<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
Filed by the Registrant / /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-12
SENTO CORPORATION
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
----------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
----------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how
it was determined):
----------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
----------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------
(3) Filing Party:
----------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------
</TABLE>
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
JULY 18, 2000
SENTO CORPORATION
You are cordially invited to attend the Annual Meeting of Shareholders of
Sento Corporation (the "Company"), which will be held on Tuesday, July 18, 2000
at 10 a.m., at the Company's corporate offices located at 808 East Utah Valley
Drive, American Fork, Utah 84003 (the "Annual Meeting"), for the following
purposes, which are more fully described in the Proxy Statement accompanying
this Notice:
(i) To elect five directors of the Company, each to serve until the 2001
Annual Meeting of Shareholders or until their respective successors have
been duly elected and qualified;
(ii) To consider and vote upon a proposal to ratify and approve an amendment
to the Sento Corporation 1996 Employee Stock Purchase Plan (Amended and
Restated) (the "Plan") to increase the maximum number of shares of
Common Stock, par value $.25 per share, of the Company available for
issuance under the Plan from 200,000 to 500,000;
(iii) To consider and vote upon a proposal to ratify the appointment of
Ernst & Young LLP as independent auditors of the Company for the fiscal
year ending March 31, 2001; and
(iv) To transact such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on June 16, 2000 as
the record date for the determination of shareholders entitled to receive notice
of and to vote at the Annual Meeting and at any adjournment or postponement
thereof.
All shareholders are cordially invited to attend the Annual Meeting in
person. However, to ensure your representation at the Annual Meeting, you are
urged to vote, sign, date and return the enclosed Proxy as promptly as possible
in the enclosed postage-prepaid envelope. Shareholders attending the Annual
Meeting may vote in person even if they have returned a Proxy.
By Order of the Board of Directors
/s/ Stanley J. Cutler
Stanley J. Cutler
SECRETARY
June 19, 2000
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, TO ASSURE
THAT YOUR SHARES WILL BE REPRESENTED, PLEASE COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY WITHOUT DELAY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO
ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES. YOUR PROXY WILL NOT BE USED
IF YOU ARE PRESENT AT THE ANNUAL MEETING AND DESIRE TO VOTE YOUR SHARES
PERSONALLY.
<PAGE>
SENTO CORPORATION
808 EAST UTAH VALLEY DRIVE
AMERICAN FORK, UTAH 84003
PROXY STATEMENT
---------------------
ANNUAL MEETING OF SHAREHOLDERS
JULY 18, 2000
SOLICITATION OF PROXIES
This Proxy Statement is being furnished to the shareholders of Sento
Corporation, a Utah corporation (the "Company"), in connection with the
solicitation by the Board of Directors of the Company (the "Board of Directors")
of proxies from holders of outstanding shares of the Company's common stock, par
value $.25 per share (the "Common Stock"), for use at the Annual Meeting of
Shareholders of the Company to be held Tuesday, July 18, 2000 and at any
adjournment or postponement thereof (the "Annual Meeting"). This Proxy
Statement, the Notice of Annual Meeting of Shareholders and the accompanying
form of proxy are first being mailed to shareholders of the Company on or about
June 19, 2000.
The Company will bear all costs and expenses relating to the solicitation of
proxies, including the costs of preparing, printing and mailing to shareholders
this Proxy Statement and accompanying materials. In addition to the solicitation
of proxies by mail, the directors, officers and employees of the Company,
without receiving additional compensation therefor, may solicit proxies
personally or by telephone, facsimile transmission, e-mail or web posting.
Arrangements will be made with brokerage firms and other custodians, nominees
and fiduciaries representing beneficial owners of shares of the Common Stock for
the forwarding of solicitation materials to such beneficial owners and the
Company will reimburse such brokerage firms, custodians, nominees and
fiduciaries for reasonable out-of-pocket expenses incurred by them in doing so.
VOTING
RECORD DATE
The Board of Directors has fixed the close of business on June 16, 2000 as
the record date for determination of shareholders entitled to notice of and to
vote at the Annual Meeting (the "Record Date"). As of the Record Date, there
were issued and outstanding 8,339,393 shares of Common Stock. The holders of
record of the shares of Common Stock on the Record Date entitled to be voted at
the Annual Meeting are entitled to cast one vote per share on each matter
submitted to a vote at the Annual Meeting. Accordingly, 8,330,393 votes are
entitled to be cast on each matter submitted to a vote at the Annual Meeting.
PROXIES
Shares of Common Stock which are entitled to be voted at the Annual Meeting
and which are represented by properly executed proxies will be voted in
accordance with the instructions indicated on such proxies. If no instructions
are indicated, such shares will be voted (i) FOR the election of each of the
five director nominees; (ii) FOR the proposal to amend the Sento Corporation
1996 Employee Stock Purchase Plan (Amended and Restated) (the "Plan") to
increase the maximum number of shares of Common Stock available for issuance
under the Plan from 200,000 to 500,000; (iii) FOR the ratification of
1
<PAGE>
the appointment by the Board of Directors of Ernst & Young LLP to be the
independent auditors of the Company for the fiscal year ending March 31, 2001;
and (iv) in the discretion of the proxy holders as to any other matters which
may properly come before the Annual Meeting.
A shareholder who has executed and returned a proxy may revoke it at any
time prior to its exercise at the Annual Meeting by executing and returning a
proxy bearing a later date, by filing with the Secretary of the Company, at the
address set forth above, a written notice of revocation bearing a later date
than the proxy being revoked, or by voting the Common Stock covered thereby in
person at the Annual Meeting.
REQUIRED VOTE
A majority of the outstanding shares of Common Stock entitled to vote,
represented in person or by properly executed proxy, is required for a quorum at
the Annual Meeting. Abstentions and broker non-votes, which are indications by a
broker that it does not have discretionary authority to vote on a particular
matter, will be counted as "represented" for the purpose of determining the
presence or absence of a quorum. Under Utah corporate law and the Articles of
Incorporation and Bylaws of the Company, once a quorum is established,
shareholder approval with respect to a particular proposal is generally obtained
when the votes cast in favor of the proposal exceed the votes cast against such
proposal.
