<PAGE>
As filed with the Securities and Exchange Commission on June 7, 1996
Registration No. 33-______
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
INTEGRATED SYSTEMS CONSULTING GROUP, INC.
(Exact name of registrant as specified in its charter)
------------------
Pennsylvania 23-2528944
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.
575 East Swedesford Road
Suite 200
Wayne, Pennsylvania 19087
-------------------- -----------------
(Address of Principal Executive Offices) (Zip Code)
---------------
INTEGRATED SYSTEMS CONSULTING GROUP, INC.
AMENDED AND RESTATED 1989
INCENTIVE STOCK OPTION PLAN
(Full title of the plan)
------------------
DAVID D. GATHMAN
Chief Operating Officer
575 East Swedesford Road
Suite 200
Wayne, PA 19087
(Name and address of agent for service)
------------------
(610) 989-7000
(Telephone number, including area code, of agent for service)
Copy to:
DAVID S. ANTZIS, ESQUIRE
Saul, Ewing, Remick & Saul
1055 Westlakes Drive, Suite 150
Berwyn, PA 19312
(610) 251-5055
------------------------
See next page for calculation of registration fee.
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================================
Proposed
Proposed Maximum
Title of Securities to Amount to be Maximum Offering Aggregate
be Registered Registered Price Per Share(5) Offering Price(5) Amount of Registration Fee (5)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, Par 753,702(1) $ 1.928 (6) $ 1,453,137 $3,939.45
Value $.005 Per Share 367,651(2) 23.75 8,731,711
128,647(3) 0.4133(6) 53,170
49,950(4) 23.75 1,186,313
------
1,299,950 $11,424,331
========= ===========
================================================================================================================================
</TABLE>
(1) Represents shares issuable upon exercise of options previously
granted but not yet exercised under the Amended and Restated 1989 Incentive
Stock Option Plan.
(2) Represents shares issuable in connection with the options available
for grant under the Amended and Restated 1989 Incentive Stock Option Plan.
(3) Represents shares previously issued upon the exercise of options
previously granted under the Amended and Restated 1989 Incentive Stock Option
Plan.
(4) Represents shares previously issued pursuant to certain stock
dividends and stock splits declared by the Registrant on shares previously
issued upon the exercise of options previously granted under the Amended and
Restated 1989 Incentive Stock Option Plan.
(5) The registration fee with respect to these shares has been computed
in accordance with paragraphs (c) and (h) of Rule 457, based upon, in the case
of options previously granted and shares previously issued pursuant to the
exercise of options, the average of the stated exercise price of such options
and shares and, in the case of options still available for grant and shares
issued pursuant to stock splits and stock dividends, the average of the reported
high and low sale prices of shares of Common Stock on June 3, 1996.
(6) Represents the average exercise price of options previously granted
and shares previously issued pursuant to the exercise of options.
-2-
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.(1)
Item 2. Registrant Information and Employee Plan Annual Information.(1)
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed in clauses (a) and (b) below are
incorporated by reference in this Registration Statement, and all documents
subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by this reference in this Registration Statement and to be a
part hereof from the date of filing of such documents.
(a) The Registrant's latest prospectus dated April 17, 1996 filed
pursuant to Rule 424(b) under the Securities Act of 1933, that contains audited
financial statements for the Registrant's latest fiscal year for which such
statements have been filed.
(b) The Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1996.
(c) The description of the Common Stock contained in the registration
statement filed by the Registrant to register such securities under Section 12
of the Securities Exchange Act of 1934, including any amendment or report filed
for the purpose of updating such description.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
- --------
(1) The information called for by Part I of Form S-8 is currently included
in the description of the Registrant's Amended and Restated 1989
Incentive Stock Option Plan (the "Plan"). Pursuant to the Note to Part
I of Form S-8, this information is not being filed with this Form S-8.
Pursuant to General Instruction C of Form S-8, this Registration
Statement contains a prospectus prepared in accordance with the
requirements of Part I of Form S-3 relating to reofferings and resales
of the Registrant's common stock acquired pursuant to the Plan which is
deemed to be "restricted securities" or "control securities" and shares
issued pursuant to certain stock dividends and stock splits thereon.
-3-
<PAGE>
Item 6. Indemnification of Directors and Officers.
