As filed with the Securities and Exchange Commission on June 30, 1999
Registration No. 333-______
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
Containing a Reoffer Prospectus on Form S-3
Industri-Matematik International Corp.
(Exact name of registrant as specified in its charter)
Delaware No. 51-0374596
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
901 Market Street
Suite 475
Wilmington, Delaware 19801
(302) 777-1608
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
----------------
Industri-Matematik International Corp. Restricted Stock Program
Industri-Matematik International Corp. 1998 Stock Option Plan
Industri-Matematik International Corp. 1997 Employee Stock Purchase Plan
(Full title of the plans)
----------------
Marvin S. Robinson, Esq.
Tannenbaum Dubin & Robinson, LLP
1140 Avenue of the Americas
New York, New York 10036
(212) 302-2900
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this registration statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [X]
CALCULATION OF REGISTRATION FEE
==============================================================================
Proposed Proposed
Maximum Maximum
Title of Each Amount Offering Aggregate Amount of
Class of Securities to be Price Per Offering Registration
to be Registered Registered Share Price Fee
- ------------------------------------------------------------------------------
Industri-Matematik International
Corp. Restricted Stock Program
Common Stock (par value $0.01) 275,000 $14.375(1) $3,953,125 $1,099
Common Stock (par value $0.01) 65,000 $6.000(1) $390,000 $ 108
- ------------------------------------------------------------------------------
Industri-Matematik International
Corp. 1998 Stock Option Plan
Common Stock (par value $0.01) 1,120,000 $2.83(2) $3,169,600 $ 881
Common Stock (par value $0.01) 1,880,000 $2.348(3) $4,414,240 $1,227
- ------------------------------------------------------------------------------
Industri-Matematik International
Corp. 1997 Employee Stock Purchase Plan
Common Stock (par value $0.01) 10,093 $4.25(1) $ 42,895 $ 12
Common Stock (par value $0.01) 589,907 $2.348(3) $1,385,102 $ 385
- ------------------------------------------------------------------------------
TOTAL: 3,940,000 $3,712
==============================================================================
(1) All such shares have been issued pursuant to the Company's Restricted
Stock Program or 1997 Employee Stock Purchase Plan at the indicated offering
price per share.
(2) Average price at which shares are issuable upon exercise of currently
outstanding options with fixed exercise prices. Pursuant to Regulation C,
Rule 457(h)(1) under the Securities Act of 1933, the aggregate offering price
and the fee have been computed upon the basis of the aggregate price at which
the options may be exercised.
(3) The price of $2.348 per share, which is the price of the Common Stock of
the registrant based upon the average of the high and low prices of the
Company's Common Stock as reported on the Nasdaq National Market on June 25,
1999, is set forth solely for purposes of calculating the filing fee pursuant
to Rule 457(c) and (h) and has been used only for those shares without a fixed
exercise price.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1933, as amended ("Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information
with the Securities and Exchange Commission ("Commission"). Such reports,
proxy statements and other information are available for inspection and
copying at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the following
regional offices of the Commission: 7 World Trade Centre, Suite 1300, New
York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60621. Copies of such material can also 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. The Common Stock of the Company
is quoted on the Nasdaq National Market and such material also may be
inspected at the offices of Nasdaq Operations, 1735 K Street, N.W.,
Washington, D.C. 20006.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon written or oral request of such person, a
copy of any and all of the information that has been incorporated by reference
in this Prospectus and any registration statement containing this Prospectus
(not including exhibits to the information that is incorporated by reference
unless such exhibits are specifically incorporated by reference in the
information that this Prospectus and any registration statement containing
this Prospectus incorporates). Such requests should be made to Marvin S.
Robinson, Tannenbaum Dubin & Robinson, LLP, 1140 Avenue of the Americas, New
York, New York 10036, (212) 302-2900.
EXPLANATORY NOTE
This Registration Statement has been prepared in accordance with the
requirements of Form S-8 which relates to the Company's Common Stock offered
pursuant to the Company's Restricted Stock Program, 1998 Stock Option Plan,
and 1997 Employee Stock Purchase Plan. This Registration Statement also
includes a Prospectus prepared in accordance with the requirements of Part I
of Form S-3 which relates to the reoffer or resale by Selling Stockholders of
certain shares of the Registrant's Common Stock covered by this Registration
Statement.
The 600,000 shares registered hereunder to be offered pursuant to the 1997
Employee Stock Purchase Plan are additional shares authorized to be issued
pursuant to that plan by the Company's Board of Directors on December 22,
1998. The 600,000 shares originally authorized under the 1997 Employee Stock
Purchase Plan were registered pursuant to Registration Statement No. 333-25407
filed on April 18, 1997.
<PAGE>
PROSPECTUS
----------
INDUSTRI-MATEMATIK INTERNATIONAL CORP.
340,000 Shares
COMMON STOCK
$.01 par value per share
This Prospectus relates to the offer and sale of 340,000 shares
("Shares") of common stock, $.01 par value per share ("Common Stock"), of
Industri-Matematik International Corp. ("Company") which may be offered hereby
from time to time by any or all of the selling stockholders named herein
("Selling Stockholders") for their own benefit. The Company will not
receive any of the proceeds from the sale of the Shares of Common Stock by the
Selling Stockholders.
The Company's Common Stock is quoted on the Nasdaq National Market under the
symbol "IMIC".
The Common Stock offered hereby involves a high degree of risk.
See "Risk Factors".
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
No person has been authorized to give any information or to make any
representation other than those contained in this Prospectus in connection
with the offering made hereby, and if given or made, such information or
representation must not be relied upon as having been authorized by the
Company or by any other person. Neither the delivery of this Prospectus nor
any sale made hereunder shall create, under any circumstances, any implication
that information herein is correct as of any time subsequent to the date
hereof. This Prospectus does not constitute an offer to sell or a
solicitation of any offer to buy any security other than the securities
covered by this Prospectus, nor does it constitute an offer to or solicitation
of any person in any jurisdiction in which such offer or solicitation may not
be lawfully made.
The date of this Prospectus is June 30, 1999
<PAGE>
THE COMPANY
The Company's principal office is located at 901 Market Street, Suite
475, Wilmington, Delaware 19801, and its telephone number is (301) 777-1608.
RISK FACTORS
This Prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended ("Securities Act"), and
Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange
Act"), that involve certain risks and uncertainties. Discussions containing
such forward-looking statements may be found in the material set forth below
as well as in this Prospectus generally, including the documents incorporated
by reference herein. Without limiting the foregoing, the words "believes,"
"anticipates," "plans," "expects," and similar expressions are intended to
identify forward-looking statements. The Company's actual results could differ
materially from those anticipated in such forward-looking statements as a
result of certain factors, including those appearing elsewhere in this
Prospectus and in the documents incorporated by reference herein. These
forward-looking statements are made as of the date of this Prospectus and the
Company assumes no obligation to update such forward-looking statements or to
update the reasons why actual results could differ materially from those
anticipated in such forward-looking statements.
In addition to the other information in this Prospectus, the following
risk factors should be considered carefully in evaluating the Company and its
business before purchasing the Common Stock offered by this Prospectus.
No Assurance of Profitability. Although the Company achieved net income of
$6.9 million and $9.4 million for its 1997 and 1998 fiscal years, respectively,
the Company had losses of $3.8 million for its fiscal quarter ended July 31,
1998, $11.0 million for its fiscal quarter ended October 31, 1998, $8.9 million
for the fiscal quarter ended January 31, 1999, and $11.6 million for its fiscal
quarter ended April 30, 1999, for a loss of $35.3 million for fiscal 1999, and
there can be no assurance that the Company will be profitable in any future
period. Future operating results will depend on many factors, including the
growth of the supply chain management software market, market acceptance of the
Company's existing and new software products or enhanced versions thereof,
competition, the success of the Company's sales, support, service, and marketing
organizations, general economic conditions, and other factors.
Significant Fluctuations in Quarterly Operating Results and Seasonality. The
Company has experienced, and expects to continue to experience, significant
fluctuations in quarterly operating results that may be caused by many factors,
including, among others: the size and timing of orders for the Company's
products; the lengthy sales and implementation cycle for the Company's products
and delays in the implementation process; introduction or enhancement of
products by the Company or its competitors; changes in pricing policy of the
Company or its competitors; increased competition; technological changes in
computer systems and environments; the ability of the Company to timely develop,
introduce, and market new products and new versions of existing products;
quality control of products sold; market readiness to deploy supply chain
management products for distributed computing environments; market acceptance of
new products and product enhancements; seasonality of revenue; customer order
deferrals in anticipation of new products and product enhancements; personnel
changes; fluctuations in foreign currency exchange rates; mix of license and
service and maintenance revenues and general economic conditions. Because a
significant portion of the Company's revenues has been, and the Company believes
will continue to be, derived from large orders, the timing of orders and their
fulfillment has caused, and is expected to continue to cause, material
fluctuations in the Company's operating results, particularly on a quarterly
basis. As a result of these and other factors, the Company believes that
period-to-period quarterly comparisons of its results of operations are not
necessarily meaningful and should not be relied upon as indications of future
performance. The Company's quarterly operating results are also subject to
certain seasonal fluctuations. The Company's revenues, particularly its license
revenues, are typically strongest in its third and fourth fiscal quarters, which
end January 31 and April 30, respectively, and weakest in its first and second
fiscal quarters, which end July 31 and October 31, respectively. The Company's
revenues and operating results in its third fiscal quarter typically benefit
from purchase decisions made by the large concentration of customers with
calendar year-end budgeting, while revenues and operating results in its fourth
fiscal quarter typically benefit from the efforts of the Company's sales force
to meet fiscal year-end sales quotas. Like many application software vendors
with large average order sizes, in its first and second fiscal quarters, the
Company's sales force initiates sales activity directed to achieving fiscal
year-end goals. In addition, the Company's first and second fiscal quarters
include the months of July and August, when both sales and billable customer
services activity, as well as customer purchase decisions, are reduced,
particularly in Europe, due to summer vacation schedules. As a result of these
seasonal factors, the Company may experience weaker performance in its first
and/or second fiscal quarters as compared to is third and/or fourth fiscal
quarters.
Unpredictability of Orders. Because the Company generally ships software
products within a short period after receipt of an order, it typically does not
have a material backlog of unfulfilled orders. License revenues in any quarter
are substantially dependent on orders booked and shipped in that quarter and
cannot be predicted with any degree of certainty. The Company has historically
recognized a significant portion of license revenue in the last two weeks of a
quarter. Any significant shortfall of license revenues in relation to the
Company's expectations or any material delay of customer orders would have an
immediate adverse effect on its business, operating results, and financial
condition. Due to the foregoing factors, it is possible that in future periods
the Company's revenues and thus its operating results may be below the
expectations of public market analysts and investors. In such event, the price
of the Company's Common Stock could be materially and adversely affected.
Lengthy Sales and Implementation Cycle. The sale and implementation of the
Company's products and particularly those related to larger orders (licenses)
generally involve a significant commitment of resources by prospective
customers. As a result, the Company's sales process often is subject to delays
associated with lengthy approval processes associated with significant capital
expenditures. For these and other reasons, the sales cycle associated with the
license of the Company's products varies substantially from customer to customer
and typically lasts between 3 and 12 months during which time the Company may
devote significant time and resources to a prospective customer, including costs
associated with multiple site visits, product demonstrations, and feasibility
studies, and experience a number of significant delays over which the Company
has no control. Any significant or ongoing failure by the Company to ultimately
achieve such sales could have a material adverse effect on the Company's
business, operating results, and financial condition. In addition, following
license sales, the software implementation typically involves customer training,
integration with the customer's other existing systems, and the development of
product extensions to add customer-specific functionality. The Company and/or a
third party consultant may provide such post delivery implementation services
pursuant to a separate services agreement. A successful implementation requires
a close working relationship between the Company, the customer, and, generally,
third party consultants who assist in the implementation process. Any inability
of the Company to achieve such close working relationships, or any inability of
the Company's consulting services organization or third party consultants to
perform implementation services on a timely basis, may result in delays in the
customer implementation process. There can be no assurance that delays in the
implementation process for any given customer will not have a material adverse
effect on the Company's business, operating results, and financial condition.
