8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

November 3, 2005

Date of Report (Date of earliest event reported)

EMDEON CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	0-24975	94-3236644
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

669 River Drive, Center 2
Elmwood Park, New Jersey 07407-1361
(Address of principal executive offices, including zip code)

(201) 703-3400

(Registrant’s telephone number, including area code)

(Former name or address, if changed since last report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	Item 1.01. Entry into a Material Definitive Agreement
	Item 2.02. Results of Operations and Financial Condition
	Item 7.01. Regulation FD Disclosure
	Item 8.01. Other Events.
	Item 9.01. Financial Statements and Exhibits
SIGNATURE
EXHIBIT INDEX
EX-99.1 PRESS RELEASE, DATED NOVEMBER 3, 2005
EX-99.2 FINANCIAL TABLES ACCOMPANYING EXHIBIT 99.1
EX-99.3 FINANCIAL GUIDANCE SUMMARY

     All statements contained in this Current Report on Form 8-K, other than statements of historical fact, are forward-looking statements, including those regarding: guidance on our future financial results and other projections or measures of our future performance; the amount and timing of the benefits expected from strategic initiatives and acquisitions or from deployment of new or updated technologies, products, services or applications; and other potential sources of additional revenue. These statements are based on our current plans and expectations and involve risks and uncertainties that could cause actual future events or results to be different than those described in or implied by such forward-looking statements. These risks and uncertainties include those relating to: market acceptance of our products and services; operational difficulties relating to combining acquired companies and businesses; our ability to form and maintain mutually beneficial relationships with customers and strategic partners; changes in economic, political or regulatory conditions or other trends affecting the healthcare, Internet, information technology and plastics industries, including matters relating to the Health Insurance Portability and Accountability Act of 1996 (HIPAA); and our ability to attract and retain qualified personnel. Further information about these matters can be found in our other Securities and Exchange Commission filings. We expressly disclaim any intent or obligation to update these forward-looking statements.

* * * *

     Exhibit 99.1 furnished with this Current Report on Form 8-K includes financial measures in accordance with accounting principles generally accepted in the United States of America, or GAAP, as well as non-GAAP financial measures, each of which is expected to be discussed on the Analyst and Investor Conference Call referred to in Exhibit 99.1. The non-GAAP financial measures include: our income before restructuring, taxes, non-cash and other items; our income before taxes, non-cash and other items; and related per share amounts. Exhibit 99.2 to this Current Report includes a reconciliation of the historical non-GAAP financial measures to historical GAAP financial measures. Exhibit 99.3 to this Current Report includes a reconciliation of forward-looking non-GAAP financial measures to forward-looking GAAP financial measures. We believe that the above non-GAAP measures, and changes in those measures, are meaningful indicators of our company’s performance and provide additional information that our management finds useful in evaluating such performance and in planning for future periods. Accordingly, we believe that such additional information may be useful to investors. The non-GAAP financial measures should be viewed as supplemental to, and not as an alternative for, the GAAP financial measures.

Item 1.01. Entry into a Material Definitive Agreement

     Effective November 3, 2005, Andrew Corbin, who is currently our Chief Financial Officer, was appointed Chief Executive Officer of our Emdeon Practice Services segment. Emdeon Practice Services provides physician practice management and electronic health record software and services. Mr. Corbin served as Interim President of Emdeon Practice Services for the first six months of 2005. Mr. Corbin will also continue to serve as our Chief Financial Officer through our release of year end financial results for 2005 and the filing of the Annual Report on Form 10-K due in early 2006.

     On November 3, 2005, we entered into a letter agreement with Mr. Corbin setting forth the changes in his title and responsibilities described above and acknowledging the mutual agreement of the parties with respect to the changes. Except for the modifications described above, our existing employment agreement with Mr. Corbin continues in effect.

