SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
(x) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
( ) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Learmonth and Burchett Management Systems
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(x) No fees required
( ) $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
Learmonth and Burchett Management Systems Plc Letterhead]
October 14, 1996
To the holders of our ordinary shares and American Depositary Receipts ("ADRs"):
It is our pleasure to invite you to the Annual General Meeting of
Learmonth & Burchett Management Systems Plc to be held on Friday, November 15,
1996 at 11:00 a.m. CST at the Company's executive offices located at 1800 West
Loop South, Suite 900, Houston, Texas 77027.
Whether or not you plan to attend, and regardless of the number of
shares or ADRs you own, it is important that your shares be represented at the
meeting. You are accordingly urged to sign, date and return your proxy promptly.
ADR holders should return the proxy to the depositary, Morgan Guaranty Trust
Company of New York ("Morgan"), by 3:00 p.m. on Tuesday, November 12, 1996 in
the envelope provided by Morgan, which requires no postage if mailed in the
United States. U.S. holders of ordinary shares must return the proxy so that it
is received at the Company's executive offices in Houston by Monday, November
11, 1996; the Company has made arrangements to send the materials via courier to
its U.K. offices. Non-U.S. holders of ordinary shares should return the proxy to
the Company's U.K. offices by Wednesday, November 13, 1996. Your return of a
proxy in advance will not affect your right to vote in person at the meeting.
We hope that you will be able to attend the meeting. The officers and
directors of Learmonth & Burchett Management Systems Plc look forward to seeing
you at that time.
Sincerely,
GERALD N. CHRISTOPHER
Chairman of the Board
of Directors
MICHAEL S. BENNETT
Director and
Chief Executive Officer
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<PAGE>
LEARMONTH & BURCHETT
MANAGEMENT SYSTEMS PLC
1800 West Loop South
Suite 900
Houston, Texas 77027
---------------------
NOTICE OF ANNUAL GENERAL MEETING
To be held November 15, 1996
---------------------
The Annual General Meeting of Learmonth & Burchett Management Systems
Plc (the "Company") will be held at the Company's executive offices located at
1800 West Loop South, Suite 900, Houston, Texas, on Friday, November 15, 1996 at
11:00 a.m. CST for the following purposes:
As ORDINARY BUSINESS:
1. To receive and adopt the Directors' Report and the audited
accounts for the year ended April 30, 1996.
2. To re-elect Gerald N. Christopher who was appointed as a
Director on August 2, 1996.
3. To re-elect Michael S. Bennett who was appointed as a Director
on August 2, 1996.
4. To re-elect David B. Rodway who retires as a Director by
rotation.
5. To re-elect Rainer H. Burchett who retires as a Director by
rotation.
6. To re-appoint the auditors Price Waterhouse to hold office
until the next Annual General Meeting and to authorize the
Directors to fix their remuneration.
As SPECIAL BUSINESS, to consider, and if thought fit to pass, the
following resolutions, of which Resolutions 7, 8, 9, 10, and 11 will be proposed
as Ordinary Resolutions and Resolution 12 will be proposed as a Special
Resolution:
7. To approve the adoption of the 1996 Equity Incentive Plan.
8. To approve the adoption of the 1996 U.S. Employee Stock
Purchase Plan.
9. To approve the adoption of the 1996 Non-employee Directors'
Share Option Plan.
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<PAGE>
10. To approve an amendment to the Executive Share Option Scheme
and to Type B option certificates granted thereunder
regarding new vesting arrangements.
11. To authorize the Directors to allot shares.
12. To approve disapplication of preemptive rights of holders of
ordinary shares.
IF YOU ARE UNABLE TO BE PRESENT PERSONALLY, PLEASE SIGN AND DATE THE ENCLOSED
PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
A shareholder who is entitled to be present and vote at the Annual
General Meeting may appoint a proxy to attend and vote in his/her stead. Any
proxy so appointed would not be a member. To be effective, forms of proxy must
be deposited at the Company's registered office by 11:00 a.m. on Wednesday,
November 13, 1996, not less than 48 hours before the appointed time of the
meeting. The registered office of Learmonth & Burchett Management Systems PLC is
located at Evelyn House, 62 Oxford Street, London W1N 9LF England. For
convenience of U.S. holders of ordinary shares (not ADRs), the Company will send
to its registered office all proxies received at its Houston headquarters by
5:00 p.m. Houston time on Monday, November 11, 1996. ADR holders should return
the proxy to the depositary, Morgan Guaranty Trust Company of New York
("Morgan"), by 3:00 p.m. on Tuesday, November 12, 1996 in the envelope provided
by Morgan, which requires no postage if mailed in the United States. Completion
of the proxy card does not preclude the member from attending and voting at the
meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
Stephen E. Odom
Company Secretary
October 14, 1996
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<PAGE>
LEARMONTH & BURCHETT
MANAGEMENT SYSTEMS PLC
1800 West Loop South
Suite 900
Houston, Texas 77027
---------------------
PROXY STATEMENT
ANNUAL GENERAL MEETING
---------------------
The accompanying proxy is solicited by and on behalf of the Board of
Directors of Learmonth & Burchett Management Systems Plc (the "Company") for use
at the Annual General Meeting ("AGM") to be held at the Company's executive
offices located at 1800 West Loop South, Suite 900, Houston, Texas 77027 on
Friday, November 15, 1996 at 11:00 a.m. CST and any adjournments thereof.
Holders of ordinary shares of 10 pence each in the capital of the
Company ("Ordinary Shares") on the Register of Members at the date of the AGM
will be entitled to vote at the AGM. On October [ ], 1996 (being the latest
practicable date prior to the printing of this document), there were __________
Ordinary Shares in issue, the holders of which are entitled on a poll to one
vote per share on each matter to come before the meeting. Proxies properly
executed and returned will be voted at the meeting in accordance with any
directions noted thereon or, if no direction is indicated, proxies will be voted
FOR receiving and adopting the Report and Accounts, FOR election of each of the
directors, FOR appointment of the auditors, FOR adoption of 1996 Equity
Incentive Plan (the "Equity Incentive Plan"), FOR adoption of 1996 U.S. Employee
Stock Purchase Plan, FOR adoption of 1996 Non-employee Directors' Share Option
Plan, FOR approval of amendment to Executive Share Option Scheme and to Type B
option certificates granted thereunder regarding new vesting arrangements, FOR
authorizing the Directors to allot shares and FOR Disapplication of preemptive
rights. Proxies will be voted in the discretion of the holders of the proxy with
respect to any other business that may properly come before the meeting and all
matters incidental to the conduct of the meeting. Any shareholder signing and
delivering a proxy may revoke it at any time before it is voted by delivering to
the Company Secretary a written revocation or a duly executed proxy bearing a
later date than the date of the proxy being revoked. Any shareholder attending
the meeting in person may revoke his or her proxy and vote his or her shares at
the meeting. In accordance with the terms of the Company's American Depositary
Receipts, holders of ADRs may instruct the Depositary, Morgan Guaranty Trust
Company of New York, how the shares underlying their ADRs should be voted.
This Proxy Statement was mailed to shareholders on or about October 14,
1996.
-1-
<PAGE>
PROPOSAL NUMBER 1
RECEIVING AND ADOPTING REPORT AND ACCOUNTS
THE BOARD OF DIRECTORS RECOMMENDS
RECEIVING AND ADOPTING REPORT AND ACCOUNTS
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<PAGE>
PROPOSALS TO BE CONSIDERED AT ANNUAL GENERAL MEETING
PROPOSAL NUMBERS 2 THROUGH 5
ELECTION OF DIRECTORS
Four directors are to be proposed for election at the 1996 AGM. Unless
instructions are given to the contrary, it is the intention of the persons named
as proxies to vote the shares to which each proxy relates FOR the election of
each of the nominees listed below. All of the nominees named below are presently
serving as directors of the Company and are anticipated to be available for
election and able to serve. Two of the nominees were elected to the Board at the
meeting of the Board of Directors in Houston, Texas on August 2, 1996; and all
to be re-elected by the Shareholders.
Set forth below is certain information concerning the nominees and
incumbent directors:
- --------------------------------------------------------------------------------
Nominees for Election at the 1996 Annual General Meeting
- --------------------------------------------------------------------------------
Gerald N. Christopher - Mr. Christopher has served as Chairman and
Director of Learmonth & Burchett Management Systems Plc since August 2, 1996. He
previously held the positions of President and Chief Executive Officer of Amber
Wave Systems, Inc., Extension Technology and Channel Computing. Additionally, he
was the Chief Financial Officer of Bachman Information Systems, Inc.
Michael S. Bennett - Mr. Bennett has served as the President, Chief
Executive Officer and Director since August 2, 1996. Mr. Bennett served as the
President and Chief Executive Officer of Summagraphics until the time of its
acquisition by Lockheed Martin's CalComp subsidiary. Prior to Summagraphics, Mr.
Bennett served as Senior Executive with Dell Computer and Chief Executive
Officer of several high technology organizations. He also has spent over 12
years in various capacities with Digital Equipment Corporation in both domestic
and international positions.
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<PAGE>
- --------------------------------------------------------------------------------
Directors Whose Terms Expire in 1996 and
Nominees for Election at the 1996 Annual General Meeting
- --------------------------------------------------------------------------------
David B. Rodway - Mr. Rodway has served as Senior Vice
President-Development of the Company since 1994 and as a Director since 1991.
Mr. Rodway joined the Company in 1990 as Associate Director. Prior to joining
the Company, Mr. Rodway served as Research and Development Director of Hugin
Sweda International, a supplier of retail information systems, and prior to that
was Director of Software Sciences, a systems contractor and subsidiary of Thorn
EMI, a U.K.-based conglomerate, responsible for research and development.