Dependence upon Relationship with Oracle. An important part of the Company's
operating results for its 1997 and 1998 fiscal years depended upon its marketing
and sales relationship with Oracle; the impact of such relationship was less
significant in fiscal 1999. For the fiscal years ended April 30, 1997, 1998,
and 1999, the Company generated 63%, 53%, and 15% of its license revenues and
35%, 39%, and 3% of its total revenues, respectively, through various joint
marketing efforts with Oracle. Prior to 1997, the Company engaged in an
informal joint marketing and sales arrangement with Oracle pursuant to which the
two companies jointly marketed to customers in the consumer packaged goods
industry. In January 1997, the Company entered into the Oracle Agreement
pursuant to which the parties agreed for a term of three years to jointly market
and license the Oracle Solution Suite, which incorporates the Company's System
ESS (R) software and certain Oracle software, and other complementary software
of third parties. Oracle pays the Company a percentage of the total license fees
that Oracle receives from a customer for System ESS. The Oracle Agreement has
been amended at various times through December, 1998, and the Oracle Agreement,
as amended, provides for additional development of component software,
integration of the software components, and marketing and support of the Oracle
Solution Suite. Pursuant to the Oracle Agreement, as amended, Oracle and its
distributors have the non-exclusive right to sub-license System ESS as part of
the Oracle Solution Suite in the consumer packaged goods industry. The Company
has the worldwide right to market System ESS to customers in the consumer
packaged goods industry as a "point" solution and in any other manner including
combining System ESS with other software, which combination can be substantially
similar to the Oracle Solution Suite. The Company and Oracle periodically enter
into separate agreements authorizing Oracle to re-license the Company's System
ESS software to customers in the consumer packaged goods industry and other
industries. Pursuant to such agreements, Oracle pays to the Company a specified
percentage of the license fee for System ESS. The Company also from time to
time directly competes with Oracle's order management software product.
In the consumer packaged goods industry, the Company actively markets and
sells System ESS as a "point" solution, as part of the Oracle Solution Suite,
and combined with software of other vendors. Accordingly, the Company's sales
of System ESS in the consumer packaged goods industry are dependent in part upon
the effectiveness of Oracle's efforts under the Oracle Agreement which the
Company cannot control. There can be no assurance that Oracle will not otherwise
curtail or discontinue the Oracle Agreement at the end of the initial three year
term, that the Company will not terminate the Oracle Agreement, or that
continuation of the Oracle Agreement will be beneficial to the Company, any of
which circumstances could have a material adverse effect on the business,
operating results, and financial condition of the Company. There can be no
assurance that Oracle will continue to recommend the Company and its products to
potential customers or enter into separate agent agreements with the Company,
either of which could have a material adverse effect on the business, operating
results, and financial condition of the Company.
Competition. The Company's products are targeted at the emerging market for
supply chain management software products which is intensely competitive and
characterized by rapid technological change. The Company's competitors are
diverse and offer a variety of solutions directed at various segments of the
supply chain as well as the enterprise as a whole. These competitors
include (i) enterprise application software vendors which offer client/server
ERP solutions, such as SAP AG, Baan Company N.V., J.D. Edwards & Company, System
Software Associates, Inc. and Oracle, (ii) companies offering standardized or
customized products on mainframe and/or mid-range computer systems, (iii)
internal development efforts by corporate information technology departments,
(iv) smaller independent companies which have developed or are attempting to
develop advanced logistics execution software which complements or competes with
the Company's software solutions, and (v) other business application software
vendors who may broaden their product offerings by internally developing, or by
acquiring or partnering with independent developers of, advanced logistics
execution software. In addition, many of the Company's competitors have longer
operating histories, significantly greater financial, technical, marketing, and
other resources, greater name recognition, and a larger installed base of
customers than the Company. In order to be successful in the future, the Company
must continue to respond promptly and effectively to the challenges of
technological change and competitors' innovations. The Company's competitors may
be able to respond more quickly to new or emerging technologies and changes in
customer requirements or devote greater resources to the development, promotion,
and sale of their products than the Company. The Company also expects to face
additional competition as other established and emerging companies enter the
market for order fulfillment software and new products and technologies are
introduced. In addition, current and potential competitors may make strategic
acquisitions or establish cooperative relationships among themselves or with
third parties, thereby increasing the ability of their products to address the
needs of the Company's prospective customers. Accordingly, it is possible that
new competitors or alliances among current and new competitors may emerge and
rapidly gain significant market share resulting in price reductions, fewer
customer orders, and reduced gross margins, any one of which could materially
adversely affect the Company's business, operating results, and financial
condition. There can be no assurance that the Company will be able to compete
successfully with existing or new competitors or that competition will not have
a material adverse effect on the Company's business, operating results, and
financial condition.
Attracting and Retaining Key Employees. The Company believes its future
success and ability to achieve revenue growth will depend in significant part
upon its ability to attract and retain highly skilled management, sales,
support, service, marketing, and product development personnel. Competition for
such personnel is intense, and recruiting such personnel is becoming
increasingly difficult because of the strong world-wide economy. In addition,
the loss of one or more of the Company's key personnel could have a material
adverse effect on the Company's business, operating results, and financial
condition. The Company does not have, and does not intend to obtain, key man
life insurance on any of its executive management personnel. There can be no
assurance that the Company will be able to retain its key employees or that it
will be successful in attracting, assimilating, and retaining such personnel in
the future. Failure to attract, assimilate, and retain key personnel could have
a material adverse effect on the Company's business, operating results, and
financial condition.
Reliance on and Need to Develop Additional Relationships with Third Parties.
The Company relies on formal and informal arrangements with a number of
consulting and systems integration firms to enhance its sales, support, service,
and marketing efforts, particularly with respect to implementation and support
of its products as well as lead generation and assistance in the sale process.
Such firms include Cap Gemini, IBM, and Oracle worldwide, Andersen Consulting,
LLP, Advanced Technologies and Services, LLC, Computer Sciences Corporation,
Ernst & Young, LLP, Palarco Inc., Solutions Consulting, Inc., and SHL
Systemhouse, Inc. and Unisys Corporation in the United States and Ceratina
Logistics OY, Computer Management Group, EcSoft, Ernst & Young, LLP, Logistics
Consultancy Norway, Logica, Medata, Ordina, Tamperen Systemitiimi, and TT Tieto
in Europe, Tietho, and ECsoft Group plc in Europe. The Company expects to
continue to rely significantly upon such third parties for marketing and sales,
lead generation, product implementation, customer support services, end user
training, and lead generation. The Company will need to expand its relationships
with these parties and enter into relationships with additional third parties in
order to support revenue growth. Many such firms have similar, and often more
established, relationships with the Company's principal competitors. There can
be no assurance that these and other third parties will provide the level and
quality of service required to meet the needs of the Company's customers, that
the Company will be able to maintain an effective, long term relationship with
such third parties, or that such third parties will continue to meet the needs
of the Company's customers. If the Company is unable to develop and maintain
effective relationships with these and other third parties, or if such parties
fail to meet the needs of the Company's customers, the Company's business,
operating results, and financial condition could be adversely affected. Further,
there can be no assurance that these third party implementation providers, many
of which have significantly greater financial, technical, personnel, and
marketing resources than the Company, will not market software products in
competition with the Company in the future or will not otherwise reduce or
discontinue their relationships with or support of the Company and its products.
Dependence on Principal Product. License and service and maintenance
revenues related to System ESS have represented a substantial portion of the
Company's revenues in recent years. System ESS and the Company's VIVALDI (TM)
suite of software encompassing System ESS components are expected to continue to
represent substantially all of the Company's revenues in the future. The
Company's success depends on continued market acceptance of System ESS software
and services and the VIVALDI suite as well as the Company's ability to introduce
new versions of System ESS or other products to meet the evolving needs of its
customers. There can be no assurance that System ESS and the VIVALDI suite will
continue to achieve market acceptance or that the Company
will introduce enhanced versions of System ESS on a timely basis, or at all, to
meet the evolving needs of its customers. Any reduction in demand for System
ESS and the VIVALDI suite, increased competition in the market for supply chain
management software, technological change, or other factors could have a
material adverse effect on the Company's business, operating results and
financial condition.
Dependence on Emerging Market for Supply Chain Management Software. The
Company currently derives, and is expected to continue to derive, a substantial
portion of its revenues from licenses and services related to System ESS, a
client/server supply chain management software product, and the VIVALDI suite.
The market for enterprise-wide management software in general, and for supply
chain management software in particular, has been limited in recent periods, and
there can be no assurance that it will stabilize or that businesses will
continue to adopt System ESS and the VIVALDI suite. The Company has spent, and
intends to continue to spend, considerable resources educating potential
customers generally about supply chain management, about the need for order
fulfillment software solutions and specifically about System ESS and the VIVALDI
suite. However, there can be no assurance that such expenditures will enable
System ESS and the VIVALDI suite to achieve any additional degree of market
acceptance. If the supply chain management software market fails to grow or
grows more slowly than the Company currently anticipates, the Company's
business, operating results, and financial condition could be materially and
adversely affected.
Rapid Technological Change and Requirement for Frequent Product Transitions.
The market for the Company's products is characterized by rapid technological
developments, evolving industry standards, and rapid changes in customer
requirements. The introduction of products embodying new technologies, the
emergence of new industry standards, or changes in customer requirements could
render the Company's existing products obsolete and unmarketable. As a result,
the Company's success depends upon its ability to continue to enhance existing
products, respond to changing customer requirements, and develop and introduce
in a timely manner new or enhanced products that keep pace with technological
developments and emerging industry standards. Customer requirements include, but
are not limited to, operability across distributed and changing heterogeneous
hardware platforms, operating systems, relational databases, and networks. The
System ESS client operates on Windows 3.1, Windows 95, and Windows NT platforms.
System ESS currently provides support for 14 languages. System ESS can
currently operate on UNIX server platforms for Hewlett-Packard Corporation, IBM,
Digital Equipment Corporation, and Sun Corporation as well as on Windows NT
server platforms. The Company continues to enhance its products to operate on
such platforms in order to meet customers' requirements. There can be no
assurances that the Company will be successful in developing enhanced versions
of System ESS and the VIVALDI suite or new products on a timely basis, or that
such enhancements or new products, when introduced, will achieve market
acceptance or will adequately address the changing needs of the marketplace. If
the Company is unable to develop and introduce new products or enhancements to
existing products in a timely manner in response to changing market conditions
or customer requirements, the Company's business, operating results, and
financial condition could be materially and adversely affected.
Litigation. In November, 1998, a licensee of System ESS (pursuant to a
license agreement with a Company partner) which is indebted to the Company for
implementation services, initiated an arbitration proceeding before the American
Arbitration Association in New York, New York seeking cancellation of its
indebtedness, a refund of prepaid support fees and the license revenue, with
such refunds trebled. In February, 1999, a class action lawsuit was commenced
against the Company, certain of its officers, directors, and controlling
shareholders who sold shares of Common Stock during the class period, and its
underwriters claiming violations of the Federal securities laws. In May, 1999,
the Company initiated an Arbitration in Denmark against a Danish licensee of
System ESS seeking damages for breach of contract. The Company anticipates that
this licensee will claim damages against the Company for breach of contract.
While management believes these actions to be without merit, an unfavorable
outcome in any of these or any other actions which may be brought against the
Company may have a material adverse affect upon the Company's business,
operating results, and financial condition.
Risk of Software Defects. Software products as complex as those offered by
the Company frequently contain errors or defects, especially when first
introduced or when new versions or enhancements are released. Despite product
testing, the Company has in the past released products with defects, discovered
software errors in certain of its new versions after introduction, and
experienced delays or lost revenue during the period required to correct these
errors. The Company regularly introduces new releases and periodically
introduces new products. There can be no assurance that, despite testing by the
Company and by its customers, defects and errors will not be found in existing
products or in new products, releases, versions, or enhancements after
commencement of commercial shipments. Any such defects and errors could result
in adverse customer reactions, negative publicity regarding the Company and its
products, harm to the Company's reputation, loss of or delay in market
acceptance, or require product changes, any of which could have a material
adverse effect upon the Company's business, operating results, and financial
condition.
Product Liability. The Company's license agreements with customers typically
contain provisions designed to limit the Company's exposure to potential product
liability claims. The limitation of liability provisions contained in such
license agreements may not be effective. The Company's products are generally
used to manage data critical to large organizations and, as a result, the sale
and support of products by the Company may entail the risk of product liability
claims. A successful liability claim brought against the Company could have a
material adverse effect upon the Company's business, operating results, and
financial condition.
Dependence on Proprietary Technology; Risks of Infringement. The Company's
success depends, in part, upon the protection of its proprietary technology. The
Company relies on a combination of copyright, trademark, and trade secret laws,
confidentiality procedures, and license arrangements to establish and protect
its proprietary rights. As part of its confidentiality procedures, the Company
licenses its software pursuant to signed license agreements that impose
restrictions on the licensee's ability to utilize the software and generally
enters into non-disclosure agreements with its employees, distributors, and
partners, and limits access to and distribution of its software, documentation,
and other proprietary information. Despite these precautions, it may be possible
for a third party to copy the Company's products or otherwise obtain and use the
Company's proprietary technology without authorization. In addition, the laws of
certain countries do not protect the Company's proprietary rights to the same
extent as do the laws of the United States or Sweden. Accordingly, third parties
may copy or otherwise obtain and use the Company's proprietary technology
without authorization. There can be no assurance that the Company's protection
of its proprietary rights will be adequate or that the Company's competitors
will not independently develop similar technology or duplicate illegally the
Company's products.
