<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The table below lists the current Directors and Executive Officers of the
Company:
<TABLE>
<CAPTION>
Served
as Director
Director Term
Name Age Position with Company Since Expires
- ---- --- -------------------------------------------------- -------- --------
<S> <C> <C> <C> <C>
Andrew J. Filipowski.... 48 President, Chief Executive Officer and 1987 2000
Chairman of the Board of Directors
Paul L. Humenansky...... 41 Executive Vice President--Product Development, 1991 1999
Chief Operations Officer and Director
Michael P. Cullinane.... 49 Executive Vice President, Chief Financial Officer, 1991 1999
Treasurer and Director
James E. Cowie(1)(2).... 44 Director 1989 2000
Steven D. Devick(1)(2).. 47 Director 1989 2000
Arthur P. Frigo(1)(2)... 57 Director 1997 2001
Gian Fulgoni(1)......... 51 Director 1991 2001
Thomas A. Slowey........ 38 Executive Vice President--Sales
Paul A. Tatro........... 42 Executive Vice President--International Operations
</TABLE>
- --------
(1) Member of Audit Committee.
(2) Member of Compensation Committee.
Mr. Filipowski, a founder of the Company, has been President, Chief
Executive Officer and Chairman of the Board of Directors since the Company's
formation in April 1987. Mr. Filipowski is also a director of System Software
Associates, Inc., Blue Rhino Corporation and Platinum Entertainment, Inc., a
publicly held integrated music recording and publishing company.
Mr. Humenansky, a founder of the Company, was appointed Chief Operations
Officer of the Company effective January 1993. Mr. Humenansky also serves as
Executive Vice President--Product Development, a position he has held since the
Company's formation in April 1987. Mr. Humenansky is also a director of
Platinum Entertainment, Inc.
Mr. Cullinane joined the Company in March 1988 as Senior Vice President and
Chief Financial Officer, and was named Executive Vice President in March 1995.
He has also served as the Company's Treasurer since April 1989 and served as
its Secretary from April 1989 until October 1995. Mr. Cullinane is also a
director of Vasco Data Security International, Inc., Made2Manage Systems, Inc.
and Platinum Entertainment, Inc.
Mr. Cowie has been a General Partner of Frontenac Company, a Chicago-based
venture capital firm, since February 1989. Mr. Cowie is also a director of 3Com
Corporation.
Mr. Devick is currently the President, Chief Executive Officer and Chairman
of the Board of Directors of Platinum Entertainment, Inc., which he co-founded
in 1992. He is also a director of Blue Rhino Corporation and several private
companies.
Mr. Frigo is the Chairman of the Board of Lucini Italia Company, a consumer
products company. He was the former owner and Chairman of M.B. Walton, a
consumer products company, until its sale in January 1998. Prior to M. B.
Walton, Mr. Frigo owned a number of businesses in the industrial diamond
technology field. In addition, he is involved in initiating several
entrepreneurial new ventures. He is also a director of the Levy Organization,
Maxrad, Precision Extrusions, LaRabida Children's Hospital and the Landmark
Preservation Council of Illinois.
1
<PAGE>
Mr. Fulgoni is the Chief Executive Officer of Lancaster Marketing Group,
LLC, which provides target marketing services to the consumer packaged goods
("CPG") industry. He served as Chief Executive Officer of Information
Resources, Inc. ("IRI"), which provides a variety of information services and
computer decision support services (primarily to the CPG industry) from 1986
to 1998. From 1991 to April 1995, Mr. Fulgoni also served as Chairman of IRI,
and from 1981 to 1989 he was its President. Mr. Fulgoni is currently a
Director of IRI. Mr. Fulgoni is also a director of YesMail.com.
Mr. Slowey has served as Executive Vice President--Sales since joining the
Company in March 1988.
Mr. Tatro joined the Company in October 1987 as Director of Education and
was appointed Senior Vice President--Field Support and Affiliates in January
1990, a position he held until March 1995, when he was named Executive Vice
President--International Operations.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16 of the Securities Exchange Act of 1934, as amended (the "Act"),
requires the Company's officers (as defined under Section 16) and directors
and persons who own greater than 10% of a registered class of the Company's
equity securities to file reports of ownership and changes in ownership with
the Securities and Exchange Commission (the "Commission"). Based solely on a
review of the forms it has received and on written representations from
certain reporting persons that no such forms were required for them, the
Company believes that, except as discussed below, during 1998 all Section 16
filing requirements applicable to its officers, directors and greater than 10%
beneficial owners were complied with by such persons.
