Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
SOFTWORKS, INC.
(Exact name of registrant as specified in its charter)
Delaware 52-1092916
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5845 Richmond Highway, Suite 400, Alexandria, Virginia 22303
(Address of principal executive offices) (Zip Code)
SOFTWORKS, INC. 1999 STOCK OPTION PLAN, AS AMENDED
(Full Title of the Plan)
Judy G. Carter, President
Softworks, Inc.
5845 Richmond Highway
Alexandria, Virginia 22303
(Name and address of agent for service)
(703) 317-2424
(Telephone number, including area code, of agent for service)
copy to:
Nancy D. Lieberman, Esq.
Blau, Kramer, Wactlar & Lieberman, P.C.
100 Jericho Quadrangle
Jericho, New York 11753
(516) 822-4820
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=========================================================================================================
Title of Each Proposed Minimum Proposed Maximum
Class of Securities Amount to be Offering Price Per Aggregate Offering Amount of
To be Registered Registered Security (1) Price (1) Registration Fee
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $.10 1,500,000 shs.(2) $9.6250 $14,437,500 $3,812
per share
=========================================================================================================
<FN>
(1) Estimated solely for the purpose of calculating the registration fee, based
upon the last reported sales price of the Company's Common Stock on the Nasdaq
Stock Market on December 27, 1999.
(2) The Registration Statement also covers an indeterminate number of additional
shares of Common Stock which may become issuable pursuant to anti-dilution and
adjustment provisions of the Plan.
</FN>
</TABLE>
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
Softworks hereby incorporates by reference into this Registration Statement the
documents listed in (a) and (b) below:
(a) Softworks Annual Report on Form 10-K for the fiscal year ended
December 31, 1998;
(b) Softworks Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 1999, June 30, 1999 and September 30, 1999; and
(c) The description of the class of securities to be offered which is
contained in a registration statement filed under Section 12 of the
Securities Exchange Act of 1934 (File No. 0-24719), including any
amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by Softworks pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which indicates that all securities offered have been sold or which
deregisters all such securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of filing of such documents.
Item 4. Description of Securities.
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Members of the law firm of Blau, Kramer, Wactlar & Lieberman, P.C. own an
aggregate 35,000 shares of Common Stock.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Softworks, a Delaware corporation, is empowered by Section 145 of the Delaware
General Corporation Law (the "Delaware Act"), subject to the procedures and
limitations stated therein, to indemnify certain parties. Section 145 of the
Delaware Act provides in part that a corporation shall have the power to
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding (other than
an action by or in the right of the corporation) by reason of the fact that such
person 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 or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, and with respect
to any criminal action or proceeding had no reasonable cause to believe his
conduct was unlawful. Similar indemnity is authorized for such persons against
expenses (including attorneys' fees) actually and reasonably incurred in defense
or settlement of any threatened, pending or completed action or suit by or in
the right of the corporation, if such person acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and provided further that (unless a court of competent jurisdiction
otherwise provides) such person shall not have been adjudged liable to the
corporation. Any such indemnification may be made only as authorized in each
specific case upon a determination by the stockholders or disinterested
directors that indemnification is proper because the indemnitee has met the
applicable standard of conduct. Where an officer or a director is successful on
the merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses which such officer or
director actually or reasonably incurred. Section 145 provides further that
indemnification pursuant to its provisions is not exclusive of other rights of
indemnification to which a person may be entitled under any law, agreement, vote
of stockholders or disinterested directors or otherwise.
<PAGE>
Softworks' Certificate of Incorporation and By-laws contain provisions that
limit the potential personal liability of directors for certain monetary damages
and provide for indemnity of directors and other persons. Softworks also
maintains officers and directors liability insurance. The policy coverage is $10
million, which includes reimbursement for costs and fees, with a maximum
deductible for officers and directors of $200,000 for each securities-related
claim and $75,000 for each non-securities- related claim. Softworks is unaware
of any pending or threatened litigation against Softworks or its directors that
would result in any liability for which such director would seek indemnification
or similar protection.