In the election of directors, the five nominees receiving the highest number
of votes will be elected. For approval of the proposal to amend the Sento
Corporation 1996 Employee Stock Purchase Plan (Amended and Restated), the votes
cast in favor of such proposal must exceed the votes cast against the proposal.
Accordingly, abstentions and broker non-votes will not have the effect of being
considered as votes cast against any matter considered at the Annual Meeting.
ELECTION OF DIRECTORS
NOMINEES FOR ELECTION AS DIRECTORS
At the Annual Meeting, five directors of the Company constituting the entire
Board of Directors are to be elected to serve until the next annual meeting of
shareholders and until their successors shall be duly elected and qualified. If
any of the nominees should be unavailable to serve, which is not now
anticipated, the proxies solicited hereby will be voted for such other persons
as shall be designated by the present Board of Directors. The five nominees
receiving the highest number of votes at the Annual Meeting will be elected.
Certain information with respect to each nominee for director is set forth
below.
<TABLE>
<CAPTION>
NAME AGE POSITION DIRECTOR SINCE
---- -------- --------------------------------------------- --------------
<S> <C> <C> <C>
Kieth E. Sorenson................. 51 Chairman of the Board 1997
President, Chief Executive Officer and
Dennis L. Herrick................. 57 Director 2000
Gary B. Filler.................... 59 Acting Chief Financial Officer and Director 1998
Kim A. Cooper..................... 41 Director 1999
Lyndon L. Ricks................... 44 Director 1999
</TABLE>
KIETH E. SORENSON has served as Chairman of the Board of the Company since
December 1, 1997. Mr. Sorenson served as President and Chief Executive Officer
of the Company from December 1, 1997 to April 22, 1999. Prior to joining the
Company, Mr. Sorenson was the founder of Truevision, Inc. (formerly RasterOps),
a publicly traded multi-media, graphics and video company. From 1993 to 1997, he
was a managing partner of Sorenson, Thomas & Co. and President, CEO and Chairman
of Truevision, Inc., of which he continued to serve as a director until
January 1999. From 1979 to 1987, he was employed by Ramtek, Inc., a Silicon
Valley pioneer in computer graphics as Vice President of Engineering and Product
Marketing. He is also currently the owner of Avtronix, a private aviation
electronics manufacturing company, and a director of Sumeria, a developer of
CD-ROM titles.
2
<PAGE>
DENNIS L. HERRICK joined the Company as President and Chief Executive
Officer, and as a member of the Board of Directors in March 2000. Prior to
joining Sento he was President and Chief Executive Officer of I-Lease Inc., a
provider of Internet based marketing tools for equipment leasing companies from
June 1999 to March 2000. From November 1995 to March 1998 Mr. Herrick was Vice
President of US Operations for Americ Disc, a manufacturer and distributor of
compact disks. From September 1993 until November 1995, he was a founder and
Chief Operating Officer of Triptych CD, a CDROM start-up, which was subsequently
sold to Americ Disc. Concurrently, from January 1991 until April 1994,
Mr. Herrick served as President of SJ Packaging Corporation, an offset printing
company. Prior to 1991 Mr. Herrick was Vice President and General Manager of
Data Products Europe for Xidex Corporation, a manufacturer and distributor of
storage media products.
GARY B. FILLER has served as a director of the Company since August 1998 and
as Acting Chief Financial Officer of the Company since March 1999. Prior to
joining the Company, he was Senior Vice President and Chief Financial Officer of
Diamond Multimedia Systems, Inc., a manufacturer of graphics boards and modems,
from January 1995 to September 1996. From June 1994 to January 1995, Mr. Filler
was a business consultant and private investor. From February 1994 until
June 1994, he served as Executive Vice President and Chief Financial Officer of
ASK Group, Inc., a computer systems company. Mr. Filler was Chairman of the
Board of Seagate Technology, Inc., a manufacturer and distributor of data
storage, retrieval and management products ("Seagate"), from September 1991
until October 1992, and was Vice Chairman of the Board of Seagate from
October 1990 until September 1991. Mr. Filler currently serves as Co-Chairman of
the Board of Seagate and as a director of Seagate Software, Inc., a subsidiary
of Seagate.
KIM A. COOPER was appointed to serve as a director of Sento in August 1999.
Mr. Cooper is currently the Chairman of the Board and Chief Executive Officer of
Digital Harbor International, Inc., a component software developer of JAVA
applications ("Digital Harbor"), positions he has held since founding Digital
Harbor in January 1996. Prior to founding Digital Harbor, Mr. Cooper served for
two years as Vice President of Worldwide Marketing and Business Development for
Novell, Inc., a provider of director-enabled networking software. Mr. Cooper
also serves as a director of National Tech Team Inc., a multi-national provider
of desktop management services to national and multi-national governmental
entities and service organizations and a number of Fortune 500 companies.
LYNDON L. RICKS was appointed to serve as a director of Sento in
October 1999. Since 1992, Mr. Ricks has been an attorney in private practice
with the law firm of Kruse, Landa & Maycock, L.L.C., located in Salt Lake City,
Utah. Prior to undertaking his present position, Mr. Ricks was engaged in the
private practice of law with two firms located in Salt Lake City, Utah from 1982
until 1993. Mr. Ricks' legal practice is focused on securities compliance,
mergers and acquisitions, corporate matters and general business transactions.
Mr. Ricks served as a chairman of the Securities Section of the Utah State Bar
from 1996 to 1997.
COMMITTEES AND MEETINGS
The Board of Directors has formed a standing Audit Committee, the members of
which are Kim A. Cooper, Kieth E. Sorenson, and Lyndon L. Ricks. The Audit
Committee held one meeting during the fiscal year ended March 31, 2000. The
Audit Committee's functions include the recommendation of the Company's
independent auditors and the review of the Company's internal accounting and
financial practices and controls, and all services performed by the Company's
independent auditors.
