<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
QUALIX GROUP, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
-------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1)Title of each class of securities to which transaction applies:
2)Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4)Proposed maximum aggregate value of transaction:
5)Total fee paid:
[_] Fee paid previously with preliminary materials:
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1)Amount Previously Paid:
2)Form, Schedule or Registration Statement no.:
3)Filing Party:
4)Date Filed:
<PAGE>
October , 1998
TO THE STOCKHOLDERS OF QUALIX GROUP, INC.
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders (the
"Annual Meeting") of Qualix Group, Inc. (the "Company"), which will be held at
the corporate headquarters of the Company, 177 Bovet Road, 2nd Floor, San
Mateo, California 94402 on Monday, November 16, 1998, at 10:00 a.m.
Details of the business to be conducted at the Annual Meeting are given in
the attached Proxy Statement and Notice of Annual Meeting of Stockholders.
It is important that your shares be represented and voted at the meeting.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE, SIGN,
DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE. Returning the proxy does NOT deprive you of your right to attend the
Annual Meeting. If you decide to attend the Annual Meeting and wish to change
your proxy vote, you may do so automatically by voting in person at the
meeting.
On behalf of the Board of Directors, I would like to express our appreciation
for your continued interest in the affairs of the Company. We look forward to
seeing you at the Annual Meeting.
Sincerely,
/s/ Richard G. Thau
Richard G. Thau
Chairman of the Board of Directors,
President and Chief Executive Officer
<PAGE>
QUALIX GROUP, INC.
177 BOVET ROAD, 2ND FLOOR
SAN MATEO, CALIFORNIA 94402
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 16, 1998
----------------
The Annual Meeting of Stockholders (the "Annual Meeting") of Qualix Group,
Inc. (the "Company") will be held at the corporate headquarters of the
Company, 177 Bovet Road, 2nd Floor, San Mateo, California 94402 on Wednesday,
November 16, 1998, at 10:00 a.m. for the following purposes:
1. To elect six directors of the Board of Directors to serve until the next
Annual Meeting or until their successors have been duly elected and
qualified;
2. To approve an amendment to the Company's Certificate of Incorporation to
change the Company's name to "FullTime Software, Inc."
3. To approve the adoption of an Employee Stock Purchase Plan;
4. To ratify the appointment of Deloitte & Touche LLP as the Company's
independent public accountants for the fiscal year ending June 30, 1999;
and
5. To transact such other business as may properly come before the meeting
or any adjournments or postponements thereof.
The foregoing items of business are more fully described in the attached
Proxy Statement.
Only stockholders of record at the close of business on October 6, 1998 are
entitled to notice of, and to vote at, the Annual Meeting and at any
adjournments or postponements thereof. A list of such stockholders will be
available for inspection at the Company's headquarters located at 177 Bovet
Road, 2nd Floor, San Mateo, California 94402, during ordinary business hours
for the ten-day period prior to the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
Bruce C. Felt
Secretary
San Mateo, California
October , 1998
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE
ANNUAL MEETING. IF YOU DECIDE TO ATTEND THE ANNUAL MEETING AND WISH TO
CHANGE YOUR PROXY VOTE, YOU MAY DO SO AUTOMATICALLY BY VOTING IN PERSON AT
THE MEETING.
<PAGE>
QUALIX GROUP, INC.
177 BOVET ROAD, 2ND FLOOR
SAN MATEO, CALIFORNIA 94402
----------------
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 16, 1998
----------------
These proxy materials are furnished in connection with the solicitation of
proxies by the Board of Directors of Qualix Group, Inc., a Delaware
corporation (the "Company"), for the Annual Meeting of Stockholders (the
"Annual Meeting") to be held at the corporate headquarters of the Company, 177
Bovet Road, 2nd Floor, San Mateo, California 94402 on Monday, November 16,
1998, at 10:00 a.m., local time, and at any adjournment or postponement of the
Annual Meeting. These proxy materials were first mailed to stockholders on or
about October , 1998.
PURPOSE OF MEETING
The specific proposals to be considered and acted upon at the Annual Meeting
are summarized in the accompanying Notice of Annual Meeting of Stockholders.
Each proposal is described in more detail in this Proxy Statement.
VOTING RIGHTS AND SOLICITATION OF PROXIES
The Company's Common Stock is the only type of security entitled to vote at
the Annual Meeting. On October 6, 1998, the record date for determination of
stockholders entitled to vote at the Annual Meeting, there were
shares of Common Stock outstanding. Each stockholder of record on October 6,
1998, is entitled to one vote for each share of Common Stock held by such
stockholder on October 6, 1998. Shares of Common Stock may not be voted
cumulatively. All votes will be tabulated by the inspector of election
appointed for the meeting, who will separately tabulate affirmative and
negative votes, abstentions and broker non-votes.
QUORUM REQUIRED
The Company's bylaws provide that the holders of a majority of the Company's
Common Stock issued and outstanding and entitled to vote at the Annual
Meeting, present in person or represented by proxy, shall constitute a quorum
for the transaction of business at the Annual Meeting. Abstentions and broker
non-votes will be counted as present for the purpose of determining the
presence of a quorum.
VOTES REQUIRED
Proposal 1. Directors are elected by a plurality of the affirmative votes
cast by those shares present in person or represented by proxy and entitled to
vote at the Annual Meeting. The six (6) nominees for director receiving the
highest number of affirmative votes will be elected. Abstentions and broker
non-votes are not included in the tabulation of the voting results in the
election of directors. Stockholders may not cumulate votes in the election of
directors.
Proposal 2. Approval of an amendment to the Company's Certificate of
Incorporation to change the Company's name to "FullTime Software, Inc."
requires the affirmative vote of a majority of shares outstanding. Abstentions
and broker non-votes will be treated as votes against the proposal.
<PAGE>
Proposal 3. Approval of the adoption of an Employee Stock Purchase Plan
requires the affirmative vote of a majority of those shares present in person,
or represented by proxy, and cast either affirmatively or negatively at the
Annual Meeting. Abstentions and broker non-votes will not be included in the
tabulation of voting results on adoption of an Employee Stock Purchase Plan.
