<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
MISSION CRITICAL SOFTWARE, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
605047 10 9
(CUSIP Number)
Ching-Fa Hwang
NetIQ Corporation
5410 Betsy Ross Drive
Santa Clara, CA 95054
(408) 330-7000
Copies to:
Larry W. Sonsini
Thomas C. DeFilipps
Steve L. Camahort
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304
(650) 493-9300
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
February 26, 2000
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Sections 240.13-1(e), 240.13d-(f) or 240.13d-1(g),
check the following box.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Section 240.13d-7(b)
for other parties to whom copies are to be sent.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
<PAGE>
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
NetIQ Corporation I.R.S. Identification No.: 77-0405505
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)
(b)
N/A
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
N/A
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Delaware
- -------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY 3,416,052 (1)
OWNED BY EACH
REPORTING PERSON
WITH
- -------------------------------------------------------------------------------
8 SHARED VOTING POWER
2,385,450 (2)
- -------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
3,416,052 (1)
- -------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
N/A
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,801,502 (1) (2)
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
33.9%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) 3,416,052 shares of MCS Common Stock are subject to a Stock Option
Agreement between NetIQ and MCS. This option is exercisable under certain
circumstances in connection with a termination of the Merger Agreement. Were it
to be exercised, based on the number of shares of MCS Common Stock outstanding
as of February 22, 2000 (as represented by MCS in the Merger Agreement discussed
in Items 3 and 4), the option shares would represent approximately 16.7% of the
outstanding MCS Common Stock subsequent to the exercise of the option.
(2) 2,385,450 shares of Mission Critical Software Inc. ("MCS") Common
Stock are subject to Voting Agreements entered into by NetIQ and certain
stockholders of MCS (discussed in Items 3 and 4 below). NetIQ expressly
disclaims beneficial ownership of any of the shares of MCS Common Stock covered
by the Voting Agreements. Based on the number of shares of MCS Common Stock
outstanding as of February 22, 2000 (as represented by MCS in the Merger
Agreement discussed in Items 3 and 4), the number
SCHEDULE 13D Page 2 of 9
<PAGE>
of shares of MCS Common Stock covered by the Voting Agreements represents
approximately 13.9% of the outstanding MCS Common Stock.
ITEM 1. SECURITY AND ISSUER.
This statement relates to the Common Stock of Mission Critical Software
Inc. ("MCS ") a Delaware corporation ("MCS " or "Issuer"). The principal
executive offices of MCS are located at 13939 Northwest Freeway, Houston, Texas
77040.
ITEM 2. IDENTITY AND BACKGROUND.
The name of the corporation filing this statement is NetIQ Corporation, a
Delaware corporation ("NetIQ"). NetIQ is a provider of eBusiness infrastructure
management software that enables businesses to optimize the performance and
availability of their Windows NT-based systems and applications. NetIQ's
principal business address is 5410 Betsy Ross Drive, Santa Clara, CA 95054.
The address of NetIQ's executive offices is the same as the address of its
principal business.
Set forth on Schedule A is the name of each of the directors and executive
officers of NetIQ along with the present principal occupation or employment of
such directors and executive officers and the name, principal business and
address of any corporation or other organization in which such employment is
conducted, as of the date hereof to NetIQ's knowledge. To NetIQ's knowledge,
each of the individuals identified on Schedule A is a citizen of the United
States.
Neither NetIQ, nor to NetIQ's knowledge any person named on Schedule A
hereto is required to disclose legal proceedings pursuant to Items 2(d) or 2(e).
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to an Agreement and Plan of Reorganization dated as of February
26, 2000 (the "Merger Agreement"), among NetIQ, Planet Acquisition Corp., a
Delaware corporation and wholly-owned subsidiary of NetIQ ("Merger Sub") and
MCS, and subject to the conditions set forth therein (including approval by
stockholders of MCS and NetIQ), Merger Sub will merge with and into MCS and MCS
will become a wholly-owned subsidiary of NetIQ (such events constituting the
"Merger"). Once the Merger is consummated, Merger Sub will cease to exist as a
corporation and all of the business, assets, liabilities and obligations of
Merger Sub will be merged into MCS with MCS remaining as the surviving
corporation (the "Surviving Corporation").
