of exercise or, if the Committee shall so determine in the case of
any such right other than one related to any Incentive Stock Option, at any time
during a specified period before or after the date of exercise, less (ii) the
grant price of the right as specified by the Committee, which shall not be less
than the Fair Market Value of one Share on the date of grant of the Stock
Appreciation Right (or, if the Committee so determines, in the case of any Stock
Appreciation Right granted in tandem with or in substitution for another Award
or any outstanding award granted under any other plan of the Company, on the
date of grant of such other Award or award). Subject to the terms of the Plan
and any applicable Award Agreement, the grant price, term, methods of exercise,
methods of settlement and any other terms and conditions of any Stock
Appreciation Right shall be as determined by the Committee. The Committee may
impose such conditions or restrictions on the exercise of any Stock Appreciation
Right as it may deem appropriate, including, without limitation, restricting the
time of exercise of the Stock Appreciation Right to specified periods as may be
necessary to satisfy the requirements of Rule 16b-3.
(c) Restricted Stock and Restricted Stock Units.
(i) Issuance. The Committee is hereby authorized to
grant Awards of Restricted Stock and Restricted Stock Units to Participants,
such Awards, including the total number of Shares to which they pertain, to be
evidenced by an Award Agreement.
(ii) Restrictions. Shares of Restricted Stock and
Restricted Stock Units shall be issued in the name of the Participant without
payment of consideration, and shall be subject to such restrictions as the
Committee may impose (including, without limitation, a Restriction Period, any
limitation on the right to vote a Share of Restricted Stock or the right to
receive any dividend or other right or property), which restrictions may lapse
separately or in combination at such time or times, in such installments or
otherwise, as the Committee may deem appropriate. Different Restricted Stock or
Restricted Stock Unit Awards may, among other things, have different Restriction
Periods.
(iii) Registration. Any Restricted Stock granted
under the Plan may be evidenced in such manner as the Committee may deem
appropriate, including, without limitation, book-entry registration or issuance
of a stock certificate or certificates. In the event any stock certificate is
issued to evidence Shares of Restricted Stock granted under the Plan, such
certificate shall be registered in the name of the Participant and shall bear an
appropriate legend (as determined by the Committee) referring to the terms,
conditions and restrictions applicable to such Restricted Stock. Upon completion
of the applicable Restriction Period, the related restriction or restrictions
upon the Award shall expire and new certificates representing the Award shall be
issued without the applicable restrictive legend described herein. Such Shares
shall be delivered in accordance with the terms and conditions of such
Participant's Award Agreement.
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<PAGE>
(d) Other Stock or Stock-Based Awards. An Award other than as
described in (a) through (c) above may be granted pursuant to which Shares are,
or in the future may be acquired, or which is valued or determined in whole or
in part by reference to, or otherwise based upon, Shares. Any such Award must be
either (i) performance based, with a minimum vesting period of one year, or (ii)
non-performance based, which would be specifically awarded in lieu of salary
and/or bonus payments which would have otherwise been paid to the Participant.
(e) Code Section 162(m) Requirements. The Committee in its
sole discretion shall determine whether Awards made pursuant to the Plan shall
be designed to meet the requirements of performance-based compensation within
the meaning of Section 162(m) of the Code and any regulations issued thereunder.
(f) Termination of Employment. The Agreement relating to an
Award will set forth provisions governing the disposition of an Award in the
event of the retirement, disability, death or other termination of a
Participant's employment.
(g) Election to Recognize Income. If a Participant makes an
election in a timely manner pursuant to Section 83(b) of the Code to recognize
income for tax purposes when an Award is first made, the Participant shall
notify the Company within 10 days of the making of such election.
(h) General.
(i) Award Agreements. Each Award granted under the
Plan shall be evidenced by an Award Agreement in such form as shall have been
approved by the Committee.
(ii) Awards May Be Granted Separately or Together.
Awards may be granted either alone or in addition to, in tandem with, or in
substitution for any other Award or any award granted under any other plan of
the Company or any Affiliate. Awards granted in addition to or in tandem with
other Awards, or in addition to or in tandem with awards granted under any other
plan of the Company or any Affiliate, may be granted either at the same time as
or at a different time from the grant of such other Awards or awards.
(iii) Forms of Payment Under Awards. Subject to the
terms of the Plan and of any applicable Award Agreement, payments or transfers
to be made by the Company or any Affiliate upon the grant, exercise or payment
of an Award may be made in such form or forms as the Committee shall determine,
including, without limitation, cash, Shares, other securities, other Awards or
other property, or any combination thereof, and may be made in a single payment
or transfer, in installments or on a deferred basis, in each case in accordance
with the rules and procedures established by the Committee. Such rules and
procedures may include, without limitation, provisions for the payment or
crediting of interest in installments or deferred payments.
