<PAGE> 1
As filed with the Securities and Exchange Commission on January 9, 1998
Registration No. 333-______
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
COMPUWARE CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MICHIGAN 38-2007430
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
31440 Northwestern Highway, Farmington Hills, Michigan 48334-2564
(Address of Principal Executive Offices) (Zip Code)
Nu-Mega Technologies, Inc. 1996 Stock Plan
(Full title of the plan)
Peter Karmanos, Jr., Chairman
Compuware Corporation
31440 Northwestern Highway
Farmington Hills, Michigan 48334-2564
(Name and address of agent for service)
(248) 737-7300
(Telephone number, including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price offering registration
registered registered per share (2) price (2) fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock (1) 772,168 $ 2.63 $2,030,801.84 $599.09
Common Stock (1) 15,120 5.91 89,359.20 26.36
Common Stock (1) 69,886 7.89 551,400.54 162.66
Common Stock (1) 1,141 23.66 26,996.06 7.96
-------- ------------- -------
Total 858,315 $2,698,557.64 $796.07
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) $.01 par value per share ("Common Stock").
(2) Calculated pursuant to Rule 457(h) for the purpose of computing the
registration fee and based on the exercise price of the options.
2
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed below are incorporated by reference in this
registration statement:
1. The Annual Report of Compuware Corporation (the "Registrant")
on Form 10-K for the fiscal year ended March 31, 1997, as filed with
the Securities and Exchange Commission (the "Commission") under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
2. Any other reports filed by the Registrant pursuant to Section
13(a) or 15(d) of the Exchange Act, since the end of the fiscal year
ended March 31, 1997.
3. The description of Registrant's Common Stock contained in
Registrant's Registration Statement on Form S-1, filed with the
Securities and Exchange Commission on October 23, 1992 (Commission
File No. 33-53652), including any amendment or report filed for the
purpose of updating such description.
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of
a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTOR AND OFFICERS.
Under Sections 561-571 of the Michigan Business Corporation Act,
director and officers of a Michigan corporation may be entitled to
indemnification by the corporation against judgments, expenses, fines and
amounts paid by the director or officer in settlement of the claims brought
against them by third persons or by or in the right of the corporation if those
directors and officers acted in good faith and in a manner reasonably believed
to be in, or not opposed to, the best interests of the corporation or its
shareholders.
3
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The Registrant is obligated under its Bylaws to indemnify a present or
former director or executive officer of the Registrant, and may indemnify any
other person, to the fullest extent now or hereafter authorized or permitted by
law in connection with any actual or threatened civil, criminal, administrative
or investigative action, suit or proceeding arising out of his or her past or
future service to the Registrant, or to another corporation at the request of
the Registrant. In addition, the Articles of Incorporation of the Registrant
limit certain personal liabilities of directors of the Registrant; provided,
however, that the Articles of Incorporation do not eliminate or limit the
liability of a director of any of the following: (i) a breach of the
director's duty of loyalty to the corporation or its shareholders; (ii) acts or
omissions not in good faith or that involve intentional misconduct or knowing
violation of law; (iii) a violation of Section 551(1) of the Michigan Business
Corporation Act; (iv) a transaction from which the director derived an improper
personal benefit; or (v) an act or omission occurring before the effective date
of the Article.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 Registrant's Restated Articles of Incorporation (incorporated
by reference to Exhibit 3.1 to Registrant's Registration
Statement on Form S-1, as amended, Registration No. 33-53652).
4.2 Registrant's Amendment to Restated Articles of Incorporation
(incorporated by reference to Exhibit 3.1 to Registrant's
Registration Statement on Form S-4, as amended, Registration
No. 33-78822).
4.3 Registrant's Certificate of Amendment to Restated Articles of
Incorporation (incorporated by reference to Exhibit 3.2 to
Registrant's Registration Statement on Form S-4, as amended,
Registration No. 33-78822).
4.4 Registrant's Correction to Restated Articles of Incorporation
(incorporated by reference to Exhibit 3.3 to Registrant's
Registration Statement on Form S-4, as amended, Registration
No. 33-78822).
4.5 Registrant's Certificate of Amendment to Restated Articles of
Incorporation (incorporated by reference to Exhibit 4.6 to
Registrant's Registration Statement on Form S-8, Registration
No. 333-37873).
