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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 27, 2000
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BACKWEB TECHNOLOGIES LTD.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NOT APPLICABLE
(EXACT NAME OF REGISTRANT'S NAME INTO ENGLISH)
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ISRAEL 7372 NOT APPLICABLE
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
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3 ABBA HILLEL STREET
RAMAT GAN, ISRAEL
(972-3) 611-8800
(ADDRESS AND TELEPHONE NUMBER OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
ELI BARKAT
CHIEF EXECUTIVE OFFICER
BACKWEB TECHNOLOGIES INC.
2077 GATEWAY PLACE, SUITE 500
SAN JOSE, CALIFORNIA 95110
(408) 933-1700
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
COPIES TO:
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JEFFREY D. SAPER, ESQ. AARON M. LAMPERT, ESQ.
SELIM DAY, ESQ. GIL BRANDES, ESQ.
WILSON SONSINI NASCHITZ, BRANDES & CO.
GOODRICH & ROSATI 5 TUVAL STREET
PROFESSIONAL CORPORATION 67897 TEL-AVIV
650 PAGE MILL ROAD ISRAEL
PALO ALTO, CALIFORNIA 94304-1050 (972-3) 623-5000
(650) 493-9300
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement is declared effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [X]
If this Form is to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER SHARE(1) PRICE FILING FEE
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Ordinary shares, nominal value NIS 0.03 per
share..................................... 704,408 shares $20.90 $14,722,127 $3,950
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(1) The price of $20.90 per share, which was the average of the high and low
prices of the Registrant's ordinary shares on the Nasdaq National Market on
July 21, 2000, is set forth solely for the purposes of calculating the
registration fee in accordance with Rule 457(c) of the Securities Act of
1933, as amended.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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The information in this prospectus is not complete and may be changed.
We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and is not
soliciting an offer to buy these securities in any state where the offer
or sale is not permitted.
PROSPECTUS
(SUBJECT TO COMPLETION, DATED JULY 27, 2000)
704,408 SHARES
[BACKWEB LOGO]
BACKWEB TECHNOLOGIES LTD.
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Ordinary Shares
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This prospectus relates to the public offering, which is not being
underwritten, of up to 704,408 shares of our common stock which is held by some
of our current shareholders.
The prices at which such shareholders may sell the shares will be
determined by the prevailing market price for the shares or in negotiated
transactions. We will not receive any of the proceeds from the sale of the
shares.
Our ordinary shares are listed on the Nasdaq National Market under the
symbol "BWEB." On July 21, 2000, the average of the high and low price for our
common stock was $20.90 per share.
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Investing in our ordinary shares involves risks. See "Risk Factors"
beginning on page 1.
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THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE
NOT APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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The date of this prospectus is , 2000.
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No person has been authorized to give any information or to make any
representations other than those contained in this prospectus in connection with
the offering made hereby, and if given or made, such information or
representations must not be relied upon as having been authorized by BackWeb
Technologies Ltd. (referred to in this prospectus as "BackWeb" and "we"), any
selling shareholder or by any other person. Neither the delivery of this
prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that information herein is correct as of any time subsequent to
the date hereof. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any security other than the securities covered
by this prospectus, nor does it constitute an offer to or solicitation of any
person in any jurisdiction in which such offer or solicitation may not lawfully
be made.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public conference rooms. Our SEC filings are also available to the public
from the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below and any future filings made with the SEC under Section
13a, 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until our
offering is completed.
(1) Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2000;
(2) Our Annual Report on Form 10-K for the year ended December 31, 1999;
(3) Our Current Report on Form 8-K, filed with the Commission on July 10,
2000;
(4) Our Current Report on Form 8-K, filed with the Commission on February
11, 2000; and
(5) The description of our Ordinary Shares contained in our Registration
Statement on Form 8-A, filed on June 2, 1999, including any amendments or
reports filed for the purpose of updating such description.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Terry K. Woo, Esq.
General Counsel
BackWeb Technologies Inc.
2077 Gateway Place, Suite 500
San Jose, California 95110
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus or the prospectus supplement is
accurate as of any date other than the date on the front of the document.
BACKWEB TECHNOLOGIES LTD.
We are a leading provider of Internet communication infrastructure software
and application-specific software that enable companies to communicate
business-critical, time-sensitive information throughout their extended
enterprise of customers, partners and employees.
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RISK FACTORS
This offering involves a high degree of risk. You should carefully consider
the risks described below and the other information in this prospectus before
deciding to invest in the ordinary shares.
OUR BUSINESS IS DIFFICULT TO EVALUATE BECAUSE OUR OPERATING HISTORY IS LIMITED
AND WE RECENTLY CHANGED OUR STRATEGIC FOCUS
We have a limited operating history and an even more limited history
operating the business as currently conducted. We cannot be certain that our
business strategy will be successful. We were incorporated on August 31, 1995
and did not begin generating revenues until December 1996. In early 1998, we
changed our strategic focus from a consumer-oriented to an enterprise-oriented
Internet communication company. This change required us to adjust our business
processes and make a number of significant personnel changes.
