<PAGE> 1
As filed with the Securities and Exchange Commission on December 30, 1997
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
BEST SOFTWARE, INC.
- --------------------------------------------------------------------------------
(Exact Name of Issuer as Specified in Its Charter)
Virginia 54-1222526
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11413 Isaac Newton Square, Reston, Virginia 20190
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Employee Incentive Stock Option Plan
Amended and Restated 1992 Stock Option Plan
1997 Employee Stock Purchase Plan
1997 Stock Incentive Plan
1997 Director Stock Option Plan
----------------------------------------
(Full Title of the Plans)
Timothy A. Davenport
Best Software, Inc.
11413 Isaac Newton Square
Reston, Virginia 20190
----------------------------------------
(Name and Address of Agent for Service)
(703) 709-5200
----------------------------------------
(Telephone Number, including Area Code, of Agent for Service)
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount Of
To Be To Be Price Offering Registration
Registered Registered Per share Price Fee
- ---------- ---------- --------- --------- ------------
<S> <C> <C> <C> <C>
Common Stock, 2,904,653 $ 9.44 (2) $27,419,924 $8,088.88
no par value shares(1)
</TABLE>
- --------------------
(1) 145,500 shares will be offered by the Registrant pursuant to its Employee
Incentive Stock Option Plan, 859,153 shares will be offered by the Registrant
pursuant to its Amended and Restated 1992 Stock Option Plan, 250,000 shares will
be offered by the Registrant pursuant to its 1997 Employee Stock Purchase Plan,
1,500,000 shares will be offered by the Registrant pursuant to its 1997 Stock
Incentive Plan and 150,000 shares will be offered by the Registrant pursuant to
its 1997 Director Stock Option Plan. The Registration Statement also covers such
indeterminable number of additional shares as may become issuable to prevent
dilution in the event of stock splits, stock dividends or similar transactions
pursuant to the terms of such Plans.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rules 457(c) and 457(h) under the Securities Act of 1933, as
amended, based on the average of the high and low price of the Registrant's
Common Stock on the Nasdaq National Market on December 26, 1997.
2
<PAGE> 3
PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The information required by Part I of Form S-8 is included in
documents sent or given to participants in the Employee Incentive Stock Option
Plan, the Amended and Restated 1992 Stock Option Plan, 1997 Employee Stock
Purchase Plan, the 1997 Stock Incentive Plan and the 1997 Director Stock Option
Plan of Best Software, Inc., a Virginia corporation (the "Registrant"), pursuant
to Rule 428(b)(1) under the Securities Act of 1933, as amended (the "Securities
Act").
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The Registrant is subject to the informational and reporting
requirements of Sections 13(a), 14, and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and in accordance therewith files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). The following documents, which are on file with
the Commission, are incorporated in this Registration Statement by reference:
(a) The Registrant's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Exchange Act or the latest prospectus filed
pursuant to Rule 424(b) under the Securities Act that contains audited
financial statements for the Registrant's latest fiscal year for which
such statements have been filed.
(b) All other reports filed pursuant to Section 13(a) or 15(d)
of the Exchange Act since the end of the fiscal year covered by the
document referred to in (a) above.
(c) The description of the Registrant's Common Stock, no par
value per share (the "Common Stock"), contained in a registration
statement filed under the Exchange Act, including any amendment or report
filed for the purpose of updating such description.
All documents subsequently filed by the Registrant 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 shares of Common Stock offered
hereby have been sold or which deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference herein and to be part hereof
from the date of the filing of such documents.
Item 4. Description of Securities
Not applicable.