     In connection with his appointment as Chief Executive Officer of Emdeon Practice Services, Mr. Corbin will receive grants, effective November 4, 2005, of (a) options to purchase 200,000 shares of Emdeon common stock at an exercise price equal to the closing price on that date and (b) 40,000 shares of restricted Emdeon common stock. The vesting schedule for the options is as follows: 22% on May 1, 2007; 24% on May 1, 2008; 26% on May 1, 2009; and 28% on May 1, 2010. The vesting schedule for the shares of restricted Emdeon common stock is as follows: 22% on the first anniversary of the grant date; 24% on the second anniversary; 26% on the third anniversary; and 28% on the fourth anniversary.

2

Item 2.02. Results of Operations and Financial Condition

     On November 3, 2005, we issued a press release announcing our results for the quarter ended September 30, 2005. A copy of the press release is attached as Exhibit 99.1. Exhibit 99.1 is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. The press release was accompanied by the financial tables incorporated by reference into Item 8.01, below.

Item 7.01. Regulation FD Disclosure

     Exhibit 99.3 to this Current Report includes forward-looking financial information expected to be discussed on the previously announced conference call with investors and analysts to be held by us at 4:45 p.m., Eastern time, today (November 3, 2005). The call can be accessed at www.emdeon.com (in the About Emdeon section) and a replay will be available at the same location. Exhibit 99.3 is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 8.01. Other Events.

     On November 3, 2005, we issued a press release announcing our results for the quarter ended September 30, 2005. Attached hereto as Exhibit 99.2 and incorporated by reference herein are financial tables that accompanied the press release announcing our results.

* * *

     On November 3, 2005, we announced an increase to $200 million in the amount available for repurchases of Emdeon common stock under our stock repurchase program, an increase of approximately $145 million from the amount that remained available under the prior authorization. Under our stock repurchase program, we may purchase shares of Emdeon common stock from time to time in the open market, through block trades or in private transactions, depending on market conditions and other factors.

Item 9.01. Financial Statements and Exhibits

(c)     Exhibits

          The following exhibits are furnished herewith:

99.1	Press Release, dated November 3, 2005, regarding the Registrant’s results for the quarter ended September 30, 2005
99.2	Financial Tables accompanying Exhibit 99.1
99.3	Financial Guidance Summary

3

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	EMDEON CORPORATION
Dated: November 3, 2005	By:	/s/ Lewis H. Leicher
		Lewis H. Leicher
		Senior Vice President

4

EXHIBIT INDEX

Exhibit
Number	Description
99.1	Press Release, dated November 3, 2005, regarding the Registrant’s results for the quarter ended September 30, 2005
99.2	Financial Tables accompanying Exhibit 99.1
99.3	Financial Guidance Summary

5

EX-99.1

EXHIBIT 99.1

Contacts:	Media:
Investors:	Jennifer Meyer
Risa Fisher	jmeyer@emdeon.com
rfisher@emdeon.com	212-624-3912
201-414-2002

EMDEON REPORTS THIRD QUARTER RESULTS

ANDREW CORBIN APPOINTED CEO OF EMDEON PRACTICE SERVICES

STOCK REPURCHASE PROGRAM INCREASED TO $200 MILLION

ELMWOOD PARK, NJ (November 3, 2005) — Emdeon Corporation (NASDAQ: HLTH) today announced financial results for the three months ended September 30, 2005.

Key Financial Highlights
Revenue for the third quarter was $323.2 million compared to $299.6 million a year ago, an increase of 7.9%. Income before taxes, non-cash and other items for the third quarter was $48.4 million or $0.13 per share compared to $38.0 million or $0.11 per share a year ago. Net income for the third quarter was $14.1 million or $0.04 per share compared to $8.2 million or $0.02 per share a year ago.

As of September 30, 2005, Emdeon had approximately $832 million in cash and short and long-term marketable debt securities.

“While our financial results were at the low end of our expectations for the third quarter, our goals remain unchanged, we believe our strategies are sound and we remain well positioned to deliver accelerated growth in 2006,” said Kevin Cameron, Chief Executive Officer of Emdeon Corporation.