(iv) Limits on Transfer of Awards. No Award (other
than Released Securities), except as otherwise provided by the Committee in its
discretion, and no right under any such Award, shall be assignable, alienable,
saleable or transferable by a Participant otherwise than
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<PAGE>
by will or by the laws of descent and distribution or pursuant to a qualified
domestic relations order as defined in the Code or Title I of ERISA (or, in the
case of an Award of Restricted Stock, to the Company); provided, however, that,
if so determined by the Committee, a Participant may, in the manner established
by the Committee, designate a Beneficiary to exercise the rights of the
Participant, and to receive any property distributable with respect to any Award
upon the death of the Participant. Each Award, and each right under any Award,
shall be exercisable, during the Participant's lifetime, only by the Participant
or, if permissible under applicable law, by the Participant's guardian or legal
representative. No Award (other than Released Securities), and no right under
any such Award, may be pledged, alienated, attached or otherwise encumbered, and
any purported pledge, alienation, attachment or encumbrance thereof shall be
void and unenforceable against the Company or any Affiliate.
(v) Term of Awards. Except as otherwise provided
herein, the term of each Award shall be for such period as may be determined by
the Committee.
(vi) Share Certificates and Representation by
Participants. All certificates for Shares or other securities delivered under
the Plan pursuant to any Award or the exercise thereof shall be subject to such
stop transfer orders and other restrictions as the Committee may deem advisable
under the Plan or the rules, regulations and other requirements of the
Commission, any stock exchange or other market upon which such Shares or other
securities are then listed or traded, and any applicable federal or state
securities laws, and the Committee may cause a legend or legends to be inscribed
upon any such certificate(s) to make appropriate reference to such restrictions.
The Committee may require each Participant or other Person who acquires Shares
or other securities under the Plan to represent to the Company in writing that
such Participant or other Person is acquiring the Shares or other securities
without a view to the distribution thereof.
Section 8. Amendment and Termination; Adjustments; Corrections
(a) Amendments to the Plan. The Committee may, at any time or
from time to time, amend, alter, suspend, discontinue or terminate the Plan in
whole or in part; provided, however, that no amendment, alteration, suspension,
discontinuation or termination of the Plan shall in any manner (except as
otherwise provided in this Section 8) adversely affect the rights of any
Participant under any Award granted and then outstanding under the Plan, without
the consent of the respective Participant; provided further, however, that any
amendment which under the requirements of applicable law must be approved by the
stockholders of the Company shall not be effective unless and until such
stockholder approval has been obtained in compliance with such law, and
provided, further, that any amendment that must be approved by the stockholders
of the Company in order to maintain the continued qualification of the Plan
under Rule 16b-3 under the Exchange Act, or any successor provision, shall not
be effective unless and until such stockholder approval has been obtained in
compliance with such rule. No termination or amendment of the Plan may, without
the consent of the Participant to whom an Award has been granted, adversely
affect the rights of such Participant under such Award.
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<PAGE>
(b) Certain Adjustments of Awards.
(i) In the event the Company or any Affiliate shall
assume outstanding employee awards or the right or obligation to make future
such awards in connection with the acquisition of another business or business
entity, the Committee may make such adjustments in the terms of Awards, not
inconsistent with the terms of the Plan, as it shall deem appropriate in order
to achieve reasonable comparability or other equitable relationship between the
assumed awards and the Awards granted under the Plan, as so adjusted.
(ii) In the event that the Committee shall determine
that any dividend or other distribution (whether in the form of cash, Shares,
other securities or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction, change in
applicable laws, regulations or financial accounting principles or other event
affects the Shares, such that an adjustment is determined by the Committee to be
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan, then the
Committee may, in such manner as it may deem equitable, adjust any or all of:
(A) the number and type of Shares (or other securities or property) which
thereafter may be made the subject of Awards under the Plan; (B) the number and
type of Shares (or other securities or property) subject to outstanding Awards;
and (C) the grant, purchase or exercise price with respect to any Award, or, if
deemed appropriate, make provision for a cash payment to the holder of an
outstanding Award; provided, however, in each case, that with respect to Awards
of Incentive Stock Options, no such adjustment shall be authorized to the extent
that such authority would cause the Plan to violate Section 422(b)(1) of the
Code or any successor provision thereto; provided further, that the number of
Shares subject to any Award denominated in Shares shall always by a whole
number. The foregoing adjustments shall be determined by the Committee in its
sole discretion.
(c) Correction of Defects, Omissions and Inconsistencies. The
Committee may correct any defect, supply any omission or reconcile any
inconsistency in any Award or Award Agreement in the manner and to the extent it
shall deem desirable to carry the Plan into effect.