3
<PAGE> 4
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
Sections 13.1-696 through 13.1-704 (the "Indemnification Statute") of the
Virginia Stock Corporation Act, as amended, provide a detailed statutory
framework covering indemnification of officers and directors against liabilities
and expenses arising out of legal proceedings brought against them by reason of
their being or having been directors or officers. The Indemnification Statute
generally provides that a director or officer of a corporation (i) shall be
indemnified by the corporation for all reasonable expenses of any such legal
proceeding if he entirely prevails in the defense of such proceeding and (ii)
may be indemnified by the corporation for the reasonable expenses, judgments,
fines, penalties and amounts paid in settlement of any such proceeding (other
than a derivative suit), even if he does not entirely prevail in such
proceeding, if (A) he conducted himself in good faith, (B) he believed, in the
case of conduct in his official capacity with the corporation, that his conduct
was in its best interests, (C) he believed, in all other cases, that his conduct
was at least not opposed to the corporation's best interest and (D) in the case
of any criminal proceeding, he had no reasonable cause to believe his conduct
was unlawful. No indemnification, however, may be made under clause (ii) above
if (A) in the case of a derivative suit (a suit brought in the name of the
corporation by a shareholder), the director or officer is adjudged liable in
such suit, unless a court determines that, despite such adjudication but
considering all the relevant circumstances, he is entitled to indemnification,
or (B) in the case of a proceeding charging improper personal benefit to him,
the director or officer is adjudged liable on the basis that personal benefit
was improperly received by him. In any event, in the case of a derivative suit,
indemnification is limited to reasonable expenses incurred by the officer or
director in connection with the proceeding. The indemnification described in
clause (ii) above may be made only upon a determination that indemnification is
permissible because the applicable standard of conduct has been met. Such a
determination may be made by a majority of a quorum of disinterested directors
(or, if such a quorum cannot be obtained, by a committee of two or more
disinterested directors), by independent legal counsel, by the shareholders or
by a court of competent jurisdiction.
The Indemnification Statute also provides that any corporation shall have
the power to make any further indemnity, including indemnity with respect to a
derivative suit, and including the advancement of expenses, to any director,
officer, employee or agent that may be authorized by the articles of
incorporation or by any by-law made by the shareholders before or after the
event, except an indemnity against willful misconduct or a knowing violation of
the criminal law.
4
<PAGE> 5
The indemnification of directors and officers is provided for by Article 5
of the Registrant's Second Amended and Restated Articles of Incorporation, as
amended October 17, 1997 (the "Second Amended and Restated Articles of
Incorporation") which provides in substance that each director and officer shall
be indemnified against reasonable costs and expenses, including attorney's fees,
and any liabilities which he may incur in connection with any action to which he
may be made a party by reason of his being or having been a director or officer
of the Registrant, unless he engaged in willful misconduct or a knowing
violation of the criminal law. The indemnification provided by the Registrant's
Second Amended and Restated Articles of Incorporation is not deemed exclusive of
or intended in any way to limit any other rights to which any person seeking
indemnification may be entitled.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
The Exhibit Index immediately preceding the exhibits and the
exhibits listed thereon are incorporated herein by reference.
Item 9. Undertakings
1. The Registrant hereby undertakes:
(a) 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;
(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;
5
<PAGE> 6
provided, however that paragraphs (i) and (ii) do not apply
if the Registration Statement is on Form S-3 or Form S-8, and 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 Exchange Act that are incorporated by reference in the
Registration Statement.
(b) That, for the purpose of determining any liability
under the Securities Act, 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.
(c) 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.
2. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) 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 in the initial
bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under
the Securities Act may be permitted for 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 Commission such
indemnification is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
6
<PAGE> 7
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 Reston, Commonwealth of Virginia, on the 30th
day of December, 1997.
BEST SOFTWARE, INC.
By:/s/ Timothy A. Davenport
-------------------------------------
Timothy A. Davenport,
President and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of Best Software, Inc.,
hereby constitute David N. Bosserman and Shelley W. Reback, and each of them
singly, our true and lawful attorneys with full power to them, and each of them
singly, to sign for us and in our names in the capacities indicated below, the
Registration Statement on Form S-8 filed herewith and any and all subsequent
amendments to said Registration Statement, and generally to do all such things
in our names and behalf in our capacities as officers and directors to enable
Best Software, Inc. to comply with the provisions of the Securities Act of 1933,
as amended, and the requirements of the Securities and Exchange Commission,
hereby ratifying and confirming our signatures as they may be signed by our said
attorneys, or any of them, to said Registration Statement and any and all
amendments thereto.