WE HAVE A HISTORY OF LOSSES AND WE EXPECT FUTURE LOSSES
We have not achieved profitability and expect to continue to incur net
losses for at least the foreseeable future. We incurred net losses of
approximately $15.0 million for the year ended December 31, 1997, $14.6 million
for the year ended December 31, 1998 and $11.5 million for the year ended
December 31, 1999. As of December 31, 1999, we had an accumulated deficit of
approximately $49.0 million.
We expect to continue to incur significant sales and marketing, product
development and administrative expenses and expect such expenses to increase in
2000. As a result, we will need to generate significant revenues to achieve and
maintain profitability.
OUR QUARTERLY OPERATING RESULTS ARE SUBJECT TO FLUCTUATIONS AND SEASONALITY AND
IF WE FAIL TO MEET THE EXPECTATIONS OF SECURITIES ANALYSTS OR INVESTORS, OUR
SHARE PRICE MAY DECREASE SIGNIFICANTLY
Our operating results are difficult to predict. Our future quarterly
operating results may fluctuate significantly and may not meet the expectations
of securities analysts or investors. If this occurs, the price of our ordinary
shares would likely decline. The factors that may cause fluctuations of our
operating results include the following:
- the size, timing and contractual terms of sales of our products and
services due to the long and unpredictable sales cycle of our products;
- delays we may encounter in introducing new versions of BackWeb
Foundation, BackWeb e-Accelerator products and new products and services;
- changes in information systems resource allocation by our customers;
- the mix of products and services sold because our profit margins differ
among products and services; and
- the fixed nature of expenses such as base compensation and rent.
Quarterly revenues and operating results generated by our business
generally depend on license fees from our customers within the quarter. Revenues
from license fees depend upon the volume of end-users. A decrease in end-users
or the cancellation or deferral of any customer contract would reduce our
expected revenues, which could negatively affect our quarterly financial
performance.
Moreover, our sales may be subject to seasonality or cyclicality. We expect
that revenues in the first quarter of each year may be lower than revenues in
the fourth quarter of the preceding year. We believe this trend may occur as a
result of our customers annual budgetary, purchasing and sales cycles.
WE ANTICIPATE INCREASED OPERATING EXPENSES WHICH COULD CAUSE OUR BUSINESS TO
SUFFER IF WE DO NOT CORRESPONDINGLY INCREASE REVENUES
We plan to significantly increase our operating expenses to expand our
sales and marketing operations, broaden our customer support capabilities,
improve operational and
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financial systems, develop new distribution channels and fund greater levels of
research and development. If we do not significantly increase our revenues to
meet these increased expenses, our business will suffer.
OUR BUSINESS WILL SUFFER IF OUR TARGET CUSTOMERS DO NOT ACCEPT INTERNET
SOLUTIONS
Our future revenues and profits, if any, depend upon the widespread
acceptance and use of the Internet as an effective medium of business and
communication by our customers. Rapid growth in the use of and interest in the
Internet has occurred only recently. As a result, acceptance and use may not
continue to develop at historical rates, and a sufficiently broad base of
consumers may not adopt, and continue to use, the Internet and other online
services as a medium of commerce and communication. Our success will depend, in
large part, on the acceptance of the Internet in the commercial marketplace and
on the ability of third parties to provide reliable Internet infrastructure
network with the speed, data capacity, security and hardware necessary for
reliable Internet access and services. To the extent that the Internet continues
to experience increased numbers of users, increased frequency of use or
increased bandwidth requirements of users, the Internet infrastructure may not
be able to support the demands placed on it and the performance or reliability
of the Internet could suffer.
OUR BACKWEB FOUNDATION PLATFORM AND APPLICATIONS ARE NEW AND IT IS UNCLEAR IF
THEY WILL ACHIEVE MARKET ACCEPTANCE
We do not know if our products will be successful. The market for Internet
communications solutions is in its infancy, and we are not certain that our
target customers will widely adopt and deploy our technology throughout their
networks. Even if our products are effective, our target customers may not
choose them for technical, cost, support or other reasons.
Our future growth depends on the commercial success of BackWeb Foundation
and applications developed upon BackWeb Foundation, such as the BackWeb
e-Accelerator products.
OUR SOFTWARE PLATFORM ENABLES THIRD PARTIES TO DEVELOP APPLICATIONS WHICH MAY
COMPETE WITH APPLICATIONS DEVELOPED BY US
Because of BackWeb Foundation's open architecture, third parties have the
ability to develop their own applications on top of our platform. Such third
parties could compete with applications developed by BackWeb. If our target
customers do not widely adopt and purchase our products, or if third parties
were to compete with applications developed by us, our business would suffer.
OUR GROWTH MAY SUFFER BECAUSE OF
THE DIFFICULTIES IN IMPLEMENTING
OUR PRODUCTS
The use of our products by our customers requires implementation services.
Although we currently provide implementation services sufficient to meet our
current business level, our growth will be limited in the event we are unable to
expand our implementation services personnel or subcontract these services to
qualified third parties.