Section 9. General Provisions
(a) No Rights to Awards. No Key Employee, Participant or other
Person shall have any claim to be granted any Award under the Plan, and there is
no obligation for uniformity of treatment of Key Employees, Participants or
holders or Beneficiaries of Awards under the Plan. The terms and conditions of
Awards need not be the same with respect to each Participant.
(b) Withholding. No later than the date as of which an amount
first becomes includable in the gross income of a Participant for federal income
tax purposes with respect to any Award under the Plan, the Participant shall pay
to the Company, or make arrangements satisfactory to the Company regarding the
payment of, any federal, state, local or foreign taxes of any kind
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<PAGE>
required by law to be withheld with respect to such amount. Unless otherwise
determined by the Committee, withholding obligations arising with respect to
Awards under the Plan may be settled with Shares (other than Restricted Stock),
including Shares that are part of, or are received upon exercise of, the Award
that gives rise to the withholding requirement. The obligations of the Company
under the Plan shall be conditioned on such payment or arrangements, and the
Company and any Affiliate shall, to the extent permitted by law, have the right
to deduct any such taxes from any payment otherwise due to the Participant. The
Committee may establish such procedures as it deems appropriate for the settling
of withholding obligations with Shares, including, without limitation, the
establishment of such procedures as may be necessary to satisfy the requirements
of Rule 16b-3.
(c) Acceleration. Except as otherwise provided hereunder, the
Committee may, in its discretion, (i) accelerate the time at which an
outstanding Award granted hereunder may be exercised and (ii) extend the
post-termination of employment exercise period of any outstanding Award. With
respect to Restricted Stock, in the event of a public tender offer for all or
any portion of the Shares of the Company, or in the event that any proposal to
merge or consolidate the Company with another entity is submitted to the
stockholders of the Company for a vote, the Committee, in its sole discretion,
may shorten or eliminate the Restriction Period consistent with the best
interests of the Company.
(d) No Right to Employment. The grant of an Award shall not be
construed as giving a Participant the right to be retained in the employ of the
Company or any Affiliate. Further, the Company or any Affiliate may at any time
dismiss a Participant from employment, free from any liability or any claim
under the Plan, unless otherwise expressly provided in the Plan or in any Award
Agreement.
(e) Unfunded Status of the Plan. Unless otherwise determined
by the Committee, the Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any Participant or
other Person. To the extent any Person holds any right by virtue of the grant of
an Award under the Plan, such right (unless otherwise determined by the
Committee) shall be no greater than the right of an unsecured general creditor
of the Company.
(f) Government and Other Regulations. The obligation of the
Company to make payment of Awards in Shares or otherwise shall be subject to all
applicable laws, rules and regulations, and to such approvals by any government
agencies as may be required. If Shares awarded hereunder may in certain
circumstances be exempt from registration under the Securities Act of 1933, as
amended, the Company may restrict its transfer in such manner as it deems
advisable to ensure such exempt status.
(g) No Restriction on Right of Company to Effect Corporate
Changes. The Plan shall not affect in any way the right or power of the Company
or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of stock or options, warrants or rights to purchase stock or of bonds,
debentures, preferred or
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prior preference stocks whose rights are superior to or affect the Shares or the
rights thereof or which are convertible into or exchangeable for the Shares, or
dissolution or liquidation of the Company, or any sale or transfer of all or any
part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
(h) Governing Law. The validity, construction and effect of
the Plan, and any rules and regulations relating to the Plan, shall be
determined in accordance with the laws of the State of Maryland, exclusive of
its conflicts of law provisions, and applicable Federal law.
(i) Severability. If any provision of the Plan, any Award
Agreement or any Award is or becomes or is deemed to be invalid, illegal or
unenforceable in any jurisdiction, or as to any Person or Award, or would
disqualify the Plan, any Award Agreement or any Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed amended
to conform to applicable laws, or, if it cannot be so construed or deemed
amended without, in the determination of the Committee, materially altering the
intent of the Plan, the Award Agreement or the Award, such provision shall be
stricken as to such jurisdiction, Person or Award, and the remainder of the
Plan, such Award Agreement and such Award shall remain in full force and effect.
(j) No Fractional Shares. No fractional Shares shall be issued
or delivered pursuant to the Plan, any Award Agreement or any Award, and the
Committee shall determine whether cash, other securities or other property shall
be paid or transferred in lieu of any fractional Shares, or whether such
fractional Shares or any rights thereto shall be canceled, terminated or
otherwise eliminated.
(k) Headings. Headings are given to the sections and
subsections of the Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of the Plan or any provision thereof.
EXHIBIT 4.5
HCIA Inc. 1995 Non-Employee Directors Stock Option
Plan, as amended
<PAGE>
HCIA INC.
1995 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
As Amended Through August 7, 1996
1. Definitions
For purposes of the Plan:
(a) "Annual Award" means an award of Options pursuant to Section 5(b)
of the Plan.