7
<PAGE> 8
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S>/s/ James F. Petersen <C> <C>
- ------------------------- Chairman of the Board and December 30, 1997
James F. Petersen Director
/s/ Timothy A. Davenport
- ------------------------- President and Chief Execu- December 30, 1997
Timothy A. Davenport tive Officer and Director
(Principal Executive Officer)
/s/ David N. Bosserman
- -------------------------- Executive Vice President, December 30, 1997
David N. Bosserman Chief Financial Officer and
Treasurer (Principal
Financial and Accounting
Officer)
/s/ Herbert R. Brinberg
- -------------------------- Director December 30, 1997
Herbert R. Brinberg
/s/ John H. Martinson
- -------------------------- Director December 30, 1997
John H. Martinson
/s/ Richard Lefebvre
- -------------------------- Director December 30, 1997
Richard Lefebvre
</TABLE>
8
<PAGE> 9
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
4.1 Second Amended and Restated Articles of
Incorporation, as amended October 17,
1997.
4.2 Amended and Restated By-Laws of the
Registrant (incorporated herein by
reference to Exhibit 3.4 to the Registrant's
Registration Statement on Form S-1, as
amended (File No. 333-33275 (the
"Form S-1")).*
4.3 Specimen Certificate of Common Stock of
the Registrant (incorporated herein by
reference to Exhibit 4.1 to the Form S-1).*
5 Opinion of Hale and Dorr LLP.
23.1 Consent of Hale and Dorr LLP (included
in Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney (included in the signature
pages of this Registration Statement).
</TABLE>
- ----------------------------
* Incorporated herein by reference
<PAGE> 1
Exhibit 4.1
SECOND AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
BEST SOFTWARE, INC.
1. The name of the Corporation is BEST SOFTWARE, INC.
2. The purpose of the Corporation is to create, market, distribute and
otherwise deal in computer software and related products. In
addition, the Corporation shall have the power to carry on business
of any character whatsoever, that is not prohibited by law.
3. The Corporation shall have the power to issue 40,000,000 shares of
Common Stock, having no par value ("Common Stock"), and 1,000,000
shares of Preferred Stock, having a par value of $.01 per share
("Preferred Stock").
A. COMMON STOCK.
(1) General. The voting, dividend and liquidation rights of
the holders of the Common Stock are subject to and qualified by the
rights of the holders of the Preferred Stock of any series as may be
designated by the Board of Directors upon any issuance of the
Preferred Stock of any series.
(2) Voting. The holders of the Common Stock are entitled to
one vote for each share held at all meetings of shareholders (and
written actions in lieu of meetings). There shall be no cumulative
voting.
(3) Dividends. Dividends may be declared and paid on the
Common Stock from funds lawfully available therefor as and when
determined by the Board of Directors and subject to any preferential
dividend rights of any then outstanding Preferred Stock.
(4) Liquidation. Upon the dissolution or liquidation of the
Corporation, whether voluntary or involuntary, holders of Common
Stock will be entitled to receive all assets of the Corporation
available for distribution to its shareholders, subject to any
preferential rights of any then outstanding Preferred Stock.
<PAGE> 2
B. PREFERRED STOCK.
Preferred Stock may be issued from time to time in one or
more series, each of such series to have such terms as stated or
expressed herein and in the resolution or resolutions providing for
the issue of such series adopted by the Board of Directors of the
Corporation as hereinafter provided. Any shares of Preferred Stock
which may be redeemed, purchased or acquired by the Corporation may
be reissued except as otherwise provided by law. Different series of
Preferred Stock shall not be construed to constitute different
classes of shares for the purposes of voting by classes unless
expressly provided.
