Filing under Rule 425 under
the Securities Act of 1933
and deemed filed under Rule 14a-12
of the Securities Exchange Act of 1934
Filing by: BROKAT Infosystems AG
Subject Company: Blaze Software, Inc.
SEC File No. of Blaze: 000-29817
BROKAT AG - SIX MONTHS REPORT 2000
Ladies and Gentleman,
the motto for the second quarter of Fiscal Year 2000 was "Building the
International e-powerhouse." With the acquisition of two US software companies,
Blaze Software and GemStone, Brokat has taken another decisive step on the road
to becoming a global player. The products of both Blaze and GemStone are
excellently positioned and complement our core product TwisterTM with additional
future-oriented technologies for innovative e-business solutions. The
acquisitions have expanded our staff by an additional 400 highly qualified
employees, especially in the US. In the second quarter, we also gained new US
customers in the financial applications sector, and further increased US
revenues to 14.8% of total revenue.
The Managing Board
Brokat at a Glance
<TABLE>
<CAPTION>
Key Figures Six month Six month
ended June, 30 ended June, 30 Change
2000 1999 YOY
---- ---- ---
<S> <C> <C> <C> <C>
Sales DM '000 81.729 42.816 91%
Gross Margin 60% 51%
EBITDASO DM '000 -19.980 -9.334 114%
Net Loss DM '000 -76.686 -25.394 202%
International Sales DM '000 48.254 7.707 526%
Licenses Sales DM '000 38.499 15.598 147%
Partner Sales DM '000 21.127 16.787 26%
Shareholders Equity DM '000 194.091 217.939 -11%
Balance Sheet Total DM '000 496.167 275.070 80%
Equity Ratio 39% 79%
Net Cash Flow
</TABLE>
<PAGE>
2
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
from Investing DM '000 11.956 36.577 -67%
Cash DM '000 163.856 7.141 2.195%
Total Number of Employees,
Brokat Group 814 512 59%
</TABLE>
<PAGE>
3
Acquisitions strengthen products and US presence
The market for e-business solutions is international, and the US is one of most
important markets strategically. In addition to expanding our market presence,
our objective is to expand and strengthen our product portfolio by means of a
very focused acquisition strategy. We have taken another decisive step in this
direction with the planned acquisitions of two US software companies, Blaze
Software in San Jose, California and GemStone in Beaverton, Oregon. Both
companies are an excellent fit in terms of technology and structure. With these
acquisitions we add important functionality in terms of Customer Relationship
Management (CRM) and Java components which complement our Twister(TM) platform.
We also gain access to innovative functionality at a lower cost than if we had
developed them internally and get the opportunity to expand our market presence
quickly.
Furthermore, both companies provide us with technology that makes it possible to
implement solutions for our customers even more rapidly. We are financing the
acquisitions in an all share deal by issuing Brokat shares. The number of Brokat
shares thereby increases by approximately 25 percent. At the same time our
revenues increase by more than 50 percent, on the basis of 1999 figures. Our
shareholders will benefit from this increase in value. In addition 190 Blaze
employees, 143 GemStone employees and 141 Brokat employees in the US, will give
us a strong presence in North America, the most important market for e-business.
With that, of the 1.200 employees worldwide about 500 employees will work in the
US. Because of our strong mobile business components, we think that Brokat is
very well-positioned in North America. In recent months, the topic of mobile
business has gained new momentum in the US, which positions Brokat and our
experience in the European mobile sector in the right place at the right time.
The acquisitions will also produce significant synergy on the costs and earnings
side, which will be reflected in a shorter time to profitability. The
complementary products create significant cross-selling potential in all three
sales organizations, especially in the US. Blaze's core product, Blaze Advisor,
is a software infrastructure for CRM. With the acquisition of Blaze, therefore,
Brokat's e-Services Platform Twister is being expanded to include new functions
in the CRM area. Software for CRM allows companies to optimize their customer
relationships. For example, specific offers can be sent to targeted groups of
customers. Companies can also intensify contact with their customers via
different channels such as the Internet and mobile communications.