(b) "Annual Meeting" means an annual meeting of the Company's
stockholders.
(c) "Board" means the Board of Directors of the Company.
(d) "Change in Control" means
(i) the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) of the Exchange Act), other than (A) an
employee benefit plan (or related trust) sponsored or maintained by
the Company or any of its affiliates or (B) AMBAC Inc., a Delaware
corporation ("AMBAC"), AMBAC Indemnity Corporation, a Wisconsin stock
insurance corporation ("AIC") or any of their respective affiliates,
of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 30% or more of the then outstanding voting
securities of the Company entitled to vote generally in the election
of directors or of equity securities having a value equal to 30% or
more of the total value of all equity securities of the Company,
provided, however, that any securities of the Company acquired by any
individual, entity or group directly from AMBAC, AIC or any of their
respective affiliates, or from an underwriter or placement agent (or
other person or entity performing similar services) who acquired such
securities directly from AMBAC, AIC or any of their respective
affiliates, shall not be included in the number of shares acquired by
such individual, entity or group for purposes of determining whether a
Change in Control has occurred; or
(ii) individuals who as of the Offering Date constitute the
Board, and subsequently elected members of the Board whose election is
approved or recommended by at least a majority of such current members
or their successors whose election was so approved or recommended,
cease for any reason to constitute at least a majority of such Board.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
<PAGE>
(f) "Committee" means the committee designated by the Board pursuant to
Section 3(c) of the Plan.
(g) "Common Stock" means the Common Stock of the Company, par value $.01
per share, or such other class or kind of shares or other securities as may be
applicable under Section 12.
(h) "Company" means HCIA Inc., a Maryland corporation, or any successor to
substantially all its business.
(i) "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
(j) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(k) "Fair Market Value" means the average of the highest and the lowest
quoted selling prices of the Common Stock as reported on the National
Association of Securities Dealers Automated Quotation System National Market
System or such other national securities exchange as may be designated by the
Committee or, in the event that the Common Stock is not listed for trading on a
national securities exchange, the average of the highest and lowest quoted
selling prices of the Common Stock as reported by the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), in any such case for
the applicable valuation date or, if there were no sales on such valuation date,
for the most recent day for which there was such a sale.
(l) "Initial Award" means an award of Options pursuant to Section 5(a) of
the Plan.
(m) "Non-Employee Director" means a member of the Board who is not an
employee of the Company or any of its subsidiaries and is not an employee of
AMBAC, AIC or any of their respective subsidiaries while AMBAC and AIC maintain,
in the aggregate, an equity interest in the Company representing 25% or more of
the voting power of the Company's outstanding voting stock.
(n) "Offering Date" means the effective date of the Company's registration
statement no. 33-88226 relating to the initial public offering of the Common
Stock.
(o) "Option" means an option to purchase shares of Common Stock awarded to
a Non-Employee Director pursuant to the Plan.
(p) "Option Shares" means the shares of Common stock issuable upon exercise
of an Option.
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(q) "Permanent Disability" means a physical or mental impairment rendering
a Non-Employee Director substantially unable to function as a member of the
Board for any period of six consecutive months. Any dispute as to whether a
Non-Employee Director is Permanently Disabled shall be resolved by a physician
mutually acceptable to the Non-Employee Director and the Company, whose decision
shall be final and binding upon the Non-Employee Director and the Company.
(r) "Plan" means the HCIA Inc. 1995 Non-Employee Directors Stock Option
Plan as described herein.
(s) "Retirement" means a Non-Employee Director ceasing to be a member of
the Board as a result of retirement from the Board in accordance with the
retirement policy then applicable to Board members.
(t) "1933 Act" means the Securities Act of 1933, as amended.
2. Purpose
The purpose of the Plan is to retain the services of qualified persons who
are not employees of the Company to serve as members of the Board and to secure
for the Company the benefits of the incentives inherent in increased Common
Stock ownership by Non-Employee Directors, by granting to such person options to
purchase shares of Common Stock.
3. Shares Available; Administration
(a) Subject to the provisions of Section 12 of the Plan, the maximum number
of shares of Common Stock which may be issued under the Plan shall not exceed
200,000 shares. Either authorized and unissued shares of Common Stock or
treasury shares may be delivered upon exercise of Options awarded pursuant to
the Plan.
(b) If Options have been forfeited to the Company as described in Section
6(d), the Options Shares underlying such Options shall again be available for
issuance in connection with future awards under the Plan.
(c) The Plan will be administered by a committee designated by the Board
and composed exclusively of members of the Board who are not Non-Employee
Directors (the "Committee"). The Committee may adopt rules and regulations
necessary to carry out the Plan's purposes. The Committee's interpretation and
construction of any Plan provision shall be final and conclusive.
