SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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TOWNE SERVICES, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Georgia 62-1618121
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
3950 Johns Creek Court, Suite 100
Suwanee, Georgia 30024
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(Address of Principal Executive Offices)
Amended and Restated Director Stock Option Plan
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(Full Title of the Plan)
G. Lynn Boggs
Chief Executive Officer
Towne Services, Inc.
3950 Johns Creek Court, Suite 100
Suwanee, Georgia 30024
(678) 475-5200
(Name, address, and telephone number of agent for service)
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Copies Requested to:
Charles D. Vaughn, Esq.
Nelson Mullins Riley & Scarborough, L.L.P.
999 Peachtree Street, N.E., Suite 1400
Atlanta, Georgia 30309
(404) 817-6000
(404) 817-6050 (Fax)
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<TABLE>
<CAPTION>
================================================================================================
Title of Securities Amount to be Proposed Maximum Proposed Maximum Amount of
to be Registered Registered Offering Price Aggregate Offering Registration Fee
per Share Price
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<S> <C> <C> <C> <C>
Common Stock, no par value 293,160 $0.72 (1) $211,075 (1) $56
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Common Stock, no par value 6,270 $3.38 (2) $21,193 (2) $5
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</TABLE>
(1) This estimation is solely for the purpose of calculating the registration
fee pursuant to Rules 457 (c) and (h) and is based on 294,400 shares of
common stock being offered at an exercise price of $0.72 based upon the
average of the high and low prices of the common stock on June 16, 2000, as
reported by the National Association of Securities Dealer's automated
quotation system.
(2) In accordance with Rule 457 (h), the registration fee is based upon the
price at which the option may be exercised.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by us with the SEC are incorporated by
reference into this registration statement, and all documents subsequently filed
by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange
Act of 1934 shall be incorporated by reference in this registration statement
and shall be a part of this registration statement from the date of filing of
the documents:
(a) our Annual Report on Form 10-K for the fiscal year ended
December 31, 1999;
(b) our Quarterly Report on Form 10-Q for the fiscal quarter ended
March 31, 2000 filed with Commission pursuant to Section 13(a)
of the Securities Exchange Act; and
(c) the description of our common stock contained in the section
titled "Description of Capital Stock" on pages 49-53 of our
prospectus included in the registration statement on Form
S-1 filed on July 30, 1998 (File No. 333-53341).
Item 4. Description of Securities.
No response is required to this item.
Item 5. Interests of Named Experts and Counsel.
As of June 19, 2000, Glenn W. Sturm, one of our directors and a partner
of Nelson Mullins Riley & Scarborough, L.L.P., owned 354,904 shares of common
stock. In addition, as of June 19, 2000, other members of Nelson Mullins owned
an aggregate of 82,253 shares of common stock.
Item 6. Indemnification of Directors and Officers.
The Georgia Business Corporation Code permits a corporation to
eliminate or limit the personal liability of a director to the corporation or
its shareholders for monetary damages for any breach of duty of care or other
duty as a director, except that a corporation cannot eliminate or limit the
liability of a director for:
o an appropriation, in violation of his duties, of any business
opportunity of the corporation,
o acts or omissions which involve intentional misconduct or a knowing
violation of law,
o unlawful corporate distributions, or
o any transaction from which the director received an improper personal
benefit.
The Georgia Code permits a corporation to indemnify officers to the
same extent as directors. Our amended and restated articles of incorporation
exonerate our directors from monetary liability to the extent described above,
and our amended and restated bylaws provide the same limitation of liability to
our officers.
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<PAGE>
In addition to the rights provided by law, our amended and restated
articles of incorporation and our amended and restated bylaws provide broad
indemnification rights to our directors and the officers, employees and agents
designated by our directors, with respect to various civil and criminal
liabilities and losses which may be incurred by the director, officer, agent or
employee under any pending or threatened litigation or other proceedings. This
indemnification does not apply in the same situations described above with
respect to the exculpation from liability of our directors. We are also
obligated to reimburse directors and other parties for expenses, including legal
fees, court costs and expert witness fees, incurred by those persons in
defending against any of these liabilities and losses, as long as the person in
good faith believes that he or she acted in accordance with the applicable
standard of conduct with respect to the underlying accusations giving rise to
the liabilities or losses and agrees to repay to us any advances made if it is
ultimately determined that the person is not entitled to indemnification by us.
Any amendment or other modification to the applicable law, our amended and
restated articles of incorporation, or our amended and restated bylaws which
limits or otherwise adversely affects the rights to indemnification currently
provided in the articles of incorporation and bylaws shall apply only to
proceedings based upon actions and events occurring after the amendment and
delivery of notice of it to the indemnified parties.