Rainer H. Burchett - Mr. Burchett has served as a Director of the
Company since 1977 and as its Chairman until his resignation as such on August
2, 1996. Mr. Burchett co-founded the Company in 1977. Prior to founding the
Company, he was employed by BIS Applied Systems, a consulting company.
- --------------------------------------------------------------------------------
Incumbent Directors
- --------------------------------------------------------------------------------
G. Felda Hardymon - Mr. Hardymon has served as a Director since 1994.
Mr. Hardymon has served as a General Partner of Bessemer Venture Partners, a
group of venture capital funds, since 1981. Prior to joining Bessemer, Mr.
Hardymon was Vice President of Business Development Services, Inc., the venture
capital subsidiary of General Electric Company. He serves on the board of Video
Server, Inc., a supplier of networking equipment and associated software for
multimedia conferences.
Roger A. Learmonth - Mr. Learmonth has served as a Director since
co-founding the Company in 1977. Mr. Learmonth served as the Company's Chief
Executive Officer until October 1994. Prior to founding the Company, Mr.
Learmonth was employed by BIS Applied Systems.
Information Concerning the Board and Its Committees
The Board of Directors held [______ meetings] in the fiscal year ended
April 30, 1996. The Board has two standing committees: the Audit Committee and
the Remuneration Committee.
The members of the Audit Committee in the fiscal year ended April 30,
1996 were Messrs. O'Hara (Chairman), Burchett and Tebbs and for the fiscal year
ended April 30, 1997 are Messrs.
-4-
<PAGE>
Hardymon and Christopher.1 The Audit Committee meets from time to time and the
independent accountants of the Company may, at any time they consider
appropriate, request a meeting. The responsibilities of the Audit Committee are
to consider and recommend the appointment of the Company's independent
accountants, approve the audit fee, consider any questions of resignation or
dismissal of the auditors, discuss with the independent accountants the nature
and scope of the audit, review the quarterly, half-year and annual financial
statements before submission to the Board, discuss problems and reservations
arising from the quarterly and interim unaudited accounts and annual audits and
any other matters the independent accountants may wish to discuss, review the
independent accountants' management letter and management's response, review the
Company's statement on internal control systems and consider the major findings
of internal investigations and management's response.
The members of the Remuneration Committee in the fiscal year ended
April 30, 1996 were Messrs. Tebbs (Chairman), Burchett, Hardymon and O'Hara. On
August 2, 1996, the Board of Directors of the Company voted to reconstitute the
Remuneration Committee with Board members Messrs. Christopher, Hardymon and
Burchett. The Remuneration Committee meets from time to time to approve and
recommend to the Board the remuneration of the Executive Directors (Messrs.
Burchett, Bantleman (1996), Rodway and Bennett (1997)) and key personnel. In
particular, the Remuneration Committee is required to approve any new service
agreement entered into between the Company and any of the Executive Directors.
During fiscal 1996, both committees met without the presence of Mr. Burchett
from time to time, for example, when determining Mr. Burchett's own
remuneration; the occasional absence of Mr. Burchett from such meetings can be
expected in this fiscal year. The Remuneration Committee also sets and approves
share allocations under the Company's Executive Share Option Scheme.
In fiscal 1996, each of the Directors who was not an Executive Director
was entitled to compensation from the Company for serving on the Board of
Directors equal to an annual fee of (pound)13,000, plus an additional
(pound)1,275 per meeting for meetings of the Board of Directors which were
outside a Director's home country. Additionally, the Company reimburses each of
these Directors for expenses incurred in attending meetings of the Board of
Directors.
From time to time the Company engages non-Executive Directors to
perform consulting services for the Company on a limited basis. As compensation
for the performance of such services (which are generally outside of the scope
of their duties as a director), such nonExecutive Directors receive a consulting
fee equal to [(pound)850] per day. [During fiscal 1996, Mr.
Tebbs received [(pound)_____] in consulting fees from the Company.]
Copies of the service contracts between each of the Directors and the
Company or any of its subsidiaries and the register of Director's interests in
shares will be available for inspection
- --------
1 Messrs. O'Hara and Tebbs resigned as Directors in January and July,
1996, respectively.
-5-
<PAGE>
during normal business hours at the registered office from October 14 to
November 11, 1996 when they will be available at the place of the AGM from 15
minutes prior to its commencement until its close.
THE BOARD OF DIRECTORS RECOMMENDS
ELECTION OF THE NOMINEES
DESCRIBED ABOVE
-6-
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table and notes thereto set forth certain information
with respect to the beneficial ownership of the Ordinary Shares as of October
10, 1996 by (i) each person who is known to the Company to beneficially own more
than 5% of the outstanding Ordinary Shares of the Company; (ii) each Named
Executive Officer and each director of the Company; (iii) each current executive
officer and (iv) all officers and directors of the Company as a group. Except as
otherwise indicated, each of the shareholders named below has sole voting and
investment power with respect to the Ordinary Shares beneficially owned:
[COMPLETE DATA AS OF 10/10/96]
Ordinary Shares
Beneficially Owned(1)
Officers, Directors and 5% Shareholders Number Percent
Rainer H. Burchett............................. 1,500,000(2) [__]%
c/o Learmonth & Burchett..................
Management Systems Plc
Evelyn House
62 Oxford Street
London W1N 9LF England
Roger A. Learmonth............................. 1,049,749(3) [__]%
c/o Learmonth & Burchett
Management Systems Plc
Evelyn House
62 Oxford Street
London W1N 9LF England
Bessemer Venture Partners III L.P. 2,035,801(4) [__]%
83 Walnut Street
Wellesley Hills, MA 02181
The Kaufman Fund............................... 2,030,000 [__]%
140 E. 45th Street
New York, NY 10017
S Squared Technology Corp...................... 1,253,276(5) [__]%
515 Madison Avenue
Suite 4200
New York, NY 10022
LBMS Trustee Company Ltd....................... 1,024,241(6) [__]%
c/o Learmonth & Burchett
Management Systems Plc
Evelyn House
62 Oxford Street
London W1N 9LF England
Gerald N. Christopher.......................... 2,000 *
Michael S. Bennett............................. 0 *
Stephen E. Odom................................ ---- *
Peter Combe................................... 16,500(7) *
David B. Rodway................................ 44,500(8) *
Rick Pleczko................................... 24,400(9) *
Felda Hardymon................................. 65,262(10) *
-7-
<PAGE>
All current directors and executive officers
as a group (14)........................ 2,642,511 [__]%
- ----------------
* Less than one percent.
(1) Applicable percentage of ownership as of October 10, 1996 is based upon
_________ Ordinary Shares outstanding. Gives effect to the Ordinary
Shares issuable within 60 days of October 10, 1996 upon the exercise of
options beneficially owned by the indicated shareholder on that date.
Unless otherwise indicated, the persons named in the table have sole
voting power and sole investment control with respect to all Ordinary
Shares beneficially owned. Beneficial ownership is determined in
accordance with the rules of the Securities and Exchange Commission and
includes voting and investment power with respect to such Ordinary
Shares.
(2) Includes 409,758 Ordinary Shares held by 11 trusts for which Mr.
Burchett is a co-trustee. Also includes 402,242 Ordinary Shares held
in four other trusts, of which Mr. Burchett is the beneficiary but over
which Mr. Burchett does not have voting control or the power of
disposition. Also includes 50,000 Ordinary Shares held by his wife, as
to which Mr. Burchett disclaims beneficial ownership. Does not include
1,024,241 Ordinary Shares owned of record by LBMS Trustee Company
Limited of which Mr. Burchett is a shareholder and a director. Mr.
Burchett disclaims beneficial ownership in all shares held by LBMS
Trustee Company Limited.
(3) Includes 600,000 Ordinary Shares held in a trust for which Mr.
Learmonth serves as co-trustee and 266,225 Ordinary Shares held in two
trusts, of which Mr. Learmonth is the beneficiary but over which Mr.
Learmonth does not have voting control or the power of disposition.
Also includes 180,674 and 2,850 Ordinary Shares held by his wife and
daughter, respectively. With respect to the Ordinary Shares held by
Mrs. Learmonth, Mr. Learmonth disclaims beneficial ownership. Does not
include 1,024,241 Ordinary Shares owned of record by LBMS Trustee
Company Limited of which Mr. Learmonth is a director. Mr. Learmonth
disclaims beneficial ownership in all shares held by LBMS Trustee
Company Limited.
(4) Includes 38,903 Ordinary Shares owned by BVP III Special Situations
L.P. and 92,643 owned beneficially by certain present or former
officers of Bessemer Securities Corporation, the sole owner of the sole
limited partner of Bessemer Venture Partners III L.P. Under certain
circumstances Bessemer Venture Partners III L.P. may direct the voting
of such shares.
(5) These shares are all held in discretionary accounts for clients of S
Squared Technology Corp. No single client owns more than 5% of the
Company's shares.
(6) Ordinary Shares held by the Executive Share Option Trust are controlled
by the Trustee, LBMS Trustee Company Limited, of which Mr. Burchett is
a shareholder and director and Mr. Learmonth is a director. Messrs.
Burchett and Learmonth each disclaim beneficial ownership of all
Ordinary Shares held by the Trust. Options representing 733,700
Ordinary Shares have been designated to be satisfied by Ordinary Shares
held by the Trust.
(7) Includes 12,500 Ordinary Shares issuable upon exercise of a share
option.
(8) Includes 37,000 Ordinary Shares issuable upon exercise of a share
option.
(9) Includes 11,300 Ordinary Shares issuable upon exercise of a share
option.
(10) Excludes 1,996,898 Ordinary Shares owned by Bessemer Venture Partners
III LP. Mr. Hardymon is a general partner of the general partner of
Bessemer Venture Partners III LP.
