As filed with the Securities and Exchange Commission on September 16, 1997
Registration No. 333-[______]
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
Dendrite International, Inc.
(Exact Name of Registrant as Specified in Its Charter)
New Jersey
(State or Other Jurisdiction of Incorporation or Organization)
22-2786386
(I.R.S. Employer Identification Number)
1200 Mount Kemble Avenue, Morristown, New Jersey 07960-6797
Telephone: (201) 425-1200
(Address of Principal Executive Offices) (Zip Code)
Dendrite International, Inc.
1997 Stock Incentive Plan
(Full Title of the Plan)
Christopher J. French
Vice President, General Counsel and Secretary
Dendrite International, Inc.
1200 Mount Kemble Avenue
Morristown, New Jersey 07960-6797
(Name and Address of Agent for Service)
(201) 425-1200
(Telephone Number, Including Area Code, of Agent for Service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
================================ ================================ ================= ================ ==============
<S> <C> <C> <C> <C>
Proposed Proposed
Maximum Maximum Amount of
Title of Each Class of Offering Price Aggregate Registration
Securities to be Registered Amount to be Registered Per Share(1) Offering Price Fee
- -------------------------------- -------------------------------- ----------------- ---------------- --------------
Common Stock, no par value 500,000 $18.1875 $9,093,750. $2,756.
================================ ================================ ================= ================ ==============
<FN>
(1) Calculated solely for the purpose of determining the registration fee
pursuant to Rule 457(c) based upon the average of the high and low sales
prices of the Company's Common Stock, as quoted through the NASDAQ National
Market, on September 15, 1997.
</FN>
</TABLE>
<PAGE>
PART I
- --------------------------------------------------------------------------------
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
EXPLANATORY NOTE
As permitted by Rule 428 under the Securities Act of 1933, as amended (the
"Securities Act"), this registration statement omits the information specified
in Part I of Form S-8. The documents containing the information specified in
Part I will be delivered to the participants in the plan covered by this
registration statement as required by Rule 428(b). Such documents are not being
filed with the Securities and Exchange Commission (the "Commission") as part of
this registration statement or as prospectuses or prospectus supplements
pursuant to Rule 424 of such Act.
I-2
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents By Reference
The following documents filed with the Commission by the registrant,
Dendrite International, Inc., a New Jersey corporation (the "Company"), pursuant
to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
incorporated by reference in this registration statement.
1. The Company's Annual Report on Form 10-K for the year ended December 31,
1996 filed with the Commission on March 31, 1997.
2. The Company's Quarterly Reports on Form 10-Q for the quarter ended March
31, 1997 and June 30, 1997 filed with the Commission May 15, 1997, as amended
May 16, 1997 and August 15, 1997, respectively.
3. The description of the Company's Common Stock, no par value ("Common
Stock") contained in the Company's Registration Statement on Form 8-A filed with
the Commission on May 24, 1995.
4. The description of the Common Stock contained in the Company's Amendment
No. 1 to the Registration Statement on Form 8-A filed with the Commission on
June 9, 1995.
5. The description of the Common Stock contained in the Company's Amendment
No. 2 to the Registration Statement on Form 8-A filed with the Commission on
June 21, 1995.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all shares of Common Stock offered hereby have
been sold or which deregisters all such shares then remaining unsold, shall be
deemed to be incorporated by reference in this registration statement and to be
a part hereof from the date of filing of such documents. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this registration
statement to the extent that a statement contained herein or in any other
subsequently filed document which also is incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this registration statement.
Item 4. Description of Securities
Not applicable.
II-1
<PAGE>
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
Section 14A:3-5 of the New Jersey Business Corporation Act ("NJBCA") gives
the Company power to indemnify each of its directors and officers against
expenses and liabilities in connection with any proceeding involving him by
reason of his being or having been a director or officer if (a) he acted in good
faith and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the Company and (b) with respect to any criminal proceeding,
he had no reasonable cause to believe his conduct was unlawful. However, in a
proceeding by or in the right of the Company, there shall be no indemnification
in respect of any liabilities or expenses if the officer or director shall have
been adjudged liable to the Company unless the court in such proceeding
determines he is entitled to indemnification for such liabilities and/or
expenses. Furthermore, no indemnification shall be made to or on behalf of a
director or officer if a judgment or other final adjudication adverse to such
director or officer establishes that his acts or omissions (a) were in breach of
his duty of loyalty to the Company and its stockholders, (b) were not in good
faith or involved a knowing violation of law or (c) resulted in receipt by the
director or officer of an improper personal benefit. The NJBCA defines an act or
omission in breach of a person's duty of loyalty as an act or omission which
that person knows or believes to be contrary to the best interests of the
Company or its stockholders in connection with a matter in which he has a
material conflict of interest. If a director or officer is successful in a
proceeding, the statute mandates that the Company indemnify him against
expenses.