The Board of Directors has also formed a standing Compensation Committee,
the members of which are Kim A. Cooper, Kieth E. Sorenson, and Dennis L.
Herrick. The Compensation Committee held two meetings during the fiscal year
ended March 31, 2000. The Compensation Committee currently serves as the
committee that administers the Plan and the Company's 1999 Omnibus Stock
Incentive Plan (the "Incentive Plan").
3
<PAGE>
During the fiscal year ended March 31, 1999, the Board of Directors held
twelve meetings. No director attended fewer than 75% of the total number of
meetings of the Board and of the committees on which he served. The Company does
not maintain a standing nominating committee of the Board of Directors.
DIRECTOR COMPENSATION
Non-employee directors of the Company receive compensation of $1,500 for
attendance at each Board meeting, $750 for each telephonic Board meeting, and
$1,000 for each committee meeting not held in conjunction with a regular Board
meeting ($500 if the committee meeting is held in conjunction with a Board
meeting). In addition, upon appointment to the Board each non-employee director
is granted an option to purchase 30,000 shares of Common Stock (vesting in four
increments of 7,500 shares per year) and in connection with each annual meeting
of the Company's shareholders each non-employee director is granted an option to
purchase 5,000 shares of Common Stock (vesting in four increments of 1,250
shares per year). All directors are reimbursed for expenses incurred in
connection with attendance at Board and committee meetings
EXECUTIVE OFFICERS
In addition to Messrs. Herrick and Filler, whose biographies are set forth
above, certain biographical information is furnished below with respect to the
following executive officers of the Company and its subsidiaries:
RONNIE JOHANSEN, 39, has served as the Vice President of Operations of Sento
since September 1999. Prior to his appointment as Vice President of Operations,
Mr. Johansen served as the Vice President of Sento Technical Services from
July 1998 until September 1999. Prior to joining Sento, Mr. Johansen served as
Director of Customer Service for Novonyx, Inc., a joint venture formed by
Novell, Inc. and Netscape Inc., from July 1997 until May 1998 and as a Director
of EMEA Technical Services for Novell, Inc. in the Netherlands from
November 1994 until July 1996. From August 1996 to July 1998, Mr. Johansen
worked as an independent consultant for several international business ventures.
He was also employed as Director of International Development for WordPerfect
Corporation from 1987 until 1994. Mr. Johansen received a B.A. degree in Russian
Studies from Brigham Young University.
BRIAN W. BRAITHWAITE, 39, has served as Vice President and General Manager
of Sento Training Division since February 2000. Prior to his appointment as Vice
President and General Manager, Mr. Braithwaite served as Vice President of
Business Development from February 1998 to January 2000. In addition,
Mr. Braithwaite served as Vice President of Operations from January 1996 to
February 1998. Mr. Braithwaite is a founder of Spire Technologies, Inc. in 1986,
the predecessor to Sento Corporation. Mr. Braithwaite serves as a director of
several private high-tech and entrepreneurial companies.
STANLEY J. CUTLER, 58, has served as Sento's Corporate Controller since
November 1998 and as Corporate Secretary since July 1999. Previously he was
interim Vice President of Finance for Portola Packaging, a manufacturer of
closures for plastic containers with revenues of $200 million, from
December 1997 to November 1998. Mr. Cutler served as Controller for Diamond
Multimedia Systems, Inc., a multimedia and computer graphics and modem company,
from January 1995 to November 1997. Mr. Cutler has many years of experience as
controller and vice president of finance for high-tech companies in Silicon
Valley. Mr. Cutler is a certified public accountant and began his career in
accounting at Peat Marwick Mitchell & Co. in San Francisco, California.
4
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table provides certain summary information concerning the
compensation paid or accrued by the Company to or on behalf of the Company's
Chief Executive Officer, as well as all other executive officers of the Company
whose aggregate compensation for the fiscal year ended March 31, 2000 exceeded
$100,000 (collectively, the "Named Executive Officers"). Upon Mr. Sorenson's
resignation on April 22, 1999, Mr. Coombs was appointed to serve as the
Company's Chief Executive Officer. Upon Mr. Coombs' resignation on March 2,
2000, Mr. Herrick was appointed to serve as the Company's Chief Executive
Officer.
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
--------------------------------------------- ----------------------- --------
OTHER RESTRICTED SECURITIES ALL
ANNUAL STOCK UNDERLYING LTIP OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($) ($)
------------------ -------- -------- -------- ------------ ---------- ---------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis L. Herrick........ 2000 6,462 30,000 -- -- -- -- --
Chief Executive 1999 -- -- -- -- -- -- --
Officer(1) 1998 -- -- -- -- -- -- --
Arthur F. Coombs, III.... 2000 102,231 -- -- -- -- -- 212,278
Chief Executive Officer 1999 99,154 100,000 -- -- -- -- --
(Former)(2) 1998 -- -- -- -- -- --
Kieth E. Sorenson........ 2000 13,846 -- 110,000 -- -- -- --
Chief Executive Officer 1999 120,000 -- -- -- -- -- --
(Former) and Chairman 1998 34,462 100,000 -- -- -- -- --
of the Board(3)
Keith D. Barr............ 2000 94,728 -- -- -- -- -- 139,391
Chief Information 1999 76,328 -- -- -- -- -- --
Officer (Former)(4) 1998 -- -- -- -- -- -- --
Stanley J. Cutler........ 2000 92,308 15,000 -- -- -- -- --
Secretary and Corporate 1999 27,104 -- -- -- -- -- --
Controller(5) 1998 -- -- -- -- -- -- --
Gary B. Filler........... 2000 -- -- 102,000 -- -- -- --
Acting Chief Financial 1999 -- -- 8,500 -- -- -- --
Officer(6) 1998 -- -- -- -- -- -- --
</TABLE>
------------------------
(1) Mr. Herrick joined the Company in March 2000 with a base salary of $120,000.