GemStone, with its core product GemStone/J, offers a leading Enterprise Java
Beans (EJB) Application Server for critical e-business processes. EJB is a
standard developed by Sun Microsystems for the architecture of server components
that are written in the Java programming language. E-business solutions can
thereby be implemented on the basis of J2EE (Java2 Platform Enterprise Edition).
In the future, Twister will also support this widely accepted industry standard.
New Customers in North America
Brokat also did win new North American customers in the second quarter. Charter
One Financial, one of the 30 largest US banks, selected Twister and the
financial applications,
<PAGE>
which are based on the Twister platform. Charter One will offer online banking
to its retail and corporate customers, and will give them the possibility to
conduct banking transactions from a mobile phone. With the addition of Brokat's
products, customers will be able to access the bank's services at their branch
office or by telephone, via the Internet and their mobile phones. Toronto
Dominion Bank, Canada's largest bank with 2.2 million online accounts, and the
third-largest online bank in the world, also offers its corporate customers
comprehensive Twister-based cash management services. Another new customer using
the TwisterTM plattform is Huntington Bancshares Inc. The bank is one of the
largest regional banks in the US with 600 branch offices and offers Internet
based cash management and banking services using the Twister platform. In
Germany, we have also won an innovative e-business project with WestLB. WestLB
is a German bank and among the largest banks of Europe. The bank is using Brokat
technology as the basis for its new Internet-based cash management system.
Brokat goes Mobile
The Mobile Revolution has its own distinctive handwriting. That is the message
of the first global campaign on the subject of Mobile Business, which Brokat and
the other members of the Mobile Electronic Signature Consortium launched in
April. The goal of the campaign was to further establish Brokat as a worldwide
leader in IT and to promote its new Mobile Business activities. The centerpiece
of the campaign was a major insert published in leading international business
media, including the Frankfurter Allgemeine Zeitung, Financial Times, Wall
Street Journal and the South China Morning Post. We are already seeing the
rewards of this campaign. For example, we have concluded a partnership in Asia
with Mastercard and Siemens, in which the three leading companies are pooling
their know-how to build the world's first complete mobile commerce system. Using
this system, companies can offer services such as payment or auctions to their
customers via the customers' mobile phones. An additional component of our
mobile business activities was unveiled at the SAP Sapphire fair in Berlin,
where we demonstrated how mobile terminals can be securely linked to my.SAP.com
solutions, and how an SAP system can be accessed via a WAP mobile phone using
Twister. The Mobile Electronic Signature Consortium, which we launched in
December of last year, continues to grow. Eleven new international members had
joined by late May, including the Bank of Tokyo-Mitsubishi, Cable & Wireless,
Hewlett-Packard and Mitsubishi Electric Corporation. The Consortium now includes
25 international mobile telephone and IT companies and is promoting the
definition of a worldwide standard for digital signatures using mobile devices.
New Partners
An important objective of our partnering activities is to link up with
internationally recognized and influential partners. We took another step toward
achieving this objective in April, when we signed a worldwide strategic
partnership agreement with Bull, the French information technology company. Bull
will use the Twister platform and offer it in combination with its extensive
know-how as part of its system integration and consulting services in the
financial services market. In the context of this partnership,
<PAGE>
5
Bull will continue to invest in recruiting and training programs over a
three-year period. More than 100 developers and consultants are being trained
specifically in the integration of Brokat products for the realization of
e-finance solutions. We are also cooperating in the development of new
technologies, in particular to enhance Bull's know-how in the fields of advanced
server technology, security, network management and smart card solutions. For
this purpose, Bull plans to establish two competency centers in Great Britain
and France.
Italian Subsidiary Established
We continued to expand our presence in the European market by establishing a
subsidiary in Italy. The primary target groups in Italy include financial
services providers and Internet service providers. Because of the popularity of
mobile phones in Italy, we consider the Italian market especially attractive for
our m-business solutions, such as Mobile Payment and Mobile Banking.