The Company's Restated Certificate of Incorporation, as permitted by New
Jersey law, eliminates the personal liability of the directors and officers to
the Company or its shareholders for monetary damages for breaches of such
director's or officer's duty of care or other duties as a director or officer;
except liabilities for any breach of duty based upon an act or omission (a) in
breach of such person's duty of loyalty to the corporation or its shareholders,
(b) not in good faith or involving a knowing violation of law or (c) resulting
in receipt by such person of an improper personal benefit. In addition, the
Company's Restated By-laws provide broad indemnification rights to directors and
officers so long as the director or officer acted in a manner believed in good
faith to be in or not opposed to the best interest of the Company and with
respect to criminal proceedings if the director had no reasonable cause to
believe his or her conduct was unlawful. The Company believes that the
protection provided by these provisions will help the Company attract and retain
qualified individuals to serve as officers and directors. These provisions also
will limit the remedies available to a stockholder who is dissatisfied with a
Board decision protected by these provisions, and such stockholder's only remedy
may be to bring a suit to prevent the Board's action.
The Company maintains a directors' and officers' liability insurance
policy.
II-2
<PAGE>
Item 7. Exemption from Registration Claimed
Not Applicable
Item 8. Exhibits
Exhibit
No. Description
3.1 Restated Certificate of Incorporation of the Company dated November 30,
1995 (incorporated by reference to Exhibit 3.1 to the Company's July 30,
1996 Quarterly Report on Form 10-Q, filed with the Commission on August 15,
1996).
3.2 By-laws of the Company, as amended (incorporated herein by reference to
Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1995, filed with the Commission on November 13, 1995).
4.1 Specimen of Stock Certificate (incorporated by reference to Exhibit 4.1 to
the Company's Registration Statement on Form S-1 filed with the Commission
on May 17, 1995).
4.2 The Dendrite International, Inc. 1997 Stock Incentive Plan (the "Stock
Plan") dated July 24, 1997.
5.1 Opinion of Sullivan & Cromwell as to the validity of Common Stock, no par
value, issued under the Stock Plan.
23.1 Consent of Sullivan & Cromwell (contained in Exhibit 5.1 attached hereto).
23.2 Consent of Arthur Andersen LLP, independent public accountants.
24.1 Power of Attorney is included in the signature page of the Registration
Statement.
Item 9. Required 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 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;
(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; and
II-3
<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) 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 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 Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE>
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, hereunto duly
authorized, in the Township of Harding, State of New Jersey, on the 16th day of
September, 1997.
DENDRITE INTERNATIONAL, INC.
By : /s/ John E. Bailye
John E. Bailye
Chief Executive Officer,
President and Director
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints John E. Bailye and George T.
Robson, and each of them acting individually, as his attorneys-in-fact and
agents, each with full power of substitution, for him in any and all capacities,
to sign the Registration Statement on Form S-8 of Dendrite International, Inc.
and any and all amendments thereto under the Securities Act of 1933, including
any and all pre-effective or post-effective amendments, and to file the same,
with exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto 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 as he
might or could do in person, and hereby ratifies, approves and confirms all that
his said attorneys-in-fact and agents, each acting alone, or his 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:
Name Title Date
---- ----- ----
/s/ John E. Bailye Chief Executive Officer,
- ------------------------- President and Director September 16, 1997
John E. Bailye
/s/ George T. Robson Senior Vice President and
- ------------------------- Chief Financial Officer September 16, 1997
George T. Robson
/s/ Bernard M. Goldsmith Director September 16, 1997
- -------------------------
Bernard M. Goldsmith
/s/ John H. Martinson Director September 16, 1997
- -------------------------
John H. Martinson
II-5
<PAGE>
/s/ Paul A. Margolis Director September 16, 1997
- -------------------------
Paul A. Margolis
Director
- -------------------------
Edward J. Kfoury
II-6
<PAGE>
EXHIBIT INDEX
Exhibits
No. Description
- -------- -----------
3.1 Restated Certificate of Incorporation of the Company dated November
30, 1995 (incorporated by reference to Exhibit 3.1 to the Company's
June 30, 1996 Quarterly Report on Form 10-Q, filed with the
Commission on August 15, 1996).