As an inducement for NetIQ to enter into the Merger Agreement and in
consideration thereof, certain stockholders of MCS entered into individual
agreements with NetIQ (collectively the "MCS Voting Agreements") whereby each
such stockholder (collectively, the "MCS Voting Agreement Stockholders") agreed,
severally and not jointly, to vote all of the shares of MCS Common Stock
beneficially owned by him in favor of approval and adoption of the Merger
Agreement and approval of the Merger and certain related matters. NetIQ did not
pay additional consideration to any MCS Voting Agreement Stockholder in
connection with the execution and delivery of the MCS Voting Agreements.
As a condition of NetIQ's willingness to enter into the Merger Agreement,
MCS agreed to grant to NetIQ an option to acquire up to 3,416,052 shares of MCS
Common Stock pursuant to a stock option agreement (the "MCS Stock Option
Agreement"). The MCS Stock Option Agreement becomes exercisable if the Merger
Agreement is terminated under certain circumstances.
SCHEDULE 13D Page 3 of 9
<PAGE>
References to, and descriptions of, the Merger, the Merger Agreement, the
MCS Stock Option Agreement and the NetIQ Stock Option Agreement as set forth in
this Schedule 13D are qualified in their entirety by reference to the copies of
the Merger Agreement, the MCS Stock Option Agreement and the NetIQ Stock Option
Agreement included as Exhibits to the Form 8-K filed by NetIQ on March 6, 2000.
References to, and descriptions of, the MCS Voting Agreements as set forth
in this Schedule 13D are qualified in their entirety by reference to the copy
the form of MCS Voting Agreement included as Exhibit A to this Schedule 13D.
---------
ITEM 4. PURPOSE OF TRANSACTION.
(a) Not applicable.
(b) As described in Item 3 above, this statement relates to the Merger of
Merger Sub, a wholly-owned subsidiary of NetIQ, with and into MCS in a statutory
merger pursuant to the applicable provisions of Delaware Law. At the effective
time of the Merger, the separate existence of Merger Sub will cease and MCS will
continue as the Surviving Corporation and as a wholly-owned subsidiary of NetIQ.
Each holder of outstanding MCS Common Stock will receive, in exchange for each
share of MCS Common Stock held by such holder, 0.9413 shares of NetIQ Common
Stock. NetIQ will assume each outstanding option to purchase MCS Common Stock
under MCS's stock option plans. Furthermore, all rights to purchase shares of
MCS Common Stock under MCS's Employee Stock Purchase Plan shall be converted
into rights to purchase shares of NetIQ Common Stock and shall be assumed by
NetIQ.
Pursuant to the MCS Voting Agreements, the MCS Voting Agreement
Stockholders have agreed to vote their shares of MCS Common Stock (plus any
additional shares of MCS Common Stock and all additional options, warrants and
other rights to acquire shares of MCS Common Stock) beneficially owned by the
Voting Agreement Stockholders (the "MCS Voting Agreement Shares") at every MCS
stockholders meeting and every written consent in lieu of such a meeting to vote
the shares (a) in favor of the Merger and the Merger Agreement (the "MCS
Approval Matters"), (b) in favor of any matter that could reasonably be expected
to facilitate the MCS Approval Matters and (c) in such manner as NetIQ may
direct with respect to all other proposals submitted to the stockholders of
MCS which, directly or indirectly, in any way relates to the MCS Approval
Matters. The MCS Voting Agreements terminate upon the earlier to occur of (i)
such date and time as the Merger shall become effective in accordance with the
terms and provisions of the Merger Agreement, or (ii) such date and time as the
Merger Agreement shall have been terminated pursuant to Article VII thereof.