(2) Amount shown as other compensation for Mr. Coombs represents the amount of
realized gain from the exercise of non-qualified stock options during the
year ended March 31, 2000.
(3) Amount shown as other annual compensation for Mr. Sorenson represents
payments made by the Company pursuant to a consulting agreement with
Mr. Sorenson (See "Employment Agreements and Change of Control
Arrangements").
(4) Amount shown as other compensation for Mr. Barr represents the amount of
realized gain from the exercise of non-qualified stock options during the
year ended March 31, 2000.
(5) Mr. Cutler joined the Company in November 1998 with a base salary of
$85,000.
(6) Amount shown as other annual compensation for Mr. Filler represents payments
made by the Company pursuant to a consulting agreement with Mr. Filler (See
"Employment Agreements and Change of Control Arrangements").
5
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth individual grants of options to acquire
shares of Common Stock made to the Named Executive Officers during the fiscal
year ended March 31, 2000.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
PERCENT OF TOTAL VALUE AT ASSUMED
OPTIONS ANNUAL RATES OF STOCK
GRANTED PRICE APPRECIATION FOR
TO EMPLOYEES OPTION TERM
OPTIONS IN EXERCISE EXPIRATION -----------------------
NAME GRANTED FISCAL YEAR PRICE DATE 5% 10%
---- -------- ---------------- -------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Kieth E. Sorenson................. 100,000 5% $1.75 Apr, 2004 $ 48,349 $ 106,839
Kieth E. Sorenson................. 30,000 2% $1.75 Apr, 2004 $ 14,505 $ 32,052
Arthur F. Coombs, III............. 400,000 20% $1.75 Apr, 2009 $440,226 $1,115,620
Gary B. Filler.................... 100,000 5% $6.25 Jan, 2005 $172,676 $ 381,569
Gary B. Filler.................... 5,000 0% $2.38 Aug, 2004 $ 3,288 $ 7,265
Keith D. Barr..................... 250,000 13% $1.75 Apr, 2009 $275,141 $ 697,262
Stanley J. Cutler................. 100,000 5% $1.75 Apr, 2009 $110,057 $ 278,905
Dennis L. Herrick................. 325,000 17% $4.50 Dec, 2009 $919,758 $2,330,848
</TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR END OPTION VALUES
The following table sets forth the aggregate value of unexercised options to
acquire shares of Common Stock held by the Named Executive Officers on
March 31, 2000 and the value realized upon the exercise of options during the
fiscal year ended March 31, 2000.
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
AT FY END 2000(2) FY END 2000($)(3)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED($)(1) UNEXERCISABLE UNEXERCISABLE
---- --------------- -------------- ------------------- -----------------------
<S> <C> <C> <C> <C>
Arthur F. Coombs, III(4)..... 50,000 $212,278 102,265/262,744 $455,357/$1,199,018
Kieth E. Sorenson............ -- -- 113,829/16,171 $ 526,459/$74,791
Keith D. Barr(5)............. 30,000 $139,391 65,485/164,515 $ 291,150/$750,100
Dennis L. Herrick............ -- -- --/325,000 $ --/$609,375
Stanley J. Cutler............ -- -- 60,416/139,584 $ 254,424/$595,576
Gary B. Filler............... -- -- 111,848/123,152 $ 521,563/$84,662
</TABLE>
------------------------
(1) Calculated based on the difference between the exercise price and the value
of the shares as of the date acquired.
(2) Includes shares of Common Stock subject to options exercisable within
60 days of March 31, 2000.
(3) Calculated based on the difference between the exercise price and the price
of a share of Common Stock on March 31, 2000. The price of the Common Stock
on March 31, 2000 was $6.375 per share (as reported on the Nasdaq (SmallCap)
Stock Market).
(4) Represents compensation recorded for Mr. Combs as a result of the grant and
exercise of 50,000 options during the fiscal year ended March 31, 2000.
(5) Represents compensation recorded for Mr. Barr as a result of the grant and
exercise of 30,000 options during the fiscal year ended March 31, 2000.
6
<PAGE>
EMPLOYMENT AGREEMENTS AND CHANGE OF CONTROL ARRANGEMENTS
Kieth E. Sorenson resigned as Chief Executive Officer on April 22, 1999, a
position he held since December 1, 1997. Upon his resignation, options
previously granted to Mr. Sorenson to purchase 900,000 shares of Common Stock
were canceled. Mr. Sorenson was granted options to purchase 100,000 shares of
Common Stock in April of 1999 as an incentive to remain in his capacity as
Chairman of the Board. In April 1999, Mr. Sorenson entered into a one-year
consulting agreement with the Company, whereby he was paid $10,000 per month.
The consulting agreement expired in April 2000.
The Incentive Plan provides that upon a change in control of the Company and
a subsequent relocation, termination or reassignment of a participant in the
Incentive Plan within one year, the options granted to such participant
immediately vest and become exercisable. The Named Executive Officers are among
the participants in the Incentive Plan.
On March 30, 1999, the Company contracted with Gary B. Filler to act as
Executive Vice President and Chief Financial Officer of the Company. Mr. Filler
is paid $8,500 per month under the contract, which is cancelable by either party
at any time. In addition, during the fiscal year ended March 31, 2000, the
Company granted to Mr. Filler options to purchase an aggregate of 100,000 shares
and 5,000 shares of Common Stock at exercise prices of $6.25 and $2.38 per
share, respectively.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In addition to the employment agreements, change of control arrangements and
consulting agreement noted above, on March 2, 2000, the Company and EchoPass
Corporation, a Delaware corporation ("EchoPass"), closed the transactions
contemplated by an Amended and Restated Contribution Agreement dated as of
March 1, 2000, between the Company and EchoPass (the "Contribution Agreement").
