<PAGE> 1
As filed with the Securities and Exchange Commission on May 15, 2000
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SEQUOIA SOFTWARE CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
MARYLAND 52-1956677
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
5457 TWIN KNOLLS ROAD
COLUMBIA, MARYLAND 21045
(Address of principal executive offices) (Zip Code)
</TABLE>
SEQUOIA SOFTWARE CORPORATION 2000 STOCK INCENTIVE PLAN
(Full title of plans)
<TABLE>
<S> <C>
(Name, address and telephone
number of agent for service) (Copy to:)
RICHARD C. FAINT, JR. EDWIN M. MARTIN, JR., ESQUIRE
CHIEF EXECUTIVE OFFICER PIPER MARBURY RUDNICK & WOLFE LLP
SEQUOIA SOFTWARE CORPORATION 1200 19TH STREET, N.W.
5457 TWIN KNOLLS ROAD WASHINGTON, D.C. 20036
COLUMBIA, MARYLAND 21045 (202) 861-3900
(410) 715-0206
</TABLE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==================================================================================================================================
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TO BE OFFERING AGGREGATE REGISTRATION
TITLE OF SECURITIES TO BE REGISTERED REGISTERED PRICE PER UNIT OFFERING PRICE FEE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.001 par value 6,828,775 (1) $8.00 (2) $54,630,200 (2) $14,422.37 (2)
- ----------------------------------------------------------------------------------------------------------------------------------
2,354,238 (1) $1.15 (3) $2,707,374 (3) $714.75 (3)
- ----------------------------------------------------------------------------------------------------------------------------------
Total 9,183,013 (1) N/A $57,337,574 $15,137.12
==================================================================================================================================
</TABLE>
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, as amended,
this Registration Statement also covers an indeterminate number of shares of
Common Stock that may be offered or issued by reason of stock splits, stock
dividends or similar transactions.
(2) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457. The proposed maximum offering price per share, proposed
maximum aggregate offering price and the amount of the registration fee are
based on the initial public offering price of Sequoia Software Corporation
Common Stock on May 11, 2000 (i.e., $8.00).
(3) Computed solely for purposes of calculating the registration fee pursuant
to Rule 457(h). The proposed maximum offering price per share, proposed maximum
aggregate offering price, and the amount of the registration fee are based on
the weighted average per share exercise price of the Plan's outstanding options,
the shares issuable under which are registered hereby.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Not required to be included in this Form S-8 Registration Statement pursuant to
introductory Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents which have been filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are incorporated herein by
reference:
(a) Prospectus filed pursuant to Rule 424(b) under the Securities
Act of 1933 (in connection with Registrant's Registration
Statement on Form S-1, as amended, filed on February 8, 2000 (File
No. 333-96421));
(b) All other reports filed pursuant to Sections 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended, ("Exchange Act")
since the end of the fiscal year covered by the document referred
to in (a) above; and
(c) Description of Common Stock of the Registrant contained or
incorporated in the registration statements filed by the
Registrant under the Exchange Act, including any amendments or
reports filed for the purpose of updating such description.
All documents subsequently filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities remaining unsold,
shall be deemed to be incorporated by reference into this Registration Statement
and to be a part of this Registration Statement from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by the Maryland General Corporation Law ("MGCL"),
Article Ninth, Paragraph (i) of the Registrant's Amended and Restated Charter
("Registrant's Charter") provides for indemnification of directors and officers
of the Registrant, as follows:
To the maximum extent permitted by the General Laws of the State of
Maryland, as from time to time amended, the Corporation shall indemnify
its currently acting and its former directors against any and all
liabilities and expenses incurred in connection with their services in
such capacities, shall indemnify its currently acting and its former
officers to the extent that
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<PAGE> 3
indemnification shall be provided to directors, and shall indemnify its
employees and agents and persons who serve and have served, at its
request as a director, officer, partner, trustee, employee or agent of
another corporation, partnership, joint venture or other enterprise. The
Corporation shall, also to the same extent, advance expenses to its
directors, officers and other persons, if any, and may by its by-laws,
resolution or agreement make further provision for indemnification of
directors, officers, employees and agents. No amendment or repeal of this
paragraph, or the adoption of any provision of the Corporation's charter
inconsistent with this paragraph, shall apply to or affect in any respect
the indemnification of any director or officer of the Corporation with
respect to any alleged act or omission which occurred prior to such
amendment, repeal or adoption.