Authority is hereby expressly granted to the Board of
Directors from time to time to issue the Preferred Stock in one or
more series, and in connection with the creation of any such series,
by resolution or resolutions providing for the issue of the shares
thereof, to determine and fix such voting powers, full or limited, or
no voting powers, and such designations, preferences and relative
participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, including without limitation
thereof, dividend rights, conversion rights, redemption privileges
and liquidation preferences, as shall be stated and expressed in such
resolutions, all to the full extent now or hereafter permitted by the
Virginia Stock Corporation Act. Without limiting the generality of
the foregoing, the resolutions providing for issuance of any series
of Preferred Stock may provide that such series shall be superior or
rank equally or be junior to the Preferred Stock of any other series
to the extent permitted by law. Except as otherwise provided in these
Articles of Incorporation, no vote of the holders of the Preferred
Stock or Common Stock shall be a prerequisite to the designation or
issuance of any shares of any series of the Preferred Stock
authorized by and complying with the conditions of these Articles of
Incorporation, the right to have such vote being expressly waived by
all present and future holders of the capital stock of the
Corporation.
4. The number of directors shall be fixed in accordance with the
provisions of the Corporation's By-laws.
5. Indemnification and Exculpation.
A. In this Article 5:
"applicant" means the person seeking indemnification
pursuant to this Article 5.
"expenses" includes counsel fees.
"liability" means the obligation to pay a judgment,
settlement, penalty, fine, including any excise tax
assessed with respect to an employee
<PAGE> 3
benefit plan, or reasonable expenses incurred with respect to a
proceeding.
"party" includes an individual who was, is, or is threatened to
be made a named defendant or respondent in a proceeding.
"proceeding" means any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal,
administrative or investigative and whether formal or informal.
B. In any proceeding brought by or in the right of the Corporation or
brought by or on behalf of shareholders of the Corporation, no
director or officer of the Corporation shall be liable to the
Corporation or its shareholders for monetary damages with respect to
any transaction, occurrence or course of conduct, except for
liability resulting from such person's having engaged in willful
misconduct or a knowing violation of the criminal law or any federal
or state securities law.
C. The Corporation shall indemnify (1) any person who was or is a
party to any proceeding, including a proceeding brought by a
shareholder in the right of the Corporation or brought by or on
behalf of shareholders of the Corporation, by reason of the fact that
he is or was a director, or officer, employee or agent of the
Corporation, or (2) any director or officer who is or was serving at
the request of the Corporation as a director, trustee, partner,
employee, agent or officer of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against
any liability incurred by him in connection with such proceeding
unless he engaged in willful misconduct or a knowing violation of the
criminal law. A person is considered to be serving an employee
benefit plan at the Corporation's request if his duties to the
Corporation also impose duties on, or otherwise involve services by,
him to the plan or to participants in or beneficiaries of the plan.
The Board of Directors is hereby empowered, by a majority vote of a
quorum of disinterested directors, to enter into a contract to
indemnify any director or officer in respect of any proceedings
arising from any act or omission, whether occurring before or after
the execution of such contract.
D. The provisions of this Article 5 shall be applicable to all
proceedings commenced after the adoption hereof by the shareholders
of the Corporation, arising from any act or omission, whether
occurring before or after such adoption. No amendment or repeal of
this Article 5 shall have any effect on the rights provided under
this Article 5 with respect to any act or omission occurring prior to
such amendment or repeal. The Corporation shall promptly take all
such actions, and make all such determinations, as shall be necessary
or appropriate to comply with its obligation to make any indemnity
under this Article 5 and shall promptly pay or reimburse all
reasonable expenses, including attorneys' fees, incurred by any such
director, officer, employee or
<PAGE> 4
agent in connection with such actions and determinations or
proceedings of any kind arising therefrom.
E. The termination of any proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent,
shall not of itself create a presumption that the applicant did not
meet the standard of conduct described in Section B or C of this
Article 5.