Shareholders' Meeting approves Employee Stock Ownership Program and change of
Corporate Name At the company's second Shareholders' Meeting on May 26 in
Stuttgart, Germany, the more than 300 shareholders adopted a series of
resolutions, including a change in the name of the company from Brokat
Infosystems AG to Brokat AG. Another important item on the agenda was the
adoption of a new Employee Stock Ownership program. Brokat is enhancing its
attractiveness as an employer by issuing a convertible bond. This new program
will not result in any expenditure effecting results of the company, as was the
case with the stock options program adopted previously. To service the
conversion into shares by the participants in the program, the shareholders also
approved a conditional capital increase by up to 2.6 million Euro. At the same
time, the management board was authorized to acquire treasury shares in the
amount of up to ten percent of the company's capital stock. Financial
Information The consolidation of Fernbach Financial Software S.A., a Luxembourg
company, was completed as of May 19 of this year. Fernbach's revenues will be
included in Brokat's consolidated revenues from that date forward. Compared to
the first six months of 1999, revenues increased by 91% from TDM 42,816 to TDM
81,729 in the first six months of 2000.
On a quarterly basis, revenues increased by 72% from TDM 25,173 in the Q2 1999
to TDM 43,247 in Q2 2000. This increase was achieved in spite of an intended
reduction in sales from tradable goods from the unusually high level in Q2 1999.
Due to a hardware sale to a strategically important partner, tradable good
reached 40% of revenues in Q2 1999, which is atypical of Brakat's revenue
structure. In Q2 2000 revenues from the sale of tradable goods could be
successfully reduced to 1% of averall sales.
Revenues from licensing increased by 147% in the first half of 2000 to TDM
38,499 or 47% of total revenue compared to the same six-month period of the
previous year. On a quarterly basis, licensing revenue therefore tripled from
TDM 6,450 in the second quarter of 1999
<PAGE>
6
to TDM 19,528 in the second quarter of 2000. Revenues from Customer Support and
Professional Services increased by 158% and 153% respectively to TDM 8,891 and
TDM 31,094 in the first six months of 2000.
Revenues from international sales increased by 526% compared to the prior-year
period, from TDM 7,707 or 18% of total revenues in the first six months of 1999
to TDM 48,254 or 59% of total revenues in the first six months of 2000. On a
quarter-to-quarter comparative basis, international revenues increased by 341%
from the second quarter of 1999 to the second quarter of 2000. Revenues from the
US have increased particularly strongly over the last two quarters. In the first
six months of 2000, the US became the second strongest revenue generator behind
Germany, where the company earns the majority of its revenues. The US accounted
for 12.6% of total revenues, followed by Great Britain at 12.0%. In the second
quarter of 2000, 14.8% of revenues were generated in the US.
In spite of the strong growth of international projects, which are handled
predominantly by our own Professional Services Teams, partner revenues also
increased by 26% on a six months basis compared to the same period of the
previous year, from TDM 16,787 in 1999 to TDM 21,127 in 2000, and by 50% based
on a quarterly comparison from TDM 6,024 in the second quarter of 1999 to TDM
10,716 in the second quarter of 2000.
The unusually high revenues from the sale of tradable goods in the second
quarter of 1999 also had an effect on the gross profit margin of that quarter,
which, contrary to the trend, was only 38.6%. In the second quarter of this
year, a margin of 60.8% could be achieved which resulted in the current
six-month margin of 59.8%, compared to a 51.1% margin from the six-month period
of the previous year.
Since the consolidation of MeTechnology and TST in the second half of 1999,
there has been a resulting increase in research and development (R&D) expenses.
Therefore, R&D expenses increased from 11% of revenues in the first six months
of 1999 (TDM 4,837) to 26% of revenues (TDM 21,437) in the first six months of
2000.
As a result of increased legal fees and consulting costs in the context of
Brokat's expansion strategy and administrative costs for the establishment of
additional subsidiaries, general and administrative expenses on a six-month
basis increased from 15% to 19% of revenues.
As expected, sales and marketing costs increased in the context of our
international expansion plan during the second quarter of 2000. The increase
resulted from intensified marketing activities and new hires in sales and
marketing. Nevertheless, the selling expenses could be decreased from 54% to 44%
of revenues in the first six months of 2000, compared to the first six months of
1999.