-8-
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by
or paid for services rendered to the Company in all capacities during fiscal
1996 and fiscal 1995 by (i) the Company's Chief Executive Officer and (ii) each
of the four most highly paid executive officers who received compensation in
excess of $100,000 for the fiscal year 1996 (together, the "Named Executive
Officers").
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Compensation
Awards of
Securities
Annual Compensation Underlying All Other
Name and Principal Position Year (7) Salary($) Bonus($) Options Compensation (4)
- --------------------------- -------- --------- -------- ------------ ----------------
<S> <C>
John P. Bantleman (1) 1996 $189,272 $ 55,000 100,000 $ 1,133
Chief Executive Officer 1995 $151,073 $100,000 564,000 $ 2,719
Stephen Odom (2) 1996 $150,000 $ 50,000 100,000 $ 0
Chief Financial Officer 1995 N/A N/A 200,000 N/A
and Secretary
Peter Combe 1996 $153,412 $ 73,770 100,000 $ 1,547
Senior Vice President 1995 $121,183 $104,423 199,000 $ 1,414
Rainer H. Burchett 1996 $134,463 $ 0 0 $66,330 (5)
Chairman (3) 1995 $134,560 $ 0 0 $62,595 (6)
Rick Pleczko 1996 $137,100 $ 77,540 100,000 $ 2,070
Vice President 1995 $107,831 $ 59,873 143,000 $ 1,863
</TABLE>
(1) John P. Bantleman resigned as President and Chief Executive Officer and
as a Director of the Company in August, 1996.
(2) Stephen E. Odom joined the Company in April 1995, just prior to the
fiscal year end. For fiscal 1995 Mr. Odom's annual salary would have
been $150,000 and Mr. Odom would have been entitled to bonus
compensation of up to $50,000. In addition Mr. Odom was granted an
option to purchase 200,000 Ordinary Shares.
(3) Rainer H. Burchett resigned as Chairman of the Board of Directors in
August, 1996.
(4) Represents Company contributions to the Company's 401(k) Plan, a
defined contribution plan available to U.S. employees only. Except with
respect to Mr. Burchett, other compensation in the form of perquisites
and other personal benefits has been omitted as the aggregate amount of
such perquisites and other personal benefits constituted the lesser of
$50,000 or 10% of the total annual salary and bonus of the Named
Executive Officer for such year.
-9-
<PAGE>
(5) Includes $38,750 to The Equitable Life Assurance Company Limited,
$5,167 to M&G Pension and Annuity Company Limited and $22,413 in car
allowance.
(6) Represents Company contributions of $39,250 and $5,233 to The Equitable
Life Assurance Company Limited and M&G Pension and Annuity Company
Limited, respectively, for money purchase retirement plans maintained
for Mr. Burchett. Also includes $18,122 received by Mr. Burchett for
car allowance.
(7) The periods covered by this table are the fiscal years ended in April
1996 and 1995.
Share Option Information
The following table sets forth certain information regarding the option
grants made pursuant to the Company's Executive Share Option Scheme and ESOP
Share Option Scheme (the "Share Option Plans") during fiscal 1996 to each of the
Named Executive Officers.
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
Potential Realizable
Number of Value at Assumed
Ordinary Shares Percentage Exercise Annual Rates of
Underlying of Total Price Stock Price
Options Options in Pounds Expiration Appreciation for
Name Granted Granted (4) Sterling (5) Date Option Term (6)
- ---- ------- ----------- -------------- ------------ ---------------
5% 10%
-------------------------
<S> <C>
John P. Bantleman (1) 100,000 12% 3.23 3/29/06 $331,463 $527,800
Stephen Odom (2) 100,000 12% 1.33 3/29/06 $331,463 $527,800
Peter Combe 100,000 12% 1.33 3/29/06 $331,463 $527,800
Rainer H. Burchett (3) N/A 0% N/A N/A N/A N/A
Rick Pleczko 50,000 6% 1.33 3/29/06 $165,731 $263,900
</TABLE>
- ------------------
(1) John P. Bantleman resigned as President and Chief Executive Officer and
as a Director of the Company in August, 1996. Upon Mr. Bantleman's
resignation, 520,500 unvested options previously granted to him expired
as of such date. 209,750 vested stock options will remain exercisable
until May 31, 1997 but shall be held as collateral against past
advances from Learmonth & Burchett Management Systems, Inc. to Mr.
Bantleman.
(2) Stephen E. Odom joined the Company in April 1995, just prior to the
fiscal year end. For fiscal 1995 Mr. Odom's annual salary would have
been $150,000 and Mr. Odom would have been entitled to bonus
compensation of up to $50,000. In addition Mr. Odom was granted an
option to purchase 200,000 Ordinary Shares.
(3) Rainer H. Burchett resigned as Chairman of the Board of Directors in
August, 1996.
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<PAGE>
(4) Based on an aggregate of 814,000 options granted to employees in fiscal
1996, including options granted to the Named Executive Officers.
(5) The market value at the date of grant was(pound)1.33 per Ordinary
Share. The exchange rate at the date of grant was $1.53/(pound).
(6) Amounts represent hypothetical gains that could be achieved for the
respective options at the end of the ten-year option term. The assumed
5% and 10% rates of share appreciation are mandated by rules of the
Securities and Exchange Commission and do not represent the Company's
estimate of the future market price of the Ordinary Shares.
OPTION EXERCISES AND YEAR-END INTERESTS
The following table sets forth for each of the Named Executive Officers
certain information concerning the value of unexercised options at the end of
fiscal 1996 (including options granted in fiscal 1996) and the value of options
exercised in fiscal 1996.
Aggregate Option Exercises in Last Fiscal year
and Fiscal year-End Option Values
<TABLE>
<CAPTION>
[Ordinary Shares] Number of Net Values of Unexercised
Acquired Value Unexercised Options In-the-Money Options (4)
on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
<S> <C>
John P. Bantleman (1) N/A N/A 42,000 688,250 $91,915 $694,945
Stephen Odom (2) N/A N/A N/A 300,000 N/A 229,500
Peter Combe 4,000 $18,085 6,000 310,500 11,819 369,227
Rainer H. Burchett (3) N/A N/A N/A N/A N/A N/A
Rick Pleczko 12,000 37,668 5,600 202,900 11,567 253,467
- ----------------
</TABLE>
(1) John P. Bantleman resigned as President and Chief Executive Officer and
as a Director of the Company in August, 1996. Upon Mr. Bantleman's
resignation, 520,500 unvested options previously granted to him expired
as of such date. 209,750 vested stock options will remain exercisable
until May 31, 1997 but shall be held as collateral against past
advances from Learmonth & Burchett Management Systems, Inc. to Mr.
Bantleman.
(2) Stephen E. Odom joined the Company in April 1995, just prior to the
fiscal year end. For fiscal 1995 Mr. Odom's annual salary would have
been $150,000 and Mr. Odom would have been entitled to bonus
compensation of up to $50,000. In addition Mr. Odom was granted an
option to purchase 200,000 Ordinary Shares.
(3) Rainer H. Burchett resigned as Chairman of the Board of Directors in
August, 1996.
-11-
<PAGE>
(4) Based on the estimated fair value of the Company's Ordinary Shares at
the end of fiscal 1996 (as determined by the price per Ordinary Share
of (pound)1.93 on the USM at April 30, 1996), less the exercise price
payable for such Ordinary Shares. The exchange rate at April 30, 1996
was $1.53/(pound).
Compliance with Section 16(a) of the Exchange Act
[_________], a [__________] of the Company, filed late the Form 4
required to be filed pursuant to Section 16(a) of the Securities Exchange Act of
1934, as amended, with respect to [_____] transaction(s) during the fiscal year
ended April 30, 1996 that was reportable on such form. [__________], who
resigned as a Director (and officer) of the Company in [________], 1996,
reported late, on his Form 5 for the fiscal year ended April 30, 1996, [_____]
transaction(s) during such fiscal year that were reportable on a Form 4.
Employment Arrangements With Executive Officers
Michael S. Bennett and the Company are parties to an agreement pursuant
to which Mr. Bennett serves as President and Chief Executive Officer of the
Company and a member of the Company's Board of Directors. The agreement has an
effective date of August 2, 1996 with no initial fixed term and no termination
notification requirement as Mr. Bennett is an employee at will. The initial
salary payable under the agreement is $200,000 per year. Pursuant to the
agreement, the initial salary may be adjusted by the Board of Directors at an
annual review. The Company has also issued to Mr. Bennett options to purchase
400,000 Ordinary Shares at an exercise price of $1.185. Mr. Bennett is also
entitled to a bonus of $100,000 at target performance and to participate in
certain of the Company's benefit plans. In the event of a change of control of
the Company, Mr. Bennett will be entitled to a severance payment of $300,000 and
all of his then unvested share options will become immediately vested.
Gerald N. Christopher and the Company are parties to an agreement
pursuant to which Mr. Christopher serves as Chairman of the Board of Directors
of the Company. The agreement has an effective date of August 2, 1996 with no
initial fixed term and no termination notification requirement as Mr.
Christopher is an employee at will. The initial salary payable under the
agreement is $3,000 per week, subject to adjustment effective January 1, 1997,
when Mr. Christopher's yearly salary is set at a rate of $1,000 per week. The
Company has also issued to Mr. Christopher options to purchase 250,000 Ordinary
Shares at an exercise price of $1.185. Mr. Christopher is also entitled to
reimbursement for the cost of an apartment and reasonable living expenses in the
Houston area, as well as for reasonable travel expenses.