Also, the Registrant's By-Laws contain indemnification procedures that
implement the indemnification provisions of the Registrant's Charter. The MGCL
permits a corporation to indemnify its directors and officers, among others,
against judgments, penalties, fines, settlements and reasonable expenses
actually incurred by them in connection with any proceedings to which they may
be a party by reason of their service in those or other capacities, unless it is
established that (a) the act or omission of the director or officer was material
to the matter giving rise to such proceedings and (i) was committed in bad faith
or (ii) was the result of active and deliberate dishonesty, (b) the director or
officer actually received an improper personal benefit in money, property or
services, or (c) in the case of any criminal proceedings, the director or
officer had reasonable cause to believe that the action or omission was
unlawful.
As permitted by the MGCL, Article Ninth, Paragraph (h) of the
Registrant's Charter provides for limitation of liability of directors and
officers of the Registrant, as follows:
To the maximum extent that limitations on the liability of directors and
officers are permitted by Maryland statutory or decisional law, as from
time to time amended or interpreted, no director or officer of the
Corporation shall have any personal liability to the Corporation or its
stockholders for money damages. This limitation on liability applies to
events occurring at the time a person serves as a director or officer at
the time of any proceeding in which liability is asserted. No amendment
or repeal of this paragraph, or the adoption of any provision of the
Corporation's charter inconsistent with this paragraph, shall limit or
eliminate the right to indemnification provided hereunder with respect to
acts or omissions occurring prior to such amendment or repeal.
The MGCL permits the charter of a Maryland corporation to include a
provision limiting the liability of its directors and officers to the
corporation and its stockholders for money damages, except to the extent that
(i) the person actually received an improper benefit or profit in money,
property or services or (ii) a judgment or other final adjudication is entered
in a proceeding based on a finding that the person's action, or failure to act,
was the result of active and deliberate dishonesty and was material to the cause
of action adjudicated in the proceeding.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
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<PAGE> 4
ITEM 8. EXHIBITS.
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<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
4.1 Amended and Restated Charter (incorporated by reference
to the exhibits to the Company's Registration Statement
on Form S-1 dated February 8, 2000 (File No. 333-96421),
as amended)
4.2 Amended and Restated By-Laws (incorporated by reference to
the exhibits to the Company's Registration Statement on
Form S-1 dated February 8, 2000 (File No. 333-96421), as
amended)
4.3 2000 Stock Incentive Plan (filed herewith)
5.1 Opinion of Piper Marbury Rudnick & Wolfe LLP, counsel for
the Registrant, regarding the legal validity of the shares
of Common Stock being registered for issuance under the
Plans (filed herewith)
23.1 Consent of Counsel (contained in Exhibit 5.1)
23.2 Consent of Ernst & Young LLP, Independent Auditors (filed herewith)
24.1 Power of Attorney (filed herewith)
</TABLE>
ITEM 9. UNDERTAKINGS.
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 this 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.
Paragraphs (1)(i) and (1)(ii) above do not apply if the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this 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.
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<PAGE> 5
(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.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 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
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Columbia, State of Maryland, on the 12th day of
May, 2000.
SEQUOIA SOFTWARE CORPORATION
By: /s/ RICHARD C. FAINT, JR.
------------------------------------
Richard C. Faint, Jr.
Chief Executive Officer and
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Form S-8
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ RICHARD C. FAINT, JR. Chief Executive Officer and May 12, 2000
- ----------------------------- Chairman of the Board
Richard C. Faint, Jr. (Principal Executive Officer)
/s/ GREGORY G. HEARD Chief Financial Officer, Vice President May 12, 2000
- ----------------------------- and Treasurer
Gregory G. Heard (Principal Financial Officer)
/s/ MARC E. RUBIN Chief Accounting Officer, Vice President May 12, 2000
- ----------------------------- and Secretary
Marc E. Rubin (Principal Accounting Officer)
</TABLE>
A majority of the Board of Directors (Richard C. Faint, Jr., Mark A.
