<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________to__________
Commission File Number 0-25215
WEBTRENDS CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C>
OREGON 93-1123283
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
</TABLE>
851 SW SIXTH AVENUE, SUITE 1200
PORTLAND, OREGON 97204
(Address of principal executive offices)
(503) 294-7025
(Registrant's telephone number)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes [X] No[ ]
The number of shares of common stock, no par value, outstanding on July
31, 2000, was 26,196,233.
<PAGE> 2
WEBTRENDS CORPORATION
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NO.
---------------------------------------------------------------------------------------------------------
<S> <C> <C>
Item 1. Condensed Consolidated Financial Statements
Condensed consolidated Balance Sheets at June 30, 2000 and December 31, 1999......3
Condensed consolidated Statements of Operations for the three and six
months ended June 30, 2000 and 1999.............................................4
Condensed consolidated Statements of Cash Flows for the six months
ended June 30, 2000 and 1999....................................................5
Notes to condensed consolidated financial statements..............................6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations...............................................7
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds...........................................13
Item 4. Submission of Matters to vote of Security Holders...................................13
Item 6. Exhibits and Reports on Form 8-K....................................................13
Signatures ....................................................................................14
</TABLE>
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PART I -- FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
2
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WEBTRENDS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, 2000 DECEMBER 31, 1999
------------- -----------------
(UNAUDITED) (AUDITED)
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 24,659,719 $ 29,397,650
Short-term investments 58,511,895 49,885,523
Accounts receivable, net 10,623,215 4,968,544
Prepaid expenses and other 2,826,722 1,547,119
------------- -------------
TOTAL CURRENT ASSETS 96,621,551 85,798,836
Property and equipment, net 6,078,104 2,375,750
Other assets 1,755,419 2,060,662
------------- -------------
TOTAL ASSETS $ 104,455,074 $ 90,235,248
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,021,723 $ 1,161,679
Accrued liabilities 5,969,569 4,117,515
Accrued income taxes 1,230,995 297,397
Deferred revenue 9,299,028 4,122,882
------------- -------------
TOTAL LIABILITIES 18,521,315 9,699,473
------------- -------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Preferred stock, no par value. Authorized, 15,000,000 shares;
no shares outstanding - -
Common stock, no par value. Authorized 300,000,000 shares;
26,172,120 and 25,817,568, issued and outstanding at June 30,
2000 and December 31, 1999, respectively 79,605,339 77,661,491
Deferred compensation, net (337,261) (405,391)
Retained earnings 6,665,681 3,279,675
------------- -------------
TOTAL SHAREHOLDERS' EQUITY 85,933,759 80,535,775
------------- -------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 104,455,074 $ 90,235,248
============= =============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
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WEBTRENDS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------ -----------------------------
2000 1999 2000 1999
------------ ------------ ------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Revenue:
Software licenses $ 10,818,060 $ 3,381,988 $ 19,221,614 $ 5,968,961
Support services 2,700,874 624,593 4,677,090 1,043,946
------------ ------------ ------------ ------------
Total revenue 13,518,934 4,006,581 23,898,704 7,012,907
Cost of revenue 1,571,857 343,141 2,640,517 633,451
------------ ------------ ------------ ------------
Gross margin 11,947,077 3,663,440 21,258,187 6,379,456
------------ ------------ ------------ ------------
Operating expenses:
Research and development 2,163,833 759,863 4,060,258 1,398,996
Sales and marketing 6,380,737 2,156,663 11,347,758 3,662,201
General and administrative 1,951,544 561,675 3,216,053 1,017,140
------------ ------------ ------------ ------------
Total operating expenses 10,496,114 3,478,201 18,624,069 6,078,337
------------ ------------ ------------ ------------
Income from operations 1,450,963 185,239 2,634,118 301,119
------------ ------------ ------------ ------------
Other income (expense), net
Interest income 1,406,575 657,977 2,639,439 844,880
Interest expense - (1,867) - (19,719)
------------ ------------ ------------ ------------
Other income, net 1,406,575 656,110 2,639,439 825,161
------------ ------------ ------------ ------------
Income before income taxes 2,857,538 841,349 5,273,557 1,126,280
Provision for income taxes 983,245 315,777 1,887,551 422,627
------------ ------------ ------------ ------------
Net income $ 1,874,293 $ 525,572 $ 3,386,006 $ 703,653
============ ============ ============ ============
Net income per share:
Basic $ 0.07 $ 0.02 $ 0.13 $ 0.03
============ ============ ============ ============
Diluted $ 0.07 $ 0.02 $ 0.12 $ 0.03
============ ============ ============ ============
Weighted average shares:
Basic 26,099,373 23,862,578 25,999,374 21,525,798