[John P. Bantleman resigned as President and Chief Executive Officer
and as a Director of the Company on August 2, 1996. Under the terms of a
termination agreement with the Company, Mr. Bantleman received a lump sum of
$106,000 (less payroll deductions and taxation withholding), representing six
months salary continuation and an automobile allowance. Health benefits were
continued for six months, as well. Upon Mr. Bantleman's resignation, the Board
voted to accelerate 150,000 of his unvested options resulting in his holding
209,750 vested stock options exercisable through May 31, 1997. Such options are
held
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as collateral against Mr. Bantleman's advances of $90,000 from the Company. The
balance of his unvested options expired upon his resignation.]
CERTAIN TRANSACTIONS
In August 1995, as part of the acquisition of Corporate Computing, Inc.
by the Company, the Company issued an aggregate of 700,000 Ordinary Shares, of
which 315,000 Ordinary Shares were issued to Christine Comaford, the principal
shareholder of CCI, and the balance were issued to other equity interest holders
of CCI. At that time, the Ordinary Shares issued to Ms. Comaford had a market
value on the USM of (pound)945,000.
On August 2, 1996, at a meeting of the Board of Directors of the
Company, it was unanimously voted that, subject to the approval of the 1996
Equity Incentive Plan, Messrs. Christopher and Bennett were granted options to
purchase 250,000 and 400,000 Ordinary Shares, respectively, equivalent to
125,000 and 200,000 American Depositary Shares, respectively. The aggregate
purchase prices are $296,250 and $474,000, respectively. On September 26, 1996
Messrs. Odom, Combe, Rodway and Pleczko were each granted options to purchase
150,000 Ordinary Shares, equivalent to 75,000 American Depositary Shares for an
aggregate purchase price of $177,750.
Remuneration Committee Report
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the following
report and the Performance Graph on page 8 shall not be incorporated by
reference into any such filings.
REPORT OF THE LEARMONTH & BURCHETT MANAGEMENT
SYSTEMS PLC BOARD OF DIRECTORS
REMUNERATION COMMITTEE
The Company's executive compensation program is administered by the
Remuneration Committee of the Board of Directors (the "Committee"). The
Committee, which is composed of three independent directors, makes
recommendations to the Board of Directors on the three key components of the
executive compensation program: base salary, annual incentive awards and
long-term incentives.
The Committee establishes individual compensation awards based on the
contribution the executive has made in attaining the Company's short term and
strategic performance objectives as well as the executive's anticipated future
contribution. The Company's executive compensation program consists primarily of
the following integrated components:
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1. Base Salary - which is designed to compensate executives
competitively within the industry and marketplace.
2. Annual Incentives - which provide a direct link between executive
compensation and annual Company performance against predetermined measures.
3. Long-Term Incentives - which consist of stock options designed to
link management decision making with long-term Company performance and
shareholder interests.
Base Salary. Base salary levels for executive officers of the Company
are reviewed annually by the Remuneration Committee. Executive officers of the
Company are paid salaries in line with their responsibilities.
Annual Incentives. All executive officers are eligible to receive
incentive cash bonuses. Awards are based on the attainment of performance
measures established by the Remuneration Committee at the beginning of the
fiscal year. These performance measures are keyed to management's annual
operating plan and are based on the achievement of targeted operating profit and
revenue growth. As Company performance for fiscal 1996 did not meet the targeted
measures, the incentive cash bonuses actually paid were below targeted amounts.
Long-Term Incentives. The Company provides long-term incentives through
its two share option plans (the "Share Option Plans"). Under the Executive Share
Option Scheme, options may be granted within each period of six weeks following
the date on which the Company announces its annual, half-yearly or quarterly
results. Under the ESOP Share Option Scheme, options may be granted within the
six weeks following the announcement by the Company of its annual or half-yearly
results, or otherwise in exceptional circumstances. Share options are intended
to offer an equity incentive for superior performance and to foster the
retention of key personnel through awards structured to vest and become
exercisable over time provided that the individual remains employed by the
Company. There is no set formula for the award of options. Factors considered in
making option awards to officers and employees of the Company include industry
practices and norms, prior grants to such officers or employees, the importance
of retaining such officer's or employee's services, such officer's or employee's
potential to contribute to the success of the Company and such officer's or
employee's past contributions to the Company. Because the receipt of value by an
executive officer under the Share Option Plans is dependent upon an increase in
the price of the Company's Ordinary Shares, this portion of the executives'
compensation is directly aligned with an increase in shareholder value.
The Board of Directors approves the compensation of the Chief Executive
Officer. The Chief Executive Officer and the Company are parties to a Service
Agreement pursuant to which Michael S. Bennett serves as Chief Executive Officer
of the Company. The salary payable under the agreement may be adjusted by the
Board of Directors at any time. The Committee believes Mr. Bennett is paid a
reasonable salary. Mr. Bennett is also entitled to bonuses as determined by the
Board of Directors of the Company and to participate in the Company's
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benefit plans. The bonuses payable and option grants are determined generally
using the same measurements employed in determining such awards for other
executive officers described above.
Remuneration Committee
Rainer Burchett
Gerald Christopher
Felda Hardymon
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PERFORMANCE GRAPH
Comparison of cumulative total return among Learmonth & Burchett Management
Systems PLC,
<TABLE>
<CAPTION>
Base
Period
Company/Index 16-Nov-95 Nov-95 Dec-95 Jan-96 Feb-96 Mar-96 Apr-96
<S> <C>
LEARMONTH & BURCHETT MANAGEMENT SYS. 100 102.63 93.42 103.95 48.68 40.79 61.84
S&P MIDCAP COMPUTER (SOFTWARE & SVC.) 100 106.29 103.86 94.24 100.28 98.34 108.59
S&P MIDCAP 400 INDEX 100 101.73 101.47 102.94 106.44 107.72 111.01
</TABLE>
S&P Midcap 400 Index and S&P Midcap Computer Software and Services Index*
Figure 1
- -------
* Assumes $100 invested in the Company's American Depositary Shares, S&P
Midcap 400 Index and S&P Midcap Computer Software & Services Index on
November 16, 1995, the date of the Company's initial public offering in
the United States. Assumes reinvestment of dividends.
The stock prices on the foregoing Performance Graph are not necessarily
indicative of future stock price performance. Each of the Report of the
Remuneration Committee of the Board of Directors set forth above under "Report
of the Remuneration Committee" and the Performance Graph shall not be deemed
incorporated by reference by any general statement incorporating this Proxy
Statement into any filing under the Securities Act of 1933, as amended, or under
the Exchange Act, except to the extent that the Company specifically
incorporates such information by reference, and shall not otherwise be deemed
filed under such Acts.
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<PAGE>
OTHER INFORMATION
Share Option Plans
The Company has established two share option plans (the "Share Option
Plans") for its employees. In connection with the Share Option Plans, the
Company established the Executive Share Option Trust in 1984, to hold trust
assets for the benefit of employees and former employees of the Company and its
subsidiaries (the "Group Companies"). The present Trustee of the Trust is LBMS
Trustee Company Limited (the "ESOP Trustee"), a subsidiary of the Company, whose
board of directors currently consists of Messrs. Learmonth and Burchett. The
ESOP Trustee has the power to borrow money and enter into other financing
arrangements for the purpose of acquiring any holding of Ordinary Shares on
behalf of the beneficiaries, and in particular to make any such Ordinary Shares
available to satisfy options exercised under the Share Option Plans. The
borrowings of the Trust and the expenses and liabilities of the ESOP Trustee are
guaranteed or indemnified by the Company.
A summary of the terms of the Share Option Plans is set out below:
Executive Share Option Scheme. The Executive Share Option Scheme (the
"Executive Plan") was originally adopted by the Company in 1984 and has been
amended on a number of occasions. Options are outstanding both under the terms
currently in force and under the terms of previous versions of the Executive
Plan. Under the terms of the Executive Plan, options may be granted to any
employee of the Company and its subsidiaries (each, a "Group Company") who works
full time (at least 25 hours per week in the case of directors, and at least 20
hours per week in the case of employees) and who does not have a material
interest in the Company. Options may be granted at the discretion of the
Directors or by a committee approved by the Directors (the "Committee"). Under
the Executive Plan, options granted are only exercisable when certain conditions
- -- in part related to the performance of the Company -- have been met. The
exercise price for an option is determined by the Committee at the date of
grant, but may not be less than the market value of an Ordinary Share at the
date of grant. Options may be granted within period of six weeks following the
date on which the Company announces its annual, half-yearly or quarterly
results.
The Executive Plan contains a number of limits on the grant of options.
In particular, as at any date, the aggregate number of Ordinary Shares which may
be issued pursuant to options granted in the ten years ending on that date under
the Executive Plan and any other employees' share plan of the Company may not
exceed 10% of the then issued Ordinary Share capital. If options are to be
granted in any ten year period over more than 5% of the then issued Ordinary
Share capital, then the options must be subject to more stringent performance
conditions. Subject to certain adjustments under the Executive Plan, the
aggregate number of Ordinary Shares over which options may be granted under the
Executive Plan, from and including April 12, 1995, shall not exceed 5,000,000.
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The Executive Plan is divided into two parts, one part of which has
been approved by the U.K. Inland Revenue and one part of which has not. The
effect of such approval is that options granted to U.K. employees under the
approved portion of the Executive Plan ("Approved Options") attract more
favorable tax treatment for the employee under U.K. tax laws.
The rules for the unapproved section of the Executive Plan are
substantially the same as those for the approved section, except that:
(a) options granted under the unapproved section are not
subject to the U.K. Inland Revenue requirement that an individual's
entitlement to options should be limited originally to the greater of
(i) (pound)100,000 and (ii) four times annual U.K. taxable remuneration
and, since July 1995, following a change of law, to (pound)30,000;
(b) options granted under the unapproved section are not
automatically exercisable on a reorganization or change of control of
the Company in circumstances where a replacement option is available.
Proposal Number 11 would change this by amending the Executive Plan to
make these options immediately exercisable in full upon a change in
control.
