UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the Fiscal Year Ended January 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
Commission File Number 0-9747
EXCALIBUR TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 85-0278207
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1921 Gallows Road, Suite 200, Vienna, Virginia 22182
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (703) 761-3700
Securities registered pursuant to Section 12(b) of the Act
None
Securities registered pursuant to Section 12(g) of the Act
Common Stock
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve (12) months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No ____
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]
The aggregate market value of the voting stock held by non-affiliates of the
registrant was approximately $228,840,167 as of April 19, 1996.
The number of shares of Common Stock, $.01 par value, outstanding as of April
19, 1996 was 12,333,417.
<PAGE>
ITEM 10. Directors and Executive Officers of the Registrant.
The Board of Directors held 7 meetings during the fiscal year ended
January 31, 1996; the Committees of the Board of Directors held 20 meetings. The
average attendance in the aggregate of the total number of meetings of the Board
and the total number of Committee meetings was 96%. Each director attended more
than 75% of the meetings of the Board of Directors.
The Board of Directors has established a number of Committees, including
the Audit Committee, the Compensation Committee and the Stock Option Plan
Administration Committee. The Audit Committee, comprising three directors (Mr.
Diamond, Chairman, Dr. King and Mr. O'Reilly) meets with the Company's
management, including its Chief Financial Officer and its independent
accountants several times a year to discuss internal controls and accounting
matters, the Company's financial statements, and the scope and results of the
auditing programs of the independent accountants. The Audit Committee met six
times during fiscal 1996. The Compensation Committee, comprising three directors
(Mr. Diamond, Chairman, Dr. King and Mr. O'Reilly) administers management
compensation and makes recommendations in that regard to the Board. The
Compensation Committee met two times during fiscal 1996. The Stock Option Plan
Administration Committee comprising two directors (Mr. Diamond and Mr. O'Reilly)
administers the Company's Stock Option Plan. The Stock Option Plan
Administration Committee met 12 times during fiscal 1996.
Each non-employee director, who is not an officer of the Company, is paid
$5,000 for each meeting of the Board or its Committees they attend, in person or
by telephone, up to a maximum of $20,000 per fiscal year. Mr. Crooks and Mr.
Diamond are not paid the foregoing fees. All directors are reimbursed for their
expenses in attending meetings of the Board or of its Committees. Each
non-employee director receives options to purchase 25,000 shares of common stock
of Excalibur upon joining the Board and additional options to purchase 25,000
shares of common stock of Excalibur after each subsequent five year period of
service as a member of the Board. The Chairman is granted additional options to
purchase 25,000 shares of common stock of Excalibur upon being elected Chairman
and after each subsequent five year period of service.
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<PAGE>
Item 11. Executive Compensation.
Summary Compensation Table
The following table is the compensation paid by the Company for each of
the three years in the period ended January 31, 1996 to the Chief Executive
Officer and each of the other four most highly compensated current executive
officers of the Company whose compensation exceeded $100,000:
<TABLE>
<CAPTION>
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Other Securities All
Annual Restricted Under- Other
Compen- Stock lying LTIP Compen-
Name and Principal Fiscal sation Award Option/ Payouts sation
Position Year Salary($) Bonus($) ($) ($) SARs(#) ($) ($)
- ------------------ ---- --------- -------- ----- ----- ------- ------ -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Patrick C. Condo 1996 146,833 46,128 -- -- 200,000 -- 131,862 (1)
Chief Executive 1995 94,633 73,856 -- -- 75,000 -- --
Officer and 1994 73,333 30,668 -- -- 15,000 -- --
President
Edwin R. Addison (2) 1996 87,500 78,250 -- -- 40,000 -- --
Executive Vice
President
James H. Buchanan (3) 1996 51,705 -- -- -- 100,000 -- 50,000 (9)
Vice President, Chief
Financial Officer,
Secretary and
Treasurer
James W. Dowe III 1996 125,000 -- -- -- -- -- --
Chief Scientist 1995 125,000 -- -- -- -- -- --
1994 125,000 -- -- -- -- -- --
J. M. Kennedy (4) 1996 200,000 33,000 -- -- -- -- 4,923 (6)
1995 225,000 20,000 -- -- -- -- 124,178 (7)
1994 250,000 145,000 -- -- -- -- 86,547 (8)
David Lambert (5) 1996 64,787 63,000 -- -- 50,000 -- 10,000 (9)
1995 125,000 41,875 -- -- -- -- 24,000 (9)
1994 125,000 43,240 -- -- 95,000 -- 16,000 (9)
Mr. Crooks, the Chairman of the Company, does not receive a salary or any
cash compensation.
