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As filed with the Securities and Exchange Commission on October 10, 1996
Registration No. 333-10269
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
__________________________________
QUARTERDECK CORPORATION
(Exact name of registrant as
specified in its charter)
DELAWARE 95-4320650
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
__________________________________
13160 Mindanao Way
Marina del Rey, California 90292
(310) 309-3700
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
_____________________________________
BRADLEY D. SCHWARTZ, ESQ.
Senior Vice President and General Counsel
Quarterdeck Corporation
13160 Mindanao Way
Marina del Rey, California 90292
(310) 309-3700
(Name, address, including zip code and telephone number,
including area code, of agent for service)
__________________________________
COPY TO:
KAREN E. BERTERO, ESQ.
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue
Los Angeles, California 90071-3197
(213) 229-7000
__________________________________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement from the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.[ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.[ ]
THE REGISTRATION HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH
DATE OR DATES AS MAY BE NECESSARY TO DELAY IT EFFECTIVE DATE UNTIL THE
REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities. In any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any State.
SUBJECT TO COMPLETION, DATED OCTOBER 10, 1996
PROSPECTUS
QUARTERDECK CORPORATION
COMMON STOCK
($.001 PAR VALUE)
5,014,889 SHARES
This Prospectus relates to 5,014,889 shares of Common Stock,
par value $.001 per share ("Common Stock"), of Quarterdeck Corporation, a
Delaware corporation (the "Company"), which may be offered for sale from time to
time by the stockholders of the Company listed herein under "Selling
Stockholders" (the "Selling Stockholders"). The shares of Common Stock offered
hereby (hereinafter, the "Securities") were issued in connection with the
acquisition by the Company of Vertisoft Systems, Inc., Limbex Corporation and
certain assets of Interlink Technology Co. The Company is registering the
Securities pursuant to the terms of certain Registration Rights Agreements (the
"Registration Rights Agreements") between the Company and the Selling
Stockholders in order to provide the holders thereof with freely tradeable
securities, but the registration of the Securities does not necessarily mean
that all or any of the Securities will be sold by the Selling Stockholders.
The Company will not receive any of the proceeds from the sale
of the Securities. The Company will pay all of the expenses associated with
the registration of the Securities, estimated to be approximately $53,000.
The Selling Stockholders will pay the other costs, if any, associated with any
sale of the Securities.
See "Risk Factors" beginning on page 3 for certain
considerations relevant to an investment in the Securities.
The Common Stock is quoted on the Nasdaq National Market under
the symbol "QDEK." On October 9, 1996, the last reported sale price per share
of the Common Stock, as quoted on the Nasdaq National Market, was $6 9/16.
________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is October __, 1996.
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AVAILABLE INFORMATION
The Company has filed Registration Statements on Form S-3 (the
"Registration Statements"), File No. 333-10269 with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), covering the Securities covered by this Prospectus. This
Prospectus omits certain information and exhibits included in the Registration
Statements, copies of which may be obtained upon payment of a fee prescribed by
the Commission or may be examined free of charge at the principal office of the
Commission in Washington, D.C.
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Commission. Such reports, proxy statements and other information filed
with the Commission by the Company can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the regional offices of the Commission located
at 500 West Madison Street, Room 1400, Chicago, Illinois 60606 and at the Jacob
K. Javits Federal Building, 75 Park Place, New York, New York 10278. Copies of
such material can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the
Commission are by this reference incorporated in and made a part of this
Prospectus: (i) the Annual Report on Form 10-K for the fiscal year ended
September 30, 1995, File No. 0-19207; (ii) the Quarterly Reports on Form 10-Q
for the quarters ended December 31, 1995, March 31, 1996 and June 30, 1996, File
No. 0-19207; (iii) the Registration Statement on Form 8-A filed April 26, 1991;
(iv) the Current Reports on Form 8-K dated December 29, 1995, March 28, 1996,
May 15, 1996, June 13, 1996, July 18, 1996, July 25, 1996, August 14, 1996,
August 27, 1996 and October 7, 1996 and Current Reports on Form 8-K/A dated
March 28, 1996 and July 18, 1996, and (v) all documents filed by the Company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date
of this Prospectus and prior to the filing of a post-effective amendment which
indicates that all Securities offered hereby have been sold or which deregisters
all Securities then remaining unsold. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
Copies of all documents that are incorporated herein by
reference (not including the exhibits to such documents, unless such exhibits
are specifically incorporated by reference into such documents or into this
Prospectus) will be provided without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon a written or oral
request to Quarterdeck Corporation, Attention: Corporate Secretary, 13160
Mindanao Way, Third Floor, Marina del Rey, California 90292, telephone number
(310) 309-3700.
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THE COMPANY
The Company develops, markets and supports computer software
products primarily in the utilities and Internet areas. The Company's utility
products enhance the performance of personal computers running Microsoft Windows
3.x, Windows 95, Windows NT and DOS software. The Company's Internet products
and services relate to information management and communications/collaboration
solutions.
The Company was incorporated in California in 1982 as
Quarterdeck Office Systems. In June 1991, the Company changed its state of
incorporation from California to Delaware and in February 1995 changed its name
to Quarterdeck Corporation.
The principal offices of the Company are located at 13160
Mindanao Way, Third Floor, Marina del Rey, California 90292, telephone number
(310) 309-3700.
RISK FACTORS
The Securities offered hereby are speculative in nature and
involve a high degree of risk. In addition to the other information included
elsewhere in this Prospectus, the following factors should be considered
carefully in evaluating an investment in the Securities offered by this
Prospectus.
DEPENDENCE ON NEW PRODUCTS AND ADAPTATION TO TECHNOLOGICAL CHANGE
The computer software industry is subject to rapid
technological change often evidenced by new competing products and improvements
in existing products. The Company depends on the successful development of new
products, including upgrades of existing products, to replace revenues from
products introduced in prior years that have begun to experience reduced
revenues. If the Company's leading products become outdated and lose market
share or if new products or existing product upgrades are not introduced when
planned or do not achieve the revenues anticipated by the Company, the
Company's operating results could be materially adversely affected. Even with
normal development cycles, the market environment can change so quickly that
features in certain products can become outdated soon after market
introduction. These events may occur in the future and may have an adverse
effect on future revenues and operating results.
Many of the Company's existing products supplement and enhance
Windows 3.x and the DOS operating system by providing multitasking and memory
management capabilities. Microsoft Windows 95, which was released in August
1995, integrates a 32-bit version of Windows with DOS. As application programs
and device drivers are developed to take advantage of this 32-bit operating
environment, they are expected to lack certain of the memory limitations
inherent in current versions of DOS and Windows and in DOS-based applications.
With the introduction of Windows 95, the software market is
experiencing a shift to this new platform. The Company is focusing its
development efforts on Windows 95 and Windows NT, while continuing to support
Windows 3.x and DOS platforms. In September 1995, the Company released several
new utility products for Windows 95, including memory compression (MagnaRAM),
diagnostics (WINProbe) and disk management (CleanSweep). QEMM, the Company's
leading memory management product, has been upgraded to version 8; QEMM 8
enhancements include new memory solutions and reporting utilities for Windows
3.x and Windows 95, as well as continued support for DOS systems. It is the
Company's expectation that memory management products will continue to be
needed on Windows 95, but that memory management has experienced a shift from
16-bit DOS device driver management (older versions of QEMM) to complex
solutions such as memory compression and better use of virtual memory (QEMM 8).