An option may not be exercised more than 10 years after the date of
grant and an option may only be exercised by the person to whom it is granted or
his personal representative and is not transferable.
Options may be satisfied on exercise either by the allotment and issue
of new Ordinary Shares, or by the transfer of existing fully paid Ordinary
Shares. Ordinary Shares allotted and issued under the Executive Plan rank pari
passu in all respects with Ordinary Shares then in issue, but do not participate
in any dividend or other rights attaching to Ordinary Shares by reference to a
record date preceding the date of exercise of the option. Application will be
made for any Ordinary Share so issued to be admitted to listing or quotation on
any stock exchange or securities market on which the Ordinary Shares are then
listed or quoted.
Except for options to acquire an aggregate of 1,175,000 Ordinary Shares
issued on September 1, 1994 which are exercisable in full after three years,
options granted prior to April, 1995 become vested and exercisable over a
specified period of years from the date of grant, fixed as at the time of grant.
Such options are generally exercisable as to 60% after three years from the date
of grant, and as to an additional 20% after the end of such succeeding year that
has elapsed. Subject to approval of Proposal Number 11, Options granted in
[April,] 1995 [onwards] become vested in full in accordance with the following
formula: as to 40%, after two years from the date of grant, and as to a further
5% after the end of each succeeding quarter.
All options may also be exercised in full for a limited period after a
takeover, reconstruction or amalgamation (a reorganization), or voluntary
winding up of the Company, except where the option holder elects to accept a
replacement option offered by the acquiring company.
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In the event of any capitalization or rights issue, or subdivision,
consolidation or reduction of capital, the Directors may make such adjustments
as they consider appropriate to the number and/or the exercise price of any
outstanding options. Any such adjustment will require prior approval of the U.K.
Inland Revenue insofar as it affects any Approved Option. Except in limited
circumstances, the Executive Plan may not be amended without the prior approval
of shareholders in general meeting and, as regards the approved section, the
U.K. Inland Revenue.
As of October 10, 1996, options for the purchase of a total of
1,320,550 Ordinary Shares were outstanding under the Executive Plan, at exercise
prices ranging from (pound)0.4425 per share to (pound)1.55 per share. Such
options are exercisable, and expire, at varying dates. The Executive Plan
expires on June 24, 1997 after which no more options can be granted under this
scheme.
ESOP Share Option Scheme. The ESOP Share Option Scheme (the "ESOP
Plan") was adopted by the Company in July 2, 1993 and expires on the tenth
anniversary of such date. Under the terms of the ESOP Plan, options may be
granted within the six weeks following the announcement by the Company of its
annual or half-yearly results, or otherwise in exceptional circumstances.
Options may be granted at any price, and are satisfied by the transfer
of shares held by the ESOP Trustee. No grant of an option may be made under the
ESOP Plan if it would cause the number of shares under option to exceed the
number of shares held by the ESOP Trustee. An option may not generally be
exercised earlier than three years, or more than seven years, after the date of
grant. Unexercised options will lapse on the option holder's ceasing to be a
director or employee of a Group Company, except to the extent that the ESOP
Trustee permits otherwise.
Unless the ESOP Trustee decides otherwise, no person may be granted an
option under the ESOP Plan if such grant would cause the value of shares under
all subsisting options granted to him in the preceding 10 years to exceed four
times his annual remuneration. For this purpose, options which have lapsed (but
not options which have been exercised) are to be treated as still subsisting.
The ESOP Plan may be altered by the Company with the consent of the ESOP
Trustee. As of the record date, options for a total of 733,700 Ordinary Shares
were outstanding under the ESOP Plan, at exercise prices ranging from
(pound)0.85 per Ordinary Share to (pound)1.33 per Ordinary Share. Such options
are exercisable, and expire, at varying dates.
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<PAGE>
PROPOSAL NUMBER 6
RE-APPOINTMENT OF AUDITORS
THE BOARD OF DIRECTORS RECOMMENDS
THE RE-APPOINTMENT OF PRICE WATERHOUSE TO HOLD
OFFICE UNTIL THE NEXT ANNUAL GENERAL MEETING
AND TO AUTHORIZE THE DIRECTORS TO FIX THEIR REMUNERATION
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<PAGE>
PROPOSAL NUMBER 7
APPROVAL OF THE COMPANY'S
1996 EQUITY INCENTIVE PLAN
On August 2, 1996, the Board of Directors of the Company (the "Board")
unanimously adopted the Equity Incentive Plan subject to the approval of such
plan by the shareholders of the Company, as more particularly described below.
The Company is adopting the Equity Incentive Plan at this time to attract or
retain employees who are in a position to make significant contributions to the
success of the Company and its subsidiaries through ownership of the Company's
Ordinary Shares ("Shares").
Grants of awards in the form of Options ("Awards") under the Equity
Incentive Plan may be made prior to approval of the plan by shareholders (but
after Board adoption of the Equity Incentive Plan), subject to such approval of
the Equity Incentive Plan. No Award of an incentive stock option may be granted
under the Equity Incentive Plan after ten years from the date of shareholder
approval but Awards previously granted may extend beyond that date.
Summary of the Equity Incentive Plan
The full text of the Equity Incentive Plan is set forth in Appendix A
to this Official Circular / Proxy Statement, and the following summary
description of certain features of the Equity Incentive Plan is qualified in its
entirety by such reference.
The Equity Incentive Plan is designed to advance the Company's
interests by enhancing its ability to attract and retain employees who are in a
position to make significant contributions to the success of the Company and its
subsidiaries through ownership of Shares. A total of 2,500,000 Shares, plus that
number of Shares as may become available by reason of forfeiture of Options
under the Company's Share Option Plans on or after August 2, 1996, are reserved
and available for Awards made under the Equity Incentive Plan, subject to
adjustment for Share dividends and similar events. From August 2, 1996 to
October 10, 1996, [________] options under the Share Option Plans were
forfeited. The Equity Incentive Plan provides for the grant of both "incentive
stock options," as defined in Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code") (any Option intended to qualify as an incentive stock
option being hereinafter referred to as an "ISO"), and Options that are not
incentive stock options. ISOs shall be awarded only to persons in the employ of
the Company or any of its subsidiaries ("Employees").
The Equity Incentive Plan will be administered by a committee of the
Board (the "Committee"). Only persons currently or formerly in the employ of the
Company or any of its subsidiaries ("Employees") and members of their families
(except without limitation nonEmployee (non-Executive) directors of the Company
or a subsidiary of the Company) who, in the opinion of the Committee, are in a
position to make a significant contribution to the success of the Company or its
subsidiaries will be eligible to receive Awards under the Equity Incentive Plan
("Participants").
The exercise price of an Option granted under the Equity Incentive Plan
may not be less than 100% (110% in the case of an ISO granted to a ten-percent
shareholder) of the fair market value of the Shares subject to the Option,
determined as of the time the Option is granted. A "ten-percent shareholder" is
any person who at the time of grant owns, directly or indirectly, or is deemed
to own by reason of the attribution rules of Section 424(d) of the Code, Shares
possessing more than 10% of the total combined voting power of all classes of
Shares of the Company or of its parent or subsidiary corporation. On October 10,
1996 the closing sales price of the Company's American Depositary Shares
("ADS"), equivalent to two (2) Ordinary Shares, on the NASDAQ National Market
was $[____] per ADS. In no case may the exercise price paid for Shares which is
part of an original issue of authorized Shares be less than the par value per
Share. The Committee may not reduce the exercise price of an Option at any time
after the time of grant unless the duration of such option were limited to seven
years. The term of each Option may be set by the Committee but cannot exceed 10
years from the day immediately preceding the date the Option was granted, or
such earlier date as may have been specified by the Committee at the time the
Option was granted (five years from the day immediately preceding such grant
date in the case of an ISO granted to a ten-percent shareholder).
Any exercise of an Option must be in writing, signed by the proper
person and delivered or mailed to the Company, accompanied by any documents
required by the Committee and payment in full for the number of Shares for which
the Option is exercised. The Option price may be paid in cash or by check
acceptable to the Company, bank draft or money order payable to the order of the
Company, or by delivery of an unconditional and irrevocable undertaking by a
broker to deliver promptly to the Company sufficient funds to pay the exercise
price, or if so permitted by the instrument evidencing the Option (or in the
case of an Option which is not an ISO, by the Committee on or after grant of the
Option), by delivery of a promissory note of the Option holder to the Company,
payable on such terms as are specified by the Committee, or by any combination
of the permissible forms of payment.
The Company may make a loan to any Participant other than a Director
("Loan"), either on the date of or after the grant of any Award to such
Participant. A Loan may be made either in connection with the purchase of Shares
under the Award or with the payment of any Federal, state and local income tax
with respect to income recognized as a result of the Award. No Loan may have a
term (including extensions) exceeding ten years in duration. Furthermore, in
connection with any Award, Learmonth & Burchett Management Systems, Inc., a
Company subsidiary, may at the time such Award is made or at a later date,
provide for and grant a cash award to the Participant ("Supplemental Grant") not
to exceed an amount equal to the amount of any Federal, state and local income
tax on ordinary income for which the Participant may be liable with respect to
the Award plus an additional amount on a grossed-up basis intended to
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make the Participant whole on an after-tax basis after discharging all the
Participant's income tax liabilities arising from all Awards.
Each Option will be exercisable at such time or times, and on such
conditions, as the Committee may specify. The Committee may at any time and from
time to time accelerate the time at which all or any part of the Option may be
exercised.
Except as otherwise provided by the Committee, if a Participant dies,
Options exercisable immediately prior to death may be exercised by the
Participant's executor or administrator or, if the Shareholder is not a citizen
of the United Kingdom, by the Participant's transferee, during a period of one
year following such death (or such shorter or longer period as the Board may
determine). Except as otherwise determined by the Committee, Options not
exercisable at a Participant's death terminate upon such death.
