-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QMUu0N8/qajSUeThKyovlHxiHfKzeojP5ypP1wl9rwZsWvmsAtro0ppwo8PCS5Ti VJK3db3L5v0ho+nGd9MiPA== 0000950144-99-012045.txt : 19991022 0000950144-99-012045.hdr.sgml : 19991022 ACCESSION NUMBER: 0000950144-99-012045 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19991021 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: HEALTH RISK MANAGEMENT INC /MN/ CENTRAL INDEX KEY: 0000869486 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE AGENTS BROKERS & SERVICES [6411] IRS NUMBER: 411407407 STATE OF INCORPORATION: MN FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-41329 FILM NUMBER: 99731931 BUSINESS ADDRESS: STREET 1: 10900 HAMPSHIRE AVENUE SOUTH CITY: MINNEAPOLIS STATE: MN ZIP: 55438 BUSINESS PHONE: 6128293500 MAIL ADDRESS: STREET 1: 8000 WEST 78TH STREET CITY: MINNEAPOLIS STATE: MN ZIP: 55439 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HEALTHPLAN SERVICES CORP CENTRAL INDEX KEY: 0000942319 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE AGENTS BROKERS & SERVICES [6411] IRS NUMBER: 133787901 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 3501 FRONTAGE RD CITY: TAMPA STATE: FL ZIP: 33607 BUSINESS PHONE: 8132891000 MAIL ADDRESS: STREET 1: 3501 FRONTAGE RD CITY: TAMPA STATE: FL ZIP: 33607 SC 13D/A 1 HEALTH RISK MANAGEMENT, INC. 1 =============================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------- SCHEDULE 13D (RULE 13d - 101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO 13d-2(a) (AMENDMENT NO. 2)* HEALTH RISK MANAGEMENT, INC. (Name of Issuer) COMMON STOCK, PAR VALUE $0.01 PER SHARE (Title of Class of Securities) 421935107 (CUSIP Number) PHILLIP S. DINGLE, ESQ. EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER HEALTHPLAN SERVICES CORPORATION 3501 FRONTAGE ROAD TAMPA, FLORIDA 33607 (813) 289-1000 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) MARCH 5, 1997 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]. NOTE: Schedules filed in paper format shall include a signed original and file copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) - --------------- * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). Page 1 of 7 Pages =============================================================================== 2 SCHEDULE 13D (AMENDMENT NO. 2) CUSIP NO. 421935107 - ---------------- ------------------------------------------------------------------------------------------ 1 NAME OF REPORTING PERSONS: HEALTHPLAN SERVICES CORPORATION I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) 133787901 - ---------------- ------------------------------------------------------------------------------------------ 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ---------------- ------------------------------------------------------------------------------------------ 3 SEC USE ONLY - ---------------- ------------------------------------------------------------------------------------------ 4 SOURCE OF FUNDS* N/A (This Filing is to report a disposition, not a purchase) - ---------------- ------------------------------------------------------------------------------------------ 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] - ---------------- ------------------------------------------------------------------------------------------ 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------- ---------- --------------------------------------------------------------------- 7 SOLE VOTING POWER 0** NUMBER OF ---------- --------------------------------------------------------------------- SHARES 8 SHARED VOTING POWER BENEFICIALLY 0** OWNED BY ---------- --------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING 0** PERSON WITH ---------- --------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 0** - ---------------- ------------------------------------------------------------------------------------------ 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0** - ---------------- ------------------------------------------------------------------------------------------ 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ---------------- ------------------------------------------------------------------------------------------ 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.00%** - ---------------- ------------------------------------------------------------------------------------------ 14 TYPE OF REPORTING PERSON* HC, CO - ---------------- ------------------------------------------------------------------------------------------