Segment Operating Results
Emdeon Business Services revenue was $190.5 million for the third quarter compared to $174.6 million in the prior year period, an increase of 9.1%. The increase in Emdeon Business Services revenue was attributable to the acquisition of ViPS as well as growth in our paid-claims communications services and patient statement services. Income before taxes, non-cash and other items was $35.9 million compared to $31.8 million in the prior year. Operating margins increased as a result of decreases in HIPAA related expenses and lower transaction related expenses.

Emdeon Practice Services revenue was $75.5 million for the third quarter compared to $76.9 million in the prior year, a decrease of 1.9%. Income before taxes, non-cash and other items was $7.6 million compared to $5.9 million in the prior year. Operating margins increased from 7.6% in the prior year to 10.1% as a result of revenue mix and improvements in our delivery and service infrastructure.

As previously announced on November 1, 2005, WebMD Health revenue was $45.1 million for the third quarter compared to $37.0 million in the prior year period, an increase of 21.8%, driven by continued growth in our

online public and private portals. Income before taxes, non-cash and other items was $9.1 million compared to $8.4 million in the prior year.

Porex revenue was $20.4 million for the third quarter compared to $19.4 million in the prior year period, an increase of 5.3%. Income before taxes, non-cash and other items was $6.4 million compared to $5.8 million in the prior year.

Andrew Corbin Appointed CEO of Emdeon Practice Services
Effective immediately, Andrew Corbin, Emdeon’s Chief Financial Officer, will assume the role of Chief Executive Officer of its Emdeon Practice Services segment. Mr. Corbin will continue to serve as CFO of Emdeon Corporation through the release of its year end financial results and the filing of its Annual Report on Form 10-K in early 2006. The Company expects to name Mr. Corbin’s successor prior to the filing of its Form 10-K. Mr. Corbin served as Interim President of Emdeon Practice Service for the first six months of 2005 and under his leadership, several important initiatives were put in place and the business achieved 10% margins for the first time in several years. Mr. Cameron said, “While I regret the stop and start with Andy, let me just say that I am enthusiastic about having Andy in this position, Andy is excited to be in this position and I am very confident in his ability to continue the good things he started.”

Stock Repurchase Program Increased to $200 Million
Emdeon announced that it has increased the amount available for repurchases under its stock repurchase program to $200 million, an increase of approximately $145 million from the amount previously available. Under its stock repurchase program, Emdeon may purchase shares of its common stock from time to time in the open market, through block trades or in private transactions, depending on market conditions and other factors.

Financial Guidance
A schedule outlining the Company’s financial guidance for the remainder of 2005 is being furnished as an exhibit to a Current Report on Form 8-K being filed by the Company today with the Securities and Exchange Commission.

Analyst and Investor Conference Call
As previously announced, Emdeon will hold a conference call with investors and analysts to discuss these results at 4:45 pm (eastern) on November 3, 2005. The call can be accessed at www.emdeon.com (in the About Emdeon section). A replay of the audio webcast will be available at the same web address.

ABOUT EMDEON
Emdeon (Nasdaq: HLTH) is a leading provider of business, technology and information solutions that transform both the financial and clinical aspects of healthcare delivery. At the core of Emdeon’s vision is the commitment to connect providers, payers, employers, physicians and consumers in order to simplify business processes, to provide actionable knowledge at the right time and place and to improve healthcare quality.

     Emdeon Business Services provides revenue cycle management and clinical communication solutions that enable payers, providers and patients to improve healthcare business processes. Emdeon Practice Services provides physician practice management and electronic health record software and services that increase practice efficiency and enhance patient care. WebMD Health (Nasdaq: WBMD) provides health information services for consumers, physicians, healthcare professionals, employers and health plans through its public and private online portals and health-focused publications. Porex is a developer, manufacturer and distributor of proprietary porous plastic products and components used in healthcare, industrial and consumer applications.