The transactions consummated pursuant to the Contribution Agreement as well as
transactions involving EchoPass that closed on or about March 2, 2000
(collectively, the "EchoPass Transactions") included: (i) the transfer by the
Company of certain technology developed or acquired by or licensed to the
Company (the "Technology") to EchoPass in exchange for 4,000,000 shares of the
Series A Convertible Preferred Stock, $.0001 par value per share, of EchoPass
(the "EchoPass Series A Preferred"), representing approximately 26% of the
issued and outstanding shares of the common stock of EchoPass (the "EchoPass
Common Stock") on a fully-diluted basis, (ii) the execution by the Company and
EchoPass of a Services Agreement, dated as of March 1, 2000, enabling the
Company to utilize the Technology (at most favored customer pricing) in
developing its existing and future eCustomer Contact Centers; (iii) the transfer
by the Company of certain tangible assets, consisting primarily of computer
equipment, to EchoPass in exchange for EchoPass' payment of $1,141,000 in cash
to the Company; and (iv) the resignation of certain former employees of the
Company, including Arthur F. Coombs, III, formerly the Company's Chief Executive
Officer, who became employees of EchoPass.
Certain directors and officers of the Company had material relationships
with EchoPass on the closing date of the EchoPass Transactions. In particular,
EchoPass was formed by certain directors, officers and employees of the Company.
Furthermore, certain existing directors and executive officers and other
employees of the Company (including Messrs. Sorenson, Coombs, Barr and Filler)
owned an aggregate of 915,000 shares of EchoPass Common Stock, representing an
aggregate of approximately 6% of the issued and outstanding shares of EchoPass
Common Stock as of such date on a fully-diluted basis. Messrs. Coombs and Barr
each owned 275,000 shares of EchoPass Common Stock and Messrs. Sorenson and
Filler each owned 100,000 shares of EchoPass Common Stock as of such closing
date. To facilitate the transition associated with the EchoPass Transactions,
the Company has retained Messrs. Coombs and Barr to provide transition services
until July 15, 2000 and has allowed their outstanding stock options to vest
through that date. In addition, prior to such closing date, three of the
Company's directors, Messrs. Sorenson, Coombs and Filler, also served as
directors of EchoPass.
7
<PAGE>
PRINCIPAL HOLDERS OF VOTING SECURITIES
PRINCIPAL HOLDERS
The following table sets forth information as of June 1, 2000 with respect
to the beneficial ownership of shares of the Common Stock by each person known
by the Company to be the beneficial owner of more than 5% of the Common Stock,
by each director or nominee, by each of the Named Executive Officers and by all
directors and officers as a group. Unless otherwise noted, each person named has
sole voting and investment power with respect to the shares indicated. The
percentages set forth below have been computed based on the number of
outstanding securities, excluding treasury shares held by the Company, which was
8,314,851 shares of Common Stock as of June 1, 2000.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP
AS OF JUNE 1, 2000
-------------------------
NUMBER OF PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES OF CLASS*
------------------------------------ --------- ----------
<S> <C> <C>
Common Stock:
Clemons F. Walker......................................... 449,600(1) 5%
748 Rising Star
Henderson, NV 89104
Dennis L. Herrick......................................... -- **
Gary B. Filler............................................ 158,848(2) 2%
Stanley J. Cutler......................................... 105,057(3) 1%
Kieth E. Sorenson......................................... 113,829(4) 1%
Lyndon L. Ricks........................................... 10,338(5) **
Kim A. Cooper............................................. 5,735(6) **
All officers and directors as a group (8 persons)......... 762,473(7) 9%
</TABLE>
------------------------
* Beneficial ownership as a percentage of the class for each person holding
options, warrants or other rights exercisable within 60 days of June 1, 2000
has been calculated as though shares of Common Stock subject to such options
were outstanding, but such shares have not been deemed outstanding for the
purpose of calculating the percentage of the class owned by any other
person.
** Represents less than 1% of the outstanding shares of Common Stock.
(1) Includes presently exercisable warrants to purchase 50,000 shares of Common
Stock, 250,900 shares of Common Stock held in the name of the Walker Family
Trust, and presently exercisable warrants to purchase 50,000 shares of
Common Stock held in the name of the Walker Family trust.
(2) Includes 32,000 shares of Common Stock and 10,000 shares of Common Stock
subject to presently exercisable warrants held by G.T. Investments, of which
Mr. Filler is the sole shareholder, and presently exercisable options to
purchase 111,848 shares of Common Stock.
(3) Includes presently exercisable options to purchase 68,750 shares of Common
Stock and presently exercisable warrants to purchase 10,000 Shares of Common
Stock.
(4) Includes presently exercisable options to purchase 113,829 shares of Common
Stock.
(5) Includes presently exercisable options to purchase 6,338 shares of Common
Stock.
(6) Includes presently exercisable options to purchase 5,735 shares of Common
Stock.
(7) Includes presently exercisable options to purchase 322,749 shares of Common
Stock and presently exercisable warrants to purchase 20,000 shares of Common
Stock.
8
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, as well as persons who beneficially own more
than ten percent of the Common Stock, to file initial reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission (the
"SEC") and the National Association of Securities Dealers. Reporting persons are
required by SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file. Based solely on a review of the copies of such
forms furnished to the Company and written representations from the Company's
executive officers and directors, the Company believes that no forms other than
the following were delinquent or were not filed during the most recent fiscal
year or prior years (to the extent not previously disclosed):
Mr. Robert K. Bench failed to file a Form 4 due on June 10, 1999. Mr. Bench
filed the delinquent Form 4 with the SEC on September 1, 1999. Mr. Keith D. Barr
failed to file a Form 3 due on May 1, 1999. Mr. Barr filed the delinquent
Form 3 with the SEC on May 18, 1999. Mr. Kim A. Cooper failed to file a Form 3
due on August 29, 1999. Mr. Cooper filed the delinquent Form 3 with the SEC on
February 28, 2000. Mr. Gary B. Filler failed to file a Form 4 due on July 10,
1999. Mr. Filler filed the delinquent Form 4 with the SEC on July 20, 1999.
Mr. Dennis Herrick failed to file a Form 3 due on March 17, 2000. Mr. Herrick
filed the delinquent Form 3 with the SEC on April 7, 2000.