* SEE INSTRUCTIONS BEFORE FILLING OUT! ** ON MARCH 5, 1997, THE REPORTING PERSON CEASED TO BE THE BENEFICIAL OWNER OF MORE THAN FIVE PERCENT OF THE SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE, OF HEALTH RISK MANAGEMENT, INC. (THE "HRMI COMMON STOCK") SUBSEQUENT TRANSACTIONS IN HRMI COMMON STOCK BY THE REPORTING PERSON WERE IMMATERIAL, AND AS OF THE DATE OF THIS FILING, THE REPORTING PERSON DOES NOT BENEFICIALLY OWN ANY SHARES OF HRMI COMMON STOCK. PAGE 2 OF 7 3 INTRODUCTION This Amendment No. 2 to Schedule 13 D ("Amendment No. 2") is intended to amend and supplement certain information set forth in the Schedule 13D filed on September 23, 1996 and the Amendment No. 1 thereto filed on October 23, 1996 (the "Initial Filings") by HealthPlan Services Corporation ("HPS"), a Delaware corporation. In this Amendment No. 2, HPS is occasionally referred to as a "Reporting Person." The capitalized terms used in the Amendment No. 2 shall have the same meaning as in the Initial Filings, unless otherwise defined herein or the context otherwise requires. ITEM 1. ABSECURITY AND ISSUER The title of the class of equity securities to which this Amendment No. 2 relates is the common stock, par value $0.01 per share (the "HRMI Common Stock"), of Health Risk Management, Inc., a Minnesota corporation ("HRMI"). The address of HRMI's principal executive office is 10900 Hampshire Ave. South, Minneapolis, Minnesota 55438. ITEM 2. IDENTITY AND BACKGROUND a) The person filing this Amendment No. 2 is HealthPlan Services Corporation ("HPS"). b) The address of HPS's principal business office is: 3501 Frontage Road, Tampa, Florida 33607. c) HPS is a Delaware corporation engaged in providing marketing, distribution, administrative and cost containment services on behalf of health care payors. The following persons, all of whom are United States Citizens, are the executive officers and directors of HPS: James K. Murray, Jr., Chairman of the Board and Chief Executive Officer of HPS since January 1998, and a director of HPS since October 1994. Mr. Murray's address is 3501 Frontage Road, Tampa, Florida 33607. William L. Bennett, Vice Chairman of the Board since January 1998, Chairman of the Board from December 1994 to December 1997, and a director of HPS since August 1994. Mr. Bennett's address is 3501 Frontage Road, Tampa, Florida 33607. Page 3 of 7 4 Joseph A. Califano, Jr., a director of HPS since 1995. Mr. Califano is Chairman and President of The National Center on Addiction and Substance Abuse at Columbia University. Mr. Califano's address is 152 W. 57th Street, 12th Floor, New York, New York 10019. Joseph S. DiMartino, a director of HPS since March, 1995. Mr. DiMartino is Chairman of the Board of approximately 168 funds in the Dreyfus Family of Mutual Funds. Mr. DiMartino's address is 22 E. 67th Street, New York, New York 10019. Vincent D. Farrell, Jr., a director of HPS since July 1997, is Managing Director and Chief Investment Officer for Spears, Benzak, Salomon & Farrell, a money management firm based in New York. Mr. Farrell's address is 45 Rockefeller Plaza, 33rd Floor, New York, New York 10111. John R. Gunn, a director of HPS since November, 1994. Since 1982, Mr. Gunn has served in various capacities for the Memorial Sloan-Kettering Cancer Center, a medical center and research institute, and is currently its Executive Vice President and Chief Operating Officer and a member of its Board of Managers. Mr. Gunn's address is 1275 York Avenue, New York, New York 10021. Nancy M. Kane, D.B.A., a director of HPS since November, 1994. Dr. Kane is an author, lecturer, and recognized expert in managed health care. Since 1980, she has been a member of the Harvard School of Public Health facility, where she has served in the Department of Health Policy and Management. Ms. Kane's address is 677 Huntington Avenue, Boston, Massachusetts 02115. David Nierenberg, a director of HPS since November, 1994. Mr. Nierenberg is President of Nierenberg Investment Management Co., Inc., an investment management company. Mr. Nierenberg's address is 19605 N.E. 8th Street, Camas, Washington 98607. James G. Niven, a director of HPS since November, 1994. Mr. Niven is a Senior Vice President of Sotheby's, an international auction house. He is also a general partner of Pioneer Associates, a venture capital investment company. Mr. Niven's address is 1334 York Avenue, New York, New York 10021. Marc I. Perkins, a director of HPS since October, 1997. Mr. Perkins is the Vice Chairman and Chief Executive Officer of Gunther International, a manufacturer of high speed inserting equipment. Mr. Perkins' address is One Winnenden Road, Norwich, Connecticut 06360. Arthur F. Weinbach, a director of HPS since February, 1997. Mr. Weinbach is Chairman and Chief Executive Officer of Automatic Data Processing, Inc. ("ADP"). Mr. Weinbach's address is One ADP Boulevard, Roseland, New Jersey 07068. Jeffrey L. Markle, Executive Vice President - Medical Loss Management of HPS. Mr. Markle's address is 3501 Frontage Road, Tampa, Florida 33607. Page 4 of 7 5 Robert