============ ============ ============ ============
Diluted 28,245,059 26,349,304 28,481,931 23,974,716
============ ============ ============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
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WEBTRENDS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30,
--------------------------------
2000 1999
---------------- --------------
(Unaudited)
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 3,386,006 $ 703,653
Adjustment to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 702,917 188,398
Provision for doubtful accounts 356,000 60,000
Amortization of deferred compensation 68,130 73,072
Tax benefit from employee stock option plans 1,130,515 359,621
Changes in assets and liabilities, net of
assets acquired:
Accounts receivable (5,389,040) (1,338,140)
Prepaid expenses and other 780,520 269,079
Accounts payable 190,078 8,781
Accrued liabilities 1,713,597 651,476
Accrued income taxes 933,598 -
Deferred revenue 5,176,146 1,648,690
------------ ------------
Net cash provided by operating activities 9,048,467 2,624,630
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment (4,202,121) (846,684)
Business acquisition, net of cash acquired (1,771,238) -
Purchase of investments, net (8,626,372) (30,335,788)
------------ ------------
Net cash used for investing activities (14,599,731) (31,182,472)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock - 74,037,698
Stock issued pursuant to benefit plans 813,333 199,674
Principal payments on borrowings from shareholders - (150,000)
------------ ------------
Net cash provided by financing activities 813,333 74,087,372
------------ ------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (4,737,931) 45,529,530
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 29,397,650 1,098,847
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 24,659,719 $ 46,628,377
============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
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WEBTRENDS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying consolidated financial statements have been prepared in
conformity with generally accepted accounting principles. However, certain
information or footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed, or omitted, pursuant to the rules and
regulations of the Securities and Exchange Commission. In the opinion of
management, the statements include all adjustments necessary (which are of
a normal and recurring nature) for the fair presentation of the results of
the interim periods presented. These consolidated financial statements
should be read in conjunction with the audited financial statements for
the year ended December 31, 1999. Certain prior period amounts have been
reclassified to conform to the presentation in the current year.
2. Net Income Per Common and Common Equivalent Share
Basic and diluted net income per share are computed using the weighted
average number of common shares outstanding during the period, with
diluted net income per share including the effect of potentially dilutive
common stock equivalents. Dilutive common equivalent shares consist of
stock options. Basic and diluted net income per share have been calculated
using the treasury stock method in accordance with SEC Staff Accounting
Bulletin No. 98.
3. Research and Development Costs
Software development costs have been accounted for in accordance with
Statement of Financial Accounting Standards No. 86, Accounting for the
Costs of Computer Software to be Sold, Leased or Otherwise Marketed. Under
the standard, capitalization of software development costs begins upon the
establishment of technological feasibility, subject to net realizable
value considerations. To date, the period between the achievement of
technological feasibility and the general availability of such software
has been short; therefore, software development costs qualifying for
capitalization have been immaterial and have been charged to research and
development expense.
4. Cash, Cash Equivalents, and Short-term Investments
The Company classifies highly liquid investments purchased with an
original maturity of three months or less as cash equivalents. Short-term
investments consist of certificates of deposit, commercial paper and other
highly liquid investments with original maturities in excess of three
months, and primarily less than one year. All investments are classified
assuming they will be held to maturity and are recorded at amortized cost,
which approximates market value.
5. Acquisition of United Kingdom Distributor
On June 30, 2000, the Company acquired all the outstanding stock of
OpenSoft Communications Ltd., the Company's United Kingdom distributor,
for $1.7 million in cash and incurred approximately $150,000 in expenses.
The acquisition has been accounted for as a purchase and resulted in
approximately $1.8
6
<PAGE> 8
million in goodwill which is being amortized on a straight-line basis over
7 years. An acquisition related charge of $317,500 was also recorded in
the three-month period ended June 30, 2000, and is included as a component
of general and administrative expense. The Company's June 30, 2000 balance
sheet includes the purchased assets and assumed liabilities of the
acquired distributor, however, since the deal closed on the last day of
the quarter, there was no impact on the Company's financial results for
the three- or six-month periods ended June 30, 2000.