The Registrant's By-laws require the Registrant to indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed proceeding by reason of the fact that he is or
was a director or officer of the Registrant or is or was serving at the request
of the Registrant as a director, officer, employee, fiduciary or agent of
another corporation, trust or other enterprise against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such proceeding if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the Registrant, and, with respect to any such criminal
proceeding, had no reasonable cause to believe his conduct was unlawful. Such
indemnification as to expenses is mandatory to the extent the individual is
successful on the merits of the matter. Pennsylvania law permits the Registrant
to provide similar indemnification to employees and agents who are not directors
or officers. The determination of whether an individual meets the applicable
standard of conduct may be made by the disinterested directors, independent
legal counsel or the stockholders. Pennsylvania law also permits indemnification
in connection with a proceeding brought by or in the right of the Registrant to
procure a judgment in its favor. The Registrant has entered into an
Indemnification Agreement with each of its directors. Insofar as indemnification
for liabilities arising under the Securities Act of 1933, as amended (the
"Act"), may be permitted to directors, officers, or persons controlling the
Registrant pursuant to the foregoing provisions, the Registrant has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in that Act and is
therefore unenforceable. The Registrant has obtained a directors and officers
liability insurance policy.
Item 7. Exemption from Registration Claimed.
In granting the options and selling the underlying securities
upon exercise which constitute the "restricted securities" which are being
registered for reoffer and resale pursuant to this Registration Statement, the
Registrant is relying on the exemptions to registration set forth in Rule 701
under, and Section 4(2) of, the Act.
Item 8. Exhibits.
The following is a list of exhibits filed as part of the
Registration Statement:
5 Opinion of Saul, Ewing, Remick & Saul
23.1 Consent of KPMG Peat Marwick LLP, independent certified public
accountants
23.2 Consent of Saul, Ewing, Remick & Saul (contained in Exhibit
No. 5)
24 Power of Attorney (included on signature page of the
Registration Statement)
99.1 Amended and Restated 1989 Incentive Stock Option Plan
(incorporated herein by reference to the Exhibit 10.1 to the
Registration Statement on Form S-1 (File No. 333- 00790)
declared effective by the Securities and Exchange Commission
on April 17, 1996).
-4-
<PAGE>
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such
information in the Registration Statement;
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liability (other than payment by the Registrant of
expenses incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
-5-
<PAGE>
PROSPECTUS
1,299,950 Shares
INTEGRATED SYSTEMS CONSULTING GROUP, INC.
Common Stock
----------------------------------------------
This Prospectus relates to the offer and sale by certain selling
stockholders (the "Selling Stockholders") of Integrated Systems Consulting
Group, Inc., a Pennsylvania corporation ("ISCG" or the "Company"), of up to
1,299,950 shares (the "Shares") of common stock, par value $.005 per share (the
"Common Stock"), 1,250,000 of which have been or may be acquired from time to
time by the Selling Stockholders upon their exercise of certain stock options
granted to the Selling Stockholders under the Integrated Systems Consulting
Group, Inc. Amended and Restated 1989 Incentive Stock Option Plan (the "Plan")
and 49,950 of which were issued by the Company in the form of stock dividends
and stock splits on shares of Common Stock acquired by the Selling Stockholders
upon the exercise of stock options granted under the Plan.
The Selling Stockholders may from time to time sell all or part of the
Shares offered hereby in ordinary brokers' transactions on the Nasdaq National
Market, or in privately negotiated transactions at negotiated prices, or
otherwise. All of the expenses associated with this registration will be paid by
the Company. The Company will not receive any proceeds from the sale of the
Shares.
The Common Stock is included for quotation on the Nasdaq National
Market under the symbol "ISCG." On June 3, 1996, the closing sale price of the
Company's Common Stock as quoted on the Nasdaq National Market was $24.50 per
share.
-----------------------------------------------
An investment in the Common Stock offered
hereby involves a high degree of risk. See
"RISK FACTORS" on pages A-3 to A-6.
-----------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is June 7, 1996
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports and other information with the Commission.
The reports, proxy and information statements and other information filed by the
Company may be inspected and copied at the public reference facilities
maintained by the Commission located at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the public reference facilities in the regional
offices of the Commission located at 7 World Trade Center, Suite 1300, New York,
New York 10048, and 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material can be obtained from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549,
at prescribed rates.
A copy of any document (but not exhibits thereto) incorporated by
reference in the Registration Statement of which this Prospectus forms a part
but which is not delivered with this Prospectus will be provided by the Company
without charge to any person to whom this Prospectus has been delivered, upon
the oral or written request of such person. Such requests should be directed to
David D. Gathman, Chief Operating Officer, 575 East Swedesford Road, Suite 200,
Wayne, PA 19087, (610) 989-7000.
A-2
<PAGE>
RISK FACTORS
Investment in the Common Stock offered hereby involves certain risks.
Before deciding to purchase any of the Common Stock offered hereby, prospective
investors should carefully consider the following factors, among others set
forth in this Prospectus.