The Company is not aware that any of its products infringe the proprietary
rights of third parties. There can be no assurance, however, that third parties
will not claim such infringement by the Company with respect to current or
future products. The Company expects that software product developers
increasingly will be subject to such claims as the number of products and
competitors in the Company's industry segment grows and the functionality of
products in the industry segment overlap. Any such claims, with or without
merit, could result in costly litigation that could absorb significant
management time, which could have a material adverse effect on the Company's
business, operating results, and financial condition. Such claims might require
the Company to enter into royalty or license agreements. Such royalty or license
agreements, if required, may not be available on terms acceptable to the Company
or at all, which could have a material adverse effect upon the Company's
business, operating results, and financial condition.
Exposure to Currency Fluctuations. A significant portion of the Company's
business is conducted in currencies other than the U.S. dollar (the currency in
which its financial statements are stated), primarily the Swedish krona and, to
a lesser extent, the U.K. pound sterling, the German mark, the Dutch guilder,
the French franc, the Australian dollar, and the Canadian dollar. The Company
incurs a significant portion of its expenses in Swedish krona, including all of
its product development expenses and a substantial portion of its general and
administrative expenses. As a result, appreciation of the value of the Swedish
krona relative to the other currencies in which the Company generates revenues,
particularly the U.S. dollar, could adversely affect operating results. The
financial statements of the Company are translated from the functional currency
of the operating subsidiaries into U.S. dollars, the Company's reporting
currency, utilizing the current rate method. Accordingly, assets and liabilities
are translated at exchange rates in effect at the end of the reporting period,
and revenues and expenses are translated at the average exchange rate during the
period. All translation gains or losses from the translation into the Company's
reporting currency are included as a separate component of stockholders' equity.
Fluctuations in the Swedish krona and other currencies relative to the U.S.
dollar will effect period to period comparison of the Company's reported results
of operations. Due to constantly changing currency exposures and the volatility
of currency exchange rates, there can be no assurance that the Company will not
experience currency losses in the future, nor can the Company predict the effect
of exchange rate fluctuations upon future operating results. The Company does
not currently undertake hedging transactions to cover its currency exposure, but
the Company may choose to hedge a portion of its currency exposure in the future
as it deems appropriate.
Possible Volatility of Stock Price. The market price for the Common Stock
has in the past been, and in the future could be, subject to significant
fluctuations in response to a number of factors, including the announcement of
new products or product enhancements by the Company or its competitors,
quarterly variations in the Company's results of operations, or results of
operations of its competitors or companies in related industries, changes in
earnings or revenue estimates, or recommendations by securities analysts,
developments in the Company's industry, general market conditions, and other
factors, including factors unrelated to the operating performance of the Company
or its competitors. In addition, stock prices for many companies in the
technology and emerging growth sectors have experienced wide fluctuations
that have often been unrelated to the operating performance of such companies.
Such factors and fluctuations, as well as general economic, political, and
market conditions, such as recessions, could materially and adversely affect the
market price of the Company's Common Stock.
Control by Management and Current Stockholders; Indemnification of Officers
and Directors. The Company's executive officers and directors and their
affiliates, in the aggregate, own beneficially 52.1% of the Company's
outstanding Common Stock as of April 30, 1999. In particular, Warburg, Pincus
Investors, L.P. ("Warburg") owns beneficially 38.1% of the Company's outstanding
Common Stock as of such date. As a result, Warburg can exercise significant
influence over all matters requiring stockholder approval, including the
election of directors and approval of significant corporate transactions. The
voting power of Warburg and the Company's officers and directors under certain
circumstances could have the effect of delaying, deferring, or preventing a
change in control of the Company, and making certain transactions more difficult
or impossible absent the support of such stockholders, including proxy contests,
mergers involving the Company, tender offers, open-market purchase programs, or
other purchases of Common Stock that could give stockholders of the Company the
opportunity to realize a premium over the then prevailing market price for
shares of Common Stock. The Company has entered into agreements with its
officers and directors indemnifying them against losses they may incur in legal
proceedings arising from their service to the Company.
Effect of Certain Charter Provisions; Antitakeover Effects of the Company's
Charter, By-laws, and Delaware Law. The Company's Board of Directors has the
authority to issue up to 15,000,000 shares of Preferred Stock and to determine
the price, preferences, privileges, and restrictions, including voting rights,
of those shares without any further vote or action by the stockholders. The
rights of the holders of 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 could have the effect of making
it more difficult for a third party to acquire a majority of the outstanding
voting stock of the Company. In addition, the Company is subject to the
antitakeover provisions of Section 203 of the Delaware General Corporation Law,
which prohibits the Company from engaging in a "business combination" with an
"interested stockholder" for a period of three years after the date of the
transaction in which the person became an interested stockholder, unless the
business combination is approved in a prescribed manner. The application of
Section 203 also could have the effect of delaying, deferring, or preventing a
change of control of the Company. Further, certain provisions of the Company's
Certificate of Incorporation and By-laws may have the effect of discouraging,
delaying, or preventing a merger, tender offer, or proxy contest involving the
Company, which could adversely affect the market price of the Company's Common
Stock.
Registration Rights. A total of 15,349,769 shares of Common Stock held by
certain stockholders are entitled to certain registration rights. If such
stockholders, by exercising their registration rights, cause a large number of
shares to be registered and sold in the public market, the sale of such shares
could have a material adverse effect on the market price for the Company's
Common Stock and could materially adversely effect the Company's ability to
raise additional capital when or if required.
Enforceability of U.S. Judgments against Non-U.S. Officers and Directors. A
substantial portion of the Company's assets are located outside the United
States. In addition, members of the Board of Directors of the Company and
certain experts named herein are residents of countries other than the United
States. As a result, it may not be possible for investors to effect service of
process within the United States upon such persons or to enforce against such
persons judgments of courts of the United States predicated upon civil
liabilities under the United States Federal securities laws. There can be no
assurance that United States investors will be able to enforce against the
members of the Board of Directors or certain experts named herein who are
residents of Sweden or countries other than the United States, any judgments in
civil and commercial matters, including judgments under the federal
securities laws. In addition, there is doubt as to whether a Swedish court would
impose civil liability on the members of the Board of Directors of the Company
in an original action predicated solely upon the Federal securities laws of the
United States brought in a court of competent jurisdiction in Sweden against the
Company or such members.
Holding Company Structure. All of the operations of the Company are and will
be conducted through direct and indirect subsidiaries. The Company's cash flow
will depend upon the operating results and cash flow of its subsidiaries and the
payment of funds by those subsidiaries to the Company in the form of loans,
dividends, or otherwise. The subsidiaries are separate and distinct legal
entities and have no obligation, contingent or otherwise, to make funds
available to the Company, whether in the form of loans, dividends, or otherwise.
Applicable law in certain countries may limit the ability of a subsidiary to pay
dividends in the absence of sufficient distributable reserves or for other
reasons. The Company's Swedish, United Kingdom, German, Dutch, French, United
States, Australian, and Canadian subsidiaries are not subject to any current
exchange controls. However, future exchange controls in these counties, or the
existence of such controls in other countries in which the Company establishes
subsidiaries, could limit or restrict the ability of the Company to obtain
loans, dividends, or otherwise access financial resources in such subsidiaries.
In addition, the Company's subsidiaries may from time to time in the future
become parties to financing arrangements which may contain limitations on the
ability of such subsidiaries to pay dividends or to make loans or advances to
the Company. In the event of any insolvency, bankruptcy, or similar proceedings,
creditors of the subsidiaries would generally be entitled to priority over the
stockholders of the Company with respect to assets of the affected subsidiary.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares of Common Stock by the Selling Stockholders.
THE SELLING STOCKHOLDERS
This Prospectus relates to possible sales by stockholders of the Company of
Shares issued pursuant to the Company's Restricted Stock Program. The following
table shows the names of the Selling Stockholders, the number of outstanding
Shares of Common Stock of the Company beneficially owned by each of them as of
June 29, 1999, and the number of Shares available for resale hereunder, subject
to terms of the Company's Restricted Stock Program. Because the Selling
Stockholders may sell all or part of their Shares pursuant to this Prospectus,
no estimate can be given as to the amount of Shares that will be held by each
Selling Stockholder upon termination of this offering.
SELLING STOCKHOLDER TABLE
Number of Number of
Shares Shares Available
Beneficially For Sale
Name Owned Percent Hereunder
- ------ ------------ ------- ----------------
Durlow, Stig ...................... 630,000 1.9% 165,000
Peterson, Lars-Goran .............. 232,000 * 100,000
Lillienberg, Mats ................. 180,000 * 50,000
Ekholtz, Per-Olof ................. 49,995 * 25,000
- -----------
* Less than 1%.
PLAN OF DISTRIBUTION
The Shares offered hereby are being sold by the Selling Stockholders for
their own account. The Company will not receive any of the proceeds from this
offering.
It is anticipated that the Selling Stockholders may from time to time make
sales of all or part of the Shares of Common Stock covered by this Prospectus in
the over-the-counter market, by block trading, in negotiated transactions or
otherwise at prices then prevailing or in private transactions at negotiated
prices. In addition to sales under this Prospectus, the Selling Stockholders
may also effect sales of Shares of Common Stock covered by this Prospectus
pursuant to Rule 144 promulgated under the Act. All the foregoing transactions
will be made without payment of any underwriting commissions or discounts, other
than the customary brokers' fees normally paid in connection with such
transactions. The Selling Stockholders will have the right to withdraw the
offered Shares prior to sale. There is no present plan of distribution.
LEGAL MATTERS
The validity of the issuance of the Shares offered hereby will be passed
upon by Tannenbaum Dubin & Robinson, LLP, New York, New York. As of June 25,
1999, Marvin S. Robinson, the Secretary of the Company and a member of
Tannenbaum Dubin & Robinson, LLP, and Lincoln W. Briggs, Alan I. Brown, and
Mitchell S. Iden, all members of Tannenbaum Dubin & Robinson, LLP, owned in the
aggregate 14,450 shares of the Company's Common Stock having a market value on
such date of $33,929.
EXPERTS
The financial statements of the Company included in the Company's Annual
Report on Form 10-K for the fiscal year ended April 30, 1998, are incorporated
herein by reference, and audited financial statements to be included in
subsequently filed documents will be incorporated herein, in reliance on the
report of Ohrlings Coopers & Lybrand AB, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed with the Commission are incorporated by
reference in this Prospectus:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
April 30, 1998;
(b) The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended July 31, 1998, October 31, 1998, and January 31, 1999;
(c) The description of securities to be registered contained in the
Company's Registration Statement on Form 8-A, filed on September 13, 1996; and
(d) All documents subsequently filed with the Commission by Securities the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act of
1934, as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered herein have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the date
of filing of such documents.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
(a) Section 145 of the GCL gives Delaware corporations the power to indemnify
each of their present and former officers or directors under certain
circumstances, if such person acted in good faith and in a manner which he
reasonably believed to be in, or not opposed to, the best interest of the
corporation.
(b) The Amended and Restated Certificate of Incorporation of the Company
contains provisions that eliminate the personal liability of each director to
the Company or its stockholders for monetary damages for breach of fiduciary
duty as a director, except (i) for breaches of such director's duty of loyalty
to the Company or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the GCL or (iv) for any transaction from which such
director derived an improper personal benefit.
(c) The Amended and Restated Certificate of Incorporation of the Company
contains provisions to the general effect that each director and officer shall
be indemnified by the Company against liabilities and expenses in connection
with any threatened, pending or contemplated legal proceedings to which he may
be made a party or with which he may become involved by reason of being or
having been an officer or director of the Company or of any other organization
at the request of the Company. Indemnification is available only if it is
determined to be proper by the majority of disinterested directors constituting
a quorum, by the stockholders, or by independent legal counsel in a written
option. In order to be entitled to indemnification, the indemnified person must
have 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 criminal
action or proceedings, had no reasonable cause to believe his conduct was
unlawful. In the case of an action by or in the right of the Company,
indemnification is precluded if such person has been adjudged to be liable,
unless and only to the extent that the Court of Chancery of the State of
Delaware or the court in which the action was brought shall determine that
indemnification is proper. The Company also has the power to obtain insurance
indemnifying officers and directors of the Company against any liability which
it may deem proper, whether or not the Company would otherwise have the power to
indemnify such officer or director pursuant to its Amended and Restated
Certificate of Incorporation.
The Company maintains, on behalf of its directors and officers, insurance
protection against certain liabilities arising out of the discharge of their
duties and also insurance covering the Company against indemnification payments
to its directors and officers for certain liabilities.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Company of expenses incurred or paid
by a director, officer or controlling person of the Company 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
Company 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.
================================================================================
No dealer, salesperson or any other person has been authorized to give any
information or to make any representations not contained in this Prospectus and,
if given or made, such information or representations must not be relied upon as
having been authorized by the Company or the Selling Stockholders. This
Prospectus does not constitute an offer to sell, or solicitation of an offer to
sell, any securities other than the registered securities to which it relates,
or an offer to or solicitation of any person in any jurisdiction where such an
offer or solicitation would be unlawful. Neither the delivery of this
Prospectus nor any sale made hereunder shall, under any circumstances, create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.