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The Company is devoting substantial efforts to the development
of software products that are designed to operate on Microsoft's Windows 95 and
Windows NT. Should the Company not be able to continue to develop products
successfully and timely that function under Windows 95 and Windows NT, and
offer perceived value to Windows 95 and Windows NT users, future revenues would
be adversely affected. There can be no assurance that QEMM 8 or the Company's
other utility products for Windows 95 and Windows NT will be commercially
successful.
The Company is also focusing significant efforts on products
for the telecommunications and collaborative computing and Internet markets and
expects that a significant portion of future revenues will come from these
products. The revenues from such new products may be less than the Company
anticipates due to various factors including the timing of release in relation
to competitive products, and uncertainties surrounding the rate and extent of
development of these new and emerging markets. The Company's Internet-related
products are dependent upon the viability and continued growth of the Internet,
and its expanded use by businesses and individuals for networking and
communications.
COMPETITION
The personal computer market is intensely competitive, subject
to strategic alliances of hardware and software companies and characterized by
rapid changes in technology and frequent introductions of new products and
features. The Company's competitors include developers of operating systems,
applications and utility software vendors and personal computer manufacturers
that develop their own software products. The Company's current revenues and
profitability are dependent on the viability of the Microsoft Windows and DOS
operating systems and, with respect to the Company's Internet and
telecommunications and collaborative computing products, the continued
viability and growth of the Internet, the World Wide Web as well as the X
Window System market. The Company expects to encounter continued competition
both from established companies and from new companies that are now developing,
or may develop, competing products. Many of the Company's existing and
potential competitors have financial, marketing and technological resources
significantly greater than those of the Company.
The Company's memory management and other utility products
compete directly with the memory management and utility features of Microsoft
Windows 95 as well as Microsoft Windows 3.x and DOS, as well as with other
third-party memory management products and other utility software products.
The Company's telecommunications and collaborative computing products compete
with other telecommunications and collaborative computing and other PC X server
products from other third-party software vendors. These competitive products
are frequently bundled with computer hardware as well as with operating system
software.
Future competitive product releases may cause disruptions in
orders for the Company's products while users and the marketplace evaluate the
competitive products. The extent of the disruption in orders and the impact on
future orders of the Company's products will depend on various factors that are
not fully known at this time, including the level of functionality, performance
and features included in the final release of these competitive products and
the market's evaluation of competitive products compared to the then current
functionality, performance and features of the Company's products.
The Company's Internet-related products compete with Internet
access, creation and server tools from a variety of companies, including
Netscape Communications Corporation, Microsoft Corporation and other
connectivity, networking and Internet software application developers,
Internet access providers and other on-line service providers, as well as
operating system vendors, including Microsoft and IBM. The original Mosaic
browser developed by the National Center for Supercomputing Applications is
made available to be downloaded in electronic format for free from the
Internet. Certain competitors have also made versions of their Internet
access, creation and server products available on the Internet for users to
download at no charge or for extended evaluation. In addition, the market for
Internet products may be adversely impacted to the extent that vendors of PC
hardware or PC operating systems incorporate Internet tools, functions or
capabilities within their operating systems or PC hardware and thereby reduce
the market for stand-alone Internet products.
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The Company is dedicating substantial efforts on products and
services for the telecommunications and collaborative computing and Internet
markets and expects that a significant portion of future revenues will come
from these products and services. The revenues from such new products and
services may be less than the Company anticipates due to various factors
including the timing of release in relation to competitive products and
services, and uncertainties surrounding the rate and extent of development of
these new and emerging markets. The Company's Internet-related products and
services are dependent upon the viability and continued growth of the Internet,
and its expanded use by businesses and individuals for networking and
communications.
The Company anticipates that the type and level of competition
experienced to date will continue and may increase and that future sales of its
products will be dependent upon the Company's ability to timely and
successfully develop or acquire new products or enhanced versions of its
existing products for Windows 95 and Windows NT, Apple Macintosh and/or other
operating systems that may gain market acceptance, and to demonstrate to the
user a need for the Company's products while developers of operating systems
and competitive software products continue to enhance their products. To the
extent that operating system enhancements, competitive products or bundling of
competitive products with operating systems or computer hardware reduce the
number of users who perceive a benefit from the Company's products, sales of
the Company's products in the future would be adversely impacted.
FLUCTUATIONS IN OPERATING RESULTS AND STOCK PRICE
The Company's future operating results and stock price could be
subject to significant fluctuations and volatility. The Company's revenues and
quarterly operating results may experience significant fluctuations and be
unpredictable as the result of a number of factors including, among others,
introduction of new or enhanced products by the Company or its competitors,
rapid technological changes in the Company's markets, seasonality of revenues,
changes in operating expenses and general economic conditions. The Company's
net revenues and net income (loss) have fluctuated significantly from year to
year since the Company's initial public offering in June 1991. The Company's
pattern of revenues and earnings may also be affected by the phenomenon known as
"channel fill." Channel fill occurs following the introduction of a new product
or a new version of a product as distributors buy significant quantities of the
new product or version in anticipation of sales of such product or version.
Following such purchases, the rate of distributors' purchases often declines,
depending on the rates of purchases by end users or "sell-through." The
phenomenon of "channel fill" may also occur in anticipation of price increases
or in response to sales promotions or incentives, some of which may be designed
to encourage customers to accelerate purchases that might otherwise occur in
later periods. Channels may also become filled simply because the distributors
are unable to, or do not, sell their inventories to retail distribution or end
users as anticipated. If sell-through does not occur at a sufficient rate,
distributors will delay purchases or cancel orders in later periods or return
prior purchases in order to reduce their inventories. In addition, between the
date the Company announces a new version or new product and the date of release,
distributors, dealers and end users often delay purchases, cancel orders or
return products in anticipation of the availability of the new version of the
product. Such order delays or cancellations can cause material fluctuations in
revenues from one quarter to the next. Net revenues may be materially affected
favorably or adversely by these effects.
For the third quarter ended June 30, 1996, the Company suffered
a net loss of $22.9 million primarily due to a significant decline in
sell-through levels for memory management products, a decline to historic rates
of sell-through of PROCOMM PLUS data communication software following unusually
high sales after a new product launch in the prior quarter and slower than
planned integration of acquisitions. Additionally, on October 7, 1996, the
Company announced that results for the fourth quarter ended September 30, 1996
and for the 1996 fiscal year will fall well below expectations. Costs
associated with a comprehensive corporate restructuring that is expected to
reduce the workforce by approximately 40%, charges related to various recent
acquisitions and less than expected revenues in the quarter will result in a net
loss for the fourth quarter and will contribute to a net loss for the fiscal
year.
As a result of recent results, the Company's cash from
operations was less than expected in the last two quarters of fiscal 1996. On
September 30, 1996, the Company improved its cash position and strengthened its
balance sheet with the completion of a $20 million convertible preferred stock
and warrant offering. The Company may in the future explore various other
financing alternatives, if necessary, in order to finance the core business of
the Company and help provide adequate working capital for operations. There can
be no assurance that the Company will not suffer additional losses in the
future, that adequate operating funds will be internally generated, or that
additional financing, if necessary, will be available, or if available, will be
available on acceptable terms. Should product shipments be delayed, or should
the Company continue to experience significant shortfalls in anticipated
revenues or experience unforeseen expenses, the Company might not have
sufficient capital to meet its operating expenses.
The Company also has experienced wide fluctuations in its stock
price and may be subject to significant fluctuations in the future over a short
period of time. The trading price of the Common Stock increased from
approximately $3.00 in January 1995 to a high of approximately $39.00 in
December 1995 to a low of approximately $6.00 in September 1996. Fluctuations
may be due to factors specific to the Company, to changes in analysts'
estimates, or to factors affecting the computer industry or the securities
markets in general. In addition, any decline in revenues or quarterly operating
results, or failure to meet market expectations, could have an immediate and
significant adverse effect on the trading price of the Common Stock in any given
period.