4.6 Registrant's Restated Bylaws, as amended (incorporated by
reference to Exhibit 3.3 to Registrant's Registration
Statement on Form S-1, as amended, Registration No. 33-53652).
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4.7 NuMega Technologies, Inc. 1996 Stock Plan.
5 Opinion of Honigman Miller Schwartz and Cohn.
23.1 Independent Auditors' Consent.
23.2 Consent of Honigman Miller Schwartz and Cohn (included in the
opinion filed as Exhibit 5 to this Registration Statement).
24.1 Powers of Attorney (included after the signature of the
Registrant contained on page 7 of this Registration Statement).
ITEM 9. UNDERTAKINGS.
(a) 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 this 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)(1)(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 Securities
Exchange Act of 1934 that are incorporated by reference int he
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.
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(b) 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 therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) 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 Securities 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 Securities Act and
will be governed by the final adjudication of such issue.
EXPERTS
The consolidated financial statements incorporated in this
Registration Statement by reference from the Annual Report on Form 10-K of
Compuware Corporation for the year ended March 31, 1997, have been audited by
Deloitte & Touche, LLP independent auditors, as stated in their report which is
incorporated herein by reference and has been so incorporated in reliance upon
the report of such firm given on their authority as experts in accounting and
auditing.
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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-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Farmington Hills, State of Michigan, on
January 7, 1998.
COMPUWARE CORPORATION
BY: /s/ Thomas Costello, Jr.
-------------------------------
Thomas Costello, Jr.
Senior Vice President
General Counsel and Secretary
POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Thomas Costello, Jr. and W.
James Prowse or either of them, his/her true and lawful attorneys-in-fact and
agents, each with full power of substitution for him/her and in his/her name,
place and stead, in any and all capacities, to sign any or all amendments
(including without limitation post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto each of said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he/she might or
could do in person, hereby ratifying and confirming all that any said
attorneys-in-fact and agents, or his/her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<Capiton>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Peter Karmanos, Jr. Chairman of the Board, Chief January 7, 1998
- ---------------------------------- Executive Officer and Director
Peter Karmanos, Jr. (Principal Executive Officer)
/s/ Thomas Thewes Vice Chairman of the Board January 7, 1998
- ---------------------------------- and Director
Thomas Thewes
</TABLE>
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<TABLE>
<S> <C> <C>
/s/ Joseph A. Nathan President, Chief Operating Officer January 7, 1998
- ---------------------------------- and Director
Joseph A. Nathan
/s/ W. James Prowse Senior Vice President and January 7, 1998
- ---------------------------------- Director
W. James Prowse
/s/ Ralph A. Caponigro Senior Vice President and Chief January 6, 1998
- ---------------------------------- Financial Officer (Principal
Ralph A. Caponigro Financial Officer and
Principal Accounting Officer)
Director January ___, 1998
- ----------------------------------
Bernard M. Goldsmith
Director January ___, 1998
- ----------------------------------
William O. Grabe
/s/ William R. Halling Director January 7, 1998
- ----------------------------------
William R. Halling
/s/ G. Scott Romney Director January 8, 1998
- ----------------------------------
G. Scott Romney
Director January ___, 1998
- ----------------------------------
Lowell Weicker, Jr.
Director January ___, 1998
- ----------------------------------
Elaine K. Didier
Director January ___, 1998
- ----------------------------------
Elizabeth A. Chappell
</TABLE>
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT PAGE NO.
- ------ ------- --------
<S> <C> <C>
4.1 Registrant's Restated Articles of Incorporation
(incorporated by reference to Exhibit 3.1 to Registrant's
Registration Statement on Form S-1, as amended,
Registration No. 33-53652).
4.2 Registrant's Amendment to Restated Articles of
Incorporation (incorporated by reference to Exhibit 3.1
to Registrant's Registration Statement on Form S-4,
as amended, Registration No. 33-78822).
4.3 Registrant's Certificate of Amendment to Restated
Articles of Incorporation (incorporated by reference
to Exhibit 3.2 to Registrant's Registration Statement
on Form S-4, as amended, Registration No. 33-78822).
4.4 Registrant's Correction to Restated Articles of
Incorporation (incorporated by reference to Exhibit 3.3
to Registrant's Registration Statement on Form S-4,
as amended, Registration No. 33-78822).