Dependence on Pharmaceutical Industry. The Company has in the past
derived, and may in the future derive, a significant portion of its revenues
from companies in the pharmaceutical industry. Revenues derived by the Company
from the pharmaceutical industry during 1993, 1994 and 1995 accounted for
approximately 59%, 61% and 64%, respectively, of total revenues. In particular,
the Company's revenues are highly dependent on research and development
expenditures by the pharmaceutical industry. The Company's operations could be
materially and adversely affected by certain changes in the general economic
environment within the pharmaceutical industry or the impact of the current
trend toward consolidation in or decreases in research and development
expenditures in that industry. Furthermore, the Company has benefited to date
from the increasing tendency of pharmaceutical companies to outsource large
information technology dependent research projects. A reversal or slowing of
this trend would have a material adverse effect on the Company's results of
operations.
Attraction and Retention of Technical Employees. The Company's business
involves the delivery of professional services and is, therefore,
labor-intensive. The Company believes that its future success will depend in
large part upon its ability to attract, retain and motivate highly skilled
employees, particularly technical employees. Information services professionals
are in great demand and are likely to remain a limited resource for the
foreseeable future. Although the Company expects to continue to attract and
retain sufficient numbers of highly skilled technical employees, there can be no
assurance that the Company will be able to do so. The loss of a significant
number of the Company's technical employees could have a material adverse impact
on the Company, including its ability to secure and complete engagements.
Concentration and Mix of Revenues. Historically, a small number of
clients have each accounted for 10% or more of the Company's revenues. In 1994,
Merck & Company, Inc. ("Merck") accounted for approximately 17% of the Company's
revenues; and, in 1995, Air Products and Chemicals, Inc. ("Air Products") and
Merck accounted for approximately 13% and 11% of revenues, respectively. One of
these clients recently issued a request for proposals to vendors seeking to
provide information technology consulting services, although this client has
advised the Company that it will not make any determination until at least
mid-1997. An unanticipated reduction of a significant amount of business from
either of these clients may have a material adverse effect on the Company's
results of operations.
Since the implementation of a large software application is a complex,
time intensive and costly process, clients generally undertake these projects on
an irregular basis. As a result, the amount of revenues derived by the Company
from any given client likely may vary significantly from year-to-year.
Accordingly, the Company expects that clients accounting for large portions of
its revenues will change from year-to-year. The inability of the Company to
maintain its personnel utilization rates (i.e. the ratio of hours billed to
total available hours) following the completion of large engagements, either by
securing new engagements or by utilizing its technical employees for existing
engagements, could be expected to have a material adverse effect on the
Company's results of operations during such period.
A-3
<PAGE>
Management of Growth and Utilization of Resources. From January 1, 1992
through December 31, 1995, the size of the Company's professional staff
increased from 61 to 254 technical personnel, including an increase of 81
technical personnel during 1995. Further significant increases are anticipated
during 1996. As employee related costs are relatively fixed, variations in the
Company's revenues and operating results can occur as a result of variations in
billing margins and utilization rates of its technical employees. If the
Company's management is unable to manage growth effectively and new technical
employees are unable to achieve anticipated performance levels, the Company's
results of operations could be adversely affected.
Reliance on Vendor Relationships. The Company has established
non-exclusive partnership arrangements with two organizations, Documentum, Inc.
("Documentum") and DLB Systems, Inc. ("DLB"), that it believes are important to
its sales, marketing and support activities. Both Documentum and DLB market
software applications to the pharmaceutical industry. The Company's history of
integrating these vendors' software products into clients' systems has led to
strong relationships with these vendors, enhancing the Company's marketing
efforts. These partnership arrangements position the Company as a potential
systems integrator should clients or prospective clients select one of these
vendors' products. These relationships have often resulted in sales leads and
the generation of client engagements. The failure by the Company to maintain
these relationships or to establish new relationships in the future could have a
material adverse effect on the Company's results of operations.
Technological Advances. The information technology industry has
experienced and is continuing to experience rapid technological advances and
developments. The Company's success will depend in part on its ability to
develop solutions which keep pace with continuing changes in information
processing technology, evolving industry standards and changing client
preferences. There can be no assurance that the Company will be successful in
addressing these developments on a timely basis or that, if addressed, the
Company will be successful in the marketplace. The Company's delay or failure to
address these developments would have a material adverse effect on the Company's
results of operations. In addition, there can be no assurance that technologies
developed by others will not render the Company's services noncompetitive or
obsolete.