As a condition of NetIQ's willingness to enter into the Merger Agreement,
MCS agreed to grant to NetIQ an option to acquire up to 3,416,052 shares of MCS
Common Stock pursuant to a stock option agreement (the "MCS Stock Option
Agreement"). The MCS Stock Option Agreement becomes exercisable if the Merger
Agreement is terminated under certain circumstances. The MCS Stock Option
Agreement expires upon the earliest of (i) the effectiveness of the Merger or
(ii) twelve months after a termination of the Merger Agreement pursuant to
certain of its provisions.
As an inducement for MCS to enter into the Merger Agreement and in
consideration thereof, certain stockholders of NetIQ entered into individual
agreements with MCS (collectively the "NetIQ Voting Agreements") whereby each
such stockholder (collectively, the "NetIQ Voting Agreement Stockholders")
agreed, severally and not jointly, to vote all of the shares of NetIQ Common
Stock beneficially owned by him in favor of approval and adoption of the Merger
Agreement and approval of the Merger and certain related matters. MCS did not
pay additional consideration to any NetIQ Voting Agreement Stockholder in
connection with the execution and delivery of the NetIQ Voting Agreements.
SCHEDULE 13D Page 4 of 9
<PAGE>
Pursuant to the NetIQ Voting Agreements, the NetIQ Voting Agreement
Stockholders have agreed to vote their shares of NetIQ Common Stock (plus any
additional shares of NetIQ Common Stock and all additional options, warrants and
other rights to acquire shares of NetIQ Common Stock) beneficially owned by the
NetIQ Voting Agreement Stockholders (the "NetIQ Voting Agreement Shares") at
every NetIQ stockholders meeting and every written consent in lieu of such a
meeting to vote the shares (a) in favor of approval of the Merger, the Merger
Agreement and the issuance of shares of NetIQ Common Stock in exchange for all
outstanding capital stock of MCS as set forth in the Merger Agreement (the
"NetIQ Approval Matters"), (b) in favor of any matter that could reasonably be
expected to facilitate the NetIQ Approval Matters, and (c) in such manner as MCS
may direct with respect to all other proposals submitted to the stockholders of
NetIQ which, directly or indirectly, in any way relates to the NetIQ Approval
Matters. The NetIQ Voting Agreements terminate upon the earlier to occur of (i)
such date and time as the Merger shall become effective in accordance with the
terms and provisions of the Merger Agreement, or (ii) such date and time as the
Merger Agreement shall have been terminated pursuant to Article VII thereof.
In addition, NetIQ agreed to grant to MCS an option to acquire up to
3,520,234 shares of NetIQ Common Stock pursuant to a stock option agreement (the
"NetIQ Stock Option Agreement"). The NetIQ Stock Option Agreement becomes
exercisable if the Merger Agreement is terminated under certain circumstances.
The NetIQ Stock Option Agreement expires upon the earliest of (i) the
effectiveness of the Merger or (ii) twelve months after a termination of the
Merger Agreement pursuant to certain of its provisions.
The purpose of the transactions under the MCS Voting Agreements, the NetIQ
Voting Agreements, the MCS Stock Option Agreement and the NetIQ Stock Option
Agreement are to enable NetIQ and MCS to consummate the transactions
contemplated under the Merger Agreement.
(c) Not applicable.
(d) It is anticipated that upon consummation of the Merger, the directors
of the Surviving Corporation shall be the current directors of Merger Sub. The
initial officers of the Surviving Corporation shall be the following persons,
who shall hold the same offices in NetIQ:
Executive Chairman Michael Bennett
Chief Executive Officer Ching-Fa Hwang
Chief Operating Officer Steve Odom
Chief Financial Officer James Barth
Chief Technical Officer Tom Bernhardt
(e) Other than as a result of the Merger described in Item 3 above, not
applicable.
(f) Not applicable.