3.2 By-laws of the Company, as amended (incorporated herein by reference
to Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1995, filed with the Commission on
November 13, 1995).
4.1 Specimen of Stock Certificate (incorporated by reference to Exhibit
4.1 to the Company's Registration Statement on Form S-1 filed with
the Commission on May 17, 1995).
4.2 The Dendrite International, Inc. 1997 Stock Incentive Plan dated
July 24, 1997.
5.1 Opinion of Sullivan & Cromwell as to the validity of the Common
Stock issued under the Stock Plan.
23.1 Consent of Sullivan & Cromwell (contained in Exhibit 5.1 attached
hereto).
23.2 Consent of Arthur Andersen LLP, independent public accountants.
24.1 Power of Attorney is included in the signature page of the
Registration Statement.
EXHIBIT 4.2
DENDRITE INTERNATIONAL, INC.
1997 STOCK INCENTIVE PLAN
1. Purpose. The purpose of the Dendrite International, Inc. 1997 Stock
Incentive Plan (the "Plan") is to enhance the ability of Dendrite International,
Inc. (the "Company") and its subsidiaries to attract and retain employees and
directors of outstanding ability and to provide employees and directors with an
interest in the Company parallel to that of the Company's shareholders.
2. Definitions.
(a) "Award" shall mean an award determined in accordance with the terms
of the Plan.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Change in Control" shall mean the occurrence of any one of the
following events:
(i) any "person" (as such term is defined in Section 3(a)(9) of
the Exchange Act and as used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) is or becomes a "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the
Company representing 33-1/3% or more of the combined voting power of the
Company's then outstanding securities eligible to vote for the election of
the Board (the "Company Voting Securities"); provided, however, that the
event described in this paragraph (i) shall not be deemed to be a Change in
Control by virtue of any
<PAGE>
of the following acquisitions: (A) by the Company or any subsidiary, (B) by
any employee benefit plan sponsored or maintained by the Company or any
subsidiary, (C) by any underwriter temporarily holding securities pursuant
to an offering of such securities, (D) pursuant to a Non-Control
Transaction (as defined in paragraph (iii)), or (E) a transaction (other
than one described in (iii) below) in which Company Voting Securities are
acquired from the Company, if a majority of the Incumbent Board (as defined
below) approves a resolution providing expressly that the acquisition
pursuant to this clause (E) does not constitute a Change in Control under
this paragraph (i);
(ii) individuals who, on the Effective Date, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a
majority thereof, provided that any person becoming a director subsequent
to the Effective Date, whose election or nomination for election was
approved by a vote of at least two-thirds of the directors comprising the
Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
director, without objection to such nomination) shall be considered a
member of the Incumbent Board; provided, however, that no individual
initially elected or nominated as a director of the Company as a result of
an actual or threatened election contest with respect to directors or any
other actual or threatened solicitation of proxies or consents by
-2-
<PAGE>
or on behalf of any person other than the Board shall be deemed to be a
member of the Incumbent Board;
(iii) the shareholders of the Company approve a merger,
consolidation, share exchange or similar form of corporate reorganization
of the Company or any such type of transaction involving the Company or any
of its subsidiaries (whether for such transaction or the issuance of
securities in the transaction or otherwise) (a "Business Combination"),
unless immediately following such Business Combination: (A) more than 50%
of the total voting power of the publicly traded corporation resulting from
such Business Combination (including, without limitation, any corporation
which directly or indirectly has beneficial ownership of 100% of the
Company Voting Securities or all or substantially all of the assets of the
Company and its subsidiaries) eligible to elect directors of such
corporation would be represented by shares that were Company Voting
Securities immediately prior to such Business Combination (either by
remaining outstanding or being converted), and such voting power would be
in substantially the same proportion as the voting power of such Company
Voting Securities immediately prior to the Business Combination, (B) no
person (other than any publicly traded holding company resulting from such
Business Combination, any employee benefit plan sponsored or maintained by
the Company (or the corporation resulting from such Business Combination),
or any person which beneficially
-3-
<PAGE>
owned, immediately prior to such Business Combination, directly or
indirectly, 33-1/3% or more of the Company Voting Securities (a "Company
33-1/3% Stockholder")) would become the beneficial owner, directly or
indirectly, of 33-1/3% or more of the total voting power of the outstanding
voting securities eligible to elect directors of the corporation resulting
from such Business Combination and no Company 33-1/3% Stockholder would
increase its percentage of such total voting power, and (C) at least a
majority of the members of the board of directors of the corporation
resulting from such Business Combination would be members of the Incumbent
Board at the time of the Board's approval of the execution of the initial
agreement providing for such Business Combination (a "Non-Control
Transaction"); or
(iv) the shareholders of the Company approve a plan of complete
liquidation or dissolution of the Company or the sale or disposition of all
or substantially all of the Company's assets.
