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Registration No. ____________
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NETWORK GENERAL CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 77-0115204
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(State or other jurisdiction (I.R.S. employer identification no.)
of incorporation or organization)
4200 BOHANNON DRIVE
MENLO PARK, CALIFORNIA 94025
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(Address of principal executive offices) (Zip code)
NETWORK GENERAL CORPORATION
1989 STOCK OPTION PLAN
1989 OUTSIDE DIRECTORS STOCK OPTION PLAN
1989 EMPLOYEE STOCK PURCHASE PLAN
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(Full title of the plan)
JAMES T. RICHARDSON
SENIOR VICE PRESIDENT, CORPORATE OPERATIONS
AND CHIEF FINANCIAL OFFICER
NETWORK GENERAL CORPORATION
4200 BOHANNON DRIVE
MENLO PARK, CALIFORNIA 94025
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(Name and address of agent for service)
Telephone number, including area code, of agent for service: 415/473-2000
This registration statement shall hereafter become effective in accordance with
Rule 462 promulgated under the Securities Act of 1933, as amended.
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- -------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price per offering registration
registered registered share(1) price(1) fee
- -------------------------------------------------------------------------------
1989 STOCK OPTION PLAN
Common Stock 2,000,000 $15.8125 $31,625,000 $10,906
Par Value $0.01
1989 OUTSIDE DIRECTORS STOCK OPTION PLAN
Common Stock 100,000 $15.8125 $1,581,250 $546
Par Value $0.01
1989 EMPLOYEE STOCK PURCHASE PLAN
Common Stock 100,000 $13.4406 $1,344,060 $464
Par Value $0.01
TOTAL 2,200,000 n/a $34,550,310 $11,916
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
Network General Corporation (the "Company") hereby incorporates by
reference in this registration statement the following documents:
(a) The Company's latest annual report on Form 10-K filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange
- ----------------------
(1) Estimated pursuant to Rule 457 solely for purposes of calculating the
registration fee. The Network General Corporation 1989 Employee Stock
Purchase Plan establishes a purchase price equal to 85% of the fair market
value of the Company's Common Stock and, therefore, the price for purchase
rights under this plan is based upon 85% of the average of the high and low
prices of the Common Stock on September 10, 1996, as reported on the National
Association of Securities Dealers Automated Quotations System. As to the
remaining shares, the price is based upon the average of the high and low
prices of the Common Stock on September 10, 1996, as reported on the National
Association of Securities Dealers Automated Quotations System.
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Act"), containing audited financial statements for the Company's latest
fiscal year ended March 31, 1996, as filed June 28, 1996.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the annual report
referred to in (a) above.
(c) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form S-1 (No. 33-36134, effective August
2, 1989) filed under the Securities Act of 1933, as amended (the "Securities
Act"), including any amendment or report filed for the purpose of updating
such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment to this registration statement which indicates that
all securities offered hereby have been sold or which deregisters all
securities remaining unsold, shall be deemed to be incorporated by reference
in this registration statement and to be a part hereof from the date of
filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
The class of securities offered is registered under Section 12 of the
Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
LEGAL OPINION. The validity of the shares of Common Stock to be offered
hereunder has been passed upon for the Company by Gray Cary Ware &
Freidenrich, A Professional Corporation. Mr. Greg M. Gallo, an attorney and
a member with Gray Cary Ware & Freidenrich, A Professional Corporation ("Gray
Cary"), since 1973, has been a director of the Company since April 1989. As
of August 1996 certain attorneys of Gray Cary owned 82,000 shares of the
Common Stock of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Delaware law authorizes corporations to eliminate the personal liability
of directors to corporations and their stockholders for monetary damages for
breach or alleged breach of the directors' fiduciary "duty of care." While
the relevant statute does not change directors' duty of care, it enables
corporations to limit available relief to equitable remedies such as
injunction or rescission. The statute has no effect on directors' duty of
loyalty, acts or omissions not in good faith and involving intentional
misconduct or knowing violations of law, illegal payment of dividends and
approval of any transactions from which a director derives an improper
personal benefit.