F. Any indemnification under Section C of this Article 5 (unless
ordered by a court) shall be made by the Corporation only as
authorized in the specific case upon a determination that
indemnification of the applicant is permissible in the circumstances
because he has met the applicable standard of conduct set forth in
Section C of this Article 5.
The determination shall be made:
(1) By the Board of Directors by a majority vote of a
quorum consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection
(1) of this Section F, by majority vote of a committee duly
designated by the Board of Directors (in which designation directors
who are parties may participate), consisting solely of two or more
directors not at the time parties to the proceeding;
(3) By special legal counsel:
(a) Selected by the Board of Directors or its
committee in the manner prescribed in subsection (1) or (2) of this
Section F; or
(b) If a quorum of the Board of Directors cannot
be obtained under subsection (1) of this Section F and a committee
cannot be designated under subsection (2) of this Section F, selected
by majority vote of the full Board of Directors, in which selection
directors who are parties may participate; or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time parties to the
proceeding may not be voted on the determination.
Any evaluation as to reasonableness of expenses
shall be made in the same manner as the determination that
indemnification is appropriate, except that if the determination is
made by special legal counsel, such evaluation as to reasonableness
of expenses shall be made by those entitled under subsection (3) of
this Section F of this Article 5 to select counsel.
<PAGE> 5
Notwithstanding the foregoing, in the event there
has been a change in the composition of a majority of the Board of
Directors after the date of the alleged act or omission with respect
to which indemnification is claimed, any determination as to
indemnification and advancement of expenses with respect to any claim
for indemnification made pursuant to this Article 5 shall be made by
special legal counsel agreed upon by the Board of Directors and the
applicant. If the Board of Directors and the applicant are unable to
agree upon such special legal counsel, the Board of Directors and the
applicant each shall select a nominee, and the nominees shall select
such special legal counsel.
G. (1) The Corporation shall pay for or reimburse the
reasonable expenses incurred by any applicant who is a party to
a proceeding in advance of final disposition of the proceeding or the
making of any determination under Section C of this Article 5 if the
applicant furnishes the Corporation:
(a) a written statement of his good faith belief
that he has met the standard of conduct described in Section C of
this Article 5; and
(b) a written undertaking, executed personally or
on his behalf, to repay the advance if it is ultimately determined
that he did not meet such standard of conduct.
(2) The undertaking required by paragraph (b) of subsection
(1) of this Section shall be an unlimited general obligation of the
applicant but need not be secured and may be accepted without
reference to financial ability to make repayment.
(3) Authorizations of payments under this section shall be
made by the persons specified in Section F of this Article 5 upon a
determination that the facts then known to those making the
determination would not preclude indemnification under this Article
5.
H. The Corporation may purchase and maintain insurance to indemnify
it against the whole or any portion of the liability assumed by it in
accordance with this Article 5 and may also procure insurance, in
such amounts as the Board of Directors may determine, on behalf of
any person who is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan
or other enterprise, against any liability asserted against or
incurred by him in any such capacity or arising from his status as
such, whether or not the Corporation would have power to indemnify
him against such liability under the provisions of this Article 5.
I. Every reference herein to directors, officers, employees or
agents shall include former directors, officers, employees and
agents and their respective
<PAGE> 6
heirs, executors and administrators. The indemnification hereby
provided and provided hereafter pursuant to the power hereby
conferred by this Article 5 on the Board of Directors shall not be
exclusive of any other rights to which any person may be entitled,
including any right under policies of insurance that may be purchased
and maintained by the Corporation or others, with respect to claims,
issues or matters in relation to which the Corporation would not have
the power to indemnify such person under the provisions of this
Article 5. Such rights shall not prevent or restrict the power of the
Corporation to make or provide for any further indemnity, or
provisions for determining entitlement to indemnity, pursuant to one
or more indemnification agreements, bylaws, or other arrangements
(including, without limitation, creation of trust funds or security
interests funded by letters of credit or other means) approved by the
Board of Directors (whether or not any of the directors of the
Corporation shall be a party to or beneficiary of any such
agreements, bylaws or arrangements); provided, however, that any
provision of such agreements, bylaws or other arrangements shall not
be effective if and to the extent that it is determined to be
contrary to this Article or applicable laws of the Commonwealth of
Virginia.