Notwithstanding the foregoing, a Change in Control of the Company shall not
be deemed to occur solely because any person acquires beneficial ownership of
more than 33-1/3% of the Company Voting Securities as a result of the
acquisition of Company Voting Securities by the Company which, by reducing the
number of Company Voting Securities outstanding, increases the percentage of
shares beneficially owned by such person; provided, that if a Change in Control
of the Company would occur as a result of such an acquisition by the Company (if
not for the operation of this
-4-
<PAGE>
sentence), and after the Company's acquisition such person becomes the
beneficial owner of additional Company Voting Securities that increases the
percentage of outstanding Company Voting Securities beneficially owned by such
person, then a Change in Control of the Company shall occur.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall mean a committee of at least two members of the
Board appointed by the Board to administer the Plan and to perform the functions
set forth herein and who are "non-employee directors" within the meaning of Rule
16b-3 as promulgated under Section 16 of the Exchange Act and who are also
"outside directors" within the meaning of Section 162(m) of the Code.
(f) "Common Stock" shall mean the common stock, no par value per share,
of the Company.
(g) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(h) "Fair Market Value" per share as of a particular date shall mean
the last reported sale price (on the day immediately preceding such date) of the
Common Stock on the NASDAQ National Market List.
(i) "Immediate Family Member" shall mean, except as otherwise
determined by the Committee, a Participant's children, stepchildren,
grandchildren, parents, stepparents, grandparents, spouse, siblings, inlaws and
persons related by reason of legal adoption.
(j) "Incentive Stock Option" shall mean a stock option which is
intended to meet the requirements of Section 422 of the Code.
-5-
<PAGE>
(k) "Non-Employee Director" shall mean a member of the Board who is not
an employee of the Company or any Subsidiary.
(l) "Nonqualified Stock Option" shall mean a stock option which is not
intended to be an Incentive Stock Option.
(m) "Option" shall mean either an Incentive Stock Option or a
Nonqualified Stock Option.
(n) "Participant" shall mean an employee or director of the Company or
its Subsidiaries who is selected to participate in the Plan in accordance with
Section 5.
(o) "Subsidiary" shall mean any subsidiary of the Company that is a
corporation and which at the time qualifies as a "subsidiary corporation" within
the meaning of Section 424(f) of the Code.
3. Shares Subject to the Plan. Subject to adjustment in accordance with
Section 16, the total of the number of shares of Common Stock which shall be
available for the grant of Awards under the Plan shall not exceed 500,000
shares; provided, that, for purposes of this limitation, any Option which is
canceled or expires without exercise shall again become available for Awards
under the Plan. Upon forfeiture of Awards in accordance with the provisions of
the Plan, and the terms and conditions of the Award, such shares shall no longer
be counted in any determination of the number of shares available under the Plan
and shall be available for subsequent Awards. Subject to adjustment in
accordance with Section 16, no employee shall be granted in any calendar year
Options to purchase more than 500,000 shares of Common Stock. Shares of Common
Stock available for issue or distribution under the Plan
-6-
<PAGE>
shall be authorized and unissued shares or shares reacquired by the Company in
any manner.
4. Administration.
(a) The Plan shall be administered by the Committee.
(b) The Committee shall (i) approve the selection of Participants, (ii)
determine the type of Awards to be made to Participants, (iii) determine the
number of shares of Common Stock subject to Awards, (iv) determine the terms and
conditions of any Award granted hereunder (including, but not limited to, any
restriction and forfeiture conditions on such Award) and (v) have the authority
to interpret the Plan, to establish, amend, and rescind any rules and
regulations relating to the Plan, to determine the terms and provisions of any
agreements entered into hereunder, and to make all other determinations
necessary or advisable for the administration of the Plan. The Committee may
correct any defect, supply any omission or reconcile any inconsistency in the
Plan or in any Award in the manner and to the extent it shall deem desirable to
carry it into effect.
(c) Any action of the Committee shall be final, conclusive and binding
on all persons, including the Company and its Subsidiaries and shareholders,
Participants and persons claiming rights from or through a Participant.