(g) Upon consummation of the Merger, the Certificate of Incorporation of
Merger Sub, as in effect immediately prior to the Merger, shall be the
Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided by Delaware Law and such Certificate of Incorporation. Upon
consummation of the Merger, the Bylaws of Merger Sub, as in effect immediately
prior to the Merger, shall be the Bylaws of the Surviving Corporation until
thereafter amended.
(h) - (i) If the Merger is consummated as planned, the MCS Common Stock
will be deregistered under the Act and delisted from The Nasdaq National Market.
SCHEDULE 13D Page 5 of 9
<PAGE>
(j) Other than described above, NetIQ currently has no plan or proposals
which relate to, or may result in, any of the matters listed in Items 4(a) - (j)
of Schedule 13D (although NetIQ reserves the right to develop such plans).
References to, and descriptions of, the Merger, the Merger Agreement, the
MCS Stock Option Agreement and the NetIQ Stock Option Agreement as set forth in
this Schedule 13D are qualified in their entirety by reference to the copies of
the Merger Agreement, the MCS Stock Option Agreement and the NetIQ Stock Option
Agreement included as Exhibits to the Form 8-K filed by NetIQ on March 6, 2000.
References to, and descriptions of, the MCS Voting Agreements as set forth
in this Schedule 13D are qualified in their entirety by reference to the copy
the form of MCS Voting Agreement included as Exhibit A to this Schedule 13D.
---------
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b) As a result of the MCS Voting Agreements, NetIQ may be deemed to
be the beneficial owner of at least 2,385,450 shares of MCS Common Stock. Such
MCS Common Stock constitutes approximately 13.9% of the issued and outstanding
shares of MCS Common Stock based on the number of shares of MCS Common Stock
outstanding as of February 22, 2000 (as represented by MCS in the Merger
Agreement discussed in Items 3 and 4). NetIQ may be deemed to have the shared
power to vote the Shares with respect to those matters described above. However,
NetIQ (i) is not entitled to any rights as a stockholder of MCS as to the Shares
and (ii) disclaims any beneficial ownership of the shares of MCS Common Stock
which are covered by the Voting Agreements.
To NetIQ's knowledge, no person listed on Schedule A has an ownership
interest in MCS.
Set forth on Schedule B are the names of the stockholder of MCS that have
entered into an MCS Voting Agreement with NetIQ, and their present principal
occupation or employment, including the name, principal business and address of
any corporation or other organization in which such employment is conducted, to
NetIQ's knowledge.
To NetIQ's knowledge, no transactions in the class of securities reported
have been effected during the past sixty days by any person named pursuant to
Item 2.
(c) To the knowledge of NetIQ, no transactions in the class of securities
reported have been effected during the past sixty days by any person named
pursuant to Item 2.
(d) To the knowledge of NetIQ, no other person has the right to receive or
the power to direct the receipt of dividends from, or the proceeds from the sale
of, the securities of MCS reported on herein.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Other than the Merger Agreement and the exhibits thereto, including the
voting agreements and the stock option agreements described herein, to the
knowledge of NetIQ, there are no contracts, arrangements, understandings or
relationships among the persons named in Item 2 and between such persons and any
person with respect to any securities of MCS, including but not limited to
transfer or voting of any of the securities,
SCHEDULE 13D Page 6 of 9
<PAGE>
finder's fees, joint ventures, loan or option arrangement, puts or calls,
guarantees of profits, division of profits or loss, or the giving or withholding
of proxies.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
The following documents are filed as exhibits:
A. Form of Voting Agreement, dated February 26, 2000, between NetIQ
Corporation and certain stockholders of Mission Critical Software,
Inc.
B. * Agreement and Plan of Reorganization, dated as of February 26, 2000,
by and among NetIQ Corporation, Planet Acquisition Corp. and Mission
Critical Software, Inc...
C. * Stock Option Agreement, dated February 26, 2000, between NetIQ
Corporation and Mission Critical Software, Inc.
D. * Stock Option Agreement, dated February 26, 2000, between Mission
Critical Software, Inc. and NetIQ Corporation.