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<PAGE>
<FN>
(1) Reimbursed relocation payments of $78,194 and reimbursed taxes $53,668.
(2) Mr. Addison joined the Company on July 20, 1995 when the Company acquired
ConQuest Software, Inc.
(3) Mr. Buchanan joined the Company on September 13, 1995.
(4) Mr. Kennedy resigned as Chief Executive Officer in November, 1995 as a
consequence of a stroke which he suffered in August, 1995.
(5) Mr. Lambert resigned as Chief Financial Officer, Secretary and Treasurer
as of June 16, 1995.
(6) Reimbursed relocation expense of $2,569 and reimbursed taxes of $2,354.
(7) Reimbursed commuting expenses of $13,282, relocation expenses of $54,528
and reimbursed taxes of $56,368.
(8) Reimbursed commuting expenses of $42,754 and reimbursed taxes of $43,793.
(9) Reimbursed relocation expenses.
</FN>
</TABLE>
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Potential Realizable
Individual Grants Value at Assumed
----------------- Annual Rates of
% of Total Stock Price
Options Appreciation for
Granted to Exercise Option Term
Options Employees in or Base Expiration -----------
Name Granted (#) Fiscal Year Price Date 5% ($) 10% ($)
- ---- ----------- ----------- -------------- --------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Patrick C.
Condo 200,000 (1) 21.9% 100,000 - $12.41 6/2/2005 $780,460 $1,977,830
100,000 - $15.97 11/1/2005 $1,004,340 $2,545,210
Edwin R.
Addison 40,000 (1) 4.4% $15.23 7/20/2005 $383,122 $970,908
James H.
Buchanan 100,000 (1) 11.0% 30,000 - $16.85 9/13/2005 $317,907 $805,638
70,000 - $15.97 11/1/2005 $703,038 $1,781,647
James W.
Dowe III 0 -- -- -- -- --
J. M.
Kennedy (2) 0 -- -- -- -- --
David
Lambert (3) 50,000 (1) 5.5% $7.44 2/02/2005 $233,950 $592,872
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<PAGE>
<FN>
(1) These options vest in equal 12-1/2% increments every six months.
(2) Mr. Kennedy resigned as an employee of the Company in November, 1995, as a
consequence of the stroke he suffered in August, 1995.
(3) Mr. Lambert resigned as an employee of the Company as of June 16, 1995.
</FN>
</TABLE>
Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End Values
The following table sets forth, for each of the executive officer names in
the Summary Compensation Table above, each exercise of stock options during the
fiscal year ended January 31, 1996, and the year-end value of unexercised
options:
<TABLE>
<CAPTION>
Number of Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARS at Options/SARS at
Shares Fiscal Year-End(#) Fiscal Year-End($)
Acquired on Exercisable/ Exercisable/
Name Exercise(#) Value Realized Unexercisable Unexercisable (1)
- ---------------- ----------- -------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Patrick C. Condo 0 0 300,000 $840,700/$3,947,200
33,750/266,250
Edwin R. Addison 0 0 192,526 $4,128,062/$446,950
157,526/35,000
James H. Buchanan 0 0 100,000 0/$1,176,600
0/100,000
James W. Dowe III 20,000 $443,025 175,000 $2,895,750/0
175,000/0
J. M. Kennedy(2) 160,000 $4,331,936 175,000 $1,921,500/0
175,000/0
David Lambert (3) 36,250 $127,113 0/0 0/0
<FN>
(1) The closing price of the Company's common stock on January 31, 1996, the
last trading day of the Company's fiscal year, was $28.00 per share.