Proposal 4. Ratification of the appointment of Deloitte & Touche LLP as the
Company's independent public accountants for the fiscal year ending June 30,
1999 requires the affirmative vote of a majority of those shares present in
person, or represented by proxy, and cast either affirmatively or negatively
at the Annual Meeting. Abstentions and broker non-votes will not be included
in the tabulation of voting results on ratification of the appointment of
Deloitte & Touche LLP as the Company's independent public accountants.
Whether or not you are able to attend the Company's Annual Meeting, you are
urged to complete and return the enclosed proxy, which is solicited by the
Company's Board of Directors and which will be voted as you direct on your
proxy when properly completed. In the event no directions are specified, such
proxies will be voted FOR Proposals No. 1, No. 2, No. 3 and No. 4 and, in the
discretion of the proxy holders, as to other matters that may properly come
before the Annual Meeting. You may also revoke or change your proxy at any
time before the Annual Meeting. To do so, send a written notice of revocation
or another signed proxy with a later date to the Secretary of the Company at
the Company's principal executive offices before the beginning of the Annual
Meeting. You may also automatically revoke your proxy by attending the Annual
Meeting and voting in person. All shares represented by a valid proxy received
prior to the Annual Meeting will be voted.
SOLICITATION OF PROXIES
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the proxy
and any additional soliciting material furnished to stockholders. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
In addition, the Company may reimburse such persons for their costs of
forwarding the solicitation material to such beneficial owners. The original
solicitation of proxies by mail may be supplemented by solicitation by
telephone, telegram or other means by directors, officers, employees or agents
of the Company. No additional compensation will be paid to these individuals
for any such services. Except as described above, the Company does not
presently intend to solicit proxies other than by mail.
2
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The directors who are being nominated for election to the Board of Directors
(the "Nominees"), their ages as of September 30, 1998, their positions and
offices held with the Company and certain biographical information are set
forth below. The proxy holders intend to vote all proxies received by them in
the accompanying form FOR the Nominees listed below unless otherwise
instructed. In the event any Nominee is unable or declines to serve as a
director at the time of the Annual Meeting, the proxies will be voted for any
nominee who may be designated by the present Board of Directors to fill the
vacancy. As of the date of this Proxy Statement, the Board of Directors is not
aware of any Nominee who is unable or will decline to serve as a director. The
six (6) Nominees receiving the highest number of affirmative votes of the
shares entitled to vote at the Annual Meeting will be elected directors of the
Company to serve until the next Annual Meeting or until their successors have
been duly elected and qualified.
<TABLE>
<CAPTION>
NOMINEES AGE POSITIONS AND OFFICES HELD WITH THE COMPANY
- -------- --- -------------------------------------------
<S> <C> <C>
Richard G. Thau......... 51 Chairman of the Board, President and Chief Executive Officer
Louis C. Cole........... 55 Director
Kenneth A. Goldman...... 49 Director
William Hart (1)........ 58 Director
William D. Jobe (1)..... 60 Director
Peter L. Wolken (2)..... 64 Director
</TABLE>
- --------
(1) Member of Compensation Committee
(2) Member of Audit Committee
Mr. Thau is Chairman of the Board, President and Chief Executive Officer and
co-founded the Company in September 1990. From September 1985 to January 1990,
he was employed at MicroMRP, a company that develops microcomputer-based
manufacturing, planning and control software, where he served as President and
Chief Executive Officer from November 1985 to January 1990 and as Vice
President, Sales and Marketing from September 1985 to November 1985. From
January 1984 to July 1985, he served as Vice President, Sales and Marketing
for General Parametrics, a hardware and software-based business presentation
systems company. Mr. Thau received a B.S. in Engineering Sciences from State
University of New York at Stony Brook in 1968 and attended the M.B.A. program
at the University of Santa Clara.
Mr. Cole is Chairman of the Board, President and Chief Executive Officer of
Legato Systems, Inc. ("Legato"). Mr. Cole joined Legato as President, Chief
Executive Officer and a director in June 1989; he has served as Chairman of
the Board since April 1995. Before joining Legato, from March 1987 until July
1988, Mr. Cole served as Executive Vice President responsible for all
operating divisions of Novell, Inc., a publicly held manufacturer of computer
networking and software products. Mr. Cole holds B.S. in mathematics and
education from Pennsylvania State University at Edinboro.
Mr. Goldman has served as a director of the Company since May 1998. He has
served as the Senior Vice President and Chief Financial Officer of @ Home
Network since he joined the @ Home Network in July 1996. From July 1992 to
July 1996, he was Senior Vice President and Chief Financial Officer of Sybase,
Inc., a database software and services company. From 1989 to July 1992, Mr.
Goldman was Vice President of Finance and Administration and Chief Financial
Officer at Cypress Semiconductor Corporation, a semiconductor manufacturer.
From 1983 to 1989, he was Vice President and Chief Financial Officer of VLSI
Technology Inc. Mr. Goldman serves on the board of directors of Global Village
Inc. He holds a B.S. degree in Electrical Engineering from Cornell University
and an M.B.A. degree from the Harvard University Graduate School of Business.
Mr. Hart has served as a director of the Company since December 1991. He is
a Managing Partner of Technology Partners, a venture capital management firm
that he founded in 1980. Mr. Hart serves on the Boards
3
<PAGE>
of Directors of Trimble Navigation Ltd., CellNet Data Systems, Inc., Silicon
Gaming, Inc. and several private technology companies. He received a B.S. in
Engineering from Rensselaer Polytechnic Institute in 1965 and an M.B.A. from
the Amos Tuck School at Dartmouth College in 1967.
Mr. Jobe has served as a director of the Company since April 1995. He has
served as a private venture capitalist and computer industry advisor since
July 1991. From June 1990 to July 1991, Mr. Jobe was President of MIPS
Technology Development, a computer hardware company. From August 1987 to June
1990, he was Executive Vice President, Sales, Marketing and Service for MIPS.
Mr. Jobe serves on the Board of Directors of Multimedia Access Corp. Mr. Jobe
received a B.S.M.E. and M.S.M.E. from Texas A&M University in 1962 and a
P.M.D. from Harvard Business School in 1977.
Mr. Wolken has served as a director of the Company since 1990. Mr. Wolken is
a General Partner of AVI Management Partners I, II and III which manage
various private venture capital limited partnerships, having co-founded AVI in
1981. He serves as a director of a number of private technology companies in
Silicon Valley. Mr. Wolken received a B.S. in Mechanical Engineering from the
University of California, Berkeley in 1959 and a B.F.T. in International
Marketing from the American Graduate School for International Management in
1960.
