<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(AMENDMENT NO. 1)
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934 for the fiscal year ended July 31, 2000.
COMMISSION FILE NUMBER: 000-29365
VICINITY CORPORATION
(Exact name of Registrant as Specified in its Charter)
DELAWARE 77-0414631
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
370 SAN ALESO AVENUE
SUNNYVALE, CALIFORNIA 94085
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (408) 543-3000
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON STOCK, $0.001 PAR VALUE
Indicate by check mark whether the registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
[ X ] Yes [ ] No
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K/A. [ ]
The aggregate market value of the voting stock held by non-affiliates
of the registrant as of September 30, 2000 based on the closing sales price of
the registrant's common stock, as reported on the Nasdaq National Market, was
approximately $157,122,000. Shares of common stock held by each officer and
director have been excluded in that such persons may be deemed to be affiliates.
This determination of affiliate status is not necessarily a conclusive
determination for other purposes.
The number of shares of Common Stock, par value $0.001 per share, of
Vicinity Corporation outstanding as of November 22, 2000 was 28,608,702.
1
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EXPLANATORY NOTES
This Amendment No. 1 on Form 10-K/A is being filed by Vicinity
Corporation as an amendment to our Annual Report on Form 10-K for the fiscal
year ended July 31, 2000 to amend and restate in its entirety Part III.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
CERTAIN INFORMATION WITH RESPECT TO DIRECTORS
The following table sets forth certain information with respect to the
members of our Board of Directors as of November 22, 2000.
<TABLE>
<CAPTION>
NAME OF DIRECTOR AGE POSITION DIRECTOR SINCE CLASS
----------------------------- ------ --------------------------- ------------------- ------------------
<S> <C> <C> <C> <C>
Herbert M. Dwight, Jr. 70 Chairman of the Board of 1999 III
(1)(2) Directors
Emerick Woods 45 President, Chief 1998 III
Executive Officer and
Director
Jonathan Callaghan 31 Director 1997 I
Fred Gibbons (2) 51 Director 1995 I
Peter Mills (1) 49 Director 1996 III
Norman Nie (1) 57 Director 1998 II
Michael Sears (2) 43 Director 1998 II
Peter Ziebelman 44 Director 1997 II
</TABLE>
(1) Member of Compensation Committee
(2) Member of Audit Committee
HERBERT M. DWIGHT, JR. has served as Chairman of the Board of Directors
since October 1999. Mr. Dwight previously served in a number of positions for
Optical Coating Laboratory, Inc., a manufacturer of optical thin films,
including Chairman of the Board, from August 1991 until February 2000, President
from August 1991 to November 1997, Chief Executive Officer from August 1991 to
April 1998 and Chief Financial Officer from December 1993 to April 1995. Mr.
Dwight was Chairman, President and Chief Executive Officer of Superconductor
Technologies, Inc., a telecommunications technology company, from 1988 through
August 1991 and continued to served as Chairman from 1991 until May 1994. Mr.
Dwight holds a B.S. and an M.S. in Electrical Engineering from Stanford
University. Mr. Dwight is also a Director of Applied Materials, Inc., Applied
Magnetics Corporation and Advanced Fiber Communications, Inc.
EMERICK WOODS has served as our President and Chief Executive Officer since
August 1997 and as a Director since February 1998. From August 1996 to August
1997, Mr. Woods was the President and Chief Executive Officer of TuneUp.com,
Inc., an Internet based computing updating service. In May 1997, TuneUp.com
filed a voluntary petition for Chapter 11 bankruptcy, after which it was
reorganized and sold to Quarterdeck Corporation, a provider of software
utilities. From November 1994 to June 1997, Mr. Woods was a Vice President and
General Manager of Quarterdeck Corporation. Mr. Woods holds a B.S. in Computer
Science from Yale
2
<PAGE>
University and an M.B.A. from Harvard University. Mr. Woods is also a
Director of ClickAction, Inc., a provider of Internet marketing solutions.
JONATHAN CALLAGHAN has served as our Director since May 1997. Since May
1997, Mr. Callaghan has been a General Partner of CMG@Ventures, Inc., a
venture capital firm. From June 1991 to June 1995, Mr. Callaghan was an
associate of Summit Partners, a venture capital firm. Mr. Callaghan holds a
B.A. from Dartmouth College and an M.B.A. from Harvard University. Mr.