7
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD-LOOKING INFORMATION
Certain statements in this Form 10-Q contain "forward-looking" information
(as defined in Section 27A of the Securities Act of 1933, as amended) that
involve risks and uncertainties which may cause actual results to differ
materially from those predicted in the forward-looking statements. In
particular, there are forward-looking statements concerning the Company's
expectations for expense levels in both absolute and relative dollars during
future periods. Forward-looking statements can be identified by their use of
such verbs as expects, anticipates, believes or similar verbs or conjugations of
such verbs. If any of the Company's assumptions on which the statements are
based prove incorrect or should unanticipated circumstances arise, the Company's
actual results could materially differ from those anticipated by such
forward-looking statements. The differences could be caused by a number of
factors or combination of factors including but not limited to, the risks
detailed in the "Business - Risk Factors" section of the Company's Annual Report
on Form 10-K filed on March 30, 2000.
OVERVIEW
WebTrends is a leading provider of enterprise class software and eServices
solutions for Visitor Relationship Management(TM), eBusiness Intelligence and
Systems Management. WebTrends' solutions deliver essential information to key
departments across an enterprise, including marketing, sales, executive
management, information services, security, customer service, finance and human
resources. Our solutions are used by thousands of customers such as Internet
service providers (ISPs), government entities, educational institutions and
corporate clients.
WebTrends was incorporated in Delaware in 1993 and reorganized in Oregon
in 1997. An initial public offering was completed in February 1999 and a
follow-on offering was completed in May 1999. Our common stock is listed on the
Nasdaq National Market under the symbol "WEBT."
WebTrends, WebTrends Commerce Trends, WebTrends Enterprise Reporting
Server and Visitor Relationship Management are either registered trademarks or
trademarks of WebTrends Corporation. All other names mentioned herein may be
trademarks of their respective owners.
RESULTS OF OPERATIONS
REVENUE
Software license revenue consists of fees for licenses of WebTrends'
software products while support services revenue consists of annual
subscriptions for upgrades, post-sale customer support services, and
professional consulting services.
Total revenue increased 237.4% to $13.5 million for the second quarter of
2000 from $4.0 million for the second quarter of 1999, and 240.8% to $23.9
million for the six months ended June 30, 2000 from $7.0 million for the six
months ended June 30, 1999. Primary contributing factors for these changes are
discussed below.
8
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Software Licenses
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<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
Software Licenses $ 10,818 $ 3,382 219.9% $ 19,222 $5,969 222.0%
Percent of Revenues 80.0% 84.4% 80.4% 85.1%
</TABLE>
WebTrends continues to benefit from a very strong market for Internet
infrastructure products and the strategic contribution of our solutions to our
customers' eBusiness success. Software license revenue increased as a result of
continued strong growth across each of our product categories as new releases of
existing products in late 1999 and early 2000 gained increasing customer
acceptance. The large investment we made in significantly increasing our sales
force to more than 60 as of June 30, 2000 also increased sales for the three and
six-month periods ended June 30, 2000. Despite the fast growth in software
license revenue, the pace of growth in support services was even more rapid and,
as a consequence, software license revenue decreased as a percentage of total
revenue in the three and six month periods ended June 30, 2000, compared to the
prior year periods.
Support Services
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
Support Services $ 2,701 $ 625 332.4% $ 4,677 $1,044 348.0%
Percent of Revenues 20.0% 15.6% 19.6% 14.9%
</TABLE>
The increase in support services revenue resulted primarily from increased
subscription revenue derived from continued growth in the installed base of
customers, as well as the sale of consulting, training and support services
associated with the sale of our new Enterprise Reporting Server and Commerce
Trends products. To support these new products we grew our support services
staff to more than 60 as of June 30, 2000.
Cost of Revenue
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
Cost of Revenue $ 1,572 $ 343 358.1% 2,641 $ 633 316.8%
Percent of Revenues 11.6% 8.6% 11.0% 9.0%
</TABLE>
Cost of revenue includes product packaging, software documentation,
duplication, labor, and other costs associated with product fulfillment,
royalties associated with the sale of WebTrends' products, and costs associated
with providing technical support and consulting services to customers. The
increase in cost of revenue resulted primarily from the hiring of customer
support and professional services personnel to meet the demands of a larger
customer base and to manage and perform consulting and training services.
9
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OPERATING EXPENSES
We continue to believe that strategic investment in all areas of our
business is required, and we anticipate that expenses will increase in absolute
dollars in future periods. Expenses in each category may vary as a percent of
revenues and relative to one another as we continue to take advantage of
strategic hiring and investing opportunities.
Research and Development
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
Research and Development $ 2,164 $ 760 184.8% $ 4,060 $ 1,399 190.2%
Percent of Revenues 16.0% 19.0% 17.0% 19.9%
</TABLE>
Research and development expenses consist primarily of salaries and
related costs associated with developing new products, enhancing existing
products, and performing quality assurance and documentation activities. The
increase in research and development expenses in absolute dollars is primarily
attributable to increasing the number of research and development employees to
more than 80 as of June 30, 2000. Research and development expenses decreased as
a percentage of total revenue primarily due to the rapid growth in total
revenue. We continue to believe that significant investment in research and
development is required to remain competitive in our markets, and anticipate
that research and development expenses will increase in absolute dollars in
future periods, but may vary as a percent of total revenue.