BOARD OF DIRECTORS MEETINGS AND COMMITTEES
During the fiscal year ended June 30, 1998, the Board of Directors held 4
meetings and acted by written consent on 2 occasions. For the fiscal year,
each of the current directors attended at least 75% of the aggregate of (i)
the total number of meetings of the Board of Directors and (ii) the total
number of meetings held by all Committees of the Board of Directors on which
each such director served. The Board of Directors has two standing committees:
the Audit Committee and the Compensation Committee.
During the fiscal year ended June 30, 1998, the Audit Committee of the Board
of Directors held 1 meeting. The Audit Committee is responsible for reviewing
the results and scope of audits and other services provided by the Company's
independent auditors. The members of the Audit Committee are Mr. Goldman and
Mr. Wolken.
During the fiscal year ended June 30, 1998, the Compensation Committee of
the Board of Directors held no meetings and acted by written consent on 11
occasions. The Compensation Committee makes recommendations concerning the
salaries and incentive compensation of employees of, and consultants to, the
Company. The Compensation Committee also administers the Company's 1997 Stock
Option Plan and Employee Stock Purchase Plan. The members of the Compensation
Committee are Mr. Hart and Mr. Jobe.
DIRECTOR COMPENSATION
Except for grants of stock options, directors of the Company generally do
not receive compensation for services provided as a director. The Company also
does not pay compensation for committee participation or special assignments
of the Board of Directors.
Non-employee Board members are eligible for option grants pursuant to the
provisions of the automatic grant program under the Company's 1997 Stock
Option Plan. Under the automatic grant program, each individual who becomes a
non-employee Board member will be granted an option to purchase 20,000 shares
on the date such individual joins the Board, provided such individual has not
been in the prior employ of the Company. In addition, at each annual
stockholders meeting, each individual who continues to serve and has served as
a non-employee Board member for at least six months prior to such Annual
Meeting receives an additional option grant to purchase 10,000 shares of
Common Stock, whether or not such individual is standing for re-election at
that particular meeting.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES LISTED HEREIN.
4
<PAGE>
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of September 1, 1998 certain information
with respect to shares beneficially owned by (i) each person who is known by
the Company to be the beneficial owner of more than five percent (5%) of the
Company's outstanding shares of Common Stock, (ii) each of the Company's
directors, and the executive officers named in the Summary Compensation Table
and (iii) all current directors and executive officers as a group. Beneficial
ownership has been determined in accordance with Rule 13d-3 under the Exchange
Act. Under this rule, certain shares may be deemed to be beneficially owned by
more than one person (if, for example, persons share the power to vote or the
power to dispose of the shares). In addition, shares are deemed to be
beneficially owned by a person if the person has the right to acquire shares
(for example, upon exercise of an option or warrant) within 60 days of the
date as of which the information is provided; in computing the percentage
ownership of any person, the amount of shares is deemed to include the amount
of shares beneficially owned by such person (and only such person) by reason
of such acquisition rights. As a result, the percentage of outstanding shares
of any person as shown in the following table does not necessarily reflect the
person's actual voting power at any particular date.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNERS OWNERSHIP (1)(2) CLASS
- ------------------------------------- ---------------- ----------
<S> <C> <C>
Beneficial Owners of more than five percent (5%)
of the Company's outstanding shares of Common
Stock:
Aspen Venture Partners
1000 Fremont Avenue, Suite V
Los Altos, CA 94024............................. 680,793 6.4%
H & Q London Ventures
One Bush Street
San Francisco, CA 94104......................... 631,172 6.0%
Technology Partners West Fund IV
1550 Tiburon Boulevard, Suite A
Belvedere, CA 94920............................. 771,729 7.3%
Directors and Executive Officers:
Richard G. Thau (3)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 712,000 6.5%
Bruce C. Felt (4)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 134,000 1.2%
Dan E. Kingman
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 60,000 *
David R. Malmstedt (5)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 224,300 2.1%
George J. Symons (6)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 62,911 *
Louis C. Cole (7)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402............................. 5,615 *
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNERS OWNERSHIP (1)(2) CLASS
- ------------------------------------- ---------------- ----------
<S> <C> <C>
Kenneth A. Goldman (8)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402.............................. 24,000 *
William Hart (9)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402.............................. 816,936 7.5%
William D. Jobe (10)
c/o Qualix Group, Inc.
177 Bovet Road, 2nd Floor
San Mateo, CA 94402.............................. 67,478 *
All current executive officers and directors as a
group (11 persons including those listed above).. 2,141,124 19.6%
</TABLE>
- --------
* Less than 1% of the outstanding shares of Common Stock.
(1) Except as indicated in the footnotes to this table and pursuant to
applicable community property laws, the persons named in the table have
sole voting and investment power with respect to all shares of Common
Stock. To the Company's knowledge, the entities named in the table have
sole voting and investment power with respect to all shares of Common
Stock shown as beneficially owned by them.
(2) Percentage of beneficial ownership is calculated assuming 10,601,284
shares of Common Stock were outstanding on September 1, 1998. The number
of shares of Common Stock deemed outstanding includes shares issuable
pursuant to stock options that may be exercised within sixty (60) days
after the record date. However, such Common Stock shall not be deemed
outstanding for the purpose of computing the percentage owned by any other
individual or entity. Such calculation is required by General Rule 13d-
3(1)(I) under the Securities Exchange Act of 1934.
(3) Includes 62,420 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(4) Includes 19,900 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(5) Includes 200,000 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(6) Includes 32,911 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(7) Includes 5,615 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(8) Includes 1,600 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(9) Includes 771,729 shares beneficially owned by Technology Partners West
Fund IV. Mr. Hart, a director of the Company, is a general partner of the
general partner of Technology Partners West Fund IV. Mr. Hart disclaims
beneficial ownership of all shares of Common Stock held by Technology
Partners West Fund IV, except to the extent of his pecuniary interest
therein. Includes 5,207 shares issuable pursuant to stock options that may
be exercised within sixty (60) days after the record date.
(10) Includes 6,671 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
(11) Includes 5,207 shares issuable pursuant to stock options that may be
exercised within sixty (60) days after the record date.