-------------------
TABLE OF CONTENTS
Page
----
Available Information....................................... __
The Company................................................. __
Risk Factors................................................ __
Use of Proceeds............................................. __
The Selling Stockholders.................................... __
Plan of Distribution........................................ __
Legal Matters............................................... __
Experts..................................................... __
Incorporation of Certain Information by Reference........... __
Indemnification of Directors and Officers................... __
-------------------
================================================================================
340,000 Shares
INDUSTRI-MATEMATIK
INTERNATIONAL CORP.
Common Stock
----------
PROSPECTUS
----------
June 30, 1999
================================================================================
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information
The documents containing the information specified in this Item 1 will be
sent or given to employees, directors or others as specified by Rule 428(b)(1).
In accordance with the rules and regulations of the Commission and the
instructions to Form S-8, such documents are not being filed with the Commission
either as part of this Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424.
Item 2. Registrant Information and Employee Plan Annual Information
The documents containing the information specified in this Item 2 will be
sent or given to employees as specified by Rule 428(b)(1). In accordance with
the rules and regulations of the Commission and the instructions to Form S-8,
such documents are not being filed with the Commission either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed with the Commission are incorporated by
reference in this Registration Statement:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
April 30, 1998;
(b) The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended July 31, 1998, October 31, 1998, and January 31, 1999;
(c) The description of securities to be registered contained in the
Company's Registration Statement on Form 8-A, filed on September 13, 1996; and
(d) All documents subsequently filed with the Commission by Securities the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act of
1934, as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered herein have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the date
of filing of such documents.
Item 4. Description of Securities
Counsel to the Company, Tannenbaum Dubin & Robinson, LLP, 1140 Avenue of
the Americas, New York, New York 10036, has rendered an opinion to the effect
that the Common Stock offered hereby issued in accordance with the Company's
Restricted Stock Program, is, and when issued in accordance with the Company's
1998 Stock Option Plan, will be, legally and validly issued, fully paid, and
non-assessable. As of June 25, 1999, Marvin S. Robinson, the Secretary of the
Company, and Alan I. Brown, Mitchell S. Iden, and Lincoln W. Briggs, all members
of Tannenbaum Dubin & Robinson, LLP, owned in the aggregate 14,450 shares of the
Company's Common Stock having a market value, as of such date, of $33,929.
Item 5. Interest of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
(a) Section 145 of the GCL gives Delaware corporations the power to indemnify
each of their present and former officers or directors under certain
circumstances, if such person acted in good faith and in a manner which he
reasonably believed to be in, or not opposed to, the best interest of the
corporation.
(b) The Amended and Restated Certificate of Incorporation of the Company
contains provisions that eliminate the personal liability of each director to
the Company or its stockholders for monetary damages for breach of fiduciary
duty as a director, except (i) for breaches of such director's duty of loyalty
to the Company or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the GCL or (iv) for any transaction from which such
director derived an improper personal benefit.
(c) The Amended and Restated Certificate of Incorporation of the Company
contains provisions to the general effect that each director and officer shall
be indemnified by the Company against liabilities and expenses in connection
with any threatened, pending or contemplated legal proceedings to which he may
be made a party or with which he may become involved by reason of being or
having been an officer or director of the Company or of any other organization
at the request of the Company. Indemnification is available only if it is
determined to be proper by the majority of disinterested directors constituting
a quorum, by the stockholders, or by independent legal counsel in a written
option. In order to be entitled to indemnification, the indemnified person must
have 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 criminal
action or proceedings, had no reasonable cause to believe his conduct was
unlawful. In the case of an action by or in the right of the Company,
indemnification is precluded if such person has been adjudged to be liable,
unless and only to the extent that the Court of Chancery of the State of
Delaware or the court in which the action was brought shall determine that
indemnification is proper. The Company also has the power to obtain insurance
indemnifying officers and directors of the Company against any liability which
it may deem proper, whether or not the Company would otherwise have the power to
indemnify such officer or director pursuant to its Amended and Restated
Certificate of Incorporation.
The Company maintains, on behalf of its directors and officers, insurance
protection against certain liabilities arising out of the discharge of their
duties and also insurance covering the Company against indemnification payments
to its directors and officers for certain liabilities.
Item 7. Exemption From Registration Claimed
The sales and issuances of the securities to be reoffered or resold
pursuant to this Registration Statement were offered and sold in reliance upon
the exemption from registration under Section 4(2) of the Securities Act.
Item 8. Exhibits
Exhibit No. Description of Exhibit
----------------- ---------------------------------------------------
Exhibit 4.1 Form of Amended and Restated Certificate of
Incorporation of the Registrant (filed as Exhibit
3.2 to the Registrant's Registration Statement on
Form S-1, File No. 333-5495, and incorporated
herein by reference).
Exhibit 4.2 Form of Restated By-Laws of the Registrant (filed
as Exhibit 3.4 to the Registrant's Registration
Statement on Form S-1, File No. 333-5495, and
incorporated herein by reference).
Exhibit 4.3 Specimen certificate representing the Common Stock
of the Registrant (filed as Exhibit 4.1 to the
Registrant's Registration Statement on Form S-1,
File No. 333-5495, and incorporated herein by
reference).
Exhibit 4.4 Industri-Matematik International Corp. 1998 Stock
Option Plan
Exhibit 4.5 Industri-Matematik International Corp. 1997
Employee Stock Purchase Plan, as amended
Exhibit 4.6 Form of Agreements of Restricted Stock Program of
the Registrant (filed as Exhibit 10.4 to the
Registrant's Registration Statement on Form S-1,
File No. 333-5495 and incorporated herein by
reference).
Exhibit 5.1 Opinion of Tannenbaum Dubin & Robinson, LLP
Exhibit 23.1 Consent of Tannenbaum Dubin & Robinson, LLP
(contained in Exhibit 5.1).
Exhibit 23.2 Consent of Ohrlings Coopers & Lybrand AB.
Exhibit 24.1 Power of Attorney (included as part of the
signature page to this Registration Statement).
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;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference 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 Company hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the Company's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
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
herein, 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 Company pursuant to the foregoing provisions, or
otherwise, the Company has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of
expenses incurred or paid by a director, officer or controlling person
of the Company 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 Company
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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company,
Industri-Matematik International Corp., 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, on this 29th day of June, 1999.
INDUSTRI-MATEMATIK INTERNATIONAL CORP.
By: /s/ STIG G. DURLOW
----------------------------------
Stig G. Durlow
Chairman, President and
Chief Executive Officer
<PAGE>
<PAGE>
POWER OF ATTORNEY
We, the undersigned officers and directors of Industri-Matematik
International Corp., hereby severally continue and appoint Stig G. Durlow,
Lars-Goran Peterson, and Marvin S. Robinson and each of them singly, our true
and lawful attorneys, with full power to them and each of them singly, to sign
for us in our names in the capacities indicated below, any amendments to this
Registration Statement on Form S-8 (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, and generally to do all
things in our names and on our behalf in our capacities as officers and
directors to enable Industri-Matematik International Corp. to comply with the
provisions of the Securities Act of 1933, as amended, hereby ratifying and
confirming our signatures as they may be signed by our said attorneys, or any of
them, to said Registration Statement and all amendments thereto.
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.
Signature Title Date
- ---------- ----- ----
/s/ STIG G. DURLOW Chairman of the Board of June 29, 1999
- --------------------------- Directors, President and Chief
Stig. G. Durlow Executive Officer (Principal
Executive Officer)
/s/ JEFFREY A. HARRIS Director June 29, 1999
- -----------------------
Jeffrey A. Harris
/s/ WILLIAM H. JANEWAY Director June 29, 1999
- -----------------------
William H. Janeway
/s/ MARTIN LEIMDORFER Director June 29, 1999
- -----------------------
Martin Leimdorfer
/s/ KARL ASP Treasurer and Chief Financial June 29, 1999
- ----------------------- Officer (Principal Financial
Karl Asp and Accounting Officer)
/s/ GEOFFREY W. SQUIRE Director June 29, 1999
- -----------------------
Geoffrey W. Squire
<PAGE>
Exhibit Index
-------------
Sequential
Exhibit Numbered
Number Description Page
- - ------- ----------- ----
4.1 Form of Amended and Restated
Certificate of Incorporation of the
Registrant (filed as Exhibit 3.2 to the
Registrant's Registration Statement on
Form S-1, File No. 333-5495, and
incorporated herein by reference).
4.2 Form of Restated By-Laws of the
Registrant (filed as Exhibit 3.4 to the
Registrant's Registration Statement on
Form S-1, File No. 333-5495, and
incorporated herein by reference)
4.3 Specimen certificate representing the
Common Stock of the Registrant (filed
as Exhibit 4.1 to the Registrant's
Registration Statement on Form S-1,
File No. 333-5495, and incorporated
herein by reference).
4.4 Industri-Matematik International
Corp. 1998 Stock Option Plan.
4.5 Industri-Matematik International Corp.
1997 Employee Stock Purchase Plan, as amended
4.6 Form of Agreements of Restricted Stock
Program of the Registrant (filed as
Exhibit 10.4 to the Registrant's
Registration Statement on Form S-1,
File No. 333-5495 and incorporated
herein by reference).
5.1 Opinion of Tannenbaum Dubin &
Robinson, LLP
23.1 Consent of Tannenbaum Dubin &
Robinson, LLP(contained in Exhibit
5.1).
23.2 Consent of Ohrlings Coopers & Lybrand AB
24.1 Power of Attorney (included as part of
the signature page to this Registration
Statement).
EXHIBIT 4.4
INDUSTRI-MATEMATIK INTERNATIONAL CORP.
1998 STOCK OPTION PLAN
SECTION I
PURPOSE
The purpose of the Industri-Matematik International Corp. 1998 Stock Option
Plan is to provide favorable opportunities for (a) certain selected employees
and (b) certain selected non-employee members of the Board of Directors,
consultants, and other advisors of Industri-Matematik International Corp. and
its subsidiaries to purchase shares of Industri-Matematik International Corp.
Common Stock in order to attract and retain individuals of exceptional skill and
to provide an increased incentive for these individuals to contribute to the
future success and prosperity of Industri-Matematik International Corp., thereby
enhancing the value of the Common Stock for the benefit of shareholders.
SECTION II
DEFINITIONS AND CONSTRUCTION
2.1. Terms used in this Stock Option Plan shall be defined as follows:
Board shall mean the Board of Directors of IMIC.
Cause shall mean, with respect to a non-employee Optionee, (a) the breach by
the Optionee of any agreement between the Company and the Optionee, (b) willful
and gross misconduct on the part of the Optionee that is materially and
demonstrably detrimental to the Company, or (c) the commission by the Optionee
of one or more acts which constitute an indictable crime under Federal, state,
or local law, each as may be determined in good faith by written resolution
adopted by a majority of the members of the Board at a meeting duly called and
held for that purpose after reasonable notice to the Optionee and opportunity
for the Optionee and his or her counsel to be heard.
Change of Control shall mean: (a) Continuing Directors no longer constitute at
least a majority of the Board; (b) any person or group of persons (as defined in
Rule 13d-5 under the Exchange Act) through transactions not approved by the
Continuing Directors who constitute a majority of the Board, become the
beneficial owner, directly or indirectly, after the Effective Date of 40% or
more of IMIC's then outstanding Common Stock (including Common Stock owned by
such person or group of persons prior to the Effective Date); (c) the approval
by IMIC's shareholders of the merger or consolidation of IMIC with any other
corporation, the sale of substantially all of the assets of IMIC, or the
liquidation or dissolution of IMIC unless, in the case of a merger or
consolidation, the Continuing Directors in office immediately prior to such
merger or consolidation will constitute at least a majority of directors of the
surviving corporation of such merger or consolidation and any parent (as such
terms is defined in Rule 12b-2 under the Exchange Act) of such corporation, and
such surviving corporation (and such parent, if any) shall have at least five
directors; or (d) at least a majority, all of whom shall be Continuing
Directors, of the directors in office immediately prior to any other action
proposed to be taken by IMIC's shareholders or by the Board determines that such
proposed action, if taken, would constitute a change of control of IMIC and such
proposed action is thereafter taken.
Change of Control Exercise Period shall mean the period during which a Limited
Right may be exercised in accordance with Section 8.2.
Change of Control Price shall mean the higher of (i) the highest price per
share of Common Stock paid or offered in any transaction related to a Change of
Control of IMIC or (ii) the highest Fair Market Value per share of Common Stock
at any time during the 60-day period preceding a Change of Control.
Code shall mean the Internal Revenue Code of 1986, as amended from time to
time.
Committee shall mean the Compensation Committee appointed by the Board to
administer the Plan which shall be composed of at least two persons.
Common Stock shall mean the Common Stock, $.01 par value, of IMIC.
Company shall mean Industri-Matematik International Corp. and its
Subsidiaries.
Continuing Director shall mean any individual who is a member of the Board on
August 19, 1998, or is designated (before such person's initial election as a
director) as a Continuing Director by a majority of the then Continuing
Directors.
Disability shall mean disability within the meaning of Section 22(e)(3) of the
Code, as determined by the Committee.