Wesker, William M. Gust, II, Jonathan I. Grabel, Andrew J. Filipowski, Marvin W.
Adams, Lawrence A. Bettino and Richard R. Roscitt).
<TABLE>
<S> <C> <C>
Date: May 12, 2000 By: /s/ EDWIN M. MARTIN, JR.
--------------------------------------------
Edwin M. Martin, Jr. Attorney-In-Fact
</TABLE>
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<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
4.1 Amended and Restated Charter (incorporated by reference
to the exhibits to the Company's Registration Statement
on Form S-1 dated February 8, 2000 (File No. 333-96421),
as amended)
4.2 Amended and Restated By-Laws (incorporated by reference to
the exhibits to the Company's Registration Statement on
Form S-1 dated February 8, 2000 (File No. 333-96421), as
amended)
4.3 2000 Stock Incentive Plan (filed herewith)
5.1 Opinion of Piper Marbury Rudnick & Wolfe LLP, counsel for
the Registrant, regarding the legal validity of the shares
of Common Stock being registered for issuance under the
Plans (filed herewith)
23.1 Consent of Counsel (contained in Exhibit 5.1)
23.2 Consent of Ernst & Young LLP, Independent Auditors (filed herewith)
24.1 Power of Attorney (filed herewith)
</TABLE>
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<PAGE> 1
EXHIBIT 4.3
SEQUOIA SOFTWARE CORPORATION
2000 STOCK INCENTIVE PLAN
1. ESTABLISHMENT, PURPOSE AND TYPES OF AWARDS
SEQUOIA SOFTWARE CORPORATION, a Maryland corporation (the "Company"),
hereby establishes the SEQUOIA SOFTWARE CORPORATION 2000 STOCK INCENTIVE PLAN
(the "Plan"). The purpose of the Plan is to promote the long-term growth and
profitability of the Company by (i) providing key people with incentives to
improve stockholder value and to contribute to the growth and financial success
of the Company, and (ii) enabling the Company to attract, retain and reward the
best-available persons.
The Plan permits the granting of stock options (including incentive
stock options qualifying under Code section 422 and nonqualified stock
options), stock appreciation rights, restricted or unrestricted stock awards,
phantom stock, performance awards, other stock-based awards, or any combination
of the foregoing.
2. DEFINITIONS
Under this Plan, except where the context otherwise indicates, the
following definitions apply:
(a) "Affiliate" shall mean any entity, whether now or hereafter
existing, which controls, is controlled by, or is under common control with,
the Company (including, but not limited to, joint ventures, limited liability
companies, and partnerships). For this purpose, "control" shall mean ownership
of 50% or more of the total combined voting power or value of all classes of
stock or interests of the entity.
(b) "Award" shall mean any stock option, stock appreciation
right, stock award, phantom stock award, performance award, or other
stock-based award.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and any regulations promulgated thereunder.
(e) "Common Stock" shall mean shares of common stock of the
Company, par value of ($.001) per share.
(f) "Fair Market Value" shall mean, with respect to a share of
the Company's Common Stock for any purpose on a particular date, the value
determined by the Administrator in good faith. However, if the Common Stock is
registered under Section 12(b) of the Securities Exchange Act of 1934, as
amended, "Fair Market Value" shall mean, as applicable, (i) either the closing
price or the average of the high and low sale price on the relevant date, as
determined in the Administrator's discretion, quoted on the New York Stock
Exchange, the American Stock Exchange, or the Nasdaq National Market; (ii) the
last sale price on the relevant date quoted on the Nasdaq SmallCap Market;
(iii) the average of the high bid and low asked prices on the relevant date
quoted on the Nasdaq OTC Bulletin Board Service or by the National Quotation
Bureau, Inc. or a comparable service as determined in the Administrator's
discretion; or (iv) if the Common Stock is not quoted by any of the above, the
average of the closing bid and asked prices on the relevant date furnished by a
professional market maker for the Common Stock, or by such
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<PAGE> 2
other source, selected by the Administrator. If no public trading of the Common
Stock occurs on the relevant date, then Fair Market Value shall be determined
as of the next preceding date on which trading of the Common Stock does occur.