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MANAGEMENT OF ACQUISITIONS AND GROWTH
Since June 1995, the Company has consummated a number of
acquisitions. The Company may make additional acquisitions in the future. While
these acquisitions have broadened the Company's product portfolio and sales
distribution channels, the acquisitions have resulted in the Company's competing
with companies and in markets where it has not previously competed. As a result,
there is uncertainty regarding customer acceptance of the combined products.
There can be no assurance that the Company will be successful in realizing
benefits from a broadened product portfolio and sales distribution channels. In
addition, it is critical to the Company's success to integrate effectively the
operations and businesses of the acquired companies, and to utilize effectively
acquired intellectual property. On October 7, 1996, the Company announced a
comprehensive corporate restructuring that is expected to reduce the workforce
by approximately 40%, primarily through the elimination of redundant positions
resulting from the ten acquisitions made by the Company since June 1995.
SUBSTANTIAL DEPENDENCE ON DISTRIBUTION CHANNELS
A substantial portion of the Company's domestic and
international sales are made through a limited number of personal computer
hardware and software distributors which represent the Company on a
non-exclusive basis. If the Company were to lose all or a significant portion
of the revenue attributable to any of its principal distributors, or if its
principal distributors were to lose sales of the Company's products to any of
their principal accounts, the loss could have a material adverse affect on the
Company's operating results. In addition, there has been a trend toward
consolidation of distributors of personal computer hardware and software
products. A reduction in the number of software distributors will increase the
Company's dependence upon its major distributors and could affect their
willingness to distribute and promote products of the Company.
PRODUCT RETURNS
Like other manufacturers of package software products, the
Company is exposed to the risk of product returns from distributors and reseller
customers. There can be no assurance that actual returns in excess of recorded
allowances will not result in a material adverse effect on business, operating
results and financial condition.
DEPENDENCE ON AND INTENSE COMPETITION FOR KEY PERSONNEL
Recruitment of personnel in the computer software industry is
highly competitive. The Company's success depends to a significant extent upon
the performance of its executive officers and other key personnel. The loss of
the services of key individuals could have a material adverse effect on the
Company. The Company's future success will depend in part upon its continued
ability to attract and retain highly qualified personnel. There can be no
assurance that the Company will be successful in attracting and retaining such
personnel.
PATENTS AND PROPRIETARY INFORMATION
The Company relies on a combination of trade secret, patent,
copyright and trademark laws, and license agreements to protect its rights to
its products. The Company holds two United States patents relating to memory
management, one of which expires in 2010 and the other of which expires in
2011. The Company believes that its software products are proprietary and
protects them with copyrights, trade secrets and non-disclosure agreements.
The Company provides its products to end users under a non-exclusive,
non-transferable license. Under the Company's current form of software license
agreement, software is to be used solely for internal operations on designated
computers at specified sites. The ability of software companies to enforce
such licenses has not been finally determined and there can be no assurance
that misappropriation will not occur. The Company's trademark and service mark
rights include rights associated with its use of its trademarks and
servicemarks, and rights obtained by registrations of its trademarks and
servicemarks ("marks"). The Company has applied for or obtained United States
trademark registrations for certain marks and has applied for or obtained
registrations in various international jurisdictions. The use and registration
rights of the Company for its marks do not assure that the Company has superior
rights to others that may have registered or used identical or related
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marks on related goods or services, nor that such registrations or uses will
not be used to attempt to foreclose use of a particular mark by the Company.
The extent to which U.S. and foreign copyright and patent laws
protect software as well as the enforceability of end-user licensing agreements
has not been fully determined. In addition, changes in the interpretation of
copyright and patent laws could expand or reduce the extent to which the
Company or its competitors are able to protect their software and related
intellectual property.
Because the computer industry is characterized by
technological changes, the policing of the unauthorized use of computer
software is a difficult task. Software piracy is expected to continue to be a
persistent problem for the packaged software industry. Despite steps taken by
the Company to protect its software products, third parties still make
unauthorized copies of the Company's products for their own use or for sale to
others. These concerns are particularly acute in certain international
markets. The Company believes that the knowledge, abilities and experience of
its employees, its timely product enhancements and upgrades and the
availability and quality of its support services provided to users are more
significant factors in protecting its software products than patent, trade
secret and copyright protection laws.
GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES
There are currently few laws or regulations directly
applicable to access to or commerce on the Internet. However, due to the
increasing popularity and use of the Internet, it is possible that a number of
laws and regulations may be adopted with respect to the Internet. Such laws
and regulations may cover issues such as user privacy, pricing and
characteristics and quality of products and services. The Telecommunications
Act of 1996 (the "1996 Act"), which was recently enacted and the judicial
interpretation of which is uncertain, imposes criminal penalties for
transmission of or allowing access to certain obscene communications over the
Internet and other computer services and contains additional provisions
intended to protect minors. In addition, America's Carriers Telecommunication
Association ("ACTA") recently filed a Petition for Declaratory Ruling Special
Relief, and Institution of Rulemaking (the "ACTA Petition") before the Federal
Communications Commission ("FCC"), arguing that the FCC has authority to
regulate the Internet and, as such, should regulate, as the telecommunications
carriers, providers of computer software products (such as the Company) which
enable voice transmission over the Internet. The ACTA Petition requests the
FCC to declare its authority over interstate and international
telecommunications services using the Internet, to order providers of the
aforementioned software to cease the sale of such software pending a
rulemaking, and to institute a rulemaking body to govern the use of the
Internet as a means for providing telecommunications services. The enactment
of the 1996 Act, and of any similar laws or regulations in the future, may
decrease the growth or use of the Internet, which could in turn decrease the
demand for the Company's services and products and increase the Company's cost
of doing business or otherwise have an adverse effect on the Company's
business, operating results and financial condition.
INTERNATIONAL OPERATIONS
The Company has operations in various foreign locations.
International operations are subject to certain risks common to international
activities, such as changes in foreign governmental regulations, tariffs and
taxes, export license requirements, the imposition of trade barriers,
difficulties in staffing and managing foreign operations, and political and
economic instability.
The Company conducts business in various foreign currencies and
is therefore subject to the transaction exposures that arise from foreign
exchange rate movements between the dates that foreign currency transactions are
recorded and the date that they are consummated. The Company is also subject to
certain exposures arising from the translation and consolidation of the
financial results of its foreign subsidiaries. The Company has from time to
time taken limited actions to attempt to mitigate the Company's foreign
transaction exposure. However, there can be no assurance that actions taken to
manage such exposure will be successful or that future changes in currency
exchange rates will not have a material impact on the Company's future operating
results. The Company does not hedge either its translation risk or its economic
risk.
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INTENTION REGARDING PAYMENT OF COMMON STOCK DIVIDENDS
The Company currently retains all of its earnings for use in
the expansion and operation of its business, and does not anticipate paying any
cash dividends in the foreseeable future. There can be no assurance that the
Company will pay cash dividends at any time, or that the failure to pay
dividends for a period of time will not adversely affect the market price of
the Common Stock.
DILUTION
The Company has made, and may make in the future, acquisitions
using shares of the Common Stock. An acquisition using shares of the Common
Stock would have the effect of reducing the percentage ownership of the Company
by each pre-acquisition stockholder.
FORWARD LOOKING STATEMENTS
When used herein or in documents incorporated herein by
reference, words such as "anticipates," "expects" and similar conditional
expressions and any other statements not based on historical fact are intended
to identify forward looking statements. Such statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those expressed in any of the forward-looking statements. Such risks and
uncertainties include, in addition to those set forth under "Risk Factors,"
those noted in the documents incorporated herein by reference.