* Incorporated by reference to the 8-K filed by NetIQ Corporation on March
6, 2000.
SCHEDULE 13D Page 7 of 9
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: March 7, 2000 NETIQ CORPORATION
By: /s/ James A. Barth
----------------------------
James A. Barth
Chief Financial Officer
SCHEDULE 13D Page 8 of 9
<PAGE>
Schedule A
DIRECTORS AND EXECUTIVE OFFICERS OF
NETIQ CORPORATION
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer of
NetIQ. The address of each such person is c/o NetIQ Corporation, 5410 Betsy
Ross Drive, Santa Clara, CA 95054. To NetIQ's knowledge, each of the
individuals identified below is a citizen of the United States.
<TABLE>
<CAPTION>
Present Principal Occupation and
Name and Title Name of Employer
- ---------------------------------------------------------------------------------------------------------
<S> <C>
Ching-Fa Hwang NetIQ Corporation
President, Chief Executive Officer and Director
James A. Barth NetIQ Corporation
Vice President, Finance, Chief Financial Officer and
Secretary
Her-Daw Che NetIQ Corporation
Vice President, Engineering and Director
Thomas R. Kemp NetIQ Corporation
Vice President, Marketing
Glenn S. Winokur NetIQ Corporation
Vice President, Worldwide Sales
Kuo-Wei ("Herbert") Chang President
Director InveStar Burgeon Venture Capital, Inc.
Louis C. Cole President and Chief Executive Officer
Director Legato Systems, Inc.
Alan W. Kaufman Chairman of the Board
Director QueryObject Systems
Ying-Hon Wong General Partner
Director Wongfratris Investment Company
</TABLE>
SCHEDULE 13D Page 9 of 9
<PAGE>
Schedule B
The following table sets forth the name and present principal occupation or
employment of each MCS stockholder that entered into a voting agreement with
NetIQ. Except as indicated below, the business address of each such person is
c/o NetIQ Corporation, 5410 Betsy Ross Drive, Santa Clara, CA 95054.
<TABLE>
<CAPTION>
Voting Agreement Stockholder Shares Beneficially Owned
<S> <C>
Michael S. Bennett
Chairman and Chief Executive Officer, MCS 251,130
Stephen E. Odom
Chief Financial Officer and Chief Operating Officer, MCS 50,184
Thomas P. Bernhardt
Chief Technical Officer, MCS 780,865
Brian J. McGrath
Vice President, Sales, MCS 153,623
Scott D. Sandell
Director, MCS
Partner, New Enterprise Associates Entities 1,045,455
John D. Thornton
Director, MCS
General Partner, Austin Ventures Entities 19,296
Douglas L. Ayer
Director, MCS
President, International Capital Partners, Inc. 84,897
--------------------
TOTAL 2,385,450
</TABLE>
SCHEDULE 13D Page 10 of 9
<PAGE>
EXHIBIT 99.A
MCS VOTING AGREEMENT
THIS MCS VOTING AGREEMENT (this "Agreement") is made and entered into as of
February 26, 2000, among NetIQ Corp., a Delaware corporation ("NetIQ"), and the
undersigned stockholder (the "Stockholder") of Mission Critical Software Inc., a
Delaware corporation ("MCS").
RECITALS
--------
A. MCS and NetIQ have entered into an Agreement and Plan of
Reorganization (the "Merger Agreement"), which provides for the merger (the
"Merger") of a subsidiary of NetIQ with and into MCS. Pursuant to the Merger,
all outstanding capital stock of MCS shall be converted into the right to
receive NetIQ Common Stock, as set forth in the Merger Agreement;
B. Stockholder is the beneficial owner (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of such
number of shares of the outstanding capital stock of MCS and shares subject to
outstanding options and warrants as is indicated on the signature page of this
Agreement; and
C. In consideration of the execution of the Merger Agreement by NetIQ,
Stockholder (in his or her capacity as such) agrees to vote the Shares (as
defined below) and other such shares of capital stock of MCS over which
Stockholder has voting power so as to facilitate consummation of the Merger.