In the case of termination of a Participant's employment with the
Company for reasons other than death, except as otherwise provided by the
Committee, to the extent Options were exercisable immediately prior to such
termination, they remain exercisable for three months following such
termination, or such longer period as the Committee at the time may determine
(or for the remainder of their original term, if less), unless the Award
provides otherwise by its terms. Otherwise, all Options terminate to the extent
not exercisable immediately prior to such termination of the Participant's
employment with the Company. If any such termination of employment is due to the
Participant's discharge for cause, such Participant's Options may be terminated
immediately.
In the event of a "Change in Control," as defined in the Equity
Incentive Plan to include a new majority on the Board within eighteen months
after a tender or exchange offer or a proxy solicitation, all outstanding
Options shall become immediately exercisable in full.
In the event of the sale of all or substantially all of the assets of
the Company, all outstanding Options shall remain exercisable for a period of
six months following such sale, or for such shorter period (but in no event less
than 30 days) as may be provided in any plan or liquidation of the Company.
Certain U.S. Federal Income Tax Consequences
The following discussion, which is based on the law as in effect on
October 10, 1996, summarizes certain U.S. federal income tax consequences
associated with the grant and exercise of stock options under the Equity
Incentive Plan. The summary does not purport to cover the tax consequences
associated with other forms of awards nor does it cover federal employment tax
or other federal tax consequences or state, local or non-U.S. tax consequences.
Tax Consequences to Optionees. In general, an optionee realizes no
taxable income upon the grant or exercise of an incentive stock option. However,
the exercise of incentive stock options may result in any alternative minimum
tax liability to the optionee. With certain
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exceptions, a disposition by the optionee of Shares purchased under an incentive
stock plan within two years from the date of grant or within one year after
exercise produces ordinary income to the optionee equal to the value of the
Shares at the time of exercise less the exercise price. Any additional gain
recognized in the disposition is treated as a capital gain. If the optionee does
not dispose of the Shares until after the expiration of these one- and two-year
holding periods, any gain or loss recognized upon a subsequent sale is treated
as a long-term capital gain or loss.
In general, in the case of a nonstatutory option the optionee has no
taxable income at the time of grant but realizes income in connection with
exercise of the option in an amount equal to the excess (at the time of
exercise) of the fair market value of the Shares acquired upon exercise over the
exercise price; and any gain or loss recognized upon a subsequent sale or
exchange of the Shares will be treated as capital gain or loss.
In general, an incentive stock option that is exercised more than three
months after termination of employment (other than termination by reason of
death) is treated as a nonstatutory option. Incentive stock options awarded
under the Equity Incentive Plan will be treated as nonstatutory options to the
extent the fair market value (determined as of the date of the grant) of the
Shares with respect to which Options first become exercisable in any calendar
year exceeds $100,000.
Tax Consequences to the Company. The Company may claim a deduction for
the ordinary income realized by a Participant upon exercise of a nonstatutory
option or upon the disqualifying disposition of Shares purchased under an
incentive stock option. The Company's ability to claim a deduction may in some
cases depend on its satisfaction of applicable reporting requirements. In
addition, the Internal Revenue Code limits to $1,000,000 the deduction the
Company may claim for annual compensation to any of its five highest paid
officers as determined under the Internal Revenue Code, subject to a number of
exceptions. Under Section 162(m) of the Internal Revenue Code, the Company would
be unable in certain circumstances to claim a deduction upon the exercise of
Options granted to its top five executive officers (determined in accordance
with Section 162(m)) under the Equity Incentive Plan unless shareholder approval
of the Equity Incentive Plan is obtained.
Miscellaneous. The grant of an Option or the acceleration of
exercisability of an Option in connection with a change in ownership or
effective control of the Company or in connection with a change in ownership of
a substantial portion of the Company's assets may be treated as giving rise to a
"payment in the nature of compensation" required to be taken into account in
determining whether the Participant has received so-called "excess parachute
payments" under the Internal Revenue Code's golden-parachute rules. Where
applicable, those rules impose a 20% tax on excess parachute payments and deny a
deduction to the Company for such payments.
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Required Vote
Under the rules of the National Association of Securities Dealers,
Inc., the affirmative vote of the holders of a majority of the outstanding
Ordinary Shares (including Ordinary Shares underlying ADSs) entitled to vote and
present, in person or by proxy, at the AGM is required to approve the Equity
Incentive Plan.
THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF
THE COMPANY'S 1996 EQUITY
INCENTIVE PLAN
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PROPOSAL NUMBER 8
APPROVAL OF THE COMPANY'S
1996 U.S. EMPLOYEE STOCK PURCHASE PLAN
In August, 1996, the Board of Directors of Learmonth & Burchett
Management Systems Plc (the "Board" and "LBMS," respectively) unanimously
adopted the 1996 U.S. Employee Stock Purchase Plan (the "U.S. Plan"). LBMS is
adopting the U.S. Plan at this time to provide a method by which eligible
employees of LBMS and LBMS' subsidiaries (collectively, the "Company") may use
voluntary, systematic payroll deductions to purchase Ordinary Shares of LBMS
(the "Stock") and thereby acquire an interest in the future of the Company.
The U.S. Plan will become effective on the date on which it is approved
by the shareholders of LBMS. Such approval must be secured within twelve months
before or after the date the U.S. Plan is adopted by the Board (August 2, 1996).
All options ("Options") granted under the U.S. Plan prior to such approval are
conditioned on such approval being obtained prior to the exercise thereof.
Summary of the 1996 U.S. Employee Stock Purchase Plan
The full text of the U.S. Plan is set forth in Appendix B to this
Official Circular / Proxy Statement, and the following summary description of
certain features of the U.S. Plan is qualified in its entirety by such
reference.
The U.S. Plan is designed to advance the Company's interests by
providing a method by which eligible employees purchase Ordinary Shares of LBMS
and thereby acquire an interest in the future of the Company. Under the U.S.
Plan, there is available an aggregate of not more than 450,000 shares for sale
pursuant to the exercise of Options granted under the U.S. Plan, subject to
adjustment in the event of any change in the shares outstanding of LBMS by
reason of a stock dividend, split-up, recapitalization, merger, consolidation,
reorganization, or other capital change. The shares ("Shares") to be delivered
upon exercise of Options under the Plan may be either shares of authorized but
unissued Stock, shares of reacquired Stock, American Depositary Receipts for
American Depositary Shares, or any combination of the foregoing, as the Board
may determine.
The U.S. Plan will be administered by the Remuneration Committee of the
Board. Under such Plan, Options may be granted to any individual who elects to
participate and is an employee of an LBMS subsidiary designated by the Board or
an employee of LBMS, if the Board so determines, with a customary working
schedule of at least 20 hours per week, and who has been an Employee for at
least 90 days as of the first day of a period during which the U.S. Plan remains
in effect (an "Option Period"). Employees deemed to own stock possessing 5% or
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<PAGE>
more of the total combined voting power or value of all classes of shares of
LBMS or an LBMS subsidiary will not be eligible to participate in the U.S. Plan.
In addition, no Employee will be granted an Option under the U.S. Plan which
would permit his or her rights to purchase shares under all employee stock
purchase plans of LBMS and affiliates to accrue at a rate which exceeds $25,000
of fair market value of such shares (determined at the time such Option is
granted) for each calendar year in which such Option is outstanding at any time.
Eligible Employees elect to participate in the U.S. Plan
("Participants") by designating an amount of not less than 1% nor more than 15%
to be withheld from their regular rate of compensation by means of substantially
equal payroll deductions over a six-month Option Period. Such amounts withheld
will be credited to a separate withholding account, upon which no interest will
be payable, for each Participant. Unless changed or revoked by the Participant,
the payroll deduction authorization will remain in effect. A Participant may
reduce the withholding rate of his or her payroll deduction authorization by one
or more whole percentage points at any time during an Option Period by
delivering written notice to the Company, such reduction to take effect
prospectively as soon as practicable following receipt of such notice by the
Company; provided, that any reduction of the withholding rate to zero shall be
treated as a withdrawal. A Participant may increase or reduce the withholding
rate of his or her payroll deduction authorization for a future Option Period,
or cease participation entirely for a future Option Period, by written notice
delivered to the Company at least fifteen days prior to the first day of the
Option Period as to which the change is to be effective. A Participant may
terminate his or her payroll deduction authorization as of any date by written
notice delivered to the Company and, upon receipt of such notice by the Company,
will thereby cease to be a Participant as of such date. Any Participant who
voluntarily terminates his or her payroll deduction authorization prior to the
last business day of an Option Period will be deemed to have canceled his or her
Option. Upon such cancellation, the balance in his or her withholding account
will be returned.
On the first day of an Option Period, Participants are granted an
Option for such Period for the number of Shares determined by dividing (i)
Participant's withholding account balance on the last day of an Option Period by
(ii) the lesser of 85% of the fair market value of the Shares at (a) the time of
Option grant or (b) the time of Option exercise. Each Employee who is a
Participant in the U.S. Plan on the last business day of the Option Period will
be deemed to have exercised on the last business day of the Option Period the
Option granted to him or her for that Option Period.
Upon the termination of a Participant's employment with the Company for
any reason, including death, he or she will cease to be a Participant, and (i)
any Option held by such Participant will be deemed canceled, and (ii) LBMS will
deliver to such Participant or his or her estate the balance of his or her
withholding account.
Each Participant's rights and privileges under any Option may be
exercisable during his or her lifetime only by him or her, and may not be sold,
pledged, assigned or transferred in any manner.
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<PAGE>
The U.S. Plan shall terminate automatically following the end of the
Option Period beginning August 2, 2006; provided, however, that the Board in its
discretion may extend the U.S. Plan for one or more Option Periods. The U.S.