6
<PAGE>
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Company's Board of Directors (the
"Committee") has the authority to establish the level of base salary payable
to the Chief Executive Officer ("CEO") and the other executive officers and to
administer the Company's 1997 Stock Option Plan and Employee Stock Purchase
Plan. In addition, the Committee has the responsibility for approving the
individual bonus program to be in effect for the CEO and all other employees
of the Company, including all executive officers.
GENERAL COMPENSATION POLICY. The Company's fundamental policy is to offer the
Company's executive officers competitive compensation opportunities based upon
overall Company performance, their individual contribution to the financial
success of the Company and their personal performance. It is the Company's
objective to have a substantial portion of each officer's compensation
contingent upon the Company's performance, as well as upon his or her own
level of performance. Accordingly, each executive officer's compensation
package consists of: (i) base salary, (ii) cash bonus awards and (iii) long-
term stock-based incentive awards.
BASE SALARY. To date, base salary for each executive officer has generally
been set through individual negotiation at the time of hire. Periodic
increases have been awarded on the basis of personal performance.
ANNUAL CASH BONUSES. Each executive officer has an established bonus target
each fiscal year. The annual pool of bonuses for executive officers is
determined on the basis of the Company's achievement of the performance
targets established at the start of the fiscal year, which are generally
primarily financial performance targets. Each fiscal year, the annual
incentive plan is reevaluated with a new achievement threshold and new
targets. Actual bonuses paid reflect an individual's accomplishment of both
corporate and functional objectives, with greater weight being given to
achievement of corporate rather than functional objectives. Actual bonuses are
listed in the Summary Compensation Table.
LONG-TERM INCENTIVE COMPENSATION. Long-term incentives are provided through
stock option grants. The grants are designed to align the interests of each
executive officer with those of the stockholders and provide each individual
with a significant incentive to manage the Company from the perspective of an
owner with an equity stake in the business. Each grant generally allows the
officer to acquire shares of the Company's common stock at a fixed price per
share (the market price on the grant date) over a specified period of time (up
to 10 years). Generally, a significant grant is made in the year that an
officer commences employment. Smaller grants may be made in subsequent years
beginning the third year following initial grant or no options granted. During
fiscal 1998, the Committee made option grants to each of the Named Officers.
CEO COMPENSATION. The annual base salary for Mr. Thau, the Company's President
and CEO, remained unchanged in the 1998 fiscal year. The bonus paid to the CEO
for fiscal 1998 was based on the same incentive plan as for all other officers
as discussed above.
TAX LIMITATION. Under the Federal tax laws, a publicly-held company such as
the Company will not be allowed a Federal income tax deduction for
compensation paid to certain executive officers to the extent that
compensation exceeds $1 million per officer in any year. This limitation will
be in effect for all fiscal years of the Company ending after the Company's
initial public offering. The stockholders approved the Company's 1997 Stock
Option Plan, which includes a provision that limits the maximum number of
shares of Common Stock for which any one participant may be granted stock
options per calendar year. Accordingly, any compensation deemed paid to an
executive officer when he or she exercises an option under the 1997 Stock
Option Plan with an exercise price equal to the fair market value of the
option shares on the grant date generally will qualify as performance-based
compensation that will not be subject to the $1 million limitation. Since it
is not expected that the cash compensation to be paid to the Company's
executive officers for the 1998 fiscal year will exceed the $1 million limit
per officer, the Committee will defer any decision on whether to limit the
dollar amount of the cash compensation payable to the Company's executive
officers to the $1 million cap.
Compensation Committee
William Hart
William D. Jobe
7
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Company's Board of Directors was formed on
July 16, 1996, and the members of the Compensation Committee are Mr. Hart and
Mr. Jobe. Neither of these individuals was at any time during fiscal year 1998,
or at any other time, an officer or employee of the Company. No executive
officer of the Company serves as a member of the board of directors or
compensation committee of any entity that has one or more executive officers
serving as a member of the Company's Board of Directors or Compensation
Committee.
STOCK PERFORMANCE GRAPH
The graph set forth below compares the cumulative total stockholder return on
the Company's Common Stock between February 12, 1997 (the date the Company's
Common Stock commenced public trading) and June 30, 1998 with the cumulative
total return of (i) the Total Return Index for the Nasdaq Stock Market (U.S.
Companies) (the "Nasdaq Stock Market U.S. Index") and (ii) the Hambrecht &
Quist Software Sector Index (the "H&Q Software Sector Index"), over the same
period. This graph assumes the investment of $100.00 on February 12, 1997 in
the Company's Common Stock, the Nasdaq Stock Market U.S. Index and the H&Q
Software Sector Index, and assumes the reinvestment of dividends, if any.
The comparisons shown in the graph below are based upon historical data. The
Company cautions that the stock price performance shown in the graph below is
not indicative of, nor intended to forecast, the potential future performance
of the Company's Common Stock. Information used in the graph was obtained from
Hambrecht & Quist LLC, a source believed to be reliable, but the Company is not
responsible for any errors or omissions in such information.
PERFORMANCE CHART APPEARS HERE
<TABLE>
<CAPTION>
2/12/97 MAR-97 JUN-97 SEP-97 DEC-97 MAR-98 JUN-98
------- ------ ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Qualix Group, Inc....... $100.00 $68.75 $ 75.00 $ 57.81 $ 37.11 $ 42.96 $ 24.22
Nasdaq Stock Market-U.S.
Index.................. $100.00 $89.85 $106.32 $124.30 $116.56 $136.35 $140.28
H&Q Software Sector
Index.................. $100.00 $89.12 $105.84 $126.91 $118.08 $153.28 $158.88
</TABLE>
The Company effected its initial public offering of Common Stock on February
12, 1997 at a price of $8.00 per share.
Notwithstanding anything to the contrary set forth in any of the Company's
previous or future filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate this Proxy
Statement or future filings made by the Company under those statutes, the
Compensation Committee Report and Stock Performance Graph shall not be deemed
filed with the Securities and Exchange Commission and shall not be deemed
incorporated by reverence into any of those prior filings or into any future
filings made by the Company under those statutes.