Callaghan is also a Director of Chemdex Corporation, Hotlinks Corporation,
Exp.com, Inc. and several private companies.
FRED GIBBONS has served as a Director of Vicinity Corporation since October
1995. From October 1995 to October 1999, Mr. Gibbons was the Chairman of our
Board of Directors. From 1995 to 1999, Mr. Gibbons was a Lecturer at Stanford
University's Graduate School of Engineering. Since 1994, Mr. Gibbons has been
the principal of Venture-Concept.com, a concept stage venture management firm.
Mr. Gibbons holds a B.S. degree in Science Engineering and a M.S. degree in
Computer Engineering from the University of Michigan and a M.B.A. degree from
Harvard University. Mr. Gibbons is also a Director of MIPS Technologies, Inc.,
Inverse Networks, Inc. and several private companies.
PETER MILLS has served as a Director since February 1996. Since March
1995, Mr. Mills has been a General partner of CMG@Ventures, Inc. a venture
capital firm. From March 1992 to March 1994, Mr. Mills was the Chief
Executive Officer of the United States Display Consortium, a non-profit
consortium for the development of flat panel displays. Mr. Mills holds a B.S.
from Ithaca College and an M.B.A. from Columbia University.
NORMAN NIE has served as a Director since December 1998. Since 1997, Mr.
Nie has been a Technology Partner of Oak Investments, a venture capital firm.
From 1975 to 1991, Mr. Nie was the Chief Executive Officer of SPSS, Inc., a
provider of statistical software and service solutions. Mr. Nie holds a B.A.
from the University of Washington and an M.A. and a Ph.D from Stanford
University. Mr. Nie is also a director of SPSS, Inc. and several private
companies.
MICHAEL SEARS has served as a Director since June 1998. Mr. Sears is
currently the General Manager of a division of Digeo Broadband Inc., a
broadband digital services provider. From March 2000 to September 2000, Mr.
Sears was a consultant to Black Pearl Software, Inc., a provider of Internet
enterprise software tools. From 1999 to March 2000, Mr. Sears was the
President and Chief Executive Officer of Black Pearl Software, Inc. From 1997
to 1999, Mr. Sears was the General Manager of Spyglass, Inc., a provider of
Internet connectivity solutions. From 1996 to 1997, Mr. Sears was an
independent consultant, and from 1990 to 1996, Mr. Sears was a General
Manager of Sun Microsystems, Inc. Mr. Sears holds a B.S. from the United
States Naval Academy, and a J.D. and an M.B.A. from Stanford University.
PETER ZIEBELMAN has served as a Director since June 1997. Mr. Ziebelman is
a Founding Partner of 21st Century Internet Venture Partners, a venture capital
firm. From 1988 to October 1996, Mr. Ziebelman was a Partner of Thompson Clive
Venture Capital, an international venture capital firm. Mr. Ziebelman holds a
B.S. in Computer Science and Psychology from Yale University, and an M.S. in
Management from Stanford University.
3
<PAGE>
CERTAIN INFORMATION WITH RESPECT TO EXECUTIVE OFFICERS
The executive officers of our company as of November 22, 2000 are as
follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
--------------------------------------- ------------ ------------------------------------------------------------
<S> <C> <C>
Emerick Woods 45 President and Chief Executive Officer, Director
Scott Young 41 Senior Vice President, Products and Strategy, Chief
Technology Officer
Dinesh Wadhawan 42 Senior Vice President, Worldwide Sales
Mary Gavin 43 Vice President, Engineering
Eric Winkler 34 Vice President, Marketing
David Cherner 36 Vice President and General Manager, Syndication
Scott Sullivan 37 Vice President, Human Resources
Mike Torgersen 57 Vice President, Information Technology and Chief
Information Officer
Scott Shuda 34 General Counsel and Secretary
</TABLE>
The principal occupations and positions for the past five years, and in
some cases prior years, of the executive officers named above, are as follows:
EMERICK WOODS has served as our President and Chief Executive Officer since
August 1997 and as a Director since February 1998. From August 1996 to August
1997, Mr. Woods was the President and Chief Executive Officer of TuneUp.com,
Inc., an Internet based computing updating service. In May 1997, TuneUp.com
filed a voluntary petition for Chapter 11 bankruptcy, after which it was
reorganized and sold to Quarterdeck Corporation, a provider of software
utilities. From November 1994 to June 1997, Mr. Woods was a Vice President and
General Manager of Quarterdeck Corporation. Mr. Woods holds a B.S. in Computer
Science from Yale University and an M.B.A. from Harvard University. Mr. Woods is
also a Director of ClickAction, Inc., a provider of Internet marketing
solutions.