(2) Mr. Kennedy's employment was terminated in November 1995 as a result of a
stroke which he suffered in August, 1995.
(3) Mr. Lambert resigned as an employee of the Company as of June 16, 1995.
</FN>
</TABLE>
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<PAGE>
Report of the Compensation Committee
The following is the Report of the Compensation Committee of the Board of
Directors, describing the compensation policies and rationale applicable to the
Company's executive officers with respect to the compensation paid to such
executive officers for the fiscal year ended January 31, 1996 (the information
contained in the report shall not be deemed to be "soliciting material" or to be
"filed" with the Securities and Exchange Commission (SEC) nor shall such
information be incorporated by reference into any future filing under the
Securities Act of 1933, as amended (the Securities Act), or the Securities
Exchange Act of 1934, as amended (the Exchange Act), except to the extent that
the Company specifically incorporates it by reference into such filing):
As members of Compensation Committee, it is our duty to set compensation
policies applicable to the Company's executive officers and to evaluate the
performance of the Company's executive officers.
The compensation policy of the Company is that a substantial portion of the
annual compensation of each executive officer should relate to and be contingent
upon the performance of the Company, as well as the individual contribution of
each executive officer. Under the Company's bonus scheme, bonuses are paid based
upon the Company attaining certain sales, expense and profitability goals and on
each officer's individual contribution to the Company's attainment of such
goals.
Mr. Kennedy's base salary for fiscal 1996 was $200,000, which was
determined by negotiation between Mr. Kennedy and the Company. For the fiscal
year ended January 31, 1996, Mr. Kennedy was paid $33,000 for the achievement of
certain goals during the fiscal year ended January 31, 1996. Mr. Kennedy
suffered a stroke in August, 1995 and Pat Condo was then elected to serve as
Chief Executive Officer. Mr. Kennedy resigned as an employee in November, 1995.
His employment agreement provided that he be paid at the rate of $200,000 per
annum until January 31, 1997.
Mr. Condo's base salary for fiscal 1996 was $150,000 per annum, which was
increased to $200,000 as of February 1, 1996. Mr. Condo's salary was determined
by negotiation between Mr. Condo and the Company. Mr. Condo was paid $46,128 for
the achievement of certain goals during the fiscal year January 31, 1996. Forty
percent of Mr. Condo's potential bonus was based on the achievement of quarterly
revenue goals; forty percent of his potential bonus was based on the achievement
of profitability goals and twenty percent was awarded at the discretion of the
Compensation Committee of the Board of Directors.
During fiscal 1996, the Committee also considered stock option grants to
each of the executive officers of the Company. If the officer received stock
options, it was based on his responsibilities and relative position in the
Company. These grants were approved by the Stock Option Plan Administration
Committee which includes Mr. Diamond and Mr. O'Reilly and which administers the
Company's Incentive Plan.
No member of the Compensation Committee is a former or current officer or
employee of the Company or any of its subsidiaries.
Compensation Committee: Jay H. Diamond
Philip J. O'Reilly
W. Frank King III
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<PAGE>
Compensation Committee Interlocks and Insider Participation
Jay H. Diamond, a Director of the Company is a member of the law firm of
Tenzer Greenblatt LLP, New York, New York, which is performing legal services in
the current fiscal year. During the fiscal year ended January 31, 1996 Mr.
Diamond was a member of the law firm of Holtzmann, Wise & Shepard, New York, New
York. The fees paid to Holtzmann, Wise & Shepard did not exceed 5% of such
firm's gross revenues for its last full fiscal year.