*****************************

All statements contained in this press release, other than statements of historical fact, are forward-looking statements, including those regarding: guidance on our future financial results and other projections or measures of our future performance; the amount and timing of the benefits expected from strategic initiatives and acquisitions or from deployment of new or updated technologies, products, services or applications; and other potential sources of additional revenue. These statements are based on our current plans and expectations and involve risks and uncertainties that could cause actual future events or results to be different than those described in or implied by such forward-looking statements. These risks and uncertainties include those relating to: market acceptance of our products and services; operational difficulties relating to combining acquired companies and businesses; our ability to form and maintain mutually beneficial relationships with customers and strategic partners; changes in economic, political or regulatory conditions or other trends affecting the

healthcare, Internet, information technology and plastics industries, including matters relating to the Health Insurance Portability and Accountability Act of 1996 (HIPAA); and our ability to attract and retain qualified personnel. Further information about these matters can be found in our Securities and Exchange Commission filings. We expressly disclaim any intent or obligation to update these forward-looking statements.

*****************************

This press release includes both financial measures in accordance with accounting principles generally accepted in the United States of America, or GAAP, as well as non-GAAP financial measures. The non-GAAP financial measures include: our income before taxes, non-cash and other items; and related per share amounts. We believes that those non-GAAP measures, and changes in those measures, are meaningful indicators of our company’s performance and provide additional information that our management finds useful in evaluating such performance and in planning for future periods. Accordingly, we believe that such additional information may be useful to investors. The non-GAAP financial measures should be viewed as supplemental to, and not as an alternative for, the GAAP financial measures. The tables attached to this press release contain historical GAAP financial measures and a reconciliation between historical GAAP and non-GAAP financial measures. We are filing a Current Report on Form 8-K today furnishing this press release as an exhibit. Exhibit 99.3 furnished with that Current Report includes a reconciliation of certain forward-looking non-GAAP information to GAAP financial information.

*****************************

WebMD®, WebMD Health®, Emdeon™, Emdeon Business Services™, Emdeon Practice Services™ and POREX® are trademarks of Emdeon Corporation or its subsidiaries.

-Tables Follow-

EX-99.2

Exhibit 99.2

EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2005		2004			2005		2004
Revenue	$	323,153	$	299,615		$	949,643	$	852,710
Costs and expenses:
Cost of operations		182,910		168,571			537,023		495,174
Development and engineering		14,681		14,392			43,778		38,479
Sales, marketing, general and administrative		82,386		84,762			248,056		245,054
Depreciation and amortization		18,895		15,189			52,940		40,922
Legal expense		5,904		2,325			14,347		6,577
Restructuring and integration charge		—		4,535			—		4,535
Interest income		5,125		4,512			13,382		14,506
Interest expense		2,996		4,843			11,672		14,429
Other expense (income), net		1,863		(94	)		7,407		(578	)
Income before income tax provision		18,643		9,604			47,802		22,624
Income tax provision		4,536		1,435			7,680		2,979
Net income	$	14,107	$	8,169		$	40,122	$	19,645
Net income per common share:
Basic	$	0.04	$	0.03		$	0.12	$	0.06
Diluted	$	0.04	$	0.02		$	0.11	$	0.06
Weighted-average shares outstanding used in computing net income per common share:
Basic		356,091		323,004			339,576		318,978
Diluted		370,313		333,978			351,875		333,048