SCOTT YOUNG has served as our Senior Vice President, Products and Strategy
and Chief Technology Officer since June 2000. From October 1997 to June 2000,
Mr. Young was our Senior Vice President, Operations, and from October 1996 to
October 1997, Mr. Young was our Director of Operations. From February 1994 to
October 1996, Mr. Young was the Vice President of Sales and Marketing of
Infrastructures for Information, Inc., a provider of integrated information
management systems software. From August 1989 to October 1994, Mr. Young was the
Director of Technology and Government Relations for Semiconductor Equipment and
Materials International, an industry consortium for the semiconductor industry.
Mr. Young holds a B.A. and a J.D. from the University of Kansas.
DINESH WADHAWAN has served as our Vice President, Worldwide Sales since
September 2000. From March 1999 to August 2000, Mr. Wadhawan served as our Vice
President, Sales. From October 1995 to March 1999, Mr. Wadhawan was the Director
of Operations, Western North America of Systems Union, Inc., a provider of
international business and financial software. From January 1994 to September
1995, Mr. Wadhawan was the Global Manager, Oil and Gas, of Systems Union
Limited, the United Kingdom component of Systems Union. Mr. Wadhawan holds a
B.S. and a Post Graduate Diploma in Business Management from the University of
Delhi, India.
MARY GAVIN has served as our Vice President, Engineering since August 1999.
From October 1997 to August 1999, Ms. Gavin was our Director of Engineering
Projects. From March 1997 to October 1997, Ms. Gavin was our Project Manager. In
1996, Ms. Gavin was a Marketing Manager of NetRights, LLC, a start-up Internet
company. In 1995, Ms. Gavin was a Support and Training Manager of Codman
Research Group, a developer of decision support systems for the health care
industry. Ms. Gavin holds a B.A. from Ripon College.
ERIC WINKLER has served as our Vice President, Marketing since January
1999. From 1998 to 1999, Mr. Winkler was a Director of Consumer Marketing for
the consumer software division of IBM. From 1994 to 1998, Mr. Winkler was a
Marketing and Communications Department Manager and then Director for Broderbund
Software, a software publisher. Mr. Winkler holds a B.A. from the Allen School
of Advertising at the University of Oregon.
DAVID CHERNER has served as our Vice President and General Manager,
Syndication since April 1999, which position was formerly titled Vice
President and General Manager, MapBlast! From October 1997 through April
1999, Mr. Cherner was a management consultant to several early-stage Internet
companies, including Third Age Media, eWork Exchange and Vicinity. During
that time, Mr. Cherner also served as Vice President of the Panterra Group, a
management consulting organization. In February 1996, Mr. Cherner founded
i-Health, Inc., an Internet health content community, where he served as
President and Chief Executive Officer until September 1997. From 1994 to
1996, Mr. Cherner was a senior manager, business development of Access
Health, Inc., an information services company. Mr. Cherner holds a B.A. in
Economics from Emory University and an M.B.A. from the Haas School of
Business at the University of California, Berkeley.
4
<PAGE>
SCOTT SULLIVAN has served as our Vice President, Human Resources since
October 2000. From April 2000 to September 2000, Mr. Sullivan was a Senior
Principal at Diamond Technology Partners, a business operations firm focused
on developing successful new companies. From July 1994 to March 2000, Mr.
Sullivan was a Managing Consultant at Towers Perrin, a management consulting
firm. Mr. Sullivan holds a B.S. in Chemistry and Engineering from the United
States Military Academy, West Point, and an M.B.A. from Harvard Business
School.
MIKE TORGERSEN has served as our Vice President, Information Technology
and Chief Information Officer since September 2000. From August 1999 until
August 2000, Mr. Torgersen served as our Director of Information Technology.
From September 1998 to June 1999, Mr. Torgersen was the Vice President,
Operations at SocialNet, a Silicon Valley startup. From July 1997 to
September 1998, Mr. Torgersen was the Vice President, Operations at
Communities.com, another Silicon Valley startup. Mr. Torgersen holds a B.S.
from the University of Illinois, College of Engineering and an M.B.A. from
the University of Chicago, Graduate School of Business.