Plan may be suspended or terminated earlier by the Board; the U.S. Plan will
terminate in any case when all or substantially all of the Shares reserved for
the purposes of the Plan have been purchased.
THE BOARD OF DIRECTORS
RECOMMENDS APPROVAL OF
THE COMPANY'S 1996 U.S. EMPLOYEE
STOCK PURCHASE PLAN
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<PAGE>
PROPOSAL NUMBER 9
APPROVAL OF THE COMPANY'S
1996 NON-EMPLOYEE DIRECTORS'
SHARE OPTION PLAN
On September 26, 1996, the Board of Directors of the Company (the
"Board") unanimously adopted the Non-Employee Directors' Share Option Plan (the
"Plan") subject to approval of this Plan by vote of a majority of the
Shareholders of the Company or any of its subsidiaries, as more particularly
described below. The Company is adopting the Non-employee Directors' Share
Option Plan at this time so as to put itself in a position to attract and retain
non-employee directors who are in a position to make significant contributions
to the success of the Company and to reward Directors for such contributions
through ownership of shares of the Company's Ordinary Shares (the "Shares"). The
Company currently has no new candidates for directors and the Company does not
plan to issue options under this plan to any of its current directors. Options,
as hereinafter defined, may be granted under the Plan prior to the date of
Shareholder approval, and Options so granted shall be effective on the effective
date of grant subject to Shareholder approval of the Plan. No Options may be
awarded under the Plan after September 26, 2006, but the Plan shall continue
thereafter while previously awarded Options remain subject to the Plan.
Summary Of The Non-Employee Directors' Share Option Plan
The full text of the Plan is set forth in Appendix D to this Official
Circular / Proxy Statement, and the following summary description of certain
features of the Plan is qualified in its entirety by such reference. The Plan is
designed to advance the Company's interest by enhancing its ability to attract
and retain non-employee directors who are in a position to make significant
contributions to the success of the Company and to reward directors for such
contributions through ownership of Shares. The number of Shares which may be
issued upon the exercise of Options granted under the Plan, including Shares
forfeited because the Option lapses or is terminated shall not exceed 500,000
Shares in the aggregate, subject to increase in the event of a Share dividend,
Share split, combination, recapitalization, material change in law or in
accounting practices, merger, consolidation, acquisition, disposition, or other
similar event or transaction, which increases and appropriate adjustments as a
result thereof may be made by a Committee (the "Committee") of the Board of
Directors of the Company (the "Board") which shall consist of at least two
directors. The Committee may, at such time or times as it may choose, grant
options ("Options") on Shares or American Depositary Shares ("ADSs") to any
Eligible Director, as hereinafter defined; provided, however, that any Options
granted to Eligible Directors who are residents of the United States shall be
Options on ADSs. The exercise price and other terms and conditions of such
Options shall be determined by the Committee. All Options shall expire 10 years
after the effective date of grant. Directors eligible to receive Options under
the Plan ("Eligible Directors") shall be those directors who are not employees
of the Company or of any subsidiary of the Company at the time they become an
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<PAGE>
eligible Director and (i) who are directors on the effective date of this Plan
or (ii) who are first elected a director of the Company after the effective date
of this Plan.
The exercise price of Shares purchased on exercise of an Option must be
paid either (1) in cash or by check, bank draft or money order or (2) if
permitted by the Committee, by delivery of a promissory note or (3) by delivery
of an undertaking by a broker to deliver sufficient funds, or (4) by any
combination of these permissible forms of payment. Each Option will be
exercisable at such time or times, and on such conditions as the Committee may
specify. The Committee may at any time and from time to time accelerate the time
at which all or any part of an Option may be exercised, provide for the
acceleration of the exercisability of any Option upon the occurrence of certain
events, or extend the time by which an Option must be exercised.
If an Eligible Director ceases to be a director for reason of death or
total and permanent disability (as determined by the Committee), all Options
held by the Eligible Director that are not exercisable on the thirtieth day
after termination of the Eligible Director's status as a director will terminate
as of such date. All Options that are exercisable as of such thirtieth day will
continue to be exercisable until the earlier of (1) the first anniversary of the
date on which the Eligible Director's status as a director ended or (2) the date
on which the Option would have terminated had the Eligible Director remained a
director, and after completion of that period, such Options shall terminate to
the extent not previously exercised, expired or terminated. If the Eligible
Director has died or is totally or permanently disabled, the Option may be
exercised within such limits by the Eligible Director's legal representative. If
an Eligible Director's service with the Company terminates for any reason other
than death or incapacity, all Options held by the director that are not then
exercisable shall terminate. Options that are exercisable on the date of such
termination (other than termination upon removal for cause, in which event all
Options shall immediately terminate) shall continue to be exercisable until the
earlier of (1) three months thereafter or (2) the date on which the Option would
have terminated had the director remained an Eligible Director, and after
completion of that period, such Options shall terminate to the extent not
previously exercised, expired or terminated.
In the event of a "Change in Control," as defined in the Plan, if an
Eligible Director ceases to be a director following such change in control, and
if the Shares or ADSs are, following such change in control, traded on a major
stock exchange or inter-dealer quotation system in the United States or
elsewhere, any Option that was exercisable immediately before the termination
will continue to be exercisable for the full period during which it could be
exercised. Otherwise, in the event of a change of control, all outstanding
Options shall become immediately exercisable in full. In the event of the sale
of all or substantially all of the assets of the Company, all outstanding
Options shall remain exercisable for a period of six months following such sale,
or for such shorter period (but in no event less than 30 days) as may be
provided in any plan of liquidation of the Company.
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<PAGE>
Tax Consequences to Optionees. The Eligible Director or other
appropriate person shall remit to the Company an amount sufficient to satisfy
the withholding requirements, or make other arrangements satisfactory to the
Committee with regard to such requirements, prior to the delivery of any Shares.
THE BOARD OF DIRECTORS
RECOMMENDS APPROVAL OF
THE COMPANY'S 1996 NON-EMPLOYEE
DIRECTORS' SHARE OPTION PLAN
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<PAGE>
PROPOSAL NUMBER 10
APPROVAL OF AMENDMENT TO EXECUTIVE
SHARE OPTION SCHEME
The Board of Directors proposes that the Rules of the Executive Share
Option Scheme should be amended in order to treat Options under that Scheme in a
manner which is more in line with practice in the United States. Currently, such
Rules require that Options not be exercisable until 3 or 5 years following the
date of grant (depending on whether the Option is or is not a Super Option). The
Board also recommends eliminating the requirement to impose performance
conditions on Options.
The Board proposes that Type B Options granted under the Scheme in 1995
should be amended so that these Options will become exercisable after the second
anniversary of the date of grant in accordance with the vesting arrangements
governing those Options. These vesting arrangements provide for 40% of the
Shares subject to the Option to vest on the second anniversary of the date of
grant and a further 5% to vest at the end of each quarter thereafter if the
Option holder was at the end of that quarter still an executive for the purposes
of the Scheme. The Board further believes that the change in control, vesting
and exercise provisions should be further revised to conform to those in the
1996 Equity Incentive Plan so as to provide parity among employees. Type A
Options under the Plan, which are approved by the UK Internal Revenue, will not
be changed.
Thus, the Board of Directors has unanimously approved, subject to
shareholder approval, the following amendment to the Executive Share Option
Scheme:
1. Rule 4(2) shall be amended in respect of Options granted after the date
when the Board of Inland Revenue approves this amendment so that it
reads as follows:
"(2) Subject to sub-clauses (4) and (7) below and to Clause 5 below, a
notice exercising a Type A Option may not be given before the date(s)
specified in the certificate issued in respect of the Option."
2. Rules 4(3) and 11(3) shall be deleted and all references to those rules
in other rules of the Scheme shall be deleted. Rules 4(3) and 11(3)
shall be left blank and the subsequent rules shall not be renumbered.
3. Rule 11(2) shall be amended in respect of any Options granted on or
after April 12, 1995 to read as follows:
"(2) Subject to sub-clauses (4) and (7) below and to Clause 12 below, a
notice exercising a Type B Option may not be given before the date(s)
specified in the certificate issued in respect of the Option."
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<PAGE>
4. Rule 11(4) shall be amended to add at the beginning thereof,
immediately prior to the word "If" (which shall have the initial "I"
uncapitalized), the words "Subject to Clause 12 below".
5. Rule 11(7) shall be amended by adding the words "and Clause 12 below"
immediately following the words "sub-clause (4) above" and before the
",".
6. Rule 12(1) is amended to read in full as follows:
(1) In the event of a Change of Control, all outstanding Type B Options
shall become immediately exercisable in full. For the purposes of this
plan, a "Change in Control" shall mean any of the following:
(a) any Person or "group" (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934), other than the
Company or any of its Affiliates, becomes a beneficial owner (within
the meaning of Rule 13d-3 as promulgated under the U.S. Securities
Exchange Act of 1934), directly or indirectly, of securities
representing thirty percent (30%) or more of the total number of votes
that may be case for the election of directors of the Company;
(b) there occurs any sale of all or substantially all of the assets of
the Company;
(c) within eighteen months after a tender offer or exchange offer for
voting securities of the Company (other than by the Company)
individuals who were directors of the Company immediately prior thereto
shall cease to constitute a majority of the Board;
(d) proxies are solicited voting securities of the Company by persons
other than the Company or its Board and within eighteen months
thereafter individuals who were directors of the Company immediately
prior to such transaction cease to constitute a majority of the Board;
(e) any Person or "group" obtains control of the Company in pursuance
of a compromise or arrangement sanctioned by the court under Section
425 of the Companies Act 1985; or
(f) any Person or "group" acquires all or the major part of the
undertaking of the Company pursuant to a reorganization under Section
110 of the Insolvency Act of 1986.