Mr. Humenansky inadvertently failed to file timely a Form 4 for a
transaction occurring in July 1998. The Form 4 was filed by Mr. Humenansky in
December 1998. Mr. Slowey inadvertently failed to file timely a Form 4 for a
transaction occurring in July 1998. The Form 4 was filed by Mr. Slowey in
December 1998. Mr. Devick inadvertently failed to file timely a Form 4 for a
transaction occurring in May 1998. The transaction was reported on Mr.
Devick's 1998 Form 5.
2
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The following table provides information concerning the annual and long-term
compensation for services in all capacities to the Company for the years ended
December 31, 1998, 1997 and 1996 of those persons who were at December 31, 1998
(i) the Chief Executive Officer and (ii) the four other executive officers of
the Company (collectively, with the Chief Executive Officer, the "Named
Officers").
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
--------------------------------- Awards
Other Securities
Name and Principal Annual Underlying All Other
Position Year Salary ($) Bonus ($) Compensation Options (#) Compensation ($)
------------------ ---- ---------- --------- ------------ ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
Andrew J. Filipowski, 1998 $888,000 $666,000 $62,911(1) 800,000 $299,294(2)
President, Chief 1997 772,000 772,000 -- 500,000 264,590
Executive
Officer and Chairman of 1996 702,000 -- -- -- 222,010
the Board
Paul L. Humenansky, 1998 584,000 350,400 -- 491,250 100,123(3)
Chief Operations 1997 508,000 406,400 -- 300,000 108,001
Officer and Executive 1996 462,000 -- -- -- 90,904
Vice President--Product
Development
Michael P. Cullinane, 1998 564,000 338,400 -- 418,750 85,192(4)
Executive Vice 1997 490,000 392,000 -- 250,000 97,150
President, Chief 1996 445,500 -- -- -- 83,036
Financial Officer and
Treasurer
Thomas A. Slowey, 1998 345,000 129,375 -- 218,750 28,460(5)
Executive Vice 1997 300,000 150,000 -- 125,000 22,313
President--Sales 1996 273,000 -- -- -- 22,171
Paul A. Tatro, 1998 345,000 129,375 -- 182,500 24,904(6)
Executive Vice 1997 300,000 150,000 -- 100,000 21,192
President
--International 1996 273,000 -- -- -- 21,923
Operations
</TABLE>
- --------
(1) Represents perquisites received by the Named Officer, including $50,600 in
personal use of the Company's corporate jet.
(2) Includes $4,800 in company matching contributions pursuant to the Company's
401(k) Savings Plan (the "Savings Plan"), $167,959 in premiums paid by the
Company for term life and disability insurance, $17,662 in premiums paid by
the Company for the term portion of split-dollar life insurance, and
$108,873 representing the dollar value of the benefit to the Named Officer
of the remainder of the premiums paid by the Company for the split-dollar
life insurance.
(3) Includes $4,800 in Company matching contributions pursuant to the Savings
Plan, $7,592 in Company matching contributions pursuant to the Company's
Deferred Compensation Plan, $14, 719 in premiums paid by the Company for
term life and disability insurance, $4,612 in premiums paid by the Company
for the term portion of split-dollar life insurance, and $68,400
representing the dollar value of the benefit to Named Officer of the
remainder of the premiums paid by the Company for the split-dollar life
insurance.
(4) Includes $4,800 in Company matching contributions pursuant to the Savings
Plan, $20,315 in premiums paid by the Company for term life and disability
insurance, $5,793 in premiums paid by the Company for the term portion of
split-dollar life insurance, and $54,284 representing the dollar value of
the benefit to the Named Officer of the remainder of the premiums paid by
the Company for the split-dollar life insurance.
(5) Includes $4,800 in Company matching contributions pursuant to the Savings
Plan, $4,485 in Company matching contributions pursuant to the Company's
Deferred Compensation Plan, $1,042 in premiums paid
3
<PAGE>
by the Company for the term portion of split-dollar life insurance, and
$18,133 representing the dollar value of the benefit to the Named Officer of
the remainder of the premiums paid by the Company for the split-dollar life
insurance.