Sales and Marketing
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
Sales and Marketing $ 6,381 $ 2,157 195.9% $11,348 $ 3,662 209.9%
Percent of Revenues 47.2% 53.8% 47.5% 52.2%
</TABLE>
The increase in sales and marketing expense is primarily attributable to
the cost of hiring and maintaining additional sales and marketing personnel,
including employees to expand the direct sales force and to support indirect
distribution channels. Sales and marketing expenses decreased as a percentage of
sales as the increased costs associated with building the sales force were more
than offset by the increases in sales resulting from the headcount increase. We
expect sales and marketing expenses will continue to increase in absolute
dollars as we continue to expand our marketing programs and sales force to
increase brand awareness, but they may vary as a percent of total revenue.
10
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General and Administrative
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- --------------------------------
2000 1999 Change 2000 1999 Change
(Dollar amounts in thousands)
<S> <C> <C> <C> <C> <C> <C>
General and Administrative $ 1,952 $ 562 247.5% $3,216 $1,017 216.2%
Percent of Revenues 14.4% 14.0% 13.5% 14.5%
</TABLE>
General and administrative expenses consist primarily of salaries and
other employee-related costs for executive, financial, human resources, and
infrastructure personnel. General legal and accounting services, insurance and
general facility costs are also included within general and administrative
expenses. The three and six month periods ended June 30, 2000 include a charge
of $317,500 related the acquisition of OpenSoft Communications Ltd. The increase
in absolute dollars, excluding the acquisition charge, is primarily attributable
to our growth and expansion, which included adding 17 accounting and
administrative personnel since June 30, 1999 as well as expanding infrastructure
and facilities. We expect general and administrative expenses will continue to
increase in absolute dollars to support the anticipated expansion of sales and
operations, but they may vary as a percent of total revenue.
INCOME TAXES
Income tax provisions for the three and six month periods ended June 30,
2000 reflect estimated effective tax rates of 34.4% and 35.8%, respectively
while income tax provisions for the three and six month periods ended June 30,
1999 reflect estimated effective tax rates of 37.5%. The decrease is primarily
due to increased utilization of research and development tax credits associated
with the Company's investment in developing new products. The effective tax rate
is subject to change in future periods as circumstances affecting the tax rate
change.
LIQUIDITY AND CAPITAL RESOURCES
WebTrends had cash and cash equivalents and short-term investments of
$83.2 million at June 30, 2000, which represents the Company's primary source of
liquidity, and working capital of approximately $78.1 million.
Our primary market risk exposure is the impact of interest rate
fluctuations on interest income earned on our investment portfolio. The risks
associated with market, liquidity and principal are mitigated by investing in
high-credit quality securities and limiting concentrations of issuers and
maturity dates. Derivative financial instruments are not part of our investment
portfolio. We currently have no debt instruments or credit facilities.
Cash and cash equivalents and short-term investments increased by $3.9
million during the six months ended June 30, 2000, primarily as a result of cash
generated by operating and financing activities. Net cash provided by operating
activities was approximately $9.0 million for the six months ended June 30,
2000, and resulted primarily from profitable operations, increased deferred
revenues and accrued income taxes, partially offset by increased accounts
receivable and prepaid expenses. Cash used by investing activities, net of the
purchases of short-term investments, was approximately $6.0 million for the six
months ended June 30, 2000, consisting primarily of purchased computer equipment
and furniture and fixtures related to increased personnel as well as the
acquisition of OpenSoft Communications Ltd.
While increasing in absolute dollars, for the three and six month periods
ended June 30, 2000, operating expenses decreased as a percentage of total
revenue to 77.6% from 77.9%, respectively, from 86.8% and 86.7% for the same
periods in 1999. Since inception, we have continued to increase our operating
expenses in terms of absolute dollars. We anticipate that we will continue to
reinvest revenues in operating expenses for the foreseeable future, and that
these expenses plus capital expenditures will constitute a material use of cash
resources. Additionally, we may utilize
11
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cash resources to fund acquisitions or investments in businesses, technologies,
or product lines that are complementary to our business. We believe our current
cash and cash equivalents, short-term investments, and funds expected to be
generated from operations will satisfy our anticipated working capital and other
cash requirements for at least the next 12 months.