For all purposes under this Plan, the term "relevant date" as used in this
Section 2.1(f) shall mean either the date as of which Fair Market Value is to
be determined or the next preceding date on which public trading of the Common
Stock occurs, as determined in the Administrator's discretion.
(g) "Grant Agreement" shall mean a written document memorializing
the terms and conditions of an Award granted pursuant to the Plan and shall
incorporate the terms of the Plan.
3. ADMINISTRATION
(a) Administration of the Plan. The Plan shall be administered by
the Board or by such committee or committees as may be appointed by the Board
from time to time (the Board, committee or committees hereinafter referred to
as the "Administrator").
(b) Powers of the Administrator. The Administrator shall have all
the powers vested in it by the terms of the Plan, such powers to include
authority, in its sole and absolute discretion, to grant Awards under the Plan,
prescribe Grant Agreements evidencing such Awards and establish programs for
granting Awards.
The Administrator shall have full power and authority to take all
other actions necessary to carry out the purpose and intent of the Plan,
including, but not limited to, the authority to: (i) determine the eligible
persons to whom, and the time or times at which Awards shall be granted; (ii)
determine the types of Awards to be granted; (iii) determine the number of
shares to be covered by or used for reference purposes for each Award; (iv)
impose such terms, limitations, restrictions and conditions upon any such Award
as the Administrator shall deem appropriate; (v) modify, amend, extend or renew
outstanding Awards, or accept the surrender of outstanding Awards and
substitute new Awards (provided however, that, except as provided in Section
7(d) of the Plan, any modification that would materially adversely affect any
outstanding Award shall not be made without the consent of the holder); (vi)
accelerate or otherwise change the time in which an Award may be exercised or
becomes payable and to waive or accelerate the lapse, in whole or in part, of
any restriction or condition with respect to such Award, including, but not
limited to, any restriction or condition with respect to the vesting or
exercisability of an Award following termination of any grantee's employment or
other relationship with the Company; and (vii) establish objectives and
conditions, if any, for earning Awards and determining whether Awards will be
paid after the end of a performance period.
The Administrator shall have full power and authority, in its sole and
absolute discretion, to administer and interpret the Plan and to adopt and
interpret such rules, regulations, agreements, guidelines and instruments for
the administration of the Plan and for the conduct of its business as the
Administrator deems necessary or advisable.
(c) Non-Uniform Determinations. The Administrator's
determinations under the Plan (including without limitation, determinations of
the persons to receive Awards, the form, amount and timing of such Awards, the
terms and provisions of such Awards and the Grant Agreements evidencing such
Awards) need not be uniform and may be made by the Administrator selectively
among persons who receive, or are eligible to receive, Awards under the Plan,
whether or not such persons are similarly situated.
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<PAGE> 3
(d) Limited Liability. To the maximum extent permitted by law, no
member of the Administrator shall be liable for any action taken or decision
made in good faith relating to the Plan or any Award thereunder.
(e) Indemnification. To the maximum extent permitted by law and
by the Company's charter and by-laws, the members of the Administrator shall be
indemnified by the Company in respect of all their activities under the Plan.
(f) Effect of Administrator's Decision. All actions taken and
decisions and determinations made by the Administrator on all matters relating
to the Plan pursuant to the powers vested in it hereunder shall be in the
Administrator's sole and absolute discretion and shall be conclusive and
binding on all parties concerned, including the Company, its stockholders, any
participants in the Plan and any other employee, consultant, or director of the
Company, and their respective successors in interest.
4. SHARES AVAILABLE FOR THE PLAN
Subject to adjustments as provided in Section 7(d) of the Plan, the
shares of Common Stock that may be issued with respect to Awards granted under
the Plan shall not exceed an aggregate of 9,183,014 shares of Common Stock. The
Company shall reserve such number of shares for Awards under the Plan, subject
to adjustments as provided in Section 7(d) of the Plan. If any Award, or
portion of an Award, under the Plan expires or terminates unexercised, becomes
unexercisable or is forfeited or otherwise terminated, surrendered or canceled
as to any shares, or if any shares of Common Stock are surrendered to the
Company in connection with any Award (whether or not such surrendered shares
were acquired pursuant to any Award), or if any shares are withheld by the
Company, the shares subject to such Award and the surrendered and withheld
shares shall thereafter be available for further Awards under the Plan;
provided, however, that any such shares that are surrendered to or withheld by
the Company in connection with any Award or that are otherwise forfeited after
issuance shall not be available for purchase pursuant to incentive stock
options intended to qualify under Code section 422.