Effective Date shall mean August 19, 1998.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended from
time to time.
Exercise Price shall mean the price of a share of Common Stock payable by the
Optionee on exercise of an Option.
Fair Market Value on a specified day shall mean, if the Common Stock is
publicly traded, the reported closing price on that day, or if there was no sale
of Common Stock reported on that day, then the reported closing price on the
next preceding day on which there was such a sale, but if the Common Stock is
not publicly traded, the Committee shall make a good faith determination of Fair
Market Value.
IMIC shall mean Industri-Matematik International Corp.
ISO shall mean an incentive stock option within the meaning of Section 422 of
the Code.
Limited Right shall mean the right pursuant to an award granted under Section
8.1 to surrender to IMIC all or a portion of an Option in accordance with
Section 8.2.
Non-ISO shall mean a stock option which is not an ISO.
Option shall mean a stock option granted under the Plan.
Optionee shall mean an individual who has been granted one or more Options.
Parent Corporation shall mean a parent corporation as defined in Section
424(e) of the Code.
Plan shall mean this Industri-Matematik International Corp. 1998 Stock Option
Plan.
Retirement shall mean retirement on or after age 65 or, with the advance
consent of the Committee, at an earlier age.
Securities Act shall mean the Securities Act of 1933, as amended from time to
time.
Stock Appreciation Right shall mean a right to receive cash or Common Stock
upon the exercise of an Option in accordance with Section 6.7.
Subsidiary shall mean a subsidiary corporation as defined in Section 424(f) of
the Code.
Termination Date shall mean the last day on which an Option may be exercised,
which date shall be fixed by the Committee but which shall not be later than the
day preceding the tenth anniversary of the date on which the Option is granted.
Termination for Cause shall mean, with respect to an employee Optionee, a
termination by the Company of his employment (a) based upon the Company's
determination that (i) the Optionee has breached any agreement between the
Company and the Optionee, (ii) the Optionee has willfully acted in a manner that
is materially and demonstrably detrimental to the Company, (iii) the Optionee
has materially failed to perform the duties or carry out the responsibilities
assigned to him, or (iv) the Optionee committed one or more acts which
constitute an indictable crime under Federal, state, or local law, or (b) for
any other reason that the Company considers to be cause.
2.2. When used in this Plan, unless the context clearly indicates to the
contrary, (a) the masculine gender shall include the feminine and neuter
genders, (b) the feminine gender shall include the masculine and neuter genders,
(c) the neuter gender shall include the masculine and feminine genders, (d) the
singular shall include the plural, and (e) if a defined term is intended, it
shall be capitalized.
SECTION III
ADMINISTRATION
3.1. Except as otherwise provided in the Plan, and subject to the provisions
of Section 3.2, the Committee shall administer the Plan and shall have full
power to grant Options, construe and interpret the Plan, establish and amend
rules and regulations for its administration, and perform all other acts
relating to the Plan including the delegation of administrative responsibilities
which it believes reasonable and proper.
3.2. Subject to the provisions of the Plan and/or a specific direction from
the Board, the Committee shall establish the policies and criteria pursuant to
which it shall grant Options and administer the Plan and, in its discretion,
shall determine which employees of the Company and/or members of the Board,
consultants, or other advisors shall be granted Options, the number of shares
covered by such Options, and the terms and conditions of the Options. If
authorized by the Board, the Committee may delegate to an individual member of
the Committee or an officer of the Company the discretion to determine, in
accordance with guidelines established by the Board, which employees of the
Company and/or members of the Board, consultants, or other advisors shall be
granted options, the number of shares covered by any such Options, and the terms
and conditions of the Options.
3.3. The Committee may at any time, with the consent of the Optionee, in its
sole discretion cancel any Option and issue to the Optionee a new Option for an
equivalent or lesser number of shares of Common Stock and at a lower Exercise
Price. The total number of shares of Common Stock which may be available for
grants of new Options pursuant to this Section 3.3 during the term of the Plan
shall be 300,000, subject to adjustment in accordance with Section IX.
3.4. Any decision made, or action taken, by the Committee or the Board
arising out of or in connection with the interpretation and administration of
the Plan shall be final and conclusive.
SECTION IV
SHARES SUBJECT TO THE PLAN
4.1. The total number of shares of Common Stock available for grants of
Options under the Plan shall be 3,000,000, subject to adjustment in accordance
with Section IX. These shares may be either authorized and unissued or
reacquired shares of Common Stock. If an Option or portion thereof shall expire
or terminate for any reason without having been exercised in full, the
unpurchased shares covered by such Option shall be available for future grants
of Options. An Option or portion thereof exercised through the exercise of a
Stock Appreciation Right pursuant to Section 6.7 or related to a Limited Right
exercised pursuant to Section VIII shall be treated, for the purposes of this
Section IV, as though the Option or portion thereof had been exercised through
the purchase of Common Stock with the result that the shares of Common Stock
subject to the Option or portion thereof that was so exercised shall not be
available for future grants of Options.
SECTION V
ELIGIBILITY
5.1. Options may be granted to employees of the Company or to persons who
have been engaged to become employees of the Company. Such Optionees will
comprise, in general, employees who contribute or who are expected to contribute
to the management, direction, and overall success of the Company.
5.2. Options also may be granted to members of the Board, consultants, and
other advisors who are not employees of the Company. Such Optionees will
comprise, in general, those who, while not employees of the Company, have an
ongoing relationship with the Company and make or who are expected to make
significant contributions to the overall success of the Company.
SECTION VI
TERMS OF OPTIONS
6.1.a. All Options shall be evidenced by written agreements executed by the
Company and the Optionee. Such Options shall be subject to the applicable
provisions of the Plan and shall contain such provisions as are required by the
Plan and any other provisions the Committee may prescribe. All agreements
evidencing Options shall specify the total number of shares subject to each
grant, the Exercise Price, and the Termination Date. Those Options that comply
with the requirements for an ISO set forth in Section 422 of the Code and that
the Committee wishes to designate as an ISO shall be ISOs, and all other Options
(including any Option that would otherwise qualify as an ISO but which the
Committee designates as an Non-ISO) shall be Non-ISOs. Only Non-ISOs shall be
granted to any Optionee who is not an employee of the Company on the date the
Option is granted.
6.1.b. The written agreement referred to in Section 6.1.a also shall provide
that unless the shares of Common Stock acquired on the exercise of the Option
are then currently registered under the Securities Act, if counsel to IMIC
advises that the same is required, prior to delivery of the shares acquired upon
the exercise of the Option the Optionee shall agree to hold such shares for
investment only and not with a view to resale or distribution thereof to the
public, and such Optionee shall deliver to IMIC a letter to that effect in a
form specified by counsel to IMIC together with any additional documents
specified by counsel. In the event that issuance of shares of Common Stock on
exercise of the Option is subject to laws, rules, and/or regulations of a
jurisdiction other than the United States of America, the Optionee
simultaneously shall comply with the requirements of counsel to IMIC to satisfy
the same.
6.2. The Exercise Price for an ISO or a non-ISO shall not be less than the
Fair Market Value of a share of Common Stock on the date the Option is granted.
6.3.a. The Committee shall determine the dates after which Options may be
exercised in whole or in part. If Options are exercisable in installments,
installments or portions thereof that are exercisable and not exercised shall
accumulate and remain exercisable. The Committee also may amend an Option to
accelerate the dates after which Options may be exercised in whole or in part.
However, no Option or portion thereof shall be exercisable after the Termination
Date.
6.3.b. Notwithstanding any contrary provisions of Section 6.3.a, upon a
Change of Control (i) each Option or portion thereof which, by its terms, is not
yet exercisable shall vest and become exercisable in full and (ii) each Option
which has a Termination Date falling within 90 days after a Change of Control
shall have its Termination Date extended until the earlier of the 90th day after
the Change of Control or the day before the 10th anniversary of the date such
Option was granted.
6.4. Notwithstanding any contrary provisions of Sections 6.2 and 6.3.a, no
ISO shall be granted to any employee who, at the time the Option is granted,
owns (directly, or within the meaning of Section 424(d) of the Code) more than
10% of the total combined voting power of all classes of stock of IMIC or of any
of its Subsidiaries or its Parent, if any, unless (a) the Exercise Price under
such Option is at least 110% of the Fair Market Value of a share of Common Stock
on the date the Option is granted and (b) the Termination Date of such Option is
a date not later than the day preceding the 5th anniversary of the date on which
the Option is granted.
6.5. An Option or portion thereof shall be exercised by delivery of a written
notice of exercise to IMIC and payment of the full price of the shares being
purchased pursuant to the Option. An Optionee may exercise an Option with
respect to less than the full number of shares for which the Option may then be
exercised, but an Optionee must exercise the Option in full shares of Common
Stock. Payment of the price of Common Stock purchased pursuant to an Option or
portion thereof, subject to the provisions of Section 6.6, shall be made as
follows:
6.5.a. In United States dollars in cash or by check, bank draft, or money
order payable to the order of IMIC, by wire transfer to an account designated by
IMIC, or by such other payment method as the Committee, in its discretion, may
authorize;
6.5.b. Through the delivery of shares of Common Stock with an aggregate Fair
Market Value on the date of exercise equal to the Exercise Price; or
6.5.c. By any combination of the above methods of payment. The Committee also
may permit a participant to pay the Exercise Price by authorizing a third party
to sell shares of Common Stock acquired upon exercise of the Option on condition
that such third party remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting from
such exercise as required by Section 6.6. The Committee shall determine
acceptable methods for tendering Common Stock as payment upon exercise of an
Option and may impose such limitations and prohibitions on the use of Common
Stock to exercise an Option as it deems appropriate including, without
limitation, any limitation or prohibition designed to avoid certain accounting
consequences which may result from the use of Common Stock as payment upon
exercise of an Option.
6.6. IMIC, in its discretion, may require an Optionee to pay to IMIC at the
time of exercise the amount that IMIC deems necessary to satisfy its obligation
to withhold Federal, state, or local income or other taxes incurred by reason of
the exercise. Upon the exercise of an Option requiring tax withholding, an
Optionee may make a written election to have shares of Common Stock withheld by
IMIC from the shares otherwise to be received. The number of shares so withheld
shall have an aggregate Fair Market Value on the date of exercise sufficient to
satisfy the applicable withholding taxes. The approval of any such election by
an Optionee shall be at the sole discretion of the Committee. Where the exercise
of an Option does not give rise to an obligation to withhold income taxes on the
date of exercise, IMIC, in its discretion, may require an Optionee to place
shares of Common Stock purchased under the Option in escrow for the benefit of
IMIC until such time as income tax withholding is required on amounts included
in the gross income of the Optionee as a result of the exercise of an Option. At
such time, IMIC in its discretion may require an Optionee to pay to IMIC the
amount that IMIC deems necessary to satisfy its obligation to withhold Federal,
state, or local income or other taxes incurred by reason of the exercise of the
Option, in which case the shares of Common Stock will be released from escrow to
the Optionee. Alternatively, subject to acceptance by the Committee, in its sole
discretion, an Optionee may make a written election to have shares of Common
Stock held in escrow released from escrow and applied toward IMIC's obligation
to withhold Federal, state, or local income or other taxes incurred by reason of
the exercise of the Option based on the Fair Market Value of the shares on the
date of the termination of the escrow arrangement. Upon application of such
shares toward IMIC's withholding obligation, any shares of Common Stock held in
escrow and, in the judgment of the Committee, not necessary to satisfy such
obligation shall be released from escrow to the Optionee.
6.7. At or after the grant of an Option, the Committee, in its discretion,
may provide an Optionee with an alternate means of exercising an Option, or a
designated portion thereof, by granting the Optionee a Stock Appreciation Right.
A Stock Appreciation Right is a right to receive, upon exercise of an Option or
any portion thereof, in the Committee's sole discretion, an amount of cash equal
to, and/or shares of Common Stock having a Fair Market Value on the date of
exercise equal to, the excess of the Fair Market Value of a share of Common
Stock on the date of exercise over the Exercise Price, multiplied by the number
of shares of Common Stock that the Optionee would have received had the Option
or portion thereof been exercised through the purchase of shares of Common Stock
at the Exercise Price, provided that (a) such Option or portion thereof has been
designated by the Committee as exercisable in this alternative manner, (b) such
Option or portion thereof is otherwise exercisable, and (c) the Fair Market
Value of a share of Common Stock on the date of exercise exceeds the Exercise
Price.
6.8. Each Option, during the Optionee's lifetime, shall be exercisable only
by the Optionee, and neither it nor any right under the Plan shall be
transferable otherwise than by Will or the laws of descent and distribution or
be subject to attachment, execution, or other similar process. In the event of
any attempt by the Optionee to alienate, assign, pledge, hypothecate, or
otherwise dispose of an Option or of any right under the Plan, except as
provided for in the Plan, or in the event of any levy or any attachment,
execution, or similar process upon the rights or interest conferred by the Plan,
IMIC may terminate the Option by notice to the Optionee and the Option shall
thereupon become null and void.