AMENDMENT TO THE SENTO CORPORATION 1996 EMPLOYEE STOCK PURCHASE PLAN
GENERAL
On April 18, 1996, the Board of Directors adopted, subject to shareholder
approval, the Sento Corporation 1996 Employee Stock Purchase Plan (the "Original
Plan"), pursuant to which employees of the Company could purchase shares of the
Common Stock under a plan governed by Section 423 of the Internal Revenue Code
of 1986, as amended (the "Code"). The first offering under the Original Plan
commenced on April 15, 1996, subject to shareholder approval. The shareholders
of the Company approved the Original Plan on September 10, 1996. On July 15,
1999, the Board of Directors amended and restated the Original Plan in the form
of the Plan. The following description of the Plan does not purport to be
complete and is qualified in its entirety by reference to the full text thereof.
AMENDMENT
On April 18, 2000, the Board approved an amendment to the Plan providing for
an increase in the maximum number of shares of Common Stock available for
issuance under the Plan from 200,000 to 500,000 (the "Amendment"). The Board's
adoption of the Amendment is subject to ratification and approval by the
shareholders of the Company at the Annual Meeting.
DESCRIPTION OF THE PLAN
PURPOSE. The purpose of the Plan is to provide a method whereby employees
of the Company and certain of its subsidiaries will have an opportunity to
acquire a proprietary interest in the Company through the purchase of shares of
Common Stock. The Board of Directors believes that the Plan is important because
it provides incentives to present and future employees of the Company by
allowing them to share in the growth of the Company. The Plan is intended to
qualify as an "employee stock purchase plan" under Section 423 of the Code.
ADMINISTRATION. The Plan is administered by a committee (the "Committee")
of the Board of Directors consisting of no fewer than two members of the Board
of Directors. The Committee is presently composed of the Compensation Committee
of the Board of Directors. The Committee has the authority to interpret and
construe all provisions of the Plan and to make all decisions and determinations
relating to the operation of the Plan.
9
<PAGE>
DURATION. The Plan became effective upon its adoption by the Board of
Directors and will remain in effect until September 30, 2009 unless terminated
earlier by the Board of Directors. No termination of the Plan may adversely
affect the rights of any employee with respect to outstanding options under the
Plan without the consent of the employee.
SHARES SUBJECT TO PLAN. Subject to shareholder ratification of the
Amendment, the Plan's maximum share limitation will be increased to 500,000
shares. The maximum number of shares of Common Stock which may be issued under
the Original Plan is 200,000 shares. In the event the outstanding shares of
Common Stock are increased, decreased, changed into, or exchanged for a
different number or kind of shares or securities of the Company through
reorganization, merger, recapitalization, reclassification, stock split, reverse
stock split or similar transaction, the maximum number of shares available for
issuance under the Plan shall be proportionately adjusted; provided, however, no
adjustment shall be made for stock dividends (as defined in the Plan).
ELIGIBILITY. Participation in the Plan is limited to employees of the
Company and its subsidiaries who have completed ninety (90) days of continuous
employment with the Company since their most recent employment commencement
date. Employees who own five percent (5%) or more of the voting stock of the
Company, however, may not participate in the Plan. As of the Board's adoption of
the Amendment, there were approximately 345 employees eligible to participate in
the Plan.
OFFERINGS UNDER THE PLAN. The Plan provides for a series of twenty-seven
semi-annual offerings commencing on April 1(st) and October 1(st), respectively,
in each of the years during the term of the Plan, and terminating on the
succeeding September 30th and March 31st, respectively.
GRANTING OF OPTIONS. On the applicable offering commencement date, a
participating employee will be deemed to have been granted an option to
purchase, on the offering termination date, a maximum number of shares of Common
Stock equal to 15% of the employee's projected base pay for the offering period
divided by 85% of the fair market value (as hereinafter defined) of Common Stock
on the applicable offering commencement date. No employee will be granted an
option (a) if such employee would own or have the right to purchase 5% or more
of the total combined voting power of the Company or (b) which permits him or
her to purchase in excess of $25,000 of Common Stock per calendar year.
PARTICIPATION IN AN OFFERING. An individual who is an eligible employee at
the beginning of an offering may elect to participate in such offering by
submitting to the Company the prescribed form authorizing the Company to make
deductions from his or her pay on each payday during the time the employee is a
participant at any rate designated by the employee, but not exceeding 15% of the
employee's base pay. All such payroll deduction contributions will be held in a
non-interest bearing account. An employee's option to purchase Common Stock will
be deemed to have been exercised automatically on the offering termination date
applicable to such offering, unless the employee gives written notice to the
Company to withdraw such payroll deductions. The option will be deemed to have
been exercised for the purchase of the number of full shares of Common Stock
which the amount in the account will purchase (but not in excess of the maximum
number of shares for which an option has been granted to the employee), and any
excess in the account will be returned to the employee.
EXERCISE PRICE OF OPTIONS. The price per share to be paid by participants
under the Plan shall be the lesser of (a) 85% of the fair market value of the
Common Stock on the applicable offering commencement date or (b) 85% of the fair
market value of the Common Stock on the applicable offering termination date.
The fair market value of the Common Stock shall be the average of the high and
low bid prices as quoted on the "Pink Sheets," the OTC Bulletin Board, or
similar service on the applicable date or the nearest prior business day on
which such quotes are available, or, if the Common Stock is listed on an
exchange or automated quotation system, the closing sales price as reported on
such exchange or automated quotation system on the applicable date or the
nearest prior business day on which shares of the Common Stock
10
<PAGE>
traded. The closing price of the Common Stock in the Nasdaq (Small Cap) Stock
Market, as reported by the National Quotation Bureau on March 31, 2000 was
$6.375.