The Company has adopted provisions in its Certificate of Incorporation
which eliminate the personal liability of its directors to the Company and
its stockholders for monetary damages for breach or alleged breach of their
duty of care. The By-laws of the Company provide for indemnification of its
directors, officers, employees and agents to the full extent permitted by the
General Corporation Law of the State of Delaware, the Company's state of
incorporation, including those circumstances in which indemnification would
otherwise be discretionary under Delaware law. In addition, the Company has
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entered into separate indemnification agreements with its directors, officers
and certain employees which require the Company, among other things, to
indemnify them against certain liabilities which may arise by reason of their
status or service (other than liabilities arising from willful misconduct of
a culpable nature) and to obtain directors' and officers' insurance, if
available on reasonable terms. Section 145 of the General Corporation Law of
the State of Delaware provides for indemnification in terms sufficiently
broad to indemnify such individuals, under certain circumstances, for
liabilities (including reimbursement of expenses incurred) arising under the
Securities Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Inapplicable.
ITEM 8. EXHIBITS
See Exhibit Index.
ITEM 9. UNDERTAKINGS
(a) RULE 415 OFFERING
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
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(l)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and 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 Section 15(d) of the Exchange Act 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.
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(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.
(b) FILING INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE
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 Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement 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.
(h) REQUEST FOR ACCELERATION OF EFFECTIVE DATE OR FILING OF REGISTRATION
STATEMENT ON FORM S-8
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 matter 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.
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Menlo Park, State of California, on
September 17, 1996.
Network General Corporation
By: /s/ James T. Richardson
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James T. Richardson,
Senior Vice President,
Corporate Operations and
Chief Financial Officer
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POWER OF ATTORNEY
The officers and directors of Network General Corporation whose
signatures appear below, hereby constitute and appoint Leslie G. Denend and
James T. Richardson, and each of them, their true and lawful attorneys and
agents, with full power of substitution, each with power to act alone, to
sign and execute on behalf of the undersigned any amendment or amendments to
this registration statement on Form S-8, and do ratify and confirm all that
each of said attorney and agent, or their or his substitutes, shall do or
cause to be done by virtue hereof. Pursuant to the requirements of the
Securities Act, this registration statement has been signed by the following
in the capacities indicated on September 17, 1996.
Signature Title
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/s/ Leslie G. Denend
- ------------------------- President, Chief Executive Officer
Leslie G. Denend and Director (Principal Executive Officer)
/s/ James T. Richardson Senior Vice President, Corporate Operations and
- ------------------------- Chief Financial Officer
James T. Richardson (Principal Financial/Accounting Officer)
/s/ Charles J. Abbe
- ------------------------- Director
Charles J. Abbe
/s/ Douglas C. Chance
- ------------------------- Director
Douglas C. Chance
/s/ Howard Frank
- ------------------------- Director
Howard Frank
/s/ Gregory M. Gallo
- ------------------------- Director
Gregory M. Gallo
/s/ Laurence R. Hootnick
- ------------------------- Director
Laurence R. Hootnick
/s/ Janet L. Hyland
- ------------------------- Director
Janet L. Hyland
/s/ Harry J. Saal
- ------------------------- Director
Harry J. Saal
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EXHIBIT INDEX
4.1. [Third Restated Certificate of Incorporation of the Company]
4.2. [Amended and Restated By-Laws of the Company are incorporated
by reference to Exhibit 3.3 to the Company's Report on Form 10-Q
for the quarter ending June 30, 1994 (No. 0-17431, filed August 6,
1994)]
4.3. [Stockholders Rights Plan of the Company is incorporated by reference
to the Company's Current Report on Form 8-K (No. 0-17431, filed
July 7, 1992)]
5 Opinion re legality
23.1 Consent of Counsel (included in Exhibit 5)
23.2 Consent of Arthur Andersen LLP
24 Power of Attorney (included in signature pages to this registration
statement)
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EXHIBIT 4.1
THIRD
RESTATED CERTIFICATE OF INCORPORATION
OF
NETWORK GENERAL CORPORATION
A Delaware corporation
Network General Corporation, a corporation organized and existing under
the General Corporation Law of the State of Delaware, certifies that:
1. The name of the corporation is Network General Corporation (the
"Corporation"). The Corporation was originally incorporated under the same
name, and the Corporation's original Certificate of Incorporation was filed
with the Secretary of State of the State of Delaware on July 31, 1987.
2. At a meeting of the Board of Directors of the Corporation,
resolutions were duly adopted setting forth the proposed amendment and
restatement of the Corporation's Certificate of Incorporation, declaring such
amendment and restatement to be advisable, and calling for a vote of the
Corporation's stockholders to approve such amendment and restatement. The
resolution setting forth the proposed amendment and restatement was as
follows:
RESOLVED, that the Corporation's Certificate of Incorporation be amended
and restated so that, as amended and restated, the Certificate
shall read in its entirety as follows:
FIRST: The name of the Corporation is Network General Corporation.