SELLING STOCKHOLDERS
Except for the stockholders specified below, the Selling
Stockholders listed below received their shares of Common Stock in connection
with the Company's acquisition of Vertisoft Systems, Inc. ("Vertisoft") and
Limbex Corporation ("Limbex") by way of mergers (the "Mergers") of wholly owned
subsidiaries of the Company with and into Vertisoft and Limbex, respectively.
Interlink Technology Co. ("Interlink") received 205,000 shares
of Common Stock (the "Interlink Shares") in connection with the Company's
acquisition of substantially all of the assets of Interlink (the "Acquisition").
Interlink distributed the Interlink Shares to its shareholders on a pro rata
basis. As a result of such distribution, the persons listed below as
shareholders of Interlink are Selling Stockholders of up to the number of
shares of Common Stock set forth opposite their respective names.
As part of the Mergers and the Acquisition and pursuant to the
terms of the Registration Rights Agreements, the Company agreed to use its best
efforts to register the Common Stock issued or distributed to the Selling
Stockholders for offer or sale to the public. The registration of the
Securities, however, does not necessarily mean that all or any of the Securities
will be sold by the Selling Stockholders. Except as noted below, the Shares
offered represent all Shares owned by the respective Selling Stockholders.
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<TABLE>
<CAPTION>
Shares Offered
Selling Stockholder Hereby
------------------- --------------
<S> <C>
Anatoly Tikhman 2,442,214
Philip Johnson 832,212
Bradley Allen 602,964
Alexander Jacobson 576,640
Jacob Graudenz 225,573
Harold Lund(1) 82,000
Joseph Niosi(1) 82,000
Inference Corporation 77,897
Thomas Conticello(1) 41,000
Howard Morgan(2) 34,984
Thelma Birks 13,388
Clay Chisum 2,678
Michelle Kraus 1,339
</TABLE>
- ------------
(1) Shareholder of Interlink.
(2) Mr. Morgan owns an aggregate of 95,426 shares of Common Stock.
(3) Mr. Chisum owns an aggregate of 3,678 shares of Common Stock.
9
<PAGE> 11
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale
of the Securities offered hereby.
PLAN OF DISTRIBUTION
The Securities may be sold from time to time by the Selling
Stockholders, or by pledgees, donees, tranferees or other successors in
interest. Such sales may be made on one or more exchanges or in the
over-the-counter market or otherwise, at prices and at terms then prevailing or
at prices related to the then current market price, or in negotiated
transactions. The Securities may be sold by one or more of the following: (a) a
block trade in which the broker-dealer so engaged will attempt to sell the
Securities as agent but may position and resell a portion of the block as
principal to facilitate the transaction; (b) purchases by a broker-dealer as
principal and resale by such broker-dealer for its account pursuant to this
Prospectus; (c) an exchange distribution in accordance with the rules of such
exchange; and (d) ordinary brokerage transactions and transactions in which the
broker solicits purchasers. In effecting sales, broker-dealers engaged by the
Selling Stockholders may arrange for other broker-dealers to participate in the
resales. In addition, any securities covered by this Prospectus which qualify
for sale pursuant to Rule 144 may be sold under Rule 144 rather than pursuant to
this Prospectus.
The Selling Stockholders may also sell Securities short and
redeliver the Securities to close out such short positions. The Selling
Stockholders may also enter into option, hedging or other transactions with
broker-dealers which require the delivery to the broker-dealer of the Securities
registered hereunder, which the broker-dealer may resell or otherwise transfer
pursuant to this Prospectus. The Selling Stockholder may also loan or pledge
the Securities registered hereunder to a broker-dealer and the broker-dealer may
sell the Securities so loaned or upon a default the broker-dealer may effect
sales of the pledged Securities pursuant to this Prospectus.
Broker-dealers or agents may receive compensation in the form
of commissions, discounts or concessions from Selling Stockholders in amounts to
be negotiated in connection with the sale. Such broker-dealers and any other
participating broker-dealers may be deemed to be "underwriters" within the
meaning of the Securities Act of 1933, as amended (the "Act"), in connection
with such sales and any such commission, discount or concession may be deemed to
be underwriting discounts or commissions under the Act.
The Selling Stockholders may agree to indemnify any
broker-dealer or agent that participates in transactions involving sales of the
Securities against certain liabilities, including liabilities arising under the
Act.
There is no assurance that any of the Selling Stockholders
will offer for sale or sell any or all of the Securities covered by this
Prospectus.
LEGAL MATTERS
Certain legal matters will be passed upon for the Company by
Gibson, Dunn & Crutcher LLP, Los Angeles, California.
MISCELLANEOUS
NO DEALER, SALES REPRESENTATIVE OR ANY OTHER PERSON HAS BEEN
AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED
IN THIS PROSPECTUS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED
IN THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE SELLING
STOCKHOLDERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF ANY OFFER TO BUY, COMMON STOCK BY ANYONE IN ANY JURISDICTION IN
WHICH SUCH AN OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON
10
<PAGE> 12
MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
11
<PAGE> 13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following expenses will be paid by the Company.
<TABLE>
<S> <C>
SEC Registration Fee $13,402
Nasdaq Application Fee 17,500
Legal fees and expenses* 10,000
Accounting fees and expenses* 5,000
Blue sky fees and expenses* 2,500
Miscellaneous* 5,000
-------
TOTAL* $53,402
=======
- ---------------
</TABLE>
* Estimated.
No expenses in connection with the distribution contemplated by this
Registration Statement will be borne by the Selling Stockholders, other than
compensation paid to one or more broker-dealers in connection with distribution
transactions from time to time.
Item 15. Indemnification of Directors and Officers
As permitted by Section 145 of the Delaware General
Corporation Law, the Bylaws of the Registrant provide: (i) the Registrant is
required to indemnify its directors and officers and may indemnify its other
employees and agents, and persons serving in such capacities in other business
enterprises (including, for example, subsidiaries of the Registrant) at the
Registrant's request, to the fullest extent permitted by Delaware law,
including those circumstances in which indemnification would otherwise be
discretionary; (ii) the Registrant is required to advance expenses, as
incurred, to such directors and officers and may advance expenses to such other
employees and agents in connection with defending a proceeding (except that it
is not required to advance expenses to a person against whom the Registrant
brings a claim for breach of the duty of loyalty, failure to acting in good
faith, intentional misconduct, knowing violation of law or deriving an improper
personal benefit); (iii) the rights conferred in the Bylaws are not exclusive
and the Registrant is authorized to enter into indemnification agreements with
such directors, officers, employees and agents; (iv) the Registrant may
maintain director and officer liability insurance to the extent reasonably
available; and (v) the Registrant may not retroactively amend the Bylaw
provisions in a way that is adverse to such directors, officers, employees and
agents. The Registrant has also entered into an agreement with its directors
and certain of its officers indemnifying them to the fullest extent permitted
by the foregoing. These indemnification provisions, and the Indemnification
Agreements entered into between the Registrant and its directors and certain of
its officers, may be sufficiently broad to permit indemnification of the
Registrants' officers and directors for liabilities arising under the
Securities Act of 1933, as amended.
The Company's Stock Plans, as amended, provides for
indemnification by the Company of any committee member, officer or director
administering or interpreting such plan for actions not undertaken in bad faith
or fraud.