IF WE LOSE A MAJOR CUSTOMER, OUR REVENUES COULD SUFFER BECAUSE OF OUR CUSTOMER
CONCENTRATION
We have generated a substantial portion of our annual and quarterly
historical revenues from a limited number of customers. As a result, if we lose
a major customer, or if there is a decline in end-users in any of our customers'
licenses, our revenues would be adversely affected. In 1997, revenues from two
customers represented 19% and 11%, respectively, of our revenues. In 1998, no
customer accounted for more than 10% of our revenues. In 1999, revenues from one
customer accounted for 13% of our revenues. We expect that a small number of
customers will continue to account for a substantial portion of revenues for the
foreseeable future and revenues from one or more of these customers may
represent more than 10% of our revenues in future years.
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OUR LONG AND UNPREDICTABLE SALES CYCLE DEPENDS ON FACTORS OUTSIDE OUR CONTROL
AND MAY CAUSE LICENSE REVENUES TO VARY SIGNIFICANTLY
To date, our customers have taken a long time to evaluate our products
before making their purchase decisions. The long, and often unpredictable, sales
and implementation cycles for our products may cause license revenues and
operating results to vary significantly from period to period. Along with our
distribution partners, we spend a lot of time educating and providing
information to our prospective customers regarding the use and benefits of our
products. In addition, our customers often begin by purchasing our products on a
pilot basis before they decide whether or not to purchase additional licenses
for full deployment. Even after purchase, our customers tend to deploy BackWeb
Foundation slowly, depending upon:
- the skill set of the customer;
- the size of the deployment;
- the complexity of the customer's network environment; and
- the quantity of hardware and the degree of hardware configuration
necessary to deploy our products.
COMPETITION IN THE INTERNET COMMUNICATIONS MARKET MAY REDUCE THE DEMAND FOR, OR
PRICES OF, OUR PRODUCTS
The Internet communications market is intensely competitive and rapidly
changing. We expect that competition will intensify in the near-term because of
the attention the Internet is currently receiving and because there are very
limited barriers to entry. Our primary long-term competitors may not have
entered the market yet because the Internet communications market is new.
Competition could result in price reductions, fewer customer orders, reduced
gross margin and loss of market share, any of which could cause our business to
suffer. We may not be able to compete successfully, and competitive pressures
may harm our business.
Many of our current and potential competitors have greater name
recognition, longer operating histories, larger customer bases and significantly
greater financial, technical, marketing, public relations, sales, distribution
and other resources than we do. Some of our potential competitors are among the
largest and most well-capitalized software companies in the world.
FAILURE TO EXPAND OUR SALES AND MARKETING ORGANIZATIONS COULD LIMIT OUR GROWTH
If we fail to substantially expand our direct and indirect sales and
marketing operations in our existing markets, our growth will be limited. We
have expanded our direct sales force in North America and Europe and plan to
hire additional sales personnel to meet market demand. Currently, we believe we
will need to significantly expand our sales and marketing organization. We might
not be able to hire or retain the kind and number of sales and marketing
personnel we are targeting because competition for qualified sales and marketing
personnel in the Internet communications market is intense.
FAILURE TO DEVELOP KEY STRATEGIC
RELATIONSHIPS COULD LIMIT OUR GROWTH
We believe that our success in penetrating our target markets depends in
part on our ability to develop and maintain strategic relationships with key
independent software vendors, or ISVs, resellers, systems integrators,
distribution partners and customers. If we fail to develop these strategic
partnerships, our growth could be limited.
WE MAY EXPERIENCE DIFFICULTIES MANAGING OUR EXPECTED GROWTH
Our ability to successfully offer products and services and to implement
our business plan in the rapidly evolving Internet communications market
requires an effective planning and management process. We continue to increase
the scope of our operations domestically and internationally and expect to grow
our headcount substantially depending on market conditions.
These factors have placed, and our anticipated future operations will
continue to place, a significant strain on our management systems and resources.
We expect that we will
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need to continue to improve our financial and managerial controls and reporting
systems and procedures, and expand, train and manage our work force worldwide.
Furthermore, we expect that we will be required to manage multiple relationships
with various customers and other third parties.
THE GLOBAL NATURE OF OUR OPERATIONS
STRAINS OUR MANAGEMENT RESOURCES
If we fail to manage our geographically dispersed organization, we may fail
to meet or exceed our business plan and our revenues may decline. Our research
and development facilities are located in Canada and Israel, and our directors,
executive officers and other key employees are similarly dispersed throughout
the world. In addition, we maintain offices in the United States, Canada, Japan
and Europe to market and sell our products in those countries and surrounding
regions. This geographic dispersion requires significant management resources
that our locally-based competitors do not need to devote to their operations. In
addition, the expansion of our existing international operations and entry into
additional international markets will require significant management attention
and financial resources.
OUR INTELLECTUAL PROPERTY COULD BE USED BY THIRD PARTIES WITHOUT OUR CONSENT
BECAUSE PROTECTION OF OUR INTELLECTUAL PROPERTY IS LIMITED
Our success and ability to compete are substantially dependent upon our
internally developed technology, which we protect through a combination of
patent, copyright, trade secret and trademark law. However, we may not be able
to adequately protect our proprietary rights which may harm our business.
Unauthorized parties may attempt to copy or otherwise obtain and use our
products or technology. Policing unauthorized use of our products is difficult,
and we cannot be certain that the steps we have taken will prevent
misappropriation of our technology, particularly in foreign countries where the
laws may not protect our proprietary rights as fully as in the United States.