R. Parker, a director of HPS since July 1998, is President and Chief Operating Officer of HPS since January 1998. Mr. Parker's address is 3501 Frontage Road, Tampa, Florida 33607. Jeffery W. Bak, Executive Vice President - Sales, Marketing, and Business Development of HPS since January 1999. Mr. Bak's address is 3501 Frontage Road, Tampa, Florida 33607. Phillip S. Dingle, Executive Vice President and Chief Financial Officer of HPS since January 1999. From August 1996 to December 1998, Mr. Dingle was Senior Vice President and Chief Counsel of HPS. Mr. Dingle's address is 3501 Frontage Road, Tampa, Florida 33607. George E. Lucco, Executive Vice President of HPS since October 1994. Mr. Lucco's address is 3401 Morse Crossing, Columbus, Ohio 43219. d) - e) During the last five years, neither HPS nor any of the executive officers or directors listed above has been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors), nor has any of them been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which any of them was or is subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION This Amendment No. 2 relates specifically to that certain Agreement Regarding Termination of Merger Agreement entered into between HPS and HRMI on March 5, 1997 (the "Termination Agreement"), for the purpose of terminating that certain Plan and Agreement of Merger between HPS and HRMI dated September 12, 1996 (the "Merger Agreement") and the transactions contemplated thereby. Accordingly, the transactions reported in the Initial Filings were not effected and no funds were utilized. ITEM 4. PURPOSE OF TRANSACTION As reported in the Initial Filings, pursuant to the Merger Agreement, HRMI was to merge with and into a subsidiary company of HPS (the "Merger"). In connection with the Merger Agreement, certain shareholders of HRMI executed Support/Voting Agreements ("Voting Agreements"). Pursuant to the Voting Agreements, each of the shareholders party thereto agreed to vote all of their shares of HRMI Common Stock to approve the Merger. Those shareholders who executed the Voting Agreements had voting power over approximately 18.1% of the outstanding shares of HRMI Common Stock, based upon the 4,415,046 shares which were then currently outstanding. On March 5, 1997 HPS and HRMI entered into the Termination Agreement, whereby the parties agreed to terminate the Merger Agreement and all of the transactions contemplated thereby. Page 5 of 7 6 Upon such termination HPS ceased to have any rights concerning the voting of HRMI Common Stock as contemplated in the Voting Agreements. HPS did not beneficially own any shares of HRMI Common Stock upon execution of the Termination Agreement. Pursuant to the terms of the Termination Agreement, HPS was to purchase 200,000 shares of unregistered HRMI Common Stock from HRMI for $12.50 per share. HPS purchased such 200,000 shares on March 10, 1997 using its working capital to effectuate the purchase. Such purchase was for investment purposes. This purchase was immaterial because it represented 4.5% of the outstanding HRMI Common Stock, and HPS never acquired 5% beneficial ownership of HRMI Common Stock thereafter. On March 20, 1998 HPS sold the 200,000 shares of HRMI Common Stock for a purchase price of $13.50 per share. The disposition was effected through a brokerage transaction and, as a result, the source of funds used by the various purchasers is not known to HPS. Upon the consummation of the disposition, HPS no longer beneficially owned any shares of HRMI Common Stock. The purpose of the sale of the 200,000 shares of HRMI Common Stock in the March 20, 1998 transaction was to liquidate HPS's investment in HRMI. Upon the execution of the Termination Agreement on March 5, 1997, HPS ceased to be the beneficial owner (solely by virtue of controlling voting power) of more than five percent of the shares of HRMI Common Stock. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER (a) - (b) The Reporting Person does not beneficially own any Shares of the Company. (c) On March 10, 1997, the Reporting Person purchased 200,000 unregistered shares of HRMI Common Stock from HRMI for a cash price of $12.50 per share. At the time of such purchase, and after giving effect thereto, HPS held 200,000 shares of HRMI Common Stock (approximately 4.5% of the outstanding shares of HRMI Common Stock). On March 20, 1998, HPS sold 200,000 shares of HRMI Common Stock in a brokerage transaction for $13.50 per share. At the time of such disposition, and after giving effect thereto, HPS no longer beneficially owned any shares of HRMI Common Stock. (d) No other person has the right to receive the proceeds from the sale being reported herein. (e) HPS ceased to be the beneficial owner of more than five percent of the shares of HRMI Common Stock on March 5, 1997. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER None. Page 6 of 7 7 ITEM 7. MATERIAL TO BE FILED AS EXHIBITS The following document is filed herewith as an exhibit to this statement: a. Agreement Regarding Termination of Merger Agreement. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. HEALTHPLAN SERVICES CORPORATION By: /s/ Phillip S. Dingle ---------------------------------- Phillip S. Dingle Executive Vice President and Chief Financial Officer Date: October 21, 1999 Page 7 of 7 8 EXHIBIT LIST 1. Agreement Regarding Termination of Merger Agreement EX-99.1 2 AGREEMENT REGARDING TERMINATION 1 AGREEMENT REGARDING TERMINATION OF MERGER AGREEMENT DATE: March 5, 1997 PARTIES: HealthPlan Services Corporation ("HPS") HealthPlan Services Alpha Corporation ("Merger Subsidiary") Health Risk Management, Inc. ("HRM") RECITALS: A. HPS is a Delaware Corporation that provides health plan management services, including distribution, enrollment, billing and collection, claims administration, and information reports and analysis, to its clients. B. HRM is a Minnesota corporation which provides medical management processes, claim administration and other products and services to its clients. C. The parties are also parties to a Plan and Agreement of Merger dated September 12, 1996. The Plan and Agreement of Merger was amended effective November 12, 1996 in accordance with a document executed by the Parties and described as the First Amendment to a Plan and Agreement of Merger (the Plan and Agreement of Merger, as amended, is referred to herein as the "Merger Agreement"). D. The Merger Subsidiary is a Delaware Corporation created to accomplish certain acts contemplated by the Merger Agreement. E. The parties desire to terminate the Merger Agreement as provided herein. F. HPS and HRM have also entered into a Joint Marketing Agreement dated September 25, 1996 (the "Marketing Agreement") pursuant to which HPS and HRM will each market the products and services of the other. Under the Marketing Agreement, each party is obligated to pay to the other party certain fees, if the other party refers a customer to it. Despite the fact that they are not consummating the merger, the parties mutually desire to continue a mutually beneficial business relationship with incentives to refer business to one another. Accordingly, the parties desire to amend the Marketing Agreement as set forth herein. G. In consideration of the foregoing, and the promises set forth below, the parties are entering into this Agreement. 2 AGREEMENTS: 1. Termination of Merger Agreement. The parties agree that the Merger Agreement shall be and hereby is terminated by mutual consent in accordance with Section 8.1 of the Merger Agreement. The parties and their respective successors and assigns hereby release, satisfy and forever discharge one another and their respective employees, agents, officers, successors and assigns of and from any and all liabilities, costs, obligations, causes of action, demands, and/or claims of any nature whatsoever, whether arising at law or in equity, which either party may have had, now may have, or may hereafter have against the other relating to or arising in connection with the Merger Agreement and the transactions contemplated thereby, from the beginning of time through the date of this Agreement, other than those, if any, arising under the provisions of Section 9.6 thereof or under this Agreement. 2. Joint Announcement. The parties agree that they shall announce the termination of the Merger Agreement by releasing the statement attached hereto as Exhibit A. The parties will, to the extent practicable, coordinate all further statements, releases or public announcements relating to this Agreement, the Merger Agreement or the Marketing Agreement and shall, in all such communications, be consistent with Exhibit A. 3. Partial Reimbursement of Expenses. The parties acknowledge that they desire to share certain expenses associated with the termination of the Merger Agreement. Accordingly, HPS shall pay HRM by wire transfer the sum of $75,000 at the Closing specified in Section 9 below, which $75,000 is in addition to the Purchase Price set forth in Section 9. 4. Care Management Agreements. Prior to or simultaneously with the execution and delivery of this Agreement, HRM has entered into three Care Management Services Agreements related to HPS or its customers. These agreements are identified as (i) a Care Management Services Agreement between HRM and HPS (for the HPS Employee Population), (ii) a Care Management Services Agreement between HRM and HPS (for TMG Fully Insured Business), and (iii) a Care Management Services Agreement between HRM and Consolidated Group, Inc. (for Arbella). The parties agree that HRM shall not be required to pay any commission to HPS, under the Marketing Agreement or otherwise, for these business relationships. 