4. Eligibility
Options awarded pursuant to the Plan shall be granted only to Non-Employee
Directors.
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<PAGE>
5. Awards
(a) Initial Award. On the date of a Non-Employee Director's initial
election or appointment to the Board (or in the case of a Non-Employee Director
who is a member of the Board as of the Offering Date, on the Offering Date),
such Non-Employee Director (including any Non-Employee Director reelected or
reappointed after a period of at least 12 calendar months during which he did
not serve on the Board) shall be granted an Initial Award consisting of an
Option to purchase 5,000 shares of Common Stock. Such Option shall have a per
share exercise price equal to the Fair Market Value of the Common Stock on the
date of award and shall be subject to the vesting schedule provided for in
Section 6(a) and the other terms and conditions provided for herein.
(b) Annual Awards. At each Annual Meeting, commencing with the Annual
Meeting held in 1995 subsequent to the Offering Date, each person who has served
as a member of the Board during the period elapsed since the immediately
preceding Annual Meeting (or in the case of the Annual Meeting held in 1995,
each person who has served as a member of the Board since the Offering Date),
and who has, during all or a portion of such service, been a Non-Employee
Director for purposes of the Plan shall be granted as of the date of such Annual
Meeting an Annual Award consisting of an Option to purchase 5,000 shares of
Common Stock (or such lesser number determined by multiplying 5,000 by a
fraction, the numerator of which is the number of full or partial months since
the immediately preceding Annual Meeting (or Offering Date, if applicable)
during which such person served on the Board in the capacity of a Non-Employee
Director, and the denominator of which is the number of full or partial months
since the immediately preceding Annual Meeting (or Offering Date, if
applicable)). Such Option shall have a per share exercise price equal to the
Fair Market Value of the Common Stock on the date of award and shall be subject
to the vesting schedule provided for in Section 6(b) and the other terms and
conditions provided for herein.
6. Vesting
(a) Vesting of Initial Awards. Initial Awards shall vest and become
exercisable as follows:
(i) An Initial Award made other than in connection with a Non-Employee
Director's initial election to the Board at an Annual Meeting shall vest
and become exercisable in two equal installments as of the first and second
anniversaries of the date of grant, provided that the Non-Employee Director
remains in service as a member of the Board until the relevant vesting
date.
(ii) An Initial Award made in connection with a Non-Employee
Director's initial election to the Board at an Annual Meeting shall vest
and become exercisable as to 50% of the Options Shares subject to the
Option constituting such Initial Award as of the date of the first Annual
Meeting following the date of award, and as to the remaining 50% of the
Option Shares subject to such Option as of the date of the second Annual
Meeting following the date of award, provided the Non-Employee Director to
whom such Annual Award was made
<PAGE>
continues in service as a member of the Board until the relevant vesting
date (whether or not the Non-Employee Director is nominated for reelection
at the Annual Meeting held on either vesting date, and whether or not, if
nominated, he is reelected).
(b) Vesting of Annual Awards. Each Annual Award shall vest and become
exercisable as of the date of the first Annual Meeting following the date of
award, provided the Non-Employee Director to whom such Annual Award was made
continues in service as a member of the Board until the vesting date (whether or
not the Non-Employee Director is nominated for reelection at the Annual Meeting
held on such vesting date, and whether or not, if nominated, he is reelected).
(c) Accelerated Vesting. Notwithstanding anything to the contrary in
Sections 6(a) and 6(b), an Option shall become fully vested and exercisable upon
the first to occur of (i) a Non-Employee ceasing to be a member of the Board as
a result of death, Permanent Disability or Retirement, or (ii) a Change in
Control of the Company.
(d) Forfeiture. In the event of a Non-Employee Director's termination of
service as a member of the Board for any reason other than death, Permanent
Disability or Retirement prior to the satisfaction of any vesting period
requirement hereof, the unvested portion of any Options awarded to the
Non-Employee Director shall be forfeited to the Company as of the date of
termination of service, and the Non-Employee Director shall have no further
right or interest therein.
7. Term of Options
(a) Ten-Year Term. Each Option shall expire ten years from its date of
award, subject to earlier termination as provided herein.
(b) Exercise Following Certain Terminations of Service. If a Non-Employee
Director's service as a member of the Board terminates for any reason other than
death, Permanent Disability or Retirement, the Non-Employee Director shall have
the right, subject to the terms and conditions hereof, to exercise the Option,
to the extent it has vested as of the date of such termination of service, at
any time within six months after the date of such termination, subject to the
earlier expiration of the Option as provided in Section 7(a). At the end of such
six-month period the Option shall expire.