Performance Graph
The following graph is a comparison of the cumulative total return to
shareholders of the Company's Common Stock at January 31, 1996 since February 1,
1991 to the cumulative total return over such period of (i) the NASDAQ Stock
Market-U.S., and (ii) the Standard & Poor's High Tech Composite, assuming an
investment in each of $100 on February 1, 1991 and the reinvestment of
dividends. The information contained in the Performance Graph shall not be
deemed to be "soliciting material" or to be "filed" with the SEC, nor shall such
information be incorporated by reference into any future filing under the
Securities Act or the Exchange Act, except to the extent that the Company
specifically incorporates it by reference into such filing.
(Cumulative Total Return graph appears here, plot points are as follows)
<TABLE>
<CAPTION>
Fiscal Year Ended January 31,
-----------------------------
1991 1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C> <C>
Excalibur Technologies
Corporation 100 124 91 84 55 204
NASDAQ Market Index 100 153 173 199 190 268
Standard & Poor's High
Technology Composite 100 107 112 137 153 227
</TABLE>
Employment Agreements
On January 11, 1992, the Company entered into an Employment Agreement with
J. M. Kennedy, which was subsequently amended in February 1993, September 1993,
and February 1995 (as amended, the Employment Agreement). The Employment
Agreement provides that Mr. Kennedy will serve as Chief Executive Officer of the
Company until February 1, 1997. Under the Employment Agreement, Mr. Kennedy's
annual salary is $200,000, and he is eligible to receive additional incentive
compensation for achieving performance goals set by the Compensation Committee
of the Board of Directors. Pursuant to the Employment Agreement, Mr. Kennedy
received stock option grants to purchase 175,000 shares of Common Stock at
$17.02 per share and to purchase 60,000 shares at $1.00 per share. Mr. Kennedy
suffered a stroke in August, 1995, and as a consequence his employment was
terminated in November, 1995. Pursuant to the terms of his Employment Agreement,
he has been paid through January 31, 1997.
-7-
<PAGE>
On July 20, 1995, the Company entered into an Employment Agreement with
Edwin Addison which provides that Mr. Addison will serve as Executive Vice
President of the Company until July 20, 1997 at an annual salary of $150,000.
Mr. Addison is eligible to receive additional incentive compensation upon the
achievement of certain goals by the Company. Pursuant to his employment
agreement Mr. Addison received options to purchase 40,000 shares of Common Stock
at an exercise price of $15.23 per share.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth, as of May 10, 1996, information concerning the
ownership of Common Stock of the Company of all persons known to the Company to
beneficially own 5% or more of the Company's Common Stock, each director of the
Company and all directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
Percent
Amount and Nature of Class
Name and Address of Beneficial Beneficially
of Beneficial Owner Ownership (1) Owned
- ------------------- ------------- -----
<S> <C> <C>
Allen & Company Incorporated 3,187,846(2)(3) 25.2%
711 Fifth Avenue
New York, NY 10022
Richard M. Crooks, Jr 367,850(4) 3.0%
Patrick C. Condo 83,750(5) *
Edwin R. Addison 509,127(6) 4.0%
J. M. Kennedy 175,200(7) 1.4%
James W. Dowe III 175,492(8) 1.4%
Philip J. O'Reilly 30,000(9) *
Jay H. Diamond 25,000(10) *
W. Frank King III 13,000(11) *
All directors and
executive officers 1,386,919(12) 10.6%
as a group (9 persons)
-8-
<PAGE>
<FN>
* Represents less than one percent of the outstanding common stock.
(1) To the Company's knowledge, each person listed has sole voting and
investment power as to the shares indicated, except as described below.
(2) Does not include 1,484,132 shares owned by persons, including Mr. Crooks
and entities which, together with Allen & Company Incorporated, may be
considered a "group," as such term is defined by Section 13(d) of the
Securities Exchange Act of 1934, because many of these persons or entities
are Allen stockholders, officers, directors or relatives of the foregoing
(as reported on Schedule 13D filed with the Commission on April 8, 1994).
No person or entity included in this possible "group," with the exception
of Allen & Company Incorporated, owns 5% or more of the outstanding common
stock.