8
<PAGE>
EXECUTIVE COMPENSATION AND RELATED INFORMATION
The following Summary Compensation Table sets forth the compensation earned
by the Company's Chief Executive Officer and the three other most highly
compensated executive officers who were serving as such at the end of fiscal
year 1998 (collectively, the "Named Officers"), each of whose aggregate
compensation for fiscal year 1998 exceeded $100,000, for services rendered in
all capacities to the Company and its subsidiaries for the 1997 and 1998
fiscal years. Also included is the compensation for two former employees of
the Company who served as executive officers during fiscal 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
----------------------------- ----------------------
NAME AND PRINCIPAL NUMBER OF SECURITIES ALL OTHER
POSITION FISCAL YEAR SALARY ($)(1) BONUS ($)(1)(2) UNDERLYING OPTIONS (#) COMPENSATION
- ------------------ ----------- ------------- --------------- ---------------------- ------------
<S> <C> <C> <C> <C> <C>
Richard G. Thau......... 1998 $190,000 $90,644 -- 11,400
President and Chief 1997 180,292 81,852 50,000 7,680
Executive Officer 1996 150,000 62,206 70,000 --
David Malmstedt......... 1998 96,970 84,388 200,000 --
Senior Vice President, 1997 -- -- -- --
Field Sales
Operations(3) 1996 -- -- -- --
Bruce C. Felt........... 1998 124,500 31,063 30,000 --
Vice President, Finance
and 1997 102,099 61,718 16,000 --
Chief Financial Officer 1996 90,834 17,777 20,000 --
Arlington C. Glaze...... 1998 55,359 45,415 -- --
Former Vice President 1997 96,249 172,674 26,500 --
Sales(4) 1996 77,499 88,746 30,000 --
George J. Symons........ 1998 130,000 32,678 30,000 --
Vice President,
Engineering/ 1997 108,772 39,312 -- --
Technical Services(5) 1996 22,500 8,711 32,581 --
David P. Crocker........ 1998 87,500 69,803 30,000 --
Former President,
Octopus 1997 198,388 83,473 40,000 --
Technologies
Division(6) 1996 87,116 -- 41,568 --
</TABLE>
- --------
(1) Includes amounts deferred under the Company's 401(k) plan.
(2) Bonus amounts include commissions earned in the respective fiscal years.
(3) Mr. Malmstedt joined the Company in January 1998.
(4) Mr. Glaze terminated employment with the Company in January 1998.
(5) Mr. Symons commenced employment with the Company in April 1996.
(6) Mr. Crocker terminated employment with the Company in March 1998.
9
<PAGE>
The following table contains information concerning the stock option grants
made to each of the Named Officers during the fiscal year ended June 30, 1998.
No stock appreciation rights were granted to these individuals during such
fiscal year.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS (1) OPTION TERM (4)
--------------------- ----------------
NUMBER OF
SECURITIES PERCENT OF
UNDERLYING TOTAL OPTIONS EXERCISE
OPTIONS GRANTED TO EMPLOYEES PRICE PER EXPIRATION
NAME GRANTED (#) IN FISCAL 1998 (2) SHARE ($/SH)(3) DATE 5% ($) 10% ($)
- ---- ----------- --------------------- --------------- ---------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
David Malmstedt......... 200,000 12% $2.750 1/23/08 $345,892 876,558
Bruce C. Felt........... 30,000 2% $2.750 1/23/08 51,884 131,484
George J. Symons........ 30,000 2% $2.750 1/23/08 51,884 131,484
David P. Crocker........ 30,000 2% $2.750 1/23/08 51,884 131,484
</TABLE>
- --------
(1) Each of the options is immediately exercisable. The shares purchasable
thereunder are subject to repurchase by the Company at the original
exercise price paid per share upon the optionee's cessation of service
prior to vesting in such shares. The repurchase right lapses as to 25% of
the shares upon completion of one year of service from the grant date and
the balance in a series of 36 monthly installments thereafter.
(2) Based on an aggregate of 1,655,658 options granted in the 1998 fiscal
year.
(3) The exercise price may be paid in cash, in shares of Common Stock valued
at fair market value on the exercise date or through a cashless exercise
procedure involving a same-day sale of the purchased shares. The Company
may also finance the option exercise by loaning the optionee sufficient
funds to pay the exercise price for the purchased shares, together with
any federal and state income tax liability incurred by the optionee in
connection with such exercise.
(4) The 5% and 10% assumed annual rates of compounded stock price appreciation
are mandated by rules of the Securities and Exchange Commission. There can
be no assurance provided to any executive officer or any other holder of
the Company's securities that the actual stock price appreciation over the
10-year option term will be at the assumed 5% and 10% levels or at any
other defined level. Unless the market price of the Common Stock
appreciates over the option term, no value will be realized from the
option grants made to the executive officers.
10
<PAGE>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAREND OPTION VALUES
The following table sets forth, as to the Named Officers, certain
information concerning stock options exercised during fiscal 1998 and the
number of shares subject to both exercisable and unexercisable stock options
as of June 30, 1998. Also reported are values for unexercised "in-the-money"
options, exercise prices of outstanding stock options and the fair market
value of the Company's Common Stock as of June 30, 1998.
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS INTHEMONEY OPTIONS AT
AT FISCAL YEAREND (#) FISCAL YEAREND ($)(2)
------------------------- -------------------------
SHARES
ACQUIRED ON
EXERCISE VALUE
NAME (#) REALIZED ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Richard G. Thau......... 25,000 $ 64,530 30,722 31,698 $16,339 $5,247
David R. Malmstedt...... -- -- -- 200,000 -- --
Bruce C. Felt........... 16,100 42,007 4,233 45,667 -- 11,278
George J. Symons........ -- -- 19,026 44,174 33,067 24,634
David P. Crocker........ -- -- 55,707 69,717 16,807 --
Arlington C. Glaze...... 47,163 128,866 -- -- -- --
</TABLE>
- --------
(1) Market value of underlying securities based on the closing price of the
Company's Common Stock on the date of exercise minus the exercise price.
(2) Market value of underlying securities based on the closing price of the
Company's Common Stock on June 30, 1998 (the last trading day of fiscal
1998) on the Nasdaq National Market of $1.938 minus the exercise price.