EMDEON CORPORATION
CONSOLIDATED SEGMENT INFORMATION
(In thousands, except per share data, unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Revenues
Emdeon Business Services	$	190,502		$	174,643		$	567,749		$	504,459
Emdeon Practice Services		75,499			76,924			227,113			219,703
WebMD Health		45,094			37,017			119,134			95,178
Porex		20,410			19,385			60,663			58,543
Inter-segment eliminations		(8,352	)		(8,354	)		(25,016	)		(25,173	)
	$	323,153		$	299,615		$	949,643		$	852,710
Income before restructuring, taxes, non-cash and other items
Emdeon Business Services	$	35,926		$	31,750		$	114,599		$	90,514
Emdeon Practice Services		7,632			5,856			20,212			8,978
WebMD Health (c)		9,077			8,441			15,100			17,572
Porex		6,385			5,823			17,846			17,140
Corporate (c)		(12,738	)		(13,571	)		(36,485	)		(38,067	)
Interest income		5,125			4,512			13,382			14,506
Interest expense		(2,996	)		(4,843	)		(11,672	)		(14,429	)
	$	48,411		$	37,968		$	132,982		$	96,214
Basic income per common share before restructuring, taxes, non-cash and other items (a)	$	0.14		$	0.12		$	0.39			0.30
Diluted income per common share before restructuring, taxes, non-cash and other items (a)	$	0.13		$	0.11		$	0.38			0.29
Restructuring, taxes, non-cash and other items (b)
Depreciation and amortization	$	(18,895	)	$	(15,189	)	$	(52,940	)	$	(40,922	)
Amortization of non-cash advertising and distribution services (included in cost of operations)		(74	)		(104	)		(291	)		(705	)
Amortization of non-cash advertising and distribution services (included in sales, marketing, general and administrative)		(1,912	)		(3,505	)		(6,708	)		(14,188	)
Non-cash stock-based compensation (included in sales, marketing, general and administrative)		(1,120	)		(2,800	)		(3,487	)		(7,241	)
Legal expense		(5,904	)		(2,325	)		(14,347	)		(6,577	)
Restructuring and integration charge		—			(4,535	)		—			(4,535	)
Other (expense) income, net		(1,863	)		94			(7,407	)		578
Income tax provision		(4,536	)		(1,435	)		(7,680	)		(2,979	)
Net income	$	14,107		$	8,169		$	40,122		$	19,645
Net income per common share:
Basic	$	0.04		$	0.03		$	0.12		$	0.06
Diluted	$	0.04		$	0.02		$	0.11		$	0.06
Weighted-average shares outstanding used in computing net income per common share:
Basic		356,091			323,004			339,576			318,978
Diluted		370,313			333,978			351,875			333,048

(a)	Basic and diluted income per common share before restructuring, taxes, non-cash and other items is based on the weighted-average shares outstanding used in computing basic and diluted income per common share.
(b)	Reconciliation of income before restructuring, taxes, non-cash and other items to net income.
(c)	Income before restructuring, taxes, non-cash and other items during prior periods, for the Corporate and WebMD Health segments, has been reclassified to reflect Corporate’s services charge to WebMD Health.

EMDEON CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

	September 30,		December 31,
	2005		2004
	(Unaudited)
Assets
Cash and cash equivalents	$	82,047	$	46,019
Stock subscription receivable		129,142		—
Short-term investments		603,360		61,675
Accounts receivable, net		230,174		204,447
Inventory		13,183		13,978
Prepaid expenses and other current assets		42,168		40,613
Total current assets		1,100,074		366,732
Marketable debt securities		147,060		511,864
Marketable equity securities		4,873		4,017
Property and equipment, net		112,786		89,677
Goodwill		1,026,998		1,010,564
Intangible assets, net		242,702		260,509
Other assets		52,257		48,871
Total Assets	$	2,686,750	$	2,292,234
Liabilities and Stockholders’ Equity
Accounts payable	$	10,669	$	17,366
Accrued expenses		168,363		201,528
Deferred revenue		111,672		99,543
Total current liabilities		290,704		318,437
Convertible notes		650,000		649,999
Other long-term liabilities		5,226		1,283
Minority interest in WebMD Health Corp.		41,506		—
Convertible redeemable exchangeable preferred stock		98,474		98,299
Stockholders’ equity		1,600,840		1,224,216
Total Liabilities and Stockholders’ Equity	$	2,686,750	$	2,292,234

EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)