(6) Includes $4,800 in Company matching contributions pursuant to the Savings
Plan, $2,185 in Company matching contributions pursuant to the Company's
Deferred Compensation Plan, $1,204 in premiums paid by the Company for the
term portion of split-dollar life insurance, and $16,715 representing the
dollar value of the benefit to the Named Officer of the remainder of the
premiums paid by the Company for the split-dollar life insurance.
Option Grants in 1998
The following table provides information on grants of stock options during
fiscal 1998 to the Named Officers. No stock appreciation rights were granted to
the Named Officers during fiscal 1998.
Option Grants In 1998
<TABLE>
<CAPTION>
Potential Realizable
Individual Value at Assumed
Number of Grants Annual Rates of Stock
Securities Percent of Total Exercise Price Appreciation for
Underlying Options Granted or Base Option Term(1)
Options to Employees in Price Expiration ----------------------
Name Granted (#)(2) Fiscal Year(3) ($/Sh) Date 5% ($) 10% ($)
- ---- -------------- ---------------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Andrew J. Filipowski.... 600,000 6.4% $23.6875 06/18/08 $8,938,165 $22,651,065
75,000 0.8% 13.9375 10/19/08 657,391 1,665,959
125,000 1.3% 21.1875 12/09/08 1,665,588 4,220,927
Paul L. Humenansky...... 360,000 3.8% 23.6875 06/18/08 5,362,899 13,590,639
56,250 0.6% 13.9375 10/19/08 493,044 1,249,469
75,000 0.8% 21.1875 12/09/08 999,353 2,532,556
Michael P. Cullinane.... 300,000 3.2% 23.6875 06/18/08 4,469,082 11,325,532
56,250 0.6% 13.9375 10/19/08 493,044 1,249,469
62,500 0.7% 21.1875 12/09/08 832,794 2,110,464
Thomas A. Slowey........ 150,000 1.6% 23.6875 06/18/08 2,234,541 5,662,766
37,500 0.4% 13.9375 10/19/08 328,696 832,979
31,250 0.3% 21.1875 12/09/08 416,397 1,055,232
Paul A. Tatro........... 120,000 1.3% 23.6875 06/18/08 1,787,633 4,530,213
37,500 0.4% 13.9375 10/19/08 328,696 832,979
25,000 0.3% 21.1875 12/09/08 333,118 844,185
</TABLE>
- --------
(1) Potential realizable value is presented net of the option exercise price
but before any federal or state income taxes associated with exercise.
These amounts are based upon assumed rates of appreciation prescribed by
the Commission. Actual gains will be dependent on the future performance of
the Company's Common Stock and the option holder's continued employment
throughout the vesting period. The amounts reflected in the table may not
necessarily be achieved.
(2) Options granted are both non-qualified and incentive stock options. Subject
to certain restrictions, these options become exercisable in four equal
annual installments, beginning on the first anniversary of the date of
grant.
(3) The percentages shown do not reflect options granted in 1998 by companies
acquired by the Company.
4
<PAGE>
Aggregated Option Exercises in 1998 and Year-End 1998 Option Values
The following table provides information on the Named Officers' option
exercises in 1998 and unexercised options at December 31, 1998.
Aggregated Option Exercises in 1998 and Year-End 1998 Option Values
<TABLE>
<CAPTION>
Number of
Securities Underlying
Shares Unexercised Value of Unexercised
Acquired on Options at In-The-Money Options at
Exercise Value Year-End 1998 (#) Year-End 1998 ($)(1)
(#) Realized ------------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Andrew J. Filipowski.... 385,000 $8,355,605 2,057,502 1,131,250 $13,452,176 $1,754,297
Paul L. Humenansky...... 179,625 3,452,289 731,937 689,688 3,080,650 1,098,538
Michael P. Cullinane.... 0 0 769,062 567,188 5,190,384 939,163
Thomas A. Slowey........ 15,000 443,712 337,875 296,875 2,172,302 541,602
Paul A. Tatro........... 0 0 279,657 241,875 1,451,468 437,305
</TABLE>
- --------
(1) The value per option is calculated by subtracting the exercise price from
the closing price of the Company's Common Stock on the Nasdaq National
Market on December 31, 1998, which was $19.125.