(c) Exercise Following Termination of Service Due to Death, Permanent
Disability or Retirement. If a Non-Employee Director's service as a member of
the Board terminates by reason of death, Permanent Disability or Retirement, all
Options awarded to such Non-Employee Director may be exercised by such
Non-Employee Director, or by his or her estate, personal representative or
beneficiary, as the case may be, at any time within one year after the date of
termination of service, subject to the earlier expiration of the Option as
provided in Section 7(a). At the end of such one-year period the Option shall
expire.
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<PAGE>
(d) Exercise Following Termination of Service Subject to Company Policies
and Procedures on Insider Trading. Any exercise of an Option pursuant to Section
7(b) or 7(c) following termination of a Non-Employee Director's service as a
member of the Board for any reason other than death shall be subject to, and
shall be permitted only to the extent such exercise complies with, the policies
and procedures of the Company concerning insider trading that were applicable to
the Non-Employee Director on the date of such termination of service (as such
policies and procedures may be amended by the Company during the period provided
in Section 7(b) or 7(c), as the case may be, for exercise of the Option).
8. Time and Manner of Exercise
(a) Notice of Exercise. Subject to the other terms and conditions hereof, a
Non-Employee Director may exercise any Options (to the extent vested) by giving
written notice of exercise to the Company, provided, however, that no less than
10 Option Shares may be purchased upon any exercise of the Option unless the
number of Option Shares purchased at such time is the total number of Option
Shares in respect of which an Option is then exercisable, and provided, further,
that in no event shall an Option be exercisable for a fractional share. The date
of exercise of an Option shall be the later of (i) the date on which the Company
receives such written notice or (ii) the date on which the conditions provided
in Section 8(b) are satisfied. Notwithstanding any other provision of the Plan
or of the notice of award relating to an Option provided for in Section 9, no
Option may be exercised, whether in whole or in part, and no Option Shares will
be issued by the Company in respect of any such attempted exercise, at any time
when such exercise is prohibited by Company policy then in effect concerning
transactions by a Non-Employee Director in the Company's securities. In the
event that a Non-Employee Director gives written notice of exercise to the
Company at a time when such exercise is prohibited by such policy, the Company
in its sole discretion may disregard such notice of exercise or may consider
such notice to be delivered as of the first date that the Non-Employee Director
is permitted to exercise such option in accordance with such Company policy.
(b) Payment. Prior to the issuance of a certificate pursuant to Section
8(e) hereof evidencing the Option Shares in respect of which all or a portion of
an Option shall have been exercised, a Non-Employee Director shall have paid to
the Company the Option Price for all Option Shares purchased pursuant to the
exercise of such Option. Payment may be made by personal check, bank draft or
postal or express money order (such modes of payment are collectively referred
to as "cash") payable to the order of the Company in U.S. dollars or in shares
of Common Stock already owned by the Non-Employee Director valued at their Fair
Market Value as of the last business day preceding the date of exercise, or in
any combination of cash or such shares as the compensation committee of the
Board in it sole discretion may approve. Payment of the exercise price in shares
of Common Stock shall be made by delivering to the Company the share
certificate(s) representing the required number of shares, with the Non-Employee
Director signing his or her name on the back, or by attaching executed stock
powers (the signature of the Non-Employee Director must be guaranteed in either
case).
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<PAGE>
(c) Stockholder Rights. A Non-Employee Director shall have no rights as a
stockholder with respect to any shares of Common Stock issuable upon exercise of
an Option until a certificate evidencing such shares shall have been issued to
the Non-Employee Director pursuant to Section 8(e), and no adjustment shall be
made for dividends or distributions or other rights in respect of any share for
which the record date is prior to the date upon which the Non-Employee Director
shall become the holder of record thereof.
(d) Limitation on Exercise. No Option shall be exercisable unless the
Common Stock subject thereto has been registered under the Securities Act and
qualified under applicable state "blue sky" laws in connection with the offer
and sale thereof, or the Company has determined that an exemption from
registration under the Securities Act and from qualification under such state
"blue sky" laws is available.
(e) Issuance of Shares. Subject to the foregoing conditions, as soon as is
reasonably practicable after its receipt of a proper notice of exercise and
payment of the Option Price for the number of shares with respect to which the
Option is exercised, the Company shall deliver to the Non-Employee Director (or
following the Non-Employee Director's death, such other person entitled to
exercise the Option), at the principal office of the Company or at such other
location as may be acceptable to the Company and the Non-Employee Director (or
such other person), one or more stock certificates for the appropriate number of
shares of Common Stock issued in connection with such exercise. Such shares
shall be fully paid and nonassessable and shall be issued in the name of the
Non-Employee Director (or such other person).