The provisions affecting personal liability do not abrogate a director's
fiduciary duty to Softworks and its stockholders, but eliminate personal
liability for monetary damages for breach of that duty. The provisions do not,
however, eliminate or limit the liability of a director for failing to act in
good faith, for engaging in intentional misconduct or knowingly violating a law,
for authorizing the illegal payment of a dividend or repurchase of stock, for
obtaining an improper personal benefit, for breaching a director's duty of
loyalty (which is generally described as the duty not to engage in any
transaction that involves a conflict between the interests of Softworks and
those of the director) or for violations of the federal securities laws. The
provisions also limit or indemnify against liability resulting from grossly
negligent decisions, including grossly negligent business decisions relating to
attempts to change control of Softworks.
The provisions regarding indemnification provide, in essence, that Softworks
will indemnify its directors against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with any action, suit or proceeding arising out of the director's
status as a director of Softworks, including actions brought by or on behalf of
Softworks (shareholder derivative actions). The provisions do not require a
showing of good faith. Moreover, they do not provide indemnification for
liability arising out of willful misconduct, fraud, or dishonesty, for
"short-swing" profits violations under the federal securities laws, or for the
receipt of illegal remuneration. The provisions also do not provide
indemnification for any liability to the extent such liability is covered by
insurance. One purpose of the provisions is to supplement the coverage provided
by such insurance.
These provisions diminish the potential rights of action that might otherwise be
available to stockholders by limiting the liability of officers and directors to
the maximum extent allowable under Delaware law and by affording indemnification
against most damages and settlement amounts paid by a director of Softworks in
connection with any stockholders derivative action. However, the provisions do
not have the effect of limiting the right of a stockholder to enjoin a director
from taking actions in breach of the director's fiduciary duty, or to cause
Softworks to rescind actions already taken, although as a practical matter
courts may be unwilling to grant such equitable remedies in circumstances in
which such actions have already been taken.
Softworks has entered into indemnification agreements with certain of its
officers. The indemnification agreements provide for reimbursement for all
direct and indirect costs of any type or nature whatsoever (including attorneys'
fees and related disbursements) actually and reasonably incurred in connection
with either the investigation, defense or appeal of a legal proceeding,
including amounts paid in settlement by or on behalf of an indemnitee
thereunder.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not applicable.
Item 8. Exhibits.
--------
4.1 1999 Stock Option Plan, as amended
5 Opinion and consent of Blau, Kramer, Wactlar & Lieberman, P.C.
23.1 Consent of Blau, Kramer, Wactlar & Lieberman, P.C. - included in their
opinion filed as Exhibit 5.
23.2 Consent of Arthur Andersen LLP
24 Powers of Attorney.
<PAGE>
Item 9. Undertakings.
------------
(a) The undersigned hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the Registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
the Registration Statement.
(2) That, for the purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against policy
as expressed in the Act and will be governed by final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all
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 Alexandria, Virginia on the 27th day of December, 1999.
SOFTWORKS, INC.
By: /s/ J. G. Carter
----------------------------------
Judy G. Carter,
President and Director (Chief Executive Officer)
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on December 27, 1999 by the
following persons in the capacities indicated. Each person whose signature
appears below constitutes and appoints Judy G. Carter and Robert McLaughlin, and
each of them acting individually, with full power of substitution, our true and
lawful attorneys-in-fact and agents to do any and all acts and things in our
name and on our behalf in our capacities indicated below which they or either of
them may deem necessary or advisable to enable Softworks, Inc. to comply with
the Securities Act of 1933, as amended, and any rules, regulations and
requirements of the Securities and Exchange Commission, in connection with this
Registration Statement including specifically, but not limited to, power and
authority to sign for us or any of us in our names in the capacities stated
below, any and all amendments (including post-effective amendments) thereto,
granting unto said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
such connection, as fully to all intents and purposes as we might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or his substitute or substitutes, may lawfully do or cause to be done by
virtue thereof.
Signature Title
--------- -----
- ------------------- Chairman of the Board and Director
James A. Cannavino
/s/ J.G. Carter President, Chief Executive Officer and a Director
Judy G. Carter
/s/ C.R. Kinsey Vice President and Secretary
C. R. Kinsey, III
/s/ R.C. McLaughlin Treasurer and Chief Financial Officer
Robert C. McLaughlin
/s/ Charles Feld Director
Charles Feld
/s/ Dennis Murray Director
Dennis Murray
- ------------------- Director
Bernard Puckett
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SOFTWORKS, INC.
Form S-8 Registration Statement
E X H I B I T I N D E X
Page No. in Sequential
Exhibit Numbering of all Pages,
Number Exhibit Description including Exhibit Pages
- ------- ------------------- -----------------------
4.1 1999 Stock Option Plan, as amended. . . . . . .