<PAGE>
7
Mainly as a result of our expansive marketing strategy the EBITDASO margin
changed as expected from -22% in the first six months of the prior year (TDM
-9,334) to -24% (TDM -19,980) in the comparable period of this year. The costs
of amortizing goodwill and the costs of the employee stock ownership program,
which are shown in the profit & loss statement but have no effect on the
company's liquidity, were TDM -15,184 and TDM -30,735 in the first six months of
2000, compared to TDM -4,020 and TDM -10,280 respectively for the first six
months of 1999. Net income was therefore TDM -76,686 for the first six months of
2000, compared to TDM -25,394 for the first six months of 1999.
The cash flow statement as of the end of the first six months of 2000 is
characterized, as in the first quarter, by the bond issue in the amount of 125
million Euro placed in March and a net capital inflow of DM 237 million. The
investment by Intel announced late last year also became legally binding on May
12, 2000, resulting in a capital inflow of 10 million Euro.
On the investment side, Brokat acquired
a 1.4% interest for DM 5.5 million in the Belgian company Customer Dialogue
Systems nv. After reduction of "short-term bank loans" from TDM 42,271 to TDM
174 and the repayment of TDM 5,665 in "other short-term debt", the company had
TDM 163,856 in cash as of the end of the first six months of 2000.
The increase in "trade accounts receivable" to TDM 63,419 as reflected in the
consolidated balance sheet is partly the result of large orders that include
long payment terms. In addition, the application of the "percentage of
completion" method results in a duplicate item in "accounts receivable" and in
"billings in excess of cost and estimated earnings on uncompleted contracts."
The offsetting of these two items results in a better comparable number with
respect to the revenue development.
"Prepaid expenses and other current assets" increased to TDM 21,781 due to
accruals entries for consultancy fees in connection with the bond issue. At the
same time, the item "other accrued expenses and current liabilities" increased
to TDM 17,217 as a result of the assignment of interest costs associated with
the bond issue to other accounting periods. After the acquisition of Fernbach
Financial Software S.A., total assets as of June 30, 2000, were TDM 496,167. The
equity ratio was 39%.
Number of Employees
The number of employees continued to increase as a result of the company's
ongoing expansion efforts. New hires and the consolidation of Fernbach S.A.,
Luxembourg, which was formally completed on May 19, 2000, increased the number
of Brokat's employees worldwide from 631 in the first quarter to 814 in the
second quarter of 2000.
The majority of growth in the second quarter took place in two key areas. The
Sales and Marketing Division added 38 new employees, bringing its total to 185.
The Research and
<PAGE>
8
Development Division had already increased the number of employees to 201 in the
first quarter to prepare for future projects, and added another 56 new employees
in the second quarter, primarily as a result of the consolidation of Fernbach,
for a total of 257 employees.
The merger between MeTechnology AG, Germany, with Brokat AG, Germany, was also
completed on May 29, 2000. For the reporting period the total number of
employees from both companies is shown a 430 for Brokat AG, Germany, which
represents an effective increase of 29 employees.
In the international subsidiaries, the US subsidiary added 28 employees, the
Austrian subsidiary added 5 and Brokat Asia in Singapore added 3 new employees.
A new subsidiary, Brokat s.r.l., Italy, was also established with 4 employees.