7. Rule 12(4) is hereby deleted and rules 12(2) and 12(3) are renumbered
12(3) and 12(4). A new Rule 12(2) is hereby added reading in full as
follows:
(2) If a Participant ceases to be an employee or director following a
"Change in Control" (as defined above), and if the Company's ordinary
shares or ADSs are, following such change in control, traded on a major
stock exchange or inter-dealer
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<PAGE>
quotation system in the United States or elsewhere, any Options that
were exercisable immediately before such cessation will continue to be
exercisable for the full period during which they could be exercised in
the absence of such cessation, except in the case of a sale of all or
substantially all of the assets of the Company. In the event of the
sale of all or substantially all of the assets of the Company, all
outstanding Type B Options shall remain exercisable for a period of six
months following such sale, or for such shorter period (but in no event
less than 30 days) as may be provided in any arrangement for the
liquidation of the Company.
THE BOARD OF DIRECTORS
RECOMMENDS APPROVAL OF
THE AMENDMENT TO EXECUTIVE SHARE
OPTION SCHEME DESCRIBED ABOVE
The Board of Directors has also unanimously approved, subject to
shareholder approval, the following amendment to Schedule 1 annexed to the Share
Option Certificates issued in respect of Type B Options granted in the calendar
year 1995 under the Executive Share Option Scheme:
THAT paragraph 1(b) of Schedule 1 (Exercise Conditions) be amended to
read as follows:
"This Option may be exercised at any time after the second anniversary
of the Grant Date to the extent that the Option has vested in
accordance with the Vesting Arrangements set out in Schedule 2 and
provided that a U.S. listing shall have taken place by that date;"
THE BOARD OF DIRECTORS
RECOMMENDS APPROVAL OF THE
AMENDMENT TO THE SHARE
OPTION CERTIFICATES
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<PAGE>
PROPOSALS NUMBER 11 AND 12
DISAPPLICATION OF PREEMPTIVE
RIGHTS CONFERRED UNDER
THE COMPANIES ACT
Proposal No. 12 will provide the directors with authority under the UK
Companies Act 1985 to allot relevant securities having an aggregate nominal
value not exceeding the nominal value of the present unissued share capital of
the Company. This power expires at the date of the next AGM of the Company:
That the Directors of the Company be and are generally and
unconditionally authorized to exercise all powers of the Company to
allot relevant securities (as defined in Section 80 of the Companies
Act 1985) up to an aggregate nominal amount of (pound)728,297 provided
that the authority shall expire on the date of the next Annual General
Meeting of the Company save that the Company may before such expiry
make an offer or agreement which would or might require relevant
securities to be allotted after such expiry and Directors may allot
relevant securities in pursuance of such an offer or agreement as if
the authority conferred hereby had not expired.
Proposal No. 13 will give the Directors the power to allot equity
securities for cash otherwise than on a preemptive basis having an aggregate
nominal amount equal to (pound)[__] representing fifteen per cent of the issued
share capital of the Company as shown in the Company's latest audited Balance
Sheet and also, in the case of a rights issue, to allot shares where necessary
other than strictly in accordance with the preemptive provisions set out in
Section 89 of the Companies Act 1985. This power will continue until expiry at
the next AGM of the Company:
That the Directors be empowered pursuant to section 95 of the Companies
Act 1985 to allot equity securities (as defined in section 94 of that
Act) for cash pursuant to the authority conferred on them by Proposal
No. 12 above, as if Section 89(1) of that Act did not apply to such
allotment provided that this power shall be limited to:
(i) The allotment of equity securities in connection with a rights
issue in favour of ordinary share holders where the equity securities
respectively attributable to the interests of all ordinary share
holders are proportionate (as nearly as may be) to the respective
numbers of ordinary shares held by them, subject to such exclusions or
other arrangements as the Directors may deem necessary or expedient in
relation to fractional entitlements or legal or practical problems
arising under the law of or the requirements of any regulatory body or
any stock exchange in any overseas territory or otherwise.
(ii) The allotment (otherwise than pursuant to sub-paragraph (i) above)
of equity securities up to an aggregate nominal value of (pound)109,244
and shall expire on the date of the next Annual General Meeting of the
Company provided that the Company may make
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<PAGE>
an offer or agreement before this power has expired, which would or
might require securities to be allotted after such expiry and the
Directors may allot equity securities in pursuance of such offer or
agreement as if the power conferred hereby had not expired.
THE BOARD OF DIRECTORS RECOMMENDS
ADOPTING THE PROPOSAL TO
DISAPPLY THE PREEMPTIVE RIGHTS
CONFERRED UNDER THE U.K. COMPANIES ACT
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<PAGE>
SHAREHOLDER PROPOSALS
Pursuant to Rule 14a-8 promulgated by the SEC, shareholder proposals
intended to be included in the Company's proxy material for the Company's 1997
AGM of Shareholders must be received by the Company on or before _____________
at its principal office, 1800 West Loop South, Suite 900, Houston, Texas 77027
Attention: Corporate Secretary.
OTHER MATTERS
The management has no knowledge of any other matter that may come
before the AGM and does not, itself, currently intend to present any such other
matter. However, if any such other matters properly come before the meeting or
any adjournment thereof, the persons named as proxies will have discretionary
authority to vote the shares represented by the accompanying proxy in accordance
with their own judgement.
PROXY SOLICITATION
The cost of soliciting proxies will be paid by the Company. Proxies may
be solicited without extra compensation by certain directors, officers and
regular employees of the Company by mail, telegram or personally.
Shareholders are urged to send their proxies without delay. Your
cooperation is appreciated.
FORM 10-K
A copy of the Company's annual report on Form 10-K filed with the
Securities and Exchange Commission is available without charge by writing to:
Learmonth & Burchett Management System Plc, ATTN: Mr. Stephen E. Odom, 1800
West Loop South, Suite 900, Houston, Texas 77027.
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<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE PROPOSAL.
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Meeting. The Directors recommend a vote FOR the
proposal.
<TABLE>
<S> <C>
1. Proposal to receive and adopt the Directors' Report and the |_| FOR |_| AGAINST |_| ABSTAIN
audited accounts for the year ended April 30, 1996, as
described in the Proxy Statement and the Directors'
Report and the audited accounts for the year ended April
30, 1996.
2. Proposal to re-elect Gerald N Christopher who was appointed |_| FOR |_| AGAINST |_| ABSTAIN
as a Director on August 2, 1996, as described in the Proxy
Statement.
3. Proposal to re-elect Michael S Bennett who was appointed |_| FOR |_| AGAINST |_| ABSTAIN
as a Director on August 2, 1996, as described in the Proxy
Statement.
4. Proposal to re-elect David B Rodway who was appointed |_| FOR |_| AGAINST |_| ABSTAIN
Director by rotation, as described in the Proxy Statement.
5. Proposal to re-elect Rainer H Burchett who retires as a |_| FOR |_| AGAINST |_| ABSTAIN
Director by rotation, as described in the Proxy Statement.
6. Proposal to re-appoint the auditors Price Waterhouse to |_| FOR |_| AGAINST |_| ABSTAIN
hold office until the next Annual General Meeting and to
authorize the Directors to fix their remuneration, as
described in the Proxy Statement.
7. Proposal to approve the adoption of the 1996 Equity |_| FOR |_| AGAINST |_| ABSTAIN
Incentive Plan, as described in the Proxy Statement and the
1996 Equity Incentive Plan.
8. Proposal to approve the adoption of the 1996 U.S. |_| FOR |_| AGAINST |_| ABSTAIN
Employee Stock Purchase Plan, as described in the Proxy
Statement and the 1996 U.S. Employee Stock Purchase
Plan.
9. Proposal to approve the adoption of the 1996 Non-employee |_| FOR |_| AGAINST |_| ABSTAIN
Directors' Share Option Plan, as described in the Proxy
Statement and the 1996 Non-employee Directors' Share
Option Plan.
10. Proposal to approve an amendment to the Executive Share |_| FOR |_| AGAINST |_| ABSTAIN
Option Scheme and to certain Type B option certificates
relating to options granted thereunder regarding new
vesting arrangements, as described in the Proxy Statement.
11. Proposal to authorize the Directors to allot shares, as |_| FOR |_| AGAINST |_| ABSTAIN
described in the Proxy Statement.
<PAGE>
12. Proposal to approve disapplication of preemptive rights of |_| FOR |_| AGAINST |_| ABSTAIN
holders of ordinary shares, as described in the Proxy
Statement.
</TABLE>
PLEASE SIGN ON THE REVERSE SIDE AND RETURN
PROMPTLY IN THE ENCLOSED ENVELOPE.
- -------------------------------------------------------------------------------
LEARMONTH & BURCHETT PROXY SOLICITED BY THE BOARD OF DIRECTORS
MANAGEMENT SYSTEMS PLC
PROXY FOR ANNUAL GENERAL MEETING
OF SHAREHOLDERS -- NOVEMBER 15, 1996
The undersigned hereby appoints [_____________], and each of [them], proxies,
with power of substitution to [each], and hereby authorizes [them] to represent
and to vote, as designated below, at the Annual General Meeting of Shareholders
of the Company indicated above, on November 15, 1996 at 11:00 a.m. CST, and at
any adjournments thereof, all of the ordinary shares of the Company (including
those ordinary shares underlying American Depositary Shares) which the
undersigned would be entitled to vote if personally present.
NOTE: Please sign exactly as your name appears on
this card. All joint owners should sign. When signing
as executor, administrator, attorney, trustee or
guardian or as custodian for a minor, please give
full title as such. If a corporation, please sign in
full corporate name and indicate the signer's
office. If a partner, sign in the partnership name.
Signature(s):
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Date
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