SECOND: The name and address in the State of Delaware of the
Corporation's registered office in the State of Delaware is Corporation
Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle and The Corporation Trust Company is the Corporation's
registered agent at the address of its registered office.
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THIRD: The purpose of the Corporation is to engage in any lawful
act or activity for which a Corporation may be organized under the
General Corporation Law of Delaware.
FOURTH: This Corporation is authorized to issue two classes of
stock to be designated, respectively, Preferred Stock and Common Stock.
The total number of shares of Preferred Stock this Corporation shall
have authority to issue is two million (2,000,000), par value one cent
($.01) per share, and the total number of shares of Common Stock this
Corporation shall have authority to issue is one hundred million
(1000,000,000), par value one cent ($.01) per share.
The Board of Directors is authorized, subject to limitations
prescribed by law and the provisions of this Article FOURTH, to provide
for the issuance of the shares of Preferred Stock in series, and by
filing a certificate pursuant to the applicable law of the State of
Delaware, to establish from time to time the number of shares to be
included in each such series, and to fix the designation, powers,
preferences and rights of the shares of each such series and the
qualifications, limitations or restrictions thereon.
Pursuant to the foregoing provision, the Board of Directors has
created one series of Preferred Stock with the following rights, powers,
preferences, qualifications, limitations and restrictions:
Section 1. DESIGNATION AND AMOUNT. The shares of such series
shall be designated as "Series A Preferred Stock" (the "Series A
Preferred Stock"), $0.01 par value per share, and the number of shares
constituting such series shall be 1,000,000.
Section 2. DIVIDENDS AND DISTRIBUTIONS.
(A) The dividend rate on the shares of Series A Preferred Stock
shall be for each quarterly dividend (hereinafter referred to as a
"quarterly dividend period"), which quarterly dividend periods shall
commence on April 1, July 1, October 1 and January 1, in each year (each
such date being referred to herein as a "Quarterly Dividend Payment
Date") (or in the case of original issuance, from the date of original
issuance) and shall end on and include the day next preceding the first
date of the next quarterly dividend period, at a rate per quarterly
dividend period (rounded to the nearest cent) equal to the greater of
(a) $225.00 or (b) subject to the provisions for adjustment hereinafter
set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in
cash, based upon the fair market value at the time the non-cash dividend
or other distribution is declared as determined in good faith by the
Board of Directors) of all non-cash dividends or other distributions
other than a dividend payable in shares of Common Stock or a subdivision
of the outstanding shares of Common Stock (by reclassification or
otherwise), declared (but not withdrawn) on the Common Stock, par value
$.01 per share, of the Corporation (the "Common Stock") during the
immediately preceding quarterly dividend period, or, with respect to the
first quarterly dividend period, since the first issuance of any share
or fraction of a share of Series A Preferred Stock. In the event this
Corporation shall at any time after July 14, 1992 (the
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"Rights Declaration Date") (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the amount to which holders of
shares of Series A Preferred Stock were entitled immediately prior to
such event under clause (b) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(B) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of
Series A Preferred Stock, unless the date of issue of such shares is
prior to the record date for the first Quarterly Dividend Payment Date,
in which case dividends on such shares shall begin to accrue from the
date of issue of such shares, or unless the date of issue is a Quarterly
Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled
to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment Date.
Accrued but unpaid dividends shall not bear interest. Dividends paid on
the shares of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such shares
shall be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a record
date for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than 45 days prior to the
date fixed for the payment thereof.
Section 3. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof
to 100 votes on all matters submitted to a vote of the stockholders of
the Corporation. In the event the Corporation shall at any time after
the Rights Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the number of votes per share
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided in this Certificate of
Incorporation
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or by law, the holders of shares of Series A Preferred Stock and
the holders of shares of Common Stock shall vote together as one
class on all matters submitted to a vote of stockholders of the
Corporation.
(C) Except as set forth in this Certificate of Incorporation and
in the Bylaws, holders of Series A Preferred Stock shall have no special
voting rights and their consent shall not be required (except to the
extent they are entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
Section 4. REACQUIRED SHARES. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the acquisition
thereof. All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and may be reissued as
part of a new series of Preferred Stock to be created by resolution or
resolutions of the Board of Directors, subject to the conditions and
restrictions on issuance set forth herein.