(d) The Committee may delegate to officers or employees of the Company
or any Subsidiary, and to
-7-
<PAGE>
service providers, the authority, subject to such terms as the Committee shall
determine, to perform administrative functions with respect to the Plan and
Award agreements.
(e) Members of the Committee and any officer or employee of the Company
or any Subsidiary acting at the direction of, or on behalf of, the Committee
shall not be personally liable for any action or determination taken or made in
good faith with respect to the Plan, and shall, to the extent permitted by law,
be fully indemnified by the Company with respect to any such action or
determination.
5. Eligibility. Individuals eligible to receive Awards under the Plan
shall be the officers and other key employees of the Company and its
Subsidiaries selected by the Committee. In addition, all Non-Employee Directors
shall be eligible to receive Options as provided in Section 9 hereof.
6. Awards. Awards under the Plan may consist of Options, stock awards or
other awards based on the value of the Common Stock. Awards shall be subject to
the terms and conditions of the Plan and shall be evidenced by an agreement
containing such additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Committee shall deem desirable.
7. Options. Options may be granted under the Plan in such form as the
Committee may from time to time approve pursuant to terms set forth in an Option
agreement. The Committee may alter or waive, at any time, any term or condition
of an Option that is not mandatory under the Plan.
(a) Types of Options. Each Option agreement shall state whether or not
the Option will be treated as an Incentive Stock Option or Nonqualified Stock
Option.
-8-
<PAGE>
(b) Option Price. The purchase price per share of the Common Stock
purchasable under an Option shall be determined by the Committee, but in the
case of Incentive Stock Options, the Option price will be not less than 100% of
the Fair Market Value of the Common Stock on the date of the grant of the Option
and in the case of Incentive Stock Options granted to an employee owning stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company and its Subsidiaries (a "10% Shareholder") the price per
share specified in the agreement relating to such Option shall not be less than
110% of the Fair Market Value per share of the Common Stock on the date of
grant.
(c) Option Period. The term of each Option shall be fixed by the
Committee, but no Option shall be exercisable after the expiration of 10 years
from the date the Option is granted, provided, however, that in the case of
Incentive Stock Options granted to 10% Shareholders, the term of such Option
shall not exceed 5 years from the date of grant.
(d) Exercisability. Each Option shall vest and become exercisable at a
rate determined by the Committee at or subsequent to grant; provided, however,
that no Option granted under this Section 7 shall become exercisable earlier
than the time that the Plan is approved by the shareholders of the Company in
accordance with Section 21; provided, further, that upon the occurrence of a
Change in Control before such shareholder approval, all Incentive Stock Options
granted hereunder shall automatically become Nonqualified Stock Options and all
Options shall vest and become immediately exercisable in accordance with Section
10.
-9-
<PAGE>
(e) Method of Exercise. Options may be exercised, in whole or in part,
by giving written notice of exercise to the Company specifying the number of
shares of Common Stock to be purchased. Such notice shall be accompanied by the
payment in full of the Option purchase price. Such payment shall be made: (a) in
cash, or (b) to the extent authorized by the Committee, by surrender of shares
of Common Stock owned by the holder of the Option, or (c) through simultaneous
sale through a broker of shares acquired on exercise, as permitted under
Regulation T of the Federal Reserve Board, or (d) through additional methods
prescribed by the Committee, or (e) by a combination of any such methods.
8. Stock Awards. Subject to such performance and employment conditions as
the Committee may determine, awards of Common Stock or awards based on the value
of the Common Stock may be granted either alone or in to Options granted under
the Plan. Any Awards under this Section 8 and Common Stock covered by any such
Award may be forfeited to the extent so provided in the Award agreement, as
determined by the Committee.
9. Non-Employee Director Stock Options.
(a) Initial Grant. Nonqualified Stock Options to purchase 30,000 shares
of Common Stock shall be granted automatically to each Non-Employee Director who
is a Non-Employee Director on the day the Board approves the adoption of the
Plan. With respect to each person who becomes a Non-Employee Director after such
date, Nonqualified Stock Options to purchase 30,000 shares of Common Stock shall
be granted automatically to each such
-10-
<PAGE>
Non-Employee Director on the day he or she first becomes a Non-Employee
Director.
(b) Subsequent Options. In addition to the Nonqualified Stock Options
granted to Non-Employee Directors under Section 9(a), Nonqualified Stock Options
to purchase 10,000 shares of Common Stock shall be granted automatically to each
Non-Employee Director, effective on the third anniversary date on which such
director was granted an Initial Option under Section 9(a) and on each
anniversary date thereafter; provided, however, he or she continues to serve as
a Non-Employee Director on such date.