5. Marketing Agreement Commissions. The Reference Sales Fee defined in Section 3 (02) of the Marketing Agreement is hereby increased by changing the phrase "five percent (5%)" to "ten percent (10%)." 6. Confidentiality Provisions of Marketing Agreement. The provisions of Section 5 of the Marketing Agreement relating to Confidentiality shall also apply to any information deemed confidential under Section 9.6 of the Merger Agreement or under the Nondisclosure and Confidentiality Agreement entered into prior thereto, and HPS shall promptly after the date hereof return, and cause all attorneys, accountants, agents and representatives of HPS to return, to HRM all confidential information delivered by HRM in connection with the Merger Agreement or such prior Nondisclosure and Confidentiality Agreement, including but not limited to all Merger Agreement schedules, attachments thereto, agreements and other documents delivered pursuant thereto or pursuant to due diligence lists or related requests from HPS, and all copies, analyses, summaries or extracts thereof. 3 7. Covenant Not to Solicit. HRM and HPS each agrees that for 12 months from the date hereof, neither party shall, without the consent of the other party, perform work for any of the customers of the other listed on Exhibit B hereto, or shall solicit, contact or communicate with any such customers with a view to providing services to them. For purposes of this Agreement, any such act shall be deemed to be "soliciting" such customers. The parties have listed in Exhibit B, in the case of HRM, its 25 largest clients, based on aggregate revenues from such clients in the six months immediately preceding the date hereof. In the case of HPS, Exhibit B includes the 25 largest clients of the operating unity of HPS known generally as "Harrington Services," based upon the aggregate revenues to such unit from such clients in the six months immediately preceding the date hereof. Notwithstanding the foregoing, the parties agree that for two specific clients, Columbia HCA and Kaiser Permanente, HRM will not solicit brokerage distribution, premium billing, premium collections and fully insured products business and HPS will not solicit care management business. For Columbia HCA, HRM shall not solicit brokerage distribution, premium billing, premium collections and fully insured products business and HPS shall not solicit administrative service or care management business. For purposes of this Section and Section 8 of this Agreement, reference to HRM or HPS shall mean such entity and all of its affiliate companies. 8. No Solicitation of Employees. During the term of the Marketing Agreement, and for a period of one year following termination thereof, neither HRM nor HPS shall directly or indirectly solicit, employ or engage any individual who at such time is, or at any time within the preceding 12 months was, an employee of the other. 9. Purchase and Sale of HRM Stock. HPS shall purchase from HRM, and HRM shall sell to HPS, 200,000 shares of HRM's unregistered common stock (the "Shares") at a price per share of $12,50. The entire purchase price of $2,500,000 (the "Purchase Price") shall be paid to HRM by wire transfer from HPS at Closing, at which time HRM shall deliver to HPS a stock certificate representing the Shares. The Closing shall be at the time and place set by HRM and HPS, but must take place within 5 days of the date of this Agreement. 10. Representations and Warranties of HRM. HRM represents and warrants to HPS that: (i) HRM has duly authorized by all necessary corporate action the execution and delivery of this Agreement and the other acts contemplated herein; (ii) HRM has duly executed and delivered this Agreement; (iii) this Agreement constitutes the valid and binding obligation of HRM; and (iv) upon payment of the Purchase Price, the Shares shall be duly and validly issued, fully paid, and non-assessable shares of HRM common stock. 11. Representations and Warranties of HPS. HPS represents and warrants to HRM that: (i) HPS has duly authorized by all necessary corporate action the execution and delivery of this Agreement and the other acts contemplated herein; (ii) HPS has duly executed and delivered this Agreement; (iii) this Agreement constitutes the valid and binding obligation of HPS; (iv) HPS is an "accredited investor" within the meaning under the Securities act of 1933 (the "Act") and is purchasing the shares for investment for an indefinite period; (v) HPS has received copies of HRM's proxy statement for its 1996 Annual Meeting, Form 10-K for its 1996 fiscal year, Forms 10-Q for the first two quarters of its 1997 fiscal year and such other SEC filings and HRM documents as were delivered to HPS