NOW, THEREFORE, intending to be legally bound, the parties hereto agree as
follows:
1. Certain Definitions. Capitalized terms not defined herein shall have
-------------------
the meanings ascribed to them in the Merger Agreement. For purposes of this
Agreement:
(a) "Expiration Date" shall mean the earlier to occur of (i) such
date and time as the Merger Agreement shall have been terminated pursuant to
Article VII thereof, or (ii) such date and time as the Merger shall become
effective in accordance with the terms and provisions of the Merger Agreement.
(b) "Person" shall mean any (i) individual, (ii) corporation, limited
liability MCS, partnership or other entity, or (iii) governmental authority.
(c) "Shares" shall mean: (i) all securities of MCS (including all
shares of MCS Common Stock and all options, warrants and other rights to acquire
shares of MCS Common Stock) owned by Stockholder as of the date of this
Agreement; and (ii) all additional securities of MCS (including all additional
shares of MCS Common Stock and all additional options, warrants and other rights
to acquire shares of MCS Common Stock) of which Stockholder acquires ownership
during the period from the date of this Agreement through the Expiration Date.
<PAGE>
(d) "Transfer." A Person shall be deemed to have effected a
"Transfer" of a security if such person directly or indirectly: (i) sells,
pledges, encumbers, grants an option with respect to, transfers or disposes of
such security or any interest in such security; or (ii) enters into an agreement
or commitment providing for the sale of, pledge of, encumbrance of, grant of an
option with respect to, transfer of or disposition of such security or any
interest therein.
2. Transfer of Shares.
------------------
(a) Transferee of Shares to be Bound by this Agreement. Stockholder
--------------------------------------------------
agrees that, during the period from the date of this Agreement through the
Expiration Date, Stockholder shall not cause or permit any Transfer of any of
the Shares to be effected unless each Person to which any of such Shares, or any
interest in any of such Shares, is or may be transferred shall have: (a)
executed a counterpart of this Agreement and a proxy in the form attached hereto
as Exhibit A (with such modifications as NetIQ may reasonably request); and (b)
---------
agreed in writing to hold such Shares (or interest in such Shares) subject to
all of the terms and provisions of this Agreement.
(b) Transfer of Voting Rights. Stockholder agrees that, during the
-------------------------
period from the date of this Agreement through the Expiration Date, Stockholder
shall not deposit (or permit the deposit of) any Shares in a voting trust or
grant any proxy or enter into any voting agreement or similar agreement in
contravention of the obligations of Stockholder under this Agreement with
respect to any of the Shares.
3. Agreement to Vote Shares. At every meeting of the stockholders of MCS
------------------------
called, and at every adjournment thereof, and on every action or approval by
written consent of the stockholders of MCS, Stockholder (in his or her capacity
as such) shall cause the Shares to be voted (a) in favor of the Merger and the
Merger Agreement (the "MCS Approval Matters"), (b) in favor of any matter that
could reasonably be expected to facilitate the MCS Approval Matters and (c) in
such manner as NetIQ may direct with respect to all other proposals submitted to
the stockholders of NetIQ which, directly or indirectly, in any way relates to
the MCS Approval Matters.
4. Irrevocable Proxy. Concurrently with the execution of this Agreement,
-----------------
Stockholder agrees to deliver to NetIQ a proxy in the form attached hereto as
Exhibit A (the "Proxy"), which shall be irrevocable to the fullest extent
- ---------
permissible by law, with respect to the Shares.
5. Representations and Warranties of the Stockholder. Stockholder (i) is
-------------------------------------------------
the beneficial owner of the shares of MCS Common Stock indicated on the final
page of this Agreement, free and clear of any liens, claims, options, rights of
first refusal, co-sale rights, charges or other encumbrances; (ii) does not
beneficially own any securities of MCS other than the shares of MCS Common Stock
and options and warrants to purchase shares of Common Stock of MCS indicated on
the final page of this Agreement; and (iii) has full power and authority to
make, enter into and carry out the terms of this Agreement and the Proxy.