Competition. The commercial professional services segment of the
information technology industry includes a large number of participants and is
highly competitive. The Company competes with and faces potential competition
for client assignments and experienced personnel from a number of companies that
have significantly greater financial, technical and marketing resources and have
greater name recognition. The Company also faces competition from organizations
providing staff augmentation services to, and individuals who contract directly
with, information systems departments of existing and potential clients. The
Company's client focus primarily consists of companies within the pharmaceutical
industry for which there are a number of professional services firms seeking
information technology consulting and applications development engagements. The
Company believes that the principal competitive factors in the commercial
professional services segment of the information technology industry include
responsiveness to client needs, availability of technical personnel, speed of
applications development, quality of service, price, project management
capability and technical expertise. The Company believes that its ability to
compete also depends in part on a number of competitive factors outside its
control, including the ability of its competitors to hire, retain and motivate
qualified technical personnel, the ownership by competitors of software used by
potential clients, the development of software that would reduce or eliminate
the need for the Company's services, the price at which others offer comparable
services and the extent of its competitors' responsiveness to customer needs.
A-4
<PAGE>
Dependence on Key Personnel. The Company believes that its continued
success depends to a significant extent upon the efforts and abilities of its
senior management. In particular, the loss of services of David S. Lipson, the
Company's Chairman, Chief Executive Officer and President, or any of the
Company's other executive officers or senior managers could have a material
adverse effect on the Company's results of operations. The Company has entered
into employment agreements with each of its executive officers.
Dependence on Government Regulation. A substantial portion of the
Company's business depends on the comprehensive government regulation of the
drug development process. In the United States, the general trend has been in
the direction of continued or increased regulation, although the U.S. Food and
Drug Administration (the "FDA") recently announced regulatory changes intended
to streamline the approval process for pharmaceutical and biotechnology
products.
Control by Principal Stockholders. David S. Lipson, Safeguard
Scientifics, Inc. ("Safeguard"), and a venture capital fund comprised of
Technology Leaders II L.P. and Technology Leaders II Offshore C.V. (collectively
"Technology Leaders II"), the three largest stockholders of the Company,
beneficially own in the aggregate approximately 64.3% of the outstanding Common
Stock. As a result, such stockholders collectively have the voting power to
elect the Company's entire Board of Directors and to approve all matters
requiring stockholder approval. The vote of the shares held by Technology
Leaders II is controlled by the majority vote of an executive committee
comprised of eleven voting members and one nonvoting member; the voting members
include one person designated by a wholly-owned subsidiary of Safeguard.
Requirements for Listing Securities on the Nasdaq National Market;
Application of the Penny Stock Rules. The Common Stock is listed by the Nasdaq
National Market. If the Company is unable to maintain the standards for
continued listing, the Common Stock could be subject to delisting from the
Nasdaq National Market. Trading, if any, in the Common Stock would thereafter be
conducted on an electronic bulletin board established for securities that do not
meet the Nasdaq listing requirements or in what is commonly referred to as the
"pink sheets." As a result, an investor may find it more difficult to dispose
of, or to obtain accurate quotations as to the price of, the Company's
securities.
In addition, if the Company's securities were delisted, they would be
subject to the so-called penny stock rules that impose additional sales practice
requirements on broker-dealers who sell such securities to persons other than
established customers and accredited investors (generally defined as an investor
with a net worth in excess of $1,000,000 or annual income exceeding $200,000, or
$300,000 together with a spouse). For transactions covered by this rule, the
broker-dealer must make a special suitability determination for the purchaser
and must have received the purchaser's written consent to the transaction prior
to sale. Consequently, delisting, if it occurred, may affect the ability of
broker-dealers to sell the Company's securities and the ability of purchasers to
sell their securities in the secondary market.
The Commission has adopted regulations that define a "penny stock" to
be any equity security that has a market price (as defined in the regulations)
of less than $5.00 per share or an exercise price of less than $5.00 per share,
subject to certain exceptions. For any transaction involving a penny stock,
unless exempt, the rules require the delivery, prior to the transaction, of a
disclosure schedule relating to the penny stock market. The broker-dealer also
must disclose the commissions payable to both the broker-dealer and the
registered representative, current quotations for the securities and, if the
broker-dealer is the sole market-maker, the broker-dealer must disclose this
fact and the broker-dealer's presumed control over the market. Finally, monthly
statements must be sent disclosing recent price information for the penny stock
held in the account and information on the limited market in penny stocks. As a
result, if the Common Stock is determined to be "penny stock," an investor may
find it more difficult to dispose of the Company's Common Stock.
A-5
<PAGE>
No Prior Market; Possible Volatility of Stock Price. Prior to the
initial public offering of the Company's Common Stock pursuant to the filing of
a Registration Statement on Form S-1 which was declared effective by the
Commission on April 17,1996, there has been no public market for the Common
Stock, and there can be no assurance that an active public market will develop
or be sustained. The public markets, in general, have from time to time
experienced extreme price and volume fluctuations, which have in some cases been
unrelated to the operating performance of particular companies, and the market
for technology stocks, such as the Common Stock, can be subject to greater price
volatility than the stock market in general. In addition, factors such as
announcements of technological innovations, announcements of new products by the
Company's competitors or third parties, and market conditions in the information
technology industry may have a significant impact on the market price of the
Common Stock.