5. PARTICIPATION
Participation in the Plan shall be open to all employees, officers,
and directors of, and other individuals providing bona fide services to or for,
the Company, or of any Affiliate of the Company, as may be selected by the
Administrator from time to time. The Administrator may also grant Awards to
individuals in connection with hiring, retention or otherwise, prior to the
date the individual first performs services for the Company or an Affiliate
provided that such Awards shall not become vested prior to the date the
individual first performs such services.
6. AWARDS
The Administrator, in its sole discretion, establishes the terms of
all Awards granted under the Plan. Awards may be granted individually or in
tandem with other types of Awards. All Awards are
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<PAGE> 4
subject to the terms and conditions provided in the Grant Agreement. The
Administrator may permit or require a recipient of an Award to defer such
individual's receipt of the payment of cash or the delivery of Common Stock
that would otherwise be due to such individual by virtue of the exercise of,
payment of, or lapse or waiver of restrictions respecting, any Award. If any
such payment deferral is required or permitted, the Administrator shall, in its
sole discretion, establish rules and procedures for such payment deferrals.
(a) Stock Options. The Administrator may from time to time grant
to eligible participants Awards of incentive stock options as that term is
defined in Code section 422 or nonqualified stock options; provided, however,
that Awards of incentive stock options shall be limited to employees of the
Company or of any current or hereafter existing "parent corporation" or
"subsidiary corporation," as defined in Code sections 424(e) and (f),
respectively, of the Company. Options intended to qualify as incentive stock
options under Code section 422 must have an exercise price at least equal to
Fair Market Value as of the date of grant, but nonqualified stock options may
be granted with an exercise price less than Fair Market Value. No stock option
shall be an incentive stock option unless so designated by the Administrator at
the time of grant or in the Grant Agreement evidencing such stock option.
(b) Stock Appreciation Rights. The Administrator may from time to
time grant to eligible participants Awards of Stock Appreciation Rights
("SAR"). An SAR entitles the grantee to receive, subject to the provisions of
the Plan and the Grant Agreement, a payment having an aggregate value equal to
the product of (i) the excess of (A) the Fair Market Value on the exercise date
of one share of Common Stock over (B) the base price per share specified in the
Grant Agreement, times (ii) the number of shares specified by the SAR, or
portion thereof, which is exercised. Payment by the Company of the amount
receivable upon any exercise of an SAR may be made by the delivery of Common
Stock or cash, or any combination of Common Stock and cash, as determined in
the sole discretion of the Administrator. If upon settlement of the exercise of
an SAR a grantee is to receive a portion of such payment in shares of Common
Stock, the number of shares shall be determined by dividing such portion by the
Fair Market Value of a share of Common Stock on the exercise date. No
fractional shares shall be used for such payment and the Administrator shall
determine whether cash shall be given in lieu of such fractional shares or
whether such fractional shares shall be eliminated.
(c) Stock Awards. The Administrator may from time to time grant
restricted or unrestricted stock Awards to eligible participants in such
amounts, on such terms and conditions, and for such consideration, including no
consideration or such minimum consideration as may be required by law, as it
shall determine. A stock Award may be paid in Common Stock, in cash, or in a
combination of Common Stock and cash, as determined in the sole discretion of
the Administrator.
(d) Phantom Stock. The Administrator may from time to time grant
Awards to eligible participants denominated in stock-equivalent units ("phantom
stock") in such amounts and on such terms and conditions as it shall determine.
Phantom stock units granted to a participant shall be credited to a bookkeeping
reserve account solely for accounting purposes and shall not require a
segregation of any of the Company's assets. An Award of phantom stock may be
settled in Common Stock, in cash, or in a combination of Common Stock and cash,
as determined in the sole discretion of the Administrator. Except as otherwise
provided in the applicable Grant Agreement, the grantee shall not have the
rights of a stockholder with respect to any shares of Common Stock represented
by a phantom stock unit solely as a result of the grant of a phantom stock unit
to the grantee.