OUR PRODUCTS MAY BE USED IN AN
UNINTENDED AND NEGATIVE MANNER
Our products are used to transmit information through the Internet. Our
products could be used to transmit harmful applications, negative messages,
unauthorized reproduction of copyrighted material, inaccurate data, or computer
viruses to end-users in the course of delivery. Any such transmission could
damage our reputation or could give rise to legal claims against us. We could
spend a significant amount of time and money defending against these legal
claims.
OUR PROPRIETARY TECHNOLOGY MAY BE SUBJECT TO INFRINGEMENT CLAIMS
Substantial litigation regarding intellectual property rights exists in the
software industry. A successful claim of product infringement against us and our
failure or inability to license the infringed or similar technology could harm
our business. We expect that software products may be increasingly subject to
third-party infringement claims as the number of competitors in our industry
segments grows and the functionality of products in different industry segments
overlaps. Third parties may make a claim of infringement against us with respect
to our products and technology. Any claims, with or without merit, could:
- be time-consuming to defend;
- result in costly litigation;
- divert management's attention and resources;
- cause product shipment delays; or
- require us to enter into royalty or licensing agreements.
Royalty or licensing agreements, if required, may not be available on
acceptable terms, if at all.
WE DO NOT HAVE SUFFICIENT INSURANCE TO COVER ALL POTENTIAL PRODUCT LIABILITY AND
WARRANTY CLAIMS
Our products are integrated into our customers' networks. The sale and
support of our products may entail the risk of product
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liability or warranty claims based on damage to these networks. In addition, the
failure of our products to perform to customer expectations could give rise to
warranty claims. Although we carry general liability insurance, our insurance
would likely not cover potential claims of this type or may not be adequate to
protect us from all liability that may be imposed.
RAPID TECHNOLOGICAL CHANGES COULD CAUSE OUR PRODUCTS TO BECOME OBSOLETE OR
REQUIRE US TO REDESIGN OUR PRODUCTS
The Internet communications market is characterized by rapid technological
change, frequent new product introductions, changes in customer requirements and
evolving industry standards. If we are unable to develop and introduce products
or enhancements in a timely manner to meet these technological changes, we may
not be able to successfully compete. In addition, our products may become
obsolete in which event we may not be a viable business.
OUR BUSINESS COULD SUFFER IF WE LOSE THE SERVICES OF KEY PERSONNEL
We will need to hire a significant number of additional sales, support,
marketing, and research and development personnel in calendar 2000 and beyond to
increase our revenues. If we fail to attract qualified personnel or retain
current employees, our revenues may not increase and could decline.
Competition for these individuals is intense, and we may not be able to
attract, assimilate or retain additional highly qualified personnel in the
future. Our future success also depends upon the continued service of our
executive officers and other key sales, marketing and support personnel. In
addition, our products and technologies are complex and we are substantially
dependent upon the continued service of our existing engineering personnel, and
especially our founders. None of our officers or key employees is bound by an
employment agreement for any specific term. Our relationships with these
officers and key employees are at will. Moreover, we do not have "key person"
life insurance policies covering any of our employees.
ANY MAJOR DEVELOPMENTS IN THE POLITICAL OR ECONOMIC CONDITIONS IN ISRAEL COULD
CAUSE OUR BUSINESS TO SUFFER BECAUSE WE ARE INCORPORATED IN ISRAEL AND HAVE
IMPORTANT FACILITIES AND RESOURCES LOCATED IN ISRAEL
We are incorporated under the laws of the State of Israel. Our principal
research and development facilities as well as significant executive offices are
located in Israel. Any major hostilities involving Israel or the interruption or
curtailment of trade between Israel and its present trading partners could
significantly harm our business. Since its establishment in 1948, the State of
Israel has been and continues to be in a state of hostility with its neighbors,
varying from time to time in intensity and degree.
Some of our senior officers and key employees are currently obligated to
perform annual reserve duty in the Israel Defense Forces and are subject to
being called for active military duty at any time. Fulfillment of these
obligations may deprive us of key employees for extended periods of time.
Inflation in Israel and devaluation of the NIS against the U.S. dollar,
could have an impact on our financial results. Although Israel has substantially
reduced the rates of inflation and devaluation in recent years, they are still
relatively high compared to those in the United States and we could be harmed by
inflation or devaluation. If inflation rates in Israel increase again and hurt
Israel's economy as a whole, our operations and financial condition could
suffer.
ANY FUTURE PROFITABILITY MAY BE DIMINISHED IF TAX BENEFITS FROM THE STATE OF
ISRAEL ARE REDUCED OR WITHHELD
Pursuant to the Law for the Encouragement of Capital Investments, the
Israeli government has granted "Approved Enterprise" status to our existing
capital investment programs. Consequently, we are eligible for tax benefits for
the first several years in which we generate taxable income. Our future
profitability may be diminished if all or a portion of these tax benefits are
reduced. These tax benefits may be cancelled in the event of changes in Israeli
government policies or if we fail to comply with requisite conditions and
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criteria. Currently the most significant conditions which we must continue to
meet include making specified investments in fixed assets, maintaining the
development and production nature of our facilities, and financing of at least
30% of these investments through the issuance of capital stock.