4.5 Registrant's Certificate of Amendment to Restated
Articles of Incorporation (incorporated by reference
to Exhibit 4.6 to Registrant's Registration Statement
on Form S-8, Registration No. 333-37873).
4.6 Registrant's Restated Bylaws, as amended
(incorporated by reference to Exhibit 3.3 to
Registrant's Registration Statement on Form S-1,
as amended, Registration No. 33-53652).
4.7 NuMega Technologies, Inc. 1996 Stock Plan.
5 Opinion of Honigman Miller Schwartz and Cohn.
23.1 Independent Auditors' Consent.
</TABLE>
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23.2 Consent of Honigman Miller Schwartz and Cohn
(included in the opinion filed as Exhibit 5.1 to this
Registration Statement).
24.1 Powers of Attorney (included after the signature
of the Registrant contained on page 7 of this
Registration Statement).
10
<PAGE> 1
EXHIBIT 4.7
NU-MEGA TECHNOLOGIES, INC.
1996 STOCK PLAN
1. Purpose. This 1996 Stock Plan (the "Plan") is intended to provide
incentives: (a) to employees of NU-MEGA TECHNOLOGIES, INC. (the "Company"), its
parent (if any) and any present or future subsidiaries of the Company
(collectively, "Related Corporations") by providing them with opportunities to
purchase stock in the Company pursuant to options granted hereunder which
qualify as "incentive stock options" under Section 422(b) of the Internal
Revenue Code of 1986, as amended (the "Code") ("ISO" or "ISOs"); (b) to
directors, officers, employees and consultants of the Company and Related
Corporations by providing them with opportunities to purchase stock in the
Company pursuant to options granted hereunder which do not qualify as ISOs
("Non-Qualified Option" or "Non-Qualified Options"); (c) to directors,
officers, employees and consultants of the Company and Related Corporations by
providing them with awards of stock in the Company ("Awards"); and (d) to
directors, officers, employees and consultants of the Company and Related
Corporations by providing them with opportunities to make direct purchases of
stock in the Company ("Purchases"), Both ISOs and Non-Qualified Options are
referred to hereafter individually as an "Option" and collectively as
"Options". Options, Awards and authorizations to make Purchases are referred to
hereafter collectively as "Stock Rights". As used herein, the terms "parent"
and "subsidiary" mean "parent corporation" and "subsidiary corporation",
respectively, as those terms are defined in Section 425 of the Code.
2. Administration of the Plan.
A. The Plan shall be administered by the Board of Directors of the Company
(the "Board"). Members of the Board who are either (i) eligible for Stock
Rights pursuant to the Plan or (ii) have been granted Stock Rights may vote on
any matters affecting the administration of the Plan or the grant of any Stock
Rights pursuant to the Plan, except that no such member shall act upon the
granting to himself of Stock Rights, but any such member may be counted in
determining the existence of a quorum at any meeting of the Board during which
action is taken with respect to the granting to him of Stock Rights. All
references in this Plan to the Committee shall mean the Board if no Committee
has been appointed pursuant to subparagraphs B or C of this Section 2 below.
B. The Board may delegate its powers with respect to the administration
of the Plan to a stock plan committee (the "Committee") appointed by the Board,
provided that such Committee shall be composed pursuant to subparagraph C
below if the Company registers any class of any equity security pursuant to
Section 12 of the Securities Exchange Act of
<PAGE> 2
1934, as amended (the "Exchange Act"). The Committee may select one of its
members as its chairman, and shall hold meetings at such time and places as it
may determine. Acts by a majority of the Committee, or acts reduced to or
approved in writing by a majority of the members of the Committee, shall be the
valid acts of the Committee. From time to time the Board may increase or
decrease the size of the Committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies however caused, or remove all members of the Committee
and thereafter directly administer the Plan.