(f) Tax Withholding. The Company shall have the right, prior to the
delivery of any certificates evidencing shares of Common Stock to be issued upon
full or partial exercise of an Option, to require a Non-Employee Director to
remit to the Company any amount sufficient to satisfy any Federal, state or
local tax withholding requirements. The Company may permit the Non-Employee
Director to satisfy, in whole or in part, such obligation to remit taxes, by
directing the Company to withhold shares of Common Stock that would otherwise be
received by the Non-Employee Director, pursuant to such rules as the Committee
may establish from time to time. The Company shall also have the right to deduct
from all cash payments made pursuant to or in connection with the Option any
Federal, state or local taxes required to be withheld with respect to such
payments.
(g) Restrictions on Transfer. An Option may not be transferred, pledged,
assigned, or otherwise disposed of, except by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
the Code or Title I of ERISA ("QDRO"). The Option shall be exercisable, during
the Participant's lifetime, only by the Participant or by the person to whom the
Option has been transferred pursuant to a QDRO. No assignment or transfer of the
Option, or of the rights represented thereby, whether voluntary or involuntary,
by operation of law or otherwise, except by will or the laws of descent and
distribution or pursuant to a QDRO, shall vest in the assignee or transferee any
interest or right in the Option, but immediately upon any attempt to assign or
transfer the Option the same shall terminate and be of no force or effect.
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(h) Non-qualified Status of Options. Options awarded under the Plan are not
intended to qualify, and shall not be treated, as an "incentive stock options"
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended.
9. Notice of Award
The terms and conditions of each award of Options shall be embodied in a
notice of award which shall contain terms and conditions not inconsistent with
the Plan and which shall incorporate the Plan by reference. Each notice of award
shall state the date on which the Options were granted, the number of shares
subject to such Option and the per share exercise price therefor.
10. Effective Date; Term of the Plan
The effective date of the Plan shall be the Offering Date. Unless earlier
terminated in accordance with Section 11 below, the term of the Plan shall
expire on the tenth anniversary of the Offering Date. After such date, no
further awards of Options may be made hereunder, but previously granted awards
shall remain outstanding subject to the terms hereof.
11. Amendments
The Board may at any time and from time to time alter, amend, suspend or
terminate the Plan in whole or in part, provided, however, that in no event may
the provisions of the Plan respecting eligibility to participate or the timing
or amount of awards be amended more frequently than once every six months, other
than to comport with changes in the Code, ERISA or any rules or regulations
thereunder, provided, further, that any amendment which under the requirements
of applicable law must be approved by the stockholders of the Company shall not
be effective unless and until such stockholder approval has been obtained in
compliance with such law, and provided, further, that any amendment that must be
approved by the stockholders of the Company in order to maintain the continued
qualification of the Plan under Rule 16b-3 under the Exchange Act, or any
successor provision, shall not be effective unless and until such stockholder
approval has been obtained in compliance with such rule. No termination or
amendment of the Plan may, without the consent of the Non-Employee Director,
affect any such person's rights under the provisions of the Plan with respect to
awards of Options which were made prior to such action.
12. Adjustment of and Changes in Common Stock
In the event of any merger, consolidation, recapitalization,
reclassification, stock dividend, distribution of property, special cash
dividend, or other change in corporate structure affecting the Common Stock, the
Committee shall make such adjustments, if any, as it considers necessary or
appropriate in the number and class of shares subject to Options or authorized
to be awarded hereunder, in order to prevent dilution or enlargement of rights.
Any new or additional
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<PAGE>
Options awarded pursuant to such adjustments shall be subject to all of the
terms and conditions of the Plan.
13. No Right to Reelection
Nothing in the Plan shall be deemed to create any obligation on the part of
the Board to nominate any of its members for reelection by the Company's
stockholders, nor confer upon any Non-Employee Director the right to remain a
member of the Board for any period of time, or at any particular rate of
compensation.
14. Governing Law
The Plan and all notices issued or agreements entered into under the Plan
shall be construed in accordance with and governed by the laws of the State of
Maryland.
15. No Restriction on Right of Company to Effect Corporate Changes
The Plan shall not affect in any way the right or power of the Company or
its stockholders to make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or its
business, or any merger or consolidation of the Company, or any issue of stock
or of options, warrants or rights to purchase stock or of bonds, debentures,
preferred or prior preference stocks whose rights are superior to or affect the
Common Stock or the rights thereof or which are convertible into or exchangeable
for Common Stock, or the dissolution or liquidation of the Company, or any sale
or transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar character or otherwise.
EXHIBIT 5.1
Opinion of Whiteford, Taylor & Preston L.L.P.
(contains Consent of Counsel)
<PAGE>
WHITEFORD, TAYLOR & PRESTON
L.L.P.