OUR GROWTH MAY BE LIMITED IF WE DO NOT DEVELOP LOCALIZED VERSIONS OF OUR
PRODUCTS
Historically, most of our sales have been in the United States. In order to
expand internationally, we need to develop localized versions of our products.
If we fail to develop these localized versions, our growth prospects would be
limited. We currently have limited experience in developing localized versions
of our products and marketing and distributing our products internationally.
EXCHANGE RATE FLUCTUATIONS BETWEEN THE
U.S. DOLLAR AND THE NIS MAY NEGATIVELY AFFECT OUR EARNINGS
Although most of our revenues and a majority of our expenses are
denominated in U.S. dollars, a significant portion of our research and
development expenses are incurred in NIS. In addition, we are engaged in certain
loan transactions with affiliates denominated in and dependent on NIS. As a
result, we may be negatively affected by fluctuations in the exchange rate
between the U.S. dollar and the NIS.
THE LOSS OF OUR RIGHT TO USE SOFTWARE
LICENSED TO US BY THIRD PARTIES COULD HARM OUR BUSINESS
We license technology that is incorporated into our products from third
parties, including security and encryption software. Any interruption in the
supply or support of any licensed software could disrupt our operations and
delay our sales, unless and until we can replace the functionality provided by
this licensed software. Because our products incorporate software developed and
maintained by third parties, we depend on these third parties to deliver and
support reliable products, enhance their current products, develop new products
on a timely and cost-effective basis and respond to emerging industry standards
and other technological changes.
WE MAY OFFER TO REPURCHASE SOME OF OUR PREVIOUSLY GRANTED OPTIONS AND ISSUED
SHARES AND MAY BE SUBJECT TO PENALTIES UNDER CALIFORNIA SECURITIES LAWS
We may commence a rescission offer pursuant to the state securities laws of
the State of California because we failed to qualify or receive an exemption
from qualification under California state securities laws when we granted
options to some of our employees in the State of California. The rescission
offer would cover options to purchase ordinary shares issued pursuant to our
1996 U.S. Stock Option Plan and ordinary shares issued upon exercise of these
options which were granted to approximately 42 people in California from 1996 to
1998. The rescission offer would allow these people to return their equity
interests in us in exchange for at least twenty percent of the exercise price
per underlying share for each outstanding option they hold and the price per
share paid by each of these people plus seven percent interest for each share
issued upon exercise of these options. If the rescission offer is consummated,
BackWeb could be required to make an aggregate payment in an amount which we
believe is not material to us and which we currently believe will be no more
than $400,000. As a legal matter, it remains uncertain whether we have any
liability under California state securities laws since publicly traded companies
are exempt from such filings. In addition, we are not aware of any claims for
rescission against us at the time of this prospectus. Upon completing a
rescission offer approved by the California Department of Corporations the
aforementioned optionees should not have any rescission rights under California
law. We may still be subject to penalties or fines related to these issuances.
ISRAELI REGULATIONS MAY LIMIT OUR ABILITY TO ENGAGE IN RESEARCH AND DEVELOPMENT
AND EXPORT OUR PRODUCTS
Under Israeli law we are required to obtain an Israeli government license
to engage in research and development of and
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export of the encryption technology incorporated in our products. Our current
government license to engage in these activities expires May 31, 2001. Our
research and development activities in Israel and our ability to export our
products out of Israel would be limited if:
- the Israeli government revokes our current license;
- our current license is not renewed;
- our license fails to cover the scope of the technology in our products;
or
- Israeli law regarding research and development or export of encryption
technologies were to change.
WE EXPECT TO EXPERIENCE VOLATILITY IN OUR SHARE PRICE WHICH COULD NEGATIVELY
AFFECT YOUR INVESTMENT
Our share price has been volatile and we expect to experience continued
volatility due to a number of factors, including:
- announcements of technological innovations;
- announcements relating to strategic relationships;
- conditions affecting the Internet industry; and
- trends related to the fluctuations of stock prices of Israeli companies.
The market for technology and Internet-related companies has experienced
extreme volatility that often has been unrelated to the operating performance of
particular companies. These fluctuations may adversely affect the trading price
of our ordinary shares, regardless of our actual operating performance.
ISRAELI COURTS MIGHT NOT ENFORCE JUDGMENTS RENDERED OUTSIDE OF ISRAEL WHICH MAY
MAKE IT DIFFICULT TO COLLECT ON JUDGMENTS RENDERED AGAINST US
We are incorporated in Israel. Some of our directors and executive officers
and the Israeli experts named herein are not residents of the United States and
some of their assets and our assets are located outside the United States.
Service of process upon our non-U.S. resident directors and executive officers
or the Israeli experts named herein and enforcement of judgments obtained in the
United States against us, and our directors and executive officers, or the
Israeli experts named herein, may be difficult to obtain within the United
States. BackWeb Technologies Inc., our U.S. subsidiary, is the U.S. agent
authorized to receive service of process in any action against us in any federal
or state court arising out of this offering or any related purchase or sale of
securities. We have not given consent for this agent to accept service of
process in connection with any other claim.