C. Notwithstanding the foregoing, if the Company registers any class of
any equity security pursuant to Section 12 of the Exchange Act, the Plan shall
be administered by the Committee (unless and until its members are not
qualified to serve on the Committee pursuant to the provisions of the Plan)
which shall be composed of not fewer than two (2) members of the Board who
shall be appointed from time to time by the Board. No member of such Committee
may exercise discretion with respect to, or participate in, the administration
of the Plan if, at any time, while a member of the Committee or during the
twelve (12)-month period prior to such exercise or participation, he has been
granted or awarded Stock Rights or any other derivative security of the Company
or any of its affiliate under this Plan or any similar plan of the Company,
except that:
(a) participation in a "Formula Plan" shall not disqualify a director from
being a disinterested person. A Formula Plan is a plan which:
(i) permits officers and/or directors to receive awards and either
(A) states the amount and price of securities to be awarded to
designated officers and directors or categories of officers and
directors, though not necessarily to others who may participate in
the plan, and specifies the timing of awards to officers and
directors or (B) sets forth a formula that determines the amount,
price and timing of awards, using objective criteria such as
earnings of the Company, value of the securities, years of service,
job classification, and compensation levels; and
(ii) provides that these plan provisions shall not be amended more
than once every six (6) months, other than to comport with changes
in the Code, the Employee Retirement Income Security Act ("ERISA"),
or the rules thereunder;
(b) participation in an ongoing securities acquisition plan which meets
the following conditions shall not disqualify a director from being a
disinterested person:
2
<PAGE> 3
(i) the plan provides for broad-based employee participation and the
terms of the plan do not discriminate in favor of highly compensated
employees;
(ii) officer or director participants making withdrawals must cease
further purchases in the plan for six (6) months, or the securities
so distributed must be held by the participant six (6) months prior
to disposition; provided, however, that extraordinary distributions
of all of the Company's securities held by the plan and distributions
in connection with death, retirement, disability, termination of
employment, or a qualified domestic relations order as defined by the
Code or Title I of ERISA, or the rules thereunder, are not subject to
this requirement;
(iii) officer or director participants who cease participation in the
plan may not participate again for at least six (6) months; and
(iv) for stock purchase plans under Section 423 of the Internal
Revenue Code or similar plans, Where The Purchase Price of the stock
is not fixed and the participant is not obligated to purchase the
stock until exercise of a right, in addition to the foregoing
conditions, the stock acquired is held for six (6) months from the
date the stock purchase price is fixed.
(c) an election to receive an annual retainer fee in either cash or an
equivalent amount of securities, or partly in cash and partly in securities,
shall not disqualify a director from being a disinterested person; and
(d) participation in a plan shall not disqualify a director from being a
disinterested person for the purpose of administering another plan that does
not permit participation by directors.
Members of the Committee shall be subject to any additional restrictions
necessary to satisfy the requirements for disinterested administration of the
Plan as set forth in Rule 16b-3 under the Exchange Act, as it may be amended
from time to time. If at any time any member of the Committee does not satisfy
such disinterested administration requirements, no stock options shall be
granted under the Plan to any director or officer until such time as all
members of the Committee satisfy such requirements.
D. Subject to ratification of the grant or authorization of each Stock
Right by the Board (if so required by applicable state law), and subject to the
terms of the Plan, the Committee shall have the authority to (i) determine the
employees of the Company and
3
<PAGE> 4
Related Corporations (from among the class of employees eligible under
paragraph 3 to receive ISOs) to whom ISOs may be granted, and to determine
(from among the class of individuals and entities eligible under paragraph 3 to
receive Non-Qualified Options and Awards and to make Purchases) to whom
Non-Qualified Options, Awards and authorizations to make Purchases may be
granted; (ii) determine the time or times at which Options or Awards may be
granted or Purchases made; (iii) determine the option price of shares subject
to each Option, which price shall not be less than the minimum price (if any)
specified in paragraph 6, and the purchase price of shares subject to each
Purchase; (iv) determine whether each Option granted shall be an ISO or a
Non-Qualified Option; (v) determine (subject to paragraph 7) the time or times
when each Option shall become exercisable and the duration of the exercise
period; (vi) determine whether restrictions such as repurchase options are to
be imposed on shares subject to Options, Awards and Purchases and the nature of
such restrictions, if any; and (vii) interpret the Plan and prescribe and
rescind rules and regulations relating to it. If the Committee determines to
issue a Non-Qualified Option, it shall take whatever actions it deems
necessary, under Section 422 of the Code and the regulations promulgated
thereunder, to ensure that such Option is not treated as an ISO. The
interpretation and construction by the Committee of any provisions of the Plan
or of any Stock Right granted under it shall be final unless otherwise
determined By The Board. The Committee may from time to time adopt such rules
and regulations for carrying out the Plan as it may deem best. No member of the
Board or the Committee shall be liable for any action or determination made in
good faith with respect to the Plan or any Stock Right granted under it.