II-1
<PAGE> 14
ITEM 16. EXHIBITS
The following are filed as exhibits to this Registration
Statement:
<TABLE>
<CAPTION>
Exhibit Number Description
----------- -----------
<S> <C>
4.1 Registration Rights Agreement dated as of July 18, 1996 among
Quarterdeck Corporation, Vertisoft Systems, Inc., Vertisoft
Direct, Inc., Anatoly Tikhman, Philip Johnson and Jacob Graudenz
(previously filed as Exhibit 10.2 to the registrant's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1996 and
incorporated herein by this reference).
4.2 Registration Rights Agreement dated as of August 13, 1996 among
Quarterdeck Corporation, and the holders of capital stock of
Limbex Corporation listed on the signature pages thereto
(previously filed as Exhibit 10.2 to the registrant's Current
Report on Form 8-K dated August 13, 1996 and incorporated herein
by this reference).
4.3 Registration Rights Agreement dated as of July 16, 1996 among
Quarterdeck Corporation, Interlink Technology Co.,
Harold Lund, Joseph Niosi and Thomas Conticello.
5.1 Opinion and consent of Gibson, Dunn & Crutcher LLP.
23.1 Consent of Gibson, Dunn & Crutcher LLP (contained in
Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent certified
public accountants.
23.3 Consent of Arthur Andersen, LLP independent certified public
accountants.
23.4 Consent of KPMG Peat Marwick LLP, independent certified public
accountants.
23.5 Consent of KPMG Peat Marwick LLP, independent certified public
accountants.
23.6 Consent of Williams Keepers LLP, independent certified public
accountants.
23.7 Consent of Caracansi and Company, P.C., independent certified
public accountants.
24.1 Power of Attorney.*
- ---------------------
* Previously filed.
</TABLE>
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered thereby and the offerings of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matters has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events which, individually or together, represent a
fundamental change in the information in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and
II-2
<PAGE> 15
price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration
statement;
(iii) To include any additional or changed material
information on the plan of distribution;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
II-3
<PAGE> 16
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Los Angeles, State of California, on this 8th day of October, 1996.
QUARTERDECK CORPORATION
By: FRANK R. GREICO
--------------------------
Frank R. Greico
Senior Vice President and
Chief Financial Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933,
this Amendment has been signed below by the following persons in the capacities
and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Member of the Office of the President (Principal October 8, 1996
-------------------------------------- Executive Officer), Director
King R. Lee
FRANK R. GREICO Senior Vice President and Chief Financial October 8, 1996
-------------------------------------- Officer (Principal Financial and Accounting
Frank R. Greico Officer)
* Chairman, Director October 8, 1996
--------------------------------------
Frank W.T. LaHaye
* Director October 8, 1996
--------------------------------------
Howard L. Morgan
Director October __, 1996
--------------------------------------
William Lane
*By: FRANK R. GREICO
----------------------------------
Frank R. Greico
Attorney-in-Fact
</TABLE>
II-4
<PAGE> 17
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Sequentially
Exhibit Numbered
Number Description Page
- ------ ----------- ------------
<S> <C> <C>
4.1 Registration Rights Agreement dated as of July 18,
1996 among Quarterdeck Corporation, Vertisoft Systems,
Inc., Vertisoft Direct, Inc., Anatoly Tikhman, Philip
Johnson and Jacob Graudenz (previously filed as
Exhibit 10.2 to the registrant's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1996 and
incorporated herein by this reference).
4.2 Registration Rights Agreement dated as of August 13,
1996 among Quarterdeck Corporation, and the holders of
capital stock of Limbex Corporation listed on the
signature pages thereto (previously filed as Exhibit 10.2
to the registrant's Current Report on Form 8-K dated
August 13, 1996 and incorporated herein by this reference).
4.3 Registration Rights Agreement dated as of July 16,
1996 among Quarterdeck Corporation, Interlink Technology
Co., Harold Lund, Joseph Niosi and
Thomas Conticello.
5.1 Opinion and consent of Gibson, Dunn & Crutcher LLP.
23.1 Consent of Gibson, Dunn & Crutcher LLP (contained
in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent
certified public accountants.
23.3 Consent of Arthur Andersen, LLP independent certified
public accountants.
23.4 Consent of KPMG Peat Marwick LLP, independent certified
public accountants.
23.5 Consent of KPMG Peat Marwick LLP, independent certified
public accountants.
23.6 Consent of Williams Keepers LLP, independent certified public
accountants.
23.7 Consent of Caracansi and Company, P.C., independent certified
public accountants.
24.1 Power of Attorney.*
- ---------------
* Previously filed.
</TABLE>
II-5
<PAGE> 1
EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of July 16, 1996, by and among Quarterdeck Corporation, a
Delaware corporation (the "Company"), InterLink Technology Co., a Delaware
corporation ("InterLink"), Harold Lund ("HL"), Joseph Niosi ("JN") and Thomas
Conticello ("TC") (each of HL, JN and TC individually to be referred to herein
as a "Stockholder" and collectively as the "Stockholders").
WHEREAS, InterLink is becoming the owner of shares of common
stock of the Company in connection with the acquisition by the Company of
certain assets of InterLink (the "Acquisition") pursuant to the terms of that
certain Asset Purchase Agreement and Plan of Reorganization dated as of July
16, 1996 (the "Acquisition Agreement") by and among the Company, InterLink and
the Stockholders; and
WHEREAS, pursuant to the terms of the Acquisition Agreement,
the Company has agreed to grant to InterLink the registration rights provided
for below.
NOW, THEREFORE, the parties hereto, in consideration of the
foregoing, the mutual covenants and agreements set forth in the Acquisition
Agreement and hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the
following capitalized defined terms shall have the following meanings:
"Closing" shall mean the closing of the Acquisition
on the date hereof.
"Common Shares" shall mean shares of common stock,
par value $.001 per share, of the Company.
"Holder" shall mean InterLink, so long as it holds
any Shares, and each Stockholder, so long as such Stockholder holds Shares as a
result of a distribution by, or a dissolution, liquidation or winding up of,
InterLink.
"Person" shall mean an individual or a corporation,
partnership, limited liability company, association, trust, or any other entity
or organization, including a government or political subdivision or an agency
or instrumentality thereof.
"Prospectus" shall mean any prospectus included in
the Registration Statement, including any resale prospectus and any preliminary
prospectus, and any amendment or supplement thereto, and in each case including
all material incorporated by reference therein.
"Registration Expenses" shall mean any and all
expenses incident to performance of or compliance with this Agreement,
including, without limitation: (i) all applicable registration and filing fees
imposed by the SEC and such securities exchange or exchanges on which Common
Shares are then listed or the National Association of Securities Dealers, Inc.
(the
<PAGE> 2
"NASD"); (ii) all fees and expenses incurred in connection with compliance with
state securities or "blue sky" laws (including reasonable fees and
disbursements of counsel in connection with qualification of any of the Shares
under any state securities or blue sky laws and the preparation of a blue sky
memorandum) and compliance with the rules of the NASD; (iii) all expenses of
any Persons in preparing or assisting in preparing, printing and distributing
the Registration Statement, any Prospectus, certificates and other documents
relating to the performance of and compliance with this Agreement; (iv) all
fees and expenses incurred in connection with the listing, if any, of any of
the Shares on any securities exchange or exchanges pursuant to Section 3(i)
hereof; and (v) the fees and disbursements of counsel for the Company and of
the independent public accountants of the Company, including the expenses
relating to any special audits or "cold comfort" letters required by or
incident to such performance and compliance. Registration Expenses shall
specifically exclude underwriting discounts and commissions, the fees and
disbursements of counsel representing a Holder and transfer taxes, if any,
relating to the sale or disposition of Shares by a Holder.
"Registration Statement" shall mean the registration
statement filed by the Company pursuant to Section 2(a) of this Agreement, as
amended from time to time.