Section 5. LIQUIDATION, DISSOLUTION OR WINDING UP.
(A) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of the Series
A Preferred Stock shall be entitled to receive the greater of (a) $9,000
per share, plus accrued dividends to the date of distribution, whether
or not earned or declared, or (b) an amount per share, subject to the
provision for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of Common Stock.
In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such event
pursuant to clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
Section 6. CONSOLIDATION, MERGER, ETC. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other property,
then in any such case the shares of Series A Preferred Stock shall at
the same time be similarly exchanged or changed in an amount per share
(subject to the provision for adjustment hereinafter set forth) equal to
100 times the aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be, into which or for
which each share of Common Stock is changed or exchanged. In the event
the Corporation shall at any time after the Rights Declaration Date (i)
declare any dividend on Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each
such case the amount set forth in the preceding sentence with respect
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to the exchange or change of shares of Series A Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of which
is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
Section 7. NO REDEMPTION. The shares of Series A Preferred
Stock shall not be redeemable.
Section 8. FRACTIONAL SHARES. Series A Preferred Stock may be
issued in fractions of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting
rights, receive dividends, participate in distributions and have the
benefit of all other rights of holders of Series A Preferred Stock. All
payments made with respect to fractional shares hereunder shall be
rounded to the nearest whole cent.
Section 9. CERTAIN RESTRICTIONS.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series A Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which dividends are payable
or in arrears in proportion to the total amounts to which the holders of
all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding up)
to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such terms as the
Board of Directors, after consideration of the respective annual dividend
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rates and other relative rights and preferences of the
respective series and classes shall determine in good faith will result
in fair and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 9, purchase or otherwise acquire such
shares at such time and in such manner.
Section 10. RANKING. The Series A Preferred Stock shall be
junior to all other Series of the Corporation's preferred stock as to
the payment of dividends and the distribution of assets, unless the
terms of any series shall provide otherwise.
Section 11. AMENDMENT. This Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially
alter or change the powers, preferences or special rights of the Series
A Preferred Stock so as to affect them adversely without the affirmative
vote of the holders of two-thirds or more of the outstanding shares of
Series A Preferred Stock voting together as a single class.
FIFTH: A director of this Corporation shall not be personally
liable to the Corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, except for liability (i) for any
breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii)
under Section 174 of the Delaware General Corporation Law, or (iv) for
any transaction from which the director derived an improper personal
benefit.
If the Delaware General Corporation Law is hereafter amended to
authorize the further elimination or limitation of the liability of a
director, then the liability of a director of the Corporation will be
eliminated to the fullest extent permitted by the Delaware General
Corporation Law, as so amended.
Any repeal or modification of the foregoing provisions of this
Article FIFTH by the stockholders of the Corporation shall not adversely
affect any right or protection of a director of the Corporation existing
at the time of such repeal or modification.
SIXTH: The following provisions are inserted for the management of
the business and for the conduct of the affairs of the Corporation, and
for further definition, limitation and regulation of the powers of the
Corporation and of its directors and stockholders.
1. The number of directors shall initially be five and,
thereafter, shall be fixed from time to time exclusively by the Board of
Directors pursuant to a resolution adopted by a majority of the total
number of authorized directors (whether or not there exist any vacancies
in previously authorized directorships at the time any such resolution
is presented to the Board for adoption). The directors shall be divided
into three classes, as nearly equal in number as reasonably possible,
with the term of office of the first class to expire at the annual
meeting of stockholders held in 1991, the term of office of the second
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class to expire at the annual meeting of stockholders held in 1992 and
the term of office of the third class to expire at the annual meeting of
stockholders held in 1993. At each annual meeting of stockholders
following such initial classification and election, directors shall be
elected to succeed those directors whose terms expire for a term of
office to expire at the third succeeding annual meeting of stockholders
after their election. All directors shall hold office until the
expiration of the term for which elected, and until their respective
successors are elected, except in the case of the death, resignation, or
removal of any director. The directors of the Corporation need not be
elected by written ballot unless the Bylaws so provide.
2. Subject to the rights of the holders of any series of
Preferred Stock then outstanding, newly created directorships resulting
from any increase in the authorized number of directors or any vacancies
in the Board of Directors resulting from death, resignation, retirement,
removal from office, disqualification or other cause may be filled only
by a majority vote of the directors then in office, through less than a
quorum, and directors so chosen shall hold office for a term expiring at
the annual meeting of stockholders at which the term of office of the
class to which they have been elected expires. No decrease in the number
of directors constituting the Board of Directors shall shorten the term
of any incumbent director.