Possible Issuances of Preferred Stock. Shares of preferred stock may be
issued by the Company in the future without stockholder approval and upon such
terms as the Board of Directors may determine. The rights of the holders of the
Common Stock will be subject to, and may be adversely affected by, the rights of
the holders of any preferred stock that may be issued in the future. The
issuance of preferred stock, while providing flexibility in connection with
possible acquisitions and other corporate purposes, could have the effect of
making it more difficult for a third party to acquire, or of discouraging a
third party from acquiring, a majority of the outstanding stock of the Company
and potentially prevent the payment of a premium to stockholders in an
acquisition transaction. The Company has no present plans to issue any shares of
preferred stock.
No Dividends. To date, the Company has not paid any cash dividends on
its Common Stock, and does not expect to declare or pay any cash or other
dividends in the foreseeable future. Further, the Company's bank loan agreement
prohibits the Company from declaring or paying dividends or other distributions
on its Common Stock.
A-6
<PAGE>
THE COMPANY
The Company provides consulting services that address its clients'
information processing needs through technologically advanced solutions,
including client-server architecture, graphical user interface-based
applications, local and distributed relational databases and cross-platform
applications integration. The Company delivers consulting services in two broad
areas: applications development and network management. In the applications
development area, the Company provides expertise to its clients in the full
software development life cycle or one or more discrete phases within such
process.
Historically, the Company has provided consulting services to
businesses in a variety of industries such as pharmaceutical, biotechnology,
chemical, publishing, software development and general manufacturing. In recent
years, however, the Company has principally focused its marketing efforts on the
pharmaceutical industry in order to exploit more effectively its extensive
experience in the implementation, development and management of information
systems used in connection with the drug development process. By virtue of this
experience, the Company's technical employees have developed a strong
understanding of the drug development process and broad expertise in the
information systems and software applications required to support this
complicated and data intensive process. In addition, the Company's technical
employees have developed a broad range of technical skills and capabilities with
respect to commercially available packaged software products that address drug
development information processing requirements.
The Company's principal executive offices are located at 575 East
Swedesford Road, Suite 200, Wayne, Pennsylvania 19087, and its telephone number
is (610) 989-7000, its World Wide Web homepage address is http://www.iscg.com
and its e-mail address is [email protected].
SELLING STOCKHOLDERS
This Prospectus relates to the Shares that may be acquired by the
Selling Stockholders pursuant to the exercise of options that have been, or may
be in the future, granted pursuant to the Plan, Shares that have been previously
acquired by the Selling Stockholders pursuant to the exercise of options granted
to the Selling Stockholders pursuant to the Plan and Shares that have been
issued by the Company pursuant to stock dividends and stock splits on shares
that were acquired by the Selling Stockholders pursuant to the exercise of
options granted to the Selling Stockholders under the Plan. The following table
sets forth certain information with respect to certain Selling Stockholders who
currently hold options to purchase Shares and Selling Stockholders who currently
hold Shares from previously exercised options and stock dividends and stock
splits. The Company is unaware of whether the Selling Stockholders listed below
presently intend to sell the Shares that they own or which they may acquire upon
exercise of options. The Company in the future may grant additional options to
the persons listed below and to persons other than those listed below whose
subsequent sale of the Shares will be covered by this Prospectus, which, in such
case, will be supplemented. Certain stockholders who are not affiliates of the
Company and who own less than One Thousand (1,000) Shares have been omitted from
the table; however, the Shares owned by such non-affiliate stockholders are
covered by this Prospectus and may be reoffered and resold.