3. Eligible Employees and Others. ISOs may be granted to any employee of
the Company or any Related Corporation. Those officers and directors of the
Company who are not employees may not be granted ISOs under the Plan.
NonQualified Options, Awards and authorizations to make Purchases may be
granted to any director (whether or not an employee), officer, employee or
consultant of the Company or any Related Corporation. The granting of any Stock
Right to any Individual or entity shall neither entitle that individual or
entity to, nor disqualify him from, participation in any other grant of Stock
Rights.
4. Stock. The stock subject to Options, Awards and Purchases shall be
authorized but unissued shares of Common Stock of the Company, no par value
(the "Common Stock"), or shares of Common Stock reacquired by the Company in
any manner. The aggregate number of shares which may be issued pursuant to the
Plan is 2,000,000, subject to adjustment as provided in paragraph 13. Any such
shares may be issued as ISOs, Non-Qualified Options or Awards, or to persons or
entities making Purchases, so long as the number of shares so issued does not
exceed such number, as adjusted. If any Option granted under the Plan shall
expire or terminate for any reason without having been exercised in full or
shall cease for any
4
<PAGE> 5
reason to be exercisable in whole or in part, or if the Company shall reacquire
any vested shares issued pursuant to Awards or Purchases, the unpurchased
shares subject to such Options and any unvested shares so reacquired by the
Company shall again be available for grants of Stock Rights under the Plan.
5. Granting of Stock Rights. Stock Rights may be granted under the Plan at
any time after April 3, 1996 and prior to April 3, 2006. The date of grant of a
Stock Right under the Plan will be the date specified by the Committee at the
time it grants the Stock Right; provided, however, that such date shall not be
prior to the date on which the Committee acts to approve the grant. The
Committee shall have the right, with the consent of the optionee, to convert
any ISO granted under the Plan to a NonQualified Option pursuant to paragraph
15.
6. Minimum Option Price; ISO Limitations.
A. The price per share specified in the agreement relating to each ISO
granted under the Plan shall not be less than the fair market value per share
of Common Stock on the date of such grant. In the case of an ISO to be granted
to an employee owning stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any Related
Corporation, the price per share specified in the agreement relating to such
ISO shall not be less than one hundred ten percent (110%) of the fair market
value per share of Common Stock on the date of grant.
B. In no event shall the aggregate fair market value (determined at the
time an ISO is granted) of Common Stock for which ISOs granted to any employee
are exercisable for the first time by such employee during any calendar year
(under all stock option plans of the Company and any Related Corporation)
exceed $100,000; provided that this paragraph 6(B) shall have no force or
effect if its inclusion in the Plan is not necessary for Options issued as ISOs
to qualify as ISOs pursuant to Section 422(d) of the Code.
C. If, at the time an Option is granted under the Plan, the Company's
Common Stock is publicly traded, "fair market value" shall be determined as of
the last business day for which the prices or quotes discussed in this sentence
are available prior to the date such Option is granted and shall mean (i) the
average (on that date) of the high and low prices of the Common Stock on the
principal national securities exchange on which the Common stock is traded, if
the Common Stock is then traded on a national securities exchange; or (ii) the
last reported sale price (on that date) of the Common Stock on the NASDAQ
National Market List, if the Common Stock is not then traded on a national
securities exchange; or (iii) the closing bid price (or average of bid prices)
last quoted (on that date) by an
5
<PAGE> 6
established quotation service for over-the-counter securities, if the Common
Stock is not reported on the NASDAQ National Market List. However, if the
Common Stock is not publicly traded at the time an Option is granted under the
Plan, "fair market value" shall be deemed to be the fair value of the Common
Stock as determined by the Committee after taking into consideration all
factors which it deems appropriate, including, without limitation, recent sale
and offer prices of the Common Stock in private transactions negotiated at
arm's length.
7. Option Duration. Subject to earlier termination as provided in
paragraphs 9 and 10, each Option shall expire on the date specified by the
Committee, but not more than (i) ten (10) years and one day from the date of
grant in the case of Non-Qualified Options, (ii) ten (10) years from the date
of grant in the case of ISOs generally, and (iii) five (5) years from the date
of grant in the case of ISOs granted to an employee owning stock possessing
more than ten percent (10%) of the total combined voting power of all classes
of stock of the Company or any Related Corporation. Subject to earlier
termination as provided in paragraphs 9 and 10, the term of each ISO shall be
the term set forth in the original instrument granting such ISO, except with
respect to any part of such ISO that is converted into a Non-Qualified Option
pursuant to paragraph 15.