(e) Performance Awards. The Administrator may, in its discretion,
grant performance awards which become payable on account of attainment of one
or more performance goals established by
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<PAGE> 5
the Administrator. Performance awards may be paid by the delivery of Common
Stock or cash, or any combination of Common Stock and cash, as determined in
the sole discretion of the Administrator. Performance goals established by the
Administrator may be based on the Company's or an Affiliate's operating income
or one or more other business criteria selected by the Administrator that apply
to an individual or group of individuals, a business unit, or the Company or an
Affiliate as a whole, over such performance period as the Administrator may
designate.
(f) Other Stock-Based Awards. The Administrator may from time to
time grant other stock-based awards to eligible participants in such amounts,
on such terms and conditions, and for such consideration, including no
consideration or such minimum consideration as may be required by law, as it
shall determine. Other stock-based awards may be denominated in cash, in Common
Stock or other securities, in stock-equivalent units, in stock appreciation
units, in securities or debentures convertible into Common Stock, or in any
combination of the foregoing and may be paid in Common Stock or other
securities, in cash, or in a combination of Common Stock or other securities
and cash, all as determined in the sole discretion of the Administrator.
7. MISCELLANEOUS
(a) Withholding of Taxes. Grantees and holders of Awards shall
pay to the Company or its Affiliate, or make provision satisfactory to the
Administrator for payment of, any taxes required to be withheld in respect of
Awards under the Plan no later than the date of the event creating the tax
liability. The Company or its Affiliate may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to
the grantee or holder of an Award. In the event that payment to the Company or
its Affiliate of such tax obligations is made in shares of Common Stock, such
shares shall be valued at Fair Market Value on the applicable date for such
purposes.
(b) Loans. The Company or its Affiliate may make or guarantee
loans to grantees to assist grantees in exercising Awards and satisfying any
withholding tax obligations.
(c) Transferability. Except as otherwise determined by the
Administrator, and in any event in the case of an incentive stock option or a
stock appreciation right granted with respect to an incentive stock option, no
Award granted under the Plan shall be transferable by a grantee otherwise than
by will or the laws of descent and distribution. Unless otherwise determined by
the Administrator in accord with the provisions of the immediately preceding
sentence, an Award may be exercised during the lifetime of the grantee, only by
the grantee or, during the period the grantee is under a legal disability, by
the grantee's guardian or legal representative.
(d) Adjustments; Business Combinations.
(i) Upon a stock dividend of, or stock split or reverse
stock split affecting, the Common Stock of the Company, (A) the maximum number
of shares reserved for issuance or with respect to which Awards may be granted
under the Plan, as provided in Section 4 of the Plan, and (B) the number of
shares covered by and the exercise price and other terms of outstanding Awards,
shall, without further action of the Board, be adjusted to reflect such event
unless the Board determines, at the time it approves such stock dividend, stock
split or reverse stock split, that no such adjustment shall be made. The
Administrator may make adjustments, in its discretion, to address the treatment
of fractional shares and fractional cents that arise with respect to
outstanding Awards as a result of the stock dividend, stock split or reverse
stock split.
-5-
<PAGE> 6
(ii) In the event of any other changes affecting the
Company, the capitalization of the Company or the Common Stock of the Company
by reason of any spin-off, split-up, dividend, recapitalization, merger,
consolidation, business combination or exchange of shares and the like, the
Administrator, in its discretion and without the consent of holders of Awards,
shall make: (A) appropriate adjustments to the maximum number and kind of
shares reserved for issuance or with respect to which Awards may be granted
under the Plan, as provided in Section 4 of the Plan, and to the number, kind
and price of shares covered by outstanding Awards; and (B) any other
adjustments in outstanding Awards, including but not limited to reducing the
number of shares subject to Awards or providing or mandating alternative
settlement methods such as settlement of the Awards in cash or in shares of
Common Stock or other securities of the Company or of any other entity, or in
any other matters which relate to Awards as the Administrator shall, in its
sole discretion, determine to be necessary or appropriate.