Director Compensation
All non-employee directors of the Company are paid an annual fee consisting
of $10,000 and approximately 7,500 shares of the Company's Common Stock. In
addition, each non-employee director participates in the Company's Amended and
Restated 1993 Directors' Stock Option Plan (the "Directors' Plan"). Pursuant to
the Directors' Plan, each non-employee director is granted, on the date of each
annual meeting after which such director continues to serve on the Board of
Directors, an option to purchase 10,000 shares of Common Stock at the fair
market value of the Common Stock on such date. The Company provides no
retirement benefits to non-employee directors. Directors who are also employees
of the Company receive no additional compensation from the Company for services
rendered in their capacity as directors.
Employment Agreements
Effective March 1, 1991, the Company entered into employment agreements with
Messrs. Filipowski, Humenansky and Cullinane. These agreements were amended and
restated as of March 1, 1999. Mr. Filipowski's employment agreement provides
for an initial base salary of $972,000 plus bonus compensation. Mr.
Humenansky's employment agreement provides for an initial base salary of
$642,000 plus bonus compensation. Mr. Cullinane's employment agreement provides
for an initial base salary of $620,000 plus bonus compensation. Each of the
employment agreements provides that the base salary is subject to review and
cannot be reduced without the consent of the executive. The agreements provide
that all bonus arrangements for Messrs. Filipowski, Humenansky and Cullinane
are established by the Compensation Committee of the Company's Board of
Directors. Each of the employment agreements also provide for continuation of
salary, bonuses and fringe benefits during the "Payout Period" (as defined
below) following the executive's termination of employment with the Company for
any reason other than "Good Cause," as defined in such agreement, or if the
termination occurs within a certain time period before or after a "Change in
Control" (as defined below) of the Company, and for continued medical, dental,
disability and life insurance coverage until age 65 following the executive's
termination of employment with the Company for any reason. In the case of
medical and dental coverage, the coverage is extended to each executive's
spouse and to the time such individuals become entitled to coverage under
Medicare. The Payout Period under each of the employment agreements is three
years from the date of termination (18 months in the case of a voluntary
termination by the executive other than in the case of constructive
termination), unless the termination occurs during the two-year period
beginning 120 days prior to a "Change in Control" and ending two years after
the "Change in Control," in which case, the Payout Period is five years. Under
these agreements, a "Change in Control" of the Company includes (a) certain
reorganizations, consolidations or mergers of the Company, (b) certain
5
<PAGE>
transfers of all or substantially all of the assets of the Company, (c) the
approval by the Company's stockholders of a plan of liquidation or dissolution,
(d) a change in the Company's Board of Directors such that a majority of the
members of the Company Board are not "continuing" directors, or (e) a person's
acquiring 20% or more of (i) the outstanding shares of Common Stock or (ii) the
combined voting power of the Company's then outstanding securities, with
certain exceptions.
Severance Pay Agreements
As of August 31, 1998, the Company entered into severance pay agreements
with Messrs. Slowey and Tatro. Each agreement provides for payment to the
executive of severance pay and continuation of his fringe benefits for the
"Payout Period" (as defined below) if his employment is terminated by the
Company, other than for "Good Cause" (as defined in the agreements), or is
terminated by the executive for "Good Reason" (as defined in the agreements)
during a specified time period before or after a "Change in Control" (as
defined below) of the Company. The severance pay is based upon the executive's
base salary, incentive compensation and bonuses for periods prior to employment
termination. The Payout Period is 36 months if the termination occurs during
the period beginning 60 days prior to the Change in Control and ending one year
after the Change in Control and is 24 months if the termination occurs during
the period beginning after the initial period and ending two years after the
Change in Control. Under these agreements, a "Change in Control" of the Company
includes substantially the same events that constitute a Change in Control for
purposes of the employment agreements of Messrs. Filipowski, Humenansky and
Cullinane.
Consulting and Non-Compete Agreements
On March 29, 1999, in connection with the execution of the merger agreement
(the "Merger Agreement") among the Company, Computer Associates International,
Inc. ("CA") and HardMetal, Inc., a wholly-owned subsidiary of CA ("HardMetal"),
the Company entered into consulting and non-compete agreements with Messrs.