<PAGE>
9
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTH ENDED JUNE
30, 2000 AND 1999 AND FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(ACCORDING TO US-GAAP)
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
II. Quarter II. Quarter Six months Six months
2000 1999 ended ended
April 1 - April 1 - June June
June 30, 2000 June 30, 1999 30, 2000 30, 1999
DM '000 DM '000 TDM TDM
======================================================================================================================
<S> <C> <C> <C> <C>
Licences 19,528 6,450 38,499 15,598
Tradable goods 406 10,118 3,207 11,447
Professional services 18,365 6,797 31,094 12,275
Customer support 4,945 1,752 8,891 3,440
Other 3 56 38 56
----------------------------------------------------------------------------------------------------------------------
Total sales 43,247 25,173 81,729 42,816
----------------------------------------------------------------------------------------------------------------------
Cost of sales -16,966 -15,462 -32,870 -20,954
----------------------------------------------------------------------------------------------------------------------
Gross profit 26,281 9,711 48,859 21,862
----------------------------------------------------------------------------------------------------------------------
Selling expenses -20,679 -13,379 -36,283 -23,313
General and administrative expenses -8,659 -4,046 -15,725 -6,547
Research and development -11,328 -2,874 -21,437 -4,837
Operating result (without goodwill 14,385 -10,588 -24,586 -12,835
amortization and non-cash charges from
employee stock options)
Other income and expenses, net1) -2,107 2,156 460 1,711
Minority interest 36 59 99 90
----------------------------------------------------------------------------------------------------------------------
EBITDASO2) 14,662 7,433 -19,980 -9,334
----------------------------------------------------------------------------------------------------------------------
Depreciation included in the operating -1,794 -940 -4,047 -1,700
expenses
Amortization of goodwill and
Intangible assets from acquisitions -8,026 -4,020 -15,184 -4,020
Non cash charges associated with stock -10,378 -5,140 -30,735 -10,280
option grants
----------------------------------------------------------------------------------------------------------------------
EBIT -34,860 -17,533 -69,946 -25,334
----------------------------------------------------------------------------------------------------------------------
Net interest -5,582 -275 -6,410 53
----------------------------------------------------------------------------------------------------------------------
Income before taxes -40,442 -17,808 -76,356 -25,281
----------------------------------------------------------------------------------------------------------------------
Income taxes, net 22 -113 -227 -113
Other taxes, net -92 0 -103 0
===============
Net loss -40,512 -17,921 2 -76,686 -25,394
----------------------------------------------------------------------------------------------------------------------
Basic and diluted loss per share -1.50 -0.91 -2.84 -1.29
Weighted average number of common shares 27,083,699 19,694,650 26,966,236 19,694,650
outstanding 6 0
</TABLE>
1) includes gain/ losses from currency exchnge translations from revaluation
of receivables/ liabilities in foreign currency
<PAGE>
10
2) EBITDASO = Earnings before Interest, Tax, Depreciation, Amortization and
Stock Options
<PAGE>
11
CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2000 AND DECEMBER
31, 1999
(ACCORDING TO US-GAAP)
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
JUNE 30, DECEMBER 31,
2000 1999
DM '000 DM '000
-------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 163,856 6,963
Accounts receivable, trade 63,419 36,187
Cost and estimated earnings in excess of billings on uncompleted 2,965 1,965
contracts
Advances on purchase commitments 0 3,000
Prepaid expenses and other current assets 21,781 6,795
Total current assets 252,021 54,910
Computer equipment 19,080 12,813
Furniture and fixtures 9,699 5,296
Less: accumulated amortization -14,397 -8,607
---------------------------------------
14,382 9,502
---------------------------------------
Goodwill 245,267 188,887
Other intangible assets 10,130 8,448
Less: accumulated amortization -36,627 -20,547
---------------------------------------
218,770 176,788
---------------------------------------
Investments in associated companies 0 4,139
Other long-term investments 6,631 1,013
Deferred income taxes 4,363 2,333
---------------------------------------
TOTAL ASSETS 496,167 248,685
=======================================
</TABLE>
<PAGE>
12
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
DM '000 DM '000
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term debt to banks 174 42,271
Other Short-term debt 0 5,665
Accounts payable, trade 8,391 5,043