5 Opinion and Consent of Counsel. . . . . . . . .
23.1 Consent of Counsel. . . . . . . . . . . . . . . See Exhibit 5
23.2 Consent of Arthur Andersen LLP. . . . . . . . .
24 Powers of Attorney. . . . . . . . . . . . . . . See signature page
Exhibit 4.1
SOFTWORKS, Inc.
1999 Stock Option Plan, As Amended
----------------------------------
SECTION 1. GENERAL PROVISIONS
1.1. Name and General Purpose
------------------------
The name of this plan is the SOFTWORKS, Inc. 1999 Stock Option Plan
(hereinafter called the "1999 Plan"). The 1999 Plan is intended to be a
broadly-based incentive plan which enables SOFTWORKS Inc. (the "Company") and
its subsidiaries and affiliates to foster and promote the interests of the
Company by attracting and retaining directors, officers and employees of, and
consultants to, the Company who contribute to the Company's success by their
ability, ingenuity and industry, to enable such directors, officers, employees
and consultants to participate in the long-term success and growth of the
Company by giving them a proprietary interest in the Company and to provide
incentive compensation opportunities competitive with those of competing
corporations.
1.2. Definitions
-----------
a. "Affiliate" means any person or entity controlled by or under common
control with the Company, by virtue of the ownership of voting securities, by
contract or otherwise.
b. "Board" means the Board of Directors of the Company.
c. "Change in Control" means a change of control of the Company, or in any
person directly or indirectly controlling the Company, which shall mean:
(i) any person who is not currently such becomes the beneficial owner,
directly or indirectly, of securities of the Company representing 25% or more of
the combined voting power of the Company's then outstanding voting securities;
or
(ii) three or more directors, whose election or nomination for election is
not approved by a majority of the Incumbent Board (as hereinafter defined), are
elected within any single 24-month period to serve on the Board of Directors; or
(iii) members of the Incumbent Board cease to constitute a majority of the
Board of Directors without the approval of the remaining members of the
Incumbent Board; or
(iv) any merger (other than a merger where the Company is the survivor and
there is no accompanying Change in Control under subparagraphs (i), (ii) or
(iii) of this paragraph (b)), consolidation, liquidation or dissolution of the
Company, or the sale of all or substantially all of the assets of the Company.
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur pursuant to subparagraph (i) of this definition solely because 25% or more
of the combined voting power of the Company's outstanding securities is acquired
by one or more employee benefit plans maintained by the Company or by any other
employer, the majority interest in which is held, directly or indirectly, by the
Company. For purposes of this definition, the terms "person" and "beneficial
owner" shall have the meaning set forth in Sections 3(a) and 13(d) of the
Exchange Act, and in the regulations promulgated thereunder, as in effect on
February 7, 1999; and the term "Incumbent Board" shall mean (A) the members of
the Board of Directors of the Company on February 7, 1999, to the extent that
they continue to serve as members of the Board of Directors, and (B) any
individual who becomes a member of the Board of Directors after February 7,
1999, if his election or nomination for election as a director was approved by a
vote of at least three-quarters of the then Incumbent Board.
d. "Committee" means the Committee referred to in Section 1.3 of the 1999
Plan.
e. "Common Stock" means shares of the Common Stock, par value $.10 per
share, of the Company.
f. "Company" means SOFTWORKS Inc., a corporation organized under the laws
of the State of Delaware (or any successor corporation).
g. "Fair Market Value" means the market price of the Common Stock on The
Nasdaq Stock Market on the date of the grant or as reported on any other
exchange on which the Common Stock is then traded on such date or on any other
date on which the Common Stock is to be valued hereunder. If no sale shall have
been reported on any such exchange, Fair Market Value shall be determined by the
Committee.
<PAGE>
h. "Non-Employee Director" shall have the meaning set forth in Rule 16(b)
promulgated by the Securities and Exchange Commission ("Commission").
i. "Option" means any option to purchase Common Stock under Section 2 of
the 1999 Plan.
j. "Option Agreement" means the option agreement described in Section 2.4
of the 1999 Plan.
k. "Participant" means any director, officer, employee or consultant of the
Company, a Subsidiary or an Affiliate who is selected by the Committee to
participate in the 1999 Plan.
l. "Subsidiary" means any corporation in which the Company possesses
directly or indirectly 50% or more of the combined voting power of all classes
of stock of such corporation.
m. "Total Disability" means accidental bodily injury or sickness which
wholly and continuously disabled an optionee. The Committee, whose decisions
shall be final, shall make a determination of Total Disability.