We have entered into separate indemnification agreements with each of
our directors and certain of our officers, whereby we agreed, among other
things, to provide for indemnification and advancement of expenses in a manner
and subject to terms and conditions similar to those set forth in the amended
and restated articles of incorporation and bylaws. Shareholders cannot
invalidate these agreements. In addition, we hold an insurance policy covering
directors and officers under which the insurer agrees to pay, subject to certain
exclusions, for any claim made against our directors and officers for a wrongful
act that they may become legally obligated to pay or for which we are required
to indemnify the directors or officers.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors, officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the SEC this indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against these liabilities (other than our
payment of expenses incurred or paid by one of our directors, officers or
controlling persons in the successful defense of any action, suit or proceeding)
is asserted by the director, officer or controlling person in connection with
the securities being registered, we will, unless in the opinion of our counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether the indemnification by us is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of the issue.
Item 7. Exemption from Registration Claimed.
No response is required to this item.
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<PAGE>
Item 8. Exhibits.
The following exhibits are filed with this Registration Statement:
Exhibit
Number Description of Exhibit
5.1 - Legal opinion of Nelson Mullins Riley & Scarborough, L.L.P.
23.1 - Consent of Arthur Andersen LLP
23.2 - Consent of Nelson Mullins Riley & Scarborough, L.L.P. (contained
in their opinion filed as Exhibit 5.1)
24.1 - Power of Attorney (contained on the signature pages of this
Registration Statement)
Item 9. Undertakings.
The Company 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 aggregate, represent a fundamental change in the
information set forth in this registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
provided, however, that the undertakings set forth in paragraph (i)
and (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 with or furnished to the
Commission pursuant to Section 13 or 15(d) of the Exchange Act of
1934 that are incorporated by reference in this registration
statement;
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<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
Towne Services hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of its annual report
pursuant to Section 13(a) or 15(d) of the Exchange Act of 1934 that is
incorporated by reference in this registration statement shall be deemed to be a
new registration statement relating to the securities offered by this
registration statement, and the offering of the securities at that time shall be
deemed to be the initial bona fide offering of the securities.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
Towne Services pursuant to the foregoing provisions, or otherwise, Towne
Services has been advised that in the opinion of the 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 Towne Services of expenses incurred
or paid by a director, officer or controlling person of Towne Services 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, Towne Services 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 the indemnification by Towne Services is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of that issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Towne Services
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 Atlanta, State of Georgia, on this 19th day of June,
2000.
TOWNE SERVICES, INC.
By: /s/ G. Lynn Boggs
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G. Lynn Boggs
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each of the undersigned officers
and directors of Towne Services, Inc. (the "Company"), a Georgia corporation,
for himself and not for one another, does hereby constitute and appoint G. Lynn
Boggs a true and lawful attorney in his name, place and stead, in any and all
capacities, to sign his name to any and all amendments, including post-effective
amendments, to this Registration Statement, and to cause the same (together with
all Exhibits thereto) to be filed with the Securities and Exchange Commission,
granting unto said attorneys and each of them full power and authority to do and
perform any act and thing necessary and proper to be done in the premises, as
fully to all intents and purposes as the undersigned could do if personally
present, and each of the undersigned for himself hereby ratifies and confirms
all that said attorneys or any one of them shall lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
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<S> <C> <C>
/s/ G. Lynn Boggs Chief Executive Officer and Director June 19, 2000
----------------- (principal executive officer)
G. Lynn Boggs
/s/ Randall S. Vosler Chief Financial Officer June 19, 2000
--------------------- (principal financial and accounting officer)
Randall S. Vosler
/s/ Henry M. Baroco President, Chief Operating Officer and June 19, 2000
------------------- Director
Henry M. Baroco
/s/ Frank W. Brown Director June 19, 2000
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Frank W. Brown
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<PAGE>
/s/ John W. Collins Director June 19, 2000
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John W. Collins
/s/ J. Stanley Mackin Director June 19, 2000
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J. Stanley Mackin
/s/ Richardson M. Roberts Director June 19, 2000
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Richardson M. Roberts
/s/ Joe M. Rogers Director June 19, 2000
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Joe M. Rogers
/s/ John D. Schneider, Jr. Director June 19, 2000
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John D. Schneider, Jr.
/s/ J. Daniel Speight, Jr. Director June 19, 2000
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J. Daniel Speight, Jr.
/s/ Glenn W. Sturm Director June 19, 2000
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Glenn W. Sturm
/s/ J. Stephen Turner Director June 19, 2000
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J. Stephen Turner
/s/ Bahram Yusefzadeh Director June 19, 2000
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Bahram Yusefzadeh
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Exhibit
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5.1 - Legal opinion of Nelson Mullins Riley & Scarborough, L.L.P.
23.1 - Consent of Arthur Andersen LLP
23.2 - Consent of Nelson Mullins Riley & Scarborough, L.L.P.
(contained in their opinion filed as Exhibit 5.1)
24.1 - Power of Attorney (contained on the signature pages of
this Registration Statement)