6. Additional Documents. Stockholder (in his or her capacity as such)
--------------------
hereby covenants and agrees to execute and deliver any additional documents
necessary or desirable, in the reasonable opinion of NetIQ, to carry out the
intent of this Agreement.
-2-
<PAGE>
7. Termination. This Agreement shall terminate and shall have no further
-----------
force or effect as of the Expiration Date.
8. Miscellaneous.
-------------
(a) Severability. If any term, provision, covenant or restriction of
------------
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, then the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
(b) Binding Effect and Assignment. This Agreement and all of the
-----------------------------
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but, except as
otherwise specifically provided herein, neither this Agreement nor any of the
rights, interests or obligations of the parties hereto may be assigned by either
of the parties without prior written consent of the other.
(c) Amendments and Modification. This Agreement may not be modified,
---------------------------
amended, altered or supplemented except upon the execution and delivery of a
written agreement executed by the parties hereto.
(d) Specific Performance; Injunctive Relief. The parties hereto
---------------------------------------
acknowledge that NetIQ shall be irreparably harmed and that there shall be no
adequate remedy at law for a violation of any of the covenants or agreements of
Stockholder set forth herein. Therefore, it is agreed that, in addition to any
other remedies that may be available to NetIQ upon any such violation, NetIQ
shall have the right to enforce such covenants and agreements by specific
performance, injunctive relief or by any other means available to NetIQ at law
or in equity.
(e) Notices. All notices and other communications pursuant to this
-------
Agreement shall be in writing and deemed to be sufficient if contained in a
written instrument and shall be deemed given if delivered personally,
telecopied, sent by nationally-recognized overnight courier or mailed by
registered or certified mail (return receipt requested), postage prepaid, to the
parties at the following address (or at such other address for a party as shall
be specified by like notice):
If to NetIQ: NetIQ Corp.
5410 Betsy Ross Drive
Santa Clara, California 95054
Facsimile: (408) 330-0959
Attention: Chief Executive Officer
-3-
<PAGE>
With copies to: Wilson Sonsini Goodrich & Rosati,
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304-1050
Attention: Larry W. Sonsini, Esq.
Thomas C. DeFilipps, Esq.
Facsimile: (650) 493-6811
and to: Wilson Sonsini Goodrich & Rosati
Professional Corporation
Spear Street Tower
One Market
San Francisco, California 94105
Attention: Steve L. Camahort, Esq.
Facsimile: (415) 947-2099
If to Stockholder: To the address for notice set forth on the
signature page hereof.
(f) Governing Law. This Agreement shall be governed by the laws of
-------------
the State of Delaware, without reference to rules of conflicts of law.
(g) Entire Agreement. This Agreement and the Proxy contain the
----------------
entire understanding of the parties in respect of the subject matter hereof, and
supersede all prior negotiations and understandings between the parties with
respect to such subject matter.
(h) Officers and Directors. To the extent that Stockholder is or
----------------------
becomes (during the term hereof) a director or officer of MCS, he or she makes
no agreement or understanding herein in his or her capacity as such director or
officer, and nothing herein will limit or affect, or give rise to any liability
to Stockholder by virtue of, any actions taken by Stockholder in his or her
capacity as an officer or director of MCS in exercising its rights under the
Merger Agreement.
(i) Effect of Headings. The section headings are for convenience
------------------
only and shall not affect the construction or interpretation of this Agreement.
(j) Counterparts. This Agreement may be executed in several
------------
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same agreement.
[The remainder of this page has been intentionally left blank]
-4-
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed on the day and year first above written. The undersigned is executing
this Agreement only in its capacity as a stockholder. Such signature in no way
affects its obligations as an officer or director of MCS.
NETIQ CORP. STOCKHOLDER
By:__________________________________ By:__________________________________
Signature
Name:________________________________ Name:________________________________
Title:_______________________________ Title:_______________________________
_____________________________________
_____________________________________
Print Address
_____________________________________
Telephone
_____________________________________
Facsimile No.