	Nine Months Ended
	September 30,
	2005			2004
Cash flows from operating activities:
Net income	$	40,122		$	19,645
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		52,940			40,922
Amortization of debt issuance costs		1,856			2,255
Non-cash advertising and distribution services		6,999			14,893
Non-cash stock-based compensation		3,487			7,241
Bad debt expense		4,876			3,726
Loss (gain) on investments		3,642			(457	)
Loss on redemption of convertible debt		1,902			—
Non-cash reversal of income tax valuation allowance		4,330			—
Gain on sale of property and equipment		—			(121	)
Changes in operating assets and liabilities:
Accounts receivable		(28,861	)		(6,869	)
Inventory		795			(303	)
Accounts payable		(6,387	)		(874	)
Accrued expenses		7,913			(8,189	)
Deferred revenue		7,815			4,426
Prepaid expenses and other, net		(2,328	)		2,905
Net cash provided by operating activities		99,101			79,200
Cash flows from investing activities:
Proceeds from maturities and sales of available-for-sale securities		336,014			1,387,614
Purchases of available-for-sale securities		(516,109	)		(1,267,726	)
Purchases of property and equipment		(49,325	)		(24,889	)
Proceeds received from sale of property and equipment		400			417
Cash paid in business combinations, net of cash acquired		(74,410	)		(225,375	)
Net cash used in investing activities		(303,430	)		(129,959	)
Cash flows from financing activities:
Redemption of convertible debt		(86,694	)		—
Proceeds from issuance of common stock		43,384			30,528
Net proceeds from issuance of preferred stock		—			98,115
Net proceeds from issuance of convertible debt		289,875			—
Payments of notes payable and other		(495	)		(433	)
Purchases of treasury stock		(4,596	)		(22,267	)
Net cash provided by financing activities		241,474			105,943
Effect of exchange rates on cash		(1,117	)		(28	)
Net increase in cash and cash equivalents		36,028			55,156
Cash and cash equivalents at beginning of period		46,019			39,648
Cash and cash equivalents at end of period	$	82,047		$	94,804

EX-99.3

Exhibit 99.3

	Emdeon Corporation
	Consolidated 2005 and 2006 Financial Guidance
Amounts in thousands, except per share information
	Three Months Ended				Year Ended				Year Ended
	December 31, 2005				December 31, 2005				December 31, 2006
	Range				Range				Range
Revenues	$	320,000	$	330,000	$	1,269,643	$	1,279,643	$	1,360,000	$	1,410,000
Income before taxes, non-cash and other items	$	48,500	$	52,500	$	181,482	$	185,482	$	220,000	$	250,000
Income per share before taxes, non-cash and other items	$	0.13	$	0.14	$	0.51	$	0.52	$	0.58	$	0.66
Taxes, non-cash and other items:
Depreciation and amortization		17,000		18,000		69,940		70,940		92,500		97,000
Non-cash advertising and stock-based compensation		5,000		6,000		15,486		16,486		13,000		15,000
Legal expense		—		—		14,347		14,347		—		—
Income tax provision		3,500		4,500		11,180		12,180		22,000		30,000
Other expense		—		—		7,407		7,407		—		—
Minority interest		700		800		700		800		2,500		3,000
Net income	$	22,300	$	23,200	$	62,422	$	63,322	$	90,000	$	105,000
Net income per common share	$	0.06	$	0.06	$	0.18	$	0.18	$	0.24	$	0.28
Weighted average shares		370,000		370,000		356,000		356,000		380,000		380,000

     Background and Assumptions

• Our guidance, for all periods, does not include any unannounced acquisitions that may occur, but does include the acquisition of Conceptis Technologies Inc. announced by WebMD Health on Tuesday, November 1, 2005, and expected to close in December 2005.

• Our guidance, for all projected periods, does not include any expenses related to the Department of Justice investigation.

• Our guidance, for all periods, does not reflect the impact of expensing stock options under SFAS 123(R).

• Our guidance, for all periods, does not reflect any potential repurchases of shares of our outstanding securities.