3. Subject to the rights of the holders of any series of
Preferred Stock then outstanding, any director, or the entire Board of
Directors, may be removed from office at any time, but only for cause
and only by the affirmative vote of the holders of at least a majority
of the voting power of all of the then outstanding shares of capital
stock of the Corporation entitled to vote generally in the election of
directors ("Voting Stock") voting together as a single class.
4. The Board of Directors is expressly empowered to adopt,
amend, or repeal the Bylaws of the Corporation. Any adoption,
amendment, or repeal of the Bylaws of the Corporation by the Board of
Directors will require the approval of a majority of the total number of
authorized directors (whether or not there exist any vacancies in
previously authorized directorships at the time any resolution providing
for adoption, amendment or repeal is presented to the Board). The
stockholders will also have power to adopt, amend, or repeal the Bylaws
of the Corporation. Any adoption, amendment or repeal of Bylaws of the
Corporation by the Stockholders shall require, in addition to any vote
of the holders of any class or series of stock of this Corporation
required by law or by this Certificate of Incorporation, the affirmative
vote of at least sixty-six and two-thirds percent (66 2/3%) of the Voting
Stock, voting together as a single class.
5. Special meetings of stockholders of the Corporation may
be called only (a) by the Board of Directors or (b) by the President of
the Corporation.
6. Any action required or permitted to be taken by the
stockholders of the Corporation must be effected at a duly called annual
or special meeting of stockholders of the Corporation and may not be
effected by any consent in writing by such stockholders.
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7. The business and affairs of the Corporation shall be
managed by or under the direction of the Board of Directors. In
addition to the powers and authorities expressly conferred upon them by
statute or by this Certificate of Incorporation or by the Bylaws of the
Corporation, the directors are hereby empowered to exercise all such
powers and do all such acts and things as may be exercised or done by
the Corporation; subject, nevertheless, to the provisions of the
statutes of the State of Delaware, to the provisions of this Certificate
of Incorporation, and to any Bylaws from time to time made by the
stockholders or the directors; provided, however, that no Bylaws so made
shall invalidate any prior act of the directors which would have been
valid if such Bylaw had not been made.
SEVENTH: Whenever a compromise or arrangement is proposed between
this Corporation and its creditors or any class of them and/or between
this Corporation and its stockholders or any class of them, any court of
equitable jurisdiction within the State of Delaware, may, on the
application in a summary way of this Corporation or of any creditor or
stockholder thereof or on the application of any receiver or receivers
appointed for this Corporation under the provisions of Section 291 of
Title 8 of the Delaware Code, or on the application of trustees in
dissolution or of any receiver or receivers appointed for this
Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code, order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of this Corporation,
as the case may be, to be summoned in such manner as such court shall
direct. If a majority in number of representing three-fourths (3/4) in
value of the creditors or class of creditors, and three-fourths (3/4) of
the outstanding shares of each class and series of the Corporation's
capital stock, voting separately as a class, agree to any compromise or
arrangement and to any reorganization of this Corporation as a
consequence of such compromise or arrangement, the said compromise or
arrangement and the said reorganization shall, if sanctioned by the
court to which the said application has been made, be binding on all the
creditors or class of creditors, and/or on all the stockholders or class
of stockholders, of this Corporation, as the case may be, and also on
this Corporation.
EIGHTH: The Board of Directors of the Corporation (the "Board"),
when evaluating any offer of another party (a) to make a tender or
exchange offer for any Voting Stock of the Corporation (as defined in
Article SIXTH) or (b) to effect any merger, consolidation, or sale of
all or substantially all of the assets of the Corporation, shall, in
connection with the exercise of its judgment in determining what is in
the best interests of the Corporation as a whole, be authorized to give
due consideration to such factors as the Board determines to be
relevant, including, without limitation:
(i) The interests of the Corporation's stockholders;
(ii) whether the proposed transaction might violate
federal or state laws;
(iii) not only the consideration being offered in the
proposed transaction, in relation to the then current market price for
the outstanding capital stock of
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the Corporation, but also to the market price for the capital stock of
the Corporation over a period of years, the estimated price that might be
achieved in a negotiated sale of the Corporation as a whole or in part
or through orderly liquidation, the premiums over market price for the
securities of other corporations in similar transactions, current
political, economic and other factors bearing on securities prices and
the Corporation's financial condition and future prospects; and
(iv) the social, legal and economic effects upon
employees, suppliers, customers and others having similar relationships
with the Corporation, and the communities in which the Corporation
conducts its business.