We have been informed by our legal counsel in Israel, Naschitz, Brandes &
Co., that there is doubt as to the enforceability of civil liabilities under
U.S. securities laws in original actions instituted in Israel. However, subject
to certain time limitations, an Israeli court may declare a foreign civil
judgment enforceable if it finds that:
- the judgment was rendered by a court which was, according to the laws of
the state of the court, competent to render the judgment;
- the judgment is no longer appealable;
- the obligation imposed by the judgment is enforceable according to the
rules relating to the enforceability of judgments in Israel and the
substance of the judgment is not contrary to public policy; and
- the judgment is executory in the state in which it was given.
Even if the above conditions are satisfied, an Israeli court will not
enforce a foreign judgment if it was given in a state whose laws do not provide
for the enforcement of judgments of Israeli courts (subject to exceptional
cases) or if its enforcement is likely to prejudice the sovereignty or security
of the State of Israel. An Israeli court also will not declare a foreign
judgment enforceable if:
- the judgment was obtained by fraud;
- there was no due process;
- the judgment was rendered by a court not competent to render it according
to the laws of private international law in Israel;
7
<PAGE> 11
- the judgment is at variance with another judgment that was given in the
same matter between the same parties and which is still valid; or
- at the time the action was brought in the foreign court a suit in the
same matter and between the same parties was pending before a court or
tribunal in Israel.
OUR OFFICERS, DIRECTORS AND AFFILIATED ENTITIES OWN A LARGE PERCENTAGE OF
BACKWEB AND COULD SIGNIFICANTLY INFLUENCE THE OUTCOME OF ACTIONS
Our executive officers, directors and entities affiliated with them, in the
aggregate, beneficially own approximately 22% of our outstanding ordinary shares
as of July 7, 2000. These shareholders, if acting together, would be able to
significantly influence all matters requiring approval by our shareholders,
including the election of directors and the approval of mergers or other
business combination transactions.
WE HAVE ADOPTED ANTI-TAKEOVER PROVISIONS THAT COULD DELAY OR PREVENT AN
ACQUISITION OF BACKWEB, EVEN IF AN ACQUISITION WOULD BE BENEFICIAL TO OUR
SHAREHOLDERS
Provisions of Israeli corporate and tax law and of our articles of
association may have the effect of delaying, preventing or making more difficult
a merger or other acquisition of BackWeb, even if an acquisition would be
beneficial to our shareholders.
Israeli corporate law regulates acquisitions of shares through tender
offers, requires special approvals for transactions involving significant
shareholders and regulates other matters that may be relevant to these types of
transactions. Furthermore, Israel tax considerations may make potential
transactions unappealing to us or to some of our shareholders. In addition, our
charter documents provide for a staggered board of directors.
THE NEW ISRAELI COMPANIES LAW MAY CAUSE UNCERTAINTIES REGARDING CORPORATE
GOVERNANCE
The new Israeli Companies Law, which became effective on February 1, 2000,
has brought about significant changes to Israeli corporate law. Under this new
law, there may be uncertainties regarding corporate governance in some areas.
These uncertainties will persist until this new law has been adequately
interpreted, and these uncertainties could inhibit takeover attempts or other
transactions and inhibit other corporate decisions.
8
<PAGE> 12
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
We have made forward looking statements in this prospectus that are subject
to risks and uncertainties. Forward looking statements include information
concerning possible or assumed future results of operations of BackWeb. Also,
when we use such words as "believes," "expects," "anticipates" or similar
expressions, we are making forward looking statements. You should note that an
investment in our securities involves risks and uncertainties that could affect
future financial results. Our actual results could differ materially from those
anticipated in these forward looking statements as a result of factors,
including those set forth in "Risk Factors" and elsewhere in this prospectus.
USE OF PROCEEDS
BackWeb will not receive any of the proceeds from the sale of the shares
offered by prospectus. All proceeds from the sale of the shares offered by this
prospectus will be for the account of the selling shareholders, as described
below. See "Selling Shareholders" and "Plan of Distribution."
9
<PAGE> 13
SELLING SHAREHOLDERS
The following table sets forth as of the date of this prospectus, the name
of each of the selling shareholders, the number of shares of common stock that
each selling shareholder owns, the number of shares of common stock owned by
each selling shareholder that may be offered for sale from time to time by this
prospectus, and the number of shares of common stock to be held by each selling
shareholder assuming the sale of all the common stock offered hereby.
The selling shareholders are former or current shareholders of BackWeb
Canada Inc., our Canadian subsidiary, and certain shareholders entitled to
registration rights. We may amend or supplement this prospectus from time to
time to update the disclosure set forth herein.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED PRIOR TO OWNED AFTER
OFFERING(1) NUMBER OF OFFERING(1)
-------------------- SHARES BEING -------------------
NAME OF SELLING SHAREHOLDER NUMBER PERCENT OFFERED NUMBER PERCENT
---------------------------------------------------- -------- -------- ------------ ------- --------
<S> <C> <C> <C> <C> <C>
1247582 Ontario Ltd................................. 55,713 * 55,713 0 *
Altamira Management Ltd............................. 280,328 * 280,328 0 *
Amato, Albert....................................... 58,481 * 58,481 0 *
Bennie, Dennis...................................... 61,081 * 61,081 0 *
Bitahon Ltd. ....................................... 70,140 * 70,140 0 *
Morell, Glen........................................ 3,554 * 3,554 0 *
Protege Software (Holdings) Ltd..................... 142,214 * 142,214 0 *
Sampaleanu, Colin................................... 14,217 * 14,217 0 *
Turner, Lee......................................... 8,727 * 8,727 0 *
Vidov, Mark......................................... 2,844 * 2,844 0 *
Wu, Dennis.......................................... 7,109 * 7,109 0 *
Total............................................... 704,408 1.8 704,408 0 *
</TABLE>
---------------
* Less than 1%.