SCOTT SHUDA has served as our General Counsel and Secretary since May 1999.
From May 1998 to May 1999, Mr. Shuda was a corporate associate in the Silicon
Valley office of the law firm of Latham & Watkins. From September 1996 to May
1998, Mr. Shuda was a corporate associate in the law firm of O'Sullivan, Graev &
Karabell in New York. From September 1994 to August 1996, Mr. Shuda was a
corporate associate in the law firm of Roger & Wells in New York. Mr. Shuda
holds a B.A., an M.B.A. and a J.D. from Georgetown University.
COMPLIANCE WITH SECTION 16(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires that our executive officers and
directors, and persons who own more than ten percent of a registered class of
our equity securities, file reports of ownership and changes in ownership (Forms
3, 4 and 5) with the Securities and Exchange Commission. Executive officers,
directors and greater-than-ten-percent holders are required to furnish us with
copies of all of these forms which they file.
Based solely on our review of these reports or written representations from
certain reporting persons, we believe that during the fiscal year ended July 31,
2000, all filing requirements applicable to our officers, directors,
greater-than-ten-percent beneficial owners and other persons subject to Section
16(a) of the Exchange Act were met.
5
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The following table provides for the periods shown summary information
concerning compensation paid or accrued by us to or on behalf of our Chief
Executive Officer and each of our four highest paid executive officers
(collectively referred to as the "named executive officers") plus one
additional individual for whom disclosure would have been provided but for
the fact that the individual was not serving as an executive officer at the
end of our last fiscal year.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
FISCAL ----------------------------------------------- -----------------
YEAR OTHER ANNUAL SECURITIES
NAME AND PRINCIPAL ENDED COMPENSATION UNDERLYING ALL OTHER
POSITION JULY 31, SALARY ($) BONUS ($) ($)(1) OPTIONS/SAR (#)(2) COMPENSATION ($)
-------------------------------- -------- ------------ ------------ ------------------- ------------------ ------------------
<S> <C> <C> <C> <C> <C> <C>
Emerick Woods 2000 $222,917 $120,000 -- 150,000 $33,000 (3)
President, Chief Executive 1999 200,000 100,000 -- -- $33,000 (3)
Officer and Director
Howard Bain 2000 $106,443(4) $100,000 -- -- --
Executive Vice President and
Chief Financial Officer
Scott Young 2000 $145,000 $37,500 -- 40,000 --
Senior Vice President, 1999 130,000 30,000 -- 190,000 --
Products and Strategy,
Chief Technology Officer
Dinesh Wadhawan 2000 $158,333 $126,000 $62,500 45,000 --
Senior Vice President, 1999 50,577 8,333 -- 225,000 --
Worldwide Sales
Eric Winkler 2000 $143,750 $37,500 -- 25,000 --
Vice President, Marketing 1999 69,500 -- -- -- --
Mark Friend 2000 $88,333 $26,500 $130,655 17,250 --
Director, Strategic Accounts 1999 78,205 50,341 12,784 33,750 --
</TABLE>
6
<PAGE>
(1) Excludes perquisites and other personal benefits, securities or property
aggregating less than $50,000 or 10% of the total annual salary and bonus
reported for each person.
(2) The securities underlying the options are shares of common stock.
(3) Consists of housing expenses paid by us on behalf of Mr. Woods.
(4) Represents Mr. Bain's salary for the period beginning March 2000, when he
joined our company, through the end of the fiscal year.
During the periods indicated above, none of the named executive
officers, or other person listed on the table, received any awards under any
long-term incentive plan, and we do not have a pension plan.
EMPLOYMENT AGREEMENTS
On November 17, 2000, Howard Bain resigned from his position as
Executive Vice President and Chief Financial Officer of our company. In
connection with Mr. Bain's resignation, he agreed to make himself available,
as reasonably requested by us, to perform consulting services to our company
for a period of one year following his resignation and we agreed to pay Mr.