EMPLOYMENT CONTRACTS AND CHANGE IN CONTROL ARRANGEMENTS
Except as follows, none of the Named Officers have employment agreements
with the Company, and their employment may be terminated at any time: The
Company has entered into agreements with Mr. Thau, Chairman of the Board,
President and Chief Executive Officer, Mr. Malmstedt, Senior Vice President of
Field Sales Operations and Mr. Felt, Vice President, Finance and Chief
Financial Officer. Mr. Thau's employment agreement provides for severance
payments equal to 50% and 25% of his annual base compensation if he is
terminated without cause or in certain other circumstances. Mr. Felt's
employment agreement provides that upon termination without cause, he shall
continue to be paid during the 90-day period after the date of termination at
his then current base salary rate and receive 12 months' additional vesting
(and lapse of the repurchase right) of options granted (and shares of Common
Stock purchased) pursuant to his employment agreement. Mr. Malmstedt's
agreement provides for a base salary of $200,000 annually, a sign-on bonus of
$25,000 plus a first year bonus plan guaranteeing a payment of not less than
$50,000; a bonus of up to $100,000 may be earned if certain goals are
achieved. Should Mr. Malmstedt voluntarily resign or be terminated for cause
during his first year of employment with the Company, he will be required to
reimburse the Company for the sign-on bonus and any relocation expenses that
may have been paid to him.
The Compensation Committee of the Board of Directors, as Plan Administrator
of the 1997 Stock Option Plan, has the authority to provide for accelerated
vesting of the shares of Common Stock subject to outstanding options held by
the Named Officers and any other executive officer or director in connection
with certain changes in control of the Company or the Company or the
subsequent termination of the officer's employment following the change in
control event.
11
<PAGE>
PROPOSAL NO. 2
AMENDMENT OF THE COMPANY'S CERTIFICATE OF INCORPORATION TO CHANGE
THE NAME OF THE COMPANY
In May 1998, the Board of Directors unanimously adopted a resolution
approving an amendment of the Company's Certificate of Incorporation to change
the Company's name to "FullTime Software, Inc." Pursuant to the proposed
amendment, Article I of the Company's Certificate of Incorporation would be
amended and restated to read as follows:
"The name of this corporation is FullTime Software, Inc."
The Company's stockholders are being asked to approve this amendment. The
Board believes it is in the best interest of the Company to change its name to
reflect the Company's new business objective of becoming the leading provider
of adaptive computing solutions that maximize service level availability
reliability and efficiency of applications. In light of the foregoing, the
Company has been doing business as FullTime Software, Inc. since July 7, 1998.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE AMENDMENT
OF THE COMPANY'S CERTIFICATE OF INCORPORATION TO CHANGE THE NAME OF THE
COMPANY TO "FULLTIME SOFTWARE, INC."
PROPOSAL NO. 3
APPROVAL OF THE 1998 EMPLOYEE STOCK PURCHASE PLAN
As a result of a recent change in the financial accounting rules regarding
employee stock purchase plans, the Board of Directors determined that it is in
the best interests of the Company and its stockholders to allow the current
1997 Employee Stock Purchase Plan to terminate and to adopt a new 1998
Employee Stock Purchase Plan ("Purchase Plan") (described below). In
September, 1998, the Board of Directors adopted the Purchase Plan and reserved
300,000 shares of Common Stock for issuance thereunder subject to stockholder
approval. As of the date of stockholder approval of the Purchase Plan, no
options had been granted pursuant to the Purchase Plan.
At the annual meeting, the stockholders are being asked to approve the
Purchase Plan and the reservation of shares thereunder.
SUMMARY OF THE PURCHASE PLAN
GENERAL. The purpose of the Purchase Plan is to provide employees with an
opportunity to purchase Common Stock of the Company through payroll
deductions.
ADMINISTRATION. The Purchase Plan may be administered by the Board of
Directors (the "Board") or a committee appointed by the Board. All questions
of interpretation or application of the Purchase Plan are determined by the
Board or its appointed committee, and its decisions are final, conclusive and
binding upon all participants.
ELIGIBILITY. Each employee of the Company (including officers), whose
customary employment with the Company is at least twenty (20) hours per week
and more than five (5) months in any calendar year, is eligible to participate
in an Offering Period (as defined below); provided, however, that no employee
shall be granted an option under the Purchase Plan (i) to the extent that,
immediately after the grant, such employee would own 5% of either the voting
power or value of the stock of the Company, or (ii) to the extent that his or
her rights to purchase stock under all employee stock purchase plans of the
Company accrues at a rate which
12
<PAGE>
exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at
the fair market value of the shares at the time such option is granted) for
each calendar year. Eligible employees become participants in the Purchase
Plan by filing with the Company a subscription agreement authorizing payroll
deductions prior to the beginning of each Offering Period unless a later time
for filing the subscription agreement has been set by the Board.
PARTICIPATION IN AN OFFERING. The Purchase Plan is implemented by
consecutive overlapping offering periods lasting for twenty-four months (an
"Offering Period"), with a new Offering Period commencing on March 1
(beginning in 2000) and September 1 (beginning in 1999) of each year. Common
Stock may be purchased under the Purchase Plan every six (6) months (a
"Purchase Period"), unless the participant withdraws or terminates employment
earlier. To the extent the fair market value of the Common Stock on any
exercise date in an Offering Period is lower than the fair market value of the
Common Stock on the first day of the Offering Period, then all participants in
such Offering Period will be automatically withdrawn from such Offering Period
immediately after the exercise of their options on such exercise date and
automatically re-enrolled in the immediately following Offering Period as of
the first day thereof. The Board may change the duration of the Purchase
Periods or the length or date of commencement of an Offering Period. To
participate in the Purchase Plan, each eligible employee must authorize
payroll deductions pursuant to the Purchase Plan. Such payroll deductions may
not exceed 15% of a participant's compensation. Once an employee becomes a
participant in the Purchase Plan, the employee will automatically participate
in each successive Offering Period until such time as the employee withdraws
from the Purchase Plan or the employee's employment with the Company
terminates. At the beginning of each Offering Period, each participant is
automatically granted options to purchase shares of the Company's Common
Stock. The option expires at the end of the Purchase Period or upon
termination of employment, whichever is earlier, but is exercised at the end
of each Purchase Period to the extent of the payroll deductions accumulated
during such Purchase Period. The number of shares subject to the option may
not exceed 5,000 shares of the Company's Common Stock on the first day of the
Purchase Period.