6.9.a. If a Termination for Cause of an Optionee's employment occurs, each
Option held by such Optionee together with all rights under the Plan shall
terminate on the date of termination of employment to the extent not previously
exercised.
6.9.b. If a non-employee Optionee engages in conduct which constitutes Cause,
each Option held by such Optionee together with all rights under the Plan shall
terminate on the date the Board determines that the Optionee has engaged in such
conduct constituting Cause to the extent not previously exercised.
6.10. If an Optionee's employment with the Company terminates for any reason
other than as a result of a Termination for Cause, or if a non-employee Optionee
shall cease to have an ongoing relationship with the Company as a member of the
Board, consultant, or other advisor for any reason other than for Cause, each
Option held by such Optionee shall remain exercisable, to the extent it was
exercisable at the time of termination of employment or cessation of ongoing
relationship, until the earliest of:
6.10.a. The Termination Date of such Option;
6.10.b. The death of the Optionee, or such later date not more than six
months after the death of the Optionee as provided in Section 6.11;
6.10.c. Two months after the date of termination of the Optionee's employment
or the date of cessation of ongoing relationship by reason of Retirement;
6.10.d. Six months after the date of termination of the Optionee's employment
or the date of cessation of ongoing relationship by reason of Disability;
6.10.e. Two months after the date of the termination by the Company of the
Optionee's employment other than as a result of a Termination for Cause or the
date of cessation of ongoing relationship other than for Cause; or
6.10.f. One month after the date of the termination by the Optionee of the
Optionee's employment or the date of cessation of ongoing relationship other
than by reason of Retirement, Disability, or death.
After such date all Options shall terminate, together with all rights under the
Plan, to the extent not previously exercised.
6.11. In the event of the death of an Optionee while employed by the Company
or in an ongoing relationship with the Company, an Option may be exercised at
any time or from time to time prior to the earlier of the Termination Date and a
date six months after the date of the Optionee's death by the person or persons
to whom the Optionee's rights under each Option shall pass by Will or by the
applicable laws of descent and distribution to the extent that the Optionee was
entitled to exercise it on the date of the Optionee's death. In the event of the
death of an Optionee no longer employed by the Company or no longer in an on-
going relationship with the Company while entitled to exercise an Option
pursuant to Section 6.10, the Committee, in its discretion, may permit such
Option to be exercised at any time or from time to time prior to the Termination
Date during a period of up to six months from the death of the Optionee, as
determined by the Committee, by the person or persons to whom the Optionee's
rights under each Option shall pass by Will or by the applicable laws of descent
and distribution to the extent that the Option was exercisable at the time of
cessation of the Optionee's employment or service as a member of the Board,
consultant, or other advisor. Any person or persons to whom an Optionee's rights
under an Option have passed by Will or by the applicable laws of descent and
distribution shall be subject to all terms and conditions of the Plan and the
Option applicable to the Optionee.
6.12. Any Optionee who disposes of shares of Common Stock acquired upon the
exercise of an ISO either (a) within two years after the date of the grant of
the ISO under which the Common Stock was acquired or (b) within one year after
the transfer of such shares to the Optionee, shall notify IMIC of such
disposition and of the amount realized upon such disposition.
SECTION VII
LIMITATION ON GRANTS OF ISOS
7.1. To the extent the aggregate Fair Market Value of the Common Stock
subject to an Option which is exercisable for the first time during any one
calendar year by an employee exceeds $100,000, such excess portion of the Option
may not be treated as an ISO.
SECTION VIII
LIMITED RIGHTS
8.1.a. Limited Rights may be granted by the Committee in conjunction with all
or any portion of any Option granted under the Plan and such rights may be
granted either at or after the time of the grant of such Option.
8.1.b. Limited Rights or any applicable portion thereof granted with respect
to a given Option shall terminate and no longer be exercisable upon the
termination of the related Option. Upon the exercise of an Option, the related
Limited Right shall cease to be exercisable to the extent of the shares of
Common Stock with respect to which such Option is exercised.
8.1.c. A Limited Right related to an Option may be exercised by an Optionee,
in accordance with Section 8.2, by surrendering the applicable portion of the
related Option. Upon such exercise and surrender, the Optionee shall be entitled
to receive an amount determined in the manner prescribed in Section 8.2.
8.2. Limited Rights shall be subject to such terms and conditions not
inconsistent with the provisions of the Plan, as shall be determined from time
to time by the Committee or the Board, including the following:
8.2.a. Limited Rights can only be exercised within the Change of Control
Exercise Period, which is the 30-day period following a Change of Control, and
will become fully exercisable, if not already fully exercisable, upon the Change
of Control, provided that any Limited Right shall not exercisable by any
Optionee who is subject to Section 16(b) of the Exchange Act during the first 6
months of the date of grant of a Limited Right. In the event a Change of Control
shall occur within 6 months of the date of grant of a Limited Right to an
Optionee who is subject to Section 16(b) of the Exchange Act, the Change of
Control Exercise Period for such Optionee shall be deemed to commence on the
first day following such 6 month period.
8.2.b. Upon the exercise of a Limited Right related to an Option, an Optionee
shall be entitled to receive an amount in cash equal in value to the excess of
the Change of Control Price over the Option Price specified in the related
Option, such excess to be multiplied by the number of shares of Common Stock in
respect of which the Limited Right shall have been exercised.
8.2.c. Limited Rights shall be transferable only at such time or times and to
the extent that the underlying Option would be transferable under Section 6.8.
SECTION IX
ADJUSTMENTS
9.1. If (a) IMIC shall at any time be involved in a transaction to which
Section 424(a) of the Code is applicable, (b) IMIC shall declare a dividend
payable in, or shall subdivide or combine, its Common Stock, or (c) any other
event shall occur which in the judgment of the Committee necessitates action by
way of adjusting the terms of the outstanding Options, the Committee may take
any such action as in its judgment shall be necessary to preserve the Optionee's
rights substantially proportionate to the rights existing prior to such event
and to the extent that such action shall include an increase or decrease in the
number of shares of Common Stock subject to outstanding Options, the number of
shares available under Section IV shall be increased or decreased, as the case
may be, proportionately. The judgment of the Committee with respect to any
matter referred to in this Section IX shall be conclusive and binding upon each
Optionee.
SECTION X
AMENDMENT AND TERMINATION OF PLAN
10.1. The Board may at any time, or from time to time, suspend or terminate
the Plan in whole or in part or amend it in such respects as the Board may deem
appropriate, provided that no such amendment shall be made which would, without
approval of the shareholders of IMIC:
10.1.a. Materially modify the eligibility requirements for receiving Options;
10.1.b. Materially increase the total number of shares of Common Stock which
may be issued pursuant to Options, except as provided in Section IX; or
10.1.c. Materially increase in any way the benefits accruing to Optionees.
10.2. No amendment, suspension, or termination of this Plan, without the
Optionee's consent, shall alter or impair any of the rights or obligations under
any Option theretofore granted to an Optionee under the Plan.
SECTION XI
GOVERNMENT AND OTHER REGULATIONS
11.1. The obligation of IMIC to issue, or transfer and deliver, shares for
Options exercised under the Plan or to deliver cash upon exercise of a Limited
Right or with respect to a Stock Appreciation Right, shall be subject to all
applicable laws, regulations, rules, orders, and approvals which shall then be
in effect and required by governmental entities and/or any national securities
exchange on which Common Stock may be traded or listed.
SECTION XII
MISCELLANEOUS PROVISIONS
12.1. The right of the Company to terminate (whether by dismissal, discharge,
retirement, or otherwise) the Optionee's employment or service as a member of
the Board, consultant, or other advisor at any time at will or as otherwise
provided by any agreement between the Company and the Optionee is specifically
reserved. Neither the Optionee nor any person entitled to exercise the
Optionee's rights in the event of the Optionee's death shall have any of the
rights of a shareholder with respect to the shares subject to each Option except
to the extent that, and until, such shares shall have been issued upon the
exercise of each Option.
12.2. All expenses of administering the Plan shall be borne by IMIC.
12.3. Payments received from Optionees upon the exercise of Options shall be
used for the general corporate purposes of IMIC except that any stock received
or withheld in payment may be canceled, retired, or retained in IMIC's treasury
and reissued.
12.4. In addition to such other rights of indemnification as they may have as
members of the Board or the Committee, the members of the Board and the
Committee shall be indemnified by IMIC against all costs and expenses reasonably
incurred by them in connection with any action, suit, or proceeding to which
they or any of them may be party by reason of any action taken or failure to act
under or in connection with the Plan or any Option granted under the Plan, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by independent legal counsel selected by IMIC) or paid by them in
satisfaction of a judgment in any such action, suit, or proceeding, except a
judgment based upon a finding of wilful misconduct or bad faith, provided that
upon the institution of any such action, suit, or proceeding, a Committee or
Board member, in writing, shall give IMIC notice thereof and an opportunity, at
its own expense, to handle and defend the same before such Committee or Board
member undertakes to handle and defend it on such member's own behalf.
SECTION XIII
SHAREHOLDER APPROVAL AND EFFECTIVE DATE
13.1. The Plan shall become effective upon adoption by the Board. However, if
the Plan is not approved within one year after the Plan is adopted by the Board
by the vote at a meeting of the shareholders of IMIC at which a quorum is
present by the holders of a majority of the shares voting at that meeting, the
Plan and all Options shall terminate at the time of that meeting of
shareholders, or, if no such meeting is held, after the passage of one year from
the date the Plan was adopted by the Board. Options may not be granted under the
Plan after the day before the 10th anniversary of adoption by the Board.
EXHIBIT 4.5
INDUSTRI-MATEMATIK INTERNATIONAL CORP.
1997 EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
Purpose
The purpose of the Industri-Matematik International Corp. 1997 Employee Stock
Purchase Plan is to provide employees of Industri-Matematik International Corp.
and its subsidiaries with an opportunity to purchase Industri-Matematik
International Corp. Common Stock pursuant to an "employee stock purchase plan"
meeting the requirements set forth in Section 423 of the Internal Revenue Code
of 1986.
ARTICLE II
Definitions
2.1. The following capitalized terms used in this Employee Stock Purchase
Plan shall have the meanings set forth in this Section 2.1.
Accrual Period shall mean a period of six months, commencing on January 1 and
July 1 of each year, and terminating on the next following June 30 or December
31, respectively, provided that the first Accrual Period shall commence on the
Effective Date and shall end on June 30, 1997, and the fourth Accrual Period in
any Purchase Period shall be five months in duration.
Board shall mean the Board of Directors of the Company.
Code shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder.
Common Stock shall mean the Common Stock, $.01 par value, of the Company.
Company shall mean Industri-Matematik International Corp., a Delaware
corporation.
Compensation shall mean an Employee's total compensation paid by the Company
or one or more Designated Subsidiaries, including such amounts as are deferred
by the Employee (a) under a qualified cash or deferred arrangement described in
Section 401(k) of the Code or (b) pursuant to a plan qualified under Section 125
of the Code.
Corporate Transaction shall mean any of the following shareholder approved
transactions to which the Company is a party: (a) a merger or consolidation in
which the Company is not the surviving entity, except for a transaction the
principal purpose of which is to change the state in which the Company is
incorporated, (b) the sale, transfer, or other disposition of all or
substantially all of the assets of the Company (including the capital stock of
the Company's Subsidiaries) in connection with the complete liquidation or
dissolution of the Company, or (c) any reverse merger in which the Company is
the surviving entity but in which securities possessing more than 50% of the
total combined voting power of the Company's outstanding securities are
transferred to a person or persons other than those who held such securities
immediately prior to such merger.
Current Accrual Period shall mean any Accrual Period which ends in a then
current calendar year.
Designated Subsidiaries shall mean the Subsidiaries which have been designated
by the Plan Administrator from time to time as eligible to participate in the
Plan.
Effective Date shall mean February 26, 1997, provided that if a Designated
Subsidiary becomes a participating company in the Plan after such date, the Plan
Administrator shall designate a separate Effective Date with respect to such
Subsidiary's Employee Participants.
Employee shall mean any individual, including an officer or director, who is
an employee of the Company or a Designated Subsidiary, provided that for
purposes of the Plan, the employment relationship shall be treated as continuing
intact while the individual is on sick leave or other leave of absence approved
by the individual's employer. Where the period of leave exceeds 90 days and the
individual's right to reemployment is not guaranteed either by statute or by
contract, the employment relationship will be deemed to have terminated on the
91st day of such leave for purposes of determining eligibility to participate in
the Plan.
Enrollment Date shall mean the first day of each Purchase Period.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended from
time to time.
Exercise Date shall mean the last day of each Accrual Period.
Fair Market Value on a specified day shall mean the closing price for a share
of Common Stock for the last market trading day prior to the time of the
determination on the Nasdaq National Market (or if the Common Stock is listed on
another national stock exchange, on that stock exchange) or, if no closing price
was reported on that date, on the last trading date on which a closing price was
reported, as reported in The Wall Street Journal or such other source as the
Plan Administrator deems reliable.