A-7
<PAGE>
<TABLE>
<CAPTION>
Number of Shares (and
Number of Shares Number of Shares Percentage of Outstanding
Beneficially Owned Offered for Selling Shares) Beneficially Owned
Name and Prior to this Stockholder's After Completion of this
Position with the Company Offering(1) Account(2) Offering(3)
- ------------------------- ------------------ ------------------- ---------------------------
<S> <C> <C> <C>
Frank Baldino 5,000 15,000 5,000(*)
Director
Melvyn E. Bergstein 10,433 15,000 10,433(*)
Director
David F. Elderkin 97,400(4) 137,550 5,000(*)
Vice President
David D. Gathman 74,467(5) 143,400 5,000(*)(5)
Chief Operating Officer
James L. Mann 8,000 15,000 8,000(*)
Director
Jay M. Rose 20,000(6) 41,250 5,000(*)
Vice President
Edward P. Kaiserian 15,800(7) 27,000 5,000(*)
Vice President
Donna J. Pedrick 1,500 6,750 1,500(*)
Director
John Ryan 10,150(8) 49,500 3,100(*)
Director
Michael D. Stern 9,619 3,750 9,619(*)
Director
Edward S. J. Tomezsko 13,850(9) 9,750 8,000(*)
Director
William L. Abbott 4,000(10) 12,300 1,000(*)
Technical Service Manager
Mark E. Carty 11,342(11) 13,227 500(*)
Advisory Consultant
Melissa A. Clancey 12,050(12) 21,450 2,000(*)
Account Executive
Arlene E. Cohen 11,025(13) 15,825 None
Senior Consultant
Michael Desiderio 5,525(14) 9,000 500(*)
Account Executive
Mary K. Fairchild 3,525(15) 9,000 None
Senior Consultant
Jerry N. Fink 4,050(16) 9,000 None
Advisory Consultant
Anthony E. Fiorito 12,975(17) 18,525 None
Advisory Consultant
Alan R. Gordon 1,950 4,800 None
Legal Counsel
</TABLE>
A-8
<PAGE>
<TABLE>
<CAPTION>
Number of Shares (and
Number of Shares Number of Shares Percentage of Outstanding
Beneficially Owned Offered for Selling Shares) Beneficially Owned
Name and Prior to this Stockholder's After Completion of this
Position with the Company Offering(1) Account(2) Offering(3)
- ------------------------- ------------------ ------------------- ---------------------------
<S> <C> <C> <C>
Brian J. Guza 1,350(18) 8,250 None
Senior Consultant
Janice M. Ingram 4,425(19) 6,900 None
Administration
Jeffrey C. Klein 5,100 12,150 None
Senior Consultant
Michael P. Laska 1,050 1,650 None
Consultant
Anthony Leitao 6,675(20) 10,575 1,500(*)
Technical Service Manager
James J. Lonsdale 13,100(21) 20,400 2,000(*)
Technical Service Manager
Amy Lutz 4,075(22) 8,250 1,000(*)
Advisory Consultant
William F. Musman 3,725(23) 7,500 500(*)
Account Executive
Jeffrey A. Orlowski 5,625(24) 8,550 None
Senior Consultant
Nakhorn Setthachayanon 2,100 3,225 None
Consultant
Lisa M. Sheehan 8,580(25) 9,975 None
Lead Consultant
Victor E. Stambaugh 19,600(26) 26,700 2,500(*)
Advisory Consultant
Mark D. West 5,525 10,350 500(*)
Senior Consultant
</TABLE>
- ---------------------------------------
(*) Denotes less than 1% of class.
(1) The number of shares of Common Stock beneficially owned by any Selling
Stockholder includes shares subject to options held by the Selling
Stockholder that are exercisable within 60 days of the date of this
Prospectus. The number of shares of Common Stock beneficially owned by
any Selling Stockholder who is not an "affiliate" of the Company does
not include any shares of Common Stock which may have been acquired by
such non-affiliate Selling Stockholder on the open market and not
readily known by the Company.
(2) Represents shares of Common Stock that may be acquired through the
exercise of options granted pursuant to the Plan, without regard to
whether such options are, or when they become, exercisable and shares
of Common Stock previously acquired pursuant to the exercise of options
and pursuant to certain stock splits and stock dividends thereon.
(3) Computed in each case by assuming that all options (without regard to
when such options become exercisable) granted to the Selling
Stockholder under the Plan have been exercised and that the Shares
acquired in connection with such exercise were disposed of by the
Selling Stockholder. For purposes of computing the percentage of the
Company's Common Stock owned by the Selling Stockholder after
completion of this offering, it is assumed that the total number of
shares of the Company's outstanding Common Stock includes such Shares
and outstanding warrants that may be exercised within 60 days of the
date of this Prospectus.
A-9
<PAGE>
(4) Includes 53,400 shares that may be acquired at or within 60 days of
June 7, 1996 pursuant to the exercise of outstanding options.
(5) Includes 54,068 shares that may be acquired at or within 60 days of
June 7, 1996 pursuant to the exercise of outstanding options and 5,000
shares of Common Stock owned by Mr. Gathman's two children, both of
whom are at majority age. Mr. Gathman disclaims beneficial ownership of
such 5,000 shares.
(6) Includes 15,000 shares that may be acquired at or within 60 days of
June 7, 1996 pursuant to the exercise of outstanding options.