pursuant to the Merger Agreement or the Nondisclosure and Confidentiality Agreement entered into prior thereto; (vi) HPS understands that the Shares it is purchasing are characterized as "restricted shares" under the federal securities laws and that such Shares may not be resold without registration or exemption therefrom; (vii) HRM has no 4 obligation to register the Shares for resale other than as provided in Section 12 below; and (viii) the certificates representing the Shares will contain a legend substantially to the following: "The securities represented by this certificate have not been registered under either the Securities Act of 1933 or applicable state securities laws and may not be sold, transferred, signed, offered, pledged or otherwise distributed for value unless there is an effective registration under the Act and such laws covering such securities, or the Company receives an opinion of counsel acceptable to the Company that such registration is not required." 12. Piggyback Registration Rights. If at any time prior to the 12 month anniversary of the date of this Agreement, HRM determines to prepare and file a registration statement under the Securities Act of 1933 (the "Act") in connection with the offer and sale of any of its securities by its (other than a registration relating solely to the sale of securities to participants in a stock plan, a registration relating solely to a Rule 145 transaction under the Act, or a registration on any form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Shares acquired hereunder by HPS), HRM shall give written notice of such proposed registration to HPS. Upon the written request of HPS given to HRM within 20 days following receipt of HRM's notice to HPS, HRM will cause to be included in such registration all of such Shares that HPS has requested to be so included. If the proposed offering by HRM involves an underwriting, HRM shall not be required to include any of HPS's Shares in such registration unless such Shares are included in the underwriting on the same terms and conditions agreed upon between HRM and the underwriters selected by it and then only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by HRM. In the event of any cutback by the underwriter in the number of Shares include din such registration, such cutback shall be distributed pro rata among HPS and any other selling stockholders participating in such registration. HRM will bear all expenses incurred by it in the registration described in this Section. HPS shall pay all underwriting discounts and selling commissions with respect to the sale of the Shares and any fees and expenses incurred by it in the registration described in this Section. HPS shall pay all underwriting discounts and selling commissions with respect to the sale of the Shares and any fees and expenses incurred by its counsel or accountants in connection therewith. HRM will provide HPS and the underwriters customary indemnification covering the accuracy and completeness of the registration statement and prospectus involved in such registrations, and HPS will provide HRM and the underwriters customary indemnification covering the accuracy and completeness of information provided by HPS expressly for use in such registration statement and prospectus. 13. Governing Law: Forum. This Agreement shall be governed and construed in all respects in accordance with the laws of the State of Delaware (regardless of the laws that might otherwise govern under applicable Delaware principles of conflicts of law). The venue for any suit or other action or proceeding brought pursuant to or in connection with this Agreement shall be the County of Hennepin, State of Minnesota, and the parties hereto consent to the jurisdiction of the state and federal courts located therein. 14. Binding Effect. The Agreement shall be binding upon and shall inure to the benefit of the parties in their respective successors and assigns, provided, however, that nothing herein shall be construed to permit the assignment of any duty or obligation and no such assignment shall be permitted without the express written consent of all parties. 5 15. Amendments. This Agreement may not be amended or modified without the written consent of all parties. IN WITNESS WHEREOF, each party has caused this Agreement Regarding Termination of Merger Agreement to be executed on its behalf and dated as of the day and year first above written. HEALTHPLAN SERVICES CORPORATION By: /s/ William L. Bennett ------------------------------------- Its: Chairman HEALTHPLAN SERVICES ALPHA CORPORATION By: /s/ William L. Bennett ------------------------------------- Its: Chairman HEALTHRISK MANAGEMENT, INC. By: /s/ Thomas P. Clark ------------------------------------- Its: CFO -----END PRIVACY-ENHANCED MESSAGE-----