(c) Option Price. The purchase price for each Option granted under this
Section 9 to a Non-Employee Director shall be the Fair Market Value of the
Common Stock on the date of grant of the Option.
(d) Exercisability. Each Initial Option granted under Section 9(a)
shall become exercisable and vest on the first anniversary of the date of grant
of such Option; provided, however, that no Option shall become exercisable
earlier than the time that the Plan is approved by the shareholders of the
Company in accordance with Section 21; provided, further, that upon the
occurrence of a Change in Control before such shareholder approval, all Options
shall vest and become immediately exercisable in accordance with Section 10.
Subsequent Options granted under Section 9(b) shall become exercisable and vest
1 year from the date of the grant thereof.
(e) Method of Exercise. Each Option granted under this Section 9 may be
exercised in the same manner as provided in Section 7(e).
-11-
<PAGE>
(f) Option Period. Each Option granted under this Section 9 shall
terminate 10 years from the date of grant unless sooner terminated by reason of
termination of service as a director of the Company and its Subsidiaries.
(g) Termination of Director Status.
(i) In the event of termination of service as a director of the
Company and its Subsidiaries for any reason other than death or permanent
disability (as determined by the Committee), an Option granted under this
Section 9 (to the extent exercisable as of the date of termination) shall
be exercisable for 90 days following such termination (but in no event
beyond the term of the Option), and shall thereafter terminate.
(ii) In the event of the death of a Non-Employee Director while a
director of the Company or any Subsidiaries, the Option (to the extent
exercisable as of the date of death), shall be exercisable by any prior
transferee or by the Non-Employee Director's designated beneficiary, or if
none, the person(s) to whom such Non-Employee Director's rights under the
Option are transferred by will or the laws of descent and distribution for
1 year following the date of death (but in no event beyond the term of the
Option), and shall thereafter terminate.
(iii) In the event of the termination of service as a director of
the Company and its Subsidiaries due to permanent disability (as
-12-
<PAGE>
determined by the Committee), the Option (to the extent exercisable as of
the date of termination), shall be exercisable for 3 years following such
termination of service (but in no event beyond the term of the Option), and
shall thereafter terminate.
(h) Except as expressly provided in this Section 9, any Option granted
to a Non-Employee Director hereunder shall be subject to the terms and
conditions of the Plan.
10. Change in Control. Upon the occurrence of a Change in Control, all
Options shall automatically become vested and exercisable in full and all
restrictions or conditions, if any, on any stock awards granted hereunder shall
automatically lapse. The Committee may, in its discretion, include such further
provisions and limitations in any agreement documenting such Options as it may
deem equitable and in the best interests of the Company.
11. Forfeiture. Notwithstanding anything in the Plan to the contrary, the
Committee may provide in any Award agreement that in the event of a serious
breach of conduct by an employee or former employee (including, without
limitation, any conduct prejudicial to or in conflict with the Company or its
Subsidiaries), or any activity of any employee or former employee in competition
with any of the businesses of the Company or any Subsidiary, (a) cancel any
outstanding Award granted to such employee or former employee, in whole or in
part, whether or not vested, and/or (b) if such conduct or activity occurs
within 1 year following the exercise or payment of an Award, require such
employee or former employee to repay to the Company any gain
-13-
<PAGE>
realized or payment received upon the exercise or payment of such Award (with
such gain or payment valued as of the date of exercise or payment). Such
cancellation or repayment obligation shall be effective as of the date specified
by the Committee. Any repayment obligation may be satisfied in Common Stock or
cash or a combination thereof (based upon the Fair Market Value of Common Stock
on the day prior to the date of payment), and the Committee may provide for an
offset to any future payments owed by the Company or any Subsidiary to the
employee or former employee if necessary to satisfy the repayment obligation.
The determination of whether an employee or former employee has engaged in a
serious breach of conduct or any activity in competition with any of the
businesses of the Company or any Subsidiary shall be determined by the Committee
in good faith and in its sole discretion. This Section 11 shall have no
application following a Change in Control.