(iii) Notwithstanding anything in the Plan to the contrary
and without the consent of holders of Awards, the Administrator, in its sole
discretion, may make any modifications to any Awards, including but not limited
to cancellation, forfeiture, surrender or other termination of the Awards in
whole or in part regardless of the vested status of the Award, in order to
facilitate any business combination that is authorized by the Board to comply
with requirements for treatment as a pooling of interests transaction for
accounting purposes under generally accepted accounting principles.
(iv) The Administrator is authorized to make, in its
discretion and without the consent of holders of Awards, adjustments in the
terms and conditions of, and the criteria included in, Awards in recognition of
unusual or nonrecurring events affecting the Company, or the financial
statements of the Company or any Affiliate, or of changes in applicable laws,
regulations, or accounting principles, whenever the Administrator determines
that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan and outstanding Awards.
(e) Substitution of Awards in Mergers and Acquisitions. Awards
may be granted under the Plan from time to time in substitution for Awards held
by employees, officers, consultants or directors of entities who become or are
about to become employees, officers, consultants or directors of the Company or
an Affiliate as the result of a merger or consolidation of the employing entity
with the Company or an Affiliate, or the acquisition by the Company or an
Affiliate of the assets or stock of the employing entity. The terms and
conditions of any substitute Awards so granted may vary from the terms and
conditions set forth herein to the extent that the Administrator deems
appropriate at the time of grant to conform the substitute Awards to the
provisions of the awards for which they are substituted.
(f) Termination, Amendment and Modification of the Plan. The
Board may terminate, amend or modify the Plan or any portion thereof at any
time.
(g) Non-Guarantee of Employment or Service. Nothing in the Plan
or in any Grant Agreement thereunder shall confer any right on an individual to
continue in the service of the Company or shall interfere in any way with the
right of the Company to terminate such service at any time with or without
cause or notice.
(h) No Trust or Fund Created. Neither the Plan nor any Award
shall create or be construed to create a trust or separate fund of any kind or
a fiduciary relationship between the Company and a grantee or any other person.
To the extent that any grantee or other person acquires a right to receive
payments from the Company pursuant to an Award, such right shall be no greater
than the right of any unsecured general creditor of the Company.
-6-
<PAGE> 7
(i) Governing Law. The validity, construction and effect of the
Plan, of Grant Agreements entered into pursuant to the Plan, and of any rules,
regulations, determinations or decisions made by the Administrator relating to
the Plan or such Grant Agreements, and the rights of any and all persons having
or claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the
State of Maryland, without regard to its conflict of laws principles.
(j) Effective Date; Termination Date. The Plan is effective as of
the date on which the Plan is adopted by the Board, subject to approval of the
stockholders within twelve months before or after such date. No Award shall be
granted under the Plan after the close of business on the day immediately
preceding the tenth anniversary of the effective date of the Plan, or if
earlier, the tenth anniversary of the date this Plan is approved by the
stockholders. Subject to other applicable provisions of the Plan, all Awards
made under the Plan prior to such termination of the Plan shall remain in
effect until such Awards have been satisfied or terminated in accordance with
the Plan and the terms of such Awards.
(k) Prior Options. Prior to the adoption of the Plan, the Company
granted nonqualified stock options for 7,895,646 shares of Common Stock. For
administrative purposes, those shares shall be subject to this Plan and are
included in the number of shares referred to in Section 4 of the Plan and
available for further Awards under the Plan. Notwithstanding the foregoing,
nothing herein shall be deemed to adversely affect the rights of individuals
under such prior grant agreements.
Date Approved by the Board: January 28, 2000
-----------------------------------------
Date Approved by the Stockholders: February 8, 2000
-----------------------------------------
-7-
<PAGE> 1
EXHIBIT 5.1
[PIPER MARBURY RUDNICK & WOLFE LLP LETTERHEAD]
May 15, 2000
Sequoia Software Corporation
5457 Twin Knolls Road
Columbia, Maryland 21045
Ladies and Gentlemen:
We have acted as counsel to Sequoia Software Corporation, a Maryland
Corporation (the "Company"), in connection with the preparation and filing with
the Securities and Exchange Commission of a registration statement on Form S-8
(the "Registration Statement") registering 9,183,013 shares of Common Stock, par
value $.001 per share, issuable pursuant to the exercise of options granted
under the 2000 Stock Incentive Plan (the "Plan Shares").