"SEC" shall mean the Securities and Exchange
Commission or any successor entity.
"Securities Act" shall mean the Securities Act of
1933, as amended from time to time.
"Shares" shall mean the Common Shares issued to
InterLink on the date hereof at the Closing.
2. REGISTRATION UNDER THE SECURITIES ACT.
(a) Registration.
(i) Subject to Section 6(b) below, the
Company shall file a registration statement on Form S-3 or an amendment to an
existing registration statement on Form S-3 (the "Registration Statement"),
within thirty (30) days following the Closing, relating to the sale by the
Holders of any or all of the Shares, and shall use its best efforts to cause
such registration statement to be declared effective by the SEC as soon as
practicable thereafter. The Company agrees to use its best efforts to keep the
Registration Statement continuously effective (and to include a Prospectus at
all times meeting the requirements of the Securities Act) for a period of six
(6) months from the closing of the Acquisition.
(ii) If the Holders desire different
methods of distribution of the Shares included in the Registration Statement,
the method of distribution shall be determined by the Holders of a majority of
the Shares to be included in such Registration Statement.
(b) Expenses. The Company shall pay all
Registration Expenses in connection with a registration pursuant to this
Agreement. Each Holder shall pay all underwriting discounts and commissions
relating to such Holder's Shares, the fees and disbursements of counsel
<PAGE> 3
representing such Holder and transfer taxes, if any, relating to the sale or
disposition of Shares by such Holder.
3. REGISTRATION PROCEDURES. In connection with the
obligations of the Company under Section 2 hereof, the Company shall:
(a) prepare and file with the SEC, within the
time period set forth in Section 2(a)(i) hereof, and use its best efforts to
have declared effective by the SEC, the Registration Statement, which shall (i)
be available for public resale of the Shares by the selling Holders, and (ii)
comply as to form in all material respects with the requirements of the
applicable form and include all financial statements required by the SEC to be
filed therewith;
(b) (i) prepare and file with the SEC such
amendments to the Registration Statement as may be necessary to keep it
effective for the applicable period; (ii) cause any Prospectus to be amended or
supplemented as required and to be filed as required by Rule 424 or any similar
rule that may be adopted under the Securities Act; (iii) respond as promptly as
practicable to any comments received from the SEC with respect to the
Registration Statement or any amendment thereto; and (iv) comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement during the applicable period
in accordance with the intended method or methods of distribution by the
selling Holders;
(c) furnish to each Holder, upon request and
without charge, as many copies of any Prospectus and any amendment or
supplement thereto as such Holder may request in order to facilitate the public
sale or other disposition of the Shares;
(d) use its best efforts to register or qualify
the Shares under all applicable state securities or blue sky laws of such
jurisdictions in the United States and its territories and possessions as any
Holder may reasonably request in writing and keep such registration or
qualification effective during the period the Registration Statement is
required to be kept effective; provided, however, that in connection therewith,
the Company shall not be required to (i) qualify as a foreign corporation to do
business or to register as a broker or dealer in any such jurisdiction where it
would not otherwise be required to qualify or register but for this Section
3(d), (ii) subject itself to taxation in any such jurisdiction with respect to
such registration or qualification, or (iii) file a general consent to service
of process in any such jurisdiction;
(e) notify each Holder promptly and, if requested
by a Holder, confirm in writing, (i) when the Registration Statement and any
post-effective amendments thereto have become effective, (ii) when any
amendment or supplement to a Prospectus has been filed with the SEC, (iii) of
the issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of the Registration Statement or any part thereof
or the initiation of any proceedings for that purpose, (iv) if the Company
receives any notification with respect to the suspension of the qualification
of the Shares for offer or sale in any jurisdiction or the initiation of any
proceeding for such purpose, and (v) of the happening of any event during the
period the Registration Statement is effective as a result of which (A) the
Registration Statement contains any untrue statement of a material fact or
omits to state any material fact required to be stated
3
<PAGE> 4
therein or necessary to make the statements therein not misleading or (B) a
Prospectus as then amended or supplemented contains any untrue statement of a
material fact or omits to state any material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading;
(f) use best efforts to obtain the withdrawal of
any order suspending the effectiveness of the Registration Statement by the SEC
or any state securities authority as promptly as possible;
(g) furnish to each Holder upon request, without
charge, at least one conformed copy of the Registration Statement and any
post-effective amendment thereto (without documents incorporated therein by
reference or exhibits thereto, unless requested);
(h) cooperate with the Holders to facilitate the
timely preparation and delivery of certificates representing Shares to be sold
and not bearing any Securities Act legend and enable certificates for such
Shares to be issued for such numbers of Shares and registered in such names as
the Holders may reasonably request; and
(i) use its best efforts to cause all Shares to
be listed on any securities exchange on which the Common Shares are then
listed, or included on the Nasdaq National Market if the Common Shares are then
so included.
4. CERTAIN AGREEMENTS OF HOLDERS.
(a) Each Holder shall (i) furnish to the Company
in writing such information regarding such Holder and such Holder's proposed
distribution of Shares as the Company may from time to time reasonably request
in connection with the preparation of the Registration Statement or the
registration or qualification of the Shares under state securities or blue sky
laws, and (ii) report to the Company within ten (10) days after the end of each
month all sales or other dispositions of Shares made by such Holder during such
month.
(b) Each Holder who executes this Agreement
agrees, if requested by the Company in the case of a Company-initiated
non-underwritten offering, or if requested by the managing underwriter or
underwriters in a Company-initiated underwritten offering, not to effect any
public sale or distribution of any Shares (including a sale pursuant to Rule
144 under the Securities Act), except as part of such Company-initiated
registration, during the ten (10) day period prior to, and during the ninety
(90) day period beginning on, the date of effectiveness of each
Company-initiated offering made pursuant to a registration statement, to the
extent such request is timely made in writing by the Company or the managing
underwriters.
5. INDEMNIFICATION, CONTRIBUTION.
(a) Indemnification by the Company. Subject to
Section 5(c), the Company agrees to indemnify and hold harmless each Holder and
its officers and directors and partners and each Person, if any, who controls
any Holder within the meaning of Section 15 of the Securities Act, as follows:
4
<PAGE> 5
(i) against any and all loss, liability,
claim, damage and expense whatsoever, as incurred, to which such Holder,
partner, officer, director or controlling Person may become subject under the
Securities Act or otherwise (A) that arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (B) that arise out of
or are based upon any untrue statement or alleged untrue statement of a
material fact contained in any Prospectus or any amendment or supplement
thereto, or the omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (C) that arise out
of or are based upon any violation or alleged violation by the Company of the
Securities Act, the Securities Exchange Act of 1934 (the "Exchange Act"), or
any federal or state securities law in connection with the offering covered by
the Registration Statement;
(ii) against any and all loss, liability,
claim, damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any claim, litigation, investigation or
proceeding by any governmental agency or body, commenced or threatened, based
upon any such untrue statement or alleged untrue statement, or omission or
alleged omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expenses
(including reasonable fees and disbursements of counsel) reasonably incurred in
investigating, preparing or defending against any claim, litigation,
investigation or proceeding by any governmental agency or body, commenced or
threatened, in each case whether or not a party, based upon any such untrue
statement or alleged untrue statement, or omission or alleged omission, that
relates to the sale by a Holder of Shares under the Registration Statement, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above; provided, however, that the indemnity provided pursuant to this Section
5(a) shall not apply to any Holder with respect to any loss, liability, claim,
damage or expense that arises out of or is based upon (1) any untrue statement
or alleged untrue statement or omission or alleged omission made in reliance
upon and in conformity with written information furnished to the Company by
such Holder expressly for use in the Registration Statement or any amendment
thereto or a Prospectus or any amendment or supplement thereto or (2) trades
made by such Holder in violation of Section 6(a) below.