WITHDRAWAL; TERMINATION OF EMPLOYMENT. Upon withdrawal by a participating
employee prior to an offering termination date or the termination of a
participant's employment for any reason during an offering, including retirement
and death, the option granted to such employee shall immediately terminate in
its entirety, and the payroll deductions or other contributions credited to the
participant's account shall be returned to the participant, or, in the case of
death, his designated beneficiary, and shall not be used to purchase shares of
Common Stock under the Plan.
AMENDMENT AND TERMINATION. The Plan provides that the Board of Directors
may amend or terminate the Plan or any portion thereof at any time; provided,
however, that no amendment may be made without shareholder approval if such
amendment would (a) increase the maximum number of shares of Common Stock that
may be issued under any offering (except adjustments upon changes in the
Company's capitalization), or (b) amend the eligibility requirements of the Plan
or allow members of the Committee to purchase shares of Common Stock under the
Plan. No termination, modification, or amendment of the Plan may, without the
consent of an employee then having an option under the Plan to purchase Common
Stock, adversely affect the rights of such employee under such option.
GENERAL PROVISIONS. No participant or his or her legal representatives,
legatees or distributees will be deemed to be the holder of any shares of Common
Stock subject to an offering until the option has been exercised and the
purchase price for the shares has been paid. No payroll deductions credited to a
participant's stock purchase account nor any rights with regard to the exercise
of an option to purchase shares of Common Stock under the Plan may be assigned,
transferred, pledged or otherwise disposed of in any way by a participant other
than by will or the laws of descent and distribution. Options under the Plan
will be exercisable during a participant's lifetime only by the participant.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following tax discussion is a brief summary of federal income tax law
applicable to the Plan. The discussion is intended solely for general
information and omits certain information which does not apply generally to all
participants in the Plan.
GRANT OF OPTIONS. In the opinion of the Company, the Plan qualifies as an
"employee stock purchase plan" within the meaning of Section 423 of the Code. As
such, a recipient of options under the Plan incurs no income tax liability, and
the Company obtains no deduction, from the grant of the options. The payroll
deductions and other contributions by a participant to his account, however, are
made on an after-tax basis. Participants will not be entitled to deduct or
exclude from income or social security taxes any part of their payroll
deductions.
EXERCISE OF OPTIONS. An employee will not be subject to federal income tax
upon the exercise of an option granted under the Plan, nor will the Company be
entitled to a tax deduction by reason of such exercise. The employee will have a
cost basis in the shares of Common Stock acquired upon such exercise equal to
the option exercise price.
DISPOSITION OF SHARES ACQUIRED UNDER THE PLAN. In order to defer taxation
on the difference between the fair market value and exercise price of shares
acquired upon exercise of an option, the employee must hold the shares during a
holding period which runs through the later of one year after the option
exercise date or two years after the date the option was granted. The only
exceptions are for dispositions of shares upon death, as part of a tax-free
exchange of shares in a corporate reorganization, into joint tenancy with right
of survivorship with one other person, or the mere pledge or hypothecation of
shares.
If an employee disposes of stock acquired under the Plan before expiration
of the holding period in a manner not described above, such as by gift or
ordinary sale of such shares, the employee must recognize
11
<PAGE>
as ordinary compensation income in the year of disposition the difference
between the exercise price and the stock's fair market value as of the date of
exercise. This amount must be recognized as income even if it exceeds the fair
market value of the shares as of the date of disposition or the amount of the
sales proceeds received. The Company will be entitled to a corresponding
compensation expense deduction.
Disposition of shares after expiration of the required holding period
(including disposition upon death) will result in the recognition of gain or
loss in the amount of the difference between the amount realized on the sale of
the shares and the exercise price for such shares. Any loss on such a sale will
be a long-term capital loss. Any gain on such a sale will be taxed as ordinary
income up to the amount of the difference between exercise price and the stock's
fair market value as of the date of exercise with any additional gain taxed as a
long-term capital gain.
VALUE OF BENEFITS
The Company is unable to determine the amount of benefits that may be
received by participants under the Plan if the Amendment is adopted, as
participation is discretionary with each employee.
CERTAIN INTERESTS OF DIRECTORS
In considering the recommendation of the Board of Directors with respect to
the Amendment, shareholders should be aware that the members of the Board of
Directors have certain interests, which may present them with conflicts of
interest in connection with such proposal. As discussed above, all employees,
including directors who are employees of the Company, are eligible to purchase
Common Stock under the Plan. The Board of Directors recognizes that adoption of
the Amendment may benefit certain directors of the Company and their successors,
but believes that approval of the Amendment will advance the interests of the
Company and its shareholders by encouraging employees of the Company to make
significant contributions to the long-term success of the Company.
RECOMMENDATION OF BOARD OF DIRECTORS
The Board of Directors believes the Amendment is in the best interests of
the Company, and therefore, unanimously recommends that the shareholders vote
FOR approval of the Amendment and the provision therein for the increase in the
shares of Common Stock available for issuance under the Plan from 200,000 to
500,000.
RATIFICATION OF SELECTION OF AUDITOR AND CHANGES IN AUDITOR
The Audit Committee has recommended, and the Board of Directors has
selected, the firm of Ernst & Young LLP ("E&Y") of Salt Lake City, Utah,
independent certified public accountants, to audit the financial statements of
the Company for the fiscal year ending March 31, 2001, subject to ratification
by the shareholders. The Board of Directors anticipates that one or more
representatives of E&Y will be present at the Annual Meeting, will have an
opportunity to make a statement if they so desire and will be available to
respond to appropriate questions.