8. Exercise of Option. Subject to the provisions of paragraphs 9 through
12, each Option granted under the Plan shall be exercisable as follows:
A. The Option shall either be fully exercisable on the date of grant or
shall become exercisable thereafter in such installments as the Committee may
specify.
B. Once an installment becomes exercisable it shall remain exercisable
until expiration or termination of the Option, unless otherwise specified by
the Committee.
C. Each Option or installment may be exercised at any time or from time to
time, in whole or in part, for up to the total number of shares with respect to
which it is then exercisable.
D. The Committee shall have the right to accelerate the date of exercise
of any installment of any Option; provided that the Committee shall not
accelerate the exercise date of any installment of any Option granted to any
employee as an ISO (and not previously converted into a Non-Qualified Option
pursuant to paragraph 15) if such acceleration would violate the annual vesting
limitation contained in Section 422(d) of the Code, as described in paragraph
6(B).
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<PAGE> 7
9. Termination of Employment. If an ISO optionee ceases to be employed by
the Company and all Related Corporations other than by reason of death or
disability as defined in paragraph 10, no further installments of his ISOs
shall become exercisable, and his ISOs shall terminate after the passage of
sixty (60) days, from the date of termination of his employment, but in no
event later than on their specified expiration dates, except to the extent that
such ISOs (or unexercised installments thereof) have been converted into
NonQualified Options pursuant to paragraph 15. Employment shall be considered
as continuing uninterrupted during any bona fide leave of absence (such as
those attributable to illness, military obligations or governmental service)
provided that the period of such leave does not exceed ninety (90) days or, if
longer, any period during which such optionee's right to reemployment is
guaranteed by statute. A bona fide leave of absence with the written approval
of the Committee shall not be considered an interruption of employment under
the Plan, provided that such written approval contractually obligates the
Company or any Related Corporation to continue the employment of the optionee
after the approved period of absence. ISOs granted under the Plan shall not be
affected by any change of employment within or among the Company and Related
Corporations, so long as the optionee continues to be an employee of the
Company or any Related Corporation. Nothing in the Plan shall be deemed to give
any grantee of any Stock Right the right to be retained in employment or other
service by the Company or any Related Corporation for any period of time.
10. Death; Disability.
A. If an ISO optionee ceases to be employed by the Company and all Related
Corporations by reason of his death, any ISO of his may be exercised, to the
extent of the number or shares with respect to which he could have exercised it
on his death, by his estate, personal representative or beneficiary who has
acquired the ISO by will or by the laws of descent and distribution, at any
time prior to the earlier of the ISO's specified expiration date or 180 days
from the date of the optionee's death.
B. If an ISO optionee ceases to be reemployed by the Company and all
Related Corporations by reason of his disability, he shall have the right to
exercise any ISO held by him on the date of termination of employment, to the
extent of the number of shares with respect to which he could have exercised it
on that date, at any time prior to the earlier of the ISO's specified
expiration date or 180 days from the date of the termination of the optionee's
employment. For the purposes of the Plan, the term "disability" shall mean
"permanent and total disability" as defined in Section 22(e)(3) of the Code or
successor statute.
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11. Assignability. No Stock Right shall be assignable or transferable by
the grantee except by will or by the laws of descent and distribution, and
during the lifetime of the grantee each Stock Right shall be exercisable only
by him.
12. Terms and Conditions of Options. Options shall be evidenced by
instruments (which need not be identical) in such forms as the Committee may
from time to time approve. Such instruments shall conform to the terms and
conditions set forth in paragraphs 6 through 11 hereof and may contain such
other provisions as the Committee deems advisable which are not inconsistent
with the Plan, including restrictions applicable to shares of Common Stock
issuable upon exercise of Options. In granting any Non-Qualified Option, the
Committee may specify that such Non-Qualified Option shall be subject to the
restrictions set forth herein with respect to ISOs, or to such other
termination and cancellation provisions as the Committee may determine. The
Committee may from time to time confer authority and responsibility on one or
more of its own members and/or one or more officers of the Company to execute
and deliver such instruments. The proper officers of the Company are authorized
and directed to take any and all action necessary or advisable from time to
time to carry out the terms of such instruments.