Bain an amount equal to $225,000 and allowed him to purchase 50,000 shares of
common stock for nominal consideration under our 2000 Equity Participation
Plan. In addition, we agreed to make COBRA payments on Mr. Bain's behalf for
a period of one year following his resignation. The agreement also includes
other customary terms, including a general release by Mr. Bain and
confirmation that he has resigned from any officer or director positions held
by him at our company's subsidiaries.
STOCK OPTION ACCELERATION RIGHTS OF EXECUTIVE OFFICERS
We have entered into agreements with a number of our executive officers
providing that up to 25% of their stock options will become immediately vested
in the event of specified merger or reorganization transactions. In addition, we
have entered into an agreement with Mr. Woods providing that 100% of the
150,000 shares granted to him during fiscal year 2000 will become immediately
vested and exercisable upon the occurrence of specific merger or reorganization
transactions.
OPTION GRANTS IN THE FISCAL YEAR ENDED JULY 31, 2000
In the fiscal year ended July 31, 2000, we granted options to
purchase 1,982,750 shares of common stock under our 1996 Stock Option Plan
and our 2000 Equity Participation Plan and during that year options granted
for 56,480 shares were cancelled and returned to the plans. Options granted
to the named executive officers in the fiscal year ended July 31, 2000 are
set forth in the table below.
We grant options to our executive officers under our 2000 Equity
Participation Plan. As of November 22, 2000, options to purchase a total of
1,419,200 shares were outstanding under our 2000 Equity Participation Plan
and 453,778 shares remained available for grant under the plan. In general,
options granted under our 2000 Equity Participation Plan vest over four years
and expire on the tenth anniversary of the date of grant.
The following tables show for the fiscal year ended July 31, 2000,
certain information regarding options granted to, exercised by, and held at year
end by our named executive officers:
7
<PAGE>
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------
% OF TOTAL POTENTIAL REALIZABLE VALUE
NUMBER OF OPTIONS AT ASSUMED ANNUAL RATES OF
SECURITIES GRANTED TO EXERCISE STOCK PRICE APPRECIATION
UNDERLYING EMPLOYEES OF BASE FOR OPTION TERM (1)
OPTIONS IN THE PRICE --------------------------
NAME GRANTED (#) FISCAL YEAR ($/SH) (2) EXPIRATION DATE 5% ($) 10% ($)
---- ----------- ----------- ---------- --------------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Emerick Woods 150,000 7.6% $12.00 January 24, 2010 $1,132,010 $2,868,736
Howard Bain(3) 350,000 17.7% $17.00 February 8, 2010 $3,741,923 $9,482,768
Scott Young 40,000 2.0% $12.00 January 24, 2010 $301,869 $764,996
Dinesh Wadhawan 20,000 1.0% $12.00 January 24, 2010 $150,935 $382,498
25,000 1.3% $40.50 March 1, 2010 $636,756 $1,613,664
Eric Winkler 25,000 1.3% $12.00 January 24, 2010 $188,668 $478,123
</TABLE>
(1) Reflects the value of the stock option on the date of grant assuming (i) for
the 5% column, a five-percent annual rate of appreciation in our common
stock over the ten-year term of the option and (ii) for the 10% column, a
ten-percent annual rate of appreciation in our common stock over the
ten-year term of the option, in each case without discounting to net present
value and before income taxes associated with the exercise. The 5% and 10%
assumed rates of appreciation are based on the rules of the Securities and
Exchange Commission and do not represent our estimate or projection of the
future price of our common stock. The amounts in this table may not
be achieved.
(2) All options were granted at the fair market value of our common stock at
the date of grant.
(3) Mr. Bain's option to purchase 350,000 shares of our common stock was
canceled in connection with his November 17, 2000 resignation.