(b) Indemnification by Holders. Each Holder
severally (but not jointly), in proportion of the number of Shares sold and to
be sold by each Holder pursuant to the Registration Statement, agrees to
indemnify and hold harmless the Company and the other Holders, and each of
their respective directors, officers and partners (including each director of
the Company and each officer of the Company who signs the Registration
Statement), and each Person, if any, who controls the Company or any other
Holder within the meaning of Section 15 of the Securities Act, to the same
extent as the indemnity contained in Section 5(a) hereof, but only insofar as
such loss, liability, claim, damage or expense arises out of or is based upon
(i) any untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement or any amendment thereto or a
Prospectus or any amendment or
5
<PAGE> 6
supplement thereto in reliance upon and in conformity with written information
furnished to the Company by the indemnifying Holder expressly for use therein
or (ii) trades made by the indemnifying Holder in violation of Section 6(a)
below; provided that, in the case of the indemnifying Holder's obligation set
forth in this Section 5(b) corresponding to Section 5(a)(ii) above, such
settlement must be effected with the written consent of such Holder.
(c) Conduct of Indemnification Proceedings. Each
indemnified party shall give reasonably prompt notice to each indemnifying
party of any action or proceeding commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party (i) shall not relieve the indemnifying party from any liability that it
may have under the indemnity agreement provided in Section 5(a) or (b) above,
except to the extent that it did not otherwise timely learn of such action or
proceeding and the lack of notice by the indemnified party materially
prejudices the indemnifying party or results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) shall not, in
any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided under
Section 5(a) or (b) above. After receipt of such notice, the indemnifying
party shall be entitled to participate in and, at its option, jointly with any
other indemnifying party so notified, to assume the defense of such action or
proceeding at such indemnifying party's own expense with counsel chosen by such
indemnifying party and approved by the indemnified party or parties, which
approval shall not be unreasonably withheld; provided, however, that, if the
defendants in any such action or proceeding include both an indemnified party
and an indemnifying party and the indemnified party reasonably determines, upon
advice of counsel, that a conflict of interest exists, then the indemnified
parties shall be entitled to counsel (which shall be limited to a single law
firm for all indemnified parties), the reasonable fees and expenses of which
shall be paid by the indemnifying parties. If none of the indemnifying parties
assumes the defense of any such action or proceeding, after having received the
notice referred to in the first sentence of this paragraph, the indemnifying
parties will pay the reasonable fees and expenses of counsel (which shall be
limited to a single law firm for all indemnified parties) for the indemnified
parties. In such event, however, no indemnifying party will be liable for any
settlement effected without the written consent of such indemnifying party. If
one or more of the indemnifying parties assumes the defense of any such action
or proceeding in accordance with this paragraph, such indemnifying party shall
not be liable for any fees and expenses of counsel for the indemnified parties
incurred thereafter in connection with such action or proceeding except as set
forth in the proviso to the second sentence of this Section 5(c).
(d) Contribution.
(i) In order to provide for just and
equitable contribution in circumstances in which the indemnity agreement
provided for in this Section 5 is for any reason held to be unenforceable
although applicable in accordance with its terms, the indemnifying parties
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity agreement incurred by the
indemnified party, in such proportion as is appropriate to reflect the relative
fault of and benefits to each indemnifying party and each indemnified party in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits to the indemnifying parties
and indemnified parties shall be determined by
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<PAGE> 7
reference to, among other things, the total proceeds received by each
indemnifying party and indemnified party in connection with the offering to
which such losses, claims, damages, liabilities or expenses relate. The
relative fault of each indemnifying party and indemnified party shall be
determined by reference to, among other things, whether the action in question,
including any untrue or alleged untrue statement of a material fact, or
omission or alleged omission to state a material fact, has been made by, or
relates to information supplied by, such indemnifying party or indemnified
party, and the parties' relative intent, access to information and opportunity
to correct or prevent such action.
(ii) The parties hereto agree that it
would not be just or equitable if contribution pursuant to this Section 5(d)
were determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to in
Section 5(d)(i) above.
(iii) Notwithstanding the foregoing, (1)
no Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation and (2) no Person who
violates Section 6(a) below shall be entitled to contribution from any Person
who was not guilty of violating Section 6(a) in any case where the right to
contribution is asserted in connection with a violation of Section 6(a).
(iv) For purposes of this Section 5(d),
each Person, if any, who controls a Holder within the meaning of Section 15 of
the Securities Act and directors, officers and partners of a Holder shall have
the same rights to contribution as such Holder, and each director of the
Company, each officer of the Company who signs the Registration Statement and
each Person, if any, who controls the Company within the meaning of Section 15
of the Securities Act shall have the same rights to contribution as the
Company.
(e) Notwithstanding any term or condition to the
contrary, the liability of any Holder pursuant to this Section 5 shall be
limited to the gross proceeds received by such Holder as a result of the sale
giving rise to the liability, except where such Holder is guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act).
(f) The obligations of the Company and the
Holders under this Section 5 shall survive the completion of any offering of
the Shares pursuant to the Registration Statement.
6. SUSPENSION OF REGISTRATION REQUIREMENT.
(a) Each Holder shall not effect any sales of
Shares pursuant to the Registration Statement after such Holder has received
notice from the Company to suspend sales as a result of the occurrence or
existence of any Suspension Event (as defined in Section 6(b) below) until the
Company provides notice to such Holder that all Suspension Events have ceased
to exist. In addition, each Holder shall not effect any sales of Shares
pursuant to the Registration Statement after such Holder has received notice
from the Company to suspend sales because the Registration Statement, any
Prospectus or any supplement thereto contains an untrue statement of
7
<PAGE> 8
a material fact or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, until the Company notifies such Holder that the
misstatement or omission has been corrected.
(b) Notwithstanding anything to the contrary set
forth in this Agreement, the Company's obligation to file the Registration
Statement and make any filings with any state securities authority, to use its
best efforts to cause the Registration Statement or any state securities
filings to become effective, or to amend or supplement the Registration
Statement or any state securities filings shall be temporarily suspended in the
event of and during a Suspension Event. A "Suspension Event" shall exist at
(i) any time that the Company is not eligible to use Form S-3 for the
Registration Statement or (ii) such times as the Company determines that
circumstances exist that make it impractical or inadvisable for the Company to
file, amend or supplement the Registration Statement or such filings or to
cause the Registration Statement or such filings to become effective (such
circumstances to include, without limitation, (A) the Company conducting an
underwritten primary public offering and being advised by the underwriters that
the sale of Shares under the Registration Statement would have a material
adverse effect on the Company's offering or (B) pending negotiations relating
to, or consummation of, a transaction or the occurrence of some other event (1)
where any of the foregoing would require disclosure under applicable securities
laws of material information in the Registration Statement (or any other
document incorporated into the Registration Statement by reference) or such
state securities filings and (2) as to which the Company has a bona fide
business purpose for preserving confidentiality or which renders the Company
unable to comply with SEC requirements). Suspension of the Company's
obligations pursuant to this Section 6(b) shall continue only for so long as a
Suspension Event or its effect is continuing. The Company shall notify each
Holder promptly after any Suspension Event occurs or ceases to exist.
7. MISCELLANEOUS.
(a) Amendments and Waivers. The provisions of
this Agreement, including the provisions of this sentence, may not be amended,
modified, supplemented or waived, nor may consent to departures therefrom be
given, without the written consent of the Company and the Holders of 50% of the
Shares then held by the Holders.