SEVEN SAINT PAUL STREET
BALTIMORE, MARYLAND 21202-1626
410 347-8700
FAX 410 347-8731
210 WEST PENNSYLVANIA AVENUE
TOWSON, MARYLAND 21204-4515
TELEPHONE 410 832-2000
FAX 410 832-2015
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30 COLUMBIA CORPORATE CENTER
10440 LITTLE PATUXENT PARKWAY
COLUMBIA, MARYLAND 21044
TELEPHONE 410 884-0700
FAX 410-884-0719
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1025 CONNECTICUT AVENUE, NW
WASHINGTON, D.C. 20036-5405
TELEPHONE 202 659-6800
FAX 202 331-0573
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1317 KING STREET
ALEXANDRIA, VIRGINIA 22314-2928
TELEPHONE 703 836-5742
FAX 703 836-0265
May 9, 1997
Board of Directors
HCIA Inc.
300 East Lombard Street
Baltimore, Maryland 21202
Re: Registration Statement on Form S-8
Gentlemen:
We have acted as counsel to HCIA Inc., a Maryland corporation
(the "Corporation"), in connection with the filing of Post-Effective Amendment
No. 1 to the Registration Statement on Form S-8 by the Corporation under the
Securities Act of 1933, as amended (the "Registration Statement"), which
Registration Statement registers the distribution of an additional: (i)
1,900,000 shares of common stock of the Corporation, par value $.01 per share
("Common Stock"), reserved for issuance to eligible employees of the Corporation
pursuant to the HCIA Inc. 1994 Stock and Incentive Plan, as amended; and (ii)
100,000 shares of Common Stock reserved for issuance to non-employee directors
of the Corporation pursuant to the HCIA Inc. 1995 Non-Employee Directors Stock
Option Plan, as amended (collectively, the "Plans"). In that capacity, we have
reviewed the Articles of Incorporation and Bylaws of the Corporation, both as
amended to date, the Registration Statement, the Plans, the originals or copies
of corporate records reflecting the corporate action taken by the Corporation
and its stockholders in connection with the approval of the Plans and amendments
thereto and the issuance of the Common Stock under the Plans and such other
instruments as we have deemed necessary for the issuance of this opinion.
Based upon the foregoing, we are of the opinion that the
Common Stock to be offered under the Plans has been duly authorized by all
requisite action on the part of the Corporation and, when issued in accordance
with the terms and conditions of the Plans, will be legally issued, fully paid
and non-assessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not admit that we are
within the category of
<PAGE>
Board of Directors
HCIA Inc.
May 9, 1997
Page 2
persons whose consent is required by Section 7 of the
Securities Act of 1933, as amended.
Very truly yours,
Whiteford, Taylor & Preston L.L.P.
EXHIBIT 23.2
Consent of KPMG Peat Marwick LLP
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors
HCIA Inc.:
We consent to the incorporation by reference in the registration statement (No.
33-98328) on Form S-8 of HCIA Inc. of our reports dated January 23, 1997
relating to the consolidated balance sheets of HCIA Inc. and subsidiaries as of
December 31, 1995 and 1996 and the related consolidated statements of
operations, changes in stockholders' equity and cash flows for each of the years
in the three-year period ended December 31, 1996 and the related schedule, which
reports appear in the December 31, 1996 annual report on Form 10-K of HCIA Inc.
KPMG Peat Marwick, LLP
Baltimore, Maryland
May 5, 1997
EXHIBIT 23.3
Consent of Ernst & Young LLP
<PAGE>
EXHIBIT 23.3
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Post-Effective Amendment No. 1 to Form S-8 No. 33-98328), pertaining
to the 1994 Stock and Incentive Plan and the 1995 Non-Employee Directors Stock
Option Plan of HCIA Inc. of our report dated January 26, 1996, except for Note
12 as to which the date is July 30, 1996, with respect to the consolidated
balance sheets of HealthVISION, Inc. as of December 31, 1995 and 1994, and the
related consolidated statements of operations, stockholders' equity and cash
flows for the year ended December 31, 1995 and for the period February 2, 1994
(inception) through December 31, 1994 and of our report dated January 12, 1996,
except for Note 8 as to which the date is July 30, 1996, with respect to the
combined balance sheet of LBA Health Care Management, Inc. and Healthcare Data
Source, Inc. (collectively, the "Predecessor Business") as of December 31, 1994,
the related combined statements of operations and retained earnings and cash
flows for the Predecessor Business for the years December 31, 1993 and 1994 and
for the period from January 1, 1995 through September 27, 1995, the balance
sheet of LBA Health Care Management, Inc. as of December 31, 1995, and the
related statements of operations and retained earnings and cash flows of LBA
Health Care Management for the period from September 28, 1995 through December
31, 1995 included in Form 8-K/A-2, filed with the Securities and Exchange
Commission by HCIA Inc.
Ernst & Young LLP
Walnut Creek, California
May 5, 1997