1.3. Administration of the Plan
--------------------------
The 1999 Plan shall be administered by the Board or by the Committee
appointed by the Board consisting of two or more members of the Board all of
whom shall be Non-Employee Directors. The Committee shall serve at the pleasure
of the Board and shall have such powers as the Board may, from time to time,
confer upon it.
Subject to this Section 1.3, the Committee shall have sole and complete
authority to adopt, alter, amend or revoke such administrative rules, guidelines
and practices governing the operation of the 1999 Plan as it shall, from time to
time, deem advisable, and to interpret the terms and provisions of the 1999
Plan.
The Committee shall keep minutes of its meetings and of action taken by it
without a meeting. A majority of the Committee shall constitute a quorum, and
the acts of a majority of the members present at any meeting at which a quorum
is present, or acts approved in writing by all of the members of the Committee
without a meeting, shall constitute the acts of the Committee.
1.4. Eligibility
-----------
Stock Options may be granted only to directors, officers, employees or
consultants of the Company or a Subsidiary or Affiliate. Any person who has been
granted any Option may, if he is otherwise eligible, be granted an additional
Option or Options.
1.5. Shares
------
The aggregate number of shares reserved for issuance pursuant to the 1999
Plan shall be 2,750,000 shares of Common Stock, or the number and kind of shares
of stock or other securities which shall be substituted for such shares or to
which such shares shall be adjusted as provided in Section 1.6.
Such number of shares may be set aside out of the authorized but unissued
shares of Common Stock or out of issued shares of Common Stock acquired for and
held in the Treasury of the Company, not reserved for any other purpose. Shares
subject to, but not sold or issued under, any Option terminating or expiring for
any reason prior to its exercise in full will again be available for Options
thereafter granted during the balance of the term of the 1999 Plan.
1.6. Adjustments Due to Stock Splits,
Mergers, Consolidation, Etc.
-------------------------------
If, at any time, the Company shall take any action, whether by stock
dividend, stock split, combination of shares or otherwise, which results in a
proportionate increase or decrease in the number of shares of Common Stock
theretofore issued and outstanding, the number of shares which are reserved for
issuance under the 1999 Plan and the number of shares which, at such time, are
subject to Options shall, to the extent deemed appropriate by the Committee, be
increased or decreased in the same proportion, provided, however, that the
Company shall not be obligated to issue fractional shares.
Likewise, in the event of any change in the outstanding shares of Common
Stock by reason of any recapitalization, merger, consolidation, reorganization,
combination or exchange of shares or other corporate change, the Committee shall
make such substitution or adjustments, if any, as it deems to be appropriate, as
to the number or kind of shares of Common Stock or other securities which are
reserved for issuance under the 1999 Plan and the number of shares or other
securities which, at such time are subject to Options.
<PAGE>
In the event of a Change in Control, at the option of the Board or
Committee, (a) all Options outstanding on the date of such Change in Control
shall, for a period of sixty (60) days following such Change in Control, become
immediately and fully exercisable, and (b) an optionee will be permitted to
surrender for cancellation within sixty (60) days after such Change in Control
any Option or portion of an Option which was granted more than six (6) months
prior to the date of such surrender, to the extent not yet exercised, and to
receive a cash payment in an amount equal to the excess, if any, of the Fair
Market Value (on the date of surrender) of the shares of Common Stock subject to
the Option or portion thereof surrendered, over the aggregate purchase price for
such Shares under the Option.
1.7. Non-Alienation of Benefits
--------------------------
Except as herein specifically provided, no right or unpaid benefit under
the 1999 Plan shall be subject to alienation, assignment, pledge or charge and
any attempt to alienate, assign, pledge or charge the same shall be void. If any
Participant or other person entitled to benefits hereunder should attempt to
alienate, assign, pledge or charge any benefit hereunder, then such benefit
shall, in the discretion of the Committee, cease.