Payroll related accruals 8,852 5,296
Tax-related accruals 4,096 2,150
Billings in excess of cost and estimated earnings on
uncompleted contracts 5,546 1,818
Other accrued expenses and current liabilities 17,217 6,264
Deferred income 4,853 3,579
Deferred income taxes 4,025 2,377
---------------------------------------
TOTAL CURRENT LIABILITIES 53,154 74,463
---------------------------------------
Long-term debt to bank 2,000 2,000
Other long-term debt 246,596 1,850
TOTAL LIABILITIES 301,750 78,313
Minority interest 326 426
SHAREHOLDERS' EQUITY:
Common Stock 53,416 52,512
Additional paid-in capital 449,336 343,260
Accumulated deficit -185,719 -109,064
Deferred compensation -118,809 -113,376
Accumulated other comprehensive income (loss) -4,133 -3,386
TOTAL SHAREHOLDERS' EQUITY 194,091 169,946
---------------------------------------
Total liabilities and shareholders equity 496,167 248,685
=======================================
</TABLE>
<PAGE>
13
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTH ENDED JUNE 30, 2000 AND
JUNE 30, 1999 (ACCORDING TO US-GAAP)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
SIX MONTH ENDED
JUNE 30, 2000 JUNE 30, 1999
DM '000 DM '000
---------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss -76,686 -25,394
Adjustments to reconcile net loss to net cash used in operating activities
Minority interest -99 -90
Depreciation and amortization 19,231 5,720
Gain on disposal of property and equipment 0 -2
Deferred income taxes -381 0
Non-cash charges associated with stock option grants 30,735 10,280
Changes in operating assets and liabilities:
Accounts receivable -23,963 -20,247
Net changes in cost and estimated earnings in
excess of billings 3,823 3,186
Prepaid expenses and other current assets -11,378 790
Accounts payable, trade 2,676 3,459
Payroll and tax related accruals 2,796 2,050
Other accrued expenses and liabiltities 9,613 -3,123
Deferred income -1,998 -319
--------------------------------------------
Net cash used in operating activities -45,631 -23,690
--------------------------------------------
CASH FLOW FROM INVESTING ACTIVITIES
Acquisitions of intangible assets -1,124 -4,745
Purchases of property and equipment -6,607 -2,694
Purchases of investments -5,357 0
Acquisitions, net of cash acquired 1,132 -29,431
Proceeds from sale of property and equipment 0 293
--------------------------------------------
Net cash used in investing activities -11,956 -36,577
--------------------------------------------
CASH FLOW FROM FINANCING ACTIVITIES
Net change in short-term debt -47,761 0
Proceeds from debt issuances 244,744 0
Proceeds from secondary offering net of costs 18,244 219
--------------------------------------------
Net cash provided by financing activities 215,227 219
--------------------------------------------
EFFECT OF EXCHANGE RATE DIFFERENCES ON CASH -747 -1,650
</TABLE>
<PAGE>
14
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS 156,893 -61,698
At the beginning of the period 6,963 68,839
At the end of the period 163,856 7,141
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for:
Interest 867 616
Income taxes 0 0
---------------------------------------------------------------------------------------------------------
</TABLE>
Effective as of May, 2000 Brokat Ag exercised its option to acquire the
remaining 74.9 % of interest in Fernbach Financial Software S. A., Luxembourg
through the issuance of 182,838 of the Company's common shares. TDM 148 of
incidental acquisition costs were paid in cash.
<PAGE>
15
EMPLOYEE STRUCTURE AS OF JUNE 30, 2000 AND A OF MARCH 31, 2000
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
JUNE 30, MARCH 31
2000 2000
-------------------------------------------------------------------------------------------------------
<S> <C> <C>
Brokat AG, Germany 430 279
Brokat Infosystems Ges.m.b.H., Austria 13 8
Brokat Systeme AG, Switzerland 7 5
Brokat Infosystem s.a.r.l. Luxembourg 10 9
Brokat Ltd., UK 37 37
Brokat s.r.l., Italy 4 0
Brokat Americas Inc., USA 141 113
Brokat Asia Pte. Ltd., Singapore 38 35
Brokat Australasia Pty.Ltd., (Australia and Newzealand) 6 5
Brokat Japan Ltd., Japan 7 7
MeTechnology Kft, Hungary 11 11
MeTechnology AG, Germany1) 0 122
Fernbach Financial Software S. A., Luxembourg2) 110 0
-------------------------------------------------------------------------------------------------------
BROKAT TOTAL 814 631
-------------------------------------------------------------------------------------------------------
- Finance & Organization 137 93
- Research & Development 257 201
- Customer & Professional Service 235 190
- Marketing/ Productmanagement/ Sales 185 147
</TABLE>
1) The merger of MeTechnology AG into BROKAT AG, Germany has been completed by
May 29, 2000
2) Fernbach Financial Software S. A., Luxembourg has been consolidated as of May
19, 2000
<PAGE>
16
Outlook
Brokat's fiscal year 2000 will continue to be characterized by globalization.