(b) Notices. All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand delivery, registered first-class mail, telex, telecopier, or any courier
guaranteeing overnight delivery, (i) if to a Holder, at such Holder's
registered address appearing on the share register of the Company, and if no
such address appears or if such address is incorrect, then to the address of
InterLink, or (ii) if to the Company, at 13160 Mindanao Way, 3rd Floor, Marina
del Rey, California, Attention: Law Department. All such notices and
communications shall be deemed to have been duly given: at the time delivered
by hand, if personally delivered; five (5) business days after being deposited
in the mail, postage prepaid, if mailed; when answered back, if telexed; when
receipt is acknowledged, if telecopied; or at the time delivered if delivered
by an air courier guaranteeing overnight delivery.
(c) Successors and Assigns. This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of the
Company. This Agreement and the
8
<PAGE> 9
registration rights granted hereunder may not be assigned by a Holder without
the consent of the Company and such assignee agreeing to be bound by the
provisions of this Agreement.
(d) Counterparts. This Agreement may be executed
in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
(e) Headings and Interpretation. The headings in
this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof. In construing the meaning of this
Agreement, no party hereto nor its counsel shall be deemed the drafter of this
Agreement, and this Agreement shall be construed according to its fair meaning
and not strictly for or against any Person as the drafter hereof.
(f) Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California without giving effect to the conflicts of law provisions thereof.
(g) Entire Agreement. This Agreement is intended
by the parties as a final expression of their agreement and intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. This
Agreement supersedes all prior oral and written agreements and understandings
and all contemporaneous written agreements and understandings between the
parties with respect to such subject matter.
(h) Attorneys' Fees. In the event of any suit or
other proceeding to construe or enforce any provision of this Agreement, or
otherwise in connection with this Agreement, the prevailing party's or parties'
reasonable attorneys' fees and costs (in addition to all other amounts and
relief to which such party or parties may be entitled) shall be paid by the
other party or parties in such suit or proceeding.
9
<PAGE> 10
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
QUARTERDECK CORPORATION
By:
-------------------------------
Name:
Title:
INTERLINK TECHNOLOGY CO.
By:
-------------------------------
Name: Harold Lund
Title:
----------------------------------
Harold Lund
----------------------------------
Joseph Niosi
----------------------------------
Thomas Conticello
10
<PAGE> 1
EXHIBIT 5.1
October 8, 1996
(213) 229-7000 C 73127-00018
Quarterdeck Corporation
13160 Mindanao Way
Marina del Rey, California 90292
Re: Quarterdeck Corporation -
Form S-3 Registration Statement
File No. 333-10269
Ladies and Gentlemen:
We have acted as special counsel to Quarterdeck Corporation, a Delaware
corporation (the "Company"), in connection with the registration by the Company
on Form S-3 (the "Registration Statement") under the Securities Act of 1933, as
amended, of 5,014,889 shares of the Company's common stock, $.001 par value (the
"Shares"). The Shares are being offered for sale by certain stockholders of the
Company (the "Selling Stockholders") identified in the Registration Statement.
On the basis of such investigation as we have deemed necessary, we are
of the opinion that the Shares to be offered for sale by the Selling
Stockholders have been duly authorized and either (i) are validly issued, fully
paid and non-assessable, or (ii) upon issuance in accordance with the terms of
that certain Agreement and Plan of Reorganization dated as of August 13, 1996
among the Company, Limbex Corporation ("Limbex") and the shareholders of Limbex
listed on the signature pages thereto, will be validly issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the heading
"Legal Matters" contained in the prospectus that forms a part of the
Registration Statement.
Very truly yours,
GIBSON, DUNN & CRUTCHER LLP
<PAGE> 1
EXHIBIT 23.2
The Board of Directors
Quarterdeck Corporation:
We consent to the incorporation by reference in amendment No. 1 to the
registration statement (No. 333-10269) on Form S-3 of Quarterdeck Corporation of
our report dated November 8, 1995, except as to Note 14 which is as of March 28,
1996, with respect to the consolidated balance sheets of Quarterdeck Corporation
and subsidiaries as of September 30, 1995 and 1994, and the related consolidated
statements of operations, stockholders' equity, and cash flows for each of the
years in the three-year period ended September 30, 1995, which report appears in
the Form 8-K/A of Quarterdeck Corporation dated March 28, 1996.
KMPG Peat Marwick LLP
Los Angeles, California
October 9, 1996
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-3 (No. 333-10269) of
Quarterdeck Corporation of our report dated March 1, 1996, relating to the
balance sheets of Datastorm Technologies, Inc. as of December 31, 1995 and
1994, and the related statements of income and changes in retained earnings,
and cash flows for the years then ended, included in the Form 8-K/A of
Quarterdeck Corporation dated March 28, 1996.
Arthur Andersen, LLP
St. Louis, Missouri,
October 8, 1996
<PAGE> 1
EXHIBIT 23.4
The Board of Directors
Vertisoft Systems, Inc.:
We consent to the incorporation by reference in the registration statement
No. 333-10269) on Form S-3 of Quarterdeck Corporation of our report dated
September 13, 1996, with respect to the consolidated balance sheet of Vertisoft
Systems, Inc. as of January 31, 1996, and the related statements of operations,
shareholders' equity, and cash flows for the year then ended, which report
appears in the Form 8-K of Quarterdeck Corporation dated July 18, 1996.
KMPG Peat Marwick LLP
Los Angeles, California
October 9, 1996
<PAGE> 1
EXHIBIT 23.5
The Board of Directors
Limbex Corporation:
We consent to the incorporation by reference in registration statement
(No. 333-10269) on Form S-3 of Quarterdeck Corporation of our report dated
August 16, 1996, with respect to the consolidated balance sheet of Limbex
Corporation as of March 31, 1996, and the related statements of operations,
shareholders' equity, and cash flows for the period from May 5, 1995 (inception)
through March 31, 1996, which report appears in the Form 8-K of Quarterdeck
Corporation dated July 18, 1996.
KMPG Peat Marwick LLP
Los Angeles, California
October 9, 1996
<PAGE> 1
EXHIBIT 23.6
[WILLIAMS-KEEPERS LLP LETTERHEAD]
The Board of Directors
Quarterdeck Corporation:
We consent to the incorporation by reference in the registration statements
(No. 333-10269) of Form S-3 of Quarterdeck Corporation of our report dated
February 25, 1994, with respect to the balance sheet of Datastorm Technologies,
Inc., as of December 31, 1993, and the related statements of income, retained
earnings and cash flows for the year then ended, which appears in the Form 8-K
of Quarterdeck Corporation dated May 24, 1996.
Williams-Keepers LLP
/s/ WILLIAMS-KEEPERS LLP
Columbia, Missouri
September 30, 1996
<PAGE> 1
EXHIBIT 23.7
[CARACANSI AND COMPANY, P.C. LETTERHEAD]
The Board of Directors
Quarterdeck Corporation
We consent to the incorporation by reference in the Registration Statements on
Form S-3 (No. 33-96064, No. 333-4606, and No. 333-10269), on Form S-4 (No.
333-03723), and on Form S-8 (No. 333-01766 and No. 333-4602) of Quarterdeck
Corporation of our report dated October 16, 1995 with respect to the balance
sheets of Inset Systems, Inc. as of March 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years then
ended, which report appears in the current report on Form 8-K filed on January
11, 1996 of Quarterdeck Corporation.
/s/ CARACANSI AND COMPANY, P.C.
CARACANSI AND COMPANY, P.C.
Danbury, CT
September 27, 1996