J. Each provision of this Article 5 shall be severable, and an
adverse determination as to any such provision shall in no way affect
the validity of any other provision.
6. No holder of (a) stock of any class of the Corporation, whether now
or hereafter authorized, (b) any warrants, rights or options to
purchase such stock, or (c) any securities or obligations
convertible into any such stock or into any warrants, rights or
options to purchase any such stock (the interests referred to in
clauses (a), (b) and (c) being hereinafter referred to as "Equity
Interest") shall have (i) any pre-emptive right to purchase or
subscribe to any Equity Interests that may hereafter be created,
issued or sold or (ii) any right of subscription to any Equity
Interest.
7. This Article 7 is inserted for the management of the business and for
the conduct of the affairs of the Corporation, and it is expressly
provided that it is intended to be in furtherance and not in
limitation or exclusion of the powers conferred by the Virginia Stock
Corporation Act.
A. The number of the directors of the Corporation shall consist of
not less than three nor more than eight. The exact number of
directors within the minimum and maximum limitations specified in the
preceding sentence shall be fixed from time to time by the Board of
Directors pursuant to a resolution adopted by a majority of the
entire Board.
B. The Board of Directors shall be and is divided into three classes:
Class I, Class II and Class III. No one class shall have more than
one director more than any other class. If a fraction is contained in
the quotient arrived at by
<PAGE> 7
dividing the authorized number of directors by three, then, if such
fraction is one-third, the extra director shall be a member of Class
III and, if such fraction is two-thirds, one of the extra directors
shall be a member of Class II and the other extra director shall be a
member of Class III, unless otherwise provided for from time to time
by resolution adopted by a majority of the Board of Directors.
C. Elections of directors need not be by written ballot except as and
to the extent provided in the By-Laws of the Corporation.
D. Each director shall serve for a term ending on the date of the
third annual meeting following the annual meeting at which such
director was elected.
E. In the event of any increase or decrease in the authorized number
of directors, (i) each director then serving as such shall
nevertheless continue as a director of the class of which he is a
member until the expiration of his current term or his prior death,
retirement, or resignation and (ii) the newly created or eliminated
directorships resulting from such increase or decrease shall be
apportioned by the Board of Directors among the three classes of
directors so as to ensure that no one class has more than one
director more than any other class. To the extent possible,
consistent with the foregoing rule, any newly created directorships
shall be added to those classes whose terms of office are to expire
at the latest dates following such allocation, and any newly
eliminated directorships shall be subtracted from those classes whose
terms of office are to expire at the earliest dates following such
allocation, unless otherwise provided for from time to time by
resolution adopted by a majority of the directors then in office,
although less than a quorum.
F. Notwithstanding any provisions to the contrary contained herein,
each director shall hold office until his successor is elected and
qualified, or until his earlier death, resignation or removal.
G. Any vacancy in the Board of Directors, however occurring,
including a vacancy resulting from an enlargement of the Board, may
be filled only by vote of a majority of the directors then in office,
although less than a quorum, or by a sole remaining director. A
director elected to fill a vacancy shall be elected for the unexpired
term of his predecessor in office, if applicable, and a director
chosen to fill a position resulting from an increase in the number of
directors shall hold office until the next election of the class for
which such director shall have been chosen and until this successor
is elected and qualified, or until his earlier death, resignation or
removal.
H. At any meeting of the Board of Directors at which a quorum is
present, the vote of a majority of those present shall be sufficient
to take any action,
<PAGE> 8
unless a different vote is specified by law or the Corporation's
Articles of Incorporation or By-Laws.