AGGREGATE OPTION EXERCISES IN THE FISCAL YEAR ENDED JULY 31, 2000; FISCAL
YEAR ENDED JULY 31, 2000 YEAR-END OPTION VALUES
The following table sets forth, on an aggregated basis, information
regarding securities underlying unexercised options during the fiscal year ended
July 31, 2000 by our named executive officers. The value of in-the-money options
is based on the fair market value of our common stock at close of market on July
31, 2000 of $19.88 per share and is net of the exercise price:
<TABLE>
<CAPTION>
OPTION VALUES AT JULY 31, 2000
------------------------------------------------------------
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
YEAR-END (1) (#) FISCAL YEAR-END ($)
SHARES ACQUIRED VALUE REALIZED ---------------------------- ------------------------------
NAME AT EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------------------- ---------------- --------------- ------------ -------------- ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Emerick Woods........ -- -- -- 150,000 -- $1,181,250
Howard Bain.......... -- -- -- 350,000 -- $1,006,250
Scott Young.......... 190,000 $1,881,000 -- 40,000 -- $315,000
Dinesh Wadhawan...... 225,000 $562,500 -- 45,000 -- $157,500
Eric Winkler......... -- -- -- 25,000 -- $196,875
</TABLE>
-----------------------
(1) The securities underlying the options are shares of our common stock.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
At the end of the fiscal year ended July 31, 2000, the compensation
committee consisted of Messrs. Dwight (appointed October 13, 1999), Nie and
Mills (who replaced Mr. Ziebelman on March 23, 2000), none of whom (1) is a
8
<PAGE>
present or former officer or employee of our company, or (2) is engaged in
any transactions described in Item 13. "Certain Relationships And Related
Party Transactions."
DIRECTOR COMPENSATION
Those members of our Board of Directors who are not also our employees
do not receive any compensation for attending a meeting of the Board of
Directors or a meeting of a committee of the Board of Directors. All of our
directors are reimbursed for reasonable out-of-pocket expenses arising from
their attendance at any meetings. Our 2000 Equity Participation Plan provides
for the grant of options to our non-employee directors on the date of each
annual meeting following which he will continue to serve on our Board of
Directors. On that date, each non-employee director will be granted a
non-statutory option to purchase 5,000 shares of our common stock, which option
will vest over four years at the rate of 1/48th of the shares subject to the
option per month.
Accordingly, each of Messrs. Dwight, Mills, Nie, Sears, Ziebelman and,
if elected to our Board of Directors at our annual stockholders' meeting, Mr.
Gibbons, will be granted an option to purchase 5,000 shares of our common stock.
All options granted to non-employee directors have a per share exercise price
equal to the fair market value of a share of our common stock on the date prior
to the date of the grant.
9
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information in the following table sets forth the ownership of our
common stock, as of November 22, 2000, by (i) each person who, to our knowledge,
beneficially owns more than 5% of the outstanding shares of our common stock;
(ii) each named executive officer (as listed in the summary compensation table);
(iii) each of our directors; and (iv) all of our directors and executive
officers, as a group. As of November 22, 2000, we had 28,608,702 shares of
common stock outstanding.
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES COMMON STOCK
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED (1) BENEFICIALLY OWNED (1)
------------------------------------ ---------------------- ----------------------
<S> <C> <C>
CMG@Ventures Capital Corporation (2) 4,895,230 17.1%
Oak Investment Partners (3) 3,463,994 12.1%
21st Century Internet Fund, L.P. (4) 950,000 3.3%
Emerick Woods (5) 827,253 2.9%
Howard Bain 50,000 *
Scott Young 240,000 *
Dinesh Wadhawan 225,000 *
Eric Winkler 125,000 *
Herbert M. Dwight, Jr. 210,000 *
Jon Callaghan (6) 4,908,298 17.1%
Fred Gibbons (7) 108,576 *
Peter Mills (8) 5,245,530 17.1%
Norman Nie 31,905 *
Michael Sears 20,000 *
Peter Ziebelman (4) 950,000 3.3%
All Named Executive Officers and Directors as a Group 8,046,332 28.1%
(13 persons)
</TABLE>
10
<PAGE>
* Represents less than 1% of the issued and outstanding shares.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of common stock
subject to options and warrants which are currently exercisable, or will
become exercisable within 60 days of November 22, 2000, are deemed
outstanding for computing the percentage of the person or entity holding
such securities but are not outstanding for computing the percentage of
any other person or entity. Except as indicated by footnote, and subject
to the community property laws where applicable, to our knowledge the
persons named in the table above have sole voting and investment power
with respect to all shares of common stock shown as beneficially owned by
them. Unless otherwise indicated, the address for each person is 370
San Aleso Avenue, Sunnyvale, California 94085.
(2) Consists of 4,590,058 shares held by CMG@Ventures Capital Corporation,
an affiliate of CMG@Ventures, Inc., 46,364 shares held by CMG@Ventures,
Inc., 257,205 shares held by CMG@Ventures I, LLC, an affiliate of
CMG@Ventures, Inc., and 1,603 shares held by CMG@Ventures II, LLC, an
affiliate of CMG@Ventures, Inc. Excludes 363,368 shares held by
Messrs. Callaghan and Mills in their personal capacities.