1.8. Withholding or Deduction for Taxes
----------------------------------
If, at any time, the Company or any Subsidiary or Affiliate is required,
under applicable laws and regulations, to withhold, or to make any deduction for
any taxes, or take any other action in connection with any Option exercise, the
Participant shall be required to pay to the Company or such Subsidiary or
Affiliate, the amount of any taxes required to be withheld, or, in lieu thereof,
at the option of the Company, the Company or such Subsidiary or Affiliate may
accept a sufficient number of shares of Common Stock to cover the amount
required to be withheld.
1.9 Administrative Expenses
-----------------------
The entire expense of administering the 1999 Plan shall be borne by the
Company.
1.10. General Conditions
------------------
a. The Board or the Committee may, from time to time, amend, suspend or
terminate any or all of the provisions of the 1999 Plan, provided that, without
the Participant's approval, no change may be made which would alter or impair
any right theretofore granted to any Participant.
b. With the consent of the Participant affected thereby, the Committee may
amend or modify any outstanding Option in any manner not inconsistent with the
terms of the 1999 Plan, including, without limitation, and irrespective of the
provisions of Section 2.3(c) below, to accelerate the date or dates as of which
an installment of an Option becomes exercisable.
c. Nothing contained in the 1999 Plan shall prohibit the Company or any
Subsidiary or Affiliate from establishing other additional incentive
compensation arrangements for employees of the Company or such Subsidiary or
Affiliate.
d. Nothing in the 1999 Plan shall be deemed to limit, in any way, the right
of the Company or any Subsidiary or Affiliate to terminate a Participant's
employment with the Company (or such Subsidiary or Affiliate) at any time.
e. Any decision or action taken by the Board or the Committee arising out
of or in connection with the construction, administration, interpretation and
effect of the 1999 Plan shall be conclusive and binding upon all Participants
and any person claiming under or through any Participant.
f. No member of the Board or of the Committee shall be liable for any act
or action, whether of commission or omission, (i) by such member except in
circumstances involving actual bad faith, nor (ii) by any other member or by any
officer, agent or employee.
1.11. Compliance with Applicable Law
------------------------------
Notwithstanding any other provision of the 1999 Plan, the Company shall not
be obligated to issue any shares of Common Stock, or grant any Option with
respect thereto, unless it is advised by counsel of its selection that it may do
so without violation of the applicable Federal and State laws pertaining to the
issuance of securities and the Company may require any stock certificate so
issued to bear a legend, may give its transfer agent instructions limiting the
transfer thereof, and may take such other steps, as in its judgment are
reasonably required to prevent any such violation.
1.12. Effective Dates
---------------
The 1999 Plan was adopted by the Board on February 7, 1999 and amended by
the Board on June 21, 1999, August 9, 1999 and December 6, 1999. The 1999 Plan
shall terminate on February 6, 2009.
<PAGE>
Section 2. OPTION GRANTS
-------------
2.1. Authority of Committee
----------------------
Subject to the provisions of the 1999 Plan, the Committee shall have the
sole and complete authority to determine (i) the Participants to whom Options
shall be granted; (ii) the number of shares to be covered by each Option; and
(iii) the conditions and limitations, if any, in addition to those set forth in
Sections 2 and 3 hereof, applicable to the exercise of an Option, including
without limitation, the nature and duration of the restrictions, if any, to be
imposed upon the sale or other disposition of shares acquired upon exercise of
an Option.
Stock Options granted under the 1999 Plan shall be non-qualified stock
options.
The Committee shall have the authority to grant Options.
2.2. Option Exercise Price
---------------------
The price of stock purchased upon the exercise of Options granted pursuant
to the 1999 Plan shall be the Fair Market Value thereof at the time that the
Option is granted.
The purchase price is to be paid in full in cash, certified or bank
cashier's check or, at the option of the Company, Common Stock valued at its
Fair Market Value on the date of exercise, or a combination thereof, when the
Option is exercised and stock certificates will be delivered only against such
payment.
2.3. Option Grants
-------------
Each Option will be subject to the following provisions:
a. Term of Option
--------------
An Option will be for a term of not more than ten years from the date of
grant.
b. Exercise
--------
(i) By an Employee:
--------------
Subject to the power of the Committee under Section 1.10(b) above and
except in the manner described below upon the death of the optionee, an Option
may be exercised only in installments as follows: up to one-half of the subject
shares on and after the first anniversary of the date of grant, up to all of the
subject shares on and after the second such anniversary of the date of the grant
of such Option but in no event later than the expiration of the term of the
Option.