Filipowski, Humenansky and Cullinane (each, a "Consultant"). Pursuant to these
consulting agreements, each Consultant has agreed to provide consulting
services to the Company for a two-year period (the "Consulting Period")
commencing on the consummation of the merger with HardMetal (the "Merger"). As
compensation, the Company has agreed to pay consulting fees to Mr. Filipowski
at the rate of $1,000,000 per annum and to each of Messrs. Humenansky and
Cullinane at the rate of $500,000 per annum. The Consulting Agreements only
become effective upon consummation of the Merger. If the Merger Agreement
terminates, each consulting agreement also terminates. Each of the consulting
agreements provides that if the Company terminates the Consulting Period
without "Cause" (as defined in the agreements) or the Consultant dies or
becomes disabled, the Consultant will be entitled to the continued payment of
all consulting fees. If either (a) the Company terminates the Consulting Period
for Cause or (b) the Consultant terminates the Consulting Period, the
Consultant will receive consulting fees only through the date of termination.
In the consulting agreements, each of Messrs. Humenansky and Cullinane has
agreed, at the request of the Company, for a period (the "Transition Employment
Period") of up to six months from the effective date of the Merger but in no
event later than September 30, 1999, to remain as an employee to provide
transition services in capacity substantially similarly to his current
employment with the Company, with continuation of compensation at the same
basis as his current compensation. The consulting agreements also contain non-
competition provisions which prohibit, for a period beginning on the effective
date of the Merger and ending, in the case of Mr. Filipowski, on the eighth
anniversary of the effective date, and in the case of each of Messrs.
Humenansky and Cullinane, on the fifth anniversary of the later of the
effective date and the end of the Transition Employment Period, from engaging
in activities competitive with those of the Company. As compensation for each
Consultant entering into a non-compete agreement, the Company has agreed to pay
$22,000,000 to Mr. Filipowski and $10,500,000 to each of Messrs. Humenansky and
Cullinane. The Consultants have also agreed to be liable for any loss or damage
in excess of $1,500,000 resulting from the Company's failure to observe the
conduct of business covenants set forth in Section 5.1 of the Merger Agreement.
Mr. Filipowski, Mr. Humenansky and Mr. Cullinane will be liable for 49%, 22%
and 22%, respectively, of such loss or damage, and their maximum aggregate
liability for such loss or damage will be the
6
<PAGE>
sum of the total payments under their respective consulting agreement and the
value of the options to purchase shares of the Company's Common Stock issued to
each Consultant in 1999 (options to purchase 675,000 shares for Mr. Filipowski,
400,000 shares for Mr. Humenansky and 350,000 shares for Mr. Cullinane). The
consulting agreements also provide that the options issued in 1999 to the
Consultants are not exercisable until the closing of the tender offer by
HardMetal and provide for forfeiture of certain options based on the length of
time required to resolve all federal anti-trust issues.
Compensation Committee Interlocks and Insider Participation
Messrs. Cowie, Devick and Frigo were the members of the Company's
Compensation Committee during 1998. Mr. Filipowski is an executive officer of
Platinum Venture Partners, Inc. ("PVP"), and is the sole director of, and makes
compensation decisions for, PVP. Mr. Devick is an executive officer of Platinum
Entertainment, Inc. ("PEI"), and Messrs. Filipowski, Humenansky and Cullinane,
all of whom are executive officers of the Company, are directors of PEI.
Messrs. Filipowski and Cullinane are also members of the Compensation Committee
of PEI.
The Company acquired Mastering, Inc. ("Mastering") pursuant to an Agreement
and Plan of Merger dated as of February 18, 1998 (the "Mastering Merger
Agreement"). Messrs. Filipowski and Cowie were both Directors of Mastering. Mr.
Filipowski held options to purchase 34,800 shares of common stock of Mastering
(which were granted to him in his capacity as a director of Mastering) and,
through Platinum Venture Partners I L.P. and Platinum Venture Partners II L.P.
(together referred to as the "Platinum Ventures"), indirectly held
approximately 22,000 shares of common stock of Mastering. Mr. Cowie held
options to purchase 34,800 shares of common stock of Mastering (granted to him
in his capacity as a director of Mastering). Neither Mr. Filipowski nor Mr.
Cowie participated in the original deliberations or vote of the Board of
Directors or the board of directors of Mastering with respect to the Mastering
Merger Agreement. The Platinum Ventures owned a total of approximately 335,000
shares of common stock of Mastering. Mr. Filipowski is the President, Chief
Executive Officer and a stockholder of PVP, the general partner of each of the
Platinum Ventures, and a limited partner of each of the Platinum Ventures.