(3) Consists of 3,381,667 shares held by Oak Investment Partners VIII, L.P.
and 82,327 shares held by Oak VIII Affiliates Fund, L.P., both affiliates
of Oak Investment Partners. Excludes 31,905 shares held by Norman Nie, one
of our Directors and a limited partner of Oak VIII Affiliates Fund, L.P.
(4) Consists of 950,000 shares held by 21st Century Internet Fund, L.P., an
affiliate of 21st Century Internet Management Partners, LLC. Mr. Ziebelman
is a General Partner of 21st Century Internet Management Partners, LLC,
and may be deemed to have voting and investment powers over these shares.
Mr. Ziebelman disclaims beneficial ownership in these shares, except to
the extent of his interest in 21st Century Internet Management Partners,
LLC.
(5) Excludes 127,884 shares held by two trusts for the benefit of Mr. Woods'
children over which Mr. Woods does not maintain voting or investment
power. Mr. Woods disclaims beneficial ownership of the shares held in
these two trusts.
(6) Consists of 13,068 shares held by Mr. Callaghan, 4,590,058 shares held by
CMG@Ventures Capital Corporation, an affiliate of CMG@Ventures, Inc.,
46,364 shares held by CMG@Ventures, Inc., 257,205 shares held by
CMG@Ventures I, LLC, an affiliate of CMG@Ventures, Inc., and 1,603 shares
held by CMG@Ventures II, LLC, an affiliate of CMG@Ventures, Inc. Mr.
Callaghan is a General Partner of CMG@Ventures, Inc. and may be deemed to
have voting and investment powers over the shares held by CMG@Ventures,
Inc. and its affiliates. Mr. Callaghan disclaims beneficial ownership of
such shares, except to the extent of his interest in CMG@Ventures, Inc.,
CMG@Ventures Capital Corporation, CMG@Ventures I and CMG@Ventures II.
(7) All shares are held by a trust with respect to which Mr. Gibbons maintains
sole voting power.
(8) Consists of 350,300 shares held by Mr. Mills, 4,590,058 shares held by
CMG@Ventures Capital Corporation, an affiliate of CMG@Ventures, Inc.,
46,364 shares held by CMG@Ventures, Inc., 257,205 shares held by
CMG@Ventures I, LLC, an affiliate of CMG@Ventures, Inc. and 1,603 shares
held by CMG@Ventures II, LLC, an affiliate of CMG@Ventures, Inc. Mr. Mills
is a General Partner of CMG@Ventures, Inc. and may be deemed to have
voting and investment powers over the shares held by CMG@Ventures, Inc.
and its affiliates. Mr. Mills disclaims beneficial ownership of such
shares, except to the extent of his interest in CMG@Ventures, Inc.,
CMG@Ventures Capital Corporation, CMG@Ventures I and CMG@Ventures II.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
CMGI INC.
CMG@Ventures Capital Corporation, our largest stockholder, is an
affiliate of CMGI Inc ("CMGI"). CMGI is a global Internet operating and
development company with a network of approximately 70 operating subsidiaries
and venture capital funded affiliates. We have entered into business
relationships with several of CMGI's subsidiaries and affiliates. These
companies include, NaviSite Internet Services Corporation ("NaviSite"),
Koz.com, Inc. ("Koz"), AltaVista Company ("AltaVista"), MyWay.com Corporation
("MyWay"), Engage Technologies, Inc. ("Engage"), eCircles, Inc. ("eCircles"),
YesMail.com, Inc. ("YesMail"), and Lycos, Inc. ("Lycos").
We entered into various service agreements with NaviSite pursuant to
which NaviSite agreed to host a portion of our data center equipment and to
provide Internet connections and we agreed to pay NaviSite various setup and
service fees. The last of these agreements expired in December 1999.
In July 1999, we entered into a service agreement with Koz pursuant to
which we provide our directory services, maps, and driving directions for an
annual license fee.
In December 1999, we entered into an Interactive Service Agreement with
AltaVista Internet Operations Limited (UK), an affiliate of AltaVista, pursuant
to which we agreed to provide maps and driving directions to Alta Vista's U.K.
web site in exchange for a percentage of the revenue generated on pages
displaying our content and services.