We have examined copies of the Company's Amended and Restated Charter,
Amended and Restated By-Laws, the Plan, all resolutions adopted by the Company's
Board of Directors relating to the above and other records and documents that we
have deemed necessary for the purpose of this opinion. We have also examined
such other documents, papers, statutes and authorities as we have deemed
necessary to form a basis for this opinion. In our examination, we have assumed
the genuineness of all signatures and the conformity to original documents of
all copies submitted to us. As to various questions of fact material to this
opinion, we have relied on statements and certificates of officers and
representatives of the Company and others.
Based upon the foregoing, we are of the opinion that Plan Shares issuable
under the Plan have been duly authorized and will be (when issued, sold and
delivered as authorized) validly issued, fully paid and non-assessable.
The opinions set forth herein are limited to matters governed by the laws
of the State of Maryland and the Federal Laws of the United States of America,
and we express no opinion as to any other laws.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement.
Very truly yours,
/s/ PIPER MARBURY RUDNICK & WOLFE LLP
<PAGE> 1
EXHIBIT 23.2
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333-______) pertaining to the 2000 Stock Incentive Plan of
Sequoia Software Corporation of our reports dated February 7, 2000 (except
Note 16, as to which the date is May 8, 2000), with respect to the consolidated
financial statements and schedule of Sequoia Software Corporation included in
Amendment No. 6 to the Registration Statement (Form S-1 No. 333-96421) and
related Prospectus dated May 11, 2000, filed with the Securities and Exchange
Commission.
/S/ ERNST & YOUNG LLP
Baltimore, Maryland
May 8, 2000
<PAGE> 1
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Officers and
Directors of Sequoia Software Corporation, Inc., a Maryland corporation (the
"Corporation"), hereby constitute and appoint Richard C. Faint, Jr., Mark A.
Wesker and Edwin M. Martin, Jr., and each of them, the true and lawful agents
and attorneys-in-fact of the undersigned with full power and authority in said
agents and attorneys-in-fact, and in any one or more of them, to sign for the
undersigned and in their respective names as Officers and as Directors of the
Corporation, a Registration Statement on Form S-8 (or other appropriate form)
relating to the proposed issuance of Common Stock and other securities pursuant
to the exercise of stock options granted under the 2000 Stock Incentive Plan (or
any and all amendments, including post-effective amendments, to such
Registration Statement) and file the same, with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange Commission,
and with full power of substitution; hereby ratifying and confirming all that
each of said attorneys-in-fact, or his substitute or substitutes, may do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ RICHARD C. FAINT, JR. Chief Executive Officer and May 12, 2000
- ---------------------------- Chairman of the Board of Directors
Richard C. Faint, Jr. (Principal Executive Officer)
/s/ GREGORY G. HEARD Chief Financial Officer, Vice President and May 12, 2000
- ---------------------------- Treasurer
Gregory G. Heard (Principal Financial Officer)
/s/ MARC E. RUBIN Chief Accounting Officer and Vice President May 12, 2000
- ---------------------------- (Chief Accounting Officer)
Marc E. Rubin
/s/ MARK A. WESKER President, Chief Operating Officer and May 12, 2000
- ---------------------------- Director
Mark A. Wesker
/s/ WILLIAM M. GUST II
- ---------------------------- Director May 12, 2000
William M. Gust II
/s/ JONATHAN I. GRABEL
- ---------------------------- Director May 12, 2000
Jonathan I. Grabel
/s/ ANDREW J. FILIPOWSKI
- ---------------------------- Director May 12, 2000
Andrew J. Filipowski
/s/ MARVIN W. ADAMS
- ---------------------------- Director May 12, 2000
Marvin W. Adams
</TABLE>
<PAGE> 2
<TABLE>
<S> <C> <C>
/s/ LAWRENCE A. BETTINO
- ---------------------------- Director May 12, 2000
Lawrence A. Bettino
/s/ RICHARD R. ROSCITT
- ---------------------------- Director May 12, 2000
Richard R. Roscitt
</TABLE>