In connection with any such evaluation, the Board is authorized to
conduct such investigations and to engage in such legal proceedings as
the Board may determine.
NINTH: The Corporation reserves the right to amend or repeal any
provision contained in this Certificate of Incorporation in the manner
prescribed by the laws of the State of Delaware and all rights conferred
upon stockholders are granted subject to this reservation; PROVIDED,
HOWEVER, that, notwithstanding any other provision of this Certificate
of Incorporation or any provision of law which might otherwise permit a
lesser vote or no vote, but in addition to any vote of the holders of
any class or series of the stock of this Corporation required by law or
by this Certificate of Incorporation, the affirmative vote of the
holders of at least sixty-six and two-thirds percent (662/3%) of the
then-outstanding shares of the Voting Stock, voting together as a single
class, shall be required to amend this Article NINTH, Article FIFTH,
Article SIXTH or Article EIGHTH.
1. Thereafter, at the Corporation's 1995 Annual Meeting of the
Stockholders duly called and held August 18, 1995, amendments included in the
above restatement were approved by the holders of outstanding stock having
not less than eighty percent (80%) of the then-outstanding shares of the
Corporation's capital stock, voting together as a single class.
2. The amendment and restatement of the Certificate of Incorporation
was duly adopted and approved in accordance with the provisions of Sections
242 and 245 of the General Corporation Law of the State of Delaware.
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3. The Corporation's capital will not be reduced as a result of the
amendment and restatement of the Certificate of Incorporation.
IN WITNESS WHEREOF, the corporation has caused this certificate to be
signed by Leslie G. Denend, its President, and Jill E. Fishbein, its
Secretary, effective this day of August 29, 1996.
By: /s/ Leslie G. Denend
-------------------------
Leslie G. Denend
President
Attest: /s/ Jill E. Fishbein
-----------------------
Jill E. Fishbein
Secretary
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[LETTERHEAD]
ATTORNEYS AT LAW
400 HAMILTON AVENUE
PALO ALTO, CA 94301-1825
TEL (415) 328-6561
FAX (415) 327-3699
EXHIBIT 5
OUR FILE NO.
1140342-905700
September 16, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
As legal counsel for Network General Corporation, a Delaware corporation
(the "Company"), we are rendering this opinion in connection with the
registration under the Securities Act of 1933, as amended, of up to 2,200,000
shares of the Common Stock, $0.01 par value, of the Company which may be
issued pursuant to the exercise of options and purchase rights granted under
the Network General Corporation 1989 Stock Option Plan, 1989 Outside
Directors Stock Option Plan and 1989 Employee Stock Purchase Plan (the
"Plans").
We have examined all instruments, documents and records which we deemed
relevant and necessary for the basis of our opinion hereinafter expressed.
In such examination, we have assumed the genuineness of all signatures and
the authenticity of all documents submitted to us as originals and the
conformity to the originals of all documents submitted to us as copies. We
are admitted to practice only in the State of California and we express no
opinion concerning any law other than the law of the State of California, the
corporation laws of the State of Delaware and the federal law of the United
States. As to matters of Delaware corporation law, we have based our opinion
solely upon our examination of such laws and the rules and regulations of the
authorities administering such laws, all as reported in standard, unofficial
compilations. We have not obtained opinions of counsel licensed to practice
in jurisdictions other than the State of California.
Based on such examination, we are of the opinion that the 2,200,000
shares of Common Stock which may be issued upon exercise of options and
purchase rights granted under the Plans are duly authorized shares of the
Company's Common Stock, and, when issued against receipt of the consideration
therefor in accordance with the provisions of the Plans, will be validly
issued, fully paid and nonassessable. We hereby consent to the filing of
this opinion as an exhibit to the Registration Statement referred to above
and the use of our name wherever it appears in said Registration Statement.
Respectfully submitted,
/s/ Gray Cary Ware & Freidenrich
GRAY CARY WARE & FREIDENRICH
A Professional Corporation
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
April 19, 1996 included in Network General Corporation's Form 10-K for the
year ended March 31, 1996.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
San Jose, California
September 17, 1996