Participant shall mean an Employee of the Company or Designated Subsidiary who
is participating in the Plan.
Plan shall mean this Industri-Matematik International Corp. 1997 Employee
Stock Purchase Plan.
Plan Administrator shall mean the person or persons appointed by the Board who
is responsible for the administration of the Plan.
Purchase Period shall mean a purchase period established pursuant to Article
IV hereof.
Purchase Price shall mean an amount equal to 85% of the Fair Market Value of a
share of Common Stock on the Enrollment Date or on the Exercise Date, whichever
is lower.
Reserves shall mean the number of shares of Common Stock covered by each
option under the Plan which have not yet been exercised and the number of shares
of Common Stock which have been authorized for issuance under the Plan but not
yet placed under option.
Rule 16b-3 shall mean Rule 16b-3 promulgated under the Exchange Act, as
amended from time to time.
Subsidiary shall mean a "subsidiary corporation," whether now or hereafter
existing, as defined in Section 424(f) of the Code.
2.2. When used in this Plan, unless the context clearly indicates to the
contrary, the masculine gender shall include the feminine and neuter genders and
the singular shall include the plural, and if a defined term is intended, it
shall be capitalized.
ARTICLE III
Eligibility
3.1. Any individual who is an Employee on a given Enrollment Date shall be
eligible to participate in the Plan for the Purchase Period commencing with such
Enrollment Date. Members of the Board who are eligible Employees are permitted
to participate in the Plan except to the extent limited by Section 3.3.
3.2. Any provisions of the Plan to the contrary notwithstanding, no Employee
shall be granted an option under the Plan (a) if, immediately after the grant,
such Employee (taking into account stock owned by any other person whose Common
Stock would be attributed to such Employee pursuant to Section 424(d) of the
Code) would own Common Stock and/or hold outstanding options to purchase Common
Stock possessing 5% or more of the total combined voting power or value of all
classes of Common Stock of the Company or of a Subsidiary or (b) which permits
his rights to purchase shares of capital stock of the Company under all employee
stock purchase plans of the Company and its Subsidiaries to accrue at a rate
which exceeds $25,000 worth of capital stock of the Company (determined at the
Fair Market Value of the shares at the time such option is granted) for each
calendar year in which such option is outstanding at any time.
3.3. Notwithstanding the provisions of Section 3.1, the following Employees
shall not be eligible to participate in the Plan for any relevant Purchase
Period: (a) Employees whose customary employment is 20 hours or less per week,
(b) Employees whose customary employment is for not more than 5 months in any
calendar year, (c) Employees who were not employed at the start of the latest
Purchase Period, and (d) Employees who are subject to rules or laws of a foreign
jurisdiction that prohibit or make impractical the participation of such
Employees in the Plan.
ARTICLE IV
Purchase Periods
4.1. The Plan shall be implemented through overlapping or consecutive
Purchase Periods until such time as (a) the maximum number of shares of Common
Stock available for issuance under the Plan shall have been purchased or (b) the
Plan shall have been sooner terminated in accordance with Article XVIII. The
maximum duration of a Purchase Period shall be 23 months. Initially, the Plan
shall be implemented through overlapping Purchase Periods of 23 months
commencing each January 1 and July 1 following the Effective Date (except that
the initial Purchase Period shall commence on the Effective Date and shall end
on December 31, 1998). The Plan Administrator shall have the authority to
change the length of any Purchase Period, to change the length of Accrual
Periods within any Purchase Period subsequent to the initial Purchase Period,
and to determine whether subsequent Purchase Periods shall be consecutive or
overlapping by announcement at least 30 days prior to the commencement of the
Purchase Period.
4.2. A Participant shall be granted a separate option for each Purchase
Period in which he participates. Options shall be granted on the Enrollment
Date and shall be automatically exercised in successive installments on the
Exercise Dates within the Purchase Period.
4.3. An Employee may participate in only one Purchase Period at a time.
Accordingly, except as provided in Section 4.4, an Employee who wishes to join a
new Purchase Period must withdraw from the current Purchase Period in which he
is participating and enroll in the new Purchase Period prior to the Enrollment
Date for that Purchase Period, provided the Participant is eligible to
participate in the Plan on that date and has not elected to terminate
participation in the Plan.
4.4. If, on the first day of any Accrual Period in a Purchase Period in which
a Participant is participating, the Fair Market Value of the Common Stock is
less than the Fair Market Value of the Common Stock on the Enrollment Date of
the Purchase Period (after taking into account any adjustment during the
Purchase Period pursuant to Section 17.1), the Purchase Period shall be
terminated automatically and the Participant shall be enrolled automatically in
the new Purchase Period which has its first Accrual Period commencing on that
date, provided the Participant is eligible to participate in the Plan on that
date and has not elected to terminate participation in the Plan.
4.5. Except as specifically provided in the Plan, the acquisition of Common
Stock through participation in the Plan in any Purchase Period shall neither
limit nor require the acquisition of Common Stock by a Participant in any
subsequent Purchase Period.
ARTICLE V
Participation
5.1. An eligible Employee may become a Participant in the Plan by completing
a subscription agreement which either authorizes payroll deductions or elects
such other payment plan as may be established by the Plan Administrator from
time to time in a form authorized by the Plan Administrator and filing it with
the designated payroll office of the Company at least 10 business days prior to
the Enrollment Date for the Purchase Period in which such participation will
commence, unless a later time for filing the subscription agreement is set by
the Plan Administrator for all eligible Employees with respect to a given
Purchase Period, provided that the time for filing with respect to the initial
Enrollment Date will be fixed by the Plan Administrator.
5.2. Payroll deductions for a Participant, if applicable, shall commence with
the first payroll period following the Enrollment Date and shall end on the last
complete payroll period during the Purchase Period, unless sooner terminated by
the Participant as provided in Article VI, provided that the commencement date
for payroll deductions following the initial Enrollment Date will be fixed by
the Plan Administrator.
ARTICLE VI
Payroll Deductions or Other Participant Payments
6.1. At the time a Participant files his subscription agreement, he shall
elect to have payroll deductions made during the Purchase Period from the
Compensation which he receives during the Purchase Period, unless the Plan
Administrator has authorized, and the Participant has elected, another form of
payment.
6.2. All payroll deductions made for a Participant or other elected forms of
payment authorized by the Plan Administrator and made by a Participant shall be
credited to his account under the Plan. Payroll deductions will be withheld in
whole percentages only.
6.3. A Participant may discontinue his participation in the Plan as provided
in Sections 6.5 and 6.6 or may change the rate of his payroll deductions or
other form of payment authorized by the Plan Administrator during the Purchase
Period by completing and filing with the Company a new subscription agreement
authorizing such change. A change in payroll deduction rate shall be effective
with the first full payroll period commencing 10 business days after the
Company's receipt of the new subscription agreement unless the Company elects to
process a given change more quickly. The Plan Administrator shall be authorized
to limit the number of payroll deduction rate changes or changes in other forms
of payment during any Purchase Period.
6.4. Notwithstanding the provisions of Section 6.3, to the extent necessary
to comply with Section 423(b)(8) of the Code and Section 3.2 herein, a
Participant's payroll deductions or other form of payment authorized by the Plan
Administrator may be decreased to 0% at such time during any Current Accrual
Period as the aggregate of all payroll deductions and payments which were
previously used to purchase Common Stock under the Plan in a prior Accrual
Period which ended during the calendar year of the Current Accrual Period plus
all payroll deductions and other payments accumulated with respect to the
Current Accrual Period equal $21,250. Payroll deductions and other forms of
payment authorized by the Plan Administrator shall recommence at the rate
provided in such Participant's subscription agreement at the beginning of the
first Accrual Period which is scheduled to end in the following calendar year,
unless the Participant elects another form of payment authorized by the Plan
Administrator or discontinues participation in the Plan.
6.5. A Participant may withdraw all but not less than all the payroll
deductions and other payments made which were credited to his account and not
yet used to exercise his option under the Plan at any time by giving written
notice to the Company in a form authorized by the Plan Administrator. All of
the Participant's payroll deductions and other payments credited to his account
will be paid to such Participant as promptly as practicable after receipt of
notice of withdrawal, such Participant's option for the Purchase Period will be
automatically terminated, and no further payroll deductions for the purchase of
shares will be made or payments accepted during the Purchase Period. If a
Participant withdraws from a Purchase Period, payroll deductions and other forms
of payment will not resume at the beginning of the succeeding Purchase Period
unless the Participant delivers to the Company a new subscription agreement.
6.6. Upon a Participant's ceasing to be an Employee for any reason, the
payroll deductions and other payments credited to such Participant's account
during the Purchase Period but not yet used to exercise an option will be
returned to such Participant or, in the case of his death, to the person or
persons entitled thereto under Article XIII, and such Participant's option will
be automatically terminated.
ARTICLE VII
Grant of Option
On the Enrollment Date, each Participant in such Purchase Period shall be
granted an option to purchase on each Exercise Date during such Purchase Period
(at the applicable Purchase Price) up to a number of shares of the Common Stock
determined by dividing such Participant's payroll deductions or other payments
authorized by the Plan Administrator accumulated prior to such Exercise Date and
retained in the Participant's account as of the Exercise Date by the applicable
Purchase Price, provided that such purchase shall be subject to the limitations
set forth in Sections 3.2 and 11.1. Exercise of the option shall occur as
provided in Article VIII, unless the Participant has withdrawn pursuant to
Section 6.5, and the option, to the extent not exercised, shall expire on the
last day of the Purchase Period.
ARTICLE VIII
Exercise of Option
8.1. Unless a Participant withdraws from the Plan as provided in Section 6.5
or his option is terminated as provided in Section 6.6, his option for the
purchase of shares will be exercised automatically on each Exercise Date, and
the maximum number of full shares subject to the option shall be purchased for
such Participant at the applicable Purchase Price with the accumulated amounts
in his account. No fractional shares will be purchased; any amounts accumulated
in a Participant's account which are not sufficient to purchase a full share
shall be carried over to the next Accrual Period or Purchase Period, whichever
applies, or returned to the Participant, if the Participant withdraws from the
Plan. During a Participant's lifetime, a Participant's option to purchase
shares hereunder is exercisable only by him.
8.2. The maximum number of shares of Common Stock a Participant shall be
permitted to purchase in any Accrual Period shall be 500, subject to adjustment
as provided in Article XVII.
ARTICLE IX
Delivery
Upon receipt of a request from a Participant after each Exercise Date on which
a purchase of shares occurs, the Company shall arrange the delivery to such
Participant, as promptly as practicable, of a certificate representing the
shares of Common Stock purchased upon exercise of his option.
ARTICLE X
Interest
No interest shall accrue on the payroll deductions or other amounts credited
to a Participant's account under the Plan.
ARTICLE XI
Stock
11.1. The maximum number of shares of Common Stock which shall be made
available for sale under the Plan shall be 1,200,000 shares, subject to
adjustment upon changes in capitalization of the Company as provided in Article
XVII. If on a given Exercise Date the number of shares of Common Stock with
respect to which options are to be exercised exceeds the number of shares then
available under the Plan, the Plan Administrator shall make a pro rata
allocation of the shares of Common Stock remaining available for purchase in as
uniform a manner as shall be practicable and as it shall determine to be
equitable.
11.2. A Participant will have no interest or voting right in shares of
Common Stock covered by his option until such shares of Common Stock are
actually purchased on the Participant's behalf in accordance with the applicable
provisions of the Plan. No adjustment shall be made for dividends,
distributions, or other rights for which the record date is prior to the date of
such purchase.
11.3. Shares of Common Stock to be delivered to a Participant under the Plan
will be registered in the name of the Participant or, if requested in writing,
in the name of the Participant and his spouse.
ARTICLE XII
Administration
12.1. The Plan shall be administered by one or more persons appointed by the
Board. The Plan Administrator appointed by the Board shall have full and
exclusive discretionary authority to construe, interpret, and apply the terms of
the Plan, to determine eligibility, and to adjudicate all disputed claims filed
under the Plan. Every finding, decision, and determination made by the Plan
Administrator appointed by the Board, to the full extent permitted by law, shall
be final and binding upon all persons.
12.2. Notwithstanding the provisions of Section 12.1, in the event that Rule
16b-3 provides specific requirements for the administrators of plans of this
type, the Plan shall be administered only by such a body or person and in such a
manner as shall comply with the applicable requirements of Rule 16b-3.
ARTICLE XIII
Designation of Beneficiary
13.1. Each Participant will file a written designation of a beneficiary who
is to receive any shares of Common Stock and cash, if any, from the
Participant's account under the Plan in the event of such Participant's death.
If a Participant is married and the designated beneficiary is not the spouse,
spousal consent shall be required for such designation to be effective.
13.2. Such beneficiary designation may be changed by the Participant (and
his spouse, if any) at any time by written notice. In the event of the death of
a Participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such Participant's death, the Company shall
deliver such shares of Common Stock and/or cash to the executor or administrator
of the estate of the Participant, or if no such executor or administrator has
been appointed (to the knowledge of the Plan Administrator), the Plan
Administrator, in its discretion, may deliver such shares of Common Stock and/or
cash to the spouse or to any one or more dependents or relatives of the
Participant, or if no spouse, dependent, or relative is known to the Plan
Administrator, then to such other person as the Plan Administrator may
designate.