PURCHASE PRICE, SHARES PURCHASED. Shares of Common Stock may be purchased
under the Purchase Plan at a price not less than 85% of the lesser of the fair
market value of the Common Stock on (i) the first day of the Offering Period
or (ii) the last day of Purchase Period. The "fair market value" of the Common
Stock on any relevant date will be the closing price per share as reported on
The Nasdaq National Market (or the mean of the closing bid and asked prices,
if no sales were reported) as quoted on such exchange or reported in The Wall
Street Journal. The number of shares of Common Stock a participant purchases
in each Purchase Period is determined by dividing the total amount of payroll
deductions withheld from the participant's compensation during that Purchase
Period by the purchase price.
TERMINATION OF EMPLOYMENT. Termination of a participant's employment for any
reason, including disability or death, or the failure of the participant to
remain in the continuous scheduled employ of the Company for at least 20 hours
per week, cancels his or her option and participation in the Purchase Plan
immediately. In such event, the payroll deductions credited to the
participant's account will be returned to him or her or, in the case of death,
to the person or persons entitled thereto as provided in the Purchase Plan.
ADJUSTMENT UPON CHANGE IN CAPITALIZATION. In the event that the stock of the
Company is changed by reason of any stock split, reverse stock split, stock
dividend, combination, reclassification or other change in the capital
structure of the Company effected without the receipt of consideration,
appropriate proportional adjustments shall be made in the number and class of
shares of stock subject to the Purchase Plan, the number and class of shares
of stock subject to options outstanding under the Purchase Plan, and the
exercise price of any such outstanding options. Any such adjustment shall be
made by the Board, whose determination shall be conclusive.
DISSOLUTION OR LIQUIDATION. In the event of a proposed dissolution or
liquidation, the offering period then in progress will be shortened and a new
exercise date will be set.
MERGER OR ASSET SALE. In the event of a merger of the Company with or into
another corporation or a sale of substantially all of the Company's assets,
each outstanding option may be assumed or substituted for
13
<PAGE>
by the successor corporation. If the successor corporation refuses to assume
or substitute for the outstanding options, the offering period then in
progress will be shortened and a new exercise date will be set.
AMENDMENT AND TERMINATION OF THE PLAN. The Board of Directors has the
authority to amend or terminate the 1998 Purchase Plan, except that no such
action may adversely affect any outstanding rights to purchase stock under the
1998 Purchase Plan, provided that the Board of Directors may terminate an
offering period on any exercise date if the Board determines that the
termination of the 1998 Purchase Plan is in the best interests of the Company
and its stockholders. Notwithstanding anything to the contrary, the Board of
Directors may in its sole discretion amend the 1998 Purchase Plan to the
extent necessary and desirable to avoid unfavorable financial accounting
consequences by altering the purchase price for any offering period,
shortening any offering period or allocating remaining shares among the
participants. The 1998 Purchase Plan will terminate in September 2008, unless
sooner terminated by the Board of Directors.
WITHDRAWAL. Generally, a participant may withdraw from an Offering Period at
any time without affecting his or her eligibility to participate in future
Offering Periods. However, once a participant withdraws from a particular
offering, that participant may not participate again in the same offering.
FEDERAL TAX INFORMATION FOR PURCHASE PLAN. The Purchase Plan, and the right
of participants to make purchases thereunder, is intended to qualify under the
provisions of Sections 421 and 423 of the Code. Under these provisions, no
income will be taxable to a participant until the shares purchased under the
Purchase Plan are sold or otherwise disposed of. Upon sale or other
disposition of the shares, the participant will generally be subject to tax
and the amount of the tax will depend upon the holding period. If the shares
are sold or otherwise disposed of more than two (2) years from the first day
of the Offering Period and more than one (1) year from the date of transfer of
the stock to the participant, then the participant will recognize ordinary
income measured as the lesser of (i) the excess of the fair market value of
the shares at the time of such sale or disposition over the purchase price, or
(ii) an amount equal to 15% of the fair market value of the shares as of the
first day of the Offering Period. Any additional gain will be treated as long-
term capital gain. Net capital gains on shares held for more than 12 months
may be taxed at a maximum federal rate of 20%. If the shares are sold or
otherwise disposed of before the expiration of these holding periods, the
participant will recognize ordinary income generally measured as the excess of
the fair market value of the shares on the date the shares are purchased over
the purchase price. Any additional gain or loss on such sale or disposition
will be long-term or short-term capital gain or loss, depending on the holding
period. Unless limited by Section 162(m) of the Code, the Company is not
entitled to a deduction for amounts taxed as ordinary income or capital gain
to a participant except to the extent of ordinary income is recognized by
participants upon a sale or disposition of shares prior to the expiration of
the holding period(s) described above.
THE FOREGOING IS ONLY A SUMMARY OF THE EFFECT OF FEDERAL INCOME TAXATION
UPON THE PARTICIPANT AND THE COMPANY WITH RESPECT TO THE SHARES PURCHASED
UNDER THE PURCHASE PLAN. REFERENCE SHOULD BE MADE TO THE APPLICABLE PROVISIONS
OF THE CODE. IN ADDITION, THE SUMMARY DOES NOT DISCUSS THE TAX CONSEQUENCES OF
A PARTICIPANT'S DEATH OR THE INCOME TAX LAWS OF ANY STATE OR FOREIGN COUNTRY
IN WHICH THE PARTICIPANT MAY RESIDE.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE 1998
EMPLOYEE STOCK PURCHASE PLAN.