In January 2000, we entered into an agreement with AltaVista pursuant
to which we agreed to provide our BrandFinder services to AltaVista's web site.
During the initial term of this agreement, the parties will share revenue
generated on pages providing our BrandFinder services.
In January 2000, we entered into a service and license agreement with
MyWay pursuant to which we agreed to provide MyWay's web site with our directory
services for an annual license fee.
In February 2000, we entered into a strategic relationship with Engage
pursuant to which we provide Engage with web users' anonymous geographic data to
be integrated into Engage's end-user profiles and pursuant to which Engage and
its agents agreed to sell our advertising inventory to media buyers in exchange
for a share of the revenue generated from the sale.
In February 2000, we entered into a service and license agreement with
eCircles pursuant to which we agreed to provide domestic maps and driving
directions to eCircles for an annual license fee.
In March 2000, we entered into a network partner agreement with YesMail
pursuant to which we agreed to integrate YesMail's email campaign service into
our personalized services available on our web site located at mapblast.com in
exchange for a share of the revenue generated from this service.
In May 2000, we entered into an agreement with Lycos pursuant to which
we provide international and domestic maps and driving directions to Lycos in
exchange for a license fee and pursuant to which we provide BrandFinder services
in exchange for a share of the revenue generated from that service. We have also
agreed to provide our services on the Lycos wired and wireless platforms.
In July 2000, we entered into a license and service agreement with
AltaVista pursuant to which AltaVista licensed our geocoding software and maps
and driving directions.
We believe that each of the foregoing transactions was on terms no less
favorable to us than we could have obtained from independent third parties.
CLICKACTION INC.
In November 1999, we entered into a license agreement with ClickAction
Inc. ("ClickAction") pursuant to which we license software from ClickAction. In
December 1999, we paid an aggregate of $250,000 in license fees under this
license agreement. Mr. Woods is a Director of ClickAction.
We believe that this transaction was on terms no less favorable to
us than we could have obtained from independent third parties.
INDEMNITY AGREEMENTS
We entered into indemnity agreements with our directors and certain of
our officers which provide, among other things, that we will indemnify such
officer or director, under the circumstances and to the extent provided for
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therein, for damages, judgments, fines, penalties, settlements and costs,
attorneys' fees and disbursements and costs of attachment or similar bonds,
investigations and any expenses of establishing a right to indemnification under
such agreement, which such person becomes legally obligated to pay in connection
with any threatened, pending, or completed claim, action, suit or proceeding,
whether brought by or in the right of our company or otherwise and whether of a
civil, criminal, administrative or investigative nature, in which such person
may be or may have been involved as a party or otherwise, by reason of the fact
that such person is or was, or has agreed to become, a director or officer of
our company, by reason of any actual or alleged error or misstatement or
misleading statement made or suffered by such person, by person of any action
taken by them or of any inaction on their part while acting as such director or
officer, or by reason of the fact that he was serving at our request as a
director, trustee, officer, employee or agent of our company, or another entity.
LOAN AGREEMENTS
In July 1999, we loaned approximately $96,000 to Emerick Woods, our
President and Chief Executive Officer, to enable Mr. Woods to exercise options
to purchase shares of our common stock. This recourse loan bears interest at a
rate equal to 8 1/4% and is payable by Mr. Woods on the first to occur of the
following:
- 18 months after an initial public offering of our common stock;
- 30 days after the sale of our company;
- 90 days after the termination of Mr. Woods' employment; and
- July 2004.
In October 1999, we loaned approximately $113,000 to Dinesh
Wadhawan, our Vice President, Sales, to enable Mr. Wadhawan to exercise options
to purchase shares of our common stock. In December 1999, and then in October
2000, we increased the amount of this loan to approximately $135,000 and
$245,000, respectively, to assist Mr. Wadhawan in paying taxes relating to the
exercise of his option. This recourse loan bears interest at a rate equal to 8
1/4% and is payable by Mr. Wadhawan on the first to occur of the following:
- 18 months after an initial public offering of our common stock;
- 30 days after the sale of our company;
- 90 days after the termination of Mr. Wadhawan's employment; and
- October 2004.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Vicinity Corporation
(Registrant)
By: /s/ Scott A. Shuda
----------------------------
Secretary
Date: November 28, 2000
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