12. Withholding. The Company shall have the right to deduct from any
payment to be made pursuant to the Plan the amount of any taxes required by law
to be withheld therefrom, or to require a Participant to pay to the Company in
cash such amount required to be withheld prior to the issuance or delivery of
any shares of Common Stock or the payment of cash under the Plan. Such taxes may
be paid by (a) delivering previously owned shares of Common Stock or (b) having
the Company retain shares of Common Stock which would otherwise be delivered
upon exercise or payment of Awards or (c) any combination of a cash payment or
the methods set forth in (a) and (b) above. For purposes of (a) and (b) above,
shares of Common Stock shall be valued at Fair Market Value determined as of the
day immediately prior to exercise or payment. If and to the extent authorized by
-14-
<PAGE>
the Committee, the Company may, upon election by a Participant, withhold from
any distribution of Common Stock hereunder shares of Common Stock with a Fair
Market Value in excess of the Participant's required withholding obligation.
13. Nontransferability, Beneficiaries. Unless otherwise determined by the
Committee with respect to the transferability of Nonqualified Stock Options by a
Participant to his Immediate Family Members (or to trusts or partnerships or
limited liability companies established for such family members), no Award shall
be assignable or transferable by the Participant, otherwise than by will or the
laws of descent and distribution or pursuant to a beneficiary designation, and
Options shall be exercisable, during the Participant's lifetime, only by the
Participant (or by the Participant's legal representatives in the event of the
Participant's incapacity). Each Participant may designate a beneficiary to
exercise any Option held by the Participant at the time of the Participant's
death or to be assigned any other Award outstanding at the time of the
Participant's death. If no beneficiary has been named by a deceased Participant,
any Award held by the Participant at the time of death shall be transferred as
provided in his will or by the laws of descent and distribution. Except in the
case of the holder's incapacity, an Option may only be exercised by the holder
thereof.
14. No Right to Employment. Nothing contained in the Plan or in any Award
under the Plan shall confer upon any employee any right with respect to the
continuation of employment with the Company or any of its Subsidiaries, or
interfere in any way with the right of the Company to terminate his or her
employment at any time. Nothing
-15-
<PAGE>
contained in the Plan shall confer upon any employee or other person any claim
or right to any Award under the Plan.
15. Governmental Compliance. Each Award under the Plan shall be subject to
the requirement that if at any time the Committee shall determine that the
listing, registration or qualification of any shares issuable or deliverable
thereunder upon any securities exchange or under any Federal or state law, or
the consent or approval of any governmental regulatory body, is necessary or
desirable as a condition thereof, or in connection therewith, no such grant or
award may be exercised or shares issued or delivered unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.
16. Adjustments. In the event of any change in the outstanding shares of
Common Stock by reason of any stock dividend or split, recapitalization, merger,
consolidation, spinoff, combination or exchange of shares or other corporate
change, or any distribution to holders of Common Stock other than regular cash
dividends, the number or kind of shares available for Options and Awards under
the Plan may be adjusted by the Committee as it shall in its sole discretion
deem equitable and the number and kind of shares subject to any outstanding
Awards granted under the Plan and the purchase price thereof may be adjusted by
the Committee as it shall in its sole discretion deem equitable to preserve the
value of such Awards.
17. Award Agreement. Each Award under the Plan shall be evidenced by an
agreement setting forth the terms and conditions, as determined by the
Committee, which shall
-16-
<PAGE>
apply to such Award, in addition to the terms and conditions specified in the
Plan.
18. Amendment. The Board may amend, suspend or terminate the Plan or any
portion thereof at any time, provided that (a) no amendment shall be made
without shareholder approval if such approval is necessary to comply with any
applicable law, regulation or stock exchange rule and (b) except as provided in
Section 16, no amendment shall be made that would adversely affect the rights of
a Participant under an Award theretofore granted, without such Participant's
written consent.
19. General Provisions.
(a) The Committee may require each Partici pant purchasing or acquiring
shares pursuant to an Award under the Plan to represent to and agree with the
Company in writing that such Participant is acquiring the shares for investment
and without a view to distribution thereof.
(b) All certificates for shares of Common Stock delivered under the
Plan pursuant to any Award shall be subject to such stock-transfer orders and
other restrictions as the Committee may deem advisable under the rules,
regulations, and other requirements of the Securities and Exchange Commission,
any stock exchange upon which the Common Stock is then listed, and any
applicable Federal or state securities law, and the Committee may cause a legend
or legends to be put on any such certificates to make appropriate reference to
such restrictions. If the Committee determines that the issuance of shares of
Common Stock hereunder is not in compliance with, or subject to an exemption
from, any applicable Federal or state securities
-17-
<PAGE>
laws, such shares shall not be issued until such time as the Committee
determines that the issuance is permissible.