(7) Includes 3,600 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(8) Includes 7,050 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(9) Includes 5,850 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(10) Includes 1,950 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(11) Includes 342 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(12) Includes 2,250 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(13) Includes 1,125 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(14) Includes 1,275 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(15) Includes 825 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(16) Includes 1,650 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(17) Includes 1,875 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options and does not
include 7,800 shares which were sold by Mr. Fiorito pursuant to Rule
144(k).
(18) Includes 300 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(19) Includes 675 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
A-10
<PAGE>
(20) Includes 1,575 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(21) Includes 1,800 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(22) Includes 1,275 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(23) Includes 825 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(24) Includes 825 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(25) Includes 3,180 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
(26) Includes 9,900 shares that may be acquired at or within 60 days of June
7, 1996 pursuant to the exercise of outstanding options.
A-11
<PAGE>
PLAN OF DISTRIBUTION
The Shares of Common Stock covered by this Prospectus are being
registered by the Company for the account of the Selling Stockholders. The
Company will pay all expenses of registering the Shares, but will not receive
any of the proceeds from sales by any of the Selling Stockholders. The Company
understands that none of such Shares will be offered through underwriters.
The Shares may be sold from time to time by the Selling Stockholders
either through one or more brokers or dealers, through privately negotiated
transactions or otherwise, at market price prevailing at the time or at prices
otherwise negotiated. In connection therewith, the Selling Stockholders and
participating brokers or dealers may be deemed to be "underwriters" within the
meaning of the Act, and commissions or discounts or any profit realized on the
sale of Shares received by a Selling Stockholder or any such broker or dealer
may be deemed to be underwriting commissions or discounts within the meaning of
the Act. As of the date of this Prospectus, the Company understands that none of
the Selling Stockholders has any agreement, arrangement or understanding with
any brokers or dealers concerning the distribution of the Shares.
DOCUMENTS INCORPORATED BY REFERENCE
Incorporated herein by reference and made a part hereof are: (1) the
description of the Company's Common Stock contained in the registration
statement filed by the Company to register such securities under Section 12 of
the Exchange Act, including any amendment or report filed for the purpose of
updating such description, and (2) the Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1996, which documents are on file with the
Commission. All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the termination of this
offering shall be deemed to be incorporated by reference in this Prospectus and
made a part hereof from the date of filing such documents.
INDEMNIFICATION
The Company's By-laws require the Company to indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed proceeding by reason of the fact that he is or was a director or
officer of the Company or is or was serving at the request of the Company as a
director, officer, employee, fiduciary or agent of another corporation, trust or
other enterprise against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Company, and, with respect to any such criminal proceeding, had no reasonable
cause to believe his conduct was unlawful. Such indemnification as to expenses
is mandatory to the extent the individual is successful on the merits of the
matter. Pennsylvania law permits the Company to provide similar indemnification
to employees and agents who are not directors or officers. The determination of
whether an individual meets the applicable standard of conduct may be made by
the disinterested directors, independent legal counsel or the stockholders.
Pennsylvania law also permits indemnification in connection with a proceeding
brought by or in the right of the Company to procure a judgment in its favor.
The Company has entered into an Indemnification Agreement with each of its
directors. Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "Act"), may be permitted to directors,
officers, or persons controlling the Company pursuant to the foregoing
provisions, the Company has been informed that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in that Act and is therefore unenforceable. The Company has obtained a
directors and officers liability insurance policy.
A-12
<PAGE>
==========================================================================
TABLE OF CONTENTS
Page
Available Information................................................. A-2
Risk Factors.......................................................... A-3
The Company........................................................... A-7
Selling Stockholders.................................................. A-7
Plan of Distribution..................................................A-12
Documents Incorporated by Reference...................................A-12
Indemnification.......................................................A-12
No person has been authorized to give any information or to make any
representations in connection with this offering other than those contained in
this Prospectus and, if given or made, such other information and
representations must not be relied upon as having been authorized by the Company
or any Underwriter. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company since the date hereof or that the
information contained herein is correct as of any time subsequent to its date.
This Prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any security other than the securities to which it relates. This
Prospectus does not constitute an offer to sell or a solicitation of an offer to
buy such securities in any state in which such offer or solicitation is
unlawful.
===========================================================================
===========================================================================
INTEGRATED SYSTEMS
CONSULTING GROUP, INC.
-------------------------------
1,299,950
Common Stock
-------------------------------
PROSPECTUS
June 7, 1996
==========================================================================
A-13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Wayne, Commonwealth of Pennsylvania, on June 7, 1996.
INTEGRATED SYSTEMS CONSULTING GROUP, INC.