14
<PAGE>
PROPOSAL NO. 4
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Company is asking the stockholders to ratify the appointment of Deloitte
& Touche LLP as the Company's independent public accountants for the fiscal
year ending June 30, 1999. In the event the stockholders fail to ratify the
appointment, the Board of Directors will reconsider its selection. Even if the
appointment is ratified, the Board of Directors, in its discretion, may direct
the appointment of a different independent accounting firm at any time during
the year if the Board of Directors feels that such a change would be in the
Company's and its stockholders' best interests. Representatives of Deloitte &
Touche LLP are expected to be present at the Annual Meeting, will have the
opportunity to make a statement if they desire to do so, and will be available
to respond to appropriate questions.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
SELECTION OF DELOITTE & TOUCHE LLP TO SERVE AS THE COMPANY'S INDEPENDENT
PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING JUNE 30, 1999.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The members of the Board of Directors, the executive officers of the Company
and persons who hold more than 10% of the Company's outstanding Common Stock
are subject to the reporting requirements of Section 16(a) of the Securities
Exchange Act of 1934, as amended, which require them to file reports with
respect to their ownership of the Company's Common Stock and their
transactions in such Common Stock. Based upon (i) the copies of Section 16(a)
reports that the Company received from such persons for their fiscal year 1998
transactions in the Common Stock and their Common Stock holdings and (ii) the
written representations received from one or more of such persons that no
annual Form 5 reports were required to be filed by them for fiscal year 1998,
the Company believes that all reporting requirements under Section 16(a) for
such fiscal year were met in a timely manner by its executive officers, Board
members and greater than 10% stockholders.
FORM 10-K
THE COMPANY WILL MAIL WITHOUT CHARGE, UPON WRITTEN REQUEST, A COPY OF THE
COMPANY'S FORM 10-K REPORT FOR FISCAL 1998, INCLUDING THE FINANCIAL
STATEMENTS, SCHEDULES AND LIST OF EXHIBITS. REQUESTS SHOULD BE SENT TO QUALIX
GROUP, INC., 177 BOVET ROAD, SAN MATEO, CALIFORNIA 94402, ATTN: INVESTOR
RELATIONS.
STOCKHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
Stockholder proposals that are intended to be presented at the 1999 Annual
Meeting that are eligible for inclusion in the Company's proxy statement and
related proxy materials for that meeting under the applicable rules of the
Securities and Exchange Commission must be received by the Company not later
than June 16, 1999 in order to be included. Such stockholder proposals should
be addressed to Qualix Group, Inc., 177 Bovet Road, 2nd Floor, San Mateo,
California, Attn: Investor Relations.
15
<PAGE>
OTHER MATTERS
As of the date of this proxy, the Board knows of no other matters to be
presented for stockholder action at the Annual Meeting. However, if other
matters do properly come before the Annual Meeting or any adjournments or
postponements thereof, the Board intends that the persons named in the proxies
will vote upon such matters in accordance with their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
Bruce C. Felt
Secretary
San Mateo, California
October , 1998
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE
ANNUAL MEETING. IF YOU DECIDE TO ATTEND THE ANNUAL MEETING AND WISH TO
CHANGE YOUR PROXY VOTE, YOU MAY DO SO AUTOMATICALLY BY VOTING IN PERSON AT
THE MEETING.
THANK YOU FOR YOUR ATTENTION TO THIS MATTER. YOUR PROMPT RESPONSE WILL
GREATLY FACILITATE ARRANGEMENTS FOR THE ANNUAL MEETING.
16
<PAGE>
P
R
O
X
Y
QUALIX GROUP, INC.
1998 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Qualix Group, Inc., a Delaware
corporation, hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders and Proxy Statement, each dated October ___, 1998 and hereby
appoints Richard Thau and Bruce Felt, or either of them, proxies and
attorney-in-fact, with full power to each of substitution, on behalf and in
the name of the undersigned, to represent the undersigned at the 1998 Annual
Meeting of Stockholders of Qualix Group, Inc. to be held on November 16, 1998,
at 10:00 am, local time, at 177 Bovet Road, Second Floor, San Mateo, CA 94402,
and at any adjournment(s) thereof, and to vote all shares of Common Stock
which the undersigned would be entitled to vote if then and there personally
present, on the matters set forth on the reverse side, and, in their
discretion, upon such other matter or matters which may properly come before
the meeting and any adjournment(s) thereof.
This proxy will be voted as directed or, if no contrary direction is
indicated, will be voted FOR the election of the specified nominees as
---
director, FOR the amendment to the Certificate of Incorporation to change the
---
Company's name to "FullTime Software, Inc.", FOR the approval of the 1998
---
Employee Stock Purchase Plan and FOR the ratification of Deloitte & Touche LLP
---
as independent accountants for the fiscal year ended June 30, 1999, and as said
proxies deem advisable on such other matters as may properly come before the
meeting.
_____________
CONTINUED AND TO BE SIGNED ON REVERSE SIDE |SEE REVERSE|
| SIDE |
|___________|
________________________________________________________________________________
<TABLE>
<CAPTION>
P
R
O
X
Y
Please mark
_________________________________________
| X |
|_______________________________________|
<S> <C> <C> <C> <C>
votes as in
this example FOR AGAINST ABSTAIN
PROPOSAL TO ELECT RICHARD G. THAU,
LOUIS C. COLE, KENNETH A. GOLDMAN,
WILLIAM HART, WILLIAM D. JOBE AND [_] [_] [_]
PETER L. WOLKEN AS DIRECTORS TO
SERVE FOR A ONE YEAR TERM THAT
EXPIRES UPON THE ANNUAL MEETING OF
STOCKHOLDERS IN 1999, OR UNTIL THEIR
SUCCESSORS ARE DULY ELECTED.
FOR AGAINST ABSTAIN
PROPOSAL TO APPROVE AN AMENDMENT TO
THE COMPANY'S CERTIFICATE OF
INCORPORATION TO CHANGE THE COMPANY'S [_] [_] [_]
NAME TO FULLTIME SOFTWARE, INC.
FOR AGAINST ABSTAIN
PROPOSAL TO APPROVE THE 1998 EMPLOYEE
STOCK PURCHASE PLAN. [_] [_] [_]
FOR AGAINST ABSTAIN
PROPOSAL TO RATIFY THE APPOINTMENT OF
DELOITTE & TOUCHE LLP AS THE INDEPENDENT
ACCOUNTANTS OF THE COMPANY. [_] [_] [_]
In their discretion upon such other matter or matters which may properly come before the
meeting and any adjournment(s) thereof.
MARK HERE This Proxy should be marked, dated, signed by the shareholder(s) exactly as his or her name
FOR ADDRESS appears hereon, and returned promptly in the enclosed envelope. Persons signing in a
CHANGE AND ____ fiduciary capacity should so indicate. If shares are held by joint tenants or as community
NOTE BELOW | | property, both should sign.
|__|
Signature: Date:
______________________ ________
Signature: Date:
______________________ ________
</TABLE>