(c) It is the intent of the Company that the Plan satisfy, and be
interpreted in a manner that satisfies, the applicable requirements of Rule
16b-3 as promulgated under Section 16 of the Exchange Act so that Participants
will be entitled to the benefit of Rule 16b-3, or any other rule promulgated
under Section 16 of the Exchange Act, and will not be subject to short-swing
liability under Section 16. Accordingly, if the operation of any provision of
the Plan would conflict with the intent expressed in this Section 19(c), such
provision to the extent possible shall be interpreted and/or deemed amended so
as to avoid such conflict.
(d) Except as otherwise provided by the Committee in the applicable
grant or Award agreement, a Participant shall have no rights as a shareholder
with respect to any shares of Common Stock subject to Options until a
certificate or certificates evidencing shares of Common Stock shall have been
issued to the Participant and, subject to Section 16, no adjustment shall be
made for dividends or distributions or other rights in respect of any share for
which the record date is prior to the date on which Participant shall become the
holder of record thereof.
(e) The law of the State of New Jersey shall apply to all Awards and
interpretations under the Plan regardless of the effect of such state's conflict
of laws principles.
(f) Where the context requires, words in any gender shall include any
other gender.
-18-
<PAGE>
20. Term of Plan. Subject to earlier termination pursuant to Section 18,
the Plan shall have a term of 10 years from its Effective Date.
21. Effective Date; Approval of Shareholders. The Plan is effective as of
July 24, 1997. The Plan is conditioned upon the approval of the shareholders of
the Company, and failure to receive their approval shall render the Plan and all
outstanding Awards issued thereunder void and of no effect; provided, however,
that this limitation shall have no effect upon the occurrence of a Change in
Control before such shareholder approval, and all Awards shall be exercisable in
accordance with their terms.
-19-
EXHIBIT 5.1
<TABLE>
<S> <C>
SULLIVAN & CROMWELL
NEW YORK TELEPHONE: (212) 558-4000
TELEX: 62694 (INTERNATIONAL) 127816 (DOMESTIC) 125 Broad Street, New York 10004-2498
CABLE ADDRESS: LADYCOURT, NEW YORK __________
FACSIMILE: (212) 558-3588 (125 Broad Street) 375 PARK AVENUE, NEW YORK 10152
(212) 558-1139 (250 Park Avenue) 1701 PENNSYLVANIA AVE, N.W. WASHINGTON, D.C. 20006-5805
444 SOUTH FLOWER STREET, LOS ANGELES 90071-2901
8, PLACE VENDOME, 75001 PARIS
ST. OLAVE'S HOUSE, 9a IRONMONGER LANE, LONDON EC2V 8EY
101 COLLINS STREET, MELBOURNE 3000
2-1, MARUNOUCHI I-CHOME, CHIYODA-KU, TOKYO 100
NINE QUEEN'S ROAD, CENTRAL, HONG KONG
</TABLE>
September 16, 1997
Dendrite International, Inc.,
1200 Mount Kemble Avenue,
Morristown, NJ 07960-6797.
Dear Sirs:
In connection with the registration under the Securities Act of 1933
(the "Act") of 500,000 shares of Common Stock ("Common Stock"), without par
value, of Dendrite International, Inc., a New Jersey corporation (the
"Company"), some of which may be newly issued Common Stock by the Company after
the date hereof pursuant to the terms of the 1997 Stock Incentive Plan (the
"Securities"), we, as your special counsel, have examined such corporate
records, certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion. Upon the
basis of such examination, we advise you that, in our opinion, when the
registration statement relating to the Securities (the "Registration Statement")
has become effective under the Act, the terms of the issue and sale of the
Securities have been duly established in conformity with the Company's
<PAGE>
Dendrite International, Inc. Page 2
certificate of incorporation, and the Securities have been duly issued and sold
as contemplated by the Registration Statement and the terms of the 1997 Stock
Incentive Plan under which such Securities are to be issued, the Securities will
be validly issued, fully paid and nonassessable.
The foregoing opinion is limited to the Federal laws of the United
States and the Business Corporation Act of the State of New Jersey, and we are
expressing no opinion as to the effect of the laws of any other jurisdiction.
We have relied as to certain matters on information obtained from
public officials, officers of the Company and other sources believed by us to be
responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Act.
Very truly yours,
/s/ SULLIVAN & CROMWELL
EXHIBIT 23.2
As independent public accountants, we hereby consent to the incorporation by
reference in this S-8 Registration Statement of our report dated February 7,
1997 included in Dendrite International, Inc.'s Form 10-K for the year ended
December 31, 1996 and to all references to our Firm included in this
Registration Statement.
ARTHUR ANDERSEN LLP