I. Any one or more of all of the directors may be removed, with
cause, by the holders of at least sixty-six and two-thirds percent
(66 2/3%) of the shares then entitled to vote at an election of
directors.
J. Advance notice of shareholder nominations for election of
directors and other business to be brought by shareholders before a
meeting of shareholders shall be given in the manner provided in the
By-Laws of the Corporation.
8. A director may be removed from office only for cause, by a vote of
the holders of two-thirds of the shares outstanding and entitled to
vote thereon, at a special meeting of the shareholders called for
that purpose.
9. A. These Articles of Incorporation may be amended in any manner now
or hereafter prescribed by the Virginia Stock Corporation Act, as
amended, provided that, except as set forth below or otherwise
required by law, shareholders may approve any proposed amendment of
these Articles of Incorporation by vote of the holders of a majority
of shares outstanding and entitled to vote thereon. Notwithstanding
the foregoing, Article 4, Article 5, Article 7, Article 8, this
Section A of Article 9, Section B of Article 3 and the provisions of
Article 3 authorizing 1,000,000 shares of undesignated Preferred
Stock, $.01 par value per share, may only be amended by vote of the
holders of at least two-thirds of the shares outstanding and
entitled to vote thereon.
B. The shareholders may approve a merger, share exchange or sale of
all or substantially all of the Corporation's assets not in the
ordinary course of business by vote of the holders of a majority of
the shares outstanding and entitled to vote thereon; provided,
however, that the foregoing shall not be applicable to an "affiliated
transaction" as defined in Section 13.1-725 of the Virginia Stock
Corporation Act, as amended, or any successor provision.
<PAGE> 1
Exhibit 5
December 30, 1997
Best Software, Inc.
11413 Isaac Newton Square
Reston, Virginia 20190
Re: Employee Incentive Stock Option Plan
Amended and Restated 1992 Stock Option Plan
1997 Employee Stock Purchase Plan
1997 Stock Incentive Plan and
1997 Director Stock Option Plan
Ladies and Gentlemen:
We have assisted in the preparation of a Registration Statement on
Form S-8 (the "Registration Statement") to be filed on December 30, 1997 with
the Securities and Exchange Commission relating to an aggregate of 2,904,653
shares of the Common Stock, no par value per share ("Common Stock"), of Best
Software, Inc., a Virginia corporation (the "Company"), issuable under the
Company's Employee Incentive Stock Option Plan, Amended and Restated 1992 Stock
Option Plan, 1997 Employee Stock Purchase Plan, 1997 Stock Incentive Plan, 1997
Director Stock Option Plan (the "Plans").
We have examined the Second Amended and Restated Articles of
Incorporation of the Company and all amendments thereto, and originals, or
copies certified to our satisfaction, of all pertinent records of the meetings
of the directors and stockholders of the Company or written actions in lieu of
such meetings, the aforementioned Registration Statement and such other
documents and instruments to this Company as in our judgment are necessary or
appropriate to enable us to render the opinions expressed below.
In our examination of the foregoing documents, we have assumed the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals, the conformity to original documents of all documents submitted
to us as certified or photostatic copies and the authenticity of the originals
of all such documents.
Based upon and subject to the foregoing, we are of the opinion that
the Company has duly authorized for issuance the shares of its Common Stock
covered by the Registration Statement to be issued under the Plans, as described
in the Registration Statement, and such shares, when issued and paid for in
accordance with
<PAGE> 2
the terms of the Plans and at a price per share in excess of the par value per
share for such shares, will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion with the Securities
and Exchange Commission in connection with the aforementioned Registration
Statement.
Very truly yours,
/s/ Hale and Dorr LLP
HALE AND DORR LLP
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our reports dated
August 6, 1997 (except with respect to the increase in authorized shares
discussed in Note 1, as to which the date is September 11, 1997) included in
Best Software, Inc.'s Form S-1 Registration No. 333-33275 and to all references
to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Washington, D.C.
December 26, 1997