RECENT ACCOUNTING PRONOUNCEMENTS
In March 2000, the Financial Accounting Standards Board, or FASB, issued
Interpretation No. 44, Accounting for Certain Transactions involving Stock
Compensation - an interpretation of APB Opinion No. 25, (FIN 44). FIN 44 applies
prospectively to new awards, exchanges of awards in a business combination,
modifications to outstanding awards, and changes in grantee status that occur on
or after July 1, 2000, except for the provisions related to repricings and the
definition of an employee, which apply to awards issued after December 15, 1998.
The provisions related to modifications to fixed stock options awards to add a
reload feature are effective for awards modified after January 12, 2000. We do
not expect that this statement will have a significant impact on our financial
condition or results of operations.
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101 ("SAB 101"). SAB 101 summarizes certain areas of the
Staff's views in applying generally accepted accounting principles to revenue
recognition in financial statements. In June 2000, SAB 101B was issued which
defers the implementation date of SAB 101 until October 1, 2000. We do not
expect that this statement will have a significant impact on our financial
condition or results of operations.
In March 2000, the Emerging Issues Task Force of the FASB reached consensus
on Issue 00-2 "Accounting for Website development Costs" ("EITF 00-2"). EITF
00-2 establishes how an entity should account for costs incurred to develop a
website. It requires that an entity capitalize costs during the web application
and infrastructure and graphics development stages of development. The consensus
is effective for all costs incurred beginning after June 30, 2000. We do not
expect that this statement will have a significant impact on our financial
condition or results of operations.
12
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PART II -- OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(d) USE OF PROCEEDS
On February 18, 1999 WebTrends' registration statement on form S-1, file
number 333-69171, became effective. Proceeds to WebTrends were $35,156,421. The
proceeds are being applied in part to working capital with the remainder in
temporary investments consisting of money market accounts available on a daily
basis and short-term commercial paper.
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
On May 11, 2000, at the Company's Annual Meeting of Shareholders, the
holders of the Company's outstanding Common Stock took the actions described
below. As of the record date for the Annual Meeting, 26,006,495 shares of Common
Stock were issued and outstanding.
1. The shareholders elected each of Elijahu Shapira, W. Glen Boyd,
Michael Burmeister-Brown, John W. Ryan, and Srivats Sampath to serve on the
Company's Board of Directors for the ensuing year, all by the votes indicated
below:
<TABLE>
<S> <C> <C>
Elijahu Shapira
------------------------------------ 22,198,139 shares in favor
1,658,240 shares against or withheld
W. Glen Boyd
------------------------------------ 23,670,371 shares in favor
186,008 shares against or withheld
Michael Burmeister-Brown
------------------------------------ 23,675,667 shares in favor
180,712 shares against or withheld
John W. Ryan
------------------------------------ 23,400,529 shares in favor
455,850 shares against or withheld
Srivats Sampath
------------------------------------ 23,675,677 shares in favor
180,702 shares against or withheld
</TABLE>
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2. The shareholders voted to amend the Company's Third Restated
Articles of Incorporation to increase the total number of shares of Common Stock
that the Company is authorized to issue from 60,000,000 to 300,000,000, by the
vote indicated below:
19,325,760 shares in favor
4,117,189 shares against or withheld
413,430 shares not voted
3. The shareholders voted to amend the Company's 1998 Stock Incentive
Plan to: (i) increase the total number of shares reserved for issuance under the
Plan by 1,298,000; (ii) limit the number of shares that can be subject to awards
granted to one person in any one-year period; and (iii) make certain
administrative changes to the Plan, by the vote indicated below:
16,258,081 shares in favor
4,734,694 shares against or withheld
415,716 shares not voted
2,447,888 broker non-votes
4. The shareholders voted to ratify the appointment of KPMG LLP as
independent auditors for the fiscal year ending December 31, 2000, by the vote
indicated below:
23,840,489 shares in favor
7,294 shares against or withheld
8,596 shares not voted
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
See Exhibit Index.
(b) REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the quarter covered by this Form
10-Q.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WEBTRENDS CORPORATION
(Registrant)
Date: August 10, 2000 By /s/ James T. Richardson
------------------------------------------------
James T. Richardson
Senior Vice President and Chief Financial Officer
(principal financial and chief accounting officer)
15
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
<S> <C>
3.1 The Company's Third Restated Articles of Incorporation, as amended
on May 26, 2000.
10.1 Lease for certain office space entered into by the Company and Fox
Tower, LLC on June 22, 2000
10.2 Amended and Restated 1998 Stock Incentive Compensation Plan
27.1 Financial Data Schedule
</TABLE>