13. Adjustments. Upon the occurrence of any of the following events, an
optionee's rights with respect to Options granted to him hereunder shall be
adjusted as hereinafter provided, unless otherwise specifically provided in the
written agreement between the optionee and the Company relating to such Option:
A. If the shares of Common Stock shall be subdivided or combined into a
greater or smaller number of shares or if the Company shall issue any shares of
Common Stock as a stock dividend on its outstanding Common Stock, the number of
shares of Common Stock deliverable upon the exercise of Options shall be
appropriately increased or decreased proportionately, and appropriate
adjustments shall be made in the purchase price per share to reflect such
subdivision, combination or stock dividend.
B. Notwithstanding the foregoing, any adjustments made pursuant to
subparagraph A with respect to ISOs shall be made only after the Committee,
after consulting with counsel for the Company, determines whether such
adjustments would constitute a "modification" of such ISOs (as that term is
defined in Section 425 of the Code) or would cause any adverse tax consequences
for the holders of such ISOs. If the Committee determines that such adjustments
made with respect to ISOs would constitute a modification of such ISOs, it may
refrain from making such adjustments.
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C. Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares subject to Options. No adjustments
shall be made for dividends paid in cash or in property other than securities
of the Company.
D. No fractional shares shall be issued under the Plan and the optionee
shall receive from the Company cash in lieu of such fractional shares.
E. Upon the happening of any of the foregoing events described in
subparagraph A above, the class and aggregate number of shares set forth in
paragraph 4 hereof that are subject to Stock Rights which previously have been
or subsequently may be granted under the Plan shall also be appropriately
adjusted to reflect the events described in such subparagraphs. The Committee
or the Successor Board shall determine the specific adjustments to be made
under this paragraph 13 and, subject to paragraph 2, its determination shall be
conclusive.
If any person or entity owning restricted Common Stock obtained by exercise of
a Stock Right made hereunder receives shares or securities or cash in
connection with a corporate transaction described in subparagraph A above as a
result of owning such restricted Common Stock, such shares or securities or
cash shall be subject to all of the conditions and restrictions applicable to
the restricted Common Stock with respect to which such shares or securities or
cash were issued, unless otherwise determined by the Committee or the Successor
Board.
14. Means of Exercising Stock Rights. A Stock Right (or any part or
installment thereof) shall be exercised by giving written notice to the Company
at its principal office address. Such notice shall identify the Stock Right
being exercised and specify the number of shares as to which such Stock Right
is being exercised, accompanied by full payment of the purchase price therefor
either (a) in United States dollars in cash or by check, or (b) at the
discretion of the Committee, through delivery of shares of Common Stock having
a fair market value equal as of the date of the exercise to the cash exercise
price of the Stock Right, or (c) at the discretion of the Committee, by
delivery of the grantee's personal recourse note bearing interest payable not
less than annually at no less than 100% of the lowest applicable Federal rate,
as defined in Section 1274(d) of the Code, or (d) at the discretion of the
Committee, by any combination of (a), (b) and (c) above. If the Committee
exercises its discretion to permit payment of the exercise price of an ISO by
means of the methods set forth in clauses (b), (c), or (d) of the preceding
sentence, such discretion shall be exercised in writing at the time of the
grant of the ISO in question. The holder of a Stock Right shall
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not have the rights of a stockholder with respect to the shares covered by his
Option until the date of issuance of a stock certificate to him for such
shares. Except as expressly provided above in paragraph 13 with respect to
changes in capitalization and stock dividends, no adjustment shall be made for
dividends or similar rights for which the record date is before the date such
stock certificate is issued.