An Option shall be exercisable during the optionee's lifetime only by the
optionee and shall not be exercisable by the optionee unless, at all times since
the date of grant and at the time of exercise, such optionee is an employee of
or providing services to the Company, any parent corporation of the Company or
any Subsidiary or Affiliate, except that, upon termination of all such
employment or provision of services (other than by death, Total Disability, or
by Total Disability followed by death in the circumstances provided below), the
optionee may exercise an Option at any time within three months thereafter but
only to the extent such Option is exercisable on the date of such termination.
Upon termination of all such employment by Total Disability, the optionee
may exercise such Options at any time within three years thereafter, but only to
the extent such Option is exercisable on the date of such termination.
In the event of the death of an optionee (i) while an employee of or
providing services to the Company, any parent corporation of the Company or any
Subsidiary or Affiliate, or (ii) within three months after termination of all
such employment or provision of services (other than for Total Disability) or
(iii) within three years after termination on account of Total Disability of all
such employment or provision of services, such optionee's estate or any person
who acquires the right to exercise such option by bequest or inheritance or by
reason of the death of the optionee may exercise such optionee's Option at any
time within the period of three years from the date of death. In the case of
clauses (i) and (iii) above, such Option shall be exercisable in full for all
the remaining shares covered thereby, but in the case of clause (ii) such Option
shall be exercisable only to the extent it was exercisable on the date of such
termination.
<PAGE>
(ii) By Persons other than Employees:
-------------------------------
If the optionee is not an employee of the Company or the parent corporation
of the Company or any Subsidiary or Affiliate, the vesting of such optionee's
right to exercise his Options shall be established and determined by the
Committee in the Option Agreement covering the Options granted to such optionee.
Notwithstanding the foregoing provisions regarding the exercise of an
Option in the event of death, Total Disability, other termination of employment
or provision of services or otherwise, in no event shall an Option be
exercisable in whole or in part after the termination date provided in the
Option Agreement.
c. Transferability
---------------
An Option granted under the 1999 Plan shall not be transferable otherwise
than by will or by the laws of descent and distribution, or, as determined by
the Board or the Committee, to (i) a member or members of the optionee's family,
(ii) a trust, (iii) a family limited partnership or (iv) a similar estate
planning vehicle primarily for members of the optionee's family.
2.4. Agreements
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In consideration of any Options granted to a Participant under the 1999
Plan, each such Participant shall enter into an Option Agreement with the
Company providing, consistent with the 1999 Plan, such terms as the Committee
may deem advisable.
December 27, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: SOFTWORKS, Inc.
Registration Statement on Form S-8
----------------------------------
Gentlemen:
Reference is made to the filing by SOFTWORKS, Inc. (the "Corporation") of a
Registration Statement on Form S-8 with the Securities and Exchange Commission
pursuant to the provisions of the Securities Act of 1933, as amended, covering
the registration of 1,500,000 shares of the Corporation's Common Stock, $.001
par value per share, in connection with increases in the number of shares under
the Corporation's 1999 Stock Option Plan (as amended, the "Plan").
As counsel for the Corporation, we have examined its corporate records,
including its Certificate of Incorporation, as amended, By-Laws, its corporate
minutes, the form of its Common Stock certificate, the Plan, related documents
under the Plan and such other documents as we have deemed necessary or relevant
under the circumstances.
Based upon our examination, we are of the opinion that:
1. The Corporation is duly organized and validly existing under the laws
of the State of Delaware.
2. There have been reserved for issuance by the Board of Directors of the
Corporation under the 1999 Plan an additional 1,500,000 shares, for an
aggregate 2,750,000 shares of its Common Stock, $.001 par value per
share. The shares of the Corporation's Common Stock, when issued
pursuant to the 1999 Plan, will be validly authorized, legally issued,
fully paid and non-assessable.
We hereby consent to be named in the Registration Statement and in the
Prospectus which constitutes a part thereof as counsel of the Corporation, and
we hereby consent to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
/s/ Blau, Kramer, Wactlar & Lieberman, P.C.
BLAU, KRAMER, WACTLAR &
LIEBERMAN, P.C.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 9, 1999
included in Softworks Inc's Form 10-K filing for the year ended December 31,
1998 and to all references to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
Vienna, VA
December 27, 1999