Share beneficially owned:
____________ shares of MCS Common Stock
____________ shares of MCS Common Stock
issuable upon exercise of outstanding
options or warrants
[Signature Page to Voting Agreement]
<PAGE>
Exhibit A
IRREVOCABLE PROXY
The undersigned stockholder of Mission Critical Software Inc., a Delaware
corporation ("MCS"), hereby irrevocably (to the fullest extent permitted by law)
appoints Michael Bennett and Stephen E. Odom and each of them, as the sole and
exclusive attorneys and proxies of the undersigned, with full power of
substitution and resubstitution, to vote and exercise all voting and related
rights (to the full extent that the undersigned is entitled to do so) with
respect to all of the shares of capital stock of MCS that now are or hereafter
may be beneficially owned by the undersigned, and any and all other shares or
securities of MCS issued or issuable in respect thereof on or after the date
hereof (collectively, the "Shares") in accordance with the terms of this Proxy.
The Shares beneficially owned by the undersigned stockholder of MCS as of the
date of this Proxy are listed on the final page of this Proxy. Upon the
undersigned's execution of this Proxy, any and all prior proxies given by the
undersigned with respect to any Shares are hereby revoked and the undersigned
agrees not to grant any subsequent proxies with respect to the Shares until
after the Expiration Date (as defined below).
This Proxy is irrevocable (to the fullest extent permitted by law), is
coupled with an interest and is granted pursuant to that certain Voting
Agreement of even date herewith by and among NetIQ Corp., a Delaware corporation
("NetIQ"), and the undersigned stockholder (the "Voting Agreement"), and is
granted in consideration of NetIQ entering into that certain Agreement and Plan
of Merger (the "Merger Agreement"), by and between NetIQ, a subsidiary of NetIQ
("Merger Sub") and MCS. The Merger Agreement provides for the merger of Merger
Sub with and into MCS in accordance with its terms (the "Merger"). As used
herein, the term "Expiration Date" shall mean the earlier to occur of (i) such
date and time as the Merger Agreement shall have been validly terminated
pursuant to Article VII thereof or (ii) such date and time as the Merger shall
become effective in accordance with the terms and provisions of the Merger
Agreement.
The attorneys and proxies named above, and each of them, are hereby
authorized and empowered by the undersigned, at any time prior to the Expiration
Date, to act as the undersigned's attorney and proxy to vote the Shares, and to
exercise all voting, consent and similar rights of the undersigned with respect
to the Shares (including, without limitation, the power to execute and deliver
written consents) at every annual, special or adjourned meeting of stockholders
of MCS and in every written consent in lieu of such meeting (a) in favor of the
Merger and the Merger Agreement (the "MCS Approval Matters"), (b) in favor of
any matter that could reasonably be expected to facilitate the MCS Approval
Matters and (c) in such manner as NetIQ may direct with respect to all other
proposals submitted to the stockholders of NetIQ which, directly or indirectly,
in any way relates to the MCS Approval Matters.
The attorneys and proxies named above may not exercise this Proxy on any
other matter except as provided above. The undersigned stockholder may vote the
Shares on all other matters.
Any obligation of the undersigned hereunder shall be binding upon the
successors and assigns of the undersigned. The undersigned is executing this
Proxy only in its capacity as a stockholder. Such signature in no way affects
its obligations as an officer or director of MCS.
<PAGE>
This Proxy is irrevocable (to the fullest extent permitted by law). This
Proxy shall terminate, and be of no further force and effect, automatically upon
the Expiration Date.
Dated:___________________, 2000
Signature of Stockholder:________________________
Print Name of Stockholder:_______________________
Shares beneficially owned:
________ shares of MCS Common Stock
________ shares of MCS Common Stock issuable
upon exercise of outstanding options
or warrants
[Signature Page to Irrevocable Proxy]