By: /s/ David S. Lipson
----------------------------------
David S. Lipson
Chairman, Chief Executive Officer,
President and Treasurer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby makes, constitutes and appoints David S. Lipson and David
D. Gathman and each of them, with full power to act without the other, his true
and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities to sign any and all amendments to this Registration Statement,
including post-effective amendments, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and thing
requisite or necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or any
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ David S. Lipson Chairman, Chief Executive Officer, June 7, 1996
- ------------------- President and Treasurer
David S. Lipson (Principal Executive Officer)
/s/ David D. Gathman Chief Operating Officer, Vice President, June 7, 1996
- -------------------- Secretary, Assistant Treasurer (Principal
David D. Gathman Financial and Accounting Officer) and Director
</TABLE>
II-1
<PAGE>
<TABLE>
<S> <C> <C>
/s/ Frank Baldino, Jr,, Ph.D. Director June 7, 1996
- -----------------------------
Frank Baldino, Jr., Ph.D.
/s/ Melvyn E. Bergstein Director June 7, 1996
- -----------------------
Melvyn E. Bergstein
/s/ Donald R. Caldwell Director June 7, 1996
- ----------------------
Donald R. Caldwell
/s/ Mark J. DeNino Director June 7, 1996
- ------------------
Mark J. DeNino
Director June 7, 1996
- -----------------
James L. Mann
/s/ Donna J. Pedrick Director June 7, 1996
- --------------------
Donna J. Pedrick
/s/ John M. Ryan Director June 7, 1996
- ----------------
John M. Ryan
/s/ Michael D. Stern Director June 7, 1996
- --------------------
Michael D. Stern
Director June 7, 1996
- -------------------------------
Edward S. J. Tomezsko, Ph.D.
</TABLE>
II-2
<PAGE>
EXHIBIT INDEX
Exhibit No. Exhibit Sequential Page Number
- ----------- ------- ----------------------
5 Opinion of Saul, Ewing, Remick & Saul
23.1 Consent of KMPG Peat Marwick LLP,
independent certified public accountants
23.2 Consent of Saul, Ewing, Remick & Saul
(Contained in Exhibit No. 5)
24 Power of Attorney authorizing David S. Lipson
and David D. Gathman to sign the Registration
Statement (included in signature page of the
Registration Statement)
99.1 Amended and Restated 1989 Incentive Stock
Option Plan (incorporated herein by reference to
the Exhibit 10.1 to the Registration Statement on
Form S-1 (File No. 333-00790) declared
effective by the Securities and Exchange
Commission on April 17, 1996).
<PAGE>
EXHIBIT 5
<PAGE>
LAW OFFICES OF
SAUL, EWING, REMICK & SAUL
HARRISBURG, PENNSYLVANIA 3800 CENTRE SQUARE WEST PRINCETON, NEW JERSEY
MALVERN, PENNSYLVANIA PHILADELPHIA, PA 19102 WESTMONT, NEW JERSEY
NEW YORK, NEW YORK WILMINGTON, DELAWARE
(215) 972-7777
Fax: (215) 972-7725
Internet Email: [email protected]
World Wide Web: http://www.saul.com
June 7, 1996
Integrated Systems Consulting Group, Inc.
575 East Swedesford Road
Suite 200
Wayne, PA 19087
Gentlemen:
We refer to the Registration Statement on Form S-8 (the "Registration
Statement") of Integrated Systems Consulting Group, Inc., a Pennsylvania
corporation (the "Company"), to be filed with the Securities and Exchange
Commission covering the registration under the Securities Act of 1933, as
amended (the "Securities Act"), of 1,299,950 shares of common stock, par value
$.005 per share, of the Company (the "Shares").
We have examined the Registration Statement, the Amended and Restated
1989 Incentive Stock Option Plan, the Articles of Incorporation and By-laws of
the Company and such records, certificates and other documents as we have
considered necessary or appropriate for the purposes of this opinion.
Based on the foregoing, it is our opinion that:
1. The Company is duly organized, validly existing and presently
subsisting under the laws of the Commonwealth of Pennsylvania; and
2. The Shares to be issued in accordance with the terms described in
the Registration Statement have been duly authorized and, when issued in
accordance with the terms described in the Registration Statement, will be
validly issued, fully paid and non-assessable.
We hereby consent to use of our name in the Registration Statement as
counsel who will pass upon the legality of the Shares for the Company and as
having prepared this opinion as an exhibit to the Registration Statement. In
giving the foregoing consent, we do not thereby admit that we are in the
category of persons whose consent is required under Section 7 of the Securities
Act or the rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
SAUL, EWING, REMICK & SAUL
<PAGE>
EXHIBIT 23.1
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Integrated Systems Consulting Group, Inc.:
We consent to the use of our reports incorporated herein by reference.
KPMG PEAT MARWICK LLP
Philadelphia, Pennsylvania
June 4, 1996