Additionally, each of the other executive officers and directors of the Company
indirectly owned shares of common stock of Mastering (collectively totalling
more than 20,000 shares).
On April 23, 1998, the Company entered into a consulting agreement (the
"Initial Agreement") with Platinum Entertainment, Inc. ("PTE"), under which the
Company performed consulting services for PTE on an hourly billable basis and
for which the Company issued invoices in the amount of $665,743. In addition,
the Company performed website development services for PTE during 1998 on an
hourly billable basis under an oral agreement between the companies, for which
the Company issued additional invoices in the amount of $243,323. In exchange
for all of these services, on November 20, 1998 and April 14, 1999 PTE issued
to the Company a total of 128,438 shares of PTE common stock. On April 14,
1999, the Company and PTE extended the term of the Initial Agreement (the
"Extension") for a period of thirty days, which term will currently expire on
April 30, 1999. The parties anticipate that if the project has not been
concluded, an additional 30 day extension will be executed. In exchange for the
services to be performed under the Extension, PTE will issue to the Company
additional shares of PTE's common stock, the market value of which on the date
of issuance will equal the dollar amount of invoices issued by the Company to
PTE for the services rendered. To the extent the net proceeds to the Company
upon disposition of any of shares issued to the Company by PTE under the
Initial Agreement or the Extension (the "Liquidation Value") are less than the
value of such shares on the date of issuance (the "Initial Value"), PTE will
issue such additional shares to the Company as necessary to make up the
difference between the Initial Value and the Liquidation Value. To the extent
the Liquidation Value exceeds the Initial Value (the "Excess Value"), the
Company will retain 10% of such Excess Value and will apply the remaining
Excess Value as a credit toward future invoices issued pursuant to the
Extension. Mr. Devick is the President, Chief Executive Officer and Chairman of
the Board of PTE, and Messrs. Filipowski, Cullinane and Humenansky serve as
directors of PTE.
7
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 31, 1999, unless otherwise
indicated below, certain information with respect to the beneficial ownership
of the Common Stock by (i) each person known by the Company to own beneficially
more than 5% of the outstanding shares of the Common Stock, (ii) each director
of the Company, (iii) each of the Named Officers and (iv) all executive
officers and directors of the Company as a group.
<TABLE>
<CAPTION>
Amount and
Nature of Percent
Beneficial of
Name and Address Ownership(1) Class
- ---------------- ------------ -------
<S> <C> <C>
HardMetal, Inc. (2)...................................... 11,353,680 10.4%
J & W Seligman (3)....................................... 6,449,344 6.4
T. Rowe Price Associates, Inc. (4)....................... 5,508,073 5.4
Andrew J. Filipowski (5)................................. 4,652,068 4.5
Michael P. Cullinane (6)................................. 856,773 *
Paul L. Humenansky (7)................................... 766,926 *
Thomas A. Slowey (8)..................................... 347,890 *
Paul A. Tatro (9)........................................ 320,657 *
Steven D. Devick (10).................................... 107,017 *
Arthur P. Frigo (11)..................................... 93,500 *
James E. Cowie (12)...................................... 55,208 *
Gian Fulgoni (13)........................................ 25,966 *
All Executive Officers and Directors as a Group (9
persons) (14)........................................... 7,226,005 6.8
</TABLE>
- --------
* Less than one percent
(1) Unless otherwise indicated below, the persons in the above table have sole
voting and investment power with respect to all shares shown as
beneficially owned by them.
(2) As reported on a Schedule 13D filed with the Commission on April 2, 1999
(the "HardMetal 13D") by HardMetal, Inc. ("HardMetal") and Computer
Associates International, Inc. ("Computer Associates"). According to the
HardMetal 13D, each of HardMetal (a wholly-owned subsidiary of Computer
Associates) and Computer Associates has sole voting power and sole
dispositive power with respect to 1,080,000 shares and has shared voting
power and shared dispositive power with respect to 10,273,680 shares. The
10,273,680 shares over which HardMetal and Computer Associates claim to
have shared voting and dispositive power are outstanding shares, and
7,644,125 shares issuable upon exercise of options (including options
which are not currently exercisable), held by Messrs. Filipowski,
Cullinane and Humenansky. These shares are subject to a Stockholder Option
Agreement dated as of March 29, 1999 (the "Option Agreement"), pursuant to
which Messrs. Filipowski, Cullinane and Humenansky have granted HardMetal
an irrevocable option, subject to certain conditions, to purchase such
shares or to cause them to be tendered pursuant to the HardMetal tender
offer. The address of HardMetal and Computer Associates is One Computer
Associates Plaza, Islanda, New York 11788-70001.