KPMG LLP ("KPMG"), the independent public auditors retained by the Company
for the fiscal year ended March 31, 1999 and the interim period through
June 30, 1999, were dismissed on November 24, 1999. The decision to change the
Company's independent public auditors was recommended by management and approved
by the audit committee of the Board of Directors. In connection with the audits
of the fiscal years ended March 31, 1999, and the subsequent interim period
through June 30, 1999, there were no disagreements with KPMG on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedures, which disagreement if not resolved to KPMG's satisfaction
would have caused them to make reference in connection with their opinion to the
subject matter of the disagreement. The audit reports of the Company's principal
accountants on the consolidated financial statements of the Company and its
subsidiaries as of and for the years ended March 31, 1999, with respect
12
<PAGE>
to KPMG, and 2000, with respect to E&Y, did not contain any adverse opinion or
disclaimer of opinion, nor were they qualified or modified as to uncertainty,
audit scope, or accounting principles.
Pursuant to the recommendation of management and the approval of the audit
committee of the Board of Directors, the Company determined to retain the
services of E&Y to audit the financial statements of the Company. No
consultations occurred between the Company and E&Y during the two fiscal years
and any interim period preceding the appointment of E&Y regarding the
application of accounting principles, the type of audit opinion that might be
rendered or other accounting, auditing or financial reporting issue.
The Company has requested that KPMG and E&Y review the foregoing disclosure
regarding the change in the Company's accountants, and that to the extent
required by the regulations promulgated by the SEC, they express an opinion on
whether they agree with such disclosures. E&Y was not required to provide a
response pursuant to such regulations. KPMG's response is set forth below:
We were previously principal accountants for Sento Corporation
and, under the date of March 31, 1999, we reported on the
consolidated financial statements of Sento Corporation and
subsidiaries as of and for the years ended March 31, 1999 and
1998. On November 24, 1999, our appointment as principal
accountants was terminated. We have read Sento Corporation's
statements included under the caption Ratification of Selection of
Auditor and Changes in Auditor in its Proxy Statement with respect
to its Annual Meeting of Shareholders scheduled to be held on
July 18, 2000, and we agree with such statements, except we are
not in a position to agree or disagree with Sento Corporation's
statement that the change was recommended and approved by the
audit committee or that no consultations occurred between the
Company and Ernst & Young LLP regarding the application of
accounting principles or the type of opinion that might be
rendered.
The Board of Directors recommends that shareholders vote FOR ratification of
the appointment of E&Y as the Company's independent auditor.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors knows of no
other matters to be presented for action at the Annual Meeting. However, if any
further business should properly come before the Annual Meeting, the persons
named as proxies in the accompanying form will vote on such business in
accordance with their best judgment.
PROPOSALS OF SHAREHOLDERS
In order to be included in the proxy statement and form of proxy relating to
the Company's annual meeting of shareholders to be held in 2001, proposals which
shareholders intend to present at such annual meeting must be received by the
corporate secretary of the Company, at the Company's executive offices, 808 East
Utah Valley Drive, American Fork, Utah 84003, no later than May 26, 2001.
ADDITIONAL INFORMATION
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO ANY PERSON FROM WHOM A PROXY IS
SOLICITED BY THE BOARD OF DIRECTORS, UPON THE WRITTEN REQUEST OF SUCH PERSON, A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED
MARCH 31, 2000, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO (AS
WELL AS EXHIBITS THERETO, IF SPECIFICALLY REQUESTED), REQUIRED TO BE FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. WRITTEN REQUESTS FOR SUCH INFORMATION
SHOULD BE DIRECTED TO STANLEY J. CUTLER, CORPORATE SECRETARY AND CONTROLLER OF
THE COMPANY, AT 808 EAST UTAH VALLEY DRIVE, AMERICAN FORK, UTAH 84003.
13
<PAGE>
PROXY
SENTO CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Gary B. Filler and Stanley J. Cutler, and
each of them, as proxies, with full power of substitution, and hereby authorizes
them to represent and vote, as designated below, all shares of Common Stock of
Sento Corporation, a Utah corporation (the "Company"), held of record by the
undersigned on June 16, 2000 at the Annual Meeting of Shareholders (the "Annual
Meeting") to be held at 808 East Utah Valley Drive, American Fork, Utah 84003,
on July 18, 2000, at 10:00 a.m., local time, or at any adjournment or
postponement thereof, upon the matters set forth below, all in accordance with
and as more fully described in the accompanying Notice of Annual Meeting and
Proxy Statement, receipt of which is hereby acknowledged.
<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS, each to FOR all nominees listed below
serve until the next annual (except as marked to the contrary below) / /
meeting of shareholders of the
Company and until their
respective successors shall
have been duly elected and
shall qualify.
<S> <C>
1. WITHHOLD AUTHORITY
to vote for all nominees listed below / /
</TABLE>
(INSTRUCTION: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name in the list below)
KIETH E. SORENSON DENNIS HERRICK GARY B. FILLER
KIM A. COOPER LYNDON L. RICKS
2. PROPOSAL TO APPROVE AND RATIFY an amendment to the Sento Corporation 1996
Employee Stock Purchase Plan (Amended and Restated) (the "Plan") to increase the
maximum number of shares of Common Stock, par value $.25 per share, of the
Company available for issuance under the Plan from 200,000 to 500,000.
/ / FOR / / AGAINST / / ABSTAIN
3. PROPOSAL TO RATIFY the appointment of Ernst & Young LLP as independent
auditors of the Company for the fiscal year ending March 31, 2001.
/ / FOR / / AGAINST / / ABSTAIN
4. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
(CONTINUED ON REVERSE SIDE)
<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEES NAMED ABOVE AND FOR THE
PROPOSAL TO APPROVE AND RATIFY THE AMENDMENT TO THE SENTO CORPORATION 1996
EMPLOYEE STOCK PURCHASE PLAN DESCRIBED ABOVE.
Please complete, sign and date this proxy where indicated and return it
promptly in the accompanying prepaid envelope.
DATED: ______________________, 2000
___________________________________
Signature
___________________________________
Signature if held jointly
(Please sign above exactly as the
shares are issued. When shares are
held by joint tenants, both should
sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give full title as
such. If a corporation, please sign
in full corporate name by president
or other authorized officer. If a
partnership, please sign in
partnership name by authorized
person.)