(3) Includes 271,800 shares of common stock issuable upon conversion of 27,180
shares of the Company's cumulative convertible preferred stock.
(4) Includes (a) 50,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $16.10 per share expiring June 28, 2000 and (b) 50,000 shares of common
stock issuable upon exercise of stock options of the Company at a price of
$20.56 per share expiring November 27, 2005. Does not include shares owned
by Allen & Company Incorporated, of which Mr. Crooks is a director.
(5) Includes (a) 8,750 shares of common stock owned beneficially but not of
record upon exercise of stock options at a price of $12.40 per share
expiring November 13, 2002; (b) 9,375 shares of common stock owned
beneficially but not of record upon exercise of stock options at a price of
$11.64 per share, expiring January 4, 2004; (c) 28,125 shares of common
stock owned beneficially but not of record upon exercise of stock options
at a price of $6.34 per share, expiring December 6, 2004; (d) 25,000 shares
of common stock owned beneficially but not of record, issuable upon
exercise of stock options at a price of $12.41 per share, expiring June 2,
2005; and (e) 12,500 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options at a price of $15.97 per
share expiring November 1, 2005.
(6) Includes (a) 127,767 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options at a price of $1.04 per
share, expiring April 30, 1997; (b) 13,732 shares of common stock owned
beneficially but not of record, issuable upon exercise of stock options at
a price of $2.07 per share expiring June 30, 1997; (c) 11,027 shares of
common stock owned beneficially but not of record, issuable upon exercise
of stock options at a price of $4.14 per share expiring December 31, 1998;
and (d) 5,000 shares of common stock owned beneficially but not of record,
issuable upon exercise of stock options at a price of $15.23 per share
expiring July 20, 2005.
(7) Includes 175,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $17.02 per share, expiring January 11, 2002.
-9-
<PAGE>
(8) Includes (a) 100,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $8.125 per share, expiring May 17, 1999; (b) 50,000 shares of common
stock owned beneficially but not of record, issuable upon exercise of stock
options of the Company at a price of $15.95 per share, expiring July 1,
2000; (c) 25,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $15.75 per share, expiring May 8, 2001.
(9) Includes 25,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $13.00 per share expiring March 12, 2003.
(10) Includes 25,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $11.50 per share expiring February 28, 2004.
(11) Includes 13,000 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company at a price
of $12.50 per share, expiring July 2, 2002.
(12) Includes 766,776 shares of common stock owned beneficially but not of
record, issuable upon exercise of stock options of the Company.
</FN>
</TABLE>
Item 13. Certain Relationships and Related Transactions.
Richard M. Crooks, Jr., the Chairman of the Board of Directors of the
Company, is a director of and consultant to Allen & Company Incorporated.
In March, 1996 the Company completed a private placement of 350,000
shares of its common stock at a price of $25.00 per share. Allen & Company
Incorporated served as placement agent and was paid a fee of $350,000.
The Company's policy is that it will not make loans to, or enter into
other transactions with directors, officers or affiliates unless such loans or
transactions are approved by a majority of the Company's independent
disinterested directors, may reasonably be expected to benefit the Company, and
will be on terms no less favorable to the Company than could be obtained from
unaffiliated third parties. The Company believes that the transactions set forth
herein were made on terms no less favorable to the Company than could have been
obtained from unaffiliated third parties.
The Company has adopted provisions in its Certificate of Incorporation
that limit the liability of its directors for monetary damages arising from a
breach of their fiduciary duty as directors, except to the extent otherwise
required by the Delaware General Corporation Law. Such limitation of liability
does not affect the availability of equitable remedies such as injunctive relief
or rescission.
See also "Compensation Committee Interlocks and Insider Participation"
above.
-10-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: June 13, 1996
EXCALIBUR TECHNOLOGIES CORPORATION
(Registrant)
By: /s/James H. Buchanan
------------------------
James H. Buchanan
Secretary
-11-