(3) As reported on Schedule 13G filed with the Commission on February 9, 1999
(the "Seligman 13G") jointly by J&W Seligman Co. Incorporated ("Seligman")
and William C. Morris ("Morris"). According to the Seligman 13G, Seligman
and Morris each have shared voting power with respect to 5,981,800 shares
and shared dispositive power with respect to all 6,449,344 shares.
(4) As reported on a Schedule 13G/A filed with the Commission on February 12,
1999 (the "Price 13G") by T. Rowe Price Associates, Inc. ("Price
Associates"). According to the Price 13G, Price Associates has sole voting
power with respect to 378,300 shares and sole dispositive power with
respect to all 5,508,073 shares. The address of Price Associates is 100 E.
Pratt Street, Baltimore, Maryland 21202.
8
<PAGE>
(5) Includes (a) 2,057,502 shares which may be acquired pursuant to the
exercise of stock options held by Mr. Filipowski within 60 days of March
31, 1999, (b) 189,000 shares held by a foundation established by Mr.
Filipowski and (c) an aggregate of 547,994 shares held by the Platinum
Ventures Partners I, L.P. and Platinum Venture Partners II, L.P. Mr.
Filipowski disclaims beneficial ownership of the shares held by the
foundation. Mr. Filipowski disclaims beneficial ownership of the shares
held by the Platinum Ventures, except to the extent of his pecuniary
interest. The shares owned by Mr. Filipowski are subject to the Option
Agreement and to a "put/call collar" arrangement with a brokerage firm.
The address of Mr. Filipowski is c/o PLATINUM technology International,
inc., 1815 South Meyers Road, Oakbrook Terrace, Illinois 60181.
(6) Includes (a) 769,062 shares which may be acquired pursuant to the exercise
of stock options held by Mr. Cullinane within 60 days of March 31, 1999
and (b) 6,211 shares allocated to his account under the Company's Stock
Purchase Plan. The shares owned by Mr. Cullinane are subject to the Option
Agreement.
(7) Includes (a) 731,937 shares which may be acquired pursuant to the exercise
of stock options held by Mr. Humenansky within 60 days of March 31, 1999
and (b) 5,364 shares allocated to his account under the Company's Stock
Purchase Plan. The shares owned by Mr. Humenansky are subject to the
Option Agreement.
(8) Includes (a) 344,125 shares which may be acquired pursuant to the exercise
of stock options held by Mr. Slowey within 60 days of March 31, 1999 and
(b) 3,765 shares allocated to his account under the Company's Stock
Purchase Plan.
(9) Includes (a) 279,657 shares which may be acquired pursuant to the exercise
of stock options held by Mr. Tatro within 60 days of March 31, 1999, and
(b) 41,000 shares held as co-trustee, with his wife, of trusts for their
benefit.
(10) Includes 8,633 shares which may be acquired pursuant to the exercise of
stock options held by Mr. Devick within 60 days of March 31, 1999.
(11) Includes 9,900 shares which may be acquired pursuant to the exercise of
stock options held by Mr. Frigo within 60 days of March 31, 1999.
(12) Includes 32,218 shares which may be acquired pursuant to the exercise of
stock options held by Mr. Cowie within 60 days of March 31, 1999.
(13) Represents shares which may be acquired pursuant to the exercise of stock
options held by Mr. Fulgoni within 60 days of March 31, 1999.
(14) Includes 4,259,000 shares which may be acquired pursuant to the exercise
of stock options within 60 days of March 31, 1999.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
See the discussion above under "ITEM 11. EXECUTIVE COMPENSATION--
Compensation Committee Interlocks and Insider Participation."
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this amendment to be
signed on its behalf by the undersigned, thereunto duly authorized, on the 30th
day of April, 1999.
Platinum technology International,
inc.
/s/ Michael P. Cullinane
By: _________________________________
Michael P. Cullinane
Executive Vice President, Chief
Financial Officer and Treasurer
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