ARTICLE XIV
Transferability
Neither payroll deductions or other deposits credited to a Participant's
account nor any rights with regard to the exercise of an option or to receive
shares of Common Stock under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in Article XIII) by the Participant. Any such
attempt at assignment, transfer, pledge, or other disposition shall be without
effect, except that the Plan Administrator may treat such act as an election to
withdraw funds from a Purchase Period in accordance with Section 6.5.
ARTICLE XV
Use of Funds
All payroll deductions or other deposits received or held by the Company under
the Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such payroll deductions or other deposits.
ARTICLE XVI
Reports
Individual accounts will be maintained for each Participant in the Plan.
Statements of account will be given to Participants at least annually, which
statements will set forth the amounts of payroll deductions and other deposits,
the Purchase Price, the number of shares purchased, and the remaining cash
balance, if any.
ARTICLE XVII
Adjustments Upon Changes in Capitalization and Corporate Transactions
17.1. Subject to any required action by the shareholders of the Company, the
Reserves, as well as the Purchase Price, shall be proportionately adjusted for
any increase or decrease in the number of issued shares of Common Stock
resulting from a stock split, reverse stock split, stock dividend, combination,
or reclassification of the Common Stock, or any other similar event resulting in
an increase or decrease in the number of issued shares of Common Stock. Such
adjustment shall be made by the Plan Administrator, whose determination in that
respect shall be final, binding, and conclusive. Except as expressly provided
in this Section 17.1, no issue by the Company of shares of stock of any class,
or securities convertible into shares of stock of any class, shall affect, and
no adjustment by reason thereof shall be made with respect to, the number or
price of shares of Common Stock subject to an option. The Plan Administrator,
if it so determines in the exercise of its sole discretion, may make provision
for adjusting the Reserves, as well as the price per share of Common Stock
covered by each outstanding option, in the event the Company effects one or more
reorganizations, recapitalizations, rights offerings, or other increases or
reductions of shares of its outstanding Common Stock.
17.2. In the event of a proposed Corporate Transaction, each option under
the Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Plan Administrator determines, in the exercise of his sole discretion
and in lieu of such assumption or substitution, to shorten the Purchase Period
then in progress by setting a new Exercise Date. If the Plan Administrator
shortens the Purchase Period then in progress in lieu of assumption or
substitution in the event of a Corporate Transaction, the Plan Administrator
shall notify each Participant in writing, at least 10 days prior to the new
Exercise Date, that the Exercise Date for his option has been changed to the new
Exercise Date and that his option will be exercised automatically on the new
Exercise Date unless prior to such date he has withdrawn from the Purchase
Period as provided in Section 6.5. For purposes of this Section 17.2, an option
granted under the Plan shall be deemed to be assumed if, following the Corporate
Transaction, the option confers the right to purchase, for each share of Common
Stock subject to the option immediately prior to the Corporate Transaction, the
consideration (whether stock, cash, or other securities or property) received in
the Corporate Transaction by holders of Common Stock for each share of Common
Stock held on the effective date of the Corporate Transaction (and if such
holders were offered a choice of consideration, the type of consideration chosen
by the holders of a majority of the outstanding shares of Common Stock),
provided that if such consideration received in the Corporate Transaction was
not solely common stock of the successor corporation or its parent, the Plan
Administrator, with the consent of the successor corporation and the
Participant, may provide for the consideration to be received upon exercise of
the option to be solely common stock of the successor corporation or its parent
equal in fair market value to the per share consideration received by holders of
Common Stock in the Corporate Transaction.
ARTICLE XVIII
Amendment or Termination
18.1. The Plan Administrator, at any time and for any reason, may terminate
or amend the Plan. Except as provided in Article XVII, such termination cannot
affect options previously granted, provided that a Purchase Period may be
terminated by the Plan Administrator on any Exercise Date if the Plan
Administrator determines that the termination of the Plan is in the best
interests of the Company and its shareholders. Except as provided in Article
XVII, no amendment may make any change in any option theretofore granted which
adversely affects the rights of any Participant. To the extent necessary to
comply with Rule 16b-3 or Section 423 of the Code (or any successor rule or
provision or any other applicable law or regulation), the Company shall obtain
stockholder approval in such a manner and to such a degree as required.
18.2. Without shareholder consent and without regard to whether any
Participant rights may be considered to have been "adversely affected," the Plan
Administrator shall be entitled to change the Purchase Periods, limit the
frequency and/or number of changes in the amount withheld during Purchase
Periods, make available or terminate alternative Participant payment options,
establish the exchange ratio applicable to amounts withheld in a currency other
than U.S. dollars, establish additional terms, conditions, rules, or procedures
to accommodate the rules or laws of applicable foreign jurisdictions, permit
payroll withholding in excess of the amount designated by a Participant in order
to adjust for delays or mistakes in the Company's processing of properly
completed withholding elections, establish reasonable waiting and adjustment
periods and/or accounting and crediting procedures to ensure that amounts
applied toward the purchase of Common Stock for each Participant properly
correspond with amounts withheld from the Participant's Compensation or
otherwise paid by the Participant, and establish such other limitations or
procedures as the Plan Administrator in its sole discretion determines advisable
and which are consistent with the Plan.
ARTICLE XIX
Notices
All notices or other communications by a Participant to the Company under or
in connection with the Plan shall be deemed to have been duly given when
received in the form specified by the Plan Administrator at the location, or by
the person, designated by the Plan Administrator for the receipt thereof.
ARTICLE XX
Conditions Upon Issuance of Shares of Common Stock
Shares of Common Stock shall not be issued with respect to an option unless
the exercise of such option and the issuance and delivery of such shares of
Common Stock pursuant thereto shall comply with all applicable provisions of
law, domestic or foreign, including, without limitation, the Securities Act of
1933, as amended, and the Exchange Act and the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance. As a condition to the exercise of an
option, the Company may require the Participant to represent and warrant at the
time of any such exercise that the shares of Common Stock are being purchased
only for investment and without any present intention to sell or distribute such
shares if, in the opinion of counsel for the Company, such a representation is
required by any of the aforementioned applicable provisions of law.
ARTICLE XXI
Term of Plan
The Plan shall become effective upon the earlier to occur of its adoption by
the Board or its approval by the shareholders of the Company and it shall
continue in effect for a term of 10 years unless sooner terminated under Article
XVIII.
ARTICLE XXII
Additional Restrictions of Rule 16b-3
The terms and conditions of options granted under the Plan to, and the
purchase of shares by, persons subject to Section 16 of the Exchange Act shall
comply with the applicable provisions of Rule 16b-3. This Plan shall be deemed
to contain, and the shares of Common Stock issued upon exercise of an option
granted under the Plan shall be subject to, such additional conditions and
restrictions as may be required by Rule 16b-3 to qualify for the maximum
exemption from Section 16 of the Exchange Act with respect to Plan transactions.
ARTICLE XXIII
Shareholder Approval
Continuance of the Plan shall be subject to approval by the shareholders of
the Company within 12 months after the date the Plan is adopted by the Board. If
such shareholder approval is obtained at a duly held shareholders' meeting, the
Plan must be approved by a majority of the votes cast at such shareholders'
meeting at which a quorum representing a majority of all outstanding voting
stock of the Company, either in person or by proxy, is present and voting on the
Plan. However, approval at a meeting may be obtained by a lesser degree of
shareholder approval if the Plan Administrator, in its discretion after
consultation with the Company's legal counsel, determines that such a lesser
degree of shareholder approval will comply with all applicable laws and will not
adversely affect the qualification of the Plan under Section 423 of the Code.
ARTICLE XXIV
No Employment Rights
The Plan does not, directly or indirectly, create any right for the benefit of
any Employee or class of Employees to purchase any shares of Common Stock under
the Plan, or create in any Employee or class of employees any right with respect
to continuation of employment by the Company or a Designated Subsidiary, and it
shall not be deemed to interfere in any way with such employer's right to
terminate, or otherwise modify, an Employee's employment at any time.
ARTICLE XXV
Effect of Plan
The provisions of the Plan, in accordance with its terms, shall be binding
upon and inure to the benefit of each Participant and his distributees, personal
representatives, executors, and administrators, and any receiver, trustee in
bankruptcy, or representative of creditors of such Participant.
ARTICLE XXVI
Information to Participants
The Company shall provide to each Participant, during the period for which
such Participant has an option outstanding, copies of all annual reports and
other information which is provided to all shareholders of the Company.
ARTICLE XXVII
Applicable Law
The laws of the state of Delaware will govern all matters relating to this
Plan except to the extent it is superseded by the laws of the United States.
EXHIBIT 5.1
[TANNENBAUM DUBIN & ROBINSON, LLP]
June 30, 1999
Industri-Matematik International Corp.
901 Market Street
Suite 475
Wilmington, Delaware 19801
Re: Registration Statement on Form S-8 Relating to the
Indusri-Matematik International Corp. Restricted Stock
Program, the Industri-Matematik International Corp.
1998 Stock Option Plan, and the Industri-Matematik
International Corp. 1997 Employee Stock Purchase Plan
(collectively, "Plans")
---------------------------------------------------
Gentlemen:
This opinion is submitted in connection with the Registration Statement on
Form S-8 ("Registration Statement") filed by Industri-Matematik International
Corp. ("Company") on the date hereof with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, relating to 3,940,000 shares of
Common Stock, $.01 par value, of the Company issued or issuable pursuant to the
Plans.
We have examined such corporate documents and records of the Company,
certificates of public officials, and such other documents and questions of law
as we have deemed necessary or appropriate for the purpose of rendering this
opinion.
In examining the foregoing, we have assumed, without independent
verification, the genuineness of all signatures and the authenticity of all
documents submitted to us as originals and the conformity to original documents
of documents submitted to us as certified or photostatic copies. While nothing
has been brought to our attention which leads us to believe that the opinions
expressed herein are factually incorrect, we have not, beyond the examination
described above, made independent factual investigations for the purpose of
rendering this opinion although we have made such inquiry of officers of the
Company as we have deemed necessary for the proper discharge of our
responsibilities as counsel to the Company and for the purpose of rendering this
opinion.
Notwithstanding anything herein to the contrary, whether expressly stated
or implied, the opinion hereinafter expressed is subject to the following
further qualifications and limitations, whether or not a specific reference is
made in this opinion to such qualifications and limitations:
A. The effect of applicable bankruptcy, insolvency, reorganization,
moratorium, or other similar laws, statutes, or rules of general application
relating to, or affecting, the enforcement of creditors' rights generally, now
or hereafter in effect.
B. As we are admitted to practice only in the State of New York, our
opinion is limited to the laws of the United States and the State of New York
and we offer no opinion as to the possible application of laws of other
jurisdiction, provided that insofar as this opinion relates to matters of
Delaware law, we have relied upon the opinion of Messrs. Hunton & Williams,
Richmond, Virginia.
C. The effect of rules of law governing specific performance and
injunctive relief and such other principles of equity as the courts having
jurisdiction may apply at their discretion whether in a proceeding at law or in
equity.
Based upon the foregoing and upon such other information, documents, and
inquiry as we believe necessary to enable us to render this opinion, we are of
the opinion that (i) the 340,000 shares of Common Stock issued under the
Industri-Matematik International Corp. Restricted Stock Program have been duly
authorized, validly issued, and, when a note issued in exchange for shares sold
pursuant to the program is paid, such shares will be fully paid and non-
assessable, (ii) the 3,000,000 shares of Common Stock issuable under the
Industri-Matematik International Corp. 1998 Stock Option Plan have been duly
authorized and, when issued and paid for in accordance with the terms of any
option granted under that Plan, will be validly issued, fully paid, and
non-assessable, and (iii) the 600,000 new shares of Common Stock issuable under
the Industri-Matematik International Corp. 1997 Employee Stock Purchase Plan
have been duly authorized and, when issued and paid for in accordance with the
terms of any option granted under that Plan, will be validly issued, fully paid,
and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement.
Respectfully submitted,
/s/ Tannenbaum Dubin & Robinson, LLP
-------------------------------------
TANNENBAUM DUBIN & ROBINSON, LLP
EXHIBIT 23.2
CONSENT OF OHRLINGS COOPERS & LYBRAND AB,
INDEPENDENT AUDITORS
We consent to the inclusion in the Prospectus constituting part of this
Registration Statement on Form S-8 of our report dated July 29, 1998, on our
audits of the consolidated financial statements of Industri-Matematik
International Corp. as of April 30, 1997 and 1998 and for the years ended April
30, 1996, 1997, and 1998. We also consent to the reference to our firm under
the caption "Experts".
/s/ Ohrlings Coopers & Lybrand AB
---------------------------------
OHRLINGS COOPERS & LYBRAND AB
Stockholm, Sweden
June 25, 1999