15. Terms and Amendment of Plan. This Plan was adopted by the Board on
April 3, 1996, subject to approval of the Plan by the holders of a majority of
the outstanding shares of Common Stock of the Company present, or represented,
and entitled to vote at a stockholders' meeting held within twelve (12) months
thereafter. Any Stock Rights granted prior to such stockholder approval shall
become null and void if such stockholder approval is not obtained. The Plan
shall expire on April 3, 2006; provided, however, that the Plan and all Stock
Rights granted under the Plan prior to such date shall remain in effect and
subject to adjustment and amendment as herein provided until they have been
satisfied or terminated in accordance with the terms of the respective grants
or awards and the related option instruments. The Board may terminate or amend
the Plan in any respect at any time without the authorization of stockholders
to the extent allowed by law, including without limitation any rules issued by
the Securities and Exchange Commission under Section 16 of the Exchange Act,
except that, unless approved by the stockholders, it may not: (a) increase the
total number of shares that may be issued under the Plan (except by adjustment
pursuant to paragraph 13); (b) modify the provisions of paragraph 3 regarding
eligibility for grants of ISOs; (c) modify the provisions of paragraph 6(B)
regarding the exercise price at which shares may be offered pursuant to ISOs
(except by adjustment pursuant to paragraph 13); and (d) extend the expiration
date of the Plan. In no event may action of the Board or stockholders alter or
impair the rights of a grantee, without his consent, under any Stock Right
previously granted to him.
16. Application of Funds. The proceeds received by the Company from the
sale of shares pursuant to Options granted and Purchases authorized under the
Plan shall be used for general corporate purposes.
17. Governmental Regulation. The Company's obligation to sell and deliver
shares of the Common Stock under this Plan is subject to the approval of any
governmental authority required in connection with the authorization, issuance
or sale of such shares.
18. Withholding of Additional Income Taxes. Upon the exercise of a
Non-Qualified Option, the grant of an Award, the making of a Purchase of
Common Stock for less than its fair market value, the making of a Disqualifying
Disposition (as defined in paragraph 19) or the vesting of restricted Common
Stock acquired on the exercise of a Stock Right hereunder.
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the Company, in accordance with Section 3402(a) of the Code, may require the
optionee, Award recipient or purchaser to pay additional withholding taxes in
respect of the amount that is considered compensation includible in such
person's gross income. The Committee in its discretion may condition (i) the
exercise of an Option, (ii) the grant of an Award, (iii) the making of a
Purchase of Common Stock for less than its fair market value, or (iv) the
vesting of restricted Common Stock acquired by exercising a Stock Right on the
grantee's payment of such additional withholding taxes.
19. Notice to Company of Disqualified Disposition. Each employee who
receives an ISO must agree to notify the Company in writing immediately after
the employee makes a Disqualifying Disposition of any Common Stock acquired
pursuant to the exercise of an ISO. A Disqualifying Disposition is any
disposition (including any sale) of such Common Stock before the later of (a)
two (2) years after the date the employee was granted the ISO or (b) one
(1) year after the date the employee acquired Common Stock by exercising the
ISO. If the employee has died before such stock is sold, these holding period
requirements do not apply and no Disqualifying Disposition can occur thereafter.
20. Governing Law; Construction. The validity and construction of the Plan
and the instruments evidencing Stock Rights shall be governed by the laws of
the State of New Hampshire. In construing this Plan, the singular shall include
the plural and the masculine gender shall include the feminine and neuter,
unless the context otherwise requires.
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EXHIBIT 5
January 9, 1998
Compuware Corporation
31440 Northwestern Highway
Farmington Hills, Michigan 48334
Gentlemen:
We have represented Compuware Corporation, a Michigan corporation (the
"Company"), in connection with the preparation and filing of a Registration
Statement on Form S-8 (the "Registration Statement"), for the registration
under the Securities Act of 1933, as amended, of 858,375 shares of the common
stock, par value $.01 (the "Common Stock"), of the Company for sale and
issuance pursuant to the terms and conditions of the NuMega Technologies, Inc.
1996 Stock Plan, as assumed by the Company (the "Plan"). We have examined the
proceedings proposed to be taken by the Company in connection with the Plan and
the sale and issuance of the Common Stock pursuant thereto and such other
records, documents and matters as we have deemed necessary or advisable in
order to enable us to render this opinion.
Based upon the above and taking into account such legal considerations
as we have deemed relevant, we are of the opinion that the shares of Common
Stock covered by the Registration Statement to be issued and sold by the
Company have been duly authorized and, when issued and sold by the Company in
the manner referred to in the Registration Statement and the Plan, will be
legally and validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ HONIGMAN MILLER SCHWARTZ AND COHN
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EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Compuware Corporation on Form S-8 of our report dated May 5,
1997, appearing in the Annual Report on Form 10-K of Compuware Corporation for
the year ended March 31, 1997 and to the reference to us under the heading
"Experts" in this Registration Statement.
/s/ DELOITTE & TOUCHE, LLP
Detroit, Michigan
January 7, 1998