(1) Based on 37,581,938 shares outstanding as of July 24, 2000.
10
<PAGE> 14
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from time to
time by the selling shareholders. The selling shareholders will act
independently of BackWeb in making decisions with respect to the timing, manner
and size of each sale. The selling shareholders may sell the shares being
offered by this prospectus on the Nasdaq National Market, or otherwise, at
prices and under terms then prevailing or at prices related to the then current
market price, at varying prices or at negotiated prices. The shares offered by
this prospectus may be sold, without limitation, by one or more of the following
means of distribution: (a) a block trade in which the broker-dealer so engaged
will attempt to sell such shares as agent, but may position and resell a portion
of the block as principal to facilitate the transaction; (b) purchases by a
broker-dealer as principal and resale by such broker-dealer for its own account
pursuant to this prospectus; (c) an over-the-counter distribution in accordance
with the rules of the Nasdaq National Market; (d) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (e)
in privately negotiated transactions. To the extent required, this prospectus
may be amended and supplemented from time to time to describe a specific plan of
distribution.
In connection with distributions of the shares offered hereby or otherwise,
the selling shareholders may enter into hedging transactions with broker-dealers
or other financial institutions. In connection with such transactions,
broker-dealers or other financial institutions may engage in short sales of
BackWeb's ordinary shares in the course of hedging the positions they assume
with selling shareholders. The selling shareholders may also sell BackWeb's
ordinary shares short and deliver the shares offered hereby to close out such
short positions. The selling shareholders may also enter into option or other
transactions with broker-dealers or other financial institutions which require
the delivery to such broker-dealer or other financial institution of shares
offered hereby, which shares such broker-dealer or other financial institution
may resell pursuant to this prospectus (as supplemented or amended to reflect
such transaction). The selling shareholders may also pledge the shares offered
hereby to a broker-dealer or other financial institution, and, upon a default,
such broker-dealer or other financial institution, may effect sales of the
pledged shares pursuant to this prospectus (as supplemented or amended to
reflect such transaction). In addition, any shares offered hereby that qualify
for sale pursuant to Rule 144 may, at the option of the holder thereof, be sold
under Rule 144 rather than pursuant to this prospectus.
Any broker-dealer participating in such transactions as agent may receive
commissions from the selling shareholder and/or purchasers of the shares offered
by this prospectus (and, if it acts as agent for the purchaser of such shares,
from such purchaser). Usual and customary brokerage fees will be paid by the
selling shareholder. Broker-dealers may agree with the selling shareholder to
sell a specified number of shares at a stipulated price per share, and, to the
extent such a broker-dealer is unable to do so acting as agent for the selling
shareholder, to purchase as principal any unsold shares at the price required to
fulfill the broker-dealer commitment to the selling shareholder. Broker-dealers
who acquire shares as principal may thereafter resell such shares from time to
time in transactions (which may involve cross and block transactions and which
may involve sales to and through other broker-dealers, including transactions of
the nature described above) in the over-the-counter market in negotiated
transactions or otherwise at market prices prevailing at the time of sale or at
negotiated prices, and in connection with such resales, may pay to or receive
from the purchasers of such shares commissions computed as described above.
To comply with the securities laws of certain states, if applicable, the
shares offered hereby will be sold in such jurisdictions only through registered
or licensed brokers or dealers. In addition, in certain states the shares
offered hereby may not be sold unless they have been registered or qualified for
sale in the applicable state or an exemption from
11
<PAGE> 15
the registration or qualification requirement is available and is complied with.
We have advised the selling shareholders that the anti-manipulation rules
of Regulation M under the Exchange Act may apply to sales of the shares offered
hereby in the market and to the activities of the selling shareholders and their
affiliates. In addition, we will make copies of this prospectus available to the
selling shareholders and have informed them of the need for delivery of copies
of this prospectus to purchasers at or prior to the time of any sale of the
shares offered hereby. The selling shareholders may indemnify any broker-dealer
that participates in transactions involving the sale of the shares against
certain liabilities, including liabilities arising under the Securities Act.
At the time a particular offer of shares is made, if required, a prospectus
supplement will be distributed that will set forth the number of shares being
offered and the terms of the offering, including the name of any underwriter,
dealer or agent, the purchase price paid by any underwriter, any discount,
commission and other item constituting compensation, any discount, commission or
concession allowed or reallowed or paid to any dealer, and the proposed selling
price to the public.