The planned acquisitions of the US companies Blaze and GemStone should
significantly improve Brokat's positioning in the US market. Brokat is thereby
adding important functionality and components that will complement its core
product, TwisterTM. The two new companies provide products and technology that
allow Brokat to implement complete customer solutions even more rapidly. The
acquisitions will make it possible to keep expanding Brokat's position as one of
the leading companies in the global m-commerce marketplace.
Legend for SEC-Filing in context with
Brokat's acquisition
of
Blaze Software, Inc.
Filings with the US SEC
Brokat plans to file a Registration Statement on Form F-4 with the US SEC in
connection with the Blaze transaction. The Form F-4 will contain an exchange
offer prospectus, a proxy statement for Blaze's special meeting and other
documents. Blaze plans to mail the proxy statement/prospectus contained in the
Form F-4 to its stockholders. The Form F-4 and proxy statement/prospectus will
contain important information about Brokat, Blaze, the Blaze transaction and
related matters. Investors and stockholders should read the proxy
statement/prospectus and the other documents filed with the US SEC in connection
with the Blaze transaction carefully before they make any decision with respect
to the Blaze transaction. A copy of the merger agreement with respect to the
Blaze transaction has been filed by Blaze as an exhibit to its Form 8-K dated
June 20, 2000. The Form F-4, the proxy statement/prospectus, the Form 8-K and
all other documents filed with the US SEC in connection with the transaction
will be available when filed free of charge at the US SEC's web site at
www.sec.gov. In addition, the proxy statement/prospectus, the Form 8-K and all
other documents filed with the US SEC in connection with the Blaze transaction
will be made available to investors free of charge by calling or writing to:
Brokat AG
Silke Simon
Head of Investor Relations
Industriestr.3
70565 Stuttgart, Germany
Phone: +49-711-78844 298
Email: [email protected]
<PAGE>
17
Blaze Software, Inc.
Gary Shroyer
Investor Relations Department
150 Almaden Blvd.
San Jose, CA 951134
(408) 535-1757
In addition to the Form F-4, the proxy statement/prospectus and the other
documents filed with the US SEC in connection with the Blaze transaction, Blaze
is obligated to file annual, quarterly and special reports, proxy statements and
other information with the US SEC. You may read and copy any reports, statements
and other information filed with the US SEC at the US SEC's public reference
rooms at 450 Fifth Street, N.W., Washington, D.C. 20549 or at the other public
reference rooms in New York, New York and Chicago, Illinois. Please call the US
SEC at 1-800-SEC-0330 for further information on public reference rooms. Filings
with the US SEC also are available to the public from commercial
document-retrieval services and at the web site maintained by the US SEC at
http//www.sec.gov.
Solicitation of Proxies; Interests of Certain Persons in the Transaction
The identity of the people who, under SEC rules, may be considered "participants
in the solicitation" of Blaze stockholders in connection with the proposed
merger, and a description of their interests, is available in an SEC filing on
Schedule 14A made by Blaze on June 21, 2000.
Forward-Looking Statements
This release contains statements that constitute forward looking statements
within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.
Forward looking statements are statements other than historical information or
statements of current condition. These statements appear in a number of places
in this release and include statements concerning the parties' intent, belief or
current expectations regarding future events, including: the transactions; other
transactions to which the parties may be a party; competition in the industry;
changing technology and future demand for products; changes in business strategy
or development plans; ability to attract and retain qualified personnel;
worldwide economic and business conditions; regulatory, legislative and judicial
developments; financing plans; and trends affecting the parties' financial
condition or results of operations. Forward looking statements are not
guarantees of future performance and involve risks and uncertainties, and actual
results may differ materially from those in the forward looking statements as a
result of various factors. Although management of the parties believe that their
expectations reflected in the forward looking statements are reasonable based on
information currently available to them, they cannot assure you that the
expectations will prove to have been correct.
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Accordingly, you should not place undue reliance on these forward looking
statements. In any event, these statements speak only as of the date of this
release. The parties undertake no obligation to revise or update any of them to
reflect events or circumstances after the date of this release, or to reflect
new information or the occurrence of unanticipated events. Readers are referred
to Blaze's Annual Report to Stockholders and Brokat's and Blaze's other filings
with the US SEC for a discussion of these and other important risk factors
concerning the parties and their respective operations.