12
<PAGE> 16
LEGAL MATTERS
Certain legal matters in connection with this offering with respect to
United States law will be passed upon for BackWeb by Wilson Sonsini Goodrich &
Rosati, Professional Corporation, Palo Alto, California. The validity of the
ordinary shares offered hereby and certain other legal matters in connection
with this offering with respect to Israeli law will be passed upon for BackWeb
by Naschitz, Brandes & Co., Tel-Aviv, Israel. Naschitz, Brandes & Co. is the
owner of 863,997 ordinary shares.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements at December 31, 1999 and 1998, and for each of the years in
the three-year period ended December 31, 1999 as set forth in their report. We
have included our financial statements in the prospectus and elsewhere in the
registration statement in reliance on Ernst & Young LLP's report, given upon the
authority of such firm as experts in accounting and auditing.
13
<PAGE> 17
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this prospectus. You must
not rely on any unauthorized information or representations. This prospectus is
an offer to sell only the shares offered hereby, but only under circumstances
and in jurisdictions where it is lawful to do so. The information contained in
this prospectus is current only as of its date.
[BACKWEB LOGO]
Through and including , 2000 (the 25th day after the date of
this prospectus), all dealers effecting transactions in these securities,
whether or not participating in this offering, may be required to deliver a
prospectus. This is in addition to a dealer's obligation to deliver a prospectus
when acting as an underwriter and with respect to an unsold allotment or
subscription.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE> 18
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses, other than the underwriting
discounts and commissions, payable by the Registrant in connection with the sale
of the securities being registered. All amounts shown are estimates except for
the SEC registration fee and the NASDAQ National Market Fee.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 3,950
Accountant's fees and expenses.............................. 5,000
Legal fees and expenses..................................... 10,000
Miscellaneous............................................... 1,050
-------
Total............................................. $20,000
=======
</TABLE>
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Israeli law permits a company to insure an office holder in respect of
liabilities incurred by him as a result of the breach of his duty of care to the
company or to another person, or as a result of the breach of his fiduciary duty
to the company, to the extent that he acted in good faith and had reasonable
cause to believe that the act would not prejudice the company. A company can
also insure an office holder for monetary liabilities as a result of an act or
omission that he committed in connection with his serving as an office holder.
Furthermore, a company can indemnify an office holder for monetary liability in
connection with his activities as an office holder.
The Articles of Association of BackWeb allow BackWeb to insure and
indemnify office holders to the fullest extent permitted by law. BackWeb has
acquired directors' and officers' liability insurance covering the officers and
directors of BackWeb and its subsidiaries for certain claims.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION OF DOCUMENT PAGE NO.
------- ----------------------- ----------
<S> <C> <C>
5.1 Opinion of Naschitz, Brandes & Co. as to the validity of the
shares......................................................
23.1 Consent of Ernst & Young LLP, Independent Auditors..........
23.2 Consent of Naschitz, Brandes & Co. (contained in Exhibit
5.1)........................................................
24.1 Powers of Attorney (included on page II-3)..................
</TABLE>
ITEM 17. UNDERTAKINGS.
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement 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;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement
II-1
<PAGE> 19
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 this offering.
B. Undertaking Regarding Filings Incorporating Subsequent Exchange Act
Documents by Reference.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration Statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
C. Undertaking in Respect of Indemnification.
Insofar as indemnification for liabilities arising under the Securities
Act 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 SEC such
indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
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 Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
II-2
<PAGE> 20
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 of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto, duly
authorized, in the City of San Jose, California, on July 27, 2000.
BACKWEB TECHNOLOGIES LTD.
By: /s/ ELI BARKAT
------------------------------------
Eli Barkat
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Hanan Miron and Eli Barkat, and each of
them his attorney-in-fact, with the power of substitution, for him in any and
all capacities, to sign any amendment or post-effective amendment to this
Registration Statement on Form S-3 or abbreviated registration statement
(including, without limitation, any additional registration filed pursuant to
Rule 462 under the Securities Act of 1933) with respect hereto and to file the
same, with exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission, hereby ratifying and confirming all that
said attorney-in-fact, or his substitute or substitutes, may do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ ELI BARKAT Chief Executive Officer and Director July 27, 2000
--------------------------------------- (Principal Executive Officer)
Eli Barkat
/s/ HANAN MIRON Chief Financial Officer (Principal Financial July 27, 2000
--------------------------------------- And Accounting Officer)
Hanan Miron
/s/ CHARLES FEDERMAN Director July 27, 2000
---------------------------------------
Charles Federman
/s/ WILLIAM LARSON Director July 27, 2000
---------------------------------------
William Larson
/s/ JOSEPH GLEBERMAN Director July 27, 2000
---------------------------------------
Joseph Gleberman
/s/ GIL SHWED Director July 27, 2000
---------------------------------------
Gil Shwed
AUTHORIZED UNITED STATES REPRESENTATIVE
BACKWEB TECHNOLOGIES, INC.
By: /s/ ELI BARKAT July 27, 2000
----------------------------------
Eli Barkat
President
</TABLE>
II-3
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION OF DOCUMENT PAGE NO.
------- ----------------------- ----------
<S> <C> <C>
5.1 Opinion of Naschitz, Brandes & Co. as to the validity of the
shares......................................................
23.1 Consent of Ernst & Young LLP, Independent Auditors..........
23.2 Consent of Naschitz, Brandes & Co. (contained in Exhibit
5.1)........................................................
24.1 Powers of Attorney (included on page II-3)..................
</TABLE>
